“That correlates more with any other success factor that I’ve seen in the world’s greatest entrepreneurs. If you look at [Amazon founder Jeff] Bezos, or [Netscape founder Marc] Andreessen, [Yahoo co-founder] David Filo, the founders of Google, they all seem to be white, male, nerds who’ve dropped out of Harvard or Stanford and they absolutely have no social life.”
If you dissect it, is an ignorant, short-sighted statement, especially from such a prominent star in the tech firmament.
Let’s take the words separately in their reverse order to see why.
In the tech world, nerds are typically consumed by the bleeding edge of technology, socially challenged and will doggedly pursue their ideas come Hell or high water. Of course there are more male nerds. Starting in elementary school, girls are discouraged from STEM, whether it’s Barbie saying, “Math is tough!” to the unconscious bias that permeates our classrooms and companies.
As to white, nerds actually come in many shapes, sizes, genders, colors, faiths and from across the socio-economic spectrum. but anyone who follows the current state of tech culture shouldn’t be surprised.
The real reason that that white, male nerds are successful is that they get funded.
They get funded because they are connected — by family, friends, school friends, ex colleagues, etc. — which means they get into the right accelerators (just as Harvard and Stanford are the right schools) or are personally introduced to investors.
The end result is that if you take a superficial look at the stats Doerr’s comment seems to be true—but it is not.
For all the talk about the lack of diversity some folks still don’t get it.
It’s a recognized fact that sometimes very smart people do or say very stupid things as reflected in Marc Andreessen’s recent comment explaining that companies actually are diverse.
“When you actually go in these companies, what you find is it’s American people, but it’s also Russians, and Eastern Europeans, and French, and German, and British. And then there are the Chinese, Japanese, Koreans, Thais, Indonesians, and Vietnamese.”
A recent Reuters report found that the majority of Silicon Valley startup founders that receive Series A funding come from the same pedigreed cohort: either they previously worked at a large, well-known tech firm, a well-connected smaller tech company, they previously created a successful startup, or they come from one of three universities—Stanford, Harvard, or MIT.
Andreessen also says that the lack of women and people of color in Valley companies is a function of education inequality and not having the right connections; another thought that flies in the face of facts.
Except for the fact that a recent analysis conducted by USA Today found that top universities are graduating black and Hispanic computer science and computer engineering students at twice the rate that technology companies are hiring them. Last year, 4.5% of computer science and engineering graduates from top universities were black and 6.5% were Hispanic. But on average, just 2% of employees at Silicon Valley tech companies (specifically, the seven companies that have released diversity stats) are black and 3% are Hispanic.
The walls around the Valley investor community are far higher now than they were when in 1993 when he happened to meet Jim Clark, who suggested forming a company based on a program Andreessen wrote in college called Mosaic.
The Valley needs to wake up, bite the bullet and follow the lead of Google, instead of pulling Andreessen’s rationalizing over their collective heads.
Tuesday is April 26th, but more importantly it’s my birthday. There are some pretty cool people born on the 26th and I chose a few to share.
Marcus Aurelius was a big believer in MAP, “Our life is what our thoughts make it.”
William Shakespeare provides a great description of my two best friends, I hope you have people like this in your life, “A friend is one that knows you as you are, understands where you have been, accepts what you have become, and still, gently allows you to grow.”
Bernard Malamud had great insight into how one learns, “Stay with it. . . ultimately you teach yourself something very important about yourself.”
Carol Burnett’s thoughts about life really refer to MAP, “Only I can change my life. No one can do it for me.”
I was surprised to find that John Audubon and I have more in common than our birthday—we see our lives similarly, but I’m tempted to substitute ‘weird’ for ‘curious’, “I cannot help but think a curious event is this life of mine.”
Finally, since I was generous enough to share my birthday with Marc Andreessen, I wish he would reciprocate by sharing some contacts with me. (Sorry, couldn’t’ find a good quote.)
For more than a decade my angel investor and many of our colleagues have been bemoaning what happened to the venture world. Call it the takeover of the walking investment banker.
It started when the name partners wanted to kick back a bit. That made sense, but unfortunately they went to Wall Street for their new people and hired a lot of the hot young turks who were great at manipulating money, but had never really produced anything.
I remember a client telling me how the Board member from his VC investor had a tantrum yelling for the company’s ROI numbers—when the company was six months, working on a revolutionary hardware/software system and the product was still in development. Sheesh.
“The biggest names in the industry are concerned about low returns and are blaming several factors: funds that have grown too large, the M.B.A.’s that have invaded the industry and older partners who have lost touch with what is new in technology.”
For those who don’t understand, typically a partner sits on the board of each startup that the firm funds and this limits the number of companies in which they can invest. In 1990 VCs invested $2.7 billion, at the height of the dot bomb it was $104 billion; it’s dropped back to around $30 billion now.
Because the money must be put to work, too much money is often forced on firms that didn’t need it.
“That often means forcing $3 million into a company that needs $300,000,” according to Ben Horowitz.
Now a number of VC firms, some old players and some new ones have decided to change the game.
“Marc Andreessen, who co-founded Netscape, is announcing on Monday that he and Ben Horowitz, a longtime business associate, have raised $300 million that they intend to invest in technology companies. The venture capital firm, Andreessen Horowitz, will risk small sums, as little as $50,000, on new ideas.”
This is good strategy, far better than pushing millions on a company that needs far less for no other reason than the money needs to be invested and the number of partners is limited.
So what does all this mean to you?
Well, it won’t happen overnight, but it could mean dozens or even hundreds of new, solid startups with doable business plans and backed by patient money.
The kind of companies that grow and flourish because their investors don’t have to have a multi-billion return next week to look like heroes to their investors.
And that’s what made our economy and country strong.
Image credit: Mark Coggins on flickr and agoldfisher on YouTube
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It started when the name partners wanted to kick back a bit. That made sense, but unfortunately they went to Wall Street for their new people and hired a lot of the hot young turks who were great at manipulating money, but had never really produced anything.
