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Archive for September, 2019

Golden Oldies: If The Shoe Fits: Founders and Fools

Monday, September 30th, 2019

https://www.flickr.com/photos/hikingartist/5726760809/

Poking through 13+ years of posts I find information that’s as useful now as when it was written.

Golden Oldies is a collection of the most relevant and timeless posts during that time.

Last week’s look at the “new” Microsoft reminded me of a previous post that’s especially apropos in light of unicorn valuations crashing headlong into the reality of investor focus on profitability.

Read other Golden Oldies here.

A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here.

Neither market cap nor valuation are cause for celebration.

Both are as ephemeral as morning fog.

Ask Microsoft CEO Satya Nadella his reaction when Microsoft became the most valuable company in the world for a few months last fall.

“I’m not one of those guys who says, ‘let’s celebrate some market cap measure.’ That’s just not stable.”

What does interest him?

The Microsoft-generated ecosystem.

“Our business model is about creating more surplus outside us. We will only be long-term success when the people are making more money around us,” he said.

This dovetails with what Bill Gates also believes, i.e., a company’s success is defined when the total value of the ecosystem around it is more valuable than the company that created it.

That ecosystem seems non-existent to the majority of founders of gig economy businesses, dating apps, social media, etc.

Or perhaps it’s just those with venture funding who are focused on growth at all costs.

That said, this post is dedicated to the founders who focus on building sustainable businesses/ecosystems.

As opposed to the fools who chase investment in lieu of revenue, celebrate valuation based on their last round of funding, and don’t care about ecosystem beyond its PR value.

Image credit: HikingArtist

Big Tech Bosses Should Channel Gates

Wednesday, September 25th, 2019

https://www.flickr.com/photos/liquidat/155525087/

Looking at founders, such as Larry Page, Jeff Bezos and Mark Zukerberg, you get the feeling they believe they are all powerful — more so than even governments.

It’s not a new attitude; Bill Gates learned they aren’t the hard way.

The Microsoft co-founder Bill Gates, according to Mr. Smith, “learned that life actually does require compromise and governments actually are stronger than companies,” if only after a bruising confrontation.

Mr. Gates, who wrote the foreword in Mr. Smith’s book, recalled that for years he was proud of how little time he spent talking to people in government. “As I learned the hard way in the antitrust suit,” he wrote, “that was not a wise position to take.”

Lesson learned well enough that you don’t see Microsoft on the common list of big tech, Google, Facebook, Amazon, and Apple.

That lesson hasn’t hurt Microsoft, which is valued at more than a trillion dollars by investors based on profitability, not funding.

Satya Nadella, who became CEO in 2014, is credited most often for the change in Microsoft fortunes, i.e., its culture. attitude and product mix.

You don’t hear as much about Microsoft president Brad Smith, but he’s the guy who made friends with government and helps with policy.

“When your technology changes the world,” he writes, “you bear a responsibility to help address the world that you have helped create.”

Responsibility.

The thing that so many founders don’t see as being within their purview.

Unlike Microsoft, their future will be decided more in Europe than in the US.

But the revised interpretation of an old US law could change things drastically.

And that change is being driven in by a surprising source.

Join me next Tuesday to learn more about it.

Image credit: luquidat

Candidate Due Diligence

Tuesday, September 24th, 2019

http://blog.chaukhat.com/2011/04/13-funny-t-shirt-quotes.html

Last week we saw how the best places to work rankings change — Google was number one for six straight years, now it’s number eight, while Facebook dropped to seventh place.

People change too. Google CEO Sundar Pichai, who was named the world’s most reputable CEO in 2018, didn’t even make the top 10 this year.

Friends and family often aren’t aware of the most current news about a company and even when they are they may minimize it, especially if the company is hot or an icon.

This isn’t just about Google; Facebook, Amazon or dozens of others that are just as problematical.

Hot startups encourage you to jump in without due diligence. WeWork may seem like an extreme example, but it’s not as uncommon as you might think — remember Theranos, Uber and Zenefits.

It’s about how fast things change, both the big stuff and the little stuff, all the stuff that underlies culture and trust, which can and should affect your decisions.

Because it’s your career, your life and, corny as it may sound, your soul.

Image credit: chaukhat.com

Golden Oldies: Where To Work

Monday, September 23rd, 2019

https://www.flickr.com/photos/jeepersmedia/9698637692/

Poking through 11+ years of posts I find information that’s as useful now as when it was written.

Golden Oldies is a collection of the most relevant and timeless posts during that time.

Knowing, understanding and accepting yourself is critical to major decisions, such as choosing a spouse/life partner/job. Ignoring or distorting any of the first three practically guarantees blowing the last three. As does ignoring or distorting the info gathered from your due diligence on the last three.

Read other Golden Oldies here.

There’s a very stupid myth that only the very talented are hired by startups and that the very talented only want to work for startups.

The corollary being that those who work for public companies, let alone large ones, probably aren’t all that talented and certainly not innovative/creative.

What a crock.

Another part of that myth is that working for a startup is the road to riches.

An even bigger crock.

The myth also says that the best place to work is a unicorn, such as or AirBnB, GitHub or Palantir,

And that is the biggest crock of all.

If you are looking for new opportunities and are dazzled by the idea of working at a unicorn I strongly suggest you read Scott Belsky’s post on Medium.

A company’s fate is ultimately determined by its people, so talent is everything. But this old adage bumps up against another one: cash is king (or runway is king, for a fast-growing private company). Without runway, talent takes off. So, it is no surprise that bold moves to extend runway (think late-stage financings at technically large valuations with some tricky liquidation preferences underneath) are done even if they could hurt the company (and its people) in the long run. This is especially true when these financings are ego-driven rather than strategic. The problem is, the employees at these companies don’t understand the implications.

But whether startup or Unicorn, this anonymous post on GitHub is a must read.

This is a short write-up on things that I wish I’d known and considered before joining a private company (aka startup, aka unicorn in some cases). I’m not trying to make the case that you should never join a private company, but the power imbalance between founder and employee is extreme, and that potential candidates would do well to consider alternatives.

The right place for you to work is the one that satisfies what you want — whether that’s the opportunity to work on bleeding edge technology, build a network, upgrade your resume or even plain, old curiosity.

The wrong place is the one you join with an eye to getting rich quick or for bragging rights.

Or because somebody says you “should.”

Image credit: Mike Mozart

Google and Retention

Wednesday, September 18th, 2019

https://www.flickr.com/photos/ben_nuttall/25451921904/ 

Next Monday’s Oldie is about what to look for when choosing a place to work, with a special caution for unicorns.

Today I thought we’d take a quick look at a “great place to work” myth.

Google topped the best places to work lists for years, but no more.

According to the 2019 Glassdoor survey Google is in 8th place based on 9186 reviews.

Last year 20,000 people walked out in protest over the handling of sexual harassment accusations and Google promised to do better.

But almost a year after the historic walkout, a dozen current and former Google employees told Recode that many employees are still justifiably afraid to report workplace issues because they fear retaliation. They say the company continues to conceal rather than confront issues ranging from sexual harassment to security concerns, especially when the problems involve high-ranking managers or high-stakes projects. …dozens more employees say that when they filed complaints with Google’s human resources department, they were retaliated against by being demoted, pushed out, or placed on less desirable projects.

… Google’s top-down culture that suppresses meaningful employee pushback — even in areas the company says it’s trying to improve on, like diversity.

To really find out about a company you need to do the same depth of due diligence on it that the company does on you.

That requires more than reading employee reviews; it means searching traditional media as well as proven new media.

And checking out who left and why.

Most of all it means making the time to just do it.

Image credit: Ben Nuttall

Guest Post: “Talent” is Bunk

Tuesday, September 17th, 2019

I’m frequently accused about being badly out-of-date with current terms, let alone trendy ones, but I find myself using them even when they make me uncomfortable. That’s the case with “talent,” a term I’ve used, although it makes me squirm. This post from Wally Bock does a great job of explaining why. (I never really thought it through.) Thanks, Wally!

I’m sick of “talent.” I’m sick of wars for talent, and talent pipelines, and talent acquisition. I’m sick of talent anywhere it’s used as a substitute for people. People are not talent. People have talent. People are more than talent.

There’s no such thing as disembodied talent. Every bit of talent comes wrapped up in flesh and blood people.

People Are More Than Talent

People aren’t just talent. They bring you their hopes and fears. They bring their experience, expertise, and passions. Sure, their talent is important, but so are other things.

Their work ethic is important. The other people on your team want to work with someone who pulls their own weight. If you’ve got a slacker, even a talented one, you’ve got a problem.

Social skills matter. Nobody wants to work with or for a jerk. If you’ve got a talented person who can’t get along with other people, you’ve got a problem.

The situation matters. Context is critical. Talent is specific. If you’ve got a talented person in the wrong job, you have a problem.

Let’s quit talking about talent as if it’s some disembodied thing that we can bottle or store or (gag) develop. Instead, let’s think of talent as one of the many parts of those complex and wonderful people we work with.

Image credit: Three Star Leadership

Golden Oldies: If The Shoe Fits: Hypocrisy And Greed In Startup Land

Monday, September 16th, 2019

https://www.flickr.com/photos/hikingartist/5726760809/

Poking through 11+ years of posts I find information that’s as useful now as when it was written.

Golden Oldies is a collection of the most relevant and timeless posts during that time.

How time and tech fly. I wrote this in 2017 and there’s been a lot of change since then. In short, while hypocrisy has skyrocketed, with the advent of Uber, Lyft, We, and others profitability has fallen way behind. Greed, however, is alive and kicking butt — think We’s Adam Neumann.

Read other Golden Oldies here.

A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here.

Tuesday I cited a post by Scott Belsky on Medium talking about how employees are often conned (my word) by founders, especially unicorns, when it comes to the wealth that is supposed to flow from their ISO.

As pithy as the post was, some of the comments were even pithier. I especially like this one from  colorfulfool (21st comment)

If profitability were proportional to hypocrisy, there would be no failed startups in the Valley.

Not just true, but succinctly and elegantly stated.

Founders love to talk about the importance of transparency, trust and authenticity.

However, their stock plans and pitfalls thereof exhibit such a high degree of opaqueness and caveat emptor that they kick a hole the size of Texas in the fabric of the founders’ authenticity.

Another prevalent piece of hypocrisy is “change the world.”

Do you really believe that another dating app or being able to evaluate a new restaurant or another way to buy your groceries will change the world?

While they may impact one’s personal world, they certainly don’t have the impact of something like Mine Kafon.

What is proportional to the Valley’s hypocrisy is its sheer greed.

Actually, when I stop to think about it, the greed probably exceeds even the hypocrisy.

Image credit: HikingArtist

Amazon’s Consumer Kool-Aid

Wednesday, September 11th, 2019

https://www.flickr.com/photos/jeepersmedia/12892968354/

Amazon is right up there when considering big tech Kool-Aid.

All by itself it has done more to addict consumers to near instant gratification, with no vision past themselves, than any other company.

In doing so it has actually killed people and ruined lives.

And it has done it in a way that shielded it from both notoriety and financial responsibility.

Rather than a synopsis and comments from me, take a few minutes to read the original ProPublica’s, in conjunction with The New York Times, investigative article.

This isn’t the first article detailing deplorable working conditions that have resulted in numerous walkouts by Amazon and contracted workers,

But the only walkout that would actually have an impact is a customer walkout.

Obviously, it’s unlikely that anyone will actually quit using Amazon.

But if just 1% of users stopped for just one week, Amazon would definitely sit up and take notice.

And if a higher percentage stopped even better.

Whether it’s Amazon, Uber or any of dozens of other companies whose business model is built on unfair/dangerous worker practices they need to step up and start taking responsibility for the actions of people who deliver their “experiences,” instead of claiming they are “independent contractors” while still controlling their daily actions at work.

Image credit: Mike Mozart

Altered States: Drinking Big Tech Kool-Aid

Tuesday, September 10th, 2019

https://www.flickr.com/photos/jeepersmedia/12892968354/

Yesterday I commented that no matter how stellar someone’s past performance it wasn’t a guarantee of future performance.

There are very few guarantees in life, but I do know of one thing you can count on.

And that is that the bosses of big tech lie.

They do it with flair, sincerity, a straight face and in writing.

Their devices listen to and share your words with outsiders — outside the company and the country.

Although no immediate action was taken against Apple or Amazon— which both have been found to also listen in on their users — the commissioner’s report “invited” the companies “swiftly review” their policies and procedures.

Apple says, “all reviewers are under the obligation to adhere to Apple’s strict confidentiality requirements,” but we all know that people blab.

The Terms of Service (TOS) go beyond straight lies by being opaque and obfuscated. Their rules and meaning are a constantly moving target that even the NYT can’t figure out

The Times reported 46 of the accounts to Instagram, the site responded within 24 hours that none violated its rules, without explaining why.

The accounts were scams using scraped images of innocent US military personnel to get money from innocent US citizens.

While fraud has proliferated on Facebook for years, those running the military romance scams are taking on not only one of the world’s most influential companies, but also the most powerful military — and succeeding.

Apparently fraud doesn’t violate the TOS.

But why should it, since violence, hate speech and bullying don’t.

It’s not as if your data is unidentifiable (there’s no such thing as “anonymized data”).

And “we care about your privacy” is the biggest lie of all.

Image credit: Mike Mozart

Golden Oldies: Mine’s Bigger Than Yours

Monday, September 9th, 2019

https://www.flickr.com/photos/hphillips/2960666316/

Poking through 11+ years of posts I find information that’s as useful now as when it was written.

Golden Oldies is a collection of the most relevant and timeless posts during that time.

It’s said that money is the root of all evil, but there are plenty of evil people with no money and lots of wealthy people who do enormous good. I think it’s more accurate to say that greed is the root, since people will do anything to satisfy it. And often, what they do is perfectly legal — but legal doesn’t mean either ethical or moral.

Read other Golden Oldies here.

I’m no happier about the AIG and other bonuses paid to screwed up Wall Street banks, but I’m not sure why any of us are surprised.

“In the largest 25 corporate bankruptcies between 1999 and 2002, while hundreds of billions of dollars of investor wealth and over 100,000 jobs disappeared, the Financial Times found the “barons of bankruptcy” made off with $3.3 billion.”

Giant compensation packages, guaranteed bonuses and platinum parachutes are excused by Boards and executives as necessary to attract the “best and brightest,” but here’s what’s really going on.

The ‘names’ demand outsize compensation/stock options/guaranteed bonus/etc. in order to validate their ‘brand’.

Those responsible for hiring not only meet the demands, but even exceed them in an effort to attain or sustain the company’s reputation as a better home for ‘stars’ — the more stars you have the greater the bragging rights — mine’s bigger than yours in high school locker room talk.

Now let’s consider the folly of this attitude.

Those hiring often seek a name brand in the mistaken belief that the brand comes with a warranty that guarantees good results.

But no matter who you hire you’re actually paying for their past performance, which is always influenced by

    • circumstances—boss and company positioning in its market and industry
    • environment—culture and colleagues;

and let us not forget that minor factor

    • the economy.

The hiring mindset is that everything the brand accomplished was done in a total vacuum and dependent only on the brand’s own actions, therefore changing every single surrounding factor will have no impact on performance.

Put like that it sounds pretty stupid, doesn’t it.

This is one of the prime reasons that so many CEOs bring their ‘own team’ over when they move, as do managers all the way down the food chain—they know they didn’t do it alone.

CEOs aren’t like movie and rock stars whose very names draw consumers into spending money—nobody ever bought a product from GE because Jack Welch was CEO, nor do they carry Jobs iPods—so why pay them that way?

Moreover, assuming that performance occurring during an expansion is a valid yardstick for performance in general, let alone a downturn, is sheer idiocy.

You have only to remember the difficulties faced by people whose management skills were honed between 1991 and 2000, the longest expansion in our history. When the recession hit in March of 2001 they had no experience whatsoever of how to drive revenue or manage in a down economy.

That recession and the previous one in 1990 lasted only 8 months each. The longest recession we’ve had was 2 years, January-July 1980 and July 1981-November 1982, and that one had a 12 month break in it. This means there are a very small number of managers with any actual experience managing in anything even close to what’s happening now.

The current recession officially started in December 2007, so it’s already 15 months old and the end isn’t in sight.

What experience makes these folks the ‘best and brightest’ for today’s world?

Just why the hell are companies still guaranteeing oversized compensation and exorbitant exit packages when now is definitely the time to pay for future performance—no guarantees.

Image credit: flickr

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