1 hour ago
The network is rapidly displacing the hierarchy and with it the virtual displaces the physical. We’ve got a ways to go, but think about how our relationship works (very little physical, a lot virtual, very close and intimate, even though we are rarely together physically). I experience this even more profoundly as an introvert as I’d love to spend even more of my time physically alone but emotionally and intellectually connected.
It was a big week for social networks.
But the term itself seems to have lost some of it’s impact. Over time we’ve come to associate social networks with Mark Zuckerberg, Aaron Sorkin and blue pixelated Fonzy thumbs.
This afternoon, at our Foo Health event in Boston, Nicholas Christakis broke me out of that metaphorical mental rut with a session on the role and impact our social networks play in our personal health, happiness and achievements.
As he spoke, and as the group of participants questioned and expanded upon his ideas, I was struck with just how fortunate I am to be a part of the social networks that have come to shape my personal and professional lives.
It’s been a long week of travel for me, thus the slow posting here. As the events of the week wash over me on this return flight, I can’t help but trace the network connections of my past to seat 8C. From my beginnings in the suburbs of Portland, Oregon to my life in the bay area. From my first job as a file clerk to the work I get to do now. At each step, the networks I navigated shaped the ideas I pursued and opportunities afforded me.
In this TED talk from 2010, Nicholas breaks down the roll of social networks we participate within and the impact they have on us. Near the end, he compares the base material of these networks to carbon. Depending on the connections made between the same carbon molecules graphite OR diamonds could emerge.
The same is true of our personal social networks. We all have the same base material, it’s how we connect that material that makes all the difference.
Great food for thought and required weekend viewing.
What are the consequences to trying? I could f up really bad and lose my savings and I’d be broke. Big deal. I’m not a flashy person so I can easily go back to zero and work my way back up, it doesn’t scare me.
We can’t keep designing as we used to if we want people to engage with our content. We can’t keep charging for ads that our layouts train readers to ignore. We can’t focus so much on technology that we forget the web is often, and quite gloriously, a transaction between reader and writer.
Zeldman
FDIC for Startups
When the banks started melting down in the midst of the 2008 financial crisises, suddenly a little sticker that had been placed at their front doors and teller windows took on new meaning. The sticker contained four letters: FDIC
The FDIC was established in 1934 to protect the customers of its member banks against loss should the bank fail or become insolvent. Next to the four letters on the sticker mentioned above reads the following promise:
Deposits are backed by the full faith and credit of the United States Government.
Since establishing the FDIC no depositor has lost funds as a result of a bank failure.
I was reminded of the FDIC as I read of the torrid pace of acquisitions that are happening in startupland these days. As the WSJ reports Zynga, Groupon, Facebook and Google together gobbled up 34 companies in the first quarter of 2012. On the surface, that’s great news! Great for founders and, in some cases, great for investors. But, not really great news for the users of those acquired services.
Most of these acquisitions are small and, in many cases, the acquiring company shutters the underlying service in order to focus the newly purchased team’s attention on other problems they need them to solve. As a result, users and their data are often caught holding the short end of the stick. Activity and data that resided in these services is often lost, discarded or awkwardly offered for export.
Given the current state of startup funding, I foresee this being the state of our world for many years to come.
Which brings me back to the FDIC.
Seems there could/should be a neutral third party service which gives users and their data protection in the event that a startup fails or is purchased for talent. Startups could opt into, and promote their participation in a program like this offering peace of mind for potential users in the same way banks FDIC membership quells the fears of potential depositors.
Perhaps this has been discussed, tried and discarded but as more and more services launch, languish and are lapped up for talent, it seems that some kind of FDIC-like service to reassure and protect in the event of failures or acquihires would be valuable to the health of the startup ecosystem.
It’s one thing to read posts from founders and investors dispensing advice on the particulars of building a team and setting company culture. It’s another to have them look you in the eyes and share their experiences in their own words.
This video provides the latter in a direct and concise way that you can feel. Not required, but definitely worth your time to look into their eyes then into a mirror to ask yourself what kind of culture you want to create for the business you’re trying to build.
The Hamster Wheel
When VCs get together conversation often tends towards what we’re working on, what companies we’re excited about and swapping lessons learned from building our own companies that help build companies. As the headlines suggest, the pace of activity in our little corner of the world has been accelerating at a pace that many are struggling to keep up with. The metaphor one friend recently used with me was the feeling of being on a hamster wheel of running from pitch meeting to pitch meeting never getting a chance to step off, reflect and and thoughtfully act on data and conviction.
Which is why I snickered a bit when I saw this Twitter exchange between Sarah Tavel (recently departed VC) and Josh Elman (recently minted VC):
Sarah: I now understand the the difference between a maker schedule (meeting=disruption), and a manager/VC schedule (meeting=job).
Josh: this has been the hardest part of my transition to VC
Sarah: I can only imagine. in VC if your entire day isn’t filled with meetings, you wonder what you’re doing wrong!
Josh: exactly! any break is just used to try and keep the schedule full.
Josh is on the hamster wheel. Sarah has stepped off.
It’s conversations like theirs and like the one shared with my friend that are happening more and more frequently. I find myself having them both with others, within our firm and inside my own head. Less time to think means less thoughtful investment decisions. Less thoughtful advice. Less thoughtful application of our networks to the needs of our portfolio companies.
If you’re feeling trapped on the hamster wheel, you’re not alone. But there are ways to step off to catch your breath. In the past, carving out time each morning to think and write here has been a helpful respite (tho, admittedly, the hamster wheel I’m on now is making consistency here spotty of late). Carving out 30 min each night to find a quiet place process the days events and think through the following days priorities has been helpful as well.
But for early stage investors, especially right now, I would also suggest we stop worrying about what our peers are doing. Quell our inner anxiety and flaming FOMO. Recognize that today’s hot deal will be followed by tomorrow’s. You’ll catch some, you’ll miss others. Spinning on the hamster wheel of never ending pitch meetings and coffee catchups will leave us all tired, ineffective, jittery little hamsters.
The success rate of a first-time venture-backed entrepreneur is about 18%. If that entrepreneur fails and tries again with another company, their success rate only improves to 20%. Not much. BUT, if that entrepreneur succeeds in their first company, their success rate for their second venture goes up to 30% — over a 65% improvement in expected outcome.
A Hippocratic Oath For Software Engineers?
Think, for a moment, about the time it takes from when you wake to when you have a screen in your face?
If you’re anything like me that, time has dropped from hours, to minutes to seconds in the last few years. And tho we, as a startup community, celebrate apps as addictive the effects of these addictions are beginning to mark indelible train tracks across the soft tissues of our societies.
Some of these new markings are are wonderful and empowering. But, like any addictive substance, there are side effects that can become more and more pronounced over time. We talk of learning to program or be programmed, but that it actually happening under our noses. And the ranks of those doing the programing, tho small, are having an increasingly outsized impact on the world.
As the saying goes, with great power comes great responsibility.
So, it was with great interest that I read the recent proposal from Jonathan Harris calling for a Hippocratic Oath for Software Engineers. It’s a fantastic piece that I would encourage you all to read in its entirety, tho I’ve highlighted a few soundbites below.
He sets the stage for this importance of this kind of pact as follows:
We inhabit an interesting time in the history of humanity, where a small number of people, numbering not more than a few hundred, but really more like a few dozen, mainly living in cities like San Francisco and New York, mainly male, and mainly between the ages of 22 and 35, are having a hugely outsized effect on the rest of our species.
Through their inventions, they alter the behavior of millions of people, yet very few of them realize that this is what they are doing, and even fewer consider the ethical implications of that kind of power.
He continues:
On the Web, there are two main kinds of companies: marketplaces and attention economies. Marketplaces aim to eliminate urges by feeding them quickly (find a date, book a room, etc.), while attention economies aim to keep the urges going forever (continuous updates, another cool video, more new messages, etc.).
On the Web, where people have learned not to value things directly, the most common business model is to make a product, give it away for free, attain tremendous scale, and then, once you have a lot of users, to turn those users into the product by selling their attention to advertisers and their personal information to marketing departments.
This is a dangerous deal — not necessarily in economic terms, but in human terms — because, once the user has become the product, the user is no longer treated as an individual but as a commodity, and not even a precious commodity, but as one insignificant data point among many — a rounding error — meaningful only in aggregate.
Thinking of humans this way produces sociopathic behavior: rational in economic terms but very bad in human terms.
He contextualizes:
On a small scale, the effects of software are benign. But at large companies with hundreds of millions of users, something so apparently small as the choice of what should be a default setting will have an immediate impact on the daily behavior patterns of a large percentage of the planet.
He cautions:
In its capacity to transform the behavior of people, software is a kind of drug — a new kind of drug. As there are many kinds of drugs (caffeine, echinacea, Tylenol, Viagra, heroin, crack), so are there many kinds of software, feeding different urges and creating different outcomes. When designing technology, you should understand what human urge or condition you will be extending. So choose your urges wisely.
As the technology industry empowers “growth hackers” to aggressively increase scale, reach and engagement perhaps we need to be asking more questions about how our creations are impacting the lives of the people behind the eyeballs.
As with doctors who swear to uphold the hippocratic oath in their efforts to ethically practice and distribute medicine, is there a place for a similar creed for engineers designing a wholly different type of drug?
It’s not often you get to be a fly on the wall for an IPO roadshow, let alone the most highly anticipated IPO of all time. Yet, here’s our chance.
So, pull up a seat and listen closely to how Mark, Chris, Sheryl and David tell their story and lay out the rationale for why investors should believe that Facebook is just getting started.
There aren’t many reveals in the video that haven’t been covered ad nauseum so no need to listen intently for surprises. Rather, watch for how the story of Facebook is told from the seed planted in Mark’s dorm room on a $70 a month server to the single most important piece of internet infrastructure upon which all future applications will be built.
Regardless of whether such a wild eyed vision leaves you reaching for your Schwab account or your barf bag, this is 30 min of internet history well worth a watch.
It’s not the weekend, so I can’t make it required viewing, but miss this master class in big picture pitching at your own peril.
When someone says the word ‘pivot’, I’m like
Swear I had nothing to do with this.
