The world is turning against tech. Silicon Valley is in danger of becoming the new Wall Street – public enemy number one. And it’s easy to see why. Facebook is being used to influence elections and promote hate speech. Google is pressuring think tanks to fire people they don’t like. And meanwhile Uber has grown into one of the most obnoxious companies on the planet. That’s just the news in 2017. To that, you can add enduring concerns over privacy, the dangers of AI, losing our children to their devices, and perhaps most dangerous of all, a growing sense that tech is a leading cause of the growing inequality of wealth. Meanwhile, we are easy to ridicule.
All this has come as a bit of a shock to much of the tech ecosystem. Collectively we’ve been happily beavering away, content that our work is driving innovation, economic growth and job creation. We haven’t been wrong. Young companies are responsible for nearly 100% of net job creation.
We have, however, been in denial about the negative side of the massive growth in tech. It’s easy to be dismissive of privacy concerns as misguided (been there, got the t-shirt) but they matter deeply to a lot of people. Similarly, with kids spending all their time on their phones; there are pros and cons and it’s easy to focus on the pros – it’s truly fantastic that my children have all the world’s information at their fingertips.
But, as with most everything in life, tech has its good sides and its bad sides. What’s important is that we recognise that as a fact. Otherwise we aren’t listening to our critics, and so, in turn, they won’t listen to us. This was probably always true, but it’s pressing now that tech is such a large part of society. On 30 June this year, the four largest companies in the world by market cap were Apple, Alphabet (Google), Microsoft and Amazon. Facebook was number eight. Products of the tech industry are now everywhere, all of the time and it’s not surprising people are paying attention.
Our opportunity is to move to a more nuanced and honest dialogue. It’s important to continually re-emphasise the good that comes out of the startup ecosystem, mostly jobs and productivity growth. But in the same breath, we should acknowledge that some of the fruits of our labour are hurting us and need regulating. Perhaps more challenging is to recognise that change is scary to some people and that their opinion is as valid as ours. We should start to look beyond simply creating enduring companies, to how we can build technology and businesses which can have a long-lasting positive impact.
None of this is too difficult. Lots of the raw ingredients are there already. We have data on the positive impact that startups have on jobs and the economy and we have lots of great products and much-loved companies. AirBnB stands out to me as a good example that has hit a lot of scale, and there are literally thousands of smaller companies I could cite. We should continue to tell this side of our story much as we have been, but start thinking like members of society rather than tech advocates when it comes to issues like those listed above. That will be easier if we stop identifying with Apple, Google, Microsoft, Amazon and Facebook. They aren’t startups anymore. They are large self-interested institutions with a big influence on society which, inevitably, has its good sides and its bad sides.
If we don’t move to a more honest dialogue, we will end up in a shouting match with the rest of society, where neither side is hearing the other. There are important policy issues that we need to address and if we don’t go about it in the right way news like last Friday’s announcement from TFL that they won’t be renewing Uber’s license to operate in London will start to become the norm rather than the exception. I am hopeful that calm heads will prevail in that situation and more generally but that will only happen if we in the tech industry open our hearts and minds to the concerns of other parts of society.
From a recent Fast Company article about Satya:
Invited to participate in a Q&A at the Grace Hopper Celebration of Women in Computing, a major annual event, he told the largely female audience that women in the tech industry should forgo asking for raises and instead trust that the system would reward them appropriately. The negative reaction was swift, with attendees quickly tweeting out their pushback.
Nadella realized his mistake, and the next day issued an apology. “I answered that question completely wrong,” he wrote in an email to Microsoft employees. Today, he describes his onstage comments as “a nonsense answer from this privileged guy.”
But Nadella did more than deliver a mea culpa; he explored his own biases—and pushed his executive team to follow suit. “I became more committed to Satya, not less,” says Microsoft chief people officer Kathleen Hogan, the former COO of worldwide sales, whom Nadella promoted into her current role soon after the kerfuffle. “He didn’t blame anybody. He owned it. He came out to the entire company, and he said, ‘We’re going to learn, and we’re going to get a lot smarter.’
That makes me want to join Microsoft to follow him :). Very impressive.
This chart is from the UK government’s recently published Patient Capital Review.
I’m publishing it here because I often hear it said that the US startup ecosystem has a significant advantage over the UK and Europe because on this side of the Atlantic we are hobbled by a greater fear of failure. This has always annoyed me because a) I didn’t see it in practice, b) a certain amount of fear of failure is rational, and c) people used our supposed fear of failure to talk down the local startup ecosystem.
As you can see from the graph on the far right it turns out that fear of failure is roughly the same in the UK, the US, France and Germany.
It’s so good to finally have data on this topic!
Earlier in the year, there were a significant number of victims who came forward to share stories of sexual harassment by investors. Some of those investors were prominent VCs.
At Forward Partners we were really saddened by the reports – clearly, any abuse of an asymmetrical power relationship for sexual gain is wrong. Doctors have been held to a high standard in this regard for as long as I can remember and investors should be no different.
So a couple of weeks ago we adopted a new Code of Ethics for Sexual Harassment
, with a link at the bottom of our homepage and a new question in our FAQ
. The code identifies four different levels of sexual harassment and is based on a template
that TechCrunch published in July.
We don’t want to make a big deal of this announcement, but it is important that people know our code of ethics exists.
All feedback welcome and if anyone wants to copy or adapt our code for their organisation we’d love that too.
Getting value out of board meetings is tough. Lots of VCs have written posts with great tips – this recent one by Mark Suster is a very high quality example.
There are lots of reasons why value can be hard to extract – mostly to do with the fact that often board members don’t pay enough attention and CEOs don’t prepare as well as they could. However, today I’m going to write about a lesser known reason: the law of triviality.
From Nir Eyal’s What to do when someone steals your idea:
The British author C. Northcote Parkinson is famed for his “law of triviality,” first elucidated in a satirical article published in 1957. Parkinson writes of a committee assembled to approve plans for a nuclear power plant that instead spends most of its time arguing about a bike shed. The fictional committee wastes so much time on the bike shed because people are more likely to have an opinion on things they understand. While few feel qualified to speak about nuclear power, everyone can put in their two cents about a bike shed.
In board meetings this plays out with non-executive directors focusing questions on things they understand, often the accounts, but it can be any area of expertise – rather than what’s most important to the business at any given moment. On a lucky day the accounts might be the right thing to focus on, but usually the right thing will be something else, often something that is specific to the business and harder to understand and hence many shy away from. This scenario plays out most frequently with less secure or less experienced board members who have a need to be heard.
So what should we do?
As directors of companies we should try and catch ourselves when we dwell on topics that are in our comfort zone but aren’t the most important topics, and we should move the conversation on when other directors make the same mistake.
As CEOs we should identify the most important topics to discuss in advance and bring the conversation back when it wanders.