Snap Inc’s beguiling IPO left me with that fuzziest of sensations; Déjà vu all over again.
As the tech universe was being whimsically swept away by the largest IPO in LA history, my brain revisited a passage in Nick Bilton’s recent New York Timesreview of the books Valley of the Gods: A Silicon Valley Story Hardcover and The Kingdom of Happiness: Inside Tony Hsieh’s Zapponian Utopia:
"It isn't so much that I didn't like both of these books as much as I didn’t like the people in them,” Bilton writes. “They, frankly, come across as self-centered lunatics who are intent on making a dent in the universe, without an ounce of self-awareness for the repercussions of how those actions could harm others. While the books do have some skepticism, more often than not, they read as though the authors consider their subjects to be gods, not mere mortals who just happened to be good on the computers."
Just as Bilton says, days after Snap’s debut on the New York Stock Exchange, my news feed seemed to be working overtime in an attempt to solidify 26-year-old CEO Evan Spiegel’s status as the Demigod of Venice Beach. Armed with his fiancee supermodel Miranda Kerr, Spiegel and co-founder Bobby Murphy quickly rose to the top of tech’s kingdom with eyebrow-raising stories of supposed bravery and brashness. After all, these are the same whiz kids who turned down a $3 billion acquisition offer from Facebook in 2013 when Spiegel was just 23 years old, resulting in Forbes calling him “the brashest tech wunderkind since, well, [Mark] Zuckerberg.” But these are also the same guys who started a company that lost more than half a billion dollars last year. A company with no clear business plan or revenue model. A company that seems to have spent more time making a celebrity of its CEOthan preparing for a proper IPO.
And yet, the madness ensues and no one calls out these “lunatics” so-to-speak, mostly because everyone in Silicon Valley is busy catering to their own narcissism and lining their pockets with cash. Even the investors think they’re changing the world, while of course, getting rich in the process. And that’s exactly how tech nerds – not gods – tumble down from their happiness kingdom. Because there’s no vetting, we end up with dizzying consequences like once lauded biotech Theranos which, at one time, was said to revolutionize the $50 billion blood-testing industry. With just a microscopic drop of blood from the finger, instead of the typical venipuncture required, Theranos claimed it had developed blood analysis machines that could test for hundreds of diseases. Another I’m-changing-the-world-kind-of-business that was making a lot of people’s wallets very fat. In 2015, a year after Theranos struck up a goldmine of a partnership with Walgreens and CEO Elizabeth Holmes ended up on Fortune magazine’s cover, John Carreyrou of The Wall Street Journal published a front-page story alleging there was no proprietary technology, no revolutionizing of an industry, no $9 billion valuation. What there was was a sham of a company that used its competitors’ equipment and had major accuracy concerns. After being touted as the next Steve Jobs, Stanford drop-out Holmes’ world fell apart and federal prosecutors quickly came sniffing. Shortly after Carreyrou’s WSJ article, Walgreens bailed and federal regulations banned Holmes from owning or operating a medical facility for at least two years.
It’s mind boggling to think that there was no point in time while investors were busy pouring $400 million into the company did someone to say, “so, how does your technology work?” or even a “can I see your lab results?”
The similarity in all of these companies is that there’s no one willing to call out the bullshit. Everyone’s busy getting rich. Even when Snap's seemingly anti-reason meteor of a stock took a nosedive in its second week of trading, it bounced back on what felt like the wings of dreams to hit a new high in its third week of trading. So apparently even when we see the faults in companies like this, we just dig deeper into denial and create a new fantasy about the dashing young tech CEO.
As a society, we’ve committed this disastrous mea culpa time and time again, building someone up to instant bonafide celebrity status. We give them powers, and pretty soon, they start thinking they can do no wrong because they’re surrounded by yes men and women.
In Bilton’s review, he writes about these yes men and women. He writes about his frustration with Alexandra Wolfe, a reporter for the The Wall Street Journal, of her portrayal of Silicon Valley as “mystical and magical, worthy of a place in history and something akin to the Greek odes to Aphrodite and Dionysus” in her book Valley of the Gods. He questions Wolfe’s decision to laud billionaire Peter Thiel as a genius who made billions on companies like Spotify and Lyft, yet also failed to note that his hedge fund Clarium Capital “faltered badly with misplaced bets during the Great Recession, or that Thiel’s support for Donald Trump had made him largely persona non grata in Silicon Valley.”
Yes, we need intrepid leaders, willing to take ambitious risks to change the world, But more than anything else, we need someone ready to step forward and say, ‘What’s your business plan, bro?” the next time some whiz kid wants to drill through the center of our Earth. Let’s just hope we all snap out of it soon.
Vivian Giang is a business writer on workplace trends, women-focused industries, technology and the human brain...and whatever else she finds interesting about work and play.
You can find her on twitter @vivian_giang