Venture Ethics

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Fred Wilson, the well known technology investor and all around inspirational guy, wrote a blog post yesterday titled Ethics and Morals. In it, he wrote about a Venture Capitalist who turned down an investment opportunity with a company, and shortly thereafter provided an angel round for his son in a competing business.

There are more details, and the entire post is worth a read.

But one of the things with the post is he didn’t actually name the name of this venture capitalist. And that’s fine I suppose, but it prompted me to ask this:


I asked the question because this isn't the first time I've heard an investor call another investor out in public, without actually calling them out.

I recall Dave McClure calling out investors for blocking early stage investors from participating in follow on rounds (another thing Fred Wilson's written well about here), for example. 

There too - no names.

What I'd like to argue is that these public announcements, in and of themselves are problematic for entrepreneurs, are counterproductive to the investor's goals of attracting the best entrepreneurial talent, and underscore the very reason why people like me don't trust investors. 

To be clear, I don't mean this in the "I don't trust them personally" kind of way. My guess is they're both probably pretty awesome, their firms are the best in the biz, etc. I think they're the 'good guys' is my point. 

And also, Fred does yoga!

What I mean is, I don't trust their industry, and these non-outing outings help explain why.

To be good it seems to me investors have to simultaneously compete with each other, and collaborate with each other. This is so much grey for someone like me I can barely take it. And I don't mean this in a positive way about myself, I just mean it just sounds so damn hard.

But all I see when I read these non-outing outings is the fact that it's more important to protect the investor to investor relationship than it is to warn entrepreneurs about the shady investor.

And look, I get it.

I actually changed my mind in the process of writing this post about whether it was 'right' or 'wrong' not to mention names. We've had numerous investors reach out to us about Tula, while proudly including the fact that they invest in our main competitors. And all I can think to myself is: someone who wants to invest in us might be reaching out to our newest competitor in three years?

But I don't want to call these people out either.

What I initially thought was irritation that these investors weren't naming names is actually touching something deeper. How these dots connect for me now, is they highlight very clearly that there is an investment world, and there is an entrepreneurial world and in between there is a chasm of trust.

It makes me sad when investors I like and follow and admire are contributing to making this chasm larger instead of smaller, especially when they are each usually doing the latter.

But the fact of the matter is that they both have had a situation where they've fired shots across the bow at other investors, using a dog whistle instead of a bull horn, while on just about every other industry related topic they are talking openly and in public.

I think it's great that we're talking about ethics, but let's be clear, these are venture ethics, which still leave some open questions for the entrepreneur.

 

We don't want to be anonymous, we want to be known for the first time again

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I think sometimes about what kind of effect the internet will have on us, and in particular our children, as it becomes harder and harder to move away from our pasts.

I don't mean this in a 'running away from our past' dramatic kind of way. I mean it more in the spirit of, when we graduate from grade school, and then high school, then college and maybe a job or two, we end up sort of refining ourselves along the way.

When you go to university, it's sort of nice to meet someone who didn't know you when you had your most embarrassing high-school moment. When you take that first Director level job, it can be welcome if your new reports haven't seen you pass out at the Christmas party because you can't handle your whiskey.

Not that I would know anything about that.

The idea is that as we move through life, as we naturally transition from one period to the next, we bring some of ourselves forward with us, and we leave other parts behind. We learn and grow and mature and hopefully, who we are at 40 is a better version of who we are when we're 20. 

What happens though when it becomes hard, or impossible, to leave our more unrefined selves behind? 

There's a concept in psychology called the "Looking glass self" that says our self perception is based at least in part on how others perceive us. This notion is so powerful that people can have important breakthroughs with issues such as addiction, simply by seeing a new person in their lives perceiving the in a positive way.

If you think about it, this makes sense sort of intuitively. If you were suddenly treated like a movie star, allowed into all the greatest clubs for free, fashion designers sending you clothes for nothing and you had people hounding you for autographs - you'd probably have at least some shift in your sense of self. Likewise, if everyone started being very mean to you, telling you were worthless over and over again, this too would have an obvious impact.

But what happens when people's perception of us is based on 10 years of a Facebook timeline and 8 years of a web log? Is this simply our reputation, something that everyone in every generation before us has worked with?

Or does this always available history have an influence on how we're perceived? And if so, then doesn't this mean we'll perceive our own selves differently than we otherwise might have? And what happens when we're comparing our real world selves to other people's Instagram filters?

What is this doing to our perception of self?

There was a trend in 2014 with anonymous apps such as Secret and Whisper seeing massive user growth, and for many there's a strong belief that many people have a craving for an anonymous presence on the internet. But I don't think anonymity is the thing we want. Anonymity is the thing we want so we can get the actual thing we want - which is to be know by someone else for the first time again. 

Anonymity is just a pre-requisite for that.

The always on, always searchable, history always available nature of the internet is amazing and important and a regular thrill. But as with everything, there are trade-offs, and the internet has made it significantly more difficult to be known for the first time again.

I've become of the mind that anonymous apps aren't trying help us be evil or wicked or dangerous, or even anonymous, though surely there are some that use it for that.  Instead, I think they're trying to help us scratch the oldest of itches: to provide a way for new people to perceive us, so that we can have more inputs so as to build our own self-perception. A few of us want to be anonymous, but most of us want to be known.

If we can be know by someone for the fist time again, then even better.

 

The most important metrics are impossible to measure

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The most important metrics are impossible to measure.

Of course, this doesn't mean nothing should be measured. And it certainly doesn't mean we can't gather important insights by measuring the things that can be measured. Avoiding the important work of measuring the measurable is neglect indeed.

But the very most important things, they cannot be measured.

How do you measure delight? How do you measure the number of people that signed up because of the one rabid fan that can't stop talking about you?

In a world where everyone is inundated with everything, how do you measure the impact of a billboard that sparks brand recognition while listening to a podcast sponsorship which reminds you to google something which causes you to click on an ad?

The truth is that now more than ever, insights are what matters.

Deep domain knowledge, the ability to weave things together and an ability to create solutions to problems that other people don't know exist are valuable precisely because they require insight.

The other thing to keep in mind is that 'not measuring' something doesn't mean 'neglect'. It means approaching something from a different angle. Maybe it means instead of doing a survey of customers about a feature, you have two in-depth conversations with your longest customers.

In a world where more things are becoming more measurable, I think it's wise to take a step back and think about the that which cannot be measured, and think about the kinds of inspiration they can provide.

Oh no, it worked!

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The only thing scarier than failing is succeeding. (Note that I said scarier, not worse.) Because every success takes you to the next level. There's no finish line, the stakes just keep getting higher.

Now that it worked, now what? There are real people counting on you now. Your investors expect a return now. Your employees are buying houses.

You're not experimenting, you're executing. 

If you go down, real businesses stop. 

You matter.

Now what?

This is the idea that pays for the bad ones. This is the one that justifies your philosophy. And it's success will enable more success, or so you think.

It worked. 

But it's not done.

Now what?

The tools I use every day as a web developer

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As web developers, we use so many different tools everyday. We can easily forget about everything we depend on. In the spirit of the new year, I want to take a moment to recognize all of the great products and projects which help me be the best developer I can be.

There's a saying out there, "You're only as good as your tools." (1) (2) This rings true in many different professions and in life. Tools that make you better at what you do are generally a great investment - typically risk free.

Here are my favorites. I use these every day, if not, every week.