Calico. Because Rich People are too Important to Die.

The company-formerly-known-as-Google no longer needs to justify the cash burn of its unprofitable moonshots to shareholders. As Alphabet, it can give more airtime to cost centers like the death-defying longevity project, Calico.

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Calico was announced two years ago as a project with a mission to “cure death”. It seems that only rich people suffer from this peculiar ailment. Most of the world accepts the existence of death.

Are Google execs so bad at life that 70 years isn’t enough time for them? Is Calico seeking “life extensions” the same way that I request deadline extensions at work because I sometimes show up too stoned to remember my server password?

Life is special only because it is temporary. Just like Taco Bell is good because my family saved it for special occasions. Impermanence is what makes something an experience.

The absence of death is not life. It’s the equivalent of eating Taco Bell all the time forever. It’s purgatory.

Given the option of eternal life, few would decline, especially not with our loved ones watching. I don’t want that to even be an option.

Google, you’ve already ruined privacy for me. Please don’t ruin life as well.

How to Hire Insecure Overachievers

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“Our ideal candidate is an insecure overachiever.”

That’s what the McKinsey partner told me during my interview. Yeah, once upon a time I wanted to work at McKinsey & Co. They didn’t make me an offer. I was certainly insecure enough, but maybe not overachieving enough.

Not a secret: The people who go to work in management consulting and banking are insecure overachievers.

Insecure overachievers make great employees because they work long hours to win approval from authority figures. However, they are a very tricky species. They love prestige. They don’t like risk. They need social acceptance. Banking and consulting are not considered socially admirable professions these days, but remember – insecure overachievers don’t care what the 99% think. They need social acceptance from the 1% who matter.

They love structure and a clear path for advancement, but want to keep their options open. That’s the most important thing to an insecure overachiever: lots of options. It can never appear as though they have reached their final destination, because that would imply that they have exposed their maximum potential. As long as they appear to be in transition, they can claim to be holding out for something better.

The “up or out” policy instituted in law, consulting, and banking is perfect for insecure overachievers. Maybe McKinsey is just a springboard to an executive position at a Fortune 500 company, and Goldman is just a stop before partnership at a $50B hedge fund.

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As Wall Street bankers migrate to Silicon Valley, they bring their hiring practices with them. Insecure overachievers could never admit that their final station in life is a shared desk at Facebook. That’s why Google recruiters often tout this selling point: The best part about working at Google is the job you can get after you leave Google.

Because insecure overachievers need Google on their resumes before they are ready to start the next billion-dollar company.

Google gives new hires teddy bears and security blankets.
Google gives new hires teddy bears and security blankets.

See Also:
How Wall Street recruits so many insecure Ivy League grads –Vox

Silicon Valley is the New Wall Street

Once upon a time, Silicon Valley was a safe haven for socially subpar tech people. They lived in humble garages in the South Bay and built cool things for the sake of building cool things. The transistor. Apple I. Netscape.

Google HQ, 1998
Google HQ, 1998

The world loved the cool things they built. The geeky kids of Silicon Valley made money, lots of it.

Then the beautiful people showed up. MBAs and smashmouth capitalists. They wanted to build cool things too. Not for the sake of building, but to make money. They didn’t live in garages, because beautiful people don’t hide in garages. They live in high-visibility metropolises at the top of the peninsula.

More than 1,200 of Google’s 47,500 current employees formerly worked for one of the top 10 global investment banks, according to LinkedIn. The top banks also incubated at least 750 current Apple employees, 175 Facebook employees, and 260 Yahoo employees. Travis Kalanick, chief executive officer of the ferociously expanding Uber, has said that between 10 and 15 percent of his hires come from the financial services industry, with a full 5 percent coming from Goldman Sachs alone.

The new businesses don’t make users fall in love with their products. They churn out slick consumables that evoke the emotional connection of a quick handjob in a truck stop bathroom stall.

The Valley really is not so different from Wall Street. The core business model involves gambling with rich people’s money under the guise of wealth management. The startup founders, they’re just junior traders. They work 14-hour days and spend $2000 a month to carve out some sleeping space in a shared building.

Occupy Twitter
Occupy Twitter

And sooner or later, something will pop and the money will vaporize, because that’s what happens when everyone gets greedy. The Wall Street immigrants will return home, the San Francisco natives will get their rent-controlled apartments back, and it’ll only be a matter of time before the next hot spot emerges.

busillo

See Also:
Go West, Young Bank Bro –SanFrancisco

Don’t Rush the Cash Flow

TWTR crashed 20% last week after Twitter’s earnings report indicated a slowdown of user growth.

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The income statement, at first glance, would appear to be a winner – TWTR beat analysts’ revenue expectations by 12%, with reported earnings of 2 cents per share as opposed to the 2 cent loss that was expected.

Silly Twitter. You’re an internet stock, which means shareholders care about user growth, not cash flow. Every last cent should go towards making the fire burn hotter.

Remember, Facebook was founded in 2004 and did not become cash-flow positive until the end of 2009. Google was founded in 1998 and turned profitable in 2001, with the invention of Adwords. LinkedIn was founded in 2003 and probably didn’t become profitable until 2010.

Check out these gross margins:

Quarterly Gross Profit Margins, Dec 2013. Source: ycharts.com
Quarterly Gross Profit Margins, Dec 2013. Source: ycharts.com

Twitter, you have lower profit margins than Facebook, Google, or LinkedIn. If you are coming back with positive net income, you’re doing something wrong. Your cash flow is too strong. Get back out there and lose more money for your shareholders!

But only in the name of user growth, of course.

See Also:
Which Internet Stock is the Most Overvalued? –New Yorker

Hire the Engineers without Pedigrees

Stanford_Graduation

One of the biggest challenges of a technology startup is finding star engineers. There are plenty of them in the Valley, but we have to compete with companies like Google and Apple who dangle six-figure starting salaries in front of their prospects. Not to mention other employee perks and benefits.

Silicon Valley is a dog-and-pony show where pedigrees command a premium. In the last 3 years, 80% of the startups funded by the top five VC firms had team members from one of either Stanford, Harvard, or MIT.

But apart from investors, who cares?

McKinsey consultants began advocating the War for Talent in the late 90s dotcom boom. With no real metric for measuring talent, managers deferred to the US News rankings of the applicants’ alma maters. This standard has persisted into the present.

McKinsey also advised Enron to recruit the best and brightest. Remember Enron?

Emboldened by the mantra of A players, Enron created an undisciplined, narcissistic company that believed it was too talented to fail.

Enron succumbed to a culture of dishonesty because no A-player was willing to admit failure in a company that was too talented to fail.

Startup employees need to be ready to fail. And they need to be honest when something fails.

The highest-pedigree employees are particularly averse to failure. They probably haven’t had much practice at it. Nobody goes to Stanford for a PhD in Computer Science because they want to embrace risk.

Star engineers don’t even necessarily make the best employees. Intel hired me because I’m a stellar circuit designer, but I spent most of my workdays watching cartoons or hiding in the bathroom. No amount of pedigree can make up for a lack of motivation.

In a startup, anything less than committed passion is death. Will that Stanford PhD you hired remain loyal in your startup’s darkest hour – even with Google recruiters knocking on his door?

Last week, Seth Godin made a case for having a war for attitude, not talent. Motivation and honesty trump skills and talent any day. Cal Newport says that the ability to focus will be the superpower of the 21st century. These three things are all harder to find than an Ivy-League diploma.

You don’t need a degree from Harvard, Stanford, or MIT to be able to focus and yield a positive attitude.

There’s a good argument against purchasing pedigree dogs – they come from a limited gene pool and are often inbred. The same applies to hiring pedigree engineers – get all your employees from the same three universities and your company becomes inbred, narcissistic, and diseased.

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