It probably feels weird because it attempts to tell Zhu's side of the story, and he still manages to come out looking bad. Investors made the right decision, it seems.
I think Zhu is saying that he was fired because of his Asian management style. His partner's management style was not described, so it could be that his partner's style aligns better with what the VCs are used to.
Andrew Boni doesn't sound like an East Asian name to many people, though it certainly could be. A quick google search indicates he also looks less East Asian than Justin Zhu.
Edit: Since someone seemed to be irritated with my comment enough to downvote, people just with East Asian names have been known to suddenly face less discrimination once they started using non-East Asian names, or be characterized as non-East Asian after changing their names to something non-Asian.
Some notable biracial (White/East Asian) Hollywood actresses with ambiguous racial characteristics have had to change their East Asian sounding name to a white name to get roles, or non-typecast roles. For example Sandrine Ho (of House of Cards) changed her name to Sandrine Holt and suddenly got more callbacks.
Everyone looks bad here, to me. Zhu seems like a weirdo (who thinks it's a good idea to try your first LSD microdose right before a big meeting?), but the investors also seem like they were manipulative and removed him for somewhat arbitrary reasons.
If you're arrogant enough to experiment with microdosing the first time (or one of your first times) immediately before a critical moment in your life, you're asking for trouble.
I've done similarly and taken similar risks - and I'm lucky enough that the combination of my prior experiences with the stuff and luck in the moment helped see me through my troubles.
But if it hadn't, it would've been painfully obvious I'd shot myself in the foot and would need to confront the choices that led me to being able to make such a stupid one.
"He wore cargo shorts and a T-shirt to a meeting with Geodesic, a VC firm founded by John Roos, a former U.S. ambassador to Japan. An Iterable board member later informed him Geodesic wouldn’t invest, implying it was partly because of his casual attire."
Seems petty. Surely VC firms have had to look past appearances before. Of course, it did say "partly"...other things could have transpired in the meeting.
I think that depends on the type of VC or the particular partner at the VC. Especially the ones that invest in later stage rounds and enterprise software companies. They don’t appreciate flip flops and hoodies. I think it is always best to err on the side of “conservatism” if you want to raise money. Obviously there are many VCs who talk openly about their regrets in missing out on rocketships like Facebook because of Mark Zuckerbergs arrogance.
It just doesn't seem to have any benefit for the VC, to me. It's not really an indicator of anything useful. They wouldn't have scheduled the meeting if the meaningful stuff wasn't more important than flip-flops.
Wow talk about projection. They fail big time at their job after engaging in petty gatekeeping and then declare in a goddamn high publication count article the investment arrogant?
The employee who rejected J. K. Rowling's Sorcerer's stone manuscript for being too long didn't try to say it was her fault for making it too long and that is why the company missed out on the first billion dollar author.
If you have to pull millions of dollars out of your own pocket to invest into a company led by someone that doesn't care enough to dress at least business casual... I can understand thinking twice about that.
Maybe the pitch wasn't even that convincing, the cargo pants were just the cherry on top.
Personally I think caring about how they are dressed for anything less than "covered in bodily fluids and/or naked" is stupidity normalized. It is not only a superfical distraction from the relevant and "bike shedding" but literally asking to be deceived and selecting for people who can deceive you best.
Dressing appropriately is short-hand for "I speak your language. I understand cultural norms and can adhere to them. I won't embarrass you in front of your peers and clients." If you don't dress appropriately, they will have to find out all those items through discussions with you, and it definitely adds a hurdle to any initial discussions.
Yeah, it is a game. Dressing up is just playing the game, to show that you're one of the boys. But you know what? It's also an extremely low-hanging fruit kind of game to play, so why not? What do you have to gain by refusing to play that one, when what it might take is a few hundred bucks and an afternoon going shopping?
If the business and team were phenomenal, the attire wouldn’t have mattered.
However, dressing appropriately for a meeting is an easy way to demonstrate that the person is taking the situation seriously and being respectful of the other parties. If someone can’t make the effort to dress appropriately for pivotal VC meetings that decide the future of their company, it’s likely they won’t bother taking other meetings seriously either: Meetings with customers, partners, recruits, and so on.
As a VC, you don’t want to fund someone who will go around being disrespectful, intentionally or otherwise, thought your network. We like to glorify the exceptions like Steve Jobs, but the reality is that dressing appropriately to show respect for your business partners is a fact of life.
In 2021, it’s cheap to dress in a presentable manner. You don’t need a suit and tie (west coast, anyway) but you do need to make a basic effort.
Yes. I saw a presentation by the CEO of Western Digital. He was dressed in a polo shirt and blue jeans. But he was in fact very well dressed and if I were in a Brooks Brothers suit, he would have looked more professional. His presentation was effortlessly on point. I don't think he microdosed before the meeting. Moreover, I thought after the presentation, yeah, I want to work for that guy.
I don't think dress has anything to do with this firing.
I think there are nuances beyond just the type of clothing. I would guess that the CEO of Western Digital was wearing clothes that were well-fitting, of a modern cut and style that showed he was aware of trends, and of a quality that indicated expensive clothing. This was probably paired with a nice leather belt and dress shoes, matching socks, and perhaps a nice analog watch. Also, he was probably clean-shaven and had styled his hair. Now, if you told me he looked like RMS on a bad day and still looked more professional than you in a Brooks Brothers suit, I would be really surprised.
I once worked in a building and got to be friends with the CEO of a medical tech start up. He dressed like shit everyday, literally had his toe poking out a hole in his shoe. One day he’s dressed impeccably, not just a suit - but a well tailored, very sharp one. I asked what the occasion was and he gave me some of the best advice ever: “I’m going to ask investors for money today and if you want people to hand you money you need to look like a guy people hand money to.”
It's not about clothes, it's about signalling preparation and respect.
When Bill Gates and Paul Allen were preparing for their life changing meeting with IBM, they knew that IBM has very strict dress code, so they dressed in conservative IBM style suits. At the same time IBM executives wanted to make these young unknown west coast guys comfortable and decided to wear relaxed and informal attire breaking their own dress code.
When the two groups met, they busted into laughing. It was funny but also made it clear that both were serious and wanted the deal succeed.
One of the big things a CEO does is meet with people to sell the company, make deals, connect with investors and all that. You need to be able to read social situations properly, and if you can't do that, you are at a disadvantage. One way of demonstrating that you can handle social situations properly is knowing what to wear.
A really talented CEO might be good enough to overcome "quirkiness" on the "dress-the-part" side, but you have to have sufficient other advantages.
> "He wore cargo shorts and a T-shirt to a meeting with Geodesic,
people who run the core routers of the largest ISPs on the planet regularly show up to meetings in cargo shorts and t-shirts, believe it or not. They're responsible for things much more critical than some overly-valued advertising/consumer promotions marketing firm.
There's no shame in taking LSD or being fired from the company you helped found because you think different as Steve Jobs might say if he were still alive. It's almost the ultimate homage to Jobs. I'm sure Zhu will be fine. I can't talk to people on LSD. I'm surprised no one told him about set and setting.
>Believing that limited quantities of LSD would improve his pitch, Zhu, who had never before used the drug, decided to try the microdosing plan. He took what he thought was a small amount of LSD shortly before the meeting.
Taking a "small amount" LSD for the first time in your life, right before an important meeting, in the vain hope that it will improve your pitch, when you don't even have any idea how it will feel, or what it will do to you, or how long it will last, or even how to medically define and accurately measure a "small amount" of LSD, is astoundingly idiotic and irresponsible.
Is that how he runs his whole company? Why bother with development and staging servers? Just log in as root and hack away on the production server!
If dosed correctly (it takes time to find it and depends on the person) micro-dosing (usually around 5 - 20 ug per dose) an obvious effect in not as apparent as you might expect.
For me, 5 to 10 is enough. I don‘t actually want to feel the body high when microdosing. Precisely because it should feel like a normal day. Except your perception, creativity and emotional balance is heightened.
Microdosing is actually one of the best things to help with speaking to large groups or presenting ideas. The increase in creativity and mental clarity helps you make more eloquent points and respond well to questions.
I have anxiety and it's helped me. This is all anecdotal but my experience lines up with thousands of others in the microdosing community. The clarity also seems to come from living more in the moment and not always half fretting about the future.
> The increase in creativity and mental clarity helps you make more eloquent points and respond well to questions.
Is there any science to back this up? The increase in confidence from alcohol makes me dance better... from my perspective, at least. I've read the "productivity boost" from ADHD drugs is similar. It feels like you're doing more/better but you're really doing the same.
That is exactly the problem. They cargo cult Steve Jobs' personality, fashion or some other aspect, but they don't deliver Steve Jobs kind of results. It ends up being cringey at best and disastrous for their company at worst.
I have seen this before with CxOs and owners who decided their company would be "just like Apple" and they would be "just like Steve Jobs". They read how Steve Jobs was an asshole, so they just started acting like assholes towards everyone waiting for the fame and fortune to follow.
I don't admire Steve Jobs's personality, but I find myself talking about him all the time, for two reasons:
1) Steve Jobs had a vision for the appearance, function, and marketability of his products, and enforced his tyrannical will on his team until that vision was met, or at least it was impossible to enforce any more. The fact that his vision changed along the way or that he was inconsistent at times isn't as important as the fact that he was a central authority that was allowed to keep the resultant products consistent and stable. People who try to behave like Steve Jobs rarely have the level of vision that he did, and mimic his behavior rather than his principles.
2) Everything the teams under Steve Jobs produced has been cargo-cult mimicked ad nauseam by people today, to the point where every modern software looks like someone tried to redesign Apple software from memory. Unfortunately, it all sucks (compare Jira to Windows 95 Email in terms of form and its relation to function).
I hadn't realized this, but one of the reasons I don't have much respect for Elon Musk is he sells himself like he's Steve Jobs, and he has the asshole thing going, but he doesn't have the focus, obsession with detail, and micro-executes, not micro-manages.
I don't get the sense the EM sells himself as SJ, but some of he people I know that have worked a few levels under him definitely don't have the same kind of awed respect SJ's acolytes did, although they respected him a great deal.
I think it's one of the most important concepts ever noted down. It's applicable to every learned behavior. Are you mimicking behavior, or are you understanding principles?
I think (1) works best when your vision is coherent and consistent. People familiar with it should be able to explain it well themselves, and predict with some reliability whether a given product or experience will meet expectations.
In this case, the vision is unifying and improves your ability to execute.
If the vision is not coherent or consistent then you lose the ability to execute without micro-management. Staff will be unhappy because they feel subject to the whims of an unpredictable dictator.
You can have both experiences in the same company if there are some people who "get it" and other people who don't.
I couldn't agree more. Coherent vision at every possible level of the company will add more value than "hard work" or a dictatorial fanatic at the helm ever could.
That's not only with Jobs. There are some brilliant people who are assholes - and many brilliant people that aren't. But the assholes get the headlines. So people decide "I want to be brilliant, why don't I start with being an asshole? Seems like the easiest way..."
The most damaging legacy of Steve Jobs is convincing millions of people that if you’re a genius you have a right to be a huge asshole; and conversely, if you’re being a huge asshole it must be because you’re a genius.
Trying a new drug for the first time right before a high-stakes meeting sounds incredibly stupid. Couldn't he just allocate a week-end to test it out beforehand?
But I don't think he was fired just for that...
Not to mention that LSD does not make you better at communication while on it.. Isn't the trope that leaders go on a hiatus and do LSD for ideation, not for performance?
>The Psychedelic Inspiration For Hypercard, by Bill Atkinson.
>In 1985 I swallowed a tiny fleck of gelatin containing a medium dose of LSD, and I spent most of the night sitting on a concrete park bench outside my home in Los Gatos, California.
>I gazed up at a hundred billion galaxies each with a hundred billion stars, and each star a giant thermonuclear fusion reaction as powerful as our Sun. And for the first time in my life I knew deep down inside that we are not alone.
>I knew that life on planet Earth is not the only pocket of consciousness in the universe, and likely not the most advanced. But we still have a role to play in the unfolding drama of creation.
>It seemed to me the universe is in a process of coming alive. Consciousness is blossoming and propagating to colonize the universe, and life on Earth is one of many bright spots in the cosmic birth of consciousness.
>But the stars are separated by enormous distances of darkness and vacuum, which may hinder communication between them. I lowered my gaze and saw the street lamps below glowing brightly, each casting a pool of light but surrounded by darkness before the next lamp. As above, so below.
>The street lamps reminded me of bodies of knowledge, gems of discovery and understanding, but separated from each other by distance and different languages. Poets, artists, musicians, physicists, chemists, biologists, mathmeticians, and economists all have separate pools of knowledge, but are hindered from sharing and finding the deeper connections.
>My vision distorted by thick eyeglasses, I witnessed the curvature of the Earth’s horizon, and I felt the pull of gravity toward its center, such that every one of us is standing at the very apex. Each of us stands at the top of planet Earth, and each of us is a leader or captain of the “Blue Marble” team.
>How could I help? By focusing on the weak link. If I were captain of a soccer team, I would look for the weak link and work on it. If the goalie was letting too many through, I would spend extra practice time with him, and the whole team would prosper.
>It occurred to me the weak link for the Blue Marble team is wisdom. Humanity has achieved sufficient technological power to change the course of life and the entire global ecosystem, but we seem to lack the perspective to choose wisely between alternative futures. But I was young, without much life experience or wisdom myself.
>Knowledge, it seemed to me, consists of the “How” connections between pieces of information, the cause and effect relationships. How does this action bring about that result. Science is a systematic attempt to discover the “How” connections.
>Wisdom, it seemed to me, was a step further removed, the bigger perspective of the “Why” connections between pieces of knowledge. Why, for reasons ethical and aesthetic, should we choose one future over another?
>I thought if we could encourage sharing of ideas between different areas of knowledge, perhaps more of the bigger picture would emerge, and eventually more wisdom might develop. Sort of a trickle-up theory of information leading to knowledge leading to wisdom.
>This was the underlying inspiration for HyperCard, a multimedia authoring environment that empowered non-programmers to share ideas using new interactive media called HyperCard stacks.
>Each card in a HyperCard stack included graphics, text, interactive buttons, and links that took you to another card or stack. Built-in painting tools, drag-and-drop authoring with a library of pre-fab buttons and fields, and simple event based scripting made HyperCard flexible and easy to use.
>It took a lot of hard work and a dedicated team to ...
Figuring out how to deal with non-destructive microdosing on company time might be a tough call. If he's a genius and this helps him achieve his full genius-hood, then maybe it's tolerable.
But microdosing -- and getting the dose wrong! -- puts him in a whole different category. That's just a fundamental inability to act sensibly in risky situations. The board doesn't need to wait for the second example.
He founded a company worth billions - if he was constantly showing up high, sure. Getting dosing wrong, once? As long as he learned from the experience, who cares?
This is the kind of incident that plays well in the press, because it generates headlines - like becoming the first word of a headline.
Do we really think that the board was so gosh-darn offended that their founder did the wrong LSD dose, once? Or, that there were long-standing disagreements over strategy, direction, and tone?
The latter is harder to justify in the normie press, so they're trying to crucify him over some minor incident.
He didn't exactly make a small dosing mistake, though. I can understand accidentally taking 50ug by accident if you're not careful.
But he was peaking on much more than a light dose, here!
Zhu looked at the screen and saw numbers and images swelling and shrinking, making them impossible to discern.
His body felt as if it were melting away, he says
That is far from a microdose. This is showing up extremely drunk to the office.
As an occasional LSD user, and I can only speak for myself, but I don't ever get enough visuals that I can't read a screen without taking way too much, or without other drugs being involved that have a synergy with LSD.
Would the anxiety of realising you're tripping way more than you intended not potentially result in the effects feeling a lot stronger than it otherwise would feel?
Mentally, probably. I think would have trouble speaking coherently long before the visuals became a problem, but then again everyone is different.
It's not my experience that visuals get much more intense with anxiety.
With how long trips and the comeup take, I just have trouble understanding what kind of confidence it must take to walk in the meeting anyways and try to wing it. I would have found any excuse to sober up and get things in order before drunkely stumbling through a big pitch.
Getting visuals while looking at a computer screen can definitely happen at small doses. You might not see any visuals looking at the space around you, but black text on a bright white screen will bring it out.
And mixing up the dosage is insanely easy with LSD, especially if you are using tabs since the LSD isn't evenly distributed throughout the paper. Also, you never really know how much LSD is on your sheet or in your vial, you just have to trust your source.
Yeah, not saying it would. Even at higher doses you can usually read a screen, but the many other psychological effects will make it hard to process what you are reading. Especially, if you aren't experienced with it.
My point was that seeing visuals on a screen doesn't necessarily mean it's a large dose, especially for a first time user. Definitely not a microdose, but getting the dosage right is an art.
I know quite precisely how much alcohol is in commercial beer that I buy. I wouldn't have even a single beer immediately before an important investor meeting.
you're doing it wrong. first you drink all the booze. then you hack all the things. if your investors aren't down with that, they're in the wrong line of work. maybe they should consider haberdashery.
Not defending his actions, quite the contrary actually, it's really easy to get it mixed up so I wouldn't recommend it unless you've done it a bunch of times and know yourself. Even then, that really seems like the worst time to do it.
I can't even imagine how he thought this was a good idea. Maybe microdosing in your private office during a 3 hour block of solo time when you just want to think by yourself... but microdosing (for the first time) before a board meeting where you're expected to give a presentation?! Horrible idea.
If they are a CEO and they do that just before a big investment meeting to the point that everyone notices something is wrong and someone else has to take over the lead. All of that when you know your current investors are trying to reduce the risk of the company.
You'd probably be in trouble.
And if on top if that you would be freely talking to the press about various issues even after the board has asked you to stop it.
You'd be fired. Which is exactly what happened here.
If your company is big enough to think going public, "Let's try LSD just before a big meeting" is not exactly the kind of idea you want your CEO to have.
I hope society figures out how to make startups in general less capital-dependent. If there weren't investors trying to protect themselves, we'd find out if running a company in Zhu's manner works or doesn't.
Anyone that's ever worked part-time knows the "we have to send you home because if you work anymore this week you might be considered full-time by Uncle Sam and that's bad."
Another thought is throughput. If welfare wasn't so closely tied to employment, working relationships could then be more ephemeral until one found a best fit. This may also look like more cautious hiring, which directly leads to missed opportunities for all parties.
Edit:
Capital buys employees, but it also buys time. For every extra dollar an employee costs the amount of time it takes to make the decision to hire that employee also increases. An efficient job market would compensate based on contribution, which is a lot more possible if a significant amount wasn't mandated to be spent, and then guilted into continue spending because, you know, you don't want to take away someone's welfare.
I stumbled on a really good job posting this weekend, which I’m 100% qualified for and am sure I would have a really good chance of getting, but the last sentence was “We currently don’t offer health insurance.” Based on that alone, I had to slunk away.
A proposal to do exactly that. Critically, it phased out incentives available to corporations that provide employee healthcare in favor of tax deductions for individuals that purchase their own healthcare. During the transition period, employers would subsidize private plans purchased by their employees.
While I support medicare for all, there needs to be a transition. There are probably hundreds of thousands of people involved in insurance that need to find new work.
If there were an adequate social safety net, specifically a universal basic income, then employees could be paid in equity if the employer wanted to conserve or did not possess cash.
The whole "microconf"/bootstrap crowd works in a growing space with fewer capital needs. I think they fly below the radar in a lot of ways, but that's probably not a bad thing for them.
But this notion is incompatible with capitalism itself.
The idea of capitalism is that capital accumulates in the hands of those who figure out how best to deploy and protect it. Investors, not Zhu, are the ones with the track record and experience.
Trusting them to be stewards of capital is a better bet than trusting an eccentric, unproven founder who decides to experiment with LSD for the very first time before a big pitch.
If Zhu had managed a successful exit, he would have established that track record, accumulated some capital of his own and bought himself the leeway to be as eccentric as he wishes in the future. See: Elon Musk.
I'm not suggesting that startups be given free capital; I'm suggesting that we find a way to make capital less necessary, i.e. lower the stakes.
At the extreme, if starting a company only requires pocket change, then nobody (society, investors, or anyone else) has much to lose in letting an unproven founder do their thing.
There are many, many successful bootstrapped software businesses out there. It's not as though founders in this industry don't already have a choice about whether or not to seek outside investment, and to consider all the relevant tradeoffs.
In what ways could capital be made less necessary?
> In what ways could capital be made less necessary?
By reducing the cost of anything and everything that startups spend money on.
(And for the largest item in many budgets, namely employee costs... in the presence of an adequate social safety net, cash-strapped startups could pay employees in equity rather than cash, and they could stick around for as long as they thought it might be worth something in the end).
Somewhat separately, what struck me from the article is that Zhu's controversial moves generally didn't involve bad business decisions, but rather failing to impress investors at a moment when the company needed the money. It would be better if that need for money were reduced, and we could all see how this type of experimental style turns out.
If dosed properly, it could have made a substantial positive impact. Certainly there is risk involved, but then most things are risky when running a business. Going for safety leads to employment, not to running a company.
Do you believe taking a psychotropic drug for the very first time before a big pitch--before having any sense of what a proper dose might be--is on the the reasonable side of the spectrum between "risky" and "reckless"?
> before having any sense of what a proper dose might be
Did he really not have _any_ sense of a proper dose? Seems unlikely.
I will say that hiring people who are risk averse is great for middle managers who will say NO to most opportunities because they're more afraid of failure than they are interested in opportunity.
I'm sure this article only tells 10% of the story from both sides, but the fact remains that some people entrusted him with his money and that his behavior made them uncomfortable, which ultimately made them remove him from the position. I find all of this unsurprising.
Such is the story of the Mexican fisherman and the harvard MBA:
An American investment banker was at the pier of a small coastal Mexican village when a small boat with just one fisherman docked. Inside the small boat were several large yellowfin tuna. The American complimented the Mexican on the quality of his fish and asked how long it took to catch them.
The Mexican replied, “only a little while. The American then asked why didn’t he stay out longer and catch more fish? The Mexican said he had enough to support his family’s immediate needs. The American then asked, “but what do you do with the rest of your time?”
The Mexican fisherman said, “I sleep late, fish a little, play with my children, take siestas with my wife, Maria, stroll into the village each evening where I sip wine, and play guitar with my amigos. I have a full and busy life.” The American scoffed, “I am a Harvard MBA and could help you. You should spend more time fishing and with the proceeds, buy a bigger boat. With the proceeds from the bigger boat, you could buy several boats, eventually you would have a fleet of fishing boats. Instead of selling your catch to a middleman you would sell directly to the processor, eventually opening your own cannery. You would control the product, processing, and distribution. You would need to leave this small coastal fishing village and move to Mexico City, then LA and eventually New York City, where you will run your expanding enterprise.”
The Mexican fisherman asked, “But, how long will this all take?”
To which the American replied, “15 – 20 years.”
“But what then?” Asked the Mexican.
The American laughed and said, “That’s the best part. When the time is right you would announce an IPO and sell your company stock to the public and become very rich, you would make millions!”
“Millions – then what?”
The American said, “Then you would retire. Move to a small coastal fishing village where you would sleep late, fish a little, play with your kids, take siestas with your wife, stroll to the village in the evenings where you could sip wine and play your guitar with your amigos.”
Never gets old!! This is probably one of the best adages ever. I just wish this was imprinted on every wall, on every city! This needs to be talked about more.
It's an amusing story I've seen a few times, but I think it's disconnected from reality and strangely nobody ever discusses how
At his current margins, the fisherman's business is basically entirely fixed-cost. He needs to pay for a house and food for his family and new guitar strings when one breaks and that's it, in terms of expenses bait or whatever is probably next to negligible (I know nothing about fishing)
So he's vulnerable to someone spending twice as much time fishing as he does, lowering the commodity price of fish to 1/2 his current rate, so they'd be able to sell at 3/4ths his rate to undercut him while making a solid profit. Maybe the demand is there that it wouldn't affect our main character, but it's kind of an unstable equilibrium. If all his competitors decided that they actually wanted some of that profit and did full work days rather than only fishing for "a little while", the competition and increased supply would mean cheaper fish for everyone else in town but they'd end up stuck all working longer hours for not actually that much more money (since they'd have to compete with each other they probably couldn't all sustain 33% margins)
What the harvard MBA should have told the fisherman is that his lifestyle was at risk and he needs to form a cartel with all the other fishermen to not work more than a few hours a day (normally he would also have to worry about imports from elsewhere, but maybe transportation costs and a lax regulatory environment in the fisherman's town allow him to undercut external competitors without having to work too hard)
(One interpretation is that their culture is already forming that "cartel" as none of them want to or see a reason to work more. But they're still vulnerable to people from outside the villiage who don't share that view coming in and eating their lunch.)
I love this parable because it illustrates the implicit selfishness contained within the implicit anti-capitalism. The fisherman is content with his lot in life, and struggles little - but only he and his family are comfortable. The American, with his outrageous, complex plan is painted as a ridiculous figure; yet, his plan, if successful, would create countless opportunities for those who might otherwise struggle unreasonably to achieve the same level of comfort. It is self-sacrifice. Yet this mentality is painted as absurd, ridiculous, maybe even impossible.
except microdosing lsd is more like drinking coffee than smoking weed in terms of effects on your ability to do your job. He did it in hopes of enhancing his output
On the other hand the valuation of the company was 2 billion so he did increase their investment. It’s a two way street. They give you money, you deliver profit. I don’t agree that just because you are uncomfortable with someone you get to fire them because you entrusted him with money. I agree that it happens a lot. :D
An interesting point, but there's a difference between "valued at $2B" and "delivered a profit in a bank account". It takes a lot of trust to bridge that gap.
"Back in San Francisco, Zhu was preparing for an important meeting with a prominent investor group. Believing that limited quantities of LSD would improve his pitch, Zhu, who had never before used the drug, decided to try the microdosing plan. He took what he thought was a small amount of LSD shortly before the meeting."
I don't know if that the's whole story necessarily, but that and the "didn't stop talking to a reporter about internal matters after being directly asked to" is enough for me to discard the "The most likely reason Zhu was fired was anti-Asian bias" claim.
hilarious for us. dumb for him and his company. Small life lesson, try new risky things in ways that there is little downside. Want to drop some microdose of LSD? do it on a Saturday when you're doing your weeklies.
The board does not remove a CEO it is happy with for something this trivial, because it is too disruptive to the company. This was probably used as a pretext in a power struggle.
Yeh my thought too there's a lot of shady shit that goes on in the VC world.
I think he could have done with advice from a mentor who wasn't at all involved with the vc side - even on how formal meetings like board should be run.
He is right about different cultures around how meetings are run though.
- We love our CEO! We'll do anything to keep this boss happy
- We're stuck with a loser, and we need to make a change
- We're in the middle. This CEO has real strengths, which we appreciate, and real weaknesses, which concern us. We're regularly taking stock of the situation, and we'd probably like an orderly transition down the road. But we're probably okay for now.
The third situation is quite common. And in those cases, you don't really need a "pretext" or a "power struggle." You just need the board to say: "We've tolerated a lot, but maybe we've tolerated too much. This new incident is not what we'd be seeing if we had the right CEO."
True, but it's an incident he only informed the board (including new board members) about in late 2020, and is one aspect of his communication with Bloomberg Business that the board told him to stop for 10 months before being terminated.
Getting zonked on a class A drug during an important meeting with investors - so zonked you can't even read your own figures on a whiteboard - is no trivial matter.
Here, the narrative is that the CEO is ousted because of anti-Asian bias/racism from his investors. Similarly, with Basecamp, employees quit due to a change in workplace policy that they viewed as intolerant.
You can take those suppositions at face value. Or you can look at our supercharged political culture and view these prevailing narratives as convenient scapegoats.
I don't think that 1/3 of Basecamp's employees decided to quit based on one meeting or an isolated policy decision. I presume many were thinking about leaving (due to workplace culture or otherwise), and a 6 month severance package made the decision easy for them.
I have no idea what is going on internally at Iterable or the company's financial situation. But stellar performance gives you a lot of breathing room. Adam Neumann's drug use was tolerated and even encouraged when WeWork was doubling in value every year...right up until WeWork tried to go public and imploded.
Being unconventional is embraced in the business world as long as you're delivering returns to your investors. Once you're not, it is used against you. We've seen this fall from grace play out over and over again (Travis Kalanick, Steve Jobs, Jack Dorsey, etc).
In this case, even the author seems to begrudgingly be admitting that this clearly was not a case of racial/ethnic bias. Rather, the company was maturing and professionalizing and the CEO refused to get on board, and even went so far as to start airing out his own dirty laundry to reports. It would seem much of board support reduces down to confidence and trust. Zhu nuked both.
Externally the basecamp saga seems dramatic. I think the explanation is a lot simpler.
At the core though, they have a highly talented group of people that probably won't have trouble finding a job in 6 months. If I was in that situation, and I agreed with the changes they made (I read Jason Fried's post, and mostly agree), I would still take the buyout!
6 months salary for me, or most engineers (or anyone, really) is A LOT of money. I like my job, and I've had lifestyle jobs that I absolutely LOVED. I can't say that I have ever loved a job so much that I would turn down that much money to leave.
If I was staying I would be pretty annoyed, the people that leave get a bag of cash, and the people that stay get to pick up the slack while their former colleagues get on twitter to dump on the company?
I don't think anyone would have cared if it hadn't affected his job performance so obviously.
Just like no one cares (in the tech world at least) if you drink like a fish or get stoned every night if you show up the next day and get your job done.
While people are entitled to their view of the CEO, I find many of the comments doing nothing more than insulting the CEO.
As a South Asian, I think there's more meaningful discussion to be had on the "bamboo ceiling" and, in particular, how Chinese collectivist views interact in increasingly global economies. This core tension between the two views isn't going to go away. Perhaps the Eternal September is upon us?
What a useless answer.
I wanted his personal experience and understanding of the term. Wikipedia can’t tell me what it means to him and the experiences that informed His understanding.
This could go on all day.
Something like a glass ceiling often has a subjective experience behind its usage. A story, an anecdote.
When you ask somebody to go into more detail on something they have personal experience with, a with, a snide link to wikipedia detracts from the personal discussion and learning that could take place.
I read that article on wikipedia already, but I want to hear HIS story. Everyone is different, and there is something to learn from everyone.
ex•pound
intransitive verb To make a detailed statement.
intransitive verb To explain in detail; elucidate.
I worked as a CEO in SE Asia, and experienced the culture differences first hand. It's very real. It doesn't surprise me that there would be a "bamboo ceiling" in US companies because of the difference in styles.
The major one: in the West, the expectation is that everyone will express their opinion and be respected for it, even if their opinion is a minority. If you disagree with the boss, you're expected to say so, even to the point of having an actual argument. In the collectivist view, disagreeing (even privately) with those in authority is a huge no-no. Having an argument with your boss is roughly on a behavioural par with taking a dump on their desk.
It's easy to see how a collectivist boss would be criticised by Western colleagues for not allowing free debate or gathering enough opinions on a subject.
From the article, it seems the problem was that the CEO wasn't authoritarian enough, rather than the other way around. Looking to build consensus, rather than strongly setting direction. But I guess that's also just one piece of the puzzle too.
I believe the complexity is that because no-one can express disagreement, management there have to be very subtle about creating consensus first, because once a decision is public it can't be changed or disagreed with. I'm not sure, though - I struggled with this and didn't find a solution before I left.
I dont think its a good idea to publicly argue with your boss, even if its a western boss. I dont think they're made of different kind of flesh and psychology works roughly the same way everywhere.
It really depends on the boss, the context and what you mean by "public". Voicing a strong disagreement with your direct manager, while in a meeting with your company peers is usually great and builds credibility. So long as you're not concern trolling, a good boss will usually take what you're saying into account and open up the conversation to others to ensure everyone is on the same page. If the boss changes their mind based on the conversation, then you've proven your value and the boss has proven their ability to put the needs of the company over their ego. It's a win-win. If nothing changed, that's fine too, you said your piece, you learned the reasoning behind the decision that was made, and now you have to commit to follow through on the decision your team made. At Amazon, there was a value called "Disagree and Commit", which is pretty much exactly this. I was not used to thinking like that before I worked at AWS (which was many years back now), but I used value all the time to justify voicing concerns that I hadn't been confident enough to voice at previous jobs, and it ended up being really helpful to me professionally - and to the company as well.
The thing that really causes issues, is "airing dirty laundry". Ie, don't ever disagree around people outside of the company, don't complain to people above your manager or outside your org and don't gripe on company slack channels if it undermines your superiors.
> Zhu believes his preference to seek consensus instead of shutting down dissenting views or engaging in noisy debates is a cultural trait his investors mistook for weakness—a stereotype about East Asians that academics researchers have cited as a reason for their underrepresentation in leadership positions in the U.S.
Can we just stop for a sec and collectively roll our eyes at VCs (and our own) trope of a “tech leader”? We want some kind of decisive, basically tech bro, alpha to come in and boss people around without any context. We want the startup CEO to be a wunderkind, and magically know the right call to make at any given point. There’s little room for consensus based leadership, which has its own place. How often have you had the “hard charging leader” come in and make a mess because their confidence outstrips their know how?
I’m not saying one leadership style is better than the other, I just hope we recognize good consensus based leadership should be valued as well, and it’s rather undervalued in tech culture in favor of people that sometime make a lot of noise, but end up being completely full of it.
>” Zhu believes his preference to seek consensus instead of shutting down dissenting views or engaging in noisy debates is a cultural trait his investors mistook for weakness—a stereotype about East Asians...”
I could be wrong but on the surface it looks like he’s looking for an excuse to blame something else.
That stereotype was for Japanese who stereotypically seek consensus (but it’s more an expectation that you will agree with the boss rather than achieving managerial nirvana). In any case I have not seen that as a stereotype for Chinese or Taiwanese or any of the Chinese diaspora enclaves in Southeast Asia so it almost seems like someone wanting to take advantage of other people’s uncertainty of a stereotype where it’s kinda plausible.
> I’m not saying one leadership style is better than the other, I just hope we recognize good consensus based leadership should be valued as well, and it’s rather undervalued in tech culture in favor of people that sometime make a lot of noise, but end up being completely full of it.
It seems likely that some leadership styles are better than others and plausible that techbrocracy is better than a more circumspect style for companies like this.
Variety of styles at various similar firms might have benefits, but I don't think it's fair to assume that variety is worth while without an actual argument or evidence.
> techbrocracy is better than a more circumspect style for companies like this.
I haven't seen solid evidence that that is the case.
Here's an alternate hypothesis: high-capital investors & wall street types aren't actually that good at determining quality management at all, they grew up in affluent social circles where "professional bro"-esque (be it finance or tech) people were common and respected, and they project those views onto the companies they invest in. Getting investment capital from these people is as much about cultural homogeneity with the "old money" types as it is about having a brilliant idea or a good execution plan.
It's worth remembering that most of this capital is being invested by people who just inherited the wealth from their parents, they're not necessarily genius market participants.
You would also need a source for most of the capital being sourced from inheritance. It sounds like unsupported assertion especially when you look at the landscape of the richest tech people. Gates, Jobs, Bezos, Zuckerberg, Musk all have built the capital themselves even if they had a nice start in life.
Seeing how much more wealth there is now than there was 40-60 years ago it just doesn't seem plausible that most of the investors just inherited it. Extraordinary claims - extraordinary evidence please.
Sure, the estimates range from 50% to 65% of all private wealth in the US being inherited by the 5% most affluent households [0]. This logically implies most of the wealth held by affluent households is inherited.
Certainly, those at the very, very top (ie. the literal top 10, like Gates, Bezos, Musk) of households are likely to have built their own capital, but I'd also point out that there are plenty on the top list that have inherited it, if you look at the top 15 wealthiest Americans, 5 of those arguably did not earn their wealth (the Waltons, MacKenzie Scott, and Charles Koch). [1]
I don't think it's fair to say that MacKenzie Scott or the Waltons didn't earn their wealth. I mean I am on conservative side economically but the case of MacKenzie Scott seems like a classic "we form a team, split tasks and try to do as well for ourselves as we can" kind of deal. Exactly the way marriages should be. If a family runs a business and a lot of family members are involved one way or another it's not fair to say the wealth is inherited. Nor is it fair to say a wife who supported her husband in both everyday and business matters didn't earn her wealth.
As to sources: what politically motivated newspaper claims in an opinion piece isn't meaningful. I look at the list of richest Americans and I see the vast majority (90%+) or even all of them were involved in building the fortune.
When googling around for numbers it seems most sources claim that vast majority of world population millionaires are self made and even bigger percentage of billionaires are.
Personally all the people I know who did well for themselves didn't inherit anything. I am sure my perspective is shaped by being born in a very poor communist country but it seems the actual numbers worldwide don't contradict my intuition that fortunes bigger and smaller are mainly built and rarely inherited.
> I don't think it's fair to say ... the Waltons didn't earn their wealth.
Look, I'll grant you that Scott is "arguable" as I said, Koch is also very arguable.
I don't think you can seriously claim the Walton heirs earned their wealth, but I don't think it is particularly relevant to the debate.
> what politically motivated newspaper claims in an opinion piece isn't meaningful
I only cited the WaPo because it collated the econometrics papers that showed the claim. Look, you choose whether you want to believe, whether it is peer-reviewed economics research and meta-analysis or "googling around for numbers." We all know how reliable Google is :)
> it seems most sources claim that vast majority of world population millionaires are self made
I also googled this "claim", and huh, guess what showed up? A bunch of "politically motivated newspaper claims" but this time they were relying on this obviously biased source (https://www.wealthx.com/report/world-ultra-wealth-report-201...), not peer-reviewed economics research.
Ultimately, you choose what to believe but almost all the evidence points to the majority or close to the majority of private wealth being inherited by the wealthy.
> Personally all the people I know who did well for themselves didn't inherit anything
1. This is 100% contextual to America
2. Many people are very shy about admitting an inheritance.
I also don't really trust you to be a good judge of if someone is "self-made" if you honestly think the Walton's didn't inherit their wealth - pretty much every one of them is described as an heir/heiress and they were not actively that involved in the business.
You choose what to believe, but ultimately "facts don't care about your feelings." You seem to be reasoning backwards from your political beliefs to the conclusions you want to hear.
> plausible that techbrocracy is better than a more circumspect style for companies like this.
Given that the company was founded and formed under Zhu's leadership, it was probably exactly suited to his leadership style[0].
The new factor appears to be the VC's. It's not so common now, but VC's used to have a reputation for replacing founders with "experienced" CEOs - y'know: their mates from the golf club who could be counted on to play ball nicely. This was especially common if the founder was unconventional in any way.
[0] TFA doesn't mention any internal management problems, so I'm assuming all was well and there wasn't any dissatisfaction with the leadership style. That assumption could be wrong.
> y'know: their mates from the golf club who could be counted on to play ball nicely. This was especially common if the founder was unconventional in any way.
And it's a pretty obvious conclusion from:
1. the fact that GPs have to put up $10s of millions into the fund to get the job
2. most (>50%) wealth held by affluent people (like the people who become GPs) is inherited from their parents.
These are people who grew up in affluent social circles and want people like them managing the companies they invest in.
> We want some kind of decisive, basically tech bro, alpha to come in and boss people around without any context
Who exactly wants this? Neither Tim Cook, Sundar Pichai nor Zuckerberg fit this description. The vast majority of tech leaders seem like consensus builders, as opposed to this "alpha leader" trope.
Theranos investors? Given how taken they were by Holmes's affected deep voice and piled money in without so much as asking some biology professors about the limits of small blood samples.
The fact that even the most assertive tech leaders are more "chair throwing tantrum incident" at most may be part of their aggro. "Normal people" get irrationally pissed off at things not meeting their prejudices and preconceptions. In this case the lack of "alpha bro" at the top. They cannot imagine a lack of this as seen in the shibboleth of the clueless "techbro" perojative.
You don't see vandalism for decades saying "Wall street go home!" in the Bronx in the face of gentrification even though the rough consensus is that Wall Street is a bunch of priveledged douchebags.
Hard to get a grip on exactly what proportion of tech leaders are consensus builders versus alpha tech bros, but there is a trope of the highly opinionated leaders who rules tyrant-like, for example Steve Jobs, Jeff Bezos, Bill Gates, Steve Ballmer.
Gates was famously the office bully. He dressed down employees in public, hurled sarcasm at rivals, and would reportedly troll around Microsoft's parking lots on weekends to see which employees were working overtime.
Big companies that have reached sustainability require consensus. Startups are basically moon-shots based on hopefully achieving product/market fit. For that (as a VC managing a portfolio) you need a CEO who's willing to stay the course. More: https://www.ribbonfarm.com/2017/11/09/ceos-dont-steer/
Yeah the golden combo is hard charging leader who takes their first 90 days to ID what to be hard charging about. High EQ and being more often than not the last (or at least the third) person to offer an opinion is the mark of a mature leader.
Otherwise it’s just a bull in a china shop stepping on and sh*ting on a lot of pre-existing work and stakeholders who did the work. Easy way to lose an org trust and never get it back unless a ton of headcount churn occurs such that no one really recalls how much of a moron the lead was.
What percentage of founders get replaced as CEO? It is very common for VC's to want what is often called, "adult supervision" once a company reaches a certain size. Even Google (home of the archetypal tech bro founder Sergey Brinn) ended up hiring Eric Schmidt once they got to a certain size.
I'm sure there is anti-asian sentiment (or at least discomfort) out there, but replacing a CEO once a company gets big enough to need it is absolutely routine.
The allegations of racial bias and the "bamboo ceiling" are entirely unsupported by this article.
The two investors with whom Zhu seems to take issue were born and raised in South Asia and Turkey, respectively.
Zhu was replaced by his co-founder (who supported Zhu's firing) who is of East Asian descent.
Zhu believed "the company were too focused on sales and money at the expense of altruistic goals". Excuse me? You're running a company with other peoples' money at stake with the express understanding that you will seek to maximize their returns.
Zhu was the one who publicized the LSD incident (which was NOT a microdose, as he admits) via his contact with a reporter. The board actually tried to intervene. Imagine finding this out as an investor. Now all your company's current and potential customers, partners, and investors know that you've got an Adam Neuman type at the helm. That's got major potential to harm investors.
Ultimately, this reads as an egoist who can't sufficiently control his impulses. It's a wonder he wasn't fired sooner.
Separately, much of the reporting on this has been emblematic of the sorry state of journalism. This article, for example, bends over backwards to draw tenuous connections between racial bias/identity politics and Zhu's firing. Truly shameful.
It is a very narrow view to conclude racial bias did not exist by naming specific minority ethnicities.
I have struggled with this question a lot and taking a bigger picture view helped me understand the systemic problem.
The exact same reasoning was used by some social media users to argue that there was no racial motivation in the case of George Floyd's murder by Minneapolis police in May 2020. One of the officer was East Asian and another was not white but the man who had the knee on the neck of George Floyd was white and was the superior officer.
I can't conclude that all the power over Mr.Zhu in this case was in the hands of the two VCs you mentioned.
Absolutely. Which is why. GP's comment about there being (or not being) a bamboo ceiling is wrong, or more charitably, has faults due to the underlying dataset used.
Perhaps my phrasing was not sufficiently clear. I make no a claim that this case falsifies the "bamboo ceiling hypothesis". Rather, it seems like there is quite a bit of evidence in this case that the reasons for Zhu's firing were unrelated to race/ethnicity/culture. To my knowledge, for instance, highly informal professional attire/attitude and use of hallucinogens are not staples of Chinese culture or tradition.
>The two investors with whom Zhu seems to take issue were born and raised in South Asia and Turkey, respectively.
You can't simply abstract all of Asia, from Turkey to China, as a singular monolith. Now's a good chance to point out that the MIT 'Bamboo Ceiling' paper from 2020 makes this distinction in the title:
"Why East Asians but not South Asians are underrepresented in leadership positions in the United States"
I don't think he did abstract it that way; it's one point in a more holistic picture of Zhu's firing, which largely speaks against Zhu's own assertion that [investors such as Shah and Bicer] would be more comfortable with a white CEO:
"You’re just pattern matching,” Zhu recalls telling them. “Your last 20 CEOs who went public, they were probably all Caucasian guys.”
Note again that the same board replaced Zhu with his east-Asian partner, who also supported Zhu's ouster, and that each of the investors in question had funded other major start-ups with east-Asian CEOs.
> Zhu believed "the company were too focused on sales and money at the expense of altruistic goals". Excuse me? You're running a company with other peoples' money at stake with the express understanding that you will seek to maximize their returns.
A guy has a cool idea, then he needs money to make it big. Some people give the money in the hope that they will maximize their return. The fact they give money doesn't give them total power.
I've been in that situation of having a cool idea with investor interested. Believe me, those with the money quickly think your idea is theirs and all of a sudden you're reduced to that : an initial idea, a starting point. As soon as money is put in, you basically don't exist anymore. I don't consider that a fair deal; it's a deal with vultures.
If you don't want to be beholden to other people, don't take their money with the promise that you are going to dedicate yourself to increasing their investment.
If it's a business with a clear social mission (fighting poverty; helping the environment, etc.) I'm super-sympathetic to the challenges of being an altruistic founder in a money-obsessed world.
But Iterable's mission (quoting from its career page) is: "We empower growth marketers." Its products help your organization get more juice out of emails, texts, etc.
That's a busine$$ -- and it's very much an area where money can be made. I'm struggling to see how this could be an altruism play, too.
I wonder why in this case it's different, yet another tech CEO/Founder can go to Burning Man, trip on LSD and peyote, brag to everyone they were out of their mind at Burning Man, and face no consequences.
I feel the LSD wasn't the main problem. Zhu just didn't manage the company in a manor they felt comfortable with and used any pretext to cast him out.
> another tech CEO/Founder can go to Burning Man, trip on LSD and peyote, brag to everyone they were out of their mind at Burning Man, and face no consequences
To which CEO are you referring? Also, the comparative context is very different. One (Zhu) is in a fundraising meeting with a potential investor (i.e. in professional capacity) whereas the other (your hypothetical) is at a festival (i.e. a personal capacity).
> I feel the LSD wasn't the main problem. Zhu just didn't manage the company in a manor they felt comfortable with and used any pretext to cast him out.
I agree. The article seems to suggest that the LSD incident was merely emblematic of a trend of behavior with which the board was unsatisfied. In fact, reading between the lines, it actually seems like the board was more troubled that Zhu chose to publicize the LSD incidence via a reporter.
His mistake wasn’t in taking the wrong amount of LSD. His mistake was testing it for the first time in an important meeting. But it seems this is a common type of mistake for him: taking unnecessary risks for himself rather than necessary risks for his company.
This wasnt his first mistake, this was the one that finally pushed things past acceptable comfort for other decision makers. Founder/ceo of a startup is high risk, high reward and he lost on his gamble. It happens all the time. The company will continue without him.
If that's the case, I haven't seen it. Equity can come with clawback criteria, but that usually has a defined duration, which has certainly expired because the company was founded 8 years ago.
Companies can't just kick someone off the cap table once they have vested equity.
First, we don’t know the specifics of that original agreement. Further, they can change the pricing to dramatically reduce the value. I personally know someone who effectively lost control of their company and with it any real equity in a company that’s now very very large, and I’ve seen it be attempted with another friend as well.
There’s no shortage of stories out there of founders being burned by VCs once the company has real money behind it.
Except they can treat current employees differently. It doesn’t have to be a down round. In the case I’m thinking of, valuation went up a lot… it was the opposite of a down round. And it was all engineered to screw all the previous people as it was taken over by an entirely new crew as a lead investor directed.
It is hard to speculate on what happened without more details. There are a lot of ways founders and employees can bee screwed, especially shenanigans with options, but as I said above, Im not aware of any of anyway to destroy fully granted/vested stock.
Reporting like this infuriates me - it's nothing more than gossip when presented this way:
"He wore cargo shorts and a T-shirt to a meeting with Geodesic, a VC firm founded by John Roos, a former U.S. ambassador to Japan. An Iterable board member later informed him Geodesic wouldn’t invest, implying it was partly because of his casual attire. A person familiar with the firm’s thinking says Zhu’s attire didn’t factor into the firm’s decision"
So was it the shorts or was it not the shorts? If the reporter has a solid source saying it wasn't the shorts, then why bring it up at all, unless the gossip aspect of it fits your narrative...
The anecdote is there to establish a pattern of sloppiness and carelessness and unnecessary risk-taking. Regardless of whether it, ex post, affected Geodesic's decision, it clearly could have affected it ex ante, and he should not have taken such a completely unnecessary risk, which helps establish his unfitness and why the LSD was the final straw/excuse.
I think it's good that the reporter is showing multiple viewpoints. Rarely is there one canonical view in situations like this. The implications here are that the Iterable board member had a personal discussion with a decision maker at Geodesic, and got the hint that they felt Zhu was disrespectful, which the board member attributed to the attire. The person familiar with Geodesic's thinking could be echoing the official line at Geodesic, as they know they are speaking with a reporter. The reporter shows both sides and stays neutral, letting us make up our minds ourselves.
Rather, his mistake was not retaining control of the company he founded, either by bootstrapping it entirely or not taking venture capital. Contrast this to the recent Basecamp debacle, both cofounders owned 100% of the company and could do as they pleased, no one could fire them.
I see this as very misguided. Companies do not exist for the pleasure of the founders, they exist to serve a need that is greater than the founders. If a founder (or any executive for that matter) is threatening the well-being of the company, having board oversight is a benefit. Thus, retaining 100% control of a board is not always in your company's best interests, and can be a big liability. You want more accountability, not less. To that degree, even if the company does not take venture capital, you as the CEO might still want people on your board that can be good advisors and hold you accountable. The board is the CEO's boss, and just like with any boss, behavior has consequences.
> Companies do not exist for the pleasure of the founders
I disagree with this notion, even as you might agree. If I'm making a company, it exists for my sole pleasure. If it didn't, then I wouldn't have bothered creating the company in the first place.
> The board is the CEO's boss, and just like with any boss, behavior has consequences.
I would make a company to get away from having a boss at all, not so that a board could now be my new boss.
> His co-founder, Andrew Boni, and the company’s entire board told him he was losing his job, primarily because he had taken LSD before a meeting in 2019.
From the article, looks like that wasn't the actual reason. The actual reason is that Zhu preferred his own personal brand PR (with heavy social justice activism overtones, accusing anybody who challenges him of racism because he happens to be of Asian descent) to the good of the company, and was unwilling to reconcile the two.
In my experience moving the engineering-minded founder(s) to some other role like CTO and getting a more experienced "business school" type CEO is very common at some stage of a startup's life.
If he was refusing to make this change then it probably was just a bog-standard power struggle.
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[ 4.1 ms ] story [ 260 ms ] threadAnyone have juicy insider info?
“But your replacement is Asian..”
“Oh he’s temporary, they’ll fire him too”
Edit: Since someone seemed to be irritated with my comment enough to downvote, people just with East Asian names have been known to suddenly face less discrimination once they started using non-East Asian names, or be characterized as non-East Asian after changing their names to something non-Asian.
Some notable biracial (White/East Asian) Hollywood actresses with ambiguous racial characteristics have had to change their East Asian sounding name to a white name to get roles, or non-typecast roles. For example Sandrine Ho (of House of Cards) changed her name to Sandrine Holt and suddenly got more callbacks.
I've done similarly and taken similar risks - and I'm lucky enough that the combination of my prior experiences with the stuff and luck in the moment helped see me through my troubles.
But if it hadn't, it would've been painfully obvious I'd shot myself in the foot and would need to confront the choices that led me to being able to make such a stupid one.
"He wore cargo shorts and a T-shirt to a meeting with Geodesic, a VC firm founded by John Roos, a former U.S. ambassador to Japan. An Iterable board member later informed him Geodesic wouldn’t invest, implying it was partly because of his casual attire."
Seems petty. Surely VC firms have had to look past appearances before. Of course, it did say "partly"...other things could have transpired in the meeting.
And another source in the article claims that had nothing to do with it; so who knows.
He did the famous Sequoia pitch in pajamas:
https://www.businessinsider.com/mark-zuckerbergs-brutal-pran...
Stuart Ellman the VC talking about Mark Zuckerbergs arrogance and why they skipped investing in Facebook:
https://www.businessinsider.com/15-people-missing-out-on-mil...
The employee who rejected J. K. Rowling's Sorcerer's stone manuscript for being too long didn't try to say it was her fault for making it too long and that is why the company missed out on the first billion dollar author.
If you have to pull millions of dollars out of your own pocket to invest into a company led by someone that doesn't care enough to dress at least business casual... I can understand thinking twice about that.
Maybe the pitch wasn't even that convincing, the cargo pants were just the cherry on top.
Given the stats on VC investments in firms led by women, I'm not sure this is a true statement.
However, dressing appropriately for a meeting is an easy way to demonstrate that the person is taking the situation seriously and being respectful of the other parties. If someone can’t make the effort to dress appropriately for pivotal VC meetings that decide the future of their company, it’s likely they won’t bother taking other meetings seriously either: Meetings with customers, partners, recruits, and so on.
As a VC, you don’t want to fund someone who will go around being disrespectful, intentionally or otherwise, thought your network. We like to glorify the exceptions like Steve Jobs, but the reality is that dressing appropriately to show respect for your business partners is a fact of life.
In 2021, it’s cheap to dress in a presentable manner. You don’t need a suit and tie (west coast, anyway) but you do need to make a basic effort.
I don't think dress has anything to do with this firing.
Pretty sage advice. I'm keeping this one.
When Bill Gates and Paul Allen were preparing for their life changing meeting with IBM, they knew that IBM has very strict dress code, so they dressed in conservative IBM style suits. At the same time IBM executives wanted to make these young unknown west coast guys comfortable and decided to wear relaxed and informal attire breaking their own dress code.
When the two groups met, they busted into laughing. It was funny but also made it clear that both were serious and wanted the deal succeed.
A really talented CEO might be good enough to overcome "quirkiness" on the "dress-the-part" side, but you have to have sufficient other advantages.
A really talented CEO isn't overcoming this. They're not overcoming anything; they're using it.
people who run the core routers of the largest ISPs on the planet regularly show up to meetings in cargo shorts and t-shirts, believe it or not. They're responsible for things much more critical than some overly-valued advertising/consumer promotions marketing firm.
Taking a "small amount" LSD for the first time in your life, right before an important meeting, in the vain hope that it will improve your pitch, when you don't even have any idea how it will feel, or what it will do to you, or how long it will last, or even how to medically define and accurately measure a "small amount" of LSD, is astoundingly idiotic and irresponsible.
Is that how he runs his whole company? Why bother with development and staging servers? Just log in as root and hack away on the production server!
I understand that he made a dosing mistake, but to pile on this whole thread, what he did was a forehead-smackingly bad decision.
I would love to work for someone like this, but since I just retired, not really a thing any more.
I wouldn’t assume this, or that they’re worth the same.
If dosed correctly (it takes time to find it and depends on the person) micro-dosing (usually around 5 - 20 ug per dose) an obvious effect in not as apparent as you might expect.
For me, 5 to 10 is enough. I don‘t actually want to feel the body high when microdosing. Precisely because it should feel like a normal day. Except your perception, creativity and emotional balance is heightened.
Is there any science to back this up? The increase in confidence from alcohol makes me dance better... from my perspective, at least. I've read the "productivity boost" from ADHD drugs is similar. It feels like you're doing more/better but you're really doing the same.
[0] https://www.gwern.net/LSD-microdosing
That is exactly the problem. They cargo cult Steve Jobs' personality, fashion or some other aspect, but they don't deliver Steve Jobs kind of results. It ends up being cringey at best and disastrous for their company at worst.
I have seen this before with CxOs and owners who decided their company would be "just like Apple" and they would be "just like Steve Jobs". They read how Steve Jobs was an asshole, so they just started acting like assholes towards everyone waiting for the fame and fortune to follow.
1) Steve Jobs had a vision for the appearance, function, and marketability of his products, and enforced his tyrannical will on his team until that vision was met, or at least it was impossible to enforce any more. The fact that his vision changed along the way or that he was inconsistent at times isn't as important as the fact that he was a central authority that was allowed to keep the resultant products consistent and stable. People who try to behave like Steve Jobs rarely have the level of vision that he did, and mimic his behavior rather than his principles.
2) Everything the teams under Steve Jobs produced has been cargo-cult mimicked ad nauseam by people today, to the point where every modern software looks like someone tried to redesign Apple software from memory. Unfortunately, it all sucks (compare Jira to Windows 95 Email in terms of form and its relation to function).
In this case, the vision is unifying and improves your ability to execute.
If the vision is not coherent or consistent then you lose the ability to execute without micro-management. Staff will be unhappy because they feel subject to the whims of an unpredictable dictator.
You can have both experiences in the same company if there are some people who "get it" and other people who don't.
https://en.wikipedia.org/wiki/Bill_Nguyen
https://en.wikipedia.org/wiki/Color_Labs
https://collapsed.co/startups/color-labs
https://www.fastcompany.com/1784823/bill-nguyen-the-boy-in-t...
https://www.fastcompany.com/1742613/how-colors-bill-nguyen-w...
Seems like he picked a bad time to try it out.
https://www.mondo2000.com/2018/06/18/the-inspiration-for-hyp...
>The Psychedelic Inspiration For Hypercard, by Bill Atkinson.
>In 1985 I swallowed a tiny fleck of gelatin containing a medium dose of LSD, and I spent most of the night sitting on a concrete park bench outside my home in Los Gatos, California.
>I gazed up at a hundred billion galaxies each with a hundred billion stars, and each star a giant thermonuclear fusion reaction as powerful as our Sun. And for the first time in my life I knew deep down inside that we are not alone.
>I knew that life on planet Earth is not the only pocket of consciousness in the universe, and likely not the most advanced. But we still have a role to play in the unfolding drama of creation.
>It seemed to me the universe is in a process of coming alive. Consciousness is blossoming and propagating to colonize the universe, and life on Earth is one of many bright spots in the cosmic birth of consciousness.
>But the stars are separated by enormous distances of darkness and vacuum, which may hinder communication between them. I lowered my gaze and saw the street lamps below glowing brightly, each casting a pool of light but surrounded by darkness before the next lamp. As above, so below.
>The street lamps reminded me of bodies of knowledge, gems of discovery and understanding, but separated from each other by distance and different languages. Poets, artists, musicians, physicists, chemists, biologists, mathmeticians, and economists all have separate pools of knowledge, but are hindered from sharing and finding the deeper connections.
>My vision distorted by thick eyeglasses, I witnessed the curvature of the Earth’s horizon, and I felt the pull of gravity toward its center, such that every one of us is standing at the very apex. Each of us stands at the top of planet Earth, and each of us is a leader or captain of the “Blue Marble” team.
>How could I help? By focusing on the weak link. If I were captain of a soccer team, I would look for the weak link and work on it. If the goalie was letting too many through, I would spend extra practice time with him, and the whole team would prosper.
>It occurred to me the weak link for the Blue Marble team is wisdom. Humanity has achieved sufficient technological power to change the course of life and the entire global ecosystem, but we seem to lack the perspective to choose wisely between alternative futures. But I was young, without much life experience or wisdom myself.
>Knowledge, it seemed to me, consists of the “How” connections between pieces of information, the cause and effect relationships. How does this action bring about that result. Science is a systematic attempt to discover the “How” connections.
>Wisdom, it seemed to me, was a step further removed, the bigger perspective of the “Why” connections between pieces of knowledge. Why, for reasons ethical and aesthetic, should we choose one future over another?
>I thought if we could encourage sharing of ideas between different areas of knowledge, perhaps more of the bigger picture would emerge, and eventually more wisdom might develop. Sort of a trickle-up theory of information leading to knowledge leading to wisdom.
>This was the underlying inspiration for HyperCard, a multimedia authoring environment that empowered non-programmers to share ideas using new interactive media called HyperCard stacks.
>Each card in a HyperCard stack included graphics, text, interactive buttons, and links that took you to another card or stack. Built-in painting tools, drag-and-drop authoring with a library of pre-fab buttons and fields, and simple event based scripting made HyperCard flexible and easy to use.
>It took a lot of hard work and a dedicated team to ...
Fails to recognize the repeated failure in such behavior. Gets fired.
Plays race card.
<sarcasm>
No, it couldn't be about anything else but his race...
No need to take personal accountability for one's actions (despite warnings)--
it's everyone else's fault for being racist!
</sarcasm>
This is why I refuse to live in West Coast cities. Too much SJW kool aid.
edit
ouch, those downvotes hurt so badly!
why can't I just be a brainless sycophant like the big corporations & global governance organizations want me to be?!
:( dastardly critical analysis! You've stung me again!
Why can't I just take the force fed propaganda that I encounter at every turn across entertainment & "news" media!
Oh brain, why do you fail me?!
Good luck with your job search btw ;)
What's your take on the article & story btw?
But microdosing -- and getting the dose wrong! -- puts him in a whole different category. That's just a fundamental inability to act sensibly in risky situations. The board doesn't need to wait for the second example.
This is the kind of incident that plays well in the press, because it generates headlines - like becoming the first word of a headline.
Do we really think that the board was so gosh-darn offended that their founder did the wrong LSD dose, once? Or, that there were long-standing disagreements over strategy, direction, and tone?
The latter is harder to justify in the normie press, so they're trying to crucify him over some minor incident.
With how long trips and the comeup take, I just have trouble understanding what kind of confidence it must take to walk in the meeting anyways and try to wing it. I would have found any excuse to sober up and get things in order before drunkely stumbling through a big pitch.
And mixing up the dosage is insanely easy with LSD, especially if you are using tabs since the LSD isn't evenly distributed throughout the paper. Also, you never really know how much LSD is on your sheet or in your vial, you just have to trust your source.
My point was that seeing visuals on a screen doesn't necessarily mean it's a large dose, especially for a first time user. Definitely not a microdose, but getting the dosage right is an art.
Did he kill someone? No. Did he lose a major customer account? No. Did he fire a top employee in a drunken rage? No.
He's under a lot of pressure and fucked up in an embarrassing way once. That doesn't mean he has a substance problem. It means he had a bad day.
If it happens a second time? Yeah, ok, now it's starting to be a track record. Third? Nuke him.
It's ok for people to fuck up sometimes
You'd probably be in trouble.
And if on top if that you would be freely talking to the press about various issues even after the board has asked you to stop it.
You'd be fired. Which is exactly what happened here.
If your company is big enough to think going public, "Let's try LSD just before a big meeting" is not exactly the kind of idea you want your CEO to have.
My 2¢: stop forcing companies to provide health insurance.
Another thought is throughput. If welfare wasn't so closely tied to employment, working relationships could then be more ephemeral until one found a best fit. This may also look like more cautious hiring, which directly leads to missed opportunities for all parties.
Edit:
Capital buys employees, but it also buys time. For every extra dollar an employee costs the amount of time it takes to make the decision to hire that employee also increases. An efficient job market would compensate based on contribution, which is a lot more possible if a significant amount wasn't mandated to be spent, and then guilted into continue spending because, you know, you don't want to take away someone's welfare.
A proposal to do exactly that. Critically, it phased out incentives available to corporations that provide employee healthcare in favor of tax deductions for individuals that purchase their own healthcare. During the transition period, employers would subsidize private plans purchased by their employees.
The idea of capitalism is that capital accumulates in the hands of those who figure out how best to deploy and protect it. Investors, not Zhu, are the ones with the track record and experience.
Trusting them to be stewards of capital is a better bet than trusting an eccentric, unproven founder who decides to experiment with LSD for the very first time before a big pitch.
If Zhu had managed a successful exit, he would have established that track record, accumulated some capital of his own and bought himself the leeway to be as eccentric as he wishes in the future. See: Elon Musk.
At the extreme, if starting a company only requires pocket change, then nobody (society, investors, or anyone else) has much to lose in letting an unproven founder do their thing.
In what ways could capital be made less necessary?
By reducing the cost of anything and everything that startups spend money on.
(And for the largest item in many budgets, namely employee costs... in the presence of an adequate social safety net, cash-strapped startups could pay employees in equity rather than cash, and they could stick around for as long as they thought it might be worth something in the end).
Somewhat separately, what struck me from the article is that Zhu's controversial moves generally didn't involve bad business decisions, but rather failing to impress investors at a moment when the company needed the money. It would be better if that need for money were reduced, and we could all see how this type of experimental style turns out.
Did he really not have _any_ sense of a proper dose? Seems unlikely.
I will say that hiring people who are risk averse is great for middle managers who will say NO to most opportunities because they're more afraid of failure than they are interested in opportunity.
Hire risk takers and you get risk takers.
1. Unlike income, there is little relationship between capital and most measures of intelligence.
2. Most private capital in America is inherited.
But we already know it does. He brought the company from 0 to $2b valuation, steadily growing for 8 years.
I do agree though that it would be great for startup to not depend on VCs that much.
I prefer to smoke weed and hang at the beach, so I don't chase investor money, or make myself responsible for the wellbeing of full-time employees.
Is it limiting, absolutely.
Would I rather work myself to death now so I can... one day (maybe, dad died at 50 so...) one day maybe do the same thing... Lol
An American investment banker was at the pier of a small coastal Mexican village when a small boat with just one fisherman docked. Inside the small boat were several large yellowfin tuna. The American complimented the Mexican on the quality of his fish and asked how long it took to catch them.
The Mexican replied, “only a little while. The American then asked why didn’t he stay out longer and catch more fish? The Mexican said he had enough to support his family’s immediate needs. The American then asked, “but what do you do with the rest of your time?”
The Mexican fisherman said, “I sleep late, fish a little, play with my children, take siestas with my wife, Maria, stroll into the village each evening where I sip wine, and play guitar with my amigos. I have a full and busy life.” The American scoffed, “I am a Harvard MBA and could help you. You should spend more time fishing and with the proceeds, buy a bigger boat. With the proceeds from the bigger boat, you could buy several boats, eventually you would have a fleet of fishing boats. Instead of selling your catch to a middleman you would sell directly to the processor, eventually opening your own cannery. You would control the product, processing, and distribution. You would need to leave this small coastal fishing village and move to Mexico City, then LA and eventually New York City, where you will run your expanding enterprise.”
The Mexican fisherman asked, “But, how long will this all take?”
To which the American replied, “15 – 20 years.”
“But what then?” Asked the Mexican.
The American laughed and said, “That’s the best part. When the time is right you would announce an IPO and sell your company stock to the public and become very rich, you would make millions!”
“Millions – then what?”
The American said, “Then you would retire. Move to a small coastal fishing village where you would sleep late, fish a little, play with your kids, take siestas with your wife, stroll to the village in the evenings where you could sip wine and play your guitar with your amigos.”
At his current margins, the fisherman's business is basically entirely fixed-cost. He needs to pay for a house and food for his family and new guitar strings when one breaks and that's it, in terms of expenses bait or whatever is probably next to negligible (I know nothing about fishing)
So he's vulnerable to someone spending twice as much time fishing as he does, lowering the commodity price of fish to 1/2 his current rate, so they'd be able to sell at 3/4ths his rate to undercut him while making a solid profit. Maybe the demand is there that it wouldn't affect our main character, but it's kind of an unstable equilibrium. If all his competitors decided that they actually wanted some of that profit and did full work days rather than only fishing for "a little while", the competition and increased supply would mean cheaper fish for everyone else in town but they'd end up stuck all working longer hours for not actually that much more money (since they'd have to compete with each other they probably couldn't all sustain 33% margins)
What the harvard MBA should have told the fisherman is that his lifestyle was at risk and he needs to form a cartel with all the other fishermen to not work more than a few hours a day (normally he would also have to worry about imports from elsewhere, but maybe transportation costs and a lax regulatory environment in the fisherman's town allow him to undercut external competitors without having to work too hard)
(One interpretation is that their culture is already forming that "cartel" as none of them want to or see a reason to work more. But they're still vulnerable to people from outside the villiage who don't share that view coming in and eating their lunch.)
"Back in San Francisco, Zhu was preparing for an important meeting with a prominent investor group. Believing that limited quantities of LSD would improve his pitch, Zhu, who had never before used the drug, decided to try the microdosing plan. He took what he thought was a small amount of LSD shortly before the meeting."
That's just plain stupid.
also it sounds like a litany of other things but I read this yesterday and don't recall off hand now
I think he could have done with advice from a mentor who wasn't at all involved with the vc side - even on how formal meetings like board should be run.
He is right about different cultures around how meetings are run though.
- We love our CEO! We'll do anything to keep this boss happy
- We're stuck with a loser, and we need to make a change
- We're in the middle. This CEO has real strengths, which we appreciate, and real weaknesses, which concern us. We're regularly taking stock of the situation, and we'd probably like an orderly transition down the road. But we're probably okay for now.
The third situation is quite common. And in those cases, you don't really need a "pretext" or a "power struggle." You just need the board to say: "We've tolerated a lot, but maybe we've tolerated too much. This new incident is not what we'd be seeing if we had the right CEO."
The article has a specific quote which would indicate there's some disconnect between the average board and this ceo.
>> He believed that he and the company were too focused on sales and money at the expense of altruistic goals
This is an obvious point of conflict with a board, which would not align itself with a CEO who said that even privately.
Here, the narrative is that the CEO is ousted because of anti-Asian bias/racism from his investors. Similarly, with Basecamp, employees quit due to a change in workplace policy that they viewed as intolerant.
You can take those suppositions at face value. Or you can look at our supercharged political culture and view these prevailing narratives as convenient scapegoats.
I don't think that 1/3 of Basecamp's employees decided to quit based on one meeting or an isolated policy decision. I presume many were thinking about leaving (due to workplace culture or otherwise), and a 6 month severance package made the decision easy for them.
I have no idea what is going on internally at Iterable or the company's financial situation. But stellar performance gives you a lot of breathing room. Adam Neumann's drug use was tolerated and even encouraged when WeWork was doubling in value every year...right up until WeWork tried to go public and imploded.
Being unconventional is embraced in the business world as long as you're delivering returns to your investors. Once you're not, it is used against you. We've seen this fall from grace play out over and over again (Travis Kalanick, Steve Jobs, Jack Dorsey, etc).
At the core though, they have a highly talented group of people that probably won't have trouble finding a job in 6 months. If I was in that situation, and I agreed with the changes they made (I read Jason Fried's post, and mostly agree), I would still take the buyout!
6 months salary for me, or most engineers (or anyone, really) is A LOT of money. I like my job, and I've had lifestyle jobs that I absolutely LOVED. I can't say that I have ever loved a job so much that I would turn down that much money to leave.
If I was staying I would be pretty annoyed, the people that leave get a bag of cash, and the people that stay get to pick up the slack while their former colleagues get on twitter to dump on the company?
> For instance, when you fund a company in its early stages,
> you might want a founder who will microdose LSD at work,
> because that’s just the sort of imaginative, aggressive,
> independent thinking that might change the world or whatever.
> (“Narrative violation: This CEO drops acid,” etc.)
> But when you are looking to take that company public,
> you want a CEO who would never microdose LSD at work,
> because that’s the sort of thing that stodgy
> institutional investors and regulators will find unsettling.
> If the founder-CEO has been microdosing acid all along,
> and you have been encouraging him to do so,
> there will be an awkward transition when you tell him to stop.
(The whole section is good, but this is a good summary paragraph)
Just like no one cares (in the tech world at least) if you drink like a fish or get stoned every night if you show up the next day and get your job done.
As a South Asian, I think there's more meaningful discussion to be had on the "bamboo ceiling" and, in particular, how Chinese collectivist views interact in increasingly global economies. This core tension between the two views isn't going to go away. Perhaps the Eternal September is upon us?
Someone actually did it for you already!
Needlessly aggressive response.
ex•pound intransitive verb To make a detailed statement. intransitive verb To explain in detail; elucidate.
The major one: in the West, the expectation is that everyone will express their opinion and be respected for it, even if their opinion is a minority. If you disagree with the boss, you're expected to say so, even to the point of having an actual argument. In the collectivist view, disagreeing (even privately) with those in authority is a huge no-no. Having an argument with your boss is roughly on a behavioural par with taking a dump on their desk.
It's easy to see how a collectivist boss would be criticised by Western colleagues for not allowing free debate or gathering enough opinions on a subject.
The thing that really causes issues, is "airing dirty laundry". Ie, don't ever disagree around people outside of the company, don't complain to people above your manager or outside your org and don't gripe on company slack channels if it undermines your superiors.
Can we just stop for a sec and collectively roll our eyes at VCs (and our own) trope of a “tech leader”? We want some kind of decisive, basically tech bro, alpha to come in and boss people around without any context. We want the startup CEO to be a wunderkind, and magically know the right call to make at any given point. There’s little room for consensus based leadership, which has its own place. How often have you had the “hard charging leader” come in and make a mess because their confidence outstrips their know how?
I’m not saying one leadership style is better than the other, I just hope we recognize good consensus based leadership should be valued as well, and it’s rather undervalued in tech culture in favor of people that sometime make a lot of noise, but end up being completely full of it.
I could be wrong but on the surface it looks like he’s looking for an excuse to blame something else.
That stereotype was for Japanese who stereotypically seek consensus (but it’s more an expectation that you will agree with the boss rather than achieving managerial nirvana). In any case I have not seen that as a stereotype for Chinese or Taiwanese or any of the Chinese diaspora enclaves in Southeast Asia so it almost seems like someone wanting to take advantage of other people’s uncertainty of a stereotype where it’s kinda plausible.
It seems likely that some leadership styles are better than others and plausible that techbrocracy is better than a more circumspect style for companies like this.
Variety of styles at various similar firms might have benefits, but I don't think it's fair to assume that variety is worth while without an actual argument or evidence.
I haven't seen solid evidence that that is the case.
Here's an alternate hypothesis: high-capital investors & wall street types aren't actually that good at determining quality management at all, they grew up in affluent social circles where "professional bro"-esque (be it finance or tech) people were common and respected, and they project those views onto the companies they invest in. Getting investment capital from these people is as much about cultural homogeneity with the "old money" types as it is about having a brilliant idea or a good execution plan.
It's worth remembering that most of this capital is being invested by people who just inherited the wealth from their parents, they're not necessarily genius market participants.
e: And I'm downvoted, why?
(Note, I called this plausible, not correct or even likely.)
Seeing how much more wealth there is now than there was 40-60 years ago it just doesn't seem plausible that most of the investors just inherited it. Extraordinary claims - extraordinary evidence please.
Sure, the estimates range from 50% to 65% of all private wealth in the US being inherited by the 5% most affluent households [0]. This logically implies most of the wealth held by affluent households is inherited.
Certainly, those at the very, very top (ie. the literal top 10, like Gates, Bezos, Musk) of households are likely to have built their own capital, but I'd also point out that there are plenty on the top list that have inherited it, if you look at the top 15 wealthiest Americans, 5 of those arguably did not earn their wealth (the Waltons, MacKenzie Scott, and Charles Koch). [1]
[0]: https://www.washingtonpost.com/us-policy/2019/02/06/people-l...
[1]: https://en.wikipedia.org/wiki/List_of_Americans_by_net_worth...
As to sources: what politically motivated newspaper claims in an opinion piece isn't meaningful. I look at the list of richest Americans and I see the vast majority (90%+) or even all of them were involved in building the fortune.
When googling around for numbers it seems most sources claim that vast majority of world population millionaires are self made and even bigger percentage of billionaires are.
Personally all the people I know who did well for themselves didn't inherit anything. I am sure my perspective is shaped by being born in a very poor communist country but it seems the actual numbers worldwide don't contradict my intuition that fortunes bigger and smaller are mainly built and rarely inherited.
Look, I'll grant you that Scott is "arguable" as I said, Koch is also very arguable.
I don't think you can seriously claim the Walton heirs earned their wealth, but I don't think it is particularly relevant to the debate.
> what politically motivated newspaper claims in an opinion piece isn't meaningful
I only cited the WaPo because it collated the econometrics papers that showed the claim. Look, you choose whether you want to believe, whether it is peer-reviewed economics research and meta-analysis or "googling around for numbers." We all know how reliable Google is :)
> it seems most sources claim that vast majority of world population millionaires are self made
I also googled this "claim", and huh, guess what showed up? A bunch of "politically motivated newspaper claims" but this time they were relying on this obviously biased source (https://www.wealthx.com/report/world-ultra-wealth-report-201...), not peer-reviewed economics research.
Ultimately, you choose what to believe but almost all the evidence points to the majority or close to the majority of private wealth being inherited by the wealthy.
> Personally all the people I know who did well for themselves didn't inherit anything
1. This is 100% contextual to America 2. Many people are very shy about admitting an inheritance.
I also don't really trust you to be a good judge of if someone is "self-made" if you honestly think the Walton's didn't inherit their wealth - pretty much every one of them is described as an heir/heiress and they were not actively that involved in the business.
You choose what to believe, but ultimately "facts don't care about your feelings." You seem to be reasoning backwards from your political beliefs to the conclusions you want to hear.
Given that the company was founded and formed under Zhu's leadership, it was probably exactly suited to his leadership style[0].
The new factor appears to be the VC's. It's not so common now, but VC's used to have a reputation for replacing founders with "experienced" CEOs - y'know: their mates from the golf club who could be counted on to play ball nicely. This was especially common if the founder was unconventional in any way.
[0] TFA doesn't mention any internal management problems, so I'm assuming all was well and there wasn't any dissatisfaction with the leadership style. That assumption could be wrong.
And it's a pretty obvious conclusion from:
1. the fact that GPs have to put up $10s of millions into the fund to get the job
2. most (>50%) wealth held by affluent people (like the people who become GPs) is inherited from their parents.
These are people who grew up in affluent social circles and want people like them managing the companies they invest in.
Who exactly wants this? Neither Tim Cook, Sundar Pichai nor Zuckerberg fit this description. The vast majority of tech leaders seem like consensus builders, as opposed to this "alpha leader" trope.
The fact that even the most assertive tech leaders are more "chair throwing tantrum incident" at most may be part of their aggro. "Normal people" get irrationally pissed off at things not meeting their prejudices and preconceptions. In this case the lack of "alpha bro" at the top. They cannot imagine a lack of this as seen in the shibboleth of the clueless "techbro" perojative.
You don't see vandalism for decades saying "Wall street go home!" in the Bronx in the face of gentrification even though the rough consensus is that Wall Street is a bunch of priveledged douchebags.
Except for Google.
Allen writes in Idea Man that Gates “thrived on conflict” and “would demean people and force them to defend their positions.”
https://m.huffpost.com/us/entry/us_850292
Gates was famously the office bully. He dressed down employees in public, hurled sarcasm at rivals, and would reportedly troll around Microsoft's parking lots on weekends to see which employees were working overtime.
https://www.gq.com/story/young-bill-gates-was-an-angry-offic...
Otherwise it’s just a bull in a china shop stepping on and sh*ting on a lot of pre-existing work and stakeholders who did the work. Easy way to lose an org trust and never get it back unless a ton of headcount churn occurs such that no one really recalls how much of a moron the lead was.
I'm sure there is anti-asian sentiment (or at least discomfort) out there, but replacing a CEO once a company gets big enough to need it is absolutely routine.
Founders get pushed out by VCs all the time.
You can see it even today. People who know who they are...are in the thousands whereas people like Bezos and Musk seek to be known by the whole world.
If we know something about the promotional industry is that you only become famous if you want to.
The two investors with whom Zhu seems to take issue were born and raised in South Asia and Turkey, respectively.
Zhu was replaced by his co-founder (who supported Zhu's firing) who is of East Asian descent.
Zhu believed "the company were too focused on sales and money at the expense of altruistic goals". Excuse me? You're running a company with other peoples' money at stake with the express understanding that you will seek to maximize their returns.
Zhu was the one who publicized the LSD incident (which was NOT a microdose, as he admits) via his contact with a reporter. The board actually tried to intervene. Imagine finding this out as an investor. Now all your company's current and potential customers, partners, and investors know that you've got an Adam Neuman type at the helm. That's got major potential to harm investors.
Ultimately, this reads as an egoist who can't sufficiently control his impulses. It's a wonder he wasn't fired sooner.
Separately, much of the reporting on this has been emblematic of the sorry state of journalism. This article, for example, bends over backwards to draw tenuous connections between racial bias/identity politics and Zhu's firing. Truly shameful.
I have struggled with this question a lot and taking a bigger picture view helped me understand the systemic problem.
The exact same reasoning was used by some social media users to argue that there was no racial motivation in the case of George Floyd's murder by Minneapolis police in May 2020. One of the officer was East Asian and another was not white but the man who had the knee on the neck of George Floyd was white and was the superior officer.
I can't conclude that all the power over Mr.Zhu in this case was in the hands of the two VCs you mentioned.
I am saying racial bias should be viewed with the lens of the larger system or world in which we all operate.
You can't simply abstract all of Asia, from Turkey to China, as a singular monolith. Now's a good chance to point out that the MIT 'Bamboo Ceiling' paper from 2020 makes this distinction in the title:
"Why East Asians but not South Asians are underrepresented in leadership positions in the United States"
https://www.pnas.org/content/117/9/4590.short
"You’re just pattern matching,” Zhu recalls telling them. “Your last 20 CEOs who went public, they were probably all Caucasian guys.”
Note again that the same board replaced Zhu with his east-Asian partner, who also supported Zhu's ouster, and that each of the investors in question had funded other major start-ups with east-Asian CEOs.
A guy has a cool idea, then he needs money to make it big. Some people give the money in the hope that they will maximize their return. The fact they give money doesn't give them total power.
I've been in that situation of having a cool idea with investor interested. Believe me, those with the money quickly think your idea is theirs and all of a sudden you're reduced to that : an initial idea, a starting point. As soon as money is put in, you basically don't exist anymore. I don't consider that a fair deal; it's a deal with vultures.
So, yep, Zhu got my sympathy.
If you "need money to make it big" you can bootstrap, take donations, or look for investors.
It's easier to raise investment than donations, because an investor expects a return in an economic/probabalistic sense(not hopes for a return)
You can't have your cake and eat it too though; once you accept investment you can't cry foul when they don't sit back and act like a donor.
But Iterable's mission (quoting from its career page) is: "We empower growth marketers." Its products help your organization get more juice out of emails, texts, etc.
That's a busine$$ -- and it's very much an area where money can be made. I'm struggling to see how this could be an altruism play, too.
I wonder why in this case it's different, yet another tech CEO/Founder can go to Burning Man, trip on LSD and peyote, brag to everyone they were out of their mind at Burning Man, and face no consequences.
I feel the LSD wasn't the main problem. Zhu just didn't manage the company in a manor they felt comfortable with and used any pretext to cast him out.
To which CEO are you referring? Also, the comparative context is very different. One (Zhu) is in a fundraising meeting with a potential investor (i.e. in professional capacity) whereas the other (your hypothetical) is at a festival (i.e. a personal capacity).
> I feel the LSD wasn't the main problem. Zhu just didn't manage the company in a manor they felt comfortable with and used any pretext to cast him out.
I agree. The article seems to suggest that the LSD incident was merely emblematic of a trend of behavior with which the board was unsatisfied. In fact, reading between the lines, it actually seems like the board was more troubled that Zhu chose to publicize the LSD incidence via a reporter.
Hard to say he lost overall if he is walking away with 8-9 figure equity.
Companies can't just kick someone off the cap table once they have vested equity.
There’s no shortage of stories out there of founders being burned by VCs once the company has real money behind it.
Down rounds and massive dilution absolutely happen, but this hits the entire cap table.
"He wore cargo shorts and a T-shirt to a meeting with Geodesic, a VC firm founded by John Roos, a former U.S. ambassador to Japan. An Iterable board member later informed him Geodesic wouldn’t invest, implying it was partly because of his casual attire. A person familiar with the firm’s thinking says Zhu’s attire didn’t factor into the firm’s decision"
So was it the shorts or was it not the shorts? If the reporter has a solid source saying it wasn't the shorts, then why bring it up at all, unless the gossip aspect of it fits your narrative...
- taking LSD
- arguing with board members
- wearing cargo shorts
Rather, his mistake was not retaining control of the company he founded, either by bootstrapping it entirely or not taking venture capital. Contrast this to the recent Basecamp debacle, both cofounders owned 100% of the company and could do as they pleased, no one could fire them.
I disagree with this notion, even as you might agree. If I'm making a company, it exists for my sole pleasure. If it didn't, then I wouldn't have bothered creating the company in the first place.
> The board is the CEO's boss, and just like with any boss, behavior has consequences.
I would make a company to get away from having a boss at all, not so that a board could now be my new boss.
From the article, looks like that wasn't the actual reason. The actual reason is that Zhu preferred his own personal brand PR (with heavy social justice activism overtones, accusing anybody who challenges him of racism because he happens to be of Asian descent) to the good of the company, and was unwilling to reconcile the two.
If he was refusing to make this change then it probably was just a bog-standard power struggle.