Noam Wasserman's "The Founder's Dilemmas"

Noam Wasserman’s “The Founder’s Dilemmas” is a knowledgeable and accessible quantitative analysis of startup dilemmas – when to found, with whom, how to split equity, when and whom to hire, when to step down as CEO, “king v. rich”, et al.  Let’s say you’re an “average” startup professional, say a VC, banker, lawyer or consultant.  Wasserman’s data set is huge – several thousand startups over a ten year period. But - you’ve faced these dilemmas a hundred times, you know what works and what doesn’t, you know the applicable tweaks and the strengths and weaknesses of different approaches.   Do you really need to go through 350 pages of (albeit well-written) quantitative analysis?  Can you actually learn something from someone else’s war stories? The answer is yes for two reasons – one, mathematics, and two, humility.  First, the math. Scholars study large entities and large samples so that they can weed out the idiosyncrasies of any given situation and better find the patterns that are applicable to a larger sample – ie, are more genuinely representative and thus more likely to be similar to a given situation at hand.  Take as an example 50/50 equity splits between founders. Your “gut” (and common wisdom) is that these divisions are highly problematic. True, but isn’t it better to see that X% of these splits in a  large sample led to negative results of Y? Isn’t your “gut” better tuned to seek out those few situations in which this split might be effective?  One need not cite statistical chapter and verse (“73% of these situations in a  sample of 2500 companies led to a split within 2 years”) to be able to use such statistics to better advise founders. Or do you really wish to sell your advice solely on your “gut”?  Second, the humility. Anyone who has dealt with entrepreneurs knows the ferocity of their passion – and anyone who has studied behavioral economics knows the cognitive biases that cloud everyone’s (including entrepreneurs’) judgment. Entrepreneurs by nature or definition are more likely to go it alone or step away from the “certain” middle path. They are idiosyncrasy writ large. Again, say you are an “average” startup professional – have you really heard every story, seen every arrangement under the sun? Even with 30 plus years of experience, a degree of self honesty and humility would dictate that the answer is no. Therefore, Wasserman’s “war stories” may also be of help. I, too, am an old dog, but I always want to learn new tricks.  Wasserman’s book is well worth the read.

Interop - Theory and Practice

Harvard's Berkman Center has produced some of the best thinking around on the relationship between technology and society.  The latest book by its John Palfrey and Urs Gasser - Interop: The Promise and Perils of Highly Interconnected Systems - does not fit into that category. Interoperability - the ability of systems to communicate with each other and thus function in tandem is indeed critical to the functioning of increasingly complex and interconnected systems. Palfrey and Gasser go in search of every scholar's meme - a theory of interop - and fall flat. To describe what interop is is not to describe what it really means. Rather, since by its nature it is so complex, adaptive and ubiquitous, one wonders what gain a proper "theory of interop" would grant. Ultimately, it doesn't matter because Palfrey and Gasser simply give example after example of interop while failing in their self-set task - to unify a theory of it. Anyone with even a passing familiarity with technology will find this book uninformative.  Better luck next time

You are not Steve Jobs

Yes, Walter Isaacson's biography of Steve Jobs is a great work about a fascinating man. When Jobs does it was amazing to see the outpouring of sympathy for him on cyberspace - this for the CEO of a large company at a time when CEOs were viewed as barely better than rapists and murderers. People talked at that time, and when Isaacson's book was published, about how "inspiring" his life had been. Clearly, Jobs had been no ordinary CEO and, reading not too far between the lines, he could have been a much better one, as well as being a better human being (at which he was godawful). He was a visionary whose vision was so acute that he could create markets where none had existed before. His most audacious statement - "Some people say - give the customers what they want. That's not my approach. People don't know what they want until you show it to them". Brilliant stuff, right? Inspiring, right? WRONG! Not wrong because every Harvard Business School professor will tell you so, though they will. Wrong for a much simpler reason - you are not Steve Jobs. He was a one-off (perhaps thankfully), and no amount of "inspiration" will give you his gifts, Most of us (nay, all of us) lack any degree of Jobs' vision - and  so what? We can still appreciate the beauty and brilliance of his products (I deliberately keep my iPhone unsheathed just to look at its lines). We can stand in awe of his accomplishments, and in judgment of his faults. But if we try to imitate him, we'll fail. I am reminded of an old Hasidic tale - the rabbi finds Mendel alone in the synagogue, weeping. "Why are you weeping, Mendel?" asks the rabbi. Mendel looked up and said "I am old and dying. I am not a great man of learning like you, rabbi, I am a simple farmer. But when I go up to heaven, I am farid of the question I will be asked". "What question is that?" the rabbi asked. Mendel replied :God will not ask me why I have not been a great scholar or pious figure. He knows the modesty of my accomplishments. Instead, he will ask me if I have been the best Mendel I could have been, and that question I fear".  Don't try to be a pale imitation of Steve Jobs. Be the best Mendel you can be.