Tuesday, September 13, 2016

Another dispatch from the wild frontier of the tech business

Disrupted: My Misadventure in the Start-Up BubbleDisrupted: My Misadventure in the Start-Up Bubble by Dan Lyon

Disrupted fits neatly into an entertaining genre of first person accounts of the madness of the tech revolution. Michael Wolff’s Burn Rate (1998) was an early classic, a hilarious account of a dot com startup that failed to deliver the promised riches to Wolff or anyone else involved. Start Up by Jerry Kaplan (1994) and The Leap by Tom Ashbrook (2000) both tell similarly sad tales of startups that are no longer with us. Then there’s Amazonia (2004), James Marcus’ record of Amazon’s messy transition from employing writers like him to deciding that algorithms did a better job. Douglas Edwards’ I’m Feeling Lucky (2011) is set in the bizarre world of Google. And there are more.

The best of these books are written by journalists who were unable to resist the promise of easy money, and, foolishly, it usually turned out, jumped on the tech bandwagon. Things never quite work out as hoped, and, either to exorcise the disappointment or because it’s the only work then on offer, the ex-journo, having left the business, produces a book about life in the crazy world of tech startups.

What makes Dan Lyons’ account special is his extreme cynicism about the company he’s joined from the moment he walks in the door. Indeed Hubspot, as it’s called, does appear to be gripped by its own brand of world class lunacy. The inevitable decoupling between our hero and his techie colleagues is especially bloody.

HubSpot is (still) a Boston-based marketing company. Lyons’ descriptions of it reminded me most of a fictional tech business, The Circle in Dave Eggers’ 2013 book of that name. There are the same armies of eager young people, the same cultish devotion to the company’s ideals and the same grandiose ambitions, somewhere between inspired and unhinged.

I mean, would Eggers have considered this plausible? HubSpot’s co-founder, Dharmesh Shah, brings a teddy bear called Molly to meetings to represent the customer, because in the words of Shah’s manifesto for company culture Hubspot should always be “solving for the customer” (shortened to “SFTC” in the company)? Hence Molly sits there, to remind everyone of the customers. Shah even posts a picture of Molly in her little chair at a meeting on LinkedIn. Lyons is not impressed:

“Here are grown men and women, who I presume are fully sentient adult human beings, and they are sitting in meetings, talking to a teddy bear. And I am working with these people. No: worse! I am working for them.”

Then there’s the company mantra of HEART, the values HubSpot aims to live by: Humble, Effective, Adaptable, Remarkable, Transparent. Everyone gets a mark for each of them from their manager, which as Lyons points out, seems more like just a measure of how much their manager likes them.

All that kind of thing may be silly, but is unlikely to give anyone a nervous breakdown. What might is the way Lyons was ostracised by his colleagues for not being ‘HubSpotty’ enough (the term being a straight imitation of Google’s ‘Googly’). Meanwhile, his bosses switch unpredictably between non-communication, being warm and supportive, and subjecting him to bullying campaigns of nit-picking micromanagement in which, by his account, he was constantly tripped up despite playing along with the demeaning tasks he was set.

The story is a gripping and pacey tale of highs and lows, with some vivid character studies. But Lyons uses them to make bigger points. First, he shows how a narrowly-defined company culture in which people are praised for being ‘a good fit’ can be a proxy for a discriminatory regime. In his case, for example, he claims the culture disadvantaged older workers like him. Lyons called out the co-founder for as good as admitting as much in a published interview.

Second, he puts HubSpot’s IPO - from which, against the odds, he profited modestly - into the context of other tech flotations in today’s bubbly market. He argues that while the venture capitalists and founders get extremely rich, the ordinary workers don’t – at least not as much as they used to. And that the business fundamentals of the likes of HubSpot are not as solid as they should be for a stock market flotation. They are often still not profitable, and may never be. For the market, the only metric that counts is sales growth. But while that may impress share buyers who provide the original investors with a windfall, it’s not a good basis for a long-term bet on a company.

If you’ve been surprised by the book, you’ll be astonished by the epilogue. Serious but unspecified crimes are alleged in connection with some of the people he’s depicted, about his writing the book you’re reading. But far from that making publication a problem, Lyons goes the other way: he gives us the real names of more of his protagonists. It’s a dramatic and disturbing end to the story.

So what did HubSpot say about Lyons’ apparently damaging portrait of its strange (at best) ways? Well, they addressed some of his complaints in a statement on Linkedin. There are a few admissions, including on diversity. But many questions remain unanswered. There’s no comment, for instance, about the extreme treatment to which Lyons was subjected by his manager. Nor of the criminal allegations.

There’s enough in this book to make great film but it would be much darker than The Social Network. Lyons describes his trademark journalistic attitude as “acerbic”. I’d say it ranges from caustic to, occasionally, plain bitter – albeit with apparent good reason.

It remains to be seen whether in years to come Disrupted will be of interest on account of Lyons’ attitudes as an older worker having difficult adapting to the 21st Century workplace, or because of Hubspot’s bizarre but, it turns out, transitory workplace and business practices.

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