HN Theater @HNTheaterMonth

I watched Marc's interview at

https://www.youtube.com/watch?feature=player_embedded&v=NEOR...

Here are my reactions:

As a preliminary note, Silicon Valley, Marc, and the entrepreneurs are all looking for things that are exceptionally good.

Then:

"Professional CEO".

What Marc describes is an SVP Marketing or at best a COO.

Marc lists as the tasks of a CEO as marketing, sales, finance, recruiting, etc. Nope: For each of those there is a VP, SVP, etc. Over them all is maybe a COO. The CEO is none of those things. Sorry, Marc.

The problem with his professional CEO as the actual CEO instead of the founder is that the pro CEO doesn't have a good understanding of the vision for the future of the industry or the company and is not able to evaluate technical projects within the company or evaluate and hire technical people or leaders. So, the pro CEO is basically and at best one trying to SELL, SELL, SELL the EXISTING product/service.

So, right rush out and sell 300 bps dial up modems, and keep growing to 9600 bps but forget about coaxial cable modems, wireless, and fiber.

Marc wants the CEO to be a cracker jack buggy whip salesman, buggy whip production manager, buggy whip sales channel expert, etc. when Henry Ford is bringing out the Model T. Bummer.

Marc mentions Tom Watson, Jr. who one day, when IBM was still with punched cards and electro mechanical equipment, mentioned to his father (IIRC): "There's a guy at Columbia. I don't know what he's doing, but he's doing it 200,000 times a second."

Well, Tom, Jr. should have been much farther ahead on that theme. Being behind that way is part of why IBM had to play desperate catchup with System 360 and still missed out on a lot that Burroughs, DEC, etc. had. And soon IBM was just blind to what was in Multics, DEC VAX, the future of x86, etc.

IBM VM? First done at IBM Cambridge Research Center as CP67/CMS just as a means of time-sharing operating system development. The real power of VM was missed for a long time.

IBM was awash in people ready, willing, able, and eager to do great things for IBM in operating systems, system security, file systems, programming languages, etc. -- at one time one such person lamented "Three times in my career I tried to help IBM in operating systems, and three times I broke my pick trying.". Bummer.

Marc has general partners "who have been through the struggle". Well, that's like having a lot of steam engine experts at the beginning of electric motors.

In fact, the nature of "the struggle" is changing. To do well seeing what's new, Marc is looking in the wrong place.

There are better places to look: E.g., in 1940, the US military was really smart and didn't plan the new weapons by talking to people who had "been through the struggle" in WWI with artillery, battleships, and biplanes. Instead, what was crucial was Reynold's number in fluid flow (the reason we got rid of biplanes), radar, radio, high resolution cameras, sonar, monoplanes, the proximity fuse, torpedoes, computers, super charged engines, aluminum in airplanes, encryption, code breaking, and the A-bomb. Nearly all of that was from people with more fundamental backgrounds than having been "through the struggle" of WWI.

Marc needs people with more fundamental backgrounds.

Marc talks about "the shit", just "all the stuff that happens". Well, in poorly planned and run projects, yes. But, J. Oppenheimer got the A-bomb ready on time, about as soon as Nimitz, MacArthur, and Boeing had Guam and the B-29 ready. A well planned and run project has a lot less "shit". Admiral Rickover did the same with the US nuclear submarines. The US Navy did the same with their version of GPS, some years before GPS. Similarly for Keyhole -- before the Hubble, essentially a Hubble but aimed at the earth. Lockheed did the same with the SR-71 -- Mach 3, 80,000 feet, 2000 mile range, never shot down. Etc.

Marc has seen a lot of "shit" because he has seen a lot of poorly planned and run projects because he doesn't know where to look for good projects.

Marc mentioned that his firm has a big "matrix" that helps a new CEO with selling, buying, funding, recruiting, etc. Okay. At times that might help.

But, take recruiting: The whole goal of a VC funded company is to be exceptional. Well, I question if Marc's firm is able to select the needed exceptional people, and later in the interview there is good evidence that he can't.

I have to move on. But, in short, to me, the worst thing Marc said was on how a CEO should evaluate VCs and engineers: Marc's main technique was recommendations.

Wrong. Badly wrong. Here Marc is asking the CEO of hopefully a very exceptional company to draw from the knowledge of the general environment instead of using his own exceptionally good abilities, which necessarily we hope he has, to make much better, exceptionally good, decisions himself.

Similarly Marc is impressed by computer science, AI, and ML. Nope.

For the needed exceptional companies in information technology, f'get about computer science: Instead look more broadly in the QA section of the library, especially at selected topics in pure and applied math. There will see AI/ML as mostly special cases of statistics which is a special case of applied math which is a special case of pure math. Better to look at pure/applied math and mathematical statistics.

⬐ david927

I think you're being a bit tough at times but you definitely hit a vein.

It's always funny when VCs give a talk like this because they will invariable mention how they are down-to-earth ("been through the struggle") and how modern they are, when the truth is that they are anything but.

Warm introduction? Really? Is this straight from an episode of Mad Men? They know very well that they could hire one or two people to take decks from cold sources and run a preliminary review. They don't do that because they want to perpetuate the system. It's an "old boys network" and there's a real effort made to keep it that way. Let me repeat that, the reason they will never get rid of the warm intro is that it's all about perpetuating the old boys network.

Peter Thiel, when speaking to Stanford students, talked about vetting and said, without irony, that coming from Stanford gives you that vetted quality and that (IIRC)"you can give some song-and-dance about how your parents didn't have enough money so you had to go to UC Berkeley, but we all know that's not going to work." (Which is funny because my old roommate who went to UC Berkeley was mentioned in Perlmutter's 2011 Nobel speech; I wonder if he knows that he doesn't rate.) The difference between Cal and Stanford is about money and the perpetuation of wealth across generations, and that's also what we're talking about here: an old boys network.

Professional CEO = crony. Nothing else. The tragic part of all of this is that there is serious innovation waiting to happen and the system that could support and enable it is instead too busy preserving and extending antiquated systems of power and wealth.

⬐ graycat

> Professional CEO = crony. Nothing else ....

Yup. The pro CEO totally owes his job and even his career, house mortgage, the mother in law addition, the in ground back yard pool, the kids' college tuition, new family SUV, wife's happiness, the family vacation home, his retirement, his good medical plan and dental plan, his airline travel card, his company car, country club membership, the respect of his circle of friends, etc. to the VCs.

Then the BoD and CEO can agree on this and that and send the whole founding team out without even their shirts. The founding team can sue, but without even their shirts and against the money and power of the great company they built, they don't have a chance.

So, we're talking CEO loyalty to the BoD, sit, lie down, roll over, stand, heel, etc.

The VCs with the BoD are in a power struggle with the founders, and the ones with more power get more money; the one with enough power can get ALL the money.

I omitted, the people I could get a "warm introduction" from are so high up in business and academics that the Silicon Valley VCs don't know them. And the Silicon Valley VCs don't know the people I know and couldn't get a warm introduction to me. E.g., in information technology, the people I respect and are able to respect me all have good appropriate Ph.D. degrees, usually pure/applied math, and nearly no Silicon Valley VCs do.

To put it bluntly, the Silicon Valley VCs are "too low class" for me! Really, I don't care and am willing to give tutorials to people with poor technical prerequisites for my work, but the VCs wanting "warm introductions" look too arrogant to me. Or, I'm not going to go to one of my Ph.D. dissertation advisers, since then a Dean at one famous university and President of another, and ask for a "warm introduction" to a VC that likely does not know him.