Archive for the ‘rants’ Category

The 100-hour work week myth

Sunday, July 5th, 2009

Chris Yeh calls out workaholism as the stupid choice it is:

If you work 100-hour weeks, no one (investors, co-founders, employees) can blame you if things don’t work out, right?

And I like to think I’ve worked a lot smarter since then [missing dinner with spouse].

The life of an entrepreneur can be rough, but at least it’s a life of your choosing. The same can’t be said for your family. Give then a chance to make their own choice.

In other words, it is the default choice in the valley and in the technology sector. And its a stupid choice. 168 hours in the week. 100 hours at work. Allow 8 hours/day for sleep. Drive-time to/from work of 1 hour. This leaves exactly 13 hours for the employee to do *anything else*.

A few years ago, I had a job with the best work-life balance. This start-up had with only 7 engineers with 30-ish total people. Between November and January, we built a Paypal integration and a major piece of functionality that got the start-up their first bits of solid revenue. Everyone took their normal holiday vacation. Every programmer worked 9-5. No weekend work. We completed the project on-time.

The company is LinkedIn. We achieved this because Jean-Luc Vaillant was fanatically about knowing exactly what was to be built and automated tests so he knew exactly where the code was. Those tests had to pass each and every night. No new work was to be done until all the previous night’s failed tests were fixed.

Every later employer had to live up to this reasonable bar. Sadly most fail and most projects are late.

They fail because the managers listen to the siren song singing the lies:

  • that says that automatic tests are optional;
  • “trusting” the developer to adequately test by hand is good enough;
  • that there is more time to do-it-again than to do it right
  • that documentation is optional and it better to have team members figure out anothers work than it is to demand that the creator document;
  • and that long hours are better than sane hours

While Chris does touch on the work-life balance with his wife, he misses some key points. If the team is working 100-hours/week:

  • the team has no reserve capacity – if a short-term sprint is needed to wrap up a project – forget it
  • the team starts to waste time at work: web surfing and game-playing. So while physically there, they are neither productive nor getting a break from the work environment.
  • as soon as there is any corporate setback – moral collapses. When it looks like the company is going to be the next Google, employees will justify to themselves that working ridiculous hours will pay-off. This illusion is dispelled at the first severe setback.
  • someone outside of work is always telling the employee how stupid they are to work such long hours. The wife, the husband, the kids, the mother, or just the friends who are going up for that most excellent ski trip to Lake Tahoe.

So my advice to employers:

  • Get rid of the game room. Make employees have fun outside of the building.
  • Cut the power to the employees computers at midnight. Make them sleep so they can think and not make silly mistakes.
  • Do a postmortem on every crisis. Without blame and with automation ONLY, look for ways to make sure that the crisis can never, ever repeat. Working “harder” or requiring greater “perfection” is NOT the answer.
  • Reward employees – not for working harder, freeing up ‘capacity’. Did some developer, IT person, or janitor do something or automate something that freed up 20 minutes/person/week? In a 30-person startup, those 20 minutes saved is the same as hiring a full-time person for 3 months! Get everyone to look for these “small” time-savers. Work now becomes less onerous, more enjoyable, and your headcount stays down.

Expanding on the last point with some examples:

  • Automatic tests — avoids developers acting like monkeys do manual tests.
  • Buy the absolute fastest machines. My latest machine took me from 15 minutes builds to 1m30second builds. I started running the tests all the time!
  • Virtual assistants to handle the random shit that an employee might have to do during the day
  • Every 6 weeks, a mobile oil change service so that no one needs to run to Jiffy Lube
  • Outsourcing human resource issues

Spend the time to discover those “small, annoying” things that seem to petty to complain about — but that impact a significant percentage of the company.

Remember for a small 30-person startup saving 1hr20m/person/week ( i.e. 16min/person/day ) is the same as hiring another person. And in the process, enables everyone to step back from the brink.

Google has their famous 20% “free” time to work on new projects. Every startup should have 20% “free-up” time to make existing projects less painful.

While I am working hard at amplafi I am working even hard on making sure that my family knows I much rather be with them than coding.

Also read Steve Blank’s post on the Lies told Entrepreneurs.

Update ( 27 July 2009 ) My response to Paul Jozefak, a German VC, guest blog post:

Strongly, strongly agree with:

Ask me what I see lacking most in startups in Europe and I’ll say hunger, drive, and lofty goals.

For me my hunger and drive come directly from wanting to change the world for my children.

So I equally strongly DISagree with:

worked four jobs for the money to launch their venture, without giving a second thought to “quality of life” or “spending time with the kids.”

For me sacrificing the hours between 6:30-9:30pm that I spend with my kids is a false choice. I sacrifice that time only when absolutely necessary and never more than 2 days in a row. Once I have those 3 hours with family, I am emotionally recharged and able to focus completely on building my company, Amplafi.

I am not alone in this. Chris Yeh and Steve Blank : Lies Entrepreneurs Tell Themselves share my feelings.

My personal reality is the least successful company demanded the worse and longest hours. And the most successful startup asked the most reasonable hours. We work from 9-5. No weekends. No missed holidays. You might have hear of it. Its called Jean-Luc Vaillant did his job and managed his people well.

Shitty long hours is not a badge of honor. Its a sign of bad prioritization and resource management. Sure some times the long hours are necessary… just like a sprint is necessary at the end of a marathon. But you don’t sprint the entire length of the marathon. And unlike a marathon in a startup, there is no rest after crossing the first finish line – just another finish line in the distance.

A startup that is sprinting constantly better hope that they get bought before exhaustion sets in. Otherwise their competitors that have paced themselves better will pass them up and their best people will burned out and quit. Any little stumble, any sign that success and glory are a few months away… and the startup starts spending time looking for fresh blood.

Posted in amplafi, management, rants, starting a company | 4 Comments »

Open Message to the anti-tax crowd: move

Wednesday, June 17th, 2009

Amazon’s definition of “unconstitutional” :

“We don’t like it”

I love all these people who whine about taxes.

Don’t like taxes? Move to Somalia. No functioning government since Bush the First – a libertarian paradise.

The anti-tax people complain about taxes but want the benefits of:

  • a functioning University system so that there are high-quality people to work at your cool start-up
  • a public school system that at the very least keeps kids off the street. (50% of California’s budget)
  • roads
  • police
  • prisons ( 10% of California’s budget )
  • state parks
  • a functioning emergency system for the next airline crash or the next earthquake
  • airports
  • Caltrain
  • weights and measures people to make sure that when you buy a gallon of gas you get your full gallon
  • code enforcement to make sure a restaurant is not serving 3 month-old rotten meat and the kitchen is not infested with cockroaches
  • zoning enforcement that stops your neighbor from running a chicken farm
  • labor laws that stop child labor and insist that your employer actually has to *pay* you
  • SEC laws that require that companies follow GAAP
  • laws that allow lawsuits and action against companies when they pollute the water you drink

Next time you think that the government does nothing for you. Spend some time finding out how badly mainland China, Dubai, or Yemen allows the powerful to abuse everyone else.

I can go on and on.

But seriously, grow up. You want to live in a civilized society? expect to pay for it — it does not come for free.

Oh sure, it isn’t perfect — fine make it better.

As for me, I am happy to pay taxes and enjoy the best state (California) in the US. There is no way I would move to another state that has worse laws.

Update 1:

A few other “unnecessary services” from the government:

Move to Somalia. Avoid these annoying bureaucrats!

Meanwhile think about this:

  1. In the 70’s corporations paid 2/3 of the taxes, today after a full generation of the rich whining about taxes corporations pay 1/3 of the taxes.
  2. 30 years after Prop 13, the biggest beneficiaries of Prop 13 are corporations because they never, never sell property ( 99-year leases anyone? ).

All this anti-tax rhetoric has allowed corporations to shift the tax purden to the individuals.

Maybe it is time to wake-up about this scam and stop buying into the anti-tax rhetoric so blindly.

Update 2:
More from TechCrunch:

State governments assess “emergency” tax measures to get quick money because they can’t bear the thought of making the tough choices necessary to cut spending

Hmmm… so in hard economic times, when a social safety net is that much more important you want states to cut funding.

So from your perspective:

  • Unemployment insurance
  • Job retraining programs
  • Community Colleges
  • 4-year public universities
  • subsidized day care
  • subsidized elder care
  • Section 8 housing assistance
  • School lunch programs
  • morning/afternoon pre-/post- school day programs
  • community grants for starting a new business

Should all be cut.

Someone who has just been laid off can try to job hunt and compete with 500 applicants hoping they can keep their head above water economically;

Or

they can return to school and complete their AA degree or the BS, or get their MBA using the above listed services to make it economically possible.

By providing these services, a state enables their citizens to be more valuable and more productive when the economy turns around.

The single mom ( or dad ) may start the downturn with no college education. Through the services listed above, this single parent could end up with a degree that will enable them to double their income. Or give them the skills to start their own business.

Yet you make the interesting choice that states should remove this opportunity to turn economic lemons into lemonade.

Interesting. I am curious why you think that a less-educated workforce is a good choice?

I should add that Herbert Hoover was wildly successful at cutting government spending in the Great Depression. I am curious do you think this was successful for him? If not how is the same approach going to be successful today?

Errata Note: Original post referred to Ethiopia. The correct country should have been Somalia. I usually know my geography much better. However, since Somalia now has a government (as of December 2008), the last John Galt paradise is gone. Thanks to Peter for pointing this error out.

Posted in political, rants | 5 Comments »

Stations do NOT affect train speed

Monday, June 15th, 2009

Bullshit from an email thread and repeated constantly by the California High-Speed Rail Authority:

“Other potential benefits are also intriguing: a probable economic windfall for several cities along the route . . .”
and
“There will be as many as 24 passenger stations along the way . . .”

The train could more easily meet speed requirements if it stopped less. CA should do some land use planning first, then plan the train.

How would a station affect speed? Every train has to slow down to say “Hi”?

Stations have nothing to do with speed. Stations are INFRASTRUCTURE.

Station STOPS affect speed. Station STOPS are an OPERATIONAL decision and can be solved with a schedule change.

How come no one talks about having fewer freeway exits as a way to make freeways go faster? Because its stupid, drivers don’t get on and off at every freeway ramp. Yet somehow people think that a train has to behave like a stupid driver who takes every freeway exit! How come people think a train has to stop at every station?

News flash!

Trains can skip stations! If a train doesn’t stop a station the existence or (non-existence) of a station is irrelevant!

California High-Speed Rail Authority puts out this BULLSHIT as an excuse to avoid building a system that could actually serve dual purposes as both a long-distance system and a higher-speed adjunct to commuter rail.

“We can’t build more stations because that would slow down the train!”

This shinkansen train doesn’t look to be at all affected by the station:

Update 1:

Questions and astonishment from the email thread:

I’m not a train engineer, but I imagine money is spent on building a station with the expectation that some of the trains stop – because people live or work there.

I would hope so myself!

If there are stations for which trains stop infrequently, is that good planning?

Yes it is good planning. Stations can be built at relatively low cost. At the lowest end just a long enough siding, a asphalt boarding area, a parking lot and a place for taxis/buses. Even for HSR there is no reason a low frequency stop has to have even a building. Sure the HSR trains might require a high platform but that can be easily handled with a portable “step-up” carried on the train.

If I lived, or had a business near that station, I sure would want as many stops as possible.

well of course you would — and I want a pony. Wishes don’t mean you get.

Communities around those stations will use the existence of the station as marketing to attract development, but should it be happening at all 24 stops?

How is this a bad thing? Communities promoting passenger rail is bad?

Might there be some type of express/local arrangement, where a slower local (on a separate track) can feed the HSR? That doesn’t come through on the article.

You don’t need a separate track for anything except the station area. The station siding just needs to be long enough to allow for acceleration/deacceleration off of the main line. ( about 9 miles on the acceleration, less on the deacceleration ) Unless we are talking very impacted ROW the extra track is minor. The siding track is only necessary when the OPERATIONAL issues dictate that a train stopped at a station needs to be passed.

It probably doesn’t come through in the article because this is another operational issue that is decided after system is built. Running a train slower that system maximum because it is a “local” only matters when a higher speed express wants to pass. If there is nothing coming up behind it, a train can run at 40mph on the main high-speed line or it can stay stopped for 10 minutes blocking the main-line track.

How many stops do you think a typical train will make?

The system being proposed can run a train every 3 minutes / direction. 20 trains per hour going the direction you want as a passenger. If a passenger is going from one low traffic station to another they might have to transfer but at least they get service from a station close to their house. Why are we going to make them drive a long distance when the tracks are next to them. So what if only one train stops per day? This is just like Amtrak today!

Just make sure that the entire end-to-end trip time does not exceed a policy maximum.

How is it decided which stations to stop at?

By the people setting the schedule — same as today. Don’t get this question at all.

you’ve GOT to be kidding! Train Stations & Bus Stops have EVERYTHING to do with speed! Did you see: Muni floats plan to pull hundreds of S.F. stops

Really?
So the VTA 522 Rapid is slowed down by the existence of a bus stop on a curb? Did not notice that at all! Better go out and remove all those sign posts along El Camino Real for Route 22. That will definitely make the 522 go faster.

Update 2:

that bus is the transit agency’s version of BRT.
Not only have they eliminated stops (one mile length between most stop), it doesn’t even have a schedule after it leaves its origin at set time, meaning it doesn’t have to ‘wait’….

Amtrak buses doing something similar – on many runs, they will only stop if a passenger gets off, but not to pick up.

I think it important to recognize the differences between bus types – local, inter-city, BRT, and train types: commuter rail, heavy rail, LRT….speed is always an important factor – to some types more than others. Intercity trains are expected to go faster than commuter rail; commuter rail faster than heavy rail (though there can be express and local subway lines, of course), all both faster than LRT.

Can you imagine a ’smoke break’ for HSR???

And ?

Once again — how is the *existence* of a bus stop going to affect a bus’s schedule if the bus doesn’t stop at the stop?

How is the existence of a train station going to affect a given train’s speed and schedule if the train doesn’t stop?

I am completely baffled.

I am completely astonished that the NYC subway routes are impacted by stations where the train doesn’t stop.

I really do not understand how the “6-express” subway runs slower because of the existence of the “Elder Ave” stop ( which the 6-Express skips ). Perhaps someone else can help explain this?

I have no idea what a “smoke stop” has to do with station planning. Maybe you can enlighten me?

Update 3 [ 15 June 2009 23:13:00 ]:

An intelligent question from twitter:

Is there a (federal) law requiring trains to slow below a certain speed in stations irrespective of stopping?

No Federal Law. A train can go through at whatever speed it wants to. Certainly, some sort of warning system may desirable. The only exception is “holdout” stations. Holdout stations are stations where passengers cross active tracks to board. California Ave USED in Palo Alto, Ca to be holdout station.

Posted in environment, high-speed-rail, political, random silliness, rants, transportation | 2 Comments »

VCs: stop the false dichotomies

Wednesday, May 27th, 2009

What is with VCs and their false dichotomy when giving feedback about a company asking for funding:

  • Say nothing about the team
  • Be an asshole about how worthless the team is and their mothers should have had an abortion.

VCs seem to be a sound system with two settings for volume: “mute” or “max (a-hole)”. We live in an analog world. Lets try a little moderation.

How about this VCs? If you perceive the problem as the team, give feedback that is:

  • specific
  • actionable
  • non-personal (not impersonal)

Example dialog:

VC:

I like the concept. However, I don’t have confidence that the team as it exists can execute successful. My reasons are because:

  1. executing requires a deeper knowledge of neurosurgery. I need founders or a board of advisers with this expertise
  2. the team seems to be overweighted with business-types and underweighted in technology
  3. in order to sell into the companies you are targeting you will need a C-level person with the needed credibility
  4. you were disorganized for this meeting which makes me question your ability to manage a company.

If these barriers change, we may be interested in this company.

Possible response from the entrepreneur:

Thank you for this feedback.

  1. We have felt that is gap in neurosurgery is not as significant as you apparently do because we have 20 surgeons in other specialities. Perhaps if we refocused our product away from the neurosurgery aspects, it would be a better match to our skills? Perhaps you have some suggestion about who we should approach?
  2. We agree. Joe and Paul are helping us get started but they plan on returning to school once their time is no longer needed. Currently we are using all the help we can get.
  3. Perhaps. Right now, we have not yet found that person. My goal is to grow with the company. I have discussed this with the team. The agreement we have is that if I cannot get 1 customer within 6 months, the CEO role will be transitioned to another. Currently we are actively looking for advisers and a COO person that could act as a potential replacement support for me. However, who could imagine that Bill Gates or Mark Zuckerburg could manage the responsibilities that they now have?
  4. Thank you for that feedback. I did not realize that I gave that impression. If you talk to the rest of the team I think you would find that their opinion is different. Would be willing to do that?

Notice that the entrepreneur is not just agreeing with the VC. And the VC may be unsatisfied with the entrepreneur’s response. The VC may not wish to proceed further no matter what. But at least the feedback is out there in a cordial matter.

Posted in amplafi, rants, starting a company | No Comments »

Stop the privatization of social safety net!

Wednesday, May 27th, 2009

Can we stop the bleeding heart liberal who sees the symptom but the wrong solution?

Problem:

In the Great Depression unemployment in the U.S. peaked at 24.9% in 1933. Imperial County today has an unemployment rate of 26.9% closely followed by counties like Merced and Yuba at 18% – you can see the sobering Central Valley stats here and a map of California’s unemployment rate by county here.

Solution??:

When you are approached by a friend to give to the non-profits trying to help please give.

NO!

It is time to stop with the privatization of the social safety net.

When approached by that friend, demand as a condition of giving that *both* you and that friend write to your congress critter.

Demand that health care reform be passed. ( See earlier post )

Demand that unemployment benefits be modified so that the newly employed who are now newly unemployed are covered. Right now you have to be employed for a majority of the past 18 months to get any benefits.

Demand that the Employee Free Choice Act be passed. (EFCA makes it easier for employees to for unions, and stops companies from retaliating against employees.)

Stop buying into the idea that a few pennies thrown into a bucket will somehow replace a legitimate social safety net provided by the government.

Posted in political, rants | No Comments »

Email/Calendar : Missing features

Sunday, May 17th, 2009

Continuing my “broken” series of things that everyone uses but no one fixes. Many of these missing features are email and calendar integration.

Email. Much maligned. These are the key “broken”/ missing features. For some reason, not one major email provider nor any mail program ( that I know of ) has provided these missing features. Without these features, email is “broken”.

This list is in ranked preference.

  1. Easy calendar linking
  2. Deadline handling
  3. Delayed processing
  4. Notes
  5. Emphasis
  6. Quote management
  7. Cross linking
  8. Task integration
  9. Countdown

Easy calendar linking

Gmail makes a half-ass attempt at this but it has never worked for me.

Furthermore it looks like Gmail is only expecting 1 event per message. Most email newsletters have multiple events announced.

Properly done, this feature would allow users to select from the email body:

  • date/time information
  • location information
  • registration urls
  • deadline (early bird for example)

A floating, AJAX-y div that would allow users to select each bit of information separately until all needed information has been submitted.

Furthermore, the user should be able to create multiple events from a single email.

All created events are linked to the original email.

Deadline handling

This would support GTD methodology. An email comes in referencing an event (see above) or a request (“I need the financials by Thursday for the Friday morning C-level meeting” ). The recipient does not want to act on this request right away but they certainly don’t want to forget either.

Deadline handling makes sure the deadline is not forgotten and the email is removed (optionally) from the visible inbox( Inbox is distracting, “did I open this email .. oh yeah I did”).

With deadline handling, the user selects a series of dates that would trigger reminder notes to the user as the deadline approaches. The user also may create a task that indicates how much time the task will take. The deadline reminders would be increasingly color-coded based on how much time remains from the end of the task to the calendar item (“green”, “yellow”, “red” ).

Using the request example,

I need the financials by Thursday for the Friday morning C-level meeting

The user would create a deadline for Thursday 5pm. The task will take 2 hours and the user wants alarms on Thursday. The “red” alarm would be at 3pm on Thursday ( because the financials take 2 hours and must be done by 5pm ).

The email would then be archived so it is not there to distract the user. And the user will not accidentally forget the request because it got buried in the inbox.

Since one email may contain multiple requests, this feature would need to support multiple requests.

Delayed processing

This extends deadline processing to some degree, but is used more for the “softer” deadlines. Many messages have an implicit “sell-by” date. For example, emails about organizing or announcing an event. Once the event has happened, the back-and-forth messages can be deleted/archived. But until the event happens the messages should not be touched.

This allows easy handling of messages where the user doesn’t want to instantly delete the message but wants the message gone after a delay.

This feature would be immensely valuable to me personally. My inbox is cluttered with email chains planning events in 2004. Being able to attach a self-destruct would clean over 50% of my email.

[enhancement: if I don't open this email again in the next 30 days, delete it - kind of like spam processing for non-spam messages.]

Notes

What it says. I want to be able to attach a private note to an email. If I forward or reply to the email, the note is not included.

Some use cases: The email results in a phone conversation or chat. I want to be able to attach the phone notes or chat log to the email.

Why is this missing???

Emphasis

A big email, with lots of “stuff” that is not important. But one set of information that I do care about. I want to be able to select that text for special emphasis. Conversely, I want to selectively diminish other parts of the email.

This would allow the important data to easily be re-found and for unimportant parts to be collapse from view.

Quote management

In a long email back and forth, I want to be able to collapse levels of the quoted previous messages in the thread.

Cross linking

2+ emails are related (for me) I want to connect two messages with no obvious connection. These messages are not in teh same email thread and have no obvious computable connection. Different senders, different email threads but the content happens to be related.

Task integration

A bunch of messages are all related to a certain task. Allow the user to connect those emails to a task. When the task is completed, the messages are archived (or deleted). Since a single email may relate to multiple tasks, the email is only deleted/archived when all the tasks have been completed.

The text corresponding to completed tasks is “deemphasized” ( see “Emphasis” missing feature )

Countdown

Reminders are transitory alarms. For some reminders, a countdown clock to the event is better.
This avoids the need to set multiple reminder alarms.
This wouldn’t work for SMS reminders but would work if it was part of the calendar / email display.

Posted in broken, rants, starting a company | No Comments »

Ad networks: missing features

Saturday, May 16th, 2009

Ad networks missing features:

  1. Interconnection with bookmarking services
  2. Browser back button support
  3. Rich interaction
  4. Selective Memory
  5. Show different video ads
  6. Limit the ad selection

Interconnection with bookmarking services

You’ve interrupted me. The ad is interesting. Well-targeted. Good job. I am interested. But not right now. Right now I want to finish reading page 2 of this article.

Why are you demanding that I follow the ad link now? Interact with delicious.com, xmarks.com or simply my browser bookmark ability. Let me bookmark the ad link as a private bookmark for later. Bookmarking services have simple APIs. Spend the 13 seconds. Do the integration.

In the “old” print advertising medium. A prospect could tear out the ad from the magazine or newspaper for later. Why can’t the “new” media do this?

Browser back button support

You wanted to sell to me. I am ignoring your ad. I click on a link, not your ad. I then notice your ad. Mission accomplished…. too late. The page refreshes. The ad is gone.

I click the browser back button. The browser shows the previous page.

Except for the ad I wanted to read. Your ad. No clicks for you!

In the “old” print medium, the ad on page A3 does not change and disappear just because I have flipped the page. I can go back to not just the article, but to the ads!

Rich interaction

Hat-tip to meebo.com for breaking the old model. But for everyone else, why is the only interaction with the ad, a link?

  • If the ad is related to an event? Make it so someone can put the event on their calendar. Generate the ical file
  • provide sales contact information as a vcard that reminds the user of when and where they saw the ad. Maybe even a link to the ad itself!
  • Add the ability to email /forward the ad!

Get creative with the interaction!

In the “old” print medium, ads have a phone number and a physical address. How is this any different than a link?

Selective Memory

Consumers know that ad networks track them. Acknowledge this. Let the consumers edit your memory. The user’s only alternative is deleting cookies so the ad network know nothing. Allowing consumers a choice, gives the ad networks a chance remember something.

In old print media, there is an advertisers index on the magazine back cover. How come websites don’t have the same functionality? Maybe not all advertisers, only the premium advertisers get listed in the advertisers index.

Show different video ads

For christ’s sakes guys, how come consumers have to suffer from watching the same pre-roll 10 second ad repeatedly. I hate CNN, FOX, etc. Every 5 video clips I get shown the same pre-roll ad for the same product. My ears bleed. Even if I am interested in watching more videos, I run away! Fast!

Limit the ad selection

It is well known that it takes multiple impressions to reach the consumer. For the time the visitor is on a website, increase the number of ad impressions. Make it so that a visitor sees the IBM ads 8 times rather than showing 8 different ads for 8 different companies.

Hopefully someone like Frank will do something about this!

Posted in amplafi, broken, marketing, rants, starting a company | No Comments »

New media same as the old when it comes to getting facts wrong

Friday, March 27th, 2009

Once again “new” media reporters on blogs has proven no better at getting facts right than “old” media reporters.

Mike Arrington over at TechCrunch gets a cheap laugh at a proposal to “ban black cars” by the California Air Resources Board.

Of course the vast majority of the comments piled on with silly comments about the “left coast” and “nutty environmentalists”, but apparently no one bothered to actually read the proposal or understand the problem.

Except that isn’t at all what the proposal actually is.

Briefly, dark colors absorb heat. And take a long time to radiate. Go down to LA in July some time. 95+ degrees. In stop and go traffic, without an airconditioner, the car will never cool off.

And if anybody bothered to actually read the presentation it says:

data indicates 20-25%
more likely achievable range for dark
colors for automobiles ( page 8 )

By 2016, all colors must meet the 20%
reflectivity requirement” (page 9)

And the benefits are:

Reduced interior temperatures can reduce a/c capacity and likelihood of a/c use
Smaller a/c or less operation results in less
fuel used ( page 4 )

So in other words, by 2016 the paints must meet a reflectivity standard that is *less* than what is possible for dark colors (except for jet black). If a Jet Black paint can meet the standards, the paint is o.k.

So ARB made sure to set an achievable goal that would not “ban” a color. But Mike needs his cheap shot and nothing was going to stand in his way.

Posted in environment, political, random silliness, rants | No Comments »

Cry me a river

Thursday, March 26th, 2009

[Crossposted from my comments over on Fred Wilson's blog]

Sorry Fred — “Financial McCarthyism” ?

McCarthyism was tarring the innocent with innuendo to ruin the accused lives.

What is happening now is anything but. AIG, Merrill Lynch, Bank Of America, et.al. are NOT innocent victims. They are the perpetrators of the biggest heist of all time.

These financial “wizards” have demonstrated that the only financial knowledge and ethics they have is that of a swindler.

This is a perp walk for a reason. They are the criminals – not victims.

Read Jack deSantis’s sob letter. My answer is …. so?

AIG is bankrupt. At a bankrupt firm, bonuses aren’t paid, contracts are torn up – usually by bankruptcy court. Look at the UAW, GM, GM’s creditors, and bondholders – pennies on the dollar for them.

AIG should be in receivership. Instead, we the sheeple taxpayers, *paid* for the privilege of declaring AIG bankrupt. Instead of dumping billions down the AIG rathole in the first place, AIG should have just been seized like a bank in a similar situation would have been.

My wife and I both at various times were promised bonuses at startups that went through an asset sale and shutdown. Not always were those bonuses delivered. Should we have have been able to write such a letter to the NYT.

Some more points:

  1. The letter writer (Jack) claims he had nothing to do with CDS. How do we know? Was he in meetings when the issue was brought up and went along with/and or encouraged CDS? We only have his word on this.
  2. How do we know that his work didn’t “blow up” in later years? Only his word on it.
  3. “$742,006.40, after taxes”. As a bonus. In a bankrupt firm. “$1″ annual salary. Show me many people who could take that kind of salary cut. My wife who is a tax accountant has some people coming in with $300K+ in W-2 wages crying about how much taxes they have to pay. A client who makes more in tax-free California muni’s than my wife and I have all year. I am sorry, cry me a river. The *average* income for a family of 4 in the San Francisco Bay Area is about $85,000. Cry me a river.
  4. Jack claims to have suffered as a result of the economic downturn. Oh really? Is Jack being foreclosed on? Are his kids having to pass up on dreams of going to college? Is Jack looking at his medication and deciding which prescription he isn’t going to renew? Or maybe its powdered milk this month, or a trip to Second Harvest. Are creditors calling him? Considering that Jack’s firm helped with the 2005 bankruptcy law re-write, that helped result in so many foreclosures — cry me a river.
  5. When deciding to hold out for the bonus, he should have factored in the possibility that AIG wouldn’t be able to pay up on the promises. Are GM and Chrysler execs writing such letters? Probably not. Would a UAW member looking at a slashed pension get the same sympathy?

Once again, Jack is not an innocent victim. Jack may not be a criminal. No one is talking jail for Jack (yet). But Jack just learned a hard lesson in not-counting-chickens-before-they-are-hatched, and he is “upset”. I bet half the country would switch places with Jack and not be upset at all. Maybe Jack needs to step back, clear his head, and go work at a homeless shelter for some time to get a proper perspective.

Final question — how come is it that people like Jack who don’t actually make anything, who don’t actually increase the value of the world are so highly compensated? Jack is just a fancy pants banker. Fred, you as a VC add value. You help create companies and bring new ideas to fruition. My wife makes sure that her companies spend their money wisely. I am building a company, Amplafi. What did Jack and his ilk build or create? Near as I can figure, they built a fancy casino.

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FAS157: VCs whining about what they have to do anyhow

Monday, February 2nd, 2009

So over at Techdirt, Mike Masnick gets all whiny about having to follow government regulations:

And, now, FAS 157 has come into play — a new rule impacting many venture capitalists, forcing them to figure out what the “fair market value” of their investments are, and provide that number to their investors. The problem is that these things are impossible to accurately value. Not difficult, but impossible. You’re asking people to value a totally illiquid asset as if it were liquid.

I am sorry but this smells like bullsh*t. Mike claims it is impossible to value a totally illiquid asset.

For arguments sake, lets think of some totally illiquid assets that get valued all the time in the courts:

  • A person’s sight (lost in an industrial accident)
  • Cancer caused by exposure to a TCE leaching into the water supply
  • A person’s life

The fact is that we figure out how to assign a value to “illiquid” assets all the time.

Mike links to Fred Wilson’s blog post which Mike offers up as “proof” that VCs are complaining about FAS157. However, Fred gives a fairly clear explanation of how his firm tries to value each company, including areas where there is a little bit of black magic. Fred ends his post:

There’s a silver lining in all of this, including the IRS 409a pronouncement of a few years ago that has created a whole industry of private company valuation firms and, if anything, even lower stock option grant prices, and that is that we are starting to collect a huge data set of private company valuations over time.

This, combined with the efforts of a few brave souls to create secondary markets for private company stock is going to lead to more data, more transparency, and more liquidity without having to register and do an IPO or sell your company.

Now I may be insane but Fred doesn’t sound like someone who cannot arrive at any valuation.

Now lets shoot some more holes in Mike’s “theory”. He says that he can possibly value any portfolio companies at any time. This means that, if Mike was to be a member of 5-partner VC firm, his firm could NOT:

  • pick the weakest companies that get cut-off (if Mike cannot value a company at all then he can’t value it against another company either)
  • decide which partner is doing better and which partner is picking poorly (can’t value, means can’t value partner performance either)
  • explain to a limited partner how well the fund is doing (“We can’t value our portfolio companies….” “WTF???” )
  • make a decision if the next round should be an up or downround
  • figure out if they got a great deal or if the founders got a great deal

Sorry…. BULLSHIT

Posted in funding, management, rants | No Comments »