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Why We Should Not Take Silicon Valley Practices As Law

In trying to borrow good practices we might end taking on something less desirable along the way

20Dec

Silicon Valley became a synonym for innovation, growth, and unicorn startups growing into huge corporations that take on the world. Public opinion has been fond of its independent, daring spirit and seeming meritocracy. A place where they listened to the crazy ideas of young gifted geniuses that built empires but care less about gain than about changing the world for the better.

Companies representing the Valley set standards for the tech industry and the rest of the world when it comes to ambitious goals, both in the way they run business and their corporate culture. We are so used to seeing it as a perfect example and a source of valuable insights that we might unwittingly borrow something less desirable.

Words, words, words

Public sentiment towards tech giants has however changed dramatically over the past few years. They used to be seen as saviors, successfully convincing everyone that their primary goal was to solve global problems and help humanity.

'We believe that a more open world is a better world because people with more information can make better decisions and have a greater impact.' This quote is from Mark Zuckerberg's 2012 manifesto 'Why Facebook exists'. He claimed back then to have created a tool for 'a more honest and transparent dialogue around government', that would result in 'better solutions to some of the biggest problems of our time.'

One cannot help but notice how poignantly ironic all this sounds in the light of the 2016 US election scandals. Allegations were made about Facebook aggregating user data for targeted ads and news and enabling third parties to manipulate the results. This discouraged certain demographic groups of voters from participating and leveraged the opinion of the hesitant in their own favor. Taking all this into account, doesn’t it look like Facebook failed to live up to its purpose?

Of course, one can argue that in creating something as huge as Facebook, one cannot be held responsible for all the abuse committed by the tool. Still, for a company that employs more than 20,000 people and has a quarter of the world’s population for users, such unawareness seems at the very least, incompetent. After all, if you created and maintain it, you should probably know its weak points and be able to predict the abuse and prevent it.

The worst notion, however, is that they do not really care. When it comes to targeted ads, for instance, ProPublica recently discovered that Facebook allowed advertisers to target users who described themselves as 'Jew-haters.' The platform did not question whether the idea was inappropriate; it just asked how the customer would like to pay. That clearly undermines the 'Frankenstein's monster' argument. To quote Ross Baird, president of the venture capital firm Village Capital, 'For all the lip service that Silicon Valley has given to changing the world, its ultimate focus has been on what it can monetize'.

Monetization and manipulation cause disruption of tech giants. We can argue whether all that follows is their fault, but it is undoubtedly their mistake. People all over the world are realizing that technology is not neutral and possible profits are always involved.

But let us presume just for the sake of argument, that there are no 'fake news', misleading ads or lucrative targeted posts. There is still the massive problem of 'recommendation' algorithms, which create a safe digital bubble around users. As result, we only ever see what we want to see and we only read what we are likely to 'like'. This is dangerous because it distorts reality and is misleading.

That gives us all a lot to think about. Is technology here to connect us or to create cozy individual cocoons isolating us from the rest of the world? Is it here to create tools to improve your life; connecting you with your friends, helping you to make better choices? Or is it there to create additional challenges; stir controversy, undermine privacy and, create smoke-and-mirrors realities?

Survivorship Bias

Why then do we keep seeing successful entrepreneurs and visionaries as gods? We entrust them with things they are neither competent nor willing to decide or execute.

They do a great job where they are, but it does not mean that in Silicon Valley they created some kind of Utopia where everything is handled in the best possible fashion. They are people, they are biased, they have blind spots, they have stereotypes and they sometimes make mistakes by acting on them.

All this is enough to begin thinking critically about the 'best practices' of the Valley. But does it also mean we must start to question their entrepreneurial prowess and other skills?

The inhabitants of this Arcady have a weak spot even when it comes to startups and businesses as well. This weakness is the survivorship bias. In essence, it is a logical error we all prone to. We concentrate on people or things that make it past a selection process and overlook those that did not. Unsuccessful startups that did not make it – they become invisible. Therefore, we do not learn from their mistakes. however, their failures may not even be due to mistakes. It is possible they did everything right, they just didn't have that pinch of fairy dust called 'luck'.

Focusing on the survivors can result in a false, or incorrect, estimate of probability. This bias was famously addressed by statistician Abraham Wald to protect fighter planes during the World War II. It has since been responsible for celebrity idolization, the perception of market performance and, international calculations of the average lifespan.

What can we learn from the success of great companies like Google or Apple? They do not necessarily have a 'secret' or tips and tricks you can emulate to repeat their rise to glory. Their decisions might be dumb decisions that only seem brilliant because they worked out one time, for them. Should everyone follow the steps of Steve Jobs? Drop out of college and start a business with our friends in the garage of our parents' home? According to figures from regular National Venture Capital Association report, for every wealthy start-up founder, there are 100 other entrepreneurs who routinely end up with nothing more than a cluttered garage.

Silicon Valley and its advice business is a monopoly run by survivors, so you can only get a half of the equation from their insight. For the other half, you should check the startup graveyard.

…And More Bias

If we are so prone to copying the famous and successful, we might assume, looking at Uber, that sexist, discriminatory corporate culture, unscrupulous tactics and burning venture money are the keys to a successful business model. When clearly, they are not.

However, these well-publicized problems aren’t at all unique. They are typical to Silicon Valley’s bro culture. The fact that society blamed it all on Uber, and Uber blamed it all on Travis Kalanick is indicative. It is always easier to find a scapegoat to quiet one’s conscience than to look for the bias inside one’s self.

I am not saying we renounced the experiences and best practices of Silicon Valley entirely and only follow our own winding path. I just wish we could be more critical and selective about the lessons we borrow.

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