12 ms·

Theranos and Zenefits are a feature, not a bug, of Silicon Valley

89 points by krausejj 9y ago

tlb 9y ago
I don't agree with the premise that some amount of deception is necessary to pitch a company. Founders should say both what they plan to do, and what they actually have working today. I think it's a partly a dysfunction of some investors, that they get excited by the plan and forget to drill into what actually works. Investors who consistently drill into the current situation aren't surprised when things are a little broken, because that's true of every startup.
- maerF0x0 9y ago
  Especially in the pitch, the value of a lie there is quite low and the long term costs of a mismatch are great.
- capkutay 9y ago
  and investors simultaneously kill competition by honest companies...'you have a 10 year roadmap to do X? not interesting. i'll invest $100m in this company that says they can do 10X in one year!'
  - twinkletwinkle 9y ago
    The market should correct that though. Those companies will (should) quickly run out of money to invest. While those who pick the ones with the right 10 year plan will (should) have the returns to continue investing.
    - mi100hael 9y ago
      What really happens is the company that over-sold their capabilities gets the $100M and then ends up not meeting their stated timeline but investors are already 9-figures deep so they just accept there were "unforeseen setbacks" and continue supporting the company rather than admit they were hoodwinked. Meanwhile, the realistic company that was passed over runs out of money and folds.
      - AndrewKemendo 9y ago
        This is exactly right and there are numerous examples of that.
      - RyanZAG 9y ago
        I think most startups understand this implicitly, and therefore most pitches are lies. Most of the rest of the comments are about "it doesn't have to be this way!", but it's almost an inescapable local max. The previous big breaks in technology were nearly always the 10X in 1 year types, but it's extremely hard to tell who is actually a 10X in 1 year because they are so extremely rare. Probably impossible, since more likely than not, the 10X is pure luck on the part of a competent 1X than any kind of real difference. So the sensible 10 years for 1X that will make you profit but not overwhelming profit don't get funded, so the 10 years for 1X have no choice but to lie and get the funding they need, and investors get stringed along with all their sunk costs because most of the time that 1X payout is still a lot more than their sunk costs.
    - capkutay 9y ago
      companies with lots of funding have a way about choking their more frugal competitors. they poach the top talent, they take up all the hype in the space, grab the top customers/partners first...
    - Certhas 9y ago
      > The market should correct that though. That's a hypothesis not well supported by data or theory. (e.g.: https://en.wikipedia.org/wiki/Market_failure https://en.wikipedia.org/wiki/Market_failure )
      - heavenlyblue 9y ago
        By the time an efficient market corrects for these errors we will all die due to the heat death of the universe.
- jonmc12 9y ago
  Here's the dynamic I've observed as an entrepreneur. On average, investors don't make scientific decisions. Pitches are the input data to these decisions; on average, entrepreneurs who raise capital efficiently optimize for the fitness functions that close deals. Good pitch advice comes in the form: "play the game", "don't be so literal", etc. On the other hand, average investor feedback does not create a learning opportunity for entrepreneurs who are pitching. Smile f-ing, and backdoor calls to other investors is the language of pitch feedback. It creates a dichotomy where many entrepreneurs feel everyone else is embellishing and investors can't give feedback with candor in any case. Therefor, an internal narrative comes to life that its rational, and even in shareholder's best interest, ie, a duty of a CEO, to stretch the truth in a way that gets the company the resources it needs.
pinewurst 9y ago
It's unfair I think, to group Theranos - a total lie and fraud - with Zenefits, offering a useful service but cutting corners illegally.
- jacquesm 9y ago
  I think it is perfectly fair to group corporate criminals together.
  - harryh 9y ago
    Yesterday I jaywalked across a street. Most people wouldn't put me in the same group as Charles Manson. Grouping drastically difference offenses in the same bucket obscures reality instead of making it more clear.
    - jacquesm 9y ago
      No, and 'most people' would not put Zenefits into the same bracket as a company that filed a VAT statement two days late either. Zenefits is closer to Theranos on that scale (and closer to Uber and a couple of other entities that seem to enjoy breaking the law and letting others pick up the fall-out). The fact that Zenefits survived as a company is remarkable, but it makes their intentional deceit and fraud no less.
      - rdl 9y ago
        I don't think the bad things Zenefits did were essential to their success. Those exams just aren't that hard; it would have cost them thousands of dollars per person (in time/wages) to run people through them the correct way.
        jacquesm 9y ago
        The fact that they were both stupid and breaking the law doesn't make it better in my book.
maerF0x0 9y ago
"The only problem with an honest buck is they're so hard to make - the margins are too low, too many people are doin' it." -- Yuri Orlov , 'Lord of war' http://www.imdb.com/title/tt0399295/quotes/qt04033055 http://www.imdb.com/title/tt0399295/quotes/qt04033055 There will always be unethical people willing to exploit the commons for their own profit. Some will do so spectacularly, as a society it's our job to ensure that the EROI of such actions are < 1x so that they will lose out in the long run. Elizabeth Holmes was thoroughly unethical and will spend the next decade paying for that choice, I doubt she profited from it.
yalogin 9y ago
Theranos is a ponzi scheme right? I can see that they scammed investors by using Silicon valley techniques, but Zenefits seems like just a poorly run company just like any other one. On that front, why is no one at Theranos jailed and why is that company still operating?
- iamjaredwalters 9y ago
  Fraud charges were brought to the founder and the president recently. If I recall correctly a settlement was reached although I don't recall the specifics.
- bertjk 9y ago
  Not every fraud is a ponzi scheme. Ponzis are a specific kind of fraud where existing investors are paid dividends using investment funds from new investors. I haven't heard that existing Theranos investors ever got payouts.
  - confiscate 9y ago
    good comment. Most folks think in terms of absolutes, like "good vs bad", "right vs wrong", "steve jobs", "freedom", "jail", "fraud", "ponzi scheme", "criminals", and don't care about the details. People are easily misled by labels, like "Little Marco" or "Lyin' Ted" or "Crooked Hillary" All of a sudden people are calling Theranos a ponzi scheme when it's doing something completely different.
- godzillabrennus 9y ago
  The CTO committed suicide. The CEO took a deal where they will be paying a fine and will not run a company for 10 years. The President is fighting the charges.
peterbraden 9y ago
Lack of ethics is a feature? Ambition shouldn't come at all costs.
hprotagonist 9y ago
This is why medtech has the FDA, and why the FDA has actual teeth. "move fast and break stuff" is bad PR if you're facebook. It's a game-over felony if you're making medical devices.
- ng12 9y ago
  The FDA is necessary but I do think it could stand to adopt a little bit of the Silicon Valley ethos. Good example: the Freestyle Libre CGM is a recently approved glucose monitor for diabetics. The European version lasts 14 days and takes an hour to start up, the US version lasts 10 days and has a 12 hour (!) startup time. It's the exact same hardware with artificial restrictions added to the software for unclear reasons.
  - tomca32 9y ago
    12 hour startup time? Wow, that's crazy. Any idea on the reasoning behind the startup delay? I understand the reasoning for disabling it after 10 days, dexcom does the same, but I can't find any reasoning for delaying startup. I'm in the US and my Dexcom takes 2 hours to startup, and that's really only because of the sensor temperature adjustment, otherwise it's pretty much instantaneous.
    - ng12 9y ago
      I was able to find this online: > In the US, FreeStyle Libre’s accuracy has improved a bit with these changes – the average measurement error relative to a reference value is 9.7%, an improvement from around 11% in Europe (and on par with 9.0% for Dexcom’s G5). (https://diatribe.org/abbotts-freestyle-libre-approved-us-replace-routine-fingersticks#warm-up%20time https://diatribe.org/abbotts-freestyle-libre-approved-us-rep...) Which is absolutely ridiculous. 12 hours without a CGM is much, much more dangerous than a 1.3% margin of error.
      - lambda 9y ago
        A 1.3% margin of error is the difference over the entire time of wearing it. It looks like on the first day, comparing blood glucose with FreeStyle Libre CGM, there was a significant difference in accuracy, with a lot more (~20% more) readings falling into "zone B", or "points that are outside of 20% but would not lead to inappropriate treatment" (chart https://www.liebertpub.com/action/showImage?doi=10.1089%2Fdia.2014.0378&iName=master.img-002.jpg&w=237&h=205 https://www.liebertpub.com/action/showImage?doi=10.1089%2Fdi..., from paper https://www.liebertpub.com/doi/pdfplus/10.1089/dia.2014.0378 https://www.liebertpub.com/doi/pdfplus/10.1089/dia.2014.0378). This is just one quick thing I found on Google Scholar. Given that this CGM can also act as a regular fingerprick blood glucose monitor during that 12 hour overlap, I think the FDA likely wanted to err on the safer side of using well known and well tested methods for monitoring to avoid any unexpected issues. Is there sufficient evidence of the benefit of CGM over fingerprick tests to believe that this caution could cause actual harm?
deleted 9y ago
[deleted]
walshemj 9y ago
There are fraudulent / bad actors in all industries the commodities industry has an entire sector whos job it is to prove that that shipment of grain, sugar etc is actually valid.
- portofcall 9y ago
  The difference in Silicon Valley is that the shipments go out and there’s nobody checking. It’s a big fucking difference too.
vannevar 9y ago
Venture capital is much more of a Ponzi scheme than the community cares to admit. For every spectacular case like Theranos, how many cases are there where early investors at the top of the pyramid are able to take money off the table at the expense of later investors who never make it back? Technically, the company may still be viable, and might be acquired for some fraction of the total invested. But the mechanism that the VCs leveraged for their profit still resembles a classic pyramid scheme, where it is money from later investors ("the greater fool") that lines their pockets, and not profits from a successful business.
- scribu 9y ago
  Could you give some specific examples where a startup was sold at a loss and some of the investors actually got out more money than they put in? I know that when a public company goes bankrupt, the investors with preferred stock can, at best, get back all their money, but they can't make a profit.
  - lovich 9y ago
    VCs can invest money with garunteed payments greater than 1x. It doesn't mean that if the company sells for less than their investment they'll get their money back, but if they put in 1x and are garunteed 2x and first in line to get paid, when the company gets sold for 3x the VC gets their 2x and all the other investors/employees get to pull from the leftovers
- mikekij 9y ago
  I think you're referring to liquidation preferences, which actually make VC investments the opposite of a pyramid scheme, in which the latest investors get their money back first, at the expense of the earliest investors. (Those earliest investors are frequently the entrepreneur's grandmother.)
ssahoo 9y ago
Bad apples are everywhere. It will be poor judgement to prejudice with these limited facts. Business war is everywhere, some entrepreneurs are taking it just too far in pressure to pursue the baseless goals.
portofcall 9y ago
This is what you get with no oversight, tons of money, s lot of arrogance, and a focus on “hustle” over anything else. It definitely works for a while, but when it comes crashing down it’s going to take out a lot of innocent players with it.
dgreensp 9y ago
Just because “exuberance and fraud” are bound to happen doesn’t mean they are a good thing. I also don’t buy the skippery slope between pitching your vision and lying about the facts. Theranos clearly crossed the line, demonstrating that the line is sometimes clear. An article arguing that the line is sometimes blurry, or that deception can be a good thing, should draw on different material. If Silicon Valley as a whole is a bit scammy, it doesn’t serve us to defend it on that score or spin it into a positive.
pkaye 9y ago
In the case of Theranos, the investors should get domain experts as consultants when they invest.
- magnetic 9y ago
  Isn't that simply called (investment) diligence, and unrelated to Theranos?
castle-bravo 9y ago
Canadian engineering culture is a little different from American engineering culture. In Canada, you can't legally call yourself an engineer unless you are certified as such by a professional association. All students graduating from engineering programs are given an "Iron Ring" (stainless steel) to wear on the little finger of the working hand. The steel in the ring symbolizes the steel in a fallen bridge. The message is simple: if you fuck up, people can die. This extends to purely financial matters too; if you waste 2M of capital, you've wasted the productivity of an average person's life (average in Canada and the US). If you lie to people to get your hands on their money and misrepresent your work, you shouldn't be lionized as some kind of entrepreneuring maverick; you're a danger to the public interest. This is worse than making a calculation error that results in harm; it is willful and deliberate harm at the scale of a mass murder.
- logiclion 9y ago
  The US has a similar ceremony. However, the engineers are nominated.
- EnFinlay 9y ago
  Definitely a pet peeve that so many software developers call themselves software engineers. I went to engineering school in Canada, and no longer wear my ring because the work I do is not engineering, it's development. I'm not trying to knock the software development profession, I have a lot of respect for and derive a lot of joy from the work. There's just a difference between "As a member of this association of professionals, I declare this a safe and appropriate design, and am personally and professionally liable for failures in this design" and "I have push access to master and can deploy code to prod".
  - bm1362 9y ago
    On the other side, do we want to treat every project like a medical device? In the vast majority of sane engineering orgs there isn’t gross negligence and developers are very cautious (hence the popular evil PM / incompetent manager trope) to the point that they barely move at all.
Kream 9y ago
In my understanding, there is a clear issue here with the understanding and separation between the present, which is a fact and the future, which is a theory. It is illegal to misrepresent your financial statements, thus lying about the present. But you can sell whatever you want about your future, like changing the world and making it a better place and what have you. The Silicon Valley feature is the unbelievable faith in the potential of an idea/startup. I don't think lying about your current financials or KPIs is a feature.
WheelsAtLarge 9y ago
The article makes a good point. Exaggeration is common when trying to raise money. Read the history of many startups and you'll find outright lies that seem mild after the fact since the startup was able to continue and deliver. We've all heard the stories as well as all the people that invest in startups.

89 points by krausejj 9y ago

tlb 9y ago

I don't agree with the premise that some amount of deception is necessary to pitch a company. Founders should say both what they plan to do, and what they actually have working today. I think it's a partly a dysfunction of some investors, that they get excited by the plan and forget to drill into what actually works. Investors who consistently drill into the current situation aren't surprised when things are a little broken, because that's true of every startup.

maerF0x0 9y ago
Especially in the pitch, the value of a lie there is quite low and the long term costs of a mismatch are great.
capkutay 9y ago
and investors simultaneously kill competition by honest companies...'you have a 10 year roadmap to do X? not interesting. i'll invest $100m in this company that says they can do 10X in one year!'
- twinkletwinkle 9y ago
  The market should correct that though. Those companies will (should) quickly run out of money to invest. While those who pick the ones with the right 10 year plan will (should) have the returns to continue investing.
  - mi100hael 9y ago
    What really happens is the company that over-sold their capabilities gets the $100M and then ends up not meeting their stated timeline but investors are already 9-figures deep so they just accept there were "unforeseen setbacks" and continue supporting the company rather than admit they were hoodwinked. Meanwhile, the realistic company that was passed over runs out of money and folds.
    - AndrewKemendo 9y ago
      This is exactly right and there are numerous examples of that.
    - RyanZAG 9y ago
      I think most startups understand this implicitly, and therefore most pitches are lies. Most of the rest of the comments are about "it doesn't have to be this way!", but it's almost an inescapable local max. The previous big breaks in technology were nearly always the 10X in 1 year types, but it's extremely hard to tell who is actually a 10X in 1 year because they are so extremely rare. Probably impossible, since more likely than not, the 10X is pure luck on the part of a competent 1X than any kind of real difference. So the sensible 10 years for 1X that will make you profit but not overwhelming profit don't get funded, so the 10 years for 1X have no choice but to lie and get the funding they need, and investors get stringed along with all their sunk costs because most of the time that 1X payout is still a lot more than their sunk costs.
  - capkutay 9y ago
    companies with lots of funding have a way about choking their more frugal competitors. they poach the top talent, they take up all the hype in the space, grab the top customers/partners first...
  - Certhas 9y ago
    > The market should correct that though. That's a hypothesis not well supported by data or theory. (e.g.: https://en.wikipedia.org/wiki/Market_failure https://en.wikipedia.org/wiki/Market_failure )
    - heavenlyblue 9y ago
      By the time an efficient market corrects for these errors we will all die due to the heat death of the universe.
jonmc12 9y ago
Here's the dynamic I've observed as an entrepreneur. On average, investors don't make scientific decisions. Pitches are the input data to these decisions; on average, entrepreneurs who raise capital efficiently optimize for the fitness functions that close deals. Good pitch advice comes in the form: "play the game", "don't be so literal", etc. On the other hand, average investor feedback does not create a learning opportunity for entrepreneurs who are pitching. Smile f-ing, and backdoor calls to other investors is the language of pitch feedback. It creates a dichotomy where many entrepreneurs feel everyone else is embellishing and investors can't give feedback with candor in any case. Therefor, an internal narrative comes to life that its rational, and even in shareholder's best interest, ie, a duty of a CEO, to stretch the truth in a way that gets the company the resources it needs.

pinewurst 9y ago

It's unfair I think, to group Theranos - a total lie and fraud - with Zenefits, offering a useful service but cutting corners illegally.

jacquesm 9y ago
I think it is perfectly fair to group corporate criminals together.
- harryh 9y ago
  Yesterday I jaywalked across a street. Most people wouldn't put me in the same group as Charles Manson. Grouping drastically difference offenses in the same bucket obscures reality instead of making it more clear.
  - jacquesm 9y ago
    No, and 'most people' would not put Zenefits into the same bracket as a company that filed a VAT statement two days late either. Zenefits is closer to Theranos on that scale (and closer to Uber and a couple of other entities that seem to enjoy breaking the law and letting others pick up the fall-out). The fact that Zenefits survived as a company is remarkable, but it makes their intentional deceit and fraud no less.
    - rdl 9y ago
      I don't think the bad things Zenefits did were essential to their success. Those exams just aren't that hard; it would have cost them thousands of dollars per person (in time/wages) to run people through them the correct way.
      - jacquesm 9y ago
        The fact that they were both stupid and breaking the law doesn't make it better in my book.

maerF0x0 9y ago

"The only problem with an honest buck is they're so hard to make - the margins are too low, too many people are doin' it." -- Yuri Orlov , 'Lord of war' http://www.imdb.com/title/tt0399295/quotes/qt04033055 http://www.imdb.com/title/tt0399295/quotes/qt04033055 There will always be unethical people willing to exploit the commons for their own profit. Some will do so spectacularly, as a society it's our job to ensure that the EROI of such actions are < 1x so that they will lose out in the long run. Elizabeth Holmes was thoroughly unethical and will spend the next decade paying for that choice, I doubt she profited from it.

yalogin 9y ago

Theranos is a ponzi scheme right? I can see that they scammed investors by using Silicon valley techniques, but Zenefits seems like just a poorly run company just like any other one. On that front, why is no one at Theranos jailed and why is that company still operating?

iamjaredwalters 9y ago
Fraud charges were brought to the founder and the president recently. If I recall correctly a settlement was reached although I don't recall the specifics.
bertjk 9y ago
Not every fraud is a ponzi scheme. Ponzis are a specific kind of fraud where existing investors are paid dividends using investment funds from new investors. I haven't heard that existing Theranos investors ever got payouts.
- confiscate 9y ago
  good comment. Most folks think in terms of absolutes, like "good vs bad", "right vs wrong", "steve jobs", "freedom", "jail", "fraud", "ponzi scheme", "criminals", and don't care about the details. People are easily misled by labels, like "Little Marco" or "Lyin' Ted" or "Crooked Hillary" All of a sudden people are calling Theranos a ponzi scheme when it's doing something completely different.
godzillabrennus 9y ago
The CTO committed suicide. The CEO took a deal where they will be paying a fine and will not run a company for 10 years. The President is fighting the charges.

peterbraden 9y ago

Lack of ethics is a feature? Ambition shouldn't come at all costs.

hprotagonist 9y ago

This is why medtech has the FDA, and why the FDA has actual teeth. "move fast and break stuff" is bad PR if you're facebook. It's a game-over felony if you're making medical devices.

ng12 9y ago
The FDA is necessary but I do think it could stand to adopt a little bit of the Silicon Valley ethos. Good example: the Freestyle Libre CGM is a recently approved glucose monitor for diabetics. The European version lasts 14 days and takes an hour to start up, the US version lasts 10 days and has a 12 hour (!) startup time. It's the exact same hardware with artificial restrictions added to the software for unclear reasons.
- tomca32 9y ago
  12 hour startup time? Wow, that's crazy. Any idea on the reasoning behind the startup delay? I understand the reasoning for disabling it after 10 days, dexcom does the same, but I can't find any reasoning for delaying startup. I'm in the US and my Dexcom takes 2 hours to startup, and that's really only because of the sensor temperature adjustment, otherwise it's pretty much instantaneous.
  - ng12 9y ago
    I was able to find this online: > In the US, FreeStyle Libre’s accuracy has improved a bit with these changes – the average measurement error relative to a reference value is 9.7%, an improvement from around 11% in Europe (and on par with 9.0% for Dexcom’s G5). (https://diatribe.org/abbotts-freestyle-libre-approved-us-replace-routine-fingersticks#warm-up%20time https://diatribe.org/abbotts-freestyle-libre-approved-us-rep...) Which is absolutely ridiculous. 12 hours without a CGM is much, much more dangerous than a 1.3% margin of error.
    - lambda 9y ago
      A 1.3% margin of error is the difference over the entire time of wearing it. It looks like on the first day, comparing blood glucose with FreeStyle Libre CGM, there was a significant difference in accuracy, with a lot more (~20% more) readings falling into "zone B", or "points that are outside of 20% but would not lead to inappropriate treatment" (chart https://www.liebertpub.com/action/showImage?doi=10.1089%2Fdia.2014.0378&iName=master.img-002.jpg&w=237&h=205 https://www.liebertpub.com/action/showImage?doi=10.1089%2Fdi..., from paper https://www.liebertpub.com/doi/pdfplus/10.1089/dia.2014.0378 https://www.liebertpub.com/doi/pdfplus/10.1089/dia.2014.0378). This is just one quick thing I found on Google Scholar. Given that this CGM can also act as a regular fingerprick blood glucose monitor during that 12 hour overlap, I think the FDA likely wanted to err on the safer side of using well known and well tested methods for monitoring to avoid any unexpected issues. Is there sufficient evidence of the benefit of CGM over fingerprick tests to believe that this caution could cause actual harm?

deleted 9y ago

[deleted]

walshemj 9y ago

There are fraudulent / bad actors in all industries the commodities industry has an entire sector whos job it is to prove that that shipment of grain, sugar etc is actually valid.

portofcall 9y ago
The difference in Silicon Valley is that the shipments go out and there’s nobody checking. It’s a big fucking difference too.

vannevar 9y ago

Venture capital is much more of a Ponzi scheme than the community cares to admit. For every spectacular case like Theranos, how many cases are there where early investors at the top of the pyramid are able to take money off the table at the expense of later investors who never make it back? Technically, the company may still be viable, and might be acquired for some fraction of the total invested. But the mechanism that the VCs leveraged for their profit still resembles a classic pyramid scheme, where it is money from later investors ("the greater fool") that lines their pockets, and not profits from a successful business.

scribu 9y ago
Could you give some specific examples where a startup was sold at a loss and some of the investors actually got out more money than they put in? I know that when a public company goes bankrupt, the investors with preferred stock can, at best, get back all their money, but they can't make a profit.
- lovich 9y ago
  VCs can invest money with garunteed payments greater than 1x. It doesn't mean that if the company sells for less than their investment they'll get their money back, but if they put in 1x and are garunteed 2x and first in line to get paid, when the company gets sold for 3x the VC gets their 2x and all the other investors/employees get to pull from the leftovers
mikekij 9y ago
I think you're referring to liquidation preferences, which actually make VC investments the opposite of a pyramid scheme, in which the latest investors get their money back first, at the expense of the earliest investors. (Those earliest investors are frequently the entrepreneur's grandmother.)

ssahoo 9y ago

Bad apples are everywhere. It will be poor judgement to prejudice with these limited facts. Business war is everywhere, some entrepreneurs are taking it just too far in pressure to pursue the baseless goals.

portofcall 9y ago

This is what you get with no oversight, tons of money, s lot of arrogance, and a focus on “hustle” over anything else. It definitely works for a while, but when it comes crashing down it’s going to take out a lot of innocent players with it.

dgreensp 9y ago

Just because “exuberance and fraud” are bound to happen doesn’t mean they are a good thing. I also don’t buy the skippery slope between pitching your vision and lying about the facts. Theranos clearly crossed the line, demonstrating that the line is sometimes clear. An article arguing that the line is sometimes blurry, or that deception can be a good thing, should draw on different material. If Silicon Valley as a whole is a bit scammy, it doesn’t serve us to defend it on that score or spin it into a positive.

pkaye 9y ago

In the case of Theranos, the investors should get domain experts as consultants when they invest.

magnetic 9y ago
Isn't that simply called (investment) diligence, and unrelated to Theranos?

castle-bravo 9y ago

Canadian engineering culture is a little different from American engineering culture. In Canada, you can't legally call yourself an engineer unless you are certified as such by a professional association. All students graduating from engineering programs are given an "Iron Ring" (stainless steel) to wear on the little finger of the working hand. The steel in the ring symbolizes the steel in a fallen bridge. The message is simple: if you fuck up, people can die. This extends to purely financial matters too; if you waste 2M of capital, you've wasted the productivity of an average person's life (average in Canada and the US). If you lie to people to get your hands on their money and misrepresent your work, you shouldn't be lionized as some kind of entrepreneuring maverick; you're a danger to the public interest. This is worse than making a calculation error that results in harm; it is willful and deliberate harm at the scale of a mass murder.

logiclion 9y ago
The US has a similar ceremony. However, the engineers are nominated.
EnFinlay 9y ago
Definitely a pet peeve that so many software developers call themselves software engineers. I went to engineering school in Canada, and no longer wear my ring because the work I do is not engineering, it's development. I'm not trying to knock the software development profession, I have a lot of respect for and derive a lot of joy from the work. There's just a difference between "As a member of this association of professionals, I declare this a safe and appropriate design, and am personally and professionally liable for failures in this design" and "I have push access to master and can deploy code to prod".
- bm1362 9y ago
  On the other side, do we want to treat every project like a medical device? In the vast majority of sane engineering orgs there isn’t gross negligence and developers are very cautious (hence the popular evil PM / incompetent manager trope) to the point that they barely move at all.

Kream 9y ago

In my understanding, there is a clear issue here with the understanding and separation between the present, which is a fact and the future, which is a theory. It is illegal to misrepresent your financial statements, thus lying about the present. But you can sell whatever you want about your future, like changing the world and making it a better place and what have you. The Silicon Valley feature is the unbelievable faith in the potential of an idea/startup. I don't think lying about your current financials or KPIs is a feature.

WheelsAtLarge 9y ago

The article makes a good point. Exaggeration is common when trying to raise money. Read the history of many startups and you'll find outright lies that seem mild after the fact since the startup was able to continue and deliver. We've all heard the stories as well as all the people that invest in startups.