The rise of the “successful” unsustainable company • Hacker News Board

Re: The rise of the “successful” unsustainable company

#111

Post by javajosh » Wed, Oct 24, 2012, 6:17 AM UTC

pg wrote: post #93

tptacek wrote: post #76

Earlier quoted context omitted.

I am with you on how misplaced the enmity towards --- well, at least Groupon. But there have been well-known public companies that did badly that were essentially scams, such as during the channel stuffing scandals of the late 1990's. So while I sympathize with your irritation at the "Groupon is a Ponzi scheme" meme, the last sentence of your comment is simply wrong; it's wrong directly (a counterexample would be San…

If anything that supposed counterexample supports my point that the accusations these people casually make in HN comment threads are so much more drastic than they realize that they're their own reductio ad absurdum. Running a public company that's a scam tends to entail criminal behavior. Especially nowadays.

It's interesting to me that api's vague attack on the leadership of certain companies is pushing your buttons - going so far as to call his comment 'drastic' and 'absurd'.

The key point here, I think, is to be very careful to distinguish between a failure to build sustainability, and willful maneuvering for maximum personal gain at the expense of sustainability. The former is a noble failure, the later is deeply unethical (if not illegal) and ne'er the twain shall meet!

Re: The rise of the “successful” unsustainable company

#112

Post by javajosh » Wed, Oct 24, 2012, 6:26 AM UTC

It does seem like a smart buyer would take into account the difficulties Bill Nguyen has had handing over companies to new owners and keeping them healthy. It's not necessarily malice, but something is going wrong. If a smart buyer sees it, then a smart investor is going to anticipate this, and perhaps be more cautious investing.

But we do not see this behavior, and hence the mild outrage of this post.

We gnash our teeth and tear our hair because of the irrationality of buyers and investors, because if only they were rational they'd invest in my idea, not his! :)

Re: The rise of the “successful” unsustainable company

#113

Post by wslh » Wed, Oct 24, 2012, 6:41 AM UTC

tptacek wrote: post #95

pg wrote: post #93

Earlier quoted context omitted.

If anything that supposed counterexample supports my point that the accusations these people casually make in HN comment threads are so much more drastic than they realize that they're their own reductio ad absurdum. Running a public company that's a scam tends to entail criminal behavior. Especially nowadays.

CA didn't start out as a deliberate scam, and continues to run today despite being essentially a scam for many years. The companies we're talking about today --- Groupon, Zynga --- don't have long enough track records as publicly traded entities for us to presume they're run in good faith; variants of the things that got Kumar sentenced probably aren't even crimes when they happen during mezzanine funding, when the p…

so, adding a painfulness metric is not a right when the incentives are huge.

Re: The rise of the “successful” unsustainable company

#114

Post by welebrity » Wed, Oct 24, 2012, 6:47 AM UTC

We are still in the verrrrry early days of the internet. Yes, now in 2012. There will be bigger online companies/assets/entities than there are today. Just wait & see. Every new industry has its "pitchmen", and an anxious horde of "brilliant investors" who chase the supposed money(see: suckers) like a gold rush. History has way too many examples. Nguyen charmed the greedy masses, and everyone enjoyed their rôle. Only time highlights the mistakes by the start-up, the VC, and the eventual buyer. Tuesday morning QB-ing at it's best. In Silicon Valley, there will still be Nguyen adVoCates lining up for the next company . . . Black & White?

Re: The rise of the “successful” unsustainable company

#115

Post by sirclueless » Wed, Oct 24, 2012, 7:01 AM UTC

staunch wrote: post #106

tptacek wrote: post #103

Earlier quoted context omitted.

As I noted above, this isn't really an argument. Sanjay Kumar made hundreds of millions of dollars from CA and could have left long before he was indicted having already ensured that none of his grandchildren would ever have to work a day in their lives.

If you think they're sticking around to make more money, then they must be trying to repair the company's stock price. Or you think they're still there out of a sense of pride or guilt. Either way it's not a pump and dump, and their goal is to turn the company around.

The only thing their continued presence at their respective companies tells us is that they think they can do better by staying than leaving. Mark Pincus might be staying at Zynga because he thinks he can turn around the stock price and make it a sustainable company, or he might be staying because he thinks there is plenty of profit to squeeze out of the company as it dies. There are reasons to stick around besides goodwill towards the company.

Re: The rise of the “successful” unsustainable company

#116

Post by corford » Wed, Oct 24, 2012, 7:31 AM UTC

9999 wrote: post #98

corford wrote: post #88

Earlier quoted context omitted.

These guys obviously aren't the sort of people that are happy to lie by the beach reading a book, quietly enjoying their millions. They're alpha dogs in the absolute worst sense of the word. They thrive off ego, winning, power, greed, narcissism and all those other lovely traits most people pulling similar moves seem to have. Think Gordon Geko. Remove the pin stripe suit, fast forward 30 years and change the modus op…

That thing that you said there does not describe Andrew Mason in any way shape or form. He used to post on a forum that I spent a lot of time on in the early 00s. He's a clever, funny guy, and he took most of his lessons in ethics from Steve Albini. Before Groupon, he created The Point which was a group funding site for social initiatives that in many ways resembled Kickstarter.

I'm happy to stand corrected on Andrew Mason since I don't know an awful lot about him. But as others have said, Lefkofsky definitely appears to fit the profile.

Re: The rise of the “successful” unsustainable company

#117

Post by staunch » Wed, Oct 24, 2012, 8:23 AM UTC

sirclueless wrote: post #115

staunch wrote: post #106

Earlier quoted context omitted.

If you think they're sticking around to make more money, then they must be trying to repair the company's stock price. Or you think they're still there out of a sense of pride or guilt. Either way it's not a pump and dump, and their goal is to turn the company around.

The only thing their continued presence at their respective companies tells us is that they think they can do better by staying than leaving. Mark Pincus might be staying at Zynga because he thinks he can turn around the stock price and make it a sustainable company, or he might be staying because he thinks there is plenty of profit to squeeze out of the company as it dies. There are reasons to stick around besides g…

He's got $200M and no one can take his massive equity away. I just think you have to be very cynical to think his primary motivation is money, at this point.

Re: The rise of the “successful” unsustainable company

#118

Post by mkramlich » Wed, Oct 24, 2012, 10:54 AM UTC

tptacek wrote: post #95

pg wrote: post #93

Earlier quoted context omitted.

If anything that supposed counterexample supports my point that the accusations these people casually make in HN comment threads are so much more drastic than they realize that they're their own reductio ad absurdum. Running a public company that's a scam tends to entail criminal behavior. Especially nowadays.

CA didn't start out as a deliberate scam, and continues to run today despite being essentially a scam for many years. The companies we're talking about today --- Groupon, Zynga --- don't have long enough track records as publicly traded entities for us to presume they're run in good faith; variants of the things that got Kumar sentenced probably aren't even crimes when they happen during mezzanine funding, when the p…

> My nerdly brain just couldn't handle the idea that being Andrew Mason in Q4'12 is so painful that simply holding his job imputes him credibility.

Agreed. If Pincus and Mason are having a hard time now, I'm sure they can have a good cry in their mansion or on their yacht, weekends in Aspen, luge lessons in Zurich, private Zoroastrian monk mentoring, perhaps a custom birthday song written by the Rolling Stones -- you know, the typical way of handling such hard times as these.

Re: The rise of the “successful” unsustainable company

#119

Post by joonix » Wed, Oct 24, 2012, 11:35 AM UTC

But Nguyen understands the arithmetic of Silicon Valley, and anyway he isn't one to reflect. "I never get emotional," says Nguyen, who hasn't spoken to his parents in six years. "I can have the biggest argument with someone, and five minutes later, I won't even remember that it happened." He's not even particularly attached to his name. In third grade, he had a crush on a classmate whose mother asked him his name. "I go, 'Vu.' She goes, 'Bill,' and I go, 'Aha!' And all my friends have called me Bill since then," recalls Nguyen. "My whole point was, I don't care what people call me. It's like, whatever's easier for people, I'm totally cool with it." He adds, "There is no Vietnamese person in the history of the world born with the name Bill. It's a total facade."

...This guy's a psychopath.

Re: The rise of the “successful” unsustainable company

#120

Post by [deleted] » Wed, Oct 24, 2012, 12:08 PM UTC

pg wrote: post #63

api wrote: post #2

This is diplomatic and charitable. When I see a repeat pattern of GroupOn and Zynga type companies I see someone who knows how to pump and dump. It's not quite fraud but it's getting close, given how loose these sorts of people typically play the truth.

Calling Zynga and Groupon pump-and-dump schemes is a mark of one's one's understanding of business in much the same way that believing vaccines cause autism is a mark of one's understanding of science. Mark Pincus and Andrew Mason are both still running these companies. Running a public company that's doing badly is extraordinarily painful. No one would bring that on himself.

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