Empathy towards broader society, especially those who are being disrupted by technology is something that is always on my mind. Here is something I wrote nearly two years ago . I want to bring it back into focus mostly because of some recent commentary around technology and social inequality.
In 1990s, we had a generally upbeat economic environment around the country and there was a sense of naive optimism around the internet. Then came the gold rush and later the malfeasance. Right now we have a country that is facing an unending economic uncertainty, especially for a large swathe of people. As a result, the Bay Area stands out and finds itself living under a microscope. There is no naive optimism; just gross entitlement and that is what’s wrong.
Our industry has boom and bust cycles that are much faster that any other industry and at the same time have unsaid but distinct barriers to entry. The internet-speed cycles lead to many more startups and more people becoming millionaires faster and at a much younger age than any other industry — even the older version of the internet industry. We also forget that the same speed which thrills, also kills. The recent retrenchment of technology stocks is a good reminder that the craziness doesn’t get to mania levels anymore.
The 1999 bubble was driven by stock markets where insane valuations for crap stocks led to insane decisions by equally insane (and clueless) venture investors. This time around, the stock markets, after overpaying for initial public offerings from much of 2013 and 2014, have come to their senses and decided that bad businesses aren’t to be rewarded. A Deutsche Bank report pointed out that 86 percent of IPOs have broken issue and 91 percent are trading below their first day close. Clearly, the market has skimmed out the froth and continues to re-price stocks including Twitter, which has trended down in recent days.
The bad behaviors, like everything, get magnified too much by social media. I mean, last week in Italy people were asking me about Google buses, protests and what is wrong with the tech industry. I don’t know what is wrong except that the social norms and behaviors of players are different. The world looks at the gratuitous amount of profits made by a company like Google, and juxtaposes it against the lack of hope for a majority of the planet.
People dislike Uber, not because some founder is going to become a billionaire; the discontent comes from the visible disparity between those who have it and those who don’t. Google buses get rocks and eggs thrown at them mostly because they are a reminder of digital feudalism. As an industry, we are very fortunate; and that is why it is important to remember why we need to have compassion and understanding about the fears of the rest of the world. We need to remember that our actions now intersect and influence those who are not of our industry. Trying to be in their shoes isn’t a bad place to start.
And this is what I said (again in 2015.)
Automation of our society is going to cause displacement, no different than mechanization of our society in the past. There were no protections then, but hopefully a century later we should be smarter about dealing with pending change. People look at Uber and the issues around it as specific to a single company. It is not true — drones, driverless cars, dynamic pricing of vital services, privatization of vital civic services are all part of the change driven by automation, and computer driven efficiencies. Just as computers made corporations efficient — euphemism for employed fewer people and made more money — our society is getting more “efficient,” thanks to the machines.
While many of the technologies will indeed make it easier for us to live in the future, but what about the side effects and the impacts of these technologies on our society, it’s fabric and the economy at large. It is rather irresponsible that we are not pushing back by asking tougher questions from companies that are likely to dominate our future, because if we don’t, we will fail to have a proper public discourse, and will deserve the bleak future we fear the most.