Mini-Bubble??

A couple of weeks ago, I heard Julie Hanna Farris of Scalix contrast the current environment in Silicon Valley with that of the Bubble era:

It’s been interesting to reflect on the past nine years. Scalix is my fifth startup. The first startup was in ’95 at the beginning of the bubble, and so I watched what happened as we went up the bubble. The last startup was a company that had an $850 million dollar exit after one year. I watched the discipline of the investment banking community completely go out the window from the first startup (it was the “four to five quarters” discipline) to my last company. They would approach us and sit down and talk with us and we’d say, “Well, we’re working on our first big deal and we think we’re going to have revenue soon,” and they’d say, “Well, you don’t really need that – why don’t we talk about taking you out?” It was a bizarre experience.

Scalix also is two years old – we started during a desert, and I started the company as an entrepreneur-in-residence at a venture firm. I’ve often wondered if that hadn’t been our start, if we would have been able to get off the ground because it was quite an adverse climate. I think the return to discipline is valuable – I think what disciplined a company after the crash was fear. And the combination of discipline and fear created a really hostile climate for entrepreneurs. The bar became very high – became, in some ways, impossibly high. Advising the venture firm that I was involved with on deals as they were coming in the door, I was a lot of great stuff, a lot of great entrepreneurs, and it was kind of sad to see that they didn’t really have a chance to get going because of the fear and because a lot of the unanswered questions (because they were so early stage)…there weren’t answers to the questions that were on the table.

We’ve seen a balance come back, but I’m concerned that we’re actually in a mini-bubble now, again. It seems we have a difficult time being balanced and sanguine and getting real about what it takes to build a long-term sustaining company. I think that part of that is coming off the high of the party that felt really good and intellectually knowing, “Well, gee, that was a passing thing,” and another part, an irrational part, saying, “Well, maybe we can do that again”. I see some of that going on right now.

The past month has seen a lot of action. Hell, the last week has seen a lot of action. Yahoo acquired Oddpost; Microsoft acquired Lookout; Google acquired Picasa; Symantec snapped up Brightmail and TurnTide in quick succession. Reaching back a little further, Friendster got VC money, and NewsGator got VC money. Looking forward, Novell appears to be cash heavy and looking for acquisitions.

It hasn’t all been funding and acquisitions. There is much jockeying for strategic alignment and position, and trends of note in the news as well. Flickr (a hometown favourite) and Feedburner decided to get together; MovableType got themselves a new CEO and acquired its French partner; both Microsoft and Sun approved internal employee blogs; bloggers have been invited to the Democratic National Convention; and Technorati has just passed the 3 million blog mark. Meanwhile, Apple has announced a new iPod to follow up on its Airport Express. Things are hopping in the circle of Silicon Valley life.

What’s going on? Is this the start of something real or a bunch of geek intellectual wanking? Is Julie right? Is this activity a result of a lack of discipline, a land rush? Or the Next Big Thing? While, it’s unclear where all of this will end up, I find it interesting to note all of these technologies are enablers for the individual – individuals create the content, individuals control the content, and individuals use technology to choose which content matters to them. Not a distributor or broadcaster in site. Provided the lawmakers don’t get in the way with silly legislation, this has the makings of a truly liberating wave of technology for consumers, a new era of interpersonal connections.

The trick, of course, will be figuring out if anyone can make a buck off it!

US Management Style

There’s been an interesting discussion over on the Vancouver Company of Friends list. This week’s topic has been “Building Bold Careers”, peppered with numerous interesting comments and insights from Ian Christie, Rajesh Taneja, Stewart Marshall, and Peter Rees. As the posts have started to turn to talk of employers’ role in motivating employees and nurturing employees’ development, I started to think about something I noticed soon after joining the workforce here in Silicon Valley: the role of praise in inspiring employees.

Standard management/HR textbooks emphasize the need for managers to encourage their employees – but how many managers or employers actually make the effort? If there’s one difference I’ve noticed between US and Canadian management styles, it’s that there appears to be an increased emphasis on continual feedback and encouragement here in the US. I first noticed it in a weekly meeting with my manager – he somehow interpreted my request for additional feedback on some documentation I had prepared as a request for an impromptu performance appraisal, rather than a request for additional input for the document. I was quite surprised with the result – he proceeded to tell me how impressed he had been with my work thus far, especially considering I had prior experience in the type of position I currently held. This response was completely unexpected.

Since then, I’ve noticed there is a consistently high level of positive feedback within my company directed at all employees and from all levels of the corporate hierarchy. I’m not certain if this experience is representative of all Silicon Valley companies, US management style in general, or merely the culture at my current employer. However, given my American wife’s complaints about the lack of feedback she received from her employer while working in Canada, it makes me wonder if Canadian employers don’t adequately reward employees, not with money, but with endorphin-inducing positive feedback.

I suspect this is true, partially on the basis of my own initial reaction to the feedback I received from my US manager. At first, I didn’t accept that the praise being offered was genuine – was he kidding? Personally, I’ve never received a lot of praise at Canadian companies except upon achieving major project milestones. I’ve always been a high achiever, ambitious, and self-motivated – but sometime after joining the workforce, it appears I subconsciously learned that unless someone told me I was screwing up, I should assume I was doing a good job. I learned not to expect kudos for my good work! That wasn’t such a problem for me – but imagine the effect the lack of praise might have on an employee who needs career guidance.

So – is this just my personal experience with Canadian employers? Is my experience with my current US employer an anomaly? And what does this say about the limits of an employer to motivate and shape an employee beyond the boundaries established by the society in which they operate?