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Thursday, April 21, 2016

On Disruption: "OMG! Awesome!! Dan Lyons for President!!!


Yeah. Utterly fashionable, overwhelmingly euphoric term of late, particularly in the health care and Health IT space. Recall my recent post "Disruptive" solid tumor tx?" Recall athenahealth CEO Jonathan Bush's repeated calls for "More Disruption, Please"? Recall how the now-relentlessly-beleaguered  Elizabeth Holmes' Theranos was gonna lethally "disrupt" the entire incumbent clinical blood testing industry?

Well, there has in fact been some farting-aloud-at-the-party dissent, e.g., Leon Weiseltier at the NY Times last year:
Amid the bacchanal of disruption, let us pause to honor the disrupted. The streets of American cities are haunted by the ghosts of bookstores and record stores, which have been destroyed by the greatest thugs in the history of the culture industry. Writers hover between a decent poverty and an indecent one; they are expected to render the fruits of their labors for little and even for nothing, and all the miracles of electronic dissemination somehow do not suffice for compensation, either of the fiscal or the spiritual kind. Everybody talks frantically about media, a second-order subject if ever there was one, as content disappears into “content.” What does the understanding of media contribute to the understanding of life? Journalistic institutions slowly transform themselves into silent sweatshops in which words cannot wait for thoughts, and first responses are promoted into best responses, and patience is a professional liability. As the frequency of expression grows, the force of expression diminishes: Digital expectations of alacrity and terseness confer the highest prestige upon the twittering cacophony of one-liners and promotional announcements. It was always the case that all things must pass, but this is ridiculous.

Meanwhile the discussion of culture is being steadily absorbed into the discussion of business. There are “metrics” for phenomena that cannot be metrically measured. Numerical values are assigned to things that cannot be captured by numbers. Economic concepts go rampaging through noneconomic realms: Economists are our experts on happiness! Where wisdom once was, quantification will now be. Quantification is the most overwhelming influence upon the contemporary American understanding of, well, everything. It is enabled by the idolatry of data, which has itself been enabled by the almost unimaginable data-generating capabilities of the new technology. The distinction between knowledge and information is a thing of the past, and there is no greater disgrace than to be a thing of the past...
"There is no greater disgrace than to be a thing of the past."

Tell me about it.

My latest read. By iterative turns, howlingly hilarious, deadly serious, and infuriating. Early on, I could not help thinking of the early episodes of Season 5 of "The Wire," where seasoned journalists at the Baltimore Sun were losing their jobs in droves in the face of internet-"disrupted" seismic, irreversible economic shifts.

Beyond the personal, self-deprecating, eye-rolling "memoir" aspect, "Disrupted" is a fine and necessary piece of reportage.  Definitely 5-stars for me.

If you made a movie about a laid-off, sad-sack, fifty-something guy who is given one big chance to start his career over, the opening scene might begin like this: a Monday morning in April, sunny and cool, with a brisk wind blowing off the Charles River in Cambridge, Massachusetts. The man— gray hair, unstylishly cut; horn-rimmed glasses; button-down shirt— pulls his Subaru Outback into a parking garage and, palms a little sweaty, grabs his sensible laptop backpack, and heads to the front door of a gleaming, renovated historic redbrick building. It is April 15, 2013, and that man is me. I’m heading for my first day of work at HubSpot, the first job I’ve ever had that wasn’t in a newsroom. 

HubSpot’s offices occupy several floors of a nineteenth-century furniture factory that has been transformed into the cliché of what the home of a tech start-up should look like: exposed beams, frosted glass, a big atrium, modern art hanging in the lobby. Riding the elevator to the third floor, I feel both nerves and adrenaline. Part of me still can’t believe that I’ve pulled this off. Nine months ago I was unceremoniously dumped from my job at Newsweek magazine in New York. I was terrified that I might never work again. Now I’m about to become a marketing guy at one of the hottest tech start-ups on the East Coast. There is one slight problem: I know nothing about marketing. This didn’t seem like such a big deal when I was going through the interviews and talking these people into hiring me. 

Now I’m not so sure. I reassure myself by remembering that HubSpot seems pretty excited about having me come aboard. Cranium, the chief marketing officer or CMO, wrote an article on the HubSpot blog announcing that he had hired me. Tech blogs wrote up the story of the fifty-two-year-old Newsweek journalist leaving the media business to go work for a software company...

Lyons, Dan (2016-04-05). Disrupted: My Misadventure in the Start-Up Bubble (pp. 1-2). Hachette Books. Kindle Edition.
I came to this book by way of a review at THCB, "Beyond the Valley of Hype and the Plateau of Despair" by David Shaywitz, MD.

Intrigued, I read the Amazon "Look Inside" preview. Further intrigued by that, I started reading the Amazon reader comments. I typically begin with any 1-star negative reviews. More than one or two of those is often a deal-breaker for me. There are just too many dad-gumbed books to buy and read (along with all of my periodicals), and I'm not getting paid to do so.

The negatives in this case, though, evinced a bit of trollish suspect quality (pissed-off sock puppet HubSpot employees?). So, I turned to the 5-star commentaries. After a good number of those, I thought "yeah, OK, I get it."

I clicked the Kindle edition "Buy Now With 1-Click" bar.

Really glad I did. A compelling read. Finished it in a day. The joke "I spewed my coffee all over my screen" is apt. After I finished, I thought "Dr. Shaywitz, Methinks Thou Dost Protest Too Much."


I now serve as a volunteer one day a week at San Francisco's "" senior dog rescue/foster/adoption service in the Mission District.

I knew my Master's would one day come in handy for something. When not walking dogs or mopping up pee, I spend most of my Fridays down in the basement doing the endless onslaught of laundry they generate. I may shlep one of my 12-strings one of these Fridays and 'shed some tunes while doing the wash. Lord knows I still need the practice.

One of my fellow volunteers is a nice young guy who works in marketing at Salesforce (everyone is starting to look really young to this Geezer-in-Training), the company that has pretty much taken over a good bit of downtown San Francisco. I mentioned that I'd seen that Salesforce was getting into the Health IT space, and that I'd posted about that on my blog last fall.

I also told him "yeah, ONC made us use Salesforce while I was in the Meaningful Use program with the Nevada/Utah REC. I didn't dig it that much; it was not a great fit for what we did. And, we actually resorted to mirroring it by using Microsoft Access and Microsoft CRM to capture, via screen-scrapes and double-entry, the accruing business intelligence for post-REC HealthInsight purposes, since ONC would own the Salesforce REC cloud database (though not the taxpayer-acquired data themselves) once the HITECH contract ended."

Dan Lyons:
Thirteen: The Ron Burgundy of Tech.
Imagine Joel Osteen pumped up on human growth hormone. Imagine there’s a secret government lab where scientists have blended the DNA of Tony Robbins with the DNA of Harold Hill, the aw-shucks shifty salesman from The Music Man. Imagine a grizzly bear in a pinstriped suit, standing on his hind legs and talking about changing the world through disruptive innovation and transformation. 

If you can imagine those things then you can almost imagine the horror of seeing Marc Benioff, the billionaire founder and CEO of, on stage at his company’s annual conference, Dreamforce. It’s November 2013, and that’s where I am, along with Cranium and Spinner and a bunch of other HubSpotters, sitting through Benioff’s three-hour keynote speech on the opening day of the conference. I was psyched when Cranium asked me to go to Dreamforce, if only for the chance to spend a few days in San Francisco. I haven’t been back here since I left my job at ReadWrite. I have a list of people I want to see, restaurants I want to visit. 

But San Francisco is a shitshow. One hundred forty thousand people have descended on a one-square-mile area of downtown. Dreamforce takes place over four days, with concerts and comedians and inspirational speakers. It’s basically Woodstock for people who work in sales and marketing. Or, as Benioff has declared, “the largest and most transformational event in the history of enterprise technology.” 

Entire blocks have been shut down to traffic. All of downtown is gridlocked. Restaurants and hotels are booked solid. I’m staying at the Courtyard Marriott, which was my home away from home during my stint as editor of ReadWrite. Last year I spent so many months living in this hotel that when I walk into the lobby the woman at the front desk recognizes me and remembers my name. Last year I paid $ 129 a night. This week, because of Dreamforce, I’m paying close to $ 700 a night. As for getting around town, forget about finding a taxi. They’re all booked. Oh, and the forecast calls for rain. It’s a nightmare. 

None of this is as awful as Benioff himself. He stands six-feet-five-inches tall and weighs three hundred pounds, with gleaming white teeth and curly black hair that glistens with hair gel. He is a former salesperson who now sells software that lets other salespeople sell more stuff. It’s called customer relationship management, or CRM, software. Benioff is also one of the wealthiest people in the world, a member of the Forbes billionaire list. Here in the main auditorium of the Moscone Center, thousands of people who sell things over the Internet are standing up and cheering for him as if he’s some kind of superhero. 

The whole thing makes me depressed, in part because Benioff is a buffoon, a bullshit artist, and such an out-of-control egomaniac that it is painful to listen to him talk. He lives in Hawaii and signs his emails “Aloha.” He’s a Buddhist and hangs out with Zen monks from Japan, and he gave his golden retriever the title “chief love officer” at his company. He is the Ron Burgundy of tech. He and this conference are the essence of everything that has gone wrong in the industry. “Have you transformed the way you innovate?” was Benioff’s big line at the 2012 Dreamforce show. Note that you can switch the two buzzwords in the sentence and it still sounds good and still means nothing. Meaningfullessness is not a word, but should be. There’s an art to this kind of horseshit, and Benioff is its Michelangelo...

We’re here in part to steal ideas— we’ll see what these guys do to create a spectacle and copy that for our Inbound conference in Boston. We’re also here to gather competitive intelligence, to see how Benioff talks about his new marketing software and what the audience makes of his pitch. We want to find out what we’re up against. 

Based on what I’m seeing, we’re in trouble. Sure, Benioff is full of shit, but so are we, and Benioff is way better at being full of shit than we are. Also,’s sales are about fifty times what ours are. In terms of hype, the disparity is even greater. Just two months before this, HubSpot’s Inbound drew five thousand people, a tiny fraction of the Dreamforce audience— even after giving away or selling a lot of our tickets at a discount. 

We’re screwed, I keep thinking. We’re totally, absolutely screwed. Not because the ExactTarget product is better than ours, because who even knows, and who even cares? Having the best product has nothing to do with who wins. What matters is who can put on a great show, who can create the biggest spectacle, who can look huge and unstoppable and invincible, and who is the best at bluster and hype. 

When it comes to these things, nobody comes close to Benioff. Nobody has cashed in on the bubble as well as he has. In 2012, lost more than a quarter of a billion dollars, and in 2013 it will lose almost as much. In 2013 the company is fourteen years old and not making a profit. But its revenues are growing more than 30 percent each year, and growth is what investors are looking for, so even though is bleeding red ink, its stock has doubled over the past two years, and Benioff’s personal net worth has soared to $ 2.6 billion. 

Now, here in the Moscone Center, the P. T. Barnum of the tech industry is giving a master class in how the game is played. It’s the Marc Benioff show, brought to you by Marc Benioff, with special guest Marc Benioff. Fifteen thousand people are packed into this hall. Thousands more are packed into spillover rooms. It feels like a rock concert. In fact it is a rock concert. Before Benioff appears, the lights go down and suddenly Huey Lewis and the News are performing “The Power of Love.” It is nine in the morning. From our seats, way in back, we can barely see the band, but we watch on huge screens, the kind used at football stadiums. 

Next comes Benioff, making a big high-energy entrance, like some kind of cheesy talk-show host, roaming up and down the aisles, a man of the people. He wears a blue suit and a pair of multitoned shoes, called Cloud Walkers, custom made by Christian Louboutin. He says he chose that Huey Lewis song because the power of love is what is all about. He doesn’t want to talk about business. He wants to talk about the hundreds of millions of dollars that he and have donated to worthy causes. “The best drug I ever took,” he says, “was philanthropy.” 

I suspect that opening with a big-name band is also a form of dick measuring. It’s Benioff’s way of saying, “I just spent three hundred thousand dollars to have a band play one song. You know why? Because I can.” The same goes for his philanthropy. Benioff says he’s challenging other tech billionaires to give away as much money as he does. The thing is, a lot of rich tech people do give away a lot of money; they just don’t go around bragging about it. Benioff’s challenge is a form of self-aggrandizement, his way of saying that while others might give away money, Mine is bigger. He wields his philanthropy like a four-foot cock, slapping us all in the face with it...

Dreamforce rolls on. Over the next few days the show features some of the biggest names in tech, like Dropbox CEO Drew Houston, HP CEO Meg Whitman, Yahoo CEO Marissa Mayer, and Facebook COO Sheryl Sandberg. Benioff has latched on to the “Women in Tech” crusade and made it his cause célèbre. “Powerful women” is a theme of the conference— yet oddly enough only four members of Benioff’s twenty-two member management team and only one member of his board of directors are female. is run almost entirely by white men. But look— over there! It’s the prime minister of Haiti! And wait, hold on— is that thunder and lightning? Indoors? Is that a Tesla? From the future? On stage? 

Green Day plays a concert in AT& T Park, home of the San Francisco Giants. Alec Baldwin gives a talk. Tony Bennett and Jerry Seinfeld make appearances. It’s all part of what describes as “dynamic programming to exhilarate the Dreamforce community.” Cavernous halls are lined with countless booths rented out by software makers hawking programs that work with Salesforce: add-ons, plug-ins, mobile apps. There’s a “connected devices playground” and a “Dreamforce hackathon.” There are more than a thousand breakout sessions and “success clinics,” where people can learn how to sell stuff. Two people dressed up in foam balls— the mascots, SaaSy and Chatty— bounce around the conference, dancing awkwardly with legions of mostly white people...

I stay in my hotel and gaze out my window at the rain-blurred lights down below, marveling at all the money and evil sloshing around down there. One hundred and forty thousand salespeople have hit San Francisco, armed with expense accounts and determined to have the time of their lives. They will sleep with their clients. They will sleep with their colleagues. Hookers have flown in from all over the country for this. Tinder and Grindr and the Craigslist “casual encounters” listings are packed with out-of-towners looking to hook up. The strip bars and S& M clubs are booming. Dreamforce turns out to be a four-day orgy worthy of Caligula, a triumph of vulgarity and wasteful spending, with free booze and endless shrimp cocktail and a rate of STD transmission that probably rivals Fleet Week. 

Gazing down on this mess is like looking into the pit of Mordor. So many lost souls! These glorified car salesmen, these people whose jobs involve coercion and manipulation, whose lives revolve around making their numbers. Every month, every quarter, every year: sell, sell, sell! These are the people who took the Internet, one of the most wonderful and profound inventions of all time, and polluted it with advertising and turned it into a way to sell stuff. No wonder these zombies need to take a week off in San Francisco once a year, with some Deepak Chopra and maybe an eight ball of coke and a Canadian hooker to make the whole thing seem worthwhile. 

Dreamforce is only part of Benioff’s mad campaign of megalomaniacal self-aggrandizement. Five months from now, in April 2014, Benioff will announce plans to make the anchor tenant for a new skyscraper that is already under construction in San Francisco. will commit $ 560 million to help finish work on the one-thousand-foot glass-and-steel skyscraper, which will become the company’s headquarters and be named the Salesforce Tower. When it opens in 2018, it will be the tallest building in the city, dwarfing everything around it. Maybe Benioff is oblivious to the phallic symbolism, or maybe he doesn’t care, or maybe— and this is my theory— he knows exactly what he’s doing and he loves it. Mine’s bigger! It’s the biggest! 

For P. T. Benioff there is no end to the extravagant spending. At the 2015 Dreamforce he docks a one-thousand-foot-long luxury ocean liner at pier 27 to serve as a hotel and party space— the Dreamboat, he calls it. still isn’t turning a profit, but thanks to Benioff’s huffing and puffing’s market value has topped $ 50 billion and Benioff’s own net worth has swollen to $ 4 billion. Benioff has invented a form of financial alchemy, one where he makes money by losing money. The more Benioff squanders on parties, the richer he gets. 

Looking down from my hotel window in November 2013, I realize that things are playing out exactly the way Tad, my investment banker friend, told me they would when I met him for a drink just one year ago at Anchor & Hope. This is what a trillion-dollar wealth transfer looks like. Across the country, in New York, bonuses on Wall Street are going to be the highest they’ve been since 2007, before the crash. In 2013, there will be more IPOs than in any year since the dotcom bubble peaked in 2000, and in 2014 there will be even more, according to Renaissance Capital, a company that tracks the IPO market. 

Surely it cannot end well when a bunch of money-losing companies go racing into the public markets, and when risk that previously was confined to private investors gets shifted onto the public. Nevertheless, the Fed keeps printing money, and the stock market keeps going up. The ducks are quacking, and the VCs are racing for the exits, launching IPOs as fast as they can... [Dan Lyons, pp. 128-137].
Ouch. That, while a bit lengthy, is just an "Amazon Preview"-ish chapter excerpt.

Five stars. Again, by turns hilarious, deadly serious, and infuriating. An important piece of cautionary journalism overall, IMO. Buy it. Enjoy.

Since I started covering Health 2.0 events several years ago, I've had repeated looks at all this irrepressively exuberant Health IT VC stuff. Dan's book has provided additional heft to my "Free Beer Tomorrow" dubiety.

Inclusive of its darker socioeconomic implications.

During the last Health 2.0 WinterTech Conference I watched a presentation by a guy representing a startup company pitching an AI-assisted "app" that recursively calculates your "Health Score" -- akin to a FICO credit score. You enter in some basic data and get a baseline score. Then, as the app reaches out to mine various elements of your social media accounts (once you've clicked the ever-handy "I agree" auth), the "score" gets refined and re-refined over time.

What could possibly go wrong there?

Lordy. See my post from about a year ago "The old internet of data, the new internet of things and "Big Data," and the evolving internet of YOU."

I used to work in subprime credit risk modeling. I could give you chapter and verse of what can (and will) go wrong.

A Final Dan Lyons cite:
We share our information with companies all the time. We send email through Google or Microsoft. We store files on Dropbox. We shop on Amazon. We buy apps and music from Apple. We hire drivers through Uber, and rent apartments through Airbnb. Companies use Workday for HR, Zendesk for customer service, for customer tracking, Slack for messaging, and on and on. Most of these companies don’t operate their own data centers. Instead, they rent server and storage space from a hosting company like Amazon. Our information gets distributed around the globe, zipped between data centers at the speed of light, stashed on hard drives, backed up, duplicated, replicated, sliced and diced, sold and shared. Even the people who supposedly manage our data have no idea where all of it resides or who has access to it. 

Yet we go along. We convince ourselves that nothing bad will happen. We tell ourselves that we’re not important enough for anyone to spy on us, or that even if someone did want to spy us, there must be safeguards in place that prevent bad people from snooping. We hear the people who run these online services present themselves as idealistic do-gooders who want make the world a better place. 

Even if we don’t believe them, we understand that they have a financial incentive not to spy on us. They don’t have to be good people, or honest people, or law-abiding citizens. They just have to want to make money. They can’t do that unless people trust them. Their own greed will keep them honest— that’s the theory, anyway. 

So we figure we’re safe. We figure we can trust the people who run online services not to snoop on us. I used to believe that. I don’t anymore. Halligan, Volpe, and Chernov were not random nerds going rogue in some data center. They were top executives of a publicly traded company. They’re the ones who were supposed to be keeping an eye on the others. During my time at HubSpot, I was shocked to see how badly managed the company was and how packs of inexperienced twenty-something employees were being turned loose and given huge responsibility with little or no oversight. In the world of start-ups that is now the norm, not the exception. 

The consequences are just what you would expect. Employees at Uber, the ride-sharing company, have used a “God View” feature to stalk people using the service, including a BuzzFeed journalist. Re/ code, a tech blog, claims other companies have done the same, including Lyft, a rival to Uber; Swipe, a photo-sharing app; and Basis, which makes a “health watch” that tracks people’s heart rates, sleep patterns, and other personal information. In the early days at Facebook, the young employees had a master password to gain access to anyone’s account, according to a book by a former Facebook employee. Dirty tricks have become par for the course at these places. In 2011 Facebook was caught running a sneaky smear campaign, hiring a PR firm to spread negative stories about Google— I know because I’m the reporter who caught them and broke the story for Newsweek. Facebook’s entire business model is based on mining personal data in order to deliver targeted advertising. The same goes for Google and countless other online companies. We have no idea who has access to what. 

We also have no choice but to go along. None of us is going to opt out of using the Internet. Nor can we expect that the companies will do any better when it comes to oversight. They’re funded by venture capitalists who seek only the biggest and quickest return on their investment. That means hiring kids, cutting corners, breaking rules. It does not mean investing loads of money in order to build safeguards and protect users. There’s an adage in Silicon Valley that people who use online services are not the customers. We’re the product. As far as companies in Silicon Valley are concerned, we exist solely to be packaged up and sold to advertisers. We should not expect these companies to look out for us... [Dan Lyons, pp. 255-257].
All the raucous hilarity of "an old guy" struggling to fit in with the organizationally random MEGO 20-somethings' culture of an internet marketing company aside, this is a serious and valuable piece of work. All the more entertaining for its chortle-inducing Michael Lewis-esqe snarkiness.

We don't need another "built-to-flip" tech bubble burst. That one may well happen, though, would not surprise me one bit.


Wow. That is very sad. The news broke just as I was finishing this post. One of my friends, Paul Peterson, (who once got Kenny Loggins to come to the Santa Fe gig for us) was his keyboard player during the whole "Purple Rain" thing. He's inconsolably stunned at the news.

Undisrupted: HubSpot's Reflections on "Disrupted"
Dharmesh Shah, Founder and CTO at HubSpot

It has been almost 10 years since the two of us founded HubSpot. If someone had told us then that someday, the company would grow up to be publicly-traded and have over a thousand employees, we would have been cautiously hopeful. After all, the plan from the beginning has always been to build a successful, enduring company. But, if someone had also said that we’d have a satirical author write a scathing book about us, we would have never believed that. That was definitely not the plan. Besides, who’s going to want to read a book about HubSpot? 

Last week, Dan Lyons, a former employee of HubSpot released just such a book: “Disrupted: My Misadventure In The Start-Up Bubble.” And as it turns out, a lot of people are reading the book. We have now had a chance to read it ourselves and reflect on it a bit...
I would say buy and read Dan Lyons' book. Decide for yourselves. I see they're thus far not suing him for libel.

More to come...

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