Silicon Valley Charm School, Attendance Zero

by Scott Jangro on 14 December 2008

suntzu.jpgAs I read about the scuffle between Michael Arrington and, well, the entire European Internet community, I’m reminded of another high profile Silicon Valley individual making waves at another industry conference.

In the recent case, Arrington was on the stage at LeWeb ‘08 in Paris. In response to Loic Le Meur’s statement that Silicon Valley moves too fast, and that Europeans enjoy a good two hour lunch just to experience the joy of life, Arrington recounts in his blog post:

“…the joy of life is great, but all these two hour lunches over a bottle or two of great wine and general unwillingness to do whatever it takes to compete and win is the reason why all the big public Internet companies are U.S. based.” — via Joie De Vivre: The Europeans Are Out To Lunch

Ouch. Thank you, may I have another?

Almost a year ago, Jason Calacanis stood on the stage at Affiliate Summit and essentially called Affiliate Marketers a bunch of spammers and short-sighted entrepreneurial wannabes. He scoffed at the $100,000 single paycheck earned by a kid (read revenue) and suggested that we aim higher, that in silicon valley they like to add a few zeros and get it as VC money (read debt).

Instead of screaming to have Calacanis banned from another industry event, my response was, “Holy crap, is this really how the valley perceives affiliate marketing?” We’ve got a serious image problem, one that matters when a big source of our traffic comes from companies who live in that valley.

The comments may sting, and the SV guys are remarkably without tact. But look in the mirror at yourself and the people around you, who define you to the rest of the world. Is there any truth there? And does it matter?

You may decide that you don’t need or want to be more like the Silicon Valley rat-racers as they think you should. But at the very least, understand what they’re thinking, and check to see what you can do to be better in business, and how you may deal with them better in whatever ways you need to.

Fighting back with words won’t change their attitudes. Action will.

I’ll let Sun Tzu make the point for me:

If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle. –Sun Tzu, The Art of War

  • I would say that perception of affiliate marketers is that they are one notch above used car salesman. However, I do not believe it has been brought to the main stream public and 100k checks have not been shown as the norm by any means and so the only people who know what an affiliate marketer is are internet minded people who have little use for affiliates.
  • There's a lot to be said for being nice and playing by the rules - I'm reading tom Monaghan's biography (Domino's Pizza) and he plays it straight all the way. Manners and politeness cost nothing - this gets lost in the world of business all too often methinks.
  • I loved the Sun Tzu's Quotes and it all make sense to me...
  • Your site is so nice. Esperially it is nice as visual.
  • My 2 favorite quotes from Sun Tsu are...

    "We cannot enter into alliances until we are acquainted with the designs of our neighbors."

    Entering partnerships in business, requires an unrushed courting period, where you get your last chance to learn if she's a good match, with good intentions, before any damage can be done.

    ~~~~~~~~~~

    "The difficulty of tactical maneuvering consists in turning the devious into the direct, and misfortune into gain."

    Optimists is business, see opportunities where many see as obstacles, making this not only a Sun Tsu classic, be a real life Yin-Yang truth. Conquering obstacles (aka achievement) first requires you to recognize them, them to have the will to try to vanquish them, then the savvy and patience and intellect to devise and implement tactics to that end.

    ~~~~~~~~~~~~~

    These antagonists, Calcanis and Arrington, to me, are just the road noises we hear along the way on our ride. Beep, beep.
  • I would agree with you on the charm school part. I am not at all in either of these businesses, but i get amaised at how people like to talk trash. Why can't people just do their thing and let other do their thing. well it's not Sun Tzu, just my 2 cents
  • Scott, you are right about VCs using debt. It's just that it's sometimes it's rather disguised.

    I worked for a company that received VC financing, but it emerged later that there was interest accruing for the amount the VCs had put into the company. This meant that when we eventually went public (after many years), the VCs were paid back their interest from the proceeds of going public, and then they also got to cash out of their stock (they owned most of the company). To be fair, they would have lost everything if the company failed, but they did get this extra "bump" in the terms that they negotiated, which really wasn't talked about openly - it just slipped out at a meeting.

    The explanation I heard was that this provided an incentive to exit quickly, before more interest piled up. Incentive indeed!

    I haven't heard people talking much about this tactic. Usually it's just the VC=Equity Financing thing. But here's a pdf that talks about it in some more detail:
    www.yvcs.org/uploads/1118448011Venture%20Debt_f...

    Personally, I'll take $100k in affiliate revenue with no strings attached over $10mil in VC funding any day. But then again, I'm a salesman at heart.
  • Oh, how 99% of those valley companies who burnt through their angel money wish right now they had a stealthy, profitable affiliate marketing model.
  • Thanks for the clarification. You're correct on failure. But with success, they're the first to want to get their money and then some. Maybe I should have said indebted, not debt.

    eh, I should have left the parentheticals out completely. :)
  • Testing intensedebate. repying to myself.
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