Beware of Ballers on a Budget | Hacker News Reader

Beware of Ballers on a Budget

bothsidesofthetable.com

70 pointsssclafani44 comments

Silicon Valley has been filled in recent years by people who've seen movies like "The Social Network" and read TechCrunch with its myth of the heroic entrepreneur, and have come here thinking this is how it is.

They are emulating a simulation of a startup that really isn't anything like the real startup. It as if Baudrillard's Simulacrum of a startup has taken over Silicon Valley. http://en.wikipedia.org/wiki/Simulacra_and_Simulation

These folks feel they have to live some mythical startup lifestyle and - a particularly hated phrase in my book - fake it till they make it.

> Silicon Valley has been filled in recent years by people who've seen movies like "The Social Network" and read TechCrunch with its myth of the heroic entrepreneur, and have come here thinking this is how it is.

Really? I seem to have met someone like this last year when I first arrived in the Bay Area, but he seemed to be focused on the racier party scenes in "The Social Network." There was one incident where he decided it would be dandy repeatedly to leap up and down from his bunk to the floor, in the process spilling a glass of beer on a woman's Macbook and upending it face-down opened on the floor. He didn't apologize to her or even acknowledge that he did it.

This guy has the gall to mumble editorial comments under his breath while I'm trying to talk business to someone.

He's also the quintessential example I give of shallowness I've encountered in the Bay Area:

    "This needs better design."
    "Really? Do you know what those buttons do?"
    "...no."

When pressed for what better design constitutes, he recommends a different font and "some gradients."

In fairness, not knowing what buttons do at a glance can indeed be an indication of bad design.

Sure, but unless the buttons function as buttons was obscured, not pressing them to find out what they do during a critique is shallow.

I don't remember much (or any) of The Social Network being set at SXSW or anything like SXSW. :)

This story is actually as old as the gold in them thar' hills. Sub 'California (or 'The West' or 'America') for 'Silicon Valley'. Sub other industry and era-appropriate myths for 'The Social Network'.

And we kind of need all the fantastical bullshit self-reinvention... because a tiny little bit of it is really new and great. The only way to find and fertilize that tiny genuine seed is to welcome all the other crap in large volumes.

If you want Makers, you also have to humor lots of Fakers.

faking it is fine if you actually make it. if you don't, then you're just a baller on a budget

tell them welcome back!

ITT: People in SF get a taste of LA and NYC.

Every city--and culture--has people who look flashy above their means. In Dallas, the stereotype is called called $30,000 Millionaires[1] and every car dealer can spot one from a mile off. Working for one can be a miserable experience or it can be a great way to expand your own wings. In my experience, the jet-setter likes "groupies" who appear to raise his own stature. Use this to your advantage to accompany him or her on these trips, then do your own networking either for yourself or for your company. Investing: if you don't have the resources, leverage someone else's.

1 - http://www.dallasobserver.com/2007-11-29/news/douchebags-in-...

"People who are actually from Gangnam never proclaim that they are—it's only the posers and wannabes that put on these airs and say that they are "Gangnam Style"—so this song is actually poking fun at those kinds of people who are trying very hard to be something that they're not."

—PSY (via http://travel.cnn.com/seoul/play/interview-psy-gangnam-style... )

You're completely right. Every culture has this, and such people can be either dangerous or profitable -- depending on whether they're wasting your money, or spending their money in ways that benefit you.

It's funny that he praises Trevor Owens, but the picture on Trevor's Facebook page shows him (apparently) speaking at a conference: http://www.facebook.com/trevor.owens

Not to pick on Trevor but what qualifies him to run a lean/entrepreneurial workshop? Has he had a successful startup? If not, how is that any better than being a "conference ho"?

This post is weak-sauce IMO

Weak sauce because it's untrue, or weak sauce because the author and/or his cohorts are allegedly part of the same group he's criticizing?

I think the term "ballers on a budget" is often inapplicable to the types of waste and inefficiency I observe in the tech scene. My take is that the author thought this was a clever term and tried to relate it to something he knew about, but it doesn't really fit.

I propose the term "idiots with no idea what they're doing with their investors' money" since that seems to fit better to the types of people the author is trying to talk about.

Weak sauce because it was a bit incoherent and the counter example didn't seem much better.

I've never really seen any poser CEOs at the conferences I attend. Usually genuinely successful founders or legitimate hackers. Maybe I'm going to the wrong events.

absolutely nothing qualifies me to run a lean/entrepreneurial workshop. except our workshops kick fucking ass.

what qualifies you to start a business? what qualifies anyone to do anything?

Take a step back and think about what you just said. Many startups can be launched without any specific qualifications or experience. You can learn as you go, fumble around, yet still find product-market fit and grow. I've done it and so have many others.

Maybe I'm taking crazy pills, but once you enter the realm of teacher/speaker/mentor/workshop-runner, I thought it was sort of assumed that you've previously put your knowledge to the test and at least tried to build something. Hell, even if you tried something and it was a huge smoldering failure, that's better than jumping on stage as soon as you close your copy of the Lean Startup.

Sorry, I really don't mean any disrespect. I just don't want to see an ecosystem of "startups teaching people how to build startups that teach people how to build startups" I've seen it in other industries and it sucks.

No worries. I didn't mean to sound harsh in my tone. I thought your comment was a snap judgement without any real research. If you did do research you would know that I don't do all of the teaching, we bring in experts from every location, just like a conference.

> absolutely nothing qualifies me to run a lean/entrepreneurial workshop. except our workshops kick fucking ass.

If your advice isn't proven, by what possible standard can the workshops kick ass?

> what qualifies you to start a business? what qualifies anyone to do anything?

Starting a business isn't giving advice, it's doing the work to know what advice to give, and unless one succeeds at doing so, one doesn't have advice worth being heard.

If I want to be a successful entrepreneur, I'm not taking advice from someone who hasn't been a successful entrepreneur; I'm amazed anyone would. One shouldn't teach what one can't do.

Not necessarily the best tone for this crowd, although I definitely did enjoy and get much out of the multi-day workshop we did last year. We're still applying the principles company-wide, but Trevor does offer a solid product.

Thanks. Apologies on the tone.

>"Whoa. Why so many on leases?"

Because leasing is a pretty efficient system that can be economically superior to buying an asset that depreciates like mad the instant you sign the papers?

Leasing isn't reserved for people who can't afford to buy a car, just like renting isn't reserved for people who can't afford to buy a home.

Even more fun is when you buy a car for $17k cash new, 11 years later it's still "worth" north of $4k, but you own it outright, it's reliable and doesn't break down, and costs you basically gas (money/miles) + oil changes to operate it and statistically for the make and model has about another 80k miles before it's expected to start needed expensive repairs. At my rate that's 8-10 more years.

What car is worth 25% 11 years later? Honda civic?

don't know why you got downvoted, but yeah, I drive the most humdrum Honda civic imaginable. Other than tires, brakes and oil, the only thing I've had to fix was a $100 air mix sensor that broke after 10 years.

I do wish I drove a nicer car, but then I remember that extra trip to Europe or Asia I take every year instead and it more than makes up for it.

I seem to get downvoted all the time here though. :-/

I buy cash nice german cars that are three or four years old: that's during these years that they lose the most of their value.

Low mileage and I know they're good to go for at least 50k miles or so with only oil and tire change.

Then I resell them and rince and repeat.

Very good bang for the bucks.

You can probably score a just out of lease 3 series BMW for what, $18k (i.e. a new mid-level civic)? Get it certified for maybe $22k? And drive it for 4 or 5 years, it'll still be worth maybe $10-12k? So really your out of pocket expense is only about $10k once you kick start it.

It's not a bad idea, and the 3 series are pretty dependable.

Leasing might beat buying new, but if you buy used the depreciation works in your favor.

You can write off leases as a business expense. You have to track depreciation and many other things, if you buy it outright. Leases go right into monthly expenses and reduce your taxes immediately.

I agree I worked for companies who had the expense budget but not the purchase budget. So I suggested they lease their PCs instead of buying them, store all data on a server, and every three years get new leased PCs. It saved them money and gave them a tax break. Every three years technology changes anyway and instead of buying new PCs they just return the old leased ones and buy new leased ones.

The PCs companies leased, usually get sold very cheap by a liquidator. Then companies and people on a limited budget can buy the used PCs.

Cars are basically the same way.

I have doubts about depreciation playing any significant role here (Edit: in profitability of lease vs buy.) No free lunches - who covers the depreciation when you lease?

You do. That's what you are paying for in a lease, the depreciation that occurs over the term of the lease, plus interest and whatever other spread the finance company/manufacturer/dealership takes. They sell the car at the lease end for the value of the car less the depreciation you "used".

Lease/buy in an efficient market should be equally profitable. Most of the lease benefits are from taxes.

What about wear and tear charges at the end of the lease?

The problem lies with the investors. They would rather invest in a group of guys well known on the conference circuit than the team of unknowns with great work ethic.

My wife is a big fan of the term "ballin on a budget", which means that we get nice things by saving for them, and by learning how to make things like nice meals for ourselves. If we go to a restaurant and pay a lot of money for a plate and decide we like it, we'll figure out how to make it. Slowly but surely that bar of "what's worth going out to a restaurant for" is shrinking. Not that we don't go out to restaurants, we love doing it because it's fun, but we're learning how to make really high-quality meals together.

The other part of her "ballin on a budget" lifestyle is saving for nice things, not going into debt for them. The car we own is totally paid off. While it's not the nicest car you'll see in LA, it's definitely not a hoopty. One thing I do notice a lot about West Hollywood especially (where I live and work) is the fact that at least half of the nice cars have dealer plates on them still. People must not keep cars for much longer than a few months or something!

I like the term "30k Millionaire" better if you want to degrade people who go into debt to look richer than they are lol

The interesting part is that the article ends with him and McClure traveling to China for a conference circuit. Did they have any customers in China?

As a rough proxy for the correlation between tech circuit exposure and results, it would be useful to make a scatterplot of the (number of times a company is mentioned on Techcrunch) vs. (exit value in USD). Two companies at opposite ends of the spectrum would be Foursquare ($2M revenue in 2012, mentioned frequently on TC) and Meraki (acquired for $1.2B in cash, handful of posts on TC).

Or Facebook, mentioned CONSTANTLY on TechCrunch, which is currently at a market cap of $68 billion on the public exchange.

Or many startups that get mentioned once on TechCrunch and never again and then fail.

I agree that the scatterplot would be interesting, but I think you are supposing that the answer will come out the way you expect.

I think if you used TC mentions as a proxy for valuation you would overvalue consumer facing products versus say back office, network engineering or enterprise.

Apart from TC bias, it's also a reflection of marketing priorities. A "Foursquare" wants to get in front of everyone, a "Meraki" wants to target decision makers for infrastructure purchases.

I went to China to meet with tech firms, VCs and government officials. And to learn about the funding environment for Chinese firms investing in VCs. I know that Dave also met with LPs (who invest in in VC funds). But thanks for making the blind assumption about my trip and motives. Appreciate it.

Said the guy posting about taking several weeks off to go to China on a "tech tour". That seems like a massive boondoggle.

Mark was actually only there for the China part which was four days including weekend. He's actually highly interested in the business climate there and wants his kids to learn mandarin.

"massive boondoggle" because you were there and know what my business there was? I was there meeting tech professionals, VCs, government officials and investors in VC funds.

This problem might even be worse outside of the valley in places like Portland where I am writing from. They glamorize the valley lifestyle and act like they think all of silicon valley does.

Gosh I am so different. I drive an economy car and I try not to spend so much money and live within a budget. I don't pretend to be something I am not. What you see is what you get with me. I don't live a startup lifestyle, I try to live a minimalist lifestyle by making do with less. Sometimes less is more.

As an executive I'd even go for a lower salary just so the company can have a higher profit or pay employees better benefits. That is the way I'd run my startup lower executive salaries, higher worker salaries and more benefits to keep them on, and then a higher return for shareholders as well. If anything I might even go the Steve Jobs route of $1/year CEO salary and be paid in stock instead.

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