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The spirit of startups past

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Nine years ago, just about to the day, I left my job at the San Francisco Examiner — where I’d worked for, oh, nine years and a few months — to join the handful of people who at that time constituted Salon. We’ve been through a lot of different offices in our existence, starting out with rented space in a downtown architecture firm on Main St.; then to our first real digs in China Basin Landing, down the hall from Howard Rheingold’s Electric Communities and the old Well Engaged, but otherwise isolated from civilization by the vast tracts of empty space below Townsend Street that have since been crammed with development; then to the corner of Third and Mission, just upstairs from Rochester Big & Tall, a perfect perch from which to watch the dot-com bubble begin to inflate; then, aloft on that bubble ourselves, over to the top two stories of a fancier building on Fourth Street off Mission; then consolidating on one of those floors; then moving downstairs to our comfortable, slightly smaller digs in the same building.

During the bubble’s boom years we’d see, through the lenses of retracting elevator doors, the hustle of VC-inflated commerce on floor after floor of expensive office space. Then, from late 2000 on, we observed the gradual depopulation of those same floors, as one failed dot-com after another dismantled its cubicles and closed up shop.

In my current office, every time I lean back in my chair and stare at the ceiling I’m faced with a grim reminder of that era, a memento dot-com mori in black Smartie ink scrawled on an oh-so-fashionably exposed duct with the name of the company that preceded us in the space:

food.com on an air duct

I don’t know why it was important that these ducts be so labeled. It’s certainly not worth the effort to efface the writing. It’s just one of those little bits of office archaeology serving to remind you that we’re all just passing through. Still, I’m sort of grateful for it. As I read intimations of a new wave of speculative excitement in the industry, I lean back in my chair, let my eyes float up ductward, and vow, never again!

Bonus link: While we’re musing about the Internet Bubble, Paul Graham (of “Hackers and Painters”) has written a thoughtful essay on “What the Bubble Got Right.”

Priceless…

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In case you missed it, this gem appeared in the Friday Wall Street Journal in an article about the steady shift of the American economy’s transactions from cash or check to plastic:

  Some Christians see the pervasive use of plastic as part of a dark biblical prophecy. Pat Robertson, founder of the Christian Broadcasting Network, has said that plastic may signal the cashless society of the end times foreshadowed in the Bible. Mr. Robertson’s network accepts contributions from supporters on both Visa and MasterCard.

The end times, it seems, will be financed at a low introductory APR — but when the full rate kicks in, sinners beware!

Random notes

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I noticed with some amusement and glee on Monday that the Wall Street Journal published a list of the fastest-growing employment sectors in the latest jobs report, and what was at the head? “Internet content producer”! OK, it’s not 1999 all over again, and thank goodness for that; the actual number of new jobs in the field (2000) was small. But hey — after what this business has been through, any good news is good news.

I haven’t gotten it together to spend the money on one of those PC-to-stereo bridges that lets you stream music from your computer to your home audio systems, but when I do, I’ll look first and most closely at the Slim Devices Squeezebox — not only because it looks like a good product, but because the company that makes it lets anyone play with the open-source software that runs it: Slimserver. I’ve been having fun with Slimserver: You install it on the computer that has your music library and you can then access your library from any remote computer with a decent Internet connection. Requires a little effort to get the hang of it, then seems to work like a charm. A browser interface lets you control what’s playing. Very cool.

I’ve turned on “item level titles and links” in Radio Userland, so instead of handcoding my little headlines, they should appear in RSS 2.0 feeds as properly coded titles. You can do this too — just look under Radio’s preferences under “item level titles and links.” Thanks to Tim Bishop for the tip.

Another useful piece of open-source software I’m making a note of (thanks to Jon Udell for the pointer): Audacity, an audio-file editor.

Once more, into the bubble?

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With Google’s IPO filing Silicon Valley is crossing its fingers, praying that the event marks one of those epochal turns of the boom/bust cycle (like Netscape’s 1995 public offering) signalling a new technology-industry bonanza. Never mind the destructive consequences of the last turn of this wheel; everybody strap on your belts and jump on for another wild ride — after all, maybe you, too, will get rich!

I love using Google; I’m still proud to have been among the first technology writers to recommend it to my readers, back in late 1998, and for a long time I got e-mail from people thanking me for turning them on to it.

I’m also happy to see that Google has chosen to use a “Dutch auction” approach to pricing its IPO. Those of you with long memories may recall that Salon used a similar method in its 1999 IPO. (A Dutch auction IPO allows the stock offering’s price to be set by a complex but fair market process rather than by bankers sitting in a closed room trying to figure out how to price the stock so as to best enrich their pals.)

Google is a wildly different company from ours in many ways — and a lot more successful as a business! But the basic arguments they cite for the Dutch auction — the desire to level the playing field, to give small investors a chance to participate, and to avoid the sort of cronyism that gave boom-era IPOs a bad name once the market turned south — are the same ones that persuaded us to go that route five years ago. Salon took a lot of brickbats for the choice back then, so it’s nice to receive this kind of after-the-fact endorsement of our decision from such a significant player.

All that said, I’m kind of amazed at how eagerly some corners of the Valley seem to be anticipating a return to boom-era insanity. I’m crossing my fingers, too — praying that a successful Google IPO, which I certainly think it deserves, doesn’t spark a new round of stupid investments and “we’ll figure out the business model later” startups.

In the ’90s, many people had the excuse of youth and inexperience — they were building their first companies, and they’d never experienced a downturn. Today, the scars of the bust are still fresh. No one can plead ignorance. If we fail to make smart choices and build sustainable businesses that can support innovation rather than fuel get-rich-quick dreams, we have no one else to blame. Certainly not Google.

Greenspan, Bush and Social Security: Robin Hoods in reverse

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Alan Greenspan made everyone sit up and take notice yesterday by declaring that, since he thinks raising taxes is a bad idea, the only way to deal with the ballooning deficits the nation faces as the baby boomers retire is to cut Social Security benefits.

So there you have it, more starkly laid out than ever before, by the one voice in the national economy that everyone listens to. First we lowered taxes with a plan ridiculously weighted towards rewarding the extreme high end of wealthy citizens, while tossing a handful of crumbs to the middle class; now we’re told that we have to make up the difference by cutting retirement benefits for the mass of Americans.

Let’s be clear on a few things: I don’t feel that Social Security is a sacred cow that should never be reviewed, revisited or revised. Let’s talk about means tests, fixing the inflation indexing, whatever. There’s lots of room, and need, for good reform ideas. (The Bush privatization idea is not, however, one of them; putting aside the argument over whether it would offer good results, Bush has never explained how he intends to pay for it. Since the cash to pay for current retirees’ benefits comes from current wage-earners’ tax payments, if you put the current wage-earners’ payments into private accounts, you can’t pay the current retirees — and we’re right back to Greenspan’s talk of cutting benefits.)

But let’s not allow the most basic fact of this national debate to be obscured, either. Bush and Greenspan together are practicing a sick kind of reverse-Robin-Hoodism (or should it be hoodwinkery?). What we are witnessing is a gigantic transfer of cash from the pockets of the many to the pockets of the few. This isn’t just morally bankrupt — it’s pragmatically stupid, since in the long run it hobbles the economy.

Our memory span is so short that none of the media coverage of Greenspan’s speech that I saw bothered to review the basic history here: The U.S. had already had a plan in place to deal with the baby boom retirement! What do you think those surpluses we began to run up in the late 1990s were all about? That was the money that a bipartisan coalition of responsible Democrats and Republicans had — at considerable political cost to themselves — begun to sock away so that we could approach this demographic tidal wave with some degree of confidence.

Fast forward to the 2000 election: Remember George Bush’s absurd — but politically effective — argument about the surplus? He told us it was “our” money, not the government’s, and he wanted to give “us” some of it back. These are Bush’s words from that election: “Half the surplus is gonna go for Social Security reform and to pay down debt. One quarter is gonna go for new programs that are needed. But I think it’s fair, and I think it’s right, that one quarter go back to the hard working Americans who pay the bills.”

In hindsight, the distortions and outright lies rolled into that campaign statement are too tightly packed to pry apart: As it turned out, none of the surplus went toward Social Security reform or to pay down debt. Bush pushed through a series of tax cuts that reduced the tax burden on the wealthy while barely changing the tax situations of most “hard working Americans who pay the bills.” We encountered recession and war, and instead of facing up to tough fiscal choices, Bush kept telling us, “Just wait, the tax cuts will do their trick — the economy will grow, Americans will get back to work and the recovery will shave down the deficit.” None of that has happened, despite multiple waves of tax cuts. Instead, the deficits keep getting worse.

So now the other shoe drops: Whoops, says Alan Greenspan to middle America, George Bush wrecked your economy, the Republican Congress squandered the national piggy bank — now we’ll have to cut your retirement benefit! After all, isn’t it more important to protect billion-dollar estates from the “death tax” than to keep offering working retirees a reasonable pension?

There is one thing Greenspan has done here that the Bush administration will not forgive him for: He was supposed to wait till after the election to start talking about cutting Social Security. Before the election, this dose of truth-telling is a little too dangerous. People might actually start paying attention.

Fannie, Freddie

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If you’re like me, you’ve been unable to make much sense of the news trickling out about problems at Fannie Mae and Freddie Mac. A lot of us have a hard time just understanding what it is that these strange mortgage-market behemoths — government-sponsored corporations with the mission of increasing home ownership — do, let alone what they might have done wrong.

Mitch Ratcliffe has posted an intriguing analysis over at the new Red Herring, suggesting that the moves against Fannie and Freddie are part of a Bush administration political “payback”:

  The call for new regulation is, in part, payback from the Bush administration for crackdowns on industries with which the White House has close ties, particularly energy, where executives have ended up in court after alledgedly stealing billions of dollars from investors and partners. The message is: “If you want accountability, we’ll give you accountability.”

Round up the usual links

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Holidays allow for a certain amount of catchup reading. Here’s some of what I enjoyed:

Gary Wolf’s piece on the Dean campaign’s use of decentralized, Internet-style organization didn’t tell me anything I hadn’t gleaned already from decentralized reading — but it put all the pieces together beautifully, and should be required reading for those inside-the-Beltway pundits who still don’t understand what’s happening in their world.

If you want to understand what’s happening to the U.S. economy — for instance, why inflation is so low, and why jobs are so scarce — Charles Fishman’s piece on Wal-Mart in Fast Company is eye-opening. Since Wal-Mart is notoriously close-lipped, and so are the people who work with it, in order to put the story together, Fishman had to use the old reporting trick of finding sources among former employees of Wal-Mart partners. (Since the article’s point is that Wal-Mart’s demand for low prices sometimes drives its own suppliers out of business, there were more of these than might normally be typical.) The piece ends up portraying a company — “Wal-Mart in the role of Adam Smith’s invisible hand” — whose brutal efficiency at driving its suppliers’ prices down has served as an accelerator to globalization, a boon to consumers’ pocketbooks and a giant engine of economic dislocation for American workers. Classical economists would see nothing but good in the result. But the turbocharged displacement of livelihoods and corporate stability gives one pause.

For fun at the intersection of geek culture and high culture, there’s Alex Ross’s New Yorker piece on the subterranean kinship between “The Lord of the Rings” and Wagner’s “Ring” cycle. I don’t agree with everything Ross says but it’s a smart piece for those of us who are fans of both masterworks.

Finally, here’s a BBC story by a psychologist who claims that good luck isn’t a matter of luck at all. “My research eventually revealed that lucky people generate good fortune via four principles. They are skilled at creating and noticing chance opportunities, make lucky decisions by listening to their intuition, create self-fulfilling prophesies via positive expectations, and adopt a resilient attitude that transforms bad luck into good.” [Link courtesy Metafilter]

Happy New Year!

Google pump-and-dump or Microsoft FUD attack?

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The New York Times reported that Microsoft talked to Google about acquiring the company. Bill Gates denied the report. Who’s lying? Dan Gillmor walks us through the possibilities. Dan sounds like he thinks it’s more likely that the lie emanates from the Google side, since Gates, as a public-company chairman, has to follow some pretty strict rules — and the investors who are plotting an IPO for Google have a “pump and dump” incentive to talk up Google’s prospects.

I dunno. Google was a pretty hot item before anyone read any headlines about a Microsoft acquisition. Anything is possible here, but Microsoft has a long history of FUD — sowing “fear, uncertainty and doubt” — and concern about regulatory wrist-slaps would not seem high on the list in Redmond in the wake of the Bush administration’s roll-over-and-die approach to the Microsoft antitrust settlement.

Regulation — it works!

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It’s now been several weeks since the no-call list limiting telemarketers’ calls was put into effect, and guess what? Our household — which previously received on average of 2-3 telemarketing calls per weekday evening, inevitably ringing just when I’d sat down in front of a hot dinner or the kids were raising a ruckus in the bathtub or when we’d finally gotten them down to bed — has seen an approximately 99.9 percent reduction in the volume of telemarketing. I think we’ve received one call total, from our own phone company, which can claim it has an “existing business relationship” or whatever with us.

I consider this a major lifestyle improvement.