Commentary

Tearing Down The Candy Walls: Inside The Modern Start-up/ Sweatshop

Every industry has its absurdities, and also its cynical insiders who go on to reveal its secrets.

In his memoir “Adventures in the Screen Trade,” William Goldman famously summed up Hollywood — and also pretty much every other business entity around — by saying “Nobody knows anything.”

Nowhere is that case made more transparent (to use another meaningless buzzword) than in “Disrupted: My Misadventure in the Start-Up Bubble,” by Dan Lyons, which was released last month and is already a bestseller.

Lyons is in a position to know. “Unceremoniously dumped” as he puts it, as the technology editor of Newsweek (hey, dude, it was sold for a dollar!) the gray-haired, then 50-year-old father of young twins, with a wife who wasn’t working at the time, does what many out-of-work, former star reporters do: he joins the people on the other side of the curtain, in the booming wealth-making industry he used to cover (sometimes covetously.) He’s there for the money, thinking, “hey, how hard can this be?”

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In this case, he lands a job at HubSpot, a Boston start-up that sells cloud-based software to marketers. Located in a handsome, artfully restored, old red-brick-walled industrial factory, the company lives up to every cliché in the known digital world. (Beanbag chairs, nap rooms, free beer, rows and rows of earbud-wearing, low-paid Millennial slaves manning the galleys, etc.) Churn baby, churn.

The book is a fantastic read. Though it does bog down and get repetitive in the middle, seldom has the world of second-generation start-ups been described in a micro, day-by-day basis with such perceptive skill.

Actually, that’s not true either. The same sort of masterly observations are dramatized on HBO’s “Silicon Valley,” for which Lyons left HubSpot (also unceremoniously) to become one of the writers.

Set in Palo Alto but using the term “Silicon Valley” broadly, the nerd/bro-based show is hilarious, in a deadpan “Office Space” way that suggests it has to be a parody. But the sad thing is, it’s not even exaggerated.

In a writing room that also includes Dick Costolo of Twitter fame, Lyons is on board for Seasons 2 and 3. It seems he contributes some of the Orwellian nuggets freshly mined from this book, like using the term “graduated” for “fired.”

In an almost-daily happening at HubSpot, the whole company gets a peppy corporate email that announces “we are super excited to see what [graduated guy] does with his superpowers on his next rock star adventure.”

Also, since “unlimited vacation” is one of the perks, that means you don’t get paid for the days you never took while trying to make your impossibly punishing numbers.

Previously, as a tech writer at Forbes, Lyons got semi-famous writing the “Fake Steve Jobs” blog, which was so good that some thought it had to have been written by an Apple insider.

So there is no one in the known universe in a better position to skewer the mix of frat house/kindergarten/ Scientology culture that is the modern start-up.

Journalists are generally a dark, sardonic bunch, so I was beaming and nodding my head in “delightion” over what Lyons made of all the nonsense, group-think language.

Yes, “delightion” is one of the HubSpot co-founder’s favorite terms. Another is “one-plus-one equals three.” In meetings, HubSpot staffers would ask, “Yes, but is it one-plus-one equals three enough?”

This is the kind of stuff that makes your skin crawl if you’re not drinking the company Kool-Aid. Actually, I have had the same experiences interviewing some of these start-up guys (and they are nearly always guys.) I remember a terrible Emperor’s New Clothes moment, interviewing someone who was about to release one of the stupidest, most offensive Super Bowl spots of all time, and he didn’t have a clue.

Then again, Lyons himself can get mighty annoying. We hear that he used to work at Newsweek, wear a suit, have an office, and interview Bill Gates, a few too many times.

Yes, his talents and potential at HubSpot were horribly wasted and mismanaged. Still, the founders of the company took him in and paid him well.

It becomes clear that HubSpot is one of these second-generation start-ups that is hardly progressive or world-changing — it’s pretty much the opposite. Its pedestrian software is buggy, and no matter how many euphemisms you come up with for “spam,” that’s what they’re selling.

Rather, it exists more as a financial instrument, a sales and marketing operation that has to scale quickly, to get to an IPO for a several-billion-dollar valuation, while the company itself still operates in the red. So you inspire all the terribly paid sales and marketing serfs with company games, candy walls and orange hammocks to keep it going.

Lyons at one point testily says to one of the Millennials, “You guys are the first generation that’s willing to work for free candy. My generation would never have fallen for that. We wanted to get paid in actual money.”

She responds that candy doesn’t cost much, that she probably would not be paid more without it, and that it makes work fun. It’s hardly this kid’s fault that this culture exists, of having to endure a “tour of duty” with no security at all, and companies who have no idea how to manage, skirt the rules, and fire staff willy-nilly without appreciating their hard work or loyalty.

Still, after a while, you just want to shake this guy and say, “Hey, you’re staying there for the same reason that the higher-ups are pumping up the staff: for the money!”

In the end, HubSpot did go public, and Lyons ended up extracting about $60k from his shares. That’s lunch money by Wall Street standards, but to the rest of us working stiffs, it’s a pretty nice chunk of change to receive as gravy.

Lyons also makes terrible fun of the sad frat sales bros who are working the phones for chump change and free beer, in what are little more than ‘70s style call centers.

As a writer for HBO, Lyons lives in a much more exclusive world that’s no less bro-y. So he delights in the fact that the "Silicon Valley" show writers are obsessed with dick jokes.

So much so, in fact, that in the last episode I watched, they went to the trouble and expense of having a scene with actual equine intercourse happening in the background — and believe me, it’s quite a diversion. (I suppose it could be a metaphor for the flummoxed Richard character seeking out an answer from his race-horse-collecting new boss and not getting one.) Frankly, though, I found it gratuitous. This is the kind of stuff that only very privileged boys get to do.

But back to HubSpot. The most depressing takeaway is that in this new tech economy, a company doesn’t need to become profitable, or make anything that works very well. It just needs to get big fast, stage its initial public offering and pay out for investors — while the rest of us are left holding the bag, and waiting for the bubble to burst.

8 comments about "Tearing Down The Candy Walls: Inside The Modern Start-up/ Sweatshop".
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  1. Doug Garnett from Protonik, LLC, May 26, 2016 at 5:23 p.m.

    Nice analysis of a book we all should read (and I concur on the weaknesses).

    But I'd like to add that we need to project out a bit further:   In the media business, we need to transfer what he observes about HubSpot to become highly suspicious of new media endeavors AND of new AdTech ventures.

    There are valid, useful, good ones out there. But too many are digital "get rich quick" schemes - designed for the founders and early investors to cash out - without risk and often without doing anything of value.

    Yet the pages of AdAge and other industry magazines are filled with articles of wonder at new shiny digital baubles. It took Dan Lyons to show us they're not just distractions - but can be entirely designed to succeed through PR without delivering anything of significant value.

    So the next time someone offers an AdTech idea that sounds like EXACTLY what you wanted to hear, be skeptical. They're probably telling you just exactly what you want to hear - but not what the product would ACTUALLY do for you.

  2. Don Perman from self, May 26, 2016 at 6:41 p.m.

    A great read as ever: funny, enlightening and insightful. Plus, remarkably, it actually makes me want to read a whole book.   This is genuinely disruptive, given my ever-shorter attention span.  Thanks for this.

  3. Anglyn Hays from Free Lance Writer Hire Me!, May 26, 2016 at 7:38 p.m.

    I love sterotypes-on-sterotypes like this -- I only hope the author is in control, lol.  I am just north of this stereotype, and I assure you, not all millennials will gently into that good night, not at all.  And no one is reading Hollywood blurbs published in 1983.  Astonishing really.  And the band plays on.

  4. George Parker from Parker Consultants, May 26, 2016 at 8:47 p.m.

    Barbara, splendid "Four Seasons Worthy" column. Indeed a good book, even though it needs massive editing, but I wondered as I read it, why did he put up with these wankers for a cash out of a mere $60K. As I posted on AdScam today, I have to do a Captain Pickard Smack My Head moment to read that Hulu is now valued at $25 BILLION, and may I repeat may, generate a profit in 2020. Still, arithmatic was never my strong point.
    Cheers George

  5. Tom Siebert from BENEVOLENT PROPAGANDA, May 27, 2016 at 1:10 p.m.

    Read the book in a day. Not without flaws, but more literal LOL moments than any book I've read in years. It's smart as it is hilarious, too. A last-ditch Cassandra call before Dot-bomb 2.0, no doubt. 

  6. Christopher Mchale from Ikonik, May 27, 2016 at 1:56 p.m.

    Spam is in the user, not the software, and buggy it ain't, but more important, what else do you expect from a genration raised in the middle of a divorce epidemic, laid -off parents and fore-closed houses, sadldled with idiotic debt? Of course, candy tastes sweet. Dan's a funny guy but i think he looks at this from a warped and cynical and ultimately clueless perspective. Try seeing it from the young workers perspoective. They expect nothing and they got that expectation watching what happend to their familes. Or did Dan think there would bno consequence when an entire genrtion is subjected o the kind of crap milenials were? And I don't say that as a millenial. I'm an old guy. But I have my eyes open. Let's all stop pretneding nothing is happening beyond, oh those silly kids, setlting for candy.

  7. Barbara Lippert from mediapost.com, May 27, 2016 at 8:31 p.m.

    As for no one reading Hollywood blurbs publshed in 1983-- Anglyn, you should really check out William Goldman's work.  It's beautiful. 

  8. Paula Lynn from Who Else Unlimited, June 15, 2016 at 12:30 a.m.

    Who is buying all that crap ? The get rich quick schmucks who believe these double talking selfishie techies. Put 3 quarters in and get back 2. You win ! Snake oil sells. Anyone going to take Mr. Lyons first hand reveal to the bank ?

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