Forbes 30 Under 30… And Facing 30 Years Behind Bars
from the fetishizing-the-lone-entrepreneur dept
Back in 2016, around the time that both Theranos and Zenefits were engulfed in scandals that involved their superstar founders/CEOs being caught lying to investors, we had a podcast discussing the issues around innovation and the marketing mantra of “fake it ‘til you make it” for startups. One of the points raised is that there is a difference between outright fraud and the kind of usual puffery and exaggeration that happens in both startups, and that it’s important for startup founders not to get carried away.
Of course, we’ve seen many more examples that have crossed into the fraud category over the last few months, including a number of founders arrested and facing jail time, including FTX’s Sam Bankman-Fried, Ozy’s Carlos Watson, and Frank’s Charlie Javice. All three involved CEOs who had very much become the face of their companies, and two of them — Bankman-Fried and Javice — had been featured on the infamous “Forbes 30 Under 30” list.
The Guardian has an article calling out how notable it is that multiple “30 Under 30” winners ended up arrested. This line is really notable:
“The Forbes 30 Under 30 have collectively raised $5.3B in funding,” the tech entrepreneur Chris Bakke tweeted on Tuesday. “The Forbes 30 Under 30 have also been arrested for frauds and scams worth over $18.5B. Incredible track record.” The first number comes from Forbes and the second is Bakke’s own back-of-an-envelope calculation, but you get the gist: the line between innovator and fraudster seems to have become alarmingly thin.
The article makes a point that I think is legitimate and important, calling out the “fetishizing of youth.”
The problem here isn’t Forbes, of course; the problem is the vision of success that we’ve been sold and the fetishizing of youth. 30 Under 30 isn’t just a list, it’s a mentality: a pressure to achieve great things before youth slips away from you. The pressure can lead certain ambitious people to take shortcuts. And, in fact, shortcuts are encouraged: millennials, after all, grew up being told to “fake it ’til you make it”, cash in now until you become a withered, irrelevant, 30-year-old prune. If you exaggerate a little bit, that’s not fraud, that’s hustle! Until, of course, the justice department comes knocking.
I think there’s something to that, but also it’s combined with some other types of fetishization: including the myth of the lone genius who is also often described as “difficult to work with” and how such people are driving great innovations.
The reality, as always, is that big breakthroughs, great innovations, and a variety of other advancements come from a team of collaborators working together. It’s natural to focus on the person at the top, but when everyone gets too focused on just that one person, it creates a pretty combustible situation. Combined with awards like Forbes, and you create not just a set of expectations, but also an entire identity for the entrepreneur. You’re saying that they are defined by their entrepreneurial endeavors, and with it, by their success.
In such a world, failure is seen as an attack on their very identity, and that creates massive incentives to create shortcuts, which, when your in over your head, can eventually turn into outright fraud.
To be clear, Silicon Valley is one of the best places in the world at accepting entrepreneurial failures — often to the point of celebrating it and the lessons learned — but we should start to recognize that most of those celebrated failures tend to happen much more out of the limelight than in it. Thrusting people directly into the limelight too early has consequences.
And that’s not to place the blame on the media that held up these entrepreneurs as heroes. In most of these cases, you can see that the entrepreneurs sought out such accolades. Indeed, it’s almost a part of the “fake it ‘til you make it” bootstrap strategy: see what you can do to get fawning press coverage to bring in more business to cover over the fact that you don’t really have a sustainable operation.
Of course, much of this is human nature, so it’s not like it’s going to go away. But it does seem worth calling it out, if only to make some people be a little more cautious in celebrating the “lone entrepreneur” before they’ve actually done anything that shows a particularly sustainable or successful business.
Filed Under: 30 under 30, carlos watson, charlie javice, exaggerations, fake it 'til you make it, fraud, puffery, sam bankman-fried, scams
Companies: frank, ftx, ozy
Comments on “Forbes 30 Under 30… And Facing 30 Years Behind Bars”
I think the problem is absolutely Forbes and their ilk. I don’t expect journalists to be experts in the fields they cover, but they’re supposed to know enough about what they’re covering to understand whether it’s a bunch of bullshit or not. And if they don’t, they can contact people who do understand this stuff.
But they just don’t care.
Re:
They don’t care simply because it’s not in their best interests to. Especially for business-focused outlets like Forbes, their goal is to ride the coattails of people lucky enough to be in the right place, in the right time and have a lot of assets.
The likes of Forbes need to sell the idea that entrepreneurship and the rat race are still worthwhile pursuits, in an age where millennials across the US-China spectrum are collectively giving up. “30 under 30” and similar listicles are basically distractions, wild claims that people of the same age can “still make it” if they “pull themselves up by their bootstraps”, ignoring all the favorable conditions or how the sausage gets made… until someone blows the whole thing wide open.
Most honest observers would recognize that this sort of celebrity-focused culture is actively harmful and disingenuous – but nobody wants to hear it, because that’s what the corporate world needs: more faceless idiots running 9-to-5 menial jobs, being constantly told that prosperity is just around the corner if only they’d just burn themselves out a little more, stop asking inconvenient questions and trust in the system. Realistically, most people aren’t going to reach the “value” of Holmes or Bankman-Fried or Javice – and we should be recognizing that as a good thing for society. We don’t need rich celebrities taking up even more oxygen from the room, or people burning their lives away chasing unattainable goals.
Perhaps our faith in reputation is the problem.
Cuationary tales
“… it’s important for startup founders not to get carried away.”
Just ask Elizabeth Holmes.
I wonder how many people see the Forbes 30 under 30 as now being a curse!
Don't blame the media?
“And that’s not to place the blame on the media that held up these entrepreneurs as heroes.”
OMG!! “the entrepreneurs sought out such accolades”
Of course we should blame the media.
Much of the media has become a free PR tool because they don’t/won’t do their job – finding and telling the truth.
Check out John Oliver’s recent show for more and better examples. Hilarious and revealing.
Forbes is the problem
Forbes has become an enabler of many of these business frauds. No surprise, considering how Lewis D’Vorkin pivoted the erstwhile business publication to an SEO play.
https://www.cjr.org/business_of_news/la-times-lewis-dvorkin.php
Much of the content in Forbes is produced by contributors, unbound by editorial standards. One problem with the contributor pool is that their expertise derives from public relations, advertising and marketing and contributors are often close to the sources they cover — a clear conflict of interest.
Second, Forbes is aware that there is a cottage industry of SEO juicers, influencers and the like who charge good money to trade on Forbes’s reputation (i.e., pay hundreds of thousands for a contributor to get the publicity of “as seen in Forbes”) and get an article published. This gives the mirage of journalism.
*The problem here isn’t Forbes, of course; *
Yeah, no, Forbes is frequently full of shit.
another ruling like that
I remember a lawsuit against Corning (I think it was) and the judge ultimately ruled “over-optimistic forecasts do not rise to the level of fraud”.
Thin line?
“the line between innovator and fraudster seems to have become alarmingly thin.”
Or, it might be appropriate to say that Forbes due diligence when producing it’s 30 under 30 list is possibly the only thing thinner than the line between innovator and fraudster?
Speaking of fetishes, Mike’s hard-on for “innovation” should be added to the list.