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