It’s a question this 47-year-old found himself pondering even before reading Noam Scheiber’s delightfully well-written cover story in The New Republic. Scheiber finds an early-middle-aged entrepreneur from Boston, Nick Stamos, who had enjoyed modest success during his technology career but was unable to get Silicon Valley venture capitalists to back him. He concluded that the Sand Hill Road VCs are age-obsessed.
I’m not so sure.
He quotes various VCs who want to fund only youngsters as well as one of the most successful youngsters of our time, Mark Zuckerberg, blatantly opining that old people aren’t any good. (“Young people are just smarter.”) Scheiber sets out to debunk the “Silicon Valley mysticism” that young entrepreneurs produce an unfair share of “black swan” outcomes. In reality, it’s more complicated than that. Some of the biggest returns of all time have been companies started by the youngest of adults: Apple (AAPL), Microsoft (MSFT), Facebook (FB), Google (GOOG). The observation holds for the current crop of high-valuation darlings, including Dropbox, Box, and Airbnb.
But generalizations only go so far. WhatsApp, Twitter, and Cisco (CSCO) all were founded by more mature people. The same goes for Uber, whose CEO had been around the entrepreneurial block more than once.
The problem with building a thesis around ageism is that strong statements alone aren’t proof. Scheiber quotes Sequoia Capital’s Michael Moritz as a fan of investing in twentysomethings. “They have great passion,” Moritz says. “They don’t have distractions like families and children and other things that get in the way.” It’s a good quote, and Moritz likes to stir things up. But focusing on the quote ignores the more recent investments of Moritz and his partners, who made their bones on investments like Yahoo (yhoo) and Google. Sequoia backed Reid Hoffman at LinkedIn (LNKD) when he was an experienced thirtysomething with PayPal under his belt. The firm backed the middle-aged founders of WhatsApp. Moritz invested in Brian Sugar, CEO of PopSugar, who was an experienced technology executive before that venture. And a Moritz favorite is Jonathan Kaplan, whom he backed at Pure Digital (inventor of the Flip video camera, later sold to Cisco) and Melt, the grilled cheese and tomato soup company. Kaplan is — the horror! — about my age.
It’s true that many buzzy San Francisco and Silicon Valley companies have a frat-house/dorm-room vibe about them. Scheiber references Dropbox, and early Google is another good example. And yet the argument cuts both ways. Google, for all its institutional goofiness, has a phalanx of graying (and downright gray) senior engineers on its payroll; they appear to be some of the most important people at the company. Apple always has been a place that valued work over fun; that was true 30 years ago, and it’s true today. I recently visited the cutting-edge consumer products company Quirky in New York — I found it youthful but the antithesis of juvenile.
Some mature companies openly embrace the value of youth. Howard Schultz at Starbucks (SBUX), for example, recruited the then-late-twentysomething Clara Shih, who runs a social-marketing software company called Hearsay, to his board. The explicit reason was to get Shih’s “digital native” smarts into the boardroom. At the same time, Schultz wasn’t naïve about the limitations of someone so young. Shih told me Schultz suggested she have regular breakfasts before board meetings with the retired Pepsi executive Craig Weatherup, so he could mentor her on boardroom life.
As I said at the outset, Scheiber’s article is artfully written. I just have a hunch that his anecdotes were well selected to match his thesis, which is different than proving his thesis. At the end of the narrative we find entrepreneur Stamos upset that he can’t get the VCs to pay attention even as they lavishly fund (younger) competitors whose products are inferior to his. Reflecting on my 17 years covering Silicon Valley — no twentysomething tech journalist can start a sentence this way — I realize that I’ve heard these laments many times before. Over the course of the year there are thousands of Stamoses checking into the Sheraton Palo Alto, frustrated by their lack of ability to sway some arrogant VC who couldn’t be bothered to pay attention to their pitch.
And then there’s Stamos’s provenance: He’s from Boston. Had Scheiber set out to prove Silicon Valley’s discrimination against out-of-town entrepreneurs, he would have had a slam dunk on his hands. Because there’s no doubt the VCs of the Valley are prejudiced against Bostonians.