On a 1910 trip to Paris, Theodore Roosevelt delivered his famous speech about “The Man In The Arena,” which has since been widely adopted by a very specific kind of Silicon Valley cretin. It’s quite a long speech, but here’s the part that they love to share:
It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows the great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.
Roosevelt’s speech, given a year after he’d left office, was not about funding startups or building software, but the concept that citizens should work together for a better world and a better country. In fact, the quote about the fact that “it is not the critic who counts” refers specifically (according to historian Michael Patrick Cullinane) to those who “express contempt” or hostility “to other citizens of the republic,” which Cullinane summarizes as the “demagogue who breeds factions among us.”
The most notable charlatan to misquote the Man In The Arena is Chamath Palihapitiya, a former Facebook executive and venture capitalist whose hits include Facebook Beacon (Facebook was sued $9.5 million for selling user data from Beacon), Facebook Home (the basis of the failed HTC Facebook phone), effectively disappearing from his own venture capital firm, and making $750 million by taking lossy, shitty companies public via Special Purpose Acquisition Companies (SPACs, a shell corporation that exists to acquire a company and take it public), dumping his shares and watching as the companies in question tumbled in value. To quote Eric Newcomer:
He has said he made roughly $750 million by throwing his reputation behind the stocks, taking them public via SPACs that he helmed, and then selling shares on the public markets. He hyped the stocks, he sold his shares, and he made a profit while the retail investors who trusted him lost money. And the reality is that Palihapitiya got away with it. He’s boastfully summering in Italy and reveling in his luxurious wedding on the All-In Podcast that he hosts. Elon Musk and Grimes were apparently in attendance.
Palihapitya is also well-known for riding the January 2021 Gamestop short squeeze in a very public fashion, buying over $100,000 worth of call options when the stock was halfway through its orbital climb and cashing out before the markets imploded — which was caused, in no small part, due to the interference of retail trading platforms like Robinhood. Although he claims to have donated his profits (plus his original position) to charity, he was nonetheless a major cheerleader for the stock squeeze, in which an unknowable number of retail investors lost money. His actions were characterized by investor David Einhorn — a man best known for shorting Lehmann Brothers before the 2007 banking crash — as “pouring jet fuel” on the squeeze.
Last week, Palihapitiya responded to an aggrieved investor in SPAC Virgin Galactic (down from $11.75 on its debut in October 2019 to $2.72 as of writing this sentence) that he should’ve sold earlier, and responded to the (fair) accusation that he’s a pump and dump guy that he is “in the arena trying stuff.” In this case, I assume “stuff” means “losing 90% of the market capitalization of the companies he’s taken public.”
While I could judge Palihapitiya with my own words, Roosevelt’s own work aptly states that:
[a] man who, for any cause for which he is himself accountable, has failed to support himself and those for whom he is responsible, ought to feel that he has fallen lamentably short in his prime duty.”
Palihapitiya is symbolic of a special kind of poison running through the veins of Silicon Valley, where venture capitalists and founders believe that participating in the economy in some way is some act of heroism. They dress founding or investing in tech companies as something akin to a “Hero’s Journey,” where only those developing software (and those who invest as a result) truly understand the colossal burden of the valley, where naysayers are “part of a cult” and critics are “just trying to make themselves feel better.”
While there are those in the valley who are aware that they build stuff on the computer and that said stuff is valuable to someone, there are far too many others who consider software and technology to be some superior industry that elevates their status above regular working stiffs.
The Valley has become beholden to the Dunning-Kruger effect, where the most successful tech podcast is run by three guys who made their money over a decade ago and now believe that said success allows them to judge the efficacy of the Ukraine War or responsibly host an anti-vax conspiracy theory-espousing lunatic.
These are not “men in the arena.” They are the men in the expensive seats watching, yelling “I could’ve totally taken that guy” from a place where they will never face strife or struggle.
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The Cult of The Valley
This is the natural endpoint of twenty years of the media’s love affair with the “genius tech founder” persona. Society has all but ignored Steve Jobs’ abusive and vile personality, Zuckerberg’s theft of intellectual property and manipulation of users for profit, Travis Kalanick’s creation of an app-based underclass of labor, and almost everything about Elon Musk because they “built things,” even if that isn’t really true.
As Paris Marx put it, the remarkable amount of things that Musk has gotten away with are indicative of a fundamental flaw in the media’s coverage of the wider tech industry — that “it is in the nature of business journalism to assume that CEOs of public companies are not lying all the time.”
The valley’s valorization of “disruption” — a euphemism for destruction — allows bad people to keep winning. Ryan Breslow founded Bolt, an e-commerce company, and raised nearly a billion dollars in investment (including from Peter Thiel) through embellishing metrics, misleading customers about their ability to integrate with the platform, and outright lying about whether a client used its software. And despite an SEC investigation into Breslow’s communication with investors, Breslow is now the CEO of a wellness startup called Love, which received a splashy Forbes story and is in the process of raising a $40 Million fund, with Forbes calling him a “controversial founder” rather than the more apt “manipulative liar and person of interest in an ongoing SEC investigation.”
While one can faint upon the chaise of “innocent until proven guilty,” any logically-run industry would outright reject Breslow. Lawyers, doctors, and accountants must prove that they are of sufficiently good character to work in their chosen field. It’s for that reason why, almost twenty years after the fact, Stephen Glass — a one-time rising star in the journalism field who fabricated dozens of articles for The New Republic, Harper’s Magazine, Rolling Stone, and WNYC’s This American Life — still cannot be admitted to the California Bar, despite living an otherwise decent life and voluntarily making restitution to his former victims.
The Times investigation into Breslow and Bolt is damning, well-sourced and lays out the story of a cocky deceiver that would “over-zealously” tell a reporter incorrect numbers, outright lie to customers (leading to a costly lawsuit that his follow-on CEO would have to fix).
And yet, he’s fine. Ryan Breslow found another job, raised more money, and got more press despite being a con artist. And it’s because we have still, as a society, bought the lie that there is something special about startup founders — that they are able to get away with things because you can’t make an omelet without breaking some eggs.
This is what happens when you build an industry to fund and support a very specific kind of guy and an even more specific kind of narrative. When you valorize the process of founding and funding a company without valorizing the actual output — the true difference it makes to the world — you effectively frame “success” as “media hits and money.” The vacuous cryptocurrency boom of late 2020 through late 2022 was its most vulgar, aggressive form, with empty-headed valley conspirators like Chris Dixon and Sam Lessin mumbling meaningless nonsense about “decentralization” to try and gloss over the fact that they effectively removed any of the value creation of venture capital other than that which they delivered to limited partners and their own firms.
The current AI boom — while there are actual use cases, somewhere — feels so similar because of how unerringly vapid the conversation has become, with so few actual examples of AI making our lives measurably better. Much like cryptocurrency, the AI conversation almost always discusses what might happen rather than what is happening, making any normal person ask the question “why did venture invest $15 billion in something you can’t really describe?” The argument, of course, is that AI is “in its early days,” the same noxious defense that was used for cryptocurrency — which had also been around for many years before its venture-backed boom.
Silicon Valley has ultimately become beholden to venture investment, which has in turn created an incentive to resemble a certain type of founder or a certain type of company. When these investments succeed — either through raising a big round, garnering media attention, or experiencing a liquidity event — investors begin to favor similar-looking investments and resemble the venture capitalists that invested in them. The result is that the valley begins to experience a form of intellectual inbreeding, where venture capitalists fund their own biases, which in turn creates a culture within founders to resemble said biases, which leads to a monoculture shaped by money.
Instead of blazing a trail to the future, the Valley has created its own digital Habsburgs. These are the people that want to control the future of our genetics, put chips in our brains, make us live longer on their terms and build our cities in their image — a conveyor belt of mediocre men who have convinced themselves they’re gods.
And the real reason it happens is because there are too many wealthy people that are not, in fact, the Man in the Arena. The outsized power that venture holds over the actual creation of value within the startup ecosystem means that those writing the checks are too commonly separated from solving actual problems, meaning that they cannot perceive which ones actually exist.
Being the first money in a company that is worth $25 billion is not indicative of your ability to do anything other than write a check, nor does founding and selling a company 15 years ago demonstrate that you know how to build a city or combat a global pandemic.
The tech industry has convinced itself of its heroism at a time when the villains are winning. An industry where David Sacks, Chamath Palihapitiya, Jason Calacanis, Elon Musk, and Marc Andreessen lead the conversation is not one to be proud of, resembling the opening of a dystopian sci-fi more than any fanciful lie about utopias powered by AI.
This industry is tolerant of the most noxious right-wing demagoguery, all while working as hard as it can to try and commoditize labor. The valley is consistently failing to fight for the rights of anybody or anything who isn’t rich — or could be rich in the future.
A logical industry would have chased Palihapitiya out of town for what amounted to a large-scale swindle of retail investors. But then again, they didn’t blink when Andreessen Horowitz repeatedly dumped its crypto investments onto the markets, leaving other (predominantly retail) investors to pick up the bag. Who cares, as long as the “smart guys” profit?
If the valley can’t be a force for good, it can at least be the gateway to the future that it is allegedly meant to be. Doing so would require a vast reevaluation of what the tech industry does for society, and the courage to stand up against a regressive monoculture that spells to drag the entire industry — if not the world — into darkness.