11/3/2017 Pocket: How to end the tech culture wars: Ben Horowitz on the future of the Internet economy

How to end the tech culture wars: Ben

Horowitz on the future of the Internet
economy
By Andrew Leonard, www.salon.com
March 22nd, 2014

A leading Silicon Valley venture capitalist suggests how to make a

better future for more than just the super-rich

Ben Horowitz
Photo by: ( Reuters/Stephen Lam)

I dont normally review books on business management. Its not an area that either I or
Im just guessing the typical Salon reader is particularly interested in. But when a
PR person representing venture capitalist Ben Horowitz contacted me to see if I was
interested in an interview with the author of The Hard Thing About Hard Things:
Building a Business When There Are No Easy Answers, I jumped at the chance.

Horowitzs VC rm, Andreessen Horowitz, is at the front lines of the current tech boom,
investing in companies both big (Facebook, Twitter, Groupon) and about-to-be-big
(AirBnB, Coinbase, Pinterest, Foursquare, Jawbone). Horowitzs Bay Area tech economy
pedigree goes way back he was an executive at Netscape, which means he was
present at the creation of the dot-com boom. He even enjoys the rare honor of having
successfully steered a late 90s startup (LoudCloud/Opsware) through the rst crash. In
other words, hes not a newbie.

The grandson of Communists who was raised in Berkeley, a guy who comes by his
passion for hip-hop as honestly as any white-boy tech mogul can claim, Ben Horowitz
seemed to me like the perfect person to chat with about how the tech economy is and
isnt serving the needs of consumers and the wider society.

https://getpocket.com/a/read/575623276 1/4
11/3/2017 Pocket: How to end the tech culture wars: Ben Horowitz on the future of the Internet economy

Of course, it was only fair to read the book and talk a little about the topic of how to be
an e ective CEO when everything around you
1 Item is devolving into chaos, but Horowitz
added
didnt appear to mind when I kept steering the conversation toward larger questions.
The tech economys impact on society is, as he acknowledged, the topic of the day.

Theres a section in your book called Preparing to Fire an Executive. Thats not a
situation that most people are ever going to nd themselves in. Why did you write this
book? Who were you writing it for?

When I was a CEO, the books on management that I read werent very much help after
the rst few months on the job. They were all designed to give you directions on how
not to screw up your company. But it doesnt take long before you get beyond that and
youre like OK Ive screwed up my company; now what do I do? Most books on
management are written by management consultants, and they study successful
companies after theyve succeeded, so they only hear winning stories.

Your book arrives at a time and in a place where the debate about the impact of tech
economy wealth on society is extraordinarily heated. Your own company, Andreessen
Horowitz, is right in the middle of this, funding the companies that are remaking San
Francisco and the world. But your contribution is a book about how to be a CEO
during tough times. How does that plug into this larger debate?

I think it has humanized and given some depth and color to what the company-building
process is like. Because the terms of this debate have gotten completely cartoonish, both
from the detractors and the advocates of the tech economy.

On the advocate side, everybodys claiming that their company is making the world a
profoundly better place. Its bizarre when you hear some of these narratives, youre
like, really? Thats making the world better? But then on the detraction side its just
programmers gone wild and theyre all kids in Ferraris, and thats not really true either.

I do think were in a brave new world. When I started out, technology companies used
to sell technology to technology people. You built a disk drive and sold it to a PC
company, or you built a computer and you would sell it to a big business. In the last ve
to ten years, technology companies have become focused on consumers, and the
technology has gotten to the point where a software-based company can go in and
challenge an existing industry like taxis or hotels.

Thats changed everything. Its changed the amount of money involved, its changed the
job-displacement physics, and it has become super-emotionally heated. Its something
that we think about a lot here, trying to understand. Its de nitely a big thing.

You could argue that Netscape started that consumer-facing change, couldnt you?

Thats right. It was sort of the rst one. Now the genie is way out of the bottle.

Im interested in your perspective on how the industry has changed over time in the
Bay Area. In the 90s, it seemed to me that a lot of the people building the Internet
economy were originally geeks and nerds who were kind of surprised to see what

https://getpocket.com/a/read/575623276 2/4
11/3/2017 Pocket: How to end the tech culture wars: Ben Horowitz on the future of the Internet economy

they were passionate about suddenly become big business. Now it seems like people
are drawn to the tech economy here primarily
1 Item addedbecause they want power and money.
Its a di erent culture, and its rubbing a lot of longtime residents the wrong way.

That actually rst happened in 1999 and then it stopped. They all came out here and
then they all left because it all turned to crap. So this is the second time Ive seen it.

One of the things I talk about in the book is having the right kind of ambition. Why
people are here is becoming a bigger and bigger question these days. It is hard to build a
really big company if you have too many people who take a very self-centric view. If
people are there for all the wrong reasons, it can degenerate into a nasty situation.

I do think a lot of people are trying to do important things still, and I think it is really a
great thing that entrepreneurship is getting easier. When I started it was just much
harder to begin a company. That narrows the scope of what people will attempt and it
rules out most people under 30. The bad thing about young people starting a company is
that sometimes they do it for the wrong reasons or because they have the wrong skill
set, but the good thing is that they dont have any of the old paradigms baked into them,
so they have a lot of the bright new ideas that are harder to come by as you get older.

So what do you tell these youngsters who come to you looking for funding? Whats
your most important lesson?

There isnt one lesson that solves everything. One of the biggest things is to just think
for yourself. That is the distinguishing characteristic of the great entrepreneurs. Take
Mark Zuckerberg. One key to his success is that he really didnt listen to people if he
thought they were wrong, and that includes his own sta ! A lot of building a company
is, you really have to think for yourself and you really have to believe in what you
believe in and thats the only way through.

Is there a danger there that that necessary self-con dence turns into entitlement and
arrogance?

Yes. Theres no question that there is that danger.

So, 20 years ago, when you were at Netscape and I was downloading each new beta of
the Netscape browser the second it was available, I did not anticipate that after 20
years of amazing technological progress, wages would be stagnating and income
inequality would be growing and society at large would be increasingly questioning
whether, on net, all this innovation was a good thing. Youve been in the middle of it,
youve helped create this brave new world. Where do you stand on these larger issues?

Those are good points, but I do think you have to take a global view In the developed
world, what you say is totally true; weve got this big income gap and so forth. But one
of the things thats happened since the Internet arrived and helped accelerate the
process of globalization that is amazing and positive is the rise of the global middle class.
The number of people who have moved into what we would call the middle class up
from a dollar a day is just astounding

https://getpocket.com/a/read/575623276 3/4
11/3/2017 Pocket: How to end the tech culture wars: Ben Horowitz on the future of the Internet economy

[Intel CEO] Andy Grove had this great line where they asked him: Is the microprocessor
good or bad? and he says, Well, I dont1 think that is the right question. Its like asking if
Item added
steel is good or bad. It just is. Once it is invented its there.

I think the Internet is a lot like that. Its here. Obviously, if we have a globalized world
through the Internet, we have to rethink everything from employment to income
equality. San Francisco has become this huge lightning rod for this.

One of the things that fascinates me is the di erence between San Francisco and Silicon
Valley. Because in Silicon Valley, the only culture is the tech culture, but in San
Francisco there is a culture and a tech culture and they are not integrated. One simple
but very powerful thing that needs to happen in my view is just integrating the two
cultures in San Francisco. Tech people need to get more involved, they need to
understand the problems they are creating. The complete lack of mixing between the
two cultures is a very dangerous thing. And then there is the whole issue of appropriate
government policies to deal with these problems. Were in the pretty early days so I
dont know if I have good answers on that, but it is de nitely a big deal. And the changes
are not slowing down in the short term.

You start o a lot of the chapters in your book with hip-hop lyrics, and that got me to
thinking: In the last 15 years, the percentage of African Americans living in San
Francisco has plummeted. What would Public Enemy say about living in San
Francisco in 2014?

You know, all the best hip-hop that came out of New York was when New York was a
pretty bad city. Now that it has become a much safer place, the hip-hop is not nearly as
good. But one of the problems thats most infuriating to me in San Francisco, and that
doesnt get much attention, is that the restrictions on building are really just there to
protect the rich property owners.

If you are rich and you own a house or an apartment building, then you dont want
anybody building any more. But San Francisco is just one-third as dense as Brooklyn,
and thats just crazy. If you just said lets build it up to Brooklyns density you could slow
the rise of housing costs for many years.

It is such a logical thing to do, because people who own property arent actually adding
any value, they arent doing any work, they arent starting companies, they arent
creating new jobs. We ought to x things that can be changed without really hurting
anybody, like Proposition 13. Prop 13 should be repealed. I dont add any value to the
world by owning an expensive house, so I ought to pay a high tax on that. Thats the
best kind of tax, just paying for being a fat cat, as opposed to taxing someone who is
working or trying to build a company, or trying to support their family. There are a lot
of stupidly easy obvious policy decisions that could improve things a fair amount.

https://getpocket.com/a/read/575623276 4/4