What I am reading now following my recent post The Complexity and Beauty of Innovation according to Walter Isaacson is probably much better known: Innovation in Silicon Valley at the time of Silicon – Fairchild, Intel and the other Fairchildren. I have my own archive, nice posters from those days, one about the start-up / entrepreneur genealogy, with a zoom on Fairchild and one on Intel and one about the investor genealogy
Entrepreneurs…
“There were internal problems in Palo Alto. Engineers began defecting, thus seeding the valley with what became known as Fairchildren: companies that sprouted from spores emanating from Fairchild.” [Page 184] “The valley’s main artery, a bustling highway named El Camino Real, was once the royal road that connected California’s twenty-one mission churches. By the early 1970s – thanks to Hewlett-Packard, Fred Terman’s Stanford Industrial Park, William Shockley, Fairchild and its Fairchildren – it connected a bustling corridor of tech companies. In 1971, the region got a new moniker. Don Hoefler, a columnist for the weekly trade paper Electronic News, began writing s series of columns entitled “Silicon Valley USA,” and the name stuck.” [Page 198]
… and Investors
“In the eleven years since he had assembled the deal for the traitorous eight to form Fairchild Semiconductors, Arthur Rock had helped to build something that was destined to be almost as important to the digital age as the microchip: venture capital.” [Page 185] “When he had sought a home for the traitorous eight in 1957, he pulled out a single piece of legal-pad paper, wrote a numbered list of names, and methodically phoned each one, crossing off the names as he went down the list. Eleven years later, he took another sheet of paper and listed people who would be invited to invest and how many of the 500’000 shares available at $5 apiece he would offer to each. […] It took them less than two days to raise the money. […] All I had to tell people was that it was Noyce and Moore. They didn’t need to know much else.” [Pages 187-88]
The Intel culture
“There arose at Intel an innovation that had almost as much of an impact on the digital age as any [other]. It was the invention of a corporate culture and management style that was the antithesis of the hierarchical organization of East Coast companies.” [[Page 189] “The Intel culture, which would permeate the culture of Silicon Valley, was a product of all three men. [Noyce, Moore and Grove]. […] It was devoid of the trappings of hierarchy. There were no reserved parking places. Everyone including Noyce and Moore, worked in similar cubicles. […] “There were no privileges anywhere” recalled Ann Bowers, who was the personnel director and later married Noyce, [she would then become Steve Jobs’ first director of human resources] “we started a form of company culture that was completely different than anything that had been before. It was a culture of meritocracy.
It was also a culture of innovation. Noyce had a theory that he developed after bridling the rigid hierarchy at Philco. The more open and unstructured a workplace, he believed, the faster new ideas would be sparked, disseminated, refined and applied.” [Pages 192-193]
In his introductory article about the course he is giving at Stanford, Reid Hoffman convincingly explains why Silicon Valley still leads in high-tech innovation: Silicon Valley is no longer unique in its ability to launch startups. Today, many parts of the world are rich in all of the necessary ingredients. There are bright young technical graduates from universities around the world. Venture capital has gone global. And, technology companies have R&D centers in many areas of the world. There has even been a global expansion of some of the more subtle elements such as a culture acceptance of the potential failure of bold ventures. And, the belief in entrepreneurship is spreading everywhere in the world — creating a receptive culture in many cities. So, why does Silicon Valley continue to produce so many industry-transforming companies? The secret has moved past startups to scaleups.
The Innovators by Walter Isaacson is a great book because of its balanced description of the role of geniuses or disruptive innovators as much as of teamwork in incremental innovation. “The tale of their teamwork is important because we don’t often focus on how central their skill is to innovation. […] But we have far fewer tales of collaborative creativity, which is actually more important in understanding how today’s technology evolution was fashioned.” [Page 1] He also goes deeper: “I also explore the social and cultural forces that provide the atmosphere for innovation. For the birth of the digital age, this included a research ecosystem that was nurtured by the government spending and managed by a military-industrial collaboration. Intersecting with that was a loose alliance of community organizers, communal-minded hippies, do-it yourself hobbyists, and homebrew hackers, most of whom were suspicious of centralized authority.” [Page 2] ”Finally, I was struck by how the truest creativity of the digital age came from those who were able to connect the arts and sciences.” [Page 5]
The computer
I was a little more cautious with chapter 2 as I have the feeling that the story of Ada Lovelace and Charles Babbage is well known. I may be wrong. But chapter 3 about the early days of the computer was mostly unknown to me. Who invented the computer? Probably many different people in different locations in the US, the UK and Germany, around WWII. “How did they develop this idea at the same time when war kept their two teams isolated? The answer is partly that advances in technology and theory made the moment ripe. Along with many innovators, Zuse and Stibitz were familiar with the use of relays in phone circuits, and it made sense to tie that to binary operations of math and logic. Likewise, Shannon, who was also very familiar with phone circuits, would be able to perform the logical tasks of Boolean algebra. The idea that digital circuits would be the key to computing was quickly becoming clear to researchers almost everywhere, even in isolated places like central Iowa.” [Page 54]
There would be a patent fight I did not know about. Read pages 82-84. You can also read the following on Wikipedia: “On June 26, 1947, J. Presper Eckert and John Mauchly were the first to file for patent on a digital computing device (ENIAC), much to the surprise of Atanasoff. The ABC [Atanasoff–Berry Computer] had been examined by John Mauchly in June 1941, and Isaac Auerbach, a former student of Mauchly’s, alleged that it influenced his later work on ENIAC, although Mauchly denied this. The ENIAC patent did not issue until 1964, and by 1967 Honeywell sued Sperry Rand in an attempt to break the ENIAC patents, arguing the ABC constituted prior art. The United States District Court for the District of Minnesota released its judgement on October 19, 1973, finding in Honeywell v. Sperry Rand that the ENIAC patent was a derivative of John Atanasoff’s invention.” [The trial had begun in June 1971 and the ENIAC patent was therefore made invalid]
I also liked his short comment about complementary skills. “Eckert and Mauchly served as counterbalances for each other, which made them typical of so many digital-age leadership duos. Eckert drove people with a passion for precision; Mauchly tended to calm them and make them feel loved.” [Pages 74-75]
Women in Technology and Science
It is in chapter 4 about Programming that Isaacson addresses the role of women. “[Grace Hopper] education wasn’t as unusual as you might think. She was the eleventh woman to get a math doctorate from Yale, the first being in 1895. It was not at all uncommon for a woman, especially from a successful family, to get a doctorate in math in the 1930s. In fact, it was more common than it would be a generation later. The number of American women who got doctorates in math during the 1930s was 133, which was 15 percent of the total number of American math doctorates. During the decade of the 1950s, only 106 American women got math doctorates, which was a mere 4 percent of the total. (By the first decade of the 2000 things had more than rebounded and there were 1,600 women who got math doctorates, 30 percent of the total.)” [Page 88]
Not surprisingly, in the early days of computer development, men worked more in hardware whereas women would be in software. “All the engineers who built ENIAC’s hardware were men. Less heralded by history was a group of women, six in particular, who turned out to be almost as important in the development of modern computing.” [Page 95] “Shortly before she died in 2011, Jean Jennings Bartik reflected proudly on the fact that all the programmers who created the first general-purpose computer were women. « Despite our coming of age in an era when women’s career opportunities were generally quite confined, we helped initiate the era of the computer. » It happened because a lot of women back then had studied math and their skills were in demand. There was also an irony involved: the boys with their toys thought that assembling the hardware was the most important task, and thus a man’s job. « American science and engineering was even more sexist than it is today, » Jennings said. « If the ENIAC’s administration had known how crucial programming would be to the functioning of the electronic computer and how complex it would prove to be, they might have been more hesitant to give such an important role to women.” [Pages 99-100]
The sources of innovation
“Hopper’s historical sections focused on personalities. In doing so, her book emphasized the role of individuals. In contrast, shortly after Hopper’s book was completed, the executives at IBM commissioned their own history of the Mark I that gave primary credit to the IBM teams in Endicott, New York, who had constructed the machine. “IBM interests were best served by replacing individual history with organizational history,” the historian Kurt Beyer wrote in a study of Hopper. “The locus of technological innovation, according to IBM was the corporation. The myth of the lone radical inventor working in the laboratory or basement was replaced by the reality of teams of faceless organizational engineers contributing incremental advancements.” In the IBM version of history, the Mark I contained a long list of small innovations, such as the ratchet-type counter and the double-checked card feed, that IBM’s book attributed to a bevy of little-known engineers who worked collaboratively in Endicott.
The difference between Hopper’s version of history and IBM’s ran deeper than a dispute over who should get the most credit. It showed fundamentally contrasting outlooks on the history of innovations. Some studies of technology and science emphasize, as Hopper did, the role of creative inventors who make innovative leaps. Other studies emphasize the role of teams and institutions, such as the collaborative work done at Bell Labs and IBM’s Endicott facility. This latter approach tries to show that what may seem like creative leaps – the Eureka moment – are actually the result of an evolutionary process that occurs when ideas, concepts, technologies, and engineering methods ripen together. Neither way of looking at technological advancement is, on its oqn, completely satisfying. Most of the great innovations of the digital age sprang from an interplay of creative individuals (Mauchly, Turing, von Neumann, Aiken) with teams that knew how to implement their ideas.” [Pages 91-92]
Google about Disruptive and Incremental Innovation
This is very similar to what I read about Google and posted recently in The Importance and Difficulty of Culture in Start-ups: Google again…: “To us, innovation entails both the production and implementation of novel and useful ideas. Since “novel” is often just a fancy synonym for “new”, we should also clarify that for something to be innovative, it needs to offer new functionality, but it also has to be surprising. If your customers are asking for it, you aren’t being innovative when you give them what they want; you are just being responsive. That’s a good thing, but it’s not innovative. Finally “useful” is a rather underwhelming adjective to describe that innovation hottie, so let’s add an adverb and make it radically useful, Voilà: For something to be innovative, it needs to be new, surprising, and radically useful.” […] “But Google also releases over five hundred improvements to its search every year. Is that innovative? Or incremental? They are new and surprising, for sure, but while each one of them, by itself is useful, it may be a stretch to call it radically useful. Put them all together, though, and they are. […] This more inclusive definition – innovation isn’t just about the really new, really big things – matters because it affords everyone the opportunity to innovate, rather than keeping it to the exclusive realm of these few people in that off-campus building [Google[x]] whose job is to innovate.” [How Google Works – Page 206]
I was in Eindhoven today for the great EVP program (20 young entrepreneurs from 4 European technical universities spent two weeks on four campuses developing their projects). I had two inspiring moments: 1st the mayor of Eindhoven had a great speech about the importance of innovation and entrepreneurship. 2nd we had a meeting of 20+ people debating about how to foster entrepreneurship in universities.
Eindhoven’s efforts for entrepreneurship and innovation
The mayor of Eindhoven, Rob van Gijzel, explained that Philips had been nearly everything for Eindhoven for decades (jobs of course, schools, hospitals, PSV…) but a lot of the jobs have been delocalized, and Philips has struggled. He mentioned that the life expectancy of Fortune 1000 companies has gone from 70 years to 12 years (these are notes so I may be wrong with my recollection of facts, but the spirit was it) and the life expectancy of a product is 2 years.
So as a mayor, it is his mission to think about the future, not the present only. Eindhoven still strives because it has NXP and ASML (Spin-off from Philips), because they have the largest Samsung R&D center outside of Korea, and an antenna of the Singularity University. Rob van Gijzel unusually knows a lot about technology for a politician! Maybe it’s because it is Eindhoven… and Eindhoven is putting a lot of energy and money in universities, accelerators, start-ups and the unique high-tech campus Eindhoven (www.hightechcampus.com) which hopefully will create a lot of high value jobs. Big established companies, SMES, start-ups and universities seem to work together in the same direction. I am sure it is not perfect, but the effort is impressive!
Eurotech about Entrepreneurship
My second moment of inspiration was during a meeting of Eurotech about entrepreneurship. For once, it was not about the usual start-ups vs. SMEs, fast growth vs. controlled growth, but we had a great discussion about how to really help students interested in start-ups, about what is important, exposure to or teaching of entrepreneurship,
Just a few notes:
“early on you find inspiration, you are interested and you go where the crazy people are” … “it was the thing to do” …“I was an entrepreneur because my mother pushed me to be responsible and independent, then I tried, and failed twice, and then succeeded once”.
It is a long term effort, you teach, you expose, you inspire, and “you infect them with the virus” with possibly a long incubation. But should we do it early or late, compulsory or elective, filter the good entrepreneurs or expose/teach everyone…
“You need to teach entrepreneurship outside of the class…”
So you need a friendly ecosystem, where the university has its role (unclear which exactly, but it has one!) “Young entrepreneurs should know they do not need to pay for lawyers, they need to find friends who are lawyers, or who have a legal expertise.” You need to break the barriers, help people meet and find the people they need, also break the regional barriers because regional support focuses on local development, which is not necessarily the best friend of an entrepreneur who needs to think globally. Ecosystems have to be open, people need to travel, where the talent and money are
So we agreed there was not a general agreement on the strategic way of fostering entrepreneurship…though it is very important…
Occasionally, I write a short post that has nothing to do with the start-up. Well maybe it has… I was listening this morning France Culture which invited the philosopher André Comte-Sponville. At time 8:13 of the video below starts a sequence about transhumanism that the philosopher then comments. I also put it in writing below. I already had the opportunity to discuss the topic thanks to another edition of the same excellent program, on May 9, 2014: Ray Kurzweil has mostly wrong predictions.
To the question “André Comte-Sponville, will you take the bus to immortality”, he answers:
“No thanks! This is obviously excluded. Well more seriously some people predict, I think of Laurent Alexandre, that we will soon live 1’000 years. And his book is called The Death of Death. This is obviously a nonsense. Because, whether you die in 90 years or a thousand years, you would still die. We would live more but we would still die. As for the crazy idea, I would say, of suppressing death, again, it is an impossibility. No body, no living body can resist combustion, can resist drowning. If you spend 15 days under water, I swear that transhumanism or not, you’re dead. No human being survives a bullet in the forehead. In other words, even it happened, and God knows tomorrow is not the day, it is science fiction, but even if it happened that we win over every disease and aging, in other words we would only die by accident, well, sooner or later, because with infinite time, everything possible necessarily happens, we would have an accident and we would end up dying anyway. Simply, what would happen, as we would only die by accident, we would indeed perpetually be scared to death. What allows me to take my car today is that I know anyway that I will die and therefore dying of cancer or of a car accident, basically the difference is not essential. If I can die only by accident or murder, I’ll be perpetually scared to death. In short it will make a society of old human beings who will not have children as it would be terrible overcrowding, a society of old and coward human beings. Well that is not my ideal of a civilization or of humanity.
– So, does transhumanism scare you?
– No, again this is science fiction. That science and technology are becoming more and more present in our lives, that they may one day change human nature, that’s true. It is not there yet, but it can come and so it is legitimate to think about it. I want to say that urgent problems are elsewhere. We will be nine billion and a half, maybe ten billion in 2050, nobody knows how we will feed ten billion people. The issue of freshwater and arable land, the issue of global warming are far more pressing issues that the issue of transhumanism.
I change (slightly) the topic again. Here are books of another French philosopher whose clarity of thought and vision are exceptional. A must read. The world of start-up also needs courage, ethics and moral philosophy. Cynthia Fleury explains beautifully why any individual and any aociety also needs them… The lies of transhumanism and of societies and of individuals too must be fought!
Time to finish my account of In the Plex after already four posts. Chapter 5 is about Google in the mobile and in the video. Chapter 6 is about China, a very interesting chapter about Google’s moral dilemmas. Chapter 7 is about the relationships with government.
These chapters show Google is now a mature and serious company, with exceptions:
The keynote did end on a high note. Page had insisted that there be a question period, almost as if he were running a Google TGIF. This was almost unheard of in CES keynotes. The people at Google in charge of the speech came up with an inspired idea: they spent a bundle to book the comedian Robin Williams (a huge Google fan) as Page’s sidekick for the Q and A. The conceit was that Williams would be a human Google. The comic’s manic improvisations made people instantly forget the awkwardness of Page’s presentation. The funniest moment came when a French reporter began to ask a tough question of Page but could not finish due to Williams’s relentless, politically indefensible, and utterly hilarious mocking of the man’s accent and nationality. The unfortunate Frenchman sputtered with rage. The moment fit Google perfectly: corporate presentation turned as anarchic as a Marx Brothers skit. [pages 246-247]
“Sergey and Larry are not kids anymore,” Eric Schmidt noted in early 2010. “They are in their mid-thirties, accomplished senior executives in our industry. When I showed up, they were founder kids— very, very smart, but without the operating experience they have now. It’s very important to understand that they are learning machines and that ten years after founding the company, they’re much more experienced than you’ll ever imagine.” From Schmidt’s comments, it was reasonable to wonder when the inevitable would occur—when Larry Page, now middle-aged and officially seasoned, might once again become Google’s CEO, a job he had been reluctant to cede and gave up only at the VC’s insistence. When asked directly if he was eager to reassume the role, Page refused to engage. “That’s all speculation,” he said. [Page 254]
And the inevitable brain drain would follow
Google didn’t stop recruiting the best people it could find, especially engineers. In fact, the effort became more urgent because there were vacancies at Google created by valued employees who either joined tech firms that were newer and more nimble than Google or started their own companies. And every so often, an early Googler would simply retire on his or her stock-option fortune. The defections included high-ranking executives and—perhaps scarier to the company—some of its smartest young engineers. The press labeled the phenomenon Google’s “brain drain.” Sheryl Sandberg, who had built up the AdWords organization, left to become the chief operating officer at Facebook. Tim Armstrong left his post as head of national sales to become CEO of AOL. (“We spent all of Monday convincing him to stay,” said the grim Sergey Brin at that next week’s TGIF, expressing well wishes toward its valuable sales manager.) Gmail inventor Paul Buchheit joined with Bret Taylor (who had been product manager for Google Maps) to start a company called FriendFeed. Of the eighteen APMs—Google’s designated future leaders—who had circled the globe with Marissa Mayer in the summer of 2007, fewer than half were still with the company two years later. All of them left with nothing but respect and gratitude for Google—but felt that more exciting opportunities lay elsewhere. Bret Taylor, while specifying that he cherished his time at Google, later explained why he’d left. “When I started at the company, I knew everyone there,” he said. “There’s less of an entrepreneurial feel now. You have less input on the organization as a whole.” When he announced his departure, a procession of executives came to his desk asking him to reconsider. “I didn’t know Google had so many VPs,” he said. But he’d made his mind up. [Page 259]
Really reaching maturity?
Eric turned to him and said, “Okay, Larry, what do you want to do? How fast do you want to grow?” “How many engineers does Microsoft have?” asked Page. About 25,000, Page was told. “We should have a million,” said Page. Eric, accustomed to Page’s hyperbolic responses by then, said, “Come on, Larry, let’s be real.” But Page had a real vision: just as Google’s hardware would be spread around the world in hundreds of thousands of server racks, Google’s brainpower would be similarly dispersed, revolutionizing the spread of information while speaking the local language. [Page 271]
Failure in China
China has been Google deepest failure. Despite efforts and (too much?) compromise, Google has never really succeeded in China. Chapter 6 is another must read. Brin who has always been the most sensitive to human rights “went as far” as abstaining at a shareholder meeting.
During the Google annual shareholders meeting on May 8, 2008, Brin took the rare step of separating himself from Page and Schmidt on the issue. Shareholders unhappy with Google censorship in China had forwarded two proposals to mitigate the misdeed. The first, organized by Amnesty International and submitted by the New York state pension fund, which owned 2 million shares of Google, demanded a number of steps before the company engaged in activities that suppressed freedom. The second would force the board of directors to set up a committee focusing on human rights. Google officially opposed the proposals, and with a voting structure that weighted insider shares ten times as heavily as those owned by outside investors, the proposals were easily defeated. But Brin abstained, sending a signal—though maybe only to himself—that his conscience would no longer permit him to endorse the company’s actions in China unreservedly. When shareholders had a chance to question Google’s leaders, Brin explained himself: “I agree with the spirit of both of these, particularly in human rights, freedom of expression, and freedom to receive information.” He added that he was “pretty proud of what we’ve been able to achieve in China” and that Google’s activities there “honored many of our principles.” But not all.
It was a clear sign that Brin no longer believed in Google’s China strategy. Another signal was the fact that after Google China was established, and despite Kai-Fu Lee’s urging, neither Brin nor Page ever crossed the threshold of their most important engineering center abroad. Even in mid-2009, when the pair decided to fly their private Boeing 767-200 to the remote Eniwetok Atoll in the Pacific Ocean to view a solar eclipse and Brin used the occasion to drop in on Google Tokyo, they skipped China. Still, Google was reluctant to defy the government of China. There was still hope that things would turn around. In addition, its business operations in China were doing well. Though it had far to go to unseat Baidu, Google was clearly in second place and more than holding its own. In maps and mobile Google was a leader. In the world’s biggest Internet market, Google was in a better position than any other American company. [Page 305]
Finally…
“The security incident, because of its political nature, just caused us to say ‘Enough’s enough,’” says Drummond. The next day Drummond wrote a blog item explaining Google’s decision. It was called “A New Approach to China.” He outlined the nature of the attack on Google and explained that it had implications far beyond a security breach; it hit the heart of a global debate about free speech. Then he dropped Google’s bombshell: These attacks and the surveillance they have uncovered— combined with the attempts over the past year to further limit free speech on the web—have led us to conclude that we should review the feasibility of our business operations in China. We have decided we are no longer willing to continue censoring our results on Google.cn, and so over the next few weeks we will be discussing with the Chinese government the basis on which we could operate an unfiltered search engine within the law, if at all. We recognize that this may well mean having to shut down Google.cn, and potentially our offices in China.
On January 12, Google published the Drummond essay on its blog. The news spread through Mountain View like an earthquake. Meetings all over the campus came to a dead stop as people looked at their laptops and read how Google was no longer doing the dirty work of the Chinese dictatorship. “I think a whole generation of Googlers will remember exactly where they were when that blog item appeared,” says one product manager, Rick Klau. [Page 311]
And according to Wikipedia, https://en.wikipedia.org/wiki/Google_China “As of November 2013, its search share has declined to 1.7% from its August 2009 level of 36.2%”.
Google and Politics
By late 2007, Barack Obama already had an impressive Google following. Andrew McLaughlin, Google’s policy chief, was advising the senator on tech issues. The product manager for Blogger, Rick Klau, had lived in Illinois and had operated Obama’s blog when the politician ran for the Senate (he’d even let Obama use his house for a fundraiser). Eric Schmidt was the candidate’s official host. [Page 316]
In an ideal world: “I think of them as Internet values. They’re values of openness, they’re values of participation, they’re values of speed and efficiency. Bringing those tools and techniques into government is vital.” [Page 322]
But the reality is tougher: “The job was frustrating. Google hadn’t been perfect, but people got things done—because they were engineers. One of the big ideas of Google was that if you gave engineers the freedom to dream big and the power to do it—if you built the whole operation around their mindset and made it clear that they were in charge—the impossible could be accomplished. But in the government, even though Stanton’s job was to build new technologies and programs, “I didn’t meet one engineer,” she says. “Not one software engineer who works for the United States government. I’m sure they exist, but I haven’t met any. At Google I worked with people far smarter and creative than me, and they were engineers, and they always made everyone else look good. They’re doers. We get stuck in the government because we really don’t have a lot of those people.” [Page 323]
Final thought: Is Google evil?
This is a debate I often have with friends and colleagues. You’ve seen my fascination and I love the way Google tries, explores and changes our world. Still, one may see things differently. As an example, here are some quotes about Google Print.
Maybe the care that Google took to hide its activity was an early indicator of trouble to come. If the world would so eagerly welcome the fruits of Ocean [Google Print code name], what was the need for such stealth? The secrecy was yet another expression of the paradox of a company that sometimes embraced transparency and other times seemed to model itself on the NSA. In other areas, Google had put its investments into the public domain, like the open-source Android and Chrome operating systems. And as far as user information was concerned, Google made it easy for people not to become locked into using its products. […] It would seem that book scanning was a good candidate for similar transparency. If Google had a more efficient way to scan books, sharing the improved techniques could benefit the company in the long run—inevitably, much of the output would find its way onto the web, bolstering Google’s indexes. But in this case, paranoia and a focus on short-term gain kept the machines under wraps. “We’ve done a ton of work to try to make those machines an order of magnitude better,” AMac said. “That does give us an advantage in terms of scanning rate and cost, and we actually want to have that advantage for a while.” Page himself dismissed the argument that sharing Google’s scanner technology would help the business in the long run, as well as benefit society. “If you don’t have a reason to talk about it, why talk about it?” he responded. “You’re running a business, and you have to weigh [exposure] against the downside, which can be significant.” [Page 354-55]
But not all of the publishers found Google charming. Jack Romanos, then CEO of Simon & Schuster, later complained to New York’s John Heilemann about Google’s “innocent arrogance” and “holier-than-thou” attitude. “One minute they’re pretending to be all idealistic, talking about how they’re only in this to expand the world’s knowledge, and the next they’re telling you that you’re going to have to do it their way or no way at all.” [Page 357]
[There] was the conviction that in a multimillion-dollar enterprise such as Book Search it was unconscionable for authors and publishers not to be paid. After the debate, Aiken laid out the essence of his group’s rationale to an Authors Guild member who told him that he’d like his books discoverable by Google. “Don’t you understand?” Aiken said. “These people in Silicon Valley are billionaires, and they’re making money off you!” [Page 360]
Google has missed opportunities such as in social networking. Orkut, then Wave, Dodgeball, Buzz replaced by Google + were more beta tests and then a reaction to Facebook. Google often tries things without much effort and checks if traction comes or not. But its ambition has not really slowed down: “Michigan had already begun digitizing some of its work. “It was a project that our librarians predicted would take one thousand years,” Coleman later said in a speech. “Larry said that Google would do it in six.” [Page 352]
Indeed Page had dreamed about digitizing books already at Stanford and in the early days of Google, he began playing with scanners, helped by Marissa Meyer: “The first few times around were kind of sloppy, because Marissa’s thumb kept getting in the way. Larry would say, “Don’t go too fast … don’t go too slow.” It had to be a rate that someone could maintain for a long time—this was going to scale, remember, to every book ever written. They finally used a metronome to synchronize their actions. After some practice, they found that they could capture a 300- page book such as Startup in about forty-two minutes, faster than they expected. Then they ran optical character recognition (OCR) software on the images and began searching inside the book. Page would open the book to a random page and say, “This word—can you find it?” Mayer would do a search to see if she could. It worked. Presumably, a dedicated machine could work faster, and that would make it possible to capture millions of books. How many books were ever printed? Around 30 million? Even if the cost was $10 a book, the price tag would only be $300 million. That didn’t sound like too much money for the world’s most valuable font of knowledge.” [Page 360] (Google Print is now Google Books – https://en.wikipedia.org/wiki/Google_Books)
In 2011, Page ambition is still there. He is now the CEO. In late 2010, “Sergey Brin had repeated the sentiment: ‘We want Google to be the third half of your brain’ “. [Page 386]
“I just feel like people aren’t working enough on impactful things,” Page said. “People are really afraid of failure on things, and so it’s hard for them to do ambitious stuff. And also, they don’t realize the power of technological solutions to things, especially computers.” He went on to rhapsodize about big goals like driving down the price of electricity to three cents a watt—it really wouldn’t take all that much in resources to launch a project to do that, he opined. In general, society wasn’t taking on enough big projects, according to Page. At Google, he said, when his engineers undertook a daunting, cutting-edge project, there were huge benefits, even if the stated goal of the project wasn’t accomplished. He implied that even at Google there wasn’t enough of that ambition. “We’re in the really early stages of all of this,” he said. “And we’re not yet doing a good job getting the kinds of things we’re trying to do to happen quickly and at scale.”[Page 387]
I just finished In the Plex and I kind of feel sad. It is a book I wish I would never have finished reading. I have now read four books about Google. In fact, we are far from the end. It may even be just the beginning as Page and Brin seem to believe and I will probably read other books abotu Google in the future. As good as this one? Only the future will tell… but i will finish here with a 2007 post.
I recognized some of my concerns in the foreword of the author, in his frustrations and his hopes. “Our start-ups do not grow in Switzerland. No trace of a Swiss Google. The last major Swiss success was Logitech, thirty years ago. Our start-ups are certainly good. But when it comes to grow rapidly and on a large scale, they leave Switzerland”[Page 9]. And his answer? “[…] If Switzerland wants to remain prosperous, if it wants to be able to anticipate and invent the world of tomorrow, we need two basic ingredients: memory and craziness” [Page 11].
Switzerland is not world champion of innovation
Derder is concerned about the lack of interest of the media and politicians because everything would be fine in the best of Swiss worlds…but: “The rankings are misleading and based on an abuse of language: we are certainly world champions in education, research, science and patents (from the multinational corporattions). But not in innovation. These are two different things. But in terms [of innovation] (the transformation of ideas into products and services that create value), there is much room for improvement” [Page 18-19].
To have the next Google in Switzerland, you need to have to the three “C”, Capital, Cerveaux (brains) and a Culture of failure and risk [page 35].
This certainly reminds me the “How to be Silicon Valley” by Paul Graham: “Within the US, towns have become startup hubs if and only if they have both rich people and nerds. Few startups happen in Miami, for example, because although it’s full of rich people, it has few nerds. It’s not the kind of place nerds like. Whereas Pittsburgh has the opposite problem: plenty of nerds, but no rich people.”
In this book of almost 180 pages are listed the ten conditions:
• Attracting the best talents
• Boosting venture capital (and encourage investment in SMEs)
• Simplifying the lives of entrepreneurs (and of investors)
• Providing resources for basic research
• Bringing universities and businesses together
• Developing thematic centers of excellence
• Establishing a national digital strategy
• Committing the state (and the army) to the ecosystem
• Enhancing data protection (and encouraging citizens to protect them anonymously)
• Valuing the Swiss success stories (and make them popular)
Derder is a super supporter of start-ups and his book is a great addition to understanding why start-ups are unique and essential. I believe however that the challenges are mostly cultural as I wrote recently in Why doesn’t Europe create any Google or Apple? You will not be surprised therefore if I prefer to stop with his 3 “C”s. In a presentation I recently prepared, I gave my ten conditions for innovation, all linked to a culture of innovation:
• Collaborate, even with Competitors
• Be Trustful
• Have a healthy disrespect for authority
• Do not lie (to yourself)
• Believe in your Instinct …
• … and have Courage
• In Innovation, the example comes from above
• Bet on Talent (and Youth)
• Do not fear Failure
• Be passionate
If I consider the first 3 chapters of in the Plex as an amazingly great description of Google’s technology (chapter 1), business (chapter 2) and culture (chapter 3), the remaining chapters are also very good but I will not describe them in as much detail. Chapter 4 is about Google products that should be considered as based on two main features: they are fast and they are cloud-based (Gmail, Googledocs, Youtube, Chrome).
Sergey Brin even put a label on his cofounder’s frustration at the tendency of developers to load more and more features into programs, making them run way too slowly. Page’s Law, according to Brin, was the observation that every eighteen months, software becomes twice as slow. Google was determined to avoid this problem. “We want to actually break Page’s law and make our software increasingly fast over time,” says Brin. [Page 185]
And of course: Google often kept its products in beta much longer than other companies, signaling that users should be tolerant of faults and that an update was probably around the corner. In the case of Gmail, which became the public name for the project, the beta label was not removed until five years after Google released it, when it had tens of millions of users. [Page 171]
What’s also interesting is they’ve not always been built internally but also through acquisitions (JotSpot, Upstartle, Zenter, Android and many others – check the list of Google acquisitions – https://en.wikipedia.org/wiki/List_of_mergers_and_acquisitions_by_Google – with my short analysis below)
This reminds me a quote of Richard Newton: “Silicon Valley and the Bay Area are cradles of innovation.” And he further added, stating a colleague of his: “The Bay Area is the Corporation. […When people change jobs here in the Bay Area], they’re actually just moving among the various divisions of the Bay Area Corporation.”
I will let you discover the long analysis around concerns for privacy (Pages 179-78) but cannot avoid a final quote: It wasn’t Google’s job—nor should it be—to filter […] personal information. Griffin understood how [Eric Schmidt] felt, because she came across upset people all the time. You could explain forever how making obscure but damaging information available in milliseconds was at the core of Google’s lofty mission. “Principles always make sense until it’s personal,” she says. […] “My personal view is that private information that is really private, you should be able to delete from history,” Schmidt once said. But that wasn’t Google’s policy. If Google’s own CEO had trouble dealing with privacy, how could ordinary people cope? [Page 175]
Google acquistions
As of August 2015, Google had acquired 182 companies (136 from the US, 26 from Europe, and 20 in the rest of the world) for more than $26B. here is a visual description of the fields and years.
An amazing article I had totally missed and read yesterday thank to a colleague from IFJ/venturelab, thanks! Arnaud Bertrand does not give the usual lessons about money, product, market, blablabla. It is much more profound and painful…:
1- Succeeding at building a good business is first and foremost succeeding in the art of hiring and managing people
2- Having a differentiated product or service is far from being enough to capture your market
3- Founding a company and seeing it to success is winning a whole lot of fights against yourself
“You can’t understand Google,” Marissa Mayer said, “unless you know that both Larry and Sergey were Montessori kids.” [Page 121]
“It’s really ingrained in their personalities,” she said. “To ask their own questions, do their own things. To disrespect authority. Do something because it makes sense, not because some authority figure told you. In Montessori school you go paint because you have something to express or you just want to do it that afternoon, not because the teacher said so. This is really baked into how Larry and Sergey approach problems. They’re always asking ‘Why should it be like that?’ It’s the way their brains were programmed early on.” [Page 122]
Nerdy jokes
As a corporation, Google was determined to maintain its sense of play, even if it had to work to do it. The high holy day of Google culture is April 1, when imaginations already encouraged to run wild are channeled into elaborate pranks requiring months of work. The effort involves considerable organization, as ideas go through an elaborate approval process to find a place in the company’s ever-increasing roster of seasonal spoofs. The need for some oversight became clear as early as 2000, when Brin sent employees an email announcing that Google had a new valuation (meaning the estimate of its market price had gone up) and would soon reprice its employee stock options— from 25 cents to $4.01. Some people didn’t realize that $4.01 was a reference to the calendar and frantically tried to buy up all the shares that they were entitled to before the price went up. They dug into savings and borrowed from their families. Google eventually had to make people whole. [Page 123]
As the years went on, more Google divisions felt compelled to devise their own jokes, and by 2010 Wikipedia listed seventeen major April Fool’s initiatives for that year alone. [Page 123] What follows is just one example, among the most famous ones.
************ GOOGLE MENTALPLEX – APRIL FOOL 2000 ************
New! Search smarter and faster with Google’s MentalPlexTM
Instructions:
Remove hat and glasses.
Peer into MentalPlex circle. DO NOT MOVE YOUR HEAD.
Project mental image of what you want to find.
Click or visualize clicking within the MentalPlex circle.
The Bayshore Googleplex, also known as Building Zero, or the Nullplex, was the staging ground for Google to build out its culture into a sustainable corporate structure. No matter what happened, engineers would have the run of the place: their Montessori-inspired freedom would be Google’s distinguishing trait. [Page 129]
“Google is not a conventional company,” began Page’s letter, released on April 29, 2004. “We do not intend to become one.” It was an explicit warning to potential shareholders: fasten your seat belts!
In his “Owner’s Manual to Google,” Page put front and center the unofficial motto of Google, “Don’t be evil.” “We aspire to make Google an institution that makes the world a better place,” he wrote. “We believe strongly that in the long term we will be better served—as shareholders and in all other ways—by a company that does good things for the world even if we forgo some short-term gains. This is an important aspect of our culture and broadly shared within the company.” [Pages 149-50]
The impact of money making…
Even the Google masseuse noticed the impact of money, especially when it came to the divide between early employees holding valuable options and those who came later. “While one was looking at local movie times on his monitor, the other was booking a flight to Belize for the weekend,” she said in a book she wrote. “Don’t think everyone wasn’t aware of the rift.” [Pages 149-50] She became a millionaire herself.
Engineers can self-organize
Both Page and Brin believed that the company should run like the Internet itself: fast-moving, bottom up, going to work every day to make yesterday obsolete. “We were born in the Internet time,” says Megan Smith, “so our company’s like our products in some weird way.”
Google, however, had been through an early ordeal that showed that this flat-org ideal was unattainable. In 2001, Google had more than four hundred employees, reaching the point where it was impossible to pretend that it was an intimate company where everyone knew everyone else. Worse for Page and Brin, despite their best efforts, a layer of middle management was creeping in. Worse still, some of the newcomers were experienced product managers from companies such as Microsoft, whose training made them un-Googley—and those newcomers had difficulty adopting the often heretical approaches of the founders.
Brin and Page came up with a solution: Google would no longer have managers. At least not in engineering. Instead, they figured, the engineers could self-organize. That approach worked well in the nascent days of Google. If something needed fixing, people would figure out on their own what was wrong, and what was broken would be fixed. Other people would identify interesting problems in computing, and from those insights new products would arise. At the time Google had just hired Wayne Rosing to head engineering. Brin and Page figured that everyone could just report to him. The engineers would arrange themselves in pods of three, work on projects, and check in with Wayne.
That struck some of Google’s executives as madness. Stacy Sullivan, the head of HR, begged Page and Brin not to go through with it. “You can’t just self-organize!” she told them. “People need someone to go to when they have problems!”
The newly arrived Schmidt and the company’s unofficial executive coach, Bill Campbell, weren’t happy with the idea, either. Campbell would go back and forth with Page on the issue. “People don’t want to be managed,” Page would insist, and Campbell would say, “Yes, they do want to be managed.” One night Campbell stopped the verbal Ping-Pong and said, “Okay, let’s start calling people in and ask them.” It was about 8 P.M., and there were still plenty of engineers in the offices, pecking away at God knows what. One by one, Campbell and Page summoned them in, and one by one Page asked them, “Do you want to be managed?”
As Campbell would later recall, “Everyone said yeah.” Page wanted to know why. They told him they wanted somebody to learn from. When they disagreed with colleagues and discussions reached an impasse, they needed someone who could break the ties.
Nonetheless, Page and Brin were determined to go through with the plan. They called an all-hands meeting and announced it to a baffled workforce. For a few people it meant leaving the company. Others scrambled to find new roles. On the other hand, the move was welcomed by the engineers, who had been chafing at the creeping management restraints. For example, Eric Veach, who at the time was trying to invent the auction-based AdWords, later said that losing a manager had liberated him to make his breakthrough.
Ultimately, however, the plan petered out. After the initial turmoil, there was a quiet backslide where Google’s managerial class reassembled and regained a place in the structure. You just couldn’t have more than a hundred engineers reporting to Wayne Rosing. Google was taking on new engineers at a furious rate, and, brilliant as they were, the new people needed some guidance to figure out what to do. “I don’t remember Larry and Sergey saying that they were wrong and that we were right, but they agreed we could start to hire managers again, as long as the managers were good culture fits and technical enough and could be highly respected by the engineers,” says Sullivan. [Pages 158-59]
It was Marissa Mayer who told him the obvious—Page wasn’t looking for project managers who were smart enough to understand engineers—he wanted them to be engineers. Mayer suggested that Google look for computer science majors who saw themselves not just as engineers but as future CEOs. Her idea was to assemble a legion of “associate product managers.” Google would get them straight out of school, young people with no preconceptions derived from working elsewhere. Their careers would co-evolve with Google. “We value insight over experience,” says Mayer. “We take people who we think have the right raw skills and insights and put them into roles with a lot of responsibility. And while that happens with APMs, it also happens all across the company. People here might not really be accomplished or have a long career before coming to Google, but they have the right data instincts about their area.” […]That process made the managerial weakness of the APM an asset for Google, by making sure that data was at the center of decision making. [Page 161]
Ultimately, the program helped Google maintain its team approach while still focusing on engineering as opposed to the kind of more elusive un-Googley skills that an MBA brings. (One might also note that Google, in its management practices and hiring preference for freethinkers, has achieved a complete turnaround from the ethic posed in William H. Whyte’s 1956 classic The Organization Man, which describes the perfect corporate employee as “obtrusive in no particular, excessive in no zeal”—the polar opposite of a Googler.) [Page 162]
Larry’s and Sergey’s peripatetic ways could drive Googlers crazy. Even Eric Schmidt sometimes viewed them acerbically: “Larry will call and say, ‘I’m going to go visit Android,’” he says, referring to Google’s mobile phone project. “He’s not going over there to inspect—he’s going over there to have fun.” But Maria Montessori might approve. “To be … helpful,” she wrote, “it is necessary rigorously to avoid the arrest of spontaneous movements and the imposition of arbitrary tasks. [Page 166]
