Being Nice vs. Being Good
The social capital trap we are in as an industry
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In startups, social capital is king. I’ve been seeing more and more people increasing their social capital by being nice, but not necessarily by being good. I agree that anyone in business should be nice, but I don’t see that as the factor that moves someone up. I think that is the factor that qualifies someone to play the game in the first place.
For example, let’s look at venture capital. VC is an industry that is hard to enter, and once someone does break in, no one knows if they are actually good until a decade later. This is the perfect storm for someone who is nice, but not skilled, to enter.
In an industry that is predicated on network, being nice makes people feel good. When you make someone feel good, you leave a good impression. You leave a good impression to enough people, people talk highly about you. Eventually, this leads to people trusting you. Once they trust you, then you’re in the club. Once you’re in the club, they give you money to manage. Now you’re a VC. So what if we took the opposite example? We have a very skilled investor, but one who isn’t networked in with the inner circle? Unfortunately, if you’re in tech, you know how this story ends.
Outside of venture capital, I see the social capital trap as well. For example, it benefits no one to be truly honest with a founder about their startup that may really not be ready for capital. Telling them you like their startup increases your social capital to that founder, makes the founder feel good, and the objective truth never needs to come out. If you told a founder directly how you felt about it, the founder would dislike you, may spread rumors, and your social capital goes down. This is why so many in tech don’t share the truth. It goes against their professional goals. They’d rather be nice to the founder, not good to the founder.
If this is where we are at as an industry, where does this leave people who are good, yet not as networked? People who lean on their skills versus leaning on their charm? You want the honest answer? I have no idea. And that’s a problem.
The problem that I have been interested in is the time factor. Skill will usually win out over time. But in that time, how many of those skilled give up due to lack of network?
This is one of the main reasons I have been following what you are building. I think you are very much on the right page. For example, I have been a corporate software engineer for a decade. I know where my skills lie. But when I left my last company to start my own, I have to prove myself to the world. It has been tough. I don't have much of a professional network in the startup ecosystem because I had focused all my energy on corporate life. So I have to slowly build up a network in the startup community while also trying to build out a product that generates enough revenue to live off of until I can secure funding to grow.
Keep up the good work. I think you are building something the world needs. Excited to see how you grow.