HINDSIGHT - WRITE SOMETHING WORTH READING ABOUT OR DO SOMETHING WORTH WRITING ABOUT
Friday, July 30, 2021
SAD CHICAGO
The City of Anarchy: Calling Chicago “Chiraq” is now an insult to Iraq
By John Kass
Every Monday in the city of anarchy, on what Chicago Mayor Lori Lightfoot once called “Accountability Mondays” without irony, the media tallies the number of the weekend murdered dead and the wounded.
And the Democrat politicians point fingers at each other.
More than 70 people were shot this past weekend, with 12 dead. Over the July 4 weekend, more than 100 people were shot, among them more than a dozen children, and 19 were killed. And so on, weekend after weekend, weekday after weekday.
Violence, the fear of violence and its after-effects are the top issues in Chicago.
More than 2,000 people have been shot this year, more than a 60 percent increase compared to 2019. The crime website heyjackass.com, puts the number at 2,064 shot and wounded so far, reporting that 428 have been shot and killed.
“Another bloody weekend,” tweeted my friend Tom Bevan, co-founder of Real Clear Politics “Calling the city Chiraq is now an insult to Iraq.”
He did provide the headline to this column. But let’s understand why it is an insult to Iraq. Chicago’s crime statistics, as bad as they are, don’t tell the full story. There were 970 murders in 1974—a record year for homicides—but Chicago’s population then was more than 3 million and half the city was considered middle class.
In the nearly 50 years since then, Chicago has continued to shrink and decay—beset by woefully inept governance and poisonous policies that ground down all but the most connected of the politically connected.
Hundreds of thousands have left town since then. Chicago’s middle class is all but gone. The working classes of all races and ethnicities, which gave this city its defining character for toughness and endurance, have been decimated. Many make plans to leave. Many more are just stuck.
So, what we’re witnessing in Chicago is not simply a return to some abstract high-crime statistic which could be debated ad nauseum by the sophists and excuse makers.
We’re seeing something else: the symptoms of death. And of civic anarchy, a breakdown and fragmentation, and literal chaos at the most fundamental levels of a once-great city, the most American of all American cities.
The Democratic elite which has controlled this town and state for almost 100 years—with support of eager Republican handmaidens in what I’ve long called The Combine–don’t have a clue on how to fix it. And they most likely wouldn’t be able to recognize a solution if it slapped them in the face.
Instead, they keep following the same policies year after year, indulging themselves in the rhetoric of race, all the while clinging to an ideological prism that offers them comfort and plaudits from the national party but blinds them to the realities on the ground.
In this they are very much like the tinkerers and architects of American foreign policy in Afghanistan and Iraq, which for decades was sustained by fantasy. And that fantasy fed death and ruin to American soldiers and to the Afghan and Iraqi peoples.
Wedded to their ideology and their partisanship, they don’t dare to question Democratic policies that have that have led Chicago and much of urban America to decay and despair.
What Democratic Party policies do Democrats fear to question?
The rise of the welfare state for one. It bought Democratic votes, but it also did so much to break the family structure in many of the most vulnerable, and now increasingly violent
And sub-standard government (public) schools dominated by the leftist bosses of teachers’ unions that routinely betray working class, low-income and minority families. Government schools don’t serve the children, but they serve Democratic Party power interests, proving well-paying union jobs, administrative patronage to please Democratic state legislators, and enriching politically connected vendors who know what to do with campaign checks.
This in part is the root of Chicago’s political anarchy. But anarchy isn’t just confined to Chicago’s dysfunctional politics.
Consider the sons (and daughters) of anarchy, the tens of thousands—some say more than 100,000– street gang members of Chicago.
What many don’t understand are the effects of anarchy on the violent street gangs themselves. Historically, the gangs have been part of the city’s Democrat Party power structure, and for decades have provided street muscle to win local elections.
Their existence has long been rationalized by radical sociologists of the left claiming that the gangs became alternative families, since the real families were broken in good part by government.
But Chicago’s street gangs, like Chicago’s politics, have also broken down. The gangs, long accustomed to using violence to maintain control, are suffering from Chicago’s anarchy.
Gang culture, like the old Vice Lords and Gangster Disciples, once imposed strict discipline on their members. But even that culture has fractured completely.
The old gangs have been replaced by loose cliques–still vicious, still murderous–cliques as old gang affiliations and structures become meaningless.
And the old gangsters released from prison are themselves targeted and murdered. They’re cut down by the young, who see little profit or reason in taking orders and bowing to old school ways.
“You’ve got some guys that might be Vice Lords, but they don’t honor the Vice Lord Nation—they’re renegades,” Benneth Lee, who spent 15 years in prison, told WTTW’s Paul Caine. “You might see a group of guys on one block, there might be five Vice Lords, two Disciples and one Stone and they’re getting money together hustling, and that’s how they’re moving now.”
Years ago, the much-mythologized Chicago Outfit, known to outsiders as “the mob,” imposed structure on all crime, including street gangs. Chicago mayors called on the Outfit when street gang violence became politically unbearable.
But the Outfit was largely broken by federal prosecutions, most notably in Operation Family Secrets.
The feds also took down the leaders of the notorious street gangs, including Larry Hoover, the co-founder of the Gangster Disciple nation, with chapters across the Midwest. Hoover is now 70, serving a 200-year sentence. Some in media carried his water, trying to make him a sympathetic figure but a federal judge recently denied him an early release sentencing break.
The success of federal prosecutors in taking down gang kingpins of all ethnicities was hailed as a victory for law and order. But it ignored the entirely predictable chaos and violence to follow as a result of internecine power struggles among criminals.
Chicago wasn’t ready. Any not-woke historian could have told us that.
A common perception is that Chicago’s violence is largely contained to the roughest South and West Side neighborhoods. But with increasing frequency, the violence spills out, with carjackings, robbery sprees, shootings and murder on the increase in affluent downtown and Near North neighborhoods. These neighborhoods are still struggling to emerge from the destruction and looting from last year’s George Floyd riots, that were pushed by Marxist organizations seeking to make their own contributions to anarchy.
According to the crime website CWB Chicago, police believe that a 52-year-old resident of the pricey Presidential Towers high rise development was shot during a robber the other evening, when the robbers were themselves fired upon by gang rivals:
“As he gave the men his wallet, a four-door sedan pulled up to the corner of Jefferson and Madison. The gunmen emerged from the car and began shooting toward the robbers and the victim. One of the robbers returned fire. At least 20 rounds were fired during the melee, according to a CPD report. One bullet struck the victim in his lower back, leaving him in serious condition.”
According to reports, the victim, Raymond Soni, was pronounced dead at 7:25am on Wednesday.
The drama of Chicago violence is parceled out in episodes, of politicians talking and mothers weeping. It’s like those TV crime procedurals, in which haggard cops and haggard mayors compete to make the big speech at the conclusion that reaffirms the liberal point of view.
The dead aren’t listening. And those planning the next gang hit don’t much care about the big speech. Neither do the clerks in the county morgue processing the victims.
So, the weakened Lightfoot unleashes her top cop, Police Supt. David Brown, to do the talking, and blame judges and prosecutors for releasing violent arrestees back out on the streets, through low bail and a porous electronic home monitoring system.
“What we can do different is challenge the courts to render Chicago safe by holding violent offenders in jail longer, not releasing murderers back into our communities,” Brown said.
“Ask the courts: why are you releasing violent people, dangerous people that Chicago police officers arrest and charge, back into these communities to create this environment of lawlessness that we’re seeing here.”
Meanwhile, the judges and the prosecutors are blamed, they in turn blame the cops, as do the hard-left progressives in the Chicago City council. And now, journalists on what are called “social justice” beats push back too, on behalf of lenient social justice Chief Judge Tim Evans and the catch-and-release prosecutor, Cook County State’s Attorney Kim Foxx—first elected with campaign help by radical leftist billionaire George Soros.
I think it is wrong to throw non-violent arrestees in jail and bury them until trial. Bond should be available to all.
But repeat violent offenders arrested for violent acts—many of them gang members—should not be let out on electronic monitoring or let out into the streets with no or low bail.
That’s insane.
In a column in 2019, I reported that of more than 2,000 alleged criminals awaiting trial on home monitoring, many had been charged with violent crimes:
233 had been charged with aggravated battery; 198 with unlawful use of weapon by a felon; 108 with being an armed habitual criminal; 109 with sexual assault; 21 with kidnapping; and 109 with murder or attempted murder.
And that CWB website keeps reporting on dozens after dozens of violent actors who commit violent crime while out on low bond or the electronic ankle bracelet.
Since then, the George Floyd riots and accompanying calls to defund police in almost every major Democratic-controlled city have put police on the defensive.
In Chicago, the cops can’t even chase them on foot.
And anarchy grows, strangling a wonderful city like a weed.
(Copyright 2021 John Kass)
Thursday, July 29, 2021
Wednesday, July 28, 2021
Tuesday, July 27, 2021
NEW INC. MAGAZINE COLUMN BY HOWARD TULLMAN
Big
Isn't Always Bad. In Fact, It's the Whole Idea.
Yes, the FAAMG five can be belligerent and needs to be held accountable. But we also need them more than you think we do.
BY HOWARD
TULLMAN, GENERAL MANAGING PARTNER, G2T3V AND CHICAGO HIGH TECH
INVESTORS@TULLMAN
We're just weeks away from the
"formal" start of the 2022 election season -- as if the politicking
ever ends -- and it's always good to have an easy target to flog as this bunch
of do-nothings, proud obstructionists, and performative liars heads home as
Congress goes into recess.
This time around, in addition to the usual
suspects there's another major whipping boy on the agenda: Big Tech.
All of this would be nothing more than the
usual sad circus of clowns lying about the Big Lie except for the fact that the
Big Tech boogeyman provides such an irresistible and wonderfully villainous
distraction from their inaction. Virtually every politician in D.C., on both
sides of the aisle, has agreed to hate on and incessantly attack the FAAMG
five.
The Dems have their traditional grievances,
mainly concerns about monopolistic injuries to competition and small businesses,
and the sale of consumer data. The loudest Republicans are all a dither about
supposed suppression of free speech and the alleged censoring of conservative
online discussions concerning anti-vax information. Unfortunately, to make
matters worse and even more damaging to the country's competitive prospects,
President Biden just piled on the bandwagon with a 72-item bill of particulars
directing more than a dozen federal agencies to do "something" to
change the laws, increase the regulation, improve the scrutiny, and otherwise
stem the awful tide of growth, innovation and prosperity which we've seen over
the last two decades in the tech sector.
The unavoidable implication of Biden's program
is that the Federal Trade Commission and other regulators will now be free
(without clear guidelines or standards) to try to invent restrictions on the
fly. They want to abruptly rescind and interfere with existing and
long-established understandings regarding anti-competitive market behaviors,
mainly because Congress itself hasn't done a thing to address any of these
growing and legitimate concerns for years.
As a serial tech entrepreneur, and even
believing that much of this latest drama and BS will come to nothing, it still
concerns me to repeatedly hear the entire discussion reduced to the same old
tired and simplistic argument that "big is bad." All the major tech
giants began as tiny and insignificant startups and fought for years to
overcome existing competitors, antiquated and anti-competitive laws, and other
impediments, including skeptical and actively hostile regulators and all manner
of local politicians firmly in the pockets of the industry incumbents.
No one thinks that it's likely to be any
easier today to achieve the levels of success of Apple (b.1976), Amazon
(b.1994), Google (b.1998), and Facebook (b.2004), but most of these giants
initially emerged in the massive and imposing shadow of Microsoft (b.1975), the
Evil Empire of Redmond. Somehow, they survived and thrived. Microsoft is now
inexplicably regarded by the media and millions of others as some kind of
harmless and benign force for good, unless you happen to be an anti-vaxxer
concerned about the little chips being inserted into your bloodstream.
This is especially amazing as we watch
Microsoft Teams slowly but inevitably drain the life out of Slack -- even with
Salesforce's ownership-- as a result of the utter entrenchment of Office 365 in
the Fortune 500. Teams' user counts grew from two million in 2017 to 150
million today and its growth and penetration continues to accelerate.
The bottom line has been, and will always be,
the same: building new businesses is risky and tough, change is always
difficult and consistently resisted, and creating new, disruptive and
innovative solutions is challenging, expensive, and not for the faint of heart.
The playing field has never been level and never will be. The guys at the top
of the hill aren't going anywhere voluntarily. They'll invoke every excuse and
impose every possible obstacle - legal and regulatory for sure - with the
cooperation, connivance and unspoken support of every politician they can
enlist.
Size always matters, especially for our major
tech firms today because - and make no mistake - they are fighting off and
defending our country from massive, continual and increasingly effective
attacks from China and Russian in particular. They are using their own
resources and funds to do so because our own government is too hidebound,
ill-equipped, and politically paralyzed to do much of anything other than make
vague and unenforceable threats. If these very same companies don't continue
the battles, or are hobbled and weakened by idiots in D.C., we won't have to
worry much longer about preserving a competitive environment for the little
guys. Instead, we'll be looking at ways to save our entire country from being
overrun.
In addition to the external threats, size is
also absolutely critical to true and substantial innovation that moves the
needle at scale. You can start small and smart, but if you're going to lead the
return of competitive manufacturing capabilities to the U.S. mainland in both
the automotive and space industries, you're going to have to have enormous
resources behind you to effectively and quickly scale. It takes big bucks to
make the big bets that make a difference ultimately in our lives. Putting aside
the phallic implications, there's no doubt that SpaceX (Tesla), Amazon and
Virgin have done more for the expansion and innovative enhancement of the U.S.
space program in the last decade than the government itself, notwithstanding
the annual expenditures of billions of bureaucratic dollars.
There are undoubtedly anti-competitive
practices in the tech universe - it's a winner-take-all world by its very
nature. And being the new little guys on the block in any business is rowing
against the tide. The power of platforms and their dominance
continues to grow, but they are absolutely the most cost-effective tools to
offer, warehouse, and rapidly deliver millions of products created by small
local merchants to a global market.
More importantly, is it really fair or even
effective to abruptly move the goal posts, change the rules, and enlarge the
penalty boxes? Especially when you are looking through a new lens,
restating the long-standing theories regarding benefit to the consumer as the
regulatory bottom line objective and grandly assuming that somehow, at some
future time, for reasons that are unclear and specifically contrary to the
expressed objectives of the biggest players, that consumers will cease to
benefit from the massive choices, immediate access and delivery, and remarkably
lower prices that Amazon in particular has brought to every marketplace it has
entered?
JUL 27, 2021
Monday, July 26, 2021
Sunday, July 25, 2021
Saturday, July 24, 2021
Introduction from "I Alone Can Fix It"
The characteristics of Trump’s leadership, blazingly evident through the first three years of his presidency, had deadly ramifications in his final year. He displayed his ignorance, his rash temper, his pettiness and pique, his malice and cruelty, his utter absence of empathy, his narcissism, his transgressive personality, his disloyalty, his sense of victimhood, his addiction to television, his suspicion and silencing of experts, and his deception and lies. Every trait thwarted the response of the world’s most powerful nation to a lethal threat.
Thursday, July 22, 2021
Nancy Pelosi Calls BS
Nancy Pelosi Calls BS
The pundit class clutches its pearls
|
|
Washington is shocked
because Nancy Pelosi decided yesterday that making a farce of an attempted
insurrection was not normal.
Like much of the
numbed political establishment, Kevin McCarthy had assumed that Pelosi would
simply go along with his decision to try to beclown the January 6 committee.
Three of his five appointees had voted to overturn electoral votes from states
won by Joe Biden.
That, in itself ought to
have been disqualifying, but the appointment of Jim Jordan and Jim Banks was
starkly unsubtle. Jordan is a one-man clown car, whose only role on the
committee would have been to throw merde into the gears and
provide Fox News with soundbites.
But it was actually
worse than that.
Back in December,
Jordan had fully embraced Trump’s Big Lie, saying that Trump should refuse to
concede the election. There was, he told CNN, “No way, no way, no way” that Trump should concede. “We should
still try to figure out exactly what took place here. And as I said, that
includes, I think, debates on the House floor — potentially on Jan. 6.”
As the New York Times reports: “Later that month, he participated in a meeting at the White House, where Republican lawmakers discussed plans
with Mr. Trump’s team to use the joint session of Congress on Jan. 6 to
challenge the election outcome.”
In other words,
McCarthy — who is himself a potential material witness — named another material
witness (and potential co-conspirator) to the panel investigating the attack on
the Capitol.
As for Banks, our
colleague Tim Miller wrote:
He is an election
truther who polled his constituents on whether or not he
should cancel the votes of citizens from other states. . . . Banks’s communications director
is Buckley Carlson, son of Tucker, ensuring that the White Power Hour will have a
direct line to leaks from the committee.
From the beginning,
Banks made it clear that he intended to derail the committee’s work. He accused
Democrats of creating it to “malign conservatives.”
“I will not allow this
committee to be turned into a forum for condemning millions of Americans
because of their political beliefs,” he declared.
Banks also pledged an
aggressive campaign of distraction and whataboutism. “If Democrats were serious
about investigating political violence,” Banks declared, “this committee would
be studying not only the January 6 riot at the Capitol but also the hundreds of
violent political riots last summer when many more innocent Americans and
law-enforcement officers were attacked.”
Under the Old Rules,
Pelosi was expected to go along with all of this.
Conventional wisdom
assumed Pelosi would accept the New Normal in which the minority party was
openly declaring its intention to memory-hole and retcon an attack on Congress
itself. The smart set figured she would go along with the GOP’s decision to
turn the probe into a clickbaity shitshow.
On Wednesday, Pelosi
decided to hell with that.
“With respect for the
integrity of the investigation, with an insistence on the truth and with
concern about statements made and actions taken by these Members, I must reject
the recommendations of Representatives Banks and Jordan to the Select
Committee,” Pelosi said in her statement.
“The unprecedented
nature of January 6th,” she said, “demands this unprecedented decision.”
In other words:
She drew a red line
because an act of sedition requires the drawing of red lines.
The result was a
cascade of faux outrage.
McCarthy sulked and
DC’s pundit class collectively clutched its pearls. “Nancy Pelosi just doomed the
already tiny chances of the 1/6 committee actually mattering,” opined Chris Cillizza. “Should have left well enough alone,”
former Ohio Governor John Kasich insisted on CNN. Others insisted that it was a
gift to McCarthy,
But this requires us
to accept the idea that it is perfectly normal to name members who, as Tim
Miller puts it, “literally supported a MAGA coup” as a precondition of
“bipartisanship.”
Of course, the
committee is already bipartisan, both literally and seriously. (Reminder: the
GOP killed an actual independent, non-partisan commission.)
Not at all
surprisingly, it was left to Liz Cheney to provide the reality check about
Pelosi’s decision. “This investigation must go forward,” she said. “The idea
that anybody would be playing politics with an attack on the United States
Capitol is despicable and is disgraceful.”
The
Republican Accountability Project @AccountableGOP
Cheney noted that
Pelosi had rejected two appointees.
One who may be a
material witness to events that led to that day . . . the other who disqualified
himself by his comments over the last 24 hours demonstrating he's not taking
this seriously
And then she trained
her fire on McCarthy:
The rhetoric we have heard from the minority leader is
disingenuous . . . at every opportunity, the minority leader has attempted to
prevent the American people from understanding what happened.
I think that any
person who would be third in line to the presidency must demonstrate a
commitment to the Constitution and a commitment to the rule of law and Minority
Leader McCarthy has not done that.
Exit take: Pelosi and
Cheney reminded us yesterday that we don’t have to eat the shit sandwiches — or
pretend that there is anything normal about any of this.
Wednesday, July 21, 2021
BRET STEPHENS COLUMN
BRET STEPHENS
Eric Adams Is Going to Save New York
July 20, 2021
Opinion Columnist
Eric Adams arrives for lunch alone, no
entourage or media handler. He shows me his new earring — “the first thing,” he
says, that Joe Biden “asked to see” when the two met recently to discuss gun
violence. He orders a tomato salad with oil on the side, the abstemious diet of
the all-but-crowned king of New York.
For some progressives, the prospect of
Adams as mayor (he still has to defeat Republican opponent Curtis Sliwa in
November) is a nightmare. He’s been a thorn in the side of every institution
he’s ever been part of.
He’s a former cop who crusaded against
police brutality, a leading Democrat who was once a registered Republican, a
machine politician who casts himself as a foe of city bureaucracy, a
self-described progressive who’s friendly to charter schools and real estate
developers and, most recently, a champion of law-and-order who refutes the idea
that a Black leader must also be on the left.
For the rest of
big-city America, not to mention the Democratic Party that usually runs it,
he’s a godsend.
That’s because Democrats are
again becoming the party of urban misrule, just as they were in the 1970s. In
Portland and Seattle, progressive mayors have ceded the public square to
anarchists and rioters. In San Francisco and Los Angeles, to homeless encampments
and addicts. In Chicago and Baltimore, to street gangs and gun violence.
And, in New York, the city that in the
1990s and 2000s led the way in the historic and nationwide reductions in
crime, 981 people were shot this year as
of Sunday. That includes two women and a 4-year-old girl hit by stray bullets
in May in Times Square, in broad daylight.
“This stuff can unravel so quickly,”
Adams says, referring to social order. His mission is not to let New York go
the way of Portland or San Francisco.
The key is the police. In
2019, multiple videos went viral of police officers
offering no response after being doused by hecklers with buckets of water.
“When I saw that I said we’re going to lose the city,” he recalls. “When you
attack that officer, you didn’t attack that individual. You attacked the symbol
of safety.”
Adams
graduated from the police academy in 1984, another era of diminished faith in
law enforcement, not least among cops themselves. The prevailing attitude, he
says, was, “You hold on for 20 years, you get promoted, get your pension,
nothing you’re going to do about crime.” He rejected that attitude and made his
name in the 1990s as a dissident officer fighting police brutality and racial
profiling.
But he also believes that
effective policing is the basis for justice, not an enemy of it.
Well-intentioned liberals, he says, “have piggybacked off of the appealing,
attractive conversation. You know, ‘Black Lives Matter.’ Well, if they matter,
damn it, then we should be talking about a 13-year-old kid being assassinated
in the Bronx.”
He argues for reversing the
state bail reforms that treated some robberies as nonviolent offenses,
for bringing back the plainclothes police squad disbanded last year by Bill de
Blasio and for using stop-and-frisk (or, as he reminds me,
“stop-QUESTION-frisk”) as an essential policing tool, so long as it isn’t being
unconstitutionally abused to fill a weekly police quota or harass civilians.
As for abolishing the police:
“When I get out of that subway station, I want to see that cop at the top of
the stairs.”
After rebuking certain progressives for
their views on New York’s finest, he turns to their views on New York’s
richest. “Sixty-five thousand families pay 51 percent of our income taxes,” he
says. “Those income taxes are going to the police, the teachers, Department of
Sanitation. We have people who say, ‘Who cares whether the rich leave?’ You’d
better connect the dots. I care!”
Adams doesn’t fear the rich leaving
town because of sky-high taxes (though he should). But he knows that they’ll
flee to safety if they have to fear that their children “can’t walk the
streets.”
He also recognizes the harm the city
does itself with its results-unfriendly bureaucracy.
“How do you have a Small Business
Services that’s trying to get restaurants open, but you have the Department of
Buildings that takes a year and half to give someone their C-of-O to get
inside?” he asks, referring to a certificate of occupancy. “Try opening a
hotel: If you can get their sprinkler system inspected in two years, you’re a
miracle maker.”
He plans to do for
city agencies what the CompStat program did in the 1990s when it took police
units out of their respective silos to make them see the larger picture. It helped
bring crime down from historic highs to historic lows, until liberal guilt got
the better of pragmatic good sense. At one point he quotes the Chinese aphorism
that it doesn’t matter if the cat is black or white, “you still have to catch
the mouse.” It happened to have been a favorite of Deng Xiaoping.
Listening to Adams
hold forth like this for an hour is an enjoyable, even delightful experience,
because it’s so refreshingly free of ideological cant. If Adams can govern as
he campaigned, he’ll be remembered as the mayor who saved New York from walking
itself off a ledge. It probably won’t be the last, much less the highest,
office he’ll hold.
Monday, July 19, 2021
New INC. Magazine blog post by Howard Tullman
Don't Sell Until You Clean Up the Code
A lot of software-dependent startups, having survived the pandemic intact, are now at the "move up or out" crossroads. But there's a hidden risk buried deep in their digital architecture.
BY HOWARD TULLMAN, GENERAL MANAGING PARTNER, G2T3V AND CHICAGO HIGH TECH INVESTORS@TULLMAN
A regular topic of
conversation in every post-pandemic board meeting these days has to do with
buying or selling something. Often, the company itself is potentially on the
block, but at other times the discussion is about acquiring a competitor ripe
for a timely takeover, or an outfit in an adjacent line of business to add
revenues and help cover fixed costs. No one wants to sit still right now even
though it's not clear whether the better, smarter, and safer path for the
business is up or out. Everyone's got their
own advice and suggestions on the subject.
This present angst may
be the product of an emotional and physical hangover from the pandemic, where
everyone's just really tired of fighting fires and struggling to stay alive. Or
perhaps it's due to an unsettling sense that the big guys in tech have grown so
immensely bigger in the last two or three years (most of them at least doubling
their market caps in that time) and that they're even more dominant in
practically every space that matters. Either way, there's just a ton of
talk about trying to get bigger fast or cashing out entirely. Needless to say,
discussing these two rather starkly opposed alternatives makes management,
investors and board members more than a little nervous.
All of these tense
discussions revolve around a similar checklist, including accomplishments,
valuations, risk factors, and market conditions. But the issue that has the
most critical relevance for semi-mature startups (2-to-5 years in the fight)
isn't these considerations or the other obvious choices such as sales, traction
and profitability. I'm referring to the much more difficult determination of
"tech debt," which is an unavoidable part of the early stages of
building any code-based business. I call this problem "the pig in the
python" which - in its simplest terms - means that there's often a pile of
undocumented and sometimes entirely abandoned spaghetti code right smack in the
middle of the business's core operating systems. This code helped to get you
there, but now it's a cause of unnecessary friction in the system, it's
creating serious documentation issues and raising personnel concerns - in
short, excess baggage that still needs to be maintained or eventually removed.
The prospect of having
to clean up this very expensive code, which any young company has likely spent
millions developing over the last several years, is one of the major deal
killers that I've seen even though it's an ordinary, expected, and completely
typical part of the iterative process that every business undertakes. Buyers
and somewhat naïve board members all want to know how you could possibly have
spent so much on developing code that no longer plays a part in the current programs.
Especially since someone new (on their dime) is now going to have to make it
all go away and is likely to be unhappy or unwilling to bear both the costs of
the remediation process and the competitive risks associated with it -- which
may even be greater.
Hence, the classic
wisdom around acquisitions: it's not how much you pay for the deal; it's how
much the deal ultimately costs you. Tech debt is the embedded and
hard-to-calculate expense of fixing and eliminating all the crappy code, false
starts, ugly overhead, and other vagaries that still live in a business's code
base many years after any of it ceased to have any value or effectiveness. Yet
the business wouldn't exist without the trials and errors, unproductive
directions, new product initiatives, and overall answers and ultimate
improvements that the code represents.
Every software
delivery system starts out big and bulky and ideally, over time, is
streamlined, simplified and sped up. The process is as unavoidable and
inevitable as gravity. And anyone who thinks that it's an easy task to make a
consumer-facing system look simple and be user-friendly has never built
anything. As Richard Branson always says: "Any fool can make something
complicated. It's hard to keep things simple."
And, even more importantly,
businesses need years to determine the best inputs and outputs to these
systems, whether those are queries, searches, forms, reports, or responses. For
startups, this simple reality presents a very serious risk. In tech businesses,
you learn that anything really great seems obvious and inevitable in
retrospect, but that's only to people on the outside -- never
to the ones who had to suffer through the birthing process and make the
millions of changes required to get to the end result. But being
underappreciated for pulling off this trick and building this thing of beauty
isn't the worst pain by a long shot.
Sadly, once you solve
the riddle and create the ideal solution, everyone and their brother can jump
right in and copy the front and back ends of your business and do it faster,
cheaper, and even more efficiently because they aren't dragging three years of
old code along with them. They haven't had to spend years and millions of
dollars getting to the solution. They don't have a pig stuck in the middle of
their process because they went to school on your solution, ran right up your
back, and, most likely, even built their competitive offerings on better,
faster and more efficient third-party systems, clouds and networks. This is not
a happy story, but it is a familiar one. Not one startup in a million has
invested in patents or other legal protection sufficient to help in this
situation or nor they can afford the legal battles it would entail.
So, all of the
remediation costs aside, in those buy- or sell- discussions, there's always the
competitive risk element as well. How quickly will the competition be able to
duplicate all the business's offerings for a far smaller investment and, even
worse yet, should the prospective buyer just take a step back and look into
building their own version of the solution rather than buying yesterday's code
and a bunch of other baggage? All because startups across the board are always
in too much of a hurry moving forward to clean up after themselves and take out
the trash. Documentation is also a pain and a burden, but it's another essential
building block startups consistently neglect until it's too late.
A word to the wise:
Invest the time now, before you think about trying to sell your business, to
audit and purge your code base, confirm that your documentation is in order,
and make sure that the loss of one or two critical employees at any point
wouldn't put the entire operation at risk because of their unique knowledge and
history. Take your own careful and detailed look at whether you should be
cannibalizing your own code, moving some operations to someone else's cloud,
and otherwise reducing your exposure and improving your own system's
efficiencies by taking advantage of tomorrow's code rather than yesterday's.
JUL 20, 2021
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