For a place reputed to be the epicenter of the greatest creation of wealth in the history of the planet, have you ever noticed how uncomfortable Silicon Valley seems to be with its money? Compared to Hollywood where conspicuous consumption has no limits, or Wall Street whose sole measurement is money, the Valley seems almost embarrassed by its riches.
I’m not the first to notice this. Last year, Nick Bilton wrote about the tech industry’s penchant for downplaying its wealth and gave several reasons for why he thought the Valley behaved this way, but I think Bilton only got it half right. It isn’t just money that makes Silicon Valley uneasy. It’s power.
In order to understand Silicon Valley’s uncomfortable relationship with money and power, we must first understand our collective self perception. The Valley, especially entrepreneurs, views itself as a collection of pirates and revolutionaries. We believe we’re the crazy ones fighting against “The Man” and attempting to change the world.
But there’s a problem with revolutions. When they succeed, and the Silicon Valley revolution has clearly succeeded, the leaders of the revolution become the new status quo.
Power is an anathema to Silicon Valley, because accepting it would be a de facto admission that we are no longer the revolutionaries. Along with its close relative money, power is the domain of the establishment. Embracing this role would destroy our sacred self perception, a perception we believe is the secret sauce of Valley entrepreneurship.
The only way to deal with this cognitive dissonance is to downplay wealth and reject power. In this worldview, if power must be accepted, then it should be done so grudgingly and only as a last resort. The only acceptable use of money is to fund new revolutionaries, i.e. become an angel investor or venture capitalist. By investing their money in new entrepreneurs, Silicon Valley power players get to tell themselves that they are still part of the revolution and not part of the establishment. As part of the same positioning, ostentatious displays of wealth are frowned upon as wasteful since those resources should be going to help fight the good fight.
Another byproduct of Silicon Valley’s outdated self image as the scrappy outsider is our naive expectation that even our biggest companies should be open and benevolent. We howl in protest when they lobby for legislation that favors their interests, or when they close their ecosystems to curb competition. Apple, Google, Amazon, Facebook, and Microsoft didn’t become some of the wealthiest and most powerful companies in the world by playing nice. I can assure you, even the services and offerings that appear to be in the best interests of the users have been created to benefit the bottom line of the firms in question, not as part of some altruistic revolution.
I’m not anti-Apple, -Google, or any of these companies. This post is being typed on a Macbook Pro using Google Docs and will be emailed to PandoDaily using Gmail. But I fully recognize that they are very much part of the power establishment and not some kind revolutionary movement.
Which brings me to my final point. It isn’t just Apple, Google, Amazon, Facebook, and Microsoft that have become part of the establishment. It’s all of Silicon Valley. The revolution is over. We’ve won. And in winning, we’ve become “The Man.” Sure, there are still entrepreneurs out there as there always will be, but the overarching belief that the Valley is a counterculture collection of pirates and revolutionaries simply isn’t true anymore.
We’ve created more concentrated wealth than any place in history and with that wealth comes power. These are the hallmarks of the establishment and no amount of financial modesty or “change the world” manifestos can change that. Downplaying wealth and railing against the establishment have become a charade. As much as it flies against our self perception, it’s time to admit that we are not the revolutionaries anymore.