The Mirror Effect

Yesterday I was watching a show about the human brain and some of its odd behaviors. One such behavior was The Mirror Effect. They showed a couple having an argument while the husband was making a salad. All of a sudden, the husband cuts himself with a really long, sharp knife and blood comes gushing out. I felt the pain through my body just by watching it. Weird right?

It’s the same mechanism that causes you to smile when someone else does. They called it Mirror Neurons on the show. It doesn’t look like scientists have much insight into how this works but it’s clear it does.

Then, today, I read Lew Cirne’s Q&A on the New York Times. He’s the CEO and Founder of a very successful startup called New Relic (an anagram on his name). One of the things he said there is the impact of a CEO on the psyche of his employees. Just one sentence can make or break their week.

I first experienced this a decade ago, when I was a young team leader at the Israeli Defense Force’s 8200 unit. I was managing 12 people at the age of 22 without a real clue what I was doing. One morning I came in very aggravated about something that happened earlier. My team members immediately noticed and it was clear it wrecked their day without me even saying a word. That’s when I learned my lesson. The impact of a manager is clearly profound.

With startup CEOs though it goes to the extreme. You have a daily impact on an entire company. Even if people don’t see you that day, they watch your actions as well as the actions of their managers, who in turn take their cues from you. I’m told this effect gets reduced once you cross 150 people (incidentally, that’s the number also mentioned in the Sapiens book as the limit to the size of a group of people where everyone knows each other).

So when Lew said that there are days he doesn’t come into the office if he feels he’ll have a negative impact, it resonated with me. It’s an interesting idea that I may find myself needing to implement one morning. Luckily, my optimistic way of seeing life has so far ensured I start my days positively energized.

Happy Hump Day to you all.

Is Silicon Valley Successful Despite Its Public Infrastructure?

Stefan Dyckerhoff, a partner I respect at SHV, recently said “Silicon Valley is successful despite its public infrastructure.”. (he’s also an immigrant, by the way)  One has to wonder though, how much of a positive impact the public infrastructure can really have on a hi-tech company?

Yesterday I was riding the Caltrain home from the office, when all of a sudden the train stopped. Apparently, a vehicle got hit in Menlo Park and all trains have stopped for a couple of hours as a result (naturally, I jumped on a surge-priced Uber as a result at 2.1x).

I’m originally from Israel. A few years ago, after a series of similar incidents, the department of transportation decided that all risky rail crossings must be separated (so the road must go below or above, and not cross, the tracks). That is clearly a public infrastructure investment decision geared at saving lives. Some, though, argued it also helped the economy.

But, has it really helped the economy? How do we know?

There is generally a wide agreement that investment in public infrastructure improves the economy.  Examples include research conducted on the Mexican and Chilean economies and generally correlation is found. Causation though, is debatable.

The debate gets even more heated when one looks at the hi-tech industry. Is that industry affected at all by the investment in public infrastructure? If you look at California’s five-year public infrastructure investment plan for 2014-2019, you’ll see the main focus is around:

  • Judicial Branch – except for the odd lawsuit, I’m not sure this has a positive impact on the hi-tech industry.
  • Transportation – I spend quite a bit of time and money on the road/tracks. Better public and private transportation would result in less money wasted. I don’t see this necessarily impacting time, though, as usually I’m not driving and am doing something else on the way (phone calls, emails, etc.) anyway.
  • Natural Resources – I love parks, I take my kids to them often, I respond very positively to the color green and the smell of freshly cut grass. However, I don’t see this helping the hi-tech industry much.
  • Education – well, this definitely has a long-term impact on the success of the hi-tech industry. There are some really good K-12 schools here and of course some top colleges and universities. These are fueling the growth and success of startups and we don’t need to collect a lot of data to prove this has a positive impact on Silicon Valley’s hi-tech industry.
  • General Government – frankly, non of the sub-items there I could say has a positive impact on my ability to work or build a company.

When one measures the impact of investment on the economy, the decreases in production costs and increase in productivity are the metrics tracked. If we look at a recent analysis by Tomasz Tunguz on the “production costs” of a startup, we see the increase is dramatic and is fueled primarily by wages. Are wages increasing due to the high costs of living in CA, or due to high demand for talent and the positive impact of such talent?

One can also look at this as a whole – hi-tech relies on talent, and if talent can’t move here (due to high costs, lack of real estate, etc.) then startups will experience talent starvation, will pay more for the same talent and will be less successful. There clearly is a talent shortage in Silicon Valley right now, but I’m thinking it’s caused by an explosion in startups rather than an inability to get people to live here. So investment in public infrastructure would do little to reduce the wages.

To summarize, is it possible that other than education, an improved public infrastructure really wouldn’t do much to help Silicon Valley grow? And if so, what do we even care about the public infrastructure except for the mild frustration of being stuck on a train?

Sapiens and the Brief History of Startups

Sapeins: A Brief History of Humankind (by Yuval Noah Harari) is a book reviewing the history of humans, with specific focus on Homo sapiens and our future as a species. This book has just recently been made available in English and I highly recommend reading it (I read the English version).

While I read it over this past weekend, I found myself thinking a lot about the micro-cosmos I live in: the startup world. As the book points out, the idea of limited liability companies and corporations is a very new one and even compared to that, startups are an extremely new idea. So imagine how insignificant is the concept of startups on the progression of humanity over the course of the million years we’ve been walking the planet. As the author of Sapiens calls it, companies are just a fiction we’ve created to achieve certain goals, there’s no physical value to their existence.

However, startups are the entire life of of nearly two million people, some living in Silicon Valley and others not. Compass have just released a report on the evolution of startups over the past few decades with an intense focus on Silicon Valley. They take us through what they call “the tipping point between the Industrial and Information Eras”. This is interesting as it ties into what Harari discusses regarding the Industrial Revolution and attempts to forecasts where humanity is going.

So, in a thousand years, will someone write an updated version of Sapiens and discuss how the Information Revolution has impacted humanity? Specifically, will they go into great lengths to describe a place called Silicon Valley, where “startups” were created at a previously unheard-of pace, that changed the day-to-day of humans across the entire Earth?

I believe so. Not just because I am the founder of a startup that has set its eyes on changing the world. But because I look around me and see that others are doing the same, and many of us are succeeding. Humans now consume information differently, interact differently, make our livelihood differently and enjoy life differently. Radically different in most cases. It’s akin to the Agricultural Revolution which turned humans from wandering bands to the creators of permanent residences.

Funny to think that startups, which are just a figment of our imagination per Harari’s book, are changing the lives of not just the billions that live today, but the hundreds of billions that will live just a few years from now. Goes to show how powerful imagination can be.

 

Why Optimist? Why Entrepreneur?

My name is Yonadav Norman Leitersdorf. You can call me Yoni for short.

Years ago I decided to leave a comfy job and start my own business – indeni. Since then, I was fully focused on getting a product out the door, finding the first customers and hiring our first employees. I have recently lifted my head up from the day-to-day operations and realized there was something missing.

I no longer had a separate existence. My being merged with that of my company and was indistinguishable. My company is my baby (one of three – the other two are Gili and Michael). On a daily basis, I put everything I have into it and have given no regard to my own, independent brand. My independent brand is important – just as people like Aaron Levie, Mark Zuckerberg, Bill Gates and Larry Ellison have made it clear to us all.

The straw that broke the camel’s back was Mark Suster’s post on personal brands. After thinking about creating my own brand for a while, this post helped me crystallize what I wanted to achieve. So thank you Mark.

I find myself thinking a lot about my life, my work and my family. Most of my thoughts come up in the shower, which is why I take 20-30 minute long showers (although considered by many to be a bad idea – hopefully I won’t be all wrinkly in a few years). Showers are the most productive time of the day for me because they happen in the morning (my brain gets into gear very quickly) and there are no interruptions.

I digress.

My goal with this blog is to be open, sharing, brutally honest, with what goes on in my mind. Since 99% of what goes on in my mind is about work, so will these blog posts be.

Lastly – the name of the blog came from the two characteristics that define me the most: I’m an eternal optimist, knowing that the future is bright, and I’m addicted to building things, hence the entrepreneur.

Looking forward to sharing, listening and discussing with you all.