In ’s latest piece, there’s an apt observation that a 1D culture built around comp turns out to be fragile and susceptible to envy.
The same can be said about hotness/hype in the startup world.
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There’s a mainstream VC narrative that goes “take VC money because having a brand name VC as a backer makes it easier for you to hire!”
There’s a few ideas smushed together here:
- VC-backed comp is higher
- Brand name credibility
- Hype as hiring hook
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But any savvy operator should be suspicious of these ideas.
- Competing on comp is an endless treadmill
- There is always going to be a startup with more brand name backers
- There is always a startup with more hype.
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It’s easy to point to a positive factor and go “oh, this makes the flywheel (hiring, revenue, whatever) go whrrr.”
But then the next question you should ask is “now how are you going to beat someone with the exact same flywheel?”
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The answer is obvious: you do things that are hard to copy, or you go fishing in underfished ponds.
It strikes me that taking capital to win at hiring (for brand/comp/whatever) is like buying expensive bait at one of the most overfished ponds in the world.
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Anyway, this is just me pushing back on a mainstream narrative that never seemed to make much sense.
Are there underfished ponds? Yes. But they keep changing.
The art of hiring above your weight class is to develop a nose for these underfished ponds, and to keep adapting.
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(Well, one aspect of the art; there are others.)
Maybe the only generalisable lesson here is “sellers of an undifferentiated commodity (e.g. capital) will seek to convince you that the solution to your problems is said undifferentiated commodity.”
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Also, in order to not steal ’s thunder, he ends his piece with this fantastic note:
I enjoyed the entire piece. neckar.substack.com/p/does-wall-st
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Related: thought this by on the In Depth podcast was great. You’ve probably seen this already, but just in case not
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