With over two decades wrapped up in the startup world, I've seen my fair share of eccentric geniuses, shady dealings, questionable ethics, and icky bosses. Come with me on a journey through space and time to visit the lesser-known side of tech, where the hustle is real and the ethics are optional.
Welcome to my series, "Flashes & Failures" where I, Seth, your guide through the ups and downs of startup life, share personal red flags, cautionary tales, and outright failures I've had and encountered along the way. We'll explore both the successes (flashes) and the painful failures (...& failures), all while shedding light on the less glamorous aspects of the tech industry. My goal? To educate, to entertain, and hopefully inspire hope for those trapped in the purgatory of Silicon Valley.
The Adult Entertainment "Surprise"
I landed my first job at a web hosting startup in the '90s and knew I had struck gold. Who doesn't want to work for a pick-and-shovel maker during a gold rush!? The CEO was impressed by my personal projects I was hosting on their servers - a little odd that he was creeping my website, ironically the first version of sethserver! - but the offer came with a solid paycheck, a job at a tech startup, and room for growth. Little did I know, I was in for a surprise.
I had an interesting first-day interaction with the company's CEO - my boss. Instead of the expected welcome aboard, company-is-family anecdote, and pep talk, he leaned in and said, "Let me give you a piece of advice. Always hire a secretary with big boobs." I laughed nervously, unsure how to respond. He chuckled and waved me off, leaving me to rethink my life choices.
A few weeks later, I was deep in server maintenance, patching Java software on WindowsNT boxes with RAID5 arrays of SCSI drives. When I was finished patching this particularly busy server I popped open the DNS zone file to confirm the sites were still responding from the outside world. As I scrolled through the names, a pattern quickly emerged: lots of .net domains, lots of the letters "xxx", the word "nude" - it seemed our servers were hosting a lot more than just standard websites. I realized that adult entertainment was a significant part of our business.
A few days later, the CEO called me into his office again. "I imagine by now you've stumbled across some of our larger client's sites," he said, sheepishly slumping into his chair. "Adult entertainment is a big part of what we do. It pays the bills and is honestly the only market that makes us any money." He went on to explain that his wife knew about the business and was fine with it. I nodded, processing this new information, and appreciated the transparency - the core tenet of basically every startup ever.
The startup didn't last too much longer as the first dot-com bubble burst, leaving a lot of us out of work.
Seth's Startup Survival Tip: Before accepting a job, do your due diligence on the company's culture and clientele. Make sure they align with your values.
The Sports Betting Bamboozle
Years after my stint at the adult entertainment web hosting company, I found myself working for a sports betting startup. We had a sleek website that was gaining popularity among sports fans. I was thrilled to be part of a growing company in an exciting industry.
Things were running smoothly until the day the founder and his "advisor" friend pulled me into a meeting. While bouncing around different ways to increase engagement, the advisor casually suggests that we "optimize" the algorithm, making vague references to "enhancing the user experience".
It only took a moment for me to realize what they were proposing: rigging the system in favor of the house. I pushed back, questioning not only the ethics of such a move but also the potential of blowback from our most active users. My concerns were dismissed with the founder insisting that it was standard practice in the industry and the updates would make the system more competitive.
I begrudgingly tweaked the algorithm and watched in horror as our users started to notice. Complaints came in, with many accusing us of cheating. The once-positive reviews turned scathing, and our user base rapidly began to dwindle.
I've never really wanted to work at a company that blatantly deceives its customers. Eventually, usage got so low that the company was no longer viable, and we all moved on to greater things.
Seth's Startup Survival Tip: Trust your gut. If something feels unethical or illegal, it probably is. Don't be afraid to speak up and walk away from a compromised situation.
The Tale of the Sneaky Sales Rep
At another point in my career in a different universe, I found myself at a SaaS company providing marketing automation tools for SMBs. A few months into my tenure, I heard rumblings that our support team was struggling. Being naturally curious and always the hero of my own story, I took it upon myself to investigate. On the surface, customers were frustrated, complaining about unfulfilled promises and missing features, and were churning hard. The obvious problem was with support.
As I dug into the data, I uncovered a compelling pattern: one sales rep had a disproportionately high number of clients who churned. Interestingly, they churned within a month or two of signing up, always right after sales had already collected their commissions.
As I snooped more I learned that this rep was known for making grandiose promises to potential clients, assuring them of features and results that our product, services, and support teams could not deliver. The rep was selling vaporware, knowing full well that the clients would be furious and were highly likely to churn and trash the reputation of our company. But by the time the clients did churn, the rep had already moved on to their next unsuspecting victim.
I was flabbergasted. They were burning through clients, eroding trust in our brand, and putting undue pressure on our support team.
I passed my findings on to senior leadership, presenting undeniable evidence of misconduct. Arrogantly, I expected swift and furious action after a quick investigation. However, to my surprise, the leadership team seemed indifferent to the whole situation. It appeared that hitting sales KPIs and keeping investors happy was more important than ethics! What!? Really?
Despite my demands for accountability, the sales rep remained gainfully employed and continued their questionable practices. Finally, in a predictably ironic twist of fate, the head of support and I were laid off, with the company citing "financial reasons."
It was a bitter lesson, but it - for better or worse - reinforced my strong desire to speak truth to power and stand up for what I believe is right, even in the face of resistance. It also highlighted the need for a genuine culture of transparency and accountability, where, regardless of an individual's performance or position unethical behavior is never tolerated.
Seth's Startup Survival Tip: Don't be afraid to speak up when you witness unethical behavior, even if it means challenging those in positions of power. Really, titles mean nothing when they're not used to effectively protect people and everyone should be held to high ethical standards.
Conclusion: Navigating the Startup Wild West
Looking back I'm in awe of the sheer variety of ethical dilemmas I've encountered. From the subtle pressure to compromise my values to the overt demands to engage in unethical behavior.
Through all the grift and the sleaze, I've learned some invaluable lessons. I've learned to trust my nose, to ask the tough questions, and to stand my ground. I've learned to do my due diligence, to monitor key metrics closely, and to investigate anomalies thoroughly. Most importantly, I've learned that no job, no matter how lucrative or exciting, is worth sacrificing integrity.
To all the entrepreneurs, developers, and startup enthusiasts out there, I offer this advice: Don't be dazzled by the flashy promises and the quick wins. Do your homework, ask the hard questions, and always, always use your ethical compass. It's the only way to build a startup culture that values transparency, accountability, and integrity.
Stay tuned for my next post, where I'll be sky-diving into the wild world of startup hype and the art of discerning substance from spin. Until then, keep fighting the good fight, and remember - in the startup world, if it sounds too good to be true, run fast and far!
-Sethers
