Book Summary — The New New Thing
A Silicon Valley Story
1 paragraph summary:
Jim Clark’s Life Story — founder of Silicon Graphics, Netscape and Healtheon. 3 billion dollar companies. The book covers the beginnings of Silicon Valley and many VC firms.
The book is a mix of a history lesson about Silicon Valley and an adventure story of Jim Clark’s Hyperion, a computerised sailboat, which sailed across the Atlantic.
Before any of Jim’s success he was in very dark place:
I was thirty-eight years old. I’d just been fired. My second wife had just left me. I had somehow fucked up. I developed this maniacal passion for want to achieve something.
Jim’s journey describes the beginnings of Silicon Valley and how he rewrote the rules of startups:
(1) VCs were giving Jim money on his terms
Clark liked to say that human beings, when they took risks, fell into one of two types, pigs or chickens. “The difference between these two kinds of people”, he’d say, “is the difference between the pig and the chicken in the ham-and-eggs breakfast. The chicken is interested, the pig is committed. If you are going to do anything worth doing, you need a lot of pigs.”
The VCs could tolerate companies’ going bust — they had so many of them — but they could not tolerate missing out on the new new thing. And so they poured their money in. They threw good money after bad into an enterprise they suspected would fail. They had wanted to be chickens; Clark forced them to be pigs.
(2) Jim gave engineers a large chunk of the company
(3) Companies didn’t have to have profit to IPO
The internet formula of success turned traditional capitalism on its head. Traditionally a company persuaded people to invest in it by making profits. Now it persuaded people to invest in it first, and hoped the profits would follow.
All three things were unheard of before Jim Clark. The founded three billion dollar companies and after his first one Silicon Graphics all engineers and VCs wanted to follow him at any terms as they believed he will make them rich.
Jim was driven by revenge and impatience.
Impatience might be social vice but, to Clark, it was a commercial virtue. “If everyone was patient”, he’d say, “there’d be no new companies.”
Success to him became a form of revenge. He needed people or places to doubt him so that he could prove them wrong.
The author depicts Jim Clark as someone far removed from society, which Jim attributes his success to:
His talent for groping the future was generally viewed as a supernatural gift, but it was a matter as much of his limitations as of his strengths. He could see human society in ways that most businessmen could not, because he was not very much a part of it. And consciously or not, by retiring to his floating island, he preserved this precious limitation.
