Andrew Mason founded Groupon — an online platform that helps people find deals on local restaurants, goods and services — in 2008. As a CEO, he declined Google’s offer to buy his company for $6 billion in 2010.
Mason, known for drinking beer at the company’s annual meetings, has been criticised in the Silicon Valley for not being mature enough to run the company. Mason, however, is not the lone entrepreneur to face such criticism.
The stark truth behind the downfall of tech majors like Kodak, Blackberry or video rental company Blockbuster – not to forget the untimely death of scores of start-ups – is when top leadership mess things up, either owing to poor decisions or throwing arrogance in the public domain, especially on social media.
Tesla and SpaceX CEO Elon Musk and Facebook Founder-CEO Mark Zuckerberg fits the bill in the current scenario.
The blue-eyed boys of Silicon Valley, the duo – stubborn and arrogant to a large extent – has created super-cool brands that has the potential to change the world (only if they want that to happen).
The man behind several successful ventures — PayPal, Tesla Motors, SpaceX and SolarCity – Musk has rewritten the rules how innovation and hard work can transform businesses.
Amid all the good stuff he is doing, Musk’s irresponsible tweets have created a havoc, both in the lives of investors and the company insiders.
Smoking marijuana on a live show and name calling people on Twitter (calling a Thailand cave rescuer “child rapist” and “pedo”), Musk invited trouble for himself. After facing widespread backlash, Musk eventually apologised to the Thai diver.
In August 2018, the US Securities and Exchange Commission (SEC) filed a lawsuit against Musk after he tweeted that he was considering taking the company private. Musk and Tesla later settled with the SEC. Tesla agreed to pay a $20 million fine and Musk stepped down as Tesla Chairman for at least three years.
In March this year, the SEC pulled up Musk for blatantly violating the settlement pact. The SEC said Musk had regularly published substantive information about Tesla and its business in tweets even after the pact.
“Take a breath. Come back with your reasonableness pants on,” a US District Court judge told Musk during the hearing on the Tesla-SEC case earlier this month.
He was also criticised for allegedly pushing a former Tesla employee who resigned and was attempting to say goodbye to a co-workers.
Tesla, meanwhile, survived the lowest sales in nearly two years – a 31 per cent decline in deliveries in the first quarter of 2019 as compared to the final quarter of 2018.
In the words of a Twitter user who goes by the name of Drew G.: “I don’t have much, but I believe in you and your vision. Unfortunately, I invest what little I have into @Tesla and I continuously lose months worth of savings due to your tweets. Please think of us small people”.
In the case of Zuckerberg, his failure to take action to address obvious flaws in Facebook and to protect the brand is well documented in the latest book ‘Zucked’ by Roger McNamee, a famed Silicon Valley fund manager and venture capitalist.
Zuckerberg initially denied the existence – and later responsibility – for “coordinated inauthentic behaviours” on his platforms, including WhatsApp and Instagram, as data breaches kept happening.
Internally, Zukerberg’s goal to monetise all its platforms — WhatsApp, Messenger and Instagram — has forced several key people to leave the company.
One of them, Brian Acton, told Forbes that Zuckerberg was in a rush to make money from the messaging service and undermine elements of its encryption technology. “Targeted advertising is what makes me unhappy,” Acton said.
Facebook got another jolt when Instagram founders Mike Krieger and Kevin Systrom quit the company, also reportedly due to disagreements with Zuckerberg.
Before his death, Apple Co-Founder Steve Jobs said: “Innovation has nothing to do with how many R&D dollars you have. When Apple came up with the Mac, IBM was spending at least 100 times more on R&D. It’s not about money. It’s about the people you have, how you’re led, and how much you get it”.
The cost of arrogance is business and being humble in the public domain — the way Google’s Sundar Pichai, Microsoft’s Satya Nadella or Apple’s Tim Cook display — is the key to win the trust of customers and users.