Home Radio Segments Guest Segments How Silicon Valley’s Bad Behavior Compares To 80’s Wall Street: Part II

How Silicon Valley’s Bad Behavior Compares To 80’s Wall Street: Part II

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Turney Duff, SIlicon Valley

With Turney Duff, Author of The Buy Side: A Wall Street Trader’s Tale of Spectacular Excess, Contributor to Showtime’s Billions and CNBC’s The Filthy Rich Guide

Steve returns for Part Two of his conversation with Turney Duff on Silicon Valley’s excesses and their parallels to Wall Street in the 1980s. Turney chronicled his own spectacular rise and fall on Wall Street in the book, The Buy Side.

If You Don’t Participate, Don’t Come

Steve quotes from an article in Vanity Fair, titled “OH MY GOD, THIS IS SO F—ED UP”: INSIDE SILICON VALLEY’S SECRETIVE, ORGIASTIC DARK SIDE”, on Silicon Valley’s underground party scene: “You only get invited if you can be trusted and if you’re going to play ball. You can choose not to hook up with [a specific] someone, but you can’t not hook up with anybody because that would be voyeurism. So if you don’t participate, don’t come in.”

Essentially, invitees are accomplices who buy into this culture, and it’s all about relationships, just as it is on Wall Street, says Turney, where people call their partners-in-crime to place their biggest trades.

More Influential Than Bankers, Actors, And Athletes Will Ever Be

Steve cites another quote from the Vanity Fair article:

“Furthermore, these elite founders, CEOs, and VCs see themselves as more influential than most hot-shit bankers, actors, and athletes will ever be. ‘We have more cachet than a random rich dude because we make products that touch a lot of people,’ says Founder X. ‘You make a movie, and people watch it for a weekend. You make a product, and it touches people’s lives for years.’”

Turney sees some truth in the claim but also sees the extreme arrogance and hubris.  While it’s one thing to say you’ve got millions in the bank, saying that you invented something big is definitely a bigger stick to swing.

Early Innings For Silicon Valley

Here’s another quote from the article:

“For many women who describe it, however, it’s a new immaturity—sexist behavior dressed up with a lot of highfalutin talk—that reinforces traditional power structures, demeans women, and boosts some of the biggest male egos in history: just another manifestation of Brotopia.”

Turney sees the same power dynamic playing out as Wall Street’s excesses, but only in an earlier stage.  He draws a baseball parallel and calls this the third or fourth inning for Silicon Valley, but the sixth or seventh for Wall Street.

Molly, Your Personal AI Morals Gatekeeper

In the Vanity Fair article, Silicon Valley entrepreneur Esther Crawford, who talks openly about her sexual experiments and open relationships, says she started a company with her partner, Chris Messina, a former Google and Uber employee best known for inventing the hashtag.  The company is called Molly, perhaps not uncoincidentally the same name as the drug, where they are developing a “nonjudgmental (artificially intelligent) friend who will support your path to more self-awareness.” “The future of relationships is not just with humans but A.I. characters,” says Crawford, who is acutely aware of the harsh reality that as a female entrepreneur she faces so many challenges that men don’t. What she has found is that, for a woman, pushing private sexual boundaries comes with a price.

While men get rewarded for participating in inner circle shenanigans, that same kind of behavior is a sin for women.  If you’re a woman trying to get ahead in a male-dominated world, you’re damned if you do, damned if you don’t, says Turney.

Moreover, he isn’t too bullish on AI bot Molly’s abilities to rein in human excesses because people moral righteousness stems from within and rarely works if you trust an AI bot to make a decision for you.

Implications For Silicon Valley

In closing, Steve wonders if this is the beginning of the end of Silicon Valley dominance if the tide might now start to turn against the Amazons of the world as individuals, small businesses, and government regulators fight back against big tech’s growing dominance in our day-to-day lives.  Silicon Valley’s recent revelations might just be the little catalyst that precipitates a movement to get back to what’s right.

Click here for Part I


Disclosure: The opinions expressed are those of the interviewee and not necessarily United Capital.  Interviewee is not a representative of United Capital. Investing involves risk and investors should carefully consider their own investment objectives and never rely on any single chart, graph or marketing piece to make decisions.  Content provided is intended for informational purposes only, is not a recommendation to buy or sell any securities, and should not be considered tax, legal, investment advice. Please contact your tax, legal, financial professional with questions about your specific needs and circumstances.  The information contained herein was obtained from sources believed to be reliable, however their accuracy and completeness cannot be guaranteed. All data are driven from publicly available information and has not been independently verified by United Capital.

Read The Entire Transcript Here

Steve Pomeranz: I’m back with Turney Duff, and we’re talking about what’s going on in Silicon Valley and the parallels to Wall Street. Turney Duff is an expert in that area as he chronicled his own rise and fall on Wall Street in the book The Buy Side, so welcome back to the show there.

Turney Duff: Thank you. Thank you.

Steve Pomeranz: Let me quote directly from the book and really from the article in Vanity Fair. So, quote, “You only get invited if you can be trusted, if you’re going to play ball. You can choose not to hook up with a specific someone. But you can’t not hook up with anybody because that would be voyeurism. So if you don’t participate, don’t come in.” What does that mean to you?

Turney Duff: It means, if you’re going to show up, you have to be an accomplice. And what it does is it eliminates tattle tales, right? And to go a little deeper, everything is about relationships and very similar to Wall Street. If I got in at six in the morning and I had a crazy night, when I get into the office the next morning and I have a 6 million share trade, who am I going to call? Am I going to call the guy that I broke 12 laws with last night, or am I going to call some guy who is at home in bed at 9 PM?

Steve Pomeranz: Yeah, so you’re much more likely to do business with someone you broke the law with rather than someone else, not that any of this stuff that they’re doing, by the way, is breaking laws. Maybe moral laws.

Turney Duff: Right, well, I think there’s drugs there.

Steve Pomeranz: Okay.

Turney Duff: Yeah, that counts, right?

Steve Pomeranz: All right, here’s another one, this is a quote, “Furthermore, these elite founders, CEOs and VCs which are venture capitalists, see themselves as more influential than most bankers, actors and athletes will ever be. We have more cache than the random rich dude because we make products that touch a lot of people says founder X. You make a movie and people watch it for a weekend. You make a product and it touches people’s lives for years. Do you think there’s truth here or is this just extreme arrogance and hubris?

Turney Duff: I mean, it, it’s both, right? I mean, it’s a thousand percent arrogant, but there is some truth to it. Whether you’ve got 10 or 15 million dollars in the bank, that’s cool; but if you’re at a cocktail party and you can say, “I invented that technology,” that’s definitely a bigger stick to swing.

So, there is truth to it, but hearing that makes you want to punch the guy in the face.

Steve Pomeranz: [LAUGH] Well, there was, in this article, actually, I think I’m going to read this in a minute, no, I actually took it out. But one of the founder people or successful people in Silicon Valley were notable because they invented the hashtag.

Turney Duff: [LAUGH]

Steve Pomeranz: And it just blows my mind that these seemingly innocuous kinds of inventions and uses can just create so much wealth. But, what do I know?

Turney Duff: Yeah, now its…

Steve Pomeranz: Here’s another one. “For many women who describe it, however, it’s a new immaturity. Sexist behavior dressed up with a lot of highfalutin talk that reinforces traditional power structures demeans women and boosts some of the biggest male egos in history, just another manifestation of brotopia.” Is this the same Wall Street construct just wrapped up in a new package? I know we keep asking the same question. But now we’re talking power politics. How does that relate?

Turney Duff: I mean, of course, it’s the same. I would venture to guess that maybe Silicon Valley’s, in the third or fourth inning of this and Wall Street’s probably in the sixth, seventh inning. Wall Street has had to address some of this, but there is definitely still an issue in terms of power and dynamic between men and women on Wall Street and in Silicon Valley.

Steve Pomeranz: All right, take multi-time entrepreneur Esther Crawford—I’m still quoting from the article—and husband Chris Messina who have openly discussed their lifestyles have started a company together called Molly, perhaps not un-coincidentally, the same name of the drug, where they are developing a quote, “non-judgmental artificially intelligent friend who will support your path to more self-awareness.” They go on to say, “the future of relationships is not just with humans but with AI characters,” so the author of the article was told. However, Crawford, the wife in this part of the article, “is acutely aware of the harsh reality that as a female entrepreneur, she faces so many challenges that men don’t. What she has found is that for a woman pushing private sexual boundaries comes with a price. The idea about women’s roles here are if you do participate, don’t ever think about starting a company or having someone invest in you. Those doors get shut, but if you don’t participate, you’re shut out, you can’t win.”

Take it from there.

Turney Duff: [LAUGH] Yeah, there’s a lot to process there. I mean, whatever happened to talking to your pets, right? They don’t judge you. But she makes a valid point because certain kind of behavior, in any business, is rewarded for men. And that same kind of behavior is a sin for women, and we were talking offline before about the Me, Too Movement.

And hopefully, this is the start of something, at least, a dialogue has been started, but she’s right. You’re damned if you do, damned if you don’t. And it becomes difficult for women because you can’t get ahead. But if you do what you need to do to get ahead, then that’s three strikes.

Steve Pomeranz: Yeah, you can’t get inside the club, so to speak. It just occurred to me though, so they’re talking about artificial intelligence being your new next, your best friend. So we have Alexa, we have Cortana, we have all these, we have Siri. So, I think what they’re saying is that we’re already starting to interact with the technology or with some form of artificial intelligence. Now, let’s say, they now take this step of infusing Alexa with moral fiber. So you say, Alexa, should I go to this party? Now, Alexa’s going to probably say, “well, probably a bad idea because nobody’s ever going to fund your new business if you go to that particular party.”

But yet, so maybe Alexa’s going to have moral fiber, but actually the people who are actually encoding Alexa, probably may or may not and anyway, these problems are much more complicated than probably artificial intelligence can help us with. Anyway, I just saw that as a-.

Turney Duff: Yeah, but you know what’s interesting about that is when I was in my second rehab, I was talking to the head of it and he’s like, “I got a full relapse prevention program for you and I was like, all right, give it to me.”  He’s like, “all right, if you want to use, you have to call a family member, call a sponsor, go to a meeting, knit a sweater, run five miles”, whatever the list is, right?

Steve Pomeranz: I got you. Yeah, it’s the last thing you’re going to do.

Turney Duff: I’m sorry?

Steve Pomeranz: That’s probably the last thing you’re going to do.
You’re not going to feel like doing any of it, I would think.

Turney Duff: Well actually, yes, but I said to him, I go, “But if I want to use, I’m just going to go use.” He’s like, “exactly,” and so, it made me realize that I couldn’t keep a pact with myself. And so, if you’re going to depend on AI to make a moral decision for you, guess what?  You’re not going to ask.

Steve Pomeranz: Yeah, that was kind of my point, as well. You’re not going to knit a sweater. You’re just not going to ask. You’re just going to go use. Nothing’s really going to help you, except you and knowing what’s right or wrong. And then doing the right thing, period.

All right, so I wonder if this is the beginning of the end of Silicon Valley dominance? As these large tech companies dominate their industries and ravage existing industries—I’m thinking of Amazon let’s say—I think the tide is going to turn against these companies as regulators and as the destruction of these small businesses and what’s going on in average people’s lives get to such a point that people start to fight back.

So the stories like these may be kind of the tip of the spear. The beginning of this idea, well, now we’ve got these companies that are taking over the world, that have all this power, plus to a large degree the people that work there are morally corrupt, as defined in articles and books like this.

And that happened to Wall Street, and it’s happened to any number of other industries, right?

Turney Duff: Yep, yep, 100%.

Steve Pomeranz: My guest Turney Duff, the author of The Buy Side, and also was a consultant on the show Billions. And also, I think the perfect person to talk about these kinds of issues because he’s been there, done that.

Turney, thank you so much for joining me today.

Turney Duff: Thank you for having me, Steve.

Steve Pomeranz: Hey, and don’t forget to hear this again and listen to the full show or to get a summary of the vital info we’re discussing here today, go to StevePomeranz.com. And while you’re there, sign up for our weekly update, where we’ll send you my weekly commentary and interviews from the show including a searchable archive section if you think you’ve missed something straight to your inbox.

Click here for Part I