This Valley Is Small

You will hear everyone out on this coast say it – the Valley is small. I couldn’t agree more. While I believe there are still some actual geographic constraints on what is and isn’t the Valley, blogs have actually broadened the scope of the Valley to include folks outside of the Bay Area who are still deeply integrated in the tech scene, though not physically present. For me, the Valley sometimes just feels like an ethereal collective of people who are building and dealing in technology more than any one physical place.

Whatever the case, in the last four weeks, I have seen a few entrepreneurs underestimate how small this Valley really is.

It started a month ago with an email from a VC friend of mine. He forwarded me a message from an entrepreneur who noted, in no uncertain terms, that Google was a big fan of his WiFi access node technology. This VC was, appropriately, doing a reference check before investing and wanted to know why it was we really liked this equipment.

As co-lead of the Google WiFi effort it seemed funny to me that I hadn’t heard the name of this vendor before and was pretty sure we hadn’t met with them. I asked the VC to double-check with the entrepreneur about the veracity of the statement. The entrepreneur had the audacity to write back to the VC that he had met with Google a number of times. I checked with my team. Had anyone heard of this company? Sure enough, one team member says “Yeah, I bumped into them at a trade show. They have been begging for a meeting.” “But, did we endorse their tech?” I asked. “Nah. I don’t know anything about them,” says my colleague.

That was it. That was their basis for claiming our deep and passionate support for their product in a VC pitch - bumping into a member of our team and asking for a meeting. Needless to say, the VC thanked me for the heads up and presumably walked away from the funding opportunity. At the same time, this company, whose technology may have been wonderful for all I know, assured themselves of never doing business with me.

This, unfortunately, wasn’t an isolated incident. I recently watched more than one startup submit our name as their partner for a recent RFP. When asked what they intended to achieve by this, they boldly and baselessly defended the action, and yet quickly scrambled to redact all uses of our name.

On top of this, I get executives at Google telling me that they receive calls from entrepreneurs alleging that I vouch for them and using my name to get on the exec’s radar. Yikes. (First of all, if you know me, you know I think phones are wasteful and would never recommend a call.) One colleague at Google told me a company founder mentioned we were having ‘very fruitful discussions.’ When I checked my Gmail, the only communication we ever had between us was my polite “no thank you” email response to his unsolicited query. Fruitful?! Happens again and again.

I am not sure I get what all these guys are thinking. Do they think that we are not going to find out? Do they assume that because Google is now 5,000 employees we all sit in offices with doors closed and don’t chat? Do they believe that VCs don’t diligence their investments anymore? Heck, many VCs are excited to have a reason to get back in touch with an old friend and will email me right away.

In any event, the minimal upside a founder will enjoy if they pull off such a fabricated endorsement without it making back to us can’t possibly be worth the very real downside of being discovered as untruthful.

To be fair, I have been on the entrepreneurial side of the coin many times. I know the temptation, and sometimes, the benefit of being aggressive. I once asked a mentor of mine at Fenwick how you go about raising a $100 million venture fund (it was a long time ago) and he told me that his mentor said “by selling the last $5 million spot twenty times.”

I am all for posturing. You want to use the royal ‘we’? Go ahead. You want to try to convince me that you have another offer on the table or a partner who is moving faster? I am ready to play cards and sniff out a bluff.  However, one currency that should always be handled with kid gloves is the endorsement of another resident of the Valley. 

Comments

[sue reiten]

Chris, I am taking your advice, and making the assumption that google has NOT thought about my product involving search. Ideally, given your org structure, I would like to give this proposal to Marissa Mayer. I need either your contact information, or hers in order to do this. With your strong suggestion to email, as opposed to phone or otherwise, I am willing to accomodate, but need a contact address. Please advise. I live in Seattle, but the office there wasn't helpful with my request. Thank you for your consideration.
Sue

[Ben Atkin]

I agree with you about phone conversations being wasteful. The company I work for has outsourced their call center in India, and even now there's a huge effort to cut the calls in half and start doing things over the Internet. If having indians with low wages answering phones is bad for business, I can only imagine how bad it is for a Google exec to be bothered by one-sided phone calls from strangers.

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