Wednesday, July 27, 2005

What balance?

Disclaimer: All references to success in the following post refer only to professional/financial success. Obviously, there are several ways to be successful in life, many of which do not come with financial rewards.

Two of my favorite bloggers, Fred Wilson and Brad Feld, weigh in on the concept of work/life balance this week. Now, I don't know either of them, but each of them is a GP at a VC fund, which is no easy thing. They also speak about their families in their blog, especially Fred, and even through their posts, it's obvious that their families are important parts of their lives.

So, successful, with strong families - these two must have it all figured out right? Well, looking at their narratives, maybe that's not the whole story.

Brad reminisces:
I started my first company when I was 19 and in college at MIT. I was obsessive, worked incredibly hard, and - while I generally had a lot of fun - was almost always maxed out. This manifested itself in many ways, including always being overcommitted, regularly being exhausted, having a failed marriage when I was 24, and physically changing - according to one of my best friends - from "skinny Brad" to FOB ("fat older Brad").

During this time, I was very successful at the work I did. I created a company - Feld Technologies - which was acquired by a public company. I helped start and/or finance a number of other companies which went on to be acquired or go public. I helped create a venture capital firm. I was well known and respected within the entrepreneurial community - both for what I had accomplished and what I was working on.

In a similar vein, Fred says:
Although I didn't know it at the time, it was an issue that I was really struggling with, having just started Flatiron, wanting badly to prove myself to my partners and investors, and also struggling with a family - three young kids and a wife.

Both of these posts follow a pattern I've seen in every discussion of work/life balance. A successful executive talks about how they were completely driven and single-minded for a long time, had varying degrees of difficulties in their personal life, and then finally came to the realization that they needed to have more balance in their life. While this always makes for an inspiring story, the one part that is never mentioned is how much of their professional success was a direct result of their single-minded focus.

For better or worse, we are often judged professionally, not only on how much we have accomplished, but by how quickly we have accomplished it. This problem is only exacerbated by the fact that it is much harder to prove oneself at the beginning of a career, than to maintain a developed reputation. By no means am I saying that either one of them is "coasting" on their reputation, but both of these men have achieved a certain professional status. With that status comes the expectation, at least from most people, that these guys know what they are talking about. In most cases, meeting, or even exceeding these positive expectations does not require the type of all-consuming dedication that building that reputation in the first place does.

The simple fact is, some things are hard, and require a 100% commitment. To be the most successful in several fields, this kind of focus is a pre-requisite, at least early in your career. This kind of commitment is not limited to the business world - sports, acting, music - all require a single-minded focus (not to mention a little luck) to rise to the top. I say this, not to denigrate the importance of family or a personal life, but to highlight the reality of the situation - balancing a personal life with a career will inevitably lead to forgoing some advancement in the latter. Whether or not this is a worthwhile cost/benefit, is something that each person has to decide for themselves, but I think it's important to acknowledge that "Balance" is sometimes about choosing between the two, and not just a matter of juggling better to have it all.

If I could ask Brad and Fred a question it would be - do you think you would have risen to GP as quickly had you had more balance in your life early in your career? Looking back, would you have been willing to delay that accomplishment by 5 years to have more balance? How about 10 years? Would you have been willing to pursue another (presumably less interesting) career altogether, if that is what it took to achieve the balance you have now?

Tuesday, July 19, 2005

Textiles, Steel... IT?

Just got back from India yesterday, and I have a couple of observations to post about. As I find time over the next few days, I'll write about some of the things I noticed in Bangalore while visiting. All of these observations are based on anecdotal information, as I was there for a wedding, not research.

The first thing that struck me on my trip were two conversations I had within the first 48 hours. The first was with an old colleague in Singapore during my day-long layover, and the second with a relative of mine in Bangalore.

In Singapore, we were talking about how much the attitude of Singapore has changed recently. I mentioned that there seemed to be a much bigger push towards entrepreneurship and strategic management, visible even to a casual tourist, than I saw when I worked there a few years ago. The front display of every bookstore was dedicated to their bestsellers, but those best sellers were not by Crichton, Grisham, or Rowling - Instead, they were by Welch, Gladwell, Covey, etc. Tellingly, I went to 5 bookstores in the city, and EVERY ONE of them was sold out of "The World is Flat" by Thomas Friedman.

Naively, I believed this push was because Singaporeans felt they could benefit greatly from the more globalized economy. My colleague was kind enough to disabuse me of that notion quickly. It seems there's actually a sense of quiet dismay among the country's labor force. Many of the jobs that came to the country only over the past couple of decades are now being moved off shore.

Just a day later, I had arrived in Bangalore, meeting relatives I hadn't seen in 20 years, if ever. One of my distant cousins and I were chatting, and I found out that he recently started working at Siemens. He mentioned that he had been there for only 3 months, but was excited as he had moved from being a developer to more of an architect role. As we talked more, I found out that the reason he originally had to move was because the company he had previously worked for had relocated to Northern India. Apparently, competition for good developers had driven rates too high in Bangalore, and there were better opportunities elsewhere in India. What struck me most however, was what he said about the move. "We did all the hard work bringing it here. After that, moving it somewhere else was easy." The move from having an on-site, integrated development team in California, to an off-shored, spec driven development team in Bangalore is difficult. Processes have to be put in place, communications have to be improved, etc. However, once all of these have been set up, the move from having that off-shored development done in Bangalore to having it done somewhere even cheaper is much easier.

What does this mean? Well, for the foreseeable future, there will always be a oversupply of well educated people around the globe, who can do basic development work. That means even the "low cost" centers that exist now, will soon face pressures similar to what we see here now. Singapore, which was built on the back of outsourced manufacturing as it grew, is slowly seeing that pressure, as there are still high switching costs to moving a plant. Bangalore however, built on the information economy, is seeing these pressures arise only 5-8 years after really getting started!

Most industrialized nations today shared a few key development points. Textile and steel are two traditional examples of industries that most countries develop at some point. The theory is that these are industries that help a country develop the infrastructure and basic skill set to allow for the next level of advancement. However, the basic nature of these industries also means that they face competitive nature more rapidly than others, as evidenced by the state of American textile and steel today. IT development looks to be the next of these fundamental industries - a traveling aid for developing economies, not a viable final destination.

Tuesday, July 05, 2005

How flat is the world?

I'm off to India for a couple of weeks (I have a family wedding in Bangalore), so I'm looking forward to visiting. I'm a 'Bama boy born and bred, but I always enjoyed visiting the "motherland", and since this is my first time going as an adult, I'm interested to see how different the experience is.

Before I leave though, I wanted to put down some thoughts I had following a VC networking reception I went to last week. I don't want to mention the fund by name, but basically, they would like to be the VC fund of choice for American entrepreneurs of middle eastern origin - specifically for business models built on the idea of outsourcing "intellectual" work to the middle east. They want to set up the region as the destination of choice for research and engineering design outsourcing, claiming that India and China are both set up for low skill/low wage outsourcing, and so will not be competitors in the area.

Obviously, key concerns with dealing with the region are stability, infrastructure, talent pool, etc. Unfortunately, their answer to any question in this area was "Dubai". They acknowledged the problems, but seemed to think that everything could be solved by locating in Dubai. However, this seemed at odds with their value proposition - that being able to tie into the ENTIRE region was how their fund could add value.

Another related topic that I was skeptical on was their ability to brand the entire North Africa, Middle East and Pakistan region as a unified whole. In all of their comparisons, they related this region to India, Israel, or China - their models on how to break into a new area. They talked about how each of these regions had groups that came to America and grew into the first generation of entrepreneurs, which then led them to build out industrial bases in their home countries. They are counting on the same level of national affinity among MENA-Americans to locate their offshoring in the middle east. However, unlike India, or China, the multi-national nature of MENA may pose a problem. Since they want to locate everything in Dubai, but recruit entrepreneurs from the entire region, I'm not sure how big an advantage they will have when it come to an entrepreneur from, say, Tunisia.

One last note - they made it clear over and over that they don't want to compete on a cost basis with China/India, but that the middle east is still "50% as expensive as Silicon Valley". Now, I didn't see exact numbers, but if they are using the 50% discount from SV as a selling point, that would seem like a tough sell, since there are probably several cities in the US itself where engineering talent could be had for close to that level, with much less hassle.

In general, I've seen plenty of presentations, articles, and conversations talking about "XXX" will be the next India or China. Invariably, XXX is some arbitrary compilation of geographic/political entities needed to support a big enough base to make a comparable number of entrepreneurs, faculty, or engineers to India or China. However, no matter how much technology has lowered barriers between cultures, the fact is a group of nations that happen to border one another will never enjoy the same economies of scale that you can accomplish within a unified, relatively homogeneous nation, such as India or China. In both of these countries, a big push to their growth was their national government's investment in education, and later, in infrastructure. Finding a larger group of countries that can coordinate well enough to replicate this is a daunting challenge. While the world may be flattening, there are still some hills at the borders.