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Should You Drink the
          Kool-Aid?
                           Venkatesh Rao

With contributions from:
•   Greg Rader
•   Kevin Simler
•   Jane Huang
•   BAR Group


              11.27.2012 | USC Annenberg Innovation Lab
If the odds of making it as a [rockstar | movie star |
       entrepreneur | best-selling author | President] are so
       completely awful, why do people still try?




12/6/2012            Venkatesh G. Rao               2
the usual answer: PASSION AND TRUE BELIEF

            the common motif is KOOL-AID




12/6/2012          Venkatesh G. Rao           3
…very hard to study…
  “Death wish” …
       PASSION
           +
      TRUE BELIEF




                                      IRONY
                                        “Acting Dead” – Bruce Sterling




12/6/2012          Venkatesh G. Rao                 4
Speculative


              Simulation                          Fiction
        game theory models                  anecdata, gossip, TV shows,
        agent based models                  movies, cartoons, narrative
        long-term historical sims           theories, personality theories We’ll mostly be
        what-ifs                            histories, biographies,            hyann
                                            media stories, blog posts,

  Numbers                                   Thick Description           Stories
                 Science
  Duckworth Grit scale                    interviews, longitudinal studies a la Vaillant
  institutional talent flow patterns      embedded reporting
  macroeconomic studies                   fund-raising war stories
  Kauffman type research                  incubator lore
  correlations, distributions             hacks, metis of startuppery
                                  Conservative



12/6/2012                Venkatesh G. Rao                          5
Backstory: Gervais Principle (2009)


                                        True Believers




12/6/2012      Venkatesh G. Rao     6
initial attempt to map model to startups…circa 2009

                                                VCs


                                                Founders

                                                Option
                                                Lottery
                                                Players




12/6/2012         Venkatesh G. Rao          7
long story short, 4 years later, this became…

     “Entrepreneurs are the New Labor”
                                  …to polarized reactions

            • “You nailed it!”
            • “That has not been my experience”
            • “This whole thing is stupid, you can’t
              analyze this way”



12/6/2012             Venkatesh G. Rao              8
not insiders vs. outsiders
not investors vs. founders
not winners vs. losers


            only difference: different cognitive processes

            viewed different types of argument as valid




12/6/2012        Venkatesh G. Rao          9
The Clue at Quantico


                  “We use Myers-Briggs/Keirsey here in
                  the Marine Corps…most of us are SJ
                  types… Guardian/Protector… very
                  passionate, very emotional…”




12/6/2012           Venkatesh G. Rao            10
If an important decision is to be made [the Persians] discuss the
    question when they are drunk, and the following day the master
    of the house. . . submits their decision for reconsideration when
    they are sober. If they still approve it, it is adopted; if not, it is
    abandoned. Conversely, any decision they make when they are
    sober is reconsidered afterwards when they are drunk.

                                                              – Herodotus




12/6/2012               Venkatesh G. Rao                     11
Narrative Approach


               Character vs. Situation vs. Plot

                               http://tempobook.com




12/6/2012   Venkatesh G. Rao                 12
Probabilities don’t change when drunk….

                                          What’s the point of this
     I should be thankful for
                                          so-called life? I might
       my good, secure job,
                                            as well die. I AM
        others have it even
                                               QUITTING
     worse. This startup idea
                                           TOMORROW AND
       is not worth the risk.
                                           DOING A STARTUP.




               But subjective utilities do…
12/6/2012              Venkatesh G. Rao              13
So what happens when* you fail?




     * rounded up from if

12/6/2012            Venkatesh G. Rao   14
Courage Wolf Meme

12/6/2012    Venkatesh G. Rao   15
Dutch Courage Wolf Meme




12/6/2012      Venkatesh G. Rao       16
Alan: Wait a minute, that’s your big secret? Alcohol?
     Charlie: Shhh. Don’t tell anybody.
     Alan: But isn’t that just a temporary solution.
     Charlie: It’s only temporary if you stop drinking.
     Alan: I like it.

            Something Salted and Twisted [3.10] - Two and a Half Men
            http://www.youtube.com/watch?v=AtituB9WRQU

12/6/2012                  Venkatesh G. Rao                     17
If an important decision is to be made [the Persians] discuss the
    question when they are drunk, and the following day the master of
    the house. . . submits their decision for reconsideration when
    they are sober. If they still approve it, it is adopted; if not, it is
    abandoned. Conversely, any decision they make when they are
    sober is reconsidered afterwards when they are drunk.

                                                              – Herodotus



                  what happens if you never sober up?


12/6/2012               Venkatesh G. Rao                     18
The reasonable man adapts himself to the world; the
            unreasonable one persists in trying to adapt the
            world to himself. Therefore, all progress depends on
            the unreasonable man.

                                                          – Shaw




12/6/2012              Venkatesh G. Rao              19
drunk = punch drunk?




            Dragline: Stay down. You're beat.
            Luke: You're gonna hafta kill me...
12/6/2012         Venkatesh G. Rao         20
“Learn to fetishize the pain of learning something new”

                                         -- Andrea Kuszewski


12/6/2012         Venkatesh G. Rao             21
more than a death-wish though…


                                 What’s the point of this
                                 so-called life? I might as
                                      well die. I AM
                                       QUITTING
                                   TOMORROW AND
                                  DOING A STARTUP.




12/6/2012     Venkatesh G. Rao               22
Grit*

             unwavering                  P      urpose
  an UNFALSIFIABLE mission that cannot be invalidated
  by any amount of A/B testing or “customer
  development” or reframed away with “pivots”

  *Google “Duckworth grit scale…” for a more empiricist take…

12/6/2012             Venkatesh G. Rao                 23
Mattie Ross: Who's the best Marshal?
            Sheriff: Hmm, I'd have to think on that….



12/6/2012             Venkatesh G. Rao         24
“Bill Waters is the best
             tracker. He's part Comanche;
             it is a pure joy to watch him
             cut for sign.”



     This is the hacker-entrepreneur, see THE
     TURPENTINE EFFECT
     /

12/6/2012        Venkatesh G. Rao            25
“…The meanest is
                        Rooster Cogburn; a
                        pitiless man, double
                        tough. Fear don't enter
                        into his thinking….”

12/6/2012   Venkatesh G. Rao             26
“…I'd have to say the fairest is
               L.T. Quinn; he always brings
               in his prisoners alive. Now, he
               might let one slip by every
               now and then, but...”

      This is the PRAGMATIC actor who sees no problem with
      ACQUI-HIRING and other REASONABLE ADAPTATION
      models


12/6/2012          Venkatesh G. Rao           27
Mattie Ross: Where would I find this Rooster?




12/6/2012             Venkatesh G. Rao        28
to achieve unreasonable things, find someone
  with a death-wish and leash them to a Purpose




12/6/2012      Venkatesh G. Rao       29
BUT…
            What happens when DOZENS of Matti Rosses
            need HUNDREDS of Rooster Cogburns?




12/6/2012           Venkatesh G. Rao          30
can true grit be scaled?




12/6/2012       Venkatesh G. Rao   31
• Ancestor of Matti Ross
                                   • Founder of cult of assassins
                                   • Originator of fedayeen*

                                   "They call him Shaykh-al-Hashishim.** He is
                                   their Elder, and upon his command all of the
                                   men of the mountain come out or go in...
                                   they are believers of the word of their elder
                                   and everyone everywhere fears them, because
                                   they even kill kings."
  Hassan-i Sabbah
    (1050 – 1124)
                                                            - Benjamin of Tudela

*from Wikipedia: “someone who redeems himself by risking or sacrificing his life”

** etymology/story of assassin == hashashin == hashish possibly apocryphal, but military-
political-guerrilla tactics are not
12/6/2012                Venkatesh G. Rao                       32
Kool-Aid Characterized
     Cognitive capture by a nascent organization
     at the edge of existing institutions defined by
     us-versus-them discourses based on
     boundaries created out of trial-by-fire
     bonding experiences




12/6/2012         Venkatesh G. Rao           33
The passion is sacred

       patterns of argumentation that threaten it are
       systematically delegitimized

                this is both a strength and a weakness




12/6/2012         Venkatesh G. Rao       34
Code RED: extra-judicial killings




       We use words like honor, code, loyalty. We use these words as the backbone of
       a life spent defending something. You use them as a punchline. I have neither
       the time nor the inclination to explain myself to a man who rises and sleeps
       under the blanket of the very freedom that I provide, and then questions the
       manner in which I provide it.

                                                                       -- Col. Jessup




12/6/2012               Venkatesh G. Rao                       35
In the 1960s and 1970s, classic social psychological studies were conducted that
provided evidence that even normal, decent people can engage in acts of extreme
cruelty when instructed to do so by others. However, in an essay published November
20 in the open access journal PLOS Biology, Professors Alex Haslam and Stephen
Reicher revisit these studies' conclusions and explain how awful acts involve not just
obedience, but enthusiasm too—challenging the long-held belief that human beings
are 'programmed' for conformity.

http://medicalxpress.com/news/2012-11-human-obedience-myth-
conformity.html#jCp

12/6/2012               Venkatesh G. Rao                       36
Sociopath moral code          Kool-Aid law
              (no institutions)             (emerging institutions)
  The meanest is Rooster
  Cogburn; a pitiless man,
  double tough. Fear don't enter
  into his thinking….
                                            Rule of law
                                            (established institutions)


                              …I'd have to say the fairest is
                              L.T. Quinn; he always brings
                              in his prisoners alive. Now,
                              he might let one slip by every
                              now and then, but...

12/6/2012        Venkatesh G. Rao               37
“If you’re not actually doing a startup,
                                            you don’t get to talk…or at least, I don’t
                                                      have to listen to you.”




                                                                often “big company people”
                                                   “building”
                         “passion”
      We use words like honor, code, loyalty. We use these words as the
      backbone of a life spent defending something. You use them as a
      punchline. I have neither the time nor the inclination to explain myself to a
      man who rises and sleeps under the blanket of the very freedom that I
      provide, and then questions the manner in which I provide it.

                                                    “wealth/jobs”


12/6/2012                Venkatesh G. Rao                           38
“You can’t handle the truthiness”




12/6/2012     Venkatesh G. Rao   39
True wolves are rare                      Sheep+Kool-Aid creates scalability

                                           40
12/6/2012              Venkatesh G. Rao
Jung for “Startup Scene”
                            (with help from Greg Rader)
ESFJ                       ENFJ                      ESTP                       ENTP
        Pillar of               Social                      Player                     Inventor
       Community             Revolutionary                           (Se/Ti)                  (Ne/Ti)
                 (Fe/Si)               (Fe/Ni)
ESTJ               ENTJ               ESFP                ENFP
   “New Labor”          Hustler            Promoter        Conference Goer
           (Te/Si)            (Te/Ni)             (Se/Fi)             (Ne/Fi)

ISTJ                INTJ              ISFP                 INFP
 New Org Rank+File       Hacker            Loyalist        “Sharing Economy”
            (Si/Te)           (Ni/Te)              (Fi/Se)             (Fi/Ne)

ISFJ                       INFJ                   ISTP                 INTP
        Pillar of                  Idealist        Organization Man Armchair Thinker
       Community                          (Ni/Fe)              (Ti/Se)         (Ti/Ne)
                 (Si/Fe)


 12/6/2012                        Venkatesh G. Rao                             41
http://www.xeromag.com/fun/personality.html

ESFJ                ENFJ               ESTP               ENTP
  Control Freak        Cult Leader          Conman          Mad Scientist
            (Fe/Si)            (Fe/Ni)            (Se/Ti)            (Ne/Ti)

ESTJ                ENTJ               ESFP                 ENFP
    Bureaucrat        Evil Overlord     National Enquirer     Scientologist
            (Te/Si)            (Te/Ni)      Headline                   (Ne/Fi)
                                                    (Se/Fi)
ISTJ                    INTJ                  ISFP                     INFP
       Thought Police       Outside                  Crackpot                 Idealist
              (Si/Te)      Contractor                       (Fi/Se)                  (Fi/Ne)
                                  (Ni/Te)
ISFJ                  INFJ                ISTP                  INTP
       Martyr             Conspiracy        Psycho Vigilante         Egghead
              (Si/Fe)      Theorist                     (Ti/Se)            (Ti/Ne)
                                  (Ni/Fe)


 12/6/2012                 Venkatesh G. Rao                           42
WARNING: neither prescriptive nor descriptive

 Jung/Myers-Briggs measures preferences

 You don’t always get what you want….




12/6/2012    Venkatesh G. Rao     43
Belief Types
OUTSIDERS      OLD INSTITUTION STEWARDS OUTSIDERS
Non-Drinkers       Champagne Kool-Aid   Home-brewers




VANGUARD               TRUE BELIEVERS    VANGUARD
Happy hour              Koolaidaholics   Party drinkers




OUTSIDE        OLD INSTITUTION STEWARDS OUTSIDERS
Non-Drinkers          Social drinkers   Non-Drinkers




12/6/2012      Venkatesh G. Rao              44
Tragedy                                   Farce
     (early part of an economic age)           (late part…)




12/6/2012              Venkatesh G. Rao   45
Col. Jessep: You want answers?
    Kaffee: I think I'm entitled to…
    Col. Jessep: *You want answers?*
    Kaffee: *I want the truth!*
    Col. Jessep: *You can't handle the
    truth!*
    ….

    Either way, I don't give a damn
    what you think you are entitled to.



12/6/2012           Venkatesh G. Rao      46
“In the work and its profits the Nation was an
       essential partner and equally entitled with the
       individual to share in the dividends.”

       -- Andrew Carnegie, Gospel of Wealth II (1906)




12/6/2012          Venkatesh G. Rao          47
Which side is right?


            For every complex problem there is an answer that is clear, simple,
            and wrong. – H. L. Mencken




12/6/2012                Venkatesh G. Rao                        48
For every complex problem there is an answer that is clear, simple,
             and wrong. – H. L. Mencken




            In the spirit of phillosophical bipartisanship, it would be pleasant to
            conclude that each of these traditions of political economy
            [Hamiltonian and Jeffersonian] has made its own valuable contribution
            to the success of the American economy… but that would not be true.

            What is good about the American economy is largely the result of the
            Hamiltonian developmental tradition, and what is bad about it is
            largely the result of the Jeffersonian producerist school

                                              -- Michael Lind, Land of Opportunity




12/6/2012                  Venkatesh G. Rao                        49
H
                                    NASA                  Big Military, Big Corps,
                National Parks                            Big Banks
                             Rockefeller
                         FDR             J. P. Morgan
     Big Welfare State        Carnegie
                                         Eisenhower
                                          Hoover
                    Teddy Roosevelt                GI Bill
                 Morrill                  OSRD-DARPA
                           NSF, NIH
                    #Occupy
        L                                                              R
                    Startup Scene               Reagan
                                                  Manifest Destiny
                 Hippie
                                            Homestead Act
                 Movement
                                      Thomas Jefferson
        Transition/Permaculture                           Tea Party
            Locavorism                               Andrew Jackson
                                 J
     Startups are weird because they start out Jeffersonian
     but nurse deep Hamiltonian ambitions
12/6/2012                Venkatesh G. Rao                        50
Planned
              2014



               http://gameofpickaxes.com/
12/6/2012         Venkatesh G. Rao          51
Tentative Conclusions
•   Kool-Aid is how you scale true grit
•   It works through cognitive capture
•   Takes unironic passion, not all can do it
•   It drives institutional creative destruction
•   Transient phase moral hazard




12/6/2012        Venkatesh G. Rao       52

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Usc annenberg

  • 1. Should You Drink the Kool-Aid? Venkatesh Rao With contributions from: • Greg Rader • Kevin Simler • Jane Huang • BAR Group 11.27.2012 | USC Annenberg Innovation Lab
  • 2. If the odds of making it as a [rockstar | movie star | entrepreneur | best-selling author | President] are so completely awful, why do people still try? 12/6/2012 Venkatesh G. Rao 2
  • 3. the usual answer: PASSION AND TRUE BELIEF the common motif is KOOL-AID 12/6/2012 Venkatesh G. Rao 3
  • 4. …very hard to study… “Death wish” … PASSION + TRUE BELIEF IRONY “Acting Dead” – Bruce Sterling 12/6/2012 Venkatesh G. Rao 4
  • 5. Speculative Simulation Fiction game theory models anecdata, gossip, TV shows, agent based models movies, cartoons, narrative long-term historical sims theories, personality theories We’ll mostly be what-ifs histories, biographies, hyann media stories, blog posts, Numbers Thick Description Stories Science Duckworth Grit scale interviews, longitudinal studies a la Vaillant institutional talent flow patterns embedded reporting macroeconomic studies fund-raising war stories Kauffman type research incubator lore correlations, distributions hacks, metis of startuppery Conservative 12/6/2012 Venkatesh G. Rao 5
  • 6. Backstory: Gervais Principle (2009) True Believers 12/6/2012 Venkatesh G. Rao 6
  • 7. initial attempt to map model to startups…circa 2009 VCs Founders Option Lottery Players 12/6/2012 Venkatesh G. Rao 7
  • 8. long story short, 4 years later, this became… “Entrepreneurs are the New Labor” …to polarized reactions • “You nailed it!” • “That has not been my experience” • “This whole thing is stupid, you can’t analyze this way” 12/6/2012 Venkatesh G. Rao 8
  • 9. not insiders vs. outsiders not investors vs. founders not winners vs. losers only difference: different cognitive processes viewed different types of argument as valid 12/6/2012 Venkatesh G. Rao 9
  • 10. The Clue at Quantico “We use Myers-Briggs/Keirsey here in the Marine Corps…most of us are SJ types… Guardian/Protector… very passionate, very emotional…” 12/6/2012 Venkatesh G. Rao 10
  • 11. If an important decision is to be made [the Persians] discuss the question when they are drunk, and the following day the master of the house. . . submits their decision for reconsideration when they are sober. If they still approve it, it is adopted; if not, it is abandoned. Conversely, any decision they make when they are sober is reconsidered afterwards when they are drunk. – Herodotus 12/6/2012 Venkatesh G. Rao 11
  • 12. Narrative Approach Character vs. Situation vs. Plot http://tempobook.com 12/6/2012 Venkatesh G. Rao 12
  • 13. Probabilities don’t change when drunk…. What’s the point of this I should be thankful for so-called life? I might my good, secure job, as well die. I AM others have it even QUITTING worse. This startup idea TOMORROW AND is not worth the risk. DOING A STARTUP. But subjective utilities do… 12/6/2012 Venkatesh G. Rao 13
  • 14. So what happens when* you fail? * rounded up from if 12/6/2012 Venkatesh G. Rao 14
  • 15. Courage Wolf Meme 12/6/2012 Venkatesh G. Rao 15
  • 16. Dutch Courage Wolf Meme 12/6/2012 Venkatesh G. Rao 16
  • 17. Alan: Wait a minute, that’s your big secret? Alcohol? Charlie: Shhh. Don’t tell anybody. Alan: But isn’t that just a temporary solution. Charlie: It’s only temporary if you stop drinking. Alan: I like it. Something Salted and Twisted [3.10] - Two and a Half Men http://www.youtube.com/watch?v=AtituB9WRQU 12/6/2012 Venkatesh G. Rao 17
  • 18. If an important decision is to be made [the Persians] discuss the question when they are drunk, and the following day the master of the house. . . submits their decision for reconsideration when they are sober. If they still approve it, it is adopted; if not, it is abandoned. Conversely, any decision they make when they are sober is reconsidered afterwards when they are drunk. – Herodotus what happens if you never sober up? 12/6/2012 Venkatesh G. Rao 18
  • 19. The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man. – Shaw 12/6/2012 Venkatesh G. Rao 19
  • 20. drunk = punch drunk? Dragline: Stay down. You're beat. Luke: You're gonna hafta kill me... 12/6/2012 Venkatesh G. Rao 20
  • 21. “Learn to fetishize the pain of learning something new” -- Andrea Kuszewski 12/6/2012 Venkatesh G. Rao 21
  • 22. more than a death-wish though… What’s the point of this so-called life? I might as well die. I AM QUITTING TOMORROW AND DOING A STARTUP. 12/6/2012 Venkatesh G. Rao 22
  • 23. Grit* unwavering P urpose an UNFALSIFIABLE mission that cannot be invalidated by any amount of A/B testing or “customer development” or reframed away with “pivots” *Google “Duckworth grit scale…” for a more empiricist take… 12/6/2012 Venkatesh G. Rao 23
  • 24. Mattie Ross: Who's the best Marshal? Sheriff: Hmm, I'd have to think on that…. 12/6/2012 Venkatesh G. Rao 24
  • 25. “Bill Waters is the best tracker. He's part Comanche; it is a pure joy to watch him cut for sign.” This is the hacker-entrepreneur, see THE TURPENTINE EFFECT / 12/6/2012 Venkatesh G. Rao 25
  • 26. “…The meanest is Rooster Cogburn; a pitiless man, double tough. Fear don't enter into his thinking….” 12/6/2012 Venkatesh G. Rao 26
  • 27. “…I'd have to say the fairest is L.T. Quinn; he always brings in his prisoners alive. Now, he might let one slip by every now and then, but...” This is the PRAGMATIC actor who sees no problem with ACQUI-HIRING and other REASONABLE ADAPTATION models 12/6/2012 Venkatesh G. Rao 27
  • 28. Mattie Ross: Where would I find this Rooster? 12/6/2012 Venkatesh G. Rao 28
  • 29. to achieve unreasonable things, find someone with a death-wish and leash them to a Purpose 12/6/2012 Venkatesh G. Rao 29
  • 30. BUT… What happens when DOZENS of Matti Rosses need HUNDREDS of Rooster Cogburns? 12/6/2012 Venkatesh G. Rao 30
  • 31. can true grit be scaled? 12/6/2012 Venkatesh G. Rao 31
  • 32. • Ancestor of Matti Ross • Founder of cult of assassins • Originator of fedayeen* "They call him Shaykh-al-Hashishim.** He is their Elder, and upon his command all of the men of the mountain come out or go in... they are believers of the word of their elder and everyone everywhere fears them, because they even kill kings." Hassan-i Sabbah (1050 – 1124) - Benjamin of Tudela *from Wikipedia: “someone who redeems himself by risking or sacrificing his life” ** etymology/story of assassin == hashashin == hashish possibly apocryphal, but military- political-guerrilla tactics are not 12/6/2012 Venkatesh G. Rao 32
  • 33. Kool-Aid Characterized Cognitive capture by a nascent organization at the edge of existing institutions defined by us-versus-them discourses based on boundaries created out of trial-by-fire bonding experiences 12/6/2012 Venkatesh G. Rao 33
  • 34. The passion is sacred patterns of argumentation that threaten it are systematically delegitimized this is both a strength and a weakness 12/6/2012 Venkatesh G. Rao 34
  • 35. Code RED: extra-judicial killings We use words like honor, code, loyalty. We use these words as the backbone of a life spent defending something. You use them as a punchline. I have neither the time nor the inclination to explain myself to a man who rises and sleeps under the blanket of the very freedom that I provide, and then questions the manner in which I provide it. -- Col. Jessup 12/6/2012 Venkatesh G. Rao 35
  • 36. In the 1960s and 1970s, classic social psychological studies were conducted that provided evidence that even normal, decent people can engage in acts of extreme cruelty when instructed to do so by others. However, in an essay published November 20 in the open access journal PLOS Biology, Professors Alex Haslam and Stephen Reicher revisit these studies' conclusions and explain how awful acts involve not just obedience, but enthusiasm too—challenging the long-held belief that human beings are 'programmed' for conformity. http://medicalxpress.com/news/2012-11-human-obedience-myth- conformity.html#jCp 12/6/2012 Venkatesh G. Rao 36
  • 37. Sociopath moral code Kool-Aid law (no institutions) (emerging institutions) The meanest is Rooster Cogburn; a pitiless man, double tough. Fear don't enter into his thinking…. Rule of law (established institutions) …I'd have to say the fairest is L.T. Quinn; he always brings in his prisoners alive. Now, he might let one slip by every now and then, but... 12/6/2012 Venkatesh G. Rao 37
  • 38. “If you’re not actually doing a startup, you don’t get to talk…or at least, I don’t have to listen to you.” often “big company people” “building” “passion” We use words like honor, code, loyalty. We use these words as the backbone of a life spent defending something. You use them as a punchline. I have neither the time nor the inclination to explain myself to a man who rises and sleeps under the blanket of the very freedom that I provide, and then questions the manner in which I provide it. “wealth/jobs” 12/6/2012 Venkatesh G. Rao 38
  • 39. “You can’t handle the truthiness” 12/6/2012 Venkatesh G. Rao 39
  • 40. True wolves are rare Sheep+Kool-Aid creates scalability 40 12/6/2012 Venkatesh G. Rao
  • 41. Jung for “Startup Scene” (with help from Greg Rader) ESFJ ENFJ ESTP ENTP Pillar of Social Player Inventor Community Revolutionary (Se/Ti) (Ne/Ti) (Fe/Si) (Fe/Ni) ESTJ ENTJ ESFP ENFP “New Labor” Hustler Promoter Conference Goer (Te/Si) (Te/Ni) (Se/Fi) (Ne/Fi) ISTJ INTJ ISFP INFP New Org Rank+File Hacker Loyalist “Sharing Economy” (Si/Te) (Ni/Te) (Fi/Se) (Fi/Ne) ISFJ INFJ ISTP INTP Pillar of Idealist Organization Man Armchair Thinker Community (Ni/Fe) (Ti/Se) (Ti/Ne) (Si/Fe) 12/6/2012 Venkatesh G. Rao 41
  • 42. http://www.xeromag.com/fun/personality.html ESFJ ENFJ ESTP ENTP Control Freak Cult Leader Conman Mad Scientist (Fe/Si) (Fe/Ni) (Se/Ti) (Ne/Ti) ESTJ ENTJ ESFP ENFP Bureaucrat Evil Overlord National Enquirer Scientologist (Te/Si) (Te/Ni) Headline (Ne/Fi) (Se/Fi) ISTJ INTJ ISFP INFP Thought Police Outside Crackpot Idealist (Si/Te) Contractor (Fi/Se) (Fi/Ne) (Ni/Te) ISFJ INFJ ISTP INTP Martyr Conspiracy Psycho Vigilante Egghead (Si/Fe) Theorist (Ti/Se) (Ti/Ne) (Ni/Fe) 12/6/2012 Venkatesh G. Rao 42
  • 43. WARNING: neither prescriptive nor descriptive Jung/Myers-Briggs measures preferences You don’t always get what you want…. 12/6/2012 Venkatesh G. Rao 43
  • 44. Belief Types OUTSIDERS OLD INSTITUTION STEWARDS OUTSIDERS Non-Drinkers Champagne Kool-Aid Home-brewers VANGUARD TRUE BELIEVERS VANGUARD Happy hour Koolaidaholics Party drinkers OUTSIDE OLD INSTITUTION STEWARDS OUTSIDERS Non-Drinkers Social drinkers Non-Drinkers 12/6/2012 Venkatesh G. Rao 44
  • 45. Tragedy Farce (early part of an economic age) (late part…) 12/6/2012 Venkatesh G. Rao 45
  • 46. Col. Jessep: You want answers? Kaffee: I think I'm entitled to… Col. Jessep: *You want answers?* Kaffee: *I want the truth!* Col. Jessep: *You can't handle the truth!* …. Either way, I don't give a damn what you think you are entitled to. 12/6/2012 Venkatesh G. Rao 46
  • 47. “In the work and its profits the Nation was an essential partner and equally entitled with the individual to share in the dividends.” -- Andrew Carnegie, Gospel of Wealth II (1906) 12/6/2012 Venkatesh G. Rao 47
  • 48. Which side is right? For every complex problem there is an answer that is clear, simple, and wrong. – H. L. Mencken 12/6/2012 Venkatesh G. Rao 48
  • 49. For every complex problem there is an answer that is clear, simple, and wrong. – H. L. Mencken In the spirit of phillosophical bipartisanship, it would be pleasant to conclude that each of these traditions of political economy [Hamiltonian and Jeffersonian] has made its own valuable contribution to the success of the American economy… but that would not be true. What is good about the American economy is largely the result of the Hamiltonian developmental tradition, and what is bad about it is largely the result of the Jeffersonian producerist school -- Michael Lind, Land of Opportunity 12/6/2012 Venkatesh G. Rao 49
  • 50. H NASA Big Military, Big Corps, National Parks Big Banks Rockefeller FDR J. P. Morgan Big Welfare State Carnegie Eisenhower Hoover Teddy Roosevelt GI Bill Morrill OSRD-DARPA NSF, NIH #Occupy L R Startup Scene Reagan Manifest Destiny Hippie Homestead Act Movement Thomas Jefferson Transition/Permaculture Tea Party Locavorism Andrew Jackson J Startups are weird because they start out Jeffersonian but nurse deep Hamiltonian ambitions 12/6/2012 Venkatesh G. Rao 50
  • 51. Planned 2014 http://gameofpickaxes.com/ 12/6/2012 Venkatesh G. Rao 51
  • 52. Tentative Conclusions • Kool-Aid is how you scale true grit • It works through cognitive capture • Takes unironic passion, not all can do it • It drives institutional creative destruction • Transient phase moral hazard 12/6/2012 Venkatesh G. Rao 52