Seth Bannon, the 28-year-old creator of an app for non-profits called Amicus, lied about going to Harvard, didn't pay taxes, lost millions of dollars of his investors' money, and alienated his friends. His apology for all this startup CEO pissery reads like a shopping list for every Valley disorder under the sun.
The New Republic's Noam Schreiber published the full story of Bannon's decline and fall earlier this week. Read it! But what's most striking about the tale isn't all the gross mismanagement that took place, the scores of naive investors, and the one douchebag with an app—it's what Bannon did when he got caught. Besides fire almost everyone.
In The Hard Thing About Hard Things, Ben Horowitz says "nearly every company goes through life-threatening moments… it's so common that there is an acronym for it, WFIO, which stands for 'We're Fucked, It's Over.'"...This was our first WFIO.
No, Seth, you fucked up! Not your team, whom Schreiber reports had "gone months without workers compensation insurance, something New York State requires."
Bannon moves on to how he didn't pay taxes, and his excuse is very believable for a guy who created a software company: "There was a single "submit tax" button in a separate part of the Bank of America website that had to be clicked to actually pay the taxes." You missed it, big guy.
In the end, Bannon says "such a huge financial shock severely hurt our runway and triggered many difficult changes. This hurt even more because I'd been paying myself one of the lowest salaries on the team." Bannon also notes that he had "little tolerance for paperwork, forms, or bookkeeping, and so had been putting off some operational tasks for too long." Ok.
Next, Bannon apologizes for "not being explicit about hacks," and by hacks he means "lies."
In the early days I would often let potential customers think we already had a feature they wanted and, if they signed, would come back to the team and say "we've got to build this before they launch!"...This is a tactic commonly suggested by lean practitioners.
"Lean practitioners" is my new favorite euphemism for, oh I don't know, crooks?
Finally, Bannon makes peace with the world for lying about going to Harvard. It's OK to not go to Harvard—preferable, really—but Bannon deceived people in order to get money from them, and that's not OK by most faith or value systems:
Before Amicus, I was enrolled in the bachelor's degree program at the Extension School at Harvard University – a small program with a few hundred graduates a year. At the time, I considered it a good hack, as I was getting, as the New York Times put it "Harvard at a fraction of the cost."...Partly for convenience and partly to make for a good story, I would often say I dropped out of "Harvard University."
But that's not a hack. It's a lie. To be a shitty person isn't to have "hacked society," or been "lean with the truth"—it's just being callow, and wrong, and bad. No amount of innovating away from sincerity will change that.