I Rest My Case, This is War

6/16 UPDATE:  Here’s a really informative graphic as to what’s happening in the U.S. related to skilled workforce requirements.  The most compelling points?  1) By 2015, 60% of the new jobs will require skills possessed by only 20% of the population, and 2) In 1991, by contrast, less than half of the jobs in the U.S. required skilled workers.

______

One of my recent posts discussed the war for engineering/developer talent, particularly in the Bay Area.  It’s getting worse and I just don’t see how it is sustainable.  Here are some recent additional data points related to the overwhelming demand for engineering talent:

  • A recent Techcrunch article discussed some analysis by TopProspect, an emerging online recruiting destination, that shows analytically who is winning among the top technology companies – Facebook, Google, Twitter, Zynga and others.
  • Check out this blog post by Gordon Hempton on “What It’s Like to Be Recruited“.  It details Gordon’s experience of posting his resume and subsequently receiving 266 emails and 96 voice mails from companies and recruiters, most of whom ignored his very specific job request for mobile development and instead were recruiting him for a broad range of development positions and platforms.

What is clear from this and other analysis is that we are in a zero sum game right now.  Meaning, there are simply not enough quality engineers entering the market to come close to the demand, there’s a nearly fixed pool of talent trying to supply both incredible existing company growth and the startup ecosystem.  The result is an all out war, including underhanded PR stunts, espionage and poaching that results in some companies winning (Facebook, Zynga, LinkedIn and Groupon) and others losing (Google, Microsoft, EBay and Yahoo) in talent acquisition.

I’ll refrain from calling this a talent bubble, as I hate the term bubble for what’s happening in tech right now – it brings back too many bad memories from 1999/2000 when this term was coined and was far more appropriate.  Because I went through the original bubble, I know what is happening now is vastly different.  We are investing in real companies now.  Sure, valuations are high, but newly funded businesses for the most part have real products and customer traction which was not the case a decade ago.

However, much of the talent population, engineers in particular, are too young to have been through the 1999 bubble, so I worry about soaring egos, mercenary behavior and lack of perspective which defined attitudes in 1999.  Engineers were hiring their own agents back then.  Put yourself in their shoes.  Young guns getting constant calls from recruiters, offers to leave their current positions for 25+% compensation and perk increases, which they can repeat from employer to employer.  Tempting, right?

I gotta believe that the demand/supply equation will balance itself, it always does.  But how long will it take?  To the engineers I say good for you, take advantage of the opportunity while it exists, but be careful.  Things have a way of coming back to center.  Put value in building great product, team loyalty and product ownership in addition to your career path and compensation.  See your work through.

Fortunately, this is exactly what I’m seeing at least in the engineers I’ve had the pleasure of working with.  Motivations seem much broader today than they were 10 years ago and attitudes and perspectives towards what is happening in the talent marketplace seem much more balanced, which is refreshing.

Why is this?  I think its because the role of the engineer has changed from pure coding and taking orders from business folks to now having a deeper role in product development and far more empowerment around solving technical problems.  With the proliferation of technology platforms and languages, there are many ways to solve complex technical challenges and the engineers are leading these efforts, they are closest to the product and thus enjoy increasing levels of autonomy in their work.

It’s a great time to be an engineer!  And a frustrating time being a company trying to find the best ones.

Advertisements

Tech is Alive in Austin

I just spent two packed days in Austin, TX connecting with members of the technology startup community, both entrepreneurs and also the investment community.  I also had a chance to spend some overdue quality time with my two nieces, Zoe (2) and Shelby (9 months).  My brother Chris lives in Austin and is part of a group of entrepreneurs and investors that are really shaping Austin’s present and future role in fostering a comprehensive environment for companies to launch and thrive.

Austin grew up in the early 90’s as a technology community hub, particularly in Enterprise Software and Hardware, as the birthplace of Dell, Tivoli, Vignette and Trilogy among others.  Today, slowly but surely there seems to be a newer crop of companies emerging in Consumer Internet and Mobile – HomeAway and BazaarVoice being two successful examples – and a whole slew of new and exciting startups that are getting funding locally through Austin Ventures, Silverton Partners, NEA and even outside of Austin from firms such as Boulder-based Foundry Group.  Startup programs such as Capital Factory and Startup America Partnership, in addition to the large and local University of Texas, are helping to perpetuate and grow Austin’s track record of starting, scaling and exiting new businesses all while enjoying a great quality of life.

I was really energized by what is happening in Austin and look forward to my next visit.

One thing is clear, people love living in Austin and they rarely leave.  And if they do, they come back.  Exciting times in the heart of Texas.

The Next Government Buster?

I’ve read a few really interesting stories over the past few days about Bitcoin, a relatively new, decentralized peer-to-peer (P2P) payment ecosystem that avoids any sort of centralized banking oversight and is anonymous between the transacting parties.  Think about these two attributes for a second.  No centralized government oversight means no regulation, no taxation, no monitoring of how and where currency is being spent, no traceability, no monetary policy.  And anonymous between the parties, in combination with no oversight, means you can buy and sell things – any and all things – without anyone knowing what is bought or sold.  While there are other forms of P2P payment systems such as PayPal in operation, none of them meet these two criteria.  How Bitcoin works is fascinating.

Jason Calacanis, arguably one of the most influential web technology voices and certainly one of the most outspoken about new and emerging web technologies, posted a story about Bitcoin yesterday entitled Bitcoin P2P Currency:  The Most Dangerous Project We’ve Ever Seen.  The gist of his message is that this could be one of the most disruptive web technologies since the creation of the Internet itself due to the potential dis-intermediation of governments and the complete decentralization of a globally centralized system (monetary oversight, central banking).

There was an insightful response to Jason’s post by Robert Tercek, a serial innovator in digital media, entitled Is Bitcoin the Wikileaks of Monetary Policy? that is a must-read.  Robert describes how the Internet has decentralized numerous industries, particularly ones where the incumbents were able to previously control their positions with regulation or by proprietary access to data or licensing.  He sums it up with “Bitcoin is to central banking as Gnutella is to music publishing, as BitTorrent is to motion pictures and as Wikileaks is to government secrets.”

Jason and Robert contend the only way this type of innovation is stifled is by governments making it illegal AND actively prosecuting individuals.  And even this type of threat at best forces a migration of innovation into even more diffusion and decentralization until local government incentives are aligned with the innovation.  In the end, centralization and oversight die.  Wikileaks and Napster started revolutions that spawned even more decentralized and ultimately more effective web innovation.

I wonder, is this capitalism at work?  Can we assume that the intersection of innovation and economics will always result in the most efficient, effective equilibrium?  Or are there areas of centralization, policy and oversight that are beneficial to society as a whole?

This will be one technology to watch.

Your Phone Will Control Your Home

We knew it was coming, but Google finally today announced Android@Home, Google’s new open framework to allow your Android mobile device to (eventually) control everything in your home – music, lighting, security, cameras, doors, appliances, you name it.  I think the “home” is a next big frontier of unexplored opportunity and is going to create an entire new ecosystem of startups and companies focusing on the intersection of mobile and home.  While Microsoft (Kinect), IBM and HP have been in this home sensor space for years, Google has a history of changing the game and bringing new technologies to the masses through their open development platforms.  Google Chrome OS, with 160M users and Android, with exponential growth and now the leading mobile operating system in the world, are two examples of Google’s ability to create explosive products and platforms.

Over just the past decade, we’ve seen a migration in opportunity from initially web only, then to mobile smartphones, then to mobile connectedness to others through applications and social media, which by the way is not nearly fully exploited yet.  It seems with Google’s announcement today, at least one next evolution of connected technology is our mobile device as a true connector to everything in our lives – people, home, car and every activity that fills our day.

Consistent with other Google applications, Android@Home is an open platform that encourages any developer to create applications that operate on the platform.  Google with their worldwide influence, has a unique ability to define and lead game changing technologies by first defining the platform standard, then opening it up for developers everywhere to create applications, increasing consumer adoption and ultimately leading to exponential scale.  Google’s vision in this case is to create a “smart home” by having millions of developers building applications that over time will completely automate your home through your mobile device.  Pretty cool George Jetson stuff that he might have developed at Spacely’s Sprockets!

I’m excited to see what will happen over the next 12 months in the home automation space now that Google has officially entered the market.

Now, if only Google could create a platform for increasing home values to 2005 levels, I’d really be impressed 🙂

Engineer = Rock Star

It’s good to be a developer in this job market.  Really good.  And not just in Silicon Valley, although SV really is the center of the universe for mobile and web technology.

At TrueCar, we’ve been really aggressive with hiring for both our LA and SF offices, including offering relocation packages from anywhere in the U.S., even for junior engineers.  We’re selling our story hard.  Here’s what we’ve been up against over the past year:

  • Google recently gave every employee across-the-board 10% raises – up from already strong compensation.
  • Large Silicon Valley companies like Google and Facebook are actually acquiring small startups, in some cases only a few months old, to gain access to the development team.
  • Poaching talent from competitors has become a fine art, escalating signing bonuses to extreme amounts for top talent.  As incredulous as a $500K retention bonus sounds, the economics of that decision for a company like Google makes perfect sense based on the shareholder value that lead engineer will create.  Oh, and 15% of Facebook’s employees have previously worked for Google.
  • In Boulder, a consortium of companies are pooling money to fly in engineers from around the country to attend Boulder Startup Week beginning in a few weeks on May 18.

Compounding the challenge is the fact that its probably the best time in tech history to be an entrepreneur and start your own company.  There’s efficient access to capital and mentoring through firms like AngelList, YCombinator and TechStars and valuations are soaring, encouraging top technical talent to do their own thing, which is exactly what is happening, effectively removing top engineering talent from the labor pool.  How crazy is it that top engineers leave Google, start their own company, get acquired within a year and end up back at Google as an employee?

It’s a downright war for talent right now.

My Favorite Twitter Follows

I wanted to follow up a prior post on my favorite startup blogs with a post on a handful of my favorite Twitter follows.  These are a group of folks, most of whom I only know by reputation, that have something to say or news to share about technology, startups or entertainment.  As I mentioned previously, Twitter has become a go-to source of news and insights for me, an incredibly efficient way to absorb a lot of information quickly.  Enjoy!

News, Technology & Startups

  • @TrueCar – of course.
  • @TechCrunch – the leading startup blog, news feed.  Good iPhone app too.
  • @TEDNews – news source for incredible human innovations
  • @venturehacks – Startup advice
  • @nytimes – Also on my iPhone
  • @cnnbrk – CNN Breaking News
  • @GOOD – An association of “pragmatic idealists” focusing on issues of Good in the world
  • @Oxfam – An international group of 15 organizations across the world developing solutions for poverty & injustice.
  • @bfeld – Brad Feld, VC and prolific blogger, highlighted in a prior post.  Highly active on Twitter.
  • @msuster – Mark Suster, Entrepreneur turned VC, very active blogger and on Twitter.
  • @sacca – Chris Sacca, Entrepreneur and early investor in Twitter.  Highly active.
  • @Bill_Gross – Founder of Idealab and 100 other companies over 30 years
  • @tferriss – Tim Ferriss, author of “4-Hour Work Week” and “4-Hour Body”.  Interesting and unique.
  • @fredwilson – Highly regarded VC and daily blogger.
  • @cdixon – Chris Dixon, entrepreneur founder of Hunch.
  • @davemcclure – Founder of 500startups, a seed fund and startup accelerator.
  • @hnshah – Hiten Shah, Co-Founder of KissMetrics, great insights for entrepreneurs.
  • @bhorowitz – Ben Horowitz, Founder of LoudCloud turned VC.  Phenomenal blog that I inadvertently left off my previous post.

Entertainment & Other

  • @SudsNYC – Sudhir Kandula, a friend and top 3 finalist in “America’s Next Great Restaurant”.
  • @playgrounddad – Connecting modern dads with products/events that help them spend better time with their kids.
  • @StartupJesus – Fake Jesus, runs a startup that is “going to change the world”.  Of course it will.
  • @ConanOBrien – love his humor and his show.
  • @BorowitzReport – Andy Borowitz, hilarious quips on current events.  King of the one-liners.
  • @donttrythis – Adam Savage, host of Mythbusters
  • @TheOnion – America’s finest fake news source
  • @bobsaget – ever since he appeared on Entourage, I can’t get enough of him.
  • @shitmydadsays – Justin who lives with his 74-year old dad.  4-letter word alert, but freakin’ funny.

What are some great Twitter follows that I missed?

4D Ultrasound, Wonderful and Creepy

On Monday Renee and I went for our non-medical, baby-in-the-belly-for-entertainment 4D ultrasound.  This procedure is where they use a skin-level view imaging system in combination with the ultrasound to give 3D views of your unborn child plus movement (thus the 4D).  We spent about an hour with the technician poking, prodding and moving Renee into various positions to give us the most non-creepy view possible of our little one.  It was wonderful and creepy at the same time as evidenced by the picture.  Renee’s family will be happy to know that Baby G has her nose and mouth!


%d bloggers like this: