The Dark Side of Silicon Valley: Beware of "Ballers on a Budget" and Posers in Tech

08/31/2016 09:55 am ET Updated Dec 06, 2017

2016-08-22-1471893266-9215485-RanaGujral.pngBy Rana Gujral

Last year, Kori Handy, co-founder of design app Sherbert, penned a candid Medium post about his decision to relocate his startup from the Valley to Seattle. Handy wrote that while he would miss the energy of Silicon Valley, he was tired of superficial entrepreneurs and the entire startup ecosystem that goes along with them: the so-called "posers" in tech.

"There are two groups of people there -- one that really hustles and builds stuff, and the other ones that are posers," Handy wrote. As someone who also identifies as being in the first group (people who "hustle and build stuff"), I certainly relate to Handy's frustrations with some of the Valley's inhabitants.

My own experience with the Valley has been mixed. I love the Valley's optimism, energy and excitement. But sometimes it can feel as if you're trapped in a funding merry-go-round. The thinking goes something like this: "Let's find funding first and then get tons of press (when we get funding), and then the user problem will take care of itself." Yikes! This approach is indicative of what's wrong with the Valley: a me-first world where power and clout matter more than actually building a product that works. This problem certainly is not new: Erica Douglas touched on it when she wrote back in 2011 why Silicon Valley is broken.

Valley Posers: Ballers on a Budget, Fake Mentors and Incubator Gators

In the Valley, many folks will talk a lot about their startup, but that doesn't mean they're actually creating a working product. Quora has an excellent guide to some of these Valley characters. They're the "Ballers on a Budget", "Fake Mentors" and "Incubator Gators" who are quick to attend a networking event, hop a flight to Vegas, or offer startup advice, but are slow to actually build anything of their own. Interacting with these characters on a daily basis can be a huge negative energy drain. Everyone is a "growth hacker," but no one is actually growing anything.

I experienced this firsthand when I served as a startup advisor. While I was still with my corporate job, one of my roles there was to build a team of startup advisors to provide actionable insights on strategy, execution and fundraising. New to the Valley, I was naively impressed by how freely people offered their time and advice. It didn't take long, however, to discover that many of these "generous advisors" actually had no real (or credible) entrepreneurial experience. They were professional networkers who sold access to their connections in exchange for stock options or cash kickbacks.

How to Survive (and Thrive) as a Newbie Entrepreneur in Silicon Valley

If you're not careful, it's easy to get caught up in the Valley's drama. Here's how to steer clear of the Valley's characters and build a startup you can be proud of:

  • Avoid a "fake it 'til you make it" mentality. "Fake it 'til you make it" is a phrase you hear a lot in startup culture. This type of thinking can be dangerous because it leads to a mentality where new entrepreneurs feel they must project an image of success and are reluctant to ask for real guidance. No matter where you are in your entrepreneurial career, never be afraid to seek - and implement - genuine feedback.
  • Discern genuine guidance from "fake mentoring." Yes, the "fake mentor" epidemic is real, but so too, are the genuine mentors who provide meaningful guidance. As I learned firsthand, it's not enough to just be open to feedback; it's essential to implement this feedback.

  • Ride the "boom-bust" cycle wave. There's a fundamental goal misalignment of funding over revenue, short-term growth over long-term business strategy, and buzz over product. But as Chris Yeh wrote in Social Media Today, "Every few years the Valley undergoes a new boom: personal computers, biotech, internet, Web 2.0, social... the posers will bring on the inevitable bust... the ecosystem will rid itself of the posers and renew itself." Understand this is a cycle and be ready to ride the wave.
  • Why I Chose Silicon Valley to Found My Startup

    Yes, the Valley is populated with some unpleasant characters. But for every poser you meet, there's someone who is genuinely committed to building an amazing company. They're smart, talented and optimistic. They're putting in the long hours and making the tough calls to build a product that changes the world. You may not meet these folks right away. You certainly won't find them at a massive networking event or jetting to Vegas for the weekend. That's because they're actually building a product, not just talking about building one. Most importantly, they're open to failure. That's the real secret behind Silicon Valley's magic: a willingness to fail.

    The odds of starting a successful company are slim to none. Even venture-backed companies have a pretty low success rate. But because the Valley does not penalize smart failure, we encourage more startup activity than any other place on Earth. This is the Valley's magic: It's why I am proud to call the Valley home and why I chose to found my startup here. The smartest, most talented people from all over the world surround me.

    So, what's a newbie entrepreneur in the Valley to do? Don't let yourself get caught in the drama. Just keep validating your product. Surround yourself with a team that's smarter than you and proactively seek (and take) their advice.

    Let your product do the talking for you.

    Rana Gujral is an entrepreneur, CEO and investor. Rana is the co-founder of TiZE and is involved with several startups.