Will 2023 be the year we stop idolizing tech entrepreneurs?
In Ancient Rome, where the public was enthralled by celebrity culture and helped elevate and sink reputations, 2022 would have been labeled an annus horribilis for cultish business leaders.
Given the recent fall from eminence of several headline-generating bosses, could 2023 be the year people – including investors – finally become more careful not to be hoodwinked by technology entrepreneurs and even snub them altogether? Moreover, have we reached “peak idolatry of innovators,” as suggested by Scott Galloway, clinical professor of marketing at New York University Stern School of Business?
Galloway noted that around 87% of the 8-billion-strong human population identified with a religion. “We have decided that they [tech entrepreneurs and innovators] are our new Jesus Christ,” he said in a 2023 Predictions webinar in early December. “There’s no religion that’s ever rivaled technology in terms of its influence and power, and the heads of technology companies are our idols.”
Or at least they were. Galloway calculated that the wealthiest leader in the tech space had a 33% chance of being named Time magazine’s person of the year. However, the “gross, nonsensical adoration” of celebrity innovators may have reached the pinnacle after “a tough couple of months for the ‘Church of Technology,’” he added.
In November 2022, Stanford University dropout Elizabeth Holmes, the founder and CEO of Theranos, a now-defunct health organization that promised to revolutionize blood testing, was sentenced to over 11 years in prison for fraud.
In the same month, Massachusetts Institute of Technology graduate Sam Bankman-Fried, aka SBF, the founder and CEO of cryptocurrency exchange FTX, lost 94% of his net worth, which peaked at $26 billion, in a day, according to the Bloomberg Billionaires Index. It marked the largest 24-hour drop in the index’s history.
Lack of due diligence
In both cases, many influential people took the declarations of these cultish entrepreneurs at face value. With SBF, there were “red flags everywhere,” said Galloway. He incorporated FTX in the Bahamas, a tax haven, the organization didn’t have an executive board, and there were no audited financial records. And yet, SBF was trusted because “he’s from MIT and has the word ‘billions’ next to his name.”
It is here that “the venture capitalist community,” which lobbies to reduce regulations to enable innovations to fly, deserves blame, argued Galloway. The pressure on governments to not establish or remove safeguards combined with “this ideology of innovators [has] protected total fraud and resulted in an absolute destruction of billions of dollars of retail investors’ capital,” he said.
The downfalls of Holmes, SBF, and others highlight the criticality of investors conducting due diligence on individuals behind the helms of businesses, as well as the businesses themselves, before investing, stressed Alastair Hazell, a U.K.-based entrepreneur and the founder of The Calculator Site. Doing so will help to build a better picture of “inherent risks, and considering the long-term potential,” he said.
“It is also important for investors to be aware of the potential for hype and bold claims to cloud their judgment and to be cautious of investing in companies or individuals based solely on their promises or charismatic personalities,” added Hazell.
In this regard, the above two instances, and the extraordinary sums involved, should tighten regulations. As a result, in 2023, “we will see more people in orange jumpsuits,” Galloway predicted.
Elon Musk is another example of a nosediving megastar leader. Reflecting on the former wealthiest person in the world’s erratic behavior, especially at the helm of Twitter in recent months, Galloway said in December that Musk had “warranted accolades for his incredible vision and genius, but I think he’s lost the script.”
Musk and personal brand
James Owen, co-founder and director of the online marketing firm Click Intelligence and a private investor, agreed that Musk’s conduct on the social media platform has earned him few new fans since he took over Twitter for $44 billion in October. Further, Musk’s actions in charge of Twitter sullied his personal brand and negatively impacted the reputations of related organizations, including Telsa.
So why are people drawn to wealthy tech innovators? Before Musk, Bill Gates and Steve Jobs, among others, were idolized. “People often seek guidance, inspiration, and role models, and personal brands can provide a way for individuals to connect with others who share similar values or goals,” said Owen.
Musk knows that to connect with more people, he must be different from typical CEOs and portray himself as “more playful [and] less serious,” suggested Owen. Referencing Marvel’s fictional inventor and playboy behind superhero Iron Man, he said: “Musk leverages his position as a real-life Tony Stark to make himself seem more relatable, creating goodwill in consumers who will see him as ‘just like us.’”
The mask is slipping, though. As more supposedly pioneering and unorthodox leaders are revealed not to be what they purport to the outside world, the level of cynicism grows. “As a society, we are slowly relinquishing these tech giants’ hold on us,” said Owen. “The many recent controversies have shown these tech giants are people to scorn instead of admire.”
Indeed, a trend is emerging. WeWork’s co-founder Adam Neumann and Travis Kalanick, co-founder of Uber, are two other examples in the last few years of leaders initially hero-worshipped but then disgraced – respectively, when reality didn’t match the grand vision and when toxic work practices came to light.
The list goes on. Jaco Vermeulen, CTO of digital transformation consultancy BML Digital, said: “Mark Zuckerberg lost his shine a few years ago and is desperately trying to cling to it through the metaverse. Gates is not much in the picture anymore, and Tim Cook has never been viewed in the same haloed light as Jobs.”
Positives and negatives of social media
Zuckerberg, of course, was revered as co-founder of Facebook, which remains one of the most popular social media platforms, and his company expanded by acquiring WhatsApp and Instagram. Ironically, tech entrepreneurs – not least Musk – have used such channels to elevate themselves, but these platforms have quickly turned the tide of public support against them.
“Social media has played a role in fuelling the rise of personal brands by providing a platform for individuals to share their ideas, thoughts, and experiences with a large audience,” said Hazell. But, conversely, social media can also “amplify negative aspects of personal brands,” he added.
Corinne Card, co-founder of Full Story Media, works with mission-led tech entrepreneurs to help them tell their stories to the media and when they’re seeking investment. She believes that in 2023, people will be less wowed by wealthy pioneers. “As a society, we’re disillusioned by ‘tech geniuses’ who relentlessly build fortunes with no interest in how what they’re doing is making a difference in the world,” she said. “This year, we will see more mission-led entrepreneurs measured for how their work positively implicates society.”
Mike Morini, CEO of WorkForce Software, said that now more than ever, people are looking to trustworthy and transparent – rather than flashy and boundary-pushing – business leaders to help them through this period of uncertainty on both micro and macro levels.
“Leaders in 2023 should be admired for being clear, honest, and empathetic,” said Morini. He stated that most staff would accept clearly explained business-lead choices and if they felt engaged in the decision-making process.
“That means being open and honest about the business’s reality before decisions are made and talking frequently and consistently about the organization’s financial position to avoid staff making rash choices based on fear,” added Morini.