If there's one thing San Francisco's tech scene doesn't suffer from, it's a dearth of dreams. Crash one of the city's many geek meet-ups or cocktail hours and you'll see them percolating everywhere. You'll also see any number of bright-eyed folk awaiting their chance at stardom.
There's Gabe Benveniste, who left his job at Pixar to start a music social network in 2007, and had to fund it with personal credit cards — he says the dust settled when he was acquired by a larger company last year. There's Brandon Peele, the Berkeley-based, guayabera-wearing founder of EVR1, a company that makes tiny handicrafts with storage disks that contain “the greatest works of the Eastern and Western canon.” Peele currently has three employees, but he'd love to be as big as, say, Coca-Cola or Microsoft. There's Markus Rokitta, the German engineer who currently lives in an AirBnB-rented room, and who worries about finding a job in San Francisco's cutthroat hardware industry. He came to a tech happy hour in SOMA with old business cards stuffed in his wallet, only to find a dozen similarly skilled product developers who were also muscling for work.
Helming a start-up is tantamount to being a Hollywood ingénue, or jockeying for a place in the NFL draft. Benveniste says the highs and lows are often intolerable: “Every day is the best and worst of your life.”
Then there are the people who shill the dream factory, often by acting as intermediaries between cash-strapped entrepreneurs and the venture capitalists who can help them. Networking is so important in Silicon Valley that it's spawned a whole cottage industry and with it, a professional class whose sole purpose is to connect the idea-generators to the king-makers.
Among them is Myles Weissleder, a public relations specialist who cut his teeth in the early days of the Internet — he ran global communications for Meetup.com from Sausalito — and who now helms SF New Tech, a for-profit network in San Francisco.
Weissleder doesn't exactly fit the prototype for a man in a gray flannel suit: He's got a sweet tooth for clichés, he answers to the nickname “Myler Dude,” and his Gchat status is a quote from a happy client — something about “uncontainable awesomeness.” But he's still a consummate wheeler-dealer. Weissleder founded the SF New Tech meetup back in 2005, and eight years later he's still drawing 200 people to its monthly gatherings at Club Mighty.
That's particularly impressive given the price of admission: $399 for an annual membership; $350 to demo your product for an audience of “early adopters”; $15-$30 to join that audience. In a scene now swelling with meet-ups and hack-a-thons that provide similar perks for free — Meetup.com currently boasts 541 “tech” groups in the Bay Area — some of Weissleder's peers are surprised that he can still make a living.
But Weissleder isn't alone, and he isn't particularly greedy. In fact, SF New Tech is oft considered a poor man's alternative to deeper-pocketed ventures like The DEMO Conference, which promises wide exposure and media attention for a fee of up to $18,500. The idea is that if you can pitch your product to insiders while it's still in Beta, then you have a much higher chance of surviving in an environment where failure is the norm.
But that's the thing, critics say. Very few start-ups survive long enough to even get funding, no matter how good the concept or how smooth the elevator pitch. Even Weissleder acknowledges that most of the people who demo their products at SF New Tech are making a Hail Mary pass. In their case the stakes are pretty low — if you can't afford to drop $350 on your business, you may as well call it a day — but Weissleder sees other businesses charging a much higher premium for their services, sometimes with promises they can't deliver.
Over the past year, Silicon Valley has become a hotbed for high-priced residential programs, boot camps, “accelerators,” and incubators, such that it's become hard to distinguish the ones offering tangible rewards from the ones just trying to make a buck. A few months ago, famed venture capitalist Timothy Draper launched Draper University of Heroes from a hotel in San Mateo. For $7,500-$9,500 tuition, students get intensive training in “heroism” — and access to Draper's sprawling Rolodex.
“We're trying to inspire our students to be superheroes and change agents,” explains Draper University's chief operating officer, Carol Lo, when asked what justifies the high sticker price. She rattles off a list of “influential industry leaders” who visited during the pilot semester. Some, like Napster founder Shawn Fanning, and disgraced JC Penney CEO Ron Johnson, are actually high-profile failures.
Weissleder regards many of these programs warily. “Some of them will give you the promise that you have a high chance of getting investment based on certain relationships they've set up with a venture capital firm,” Weissleder says. “The return is you walk out [with] a Series A round of funding — then you've won.” He adds that, for all the eye-batting and elbow-rubbing and old-fashioned dreams of being discovered, most young companies fail, regardless of where they launch their first product demo.
That's enough to raise eyebrows among Silicon Valley skeptics, and rankle people like Jason Calacanis, the entrepreneur who crusaded against Keiretsu Forum, a giant angel investor network, for predatory behavior in 2009. Calacanis deemed it “low-class” for the rich and well-connected to exploit the poor and starry-eyed. Weissleder says that “exposure” is 10 times more powerful than sending a resume cold, but it's not a guarantor of success.
Steffen Frost, who pitched an abortive rideshare app at SF New Tech in 2009, says he found the opportunity valuable — if only to get his name out there and practice speaking in front of an audience. At that time he'd hoped to make his company “too big to fail.”
It eventually failed. He's just glad Weissleder wasn't charging a demo fee back then.