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58 viewsHans G. Schantz, 17:50

Forwarded from MILO

SVB escaped proper scrutiny for two reasons. One, because it built a potemkin crystal palace for itself at the heart of the American tech establishment, which for decades succeeded brilliantly at turning journalists into supplicants while outright lying to their customers. SVB inherited the halo of the sector they served, which had since the 1990s used one simple trick: They bored us all shitless telling us over and over again, in all kinds of different ways, how unthreatening, friendly and nice they were, until we had no choice but to believe them.

Google, Apple, Facebook and others positioned themselves as perky, helpful, happy and harmless--even a little infantile--and just here to help! They gave themselves stupid names, used palettes considered inane and childish at the time, spoke in a relentlessly cheerful tone (which some of us found creepy and sinister, but most people just accepted), while also spending AN ABSOLUTE FUCKING TON of money buying loyalty from more skeptical demographics, like bankers and politicians. And, for years, people bought it. Big Tech was spying on people, selling their data, manipulating or restricting their free expression and compromising their safety and privacy from day one. But it was only a few years ago that the press went from default positive to default negative on tech companies--and even that was driven by the economics of media, and not by principle.

Branding and marketing works. It didn't obscure their abuses forever, but it provided years of coverage during which some of the most powerful, arrogant, reckless and socially corrosive corporations in the history of capitalism operated with no oversight, and in fact no interest at all, from anyone. Big Tech used the time wisely, growing rich, powerful and sophisticated far beyond the regulatory and enforcement capabilities of any government. It is now effectively impossible to police what Google does. We don't know what they're doing, we don't know why, and we don't know when they're lying. We have no way to find out, either. Google is now, in effect, a medium-sized country strategically scattered across the globe for maximum financial and political advantage. All we can do is pray that their interests align with ours.

It's in that context that SVB operated, inheriting the halo of the optimistic, growing startup culture with which politicians love to associate themselves. But the palace was constructed in haste and using illegal labor. Founders have been sharing stories about how SVB's systems kept failing. One company had to get an Excel spreadsheet mailed to them of their customer's credit card transactions that month, because SVB's computer systems were outdated, failing and totally inadequate for such a large organization. But the founders, too, fellow members of the "move fast and break things" philosophy that gave us beta products at finished prices, forgave the bank these highly alarming failures, because SVB used a second PR strategy: It presented itself as a scrappy young company instead of a stuffy financial instution in order to woo startup founders by signalling that the bank was just like them--the implication being that it would understand the unique challenges of high-growth companies and serve them better than anyone else.

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53 viewsHans G. Schantz, 22:19