Take Zynga. It was a high-flying startup, whose stock price in the early days was near $15. Today it's trading at about $2. Pincus had to step down as CEO and chief product officer in April of this year.
Uber still seems to be riding high, but bad publicity may well take its toll, with numerous high-profile people abandoning the service and deleting the app, according to TheNew York Times. Kelly Hoey, a New York-based angel investor, deleted her Uber account because of privacy concerns, telling the Times, "I don't want them to have my information, my credit card or my name." Lisa Abeyta, founder and CEO of the tech startup APPCityLife, did the same, adding, "There is a difference between being competitive and being dirty. It is bad-boy, jerk culture. And I can't celebrate that." And Minnesota Senator Al Franken has written a scathing letter to Kalanick saying that Uber's actions "suggest a troubling disregard for customers' privacy, including the need to protect their sensitive geolocation data."
One of Silicon Valley's most prominent investors, Paul Graham, believes that investing in jerks (his term) is not just a kind of bad karma, but bad for business as well. Graham heads the prominent startup accelerator Y Combinator, which has helped launch countless successful startups, including Dropbox and Airbnb, and he won't invest in companies run by people he considers jerks.
He told Business Insider, "The reason we tried not to invest in jerks initially was sheer self-indulgence. We were going to have to spend a lot of time with whoever we funded, and we didn't want to have to spend time with people we couldn't stand. Later we realized it had been a clever move to filter out jerks, because it made the alumni network really tight ... based on what I've seen so far, the good people have the advantage over the jerks. Probably because to get really big, a company has to have a sense of mission, and the good people are more likely to have an authentic one, rather than just being motivated by money or power."
So don't think the bad buys always win. Sometimes they do get their comeuppance.
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