What smart Startups will learn from Big Tech and Bitcoin’s collapse
Picking sides in politics might seem like good business, but in government, its a short lived race to the bottom
Too many equate “government” with “politics” and when you get into it, the two couldn’t be farther apart. Smart operators know this and opportunists pay the price of failing to learn this lesson.
Politics is easily defined as "the debate or conflict among individuals or parties having or hoping to achieve power" when government is simply defined as "the body that governs.” The definitions themselves couldn't be more different, and so are their practical applications.
When someone refers to “government service” the connotation is almost universally positive, as people see any work in government as a service to others. However, when someone is referred to as a “career politician” well, you can hear the venom spew because that connotation is no longer about government participation, but conflict, power, and self interest instead of the common good.
This is representative of the difference in how people distinguish between the logical end of politics and the means of work in the service of others. Startups, companies, and the general public for that matter, need to understand “Politics” is inherently self serving and on the face of it, there’s nothing wrong with that. Despite our best intentions, how can people aiming to shape a single government to advance their interests not by their very nature be self-serving?
Applying that logic, startups that wish to become more savvy in the government space should do their best to remain apolitical and avoid joining factions. Too often, the knock on startups on both sides of the aisle follows a similar trajectory. One side accuses the startup world of partnering with one faction over the other, and the other side accuses them of not being aligned enough to that particular faction. Startups are walking themselves into a circular firing squad of their own making.
As we’re seeing, no one, particularly the emerging tech industry benefits from this. This is the result of a short sighted, ham-handed approach to trying to play politics and forgetting about how the government behind the politics actually works and makes decisions. Smart startups can and should have a moral or political compass. However, they need to - as a foundational position understand the levers of power - and be removed from the mess of politics and have a government strategy that supports their business model over their personal politics. The ROI for government relations is undeniable and startups will never realize it only playing half the field.
This is the paradoxical aspect of government relations. Part art and part science, government relations is just like building a startup. You enter the fray hoping to put your positive spin on the universe and if you’re lucky, bend the arc of history in the right direction. Smart operators know once you see an opportunity to advance your mission and enrich yourself. This is where the difference between passing a law or getting a good valuation applies. When your fortunes are tied to others’ suffering or gain, your moral compass should kick in as you realize someone might lose by you winning. Unlike in business, when it comes to the government, you’re now faced with a choice.
In the normal course of business, any startup would do whatever it takes to get the best valuation possible as their survival incentivizes them to do so, just as a politician is required to save their skin over a tough vote or thorny policy issue arises. That said, the initial goal of making things better is much harder to see in the fray, both in government and with startups. The easiest way to stay true to your initial goals is to avoid politics and focus on a smart, long term and measured government relations strategy that is sustainable irrespective of party control because once you pick sides, you can never go back without paying the price.
Trading smart, strategic engagement for becoming an ally might play well in the short term and political realm, but it never builds broad-based buy-in across the aisle over the long term. Winning in politics means failure in government overtime for most companies, again, just look at the absolute disaster blockchain and tech is in today.
Despite extreme overtures to their political allies, they forgot to build broad political coalitions and they’re getting crushed and on the verge of extinction as a result. If they have them, they should fire their political consultants. But frankly, they’ve got no one to blame but themselves. They failed the most basic lesson of politics, and it was the government -most ironically- their political allies that are leading them to slaughter, and now no one, not even Matt Damon can save them.
Startups need to get off the sidelines and to smartly engage with the whole of government.
Politics are better for Twitter than the balance sheet.
Let’s get tech and startups off the sidelines, off of a team, and take the first step and start building for the future.