Movers & Shakers
The Winklevoss Twins: The Past, Present and Future
Winklevoss Twins , Principals at Winklevoss Capital
The atmosphere at ZURB HQ was positively electric when Tyler (@tylerwinklevoss) and Cameron (@winklevoss) Winklevoss dropped by our offices. We had a lot of fun as we chatted with the twins about where they've been, where they are and where they're going. They answered our questions with a combination of good humor and great insight.
Tyler and Cameron were very upfront about their early days at Harvard and shared their thoughts on the movie that immortalized their story, "The Social Network." More than that, they talked about what it takes to be a leader who is capable of transforming a great product into a great business. We were also lucky to get the inside scoop on their latest venture, Winklevoss Capital. The new company, which they co-founded, focuses on early-stage startups.
Feel free to listen to the podcast as you read through the summary of the event below.
Becoming Angel Investors
After having retired from professional rowing, the Winklevoss twins spent time trying to figure out what their next step would be. They'd liked the idea of becoming angel investors and helping younger entrepreneurs. As Cameron said:
Through our journey, we have experience that we can impart and lend to people and bestow on younger guys.
The Winklevoss twins have acquired some 5,000-square-foot office in New York to create an incubator where startups in the New York tech scene can work on their products without having to worry about paying for a three-year lease. As they put it, the office would be an ecosystem where people can come in and grow.
However, the twins are still getting their ducks in a row and haven't firmed up any deals yet. Although, they did give us the scoop on who they are looking at, including a company trying to solve sizing for buying clothes online. Another company is in financial tech and another is in the cloud-service space. When asked if it was Yottabyte, which is working to build the first operating system for the cloud, the twins just said they're in conversation with them. As Cameron put it, they aren't looking at one particular industry:
When we look at companies, we look toward the team, the entrepreneur and what problem they are solving.
They said they looking for entrepreneurs who levered themselves into their idea, either by bootstrapping it or seeking the help of their friends and family. Cameron said:
If they can't sort of sell their friends and family on it, then why should they be able to sell me on it.
The twins said they've had a lot of outlandish pitches, everything from the next Facebook killer to "it's going to make Google look like peanuts." When it comes to pitches, simpler is better, said Tyler.
We like simplicity and things that are simple that can be understood in one or two sentences. You can distill Google or Facebook or any of these companies in a couple of sentences. If you can't do that, then it's probably a pie in the sky type of thing.
Cameron had another way of looking at it.
If you can't get up in front of a group of people and they can't grab onto it right away, then that's your first problem.
"6'5, 220 pounds and there's two of me."
Cameron and Tyler's story began eight years ago at the dawn of Web 2.0 in a Harvard dorm room as co-founders of ConnectU. A story that was immortalized on the silver screen in "The Social Network." Both agreed that the movie was a great piece of entertainment that should've won Best Picture. The film lost to the "King's Speech" in 2011, if you were wondering. Here's how Cameron viewed the film:
The goal of the film was to tell the story from three different perspectives, similar to a "Rashomon," sort of a reconstructing of the crime scene, if you will. As a result, the goal is not to draw a black-and-white conclusion. It's to create a grey area and [you have to] sort of grab onto to any character and defend them and support them.
Cameron said there were documents and facts out there that make the story much clearer. However, he doesn't blame the filmmakers for their approach. However, one shouldn't rely on the film as the sole authority on the events that transpired in that 18-month period. Of course, the twins were flattered to have the best line in the movie:
I'm 6'5, 220 pounds and there's two of me.
That line appears on Cameron's Twitter bio.
Trying to Solve a Social Problem
With ConnectU, the Winklevoss twins were trying to solve a social problem. The problem, especially at Harvard, was that once you get into your major it's nearly impossible to meet everyone in your class, let alone the entire school. The twins were trying to solve that problem with a tactile solution that "allowed our fingers to do the walking."
At the time, however, there was no startup culture. They faced the problem of finding talent that could help them make ConnectU become a reality. As we all know, they recruited a young Mark Zuckerberg to join their team. But then they discovered that Zuckerberg built what was then known as "Thefacebook," which eventually became the Facebook that we all use and know. They found out by reading about it in the school newspaper.
The twins said it wasn't naivete on their part — it's just that you don't think a fellow student to do that. Of course, there was a string of 52 emails over three months without a mention that Zuckerberg was working on another project. As Cameron said:
We weren't supposed to see it coming.
The twins didn't run to the courts immediately, but instead went to then-Harvard President Larry Summers — a meeting, the twins said, was very much like it was seen in the movie. They described the president's attitude as dismissive. Harvard takes academic dishonesty seriously, but not dishonesty between fellow students, said the twins. It's an issue that needs to be talked about more seriously, said Cameron.
It's a dialogue that has not happened and needs to happen.
Evaluating a Leader
When it comes to Mark Zuckerberg, the twins believe that a lot of Facebook's growth and success has been credited to one man. Cameron used the analogy of a plague. No one ascribes a plague to one man, it has that viral quality, which is what Facebook had. All that was needed was to keep the serves on and it would continue to grow, said Tyler. He also put it another way:
We think it was a team effort and he deserves credit, but we deserve some too — that's what we were fighting for.
Cameron viewed it another way:
Now is really when you start evaluating a leader, and saying, "OK what are you going to do with these billion people? How are you going to build a business?" It really starts today or three months ago. And that's when a leader is shown. You have to ask yourself, if you were to take Mark and put him in another company, can he lead that company? That's a question that a lot of people would say they're not sure. But if you took someone like a Jeff Bezos and put him in Facebook, he could figure that machine out.
Facebook's IPO and the Dictator's Dilemma
Leadership and governance came up when talking about Facebook's recent IPO. When it came to why the stock took a sharp nose dive, Cameron said that nothing was left on the table for retailers and anyone else that wanted to be part of it. There was also a question of whether Facebook was fully prepared, especially when it came to making money from mobile, despite it being plastered all over the social network's IPO filing. As Cameron put it:
You have a situation where mobile was something you could see a year out and so it's confusing why it's all of a sudden, we have to monetize for mobile.
They likened the situation of Facebook and mobile to Saddam Hussein believing he actually had weapons of mass destruction, or at least according to one theory they heard from a journalist covering that particular story. The theory goes that Saddam's lieutenants told him that those weapons existed to save their own skins. Believing those weapons were in his arsenal, Saddam fought hard to keep the inspectors out of the country.
It's like the emperor has no clothes. If you don't have the governance and the structure in place and the people who could challenge you and give the hard questions. And if you're not doing your job, kick you out.
It's sorta the Dictator Dilemma — you're not necessarily getting the right feedback.
Cameron said Facebook should have seen mobile a year or two beforehand, especially since they knew they'd be going IPO. The twins said that Facebook is focused on the user experience and there's not really a lot of talk about building a great business. Cameron put it this way:
In order to build a great product, you need to have the resources to plow back into it. Nobody from Apple would be discouraged to say, "we have a tremendous business, it's very profitable, we've got a $100 billion of cash on the books." They're proud of that aspect. I don't see Facebook describing themselves as trying to be a tremendous business and I don't see why you can't have both, and, ultimately, you need both. If you don't, someone is going to come across and take your engineers and eat your lunch, and the product will suffer as a result.
Tyler agreed, adding that Facebook floated their IPO too much. He said:
Everyone got caught up in that users equal revenue and that's not always the case.
Pop Culture Icons
As for being pop culture icons, the twins said they're flattered that someone felt their story was compelling enough to make a movie. They've embraced it. Although, they never saw it coming when they sought out to create ConnectU, all those years ago. As Tyler said:
We set out to start a website in 2002 and never predicted it [would have] gone this way. It did; we'll take it in stride. It's exciting and again we're flattered that people are interested in the story and we're excited to start our next chapter.
Our conversation continued as Cameron and Tyler took questions from the audience, including how it felt to work with your twin on so many different projects. We'd like to thank the Winklevoss twins for stopping by ZURB HQ and to all who attended the event.