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On August 30, 2018, I appeared as a guest on the TechIsh podcast, alongside Michael and Abadesi. The episode was released on September 4. Below you can find the audio (embedded from SoundCloud) as well as an abridged transcript (some parts were truncated).

My startup

Wendy: My background is in the tech industry, but right now I’m not really a tech worker anymore - I mostly write about tech from the point of view of almost an outsider.

So I’ve been programming since I was pretty young. I worked as a software developer for a while: I interned at Google in uni, and then I started my own tech company that lasted about three years before I realised I hated it. I hated everything I was doing and I was just really burnt out and sick of that world.

So I spent a lot of time reading books. And in the process of doing that, I discovered politics - that [it] wasn’t just something to participate in passively and watch on the news, but something that I could actually do in my life.

These days, I mostly write about tech from a very political perspective, and I do political activism as well.

Abadesi: Why did you hate running your startup? There are so many people that are dreaming of the day they quit their full-time job to be their own boss. What did you not enjoy about that?

Me: I’ve actually written a longer form retrospective about my startup and why it was so bad, called Silicon Inquiry. The startup was something that I started right after graduating from uni, and it was building on research that I’d done while at a computer science lab in my undergrad. It wasn’t the exact same, but it the technology that I had been working on was something that could easily be commercialized.

At the time, I was trying to debate between going to work at Google full-time, or doing something else. And because I’d interned there the summer before, and I didn’t really enjoy working there, I was like, I want to do anything else - anything other than working full-time at Google, I will do it.

And so the startup opportunity came up with some friends of mine, and we did it. And it was definitely something we dove into without really knowing much about it - we had no idea what we were doing. We had this idea that because we were these kids, we were full of energy, someone would just give us money, and we would succeed, and within a year we would have a ton of revenue.

Obviously, that’s a very difficult thing to achieve. We did manage to raise some money, and we did manage to get some customers, but it took over a year before we were able to actually make profit, and we didn’t pay ourselves for this time.

I mean, I loved it for a while, [while] we were trying to figure out what we were building, who we were going to sell to. It was initially positioned as this data science start-up, and we were going to take data from social media companies who were using data from Facebook and Twitter or whatever, and we were going to help them process it. [But] then we just kept pivoting, until we found that the easiest way to actually make money in this space was to combine our data on people’s social media presence with emails.

A company like Urban Outfitters can say, we have all these emails of people who sign up for a newsletter or shop on our website, and we want to know how can we best target these people more efficiently. Which of these people likes yoga? Which of these people is a musician or something? We were able to provide some of that data.

And there was a time when I was like, this is such a cool technical problem, because I was the one building the tech and I really loved it - I really loved the challenges of scaling this really complex system. But then after a while - after the [buzz of the] technical challenge that wore off - I was thinking about what we were actually doing. What we were doing was helping Urban Outfitters sell a few more t-shirts.

And at the end of the day, I was like, I’m giving up 70-80 hours a week of my life for this. I’m barely doing anything else except this startup. My whole world is this startup. I looked back on my last few years, [realising,] I’m not proud of what I’ve achieved.

It was a bit like this awakening, this realisation that yes, startups can be a great escape from your day job that you hate. But it only makes sense if it’s something you actually want to do - if it’s something where you feel like you are making a useful impact on the world, something that’s useful for society.

I was thinking about what I’d built, and the fact that we had so many other competitors who we were constantly trying to stay ahead of all. These other people who were doing the exact same thing as us. Our technology wasn’t that special. I was proud of it, but that didn’t mean it was useful. It didn’t mean that if our technology died tomorrow, the world would really care. And I was thinking, do I really want this to be something I keep working on? I’d already given about three years of my life to it.

There was a time when I was like, I just can’t do it any more. This is not worth it.

Abadesi: I wonder what would it take for you to work full-time on a start-up again. Would it have to be something that has a social impact explicitly, or be something quite mission driven? This is quite a leading question because it’s one of our new stories.

Wendy: Definitely. I’ve expanded my idea of what’s possible, essentially. Because there was a time when I thought of the world in a very individualistic way. I thought, the world as it is, it’s mostly fine, and all I have to do is take my place in it: get the best job I can or start the best company I can.

But now I’m starting to see the world as more contingent, more socially constructed, and that there’s a lot of potential in trying to actually change the social and political environment of that, as opposed to just functioning within today’s political landscape (like building a company based on what’s making a lot of money now).

What I really don’t like about the startup world right now is that the incentives are terrible. If you look at some of the startups that are being funded - venture capitalists are not funding what needs to be solved. Anyone who tries to do a startup - if they want to do one that is socially driven, it’s going be hard to get funding. It’s gonna be hard to survive and be sustainable. The environment right now is not geared for startups that are producing social value - it’s geared towards things like $400 juicers.

Social enterprises vs deep tech startups

Michael: The story is based on an article for a platform that I run called I interviewed a really smart guy called Marcus Carey, and he’s about mid-30s, founder of a cybersecurity startup, and he raised about 3-4 million.

I asked him, do you have any tips for people that want to raise money? And he said - I’ll get the exact quote here, I’ll read it verbatim - he says:

What I see from people of color (and I do think our hearts in the right place a lot of times), is we focus on social ventures too much. I do a lot of mentoring, and we tend to want to be the “Martin Luther King” of technology or make some big social change. I wish more people focused on building “pure tech plays” because I think we can do that. I laugh when people say “Black Twitter” or “Black This” or “Black that; if we built our own platform it would make a significant difference.

So I’m just throwing that out there - I’m not saying I agree or disagree with any of it - but I want to hear what your take is, off the bat. Because all of us have run social ventures.

Abadesi: I think it’s like a really valid point, to some extent. I don’t actually agree with it. There are a lot of people of color working on big problems within tech: the CEO of FiveAI, an autonomous car company, is an Asian American woman. You were just talking about YC demo day a moment ago - a lot of the Nigerian companies in that cohort are focused on fintech issues: banking the unbanked, making it easier for companies to find capital.

I think the reason why it might feel like people of color founders focus on social issues is because that’s the only time the media talk about the things that we do. So it could be more like asymmetry of information, because of the signaling in the media. The stories that capture the headlines and capture attention are when people of color founders are working on problems that impact society. And then Elon Musk gets all the headlines about deep tech and other interesting things in AI. I don’t hate him; I hate the disproportionate amount of media attention he gets.

Michael: we both agree with that to be fair.

Abadesi: That said, if you think of the narratives that are perpetuated by successful founders - founders who have had exits, YC school of thought, Silicon Valley - you’re always encouraged to work on the problems that affect you. You’re always encouraged to work on the things that keep you up at night.

So, the things that keep people of colour up at night are things relating to institutionalised oppression. Inequities within society. So how can you blame people for choosing, in the very first instance of their entrepreneurship journey, to not work on a problem that is so personal and affects them.

Wendy: I think the other thing to consider is: beyond the media narrative and the fact that the media likes to cover certain stories, it’s also the fact that VCs like to fund certain types of startups. You have venture capitalists with certain biases, who will look at a person of color with a deep tech startup and they’ll be like, oh you don’t seem to meet this criteria. I don’t believe you’re able to do this.

Michael: Not a startup bro.

Wendy: And so they’ll look at a person of color who has a startup that is deep tech, and then they’ll just think, oh, this person probably can’t pull it off. I’m going to give my money to the Stanford bro, who is 19 years old and is about to drop out of Stanford, and has no experience, but fits the profile better. So you have have bias on both ends: the media side, but also the actual funding side.

I think what it really comes down to is: people should work on whatever they want to work on. Whatever drives them, whatever gets them up in the morning. And for some people, that will be addressing systemic oppression. For others, that will be addressing tech problems. I don’t think it’s a problem if people of color decide to work on a plurality of things. It’s not like there should be like one set path.

The other thing is, if people of color don’t work on these problems …

Abadesi & Michael: who’s going to work on them?

Venture capital and pattern-maching

Abadesi: You raised two really key things that I want to talk. About pattern matching: VC’s always talk about pattern matching, and they always talk about that being one of their skills. One of their superpowers. Sequoia and all of these big firms are so good at finding the next Mark Zuckerbergs of the world, because they can do pattern-matching very effectively. And I think you’re right - there is actually a limiting pattern matching process going on in the tech world, in Silicon Valley, where we associate underrepresented founders with underrepresented problems.

So maybe VC’s feel more confident investing in a black woman that’s building a product that does something for black women, than they would investing in a black woman that’s building a health tech solution with advanced AI.

Economic inequality

Abadesi: And then that point around who will solve these problems: I was just watching a lecture from a festival called the DO lectures, which happens in the UK every summer. And it’s the founder of an organization called SheEO: she quoted the statistic of how five people own the same amount of wealth as like 3.5 billion people. And that’s gone down from 18 people that held that half of the wealth just three years ago, which is terrifying. So there is a real urgency.

I’m a bit cynical and dystopian, but I’m always worried that there’s gonna be some crazy class war revolution kind of thing, where poor people are just like “Enough of this!” And that’s why all the billionaires are building their bunkers in the woods or in New Zealand or whatever. And we’re on the wrong side of that, because we’re too poor to build our own bunkers, but we’re also richer than the poorest people. So we’re gonna be …

Wendy: I think you’re right. Tech people will have to almost choose sides at a certain point. Especially if you want to forestall the revolution - if you want to make things better. Things are getting worse daily. And so it’s more and more urgent: are tech people going to be like, how do we help rich people stay rich? Or are we gonna address the actual deep economic inequality that’s causing so many problems right now?

Abadesi: The latter. For the record, we’re working on the latter.

Abolishing Silicon Valley

Michael: I was listening to another vlog that you were on: Novara Media. And you threw out the phrase “Abolish Silicon Valley”.

People always say me and Abadesi are super critical of tech, so I thought I’d bring somebody else who’s to the left of us.

Wendy: Okay, so first of all, it’s meant as a deliberately provocative thing. It’s mostly a joke. I’m not really saying we should actually abolish Silicon Valley or that it needs to be nuked or something.

It’s trying to get people to think about what Silicon Valley actually is in terms of the position that it occupies in the global economy. And specifically the fact that Silicon Valley is this very American phenomenon. If you consider the top companies in the world by market cap: of the top ten, five of them are tech: Microsoft, Apple, Amazon, Google (Alphabet) and Facebook, and these are five American companies.

And then there’s something interesting about that. And if you start to ask yourself why that is, and you look at the history, and you look at the US military-industrial complex, you look at the position that the US has held in the world economy especially in the last thirty years - but even before that, right after the war with Bretton Woods - and the role that the US has played in underpinning global capital flows. And you ask yourself, why is Silicon Valley so outsized today? Why is there so much venture capital money coming from the US? What does that mean for the rest of us? That’s pretty important.

So when I talk about abolishing Silicon Valley - it’s about reshaping the economy and fundamentally transforming it so that the current imbalance of power and wealth that we see does not occur anymore. And that’s a huge undertaking. Because the way I see Silicon Valley is that it’s kind of an outgrowth of the rest of the economy, and specifically the trends that have been occurring for the last 40 years in particular. Where you’re seeing this agglomeration of wealth, and you’re seeing technological development being centered around this very small area on the West Coast of the US.

And that’s a problem. That’s not something that we should just accept as natural. That is the result of a bunch of different historical factors and political decisions, and there are open questions around whether that is sustainable or whether that’s the best model going forward.

And as we’ve just talked about just now, one of the major problems of Silicon Valley is the way that so much wealth and energy and time is being focused on really not important problems. You have 10,000 different apps around food delivery and laundry.

Michael: Uber for X.

Wendy: And then the question is, should all these people be working on these things? Or are they working on these problems because of this really flawed incentive structure, which itself needs to be reformed?

Another thing that I’m trying to say when I talk about abolishing Silicon Valley structure is that we shouldn’t really blame individual founders, necessarily. Because it’s not necessarily their fault. People are just doing the rational thing in a world that values trying to raise money from VCS and do silly startups that you can nevertheless raise 50 million for.

Michael: Yeah, they’re just following the incentives.

Wendy: So I think the logical question to ask is, how do we change the incentive structure? How do we create deeper transformations so that the problems that we see today no longer arise, now and in the future?

Abadesi: I’ve just come back from Silicon Valley. I work for ProductHunt and AngelList running HustleCrew workshops on inclusion. But that was really interesting for me because it’s a very homogenous place. The types of people you interact with - the types of people making big decisions - the types of people who hold the greatest power and influence - are still, for the most part, heterosexual white men. If you think of the world at large and the roles that on average heterosexual white men play: they’re facing the lesser amount of social issues, and the lesser amount of oppression and struggle. So what does that mean for the most vulnerable people in the world - the people who desperately need innovation and technology - when the people who hold the power to change things are so far removed from them and don’t really relate?

The historical context of the gig economy

Michael: I think it comes down to network effects. There’s been so much effort that’s gone into building Silicon Valleys in other areas. But I feel like, people are in Silicon Valley because everybody else is in Silicon Valley. All the investors are there, so all the entrepreneurs are. Then all the entrepreneurs are like, all the investors are there. It’s a big problem.

I remember reading: In every city and town, there probably was like a taxi operator who probably a millionaire in the local area. And now Uber’s come in, and wiped that guy out. Okay, let’s not feel sorry for a millionaire. But at least the wealth was local. And now it’s been sucked up by that platform, and that platform is all the way based in Silicon Valley. So I think the problem is almost insurmountable. I hate to sound like a pessimist. Did you have any solutions?

Wendy: I’ll solve it all right now.

I just want to say, I agree with everything that’s been said so far. You can’t hear it on the podcast, but I’ve been nodding the whole time. I love this analysis.

Back to what you’re saying about Uber, for example. I totally agree with that analysis - the way it’s taking money that traditionally would have gone to labour in a very localised way, and bringing it - sucking it up - back to Silicon Valley.

And I think when looking at that sort of problem, you have to recognise the fact that it’s not a unilateral thing. There are good things about these platforms; there are bad things. There are all these different trends and tendencies in different directions.

And one of the things these companies have been really good at is conflating them all, bundling them. So if you look at what Uber has been doing: Uber has done some great things - there are some really cool innovations in the platform that can cause efficiency gains for drivers for consumers, and that’s great.

On the other hand, there are some really terrible things that are bundled into that. There have been a bunch of suicides of Uber drivers in New York recently. And the way some drivers feel like they’re constantly forced to overwork …

Michael: They’re on minimum wage essentially, aren’t they? Let’s keep it real - it’s a minimum wage job.

Wendy: I mean, it depends on the area. I’ve heard stories about Uber in Ghana behaving super rapaciously, using debt to try to get the drivers into debt bondage. These are things that aren’t really talked about, because the tech press doesn’t really care about what’s happening - it’s always presented as this story about innovation.

If you look at what’s actually happening behind the scenes of a lot of these tech companies: they use innovation as this shield to deflect responsibility from taking care of the people that they say they’re giving opportunities to. So Uber, deliveroo: they they don’t like the idea of their drivers or riders being considered workers, because then they’d have to provide them more protection, more benefits. Instead, they’re like, oh we just give them opportunities.

At the same time, they’re giving them opportunities while making a lot of money off their work.

Another way of looking at this, in terms of the historical context: if you look at the the Keynesian golden ages (1945 to the mid-70s), you had a very different social and political landscape. Back then companies followed a completely different paradigm, where it was more expected that they would provide benefits and secure wages.

And I’m not saying we should go back to that - there are good and bad elements of that, for one the fact that women were not really supposed to be working. But at the same time, what we’ve been seeing the last 40 years under this very neoliberal paradigm is that corporations are more and more willing to continue to make money off their workers’ work, while treating them not as workers. While trying to abdicate as much responsibility as possible.

And so in the case of Uber, it’s very clear what they’re doing. They they want to be able to control the people who are working for them - who are actually responsible for the wealth that they’re accumulating - but they don’t want to have to take care of them. They want the state, or …

Abadesi: Or be liable for anything that happens to them.

Wendy: Exactly. What we have to do is, fundamentally, we need to see this as what it is. And that this is not necessarily the only way. That the way tech companies function right now is just the product of a bunch of different economic factors, and that the technology that they so far have been hoarding - that they’ve locked up within these corporate structures - that technology does not have to be deployed the way it is now. It’s deployed in the current way because of the prevailing political landscape. And there are ways of changing that.

This is something where I think you need to innovate on a multiple fronts. You need to innovate on the technical front - you need people who are creating great new technology. But you also need to innovate on the social front - just changing the landscape.

That could mean electoral politics. That could mean political movements, other sorts of campaigning, creating other institutions, whatever. But you have to change more than just the actual technology because that is only deployed in a particular landscape.


Abadesi: Something that was mentioned in that lecture I talked (her name is Vikki Saunders, the founder of SheEO): she mentioned this crazy idea of winner-takes-all. We are obsessed with winner-takes-all. If you try to create another network of vehicles, network of car, network of any kind of transportation network right now - VCs are gonna laugh you out the room. They’re gonna be like, what, you’re gonna take on Uber? They just raised another round valuing them at $72 billion dollars. People are gonna be like, haha, whatever.

Why do we accept that startups - especially in specific categories with low unit economics - can optimize for winner-takes-all, aim for winner-takes-all, whilst at the very same time talking about monopolization and the prevention of monopolies through legislation? Certain mergers between media companies are heavily investigated and then potentially blocked, because once a company has a monopoly on a market share they can control the industry - they can put all that power, in a negative way, onto either their workers or their customers or whatever.

And so I do sometimes wonder about this weird disconnect, and the contradictions. Because where is the monopoly theory for tech? If somehow tech - because it’s growing so quickly and governments are struggling to catch up, and also governments are still reeling from the economic crisis of ten years ago … it’s like tech companies are allowed to have monopolies, and that’s fine. If anything, they’re encouraged by their investors to gain those.

Michael: Most of us don’t take time to read what these people are saying. I read Peter Thiel’s book Zero to One.

Wendy: Me too.

Michael: He talks about, your goal is to create monopolies. If you’re not - if you’re not creating monopolies - it’s not worth your time. You don’t want to be the hundredth restaurant selling Thai food or whatever; you want to be the one search engine.

So we have a system that’s set up to create a monopoly even though monopolies are technically illegal. Once you get to that monopoly stage, you spend all your time saying, we’re not monopolies. So he says that Google will say that they’re a search business. They won’t say that we’re an advertising company. Because when you look at it, they dominate online. Now Facebook has come in, but essentially those two companies have, I don’t know, 80% market share of the online ad market. Which is encroaching on an almost monopolistic territory.

Abadesi: 80 percent of all internet searches = probably more now - occur on Google. How’s that not a monopoly.

Michael: Shout out to Bing.

You know Kara Swisher - she runs a podcast called Recode. She asked Mark Zuckerberg, who are your competitors? And he started stuttering. He actually couldn’t do it.

Bernie Sanders versus Amazon

Michael: There was a rather public spat between Bernie Sanders, the Vermont senator … he’s had a rather public spat with Amazon. Bernie’s been going hard, saying listen, these companies are not paying their staff. We’re subsidizing them with Medicare and all the aforementioned government programs.

That’s not out of the ordinary, he normally does that - but what actually surprised me was that Jeff Bezos came out and made a statement saying, these are all like mistruths, and we’ve invited him into our warehouse to see the standard of condition.

And then Bernie’s come back now to say, listen, I’m gonna introduce legislation to target these companies. Is Bernie on the right track?

Wendy: So if you look at the potential avenues for change: one is maybe on the consumer front. Us as consumers - we could all decide to boycott Amazon. The thing is, because Amazon is so efficient - because of these network effects, and the amount of wealth and power it has in coordinating this huge logistics network - Amazon is going to be the better option for most of us.

I think it’s impractical to insist on people to try to behave ethically when you know it’s not that convenient for everyone. And some people just like it - there aren’t any other options a lot of the time they’re using Amazon.

And so, in that case, the only avenue for change that appears more promising is legislative. Or some sort of political action to ensure that Amazon, this company that has created some wonderful technological innovations, adheres to standards that we as a society have decided upon. In terms of labor law, in terms of whatever it is that we’re unhappy about.

And I do think it’s really important to remember that the labour side of Amazon is a story that’s only come out in the last couple years (that people have started talking about it). I mean, this has been happening for a long time - it’s not like Amazon only just started hiring warehouse workers - it’s just that these stories haven’t really come out.

Amazon has done a really good job of concealing it, and acting as if its wealth appeared out of nowhere - like, we just ship things to everybody using robots. They want people to think that. They don’t want people to think about the dark human costs of what’s actually happening.

As these stories come out, the important thing to remember is that it doesn’t really make a difference if a few of us decide to boycott Amazon because we can - because we have better alternatives. What we should be pushing for is taking advantage of the technological innovations in a way that still respects workers’ basic human rights.

And maybe that means pushing for legislation. Maybe that means encouraging trade union membership among these workers and figuring out how to set up institutions and support different political actions.

Tech jobs not requiring college degrees

Abadesi: A really interesting story that broke last week was Glassdoor, the recruitment site, published a list of 15 different companies that do not require job applicants to have college degrees. It was surprising from a tech angle, because some really well-known tech firms were on that list, including Apple, Google and IBM. We’ve spoken in the past about barriers to entry for building tech careers, and particularly within notable tech firms. So I wanted to get your view on this. How does that make you feel, knowing that these companies have removed that from their job applications? Do you think more companies should do it?

Michael: I definitely I think it’s a small step in the right direction. It’s so ironic because Facebook and Apple were founded by college dropouts, so for them to then create an institution that wouldn’t hire them essentially - it’s kind of crazy. Last episode we talked about the ageism in tech - if you’re a young founder, actually you probably get more respect than a young employee. So there’s certain things where it’s like the person who starts the company probably couldn’t even exist within their structure. It’s kind of interesting

But yes, small step in the right direction. But, many a ways to go. I want to know, what are the requirements of somebody who hasn’t got a college degree to join these companies? I hope it’s not a situation where you have to have done a million side projects and your Github has to be …

Abadesi: I mean, it definitely is.

Michael: And hackathons. There’s a problem with that, because I never used to like hackathons. I was like, why am I working 24 hours here? If you’re a single mother - you don’t have time for that. But what if you had the aptitude to actually work at those companies, and you just never got a shot. But yeah, that’s why I said it’s a small step in the right direction, and not necessarily a panacea for everything.

Abadesi: Something I always talk about in Hustle Crew meetups and in my book is that one of the things that university and schools fail to teach us is, understanding the perspective of the hiring manager. A university degree doesn’t tell you anything more than, you are disciplined enough to complete that degree. It doesn’t tell me that you have evidence to prove you’ll be competent in the role I’m hiring for.

That’s where the examples come in. So I think, in the absence of university degrees, if you are going for a software engineering role or a research scientist role or whatever, you’re gonna have to have a hell of a lot of examples either of your transferable skills or directly relatable work experience to demonstrate to that hiring manager that you’ll be competent in the world.

Michael: But what’s come in in terms of a replacement for college degrees are extortionate boot camps. There’s a lot of people that are now paying like 10 G’s, 20 G’s for these boot camps and that’s even more exclusionary.

This is people trying to make a career transition, and that’s obviously limiting to people that don’t have access to that kind of wealth offhand. There are a few boot camps that are free entry and then you pay a percentage of your income, which is probably a fairer way of doing things, but you know I’m still concerned.

Wendy: One thing to remember is that there is the official list of like requirements that a company will put out, and then there’s the unofficial one. And of course that’ll differ depending on who the hiring managers are, who the interviewers are.

Even though all these companies have to say, by law, that they do not discriminate based on race/gender/immigration status - of course they do. Of course they do. Because the people who are hiring do. And so you have a case where a white guy who doesn’t have a college degree, but who still has a GitHub profile, a Hacker News account or something, is gonna have a much easier time getting a job then a woman of color who doesn’t have a college degree and doesn’t have those things.

So it’s great that these companies are willing to consider those without college degrees. But how much added pressure are they putting, like you’re saying, on other things? Like having a github profile, having gone to hackathons all the time. Not everyone can do that.

A lot of white men especially who are in the tech industry like to say that it’s a level playing field. That it’s a meritocracy. Because anyone can just learn to code; anyone can put side projects on github. No, they can’t, if they have to actually work, and if their day job does not let them do that.

Michael: Or they had dependents, kids, parents to look after.

Wendy: Exactly. The way this discussion is framed, a lot of the time, it’s not considering questions of privilege. It’s not considering how the playing field is not actually level in almost every single case.

Hiring interviews as a site of struggle

Wendy: Going back to the interview thing - I think a really useful way of viewing the interview, especially for software engineering but any company really, is as a site of struggle. It’s like a war - almost like a class war, where it’s you versus the interviewer. You have to figure out how to convince them that you are good at the job and should be hired, and they’re trying to prove to you that you’re not, and get you to lower your salary.

Especially for people who are coding boot camp graduates and who don’t fit the traditional [background] - they have a much harder time, and they have to treat it as such. They have the treat it as such - it’s not that they need to meet the interviewers requirements; they just need to make the interviewer think that they meet the requirements.

I think it’s a mistake to think of companies as these benevolent creatures who will just reward those who work hard. The people who run these corporations, and the people who are making decisions within these corporations - they’re just trying to optimize for their company. They’re trying to get the lowest salaries they can, from the people who aren’t negotiating for better salaries.

That is why a lot of people of color especially tend to get lower starting salaries: because they [often] haven’t been taught to negotiate, and maybe the hiring manager doesn’t like when they [do] negotiate. They’re like, oh, you’re too pushy. And so they end up being like, no, we won’t hire you.

And in that case, if you treat it as a conflict, that’s a much more fruitful way of viewing it. Then you also see that corporations have a habit of dividing the people who they’re considering hiring - potential applicants - based on things like race, based on things like gender. In such a way that if they can get away with paying women less, they will. They will.

And it’s not necessarily this evil masterminded plot. It’s just, this is, structurally, what’s encouraged.

The contractor system

Wendy: We’ve seen, in the last few years, the rise of these contractor workforces. Bloomberg released an article a couple of weeks ago about how at Google, there are actually now more contract workers than full-time employees. This is very recent, and no one’s really talking about this in the Valley, but that includes people who are bus drivers, cafeteria workers, cleaners, but also contract coders.

And if you look at the diversity stats between contract coders and full-time coders, contract coders are much more likely to be women, people of color, people from non-traditional backgrounds.

Abadesi: And they don’t get benefits.

Wendy: They don’t get benefits. They don’t get stock. They don’t even get good health care. And they’re most mostly employed by these shell companies, and because they’re a different company [to Google], Google doesn’t really have responsibility. If these people don’t have a good time, if they don’t like their managers, they can’t complain to Google. They have to complain to their shell company. And the shell company, most the time, is like, we just don’t care.

I’ve talked to people who are contractors who are unhappy with their situation, but they feel like they can’t complain. Because for them, they don’t have a traditional coding background, maybe they’re an underrepresented minority - they feel like this is the best they could get. And that’s something that is actually true maybe, and that’s really sad.

But it doesn’t have to be this way. These companies make so much money - they could afford to pay their workers more. They could afford to pay all their staff more. But instead, they create this system of segregation based on occupation, based on background, because they can. Because it helps them save costs. Whenever they post their quarterly earning reports, it helps when they say, we only have this many full-time employees, because then investors are like, yeah that’s great.

Abadesi: all of the black men and women that I know that work full-time at Google are contractors. Some of them are in their second year, but they’re just being renewed and renewed and renewed, and apparently it’s very difficult to convert from a contractor into an actual full-time employee position.

And it just feels shady. It feels so shady.

Michael: What’s brought about this change? Why they decided to embark on this now? Is it cost-driven?

Abadesi: I think it’s cost saving.

Wendy: Yeah it’s cost-saving. I actually wrote an article about this. It’s been happening for a while now - When I was interning at Google, they did have this contractor system, but it was very small. No one really talked about it, and it wasn’t as bad.

It’s gone huge over the last few years. And now there are 120,000 contractors compared to less than 100,000 full-time employees at Google. Similar stats at other companies.

The company likes to dangle the possibility of converting as a way to get them to work harder. If you just push, work overtime unpaid for the next six months, then maybe we’ll consider converting you.

For a lot of these companies, they don’t have a good conversion process - like not actually having a process in place to make it easy for someone to convert. It’s a huge pain in the ass, and they have to post a new job listing.

They will say, you failed the coding interview, we can’t hire you full time, but we can offer you a position as a contractor. And maybe in six months, we’ll reevaluate and see.

Michael: So it’s like a two-tier track for employment.

Wendy: Yeah and if you consider like the racial bias there …

[omitted some bits at the end, including the YC demo day guessing game and some news roundups from the hosts.]