Monthly Archives: March 2012

Why I will Vote for Obama in November

Posted on March 14, 2012 12:52 pm | 19 Comments

I am going to vote for Barack Obama this November, but not for the reasons most people will. I didn’t last time. I didn’t vote for McCain either.

I believe that Barack Obama has been a bad President. He has shown little to no leadership, lack of backbone, a poor grasp of economics and has been in constant reelection mode since his inauguration. He’s made a bit of progress, but hasn’t proposed real solutions to any of the big issues. He’s spent huge amounts of money and continued to run up debt. And before you say it’s the evil Republicans’ fault, Obama had a filibuster proof majority in both houses for a year and a half and still couldn’t get things done.

During Obama’s term, he passed health care reform, but only went half way. Instead of leading, he outsourced all of the hard work to the very unpopular Harry Reid and Nancy Pelosi. Whether you agree with Medicare for all or not, Obama could have passed it if he wanted to. He also could have tried to push for fixing the root of the problem: that healthcare is based on use, rather than outcomes. Instead we got Obamacare.

Guantanamo Bay is still open. Even worse, Obama has presided over some of the largest erosions in our civil liberties in recent history, many of which are unconstitutional. He signed a law that allows US citizens to be detained indefinitely in Guantanamo without a warrant, a trial or due process. He’s authorized the assassination of US citizens who “support terrorism.” He intervened in Libya and is thinking about it in Syria.

His TSA has introduced naked body scanners, pat downs of little kids and the elderly and is thinking about adding random TSA checkpoints complete with scans for cars on the highway! The Orwellian “if you see something say something” is coming out of Obama’s government. To not appear weak on terrorism, Obama has allowed all of this to happen under his watch. If a Republican had been in office, the left would be HOWLING, but since Obama is a compatriot, the criticism in muted.

Obama’s justice department and SEC have let Wall Street do as they please, presiding over huge bailouts while leaving mainstreet to pick up the pieces on its own. His administration has kicked the can down the road in just about every aspect of government, preferring to do the safe, hopefully crowd pleasing move rather than actually lead. Afghanistan is still raging and seems to be getting worse by the day. Our spending is out of control and our debt situation will be like Greece or Spain if interest rates ever rise. To me, his biggest success is that he’s gotten us out of Iraq.

So all of that said, why am I going to vote for Obama in November? Because since about 2008, the Republicans have been an unmitigated disaster. They’ve pushed out the moderates and become the party of fear. They’ve become anti-intellectual and incredibly social conservative. Instead of a primary, they’re hosting an old school Christian religious revival, looking for other people to blame. Illegal immigrants, Barack Obama, Islam, gays, college students…”others.” This is a very very dangerous path to go down.

That Santorum, a guy who lost his home state by 18% points a few years ago, and Gingrich, who was thrown out of the House of Representatives for ethics violations, are mainstream and winning states in primaries is shocking. Republicans are selling old policies, fear and religion. Many have much more in common with the Islamist fundamentalists than they would ever like to believe. They’ve started a war on contraception, gay rights and morality. We have candidates that say with a straight face that the devil is attacking the US and that we shouldn’t have a separation of church and state. We have states that are requiring candidates to sign anti-premarital sex pledges.

Unless something crazy happens, Romney will face off again Obama for the Presidency. He is more moderate than the other Republican candidates, but he’s decided to practice the anti intellectual, pro Christian, politics of fear that the rest of the candidates are using to try to win the Republican nomination. I don’t think Romney has much to offer as a President. I admire the work he did with the Salt Lake City Olympics, but I don’t think he will actually make the big changes we need to save the US. He’s not a transformational leader.

He’ll make some changes, while trying to get reelected in four more years. We don’t need that. We need a leader, someone comfortable saying that we need big changes and actually implementing them. Someone who’s willing to go after vested interests on both sides and tackle our long term problems.

Romney won’t do it. He’s going to try to get reelected. And I have no idea what he really stands for. I had hope for Obama, but instead he focused on getting reelected and staying popular. Maybe as a lame duck he will find his convictions?

Probably not. Obama will likely stay on the same path. But there’s a 10% chance he says “fuck it, I’m going to do it my way” and actually lead. We need motivation, inspiration, an “ask not what your country can do for you” moment. Someone who will not be beholden to vested interests to take on the military industrial-Wall street complex, plus social security, health care and our national debt.

I’m fiscally conservative and socially liberal. I don’t agree with Obama economically on the vast majority of issues. But I’m going to vote for him because Romney and the Republicans are going down a road that I find despicable and don’t think they are the transformational leaders we need. I’d rather take the small chance that Obama can be a game changer, because I don’t think he can really do much worse of a job. We’re already beyond the point of no return for spending/reform, so any extra spending Obama does wont really hurt much, it’ll just make our day of reckoning a bit sooner. His lame duck status might actually help him lead because he won’t have to worry about reelection. Romney will.

In short, if Obama wins, he might do what he said he would in his first campaign. If he doesn’t he can’t hurt much more than he has. And it clears the way for potentially transformative Republican candidates to run in four years. People like Mitch Daniels and Chris Christie or other potentially game changing figures. If Romney wins, we’ll be stuck with him as the Republican candidate for the next 8 years. We need a huge change and Obama is our best choice. For now.

What do you think?

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Posted in Political Science & Economics

Tagged gingrich, holding nose vote for obama, obama, romney, santorum, transformational leader

#FixYoungAmerica

Posted on March 7, 2012 4:05 pm | 3 Comments

Since the Great Recession started, young people have weathered a disproportionate amount of the shocks that have resonated through the economy. Four years later, youth employment is at a 60 year low and student loan debt, which you can’t even get rid of via bankruptcy, is almost $1T. That’s trillion. With 12 zeros. Even recent college grads with decent degrees are having trouble finding jobs. Our government is broken, refusing to deal with real problems head on, preferring to engage in partisan bickering and gotcha politics.

We are going through the biggest changes since the industrial revolution. Technology is changing fast, replacing jobs with computer programs and robots that always show up for work and never get sick. In the late 1990s and early 2000s, we lost our manufacturing jobs. In 2008-2010, we lost many middle management white collar jobs. These jobs aren’t coming back. Our new industries only employ a fraction of the people our old giant companies did. Instead of looking for solutions, our institutions are failing us.

It begs the question: how safe is your job? Do you have a skill? Are you willing to work harder than other people? Do you take criticism and work under pressure? Are you better at something that just about everyone else? To succeed in our new economy you either have to create something on your own, have skills that help those who are creating succeed or be willing to work incredibly hard. You need to be willing to learn every day. You have to compete with the rest of the world!

From government to Wall Street, our instutions are failing us. They’re busy talking about how bad it is or recycling old ideas that aren’t going to work anymore. The loudest voices are not proposing real solutions. They are stuck in the past. So how do we help fix the problem?

Enter #FixYoungAmerica and The Young Entrepreneur Council. ”From the Arab Spring to the Tea Party, from Occupy Wall Street to the SOPA and PIPA protests, we’ve seen the power of what like-minded individuals can achieve. #FixYoungAmerica is about starting a much-needed conversation in America and implementing a REAL plan of action,” writes Gerber. A combination of entrepreneurship, education, government policy and hard work will make things better. #FixYoungAmerica is designed to start the conversation and force it into the halls of government by getting our ideas into the hands of every member of Congress. It’s a movement that needs to happen.

I’ve been a big supporter and member of Scott Gerber and Ryan Paugh’s YEC movement from the beginning. I’ve seen the good work that YEC has accomplished so far and know this campaign can really make a difference. But #FixYoungAmerica needs your help. Check out the #FixYoungAmerica website and add your voice to the conversation. We need it.

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Posted in Entrepreneurship, Political Science & Economics

Tagged #fixyoungamerica, theyec, young entrepreneur council

A Funny Story about an Acquisition that Didn’t Happen

Posted on March 2, 2012 10:37 am | 43 Comments

In startups, as in life, you cannot have regrets. Here’s a story about an acquisition offer that I rejected in 2006 that would have been worth millions today.

It was winter 2005. I was a 20 year old just starting my second semester of my sophomore year at the University of Wisconsin. I’d just finished my first six months running ExchangeHut, a tickets and textbooks trading platform on campus. In six months, we’d earned over $20,000 in revenue, much of it profit, and grown to over 7,000 users. My cofounder and I had dreams of expanding. If we could continue to grow Wisconsin and expand to other campuses while replicating our success, we’d make a pile of money! We were having a ton of fun, learning new skills and meeting lots of interesting people.

One day, I got an email from a company called Cheggpost. They said they wanted to chat because they had a similar service and we might be able to work together. I checked it out and it looked like a college campus specific craigslist with users at Iowa State. I was interested and so a few days later, we got on the phone.

I met Aayush Phumbhra who introduced himself as Cheggpost’s founder. He immediately informed me that they’d just gotten funding, were coming into the Madison market with a huge budget and that we had two choices: join them or get crushed.

I was taken aback. Who was this guy to tell me he was going to crush me? He didn’t know anything about my business, it was all bluster. I told him I didn’t agree, but I’d listen to what he had to say. I didn’t have a good feeling about Aayush and Chegg, but decided to keep talking.

Over the next few weeks, we chatted a few more times. The first time I called him, instead of a ring, I got “please enjoy the music while we connect your call” and a rap song that went something like “I’m gonna fuck that bitch, fuck that ho.” I’m a pretty big rap fan, but was more than a bit shocked to hear it when trying to call the CEO of a company! My initial uneasiness about dealing with Chegg continued to grow.

Still, I agreed to meet. Aayush told me he didnt have much time, he could spare 15 minutes on a Wednesday night if we could meet just off the highway, as he was driving between Chicago and Minneapolis. My business partner and I arrived a bit early and were surrounded by the late night Taco Bell crowd, pretty much drunks looking for fourth meal. The Taco Bell next to the highway wasn’t exactly what I had in mind when I was thinking about doing business meetings, but I gave him the benefit of the doubt. It was late, he was hungry and in a hurry. We waited for awhile, but he didn’t show. I called his cell, got the rap ring back tone, and finally an answer. He was running late, but would be there soon.

Aayush arrived about a bit later in new looking sports car, wearing really flashy clothes. The three of us really stood out in the late night Taco Bell crowd, but whatever, you sometimes have to do interesting things as an entrepreneur. I still gave him the benefit of the doubt and decided to hear him out. He started out by telling us his plans for Chegg. They had raised money from a family friend who had made money from being an early employee in a large Silicon Valley tech company and planned to use it to take over the us college landscape by expanding Cheggpost. He told me that they had so much cash and a better team that they would crush anyone who didn’t agree to work with them.

He sold us the dream: sell ExchangeHut to Cheggpost for a tiny amount of cash and lots of stock, join the team, move to the Valley and live the dream. He’d pay us 100k+ salaries, give us hot cars and introduce us to the best women. It was a slick sales pitch, but my bullshit detector was running full steam. He reminded me of the multilevel marketing guys who prey on the new freshman every year. We listened for 45 minutes, asked lots of questions and then decided to call it a night.

As soon as we left, my business partner and I started laughing. We couldn’t take him seriously. It just seemed so fake, like he was selling smoke. My business partner and I decided we couldn’t cast our lot with Chegg, declined their offer and got ready for the next year on campus.

Fast forward to summer 2006. Aayush called me again and said he was going to give us one last chance to partner before they were going to move full force into the Wisconsin campus. He made a better offer, this time with a bit more cash and more stock. But he was still selling the dream of moving to the valley, fast cars, hot, easy girls. It reeked of fakeness, but I still really thought about it. He’s a great salesman.

I decided to do some real due diligence before moving any farther. I wasn’t sure if it was just my feeling or if others would get the same general bad vibe coming from Aayush that I did. I tracked down the original guys from Iowa State who sold Cheggpost to Aayush and Osman. They confirmed many of the bad feelings and helped me decide the not work with them. I also asked my Mom, an attorney and experienced BS detector, to listen in on one of our long business calls to get her opinion. She agreed, he sounded like an infomercial huckster or an MLM scammer.

Just before the school year started again, we decided to compete. Aayush told us he was going to crush us. After one semester, we’d crushed Cheggpost at Wisconsin. They spent thousands of dollars and didn’t get any users, while we continued to grow. We had revenues of over $30,000, most of it profit. After the school year, Chegg exited the Wisconsin market. Two years later, we sold ExchangeHut to an ad network we’d worked with that was itself getting acquired.

Chegg didn’t cross my mind for two year, until one day in 2009 I was reading USA Today and read that Chegg had pivoted and raised a nice sized round and was getting noticed by Kliener Perkins, among others. I couldn’t believe it. How could the guys I had gotten to know be winning over valley bigwigs with the same tactics? Besides pivoting business models, I figured they must have learned and became more professional. Over the next two years, I watched as Aayush, Osman and their team turned Chegg into a juggernaut. They raised over $225m and have revenues in the hundreds of millions. There are rumors that they will file for IPO sometime soon at a $5 billion dollar valuation. They are acquiring companies left and right.

It’s amazing what Aayush and team have been able to accomplish in the past five years. I look back and see the opportunity to have been one of the first, if not the first, acquisition by Chegg just before they pivoted their business model and see what could have been. Our stock likely would be worth upwards of $25m and probably more.

The funny thing is, if I had to make the same decision today, with the exact same information, I would elect to keep working on my own instead of working with Chegg. They’ve been an incredible success, but the sales pitch didn’t work for us. Aayush and Osman have moved on and become incredibly professional, building an incredible business. But its fun to look back and see where it all started. Congrats to the Chegg team, keep killing it!