November 2000, Volume 69, Number 1

Hot Draft Pick FOUNDING THE "Dead Sea Fishing Club" and helping a couple of nonprofits stagger back from the brink of bankruptcy were just a couple of the achievements Industry Standard cited when it named Dan Rapaport, MBA '00, as one of the five graduates on its annual MBA draft list of desirable job seekers. An economics major as an undergrad, Rapaport spent four years at Cornerstone Research before coming to the Business School. Rapaport ultimately took a job with Draper, Fisher, Jurvetson. Venture Capital's New Look IN THE FIRST QUARTER OF 2000, venture capital firms spent $22.7 billion, compared to $6.2 billion for the same period in 1999. So, observes Industry Standard, it shouldn't be too surprising that the VC community is becoming more specialized as firms move beyond their traditional financing role. John Thornton, MBA '91, a general partner at Austin Ventures in Texas, described how as his firm grew it created a new $60 million accelerator, AV Labs, to specialize in early-stage investing. Expansions like this mean VC firms are also changing the kinds of people they hire, with younger people and more women and minorities joining their ranks. At the Business School, for example, 11 percent of the classes of 1999 and 2000 went into venture capital and equity investing. Thornton told the magazine he meets new MBAs today who know more about venture capital than he did after three years in the business. The Comforts of Home AS DIRECTOR OF WORKPLACE effectiveness, Ann Bamesberger, MBA '83, has introduced some profound changes at Sun Microsystems, says Fortune. Bamesberger asked chip designers what they'd like in their new offices being built in Burlington, Mass. Her 10-person staff, made up of social anthropologists, designers, and IT experts, found out that the designers spent about 30 percent of their time interacting with coworkers and preferred to spend the rest of their time working from home. Bamesberger herself says she works mainly from her car. The Basics Stick PEDDLING MILK AND EGGS door-to-door in upstate New York is a far cry from being dean of the Business School or a leader in international banking. But helping his grandfather run a small business taught him a few basics that he uses today, says Dean Robert Joss. "A lot of people think the new economy has new truths. It doesn't. The old truths are still there—the new economy just has new risks and new opportunities," Joss told Fast Company. Joss and Frank Quattrone, MBA '81, were among a dozen people profiled in a store exploring the first jobs held by today's business leaders. Quattrone cited lessons learned from a personable coworker in his first job at Morgan Stanley. "If you relate to clients as people, and if you show them that you're vulnerable and human too, they're going to want to work with you," said Quattrone, now managing director of Credit Suisse First Boston Technology Group. Capture the Flag and Other Games SILICON VALLEY is not all money, flex time, bring your parrot to work, and executives with quirky titles. Some of it is as dark and murky as 15th-century palace coups, says Business Week. It may involve rummaging through the garbage to find discarded trade secrets or raiding a competitor's staff to pick up some inside information, along with some top talent. Say some observers, the rules of a polite society don't apply. "Silicon Valley culture is a male adolescent culture with all that implies," Business School organizational behavior professor Jeffrey Pfeffer told the magazine. "It's all about excess." Young Analysts Play It Safe YOUNG STOCK ANALYSTS with brokerage firms tend to stick close to the consensus view, but apparently grow bolder as they grow older, according to a study in the RAND Journal of Economics by assistant professor of finance Harrison Hong and two colleagues. Business Week reported that the researchers don't agree with the thesis that young analysts are simply still learning their jobs. Instead, they argue, young analysts are far more likely to be fired for bold but inaccurate forecasts than are their older colleagues and so face greater risks to their careers. The Attacker Advantage THE MUCH-LAUDED first-mover advantage may not be an advantage, says Red Herring. First movers get the glory but the second attacker usually benefits from the leader's mistakes. David Montgomery, Business School professor emeritus, told the magazine second movers don't always have to attack. They may be smarter to "find a protected niche where you can make money for a while" and wait for the leader's mistakes to become obvious. Or they may go after the leader with a price war. "The biggest guy in the market has the most to lose in a price war," said Montgomery. "If he goes across the board on a price war, then he's cutting his margin on a really wide swath of income." Book Report TWO BOOKS BY alumni are on Industry Standard's list of the 50 business titles it thinks will be hot this year: The 10-Second Internet Manager: Survive,Thrive and Drive Your Company in the Information Age (Crown Business, 2000) by Mark Breier, MBA '85; and Unleashing the Ideavirus (Do You Zoom, 2000) by Seth Godin, MBA '84. John Chang offered Helen Loh flexibility in return for her long hours at his company. Photograph by Anne Knudsen. Get a (Little More) Life PRACTITIONERS IN the new economy are finally noticing a basic truth long practiced by their older peers in human resource management. Giving your employees lots of stock options and buying junk food for them doesn't compensate for the fact that they work 20 hours a day and don't have personal lives. "I can't promise people that they'll only have to work 40 hours a week here, but at least I can give them flexibility so they can balance their lives," John Chang, MBA '91 and CEO of the online events-services firm seeUthere.com, told Fast Company. He cited the case of Helen Loh, MBA '90 and the firm's VP of marketing, who made an agreement with Chang when she was hired that she could leave at 2:30 several days a week to pick up her child from school. The firm also has people who work at home during rush hour and then come to the office after the freeways have cleared. Web Consolidation in China A YEAR AFTER Joseph Chen, MBA '99, launched the Internet portal ChinaRen with two Stanford engineering friends, competitor Sohu.com announced it was acquiring the portal with 2.8 million users. The consolidated portal would have 7.3 million users, leapfrogging some of its competitors in the world's fastest-growing Internet market, Dow Jones News Service reported. Portals in China cannot count on the same revenue streams as U.S. counterparts, Business Week reported, because China has fewer online advertisers. Also, it's difficult to build a customer base online, since few Chinese have credit cards. Livin' La Dolce Vita LIVING IN ITALY for a year took more adjusting than simply learning a second language, Beth Sawi, MBA '81, told the San Francisco Chronicle. Healthy as it is, the Italian economy doesn't operate on an American schedule. Stores close on Sunday, shops lock up at noon for lunch, and workers routinely take a month's vacation. As the chief administrative officer and executive vice president for Charles Schwab & Co., Sawi has struggled with balancing her personal and corporate lives. So she took a year off, went with her family to Italy, and spent some time thinking. The result has been some changes Sawi has shaped in Schwab's corporate culture-and a new book: Coming Up for Air: How to Build a Balanced Life in a Workaholic World (Hyperion, 2000). More than You Ever Wanted to Know IF THERE'S ANY DOUBT about the influence of Silicon Valley these days, just consider the obscure facts about personal lives of industry leaders that are finding their way into print. Industry Standard described the Ferrari owned by Kevin Fong, MBA '82, and the Porsche 911 owned by John Walecka, MBA '88. Wired asked Josh Silverman, MBA '97 and CEO of the online firm Evite, for his favorite Web bookmarks. Silverman listed Citysearch.com for entertainment reviews, OpenTable.com for dinner reservations, Ofoto. com for film processing, Epinions.com for product reviews, and eFrenzy.com for service providers ranging from maids to party clowns. The San Jose Mercury News then brought us the latest about the Top Dogs: John Hummer, MBA '80, and his mixed-breed companion, Chief, made the top of the list (Hummer says Chief listens to entrepreneurs' pitches and expresses his opinions). Heidi Roizen, MBA '83, has two mixed breed dogs, Rocket and Ramjet, who are social animals; Vinod Khosla, MBA '80, has sheepdogs; and Brook Byers, MBA '70, has a golden retriever with a reputation. Scott McNealy, MBA '80, admitted to the paper that his Swiss mountain dog, Network, no longer lives with him. He's a Bear When He Shops THEY ARE THE ALL-STARS OF Wall Street, says Fortune—a list of 15 men and women named by the magazine as the All-Star Analysts for 2000. Topping the list alphabetically is Gary Balter, MBA '84, who cruises the aisles of places like Costco and Target to bolster his view of the retail industry for Donaldson, Lufkin & Jenrette. A few years ago, Balter stood in line and waited in vain at the customer service booth of a Toys 'R' Us store in Connecticut. After the experience, he started looking into the company's performance indicators and didn't like what he saw. Balter turned bearish. The market soon agreed. What stores currently impress him? Balter told the magazine he sees good things in the future for Target and Best Buy.

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