Ayn Rand and Silicon Valley

October 25, 2012 · 5 min read

Travis Kalanick's recent talks at YC Startup School and elsewhere, in which he often decries the interference of protectionist regulations that block competition in the taxi business, have some people talking about how Kalanick has been influenced by Ayn Rand and Objectivism.

Rand resonates, to a greater or lesser degree, for many in the tech startup world. Fred Wilson recommends Atlas Shrugged, and Brad Feld is a fan as well. Several less prominent investors and entrepreneurs, such as myself, are Objectivists.

The reason is that Objectivism and the Silicon Valley ethos have a lot in common.

Maker mentality

The Valley's ideal is a productive maker who is driven by a creative vision, something he passionately believes in and wants to make real. This is exactly the essence of some of Rand's best-known heroes, such as architect Howard Roark from The Fountainhead:

Austin Heller: "What in hell are you really made of, Howard? After all, it's only a building. It's not the combination of holy sacrament, Indian torture and sexual ecstasy that you seem to make of it."

Howard Roark: "Isn't it?"

The maker works long and hard over many years, triumphing over obstacles, setbacks, and naysayers—like Hank Rearden, the industrialist from Atlas Shrugged, did to create a new metal. Rand describes:

the nights spent at scorching ovens in the research laboratory of the mills—

—the nights spent in the workshop of his home, over sheets of paper which he filled with formulas, then tore up in angry failure—

—the days when the young scientists of the small staff he had chosen to assist him waited for instructions like soldiers ready for a hopeless battle, having exhausted their ingenuity, still willing, but silent, with the unspoken sentence hanging in the air: "Mr. Rearden, it can't be done—"

—the meals, interrupted and abandoned at the sudden flash of a new thought, a thought to be pursued at once, to be tried, to be tested, to be worked on for months, and to be discarded as another failure—

—the moments snatched from conferences, from contracts, from the duties of running the best steel mills in the country, snatched almost guiltily, as for a secret love—

—the one thought held immovably across a span of ten years, under everything he did and everything he saw, the thought held in his mind when he looked at the buildings of a city, at the track of a railroad, at the light in the windows of a distant farmhouse, at the knife in the hands of a beautiful woman cutting a piece of fruit at a banquet, the thought of a metal alloy that would do more than steel had ever done, a metal that would be to steel what steel had been to iron—

—the acts of self-racking when he discarded a hope or a sample, not permitting himself to know that he was tired, not giving himself time to feel, driving himself through the wringing torture of: "not good enough... still not good enough..." and going on with no motor save the conviction that it could be done—

—then the day when it was done and its result was called Rearden Metal.

Going against the consensus

The virtue of independence—thinking for yourself—is the theme of The Fountainhead and a cardinal virtue of the Objectivist ethics. It's also a part of the maker mentality: innovation comes from following one's own judgment, not the herd. Fred Wilson says social proof is dangerous, while Brad Feld exhorts investors to make their own decisions.

In contrast to the makers, mere copiers like the Samwer brothers are looked down upon. In the Valley, you get more respect if you try an original idea and fail than if you copy an idea and succeed.

Rand's basic conception of independence is having one's primary orientation to reality, to the facts; not to other people and their ideas. To succeed in entrepreneurship and especially in investing, though, you need to go farther. You need to be not only be right, but non-consensus right. I first heard that idea and that phrase from Mike Maples, but I heard a variant of it from Peter Thiel in his recent Stanford lectures on entrepreneurship, and from Reid Hoffman at a Pando Monthly event.

Creating more value than you capture

This one may come as a surprise to those who only know that Rand advocated "selfishness". But Rand's basic guideline for human relationships was what she called the trader principle: deal with others by trading value for value, by mutual consent to mutual advantage, never seeking nor granting the unearned, never sacrificing yourself to others nor others to yourself. In other words, seek only win-win relationships.

The maxim to "create more value than you capture" is a corollary. If you try to capture more than you create, you're seeking the unearned. When you create more than you capture, you're making sure that those you trade with are getting something out of the deal, too.

Playing the long game

Creating more value than you capture is part of a larger theme in the Valley: playing the long game.

To play the long game means to remember that the relationships and reputation you build need to last you a lifetime. Thus, we look down on those who screw over co-founders, employees, or investors; we admire those who honestly and bluntly admit mistakes. Reid Hoffman extols the value of "alliances built on trust and integrity", saying that in the long run they are the most valuable.

The long-term mentality is also a key part of Objectivism. Rand's ethics is based on the idea that to thrive and flourish, one must think and act long-range. The grubbing, short-term mentality is ultimately self-destructive. This is why a philosophy that advocates self-interest also demands ruthless honesty, integrity, and justice. Moral principles, Rand held, were the only way to grasp the long-range consequences of one's actions and to make the right choices in the scope of one's entire life.

Unlimited ambition

What I love most about Silicon Valley is the intense ambition that is a part of the culture—the drive to do great things, to achieve the extraordinary, to change the world. Our heroes are not martyrs; they are successful, happy, and often rich.

As Rand wrote in Atlas Shrugged, in a passage that could inspire any entrepreneur in his darkest days:

Do not lose your knowledge that man's proper estate is an upright posture, an intransigent mind and a step that travels unlimited roads. Do not let your fire go out, spark by irreplaceable spark, in the hopeless swamps of the approximate, the not-quite, the not-yet, the not-at-all. Do not let the hero in your soul perish, in lonely frustration for the life you deserved, but have never been able to reach. Check your road and the nature of your battle. The world you desired can be won, it exists, it is real, it is possible, it's yours.

That deep, abiding optimism, that sense of the grandeur of life and the world, is part of what drew me to Objectivism and what resonates with me so deeply. I think it's what resonates with others in the startup community, too.