37 – When to talk and when to keep your mouth shut… we sort of predicted the FTX debacle. Really!

We sort of predicted the FTX and SBF debacle… seriously! How much are CEOs’ political and socio-economic views welcome publicly? How about employees’? How much is too much? In this episode of season 3 of Tech Deciphered, we talk about founders & CEOs activism, employee activism and share our tips on when to talk and when to just… keep your mouth shut. Navigation: Intro (01:34) Section 1: Founders & CEOs activism (02:13) Section 2: M&A changes everything (20:09) Section 3: Employee activism (27:38) Section 4: Bring it all together (39:24) Conclusion (44:57) Our co-hosts: Bertrand Schmitt, Entrepreneur in Residence at Red River West, co-founder of App Annie / Data.ai, business angel, advisor to startups and VC funds, @bschmitt Nuno Goncalves Pedro, Investor, Managing Partner, Founder at Chamaeleon, @ngpedro Our show: Tech DECIPHERED brings you the Entrepreneur and Investor views on Big Tech, VC and Start-up news, opinion pieces and research. We decipher their meaning, and add inside knowledge and context. Being nerds, we also discuss the latest gadgets and pop culture news Subscribe To Our Podcast Intro (01:34) Nuno Goncalves Pedro Welcome to Episode 37 of Tech Deciphered. In this episode, we will address CEO and employee activism. How much is too much? We will touch upon a few CEO-activism events that are recent. We will also talk about how M&A changes everything. Nuno Goncalves Pedro We will then address employee activism, which has become more exacerbated over the last three years. Finally, we'll bring it all together. How much is too much? Should you be in the media all the time? How much should your PR department control of what you say? How much should you listen to your employees? How much, as an employee, should you actually speak out? Section 1: Founders & CEOs activism (02:13) Bertrand Schmitt I think Nuno that's a timely topic and it's something that, for the good or for the worse, has been changing, maybe quite dramatically, if you compare the last decade versus how businesses used to be run before. I guess, of course, it's thanks to change in technologies. You have your cell phone always available. You can talk to people. You can record, you can tweet, you can do video. Bertrand Schmitt I guess step by step, CEOs, employees discovers that they actually could have more of a voice, and there might be less need for a middleman to express your opinion. As a result, you communicate more easily. If you stop communicating publicly, challenges can start to increase. It's a brand-new world out there. Nuno Goncalves Pedro As Spiderman would say, or actually his uncle, "With great power comes great responsibility." Unfortunately, sometimes, people forget the responsibility piece and maybe they tweet at the wrong times of the day, or they say the wrong things without really checking themselves up. Part of it we'll discuss today. Sometimes when you share on social media, obviously, it lacks context, it's misinterpreted, or sometimes it's just plainly wrong, which is also the case. Nuno Goncalves Pedro Shall we start? How much should one have an opinion on specific topics, geopolitical topics that are important socially? How much should a CEO or founder have an opinion on? Maybe we'll talk about a few examples. Bertrand Schmitt I think traditionally, the approach was, if you're in the economic sphere, you are out of the public sphere, you are out of the political sphere, and you are very careful and measured about how you communicate. Usually, you have a big PR department, all focused on supporting you and the message you are supposed to convey, and you certainly don't go off the cuff. Bertrand Schmitt Obviously, things have changed since the past 10 years. It's not easy for a CEO to make that decision to do more, but sometimes you have no choice. I think some interesting examples, a few years back, maybe actually with COVID, we saw some tension about, basically, should you be focused as a company on your mission first at the extent of anything else? Bertrand Schmitt We have seen quite a bit happening in that sphere. Maybe two companies have, in some ways, best showcased to extremes. On one side, you have the Salesforce of the world who is definitely trying to take every topic out there that you can find and trying to push the company itself and its employees to become "good citizens" and to influence the public sphere. We can remember, for instance, how Salesforce was pushing for new taxation scheme in San Francisco, hopefully, to help some people. Nuno Goncalves Pedro Others beyond themselves, because I do think that they got at some point some tax break as a company in SF and that may have rippled to others. Bertrand Schmitt Some would say that it was a clever ploy to actually make it more painful for other companies, especially the competitors to operate in San Francisco. It depends how you position it. It was clearly positioned as a of being a good citizen by Salesforce, but not everyone would agree. Bertrand Schmitt But on the other end of the spectrum, we have a company like Coinbase, where, basically, there was a lot of internal pushback for more discussion internally around what's happening in public policy, what's happening in the US. At some point, the CEOs say, "Oh, this is good and nice." Bertrand Schmitt But ultimately, we are mission-focused company, and this is not our problem. Our problem is, as employees, to focus our efforts and energy on our mission. If we believe our mission is important, that should help you believe you are focused on the right thing, and there is no need to do anything else, at least, during your work hours. Of course, obviously, what you do on your personal time and your personal name is a different story. Bertrand Schmitt But that should be enough. We believe that it's creating too much risk of division of the company to have this constant debate about what should be done from a political perspective. That's not productive or conducing of a good well-run company that wants to be focused on its mission. Bertrand Schmitt I think that, obviously, Coinbase, as well as many companies, have a very important deep mission, and that could be seen as a very fair statement. They think these two companies, Salesforce, Coinbase are really the two extreme of that positioning. Should you be involved in politics, at least internally or should you be much less? Nuno Goncalves Pedro It's interesting because if we go back in time, once upon a time, there was a world where, as you said, there were PR departments, comms directors that were in full control of their CEOs, there were message houses that were followed, media training that was held regularly practice, people talked like really politicians. There was a separation between internal communications and external communications, or internal communications was, by nature, more open, although also fleshed out but more open. Nuno Goncalves Pedro External communications was a lot more focused on what key messages we want to give the market, how will that affect our stock price. Then all of a sudden, all changed. It changed with social media. It changed with the leaking of internal memos. It changed with leaking of town halls that were videotaped and recorded. Nuno Goncalves Pedro All of a sudden, we've gone into a world, where, on the one hand, and we'll talk about employees later on, employees are sharing stuff that maybe they shouldn't be about what's going on in the company; and CEOs, in some ways, are acting in arenas that maybe they should be a bit more thoughtful about. The extreme example obviously is our great friend, Elon Musk. Everything that he does seems to be a meme. Nuno Goncalves Pedro We've talked about him in the past. Amazing one-man marketing machine. I don't think it's one man. He has people working with him, but definitely he's the meme machine. Not mean, but meme machine. Everything got a bit fuzzy. Nuno Goncalves Pedro The distinction between internal and external is not there anymore. People say what's going on, their minds. I share my perspectives on what's happening in the market might not be aligned with my board of directors, might not be aligned with most of my company, actually. It doesn't matter. Nuno Goncalves Pedro We've gone from a world in which people are saying, "You know what? We are a company. We have something we want to do, your logic of mission driven. We are of our own value system, and this is why we abide by the external stuff is the external stuff." Nuno Goncalves Pedro Then we have the other part of the world, where it's just like, everything's open. I'll just do whatever I need to do to get my company out there to manifest my perspectives on what's happening in the market. I need to be very aggressive and active about it." Nuno Goncalves Pedro In some ways, actually market Salesforce is a little bit more to the middle than to the extreme. Maybe Elon is the extreme example here. Marc is very thoughtful on how Salesforce will show up. Obviously, he has his principles. There's a value system that they abide by. Nuno Goncalves Pedro Maybe Elon is at the other extreme, which is like, "I have perspectives on everything. Tesla is not the only company I'm running. This is my perspective right now." Nuno Goncalves Pedro I think that's a little bit too much. Honestly, at that point in time, you have people that are a little bit bigger than life, in some ways. I'm not saying that what Elon is doing is not creating value for his companies. It's actually, quite the opposite, probably he's creating a lot of value for his companies. Nuno Goncalves Pedro But it's incredibly risky. You're going to unavoidably step on people's toes that you shouldn't. You're going to be operating in an arena that you're probably not well-equipped to participate. Nuno Goncalves Pedro I think, for me, that's the biggest objection I have is when I he