The San Francisco Fallacy — Book review

I don’t think I could relate more with a book than “The San Francisco Fallacy,” a book by Ben Siegel which takes a look at why startups fail. I found out about the book during a recent Noah Kagan Presents podcast.

There are 10 reasons outlined in the book, and each of the stories are short, funny and show the point of why failure happens.

The book is so to-the-point, Siegel writes out what the San Francisco Fallacy in the first page! If you’re waiting for the cliffhanger on what it is, you don’t have to wait long. Obviously, you’ll want to read the rest of the book, it’s that good.

Having run several ventures is why I could relate to this because I kept saying, “yep, that’s me” a lot.

I will go over all 10 fallacies and show how they relate to what I’ve been through.

Fallacy One: The Tech Fallacy. The belief that your technology is all-important.

My ‘technology’ was writing. When I was doing Get Your Tournament, I believed my writing would carry the day when it was increasingly clear that visual and live content were grabbing people better and faster. I wanted people to care about my writing and nobody cared. I didn’t shift until it was too late, when I was forced to.

When the ‘technology’ changed to streaming, I believed it was the content that would rule the day when all people wanted was a damn crispy feed that I couldn’t provide. Now, today the crispy feed is by default and content is key. Bad decisions on my part.

Since moving to SoCal, I’ve been in meetings and talked to people who are content their tech is the one thing that will make them a unicorn. And I kept saying, “No, your technology is nothing new, plus knowing firsthand this is a recipe for disaster, I should leave.”

Fallacy Two: The Democracy Fallacy. The belief that good teams—and therefore startup companies—should share leadership and equity.

Two mistakes in this one. With one, I was on equal footing with everyone, and then I got ran over. By the time I was able to figure out that I should not get run over in my own venture, it was too late.

In another venture, I was the leader, but I was too scared to delegate out of fear. And yep, the tide shifted in equity again.

Here’s the key part about this. In both of these different ventures, I asked people how I should handle both situations, and I was told repeatedly to get people on my side. Nobody said to strike down and say “my shit, my rules” or something to that effect. Taking the former was “I’m friendly” decision but also the worst decision.

Fallacy Three: The Investment Fallacy. The belief that securing investment is a mark of achievement.

I never received any funding but I’m sure if it was any of my ventures in the past I would have fucked it up.

This is coming to light because a lot of companies that have received funding have shut down this year.

Fallacy Four: The “Failure Is Not an Option” Fallacy. The idea that success comes to those who refuse to consider failure.

I was terrible at this with my previous ventures. It’s like, I poured so many hours, days and years and you’re telling me it’s ok to give up when other people are making it?

But had I accepted failure earlier, I could have saved my hair, lowered my stress levels and perhaps tried some other ventures I was curious about.

Fallacy Five: The Expert Fallacy. The belief that the experts know best.

When I was stuck, I turned to experts I knew to help me understand what the next move was. The problem was these experts weren’t in the field of games, which most of the time was what I needed help with. Square peg, meet round hole.

Then when it came to be about games, the experts were wrong almost all the time! Damn. Just like it was outlined in the book. One. Hundred. Percent.

Fallacy Six: The Idea Fallacy. The idea that inspiration counts more than perspiration.

Of all the fallacies, I don’t think I fell victim to this. Get Your Tournament, the Amiibo Trainer Podcast, the books, the blogs, the databases (if I want to count that?). If I had an idea I tried it out for at least a little bit to see how far it would go. I put in the work, so I would say I get the pass here.

Fallacy Seven: The Scale Fallacy. The belief that the only thing that counts in the tech startup world is a product that can scale.

I’ve read Paul Graham’s do things that don’t scale concept. When Get Your Tournament started, it was only focused on California events and players. The idea to ‘scale’ was to have a site for every state, which was dumb because the world was being connected tighter then ever especially in games. So I said fuck it, but in doing that, I wasn’t ready, and it was a mess after that.

When I ran my first ebay business as a young one, I only wanted to sell Giants cards and then expand to A’s and then to all of the teams even though the Giants are the one team I actually like. I should have just stayed with the Giants.

Fallacy Eight: The L’Oréal Fallacy. The belief that you shouldn’t accept anything less than you’re “worth”.

There were opportunities to take sponsorships or merge with companies and call it a day. Only once did I say yes, which was when I went with Gameriot, which didn’t last long. But in all other situations, I held out for a bigger payday because no way am I taking your $100 a week sponsorship. LOL whoops

Fallacy Nine: The Quality Fallacy. The idea that quality is a higher moral goal; that you should focus on quality first.

Big victim of this, especially with the Melee videos and the commentary blogs. I wanted flash, bangs, wows and all that when the community just wanted the damn videos posted on this new video site called YouTube. I wanted everything to be perfect the first time before it was presented. This hurt me from day 1 and even as I brought people along to help me because they also had the same feelings.

I also put the website change in this grouping.

Fallacy Ten: The Passion Fallacy. The belief that passion is the key ingredient behind an idea and a product.

Your honor I am guilty as charged. I believed my passion was going to carry me to success in the early ventures. When it was running events, I did 99 percent of the work myself. The other 1 percent I had my hand hovering over the work. I was everywhere. Get Your Tournament I went to as many events as possible. I wanted people to see the drive. The blogs and other websites it was about bleeding out the passion on every page. Goodness as I’m typing this I am laughing because it is so bad.

= = =

There’s an extra point in this. On the podcast, Siegel was asked whether people should start their own business, and he said no.

Almost every entrepreneur who gets on a podcast says “You must start a business!” “Be an entrepreneur!” “Quit your job and run a lemonade stand!” “Be your own boss by running your own company!”

Siegel’s idea: is it about having the status of CEO, or is it about being successful? In his case, find a company that’s already in the works but flagging, take it over and attempt to turn it around.

Had I known that 10 or even 20 years ago, I wouldn’t have started quite a few ventures. Instead, I would have found similar ventures, asked to take over, and then see whether I could boost them up. This is something I would deeply think about today if I wanted to start a new venture.