Preferred Style: Don’t Flaunt It in Silicon Valley

By SOMINI SENGUPTA

Published: May 17, 2012

 

MENLO PARK, Calif. — Wealth is here if you know where to find it.

 

 

Fabulous home theaters are tucked into the basements of plain suburban houses. The hand-painted Italian bicycles that flash across Silicon Valley on Saturday mornings have become the new Ferrari — and only the cognoscenti could imagine that they cost more than $20,000.

Even at Facebook, ground zero for the nouveau tech riche, peer pressure dictates that consumption be kept on the down low.

“The message here is, ‘Keep shipping product,’ ” said a Facebook executive who requested anonymity while discussing internal matters. “If someone buys a fancy car and posts a picture of it, they get ridiculed and berated.”

The company disclosed on Thursday that on the eve of its stock market debut it was inviting employees to a hackathon, or marathon programming session, bringing new meaning to the term overnight millionaire. The event is more likely to be fueled by Red Bull than Dom Pérignon.

Make no mistake. In this, Silicon Valley’s gilded age, money is chasing money. Lucrative salaries and stock options are dangled to recruit or hold onto engineers. The shares of established companies like Apple have soared. And Facebook itself has turned to Wall Street for a vast infusion of fresh funds.

But here in one of the richest corners of the country, the tech elite display an ambivalent, sometimes contradictory approach to wealth. Money, as one scholar of the Valley described it, is treated as a measuring stick, gauging the power of the companies that entrepreneurs have built, rather than a thing to display.

“They use it as a way of keeping score — how disruptive can you be in reordering the market,” said Ted Zoller, a senior fellow at the Ewing Marion Kauffman Foundation and a scholar of entrepreneurship.

Money, of course, still matters deeply to this crowd. “It is a means to do more, to make more money and ultimately build more,” Mr. Zoller said.

The one money matter that most Internet millionaires talk about openly is what start-ups they are investing in next. Expect many more such investments from Facebook executives. Indeed, that might be where the biggest chunk of their new wealth will go.

Off the corporate campuses and out of public view, it seems, there is little anxiety about spending. Friends of Facebook employees say that they have talked about buying houses, of course, but also planes — a seaplane even — and works by popular artists like Banksy, whose pieces can sell for hundreds of thousands of dollars. Just do not expect them to post about any of that on their Facebook pages.

To understand the contradictions of moneymaking in the Valley, it is instructive to look at another landmark public offering: Google in the summer of 2004. Just before it went public, a senior manager holding a baseball bat lectured a roomful of Google employees: Anyone who dared show up to work in a flashy sports car would soon find its windows shattered. The story is part of Valley lore. But it is also well known that the company’s three top executives have a collection of eight private jets, parked in a NASA hangar.

Some tech celebrities, of course, are known for being flashy. Both Lawrence J. Ellison, chief executive of Oracle, and Sean Parker, an early Facebook executive, have storied, lavish lifestyles. But there are many more who stick with the conceit of understatement. For example, Sheryl Sandberg, Facebook’s chief operating officer, is building a house in exclusive Menlo Park — much of it underground, hidden from view.

Mark Zuckerberg, Facebook’s chief executive, sets the tone at the company with his trademark rumpled hoodies that display no obvious brand name. He spent $7 million on a large but nondescript home in Palo Alto, a suburb so expensive that even a small, no-frills house easily goes for $1.5 million these days.

In a letter to would-be shareholders when the company filed to go public, Mr. Zuckerberg summed up his corporate philosophy this way: “Simply put, we don’t build services to make money; we make money to build better services.”

Although he has not articulated it with an office memo or a baseball bat, it is understood, say Facebook employees and their friends, that Mr. Zuckerberg would find it uncool for one of his underlings to drive a Lamborghini to the office.

Quentin Hardy and Nick Bilton contributed reporting.

This article has been revised to reflect the following correction:

Correction: May 18, 2012

 

An earlier version of this article referred incorrectly to the jeans favored by Mr. Dorsey, a Twitter founder. While he wears jeans by the designer Scott Morrison, he does not own a pair of Mr. Morrison’s $1,200 custom model.

 

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