Europe's biggest VCs are going to war over adopting China's 996 ‘always on' culture: ‘Don't listen to a jumped-up finance bro in a hoodie'

Yahoo

2 days ago

A war is brewing in Europe's startup community over three numbers that would have mass implications for tech workers, and perhaps beyond: 996.
Stoked by an ongoing debate about Europe's competitiveness with other territories, leaders of some of the region's biggest VCs have waded into a battle startups should be working in order to compete with U.S. and Chinese tech firms.
Harry Stebbings, founder of the 20VC fund, ignited the latest debate last weekend when he said Silicon Valley had 'turned up the intensity,' and European founders needed to take notice.
'7 days a week is the required velocity to win right now. There is no room for slip up,' Stebbings said on LinkedIn. 'You aren't competing against random company in Germany etc but the best in the world.'
His fellow venture capitalist, Index Ventures partner Martin Mignot, followed up in a lengthy post raising the idea of tech startups needing to work long, intense hours now more than ever. The fast-moving world of AI left no time for complacency, Mignot argued, in addition to the emergence of global competition and the need to maximize productivity among workers in a scarce talent pool.
In his post, Mignot cited a 2018 Financial Times editorial by Michael Moritz, the Welsh billionaire chairperson of Sequoia Capital, who suggested Silicon Valley entrepreneurs adopt the then-little-known 996 model. It's where employees work from nine to nine, six days a week, adding up to a 72-hour work week, or double the average weekly working hours in the EU. Mignot credited Moritz with introducing the 996 model to a Western audience.
A representative for Index Partners didn't respond to a request for comment.
Stebbings' and Mignot's remarks caught the attention of both Amelia Miller, co-founder of Ivee, and Suranga Chandratillake, a general partner at Balderton Capital.
'Burnout [is] one of the top 3 reasons early-stage ventures fail. It is literally a bad reason to invest,' said Ivee's Miller on LinkedIn.
Balderton's Chandratillake shared Miller's sentiment, and leveled his criticism at the messengers calling for a 996 culture: 'All the versions of this post I've read are from VCs who've never built a technology company themselves. I remember such 'advice' well when I was a founder. If you're a CEO, don't listen to a jumped-up finance bro in a hoodie who has never done your job telling you how to do it!'
Chandratillake tells Fortune he felt compelled to wade into a public argument on the train home from work after reading what he thought were new versions of a 'dangerous' conversation on expected working hours.
The former startup founder has seen the negative effects of that 'always on' mentality from some founders he has watched knowingly or unknowingly adopt the 996 model.
Those founders tend to 'fail in a slightly depressing, sinking out of significance kind of way,' he said.
'You get addicted to this thing of, 'I'm just gonna make these incremental improvements in my company.' And you're growing a little bit every day, you're building a little bit every day, but you completely miss some big strategic shift that's going on around you, and as a result, you just don't make the right pivot.'
The 'always on' narrative is compelling because it's an easy explanation for complex problems, Chandratillake believes.
'I always say Californians are great at telling stories, right? There's a reason why Hollywood is in LA,' said Chandratillake. 'If a thing takes 10 or 20 years to build, there's just no way you can sprint for that long without stopping.'
Through Balderton, Chandratillake has been an investor in cutting-edge wellness programs for the founders of its portfolio companies, using methods practised by astronauts and athletes to ensure recovery and prevent burnout.
While he advocates for more awareness of physical and mental health among founders, Chandratillake doesn't go as far as to support the idea of work-life balance. He admits he would frequently pull all-nighters at critical moments, like around funding rounds and quarterly deadlines, while building the startup Blinkx, which he eventually took public.
'You have to be smart about having moments to balance yourself, not because you're trying to create this wonderful work-life balance existence, but because you know that in a couple of weeks time, there's going to be a crunch.'
The argument surrounding work culture in Europe isn't new, as opposing voices seek to support or dismiss the idea that a cross-Atlantic divergence in productivity growth is a result of differing work ethic. The sparse number of European tech companies populating the Fortune 500, or the list of the world's most valuable companies, has been used as a prime example of the fallout of this perceived shortfall.
Last year, Nicolai Tangen, the CEO of Norway's $1.8 trillion wealth fund, Norges Bank Investment Management, claimed Americans work harder than Europeans owing to a higher 'general level of ambition.'
Speaking on Stebbings' 20VC podcast last year, Monzo co-founder and serial entrepreneur, Tom Blomfield, took a more nuanced approach, singling out the U.K., where he felt the concept of the 'American Dream' was 'antithetical to British culture.'
Chandratillake said he doesn't subscribe to the idea that Europe is being left behind, and envisions at least three European companies—Spotify, ASML, and Arm—he thinks can hit a $1 trillion+ valuation in the future.
'We might be behind from a timing point of view, but I don't think we're behind from a sort of effort or energy point of view right now.'
As for whether he thinks a four-day week will be the norm in the future, Chandratillake was the bearer of bad news.
'Humans have a way of just making themselves more work. So I think the nature of the work will shift. I think the ways in which you can do it may be more flexible.
'But every 100 years or so, it seems like someone suggests that we're going to all work less, and unfortunately, they turn out to be wrong.'
This story was originally featured on Fortune.com