The Future of Success (18 page)

What this does for the wealthy individual is incalculable. Suddenly he has become someone with access to a powerful ear—become a person, it is presumed, with connections, a person of influence. Such a reputation is valuable to him socially, financially, and in all the dimly lit areas in between. It gives the people with whom he does business the sense that he can deliver on whatever he proposes. After all, if he commands the attention of a President or a leader of Congress, he must be capable of opening any door below that exalted level and, by extension, of getting his way. It doesn’t matter if this inference is incorrect. The appearance of power means that from now on his clients, customers, suppliers, creditors, investors, and contractors will be that much more willing to cut a deal.

In return, the politician may or may not get a campaign contribution directly from the wealthy individual. But as far as the politician is concerned, that donation is not the point of the transaction. Through the wealthy individual the politician gains access to a network of wealthy people: the individual’s friends, business partners, and colleagues, and members of his club or board. These new contacts may have previously harbored misgivings about the politician’s values or objectives. They may have heard unflattering rumors. But now the wealthy individual’s relationship to the politician reassures them: the photograph, the handwritten notes, the golf, the coffees. “If our colleague likes and trusts this guy,” they say to themselves, “perhaps we should be more open-minded.” The wealthy individual introduces them to the politician when the occasion arises. The politician is not a bad fellow, they conclude. And then come their own invitations to breakfast, dinners, golf. Members of the network are reassured, charmed, seduced. In time, the new acquaintances will give money, and also ask that others do so. The connections are made.

No policy has been altered, no bill or vote willfully changed. But inevitably, as the politician enters into the endless round of coffees, meals, and receptions among the networks of the wealthy, his view of the world is reframed. The seduction has been mutual. The access that the politician provides the wealthy and the access that the politician thereby gains to the ever-expanding network of money reinforce each other. Increasingly, the politician hears the same kinds of suggestions, the same voicing of concerns and priorities. The wealthy do not speak in one voice, to be sure, but they share a broad common perspective. The politician hears only indirectly and abstractly from the less comfortable members of society. They are not at the coffees and the dinners. They do not play golf with him. They do not tell him directly and repeatedly, in casual banter or through personal stories, between sips of coffee, how they view the world. They do not speak continuously into the politician’s ear about their concerns. The politician learns of their concerns from the pollsters, but he is not immersed in them the way he is in the culture of the comfortable. In this way, access to the network of the wealthy does not buy a politician’s mind; instead, it nibbles constantly, sweetly, at his ear.

At regular intervals, the United States piously accuses certain nations of being in the thrall of “crony capitalism,” where, despite advances toward free markets, prominent people continue to bestow important economic favors on friends and associates. But perhaps we are also susceptible to the charge. The increasing importance of personal connections here, as elsewhere, puts people who are inside the web of powerful connections at a distinct advantage.

THE DISCONNECTED

In many respects, the new economy is an equal-opportunity employer. With talented geeks and shrinks in short supply, no organization can afford to discriminate on any basis other than ability. Racial, ethnic, or gender bias was a luxury affordable only to managers with broad discretion to do as they pleased. Fierce competition is forcing them to do what pleases their customers and investors instead. As a result, significant numbers of well-educated blacks and Hispanics have moved into the American middle class, and some into the upper reaches. Women are ascending professional and managerial ranks as well. Look at the most nimble entrepreneurial groups, and you’re likely to find a diverse mix; peer into the top tiers of companies in the fastest-moving segments of the economy, and you’re sure to see a far wider variety of human beings than you’ll find in the executive suites of old large-scale bureaucracies.

Nonetheless, minorities and women continue to be underrepresented among corporate chieftains, law and consulting partnerships, fund managers, tenured professors, and the top ranks of foundations, hospitals, and other nonprofits. The “glass ceiling” is thick and double-glazed. For blacks and Hispanics, this is partly due to the overlapping residue of race and poverty; young people of color still tend to grow up in poor neighborhoods with single parents and lousy schools. For women, it’s partly due to their desire to have families and thereby move to the slow track or off the track entirely. But another reason for the relative scarcity of minorities and women in high places is the growing importance of connections. Relative to white men, minorities and women still lack them.

The “old boy” network is being replaced by an “attest for” network in which the best jobs go to people whom others already in the network know and can vouch for. Poor youngsters who barely finish high school have no set of friends, parents’ friends, or friends’ parents who can murmur nice things about them to people in high places, and thereby open doors to jobs and clients. Women seeking top positions have no readily available pool of women on boards of directors, trustees, and tenured faculties who can personally attest to their competence and thereby overcome the skepticism of some men in high places. Internet connections don’t compensate for these deficiencies. If anything, as I have argued, the new ease of communication actually increases people’s reliance on referrals and recommendations from people they know, on whom they rely to filter the cascade of incoming messages. And the people who make the referrals and do the deals are still, overwhelmingly, white and male. Among the most important purposes of “affirmative action” in the new economy is to broaden these informal networks to include the socially disconnected.

MAKING A NAME

Connections are a start. They give you a foothold, an interview, a first job, access to a powerful ear. But to make a name for yourself in the emerging economy, you need a means of continuously attracting new business your way. Success depends on linking up with a name that already has the power to draw business, and using it as a springboard to develop your own. It is directly analogous to the symbiotic relationship between small niche businesses and big brands that we examined in Chapter 2.

It’s a common misconception that easy entry into the market through the Internet reduces the need to make a name—that superior products or services will automatically attract customers. If the prolific horror novelist Stephen King can distribute a best-seller over the Web, then why not you? Just pull your old unpublished novel out of the dresser drawer, put it online, and sell millions of copies direct. Don’t fool yourself. Even if quite respectable, your novel will be lost amid the noise and clutter. Here, as elsewhere in the new economy, buyers need guidance.

Musician Todd Rundgren has his own Internet site where you can download a sampling of his latest creations—electric-guitar pyrotechnics and synthesized percussion, overlaid with rap and blues medleys that emerge and then disappear into a sonic soup—and if you like them, subscribe to receive Todd’s music as it emerges directly from his studio throughout the year. In this way, Rundgren circumvents the record companies and all the people who advertise and market company labels. “[I]f I were to go to a record label and ask for a deal, they would make a guess as to how many people would buy the record and give me an advance based on that number, in effect lending me some fraction of the money that my fans would eventually (2 or 3 years later) pony up,” Rundgren writes on his Web site,
¹⁴
summarizing the old industrial model of selling music. “It occurred to me that with the aid of some modern advances, I could go directly to my audience, ask them if they would commit to buying my music, and then deliver it to them as it is produced.”

You may have a lovely singing voice or a great band, and you can now post your music at any number of “MP3” sites on the Internet. But don’t count on attracting many fans simply by doing so. There are too many other voices and bands there already, and the numbers are growing daily. To attract a following, you’ll have to promote yourself. Rundgren didn’t start his career on the Internet, and his innovative music hasn’t attracted many fans there directly. Before he launched himself into cyberspace he had already built a following. Rundgren was heavily marketed. Advertisers and promoters for the record labels for which Rundgren worked had drawn attention to his music, as had the promoters of his tours. In his new online incarnation, Rundgren has, in effect, moved this marketing “in-house” and altered its techniques. Presumably he’s hired people to design and upgrade his Web page, write the software, publicize and promote him, and manage the Rundgren brand overall. In short, the Internet has not reduced the need for marketing; it has merely given people other means of promoting themselves.

Rundgren’s passage from record label to personal brand is mirrored elsewhere in the emerging economy, and not only on the Internet. About as far as you can get from synthesized percussion is the hushed New York investment house of Morgan Stanley Dean Witter, a distinguished brand with an impressive roster of blue-chip clients. Inside Morgan Stanley are many people busily making their names, including Mary Meeker, who advises both institutional investors about where to place their Internet bets and Internet start-ups about how and when to offer their shares of stock to the public. As I write this, Meeker is considered hot. At age forty, she’s the top-ranked Internet analyst on Wall Street.
Barron’s
calls her the “Queen of the Net.” On a typical day she gets about fifty voice-mail messages, roughly one hundred e-mails, and up to a dozen requests for press interviews or public appearances. She has a bevy of secretaries and assistants. She travels at warp speed. Internet companies are desperate for her advice, as are investors.

This didn’t happen because Morgan Stanley recognized Meeker as being clever and insightful and promoted her up through the ranks, as would have been the case in the old economy. Meeker was clever and insightful, all right, but she promoted herself. After graduating from DePauw University with a double major in business and psychology, she worked at Merrill Lynch for two years, and then received a Master of Business Administration degree from Cornell. In 1986, she joined the New York investment firm of Salomon Brothers, where she became a junior research analyst covering the personal-computer industry. After three and a half years there, Meeker moved to Cowen & Company, another New York investment house, as a PC analyst, and then, in early 1991, she was hired by Morgan Stanley, which wanted to build up its PC expertise. In December 1993, Morgan Stanley managed a stock offering for an Internet service called America Online. Even though it was losing money and its shares were selling for about 95 cents each, Meeker recommended it to investors. America Online’s shares are now trading for about $175 each. By the time you read these words, they may be trading for far more, or far less. No matter. America Online’s meteoric rise after 1993 helped fuel Meeker’s meteoric rise.
¹⁵
In the mid-1990s, she and an associate wrote a voluminous paper entitled “The Internet Report,” which described the Internet revolution and sparked a heated debate within the computer industry, many of whose companies were still skeptical about the Internet’s commercial potential. She followed it up with two further reports, both of which were widely read. She became an Internet “thought leader.”

Meeker’s compensation in 1999 was reported to be in the range of $15 million, surpassing that of many of the suspender-clad bankers at the firm. Many of the “dot-coms” have lost their initial luster, but Meeker still has hers. She doesn’t need the Morgan Stanley brand to attract business to
her
as much as Morgan Stanley needs the Mary Meeker brand to attract business to
it.
In 1999, Morgan Stanley earned some $100 million in fees underwriting Internet initial public offerings, many of which came to the firm because Meeker was there. “We don’t compete against Morgan Stanley,” says the head of technology investment banking at a rival firm. “We compete against Mary Meeker.”
¹⁶
It is in Morgan Stanley’s interest to pay Meeker the value of her brand to the enterprise. Presumably she’ll remain with Morgan unless or until another investment house believes her brand will be even more valuable to it and makes her an offer she can’t refuse.

Individuals now blaze their own career paths by making their reputations in their fields, not in their organizations. Decades ago, most journalists toiled in anonymity. Pick up a magazine from the fifties or sixties and you’ll rarely find a byline. The brand was the journal’s, not the journalist’s. But in recent years there’s been a marked shift. Although
Time
has scarcely changed its format over the past quarter century—each week, about eighty-five pages; a major cover story, twenty or so articles, shorter news briefs, sidebars, and an essay—in one respect the magazine has changed significantly. It has been giving steadily greater prominence to its writers and reporters. In the 1970s, no names were associated with any of its articles. In the early eighties, about half its articles ended with the names of writers and reporters, in boldface type; by 1988, the names of essay authors were displayed prominently just under the title; in 1990,
Time
began listing lead authors under the titles of about half its articles; and by the mid-nineties it was listing them at the top of every article. Now it even features a page of biographies and photos of columnists and contributors.