Whither the individual? Social media gone full circle, forcing the individual to become unsociable!

Something that occurred to me recently was not only the incredible impact that social media have had on people's lives, but additionally, how they have purposefully invaded the privacy of the individual, and further, that they have even affected one's ability to appear to be an individual, anymore. 

Initially, there was not too much concern over privacy in social media use, even if people were slow to realize that basically anyone with a computer and internet access could dig into your Facebook profile, and see photos not only of your family and friends, but also as was the case for many members, peruse their entire social life and circle, all from the comfort of the spying eye's own home. The photos can still be blown up, easily copied, and even messed with as the end user sees fit. Quite why anyone would want, say, photos of themselves on sandy beaches in tiny bikinis on holiday, being readily available to their teachers, bosses, co-workers, bartenders and effectively anyone who remembers their name is beyond me. 

Facebook never did have much concern for member privacy, but under pressure it introduced new features to allow the member to decide how public or private certain aspects of their online identity were, and as worry spread over privacy issues due to the media highlighting it, one saw a more cautious approach to publishing one's entire lifestyle to the world. At the same time, many still felt that it was not a major problem until the inevitable happened: some bright spark realized that social media were the ideal marketing tool for business.  

The effect of this was not felt immediately, as the business world struggled to use social media productively, while trying to find anyone over 35 who had any idea how to use it at all. Eventually they managed to catch up somewhat, at which point the effect of the business world joining Facebook became significantly more noticeable if not downright pervasive. Once people started getting fired from their jobs for compromising photos, or comments such as "I hate my f***ing boss!" on their profiles, people began to realize that the party was over.

When courts began to reinforce the new status quo by upholding various cases of unjust dismissal, the message was hammered home more clearly: it does matter what you post on your "personal" Facebook page, and even if you go totally private, employers still want to see it. Yes, they have absolutely no legal right to see it, but do you want the job or not?! When it comes to jobs, employers are always in the driving seat and you telling them that they have no legal basis for demanding to see it just helps them move on to a candidate with a lovely pastel-colored flower-filled timeline profile, and it's all over. 

With the introduction of Twitter (by default, an intentionally public gossip service) and LinkedIn (specifically for job seekers/employers), social media as quality control analysis of the individual expanded in scope. It became totally the norm for employers to not only go digging surreptitiously (initially) into your online profiles, but later on, employers began to actually ask for your online profile addresses and usernames as part and parcel of the interview process. 

Saying no is not an option, which is frankly, outrageous, and while they claim that if you are not willing to share then you must have something to hide, I say that it is none of your goddamn (for want of a better word!) business - period. One ridiculous current trend is the need for certain types to insert at the tail end of their Twitter profile: "Opinions expressed are my own and do not reflect those of my employer". They have to do this because they want their employer's brand associated with their profile, as part of making them look "cool"; perhaps even feeling like a pseudo minor celebrity of their very own. "I have got a lot to say, of great significance, and I have a huge audience of 'followers' (quite typically the same number being followed, rather sadly) who read my every word, but I need to make it clear to y'all that I am not speaking for the brand, blah blah". Yawn. 

It's cool to say that they are a tech geek at Apple, or a director at Facebook, or a programmer at Google, so they put it in, but follow with a disclaimer. Then they feel free to dive in and often use expletive-filled comments and replies to friends, and make strange sociopolitical commentaries on the side. It's a case of wanting to have it all. They want their famous employer's brand on their profile to up their status in life, but then want to make it clear that their voice has got nothing to do with that employer: so what does that mean? It means that they should have nothing to do with each other, outside the office, that's what it's saying! Hell, it might even be saying very clearly that they simply fake it at work, and in fact do not fit with their employer's brand, at all. 

But the very fact that they associate themselves with the brand means that the profile is not exclusively theirs, and will be up for scrutiny. A disclaimer changes nothing. Do you think that an employer would not change their opinion of that charming blond girl from the design team, upon seeing that she has tons of hidden tattoos and has a wild Twitter profile full of radical politics and language that is more commonly heard on a construction site? Of course they would look at her differently, and human resources would be alerted to it. 

As always, employers have the upper hand, especially if you want (to keep) that job. The Catch 22 of making your online life private to all but close friends/family (which is the totally normal thing to do) is that it raises a red flag in the human resources department. "What are you trying to hide?" The other Catch 22 is that if you do perform a quick spring cleaning and get rid of those drunken college trip pics, and the one with the football team eating sushi off your almost-naked body, then you have joined the club. Once you go public, with an employer, then you are public, period. Squeaky clean is the new norm.

This might not be such a serious issue for someone who lives a fairly quiet life and generally has nothing to hide, although someone in your circle could still post something wild onto your profile which your employer may get to see before you do, if you are busy. Or, if you are prone to compete in wet T-shirt contests in your local Hawaiian bar on Friday nights, then it's not enough to make sure that you don't post any pics of it online. Why? Well, because someone else might. There's always some sneak who loves to catch people in compromising positions on their cell phone camera, with no one aware of the recording of it. Just ask Michael Phelps or Robin Thicke (among many others), for example!

So where do we stand today? In many ways, it has returned us to where we were before: where our private lives were private, and our public face (which now includes our online identity) at work/outside was public. In other words, social media have become so pervasive and even career-threatening that for many they now represent only the public face of  our real lives. The public face and the reality are now formally separated once more. 

This is highly ironic in that many used to use social media to show off their private lives in public, but they now are forced to massage and sanitize that life, to make it suitable for public viewing. All because employers became sneaks and demanded to see a Facebook profile as if it was their right: it is not. But guess what? Telling a potential employer that you don't have a Facebook profile because you think it is worthless, as a way of avoiding the invasion of privacy, will only get you classified as "old" or "a potential sociopath" and you still won't get the job!

So now Facebook becomes a place to present some kind of fake sterilized version of ourselves, doing our best to strip away any individualistic traits, so that we appear to be the standard issue well-balanced production line humanoid model that employers theoretically believe in. Even though, if they believe that candidate employees have any higher form of intelligence whatsoever, then they know that they are looking at a clean cloned profile, or a purposely bland standard (i.e. mind-numbingly boring) identity?

Whither the individual? Whither one's right to stand out, fiercely and proudly, and be as exuberant as one wants to be and is, on a social media website? It has got nothing to do with the workplace, and as long as one is doing a great job in the office, and does not go out of one's way to put down the boss/company online, it has nothing to do with the office. It has almost come to the point of people needing one fake public face, for employers, and also a real but private online identity with a different name or nickname, that only one's true blues are aware of! Once you know that your employer is watching you on Facebook, it is no longer either private or free: you pay a price on a weekly basis for being there, whether you realize it or not, and whether you like it or not. 

There is way too much sharing in this brave new world of social media. Those that hide or are mysterious have become outsiders, and are peered at suspiciously by the rest of the herd. But let me ask you something - when you were in a class at college, or in an office at work, who was/is more intriguing and interesting - the guy/girl who insists on telling you their entire life story over a thirty minute lunch, or the one who is friendly but a little more mysterious and aloof, and who only shares themselves in detail with a select few? There is value in dignity and privacy!

To each their own, but being one of the sheep is such an undesirable state of affairs that it is simply quite tragic, I'm afraid. We need to celebrate the individual, and individuality; it's a characteristic that is admirable but one that does not need to live in eternal self-promotion and does have a total right to privacy. The individual can be experienced in real time and as a living person, only, because he/she is much too busy and way too happy living a life to spend even an evening trying to present some scrapbook version of that life on some social media website! 

On that note, it is time for this individual to grab a Tim Horton's Dark Roast, put on his office face and present an unsocial media personal profile - and if someone dares mention blogging, I am programmed to reply: "Blogging? Yeah, I've heard of that!" - :)

The biggest start-up in the world or an old behemoth trying to buy its way out of extinction?

 

Unquestionably, the recruitment and hitching of Marissa Mayer's star to the aging, aching, ailing Yahoo brand and logo could only have been viewed as a positive move for a company that had completely lost touch with the times it lived in, and had thus left many with few reasons to believe. Anymore.  

Yahoo somehow had let it all slip away; formerly glittering bejewelled crystals of sand poured out through the widening pores of a veritable pillar of salt of their very own making, converted into a cold, hard new composite that was interlaced with the reality that the dream was almost over. It piled up around the foundations, and walls, and once it began to seal off the windows and cut off the light, a previously precious "warmth" was gone. And there's a huge difference between feeling "cold" and looking "cool" in the high stakes business of high tech - or in this case, make that mobile tech.

Marissa has been on a shopping spree like almost no other for the past year and a half, and has thrown some twenty-plus start-ups into her shopping cart (presumably using a much more mobile-friendly and up-to-date provider for the online transactions!) since taking the reins at Yahoo. Kudos to her for realizing that the linchpins of the company's online image and business, Yahoo News, Yahoo.com and various online communication tools all needed a serious kick in their low-tech rears. 

But it's historically been all about advertising, and less about end users of Yahoo. My men on the street tell me that today there is a whole new vibe on the 17th floor of their Manhattan offices, with a clear and purposeful switch to start-up atmosphere with teams of engineers running amok riding the new wave. Someone smart (I wonder who?!) made the conclusion that mobile media (make that mobile life!) was the way forward - yet there won't be any Nobel prizes for coming up with that pearl of wisdom. At other companies, it is neither the way forward nor the future. Why? Because that "future" is already here - it is now. Today.

The fact that Yahoo are so far behind is a total indictment of how long and how deeply they have been asleep at the wheel. Somehow, as a shareholder, pictures like the one above, with Ms. Mayer arm-in-arm with a bunch of kids and tech geeks, does not exactly make anyone go all warm and fuzzy nor all "oh-ah" as they check the share prices which are far from romantic. 

"I'm pleased with Yahoo!'s performance in the first quarter," Mayer said in April, 2013, after revenue had slipped, again. "I'm confident that the improvements we're making to our products will set up the company for long-term growth."

Now I am all for a head honcho defending their brand and standing strong in the face of deadly Bering Sea-like storms, but at some point one must acknowledge the issues, and rather than deny them, actually admit them publicly and take a stance on how one intends or is going to resolve them. A little over a year later from the quote above, a less sanguine Mayer yesterday addressed this past quarter's status.

"Our top priority is revenue growth and by that measure, we are not satisfied with our results. In Q2 we saw display revenue decline, further highlighting the fact that we need to work faster to ameliorate the negative trends. I believe we can and will do better moving forward."

It's hardly going to make anyone jump up and down and yell "Woohoo!", is it? This was in response to an extremely depressing revenue (after ad commissions) of barely one million dollars for the last quarter, which some analysts are calling "dismal". The storm continues unabated, and the board will only be willing to chip in and bale water out of the bilges for so long before the inevitable first mutinous whisper about a new captain rings out. 

While I am glad that our Marissa has confidence, that is hardly a surprise for such an over-achiever, yet it is not enough to keep most of us warm at night. They can create a tech locker room nerdy boys club type of office all they want, and engineer the bejesus out of their creaky old rusty ship but there is one critical aspect that I think that Ms. Mayer should not let get buried in her clear desire to be "one of the lads" - or "one of the lasses" for that matter!

To what do I refer? Well, we will have to go back to web presence 101 for that one. It was called "web content" for a very good reason. I continue to be appalled at the lacklustre (often that's at best, sadly) and much too occasionally woeful excuse (at worst) for content that appears on many news items and blog posts directly associated with the Yahoo brand. 

It's all very well recreating the great-free-snacks-and-pinball-machines-and-basketball-hoops playroom already hash(tagg)ed to death by the likes of Microsoft, Google and Facebook - but engineering can only do so much. You can build the most accurate and pristinely perfected car out of some magnificent engineering, all you want, but what if someone fills the tank with diesel and not fine grade unleaded? It's not going to be long before the inevitable stall.

It's all about end user and that user's experience, hands on, when it comes down to it. Mobile versions of the major Yahoo online offerings will only carry the car so far - unless the gas fueling it is of the highest quality possible. In this case, the analogy is that the content is the gas. You can go ahead and spend millions developing the new tools, but unless you attend to issues to do with the content accessed by those tools - you can forget it. Content is king, with a capital K, and there is still much work to be done.

Now it's not shocking that Ms. Mayer is heavily focused on engineering and product development - that's her core expertise. But as CEO, she needs to dive into the deeper end of uncharted waters, and address the content posted with the Yahoo brand tagged to it, especially the Canadian franchise. There are still way too many posts (blogs in particular) with titles and a blank space beneath, or a sloppily written excuse for content with typos, grammatical errors and words that mean nothing at all - collectively implying that the people she called back to head offices for "phoning-it-in" continue to do so - only they do it now from head office. Need an example? Here is an opening sentence on a blog from a big Canadian day, October 10, 2013, on the announcement of the first Canadian writer to win the Nobel prize for literature:

"Celebrated Canadian short-story writer Alice Munro, who announced her retirement earlier this year, has won the prestigious Nobel Prize in Literature, becoming the first Canadian-based to earn the honour."

Did you spot it? It's quite typical but far from some of the worst examples. These people ripped Yahoo off, and I sincerely hope she knows it. There were one or two names in particular who regularly posted titles with zero content, and I have a funny feeling that these people billed Yahoo for producing "x"such pieces per month, and no one bothered to check the content. Or the blank space beneath the title. It was, is, and should always be a total professional embarrassment to all senior management at Yahoo, and that means Ms. Mayer too. 

Yes, I know she bought tumblr, thereby accessing some real content (making a nice change), but it cost her over a billion dollars to do so. It's hard to call your company "The biggest start-up in the world" when you can afford to buy other real start-ups for over one billion dollars to boost your own brand! To date she has acquired over twenty of those real start-ups. It's quite ironic that she also needs China to maybe even survive, via her dependence on revenue from Alibaba, which is expected to go public shortly. If the Alibaba IPO is a bust, there's gonna be tears all over town.

In terms of content, calling Yahoo a "big start-up" is disingenuous. It's only like a start-up in terms of where it's not today, in relation to where it should be, already being a household name and part of the zeitgeist. Yahoo the "start-up" is a true oxymoron. One that Ms. Mayer is not going to get away with much longer. Yahoo is now officially a 20-year-old in 2014, and guess what - it's time to grow up - the teenager's adolescent years are over. 

But you gotta give the gal a break - she's trying, at least. It probably is a little cooler to be a yahoo today. But the baby is all grown up, or should be. And we had a honeymoon, which is shortly going to be over too - today is in fact the second anniversary of Ms. Mayer's tenure as Yahoo CEO. Either Mayer and Yahoo deliver on the promise of transporting the brand into this decade (or beyond) or I fear that Ms. Mayer will be visiting that beyond in the form of the circumference outside Yahoo world, maybe even before all those young engineers hit their big 3-0. 

"Transformation is not a singular event," she said. "It's a series of events and quarters, some more challenging than others and some more successful than others." 

Ya think?! I think she can do it. She probably knows she can do it. But engineering is just the mechanics. You need the gas and you need the best drivers - and that can only come with a renewed and reinvigorated overhaul of that dirty word - content. When the day comes that she can look into the Yahoo mirror on the wall, and tell it that she is more than content with her content, then that's the day to go all "Woohoo!" over Yahoo! 

AbbVie flexing its abs, but getting some resistance training!

Given that we were just recently on the subject of M&As and even potentially hostile takeovers (e.g Valeant-Allergan or Pfizer-Astra Zeneca), it seemed timely to comment on another very large transaction being attempted by an  American company to gain control of a UK entity. In another increasingly pubic approach, we are back once again to the video game-type activity of "invasion and inversion"! 

In this case it is the recent move by US-based AbbVie to take over UK stalwart Shire, undoubtedly once again due to favorable tax synergies achieved by any such acquisition. The interesting aspect of this situation, though, is that nowhere near the same level of ballyhoo is being generated in the UK by this attempted takeover as was observed in the recent Pfizer play - and the key question is why?

When Pfizer was attempting to swallow up AZ, it caused national outrage at a level that roped in the fury of various MPs and escalated all the way up to James Cameron, the UK's Prime Minister. This led to a grilling of Pfizer CEO Ian Read that made one think he was actually Gordon Gekko, corporate raider extraordinaire, and not the legitimate head honcho of a money-printing big pharma company. I am not even sure that Tony "Wayward" Hayward (ex-BP CEO during the Gulf Of Mexico crisis in 2010) got treated with such paranoid suspicion, even after his now legendarily devastating PR soundbite from Hell's darker chambers - "There's no one that wants this over more than I do. I'd like my life back."

That short line was truly a nail in the vampire's coffin, if not an outright stake through its heart, as the rich black blood pumped vigorously all over the real coffin that the Gulf Coast had by then become. But I digress, and even though Ian Read was treated with a similar degree of vitriol, all he was trying to do was enact a little bit of corporate raiding, with no devastation to wildlife populations or pollution of seafronts or unemployment creation for thousands of people - right?

Well, right, but maybe wrong on that last point! The major difference between AZ and Shire is that, perhaps ironically, Shire is viewed as inherently less "British"" than AZ. While Shire has been in the UK since around the mid-eighties, it conducts most of its business in the US and has a tax berth in Ireland, where corporate tax rates are some of the lowest available on the planet, at around 12 percent currently. When you factor in that the UK is still around double that and that the rate in the US is around a whopping 35 percent, you can see where the value in such deals is truly derived, at least in part.

Of course, Shire does have a fantastic pipeline and its speciality in rare diseases is an aspect that AbbVie has a keen interest in assimilating, and thus it is overall an incredibly attractive acquisition target for AbbVie - even at the whopping price of $46B. The lack of furore in the UK over this deal probably goes back to that last point above - jobs. While the takeover of Shire and its US-based operations and workforce would impact employment very little in Britain, the loss of AZ and its almost seven thousand UK-based jobs would put those very jobs in harm's way, and this is key to the very vocal opposition to Pfizer's acquisition of AZ.

Thus the Shire deal could proceed with little fuss, except that in this case Shire CEO Flemming Ornskov is making his own case for independence, particularly in the face of what he deems an under-priced offer. He has laid out plans to double revenue to $10B by 2020, with three-quarters of that derived from marketed drugs (e.g. Vyvanse for ADHD) with the rest coming from pipeline. Additionally, Ornskov, no shrinking violet when it comes to acquisitions himself, has done six deals since his appointment just over a year ago (including the $4.2B acquisition of Viropharma) and while Shire's market cap was $19B when he took over, it currently sits at $44B - so he's in a very strong position with shareholders and analysts alike!

Ironically, all of this attention has only initiated a feeding frenzy of acquisition interest around Shire, and even Botox-maker Allergan, in its own contentious fight for control with Quebec-based Valeant, has been circling the wagons around a potential Shire takeover. It could all be a very smart play by Ornskov to drive the price up, and analysts believe that once a bidder hits above the magic £50 per share (the previous AbbVie offer was around £46) then Shire may have to accede. This may also be the case even for AZ, if Pfizer returns to the table as early as August with an even stronger offer, as predicted by various analysts and insiders on that deal.

It's all grist to the mill, as they say in the trade, and once a perfectly acceptable price has been offered for the grist, well, what are you gonna do? This is the question facing the CEOs, boards, shareholders and lawmakers involved in these massive potential deals, and rather them than me! At AmorChem we also have a growing portfolio of candidates including those for rare diseases, like Shire, but so far at least we don't have to face the billion dollar (plus) question!

My biggest question right now is whether to go running on a lush green mountain or to collapse into soft cushioning on an equally lush green terrace. Questions, questions! But you know, one can have it all, some of the time, so off to my personal Everest I go, and then I get to collapse into a hammock, guilt-free. Now that's a win-win!

[In a timely update to this post, as of its publication this morning it was announced by AbbVie CEO Richard Gonzalez that the offer is being sweetened by around 11 percent, bringing the price-per-share up to around £51. It did not seem to go down well with Shire that this announcement was made public prior to Shire actually receivng any such offer, and the fact that Gonzalez indicated that he had had discussions with controlling Shire shareholders who now support the deal - in the absence of written statements to that effect - is unlikely to bring the parties closer. In fact, Gonzalez has just been forced to retract the statements regarding having the support of majority shareholders at Shire. If Shire are unwilling to come to the table and begin negotiations based on this new offer, it seems that this may indeed turn into a hostile takeover.]

Invasion, inversion and tax aversion!

        =  Big $aving$

I read of an extremely exciting deal for Ireland-based medtech company Covidien this week, who have been acquired by the giant Medtronic for a staggering (to me, anyway!) $42.9B - yes, that is billions - with a capital B! As far as I am aware, this is the biggest medtech transaction in history. Being acquired by a giant for an equally giant price is the dream of almost every start-up, but this type of deal not only raises eyebrows due to one fundamental reason for the (price of) acquisition, but also raises questions for entrepreneurs about where one should start up one's start-up!

Of course I am referring to the sweetheart part of the deal for Medtronic, which comes down to a term called "inversion", whereby one company buys (or merges with) another that is based in a country with a significantly lower tax rate, thus lowering corporate taxes to a significant enough level that one is even willing to pay an inflated price to get the other. It's not that much different from the various English rock stars who developed a sudden taste to be at least pseudo-Irish and go live there, so they could take advantage of the heretofore extremely favourable treatment by Ireland of artists, in terms of taxes. 

While such tactics remain perfectly legal in the corporate world, legislators in both the EU and US have had their feathers ruffled over such shenanigans in recent years, not least due to the scandals arising out of them, typified by the national outrage in the UK over the fact that Starbucks (among other giants such as Amazon and even Facebook) had paid virtually no taxes to the UK in essentially a decade. Since its introduction into the UK about 15 years ago, Starbucks had reputedly paid a mere £8M in taxes (by late 2012) despite sales of over £3B, and it had apparently paid no tax at all since 2009!

Similar stories have appeared for Amazon in the UK, where, in a recent tax year, the company paid a total of nothing in taxes to Her Majesty, while raking in sales of DVDs, CDs, and books to the tune of some £3B, all due to registering their European HQ in tax shelter Luxembourg. Ditto social media behemoth, Facebook, who with a cosy Republic of Ireland HQ in Europe, managed to pay barely a quarter of a million pounds in taxes in a recent year, alongside reported sales of some £20M, and with estimated advertising revenue soaring as high as almost £300M. 

It's all very good for business, as the numbers above, alone, indeed show. For a giant medtech company like Medtronic, it undoubtedly makes solid business sense in that they get to expand their offering to an already considerable client base, while coincidentally managing to lower costs. But you can see why lawmakers bristle at these manoeuvres, especially if in this case you are an American lawmaker and you see all those juicy tax dollars being whisked off to Ireland where a large part of them thence becomes actual profit. 

This despite the fact that Medtronic will continue to have its de facto operational HQ in Minnesota, employing several thousand, while the corporate offices are at least theoretically based in Ireland. It's a ploy, if not an outright play, and similar reasons undoubtedly lay behind the failed attempt recently of Pfizer to take over UK-based Astra Zeneca. You can't blame people for trying, but there has to be value for the targeted country also in any inversion move, and the UK as a nation seemed opposed to this particular play by Pfizer. 

Unquestionably, consolidation is an inevitability in the booming orthopedics segment, due both to various entities being keen to scale their operations, as well as a changing and challenging healthcare system in the US. There have been similar deals by other big players of late, and that includes Zimmer's acquisition of Biomet and Stryker having done a number of deals, including their swallowing of Small Bone Innovations just this past week (for $375M).  Experts in the space have been clear that the economics will work better when there only a few big guns delivering the entire orthopedics market needs directly into the hands of surgeons and hospitals.

Ireland is not the only option available for such an inverse move and in fact Canada was in the news in the past week with the merge of Vancouver's linchpin biotech QLT with Pennsylvania-based Auxilium Pharmaceuticals, creating an offshoot entity to be called New Auxilium. There is little argument over the fact that a lower corporate tax rate was a heavy duty factor in this merge, on top of improved exposure to the Canadian marketplace for Auxilium. 

So, where you decide to start up your start-up could actually eventually play a part in how attractive a deal may be to a party resident in the US, in terms of them deriving greater value in such a deal via tax-based synergies. It's not a trivial point and it is currently driving some very big deals indeed, as this deal between orthopedic giant Medtronic and Covidien clearly shows.

At AmorChem, we are more than happy to see the burgeoning global orthopedics market (estimated to be not far off $50B) continue to evolve via such a vigorously active deal space, not least because we are co-developing a porous titanium compression screw that would insert very snugly into the portfolio of any expanding orthopedics enterprise - big or small!

Now speaking of mergers and acquisitions, I need to acquire a fresh mug of this new Pharaoh's Perfection Morning Blend, and then merge deeply with the chaise longue under the sunny silver walnut tree. Until next time, that's it from me!