You may have read this book already. It is not brand new – it came out at the end of last year – and I picked it up in the airport.
The reason I have chosen to review it is simple. It is because it is the best business book I have read for a long, long time and I am recommending it with a gusto to anyone I come across.
In fact, it is the only business book I have ever read which I have wanted to restart as soon as I finished it. It is incisive, it is uniquely researched, its topic is one of the dominant ones of our day (the internet) and above all it is hilariously written.
It is impossible to capture a book’s wit and humour in a short review. Suffice to say, there is a paragraph on page 162 (the hardback edition) that had me laughing so loudly I nearly spilled coffee over myself at Kuala Lumpur Airport.
The author’s track record is largely based on his brilliant investment-banker-on-the-wall account of Salomon Brothers in the 1980s, Liar’s Poker. While that was a tremendous book, Lewis had looked like a one-book man for quite a while. I picked up The New New Thing without any serious expectations, much as if I were buying a Big Mac.
My paucity of expectations was probably an advantage, as I was quickly engrossed. It is the story of an individual called Jim Clark, who is frequently referred to by people in the book as a "maniac". What Lewis does is to hang around with this "maniac" for at least two years, and thus offers a unique documentary of Clark.
So why is Clark significant? Clark was the founder of Netscape and before that Silicon Graphics. He also founded Healtheon – and later, mycfo.com. The first three companies give Clark a unique place in business history. He is the first man to found three billion-dollar companies.
Even more significant is what Clark achieved with Netscape. Because he wanted to build the world’s tallest boat controlled by computer systems, he took the decision to float Netscape before it was even profitable. In the process Clark began the ‘internet financing revolution’ – the model where unprofitable companies could list. Some would say it is the bane of our day, others our salvation. Clark created it and followed up with Healtheon, his attempt to be the Microsoft at the centre of the US health industry.
Among the many brilliant and sobering sections of the book – and one that is especially relevant in today’s market conditions – is the description of the first attempt to take Healtheon public. Lewis is on the roadshow, and describes the whole thing falling apart in conjunction with the market crash of October 1998. The harrowing affair reads a little like the techpacific.com IPO that spammed after the Nasdaq crash a couple of months ago – except that Healtheon was pulled.
What is remarkable is that six months later, the Healtheon deal is relaunched and becomes one of the most successful IPOs in history. Given the gloom surrounding internet stocks today – as a result of the latest correction – this gave me a sense of perspective. Internet finance is not a game of two halves, boom then bust – it’s a continuous cycle, and comes and goes depending on a complex interplay of sentiment.
By any definition, Clark is a rich man, but it is a volatile wealth. At the point when Healtheon’s IPO was pulled Clark’s wealth is worth about $200 million, down from its peak of $1.2 billion a year earlier. Six months later, he’s back up to $3.6 billion. (Which reminds me, another especially hilarious moment is when Lewis sits in with Clark during an interview with a Swiss private banker.)
Clark has an interesting contempt for investment bankers and venture capitalists, a view that seems to stem from his being stiffed at his first company, Silicon Graphics. Above all, he is driven by the revolutionary idea that the engineers who build the stuff should be the ones to get rich, and not the moneymen. He takes great pain in tormenting and playing off the various bankers and VCs that continually enter the picture.
History will also remember Clark for another reason. It was Clark’s hatred of Microsoft that led to the defining antitrust case of our times. He gave the original evidence that got the whole thing rolling and personally contacted the US Department of Justice. His part in the trial is related by Lewis with clarity and no lack of wit.
A central metaphor that runs throughout the book is Clark’s attempt to build the first computer-controlled boat. Lewis joins him on it as they sail across the Atlantic. The boat provides a cautionary tale. Every day at the same time, things start going wrong with the boat. The programmers can’t work out why it shuts down the engine each day at the same time. Eventually the crew has to disconnect the computer’s sensors from the engine.
The boat and its journey is worth a book alone. Weaved in with this insiders tale of the internet business and high finance, it makes this book truly great.
Reviewed by Steven Irvine
Rating: 5 stars
