Theranos paid this company "IncRev", and their CEO Shekar Chandrasekaran, $159,000/mo to host a database for them? That's an impressive scam! I wonder if it's money laundering or paying off friends, since any mildly competent technologist in the company would laugh them out of the room.
Nothing worse than Janet Yellen getting paid $500k speaker fees to talk to Citadel and a long list of other Wall St companies she will soon be directly regulating at the treasury dept.
She wasn’t getting paid the $7M total because of her deep interesting take on markets. They wanted direct access to the power players and to see how their mind works.
This revolving door with industry and policy makers gets a very uncritical eye by the media (especially compared to other frivolous background details) and obviously by the self morality of the participant speakers themselves.
I personally hope Chandrasekaran gets in trouble for hiding evidence. But nepotism and conflicts of interest seem to be super common in the upper tiers of industry and politics, which Theranos famously surrounded themselves with, right down to their board of directors being politicians and ex generals.
>She wasn’t getting paid the $7M total because of her deep interesting take on markets. They wanted direct access to the power players and to see how their mind works.
Eh. People make these kinds of statements, but though that may be true in some cases, it isn't true in many other cases. For example, there are plenty of organizations that are flush with cash that want a political celebrity (whether it be Yellen, Hillary Clinton or Obama) to come and speak to their membership or conference without expecting anything in return other than the speech they give. Why? Because people like to be around celebrities, political or otherwise.
I attend healthcare conferences where attendees number in tens of thousands (paying hundreds per attendee to attend) and hundreds of vendors paying hundreds of thousands or millions to display and advertise their products... For that conference to shell out $500k to have Hillary Clinton do an opening speech is peanuts.
Janet Yellen was one of the most powerful people in the world. If you want Beyonce to play a private concert for your company, you'll need to fork over $1m+ per hour. Why shouldn't an equivalent rockstar in the macro world be allowed to charge similar rates?
Because Beyoncé won't be (directly) shaping policies that can benefit your company? The price isn't the problem, the conflict of interest is, even if it's just a potential one. Much more unlikely with a rockstar.
Janet Yellen isn't a powerful person because of her reputation on the speaking tour circuit. If you hire Beyonce it's because you're paying for the performance she gives. If you hire Janet Yellen, no person credibly believes it's because that hour talk she's giving is hugely valuable. It's because you want to establish connections with her to influence her in her actual job where her power comes from. It's a pretext for paying her money that, were you to turn up to her office and hand it to her at her day job, would be a bribe.
From my own personal experiences, the most you typically get with a high profile speaker is the email address of their assistant or the agent from the speakers bureau.
You can watch performances on Youtube as much as you like, with perfect sound. Most of the time, you hire in-person Beoynce for prestige. Same with Yellen.
But former Fed chairs in the past have rarely if ever gone on to other positions of political or regulatory power after their terms end. What were they paying for then under this theory?
When someone is in charge of way more money than that I think you want a sinecure for them after they leave so they don't fuck things up for you if they get restless.
Care to actually respond with some substance instead of snark? I'm genuinely curious about the Jackson Hole type of meetings. Are you saying her talks are indeed of some great value and insight, and not about access?
Thank you for responding. Yeah, I think thats fair, though I didnt understand the other poster to be saying they were changing policy, more that speakers were charging for knowledge/acess, which is a different thing.
The funny thing is that I don't actually disagree with you. The entire thesis that "paid speech equals corruption" is silly, though it may be true in some specific situations (and to further steel-man the position, the optics can be bad which can lead to citizens distrusting the motivations of the politician). I, myself, made a comment stating as such [1]. But writing comments impugning HN or HN users for having the audacity for upvoting comments, or having an opinion, lowers the discourse more than the opinion itself. There are also far worse opinions here than stating that paid speeches are corruption.
I've heard industry people tell of government contracts paying $300,000 a month to provide "support" for a WordPress site. They didn't get a single support request for over a year.
Nah, situations like that are not at all uncommon in software consulting. I’ve personally been involved with similar projects.
159,000/mo is 4 FTEs at typical consulting rates.
You need a DBA to manage the database, an developer to spin up some reports, someone to manage the project, and an ETL developer to get the data in and out?
There’s your $159,000/mo “database”.
Are there cheaper ways to do it? Of course. But that isn’t why anyone hires consultants.
None of those are really full time roles, especially the PM. Maybe 2 FTEs if they're not automating their own job as they go. IncRev also has an office in Bangalore where I'd assume a lot of that low-level stuff gets done, so your estimate of ~$225/hr, which is already too high for the U.S. average (but maybe not SV), could easily be too high by a factor of 3. And I doubt IncRev is really doing the report development, but maybe. So I'd guess you're off by a factor of 6 and Thernaos was just getting fleeced.
That entirely depends on the business environment. If they're allowed to work remote and the client is easy to work with, then it's not a full time job. If a client wants work to be on-site, demands a large number of meetings, and/or a lot of hoops to jump through, then that can quickly change. I've seen some business environments that expect consultant developers to attend 6 hours of meetings per day.
Some companies hire consultants precisely because their internal politics are so bad that they're unable to get the work done themselves.
I don't know anything about these companies at hand here, but I wouldn't scoff at these numbers alone.
If SV consultants charge more than $225/hr then nobody should hire them. I'm on a team of damn good full-stack developers and the most senior ones (10-15 years) bill out around $150/hr. I guarantee you we're better than most SV consultants at what we do (though we are a small team). I'm in the US, but not SV, so that must make the difference, but people are really stupid to be over-paying by "way more" than 50% for quality that I guarantee is no better than average.
There are consultants in the midwest charging $225/hr. The price that a consulting company can demand is only tangentially determined by the quality of the developers they have.
The people actually hiring these consultants usually don't care much about the skills of the individual developers. They're concerned mainly about resolving the issues that led them to hire those consultants in the first place. These often include things like:
1. Timeline. Can this consultant start work immediately? Do they have expertise in my tech stack, my industry, my regulatory environment, my particular business problem?
2. Politics. Does this consultant have sufficient reputation that I can use it as leverage in my internal business politics? Can this consultant navigate my company's business politics in order to further my business agenda? Can they produce the strategic documents/guidance to help me support my business goals?
3. Flexibility. Will this consultant work under terms that work for me? Will they put a consultant on a plane Monday? Or will they work remote? Are they willing to adjust the contract to meet a level of risk I find acceptable?
The process of choosing a consultant is mostly a business transaction between business professionals. The director of ACME's marketing department is typically in no position to evaluate the resumes of the proposed consulting development team. They're interested in getting their project done on time and on budget while minimizing risk. They're not stupid, they just have a wildly broader set of concerns than code quality.
Listen to “The Dropout” podcast, which chronicles Theranos’ rise and fall. I believe Holmes and Chandrasekaran were romantically involved in the past and were still close.
If you get money thrown at you by VC’s, why not throw and exorbitant amount to a good friend as well...
what makes is weirder is that theranos wasn't really testing. They were sending the samples to established labs. You could have maintained their test database in excel.
