The Foolishness of Prejudice

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The Foolishness of Prejudice

by William DiPaolo

I am very hands off at Cogent Road. Sometimes (and I do realize this), it drives our team crazy. Honestly, I often struggle as I stumble along and try to learn how to lead in what others may view a very unusual manner. Yet, I press on because I am driven by an intense desire to remove prejudice from our company. Instead, I hope to create a culture in which all people see themselves without pre-conceived personal limits. As one learns to see the capacity of his own potential, he also learns to see and appreciate the wisdom of others. This is seeing others without prejudice; it is creating a culture competent and comfortable inventing software solutions for previously unsolved problems. And ultimately I hope it will make us a better software company.

The software industry as a whole is changing rapidly, though not in a good way. Software development is no longer driven by market need, but rather by venture capitalists who use financial superpowers to transform simple, easy to make software projects into billion dollar companies, regardless of the efficacy of the software itself. Consequently, if consumers find the software interesting so do the VC. And because billion dollar valuations speak “wisdom”, the technical and business press listen. And the VC software message of today is that really good, really valuable software companies sell ads.

In fact, the foolishness of this prejudice is at such an extreme that I might argue if the software industry doesn’t change it may damage our nation’s competitiveness. To illustrate we need look no further than yesterday’s announcement that Snapchat turned down a $3 BILLION ALL CASH offer from Facebook. What? Snapchat is a 30 person, two year old company that lets adolescents send photos to each other – and then automatically deletes them once they are sent. Its a simple cell phone application written by 24 year old Evan Spiegel in a just few weeks. It costs $0.00, has no revenue model, and serves no business purpose. Yet, in the prejudice of our industry, it was worth $3B. In cash. Even more shockingly the VC behind Snapchat said $3B wasn’t even enough. How can this be?

Why would a software company spend $3B for software that it could build itself in just a few months? This tells me that Facebook must not be a software company at all, but rather a media company. It views Snapchat as rival media property stealing attention from its Facebook audience. Because these companies sell advertising, they need ratings. Cloud based software companies have evolved into media companies which create applications to attract and retain an audience. This means that the top software companies in the United States are now spending billions to create and acquire software that distracts people for as long as possible.

Yikes.

It took five years to complete Roohmz Enterprise – and we did it without any outside investment. Cogent Road also has no debt. It was built slowly and deliberately by a team that understood how to build a cloud-based network to transmit complex financial data arrays through a predefined network of employees and business partners. Its functionality continually captures and analyzes loan data while the loan application moves from originator to final investor and beyond, using complex business rules to ensure loan files remain compliant. It is a new kind of data-centric networking system that will transform the way business is done, making it easier, safer and more profitable.

I hope, as we prepare for launching this complex application into the mortgage industry, that Roohmz will shine some light on the foolishness of software prejudice.

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