That anecdote came to mind recently when reading this piece in New York magazine by Benjamin Wallace profiling the troubles at Hyperloop One. [Longtime readers will remember this is not the first time we've called out New York's Hyperloop coverage.]
There is, course, another "hyperloop" company in the news. Hyperloop Transportation Technologies, but as Shervin Pishevar (venture capitalist and co-founder of Hyperloop One) told the generally credulous reporter, the other company didn't really have a serious chance of building anything of consequence.
[a] crowdsourced, volunteer-staffed company with a confusingly similar name, Hyperloop Transportation Technologies. It was perhaps not a serious long-term threat — the company was run by a former Uber driver and a former Italian MTV VJ — but Hyperloop Transportation Technologies had a few months’ head start over Hyperloop Technologies, and the amateurish nature of his rivals didn’t help Pishevar in the credibility game, which he recognized was, at this point, the entire game.
The dismissive tone might have had a bit more resonance if it hadn't been followed almost immediately by this description of how Hyperloop One prepared for its big moment in the sun
Pishevar knew the power of a well-placed media exclusive to lubricate the creation of something from nothing. In fact, he had been keeping Forbes technology editor Bruce Upbin up to date on every development of his new venture since its infancy. “Shervin mentioned the Forbes piece early, maybe even the first day I met him,” BamBrogan remembers. By early 2015, Pishevar’s company was a few steps further along, having hired a general counsel (Pishevar’s brother Afshin, who was bunking in BamBrogan’s spare bedroom) and raised $7.5 million, primarily from Pishevar’s Sherpa Capital and from Formation 8, a VC firm run by the investor Joe Lonsdale. But the company was still in BamBrogan’s garage, with no health insurance, no company insurance, no HR processes, no website, and no office space. The only thing holding it together, at this point, was Pishevar’s estimable sales skills. With a big Forbes story now slated for imminent publication, the company was in a race to acquire enough of a patina of substantiality to merit prominent coverage in America’s most famous business magazine. “It was crazy,” BamBrogan recalls. “We’re spending time finding the right industrial space that we want to grow into but also that we can do for this Forbes shoot.”
A recently hired director of operations knew the landlord of a large campus in downtown L.A., and at the end of the month, BamBrogan and his handful of colleagues moved into a sliver of the space, a 6,500-square-foot former ice factory, before they had secured a lease. With the magazine deadline looming, the skeleton crew were unrolling carpets, BamBrogan was making repeated trips to Ikea in his Audi sedan to buy 16 Vika Amon tables and 64 Vika Adil legs, and the company was buying 25 computers and 50 monitors. Some of the computers had only one graphics card and couldn’t actually run two monitors, but the superfluous equipment beefed up the apparent size of the company. The day of the shoot, BamBrogan and his co-workers scheduled a flurry of job interviews in the office so that more people would be around.
As if this weren't bad enough, the article then goes on to quote engineers for the company admitting what many of us have been saying all along: that the incredibly over-hyped demonstration was entirely limited to the parts of the technology everyone already knew worked. Rather than being a test, it was, in reality, little more than a glorified science fair exhibit.
In case I was a bit obscure in the title...
In politics and economics, a Potemkin village (also Potyomkin village, derived from the Russian: Потёмкинские деревни, Russian pronunciation: [pɐˈtʲɵmkʲɪnskʲɪɪ dʲɪˈrʲɛvnʲɪ] Potyomkinskiye derevni) is any construction (literal or figurative) built solely to deceive others into thinking that a situation is better than it really is. The term comes from stories of a fake portable village, built only to impress Empress Catherine II during her journey to Crimea in 1787. While some modern historians claim accounts of this portable village are exaggerated, the original story was that Grigory Potemkin erected the fake portable settlement along the banks of the Dnieper River in order to fool the Russian Empress.