"Gentlemen of the Hooli board, and lady," CEO Gavin Belson opens a meeting to discuss Hooli's botched livestream. "To the ignorant or those in conventional industries, the recent Nucleus glitch may seem like a failure. But we in this Valley all know that failures just like this one are really stepping stones. What those in dying business sectors call failure, we in tech know to be pre-greatness." At that moment, "FAILURE = SUCCESS" appears on the presentation screen.
With examples of prominent tech flubs that preceded big successes, including an odd mention of Digg's Kevin Rose (odd because Digg isn't that big a success), Belson's point isn't lost on those outside the tech world looking in. Many sit back in bafflement while company after company proceeds to "fail up." But the Hooli Board isn't hearing it, so to win them back he asks that they "Imagine... a function so game-changing that its integration into Nucleus will justify any miscue in the platform’s roll-out.” Cut to him issuing the same statement, this time as a plea, to the Hooli XYZ team. “Seriously! Imagine it, and do it quickly!" Unfortunately with Big Head in charge, he only gets a broken potato cannon and a fanciful idea that, says Big Head, could arrive in their lifetime.
Meanwhile, Pied Piper investor and idiot clown person Russ Hanneman gets some bad news. We assume he's financially ruined, since he says as much and we find him comatose under a blanket near a pile of dog shit in his house. But in fact the gag is that he's just sunk below the billion mark, leaving him out of the "Three Comma Club" and looking to get some value out of Pied Piper as soon as possible by asking them to pivot to a sales model. What happened to being pre-revenue?
The next interlude is a business lesson on "go-to-market" strategy. As we learned at the end of the last episode, the team that stole some of Pied Piper's middle-out algorithm has founded a competitor called End Frame. Or rather, as hotshot lawyer Ron LaFlamme points out, Pied Piper handed the algorithm to End Frame in a pitch meeting honeypot Erlich referred to as "a classic brain rape." With no legal recourse, Richard and company burst in to End Frame's fancy Financial District offices with vague plants to confront them. Reaming them out in a conference room, Richard scoffs at their algorithm on a whiteboard and his team needs to stop him from correcting it, spilling the rest of their secrets. Yet the End Frame guys don't care that their tech is worse than Pied Pipers. Why? They'e got a massive sales team and deals lined up, including one with online porn purveyor Intersite. Later, Hanneman even suggests that Richard merge with End Frame in what would basically be an acquisition. Pied Piper is at another crossroads, which is either realistic of an early stage tech company, an unfortunate error of over-plotting, or both.
It's time, then, for Pied Piper to walk the "left-hand path," as the team's resident satanist Gilfoyle explains his unorthodox plan of action. No, this isn't the first time he's saved his fellows with a heretical plan, and yes, the turn is becoming predictable. This time Gilfoyle has stolen access to End Frame's accounts, granting them details of the Intersite deal. With better software, they come to realize that Pied Piper could save Intersite money, and if they point that out, they might snag the $15 million offered to End Frame.
How can Intersite shell out so much cash, Richard wonders? The show posits that porn accounts for 37% of all internet traffic at any given time. “38 percent if I’m on it,” Erlich adds. But that number is way off the mark. Only about 4% of the top million websites are for porn, or at least they were about five years ago according to Forbes, though 13% of web queries were porn-related. Richard eventually consents to the "crazy illegal" plan to steal the deal based on insider knowledge of its terms. Monica is more skeptical: “Okay, I was not in the room when this happened!”
Also running through the episode is a "Dinesh does Tinder" subplot. He's met a woman named Karen, and he's fabricating elaborate life details and escapades to impress her. "She's practically not my species," he deprecates himself, "I'm a guppy and i'm trying to mate with a dolphin." Erlich's sage advice for wooing women? Put on some “Early Sade...before her arrangements became too baroque." When Karen does meet Dinesh IRL, she's "outed by Wi-Fi," as in her phone connects to the house's wireless network to reveal that she's been there before. It turns out that Karen once had a relationship with Erlich and was just using Dinesh to get back to him. Cue the early Sade!
Back to the main plot line, Richard heads to a porn tech conference to get in a word with Intersite's CEO. It's a good opportunity for porn-tech jokes with its furiously whirring sex toys. Cutting around the room to the conference attendees, we see all kinds of raunchy domain names written on innocuous placeholders. Those include but are not limited to "Poop On My Wife" and "Blackmailed Into Gay." Hey, I just write the recaps.
When Richard finally gets ahold of Intersite's CEO, he puts his foot directly in his mouth. "I am data compression — I mean..." But she recognizes Richard, saying "You're the CEO." Richard is unduly gratified because Erlich is always mistaken for CEO. "Yes, uh thank you!" he swoons as if accepting high praise. Though the Intersite CEO is skeptical — how does he know the details of the deal? — she's willing to hear him out, eventually challenging Pied Piper and End Frame to a bake off. Whoever can show they've got what it takes will get the $15 million in porn money.
Silicon Valley, wrote former Valleywag stone-thrower Sam Biddle earlier this season is becoming a "documentary" about the milieu it depicts. He meant that as a compliment, but I would say that depends. At its best moments — and this episode included just a couple of them — the show is a mockumentary. You know, a kind of This Is Spinal Tap with a tech company instead of a band. But unfortunately, instead of Sam Biddle writing the digs at tech that were his specialty, we've got Dan Lyons working on the script. Biddle's replacement at Valleywag, Lyons didn't last long at Gawker despite his chops as a Steve Jobs jester. This week I'm thinking that Silicon valley, whether by association or actual influence, has a bit of his staleness. Still, the show is about climax, and I'm looking forward to a strong season finale at CES.
Previously: Silicon Valley Recap: Kool-Aid