Amr Awadallah Blog

Yahoo Homepage Before Marissa Mayer:

Yahoo Homepage After Marissa Mayer:

Congrats 🙂

— amr

I frequently find that I have to explain to candidates joining Cloudera (and existing employees) how not to be overly concerned about dilution of their percent ownership when a company is experiencing strong growth.

Towards that end I created the chart below to illustrate how percent ownership is just a small part of the total equation. The core concept is that the “paper” valuation of your stock options is equal to twice the area of your sector under the pie, and the area of your sector is proportional to your angle (i.e. your percent ownership) multiplied by the radius squared (where radius is the stock price). Hence if a startup raises a new round of funding at a large radius then that quickly out weighs any shrinkage in the angle of ownership due to the to the squaring of the stock price. I am not saying that you shouldn’t worry about dilution at all, you should obviously try to get the best deal and keep dilution low, but don’t be overly obsessed by dilution, it is just one factor in the grand scheme of things.

Fortunate startups that demonstrate repeatability/efficiency of their business model raise additional funds at a large radius so that they can fuel further growth thus making the pie larger for everyone. On the other hand startups that get overly concerned by dilution and avoid raising money (depsite being in a growth market) can fall in a penny-wise pound-foolish trap where they end up being a zombie company that goes nowhere (I know many such startups, and by the time they realize their mistake it is usually too late).

Cheers,

— amr

PS: For stock options, the “paper” value is (area of sector) minus (cost of sector), where cost of sector is angle * strike-price^2.

[There is a call to action at end of this post, please skip to it directly if you don’t have time to read]

First, I would like to start by thanking all my dear US friends for the flood of messages asking me how things are going. My mom/dad are ok, they are both 65+ so they locked themselves up at home and are glued to the TV/Internet all day long. That said, they are *very happy* with what is going on, they are no longer oppressed, they are no longer afraid.

Two weeks ago I wouldn’t have had the courage to write what I am about to say, but this revolution in Egypt changed me in the same way that it changed Egyptians across the globe. See, we Egyptians have been bred to be scared of the ruling regime and never question them (this probably goes back thousands of years to Pharaohs era). While growing up in Egypt I was taught that if we speak up against the ruling regime then we will disappear into an undisclosed “dark room”, we’ll get whipped, our nails will be pulled out, wild dogs will rip our flesh off, and we might never return. Generation after generation was taught that lesson, and the government controlled media re-enforced that message in full force.

I came to the US in 1995, and at that time I was actually very happy and grateful for the 25 years I had lived in Egypt. My goal was to get my EE PhD from Stanford University then head back to Egypt to teach. It took about one year for me to start seeing the liberties people enjoy in the US, the lack of fear from being “excessively” oppressed, and the realization that the ruling regime is supposed to be working for us, *not* the other way around. I then felt betrayed that for all this time I was lied to and cheated, there is a better way to live out there, I didn’t have to live in such fear all these years. However, unlike the current heroes in Egypt, I choose the easy way out; I choose to make the US my home. In 2009 I got my US citizenship, so I am now an Egyptian American, and I hold citizenships with both countries. I am loyal to both countries, but more importantly, I am now loyal to freedom and justice of people across the world.

The sad part is, despite being a US citizen, I was still afraid to write or stand up against the ruling regime in Egypt. I was afraid that if I do so then next time I visit Egypt to see my parents I will be pulled to the aforementioned dark room, or they’ll get back at me by pulling my dad/mom instead. However, two weeks ago, when the Jan 25 revolution started, that changed overnight. Don’t ask me how or why, but that is what happened to me and many other Egyptians across the world. It was a spark that lifted the fear and awakened all of us. My dad took a bit longer to change though, understandably so, he endured many more years of conditioning and brain washing. I remember calling him in the first week of revolution, and when I would ask him what he thought about Mubarak he would divert the question and say “so how are the kids doing?”. He was still afraid of saying something bad about Mubarak lest phone lines are wiretapped, which is a very common practice in Egypt. Now the amazing thing is on the second week of protests, in which Mubarak cavalry killed many Egyptians but the peaceful demonstrations continued regardless, the wall of fear collapsed for my dad and *everybody* in Egypt (there is a minority that still supports Mubarak, but that is because they are benefiting from the regime). When I call my dad now he says everything in his heart, he isn’t afraid anymore, it is amazing (and hopefully this last sentence won’t get him in trouble). IMHO the fall of fear is actually the most important thing achieved by this revolution; it is the seed that will cause everything else to happen. It is because of this that I think Egypt is now on the right path, there will be a bit more turmoil, but things will get better.

Now that I have the courage to write against ruling regimes, I need to direct *strong* criticism to the US government. First, they knew about these atrocities/brutality, they knew that Mubarak was an oppressing tyrant, they knew that he controlled the Egyptians with fear, but they wanted him there, because he listened to them and did what they asked for (or believed the lies he told them about radicals, more on that later). But even if we were to assume that the US government didn’t know that the people were being terrorized (which I find very hard to believe), now they know for a fact that this is the case (see the many links at end of this post). Many say the US shouldn’t intervene in this matter; it is for the Egyptians to resolve. I agree with that, however, the US helped Mubarak stay there, so if we have any shred of decency left in US then we should at least undo our interference and back his removal now (it is our chance to smoothly bring around democracy in Egypt without raging a bloody expensive war like Iraq).

I will tell you outright that Mubarak is purposely lying to the US government by elevating the threat of radical Islamists to scare us into believing that they are causing this revolution to take over power (which is scary, I agree). However, this is absolutely *not* true, this revolution is by a new generation of youth whom the ruling regime couldn’t encapsulate in fear like previous generations. These youth had access to non-Egyptian censored media and were able to see how freedom tastes like in the rest of the world. When I came to US in 1995 the satellite broadcasting revolution was just starting in Egypt. This was a very pivotal point, since it allowed people to see media which isn’t controlled by the government. Then the Internet and mobile communications waves started in 2000 which allowed them to have virtual meetings to discuss, talk, and organize (anybody who participated in political gatherings in Egypt had the risk of being pulled into the dark room). Obama, a black man, being elected as president was also part of that taste, his marvelous Egypt speech in 2009 further emphasized that strong message of freedom and democracy. Anyway, the key message is that this revolution is by the people for the people, it isn’t by the radical Islamists whom are a minor fraction of the Egyptian population. If you watched the 8 million people who demonstrated last Friday (Feb 4th, aka Departure Friday), they broke into song and dance after finishing their prayers [http://youtu.be/ahCwBBndlVY], radical Islamists hate song and dance. Furthermore the crowd had women mixed with men, side by side [http://youtu.be/HErSVpn7vA8], another sign that radicals were a small part of this. Last, but not least, the Christians (about 15% of Egypt’s population) did their prayers before the Muslims, and then they proceeded to make a human chain to protect the Muslims while they were praying [http://bit.ly/hHfCS4]. It is a very diverse group; it isn’t the radicals at all.

Mubarak’s message to the US of “you need me in power to keep your interests safe” is 100% false, it is FUD [http://bit.ly/ejziyB] so the US keeps him in power. It is similar to the FUD he is creating internally, he pulled the police forces from the streets then unleashed goons to terrorize and steal so he can tell the people “you need me in power so I can keep you safe”. What a bunch of baloney. I can understand and sympathize with how some simple folks in Egypt can fall for that FUD (many did), but to see the US falling for it too is just unbearable. BTW, his latest trick is that the current Egyptian constitution doesn’t allow him to leave, he has to serve the rest of his period (yes, the 30 years period) then handoff the power to newly elected president in September. That is actually true, the constitution does say that, but only because he changed it to ensure so. The constitution was changed before and can be changed again. The people are saying we don’t want this, the people make up the constitution, not the president who is supposed to abide by it.

In conclusion, not unlike the 1789 French revolution asked for “Liberty, Equality, Fraternity”, the Egyptian people are asking for “Bread, Liberty, and Human Dignity”. They are asking for Mubarak to step down *now* since trust is completely broken, he came on TV one day “promising” that he will leave in September then the next day his cavalry rammed into the protestors. I would say that stepping down isn’t enough, he should be prosecuted for the fear/oppression he planted in our hearts for all these years, and the billions he stole should be returned to the poor people who deserve it (or to the US who paid it at the first place). To the heroes of Jan25 I say thank you from the bottom of my heart for lifting the veil of fear, and to the brave ones still camping in Liberation Square I say “no retreat, no surrender”.

Finally, if you care about liberty then I urge you to tweet the following: @BarackObama: Mubarak Out *Now*, and stop financial aid to tyrants #egypt #jan25 (please RT). If you don’t have a twitter account then please email it to the White House using this form: http://www.whitehouse.gov/contact. If you are so inclined, you can also signup for the virtual “March of Millions” on Facebook: http://on.fb.me/i5ye8e. Other ways to help at: http://seda.me

Thanks,

— amr (twitter: @awadallah)
http://www.awadallah.com

PS: I paste below a number of links with some of the key videos/photos from the events of the last two weeks:

* Peaceful unarmed protestor gets shot in Alexandria
http://www.youtube.com/watch?v=1OlmTWpcmvk#t=119s

* Diplomatic car runs over at least 20 people, just like they’re zombies!
http://www.youtube.com/watch?v=_cWOK0Lfh7w

* Another peaceful civilian gets sniped
http://www.youtube.com/watch?v=4XnhHzs91MY

* Fire truck runs over and flattens a protestor
http://www.youtube.com/watch?v=4QgLrBp47a8

* Police APC truck runs through a group of protestors
http://www.youtube.com/watch?v=RgwvCxS2nDw#t=50s

* Brave protestor stands up against police APC with mounted water canon
http://www.youtube.com/watch?v=FgxH93oSGn0#t=81s

* Dramatic video as thousands clash with Egypt riot police
http://www.youtube.com/watch?v=3xWiBCIxjIk

* Police against protestors on Anger Friday (Jan 28)
http://www.youtube.com/watch?v=dBtYLBQPRGQ

* Mona Seif talks from inside Liberation Square on night it was attacked
http://www.youtube.com/watch?v=LSBJwsjakcg

* Shahira Amin on why she quit Egypt State TV due to false propaganda
http://www.youtube.com/watch?v=1pZl8yVwkn0

* Rachel Maddow on how reporters were being attacked in Egypt
http://www.youtube.com/watch?v=QeD9B3b4xzs

* Interview with Miral at Liberation (Tahrir) Square
http://www.youtube.com/watch?v=RtLJpzUp2Z8

* Asmaa Mahfouz, one of the first youtube videos that started the revolution
http://www.youtube.com/watch?v=eBg7O48vhLY

* 2min video compilation with highlights from the revolution:
http://www.youtube.com/watch?v=ThvBJMzmSZI

* 9min video compilation with highlights from the revolution:
http://www.youtube.com/watch?v=-HGfFyqJMrk

* Wealth that Mubarak family accumulated ($40B to $70B, yes B for Billion)
http://www.youtube.com/watch?v=Il-36NXye2c

* Wael Ghonim (Head of Marketing for Google Middle East) was taken to the dark room (he is still there till now)
http://nyti.ms/fo7JI7

* Misc photos from the revolution
http://blogs.sacbee.com/photos/2011/01/rioting-and-chaos-engulfs-egyp.html

* Photos for some of those who died during this revolution (at least the ones we know of)
http://1000memories.com/egypt