BusinessWeek cover story under attack

BusinessWeek’s latest cover story, about a new brat pack of young entrepreneurs in Silicon Valley, is being criticized by virtually everyone.

Former BusinessWeek reporter Gary Weiss, author of “Wall Street vs. America,” noted on his blog Friday that “Here’s the odd thing: the skepticism lacking in the story is actually right there at BW — just not in or near the article.

“In a BW Online blog, Rob Hof offers a dissenting voice: ‘As I’ve told Sarah [the author of the story], I’m still a little uncertain how different things really are now in the Valley. For every brash entrepreneur who can afford to blow off VCs, there are 100 more who would give their left, uh, knee to get a few mil for their startups.’

“It would have been nice if these countervailing sentiments were reflected in the article, or as an accompanying “sidebar,” and not stuck away in an online story comparatively few people will read.”

Meanwhile, Salon co-founder Scott Rosenberg blasts the headline on the cover, noting that the $60 million figure for Digg founder Kevin Rose is something pulled out of the air.

Rosenberg wrote, “Was it something that some irresponsible coverline writer had slapped on the piece, that the responsible writer was horrified to see? I don’t think so. The second paragraph of the article, referring to a recent redesign of the Digg site, reads: ‘At 29, Rose was on his way either to a cool $60 million or to total failure.’

“The $60 million number is never explained in the piece; the only real numbers are contained in this sentence: ‘So far, Digg is breaking even on an estimated $3 million annually in revenues. Nonetheless, people in the know say Digg is easily worth $200 million.’ Elsewhere the article says Rose owns 30 to 40 percent of the company. Hence, $60 million.

“There is a word for this kind of business journalism, and it is: awful. The reader has no idea who these ‘people in the know’ are; they could easily be people associated with the company who have an interest in inflating its worth.”

Meanwhile, the web site TechDirt has its own criticism of the story: “Suffice to say, BusinessWeek has written the ultimate Web2.0 hype piece without the slightest hint of skepticism about the numbers that it throws around. Digg very well may be sold at some point, and Kevin and the other Digg staff may make out very well. However, to suggest that they already have is pure bubble logic. Yeah, we’ve got some serious deja vu.”

Read more here.