The Hard Thing About Hard Things by Ben Horowitz
Although many people talk about how great it is to start a business, very few are honest about how difficult it is to run one. You must prepare yourself with the practical wisdom that they don’t teach you in business school.
The Hard Thing About Things
– by Ben Horowitz –
1) The ‘Struggle’ is where greatness comes from
The Struggle is when you wonder why you started the company in the first place. The Struggle is when people ask you why you don’t quit and you don’t know the answer. The Struggle is where self-doubt becomes self-hatred. The Struggle causes failure, especially if you are weak. Most people are not strong enough. Every great entrepreneur from Steve Jobs to Mark Zuckerberg went through the Struggle, so you are not alone. But that does not mean that you will make it.
2) Product strategy is your responsibility
Figuring out the right product is the innovator’s job, not the customer’s job. The customer only knows what they think they want based on their experience with the current product. The innovator can take into account everything that’s possible, but often must go against what they know to be true. As a result, innovation requires a combination of knowledge, skill, and courage.
3) Don’t take it personally
The predicament that you are in is probably all your fault. You hired the people. You made the decisions. But you knew the job was dangerous when you took it. Everybody makes mistakes. Every CEO makes thousands of mistakes. Evaluating yourself and giving yourself an ‘F’ doesn’t help. Don’t put it all on your shoulders. You won’t be able to share every burden, but share every burden that you can.
4) Share the bad news
A healthy company culture encourages people to share bad news. A company that discusses its problems freely and openly can quickly solve them. A company that covers up its problems frustrates everyone involved. Build a culture that rewards – not punishes – people for getting problems into the open where they can be solved.
5) Nobody cares about your excuses
When things go wrong in your company, nobody cares. Your investors don’t care, your board doesn’t care, and your employees don’t care. A great reason for failing won’t preserve one dollar for your investors, won’t save one employee’s job, or get you one new customer. All the mental energy you use to elaborate your misery would be far better used trying to find the one seemingly impossible way out of your current mess.
6) Take care of people before profits or products
Taking care of the people means that your company is a good place to work. Most workplaces are far from good. As organizations grow large, important work can go unnoticed, the hardest workers can get passed over by the best politicians, and bureaucratic processes can choke out the creativity and remove all the joy.
7) Don’t focus too much on the numbers
Many young companies overemphasize retention metrics and do not spend enough time going deep enough on the actual user experience. This generally results in a frantic numbers chase that does not end in a great product. It’s important to supplement a great product vision with a strong discipline around the metrics, but if you substitute metrics for product vision, you will not get what you want.
8) Hire people with the right kind of ambition
At a macro level, a company will be most successful if the senior managers optimize for the company’s success as opposed to their own personal success. As an employee, why would I want to work long hours to advance the career of my manager? If the manager cares more about his career than the company, then that’s what I’d be doing. Nothing motivates a great employee more than a mission that’s so important that it supersedes everyone’s personal ambition.
9) Hire older, experienced people
Why hire a senior person? The short answer is time. As a technology startup, from the day you start until your last breath, you will be in a furious race against time. No technology startup has a long shelf life. Even the best ideas become terrible ideas after a certain age. Hiring someone who has already done what you are trying to do can radically speed up your time to success. Hire a senior person in order to acquire knowledge and experience in a specific area.
10) Deliberately create and build around your culture
Culture does not make a company, but it’s still important. It helps you preserve your key values and makes your company a better place to work. Design a way of working that distinguishes you from competitors, without trying to be quirky or unique just for the sake of it. Articulate your mission and identify employees who will fit in with pursuing it.
11) Demand cultural compliance
It’s fine that people come from other company cultures. It’s true that some of those cultures will have properties that are superior to your own. But this is your company, your culture, and your way of doing business. Do not be intimidated by experience on this issue; stick to your guns and stick to your culture.
12) Build the foundation for great communication
Perhaps your most important operational responsibility is designing and implementing the communication architecture for your company. Absent a well-designed communication architecture, information and ideas will stagnate, and your company will degenerate into a bad place to work. One-on-one meetings especially provide an excellent mechanism for information and ideas to flow up in the organization.
13) Be direct, but not mean
Watered-down feedback can be worse than no feedback at all because it’s deceptive and confusing to the recipient. But don’t beat them up or attempt to show your superiority. Doing so will defeat your purpose because when done properly, feedback is a dialogue, not a monologue. Your goal should be for your feedback to open up rather than close down discussion. Encourage people to challenge your judgment and argue the point to conclusion.
14) Find the balance between freedom and accountability
In the technology business, you rarely know everything up front. The difference between being mediocre and magical is often the difference between letting people take creative risk and holding them too tightly accountable. Accountability is important, but it’s not the only thing that’s important.
15) Scaling a company is like scaling a product
Different sizes of companies impose different requirements on the company’s architecture. If you address those requirements too early, your company will seem heavy and sluggish. If you address those requirements too late, your company may melt down under the pressure. Be mindful of your company’s true growth rate as you add architectural components. It’s good to anticipate growth, but it’s bad to overanticipate it.
16) Courage, like character, can be developed
In life, everybody faces choices between what’s popular, easy, and wrong versus doing what’s lonely, difficult, and right. These decisions intensify when you run a company, because the consequences get magnified a thousandfold. In life and business, the excuses for making the wrong choices are always plentiful. Every time you make the hard, correct decision you become a bit more courageous and every time you make the easy, wrong decision you become a bit more cowardly.
17) You must have the right kind of ambition
One of the biggest misconceptions in our society is that a prerequisite for becoming a CEO is to be selfish, ruthless, and callous. In fact the opposite true and the reason is obvious. The first thing that any successful CEO must do is get really great people to work for them. Smart people do not want to work for people who do not have their interests in mind and in heart.
18) Learn how to lead in both peacetime and wartime
In peacetime, leaders must maximize and broaden the current opportunity. As a result, peacetime leaders employ techniques to encourage broad-based creativity and contribution across a diverse set of possible objectives. In wartime, by contrast, the company typically has a single bullet in the chamber and must, at all costs, hit the target. The company’s survival in wartime depends upon strict adherence and alignment to the mission.
19) Focus on the road, not the wall
When someone learns to drive a race car, one of the first lessons taught is that when you are going around a curve at 200 mph, do not focus on the wall; focus on the road. If you focus on the wall, you will drive right into it. If you focus on the road, you will follow the road. Running a company is like that. There are always a thousand things that can go wrong and sink the ship. If you focus too much on them, you will drive yourself nuts and likely crash your company. Focus on where you are going rather than on what you hope to avoid.