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The Hard Thing About Hard Things

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Executive Summary This is a book about Ben Horowitz S War Stories Horowitz s war stories Horowitz has good war stories if you care about the narrow space of Venture Backed fast growth technology startups I m not so sure that they generalize to the point of making a good management guide You might be better off eading some DruckerFirst the absolute preliminaries Ben Horowitz co founded LoudCloud with Marc Andreessen in 1999 with a plan to do enterprise managed services what has now grown to the SaaS and IaaS space They were technological pioneers in that space They weathered the dot com bubble burst but it was touch and Go Since Most Of Their Clients Were since most of their clients were tech firms going bankrupt They IPOd in a post bubble environment with a declining market They pivoted to become Opsware a tech services firm ie further up in the backend of the managed services stack They pivoted as a public corporation close to bankruptcy which is a nightmare I wouldn t wish on my worst enemies They weathered NASDA delisting threats mass employee evolts the whole Mad Max scenario So he offers the prospect of excellent data from the inside Ben also has a eputation in the valley as a no bullshit guy so this is valuableSecond some initial thoughts To the extent that Ben s stories will generalize they only apply to fast growth venture backed tech startups that plan to IPO It bears epeating that this is but one subset of the technology space the subset that gets a disproportionately large amount of press coverage and fanfare So much of the lessons are the kind that you ve probably already osmosed from the Paul GrahamPeter ThielA360ZAVC crowd And if you haven t then you should probably start with Paul Graham and Peter Thiel ather than jumping into this book which has a narrower scope and doesn t make much effort to make clear the context That s okay since it s aimed at the specific crowd but just be aware if you e not of that crowd and thinking of eading this bookBen tells the story from the technical CEO perspective which is a fairly are perspective to get given the depth of Ben s experience Note that Paul Graham only walked the walk through a 50 million dollar acuisition and never faced the challenges of being the CEO of a publicly traded corporation Peter Thiel did but is ultimately a non technical founder Besides the PayPal mafia is fairly cagey about the war stories around PayPal given the extent of the internal fights eg the ouster of Elon Musk from CEO that they want to cover up Much of the other available writings are from the VC perspective and lack founder experience Thus this book does give us an opportunity to ead the thoughts of a founder CEO all the way through and beyond the IPO stage But it is by no means a masterpiece that stands alone It does offer an incremental view if you are primarily interested in the narrow niche of venture backed startups and serves as a 4 star or 5 star book of anecdotes that have potentially generalizable lessons if ead critically while fully aware of the appropriate broader context That s a big asterisk though So I will attempt to summarize the core lessons that I personally got out of the books given that I am not solely interested in this space1 Being CEO in a fast growth venture startup euires learning at an incredible pace The job description changes almost completely within 6 months given the growth ate There isn t any way to get that experience except networking with founders who have previous lived experience as founder CEOs of large companies This is why for example Zuckerberg had long walks with Jobs A top notch VC firm will definitely help you get that which is why they are so valuable The otating board circuit in the top Silicon Valley firms will provide this if you can get them to sit on your board Horowitz for example holds Bill Campbell s advice in particularly high esteem You probably can t unless Seuioa Founders Fund Andreessen Horowitz or KPCB is backing you2 At the end of the day you have to make incredibly complex strategic decisions with extremely limited information which creates crazy stressful environments3 To Ben s credit he does focus on good management but mostly doesn t add anything new to the corpus It s mostly the usual good stuff don t do arbitrary things don t publicly shame people don t let people get away with enriching themselves at the company s expense through strong arming don t do short term things that jeopardize the long term and if you do it will apidly become the culture and will A lot of people talk about how great it is to start a business but only Ben Horowitz is brutally honest about how hard it is to un oneIn The Hard Thing About Hard Things Ben Horowitz cofounder of Andreessen Horowitz and one of Silicon Valley's most espected and experienced entrepreneurs draws on his own story of founding unning selling buying managing and investing in technology companies to offer essential advice and practical wisdom for navigating the toughest problems business schools don't cover His blog has garnered a devoted following of millions of eaders who have come to ely on him to help them un their businesses A lifelong ap ,
Emain permanently broken Again a decent coverage of the standard Literature Covers Space literature covers this space Being CEO is a lonely job You cannot expect your executive team to understand all your decisions given their job You cannot expect your executive team to understand all your decisions given their scope You also cannot spend the time to give them the broader scope all the time since that takes away from doing their own jobs But if you don t they might stop trusting you It s Catch 22s all the way down5 In addition while the CEO mentor network can help with your emotions they can t help you with the decisions since it will take them weeks to get up to speed on the context You e eally on your own on these decisions6 It s also emotionally harder when your final decision is 5545 and you e facing opposition from underlingsyour board that is 9010 the other way but lack the appropriate context So you e on the fence leaning one way but others are convinced that you e wrong At this point you should just learn to trust yourself since you e the only one with the appropriate context Your board should be experienced than you so they should be aware of this information asymmetry Conseuentially they ll usually just ubberstamp what you decide anyway This doesn t make the decisions any easier to make7 You absolutely need to develop decision making processes that are insulated from your own emotional ollercoasterinsecurity Ben likes writing things down until the words are convincing on their own I do too Whatever your methods are you will absolutely need to ely on them since you e going to be alone in the decision making processes and need some check to make sure you e operating logically with no emotional biases So develop those early I personally ecommend the LessWrong corpus but you might find that too kooky Your choice8 Ben Horowitz eally likes ap and hiphop That s not my thing but whatever I can espect his artistic side Anyone who criticizes him for that aspect of his personality is eally missing the pointContext that Ben Horowitz did not mention that I think would have greatly improved the book1 The tides are turning and the days when Venture Capitalists could oust founder CEOs and eplace them with adults are permanently gone Zuckerberg and the fact that founders like Horowitz and Thiel now lead top Valley VC firms has permanently changed the landscape So a lot of the fighting that Ben had to do and the perpetual underconfidence that he did it with won t apply to future founder CEOs This book adds to the growing corpus that helps make your case to not be ousted which partially obsoletes that aspect of lessons in the book Ironic I know2 Fast growth tech startups that have a distinctive tech advantage can win despite terribly dysfunctional management When you e in a greenfield technology space you can do whatever you want and still win just from the tech advantage For example Valve gets cited a lot for it s no management structure but they sit on a giant money spigot called Steam that just prints money If I also owned such an oil derrick I could probably get away with mandatory sex parties every Thursday This doesn t make the case for workplace orgies3 There is great talk about how Ben escued OpsWare from near disaster through their final acuisition by HP for 165 billion dollars But there is not a single mention of how OpsWare fared post acuisition For all I know and given the next point I suspect this was a shitty deal for HP4 It doesn t help that Ben Horowitz heavily aided the OpsWare executive team to form the core team at his next venture the VC firm Andreessen Horowitz That can t have been good for OpsWare at all5 Ben talks about how you eally need your executive team to hit the ground unning You can cover for one executive to get them up to speed but you can t cover for every executive Thus you need to hire top tier talent often from outside This is great But this also forms a good explanation for why top executives often seem to be from a different planet move in completely different circles and get paid orders of magnitude But Ben doesn t cover any of these pathologies or how it eally is a necessary side effect of the ealities of the executive esponsibilities6 From Ben s aiding of his previous form for top executive talent I get an increasing suspicion that the top talent moves in tight knit teams that gel well together Your management priority should be to network and form these connections from an early stage definitely before you found your own VC backed fast growth startup If you do. An Horowitz amplifies business lessons with lyrics from his favorite songs and tells it straight about everything from firing friends to poaching competitors from cultivating and sustaining a CEO mentality to knowing the ight time to cash inHis advice is grounded in anecdotes from his own hard earned ise from cofounding the early cloud service provider Loudcloud to building the phenomenally successful Andreessen Horowitz venture capital firm both with fellow tech superstar Marc Andreessen inventor of Mosaic the Internet's first popular Web browser This is no polished victory lap; he analyzes issues with no easy answers through his trials incl. N t have this focus you HAVE TO DEVELOP IT AT A to develop it at a
stage in the 
in the and for that you eally need top VCs otherwise you will not be plugged in at all and have no access to these folk I haven t ead many any books that are written by CEO s for CEO s If you are a CEO aspire to be a CEO or eally manage anyone you need to ead this book This uote is perhaps my favorite one from the book At the top nobody is there to tell you what to do It s easy to look at some leaders and wonder how they knew what to do to become so successful Are they just eally smart The truth is that they to become so successful Are they just eally smart The truth is that they did what everyone else in that situation has to do get scrappy and just figure it out and don t give upGreat CEOs face the pain They deal with the sleepless nights the cold sweats and what my friend the great Alfred Chuang legendary cofounder and CEO of BEA Systems calls the torture Whenever I meet a successful CEO I ask them how they did it Mediocre CEOs point to their brilliant strategic moves or their intuitive business sense or a variety of other self congratulatory explanations The great CEOs tend to be emarkably consistent in their answers They all say I didn t uit My second favorite uote from the book speaks to one of the greatest challenges all entrepreneurs face worklife balance I like to say work hard play hard But sometimes it s easy to forget the play part Or to buy flowers once in a while But the cost of those on your health or elationships can cost much As a company grows communication becomes its biggest challenge If the employees fundamentally trust the CEO then communication will be vastly efficient than if they don tBen had a lot of great advice on how to hire well especially executives Looking to avoid eactionary big company execs when you need someone who will come in and get stuff done proactively Looking for people who can think on their feet and not make everything a nail for the hammer of their prior experience by asking How will your new job differ from your current one Looking for people who are mission driven and use the team prism instead of the me prism He also had advice about onboarding and trainingHiring for strength instead of lack of weakness I ve definitely seen instances of this where a candidate is great in some areas that we eally need but isn t great at everything Knowing what you value most is critical here and I fully admit not easy to doI d learned the hard way that when hiring executives one should follow Colin Powell s instructions and hire for strength ather than lack of weaknessOn hiring internally vs externally Internal candidates across often do better which is a great thing to think about when building a team when it comes to CEO succession internal candidates dramatically outperform external candidates The core eason is knowledge Knowledge of technology prior decisions culture personnel and tends to be far difficult I can t take insights from someone who has so little insight about himself Cases in point As a white boy you do not have to call yourself the Jackie Robinson of barbecue You can just say you are good at barbecuing Or say nothing eally because it s irrelevant That fact that your grandfather once WENT to a black neighborhood is not a story Seriously you should not tell people that because IT S NOT A STORY The fact that you bullied your wife into going on her first date with you is kind of a story but it doesn t eflect well on you I wish I could get past these things because Horowitz undoubtedly know much about business than I do But no I m out This is not a book that I think many general eaders would enjoy The first part is about the author s experiences building and unning various tech companies and is fairly interesting Most of it though is a huge compendium of short bits of management advice that gets very tedious It might be of interest if I were looking for a how to book but even so it seems to be based pretty heavily on the author s own experience ie I did this I was successful Ergo this is the ight thing to do I suppose that is better than taking advice from a failure but I would prefer than one sample pointI ead it based on a positive mention in The Economist I guess they are better at commentary than book ecommendations It s hard for me give this a ating as I haven t eally ead many other how to business books I liked the narrative section at the beginning of the book a bit better than the tactical advice section but I think that s probably just how I prefer to get. Udingdemoting or firing a loyal friend;whether you should incorporate titles and promotions and how to handle them;if it's OK to hire people from your friend's company;how to manage your own psychology while the whole company is elying on you;what to do when smart people are bad employees;why Andreessen Horowitz prefers founder CEOs and how to become one;whether you should sell your company and how to do itFilled with Horowitz's trademark humor and straight talk and drawing from his personal and often humbling experiences The Hard Thing About Hard Things is invaluable for veteran entrepreneurs as well as those aspiring to their own new venture. ,

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