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Kindle Notes & Highlights
by
Reid Hoffman
Read between
May 7 - June 15, 2019
All companies are like the Ship of Theseus. Employees join, stay for one or more tours of duty, and leave, only to be replaced by new employees.
You have to walk a fine line as you evolve your culture—evolve it too slowly, and it will hold you back from adapting to new businesses and the changing world around you. Evolve it too quickly, and the Ship of Theseus illusion breaks down, and people no longer feel like they belong.
Successful organizations need a combination of conformity and diversity. The right kind of sameness (e.g., smart, driven, intelligent, hardworking, mission-driven) can give a company an edge, as was certainly the case at PayPal. But too much sameness can result in groupthink, bias, and stagnation.
Rather than hire people who “fit” your culture in superficial ways—whether based on gender or race or alma mater—hire people who are additive to your culture.
New hires are an opportunity to refine your culture and add to its capabilities. They should be compatible with your current culture but also bring elements that help change it for the better. The art is in finding transplants that the organization’s existing “immune system” doesn’t reject.
Just as start-ups incur “technical debt” by taking shortcuts with their code, they can incur “diversity debt” by taking shortcuts with their hiring practices.
Founders and CEOs are cultural role models; if they don’t exemplify the culture, it will inevitably weaken.
The never-ending need for change should fill you with both fear and hope. Fear, because you can never rest or stand still. Hope, because new markets are always emerging, giving everyone, from Silicon Valley to Shanghai (and everywhere in between), the opportunity to build nothing short of a new rocket ship.
Speed is the foundation of Zara’s “fast fashion” business strategy, which, for decades, can be summarized in a single sentence: “Give customers what they want and get it to them faster than anyone else.”
Responsive manufacturing is critical to Zara’s business model.
This focus on speed comes directly from the founder and animates the entire organization. In a 2013 profile, Fortune told the story of how, stopped at a traffic light, Ortega spotted a young motorcyclist wearing a jean jacket covered in 1970s-style patches. Ortega grabbed his cell phone, called an aide, described the jacket over the phone, and ordered the aide to get the design into production.
As with direct blitzscaling, succeeding with an M&A strategy requires having a rare or unique insight into the market;
A major issue faced by established players is that the incentives tend to favor cautious expansion rather than aggressive blitzscaling. Successful companies generally assume that they already have something valuable, which means risk taking tends to be penalized.
Jeff Bezos talked about this in one of his famed shareholder letters. Bezos wants to make sure that Amazon continues to have the start-up mindset, which he calls “Day 1.” Bezos writes, “Staying in Day 1 requires you to experiment patiently, accept failures, plant seeds, protect saplings, and double down when you see customer delight.”
One final way to mitigate the inherent pitfalls of blitzscaling within a larger organization is to treat the new initiative as a company within a company. Once your blitzscaling project is under way, you will need to manage it differently than your regular projects.
In 2008, Barack Obama won the presidency in part because his campaign was the first to leverage the distribution possibilities of the Internet, including leveraging existing grassroots networks and achieving virality via social media.
On one occasion, Xiaomi’s Lei Jun told me, “You American entrepreneurs are lazy. The vast majority of my company is still working at nine o’clock on a Saturday night.”
Rather than staying open during the standard American business hours of 9 a.m. to 5 p.m., Xiaomi operates on a “996” model—get in at 9 a.m., leave the office at 9 p.m., and work six days a week.
China also has a thing or two to teach Silicon Valley about tapping the entire talent pool. For example, China has proven an amazing environment for women entrepreneurs. Of the seventy-three women in the world who are self-made billionaires, forty-nine (over two-thirds!) live in China. Eight of the ten wealthiest self-made women in the world are Chinese.
despite China’s massive labor pool and incredible supply of technical talent, it lacks the density of Silicon Valley, and is still limited in terms of the bench strength of scale executives available to help manage blitzscaling companies.
Unlike in Silicon Valley, in China senior managers are rarely brought in from external companies, and the few that have been hired typically haven’t worked out well.
Uncertainty by itself isn’t risk; it simply produces unknowns, and unknowns aren’t inherently negative. As anyone who has ever read a mystery novel or traveled to a new city or learned a new language can attest, one of the great joys of life is the journey of discovery, of turning the unknown into the known.
Speed and uncertainty are the new stability.
The only way to thrive in this fast-changing world is to accept the inevitability of change. Use it to your advantage, whether you’re focused on your individual life or the fate of a nation.
be an infinite learner. The best and worst thing about the rapid pace of change today is that there are no experts with ten-plus years of experience in any emerging phenomenon.
Those who are willing to act—and act quickly—despite the uncertainty will have a disproportionate advantage. Seek out blitzscaling companies and markets; that’s where you’ll find the greatest growth and opportunity.
Finally, and somewhat paradoxically, be a source of stability. In a world of constant change and uncertainty, people will need reassurance and support. Offering stability and calm in the middle of the storm while others are caught in the tumult will make you a natural leader.
We believe that the future can and should be better than the past, and that it’s worth tolerating the discomfort we feel when blitzscaling to get to the future as quickly as we can.
