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April 5 - May 12, 2020
Epiphanies are rare. And when they appear in origin stories, they’re often oversimplified or just plain false. We like these tales because they align with a romantic idea about inspiration and genius. We want our Isaac Newtons to be sitting under the apple tree when the apple falls. We want Archimedes in his bathtub. But the truth is usually more complicated than that. The truth is that for every good idea, there are a thousand bad ones. And sometimes it can be hard to tell the difference.
Truths like: distrust epiphanies. The best ideas rarely come on a mountaintop in a flash of lightning. They don’t even come to you on the side of a mountain, when you’re stuck in traffic behind a sand truck. They make themselves apparent more slowly, gradually, over weeks and months. And in fact, when you finally have one, you might not realize it for a long time.
Lorraine’s reasons were much the same as the ones Christina and Te gave me at the end of that week. The tapes were too bulky to ship. There was no way to guarantee that users would ship them back. There was a high likelihood they’d get damaged in transit.
Say we buy a tape for eighty bucks and rent it for four. After postage, packaging, and handling, we’re clearing maybe a dollar per rental.” “So we have to rent something eighty times just to break even,” Te said. “Right,” Christina said. “The video stores can rent the same new release twenty-five times in a month, because they don’t have to wait for the postal service. They can just have a twenty-four-hour rental period. Plus they’re not paying for packaging or shipping, so they’re clearing more money on each rental, too.” “So we limit a rental period to two days,” I said. “Still takes at
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So he’s gone from owning 50 percent of the company to 70 percent. We’re now 70/30 partners. This didn’t bother me at all. Dilution is a normal part of the startup world. True, my share had decreased from 50 percent to 30 percent – but I’d much rather own 30 percent of a company that has money to pursue its goals than 50 percent of a company with no cash on hand.
we weren’t meeting at Hobee’s in an effort to keep our idea secret. In fact, secrecy was the least of our concerns. I’d realized by then that telling people about my idea was a good thing. The more people I told my idea to, the more I received good feedback, and the more I learned about previous failed efforts. Telling people helped me refine the idea – and it usually made people want to join the party.
What’s OPM, you might ask? Just a bit of startup slang. Other People’s Money. When entrepreneurs implore you to remember OPM, what they’re saying is: when it comes to financing your dream, use only other people’s money. Entrepreneurship is risky, and you want to ensure that the only skin you have in the game is…well, your actual skin. You’ll be dedicating your life to your idea. Let others dedicate the contents of their wallets.
“What are you waiting for?” he asked. “As soon as any of my stock vests, I sell it. There is plenty more upside if the stock keeps going up. But if it goes down, you’ll be glad you took something off the table.”
Engineers are, by necessity, literal-minded. They will do exactly what you instruct them to do. So Christina very quickly learned that she could leave nothing to chance. She began drawing the site by hand, painstakingly replicating exactly what we wanted for each and every page, along with dozens of notes in the margins about how each piece would interact with the next. Then she’d hand it over to Eric, and his team would build it. We’d look at what they’d built and make further suggestions, which they’d incorporate. Back and forth, back and forth, back and forth.
as a leader, the best way to ensure that everyone arrives at the campsite is to tell them where to go, not how to get there. Give them clear coordinates and let them figure it out.
People want to be treated like adults. They want to have a mission they believe in, a problem to solve, and space to solve it. They want to be surrounded by other adults whose abilities they respect.
Kibble had been my idea. It came from an old advertising and marketing adage: it doesn’t make a difference how good the ads are if the dogs don’t eat the dog food. The idea was that no matter how much sizzle you’d given the steak – no matter how well you’d sold it – nothing mattered if the product was lackluster. It doesn’t matter how brilliant your ad campaign for Alpo is if your dog won’t eat it.
True love, startup style. It makes me smile.
He didn’t look back – or, as he put it, he “evaluated opportunities using a regret minimization framework.”
Te would ask each new hire what his or her favorite film was. Then, the day before our monthly company-wide meeting, she’d instruct the person to come to work the next day dressed as a character from that film. The new hire would spend the day dressed as Batman or Cruella de Vil or Humphrey Bogart as Rick Blaine in Casablanca before being introduced in front of the entire company. Was this silly? Yes. Was it a waste of time? Arguably. Was it pointless? Not at all. Small, semi-improvised rituals like this kept things light. They reminded us that no matter how stressful the job was, at the end
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There’s a speaking tactic in business, useful for breaking bad news. It’s called a shit sandwich. You open up with a string of compliments, praise for work well done. That’s your first piece of bread. Once that’s done, you pile on the shit: the bad news, the less than glowing report, the things your audience doesn’t particularly enjoy hearing. You close with more bread: a blueprint for moving forward, a plan for dealing with all the shit.
Loved this, and surely will be using it up managing people :)
Not only did we get great results, but employees loved it. People who have the judgment to make decisions responsibly love having the freedom to do so. They love being trusted. But that just makes sense, right? If you fill your company with people who lack good judgment, then you have to build all kinds of guardrails to keep them in line. You have to define everything for them: how much they can spend on office supplies, how many vacation days they take, when they are expected to be at their desk.
Nobody. Knows. Anything. According to Goldman, those three words are the key to understanding everything about Hollywood. Nobody really knows how well a movie is going to do…until after it’s already done it. For instance, how is it possible that you can have a film directed by an Academy Award–winning director (Michael Cimino), starring a best-actor Academy Award winner (Christopher Walken), with a can’t-miss script and a $50 million budget…and end up with Heaven’s Gate, one of the biggest Hollywood flops of all time? On the other hand, how can you have a film with a first-time director, a
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Nobody. Knows. Anything. True with start-ups and new ideas!
Focus. It’s an entrepreneur’s secret weapon. Again and again in the Netflix story – dropping DVD sales, dropping à la carte rentals, and eventually dropping many members of the original Netflix team
Remember 80/20 rule. Remember Amazon. Remember Moz CEO Rand's focus notes. You must cut things until it hurts a bit - You must focus on things that matter the most and that means some important things won't be done.
I’d never understood what companies were thinking when they spent tens of thousands of dollars on carpeting or bought thousand-dollar Aeron chairs for every employee. Frankly, I don’t understand it even now.
It was time to seek strategic alternatives. Sound like jargon? That’s because it is. Silicon Valley is full of nonsense phrases just like it. For instance, when someone says that he’s leaving to spend more time with his family, what that really means is my ass got fired. When someone says this marketing copy just needs some wordsmithing, what they really mean is this sucks and needs to be completely rewritten. When someone says we decided to pivot, what they really mean is we fucked up, royally. And when a company decides to seek strategic alternatives, what they’re saying is we’ve got to sell
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But we knew that e-commerce was the future. If Blockbuster wanted to survive, it needed to develop an alternative to brick-and-mortar stores. If they recognized that, they might want to do what larger companies always did when faced with an upstart competitor – buy it. Eliminate the competition and save money on development, all in one fell swoop.
As noted Everest climbing guide Ed Viesturs tells his clients, “Getting to the top is optional. Getting down is mandatory.” When you’re thousands of feet in the air and miles from camp, you have to leave yourself plenty of daylight – otherwise, you can get stuck just where you don’t want to be.
RANDOLPH’S RULES FOR SUCCESS 1. Do at least 10% more than you are asked. 2. Never, ever, to anybody present as fact opinions on things you don’t know. Takes great care and discipline. 3. Be courteous and considerate always – up and down. 4. Don’t knock, don’t complain – stick to constructive, serious criticism. 5. Don’t be afraid to make decisions when you have the facts on which to make them. 6. Quantify where possible. 7. Be open-minded but skeptical. 8. Be prompt.
As you get older, if you’re at all self-aware, you learn two important things about yourself: what you like and what you’re good at. Anyone who gets to spend his day doing both of those things is a lucky man.
The most powerful step that anyone can take to turn their dreams into reality is a simple one: you just need to start. The only real way to find out if your idea is a good one is to do it. You’ll learn more in one hour of doing something than in a lifetime of thinking about it. So take that step. Build something, make something, test something, sell something. Learn for yourself if your idea is a good one. What happens if your idea doesn’t work? What happens if your test fails, if nobody orders your product or joins your club? What if sales don’t go up and customer complaints don’t go down?
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