Your business is down to its last stretch but the investors aren’t putting any more cash in; advisers are telling you it may be the end. Amidst the turmoil, you decide to take the company public, displaying a facade of courage towards each banker you meet.
All that’s left to do is wait. Staring at the phone for the call that won’t come — and then it does.
Except it’s not about your company, it’s about your wife. She had just stopped breathing. The world seems to turn as everything you care about begins to slip away from your fingertips.
This is the harsh reality of building a startup, as told by veteran entrepreneur Ben Horowitz. Unlike other business books that focus on how to run a company correctly and all the sunshine and rainbows that follow after, Horowitz reveals that there is no such thing as a perfect business. Screw-ups are inevitable. The harsh reality is that being a CEO of a startup is having to be constantly backed into a corner with only two paths that lie ahead — both of which will end in some sort of a disaster. It is learning to overcome being constantly slapped by “the struggle” and the stress, psychological meltdowns, and existential crises that come after. It is being courageous enough to take a leap of faith when all you want to do is quit.
They say entrepreneurship is all about the crazy highs and catastrophic lows, and this book is a portrait filled with ugly moments and disasters. The brutal honesty Horowitz uses to describe his every hard decision and awful situation provides a real understanding of the valuable experience that is being an entrepreneur.
Based on Horowitz’s own experiences, he gives a few lessons about how to efficiently manage a startup. In line with his emphasis on approaching problems and overcoming obstacles, his key messages intend to help prospective entrepreneurs achieve the mindfulness needed to succeed.
Take care of People, Products, and Profits (in that order)
Always put the people first.
Taking care of the people is by far the most difficult one, but nonetheless, the most essential. The wrong people hinder your ability to deliver a product and without a winning product, you will not generate profits.
This means to make sure the company is a good place to work — one that inspires creativity and creates joy. Employees should wake up knowing that the work they do will make a difference, and feel fulfilled by their everyday jobs. The people must want to work there because they have confidence in the company and its mission, and not solely for the monetary values. For when things become chaotic, and they surely will, the people will stay.
Tell Things Like It Is
There is often overwhelming pressure to be overly positive in your company. Stand up to that pressure. Face your fears. Tell things like it is. Transparency is essential to create a good work environment and helps foster trust and strong communication within.
If a CEO were to insist on hiding all the setbacks and road bumps, it becomes harder for the company to jump-start the process of overcoming the problems. No matter how smart and experienced your employees are, they cannot solve a problem they don’t know about.
Peacetime to Wartime CEO’s
A peacetime CEO: thinks in the long term, acts when the business is established. Effectively follows protocols, sets goals, and minimizes conflict.
A wartime CEO: when everything goes wrong and the business needs to fend off any existential threats. Focuses on the immediate need of the company over the long term situation. Conflicts with everyone that gets in the way of the plan.
There are lots of good peacetime CEOs and good wartime CEOs, but almost no CEO can function as both. By Horowitz’s calculation, he “was a peacetime CEO for three days and wartime CEO for eight years.”
Although the content in The Hard Thing About Hard Things may not be necessarily applicable to the rest of the founders and entrepreneurs around the world, reading more about Horowitz’s experiences is definitely worth it if you want his lessons and expertise ingrained in your future approaches. Just remember to embrace the struggle — it’s the only way to succeed.