When I was leading Zalora in Hong Kong, it was my first time leading a startup and I remember feeling disconcerted that I was having a lot more bad days than good days. Later on, I read Ben Horowitz’s book, The Hard Thing About Hard Things, and he wrote that in his many years leading a startup, he only had a total of 3 good days. I wish someone had told me that earlier! Anyone leading a startup or thinking of leading a startup should definitely (try to find time to) read his book. It would have been helpful to know that there were unnatural behaviors to be learned when leading a startup, and that some of the practices that made a successful corporate executive didn’t exactly make a good startup leader.
Ben Horowitz is the co-founder and partner of the leading US venture capital firm, Andreessen Horowitz. He co-founded and led Loudcloud/Opsware, which was sold to HP in 2007. His book is power-packed with insights and advice from his own war stories while leading a startup, and is definitely in my personal top 3 books read on startups and entrepreneurship. These were the 3 gems I took away from his experiences leading a startup.
1. Share every burden that you can as leader.
“Don’t put it all on your shoulders. It is easy to think that the things that bother you will upset your people more. That’s not true. The opposite is true. Nobody takes the losses harder than the person most responsible. Nobody feels it more than you. You won’t be able to share every burden, but share every burden that you can. Get the maximum number of brains on the problems even if the problems represent existential threats.”
Two things changed the most when I left investment banking to lead a startup. One, I was now actually responsible for the survival or death of the startup. If it was great, it was the team’s credit. If it was crap, I felt like it was my fault. This was never the case in my former cubicle life – no matter how stellar or inept I was, I was never able to influence the outcome of a deal. And two, instead of project-based work, I now had a neverending stream of things to improve, fix, look into, analyze, and discuss. Bankers prided themselves on being able to “multi-task”, i.e. work at hyper efficiency, sacrifice sleep, and work on 5 live deals at the same time. But at Zalora, there were a million things to do, which I realized quickly I would never be able to complete by myself. So I constantly felt responsible for every problem we had, and overwhelmed because I felt like, failing the ability to complete everything by myself, I should really have all the answers ready before involving my time-strapped and overworked team.
One time, on one of my super bad days, I took the most junior guy on the team out to lunch, and casually asked him what he thought about the two guys on our team leaving. So much responsibility rested on those two in our tiny team that I was overwhelmed by a sense of failure and fear for what we would do without them. His answer and inputs astounded me and helped me more than I expected. By the end of lunch, I had stopped blaming myself, and instead gotten constructive with the transition plan and a list of strengths and competencies I needed to hire for, which the junior guy helped in highlighting. Importantly, he helped me to realize that the move to replace these two people should have been done long ago, if it weren’t for my own insecurities as a leader and my fear of replacing incumbents who were no longer committed. I began to see it as a great opportunity to rebuild and reorganize the team into what I needed it to be – and now I had this guy to help me with it!
Startup life is so uncertain, and not just for the leaders and founders. It’s also uncertain for the team. I was scared to death that if I shared with my junior guy how terrified I was of losing these two people, he would conclude that the startup was going to pieces and that he’d better bounce. But he didn’t. He stayed with us and became one of my trusted pulses on team health. When leading a startup, give the team ownership of the success and failure of the startup by sharing the ownership of the problems.
2. Hire for strengths rather than lack of weakness.
“You hired for lack of weakness rather than for strengths. This is especially common when you run a consensus-based hiring process. The group will often find the candidate’s weaknesses, but they won’t place a high enough value on the areas where you need the executive to be a world-class performer. As a result, you hire an executive with no sharp weaknesses, but who is mediocre where you need her to be great.”
Leading a startup is overwhelming because it requires a mix of strategic and analytical skills, and also top-notch execution. And because of how competitive the market is now, for a startup to win and survive, it needs to run multiple times faster than everyone else. To do this, I needed to hire for strengths in the places that would give me the greatest leverage in execution and analytics. This included not just skills per se, but also communication skills, trust, and rapport.
When I did my first few hires, I did not appreciate this enough – institutional hiring at banks had strong emphasis on lack of weakness, but rightly so given entrenched systems and large teams. That was all I knew, and what I went by initially. It didn’t work out well. As I got more desperate for time and talent, I simply got more aggressive with hiring on specific strengths that I needed, which worked out much, much better, even if those decisions were less consensus-driven.
There’s bound to be a struggle between wanting to build a cohesive team where decisions are consensus-based, and the need to make tough hiring (and firing) decisions that are right and frankly necessary, when you are what Ben Horowitz calls a “wartime CEO” leading a startup. But I’ve found that it boils down to your own gravitas and confidence as a leader to stand by controversial decisions, which is something that takes time to build, simply because it is extremely unnatural to go against the natural human desire to be liked and to make socially acceptable decisions.
3. Focus on what you need to get right, instead of all that you did wrong.
“Perhaps the most important thing that I learned as an entrepreneur was to focus on what I needed to get right and stop worrying about all the things that I did wrong or might do wrong. By far the most difficult skill I learned as CEO was the ability to manage my own psychology.”
I have a friend in a hedge fund who always tells me: “It’s okay to get it wrong, as long as you are right more than you are wrong.” Whether in investing or leading a startup, this is really wise advice. Admit that you made a mistake, or things didn’t work out, or whatever, and then move on to get things right. It is SO important to not do “time traveling”, which is James Altucher’s term for being in the past and in the future, and not in the present, where you should be. Sometimes it is necessary to revisit those things for investors and other people for accountability, and sometimes it naturally enters your own consciousness when you experience self-doubt. But it is definitely a drain of energy to let yourself feel like a failure. So the key is to be aware of “time traveling”, and actively control only what you can control. Nobody is a born entrepreneur – there are lots of unnatural skills involved, so don’t expect to get a 98% score on it, no matter how many times you’ve scored 98% growing up. If you have any doubt about this, Ben Horowitz wants you to know that the average score for startup CEOs…is only around 22%.
Are you leading a startup? Do these points resonate with your personal experiences? I’d love to hear from you.