Hard Thing About Hard Things

Executive Summary

In this week’s drop, we break down the learnings from one of our favorite books from the RBL Reading list. 

The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers" by Ben Horowitz, a renowned entrepreneur and venture capitalist.

Background

Ben is, of course, the founder with a16z alongside tech legend Marc Andreesen. So much of our thinking and approach has been inspired by them.

I have been obsessed with them for a while. The amount of knowledge they have shared in their writings and to their founders has been immense. Their firm has had venture successes with startups that have scaled, such as:

Airbnb, Meta, stripe, Coinbase, Slack, Github, Pinterest, Oculus VR, Lyft, Instacart.

(We have sent teammates to these companies and also had them as great clients)

In the early days of RBL, we were fortunate to help AgLocal, one of their portfolio companies, set up a proper performance marketing arm.

Key Learnings:

• Facing Harsh Realities: Horowitz emphasizes the importance of confronting the challenging aspects of managing a business, including handling layoffs, firing friends, and dealing with internal politics.

  • This sums up Ben’s approach to management and leadership, ensuring that priorities are right and you are focused on the right things correctly.

  • "Stay far from timid, only make moves when your heart's in it, and live the phrase ‘Sky's the limit.’" - Notorious BIG

• Importance of Leadership: The book guides being a resilient and effective leader, especially in times of crisis. Horowitz discusses how leaders can make tough decisions, navigate complex challenges, and maintain morale. The start-ups and experiences chronicled have no shortage of crisis and hard fought learnings.

  • This means, "Adversity (or crisis) does not build character; it reveals it." As James Lane Allen said, a leader’s job starts in some ways during those times.

  • “My Umi said shine your light on the world. Shine your light for the world to see.” - Mos Def

• Building and Scaling a Company: Insights into the various stages of a company's growth are given, from start-up to a fully-fledged organization. This includes advice on hiring, managing, and scaling the company structure and culture.

  Ben stresses the importance of focusing on a candidate's strengths and unique capabilities rather than just looking for someone without apparent weaknesses. This approach is particularly relevant for companies in growth phases.

  • "Started from the bottom, now we're here, started from the bottom, now my whole team here." - Drake

• War and Peace Framework: He uses a framework based on his readings of historical figures like Napoleon Bonaparte and Toussaint Louverture, relating their experiences to modern business leadership. I happen to be reading this one now: Napoleon: A Life by Andrew Roberts. Will it make the RBL Reading List? Maybe.

  • Horowitz recounts a critical period at Opsware (formerly Loudcloud) when they struggled to survive in a challenging market. He describes the drastic shift in his leadership style from being a "peacetime CEO" to a "wartime CEO." In peace, a CEO focuses on expanding the market and broadening the company's reach. In war, the CEO must focus entirely on the company's survival, often making tough, unpopular decisions. This transition was epitomized when Horowitz had to lay off a significant portion of the staff and restructure the company, a move that was crucial for Opsware's eventual success but came with heavy emotional and managerial challenges. This story is a powerful example of the adaptability and resilience required in leadership, especially in times of crisis.

  • “Survival of the fittest, only the strong survive.” - Mobb Deep

• Mental Toughness: The book emphasizes the importance of mental toughness and the ability to handle stress, loneliness, and responsibility that comes with being a CEO

  "I'm not a businessman; I'm a business, man!" - Jay Z

Summary of Big Takeaways from the book:

1. Embrace the Struggle

2. Lead by Example in Tough Times

3. Hire for Strengths to Scale

4. Build a Strong Company Culture

5. Making Hard Decisions

6. Seek Mentorship and Advice

I hope you find the thoughtful, hard-fought, candid learnings as helpful as mine. Ben lays out some key things thousands of entrepreneurs have gone through, so you might have some help along your business journey.

Best

Tye