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August 30, 2018
The Tim Ferriss Show: Drew Houston — The Billionaire Founder of Dropbox
Drew ( @DrewHouston) is the co-founder and CEO of Dropbox It was founded in 2007 It’s now used by 500 million people around the world Drew has a bachelor’s degree in electrical engineering and computer science from MIT How would Drew describe himself as a kid?
Drew grew up just outside of Boston He loved to use the computer, and was always interested in tech/computer programming His first real interest was video games Drew’s first job was babysitting In high school, he had a few computer science internships with some local startup companies “Programming and engineering were my first loves” In his high school yearbook, Drew was voted as “most likely to start a company” The M.I.T. Days
In his junior year (2004), Drew took a leave of absence to pursue a start up idea He started an online SAT prep company (called Accolade Prep) This was the year the SAT changed from a 1600, to a 2400 point scale “The more I learned about the mechanics of starting a company, the more I realized I didn’t know about business” So what did he do? – Drew bought and read the highest rated books on Amazon in the sales, business, and marketing categories Drew would also ask the founders of the various companies where he interned in high school questions that popped up Drew eventually went back to school and finished his undergrad More on Books
If Drew were teaching a freshman, or senior level college class, and had to assign books to read…? If the subject of class were starting a company… Email, Time, and OPP
OPP stands for “Other people’s problems” or “other people’s priorities” Drew has an OPP email folder which he has an assistant helps him manage To decide if something goes in the OPP folder, Drew asks himself – “Is this someone I know? Is this someone where I’d personally be helpful? Have they done their homework?” Keep the budget of your time managing OPP, small – or at least be more mindful of it “A lot of people find themselves hopelessly busy responding to other people’s to do lists, and no one is doing the things on their own to do list” Drew has a vendetta against email “You plow through hundreds of emails, and your reward is more emails” “You’re just basically checking off items on other people’s to-do lists” If you’re not careful – “You can end up in a situation where your to do list, is a composite of other people’s to-do lists” Check out the HBO documentary on Warren Buffet, which also includes some stuff on Bill Gates They were both asked, “What’s made you the most successful, in one word?” – Both said “focus” “The default for everything is to unfocus you” “There is no commandment from God that you have to respond to every email you receive” “If you get a long email, often the best response is to talk to them in person” If you get a lot of small requests, your best bet is to batch your time where you can deal with them all at once “We all think we know where our time goes, but when you actually keep track of it, you’ll likely be way off” Drew recommends keeping a log of where you spend your time Understand where your time goes, and make sure your priorities match it “Even your calendar, is often not a good representation of how you spend your time” No Meeting Wednesdays Drew has this policy at Dropbox for himself “There will never be a day where there isn’t something important from someone else coming up” Everyone will always be competing for your time Fight back – You have to set aside uninterrupted chunks of time to get your OWN imortant work done “There is a minimum quantum of time necessary for deep work to get done” – Check out the book Deep Work: Rules for Focuses Success in a Distracted World Check out The Eisenhower Matrix Limit the not important/not urgent tasks, and the urgent/not important Create time for the important/not urgent tasks The important/urgent stuff will always get taken care of Tim recommends the essay Maker’s Schedule, Manager’s Schedule by Paul Graham \ Post M.I.T.
After graduating, Drew worked as an engineer for a network security company, while still managing his SAT prep company However, he found it harder and harder to make progress with Accolade He found himself procrastinating with a bunch of side projects – he was burned out One of these projects – an online poker bot (this was 2006) “Sometimes, a lot of procrastination is unhealthy, but sometimes that voice is leading you in a much better direction” Around this time, Drew used to use a thumb drive fairly frequently to move between computers while working on Accolade He would also frequently email himself files to work on them on a different computer The whole emailing files/carrying around thumb drives, annoyed him One weekend, he decided to go visit some friends in NY, and planned to do some work on the way – but he forgot his thumb drive On the bus ride, he started writing some Python code which would eventually become Dropbox At this point, the SAT company got pushed to the side – He realized that even if everything went perfect with the SAT prep company, and he got rich….it wasn’t what he wanted out of life
Paul Graham is one of the founders of Y Combinator (YC) (a startup incubator) They were Dropbox’s first investor They also have invested in companies like Airbnb Drew applied to YC with his SAT prep company and was rejected, but got in with Dropbox In a way, the YC admissions process is very similar to the college admissions process – to get in, you have to stand out, so what did Drew do…? YC created a news site, called Hacker News (Reddit for startup news) So, Drew created a video that made it to the front page of Hacker News for multiple days He used a technique he read about in the book Guerrilla Marketing (which is about how to get attention/users for your product, with no money) It was a 3 minute screen cast of how Dropbox worked Soon after the video, Paul reached out to Drew via email, Drew told him he had applied to YC, but Paul said he needed a co-founder in order to get accepted into the program – the application period was ending in 2 weeks Drew found a friend of his in SF, who was interested, but he wanted to know what Paul Graham thought of Dropbox before agreeing to join So….Drew took a trip to SF, and crashed into Paul Graham’s office to try and show him a Dropbox demo Paul absolutely refused to see it, his reasoning: “The whole reason we have an application process is so weirdos like you don’t show up to our office and bother us, so no, please leave!” So at this point, Drew was without a co-founder, and went back to Boston Another friend in SF from MIT (the founder of Twitch), had referred Drew to Arash Ferdowski who was still a senior undergrad at MIT Drew and Arash met at MIT for two hours, and Arash dropped out to give it a go – insane! Luckily, they got into YC
The company name has always been “Dropbox” One name Drew had in mind before settling on Dropbox was “Folder Anywhere” The domain FolderAnywhere.com was available But “Files Anywhere” was also a company at the time, and Drew thought it was too similar The original domain for Dropbox was GetDropbox.com as Dropbox.com was taken The old owner of Dropbox.com didn’t want to sell it (February 2007) In September, Arash and Drew moved to San Francisco to start working on the company full time after YC The owner of Dropbox.com lived in Pleasanton, CA – so they decided to show up at his house with a $20 bottle of champagne at 9pm on a Friday He received them well, but ultimately he wouldn’t budge Once Dropbox was public, a lot of people confusingly went to Dropbox.com to get access to the Dropbox beta (around March 2008) To capitalize, the owner of the domain guy put up a Google Adwords landing page on Dropbox.com At this point, Drew and Arash considered changing the name of the company So …Drew started reading into Federal Copyright Code and Trademark Code to learn more about cyber trademark law He found that it’s illegal for someone to intentionally confuse consumers They then sued the owner of Dropbox.com for trademark infringement – which got his attention The lawsuit was dropped, and Dropbox.com was sold for $300k A cool note – Drew offered the guy stock instead at first (at the seed round evaluation), but he took the cash, which would be worth hundreds of millions of dollars today Self-Doubt
“Fortunately, the Dropbox founders are too stupid to know everyone’s already tried this” This was a quote from an article about Dropbox within the first year of the company’s life The thing is…. Drew agreed with a lot of the “haters” Drew says there were many people who had good arguments why Dropbox wouldn’t be successful (mainly that it’s been tried already, if it were possible Google or Microsoft would do it etc.) “You have to have both thick and thin skin” If you ignore all the feedback, you’ll probably miss some important information, but just because they come to those conclusions doesn’t mean they’re right Have enough thick skin to know when to be dismissive or not listen to everything Pay less attention to the outputs of people’s conclusions, and more attention to the inputs to their conclusions Many said – “Dropbox won’t be successful because people have tried it a million times” – But this would have been true for all phones before the iPhone There are a lot of bad ideas because the timing is wrong, and then the timing becomes right due to some discontinuity in tech “Just because something has failed before, doesn’t mean it will fail in the future” “I wasn’t trying to create a billion dollar company, I was trying to solve a problem” Setting your sights low in the beginning can be helpful – you won’t put as much pressure on yourself Drew also mentions how he had HUGE doubt in himself at many points along the way “Your instinct will be to run away from doubt, but you need to learn to run towards it” “The hardest part about being a CEO is managing your psychology” – From The Hard Thing About Hard Things Get comfortable being uncomfortable In Principles by Ray Dalio, he talks about how Pain+Reflection=Progress “Think of your journey more as an adventure, and less as a final exam where you have one shot and have to get everything right” Stress and Burn Out
It’s important to find ways to metabolize stress and avoid burnout “Many people just push themselves harder until they break, but you wouldn’t do that with your car or a musical instrument, so why would you do that to yourself” Tim notes that every time him and Drew are staying in the same hotel for a conference, and Tim has gone to the gym, he sees Drew “The dumbest advice people get, is that successful people work 70 or 80 hours a week, and that’s the norm” Drew doesn’t agree with this at all – “That’s usually more an indication the person has a lack of awareness about where they’re spending their time, or they lack effectiveness” “The most successful people I know have a work week that looks more normal than not” “If you can’t see your gym time on your calendar it doesn’t exist” “God gave us all weaknesses, it’s a blessing to find out about them” – Be self aware of your strengths and weaknesses Check out Enneagram – a cool assessment tool that Drew recommends “You always want to have an accurate map of what you need to work on” The Tennis Ball, A Circle, and the Number 30,000
Drew gave a commencement address for MIT in 2013, he was 30 at the time His aim for the speech – “What would I tell my 23 year old self” The tennis ball – find the thing you can become obsessed with “You will be most productive, happiest, and successful when the thing you’re obsessed with overlaps with something the world really needs or values” Don’t settle The analogy comes from Drew’s dog’s love for a tennis ball The circle “You’re the average of the 5 people you spend the most time with” “Find an environment that will pull the best out of you” 30,000 Humans live on average for 30,000 days At age 24, you’re abut 8,000 days down “The idea of life unfolding infinitely in front of you is not really true” – Make every day count Think about life as an adventure or story, not a check list – make a story that’s interesting, as opposed to trying to be perfect Wrapping Up
“Write an interesting story, not a perfect story”