ben horowitz

Traits of Great Entrepreneurs, Kimchi Problems, and Optimizing Company Culture – Ben Horowitz on The Moment with Brian Koppelman

Key Takeaways

  • You can’t say yes to what you want to do if you don’t say no to what you don’t want to do
  • “Do you believe in statistics, or do you believe in calculus? As an entrepreneur, you have to believe in calculus. You don’t believe you have an 8% chance of succeeding; you believe there’s an answer, and you’ll find it. If you don’t have that attitude, don’t start a company.”Ben Horowitz
  • Every organization should make an effort to diagnose and deal with their “kimchi problems”
  • The biggest hiring mistake companies make: hiring based on look and feel

Books Mentioned

Intro

What gets Ben out of bed in the morning? Why not retire?

  • Now that Ben’s financially successful, he has two main focuses (besides investing):
    • 1) Helping companies improve their culture
    • 2) Making companies a better place to work
  • “I can work with anyone I want to work with, and that, to me, is exciting … I can’t think of something I’d rather do. I’d rather talk with Mark Zuckerberg than lay on the beach.”Ben Horowitz
    • Ben spoke with Jay Z just the other day!
  • The possibility of learning something new or meeting someone with a unique perspective also keeps Ben fired up

How does Ben define “company culture”?

  • “Culture is how your employees and customers experience you” – Ben Horowitz

All New Ideas Are Good Ideas

  • “All new ideas are good in some way, even if you don’t like them as a business … Anybody coming in with a new idea they want to build a business around is an amazing thing.”Ben Horowitz
    • Ben says there’s one exception to this—the “this meets that” ideas
      • Why? “You have to come up with ‘this,’ not ‘this means that'” – Ben Horowitz
  • Another idea framework: Investors at Andreessen Horowitz (and really, all venture capital firms) like to think “they’re in the business of finding good ideas that look like bad ideas”

Great Entrepreneurs Find a Gap

  • “The best entrepreneurs are always working on something hard. They have some weird discovery and say, ‘Nobody knows this. I need to build a business behind it.’ They don’t say, ‘I think people will think this is a good idea,’—that’s not usually a good idea.”Ben Horowitz

How does Ben choose what to focus on?

  • He uses two frameworks (lenses):
    • First off, Ben sets overarching goals every year; if something falls into this bucket, he’ll try to prioritize it
    • Secondly, whatever he’s focusing on has to excite him
  • “It’s tricky when you have success because a lot more people want to meet you than you want to meet. If you were to take all those meetings, you’d never meet anyone you’d want to meet.” – Ben Horowitz
    • Remember: “You can’t say yes [to what you want to do] if you don’t say no [to what you don’t want to do]” 

Entrepreneurs Believe in Calculus, Not Statistics

  • “Do you believe in statistics, or do you believe in calculus? As an entrepreneur, you have to believe in calculus. You don’t believe you have an 8% chance of succeeding; you believe there’s an answer, and you’ll find it. If you don’t have that attitude, don’t start a company.” Ben Horowitz
    • (This idea comes from Ben’s book, The Hard Thing About Hard Things)
    • Brian brought a similar attitude to the table when joining forces with David Levien to write Rounders, despite having never written a screenplay in the past
    • Further: “I never think about, ‘What are the chances of succeeding?’ I think about, “How do we get the right team? How do we make the right moves?” 

Kimchi Problems

  • What are kimchi problems?
    • Problems that get hotter the deeper you bury them (the more you refuse to acknowledge them)
      • “Kimchi problems are those that get hotter and hotter until they burn down the organization” – Ben Horowitz
      • Kimchi problems are those that CEOs know exists but refuse to confront for whatever reason—they’re too busy, doing so would hurt someone’s feelings, it’d be too much work, etc.
  • To deal with kimchi problems:
    • First, separate the people from the problem
    • Second, diagnose the root cause of the problem—what happened?

Cultural Change is a Daily Affair

  • “To me, cultural change has to be a daily item. If people aren’t running into it every day, then you probably won’t change things. If they are, the culture will change fast.” – Ben Horowitz

The Biggest Hiring Mistake Companies Make

  • Hiring based on look and feel
    • For example, before hiring a head of sales, the person doing the hiring will subconsciously ask themselves, “Does this person look like a head of sales?”
  • How do you avoid hiring based on look/feel?
    • “It’s all about preparation—how you prepare for the interview. If you don’t know what you’re looking for, you’ll hire the person who looks the part.”Ben Horowitz
      • Focus specifically on what’s essential to your company. Then, hone in how you test for that (and just that).
    • Incorporate different perspectives
      • Ask other employees, “How would you hire for this position? What might you look for?”
      • (This helps create a diverse organization—way more so than trying to meet some diversity metric)
    • Ask difficult questions:
      • When hiring a CFO, ask the candidate something like, “What’s the difference between a good and great CFO?”
  • Ben adds: “If you have to hire the best, then it’s worth investing in a hiring process that can identify all the talent”

Additional Notes

  • Brian and Ben both enjoyed Kendrick Lamar’s To Pimp a Butterfly album
    • “The willingness to risk being misunderstood in order to say exactly what he wanted to say, I found incredible” – Brian Koppelman
  • “The super-geniuses—the truly brilliant people, usually have something horribly wrong with them… The people who are that brilliant often have some part of them that everybody hates.” – Ben Horowitz
  • “The worst way to cure racism is to call people racist—that creates racism.” – Ben Horowitz
  • Whenever you’re providing feedback, consider this: are you trying to make yourself feel better/morally superior, or are you trying to improve someone’s understanding of a particular issue?
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