00:00So I'm going to talk about how
to operate.
00:01So I've watched some of the
prior classes, and
00:03I'm going to assume that
you've already sort of
00:05hired a bunch of horrendously
resourceful people.
00:07That you've built a product
that at
00:08least some people love.
00:09And you're probably raised
some capital.
00:11And now you're trying to build
a company.
00:12So you're, you're enforging a
product and
00:14now you have to forge a
company.
00:15And it actually argue for
00:16GM company is much more
difficult than for
00:19Basic reason is people are
irrational.
00:20So you probably all know this
either your parents,
00:23your significant other or your
brother or sister, or
00:25your teacher, somebody in your
life is irrational.
00:27Building a company is
basically taking all
00:28the irrational people you
know, putting them in one
00:30building and then living with
them 12 hours a day at least.
00:33So, it's very challenging.
00:34Now, there's techniques for
coping with that and
00:36some people get good at it and
small people don't but
00:38that's where really what
operating is about.
00:41So basically what you're doing
when you build a company is
00:43you're building an engine.
00:45And at first you have a
drawing literally on a white
00:48board, and you're architecting
it, and it
00:50looks very conceptually clean,
and beautiful, and pretty.
00:54But when you start actually
translating to
00:56practice actually it looks
more like this, and
00:58you're holding it together
with duct tape.
00:59And it takes a lot of heroic
effort to people to
01:01actually hold it together.
01:03That's why people work 80, 100
hours a week,
01:05is that heroic effort is
actually necessary to keep
01:07this thing together.
01:08Because you don't actually yet
have polished metal in place.
01:12want to construct a high
performance machine.
01:14A machine that actually almost
nobody really has to
01:17worry about every hour.
01:18Every minute and you know as
we
01:20used to joke about Ebay that
if Martians took over Ebay it
01:23would take like six months for
the world to notice.
01:25That's what eventually what
you want to get to.
01:27Or as Warren Buffet says, you
know, build a company that
01:29idiots could run because
eventually they will.
01:31So this is what you want
basically a performance
01:36machine that idiots can run.
01:38Now, as a leader, what is your
real job?
01:41Strictly speaking there's only
one book that's ever written
01:43that actually explains how to
do this, it's a little old.
01:45It was written in 1992 by Andy
Grove,
01:47who's quite famous, quite
successful, and
01:49his definition of what your
job is,
01:50is to maximize the output of
an organization,
01:52your organization that you're
responsible for, CEOs,
01:55everything and a VP would be
part of the organization.
01:58And the organizations around
you, so if you're VPE,
02:00you're actually are
responsible for
02:02the performance of the product
team too, or
02:04the marketing team, because
you have influence there.
02:06So this is how measure people
and you want to focus on
02:10the output not the input the
old adage about measuring,
02:13not measuring motion and
confusing that will progress,
02:15you're measuring only
progress.
02:17And this is going to sound
like a fancy and
02:19glamorous thing to do.
02:21Maybe people get excited about
managing a whole
02:23large organization, and being
responsible for the output.
02:26But in practice, what you're
going to learn today hopefully
02:28is that it's more about things
like ordering smoothies,
02:31teaching your receptionist how
to answer the phone properly,
02:33and serving as a $10 an hour
task rabbit for
02:37So let's talk about that.
02:39So at first when you
02:40start a company everything's
going to feel like a mess.
02:42And it really should if you
have too much process,
02:44too much predictability you're
probably not
02:46innovating fast enough and
creatively enough.
02:49So it should feel like
everyday there's a new
02:51problem and what you're doing
is fundamentally triaging.
02:55So some things will look like
a problem, and
02:57they're actually a colds,
they're just going to go away.
02:59So, somebody's annoyed about
this or that.
03:01That may be a cold, and you
shouldn't stress about it,
03:03and you certainly shouldn't
allocated a lot of
03:05And some things are going to
present themselves as colds.
03:08But just like in the emergency
room, if they're not
03:10diagnosed properly they
actually can become fatal.
03:12So what I'm going to try to do
is help give you
03:14frameworks for thinking about
which things are colds and
03:16which things are potentially
fatal.
03:20So one of the most important
things I've learned at
03:21Square is actually a concept
of editing.
03:24I think the best metaphor I've
ever seen in like 14 years of
03:27running stuff of how to think
about your job.
03:30It's natural, it's a natural
metaphor so
03:32it's easy to take with you
every day.
03:33And actually it's easy to
transmit to each of
03:36your employees so that they
can figure out
03:37wether they are editing or
writing.
03:39It's a natural construct.
03:40You generally know when
someone asks you to
03:43Am I more writing or am I more
editing?
03:44So an editor, as, is the best
metaphor for your job,
03:48and we're talking about the
specific things you're doing
03:52The first thing an editor
does, and
03:54you probably all had this
experience in school,
03:55is you submit a paper to a TA,
a draft to your friend.
03:58And the first thing an editor
does is
03:59they take out a red pen or
nowadays, you know online, and
04:02they start striking things.
04:04Basically eliminating things.
04:05The most important task as an
editor is to simplify,
04:08simplify, and that usually
means omitting things.
04:10So that's your job too, is to
clarify and simplify for
04:14everybody on your team,
04:15the more you simplify the
better people will perform.
04:17People cannot understand and
04:19keep track of a complicated
set of initiatives.
04:21So you've got to distill it
down to one, two, or
04:25And use a framework that they
can repeat,
04:26they can repeat without
thinking about,
04:28they can repeat to their
friends,
04:29they can repeat at night.
04:32Don't except the excuse of
complexity.
04:33A lot of people will tell you
that well this is
04:35too challenging, this is too
complicated.
04:36Well yeah, I know other people
simplify but
04:39This is a complicated
business.
04:41You can change the world, in
140 characters.
04:48You can build the most
important companies in
04:50history in a very simple to
describe concept.
04:53You can market products in
less than about 50 characters.
04:59There's no reason why you
05:00can't build your company the
same way.
05:01So force yourself to simplify
every initiative,
05:04every product, every
marketing, every,
05:07And, and basically take out
that red,
05:09and start eliminating stuff.
05:12Second thing is, what editors
do,
05:13is they ask you clarifying
questions.
05:15So when you present a paper to
somebody,
05:16what do they usually do?
05:17Do they, find some ambiguity
somewhere and
05:20they say, well did you really
mean this, do you mean that,
05:21do you have an example of
this?
05:22That's what your job is, so
you're in a meeting and
05:25people are going to look to
you, and the real thing you
05:27do is you actually ask a lot
of questions.
05:29And they can be simple, basic
questions like,
05:32should we try this seven days
a week or six days?
05:36They can be fundamental
questions like,
05:39where's our competitive
advantage here?
05:41We try to this actually as
investors too
05:44some investors will ask you a
billion questions about
05:46a billion things and they'll
have you do diligence forever.
05:49We try to narrow it down to
what are one, two or
05:52three four things that
actually matter for
05:53this company and only focus on
those things.
05:56So it allows us to be more
decisive, and
05:58we can make decisions rapidly.
06:00It allows us not to distract
you from your day job,
06:03which is actually building a
company.
06:04And yet, I think we still get
to the higher fide,
06:07highest fidelity answers.
06:08We don't have all these extra,
06:09extraneous details, pieces of
data.
06:11Now it's hard, it's something
you have to practice, but
06:13when you're good at it, every
step you eliminate, Andy Grove
06:16estimated that you can improve
performance by 30-50%.
06:20The next thing you do is
allocate resources.
06:22So the editing construct,
06:24this is what editors do all
the time.
06:25They take editors from the
mid-East and
06:28covering the mid-East and they
move them to Silicon Valley,
06:30because Silicon Valley is now,
now more interesting.
06:32Or they move them to a sports
section because they want to
06:34compete on the basis of sports
with other journals and
06:37So that can be top down where
I take a bunch of,
06:39allocate resources and
06:40people would say, we're now
going over here,
06:42we're going to compete on this
basis.
06:43And then next month, next
quarter, next year,
06:46that Middle East coverage is
getting boring and bland.
06:48We don't want to do that
anymore.
06:49Let's go chase after something
else, or it can be bottom up,
06:52just like journalists mostly
come up
06:53with their own stories, the
people who work with you.
06:56Generally should be coming up
with their own initiatives.
06:59So, a reporter will generally,
who covers Google, come up
07:02with the interesting stories
that they're hearing in
07:04aether, and propose one or two
to their editor for approval.
07:07But it's not like the editor
is saying, go cover Google,
07:09and this is the angle I want.
07:10Once in a while they do that,
but
07:12that's not the date, the day,
the meat and
07:13potatoes of what a journalist
does every day.
07:16Your goal over time is to
actually use less red
07:20So one way of measuring how
well you're doing in
07:23your colleagues about what's
important and what's not.
07:25What, why some things are
important,
07:27some things are not,
07:28is how much red ink you're
pulling out every day.
07:30It's okay if you have a bad
day and
07:31the red inks all over the
place.
07:33But it's not okay if the red
ink next month is
07:34more is more than it was last
month,
07:36if the next quarter is more
than this.
07:37So measure yourself of how
much red ink you're creating.
07:41The other thing that's very
important that actually isn't
07:44as intuitive to a lot of
people is,
07:46the job of an editor is to
ensure consistent voice.
07:49So if any of you read The
Economist,
07:50you can tell that there's one
consistent voice.
07:53You can pick up any article,
any post in The Economist, and
07:56if feels like it's written by
the same person.
07:58Ideally your company should
feel like,
07:59on your website and your PR
release,
08:01on your packaging, if it's a
physical product.
08:03Anywhere on your recruiting
pages to feel like it
08:05was written by one person.
08:07That's extremely difficult to
do,
08:08and first you're going to be
tempted to do
08:10that yourself which is okay
for a founder to that.
08:13Him or herself initially.
08:15Over time you do not want to
be doing all of
08:17the consistent voice editing
by yourself.
08:19You are a trained people so
08:21that they can recognize the
differences in voice.
08:22So if you see this website
page it
08:24looks very different than the
recruiting page.
08:26You start by asking questions
why is that?
08:28Is the reporting messed up?
08:29Is the leaders over here not
08:30really understanding the voice
of the company?
08:32So, you've gotta, you have to
fix that over time.
08:35But you want to start with the
objective of
08:36everything should feel exactly
the same.
08:39It's quite, quite difficult in
practice.
08:41Almost every company has at
least one piece
08:43of the organization that isn't
exactly on the same voice.
08:46At Apple, which is notorious,
you know,
08:47even under Steve's regime,
which was notorious for
08:51If you asked someone who
worked at Apple, talk,
08:53asked them about the internal
tools about recruiting.
08:56Do they really feel like Apple
products?
08:57All of them will tell you no.
08:58So you're never 100%,
09:00but you definitely want to get
a close to that as you can.
09:03Next complicated topic is
delegating.
09:06So just like the other thing I
09:07like about the metaphor of
editing is.
09:10Writers do most of the work in
the world.
09:12Editors are not actually
writing most of the content in
09:16So that's actually true of
your company.
09:18You are not going to do most
of the work.
09:19You shouldn't be doing most of
the work.
09:21And the way you get out of
doing most of
09:23the work is you actually
delegate.
09:24Now the problem with
delegating is,
09:27that actually you're
responsible for everything.
09:29So as CEO founder there is no
excuse,
09:31there's no like that's that
department over there,
09:33this person over there screwed
up,
09:35you're always responsible for
09:36every single thing, especially
when things go wrong.
09:39So how do you both delegate
but not abdicate.
09:41It's pretty tricky challenge
and
09:43both are sins, like if you
over delegate.
09:45Or, and you advocate, or
09:47you micro-manage, those are
both sins.
09:49So I'm going to give you a
couple techniques for
09:54First, this actually comes
from high output management
09:56and to grow, is what's known
as task-relevant maturity.
09:59It's kind of a fancy phrase
for
10:01basically, has this person
ever done this before?
10:04And how mature is this person
in doing something/ And
10:06the more they've done the
exact same task before.
10:08The more sort of rope you're
going to give them.
10:10And the less, the more they're
trying something new,
10:13the more you're going to
actually instruct them and
10:15consistently, constantly
regularly monitor.
10:17So that's kind of a basic
concept but
10:19it's worth keeping in the back
of your brain.
10:21The interesting implication,
and
10:23this is pretty radical, is
that any executive,
10:26any CEO should not have one
management style.
10:29Your management style actually
needs to be dictated by
10:32So with one particular person,
you may be very much a micro
10:35manager because they're quite
low on this scale.
10:38And with another person you
may be delegating a lot
10:40because they're actually quite
mature on this scale.
10:43So it's actually a good thing
if you do reference checks on
10:45somebody, and half the people
you call say they're a micro
10:47manager, and the other half
say they actually give me
10:49a lot of responsibility,
that's actually not a,
10:51that's a, that's a feature not
a bug.
10:53I didn't understand that at
first, at all, like I used to
10:55be befuddled when people would
dereference checks on me, and
10:58come back with this like,
complicated mosaic.
11:01And that basically, finally
figured out that maybe I
11:03was actually doing my job
correctly, and so
11:06thought other people that this
was the way to do it.
11:08A more nuanced answer though,
that I've sort of came up
11:12with, is how, how do you make
decisions?
11:14And delegating versus doing it
yourself.
11:17You don't want to do it
yourself too often.
11:19So what I've basically
borrowed from Peter,
11:21this is my first two by two
matrix ever in my life but he
11:25taught me something at least
is you basically sort you,
11:28your own level conviction
about a decision on a grid you
11:31know, extremely high,
extremely low.
11:33There's times when you know
something's a mistake, and
11:35there's times where you
wouldn't do it that way, but
11:37you have no real idea what
the, whether,
11:39whether it's the right or
wrong answer.
11:41And then there's a consequence
to mention, there are things
11:43that if you make the wrong
decision are actually
11:45catastrophic to your company
and you will fail.
11:47There are things that are
pretty low impact,
11:50that really at the end of the
day aren't going to
11:52make a big difference, at
least initially.
11:54So what I basically believe is
that where there's low
11:59you have very a low confidence
in your own opinion, you
12:02should absolutely delegate,
and delegate completely like
12:04people make mistakes and
learn.
12:06On the other side obviously,
12:08where the consequences are
extremely dramatic and
12:10you have extremely high
conviction that you're right,
12:13you actually can't let your
junior colleague,
12:16like, make a mistake.
12:17You're ultimately responsible
for that mistake, and if
12:19it's really important you just
can't allow that to happen.
12:22Now the best way to do
12:23that is to actually explain
your thinking, the why.
12:26It's easy to shortcut when you
get busy,
12:27explaining why's of the world,
but it's very important to try
12:31when I was at LinkedIn I had a
colleague who's quite,
12:36Both occasion we get annoyed
if, if I didn't exactly agree
12:40with his opinion on something,
and so I'd
12:42spent a lot of time trying to
persuade him why I was making
12:45a decision a certain way.
12:47And his wildcard, the card he
would ultimately call out if I
12:49didn't quite persuade him,
12:50he's like, okay you're the
boss, and that meant to
12:53me like I was burning a lot of
social capital.
12:55Every time he said that, I
knew I was like
12:57really creating a thin line,
and that ultimately that was
13:00going to backfire if I did
that too often, so
13:01you want to track the times
that you're doing that.
13:04Example of this is Squares,
13:05one of my favorite people in
the world,
13:06and my second hire, first
marketing hire had this
13:09program he wanted to run
called Inner-Square,
13:11which basically allowed people
to give out square merchants
13:15to get out ten other squares
to their call.
13:17Just imagine a food truck
outside,
13:19put like ten squares on the
counter and
13:21people could just grab them,
and Kyle had this great idea,
13:24this would be this awesome
marketing program.
13:26Squares would spread squares
to other people and, you know,
13:31to some extent it was on
brand, so
13:33it didn't have catastrophic
consequences.
13:35Each of these ten squares
didn't cost that much money,
13:38so financially we could afford
to do it.
13:40But, at that time my ten years
of experience said
13:42there's just no way this is
going to work in
13:43a meaningful enough scale, to
move our metrics enough and
13:47I actually would prefer we
don't, not do this.
13:50excited about this that I
decided to just let him do it.
13:54He learned that actually when
you
13:55measure this thing it's not
massive.
13:57It doesn't create a massive
value for the company.
13:59It did require a fair amount
of operational complexity to
14:01ship all these squares to
people and
14:03figure out how to get them to
be squares etc.
14:05But it allowed him to be
excited about his job and
14:08to learn how to filter future
ideas, so it's totally worth
14:11letting him make the quote
unquote mistake.
14:15The next and most possibly
most important thing you do
14:18is actually edit the team.
14:20So these are the people that
you work with, and
14:21nobody's going to have a
perfect team and
14:23you're certainly not going to
start that way.
14:25So would, I'm going to try to
do is
14:29maximize the probability for
success in editing the team.
14:32So I like this idea of Barrels
and Ammunition.
14:34Most companies once they get
into hiring mode as
14:36Sam pointed out you should
defer that for awhile, but
14:39once you do they just hire a
lot of people.
14:40And they're like, you expect,
and
14:42you expected as you add people
your throughput,
14:45your velocity of shipping
things is going to increase.
14:48It turns out it doesn't work
that way.
14:50Usually when you hire more
engineers you
14:51actually don't get that much
more done,
14:53you actually sometimes get
less done.
14:55You hire more designers,
14:56you definitely don't get more
done,
14:57you get less done per day we
could talk about why.
15:01But so the reason why is that
most people,
15:04most great people even, are
actually ammunition.
15:07But what you need in your
company are barrels, and
15:09you can only shoot through the
number of
15:10unique barrels you have.
15:12So that's how the velocity of
your company improves is by
15:15adding barrels, and then you
stock them with ammunition,
15:18and then you can do a lot.
15:19So if you go from a one barrel
company,
15:21which is mostly how you start.
15:22To two barrel companies
suddenly you get twice as many
15:25things done per day, per week,
per quarter, and if you go to
15:27three barrels, great, if you
go to four barrels, awesome.
15:29Barrels are incredibly
difficult to find,
15:31but when you have them, like
give them lots of equity,
15:35promote them, take them to
dinner every week because it,
15:38it, they're virtually it like
irreplaceable.
15:41Because they're also very
culturally specific.
15:43So a barrel at one company may
not be a barrel at
15:45another company because one of
the ways in the definition of
15:48a barrel is they can take an
idea from inception
15:51all the way through shipping
and bring people with them.
15:53And that's a very culturally
specific opportunity specific
15:58So two questions probably are
occurring to you,
16:00is how do you figure out who's
a barrel and who's not?
16:03One is you start actually with
a very small set of
16:07It can be fairly trivial.
16:08It can be something like, I
want to reward
16:11the engineers that are in my
office at 9 o'clock at
16:13night every night with an ice
cold fresh smoothie.
16:16This is actually a real
example.
16:18I was frustrated our engineers
were
16:20working really hard at square.
16:22maybe 20% to 30% would stay
very late into evening, and
16:24I wanted to serve, we were
ready to serve them dinner but
16:27I wanted to give them
something cool to reward them,
16:29and you could think about
alcohol, but
16:31that's a little complicated.
16:32So smoothies were probably a
little bit
16:34better than the pizza, which
drains you of energy.
16:37But nobody could get smoothies
in my office to show up at 9
16:40o'clock sharp that were cold,
that tasted good and delivered
16:43in the right place that
engineers would find them.
16:45You'd think this is simple,
but
16:46in fact, it like, took months
to get this right.
16:49So then we had an in, we had
an intern start, and
16:51I think on his second day,
16:52I was explaining this problem
and
16:53he, he said, well, I'll do it,
and I was like looking at and
16:56I'm like there's no way.
16:57I've seen my office manager
fail, my assistant fail,
16:59all who are actually pretty
good.
17:01This just isn't going to
happen, and then long and
17:03behold that night they show up
on time, cold, delivered to
17:07the right place, and my first
instinct was great not,
17:09not, nothing about the
smoothies.
17:11But okay, now I can actually
give you something more
17:14important and inconsequential
and complicated to do, and
17:16that's what you actually want
to do with every
17:18single employee every single
day is expand the scope of
17:21their responsibilities until
it breaks and it will break.
17:24Everybody like, I couldn't run
the world, like everybody has
17:27like some level of complexity
that they can handle, and
17:29what you want to do is keep
expanding it until you see
17:32where it breaks and that's the
role that they should stay in,
17:34that level of sophistication.
17:36But some people will surprise
you,
17:37there will be people who you
don't expect without,
17:40with different backgrounds,
without a lot of experience
17:42that just can handle
enormously complicated tasks,
17:45and so keep testing that and
pushing the envelope.
17:47The other signal to look for
17:49is once you've hired someone
is this,
17:51with an open office just watch
who goes up to other people's
17:53desks, particularly people
that they don't report to.
17:56If people start going to your
desk,
17:58someone individual employee's
desk and
18:00they don't report to them.
18:01It's a sign that they believe
that,
18:02that person can help them.
18:04So if you see that
consistently,
18:05those are your barrels.
18:07give them more opportunity as
fast as you can.
18:12The other question everybody
asks about people is,
18:14when do you hire somebody
above somebody?
18:16And when do you sort of mentor
somebody or
18:18when do you need to replace
somebody?
18:19And the way, the way to think
about this is
18:21every company has its own
growth rate and
18:23every individual has its own
growth rate.
18:24So some companies that are
very successful,
18:27LinkedIn was always a very
linear company,
18:30it never went like this.
18:31So for example I joined
LinkedIn 18 months after we
18:34launched and we had only 1.5
million users which in
18:37a social product is very small
in number and
18:39when I joined I was the 27th
employee.
18:42a half years later we only had
57 employees.
18:46In contrast when I joined
Square as a 20th employee,
18:49two and a half years later, we
had like 250,300 employees.
18:53So each company has it's own
velocity on this curve, and
18:56if the company's going like
this,
18:57you can only keep people in
the roles that their own
19:00personal learning curve is
going like this.
19:02On the other hand, if the
company's growing like this,
19:04anybody whose learning curve
is faster than that,
19:06you can keep giving them the
same role to do.
19:09So always track like the
individual slope of,
19:11of an employee, and the
company's growth rate.
19:15Now you have your barrels
identified, so
19:18you're pick out the people
that can really take an idea
19:20that you have in the back of
your head scope it out,
19:22run with it, make it happen,
ship it,
19:24and it's perfect, where do you
aim these barrels?
19:27So I'm going to argue that you
really need to spend a lot of
19:30time focusing people.
19:32This is something I've learned
from Peter Thiel, actually.
19:34He used to insist the PayPal,
that every single person could
19:37only do exactly one thing and
we all rebelled.
19:40Every single person in the
company rebelled to this idea.
19:42Because it's so unnatural,
it's so different than every
19:45other company where people
want to do multiple things,
19:47and especially as you get more
senior you want to definitely
19:49want to do multiple things,
and you're, you're like,
19:51you feel like insulting to be
asked to do just one thing,
19:53and Peter would enforce this
pretty strictly.
19:55He'd basically say I will not
talk to you about anything
19:58else except this one thing
I've assigned to you.
20:00I don't want to hear about how
great you're doing over here.
20:02Like just shut up, and peer
would run away and
20:05then focus until you conquer
this one problem, and
20:09the insight behind this is
that most people will
20:12solve problems that they
understand how to solve.
20:15Roughly speaking, they will
solve B
20:17plus problems instead of A
plus problems.
20:19A plus problems are high
impact problems for
20:21your company, but they're
difficult.
20:22You don't wake up in the
morning with a solution, so
20:24you tend to procrastinate
them.
20:26So imagine you wake up in the
morning,
20:27you create a list of things to
do today.
20:29There's usually the A plus 1
at the top of the list but
20:31you never get around to it,
and so
20:33you solve the second and
third, and over
20:35an entire company of hundreds
of people that just cascades.
20:38So you have a company that's
always solving B plus things.
20:40Which does mean you grow and
does mean you add value.
20:42But you never really create
that breakthrough idea because
20:44no one is spending 100% of
their time banging their head
20:47against the wall every day
until they solve it.
20:49So I highly recommend some
version of that.
20:51You can be less stringent.
20:52You can be like you can get.
20:54Three things to work on, but
there, I would still track at
20:57least the concept of what
would happen if you only gave
21:00everybody one thing to
prioritize.
21:05Now, because you can't make
decisions, you don't want be
21:09making all these decisions
yourself, you have to
21:11create tools that enable
people to make decisions.
21:14At the same level ideally of
fidelity that you would make
21:17So how do you create scale and
leverage?
21:20First, thing I'd recommend is
building a dashboard.
21:22This is an old square
dashboard.
21:23It actually looks pretty
presentable even today.
21:27The construct of a dashboard,
first of all,
21:30should be drafted by a
founder.
21:32You need to basically simplify
the value proposition in
21:35the company's metrics for
success on a whiteboard.
21:38You can have other people
build the dashboard,
21:40I don't actually care about
that, but
21:41you need to draw it out.
21:42Like what does business
success look, look to us and
21:45what are the key inputs to
those, and then
21:47have someone create something
that is very intuitive for
21:50every single person in
21:51the company including customer
support to use.
21:54the key metric of whether
you've succeeded is what
21:57fraction of your employees use
that dashboard every day.
22:01If it's actually useful it
should be close to 100%.
22:04It's not going to be probably
100%,
22:05but you want to measure that.
22:07Just like you have quality
scores for
22:08all your other KPIs with
users,
22:10the dashboard needs to be as
intuitive as it is
22:13as your product is for users.
22:17Other things, wait, hold on.
22:19Yeah, let's go back, one
second.
22:21Another concept is
transparency.
22:22And people will often.
22:27Transparency, people talk a
lot about.
22:30It's kind of a goal that
everybody ascribes to, but
22:34shove very few people actually
adhere to it.
22:36So let me walk through a
little bit of transparency and
22:38different stages of
transparency.
22:41Metrics are the first step.
22:43So everybody in your company
absolutely should have
22:45access to every single thing
that's going on.
22:47Other things that I like to do
are take your board decks, and
22:50as you get more formal, the
board decks will get
22:52more complicated, and actually
review every single slide with
22:55every single employee after
the board meeting.
22:58You can strip out the
compensation information if
23:01But every other slide you
should go
23:02through with the entire
employee base and explain it.
23:05And if you can remember some
of the feedback you
23:06got from your board that's
really cool to pass on.
23:09Another thing we did at
Square,
23:10as your company skills,
23:11everybody's not going to get
invited to every meeting, but
23:13they want to go to every
meeting.
23:15The way you scale that is you
create notes for
23:17every meeting and you send it
to the entire company.
23:19So we created a notes at alias
for
23:22every single meeting involving
more than two people,
23:24someone would write notes and
send it to the entire company.
23:27So people felt like as the
company added employees,
23:29they could continue to monitor
and
23:30track what was interesting,
what was going on,
23:32and they never felt excluded,
hopefully.
23:35like even the details around
conference rooms.
23:37Every conference room at
Square has glass walls,
23:40because as soon as you have
regular walls,
23:42people wonder what's going on.
23:43It's amazing, like if they can
see who's actually in
23:45the meeting, and who's meeting
with who and when.
23:48They don't worry nearly as
much as
23:49what's going on behind those
closed doors.
23:52Stripe, you may have seen a
blog post, but I
23:53think Patrick wrote it, about
email transparency, about
23:56actually allowing everybody to
have access to email.
23:59That's pretty far out there
but
24:00it's actually got interesting,
you know,
24:02certain merits to it.
24:03I would all call the tactics
that you read about
24:05here about as sort of minimal
viable transparency.
24:07I actually think you could
push the envelope a lot more.
24:10Steve Jobs tried this at Next.
24:11He actually tried transparent
compensation.
24:13I actually think, although
Next didn't do extremely well,
24:17the real reason wasn't because
of the experiment around
24:20compensation transparency and
24:22then there's a lot of error to
that.
24:24The critique of compensation
transparency is often well.
24:27We want people to be teammates
and
24:28work together and collaborate.
24:30And if you look in the sports
world, though,
24:32where people are actually
teammates and
24:33they do have to collaborate,
24:35all of their compensation is
completely public.
24:37In fact, each of us can look
up anybody's compensation in
24:39the sports world and
24:40get it exactly accurate, and
somehow it seems to work.
24:42So I'm not totally bought in
24:44to the idea that you need to
keep transpar-,
24:46compensation non transparent.
24:49Then finally metrics.
24:50So you want to measure things.
24:53You want to measure outputs,
not inputs.
24:55And again, you should dictate
this yourself.
24:56You should draft the dashboard
to tie this all together.
24:59One important concept are what
are known as
25:01pairing metrics or pairing
indicators,
25:03which is if you measure one
thing and only one thing.
25:05The company tends to optimize
to that, and often at
25:07the expense of something else
that's important.
25:09A costly example in payments
and
25:11financial service is around
risk.
25:13It's really easy to give the
risk team an objective and
25:15say, we want to lower our
fraud rate.
25:18Until they start treating
every single user in
25:20this audience as a suspect
user because they
25:22want to lower their fog rate.
25:23So they require each of you to
call them up on the phone and
25:26give them more supplemental
information and
25:28you have the lowest fraud rate
in the world,
25:30you also have the worst, you
know,
25:31sort of customer satisfaction
score.
25:33So what you want to measure at
the same time as
25:34your fraud rate is your false
positive rate.
25:36That forces the team to
actually innovate.
25:39can give recruiters metrics
around hiring, and guess what?
25:42You'll have a lot of people
come in through interviews,
25:44but if you're not tracking the
quality of hires,
25:46you may be very unhappy with
the quality of people you're
25:48interviewing or the people
you're giving offers to.
25:50So, you always want to create
the opposite as
25:52an indication and measure
both, and the people that
25:54are responsible for that team,
need to be measured for both.
25:58Finally around metrics, one
insight I've had over my
26:03career is what you, you kind
of want to look for
26:07You don't actually want to
look for
26:08the expected behavior.
26:10So that a famous example was
at PayPal.
26:14None of the top ten markets
that
26:15the company was planning to go
after included eBay.
26:19But one day, someone noticed
that 54 Power Sellers had
26:22actually handwritten into
their eBay listings,
26:25please pay me with PayPal, and
brought this to
26:28the attention of the executive
team at the time.
26:30The first reaction of the
executive team was,
26:32what the hell's going on?
26:33Let's kick them out of the
system.
26:34That's not our focus.
26:36Fortunately, I think David
Sacks came back the next day
26:39said, I think we found our
market.
26:40Let's actually build tools for
these power sellers instead of
26:43forcing them to write into
their listing,
26:46Why don't we have an HTML
button that they can
26:48Well that started to work.
26:50well actually why do we make
them insert it.
26:52Why should we make them insert
it all the time?
26:54automatically insert it for
them?
26:56So they could just insert it
once and
26:57then every single listing they
have forever.
26:59It'll just automagically
appear there.
27:01So that became the success for
PayPal.
27:03Similarly, I was at LinkedIn,
27:05and I saw this stat that made
no sense to me.
27:07The UI for the site was a
little bit different back
27:09then, but 25% of all clicks,
maybe 30% of all clicks
27:12from the home page were people
going to their own profile.
27:16And that made no sense
whatsoever.
27:18I mean like, the set, it was a
settings,
27:19like you had to literally go
to the right margin.
27:21Final a link and it was 25 to
30% of every single click at
27:25scale I mean so this is like
statistically novel stuff.
27:28And it made no sense
whatsoever,
27:29never seen like the UI perform
that way.
27:32And, I kind of went around for
weeks trying to
27:35figure this out and then
someone very smart.
27:37Actually, it's Max Letchin
said something to me and
27:39I was like, he's like it's
vanity.
27:42And I'm like ha people
27:44are looking at themselves in
the mirror.
27:46That's pretty good answer.
27:47So cause they weren't editing
their profile.
27:49Nobody has like something to
edit everyday in
27:52But they actually were just
looking in themselves in
27:53the mirror everyday because it
made them feel good.
27:54And then you can actually test
that hypothesis and
27:56say, well, if I had more
content.
27:58Do I look at myself in the
mirror more often?
28:00If you had more endorsements,
28:01did you look at yourself in
the mirror more often?
28:03So, we actually figured out
like
28:04what was actually underneath
utilitarian product that
28:08the product team thought they
were
28:09building was actually a lot of
emotional vanity.
28:11They didn't exactly translate
it to the best possible
28:14feature, like the PayPal
example,
28:15which you couldn't easily put
a button that,
28:17said be more vain today, you
know, on the homepage.
28:19>> That would probably not
work perfectly, so it
28:21never really like took off the
way the PayPal example did.
28:23But it clarified what the user
what users of
28:26the product really wanted and
28:28we wouldn't have found that
without looking for
28:30The final topic I want to talk
about is details.
28:33And there's, in my assigned
reading,
28:36there's a great book I really
like by BIll Walsh called,
28:39The Score Takes Care of
Itself.
28:41And the basic point of the
book is that if
28:44you get all the details right,
you don't worry about how to
28:48build a billion dollar
business,
28:49how to have $100 million of
revenue,
28:51how to have a billion users.
28:53That's a byproduct of getting
all the details of what you
28:56do everyday to be excellent.
28:57So the example he talks about
in the book that really
28:59resonated with me was he took
over the 49ers in 1979.
29:03They were the worst team in
football.
29:05I believe they were 2 and 14
the year before,
29:06which is really bad for this,
if you don't know football.
29:09In the next ten years, he
managed to transform the team
29:12into the NFL's best, won three
Super Bowls.
29:15And what's the first thing he
did to start going from
29:18a terrible team to the best
team ever in many ways?
29:22He actually taught the
receptionists how to
29:24answer the phone properly.
29:25He wrote a three-page memo
about how to
29:27actually answer the phone.
29:28Now, that may sound absurd.
29:30But his point was, if the
organization as a whole
29:33does everything exactly the
right way, then receivers, for
29:36example, will start running
their routes at
29:38seven-and-a-half yards, not
seven yards, not eight yards.
29:41And that actually will matter.
29:43And then everybody on the team
executes exactly up to
29:45the same standard of
performance.
29:47You will have an organization
that is performing at
29:49the highest possible level,
and
29:51then with enough random
variation, the highest
29:53possible performance team will
do the best.
29:55So the way you translate this
to a company are to
29:58a lotta details that may not
matter.
30:00They may not seem that they
matter superficially.
30:02Most people would agree about
the details matter when it
30:06But where the real debate is
on
30:07things that don't face the
user.
30:09So Steve Jobs famously in the
Mac,
30:11insisted on an immaculate
circuit design board.
30:13You can read about this in
various books.
30:15The Mac, for those of you who
don't remember the Mac,
30:17probably everybody here but
30:18some of you may have seen it,
actually couldn't be opened.
30:20So the circuit board design
couldn't be
30:22seen by any single person in
the world.
30:24There was no way to open the
Mac except the people who
30:26worked at Apple, and Steve
insisted that it be
30:28absolutely perfect and
beautiful.
30:30That's the kind of detail
obsession that this sort of
30:32philosophy of building a
company requires.
30:35Examples that maybe more
practical for you instead of
30:37circuit boards are things like
what food do you serve people.
30:41This actually matters more
than you might guess.
30:44When people don't like the
food you serve them,
30:48They go complain to their
friends.
30:49They go walk over to someone's
desk.
30:50And all the sudden at lunch,
30:51what they're complaining about
is, it,
30:53their mostly spending time
gossiping and
30:55complaining instead of
brainstorming.
30:57So you don't have this
serendipitous idea.
31:00Not saying other serendipitous
idea that creates a spark,
31:02instead they're all wandering
and wallowing around.
31:04So the best thing you could do
is actually give
31:06people the food they want or
food that's good for them.
31:08That makes them more
productive.
31:09So it may seem a lot like this
glorious job
31:11that you thought you had is
actually more like
31:14running around being a task
rabbit for people.
31:17take the things off the plate
that are a distraction.
31:20So that they can be
high-performance machines.
31:22And if you take enough things
away from people that distract
31:25them and give them the tools
to be successful, all of
31:27a sudden your organization
produces a lot more.
31:29Similarly, another example
that's often got wrong is
31:33So, one natural instinct is
when you need an office is to
31:36have an office manager or
31:37someone on your team go out
and find offices.
31:39And they'll go on tours with
agents and
31:41they'll come back with photos
and ideas.
31:43You need to do that yourself.
31:45The office environment that
people live in and
31:46work in everyday dictates your
culture and
31:49how people make decisions, it
dictates how hard people work.
31:52There's almost no important
more decision other than
31:54what company you're going to
be, than what's the office
31:57environment you're actually
in,
31:58and most people don't do that.
31:59And then the final thing and
32:01then I'll take some questions
is around effort.
32:05Ultimately, I don't believe
that you
32:06can build a company without a
lot of effort and
32:08that you'd need to lead by
example.
32:11the first chapter of his books
is, get's asked this question
32:14of how did you know whether
you're doing your job?
32:16And this is the answer he
gives coaches that used to ask
32:19him that question So if this
is what you
32:25feel like every day, you're
probably on the right track.
32:28And if that doesn't sound
appetizing,
32:29you probably shouldn't start a
company, truthfully.
32:30All right, with that I'm doing
with the prepared part.
32:34Let me see if anybody has
questions I
32:35can try to be helpful with.
32:40>> So you talked about making
compensation transparent.
32:43How would you do this,
especially when people equate
32:47themselves to value, you know,
of how much their salary is?
32:51>> I would, I would do it in,
probably, bands.
32:53because you could do it,
32:53either just everybody in the
company gets paid the same, or
32:55you could have, like, all
discipline, all engineers, or
32:58you could do it by experience
like extreme exp.
33:01The way Steve did it actually
at Next was,
33:02there was a high band and a
low band.
33:04And you either had a lot of
experience or
33:05low experience, and that was
it, so low band back then, you
33:08know, now it would probably be
like $85,000 kind of everybody
33:11just flatly gets paid $85,000,
and if your super experienced
33:14everybody gets paid like
$130,000, and that's just it
33:17like this sort of the Next
translated for inflation.
33:21>> Instead of what's the how
many details
33:28>> Well, yeah, so the question
was besides food what
33:31other kind of details do
people care about?
33:33The laptops they use.
33:34I mean, this is now the
default that everybody has.
33:39it was a benefit to give
people high-quality machines
33:42as opposed to optimizing our
costs and
33:44having Dell machines and ugly
monitors, just as an example.
33:47So if you think about all
these people that
33:49are relentlessly resourceful,
incredibly talented in
33:51a massively competitive
ecosystem competing for
33:54talent, you want to give the
people the best
33:55possible tools to do the best
possible job.
33:58And so, right rigorously
thinking through how do I
34:00make people more successful?
34:02What things do they not need
to be
34:03working on that are
distracting?
34:06And what things can I
34:06actually given them that make
them more valuable per day?
34:09And then just break that down
every day and
34:11solve that stuff yourself.
34:13>> So, when you're in a
start-up environment,
34:15how you you optimize for those
things?
34:17because, you know, resources
are scarce and.
34:18>> It's a good, it's a good
question.
34:20I actually think that you
should start,
34:21first of all, you must have
your own office.
34:23I don't believe ever in shared
office spaces.
34:25Peter talks a little bit about
this,
34:27that every start-up, every
good start-up is a cult.
34:30create a cult if you're
sharing space with people.
34:32Because a cult means that you
34:33think that you're better than
everybody else in the world,
34:34that you have a special way of
doing
34:35things that's different than
everybody else in the world.
34:37And if you're sharing physical
space with people,
34:39it's very hard to inculcate
that.
34:40So, I would start there, but
34:43it is a prioritization
question.
34:44When you have, everybody is
34:45going to have scarce
resources, just a question of
34:47magnitude like how many zeros
are you paying attention to?
34:50You know, probably not $10.
34:51Expenditures, put $100, then
$1,000,
34:53then 10,000, then a million,
and then 10 million.
34:55Starts being a rounding error.
34:57So, what I would do is figure
out like,
34:59what's most important?
35:00And in a high quality office,
that creates a good vibe.
35:02That allows you to recruit
people,
35:04because recruits are very
savvy about this.
35:06They walk into your office,
and
35:07they can tell a lot about the
culture instantly.
35:09I sometimes, I walk into a
company office and I can tell,
35:12often, whether I'm going to
invest, as soon as I walk in.
35:15Like, I can absolutely rule
things out that I
35:17just don't want to invest in
as soon as I walk in.
35:19And there's times walking into
the office is like,
35:21wow, this is very impressive.
35:22You can tell how people worked
together,
35:24how hard they're working, how
distracted they are.
35:26Roelof Botha at Sequoia made a
point to me about YouTube.
35:29So, when I invested in
YouTube,
35:31in the very, very beginning,
35:33it wasn't obviously going to
be successful.
35:35And then, Roelof led this
series A investment for
35:40And we were at a board meeting
together and he said,
35:42you know, I think YouTube's
really going to work.
35:45every time I go to one of my
portfolio companies,
35:47half the office is watching
YouTube at lunch.
35:49>> And I was like, pretty good
sign.
35:51So like, if you pick up on
these little things you
35:57>> What do you think is the
best way to gain street cred
36:01>> Oh boy yeah so the question
is how's the best way to
36:05grain, gain street cred for a
new manager?
36:09Almost all good managers in
Silicon Valley are promoted
36:11because of their individual
performance in cultures that
36:15are meritocratic, you know,
the percentage is even higher.
36:17So we tried at PayPal to only
promote people that
36:20were basically kicking **** at
their discipline.
36:22So Peter didn't believe in
general managers.
36:26In fact, I remember going for
36:27a jog around campus within my
first week at PayPal and
36:30he's asking me, you know,
36:30how are things going, the
usual kind of CEO questions.
36:33And then we got into this
36:34debate about whether the
company needed any managers.
36:36And he's like, nope.
36:38We're only going to promote
people.
36:39So the VP of Engineering is
36:41going to be the single best
engineer.
36:42The VP of Design's going to be
the single best designer.
36:44The VP of Product's going to
be the single best product
36:45person and they're going to
learn to manage later.
36:47And the advantage of that is
you don't demoralize people,
36:51because everybody knows that
their boss actually is
36:54better at their job than they
are, and they can learn stuff.
36:57And you can learn a little bit
of the management techniques
36:59later as opposed to promoting
people who
37:01are just good people managers
that don't actually have
37:04the discipline and skill, and
that does demoralize people.
37:07So I think, just being
excellent at something, and
37:09then getting excellent at
getting a bunch of people to
37:12do something is the next task.
37:14But people, you just have to
learn,
37:16some things you have to learn
by doing.
37:17You can't learn to play the
guitar by reading a book.
37:19You've actually gotta try to
manage a bit, and
37:22you won't do it well.
37:22I had another sort of set of
tactics and
37:25classes on what you actually
do when you transition from
37:28an individual contributor to a
manager.
37:31One of the first things people
don't get right is their time
37:34And so actually, I would
recommend doing what I
37:38call calendar audit and
tracking for a month what you
37:41spend your time on and how
much is managing and
37:43editing, and how much is
writing, et cetera, and
37:45then optimize it over time.
37:46You can get a mentor, find
somebody who's been a manager
37:49before that will work with
you, not your boss.
37:52Because your boss has a set
complicated objectives,
37:55including how much are we
shipping?
37:57A mentor can just focus on
you, and
37:59making you more successful.
38:02>> Can you give some more
examples of things you can
38:04do which show a consistent
voice of the company,
38:07especially with the company
growing?
38:10so, I would look at every
piece of
38:12copy in every department.
38:14So like another area that
almost never is a done.
38:17So look at your recruiting
website.
38:18Almost never done to
38:19the same quality as your
conversion funnel.
38:22I look at customer support,
38:23another classic area that
isn't up to the same quality,
38:26and treat customer support
like a product.
38:28So that you actually have an
engineering team and
38:30a design team over time,
38:31that actually focuses on
making that world-class.
38:34Usually, where you have
different executives at
38:36a scaled company, most
executives were
38:38trained differently at
different companies, and
38:40they bring some of that with
them.
38:41So you've got to cross train
that.
38:42So, if you've hired a VP of
Engineering from Google.
38:45It's very different than a
design leader who
38:47they don't actually learn how
to do anything the same way.
38:50So you're going to have to
stitch that together somehow,
38:52either one or the other is
going to have to learn in
38:54the other style or you're
going to have to create your
38:55own style and really teach
that to your executives.
38:58So it shows up all the time
but
38:59all you do, all you need to do
is just pick up the company's
39:02products and look for things
that have a different voice.
39:05Visual voice, word choice,
all, all over the map.
39:11>> Could you talk a little bit
about the tactics of how
39:14Like how you
>> So the canonical advice
39:19in this now sounds obvious but
actually was
39:21pretty radical in 1982 when
Andy wrote his first book is
39:24you should have a one on one
roughly every two weeks.
39:27Some people say every week,
39:29and I don't think you want to
go longer than two weeks,
39:31one week can be ideal actually
in many companies.
39:34The reason why in fact there's
ano, another adage which is,
39:36you should only have five to
seven direct reports.
39:39That actually derives from the
concept of a one on one
39:43So that the direct reports, so
you can fit enough one on ones
39:46in your calendar and still get
other things done.
39:48So I think one on one's per
week are a good idea.
39:50The agenda should be crafted
by the employee who reports to
39:54the manager, not the manager.
39:55The one on one is mostly for
39:57the benefit of the employee,
so they should walk in with,
40:00here's the three or four
things I want to talk about.
40:02Ideally, they circulate that.
40:03It can be even bullet points
in advance by email.
40:06But, in advance you have time
to chew on it and
40:07you're not on the fly, winging
your responses.
40:10But that's probably the best
structure.
40:12Now if someone's really good
and really talented and
40:14has been doing something for
40:15a long time with a lot of
internal credibility,
40:17you might push out the one
every week, and
40:19relax that to one every two
weeks, possibly once a month.
40:22I don't know that I would go
beyond once a month ever.
40:24>> When is it acceptable to
compromise and
40:27hire someone who is ammunition
rather than a barrel?
40:31>> Yeah, so the question is
when,
40:32when do you compromise and
40:33hire more ammunition instead
of a barrel?
40:36Truthfully, you're going to
hire more ammunitions by
40:38definition than you are
barrels.
40:40So there's a ratio between the
two.
40:41The question is the ratio.
40:43So at some point the ratio is
going to get out of wack.
40:45So if you're the only barrel
in the company and
40:47you have 50 engineers, you
might as well only have ten
40:49engineers because you're not
going to get anymore done.
40:51So you're just wasting
resources.
40:52You're going to have
frustrated engineers,
40:53because everybody's going to
need your approval,
40:55your sign off, your editing.
40:57It's just going to stack and
frustrate people.
40:59So, it's really, now different
disciplines, engineering,
41:02like I actually think like
roughly one to ten to 20 is
41:07probably about the right
range.
41:10Like you don't need more
engineers until you
41:14Designers a little different,
41:15but it's always going to be
hiring more ammunitions.
41:21a good barrel will kind of
have a feel for that.
41:23So one way to, one way to
correct for this.
41:25Natural tendency is to
increase that your headcount
41:28on your team, like sort of an
empire building tendency.
41:30Like, oh so I manage 20
people, and
41:32Sam only manages ten, and you
manage three.
41:33So, I'm more important than
Sam and
41:35you're more important than
you.
41:36One way to do that is you put
an X here of
41:37the number of people that the,
the output, sorry, specify how
41:40many things they've done
successfully then divide by
41:43the number of people on their
team, and tell them that this
41:45is going to be their grade in
their performance review.
41:48Shockingly this y doesn't
start increasing on that team.
41:51It's amazing how this works.
41:52And be really explicit about
it.
41:56>> As, venture capitalist,
41:58how often you intervene this
and, what's.
42:02>> So how often do I meet
with?
42:05[CROSS-TALK].
>> So the question is,
42:06as a venture capitalist,
42:07how often do I interact with
my companies, meet with them.
42:10Generally when we invest and
we do,
42:13do some seed investments where
we invest less money but
42:15when we invest a fair amount
of money and
42:17lead a round like a series a a
series b round
42:20we join the board, and roughly
I meet with
42:23the founder CEO every two
weeks, that's the default.
42:26Now there can be obviously
there's inflection moments and
42:28things go right well or wrong.
42:31And, you know, that's on an
ad-hoc basis.
42:33These days, actually,
42:34surprisingly, I do a lot by
text message.
42:37I even have one CEO who
Snapchats me all the time.
42:40Which I'd actually rather not,
but, That, so.
42:44The world, the world has
changed a lot.
42:46But I try in-person meetings
every two weeks.
42:51I mean, really it's,
42:52like, being a venture
capitalist is more,
42:54to me, like being a
psychologist.
42:56my office you'll see actually
we have two chairs,
42:58kind of arrayed like this with
a little table in the middle.
43:01And I'm basically, like, so
tell me your problems.
43:03You know?
[LAUGHTER] Then,
43:04it's like a question.
43:05It's like, so have you.
43:06And then the, and then my
response is usually,
43:08well have you thought about
this?
43:08Have you talked to this
person?
43:09Have you tried this?
43:10Et cetera.
And it's just asking a lot of
43:12questions and going back that
way.
43:13But that's 90% of what I do.
43:17So I see when you, when you've
got these barrels,
43:20you say your starter company
is up doing really good,
43:22you know, and you're working
on this project.
43:24I've heard that you should
always be recruiting.
43:27>> Yes.
>> How do you,
43:29how do you balance that.
43:32Well it depends on where your
prioritizations are.
43:34So you know, Sam talked a
little bit
43:35about this in his lecture,
43:36but every company will move
recruiting you know, first,
43:39second, or third somewhere in
that sort of spectrum.
43:42If it's your number one
priority then about 25% is
43:45probably a pretty good
allocation.
43:47Actually I like the calendar
audit for
43:49CEO's even more, so than for
new managers.
43:52So when I work with CEO's
sometimes who aren't.
43:55Thriving in that role for the
first time.
43:57Actually forced them to show
me their calendar.
43:59And before I do that, and now
I'm going to ruin this trick
44:01because if I tell it to you,
actually asked them to
44:04write their priorities, write
them down on a piece of paper.
44:05And, you know, discuss
whatever they are.
44:08Then we go pull up their
calendar, and
44:10And it never matches.
44:12They, recruiting is the one
that's most often.
44:14Awry so you know, let's say
half the CEO's you meet with
44:17will say recruiting's the
number one priority.
44:19It's almost never the biggest
block of
44:20time on anybody's calendar,
and so
44:22that's what you're trying to
do is match resources and
44:25inputs against priorities, and
a calendar audit unfortunately
44:28there's no software that does
this really well.
44:31we literally pull up someone's
Google calendar and
44:33kind of manually add up the
hours.
44:35Which in, somewhat insane.
44:36But that's, that's the best
way is just,
44:38well what are your priorities.
44:38If your priorities are raising
money, you
44:41don't want to allocate 100% of
your time for recruiting.
44:42You want to allocate a fair
amount of time to raising
44:45money for that block of time
until you're successful at it.
44:47>> One more question.
44:50>> One more question anybody,
okay, go ahead.
44:52>> On the surface some of the
advice students contradictory
44:55because you emphasized
focusing on a plus pass, and
44:59delegating less important
things, but then you said it's
45:02good to write like few page
script for your receptors.
45:05Focus on all the details.
45:07How do you harmonize those
goals?
45:08>> It's a good question.
45:09I think the way to harmonize.
45:10The question is really, how do
you harmonize things like,
45:12where details can really
matter but
45:14you only get one thing, you
know, to do and
45:16you've gotta allocate to the
top one, two, or three things.
45:19How do you, how do you put
those two things together?
45:21And actually there is some
tension in, even in a healthy
45:24organization, there's some
tension of like why are we
45:26actually focused on, you know,
writing the script.
45:29As opposed to something a user
may see.
45:31I think the underlying
philosophy of
45:33getting the details right is
pretty important to
45:35install in the very, very,
very beginning of
45:37a company because people will
start acting that way and
45:40making decisions that way
themselves.
45:42So, you won't have to actually
literally do that.
45:44And if you have to do that, it
actually shows you
45:46that the foundation isn't
actually that, that solid.
45:49So eh, when you first start
the company.
45:51It's about getting the details
right,
45:53that everybody is precise,
45:55everybody on every task is
always thinking that way.
45:58And then that scales, and
45:59then the people you bring in,
it's a little self-fulfilling,
46:01people who can think that way
will tend to get hired,
46:03people who can't won't get
hired.
46:06each leader, will tend to
enforce that themselves,
46:08to see whose almost never
doing it.
46:10So, it's partially, like,
46:11how do you start, and at
cultures like that,
46:13I mean, the, key to culture is
it's a rule.
46:15It's a frame work for making
decisions.
46:16And if you have a cultured
people learn how to
46:18make decisions across that
culture and
46:20you're never day anything,
except just yeah watch.
46:25And you know and promote and
move people around.
46:28Cool, well I guess that's it,
thank you.
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