Pivotal Moment Stories

June 19, 2007

Doesn’t it seem like you can have two stories in your life? There is the story you had before your success, which has its own rhythm and set of characters. And there is the story you have after the success.

I was thinking of heavily celebrated entrepreneurs like Steve Jobs, Bill Gates, JP Morgan, and Disney, who were normal people before they succeeded in business, and suddenly became mythologized super beings.

I think an alternative story needs to get heard more often, at least this new story is more inspirational to myself:

There was this guy who had a vision of doing things a different way. He was actually pretty poor at transmitting his vision, largely because the conceptual components necessary to transmit the vision easily would not come into full existence until the vision had been realized. Most of his friends encouraged, but did not believe in him. His parents always believed in him, but even they did not understand him very well.

Eventually the protagonist changes the world when everyone catches on to his good idea. The story is still the success story, but it is heavy enough on the unpleasant reality of being viewed as slightly insane and going in the wrong direction.

Success seems to me a lot like surfing, where wave after wave appears to come and you have to paddle every time, even when the wave does not materialize. If you look out at the ocean, and you see people doing this, but you only look for five minutes, you may just think the people are crazy because the purpose of their paddling is not obvious.

I think the worse part of it is that in creating ideas to drive companies there is not even the advantage of seeing a swell. It is more like you are paddling in the middle of entirely calm water. Of course, the people who are successful are paddling all the time, moving from place to place, claiming a big wave is coming.

This is why it is good to surround yourself with people who have a similarly distorted view of reality. It makes it easier to keep going. You all believe the wave is coming.

My Friends, My Founders

April 30, 2007

My co-founders are people who can tell me when something is wrong. For example, my co-founder called me today and talked about misgivings he was having about the company. He didn’t see how the company was aligning with a lifestyle that would get him the things he wanted. The beautiful thing is that he was telling me this. I’m so happy to be working with friends who are unafraid of discussing such things. Not only can I discuss my often radical (and sometimes stupid) ideas, but I can operate unafraid.

I hear things like, do you have an A-team or a B-team? Do your co-founders have the proper skill-set? I am lucky that my friends and co-founders have a very dynamic sense of competence where they move from unknown to unknown with little difficulty. But the thing I am happiest about is the sense of fearlessness we manage to generate in our culture. It would be naive to say this is all you need, but you can always acquire skills and more expertise.

An open culture is invaluable and far more difficult to create because it requires the sacrifice of pride. It takes a lot of practice to say, “No, that’s a bad idea,” to someone in the middle of their sentence. And it takes even more practice to not snap back and tell them they’re full of shit. However, when you finally achieve this state, you save so much time!

My company will be invulnerable to innovative stagnation and incumbency collapse. To do this, when the company reaches 162 people it starts giving two fully-payed-months to 27 people to go and start their own companies. This means that every two months, 27 people leave the organization and 27 come back.

Most of these groups will break off into two and three person founding groups. These people would be cut-off entirely from the management structure and strongly discouraged from communication with the central corporation. You would not be allowed to come to work.

Some of you may be familiar with Google’s policy of 80/20 time. 80% of the time you work on company projects, and 20% is reserved for your own. But since you are connected to the social structure, no matter how liberal the management, you still end up working 120% of the time if you choose to work on side projects. This problem is why the breach between the central company and the startup teams has to be severe for true innovation to occur.

The advantages to this internal form of startup is that if you fail, you still keep your job. And most of the projects will fail. But some of them will succeed and cause the company to grow. As the central group grows beyond 162, it will spawn groups based on these internal startup successes.

Of course, compensation will have to match people’s time investment, otherwise it will make more sense for people to leave the company and start their own companies. So if your internal startup succeeds, it will be absorbed by the central company and the startup team will get a reward equivalent to being acquired in the startup market.

How to Give Up

April 19, 2007

When starting a company it is important to know how to give up. A founder has to cultivate a certain amount of insulation to stimulus in order to keep going with an idea and make it successful. Starting a company is essentially an insane activity when you measure it by the standards of most people. It’s not insane to me because I enjoy a certain amount of risk, but in all start-up likelihood I will fail. However, the quality of the work I do sustains me, and of course there is always the chance that it will make me rich.

So if I have this determination, how do I let go of the proper things at the right moment, while not giving up? I cultivate a systematic view of my success. Very broadly, I am forming a company to make something which will create some change which will make me rich. By holding this view it has allowed me to get through the following problems.

First, we lost our initial third founder. He knew way more Ruby on Rails than I did at the time. I had gone through only one tutorial online and was making my way through another. I still felt pretty incompetent in the framework. So I could have given up, but I didn’t because I held this overall view of what I was doing.

Second, we didn’t get the funding we wanted. It would have been with very interesting and well-connected people. So now we were all going to have stick with some sort of part-time day job and labor in our spare time. This sucks. This makes you want to get a real job and just get payed. However, I’m making a company and this is an acceptable loss. As all things pass in time, so do new oppurtunities for money arise.

Third, our idea sucked. Bizzarely, this was the easiest one to get by. We had been working on it for quite some time. We now had something to show people. But as the image increased in resolution so did the flaws in the model. If you were looking at me as this dawned, you would have seen me typing at my computer in the garage. I sat my head on my hands and ruffled my brow for a moment. I got up, went into the other room and said the idea sucked and it wouldn’t work. And then I stated the next idea we working on. I was murdering a baby, but it turned out I didn’t love the baby enough to make me delusional, I loved the idea of the start-up more.

All of these have been fairly external issues, which is why they have been easy to deal with. The next was when my co-founders were feeling unappreciated. I live in the Bay Area and they wanted me to move down to San Luis Obispo (3 hours South) to live and hack with them. For various reasons that only became clear to me over time (perhaps another blog post), I was unable to. They interpreted this as me not wanting to share the work with them. Up till that point I did most of the work myself. But suddenly they took great offense and since I am working with good people, they expressed it to me. So we hashed things out and some of it’s still getting dealt with, but I hope it will be resolved. This is the first failure that has been directly my fault.

Interestingly, this problem has allowed me to understand how I defined the difference between a founder and an employee. A founder is driven entirely by his own initiative. That statement is obvious, but in the context of my own experience it means the other two founders should be going about their business automatically. They should rip the code out of my hands if they have to and start working on it (and it is my duty to let go). But they did not do this. Now I am sounding like I am shifting blame away from myself. It is still entirely my fault because of my failure to communicate what my expectations were. If that had been communicated it would likely have been a non-issue.

Undoubtedly, I will have more failures. There will be plenty of right and wrong things to give up on. I’m hoping that what leads to my success will be a comfort with failure.