Lenny Rachitsky: belief

Transcript context

…Yeah, thanks for having me. Excited to be here. As I was researching your background and prepping for this podcast, I learned a really interesting fun fact about you that I don't think a lot of people know. So Travis Kalanick, he had a startup before Uber. It was called Scour. It was a peer-to-peer file sharing app, and then I think got shut down. You were his co-founder. This was the early part of your career. I'm guessing there are hours of stories we could talk about during this experience. So let me just ask you this one question. What's just a lesson that has stuck with you from that experience that you've taken with you to future places you've worked and built product at? I mean, there's so many lessons. I like to pick one. I think that the main lesson is that in business and in startups, everything's negotiable. I think that's the main thing. Because we were 19 at the time, 19, 20 at the time, we built this search engine in a dorm room and we were running it out of the dorm room and our first URL was scour.cs.ucla.edu. These things were not necessarily in fractions at the time, but we were just being practical. It was basically a project that we had started, and so we built the search engine and people started using it and we thought we would get in trouble, but it turned out the computer science department was excited about it even though we had basically parked a domain on their servers and we were using our own computers in the dorms to serve up this website and product. And then, when we got into financing, the financing process was fascinating, and this is where the everything is negotiable lesson came from, which is, it was Ron Burkle and Mike Ovitz, who are the initial investors in the business. We were in LA, so we were at UCLA, so we were not quite wired into the entire Sand Hill Road scene. And as we were doing the deal, the terms kept changing on us. We thought you went and raised money and it was like, "Oh, we'll get a few million dollars at a $5 million valuation." This is back when that was actually a series A valuation. And then over the course of the deal, it was like, "We're doing the deal. We're not doing the deal. Oh, you should give us 50% of the company. Oh, you should give us 75% of the company. Oh, if you want to sign the document today, this person's going to show up for breakfast and if you don't sign today and give us 80% of the company, the person's not going to show up." It was just completely wild, the things that we saw from day one of what can happen in business, and we thought there was a way to do things, and at a very young age we realized there is no way to do things. There is just the way that you can negotiate your way through the world, which I actually think influenced Travis heavily and then me later heavily at Uber in terms of if you can imagine it and it makes sense and you can align incentives, then it can happen. But there is no way. And to learn that at 19 or 20 years old I think was highly imprinting.…

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