Lenny Rachitsky: prediction

Transcript context

…What I've realized, and this is another insight, is I can actually, and this is a bad way to look at it, but I can actually pay people less if I give them better experiences. And so ultimately I can actually do more and then I just don't count on them staying so long. And so for me, I actually pay people, I pay them fairly well, but I know they can make more money elsewhere. And ultimately I want them to be attracted to go. So if they need more money, they should go somewhere else. But if they're here to learn, that's what I want people who are here to learn. And basically the way I work it is I give them a reasonable salary and then I give them big bonuses so they can save money to go do what they want to go do. So I always see this as, I don't expect anybody to be with me though. People have been with me for a long time. It's one of those things where every year we sit down and talk about what's progress mean to you and how do we actually figure it out? And ultimately, I've added some offerings to my business that I would never do, but I know that this other person who works for me wanted to actually do more coaching. And I'm like, okay, we brought in three coaching clients and basically she loved it and that gave her basically more energy. And so part of it is to make sure that I can adapt to basically keep her here and make sure that she's making progress. I don't think there's anything controversial about that. If you're a cool company that everyone wants to work at, people will pay, will take less salary because of the experience they're going to get and the potential. That's right. And the other problem I realized is that when you overpay people, what happens is that they actually become more and more scared that they will lose it, and then they become more and more conservative because they don't want to rock the boat and they actually don't work. They do what they're told as opposed to do what they should do. And so you start to realize that money has a very interesting impact on behavior, and I have not studied it in any great fashion. There's many people who have studied more than me, but that observation of when I overpay people, they're all about, I just don't want to not get my bonus and you better make sure that I can. And you start to realize, but they don't know what it takes to get the bonus. And so you start to realize trying to innovate when everybody's only around bonuses, I suppose, that they love to do this work. Usually when they love to do the work, they get more bonus.…

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