Ben Horowitz: evaluation

Transcript context

…There's something that I saw you share that I love, which is running towards fear versus running away from fear. Something that you tell all your leaders to work on. Easy to hear, hard to do. We don't like doing things that are scary, running towards things that are scary. Why is this so important? Why is this something people need to learn to do? Well, so the biggest mistake that you make, the worst thing that you do as a leader, there's things in your control and there's things out of your control and hesitation, that's generally the most destructive. And I go through all the ways that it's destructive, but it's extremely bad. And the thing that causes you to hesitate is both decisions are horrible. It's that business school where you're going through a case study, "And if you had done that, then the company would have gone this way. But if you had done that, it's a great success." That's not actually what happens to you as CEO. What happens to as CEO, it's like, "Okay, if we rearchitect, this product, the architecture is not actually get us to where we need to go. I kind of know that. But if we rearchitect it, we're going to probably miss all the features, miss the quarter, have trouble raising money, shudder, et cetera. So that's really bad. And then not rearchitecting is really bad, and so I'm just going to try to and avoid this subject because I don't even want to deal with either of those. " And that's the worst thing, because if action is the better choice and that's good. And then if you don't make an explicit decision, then the whole company's going to get nervous because they know that the architecture is whack and you got to fix it. And probably one of my bigger ones on that was we went public with $2 million in trailing 12 months revenue at 18 months old. That's obviously a bad idea. I mean, there's no question that wasn't a bad idea. But the truth of it was the alternative because of where the private markets were was going bankrupt. And that's a worse idea. And if you look at that time, March of 2001 when we went public, you just look at the number of CEOs that hesitated on that and didn't do it and went bankrupt. It's a lot. And so that getting good at making a decision that everybody's going to go, "Wow, that was insane, Ben." The Wall Street Journal wrote a whole long story about how stupid I was. And then Businessweek wrote a story called the IPO From Hell. That was the name of our idea, the IPO from hell, which was accurate in a sense. So that's really bad, but it wasn't as bad, and this is why it's so scary you make that decision that's going to happen. I knew those stories would get written, there was no question. And yeah, that's the kind of muscle. So if you think about the psychological muscle you have to build to be a great leader is to be able to look in the abyss and go, "Okay, that way slightly better. We're going to go that way. And it's very hard to do." I would say it's a thing people struggle with. And it began something, should I fire the head of sales? So I don't want to have that conversation. And then I'll have to replace them. And then there's going to be a bad PR story. And you can kind of quickly calculate all the bad stuff that's going to happen if you do it. to have that conversation. And then I'll have to replace them. And then there's going to be a bad PR story. And you can kind of quickly calculate all the bad stuff that's going to happen if you do it. But if you don't do it, that's probably going to be much worse and that's why you have to run towards the pain in darkness.…

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