Lenny Rachitsky: belief

Transcript context

…We start Waze with the vision that we are going to help people to avoid traffic jams. Now the reality is that there are more traffic jams today than there were in 2007. Obviously, number one, I'm not done. And number two, if you ask people what is the value of Waze, then it's not about avoiding traffic. It's about creating certainty and certainty is way higher value than saving time. So you know exactly when you're going to get there and this is a way higher value. And by the way, we learned that in the U.S. market when we spoke with people. They told us, "If I am living in Cupertino and I need to drive up to San Francisco and I can take 101 or 280, I don't really want to change my route unless there is something dramatic, but what I really want to know is how long it's going to take me. So I'm going to stay on the 101. I'm not going to get into service road. I'm not going to take El Camino Real. I'm not going to try something else. I'm going to stay on the 101. Just let me know how long it's going to take." So certainty creates way more value than saving time. I want to talk through a couple other of the chapters in your book. So chapter four is around the different phases of a startup journey and your core advice is that it's important to focus on one thing at a time in each of these phases, and the first phase, you call it the all over the place phase, I think, or yeah, the all over phase, and the idea is you need to get out of that as soon as you can and then focus. Can you just kind of talk through these different phases and what you think people do wrong along the phases? Maybe they get them wrong or they focus on the wrong things in each phase. So initially you think about your new idea from multiple perspective, right? This is the problem. This is how this solution is going to look like. This is what I'm going to do next year. This is my 10 years vision. This is my business model and so forth. So you think about everything, but you actually need to execute only one thing. Now this one thing is figuring out product market fit. It's not one thing, right? Wait a minute. You also need to build an organization and you want that organization to be something that you really like and so there are a lot of operational stuff, but you need to figure out product market fit. As we said earlier, if you don't figure out product market fit, you will die. If you do, then you get to live and die another day and the other day is whether or not you're going to figure out how to grow your business and whether or not you're going to figure out your business model. Now the good news is that I will tell you that if you create value, you will figure out a business model, at least for the people that you create value for them. They are most likely willing to pay. Now in general, I'm not saying that this is the only business model that is viable, but if you create value, you will figure out a business model. But figuring out a business model is a journey by itself, and guess what? It's going to be a long roller coaster journey of failures. When we started Waze, we thought that we're going to sell map data and traffic information and we ended up with doing advertisement. Very different business model. Because we realized that it's not for us. It's too long sales cycles. We were very mobile internet dynamic company and selling to government is not exactly what we wanted to do, and so we ended up with a different business model, but with a lot of reasoning why this is the right business model for us. And figuring out growth, look, if I would ask a hundred people on the street, how did you hear about Waze? They, 95 of them, if not 99 of them, will tell me, "Someone told me." Word-of-mouth, right? So everyone wants to have word-of-mouth. Word-of-mouth you can only have if you have high frequency of use. If you're doing tax returns once a year, even if you really like the experience, then once a year you're going to tell someone else. If you're using Waze every day, then every day you have an opportunity to tell someone else. So word-of-mouth, even though that everyone would like that, it's only going to happen if you have high frequency of use. So those phases requires different focus of the company, right? Initially if you focus on product market fit, then you don't need sales. You have no product to sell. You don't need business development. You don't need even marketing. You need product. You need developers and you need product lead to define the product and lead through the iterations of the product until we get to the level that it's good enough. Once you get there, you shift gears.…

Stored transcript either side of the excerpt. The highlighted words are the published quote; the surrounding text is unedited source, never generated.