Hamilton Helmer: evaluation

Transcript context

…I think you did say that. I think this concept of a second invention is literally your words from a previous episode. Product/market fit and power are more or less orthogonal. There are some complexities in that statement. I'll tell you something, Ben and David, that has occurred to Chenyi and myself over the last year which is a little bit different maybe than what's said in the book, which is that I used to think that it was sequential. You get product/market fit and then you deal with power. My biggest education is talking to founders. I love their intelligence, their creativity, dare I say, their youth, and their deep thoughtfulness about stuff. What I'm finding is that the proper path is actually to be thinking about those things simultaneously because what's going on is you're trying to figure out, okay, what am I doing with this business? I've got this choice and this choice. In the mix of that, there are both product/market fit questions and power questions. You don't just say, I'm just going to do the product/market fit stuff and think about power later. You actually need to start thinking about it. You won't solve it completely at the beginning. You won't know, yeah, I have power, for sure. But you should be thinking about it. Persistence then leads you down to those structures. Part of the reason that it's really cool that you're thinking about this in your interviews and we think about it in our work is one thing I've said to you before. The genotypes of power are simple. There are only seven. My partner, Bill, says that it turns strategy from an essay question into a multiple choice question, although I don't know what ChatGPT or the difference is anymore. The phenotypes, that is the exact granular way on which they are articulated and carried forward, are complicated. Chenyi and I might struggle for weeks trying to figure out whether something has power or not. I'll give you an example of how the idea of power is so important. I'm a sports car nut. I used to drive too fast. Porsche is a great example here. Think of that, the 911, first one came out in 1964, 60 years ago. For sure, it wasn't the sportscar leader of the world at the time by any means. What that enabled Porsche to do, which I don't think was conscious exactly but spun out in an evolutionary way over time, was that they took away the design element as part of the mix in what wins over sports car enthusiasts. If you looked at a 911 in 1964 and a 911 today, they look the same. What did that allow Porsche to do? It allowed to just constantly optimize the best performance features in the context of what people would pay for that—handling, acceleration, interior ergonomics—and the technology frontier was changing fairly rapidly. Today, I'm just astonished at the performance you can get from a small scale Honda that'll go 155 miles an hour, faster than a Jaguar XK-E back in my day. There are all kinds of parallel developments in other aspects—brake, sound deadening, and everything else. m a small scale Honda that'll go 155 miles an hour, faster than a Jaguar XK-E back in my day. There are all kinds of parallel developments in other aspects—brake, sound deadening, and everything else. They could constantly upgrade each generation without having to think about the design aspect to it, but it hit the performance envelope, and people would pay for that. You needed all those things. Consequently, they end up with this incredibly durable business model, by far the most profitable automobile maker, devoted fans, and great cars.…

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