Drew Houston: recommendation

Transcript context

…Roger's been on the podcast. Yeah. I'm a huge fan of Roger's. And I was like, "All right. Well, if we think we're selling a commodity, try literally selling paper towels. " Which is what AG, and Procter & Gamble, and a lot of CPG companies do. And AG was the CEO of Procter & Gamble at the time. And basically, he and Roger did this download of how they think about competition, and markets, and advantage. And a lot of it's thinking really critically about where do you play, and how do you win? So being very selective about the markets you're in, and only being in markets where you can have a leadership position. And then, being really crisp about what is your leadership position? And so that was a very timely thing to read in terms of, "All right. Dropbox looks like one product, but it's really participating in many different markets. And our big risk might be that we're the number two best thing in each of those markets, which would be a bad situation." Another really influential book was Only the Paranoid Survive by Andy Grove, and I'd been a big fan of Andy's. High Output Management is another great book of his, which was my introduction to management. At least, his theory of management. So just loved that book. And then Only the Paranoid Survive talks about Intel's experience where they actually had something like this happen that I wasn't aware of, and we all know Intel as the microprocessor company, Intel Inside. At least in the 80s, 90s. But before, they were in microprocessors. They sold memory, RAM. In the 70s, they were running into a situation where they were really high growth, successful business selling memory. But then, they had these Japanese competitors that were just building memory faster, better, cheaper. Just on every dimension. And potentially, also, things like anti-competitive things where the government might be subsidizing these manufacturers. This feeling not only they might just be better at the game, but there's also not a level playing field. But meanwhile, you wouldn't see it in their numbers. They're still growing. And just that there were these weird dissonant experiences where salespeople just suddenly have problems selling into accounts that used to be a slam dunk, or things that used to work just stop working. And this happens. Blackberry's, and Nokia's best sales years happened in the years after launching the iPhone. So these things don't actually change immediately. And so Andy labeled these moments strategic inflection points for a company, and I'm like, "Yeah. Then, we're definitely in a strategic inflection point." But they were dealing with, "Oka., our whole business is memory. How do we deal with this competition?" And there's this little vignette where he and Gordon Moore, one of the other co-founders of Intel, said, "Hey, let's pretend we're consultants to ourselves. What would we do?" with this competition?" And there's this little vignette where he and Gordon Moore, one of the other co-founders of Intel, said, "Hey, let's pretend we're consultants to ourselves. What would we do?" And what they immediately decided was, "Oh, well, we clearly get out of the memory business, and put all of our chips on this sketchy little microprocessor thing that was much smaller. But very high growth, and potentially big market." And then they're like, "Well, why don't we do that?" Only problem with that is it's like Google saying, "Yeah. Let's get out of search, and go all in on Gmail, or something, or YouTube." So it just seemed insane. Andy cautions in the book that, "Look, most of the time CEOs want options. They want to hedge their bets, but what you really want to do in these strategic inflection points is go all in one thing." Or as Mark Twain put it, "Put all your eggs in one basket, and watch that basket." And I was like, "All right. This makes sense to me, but man, this is going to be painful." So we go away for 4th of July. I'm with my family in New Hampshire. I reread the book, I come back. All right. I'm like, "Well, we really got to do it." Then, I just killed Carousel, killed Mailbox. Went all in on productivity... Killed mailbox, went all in on productivity. To some extent, that was a relatively easy decision because most of our subscribers, 80% of people paying for Dropbox were using it at work. But that meant foreclosing on photo sharing and consumer and storage and all these things that Dropbox had become synonymous with and to this day are some of the things that we're most recognized for. And I wish I could say then everything got better. It was the opposite, actually, the narrative completely flipped on the company. The press started, we killed these new products, and then internally and externally, the narrative became super negative. Articles would come out every week or two, like, oh, Dropbox could be the first dead deck of corn. And then sometimes we've all seen this in tech companies get in this washing machine of self-perpetuating negative press. And if it goes deep enough, I mean, Uber had this for a while later, Meta's had this over their history, lots of companies where you just can't get the monkey off your back. And then because what the reporters end up doing is they basically park their metaphorical van behind your office. They interview all the people that you just fired and then print everything that they say anonymously as if it were facts. And there's a lot of truth to what the press were saying, so I can't really blame them or saying they were being unfair, but it immediately put recruiting into this deep freeze. You're just in the situation. You've started this company, it's been super successful, and then suddenly your employees don't want to wear your T-shirt anymore. And frankly, you don't even want to wear your T-shirt anymore. It's just your pride in your own company takes a big hit. And meanwhile, I've talked mostly about the external market competitive forces, but inside the company was a mess too.…

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