Book Review #Ten of 2021: Hard thing about Hard things

A book by Ben Horowitz. I heard it is so popular among Venture capitalists, that they refuse to fund a startup until the founders have read this book. 

When a book has praise from Mark Zuckerberg, Larry Page, Dick Costolo, and Peter Thiel on its back cover, one is guaranteed he is reading a good book.  No wonder this book was recommended to me by 2 CEOs of startups who have successfully raised money.  The book stands out from other books as it tries to answer some critical challenges common for startup founders and how to navigate them. Hiring and firing and promoting talent are some of the most important challenges for a startup and there are no easy answers. The book’s appeal to me was limited as its core audience is a Startup CEO.  Nevertheless, I found some apt ideas to evaluate listed companies and CEOS. 

Companies not meeting guidance:

Nobody cares about why u missed guidance. So, stop kidding. They are no good excuses. Also, guidance mgmt. is a slippery slope. It is very common for companies to justify the low growth/margins this year owing to lumpy last quarter or one-off.  The question is did they disclose last quarter there was a one-off or it was lumpy?

Learnings for across companies:

Employee Pay:  In many companies, the best way to get a raise is to generate an offer from another company and then threaten to quit. This I witnessed is a very common practice among equity analysts and the team felt cheated when few people were able to get raises just because they got counteroffers.

Guidance miss- Nobody cares: Companies either meet guidance or miss guidance.  Companies come out with elaborate press releases to explain reasons for missing.  Frankly, nobody cares. Either get better at forecasting or stop forecasting.

Quality beats quantity:  Almost all managers will try to enforce a quantitative way of evaluating employees. For equity analysts, some of the quantitative measures are the number of calls done to clients, number of reports written, etc.  I have seen gross ways of people gaming the system. Analysts would record calls done to the fund manager even if the FM did not take the call or hang up the phone as he was not keen. Every insignificant event is converted into a report as a stock/ sector update. Thankfully, our organization soon understood how the system was gamed and discontinued it.

A good book recommends or gives ideas of other good books. Some recos:
  • Yertle the Turtle by Dr. Seuss
  • Only the paranoid survive – Andy grove
  • Good to Great – Jim Collins
  • High output management – Andy grove
  • Jeff Bezos 3-page letter to shareholder in 1997 outlining the company’s story. Attached

Quotes from the book ( For CEO’s / Founders) :

 What would you do if capital was free?  Is a dangerous question to ask an entrepreneur.   It’s kind of asking a fat person.  “what would you do if ice-cream had the exact same as broccoli?

The best option among a particularly ugly set of options.

If a warrior keeps death in mind at all times and lives us though each day might be his last, he will conduct himself properly in all his actions. 

On company missing guidance: they were not lying to investors, but rather, they were lying to themselves.

We take care of the people, the products and the profits – in that order.

Being a good company is an end in itself.

Great CEOs are basically people “Who didn’t quit”.

Most people define leadership the same way as Supreme court justice defined” pornography “I know it when I see it.


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