Naval Ravikant: Try to be one of the people who creates things

In the clip below, Naval shares that one of his favorite Peter Thiel-isms is that you should have a “definite view of the future.”

“You should actually go out and build the thing you want to see exist—not just say ‘oh, that’s gonna happen. I’m just going to sit back and wait for somebody else to do it.’”

Because things don’t work that way.

“Things don’t just automatically show up. There are great men and women who go out there and create these things. So try to be one of those people who creates these things.”

And if you’re going to be an investor:

“At least bet on things that you think may not exist without you betting on them.”

Sure you can make money by trying to be first to the hottest deals that are going to get funding anyway. But Naval argues:

“You will not make the most money because the greatest winners of the last few decades have been unexpected winners… Their dreams were written off because it was believed that their dream was impossible and too expensive.”

He gives SpacEx, Tesla, OpenAI, and Apple Computer as examples.

“When you see these impossible dreams come true, not only is it the most fulfilling thing, it’s also where you make the most money.”

Source: @AngelList Peter Thiel on the importance of having a definite view of the future:

https://twitter.com/StartupArchive_/status/1754127389406216342

Marissa Mayer on scaling Google and the internal black market CEO Eric Schmidt created for new hires

“One of the things that [former Google CEO Eric Schmidt] talked about a lot was that at every order of magnitude, you should expect every process to break—and you should expect to have to completely reinvent it. It’s very different to deal with tens of people versus hundreds of people versus thousands of people”

Marissa shares a story of how one time Eric reinvented Google’s hiring process in a way that initially frustrated everyone:

“We had closed the year at about 200 people, and we had a plan to double the size of the company over the coming year. Eric showed up in March, looked at the plan, and said: ‘there’s just no way you guys are going to be able to double the number of employees and keep the quality and culture the way you want it to be.’”

Eric then told the company that he would let them collectively hire 50 people that year—versus the 200 they were planning on hiring. And to enforce this, he created 50 laminated dollar bills with Larry Page and Sergey Brin’s faces on them and distributed them to Google’s VPs. Every new hire that year would require one “Larry & Sergey” bill.

Naturally, a black market for these “Larrys & Sergeys” developed, and as Marissa describes, it became surprisingly efficient:

“What would happen is the Head of Sales would have one and he would really need a new feature to make a sale. So he would [say to the engineer]: ‘look, I’m going to give you this Larry & Sergey but you have to promise you’re going to use it to hire someone who is going to build this feature to secure this revenue.’”

She continues:

“As painful as it was because there was way too much work to slow down our hiring like this, [the new process] was actually a really good moment for the company because it made us be really thoughtful about how we were scaling and where we were putting our resources. We had to be that much more thoughtful about what to prioritize and where the opportunities were. Yes, hypergrowth is really fun, but you also need to realize that you want that hypergrowth to happen in terms of users and revenue—and not necessarily in terms of the size of the company.” Watch the full @GreylockVC Blitzscaling lecture with Marissa Mayer here:

Former Google CEO Eric Schmidt explains how he uses 5-year plans to predict if a startup can become a $100B+ company

“If you went to business school, you would’ve been taught: build a great product, organize a sales force, charge a fair price, make the customer happy.”

But Eric explains that strategy is insufficiently scalable in the Internet era.

“It’ll produce a reasonable business, but it’s not going to produce a huge business. It’s just too hard to hire all of those salespeople, work with every customer, and so forth. You have to have a more clever strategy.”

He continues:

“All of the really big companies have invented a new way to access information or a new way to do something that didn’t require [a large salesforce].”

Eric argues that lots of the startup ideas he hears are good, but not good enough. He tells these founders to create a 5-year plan and map their growth rate. Then try to figure out what a more scalable strategy might be.

For example, if you’re building an app that you want to charge $10 for, Eric asks:

“Why can’t you give the app away for free and then upsell the users?"

This is similar to the advice of Peter Thiel who famously asks founders: “How can you achieve your 10 year plan in the next 6 months?”

Thinking big and optimizing for scalability is one key factor that separates the ultra successful companies from the rest.

Another way to use a five-year plan to determine if your company can be a $100B+ company is to ask yourself what the big platforms will be five years from now and make sure your company is aligned with those platforms.

In this interview from 2016 and he predicted that Android, iOS, and machine learning would be the dominant platforms of the next five years.
Eric Schmidt also argues that you should "hire the divas" here:

https://twitter.com/StartupArchive_/status/1709575410886037545

Naval Ravikant shares the most valuable advice he’s received

When asked about the best advice he’s ever received, @naval says he first ignored it.

“It's the same [piece of advice] that everyone who's been in the business for a long time and has a lot of gray hairs tells you… whether it's Warren Buffett telling you about public investing or whether it's an experienced venture capitalist telling you about private investing… They'll all tell you, ‘It’s the people, stupid.’”

There are three qualities to look for in a partner: intelligence, energy, and integrity.

“You need all three. You can't compromise on any one of them. Otherwise, you'll end up with either someone who's not smart (which does you no good) or someone who's not hardworking (which also does you no good) or the worst case is you end up with a smart, hardworking crook who ends up working against your interests…”
Once you have a partner with all three traits, Naval recommends optimizing for control (if you decide to fundraise):

https://twitter.com/StartupArchive_/status/1725879846427840833

Brian Chesky on how to build strong cofounder relationships

“We [Airbnb cofounders] had a rule. The rule was that winning an argument was never more important than preserving the relationship. And the reason that's important is because if you start a company, you're going to have to debate a hundred thousand things... so no one argument can be the thing. There has to be this larger sense that we're a band.”

@bchesky likens strong relationships to exercise.

“I think you gotta really work hard at the relationship, almost like exercising. If you don't keep exercising, you get out of shape. We worked really, really hard. And one of the things we did in 2009 is we said every single Sunday we're gonna meet, no matter how busy we get, and to this day, we still do those calls.”

Constant contact, connection, and respect are critical.

“I think a lot of human connection requires constant contact, constant connection, a deep sense of respect, a sense that I'm only here because of them, a sense of humility and gratitude, and a sense that I'm never going to try to win. Because if I win alone, I'm not going very far.”

Follow @startuparchive_ for more tactical startup advice!
Is choosing a random cofounder a bad idea?

https://twitter.com/StartupArchive_/status/1720392954697699426