"If the core people share a relevant and unique philosophy about something important, you’re onto something."

"Three salient properties that inhere in good company culture. First, a company must have very talented people. Second, they must have a long-term time orientation. Third, there must what might be called a generative spirit, where people are constantly creating."

"It is incredibly important to surface issues quickly. Ideally everyone in an organization is rowing in same direction. Ideally there’s a strong, shared vision of the company’s future. But at the micro level, details matter a lot. People will disagree about them often. When that happens, it simply must surface. Concealing disagreements because people feel uncomfortable makes for disaster. It doesn’t fix things. They just sit undealt with, doing damage."

"The standard view is that companies get destroyed by external competition. Maybe that’s true in the long run. But in the short run—and most that fail fail in the short run—they get destroyed internally."

"The best hires don’t seem to care too much about money at all. They might ask whether a certain salary is market or not. That is reasonable; no one wants to get screwed. But you want people to care far more about equity. And best hires aren’t wooed by an offer of a large number of shares. The best hires say “That’s the numerator. What’s the denominator?” The best people are the ones who care to ask: How much of the company is mine?"

"At Google, you’re a cog. Whereas with me, you’re an instrumental piece of this great thing that we’ll build together. Articulate the vision. Don’t even try to pay well. Meet people’s cash flow needs. Pay them so they can cover their rent and go out every once in awhile. It’s not about cash. It’s about breaking through the wall of cynicism. It’s about making 1% of this new thing way more exciting than a couple hundred grand and a cubicle at Google."

"We tend to massively underestimate the compounding returns of intelligence. As humans, we need to solve big problems. If you graduate Stanford at 22 and Google recruits you, you’ll work a 9-to-5. It’s probably more like an 11-to-3 in terms of hard work. They’ll pay well. It’s relaxing. But what they are actually doing is paying you to accept a much lower intellectual growth rate. When you recognize that intelligence is compounding, the cost of that missing long-term compounding is enormous."

"And since the best people tend to make the best companies, the founders or one or two key senior people at any multimillion-dollar company should probably spend between 25% and 33% of their time identifying and attracting talent."

"Many of our best people have actually come from the auto racing industry. These are startup-compatible people. They understand hard work, small teams, and deadlines. If your car isn’t ready come race time, you lose. And the rules change all the time, so they are used to redesigning engines year after year. Learning enough about the racing industry to recruit from it was kind of a challenge. But ultimately, we had some success by asking these amazingly talented people whether they really wanted to spend the rest of their lives making cars go around in a circle."

"one factor dominates all others. That factor is whether the founders are aligned with each other. This is key both in terms of structure and company culture. If the founders are in sync, you can move on to the rest of the equation. But if they aren’t, it will blow up the company. Nothing will work. This is why investors should and do focus so much on founding teams. Everything matters. How well the founders know each other matters. How they interact and work with each other matters. Whether they have complimentary skillsets and personalities matters. This set of questions is very important. Any fissures in the founding team will be amplified later on."

"people must either be fully in the company or not in it at all. As Ken Kesey said on his bus tour proselytizing LSD use in the ‘60s, “Now you’re either on the bus or off the bus.” Being part-time, holding other jobs, or bringing on consultants or advisors to do important work are big red flags because those arrangements are very misaligning."

"Founders need vesting schedules too. It’s not ideal to have founders who are fully vested from the outset. One founder might decide to quit. If he’s fully vested, the co-founder would be stuck working for 2 people. In practice, things are structured so that part of founders’ equity vests immediately. They might have 20-25% vest as credit for the work they’ve done up to the first round of financing. But the rest should vest over time."

"Roelof Botha: You can discover a lot about founders by asking them about their choices. What are the key decisions you faced in your life and what did you decide? What were the alternatives? Why did you go to this school? Why did you move to this city?"

"given power law distribution, you have to ask the question: “Is there a reasonable scenario where our stake in this company will be worth more than the whole fund?”"

"The power law distribution simply means you have to think hard about a given company is going to fall on the curve."

"But in terms of getting a good deal and not a bad one, it’s the same with any deal; the best way to get a good price is to have competition. VCs have to be competing to invest in you."

"succinct research. If you make or believe you need a 100-page document, you miss the forest for trees. You must be able to condense it into 3-5 pages. If there can be no succinct description, there’s probably nothing there."

"To be clear, it’s totally cool to have low aspirations. If you just want to make a $50m company, that’s great. Just don’t take venture capital, or at least don’t tell VCs about your plans!
Peter Thiel: It would raise a big red flag if you were to put a slide at the end of your deck that says you’re looking to sell the company for $20m in 18 months."

"If you’re doing something where you don’t need to move as quickly as possible, you might want to rethink taking venture funding. But if there’s any sort of winner-take-all dynamic—if there is a power law distribution at play, then you want VC. Giving up 25% of your business is worth it if it enables you to take over your industry."

"VC lets you borrow against future growth. You could wait until your revenues are high enough to fund x. But, if you’re good enough, someone will give you money to do x now. If there’s competition, you may need to do x quickly. So if you don’t screw things up, VC can often help you a great deal."

"Just as it’s a mistake to think that you’ll have multiple equal revenue streams, you probably won’t have a bunch of equally good distribution strategies. Engineers frequently fall victim to this because they do not understand distribution. Since they don’t know what works, and haven’t thought about it, they try some sales, BD, advertising, and viral marketing—everything but the kitchen sink."

"That is a really bad idea. It is very likely that one channel is optimal. Most businesses actually get zero distribution channels to work. Poor distribution—not product—is the number one cause of failure. If you can get even a single distribution channel to work, you have great business. If you try for several but don’t nail one, you’re finished. So it’s worth thinking really hard about finding the single best distribution channel."

"Marc Andreessen: The number one reason that we pass on entrepreneurs we’d otherwise like to back is focusing on product to the exclusion of everything else. We tend to cultivate and glorify this mentality in the Valley. We’re all enamored with lean startup mode. Engineering and product are key. There is a lot of genius to this, and it has helped create higher quality companies. But the dark side is that it seems to give entrepreneurs excuses not to do the hard stuff of sales and marketing. Many entrepreneurs who build great products simply don’t have a good distribution strategy. Even worse is when they insist that they don’t need one, or call no distribution strategy a “viral marketing strategy."

"even if media exposure wasn’t critical for customers or business partners, it turned out to be very important for investors and employees. Prospective employees Google the companies they’re looking at."

"One thing to learn is that managing people is different than managing managers. Managing managers is scalable. Managing people is not. Once you learn how to manage managers, you’re well on your way to be CEO."

"every great business is built around a secret that’s hidden from the outside. A great company is a conspiracy to change the world; when you share your secret, the recipient becomes a fellow conspirator." From Peter Thiel – Zero to One Chapter 8: Secrets | Genius

"A side note on invention and innovation: when you have an idea for a startup„ consult your network. Ask people what they think. Don’t look for flattery. If most people get it right away and call you a genius, you’re probably screwed; it likely means your idea is obvious and won’t work. What you’re looking for is a genuinely thoughtful response. Fully two thirds of people in my network thought LinkedIn was stupid idea. These are very smart people. They understood that there is zero value in a social network until you have a million users on it. But they didn’t know the secret plans that led us to believe we could pull it off. "

"It’s scarily easy to lose sight of the big vision. People are always tracking down the CEO and telling doomsday stories about how we’re all dead if we don’t change something to address competitor x. If you start to focus on doing everything, you’re just going to war without any clear vision, and you’ll fail."

"we think we have a good sense of the competitive and technological landscape. There are probably something like 200—so, to be conservative, let’s say 2000—people out there with the skills and enthusiasm to be able to execute what we’re going after."

markets
mimesis and competition
secrets
incrementalism
durability
teams
distribution
timing
financing
luck

To have a successful startup, you must have good answers—or at least a good plan for getting those answers—to all 10 of these points. And, to reiterate, you really do need all 10; 8 out of 10 is sort of a B-, and 5 of 10 earns you an F.

You can think of technology’s relationship with government as fitting one of three molds: being sold to the government, being subsidized by the government, or replacing the government.

Probably the best place to anchor in thinking about the future of energy is in the optimistic determinate quadrant. The key questions are the same as those for Internet businesses: What can be done that’s better and cheaper? Can you do more for less? That, of course, is the classic definition of technology.

The retrofuture idea is simply this: think about where the past failed, learn the right lessons, and make it work this time. But it’s important to resist just being pulled in by the iconic future of old. There’s no sense in making the same mistakes over again. The key is to approach old problems from a very different perspective.

The secret is in the "process. What enabled the Wright brothers to build the airplane wasn’t some secret formula that they come up with all of a sudden. It was rigorous adherence to doing carefully controlled experiments. They started small and built a kite. They figured out kite mechanics. Then they moved onto engineless gliders. And once they understood control mechanisms, they moved on. At the end of the process, they had a thing that flies. So the key is understanding why each piece is necessary at each stage, and then ultimately, how they fit together. Since the quality comes from process behind the outcome, the outcome will be hard to duplicate."

Peter Thiel: Is there a fear that you are developing technology that is looking for a problem to solve? The concern would be that AI sounds like a science project that may not have applications at this point.

Eric Jonas: We think there are so many opportunities and applications for understanding data better. Finding the right balance between building core technology and focusing on products is always a problem that founding teams have to solve. We do of course need to keep an eye on the business requirement of identifying particular verticals and building products for particular applications. The key is to get in sync with the board and investors about the long-run vision and various goals along the way.

"This course has largely been about going from 0 to 1. We’ve talked a lot about how to create new technology, and how radically better technology may build toward singularity. But we can apply the 0 to 1 framework more broadly than that. There is something importantly singular about each new thing in the world. There is a mini singularity whenever you start a company or make a key life decision. In a very real sense, the life of every person is a singularity.

The obvious question is what you should do with your singularity. The obvious answer, unfortunately, has been to follow the well-trodden path. You are constantly encouraged to play it safe and be conventional. The future, we are told, is just probabilities and statistics. You are a statistic.

But the obvious answer is wrong. That is selling yourself short. Statistical processes, the law of large numbers, and globalization—these things are timeless, probabilistic, and maybe random. But, like technology, your life is a story of one-time events.

By their nature, singular events are hard to teach or generalize about. But the big secret is that there are many secrets left to uncover. There are still many large white spaces on the map of human knowledge. You can go discover them. So do it. Get out there and fill in the blank spaces. Every single moment is a possibility to go to these new places and explore them.

There is perhaps no specific time that is necessarily right to start your company or start your life. But some times and some moments seem more auspicious than others. Now is such a moment. If we don’t take charge and usher in the future—if you don’t take charge of your life—there is the sense that no one else will.

So go find a frontier and go for it. Choose to do something important and different. Don’t be deterred by notions of luck, impossibility, or futility. Use your power to shape your own life and go and do new things."

#simplenote
#books
#work