The great venture capitalist Ben Horowitz wrote last night about how the investors in his own startup once told him they wanted a real CEO. What struck me about the essay, which was mostly about how Andressen Horowitz helps founding entrepreneurs develop into great leaders, was Ben’s striking response to the insult: he acknowledged the investor was right, that he didn’t have the resources or skills of an experienced CEO.
None of us do, but it’s hard to admit. When, as a founder of Plumtree, I was told by our investors that they wanted a “real executive,” I thought they were simply wrong, discriminating against me because I was young, because my suits didn’t fit, because I never belonged to a fraternity. I thought about what they owed me for the past two years of blood, sweat and tears, not the performance I had to deliver over the next two years.
The difference between my reaction and Ben’s got me thinking what a miracle it was that I survived at Plumtree, and now how I’ve managed to last this long as a first-time CEO of Redfin, which I joined when it was only a few people in an apartment.
It certainly wasn’t because I knew what I was doing. And this is true of Redfin’s entire executive team. Almost all of the executives I work with today have been at Redfin for five years or more. And none of us five years ago had the skills to do the job we were hired to do.
This was mostly because anyone who had those skills would never have worked for Redfin in its early days: Redfin’s website was a Flash-based application that used its own hand-stitched map rather than Google’s, it was fully available in only one market, we had a few hundred thousand dollars in capital, and we were competing for people’s attention with national, richly funded businesses run on open platforms by some of the best entrepreneurs I’ve ever met, at Zillow and Trulia.
Naturally, seasoned executives ran in terror from us. But the Redfin team prospered because of two basic traits:
- We worked hard
- We wanted to learn
The second trait is most important. When I was nearly fired at Plumtree, I was working very, very hard. But mostly I worked hard at proving that I already knew what I was doing. This convinced everyone that I wasn’t interested in learning, and it often made me feel like a fraud; whenever I learned something, I pretended I knew it all along. Our chairman, the great investor Pierre Lamond, liked to say that “I didn’t even know what I didn’t know.”
And this is what he told me when he said I was fired.
I begged Pierre for mercy even though I knew he had a reputation for being Ming the Merciless. And the begging embarrassed him so much he looked away. Somewhere in my blubbering, I said “I’ll learn.” For the first and perhaps the last time in his life, Pierre relented. If I hadn’t got a second chance, I’d probably be a mid-level systems consultant sleeping in a Milwaukee Holiday Inn right now.
These days, it’s very fashionable to keep entrepreneurs around as executives. That’s a good thing. But what’s even better is that this has allowed entrepreneurs to be open about what they want from investors, which is the time and space to learn. If you want to learn, you can learn. And if you work 16 hours a day rather than eight, you can learn twice as fast.
Just make sure you’ve got a Pierre, or a Ben, behind you, and maybe a mentor like John Kunze or Bill Campbell too.