Published in 2014, Ben Horowitz’s The Hard Thing About Hard Things is a business management classic. It brims with insights into the unforgiving world of startups – the trials and tribulations that come from running one. Horowitz tells stories from the once-fabled days of the dotcom boom and the dark, harrowing falls of the bust.
He solves the riddles VCs pose and gives founders clear signals for when it’s time to sell. He also teaches how to assess senior executives and CEOs. Organization design, communication strategies, recruitment processes – Horowitz lays it all bare.
The core premise of this book is helping readers build a business when there are no easy answers. It’s packed with practical advice from Horowitz’s days as the founder and CEO of companies like Loudcloud and Opsware. These insights are gold for entrepreneurs navigating tough times and seeking a way forward.
This book isn’t some fluffy management theory from a consultant who’s never made a hard choice. It’s frontline reporting from a founder CEO. Someone who has been to war and suffered losses. Someone who made life-or-death decisions and still found a way to win.
For some, the raw, brutal truth in the book will be uncomfortable. For others, it’s exactly the kind of guide they’ve been waiting for.
Early in life, I learned that you can’t solve every problem. That’s where this book begins, with a sharp rebuke of typical business books.
“The problem with these books is that they attempt to provide a recipe for challenges that have no recipes. There is no recipe for really complicated, dynamic situations.” – Ben Horowitz
I want to review this book differently. This won’t be the typical rundown. Instead, I’ll focus on the key takeaways because that’s where Horowitz’s wisdom hits hardest. I also believe that The Hard Thing About Hard Things qualifies for the Lindy Effect. This book will stand the test of time.
Takeaway#1 – The Secrets of a Successful Partnership
Marc Andreessen and Ben Horowitz have been in a tango for close to three decades now. In the book, he talks about how the two to this day continue to work as a successful duo. The key to working with a co-founder is to push each other while staying on the same path. Challenge each other, but don’t create unnecessary tension.
“Most business relationships either become too tense to tolerate or not tense to be productive after a while. With Marc and me, he upsets me almost every day by finding something wrong in my thinking and I do the same for him. It works.” – Ben Horowitz
Takeaway # 2 – Finding the Right Investor
The dot-com crash of the early 2000s sent investors into a tizzy. Raising money was like sneaking Mona Lisa out of the Louvre. Amidst all the fear, Horowitz raised $120 million. The proof of concept was not wasting time on the noise. You find the one who sees what you see, who nods and says yes. That one is all you need.
“The most important rule of raising money privately: Look for a market of one. You only need one investor to say yes, so it’s best to ignore the other thirty who say no.” – Ben Horowitz
Takeaway # 3 – The Right Kind of Friends
Horowitz speaks about Bill Campbell (ex-Chairman and CEO of Intuit), also known as ‘The Coach’ in Silicon Valley. Campbell shared this wisdom while helping Horowitz and the team prepare for what analysts called ‘The IPO from Hell.’ He emphasized that having the right people around you can make all the difference during challenging times.
“No matter who you are, you need two kinds of friends in your life. The first kind is one you can call when something good happens. You need someone who will be more excited for you than he would be if it had happened to him. The second kind of friend is somebody you can call when things go wrong. When your life is on the line and you have only one phone call.” – Ben Horowitz
Takeaway # 4 – Overcoming Adversity
After successfully taking LoudCloud public during the shaky dot-com climate, Horowitz’s troubles did not end. Business was on thin ice, major clients were leaving, and the stock price slipped to $2. Yet, against all odds, Horowitz not only survived the shitstorm but also managed to sell the company to EDS for $63.5 million.
“If you are going to eat shit, don’t nibble.” – Ben Horowitz
Takeaway # 5 – The Role of Focus and Resilience
“What’s the secret to being a successful CEO? Sadly, there is no secret, but if there is one skill that stands out, it’s the ability to focus and make the best move where there are no good moves.” – Ben Horowitz
Horowitz credits his resilience to the Japanese art of Bushido. In the book, he quotes Miyamoto Musashi: “Keep death in mind at all times. If a warrior keeps death in mind, he will conduct himself properly. Living as though each day might be his last helps him ensure his actions are appropriate.” Similarly, a CEO should maintain the proper focus when hiring, training, and building his culture.
Takeaway # 6 – Adapting to Shifting Waves
“Technology businesses tend to be extremely complex. The underlying tech moves, the competition moves, the market moves, the people move. As a result, like playing three-dimensional chess on Star Trek, there is always a move.” – Ben Horowitz
Horowitz stresses that building a technology business is like surfing on shifting waves. You can’t be complacent because every part of the ecosystem is in flux. Just when you think you’ve got a handle on it, the goalposts shift.
Take Tesla, for instance. They started with electric cars, but the competition caught up fast. So, they made the next move – expanded into energy storage with Powerwall, and then pushed for autonomous driving. Tesla was already working on the next frontier when others focused on catching up in EVs.
Takeaway # 7 – Handling Tough Decisions
“Once you decide that you will have to lay people off, the time elapsed between making that decision and executing that decision should be a short as possible.” – Ben Horowitz
Horowitz further elaborates on firing senior executives, emphasizing that the entire process should be one of respect. Avoid placing undue blame on an executive. If you belittle the executive, you’ll put other senior execs on tacit notice. At least, that’s how they will perceive it. And make sure you tell the employees yourself, instead of handing off the tough conversation to HR. Employees want to hear from the top guy, not through the grapevine.
Takeaway # 8 – Importance of Being a Good Company
“Being a good company doesn’t matter when things go well, but it can be the difference between life and death when things go wrong. Being a good company is an end in itself.” – Ben Horowitz
This takeaway highlights that a company’s values and ethical foundations are critical during challenging times. When things are going smoothly, even mediocre companies can survive. But when crises hit, only the companies with strong principles and solid leadership come through intact.
Horowitz argues that being a good company is essential when times are tough. It’s essential for survival. In challenging times, the loyalty you’ve built will hold the company together. Trust and culture are crucial – without them, it might crumble.
Takeaway # 9 – The Power of Training
“Training is, quite simply, one of the highest-leverage activities a manager can perform.” – Ben Horowitz
Take the example of Google. It invests heavily in leadership training for managers through its “Project Oxygen” program. A small improvement in how managers handle their teams leads to better decision-making. This overall improves team performance. The gains from training your employees are far-reaching.
Takeaway # 10 – Right Kind of Ambition
Horowitz, while delineating the guardrails for selecting the best senior executives, provides valuable insights. One of his generals during Opsware days was his VP-Sales, Mark Cranney. He talks about how Cranney, unlike other candidates, rarely mentioned his own role in closing big deals. Instead, he focused on how his team worked together to get it done. For many CEOs, what Horowitz proposes might sound counterintuitive.
“While interviewing candidates, it’s helpful to watch for small distinctions that indicate whether they view the world through the ‘me’ prism or the ‘team’ prism.” – Ben Horowitz
Takeaway # 11 – The Product Comes First
Horowitz takes a blunt view of culture. This can be at odds with what “culture-first” advocates often promote. For founders, his focus is clear. Build a product that is 10x times better than that of your nearest competitor and then, take the market aggressively.
“If you fail to do both these things, your culture won’t matter one bit. The world is full of bankrupt companies with world-class cultures. Culture does not make a company.” – Ben Horowitz
On this count, I’d partly agree with Horowitz. Yes, the Product comes first. Yes, Culture is not the leading edge. Without a great product that fits the market, culture alone cannot save a company. But if you do have an awesome product, culture can become a critical, accelerating factor in your growth.
Takeaway #12 – Managing Scale and Hiring Executives
Horowitz writes about managing scale at a startup, particularly when it comes to hiring executives. He calls this the “Scale Anticipation Fallacy.” He specifically warns against hiring senior talent too early in the company’s growth. He also cautions against buying into the narrative of hiring superstar executives. Here’s his pearl of wisdom:
“There is no such thing as a great executive. There is only a great executive for a specific company at a specific point in time. Mark Zuckerberg is a phenomenal CEO for Facebook. He would not be a good CEO for Oracle.” – Ben Horowitz
Takeaway #13 – The Harsh Realities of Being a CEO
“If you don’t like choosing between horrible and cataclysmic, don’t become CEO.” – Ben Horowitz
Great CEOs face the pain. If you are not up for anxiety and stress, don’t aim for the CEO’s position. Be happy with a less demanding role. Many executives take on CEO roles just to add the title to their LinkedIn, but they lack the chops. One of Horowitz’s friends calls the CEO role “torture.”
Takeaway #14 – Peacetime and Wartime CEOs
Recently, I have read a lot of posts online focusing on peacetime and wartime CEOs, and what sets each apart. Horowitz believes there is a time when each type of CEO can excel. If a company is on a growth path and its shareholders are happy, then a peacetime CEO will do. But if a company is going through death throes—a total existential crisis—then a wartime CEO needs to step in. In my opinion, this theory does have merit.
“My greatest management discovery through the transition was that peacetime and wartime require radically different management styles. Interestingly, most management books tend to be written by management consultants who study successful companies during their times of peace. As a result, the resulting books describe the methods of peacetime CEOs.” – Ben Horowitz
Takeaway #15 – When to Sell the Company
Horowitz saves the key discussion of when to sell the company for the end. Having experienced many ups and downs himself, his advice on this topic is solid. Many founders struggle with the timing of when to sell. Horowitz gives founders a clear framework.
“The judgment you need to make is: a) Is this market significantly larger (more than ten times) than what has been exploited to date? b) Are we going to be the market leader? If the answer to either question is no, then you should consider selling. But if the answer to both is yes, then selling would mean undervaluing yourself and your team.” – Ben Horowitz
Conclusion
The Hard Thing About Hard Things is not for the faint-hearted. It’s for the ones willing to roll up their sleeves, to fight tooth and nail when there’s no guarantee of victory.
Ben Horowitz doesn’t sugarcoat the journey. He has walked it. He knows the weight of making decisions that no one else wants to make. He knows the fear that grips you at 3 a.m. when the stakes are life or death for your business. He gives you the unvarnished reality of leading when the odds are stacked against you.
The value of Horowitz’s book lies not in easy solutions but in the lessons forged through adversity. If you’re looking for comfort or a formula, look elsewhere. It is a guide for those who want to build, who want to endure, and who know that the hard thing is sometimes the only thing that matters.
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