Ben Horowitz (@bhorowitz) is a founding partner of superstar venture capital firm Andreessen Horowitz, and the author of NYT Best Seller The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers and his latest, What You Do Is Who You Are: How to Create Your Business Culture.
What We Discuss with Ben Horowitz:
- What the Haitian slave revolt can teach us about creating a thriving, resilient company culture from chaos.
- Why a company’s culture — for better or worse — will endure in the memory of the people who work there far longer than the consequences of a bad quarter.
- The disasters that strike when a company’s core values and culture reveal their dark side.
- How prison culture influences the way some billion dollar tech companies are managed.
- Ben’s possibly surprising musical preferences and how they fuel his own creative direction.
- And much more…
Like this show? Please leave us a review here — even one sentence helps! Consider including your Twitter handle so we can thank you personally!
Charting the course of a business toward certain success might seem simple to someone sitting on the docks, but the view’s a lot different from the captain’s quarters. The only thing you can count on is rough seas between here and where you’re trying to go, so you’d better assemble a crew suited for the task ahead — and the culture to ensure they’re as invested in getting to the other side as you are.
On this episode we talk to someone who’s assembled many crews and formed many company cultures: Ben Horowitz, cofounder and CEO of the venture capital powerhouse Andreessen Horowitz and author of New York Times Best Seller The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers and his latest, What You Do Is Who You Are: How to Create Your Business Culture. Listen, learn, and enjoy!
Please Scroll down for Featured Resources and Transcript!
On No Dumb Questions, a science guy from the deep south (Destin of Smarter Every Day) and a humanities guy from the wild west (Matt Whitman of The Ten Minute Bible Hour) discuss deep questions with varying levels of maturity. Give No Dumb Questions a listen here!
THANKS, BEN HOROWITZ!
If you enjoyed this session with Ben Horowitz, let him know by clicking on the link below and sending him a quick shout out at Twitter:
And if you want us to answer your questions on one of our upcoming weekly Feedback Friday episodes, drop us a line at firstname.lastname@example.org.
Resources from This Episode:
- What You Do Is Who You Are: How to Create Your Business Culture by Ben Horowitz
- The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers by Ben Horowitz
- Ben Horowitz at Twitter
- Andreessen Horowitz
- So Much Fun by Young Thug
- 4:44 by Jay-Z
- Port of Miami 2 by Rick Ross
- Uncle Ralph McDaniels Details 35 Years Of Making The Original Rap Video Show, AFH
- Ryan Holiday | Stillness Is the Key, TJHS 271
- The Black Jacobins: Toussaint L’Ouverture and the San Domingo Revolution by C.L.R. James
- The Haitian Revolution: History of a Successful Slave Revolt, ThoughtCo.
- Caesar’s Commentaries by Julius Caesar
- The Byzantine Generals Problem, SRI International
- The Louisiana Purchase, Thomas Jefferson’s Monticello
- Bushido: The Way of the Samurai by Tsunetomo Yamamoto
- The Bushido Code: The Eight Virtues of the Samurai, The Art of Manliness
- Genghis Khan, Ancient History Encyclopedia
- How a Door Became a Desk, and a Symbol of Amazon, The Amazon Blog
- Apple to Build New Campus in Austin and Add Jobs across the US, Apple
- In Coughlin Time, You Can Be Early and Still Be Late, The New York Times
- Waymo V. Uber: What You Need To Know About the High-Stakes Self-Driving Tech Trial, Fortune
- Uber Allegedly Hacked Rivals, Surveilled Politicians, and Impersonated Protestors, The Verge
- Reflecting on One Very, Very Strange Year at Uber by Susan Fowler
- Uber Has Replaced Travis Kalanick’s Values with Eight New “Cultural Norms” Quartz at Work
- Belief — An Interview with Oprah Winfrey, a16z Podcast
- Melanics: A Gang Profile Analysis, Journal of Gang Research
- Shaka Senghor at Twitter
- Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant by W. Chan Kim and Renee Mauborgne
- Regulatory Capture, Investopedia
- Dodd-Frank Wall Street Reform and Consumer Protection Act, Investopedia
- Khan Academy
- The Airbnb Founder Story: From Selling Cereals To A $25B Company, Get Paid for Your Pad
- Marc Andreessen at Twitter
- Internationalization (i18n), Angular
Transcript for Ben Horowitz | What You Do Is Who You Are (Episode 270)
Ben Horowitz: [00:00:00] Hi, this is Ben Horowitz and you're listening to The Jordan Harbinger Show.
Jordan Harbinger: [00:00:07] Welcome to the show. I'm Jordan Harbinger. As always, I'm here with producer Jason DeFillippo. On The Jordan Harbinger Show, we decode the stories, secrets, and skills of the world's most brilliant and interesting people and turn their wisdom into practical advice that you can use to impact your own life and those around you.
[00:00:22] I want you to see the Matrix when it comes to how these amazing people think and behave so that you can become a better thinker. And today a great thinker in his own right, founding partner of superstar venture capital firm Andreessen Horowitz, we've got Ben Horowitz here with us today, recorded on location here at the offices of a16z in Palo Alto, California. Ben has written a few excellent books and this latest one takes on historical events and turns them into business lessons, especially with respect to corporate culture. I know that that might sound a little bit like corporate speak here. But today we're going to explore what the Haitian slave revolt can teach us about running a business. We'll also learn how prison culture as discussed by a couple of Silicon Valley geeks, which is us by the way, influences how some billion-dollar tech unicorns are managed. We'll discover that culture and core values can actually have a dark side and we'll see how that dark side shows up and companies like Uber for example and can lead to some pretty big disasters. It's always fun to sit down with someone like Ben who's objectively been very successful and take a peek behind the kimono of what makes someone like him and the companies he invests in and helps manage tick.
[00:01:29] If you want to know how I manage to book guests like Ben Horowitz, I've got a crazy network and I want to teach you how to do the same. I'm teaching you how to do this in my free networking course, not enter-your-credit-card free, just free-free. It's at jordanharbinger.com/course. Most of the guests on the show, they subscribe to the course and the newsletter. So come join us and you'll be in great company. All right. Here's Ben Horowitz.
[00:01:53] I did notice, though, reading both books, you've got some street in you. You quote a little rap here and there, hip hop here and there, and I wonder, do you listen to that or was that something like --
Ben Horowitz: [00:02:03] You have to listen to that to know the exact right rap quote for the story that you're telling, but a lot of it actually is the kind of backwards of that. So I listen to so much rap music. A lot of the ideas I get for what I'm going to write come from the actual music itself. It's a little bit of a way of kind of giving credit where credit is due, just so it doesn't feel like I'm stealing it. It's expensive though, like licensing those lyrics for a book. It's not cheap.
Jordan Harbinger: [00:02:30] I didn't think about that. You got to call Jay-Z's people and be like, "Can I use this in a book about corporate culture?"
Ben Horowitz: [00:02:37] Yes, exactly. Not that it's expensive but like, the process is really complex.
Jordan Harbinger: [00:02:43] Yeah, talk about something that's right for disruption. You try to use a sample of music on a podcast, I mean, it's cheaper to hire someone to just remake.
Ben Horowitz: [00:02:51] Right, exactly. The song's got like 18 authors and then you know, the lawyers go after you, and then they charge you too much. The whole thing is just crazy.
Jordan Harbinger: [00:02:58] Yeah, it's unreal. What are you listening to? Like what's on your iPod or your phone that might surprise us?
Ben Horowitz: [00:03:04] Well the album that I'm listening to constantly now is the Young Thug album. I love that album. It's called So Much Fun. He really did an amazing job with it. So that's probably the number one thing. Of course, I'm listening to new Jay-Z album and Rick Ross album because I like those guys, but the albums -- if you're big fans -- are really good, but they're not -- the Young Thug album is like a truly special album, I think.
Jordan Harbinger: [00:03:30] It's not an entry-level. Is that kind of what you mean?
Ben Horowitz: [00:03:32] I think it's a little bit underrated as an artist. He put it all together. He's done a lot of good things in the past, but he put it all together on this one. It's really special.
Jordan Harbinger: [00:03:41] The reason I'm starting with this seemingly flimsy question is if there's some juxtaposition here that I think a lot of people don't really appreciate. It's really easy to look at somebody in the tech sector or investment sector and just be like, "These are some pretty square guys that only look at spreadsheets and are only looking at numbers all day," and that's not really what you do at all.
Ben Horowitz: [00:04:00] You know, I think I come from a different perspective. For one, I came up as an entrepreneur, not as a finance guy. I'm looking at it in that way. It's more of I'm looking at things more from a culture and a leadership perspective just throughout life, but hip hop from a cultural perspective -- and I talked about this in the book a bunch -- is a really great example of just the power of culture. Because you have this -- it started with parties in the Bronx and a very, very, very underground kind of thing and nobody in the music establishment thought it was a good idea. MTV didn't want to play the videos. The radio wouldn't play the songs. The record companies wouldn't make albums. There was literally no infrastructure to support it at all. Then the kids were all like they were all poor, they were all black, and so they're coming up and you go like, "Well, how are they going to succeed against the system?" And then you fast forward to 2019 you go, "Wow, this is the biggest musical art form worldwide by far." It's just wiped out all other music. It's that significant. So how did that happen? And when you go back and look at it, like a lot of it was the culture they had and there were a lot of elements in it, but the idea that you were going to create something from nothing, the idea that like you were going to get no help and you're going to figure it out. One of my favorite stories is Ralph McDaniels, who was like an early guy in hip hop, and nobody would play the videos, so he literally started a television station to play rap videos -- a television show called Video Music Box. And that kind of started the whole thing. And then he became uniquely famous because he invented the term "shout out," which everybody uses now. They were going to invent whatever they needed to get to the next phase. That was a cultural attitude and belief as much as it was anything else. There was no reason that it would have gotten so big.
Jordan Harbinger: [00:05:59] So you really are kind of like, listening to this music, kind of thugging in your car on the way to work?
Ben Horowitz: [00:06:04] In particular, the kind of era that I'm from in rap music is very entrepreneurial music, because they were all entrepreneurs because they had to be. There was no like, you couldn't go like, "Oh I got signed." There was no signing in rap, you know. What they rap about a lot is like, "How do you make it? How do you think about competing?" All the things that an entrepreneur thinks about. I'd say it's inspirational for the kind of work that I do.
Jordan Harbinger: [00:06:32] The new book uses history like the Haiti slave revolt and takes corporate culture ideas, and notes out of history, which is a really interesting way to look at corporate culture. Has anyone ever connected these kinds of things before? I've never seen it.
Ben Horowitz: [00:06:46] Not that I'm aware of. I will say this: people may like or not like the book, but you have not read a business book like this!
Jordan Harbinger: [00:06:53] Yeah!
Ben Horowitz: [00:06:54] That's for sure.
Jordan Harbinger: [00:06:55] Yeah, I read a lot of business books for the show, and a lot of people will take like, Ryan Holiday will take stoicism and put it into a business context or a modern context, but very few people are looking for like -- in fact, I don't even think I've ever even read about the Haitian slave revolt, ever.
Ben Horowitz: [00:07:10] Yeah, really interesting story, though.
Jordan Harbinger: [00:07:11] Yeah. Yeah. Where did you where do you find these? Were you just researching random historical bits and you went, "Ah there's an idea here," or did you get the ideas from culture -- ?
Ben Horowitz: [00:07:20] No, no. I would say this is my life's work. I got introduced to various things at different points in my life, but these were the things that influenced me most personally as a leader. Basically, the four stories that are in the book are the things that, as I try to learn how to create a culture change and so forth, that they were the most influential kind of leaders and thinkers for me. The Haitian revolution is just this unbelievably remarkable story which, unfortunately, not a lot of people know about. Where there had never been a successful slave revolt like, ever in the history of humanity, not just for the transatlantic slave trade or whatever, not the slaves of the Han Dynasty, not the Gauls that the Romans enslaved, like not ever, not nobody ever, like revolted and won until this slave army led by Toussaint L'Ouverture. They were up against like, crazy bad odds, because slavery in -- a lot of people who follow slavery know that this was probably the worst form of slavery in the history of humankind. That it was sugar plantations is extremely brutal, like more people died than were born, like all that kind of thing.
[00:08:38] The leader himself, Toussaint, was born a slave. He kind of came up in that but he was one, a genius, but more specifically a cultural genius. He mastered French colonial culture and then he mastered a kind of military culture, including from reading Caesar's commentaries. When he studied, he learned all of Julius Caesar's military techniques, but I think most importantly, because he was so kind of multicultural in his education, he knew kind of where the limitations of the slave culture he had were and it's very hard to make slave culture into military culture because slave culture, almost by design, is low trust. The problem with a low trust culture -- trust is about tomorrow. "I'm going to do something for you today because I trust that you will do it for me down the line." When you're a slave, there is no tomorrow; you don't own anything. Your family can be taken away from you at any minute. You can be killed on a whim. There's no long-term thinking in the culture. And so taking that and then trying to build an army out of it is very difficult because armies run on trust. Like, if I don't trust the command, then it's just chaos. Like it's the Byzantine Generals Problem. It's a very, very terrible way to try and take on like, Napoleon, which is what he did. He went through this amazing set of steps and techniques to change the culture, and the amazing thing, of course, was the army that he ended up with not only defeated the British, the Spanish, and the French under Napoleon, but the reports of what -- they were the most disciplined army. They were the one army that didn't rape and pillage. In fact, one of my favorite stories in the book is because he was changing the culture, he said, "Look, you can't rape, you can't pillage on the way because we're fighting for liberty, and you can't take away liberty and fight for liberty; they don't go together. We have to be focused on liberty," and that adjustment got him the support of the white women in the colony. They supported him over the white armies. They actually called him Father. That's how much they loved the guy.
[00:10:53] One of the greatest stories, which we don't know if it's apocryphal or not so I could put it in the book, but it's a great story. His name is Toussaint L'Ouverture, but slaves did not have last names, so he was born Toussaint. And Toussaint of the Bréda Plantation. But the story goes -- and Napoleon was obsessed with Toussaint. He suffered more casualties in Haiti than in Waterloo. So like if you can imagine that. He basically sold us 13 states for $15 million because he was so depleted by this war in Haiti, and he was obsessed with him and he was screaming at his generals one day and he said, "Look, how in the hell can you not catch this slave? How can you not defeat a slave?" And they said, "Well, you know, we get him backed up, we get him surrounded, and just when we think we have him, there's an opening." Toussaint L'Ouverture -- Toussaint the Opening, and so that's the story of the name.
Jordan Harbinger: [00:11:49] That's interesting. Yeah, hard and impossible, unfortunately [to prove] --
Ben Horowitz: [00:11:52] And I always think, "Why was there always an opening?" Because all the people on the ground were rooting for him.
Jordan Harbinger: [00:11:59] How often do you look to history when you're evaluating which companies to invest in or helping CEOs to manage and things like that?
Ben Horowitz: [00:12:06] You know, I think your life kind of comes from all of your experiences and particularly when it comes to culture. Toussaint for me is the big guidepost. But also, there's a great thing in The Bushido: The Way of the Samurai, which is "Keep death in mind at all times," and you go like -- that's the underpinning of the whole samurai culture is "Keep death in mind at all times." It's sort of the first rule. And you go, "Okay. Well that is a really weird rule because that doesn't sound like a very happy culture at all." It's hard to think about anything more miserable than thinking about dying all day. But what they mean by it is profound, and it's like, if you're going to do something, do it like this is going to be the last time you do it. Like if this was the last thing anybody saw you did, how do you want to be remembered? What should it be like? How do you think about that? And that, I think, is the most fundamental thing when you're talking about designing a culture, because you really want to say to your people, "Look, people 30 years from now aren't going to remember if we made the quarter. They're not going to remember if this product had a bug. They're not going to remember any of these things we're so focused on. They're going to remember -- we're going to remember -- "What was it like to work here? What was this time like of my life? What was it like for the people who touch us and do business with us? What was it like for them?" And that all comes from your culture and how you conduct yourself on a daily basis, so this whole idea of keep death in mind at all times, you can feel it even in Japan today, you know, you go there and people take tremendous pride in the very, very little things. They're doing it like it's their last time and that all comes from this idea from like 900 AD and the ancient samurai. A lot of the concepts, particularly when you think about organizations and leadership, they've been done before. Like, there's not a lot of invention here. But understanding what really worked over time, what lasted, what could actually move behavior is important.
Jordan Harbinger: [00:14:04] There's a thought exercise here. So, like the samurai who starts their days imagining what it would be like to die, you recommended in the book, or at least that's what I read, you're recommending doing the same thing with your company. You're going bankrupt. Let's say you're going bankrupt or the thought exercise is that you're going bankrupt: Was this a good place to work? Did people enjoy doing business with us? Were our partners happy? Did they think highly of us? Is our product of high quality? There's something useful there because I think a lot of people go, "Screw it. We've got to just cut every corner and get this thing done," or "We're going to burn these guys on this one, but we really need the money to do this other thing." And there is some short-term thinking in corporate governance.
Ben Horowitz: [00:14:41] Oh, yeah, there's a tremendous amount of short-term thinking and there's kind of like, "What are the people going to think of me?" as opposed to "Am I doing the right thing?" That's where it gets really screwed up, which is one of the reasons that this is actually why the Genghis Khan chapter, which is called Genghis Khan, Master of Inclusion, but I think that the thing that is bothering me a lot about the way people approach it today, it's like, "Well, what is The New York Times going to write about my numbers?" or "Are people going to call me names like racist and sexist?" and that's the basis for like how I approach the whole concept of inclusion, which is completely ridiculous and that you're going to, guaranteed, screw up your culture if you do it that way, like if you start from that position of perception or short-term gain or whatever as opposed to "What is this place going to be like to work if I'm coming from a different background than the people here already?" Just a real question. "Can we see the talent and can we bring it in, or are we just blind to it?"
Jordan Harbinger: [00:15:45] Yeah, you've mentioned that building a great culture means teaching the people or the culture to adapt to outside circumstances. The example you give, I think is, startups who want to sell to the enterprise, but then nobody wants to wear a suit, nobody wants to dress nicely, and so you need to bring in culture or executives from the outside who know the culture that you want to infiltrate, I guess, is the word for this?
Ben Horowitz: [00:16:06] Yeah. Yeah. Yeah.
Jordan Harbinger: [00:16:07] So how did those principles come from a slave revolt, for example?
Ben Horowitz: [00:16:12] That's a super great question. So maybe certainly unique among slave revolts in the kind of transatlantic slave trade era was Toussaint if you looked at his army, he had lieutenants from the French Army, the Spanish Army, so he would defeat his foes and he would not kill them. He did incorporate them into his own army. Actually in Haiti at the time, blacks and mulattoes didn't get along, so he would have blacks and mulattoes together and so forth, and the idea was he was like, "Look, if we're going to beat these guys, we've got to understand them. We have to understand their way of thinking. We have to adopt what they're great at and incorporate that into our stuff." And I think that if you're going to sell to Federal Express or The Home Depot or JPMorgan Chase, people in Atlanta and people in Memphis aren't the same as people in Silicon Valley. You have to understand those cultures if you're going to do business with them, and you're not trying to kill them like the way the --
Jordan Harbinger: [00:17:13] Yes, hopefully not.
Ben Horowitz: [00:17:14] You're trying to help them, but you can't help them if you can't communicate -- if you don't understand where they're coming from. The willingness to kind of adapt enough of their culture so that you understand it and can solve their problem, it's something a lot of entrepreneurs are unwilling to do and I think you see a lot of failure on that basis.
Jason DeFillippo: [00:17:32] You're listening to The Jordan Harbinger Show with our guest, Ben Horowitz. We'll be right back.
Jordan Harbinger: [00:17:39] This episode is sponsored in part by Xero. We've been using Xero for years here. It's cloud-based accounting software and we actually went after them to sponsor the show because Jen has been using this for a while. She loves it. It's super fast. It's intuitive. It's easy to use, even for people that hate the idea that they have to do accounting in the business at all. You can upload files, receipts, W-9 forms for your contractors. It's painless. It uses multiple currencies without any issue at all. A lot of our entrepreneur friends use it and it's kind of what the cool kids are using these days for accounting especially if you have an e-commerce or any sort of online component to your business. You can give access to an unlimited amount of users. You're not just sharing like accounting at jordanharbinger.com with every single person that might be logging into something which you know, you can imagine is a bad idea, and don't worry that's not my login for Xero. You can also pay by month. There's no contract. If you're a terrible manager and you go out of business in a few months, Xero is not going to come and try to collect on that amount because it's a month-to-month. So isn't that nice and you know, they wouldn't come and do that to either? They're going to be snarky like that. They're from New Zealand. So, they're very kind and they have 24/7 support, which is good because again, they're also in New Zealand, so who knows what the hell time it is over there. You can just screw everything up at 11 p.m. on a Sunday. You'll be all set by Monday morning in whatever time zone you're in and they have iPhone and Android apps so you can get your dashboard right on your phone. Jason.
Jason DeFillippo: [00:19:03] Try Xero risk-free at xero.com/jordan. That's zero with an X, X-E-R-O xero.com/jordan for a free month. You'll thank us later.
Jordan Harbinger: [00:19:13] This episode is also sponsored by Skillshare. They've been a sponsor for a while Jen and I love these guys. They are an online learning community Skillshare is with thousands of classes covering dozens of creative and entrepreneurial skills -- so photography, creative writing, design, productivity. You name it, it's in there. Whether you're trying to return to a longtime passion project, you're ramping up some hobby skills, or you're just trying to explore something new, Skillshare has classes for you. Jen took -- you know, she always gets mad when I mention this but I think it's a very illustrative of how much they have -- a bookshelf organizing class. There's Adobe Audition. Jason, what did you take in there? Was it like chess or piano or something or both? I can't remember now.
Jason DeFillippo: [00:19:54] I've been working on my musical skills, so I'm taking a slew of music courses including electronic music, piano, and all sorts of different stuff to get up my chops because I'm going to be the next Deadmau5.
Jordan Harbinger: [00:20:07] That's right. And they've got even things like how to solve a Rubik's Cube is in there, but you know web development and actual useful skills are, of course, in there too. Jason.
Jason DeFillippo: [00:20:15] Join the millions of students already learning on Skillshare today with a special offer just for our listeners, get two months of Skillshare for free. That's right. Skillshare is offering our listeners two months of unlimited access to thousands of classes for free. To sign up, go to skillshare.com/harbinger. Again, go to skillshare.com/harbinger to start your two months now. Once more with feeling, that's skillshare.com/harbinger.
[00:20:39] Thanks for listening and supporting the show and to learn more and get links to all the great discounts you just heard from our amazing sponsors, visit jordanharbinger.com/deals. Don't forget we have a worksheet for today's episode so you can make sure you solidify your understanding of the key takeaways from Ben Horowitz. That link is in the show notes at jordanharbinger.com/podcast. If you'd like some tips on how to subscribe to the show, just go to jordanharbinger.com/subscribe. Subscribing to the show is absolutely free. It just means that you get all the latest episodes downloaded automatically to your podcast player, so you don't miss a single thing. And now back to our show with Ben Horowitz.
Jordan Harbinger: [00:21:17] There's a great principle that can relate to any size business, which was: cultures always reflect the values of the leader. So you have to be the example of the culture in your own business. Basically, you have to walk the walk. That seems really obvious, but then when you read examples of people that haven't done that, you're just thinking, "Oh, wait, I've seen this everywhere all the time."
Ben Horowitz: [00:21:38] All the time, yeah. Nobody walks the walk a hundred percent. Like, everybody has slip-ups. But yeah, it's amazing how often people kind of deviate.
Jordan Harbinger: [00:21:48] Yeah. Yeah. Let's say you have a culture of punctuality -- is a really simplistic one, probably -- but you have to be punctual yourself, not always going to be there every time. Of course, sometimes you hit traffic on the way to the airport, but you have to build these values over time. You can't really, in many cases, just decide what they're going to be, yourself, and then try to get them. It seems like they happen based on the values of the leadership.
Ben Horowitz: [00:22:11] Yeah. This is a really important point I think, because if you bring in, whatever, the culture consultants and they go, "Well, like, let's have an off-site. We'll all get together and we'll brainstorm all the things we want to be, and then we'll have this long list of values, and then we won't adhere to them." Then our one cultural thing will be hypocrisy, because everybody will look at the values and go, "We don't do that." And a lot of the problem is, if you build a culture by consensus, then the leaders themselves may not even be willing to follow it. It's really a weird way to go about it. The correct way is a combination of who is the leader, and then what is the strategy of the organization, and does the culture support that strategy? As an example of that, you take Amazon and they've got like, cultural frugality is a big thing in that culture. And the reason it is is because they want to be the low-cost leader. They want to be able to underprice everybody on everything and that's been kind of a big strategy for a long time. They don't want to waste a lot of money in the company. Now, they did a lot of things. They used to have these desks that were actually doors that they just nailed some two by fours on to have legs. They're like, "We're not even spending money on your desk, that's how cheap we are!" You would never see Apple do that, because they're high design. Their campuses cost like $5 billion dollars or something and have super fancy doorknobs and all this weird stuff -- or beautiful stuff depending on your perspective -- and that's right for them. If you look at it, Apple's products will never be as cheap as Amazon's, and Amazon's products will never be as beautiful as Apple's. They have different strategies and different cultures that support those strategies. The idea that you just get together and have, like, some weird consensus brainstorm and come up with a culture is just bizarre. But that is how, I would say, probably more than half of companies go about it that way.
Jordan Harbinger: [00:24:04] Yeah, we hear about that all the time. I haven't worked in corporate for a really long time. But even back in my old law firm, it was like, "All right, we're going to have pizza in the conference room, and then we're going to talk about ethics and things like that." Then it's like, "Well, okay, didn't you just leave early with your mistress yesterday? Like, what are you talking about ethics? Come on."
Ben Horowitz: [00:24:22] That's a funny one. I mean, not a funny one. That's a sad one. Ethics itself, I think, has to be defined. I talk about it in the book. Uber has this value to do the right thing, period. It's like, well, what the hell does that mean? Like what is the right thing? I think that this is where Toussaint was so great because he got into so much detail on, like, what the right thing was and what ethics meant and I think that if you're going to have an ethical stance, you have to be extremely explicit about every aspect of what that is.
Jordan Harbinger: [00:24:53] It was either him or another example from the book where he said, "Look, if you're married, you can't have a mistress. Because if we can't trust you to keep your word to your wife that you did before a pastor or a priest or before God or whatever, then how's the guy standing next to you going to trust what you tell him?"
Ben Horowitz: [00:25:11] And that was so key, because one of the things he had to -- remember, from our earlier conversation -- that he had to overcome was this low trust. So how do you really establish that? Well you go like, "I'm not going to let you cheat on your wives." Okay, now in a military context that's very unusual. I mean even today, right? Like, we have a whole thing. I won't name names, but you know who they are. From that to, "I'm going to hold you to this rigid standard. I'm going to kick you out; you can't be an officer in the army." Why do that? And it's exactly as you said, it's like trust is paramount. That's the thing. Toussaint famously said, "I'd rather relinquish my command than break my word." Everything was like, trust was the foundation of how he got out of the weakness of slave culture and into the super-strong military culture that he built.
Jordan Harbinger: [00:26:01] Are leaders like this very explicit in the why? Like, did he say, "You can't cheat on your wife, and here's why," or did he just say, "You can't cheat on your wife," and then he knew why but nobody else did?
Ben Horowitz: [00:26:11] No, I think that the why is fundamental. And in almost any kind of cultural value, I'll just give you a quick example that we have one here. One of the really important things for us when we started the venture capital firm was, we have to respect the entrepreneurial process and what it means and respect the entrepreneur and how difficult that task is to build a company. But, like, everybody in venture capital says that. But nobody acts that way. They're like, "Oh, yeah, I'm a half-hour late to the meeting. I'm obviously more important than you and I don't respect you. Oh, I'm not going to do your deal. I'm not even going to tell you; I'm just going to ghost you." Like, you know, "F-off. I don't respect you." The whole industry protocol is very disrespectful to entrepreneurs, yet they all say that they're very respectful. So it's like this weird thing. And so I was really committed when we started to not doing that, because it used to drive me crazy as an entrepreneur. One of the things we put in place here was, if you're late to a meeting with an entrepreneur, the fine is $10 a minute. You've got to go to the bathroom? You're five minutes late? No problem. $50. And you're paying it right on the spot, and you're going to be embarrassed in front of everybody. Like, it's like that.
Jordan Harbinger: [00:27:18] Oh, wow.
Ben Horowitz: [00:27:19] And so you go, "Why would you do that, Ben? You're such an asshole," and yeah, may be true. But the key was the why. Because the rule was so shocking, people would ask, "Why? Why? I was doing an important phone call. I had to go to the bathroom. Why are you charging me so much damn money to like, go to work? Like, I'm working! I'm not at home," and the reason is because we're not going to waste a second of entrepreneur time, ever. Like, we're not going to do that, because that's why we're here. We have a respect for how hard it is to do what they're doing and we're not going to waste their time. And I want to tell that story. I want people to ask me why so that I can tell that story over and over and over again because it's so important, and that's what builds a culture is the why.
Jordan Harbinger: [00:28:07] That the why is what builds the culture versus just the rule, I think, is what a lot of people are missing when they do these off-sites or whatever. Because they go, "Oh, cool. We have this thing. We're going to make a list of ten core values and we're going to have an artist spray it on the break room wall," and then it's just literally decoration. That's it.
Ben Horowitz: [00:28:25] Exactly right. And one of the things I have in the book is Tom Coughlin with a similar shocking rule, but with a different meaning. He was like, "If you're on time, you're late," and like, he would fine people for being on time and thousands of dollars in his case. And even The New York Times was like, this guy's just like an abusive coach. Like these players, they're calling us and they're complaining because he's abusing them. And of course he won two Super Bowls, but you got into the why of it, like, we really care about the details of everything we do so much so that like if you're on time, you're late; if you're not doing your job exactly right, then it's wrong. And you know that whole thing made them just a very, very highly precise operation, which in football turns out to be really important. He created that culture that took them from a really horrible team to the Super Bowl team.
Jordan Harbinger: [00:29:17] You mentioned Uber before, and in that book, you actually say Uber is true to its core values, and it's like, "Whoa, what do you mean? They got in trouble for allegedly stealing Waymo documents!" I don't know if we're still using the "allegedly" word.
Ben Horowitz: [00:29:30] I think Levandowski actually got convicted.
Jordan Harbinger: [00:29:32] Yeah, so they stole the Waymo documents, so I'll cross "allegedly" off my list. They're hacking rivals in China. They were sort of like scamming rides in China and the US, I think, tricking competition. There's the Susan Fowler incident, which I believe is like a sexual harassment thing. And you said, "Hey, that's all culturally consistent." What do you mean by that?
Ben Horowitz: [00:29:51] Well, look, and I want to make sure I'm not misunderstood on this one. Travis Kalanick was a great CEO in almost every way, like one of the best CEOs we've seen in Silicon Valley in many years. And beyond that, like, he was really good at culture, like really good -- not like a little good -- really good. And if you read the Uber cultural values, they're super unique, they're very motivating, and they really adhered to it. But he had a bug in his code. Like if culture is a code, he had a bug, and that bug was really significant in that he had a giant emphasis on, I would say, competitiveness, ownership mentality, and these kinds of things. And so what that meant was "We're all about winning," and he had this thing he used to say, "Hashtag winning! We're going to win, and that's the most important thing. And then I'm going to give managers a tremendous amount of autonomy on how to do that." But he never said -- and this is the thing that was one of the keys to Toussaint -- was he never made the ethics or the limits explicit. That was just left unsaid. And so the way people ended up interpreting it was, "We can do whatever as long as we win," and if you look at every single incident that they had, almost every single one was driven by some competitive intention. "This is how we're going to win," and like, for example, the hacking the competitors' app actually was done to them first by DD in China.
Jordan Harbinger: [00:31:20] Right, I remember that.
Ben Horowitz: [00:31:21] Right. Like where that was okay, but because there was no like explicit instruction about whether that was okay or not, they just brought it back and did it here. If you go through it one by one from Susan Fowler to Levandowski to whatever, it was always about winning and with Levandowski, remember, Google was kind of attacking Uber. They were the partner of Uber's, but Uber got word they're going to launch a ride-sharing thing, and so it was a competition, and it was about winning. But if you don't have the line, and everybody's using their own judgment on that, that's where things got kind of wacky on them. I'll bet Travis learned from that and I'll bet that he'll be very successful in the future because he's a tremendously gifted, not only CEO, but he's tremendously gifted on culture. But it's very difficult, you know, like that little thing caused the whole thing to nearly unravel.
Jordan Harbinger: [00:32:15] Right, so it's almost like the AI example of where if you have the best paperclip-making AI, then it's like, if you just follow the rule to an extreme conclusion, now it's just dismantling humans to make more paperclips or whatever. It's culture as a code that has unintended consequences, potentially.
Ben Horowitz: [00:32:31] Yeah, and it often does. I mean, I think culture often has unintended consequences, and you don't want them to be fatal. That's key, and so you have to be really, really thoughtful about how you do them. And then you have to pay attention to it, and you have to change it when it's broken.
Jordan Harbinger: [00:32:45] A few of the cultural rules come from really unexpected places. Well, the slave revolt was unexpected for sure. But Shaka Senghor, who's this prison gang leader, I guess, for lack of a better word. He was really something.
Ben Horowitz: [00:32:58] Although, Shaka Senghor, we don't call them gangs in prison. We call them squads. Religious organizations.
Jordan Harbinger: [00:33:02] So he's a prison squad, religious --
Ben Horowitz: [00:33:04] He ran a squad called the Melanics.
Jordan Harbinger: [00:33:08] Yeah. So, how did you come across this guy?
Ben Horowitz: [00:33:12] It was like the weirdest story. So I was actually interviewing Oprah Winfrey. She was having an event out here and I was going to interview her for her the launch of a show she had called Belief. But like I'm interviewing Oprah, that's a scary task. That's like giving Albert Einstein a pop quiz. I was okay in physics. I said, "Oprah, can you give me a little lesson in interviewing before I interview you?"
Jordan Harbinger: [00:33:40] Why did she pick you if you go there and you're like, "Tell me five tips on interviewing!" What was the -- ?
Ben Horowitz: [00:33:46] Yes, actually the first tip was, she goes, "Ben, the first thing is don't have a list of questions and keep thinking or trying to memorize them, because then you're not going to ask the most important question, which is the followup question." I said, "I actually know that already; I've done enough interviews. I got that part. However, like what I really want to know is how do you ask these super aggressive questions and then rather than people being defensive, they just like burst into tears on these awesome interviews?" And she goes, "Oh, yeah, that one," and then you know, she got into this thing that you talked about earlier, which is, "I start by asking them what are their intentions? And then I tell them, 'I'm going to get you your intention, but you have to trust me.'" And I say, "Okay," and she goes, "Well, let me give you an example. Last week on my show Super Soul Sunday, I met this guy, 19 years in prison, seven years in solitary confinement, scary guy with dreadlocks, tattoos, big muscles." She's like, "So I'm interviewing him and I say to him, 'When did you get into crime?' And he says, 'Well, I hit the streets when I was 14 years old,' and she goes, 'Ben, but I had read his book, and so I didn't think that was right.' So I said to him, I said, 'Well, what about that time when you came home with straight As on your report card and your mom reacted by throwing a pot at your head?'" And Oprah says, "Well, he said, 'That didn't make me feel very good,' and he kind of tightened up, folded his arms." And she goes, "'How did that really make you feel?' And he said, 'It made me feel like there was nothing that I was ever going to do in life that mattered.'" And Oprah says, "You hit the streets when you were nine." "And we both start crying," she said. And I was like, "Oh my God, that's the greatest interview story I've ever heard in my life." So I run home, tell my wife. She's like, "Oh, that's a great story," and I didn't think anything of it. Next thing I know, my wife has friended him on Facebook.
Jordan Harbinger: [00:35:40] Shaka Senghor?
Ben Horowitz: [00:35:41] Yeah, I was like, "What are you doing?" I was like this guy's 19 years old, has killed people. He went to jail for a murder he did commit, not that he didn't commit. Then next thing, you know, she invites him over for dinner. And so, I'm like, "No, no, don't have him at the house. Let's have it at a restaurant down the street so we can get out of there in case he gets crazy!" But we have dinner with him. The craziest thing about it was I'm always talking to CEOs, and I'm always trying to learn things, and I'm talking to him and he is probably the most advanced CEO that I've talked to since Andy Grove passed away. Like it's like that. Then we listened to the same kind of music and whatnot. We ended up talking for like, seven hours that night. And we became friends. In learning his story and learning how he had to deal with prison culture and how he had to build the culture of the organization, I just thought, "Well, that is so interesting for the book because of the guys he has." Like in Silicon Valley, people come with a lot of cultural elements, like things that you would want, things that they've been trained on. The guys he got in prison, like ground zero. They were in prison because they came from really psychotic cultures, and so he could use almost nothing that they came with. So how do you build a culture from first principles? I'd say that's probably my favorite chapter in the book for that reason because it's just you read it and you go, "Oh my God, like how do you even function in this environment? Let alone create a culture, realize it's screwed up, and then change it and advance it?" And of course, he does all these things.
Jason DeFillippo: [00:37:15] You're listening to The Jordan Harbinger Show with our guest, Ben Horowitz. We'll be right back after this.
Jordan Harbinger: [00:37:21] This episode is sponsored in part by HostGator.
Jason DeFillippo: [00:37:23] It's 11 o'clock. Do you know where your website is? Looks like there's another outage at your target audiences' primetime. Costing you precious dollars every minute when it's down. It's a grim scenario that's played out daily across the globe to the frustration of small business owners like yourself and your customers. With web hosts as plentiful as the stars in the sky offering the park that prized domain within your modest budget, it's no surprise you're going to pick a few duds along the way. If you've entrusted it to anyone who's not been in the business of providing secure, efficient, simple and affordable web hosting services since 2002, it's anybody's guess as to why your site's down again. But if your website is handled by HostGator, one of the oldest and most trusted services on the Internet, it's up and running just like it should be. HostGator's 99.9% uptime guarantee and around-the-clock support ensure your website is available to the eyes of the world every day and night of the year. Got a tight budget. No worries. As long as you're a new user you get to try any HostGator package for up to 62% off the normal price, just for hearing the sound of my voice. And if you're not completely satisfied with everything HostGator has to offer, you've got 45 days to cancel for a refund of every last penny. Check out hostgator.com/jordan right now to sign up. That's hostgator.com/jordan.
Jordan Harbinger: [00:38:35] This episode is also sponsored by Manscaped. Support for the Jordan Harbinger show comes from Manscaped. Who's number one in men's below-the-belt grooming. They offer precision-engineered tools for your family jewels. And you know, when I first got the sponsor, I thought who's going to be that concerned about using an electric trimmer? Namely, The Lawn Mower 2.0 -- which is what it's called -- on their junk and Manscaped has really redesigned the electric trimmer. Apparently, it is a very popular product here and I can see why. Actually, it was really nice and it came off the packaging. It's heavy-duty for some of you who have all kinds of stuff going on down there. It's got proprietary SkinSafe technology, so it's not going to nick or snag your nuts. Manscaping accidents finally a thing of the past and you know what the thing is finally a thing of the past. Here's the thing, nobody is even as the guts to try these things because they're worried about a manscaping accident and so Manscaped is making sure that that doesn't happen plus don't use the same trimmer on your face if you're using on your balls, that's just that's nasty. There's got to be something wrong with that. I just don't want to go down that rabbit hole. Jason, I know you've experienced this in a positive fashion.
Jason DeFillippo: [00:39:48] Oh, yes. I trimmed for the summer and it was like having AC in your shorts. I am a firm believer in the lawn care diatribe that Manscaped is trying to get everybody on right now because it is a good thing for us to have nice and shorn friends for the summer.
Jordan Harbinger: [00:40:07] Yep, so what can they do to get a deal on some Manscaped.
Jason DeFillippo: [00:40:10] They can get 20% off and free shipping with the code Jordan at manscaped.com. That's 20% off with free shipping and manscaped.com and use the code Jordan. Your balls will thank you.
Jordan Harbinger: [00:40:22] This episode is not at all sponsored by me going to prison on my birthday. Not sure how to transition into that without being super awkward. So, there we are. I'm going to prison on the birthday February 26, 2020, and I'm bringing a bunch of you suckers with me. Hopefully, it's at High Desert State Prison in Susanville, California, which is near Tahoe, near Reno and it's a donation thing. All the proceeds are going towards an educational program for the inmates. I'm not keeping any of it. I promise. You're not even going to pay me. It's going to go directly to the group that's running this and the donation amount is approximately a thousand bucks. Give or take. We're going to see no kickbacks from me plus it goes to transportation. We're going to have some meals there's going to be a photographer there. It's just going to be a great thing for all of us. I've done this before not on my birthday, but I've gone to programs here. It's just I know everyone says their thing is life-changing. This really was something I thought about and still think all these months later and the price is priced to fund one inmate through the educational training program at Hustle 2.0. If you're interested and unique experiences and you want to come to prison with me, and I don't know 50 hundred other people on February 26, we're probably going to fly into Reno on February 25th. I'll send you the deets, just email me email@example.com. That's firstname.lastname@example.org. And I will send you some more info as it becomes available. I think it's going to be really fun. I'm really looking forward to it. We've got a lot of cool people in my circle coming as well. And I really am excited to meet a bunch of you show fans as well behind bars. I think it'll be a great time as weird as that might sound. So, shoot me a mail email@example.com if you're interested in joining us.
Jason DeFillippo: [00:42:04] Thank you for listening and supporting the show. Your support of our advertisers keeps us on the air and to learn more and get links to all the great discounts you just heard so you can check out those amazing sponsors, visit jordanharbinger.com/deals. Don't forget the worksheet for today's episode. That link is in the show notes at jordanharbinger.com/podcast. If you're listening to us in the Overcast player, please click that little star next to the episode. We really appreciate it. And now, for the conclusion of our episode with Ben Horowitz.
Jordan Harbinger: [00:42:33] I thought that this part of the book was worth the price of admission for the book, period. Like if it was just that chat. I thought it was incredible. One of the things from the book from that chapter, "You have to constantly examine and reshape your culture. Otherwise, it won't be your culture at all." That can't be any more true than in prison.
Ben Horowitz: [00:42:53] Yes, absolutely. Well, his first day in prison kind of shows that in that you know, he comes out of quarantine. In quarantine, there's six guys with him. They come out and their first day like in the rec hall, one prisoner walks up to another one with a shank, stabs him in the neck, the prisoner bleeds to death. Guy throws his shank in the garbage, goes to the chow hall and like, has a sandwich.
Jordan Harbinger: [00:43:18] Oh, God.
[00:43:19] And I was like, "Well, what did you think when he did it?" He said, "The first thing I thought is like, 'Can I do that?' because that's what you need to do to succeed here. Can I do that?" And I was like, "Well, you had killed a guy, so of course you could do that." He's like, "No, no, no." He's like, "What I did was I'm in a drug deal. The guy jumps out of the car when he's not supposed to and comes at me. I've got a gun in my pocket; I react and I shoot him. It was just a reaction. This guy took a two-liter bottle, filed it into a weapon, decides whether he's going to stab the guy in the stomach or stab him in the neck, wound him or kill him. Decides he's going to kill him, walks up to him, kills him. Then throws the thing in the trash, keeps on moving to the chow hall, and has a sandwich." He's like, "I couldn't do that." So I have to ask myself that question and I was like, "Well, that is a very intense form of new employee cultural orientation." Of course, that's going on in every company. You go into a company and you watch how the people who are succeeding behave, and whatever they're doing, that's what you're going to do. That becomes the culture. If you don't keep an eye on that, if you're not adjusting it, you get this super violent prison culture that we have in the United States.
Jordan Harbinger: [00:44:31] And if you walk into a company and someone gets stabbed in the neck with a shiv, get another job.
Ben Horowitz: [00:44:35] Yeah, or you'd better get your courage up! Exactly.
Jordan Harbinger: [00:44:40] That's right. Yeah, these guys, the Melanics, this squad that he was controlling. No drinking, work out every day, everyone had to fight for all the other guys. There were a few other rules, but those are the main ones, right?
Ben Horowitz: [00:44:51] Yeah, and he did a lot of work. I mean he trained him. He studied philosophy and trained them in philosophy, and a lot of that was to bond. Like, they had a unique common knowledge that defined them. And it was a super-powerful force in creating a culture. A lot of business leaders do that, where they, say, have their management team all read the same book and so forth, but it was that kind of thing. But he didn't just say, "Read this book," he was like, "Okay then we're going to have a training session on it." A lot of his guys couldn't read, so...
Jordan Harbinger: [00:45:21] Yeah, I really didn't think about that. So someone had to read to them and explain it to them.
Ben Horowitz: [00:45:25] Yeah, that's right. Exactly.
Jordan Harbinger: [00:45:27] Wow. Nothing like two white geeks talking about prison culture out here in Silicon Valley. Everything is being disrupted right now, like disruptions of buzzwords, it's not even exciting anymore for a lot of us. What are some areas that you think -- that are maybe top of mind -- that you think are ripe for this? Where is there some blue ocean? There's no forerunner that's yet emerged.
Ben Horowitz: [00:45:50] I think that the big categories of the economy that are right for disruption are financial services, which I think is the one that's happening at the fastest rate, and this goes to everything from all kinds of banking services, foreign currency exchange, real estate services. Anything in those categories is both pretty old and then technology hasn't been applied in a serious way. It's funny, my Gmail account is far more secure than my bank account.
Jordan Harbinger: [00:46:23] That's sad -- and scary!
Ben Horowitz: [00:46:25] It's bananas. That is the state of those industries, and a lot of it is regulatory capture, and they've been able to be slow and lazy on technology because there are no new banks, and so that kind of self that you have to be too big to fail, that was a big result from Dodd-Frank, so that's a big area. Another is healthcare and medicine, everything from diagnostics to drugs to just healthcare in general -- how it gets billed, how it gets allocated. It's massively just insanely inefficient and weird, and we're just now really being able to apply computer science techniques to biology because we now have an informational model of biology, not just a chemical model, but an informational model, and so you can start applying AI in these things to drug discovery and medical diagnosis. It's been amazing, the results that people are starting to get, so I think healthcare and medicine is probably number two. One of the most frustratingly tough nuts to crack that I think is coming is education. I mean, we still teach like we're getting people ready for the Industrial Revolution, including the bell. That was like in the factory, like, "Ding, ding, ding! Got to go to the next class!" It's so bananas, but you know, I think change is coming there too.
Jordan Harbinger: [00:47:42] Are there any industries that you think are immune to full software solutions? I mean, like retail. Are we all going to shop online from home, or is there something human about the shopping experience you think will always allow for brick and mortar?
Ben Horowitz: [00:47:54] Yeah, I mean, I think it's just going to change. I mean, I think that you know, these gigantic department stores that have pants in, like, 57 sizes. It doesn't make any sense anymore. You may have one pair in each size to try on, or whatever, or a tailor, like they just measure you, and you have one of each item and you can look at it and they can maybe virtually show how it looks on you. You don't even have to get in the pants and you don't have to worry about if like somebody before you didn't wear underwear or something like that, which we always assume. Whatever. I think there will be definitely live shopping and all that kind of thing, just like I think restaurants will persist despite the fact that there will be lots of things like virtual kitchens and all these kinds of things. But they're going to be different. The last set of retail was built for a completely different environment, so I think that everything going forward is going to assume that you have a supercomputer in your pocket and it's connected to the cloud, and there's a mass amount of information on everything from materials to pricing and this and that and the other, but I don't think it's going to go away. Human interaction is a wonderful thing and I think most people want it. Some people don't, some people don't.
Jordan Harbinger: [00:49:09] A lot of people in Silicon Valley could live without it.
Ben Horowitz: [00:49:12] Yeah. There are certainly a few here.
Jordan Harbinger: [00:49:14] You've said that good ideas look like bad ideas at the time. What do you mean by that? And how do we know which is which if everything looks like a bad idea?
Ben Horowitz: [00:49:25] I mean, the problem with innovative ideas is that they do look like bad ideas at the time. If an idea is a breakthrough, that means that people can't see it, and so that, by definition, kind of makes it look like maybe it's not a great idea when it happens. But of course, bad ideas also look like bad ideas. It's tricky to figure out which is which. The way we tend to distinguish this: Does the entrepreneur have a secret that they've earned? Do they know something about the world that nobody else knows -- or almost nobody else knows? And then, did they discover it through some process of hard work, and that's generally where innovative ideas come from.
[00:50:06] So for example, you know Brian Chesky at Airbnb, like if you heard that idea in the beginning, "I'm going to blow up an air mattress, stick it in my apartment, and rent it out." You'd go, like, "That's obviously a bad idea." I mean, what could possibly go wrong with that? People renting an air mattress in your apartment? That's going to be a catastrophe.
Jordan Harbinger: [00:50:24] And originally weren't they supposed to eat with us, too? It was like we were going to feed them breakfast?
Ben Horowitz: [00:50:29] Yeah. Well, the breakfast is a little more loose, but when you go through, "Why'd you come up with that idea?" Well, it turns out that he and his roommates wanted to go to the design conference that was in San Francisco. They didn't have the money to buy the tickets, but they knew that so many people were coming in for the conference that there weren't enough hotel rooms. So they said, "Why don't we rent out space in our room and then we can get tickets?" And it turned out that like 500 people called to rent that air mattress and so he had a secret about demand for this particular type of service. And then he furthered that secret by kind of researching hotels, and it turns out hotels have only been around for like a hundred years or so. And before that, there were inns and bed and breakfasts. Now the problem that hotels that Hyatt and Hilton solved was that you didn't know the quality. Like, it could be pretty weird; you go into some small town and there's an inn, and you don't know what the hell's in there. But Joe and Nate and Brian, they observed that with the Internet, you could rate every like room, air mattress, whatever, to a very fine grain of quality more so than even like the Pritzkers could do at the Hyatt. And so those two things combined made like a powerful secret, big enough off of which to build like a really gigantic company. And so that's a lot what we're looking for.
Jordan Harbinger: [00:51:56] I know we have to close in a little bit, so I wanted to ask about your partnership with Mark. You said, "He upsets me almost every day by finding something wrong with my thinking."
Ben Horowitz: [00:52:04] Yeah.
Jordan Harbinger: [00:52:05] "Partnerships have to be provoking enough to be productive," I think, is the way that you phrase it in the book. If it's too provoking, you can't get anything done. If it's too little, there's just no passion to motivate it.
Ben Horowitz: [00:52:15] Yeah, like if I'm not learning from him and he's not learning from me, then what's the value of the partnership? When you're old, anything you learn makes you angry, because you kind of thought you should already know it. I think that in a good working relationship, there's a lot of conflict, but you have enough trust where you can overcome the conflict. He and I have been working together now 24 years, so -- but it still gets me mad! Like there are days when I'm just like, "I'm going home, I can't take him anymore."
Jordan Harbinger: [00:52:43] For my last flimsy question, who decides how the names go in a partnership? Like, why is it not Horowitz Andreessen?
Ben Horowitz: [00:52:48] So we started, we had an angel fund before Andreessen Horowitz and it's called Horowitz Andreessen, which has a little better ring to it. It was funny. He wanted Horowitz Andreessen and I wanted Andreessen Horowitz once we created the firm. And the reason I wanted Andreessen Horowitz was, when we started, he was like, not a little more famous -- he's still more famous than me -- but he was a lot more famous than I was. And the biggest question we had when we were raising money is like, "Are you guys going to actually stick around and do this, or are you going to move on to your next venture?" And so, I was like, "Well, we have to put our name on the firm so people will believe that, and like, your name is the bigger question. Nobody really cares if I go as long as it's Andreessen capital, it would be fine. So we put his name first. And then the other dividend was that Andreessen Horowitz is impossible to spell, so you can't be your URL. So I came up with this idea that like, we would just do what we used to do when we were engineers in the '90s about internationalization, where we called it i18n. And so this was a16z, and A to Z is just way better than H to whatever.
Jordan Harbinger: [00:53:52] h2a. It's not backwards, we promise. Yeah. Well, this has been excellent. I do wonder why you dedicated the book to people coming out of prison. I thought that was really interesting. I do some work with prisons and I'm actually going for my 40th birthday to prison.
Ben Horowitz: [00:54:07] Yeah, well, it comes to kind of the last line in the Shaka chapter, which is you know, I say like, "So who is Shaka Senghor? Is he like a super thug from a gang leading murderer from prison? Or is he an upstanding citizen, New York Times bestselling author, super creative guy?" And the answer is both, right? What you do is who you are, and I think that we've come as a culture to this idea. That you can't be redeemed, that if you do anything, if you have a tweet from five years ago that you can't ever change and all this, you know, BS, and so I think it starts with people in prison who absolutely can change and what you do is who you are, not like what you did when you were 17 years old to get yourself into prison. And so I really wanted to reach out to people on the inside and let them know that, at least you know, for me, I could see that. When we do this book tour, we're definitely going to have a few prisons on the list that we can go visit. And that's really what it's about. It's about like, if you change your culture, you change yourself, you change who you are, and that's as an individual or as an organization.
Jordan Harbinger: [00:55:16] Thank you very much.
Ben Horowitz: [00:55:17] That was great. This was fun. Thank you very much.
Jordan Harbinger: [00:55:19] Yeah, this is a lot of fun. Big thank you to Ben Horowitz for having me out to the offices of Andreessen Horowitz a16z for those of for the cool kids here in the seen. His new book is titled, What You Do Is Who You Are: How to Create Your Business Culture. We'll link to that in the show notes as we always do. There's a video of this interview on our YouTube channel at jordanharbinger.com/youtube. And, of course, there are worksheets for every episode including this one, so you can review what you've learned here from Ben Horowitz. That's at jordanharbinger.com in the show notes along with transcripts, which we now have for each episode. Those can be found in the show notes as well.
[00:55:58] We're teaching you how to connect with great people such as Ben, manage relationships using systems and tiny habits, that's our Six-Minute Networking course, which is free over at jordanharbinger.com/course. Don't kick the can down the road. You cannot make up for lost time when it comes to relationships and networking. I know you think you're going to do it later. You got to dig the well before you get thirsty. Once you need relationships, it is too late to make them, seriously. I found that out the hard way myself. Don't make the same mistake. The drills take a couple of minutes a day. I wish I knew this stuff 20 years ago. You can find it all for free at jordanharbinger.com/course. By the way, most of the guests on the show, they subscribe to the course and the newsletter, so come join us, you'll be in a smart company. Speaking of building relationships, you can always reach out and or follow me on social. I'm at @JordanHarbinger on Twitter and Instagram.
[00:56:45] This show is created in association with PodcastOne. This episode was produced by Jen Harbinger and Jason DeFillippo, edited by Jase Sanderson, show notes and worksheets by Robert Fogarty, music by Evan Viola, and I am your host, Jordan Harbinger. Our advice and opinions and those of our guests are their own. I'm a lawyer but I'm not your lawyer, so do your own research before you implement anything you hear on this show, and remember we rise by lifting others. The fee for the show is that you share it with friends when you find something useful or interesting which should be in every episode. I certainly think this one makes the cut. So, please share the show with those you love and even those you don't. In the meantime, do your best to apply what you hear on the show, so you can live what you listen, and we'll see you next time.
[00:57:30] A lot of people ask me which media and podcast I listened to and, of course, I love that YouTube channel Smarter Every Day and while he's not like shooting lasers through water like shooting holes in iPhones, Destin who I have with me here is doing his podcast No Dumb Questions. Destin, you had some episode recently that really struck my fancy. I can't wait to check it out. It's about internet manipulation. And of course, we've got sea, air, land warfare, but cyber as other people have heard on the show as well is that's the new domain and it's not just hacking and stealing information. There's more going on here.
Destin Sandlin: [00:58:00] Yeah. It's the fifth domain of warfare and I know you did a whole show on that. Who is your guest on that one?
Jordan Harbinger: [00:58:06] That was Richard Clarke. Yeah, so he was in the White House dealing with this and I know you sort of touched on this with a general who's maybe more towards the front lines.
Destin Sandlin: [00:58:14] Yeah, I did an episode called The Future of War. I used to work for the army full-time and I was testing missiles in the Pacific and I interviewed him and he explained the fifth domain to me. And so that really piqued my interest. Because of the YouTube connections, I was able to go to Google, to Facebook headquarters, into Twitter's headquarters and speak to the people that are over the trust and safety groups at these different companies, which they gave me crazy access. The fact that I was able to go have these conversations with them as a super big deal to me and I learned a lot of crazy stuff about how these platforms are being attacked for two reasons mainly one for financial gain. These are just people trying to make a quick buck or the more nefarious stuff is people who want to actively manipulate society by using these algorithms against us which is fascinating, but we did a whole episode on that on No Dumb Questions called the Internet Manipulation.
Jordan Harbinger: [00:59:09] The podcast is called No Dumb Questions. It's about internet manipulation. We'll link to that episode in the show notes for this episode and, of course, you can find No Dumb Questions the podcast anywhere you find your podcast. Thanks, man.
Destin Sandlin: [00:59:21] Thanks, man. I really appreciate that.
Sign up to receive email updates
Enter your name and email address below and I'll send you periodic updates about the podcast.