Lenny's Podcast: Product | Career | Growth
00:02:20 · Keith Rabois, Lenny Rachitsky
[00:02:20] S0: Yeah. So when I started working at Square, Jack Dorsey was running the company off an iPad. And so I immediately converted in September 2010 and haven't looked back. I haven't touched a computer since September 2010. Everything I do in my life is either done from my phone, my watch, or my iPad. [00:02:37] S1: What's so interesting about this as you were talking is just there's this trend of engineers starting to code from their phone, at Boris Cherny on and Simon Willison, these two engineers that are 10X engineers, and they're just coding from their phone talking to AI. And I feel like you've been preparing for this for a long time. [00:02:52] S0: Yeah. I'm trying to be ahead of the curve. Jack's very good at being ahead of the curve. If you just watch what Jack's doing and follow, you're in pretty good shape in technology. [00:03:00] S1: And just to understand the benefit, is it just avoid distractions? [00:03:03] S0: Yeah, partially distractions, partially just the flexibility. Taking an iPad with you anywhere is just super easy. Some laptops have improved since then, but the screen flexibility, angles, but just the weight. I carry my iPad with me everywhere. There's nothing you can't perform unless maybe if you're doing heavy duty engineering, which obviously has not been my forte in life, although I may have to start. There's no reason to use a more powerful, heavier weight, less flexible machine. [00:03:34] S1: Wow. iPad Maxing, Keith Rabois.
00:03:36 · Keith Rabois
[00:03:36] S0: See if you got my Apple. As long as it's an Apple product, it works. Well, let's start with first principles. The most important lesson I learned when I was working at Square from my board was Vinod Khosla was on my board, and he said, "The team you build is the company you build." And that adage is the most important thing when you're creating a startup. People get distracted with the market, with customers, with a product, with technology. Ultimately, it's the team. If you have the right people, everything else will be easy and you have the wrong people, everything else is going to be difficult. So, Vinod distilled it, but I actually learned this back on my PayPal days. So in the early 2000s, why was PayPal so successful? Why were there subsequent generations of successful, interesting companies for 25 years now? It's because Peter Thiel and Max Levchin marshaled an incredible density of talent. So it allowed PayPal to succeed where possibly we wouldn't have. And these people went on with interesting ideas, ambition, and talent to build epic companies in all kinds of verticals. So from day one, day one of my technical career, technology career, I've always been focused on the importance of critical density talent, how do you identify, retain, and promote people with that talent? Back in the PayPal days, when I first started my career in technology, I actually truthfully was not very good at this. Fortunately, Peter and Max were. So Max basically hired all the technical talent in the organization. Peter pretty much hired everybody else. They used their network primarily. So it was very difficult to get a job at PayPal, unless you had a first degree or second degree connection to the engineering team or to Peter through Stanford. Which is a different type of recruiting model. It works really well if you have a strong network. I wouldn't recommend it for everybody, but if you have a network that has unique talent, there's no substitute. Interviews are not a great substitute regardless of how strong you are at interviewing. But when I started my career, I was mediocre at let's say hiring people, probably 50/50. Some good people, some mediocre people. That doesn't allow you to scale a team with an unfair advantage. But what I learned to do is steal people from other people's organizations within PayPal very successfully.
00:06:45 · Keith Rabois
So I got feedback from David Sacks, who was the COO at the time that I wasn't going to get promoted again until I could demonstrate leverage, leadership leverage, which he had an equation for of one plus one has to equal three or more. So for every incremental person you hire, you have to show that you produce disproportionate returns, non-linear returns. And because I wasn't hiring that well, I wasn't really succeeding at that leverage. So when I went around, took the feedback into account, I said, "Okay, I really want to get promoted. What do I do?" So I found people within the organization that I felt had talent that were not being leveraged to the highest potential inhibition, and I recruited them to my team. And that was very successful. And then I did get promoted actually fairly quickly because these people actually left to speed. They were able to run really fast and we produced a lot of really important results for the company. The lesson though that I took away was, well, that's great because what it showed to me is I actually could identify talent. I just couldn't identify strangers with talent. So people that were in the building that I have lunch with or dinner with or go for a runaround the PayPal campus with, I was accurate at diagnosing their abilities. I just couldn't do it in a 20-minute, 30-minute, 45-minute interview. So the first thing is just double down on people I know. That doesn't scale perfectly, but learn to be excellent at, if I had context, assessing people's abilities, superpowers and weaknesses. Then over the next X years, tried to identify a different technique for identifying, assessing random people. Because ultimately if you're going to build an organization, ultimately if you're going to be a VC, you can't just invest in people that you already know. So that took some years and required some training. Anyway, I think you can teach some of this to a founder, but one advantage a founder has that's going to thrive is if a founder shows the ability early in his or her career to assess talent ruthlessly and accurately, here's how you can go very far with no other abilities whatsoever. Hiring is like a muscle. You need to exercise it. You need to try, learn what worked, what didn't, what could you have known, what did you miss, why, and riff on that and try to get better at it. There are tactics you can learn.
00:09:57 · Keith Rabois, Lenny Rachitsky
I think the tactics work pretty well within the middle of a bell curve distribution of moving yourself 10, 20 degrees within that bell curve. I don't think the tactics can really teach you how to identify, call it top 10 basis points, top 50 basis points of talent. There you have to deviate from the norm. And I think that's actually true of most lessons in life. If you're going to be extraordinary in any skill, you can't follow a playbook. Otherwise, by definition, lots of other people would be the top 10 basis points, but you can get a lot better by learning techniques. So for example, let's share a couple. One thing I think you can learn to do is be excellent at references. It doesn't work for hiring people right out of college or something because the reference context is going to be a little off, but I think without getting better at interviewing and assessing, if you just learn to extract the right information from ruthless referencing. So for example, ruthless referencing to me means Tony at DoorDash does 20 references on every single senior hire, 20. [00:11:24] S1: Wow.
00:11:25 · Keith Rabois
[00:11:25] S0: I bet you he's pretty good and that he's been pretty accurate too. So I think you can learn that. That's a skill that's teachable, that being absolutely incredibly dedicated to your craft, you can just get better at. Back in the day, there's an investor at Greylock who's on my board at LinkedIn, David Sze, very successful investor, notable for both LinkedIn and Facebook investments. He used to teach at Greylock, you couldn't stop referencing a founder until you hit a negative reference. So you would know you had exhausted the reference when you finally hit a negative reference. And so I think there are tactics there in muscle building. How do you get the right information from the right people? How do you frame the questions, et cetera? That will lead you in the right direction. Now, you have to be careful, let's say, I'll give you an example where this can go wrong. I've been a longtime investor from the seed round of a company called Faire, founded by two of my colleagues at Square, Max Rhodes and Jeff Kolovson worked for me at Square and then the two other co-founders also worked at Square. When people were reference checking Max, often most VCs asked the wrong question, which was, "Was Max a good employee?" The answer to that is very mixed. And so some venture capitalists, including some very good ones, were nervous about investing in Faire. If they frame the question slightly differently, which is, "Is Max capable of being a world-class entrepreneur?" the answer was yes. So again, it's a tactic you have to understand, what exactly am I trying to extract? Same person, wrong question, wrong result. And many people passed on Faire and they regret it. And these are actually quite talented investors. They just didn't frame the question correctly when they were calling someone like Jack Dorsey up for the reference.
00:13:17 · Lenny Rachitsky, Keith Rabois
[00:13:17] S1: Any other questions you find really helpful in extracting the right information? [00:13:20] S0: When I interview candidates for senior people in leadership positions, I always ask them, look at whatever company they're at and say, "If you were CEO, what would you have done differently?" And you get a feel for their strategic mindset of can they drive value creation? Because almost by definition, they've come from a company that's had some traction success, so can they edit? So in your case, I would've asked you, "If you were CEO of Airbnb, what would you have done differently?" And you learn a lot from that question. On references specifically, I think a general arc that's pretty good is asking the person, what would lead to this person being most successful? And if something were not to work out, what would be the primary root cause that you can identify if something going wrong? I think generally probing on those two arcs leads to a lot of insight. [00:14:10] S1: And that first question is for the candidate or is that in the reference? [00:14:14] S0: Yeah, for the candidate. That's for the candidate specifically. [00:14:16] S1: Got it.