‘Good Decision Making Is for the Strong’
LinkedIn founder and Silicon Valley visionary Reid Hoffman, in conversation with Tina Seelig, shared his insights with the Stanford community at the inaugural Distinguished Lectureship from the Stanford Initiative for Entrepreneurs’ Resilience and Well-Being (SIER), a collaboration between STVP and Stanford’s Mussallem Center for Biodesign. In opening remarks, Alan Yeung, Li Ka Shing Professor of Cardiology in the School of Medicine, spoke of the importance of exploring resilience as a component of entrepreneurship. “SIER put together a spotlight on resilience as the capacity to adapt, recover, and grow stronger from stress and adversity. Our initiative is designed to bolster entrepreneurial responses to hardships, [to] turn challenges into unique opportunities for growth and innovation.”
As a visionary and industry pioneer, Hoffman offers a unique perspective on sustaining an entrepreneurial mindset through failure, born of real-world experimentation. Hoffman shared advice for entrepreneurs about taking on challenges, managing the lows, and building resilience. Here are some highlights the talk. Find the full discussion at the SIER website.
On Resilience
“It’s not resilience like, ‘How can I work a 40-hour week?’ The question is, when you are working as hard as you’ve worked in your life, how do you navigate and endure? It’s not, go do 50 mental pushups, but, what are the kinds of things that allow balance and making good cognitive decisions? Good decision making is for the strong. How do you build in that sense of presence, that network around you, how you handle challenges? How do you make sure that it’s the hardest you have ever worked but in a sustaining, resilient fashion?”
Advice for New Entrepreneurs
“Build your network. One is your personal network: Who are the people you can talk to about the difficulty of this? Because you will go through, not just your company, will go through ‘valley of the shadow’ moments…
“The second thing may be a bit of somewhat atypical advice for building these companies. Frequently you’ll get from professional organizations, “Don’t hire your friends.” The reason is you don’t want to put the stresses of the startup on the friendship. And that’s a real thing….On the other hand, these are people that you’re spending 80 to 100 hours a week with, and you are much happier if these are people that you feel like you want to be talking to on Saturday morning, even if you have some disagreements about how this specific game is working, that you have a respect and trust for each other. Try to build not just an intentional culture around your company, but try to build a culture of general friendship.”
On Taking Risks
“I’m probably amongst the most intentional risk-takers of people you run into, because I typically think within a business strategy or a personal strategy that taking an intelligent risk that other people don’t take is a competitive advantage. I’m specifically identifying risks that I think will wave off competitors or have them make the wrong decision that, if I’m right about, gives me a real edge.”
What the Bottom Is Made of
“The fully optimistic view is the trampoline…but I think it’s actually those kids’ castles where you have all the little balls in them and you’re thrashing around…. A ball pit.”
How to Handle the Low Moments
“Have a plan Z. What happens when it doesn’t work? What can you do? And what’s your regroup plan? …Ultimately what you most want to be able to do is play again, almost serendipity. If you can keep playing again, you’re maximizing your chance at serendipity. That’s one.
“Two is, when you’re doing the risky things around founding a company, joining a company, you’re thinking about: ‘What’s my thesis about why, my theory of the game, why this company might work?’ I’m updating it as we’re going. That’s again, the plans A, B, and Z. I’m talking to other people about it. It may be lots of people. It may be a few people. It may be a couple people that you are at work with. It may be a couple of people who are advisors to you or the company or something. I think that’s really useful.”
On the Importance of Building a Network
“That it’s not purely lonely, that you have people that are with you on this very stressful journey, I think is quite important…because you want a certain esprit de corps. The work that we’re doing matters. One of the aphorisms that’s used in the Valley is – and it’s partially true, like most aphorisms – missionaries build huge companies and mercenaries build medium companies. It’s that shared mission of what we’re doing here that matters in the world, because then that causes a, ‘Look, if we failed, we failed at trying to do something that was really important.”
