What’s the best way to navigate competitive forces?

Mark Zuckerberg (Founder & Chairman & CEO at Facebook)
How To Get Ahead: Entrepreneurial Lessons From Mark Zuckerberg

We had this concept that we actually still have in the company today, called lockdown. Which is — whenever any other company got ahead of us on something that we thought was strategic to us, we literally did not leave the house until we had addressed the problem. Now it’s a little looser of an interpretation. We don’t literally lock everyone inside the office, but about as close to that as we can legally get.

What’s the best way to build a good company?

Mark Zuckerberg (Founder & Chairman & CEO at Facebook)
How To Get Ahead: Entrepreneurial Lessons From Mark Zuckerberg

The most important thing for you as an entrepreneur trying to build something is, you need to build a really good team. And that’s what I spend all my time on… I spend probably 25 percent of my time recruiting, finding good people, both outside the company and inside the company, to put them in more impactful roles.

What’s the best way to navigate competitive forces?

Eric Ries (Author, The Lean Startup)
The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses

Sooner or later, a successful startup will face competition from fast followers. If a competitor can out execute a startup once the idea is known, the startup is doomed anyway. The reason to build a new team to pursue an idea is that you believe you can accelerate through the Build-Measure-Learn feedback loop faster than anyone else can. A head start is rarely large enough to matter, and time spent in stealth mode—away from customers—is unlikely… (read more)

Sam Altman (President at Y Combinator)
Startup Playbook

99% of the time, you should ignore competitors. Do not worry about a competitor until they are beating you with a real, shipped product. In the words of Henry Ford: “The competitor to be feared is one who never bothers about you at all, but goes on making his own business better all the time. “

Michael Porter (Professor, Harvard Business School)
The Five Competitive Forces That Shape Strategy

Deliberately choose a different set of activities to deliver a unique set of value or choose to perform activities differently than your rivals.

Michael Porter (Professor, Harvard Business School)
The Five Competitive Forces That Shape Strategy

To limit the threat of substitutes, offer better value through wider product accessibility. Soft-drink producers did this by introducing vending machines and convenience store channels, which dramatically improved the availability of soft drinks relative to other beverages.

Michael Porter (Professor, Harvard Business School)
The Five Competitive Forces That Shape Strategy

To neutralize supplier power, standardize specifications for parts so your company can switch more easily among vendors.

Michael Porter (Professor, Harvard Business School)
The Five Competitive Forces That Shape Strategy

To counter customer power, expand your services so it’s harder for customers to leave you for a rival.

Michael Porter (Professor, Harvard Business School)
The Five Competitive Forces That Shape Strategy

To temper price wars initiated by established rivals, invest more heavily in products that differ significantly from competitors’ offerings.

Michael Porter (Professor, Harvard Business School)
The Five Competitive Forces That Shape Strategy

To scare off new entrants, elevate the fixed costs of competing; for instance, by escalating your R&D expenditures.

Peter Thiel (Co-Founder & Partner at Founders Fund)
Peter Thiel’s CS183: Startup – Class 3 Notes Essay

In perfect competition, no firms in an industry make economic profit. If there are profits to be made, firms enter the market and the profits go away. If firms are suffering economic losses, some fold and exit. So you don’t make any money. And it’s not just you; no one makes any money. In perfect competition, the scale on which you’re operating is negligible compared to the scale of the market as a whole.

Mark Zuckerberg (Founder & Chairman & CEO at Facebook)
How To Get Ahead: Entrepreneurial Lessons From Mark Zuckerberg

We had this concept that we actually still have in the company today, called lockdown. Which is — whenever any other company got ahead of us on something that we thought was strategic to us, we literally did not leave the house until we had addressed the problem. Now it’s a little looser of an interpretation. We don’t literally lock everyone inside the office, but about as close to that as we can legally get.

Naval Ravikant (Founder, CEO & Co – Maintainer at AngelList)
“The Anatomy of a Fundable Startup”, by Naval Ravikant (Founder, AngelList) on Vimeo

[It’s] very rarely a case for a startup where a [competitor’s] patent becomes an issue unless you’re already successful.

Seth Godin (Founder at Yoyodyne Entertainment)
Seth’s Blog: What are you competing on?

What are you competing on? It’s pretty easy to figure out what you’re competing for—attention, a new gig, a promotion, a sale… But what is your edge? In a hypercompetitive world, whatever you’re competing on is going to become your focus.In any competitive market, be prepared to invest your heart and soul and focus on the thing you compete on. Might as well choose something you can live with, a practice that allows you to thrive.

Paul Graham (Co-Founder & Partner at Y Combinator)
Startup Investing Trends

We currently advise startups mostly to ignore competitors. We tell them startups are competitive like running, not like soccer; you don’t have to go and steal the ball away from the other team. But if idea clashes became common enough, maybe you’d start to have to. That would be unfortunate.

Dharmesh Shah (Co-founder and CTO of HubSpot)
Happy Birthday HubSpot! 9 Lessons From Our First 9 Years

Don’t obsess over competitors. Obsess over customers. I’ll confess. I’m likely more guilty of watching our competitors too closely than anyone at HubSpot. But, the good news is that though I watch them closely, I try not to follow them. Knowing what your competitors are up to is good. Doing what your competitors are up to is bad.

Clayton Christensen (Author, The Innovator’s Dilemma)
a16z Podcast: Disruption in Business… and Life by a16z | Free Listening on SoundCloud

We look at how many products are being sold [and by competitors]. What’s really interesting is the amount of non-consumption that’s going on. Because it hasn’t become more affordable or accessible for them yet. It’s too narrow to focus on consumption as opposed to non-consumption.

Fred Wilson (Co-Founder and Partner at Union Square Ventures)
Some Lessons From Vine – AVC

Once again, it appears that the category creating innovator isn’t hurt too badly when the bigger and more popular social platform copies their signature feature in their product. We have seen this before with Twitter and Facebook and Foursquare and Facebook and many other similar situations.

Clayton Christensen (Author, The Innovator’s Dilemma)
a16z Podcast: Disruption in Business… and Life by a16z | Free Listening on SoundCloud

Management goes on to believe that their product is about features. When you start up, you have an insight about a job that needs to get done. You respond to that passive data to develop a product. But then as a company goes on to be successful the nature of the data is very active. Management loses their insight about the job [that they help a customer accomplish] and now they believe their business is about products and features. Put out all of… (read more)

What’s the best way to make good decisions?

David Jackson (Founder, Seeking Alpha)
Don’t try to learn from failure | A Founder’s Notebook

Don’t try to learn from failure

Jerry Neuman (Venture Capitalist at Neu Venture Capital)
You Can’t Learn from Failure, You Can Only Learn from Success | Reaction Wheel

If you’re going to learn from failure you need to learn how to avoid every possible way you can fail. It’s a waste of your time. You only need to learn one way to succeed.

Mark Zuckerberg (Founder & Chairman & CEO at Facebook)
How To Get Ahead: Entrepreneurial Lessons From Mark Zuckerberg

Done is better than perfect’, ‘What would you do if you weren’t afraid?’…we’re a culture of very rapid innovation.

Ben Horowitz (Co-Founder & Partner @ Andreessen Horowitz)
How Andreessen Horowitz Evaluates CEOs – Ben’s Blog

In order to prepare to make any decision, the CEO must systematically acquire the knowledge of everything that might impact any decision that she might make. Questions such as: What are the competitors likely to do? What’s possible technically and in what time frame?
What are the true capabilities of the organization and how can you maximize them? How much financial risk does this imply? What will the issues be given your current product archite… (read more)

Slava Akhmechet (Founder at RethinkDB)
57 startup lessons

Make most decisions by consensus, but have a single CEO whose decisions are final. Make it clear from day one.

Mark Zuckerberg (Founder & Chairman & CEO at Facebook)
How To Get Ahead: Entrepreneurial Lessons From Mark Zuckerberg

There’s like 1000 things going on at any point in given time [at Facebook], and there’s like one or two that actually matter. You need to focus on those…

What’s the best way to evaluate a potential hire?

Claudio Fernandez-Araoz (Executive Board of Quilmes International, General Manager of the Quilmes Brewery)
21st-Century Talent Spotting

The first indicator of potential we look for is the right kind of motivation: a fierce commitment to excel in the pursuit of unselfish goals. We consider motivation first because it is a stable—and usually unconscious—quality. If someone is driven purely by selfish motives, that probably won’t change. We then consider four other qualities that are hallmarks of potential, according to our research: Curiosity: a penchant for seeking out new experie… (read more)

Jason Lemkin (Managing Director at Storm Ventures, SaaStr.com)
From the perspective of a CEO, what are the most underrated skills most employees lack? – Quora

Ownership. Most employees just can’t be owners. This may not matter at Adobe, or Google, or wherever. But up until you have 500 employees or so, the CEO is looking for owners. People that don’t just play a role, but truly own something, that make 100% sure it comes in ahead of time and ahead of expectations — with as little drama as possible.

Rachel Feintzeig (WSJ management reporter)
The Boss Doesn’t Want Your Résumé – WSJ

Bosses say blind hiring reveals true talents and results in more diverse hires. So-called “blind hiring” redacts information like a person’s name or alma mater, so that hiring managers form opinions based only on that person’s work. Companies invite job candidates to perform a challenge — writing a software program, say — and bring the top performers in for interviews or, eventually, job offers.

Ben Horowitz (Co-Founder & Partner @ Andreessen Horowitz)
The Right Kind of Ambition – Ben’s Blog

People who view the world through the me prism might describe a prior company’s failure in an interview as follows: “My last job was my e-commerce play. I felt that it was important to round out my resume.” Note the use of “my” to personalize the company in a way that it’s unlikely that anyone else at the company would agree with. In fact, the other employees in the company might even be offended by this usage. People with the right kind of ambi… (read more)

Ben Horowitz (Co-Founder & Partner @ Andreessen Horowitz)
The Right Kind of Ambition – Ben’s Blog

On the other hand, people who view the world purely through the team prism will very seldom use the words “I” or “me” even when answering questions about their accomplishments. Even in an interview, they will deflect credit to others on their previous team. They will tend to be far more interested in how your company will win than how they will be compensated or what their career path will be.

David Heinemeier Hansson (Partner at Basecamp)
The limits of trying to test people when you’re hiring | A Founder’s Notebook

The only reliable gauge I’ve found for future programmer success is looking at real code they’ve written, talking through bigger picture issues, and, if all that is swell, trying them out for size.

Basecamp (Basecamp is a project management tool that offers a variety of customer service options.)
This advice on how to get a job tells managers exactly what to look for when hiring | A Founder’s Notebook

When you’re hiring, seek out people who are managers of one. Whats that mean? A manager of one is someone who comes up with their own goals and executes them.

Alex Jumašev (Founder & CEO of Jitbit)
Startup hacks we learned in 2013

Instead of asking tricky interview questions trying to understand if someone is a good fit – hire them for a task after a very basic interview. And “friendly-fire” them in case they fail.

Ben Horowitz (Co-Founder & Partner @ Andreessen Horowitz)
How to hire senior executives for your startup | A Founder’s Notebook

Get backdoor and front-door references

David Jackson (Founder, Seeking Alpha)
Hiring millennials – what to avoid | A Founder’s Notebook

Great people don’t have a sense of entitlement. They’re prepared to roll up their sleeves to get stuff done. And because they succeed, they end up with better careers and far greater financial rewards than the people who feel entitled.

Dharmesh Shah (Co-founder and CTO of HubSpot)
Happy Birthday HubSpot! 9 Lessons From Our First 9 Years

Imagine you hired this person. Would you issue a press release to let the world know that you brought this awesome person on board? If so, you’re probably more focused on what they’ve done instead of what they will do for you. Don’t get me wrong, if you can get someone that’s a great fit and they’ve accomplished something in the past, and you think that’ll translate to doing great things at your company, go for it — and may the force be with y… (read more)

Laszlo Bock (SVP of People Operations for Google)
How to get a job at Google

The no. 1 thing we look for is general cognitive ability, and it’s not I. Q. It’s learning ability. [The second] is leadership — in particular emergent leadership as opposed to traditional leadership. What else? Humility and ownership.

Marina Janeiko (Developer at GitLab Inc)
What to look for when hiring someone to work remotely | A Founder’s Notebook

What skills or mindsets are you looking for when hiring for remote positions? People who write well, since most communication is written. People who are self motivated, since there is no one around to tell them what to do. People who are curious, because they tend to try things rather than sitting around and waiting for instruction.

Mark Zuckerberg (Founder & Chairman & CEO at Facebook)
How To Get Ahead: Entrepreneurial Lessons From Mark Zuckerberg

Over time, what I figured out was that the only actual way to let someone analyze whether someone was really good was if they would work for that person. (in essence “Would you want to work for this person?”)

Ben Horowitz (Co-Founder & Partner @ Andreessen Horowitz)
Is it OK to Hire People from Your Friend’s Company? – Ben’s Blog

[When considering hiring an employee from a friend’s company…] once the you become aware of the conflict between hiring the superstar employee and double-crossing your valued friend, you should get the issue onto the table by informing the employee that you have an important business relationship with his existing company and you will have to complete a reference check with the CEO prior to extending the offer. Let him know that if he does not … (read more)

Dr. Todd Dewett (Executive Coach)
Trial periods and deferring premium pay | A Founder’s Notebook

Use non-permanent initial employment. Defer premium pay. Instead, go market or submarket. Are you willing to pay top wages for top talent? Yes. Should you pay it before seeing what they can do? No.

Ben Horowitz (Co-Founder & Partner @ Andreessen Horowitz)
Is it OK to Hire People from Your Friend’s Company? – Ben’s Blog

A good rule of thumb is the reflexive principle of employee raiding which states: “if you would be shocked and horrified if company X hired several of your employees, then you should not hire any of theirs.” The number of such companies should be small and may very well be zero.

Ben Horowitz (Co-Founder & Partner @ Andreessen Horowitz)
Gaurav Dhillon 2.0 and His All New Integration Company – Ben’s Blog

In summary, one general rule of mine is don’t hire or fund rich people. The reason? Building a technology company is hard. It’s really frackin’ hard. Many of the tasks that you do when building one are no fun. When things go wrong as they always do, it’s no fun at all. Rich people tend to like to work on things that they enjoy, because if they don’t enjoy it, well, they are already rich. When the going gets tough, the rich get going . . . to thei… (read more)

Ben Horowitz (Co-Founder & Partner @ Andreessen Horowitz)
Hiring Executives: If You’ve Never Done the Job, How Do You Hire Somebody Good? – Ben’s Blog

Know what you want. [Avoid] hiring on look and feel, looking for someone out of central casting, and valuing lack of weakness rather than strength

Ben Horowitz (Co-Founder & Partner @ Andreessen Horowitz)
Hiring Executives: If You’ve Never Done the Job, How Do You Hire Somebody Good? – Ben’s Blog

The very best way to know what you want is to act in the role. Not just in title, but in real action—run the team meeting, hold 1:1s with the staff, set objectives, etc. In addition to acting in the role, it helps greatly to bring in domain experts.

Dr. Dana Ardi (Corporate Anthropology Advisors)
MBA Mondays: Guest Post From Dr. Dana Ardi – AVC

Winning contemporary workplaces stress innovation. They believe that employees need to be given an opportunity to make a difference – to give input into key decisions and to communicate their findings and learnings to one another.

Dr. Dana Ardi (Corporate Anthropology Advisors)
MBA Mondays: Guest Post From Dr. Dana Ardi – AVC

Avoid hiring only superstars. It’s about company teams, not just the individual. Sure, it’s totally tempting to create an All-Star team, but in case you hadn’t noticed, those people don’t pass the ball, they just shoot it.

Dr. Dana Ardi (Corporate Anthropology Advisors)
MBA Mondays: Guest Post From Dr. Dana Ardi – AVC

New hires are more than just the college or university they attended. In short, don’t hire credentials, hire people.

Fred Wilson (Co-Founder and Partner at Union Square Ventures)
MBA Mondays: Best Hiring Practices – AVC

Hiring is a process and should be treated as such. It is serious business. The first step is building a hiring roadmap which should lay out the hiring plan over time by job type. This should be built into your operating plan and budget. You want to be very strategic about how you invest your scarce resources into hiring and think carefully about when you need to add resources.

Ryan Howard (Founder @ Practice Fusion)
Transcript: Protecting yourself as the founder; Ryan Howard | VatorNews

The wrong leader – choosing the wrong leader can set your company back by more than a year. I’ve seen this first hand multiple times. Let’s take sales for example. It might take three to six months to hire someone, another three months to get them on board and that’s actually being quite friendly. On the life sciences front, I’ve had searches using professional search firms that take more than a year. It can be quite painful to find the right per… (read more)

Ryan Howard (Founder @ Practice Fusion)
Transcript: Protecting yourself as the founder; Ryan Howard | VatorNews

What I found over time is that definitively, they should be able to do the job, but in addition, they would have to be a culture fit. The reality is you’re going to spend more time with these individuals likely than your partner or spouse so you have to get along. It’s the only way that you’re going to build long term value together. Total assholes, again, will just ruin your culture. Whether other people admit it or not, people will quit because… (read more)

Mitchell Harper (Co-Founder & Board Member @ Bigcommerce)
28 things I’d do differently next time around — Medium

Assume all resumes are B.S. and back channel at least 5 people who worked with, for and above each candidate

Ryan Hoover (Founder at Product Hunt)
Blogging is the New Resume

Blogging is the new resume. Blogging is an effective way to illustrate expertise, personality, and most importantly, thought process. The way product managers, UX designers, and other “non-technical” roles think, communicates their ability and culture fit. Resumes lack this entirely…

Ryan Hoover (Founder at Product Hunt)
Startup Lessons Growing from 10 to 100 | Ryan Hoover

Hire people that intimidate you.

Ben Foster (Currently advising 10+ companies, 16 yrs PM/UX experience, VP Product at Opower, PM at eBay)
The Best Personality Type for Product Management – PM Rant

If I were forced to hire based on Myers-Briggs alone, I would hire my first Product Manager as an INTJ. Entire U. S. population: only 2. 1% is INTJ. eBay Product Management: INTJ accounted for over 50%

Ryan Howard (Founder @ Practice Fusion)
Transcript: Protecting yourself as the founder; Ryan Howard | VatorNews

Check references. I never check any references a candidate gives me, board or executive candidate. Go on Linkedin, do the due diligence, get the real data because if you don’t, you’re going to find out the hard way.

David Jackson (Founder, Seeking Alpha)
How to test job candidates for “learning agility” | A Founder’s Notebook

How good are the questions this person asks?

Seth Godin (Founder at Yoyodyne Entertainment)
Seth’s Blog: No direction home

Can you show me a history of generous, talented, extraordinary side projects?
Have you ever been so passionate about your work that you’ve gone in through the side door? re you an expert at something that actually generates value?
Have you connected with leaders in the field in moments when you weren’t actually looking for a job? Does your reputation speak for itself?
Where online can I see the trail of magic you regularly create?

David Jackson (Founder, Seeking Alpha)
Can you be a great business leader if you’re lazy? | A Founder’s Notebook

Clever and lazy people make good modern business leaders because they:insist on taking the time and space required to create, and to find new ways forward; are natural delegators; are always looking for simpler, easier ways to do things; focus on the essentials, and despise ‘busywork’. But perhaps a better description than “lazy” would be “always looking for scalable solutions which reduce brute labor and complexity”.

What’s the best way to build a good company?

Brad Feld (Managing Director at Foundry Group)
The Long Lost Myth of Capital Efficiency – Feld Thoughts

When a company can become cash flow positive on a small amount of capital (say $5m – $10m) and grow over 100% year-over-year without raising another nickel of equity, well that’s a silent killer.

David Jackson (Founder, Seeking Alpha)
Why capital efficiency is critical for SaaS and subscription businesses | A Founder’s Notebook

Capital efficiency gives you time, which is critical for businesses that scale steadily but without viral growth, such as SaaS and subscription businesses.

Sam Altman (President at Y Combinator)
Super successful companies – Sam Altman

They can explain the vision for the company in a few clear words. They generate revenue very early on in their lives. They keep expenses low. They are tough and calm. They make something a small number of users really love. They move fast.

Ben Horowitz (Co-Founder & Partner @ Andreessen Horowitz)
Why Startups Should Train Their People – Ben’s Blog

As success drives the need to hire new engineers at a rapid rate, companies neglect to train the new engineers properly. As the engineers are assigned tasks, they figure out how to complete them as best they can. Often this means replicating existing facilities in the architecture, which lead to inconsistencies in the user experience, performance problems, and a general mess

Sam Altman (President at Y Combinator)
The Post-YC Slump – Sam Altman

The main problem is that companies stop doing what they were doing during YC instead of relentlessly focusing on building a great product and growing, they focus on everything else. In general, startups get distracted by fake work. Two particularly bad cases are raising money and getting personal press. But the list of fake work is long.

Mark Zuckerberg (Founder & Chairman & CEO at Facebook)
How To Get Ahead: Entrepreneurial Lessons From Mark Zuckerberg

The most important thing for you as an entrepreneur trying to build something is, you need to build a really good team. And that’s what I spend all my time on… I spend probably 25 percent of my time recruiting, finding good people, both outside the company and inside the company, to put them in more impactful roles.

Sam Altman (President at Y Combinator)
The three steps to building a great company, and why most startups fail on the first step | A Founder’s Notebook

Task #1: Build a product that users love. Task #2: Figure out how you are going to grow. Task #3: Make sure you are going to stay a winner if you win. [Are the three tasks sequential? In other words, should you figure out growth only after you’ve finished building a product that users love? I think there’s overlap, but broadly speaking — yes, they’re sequential. ]

Dharmesh Shah (Co-founder and CTO of HubSpot)
Happy Birthday HubSpot! 9 Lessons From Our First 9 Years

As a startup, you need to seek that love. We don’t just want people to buy from us. We want people to love us. We want them to love what we love and respect what we do, even if they don’t buy from us. Even if they are unlikely to ever buy from us. Because what we believe is that the more people that love us, and want us to succeed, the more likely we are to do so.

Fred Wilson (Co-Founder and Partner at Union Square Ventures)
Long Roadmaps – AVC

And I replied that building a great company is a combination of patience and impatience in equal doses applied unevenly. Impatient short term, patient long term.

Paul Graham (Co-Founder & Partner at Y Combinator)
Beating the Averages

If you do everything the way the average startup does it, you should expect average performance. The problem here is, average performance means that you’ll go out of business. The survival rate for startups is way less than fifty percent. So if you’re running a startup, you had better be doing something odd. If not, you’re in trouble.

Tomasz Tunguz (Partner at Redpoint Ventures)
Why the Bubble Question Doesn’t Matter

1. Think long term 2. Manage your cash effectively 3. Only hire the right people 4. Mitigate churn 5. Raise capital opportunistically to amass a war-chest large enough to achieve your vision