“Pick the offer and pick the opportunity where you’re going to learn the most.” — Marissa Mayer

This past August, former Yahoo CEO Marissa Mayer, who now serves as the Co-Founder and CEO of startup Lumi Labs, joined thousands of STEM interns from Silicon Valley at AT&T park for Internapalooza 2018. She shared her advice on how to make the right decision when choosing a job, why she chose Google over 13 other opportunities and more.

Here is Marissa’s keynote address during Internapalooza 2018:

32 - MARISSA MAYER: Internapalooza keynote (former CEO of Yahoo and #20 employee at Google)

[00:00:05] Marissa Mayer: Pick the offer and pick the opportunity where you’re going to learn the most.

[00:00:13] Host: This week’s episode is a bit different. Every summer I host a large STEM student gathering called Internapalooza. Thousands of interns from all over the Bay Area, and New York City attend. Over 20,000 STEM students have attended in the past. This year, Marissa Mayer was one of our keynote speakers. Marissa is well known for formerly serving as the president and CEO of Yahoo and being the 20th employee of Google. She recently co-founded a new startup called Lumi Labs, early stage technology incubator. In this week’s quick episode, we hear Marissa’s keynote talk at Internapalooza.

[00:00:53] Announcer: She needs no introduction. Our final speaker is one of the most admired tech executives in Silicon Valley, Marissa Meyer. She is currently running Lumi Labs, an incubator in downtown Palo Alto, focused on consumer media and AI. It’s run out of the old Google office, the same place she began her career in 1999. Before that, she served as CEO of Yahoo for about five years, beginning in 2012 and ending with the company’s sale to Verizon.

Prior to joining Yahoo, she spent 13 years at Google where she was the 20th employee and influenced many of the company’s successful signature products. Relevant for our purposes today, it’s worth noting that when she chose to join Google, she was weighing 14 different job offers. We’re incredibly lucky to have her here with us tonight. Please, join me in welcoming Marissa Meyer to the stage.

[00:01:43] [applause]

[00:01:48] Marissa: Thank you. I’m really excited to be here at Internapalooza. I thought I would tell the story that corresponds to the introduction, the weighing of the 14 job offers and all that, but I also say this year’s summer has actually been a lot of deja vu for me because I’m back in the old Google office where I started my career 19 years ago. I was sitting where all of you were 20 years ago, because I was finishing my internship during my master’s, I did a two-year master’s and an internship in between. About a year later, I had to make a decision about what company I wanted to go and join. I think the broad headline that I would say is, pick the offer and pick the opportunity where you’re going to learn the most.

My background, it was 1999, it was the height of Web 1.0, the bubble was huge. Company was IPOing, worth billions immediately. If you were graduating computer science or interested in technology, you could get as many job offers as you wanted to get. Ultimately, I got about 14, made a sport of going and getting all these offers. I got offers for a lot of different opportunities — some to teach like at Carnegie Mellon, teaching programming because I had done that at Stanford, big tech companies like Oracle, lots of little startups, consulting, research firms, all kinds of different companies.

At the end of it, I could pick the best of each type of job offer. I knew if I was going to a big company, I’d go to Oracle. I knew if I was going to a startup, it would be Google. I knew if I was going to go teach, it would be Carnegie Mellon.

I had a really hard time deciding across fields. How do you take things that are so different and weight them together? I thought about a lot of different decisions that I had made and were there things across those decisions that they all had in common. I sat down, wrote a list of decisions I was really happy with that I had made. They included going to Stanford, changing my major to symbolic systems, doing one internship at SRI down in Menlo Park, doing another internship at the Union Bank in Switzerland, in Zurich.

When I looked across all those different decisions, they had two things in common. One, I always surrounded myself with the smartest people I could find. Two, I always did something I was a little not ready to do, where at the end of the first day I would sit down on my back and be like, “What was I thinking? Why did I think this was a good idea?” When I looked across those different job offers, that was really what set the Google offer apart. I loved Larry and Sergey, I loved their vision for how search could change the world. I loved the fact that they had made this amazing jump from being Stanford PhDs who didn’t shower, ate pizza for breakfast, rollerbladed all the time, didn’t apologize when they ran into you on said rollerblades.

They had made this amazing journey to being businessmen who had a vision of how search could change the world and the company that they wanted to lead. I was also really impressed with some of their first employees, like Craig Silverstein, who to this day is one of my closest friends, who’s just one of the smartest people that I’ve ever met. I just knew that by going to Google and working alongside people like that, it ultimately would challenge me to think harder about things, achieve more and work on problems that were going to have a bigger impact.

The other thing, this notion of doing something you’re not ready to do. You want to push yourself. I think that’s really what it comes down to in terms of learning. Larry and Sergey from the very beginning would say, “We want to build a Fortune 500 company.” In honesty, I thought that they had about a 2% chance of succeeding. I gave all the other startups a 0.2 chance of succeeding.

Overall, the fact that they wanted to try and do that, the fact that Google, the name itself now is almost a punch line in terms of jokes, I can imagine my father saying, “Yes, when Marissa graduated from Stanford, she went to this company called, get this — it had this silly name of Google.” I knew that weighing it alongside of other things — One of the other opportunities I really thought a lot about was McKinsey for consulting. I knew that I would be very good at consulting. I didn’t know if I’d be a great software engineer and I wanted to challenge myself if I went to Google, to see what kind of software engineer I could be.

I also have the observation, having had friends work at McKinsey — McKinsey, the problem is that, when I was talking to a lot of my friends, they would make a presentation, they would have an idea for the changes that should be made in the company, and they’d make their presentation, their recommendations, and then they’d leave. Then, all the executives that they presented to would stay there and ultimately make the decision.

I realized, as glamorous as it was to go to McKinsey and get to go and give advice to Fortune 500 CEOs, CIOs, et cetera, I would learn a lot more going to Google and trying to build a Fortune 500 company, even if we failed, than I would giving advice to them, because I would actually get to be in the room where those decisions get made, and understand how do you decide to go after a big deal? How do you decide to change your hiring process? How do you decide how to advance your product strategy? Being in those meetings, I think, is much more valuable and the type of learning you’ll get.

If you look at those two tenants and principles, they really are about learning. You learn more from having smart people who challenge you all around you. You learn more by doing things that you don’t feel completely ready and prepared to do. I would just really encourage that when you’re looking across different opportunities, you try and take the one that you’re going to learn the most from. I would also say that, from that, also don’t feel pressure to pick from an obvious set opportunities.

There’s certain times in your life where you can do a very specific thing. In particular, going to be almost the opposite of Peter Thiel here, but decide “Wait, I want to go for more education, I want to go and do graduate work, I want to stay in school longer.” That’s very hard to do 10 years from now. That’s very easy to do right now. Similarly, it’s really hard later to say, “Okay, I want to start a company,” or “I want to go to a really tiny company.” That’s much harder to do in your 30s than when you’re graduating from your undergraduate or your graduate work.

So, if you have that inclination, listen to that, which is also a chance for me to get a shameless plug. I now have a startup of my own. This is the first company I’ve started, which is Lumi Labs, we have a booth over here. We’re going to be working overall in the media space, artificial intelligence, areas that I spent a lot of my career working in. That moment, being able to start a company, being able to go on for more school and really doing whatever you think is going to push you to learn the most, is ultimately the way that I would recommend that ultimately you move. With that, I thank you, and I guess I’ll just turn it back to Cory and the organizers. Thank you so much.

[applause]

[00:08:02] SHOW CLOSE

Listen to every episode of OFF RCRD on iTunes and stay up to date with the show at OFFRCRD.com.

“What I’ve learned is that when you change what someone believes is possible, you change what becomes possible.” — Alex Banayan

In April 2018, I interviewed Scotty Belsky for OFF RCRD. Scott is an entrepreneur, author and early-stage investor, known for co-creating the online portfolio platform Behance, which was sold to Adobe in 2012. Scott wrote top-selling books ‘Making Ideas Happen’ and ‘Maximize The Middle’.

During our conversation, we discuss Scott’s start in tech, his experience in college, the beginning of Behance, common mistakes founders make, and more. Below is the full transcript of the interview. Listen to the episode here on OFFRCRD.com.

[00:01:09] Cory Levy: Why don’t you tell all listeners a little bit about yourself and a little bit about your new book.

[00:01:14] Alex: So for the past seven years, I’ve been on this quest tracking down some of the world’s most successful people. The way it started was, I was 18-years-old, a freshman in college spending every day lying on my dorm room bed staring up at the ceiling. Cory, I don’t know if you’ve gone through the what I want to do with my life crisis. You got into tech pretty early, but I was going through it, man, and it was hitting me really hard.

You know, to give some context, I’m the son of Jewish immigrants which pretty much means, I came out of the womb, my mom cradled me in her arms and she stamped MD on my ass and sent me on my way.

Like in third grade I wore scrubs to school for Halloween, I went to pre-med summer camp. By the time I got to college, I was the pre-med of pre-meds. Very quickly, I remember within just the first couple of weeks, I was laying on this dorm room bed staring at these biology books, feeling like they were dementors sucking the life out of me.

[00:02:03] Cory: What did you do from there?

[00:02:05] Alex: So at first I just was going through this what I want to do with my life crisis, but eventually those questions began to evolve into “how did all these people who I looked up to, how did they do it?” How did Bill Gates sell his first piece of software when nobody knew his name? How did Steven Spielberg without any hits to his name become the youngest major studio director in Hollywood history?

These are the things they don’t really teach you in school, so I just assumed the answers had to be out there. So I started reading a bunch of books looking for answers. Eventually, I was left empty-handed. That’s when my naive 18-year-old thinking kicked in. I thought, “Well, if no one’s writing the book I’m dreaming of reading, why not just write it myself?”

I thought it would be really easy. I would just call up Bill Gates, interview him, interview everyone else and I’d be done in a couple of months. I thought that would be the easy part. The hard part I figured was getting money to fund the journey. I was buried in tuition payment. I was all out of Bar Mitzvah cash, so there had to be a way to make some money. Two nights before my freshman year final exams, I found tickets to The Price is Right, and the first thought that came to my mind was, “What if I just go on the show and win some money to fund this dream?”

It wasn’t my brightest moment, but I thought, “If I just go on this show and win some money, I can go on these travels, I can go out and do all these interviews.” Again, it was a horrible idea. I’d never seen a full episode of the show before. Plus, I had finals in a couple of days. So that night I remember sitting in the library at this little wooden table in the corner of the library and the idea just wouldn’t leave my mind. To prove myself, Cory, I remember literally taking out my spiral notebook and making a pro and cons list of best and worst case scenarios.

For the worst case scenarios, fail finals, get kicked out of pre-med, lose financial aid, mom hates me, mom stops talking to me, look fat on tv. There were 20 cons. The only pro was maybe, maybe get enough money to fund this dream.

[00:03:53] Cory: Were you a freshman at the time?

[00:03:54] Alex: Yes, I was a freshman, 18 years old and I pretty much just started college.

[00:03:59] Cory: And how many people are in the Price is Right audience? I remember reading this part in a book, but for those who haven’t read the book yet, people that are in the audience in The Price is Right, how many people get selected for the potential to win money on the show?

[00:04:10] Alex: There’s about 300 people in the audience and only eight get called down. Out of the eight who get called down, one of them wins. What I realized is the odds of getting called down is much harder than once you’re called down winning. That night I pulled an all-nighter to study, but I didn’t study for finals. I studied how to hack The Price is Right.

Pulling that all-nighter, figuring out the system, the next day I did this ridiculous strategy and ended up winning the entire Showcase Showdown, winning a sailboat, selling the sailboat and that’s how I funded the whole book.

[00:04:40] Cory: How’d you hack the strategy. You had a less than 1% chance of winning the Showcase Showdown and you figured it out. For someone who’s never seen a full episode of the show how did you hack The Price is Right?

[00:04:52] Alex: What I found out in my researching — you can probably relate to this just with your own life experience in the sense that sometimes statistics can be really misleading because they’re assuming that there’s no ways to impact the variables. What I realized during my all-nighter is that it’s not random. Although you watch the prices right and they make it sound like it’s a lottery. “Cory, come on down,” as if they pulled your name out of a hat. What I learned is that there’s a producer who interviews every single person in the audience before the show begins. On top of that there’s also an undercover producer.

When I got to The Price is Right studio the next morning, I was dressed up in colorful clothes. I got there, but the second I got there had no idea who the undercover producer was. I just had to assume everyone was the undercover producer. So I’m dancing with old ladies like kissing the custodians, breakdancing. I don’t know how to break dance. After about an hour of waiting in line outside the studio, it’s finally my turn to be interviewed by the producer. I knew all about the producer.

I knew his name was Stan. I learned like where he went to school, where he grew up. I knew that he has a clipboard, but it’s never in his hands. It’s in his assistant’s hands who’s sitting about ten feet behind him. If Stan likes you, he’ll ask you some more questions. If he really likes you, he’ll turn around, wink to his assistant and she’ll write your name on the clipboard. If the Price is Right was a nightclub then Stan was the bouncer.

I’m standing there and Stan is walking up and down the line and he’s going, “What’s your name, where are you from, what do you do?” He gets to me and I go, “Hey, I’m Alex. I’m 18 years old. I’m a freshman in college and I’m pre-med.” He goes, “Wait. Pre-med. You must spend a lot of time studying. How do you have time to watch The Price is Right?” I go, “Oh, is that where I am?” Literally, the joke just falls flat. There’s no response. I realize I’m losing him. I had read in one of these- I think it was like a Tony Robbins book that said, “Human contact speeds up a relationship.” So I had this idea, I needed to touch Stan.

I’m like, “Stan, come over here. I want to make a handshake with you.” Very reluctantly he comes over and we make a handshake. I teach him how to pound it and blow it up. He says, “Good luck,” and walks over to the next person. He doesn’t ask me any more questions. He doesn’t look back to his assistant. She doesn’t write anything down. Just like that, it’s over. I don’t know if you’ve ever had one of those feelings were like your biggest dream you can see it like literally walking away from slipping through your hands like sand.

[00:07:14] Cory: Did you have any backup plan right now or you’re just like, “All right, this is it?”

[00:07:17] Alex: No, I only had plan A. So when he walked away it was devastating. I don’t know what got into me, but I just felt this rumbling inside my stomach. I just started yelling at the top of my lungs, “Stan.” The entire audience turns around. Stan runs over at me as if I’m having a seizure. He’s like, “Are you okay, are you okay, what’s going on?” I’m just looking at him. I have no idea what I’m going to say next. I’m looking at him, he’s looking at me.

He’s typical Hollywood with a turtleneck and a goatee, and a red scarf. I just look at it and I’m like, “Stan, your scarf.” Now I really don’t know what I’m going to say next. The only thing that comes out of my mouth is I look at him with all the seriousness I can and I just go, “Stan, I’m an avid scarf collector, I have 362 pairs in my dorm room but I’m missing that one. Where did you get it?” He starts cracking up. A part of me thinks that he knew what I was really doing. He was laughing more at why I was doing it.

He gives me his scarf. He’s like, “Look, you need this more than I do. He turns around and his assistant makes a mark on the checkboard. From there the line continues and I’m waiting in line. I see this woman walking around, younger woman with a laminated badge in her back pocket. I think this has to be the undercover producer. I start blowing her kisses and I start dancing and she starts laughing and blow her small kisses. She takes out a sheet of paper from her pocket and makes a mark.

At this point, you would think I feel on top of the world, but that’s when I realized I had spent the entire night prior studying how to get on the show. I still didn’t know how to play. Not a problem, I take out my phone and I Google how to play The Price is Right. I still have about an hour before the show starts. 30 seconds later I feel a tap on my shoulder and security takes the phone away.

At this point, there’s no plan B. I just I sit down on this metal bench. I just start complaining. There is this old lady sitting next to me with silver gray hair. She asked me, “What’s wrong?” I just vent. I tell her about this dream, I tell her about the book. I tell her I’ve never seen a full episode of the show before and she just pinches my cheeks and goes, “Oh honey, I’ve been watching this show for forty years.” I ask her for advice.

She goes, “You remind me of my grandson.” She starts giving me this incredible advice and decades of wisdom start downloading into my head. That’s when the light bulb went off inside. I give her a hug, I say, “Thank you.” I turn to the person next to me and I go, “Hey, I’m Alex. I’m 18. I’ve never seen the show before. Do you have any advice?” I jumped to a group of people and to another group of people. Over the course of an hour, I talked almost half the audience. Before I know it, the doors to the studio open.

When you walk in there the place still smells like the 1970s. There’s yellow and green drapes. There’s flashing lights like all that’s missing is a disco ball. I don’t know if you want me to go to the full details of what happens on the show, but it ends up being just like ridiculous adventure that the lessons from The Price is Right without me knowing foreshadowed so many of the lessons over the past seven years of writing this book.

[00:10:24] Cory: That’s awesome. You ended up winning the showcase. You won- how much? Was it 30 grand?

[00:10:29] Alex: This showcase was 30 grand. I sold the sailboat and used the cash to fund all the adventures.

[00:10:34] Cory: Got it. That was when you were a freshman in college. What did your parents think of all this?

[00:10:39] Alex: Well, at the beginning when I won The Price is Right, they didn’t know I was planning on using the cash to dropout of pre-med and eventually leave school and fund this adventure. They heard The Price is Right, they were jumping up and down. I remember my dad was dancing in the living room. We have a sailboat, we have a sailboat. I ended up selling the boat and using the cash. When you’re in college and you’re living in the dorms, and the most expensive thing you’re getting is Chipotle for lunch, thousands of dollars lasts you a very long time.

[00:11:12] Cory: Great. I want to talk a little bit about some of the interviews that you had. You interviewed Bill Gates, Steve Wozniak, Jessica Alba, Tim Ferriss, Pitbull and many others. What were some of the common things that all the interviewees had?

[00:11:27] Alex: When I set out to write the book, I wasn’t looking for a common thread. We’ve all seen the TED Talks or those business books that say, “The one key to success,” and you sort of just roll your eyes. After going on this quest, doing all these interviews I started to realize — I don’t know if you’re a big music fan but there was almost a common melody in all the stories I was hearing.

The analogy that came to me, because I was 21 at the time, was it’s getting into a nightclub. What I’ve realized is every single person I interviewed treats life, business and success in the exact same way. There’s the first door to get into the nightclub where the line curves around the block. It’s the main entrance and everyone just waits in line hoping to get in. Then there’s the second door, the VIP entrance where the billionaires and the celebrities go through.

You’re born into that line. When no one tells you — for some reason school and society have this way of making you feel those are the only two ways in. What I’ve learned is that there’s always, always the third door. It’s the door where you jump out of line, run down the alley, bang on the door hundred times, crack up the window, go through the kitchen. There’s always a way in. It doesn’t matter if that’s how Gates sold his first piece of software or how Lady Gaga got her first record deal, they all took the third door. That’s not only the thesis of the book in the title of the book. That’s really the energy I’m trying to inject into the next generation.

[00:12:27] Cory: I imagine you had to take a number of third doors. Let’s talk about Bill Gates. How on earth did you get an interview with Bill Gates?

[00:12:53] Alex: To my surprise, Bill Gates doesn’t normally do interviews with 18-year-olds. It’s a lot harder than I had expected. It took an entire year to finally get on the phone with Bill Gates’s chief of staff. He’s the right hand who pretty much runs everything in Bill’s life. It took a whole year to just schedule a five-minute phone call with Gates’s chief of staff. I met some people at Microsoft who believed in the mission enough to help arrange that phone call.

At this point, I’m a sophomore in college. I’m 19 and I’m standing in a CBS parking lot with an ice cream cone on my hand. My phone buzzes and I see the Seattle area code. I know exactly who it is. I pick up the phone and I hear. “You want to interview Bill, huh?” On the phone is Bill Gates’s chief of staff. Of course, I tell him it’s my biggest dream and he goes, “Look, no need to tell me about it. I already have heard all about it and I think what you’re doing is great. I love that you’re doing it to help your generation, but you’re only about 5% there.”

He said, “Go get a publishing deal with either Penguin or Random House. Go build more momentum and call me later,” and hangs up. That then sets me off on this eight-month quest of getting a publishing deal which I end up getting and then still when I reached back out again to chief of staff the interview didn’t happen. What I realize is I needed to build more momentum. I got more interviews, but what really clinched getting the interview with Gates was advice I got from Larry King.

What Larry taught me is that while the Internet has changed the world, it hasn’t changed human beings. Our generation is so comfortable sending e-mails, hitting someone up on Instagram DM. We many times forget about the power of seeing someone looking them in the eyes, seeing them in person and just baring your heart out to them. Larry’s advice inspired me to try to meet Bill Gates’s chief of staff in person. I knew he was going to be at the TED conference that year in Long Beach which wasn’t too far from where I lived.

I spent weeks emailing Gates’s chief of staff trying to set up a meeting and finally the day before the conference I got an email. I remember 7:27 PM. It said, “Yes, I’ll be at the conference and yes I’d like to see you.” Cory, I’m there the next morning. All the pressure is on. This is pretty much two years of my life has led to this moment. I’m waiting there. He said to meet him at the Espresso Bar. I’m sitting at the Espresso Bar of the Westin Hotel, which is the main hotel of the TED conference. We were set to meet at 10:15 in the morning. I get there early. I’m waiting and I’m waiting. It’s 10:15, then it’s 10:30.

[00:15:27] Cory: Did you email him at 10:15 or were you just waiting at a bar.

[00:15:29] Alex: He’s busy. I just assumed that he had to talk to someone or he was running a little late. It’s not a huge deal, but by 10:45 I started to get worried. I started to — It dawned on me that he wasn’t going to come and I was just devastated. I looked up his e-mail and saw the phone number for his assistant. I gave her a call and I tried to take some deep breaths.

I called her and she answers. I say, “Look, I’m so grateful that he even agreed to the meeting and I completely understand. I’m sure you must be busy but I just wanted to make sure everything’s okay because he never showed up.” The assistant goes, “What are you talking about? He called me and said you never showed up. That’s when I found out there were two Espresso Bars. One at the hotel, one at the convention center. I was at the wrong one.

I’m just, “Oh my God.” I just started uncontrollably crying on the phone as much as trying to hold it in, just tears formed in my eyes. I started gushing to this assistant telling her everything it took to make this meeting happen. She’s like, “Look, look, look, Alex. Give me a few minutes, let me see what I can do.” Sure enough, she sends me an email saying the chief of staff has agreed he’s going in his town car to the airport this afternoon. He’s agreed to let you ride in the car with him to the airport.

My five-minute meeting turned into a 45-minute meeting. As soon as I got in the car with Gates’s chief of staff I’m sweating. He goes, “So I take you so want to interview Bill.” I’m like,” Yes, it’s my biggest dream.” He goes, “Well, have you been making momentum?” and I always in my wallet carry a small no card with all the names of people who I wanted to interview with green check marks next to the names of the people who I did interview.

He holds the note card in his hand. I handed it to him and he searched reading and almost as if this is report card. He’s gone, “Oh, Larry King. That must have been a good one. Oh, Dean Kamen, we know him well. Oh — “ and right as he was about to read the next name, again another uncontrollable feeling within me just makes me go. It’s not about the names. He looks at me sort of bewildered.

I just say, It’s not about the names. It’s about — Well, I just believe that if all these people come together, not for press, not to promote anything but really just to share their wisdom with the next generation, young people could do so much more.” He’s like, “All right.” He slices his hand up in the air and he goes, “We’re in.” That’s how Gates interview came to be.

[00:17:50] Cory: That’s awesome. Two years of work, you finally were able to get Bill Gates into a room. What happens next? What advice does Bill have for our generation?

[00:17:59] Alex: When I went in to interview Bill Gates the thing that I was the most curious about is in all my research with him he is one of the most strategic minds alive today. If you study the way Microsoft started some of the most pivotal moments came from just really brilliant moves that Bill made in the negotiating and sales processes that allowed him to make billions off of his deals with IBM and HP, and whatnot.

I went in there looking for this holy grail of business advice that would come out of Bill Gates is now within the second I put it in the book it would just revolutionize the lives of millions of people. That’s what I was expecting and because I spent two years building this up in my head. I just really believe this holy grail of advice existed. When I got into the interview with Bill, he was telling me incredible wisdom, but I was so obsessed with this very preposterous idea of this holy grail that I wasn’t able to understand the beauty of what he was saying.

Only when I look back in hindsight can I see how wise he was. I kept asking for all this negotiating advice. He kept telling me about with the person you’re negotiating with, go out to dinner with them, ask them for advice, ask them for book recommendations. I’m getting like furious in this interview wondering why he’s not giving me real negotiating advice. Only in hindsight can I see that he was actually telling me that the negotiation happens before the negotiation begins. Because if someone is giving you advice, if someone is giving you book recommendations, if someone’s invested in you and becomes a mentor to you, you don’t even have to negotiate. They want you to win. That was something I never could’ve expected coming out of Bill Gates.

[00:19:37] Cory: Very cool. How has this book changed your life? You wrote the book, get all these interviews. How have you changed over the last several years?

[00:19:46] Alex: The book has changed my life in more ways than I can say. Not only the people who I’ve met along the journey while some of them have become like family to me, but my outlook on life has changed. The biggest thing the book gave me, while it gave me unbelievable advice, and tools, and tactics that I’ve used over the years, the biggest gift of this journey is that it changed what I believe is possible. What I’ve learned is that when you change what someone believes is possible, you change what becomes possible. There’s no bigger shift that can happen in someone’s life than that because while you can give someone all the best tools and knowledge in the world, their life can still feel stuck. If you change what someone believes is possible, their life will never be the same.

[00:20:30] Cory: What’s an example of that; what did you think was not possible prior to this journey?

[00:20:34] Alex: A big one that happened without me consciously knowing, happened with how I relate to people who I really, really admire. There’s something about sitting across from Bill Gates who the media does a really good job of making him look like this, superhuman. Whether it’s Elon Musk or Mark Zuckerberg, or Barack Obama, the media does this really powerful job in making these — they’re not even on a pedestal, they’re like above the pedestal.

What I’ve learned is that, and there’s a great quote from Maya Angelou that captures it perfectly, which is, “you’re a human being and no one can be more human than you. No one can be less human than you.” When you realize that every single person who you admire, everyone who you look up to, everyone who’s done something that’s changed the world and impacted your life is a person just like you, and they are no more human than you are, it empowers you in a way that no- a little hack can empower you. That’s changed the way I not only view myself, but I view everyone around me.

[00:21:36] Cory: What do you see in friends, colleagues of this generation, what are some ineffective things that you’ve seen this generation do?

[00:21:44] Alex: You know a lot of people, especially in the entrepreneur space or people who are hustling in the beginning of their careers or even later in their careers, a big thing that people do which is great is cold emailing others. One of the biggest mistakes that I’ve learned and I learned this the hard way, and thankfully Tim Ferriss in my interview with him helped me realize how wrong I was in my approach, was there’s a such thing when you’re cold to emailing someone or reaching out to them as being over persistent.

Every business book talks about how persistence is the key to success. Never give up. There’s never a disclaimer saying that there’s a such thing as over persistence and that can be even more dangerous. If there’s one thing I could leave people with is realizing that while persistence is incredibly important and you won’t achieve a dream without it, there’s a huge difference between banging on one door a thousand times and having people want to call security on you versus banging on the door a few times and no one answers. All right, checking the window. All right, making friends with the bouncer. Okay maybe call. There’s a huge difference. I had to learn that lesson the hard way.

[00:22:49] Cory: What are some other like — if you were to go back in time and write this book or version two of this book, what would be the things that you would do to save time? What have you learned most from your network, from your mentors that have helped you for this journey?

[00:23:05] Alex: Well, when it comes to the lessons in the book, I would have put more emphasis on the emotional. There’s already a lot in there. You’ve read the book, you’ve seen there’s a lot of focus on the emotional tolls of pursuing a dream. You’ve been an entrepreneur for like almost 10 years now, so you know what toll it takes inside.

I would have focused even more on that because I’ve realized there is so much information out there about. You can Google and read thousands, or if not hundreds of articles on Bill Gates, but it’s really, that I’m curious about if I were to go back and interview him again, I would focus on how he dealt with that emotional struggle of — You have a dream and you have a vision, and things aren’t working out.

That’s what I would really bring out more because I feel the thing that makes people wait in line at the first door versus take the third door really comes down to a fear of the unknown of what will happen when they ditch the line and run down the alley, because taking the third door is a lot easier once you’re already running down the alley and you have no choice but to make it happen when you heard survival is on the line.

It’s a lot harder when you’re standing in line at the first door and you’re comfortable. All your friends are there and your family expects you to be there. It’s those emotional aspects that I think are sometimes the hardest hurdles when it comes to achieving a dream.

[00:24:48] Cory: Got it. I wanted to talk briefly about, I remember this topic in the book, like borrowing credibility. What is that? What does that mean? How did that help you when you were 18–19 years old writing this?

[00:24:40] Alex: During my interview with Tim Ferriss, I was asking him how someone gets credibility before they’re credible. It’s a pretty tricky catch 22. If you want to be an author or a writer, most people want to only publish writers who have written other things. How do you get your first thing published? This is a very tricky situation. What Tim Ferriss told me is that it’s not rocket science. The Internet makes it a lot easier and it could be as simple as doing Q&A’s and well-known publications, and having those publications in your byline. It could be volunteering for free for well-known organizations. When Tim was just starting out, he volunteered for the Silicon Valley Association of Startup Entrepreneurs. While all of his friends who had just graduated college with him were saying, “Hey, I’m so-and-so recent college grad,” Tim was able to email best-selling authors and other people he admired and say, “Hi, my name’s Tim Ferriss and I’m a producer for the Silicon Valley Association of Startup Entrepreneurs.”

Those are little things that actually make a big difference when you’re just starting out. The phrase that stuck in my mind like you mentioned, it was called “borrowed credibility.” The idea is that it wasn’t that Tim Ferriss was starting in his own company or his own organization. He was associating himself with reputable sources that made other people trust him and that made a huge difference.

[00:25:56] Cory: What were some of the other life hacks like that that you’ve learned from writing the book?

[00:26:00] Alex: Some great hacks early on — some of them haven’t even been in the book. They came from the process of putting the book together.

[00:26:07] Cory: Let’s talk about those.

[00:26:08] Alex: One that is my favorite hack because it’s so like the opposite of a hack comes from how to write. Myself as well as most of the people if you’re writing a blog post or writing something you’re not typing on your laptop, but every time I was studying Maya Angelou she, swore by writing on yellow legal pads. At first, I thought, “Well, she’s just saying that because she grew up in a time before her laptops so I sort of ignored it.”

Then I saw an article about how Barack Obama writes his State of the Union. I saw pictures of him writing in a yellow legal pads and that made me a bit more curious because Obama’s a very tech-forward person. That was interesting that he was writing it again on yellow legal pads. Then I read this article from Jerry Seinfeld where he just is doing this whole bit about how evil a laptop is. You’re sitting there, you open Microsoft Word and this white light is shining in your eye like an interrogation. It’s like a police interrogation. This white light is shining in your eye.

Then this little cursor just keeps blinking at you, taunting you, “Come on. big shot. Come on, big shot. [laughs] Let’s see what you got.” Just it’s very like hostile environment. I just die — All right, let me give it a week and this is the beginning of writing the book. I was like, “Let me give it a week and just try this whole yellow legal pad situation,” because again Seinfeld wrote all of Seinfeld are using yellow legal pads. I was like, “Let me see what would happen.” I started not using my laptop. I started writing the entire book that week by hand with a pen and a yellow legal pad. Everything changed.

My writing style changed, my writer’s block changed. What I realized is when you’re writing on a yellow legal pad, there’s no intimidation because if you don’t like it, you literally rip it out, crumble it and throw it at the wall. Like you can really own that yellow legal pad, whereas a computer is as very like expensive piece of technology that you’re at the mercy of. An article I read about Spielberg actually helps shine some light onto why this hack works. That actually has to do with the way the brain works.

Spielberg was talking about how at a certain poorness career digital film was very prevalent, but he still preferred printing out the film and walking it over to the editing room. Other directors would laugh at him, but he still liked printing out the film. His explanation was that in the time it took for the film to print for him to hold it in his hands, for him to walk it over to the editing bay, an idea would come to him, that would completely enhance the movie.

I think that’s part of the creative process is having that negative space and having that empty time. When you’re at your computer and when you’re writing on your phone or your laptop, you have the entire world’s knowledge at your fingertips. You can do anything you want. It sort of jams your brain from being creative when a yellow legal pad completely opens up. That’s been the biggest writing hack by far, which is not having the first draft not written using any technology. It’s changed the entire way I write moving forward.

[00:29:23] Cory: That’s awesome. Where can people find this book?

[00:29:26] Alex: It’s available, everywhere books are sold. Amazon, eBooks, Audible. The main book website is thirddoorbook.com, T-H-I-R-D, thirddoorbook.com. On there if they end up ordering the book there’s a bunch of cool bonuses if you buy one copy, or three copies, or 10 copies. It’s really fun and if you end up buying the book, by listening to this podcast definitely tweet at me at Alex Banayan A-L-E-X B-A-N-A-Y-A-N so I know you heard of it through Cory’s podcast. Thank you again for having me. This was really fun.

Listen to every episode of OFF RCRD on iTunes and stay up to date with the show at OFFRCRD.com.

[00:30:34] [END OF AUDIO]

Listen to every episode of OFF RCRD on iTunes and stay up to date with the show at OFFRCRD.com.

“My superpower is just an incredible level of curiosity. I just get obsessed with certain things and dive as deep as I possibly can.” — Jd Ross

I interviewed entrepreneur and OpenDoor Co-Founder Jd Ross in May for an episode of OFF RCRD. Opendoor has raised a total of $320 million in venture funding and has surpassed a multi-billion dollar annual revenue run rate. Before Opendoor, Jd started two successful businesses during college and went on to lead growth as the VP of Product at Addepar.

In the episode, Jd and I discussed avoiding bankruptcy, landing in Silicon Valley, and how to accelerate your personal growth curve. Listen to the episode here on OFFRCRD.com, or view the entire transcript of our conversation below.

[00:01:14] Cory Levy: Thank you, Jd, for taking the time.

[00:01:16] Jd: Thanks, Cory.

[00:01:16] Cory: I’d like to start by asking for you to share a little bit information on yourself. How did you get involved? How did you start Opendoor? How did you move to san Francisco? Where are you from?

[00:01:27] Jd: Let’s start with, for those who don’t know, Opendoor is a company that makes selling a home simple, certain, and fast. We purchase it from you for the full market value in cash in as little as three days. The reason for that is that most people can’t buy a home until they sell their current home, and so we let them unlock that home equity and become more competitive buyers.

In our first four years, we’ve helped tens of thousands of people complete that hassle-free move. We’re buying about a thousand homes per month right now in our first two markets. I started a company with three other co-founders, Keith Rabois, Eric Wu, and then Ian Wong.

I started my journey as an entrepreneur back in college. I went to Wash U. During my freshman year, I started two businesses with a loan from family and friends. The first was a moving and storage business called U-Trucking. The second was a custom apparel company that was called Fresh Prints, which is a terrible pun but a good business. They were both successful. Fresh Prints did a couple million in sales in its first year in campuses across the country. U-Trucking was used by nearly two-thirds of students of Wash U that don’t live within driving distance.

I learned three big things from those companies. The first was how to do practical engineering. I think a lot of CS students come away pretty disillusioned by the curriculum in terms of actually being able to build companies. Starting a company is a great way to actually personally build the websites, invoicing systems, marketing, logistics, whatever else you need to do on your own mostly from scratch. That’s a really good way to become a much better engineer in terms of practical business acumen.

The second thing I learned during those businesses was customer obsession. I sent out over 20,000 personal emails and made over 2,000 phone calls to customers in the first three years. If you want to learn to build a great business, you just need to invest that time. I don’t think nearly enough people, especially with the kind of CS or startup backgrounds want to invest the time just talking to customers over and over and over again. That’s so important.

The third piece I think is how to thrive in chaos. During one of the summers at U-Trucking, there was a flood that hit our storage facility. Our insurance company, of course, is the first call we make. They were like, “That’s an act of God so we’re going to deny all of your claims.” I’m not sure if anyone is familiar with how cash flow businesses work, but you don’t have a lot of venture backing to deal with those sorts of things.

About 10% of our customers’ boxes had some amount of damage. I spent personally hundreds of hours between classes those first few months just cataloging every single piece of damaged item across every single box with every customer in the storage business. That was insanely hard. I think I learned more in those three months than probably any point in my career afterwards. Out of pocket, I reimbursed people for all the damage.

I needed to take out a loan, actually from the school to prevent bankrupting the company. For them, the school kind of treated it as a PR crisis that a student-run business had these problems. It was willing to loan me some cash to front reimbursement. I kept my reputation. I think that’s more important than anything. Interestingly enough, the next summer we had all-time high sales, so it was a good lesson in karma as well.

[00:04:18] Cory: Wow. You said you did how many calls? Over 2,000 phone calls and 20,000 emails?

[00:04:22] Jd: Yes. Those are the ones I recorded. I don’t know if there’s other ones. There’s probably plenty of other ones I didn’t have logged anywhere.

[00:04:27] Cory: I think that’s amazing. What went down during those calls? What emails did you send? I get a bunch of automated emails from people when I sign up for services. I’d love to dive deep into that.

[00:04:39] Jd: These are 20,000 personal emails. Not a single one of those counts for automated. I sent probably 150,000 plus automated ones. I think those were basically just answering customers’ questions, or reaching out and asking what can we do better, helping schedule people. Basically, all the things that would eventually need to become automated in the business, I just did by hand enough times and it drove me insane. That’s what led to me building out these logistic systems, building out these marketing email systems, building out — All these things that I later learned to code in order to do started with me being incredibly frustrated by having to do it by hand.

[00:05:11] Cory: Did you stay in school and graduate?

[00:05:13] Jd: I graduated in three and a half years, but I was flying out of Saint Louis probably more often than my professors liked.

[00:05:19] Cory: What’s your take on that debate whether to stay in school or drop out? Seems like you had two successful businesses while you were in school. Sure you probably thought about that. Did that ever come up where you were thinking of dropping out?

[00:05:29] Jd: It did. I had two people who were pressuring me to drop out at the time. I didn’t listen to either of them because the first person who was pressuring me not to was my grandmother, and that’s pretty important. I don’t think that dropping out is necessary. I think if it’s your company and it’s on a rocket ship and you’re finding out that you’re spending almost all of your time building it, then yes, drop out.

If you’re a student and someone’s offering you a job at some company that you don’t think you could have gotten, 99 times out of 100, dropping out’s probably the wrong decision. It’s better just to complete your degree and that job will still be there. Those opportunities are still going to be there. If you’re smart and capable, have some faith in yourself.

[00:06:05] Cory: How many hours out of the week were you working on your companies verses at school?

[00:06:11] Jd: It’s hard for me to remember. I think I’ve always been that 24/7 person in general. I know at school I was in a fraternity. I was hosting these parties every week, two to three parties a week on top of these companies. I clearly wasn’t doing only the two businesses, but they definitely took up a huge amount of time. Pretty seasonal businesses, so I know that from probably March until September, I was far more focused on the business than on school and having fun, but those middle months were a little more flexible.

[00:06:41] Cory: What happened once you graduated? How did you remove yourself from those two business and get into Silicon Valley?

[00:06:47] Jd: My sophomore year I was being recruited by some people on Google’s APM program. I was at some dinner. Someone at the table told me, “You shouldn’t join Google. You need to meet this guy, Joe Lonsdale.” I had no idea what he was talking about, but I thought it was really interesting and funny that he was willing to say that at that dinner, so I took the call.

This is 2009, so it’s in the midst of the recession and Joe had just left talent here to start a company called Addepar. The mission was to fix the financial system, whatever that meant at the time, and I was sold. I flew out that summer and started working as an engineer for him. It was something like you $800 a month. We were working out of his house. I’d never been to California before. Startups weren’t really a thing at that point. My friends all thought I was totally insane.

Again, I was running these two businesses that were doing well. I ultimately ended up leading the product team as Addepar grew from five to a hundred people, onboarded about a hundred billion dollars in client assets to that platform, hopefully, lead to a place where finance is more transparent.

During that time, we were flying back and forth from Saint Louis to San Francisco. It wasn’t exactly sustainable. I think at that age when you have those opportunities, you just have to push yourself to do it, find the time, sacrifice elsewhere. If you’re going to be a successful entrepreneur, walking and chewing gum is a skill you want to learn how to build.

[00:07:58] Cory: How old were you when you met Joe Lonsdale? You were employee number five at a Addepar.

[00:08:04] Jd: Yes. I met Joe when I was 19. I was my sophomore summer. It was myself, Joe, and then two other people full time at Addepar, and then a fourth one joined before I was able to claim the fifth title. We didn’t know exactly what we were doing in the way that today startups have these playbooks that they can build off of from YC and everywhere else. It was a little more “figure it out as you go,” which was good and bad.

I personally picked up a lot of good habits, but also some bad habits from that journey that I’ve had to unlearn at Opendoor. It was really a valuable experience. Being 19 and having the opportunity to craft something new with people who’ve been successful before is probably the best thing you can do. Finding that mentor would be my number one suggestion.

[00:08:44] Cory: What were some of the things that you’ve learned from Joe?

[00:08:47] Jd: Joe was incredibly mission-driven. I think more so than almost anyone I’ve ever met, believes that you should never do something that isn’t a personal mission, isn’t better in your view for the world. You’re never going to be perfect at that, but using that as a filter is incredibly valuable in your decision-making.

[00:09:04] Cory: About a minute ago, you spoke about finding an entourage. What would be your advice to somebody listening to this right now that doesn’t live in San Francisco, maybe he or she lives in the Midwest or out of the country. What would be your advice to them on finding a mentor?

[00:09:18] Jd: My advice is, maybe this is contrarian these days, but just move to San Francisco. The density of talent and the number of people here who have done it before is just so much higher. I think I have a lot of friends who were in the Midwest, or even on the east coast who just have found what I would consider probably to be a top two or three percent person to be a mentor locally, but that person impels in comparison to the types of people available in San Francisco and the Bay area. I think the best shot is still to come out to San Francisco and meet someone here.

[00:09:47] Cory: Now that you’re on the other side of the table and you’ve hired hundreds of people, if you were to reflect on your experience with Joe, why do you think Joe hired you at 19? What made you attractive?

[00:09:57] Jd: I can’t speak to why Joe hired me, but I think that the reason

I was hirable was that I had shown that I could be successful before. Running those two companies and showing that they were actually successful, and having built up the skill sets around that, I think it’s that “be-so-good they can’t ignore you.”

The way to get so good is just to do things yourself. You don’t need permission from anyone to build a business. You don’t need permission from anyone to find that talented student in your dorm who you want to build something with. You can just do that. I think, looking where you don’t need permission and building there first is going to make you far more attractive to mentors in the future.

[00:10:31] Cory: That’s great. Great advice. I’d love to talk about the Opendoor story and how you got connected to your co-founders. How did you get connected to…was it three of four co-founders?

[00:10:42] Jd: Yes. There’s three other co-founders. First was Keith Rabois who’s now a general partner at Khosla Ventures, former COO of Square, and one of the PayPal mafia. Keith and I met at a Square party at Red Door Coffee. He was celebrating Square’s first day where they’d had a million dollars in sales on the platform. If you look at what they’re doing today, it’s pretty funny to think how small they were then, maybe 30, 40 people.

We got into an argument during this party. I knew who he was from Twitter at the time. We started arguing about fraud loss rates. I was just convinced that they were going to make the same mistakes that they made at PayPal where they cared too much about fraud and solving the problem at the expense of customer experience.

I don’t remember the exact positions each of us had, but at the end of it, he tried to hire me to run the risk team, which I thought was funny because I knew almost nothing about risk, [laughs] and certainly nothing about credit cards. I just had a passion for the customer experience around it. Because I decided I was totally unqualified, I said, “No.”

We ended up becoming good friends and arguing about startups for a few more years. A lot of that time was spent talking about real estate and why real estate was broken and what could be done about it. Through that, Keith had this idea for a long time called Home Run, where you’d go to the site, you enter your address, and you’d say what you’re willing to sell your home for, and decide whether to say yes or no.

I didn’t think that was a great idea, but I thought I had a nugget of a really good idea. Keith was telling a lot of people about this at that time, and eventually connected me and Eric, who is our CEO. He had started a company that sold to Trulia, he had run a 50 to 100 home portfolio since he was 18 years old. The founder/market fit was off the charts, so we really clicked. I respected how he thought about customers. I really respected how he thought about customer development.

The reason I mentioned Keith trying to hire me for this risk job is the fourth co-founder is Ian Wong who ended up taking that job and leading risk at Square. We pulled him out of another small startup to start this company together.

[00:12:31] Cory: I’d like to ask, how did you all buy your first home? How did you know there was demand for this product? Was there anything that you did early on to assess the demand for Opendoor?

[00:12:40] Jd: Yes. It’s really funny, I don’t think we’ve told this story publicly before. Selling a home is a really important and emotional moment if you’ve never done it before. We really did not want to mess it up. Before we really launched or even raised any money and did anything, we created this fake brand called simplersell.com, just mostly to figure out, “Could we actually do this? Could we offer a fair market value on someone’s home? Would it be a great experience for them?”

We didn’t want to cause any trouble. We didn’t want to make any mistakes. It worked. It worked really well. Our first customer, Josh Brewer, out in Phoenix took the plunge with us. Went to a Facebook ad, clicked on it, entered his home address and sold his home to Simplersell. I think, we were probably 10 people in the company at the time, and we had this bottle of wine we blended together called the Simpler Seller which I’m aging in my basement right now.

[00:13:31] Cory: That’s great. What do you wish you would have done more of, much earlier in your life, specifically actions or activities with compounding effects?

[00:13:40] Jd: I think I massively under weighed the importance of listening to other people, and the importance of building relationships around disagreements instead of using them as a way to get to the truth. I think, one of the things I did really poorly early in my career and I hope I’ve gotten a lot better at is when I had an opinion, whether I was right or wrong, let’s assume for the sake of argument I was right, I viewed my job as taking someone from their position to mine as efficiently as possible.

That doesn’t work. Maybe it does work to a certain extent, but it’s definitely not the best thing to do. A much more effective way to do that is to deeply understand where someone is, what led them to their conclusions, and then to fill in context and sort of draw the path from where you are to where they are, and then you can both walk on it. That’s a much better way to both get to the truth, and also to build a much stronger relationship with that person, which allows you to get to harder questions in the future.

[00:14:36] Cory: Who would you say some of your mentors are today?

[00:14:38] Jd: Keith is still very much a mentor of mine. Eric is a mentor of mine. I still keep Joe as a mentor of mine. I have a lot of internal mentors at the company. I have my spiritual mentor as my executive coach, which I highly recommend to anyone who has a large team is to get an executive coach. You find mentorship in so many places. I think Twitter in itself is a great way to get that one-way mentorship. You can now look to the smartest people in the world feeding insight constantly who will often even engage with you if you just reach out to them. That’s amazing, and I recommend biographies.

[00:15:10] Cory: Which biographies?

[00:15:12] Jd: You know what’s funny about recommending books is that it needs to be at the right moment in someone’s life for them to really hit. Books that have been really impactful for me are sometimes books that today would mean absolutely nothing, or tomorrow might be the most insightful thing I could possibly be handed. So it’s hard for me to recommend any book without knowing where someone is today.

Recently, I’ve really enjoyed Benjamin Franklin biography by Walter Isaacson. I’ve really enjoyed Power Broker by Robert Caro. I could probably name 10 or 12 others, but again, it’s about point in time.

[00:15:42] Cory: When did you start with the executive coach? I’d love to dive deeper into that.

[00:15:48] Jd: I started Opendoor when I was 23 years old. I had maybe managed eight or so people before. I found myself with a larger team and a lot of pressure to grow very quickly. I think one of my co-founders, Keith, gave a talk during YC Startup School about operating a business. There’s the company growth curve and your personal growth curve.

Whatever you can do to accelerate your personal growth curve as a founder in a company is incredibly important and worth prioritizing, and so I decided and heard before that an executive coach would be a great way to accelerate your personal growth curve, and that was worth the investment.

[00:16:24] Cory: When did you get that executive coach? Was it right at 23 when you started the company, or was it a year or two or three in?

[00:16:29] Jd: I interviewed probably 20 or 30 coaches before I settled on the coach I work with today. I believe we’ve been working together now for about two and a half years, so probably about two years in.

[00:16:40] Cory: How big was Opendoor at the very beginning of that period two and a half years ago?

[00:16:43] Jd: I think Opendoor was probably around 40 or so people, maybe 50 people.

[00:16:48] Cory: Got it. What are some of the biggest things that you’ve worked on with this coach, and where you’ve grown with this coach?

[00:16:55] Jd: A lot of it is just interpersonal dynamics, less so on like strategy. I get most of that mentorship from my team here and hiring really great people. What’s interesting is that as you grow the company from one to ten to hundreds of people you, just have these different chapters. One my favorite rules is the rule of threes. Every time the company triples, everything breaks. Everything that worked really well is a complete disarray and a disaster. You learn that by trial and error.

The first 10 people, everyone in that group of 10 people is going to replicate themselves at least 10 times if you’re successful — all of their strengths, all their weaknesses. It’s critical that every single person in that initial group is someone you’re ready to spend 24/7 with because you’re likely going to do that.

The next stage is this, I call it the band of brothers and sisters stage. It’s like that first 30, 40 people. They really shape the culture. A lot of founders at this stage start hiring for culture fit, but you really should be looking for cultural contribution. It’s really crucial that you develop an open dialogue with everyone in that group about what’s working, what’s not working, and what the company should do about it. You want every single person in that band of brothers and sisters to be a missionary for the company and the mission. You want it to be part of their identity.

The reason you get a coach at the next stage is because you hit this ‘it’s all changing’ stage from 50 to 150 people where a lot of companies falter because you’re growing so fast and everything is absolutely on fire. There’s not enough structure yet and you don’t really have necessarily a leadership team built out. At this stage, earlier employees who previously were generalists, they can start to feel disengaged because it’s no longer that band of brothers and sisters. They don’t know everyone anymore.

You can turn that into empowerment. You can sit them down one on one to say “You’re a flagbearer for the company. You’re a flagbearer for Opendoor’s culture. Everyone who is joining today is going to look to you for how to behave and how to contribute. It’s on you to teach them what it means to be a member of the team here. If you don’t, they’re going to change it.”

I recommend at that point also reaching out to every one of these missionaries in the company and gathering their opinions of what the company’s values are, and using that bottoms-up process where everyone contributes to write down and establish a set of what are your company’s values, and make sure everyone knows them.

[00:19:05] Cory: You mentioned that executive coaching is something that you do to accelerate your own personal growth curve. What are some other things that you’ve done to accelerate that growth curve?

[00:19:14] Jd: Good question.

[00:19:14] Cory: Done or doing.

[00:19:15] Jd: I think the biggest thing for accelerating your growth curve is just understanding that people learn through osmosis, and so surrounding yourself by great people is the single best way to grow yourself. The adage is you are the average of the five people you spend most of your time with. You’re probably the average of the 30 to 40 people you spend your most time with, probably in proportion to the amount of time you spend with them. Be really rigorous about who you’re spend your time with, and thoughtful about who you want to be. That helps a lot in being able to grow in the ways you want to grow.

[00:19:44] Cory: Let’s talk about Keith a little bit. He’s been on the show before; a great episode. What are some of the things that you’ve learned from him?

[00:19:47] Jd: What’s funny about Keith is that he’s basically a state machine for the right answer. He doesn’t always necessarily know why, he just knows what’s right. By working with Keith, you get this cheat code to the answer, and then you get to work backwards to why he’s right. That’s both helpful and frustrating. That itself is a huge accelerant.

[00:20:07] Cory: What are some non-obvious things that you’ve done as founder to make Opendoor successful?

[00:20:12] Jd: I think it’s really important once you have a team of probably 30 or so people, to do a great job with orientation. When someone joins, everyone remembers their first day. Being present for that and making sure that you invest a tremendous amount of time and energy in making that first day and first week really effective, has lasting impact on not just that person but also the culture of the whole company.

One example is, in that 50 to 150-person phase where everything’s changing really quickly, by sharing the company’s values and telling everyone who joins that, “Hey, you are here because things are broken. We’re not hiring you because things are working. We’re hiring you because things aren’t working. Every time you see something that’s broken it’s probably because it is. It’s your job to change it. It’s your job to make a big change if it’s a big problem. You should feel empowered to do that.”

Making yourself available personally to talk to those people if they ever feel like they’re blocked, I think, has helped us avoid a lot of major problems in the past.

[00:21:08] Cory: What’s the average day look like for you?

[00:21:11] Jd: My average day is a little bit different than it has been in the past because I get to work on new product development. I’d say about 30% of my time is still spent on hiring. About 30% of my time is spent on new product development with a couple other people on my team. The remainder of that time is split between doing things that are company-oriented, whether that’s helping out another team, working with the product team, doing some kind of PR comms work. There’s always just an endless stream of work coming in, and you have to pick and choose as it comes in.

[00:21:40] Cory: What is a life hack that very few people know about that you do?

[00:21:44] Jd: I think people look for these complicated but easy solutions to problems. Like, “Eat this supplement and drink this organic tea, and you’ll get a six pack in 18 days.” I don’t think most things are complicated/easy; most things are simple and hard.

My life hack is just the willingness to do the things that are simple and hard; sleep eight hours a day, eat healthy, be nice to my girlfriend, spend time in the gym. Those things, over time — and I think the hidden component here, the life hack here is accept that time is a big variable to it. (These) are the best hacks because most people aren’t willing to do these simple, hard things over a period of time.

[00:22:19] Cory: Who are three people who you’re watching right now you think will be super successful but still young and aren’t yet.

[00:22:26] Jd: You want me to name three people?

[00:22:27] Cory: Yes.

[00:22:29] Jd: [laughs] There are a lot of really great younger people, and some older. I’m not going to name three people, but Opendoor is absolutely filled to the brim with people I’m excited to invest in someday when they build out their companies. I’m constantly in shock of the talent they bring in, and also the talent we develop.

I think what helps about being a really hard company — and Opendoor is in extremely hard company. I wish it was closer to Instagram or something, but it’s not. We have to be on the ground with every single home that we buy and sell. It’s both product, it’s operations, it’s data science, it’s capital markets. It’s just a complicated business. You’re forced to learn all of these different aspects by being here over the course of even just a few years that make you set up to be a really successful founder.

[00:23:11] Cory: What’s your advice to young people who are trying to figure out what they want do with their lives?

[00:23:15] Jd: I’m not sure I’m the best suited to answer that because I’ve always had a pretty strong sense of direction. I lack a level of empathy for people who don’t have that because I just haven’t been there. My advice is to find something that’s so obvious to you that you have to do it, and to wait for that; not to be impatient about jumping at the first opportunity that seems okay, but to find something that really, really excites you, and that you can dedicate 150% of yourself to.

[00:23:37] Cory: When you had those two successful businesses and college, (how did you) step aside and say, “You know what? I can do something even greater than this”? I could see that someone could find that pretty difficult.

[00:23:49] Jd: My superpower is just an incredible level of curiosity. I just get obsessed with certain things and dive as deep as I possibly can. Most people don’t probably think that storage, shipping, and custom apparel are interesting. If you told me to start a concrete business, I could probably wax poetic about it for days once I get into it. I think anything is really interesting when you look closely, but I’m not sure if other people have that same level of general curiosity I have. If you don’t, find the thing that does pique that curiosity and go after that.

[00:24:18] Cory: What are your biggest challenges right now?

[00:24:21] Jd: Growing Opendoor. We’re buying 1,000 homes per month. In our first few markets, we’ve raised over $300 million. We’re doing about $2.5 billion in revenue run rate growing really fast. I think we’re in eight markets today. We’ll be in dozens over the next year. Now is a crazy time at Opendoor. My personal challenges are tied very tightly to the company’s challenges.

[00:24:41] Cory: Based on the three things that you’ve learned from your businesses that you ran while you were in college, practical engineering, customer obsession and thriving in chaos, how is that related to Opendoor today?

[00:24:52] Jd: That’s a great question. I think I can talk to each three of those. The first on practical engineering — Opendoor is an engineering company. We’re a tech company.

Learning how to intersect really strong software development and data science with actual business problems and translating between those two is the basis of this entire company.

The second one around customer obsession, we have core values as a company. The number one core value is to start and end with the customer. That’s not to start and end with the business, not to start and end with what’s possible. It’s start and end with what’s needed by customers, and you work backwards from there. It’s easy to say that, but to deeply understand what it is that customers are actually looking for and what should the world look like, and fighting for that, it is the basis of what Opendoor has been built on.

The third piece is thriving in chaos. Starting a company and building a company is hard, capital H hard. One of the things we talk about a lot within Opendoor, we call it the hulk mentality, you want to hire people and also develop people to get stronger as things get harder. That resilience is critical because things will come out of left field all the time.

You can’t predict this happening because by definition you’re on the edge of what’s happened already. You’re uncovering — you’re on this frontier uncovering this new territory. You have to learn how to thrive in chaos because the entire business is always going to be chaos if you’re innovating.

[00:26:09] Cory: Are there three people who you would like to thank, who’ve helped you in your career?

[00:26:14] Jd: It’s going to be cheesy but I always will thank my parents. I’m not sure if that counts as one or two. I think it’s really important to have a constant in your life. For me, that’s always been my parents. They’ve supported me from day one. They continue to support me always.

I would thank Keith for giving me wisdom and the space to develop it. I would then — it’s hard to pick three. I’m so thankful for being surrounded by so many great people both big and small. I think personal integrity is really important. It’s important to me personally, and it’s important professionally that if you can come into something and do it for selfless reasons — I love building tech companies. I love building technology. I love building products. I love working with people to build those things.

Coming from that genuine place opens you up to find other people who share that genuine joy. I’m just grateful for that above all.

[00:27:44] [END OF AUDIO]

Listen to every episode of OFF RCRD on iTunes and stay up to date with the show at OFFRCRD.com.

Decoding Generation Z, even after spending the past five years getting to know them, has been difficult to say the least. One minute they’re eating Tide Pods, the next they’re leading a nationwide effort to strengthen gun control laws.

As the Co-Founder and COO of After School, the largest teen-focused social network, my job is to understand teens and figure out how to help them. It’s not an easy task, and even after spending thousands of hours talking to and observing the behavior of teens, I can’t predict what they’ll do next. However, during a series of one-on-one interviews with teens across the country, I learned how and why they see themselves as different than older generations.

Based on these interviews, here are 8 things that you other generations don’t understand about today’s teenager:

1. They Don’t Know Their Own Phone Numbers

Today’s teenagers are heavily addicted to their phones, and they don’t know their phone numbers because they rarely make actual phone calls with them.

Teens care about usernames and apps, not phone numbers. When they meet someone new, they don’t exchange their phone number; they exchange their Instagram handle or their Snap username. They rarely even use iMessage or SMS because their parents can see this activity.

“Parents just don’t understand why we move from thing to thing so quickly. It’s not that we have a short attention span, it is our generation’s ability to filter through information more quickly because we just get bombarded with it so much,” said Shreyas, a high school senior.

2. They Think Facebook is Lame

Even before recent controversies about Facebook’s collection and use of data, teens today think Facebook is lame and something for their parents and grandparents.

Teens use After School because they know that they are in a network with other teens from their school, and they are able to connect and share anonymously. They’ve used anonymity to share things they wouldn’t share on other networks — they’ll talk about difficult issues like coming out, depression, and the stress of high school.

Teens also love Snapchat “Snapstreaks” and posting on Instagram. Many teens even set up a second Instagram account, which they call a “Finsta.” Their first account is a public persona, and the Finsta is a more unfiltered experience.

3. They are Modern-Day Shakespeares

Teens are incredibly inventive, including when it comes to the language they use. Here is a short list of some of the words teens are using today:

AMOSC = Add me on Snapchat

Bad = Good

Bruh = Bro/brother

Curve = To reject someone

Don’t @ me = Don’t call me out/don’t disagree

Finna = I’m going to

Finsta = Fake Instagram

GOAT = Greatest of all time

Gucci = Good

I’m weak/dead = That’s so funny

Savage = Bold, strong

Low key = Secretive

High key = When everyone should know something

Shipped = In a relationship

Sus = Shady, suspicious, sketchy

4. Words Aren’t Always Necessary

While they’re inventive with words, they don’t need them. Teens communicate with emojis, memes, and GIFs to express even complex emotions quickly.

If you look at any teen text conversation, you will immediately notice the difference when compared to yours. They are used to a flood of information and have become good at processing it quickly and conveying ideas quickly, which is why emojis, memes, and GIFs have become so popular — they are efficient.

5. They Think You’re Close-Minded

Teens think adults are close-minded when it comes to things like same-sex marriage, different sexual orientation, and mixed-race dating. This makes sense when you consider that they are part of the most racially diverse generation in America. 48% of their generation is non-white. 81% have friends of a different race. 35% have dated someone of another race.

Sydney, a 16-year-old, said, “most kids like myself, and especially ones in an urban environment, care about the rights of themselves but also people that don’t look like them or share similar attributes and that’s the reason why we actually go out and protest at city hall because it’s hard for adults who are stuck in their ways to see when change is necessary.”

6. Gamers are Heroes, Not Geeks

Teens still love their celebrities like movie stars, musicians, and athletes. But who can be a celebrity is much more broad for them than it is for you. They idolize Vloggers like Jake Paul, love entrepreneurs like Gary Vaynerchuk, and they have made Esports figures their heroes.

“While athletes and movie stars are still famous, the idolization of entrepreneurs like Gary and YouTube vloggers and influencers has completely changed the perception. The fact that an entrepreneur came out with a shoe that sold out to kids in seconds is unreal. High schoolers are paying more and more attention to Esports and so is the world,” said 16-year-old Jesse.

7. They Have No Interest in Working at Large Companies

Most teens have little interest in working for major corporations, even tech giants like Google or Microsoft. They’ve seen their parents and older siblings struggle in the workforce, and become unhappy despite having well-paying jobs.

They are also more entrepreneurial than older generations, have less patience for bureaucratic work environments, and crave more independence. In fact, 72% of teens say they want to start their own business someday.

8. They are Worried

Teens have grown up watching reports of a broken political system, devastating climate change, mass shootings at schools, homegrown terrorism, and ongoing wars. It’s no surprise that in our poll on teen stress, over 40% of teens stated that they are stressed “all the time.” 79% of teens are already worried about their job prospects, and 70% are worried about inequality.

Want to better understand teens? As I’ve found, the best way to learn about them is to talk with them. So next time you have the chance, take a moment to ask a teen for their opinion on a topic, advice, or perspective. You might not decode them, but you’ll better understand the generation that’s already changing the world as we know it.

“Don’t optimize (your work) for the additional busy, especially early in your career. Just do whatever you can to get incrementally closer to what you’re genuinely interested in.” — Scott Belsky

In April 2018, I interviewed Scotty Belsky for OFF RCRD. Scott is an entrepreneur, author and early-stage investor, known for co-creating the online portfolio platform Behance, which was sold to Adobe in 2012. Scott wrote top-selling books ‘Making Ideas Happen’ and ‘Maximize The Middle’.

During our conversation, we discuss Scott’s start in tech, his experience in college, the beginning of Behance, common mistakes founders make, and more. Below is the full transcript of the interview. Listen to the episode here on OFFRCRD.com.

[00:01:12] Cory Levy: Thank you, Scott, for joining the show today.

[00:01:14] Scott Belsky: Thank you for having me, Cory.

[00:01:15] Cory: I’d like to start by asking you what were your teenage years like? What was high school like?

[00:01:19] Scott: I went to one school through ninth grade, and then I went to another school from 10th to 12th grade, but I took a six-month period off to live in a farm in Vermont during that period as well. It was choppy — a number different things in a short period of time.

[00:01:34] Cory: What do you think made you distinct?

[00:01:37] Scott: Those were years where I — I think I was behind the curve a little bit and finding myself, finding what I was interested in doing and exploring. I’ve always been an introvert. I was always doing lots of projects in my garage type of thing I remember through high school. Various art projects and things like that.

I think about the friendships I really made that ended up defining a big part of my life, happened in college, not in high school. Maybe that’s partly a function of the fact that I wasn’t in one particular high school for four years.

[00:02:07] Cory: Then you went to Cornell’s, is that right? What was that like?

[00:02:11] Scott: I loved Cornell. One of the things I loved about it is how many different colleges they actually have there. The College of Human Ecology where I took a lot of the classes in the design environmental analysis major, that really ended up changing the course of my life. There’s an Agricultural and Life Sciences College, I took a lot of atmospheric science classes and science for systems classes. There was the arts college where I took all of my economics and a lot of the business classes. Being in a place where you could pursue any study in anything, which is a core value of Cornell, was just the right place at the right time for me.

[00:02:47] Cory: If you could go back in time, is there anything you would tell yourself to get more out of those four years 18–22?

[00:02:53] Scott: Aside from if I’m a child of God everything is going to be okay?

I think one of things I would have told myself is that the stuff I was doing outside of class probably was way more important than what I was doing inside of class, in terms of defining my interests and building my capabilities as a leader and a creative thinker.

A lot of the things they did on the side like various clubs and hosting a conference and all these other things, were just absolutely pivotal parts of my education. It’s funny, you just don’t get course credit for the stuff that actually moves you to learn the most.

[00:03:26] Cory: You graduated school and you went Goldman Sachs, is that right?

[00:03:30] Scott: Yes. I graduated in 2002, and in 2001 I had to choose whether I’d get an internship you know, and I was choosing various types of companies. At the time, if you wanted to go into business at any point in your life, you cut your teeth on Wall Street. I found this job at Goldman, and first year and a half or so I just absolutely hated it. It was more of a finance-type job.

Then I was going to leave the firm, and they said, “Well, if you have anything else you want to do what would it be?” I said, “Well, I’d love to learn how the organization’s improved and how succession planning happens and how leaders are selected.” I just was so interested in the leadership development and organizational management side of it. I got this job in the executive office doing what is basically like management consulting for the firm and clients. I think it was during that period of time I fell in love with the idea of organizing and building culture and stuff like that.

[00:04:20] Cory: What do you think got you to that? Like if you were right now giving advice to someone just graduating school, trying to figure out what to do with their lives, what do you think (are some) ways to figure out what he or she’s good at?

[00:04:32] Scott: Well, I think there’s a couple things. First of all, you want to work in your overlap of what’s genuinely interesting to you; skills you either have or could easily possess, and then opportunities that present themselves. Every job you take, you want to just get incrementally closer to the absolute intersection of those three things.

For me, at Goldman, I had skills. A genuine interest was increasingly towards leadership development, organizational improvement, and using design to help get people aligned with the strategy and things like that.

Even though that wasn’t at all the job I was destined to have over the long term, it was incrementally closer. That’s why I always advise people when they’re choosing what to do next, I’m like, “Hey, don’t optimize for the additional buck especially early in your career. Just do whatever you can to get incrementally closer to what you’re genuinely interested in and what you have skills for or could easily learn and whatever opportunities are around you.”

[00:05:20] Cory: Was Goldman Sachs the only opportunity that when you were starting your career that you had, or were you picking between a couple of the different?

[00:05:26] Scott: It was probably the most accessible opportunity to me, only because I was in New York at a college here, I didn’t have exposure to the tech world out west yet at all. I knew people there who were recent graduates, who I knew were undergrad, who were keeping an eye on me and saying, “Hey, if you want an internship, let me know” type of thing. In some ways, it was my shoe in to having a job after college. It was just, that was the opportunity part.

[00:05:55] Cory: Then you left Goldman. You saved a little bit of money, you quit the comfortable job at one of the world’s most prestigious firms to start a brand new project. What was that like, can you walk me through what led to that and then when you ripped the bandage off — what that was like?

[00:06:13] Scott: This latter role I had at Goldman that I actually enjoyed and learned a lot from for about three years. I was always interested in applying the stuff I was learning in that job around organizational development and leadership development and just structures for communication strategy within companies. I was always interested in applying that to the creative world. This is an area, a role that I immersed myself in in college a little bit and took classes in design.

The idea was like, “Gosh, the creative world proclaims to be one of the most disorganized communities on the planet. Everyone almost wears disorganization as a badge of honor in the art and design worlds, to some extent or at least did, why not just try to help organize and get these people’s careers on track and help designers have a more important role within their companies?” I just felt like there was a need to focus less on making people more creative, and more on making creative people more organized.

[00:07:03] Cory: You had this idea, what happened next? You didn’t go right out and raised capital for it, right?

[00:07:10] Scott: Right. Short version is I had this idea to organize the creative world and people said, “Yes, good luck with that.” Nevertheless, I put together a plan for what I thought a great business. I came up with the idea of Behance, which is people enhancing themselves, taking an active role in their creative careers, and put together a model that included a series of paper products, an online network for creative professionals, conference. Way too many things out of the gate, let’s just say that.

I would say that everything was on mission and everything was about organizing creative people. I then started the process of meeting other people that might want to work with me and some collaborations outside of work, after work late at night with a bottle of wine type of stuff. Then investing a little bit of my own money to get this thing off the ground. Long story short, five years of bootstrapping before we ever raised a cent from a venture capitalist.

[00:07:55] Cory: If you just go back in time, would you have kept it that way or would you have said, “All right, well, maybe we should raise some capital on year two or month six,” or would you have kept bootstrapping if you go back in time?

[00:08:05] Scott: It’s hard to say that you regret, because there were so many things I learned in that five years of being in the middle. There were definitely some of what I like to call Behance’s lost years, where we’re so focused on paying the bills and staying break-even that we didn’t invest in certain areas like DevOps, front-end engineering and mobile. We were a little behind because we didn’t have the money to do it. What we did do, is we built a very loyal team, we built a very solid strategy and we built the culture that was very much grounded in the reality of a tight budget and out executing our competition. I think that those things helped us succeed over the long-term.

[00:08:47] Cory: Are you technical, were you technical? Who built the site on day zero?

[00:08:50] Scott: On day zero, I definitely wasn’t technical, I was leading product, and we hired two early engineers. Our first three engineer’s actually Dave, Chris and Brian, two of which are still actually with the team and actually still at Adobe over 10 years later. They weren’t even qualified to do what they were doing at the time either, none of us were, that’s the crazy thing. I think we had to redo and rebuild, and there were tons of technical debt that we probably unnecessarily hick because we didn’t know what we were doing. We taught each other and taught ourselves how to play these roles. That was part of the magic, I have to say, in the early days.

[00:09:25] Cory: How did you meet those few people and convince them to join this, basically bootstrapped start up with little resources?

[00:09:32] Scott: Maybe they didn’t know enough to know better at the time, that’s very possible and we joke about that now. I’ll tell you what, I think a big part of being a founder is sales. Sales is something that we typically say, “Salespeople do these cold calling and whatever.” Actually, everything is sales; telling a narrative to your early employees, reinforcing that narrative month over month or year over year to keep the team together, telling it to investors to raise money, telling the customers to buy your product.

I think that’s one of the most important things that I did in those early days, is I’m always trying to refine and reiterate a vision of where we’re going and why and how we were going to get there, and when it didn’t work what we were going to change and really trying to understand and learn the logic. I’m very logic-driven and I try to always know the right questions to ask even if I don’t have the technical aptitude and know the answer. That’s how I led us in the early days.

[00:10:26] Cory: In addition to sales, if there’s another thing that you could pinpoint that has contributed to your success more than anything, what else do you think that would be and why?

[00:10:33] Scott: I think it’s certainly the attention to detail on the design and product front, and grounding our ambitions with product, not on our passion for the solution, but with empathy for our customers. I was always trying to just understand why would someone not using something, why were they using something, why were they using a competitive product. All of these obsessions, I think, if I look back, a lot of them were really tagged as empathy seeking.

I also always really, really prioritized, sounds obvious, but product concepting time. We would have a day every week where I would spend five hours just me and the design team. Then at some point, when we were ready, with the key engineering leaders just going over, laboring over every little product attribute and interaction. I think those meetings carried us through quite a bit.

[00:11:24] Cory: And now switch to the other side of the table by investing and working with other startups, what are some ineffective things that you see people do in 2018 right now?

[00:11:33] Scott: A few ineffective things that I see quite common in the startup world, one would be outsourcing design to a third party altogether, outsourcing product to different people. I mean, anything that is your competitive advantage, you must do in-house. You must build and develop capability in-house to do those things. Because a lot of the greatest breakthroughs happen at the margins. If you’re saying that design is important and product is important to your company, how could you have anyone else do that, even the first version of it?

It sounds easier to raise money and to hire another firm to do it, I just have not seen many remarkable products and breakthroughs come out of that model. I also think not really valuing the first-mile experience. I think another common thing I see startups do, is they focus so much on the core product experience and the features that they think are important, and then right before they launch they’re like, “Oh shit, we’ve got to do a first mile. What should the tore be? What should the copy be? What should the default state of the product be when people come in?”

They spend the last mile of their experience making the product. That last mile is the first mile of their customers experience using the product. Then they come back and say, “I don’t understand why the top of our funnel is so inefficient, why we can’t convert anyone?” It’s like, well, you didn’t spend any time on the only experience that all of your customers have. That’s another thing that I think a lot of startups get backwards.

[00:12:48] Cory: Now let’s talk little about Scott Belsky in 2018. What are some life hacks that you do that very few people know about? Or what is a life hack that you do very few people know about right now?

[00:12:58] Scott: Well, I think a big part of my life right now is context switching. I have been a very active seed investor over the years, and I’m still a venture partner with Benchmark and have a few things I do with the firm. Then I have my day job, which is now I’ve jumped back in to be a Chief Product Officer at Adobe and focus on helping these worldwide creative tools and systems become more modern and more accessible to more people. Which I think is a really exciting and valiant thing to do, and I’m super pumped about it. The challenge I always have is context switching between those things, and my writing and then other startup projects that just keep me on the cusp of learning.

How do I do that? I’m just really really ridiculous with my scheduling. Really, I’m very stringent about this period of time is for this and I schedule time also to digest things and consider them. I love being in the air because it forces me to just think and sketch. I think in this connected age where we’re constantly responding to our many inboxes of whatever’s coming into us and this being reactive to whatever is at the top, I think in this connected age, disconnection is a competitive advantage.

If you have a period of time in your day where you can focus on how to move the needle in an area that’s important to you and really read and digest, you’re probably in the minority of people that actually has that. Because by default, we don’t have it anymore.

[00:14:20] Cory: Do you schedule disconnection time?

[00:14:24] Scott: I do. Every week I do.

[00:14:25] Cory: How much? How often?

[00:14:26] Scott: Usually between five and eight hours, which is a lot.

[00:14:28] Cory: A week or a day?

[00:14:30] Scott: A week of absolute disconnection. Which I don’t know if that sounds like a lot or little, but it’s actually very hard to do when you have every team that you work with and where over 100 startups you’ve ever been involved with reaching out in various times asking for meetings and things, you just have to really compartmentalize.

[00:14:47] Cory: That makes sense. I want to go back and talk about some of the companies that you’ve invested in, you just said over 100 companies you’ve seed invested?

[00:14:56] Scott: Yes, over the last — let’s see, since 2010 was my first investment, so eight years.

[00:15:01] Cory: What was your first investment?

[00:15:03] Scott: My first investment ever was Pinterest.

[00:15:06] Cory: How did you discover that? What was your first meeting like and the check writing process like?

[00:15:10] Scott: Well, it was my first investment meaning that it was my only investment after Behance. I did it for maybe unorthodox reasons because at the time, I had no business being an investor as an early struggling founder of a startup. Then was also building a product with a grid, just like Ben was. He was very focused on getting designers engaged with his product. I saw, from my own analytics of Behance, a marked rapid month over month growth of visitors from Pinterest, I knew they would be a major lead gen for our product eventually. Even though at the time, stumble upon and, of course, other organic and search oriented ways were the major sources of traffic.

Also, I wanted a west coast network, I wanted to be involved with some companies that are on the other side, because we were based in New York, that I could learn from. Ben that came from Google and had a great network, and I felt like, “Well, if I can be an advisor to him, he’s asking me for assistance on the product and first-time user experience and some of the marketing copy and stuff like that, I can also learn a lot from him. If I invest in his company almost as like a price of admission, then great.” I went ahead. with the investment. Certainly, Pinterest has outperformed my wildest expectations in terms of what it ended up becoming.

[00:16:18] Cory: Did you have any idea?

[00:16:20] Scott: No. Although I always was blown away by Ben and, certainly, as I met many more founders since. They were just very few as thoughtful and patient and strategically inclined as Ben.

[00:16:20] Cory: Are there any unusual common traits that you discovered between people like Ben and the founders of Warby Parker and Uber or successful companies that you’ve backed?

[00:16:41] Scott: Yes. A couple things aside from the obvious but hard to do, which is really have a design-driven approach to product or even a designer founder like Ben had. I think another one is to be as focused on optimizing process as they are on product and business. Everyone always talks about making a product better and A/B testing and everything else, but not a lot of the founders are always thinking about their own organization as a product. “Well, we’re going to test having this person lead this instead of that person. We’re going to test not having this meeting anymore and try this approach instead. Every year, we’re going to try new tools.”

A lot of these people — and Ben was always this way, I remember six or eight months into being an investor in the seed stage of Pinterest, checking in with him and being like, “What’s your plan for the next 6 to 12 months?” I was expecting a roadmap. Instead, he said something on the lines of, “I just want to figure out and establish a better process around — “ I forget what particular area of his business. I was so struck by the fact that his objective in that time-period was process-oriented. That, I think, is a best practice.

[00:17:52] Cory: And you’d see that when you’re meeting with founders, is that like 10% of the time or even less than that?

[00:17:58] Scott: I would say it’s less than 10.

[00:18:01] Cory: Well, just a few more questions. What’s something you know you should do right now but you haven’t done yet?

[00:16:51] Scott: Let’s see. Gosh, live abroad for a year, that’s one thing I should do at some point but I haven’t done yet. Also, have a little more time for the artistic side of me, which I just have willfully neglected. I’d say those are two things.

[00:18:19] Cory: How do you find untapped talent or diamonds in the rough?

[00:18:21] Scott: I just try to follow my curiosities when it relates to both investment opportunities as well as people to hire for my own projects. Things that I’m deeply curious about, I find other people that also share those curiosities and are contributing in some way. I try to tune in and measure people by their content online, what makes me think of something differently and what pushes my imagination, and then I want to meet these people and learn more from them. In my experience, those efforts tend to lead to opportunities; whether it is to work with them or for them, or they work for you.

[00:18:58] Cory: Who are three people that you think are undervalued right now, or aren’t getting the credit that they deserve, or that you think will be Uber-successful that maybe aren’t yet?

[00:19:06] Scott: It’s hard to pick. I’ll just think about interactions I’ve had in the last few weeks to answer that question on the investors’ side. I’ve always been a huge fan of Semil Shah. He has this very, very tiny fund called Haystack. He’s a very underrated person in that community. He just works as an owner-operator. A prolific writer, everything he writes is interesting. He has a tremendous portfolio that I think people overlook. Hunter and Satya from Homebrew, I would say are also similarly underrated sometimes in the investing world.

In terms of founders, there’s a bunch of companies that I would say. Sam Hashemi, who’s a CEO and founder of a company called Remix which is doing software for designers of cities, this is someone who literally is building software that bus systems in over 250 cities around the country are running on. When you think about what sorts of new technologies could transform the way cities work in ways we don’t even anticipate with our current thinking around companies like Uber, I think Remix is one of those.

Ben from Amino. Amino is like a long-tail of very niche, very highly engaged communities. Ben Anderson, another founder and CEO. There are a bunch of folks. Alison Wood is a woman who’s running a really cool company called Camera IQ out of New York that’s thinking about AR space. She’s one of the greatest underrated thinkers in AR world, another person that just comes to mind.

[00:20:29] Cory: Well, thank you for sharing that. Switching real quick back to Behance, did controversy play a role in the success of Behance in any way?

[00:20:36] Scott: Controversy, well not necessarily. Although, one of the things I always believe and still do is that if you’re a community, you have a responsibility to use that role at the epicenter of an industry for good even if it’s not for profit. A lot of that is with advocacy work. One of the examples of Behance that was also often controversial because we were fighting against a lot of startups that were doing this, we were always adamantly against spec work, this idea of a platform like 99designs or others basically going out to a community designers and saying, “Hey, everyone do this logo and one of you is going to get paid for it.”

Because if you do the math, literally years of 24/7 labor is wasted off of a small prize that only one person gets. We were very against that. I remember being on panels fighting with the CEOs of these other companies, founders of — these crowds sourcing companies that were saying, “This was good.” I do think that that example of controversy helped define Behance and its values. People knew what we stood for oftentimes, by seeing what we were against.

[00:21:44] Cory: What about some of the work or artists that were on Behance, was there any art that was controversial?

[00:21:52] Scott: Oh my gosh, all the time. The artistic expression is all about pushing edges. We did, we always tried to have a safe space. And since the acquisition by Adobe, the team was very focused on making sure that we still were pushing the envelop and were supporting artistic expression even if it was controversial.

[00:22:13] Cory: Has that been challenging in some regard or no?

[00:22:19] Scott: It hasn’t been. It hasn’t really been because we are very transparent about what can be displayed, where and why. We have to obey by certain laws and there’s certain things, for example, you can’t show in India or Germany that you can show in the United States. We just try to rather than delete it from the world, we try to really develop systems to allow each country to have the maximum artistic expression available by law.

[00:22:41] Cory: How do you think artists should deal with controversy? Do you think they should seek it or just not shy away when it comes up?

[00:22:49] Scott: The tolerance for controversy has to come from authentic creative expression. When someone’s just trying to get everyone’s feathers riled, I don’t think that comes across well nor has lasting value in the world of art. But when someone expresses themselves and is shunned for it, I think they are ultimately celebrated. Even if they’re shunned their first, because it’s an observation of what’s real. It’s chronicling a real energy in the world, not a fake one. At the end of the day, people come around.

[00:23:23] Cory: When was the last time you broke the rules or pushed the envelop, not necessarily broke the law but — ?

[00:23:29] Scott: Well, one of my mentors is this guy Seth Godin. I try to connect with once a year. He’s a great author and thinker and he always likes to say — oftentimes when I say goodbye to him, he’s like, “Keep causing some ruckus.” I always say that in my head when I’m in a meeting. Now at Adobe, in a big company, trying to lead some changes in certain areas and there’s an elephant in the room that no one wants to talk about, I say to myself, “Scott, speak up.”

I think now the ruckus that I cause or the “rules” that I break are really within an established norms and culture in an industry that’s rapidly changing. We got to think about what’s the future of AR. What’s the future of experience and interface design? We can’t rest in our laurels nor stay routed in necessarily connected to the culture of yesterday. There’s evolution that has to happen.

[00:24:20] Cory: Any favorite book recommendations or podcast recommendations for someone just starting their career?

[00:24:28] Scott: Gosh, well your podcast is great. You already know that. I’m a big fan of Tim Ferriss as well. I like the ones that Reid Hoffman during these days. I just read this book, Tribe, by Sebastian Junger, which is really about just default nature of humans to want to be together and the role of community, which I encourage people to read.

[00:24:45] Cory: My last question is, is there anyone you’d like to thank on this show that’s helped you?

[00:24:50] Scott: That’s helped me over the years? Gosh, so many people. I think there are people like Beth Comstock who formerly Vice Chairman of GE who was one of our first big clients at Behance, and first made me believe we can make it as a sustainable business. People like John Mayeda and Seth Godin, who I just mentioned, who’ve been like mentors over the years and in important times have really helped me out.

People like Fred Wilson and Albert Wenger from Union Square Ventures, were the first folks to invest in me, and the partners I’ve worked with at Benchmark who’ve taught me so much about that world. All the founders, gosh, come on, don’t get me started. Anyways, I am very grateful, realize always and remind myself that most of what I’m excited about I would not have if it wasn’t for a lot of other folks who gave me a chance.

[00:25:50] SHOW CLOSE

Listen to every episode of OFF RCRD on iTunes and stay up to date with the show at OFFRCRD.com.

I met Kevin when he spoke at the first NextGen Conference in 2009, which is now Internapalooza, and we’ve stayed in touch ever since. I interviewed Kevin on my OFF RCRD Podcast to talk about the start of Eventbrite, his journey as an entrepreneur, advice for fellow entrepreneurs, and more.

Here are my 10 favorite quotes from the interview, which you can listen to in full here.

• “I went overseas and got a Masters in British history at Oxford in George the third. Something totally kind of off the reservation in terms of having any bearing on tech, but it was an opportunity to kind of learn how to learn.”
• “There were times where we had massive broad attacks, where fraudsters were trying to steal hundreds of thousands of dollars, we had very aggressive lawsuits by competitors, we had just a myriad of things.”
• “As we grew, my job really became talent acquisition. Always more than half my time was spent recruiting and finding great people.”
• “When you’re building a business, you really want to think about what special advantages can I have that will give me an uneven playing field to hire and retain the best talent.”
• “I think just having other founder CEOs to share ideas with is really critical.”
• “Typically when you see something that is non-standard, instead of kind of turning away or rejecting it, really try to understand or embrace — it is important.”
• “I look very carefully at the backgrounds of founders to understand what really motivates them, that they’re going to really want to win, and that they have the intellectual capacity to make the right decisions.”
• “My theory, and sorry to all those parents out there, is not to listen to your parents or do exactly opposite because parents have this need to protect their children it’s this and they need.”
• “They (Kevin’s parents) thought it (starting a company) was crazy. They thought I was throwing my life away.”
• “I get extremely frustrated when somebody is not really tackling a problem that really matches their intellect and skill, I would point to really assessing.”

Listen to the full interview with Eventbrite Co-Founder and investor Kevin Hartz here on the OFF RCRD Podcast.

Building a successful startup takes a lot of hard work, time, money, and guidance. Throughout my short journey over the past several years, I’ve relied a lot on investors because of their wide base of knowledge and experience each working with hundreds of entrepreneurs.

When I started my podcast OFF RCRD late last year, I decided to ask venture capitalists for their advice for young entrepreneurs, not only for my own benefit, but to help those who are just getting started avoid some of the mistakes that I and many others have made. Here are eight pieces of advice from leading venture capitalists for young entrepreneurs.

• “You really, really need to want something very badly. You want to see your problems solved, you want to see a product exist in the market, and make sure you recruit others, at a very early phase, that are like you.” — Niko Bonatsos, General Catalyst
• “Knowing what the one thing is that you need to get right, and working on that, and pushing everything else aside is critical to making a startup succeed.” — Albert Wenger, Union Square Ventures
• “At the end of the day, having a great start-up boils down to picking the right team in a great market…It’s really hard to figure out who the right team is, you almost have to be snobbish about it.” — Naval Ravikant, AngelList
• “Generally, if you’re thinking about marketing and branding, and trying to grow through marketing and branding and PR really early on in your life-cycle, it’s indicative of not having your product right.” — Ashton Kutcher, A-Grade Investments
• “I think my life hack is using other people to help me and building a family and a team. It seems counterproductive, it’s not technology, it’s human, but it really is my hack.” — Gary Vaynerchuk
• “The only thing you can do as an entrepreneur is to get one more person every day, every hour, every minute, to adopt your product, to adopt your new way of thinking, to adopt the system or the product that you’re actually building and engaging people with.” — Josh Elman, Greylock Partners
• “I think one of the biggest mistakes people make is not selecting the DNA of their core team to be appropriate for the market and product they need to build.” — Keith Rabois, Khosla Ventures
• “When you want to study a product, fundamentally what you’re doing is you’re trying to study users and try to understand users. To understand them, I think you have to understand people; users are people.” — James Hong, Angel Investor, Founder of HotOrNot

What piece of advice would you share with young entrepreneurs? Share yours below, and catch up on each episode of OFF RCRD here on OFFRCRD.com.

No entrepreneur is the same, but those who are able to accomplish their lofty goals all have a few things in common. While working in startups leading up to the founding of After School and over the past five or so years serving as the Co-Founder and COO, I’ve tried to emulate the traits of entrepreneurs and investors I admire, and surround myself with them.

One of those I’ve learned from is General Catalyst Managing Director Niko Bonatsos, an early investor and advisory board member for Snapchat and others. On my podcast OFF RCRD, I asked Niko what he looks for in an entrepreneur. Niko said that every entrepreneur needs three things:

1. Unrelenting Desire

Every entrepreneur I’ve ever met is passionate about something in their lives, but not all of them want to desperately solve the problem their startup is focusing on, which is critical according to Niko. “You really, really need to want something very badly. You want to see your problems solved, you want to see a product exist in the market, and make sure you recruit others, at a very early phase, that are like you.”

In my experience I’ve found this to be true as well. I’ve worked on projects I’m not passionate about early in my journey and have also been on teams where half of the team isn’t sold on the direction the startup is headed in. It wasn’t until I teamed up with a co-founder who was as dedicated and passionate as I was that we started to get traction.

2. Ability to Understand and Limit Potential Bottlenecks

Before becoming a respected investor, Niko was also the founder of a startup that was being built on top of LinkedIn. “We underestimated the platform risk,” says Niko. Because their startup relied on LinkedIn, the company had little control over the platform, meaning LinkedIn could make massive changes in an instant that could end severely limit what the company was able to do.

“Truly, truly understand that some of the decisions you make early on may limit your future growth potential or be a bottleneck for what you want to do down the road,” says Niko. Be cautious to trust any of the core functions of your business to another company and make sure to fully think through decisions that could hurt your startup in the future.

3. Be Patient and Empathetic

Snapchat grew quickly once they found a market for their app, but the company didn’t develop overnight, and neither did After School. We’ve made dozens of pivots and iterations over the past five years to get where we are, and we have been lucky enough to build a team and group of investors who understand how hard our jobs are and that large companies take time to build. “It’s really hard to be a founder. You have to learn a lot of things. Your job changes every few months. Things are not always rosy. It takes a long time,” says Niko. “(just because I’m an investor) doesn’t mean I know more about that space and I deserve to be arrogant, impolite, cocky, and all that stuff.”

Listen to my full interview with Niko Bonatsos here, and visit OFFRCRD.com each Tuesday for new episodes.

Because of the super high quality of the content during our first interview, we decided to provide the full transcript. Follow Keith on Twitter @Rabois, and listen to every episode of OFF RCRD here.

Cory Levy: How did you become an entrepreneur?

Keith Rabois: I started my entrepreneurial career in an odd way. I was originally a lawyer. I went to Law School right out of college, and I practiced law for several years. I was persuaded to join Silicon Valley’s entrepreneurial world by friends of mine from college.

After many years of lobbying, they eventually persuaded me to give it a shot. I sort of dropped off the face of the planet from a legal perspective and jumped into the crazy world of Silicon Valley.

CL: What were your high school days like?

KR: Pretty boring. I was on the classic pre-law/government trajectory. I focused mostly on getting good grades so I could get into a good college. I joined the debate club, school newspaper, and played soccer.

CL: Run us through what a day in your life looks like? Do you have any specific morning or afternoon or evening routine?

KR: I’m a big advocate of sleep. I’m very obsessive about getting enough sleep everyday. I organize my life backwards around that. I do focus a fair amount on soccer or weight training, or some combination of high interval training and reading. I’m trying to package my work around sleep, one or two workouts, and reading everyday.

CL: How many minutes or hours a day do you read or workout?

KR: Workouts vary, between as short as 20 minutes to as long as an hour and a half. With reading, I try to read a minimum of 20 minutes up to about 60 minutes on a daily basis.

CL: What would you say your biggest challenge is right now, either professionally or personally?

KR: There’s only so many hours in a day. Time is your most precious resource.

The most important lesson to learn is to value your time. I think most people undervalue their time. You can always find more of other resources, but time is the main asset. One of the biggest challenges as an investor is that the more investments you make and the more boards you join, the less time you have to find new opportunities. If new people reach out to you or there’s a bunch of innovation in a new area, it’s very difficult (to take advantage) when you have a lot of pre-existing commitments, and there’s a trade off there.

CL: Where do you see founders, employees, or other VCs wasting the most amount of time?

KR: One of the worst things you can do is read the internet. I think most things written online are not worth reading.

I subscribe to the view that, one should read real books as opposed to blogs or current events. Second, I think conferences and other social gatherings (are a waste of time. It’s not a very high leverage use of your time. When I was an entrepreneur, the only time I would attend conferences and social events is if they had a disproportionate pool of talent that I could recruit from. So everything I was invited to, whether it was a party or a conference or speaking opportunity, it’s filtered through the lens of other people I want to recruit. If the people I want to hire are going to be attending it, then that’s a useful investment of my time; if not, I shouldn’t do it.

CL: Let’s talk a little bit about that. I know you said once that you try to hire geniuses that no one has ever heard of. How do you find these groups of people? Is it university engineering programs; is it outside of San Francisco; how have you found that untapped talent?

KR: There are two elements to finding people who have extremely high potential that are undiscovered or unproven.

One is assessing of people you meet, being able to calibrate them.

The second is creating a magnet for people that you wouldn’t otherwise meet. The first element is understanding. When you do meet people, whether it’s at a social event, recruiting event, online, or even just reading tweets or Quora, how do you identify that spark that you’re looking for? And then, secondly, once you have that skill develop it, is there a way to scale it so that you can meet more people?

Scaling it (can be done) through friends or friends of friends. Basically, people tend to identify with and invest time and energy with people that are somewhat similar. If you can find a pool of people that have unusually high potential, they can probably be pretty good filters and magnets for other people that have similar characteristics and caliber. I think that’s one way to scale it.

Surely, there are things like marketing. Whether you use formats like Twitter, Reddit or Quora. There are ways of trying to become a magnet for talented people. That’s quite challenging in and of itself.

CL: Today, who are some of the people that you can name that you would say are untapped or that you’re developing a mentor-mentee relationship with?

KR: Well, you always try to find new ones. Truthfully, it gets harder as you get older because, obviously, there’s a bigger disconnect between your natural networks and networks of up and coming people. It takes more effort, energy, and creativity. I wrote a good example of this. I wrote a post in March of 2010 or so about two of the most highest potential people in Silicon Valley in their 20s.

Even though now it’s seven years hindsight, it still reads pretty well. To be able to do that is pretty challenging. A lot of the best people I’ve hired had very erratic backgrounds, mostly from non-elite schools, most with non-technical backgrounds. They’re very far off central casting. That’s the way you have to develop a company or create a great pool of people who you invest in their very early stage if you want to be the angel investor, for example.

CL: What would you say you’ve learned most from those people; those good hires that you’ve made that didn’t come from elite schools, and didn’t come from Google or Facebook?

KR: I think the most important thing is that they’re unlimited, unbounded, outside potential. The opportunity to invest, for example, is really attractive because there’s not everybody else chasing after them. But, more importantly, the opportunity to hire them is more accessible as they started out being the entrepreneurial executive of a startup, because they’re not going to get the same offers from Facebook or Google. They’re not going to get ridiculous salary offers. They don’t have everybody else chasing after them.

For example, a CS student from Stanford is incredibly overrated in terms of demand for their talent versus what they can actually do on average. You have plenty of people throwing money at them. They don’t always develop the best work ethic because of that. They think they’re entitled. There’s a lot of things that go wrong when everybody in the world is chasing after you.

What you want to find are people that other people aren’t chasing after but they have even more talent and more grit. That’s doable, but it’s hard. It’s a little bit like drafting athletes in various sports. There clearly are first-round draft picks and early first-round draft picks that have all the raw ingredients, but everybody else often knows they have all the raw ingredients for success also. You need to find the Tom Brady’s, who was a sixth round draft pick and be right about that. Tom would probably be the best quarterback of all time.

CL: Got it. I’d like to play a quick game. I’m going to list four people you’ve worked with and then I would like you to share one or two of the biggest things you’ve learned from these individuals. The first one is Peter Thiel.

KR: Yes, so I’ve probably learned more from Peter than from any other person. Peter actually taught me me most of the philosophies about hiring and recruiting undiscovered talent. He literally taught me when he would take me to jogs through the Stanford campus in November of 2000, after my first week at PayPal. He explained his philosophy of the only way to scale a startup, which is to be able to become a magnet for talented people and be able to asymmetrically assess people. Otherwise, you’d never be able to compete with the incumbents.

CL: What have you learned from Max Levchin?

KR: I have two great lessons I learned from Max Levchin to share. The first one is how rare it is to find a world class technical talent infused with first-rate business strategy. Because that’s what makes Max so exceptional. There are lots of very smart technical people and a fair number of smart business people, but to combine them in one brain allows you to make different kinds of decisions.

The second thing is, very critically, he has lots of manifestations and important implementations across lots of successful companies. It’s a little bit more well known now than it was in 2000 when Max invented the concept of combining machine learning with the human eye and building a complex system that integrates both and leverages the humans and the machines for their best skills in a synchronized way.

That’s something Max taught me the brilliance of and then I’ve used that in other companies I’ve been involved in, from Square to Opendoor, as examples.

CL: Very cool. What about Reid Hoffman?

KR: Reid taught me the strategic uses of time. Not about how to leverage your own time, but that time is a dimension to negotiation. For example, time can be your friend or it can be your enemy. Understanding whether time is your friend or your enemy allows you to change the dynamics or change the dynamics of a negotiation or a situation. Always understanding where time is and who it affects and who it affects in which way.

CL: Two more to play. One is Jack Dorsey.

KR: There are probably several things I would say. The first is how much details matter. It’s easy to say that details matter, but at the end of the day, most people in practice don’t focus on them and it steps on them and how you can craft the product, the company, the culture based upon that principle.

Like in 2000, there’s Apple and like the early employees there. I think Jack took the Apple philosophy, tweaked it a bit to make it modern for the 21st century, and built Square in that way. Then, this taught me the benefits of design-oriented thinking, down to the detail level in every dimension.

CL: Lastly, how about Vinod Khosla who you just started working with?

KR: The most important thing I’ve learned from Vinod is an adage he expressed when I was on the board of Square. He had a philosophy that the team you build is the company you build. That really instilled the importance of recruiting and talent and your reformation DNA of a company better than any one thing I’ve ever heard or any other paradox I’ve heard from anybody else. I repeat that all the time.

It’s really important when you’re starting a company to put that into place. Patrick Collison has another way of saying it, which is, “The reason why the first 10 employees are the most important is every one of those 10 employees is going to replicate him or herself 10 times.” If you set the foundation right, you’re setting the foundation for the first 100 employees and it reminds you how important that is.

CL: For a first time entrepreneur trying to set that foundation correctly, what would be your advice to assess that? How can they know if they have the right flow, if they have the right 10 employees? Do you think it’s just a gut reaction or do you think there’s some science behind that?

KR: There is some science. I think it depends on what you’re trying to achieve, what product you are trying to build, and what market you are competing in. So, for example, the DNA that you will need to correctly build a payments company is probably different than one you’d need for a photo sharing company, which is different than what you need if you’re going to compete with SpaceX. So first, thinking through what are the key risk and key issues and key leverage points in a particular business and market that I’m going to be in.

And then, do I have first-rate world class talent in those core areas that can compete on those dimensions with an asymmetric advantage? First, taking stock of what your skills are as a founder. And then, what is the product I’m trying to build and who are the other people that compete with me? In what areas or what dimensions do I want to compete on? Making sure that my founding team, whether it’s the first two or three employees, first five or first ten, have world class talent and skill in the two to three or four key areas.

CL: How do you make hard decisions? Whether it’s leading a big round of financing or joining Khosla or joining Square, how do you go about making your very difficult decisions? Is it regret minimization? Do you have any tactics around that?

KR: I think a couple of techniques, although, truthfully, none of them are perfect. I think all those decisions involve a fair amount of sleepless tossing and turning, and chewing on things. I’m not particularly great in divorcing emotion, body reaction, from those kind of decisions. A couple of techniques, one I learned from Reid Hoffman. First, you don’t make a list of pros and cons; that’s not a great way to make these kind of decisions.

I think the best way to make a decision that he taught is to figure out your number one priority, and optimize on that dimension. If your number one priority is, let’s say, impact, then figure out which of the choices will have the most impact. If your number one priority is people you work with, then which one is more compatible? If your number one priority is making money, then figure out which one (decision) is most likely to make you money.

But don’t try to have this like multi-factor, multi-pronged approach — that’s a really poor way to make decisions. So try to rank-order what’s the most important. If there is a tie, then obviously, you have to go to your second most important (priority). But often, you can make decisions on just one. In addition, I actually do ask people for feedback. Not only on the topic of the decision, but I’ll generally bounce some ideas off of the people that I think are really wise and sharp, and get a spidey sense reaction from them.

So, for example, when I was thinking of joining Square versus starting my own company versus joining a VC back in 2010, I asked several people I trusted about Square and what they thought. I got the feeling that there was potential there, that there’s an energy there. That if I joined, I might be able to recruit people because people are reacting positively. So I always try to do that, which is I’ll reach out to people that I’ve worked with before. I’ll reach out to people that are up and coming stars and tell them the X Y or Z, and see how difficult or how easy it feels to be able to recruit them, and that’s a good proxy.

Then, to some extent, there is a somewhat silly approach. At the end of the day, sometimes I’ll just flip a coin. You get this emotional reaction which forces you to have a binary decision. If you really don’t like the decision, you’re going to overrule the coin anyway, but it allows you to come to a binary sort of decision out of what you really feel.

CL: I like that approach. Back to number one priorities. What would you say your number one priority was when you graduated from college?

KR: I think it was mostly around getting involved in law and politics, succeeding in law. It’s a pretty competitive, somewhat zero-sum profession as a litigator, and then, eventually transitioning into politics. It doesn’t mean that you can’t change your priorities over time.

CL: And what would you say your number one priority is right now?

KR: Number one priority right now is using new technology and using a platform as an ambassador to lead the world forward and change the world in ways that I want to. Empower people to have a shot at changing the world in the ways they want to by giving them access to money, advice, mentoring. Using the opportunities I have and the resource I have to propel people and the world forward through people, and that mostly means through technology start-ups.

CL: What would be your advice to someone just graduating school, who’s not sure what they want to do yet, what would you say to that student?

KR: The most important thing is to identify — and it may take days, weeks, months, sometimes years; hopefully, not too many years — to figure out what you can be exceptional at. I don’t think you want to be one of many people, you want to be the best at what you do even if it’s defined very narrowly..”You want to be the only that does what you do to,” to borrow a line from Jerry Garcia. Figuring out where your competitive advantage could be and where you want it to be and then developing that so that you are the best at what you do, and the only one who does what you do.

That may take some time because you may have to try to do several things and figure out which one’s worth doing and which one’s aren’t. You may be wrong about what you thought you’d be great at, you might get feedback sending you in a different direction. But once you get that, it’s pretty easy then to figure out what to do with your life.

CL: I want to spend a little bit of time talking about controversy. Is there a time when either you were working with a founder or you were at a company where controversy played a part in success?

KR: Well, I mean I think most start-ups have some elements of that. In fact, actually, I think it can be a good tool as well. Most good ideas feel edgy or borderline dumb to many people. One of the tests that I like to use with good early stage founders and investment opportunities is, “Are enough people laughing at it?” If everybody thinks it’s a good idea, I suspect it’s not really that good of an idea, and so I like to hear people ridiculing an idea or thinking it’s absurd.

Eventually, you have to prove that you’re right, that it’s actually possible to do X Y or Z, or that the consumers should care about X Y or Z. In the beginning, it’s better to have that degree of controversy where people think it’s either dumb, stupid, annoying, or something like that.

CL: Can you share a story of where that was prevalent?

KR: Yes, one example not from my own experience but just watching from afar, is Uber’s surge pricing, for example. I think what was underrated about it was all of the controversy in the media about it was actually just leading to free growth. The more stories the media would write about surge pricing and people whining about surge pricing was just leading lots of Americans who had never heard of Uber, didn’t even know it existed, to be aware of it, and that kind of free marketing is incredibly valuable.

CL: What’s something that is controversial today that you think won’t be in the near future?

KR: That is really a good question. I would have said about a year or two ago, maybe even three years ago that autonomous vehicles would be incredibly popular and widely accepted, but that’s already moving to the mainstream and already widely understood.

But I’ll give you one that’s a little bit more controversial still today, which is I suspect that most of healthcare in the future will be delivered and diagnosed through math and not by people. This is going to be so much better at diagnosing most people. Faster, cheaper, accessible. Let’s say our kids are growing up, they’re going to go to a machine to be diagnosed, not to a human.

CL: I’m excited for that. How do you think (young entrepreneurs) should deal with controversy? Do you think they should shy away from it, seek it, or just not back away when it comes up?

KR: Well, I think obviously this is case by case. Not all controversy is good and most controversy is not bad. I think, for example, the whole goal of an entrepreneur is to change the world, right? There’s some market or something that has a lot of inertia that’s done the way it is, that you’re trying to change. By definition, you’re taking a sharp knife or something and trying to disrupt the inertia, and that’s going to be somewhat painful and it’s going to cause so much friction, noise, something. So I think it’s pretty good to have some degree of controversy about what you’re doing when you’re going from zero to the end goal.

That said, once you’re succeeding, once you’re creating a network effect, once it’s working, you may want to diminish some of that controversy. Because you’re becoming more like the navy than the pirates. So knowing where you are on the success curve is important. But at the beginning, when you’re starting, you’re going to say, “I’m going to change the world.” Everybody’s going to think that’s absurd and the truth is that you’ve got to change a lot of things, and change is dangerous. Change is scary. Change can be painful. If you don’t change a lot of things massively and fast and quickly, you’re not going to be a startup that anybody remembers.

CL: We’ll finish with a couple final questions. What’s something you know you should do but you haven’t done yet?

KR: That’s a great question. I think I’ve taken some steps recently to try to crack one of them. I’m trying to figure out how to scale myself. It’s something I knew I needed to do; it’s a problem for all VCs. There’s not a lot of successful models of how you gain leverage of your time, which per my point earlier, your time is often more valuable than your money.

I kept delaying and deferring how to scale myself because there wasn’t a proven model that had darwinistically evolved versus scaling myself at a company where there’s a lot of ways, and evidence of how do you do that.

So I kept deferring it. Recently, in the last four months or so, for the first time, I started taking some steps to do it; but I really should have done it four and a half years ago and then I would have been further along the path with leverage of my time, or experimenting into different approaches with more feedback already under my belt. I delayed it because it was hard. I procrastinated because I didn’t have a ready set of answers. But, the only way you get the right answers is by starting the process.

CL: What process did you start, what are some of the experiments that you did to try to scale your time?

KR: I have hired a “Chief of Staff” for the last four months and I’m trying to see if I can take advantage of other talents and teach people to think similar to me in various ways and create leverage off that. But it’s a work in progress and there’s lots of questions around it.

CL: One of the biggest challenges and questions that people wrote in when they applied to come to Internapalooza was there was a big struggle regarding them meeting people to get hired, meeting people to start companies with. The biggest challenge they had was, “How do I build a network?” A lot of these people are in middle America; they’re in indigenous schools across North America. What would your advice be to those students?

KR: Yes, I think it is challenging because the density of opportunity — the density of network does matter. Geographic proximity is an absolute advantage, that’s why we tend to see Silicon Valley being a hub of startup innovation. Hollywood being the core for filmmaking in the United States. New York for some other industries. There is a rational reason for that, it’s also become self-fulfilling a bit.

One way around that is with the proliferation of various social platforms, whether it’s Twitter, Reddit, Quora, Medium. There is an opportunity to be incisive and insightful and get noticed. I think one way to cut through in developer relationships and be in demand where people want to meet you actually, people with proven expertise and ability, is to write interesting things.

Ben Franklin had this great quote which I’ve always used as a guide for my own decision-making and career. It’s, “Two ways to be successful in life: do something worth writing about or write something worth reading.” Maybe start with writing something worth reading.

CL: I like that. So you started Opendoor recently. I’m sure there are some other companies that you wanted to start, some other problems that you wanted to solve. What would you say those problems are if you are willing to share?

KR: Sure, yes, I actually do have some other areas that I’m pretty fascinated about, three in particular. One is the area of cyber insurance, I think it’s ripe for innovation, and over the years, it’s becoming an increasingly important problem. Number two is life extension. I think given current technology and current scientific knowledge, it actually isn’t that difficult to on average, extend people’s lives by 5 to 15 years. The question is how, what products, what applications, what feedback loop do you want to deploy to do it?

I think if you get outside the 15-years time horizon, it’s still science fiction land. Immediately, like right now, we could build products and services that would extend people’s lives in a meaningful way.

Then, third is another area that strikes me as completely underinvested in — achieving goals, like a software-based feedback loop to achieve various goals. Whether it’s to be healthy or happier, wealthier, whatever the case is. There are books that have been written for centuries on how to be more successful, how to live better, how to be happier. Some of the books are pretty good. The best-selling section in any bookstore is the “self-help” area. Some of the books are pretty superficial but a lot of the content actually isn’t.

But a book is written for the average audience. It doesn’t adjust to who you are, where you are in your own life, and provide custom advice based upon what you’re doing or not doing. That’s what software is great at. Someone should be able to build the product that’s software-based, that helps you achieve your objectives, and I really want to work on that one.

CL: What are some of your favorite self-help books or the ones you think do really a good job?

KR: Since I’ve been on this crusade of building a company like this, for the last year and a half, I’ve collected a bunch of books. I have a library at home, but I have a special shelf in my office for just these kind of books. It turns out that none of them are amazing across the entire book, but many of them have chapters and insights. So I’m stitching them together, and then personalizing it using software.

For example, a book that’s way underrated but super critical is the book called, The Upside of Stress. I think it’s incredibly revolutionary and in how one approaches one’s and how one get to be successful. But I think there is a lot of ideas in all these books. Some of the books and more are more well known. Tim Ferris has a book, Tools of Titans, which collects a lot of advice from successful people, to some very obscure books which I’m sure nobody has heard of. I’ve been trying to combine them all together and then eventually apply it out to software.

CL: Very cool, and then my last question, what are some crazy stunts or marketing things that you’ve seen people do to get attention?

KR: Yes. I’m generally not a huge fan of these things. I think the only ones that really are effective are pretty organic and pretty natural to the product. Depending on what the product does, there can be a natural implementation that is effective. For example, I think the Lyft Mustache was relatively effective in creating proof, social proof that, “Wow, this ride sharing thing was something normal people were doing.” And making it feel comfortable, safe, reliable. Because you can see, at least in San Francisco, the increasing velocity of mustaches floating around which made you feel more comfortable.

It also showed perhaps there’s a fair amount of liquidity, like there seemed to a lot of cars on the road. Something like that I think is a fairly effective technique. I don’t like the stunts that are designed to be outrageous. Another natural, organic example was when we first launched Square. People would notice the well designed square, a little white squared device to be plugged originally into your iPhone or in your iPad.

That would pique their curiosity, it was unexpected that they could use their mobile device to accept payments and credit cards. The device itself generated attention because it was thoughtfully designed, elegant, reinforced the brand, created curiosity around that. That would lead to a set of new customers discovering the device everyday. If I was in a taxicab and saw Square for the first time, I’d be curious about “what is that?”

Or, if in the coffee shop, if I encountered it for the first time, I might ask the barista or the proprietor, “What is that, how do I get one?” That led to a fairly significant organic growth rate for Square.

CL: Do you have any goals (1, 3, or 5 years out)? Do you have any high-level things that you’re trying to accomplish personally?

KR: Not necessarily at that level. I would like to continue the journey with Opendoor, so it’s natural. I think it should be a very successful, and a very important company. It’s still a work in progress right now.

It’s very promising work in progress, but I would like to see it as a public company that’s very successful in 20, 30, 40, 50 markets all across the United States and it’s really reoriented the way people think about selling their house. I think getting another company or two off successfully, in either life extension, based on really extending the active years for people, or allowing people to achieve their goals through software — getting those into the market would be pretty important, and in each case, really helping people.

CL: Is there a question that you ask founders pitching you that generally, people are quiet and think a lot about?

KR: Yes, I have a pretty standard question that sometimes surprises people when I’m interviewing them. Whether it’s interviewing them for a job or executive role, for founders too.

The question is, what do you want to do with your life? That’s usually my first question. Sometimes it catches people off-guard, but it allows you to quickly understand who they are, what they care about, and calibrate your feedback.

If I’m asked for advice, “Should I do this or that?” Often, the answer is, “What do you care about, what do you want to achieve, what is important to you?” There is no abstract answer. It’s more a function of what’s important. So, I usually start there, which sometimes surprises people.

CL: Cool. Well, thank you again for being on the show. I appreciate it Keith!

Please visit OFFRCRD.com to listen to my podcast with Keith Rabois, Ashton Kutcher, Kevin Hartz, and more :)