The Jordan Harbinger Show - 270: Ben Horowitz | What You Do Is Who You Are

Episode Date: October 29, 2019

Ben Horowitz (@bhorowitz) is a founding partner of superstar venture capital firm Andreessen Horowitz, and the author of NYT Best Seller The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers and his latest, What You Do Is Who You Are: How to Create Your Business Culture. What We Discuss with Ben Horowitz: What the Haitian slave revolt can teach us about creating a thriving, resilient company culture from chaos. Why a company's culture -- for better or worse -- will endure in the memory of the people who work there far longer than the consequences of a bad quarter. The disasters that strike when a company's core values and culture reveal their dark side. How prison culture influences the way some billion dollar tech companies are managed. Ben's possibly surprising musical preferences and how they fuel his own creative direction. And much more... Full show notes and resources can be found here: https://jordanharbinger.com/270 Sign up for Six-Minute Networking -- our free networking and relationship development mini course -- at jordanharbinger.com/course! On No Dumb Questions, a science guy from the deep south (Destin of Smarter Every Day) and a humanities guy from the wild west (Matt Whitman of The Ten Minute Bible Hour) discuss deep questions with varying levels of maturity. Give No Dumb Questions a listen here! Like this show? Please leave us a review here -- even one sentence helps! Consider including your Twitter handle so we can thank you personally!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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Hi, this is Ben Horowitz, and you're listening to The Jordan Harbinger Show. Welcome to the show. I'm Jordan Harbinger. As always, I'm here with producer Jason DeFilippo. On the Jordan Harbinger Show, we decode the stories, secrets and skills of the world's most brilliant and interesting people and turn their wisdom into practical advice that you can use to impact your own life and those around you. I want you to see the Matrix when it comes to how these amazing people think and behave so that you can become a better thinker. And today, a great thinker in his own right, founding partner of superstar venture. capital firm Andresen Horowitz. We've got Ben Horowitz here with us today, recorded on location here at the offices of A16Z in Palo Alto, California. Ben has written a few excellent books, and this latest one takes on historical events and turns them into business lessons,

especially with respect to culture, corporate culture. I know that that might sound a little bit like corporate speak here, but today we're going to explore what the Haitian slave revolt can teach us about running a business. We'll also learn how prison culture, as discussed by a couple of Silicon Valley Geeks, which is us, by the way, influences how some billion-dollar tech unicorns are managed. And we'll discover that culture and core values can actually have a dark side. And we'll see how that dark side shows up in companies like Uber, for example, and can lead to some pretty big disasters. It's always fun to sit down with someone like Ben who's objectively being very successful and take a peek behind the kimono of what makes someone like him and the companies he invests in

and helps manage, tick. And if you want to know how I managed to book guests like Ben Horowitz, I've got a crazy network and I want to teach you how to do the same. I'm teaching you how to do this in my free networking course, not enter your credit card free, just free free. It's at Jordan Harbinger.com slash course. And most of the guests on the show, they subscribe to the course and the newsletter. So come join us and you'll be in great company. All right, here's Ben Horowitz. I did notice that reading both books, you've got some street in you. You know, you quote a little rap here and there, hip hop here and there. Sure. And I wonder, do you listen to that or was that something like, oh, no, no, no, you have to listen to that. Yeah.

to know the exact right rap quote for the story that you're telling. But a lot of it actually is the kind of backwards of that. So I listen to so much rap music. A lot of the ideas I get for what I'm going to write come from the actual music itself. So it's a little bit of a way of kind of giving credit where credit is due just so. You know, it doesn't feel like I'm stealing it. Right, right. It's expensive, though, like licensing those lyrics for a book.

It's not cheap. Oh, I didn't think about that. Right. You've got to call Jay-Z's people and be like, can I use this in a book about corporate culture? Yes, exactly. And not only is it expensive, but the process is like really complex. Yeah.

Talk about something that's right for disruption. Yeah. You try to use a sample of music on a podcast. I mean, it's cheaper to hire someone to just remake. Yeah, right, exactly. The song's got like 18 authors, and then, you know, the lawyers go after you, and then they charge you too much. Like, the whole thing is just crazy.

Yeah, it's unreal. What are you listening to? Like, what's on your iPod or your phone that might surprise us? Well, so the thing that album that I'm listening to constantly now is the Young Thug album. I love that album. It's called So Much Fun. He really did an amazing job with it. So that's probably the number one thing I'm like. Of course, listening to New Jeezzy album, the new Rick Ross album, because I like those guys. But the albums are, if you're big fans, are really good, but they're not. The Young Thug album is like a truly like special album, I think. It's not entry level. Is that kind of what you mean? I think he's a little bit underrated as an artist. You know, he's just, he put it all together.

You know, he's done a lot of good things in the past, but he put it all together on those funds. It's really special. The reason I'm starting with this seemingly flimsy question is there's some juxtaposition here that I think a lot of people don't really appreciate. It's really easy to look at somebody in the tech sector or an investment sector and just be like, these are some pretty square guys that only look at spreadsheets and are only looking at numbers all day. And that's not really what you do at all. Yeah, no, like I think I'd come from a different perspective. in that, well, one, it came up as an entrepreneur, not as a finance guy.

So I'm looking at it in that way. So it's more of a, you know, I'm looking at things more from a culture and a leadership perspective just throughout life. But, you know, hip-hop from a cultural perspective. I talked about this in the book, a bunch, is a really great example of just the power of culture because you had this, you know, it started with parties in the Bronx and kind of, you know, a very, very, very underground kind of thing. and nobody in the music establishment thought it was a good idea.

So MTV won't play the videos, the radios won't play the songs, the record companies won't make albums like. So there's literally no infrastructure support at all. So then the kids were all like, they were all poor, they're all black, and so they're coming up and you go like, well, how are they going to succeed against the system? And then you fast forward to 2019, you go, oh, wow, this is the biggest musical art form worldwide by far.

it's just wiped out all other music. It's like that significant. So how did that happen? And when you go back and look at it, like a lot of it was the culture they had, you know, and there were a lot of elements in it. But, you know, the just idea that you were going to create something from nothing, the idea that like you were going to get no help and you were going to figure it out. And one of my favorite stories is Ralph McDaniels, who was, you know, like an early guy in hip-hop.

And nobody would play the video. So he, like, literally started a television station. to play rap videos, a television show called Video Music Box, and that kind of started the whole thing. And then he became uniquely famous because he invented the term shoutout. Oh, that's really good. Which everybody uses now, but like it was, you know,

they were going to invent whatever they needed to get to the next phase. And that was like it was a cultural, like, attitude and belief as much as it was anything else. There was no reason that it would have gotten so big. So you really are kind of like listening me of this music kind of thugging in your car on the way to work and then it's uh and particularly kind of the era that i'm from in rap music is more is very entrepreneurial music because they were all

entrepreneurs because they had to be there was no like you couldn't go like oh i got signed there was something signed and rap you know and so what they rap about a lot is like how do you make it how do you think about how do you all the things that an entrepreneur thinks about so it kind of is uh very i'd say it's inspirational for the kind of work that I do. The new book uses history like the Haiti slave revolt and takes corporate culture ideas and notes out of history, which is a really interesting way to look at corporate culture. I don't think has anyone ever connected these kinds of things before? I've never seen it.

Not that I'm aware of. I will say this, like people may like or not like the book, but you have not read a business book like this. Yeah. That's for sure. Yeah. Yeah, I read a lot of business books for the show, and a lot of people will take, like, Ryan Halliday will take Stoicism and put it into a business context or a modern context.

But very few people are looking for like, in fact, I don't even think I've ever even read about the Haitian slave revolt ever. Yeah. Really interesting story. Yeah. Yeah. Where did you find these? Were you just researching random historical bits and you went, ah, there's an idea here?

Or did you get the ideas from culture and look at the world? No, no. So this is like, I would say this is more life's work. So, you know, I got introduced to the various things at different points of my life. but these were the things that influenced me most personally as a leader. Basically, the four stories that are in the book are the things that, you know, as I tried to learn how to create a culture, change, and so forth, they were the most influential kind of leaders and thinkers for me.

And the Haitian Revolution is just this unbelievably remarkable story, which unfortunately not a lot of people know about, where there had never been a successful slave revolt, like ever in the history of humanity. Like, not just, you know, for like the transatlantic slave trade or whatever, like, you know, not the slaves of the Han Dynasty, not the Gauls that the Romans enslaved, like, not ever, not nobody ever, like revolted in one until this slave army led by Tucson Lover-Chur. And they were up against, like, crazy bad odds because slavery in, you know, a lot of people who follow slavery, know that this was probably the worst.

form of slavery, you know, in the history of humankind and that it was sugar plantations. It was extremely brutal, like more people died than were born, like all that kind of thing. And then the leader himself, Toussaint was born a slave. So he kind of, you know, came up in that. But he was one, a genius, but more specifically a cultural genius. And he mastered French colonial culture. And then he mastered kind of military culture, including, you know, from reading Caesar's commentary. So he picked up like, when he studied it, he learned all of Julius Caesar's like military techniques. But I think most importantly, because he was so kind of multicultural in his education, he knew kind of where the limitations of the slave culture he had were. And it's very hard to make

slave culture into military culture because slave culture, almost by design, is low trust. And the problem with a low trust culture, and right, trust is about tomorrow. I'm going to do something for you today because I trust that you will do it for me, you know, down the line. Well, when you're a slave, there is no tomorrow. You don't own anything. You know, your family can be taken away from you at any minute. You can be killed on like a whim. So there's no like long-term thinking in the culture.

And so taking that and then trying to build an army out is very difficult because armies run on trust. Like if I don't trust the command, then it's just chaos, right? Like it's the Byzantine generals problem. It's a very, very terrible way to try and take on like Napoleon, which is what he did. Yeah. So, you know, he went through this, like, amazing set of steps and techniques to kind of change the culture. And the amazing thing, of course, was the army that he ended up with not only defeated the British, the Spanish, and the French under Napoleon, but the reports of what they were the most disciplined

army. They were the one army that didn't rape and pillage. In fact, one of my favorite stories in the book is, you know, because he was changing the culture, he said, look, you can't rape, you can't pillage on the way because we're fighting for liberty. And like you can't take away liberty and fight for liberty. Like they don't go together. You've got, we have to be focused on liberty. And that adjustment got him support of the white women in the colony. So they supported him over the white armies. And they actually called him father. That's how much they'd love the guy. And one of the of my kind of one of the greatest stories, which we don't know if it's apocryphal or not, so I couldn't put it in the book. But it's a great story is his name is Toussaint Lovature, but slaves did not have last name. So he was born Toussaint. And then Toussaint of the breed of plantation. But as a story goes, and Napoleon was obsessed with Tucson. He suffered more casualties in Haiti than in Waterloo. So like if you can imagine that. He basically sold us 13 states for $15 million, because

because he was so depleted by this war in Haiti. And he was obsessed with him, and he was screaming on his generals one day, and he said, like, how in the hell can you not catch this slave? Like, how can you not defeat a slave? And they said, well, you know, we get them backed up, we get them surrounded. And just when we think we have them, there's an opening.

Toussaint, Lovichere, Toussaint, the opening. And so that's the story of the name. That's interesting. Yeah, impossible, unfortunately. And I always think, you know, why was there always an opening? Because the people on the ground, all the people on the ground were rooting for him. How often do you look to history when you're evaluating which companies to invest in or helping CEOs to manage and things like that? You know, I think your life kind of comes from all of your experiences. And I think that, you know, particularly when it comes to culture, I think to Sam, for me is the big guidepost. But also there's a great thing in the Boshito, the way of the Sam.

which is keep death in mind at all times. And you go, like, that's the underpinning of the whole samurai culture is keep death in mind at all times. It's sort of the first rule. And you go, okay, well, that is a really weird rule because that doesn't sound like a very happy culture at all. Like you think of anything more miserable than thinking about dying all day. But what they mean by it is profound and that it's, look, if you're going to do something,

do it like this is going to be the last time you do it. Like, if this was the last thing anybody saw you did, how do you want to be remembered? What should it be like? How do you think about that? And that, I think, like, is the most fundamental thing when you're talking about designing a culture, because you really want to say to your people, look, people 30 years from now aren't going to remember if we made the quarter. They're not going to remember, like, you know, if this product had a bug.

They're not going to remember any of these things we're so focused on. They're going to remember whom we're going to remember. What was it like to work here? You know, what was this time like of my life? What was it like for the people who touched us and did business with us? What was it like for them? And that's all comes from your culture and how you conduct yourself on a daily basis. And so this whole idea of keep death in mind at all times.

And you can feel it even in Japan today. You know, you go there and people take tremendous pride in the very, very little things. They're doing it like it's their last time. And that all comes from this idea from like 900 AD in the ancient samurai. So a lot of the concepts, you know, particularly when you think about organizations and leadership, they've been done before. Like, there's not a lot of invention here. But understanding what, like, really worked over time, what lasted, what could actually move behavior is important.

There's a thought exercise here. So, like the samurai who starts their days imagining what it would be like to die, you recommended in the book, or at least that's what I read, you're recommending doing the same thing with your company. You're going bankrupt. Let's say you're going bankrupt or that you thought exercise. that you're going bankrupt. Was this a good place to work? Did people enjoy doing business with us? Were our partners happy? Did they think highly of us? Right. It's our product of high quality. There's something useful there because I think a lot of people go, screw it. We've got to just cut every corner and get this thing done. Or, you know, we're going to burn these guys on this one,

but we really need the money to do this other thing. And there is some short-term thinking in corporate governance. Oh, yeah. No, there's a tremendous short-term thinking. And there's kind of, you know, like what are people going to think of me? You know, as opposed to am I doing the right thing? And that's where it gets really screwed up, which is one of the reasons that this is actually why the Genghis Khan chapter, which is called Genghis Khan Master of Inclusion. But I think that, you know,

the thing that is bothering me a lot about the way people approach it today is, it's like, well, what is the New York Times going to write about, like, my numbers? Or what is, are people going to call me names like racist and sexist? And that's the basis for like how I approach the whole concept of inclusion, which is completely ridiculous in that you're going to guarantee to grow up your culture if you do it that way. Like if you start from that position of perception or short-term gain or whatever as opposed to, what is this place going to be like to work if I'm coming from a different background than the people here already, which is the real question. And then can we see that talent and can we bring it in or are we just blind to it? Yeah, you've mentioned that building a great culture means teaching the people or the culture to adapt to outside circumstances. The example you give, I think, is startups who want to sell to enterprise, but then nobody wants to wear a suit.

Nobody wants to dress nicely. And so you need to bring in culture or executives from the outside who know the culture that you want to infiltrate, I guess, is the word for this? Yeah, yeah, yeah, yeah. So how did those principles come from like a slave revolt, for example? Yes, well, that's a super great question. And so maybe unique, certainly unique among slave revolts in the kind of transatlantic slave trade era, was that Toussaint had, if you looked at his army, he had lieutenants from the French army, the Spanish army.

So he would defeat his foes, and he would not kill them. He'd incorporate them into his own army. And actually, in Haiti at the time, like, blacks and mulattoes didn't get along. Yeah. And so he would have blacks and mulattoes together and so forth. forth. And the idea was, he was like, look, if we're going to beat these guys, we got to understand them. You know, we have to understand their way of thinking. We have to adopt what they're great at and incorporated into our stuff. And I think that if you're going to sell

to Federal Express or the Home Depot or J.P. Morgan Chase, you know, like people in Atlanta and people in Memphis aren't the same as people in Silicon Valley. You have to understand those cultures if you're going to do business with them. And you're not trying to like kill them, like the way You're trying to help them. But you can't help them if you can't communicate if you don't understand where they're coming from. And so the willingness to kind of adopt enough of their cultures so that you understand it and can solve their problem. It's something, yeah, a lot of entrepreneurs are unwilling to do. And I think you see a lot of failure on that basis.

You're listening to The Jordan Harbinger show with our guest, Ben Horowitz. We'll be right back. Thanks for listening and supporting the show. And to learn more and get links to all the great discounts you just heard from our amazing sponsors, visit jordanharbinger.com slash deals. Don't forget, we have a worksheet for today's episode so you can make sure you solidify your understanding of the key takeaways from Ben Horowitz. That link is in the show notes at Jordanharbinger.com slash podcast. If you'd like some tips on how to subscribe to the show, just go to

Jordan Harbinger.com slash subscribe. Subscribing to the show is absolutely free. It just means that you get all the latest episodes downloaded automatically to your podcast player so you don't miss a single thing. And now back to our show with Ben, Horowitz. There's a great principle that can relate to any size business, which was cultures always reflect the values of the leaders. So you have to be the example of the culture in your own business. Basically, you have to walk the walk. And that seems really obvious. But then when you read examples of people that haven't done that, you're just thinking, oh, wait, I've seen this everywhere. All the time. All the time. And nobody walks to walk 100%. Like everybody has slip-ups. But, yeah,

It's amazing how often people kind of deviate. Yeah. Yeah. It's like if you're, let's say you have a culture of punctuality is a really simplistic one probably, but you have to be punctual yourself. Right. Not always going to be there every time. I mean, of course, there's, you know, sometimes you hit traffic on the way to the airport, right?

But you have to build these values over time. You can't really, in many cases, just decide what they're going to be yourself and then try to get them. It seems like they happen based on the values of the leadership. Yeah. So this is a really important point, I think. Because a lot of, like if you bring in the whatever, the culture consultants, and they go, well, like, let's have an offsite. We all get together and we'll brainstorm all the things we want to be.

And then we'll have this long list of values. And then we won't adhere to them. And then one cultural thing will be hypocrisy. Because everybody will look at the values and go, we don't do that. And a lot of the problem is, if you build a culture by consensus, then the leader themselves may not even be willing to follow it. Right. And so it's really a weird way to go about it. The correct way kind of is a combination of, okay, who is the leader and then what is

the strategy of the organization? And does the culture support that strategy? And so just, you know, as an example of that, you take Amazon and they've got like cultural frugality is like a big thing in that culture. And the reason it is is because they want to be the low-cost leader. They want to be able to underprice everybody on everything. and that's been kind of a big strategy for a long time. So they don't want to waste a lot of money in the company.

Now, they did a lot of things to put, you know, they used to have these desks that were actually doors that they just nailed some two-by-fours on, right? So it's like, running and spend money on your desk. That's how cheap we are. You would never see Apple do that because they're high design. Right.

And, you know, their campuses cost like $5 billion or something and has, you know, super fancy doorknobs and all this weird stuff or beautiful stuff, depending on your perspective. and that's right for them. And if you look at it, like Apple's products will never be as cheap as Amazon's, and Amazon's products will never be as beautiful as apples. They have different strategies and different cultures that support those strategies.

So the idea that, like, you just get together and have, like, some weird consensus brainstorming, come up with the culture is just bizarre. But that is, like I would say, probably more than half of companies go about it that way. Yeah. If you hear about that all the time. Yeah. I haven't worked in corporate for a really long time, but even back. back in my old law firm, it was like, all right, we're going to have pizza in the conference room,

and then we're going to talk about ethics and things like that. And it's like, well, okay, didn't you just leave early with your mistress yesterday? Like, what are you talking about ethics? Come on. That's a funny one, yeah. I mean, you're not a funny one. It's a sad one. Yeah. There's a lot of ethics itself, I think, has to be defined.

That's another, you know, I talk about in the book, you know, Uber has this value, do the right thing, period. Yeah. And it's like, well, what the hell does that mean? Right. Yeah. Like, what is the right thing? And I think that this is where Toussaint was so great because he got into so much detail on like what the right thing was and what ethics meant.

And I think that if you're going to have an ethical stance, you have to be extremely explicit about every aspect of what that is. It was either him or another example from the book where he said, look, if you're married, you can't have a business. Because if we can't trust you to keep your word to your wife that you did before a pastor or a priest before God or whatever, then how? my husband, how's the guy standing next to you? You're going to trust what you tell him. And that was so key because one of the things he had to remember from our earlier conversation that he had to overcome was like the slow trust. So how do you reestablish that? Well, you go like, I'm not going to let you cheat on your wives. Okay, now in a military context, that's very unusual. I mean, even today, right? Like we have the whole thing. I'm name names,

but, you know, they are, you know, all in. But, you know, going from that to, okay, I'm going to hold you to this rigid standard. I'm going to kick you out. You can't be an officer in the army. Why do that? And it's exactly, as you said, it's like, trust is Parenthood. Like, that's the thing. And Tucson famously said, you know, I'd rather relinquish my command than break my word. Everything was, like trust was the foundation of how he got out of the weakness of slave culture and into the super strong military culture that he built. Are leaders like this very explicit in the why? Like, did he say, you can't cheat on your wife and here's why? Or did he you just say you can't cheat on your wife and then he knew why, but nobody else did? Yeah, no, no, I think that the why is fundamental.

And in almost any kind of cultural value, and I just give you a quick example that we have one here. So one of the really important things for us when we started the venture capital firm was we have to respect the entrepreneurial process and what it means and respect the entrepreneur and how difficult that task is to build a company. But like everybody in venture capital says that. But like nobody acts that way. They're like, oh, yeah, I'm a half hour late to the meeting. I'm obviously more important than you.

I don't respect you. Oh, I'm not going to do your deal. I'm not going to tell you. I'm just going to ghost you. Like, you know, F off, I don't respect it. And so like the whole industry, kind of the protocol is very disrespectful to entrepreneurs, yet they all say that they're very respect. So it's like this weird thing.

And so I was really committed when we started to not doing that because it used to drive me crazy as an entrepreneur. And so one of the things we put in place here was, if you're late to a meeting with an entrepreneur, the fine is $10 a minute. You got to go to the bathroom. You're five minutes late, no problem, $50. And you're paying it right on the spot and you're going to be embarrassed in front of everybody like, it's like that. Oh, wow. And so you go, well, why would you do that, Ben? You're such an asshole. And, you know, it may be true. But the key was the why. because the rule was so, like, shocking, people would ask, well, why I was doing, like, an important phone call. I had to go to the bathroom. Why do we, are you charging me so much damn money

to, like, go to work? You know, like, I'm working. Like, I'm not at home. And the reason is because we're not going to waste a second of entrepreneur time ever. Like, we're not going to do that because that's why we're here. We have a respect for how hard it is to do what they're doing. And we're not going to waste their time. And I want to tell that story. I want people to ask me why so that I can tell that story over and over and over again because it's so important. And that's what builds the culture is the why. That the why is what builds the culture versus just the rule, I think, is what a lot of people are missing when they do these off-sights or whatever. Right. Because they go, oh, cool, we have this thing and we're going to, the list of 10 core values and we're going to have an

artist like spray it on the break room wall. And then it's just literally decoration. That's it. Yeah, no, exactly right. And one of the things I have in the book is Tom Kauflin, you know, with a similar shocking role, but with a different meaning, right? So, you know, he was like, if you're on time, you're late. And like, he would find people for being on time. And thousands of dollars in his case. And even the New York Times, like, this guy is just like an abusive coach. Yeah. He's like these players, they're calling us and they're complaining because he's abusing them. And, of course, he won two Super Bowls. But, you know, you got into the why of it. Like, we really, really care about the details of everything we do. So much so that like if you're on time,

you're like, if you're not doing your job exactly right, then it's wrong. And, you know, that whole thing made them just a very, very highly precise operation, which in football turns out to be really important. Yeah. You know, he created that culture that took them from like a really horrible team to Super Bowl team. You mentioned Uber before. And in that book, you actually say Uber is true to its core values. And it's kind of like, well, whoa, what do you mean. They got in trouble for allegedly stealing Waybo documents. I don't know if we're still using the allegedly word. Well, I think Lewandowski actually got convicted for me. Yeah, so they stole the Waymo documents. So I'll cross allegedly off my list. Hacking rivals in China. They were

sort of like scamming riots in China and the U.S. I think. Tricking competition. And there's the Susan Fowler incident, which I believe is like a sexual harassment thing. And you said, hey, that's all culturally consistent. What do you mean by that? Well, look, and I want to make sure I'm not misunderstood on this one. So Travis Kalanick was a great CEO in almost every way, like one of the best CEOs we've seen in Silicon Valley in many years. And beyond that, like he was really good at culture, like really good, not like a little good, really good. And if you read the Uber cultural values, they're super unique, they're very motivating, and they really adhered to it. But he had a bug in his like if culture is a code, he had a bug. And that bug was really significant in that. He had,

giant emphasis on, I would say, competitiveness, ownership mentality, these kinds of things. And so what that meant was like, we're all about winning. And he had this thing. He used to say, hashtag winning. We're going to win. And that's the most important thing. And then I'm going to give managers a tremendous amount of autonomy on how to do that. But he never said, and this is the thing that, you know, was one of the keys to Sant was he never made the ethics. or the limits explicit. That was just left on set. And so the way people ended up interpreting it was, well, we can do whatever as long as we win. And if you look at every single incident that they had, almost every single one was driven by some competitive intention. This is how we're going to

win. And like, for example, the hacking, the competitors app actually was done to them first by D.D.D. in China. Right. I remember that. Right. Like where that was okay. But because there was no like explicit instruction about whether that was okay or not. They just brought it back and did it here. And, you know, if you go through one by one from, you know, Susan Fowler to Levindowski to whatever, it was always about winning. And with Levindowski, remember, Google was kind of attacking Uber going to, they were a partner of Uber's, but then they were going to launch, you know, Uber got word, they're going to launch a ride cheering thing. And so it was a competition and it was about winning. but if you don't have the line and everybody's using their own judgment on that, that's where

things got kind of wacky on them. I'll bet Travis learned from that and I'll bet that he'll be very successful in the future because he's a tremendously gifted, not only CEO, but he's tremendously gifted on culture. But it's very difficult. You know, like that little thing caused the whole thing to nearly unravel. Right. So it's almost like the AI example where if you have the best paperclip making AI, then it's like if you just follow. the rule to an extreme conclusion, now it's dismantling humans to make more paper clips or whatever. It's culture as a code that has unintended consequences potentially. Yeah, and it often does. I mean, I think culture often has unintended consequences,

and you don't want them to be fatal. I mean, that's a key. Yeah. And so you have to be really, really thoughtful about how you do them, and then you have to pay attention to it and you have to change it when it's broken. A few of the culture rules come from really unexpected places. Well, the slave revolt was unexpected for sure, but Shaka Sanger, who is this, like prison gang leader, I guess, for lack of a better. Yeah, no, I think he was really somebody. Although, you know, Shagas says, we don't call them gangs in prison. Oh, okay.

I call them squads, religious organizations. So he's a prison squad religious organizations. So he ran a squad called the Melanics. Yeah. So how did you grow across this? Yeah, so like the weirdest story. So I was actually interviewing Oprah Winfrey for like she was having an event out here and I was going to interview her for her the launch.

of a show she had called Belief. But, like, I'm interviewing Oprah. That's a scary task. Yeah. You know, that's like giving Albert Einstein a pop quiz. So I was like, okay, in physics. And so I said, Oprah, like, can you give me a little lesson in interviewing before, like, I interviewed you? If you go there and you're like, tell me five tips on interviewing.

What was the? Yeah, so actually, so it's funny. The first tip was she goes, Ben, like, well, the first thing is don't like have a list of questions. and keep thinking of trying to memorize them because then you're not going to ask the most important question, which is a follow-up question. I said, you know, like, I actually know that already. I've done enough interviews. I got that part. However, like, what I really want to know is, like, how do you ask these super aggressive questions? And then rather than people being defensive, they just, like, burst into tears. Right, yeah.

These awesome interviews. And she goes, oh, yeah, that one. And then, you know, she got into this thing that you talked about earlier, which is, you know, I start by asking them, what are their intention. And then I tell them, like, I'm going to get you your intention, but you have to trust me. And I say, okay, so, and she goes, well, let me give you an example. You know, last week on my show, Super Soul Sunday, like, I met this guy, 19 years in prison, seven years in solitary confinement, scary guy, dreadlocks, tattoos, big muscles. She's like, so I'm interviewing him. And I say to him, I say, when did you get into crime?

And he says, well, I hit the streets when I was 14 years old. And she goes, Ben, but I had read his book. And so I didn't think that was right. So I said to him, I said, well, what about that time when your mom, you know, when you came home with straight A's on your report card and your mom reacted by throwing a pot at your head? And Oprah says, well, he said, that didn't make me feel very good. And he kind of tightened up, folded his arms. And she goes, now, how did that really make you feel? And he said, it made me feel like there was nothing that I was ever going to do in life that mattered.

And Oprah says, you hit the streets when you were nine. And we both started crying. She said, and I was like, oh, my God, that's the greatest interview story I've ever heard in my life. So I run home, tell my wife. She's like, oh, that's a great story. And I didn't think anything of it. The next thing I know my wife has friended him on Facebook. Chalka singer?

Yeah, yeah. I'm like, what are you doing? I was like, this guy's 19 years. He's killed people. Like, you know, like, he went to you. to jail for like a murder he did commit like that yeah didn't commit and so like that was kind and then she like next thing you know she invites him over for dinner and so I'm like no no like don't have them at the house like let's have it a restaurant down the street so we can get out of there

in case it gets crazy but you know we have dinner with him the craziest thing about it was I'm always talking to CEOs and I'm always trying to learn things and I'm talking to him and he is like probably the most advanced CEO that I've talked to since Andy Grove pastor way. Like, it's like that. You know, and then we'd listen to the same kind of music and whatnot. So we ended up talking for like seven hours that night. And, you know, we became friends. And then, you know, in learning his story and learning how he had to deal with prison culture and how he had to build the culture of the organization, I just thought, well, like, that is so interesting for the book because the guys he has, like in Silicon Valley, like people come

with some, like, a lot of cultural elements, like things that you would want, you know, things. that they've been trained on things. The guys he got in prison, like ground zero. Yeah. You know, they were in prison because they came from like really psychotic cultures. And so he could use almost nothing that they came with. So how do you build a culture from first principles? I'd say that's probably my favorite chapter in the book for that reason

because it's just you read it and you go, oh my God. Like how do you even function in this environment, let alone create a culture, realize it's screwed up and then change it and advance it. And of course, he does all these things. You're listening to the Jordan Harbinger Show with our guest, Ben Horowitz. We'll be right back after this. Thank you for listening and supporting the show. Your support of our advertisers keeps us on the air.

And to learn more and get links to all the great discounts you just heard so you can check out those amazing sponsors, visit jordanharbinger.com slash deals. And don't forget the worksheet for today's episode. That link is in the show notes at Jordanharbinger.com slash podcast. If you're listening to us in The Overcast Player, please click that little star next to the episode. We really appreciate it. And now for the conclusion of our episode with Ben Horowitz. I thought that this part of the book was worth the price of admission for the book, period. Like if it was just that chapter, yeah, I thought it was incredible.

One of the things from the book from that chapter, you have to constantly examine and reshape your culture. Otherwise, it won't be your culture at all. That can't be any more true than in prison. Yes, absolutely. Well, right, and his first day in prison kind of shows that in that, you know, He comes out of quarantine. And, like, quarantine, there's whatever, six guys with him. They come out, and their first day, like, in the wreck call, one prisoner walks up to another

one with a shank, stabs him in the neck, prisoner bleeds to death. Guy throws a shank in the garbage, goes to the chow hall and, like, has a sandwich. Oh, God. And I was like, well, like, what did you think when he said that? Well, he said, the first thing I thought is, like, can I do that? Because, like, that's what you need to do to succeed here. can I do that? And I was like, well, you had killed a guy. So, like, of course you could do that. He's like, no, no, no, no, no, no, no. He's like, what I did was, I'm in a drug deal. The guy jumps out of the car when he's not supposed to, like, and comes at me. I've got a gun in my pocket. I react and, like, I shoot him. Like, it was just a reaction. This guy took a two-liter bottle, filed it into a weapon, decides whether he's going to stab the guy in the stomach or stab him or wound him or kill him. decides he's going to kill him, walks up to him, kills him, then throws the thing in the trash,

keeps it moving to the chow hall and has a sandwich. He's like, I couldn't do that. So I had to ask myself that question. And I was like, wow, that is like a very intense form of, you know, new employee cultural orientation, right? And of course, that's going on in every company. Like, you go into a company and you watch how the people are succeeding behave. And whatever they're doing, that's what you're going to do. Like, that becomes a culture. So, like, if you don't keep an eye on that, if you're not adjusting it, like, you get to the this super violent prison culture that we have in the United States. Yeah.

And if you walk into a company and someone gets stabbed in the neck with a shiv, get another job. Yeah, yeah, yeah. Or you better, like, get your courage up, yeah, exactly. That's right, yeah. Yeah, these guys, the Melanics, this squad that he was controlling, no drinking, work out every day. Everyone had to fight for all the other guys. There were a few other rules, but those are the main ones, right? Yeah, and he did a lot, you know, a lot of work.

I mean, he trained him. He, you know, would study philosophy and, like, train them on, and, like, train them on in philosophy. And a lot of that was to bond. Like, they had a unique common knowledge that defined them. And it was a, like, super powerful force in creating a culture. A lot of business leaders do that where they say have their management team, like, I'll read the same book and so forth. But it was that kind of thing. But he didn't just say, read this book. He was like, okay, then we're going to have a training session on it. And so a lot of his guys couldn't read. Oh, yeah. Think about that. So someone had to read to them and explain to them.

Yeah, no, right. Exactly. It was. Wow. Well, nothing like two white geeks talking about prison culture out here in Silicon Valley, right? No doubt. Yeah. I figured. Everything is being disrupted right now, like disruptions of buzzwords. It's not even exciting anymore for a lot of us. What are some areas that you think that are maybe top of mind that you think are ripe for this? Like, where is there some blue ocean? There's no forerunner that's yet emerged. And well, I think that, you know, the big categories of the economy that are right for disruption are financial services, which I think is the one that's happening at the fastest rate. And this goes, you know, everything from all kinds of banking services, foreign currency exchange, real estate services. Anything in those categories is both pretty old and then technology hasn't been applied in a serious way. I mean, like even it's funny. my Gmail account is far more secure than my bank account. That's sad. It's scary. It's bananas.

That is the state of those industries. A lot of it is regulatory capture, and they've got, you know, they've been able to be slow and lazy on technology because there aren't no new banks. And so that kind of self, you have to be too big to fail. That was a big result from Dodd-Frank. So that's a big area. Another is health care and medicine, everything from diagnostics to drugs to, to just health care in general, how it gets built, how it gets allocated as massively, like,

just insanely inefficient and weird. And we're just now really being able to apply computer science techniques to biology because we now have an informational model of biology, not just a chemical model, but an informational model. And so you can start applying AI and these things to drug discovery and medical diagnosis. And it's been, like, amazing the results that people are starting to get. So I think health care and medicine is probably number two. And one of the most frustratingly tough nuts to crack, but I think is coming is education. I mean, we still teach like we're getting people ready for the industrial revolution. And, you know, including the bell, right? Like, that was like the factory. Oh, yeah. I didn't think about that. Got to go to the next class. It's so bananas.

But, you know, like I think change is coming there too. Are there any industries that you think are immune to full software solutions? I mean, like retail. Are we all going to shop online from home, or is there something human about the shopping experience you think will always allow for brick and mortar? Yeah, I mean, I think it's just going to change. I mean, I think that, you know, these gigantic department stores that have pants on like 57 sizes. Oh, yeah. Like, it doesn't make any sense anymore, right? Like, you may have one pair in each size to try on or whatever, a teller, or like they just measure you. And, you know, you have one of each item and you can look at it and they can maybe virtually

show how it looks on you or whatever. You don't even have to get in the pants. And you have to worry about it like somebody before you didn't wear underwear or something like that, which you always see in as like whatever. So I think there will be definitely live shopping and all that kind of thing, just like I think restaurants will persist despite the fact that there will be lots of things like virtual kitchens and all these kinds of things. But they're going to be different.

The last set of retail was built for a completely different environment. So I think that everything going forward is going to assume that you have a supercomputer in your pocket and it's connected to the cloud. And, you know, there's a mass amount of information on everything from like materials to pricing and this and that and the other. But I don't think it's going to go away. I mean, like human interaction is a wonderful thing. And I think most people want it. Like some people don't. Some people don't.

A lot of people in Silicon Valley. could live without a bit. Yeah, there are certainly a few here. You've said that good ideas look like bad ideas at the time. What do you mean by that? And how do we know which is which, if everything looks like a bad idea? Yeah, yes. So, well, I mean, innovative ideas. I mean, the problem with innovative ideas is that they do look like bad ideas at the time. And that's kind of what, right? If an idea is a breakthrough, that means that people can't see it. And so that, by definition, kind of makes it look like maybe it's not a great idea, you know, when it happens. But of course, bad ideas also look like bad ideas. So it's tricky to figure out which is which.

The way we tend to distinguish is, does the entrepreneur have a secret that they've earned? So do they know something about the world that nobody else knows or almost nobody else knows? And then did they discover it through some process of hard work? And that's generally where innovative ideas come from. So, for example, you know, Brian Chesky at Airbnb, like if you heard that idea in the beginning, I'm going to blow up an air mattress sticking to my apartment and rent it out like you'd go. That's obviously a bad idea. Yeah. I mean, what could possibly go wrong with that?

Yeah. People renting an air mattress in your apartment. That's going to be a catastrophe. And originally, weren't they supposed to eat with us, too? It was like we were going to feed them the breakfast part. Yeah, well, the breakfast is a little, you know, a little more loose. But when you go through it, well, why did you come up with that? Yeah. Well, it turns out he and his roommates wanted to go to the design conference. I was in San Francisco. They didn't have the money to buy the tickets, but they knew that so many people were coming in for the conference that there weren't enough hotel rooms. So they said, well, like, why don't we rent out space in our room? And then we can get tickets. And it turned out that, like, 500 people called to rent that air mattress. And so he had a secret about demand for this particular type of service. And then he had a secret. He said,

he furthered that secret by kind of researching hotels. And it turns out hotels have only been around for like 100 years or so. And before that, there were ins in bed and breakfast. Now, the problem that hotels that like Hyatt and Hilton solved was that you didn't know the quality. Like, it could be pretty weird. You go into some small town and there's an end. And you don't know what the hell is in there. But they observed, Joe and Nate and Brian, they observed that with the internet, like you could rate every like room, air mattress, whatever, to a very fine grain of quality more so than even like the Pritzkers could do at the Hyatt. And so those two things combined made like a powerful secret, you know, big enough off of which to build like a really gigantic company. And so that's

that's a lot what we're looking for. I know we have to close in a little bit. So I wanted to ask about your partnership with Mark. You said he upsets me almost every day by finding something wrong with my thinking. Yeah. Partnerships have to be provoking enough to be productive, I think, is the way that you phrase it in the book. So if it's too provoking, you can't get anything done. And if it's too little, there's just no passion or motivated. Yeah, like, if I'm not learning from him and he's not learning from me, then what's the value of the partnership? And like when you're old, anything you learn makes you angry because you kind of thought you should already know it. I think that in a good working relationship, there's a lot of conflict, but you have enough

trust where you can overcome the conflict. And, you know, he and I have been working together now 24 years, so, but it still gets me mad. Like there are days, but I'm just like, I'm gone home. I can't take him anymore. From my last flimsy question, who decides who the names go in a partnership? Like, why isn't it Horowitz-Andresen? So we started, we had an angel fund before Andresen Orwitz, called Horowitz-Andresen. Oh, man. Which has a little bit of ring to it. It was funny. He wanted Horowitz-Andreis, and I wanted Andresen Horowitz once we created the firm. And the reason I wanted at Andreessen Horowitz was when we started, he was like not a little more famous. He's still more famous than me, but he was a lot more famous than I was. And the biggest question we had when we

were raising money is like, are you guys going to actually stick around and do this? Are you going to move on to your next venture? And so I was like, well, we have to put our name on the firm so people will believe that. And like your name is the bigger question. Nobody really cares if I go, as long as it's Andreessen Capital, it'd be fine. So we put his name first. And then the other dividend was the Andresen Horowitz is impossible to spell. So it can't be your URL. So I came up with this idea that like we would just do what we used to do when we were engineers in the 90s about internationalization. We called it I-18N. And so this was A-16-Z. And A-to-Z is just way better than H-to-W-A. H-to-A. It's not backwards. We promise. Yeah. Well, this has been excellent. I do wonder why

you dedicated the book to people coming out of prison. I thought that was really interesting. I do some work with prisons and I'm actually going for my 40th birthday to prison. Well, it comes to kind of the last line in the Shaka chapter, which is, you know, I say like, so who is Shaka Sengor? Is he, you know, like a super thug from, you know, gang leading, like murder from prison? Or is he an upstanding citizen New York Times bestselling author, super creative guy? And the answer is both, right? what you do is who you are. And I think that we've come as a culture to this idea that you can't be redeemed, that if you do anything, if you have a tweet from five years ago, that like you can't ever change and all this, you know, BS. And so I think it starts with people in prison who

absolutely can change. And, you know, what you do is who you are, not like what you did when you were 17 years old to get yourself into prison. And so I really wanted to reach out to people on the inside and let them know that at least, you know, for me, I could see that. And, you know, when we do this book tour, we're definitely going to, we already have a few prisons on the list that we can go visit. Really? And that's really what it's about. It's about like, you know, if you change your culture, you change yourself, you change who you are. And that's as an individual or as an organization. Well, thank you very much. Yeah, it was great. That's fine. Thank you, yeah. This is a lot of fun.

Big thank you to Ben Horowitz for having me out to the offices of Andresen Horowitz, A16Z, for those of, for the cool kids here in the scene. His new book is titled, What You Do Is Who You Are, How to Create Your Business Culture. We'll link to that in the show notes, as we always do. There's a video of this interview on our YouTube channel at Jordan Harbinger.com slash YouTube. And of course, there are worksheets for every episode, including this one, so you can review what you've learned here from Ben Horowitz. That's at Jordan Harbinger.com in the show notes, along with transcripts, which we now have for each episode. Those can be found in the show notes as well. We're teaching you how to connect great people such as Ben, manage relationships using systems and tiny habits. That's at our six-minute

networking course, which is free over at Jordan Harbinger.com slash course. Don't kick the can down the road. You cannot make up for lost time when it comes to relationships and networking. I know you think you're going to do it later. You've got to dig the well before you get thirsty. Once you need relationships, it is too late to make them. Seriously, I found that out the hard way myself. Don't make the same mistake. The drills take a couple minutes a day. I wish I knew this stuff 20 years ago. You can find it all for free at Jordan Harbinger.com slash course. And by the way, most of the guests on the show, they subscribe to the course, the newsletter, so come join us.

You'll be in smart company. Speaking of building relationships, you can always reach out and or follow me on social. I'm at Jordan Harbinger on Twitter and Instagram. And this show is created in association with podcast one. This episode was produced by Jen Harbinger, Jason DeFilippo, edited by Jace Sanderson, Show Notes and Worksheets by Robert Fogarty, music by Evan Viola, and I am your host. Jordan Harbinger. Our advice and opinions and those of our guests are their own. I'm a lawyer, but I'm not your lawyer. So do your own research before you implement anything you hear

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