The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers―Straight Talk on the Challenges of Entrepreneurship Hardcover – March 4, 2014

Given the author's love of rap - and willingness to include rap lyrics as chapter intros - my only quibble with "The Hard Thing About Hard Things" was not referencing the most motivational rap song of all time: "Till I Collapse" by Eminem featuring Nate Dogg.As the song begins, with Eminem talking over an army drill cadence: "Cause sometimes you just feel tired, feel weak... and when you feel weak, you feel like you wanna just give up... but you got to search within you, and try to find the inner strength... and just pull that s-- out of you... and get that motivation to not give up, and not be a quitter... no matter how bad you wanna just fall flat on your face, and collapse..."It's the ultimate theme song (if you like rap) for Horowitz' time as CEO of Loudcloud and later Opsware, going through hell - and being forged into steel via incredible trials by fire - along the hard, bloody road to success (seeing Opsware acquired for $1.6 billion). Pulling out the incredibly important lessons from that experience is the purpose of the book.In another section, Horowitz distinguishes between okay CEOs and great CEOs by pointing out a difference in perspective on how they made it through killer trials. When Horowitz would ask fellow CEOs "how did you do it," as in "How did you survive that brutal gauntlet," okay CEOs would point to something specific. Whereas the great CEOs would simply boil it down to a simple hardcore essence: "I never quit."They simply refused to give in or give out, as the "Till I Collapse" chorus puts it:Til the roof comes off, til the lights go outTil my legs give out, can't shut my mouthTil the smoke clears out, am I high perhapsI'm a rip this s--, til my bone collapse...You must know what this means, on a deep level, to be a great CEO. And the same goes for traders. Nearly all traders, like nearly all CEOs, face their "time in the wilderness" - when nothing feels easy, everything feels impossible, and killer challenges press on every side.I devoured "The Hard Thing About Hard Things" in less than 24 hours, having heard about it via youtube interview of Horowitz at a tech startup conference. The sense of realness - of someone who has been down in the mud and the blood and fought their way through - was absolutely compelling.This book - basically a series of guidelines for CEOs and building a business - is not some fluffy management tome written by a theoretical management consultant with no personal concept of what brutally hard decisions are like. This is front-line reporting from a CEO who has gone to war... taken severe casualties... made series after series of life-or-death decisions... motivated troops in the trenches... and ultimately won. (As such, the book will almost certainly offend or turn off those with a more 'civilized', and less emotionally raw, perspective on what company leadership.)The book had triple resonance for me on three fronts: Entrepreneur, CEO, and Trader. The "building a business" aspect spoke directly to our plans: Mercenary Trader, our financial publishing and trading education startup built on founder sweat equity, is on the cusp of critical mass after four-plus years of blood, sweat and tears. Our model is built around cultivating a true community of traders - monetizing the research we use to trade and invest our own funds (and those of clients), while educating members in our community (in a way that no one else does) that they might join us, share trading and investing ideas, and take their own trading to greater than ever heights.In terms of hardcore challenges, we have already had to deal with questions like whether to sell a major piece of the business... how to handle joint venture projects (including a major software initiative) gone south... the bloody business of firing people (of course)... and lots of other things, all while managing capital simultaneously.Ultimately we want to provide seed capital to the breakthrough star traders in our community, having trained them and equipped them with shared community resources - our own version of Julian Robertson's "Tiger Cubs" - and use flowback from publishing profits to further deepen and expand our research capabilities, even while creating a shared idea environment that fosters partnerships and even life-long friendships. Think hedge fund incubator crossed with "trader greatness training" and deep community value-add.Not unlike what a great Silicon Valley firm cultivates for tech founders (and hence the tie-in to this review)... the VC model of A16Z (Horowitz' and Andreessen's firm) was compelling in this regard too, in the way they took a bunch of long-standing VC industry conventions and simply decided to blow them up.(I found it hilarious, as an aside, that the historical reason VCs are extremely private, and totally disdainful of publicity, is because this is how the original banking houses did it, like the Rothschilds and whatnot - those guys were publicity-shy because they so often funded both sides of a war.)For the longest time, as Horowitz makes clear, VCs assumed that tech founders needed "adult supervision." Even worse, they would sometimes try to eyeball a founder to decide if they were "CEO material" based on appearance and superficial impressions, not unlike the worst practices of the redneck talent scouts in "Moneyball" pre-Billy Beane. One almost imagines choosing a candidate to lead an organization simply because he (or she) looks a little better in a tailored suit - which is apparently what actually happens, given an utter lack of substantive process.Horowitz and Andreessen, in contrast, realized that great tech CEOs are MADE, not born - shaped and created via community experience and support - and that all the truly great tech companies were led to greatness by the passionate founders who created them in the first place (Jobs, Gates, Hewlett and Packard etc).They thought tech founders would likely be in synch with a vision of empowering founders, rather than expecting to hand their passionate idea over to an empty suit... and they were right. So they set up A16Z, a different kind of VC firm, to facilitate that transition: "Making" the CEO out of the founder, or rather helping the founder to come into his own as CEO, through guidance and support.This view had deep parallels with a great point of frustration, for yours truly, in respect to the trading industry: There are so many books, so much literature, talking about what makes for a "great trader," or what makes someone "trader material," not unlike someone being "CEO material."But great traders, like great CEOs, are also MADE - it is at least partly an unnatural thing, as Horowitz says - and there is a huge amount of psychological and emotional development along the way. There is training needed for this stuff. And not the same old "cut losses and let profits run" stuff either, but real, deep, meaningful training. Having potential is not the same thing as being developed - not by a long shot.If you are serious about building a business, becoming a CEO, or stepping up your game as a trader via leadership lessons with strong cross-application to trading, buy this book.If brutal honesty turns you off and you prefer a rose-colored-glasses view of reality, however, don't buy this book. It pulls no punches, which is fantastic for those with the clear-eyed courage of Thucydides: "The bravest are surely those who have the clearest vision of what is before them, glory and danger alike, and yet notwithstanding, go out to meet it."

The easy thing about “The Hard Thing About Hard Things,” Andreessen Horowitz co-founder Ben Horowitz’s book about “Building a business when there are no easy answers,” is reading it.That’s because it’s funny, to-the-point, and way more well-informed by real-world experience than most books that give advice ever are.Like the secret to being a successful CEO: “Sadly, there is no secret, but if there is one skill that stands out, it’s the ability to focus and make the best move when there are no good moves.”And, “Managers must lay off their own people. They cannot pass the task to HR or to a more sadistic peer.”And, “The job of a big company executive is very different from the job of a small company executive…big company executives tend to be interrupt-driven. In contrast, when you are a startup, nothing happens unless you make it happen.”But it’s not just catchy phrases and aphorisms that make the book something pretty much anybody who wants to build a company should read, it’s the experience that created them: Horowitz provides in brutal (and, for aspiring entrepreneurs, invaluable) detail the excruciating real-life experiences behind the advice, from his years as a Silicon Valley engineer and then as the CEO of a start-up with more near-death experiences than Keith Richards before its successful sale to HP.Like how to fire people. What to say at the “all-hands” when you just had your first layoffs. What to tell an employee who asks if the company is being sold when it is being sold, but not yet. Why every company needs a “story,” and what makes a great company story (hint: see the letter Jeff Bezos wrote to Amazon shareholders in 1997.) When not to listen to your board. Even, literally, what questions a CEO should ask a prospect being considered for the key, all-important job in any start-up: head of sales.I'm not a fan of “how-to” books, particularly those concerned with managing people, because they tend to be heavy on theory and light on reality, but the chapter emphatically titled “WHY YOU SHOULD TRAIN YOUR PEOPLE" proved the value of the author's experience because it explains the trap in which an engineer I know happens to find himself.He is a software engineer for a start-up that was acquired by a large, fast-growing Silicon Valley company whose name rhymes with “Shalesforce.com.”He is smart, highly motivated, eager to learn, and yet he is miserable at his job for precisely the reason Horowitz spells out as follows in “WHY YOU SHOULD TRAIN YOUR PEOPLE”:“Often founders start companies with visions of elegant, beautiful product architectures that will solve so many of the nasty issues that they were forced to deal with in their previous jobs. Then, as their company becomes successful, they find that their beautiful product architecture has turned into a Frankenstein. How does this happen? As success drives the need to hire new engineers at a rapid rate, companies neglect to train the new engineers properly. As the engineers are assigned tasks, they figure out how to complete them as best they can. Often this means replicating existing facilities in the architecture, which leads to inconsistencies in the user experience, performance problems, and a general mess. And you thought training was expensive.”That line is the exact truth. Just ask the engineer at Shalesforce.com. His managers—if they exist—ought to read this book.In fact, anybody who wants to start a company, or work for a company, or build a company, or invest in a company, ought to read this book, because that’s not the only hard-learned truth in here.Some others include:“In high-tech companies, fraud generally starts in sales due to managers attempting to perfect the ultimate local optimization [i.e. optimize their own incentive pay].”“The Law of Crappy People states: For any title level in a large organization, the talent on that level will eventually converge to the crappiest person with the title.”“The world is full of bankrupt companies with world-class cultures. Culture does not make a company…. Perks are good, but they are not culture.”“Nobody comes out of the womb knowing how to manage a thousand people. Everybody learns at some point.”“The first rule of the CEO psychological meltdown is don’t talk about the psychological meltdown.”And maybe the best of all, because it encapsulates so much of what the book is about: “Tip to aspiring entrepreneurs: If you don’t like choosing between horrible and cataclysmic, don’t become CEO.”This book, on the other hand, is a choice between good and great, so read it.Jeff MatthewsAuthor “Secrets in Plain Sight: Business and Investing Secrets of Warren Buffett”(eBooks on Investing, 2013) $4.99 Kindle Version at Amazon.com