Number of words: 187 In between personal sales (salespeople obviously required) and traditional advertising (no salespeople required) there is a dead zone. Suppose you create a software service that helps convenience store owners track their inventory and manage ordering. For a product priced around $1,000, there might be no good distribution channel to reach the … Read more

Number of words: 150 When assigning responsibilities to employees in a startup, you could start by treating it as a simple optimization problem to efficiently match talents with tasks. But even if you could somehow get this perfectly right, any given solution would quickly break down. Partly that’s because startups have to move fast, so … Read more

Number of words: 170 Bob Dylan has said that he who is not busy being born is busy dying. If he’s right, being born doesn’t happen at just one moment—you might even continue to do it somehow, poetically at least. The founding moment of a company, however, really does happen just once: only at the … Read more

Number of words: 171 For people to be fully committed, they should be properly compensated. Whenever an entrepreneur asks me to invest in his company, I ask him how much he intends to pay himself. A company does better the less it pays the CEO—that’s one of the single clearest patterns I’ve noticed from investing … Read more

Number of words: 138 As a general rule, everyone you involve with your company should be involved full-time. Sometimes you’ll have to break this rule; it usually makes sense to hire outside lawyers and accountants, for example. However, anyone who doesn’t own stock options or draw a regular salary from your company is fundamentally misaligned. … Read more

Number of words: 344 Venture capitalists aim to identify, fund, and profit from promising early-stage companies. They raise money from institutions and wealthy people, pool it into a fund, and invest in technology companies that they believe will become more valuable. If they turn out to be right, they take a cut of the returns … Read more

Number of words: 317 MONEY MAKES MONEY. “For whoever has will be given more, and they will have an abundance. Whoever does not have, even what they have will be taken from them” (Matthew 25:29). Albert Einstein made the same observation when he stated that compound interest was “the eighth wonder of the world,” “the … Read more

Number of words: 157 The power of planning explains the difficulty of valuing private companies. When a big company makes an offer to acquire a successful startup, it almost always offers too much or too little: founders only sell when they have no more concrete visions for the company, in which case the acquirer probably … Read more

Number of words: 142 What would it mean to prioritize design over chance? Today, “good design” is an aesthetic imperative, and everybody from slackers to yuppies carefully “curates” their outward appearance. It’s true that every great entrepreneur is first and foremost a designer. Anyone who has held an iDevice or a smoothly machined MacBook has … Read more

Number of words: 359 We haven’t yet uncovered the secrets of life, but insurers and statisticians in the 19th century successfully revealed a secret about death that still governs our thinking today: they discovered how to reduce it to a mathematical probability. “Life tables” tell us our chances of dying in any given year, something … Read more