Action Oriented

I never worry about action, but only inaction. – Winston Churchill

It's cheating to start a blog post with a quote from Winston Churchill. He was that good. But sometimes you need to cheat and I'm doing it today.

People ask me all the time about the traits I look for in entrepreneurs and action orientation is at the top of the list. I'd much rather back someone who makes 100 decisions a day and gets 51 of them right than someone who makes one decision a day and gets it right.

I believe that in startups, like venture investing, the cost of making a bad decision is not nearly as great as the benefit of making a good one. So I like action oriented leaders.

When you make a bad decision, you can always realize it was bad and change it. By being action oriented, you put a lot of things in motion and can evaluate what is working and what is not.

I am not advocating a "throw it up on the wall and see what sticks" approach. I believe entrepreneurs need to me more insightful and strategic than that. You need to have a game plan for sure. But within that game plan, I believe it is better to try more things than less things. And I believe that perfect is the enemy of the good.

Dick Costolo, co-founder of FeedBurner and now COO of Twitter, describes a
startup as the process of going down lots of dark alleys only to find
that they are dead ends. Dick describes the art of a successful startup as
figuring out they are dead ends quickly and trying another and another
until you find the one paved with gold.

It's another form of the classic direct marketing technique of test, measure, test, measure, test, measure. You can think and debate about stuff all day long or you can try stuff out and see what works. From my experience, the latter approach is a much better one.

There is a cost to action orientation. You need to be able to hit the quit button. You need to be able to deal with the broken glass that results from doing that. It's a messier way of doing business and some people have a hard time with mess.

A good example of that is hiring. If you are "action oriented" in your hiring, you'll make more hires and more of them will not work out. Which means you'll be firing more people and dealing with the inevitable headache and heartache that results from showing someone the door.

But as I've asserted earlier about startups, the benefits of making a strong hire vastly outweigh the costs of making a bad hire. Strong hires can lift an entire organization almost single handedly, especially when you are a small company. Bad hires can be toxic, but not if you recognize them quickly and move them out.

Great entrepreneurs are hard to work for. They jerk you around, change things up, and are always pulling the rug out from under you. And often a company outgrows that leadership style and needs a calmer more organized leader.

But if you want to create something great and do it faster than the competition, you need to be action oriented. You need to be decisive. And you should not worry too much about making bad decisions as long as you are prepared to recognize them quickly and unwind them.

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Comments (Archived):

  1. bombtune

    Sometimes too much action can bring inanition. But I agree that you have to get out there and fail fast to learn fast.That’s why it frustrates me to talk about ideas. I like to spend my time implementing them and testing my hypothesis. That’s what pragmatists do.

    1. fredwilson

      And with stuff like ruby on rails and mongodb out there, its getting easier and easier to build fast and fail fast

      1. Mark Essel

        We use those.There will be even faster tools coming. The real tool gold will come from letting non-developers implement their own wonderful and whacky ideas.Jeez wasabi is doing it. Awesome!

        1. Dan Reich

          Can’t wait to see more “tool gold” emerge..I remember when I first used a PIC (Programmable Interface Controller) and thought, “man, I don’t have to know anything about hardware to build something.”Now I’m waiting for the software tools that let me say, “man, i don’t have to know anything about software to program something..unique”

          1. Dave Pinsen

            I remember reading about a company that supposedly offered a product like this in Business 2.0, I think, a few years ago. Can’t remember the name of the company though.

        2. Nick Oliva

          I’m sooo not a fan of non-developers “implementing” anything. It’s like self-medicating. I’m tired of seeing Access databases and Excel spreadsheets that consumed multiples of the time it would have taken to do the same work with a rock, paper, and scissors. Non-developers should stick to non-developing, end-use activities where they add the real value.

          1. Mark Essel

            I hear your frustration. But imagine non devs starting slowly like posting to web sites with plugins (wordpress, etc).Did you check out wasabi (linked above). They’re allowing site customization. Add to that interactions of data with views (search) and they’ve enabled non devs to do web development and share their work with others. I think it’s already happening. Expect igoogle to follow suit with shared portals.

          2. Nick Oliva

            Mark, posting to Web sites with plugins and site customization are functionalities that have been architected and developed by developers. The “use” of those is still “end-use”. You’re not a developer when you move widgets around a page any more than you are a furniture manufacturer when you piece together modular furniture.

          3. Mark Essel

            Still you could admit the lines are blurring between web development frameworks (django, rails, lift) and user crafted information portals. Have you experienced wasabi yet? Seriously give it a try (I had to beg for a beta invite). Go through all the options and utilities and you can begin to see the crossover between raw development, and soft user portal crafting.Oh just thought of some more fodder for us to discuss Nick (btw enjoying this).With respect to your statement: “Web sites with plugins and site customization are functionalities that have been architected and developed by developers. The “use” of those is still “end-use” .”What do you think of IDE (tools developed by developers for developers), Compilers (tools developed by developers for developers). Isn’t the realm of developers and tool builders growing, not shrinking?

          4. Nick Oliva

            I don’t disagree that there are tools that are targeted at end users with the intention of reducing their dependence on developers. I just don’t think it’s a good idea for businesses to encourage this… certainly the trend is increasing because people are misguided in thinking it’s a good thing, but every instance I can think of of a non-developer bragging about something he was able to accomplish without tech support or resources was bad for the business. At some point, doesn’t it strike you that what you’re referring to is an indulgence? Almost a hobby?I looked at Wasabi to see what you were referring to, but I don’t have cycles right now to jump into a new thing…. You do see that what they are giving you access to is “configuration” and not “customization”, right? Developers will forever take things that required “development” and create configuration options so that the bulk of needs can be satisfied through these. When that happens nothing fundamental has changed… it’s just the normal life cycle of a product: some work is done by developers so that more work can be delegated later to end-users. The duck… is still a duck.

          5. Mark Essel

            I do agree that there will be layers of development (i.e. I don’t write assembly even though I once learned it). I think as we empower topic experts to do more, we all benefit.

  2. Carl Rahn Griffith

    So true, Fred. Yet, so rare.

    1. fredwilson

      Who? .Men like Winston?

      1. Carl Rahn Griffith

        Ah, yes, to clarify, sorry ….Both, Fred – ie, a lack of Churchillian types of character/leader and a distinct lack of that spirit in so many aspects of life and business.

        1. JLM

          There was a time that you could entrust your children to a series of institutions which taught, developed and uncovered character. Good schools, sports coaches, Boy Scouts, church, the military.In every instance, they encountered men of character who by their very example “taught” lessons which were based on character.Slowly but surely, we have allowed society to beat these particular weapons into plowshares, dumbed down these institutions, become distrusting of the leaders and now we pay the price of this diminished capability.A few years ago I decided not to give a penny to any organization which did not have at its core the teaching of character. It has made my charitable contributions much more focused.

          1. Carl Rahn Griffith

            ‘Character’ – now there’s a wonderful word/expression we don’t hear enough nowadays. For obvious reasons. As you say, a dumbing-down process has almost totally eradicated such people – also to blame is the suffocating culture of political correctness – this is equally damaging, I believe.

  3. Dan Ramsden

    Fred, this should be bookmarked and re-read periodically by almost everyone.

    1. fredwilson

      Including me!

  4. Evan Rudowski

    Good thoughts and I completely agree with the sentiment.The only area where I might differ is regarding hiring. I think the damage that can be done to an organization by hiring too quickly and firing too frequently can be considerable. Turmoil, lost time training, dealing with disciplinary or performance issues, effect on team morale, all can be significant.This is especially true here in Europe where it is much more difficult to get rid of an employee than in the US, but even in the US just because employment is at-will doesn’t mean the effects of hiring and firing are negligible.Not that one should move too slowly or be needlessly fearful of pulling the trigger. Recruitment should be a continuous process, just like sales. But taking sufficient time to hire carefully is worth it.At SubHub we now do skills tests, personality profiling, and detailed reference checks before we hire someone — and that’s after they’ve been interviewed half a dozen times by members of our team. Since we started doing this, we’ve made some great hires who have really strengthened our team and boosted morale. I’ve made enough bad hires in my career to know that going on gut is not good enough.So keep recruiting, keep looking for talent, keep improving the team — but take the time to apply good practices and do it well — that’s the best way to keep building and growing momentum.

    1. fredwilson

      Good counter argument

    2. Rob K

      Bad hiring can dilute the gene pool very quickly. As they say, “A’s hire other A’s, B’s hire C’s.” If you unknowingly hire a B, that can happen fast.

      1. Morgan Warstler

        stealing that.

    3. AndreaF

      You stole my words. Agree that hiring is a bit of an exception to the rest of decisions facing an entrepreneur, especially in Europe. Not sure about skill tests and personality profiling but certainly plenty of meetings with the team and thorough reference checks.I think that more important that one individual hire is the overall team and if you get that right, which takes effort, nothing can stop you and your company.

      1. Evan Rudowski

        Thanks Andrea.Skills tests work for skilled roles — for example, if someone says they’re a PHP whiz, let them prove it. Brainbench is good for this type of thing.Personality profiles can be tricky, but there are some profiling solutions that are quick, not unpleasant for the person being profiled, and reasonably accurate (we like the DISC 2.0 psychometric profile from the Center for Internal Change, http://www.InternalChange.com).With a personality profile there are no right or wrong results (if the person is generally well balanced!) but you can get a sense of whether the person is likely to be a good fit with your company style and the personalities already on your team. Plus once you have done this you have a greater context of understanding the employee’s characteristics when managing them in the future.

        1. AndreaF

          You’re right about testing more technical roles. For the rest I like to rely on guts and team vibe. And occasionaly throw in the mix a bit of disruption.

    4. Dan T

      Evan, it’s great to hear about people using a full range of “tests” beyond just interviews. Reference checking in particular can be very challenging if you are hiring outside your immediate circle. How do you get people to provide the candid feedback that you would expect from trusted colleagues when you don’t have a relationship with the references? There is an interesting solution for this you might want to consider: http://www.skillsurvey.comin use at hundreds of companies from F500 to startups.disclaimer – i am an investor (and a user).

      1. Evan Rudowski

        Dan,Yes, you are right about references, especially when liability concerns force many people to give only neutral ones.(I remember a great Dilbert comic in which the HR director said something like, “I can’t talk about the employee, but I can talk about the weather. The sun is stupid and the clouds are lazy.”)Thanks for the link to SkillSurvey — I’ll check it out!

        1. Dan T

          Thanks for the Dilbert quote – best laugh of the day ๐Ÿ™‚

    5. Aviah Laor

      The trick is to build a system that floats hiring failure ASAP.Technically, if you have some plug-in or APIs, you can expect newly hired employees to contribute something fast. But if the first contribution requires two months diving into the repository, you are stuck.

  5. Mark Essel

    Good stuff Fred. I would add the spin of systematic action. Small changes, iterative, dynamic, and ceaseless help navigate a new business towards the “golden path”.Knee jerk reactions that flip an organization on it’s head had better be spot on. Do one too many of those wrong and you burn the equity of organizational faith in your leadership.Trust is something that makes a sale. Trust is what makes one man work for another in an ideal organization. Radical direction shifts can erode trust. Just because I’m on a driven and ambitious value discovery quest, doesn’t mean everyone I will work with is. A single wrong decision could result in the loss of a persons income in a rough economic climate. But many right choices and Actions can create a new market.Gotta go, it’s time for action!

    1. fredwilson

      Good cautions mark. Points taken

    2. Elie Seidman

      I agree with this counterbalance.

    3. kidmercury

      great points mark. back when i was working for The Man, the CEO of the company i worked for was all about radically changing directions, generally within a couple hours of giving previous directions (or worse, after you had spent weeks completing the assigned project, only to have it cancelled or completely altered just as you were putting on the finishing touches). to his credit his methodology did work for him (his company is an industry leader, he’s worth bazillions) but it got to a point where lots of folks just stopped believing him, and morale suffered a bit as a result.

      1. Mark Essel

        Just goes to show what I know. His style served him well. Once he identified something more valuable he would immediately chuck whatever was in the pipelines. This is a type of dynamic balancing. Immediately updating your systems state to the latest measurements. Your previous boss trusted new data over all else. It worked out for him because he was right about that data. Maybe not so much for his employees. Having an ongoing Vulcan mind meld with your team takes time and effort. You may have perceived the forces that changed his direction sooner than even he did, allowing a smoother transition and less wasted effort. I’d rather have a bazillion dollars and still have you as a team leader/colleague. He didn’t earn that bazillion dollars by himself.

    4. Christian Brucculeri

      This is really well said, Mark.I’ve worked in several startups. A number of these were never short on action, but they made so many massive mistakes; steered the boat wrong, then overcompensated and went too far the other way, etc. It’s exhausting.I can also say without question that hiring the wrong people was the number one error in almost every case. Hiring and firing is massively disruptive and terrible for morale. I’ve seen key hires leave because the company leaders continued to make hiring mistakes. When you lose good people because of your hiring mistakes, you almost never recover.I’m a huge proponent of the iterative process, provided that you can keep momentum up and continue to optimize.

      1. Mark Essel

        Thanks Christian great experential evidence to support my instincts. My ideal business path is going from an agile founder to an experienced and wise business leader. Still working.

        1. Christian Brucculeri

          I think it’s a lifetime process for us all.

  6. Seenator

    Thank You for this Fred. I have forwarded this to our entire team here.We just had a big discussion about this. Essentially, the point is that we have to take risks and make decisions. We fail most of the times but the one good decisions outweighs most of the mediocre bad decisions. Also, one of the other things (practiced in lean startups and other areas) is to reduce the cost of failure so that most decisions are made and we learn quicker.

  7. Guest

    If you wanted to go with a deeper quote, I would have recommended this one:”Even apart from the instability due to speculation, there is the instability due to the characteristic of human nature that a large proportion of our positive activities depend on spontaneous optimism rather than mathematical expectations, whether moral or hedonistic or economic. Most, probably, of our decisions to do something positive, the full consequences of which will be drawn out over many days to come, can only be taken as the result of animal spirits – a spontaneous urge to action rather than inaction, and not as the outcome of a weighted average of quantitative benefits multiplied by quantitative probabilities.”John Maynard KeynesHe was really quite a thinker…(Just to make it clear, the instability he talks about is something similar to what we are witnessing now: a macroecenomic paralysis caused by dampening of the “animal spirits”)

    1. Mark Essel

      Thanks for the quote Krassen, really enjoyed it.

    2. JLM

      The comment that you make and the quotation that you share is brilliant on a number of different levels. First, it is absolutely true in so many ways and is so applicable to what is going on today in the entire world.Elite military units fight out numbered and win primarily because they “know” they are good. How do they learn that?One of the cockiest things I have ever heard uttered was a Sgt Major who was informed — “we appear to be being attacked by about a battalion of enemy troops” (about 300 riflemen, 3 fairly weak companies).The Sgt Mjr was part of two A teams (approximately 20 senior NCOs, men and four junior officers).The Sgt Mjr took a leisurely puff on a cigar and slowly responded — “…sounds about fair to me…”. They repelled the attack handily.While the junior officers were nominally in charge, this Sgt Mjr with a simple artful turn of a phrase set the bar at a level that every man rose to chin up. That was real leadership.Every one of those junior officers learned something about what they could expect from the men they nominally commanded from the guy who really was in charge.

      1. Guest

        right, thanks, and I also think that your example is brilliant, because it underscores something else: the confidence of this man comes from the preparation/training needed to be an A team.Overthinking is bad, but empty hubris is bad too. We can agree now that the best outcome is inspired, confident action by well prepared individuals/teams.

        1. JLM

          Overthinking — very interesting observation. I suspect that is one of the problems with much of the current situation. We have overlooked the basics and are overthinking the “solutions”.I think America is looking for simple, principled, roll up the sleeves leadership and is getting a bunch of overthought, analysis paralysis untried solutions.

  8. jimlindstrom

    This sounds a lot like a restatement of Boyd’s law: Speed of iterations beats quality of iteration. I like it. Ash Maura had a great post on a related topic recently too: http://www.ashmaurya.com/20

    1. Mark Essel

      That’s an awesome post by Ash. I felt compelled to spread it all over the web but forgot here! Ty Jim for correcting that ๐Ÿ™‚

    2. fredwilson

      Thanks for the link

  9. JesperBergmann

    Fred,I am a long-time reader of your blog but this is my first comment. I just want to thank you for always providing such tremendous insight and being so generous with all you knowledge and experience.As somebody who started and failed with one company in college and is working on a second one, your blog is truly a beacon of sound advice and awesomeness.

    1. fredwilson

      That’s the goal. I’m glad to hear I’m achieving it

  10. awaldstein

    Fred thnx for starting this discussion.I’m in agreement mostly except on the hiring front. There is always a risk but hiring is tough and its better in my experience to do the extra due diligence and take the extra time. Fire quickly when its not working but hire with a determination to get the right person the first time. Too much emotions invested in the team to accept someone new, then adjusting when they are gone.When I’ve hired execs I’ve used their team building and hiring record as a mark of their judgement and value. It is a great skill.

    1. kidmercury

      agree 110%. when i was hiring people i generally told them that hired meant an extended trial period and we would fire them quickly if they sucked (i was more tactful than that but that was the basic message). bad employees/teammates are the worst type of cancer, need to be expelled immediately IMHO.

      1. Mark Essel

        I think that quote can get attached to any job postings I place. Be straight with anyone applying upfront about expectations.Whatya think of paid internships that shift into jobs or end without a fuss?

        1. kidmercury

          i love paid internships that turn into jobs — in fact that is what happened to me, i started as an intern and then got the full-time gig. we also had a massive intern program that was basically a full-time recruitment program. but, i think this only works if you have the luxury of hiring college grads, or positions that don’t require a high skill level. for instance when it came time to hire designers, whom we agreed we wanted to invest in getting talented ones, there wasn’t an intern program. instead i had to spend weeks on end looking through portfolios. ๐Ÿ™‚

          1. ShanaC

            On thing- that’s frustrating if you want to learn how to transition into building a portfolio…

      2. awaldstein

        We are in sync. Hire carefully, remove mistakes quickly and move on.Actually, jobs themselves are just extended trials that go till they stop;)

      3. anand

        totally agree. On the employee side, for those starting out, I believe in offering reduced compensation or free work. “Try me out for a few weeks, I will work on job X. If you like my work, we can talk about more projects in the future. If you don’t, no hard feelings.” If the employee does job X from home (corresponding through the internet) with some general direction, the employer saves time and resources in training and can really learn about a candidate’s work.

        1. kidmercury

          yes. i use somethign similar as an entrepreneur trying to solicit customers, i always try to give them something free if i think teh customer is worth it.

    2. Mark Essel

      Solid Arnold. Less time wasted with office drama. We want to disrupt markets, not ourselves.

      1. awaldstein

        Well phrased and so true!

      2. Eric Friedman

        Love this comment – well articulated and precise without finger pointing too to be used to resolve interoffice issuesdramawoes

    3. fredwilson

      Yup. This is a consistent pushback on this morning’s post. And I hear you and others on it. But I’ve also seen a reluctance to hire/fire slow down companies a lot

      1. Elie Seidman

        no risk, no return. It’s impossible to always get hires right.

        1. awaldstein

          No question about this.

      2. Morgan Warstler

        As long as you can create two tiers and withstand the culture inside the operation, this is a great strategy. Because the “keepers” will have made it through, proven themselves, bonded with the founders, etc.The still proving themselves crowd will notice – they aren’t yet in – and around them they will see / feel that the company hasn’t hugged them fully. You’ll hear, “you never gave me a chance, you never accepted me.”It requires a really upfront discussion – and if you haven’t gotten big enough for HR, the founders have to be brutally frank. And it makes using a headhunter all but impossible. In my experience, headhunters become even more attached to their finds during that 90 days before they really get paid, and once they see a guy or two get kicked, they aren’t really friendly about your company.

        1. Greg Matthews

          This is a really interesting concept. It sounds good; I wonder what the downside is? Wonder how likely it would be, in this scenario, for the “not-yet-accepted” folks to clique together and never really integrate? Good food for thought.

      3. Greg Solovyev

        I would say that hiring should be VERY careful and not rushed, but firing should be quick. But I am of course only generalizing my own experience form few successful and not-so-successful startups where I worked.

    4. JLM

      Your comment about doing “…the extra due diligence and take the extra time,,,” is a critical element of success. It really is about the level of effort. Hiring well is a skill which can be developed up to a very high level of competence if you are willing to do the work and practice. It is a damn skill which requires focus and effort and practice.First, read Robert Half on Hiring. Then develop your own comprehensive, detailed list of questions. I have one that is several pages long and which I have used over the years. I use it every time and it seems like when I am in a hiring spurt, I find more things to add to it.Have multiple contacts. You are buying a very, very, very expensive relationship. Have a written job description which is clear, extensive and comprehensive. You will only get 67.5% of whatever you expect. Raise and define those expectations.I get annoyed with folks who do not have written strategic plans, written job descriptions, conduct 5 minute feel good interviews, do no psychological testing, have no performance appraisal system and then wonder why they get “bad” hires.They spend more time and effort picking out organic veggies at Whole Foods.I also use the MB Type Indicator test to ensure I am reading the person right. Don’t hire an introvert for a sales job.There are certain critical hires that you should just take extraordinary pains about — CFOs. I have had great luck w/ CFOs and have hired two in my lifetime (both of whom worked with me until I sold the businesses) who were just world class. I have one right now. A great CFO is the glue which holds the company together. A great CFO is the financial conscience of the company so the CEO can be the leader of the company.While I generally subscribe to hiring the very best people, be careful about certain jobs — CFOs again — and hire someone for whom this is the best possible job. Don’t hire a guy with a Marshal’s Baton in his knapsack.Pay well. Always pay more than the pain of replacement.

      1. Carl Rahn Griffith

        One of the hardest tasks I have ever undertaken, recruitment.People are strange.

      2. awaldstein

        Thnx for this studied response and sharing the learnings of your experience JLM.I”m sure we differ on some items but we agree on the importance of putting in the time and effort to make it work.People are what make companies work. When the J curve happens, it takes teams to win and leaders to build them. I love the process and sweat the details. Its magic when it works and pain when it doesn’t. Take the time to find the right person and move quickly when the person is not right.Leadership is a rare human quality and this pertains to hiring and team building as well.

        1. JLM

          I often wonder whether I am truly inspired to make money or it is just a by product of the satisfaction of seeing a great plan come together to solve a problem. The formation of a great team.I can honestly say that I have never felt as much personal pride as seeing what is accomplished by men with whom I worked when they were young men.Earlier this week I had lunch with a not so young man who had worked for me years ago and I had “forced” him to get an MBA by studying at night. He was anxious to get on with life and he was not patient enough to see how important that would be for his future development. I threatened to fire him if he did not get his MBA. I paid his tuition for every course in which he made an A. I ultimately paid for almost all of his tuition.We had a great laugh about those times and he remarked about the number of times that I made him redo something because it was not quite up to the standards that he was capable of. He has a great job and is now the President of a meaningful enterprise. I was kidding him and telling him I deserved a carried interest in his company.It made me feel great as he described what all of our former colleagues were then doing and how they had been successful. I suspect that is a currency that is more meaningful to me.The funny thing is that I don’t think of myself as being evenly remotely sentimental and yet with the passage of time I find myself valuing these things more and more.It does pay to sweat the details and to be demanding in the performance of things great and small.

          1. awaldstein

            Thnx for sharing.I agree and in the few instances where I’ve been part of the team that built large companies that drove life changing success for groups of people, it’s truly satisfying.

          2. anand

            Wow. He was very lucky to have someone like you as a supervisor and mentor.

    5. aaronaranya

      There is a trick to reducing the risk of hiring the wrong person and our small business has made great use of it. It is simply contract to hire. We let our new people know that they are contractors. If they prove themselves, they will be brought on full time. If they suck the work will just stop coming their way. This has reduced much of the HR and legal nightmare and set a proper stage for new people so when we do have to let people go, it is smooth and easy.Another thing we have started to do is be more up front in our job postings. For example, when looking for a new sales person, we put in”Do you want to work for someone who is driven, has ridiculous expectations and has very little patience? Are you able to work hard when nobody is looking over your shoulder? Will you produce? If you are a whiner, make excuses or annoy me, you aren’t the person for this job. If you donโ€™t produce quickly, you aren’t the person for this job.”This is just an exert but it found us one heck of a great sales guy in just hours and weeded out the 25 others who weren’t up to the challenge. It sounds ridiculous but wow it worked!

      1. awaldstein

        If you have personality, and are not afraid to be yourselves and have your company culture be overt, you are always ahead of the game. Sounds like you have personality, culture and spunk aplenty. That’s always a winning combo and will attract like minded folks. Congrats on that.Contract to hire is a good strategy at times as it removes for the most part litigation issues around protected classes and the slew of bad stuff that can come out of firings. I’ve found that it works for some positions, not others. Two challenges that present themselves in this model are when the position is senior and you need that person to represent you–hard and not always advisable as a contract position. The second is when someone has to leave another one gig, give up insurance and has none of this as a contractor. Folks with families and limited means need to protect themselves.Some smart combo of clever honest positioning of your company, contract for applicable positions and hard recruiting work for those that have to be hires, works with variations for all of us.Thanks for sharing this.

  11. NicolasVDB

    “I believe that in startups, like venture investing, the cost of making a bad decision is not nearly as great as the benefit of making a good one”Bill Gurley at Benchmark made a similar statement about the VC business, he said “in VC false negatives are much more costly than false positives”This would advocate a strategy of making many small investments, not to miss the good ones. Yet to my knowledge only DFJ ever tried this strategy, in the mid to late nineties, and pretty much backed out of it now, moving to larger, later stage investments.Do you agree that the darwinist evolution of the industry is not supporting your point? why would that be?

    1. fredwilson

      VCs have to actively manage their investments. And you also can’t treat companies and entrepreneurs like optionsSo you quickly choke on a spray and pray strategyThat said, you need to make lots of bets in VCIts a tough balancing act

      1. NicolasVDB

        (sorry for the delay in following up)”VCs have to actively manage their investments. And you also can’t treat companies and entrepreneurs like options”This is not obvious.Every VC will say that what matters the most is the team, so if the team is so great, why would they need “active management” from their investor? advice and introduction, sure, but that doesn’t take much time. And if team evaluation is the key strength of a VC, why not treat entrepreneurs as options, and the VC game picking up the right options?In my experience investors only get really involved when things are at least somewhat in trouble (and in my experience they don’t do a good job at it, but that’s a different point).In the “spray and pray” strategy above, one could afford not to support troublesome companies, because the value to recoup is marginal compared to the value of a successful company.Not that I think of it, isn’t it the strategy successfully implemented by YCombinator and its clones?

  12. Greg Matthews

    I don’t think that this principle applies only to start-ups, either. I work for a fortune-100 company, but we still espouse this philosophy on our innovation team. What we’ve found is that building something half-baked makes a lot more sense: As we (and our users) play around with what we’ve built, we often end up finding an application that’s much better than what we’d originally envisioned.Big companies may have a hard time doing this with their core product lines, but there is no reason that they shouldn’t be playing on the fringes too; it’s the only way to allow for disruptive innovation vs. incremental improvement to existing products and models.There are so few companies that really practice this that it is pretty easy to create a competitive advantage – and it’s also a lot more fun.

    1. fredwilson

      So true

  13. anand

    That’s a great quote. You got me here, I’m a fan of famous quotes.I’ve been reading a few books basically saying “You have got to be comfortable being uncomfortable,” “Mental comfort is the death of mental growth.”When we hit the wall (fail), it’s customary to slow down the decision making process, staying in our comfort zone. We focus on perfection to prevent future failure. So I agree when you say perfect is enemy of the good. We can’t slow down, we have to keep moving forward.I’m sure everyone has heard this other quote from Winston Churchill: Success consists of going from failure to failure without loss of enthusiasm.

    1. fredwilson

      I love the churchill quotes. Keep em coming!

      1. anand

        Some more from my collection of Churchill quotes:”If you are going to go through hell, keep going.””A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.””To improve is to change; to be perfect is to change often.””Continuous effort – not strength or intelligence – is the key to unlocking our potential.””Courage is what it takes to stand up and speak; courage is also what it takes to sit down and listen.””Difficulties mastered are opportunities won.””Great and good are seldom the same man.””However beautiful the strategy, you should occasionally look at the results.””Never, never, never give up.””Perhaps it is better to be irresponsible and right, than to be responsible and wrong.””Kites rise highest against the wind – not with it””Success is not final, failure is not fatal: it is the courage to continue that counts.””This is no time for ease and comfort. It is time to dare and endure.””You have enemies? Good. That means you’ve stood up for something, sometime in your life.”

        1. fredwilson

          I like the last one a lot. Hadn’t heard that one beforeMy favorite of these is the going through hell quote. Its awesome

          1. anand

            I like the hell one too since it shows we all go through trials, but if we persevere there is always light at the end of the tunnel.

        2. ShanaC

          Thanks, I needed these too.

      2. kidmercury

        lol, ok boss since you asked for it…..โ€œI hate Indians. They are a beastly people with a beastly religion.โ€ — winston churchillhttp://mwcnews.org/content/…too bad he’s not alive today with a blog, can you imagine how much fun i’d have beefing with him…..lol

        1. anand

          “India is a geographical term. It is no more a united nation than the Equator.” –Winston Churchill [Edit: I like most of his quotes but not this one.]

          1. kidmercury

            i’m not sure what that means. do you know the context of that quote? was it meant to be an insult? asking sincerely. ๐Ÿ™‚

          2. Aviah Laor

            Churchill was a great believer in the British empire: he was a radical opponent to the steps taken to let India become an independent dominion, the first non-white, in favor of the demands for India independence led by Gandhi. In Churchill’s favor you could say that he was also afraid that once British regime leave, the Muslims and Hindus will slaughter one another. But than came Hitler and his focus changed.

          3. JLM

            When undiluted evil was let loose on the world and truly the forces of darkness could have snuffed out the lights of civilization perhaps two men stand apart as having provided the leadership and more importantly, the inspiration, to have risen to save the world —Winston Leonard Spencer-Churchill — son of an American mother, 29 years a soldier, Bn Cdr in WWI, Pres of Bd of Trade, First Lord of the Admiralty, war correspondent, Nobel Laureate (Lit), Minister of Munitions, Sec of State for War, Sec of State for Air, Sec of the Exchequer, Prime Minister (twice) — and a guy who began life with a stuttering speech impediment.He became a powerful speaker. When Hitler had demolished the British Army and the Brits escaped at Dunkirk with no weapons, Churchill spoke with such contempt and vigor that the Germans abandoned their plans to invade England.George C Marshall — professional soldier, Chief of Staff of the Army, Chief of Staff of the Joint and Combined Staffs (incl the Brits), Amb to China, Sec of State, Sec of Def, head of the American Red Cross, Nobel Laureate (Peace) and architect of the Marshall Plan.Churchill called Marshall the “architect of Allied victory” and the single man most responsible for the Allied victory.When Marshall lay unconscious and dying in Walter Reed in 1959, Churchill made a journey to the States (WC was no spring chicken at that time and would be dead 6 years later) and stood crying in the doorway of Gen Marshall’s room in silent tribute to him. It is worth reading to learn what Churchill said at that moment. He praised Marshall as the only man capable of making the Allied alliance fight together.

          4. Aviah Laor

            yup. just the truth, the courage, the determination to win, an amazing capability to turn an almost impossible goal into a winning working plan, and most important: understanding that the only answer to such evil is victory.

          5. JLM

            There are times in life that one thinks they can win or should win or deserve to win; and, there are other times when there is simply no option other than to win. There is no substitute for victory. Absolute complete victory. Untempered, uncompromised victory. Victory which vanquishes its opponents so completely that their very memory recedes from the minds of good men. Victory so complete that the image of their evil becomes unbelievable so completely that men can even imagine that it never really existed.Churchill & Marshall were such men who delivered such a victory. We need more such men today.

          6. kidmercury

            okay i did a bit of searching around out of curiousity and i think the quote was meant to justify the british empire conquering india…..so yes an insult ๐Ÿ™‚

          7. anand

            [Edit] I like most of his quotes, except for that one.

          8. Aviah Laor

            beside the mildly racist attitude, certainly insulting, he was also worried from the Muslim-Hindu conflict, and he probably got that right

          9. anand

            Looking at it again, it looks like it was supposed to be an insult. The way I interpreted it at first was that it was a very diverse country. But you’re right, Churchill didn’t like indians very much at all.

          10. sachmo

            Muslims and Hindus had been living in relative peace for hundreds of years before there was a british india. The modern conflict really only started after Britain decided to partition the Indian subcontinent into a Muslim state and a Hindu one…Also, I don’t think Churchill was particularly ‘worried’ about Hindu-Muslim relations. Though I agree that aside from his view of India, he was overwhelmingly a positive force in history.

        2. Carl Rahn Griffith

          To ‘blog’ doesn’t really do Winnie justice, does it, somehow?

        3. fredwilson

          Well I don’t agree with him on that one

          1. kidmercury

            lol i know

    2. sachmo

      Hey anand,what are the names of those books that espouse being ‘mentally uncomfortable’? It sounds like an interesting concept, might take a look at them…

      1. anand

        I think it was in this videohttp://tonyrobbinstraining….Check it out, it’s really good.Also in Unlimited Power by Tony Robbins and 177 Mental Toughness Secrets, an audiobook that I am listening to now.

  14. Elie Seidman

    As my longtime business partner says “today is a great day to stop doing stupid things”. I’ve found that with all things – hiring, strategy, decisions on tactics – it’s very hard to make perfect decisions but if you make decisions and move forward and try things, you learn from your actions and the next set of decisions are better as a result. You stop doing the stupid things and increase your investment in the things that are working. In the interim, a slow moving – analysis paralyzed – organization has yet to take their first action and is still debating the theoretical (their powerpoints and financial models) instead of learning what the reality is. Iterate, iterate, iterate.

    1. fredwilson

      Your partner’s quote is genius

      1. Elie Seidman

        Yeah – Ariel has a long list of great quotes.

        1. Qrious

          do share!

  15. Dave Pinsen

    “Great entrepreneurs are hard to work for. They jerk you around, change things up, and are always pulling the rug out from under you.”Sounds a little like working for Michael Scott from the The Office.

    1. fredwilson

      That’s not who I had in mind when I wrote it ๐Ÿ™‚

  16. andyswan

    I was going to write a comment to this post, but I couldn’t think through the exact best and most effective thing to say on my first attempt. Therefore, I will do nothing.

    1. kidmercury

      lol

    2. JLM

      Doing nothing? Hmmm, sometimes doing nothing is simply brilliant.If the FDIC/FSLIC/RTC had “done nothing” in the S & L crisis every single real estate asset would have recovered full value, every penny of interest would have been paid and the world would have been a better place.Doing nothing — perhaps the most brilliant possible course of action — sometimes.Perhaps you should form the “Do Nothing Society”? I would join.

      1. andyswan

        You just did!

  17. Nick Oliva

    Happily surprised that you used hiring as an example. I made some hiring decisions when we raised seed money that I wished would have turned out to be dead ends instead of Superfund sites.The one distinction I’d like to make is that I don’t consider those “bad decisions”. You don’t judge a decision based on the outcome, you judge it based on the information that was, or could reasonably have been, available at the time you made the decision. In hiring decisions, you just can’t “know” until some time has passed. All you can do is know that you have considered everything that can be considered in a reasonable amount of time. Great people can be awful in a particular environment, so the problem may be you… or the “fit”. It’s a relationship like any other.

    1. fredwilson

      The deisre for cultural fit is what often slows down hiring. It can be a problem

  18. Satish Mummareddy

    I think the key distinction is that ACTION is different from DECISION. A bunch of actions may lead up to a decision. So the right analogy with respect to hiring is not to hire a lot and fire the ones that dont work out. The right analogy is to not sit and discuss forever what kind of people you want but to interview a lot of people so that you find the right fit. What it means is that instead of sitting and thinking about what decisions to make, try to perform actions that will help you make the right decisions.Not all decisions as equally important. So you need to understand which decisions to make quickly (where the decision itself is the action) and which decisons you need to get more information to make a decison (here generating more useful information is the action). Either way you need to DO stuff.

  19. kidmercury

    i agree with the idea of this post, but i’d like to add the caveat that a framework for decision making is needed. my former business partner and i often disagreed because i would say no to 90% of ideas suggested because they did not fit into a framework for decision making. perhaps it is similar to how you guys have an investing thesis and stuff needs to fit into that to be considered. lots of stuff can fit in, but if it doesn’t, it gets dissed. i think the costs of a wrong decision can be very high if there is no framework, and most of the entrepreneurs i’ve met i feel do not have a solid enough framework (though i probably think this way because i take a more academic approach to things, so it may just be a matter of personal preference)

  20. LIAD

    dogged pursuit of a vision, constant iteration based on feedback and market changes, evolving tactics, revisions in strategy – hallmarks of a determined and driven entrepreneur.problem is though that to the uninitiated this looks akin to flip-flopping and can be taken as a weakness and lack of foresight – when actually it is the exact opposite.it takes an educated investor, journalist, employee to understand that refinements and revisions arise out of a position of stength and not weakness. within the clan we understand this, in the outside world….not so much.

  21. giffc

    On hiring, I don’t believe in taking forever on process but I would stress listening to your gut. If you are at all unsure, it is better to say no than to hire for the sake of growth. Every time I’ve done the latter, I’ve regretted it. I’ll add to the cultural issues others have raised that even in 2 months, a bad sales person or project manager can burn prospects/customers and yank you off track into firefighting mode rather than productive growth… bad programmers can be a monkey wrench in a team… and these types are the people most likely to cause litigation headaches and expenses with frivolous lawsuits after you let them go. This stuff slows you down.

  22. aweissman

    The best action you can make is the right one. The second best is the wrong one. The worst action you can make is to not take action.

    1. fredwilson

      Exactly

    2. LIAD

      if we are getting into these kind of quotes..”The biggest risk is not taking one.” Anonymous”You miss 100% of the shots you don’t take” Wayne Gretzky”Progress always involves risks. You can’t steal second base and keep your foot on first” Frederick B. Wilcox”Take risks: if you win, you will be happy; if you lose, you will be wise”. Anonymous”Only those who dare to fail greatly can ever achieve greatly” RFK

      1. fredwilson

        Great quotes. Love them all

    3. Aviah Laor

      Among the hundred decisions a day, very few are irreversible key decisions that will kill your company or make it a hit.The problem is that your are going to know which only a year from now. And odds are that those were not the decisions you thought are the most important in the first place.

  23. MrColes

    I learned this lesson my first year working at a startup. There have been countless times that we ended up discovering non-intuitive results from a test or seeing something different in a new interface by stopping the discussion/theorizing/arguments and just building it.However, some people, especially developers can have trouble prioritizing action over perfection. The major idea I took from this Ken Robinson TedTalk is that the better you are at school the better you tend to be at not making mistakes ( http://www.ted.com/talks/ke… ) Consequently, itโ€™s importantโ€”for a web startupโ€”to look for skilled engineers how are willing to act and can focus on whatโ€™s necessary without getting bogged down on the trivial details of perfection.

  24. Steve Poppe

    Dude, you are a fun read. Agree with all you say but with one qualification: action needs to be driven by a product “vision,” not product visions. Unfettered testing, in one man’s opinion, can be a real mistake. Peace!

    1. fredwilson

      I agree. Product vision doesn’t come from committees

  25. RacerRick

    There’s a quote I love from my old boss… “if everything fails there’s always porn”.

  26. reece

    Athletes understand this.Errors of COmission are better than errors of Omission.or as my college teammate and now CTO would paraphrase it: “do something or get the f*** off the field.”

  27. Ellen

    Hi Fred, I loved this post, and I agree with the test, measure, test, measure approach. I would like to add that one thing I have worked hard to do is to develop different types of tests and measures that are more helpful in early stages when there is a need to evaluate opportunities or partial concepts before commiting resources to the development of an idea. These provide good guidance at halfway points, and early indication as to whether you are facing a dead end or a path paved in gold.

  28. Lincoln Nguyen

    Hire slowly. Fire quickly. I’ve found that with a lot of entrepreneurs who are execution-focused, they overlook customer development. They never quite find the product/market fit, yet they hire a sales team, VPs, and raise loads capital before they’ve found the right market. For us it was best to approach product development with a parallel customer development process where we could learn and discover about customers.

  29. Beth Oppenheim

    I think this is an extremely important point – particularly the caveat of not advocating a “throw things at the wall” approach. That is sometimes what people perceive to be “taking risks,” but in reality – it could result in an inability to change your path.

  30. Aviah Laor

    Ah, the joy and curse of the startup Tabula rasa. When you start everything is possible. When you act – the damn limits and boundaries suddenly emerge.

  31. Richard Jordan

    I think this is one of those to bookmark and point people to later. I have tried to describe to others what makes one an entrepreneur in terms of skillset, and I have said that I make decisions a bit quicker and a bit more accurately than others with equally incomplete information. It’s that ability to pattern match and pivot quickly and often I think.There’s never been a better time for entrepreneurs in terms of tools out there to run one’s business this way. Move fast, figure out what works quickly. Great post.

    1. fredwilson

      I agree about better and faster and cheaper tools

  32. hypermark

    Totally agreed. My only add on this one is the first 15 people +/- set the culture of the company so being clear on the have to haves, nice to haves and can’t haves is essential.Also, would finesse Fred’s thesis slightly by saying that my experience here is that it is more important to do the “right things” than have to do everything “perfectly right,” and that’s where speed/action trade-offs come into play.

    1. JLM

      Managers do things right.Leaders do the right things.Entrepreneurs do a bit of both.

      1. hypermark

        Why do I feel like I set you up for the alley-oop dunk. ๐Ÿ™‚

        1. JLM

          Because YOU are running the point, controlling the action and getting the assist. Thanks. LOL

          1. hypermark

            Well, hopefully, my +/- differential is favorable when all is said and done.(btw, Hallmark is hiring in its blog commenters division). ๐Ÿ˜‰

  33. sachmo

    I’m going to play devil’s advocate for a second, and emphasize the risks of making a bad decision…At the one and only start-up company that I worked for, I was hired as a junior mechanical engineer to work on a new type of food processing machine. The other guy who started the same day as me was the senior mechanical engineer.We were the only 2 MEs on the team. (The other people were: a programmer, an electrical engineer, and a few manufacturing engineers / machinists that made our parts).I was pretty surprised when I saw the senior mechanical engineer on my first day of work. He literally looked as if he had rolled around in a patch of dirt before he walked in. I guess you could also say that he may not have fit in culturally with other people at the company.But the technical director was under tremendous pressure to get the machine built and moving along, and the reality was that if they had not hired him, it would probably be weeks before they’d find another senior mechanical engineer.During the design process, we compartmentalized the machine. We were expected to create working prototypes at an almost ridiculous pace, so there was no time to do any design reviews (in fact the subject never even came up). So I worked on my subsystems, as he worked in parallel on his. After we had completed our initial designs, the machinists / manufacturing engineers started making parts. It was immediately clear that none of the machinery he designed worked. Numerous mating parts did not even align together properly. The technical director eventually ended up firing him.The costs to the company were nothing to scoff at. He worked for about 3 months on designs before this came to light, and it took another month to replace him. His salary for that time was wasted along with much of the money spent on parts for his subsystem. Other subsystems of the machine that depended on his subsystem were held up. And maybe most importantly, it was highly demoralizing to the rest of the team that a large part of the machine would have to be redesigned.Aside from this one bad decision, the larger problem was that the machine was being designed at a reckless pace. To say that the timetables were unrealistic would be an understatement.A lot of corners were cut, and a lot of risks were taken (at the behest of our managers) in hopes that we gain a little bit of time here and there. 90% of the time these design risks ended up costing us much, much more time in the long run.I agree that it is good to be action oriented, but with the caveat that action be accompanied by clear vision and careful planning. Work hard, but also work smart.

    1. Aviah Laor

      the actual risk here, it seems,is that it took 3 month to discover the fault. but maybe that the way it in physical goods production

  34. Gino Goossens

    This is exactly why we work with a “duck-tape employee” approach. I’ve it takes someone more than 15 minutes to explain what his task is and how he is going to get things done, than I get bored and ask him “can you duck-tape your action together and get it to work?”. If so, just start with it and except the fact that we live in an imperfect world and sometimes things fail. Concentrate on recovery and choose the ‘controlled chaos approach’, because if you don’t you not only disappoint me but even more yourself. Two important rules though:1.) Make sure you can monitse it, so when things go wrong you no the ‘why’2.) It needs to work within the team or service your delivering it toThis works for us, not sure if it works for everyone. @tripess this is the way we try to work and also in my daytime job @Conrad_com I’m implementing this approach. (@ = Twitter names).

  35. dedicated server

    I totally agree with your thought process. But the line “” I’d much rather back someone who makes 100 decisions a day and gets 51 of them right than someone who makes one decision a day and gets it right.”” is true when one has to take smaller decisions. If someone makes one decision whose positive outcome is equivalent to 100 small decisions put together then i will appreciate that one decision.

  36. ShanaC

    I know I wasn’t able to post yesterday (and I am definitely really not today) but just the post by itself really made me think and helped me along yesterday. I’m in a big transition point (lots of last minute stuff, so much of last minute stuff), and I am doing a lot, and did even more yesterday, and it just was a really timely well written post. So thank you for putting it out there.

  37. thewalrus

    “perfect is the enemy of the good” +1…i would even say perfect is the enemy of perfect. perfection can only be found in the journey….

  38. Auren Kaplan

    Great point, great motivation at this moment. Much value here.

  39. Nigel Walsh

    A great post, as always – and some great comments and follow up. Dare I say, JFDI! Its important to do something, as many others have already said, inaction is the worst action to commit.

  40. Donna Brewington White

    I know you’ve already received a lot of pushback on the hiring comment but I’m still going to add my two-cents worth. I imagine that hiring decisions really are not so different from investment decisions. You might welcome an action oriented person running your portfolio company, but do you want that same person selecting your next investment? And that is exactly what hiring is — an investment — requiring due diligence, calculated risk, etc. Besides, you are potentially messing with people’s lives when you hire/fire…not to mention that the severing of relationships as people come and go can take a toll on your team — no matter how thick-skinned they are and no matter how much we resign ourselves to the fact that people coming and going is part of business life. And I haven’t even touched on the business costs of a bad hire…but I believe some others more qualified have done already done so. Fred, I already know that you take hiring very seriously…and that you excel at it. I respect this.

  41. Will Franco

    โ€œThe farther backward you can look, the farther forward you are likely to see.โ€ Winston Churchill.For a company: Time + Action = Distance.If you haven’t been in business for a long time, perform and measure more actions. As your business grows, you have my time and actions to base decisions on–the driver then needs to move into an analytical mindset, if they can’t they need to hire someone who has that skill. The transition is the key!

  42. AlanPearlstein

    your point will continue to take on more meaning as the cycle of innovation and business creation accelerates. the last thing I am comfortable with, as an entreprenuer, is inaction. i can live with my mistakes as long I create more successes. I am focusing on cutting my losses as quickly as possible to mitigate the bad decisions that come with action.

  43. Jim Jackson

    Only two places you can be in life. You are either getting the results you want or you are using the excuses you want.

  44. Trace Cohen

    If you’re going to fail, fail fast. As an entrepreneur you have a license to take risk, fail and get away with it. You need to realize that entrepreneurs are in the business of failure (I’m an optimist I swear!) as the majority of ventures never make it off the ground for the reasons stated above. As I’m sure most people find out, great ideas are a dime a dozen but it’s all about the execution that determines the outcome. This is a lesson that I will never forget.

  45. Colm Brophy

    There’s quite a bit of evidence and a huge quantity of anecdotal evidence that many of the most successful CEOs do not exhibit great powers of insight, vision or intelligence (there are obviously many exceptions); but rather the most unifying trait of this group seems to be their ability to make decisions.Actually it’s also been suggested that more intelligent individuals make worse CEOs due to their tendency to focus too much on alternative routes rather than the one they’ve started going down.

    1. fredwilson

      I believe it