The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers (Summary)
Imagine your company is about to run out of money. The stock market has crashed, your IPO is dead, and you have to lay off a third of your staff. You go home and tell your wife, 'We're going to lose the house.' This isn't a hypothetical business school case study; it's the reality Ben Horowitz lived through. The 'hard thing' isn't dreaming up a big vision; it's waking up in a cold sweat, knowing everyone is looking to you for an answer you don't have.
There Are Two Kinds of CEOs: Peacetime and Wartime
Companies need different leadership styles depending on their circumstances. A Peacetime CEO focuses on expansion and creativity, while a Wartime CEO must make brutal, decisive moves to survive an existential threat.
When the dot-com bubble burst, Horowitz had to transform his company, Loudcloud. He shifted from a Peacetime CEO focused on growth to a Wartime CEO, executing mass layoffs, selling off the core business for a pittance, and pivoting the remaining 75 employees into a new company, Opsware, just to survive.
How You Lay People Off Matters More Than Anything
The way a company handles layoffs defines its culture for years. It's a moment of truth that reveals the CEO's true character and the company's values.
When forced to do layoffs, Horowitz personally trained his managers on how to deliver the news with respect. He insisted on being present and visible to the entire company immediately after, taking full responsibility and answering every difficult question to show the remaining employees that the company, and its leader, had integrity even in the darkest moments.
The 'Shit Sandwich' Doesn't Work
When delivering difficult feedback, don't soften the blow by sandwiching it between compliments. This common management technique is confusing and dishonest. Be direct, clear, and focused.
Horowitz had to give a brilliant engineer a negative performance review because his abrasive attitude was poisoning the team. Instead of using the 'praise-criticism-praise' method, he sat down and said directly, 'Everybody thinks you're an asshole.' The shocking directness broke through the engineer's denial and allowed for a real, productive conversation about his behavior.
Embrace The Struggle
The journey of building something great isn't about avoiding problems; it's about confronting a constant stream of them. The 'Struggle' is the universal, agonizing feeling when you're failing and the odds are against you. Accepting it is the first step to overcoming it.
A friend, another CEO, called Horowitz in desperation, asking, 'What's the trick?' Horowitz's response was simple: 'There is no trick. The trick is that there is no trick.' You can't hack your way out of the hard things; you must find the courage to face them head-on, day after day.
