Quotes from Frank Slootman on the Invest Like the Best podcast
Link to episode: Invest Like the Best: Narrow the Focus, Increase the Quality - with Frank Slootman and Patrick O'Shaughnessy.
On leadership, confrontation, excellence, decision making, productivity, priorities, execution, competition
"The thing you're fighting in an organization is that people want to let things pass." Tweet this
"Suffering and tolerating mediocrity is the absolute worst reflex you can have." Tweet this
"Understanding how things work, it's really important, rather than mindlessly implementing a blueprint or a playbook. "Do our playbook" is the worst words I hear." Tweet this
"Fewer things to deal with is a very, very powerful thing. A lot of organizations can't get out of their own way because there's too much going on at the same time." Tweet this
"If you're too parallel, you're what I call a mile wide and and inch deep and everything slows down. Human nature is to go highly parallel because we always pile stuff on and we never take stuff off. Things just get bigger and bigger and then we get frustrated because things are not getting done. Then we start making shortcuts. We're lowering our standards. You get all these problems that happen when you're too parallel in your approach."
"Sequentially, you get things done actually faster. And also the dynamic of the organization changes because you have uncluttered the workload. You have crisped it up. You now understand the priorities, and now you have the quality of bandwidth and the amount of resources that it needs to advance fast. As opposed to "I got so much going on. I'm just trying to get things off my desk now"."
"Confrontation is just our normal MO. I never think of them as being great. The thing is, we're malcontent. We consider ourselves sort of always unhappy with the status quo and there's always room up. There's always this gap that exists. If there's always a gap, in regards to everything, then there's always confrontation. You're confronting the variance all the time. It's sort of a normal mode. It's the mode you're always in."
"Narrowing things down, whittling things down - it's a healthy process to reprioritize all the time. Really crisp up. What are we doing? Why are we doing it? And to reexamine, what are the reasons? Is that still valid? Once that clarity starts to surround the whole workload, everybody gets pep in their step. They are reenergized. They now know what to do, as opposed to wondering how should I even approach this?"
"One of the reasons that I'm a fierce executor is that I had to take on really lousy opportunities and then massively exceed expectations in order to be viable as a person in business. That's where that ferocious mentality comes from. Because I didn't have mainstream credentials, and I couldn't make my way into the business world in this country the way everybody else did."
"Government can print money, and they do plenty of it. But for the rest of us, we have to take it from somebody else. And once you come to that realization, you also find out that they're not going to take kindly to the fact that you're taking this from them. And the bigger you get, now you become a looming threat and they'll fight back with everything they have."
"We debate pretty hard, and people debate me. I get called out all the time by people who don't agree. I love that. And the reason is, I don't want to be wrong. So, people keep me safe from myself. It's much more important for the organization to be right than for me to be right." Tweet this
"A playbook is just the worst reflex because you want to throw the playbook out and be first principles, and situational, and understand things as they are, and then go from there. Rather than "Well, I've seen this before. I've done this before. Boom, boom, boom. Here we go."" Tweet this
"You're better off ripping the band-aid off and moving, create clarity sooner rather than letting things percolate and people just staring at each other, like, what's the next shoe and the next shoe to drop. You don't want that. You want to get through it as fast as you can." Tweet this
"It does feel like war, and not war in the sense that people are going to die, but companies are going to die. Companies are dying every day. Then they don't reach viability. And then a lot of old ones that were successful once are basically decaying on the vine." Tweet this
"We talk about specific things, that this is not working well. Why are these guys not come up? It's a very, very inquisitive probing, trying to understand what's going on, raising the bar. In other words, always have higher expectations." Tweet this
"Every business unit is going to become an expert data science team. You have to, because data is becoming the beating heart of a modern enterprise. I want to say digital enterprise, but that's the same thing." Tweet this
"You need to define what winning is. I've always quoted US Grant and other people. They defined victory as breaking the enemy's will to fight. It was not just kill them. It was breaking their will to fight." Tweet this
"You operate with imperfect information. That's always the case. You have to be comfortable with that. It's possible you're wrong about things. Then you just need to be a fast course corrector." Tweet this
"You learn by trying things. And it's when you don't do anything, you learn nothing. That's why people put up ten priorities because they don't have to test their assumptions, they're "safe"." Tweet this
"It's all about amassing resources on as few things as possible. That's when you get momentum. If you spread your resources a mile wide and an inch deep, you're already dead." Tweet this
"People think being in business is all the same thing. No. It changes dramatically from one stage to the other, the modes of execution." Tweet this
"Let's try to be wrong. Then, because once you say what you think, now we can go and investigate whether that's correct or not." Tweet this
"Most dogs don't hunt. Way too many companies perpetuate out there and get money, and they are just the walking dead." Tweet this
On growth, sales
"Stretching and leaning in harder and harder and harder will reveal to you what your growth model really is, because this is a very hard question to answer. But trying it is going to teach you where the limits are. And I have never overdone it in terms of leaning in. I have underdone it in hindsight many times because I, just like other people, was a little skittish and afraid that we're pouring out so much resources and then we can't convert on it. That's the reason why people don't do it. But you need to explore these boundaries. How far can I go? And what are the signals that I can possibly get when I'm overdoing? By the way, if you're still in the chasm, you're overdoing it in a hurry because you're not ready to apply resources, and you'll have sales productivity problems up the wazoo. That's very common."
"Growth is incredibly important. Not just because we like to be a high-growing company and have a great evaluation and all that, but growth is what separates the winners from the losers. That's how you get into a winner takes all, winner takes most type of model. Growth is strategically important in any way you think about it. So, if growth is not on your mind, at least in our world, you don't know what your job is. It creates value. It creates a strategic separation."
"You cross the chasm when you can sell mainstream marketplace, that's a whole different deal. You're no longer in business development, you're in sales and sales is a highly scalable, repeatable, predictable yield ramp type of process. It is completely different from business development, which is a one off approach. Every customer is a one off situation. Founders can often make sales in all situations, but don't confuse that with viability."
"There's a real limit to what sales people can do. I hate to break it to you. They look at you horrified that you would even suggest that it might be something else. It's just a ridiculous conversation. It's this inability to look at things the way they really are versus the way they want them to be."
"Management in sales is by far the most important. You can rip out any other layer. The combat unit - direct reps - and the first line manager, that's really what makes up a sales organization. Everything that comes above that, I call them the post office passing on the news." Tweet this
"You can have really good numbers and still be a highly underperforming company, boards are sometimes shallow in their assessments. They get the numbers and they go "Check, everything's going great". Well, that's not how it is. You really have to get behind the numbers." Tweet this
"I can't tell you how many conversations I've been in where people are like "Oh, we're going to change the VP of sales" and we're like, why? "Well, we're not scaling". I'm like, "How do you know it's the VP of sales? Could your product suck, might that be the reason?"" Tweet this
"We're all selling all day long. If you don't realize that, you don't know what your job is. That has to be so important to you and demand generation and all the disciplines that basically make up the drivetrain of the business. It is so incredibly important." Tweet this
"In a world of software, you break the enemy's will to fight when you are hiring their people, because they have given up. They'd rather be with you than with the other company, because it's too hard and too painful and they're not making money." Tweet this
"Growth is not a mystery. It's just mechanical. It's just "What can you do? How quickly can you do it? What's the productivity? What's the ramp? What's the conversion?" It's something that you can break down and improve upon over time." Tweet this
"There's huge value in mastering and controlling your own distribution. You own your own destiny. If you try to farm out your distribution, you're beholden to another entity. And I think that's incredibly unwise." Tweet this
"You have to be a student of sales. And it's a machine that has to be highly repeatable, highly scalable, and very predictable in terms of the yield versus investment that it takes." Tweet this
"It's a pretty damn important question to ask "Okay, what are the limits of growth and what are they?" Not how much. What can you do to drive your growth to higher levels?" Tweet this
"Scale is a totally different mode than being in the formative stages where you're sort of in the desert looking for water, very opportunistically." Tweet this
"In high growth companies, sales productivity should be trending sideways or down. That's how you know you're hiring fast enough." Tweet this
"When you lean in harder, as you're finding these boundaries, you're now also learning how to move those boundaries." Tweet this
"Past glories are poor feeding" - Isaac Asimov Tweet this
On people: hiring, firing, communication, culture
"What's really important to us is that we're a highly lateral organization, meaning that the org chart, which is very vertical, is really not that important to us. I treat a lot of people that officially, on the org chart, report to me and people that are actually a level below that on the org chart, I treat them exactly the same way and I have weekly check ins with them. I talk to them just as much. I have just as intense an interaction with them."
"That is the Highlander analogy because every time the Highlander kills another Highlander, he takes on the strength of the other Highlander. The same thing is true in software. If I'm hiring a top salesperson or top engineer from another company, I've taken their strength now into my organization. It's not just that I gained theirs, but they lose theirs. So it's a double impact. I weakened them and I strengthened myself."
"I'd rather have nobody than somebody who is not functioning because those become real leadership traps because everybody sees that person is not functioning. You're not doing anything about it. That's how you lose your leadership mojo. You can't tolerate it. You're better off, than on, and then taking your time finding the replacement."
"Everything revolves around talent ... The talent game is really, really hard, and it's the lifeblood of an enterprise. You cannot run companies with mediocre people. You simply can't. You're not going to make it. You're not going to survive. It's absolutely everything, and there is not that much of it."
"Recruiting is another version of sales. I also agree with it's another version of M & A. Because they're all in the same spectrum. When you do M & A, essentially what you're buying is talent. The way you buy it through a company, you can also buy it through hiring people. Sits on the same spectrum."
"You're not so much inspecting the people, you're inspecting the work. That may sound like an obvious distinction, but if I don't know the people, obviously I can't tell - but I can certainly look at what they're responsible for, if it's functioning or not." Tweet this
"I think interviews are highly overrated. It's like two dogs sniffing each other, deciding whether they can even get through the door or not. There's nothing wrong with that, but you're going to base the hiring decision on that? You're insane." Tweet this
"The business side has become incredibly technical, to the point where they have an easy time having conversations with the technology side. In other words, you just can't live in this business anymore without being technical. It's impossible." Tweet this
"People don't spend nearly enough time doing background checks and it's easy to do. You get on LinkedIn. You can find the contemporaries of this person, the ones that work in your company." Tweet this
"That fluidity of an organization, the lateral nature and the network nature of it is really important because we really operate through influence, not through rank and title." Tweet this
"Culture sorts people. We're super transparent because we want to know that this is really what they're coming for and then it's going to be a really great fit." Tweet this
"I've never been wrong removing people from their jobs and I've never been too early removing people from their jobs either. I have been too late however." Tweet this
On product, pricing
"You are not going to get a special one off deal. I don't care how big you are or how big of a deal you're doing with us, you're getting a price that is commensurate with the volume of business that you're doing with us. I need to have discipline in our markets. I cannot have you find out from somebody else tomorrow that you are subsidizing somebody else's business or that somebody else is subsidizing you. We just can't have that."
"You don't want customers to hand you the solution. You want them to hand you the problem. ... That's where the innovation and where the spark happens. ... Otherwise you're constraining the possible outcomes already, prematurely." Tweet this
"Developing your own distribution capabilities is very, very high value. Most companies think it's all about the technology. If you master your own distribution, you become insanely powerful." Tweet this
"It's better to sell nothing than something because if you sell nothing you can stick a bullet into it and move on and then reconstitute the resources." Tweet this
"I hate incrementalism, because it assumes the status quo and it inches forward from there. It's a mind numbing way to go about your day." Tweet this
"I'd rather walk away than I go and screw up the discipline and the consistency and the integrity of our pricing." Tweet this
"The first the reaction people have is, "Do I trust this person?" They may not ask that question explicitly of themselves, but it's visceral. You decide for yourself whether you're getting the right vibe or the wrong vibe. And then you try to corroborate your impressions based on interactions and actual experience."
"Focusing on trust is a real thing I think is very, very important. I think a lot of people think they can say what they want and they're never going to be held to account. That ain't true. You will be held to account. You just may not realize it." Tweet this
"You can lose it in a blink. But earning it takes a huge amount of time and effort, and many, many instances where you have to prove it. So, it's a very delicate and extremely valuable currency, and it exists in every walk of life." Tweet this
"Over time, when people say "Yeah, this guy is consistently true and correct about stuff." Then they start believing, face value, what you're saying and what you're doing. And the opposite is also true." Tweet this
"Trust is a notion that permeates our whole organization, not just with customers, but with investors and employees and partners." Tweet this
"When you have trust, everything gets easy. And when you don't have it, everything gets, not just hard, but sometimes impossible." Tweet this
"You don't get the benefit of the doubt. Trust needs to be earned very studiously." Tweet this