I think people would be surprised by how poorly graduating from Harvard or Stanford predicts performance. Like people think, 'Oh, you must be a genius.' No, actually, yeah, you're probably a little bit stronger than, you know, people graduating in other universities, but not so much stronger. And often we find that people tend to lose some of that potential raw talent edge by being a bit more entitled and thinking too highly of themselves.
Okay, today we have Luca Ferrari on. I wanted to have him on for a long time because he runs Bending Spoons, which is this fascinating company. It's like a little bit of a private equity rollup company, but it's really a tech platform company and it's unique. I can't find any other company that sort of rhymes with it. He is very unique in the way he thinks and the way he builds and the way he CEOs. Hope you like it. Okay, Luca, welcome to Long Strange Trip. Thanks for coming on.
Thank you for having me. My pleasure.
Okay, I think by this point most of the listeners have heard of Bending Spoons, but I doubt they understand the model and what the magic is. So, if you wouldn't mind educating us like two, three minutes on how it works and what's special about it.
Yeah, sure. So the entire thesis on which the company is built is that if we can build a machine, a system whereby we can operate digital technology businesses better than almost anybody else, then we are pretty much guaranteed to be able to compound capital efficiently for a very long time through acquisitions. And the reason is that if a lot of businesses are basically better off once they're integrated into the system, what we call our platform, than being operated as standalone companies by someone else, then we should be able to offer prices to people that are appealing and so they will sell their businesses to us and we still deliver a high return for shareholders. So that's the thinking behind it. Of course the difficult part is to build that system, that platform, so that we can operate these businesses better than almost anybody else, and that's what we have poured our hearts and minds into over the past, well, 13 years technically.
And so we have tried to have an amazing team of people, strong culture, powerful proprietary technologies, lots of proprietary data. And what we do, we buy these businesses, we integrate them very deeply into this platform. So we have a shared R&D, marketing, G&A team that can fluidly move across all of our businesses. We basically replatform the acquired businesses so that they're based on the same technological foundation. Some investor at some point called it an operating system. I think it's a pretty apt comparison or metaphor. And then we transform them pretty deeply. So we can rebuild the org, rewrite big chunks of the codebase, rearchitect cloud infrastructure. We try to launch useful new features, fix bugs, improve performance, rethink monetization and marketing. So there is a serial acquirer component that you will find in private equity, you'll find in companies like Berkshire Hathaway or TransDigm.
The big difference, certainly vis-à-vis private equity, is that we are not a fund. We buy off our balance sheet, we've never sold a material business, we don't intend to sell one in the future, so we buy to hold and operate forever. And the other very big difference, definitely vis-à-vis private equity but also certainly, you know, the Berkshire's of the world, is that we transform these businesses pretty deeply and we integrate them all together. So they're much simplified, a bit like they go from being a company to being a product installed on the same foundation basically. So that's the model. I've been doing it for 13 years at this point.
Yeah, it's going remarkably well. You went public. What's roughly the market cap at the time of IPO a few months ago?
$18 billion, I think, equity value.
Congratulations. I'm a huge fan of the model. It's really unique. I was comparing it in my head to Berkshire Hathaway, but it reminds me when I was in my 20s, I worked for a US tech company called PTC, and they moved me to Japan to set up the Japanese operations when I was very young. And my office was inside of Mitsubishi headquarters. And so I dealt with Mitsubishi headquarters people, but like all the different divisions. It feels more like Mitsubishi or Samsung than it does like some big PE firm or like Berkshire. How would you describe it?
Yeah, I don't know those companies that well, so I can't say for sure. But again, the distinctive features are we buy to hold and operate forever. So I think that kind of strikes out PE firms. And then again, this very deep integration. Most companies that acquire other companies serially, in my experience, try to run them somewhat separately for the most part. At least that's what I've seen. We take the completely opposite approach where we make sure they have the same technological foundation, broadly speaking, the same core team that moves fluidly across to go after R&D opportunities and we draw when those are exhausted. And then a lot of serial acquirers keep these companies, you know, broadly speaking, the same way they were before. We change them completely from the ground up and it's very time-consuming and challenging, but the upside, you know, the bright side of that is we generally deliver very high returns. So I don't know, I think I don't really know of any company that does it this way out there, but...
It's kind of an N of one. I agree, it's kind of an N of one. Is the magic, Luca, in the picking or in the operating, and what percentage would you give it?
No, I mean it's almost completely in the operating. I'd say the platform I described, we couldn't do what we do. So I'd like to think we've gotten pretty good at, you know, selecting the right businesses, but it's relatively easy to deliver high returns if you have access to our platform because, for example, we have been enjoying an inflow of exceptional talent. We got 800,000 applications. Last year, we hired fewer than 300 people. So when you have amazing engineers, designers, product managers, general managers, it's much easier to take a business and rethink it from the ground up and run it much more successfully. Anyone who's run a, certainly a digital business, probably any business, but certainly a digital business for a sufficiently long period of time will tell you that headcount matters not a lot, but it's just how good the people are and the culture you've established. And so when you have access to this caliber of people, you can run a business with 20 people that someone else would need 200 people for.
And so that alone will give you both cost efficiencies and opportunity to innovate faster, improve monetization faster. So that's an element, for instance, of our advantage vis-à-vis these businesses being run as standalone companies. We have invested a lot over the past decade in building powerful proprietary technologies to do everything pretty much across the board that you need to run a digital business. They're natively integrated with one another and they just make everything so much more effective and faster. If I were to run one of these businesses on a standalone basis, I don't know that I would be, well, certainly wouldn't have the resources to build these technologies. Wouldn't even know where to start. And so, you know, that's also kind of a cheat code. So definitely the operational part is far more important than the picking. But we try to pick well, obviously. Why do it poorly if you can do it well?
And Luca, let's just, I want to click on the hiring. So I spend most of my time with CEOs these days and everyone talks about having high talent density, being a talent magnet, and a lot of them pull it off early, but as it scales it kind of inevitably waters down. You seem to have almost industrialized this talent density idea and you have some very unique ways of pulling in applications, pulling in interest, the top of the funnel of qualifying the interest. Let's just talk about the top of the funnel and talk about the qualification process and talk about it like roll the clock back when you were nobodies. No one had ever heard of you. You had no employer brand. You had no inbound interest. How did you get the talent flywheel kind of rolling?
Yeah, so we basically believe that if you have a strategy that works or can work, then almost all that matters is the talent you deploy toward the execution of that strategy and the culture, meaning like the rules of the game, how people interact with one another, what they choose to do and how. Those are the areas we've obsessed over pretty much since the beginning. Now, you're right. I mean, you start with nothing. And so that's what founders or early team members need to do well. That's, you know, basically punching above their weight. I remember early on spending at least 50% of my time, probably more for at least the first two, three years, on recruiting among other talent-related things. And a couple others managed to find the lists of the best graduates. At the time we hired pretty much only in Italy. Now we're international, but some of the best Italian universities, we managed to find the lists of graduates and we kind of tracked them down. And I remember calling hundreds of them, probably harassing a few until they accepted to join us.
And later we built a pretty substantial talent team. These days we have scientists, researchers, and we treat the selection of talent within our pipeline probably similarly to how a quantitative trader would go about picking stocks. So we look for all signals and then test signals against future performance to determine whether they're predictive or what combinations of signals are, and keep iterating. It's a very rigorous and sophisticated system. At this point we assess hundreds of signals in each application. So that helps you select potentially dramatically better given the same level of employer brand and ability to attract applications. And half the game is also attracting very good applications because if only geniuses apply, then it's easier to build a good team. And so there I think we have a kind of an unfair advantage with our model. We found that a lot of engineers, designers, product managers absolutely love the idea of being able to work at a company where they can spend nine months helping rebuild, say, Vimeo's video infrastructure and then six months rethinking advertising on AOL and then maybe a year building a platform technology, all with the same employer broadly speaking, with the same colleagues, with the same culture. The track record they're building does not get diluted when you change employer. Obviously a lot of that is lost. You have to reestablish credibility. And so that's a very powerful point of attraction.
And the other one is because we've been so systematic and uncompromising on having extremely high levels of talent density pretty much from the beginning, of course, compatibly with our appeal to candidates at each point in time. Once that's in place, it's a powerful means of retaining excellent performers and attracting more of those because when people find that they love their colleagues, they never leave. We have essentially zero regrettable churn. We had 6% regrettable churn of Spooners, the members of our core team, last year. And trust me, there are poaching attempts from big tech all the time. So it's not for a lack of opportunities. And equally these people will tell their former fellow students, you know, 'Oh, it's amazing here, you should apply.' So it makes your life easier, but it's very difficult to get to a very high level of talent density late in a company's history. You need to establish it from the beginning and just be completely obsessed with it and never giving up, even when it means hiring way fewer people than you'd like to for prolonged periods of time.
Parting ways with people who are being helpful just because you think you have better people. It's quite painful both because nobody's a sociopath here and as in most companies you don't like to tell someone who's a perfectly good contributor that they should look for another job. And also you're losing good capacity in the short term to look for amazing capacity down the line. So those are difficult things to do, but if you do them consistently, I think you develop a very powerful flywheel.
Sounds like you get kind of a data science type team that is looking at all the inbound and is looking for signals. What are the signals that are most strongly correlated with success? The R-squared is high. And then once you get beyond that, I assume there's a human interview. What are the questions that tease out what you're looking for that maybe aren't obvious?
Yeah. So we are fairly secretive about the details. I guess you got a similar answer from my quantitative trader, again that was my metaphor earlier. But no, I can share some of this. There are some obvious signals in people's applications. You know, their GPA, for example, it's not super strong but it's helpful. The university they graduated from. I think people would be surprised by how poorly graduating from Harvard or Stanford predicts performance. Like people think, 'Oh, you must be a genius.' No, actually, yeah, you're probably a little bit stronger than people graduating in other universities, but not so much stronger. And often we find that people tend to lose some of that potential raw talent edge by being a bit more entitled and thinking too highly of themselves. But it's still predictive. I mean, all else being equal, someone from Harvard will do a little bit better than someone from a less well-known university. So some of those are probably somewhat obvious. There are many that are not.
One I can share is relatively predictive. I was surprised when this came up. We found that if someone is politically active as a teenager but ceases to be in their early 20s, that tends to correlate highly with someone's drive and entrepreneurial mindset. And the way we have explained it is, which are highly valued qualities, the way we've explained it is that if you are 17 years old and school is not enough, you feel like you need to do more. That shows agency, that shows productivity, that shows a level of not settling for the status quo, that's generally healthy. But if you still do that when you're 25, 26, 30, it means it's probably a life mission, which is perfectly fine, but likely incompatible with your job, your career being top priority. Your job probably takes a backseat to your political aspirations.
How do you find that signal? Do you ask them that question in an interview? Do you look through their old Instagram? Like how does that signal even arise in the process?
Thankfully, people think they need to include leadership experiences in their CVs because that gets you a job at a consulting company or something. So most people we find would include something significant in that area if they did it. But in any case, we do ask later in the process, whether it's an interview or written assessments, questions that would very clearly lend themselves to people sharing this sort of thing. And with this I'll get to the other thing you can do, which is you shouldn't be passive in accepting whatever signals are present in someone's application. You can be very proactive. We find that a lot of the best signals in our case come from the practical tests, the things we do or ask candidates to go through. And so you can elicit signals that way. Interviews, of all the typical elements in a selection process, at least in our experience, they are the worst predictors. But you can make them decent if you give interviewers extremely precise questions they need to ask and you tell them to ask them exactly in the same way, and then you make sure that the answers are recorded and assessed separately. So what's completely useless pretty much is having someone talk to someone else with essentially no guidelines or just a high-level agenda and then tell you, 'I liked the guy, I didn't like the guy.' That's noise pretty much. So if you structure it a lot and you try to separate the actual conducting of the interview from the evaluation of the responses, then it can be somewhat predictive.
Can I tell you about HubSpot? We unlocked on the sales side a good process for doing this where we scaled our inside sales from 10 to a thousand. We're kind of like you. It was harder to get into HubSpot than Harvard. So we had lots of inbound and we would look at all the resumes and we would look for people who went to a state school, you know, went to University of Vermont, University of Wisconsin. We weren't looking for Harvard and MIT. And we'd look for a person who had done a sport, who was athletic and competitive. And we didn't think too much about it. We didn't interview them in a standard way. We just said if they look kind of like this, let's give them a half an hour. And we'd give them a half an hour with a person. And what that person would do was set up a role play. So I would be the HubSpot employee, you'd be the potential customer. I'd set it up and then I'd have you sell to me, and I'd give you 12 minutes to sell to me. So selling me whatever, and I'm hearing, I'm giving you objections. We finish it.
Then I would give you feedback, Luca, on how you did. I'd give you a minute to think about it. And then we'd do the exact same thing again. And if the person absorbed that feedback and did a half-decent job at the pitch, we would do a couple blind references. Boom, we hired them. That actually really ended up scaling for us. We didn't do the normal interviews, that really worked on the sales side because I kind of agree with you. The other thing I wanted to ask you about, it's just blind references, like where is that in your signal?
Yeah, we do that as the very last step. Well, so no, we don't do actually blind references. We do references. We don't do blind references because they're illegal in Italy. So you can't ask. And so we figured, okay, let's just have a method that works across jurisdictions. Even though I know in the US you can call people and ask, 'Oh, how was this team member?' But we do references. It's the candidate who presents a few names. We try to guide it toward, 'Okay, give me people who you know had plenty of exposure.' We try to get at least one person for at least the couple of biggest experiences someone had, and ideally their manager if possible, but ultimately it's their call. And we structure those interviews with references quite a lot as well, and we find that they can be predictive, but again you need to be scientific about it. If you leave it to someone picking up the phone and calling, then almost always it's positive. You know, very rarely do people give you names of people who will criticize them, and so you need to be very specific in your questions and ask to make hard grading decisions. You know, for example, we ask them, 'Okay, of the 20 people you have worked with the most,' say something like this, 'would you say this person is the best or top five?' And then you try to ask a few follow-up questions to make sure there's a little bit of substance behind that response. And you find that people who are enthusiastic, often they will tell you, 'Well, it's above average.' And you're like, 'Hold on a sec. It sounded like this person was a genius, and you're telling me it's maybe ranked eight out of 20.' Which is nice, but you know, so you can make it predictive, but you need to put in the effort and the structure before you get there.
Okay. I love that advice. I get a lot of blind references when people do that to me. I think it's brilliant when they ask, 'Is that the best person that's ever worked for you?' Well, no. Then they say, 'Why?' And okay, that opens things up. I want to talk about you. You're the 20th CEO I've interviewed. It's been really fun. And honestly, my thesis when I started this podcast was I'm going to figure out kind of the common thread, what everyone's doing, and I'm going to write it down. I'm going to kind of standardize it. The truth is there's not even close to a common thread. Everyone does it differently and there is no playbook, and the playbooks are changing extra fast right now. My last two interviews are emblematic of it. I interviewed TK from Kaseya, and he and his co-founder have, I forget, 200 employees. There's no levels of management. They all report to those two. And he referred to it in the podcast as management by chaos. My last interview was with Ali Ghodsi from Databricks, and he's got eight direct reports. It's very structured. His direct report team, he has three meetings a week with his direct reports. He has a QBR once a quarter and then he has offsite strategy session once a quarter. So like polar opposites, both doing extremely well. Where do you fit in that spectrum?
Probably somewhere in between. I think these things are generally, like, the more formal approaches to management, I think they are greatly overestimated in their impact. I think almost all of a company's outcome depends on essentially your strategy, what people sometimes call product-market fit, but also the moats you have, and that's overwhelmingly what drives it. I always ask myself, to me a business is a good business if it would do well even if management was mediocre, maybe not awful, but mediocre. So that's the first thing. And the second thing that matters to me is talent levels and culture, which culture is really like, you know, how do you make decisions? What matters? What doesn't? What do we value? What do we not value? Then everything else, you know, reporting lines, whether you have OKRs or you keep it fluid and informal, span of control. I'm sure it does matter on the margin, you know, making things a bit better, a bit worse. And I'm sure different solutions would be optimal depending on the people involved because ultimately a manager, a CEO is some sort of a leader, or should be, and the same strategy, the same approach to working with others depends on the human capital you have. Different people react differently to the culture you're trying to foster, but I think that within reason that doesn't make a huge difference, maybe like a plus-minus 10% kind of impact. So I think you're much better off obsessing over, well, first and foremost the strategy, but then once that's in place, the quality of the people and the culture you establish. So if the 200-person organization is chaotic, super high, I don't know them, but assuming super high talent density, a culture of business orientation, rationality, hard work, even if a little extra structure theoretically could be helpful, I think the talent and the culture will mostly trump any such gap or close any such gap. And vice versa, maybe in the other extreme a little bit more fluidity and flexibility would help, but if you have very good people and a great culture of 'let's get it done for the benefit of the business,' people will not get stuck because there is a little extra structure. So I haven't thought a lot about these things. I'm convinced they're not the most important thing, to be honest, in excelling in business.
Fascinating. When I was a CEO, I tried to get better and evolve as the business scaled. And I got a lot of feedback, and one of the pieces of feedback I got a couple times was, 'Brian, you're a very good leader and a very bad manager.' Are you, where are you on that?
I don't know. I get a lot of feedback. I don't think anyone kind of rated me against those two archetypes or job descriptions.
How about a little self-reflection here?
I don't think, yeah, I'm not sure if I'm a good leader or a good manager, to be honest. I generally feel that I'm pretty privileged that I work with very good people, and I tend to be more self-conscious and question whether I'm doing enough and I'm living up to expectations. So I tend to see the glass half empty. So my instinctual reaction would be I'm probably not terrible at either. I would be disingenuous if I told you I think I suck. But I would probably rate myself something like okay at both, but not necessarily amazing. I'm probably a better leader than manager, if I understand what you're hinting at. I think I've generally done okay at setting a vision that made sense and a compelling vision and communicating that reasonably well.
If I've succeeded as a leader, it's been mostly through what I would call servant leadership, like just working super hard and helping people as much as I could. I don't think I'm the kind of William Wallace kind of leader, someone making a grand speech and everybody gets their hearts pounding and everybody gets to work. But when you work with someone who walks the talk and is in the trenches and does their best, I think you tend to be inspired. So maybe that kind of person. I try to be that kind of person. I don't think I'm a great manager. I don't think I'm the best at running one-on-ones or anything like that.
Okay. One of the things I used to say to myself is actually, I got this quote from Eleanor Roosevelt of all people. I wanted to keep my head in the clouds but my feet on the ground. And by that I meant I wanted to be, okay, a JV William Wallace, painting a picture of the future, getting everyone excited about where we're going, looking over the horizon. But being on the ground, it's like, 'Holy crap, there are a lot of problems and we have to deal with all these freaking problems.' And my glass was very half empty and I spent a lot of time a little negative looking at the problems. Where are you in the Eleanor Roosevelt quote?
I want to give myself a little pat on the shoulder. I think if there's one thing I tend to do reasonably well is being able to see the big picture. So, you know, I guess head in the clouds kind of thing. Maybe I'm not the best at, say, articulating it again with the grand speech, but I think I'm pretty good in the substance at understanding what matters, what doesn't, where the opportunity is, what logically we should be doing and what's just noise. And I think I've historically been very hands-on in the details, in the trenches. I think it's a good quality that you want to have as an entrepreneur and CEO. I don't think it's super widespread in the population, but it's quite commonly found, I think, in entrepreneurs and CEOs. And I think it's quite powerful because if you don't have the big picture, you can't really set a directional strategy that's the winning strategy, unless someone else brings it to you, which is always dicey, but you can't count on that happening. Hope is not a strategy, as they say. But if you're not in the details, in the trenches, feet firmly planted on the ground, then I think you're unlikely to be able to inform that big picture properly. You're unlikely to be inspiring to your colleagues. Very few people like working with people who are in an ivory tower, who don't get their hands dirty. It doesn't really scale. I think it's not good. You're not in a position to assess others, to coach others, because you don't really know anything about the work at some point. So I do believe you need both to be successful. And finding some sort of equilibrium, I find it's easier to sequence those activities than trying to run them in parallel. So I try to have times where I'm very much in the clouds thinking, okay, what are the big problems or big opportunities, how should you go about them, and be more of an architect, and then long stretches where I just get into execution mode and I'm, you know, mud head to toe, just getting stuff done, you know, blood, sweat and tears. I think it's quite difficult to be both at the same time, but you can be both in sequence.
Let's talk about coaching for a second. Similar to me, I had never been CEO of a company with thousands of employees in public and I was figuring out as I went along, and sometimes I just didn't feel qualified to coach some of my executives. Do you ever have that feeling? And also related to that, so many of the CEOs I'm working with, they have a very talented person internally, they're on their way up. Should they bet on that person or find someone who's seen the movie before and has a little bit of experience? That's happening everywhere across Silicon Valley right now. Should we hire the person who's been there and done that, or should we bet on the person who's on their way up and really hasn't seen anything close to this movie?
So on coaching, I'm certainly inadequate as a coach often with people I work with. I think at Bending Spoons we work on the assumption that our managers should always be capable of solving or advising on a solution across all problems that are experienced by the direct report. We just think that any one person may be able to coach any other person on some things and they should do so regardless of reporting lines. I think a good manager would generally be someone very smart, a good problem solver, so at least they can provide kind of generalist support. They should be emotionally supportive and ready to get their hands dirty. But ultimately, being someone's manager doesn't mean you're always better positioned to solve a problem for them. There are so many skills needed in a business like yours, like ours, that obviously you need to divide and conquer. In any case, I've never been a big fan of, I mean we do value experience, but I think we value experience a lot less than most people. I believe that yes, being there and done that helps, but there are a few big buts. The first one is the world changes pretty fast. So I'm not exactly certain that someone who did something seven years ago, that still applies all that well. And there is a huge risk that people will be blind to the new context because they did it that way and they will just try to paste whatever solution they applied before. So maybe you buy some good, but you also buy a lot of bad. I'm not sure which of the two is stronger for a company like Bending Spoons.
Also we have such a, as far as I can tell, distinctive culture that we found that every time we hired someone, almost every time we hired someone very experienced, they struggled to adapt. We're so hands-on, no politics, radically candid, everybody needs to carry their own weight, and it doesn't translate well. Often people who have been successful at large tech companies, they tend to have a different style of leadership which may very well be optimal at those companies. I don't know, but it's not at Bending Spoons. So we also need to account for the cost of that cultural change, which sometimes doesn't even happen, and if it does it takes a long time. And last but not least, I find that generally people lose motivation as they gain experience. And so you need to consider whether it's better to have someone with 20 years of experience but, I don't know, six out of 10 motivation, or someone with two years of experience but 10 out of 10 motivation. I find often the latter is better. It depends on the... situation. So we're generally we we're not big on on experience. We have hired experienced people occasionally. We prefer to hire.
Has that changed as you've scaled? Have you changed your mind at all on that or you're like actually no?
Yeah. Interesting.
No. And I may be wrong. Look, we have tried. It's not that we never hired experienced people. We have hired some experienced people with great success, you know. It's not that we were completely close-minded regarding that.
Um, no, we keep investing in students or new graduates or people with a couple years of experience where we think that we can really help them mold their skill set and professional culture in the way that we believe will best serve them and the company in the long run. Um, and also there is a trade-off between talent and experience in a competitive labor market and, you know, experience we can provide it to you. We just need to be a little bit patient. Talent we can't and so we focus more on talent than experience. So all considered we're happy with this. We wouldn't change it necessarily. Uh but we have encountered difficult situations sometimes where maybe we have, you know, a 25-year-old lead engineer or something showing up at an acquired company and essentially being the person in charge on our end and people with 20 years of experience thinking does this guy even know what he's doing? And I think our track record consistently shows yeah it does or she does but uh I can see how it's a more difficult sale than if we had a 50-year-old person with 30 years of experience come in and say the same things. It's much easier to assume that person is competent.
I've spoken to a couple of the founders of companies you acquired and one of them said the person that replaced them was 25 and the other said the person who replaced them was 27. Um, they didn't seem bothered by it, but I thought that was kind of interesting. What I'm curious about is like, let's just say that 25-year-old that takes over, I don't know, mirror or whatever company you're buying. What are you looking for in that person who's going to run that show? Is there a certain quality you're looking for? I know you rotate them around, but let's say it's the first first go at it. What are you looking for?
Yeah. And we wouldn't put someone in that position who we haven't tested in a smaller version of it to be clear. So it's generally someone who led a team or a smaller business before. Uh but yes it could be someone with just three four years of experience very very uh junior. Um well on a high level we look for smart and what we call extreme ownership. Being smart for us, I mean pretty obviously is you learn very quickly and we have evidence of that and you're capable consistently capable of high quality reasoning. So when you propose a solution or you diagnose a problem consistently what you say or write makes a lot of sense. There's many of all the all the answers but your analysis always rational, accurate, logically sound. Um, we think that works across the board and in almost any position. Two, uh, we want you to have extra extreme ownership, which means you are absolutely you care tremendously about being or becoming the best in the world at your job, bringing the greatest possible contribution to your team and the company. It's you're almost fanatically about that. So when you find an obstacle or you identify a shortcoming in your skill set, you'll be hellbent on overcoming that. But then of course we look for more specific skills. But that's really like we find that that's 80% of the of when those are in place in big ways, those qualities that you're very very likely to succeed assuming you're you know you can communicate a little bit, you're a nice you're not an those you know hygienic factors. But the core killer features are those two.
And when it doesn't work, so you put in the 25-year-old to run it and like I don't know, there's an immune system rejection or they just weren't up to it. What is it that that falls down?
Uh I think when uh that that's happened very rarely. I can only think of one or two cases, but when that's happened, I think it's been primarily um one of two things. One, uh the person while very very good um so it could also be that we misjudged those qualities but so far it hasn't been because any of any such uh we haven't seen any such case at least for for our general managers what what we've seen is either the person we we basically we didn't pay enough attention at a person's ability to to to lead others call it communication a certain level of common sense and empathy and so they were incredibly smart problem solvers. They moved 100 miles an hour, but they failed to notice when someone was a little bit off, had an issue. They didn't say the right thing at the right time, and that basically created a level of hostility or at least friction that ultimately made them untenable as leaders. The other case was where enough people in the org for you know all sorts of reasons felt more competent and although this person was great and super nice and empathetic and communicative these people couldn't get over the fact that oh I'm so much more experienced I cannot take even if you know like I cannot be led by this person even if just formally that's been very rare but I can remember once one such case where that occurred and look and there we could do one of two things. We either move or part ways with you know these people who reject leadership or we change the leader and you know it depends on the context which of the two makes more sense.
How do you develop these people? Like do you actually train them, develop them, coach them or it's like they're smart, they're going to figure it out, you kind of throw them into it and they they're they're good.
Yeah, we have training materials, but broadly I think 90% of the outcome depends on you throw them into the deep end of the pool. You know, you give them way more responsibility that seems reasonable and uh and then you surround them with amazing colleagues. We find that we learn primarily by working with amazing people. Almost invariably some of the people around you will be better than you at some things. And so if you are if you try to emulate those good traits, you'll learn from those. And also you know they will suck at some things and if you notice the weaknesses you can avoid you know falling into the same trap yourself. Uh so the level of responsibility and the level of talent around you are the two things that we find drive growth the most. Um but yeah I mean a little bit of formal training here and there and active coaching certainly adds that 10 20% extra for sure.
