--:-- Sonal Choksi: How do you build, set, shape, fix, and change your culture? While this is as relevant as ever for startups and companies today, leaders have sought the answers to these questions for hundreds of years, and there is practical advice to be had by examining different cultures across time and around the globe.
--:-- In this episode from December 2019, A16Z co-founder Ben Horowitz sits down with host Sonal Choksi to talk about what actually makes up culture, whether in a company or in any organization or team, as based on Ben's best-selling book, *What You Do Is Who You Are*. They discuss the idea of culture as code, the nuances of setting and changing a culture, and how to apply the principles from his book to startups, the tech industry, and any company today.
--:-- Hi, everyone. Welcome to the A16Z podcast. I'm Sonal. And today, I'm so excited since we finally have our interview, the A16Z podcast way of co-founder Ben Horowitz on his new and best-selling book, *What You Do Is Who You Are: How to Create Your Business Culture*.
--:-- The conversation, which took place recently at the Computer History Museum between me and Ben, probes on the themes of business, culture, and tech from the book and beyond, with lots of nuanced discussion on everything from common tropes, such as reality distortion fields, fake it till you make it, Silicon Valley folklore, whether companies and people can change, diversity and inclusion, and so on. All told through some tough stories.
--:-- On that note, just a note for listeners with kids in the car, that this podcast talks about historical themes with various mentions of violence. Finally, we try to share some practical advice throughout for both leaders and even for employees going through cultural change, and crowdsource questions from our audience as well that are answered at the end. You can read more about and order the book at a16z.com slash what you do. 100% of the proceeds will go to anti-recidivism, helping people get out of jail, stay out of jail, and towards making Haiti great again.
--:-- We're here to talk about Ben's best-selling new book, *What You Do Is Who You Are*, which is really about culture. And we all know it's important, but no one really tells you how to shape it, how to set it, even how to fix it when things go wrong. And what I love about Ben is he's not only a builder, but a bridger of cultures and that's why it's so significant that we're sitting here at the Computer History Museum because this represents the heart of Silicon Valley which itself has been going through lots of cultural change.
--:-- So the first question I want to ask you, Ben, is a very obvious, straightforward question: to actually define culture. Because you say it's not corporate values, it's not perks. But then what is it?
--:-- Ben Horowitz: One of my favorite semi-definitions of culture, or pieces of it, is from the Way of the Warrior, the Bushido, which is the ancient code of the samurai. They say a culture is not a set of beliefs, it's a set of actions. That's where the title of the book came from. So it's not what you believe, it's not what's in your heart, it's not what you tweet. It's what you do. That's who you are, culturally.
--:-- But when you get into a company context, it ends up being really small, subtle things that determine your culture. They determine the way you treat each other, the way you treat your business partners and your customers, and they're very amorphous, nearly invisible things. Do you return that phone call in an hour, in a day, in a week? Never. Do you go home at five or at eight? When you do a business deal, is it about the partnership or the price? All these things, that's your culture, and they're not in your KPIs or your OKRs or your mission statement or any of that.
--:-- And then how do you move and shape them? The conventional method, I can tell you, doesn't work. That method is: we'll bring in the HR consultants, we'll have an offsite, we'll put a bunch of values on the board, and then once a year in people's performance reviews, we'll say, "Does he have integrity? What are those values again?" The real thing is, how do you know if you return the phone call? You don't even know if you got the phone call. So how do you get that behavior going in the direction that you want it? That's what the book is about, and that was the hardest, most difficult thing for me to learn as CEO. So I thought it was a good thing to write a book about.
--:-- Sonal Choksi: Sitting in Computer History Museum, I think of the book as culture as code. You actually use a lot of words. I'll read some of them out loud. You describe culture as code. You talk about programming culture. You talk about reprogramming culture. You talk about how it's hard to debug, how every culture has bugs. You basically use a lot of digital words, but your examples are all analog. The most recent one was maybe 20 years ago, and it was from prison where there wasn't a lot of technology. And frankly, they go back over a thousand years. Specifically, the example that comes to mind is the samurai. What drew you to that example of culture as code and why?
--:-- Ben Horowitz: The first example is the Haitian Revolution, which is an amazing story because it's the only successful slave revolt in human history. It's a story of how Toussaint Louverture reprogrammed slave culture to be military culture, which is an incredibly difficult job for many reasons. But the tragedy of the Haitian Revolution is they lost the culture almost the instant they won the revolution. It was a crazy story about what happened to Toussaint. He was double-crossed by Napoleon and thrown in jail in a diplomatic meeting, and Jean-Jacques Dessalines took over and went in a completely different direction.
--:-- Sonal Choksi: Yeah, yeah, yeah.
--:-- Ben Horowitz: But the Samurai Code lasted at least 1,000 years, depending on how you count it. I really wanted to go through all the things they did to make it last so long, and amazingly so.
--:-- Sonal Choksi: With the Samurai Code lasting so long, it's another programming word: it was a system. I have to ask about this, because on one hand in the book you say you can't have platitudes, but it was a system of words. They had a code with eight principles. How do you reconcile that?
--:-- Ben Horowitz: You can describe your actions in words. I'm not anti-word. One of the things with culture that you run into is that things you think you want to put in your culture can get weaponized against you. They tell a story in the book about Slack. Stuart Butterfield early on had this cultural value: empathy. His intention was, "I don't want people to just state their point of view. I want them to understand the other person's point of view thoroughly and then decide if they still want to argue the point, as opposed to just going at each other." Well, it wasn't defined, you know, where the boundaries were. So what ended up happening is employees would be getting their performance reviews, and the manager would say, "I need you to improve here and there," and they'd say, "Well, you're in violation of the culture. You're not being empathetic." So he was like, "Okay, I got to get rid of that value. That's not going to work."
--:-- The samurai developed it over a very long time, but it's amazing how they had points and counterpoints where the virtues worked in a system that would govern itself. For example, they were an honor culture. If somebody dissed you or insulted you, they had to go. That insult could have been a diagnostic to say, "Is this guy weak? Can I besmirch his honor and get away with it? Because if I can do that, I can probably stab him in the head or rob him or whatever."
--:-- There's a really great story in the Hagakure about a samurai who has a flea on his shoulder. Another person says, "Excuse me, you have a flea on your shoulder," and the samurai cuts his head off. You go, "Wow, that was a pretty harsh response." They asked the samurai, "Why'd you cut his head off?" He said, "Look, I'm not an animal. I don't have fleas. Don't call me that."
--:-- When you have a virtue like that, you need something to balance it. One of the things they did was establish a very elaborate system of how they treated each other in this virtue known as politeness. Politeness means the best way to show someone love and respect. Respect is very, very important because you don't want to say they're an animal with a flea. It's everything to how you bow, to how you set up the tea ceremony, to every aspect of how you make somebody maximally comfortable so that they feel how you feel about them.
--:-- But if that was fake just so you didn't get your head chopped off, then that really wouldn't be good either. So one of the things in the code is politeness without veracity is empty. It has to be honest. It has to come from the right place. It has to be true. These are the ways they created a system that built a much stronger and longer-lasting culture.
--:-- Sonal Choksi: That is honestly my favorite example from the book because you describe this interlocking system of eight values in the Bushido code. Virtue is what you do. You are trying to rebrand the word values into virtues.
--:-- Ben Horowitz: It's not so much a rebranding, it's a different thing. A value is what you believe, what you want to be, what you aspire to. A virtue is what you do. From a chief executive perspective in a company, you want to think through not just what you want, but how you're going to get it. When people talk about culture, they just go, "Here's what I want, and then I'll just tell people it in all hands, and then I'll get it." That never happens. Then you know what your culture is? Hypocrisy, because I have all these values on the wall and I don't do any of them. It's trying to move the mindset into how do you do it? What are the mechanisms? What are the mechanics?
--:-- Sonal Choksi: What do you think the power of storytelling is then in disseminating and sharing that culture? In fact, one of the lines in your book is that stories and sayings define cultures. I have to ask what the difference is between the story and those sort of hypocritical value statements on a wall. What power does story have?
--:-- Ben Horowitz: I'll give you an example. Let's stay with the samurai for now. One really powerful cultural virtue is loyalty. There's a question: how do you show its importance? How do you make that stick? One way, either in a company or in an ancient Japanese warrior society, is through a story that's so compelling that people literally can't get it out of their head. Here's a story I'm going to tell you that you won't be able to get out of your head.
--:-- Sonal Choksi: Oh no.
--:-- Ben Horowitz: There was this lord in ancient Japan. His name is Lord Soma. In those days, the status symbols weren't what we have today, but one of the things that everybody was proud of if they had a good one was their genealogy. It was on scrolls, written out, generations of who your ancestors were. The more you knew who you were, that was a big thing. Lord Soma had the best genealogy in all of Japan. It had a name: the Chaiken Marikoshi.
--:-- Working for him was a samurai who was a mediocre guy, clumsy, always getting things wrong, messing things up, but he was always sincere and loyal. One day, Soma's house catches fire. It is engulfed in flames. It is burning down and there's no way to deal with it or put it out. Inside the house was the Chaiken Marikoshi, his genealogy. The samurai runs into the house engulfed in flames. Lord Soma is shocked. He's horrified. They watch the house just burn to the ground, and they know he's dead.
--:-- They go in, and sure enough, they're looking for him. He's face down, and it's horrible. But then they notice that he's in a pool of blood. They're going, "Why is he in a pool of blood? He just ran into a fire." They turn him over, and there's a slit in his stomach. They open the slit, and inside it is the genealogy. He cut himself open, put the genealogy in, and saved it. It was known from that day as the Blood Genealogy. Everybody knew that even if you were mediocre, if you had that kind of loyalty, you could be great.
--:-- That was the story. No one's going to forget it.
--:-- Sonal Choksi: I am sure everyone in this room is wondering, quite honestly, why are all your stories so far so violent? I'm wondering that right now, too.
--:-- Ben Horowitz: I think I can only answer that with another violent story. Some of them I got before I was actually writing the book. It's just me and Shaka in the backyard, and I'm barbecuing, and he tells me these stories, and I'm like, "Wow." When you hear it, just think that's how I heard it.
--:-- Shaka, who's in the book, went to jail for a murder he did commit. He was in jail 19 years, seven years in solitary confinement. This story is about his first day in jail, in prison. Him and a group of guys are in quarantine, which is where they keep you until they put you in general population. They come out into general population, very first day. They're in the recreational area, and a prisoner walks up to another prisoner and stabs him in the neck with a shank, pulls the shank out, the prisoner bleeds to death, dies. The other prisoner throws the shank in the trash and walks into the cafeteria and has a sandwich.
--:-- Shaka said, "All the prisoners are looking like, where in the hell are we at? I had to ask myself, could I do that?" And I said, "Wait a minute, you murdered a guy to get in here. You did do that." He said, "Oh no, Ben. I didn't do that. I was dealing drugs. One of my customers came. He was supposed to come by himself. He brought another guy. The other guy's in the back seat of the car. I'm already traumatized because I had been shot like 18 months earlier. This guy in the back of the car is supposed to stay in the back of the car. He opens the door. He comes out. He comes at me real aggressive. I react. I had a gun in my pocket. I shot him. That's what I did."
--:-- He said, "This guy spent two weeks taking a two-liter bottle and filing it into a shank. Then he decided, am I going to stab this guy in the stomach and wound him, or am I going to stab him in the neck and kill him? I couldn't do that. But I had to ask myself, could I do that? Because that's what it took to survive here."
--:-- That is new employee orientation. That is getting indoctrinated.
--:-- Ben Horowitz: I'm about to explain to you why the book is so violent. That is how you get oriented into such a violent culture, with an experience like that.
--:-- People join a company. First thing they do, first thing all of you did when you joined a company: who's successful here? Who's the person everybody looks up to? What's their behavior like? "Oh, that guy's making all the money, he's got the big job, he's the golden boy. Oh, and he just took credit for her work. That's what I have to do to succeed here." That's cultural orientation. That's way higher impact than the value statement.
--:-- I have conversations with CEOs all the time. I'm like, "Look, you have to take onboarding seriously. You have to take new employee orientation seriously. You have to train your managers and your people on what's expected of them behavior-wise in the culture from day one." They don't listen to me. So I needed a real story that they would remember and understand that would get them to do the right thing.
--:-- Culture feels very invisible. You're like, "Why do I have to do that? I see that person doing something wrong, but it's not that wrong. I don't want to hurt their feelings by calling them on it." But you're not looking at the knock-on consequences, the knock-on cultural consequences that you're setting up by not addressing it.
--:-- A lot of what the book is about is, can you recognize culture? A lot of the examples in the book are things that people are not familiar with. The reason for that is nobody can see their own culture. "That's just my way of doing things. That's my culture. That's my behavior." Maybe it's not, but you can't see it because it's you. But you can see prison culture. You can see slave revolt culture. It's something to borrow from and think about and riff on in your own way.
--:-- Sonal Choksi: I want to let people know that Shaka is actually a wonderfully kind, empathetic person.
--:-- Ben Horowitz: No, he's amazing.
--:-- Sonal Choksi: One of the great stories in the book is how he transformed not only his own culture from that super violent culture, but also the culture of the Melanics, which was a gang he ran. A lot of his guys got out, and it's an amazing transformation that somebody could do that. I want to ask you about that. I know Shaka because he's a friend of yours. Just a plug for this, Ben and Shaka co-host a podcast series called *Hustle in Tech*, which is guides to technology for everyone. You can find that on our website.
--:-- What's really amazing is that in the book, the story was about how he took a group of outcasts and built a more cohesive team. That's how you described it in the book. For me, I wondered, coming at it from this theme of the vantage point of Silicon Valley, I understand what you're saying about using examples that are shocking and strong that you can learn from. But part of me was like, why is there a jail example in a book about business culture? Then I wondered, can we draw an analogy between a group of outcasts like technologists in this room and they can do the same thing? Can we draw lessons from that, or is that too far a stretch?
--:-- Ben Horowitz: Let me tell you where the analogy doesn't work. People in Silicon Valley, some people may be outcasts. They may have not fit in as a kid and spent more time with the computer or what have you. People get to prison very often because they're really severely abused as kids. The thing about prison culture that I thought was very instructive was that we can take culture for granted here. When you hire someone, you can expect certain things. You can expect them to be reasonably on time for their interview. You can expect them to be literate. There's a lot of cultural things that you can take for granted, more functional things.
--:-- In prison, there's really nothing you can take for granted, including things like literacy. When you go through the way Shaka built the culture of the Melanics, he really had to start from first principles. Sometimes in a culture in a company, you've got to do that same thing.
--:-- One of the things Shaka did to create loyalty was he had the guys spend a lot of time together, eating together, working out together. It was required to be a member. That proximity and the nature of how they did it built the culture.
--:-- One of my portfolio companies, NationBuilder, and the CEO, Leah Endress, calls me up one day. She's like, "Ben, our cash collections are always late and not 100%." I said, "Well, you have big customer satisfaction issues." She's like, "No, no, no, we're just not collecting the money. I tell them we need to collect the money and it never happens, and I don't get it." I was like, "You have to start from first principles."
--:-- I took her through what Shaka did. I said, "This is how we're going to apply it here. I want you to hold a meeting every day with the cash collections team. Every day, eight in the morning, everybody comes to work like we're having a meeting. In that meeting, the very first thing that I want you to say is, 'Where's my money?' What you're going to find out is they're going to have all kinds of weird reasons why they can't get you your money. They're all going to be very easy to fix because it's a cultural problem, not an actual problem."
--:-- Sure enough, she calls me up after the first day. She's like, "You're not going to believe it. You know what one of the biggest things is? We have an email that we send to collect the cash, an auto email, that's really poorly written." It's not a big company. She every day has this meeting and works through it. Pretty soon they were collecting literally twice as much cash as they had been previously. It was just a culture change, but it was a culture change taken from a prison example. Because you can't make cultural assumptions when you're in prison. Often CEOs make cultural assumptions they shouldn't.
--:-- Sonal Choksi: I love that you brought up first principles because I'm fascinated by first principles type thinkers. I think some of the greatest CEOs, scientists, innovators are first principles thinkers. One thing I often wonder when I observe the evolution of technology and innovation is, are there maybe two camps of people: people who can be first principles thinkers and some who can't?
--:-- The Silicon Valley folklore story of Reed Hastings, CEO of Netflix, you tell this briefly in the book. He wanted to pivot the Netflix business from DVD to streaming. He would say he didn't want to pivot it. He said the plan was always to be a network. He wanted to evolve the network, in his view, from the outset to a streaming service. I shouldn't use the word pivot because that's even more powerful, frankly, from a first principles perspective. He had the vision up front and the confidence to know that he was going to pace himself by doing the DVD business before he did the streaming business. But then he built a successful DVD business, and then he kicked out the leaders of his DVD business from the room when they were talking about the streaming business, which felt like a very bold first principles move.
--:-- It's Silicon Valley folklore. You tell the story in your book. I read that, and I was like, would you really advise your CEOs to do that? Was there something about him uniquely that he could make such a bold move? Or is this really advice that people in this room should actually go translate into their work?
--:-- Ben Horowitz: It was actually analogous to the move that Toussaint Louverture made in the Haitian Slave Revolt. The leader of the only successful slave revolt in human history was obsessed with culture. One of the things he wanted to move from was a broken slave culture to a world-class military. Not only military, but societal culture. He thought Haiti could be a first-class country.
--:-- One of the decisions he made to make that priority clear, because the default culture in a slave revolt is a revenge culture, was what to do with the plantation owners, the slave owners. He could have executed them. He could have seized the land. He could have done a lot of things. He actually left them in place, let them keep the plantations, but said he had to pay the workers as opposed to have them as slaves. To facilitate that, he lowered their taxes. That was a decision to set the culture away from revenge and towards reconciliation, caring about the economy, and caring about the go forward.
--:-- Reed wanted to get to streaming. His big fear was that a pure streaming company would come along and he would be stuck in the DVD business. He couldn't figure out how to change the culture to do that. Then one day he said, "Even though the DVD business is 100% of the revenue, imagine that, 100% of the revenue, I'm going to let everybody know that streaming's more important." The way he did it is he kicked all the DVD people out of the executive staff meeting. Anybody who knows about companies knows that's a meeting everybody wants to be in, that executive staff meeting. That's going to really hurt feelings.
--:-- But it wasn't like Reed was so great that he got to do it and people would be okay with it. He was just willing to take that because the principle was so important. The same way people were mad in the Haitian Revolution when Toussaint did that, but they were working towards a higher cultural principle.
--:-- Sonal Choksi: You described it as creating a shocking rule that does that kind of a reset. One recurring theme I noticed in the book, and for those who haven't read it, this is just something people in marketing and brand talk about too, which is the power of the why. I noticed almost every other chapter, every other sentence, every other paragraph, you kept emphasizing this message: the why matters more than the what. The why matters, the why matters. It seems obvious on the surface, but I really want you to share with us why the why is so important.
--:-- Ben Horowitz: I'll give you two very different examples. One is from a16z. One of the things we wanted in the culture from the outset was to respect the entrepreneur and the entrepreneurial process. There's not a venture capitalist in the world who won't say that, but there's a big cultural force that screws that up in venture capital. This dynamic: I have the money. You want the money. To get the money, you've got to come see me and ask for the money. Then I get to decide whether you get the money. That could make a person disrespectful.
--:-- I'll tell you what it does. Anybody here raised venture capital money? How often did the VC show up on time for that meeting?
--:-- Ben Horowitz: No one's raising their hand. Why is that? They say it, but they don't believe it. They aspire to it, but it's a value, not a virtue.
--:-- I set a rule early on: if you're late to a meeting with an entrepreneur, you owe me $10 a minute. Oh, you have to go to the bathroom? No problem, $50. Oh, you had a really important phone call on the deal we all wanted to close? No problem, $100. People would come to me and go, "Why? Why am I paying you to work here?" I'm like, "Look, because I need you to know how important and valuable an entrepreneur's time is when they're trying to build a company. You're not going to waste any of their time if you're here. You've got a plan when you go to the bathroom. You've got a plan when you have that phone call. I know you can do it because if you were getting married, you wouldn't be five minutes late to the altar. You would have gone to the bathroom already."
--:-- Every time somebody has a plan when they use the restroom, when they make their phone calls, which is every day at the office, they have to say, "Why am I doing this? Oh, I remember why. Because we respect entrepreneurs and what it means to build a company." That's a technique to move the culture.
--:-- Sonal Choksi: I should tell everyone in the room, since you gave that a16z example, they actually formally call those breaks "bio breaks." They actually schedule in bathroom breaks into the schedule. But anyway, onto your other example.
--:-- Ben Horowitz: A different one. Ethics turns out to be really tricky in a company. People make fun of Dara at Uber for saying, "We're going to be ethical. Our new corporate values: just do the right thing, period." It's like, what the hell is the right thing? It actually turns out to be fairly subtle much of the time.
--:-- In a company, you could imagine: we made promises to all the employees about what their stock was going to be worth, and to Wall Street about the numbers we were going to hit. We live up to our commitments. To make the number, we got to get this deal. To get this deal, they need this feature, but they need it in a quarter and we're not going to deliver for a year. Is it ethical to whiff the quarter and have lied to all the investors and the employees? Or is it ethical to stretch the truth to the customer and get the money?
--:-- Ben Horowitz: Well, you better be clear on that, and you better get to some kind of higher principle than "do the right thing."
--:-- A great example of this is in the Haitian Revolution. This is a war over sugar. It's the British Army, the Spanish Army, the French Army, and the slave army all fighting for control of this colony. It is the most mercenary kind of endeavor that you could ever imagine. All of the European armies are letting their guys pillage all they want.
--:-- Toussaint makes the decision that he's going to not allow any pillaging in the slave army because you can't fight for liberty if you're taking people's liberty. It was an amazingly powerful thing. The story would be of the Spanish army going in, setting the plantation on fire, killing all the animals, robbing everybody, raping the women on the plantation, and then the slave army would show up starving, and they would not touch the thing. No violence, no pillaging, no nothing.
--:-- The knock-on effect of that ethic was that Toussaint had the support of the locals, including the white women in the colony who referred to him as father, amazingly to that level of loyalty. He didn't say "do the right thing" because the right thing is pillage. You pillage, the guys get paid, they fight harder, they win the war, you end slavery. That seems like pretty legit. So you can't just say "do the right thing." You have to say, "Here's what we're doing and here's why we're doing it." That's why I emphasize the why. The power of the why.
--:-- Sonal Choksi: I have two follow-ups on this. I want to shift gears to more practical techniques based on these wonderful principles and violent stories as well.
--:-- In the Dara example and the values and why the why matters, I also read it and heard it a little bit as maybe mistakes of omission are more important than mistakes of commission. That what you don't say is more important than what you do say. Practically, does that mean as someone in this room who wants to write their code, their Bushido for their company, do they start with what they're not? Or is there room for them to figure out what they are? How does that play out practically?
--:-- Ben Horowitz: The universe of what you're not is too big.
--:-- But here's the thing that is true in every culture, and this is the thing that Toussaint did so effectively. You have to make ethics explicit. If it's, "Oh yeah, we're going to do the right thing," or "Don't be evil," that's just not good enough.
--:-- A great example of this is Uber under Travis. Travis will get criticized for building a bad culture, but he actually had the best-defined culture in Silicon Valley. If you read the original values he had — always be hustling, super pumped, toe stomping — they were all really creative, well-crafted, energizing principles that they worked on. But he went way beyond that. They really trained people on them. They had Uber University, and they trained people on the culture. It really stuck.
--:-- Probably the most powerful virtue that defined the company was competitiveness. They were massively competitive and really great at that. But what he did not do is he didn't say where the line was. Ethics were just unstated completely. A lot of people would interpret that competitive virtue to be "whatever at all costs," even "hashtag winning."
--:-- When Susan Fowler joined the company, she gets sexually harassed her first day on the job by her manager in writing. She snapshots it, sends it to HR. Anybody who knows anything about HR law knows if you get any kind of complaint, let alone one in writing with proof, you have to investigate it. That's the law. But this HR person said, "Oh, that manager's a high performer, so we can move you, but we're not doing anything."
--:-- There's no way Travis wanted that manager to do that. It's a dumbass thing to do. Even if you didn't care about sexual harassment, that's idiotic. But when you don't counterbalance the culture, if you don't say what the ethical line is — what we won't cross — particularly in business, because every conversation you have is, "How do we make the number? How do we get better? How do we get more customers?" If you don't have any countermeasure on that that you talk about out loud, then it can run away from you very hard and very fast.
--:-- That's why when you talk about what not to do, it's really about where is the ethical line in this company. In Uber's case it was tricky because they were flirting with the law on a lot of things, so the law wasn't even the line. They're challenging the regulation, the laws of the land. So what is the line? Definitely not something that every employee would just figure out on their own.
--:-- Sonal Choksi: I loved that. One of the things that I think is a through line through the book is this idea that the very strength you have is also your weakness, and it's all a difference of degree, not a difference of kind. There's a fuzzy area between the yellow and the red, so it's kind of on a continuum.
--:-- I have one question for you about the Uber example. I love a comeback story and the idea that you can change. Do you think that Travis himself could have led that change at Uber, or did they need to bring in an outside person? Could he have come back like 10 years later, like Steve Jobs at Apple on his second time? Can the same person actually make that change of a culture, or does it have to come from the outside?
--:-- Ben Horowitz: I think that Travis could have done it, but Travis would have had to change. When Shaka changed the prison culture, and I go through it in the book, it couldn't change until he changed. I think that with Travis, he may have changed now, but he didn't change then. I don't think he ever saw the lack of explicit ethics as the problem. Getting the medical records from the woman in India, the sexual harassment, the hell application where they hacked the lifter — all of those things were individual incidents. They weren't systematic in his mind.
--:-- Unless you believe it's systematic. I go through the story in the book where they have a confrontation with the Nation of Islam where Shaka realized that the violence was systematic. That's when he changed, and that's when they changed. He turned his whole group, the gang of the Melanics, around. That's very unusual and difficult to do.
--:-- There are other things where there's a competency issue. There's a lot of Boeing in the news lately on the 737. Anybody who's been in a company knows that there were people in Boeing that knew that thing wasn't safe. There were engineers that knew it wasn't safe. It's come out that they even told the CEO it wasn't safe. But somewhere in the culture, whatever it was, being on time with the product release or earnings became more important than safety. In a place where lives are on the line, you probably can't have a leader that lets that stand culturally. In that case, you have to remove them because you have to shock the system hard enough to reset the culture, to the point where they value safety over whatever it was that they were valuing.
--:-- Sonal Choksi: If he or someone else in this position who's trying to turn around or reset their culture did actually become self-aware, what would they have to do to then communicate that to their company? How do they convey that this is a shift?
--:-- Ben Horowitz: It's very, very hard and detailed work. I don't make light of it. Probably the best example is Shaka in the book. I hate to say "read the book," but that one's complicated.
--:-- Sonal Choksi: I actually do want to tell people to read the book because I think no matter how much we talk about it here, it doesn't do justice to the nuance and the layers of meaning within meaning within meaning. You can almost only convey that in the written form in some ways.
--:-- But one thing about this idea that you have to be self-aware, have truths that you know — I also wonder if it's at odds with the Silicon Valley technologist culture of reality distortion fields, to use the phrase that Walter Isaacson used to describe Steve Jobs. We work in venture capital. We see founders every day. There's a certain will to power that you need to punch through an industry that is hard to penetrate. You kind of have to have some lies that you tell yourself. For me, it felt like a bit of a contradiction between lies and truth and being self-aware. How can you be a founder and also self-aware at the same time? It feels like they're at odds.
--:-- Ben Horowitz: When you talk about a reality distortion field or a founder who has a crazy idea, that's innovation. On those ideas, what you're really saying is 99.999% of the world believes X and the founder believes Y. But when it's really a breakthrough, the founder is actually right. These people were all deceived or thought they knew the truth, but didn't. The founder did. That's always what innovation looks like.
--:-- But that's believing something, not knowing it. That's different than lying, where you know something and then you say something else to try and move things. That's why I hate the term "fake it till you make it," because that's "lie to get what you want." That has all kinds of bad cultural implications that will come back and eat you alive in your own company. I think those are two different concepts. I don't think you have to reconcile them.
--:-- Sonal Choksi: Some quick lightning round style questions. One is superstars, 10x engineers, brilliant jerks, other outliers in a company. When is cultural cohesion more important than those types of special, unique individuals and their performance? Is there a tension between the two?
--:-- Ben Horowitz: Almost all the time. John Madden had a great line on this. He said on a football team, there's one guy that you can hold the bus for. Everybody's got to be on time, but that person is so great that we're going to hold the bus. The reason it can only be one is you have to make it clear to everybody else that you're going to let that person be outside the culture. But you have to have great skill, like John Madden was an amazing football coach. Generally, you wouldn't do it, but if you want to do it, they better be the one.
--:-- Sonal Choksi: Pirates versus Navy. You've talked a lot in your other writings about wartime versus peacetime CEOs. I love that because it comes from The Godfather. By the way, I'm a big fan of Godfather 1, not Godfather 2, and there's two camps on that.
--:-- Ben Horowitz: Godfather 2 is good. It's not great. It's not as good as Godfather 1. And Godfather 3, let's not even talk about.
--:-- Sonal Choksi: Because you're an editor, Godfather 1, the editing was way tighter.
--:-- Ben Horowitz: I agree with that.
--:-- Sonal Choksi: I'm glad we agree on that. But Pirates versus Navy — is there a phase when every startup inevitably starts off as pirates and becomes a navy? How does someone navigate that cultural transition?
--:-- Ben Horowitz: There's a great story in Andy Grove's book, *Only the Paranoid Survive*, about this. When they had the floating point error, Andy Grove was like, "It's not going to affect anybody. These guys are all stupid. F off." Because Andy didn't suffer fools. But it was a huge catastrophe for Intel. What he said he learned, and it was this transition from pirates to the Navy, is when you're dealing with consumers, how they feel matters. These things matter more than the actual technical answer. He had to make that transition.
--:-- Sonal Choksi: I'm going to ask some of the questions that came from the audience. The first question is, Ben, given the importance of culture in any organization, how would you evaluate candidates for culture fit?
--:-- Ben Horowitz: That's very tricky because people can change their culture. One thing you can get with exact culture fit is a lot of homogeneity. We went to the same school. We read the same books. We believed the same things. There's a power in that, but it's a slippery thing, so you have to be careful.
--:-- What I find to be powerful is to really define your culture. We have a very comprehensive culture document at the firm. We have a values document. One of the things we do, which I learned while writing the book, is we don't let anybody sign their offer letter without agreeing to the culture, saying, "I'm going to live in this culture. I'm going to adhere to these standards."
--:-- If somebody says they're not a culture fit, it's like, "Why? What exactly about them doesn't fit into our culture? Is that an element we want in our culture or not want?" You have to be able to have the conversation at that level. Doing it in a fuzzy way is very dangerous. Doing it in a specific, intentional way and knowing that people can change would be the correct approach.
--:-- Sonal Choksi: This is a follow-up related question from another person. You talked about building culture. What do you do if you walk into a new company and find yourself a misfit in terms of culture? From the employee perspective.
--:-- Ben Horowitz: If you don't believe in the behaviors of that company and you're coming in at the individual contributor level, you probably want to move on. It's very difficult because what will end up happening is that culture will change you. I know a lot of you have probably worked in organizations where people berate each other. Then what happens? If you're in that, you'll go home and do that. You'll pick that up. Don't do that to yourself. Don't become a person you don't want to be.
--:-- Sonal Choksi: I would also add to that, because I've heard this from you so many times and it's in our values too, that we celebrate difference. The assumption should not be that someone following a code means that everyone's in the same cult mindset. There's room for a variety of people and different ways of being.
--:-- Ben Horowitz: When we talk about the firm, if you have an NFL team, you're going to have players that weigh 350 pounds and players that weigh 180 pounds and run fast. If you have all 350-pound players, you're going to lose. If you have all skinny guys who run fast, you're going to lose. We have to value each other's strengths. It can't always be that I only value the strengths that I have. That's where people screw up the whole diversity inclusion equation — they can't see the talents that they don't have. They try and use a proxy like race or gender. If you could see the talent, you would get diversity. You just have to be able to see what people can do. I talk about this a lot in the book. You have to see and value the things that you can't do.
--:-- Sonal Choksi: This is also related. What can I do to change a culture at my company as a rank and file employee? Do they go to HR? Do they talk to someone? What advice would you have?
--:-- Ben Horowitz: To change the culture... The thing that's different in companies versus a society — in society, Jay-Z can change the culture. In companies, the hierarchy has a heavier weighting. If you wanted to change the culture so that everybody was on time and respectful of each other's time, but the CEO always showed up to everything a half hour late, it would be really hard to do. If you're an individual coming in, you kind of have to compel the top of the organization to do it for starters. Otherwise, you're just going to be fighting the tide.
--:-- Sonal Choksi: I appreciate that you're someone that I can walk into your office and tell you the truth of what I'm thinking and you don't get mad at me for that.
--:-- Ben Horowitz: As a leader, everybody's culture is broken in some way. I've never met a company that has anything close to 100% cultural coherence. People who tell you they have it are lying to themselves. They're full of shit. In mathematical terms, it's a complex adaptive path-dependent system. Everybody's behavior is moving the culture all the time. You're going to have breakage, slippage, and regressions. As a leader, if somebody says, "I think we have a cultural problem," you can't tell them to pound sand. If you do, that thing is going to fester and grow. We call that a kimchi problem.
--:-- Sonal Choksi: That's great. For my Korean friends. You say in the book, the goal is to be better, not perfect, which is a much more attainable thing. Here's another employee-oriented question. How can I evaluate company culture before I join? How can you tell from the outside if you don't have a culture doc?
--:-- Ben Horowitz: You have to ask specific questions about the behaviors that you're concerned about. If you ask about a behavior, people won't know to try and head fake you on it. If I send somebody an email here, how long will it take to get back to me? That's a very telling thing in a culture. People are either responsive or they're not. If I go to a meeting, are people going to be listening to me or are they going to be on their phones and computers? Different companies run differently that way. You have to think about where you're going to be effective, what behaviors you want to be part of, and what is going to drive you bananas.
--:-- Sonal Choksi: Oh my God, I love this question. In the blood genealogy story, you mentioned the samurai was a mediocre performer. How do you decide whether or not to keep that mediocre performer without him having to demonstrate value in such an extreme way in an extreme situation?
--:-- Ben Horowitz: That's a great question. In the story, Lord Selma really had an affinity for the samurai despite all his issues. One of the things I really believe in is you value people on the magnitude of their strength, not their lack of weakness. That's in hiring and as you go forward. The late Raiders owner used to say something I really like: "Coach them on what they can do." Not everybody can do everything, but if what they can do is world class and you need that, then that's a real thing. He would do his level best at whatever you needed him to do 100%. That shows up more than just when he went and got the genealogy. It's how you look at people.
--:-- I would always rather have somebody world-class at something that I really needed than above average at everything and horrible at something else. We have people in the firm like that, as you know. I value that. You do have to have that conversation: "No, you can't go do that job because you're no good at that."
--:-- Sonal Choksi: I love that about our firm. I love that we're all really honest about that and we allow that. Because we talked about Godfather earlier, I have to say that I call this my capo theory of management. There's a capo layer in every company. I sometimes wonder if that kind of loyalty actually pays off. With that question, it almost made me wonder, "I don't want to be that blood genealogy person. I'd rather be excellent at something than mediocre and have to prove myself that way." But not everyone.
--:-- Ben Horowitz: That was a real test.
--:-- Sonal Choksi: This is a great one. As an investor and board member, this is kind of a governance-related thing. How do you keep your company management responsible on the question of culture? Is it something you actually ask? Is it around processes, KPIs, priority versus profit? Does it come up at a board level?
--:-- Ben Horowitz: It does for me because I spend a lot of time with the CEOs in my portfolio talking to them. It starts with hiring. I don't care about your close rate on your candidates right now. What I want to know is how are you onboarding them? How long does it take them to get productive? What is your employee satisfaction? What are your attrition rates?
--:-- This is the biggest mistake people make on diversity. They measure how many women and underrepresented minorities are coming through the door. That's not the metric. The metric is what do promotion, attrition, and pay satisfaction look like across race and gender? Can you see the talent? Do you value it? Do people enjoy their career there? If they do, then you can get the talent. But if you don't recognize the talent and you just force people in so you can get the gold sticker that says you're not racist and sexist, then you're going to make everybody miserable.
--:-- Sonal Choksi: A couple more and then we can wrap up. If you could be world class at only one thing — culture or product — which do you choose and why? For those in the audience who haven't read the book, one of the recurring themes Ben talks about is this tension that culture is this abstract thing. How do you make those choices?
--:-- Ben Horowitz: Let's not get confused about one thing. You can have a great culture and build a product that people don't want. Your company is going out of business. The product has to work for you to have a business.
--:-- But having said that, I talk to entrepreneurs about this all the time. The most important thing about your company isn't necessarily going to be the success or the deals you won or the customers you had. It's going to be what that time was like. That time of your life and the life of all the employees who spent most of their waking hours with you at your company. What did that feel like? How did you treat each other? How did you treat the people you work with? Did everybody's lives get better? Did they become better people or worse people? That's your culture. That's a real thing with incredible value. Just because you can't succeed through culture alone doesn't mean it's not incredibly important.
--:-- Sonal Choksi: Last one. If starting a VC fund like a16z today, what would be the most important thing to build the right culture?
--:-- Ben Horowitz: It depends on what your business strategy is. Not every culture is for everybody. One of my favorite examples in the book is Amazon. One of their cultural things is frugality. They used to have your desk be a door in the old days at Amazon. A trestle table. "We're not going to buy you a desk. That's how cheap we are." Their business strategy was to be the low-cost leader. From a customer perspective, if I went to Amazon, I didn't even have to price compare because I knew they had the lowest cost. To get to that, you need to not waste money.
--:-- You contrast that with Apple. Apple doesn't have that strategy. They're not trying to be the low-cost, low-price leader. They're trying to build the best product possible, the most beautiful, best-designed, spare no expense. Steve Jobs even got fired by sparing no expense his first time around. You go to their campus, it costs $5 billion, it's gorgeous, the doorknobs cost thousands of dollars. That works for them. That culture produced the products that they produced. Apple's products will probably always be more beautiful than Amazon's products, which are not very beautiful. But they'll also always be more expensive. That culture was right for Apple, and the other culture was right for Amazon. For Apple to take Amazon's culture wouldn't have been productive for them because it didn't go with their business strategy.
--:-- Sonal Choksi: That's great. I have one question that the Computer History Museum asked us to do as well. You made the bestseller list in the category for advice and how-to, which I personally love. I found the book very therapeutic in reading it. There's something about personal development as well as career development and leadership in it.
--:-- On that note, for you, sitting where you are today, knowing everything you know now and what you could tell your younger self, the Computer History Museum has a one-word initiative where they ask you to reveal one word of advice to a young person. It could be for yourself or to any young person today. Could you share what your word is and the story behind it?
--:-- Ben Horowitz: [Holds up a card] It's persistence. This is for entrepreneurs. Entrepreneurship makes you want to quit all the time, from fundraising to everything going wrong to problems with customers to your employees telling you your culture sucks. If you're not absolutely committed to getting better and learning and changing and making it go, then you're not going to get there. If you think about the top entrepreneurs, they are amazingly persistent people. This is something that if you want anything in life, this is what you need.
--:-- Sonal Choksi: One last question I want to ask you about the process of writing the book. As an editor, I have to know. Frankly, before I met you and came to Andreessen Horowitz almost six years ago, I thought it was kind of sticky and gimmicky that you would put rap lyrics at the top of your blog post. I'm just going to say this out loud. I'd be like, "Who is this white guy putting rap lyrics on his post?"
--:-- Ben Horowitz: Judge me by my culture, not my color.
--:-- Sonal Choksi: I agree. But I had that thought in my mind. You also say in the book that the majority of your entrepreneurial and business and culture ideas occur to you when you're listening to hip-hop. Now that I know you and I know that there's layers and layers and meanings behind what you do, what specifically about hip-hop culture draws you, and what's the bigger cultural context for the rap lyrics that you put at the top of your blog posts?
--:-- Sonal Choksi: Yeah, so rap music is very entrepreneurial in nature. The original rap music, because they created a new musical art form out of nothing, and nobody would put it on the radio. MTV wouldn't play the videos. Nobody would sign the guys for the first 10 years of rap music. And so they did all these things. They sold records out of the trucks of their cars, that kind of thing. They built this whole thing that ended up being the biggest musical art form in the world currently. And they tell those stories in the songs, and they're very related to the entrepreneurial journey.
--:-- So I have a lot of those things in it. And then, of course, now I listen to so much rap music, a lot of other things come to mind. If you think about the opening quote for the Culture and Revolution chapter, it's from Nas, who I spent hours and hours talking about the Haitian Revolution with. He had a song on his album, *Stillmatic*, the introduction to the album. You have to understand, his career — they had buried him. He was dead. And Jay-Z came out with this very aggressive dis rap against him, which he countered with a song called "Ether." But the opening line is "blood of a slave, heart of a king." And I was like, that's Toussaint L'Ouverture: blood of a slave, heart of a king.
--:-- So those kinds of things — it's kind of telling the hidden story in the book. The rap lyric in the Shaka chapter from a young woman, Dej Loaf, really describes the culture he came from well, but she's also from Detroit. So it's just kind of the backstory on the book. It's how I tell that for the really avid readers.
--:-- But one of the things I've learned from you, and I agree, it's about judging a person based on their culture, not on their color, is that the influence of hip-hop is outsized in our culture. We did an event with Dapper Dan, and that was a great example of how a man from Harlem, his design has influenced many, many other great designers. There's a riffing culture, but sometimes it's also a borrowing culture, a remix culture — that's TikTok. So I think what I love about it is that hip-hop has had an outsized cultural influence in our world today, and it's very powerful because you constantly bridge these cultures for us, too.
--:-- Ben Horowitz: So I want to go back to culture, not color, because that actually comes from something that Toussaint did. In 1797, he was actually running the colony as part of France. There was a guy, Vincent Vaublanck, who hated the idea of a slave running a French colony. He lobbied the French parliament. He said, "Look, the colony's been overrun by ignorant and brutish Negroes." And Toussaint had to counter this argument. The countered argument was really interesting because he said, "Look, black people are not savages. It's slavery that makes them so."
--:-- Then he went on to basically break down point by point why the Haitian Revolution was far less bloody and brutal and savage than the French Revolution. Some of the things I talked about — like they didn't pillage — made his case, and he won that argument with the French Parliament. But it was so interesting to me the way he phrased it, because it was the culture of slavery that created the perception of these guys that had nothing to do with it. It just got a color assigned to it.
--:-- I think that with hip hop, it's the culture of entrepreneurship. And it has nothing to do with being black. It has to do with that culture. That's why I think a lot of entrepreneurs resonate with it. We get divided up into these dumb demographics — age, gender, color, zip code. But what you do is who you are. That's your culture.
--:-- Sonal Choksi: That's fantastic. I want to say to everyone, thank you for joining this episode of the a16z podcast. We're here at the Computer History Museum. Thank you everyone for coming today and joining us. Thank you.
