Sam and Shaan do a candid retrospective on how they actually run their companies, covering the dumb stuff they did early on versus what actually works now. Topics include mission statements, branding, hiring, reference checks, goal-setting frameworks, firing, and saying no — with honest stories about the embarrassing mistakes behind each lesson.
Speakers: Sam Parr (host), Shaan Puri (host)
Introduction: The “Dumb Stuff We Did” Episode [00:00:00]
Shaan: All right, today we thought it’d be fun to do an episode all about how we actually run our companies. We’ve been running companies for like, I don’t know, 10–15 years now, and like many people out there, at the beginning we did a bunch of dumb stuff. So we’re going to admit and confess to some of the dumbest things that we did running our companies, and then talk about what we do now that we’ve found actually works.
Shaan: The stuff that didn’t work and the stuff that works — and this is around everything from mission statements, how we used to think those were super important and how we treated them versus what we do now, or branding and naming our companies, or goal setting. These are kind of like the shortcuts we use now. What we found works through the painful process of making embarrassing mistakes — that’s what I think we’re going to do today.
Sam: Yeah, we got about five or eight categories — on hiring, on creating comp plans, on having boundaries with staff. These actually sound boring when I’m just reading them off, but I promise you it’s actually interesting. We have stories behind each one, and stuff we wish we would have done earlier that I deeply regret not doing. We’ll go through all the stuff that we actually use day-to-day to run our companies — the touchy-feely stuff that’s actually really important.
Shaan: I thought it’d be fun for us to share what we do when we run our companies. What are our almost like management hacks, or shortcuts, or the methods we use — which, as a disclaimer, are probably not the best. Probably not what they teach you at Harvard Business School or what very polished, seasoned executives would do.
Mission Statements: Drop the Grandiosity [00:01:45]
Sam: I remember when I started one of my early companies, my internal mission statement was to hire 10,000 people. Then I hired like two people and I was like — hey, does this thing have a new laser?
Shaan: Yeah, yeah.
Sam: Like, how do I make this 10? It was horrible. And then the mission statement for the employees was like, we’re going to change whatever — right now the buzzword is “democratize” — we’re democratizing the financial markets, or whatever the equivalent is. That’s what I said. Like, we’re going to change the world one newsletter at a time.
Shaan: Did you really say that?
Sam: No, but it was probably as lame. I don’t know — that would be the worst if I said that. But no, they were pretty lame. Now they’re way more honest. Here’s what I tell people now: the mission for the business — this first one is very selfish — is I want to work on cool stuff with cool people and have a great life. That’s just what I tell people. It’s very selfish. I just want to work with cool people on interesting things. That’s more the mission than anything. And then it’s like, and if we’re able to do this and this and this, that will also be cool. Versus some far grander thing. My mission statements aren’t nearly as grand anymore. Are yours?
Shaan: I’m in the exact same bucket. I definitely used to be like, changing the status quo — on my Steve Jobs stuff, you know — because that’s who you looked up to. Looked up to Steve Jobs, looked up to Elon Musk. He’s like, create an interplanetary species. Okay cool. What’s my version of that? I’m not trying to get to Mars and make humankind interplanetary, but I was trying to do the equivalent.
Shaan: You remember that story of Steve Jobs where he’s trying to recruit the guy from Pepsi and Steve Jobs says, “You’re just going to sell sugar water for the rest of your life?” Now we’re like — Logan Paul, genius, puts sugar in water and sells it to children. The audacity. So I’m like, you now.
Sam: Here were the notes I wrote on my answer for this. I wrote: I don’t kid myself anymore. I’m honest — I’m building a lifestyle business for me and my team. Almost exactly what you just said, which is I want to do cool stuff with cool people, right? Do cool stuff with cool people in a way that leads to an awesome lifestyle — meaning I’m not trying to kill myself running the business, and I’m trying to have a financial outcome for me and my team that lets us all elevate our lifestyles. This business is a vehicle to have an enjoyable lifestyle.
Sam: Which is really funny because in Silicon Valley, “lifestyle business” is the equivalent of saying “no offense” before a sentence. Like, lifestyle business is how VCs pat you on the head and say, “That’s cute. Oh, a million of revenue? That’s cute. We don’t invest in lifestyle businesses. That’s low ambition.”
Shaan: Low status.
Sam: However, for me, I feel like I broke out of the Matrix. I was like, wait, what are all these people talking about? The point of life is to have a great lifestyle. I don’t want to do something else with my life — I’m trying to have a good life, for me, for my family, for my team. We all want the good life. Okay, let’s do a project that’s fun and interesting with fun and interesting people in a way that we all get rich. Is that so much to ask? So that is now the blanket mission statement on all of my projects.
Sam: I don’t know if that’s inspiring to the troops, but it’s inspiring to me, and I hope it just attracts people who are down with that and not looking for the rah-rah save-the-world thing.
Shaan: I actually think that is a bit inspiring to the right type of person. At least when I talk to people it seems like, yeah, that sounds wonderful.
Choosing Business Models That Let You Pay Well [00:05:30]
Shaan: Another thing that changed with me is when I start new companies, I pick business models where I can afford to pay hires a lot of money. I remember when I was starting a lot of my stuff I was like, man, I can’t afford to pay a high-quality person a lot of money.
Sam: It’s a trap.
Shaan: Right, I’m like, I wish I could afford to pay someone $100,000 a year so I could recruit a certain type of person and spend time with them. So that has changed — like, what type of business am I building?
Sam: What’s an example?
Shaan: So like, traditionally media companies when they start obviously don’t make a ton of revenue — you’re putting out free content and writers are typically not that well paid. But you could run your media company a few different ways. For ad sales people, for example, you could pay them $60K a year and say they have a quota of $400K and they make $105K at on-target earnings, or you could go hire someone you’re going to pay $200K base plus a higher commission and their expectation is selling two or three million dollars’ worth of stuff. Those people, who are more competent and capable, I find are also more enjoyable to be around.
Shaan: So I’m building a business that hires fewer people who I pay more, because that setup is more enjoyable.
Sam: I had the same problem because my first business was in the restaurant industry. The restaurant industry is basically — what is the worst type of business you could select? It’s probably down there with the worst. Almost all of them fail, and even when they succeed they have like 10% net margins, typically, and you have to open multiple locations to ever make it big or have enough cash flow to hire highly seasoned people.
Sam: I remember meeting the guy who ran Chipotle — I think he was the CEO or COO at the time — and we were trying to create the Chipotle of sushi. I was like, give me your advice. I didn’t even know what question to ask. And he said, “Well, think of it this way. Your entire product is in the hands of somebody who makes $9 an hour and doesn’t want to be there. Everything you’re telling me right now about how great the user experience is going to be — that’s true for restaurant one. It might be true for restaurants two and three. By restaurant four it’s no longer true because you’re not there anymore to do all those amazing things.”
Sam: He said, “The trick in this business is whoever can figure out how to get minimum-wage employees to give somebody a good experience — they get to win. That’s the winning condition.” He talked about what Chipotle did — like, if you’re a manager at Chipotle and anyone you manage becomes a manager of a restaurant, you get $10,000, whether you work at that company or not.
Shaan: Oh, that’s sick.
Sam: They also changed the title so their manager was called something like “Restaurateur,” and they paid above market. Starbucks did the same thing — giving people benefits so they stick around. But nobody’s really figured that out.
Sam: Point is, it just wasn’t a lot of fun to be in that business. I’m an entrepreneur thinking about ideas, raising capital, big goals, big dreams — and I’m coming into work every day with somebody whose goal is to get off work early. That would be the best thing that could happen to them that day. And I was like, that’s not that inspiring every day.
Sam: I don’t mean to knock anybody — it’s just the truth. You’re going to hang around certain people when you run a business. Ideally you’d be around people who share similar values, goals, and aspirations. Then it becomes contagious. I remember we were interviewing people for this position because we kept having people flake out or steal, and my buddy who was interviewing said, “Well, I like this person — they had all their teeth.” I was like, what? He said, “I don’t know, I’m just looking for symbols. The last three people stole from us and that sucked. I just want somebody who’s not going to steal from us. That’s my new bar first.”
Shaan: Did you see on the TV show The Bear where they hire this guy and on the first day they catch him outside smoking crack?
Sam: They’re like, I think I need to fire you, but I should go ask. He’s like, yes, chef, fire him.
Your Dad’s Business Advice [00:11:00]
Shaan: By the way, there’s one lesson in there. My dad told me something — he said, “Look, you’re building a small business, but think about it. You’re still spending every waking moment thinking about how to make this thing successful. If you worked on a big business, you don’t have to spend double the hours. You’re still going to spend every waking moment trying to make it successful. A big business and a small business both take the same amount of time. Why would you choose a small business?”
Shaan: And to me that was the right advice for me, for who I was. That’s not the right advice for everybody, but someone out there needs to hear that right now — this idea that a small thing is somehow easier or less painful. It is not true.
Branding and Naming: It Matters More Than We Thought [00:12:10]
Shaan: Talk about the naming thing. My opinion has changed to align with yours.
Sam: So at the beginning, I was very precious about my idea. I wanted my baby to be cute and ready for its first day of school. Then I realized nobody cares about my baby and I have no customers and nobody’s paying attention. This thing could be called “dog crap,” it doesn’t matter — until it matters.
Sam: Now here’s the balance I figured out for me. In most cases I try to get the name right off the bat, because changing the name is kind of annoying — you lose brand recognition. And I try to get the trademark, because I made that mistake before of not owning my trademark and having to change my name a year or two in because I realized I’ll never be able to sell this without owning the trademark.
Shaan: But I don’t know if that’s true. I sold The Hustle without owning that trademark.
Sam: You didn’t own a trademark for The Hustle as a media company?
Shaan: I didn’t own anything. Because I know they have it now — we looked it up — they have it now. But what happens is if they look and they see they can’t get it because it’s taken, now you have a problem. Now you’re either going to get negotiated down.
Sam: Is that true? I didn’t even know that. Like when Moyes was selling Native Deodorant, he didn’t own the trademark and it was an issue. He’s got the deal done and they’re like, wait, you don’t have the trademark. He’s like, yeah, but there’s no other Native Deodorant. They’re like, okay, junior, what are you talking about, that’s not how this works.
Sam: And so then he’s like, I’ll just go file for it. They’re like, nope, it’s taken — some woman or some guy sitting in Palo Alto doing nothing, just squatting on it. He goes to that person, says, hey, can I have the trademark? They say no. He says, I’ll buy it, like two grand. They say no. Then they figured out he was selling his company and the price went way up, and I think he ended up having to buy it for like one or two million. He had to buy the trademark at the last minute.
Shaan: Fine when you’re selling the company for $100 million, but a very painful process.
Sam: You taught me something — I thought trademarks were nonsense. But now I do actually think they’re way important. Before I was like, names are whatever, it doesn’t matter what you call it. Now I’m on board with it. Naming and branding is very valuable.
Shaan: I don’t think a bad name kills you, but a good name lifts you.
Sam: I completely agree. And I think great design is a huge value add and costs almost nothing to have great design versus okay-to-bad design. It’s not more money — it’s taste. You just have to have the right people. You can pay for that taste.
Sam: My feeling on design: I don’t start with fancy design. I start with simple design, and then I set a milestone almost as a reward — if we get to X, then I’m going to fancy up the design. But if you’re consumer packaged goods, then the packaging is obviously super important. If you’re a SaaS tool, design matters less.
Shaan: Before I launched Hampton, I paid an agency — found an awesome agency overseas, I think 15 or 20 grand — and we did a whole branding thing. I’m like, I can’t believe I’m doing this, and it was totally worth it. Did I send you that presentation?
Sam: You did, and I liked it. I was like, oh, this is cool.
Shaan: And that’s different — you would never have done that before.
Sam: I never would have done that.
Shaan: We were both very cheap with things before.
Sam: I wasn’t cheap with spending money, but I was cheap with my time — I placed no value on my time. And I think you were cheap with spending money even though you had a bunch of cash in the bank.
Shaan: Not anymore. When I saw you spend $20K on your branding before, and you had a killer name for your community, Hampton, and then a really classy design that made it feel elevated — I was like, oh yeah, where have I been cheap? One of mine was in recruiting. I used to take pride in just recruiting myself by hand-hunting. I’d cold email people, convince them, interview them — now I hire recruiters.
Sam: For which roles?
Shaan: For every role. Anything I need — first thing I do is I just text my recruiter Carson. He’s like a great ecom recruiter. Super aggressive, instantly starts sending me LinkedIn profiles. I’m like yes, no, yes, no.
Sam: Is he a full-time employee or does he have his own shop?
Shaan: He’s got his own solo agency. I use him to hire for roles and it just saves a ton of time. Sometimes I’ll be like, yo, join this call so you see what I ask, and when you’re screening candidates you can ask these questions before me. I’m getting way better results.
Sam: How do you pay him?
Shaan: Same as all recruiters — a percentage of the first year salary. I think what I do with him is I pay him 30 days after they join. And if they don’t work out — we had one person not work out three months in — he just reimburses or credits it back.
Sam: And do you do it for even an entry-level position?
Shaan: Everything. Anything I need, I’m like, whatever I would spend the time doing, this guy is going to spend all of his time doing. It moves faster and he’s better. Why was I not using a recruiter before? I used to take pride in it. But what am I trying to save here? Let’s say you hire somebody for $100K — the recruiter fee might be 15 to 20%, so you’re going to pay $15–20K. That’s a lot of money. But if your business is working, it makes total sense to use recruiters, save time, and get good butts in seats faster versus doing it yourself. That’s time you’re not focused on the business, and it takes longer.
Reference Checks: Ask for the Bad Stuff [00:18:45]
Shaan: The biggest thing that’s changed with me in hiring is reference checks. I messaged someone two days ago, I said, “Hey, I’m thinking about hiring this one person — do you think they’d be decent at managing a small team?” The reply was: “I don’t think they could manage anyone, let alone themselves.” And my reply to that was, “Thanks,” and I don’t hire that person.
Sam: Your reply to that should be thank you so much, what’s your address, I’m sending you something — because most reference checks will not give you honesty. When somebody goes out on a limb and says, “Let me save you some pain here and give you my honest truth, even though it doesn’t feel good to take opportunity away from somebody” — you owe that person.
Shaan: I was over-the-top nice to that guy. But yeah, reference checks are so important.
Sam: I do two things differently. One: I always ask for three references and then I call those three and I ask who else did this person work with. I don’t give a damn about the three they give me — I’m trying to figure out who I can reference that they didn’t provide. But also I won’t blow up the applicant’s spot if they haven’t told their current employer.
Sam: Then here’s what I ask. I want to hear bad stuff about the person and figure out if the bad stuff is stuff I’m okay with. I say, “What are they on a scale of one to ten?” They always say an eight or a nine. Then I say, “Alright, how could they be a perfect ten? What’s missing?” That’s typically when they tell me the bad stuff. I’m always looking for that. And I’m like, okay, I could put up with those types of mistakes — or, they miss deadlines all the time? I’m not willing to put up with that.
Shaan: Someone taught me a good way to do reference checks. There are two things I do. One: you’re trying to figure out if this person is one of the best people they worked with at that company. I’ll ask, “My experience is that at every company, you can look around the room and there are two or three people who just have the team on their back — if we didn’t have this person, we’d be in a rough spot. Who are the people like that at your company? Would you count this person as one of them?”
Shaan: I’m looking for how much conviction they have — “oh yeah, for sure” versus “yeah, you know, they’re good.” You can say “yeah” two different ways and I’m listening for which one it is.
Shaan: The second thing I ask: “I’m leaning towards hiring them — I’m trying to disarm them, not make them feel like what they say will mess it up — but I don’t feel comfortable because I don’t know what they’re not good at. Everybody has things they’re not good at. I’m not sure what they are. What are they for this person, so I can feel like I have the full picture before I pull the trigger?”
Paid Tests and Learning to Interview Better [00:22:00]
Sam: Why’d you write “paid tests”?
Shaan: My thing with hiring — two things have improved it. Number one: paid tests instead of interviews. I’ll spend three or four hours creating a paid test. I create a doc: here’s a brief, I’m going to pay you — depending on the role, maybe $200, maybe $2,000 — spend a day on this. Words equal lies. I’d rather just see your work than hear you tell me you’re good at work. Paid tests have saved me a ton of time.
Shaan: The second thing: I have a buddy who I let invest in one of my companies. I kind of realized that a CEO’s job — any leader’s job — is decision-making. Good judgment, over and over. How do I get my decision-making to be better? The difference of making 10 to 20% better decisions every single month adds up to a very different outcome.
Shaan: So I brought this guy in and said, I want you to do three interviews for this one role for me. I’m hiring a CMO — a chief marketing officer — and I think this is the make-or-break hire for this business. I want you on the call. I want you to lead the interview and I want to just listen.
Sam: Wait, you let an investor do that?
Shaan: He’s one of my best friends. He invested in my company and he himself is a founder, so he’s got a lot of experience. I’ve seen him make great hires.
Shaan: What happened was: I would interview them, then he would interview them. I would like them and he’d be like, “No, trash.” I’m like, what? What did I like? What didn’t you like? And the thing for him was always: he pressed for specifics way more than I was. I would say, “Tell me a story” and they’d tell me one story. He would say, “Cool — what was the revenue when you started, and how did it grow in the first 18 months?” If they don’t even know that number, they’re out. If you’re the CMO and you don’t know how much revenue changed from month one to month twelve, you’re out.
Shaan: Then he’d say, “What were the three things that most impacted that?” And then, “You did that thing — can you screen share real quick and show me how you think about this? Talk out loud.” There’s a different level of specificity there that I need to be doing in my interviews. Seeing how a master does it helped me up my game.
Goal Setting: Floor Goals, FIA Goals, and Anti-Goals [00:26:00]
Sam: That’s interesting. What was your before and after on goal setting?
Shaan: My before: I would create the most ambitious goals because it was just mental masturbation — using a spreadsheet and saying like, yeah, we’re going to 3x this year and five, look at that, I’m like, yeah, change that three to a five, change this zero to a nine, boom, we’re there. All right, get after it, guys.
Shaan: I didn’t understand that they’re the ones doing the work, so it’s kind of messed up that I’m creating crazy goals with no math behind them. I also thought that really ambitious goals were inspiring. I actually think achievable goals are inspiring. I try to hit like 75–80% of the goals we set. Hitting goals that are not that ambitious gets you a better outcome than missing incredibly ambitious goals.
Sam: It creates more momentum.
Shaan: Momentum is key.
Sam: My goal thing now: every time I start a project — whether it’s a company or just an initiative inside a company — I’ve got this thing called the kickoff doc. It’s a one-page doc I fill out religiously. It starts with, in plain English, what are we trying to do? Then: what does winning look like? That’s where I set two goals.
Sam: I have a floor goal and what I call the “FIA goal.” The floor goal is: below this, I’d be surprised and a little disappointed. The FIA goal is what would have us running around chest-bumping going, “Oh my God, I can’t believe it happened.” Now I have a range — my min and my dream. We’re going to shoot for the dream, but we’re going to understand that anything above the floor is a win. And we ask: what would it take to get to the floor? What would it take to get to the ceiling?
Sam: The second thing I do is set an “anti-goal.” Learned this from Andrew Wilkinson. You could achieve double revenue, but if I wake up every day stressed out, or if I doubled revenue but profits went to zero because I spent so much on marketing — well, then I kind of lost while winning.
Sam: The specific thing: what are the understandable traps we could fall into while trying to achieve these goals? For example, with this podcast you’d be like, “I want to double downloads.” Great. What’s a trap? Every day I’m on the algorithm trying to figure out what clickbaity thing I could do where I’m knocking on neighbors’ doors asking them how they made their money and then I pants them and put a pie in their face. Yeah, that would do it — but I would sell my soul and lose some dignity. So anti-goals are really important.
Sam: The next thing on goal setting: much more important than the goal itself is keeping it top of mind. I would do these big bursts of planning, set a goal, then three months later it’s like, hey what’s the goal, and it’s not even on the tip of anyone’s tongue. That’s backwards.
Sam: First of all, I shouldn’t be the one setting the goals. In Game of Thrones, there’s the opening scene where Ned Stark has to execute the guy, and his son asks, can’t someone else do this? And he says, “He who speaks the sentence must swing the sword.” I can’t expect you to go do all the work for some goal I set sitting in my boxers in Excel. So now, if I’m going to set a marketing goal, I set it with the CMO. The CMO has to own that goal. They have to feel it’s what they want, that it’s achievable. I’m going to push back or hold the standard, but they’re going to ultimately speak the sentence.
Sam: Then the second thing: how do we keep this top of mind? That means creating rituals where we’re looking at KPIs daily and weekly, asking the right questions. It’s far more important to regularly look at the data versus trying to set a great goal once and then never really looking at it.
Managing Your Temper and Making People Feel Small [00:33:00]
Shaan: Do you lose your temper and yell? Have you ever made an employee cry?
Sam: Not because I yelled. I’ve never yelled. But I could be, like — I’ll be like, “Hold on, what the hell are we doing here?” But you’ve never been like, “You’re an idiot”? You’ve never insulted someone?
Shaan: Well, there’s some finesse to my rudeness where it’s like a backhanded slap, not a fronthand slap. But there have been many times in the past where I’ve lost my temper and I was just a huge jerk to someone, and I deeply regret that. Not only is it wrong, but I’m not going to get my desired outcome. They’re not going to change.
Shaan: The way I used to react to bad news: I would yell at people sometimes, lose my temper, freak out. And I realize that is just so weak. I’ve come to the conclusion that I can’t change people. Someone is either a great executor who sometimes makes mistakes, or they’re just not good. And I think losers exist and I don’t want to surround myself with them. Your sign is like a store that says “no shoes, no shirt, no service” — losers exist, we must avoid them.
Sam: Like, keep them out.
Shaan: Yeah. And sometimes I’ve been a loser. When I was working at Twitch I tweeted this out right after I left — there’s a pattern, which is that when someone’s great, odds are they’re great kind of right away. The best people I’ve ever hired, it’s pretty obvious within three to four weeks that they’re amazing, and then they just stay amazing.
Shaan: The only consistent pattern I found with late bloomers was I hired somebody before I even understood what role they should have. When they had an undefined role they didn’t do very well, but when I defined a role and said, “This is what you need to do,” they performed. What I found is that when I have a defined role for someone and they’re still not very good — it never changes.
Shaan: I used to lose my temper, curse, make people feel stupid, and that’s such a bad mistake because A, it’s just wrong, and B, I’m not going to get my desired outcome.
Sam: I still suck at that, I’d be honest. I’m not like a yeller, but I can make people feel small. I kind of realized this the other day — in every interaction, you’re either going to leave someone feeling a little smaller or a little bigger based on how that interaction went. And I was like, damn, I think I make people feel small a lot. I think I’m doing it in service of “we’re doing dumb stuff, we need to do the right thing,” but I’ve seen people who are really good at still getting the thing done without ever making people feel small.
Shaan: Who’s an example?
Sam: Our buddy Sully, I think, is pretty good at that. I don’t know what he’s like inside of a company, but I’ve seen him in an advisor-type role. I know what he’s thinking in the moment — I’m like, oh man, he’s looking at this being like, what in the actual hell is going on here. But that’s not what comes out of his mouth. He will finesse his way there. And I don’t think it’s because he’s a kinder, nicer person — I think it’s because he’s realized that’s not how you get to your desired outcome.
The Firing Conversation [00:36:30]
Shaan: In fact, the one time I did make somebody cry was when I was firing somebody. I realized in that moment — he’s not crying just because he’s sad that he’s getting fired. He’s very surprised. And that’s on me. I was too scared to be clear upfront that, hey, this isn’t going the way we need it to go, it’s got to go differently, this is not currently at the level. I avoided that tough conversation, and now I’m having a tougher conversation because I avoided that one.
Sam: How many people have you fired?
Shaan: I don’t know, like really.
Sam: Yeah, that’s a lot, right? I don’t know — I’ve been going for 16 years. Like, one a year? Not that much. I’ve not fired that many people. I’m such a punk.
Shaan: There’s a story about Dave Portnoy — like, Dave Portnoy is just, “I don’t fire people. It’s impossible to get fired by me. I’ll just pay you and you’ll just be lazy and a bum and I’ll just make fun of you and it’s good content.”
Sam: I kind of feel the same way. I suck at firing. I have a good script though — I basically say right off the bat, “All right, this conversation is going to stink, but I’m firing you today. We can talk about why if you want.” Now I don’t even say why, I’m just like, “This isn’t working out” — because it doesn’t benefit me to say why, it only hurts you.
Shaan: But I’m horrible at firing people. I hate having that conversation so I avoid it.
Sam: Yeah, but it’s just like anything else — you stretch the pain out longer versus ripping it off.
Shaan: The key to firing — and I say this because everybody who becomes a manager, don’t worry, you suck, everybody sucks as a manager at the beginning, nobody is naturally just an amazing manager right off the bat, it is a learned skill — the key to firing is in the first ten seconds you need to say the news. Do not beat around the bush. “The reason we’re here today is because we’re going to let you go.” That has to come out of your mouth in the first ten seconds. If you say anything else in the first ten seconds, realize you’re being a complete jerk — because when it does come, and they realize, “Wait, what were you just saying all that stuff about?” you’re going to blindside them in a much worse way. It’s key.
Saying No, Staying Focused: The Big Bets Doc [00:39:30]
Sam: I have a couple other areas I want to ask you about. One is focus — knowing what to say yes to and what to say no to. Do you have anything that you actually do to make that better now?
Shaan: I think I’m so good at focus, and I’m also bad at it. I’ve missed a lot of interesting opportunities. By default I say no to everything, and it’s actually cost me. At The Hustle we thought about launching multiple newsletters and I was like, nope, we’re just going to do this one thing. We’re going to do it well because Scott Belsky told me to focus and only do this one thing. So I said no to everything, and our competitor did launch multiple newsletters and scaled their revenue significantly faster. So I said no to too much.
Sam: My default was just I’m going to say no to everything.
Shaan: That’s interesting. I’m the opposite — shiny object syndrome kind of guy.
Sam: By the way, The Hustle didn’t even have an Instagram handle until like four years in. I was like, no, we’re not going to do social media. We’re doing nothing. We’re just going to do this one stupid newsletter all the time.
Shaan: One of my biggest — actually, speaking of being cheap — one of my biggest regrets, deep in my soul: one time I bought all the supplies from Costco for a conference and ended up returning $2,000 worth of canned soda. The lady at the front desk was like, “You’re pathetic.” She’s like, “We throw all this stuff away — is this just from some party that you threw?” And my answer was even worse, which was, “No, it’s for a business conference that made a lot of money.” It hurts my soul that I was so cheap that I returned open cans of soda to Costco for $2,000. That crushes me.
Sam: That’s next to that one time I tipped a taxi driver and he said, “Oh no, you don’t need to do this,” and I said, “Oh no, you need it” — instead of “you earned it.” Those two things are like the two things that crush my soul.
Shaan: So, focus. As we get back on track…
Sam: I now have a thing called the “big bets doc” for every business, every year. It’s basically: we are going to make some bets this year, let’s be super conscious about what we’re saying yes to and what we’re saying no to.
Sam: I’ll write it like this: “Bet number one — we really suck at inventory management today. Forecasting is just me looking at a spreadsheet and making up numbers based on what I hope happens. I know there’s probably a smarter way to do this. Other people have certainly solved this problem. I need to figure out how to hire people who know how to do this. So the bet is: I’m going to hire two people, and that’s going to lower our waste from X to Y.” I write a sentence like that, and that’s my bet — I’m going to make this hire for this outcome because of this problem.
Sam: I would do this even for the podcast. Big bets. Hiring Ari — okay, why? Or we just launched the clips channel — okay, why am I going through this effort of clipping my favorite parts? Because I hope that somebody out there wants to just listen to the best parts on YouTube when they come up, because that’s how I like to listen to things. So I’ll write it out: if I’m going to invest my effort, my time, my money into something, I write it out.
Sam: I write the big bets — here are the three to four big bets we’re going to make, the things we’re going to invest in and try to do really really well. Then I make the “no list.” The no list is: there are a bunch of other things that we could talk ourselves into doing that are easily justifiable, however we’re going to say no to these things this year because we want the things above to actually happen. So I make the no list — here are the things we’re not going to do this year that we totally could have talked ourselves into.
Sam: Then when I bring people on, I sit down with them with this big bets list. I’m like, here’s what we’re doing. And for whoever’s responsible for a given bet, I treat it like a commercial — I need this to be memorable. I shrink down one of these bets into almost a slogan or a jingle for their role. It’s like, “Your mission is this.” I’m going to say that to you probably a hundred times in the next three months. We’re going to keep checking in on that. That’s how I’m going to bonus you. That’s how I’m going to assess your performance.
Sam: I took this from Peter Thiel, who said he did this at PayPal — “I don’t know, management’s not my favorite thing, so here’s my shortcut: everybody at any time has one priority. If you ever try to talk to me about anything other than that priority, I will simply leave the room.”
Shaan: I thought that was just hilarious. What a weirdo.
Sam: What a weirdo — if someone walked up to Peter Thiel, “I have an idea about a new program we could do,” and he just like drifts away like a hot air balloon.
Shaan: There are stories of Elon doing that too — in an interview, within 30 seconds he would just hang up. And he emailed out at Tesla something like, “If you’re in a meeting and in the first few minutes you realize this is not useful to you or to anybody — please stand up and leave. Your time is valuable, these meetings are a drain. Vote with your feet. Just get up and go. That is a completely acceptable behavior here at Tesla.”
Email and Communication Management [00:47:00]
Sam: Do you ever send emails where the subject is the body of the email?
Shaan: Yeah, of course — it’s like a pager. You’re treating it like a pager.
Sam: I had one of the only jobs I ever had where my boss sent me an email like that. And I was like, is this how we send emails? Then I sent him an email with the status question in the subject and the reply was: “Don’t ever send me an email like this again.” But I love email.
Shaan: I actually think there are different levels. What I realized is that rich people and busy people treat email like texting — lowercase, on their phone, one line, totally fine, that’s their normal way. Then mega-rich people treat email like it’s letters. They’ll have somebody actually screen them, print them out, and then they’ll kind of review them at their desk on paper.
Sam: Who do you know who does that?
Shaan: I think Mark Lore does that. Trump doesn’t even own a computer — he told us that.
Sam: I’ve met a couple of people. One of my old bosses used to print out his important emails and leave them on his desk so he could look at them and just leave a sticky note on them, and she would go figure out what to do.
Shaan: I worked for a guy who had four women at the office with giant TV screens just managing his inbound emails. He would walk around, they would be like, “Oh, this person said this,” pull it up on the screen, and he would just orally dictate his reply and then walk away. It was insane.
Sam: Most of the day I feel like I’m responding to stupid messages — on Slack, Twitter, text, email. I cannot stand it.
Shaan: So I actually think printing out that thing and replying could be kind of cool.
Sam: Or you need some kind of firewall. For me it’s like my assistant is the firewall — she triages all the emails, and I only check my email for 30 minutes a day because it’s already taken care of. If there’s something that needed a faster reply, she’ll text me. That’s it.
Pre-Product Market Fit vs. Post [00:50:00]
Shaan: There’s one other thing that’s worth saying: there’s a big difference between pre-product market fit and post. What you do before you have it versus after is very different.
Shaan: I think most of this conversation has been about post. But actually most of my life has been about before. Before you have product-market fit, you don’t do any of these things. You literally just figure out what your product is and you go try to sell it. You get rejected, you handle that, and you iterate until you figure out what the product should be, who the customer should be, and you’ve proven how to connect product and customers. That’s worth saying. Then after you have figured that out — after you’ve proven that this product actually has a market and you know how to communicate it to customers — then you hire people to do more of that.
Sam: I saw you firsthand with Hampton doing this. There were a couple of months where you showed me your calendar and it looked like a Jenga tower — 20-minute calls stacked on top of each other, sometimes overlapping. And you’re like, “Yeah, I’m trying to go get the members for Hampton, trying to figure out what Hampton is.” You sent me like a script or a landing page you were writing yourself, trying to explain what the benefits are and who it’s for, and you’d consider, should I take this angle or this angle or this angle? And I would help you reply on the Google Doc.
Shaan: It’s kind of like being a comedian. When Hasan Minhaj finally does his Netflix special, he’s done 200 sets before that. You see which angle hits. I’ve got to see which angle is hitting.
Sam: Someone tweeted — or some line out there — “Product-market fit is like sex. If you have to ask, you’re not having it.” And I was like, that’s so stupid. I’ve definitely asked in both of those situations. That’s one of those lines that sounds good but it ain’t true. I was uncertain multiple times about both things. “Is it happening? Is this it? Is this happening? Are we doing it?”
Shaan: And that’s the pod.