Ben Horowitz - "Your ONLY job is Right Product, Right Time"

0:01You people are doing everything but your job. You're writing these requirements, you're pitching customers, this and that, but you're doing all this stuff. It's a lot of work. But your job is right product, right time. And if you don't give me the right product at the right time, I don't give a fuck what you do. The story of the company is, why do we exist? Why should this be a company? Why should you join this company? Why should you invest in this company? The why is the depth. If you know the why, I don't even have to tell you the what, because you know what to do. Founders spend time on everything.

0:32Hiring, fundraising, product specs, customer conversations. But at the end of the day, there's only one thing that determines whether a company works. Whether you deliver the right product at the right time. Everything else supports that goal. Strategy evolves as you learn. The story becomes how you communicate it. And the team exists to execute it. But none of it matters if the product isn't right. In a world where tools are changing faster than ever, the core challenge remains the same. Here's Ben Horowitz speaking at A16Z's Speedrun on what it takes to get it right. Another challenge that we talk about here at Speedrun often is sort of building teams.

1:16Many of the folks who are bringing on their first employees, their first sort of set of hires. Confound, that's it. What do you find has worked best in teams trying to attract top talent early on when they don't have as much of a brand or a track record just yet? Well, if you have a brand, all you have is a story, right? So this is something that I think founders often neglect over time. So the story of the company is also the strategy of the company. Nobody's got some strategy in their back pocket that's entirely secret. And then they've got a story that's different. So, like, that's the one thing.

1:59And the truth about strategy is it's not like a meeting that you have and you go out with your team and go, like, what's our strategy? Okay, everybody, give me your input. And then we assemble this strategy by committee. What really is happening is you have the initial idea. You're learning about the market. You're learning about the customers. You're learning about the technology. You're learning about each other. and in your mind you're kind of adjusting that strategy a little bit at a time every day. But then a quarter later it's actually pretty different than what you started with. And so it's really important that you keep upgrading your story, the articulation of your story.

2:40Like I would definitely recommend it be in written form and it kind of be something that you can share with everybody in the company, but everybody you're recruiting, everybody you're trying to raise money from, like all your constituents, every customer. What the hell is the story of this thing? And the problem that I think founders have is it doesn't feel like work. Like, what are you doing today? I'm working on my story. That doesn't sound like work. Why don't you have like OpenClaw write that for you, motherfucker?

3:13But sorry for the language. I used to be a CEO. So because it doesn't feel like work, people don't do it. But it's probably one of the most important parts of the job is to have that thing really. And even like today at the firm, John will tell you, like, I write the story every once in a while, not all the time. But it's very helpful for people to just go. And it's helpful for me to go, this is what we're trying to do here. And just double-clicking on that because I feel like that's so important. What does that look like tactically when you say writing down stories? Is it being active in social media?

3:44Is it a culture doc? No, no. I think the culture is kind of separate from the story of the company. The story of the company is like, why do we exist? Like, why should this be a company? Why should you join this company? Why should you invest in this company? Why should you work at this company? You have to answer that question, the why. So the story is answering the why. Like, you have KPIs and OKRs or all that kind of stuff. That's what. But the what is kind of a vague interpretation of the why. The why is the depth. If you know the why, I don't even have to tell you the what. Because you know what to do.

4:17That's a strategy. I know what my job is. I'm going to go run after that. It depends on what medium you are best at articulating yourself in. But I think that I would say like writing it out long form helps a lot because it forces you to be the most disciplined on it. But you just have to have a running articulation of the why. Do you feel like in an AI world where now the nature of talent and teams is changing very rapidly, do you feel like founders should be trying to look for particular traits or skills in the employees that they're hiring? What would you look for if it's different than talent from pre-AI?

4:53So I think it's a little hard to know. I mean, it depends on the position. It depends on the company and all those things. But I do think two things that, at least in Silicon Valley, have probably been underrated over time are going to increase in importance anyway, which are creativity and, like, ability to create and maintain relationships. I think those are things that are hard to get out of at least today's AI in a very good way. So if you don't have instincts around those things, it's, I don't know all that, all the AI in the world can help you. Whereas kind of like the grind them out tasks, AI is already really good at.

5:35So those are things like, do you have original ideas? Can you establish and maintain very high quality, high fidelity relationships with people off the rip? Like, I think people don't think about that enough. In my business, like, I would say people don't value that highly enough. One big advantage I think that we have at the firm is we really look for that on the relationship side. But many firms just ignore that whole thing. Like, it's not a thing. It's a thing. And on the creativity side, there's an element of taste there as well, right? Do you have good taste in decision-making and the people that you hire and so on and so forth?

6:12Yeah. But just like ideas, you know, I find what's very valuable is just people have new ideas on what to go pursue. So, I'll give you an example. So, we had kind of a legendary marketing organization that we had built, but we built in 2009. So, it was very oriented towards traditional media. And then it was very hard to get breakthrough ideas about how to use new media. And then as we brought in people who were very, very creative on that front, all of a sudden we were able to do that super effectively. But it's difficult. Not everybody has a ton of ideas around a new thing. That's actually not that common.

6:57You wrote a classic essay a number of years ago called Good Product Manager, Bad Product Manager. Yeah, it was like the first thing I wrote, I think. It was required reading for me when I started being a PM. And you didn't work for me. I don't know who required that. I literally wrote it for seven people. That was the audience. The people, seven people, product managers who worked for me. I was so fucking mad at them because I was like, you people are doing everything but your job. You're writing these requirements. You're running around pitching customers, this and that. You're doing all this stuff.

7:35It's a lot of work. but your job is right product, right time. And if you don't give me the right product at the right time, I don't give a fuck what you do. I need you to do that. And so that was why good product manager, Brad, that was the whole idea. It wasn't anything. It was just like that simple, this is the job. All these things that you're running around doing are not the job. This is the job. Like, you know, like a BB's in a beer can. They were bouncing, doing this. I'm doing that today. That, that, that. I was like, well, am I going to get the product I want? Oh no, I'm just going to get a bunch of fucking random features that everybody told you you should put it in.

8:07What do you think holds true about sort of those principles in today's age where it feels like the AI landscape is shifting so quickly? Does it even make sense to have a PM? What is the product leader's job today in this landscape you feel? Right product, right time. What else is it? Landscape. So this is you sounding like my fucking product manager. It's like, oh, now the landscape is different. I won't write a PRD. I'll write a prompt. Okay, great. Is it going to get you the right product, right time? If not, it doesn't matter. That's the only thing. That's the only thing that job is. And look, there's a lot that goes into it.

8:47You've got to define the product correctly. You've got to market it correctly. People have to understand that you have the right product. Somehow it's got to get out there. The engineers have to be able to build the thing. There's a lot that goes into it, but that's what it is. And if you can't do that, then Opus 4.6 can do. like all those tasks, no problem. But almost for a second, the key decision point today is what problem to focus on at all in the beginning. And then a lot of the actual tactical steps, to your point, Opus can do a fantastic job at the PRD and wrangling agents and so on and so forth.

9:20Yeah, I mean, it's a very, very hard problem. If you can do it, you can found a company, you can create something. You know, it's a very difficult thing to get to a right product, right time. You have to understand a lot about the world. You have to understand a lot about the technological landscape. You've got to understand a lot about the technology that you have. And I'm not saying it's easy, but I'm saying that's what it's always been. And like the problem with a product is kind of the technology, right? Like what's technologically possible? It's, you know, if you've already got one in market, it's like, what do the customers of that want?

10:04It's, what does the market want? You know, what is the competition doing? There's a lot of things that go into, like, is this a product that's going to work? And I think you need somebody who's responsible, accountable to all of that.

10:23now, you know, maybe you've got like a product architect who's already good enough to do that or these kinds of things. So like, I don't think the title matters, but that thing matters. What are the opportunities out there that you would be most excited to potentially build? Well, that's why I'm not like a founder now. Like you're asking me. I'm like running a venture capital firm. Like there's so many. I'd say like one of the most interesting areas are the areas that we have shortages in. Like we funded a company, which I never thought we would fund that's doing a new transformer, not like a model, but like a literally a power transformer because there's like a massive shortage in power transformers.

11:06It's like a big problem if you're trying to build a new power plant, which we need a lot of. And, you know, it's a very interesting idea how to do them like much easier, more efficiently and so forth. So I think, you know, like we've got electricity shortage, chip shortage, token shortage, going to have cooling shortage. So like there's and there's all kinds of levers that you can pull to alleviate some of those shortages and those will be valuable. So, yeah, if there's unlimited demand for tokens, which there seems to be like, what are the supply side issues, I think is pretty interesting. And then, you know, there's just all kinds of like problems of humanity that have been around for a long, long time, like cancer and things like that, which are now kind of solvable.

12:01So I think there's really interesting opportunities. So as a founder, this is what you shouldn't do. You shouldn't like just pop random ideas off of your head. You have to actually go in, try and do something hard, and then figure out where there is no solution in the world and then go solve that. If you have an idea and you're working on it and you've been working on it for some time and it doesn't look like it's working, how do you know when the right time is to pivot or to continue to keep going? Are there signals that you look for from the market? is to sort of, like, how do you think through that?

12:40You know, that's very specific. Very, very specific question. Pivots typically, you know, as somebody who's done a pivot, pivots typically, you know, don't work, particularly if you get to a certain scale. So doing a late pivot like I did, I think is very difficult. And so you better have no choice because any choice is better than that choice, I would say. I think that, look, if something changes, you made some set of assumptions when you started. Some set of those are always wrong. So you're always a little bit pivoting. Like nobody goes, oh, I'm going to do this, and then they go build it, and it's exactly as they laid out.

13:24Like that never happens that way. So you're going to change the idea as you go, but you're kind of like, okay, what did I think in the beginning? What did I learn? What's the delta? does that mean this whole thing is unviable or I have to make some adjustments? That's always a question that you're asking yourself, but I don't think there's any kind of miracle idea that you have that goes, okay, time to pivot. I've checked these 17 boxes and now I'm fucked, so I'm going that way. That's not really the way it works in reality. Chris Dixon has talked about the idea of navigating the idea maze, right?

13:59It's like you're sort of trying every potential. Yeah, everybody is going through the idea maze. There are no ideas. There's only the idea on these. And, you know, you're going to run into a wall in the market. You're going to run into a wall with competition. You're going to run into the wall with the underlying technology. And you're going to have to keep moving. A major thing that comes up for discussion all the time is defensibility today. That if you're building an AI application, it feels like it can get copycatted very easily these days. I think defensibility just in general is very tricky when things are moving so fast.

14:32How should the founders think about defensibility? Like, what is the sort of unit of competition these days? Is it momentum? Is it speed? Is it the team? Is it culture? It feels like there's a... How should they think about that? I mean, I still think, look, there's still hard technical problems to solve. And so, like, if it's a hard technical problem, that's... For example, like, a model for a humanoid robot is, like, a pretty hard technical problem still, despite everything. So, like, that's one thing. Look, you know, possession of the customer is still very, very valuable. And look, an easy example of that is ChatGPT.

15:12Like, how much model differentiation does OpenAI have at this point? You know, maybe they have negative differentiation in some areas, but they've got the most consumers, and that still matters, and that kind of can get them to the next square. And the brand. Yeah, and the brand. So those things, I think as long as the customers are humans, that's still quite a big thing. What advice or things would you suggest everyone think about as they go into their first set of fundraisers to sort of help them be successful? Yeah, man, I really think that knowing, like, being able to articulate really why you're building this company in a way that convinces even you that you should rejoin your company is really a thing.

16:09So you want to, if you can convince yourself like completely, like this is the greatest freaking idea in the world, then that's the most compelling thing. I think that the mistake people make in fundraising is they go, well, what does Ben want to hear? And does he want to see a graph like this or does he want to know this about market size or whatever? That's very hard to figure out and you usually get it wrong. But you can know, like, how would I convince myself to join this company is really we're investing in this company. And let me make that argument. I think that always works the best because that's also the thing that you're not going to get talked out of in a pitch.

16:54That's the worst thing that can happen to you is you get talked out of your idea. It's like, well, why the hell aren't you doing this? Oh, I hadn't thought of that. Well, don't do that. It's as much about finding the right partner for you, right? Like someone who actually understands the vision and is going to go along. Yeah, I mean, I think that you want people invested who really want to invest in what you're doing, not what they want to hear. Yeah. It's just like a bad, way to start a relationship too, right? Like I'm going to pretend to be this other person and then you're going to like me, but then we're going to get together and you're going to find out the real me.

17:34And that tends not to work out either. I looked at that. Let's give a big hand to Ben. Thank you, everyone. Thank you, Ben. Thanks for listening to this episode of the A16Z podcast. If you liked this episode, be sure to like, comment, subscribe, leave us a rating or review and share it with your friends and family. For more episodes, go to YouTube, Apple Podcasts, and Spotify. Follow us on X, A16Z, and subscribe to our Substack at a16z.substack.com. Thanks again for listening, and I'll see you in the next episode. As a reminder, the content here is for informational purposes only. It should not be taken as legal business, tax, or investment advice, or be used to evaluate any investment or security, and is not directed at any investors or potential investors in any A16Z fund.

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