I listened to a friend criticize a founder’s decision on an important issue. The founder originally told his staff they would do X. A few weeks later, he changed his mind and decided to do Y. I was curious why he changed his mind, so I asked. In short, the data changed. His initial decision was based on a projection that had materially changed since then. If he’d stayed the course, the result could have been serious challenges for his company in the future. The initial decision was well communicated and well received. But when the decision was reversed, there was no official communication; people heard about it through the grapevine.

Hard decisions must be made when you’re leading others. There’s no way around them. Making difficult or unpopular decisions isn’t what gets leaders in trouble; it’s the way they’re communicated—or not—that can land leaders in hot water. Some leaders avoid delivering unpopular news for fear of upsetting their teams. What they don’t realize is that people are often OK with whatever happens if they know why it’s happening. And people don’t like uncertainty. They want to hear from their leader when there’s important news that could affect them.

If you’re a founder, there’s nothing wrong with changing your mind or making unpopular decisions. It comes with the territory. But be aware that how you communicate your decisions can have a lasting impact on your team’s confidence in you as a leader.

I listened to an interview given by the CEO and co-founder of Coinbase. This cryptocurrency marketplace is publicly traded and, as of this post, has a market cap (i.e., valuation) of almost $14 billion. Brian Armstrong co-founded the company in 2012 and has been the CEO from zero to $14 billion public company, so I was curious to hear what he had to say.

It’s a lengthy interview with lots of great nuggets, but one especially stuck with me. Asked for advice on surviving the early days (when you have a team of five or fewer), Armstrong said, “If you’re pre-product–market fit, the best advice from that period is action produces information. Just keep doing stuff.”

Armstrong elaborated: doing something, even if it’s wrong, will produce information. Whatever you do will be proved to be either a good move or a failure. If it’s a failure, you’ll learn from it and get a better idea of what you need to do to achieve success—the right next step or solution to the problem. If you do nothing, though, you get no information and make no progress.

Some people are hesitant to act because the path to success is unknown. Armstrong addresses this with an analogy. Trying to do something great is like being at the base of a mountain shrouded in fog. You look up to the top and ask yourself how you can get there. You can see only three or four steps ahead because of the fog—the path to the top is hidden. When you take a few steps into the fog, you can see another three or four steps ahead but no more, because the fog is still there. The only way to uncover the path to the top is by taking steps into the unknown, which reveals the path a few steps at a time.

I enjoyed Brian’s thoughts, and I agree. If you want to hear this part of the interview, take a listen here.

Today marks the end of my one-hundred-twenty-second week of working from home (mostly). Here are my takeaways from week one hundred twenty-two:

• July – Today is the last business day of the month. July flew by, and the end of summer is fast approaching. I want to make the most of these last few summer weeks.
• Good people – This week was a reminder that the world is super small and good people know other good people. I connected with someone in another country, and it turned out that we have many unexpected mutual acquaintances. Those people helped me quickly understand that my new connection is a quality person.
• Hustle time – I had conversations with a few friends working on new ideas that they’re hustling to get off the ground. Being around other people also in hustle mode energized me.

Week one hundred twenty-two was calm. Looking forward to next week.

I read a quote today that I like:

“There are those that look at things the way they are, and ask why? I dream of things that never were, and ask why not?”

~ George Bernard Shaw

Perspective has an outsize impact on our decision-making and actions. Accomplishing the impossible is the result of asking “why not?”

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A buddy shared an interesting thought with me today. He believes in building an entrepreneurial platform. As a founder builds his business, he institutionalizes the knowledge and relationships from his journey in the platform. As his success grows, the platform grows too. The process of building this platform is intentional. It may take years, even up to a decade, before it has significant substance. It doesn’t take away from his entrepreneurial success or slow him down materially if he adds to it as he goes along (versus at the end of his journey).

This approach gives the next crop of founders with access to the platform an advantage. They benefit from the know-how and relationships the previous founder developed. The new founders can use the platform to do more earlier in their journey because they don’t have to endure as much trial and error. They’re positioned to go further than the entrepreneur who went before them. As new founders reach new heights, they add know-how and relationships from their journey to the platform to help the next generation of entrepreneurs.

I like my buddy’s ideas and want to think more about this.

When you’re trying to accomplish something meaningful, it usually doesn’t go up and to the right. There are periods when things don’t pan out. You feel like you’re not making progress. This is often the part of the journey that’s most challenging. People get frustrated that things aren’t going according to plan and get down on themselves or give up.

I was chatting with a buddy today about this part of the journey, and we agreed it’s where people separate themselves. The average person feels like things are out of their control and gives up. Successful people take control and refuse to give up. They start hustling. They focus on increasing their activity level in hopes of something happening that gets them out of the lull. More times than not, the hustle leads to something unexpected happening and getting their journey back on track.

If you’re working on something you believe in and you hit a lull, don’t give or get down on yourself. Start thinking about how to hustle your way out of the lull.

I listened to a successful founder share his story. Part of his journey was a painful realization that he wasn’t the best. He connected with a peer group of type A personalities and quickly realized he wasn’t the most intelligent person in the group. He was smart, but others were smarter. This was tough to swallow because he’d always performed well in school and ranked at the top of his class. In this group of overachievers, he was, as he put it, “average . . . at best.”

As he came to grips with his ranking in this peer group, he noticed something else. Some of the others didn’t give their all because they didn’t have to. Their intelligence allowed them to give less and still get by. They weren’t consistent because they didn’t have to be.

This person went on to found a start-up and later exit it. He’s the only one in his peer group to have done this. When he was asked about his success compared to his peers’, he said something interesting. He wasn’t the brightest person in his group, but he made a point of giving his best effort every day. His work ethic was consistent, and he believes that this (along with luck and other factors) is what allowed him to excel.

His watchword now, when working with others, is “you don’t need to be the best, but I gotta have your best.”

This founder was brutally honest with himself but didn’t let it discourage him. Instead, he found something he could control that would give him an edge. I really like his approach because he focused on playing the hand he was dealt as well as he could—not dwelling on the hand he’d have liked to have had.

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I had a discussion with a buddy about different leadership styles. We talk about a few founder friends and compared their styles. I believe leaders have to figure out what style works best for them. Some people are great motivational speakers. Some are quiet and lead by example. All can be effective.

My buddy expressed a view that I hadn’t thought about: Leading by example is your only option when you have a team of A players because smart people don’t care what you say—they’re watching what you do and will take their cue from that.

I don’t totally agree with my friend. Smart people listen to what leaders say, but they take it a step further. They verify by paying attention to what leaders do. They make sure there’s alignment between a leader’s words and actions. When there’s a disconnect, they take note. Saying something is a lot easier than living it. So, when words and actions don’t align, smart people believe that action represents the truth. If a leader’s actions aren’t what they expect or don’t align with their values, you can expect them to start planning their exit.

If you’re a leader and you want to build an amazing team, remember that A players are listening and watching. Your actions must align with your words. If they don’t, you’ll end up with an average or worse team and average or worse results in your organization.

I watched an interview with Mohnish Pabrai. He’s a successful hedge fund investor and protégé of Berkshire Hathaway leaders Warren Buffet and Charlie Munger. Mohnish shares lots of great nuggets in this interview, but his insight that being ethical is a competitive advantage especially stuck with me. This quote was quite powerful:

What people don’t realize is most things in life function on trust. They don’t function based on contracts. If you become very trustworthy it gives you a massive competitive advantage and leg up in life.

So, what is trust? Trust results from having a sense that the other person is driven by things other than their own gain.

Many believe that you must be hard-nosed, have sharp elbows, or only look out for your own interests to be successful. Monish believes otherwise and views being highly ethical as a competitive advantage because once people feel they can trust you, “the world is at your disposal.” Translation: you attract great people and opportunities to you when you’re not just looking out for yourself. The more high-quality people and opportunities you attract, the more money can be made (or, if that’s not your gauge of success, the more you can achieve whatever you seek).

Building trust isn’t an overnight exercise. It takes a long period of consistently operating ethically to build a reputation for trustworthiness. In today’s world of instant gratification and overnight success, this approach may not resonate with some. People who take this path may not find major success quickly, but they can string together a series of wins that continually compound and lead to a long career and outsize success. Warren Buffett and Charlie Munger are ninety-one and ninety-eight, respectively, and great examples of this.

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Today marks the end of my one-hundred-twenty-first week of working from home (mostly). Here are my takeaways from week one hundred twenty-one:

• Proven wrong – I had a hypothesis that I hoped would be proven true. Today I connected with someone credible in the space. During that conversation I realized my hypothesis is wrong. I’m both disappointed and glad I realized this sooner rather than later. Back to the drawing board.
• Unexpected doors – This week was a reminder that you never know who could open a door for you and that there’s more to gain from sharing than from not sharing.
• Outsiders – I spent time thinking about and talking to others about founders and markets situated outside the traditional purview of VC. The more I dig into this concept, the more intrigued I am.

Week one hundred twenty-one was a good week. Looking forward to next week.