Why We Are All Getting the Wrong Advice From Basecamp?
Like everyone, I was a fan of Jason Fried and DHH’s writings. I still like their style of writing. It is very lucid, jargon-less, nod-worthy style of writing. Their attack on VCs and VC funded businesses are legendary and was refreshingly new.
When Elon Musk says working 80 hours a week is needed to change the world, Jason Fried’s appeal of working 4-days a week in summer is good enough to make money; you cannot ignore it.
But nowadays, I think, the guys at Basecamp don’t talk about their privilege or their core strength. In my opinion, all they have been arguing so far is the frills.
Advice on how to work is secondary, but what to work on is the most important one. DHH and Jason loudly talk about how to work; they critique about open offices, a culture of death by meetings, working in a calm company, remote work is the best way to work, blah, blah.
They can experiment all this in their work because they got something fundamental right. Basecamp is a project management tool, with huge market size. It is company-size or industry agnostic. It has got an excellent product-market fit.
Most people struggle on “what to work”, because of which their “how to work” gets affected. But what DHH and Jason talk about is the toxicity of VC funded companies like Uber and Facebook. The most delicate thing here is that they may be right in their opinions about some of the VC-funded companies.
But many people I know romanticise Basecamp’s way of work as the best thing they have discovered but ignore their core strength. For all the noise about bootstrapped businesses that Basecamp makes, do you know which celebrity CEO owns a share of Basecamp? Are you aware that both DHH and Jason de-risked themselves with that money?
(If I had made an impression that I hate Basecamp, let me clarify, I don’t. I still use Basecamp passively at work. I love DHH for his excellent book recommendations, his take on parenting, candid opinions on everything and his Twitter fights. I love Jason’s writing style, and I even listened to the recent podcast with Shane Parrish. They used to sound like warriors for me some years ago but not anymore.)
Jeff Bezos owns a small share of the company. In DHH’s words itself:
Especially in the early years, before our bombastic views on venture capital, the IPO rat-race, and other ills of funding were known. We had, I think, close to 50 different VCs get in contact. Ironically, part of what did give us the confidence to turn down that whole world was a small sale of equity to Jeff Bezos. That gave our personal bank accounts just enough ballast that the big numbers touted by VCs and acquisition hunters lost their lure.
In a country like India, where there is cut-throat competition and extreme inequality, the inspiration to be bootstrapped or work only for 4-days a week in summer might not be right at all.
Yes, VC investment or any investors with their money will have an undue advantage over the makers or the entrepreneurs. The idea of shunning the investment is wrong. Instead, we need to have mental frameworks on evaluating the right investor for your company or assessing the value promised vs value provided by them.
Bootstrapping a business is not sexy. It has a lot of hidden costs that can take a toll on the entrepreneurs and their family. As Charlie Munger says, “Avoid intense ideology because it cabbages up one’s mind.”. Making business decisions or building a company with such an ideology, may be wrong.
I strongly suggest reading this and this, some excellent arguments by Justin Jackson. It is worth your time.
Thanks for reading.
Fetishism About Product Management
I see a trend of people wanting to become a product manager and changing their career towards product management. In a sense, it is a good thing. More people becoming product-conscious and adopting a product-centric-mindset, is a better thing for the ecosystem/industry.
But in a way it’s terrible. I mainly blame one my heroes, Ben Horowitz, for this problem. I want to explore this in detail.
I believe, there are two core skills needed for any industry/company to make money: building things and selling things.
Yes. It may sound dumb, but it is that simple.
I started my career as a programmer, and I took pride in building things. My love for computers started from school, and I spent 15 years of my life in learning languages, technologies and architecture frameworks to build and ship things. Like many in my programming clan, I used to look down on marketing and sales folks. I thought the programmers were the centre of the universe and every other function was merely benefitting from the tech folks.
I came out of that bubble after my stint as an accidental product manager. I understood my blindspots and why my worldview of an ego-centric tech person was wrong. It was almost ten years ago when I got an opportunity to be a product manager. I didn’t have any books/articles/blogs on what product management was, what they do and how it is done in different companies.
It was during that time I came across this article, Good Product Manager / Bad Product Manager, by Ben Horowitz, who had codified this based on his stints as a product person.
I was MINDBLOWN after reading this, and it was my bible for some years. Which I think was one of my biggest mistakes.
Ben Horowitz’s writing was a seminal piece in inspiring people about being a great product manager. Till date, it is one of the best blogs about product management, where reams and reams are still written on this.
In that, Ben writes this:
A good product manager is the CEO of the product. A good product manager takes full responsibility and measures themselves in terms of the success of the product.
IMO, this analogy of a PM being a CEO has been received in a different light by many people.
Many people think PM is a person like Jobs or Musk like a cult leader. But in reality, PMs are people with very less number of people reporting to them (Group PMs and VP of Products are a little different), and they need to influence without authority.
John Cutler, one of the excellent writers about Product Management, says this:
The more you get into the business of … resource-juggling, herding, acting as a facilitator, or “managing” the more you’ll start wearing the wrong set of hats. Your team will start relying on you for something that they can, in most cases, do for themselves.
Des Traynor, co-founder of Intercom also shares this point of view:
I think articles talking about them being mini-CEOs have over-glamorized the role a little. People think product management is shit like you see in A Beautiful Mind, where they’re staring into a park and writing some breakthrough thoughts on a window. Or that they possess a Steve Jobs-esque type of product intuition, where decisions come easy, and influence comes for free. None of this is true.
On Nature vs. Nurture
When it comes to parenting an important concept I learnt some years ago is the “nature vs nurture”. Nature is the genetical influence given by the parents to the children. Nurture, many people, used to assume the way you bring up the kids. One may be a helicopter parent, tiger mom, idle parent or whatever principle we read and aspire to be. The research and excellent work by Judith Rich Harris in her seminal book, says it is not true.
The world that children share with their peer group, be it in school or other circumstances, is what influences and moulds their behaviour. It has a significant impact on the kids than the genes or our methods of parenting.
I have read this in theory, and I have always been sceptical as I have not seen in action in my son - till now.
My son is seven years old. He goes to a Montessori school. Like any parent, who wants to do the best for their kids, we took the oft-beaten path. Yes, Montessori, is still a fringe, non-mainstream thingie in India (or at least in Chennai). Long story short, I used to think of being very particular about the method of education is crucial. I even still believe so.
But what is astonishing for me was the influence of the peer group on my kid’s behaviour and learning. Yes, I don’t mean to say parenting doesn’t matter. The intrinsic motivation and inspiration that my son derives from his peer group is terrific.
My son was never enthusiastic about sports or outdoor activities like running or jogging. Just by playing with a group of 4 or 5 kids in my apartment community, he is very enthusiastic about cricket and running. The effort he puts in becoming a better runner or changing his food habits for running was astonishing. My son has been a selective and fussy eater, but after this running craze, he asks for protein-rich foods and vegetables. We never succeeded in our attempts for vegetables and proteins in the pre-running era.
It is the same as reading books as well. My son is a curious kid but never showed much interest in reading. That changed after interacting with two kids at school, interested in reading and learning things faster.
TL;DR version of my learning is: Parenting style matters but equally important is the influence of peers in their behaviour. As they say in the behaviour improvement literature, the environment has a much more significant impact, so better be conscious (and also picky) about it.
Why I Dislike “Deep Work” ?
I want to talk about the book written by Cal Newport, Deep Work. It is a big hit and many people I know vouch by this and are planning to adopt this. Well, I was a convert to Deep Work too but realised the repercussions of it and changed my ways.
Deep Work is the meaningful or essential work that you have to do in a day, with very less or zero distractions. The deeper you think or immerse into the work, you get the compounding effects in the quality of your work.
So far it is good. But the means to do the deep work suggested by the author is problematic. Cal says that you need to quit social media, if possible. If not, limit social media. He goes into the romanticisation of his non-usage of social media, like listening to baseball games only on radio and not reachable after work in mobile or email. Here are my arguments:
Social Media Is Not Bad - Mark Zuckerberg doesn’t wake up every day and plots with Sheryl Sandberg and team on how to distract us and sell more ads. No. Ad-supported businesses like newspapers or magazines are probably more than a hundred years old. I have seen many older members of my family connect with their schoolmates and collegemates after getting on to Facebook, which wouldn’t be easily possible before the social media era. The satisfaction and joy in the eyes when they discover their old mates is so good.
We shape our tools and then our tools shape us - Yes, addiction to social media is a problem. But as a human species, we are still learning to deal with the abundance of information flow and how to moderate our media consumption. Soon, in a few years, we all will be skilled and equipped on handling the barrage of feeds from Instagram to Facebook to WhatsApp. I also think the tools will also become better in helping us to spend time well because it is in their vested interest that we don’t quit.
Master the media and leverage it - Recently, I had a reunion with my school friends after 15 years. (I was very active on Facebook before I took a sabbatical after reading Deep Work). Every friend I met in the reunion was very familiar with what I have been doing, reading and sharing. Many even came asked why I am not part of Aam Aadmi Party (AAP) like before. I used to think; nobody gave a damn on the things that I write and share. Even though people don’t click on Like or Comment, they do read to be in touch or know what’s going on. (Very similar to @haideralmosawi post here)
Better ways to do Deep Work exist - This is the most important revelation for me. I came across very well-read and incredibly talented people like Tiago Forte and Venkatesh Rao, who like the concept of deep work, but detest the approach preached and more importantly has suggestions on how to do it better.
I will try to write in detail in the next posts on how to do Deep Work by leveraging social media. I want to part with this quote from the legendary investor, Bill Gurley:
Twitter is the most amazing networking and learning network ever built. In any given field, 50-80% of the top experts are on Twitter and they’re sharing ideas. If you’re not using Twitter, you’re missing out.
Key Lessons From Rebel Allocator
I want to go in detail in a later post about this nicely written fiction, Rebel Allocator. I am half way through it. This post is about my key lessons regarding business from this fiction.
In order for a business to thrive, the value delivered to a customer has to be greater than the price the customer is charged, which has to be greater than the cost of the goods or service. Value is greater than Price which is greater than Cost.
This above may sound very simplistic but a very good summation of how a business needs to be. The difference between the price and cost is the profit a business makes. The difference between the value and the price is the brand a company has.
The next lesson ties up these two entities in a very nice compressed but in a pithy manner:
Be the cheapest. Be the most convenient. Or be the best. Good companies aim for at least one of those objectives. Great companies find a way to achieve two. Doing all three is a rarity.
The above two lessons are a quite simple but extremely powerful way to judge a business. I find this interesting because, as a personal finance newbie, I really find it tough to assess or value a company or business. I have taken baby steps in understanding how to value a business or a stock. I want to understand how to know, what is a fair value for a stock. In that journey, Rebel Allocator is a very good start. An extremely well-written business-fiction about business, similar to Eliyahu Goldratt’s Goal.
Skin in the Game
Skin in the Game is my first proper book of Nassim Taleb. I have seen him being notorious on Twitter for his fights and blocks. I have heard him in a couple of podcasts and have read a short book, Bed of Procrustes, a chuckle-worthy collection of aphorisms and quirky writing.
I am no fan of Taleb and also not a hater of him. Since I haven’t read his works fully, no point in being one extreme. But things have changed since I started reading SITG (Skin in the Game).
I started reading it because of a very high recommendation from a colleague. I have always known him as a polarizing figure. People I follow in Goodreads either love this book or hate this book. If someone evokes such a response, that is enough for me to kindle interest in this. So I started reading and finding it as a slog to complete it. I want to have Taleb in very small doses over this week, instead of usual gorging in a weekend.
Taleb is refreshing but tedious at some times, sweepingly-generalizing but terrific at many places. His punches at many of his enemies are rip-roaringly hilarious, even though it lacks civility (by who cares about civility these days).
I have completed only 6 chapters of his book (SITG), but I definitely read to know more about what he says and what he really means. His observations on the common people’s commitment to work whereas the people at higher level goes scot-free are definitely worth it.
I am still not a fan of him but I don’t hate him either.
What is your opinion about Nassim Nicholas Taleb? Do you have any stories to share?