The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers

The advice offered by Horowitz in The Hard Thing About Hard Things should be examined within the historical context of the tech boom and bust of the 1990s. The Internet was a new phenomenon, and its potential as a global sales platform was still in the early experimental phase. Many felt that exponential growth was possible. Consequently, as a CEO, Horowitz was constantly concerned about accurately predicting how big his company would grow. The concept of scalability became central to his strategies. Horowitz talks about the size of a company’s various offices and how often the space needs to be expanded. He speculates about the venture capital needed to fuel growth. Nowhere in the book does he discuss maintaining the status quo; during such volatile times, innovation is prized.

Horowitz’s anxiety about accurately projecting growth leads him to over-project what he will need in a management team three years down the road. While startups tend to operate in a perpetual state of flux, those engaged in high-tech activities carry this tendency to the extreme. He says, “In the technology game, tomorrow looks nothing like today. If you survive long enough to see tomorrow, it may bring you the answer that seems so impossible today” (63). This statement implies that making it up as one goes along is the only rational approach to take and that adapting to ever-changing market and industry forces is mandatory.

While such advice may not suit someone who wants to start a winery and must wait years for grapevines to mature, a software engineer operates on an entirely different timetable. Adaptability to change is required not only when living through an accelerated growth cycle; it also applies when the market takes a downturn. On multiple occasions, Horowitz faced the prospect of bankruptcy because his public stock could slip below $1 per share and thereby be banished to the realm of penny stocks. While success was not guaranteed, he attributes his good fortune to his adaptability and willingness to try new things rather than adhering to things that worked in the past. He cites the failures of other dot-coms, situating his success as a proof-of-concept for flexibility.

While the boom-or-bust atmosphere of the dot-com world during the 1990s has largely dissipated, the fact that software engineering relies heavily on creativity and innovation still means that adaptability is a virtue in Silicon Valley. Horowitz recognizes the toll that such pivoting can take on a CEO:

I was sick. I couldn’t sleep, I had cold sweats, I threw up, and I cried. And then I realized that it was the smartest thing that I’d ever done in my career. We’d built something from nothing, saw it go back to nothing again, and then rebuilt it into a $1.65 billion franchise (56).

In short, Horowitz asserts that being part of a dot-com startup is not for the faint of heart, and adaptability to change is mandatory.