← Success Story with Scott D. Clary
Success Story with Scott D. Clary
Lessons - How a Traffic Jam Became a $1.1B Company | Uri Levine - Waze Co-Founder (Sold to Google)
00:11:19
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- [00:00]
A
In this Lessons episode, explore how entrepreneurs balance persistence with knowing when to walk away from a venture. Discover how to treat product development as a series of experiments to find what works. Understand when to shut down by recognizing a disappearing problem or misaligned team, and uncover why falling in love with the problem creates clarity, resilience and long term success. I just wanted to ask you something about failures because you mentioned something very important. Failing fast. So in that startup that failed, how did you know when it was time to call it quits? How do you fail fast? How did you fail fast?
- [00:41]
B
So let's separate between shutting down a company and failures or errors or mistakes throughout the journey because the journey is very important in the sense that you have everything that you would have in your roadmap. For me, it's a list of experiments that you're going to conduct and you will try with the first one that you think that is going to work and you will end with the first one that is actually working. There is a nice story that I heard about LinkedIn. I don't know how true it is, but for a second I would say let's assume for a second that it's true and if it's not true, then assume that it is true for the sake of the discussion, right? And when LinkedIn started, they actually had 30 features that they wanted to develop. And they basically say this is the minimum product. And when they started to meet investors, everyone told them that 30 features is way too long and they need to reduce that list to less than that. And they ended up with a list of 10 features that they said, this is, you know, we cannot even launch the product without those 10 features. Obviously LinkedIn started and eventually they were becoming public and then acquired by Microsoft and then becoming public again. But the first time that they went public, how many of those 10 features they actually developed? And the answer is one, just one. So in that sense they were lucky that they figured out the first feature that they need to develop at the beginning. I don't know how true this story is, but. But for the sake of the discussions, let's assume that it is. The roadmap is eventually a list of features that you're going to develop and each one of them has an objective to figure out product market fit. And if they do, then the product development is done and if they're not, then you try another one. And that is the important part of the failures, right? So you don't stick with something that doesn't work. You keep on trying, you keep on trying different Things for the question, when do you know that it's time to shut down a company? Look, you eventually fall in love with the problem and once you start to build your team, this is your mission in life. You will never give up and never giving up. Perseverance is the most important behavior of an entrepreneur. Not necessarily of a CEO, but of an entrepreneur. They don't give up. And if you would ask me, how do you know that it's time to give up? So number one, you never know. You don't know. Number two, I would add my advice that is basically saying, look, if one of the two following is happened, then you should give up. One is that the problem disappears. The first startup that we started in year 2000, it called Access Mobile and what we tried to do is actually provide an email access through WAP phones, right? So very, very long time ago. And the problem disappeared as soon as BlackBerry started, right? So there was sort of a very different approach for the solution which made our solution irrelevant. And to a certain extent I would say the problem disappeared. So if problem disappears, you should quit. The other reason is if the team is not right and you're unable to change that, if you are the CEO, then you should be able in a position to change that. But in many cases you don't, then you end up with a place that might have the right mission but not the right DNA. And you don't want to stay in a place like that. So this is time to shut it down. These are the only two reasons that I can figure out why you should quit. And. In general, I would say, look, entrepreneurs, they don't give up.
- [04:52]
A
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- [08:40]
B
And I would say, and I'm stopping you for a second, think of the following, right? When you go into this journey, there is a problem that you are trying to address. And this is becoming your mission. So for a second, I would say if the mission is right and the team is right, then you shouldn't give up. If one of them is going away, then you should start to consider. If both of them, then definitely you should consider to, of giving up. But the, the journey of failures is not about the essence of the startup. The essence of the startup is about the problem they're trying to solve, the value that they're about to create, and it's about the way to get there. And the way to get there is a journey of failures.
- [09:29]
A
Understood? I understand. Okay. I want to understand the, the title of the book that you wrote, Fall in love with the problem, not the solution. So we're dancing around this now, but speak to me about what it means to truly fall in love with the problem. What problem did you fall in love with when you built Waze?
- [09:49]
B
I hate traffic jams.
- [09:52]
A
It's a good problem.
- [09:53]
B
You know, at end of the day I, and I'm pretty sure that you have met many entrepreneurs, they all have a starting point that has that touch them on a personal level. Right. And not all, but most of them. And in many cases this is about frustration. So you run into something and you ended up being frustrated. And then you tell yourself, no, no, no, this is something that I'm going to change. There is no way that this is how it works. And this is the key driver for Most of my startups is running into situations that I tell myself, wait a minute, am I the only one that is getting frustrated because of that? And then you start to discuss that with or speak with other people until you realize that this problem is real, or at least the perception of the problem is real. And so for me, you know, the journey is always about starting with a problem. So finding a problem, a big problem, something that it's worth solving, something that the world will become a better place if we solve that. And then the next thing that you really would like to do is ask yourself, who has this problem? Now, if you happen to be the only person on the planet with this problem, then I would say, go to a shrink. It's much cheaper than building a startup, right? But if a lot of people actually have this problem, then go and speak with those people and understand their perception of the problem, and only then build a solution. Now, if you follow this path and your solution works, it's guaranteed that you are creating value. If you start with a solution, you might be building something that no one cares, and that's really not a good idea. So when I say fall in love with the problem, what it really means is start with the problem. But there is way more into that. The problem then remains the North Star of your entire journey. And every day you're asking yourself, if I'm making a progress towards addressing this problem. If the problem was for ways. The reason that we start is that we hate traffic jams. We evolved that into a mission to help drivers to avoid traffic jams. Because the solution for the problem is. Is very easy, avoiding the problem, right? So getting rid of the problem problem disappears, or we are avoiding that or overcoming that. And that makes it easy. As long as you keep that as the North Star of your company, then you increase the likelihood of being successful. And you increase the likelihood by basically saying, I know where I'm going. I don't know what's the next step. Or I do know what's the next step, but I have no idea what's the step after next. But I know where I am going. The other part of it is that it makes your story so much easier to be told, that your marketing is becoming easy, your fundraising is becoming easier, Everything is creating or the entire story is much easier. Because if I will tell you, I'll have a time machine. We will roll back in 2007 and I will come into this podcast. Well, that podcast wasn't here, I think in 2007 it wasn't, but I get the point, but assume that we are and I will tell you I'm building an AI crowdsource navigation system, then you don't really care. But if I will tell you I'm helping you to avoid traffic jams, then all of a sudden you do care and so the story is easier to be told. And usually story you know, when you tell a story about the problem, then there is an emotional engagement for many of the people in particular if they have experienced similar problem or the same problem. So fall in love with the problem essentially increase your likelihood of being successful. Increase the likelihood of becoming a market leader through two main things right the North Star and therefore the mission of the companies is clearer and easier and remains the same throughout the entire journey. And the story that you tell is much easier.
- [14:14]
A
Thanks for tuning in. If you found this valuable, don't forget to hit that subscribe button so you never miss an episode. And if you want to dive deeper into this conversation, check out the links in the description to watch the full episode. See you in the next one.