Microsoft

You can't abolish the FDA, but you can exit it like we exited the Fed

Balaji argues you don't reform an institution from inside; Google didn't fix Microsoft by becoming Bill Gates, it built a parallel system. You can't abolish the FDA or the Fed, but you can exit the Fed with Bitcoin and build an ethical, fully opt-in parallel system.

“Google didn't reform Microsoft by becoming, you know, Bill Gates. Google reformed it by building a parallel system.”

Steal thisDon't try to reform a captured institution from inside; build a parallel, opt-in system and let people exit to it.

Bitcoin hit $1T in 12 years vs 42 for Apple, 44 for Microsoft

Saylor argues Bitcoin is the most disruptive technology of our lifetime by citing how long it took companies to reach a trillion-dollar valuation: Google 22 years, Amazon 24, Apple 42, Microsoft 44 — and Bitcoin just 12.

“It took Google 22 years to get to a trillion. It took Amazon 24 years to get to a trillion. It took Apple 42 years to get to a trillion. It took Microsoft 44 years to get to a trillion. It took Bitcoin 12. It's a monetary fire.”

Why incumbents leave premium white space: business model and bundling

Rahul Vohra explains why neither Google nor Microsoft built a premium email product: Google's ad model means you are the product so a paid experience doesn't fit, and Microsoft sells through all-you-can-eat bundles where email is just one checkbox in a one-size-fits-all suite.

“For Google, I believe it's the fundamental business model doesn't support creating a premium email experience, and the company is so large now that it doesn't matter. The fundamental Google business model is of course ads and AdWords. It's to know everything they can possibly know about you, secondarily to keep you in the browser, hence Gmail.”

Steal thisFind a premium segment incumbents structurally can't serve because their business model or bundling strategy forbids it.

The 'too big, too small, just right' rocket-ship rule for joining startups

Josh Elman describes joining companies late enough to have momentum but early enough to matter. Microsoft in 1995 was too big (he worked on custom Excel charts among tens of thousands), a 10-person pre-product-market-fit company was too small, and the sweet spot is a company working 'enough' that you can have huge impact and outsized equity.

“I worked on custom charts within Excel. I looked around and there were tens of thousands of other people working on other minuscule things that added up to this giant Microsoft. The next summer, I interned for a 10-person company then called Kartoffelsoft. It didn't quite have product-market fit and it was trying to find its way through. I was like, "Oh, that's almost too small. I want something with a little bit of momentum or where I can tell the story to myself of why it can be giant for the world."”

Steal thisTarget companies with proven momentum but unproven scale: working enough to derisk, early enough that your equity 10x's.

Yammer: 'Twitter for companies' sold to Microsoft for $1B in ~3 years

Shaan recounts Yammer: an internal social network that grew explosively via in-company virality, then monetized by selling admin/oversight tools to bosses once employees were hooked, and sold to Microsoft for a billion dollars about three years in. He says he'd write a $50k check tomorrow to anyone credibly restarting it.

“it got bought for a billion dollars by Microsoft like 3 years after starting. Very quickly, yeah, so it grew super fast, like grew ridiculously fast, 'cause it was a social network inside company, so it had this amazing network effect, amazing in-company virality.”

Give them a football and tell them where the end zone is

A leadership lesson Kagan got in a Microsoft interview: you give people a football, tell them where the end zone is, set the boundaries, and let them decide how to score. The way they get there is up to them.

“He's like, you give them a football, you tell them where the end zone is. You say, hey, here's the boundaries to get to the end zone. How you want to score is up to you.”

Steal thisSet the goal and the boundaries, then leave people alone to figure out how to get there.

Suli quit, got bored, and rode the Facebook platform launch to millions of users

Shaan tells how Suli quit Microsoft, moved home, and the day he quit Facebook announced its developer platform. To knock off the rust he built a silly superlatives app ('which friend ends up in jail'), it went viral to tens of millions of users, and Naval flew him out to invest.

“And so he builds a Facebook app that was stupid. It was like a superlatives app, like which of your friends is most likely to end up in jail or whatever. Boom, goes viral. He ends up with tens of millions of users. And that changed the trajectory of his life where Silicon Valley starts calling him and Naval flies him out to San Francisco and wants to invest in him and shit like that. So he took a bet on the sort of day the platform launched.”

Steal thisWhen a major platform opens its developer API, build something on day one to ride the early distribution wave.

Hiring a Vine star to build the product

The non-technical founders recruited Duke friend Devin Townsend, an ex-Microsoft engineer who had blown up on Vine to 900 million loops. Being both an engineer and a creator made him the ideal person to build a product so fun that talent would do it for free even while getting paid.

“So he was an engineer at Microsoft after college, left, and spent the next year and a half blowing up on Vine, traveling the world. He ended up with 900 million loops on Vine. So in many ways, he was probably the perfect person in the world to build this product because he really understood what the creators needed and how to build a product that was so fun that talent would do it for free, but they got paid.”

Most people wildly overestimate the risk of quitting their job

Sulaiman Ali argues that with sub-4% unemployment for skilled workers, quitting to start a company is low-risk because you can return to a job — often at a higher level, since companies value entrepreneurial experience.

“And I really think a lot— most people overestimate the risk that they're taking when they leave their job. The unemployment rate in the United States is sub-4% for people who are competent and skilled. Build in their line of work, it's easy for them to go back to their job. I think if I quit Microsoft, started a company and failed for a year or 2 or 3, I could go back to Microsoft and actually get a higher position than what I would have if I had stayed”

Steal thisReframe quitting as low-risk: worst case you return to your field, often at a higher level for having tried.

$76K Microsoft salary to a $2M napkin offer in 9 months

Ali was making $76,000/year at Microsoft. Nine months after quitting, he was offered $2 million for his Facebook app company.

“So at the time when I was at Microsoft, I was making $76,000 a year. —so he offered us $2 million for 9 months' worth of work.”

Microsoft job, and dad says quit and start a company

On his first day at Microsoft in 2004, Suleiman Ali called his dad from his new office phone. Instead of congratulating him, his dad told him to quit immediately and start his own company because 'that's where the action is at.'

“And he says, that's all great. You know, cool. You got an office and this is all great that you're excited about what you're doing, but really you should quit your job immediately and start your own company. That's really where the action is at.”

People overestimate the risk of quitting their job

Ali argues most people overestimate the risk of leaving a job to start a company. With sub-4% unemployment, a competent person can return easily, and the entrepreneurial experience often earns them a higher position than if they'd stayed.

“And I really think a lot— most people overestimate the risk that they're taking when they leave their job. The unemployment rate in the United States is sub-4%. For people who are competent and skilled in their line of work, it's easy for them to go back to their job. I think if I quit Microsoft, started a company and failed for a year or two or three, I could go back to Microsoft and actually get a higher position than what I would have if I had stayed”

Steal thisReframe quitting as low-risk: if you fail, your old industry will take you back, often at a higher level for having tried.