What is Reid Hoffman’s Blitzscaling about? What are the nine rules of blitzscaling? Why do the rules of blitzscaling contradict common business sense?
Reid Hoffman’s Blitzscaling is a book about the method of scaling up your business quickly without attention to efficiency. The method is very risky but can produce massive rewards. There are nine rules for blitzscaling.
Continue on for Reid Hoffman’s blitzscaling rules.
9 Counterintuitive Rules of Blitzscaling
Reid Hoffman’s blitzscaling strategy requires counterintuitive actions that contradict common business sense and will feel unnatural.
Rule 1: Embrace Chaos
This is a mindset thing. Get comfortable taking action in uncertainty. You’ll rarely have as much information as you want, and you need to make decisions before you get to that point. Believe that things will get figured out as you take action.
Once you know chaos will happen, be prepared for a variety of outcomes. Have a Plan A, Plan B, and Plan Z (fallback for worst-case scenario).
Rule 2: Hire People You Need Now, Not Later
It’s tempting to keep waiting to hire someone who will be great at a later stage in the company. Then when you reach that stage, that person will be around.
But you don’t need that person now. That’s premature optimization. You need the right person for your current situation. Without the right people here, you might never make it to the later stage.
People tend to have a preferred stage of company they like working in. Few people can excel across the board at being an individual contributor, a manager, and an executive. See if the hire is self-aware of this.
Rule 3: Be a “Bad” Manager
Be OK with breaking best practices of standard management. You might need to restructure the hierarchy of the company 3 times a year, churn through management teams, have unclear career progression for new hires, and retain confusing job titles. This feels like chaos to the team, but having this flexibility keeps the company nimble. You risk the organization in exchange for focusing wholly on growth.
Rule 4: Launch Products Before You Feel They’re Ready
Always launch before you feel the product is fully ready. Otherwise, you’ll waste time building things no one cares about.
Don’t cross the line so far into having fatal flaws that endanger your customers or reputation. Hoffman says paid consumer products have the least room for error, since they’ll expect products to be nearly perfect and will complain publicly about flaws.
Once you launch, listen to the data more than anecdotal user feedback. People are bad at articulating what they want. Look at how they’re using your product to know what they really feel.
Rule 5: Leave Small Problems Unsolved
You’ll have a host of problems to solve. You need to triage them.
- Deal with urgent systemic risks.
- When an Airbnb host went public about how her house was trashed by guests, it risked triggering systemic pullbacks by other hosts. The company quickly instituted an insurance policy to reassure hosts.
- For important but not critical problems, put in a hack fix, and commit to solving it later.
- Punt all other issues.
If someone wheels into the ER with a gunshot wound, you don’t cut out a suspicious cancer you find along the way.
Hoffman considers issues in this order of descending importance: Distribution > Product > Revenue model > Operations > Competition > What’s next?
- In general, each top one solves all the other bottom problems. Being able to acquire users gives you data to improve your product, which drives revenue, which gives funds for operations, and so forth.
- Inversely, if your distribution/marketing is threatened, then your entire business is threatened, and you need to fix this as a top priority.
Another question to help find issues worth fixing: “which issues will be impossible to fix later?” Choose literally impossible things, not just very difficult things.
Rule 6: Do Things that Don’t Scale
Paul Graham’s original essay by this name argues that the founders need to put in a lot of elbow grease to recruit users, hire, run operations, and understand what makes a delightful customer experience. (An example is Airbnb founders taking photos of rooms themselves so they could quickly find out what worked before making it a scalable operation).
Hoffman extends this concept to mean do things that temporarily fix the issue that might have to be fixed later, in the case of a success. Write throwaway code. Don’t build QA tools. Don’t prepare your technology to scale to a million users, when you barely have 10.
Rule 7: Ignore Customer Complaints
Customer complaints may be one of those fires you let burn so it doesn’t slow you down.
Offer light support to customers, or possibly self-service support only.
(Shortform note: this advice can contradict other startup advice to keep your customers as happy as they can, since your early customers might make a huge difference in long-term reputation and virality.)
Rule 8: Raise Too Much Money
You’ll underestimate the number of difficulties you’ll run into. When you raise money, you’ll tend to raise for a best case scenario. Then when you run into difficulties, not having enough money might kill your company.
Hoffman advises to raise like you’ve got only half the amount you currently have in the bank.
At the same time, spend money judiciously, only to fix things on the critical path to reach the next phase of scale.
(Shortform note: again, be aware of the incentives of a VC telling you to take more of their money.)
Rule 9: Evolve Your Culture
Culture is a shared way of doing things. It helps people make the right decisions autonomously. Unclear, hazy cultures get in the way of implementing strategy.
The company is like a Ship of Theseus, the paradox that describes a wooden ship that has all its planks replaced over time – when no original plank returns, is it still the same ship? Likewise, all the people in your company may change, but the company should stay the same culturally. Employees should be aware they have responsibility for re-creating the culture as it grows.
Every employee should have answers to these questions:
- What is your organization trying to do?
- How are you trying to achieve those goals?
- What risks are you taking to achieve those goals more quickly?
- When you have to trade off certain cultural values, which ones will you keep, and which will you discard?
- What kind of behavior do you hire, promote, or fire for?
To promote the cultural values regularly, consider office design, written memos, communication channels (e.g. weekly emails, Netflix culture deck).
Don’t hire so narrowly to fit a stereotype that you end up having groupthink. Hire people who are additive to your culture.
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Here's what you'll find in our full Blitzscaling summary:
- How to build a company that grows to a large size very quickly
- Why you have to ignore efficiency and profit for speed
- How companies like Facebook, Uber, and Airbnb were able to blitzscale