Book Review: The Hard Thing About Hard Things

One version of a business book – the kind I don’t recommend – consists of a series of Powerpoint-ready bromides matched to business anecdotes and sports analogies about achieving success, explaining the keys to the author’s path. The author did well, here’s the path, so you should try it as well.

A better version of a business book[1] – and Ben Horowitz writes The Hard Thing About Hard Things in this mold – is to describe all of the mistakes, sleepless nights, and layoffs endured on the way to success. This has the virtue of being a truer version of events, and a more realistic guide to the entrepreneur on the difficult journey.

I do recommend this book.

The first one quarter of the book – his origin story – is the most exciting and best written. After an early career of moderate success as an engineer at Silicon Graphics, NetLabs, and Lotus Development, he applied in 1995 for a job at Marc Andreessen’s startup Netscape. Following that extraordinary success and crashing failure, Horowitz went on to lead a company called Loudcloud.

He tells exciting stories about that painful experience, which flamed out, only to rise from the ashes as Opsware, which sold to Hewlett Packard for $1.6 billion. After that, Horowitz joined again with Andreessen to lead the venture capital firm Horowitz-Andreessen.

ben_horowitzI have my own origin story about flaming out in a painful way, and seeking redemption. Unlike Horowitz, I did not then go on to lead my lost-for-dead company to a billion-plus valuation and parachute into being a leading venture capitalist.[2]

Horowitz never sugarcoats the role of leading a company as CEO. The remaining three-quarters of the book – which appear to be a compilation of blog-post advice on business leadership – continue the theme of difficult times.

Some highlights:

  • Expect multiple incidents of declaring WFIO (We’re Fucked, It’s Over)
  • Leading sometimes means “choosing between horrible and cataclysmic.”
  • The decisions that lead to inadvertent politicization of the office
  • On firing employees the right way
  • Shortcuts in management that lead to huge problems later

 

Horowitz is funny. He’s willing to tell stories about his failures, which is endearing.

He insists on headlining chapters with hip-hop epigraphs, which is either a terrible affectation or honestly come by. I don’t know him, so I can’t judge.

hard_thingHe lapses into more clichés and business bromides in the latter part of the book. When confronting problems, Horowitz notes, “focus on the road, not the wall.”

“When someone learns to drive a race car, one of the first lessons taught is that when you are going around a curve at 200 mph, do not focus on the wall; focus on the road. If you focus on the wall, you will drive right into it. If you focus on the road, you will follow the road. Running a company is like that.”

Ok, whatever. That is typical business book/sports analogy bullshit, even though we know what he’s trying to get at. I’m so tempted to write a Jack Handey version of that.

Anyway, just focus on the first quarter of the book. It’s exciting. You could read this as a “how to be a CEO” book, and as such it’s a great series of warnings about how difficult it will be, how often you will screw it up, how many sleepless nights you’ll endure, how frequently you’ll be winging it and hoping for the best. Horowitz has deep credibility and good stories.

 

[1] The best version of a business book – which I would like to write some day – is from the businessperson who simply writes about his failures as a kind of counter-guide. A “How Not To Invest” or “How Not To Start A Business” guide. I don’t know if I could ever get this sold to an editor, but if you know someone who wants that, hit me up with a DM. I’ll send you an outline of the book.

[2] Other than that, though, very similar trajectories.

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In Praise Of Dirty Jobs

railcarIf you have a fancy educational background, the tempting thing is to go into a glamorous field, full of smart people with equally good educations. Maybe investment banking, consulting, or a stint with a hedge fund? I tried all that. Because I’m a slow learner, I realized late that there’s got to be a better way. It took me a while to figure out the following: Dirty jobs might be a smarter bet for making money.

What I really wish I could do is invest in my friend Bryant’s business, but I’ll tell you his story as maybe it helps you make money starting or investing in your own business.

Bryant’s Ivy League education initially took him to book publishing in Brooklyn, which – while not as lucrative as other high-status jobs – is definitely full of bright shiny minds. Then a buddy lured him down to the Eagle Ford shale in South Texas in 2007, and he’s been knee deep in the oil field services business ever since.

I took a field trip 30 minutes south of my house where Bryant is currently building a new oil-field services business, called CRU Railcar services.

Railcar cleaning

He and his boss got inspired because they move sand into the oil field in South Texas via rail, and they found existing services to periodically clean their train cars expensive, slow, and unreliable.

ivy_leagueHere’s some background on cleaning railcars: Railcars that move the products of the oil and gas business have to be cleaned before being used for carrying anything else and/or before being put into storage. If the railcar previously hauled diesel but will convert to move heavy sour crude in the future, then a professional cleaner has to completely scour the inside of the car. If the car moved propane before but will be retired into a rail yard for storage, the whole thing has to be cleaned as well.

This is a dirty job. It’s also dangerous, scary, and complicated.

During our visit, Bryant and his team of five other roughnecks all wear the company uniform: The left-pocket nametags stitched on nylon with reflective safety stripes give them a look somewhere between an Astros throwback jerseys and a bowling team. It’s the kind of thing his book-publishing hipsters buddies might wear in Williamsburg, Brooklyn, but for them in a totally ironic way. There’s no irony to Bryant’s pret-a-porter style. This job kills.

Two cleaners in Illinois died after succumbing to fumes in 2014, while another two in Nebraska were blown up in 2015. Materials left inside the cars are highly explosive. Two brothers in San Antonio died in June this past year after inhaling fumes inside a tank car they were cleaning.

A Houston Chronicle investigative report in 2014 found the tank cleaning business highly risky, with the main regulatory agency OSHA unable to keep track of cleaning companies or their safety standards.

In reading reports of accidents on the job, a haphazard approach to risk appears common.

Bryant’s attention to detail when it comes to risk, by contrast, impressed the heck out of me.

Bryant walked me through the process he’s created for cleaning fuel cars.

First, they assume the air inside a fuel car is totally incompatible with human life. All cleaners breathe only from oxygen tanks, like scuba divers under water. As a backup, they carry 5-minute emergency tanks in the event of a failure. A spotter stands over a hole in the top of the train car at all times, watching for any signs of trouble. The spotter stands next to a crane for lifting an unconscious body, while an electronic monitor for air toxicity runs at all times. In addition to the spotter, a rescue person stands by, with his own oxygen supply at the ready, in case of trouble. That covers the air problem.

Then there’s the explosion problem. To hack at dried petroleum that might cake the fuel tank floor, the cleaners use a spark-proof shovel. Shovels are just one method.

Train cars arrive in a wide variety of dirty states, having carried any number of oil and gas products. In tests, Bryant’s team has found that only trial-and-error can determine what cleans the cars best. Sometimes a splash of diesel loosens up the gunk.  Sometimes a high-pressure water hose that would cut your limbs off works best. Sometimes, he reports, the simple household cleaner Dawn is magically effective.

Seek dirty jobs

Thomas Stanley, author of bestselling personal-finance book The Millionaire Next Door urged “dirty jobs” for successful entrepreneurs. Stanley tells the story of junk-yard owner Richard with his $700,000 annual income and $10 million net worth as the quintessential model to follow. Seek businesses with that might have little to no competition, Stanley urges, because they lack the prestige that attracts the brightest minds.

Many things will determine the success of failure of your new business venture: The cost of materials, your ability to make the big sale at the right time, the difficulty of finding investment capital, your skill in hiring and retaining key people, and of course the sign of the zodiac under which you were born.

But one of the things that could save you – as you screw up everything early in your business venture – is the quality of your competition. In a sense this is just another restatement of the old “bear and the two hunters” joke. You don’t necessarily have to outrun the bear, you just have to outrun your competition. If you can choose a field where the competition is thin, you’ve got a good chance of thriving.

Bryant’s railcar cleaning business is dirty, dangerous, claustrophobic, and complicated. I would not do it for anything in the world. I also have a hunch they’re going to clean up on the competition and make a lot of money.

 

A version of this ran in the San Antonio Express News and the Houston Chronicle.

 

Please see related posts:

Audio interview – My buddy Bryant on fracking jobs, plentiful and rough

Book Review The Millionaire Next Door by Thomas J. Stanley

Book Review The Millionaire Mind by Thomas J. Stanley

Audio interview – Gary Sernovitz on Fracking

 

 

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