Build

Key idea 1

Use your early adulthood to do as much as you can, fail, and learn from it.

Are you familiar with the first company that developed a product similar to the iPhone? If you immediately thought of Apple, think again. Although not called the iPhone, this product was known as Magic Link and shared many features with today’s smartphones, including a touchscreen, email, apps, games, and even animated emojis. Released in 1994 by General Magic, it turned out that people at that time had no interest in it, considering it more of a geeky toy. Despite the product’s failure, Tony spent four years working with General Magic on the Magic Link, a period he doesn’t regret as it helped him discover his true passion. Despite the long hours he dedicated to the project,

Tony found fulfillment in his work.

While the book doesn’t recommend such extreme dedication, it acknowledges that when we find our passion, we tend to immerse ourselves in the work, sometimes putting in extra hours, including weekends and holidays, to learn as much as possible. Early adulthood is presented as an opportune time to take significant steps toward career goals, even if there are inevitable setbacks. The only real obstacle to success is inaction, as choosing not to embark on any path prevents the discovery of one’s true interests.

Taking risks and exploring various career options during early adulthood is encouraged, given the likely absence of significant family responsibilities and assets at this stage. Following Tony’s example, if you’ve identified work that brings you joy, it’s advised to pursue it. Once Tony discovered his passion for smartphones, it led him to Apple, where he contributed to the development of the iPod and later the iPhone.

After identifying your passion, the next step is connecting with like-minded individuals. Building friendships, finding a mentor, and securing a job are emphasized as essential in making a meaningful impact on the world. It’s acknowledged that aiming for the stars may not be immediate, but clarifying what you want to learn and the people you want to work with sets the foundation for discovering the necessary resources to build what you aspire to create.

Key idea 2

Managing a team is all about steering it in the right direction without micromanaging.

Steve Jobs possessed an intricate attention to detail, exemplified in his literal use of a jeweler’s loupe to scrutinize individual pixels on a screen for flaws in the user interface graphics. Jobs insisted on perfection in every pixel, component of the product, and even the wording on the packaging. While some might label this behavior as micromanaging, Tony views it differently, considering it an essential aspect of effective management. According to him, such meticulousness sets a standard for the level of care and precision expected from the team, preventing any descent into mediocrity.

Tony emphasizes that managing involves a shift from individual contributions to helping others excel in their previous roles. If a manager finds themselves predominantly performing their previous tasks, it signals a potential issue. To maintain focus on management, the advice is to concentrate on desired outcomes, such as creating an excellent product, and delegate responsibilities for specific processes like product development, design, marketing, and sales to capable individuals. The manager’s role is then to allow the team to leverage their strengths.

Regular meetings serve as checkpoints to ensure progress towards top milestones. Managers should have a clear understanding of the necessary actions to achieve these goals. Alongside tracking milestones, it’s suggested that managers maintain a list of concerns related to each project and team member, identifying areas that demand more attention. Additionally, managers are encouraged to keep a section for ideas, whether for product improvement or enhancing the team’s work-life balance. This list not only serves to inspire and excite the manager but also communicates to the team that their input is valued. Tony underscores that a crucial aspect of management involves sharing the mission and passion with the team.

Key idea 3

When advocating for your product, always focus on the “why.”

In 2007, Steve Jobs delivered his iconic speech on the iPhone, unveiling its innovative combination of a widescreen iPod, mobile phone, and internet communications device. While this part of the speech is widely remembered, Jobs also addressed the perceived shortcomings of existing smartphones and regular mobile phones. He skillfully applied what Tony terms the “virus of doubt,” highlighting common user frustrations and inconveniences, ultimately paving the way for a solution—hinting at how the iPhone could address these issues.

Tony underscores the importance of storytelling in product presentation. Even if you have a cutting-edge product, effective storytelling is crucial. Competitors with better narratives may emerge as winners. Therefore, the focus should be on the “why” of your product, backed by a compelling argument. If you struggle to identify a strong “why,” it may indicate that your product idea is not as great as initially thought.

Tony outlines three essential components of a truly great product idea. Firstly, a clear “why” is crucial. Secondly, the product should address a widespread problem faced by many. Lastly, the product concept should be based on an idea that remains compelling and refuses to be dismissed, even if the production process seems challenging.

An analogy is drawn between product ideas and painkillers versus vitamins. The best ideas function like painkillers, providing immediate and noticeable relief to a specific problem. Unlike vitamins, which are nice but not essential, painkillers are indispensable. Before committing to an idea, it is advisable to observe if it remains persistent in your mind. Some ideas will fade over time, while others will persist—those are the ones worth concentrating on. Tony’s own experience highlights this, as it took him ten years to progress from contemplating a smart thermostat to creating Nest.

Key idea 4

Hire a diverse team, and hire carefully.

Isabel Guenette embarked on her journey with Nest at the young age of 22, fresh out of college. As one of the initial hires by Tony and his co-founder, she was entrusted with crucial research tasks related to thermostats, tackling numerous questions that remained unanswered at the time. Despite both Tony and Isabel lacking extensive knowledge about thermostats, her youth, curiosity, and competence allowed her to confront the challenge directly. This led to her rapid advancement within the company, eventually becoming a project manager and playing a pivotal role in the product’s development.

Isabel’s youth was a significant asset as it enabled her to approach the workload with confidence and without hesitation, traits that might have been daunting for an older individual. As a company progresses, the necessity to expand the team arises, and Tony emphasizes the importance of building multigenerational teams. This includes hiring individuals in their 70s, enriched with wisdom, as well as 20-year-olds who bring fresh perspectives and abundant passion. Despite the longer training period for younger hires, they are viewed as an investment in the company’s long-term success.

Diversity is also highlighted as a crucial factor in team growth. Tony advocates for hiring individuals with diverse backgrounds and identities, offering an opportunity to deepen the company’s understanding of the world and its customers. However, an effective hiring process is essential, as many conventional practices are deemed inadequate.

To ensure the right hires, Tony recommends having relevant team members participate in the interview process. For instance, if hiring an app designer, involving an engineer in the interview board can be valuable. Establishing ground rules is crucial, exemplified by Nest’s “no assholes” policy, which disregards candidates displaying arrogance, control issues, or dismissiveness, regardless of their qualifications on paper.

Identifying the suitability of a candidate involves probing deeper during interviews. By questioning candidates about their reasons for leaving previous jobs and their actions in challenging situations, you can gain insights into their character. Simulating real-life work experiences, such as collaborative problem-solving on a whiteboard, can further reveal a candidate’s thought processes, communication skills, and empathy. Tony stresses that hiring is not just about filling immediate roles but also selecting individuals capable of addressing both current and unforeseen challenges in the future.

Key idea 5

As CEO, push your employees to do their best and avoid coddling them.

Congratulations, you’ve reached the pinnacle of the corporate hierarchy – you’re now a CEO. This role entails overseeing the entire company, managing relationships with the board, cultivating professional connections, and ensuring your team continues to innovate. However, you might find yourself wondering how to navigate this challenging position.

The reality is, there’s no foolproof way to prepare for the role of a CEO other than actually assuming the position. Even if you’ve held C-suite positions before, being at the helm as a CEO is an entirely different experience. Your concerns as a CEO align with those of your company, and your primary responsibility is to care about everything.

In the role of a CEO, accepting mediocrity in any aspect of your company is never an option. Tony, during his time at Nest, took the initiative to read key customer support articles for each product. While some CEOs might dismiss these as mere support materials, Tony understood their significance. Customer support articles often engage individuals on the verge of frustration, and by ensuring a positive experience, you can transform dissatisfaction into delight. Adopting a critical perspective on customer support articles, akin to scrutinizing product engineering or design, is crucial for a CEO.

The pursuit of perfection is a fundamental aspect of a CEO’s job. This involves pushing oneself and the team, almost to the brink. Unfortunately, many companies today are moving in the opposite direction, inundating employees with lavish perks like free meals, haircuts, laundry services, and massages. Tony argues against this trend, suggesting that offering extreme perks creates an expectation rather than something special. He advocates for subsidizing perks rather than providing them for free, drawing a parallel with Apple, which offers employee discounts instead of free products. The idea is that when people pay for something, they value it more.

While introducing perks with good intentions might seem appealing, they can easily be abused. Tony advises against the lure of extravagant perks and recommends focusing funding on building the business, improving products, and solidifying the business model to ensure ongoing employment. The emphasis should be on matters of substance – building something great – with the company’s mission as the main focus and perks serving as a complementary touch.

Final summary

One final takeaway from this is that:

To establish a successful career, develop a product, or build a business, it’s essential to tap into a deep reservoir of motivation and persistence. For those who are just starting out, especially the younger demographic, the optimal approach is to secure a job where one can absorb comprehensive knowledge about their passion and fully immerse themselves in the work. For those in more advanced positions, such as a management role, the primary objective should be to create an environment that fosters the achievement of desired outcomes by the team. CEOs, on the other hand, bear the responsibility of caring – urging their companies to take risks, pursue excellence, and ensure that everyone understands the significance of their contributions.

Additionally, there’s practical advice to consider: draft your press release before completing your product. Press releases serve the purpose of capturing people’s attention by succinctly highlighting the unique features of your product. By composing the press release at the inception of product development, you can set clear expectations. Upon nearing completion, whether it takes weeks, months, or years, revisiting the initially written press release provides a valuable comparison. If your current product aligns roughly with the original press release, it signals readiness for release, eliminating indecision, prolonged waiting, and deadline extensions to accommodate additional features.