Playing To Win
Blend CEO Nima Ghamsari on taking educated risks in startups…and poker
Poker is a game of variance and probability. You can be dealt the best cards and play every hand perfectly until the river, the final card dealt in a poker hand, is played and shifts the game completely to the opponent. Similarly, startups constantly manage and learn from unpredictable experiences. Scaling a startup requires quickly learning from the wins and losses, focusing on the long term goals, and having a framework in place to help you make educated risks.
This episode of Greymatter isn’t your typical discussion around building enterprise startups. Greylock Partner Jerry Chen and Blend’s CEO and co-founder Nima Ghamsari discuss the similarities between making educated risks in startups and playing poker. The two also share “The 5 Whys”, a framework to learn from your mistakes and successes, and what it takes for your company to move fast.
Prior to Greylock, Jerry launched dozens of products as VP of Cloud and Application Services at VMware, including several “1.0” releases. Nima has a deep background in scaling financial services platforms having worked at Palantir Technologies and now leading Blend, bringing simplicity and transparency to consumer lending. In undergrad, Nima played semi-professional poker and applies the lessons learned from his poker days, like risk taking and how to plan for unpredictability, to his role as CEO and founder.
Below are a few key takeaways from the discussion, but there is much more to learn by listening to the full podcast.
Take Educated Risks
Every startup makes decisions based on imperfect information and unclear outcomes. Great founders understand this risk and make educated decisions with the knowledge at hand. However, measuring the immediate result of an action to determine if the decision was right or wrong can lead to long-term mistakes. Due to short term variables, wrong decisions can lead to good outcomes and right decisions can lead to bad outcomes. It’s important to replay decisions and diagnose what went well and what can be improved. The early stages of a company are about taking educated risks and properly learning from mistakes.
The 5 Whys
As a startup, you must learn from the failures and the successes. The 5 Whys framework can help get your team to the root cause of why something went wrong or right. Every other week or so, meet for 30 minutes and respond to every answer with a question starting with “why”. “Why did we lose a customer?” “Why was that thing important to our customer? “Why was that thing not built into our product?” This framework will help you dig deeper and provide valuable insight into your company and/or product. No matter the outcome, implement the mindset that your company can always improve the status quo.
Divide And Conquer
The earlier your company can divide responsibilities, the better. Autonomy and functional division of responsibilities allows your company to move fast. Hire a leadership team that you trust and that have a hands-on management approach, because autonomy over decisions is necessary to keep the entire company moving forward.
