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I recently had the privilege of hosting a fireside chat with Lieutenant General John Vines, who is regarded as one of the most influential U.S. military leaders of the past twenty years. You can see the talk here:

At the time, he was the only military general to lead combat operations in both Iraq and Afghanistan in the post 9-11 era, overseeing an organization of more than 160,000 troops.

For a man of his stature, he’s refreshingly humble. He jokes that he was the only guy to cause Defense Secretary Donald Rumsfeld to lose his voice from screaming at him in two separate wars. The General is one of those people with whom you want to hang out after spending only a few minutes with him. No wonder he is such an extraordinary leader.

During our conversation there were many leadership lessons from his experience that are highly relevant to entrepreneurs and CEOs. Here are a few of my favorites:

1. Leadership is different from management.

“In the end those who follow you willingly do it because they trust you and are inspired by you. They are counting on you to have their backs and to be right.” Great leaders rely on relationships and intuition. In a challenging situation, a good leader knows what their reports will do and what the outcome will be.

Vines underscored that management and leadership, while related, have very different characteristics. Management is the science that undergirds leadership. Leadership is the art. “Where leaders earn their pay is applying their judgment, skill and wisdom to all the data. Because if we were purely a data driven organization, then we could plug it all into some algorithm and it could tell us what the answer is.”

It follows then that not all great managers become great leaders. This concept has always resonated with me and I have seen this first-hand. A great leader gets the team to follow her into battle and does it with purpose and conviction. Great leaders also understand how to instinctively use resources to the best possible outcome.

2. Leadership awareness

“It is almost impossible to really see yourself as an organization and as an individual.”

Vines relayed the story of a complex combat operation that required the deployment of several infantry units. Vines ordered a large quantity of heavy equipment to support the mission, which his reporting system indicated was available. Problem was, it had already been provided to another unit and Iraqi counterparts.

Instead, Vines devised something he dubbed a “Delta Report”, which reconciled for a 30-day period all the things that were supposed to be available but weren’t; the equipment that was supposed to be repaired but was still in the shop; the gear that had arrived that no one even knew about.

In his words: “That 30-day Delta came out to be $11 billion of end-items, things like tanks and trucks, that we had been ordering from the States because we thought we needed them, but they were already there. We couldn’t see ourselves.”

Vines admitted his team spent a lot of time understanding their threat (you might call it the competition), but couldn’t see his operations in real-time. As a result, he made some large, painful changes, but ultimately made sure the right processes were in place for he and his team to see themselves in real-time.

I’ve always believed that self-awareness and company awareness are key attributes to being a great leader. I’ve seen all too many examples of companies and CEOs who are breathing their own exhaust. Leaders need self-awareness in order to have a complete and accurate picture of themselves and their company.

3. Identifying catastrophic risk helps to prepare for the unknown, but you can’t see all the “Black Swans” that lie in wait.

Vines relayed an example of a massive air operation he was preparing that required the use of hundreds of helicopters in Afghanistan. “It was massive, the number of planes used in the operation would have made it one of the largest air forces in the world. And that was just helicopters.”

At the moment of execution of the military mission, the key guy on the ground responsible for checking the purity of the helicopter became ill. There was nobody who could fulfill his job. Mission aborted.

“We spent hundreds, even thousands of hours assessing risk, but what we didn’t understand is that there were points of failure in this enterprise that we hadn’t even considered. We certainly hadn’t looked around corners.”

This story was particularly interesting to me in that, even with all the planning, something caused the mission to go sideways. I’ve seen this in companies. They plan and plan, yet something always comes up forcing a real-time change. In my experience, planning is a great tool but leaders always need to be prepared for solving the unknown as issues arise. You can never plan for all contingencies all the time.

4. The higher up the organization, the more time leaders should be spending with people in the organization as opposed to doing “tasks”.

As his organization got larger, Vines could no longer spend time with every person. However, he spent most of his time away from headquarters talking with his lieutenants, making sure everyone developed a “shared consciousness”, a shared vision.

“I believe leadership should be eyes on, hands off.” So Vines deployed wide-scale use of video conferencing to discuss high-level thinking and strategy with the troops. “Once an organization understands the objectives, a mid-level person can figure out the strategy.” Once they knew the thinking and the strategy behind what they were about to do ”the orders almost follow themselves.”

As an entrepreneur, your natural instinct as your company grows may be to spend more time doing tasks you are good at. If you are an engineer by training, this may mean spending time with the engineering group. My advice as your company grows is to spend time with all groups and help to create a deep bench of executives who each do a better job than you in their given areas. Spend lots of time with them; spend lots of time with your employees. The organization will see you as a great leader as opposed to a micro-manager.

Veteran talent

My time with General Vines gave me a much deeper appreciation for the similarities between military leadership and leadership in companies. Over 120 folks working in high-tech attended our fireside chat from the Bay Area. The vast majority were veterans.

One of my other takeaways: Veterans can bring really important leadership qualities to your organization. These folks are truly amazing.

As Vines put it, “Sometimes the scale is different. Sometimes the cost is different in blood and treasure. But there are more similarities than differences in business and warfare.

“Every person that we asked to go forth to do something at extreme risk—at risk of their life—we owed it to them to do everything we could to create conditions that would allow them to do that, and come back alive and intact to their families.

“If you could look in the mirror and say, ‘I have done everything humanly possible to create an environment of mitigated risk,’ I think you can live with yourself. If something goes wrong because you are lazy, or because you didn’t devote the proper rigor to it, then you have to live with those consequences too.”

The views expressed by LTG (ret.) Vines in this article are his own and do not represent the views of the U.S. Military or Government. “Warlord 6” was LTG Vines’ call sign in Iraq.

DataGravity is poised to transform the storage landscape. The company represents a once-in-a-decade opportunity to create an entirely new category of storage by unlocking the value of data that today sits idle in a storage system. I call the category “Storage Intelligence” and the transformation will be profound.

The story starts with DataGravity’s incredible founding team: Paula Long and John Joseph. Paula is a technical visionary in the storage world and was the co-founder of EqualLogic, a storage company acquired by Dell in 2008 for $1.4 billion. John was also an early member of the EqualLogic team and brings great talent in sales, marketing and operations. Unsatisfied with the pace of innovation in the storage world, Paula and John have teamed up again to royally disrupt the staid storage industry.

DataGravity’s focus on storage intelligence highlights entirely new thinking in storage innovation.   We’ve seen hundreds of new storage companies in the past few years and most have followed the well-worn path of incremental feature development, focusing on storing dumb bits of data at lower cost with faster access. Interesting and incremental—hardly transformative. A race to zero does not make for a killer new category.

Unlocking the next generation of storage requires looking at stored data not as a dumb repository of expensive bits, but as the foundation for usable, intelligent information. We’ve overlooked the data as the true asset to our business and we store it away without giving any thought to what it’s saying about our business, our customers and our users. The DataGravity team will take what is considered an idle operating expense and convert it to near instant business value.

We’ve only begun to see the explosion of data and its value to businesses of all sizes. DataGravity’s mission of turning dumb storage into meaningful information will give new meaning to storage infrastructure. As data centers evolve and information becomes central to the competitive advantage of organizations, DataGravity will fill a storage need that goes far beyond the current storage developments of today.

I am pleased to be joining the board of DataGravity and working with the team that is going to transform storage.

Everything that can be invented has been invented.
—Charles H. Duell, Commissioner, U.S. patent office, 1899

Last month, we gathered 75 of the top CIOs from around the country to discuss the new generation of enterprise software and the redefined role of the CIO. These CIOs are dealing with an unprecedented level of experimentation and innovative new approaches focused on unsolved problems in enterprise software. The end result will be a complete remaking of the entire enterprise software stack at the intersection of cloud, mobile and SaaS.

All of the CIOs are also facing a changed environment, one where every department within an organization makes its own software buying decisions, outside the purview of the CIO. This “departmentalization of applications”—from Box for collaboration to GitHub for software development to Tidemark for Enterprise Performance Management—means the CIO not only needs to figure out how to enable the department and employee to leverage these software products, but also meet the security and compliance requirements of the larger corporate environment—which, by the way, Bromium, CipherCloud and Okta allow you to do. These CIOs know that they can adapt or organizations will adapt without them.

Their jobs weren’t always so difficult. For those of you old enough to remember, there was a time when enterprise computing was almost exclusively dominated by Microsoft, Oracle and Cisco. It was a time when on-premise, Windows-based applications were the de-facto standard and there was no alternative. The enterprise was so entrenched that challenging the status quo was viewed as suicidal and very stupid. So hardened was the thinking that most innovation in the enterprise was relegated to mere feature extensions of existing solutions.

Fast-forward to today and the world of enterprise computing has done a 180. Traditional IT is being blown to bits as cloud infrastructure, Software-as-a-Service and mobile computing become the new standard. We are experiencing innovation and usage as never seen before. It is truly a renaissance of massive scale. Hundreds of billions of dollars are up for grabs as buyers shift to new architectures and away from old, as new users and new markets embrace the availability and ease by which they can consume technology.

On the Road to a Revolution

VMware and Salesforce catalyzed this movement from unlikely origins. Both were little known and under-funded, but against all conventional wisdom each visualized a new world order—a world where the data center was virtual and where applications would run off-premise, eliminating op-ex and painful software upgrades. The world watched but there were few believers. “Suicidal,” people said. “Why would I ever permit my precious customer data to reside outside my firewall?”

But momentum grew. VMware figured out how to effectively break apart the functionality of software from the hardware it resides on, driving a new set of economics into data centers. Salesforce began expanding beyond CRM, demonstrating the wider viability of subscription-based payments and the customer benefits of constant iteration. Customers began to believe that this new vision might actually come true. From a single virtual server and a single customer relationship app, both companies paved the way for a new world order.

Every part of the business software stack is now being remade—from infrastructure to applications to mobile to analytics—with every incumbent in danger of having its core business eroded. And, sure, incumbents will try to buy innovative products and will try to develop their own competing technologies, but the reality is that this new paradigm disrupts the entirety of these businesses. Overcoming a foundational shift cannot be met by a simple product buy or even a strategy change—the new breed of enterprise software startups has different revenue recognition policies, different sales models and different go-to-market models, and engineering processes than incumbents. We are talking about transformations occurring here simultaneously in technology and business models! It’s an entirely new approach to IT.

The Departmentalization of Applications

Buyers are clamoring for this new approach. None of our portfolio companies use Oracle. Some use Microsoft, but the majority opts for Google or an open source package. In our own Executive Briefing Center, where we connect and facilitate exchange amongst global brands and the rising stars in tech, we’re finding that even enterprise CIOs are looking beyond mature players to new and emerging technology companies, especially in areas like cloud computing, mobile, big data and SaaS. These are the early indicators of a more permanent shift in IT consumption habits. This shift is resulting in software applications that are targeted for specific business functions. Apptio, for example, has built a world-class application that specifically targets the CIO as a customer. Mixpanel helps companies learn from their data and grow their business, with a specific focus on analytics for mobile applications. This shift is what I am calling the “departmentalization of applications”.

And entrepreneurs know that incumbents are vulnerable. We see a tremendous number of entrepreneurs bringing a new approach to this crusty, old enterprise software market. We see entrepreneurs like Ben Werther of Platfora, who is passionate about up-ending the Business Intelligence market, and Ash Ashutosh of Actifio, who is creating the next generation storage software.

These are entrepreneurs who choose to do the hard work of building software for companies to use, and the software they are creating is elegant, fast, does what it’s supposed to, and priced fairly. This is an unbeatable value proposition. For everyone except perhaps the incumbents, this is a great time to be involved with enterprise software.

Throughout my career, I’ve been an executive at several tech companies that have revolutionized enterprise computing. I’ve also been an investor and venture capitalist (in the past and currently) focused on finding the next BIG things in tech. But I’ve also been fortunate enough to teach at MIT and Stanford, where I currently teach (during different terms) a sales management class and an ethics class at the Graduate School of Business.

I love teaching because I am able to make a difference in a student’s future. Whether I help to unlock a new concept or see a student follow her lifelong dreams, teaching and passing on knowledge has become a passion of mine.

I also recognize that education methods have not fundamentally changed in hundreds—possibly even thousands—of years. The core learning structure has always been and remains one teacher and a limited number of students. This structure reduces learning opportunities for much of the world’s population (even in first-world countries) and limits the impact of the best educators to no more than a few dozen lucky individuals a year.

But it doesn’t have to continue like this. From a business perspective, this is a supply and demand problem in that the demand for quality education is not being met by an adequate supply of learning opportunities. From a technology perspective, this is a problem that can now be solved with software. From a societal perspective, there should be alarm bells going off for everyone that this is an issue that requires our boldest ideas and brightest minds.

And that’s why we’re so excited to announce our investment in Udacity, a team and company that we’re absolutely convinced will change the world. We believe the next big disruptive trend in software will focus on education and we feel that this is the team that will lead the way.

Let’s start with what Udacity does. By leveraging the economics of the Internet, Udacity aims to democratize education by delivering world-class coursework to hundreds of thousands of students everywhere. There’s no doubt that online learning will radically shift the economics of education.  Udacity has the magic formula because they are combining their platform with their content to make learning highly interactive, targeted and instantly available to students around the world.

The company recently released an online science class that was viewed by over 230,000 students. The innovative material, high quality presentation and ease of access propelled its viral spread. The team is building on this experience as they build their plans to materially change higher education.

We see a lot of distinguished entrepreneurs, but this team stands out, starting with the CEO, Sebastian Thrun, a Stanford professor and entrepreneur. This is a team that cares deeply about changing the world and was the core team that invented the Google self-driving car. As important as that project will be, Sebastian and the team want their legacy to be about reinventing education and they understand the wide-reaching impact that this will have on our future.

There is no question in my mind that the work being done today, to leverage software to improve education, will result in a better tomorrow for people all around the world. I am delighted to be joining the board of Udacity and look forward to working with this team as they change the world. Help us spread the word.

The world of enterprise infrastructure has been undergoing a fairly dramatic renaissance over the past several years. Where hardware once dictated datacenter capabilities, intelligent software is now the key component in defining and building the new datacenter. For example, you may have previously bought a server by specifying its hardware characteristics, but you can now define a server through software by way of virtualization. As the datacenter continues its transformation—from a static, hardware-based environment to one that is defined by software—the result will be an agile, cost-effective, enterprise-class infrastructure for next-gen computing.

To date, the major innovations in enterprise infrastructure have occurred in the compute and networking layers of the datacenter. VMware transformed the x86 hardware landscape through server virtualization, and more recently, Nicira (acquired by VMware) redefined networking by creating a software framework for networking. Storage is the last big piece of the datacenter that is ripe for disruption. While there have been recent innovations in new storage technologies like flash, storage architectures remain hardware-defined and have not changed fundamentally over the past 20 years.

Through Convergent.io, the potential of the software-defined datacenter will be fully realized—at last—with software-defined storage networking.

The team at Convergent.io is uniquely qualified to usher in a new world of software for storage. The founders have deep technical backgrounds and have been part of previous transformative trends in storage and virtualization. The three co-founders are infrastructure rock stars. Ramana Jonnala started his career at VERITAS where he helped to define the pre-eminent storage architecture of the past 20 years. Ramana was also instrumental at XenSource, which was acquired by Citrix, where he led a variety of virtualization initiatives. Keir Fraser and Andy Warfield have deep virtualization and storage backgrounds. Keir was one of the inventors of Xen and Andy has produced a mountain of storage code for virtualized environments. The team could not be better suited to take on the new storage networking opportunity.

As someone who has worked with this team for many years, I am thrilled to work with Convergent.io and the superb founding team.

We just invested $100M in GitHub. In addition to the eye-popping number, the investment breaks ground on two fronts:

  • It’s the largest investment we’ve ever made.
  • It’s the only outside investment GitHub has ever taken.

Why did we bet the farm on a series A investment? It starts with the four founders: Tom, Chris, PJ and Scott. They had a vision for a new way to develop software and created a new kind of company to pursue it. With only a handful of people in sales and marketing, the four grew the company to over 100 people, while growing revenue at nearly 300% annually—and profitably nearly the entire way.

How did they do it? They took an old technology category and turned it on its head. Source Code Management (SCM) is the second most fundamental tool for a programmer after compiler and development tools. It stores, versions and branches source code being developed by teams of programmers. At scale, these systems become highly complex and often difficult to manage. In addition, historically SCMs have been anti-social. The No. 1 conversation they generate is referred to as: “Who broke the build?” GitHub solves these two problems and dramatically expands the category by changing the old model in two important ways:

  1. Rather than forcing every development team in the world to deploy their own SCM, GitHub runs one big SCM in the cloud and the management issues vanish.
  2. GitHub organizes projects around people rather than code.

These changes may seem simple at first, but their ramifications have been stunning. Because modern programming tends to be about assembling code—in the form of libraries, open source work, etc.—as well as writing it, code tends to belong in one place where it’s easy to access. That place has become GitHub with over 3 million Git repositories.

By orienting around people rather than repositories, GitHub has become the de facto social network for programmers. If you are using another programmer’s open source libraries, are interested in what she’s doing or just a fan of her work, you can follow her on GitHub. If you need to hire great programmers, why look at resumes when you can view a candidate’s actual work on GitHub?

Beyond the growth and great products is GitHub’s incredible culture. Tom, Chris, Scott and PJ constantly push the limits on the status quo and drive new thinking in terms of management, hiring and clarity of vision. At a16z, we share this vision and I am honored to be joining the board and partnering with the company as they continue to build one of the great software success stories of our time.

We are delighted to announce that the six General Partners of Andreessen Horowitz, with our families, are all committing to donate at least half of all income from our venture capital careers to philanthropic causes during our lifetimes.

The reason is simple.  We are fortunate to work with some of the best entrepreneurs and technologists in the world, and in the process help create great and valuable companies.  That activity, done well over decades, can generate a lot of money that can then be productively deployed philanthropically back into the society that makes it all possible.  We love participating in this process, and we hope that our philanthropy can, over time, help make the world a better place.

As an initial catalyst, we are making an immediate group donation of $1 million to a set of six vital Silicon Valley-related nonprofit organizations.  Those causes, and their respective sponsors, are:

Ben and Felicia Horowitz: Via Services
Jeff and Karen Jordan: Ecumenical Hunger Program
John O’Farrell and Gloria Principe: Second Harvest Food Bank
Marc and Laura Andreessen: Fresh Lifelines for Youth
Peter and Martha Levine: Canopy
Scott and Pamela Weiss: The Shelter Network

Signed,

Ben, Jeff, John, Marc, Peter, and Scott