How Can We Double Down?
One thing I wished I had done from the beginning of my venture career is to simply dedicate a notebook to great pieces of wisdom I would hear around specific situations raised in the context of a board meeting or partners meeting. At the end of the day, the venture business is about pattern recognition and such a notebook would help in building that database of patterns that one could fall back on. Fortunately, I have a decent memory for these things, but if I had it all down on paper, that would be even better. For those of you VCs who are earlier on in your career, I’d recommend you trying something along these lines. I may use this blog to capture some of these insights going forward.
Today’s post is about one such piece of wisdom that I think is particularly relevant in these times. This piece of wisdom came from Jeff Bezos, founder & CEO, Amazon.com during an MFG.com board meeting. Jeff asked the question, “Is there anything big or small, that is working better than you expected? Is there any where we could double down?” Jeff’s point was that we spend a lot of time focusing on what’s not working in Board meetings (especially in times like these), and not enough time focusing on what is surpassing expectations and how we can “double down” on those areas. Often times the key levers in businesses are found in little things that are really outperforming whether by intention or not (often not, actually). Sometimes these are things that are either adjacent enough or small enough that they wouldn’t make a board presentation or be an obvious discussion point because they’re just seedlings that need to be watered. I appreciate how Jeff wanted to bring these seedlings to the forefront to see if they deserved some real investment.
I now make a point to periodically check in with all of my companies, whether things are going great or not, to see if there are areas where things are working better than planned – areas where we can double down. Some types of things I have heard in the last year:
- A particular use case for a product is taking off despite the fact that we’re not marketing that use case.
- A particular customer segment has a sales cycle that is much faster than the other segments we’re targeting.
- We’re completely ignoring some aspect of the business that is “non-core” but it continues to do well despite that.
- A customer is getting real value from our product in a way that we didn’t anticipate.
- A specific region is adopting our product, and we have no sales and marketing there.
- Customers are saying great things about us on the Internet.
- A particular marketing channel or marketing message is converting better than we expected.
- A particular sales rep has cracked the code and is destroying their quota.
- We have a particular customer who is going out of their way to help us in our product development and positioning.
- Employee morale is high and retention is great.
- Etc. etc. etc.
To all of these cases and many more like them, it’s worth asking the question, “How can we double down?” So often the market tells us things that are key to the success of our business if we just ask the right questions and listen closely enough.
Thinking About Thinking 
Nice post. I have thus far been quite impressed with all of your posts, too.
Thanks! I appreciate that. What does your blog name – Cheaply Apodictic mean?
I’m reminded of a 1987 Hambrecht & Quist research report authored by Joseph Laird that analyzed information vending companies. At that time information vending needed a lot of background info in order to distinguish their line of business from mainstream media companies. After analyzing the operations of companies ranging from Dow Jones to M/A/R/C to Bloomberg, the report concluded that the bulk of information service value came from first having either a proprietary method of data acquisition or distribution, and then being able to analyze transactions in aggregate in order to identify surprising areas of growth. It’s amazing that information vending has gone from being an exotic offering with high barriers to entry to mainstream, and how many concepts from that report are not only still valid but just now being recognized.
The more things change, the more they stay the same.
Funny, would love to read that report. I guess things do come around – that may be worthy of its own blog post.
Larry-thanks for the tips. As someone new to the VC biz, this is great stuff. Please keep ’em coming.
John – glad it’s been helpful. Hope you’re enjoying the business thus far.
Larry, I have already learned a lot from the pearls you shared with the team. The approach to networking has stayed with me and I continue to use it to this day. The “3 big ideas” question is another I still use.
Another thought on this point is how the notebook we all carry in our heads can have different covers and titles, one called parent, another called spouse, another called son. Same rules apply… Thx man, this is becoming my favorite blog
Great point Stephen and thanks for the high praise! Coming from you, that means quite a bit.
Good to see you blogging Larry.
The other related question that I like to ask, whether it’s in a first meeting or in a board meeting, is “what have been the most surprising things about the business?”
The best answers are usually, well, surprising and lead to some interesting conversations.
Hey Kevin – hope General Catalyst is treating you well. I always hope for no surprises at board meetings!
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만박의 생각…
제프베조스가 이런 말했단다. ‘의도했건 안했건, 어떤 분야에서 의외의 성과가 나고 있을 때 그 분야에서 How Can We Double Down? 할 수 있을지’ 더불어 대중과 커뮤니케이션하는 게 아니라 커뮤니케이션 주체가 대중이라는 관점을 가지고 있어야 가능할듯….
[…] Larry Cheng discusses Jeff Bezos’s question during an MFG.com board meeting: “How can we double down? […]
[…] Larry Cheng in “How Can We Double Down?”… […]
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[…] a Hippocratic-type oath for health care managers? / improved (has it even started?) hospital board trustee certification (education) would be good, too / knowing the operation would improve the “double down” conversation […]