Reid Hoffman Revealed Bloomberg Game Changers
Video Copyright is owned by Bloomberg LP, its shared for education purpose only and free press. Thanks to Bloomberg.com
Video Copyright is owned by Bloomberg LP, its shared for education purpose only and free press. Thanks to Bloomberg.com
0:01 from million the high stakes chase for the next big thing in Silicon Valley 0:06 everyone wants the blessing up Reid Hoffman I played the game from all the 0:10 different angles from 0:12 being founder from being an executive from being an investor 0:15 me an angel investors venture investor board member well 0:18 and buy you should always and some lock he's had more 0:22 then good luck the characteristic read like the other entrepreneurs 0:26 his distaste seeing something that the rest of us don't see 0:29 ok is always thinking okay what's the next big thing 0:32 what's the next thing is ten times as big the relentless approach 0:36 has paid off $850 million dollars in revenues roughly what the projecting for 0:41 this year 0:41 you start to think about billion dollar revenue companies there aren't that many 0:44 of them 0:45 in the money world Silicon Valley social media lead 0:49 Reid Hoffman is at the center of it all and he continues to roll the dice 0:54 with new start-ups with his expression here fail fast 0:57 and it seems paradoxical right because you like more you don't wanna fam 1:01 well what it really means is if you are gonna fail sell stocks you can see 1:06 succeed in the long run 1:07 is you get off the failing pack U Haul truck for some it may succeed 1:14 ok 1:19 good 1:23 the invites pop up in your inbox almost daily 1:26 if you're looking for work are looking to hire linkedIn is the world's largest 1:30 professional networking site 1:32 with over 150 million users but the collection everyone in Silicon Valley 1:37 wants to make 1:39 is with its cold founder and executive chairman Reid Hoffman 1:43 LinkedIn is the externalization I've read right redid the consummate 1:47 networker he's a consummate Kanak 1:49 he is the person that people go to when I start a company I mean he's the first 1:54 person you want to talk to you about 1:56 you know does this make sense how should I do it 2:00 who should I talk to you is this a stupid idea or a good one 2:03 well I think greed is very different from 2:06 someone like job sir Olson I mean he's not a 2:10 narcissus for sociopath or some Aspergers 2:13 heat does actually care a great deal emotionally about other people 2:18 if the congenial CEO created a website where recent college grads 2:23 mid-level managers and executives could network 2:27 and yet read wasn't much of a connector himself 2:30 in his early years growing up in the Bay Area I was 2:34 kind of a geek the kid was reading science fiction books and costs 2:37 had you know two to five friends 2:42 I but I spent almost all my time with I was mostly a loner 2:46 the man changed when the preteen hartman 2:49 became obsessed with role playing games like Dungeons and Dragons 2:53 and room quest a new friend scored a min invitation to a game company 2:57 testing night and I started hanging out the office cuz they 3:01 they recognize you know it's kinda this irritating twelve-year-old 3:04 you know Scott underfoot other than going to school that was the thing I did 3:08 with every hour that I had under my own dispositions 3:11 Hoffman was so enthusiastic he rewrote a game manual himself 3:16 the impressed editor offered him a job to review a new game and so I took it 3:22 home and worked all weekend buy-back fund a 3:24 I was obsessed I didn't do anything other than sleep and work on that paying 3:28 for between Friday night and 3:30 Monday mornings six years later 3:33 at Stanford University hoffman's obsession with multi-player gaming 3:38 grew into an interest in artificial intelligence and cognitive science 3:42 future Silicon Valley billionaire Peter Thiel was one of his classmates 3:46 Peter and I were introduced to each other cuz his friends 3:49 were saying that you know he should meet this 3:52 really lefty liberal guy right past me I'm 3:56 and my friends are saying I should be this really extremely right-wing guy 4:01 you know that's Peter Peter Thiel is now a legendary San Francisco venture 4:05 capitalist 4:06 and founder Clarion Capital I like to quote margaret thatcher that 4:10 it's the fact that society does not exist only individuals do 4:14 and reader a dispute aside it was very real 4:18 communities were very real and we need to use technology to create new 4:21 communities 4:22 we became close friends even when many times we still disagree 4:25 Hoffman earned a Marshall scholarship to study philosophy at Oxford 4:29 but grew restless and returned to Silicon Valley 4:32 he wanted to start a software company he just didn't know how 4:36 I wrote down a list I'll 4:39 all the skills I thought that I would potentially need 4:42 in order to do a company in fact went okay what's the quickest path but I can 4:46 get through 4:47 doing a set of jobs the company's in order to get Masseria these words skills 4:52 the first company apple computer it was nineteen ninety-four 4:56 nine years after Steve Jobs original departure 5:00 and a low point for Apple it was a strangely 5:04 dysfunctional screwed up organization with watertown to people who 5:08 weren't able to get very much done 5:11 hoffman's job was at the world the computer makers early attempt at 5:15 creating a social networking site 5:17 always kinda centric group make a run off on the fringes 5:21 the head eccentric was group product manager 5:24 Richard gingrich's when the world marched arm 5:28 lol I had I believe about 200,000 subscribers 5:32 so we're probably talking about the sum total of people online 5:37 being well less than 500,000 people we didn't know where it was going to go 5:41 we sat around a lot just serve brainstorming about 5:45 you know what would it mean when when it wasn't dial-up modems and we have 5:49 broadband capability 5:52 they were going to find out at you world the experiment was a dud 5:56 a lil acquired the world in 1996 6:00 the next year Hoffman was starting his own company 6:03 social net the new it was a little e90 before something with course 6:08 had social networking in it in the in the name of the company 6:12 seven or eight years before it became a Tron the 6:15 Hoffman began searching for people to help him with his new venture 6:19 a mutual friend introduced him to Alan blue 6:22 a former drama major at Stanford basically the way he texted 6:27 to me the time was the same social now is a 6:30 leading technology first technology from matching people up 6:34 and dating seems to be its primary 6:37 initial value but we could apply the technology to a lot of different 6:41 problems 6:42 but social net had its own problems the board believe the main strategy for 6:47 social net 6:48 was a television advertising campaign but read felt their product needed to be 6:52 refocused for 6:53 online distribution the discussion I had with the board was well look I think 6:58 this is broken 6:59 I think this is essentially college restart night meryl for just you know we 7:03 do what other people are doing what we buy traffic arkansans work just fine I 7:06 was like well 7:07 I don't really agree I know they are right now I'm gonna go find a new 7:11 company 7:12 of 7:17 ok 7:18 ok faced with no control over the company he founded 7:23 Reid Hoffman left social net in January 2000 7:27 there were a lot of lessons we've learned from from the 7:30 billiard social not I have been cobbled together a bit haphazardly and in 7:35 retrospect 7:36 and read hadn't been position to attract higher 7:39 most talented people and a and then there's order 7:43 and what they were challenges with a venture capitalist challenges with 7:46 on number the other executives and so people to start blaming each other for 7:50 things that go wrong 7:51 and assorted and sipping on unhealthy atmosphere seeking a new direction 7:55 he reached out to his network and called his old friend 7:59 from Stanford expressed frustration sadness 8:02 at the same time hardened we all have the Suns 8:05 this was very early in the history of the Internet and that there was 8:09 a lot more to do do you have just launched his own startup 8:13 called confetti a Financial Services website for the Palm Pilot 8:18 he pushed of men to join him we should look 8:21 we don't have a business model them map doesn't work you know 8:24 hits a short gig like we actually really expected I was only there for six months 8:28 confetti soon emerged with a deal on masks 8:31 X dot com to become Pay Pal my initial goal was 8:36 CEO which was basically to help tighten up all the operations 8:40 peter also said we have these other emergencies the could just kill us 8:43 so I want you to be the utility player on that stuff the account turned out to 8:47 be even bigger than 8:48 we expected we were like in a small though about to go over 8:52 a big waterfall and most the time people rode really hard gone the other way 8:55 the movie complicated issues 8:59 the southern MasterCard where are they were very suspicious about us 9:03 other were questions about banking regulators 9:06 are was a bank would definitely do not want to be seen as a bank because 9:10 subjected to enormous are regulatory loading scrutiny 9:14 could people use this for money laundering or things like that 9:17 the actual definition bank that accepts deposits in a while 9:20 looks like a possum people how will you know what does that mean 9:23 but in a course you know what is a fun card phone card deposit 9:28 Hoffman convinced his old social net colleague Alan blue 9:31 to join him paper I was a company which 9:34 had to scratch and claw for every advantage it had 9:39 henry became an expert at competing effectively 9:44 in an extremely crowded release extremely competitive marketplace 9:47 Ari levy is the technology reporter for Bloomberg News 9:51 yet remember the people who are running pay power were 9:54 the most ambitious people in history of silicon valley you know Peter Thiel 9:58 David tax-free 9:59 of many landmarks be four guys who just want to start something 10:02 and you know make a quick buck by putting it they actually wanted to 10:06 dominate the world they would later become known as the Pay Pal mafia 10:11 of men showed himself as a brilliant strategist 10:15 as Visa suspicions grew the credit card giant considered cutting pay pal of 10:20 Hoffman figured out a way to buy time 10:23 Ilan mask the visionary billionaire behind Tesla Motors 10:27 and space axe was a founder of paper if he's in mascot and shut the FAA shutdown 10:32 Pay Pal 10:33 in 2000 we would have died almost instantly and it's pretty worried about 10:37 that 10:38 so i three diff you read if you could going to talk to the the key players 10:42 there and and 10:43 he he didn't came back and said convinced them to 10:46 keep us US Open read encouraged research to do 10:50 was to work on a series of studies to determine 10:54 whether it was actually is problematic as it was from our point of view 10:58 even buying a year year and a half time was incredibly valuable 11:02 from basis point of view which was more Arbor crowded and slow organization 11:06 on spending a year or your nap on a study didn't seem like that big a deal 11:10 and that was a great compromise a rather than 11:13 be subsiding us down on the spot the biggest competitor to pay pal 11:18 wasn't 800-pound gorilla called e-bay 11:22 run by the top and aggressive Meg Whitman e-bay was pushing their own 11:26 payment service called 11:27 bill point he there was like a Walmart for joint store 11:31 and it was a different company running the cash registers there was this 11:35 constant part that 11:36 as payment fees for something they should they should themselves on 11:39 a vast majority the business grew up on transactions on eBay value BAM 11:44 unclear the Pay Pal ever could have gotten nowhere was but was also a huge 11:48 risk factor 11:49 and so while we're independent he was constantly trying to compete with us now 11:53 we were winning 11:54 on February 15th 2002 two years into hoffman's six month gig 12:00 Pay Pal went public raising seventy million dollars on its first day of 12:04 trading 12:05 good but its problems were far from over 12:08 got to a point where was just an untenable situation makes it very hard 12:11 as a company to continue to run when you see your stock up ten percent because 12:14 the bay says they're gonna come out something next month 12:17 the were poor suffered are rounds a he be trying to acquire the company 12:22 finally happened on the on the have time five months after I P O 12:27 Pay Pal finally agreed to the acquisition 12:30 the fight was over it weighs 12:33 sort of the least bad option and was actually pretty good option because it 12:36 was a one and a half billion dollar acquisition for a company that 12:40 you know up until very recently had trouble to make a doc email italy won 12:43 from 12:44 all the techniques are trying to do to get people not tease us to saying hey 12:47 use Pay Pal 12:48 the volume just jump massively in the first quarter overnight 12:52 Hoffman was a multi-millionaire but while colleagues like teal bought a 12:56 Ferrari 12:57 Hoffman had different ideas and also how ya shall get a car to cause at that time 13:02 I was driving I think ok 13:04 I hand-me-downs chevy blazer a balk an Acura luxury Honda 13:09 Abuelo's but not how interconnected 13:12 so I spent the fall 2002 kinda really doing a lot of deep introspection 13:17 and what I realized is what I would want to be doing is creating some 13:21 technologies that could change the world 13:29 no 13:30 ok 13:33 in October of 2002 Reid Hoffman quit his day job and pay pal 13:37 although he'd made millions he wasn't about to retire 13:41 that summer he had invited a small group of his trusted network 13:45 to a discussion meant to test several ideas for new start-ups 13:51 I realize the world work was changing 13:53 the people now needed a platform for how to navigate as individuals 13:58 I have a business idea that I think could be really transformational about 14:02 how the whole world works how people manager careers have to manage their 14:06 daily in WI 14:07 an and we could work lives we went on the table and we applied what we knew 14:11 about successful businesses at that point to each of those ideas 14:15 we tried to punch holes in the various ideas summertime 14:18 for user to punch holes in others and what became linked it was one of those 14:22 ideas 14:23 hoffman's radical idea and online social network 14:28 for professionals venture capitalist David C 14:31 was one of the first to see the potential at that time 14:35 social networking was considered kind of silly in fat ass the idea that you would 14:39 do this is business was considered kind of 14:41 incomprehensible and crafts almost at some level 14:44 investors had been burned by the dot-com crash of 2008 and wondered if people 14:49 would choose to expose their job history online 14:52 at the time internet users typically hid behind 14:56 aliases Yahoo veteran Dave Goldberg 14:59 was there at the beginning that notion real identity and having those 15:03 identities linked to each other 15:04 on that that's the fundamental basis for web 2.0 15:08 having your real identity online is a total game changer for 15:13 how we use the web ok 15:16 on the heels of his paper how payday Hoffman could bankroll the venture 15:20 himself 15:21 rather than waste valuable time wean investors 15:24 what are the key things to shorten the speed to getting the market 15:28 a min Lee viable product was one of the things I've learned from 15:32 social at and Pay Pal opposed to waiting for perfect product 15:36 you actually wanna be watch it the minimum viable product soon as possible 15:40 product a new interim and develop 15:43 this pig sty my office nine months after hoffman 15:47 first floated the idea to friends LinkedIn went live 15:51 on may fifth 2003 we actually had a bat 15:55 about how many users will be part olympian at the end of the first week 15:59 place for they were like twelve people the company time and we all had a number 16:02 and we had a big number we talked big government 16:05 15,000 candor and the guy who won the guy 16:08 get the lowest number which was 2200 16:12 low numbers didn't scare Sequoia Capital six months later 16:16 the venture capital firm behind startups like Apple 16:19 Cisco Google and Yahoo let a deal to provide LinkedIn 16:24 series a financing a 4.7 million dollars 16:28 the following year Hoffman also became an angel investor with his friend 16:33 fellow entrepreneur Mark Pincus the company 16:36 a new startup called the Facebook dot com reading I we're partnering 16:42 on every investor making and Sean Parker recommended 16:47 that Peter Thiel and read and I on bus pincus in Hoffman split in eighty 16:52 thousand dollar angel investment in facebook 16:54 but hoffman's own social networking site was slow to catch on 16:58 the focus that really brought us in the early days on growth growth growth 17:02 growth growth 17:03 was exactly the right folks every product every moment was about how do we 17:08 get people more connected 17:10 network with 50,000 people and it doesn't do anybody any good 17:13 and it will cost $5 million people it is incredibly valuable 17:16 and very hard to catch for the comparative perspective LinkedIn was 17:23 struggling to become profitable 17:25 Hoffman and his team insisted the site would eventually make money 17:29 three-way by selling advertising 17:32 through premium subscriptions and by providing hiring solution 17:36 for companies but all of this revenue hinged on LinkedIn's ability 17:40 to grow its membership exponentially Peter Thiel 17:45 was an early investor in LinkedIn we spend a lot of time brainstorming on 17:49 what would dont mean for our sites to on 17:53 become viral to go critical once you go critical 17:56 if every person signs up more than one person so the question was 18:00 what we have to do for the old LinkedIn product 18:03 to go critical the tipping point came in May 18:06 2007 with ten million members 18:10 LinkedIn held an in the black talon to celebrate the year of profitability 18:15 in the economic downturn the following year 18:18 membership grew to 33 million LinkedIn was thriving as the go to website 18:23 for job seekers in a down economy how do you make opportunities are make new job 18:29 star companies LinkedIn is designed for helping you with work as long as jobs 18:34 are important and work is important 18:35 Lincoln should be central with membership snowballing 18:39 Reid Hoffman hired former Yahoo executive Jeff Weiner 18:42 to take over as CEO in December 2008 18:45 the transition from a founder CEO to the next generation CEO 18:50 that can be really challenging at times oftentimes 18:53 it's difficult for people to meet position takata let go 18:56 combo never forget a a few nights before I started my first day 19:00 I said Rita how's this gonna work how are we going to be making decisions 19:03 which decisions 19:04 you want to be responsible for which might be responsible for he said all 19:07 that simple 19:08 your ball you wrong with it and I said really 19:11 he said gap that's the whole point Hoffman 19:15 started looking for new ventures my hobby is work 19:19 it and so basically what I do is a combination of investing in like 10 19:22 no matter how big when teams don't know how to bring any companies about what 19:25 he's always thinking okay what's the next big thing 19:27 what's the next thing that ten times as big 19:29 I 19:37 are yep in 2009 19:41 Reid Hoffman became executive chairman at LinkedIn 19:44 then took on a second a job as a partner in the venture capital firm 19:48 Greylock my sermon can I was also angel investing and i ended up deciding I like 19:53 investing on as well 19:55 as when you're a when your partner and governors they bring you the hardest 19:59 problems you help them work on those problems 20:01 ok Hoffman has taken only one big
Post a Comment