Ben Casnocha:

So, Reid, today we’re going to talk about ABZ Planning—flexible planning.

And this is such a critical topic because there are a lot of misconceptions around how entrepreneurs create huge businesses, which is: we have this vision that Elon Musk or some hero like that sits in a room by themselves, turns off the lights, meditates—with great attentiveness to their breath, of course—and dreams up a business idea that’s profound and perfect in every way. And then they go out into the world and spend the next ten years executing that initial vision.

What causes a lot of people to not think that they can be entrepreneurs—in the traditional sense of the word, start a company—is that they don’t have a perfect idea. And they’re not sure that they should get started unless they have that perfect idea.

When in fact, the reality is that so many great businesses pivoted a bunch of times before they became successful; that is, they changed the fundamental vision of the business before they achieved success. And so, too, is the case in a lot of world-class careers, and we’re gonna talk about both examples in this episode: companies that really evolved and iterated; careers, some successful people who evolved; and then we’ll talk about a framework for how everyone here can adapt in their own career.

Because no matter what you’re doing, what stage you’re at, you need to be flexibly adaptive; you need to be always ready to adapt and change the thing you’re doing in your career relative to how the competition’s changing, how the world is changing, how you yourself are changing…

You go through the annals of Silicon Valley and look at all these—or outside of Silicon Valley, there’s so many of these successful companies. I believe that the history of Starbucks is that, initially, the vision was just to sell coffee beans and coffee equipment. It was kind of this novel idea that you’d sit in a coffee shop with a cup of coffee, like coffee by the cup was a novel idea. Pixar, as well, I think, initially sold sort of computers and animation services before they transformed themselves to become a full-featured Hollywood-style production studio that actually made full films.

Reid Hoffman:

Google was selling enterprise search with double-click as its backdrop. And then the ad market fell out and they had to go look around for other ideas for how to monetize it.

Ben Casnocha:

And Slack, which many of us use at work. What was Slack’s original—was it a multiplayer game?

Reid Hoffman:

It was a multiplayer game. It’s a classic—one of the entertaining truisms that goes around the Valley is when Stuart wants to go do the game Neverending once again, invest in it because it won’t be the game Neverending, but it will come out with some other interesting thing that was built during the effort to build the game Neverending.

Ben Casnocha:

Actually reminds me then of Twitter and Odeo, right? So Odeo was originally audio—it was a podcast business. Originally everyone loved this idea, and then just did a complete pivot-restart to become Twitter.

So, yeah, so many of these tech businesses had a different initial vision than the business they ultimately became. And I think what’s interesting is a lot of people misunderstand that when it comes to entrepreneurship traditionally defined; but then when it comes to life-entrepreneurship or career strategy, the same risk perception exists.

So we see all these examples of successful people and too many of us remember the example of someone like Bill Clinton, who when he was young did say actually, “I’m gonna be President of United States someday.”

I think when Bill Clinton was eighteen years old or something, he declared that, and, indeed, he became the President of the United States, for those of you who are our younger listeners.

But that is the exception. That is the exception. Because, by the way, there are exceptions to the business-side, too. LinkedIn’s initial vision and ultimate manifestation: pretty similar, I would say. So there are exceptions.

But generally speaking, both for startups and people—most successful people, the life they ended up becoming famous for, if they became famous, was very different than the initial vision they had, and one of the stories we tell in the book is of Sheryl Sandberg, who is stepping down now as COO of Facebook, but has spent the last ten years there as one of the most important people in in the tech industry.

You might think that someone so successful, so powerful, so central to innovation today, you know, studied computer science or something in school and had this vision at a young age to become a titan of industry.

But when Sheryl graduated from undergrad, she told friends that she wanted to have nothing to do with for-profit capitalism, and instead wanted to serve the world, and went and worked on public health projects for the World Bank or WHO in India. And, after doing that kind of service work, ended up getting an MBA, working in Washington, DC, for the Treasury Department…and, after several of these reinventions, ended up moving out to California, where she joined Google, and then ultimately Facebook.

And so somebody went from, “I don’t want to be in for-profit capitalism” to “I’m a billionaire tech exec.” That’s quite a transformation.

And Sheryl has this line, which I love, which says, “The reason I don’t have a plan in life—a career plan—is because if I have a plan, I’m limited to today’s options.”

And you can imagine: if Sheryl had constructed a life plan out of college, how that would have contained her and constrained her really…and really the world would have been worse off for it, because she’s had an incredible positive impact.

Reid Hoffman:

Yeah, and I think, you know, as for some of the other things we’ve said on the podcast, and also in the book, the not having a plan is—I don’t have a, “I’m going to be President of the United States,” you know, kind of thing and everything.

It’s the…she does have plans, she does execute on plan, she is very strategic. But it’s a question of, “I’m adjusting to what I see. And my plan is to go do some amazing work that will make a really big difference for people.” And, you know, and then more specific on that.

Ben Casnocha:

100%. Yeah, it’s the muscle- or skill-planning and adaptation without strict firm plans.

And, you know, this is a topic that—there’s a tremendous amount of urgency around, I think, for us. We feel really passionate about this topic and getting this topic across to people who care about this book because the world is changing. There’s so much dynamism in the world. In the book, we paint a scenario which I’ll sort of recap here, but with a little bit more of a different sport example.

So imagine you’re playing basketball, with all the usual rules: balls and baskets, two pointers, three pointers, fouls, double-dribbles. And all of a sudden, people come out onto the court with boxing gloves, and just start punching you in the face. At first you think, “What’s happening here?”, but then the referees actually start counting those punches to your face as points just like baskets. And they tell you, “If you don’t like this, you can go outside.” So you go outside, and you happen to encounter a massive snowstorm.

That’s the modern world today. That’s the modern landscape of careers. All this crazy stuff is happening. And we all lived through the COVID-19 pandemic. And I think, Reid, when we wrote the first edition of The Startup of You ten years ago, we talked about black swans and adaptation and the world is unpredictable and uncertain. And I think a lot of people said, “Yeah, that sounds like a business book cliche.”

And then we lived through a two-year period of time where literally millions of peoples’ careers were put on pause, sometimes indefinitely. Industries were entirely transformed. And I think we all realized sort of firsthand how much things can change unexpectedly. And hopefully, we’ve all now learned the importance of being sort of in a crouched adaptive position in our life. So we can deal with the next pandemic, the next technology change, the next disruption that we might encounter.

Reid Hoffman:

There’s very wide swaths of uncertainty in life. And if you think that you have certainty—certainty about knowledge itself, certainly about the market, certainly about how things are playing out…and that’s part of what the black swan is, the thing is to say, “Well, actually, in fact, things can change.”

Now, most people—’cause we presume that if we get in the car, and we drive somewhere, we’re not going to get an accident, and we have certainty of getting there. Look, those are very small percentages, you know, there’s a lot on our lot lives that we can rely upon.

But at these macro levels, you want to actually kind of presume that there’s broader ranges of uncertainty than you’re normally thinking about. And so you need to execute your life—how you survive, how you thrive, how you make progress—against that.

And that’s part of the reason why we said, well, it’s kind of the core of The Startup of You idea, which is: take the skills that entrepreneurs develop and refine and apply to your individual life. It doesn’t mean start a business. Some people do, some people don’t. It’s that flexibility, that adaptability, that learning, that understanding that things are changing.

And the ABZ planning framework is really central to that because—well, simply, no plans…well, no plans, kind of…you take what the world deals you. And by the way, you might be lucky, might work out well.

But part of, I think, being strategic is how do you increment your chances of being lucky? How do you go from…call it a 10% chance of being lucky, to a 50% or 60% chance of being lucky? And how do you play strategically and smart so that you play again, and you play again, and you play again, and you play from places where you have a chance of doing something, you know, interesting or aligned with your goals and aspirations?

And that’s what entrepreneurs have to learn how to do. Because exactly as you kind of open this up, the vast majority of interesting companies—even ones that stay fairly on track with what they’re doing, like LinkedIn was, “We’re going to be a professional network focused on individuals, helping individuals be productive.”

They say, “Well, did everything work exactly according to plan?” And I say, “Well, no, actually, in fact, we thought that for the first number of years, the principal business model—the individual subscriptions—that would be the business, but it’d be driven by individuals.”

What we found is the moment we launched and started doing our individual features as companies started coming and saying, “We like your enterprise products.”

And we’re like, “Well, we thought you’d come to us, but we thought you’d come to us like five years from now, like not now.” And so we quickly mock something up.

Well, they come, we say, “Oh, this is the product we’re working on.” Got people saying, “Oh, I’d buy that today.” And we went, “Oh,” and that became our primary monetization.

Ben Casnocha:

You didn’t anticipate that customer need when it popped up.

Reid Hoffman:

No. And we didn’t know, and actually, that was the thing that then created a massively solid business model that allowed us our more, you know, kind of moderate pace, and how we build out the network; how we brought people on board; how we got the use cases developed; and everything else. Because we had the economics to sustain that, because of the selling-to-enterprise-model, which we knew was there as a possibility. But we thought it was a future possibility that would be after a bunch of other things worked out.

Ben Casnocha:

So I think this is—there’s a really deep idea here. Reid, you just said in passing this phrase: “We didn’t know and we were okay not knowing,” something like that.

And that’s really hard for some people to deal with. We really crave certainty in this world; we crave solidity. People have a very hard time with this idea that they might not know exactly who their customer is; they may not know exactly how their career is going to unfold.

And they often invent—part of why people I think invent these really rigid plans is ‘cause it gives them some degree of certainty. The problem is, it’s false certainty, which is even worse.

I’m thinking of, you know, Reid you recently gave a commencement speech at Vanderbilt—which everyone should check out—on friendship, the 2022 Vanderbilt commencement speech. David Brooks’ commencement speech a few years ago—I think it was at Duke—he said, “That feeling of uncertainty graduates that you have right now; make that feeling your friend, because it ain’t going away.”

And how you make the feeling of uncertainty your friend is, I think—is maybe one of the top three meta skills of a really interesting career. I’m intrigued by what the Buddha said 2600 years ago—the Buddha said that impermanence is a universal characteristic of all life experience, that there is nothing to hold on to, everything changes people. So you can summarize Buddhism in two words: everything changes. The entire canon of thought: everything changes.

So I think the idea that even some of our great spiritual and religious leaders have talked about the nature of uncertainty and impermanence speaks to just how core of an idea it is, but also how difficult an idea it is, like it’s one thing to sort of, say it here and listen to it on a podcast, but how do you really internalize this idea that the job you have today, the skill set you have today, may not last, even for another week, another month, another year, the rest of your life? And how can you be okay with uncertainty as it presents itself?

If you can make it that feeling your friend, you have a world of possibility ahead of you.

Reid Hoffman:

Yeah, and it’s part of the reason why we talk about, you know, how to take intelligent risk, which we’ll get to later. Because that is taking a risk, which has uncertainty, and risk always means it might not work.

But one of the things, I think, to really look at impermanence and uncertainty, is people tend to go either certainty—it’s exactly like, “The sun rises in the West, sets in the East; it does so at certain sets of times and so forth.” Or uncertainty: “Well, who knows? Maybe an asteroid is gonna hit the planet tomorrow.” And you’re like, “Well, actually in fact, there’s a whole range in between this.”

And so the question is assessing what kinds of uncertainty? Which kinds of uncertainty need to factor in your plans? And which kind can you be—no, no that’s okay. Right? Look, for example—

Ben Casnocha:

It’s probabilistically—

Reid Hoffman:

It’s probabilistically very remote, and it would be destructive to factor it in too much.

So, for example, if you said, “Okay, I’m aware of the statistics”—like one of the, you know, classic things is people are fearful of flying, but not fearful of driving because they’re more familiar, but—per mile—you’re more at risk by driving than you are with flying.

But if everyone every time they got in the car went, “Oh, my God, I don’t—I shouldn’t get in the car,” then in many societies, especially, you know, the US, Western advanced societies, that’d be very difficult to have your life without ever getting in a car.

Now, then even a nuance, you say, “Well, I’m actually really tired, or I’ve had a drink or something. Well, maybe I shouldn’t drive home. Maybe I should.” And that’s—and again, an assessment of what’s the level of uncertainty here? What’s the thing that is playing out? And that’s what we’re advocating.

And part of it is to stay away from false uncertainties, because, actually, in fact, things that have a low-risk factor that have a high yield are precisely the kinds of things investors want to buy.

And you want to steer more of your career towards…if you kind of go to only it’s like, for example, do you put your money in the stock market—which can go up and down, but overall goes up a lot—or would you put it in certificates of deposit? Right? Well, okay, the certificates of deposit, by the way, also not false certainty. There’s a bank and all the rest, but you will, “Okay. But I have a—I have within that envelope of a certain return,” but it’s a tiny one. And it would have been so much better the other way.

And that’s the parallel of embracing uncertainty, making it your friend. And there’s a set of things you have to do to get psychologically comfortable with that. Because, like, the majority—maybe even the vast majority of human race—-gets uncomfortable with that. Like, I get uncomfortable with that; you get uncomfortable with that.

It takes conditioning. It’s like, how do you end up running a six-minute mile? Not by accident, right? By work and by dedication. Some people do it more naturally. Some people do it much less naturally. Some people can’t get there. But it’s the developing that skill of “How do I navigate the feeling of uncertainty?”, and “How do I navigate the concepts around risk?” and “How I proceed on my plans and be strategic?”

Ben Casnocha:

It’s such a great point. I love the probabilistic thing because there’s such a thing as leaning too much into uncertainty, like there’s some things that are probably going to happen. And we can estimate them as such.

And I like the idea of it being a skill and there’s no shame if you’re scared of change or scared of uncertainty; no shame in that, that’s probably our default condition. I mean, some would argue like, you know, Buddhism, other places, that it requires nothing less than a spiritual undertaking to try to develop the skill. I think there are also some non-spiritual religious things you can do.

I mean one funny—this is sort of different, but related, but a self-talk that I’ve had my whole life for as long as I can remember—and it’s interesting, I’m curious, Reid, if this resonates, if you’ve had something similar, which is: anytime something bad and surprising happens to me, one of the first things I think is, “Well probably something good will happen next.” I’m very optimistic.

And similarly, when something really good had happened to me, and I get lucky, I’ll often make, “This luck’s gonna run out, like I can’t count on it.”

And I’m always trying to come back to some sort of equanimous zone. But when something bad happens, I think something good’s around the corner; when something good happens, I think something bad might be around the corner.

And I think it’s just a way of regulating my own reaction to the uncertain world. I’m curious if you’ve had a narrative in your head like that, or something else like that?

Reid Hoffman:

Well, it’s Ben’s karma psychic narrative. And so—because it is—

Ben Casnocha:

Yeah, it probably is literally, yeah.

Reid Hoffman:

And so, I’d say, similar-ish, although, you know, what I would say is, when something bad happens, I further just kind of say, “Okay, I may not have wanted this happen, but what can I learn from it? What is the way that I can amplify, I can adjust this into something, you know, turning crisis into opportunities; turning learning experiences that can be painful into things that you learn?” And it’s like, “What is the thing to learn from it?”

And, you know, something deep, not, “Never be in the situation again.” I mean, you know, which sometimes might be what you really prefer. But, you know, what is the way that you say, “Okay, what would you call your younger self?”, and not knowing facts, and so forth, but just a general way of navigating through life, kind of different heuristics that you would pursue.

And then, when something bad happens—or something good happens, that was the bad: to take a joy in it, but to recognize that there’s always some luck and fortune, which does have something of a karmic cycle, and try to figure out what are the ways that you can—like, for example, one of the things that’s really key, you know, Startup of You theme around entrepreneurship and so forth, is when you see an opportunity, grab it, run at it, because part of it is recognizing opportunities.

Like one of the things that entrepreneurs do is go, “Oh no, this is an opportunity. I need to drop everything and go after it right now.” And so recognize it—so sometimes something good happens, and you go, “Oh, my gosh, I have to like, go all in (on the poker analogy), or I have to, you know, like, double-down (on a blackjack analogy) and go at it.” And that sometimes is also the right response.

Ben Casnocha:

So, and what—if I can just go one more tangent here, and we’ll come back to ABZ planning—I’ve been thinking a lot recently about sort of self-love and self-confidence, and I noticed how many people don’t have much self-confidence or self-love.

And in fact, when something bad happens to them, like the crazy external event—who could have thought COVID would have disabled the hospitality industry for two years, and like, I’m thinking of people who I know, who like, you know, you start a hotel, or something in February 2020, and due to no fault of your own, the entire industry collapses.

What is the narrative you have in your head around that sort of black swan event, and that uncertainty? And I think people who are inclined towards depression or other things, studies suggest, will often personalize that and take ownership of like, “I screwed this up. This is my— I’m a bad person because something bad happened to me.”

And then on the flip side, people who tend to be more happy when something good happens, and then they tend to take credit for it: “This is my own good hard work,” right? “I made this happen.”

And I think there is something to staying psychologically sane in a very uncertain world where anything can happen; might require some element—self-delusion’s probably too strong—but sort of narrative in your head about, “Hey”—you said take joy in something that goes well—take joy, and pat yourself on the back.

And if something doesn’t go well, don’t beat yourself up over it necessarily; try to learn from it, maybe you did make a mistake, but sometimes just crazy stuff happens. It’s not your fault, you got unlucky, and play forward to the next opportunity.

Reid Hoffman:

And the specific way when I’m talking to myself or talking to other people is: try to make sure you’re making a good and genuine effort, ‘cause if you’re making a good and genuine effort, if something bad happened, well look, that was beyond your abilities. You were trying it, you were playing it well, etc.

And it was in—maybe your abilities will need to be stronger. Maybe you were unlucky in the world, unlucky in the market. It’s as it were, in the guilt language, not your fault. And you shouldn’t beat yourself up about it. Right? You should go, “Okay, what can I learn from this? What do I what I play forward?”

And then similarly, when it wins, it’s like, “Look, I did a good effort. I deserve some of the credit for this. Also, remember always a little bit that…in every major success, there’s a little bit of luck. So keep that bit of humility, and that bit of kind of like, “Okay, I recognize that I played well. I was smart about this. I took risk well. I really put in the energy, and that I have an alignness with my capabilities, but also there’s always still a little bit of luck.”

Ben Casnocha:

And have you always been this psychologically sort of adaptive or—from a young age, were you always somebody who could handle uncertainty, sought risks; when something bad happened, you got up, dusted yourself off for the next play? Or did you have to, yourself, develop some of these habits of mind that allowed you to be an entrepreneur and the way you are?

Reid Hoffman:

I think I had enough uncertainties of things that were going on in my childhood that it was necessary to develop it, but it would—became my way of developing. It was like, “Okay, how do you navigate this? Well, what are the things you do?”

Because by the way, you know, one of our central things is when, like, self-blame is not a unadaptive thing if you’re learning from it, and so forth. It’s unadaptive if what you’re doing is simply harming yourself, making yourself less capable. And it’s kind of like, well, what’s the point of self-blame?

Because it isn’t just to beat yourself up. The point is to say, “I should learn from this in order to do better.” And by the way, we want you to do well in the world, it’s a good thing. And you should want that for yourself, too. And, if you’re not wanting for yourself, you should go talk to your friends, therapists, you know, priests, whoever, and say, “Look, I should want this for myself, in a good way.” It doesn’t mean over other people. It means together with other people.

Ben Casnocha:

And you’re not alone. If you’re having those sorts of thoughts, you’re definitely not alone. There are books, therapists, coaches, other folks you can talk to; it’s such an essential psychological armament. For the world that we describe in Startup of You, you have to, I think, have some element of that argument to survive and thrive.

Reid Hoffman:

Different folks will have different reasons that will get them to the understanding that you should be having your own back, as well as having friends and allies that have your back, but you should have your own back on this stuff.

And that doesn’t mean blindly; that doesn’t mean that you can’t make mistakes. That doesn’t mean you respond to fear or uncertainty by being overly arrogant or, you know, other kinds of things.

But it does mean the, hey, as long as you are making a genuine effort, right, then you should give yourself that kudos of doing that. And then keep learning being in permanent beta, and being an infinite learner in order to ultimately do better.

Ben Casnocha:

So let’s talk about ABZ Planning as a framework, Reid. How do you flexibly plan, iterate, pivot?

We talked about Plan A, Plan B, and Plan Z.

So Plan A is, “This is what you’re doing right now.” The Plan A in your career is your current job; your current direction in life; your current implementation of your competitive advantage. So where are your skills, aspirations, your market realities; how that all comes together.

And you’re iterating within Plan A, but the best way to think about Plan A, as we write in the book, is: whatever your competitive energy is, hopefully that’s what’s been manifested in the world.

Now, Plan B is where there’s some interestingness to unpack.

So Plan B is the career plan that you should have, where you might pivot to if something changes. Something could change in your own life and career: “Oh, we have to move from San Francisco to Chicago, shoot”, or “Oh, some technology shift has happened that’s causing my skill set to be less relevant; I gotta change.”

So it might be something that you initiate. You might be bored in your current job. It could be externally imposed on you.

You know, we write that it’s not something that you need to write down really formally, and like put away and in a lockbox, because your Plan B—the right Plan B—will evolve and iterate as your Plan A iterates; as the world changes.

So it’s kind of something that you pay attention to maybe on a quarterly or yearly basis; you sort of step back and think, “Okay, if this current thing I’m working on doesn’t play out, what might be something else I could do that’s different, but related?”

And the way that we talk about Plan B, Reid, is about something that’s—where you can bring your assets or skills to the next thing.

And so, you know, in basketball, there’s this idea of pivoting—where you keep one foot planted on the ground, and the other foot can swing. And so it’s sort of something that’s adjacent to your current job.

So going from Product Manager at a tech business to owning a cupcake factory is not a pivot; it might be the right thing to do, but it’s not a pivot from Plan A to Plan B, whereas going from a product management job at a very large company, to a product management job at a startup would be a pivot. Or going from a product management job at a large company to a marketing job at a large company would be a pivot, right? It’s sort of different, but related.

Curious, Reid: have you ever pivoted to a Plan B in your career? Or how have you thought about your own iterations and adaptations as you’ve changed, the competition’s changed, and the world has changed?

Reid Hoffman:

I will answer that question. But another thing that’s important about thinking about ABZ Planning is also running experiments, and experimenting could be just a conversation, talking with people who know you, etc., could be doing stuff—that kind of experiment…experimentation of learning then also helps you sort out between decisioning.

But, you know, for me I’d say that in a number of times—like, for example, when I started my first company, SocialNet, my, you know, Plan A was, “Make SocialNet successful.”

My principal Plan B’s were other startups. And then I started going on walks with Peter Thiel and Max Levchin, and kind of telling them what I’d learned. And they said, “Well, we’d like you to join the board of this company that we’re going to pull together.” I was like, “Okay, that seems like an interesting thing to do, and—”

Ben Casnocha:

Wasn’t part of your life plan at that point. Opportunities. When opportunity knocks, you open the door.

Reid Hoffman:

Yep. And then, what I realized, and this is part of having Plans B, is to have—

And it’s not one Plan B. Most—this time people mistake is like—this like big construction project or military plans, it’s like, you pull out this thick tome: “And now we are in Plan B!”

And it’s actually—it’s a bunch of small changes, and it’s a bunch of information. It’s like, “Well, okay, so I’ll, you know, join the board of PayPal, and I’ll learn some things. And well maybe I’ll start doing more boards. Maybe board, you know, as it turns out, you know, being a venture capitalist, a board member; you know, maybe I’ll kind of learn some things that I will inform my next startup.”

As it turned out, it was my Plan B was to step off the board, join the company as COO, and help build the company. And that was because as my Plan A stopped working—

Ben Casnocha:

Plan A being that your own company that you were running.

Reid Hoffman:

Making a social network. I started going, “Okay,” and I reevaluated—and by the way, you reevaluate Plans B.

Now, joining PayPal became one of my Plans B, and that became the one that I chose in order to keep going at it. And part of that pivot in is not just, “Is the activity similar?”, but, “Is roughly your goal-set still similar in it?”

‘Cause it was like, “Well, no, I actually want to do technology startups. I want to do stuff that will go through the consumer internet and help millions to hundreds of millions of people’s lives. I want it to be a network-oriented, you know, property, because that’s one of the things I think I have a differential advantage and thinking about in order to make happen. And that’s what I’m essentially doing. And oh, look: I hadn’t really thought about payments, other than being— helping, you know, Max and Peter.” But actually, in fact, this is a central part of that. And that can be a good Plan B pivot.

Ben Casnocha:

I love it. I mean it’s different, but related, right? It was entirely different sort of business, but also related in that it was a tech business, and you were trying to have impact on tons of people.

You mentioned experimentation. I mean, this is—as everyone here knows, The Startup of You is all about looking at what entrepreneurs do, and creating incredible businesses, and applying those lessons to your career, and…when entrepreneurs are iterating through their business, they’re not pivoting randomly. They’re running experiments, they’re developing hypotheses, they’re testing things.

And so, if you’re early in your career especially, as you set a Plan A; as you develop a competitive advantage; and go land a job somewhere or start your own job, have some hypotheses about the work. You know, maybe a hypothesis is, “I like working in sales”, “I think I’m good at working at sales”, “I like traveling and calling on customers in person,” right?

Those can all be hypotheses that you should then test with experience. Do you like traveling around to Timbuktu to meet customers in person? Do you like the art of sales? Do you like the compensation structure? Like, test those hypotheses.

And you can even write them down if you’re inclined, and measure what you learn against those hypotheses. So be somewhat systematic—again, especially earlier on in your career as you’re experimenting and trying different sorts of career paths—have hypotheses, there’s nothing wrong if the hypothesis doesn’t play out.

And if you realize the hypothesis isn’t playing out—in other words, “Oh, gosh, actually, I took the sales job. I thought I like traveling, I thought I’d like sales. But you know what, this is not for me”—totally fine. You can iterate from there.

Nothing says just because you took a sales job means you have to be in sales the rest of your life. And as we’ve said now, multiple times in this episode, so many successful people, successful companies had an initial thesis and additional hypothesis that did not play out. And they had the presence of mind and the capacity to pivot away from it.

Reid Hoffman:

I think part of it is: don’t look at learning—or pivoting as part of learning and succeeding.

It’s like one of these expressions that a lot of people outside of Silicon Valley don’t learn the right thing is like, “Fail fast.” Well, failure isn’t the goal.

So, therefore, isn’t failing fast bad? The answer is: well, if you’re on a path that’s going to fail, failing fast is much better than failing long. And, if you fail fast, you can learn and adjust. So it’s test your hypotheses as quickly as possible, get some sense of it, in order to adjust.

So when like, for example, when you’re looking at your Plan A, be looking at what’s the things that are the most difficult parts of that? Can I test those? Can I experience those first? Because maybe I need to shift to a Plan B because of that.

And that kind of approach is not seeking failure, is not a lack of confidence. It’s a learning approach. And it’s a learning approach with, “How do I learn great and fast in order to achieve really interesting things?”

Ben Casnocha:

And don’t bet the farm. People think that entrepreneurs are these people and they start traditional businesses—or people that, you know, backed out their credit cards, and quit their job immediately and plow their life savings into the new business. That’s a terrible way to start a new business, especially in this world where it’s so much cheaper to test these tech business ideas.

You don’t bet the farm. We say in the book, “Bet the tractor, not the farm.”

Start it on the side. Literally if you actually want to start your own company, spend nights and weekends experimenting, testing hypotheses. If you’re in a sales job, and you’re starting to get the sense that sales ain’t for you, but maybe marketing is more for you, well do some marketing work on the side. Go hang out with some of your colleagues who are in marketing.

I think, Reid, you have a great experience at Apple or Fujitsu—can’t remember which—where you volunteered to do some product management work just to see if you were good at it. See if you liked it to sort of pivot into that functional area. So you didn’t have to quit your job and go apply to PM jobs; you can kind of navigate within your current job to get some adjacent exposure.

Reid Hoffman:

Yeah, it was at Apple. And part of the thought was I was working in the user experience group there.

I said, “Well, you know, look, I have some abilities and some skills here to competitive differentiation.” I was like, “Well, I have some things that are good, but I also lack a bunch of other things that other people are much stronger at. The Product Manager job seems to be a much better fit. How do I explore that?”

And so I went to the Director of Product Management there—guy named James Isaacs—and said, “Hey, if I construct some interesting, you know, product management documents—some PRDs—that you think would be interesting for us to consider, will you assemble a group and review and give me feedback on them?” and so forth.

And, by the way, it wasn’t so much with the: then James ended up becoming a reference for me, so that James had become a reference, but it was like the, “I’ll learn some about whether or not my theory about whether or not this would be something I’d be really good at” would do that. “I might up my skills ‘cause I’m getting feedback.”

And then as it turned out, I actually met a bunch of the PMs, and James liked the work and became a reference for my later job at Fujitsu doing product management. And so all of that came from—

Ben Casnocha:

So the Plan A was user design, user experience and the sort of pivot—if you wanna call it that—was to product management specifically. And you were able to do that by kind of volunteering for that work within the context of your user design job.

Reid Hoffman:


Ben Casnocha:

Yeah. Which is great.

So, question we often get from people is, “When should I pivot? How do I know it’s time?”

And, you know, I think you’ll never know for sure. You’ll never have full certainty; this is going back to the uncertainty point.

Life is very uncertain, mysterious. Unfortunately, we all live in gray. Make that feeling your friend. A mentor of mine once told me, “Pivot when you feel almost ready; not when you feel ready. You’ll never feel fully ready.” And he actually said this about any important life decision like getting married, having kids, things like that.

You’ll never feel fully ready, fully certain, so lower the threshold of certainty that you need to feel. And so if you have this sort of gut sense that, “Sales, this isn’t, this isn’t for me,” start putting in motion a plan to pivot.

Reid Hoffman:

I think your mentor is exactly right because, by the way, if you have gotten to the point of certainty when you’re pivoting, you’re pivoting much later than you should be.

Ben Casnocha:

It’s actually a funny twist on, you know, your quip of, “If you’re not embarrassed by the first version of your product, you’ve shipped too late. If you’ve made a decision by the time you feel fully certain it’s the right decision, you’ve made a decision too late.”

Reid Hoffman:

Yes, exactly. Yep. And that’s part of the right living at the right speed and learning in uncertainty. Now, one can be a little bit more systematic about kind of crosschecking it, ‘cause one of the problems about using the rumblings of your gut is that your rumblings of your gut might be instructive, but they can also mislead. You could have a bad day. You could lack confidence. You could be overly confident. There’s a bunch of different things.

And so part of how I try to systematize the pivot decision is I go, okay. Part of when you’re trying your Plan A, you’re trying a set of ideas in order to get there. And some of your ideas are not working out. Now, are your new ideas the same as or better as—than your old ideas, or are they worse?

And when you go, “Okay, I’ve now gotten a couple of the ideas that I’ve been working on and trying—are now less good ideas: less certain, less impactful, less ability to execute, more vague. They’re less good ideas than I had before. Now. I’m just working with less good ideas in how to make it.” That’s when you pivot.

And so it’s essentially—part of what I look is a decreasing confidence interval in your plan.

Ben Casnocha:

Yeah. Yeah.

Reid Hoffman:

So try to figure out what your confidence is, you know, roughly.

And then if you’re going, “My confidence is decreasing, not because I had a bad day, but just because actually in fact, when I kind of systematically look at this, then…Nope, that looks like I should shift.”

And that’s for example, one of the things I bring in terms of helping CEOs and founders on a board of directors.

Ben Casnocha:

Someone once told me that you should trust your gut in the negative, but not in the positive.

So if you have a bad feeling about something, it’s more reliable than if you have a really strong, positive association with somebody, ‘cause the positive gut is more influenced by things like physical attractiveness, other sorts of fantasies you might have about what your life might look like. Whereas the “Uh-oh something doesn’t feel right” feeling is more reliable. It’s a random theory.

Reid Hoffman:

If there was no other theory you could execute on, it’s probably a good one.

Ben Casnocha:

In the absence of others, but it’s a—I think to make this, you have to have a bundle of theories and frameworks.

Okay. So we talked about Plan A, Plan B. Let’s now close with Plan Z.

This is an essential plan, less understood. I think people understand what A and B usually is, but Z is really important. Z is the thing, the plan that you do if everything else falls apart. Z is what you do if a new COVID-19 pandemic strikes, and your industry gets shut down. Z is the fallback plan.

And I think it’s critical to have a Plan Z because we talk to a lot of people, Reid, who wanna be more entrepreneurial in their life, but can’t bring themselves to take a risk and plunge into the depths of uncertainty; to maybe start a business or maybe just find a new job, reinvent themselves.

And the reason they can’t, in my opinion, is because they are scared; they have a story in their head about what might happen if it doesn’t work out. And it’s because they lack a Plan Z, that they let their mind race contemplating how they’re gonna never be employable again, or how they’re gonna run out of money or etc. And so having a backstop psychologically—“Now, look, I can take risk in my Plan A and Plan B because worst case I fall back on Plan Z”—is super powerful.

Before you started SocialNet, you spoke to your father, God bless him, and developed a Plan Z with him. Do you wanna tell us about that?

Reid Hoffman:

Yeah. So—and this, you know, has a particular benefit, ‘cause it gets down to that applying these things to individuals in your careers.

I said, “Look, I’m gonna go start a company. I’m gonna put, you know, all of my savings currently into the company. I’m going to, you know, seek to raise money for it, etc. It might not work. In order to feel confident about going to essentially, you know, bankrupt, I wanted to know if it was cool with you in that circumstance and trying to do this. If that worked, could I move into the guest bedroom? I would then promptly go get another job. I would start paying rent, you know, for the thing—and then I would move out the moment that I had built up enough of a circumstance or, you know, if we were both happy then no, but like, I would then move out. Are you good with providing me this safety net?”

And he appreciated the fact that I had asked and just presumed, “Look, I think it’s good that you’re taking risk in order to make something happen. I like seeing you, so sure. You know, let me know if it gets, if you’re getting close to the line.” Right? “So I can adjust and make plans accordingly.” But that’s a good comment.

Ben Casnocha:

It’s a Plan Z that I think in America today, an astounding percentage of millennials move back in with their parents after graduation: student loans, challenging economy, etc., so it’s become a much more popular Plan Z since the days, I think, Reid, you first articulated it to your dad.

I mean, in the modern economy, a lot of Plans Z is gig economy, right? I’m gonna go drive Uber. I’m gonna go work at Starbucks, whatever. Like it doesn’t have to be a glamorous, high-status job. It’s a lifeboat you jump on to reload your asset base and be willing—and be able to play again.

Reid Hoffman:

And by the way, a key portion of it is to try to figure out—just a little bit, doesn’t have a lot—when do you know that when you need to start considering your Plan Z and when you need to trigger it?

Ben Casnocha:

And it is something—unlike Plan A and B, which are more dynamic, iterative. But, for Plan Z, this is something that should be pretty stable.

It should be something—it’s the extra guest room. It’s the stashed away savings account you can draw upon. It’s some thought about, “Oh, I’ll drive Uber or Lyft or deliver food for DoorDash or whatever.”

Reid Hoffman:

And by the way, if you had Uber/DoorDash, go get an account, try it once or twice.

Ben Casnocha:


Reid Hoffman:

Know what it’s like.

Ben Casnocha:

Great idea.

Reid Hoffman:

You wanna know, “Okay. I I understand how to get to my Plan Z. I understand that it can work for me.”

Ben Casnocha:

Yeah. And for a lot of people entrepreneurs, it’s often like people who start companies for a living it’s often, “Go get a job at more of a stable tech company that will pay a paycheck.” Right?

And so know that it exists, write it down, make sure it’s solid. Revisit it every so often. But it actually is the kind of plan you want to have sort of tucked away in the safe, and know that it can—it will be there for you when you need it.

Reid Hoffman:

Like, for example, the “go get a job at a big tech company”, a classic Silicon Valley thing.

Well, are you getting calls from recruiters. Right? Is your CV the kind of thing it is, and you’ve talked to a couple recruiters? Doesn’t mean you have to go through all the interviewing. You talked to a couple recruiters? Okay. I still have that as my Plan Z. Whereas you get no calls from recruiters, you better check your Plan Z to make sure.

Ben Casnocha:

Well, and I love—‘cause you’re hitting on both with that example and go actually set up the DoorDash account and do a few drives, you know, that you can.

It’s basically—you’ve put your finger, Reid, on an important dynamic, which is: you actually have to believe it, that it exists, that it’s real. Like you almost have to convince yourself that it’s real. Otherwise your mind will play tricks on you. It will prevent you from taking risk, right? Your mind will do almost anything to prevent you from living a life path that’s not the simplest, easiest path, ‘cause that’s not what we’re wired to—

We’re not wired to take risks, evolutionarily speaking. We’re just trying to procreate, propagate our genes, etc. So if you wanna live a more ambitious, entrepreneurial life, you have to be willing to take risk. And that means be psychologically okay with a Plan A or B that might fail, and know that Plan Z is there.

It’s safe. It’s real. It exists.

So let’s conclude with some practical tips, some action items, some “how how to invest in yourself” to develop your planning methodology, your ABZ Planning framework in your own career.

You know, first, just to reiterate: be clear in your own head, what is your current Plan A? It’s your existing implementation of a competitive advantage. You know, which in other words: a company hires me over someone else because dot, dot, dot; fill in the blank. What assets are you bringing to bear as aligned with your aspirations and market realities?

What might be some Plan Bs that you could pivot to? What’s in the adjacent possible? What are things that are different-but-related where you could bring your skill set and experiences, but succeed at something different?

And then finally, what is your Plan Z? What is that backup plan, that worst case plan if all goes to hell?

The second sort of tip that we wanna articulate relates to network. You know, so many of the themes in Startup of You connect to your network; you never do any of this stuff alone.

And one of the ways that you can use your network to think about ABZ planning—in addition to the obvious, which is get feedback on how they perceive your strengths and weaknesses and where you might be able to pivot—is to actually go and do some informational interviewing when you’re not looking for a job with people in your network, and understand some of the pivots that they’ve done.

Part of how I think pivoting and adaptation becomes more acceptable/easy for people is they realize how prevalent it is, right? And so if you go talk to people you know, and ask them to articulate the arc of their career, it might give you some comfort, like at a high level, and it might give you some specific ideas for, “Oh, I hadn’t thought about how I could maybe adapt myself in the way that Jane or John Doe did in my network.”

Reid Hoffman:

Yeah, I think it’s a particularly important thing to always be remembering, you know, it’s either the ‘we’, life is a team sport; and, you know, as you know, one of the things I most often ask myself when I encounter anything serious is, “Who should I talk to about it?”

Ben Casnocha:

Totally. So plan to adapt, ABZ Planning, an essential framework of The Startup of You.

Reid, thanks so much for your insights.

Reid Hoffman:

Ben, thank you, and thanks for our listeners.