Irrational Desire, Not Money, Sustains Founders

The most valuable leadership decisions are the ones most people disagree with. This is where true leadership emerges, in the moments of choosing between difficult options when hesitation would be fatal.

Ben Horowitz believes the worst thing a leader can do is hesitate on decisions. When faced with two terrible options, the psychological muscle you must build is the ability to "click in the abyss" and recognize which path is slightly better. This is particularly challenging because the only value you add as a leader is when you make decisions that most people don't like—if everyone agrees with the decision, they would have made it without you.

This principle was exemplified when Horowitz took Loudcloud public with just $2 million in trailing twelve-month revenue at eighteen months old. While obviously risky, the alternative was bankruptcy. The Wall Street Journal wrote a story about how stupid he was, and Business Week called it "the IPO from Hell." Yet it was the right call—many CEOs who hesitated during that period in 2001 went bankrupt.

For founders and leaders, confidence is the critical factor. When you invent a product and suddenly become CEO without having run a large organization before, you inevitably make expensive mistakes. These mistakes can cause you to lose confidence, which leads to hesitation on the next decision. This hesitation creates a dangerous vacuum where senior people feel they need to jump in and make decisions for you, creating a political, dysfunctional organization.

The practical implications for leaders:

1. Run toward fear and difficult decisions rather than avoiding them. The conversations you're afraid to have are usually the most important ones.

2. Don't expect to get most decisions right. As Horowitz puts it, "The median on the CEO test is like 18, not 90." You'll get many D-minuses, and that's fine as long as you avoid the F's.

3. Focus on your strengths and the strengths of others rather than fixating on weaknesses. Judge people on what they can do, not what they've done wrong.

4. Understand that leadership isn't about having every idea yourself—it's about consolidating good ideas, prioritizing them, and getting everyone aligned with high fidelity.

5. Recognize that self-evaluation matters less than action. As one of Horowitz's managers told him: "No credit will be given for predicting rain, only for building an ark."

The path to success isn't a single brilliant decision but a series of small, difficult choices that compound over time. Each good decision, however hard, leads to the next one. This is why running toward problems rather than avoiding them is essential—it's the only way to build the psychological muscle needed for effective leadership.