Zynga founder Mark Pincus is the final speaker at Y Combinator Startup School 2009. My notes on his talk are below.
Pincus kicked off his talk by asking the audience how many wanted to become great entrepreneurs (much of the room raised their hand). But fewer raised their hand about becoming a world class CEO, which is something Pincus says they need to address.
Out of college, Pincus says he went into banking and then business school, after which he worked in major corporations. He says that sometimes entrepreneurs are born after finding that nothing lese works for them, explaining “I got kicked out of some of the best companies in America”.
Pincus’s first lesson: You should set a goal for what you want to accomplish. Pincus says he was Fred Wilson’s first consumer deal (”he loaned me $250k and gave me four months to do something”). He started FreeLoader. The company was acquired, but the CEO of the company that bought it “had a nervous breakdown”. At this point Pincus says he had his ‘greencard’ to be an entrepreneur.
Pincus said that after selling FreeLoader, he had some downtime — ”And then you get a new group of friends… A ghetto version of the show Entourage” — friends go out on Monday night at 1:30. But that gets old after a couple months.”
Pincus then started another company, called Support.com. “We created this service that nobody wanted, figured out quickly that nobody wanted it.” Pincus says that when you have a friend who has a ‘hairbrained’ idea that they think nobody understands yet — you may want to have an intervention. If you have an idea that can’t get funding, it may be a good idea, but it may be a bad idea. “What I would do is find five friends, give them your pitch, write a powerpoint as if you had $30 million in funding, and come back and tell me here’s what my service will be when this is spent.”
Support.com had core technology that let you clone old PC into new PC called MoveIt. Interviewed people on the street, and they wanted a way to move kids’ games to their new computer. So they actually had something people wanted, even if it wasn’t the core focus of the company.
Pincus says the second lesson he’s learned: not having a clear goal when you set out leads to death by a thousand compromises.
Death by a thousand compromises
Pincus says there’s no such thing as an independly controled company. Your VCs get some board seats, they say let’s both select an independent guy. You find out at the first board meeting the independent guy looks to the investors and says “it’s their money”. Someone else is running your company, and because he’s backing you and he’s a first time netrepreneur, you’re not getting the head of the firm. First day as the VC, and they’re proving themselves on you. And junior VCs are junior for a reason. If you have a conversation with John Doerr, he’ll say yeah, let’s do that. Junior guy is more nervous about the downside. So when you’re successful, they say this company is so valuable, you’ve never run a big company any more, so they talk about hiring a COO. Then you find out there is no world class COO who would work for a 20-something year old (except for Mark Zuckerberg). So then you have to make them CEO. Death by a thousand compromises. Pincus says after an ordeal like this, he was left with a public company that was profitable but he wasn’t fulfilled.
Pincus says he then went to Tony Robins (seriously). Attendees at the conference consisted of 4000 out-of-work realtors. But it works. Robbins says to set very high goals but take any path to get there.
With Zynga, Pincus says he wanted to make a company that put out a consumer service that would be around and would matter for a long time. As Tony Robins says, “Control Your Destiny”. In 2007, he says you don’t have the luxury of just building a feature, you have to build the whole thing.
Referring back to his issues with the board, If you’re profitable, you can control your board. He says we negotiate for the wrong thing because we don’t know what our goals are. “Who gives a shit what your valuation is? At the end of the day your valuation will be more impacted by a board made up by a bunch of old white men who show up once a month for half a day. It’s a lot easier if you just tell them what you’re going to do”.
Second Thing.
“You ought to all aspire to be a great CEO”. When you have a big company, you need to either find someone else to be the CEO, or you’re the CEO. He says the odds are more in your favor if you go to a company where you go to a company like Facebook, Zappos, or Zynga, where we help create CEOs.
On Fake CEOs:
Pincus says a fake CEO is someone who goes out, does talks and photoshoots, while something at the company is “on fire”. Says that he was supposed to be doing a talk at Harvard Business School, but canceled because he had to be there for the launch of Facebook’s changing News Feed.
Great stuff, but please…. Proofread your posts!
Going by the definition, Evan Williams is a fake CEO..
Great Article, Zynga are absolutely killing it in the virtual items at the moment, even I’m playing farmville, FML.
Seriously. Why can’t I stop playing Mafia Wars? I’m on level 920. Daily player. Join my Mafia! LOL
NO. Seriously. Join my mafia.
Zynga is the number one reason(from where I stand) that people are leaving Myspace for Facebook. I have a Myspace & Facebook account and I hardly ever use Myspace because my browser add-ons for Zynga don’t work for Myspace.
http://www.mysp.../zyngamafiawars
Wow. I read sooo much about Farmville these days. I even read a FML about it. That thing is going gang busters.
I’m actually scared to play it, because I have stuff that needs to be done. It seems so addictive. The buzz on that stuff is incredible. Who would have thought?
http://www.traderbots.com
Yeah he has short winnie!
Good post but you made some technical errors in the writing.
I changed all my plans to attend Mark’s talk on campus. At least he had a good reason for not showing up.
Hey — not like Yosi isn’t a good and talented guy, even if he flaked at freeloader (which i did not know)
true hustler 4 real…
Good one! I enjoyed it..
I watch the live feed and really enjoyed it. Interesting to hear him talking about his different experiences at different stages of his career.
Rubbish. Why should entrepreneurs want to be CEOs and vice versa? And why would anyone want lessons from Tony Robbins? Tony’s approach to ’success’ only works for about 3% of the people who pay thousands who attend his seminars. What if your product only worked for 3% of your customers? I’m not saying Tony is crooked, he runs a legitimate business. But it is based on hype and fluff, not reality. Being an entrepreneur takes much more than that.
Marc evidently falls into the 3%. Meanwhile, future NBA stars go to Nike camps. Explain to me again why they’re stupid to do that?
A friend of mine spent a year volunteering for Anthony Robbins. He’s now worth millions, and he credits Robbins for a lot of that. If 97% of people don’t have the drive or capacity to maximize what Robbins teaches, that means he’s… just like MIT.
(I’ve never been to a Robbins seminar, but it’s annoying to see people bust on something they know nothing about.)
VCs can be a pain.
isn’t this pincus guy the same that was being bashed all around in comments to previous posts – being called from crazy a**hole down to other unprintable niceties?
Doug:
What is the point behind the question ? It seems rather obvious to me that whoever has the burning desire to create something would want to see that through to its full reach.
pincus created tribe.net, a facebook wannabe…wonder why he didn’t mention that terd?
For the same reason Bill Gates never talks about Altair. Nobody asked.
f you play any Zynga/Pincus games: Farmville,Mafia Wars,Yoville, you are being scammed.FARMVILLE=SCAMVILLE http://bit.ly/29pPW6