Book · How companies get built

The Hard Thing About Hard Things

Name: The Hard Thing About Hard Things
Author: Ben Horowitz

Ben Horowitz · 2014

An unusually honest account of running a company through the periods when it is going badly — the part every other business book skips.

Why it is here

Most books about company building describe the growth. This one describes the near-death experiences: layoffs, demotions, running out of money, selling a business you had hoped to keep. It is written by someone who did those things before becoming an investor.

For an angel the value is calibration about what your founders are actually experiencing in years three to five, which is when your portfolio's losses cluster. Founders in that period are frequently not telling investors the whole picture, and this book explains what they are carrying.

It is also useful for judging how founders talk about difficulty. Someone who has read this and internalised it discusses problems differently from someone performing confidence.

Read it if

You want to understand the years of a company that investor updates do not describe.

Skip it if

You are looking for frameworks. This is closer to a memoir with advice attached.

Pair it withBillion Dollar LoserReeves WiedemanHow WeWork reached a $47bn valuation and lost it in weeks once public-market disclosure made the economics visible.

What it explains

Terms this covers

Bridge roundA short financing intended to carry a company from where it is to a larger round or to profitability, usually raised from existing investors on convertible paper.Down roundA financing priced below the company's previous round, which dilutes existing holders disproportionately and typically triggers anti-dilution adjustments in favour of earlier preferred investors.Pay-to-playA provision that strips investors of their preferred rights — usually by converting their shares to ordinary — if they decline to invest their pro-rata share in a future round.