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Entrepreneur Marc Lore has already sold two multi-billion dollar companies collectively. He now plans to do food delivery and take-out businesses He wonders Public in a few years with an ambitious estimate of $40 billion.
We spoke with Lore in person in New York recently about Wonder and its ultimate goal of making meal planning easy, but we also touched on Lore’s management philosophies. Below is some of what he said on the latter front, lightly edited for length and clarity.
Science is what is called Founder statuswhere founders and CEOs actively work not only with their direct reports but with “skip level” employees as well, in order to ensure that small challenges don’t turn into big challenges (Brian Chesky works this way, as do Nvidia’s Jensen Huang, Elon Musk, and Sam Altman, among many others):
Yeah, founder mode didn’t really resonate with me, because I work differently. I really focus on the idea of vision, capital and people. We have a meeting every week with the leadership team, and we spend a couple of hours every week just discussing the core elements of vision, strategy, organizational structure, capital plan, performance management systems, compensation systems, behaviors and values — like, things that you think are already set.
You’re like, “Oh, yeah, we’ve already done behaviors. We’ve already done values. We’ve already done performance management. We’ve got our strategy.” But when you’re growing and moving so quickly, it’s amazing how much it evolves over time, and you want to stay on top of it…and talk about it and talk about it.
When everyone is completely aligned and you have really good people, just let them run; I don’t need to share at all. So I don’t get into the details of what people do, as long as they know the nuances of strategy and vision. When you do it with your team, and they do it with their team, everyone moves in the right direction.
How Lauer thinks about hiring the right people:
I’m really all about hiring rock stars. Like, that’s everyone (I hire). I used to think you could interview someone and within an hour decide whether that person was a rock star. I really thought so, and I think others do too.
This is impossible. I have hired thousands of people. You can’t tell if someone is a rock star in a one-hour interview, and more often than not, you’ll get a honey pot. Someone talks a good game, looks good, says the right things, has the right experience, and then it doesn’t work out, and you wonder why.
I started going back to the resumes and trying to draw correlations, and what I found is that there’s a clear pattern that superstars have different resumes than non-stars. This doesn’t mean that someone who doesn’t have a distinguished resume can’t be a superstar. I miss these people, it’s okay. But when I see someone with a stellar resume, he’s always a superstar. When I interview them, I already know I want to hire them, and the goal is to make sure there’s nothing I’m missing from a behavioral, culture or values standpoint – we want to fit in there.
But a resume must show a demonstrable level of success in each job they’ve been in. This means multiple upgrades. It means staying at a company long enough to get a promotion, and it means that when you leave and move from one company to another, it’s a big step. Stars do not move sideways. They don’t go from a good company to a bad company, because bad companies need to pay more to attract people, so sometimes they get rid of people who are not good, who just want to make money.
But you find someone (at the top) 5% and you look at their resume, and it’s like: boom, boom, upgrade, upgrade, upgrade, upgrade, upgrade, upgrade, and then big jump… upgrade, upgrade, big jump. When I get that resume that shows that clear level of success, I take it and pay them whatever they need. It’s very important for me to get that star there. And you built a company of stars.
You need to have the right performance management system so they know exactly what they need to do to get to the next level. Because stars are highly motivated. They want to know what they need to do to get to the next level, especially Generation Z. They want to know and get a promotion every six months.
Finally, here Lore talks about his belief that taking greater risks is the way to secure a startup’s future, although this approach may seem counterintuitive to many:
People often underestimate the danger of the status quo and overestimate the danger of making change. I see it over and over again.
If you have a life-threatening medical condition, and the doctor says, “You have six months to live,” at that point, an experimental drug or something, even if it’s very serious, (would seem good). You are basically looking for opportunities to take risks, so as not to suffer that inevitable death.
If you’re healthy and everything is going well, and someone says, “Take this experimental drug; do this.” “It might make you live longer” (a lot of people will say), “You know what? It’s too risky. I’m really healthy. I don’t want to die from this drug.”
But startups are very different from big companies. When you’re at a big company like Walmart (which US e-commerce company Lore used to follow… sale It’s one of his companies), it’s all about incremental improvement. There is no incentive to take risks.
As a startup founder, you’re probably going to die. You’re probably going to die every day you live and do this startup. The probability is 80%, with only a 20% chance of this actually working. So you have to take that into account when making decisions. You should look for opportunities to take risks, to reduce the risk of death. The status quo is the worst thing you can do. Doing nothing is the biggest risk you can take.
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