Lenny Distilled
Strategy → Prioritization
70% of your building time should really be going to your core product, that has product market fit. 20% of your time should be going to strategic initiatives that aren't core, but they're strategic to the company, that you know have to do them. And then, 10% of your time should be going towards bets.
As a general rule, as a general principle, I certainly try to make sure that we're always reserving some capacity for bold, audacious experimental research projects. You can think of those really uncertain bets as being five to 10% of the team's capacity. About 25, maybe 30% of the team's capacity should generally be on just operations... and then the remainder of it, what is that, about 60% or so, is really on incremental progress.
You have to allocate sometimes to these high risk, high reward ideas. We're going to try something that's most likely to fail. But if it does win, it's going to be a home run. And you have to be ready to understand and agree that most will fail.
If you are the leader in some core product, our takeaway here is you should continue to out invest everyone else in that core and then invest the profits that come out of that core into the next venture. Invest profits and not people, or venture capital, which is maybe net present value of profits or something to that effect.
The issue for us at the time was that we took people away from the investment in our core product to go do those other things. We moved people, right? And so the trap there is that you leave yourself ripe for disruption in your core because someone else can out invest you in that core.
There's not that many people that need the sixth best CDP or the eighth best feature flagging or the 10th best message targeting tool. And it ends up being, in aggregate will contribute five to 10% to your revenue, won't seriously accelerate your growth rate, and then takes engineers away from the core product.