Guy Raz: Five Lessons PMs Can Take From Famous Entrepreneurs

According to “How I Built This” podcast host Guy Raz, innovation happens when three things come together: a problem needs to be solved, a work culture encourages risk-taking, and there’s a shared sense of mission built around a shared story.

Sounds a lot like what it takes to build, launch, and run a successful product, too.

In his opening address to the crowd of product people gathered for the inaugural ProductCraft: The Conference earlier this month, Raz shared the stories behind some of the most popular brands in the world as metaphors for how to think creatively and foster innovation.

His mission is to inspire people, whether they’re building something in their garage, in business school, or in a conference room at work.  

And in fact, these stories have helped to shape his own journey. In just three years, the former NPR reporter has successfully created, launched, and grown a brand of podcasts with more than 19 million listeners every month. Now, his own team is following suit: the new show Throughline, launched by a pair of Raz’s producers at the end of January, is getting 300,000 downloads a week.

Raz imparted the ProductCraft attendees with a series of lessons learned from the stories of these famous entrepreneurs, each of which have exercised that formula for innovation. Here are the five lessons most relevant to PMs.

Listen to the Doubters With Respect, but Never Lose Sight of the Big Picture

It took eight years of testing and experimenting and 5127 different prototypes to bring the Dyson vacuum cleaner to life. Friends pleaded with founder James Dyson to let it rest. He took out a second mortgage on his home and nearly went broke. But Dyson was convinced he could reinvent the vacuum cleaner with an industrial strength suction and without the need for a bag. Years of persistence paid off when Dyson became the No. 1 seller of vacuum cleaners in Britain within two years of entering the market.

Raz shared a perspective from Dyson critical for PMs creating category leading products: as in running a race, Dyson realized that the moments when he wanted to give up were likely at the same points as when everyone else wanted to give up. He knew he had to accelerate instead. 

Focus on What’s Different, Special, or Better Than Anything out There

Advisors to Allbirds were concerned that launching just a single shoe design in only four colors was a recipe for failure. To succeed in the direct-to-consumer retail market, they’d need to provide options for shoppers, those experts said.

But founders and co-CEOs Tim Brown and Joey Zwillinger were most concerned with creating a superior product—an environmentally-friendly shoe made of superfine Merino wool. They were convinced that getting these values right would help them sell the shoes, and expansion into other types of shoes or products would happen from there.

They were right. Within 30 days of launch, they sold out of a year’s worth of inventory. Three years later, the company is valued at $1.4B, and according to Raz, still offers something better than anything else comparable. Allbirds ignored what the competition was doing and create a truly differentiated product.

Failure Is Your Friend

It’s hard to imagine Airbnb as an initial failure—today, it’s larger than the top five largest hotel brands combined. But founder Joe Gebbia had planned for a buzzy launch around the South by Southwest Festival in 2009 and only two Austin homeowners agreed to rent their homes using the service. Just Gebbia and another guy actually booked using the platform. And yet, that guy provided feedback that changed the trajectory of the business. It took too many clicks—10—to book the home, and the experience felt too transactional—he was forced to pay with a check at the end.

That feedback, born out of a perceived failure, helped inspire Airbnb’s focus on a frictionless experience. The team soon relaunched the platform to allow booking to happen within three clicks of a mouse, and transactions to happen online rather than in person.  

According to Raz, that failure inspired the innovation that changed the course of history for the company.

Always Be Ready to Pivot

Slack, now one of the fastest growing SaaS companies in the world, was born out of an epic pivot. Originally planned as a multi-player gaming company, the messaging platform was built as an internal communication tool for the company. When the game failed and the founders were winding down the company, they fielded a request from a friend to license that messaging system. It was no time before they had 80 customers and a whole new vision for the company.

Instinct may tell you to keep pushing on an original idea (and prior lessons above certainly point in that direction). But there are times when you’re pushing for the wrong thing and staying in a comfort zone that prevents innovation from happening. Innovating means being open to new ideas, fresh perspectives and opportunities to create an even more desirable and delightful product.

Act With Kindness; it Will Pay You Back Tenfold

Raz’s final lesson is his biggest one. Kindness manifests itself in different ways through Raz’s stories: fashion designer Eileen Fisher creates a work environment where everyone feels respected; New Belgium Brewing Company is employee-owned, giving everyone a chance to share in the company’s success; Away Travel partners with Peace Direct to spread peace-building around the world as they sell luggage and promote world travel. Raz told the New York Times last fall that he uses kindness as the leading criteria for the entrepreneurs who appear on his podcast. Like kindness is the precursor to sit with Raz, empathy serves as a rite of passage for PMs.

Effective product management requires many of the same traits as successful entrepreneurship, including persistence, creativity, grit, and empathy. As customer needs evolve and new problems arise, advice drawn from the startup world will become even more relevant to PMs. No matter their industry or market segment, today’s product managers should heed Raz’s advice to be nimble, flexible, and above all, kind.