Shaun Maguire is a partner at Sequoia, has founded two companies (one in space technologies and another in global internet security) and holds a PhD in physics from Caltech. As a teenager, he played in the world’s top league for the video game Counter-Strike—and got an F in Algebra II.
What advice should first-time founders heed?
A friend of mine has a saying: “When there are doubts, there are no doubts.” I think that’s good advice when it comes to deciding whether or not someone is additive to your culture; if you’re having doubts about their role in the company, it’s probably already time to part ways. That’s especially true early on. If you’re the size of Google, you can’t reasonably expect everyone to be a perfect fit. But when you’re a small startup, you really can’t afford to have someone who isn’t pulling their weight.
Waiting too long is such a common mistake among founders, and it’s easy to understand why. Our bias is to be generous and gracious and give someone time. We’re empathetic. But if you have someone on the team who’s pulling down morale or even making it harder to recruit, that can damage the trajectory of the entire company. It’s much better to take action quickly.
What question are you asked more than any other?
I get a lot of questions about interpersonal dynamics—everything from conflicts between co-founders to thinking through the psychology of a sale from the buyer’s perspective. Often it’s one-on-one, like when a founder is going through a low point. Just being an ear for someone in a situation like that can make a big difference. I try to help them focus on the three things that matter most for the next month or quarter, or just offer them a more objective perspective. If the company is low on cash, for example, and they’re under a lot of pressure and considering giving up, but I know they have a great product, I might be able to defang their fears; I can keep them from overreacting in a way they’d later regret. Sometimes quitting is the far bigger risk, because you’ll always wonder what could have happened. But if you keep going, the worst case scenario is that you’ll be in essentially the same position a few months from now—and the best case scenario is that those few months make all the difference.
What experience shaped who you are?
When I was younger I spent a lot of time backpacking, probably two or three years cumulatively. I’ve been to more than 90 countries. Most of it was pretty off the beaten path—places like Paraguay, Latvia, Kazakhstan—and I was by myself, sometimes hitchhiking, living on 10 dollars a day. I didn’t know the language, and this was before iPhones, so there was very little communication. I think it kind of rewired me on a fundamental level. It taught me to roll with the punches. I spent one night sleeping in a meadow in Syria. I got stuck in the Chaco desert for a day and a half with no water after our bus broke down. You learn to just figure it out.
I also learned to be much more trusting. Maybe 0.1% of the time someone will try to take advantage of you, and you do have to be prepared for that. But 99.9% of the time, if someone you’ve never met invites you to their house for dinner, it’s going to be one of the best meals of your life. When you’re not willing to trust, you end up missing out on a lot of amazing opportunities.
What’s the best interview question in your toolbox?
I just ask “Why?” It’s my follow-up question for everything. I think I really learned that as a VC, but I wish I would have done it more when I was an operator, too, because it’s such a good way to get past the canned responses. When you ask “Why did you make that decision?” or “Why did you do it that way?” it helps you understand how someone thinks. They drop clues that are far more important than the answers themselves.
And eventually, you start to pick up on patterns among the people who do and don’t work out. Are they intrinsically motivated? Are they curious? I try to understand what drives someone in their life in general, because that tells you so much about how they’re likely to perform in the company.
What book should every company-builder read?
One that was very influential for me was Adventure Capitalist, by Jim Rogers. He’s a very well-known investment banker and hedge fund manager, and the book is the story of two years he spent traveling the world, trying to essentially benchmark the global economy. He did all these fascinating, creative things to try to find leading indicators. Like in every country he went to, he’d try to open a bank account, buy a share of stock, talk to a real estate broker about what it would take to for him to buy property there.
The book was published in 2003, and he completely nailed, among other things, the rise of China as a top place to invest over the next decade. I actually started investing there pretty heavily after I read it, even though I was still in high school. But the broader takeaway for me was how to approach thinking about things like that in the first place—it was one of the motivators for my own trips—and I think there’s still a lot of utility in that for someone reading it today. Just being scrappy, coming up with your own metrics and indirect ways to measure things, is a very powerful idea.
What’s a lesson you learned the hard way?
To keep my cool. I remember once in high school, I got a zero on an exam even though I’d answered every question correctly, because I didn’t show my work. I was 14 years old and arrogant and hadn’t yet learned empathy. So instead of saying to my teacher, “Oh, you probably thought I cheated. Is there any way I can improve my grade?” I got angry and abrasive and stopped going to class. It made me feel good at the time, but ultimately I got an F and had to do way more work in the long run. I would have been much better off staying calm.
I think the same is true in business, even when you have a legitimate reason to be angry. Maybe you’re in a negotiation and someone’s clearly trying to take advantage of you or the company or one of its employees. It would be easy to let out that steam, but that just makes getting to the right outcome even harder. It stops being about getting the best terms for both sides and turns into a prisoner’s dilemma, where everyone’s working against each other. If instead you stay calm and say, “I hear you, but I don’t think that’s going to work for us,” there’s still a possibility to turn it around and come to a mutual agreement.
What invention do you hope to see in your lifetime?
Faster-than-light space travel, which I do think will be possible someday. Our understanding of physics is still nascent, but we’re making great strides. Exploring the stars has always been a dream of mine. I grew up watching Star Trek and Star Wars and I’ve been obsessed with space since I was nine years old. I was so obsessed with it that I did a PhD in quantum gravity!
Achieving that breakthrough would also give me a lot of optimism for humanity in general, because I personally believe that eventually, we’re going to have to become a space-faring species. Maybe not to survive the next hundred years, but certainly the next thousand. Plus, humans are at our best when we’re exploring. It’s a very unifying experience.
- Find your own metrics
- Keep your cool
- Always ask "Why?"
— Shaun Maguire, Partner, Sequoia