Ben Horowitz explains the two things every successful technology startup must do

So what do you need to build a new technology company? I think there's really two things that are very consistent with every good one that's ever been built. Number one, you have to build a transformational product. There is no way to build a great new company without a great new product. Because I'll tell you now, Microsoft, IBM, Hewlett Packard, they can all hire people, they can all train people, they can all sell, they can all market. What they all have trouble doing is innovating, coming up with something like truly new, truly transformational. And it's got to be way better than what's out there or way better than the current way of doing things. And if you have that, then you have a chance of building a company around it. But without that, you're not going to get anywhere. So products matter. That's the first thing. Because you'll hear a lot of people say what's really important is a business model, or what's really important is marketing, or what's really important is this or that. But what's really important is the product. That really is the main thing. If you look at the great technology companies, the thing that distinguishes them is the ability to keep coming up with a better way of doing things. The second thing that you need to do is you need to take the market. And by taking the market, you have to win the market so you can come up with the best product. But if you don't win, you really don't have a company. Most of the technology business are network effects business. You have to win. And when you think about, if you're an engineer, what business skills do you need to build a technology company? They're all around the skills you need to win the market. How do you out market outsell and beat the competition? That's ingredient two, and those are the two things that really matter. Can you build a product that's better than anybody else's and better than the current experience by enough that people will actually change? And then two, do you take the market? Do you beat the competition? Do you build a good enough company that you go win?