Keith Rabois on the 3 most important lessons he learned from Peter Thiel

Let's start with boss number one, Peter Thiel. So what have you learned from Peter?

Sure. So I've been working with peter professionally for 23 years. And most of the lessons actually I Learned in week one of working with them in November 2000, and then I've applied them and remixed them. The most important one is in building a company, how to find the importance, first of all, of finding undiscovered talent and then learning how to do that. So theoretically, it's actually easy to explain why you have to scale a company using undiscovered you don't want to be competing with. Back then, we would talk about competing with Yahoo, Microsoft and Google for talent. Now actually, not even really Google yet. It was probably some other big company that failed. But fundamentally, you can't compete to assemble and marshal critical density talent by going after the exact same people that companies that generate infinite profits will pay and overpay for. Basically, Peter had a lesson that basically you have to hire people under 30. That was how he expressed it, because it was. And not to be ageist. The point was that by the time you're 30, anybody can apply.

You start being politically correct now.

Me, no. But legitimately, by the time you're 30, everybody who runs a hiring algorithm should be able to roughly come out with the same conclusion about someone's strengths and weaknesses. When you're really, really young, think like 18, like an intern. It's very difficult for organizations that run a homogenized hiring process to assess people. So there's a lot of alpha there. It's a little bit like for those of you who are sports fans, you draft athletes out of high school in the NBA. There's more alpha there than signing a free agent that's been playing in the league for 10 years. Everybody can look at the same film, same stats, and come to roughly the same conclusions. So Peter was like, you absolutely have to hire undiscovered talent. We can't afford to hire proven talent at the end of the day. Second value of time. People systematically, in Peter's words, undervalue their time. This has kind of become a mantra of my life. This is how I somehow invest in companies, run a company, teach Barry's classes, have babies, all at the same time is I am extremely disciplined about allocating my time. The value of each incremental minute. It's something I try to scale and teach other up and coming managers. But Peter really was the first one who instilled it in my brain. Many other lessons, I constantly remix stuff. It's not usually replicating Peter views. They've sort of become my own. The last one that's really valuable for founders is the value of focus. So Peter, like Peter can be, is an extremist. When he has a view, he takes it all the way to the polar extreme. So he had this mandate at PayPal about focus, that every single person in the organization, and this is a time we had 300 people in, let's say, the Bay Area and like 600 people in Omaha. Every single person in the Bay Area was allowed to do exactly one thing, literally one thing, including execs. And Peter would absolutely refuse to talk to you about any topic that was not that one thing, period. And he was the only one who's allowed to violate it. Of course, being Peter, he exempts himself from most rules, but fundamentally, the discipline of you're only allowed to do one thing led to significant breakthroughs. Because what basically happens is there's really hard challenges in any startup period. And it's easy to substitute your own time, your own attention to solving the ones you know how to solve. But those are not the breakthroughs. Those are not the 10x ideas. But when Peter would say to me, you need to fix this, and I literally won't talk to you for the next month or two until you fix it, would force me to bang my head against that damn wall every single day, go home, sleep, think about it, go in the shower, dream about it. And once in a while, it would lead to a holy cow, there's an answer. We can do this. Imagine that across an entire organization of 300 people, five or 10 ideas that probably wouldn't have happened are a direct result of Peter's management philosophy. I don't apply it with quite the same rigor. I wish I could. I allow people to push back at me too much. But I try to narrow it from one to three things, but it is an incredibly useful philosop.