Napster Founder Shawn Fanning: Why Leaders Must Have the Hard Conversations Early

There's an area of kind of choosing co-founders and managing partners and as you grow your team or choose to work with people, there are decisions there especially early on that are critical. And so the sort of the main thing that I learned firsthand that has saved me so many times has to do with having the difficult conversation upfront. So the best example of that would be something like working out equity, if you're working on a project. It comes up all the time, especially with co-founders or projects that are maybe not as serious when you get started. Maybe it's purely a fun side project and you just want to kind of work on it and have fun, you're excited to be— Sorry. You're excited to be working on it, and you don't wanna be greedy and thinking about ownership in something that has no value. But the reality is, so many times those projects become the most interesting and the most lucrative, and you get to a stage down the road where it turns out everyone had a completely different idea or understanding of what the structure would be. And that's one of the most difficult things. situations to find yourselves in. So for me and for some of the entrepreneurs I've worked with, one of the things I've really tried to encourage is this idea of really training yourself, however you need to do it, to have those difficult conversations right away. And so being non-confrontational myself, and I know a lot of engineers tend to have similar traits, you've got to find some way to— You're not a people person. Enjoy the experience or to look at it as, you know, I mean, for me, what I do is I basically say, you know, this is preparation for a much bigger, scarier person that I'm gonna have to kind of, you know, deal with down the road. So for me, I usually imagine, you know, a future negotiation or, you know, another challenging circumstance that would, you know, make this particular conversation seem a lot easier. And that saved me many, many times. I can tell you, are you guys familiar with the company Path? I don't know if you guys use Path at all. Yes. Path is a company I started with Dave Moore and Dustin Moreau and we had a buyout offer from Google, which was an obscene amount of money for a company that had not launched or had any real traction and the things that ensued following that acquisition offer were absolutely As it relates to all the stuff I'm mentioning now, it touched on almost every single one of these. In reality, it was kind of a crazy 4-year deal where you're basically taking a job. But the reality of the circumstance was that that entire company had been so focused on its public launch and managing perception and dealing with a number of the marketing issues and things that really the founders had kind of lost touch with each other as far as what their objectives were around, is this about building a real big lasting business or just kind of making some cash? That was a company where having not worked through a lot of this stuff caused a huge, huge problem among the founders and in the end caused a big falling out among some of the people who I would say are some of the more influential angel investors and some of the the more well-known entrepreneurs in this world. So despite the fact this seems like pretty obvious or simple stuff, it's stuff that it's easy to overlook and will in the end, you know, it can haunt you.