Doug Leone, Former Sequoia Boss On Identifying Good Products, Businesses and People

Source: Invest Like The Best on Spotify

Why Listen To This?

Doug Leone led Sequoia Capital, for over 25 years after he was given responsibility for the firm by its founder, Don Valentine, in 1996. Alongside Mike Moritz, the pair managed its expansion from a single $150m early-stage fund into an $85 billion global powerhouse.

‘11 — Sequoia-type people
- Outlier people → Do extraordinary things.
- Never say “I was recruited by”. It shows that you’re lazy.
- Some things Doug is interested to know about a future Sequoia recruit:
  - Upbringing — Journey through life.
  - 3 adjectives to describe your sibling and then 3 adjectives that describe them by comparison.
  - Where would you get your best references? — A setup question.
  - Where would you get your worst references?
- The key is looking for people who are self-aware.
‘28 — The Merchandising Cycle
- The merchandising cycle helps you to identify what is wrong with the product.
- Components:
  - Product Management → What are we building? → Vision
  - Product Marketing → How are we positioning it? What is the story → Describe what we do in 3 words/1 minute/3 minute etc
  - How do we do the demand generation?
  - How do we do the sales?
‘31 — Components of Great Positioning
- Simplicity
- Cristal clearness
- Easy to understand
- Singularity of purpose → should have one genuine use case.
- Singularity of vertical market early on → When starting up, don’t try to build the entire vertical stack. Be at the bullseye and expand in concentric circles as you get your stand in the market.
‘46 — On Identifying Killer Genes
- Questions to be asked:
  - Have they taken risks early on?
  - Have they put their guts on the line?
- Having an up or forward attitude.