How Playing Games Made Reid Hoffman $4.7 Billion
In a fantastic episode of The Tim Ferriss Show, Tim asked Reid Hoffman about how he developed such incredible strategic abilities as an entrepreneur. He is the co-founder of Linkedin (300 million users), and is known as “the Oracle of Silicon Valley”. Here is what he said...
In a fantastic episode of The Tim Ferriss Show, Tim asked Reid Hoffman about how he developed such incredible strategic abilities as an entrepreneur. He is the co-founder of Linkedin (300 million users), and is known as “the Oracle of Silicon Valley,” having early investments in Facebook and AirBNB. Hoffman has a net worth of $4.7 Billion, and President Barack Obama named him as a Presidential Ambassador for Global Entrepreneurship “to help develop the next generation of entrepreneurs.”
My favorite segment in the episode is when Reid talks about playing strategy games (see below transcript). This is one of more than 70 examples I’ve found of people with extraordinary careers who have attributed their skills and success to play.
How did you develop the ability to not only deconstruct a problem like that, but then to interface with all these various stakeholders at the table?
As a child I played a lot of Avalon Hill board games. And each board game is actually a complex set of rules and circumstances… So it was actually in fact my childhood gaming — for being able to build a model of what a game was — that was essentially the fundamental thing that informs my strategic sense.
If you were giving advice to someone leaving undergrad and they had no gaming background, what would you recommend they do to try to develop strategic ability or thinking?
Most people think that they are better at strategy than they are, so you really… have to have a very deep self-awareness of, “Am I in fact really good at it?” … A real strategy is actually built up off: what are your competitors doing? What is their mindset? What are their assets? How are they going to move? How are you going to move? What are your edges? What’s the way that you can make that work? So games are a very good way to do that.
Getting a lot of different exposure… not to computer games, because computer AI strategies are usually not that interesting… but against other people, is very useful… To think about what are the set of principles that when you’re thinking about how to win a game that in contention, in conflict… A lot of people of course have some sports knowledge on this, too.
One of the things that’s a little limiting on sports is that the sport game that a person tends to play, they tend to be like, “I play soccer, I play football, or I play basketball.” And then they have a very deep sense of what the strategy is there, but they haven’t played enough different kinds of games, enough different circumstances. It’s like understanding, “What happens if I change these four rules in basketball?” How would you play the strategy now? You have to figure out what a current game looks like then. How do you play that?
That’s the reason why companies rise and fall, because they learn to play one game, they get good at it, and then the marketplace changes. And now it’s a new kind of game, and you have to adjust to playing that new game. That’s actually part of recognizing when a strategy applies.