Self-made billionaire Reid Hoffman knows what it takes to be a successful entrepreneur.
The 57-year-old co-founded LinkedIn in his living room in 2002, and served as its CEO for most of the following decade. His professional networking platform now has a user base of more than 1 billion, and was bought by Microsoft in 2016 for $26.2 billion.
Hoffman has also been a board member at tech companies like PayPal, Airbnb and Microsoft. He co-founded Inflection AI, a machine intelligence company, in 2022. His experience has taught him that three traits stand out the most in a business owner with promise, he said in a recent podcast episode of “The Diary Of A CEO”: ambition, resilience, and awareness.
“Insanely great ambition” particularly stands out, Hoffman said. When choosing a founder to invest in, he’s drawn to someone with the mindset of “I’m shooting for the moon” and “If I’m successful, I will transform the industry.”
Such ambition can indicate that you’re willing to put forth relentless effort to make your ideas take off, even in the face of adversity. It can also mean you’re willing to exhaust all other options when your original plan doesn’t pan out, entrepreneur and investor Barbara Corcoran said on a 2023 episode of Barstool’s “Chicks in the Office” podcast.
It’s the first thing she looks for when contestants pitch her on ABC’s “Shark Tank,” she said.
Highly sought-after soft skills
Awareness, a highly sought-after soft skill, gives you the ability to understand yourself, those around you and your business more effectively, said Hoffman.
When investing in a startup, Hoffman makes sure its leadership has “an awareness of a good plan for how you might [transform your industry],” he said. ”[And] an awareness that entrepreneurship is a team sport, not an individual sport.”
Another “very important” trait that successful entrepreneurs share is resilience, or your ability to adapt and recover from stressful situations, said Hoffman.
“Almost every startup goes through what I call a ‘valley in the shadow’ moment,” he said, noting that he witnessed it firsthand at LinkedIn, PayPal and Airbnb. “Which is like, ‘Why did we think this was a good idea?’” Resilience can help you navigate changes effectively, with a focus on your organization’s long term goals.
You can train yourself for better mental resilience, Steve Magness, a performance coach who’s trained business executives and professional athletes recommended a trick backed by psychology: Use second- and third-person pronouns when talking to yourself, instead of first-person pronouns.
“Psychologists have found that when we use first-person pronouns (e.g., ‘I can do 20 pushups,’ or ‘We can get this project done in time,’) as part of our inner dialogue, we create a self-immersed world — and that’s not always a good thing,” Magness wrote.
Instead, he suggested, try telling yourself: “You can do 20 pushups” or ”[Your name] and her team can finish this presentation. They’re all so talented.”
“When we create psychological distance, our view of the world broadens. We can let go of the emotionality — seeing the world clearly for what it is, instead of letting it spiral,” wrote Magness.