High-alpha vs low-beta: hiring and process fit

Matt MacInnis is the chief product officer and former longtime COO at Rippling, a unified workforce management platform valued at over $16 billion.

We discuss:

1. Why “extraordinary results demand extraordinary efforts”

2. Why you should deliberately understaff projects, and how to know when you’ve gone too far

3. Matt’s transition from COO to CPO and what surprised him about leading product

4. The “high alpha, low beta” framework for evaluating people, processes, and products

5. When founders should quit their startups (hint: much earlier than VCs want you to)

6. How to fight entropy in your organization through relentless energy and intensity

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Transcript: https://www.lennysnewsletter.com/p/10-contrarian-leadership-truths

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My biggest takeaways (for paid newsletter subscribers): https://www.lennysnewsletter.com/i/181916584/my-biggest-takeaways-from-this-conversation

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Where to find Matt MacInnis:

• X: https://x.com/stanine

• LinkedIn: https://www.linkedin.com/in/macinnis

• Email: macinnis@rippling.com

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Where to find Lenny:

• Newsletter: https://www.lennysnewsletter.com

• X: https://twitter.com/lennysan

• LinkedIn: https://www.linkedin.com/in/lennyrachitsky/

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In this episode, we cover:

(00:00) Introduction to Matt MacInnis and Rippling

(04:38) The importance of extraordinary efforts

(08:37) The challenges and rewards of relentless effort

(10:11) Your job as a leader is to preserve intensity

(12:39) You learn far more from success than failure

(16:34) Transitioning to chief product officer

(19:54) Fixing product management at Rippling

(25:27) The “high alpha, low beta” framework

(28:55) The PQL framework

(35:16) Hiring frameworks and team dynamics

(36:52) A helpful interview tactic

(40:00) Leading as a COO vs. a CPO

(42:34) The reality of product-market fit

(46:38) The problem with venture capital

(49:29) When founders should quit their startups

(41:48) The immutable market

(54:13) Lessons from Notion’s success

(57:43) Investment strategies and narrative violations

(01:00:42) The power of compounding, power law, and entropy

(01:07:02) Maintaining intensity and fighting entropy

(01:11:33) The importance of feedback and escalations

(01:14:31) Rippling’s vision and success

(01:17:48) AI’s impact on SaaS and business software

(01:23:42) AI corner

(01:26:23) Final thoughts and lightning round

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Referenced:

• Rippling: https://www.rippling.com

• Sunil Raman on LinkedIn: https://www.linkedin.com/in/sunilraman

• Dan Gill on LinkedIn: https://www.linkedin.com/in/dangill

• Carvana: https://www.carvana.com

• Brian Chesky’s new playbook: https://www.lennysnewsletter.com/p/brian-cheskys-contrarian-approach

• Parker Conrad on LinkedIn: https://www.linkedin.com/in/parkerconrad

• Inkling: https://www.inkling.com

• Akshay Kothari on LinkedIn: https://www.linkedin.com/in/akothari

• Notion: https://www.notion.com

• Conway’s law: https://en.wikipedia.org/wiki/Conway%27s_law

• Seeking Alpha: https://seekingalpha.com

• Dennis Rodman’s website: https://dennisrodman.com

• Dancing pickle emoji: https://slackmojis.com/emojis/456-dancing_pickle

• Pickle Rick: https://en.wikipedia.org/wiki/Pickle_Rick

• SPOTAK: The Six Traits I Look for When I’m Hiring: https://finance.yahoo.com/news/spotak-six-traits-look-m-181335267.html

• Geoff Lewis on LinkedIn: https://www.linkedin.com/in/geofflewis1

• Zenefits: https://en.wikipedia.org/wiki/TriNet_Zenefits

• New banking records prove Deel paid thief who stole trade secrets from Rippling: https://www.rippling.com/blog/new-banking-records-prove-deel-paid-thief-who-stole-trade-secrets-from-rippling

• Workday: https://www.workday.com

• Matic robots: https://maticrobots.com

• Wall-E: https://www.imdb.com/title/tt0910970

• Conviction: https://www.conviction.com

• Mike Vernal on X: https://x.com/mvernal

• Sarah Guo on X: https://x.com/saranormous

• No Priors: https://linktr.ee/nopriors

• Gemini: https://gemini.google.com

• ChatGPT: https://chatgpt.com

• Claude: https://claude.ai

• Bryan Schreier on LinkedIn: https://www.linkedin.com/in/bryanschreier

• Heated Rivalry on HBO Max: https://www.hbomax.com/shows/heated-rivalry/50cd4e99-04ee-427b-a3b4-da721ed05d9c

• Fellow coffee maker: https://fellowproducts.com/products/aiden-precision-coffee-maker

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Recommended books:

• Pale Blue Dot: A Vision of the Human Future in Space: https://www.amazon.com/Pale-Blue-Dot-Vision-Future/dp/0345376595

• Conscious Business: How to Build Value Through Values: https://www.amazon.com/Conscious-Business-Build-through-Values/dp/1622032020

• Thinking in Systems: https://www.amazon.com/Thinking-Systems-Donella-H-Meadows/dp/1603580557

• The Effective Executive: The Definitive Guide to Getting the Right Things Done: https://www.amazon.com/Effective-Executive-Definitive-Harperbusiness-Essentials/dp/0060833459

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Production and marketing by https://penname.co/. For inquiries about sponsoring the podcast, email podcast@lennyrachitsky.com.

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Lenny may be an investor in the companies discussed.