20VC DoorDash CEO Tony Xu on The Art of Great Leadership Today, Why The Best Give All of the Credit and Take All of the Blame & How DoorDash Have Won The Best Talent Against the Toughest Competition

In this episode, the host welcomes Tony Xu, CEO and co-founder of DoorDash, who shares insights into his journey from working at Square and eBay to launching DoorDash—a platform that empowers merchants through on-demand delivery and data-driven insights. Xu reflects on the pivotal moment inside a Palo Alto macaroon store that sparked DoorDash's focus on delivery challenges for small businesses. He discusses his parents' influence on his work ethic, the importance of resilience, and how becoming a father reshaped his perspective on time management and problem-solving. Xu also touches on leadership, advocating for a culture of followership and the ability to lead by example. He emphasizes the significance of recruiting, aiming for diversity, and the continual evolution of company culture. Throughout the conversation, Xu maintains a focus on the long-term vision for DoorDash, striving to build a vast local commerce app and platform, and ensuring that his team can do their best work within the company.

• Tony Shu is the CEO and co-founder of DoorDash.
• DoorDash offers on-demand delivery, data-driven insights, and improved in-store efficiency for merchants.
• Tony raised funds from notable investors like Sequoia, CO2, Softbank, Kleiner Perkins, DST, and CRV.
• Prior to DoorDash, Tony worked at Square, eBay, and McKinsey & Company.
• Acknowledgments to individuals from Pear, Kotu, Sequoia, and CRV for their contributions to the episode's schedule.

"I'm going to dive straight into it because I'm too excited for this one, so I'm thrilled to welcome Tony Shu." "Now, Tony is the CEO and cofounder of DoorDash, the company empowering merchants to grow their businesses by offering ondemand delivery, data driven insights and better instore efficiency."

These quotes introduce Tony Shu and highlight the core services of DoorDash. The speaker expresses excitement for the episode featuring Tony and the impact of DoorDash on merchants.

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• The founding moment of DoorDash occurred in a local macaroon store in Palo Alto.
• The team encountered a store manager unable to fulfill hundreds of delivery orders.
• This experience highlighted the challenges faced by physical businesses, such as customer acquisition, relationship maintenance, and customer service.
• DoorDash initially focused on solving the delivery problem for these businesses.

"I wish there was one aha moment that happened over 20 seconds or something, but I guess if there was one, it really happened inside of a local macaroon store in Palo Alto, where the founding team met a store manager who had to turn down hundreds of deliveries."

This quote explains the pivotal moment that led to the creation of DoorDash. It emphasizes the real-world problem of delivery logistics that DoorDash aimed to solve.

• Tony's parents' work ethic significantly influenced his approach to work and life.
• His parents' consistent effort and positive productivity demonstrated the value of relentless effort.
• Tony's independence from a young age taught him resourcefulness and adaptability.

"When I think about my parents journey into this country, it kind of is that classic immigrant story where dad was getting his graduate degree. Mom was putting food on the table because we had a couple of. She worked three jobs a day for twelve years to make things happen."

The quote reflects on Tony's parents' dedication and hard work as immigrants, which instilled in him a strong work ethic and a sense of relentless effort.

• Tony has two young children and is still learning how fatherhood impacts his life and work.
• Fatherhood has reinforced the importance of time management and the value of a beginner's mind.
• Tony aims to allow his children to explore their curiosities and learn from their experiences.

"Well, I'm still trying to figure it out. So I have two young kids. And so I think even though I've had two times to have tried to impart or learn lessons, I think so far it's really reinforced, one, what's important and where to really make sure I get great return on time."

The quote expresses Tony's ongoing learning process as a parent and how it influences his perspective on time and learning.

• Tony reflects on how to instill work ethic and ambition in his children despite growing up in different financial circumstances.
• He believes in allowing children to pursue their interests and learn from their mistakes.
• Tony emphasizes the importance of earning and the challenges of teaching resourcefulness.

"Nothing was ever pushed on me. I don't think they even ever saw my report card, maybe ever actually, all the way through college, graduate school, and certainly not in my earlier years."

This quote highlights the hands-off approach Tony's parents took, which he believes allowed him to develop his own interests and work ethic.

• Tony's leadership is characterized by a strong followership, not just the number of direct reports.
• He is continuously learning about leadership and believes great leadership results in people wanting to follow.

"I think maybe the succinct way, when I've seen great leadership, I've noticed, is there is great followership."

The quote defines great leadership by the presence of followers who choose to support and follow the leader, indicating the leader's influence and effectiveness.

• Leadership is not solely about having direct reports; it's about influence and how one presents their work.
• Being the first to act and "leading from the front" is a core practice at Doordash.
• Leaders at Doordash engage in all aspects of the business, including deliveries and customer service, to understand and solve problems effectively.

"In fact, when I think about even people at Doordash, there are many leaders at the company that have zero direct reports, but have lots of followers because of their influence and because of how they show up and how they show their work."

This quote highlights that leadership is defined by influence and action rather than hierarchical position. It emphasizes the importance of how leaders conduct themselves and their work.

• A leader should know the details but allow those closest to the problem to make decisions and own outcomes.
• Creating a safe environment involves the leader taking the blame and giving the credit.
• This approach encourages team members to take risks and lead ambitiously without fear of failure.

"And I think the easiest way to do that, as the leader, is to give all of the credit and take all of the blame."

The quote suggests a leadership strategy for fostering a supportive environment where team members feel secure in taking risks, knowing that their leader will support them regardless of the outcome.

• Motivation during tough times is not attributed to a single factor.
• Belief in the company's direction and potential for more growth helps maintain persistence.
• Success is viewed as an "infinite game" with a focus on generational impact and enduring qualities.

"I don't think there was a singular motivation or motivating factor that got the team through it."

This quote indicates that multiple factors contribute to a team's ability to persist through challenges, rather than relying on a single source of motivation.

• Business is challenging due to its infinite nature, which is contrary to human desire for finite experiences.
• Celebrating milestones is important, but it's also crucial to recognize that there's always more to achieve.

"And it's why it is business is so tough because it's very against human nature to think that long term and to have that infinite horizon in your mind."

The quote reflects on the difficulty of reconciling the ongoing nature of business success with the human tendency to seek closure and finite achievements.

• Understanding and defining the problem is critical when facing complex issues.
• Reducing the scope helps manage high-variance problems by breaking them down into smaller, more manageable parts.
• The process of decision making is dynamic and requires continuous learning and updating.

"So what I mean by reducing the scope, it's almost formulating or manufacturing a set of milestones of, you know, where true north should look like."

This quote explains the strategy of simplifying complex problems by creating milestones, which serve as guideposts toward the ultimate goal, making the problem more approachable.

• The importance of a role and the individual's potential are key considerations in talent decisions.
• It may take time to discover an individual's superpowers, especially for those with more potential than experience.
• The duration given to prove themselves may vary depending on the individual and the role's importance.

"One of the beliefs we have at Doordash is to try to manage people to their superpowers."

The quote emphasizes the importance of recognizing and leveraging individual strengths within a company, suggesting a tailored approach to management and role assignment.

• Tony Shu believes his superpowers lie in recruiting and identifying talent before they are widely recognized.
• He also has a natural inclination towards problem-solving, whether technical or business-related.

"I think one of them is actually in recruiting, especially identifying, I think people before they're identified by everyone else as being world class in some domain."

Tony Shu identifies his unique ability to recognize potential talent early on as one of his key strengths, which has been beneficial in building a successful team.

• Emphasizes the importance of analyzing successful outcomes, not just failures.
• Reflects on the value of investing in markets and people that are often overlooked by others.

"I wish we did more post mortems on the success cases. I think we do lots of post mortems on the not so successful outcomes."

This quote highlights the speaker's desire to focus on learning from successes as much as from failures, suggesting that there is much to be gained from understanding what went right in successful ventures.

• Early DoorDash team prioritized talent over experience due to the novelty of their business model.
• Sought generalists capable of handling multiple aspects of the business, as opposed to specialists in fields like machine learning or AI.

"And early on, when I think about the team at Doordash, it was mostly people with more talent than experience."

This quote explains the initial hiring philosophy of DoorDash, which favored innate talent and potential over proven experience, given the innovative nature of the company's business model.

• Identified six key attributes that defined the most successful people at DoorDash.
• These attributes became a replicable playbook for hiring and fostering talent within the company.

"It took us a while. It probably took a year, year and a half before I started observing the most successful people at DoorDash and writing down what I call the six attributes of excellence."

The speaker reflects on the time and observation required to distill the qualities that made employees successful at DoorDash, which then informed their hiring strategy.

• Emphasizes the importance of aligning recruitment with the company's authentic culture.
• Discusses the necessity of testing and documenting which recruitment methods are most effective.
• Highlights how the initial team can influence and recruit subsequent hires, thus perpetuating the company culture.

"I think the learning algorithm here is you have to figure out what culture is going to be authentic to your organization."

This quote stresses the need for a company to establish and understand its own unique culture in order to recruit individuals who will thrive within that environment.

• Discusses the challenge of hiring external executives without demotivating internal candidates.
• The key is to hire someone so excellent that their value is obvious to internal team members.

"I think the only success criteria here I've seen is you have to hire someone excellent where it's so obvious for the person on the inside that this person on the outside can really help their careers and really grow them."

The quote addresses the delicate balance of bringing in external expertise while maintaining internal morale, emphasizing the need for the external hire to be a clear asset to the team.

• Considers the process of delegating responsibilities to new executives.
• Suggests starting with a small scope and quickly expanding as the executive proves successful.
• The goal is to optimize for the executive's quick success and trust-building within the team.

"But I think when the person is in the door, in order to set them up for success, you probably want to start small, because the information asymmetry of how your organization works versus how they may think your organization works is very, very large."

The quote explains the strategy for integrating new executives into the company by starting with a limited scope of responsibilities and gradually increasing it based on performance and adaptation.

• Culture should evolve and improve just like a company's product.
• Discusses the importance of adding new values to the culture, such as diversity and inclusion, and creating mechanisms to support them.

"Why is that not true for your culture? Maybe it changes more slowly because you're talking about people ultimately, when you talk about culture as opposed to software or other types of products, but it ideally is always improving."

This quote draws a parallel between improving a company's product and its culture, suggesting that although culture may evolve more slowly, it should nonetheless be subject to continuous improvement.

• Stresses the importance of measuring cultural values such as diversity and inclusion.
• Suggests starting with simple metrics like team representation and decision-maker representation.

"Yeah, I mean, the first thing is you have to actually be able to measure these things."

The speaker underscores the necessity of having quantifiable metrics to assess and improve upon cultural values within the company.

• Importance of diversity in recruitment and career development.
• Strategies to ensure diverse voices are heard and included, especially in hybrid work environments.
• The need for intentional practices to counteract natural biases in hiring and promotions.

"Who are the people that you're recruiting? Why are the funnels the way they are? Because we're always going to hire those that look like us or sound like us or more in our circles, and et cetera, et cetera."

• This quote emphasizes the inherent biases in recruitment processes, where people tend to hire candidates who are similar to themselves.

"How do you make sure that the person who has maybe the most disadvantaged voice, because they're not in the room actually gets to speak first?"

• This quote highlights the challenge of ensuring that remote or less prominent team members are given a chance to contribute, particularly in hybrid work settings.

• The unique energy and dynamics of in-person office environments.
• How physical office spaces can influence teamwork and company culture.
• The desire of employees to return to the office post-pandemic, as indicated by internal surveys.

"DoorDash always had very electric kinds of energy levels in all of our offices. And this isn't just the San Francisco office, but across all of our offices globally."

• Tony Shu describes the vibrant atmosphere DoorDash offices have, suggesting that such environments contribute to the company's culture and employee satisfaction.

• The practice of working on Sundays for planning and reflection.
• Balancing professional demands with family time.
• Using Sundays to align weekly activities with priorities and for valuable thinking time.

"It started because we just didn't have enough drivers, and so it was really part of just making sure that we had enough drivers on the road and doing deliveries."

• Tony Shu explains the practical origins of his Sunday work routine, which began as a necessity for operational efficiency.

"The other thing I found useful for Sundays is, candidly, just some thinking time and how important and sometimes increasingly rare that can be."

• This quote underscores the importance Tony Shu places on having dedicated time for strategic thinking and planning, separate from the daily operational tasks.

• Doordash's aspiration to build the largest local commerce app and platform.
• The company's mission to empower local businesses to thrive in the digital economy.
• The long-term goals of Doordash and the work ahead to achieve them.

"We are trying to build the biggest local commerce app, and we're also trying to build the biggest local commerce platform in which we're giving tools to merchants so that they can create their own digital businesses and really compete in today's digital economy."

• Tony Shu outlines the strategic objectives of Doordash, focusing on growth and support for local merchants.

• The value of resilience, curiosity, and kindness as desirable traits.
• Admiration for leaders who have achieved significant firsts and overcome substantial challenges.
• Barack Obama cited as an example of such a leader.

"Resilience, curiosity and kindness."

• Tony Shu lists the three traits he most values and would want his children to adopt, reflecting his personal and leadership philosophy.

"One of those leaders that comes immediately to mind was Barack Obama."

• Tony Shu expresses respect for Barack Obama's historic achievements and the obstacles he overcame, indicating the type of leadership qualities he admires.

• The mental consumption and all-consuming nature of building a startup.
• The trade-offs between personal time and the demands of the company.
• The impact on time spent with friends and family.

"Mental consumption. I guess building Doordash is an all consuming effort."

• Tony Shu speaks to the intense mental engagement required in leading Doordash, suggesting the significant personal investment involved.

"Especially for someone who is very curious, has done everything from cancer research to other things, and like a lot of different areas and different types of problems, that's one of the big sacrifices."

• This quote reveals the breadth of Tony Shu's interests and the sacrifices he's made in terms of time and focus to build Doordash.

• The challenge of managing bandwidth and allocating energy to various projects.
• The number of direct reports and the effectiveness of different organizational models.
• The importance of problem-solving within the chosen organizational structure.

"Bandwidth. Making sure that I'm giving the right amount of energy and attention to the right projects."

• Tony Shu discusses the difficulty of managing his attention across different initiatives within Doordash, highlighting the complexity of his role.

"You can make any model works as long as you're actually solving problems with whatever your organizational model is."

• This quote suggests that the success of an organizational model is less about the model itself and more about its efficacy in addressing issues within the company.

• The alignment and unity within the board when facing strategic decisions.
• The significance of board support in the company's persistence and strategic direction.
• The role of board meetings in shaping the company's future.

"And I think that there was one of these opportunities that came up in which we're discussing as a board, and I think it took 30 seconds for the board to look at one another and said, why would we ever give up on DoorDash?"

• Tony Shu recalls a pivotal moment where the board's unanimous decision reinforced their commitment to DoorDash, demonstrating the board's cohesiveness and resolve.

• The long-term aspirations for DoorDash and its mission.
• Tony Shu's personal decision-making framework based on fun and minimizing regret.
• The focus on evolving as a leader and enhancing the company culture.

"Where am I going to have the most fun and the least regret?"

• Tony Shu shares his simple yet profound personal decision-making criterion, which guides his life choices and suggests a balance between enjoyment and foresight.

"It's going to be hopefully evolving as a leader. It's hopefully, I'm trying to add to our team's personality, so improving our culture, making sure that our best people get to do the best work of their lives at the company."

• This quote outlines Tony Shu's goals for personal growth and his commitment to fostering a positive culture at DoorDash where employees can excel.