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Taking big risks

There comes a time in every company where the leader or founders have to decide whether they are going to take a big risk or play it safe. 

I met with a founder last week that was telling me about his frustration with his company. Things are going very well considering but he can’t get the team to take risks. 

The most striking thing about Facebook is how often they are willing to take big chances that could mess things up.

The classic example was Beacon. It was a PR disaster but it was a bold effort in product and vision and they had to regroup and come up with a better idea.

But they push things forward. Even before Beacon, the introduction of the Facebook news feed was controversial.

As long as Mark Zuckerberg is running the company we are going to see him shake things up with that service. For better and for worse. Some will love it – some will hate it. But you have to admire the desire to push.

David Karp and the Tumblr team take risks as well. Over the years I can think of a number of features that were launched to the entire user base and either refined or simply removed. 

An example of that was Tumblarity. Some folks loved it (like me) – others didn’t. It’s gone.

A few weeks back Tumblr released Highlighted Posts. Fred wrote about it last week. I am a big fan of this feature and I’m looking forward to see how it evolves. I know a lot of people love it but there are some that aren’t sure. One thing is clear, they continue to try new stuff over at Tumblr and it is very exciting to me. 

Another area where I see companies taking a big bet/risk is in the area of acquisitions. We have had a few startups in our portfolio seek to purchase a smaller company to accelerate important areas. That’s always a risky move but it can be extremely rewarding. Twitter’s acquisition of Summize (in ‘08) had a lot of risk but paid off extremely well. 

None of this is easy. It’s scary. Some of your investors will think you are nuts. Some of your employees will grumble. Your users may yell and scream. It requires vision, the will to inspire and a team to execute. Oh, and it doesn’t always work.

But taking risk is a big part of what makes a good company achieve greatness.