Nov 20, 2017 · 24m · 20vc
20VC: Zynga's Mark Pincus on When To Ride Your Winners and Cut Your Losers, Why People With "Broken Resumes" Make The Best Hires & The 2 Biggest Lies Told In Silicon Valley By Founders and VCs
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In this episode of The 20 Minute VC, host Harry Stebbings interviews legendary entrepreneur and investor Mark Pincus about the evolution of social gaming, strategic fundraising, hiring talent with 'broken resumes,' and decision-making frameworks for founders.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Harry holds 32.4% of the talking time here. How this is scored →
Harry as informed peer 2.3 Guest teaching 5.8 Guest disagreement 1.7 Harry pushing back 1.8
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 6:13 Mark reframes the consensus VC view on consumer distribution
Mark directly challenges the common premise presented by Harry that consumer tech is in a distribution fallow period, citing Evan Spiegel and arguing distribution is bigger than ever.
Hardest push from Harry ▶ 11:18 Harry confronts Mark with a founder counter-quoteHarry actively challenges Mark's emphasis on diversity of thought by introducing a direct counter-argument from a recent founder who insists on full team alignment.
Biggest teaching moment ▶ 15:05 Mark explains separating winning instincts from losing ideasMark delivers a deep lesson on founder psychology, explaining how B-plus ideas are the most dangerous trap because they give enough positive feedback to distract from a flawed core execution.
Harry holds his own ▶ 7:25 Harry drops insider intel on Mark's real estate strategy from Bing GordonHarry demonstrates strong background preparation by raising Bing Gordon's observation about Mark's willingness to sell real estate at market rate and prioritize expected value over loss avoidance.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| The Evolution of the People Web and Founding Zynga | 1 | 6 | 1 | 0 | Harry asks a broad historical question about social networking and founding Zynga in 2007. Mark takes full control of the narrative, giving an expert breakdown of the evolution of the people web from Napster and Friendster to Facebook opening its platform. | |
| Analyzing Consumer Tech Distribution and Organic Virality | 4 | 6 | 3 | 2 | Harry demonstrates research by citing common VC opinions on consumer distribution fallow periods and quotes background info from Bing Gordon regarding Mark's real estate philosophy. Mark gently reframes Harry's premise about distribution availability using Snapchat as a counterexample. | |
| Hiring Philosophy and the Advantage of 'Broken Resumes' | 1 | 6 | 1 | 0 | Harry prompts Mark on team building and hiring rules of thumb. Mark delivers a monologue on his preference for hiring people with broken resumes who have touched greatness but failed, contrasting them with overly comfortable recruits. | |
| Navigating Founder Alignment vs. Cognitive Diversity | 3 | 6 | 2 | 4 | Harry pushes back on Mark's stance by bringing up a counter-quote from a founder advocating for single-minded team alignment. Mark breaks down the quote, agreeing with the need for investor alignment while rejecting founder self-cloning. | |
| The Two Biggest Lies in Silicon Valley Fundraising | 3 | 7 | 2 | 3 | Harry presses Mark on how to evaluate true investor alignment and how to balance vision versus stubbornness when product-market fit lags. Mark educates Harry on the two biggest lies in Silicon Valley fundraising and outlines his framework for separating winning instincts from losing ideas. | |
| 60-Second Quickfire Round with Mark Pincus | 2 | 4 | 1 | 2 | Harry runs through a 60-second quickfire round, gently steering Mark back on track when he gives a general answer on career highlights by pressing for a specific moment like an IPO or user milestone. |
Statements from this episode (16)
Mark Pincus and Reid Hoffman bought the Six Degrees patent in 2003
“Recognizing the importance of social networking, in 2003, Mark teamed up with his friend, Reid Hoffman, the founder of LinkedIn, to purchase the fundamental six degrees patent, which broadly covers social networks, in order to keep it out of the hands of paten…”
Mark Pincus was an early investor in Napster
“In 2002 and 2003, a few of us started getting together and really thinking about the potential for a people web, a web that was about people connections and not page connections and something that in really building off of Napster, which I was a first investor…”
Mark Pincus and Reid Hoffman provided Friendster's initial funding
“Reid Hoffman and I got excited about that. We both kind of at the same time discovered Friendster and put up the original money for Friendster, and both started our own networks, LinkedIn and Tribe.”
Mobile distribution is bigger than ever, but lacks easy viral paths
“The distribution is there bigger than ever, but there are not easy proven paths that people can follow”
Greater success causes leaders and teams to become risk-averse
“The more successful you get, the more risk averse everyone gets”
Zynga purchased its corporate headquarters despite non-obvious deal economics
“The company bought our headquarters, and Bing has been a big proponent of that, and every time that we were making the purchase, the economics were not obvious.”
Mark Pincus prefers hiring humble, hungry candidates with 'broken resumes'
“I like to hire people who have what I call broken resumes. So someone who has seen greatness, touched greatness, come close to greatness, but then fallen because things just didn't work out. I find that those people are more humble and curious and more hungry.”
Strict leadership profiles restrict company diversity and DNA
“As soon as you have a spec for who's the kind of leader person, you're kind of doomed because you're going to kind of be narrowing your DNA and not expanding your DNA.”
Early Zynga succeeded by aligning investors around never selling
“One of the ingredients that I think was really key to making Zynga successful in the early days was alignment. And we had such powerful alignment between the investors, first the CEO and founder vision, and not just vision for the product or company, but the v…”
Founders lying about valuation and VCs about control are fundraising's biggest lies
“The two biggest lies around startups are founders saying, I don't care about the valuation and investors saying, you know, we don't care about control.”
Mark Pincus pitched Zynga by listing ten reasons not to invest
“I started off by saying to investors, let me tell you the top 10 reasons you're not going to want to back us. And if you still want to talk after that, we will, but then we won't waste time. And 95% of investors thanked me and said, I don't want to meet.”
Zynga withheld financial metrics from investors until late in fundraising
“I refused to share anything about our financials until kind of very, very late in the process, and I just said, you'll have surprise and delight at our financials, but I don't want you to invest because of them.”
Mark Pincus spent four years stubbornly pursuing a failed iteration of Tribe
“The most failing idea was try. I stubbornly stuck with one iteration on a social network for four years, and I got it so wrong. It's so painful to me to think that I tried one iteration of this, and it was clearly wrong, and I just stuck with it, and I could h…”
Startup success requires testing more ideas weekly than competitors
“In four years, I can't think of how many more I could have tried, and that lesson was burned into me, and I think so much of success today is starting with a winning instinct, but then testing more good ideas, In a week than the rest of the industry does.”
Mark Pincus missed investing in Square because he thought he was too busy
“I don't know that it was offered to me, but Square, when Jack Dorsey was walking out in the hallways at a conference with a dongle, and I thought I was too busy.”
Cryptocurrencies can enable a post-capital and post-corporation world
“Now I got involved with cryptocurrencies and Bitcoin early, and then I thought I was Too early, and maybe it wasn't going to happen, and now I'm completely drinking the Kool-Aid, and I'm completely enthralled by just the potential of cryptocurrencies to get us…”