Leadership, according to Horowitz, is often about navigating uncertainty and making decisions with incomplete information. The role of a CEO is not just about setting a vision but also about managing crises, motivating employees, and keeping the company afloat during difficult times. CEOs must develop the ability to handle stress, face criticism, and push through setbacks without losing focus. He stresses that leadership is not about following a blueprint but about adapting to ever-changing challenges and making the best possible decisions under pressure. Ultimately, great leaders must be prepared to take responsibility for failures while ensuring their teams remain motivated and driven toward success.

2. The Struggle is Real

One core theme in Horowitz’s book is “The Struggle,” the tough, lonely moments leaders face when things go wrong. He reassures entrepreneurs that these struggles are normal and part of the journey. Drawing from his experiences at Loudcloud (later Opsware), Horowitz emphasizes that setbacks like layoffs, missed targets, and criticism are inevitable.

To navigate “The Struggle,” Horowitz advises leaders to stay mentally strong, seek guidance from mentors, and avoid emotional decisions driven by fear. Persistence and adaptability are key, as successful leaders push through setbacks. He also highlights the importance of managing stress, whether through exercise, support networks, or reflection. Enduring these hardships, he concludes, is what separates great leaders from the rest.

3. Making Tough Decisions

Horowitz highlights that being a leader requires making difficult decisions with limited information. Often, CEOs must choose between options that are all less than ideal, relying on judgment, experience, and a willingness to accept the consequences of their choices. He emphasizes that tough decisions define a leader and that avoiding them can be more harmful than making a wrong call.

Some key examples include:

Firing Friends: Leaders often have to fire employees who may be friends or early team members if they are not performing well. Horowitz advises making these decisions based on the needs of the company rather than personal relationships and ensuring the process is handled professionally and respectfully.

Laying Off Employees: Even when layoffs are necessary, they must be done with empathy and respect. He stresses the importance of clear communication, treating employees fairly, and ensuring they understand the reasons behind the decision.

Choosing Between Bad Options: Sometimes, every available option is undesirable, and a CEO must choose the least harmful path. Horowitz shares real-world examples where leaders had to make impossible choices, such as keeping a struggling company alive through drastic measures or shutting down operations to prevent deeper losses.

Knowing When to Pivot: Business leaders often face the dilemma of whether to stay the course or make a drastic change. Horowitz argues that understanding market conditions, customer needs, and internal capabilities is crucial in deciding whether a pivot is necessary.

Making Decisions Under Pressure: In high-stakes situations, leaders must think clearly and act decisively. Horowitz underscores the importance of not letting fear dictate decisions and instead focusing on data, expert advice, and intuition.

4. The Importance of Building a Strong Culture

Horowitz emphasizes that company culture is not about slogans but about actions. A company’s values should be demonstrated through decisions and behavior at all levels, from leadership to entry-level employees. He argues that culture is not something that can be dictated—it must be built intentionally and reinforced through everyday practices.

Some key aspects of building a strong culture include:

Leading by Example: The behavior of the CEO and leadership team sets the tone for the entire company. If leaders prioritize integrity, hard work, and transparency, employees are more likely to adopt those same values.

Rewarding Cultural Fit, Not Just Performance: Horowitz stresses that companies should recognize and reward employees who embody the company’s values, rather than just those who deliver financial results.

Creating a System for Reinforcing Culture: A strong culture does not happen by accident—it requires deliberate effort. This means integrating cultural values into hiring practices, performance reviews, and day-to-day decision-making.

Being Willing to Make Tough Cultural Decisions: If an employee, no matter how talented, is harming the culture, leaders must be willing to make difficult choices, including letting them go.

Horowitz provides examples of how companies with strong cultures have weathered crises better than those with weak or inconsistent cultures. He argues that when a company’s values are clear and upheld in decision-making, it creates alignment, fosters trust, and improves employee morale. Ultimately, culture is not what a company says—it is what it does every day.

5. Hiring and Managing People

Horowitz dedicates a large portion of the book to hiring and managing employees, particularly executives, as he believes that building a great team is one of the most critical responsibilities of a CEO. He emphasizes that hiring the right people, managing them effectively, and knowing when to make tough personnel decisions can determine the success or failure of a company. He provides practical advice on several key areas:

Hiring for Strength, Not Absence of Weakness

One of Horowitz’s central hiring philosophies is that companies should hire for strength rather than merely avoiding candidates with weaknesses. Many hiring managers make the mistake of looking for “safe” candidates who check every box but lack exceptional strengths. Instead, he argues that the right hire should bring something outstanding to the table—whether it’s technical expertise, leadership skills, or a unique perspective—even if they have some shortcomings.

Horowitz encourages leaders to identify the specific skills and qualities that will have the biggest impact on a role and prioritize them over minor weaknesses. For example, if a startup needs a VP of Sales to drive revenue growth, it is better to hire someone with a proven ability to close large deals—even if they lack experience in a particular industry—rather than someone who meets every traditional qualification but lacks strong sales instincts.

Training Employees for Success

A common mistake among managers is assuming that talented employees do not need training. Horowitz stresses that even the best hires require proper onboarding and continuous coaching to succeed. Managers should take an active role in developing their employees by setting clear expectations, providing constructive feedback, and ensuring they have the tools and support needed to thrive.

Horowitz outlines several strategies for effective training:

Clear Communication: Employees should understand their role, responsibilities, and performance expectations from the start.

Regular Feedback: Frequent and honest feedback helps employees improve rather than waiting until annual reviews.

Providing Growth Opportunities: Great managers help their employees advance by offering challenging projects and career development opportunities.

He argues that neglecting employee development leads to disengagement, poor performance, and increased turnover, which can be far more costly than investing time in proper training.

Promoting from Within vs. Hiring Externally

Horowitz discusses the difficult decision of whether to promote from within or hire externally. Both options have advantages and risks:

Promoting from Within: Internal promotions help maintain company culture, reward loyalty, and provide growth opportunities for employees. Since internal hires already understand the company’s mission and values, they often require less training and onboarding.

Hiring Externally: Sometimes, a company needs to bring in external talent to gain fresh perspectives or specialized skills. External hires can introduce new ideas and strategies that an internal candidate might lack. However, they also come with the risk of cultural misalignment and a longer adjustment period.

Horowitz advises that companies should prioritize competence over familiarity. If an internal candidate is truly ready for the role, they should be given the opportunity, but if an external hire can significantly elevate the company’s performance, leaders should not hesitate to bring in outside talent.

6. The Role of a CEO

The CEO plays a crucial role in setting the direction of the company, making high-stakes decisions, and guiding the overall vision and strategy. In addition to being the public face of the company, the CEO is responsible for ensuring the business operates efficiently, develops its culture, and reaches its objectives. A key part of a CEO’s job is managing and inspiring employees, fostering a collaborative environment, and aligning team efforts with the company’s goals.

Horowitz distinguishes between two types of CEOs, each suited to different stages of a company’s life cycle: wartime CEOs and peacetime CEOs.

Peacetime CEOs manage companies that are in stable conditions, with a clear and steady path to growth. These CEOs focus on optimizing existing processes, maintaining smooth operations, and ensuring that the company expands at a manageable pace. Their strategies are generally more predictable and conservative, focusing on long-term growth and profitability without dramatic risk-taking.

Wartime CEOs, on the other hand, lead companies that are facing existential threats, whether from competitors, economic downturns, or other crisis situations. These CEOs are required to take aggressive, often unconventional actions to ensure the company’s survival and success. Wartime CEOs tend to make bold decisions, pivot quickly in response to changing circumstances, and rally the team around a singular, urgent mission.

Ultimately, a CEO’s ability to switch between these two roles — peacetime and wartime — is critical in shaping the company’s trajectory and ensuring it remains adaptable to different challenges and opportunities.

7. Handling Crises and Failure

Horowitz offers valuable advice on handling crises and failure, which are inevitable in business. He stresses that a CEO’s response is crucial for the company’s survival and success.

Honesty is key during a crisis. Transparent communication with employees, stakeholders, and customers builds trust and helps maintain morale. CEOs must also make fast decisions, even with limited information, and adapt as new details emerge. Agility in decision-making is critical.

Adaptability is another important trait. CEOs should be flexible and willing to pivot when necessary while staying focused on core values and long-term goals.

Horowitz also acknowledges the mental toll of crises and advises CEOs to develop coping mechanisms, build a support network, and take time to recharge. Managing stress and maintaining clarity are essential for making sound decisions. Ultimately, handling crises effectively can strengthen a leader and their company.

8. Managing Growth and Scaling

Scaling a company is both exciting and challenging. As businesses grow, they face new complexities, including maintaining company culture, hiring the right talent, and managing increased operational complexity. Horowitz emphasizes that scaling isn’t just about expanding the product or increasing revenue, but also about navigating these internal challenges.

One of the biggest hurdles is maintaining culture. As the team expands, the values and mission that drove early success can begin to fade. CEOs must ensure that culture is nurtured by consistently communicating the company’s vision and aligning new hires with these values.

Hiring the right people is critical, especially as specialized skills and leadership become more necessary. CEOs must be strategic, ensuring hires fit both the company’s culture and its growing needs. As the team expands, delegation becomes essential. CEOs must trust their leadership team with greater responsibility and allow autonomy in executing roles.

Effective communication systems are also crucial. As the organization grows, CEOs must implement both formal and informal channels to ensure alignment, keep everyone informed, and encourage feedback. Regular updates and transparent decision-making help avoid misunderstandings.

Finally, building leadership within the company becomes increasingly important. As the company scales, the CEO cannot be involved in every decision. Horowitz advises CEOs to identify and mentor potential leaders, empowering them to take on more responsibility and ensuring the company is prepared for future challenges.

9. Selling a Company and Navigating Acquisitions

Selling a company is a major decision for any CEO, involving both strategic and emotional challenges. Horowitz shares his experience of selling Opsware to HP for $1.6 billion, detailing the emotional toll it took on him as a founder and leader. He emphasizes that CEOs need to be prepared for the emotional rollercoaster, including adjusting to no longer being the decision-maker.

The sale affects not just the CEO but also employees, investors, and customers. CEOs must manage these stakeholders carefully, ensuring transparent communication with employees and aligning the sale with long-term company values. For investors, balancing financial returns with the company’s future is crucial, while customers should be reassured that their needs will be met post-sale.

Horowitz also highlights practical strategies for navigating the acquisition process, including understanding the acquiring company’s motivations and managing post-acquisition integration. A successful sale is not just about the financial outcome but about preserving the company’s legacy and addressing the concerns of all stakeholders.

10. Final Advice for Entrepreneurs

Horowitz’s final advice to entrepreneurs emphasizes that leadership is tough, and the entrepreneurial journey is filled with unexpected challenges. He encourages leaders to embrace adversity, as hardships shape great leaders and contribute to success. Trusting instincts is crucial, especially when data and advice are overwhelming. CEOs must also make bold, calculated decisions and take risks, as innovation often comes from challenging the status quo.

He stresses the need to be prepared for the unexpected, as entrepreneurship is inherently unpredictable. Resilience and adaptability are key to overcoming unforeseen challenges. Building strong relationships within the company, with mentors, and with partners is essential for long-term success. Finally, Horowitz advises entrepreneurs to manage their emotional well-being, avoid burnout, and develop strategies to cope with stress, ensuring sustainable leadership.