I first heard this phrase from one of my favorite co-investors. We we chatting during a break in a board meeting in which the CEO was predicting a quick, favorable outcome on a very large enterprise deal. The investor’s summary — which turned out to be correct — was that the CEO had “happy ears”: a tendency to hear only the good news and tune out the bad.
Happy Ears can be an adaptive trait for CEOs, and entrepreneurs more generally. Creating a company from scratch is brutally hard and often discouraging. If you let the bad news get you down too much you’ll never make it through.
But too strong a case of Happy Ears in a founder can also drive companies — and all their employees and investors — off a cliff.
Andy Grove said it best: “only the paranoid survive“. The most effective founders maintain a controlled state of schizophrenia at all times: using their Happy Ears to keep themselves and their teams motivated with big dreams, while at the same time expecting all their best laid plans to go awry.
Shit happens. Deals don’t close. Promised term sheets don’t appear. Key hires back out at the last minute. Don’t let Happy Ears keep you from anticipating — and recovering from — the million inevitable setbacks you’ll encounter on your way to success.