Fear Gives Bad Advice: An Executive Coach's Playbook for Firing, Layoffs and Focus

Mochary came to coaching after a first company, a stint helping ex-convicts become truck drivers, and a wish to rejoin the tech world without building another company. He started with Stanford student founders and was passed up the chain to people such as Naval Ravikant, Sam Altman and Brian Armstrong. Asked where even the most successful founders struggle, he says it is fear, which grips the mind and stops people doing what is difficult but necessary.

His technique is to propose a bet. If a CEO predicts that doing something will lead to outcome A, Mochary predicts the opposite, they pick a lower-stakes example, and the winner decides what to do. He says he has made this bet hundreds of times and never lost, not because he is a genius but because a person gripped by fear makes exaggerated predictions, while he is not in that state. After one win, he says, a reminder that he perceives the CEO to be in fear is usually enough.

His most extreme example is a CEO who knows about a problem and hasn't told the board, just before a fundraise. The knee-jerk answer is to hide it, but he predicts that transparency will build trust, not destroy it. He says that every time a CEO has done this, board members have thanked them for their honesty. He adds a caveat: check with someone who is not afraid, and do not treat physical danger as just fear talking.

Mochary describes how his wife learned to tell him he was in anger without making it worse. Saying "You're in anger" made him feel accused, and asking "Are you in anger?" sounded passive-aggressive. What finally worked was "I perceive you to be in anger," an I statement with no judgment, which let him stop and wait until he had shifted out of the anger.

He treats anger and fear differently. Anger destroys relationships, often with the people closest to you, so you need to stop. He then shares something he had learned only recently: anger is not a base emotion but a cover for pain, which the brain externalizes and pushes onto others.

The real answer, he says, is to allow yourself to feel the pain, even though it hurts. He admits that he is still practicing this and only sometimes avoids going to anger. Lenny remarks that the advice feels personal, and Mochary says that is the point: if he can work something out for himself, he can share it with others.

Mochary says his first company, Totality, was badly run, so he had no best practices to share. Ten years later he read books such as Andy Grove's High Output Management and Ben Horowitz's The Hard Thing About Hard Things, boiled them down to two-page summaries for the founders he coached, and watched them work. Those summaries became his curriculum and eventually a book, which a friend, Alex MacCaw, edited and published.

Because CEOs refused to try his most radical ideas without precedent, he hired developers to build software for his methods and now has a team to test ideas on. About half of the ideas work and half are duds. One idea came from a CEO who had never regretted letting someone go, which Mochary took to mean he did not know where the bar was. Mochary then let go of an outperformer whose work his number two could absorb.

After about two to three months, he decided it was the right call, because the organization worked better with fewer people. Each added person adds overhead that grows faster than headcount, since everyone needs context and needs to feel heard. He points to WhatsApp, Instagram, Linear and Notion as the real success stories of keeping teams small, and Lenny compares it to Elon Musk's view that "the best part is no part."

Mochary says that managers avoid letting people go because they believe they are hurting them. He relays a framework from Wei Deng, CEO of Clipboard Health, who separates the decision from the implementation. The decision is made for the stakeholder, usually the customer, who would want only great employees. The implementation asks who gets hurt and what each of them really wants.

The departing employee wants a job where they are needed, and Mochary says keeping them in the wrong role holds them back. The manager wants to avoid a hard conversation, and cognitive behavioral therapy suggests the way past that is to have it. The team is sad, and what they want is to release their emotions, so you listen to them.

His central practice is to become the person's agent, in the way of a Hollywood talent agent, by actively contacting people he knows to find a role. He says this takes only an hour or two and is much better than offering a reference, which he calls passive. Even if someone rejects the help, they still recognize it was offered, and Mochary says he stays friends with everyone he has let go.

Mochary says that remote firing is no different from in-person. His first step in any hard conversation is to say that it will be difficult and give the person a few seconds to prepare, because the amygdala is often triggered by surprise. Then he delivers the news and the reason. Then he asks whether the person feels anger, fear or sadness and invites them to share it, and he listens actively.

On making people feel heard, he describes three levels. First, ask everyone to write down their solution in a shared doc and thank each contributor by name when reading it. Second, repeat back what you heard until the speaker says yes. Third, reflect the thoughts you imagine are behind their softened words, such as "screw you, Matt," and ask whether that is close.

He says that people almost always say the real thought is stronger than their words, and that feeling heard follows. Hearing is not the end, though. You then have to say whether you accept the feedback and what you will do about it, or explain why you cannot, by sharing what is going on in your world. Asked how to learn all this, he says the curriculum has step-by-step scripts and that most people do not need a coach.

Mochary says his approach has changed since his early coaching of Naval at AngelList. Back then it was all tactical management: goals at company, department and individual levels, with agreements and actions tracked in Asana. He still does that, but has since added the piece about acting in the moment despite fear.

New clients first read three documents: on time, top goal, and fear and anger give bad advice. On time means starting meetings promptly. Top goal comes from Essentialism author Greg McKeown: set a daily block of 30 minutes to two hours on your own priority, or you will spend the day answering other people's requests. The third document shows whether a client's philosophy fits his, and he says that if it does not resonate they should not work together.

Lenny admits he has trouble keeping his top goal time, and Mochary says that is the hardest part. His solution is to have an accountability partner sit with him during that block, like a gym trainer, which he finds especially useful because he is people-oriented and finds solo tasks painful. The partner can be remote or in person and can do their own work, and Mochary says his kids sometimes do it.

Mochary says that large layoffs can still have each person's manager act as their agent, since managers usually have around a dozen reports and rarely cut more than half of them. He says his companies cut costs in March 2020 and, within 60 days of each layoff, CEOs reported the company was operating better in absolute terms. Some of that came with cuts as high as 40% at a hotel company. He says a reset in growth-stock valuations that spring has brought another wave, with some cuts reaching 50%.

The best marker of a botched versus successful layoff, he says, is whether people hear the news one-on-one from their manager. News by email or group chat feels dehumanizing, which is when people go to Twitter and newspapers. Leaders should give managers dollar targets rather than headcounts, since headcount targets push cuts toward cheaper junior people, and let each manager choose, which can be done in about 48 hours.

On the day, managers hold back-to-back 15-minute conversations in the morning and schedule a longer follow-up to act as agent. In the afternoon, an all-hands for the staying team answers fear-driven questions and promises to cut deep once, because repeated cuts create trauma. Finally, each remaining employee gets a one-hour one-on-one with their manager just to share feelings and feel heard. Mochary says this cuts emotion by about 25% and brings recovery in two weeks instead of 60 days, and he adds that even a badly handled layoff leaves a company performing better within two months.

Mochary says he did not at first know how to help large companies innovate, but noticed YC startups moving far faster. His answer is to create your own startup inside the company: a very small team led by a founder-mentality person, which he says you can find among failed YC alumni, with no need for buy-in because everyone shares the same information.

The reason big companies struggle, he explains, is that a scaled product must stay up and secure at all times, so every code change faces an intense review. To decouple, the team needs to avoid the core code and the product approval process, which means reporting outside engineering, product and design, usually to the CEO. He goes further and suggests a separate brand and even a separate C corporation.

When a CEO asked whether anyone did this, Mochary realized nobody he knew did, until Wei Deng told him she had created five C corporations in two months. She told him the team is not afraid to try things because it cannot harm the core brand. She also runs two independent teams on each new product, one building custom code and one using manual or off-the-shelf solutions, to see which moves faster. Asked about equity, Mochary says it does not matter much; ownership over decisions and building things that get used motivates people more, and he cites Amazon.

Mochary says that the things we love often make time disappear, so we undervalue them. He borrows from Diana Chapman of the Conscious Leadership Group a model of four zones: incompetence, competence, excellence and genius. The zone of excellence, where you are uniquely good but do not love it, is the danger zone, because you are paid well for it but it drains you.

The way into the zone of genius is not to work out what it is and do more, but to work out what it is not and remove that. For the audit, you take two representative weeks of your calendar, fill in the gaps between meetings, and at the end of each hour mark it green if you gained energy and red if it was neutral or negative. Then you look for themes in the reds, such as meetings with no preparation or interviews with no hiring outcome.

For each red item, ask whether it needs doing at all, and if so, whether someone else can do it. If only you can, ask what would make it exquisite; his example is an exec meeting where everyone pre-writes updates so a three-hour meeting becomes 45 minutes. He says nine out of ten times colleagues agree, and that repeating the audit until the calendar is about 80% green changed his life. Lenny says a simpler version helped him find his way to writing, and Mochary shares that Brex's founders used it to split internal and external meetings.