Michael Dell Gets Honest About How He Built a Billion-Dollar Business: 'I Wasn't 50 Percent Smarter Than Everybody Else' Dell believes his willingness to try, fail and learn has helped set him apart in a risk-averse business world.

In 1984, Michael Dell told his parents he was going to drop out of college to sell computers. They were concerned, to say the least. The gamble worked out, of course — his namesake company became one of the largest players in the computing space, then went public and made him a billionaire. But when, in 2013, Dell announced that he was going to take his company private, industry insiders and the press were even more skeptical than his parents back in the '80s. That didn't bother him. "I think most people are careful and risk-averse," Dell says. "They don't achieve their full potential because they don't want to fail. And I think a big part of my success is that I wasn't, you know, 50 percent smarter than everybody else or something — I was just willing to take more risks and experiment and learn and ask questions."

In his new book, Play Nice But Win, Dell details his career origins and the long saga of taking his company private. Here, he talks about the hard lessons learned along the way, and why he still appreciates his failures from long ago.

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You seem to be very aware of your critics. Throughout the book, you quote what naysayers said about you in places like the Times and the Journal. How do you make bold decisions while also listening to the people who say you're wrong?

Going private was an epic media extravaganza. I developed a bit of a Teflon skin, because, you know, people are always criticizing you. When you're leading a company, if things are going really well, greatness is ascribed to you way beyond what you deserve — but the reverse is also true. You're the front person. So you just learn to not take things personally and to stay focused on the long-term plot.

Do you have advice for people who struggle with that? Teflon skin does not grow naturally.

The first question to ask is "Is there anything that can be learned constructively from this, or is it just people spewing off nonsense?" You know those parks in London where they have little boxes and the crazy people stand up and say all this nonsense? Well, before the digital world, you'd walk by and say, "This guy's bananas; I'm not going to listen to him." So why would you listen to somebody online? Don't waste your time on that. Maybe there are things to learn from feedback, but most of it doesn't really matter.

As you say, criticism sometimes can be correct. And leaders must constantly evolve as their companies grow. Did you do a lot of work on yourself as Dell grew?

Oh, no question. As a business goes from a million dollars to 10 million to 100 million to a billion to a hundred billion, everything has to evolve, including how you lead. If you're not able to do that, you're going to have challenges.

Now, I do think there are principles and values and beliefs that should be consistent. The role of the leader is to understand and comprehend all that and figure out what is needed, then to inspire and motivate and drive the business forward.

Of all the mistakes you made as a young leader, what was the hardest to learn from?

It's people, and the importance of who you surround yourself with, and how you develop talent in the organization. When you're growing like a total maniac, it's super hard to find people who can grow as fast as the company is growing and are willing to be crazy enough to join you.

When I started, it wasn't obvious that this was going to be as successful as it turned out to be. The risk was super high, so we attracted mercenaries. As we became more successful, we attracted more talent — but boy, the focus on developing talent and really spending time nurturing and ensuring that we have the right talent is something I wish we'd focused more on in the first decade of the company.

Right — because as you'd written in the book, the people to get you from A to B are not necessarily the people to get you to C and D.

I pretty much went through the whole alphabet as the business kept evolving and changing. The way to think about change is to say, "We're going to walk out of the building and walk in like we're the new leaders of the company. What needs to be done right now? We don't care about anything we did in the past. And we're willing to question anything. Nothing is sacred."

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How often should a leader of a growing company step back and assess like that? Were there milestones when you would do it?

Hopefully you're not doing it every day, because you're talking about some pretty monumental decisions. But if you're growing rapidly, and if the business is changing or struggling, I think you're doing that relatively frequently. We probably had to do that 10, 15 times over 37 years.

Does it get easier?

It does, actually, after you've done it a few times.

Perhaps that's because, as you've said of yourself, you're great at compartmentalizing.

I don't know how you could do a job like this without compartmentalization skills. There are just so many things going on, and of course, you've also got the rest of your life. You want to be a husband, a father, a brother, a friend, etc.

I've met many entrepreneurs who struggle with that, and their relationships suffer as a result. What's your advice on separating work from life?

The first thing is time. You must recognize that there's a diminishing return to the number of hours against any task. Trying to work 18 hours a day, 20 hours a day? Forget about it. You're not going to be physically well. Your family is going to be a wreck.

I slept at the office when I started, but I was 19 years old. Nobody cared! After a while, you realize you're not happy unless you have balance. You've got to figure out how you manage your time, your energy, and your resources so you're happy and can sustain it over a long period of time.

Anybody can sprint. I've been in situations where you just have to go all out for a short period of time. I get it. But you can't do that forever. If you want to keep running marathons, you'd better have a sustainable pace.

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In your office, you keep mementos from failed Dell projects. Why?

There are always valuable lessons learned. We had a time back in the late '80s where we took on a massive engineering project. It turned out to be too ambitious, and it failed. But we learned a lot, and we had a lot of great capabilities we built as a result. The lessons we learned in terms of how far to push the envelope, and what levers to push and pull, were tremendous. I try to share those lessons throughout the company so we don't have to relearn them over and over.

That's a nice way of thinking about it. If you survived a failure, then something valuable must have come out of it.

Absolutely. That painful lesson helped us develop a tremendous capability that propelled us way further than we'd ever imagined.