This Billionaire Investor Says Most Founders Focus on the Wrong Question — Which Can Be Deadly Thomas Tull wants founders to move with "velocity," and says too many of them let one preoccupation slow them down.

The world moves fast. Thomas Tull wants founders to move faster.

That's why, when he invests in a startup, he gives them this advice: "Prepare for velocity." In other words, make sure you're ready to grow quickly and pivot at a moment's notice.

Tull has taken that advice himself. His career has run on fast growth — from when he ran a chain of laundromats after college, to later founding the film studio Legendary Entertainment (which made massive hits including The Dark Knight trilogy and The Hangover series). That work, along with finding success as a tech and VC investor, made him a billionaire. After leaving Legendary in 2017, he continued his investing career — starting Tulco, and supporting Pinterest, FIGS, and Oculus Rift — as well as the United States Innovative Technology Fund, which invests in companies like Sandbox AQ. He's also part-owner of the Pittsburgh Steelers and the New York Yankees.

Related: Navigating the Fast Track — How to Ensure Your Business Growth Doesn't Outpace Your Vision

The way Tull sees it, running a business has always been hard — but the landscape was once more predictable. Here, Tull talks about how to navigate today's fast-moving environments, and why it all starts with a leader's attitude.

I love that advice you give founders: "Prepare for velocity." Can you unpack it?

Things happen so quickly now — due to the confluence of global politics, technology moving at a geometric rate, and all our interconnectivity. Your company can get big very quickly, and it can fail very quickly. You're going to have to make a lot of choices with imperfect information, and you must be prepared for the velocity of today's changes, and the implications of your decision-making.

How does a founder put that into practice?

Start with your elemental value system — that is, what you fundamentally believe in and want to act upon. Then you must have pliability, to be able to change and bend where applicable.

So how can you be prepared? Know your organization, know yourself, and understand what threats could appear. I don't think there's a manual for this; it's not like, "Just write a mission statement about how to prepare for a flood." It's more of a mindset — to not get complacent, to be sufficiently paranoid, and to be incredibly intellectually honest.

Can founders build a team that's optimized for velocity?

That's part of the resiliency question. Is your workforce just showing up, punching the clock, and saying, "I'm here until the next thing"? Or do you have a real shared mission? That starts with hyperhonesty and communication — so it's not just, "because I said so." Everybody understands what's at stake, and why you're doing what you're doing.

In organizations I've led, this would almost become a joke around the office. It was: "The only thing that's going to get you fired is not speaking up, not speaking your mind." I mean, look, you're paid for your talent, your aptitude, your opinions — let's hope they're well-informed!

Related: Knowing When — and How — to Pivot Is Key to Your Business' Survival. Here's What You Need to Do.

As you say that, I'm thinking about the leaders that I did or did not feel comfortable sharing my perspective with. It often came down to: How defensive does that person get?

Everybody says, "I have an open-door policy" or whatever, but what happens when someone walks through that door? What happens in a group meeting when someone says, "I see this completely differently"? How are they treated? Is there any follow-up action?

There's a difference between being defensive and contextualizing a decision. A leader could say, "Look, that's a really good point, but let me tell you what was on the other side of that." To me, that's very different than immediately shutting a person down. Most of that defensive stuff comes from some kernel in your mind that you know you're wrong.

A consultant friend once told me: We spend a lot of time trying to anticipate failure, but we rarely ask ourselves, What happens if this succeeds? But we should — because sometimes we're not building things that are ready to scale, and we could avoid a lot of problems today by imagining how they'd be amplified tomorrow. What do you think?

I'm reminded of an old friend of mine in Texas, [Clear Channel Communications cofounder] Red McCombs. His mantra was, "Expect to win." Because if you don't expect to win, then why are you doing what you're doing? Why are you spending your limited time on it?

When companies don't think about the implications of growing quickly, they may not reach their potential. It's why, when I invest in younger companies, I always tell them: "Overinvest in HR." Because I often find that companies are like, "Oh my gosh, we grew so quickly and we don't have those policies and procedures. People kind of feel like they're floating because we never expected..."

When people think about fast-moving business today, they often think of AI. What's your advice to someone who's not sure if they should invest their time in it?

It depends on the industry. It depends on your individual company. One of the thought experiments I think you need to run is, How much would I care if my competitor implemented this, and what impact would it have on my business? If it would severely hinder you or put you out of business, then I would think very seriously about it.

I believe that, over the next decade, AI and adjacent technologies will be in every corner of our economy. If you're not sufficiently trained, digitally fluent, and able to take advantage of this, then I think it's going to be a real problem.

So let's say people ask themselves that question, and the answer is, Yes, I'd be screwed if my competitor used AI. What's next?

Start with the basics. What is it that you do in your business? What's worth knowing? What's actionable? What's repeatable? Where are the choke points in your business? What's painful about it, and what would change everything? Then work backward from there. If you have a hard time answering those questions, then either you're not a great candidate for AI or you don't have a great grasp on the implications and the possibilities of these technologies.

If somebody is worried that they're unprepared for velocity, where's a good place for them to start preparing?

Take inventory in an honest, self-reflective way. Say, "OK, what does my business look like? Do I have the right people to effectuate the changes that I need? Do I have the right culture? Do I know enough to make informed decisions about where we need to go?"

That may be incredibly uncomfortable, but it is vitally important — because if you're unwilling or unable to do that, then the world will inflict whatever the world will inflict upon you.

Related: 8 Mistakes First-Time Founders Make When Starting a Business