...businesses should never engage in me-too behaviour. If a product or service doesn't complement the business, then it shouldn't be in the portfolio.
Innovation is not just about products
Obviously, products and services are important. They are what the customer buys and so generally need a USP.
However, focusing purely on creating a piece of tech with killer features or must-have design means nothing if the revenue and distribution models don't add up.
"In consumer internet companies, frequently engineers think that product innovation is the only key innovation and everything else can be thought about later. In almost no business is this true," Hoffman said.
When companies take their eye off the essentials, such as ways of monetising their products, Hoffman said, organisations can miss golden business opportunities.
"Look at search as an example. In 2000, Yahoo said, 'We're doing really well. Fewer of our page views are coming from search', because search was this loss-leader that got people to come to your site," he said.
It took Google to come up with AdWords, the practice of selling adverts linked to search terms, to turn search into a multibillion-dollar earner, or as Hoffman puts it, "One of the best business models in the world".
Look beyond the CV when hiring
One of the mistakes Hoffman said he made when setting up his first company, SocialNet, was to get too hung up on hiring the best person in each field - marketing, software engineering and the like. What he should have been asking is whether candidates were cut out for life in a startup.
What he should have been looking for, he said, was someone with a particular aptitude for learning on the job and for knuckling down under extreme pressure.
There's a lesson here for HR departments about the need to break free of the established procedures that can constrain their approach to hiring. Businesses could benefit from going slightly off-piste in interviews and asking candidates questions that will test their mettle and reveal more about them as individuals.
In the early days of Google, the company's co-founder, Sergey Brin, would reportedly put new recruits on the spot by asking them to brief him about a topic he knew nothing about, and then ask them a barrage of questions on the topic.
Hoffman's comments on the limitations of HR practices echo those of talent-spotter George Anders, who recently told silicon.com that companies need to broaden their criteria for new candidates beyond a narrow focus on qualifications.
Nick Heath is chief reporter for TechRepublic. He writes about the technology that IT decision makers need to know about, and the latest happenings in the European tech scene.