Martin: Today, we have an evangelist, marketer, and a trailblazing entrepreneur, a product of Silicon Valley. Guy Kawasaki. Welcome to the show.
[(6:12)] Guy Kawasaki: Thank you. Very well done.
[(6:14)] Jax: Yeah, keep that good, like eight and a half out of ten for an intro.
[(6:17)] Martin: Well, I appreciate that. Thanks very much. Alright, let us start with a somewhat provocative question, and let us just talk about the present day. What do you think? Is it a good or bad time to start a company, Guy?
[(6:28)] Guy: I cannot make the case it is a great time, but my observation is that bad times create great companies. And also the flip side, great times create bad companies. And so what I think happens is, when it is a bad time, money is tight, it is hard to do things. And it improves the breed.
Guy: A true entrepreneur is going to start a company when he or she is going to start a company. And if you are talking to somebody, you are dealing with somebody who says, “Yeah I am going to start a company as soon as I have patent pending world-class, enterprise scalable, revolutionary product, and it is a growing market, and there is no competition, and capital is easy”, that person is not an entrepreneur and will never start.
[(7:14)] Martin: Yeah, that is fair. And so we are gonna get in a lot of detail around passion, opportunity, timing, roadmap, all that good stuff. But what are the trends you are seeing right now, to separate the pandemic, but what do you think is really hot right now for startups? What gets you excited?
[(7:31)] Guy: By the time somebody like me, who is sixty-six years old, and sort of not the leading edge of technology, by the time I think something is hot, it is probably too late to get into it. So truly, the question is better ask of two guys in a garage, two gals in a garage, a guy and a gal in a garage, or in a dorm room, or in an apartment. This is all pre-pandemic, of course, about what they are trying to do, because that is the leading edge of technology.
It seems to me that the great tech company started because two people created a product that they wanted to use, that describes Apple, that describes Yahoo!, that describes Google. And so it is not because old people like me have recognized the trend, or recognized an opportunity. It is because two young people who did not know any better and did not know what they did not know, decided to do something.
[(8:26)] Martin: Yeah, that is it. Good answer, but you have an opinion, don’t you?
[(8:31)] Guy: I have an opinion. But you know, opinions are like orifices, everybody has one so-
[(8:37)] Jax: Yeah, what we’re saying is what is coming up on your radar.
[(8:40)] Guy: Look at people like Elon Musk. I mean, I do not think they are making intellectual decisions based on market research about what to do and what to invent. I think it is based on their gut, their vision, their passion.
[(8:55)] Martin: I mean if you look at my background, I am starting from a point of curiosity, then I am looking for validation. And if I am still passionate and interested, then I will go and invest in it.
[(9:05)] Guy: Yeah, and I think great companies start because the entrepreneurs ask very simple questions like, “Is there a better way?’ or “Isn’t this interesting? My favourite question to ask is, “Therefore, what?” And by that, I mean, you look at what conditions are evolving, and you ask yourself, “Well, therefore, what companies will be necessary?”
So to go back in history, let us say that you saw the growth of cell phones, and you figured out that cell phones are getting more and more common. They are getting smaller, they have cameras in them, and they are connected to a data network. Therefore what? Therefore, you start Instagram to share pictures. So that is the kind of insight that builds an Instagram, by asking, “Therefore, what?”
[(9:56)] Jax: So we are in a pandemic in 2021, which has changed a lot of the landscape, therefore, what?
Well, therefore online education, therefore virtual meetings, therefore reducing dependence on manufacturing from all over the world where, so many things could go wrong, whether it is a trade war between the United States and China or storms in a wide part of the United States. You are trying to reduce the exposure, you have to summon these risks.
Guy: And the concept before was, you know, every widget, and every colour, and every size, and every possible configuration, made in the cheapest place, we can find in China. Maybe that is not such a good philosophy anymore.
[(10:47)] Martin: Yeah, one of the ways also to look at an extension on what you are saying is, how do we redefine what we are seeing, so you can shine a lens on things. How do you redefine human connection? How do you redefine collaboration? How do these become splinter [?] opportunities? Clubhouse becomes Clubhouse video.
[(11:03)] Guy: That has completely changed because it used to be, you know, let us jump on a plane and go to Beijing, or go to Shanghai. Now, it is all virtual. Now arguably, I have to say I like it better. I have not been on an aeroplane since about March, and if I never get on another aeroplane, it would be fine with me. So I am cool.
[(11:24)] Martin: It is impossible for me, but I have dreamed about that outcome. But it is just not reality for me, but I hear you.
[(11:32)] Guy: Wait, you dream about the outcome of not flying or flying?
[(11:35)] Martin: Not flying. I live between New York and London, and I have an aircraft business. I love flying, I love aviation, but I do not like turbulence. I am also getting tired. So I just, if I could do without it, I would, but it would be a different world.
Martin: Let us talk about entrepreneurs starting a business or people that are already out there looking for their growth. Before we get into a lot of detail, is there like one thing in your career like you would say, this is what I tell entrepreneurs-
[(12:05)] Guy: Can I have two things?
[(12:06)] Martin: Yeah, of course, you can.
[(12:11)] Guy: Long-winded American [?] So the first thing is that, usually, your current customer cannot tell you how to truly innovate. That if you are selling them Apple 2s, they are not going to describe a Macintosh. If you are selling them Macintosh’s, they are not going to describe an iPhone. And so usually, your current customers can only describe what they want in terms of what they are already getting: Bigger, faster, cheaper Apple 2, bigger, faster, cheaper Macintosh, bigger, faster, cheaper, iPhone. So that is why innovation is so hard because there is nobody else to ask. So that is number one.
Guy: And number two, a very important philosophy I think, is you never ask people to do something that you yourself would not do. Now, this assumes you are not a psychopath, okay? Why are you asking your prospective customers to go through capture? If you hate it, why are you putting that speed bump in front of them? So it is things like that, that is a very good test that you are not asking your customers to do something you would not do, your employees, your vendors, your partners. You should never ask people to do something you do not want to do either.
[(13:19)] Martin: I think that is great. Let us go back to your first point though. I mean that one is very, very clear and I completely agree. But the first one, what is the point to the entrepreneur? You are actually trying to make. Because you are saying, do not ask customers. Well, you just defined it, the answer, that if it is bigger, faster, cheaper. Yeah, they can say those things, they can also improve the experience by telling you what they think of friction. But what is the output for an entrepreneur?
[(13:45)] Guy: Well, the ultimate output for an entrepreneur, at the highest level, I think, is to create a customer. And so, as opposed to raise money, or as opposed to provide a meaningful return to shareholders, I think entrepreneurship is all about creating customers. And if you create customers, everything else falls into place. So that is what an entrepreneur should focus on.
[(14:11)] Martin: I got you. Can we start back at your journey, it is fascinating. And like, this whole period in the 80s, I do not know if that is one of your more interesting periods of your life, but I would love to say if you could just describe that kind of the Apple experience, and how you ended up your marketeering in the world of the Macintosh, how did that come about?
[(14:34)] Guy: So my own version quickly is, that I am living proof of the value of nepotism. So I went to school at Stanford. And at Stanford, I met a guy named Mike Boich, and he and I became friends and roommates, and he was extremely technical. And so after graduation, believe it or not, I went to law school, and quit after two weeks.
He went on a different path and he ended up at Apple. So at Apple, he was Macintosh’s first software evangelist. So his job was to convince people to write Macintosh software. And he hired me, purely nepotism, because, on paper, I certainly did not have the right qualifications academically or work experience. So he hired me, and I became the second software evangelist, and the rest is history.
So there is a few lessons there, that number one, maybe the most important thing about your college experience is who you meet, as opposed to what you study. That is one. Number two is, it does not matter how you got the job, it matters what you do once you get the job. So I got it because of the nepotism, but once I got in there, I actually delivered, which is more important.
Guy: A third lesson is that your background really does not matter on paper, so I did not have the right background for that job at all. And I succeeded, and so I would encourage people to sometimes look beyond the resume and look beyond the LinkedIn profile.
Guy: I think one of the most important variables for entrepreneurs as they determine who to hire is not simply education and work experience, but does the candidate get it? Does the candidate love what you do? And I would make the case that someone who has the perfect education, perfect work experience who does not love what you do and does not get it, should not be hired.
[(16:34)] Martin: So you look for passion, right? What else other than passion, when you say they get it. It is passion to one thing. Is it creativity? Is it diversity? Is it perspective? Is it collaboration? These are softer, but important skills.
[(16:50)] Guy: They are important skills, but I also think that they are very hard to determine. And I think that, if you show someone your product or your service, and you watch how they react. You can tell in about five or ten minutes, do they get it or not? I think it is pretty obvious. And of course, the absolute best condition is when people show up and they already use your product or service. So, they got it early, and that is a deciding factor in who they want to work for. So that would be the best-case condition.
Guy: It is hard to imagine that if you want to get a job at Apple, during the interview, let us say the interviewer asks, “So what kind of Macintosh and phone do you use?” And the person says, “Well, I have an Android phone and I have a Windows computer”. Well, that is a non-starter, throw that person out already.
[(17:45)] Martin: I think the idea is the canvas or the building of culture, is that the actual thing that spreads the fabric, is everyone believes in the same thing, and they just love to be there. And like you said, maybe that also injects the softer things like collaboration because they just want to make this work, or they just did not love with what they do.
Martin: If I can, I would like to just say, how do you first will just define – so you have done a few things like you are a celebrated [?] author, you are a marketer, you are obviously an entrepreneur. I do not want to put those words in your mouth. Like what are you, or you are just many things?
[(18:19)] Guy: You know, at one level, evangelist and marketer. At a second level, a parent and husband. Arguably, that is higher than the first one. Third one is a passionate lover of surfing, which is different than saying I am a surfer because when you say you are a surfer, it implies you know what you are doing. I am saying that I surf, that is different than saying I am a surfer.
Guy: The bigger question that you may in fact be asking and not realize it is, what do I want to be remembered for? And I want to be remembered for two things: raising good kids and empowering people. So my mantra for my life is, empower people. I want to empower people with my writing, speaking, podcasting, investing, advising, basically, any kind of contact you had with me. I have empowered people to, as Steve Jobs said, dent the universe.
[(19:20)] Martin: I mean, that was like an epitaph, right? And listen, you are still going strong. And that might be at the end of the podcast, but I totally get it. I mean, you want to elevate people, elevate their lives, through your work.
[(19:34)] Guy: Yes.
[(19:35)] Martin: So, throughout your journey, We will go through your journey and to some more entrepreneurial stuff. I am interested to know what struck you most about your career? Because as you sprinkle through your writings, and your entrepreneurial pursuits, your venture capital, I now ask you to connect the dots, [inaudible] but what is that one thing– if there is one thing? Where you think, well, this has affected my life, and this is what I want to do different.
[(19:59)] Guy: Well, I would have to say from the outside looking in, I am an enigma. I never had this plan. I was born in Honolulu, Hawaii, and just because of a sixth-grade teacher who encouraged my parents to take me out of the public school system and put me into the private school and college prep system, that changed the arc of my life. Where if not for her conversation with my parents, and my parents willing to sacrifice to give me that private school education, I would not be here. So yeah, that is the very start, and then there is this serendipitous Stanford roommate who got me a job at Macintosh Division, and the rest is history.
Guy: So I cannot do [?] that I ever had a plan, and then, in the middle of all that, I became a writer, I have written fifteen books. So if you had told me in 1972 when I graduate from high school, that you are going to become a writer, and a speaker, and a podcaster, and you work for a high-tech company and become chief evangelist of, you know, unicorn [?] out of Australia. I would have told you, you are nuts. You know that is just not the arc of my life.
[(21:09)] Martin: You have talked about working with Steve Jobs, and I am interested to know what made you think he was a visionary and did anything rub off on you?
[(21:18)] Guy: Well, I think that in your career, if you do one big thing, you are in the rare air already, right? But if you look at Apple, and I will take Apple in general, not just Steve Jobs, but let us face it, he is responsible for most of it.
Guy: So, this is the person who basically created a company that did the Apple 1, the Apple 2, Macintosh, iPad, iPod, iPhone, Apple retail, stores, that was a convention-breaking thing. I mean, how many people have done five or six things, and then that is at a high-level product. But also think about, he was the person who started with putting a CD-ROM drive in computers and serial ports and just go down the line. And so many things happened because of Apple.
Guy: Some people who have done any one of those things would declare victory, and honestly should declare victory. But Steve did four, five, six of those things. That is, you know when six people tell you, you are drunk, you catch a cab. When you do 6th-grade things, you are pretty much a visionary. I mean, there is no question. And I would say the only person who is like that so far is Elon Musk.
[(22:43)] Jax: Was there any time where you are spending all that quality time with him as chief evangelist, with certain things that he do, attributes to his approach, or his outlook rubbed off on you, and staged you as you left the company?
[(22:57)] Guy: Well, he has a fantastic influence on me, and not necessarily in the way you might assume, which is basically, he scared the shit out of me. So he did not suffer fools if you know what I mean. And he would not hesitate to humiliate you not because he wanted to humiliate you, it was just his way.
Guy: He was not impolite, he was a-polite just like you can, you know, he was just like some people are not immoral, they are amoral. Well, he was a- polite, and he was just a what-you-see-is-what-you-get kind of guy. And I saw him just rip a few people in public, and contrary to every HR and personnel practice you have ever heard about maintaining a positive outlook and effectively communicating, and Kumbaya, and you know, all that kind of shit. Basically, Steve Jobs, I think, managed by fear. And contrary to every other HR theory I have ever heard, I can tell you something, fear works.
[(23:57)] Jax: I mean is that a lack of social skills, that is balanced by his visionary ability?
[(24:02)] Guy: Well, that is an academic way of saying it. It is a very interesting question. Let us take Steve Jobs out of the equation. Let us just say in general, but which comes first, so you can make the case that when you are a visionary and extremely successful, people put up with your bullshit, right,? So you can kind of be an asshole. So if you are visionary, you can be an asshole. But maybe being an asshole, scaring people, helps you become a visionary and successful. So which came first?
[(24:35)] Jax: Fair enough. Would you disclose that advice to future entrepreneurs as a management style?
[(24:41)] Guy: No. Because you know what? The asshole part is easy. It is the visionary part that is hard. So yeah, one of the dangers of becoming a student of Steve Jobs is, it is hard to separate causation from correlation. So believe me, there are a lot of people who say, okay, so Steve Jobs, he wore jeans, he wore black mock turtleneck, he wore new balance running shoes, he drove a Mercedes, he parked in the handicapped slot, he drove in the carpool lane by himself. So I am going to do all those things, and I will be the next Steve Jobs. No, you are not. You are just going to be an asshole.
[(25:17)] Martin: There is this another way to look at this, and that is it. You cannot look at outliers, okay? And this, to me, this is your stage, Guy, but I was a product of Steve Jobs. I interviewed once [?] I followed him throughout his career. I loved what he was. I did not like the fact that he was a little sociopathic. It is true.
Martin: And that fear was his number one thing. I mean, when in the room you best be prepared, and he would still have an outburst if it was not right. But no one can question the second coming. Or even Pixar, or essentially, the loan from Microsoft, and then to create the world’s greatest company. So something was right about this guy.
Martin: However, the outliers, Elon Musk get his guys, a statistical improbabilities. In fact, when you think about management style, you might want to take some of those assertions and behaviour, but you really want to be somewhere in the middle. Is that not fair?
[(26:15)] Guy: Yes, that is very fair. And this is one of the problems, which fundamentally, much business wisdom and business writing which is, it is not scientific. So, you can read the biography of Steve Jobs, or Richard Branson, or Elon Musk, Oprah Winfrey, anybody like that, but there is no science to that. The science would be, you control all the variables except one, and then you test that variable. But that is an artificial situation you cannot replicate in real life. It would be like saying, okay, so we take two people of equal talent, in the same size market, with the same potential, with the same product, one is an asshole, one is not. Let us test the asshole, you know, variable cannot do that.
[(27:04)] Jax: I think, if I was to simplify even further, I will just say some people just have it and some do not. Do you know what I mean? If I was to compare in my world when it comes to musicians. Some people go on to become Billy Eilish, and some people end up playing at the Roses and Arms [?] in East London. And it is not to say the person in the Rose and Arms is not talented. So some people just have it, and that you cannot match that disposition, that concoction, it just happens that way. So, Steve, that was his management style. I do not even think he learned that from anyway, that is just what he did.
[(27:39)] Guy: Yes, but I think it is very dangerous to conclude that his management style was sufficient and necessary to succeed.
[(27:48)] Martin: Yeah, agreed. Let us down the subject of Silicon Valley because I would like to just get some thematic moments out because you are a product of Silicon Valley, you went to Stanford, you are in that culture, it has produced some of the greatest companies in the world.
Martin: I think sometimes, as someone as sympathetic to technology, and I have spent a great deal of time myself out there. I just think that there is some drawbacks to this kind of bubble, this gigantic bubble, and it is unfortunate that you might have read in the press, with the whole issue with Australia, and this simple fight between the platform and the publisher. What do you make of that, have you read about it?
[(28:28)] Guy: Maybe you can explain it to me. I do not understand what is going on there.
[(28:33)] Martin: Alright. So let us throw it out then. Let me define this shit argument that is happening right now. But I think it is interesting because I think it is a lesson for entrepreneurs, but I will get to it in a minute.
Martin: The simple argument is that these monopolies have come about, Facebook, let us call them cartels, the Google. And they come under the unfair scrutiny and pressure from senators and other people alike, and the court to account because they have so much control. Whether it is your privacy, whether it is the way they control revenue, whether it is the way they dictate practices for other industries.
Martin: So the news guys, the Murdocks of the world, the publishers, they got deals, and the argument is, they think that when people share information on Facebook, or Indeed, or on Google, that they are not getting a fair share. So they use the lobby movement, or the megaphone of government to say, “Shit. How is this fair? They have got too much control.”
Martin: So there is a law coming out in Australia to ensure that there is fairness in the way that publishers get paid. I think this is incredibly engineered by the publishers themselves the news sources. And so Facebook went, hell no, let me tell you, you use our platform as well to build more awareness, to build more subscriptions for your publishing empire, etcetera and that is the rules of the game. So what has happened is, it is just an opportunity for them to negotiate again a deal with the tech giants. And I am not saying, it is much ado about nothing because it leads to them having to tarnish their brand in public.
[(30:01)] Guy: Well, wait, when you say they, you mean, they Facebook? Or they-
[(30:04)] Martin: They Facebook. So if this argument comes out, what Facebook just did recently, is take down external news in Australia. The problem they have got is they are washing their dirty laundry in public.
Martin: Now, what all that happens is they get over the fight, they renegotiate with the news publishers, but there is some deterioration in their brand equity. And that is what this whole argument is about. And it would not go away tomorrow-
Martin: Google have decided, we cannot win this war. Okay, we are done pretty well. Now they are making deals with publishers locally. And it is really just an opportunity to level the playing field between the tech giant and the media publisher. That is it. The problem is, the government has got involved and said, “Oh, I think there is a law here.” There is also one in the European Union. It is going around the world to try and not break up the cartel. This is not a browser war or anything like that. It is just to try and impose some limits around their control and allow partners to work better with them. That is it.
[(31:01)] Guy: But see, what I am missing is, let us take Google as an example. Google is helping you find information. So why does Google have to pay the New York Times to send people to the New York Times? The New York Times should be paying Google to send people to the New York Times. What am I missing?
[(31:23)] Martin: Well, I think on… So you got to think of Google News, not rather than search, but I do not think it is an unfair bias. That in pursuit of their mission, they are doing exactly what they should do.
Martin: A better example would be the Facebook situation that is happening right now. By the way, Google has conceded. They are making deals, brand new publishing deals, with the Murdoch Corporation with local Australian news doing the same in Europe. So they have decided, let us flatten it, and just have a better negotiation between the publisher and the platform. Facebook decided we do not like this because we think we are giving you a lot of press, we are sharing your news, and now you complain about the way the users share it? That is their argument.
Martin: So, if you do not like it, we will switch it off and it will affect the people that use our platform, and you would not get any awareness whatsoever. The argument is that they want to be paid more by Facebook.
[(32:15)] Guy: I mean, it is hard to feel sorry for either Rupert Murdoch or Mark Zuckerberg, you know. I would have to think about that. Whose side should I take in that argument?
[(32:27)] Martin: I am gonna throw it out there. I just think it is an argument much ado about nothing. But if you are an entrepreneur, you do not want to have your brand equity tarnished in the press.
Martin: So I am going to give you a great example. Fourteen months, right? Two hundred and twenty billion, Facebook, with the Senate hearings, and these when [inaudible] he said, “Well, this is going to change our algorithm when we are going to make less revenue. This was the upshot of it.” And all of a sudden you saw some short selling, and their market cap took a while to rebuild. That is a rash example of losing brand equity because trust was not with Facebook. This is the kind of thing that can happen to any entrepreneur if they are out in the PR area. You are developing their thing, you are developing whatever their new thing is.
Martin: I just think that what is the end consumer really care? But it struck me that it is just not really news, but actually, it can affect companies, and it can affect them at any level, any size.
[(33:27)] Jax: I mean when I am listening to all that, it just kind of reminds you how big some of these companies on, how much power they have over the world. And that has been coming out recently in terms of the drawbacks of some of the innovations of Silicon Valley.
Jax: When you talk about Silicon Valley it has been relevant for me in the last year, in terms of, especially even around the pandemic, false information, flawed medical advice from different people online, whether it is addiction to social media, these all innovations that are born out of Silicon Valley, and controlled a lot of the world now. We should view those as progressive things or drawbacks.
[(34:03)] Guy: Well, whenever somebody says Facebook and Google, and Apple, put anybody, Amazon, they are cartels and their monopolies. I just do not understand that because nobody is forcing you to use Facebook. If you do not like Facebook, do not use it. It is not like they are the only supplier of electricity or gasoline or water. So if you do not like Facebook, get off Facebook, what is the problem?
[(34:29)] Martin: Let me tell you, Guy just nails it. It is that simple. So if you do not like Amazon, then go to the fucking stores. If they had a bad experience, you just would not use them.
[(34:41)] Guy: Yeah, vote with your feet.
[(34:43)] Martin: Yeah, if you were being abused, you would walk away.
[(34:45)] Jax: No, but that does not take away some of the tactics on the plane, like the gamifying of it all. Not necessarily Amazon, because I love Amazon. The pandemic and Amazon has been amazing for me.
[(34:58)] Guy: I get a daily delivery.
[(34:59)] Jax: Exactly. I get my water delivered every two weeks now.
[(35:03)] Guy: You know what, someday the Amazon truck is going to pull up to my house and they are going to drop off, like two llamas, and I got to say, “Oh, who ordered that from my family?”
[(35:13)] Jax: To be fair, my recycling guy cannot keep up with my Amazon orders. The amount of boxes I am breaking down is actually, that is more stressful than the Amazon orders now.
[(35:21)] Martin: I have got to be careful, if I have anything to do with it, I am going to be delivering your parcels on your lawn, with drones.
[(35:28)] Jax: Yeah. That is a little key tip from me… But some of it, like the social media side of it where in particular, where kind of extreme views can kind of take hold, like even when I jump on Twitter, which in theory, is an amazing beautiful thing where you can share beautiful thoughts, but a lot of the world just do not have beautiful thoughts. And then, during this time has just been exacerbated where you have just got trending topics of just like, pure hate, basically.
[(35:54)] Guy: Well, you got to learn to ignore that shit. What is the problem? I do not…
[(35:58)] Jax: I could ignore it. You can ignore it. But a lot of the population cannot and they buy into it. I think some of the innovations are hard to manage.
[(36:07)] Guy: Yeah, I think the case should be made, that just as kids are taught math and writing, and reading, and all those kind of skills. One skill now is how to use the internet. At ten years old, I would make the case that it is more important to learn how to use the internet, than how to do algebra. I mean, you could say that… take case in point, right? So students should learn that just because an organization is a .org, it does not mean that they are a good organization doing good in the world. Because any clown with twenty bucks can get a .org, right? So you could be, you know, whitenazi.org. That does not mean that that is a good thing. So some of these really basic things need to be taught.
[(36:53)] Jax: That is a profound idea to be fair. I have not heard of that one.
[(36:56)] Guy: I am a profound guy.
[(36:59)] Jax: He is the guy. Damn.
[(37:00)] Guy: But you know what? I gotta say. Yeah, this whole like, let us break them up, big companies are bad, they are monopolies. If you do not like Amazon, do not use Amazon. My idea for Amazon was that we should recruit Amazon to administer vaccinations because there is no doubt in my mind if you said Amazon, you do the vaccination, everybody in America will be vaccinated in a week. A truck would be pulling up, the driver would get out, the nurse would get out, they jab you, wait fifteen minutes, and gone. And then, while you are there, you know, put the chip in me too, with the vaccination. So when I think of ordering something on Amazon, it already gets ordered, I love that.
[(37:40)] Martin: I am hearing brain-machine interfaces, doing away with any clinical trials and hygiene, and putting on the back of an electric vehicle. Something is wrong with this picture.
[laughter]
[(37:52)] Jax: It is not real.
[(37:52)] Martin: I love it.
[(37:53)] Jax: I mean, that is not actually a bad idea to get.
[(37:55)] Martin: Oh, fuck off. Come on.
[(37:58)] Jax: No, look. Look, let us be real.
[(37:59)] Martin: He is joking with you!
[(38:00)] Jax: I would be up for Amazon delivering me my vaccination.
[(38:03)] Martin: Let us talk about, you know, obviously you are a thought leader on entrepreneurship. You wrote The Art of the Start, you are an entrepreneur yourself, a marketer. You are in this bloody culture that is just, it is all they can think about, right? A big, big small town. What is it that you think are in the mindset of an entrepreneur? How would you define what you think of the main characteristics?
[(38:24)] Guy: I think that the main characteristic of an entrepreneur is that you fundamentally believe that the glass is half full, not half empty. That despite negativity and doubt, you can achieve things that the world can and should be a better place.
Guy: And that two guys in a garage, two gals in a garage, or guy and a gal in the garage can be the next very successful company. And it is fundamentally optimistic. This is not to say that an entrepreneur has no doubts, because if you do not have doubts, you are delusional, and you should be paranoid because you are in for a very competitive life, in a very trying, challenging career path.
Guy: But I think it is fundamentally optimistic, and the willingness to try, a growth mindset, that you are not stuck in the class that you were born in, you are not stuck in the circumstances you are born in, and that you can progress up and down the class structure.
[(39:24)] Martin: Yeah, so it is the mindset. What do you think of the success traits? I mean, there is obviously, or I think I coined years ago twenty-two, but you can put any number on the twenty-two.
[(39:35)] Guy: Twenty-two?
[(39:36)] Martin: Twenty-two, yeah.`
[(39:37)] Guy: Twenty-two characteristics?
[(39:39)] Martin: Traits. Characteristics, they are not really traits. I mean, a character itself could be mindset that they are the adjectives. But like risk resiliency, customer advocacy, right?
[(39:51)] Guy: I think if you come up with a list of twenty-two, it defeats the purpose because that is mind-boggling. It is too many.
[(39:59)] Martin: I think that yeah, I think if you subjugate them, you are right. You can get some confusion from them, but they are pretty distinct. But you have to give me three or four. What are the things that you think are most important?
[(40:09)] Guy: I would say, number one is grit. And number two is luck. And that is all you need.
[(40:16)] Martin: Wait, wait a minute. That is not a fucking trait, it is luck. You cannot generate it. You coined luck as a trait. I want that, tell me how I can be born with that.
[(40:27)] Guy: Be gritty.
[(40:28)] Martin: Grit is resiliency. Yeah, I get it.
[(40:30)] Guy: You got to work hard. And guess what? When you work hard and your resilience, you get lucky. We are gonna go on a little rat hole here, but I just read a manuscript of a book called ‘Working Backwards’, and it is by a guy named Colin Bryar. So he was chief of staff of Jeff Bezos.
Guy: And oh, what a fascinating book. I think that may be the most important management book I have read in ten years. And one of the key concepts obviously, because the book is called ‘Working Backwards’, is the concept that you work backwards from the customer, as opposed to forward from your capabilities. So you may be able to make a widget, but that does not matter. What you have to figure out is, what does the customer want, and then work backwards from the customer.
Guy: And I think that that is simple but such a devastating important insight, that is you start with the customer and work backwards. You do not start with your capabilities and work forward.
[(41:28)] Jax: Then don’t you puncture your chances for innovation if you are trying, because the customer would just want it bigger, better, faster, stronger.
[(41:36)] Guy: Yeah, but I am saying that you have to work backwards from the customer, what the customer wants or needs. I did not say that the customer can articulate that.
Guy: You could say that Steve work back from the customer, knowing that they would need a graphical user interface computer that they could use by themselves, even though they were not articulating that.
[(41:57)] Martin: So then you are saying the skill set of the entrepreneur is to get that information and then read between the lines?
[(42:03)] Guy: Or maybe you are Steve Jobs, and you build whatever the hell you want. And then you convinced everybody that they did want that, that is another way you could do it, but that is only Steve Jobs could pull that off.
[(42:13)] Martin: But also that is a bit of a common myth, and as much that it speaks to, the very first time he said that it sounded like he was devoid of customer feedback ratings or surveys. So the idea-
[(42:26)] Guy: He is.
[(42:26)] Martin: No, he built what they want to use. I think that is wonderful to say, look, we are creators and we build things that we would use our self. That is a great fucking proverb, but they also had customer research, and they were listening, and they listen all the time because they are one of the best.
[(42:42)] Guy: Says who? Who told you that Apple under Steve Jobs listen to anybody?
[(42:48)] Martin: Well because he was quoting customer reviews and surveys all the time.
[(42:52)] Guy: Well but he quote or whatever was convenient.
[(42:55)] Martin: Well, that is true now man, and I am not saying it was not convenient for him. Walt Mossberg turned up a few times when he said, “I think this is the greatest thing since sliced bread.”
[(43:04)] Guy: Well, I would say that a focus group at Apple, when Steve Jobs was there, was the fact that his right and left hemispheres of his brain were connected. That is the focus group.
[(43:13)] Martin: Richard Branson famously said, in fact, I interviewed him years ago in Jacksonville about this, and he turn around and said, “I have come up with ideas out of broken experiences.” I get on the plane and I think, God this is awful. I do not want this experience. So I am going to redefine the, you know, the red outfits and, the manicuring on the flight and everything. So he just observed these experiences. How do we re-engineer that? How do we just do something better? And it comes I think, from being internally curious. How important you think that kind of curiosity is for entrepreneurs?
[(43:47)] Guy: Oh, I think it is crucial. As they say, there must be a better way, that defined Apple. I think. There must be a better way than a mini-computer. There must be a better way than a Sony Walkman. There must be a better way than going into a big box computer store, that they have people who last week or driving cabs now telling you which computer to buy. So that is the Apple store. So there must be a better way is, a pretty rock-solid way to do it.
[(44:19)] Martin: Yeah. I love the Apple Store when it came out. I thought, wow. But, where is it going now? I mean, it has already transformed, and what are they going to do? Open up and create amphitheaters for Romans and have a few gladiatorial fights? I mean, that is what the marketplace do.
[(44:35)] Guy: What does that have to do with the Apple store? What?
[(44:38)] Martin: Are you kidding? What they are doing is unreal, right? They went with these…
[(44:41)] Jax: Do you think it is harder to innovate now, though?
[(44:44)] Martin: Well, no, I am not saying that. I am saying – the stores are amazing. They redefined the consumer experience. And the idea was, put the products among everyone, and let everyone be able to serve them wherever they are. I love this many-to-many relationship. It is unreal.
Martin: And then all of a sudden, the top exec left and they said, “How can we create more common places? Before the pandemic, they started to open up the stores. So you could create cultural events and other things to bring it to the outside. And this is their vision, and I think it is fantastic and it gets me to think, where is this going? Because we only think in moles, we only think in moles, but I am trying to figure out, what do they want? A train going through this door? I do not know.
[(45:23)] Guy: I think you should be thinking about other things.
[(45:26)] Martin: I cannot help you. I am internally curious about this stuff. Let us go on to leadership. Leadership is different to traits, right? What would you tell an entrepreneur or perhaps what you have done yourself in your life? What do you think they need to do as a leader in order to kind of just survive being an entrepreneur? Because it is kind of scary, right?
[(45:45)] Guy: Well, I think that first of all, a leader can never have a bad day no matter how bad your day is. You cannot have a bad day. That is number one. Number two, I would say that the most important thing for a leader is to hire people who are better than himself or herself.
Guy: If you are the CEO, and you look around your staff meeting, you should say with great pride, that person can do finance better than I can, that person can do marketing better than I can, that person can do engineering better that I can and that person can do operations better than I can. So when you look around the room everybody should be better at their function than you are, that should be a source of great pride. We should be so lucky that leaders thought like that.
[(46:25)] Martin: It is like me saying, “Look, I am so grateful you are here, which I am, right, because you have got an interesting perspective.” You have to tell them. This is the important thing about leadership, is to relay that you are not just sapping their energy or insulting them. You are actually saying, “Thank you for that insight because we is smarter than me, right? I am glad I hear it from you because you are good at this.”
[(46:46)] Guy: What we used to say in the Macintosh Division is that A players hire A players. But B players hire C players, and C players hire D players. So soon as you start hiring B players, you can assume C players and that is what we call the bozo explosion.
[(47:04)] Martin: Could you define that? [cross talk] Come on, give us a bit more of a definition. I like that.
[(47:09)] Guy: What more do you need to know?
[(47:14)] Jax: He is basically saying people get thicker and thicker as they go.
[(47:17)] Martin: Okay. I do not want to challenge this fucking dichotomy, but I would argue that the bank’s out there, say that they want to hire people that can ultimately improve themselves and become leaders, and everyone is going to be the CEO of their life, to CEO, as a manager [?] and they climb to the top. [cross talk]
[(47:32)] Guy: Who says this?
[(47:32)] Banks say that I was at JPMorgan. This was all they talked about, but actually, there is something in larger organizations where you want talented great people, but there are, unfortunately, organ grinders that should not be perceived as organ grinders that do not need to actually be like that. They can be flattered and they can be loyal and they can be competent but not everyone is going to move at the same speed. I mean that was a bit of point. They are not bozos.
[(47:54)] Guy: I do not know if you should use large investment banks as the example of innovation and entrepreneurship.
[(48:01)] Martin: Hell, yeah. Well, I guess if it was, a good point. But then the fintech [?] movements proven us wrong, right? I mean, they have got the largest data pool in the world. But I agree, I would not say that the most Innovative on the planet, but they did have the biggest integrations they could ever work on.
[(48:14)] Guy: At the end, let us say you are in private equity, okay? Or finance. At the end of your life. What do you say you accomplished? How did you make the world a better place? [pause] Go ahead. I am waiting.
[(48:29)] Martin: You put me on the spot. I mean, I want to remind you guys I asked the fucking questions – no I am just kidding. No, I mean you are talking to a guy that is almost nine years in JP Morgan. I agree. Look, I am an entrepreneur, I was accused of being an entrepreneur. I was a maverick. The things I did there were kind of scary throughout my career, but it also shaped a lot of what I am. Do I think I am satisfied if I was just dealing with financial instruments or risk? It is a necessary evil. It is a currency for the world that we live in, but I think there are better ways to impact your life or legacy.
Martin: No kidding at all. Having said that, if you are an innovator and you are in tech and you want a big data challenge, a word that gets overused, and you want to look somewhere to stress test that, then banks are a great place because the data is awful, the legacy systems are awful. So that will give you great scale and great intellectual acumen if you can solve some of their problems. And they are cutting people every five minutes, so you got shunned.
[(49:33)] Jax: I am just saying that there is great fintech opportunities, right?
[(49:38)] Guy: So my take here is a great innovation occurs, not because of better sameness, but in order of magnitude difference. And the example that I like to use is ice. So it used to be that you got ice from an ice harvester who cut a block of ice out of a frozen lake or a frozen pond. Fast forward fifty years. Now you have an ice factory. So it does not have to be a cold time of year and a cold location.
Guy: You can freeze water in a factory any time of year. Jump another fifty years and now you have a refrigerator curve. And now, you have your own personal ice factory, but none of the ice harvesters became ice factories and none of the ice factories became refrigerator companies because most companies define themselves in terms of what they already do.
Guy: So if you say that you harvest ice, you do not embrace the factory. If you say you freeze water centrally and put it in a nice truck, you do not embrace a personalized factory called a refrigerator.
Guy: And the greatest example of this story is that in 1975 an engineer at Kodak invented digital photography. Well, let us just say none of us use a digital camera from Kodak today and that is because Kodak defined themselves more as a chemicals company or and what they should have done is defined themselves as a memory preservation company. And if you say that your business is to preserve memories, then does it matter if it is chemicals on film, chemicals on paper, or digital sensor? No.
[(51:03)] Martin: When do you know when to pivot in something like that?
[(51:08)] Guy: Well, obviously if you are Kodak, you know who can blame them, right? So they are printing money. They are very successful. They are selling film, you know-
[(51:15)] Jax: That is what I am saying, you are locked in your tunnel vision, you are trying to build profit, you are trying to drive the business forward. For you, what you are saying is happening in parallel, and then you choose to jump and follow that instead at some point.
[(51:29)] Guy: Well, at least you could hedge bets, right? But could Kodak have threaded the needle and continue their film business while they created digital photography? I guess with hindsight that would have been a smart thing to do. I cannot tell you that it is easy to do it when you are the guy or the gal who has to make that decision, but I do not know if you guys ever had them, but when is the last time you went to a blockbuster store to rent a DVD?
[(51:58)] Martin: I mean it is closed down now.
[(51:59)] Jax: Right so, you know Netflix is the next curve.
[(52:03)] Jax: Okay, so you will constantly innovate in to continue on to the next curve. So let us take your Netflix now they are having an incredible period. The pandemic was laid into their hands and everyone is streaming like crazy. What should they be looking for or a company in that kind of situation where you say they are printing money. How do you spot when is the time to look at the next curve?
Jax: Are there some signals or they are like little litmus test? You know what I am saying? Or do you just run R and D the whole time?
[(52:31)] Guy: Well, that’s why it is easier to be the guest on a podcast than to be the CEO of Netflix.
[(52:39)] Jax: True. Although you have coined the name. I like it. I am just thinking about how can attribute it. So I am thinking okay. I am knocking out songs that are traveling, things are doing well. What do I do now? Do I try and invent the next Spotify alongside trying to have my next hit?
[(52:54)] Guy: Well, you know, let us apply this to podcasting, right? So you could define podcasting as we get guest, we record it, we edit it, we sound design it and we put it up and people download it. That is one way of defining podcasting.
Guy: Another is, that we are in the business of helping people understand and communicate ideas that that is the bigger picture. So now, you know, I could make the case that may be something that – the new buzzword here is social audio. So maybe, social audio, i.e. clubhouse is the next curve in podcasting.
Guy: Now this is the stretch here, but think in 1975, if somebody said “Hmm, you know digital photography is the next curve in photography in the middle of selling film.” So it could be that you know, social audio, clubhouse, getting people in a room listening to me talk to you guys instead of what we are doing now, recording that maybe the next curve in podcasting.
[(54:02)] Jax: So it feels like the first step to help you jump from curve to curve is actually not to narrow yourself into early by your own definition. It is the open in your outlook of how you help people.
[(54:16)] Guy: Yeah. I think you have to define what you do in terms of the benefit that people derive as opposed to the process that you are doing it. So the process is, we put chemicals on film but the benefits that people derive is the preservation of memories.
[(54:33)] Martin: Yeah, that is a great point. Clubhouse is an interesting experiment obviously, as early. Whether it is another jump to a curve or just can you curate better? Can you control the rooms better? Because what we have here is we hope to get is a highly controlled conversation. The rooms do not – you [inaudible] that. It fills you a lot of [inaudible] and other stuff but you can get big audiences and you can do it live.
[(54:57)] Guy: But the moderator does have control who they bring up, right? So there is-
[(55:02)] Martin: To some degree.
[(55:03)] Guy: It is not total anarchy.
[(55:05)] Martin: No. But they do not know what is coming and I guess to some degree, it is live so you cannot do any edits. It is just there.
[(55:15)] Guy: Yeah, that is a plus and minus, right?
[(55:17)] Martin: Yeah. No, totally. All right. So let us talk about networking. So in your in your time, I always think that some of the great case stories of networking. Well, actually not references from the UK and they were not references from New York, there were references form the West Coast. But then often LinkedIn came and all these things. I did not really think it was a qualitative way to build a network but entrepreneurs need to get out there and find ways to collaborate, find ways to hire, find ways to share insight and it is all about this networking. How has that helped you in your career? Do you have any perspective on this as an entrepreneur?
[(55:53)] Guy: You may find this hard to believe but I am fundamentally an introvert and I do not need the attention. I do not need to be out there. I think networking is a necessary evil at the start of entrepreneurship, at the start of your career. And the interesting thing is, how does the pandemic effect that because obviously we are not all going to mixers right now. Although I hate mixers anyway, so I never used to go to them. So knock social media as much as much as you like.
[(56:24)] Guy: I have hundreds, if not thousands of relationships with people that could never have happened without social media. So for all the bitching about social media, I am not one of those people I think social media has been fantastic.
[(56:38)] Martin: Do you think that social media is kind of something that is just going to go or do you think there is going to be another curve? I mean, I think the clubhouse almost is just another form of social media. But do you think this is something that is just going to ultimately go well? Do you think it is with us for a long time?
[(56:54)] Guy: Well, hard to imagine that social media is going to go away. That horse is out of the barn and procreating. And it provides too much utility. You can focus on the negatives of social media. So that is how they assemble the riot in the capital or that is where pedophiles hang out or yeah – okay, there is plenty [?] that is where abuse and that is where body shaming and blah, blah blah all these bad things happened, no question, but let us also remember so many good things happened.
Guy: Listen, back in 1975, the three of us would not be doing this and we would not be reaching and what we will be doing sending group faxes right now. I mean, how would that work?
[(57:38)] Martin: Or carry a pigeon. [?]
[(57:41)] Jax: Yeah. You are right though. I think everything, any innovation has its pitfalls, like even if less obvious things like we are people talk about it quite lightly by we talk about Netflix and the binge and how people invest all their time into it and lose days and do not interact. That is their own choice at the end of the day.
[(57:58)] Guy: Well, yeah I mean you could make the case that Gutenberg’s printing press, you know ruining literature right now. Anybody could print a book you just have to buy a press.
[(58:08)] Martin: And giving it’s commoditize you do not even need that. At least for us. So, let us talk about kind of the final kind of segment, talk about expertise, passion, and opportunity, which you have talked about. Can you explain I guess like the sweet spot between expertise, passion, and opportunity? Why are these three things important to you or important to entrepreneurs?
[(58:29)] Guy: Well, I think the right mental framework for that is to draw a Venn diagram. So you draw a Venn diagram that has your interests, and then the opportunities and your expertise and where they all intersect, that is where you should be. Because if you are interested and you are good at something but there is no opportunity, then there is no future so you need all three so I think that is the way to think of it as a Venn diagram.
[(58:59)] Martin: I think that is probably the most articulate way of looking at it. That is your sweet spot. When you look at opportunities yourself. I am just curious. I always am fascinated by people like me that just meander into lots of things that become meaningful. To have some kind of purpose.
[(59:16)] Guy: That is me.
[(59:17)] Martin: Yeah me too. Too many investments in multiple companies and I think, “What am I doing?” and I can tell you that I was passionate. I have some expertise and I am spotting opportunity. What do you think about what that why you are doing what you are doing? One thing is necessity, another one is your just intensely curious, or you are helping out friends. What is it?
[(59:39)] Guy: I do not have any rational intellectual explanation for what I do. I just fall in love with some stuff and sometimes I fall in love and sometimes I do not. It is not a science although, maybe to use the Malcolm Gladwell theory that I have done things for ten thousand hours. So now in a blink, I can make a decision. Did I decide really quickly or did it take forty years to get to the point where I can blink and decide? I think it is closer to that that my off-the-cuff immediate gut reaction, is the product of forty years of trial and error. It is not just a flippant kind of you know, yeah or no.
[(60:21)] Martin: But along that is you jumping into things. You did not take forty years to jump into things. You probably did them quite quickly you fell in love-
[(60:29)] Guy: And I have been more wrong than right, do not get me wrong.
[(60:31)] Martin: Oh for sure, as all of us. I wanted to think about. Oh, I want you to give us a view if you can on what can we be doing while we are in this wonderful transition phase.
Martin: To me, probably the best thing has been reflection. Is that while we are changing we are reflecting and actually we are finding new things about ourselves and about the kind of way we can be productive.
[(60:54)] Guy: And in many cases, in my case. I am spending more time with my family than ever. I used to make seventy-five trips a year. I make zero. Well, if we had proper leadership we could have nailed this four months ago, right? But no, I mean we decided. We decided that it was not real or we decided that mass do not matter or washing your hands do not matter or you know, it was a suppression of my freedom to not be able to go out.
[(61:22)] Martin: Given I live in both places. It astounds me I share your frustration. But here is the thing, seventy-five million people. I do not think in politics that it is about the mind. I think these bits in the heart, it scares me. But what worries me is that people cannot see it. That somehow empathy and compassion has been lost in the translation of parties and politics. It is shocking. You know, it is what it is.
[(61:47)] Guy: Well, but I think many of those people have been misled. It is not their fault. I think they have been misled.
[(61:53)] Jax: No! I mean just to bring it back to startups though like [inaudible] [laughter] to our listeners. I think what we are trying to get at is,
this is a difficult time and as we say is transitionary and a lot of moving parts and we have spoken a lot about are big subjects here.
Jax: Innovation, the jumping the curve, and all these things which are great and hard to do even in normal conditions. What tips would you give to people who just have to do their startup now because you said it is never a good time. It is never a bad time just start if it is in you, you start. What tips would you give them at this point to be innovative and to launch their startup?
[(62:33)] Guy: So, ask yourself the primary question, which is, “Therefore, what?” you know looking at what you see happening what you think will happen. Ask yourself, therefore what is needed? That would be a rich vein. Another rich vein would be to build the product or service that you yourself want to use because I think that defined the genesis of Apple, Yahoo! And Google, really, all the great text even Facebook.
Guy: I think all the great, tech companies started because the founders built something that they wanted to use which is very different than being quote “market-driven” and looking at marketing reports that say, you know in the year 2030, just going to be a five billion dollar shrimp farming software market. So let us go into shrimp farming.
Guy: Build what you want to use and just hope that you are not the only psychopath in the world who wants to use that product and remember that the purpose of a company is to create customers. It is not to raise money or make you rich. It is to create customers if you create enough customers everything else falls into place.