Ep 54: Charles Schwab: The big entrepreneur looking out for the small investor

Charles Schwab is the founder and chairman of The Charles Schwab Corporation. What began as a small discount brokerage company in the 70’s has evolved to become the nation’s largest publicly traded investment services firm, with close to $4 trillion in client assets. He is also the chairman of The Charles and Helen Schwab Foundation, a private foundation focused on education, poverty prevention, human services, and health.  He is the author of several bestselling books with his latest memoir titled Invested.

 

Some interesting insights from this episode:

  • He had to work extra hard to build his self-confidence to overcome his dyslexia and to keep up in class.
  • People with dyslexia are conceptual thinkers who tend to not get lost in the weeds. Some people are very literal in learning and need to go from step 1 to 2 to 3 while dyslexics can go from step 1 to step 10.
  • Seeing an inherent conflict of interest between commissioned stock brokers and the customers, he invented a new contrarian business model by paying salaries to people placing trades with a bonus tied to the overall success of the company.
  • After the tech meldtown of the early 2000’s, Charles had to come out of retirement to run the company again. He had to lay off thousands of employees and get the company turned around.  Sometimes founders are the only ones who can make the tough calls and drive huge fundamental changes to the business.
  • He was a consummate innovator who continually pivoted, redefined the business, and opened up new markets. He knew it was important to disrupt yourself before someone else did it for you.
  • When hiring, beyond skills and experience, he looks at their character and ethics and their responsibility to the customer.
  • “Excellence is an ongoing pursuit. You are always striving for it but you never achieve it.”

Ep 53: Safi Bahcall: Physicist, Biotech Entrepreneur, Organizational Behavioral Guru

Safi Bahcall received his BA in physics from Harvard and his PhD from Stanford. He co-founded Synta Pharmaceuticals—a biotechnology company developing new drugs for cancer.  He led its IPO and served as its CEO for 13 years. In 2008, he was named E&Y New England Biotechnology Entrepreneur of the Year. In 2011, he served on the President’s Council of Advisers on Science and Technology. Safi is the author of Loonshots: How to Nurture the Crazy Ideas That Win Wars, Cure Diseases, and Transform Industries. The book was selected by Malcolm Gladwell, Dan Pink, Susan Cain, and Adam Grant for the Next Big Idea Club.

 

Some interesting insights from this episode:

  • “Very often people go on a path that the world expects them to without ever pausing to say ‘why am I doing this?’”
  • For an entrepreneur, the critical ingredient for success in building a company is surrounding yourself with talented executives and then bridging the divide between people who wouldn’t naturally interact with one another.
  • Culture are the patterns of behavior you see on the surface in an organization while structure is what’s underneath that’s driving those patterns of behavior. The activities being rewarded (i.e. incentive structures) will drive the culture.  So it’s the structure that’s ultimately most important in influencing behavior.
  • As companies mature, employees tend to shift from focusing on collective goals toward focusing more on careers and promotions. To reduce that behavioral shift, you want to minimize the growth in compensation that comes with each level in the organization.  In addition, you want to maximize span of control.  With fewer promotions and less of a financial incentive as you move up the organization, employees will focus more on their projects and less on corporate politics.
  • You want some employees focused on activities that reduce risk and another set of employees focused on maximizing intelligent risk taking. Effective leaders create a dynamic equilibrium between these two groups and are able to effectively balance the core with the new.
  • Most innovative products will have at least one or two false fails on their way to achieving significant market traction. The key to success is to get really good at investigating failure and not just accepting it on face value.
  • Companies need to create a new C-suite role called a Chief Incentives Officer whose job is to design customized incentive packages to motivate employees and optimize outcomes.
  • “Excellence is always striving to improve yourself and improve your performance.”

Ep 50: Steve Schwarzman: Co-founder and CEO of Blackstone

Steve Schwarzman is the co-founder and CEO of Blackstone, one of the world’s largest and most successful investment funds with over a half trillion dollars under management. Steve is an active philanthropist with a history of supporting education, culture, and the arts.  He holds a BA from Yale and an MBA from Harvard Business School.  His new book is called What It Takes: Lessons in the Pursuit of Excellence.

 

Some interesting insights from this episode:

  • He has always been very competitive. When he graduated from Yale, he insisted upon an extra $500 a year in his offer from a prestigious investment bank so he could be the highest paid graduate from his class.
  • “What I lacked in basic economics, I made up for with my ability to see patterns and develop new solutions and paradigms, and with the sheer will to turn my ideas into reality.”
  • He single-handedly advised Tropicana on getting acquired, which was the second largest transaction in the world that year, even though he had absolutely no M&A experience up until that point.
  • “To be successful you have to put yourself in situations and places you have no right being in. You shake your head and learn from your own stupidity. But through sheer will, you wear the world down, and it gives you what you want.”
  • They closed on their first fund of $1 billion the morning of October 19th, 1987, aka Black Monday, the largest one day drop in stock market history. Just one day later and Blackstone might not have ever gotten off the ground.
  • After losing some money on a deal, he re-architected the entire investment decision making process to be much more rigorous with the goal of engineering out the risk so as to never lose money again
  • He has a philosophy to only hire “10’s”. Those people tend to be intelligent, articulate, calm, energetic, curious, and can envision the future.
  • “Excellence is being the best that you can be at whatever you choose to do.”

Ep 47: Rich Karlgaard: Publisher of Forbes

Rich Karlgaard is a bestselling author, award-winning entrepreneur, and speaker.  He is the publisher of Forbes magazine and is based in Silicon Valley.  He is a renowned lecturer on technology, innovation, corporate culture, and a number of other important business issues and the author of three books, his latest one titled: Late Bloomers: The Power of Patience in a World Obsessed with Early Achievement.

 

Some interesting insights from this episode:

 

  • His time at Stanford poring over Sports Illustrated in the library would later become the genesis for starting up what would become a highly popular technology business magazine.
  • Starting up Upside Magazine which had a unique style and voice ultimately led to a coveted role with Forbes despite the magazine not being a financial success.
  • Our cultural obsession with early achievement is detrimental to society.
  • Some people are successful because they’re competitive and set goals for themselves. Others achieve success because they are explorers chasing their curiosity without an end in mind.
  • Between the ages of 18 and 25, our prefrontal cortex is still growing and our executive function skills are still developing. Yet, this is the exact time when we’re supposed to be laser focused on launching our future careers.
  • One of the most important traits CEOs of high performance companies look for in new recruits is curiosity because without curiosity there’s no growth.
  • Notable strengths of late bloomers include curiosity, compassion, resilience, insight, and calmness.
  • “Resilience isn’t just the ability to be tough but the ability to have enough built in flexibility so an unexpected failure doesn’t shatter you.”
  • At any given time, there’s an optimal use of your time, your talent, and your effort.
  • “Excellence is the intersection between your perfect native gifts and your sense of purpose that is so deep you’re willing to sacrifice for it.”

 

Links:

Find Rich Karlgaard’s book Late Bloomers here.

Find Rich Karlgaard’s personal website here.

Ep 45: Eduardo Strauch: Andes Mountains plane crash survivor

Eduardo Strauch is an architect and painter living in Montevideo, Uruguay.  He is also one of 16 survivors from a 1972 plane crash in the Andes mountains which was charted by an amateur Uruguayan rugby team.  He survived 72 treacherous days trapped high up in the mountains.  He wrote a book about his experience called Out of the Silence: After the Crash.

 

Some interesting insights from this episode:

  • Learn how he and 15 others managed to survive for over two months with minimal provisions, subzero temperatures, and thin air which was very difficult to breathe.
  • Learn how spontaneous meditation helped free his mind and save his life.
  • Mental strength was as important as physical strength for survival. You had to maintain hope and continue to have positive thoughts and believe that things would eventually work out.
  • You had to learn how to control your mind in order to do what was needed to survive. “It was essential to strip away the deep associations of the past from our actions and maintain that strict separation to be able to act.”
  • Once they ran out of food, they had to get past age-old societal norms and resort to cannibalism to survive.
  • “We all occasionally fell into bouts of deep depression, but then the group would notice it and act in support of that person, like a living organism trying to rebuild its own weak cells.”
  • From the very moments following the crash to this day, Eduardo has learned to appreciate the value of life.
  • “Excellence is to be in peace with oneself and ensure that you are living the life you must live.”

Ep 43: Roger McNamee: Tech investor, musician, activist

Roger McNamee has been a successful Silicon Valley investor for thirty five years.  He co-founded Silver Lake and Elevation Partners, two very successful private equity funds.  He also plays bass and guitar in the bands Moonalice and Doobie Decibel System.  He holds a BA from Yale and an MBA from Dartmouth’s Tuck School. He has written 4 books, the latest one titled Zucked: Waking up to the Facebook Catastrophe.

 

Some interesting insights from this episode:

  • Roger had a very unusual approach to tech investing which allowed him to be highly successful.
  • Learn why he started Elevation Partners with U2’s Bono.
  • Hear how one pivotal meeting with Mark Zuckerberg would forever alter the course of Facebook.
  • It was Facebook’s lack of anonymity that Roger felt was key to bridging the gap to a much larger mainstream audience that prior social media companies had failed to reach.
  • While they are technically a platform, Facebook acts more like a media company by using sophisticated algorithms to control the content that users see on the site.
  • Social media manipulates us by exploiting the weakness in human psychology.
  • Learn what filter bubbles are and why they’ve contributed to our accepting and spreading false information.
  • “Technology has changed the way we engage with society, substituting passive consumption of content and ideas for civic engagement, digital communications for conversation.”
  • “Excellence is an outcome that reflects mastery of an activity in a time and in a place.”

Ep 41: Albert–Laszlo Barabasi: Unlocking the formula for success

Albert-László Barabási is the Robert Gray Dodge Professor of Network Science at Northeastern University, where he directs the Center for Complex Network Research, and holds appointments in the Department of Medicine at Harvard Medical School and the Central European University in Budapest.  He is the author of four books with his latest one entitled: The Formula: The Universal Laws of Success. 

 

Some interesting insights from this episode:

  • The definition of success is the rewards we earn from the communities we belong to. While your performance is about you, your success is about us.  It’s what we as a community acknowledge and value.
  • The first law of success is that performance often drives success but when performance can’t be measured, networks drive success.
  • The second law of success is that performance is bounded but success is unbounded. Marginal differences in performance may lead to order of magnitude differences in success (fame, fortune, recognition, etc.).
  • The third law of success if that prior success will increase the odds of future success. It is the law behind why the rich get richer and the powerful stay that way.
  • The fourth law of success is that while team success requires diversity and balance, a single individual will inevitably receive credit for the group’s achievements.
  • For performance oriented teams, diversity and empathy are the most critical success factors while for innovation oriented teams, leadership is most important.
  • The fifth law of success is that with persistence, success can come at any time. Your ability to succeed neither declines nor improves with age.

Ep 38: Mark Tercek: The Nature Conservancy CEO

Mark Tercek is the CEO of The Nature Conservancy, the world’s largest environmental organization. He is a former Managing Director and Partner at Goldman Sachs and is the author of the bestselling book Nature’s Fortune: How Business and Society Thrive by Investing in Nature.

 

Some interesting insights from this episode:

  • We all have an inner environmentalist inside of us.
  • His executive coach taught him some valuable lessons early on including how to listen better and how to not sweat out the details.
  • In the nonprofit world, he had to learn how to understand employees’ psychic income and use that as motivation to drive behavior.
  • Saving nature isn’t just the morally right thing to do, it’s also the smartest investment we can make.
  • Learn how he pivoted his 4,000 employee organization from pure land conservation toward embracing climate change as a top priority.
  • “Excellence is matching ambition with a good dose of reality.”
  • We all have a tendency to overestimate risks in our lives. The returns are greater than perceived and the risks less that perceived.  More of us should just go for it.