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Entrepreneurship Expert: How To Build A $1m Business Without Hard Work! | The Diary Of A CEO | YouTubeToText
YouTube Transcript: Entrepreneurship Expert: How To Build A $1m Business Without Hard Work!
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Video Summary
Summary
Core Theme
This content explains the fundamental components of any business and offers practical strategies for learning new skills rapidly, emphasizing that understanding business principles is a "superpower" accessible to everyone, not just those with formal business education.
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so every business from the smallest
startup to the largest corporation in
the world has five fundamental Parts if
you want to create a business or
interviewing for your first job or
interviewing for your first big
promotion understanding this is a
superpower it's so exciting and fun Josh
Kaufman the world famous business Expert
entrepreneur and best-selling author
Renown for his practical approach to
mastering business productivity and
Rapid skill acquisition this is the
foundation of every business plan that
has or ever will exist so Step One is
value creation find those important
unmet needs and then focus on meeting
those is this enough of a problem for
you to pay money to solve it how do you
find out if there's a big enough market
for your idea the easiest best thing to
do is just step two then marketing and
humans have five drives the drive to
acquire to bond to learn to feel to
defend and the more drives that you hook
into the more attractive the business
offer is going to be so what is step
three the third part of every business
is the fourth part is particularly
important which is and the fifth part is
what a lot of people struggle with but
I'm here to help you so the fifth part
is Josh The Narrative out in the market
is you have to do 10,000 hours to learn
anything you're telling me it's actually
20 hours is the key yes or 40 minutes a
day for about a month so how do I do
that then the best way to approach this
is to start with that's the secret
congratulations Dio gang we've made some
progress 63% of you that listen to this
podcast regularly don't subscribe which
is down from
69% our goal is 50% so if you've ever
liked any of the videos we've posted if
you like this channel can you do me a
quick favor and hit the Subscribe button
it helps this channel more than you know
and the bigger the channel gets as
you've seen the bigger the guest get
thank you and enjoy this episode [Music]
[Music]
Josh why why why did you write a book
called the personal MBA it's a world
class Business book that sold almost a
million copies so far it's a real iconic
book in the category but why why did you
feel compelled to write that book
because I can tell by the thickness of
it it took you a long time it did so
there must have been some sort of
personal motivation that was pretty
strong to write that book sure uh a
couple of things um curiosity
and persistence and I was solving my own
problem um so one of the things that
that happened is right after school I
got a job at a big company and I was
working with a lot of people who had
just graduated from top 15 business
programs um I got this job straight out
of undergrad I had no idea what I was
doing and I really wanted to learn like
what what are what are we doing here
what is what is business how does it
work what's important to know what
what's not important to know and so one
of the things that I tried to do with
the personal MBA um and and one of the
the reasons like how the project got
started was I figured that there was
there was a book written by a business
school professor in the 1950s or
something and I just needed to go out
and find that book and read that book
and then I would understand the
fundamentals then I would understand the
basics of of what it is that that we're
all doing here
and I looked and I looked and I read and
I read and I I couldn't find it and so
at a certain
point that I had essentially spent
months reading just going through
category after category just trying to
understand for myself what businesses
are how businesses work and at a certain
point I realized like this is important
to me and there's something that should
exist in the world that for some reason
doesn't exist in the world and I think I
need to be the person to make that to do
that and so that's when the personal MBA
be went from just this crazy side
project that I that I did post undergrad
into essentially a second full-time time
job reading and research and and trying
to to decide for myself what are the
critical parts of business how do
businesses work how do they function and
then I decided to put that in a form
that other people people could read and
benefit from as well what is an MBA
master of Business Administration it's
big big degree um actually one of the most
most
economically uh successful academic
degrees that exist um over the past
several decades uh growth in uh business
masters programs worldwide has has just
exploded and so for better or worse when
adults decide that their interest
in business the first thing they do is
go to Google or Amazon and they type in
the letters MBA and they start looking
for graduate business school school
programs and I think that's a mistake I
think there's there's a reason that
people want to learn business there's a
reason that people um find this area of
of knowledge useful and I don't
necessarily think Academia is the the
place to start I think there's an
enormous amount of business knowledge
and skill that you can develop on your
own um by understanding the most
important Concepts around what
businesses are and how they work and
using them in your day-to-day life using
it in the career that you already have
using it to start something new on your
own and just a a few very simple
straightforward ideas go a very long way
and so my goal in writing the Pumba was to
to
explain business to someone who has no
knowledge no experience no idea what's
going on start from absolute Square zero
and explain all of the different parts
of a business how they work how they
interrelate to each other and so you can
take that knowledge and do good work
whatever it is that that you do in your
life or in your career when you say do
good work we're talking about an outcome
there what kind of outcomes do you think
if someone's just clicked on this
conversation now and we you know with
the knowledge that we're going to talk
about this as many as well as other
things what do you think the outcome for
them could be if they got access to the
information that you put in this book
the personal MBA but also from listening
to this conversation sure uh so many of
of the readers of the personal MBA over
the years um our early career
professionals are just getting started
in their career in some way shape or
form and I can't tell you the number of
times that that I've heard from someone
who's like I'm interviewing for my first
job or I am interviewing for my first
big promotion um I actually have a
friend who is who was in this position
uh a couple months ago she's like I'm a
skilled professional I've been working
for a while there's an opportunity to
move into management here and part of
that interview is going to be they're
going to ask me like how how do we
improve the business that we're in she's
like I'm trained as an engineer I don't
know about any of the this business
stuff and so there's a very simple way
of understanding what a business is what
a business does the primary parts that
every single business has and and how
those processes
interrelate and what that knowledge gets
you is the ability to take a look at any
existing business and understand it in a
very deep and fundamental way so you can
take a complex organization you can
break it down into parts that are very
simple straightforward easy to
understand and then you can take that
knowledge to ask a series of very useful
questions how is this business creating
value how do they attract the attention
of people who might want or need what
this business provides how do they
convince people to pull out their wallet
or checkbook or credit card um and and
give the business money how does the
business deliver the value that it it
promising to its paying customers and
then is the business bringing in money
how's the business spending money and a
is it bringing in more than it spending
if not there's a problem um and more
importantly is it enough is it enough to
make all of the time and energy and
effort that's being put into the
business by the owner and the employees
worthwhile and that's the essence of
finance and so understanding business in
this very systematic way is a superpower
it it allows you to take a look at
anything like the businesses that are
happening in the world all around us it
helps you understand them if you want to
create a business this is the foundation
of every business plan that has or ever
will exist because each of these parts
is universal essential and fundamental
you have to answer these questions and
so by having this framework in your head
um going back to my friend earlier her
prep for the interview was very simple
we had a 15minute conversation about
what those things might look like she
went away and did her prep and she went
into the interview the next day and she
was offered the job and one of the
things that comes out of having this
deep understanding of business even for
potentially very young or very Junior
started understanding these things being
able to ask these questions being able
to know what's important and what's not
and think like an owner or an operator
of the
business is what the owners and
operators and Executives and managers
are looking for in terms of people to
hire people to recruit or people to
start companies and so the more you
understand how all of this works at a
deeply fundamental level the more
opportunities you're going to have I
think it's I think it's a skill That's
essential for every person to to know
and and be conversent
I think from the stats you said about
how the desire to sign up to a academic
MBA have increased most people would
agree true because you know that's a
reflection of demand in the market
you're saying more and more people are
going to University and trying to do a business
business
course are they being scammed because if
you think about the promise they're
signing up to even through the lens that
you've just described they're being
marketed something sure is that
institution delivering the value that
they're being marketed I.E I guess the
the promise is that you'll have a better
career you'll earn more money if I go to
university and do a business degree is
that being
delivered the answer to that is it
depends and the it depends is it depends
on what you want for yourself and your
life and so um approximately 2third of
business school graduates um go into
either management consulting or Investment
Investment
Banking um the remainder of them the
vast majority go into working for
extremely large companies and so if you
want your life to look like that then
the promise that is is very often
delivered but with business business
school programs is you're essentially
buying yourself a very expensive
interview to have an opportunity at a
company or a firm or an industry where
that is the primary mode of of um um of
getting into it
now the price of that interview can be
very very Steep and so um the the top 10
Business Schools um as we're talking
right now charge anywhere between $240 and
and
$250,000 for a two-year
program that's an enormous amount of
money and that's usually financed with
debt and so if you don't have a a for
example if you're not working for a
company that is willing to sponsor your
way through and pay the tuition costs
most of these degrees are are financed
with debt and that debt is going to be
with you regardless of whether or not
you like your career
regardless of the the economic situation
that you you graduate into regardless
whether or not you get a job at at the
end of it
so you're taking on an enormous OB an
enormous obligation spending a lot of
money borrowing a lot of money with a
very unsure outcome at the end is there
any correlation between getting an MBA
and long-term Career Success uh it it's
funny uh this has been asked by very
many people and the answer is always no
um so my my two favorite studies here um
Jeffrey feffer and Christina Fong at
Stanford University at the time this was
the early 2000s business school
professors did a study of do business
school programs work because if they did
you would expect to see more successful Executives
Executives
professionals having business school
degrees and what they found is no it
makes absolutely no difference and my my
favorite quote um was was by the lead
offer um Jeffrey feffer was like if you
are good enough to get in you are good
enough to do well
regardless it's a credentialing system
it's it's a pre selection um but really
like the people who make things happen
in business are people individuals with
skills and abilities and the abil the
the the Curiosity and the drive to to
make things happen you don't necessarily
get that from having three letters after
the end of your name there's going to be
so many people that are listening that
want to start their own businesses
they're probably currently in a
corporate job right now and they're
thinking gosh I have this idea I'd love
to give it a go but something is holding
them in place and from reading your book
it's it's the first thing that tends to
hold people in place is just their
belief that business is complicated yeah
um from everything you've come to learn
and all the testimonials you've had do
you agree with that belief that business
is complicated and or how difficult do
you think it is for the average person
with an idea to go from working in a job
to earning I don't know $10,000 a month
running their own business do you think
that's achievable for most people I
think it is achievable for most people
yeah and I I think uh um I think
business is complex in the sense of
there are many moving Parts it's not
just one thing they're interr
relatednesses that you need to
understand it's not complicated in the
sense of the most important ideas
principles things to do things to
understand are not all that difficult
when it get gets down to it um I think
in business in general um somewhat for
status related reasons but business
people like to feel fancy and
complicated and and sometimes you signal
status or sophistication by making
things sound really big or difficult or
or complex I think that's fundamentally
not the case for business most of the
ideas that we deal with are common sense
and simple
arithmetic and
so we do need to Grapple with the
complexities of the world because as we
were talking earlier the every business
has these five major interrelated parts
we need to understand how those work um
businesses are created by people for the
benefit of other people and so we need
to understand human psychology both our
psychology and the psychology of the
people we inter interact with relate to
whether that's customers or employees
contractors the other people in our
world and then there are certain parts
about how the world Works system and
process how things tend to interact with
each other that's very valuable and
important to know um but
again complex not complicated and I
think there's there's a lot of for for
the person who wants to
start a new business a lot of it comes
down to answering those fundamental
questions how are you going to create
value that someone else in the world
wants or needs okay so let's start so
typically when I do these podcasts I I
try and navigate The Journey right I try
and figure out where to start but this
is going to be the first time I actually
ask you if I am that person who has an
idea in my head um or maybe I've got you
know I'm off to the races with an idea
I've got a I don't know I'm going to
launch a business that sells
candles okay sure I think I can make
candles that smell amazing so what's the
first of those sort of levers or
principles I need to think about when
I'm when I'm designing my business
thinking about my business you know
thinking about making a business plan
what is step one in that Journey yeah
Step One is is the value creation
component which is it it sounds like in
in this particular example the candles
are the the type of value that that
would be created and then the the
relevant question there
is why do people buy candles what are
they looking for when when somebody goes
goes out and they say you know what I
would really like to have a candle right now
now
what do they want what do they need what
are they looking for they want them to
smell nice exactly okay so perfect they
want them to look nice yeah um they want
them to not be a ripoff so they want
them to be cheap guessing they want them
to last a long time I guess sure y last
a long time okay and so this is a a
really interesting thing a lot of the
things around value creation comes come
down to making trade-offs between
competing priorities and
so the perfect product or the perfect
offering would deliver every single
thing that the the customer would like
and it would be free yeah and so a lot
of the the early stage value creation
process is like okay we've identified
some some areas like things that people
are looking for things that people
want can you understand each of those
things in detail around for example what
makes a really good candle set what
makes a candle last longer what allow
Kingdom manufacturing at at a relatively
inexpensive rate all of those things and
then most successful businesses pick one
or two of those things to focus on and
then turn that dial all the way up to 9
10 11 and so for example you might be
able to make the best smelling longest
lasting candle using some complex
chemistry manufacturing process whatever
mhm that might be very expensive to do
so the price of the candle might be
higher than you than you otherwise uh
would like it to be um or you could go
the other direction let's make the
cheapest most ubiquitous candles ever
but then let's focus on the distribution
end of things to have candles in more
places and so you start um this was
something that that I learned how to do
very early in in my career I worked for
a consumer goods manufacturer big
company called Proctor and Gamble who
make everything by the way if people
don't know what Pro everything they
literally they're probably 10 things in
this room that Proctor and Gamble made
yeah toothpaste laundry detergent you
know all of that I I worked on the home
side and one of the things that I took
away was uh every once in a while you'll
you'll read in like the The Wall Street
Journal New York Times whatever about
the the crazy lengths that consumer
goods researchers will will go to to
figure out how people use like paper
towels or something like that I got to
be one of those people for a couple
years and it was
fascinating I've watched so many people
clean their
kitchens and there's there's a certain
amount of like the value creation
process that that is psychology and
anthropology of just going out into the
world with your eyes wide open noticing
what people do asking questions noticing
subtle things that they might not even
pick pick up
on and then if you do more formal
research you can start asking people to
to make explicit trade-offs between
options and so if you could have a
candle that lasted the long time versus
had the most amazing scent throw ever
which one would you pick and you can
start to to kind of navigate the space
of possible solutions in that particular
category by talking to people who buy
candles because you don't want to ask a
random person on the street you want to
talk to people who will actually
purchase the things that that uh that
you're creating
but by paying attention and by asking
questions and starting to to get a feel for
for
how the people who are making these
buying decisions actually navigate the
process of narrowing down options to
make a decision that's where you find
some sometimes the very tiny things that
make an enormous difference that's where
you find the places to innovate right
yeah but people don't know what they
want right so you got to be careful
because if you give people a survey on
candles exactly
they might tell you something but they
might buy you know there's this sort of
Detachment between what we think we want
and how we spend our money totally which
can cause people you know because I'm on
Dragon's St so people I'm halfway
through filming at the moment so I've
had 50 pictures so far and one of the
most popular phrases I hear as a dragon
on Dragon s which is the like shark tank
in the US and around the world is I have
this idea my friends and my M my mom
have told me it's great and they they'
definitely buy one and here it is and
and I go that means [ __ ] nothing
means absolutely nothing yeah and a lot
of people pursue ideas they quit their
career they spend years pursuing this
thing that their seven best friends and
their mom said they would buy and they
you know they gave it to their their
friend and their mom and their friend
and mom used it and said they liked it
yeah the best way to get around that ask
for early pre-orders ask people to lay
down money on the idea so um this I mean
this is part of how Kickstarter started
right here's an idea here's a concept
here's exactly what you're going to get
please enter your credit card details
because it's that act it's the raising
your hand wallet checkbook credit card
and saying yes I'll take one that's the
signal that you're looking forward for
and that can be everything from you know
Kickstarter on the consumer side to
letters of intent on on the the mid to
large size company side yes if you build
this Software System we will sign up for
an engagement at X price for X term um
so finding that buy buying signal is
really important and then going back to
to your comment earlier about um
noticing the the subtle
things people's behavior says a lot more
than people's words and so if you if
there's a conflict between what people
are saying and what people are doing
focus on what they're doing all the time
um one of my favorite uh stories coming
out of the the um consumer research
department at Proctor and Gamble was
there was a researcher in in a a lady's
home one afternoon and they were just
watching her do her laundry this was
this was back in the days of powdered
laundry detergent so you know you have
the box of powder you have the scoop put
it in and so the uh the lady turned on
her her
washer and just stood there for like 15
20 seconds doing nothing just like
waiting and the research just watching
and then at a certain point she's
like what what are you doing she's like
oh I'm I'm waiting for the tub to fill
up why are you doing that it's like well
if there's not water in the bottom when
I put the powdered laundry detergent in
it's not it's not going to dissolve
properly so you've got to wait for the
tub to fill up a little bit and then
then you put the powder in and you swish
it around the the bottom of the Basin
with your hand so it dissolves all the
way and then you put the clothes
in and so the researcher took this back
to the um to the research department and
all the chemists are just like this is
dumb we have science we have data that
says no our our detergent dissolves
completely this is not this is a
nonissue and the consumer researchers
are like no this is a psychological need
there's a bit of reassurance here that
people don't have how can we give that
to them and the answer to that was the
invention of liquid laundry detergent
which is now a multi-billion dollar a
year product category and it didn't come
from a physical need it came from an
unmet psychological
need and I just love that because I
remember remember growing up um watching
my grandmother do laundry and she did
the exact same thing for the exact same
reasons and it's sometimes those subtle
things so for example going back to our
candles um one of the things that uh
just by pure coincidence I was involved
in uh when I when I worked at PNG uh was
scent research so the scent of the
cleaning product like there's there's a
lot of psychology there's a lot of
science um that that goes into that
that
and there's a difference in how
something smells for example when you
take a cap off of a bottle of something
and sniff it smells different than if
you for example a cleaning product you
pour it into a bucket and dilute it with
water and you mop your
floor and
so those things make an enormous
difference like how is the product going
to be used and in the case of candles
one of the things that people pay very
close attention to is the smell of a
candle while it's
burning and the smell of a candle when
it's not
burning and there's a whole category of
candle purchasers who will buy a candle
based on what's called cold throw how
much does it smell when it's just
sitting on the middle of your table not
burning not doing anything and so those
are the the little bits like if you pay
close enough attention if you focus on
the right things the the the subtle
things that people are either saying or
not saying you can find those very
important unmet needs and then focus on
on meeting those and that's that's the
making of of a a product or an offer
that that has likes to it so interesting
because um we all walk around that thing
you were saying about the powed laudry
deterant that was 100% me I was too
young to be messing around with the
washing machine but whenever I had like
my shot my parents were out I'd pour all
the powder in into the little tray and
then I would like swish it around with
my finger I'd get water from the sink
above and pour it in there to try and
dissolve the powder with my finger so I
was doing that as well and I was
thinking as you you you were saying that
you know we all walk around with the
same kind of set of psychological biases
so if we assume that we can truly
understand how other people are behaving
when we are other people when we are
them as well when we have the same sort of
of
psychology assuming that we can guess
that is quite dumb because none of us
would have ever guessed what you just
said about the laundry detergent thing
none of us would have ever sat in a
boardroom and figured that out we had to
go out into the world and almost become
like a fly on the wall or take a bird's
eye view on how we as humans are
behaving to spot that opportunity right
and and I was thinking you know there's
so many people that are maybe have
business ideas now
um or thinking of a business idea but
but there's just just gaping opportunity
in observing the world objectively and
seeing how people are doing what they're
doing and why they're doing what they're
doing um I always wonder that I think
you know if you're trying to think of a
new business idea should you sit down
with a piece of paper and sketch out the
problems that you've had in your life
should you just start to become more
aware of your day-to-day life and then
make notes in your journal or is there
another way to find that idea yes start
there for sure
yeah and then go out into the world with
your eyes open just looking for problems
annoyances frictions um things that are
just a little bit annoying or suboptimal
in some way I mean I I think kind of a
general a general question like we're
not humanity is not running out of
problems to solve the there are millions
of opportunities to make someone's life
a little bit more pleasant a little bit
more secure a little bit bit more
interesting a little bit more fun and so
I think there's there's a lot of magic
to be had in just going out into the
world and having experiences in the
world with other people and just
noticing in a way that you've never
noticed before of oh there's something
there that's that's a little bit higher
friction than it otherwise could be I
mean this this was kind of the the
Genesis of um like Amazon Amazon Prime
how can we make it as easy as possible
for someone to click a button and
something magically arrives on your
doorstep within 24 to 48 hours how can
we make just just this opportunity a
little bit more fun or different or
interesting um this is this is where
like um over the past 20 years and
consumer goods packaging design has come
come a long way because if you can grab
someone's attention and give them a
little bit of a pleasant experience
while they're they're walking around
shopping that's a good thing it it moves
an enormous amount of product and it's
something that you have to plan for from
the very beginning stages but it makes a
huge difference it's so interesting cuz
I was just thinking as you're saying
that I was thinking what is an annoyance
or a frustration that I've just I just
live with that I've kind of just assumed
is the way of the world and it's just
the way it is and one sprung to mind
that's very close to home in every sense
of the word we've been doing this
podcast a long time a couple of years
now three four years now and every
single time before we start the podcast
Jack will walk in and Jack will say to
the guest please don't bang on the table
because if you bang on the table it
comes through the
mic we've been saying it for years we
haven't figured out how to solve the
problem yet so if there's anybody out
there but I was thinking do you know
what what an entrepreneur would do um if
there was any in this [ __ ] room um we
would we would make our own mic we would
solve the problem we could we could
probably solve but we kind of just
assume that someone else will solve it
or it's just the way of the world and I
say this because we could have probably
fixed this we've been very busy but we
could have probably
made a new mic with a new Bas that
suspends the mic so the vibrations don't
go through but I say this because
everybody in their lives has those
frustrations absolutely things they're
just living with and they they're kind
of assuming that someone else is going
to solve it or it's just the way the
world is
yeah what's sorry Jack we can't hear you
Jack Jack's defending himself from the corner
corner sure
sure
yeah yeah it's difficult with sm7 BS but
uh no there's a company called reot that
makes some really amazing universal
shock mount adapters for microphone I
think we should I think we should do it
and we should sell
it we'll have a meeting about that later
are you gon to go get it yeah totally
are you gon to go get it oh it's in there
there
okay no I was thinking God why didn't we
just make one okay so Jack tried to make
this contraption here oh cool which
would I guess suspend the microphone and
limit the vibrations going through it
yeah okay but we tried it and it didn't
work now now we're very busy with lots
of solving other issues so this was kind
of low on the list of priorities but
that as an example and everybody
listening to this now has daytoday
frustrations things they observe and go
that could be better sure and they go I
hope someone else figures that out yes
and that's the entrepreneur that's going
to make the millions yeah and and the
the difference between um entrepreneurs
and non entrepreneurs is the
entrepreneur says and I'm going to be
the one that solves that problem and
then what happens it depends on the idea
so for example like manufacturing idea
like this is this is where we start
getting into the different types of
businesses whether you're you're
building a product or building a service
um some sort of shared resource
membership um I I talk about 12
different forms of value in the personal
MBA so the instantiation of the idea
really depends on the form of which the
you're you're going to deliver it to to
the end result but like a lot of times
the early stages are prototyping finding
people who might benefit from this thing
getting their input advice perspective
and that gives you the information that
you need to either continue going down
that path or sometimes the information
is yeah this is a this is something that
could potentially be a really good idea
um but is is not going to be a viable
business for for whatever reason and so
some of those early stages of
Entrepreneurship are very focused on
what is this how might it work can we
sketch it out in enough detail to know
what questions we need to answer next in
order to figure out like what are the
critical assumptions can we meet those
critical assumptions to make a viable
business if so yes let's move on to the
next up if not let's discard it and go
on to the next so when we think about
this microphone challenge we've had one
of the critical assumptions we're making
is that it can be solved sure is that
there's some way to kind of insulate the
microphone from the vibrations of the
table at some point as those vibrations
travel up and I can see in this quite
cool Contraption actually we've used
rubber here yeah assuming that if we
suspend it with rubber there I'm
guessing this is Jack's invention I
guess it's your or someone else's is it
your invention
yeah it's a cool idea it now um that's
an assumption we've
made I'm guessing it failed it failed
the
okay yes okay so these are the
assumptions you're talking about yes and
and there's also um in this specific
example it's something that will serve
the need with this particular microphone
and so for example you might be able to
solve the problem in a very
straightforward Way by changing to a
different microphone that has different
options available so a lot of it just
depends on the constraints that you're
dealing with and this is the early
stages of figuring out how to give value
to the end consumer this is the sort of
iterative experimental failure ridden
process yes which everyone has to go
through and I think this is important to
highlight because what often will happen
is people will take the first pop at it
I know we've been doing we've been
taking many pops but just for the sake
of this conversation they'll take the
first pop at it it won't work then
they'll concede uhhuh yep when it's and
a lot of it comes down
to how big is this problem how urgent is
it how many people need something like
this um so this is where you get into
like the you know St this The Standard
supply and demand sort of economic
consideration is this a need that only
you have or is this a need that many
many people have and how how big of a
need is this is this something that for
example um high-profile podcasters will
pay thousands of dollars to solve or is
this something that affects only a Subs
segment of people and is not valuable
enough to to bother with or to invest a
lot of time and energy researching
finding a a solution for how do we how
do you find out if there's a big enough
market for your idea that's where you
that's where you talk to people and
that's that's the this is where value
creation and marketing tend to intersect
and so it's can you identify people out
in the world who have a very
similar problem set of things that
they're think thinking about set of
questions that they're trying to answer
and the more of those people you can
identify and the more urgent and
pressing the need is
um that's the first thing that you need
to to look for in terms of of
identifying viable markets so they tell
me that they want it I go out there I
speak to people they all tell me that
they want it but that's not enough right
ask them to place a pre-order that
that's that's the step two H okay so
it's it's not the question
isn't do you want it is it's is this
enough of a problem for you to pay money
to solve it um um there's a a guy desk
trainer who who founded
intercom um has a saying I just love
he's like show me a credit card that has
been swiped to solve this problem and I
will concede that the problem is
real and so you're really looking for
like are people is this big enough
important enough are people spending
money to solve this particular need if
so that's a really great sign you're on
the right track okay so what I'm gonna
do then is we're going to before we
spend a lot of money in building out
this new microphone system we're going
to put up a waiting list for the
podcasters we're going to see how many
of them swipe to pre-order it yep and
then if we get I don't know a couple of
hundred a couple of thousand probably a
couple of hundred couple of hundred
swipes with their credit cards to
pre-order this thing even though we
haven't built it yet then we're going to
invest in building it yep does that make
sense it does and then you do a short
run to mitigate your risk first okay you
get your your uh initial Fe feedback
from your first run of customers they
will have opinions about what works and
what doesn't mhm and then um if that is
enough that's when you start like start
small and then you work up to to larger
and larger batches of production because
what's happening a lot out there with
aspiring entrepreneurs is they're
spending two to three years building
their company and it's all leading up to
this launch day where everything's
riding on this big launch day they've
raised I don't know $70,000 for their
whatever sure why is that the wrong
approach to take I think there's a difference
difference
between doing business and playing
business it's like people who get really
really excited of I'm going to start a
company and so the first thing I need to
do is pick a logo and buy my business
cards like that's the signaling parts of
business it's playing a role where the
actual doing of the business is the
value creation Marketing sales value
delivery finance and so the more you can
skip all the early stuff
get to the core of what is going to make
the business succeed or fail figure that
out as quickly as possible and then get
on with it then you're going to have
more than enough time and money to have
fancy business cards and like do do do
that bit but yeah it really is like at
the idea validation stage it's how can
you ask enough people who might be in
the market to spend money to solve this
particular problem how can you get
something valuable in front of them as
quickly as possible what would that look
like and how can you do that
particularly early on if you don't have
a lot of funding in a way that minimizes
time and finance because the worst
possible uh way to go about things is
raise millions of dollars of venture
capital and build up out this whole
thing only to have no one buy it at the
end you started with this point of value
giving value to other people why why is
that the the frame to think through when
you're thinking about the idea yeah I
think if you are not providing value to
other people in a fundamental way you
have no business
business
um a venture that markets and sells
something that does not deliver value to
other people is a scam and so really
like I think there's there's a way of
thinking about business this is one of
the things I find fascinating about it
business to me is is a generative act
you are going out into the world you're
finding a problem you're finding a
solution to that problem you're creating
something that makes the world better in
some fundamental
way and then you're bringing it to the
attention of people who care and you're
convincing them that they need to try
this to actually solve their problem and
then it works and then they give you
money for it it's great so you can just
keep that process going going for for as
long as as it makes sense to everyone
involved like I I think to me a well
running working business system is a
thing of beauty you're solving people's
problems you're being rewarded for it
you're doing it in a way that allows you
to keep solving people's problems and it
makes your life better in the process I
think that's a wonderful way to live
your life and if you don't start
by asking the question what is the
valuable thing that I am going to
deliver to people who care the whole
thing pulls apart what step two then
yeah marketing marketing okay marketing
is fun yeah marketing is is just who
might be interested in this
thing um
and a lot of it is the the the
fundamental thing is if no one knows you
exist no one's going to be able to buy
your thing and and so marketing is is
the process of attracting the attention
of people who might be interested in the
value that that you're creating and in
an Ideal World making them curious
wanting to learn more um asking for
additional information engaging with
what what it is that you have a lot of
people conf conflate Marketing in sales
to me they're distinct processes so so
marketing is the attracting attention
and generating interest and then sales
is the process of convincing someone to
buy and then getting them set up as as
as a
customer and a lot of marketing comes down
down
to what is it exactly that you're trying
to gather attention for and where do
those people generally hang out what are
they curious about what are they already
paying attention to what can you um what
can you take advantage of or dovetail
into in order to attract someone's
attention at the right moment at the
right time
and make them aware that you have
something that could benefit their life
here's what it is here's how you can
benefit from it to be great at marketing
do you think we need to understand the
underlying psychological sort of core
motivations of humans oh absolutely yeah
and you know what those are yeah um
there was a really great book about this
um published years ago called um drive
by Paul Lawrence and and noria um who I
think at the time was the um the dean of
Harvard Business
school and they argued that um humans
have four fundamental drives um and if I
can remember them off the top of my head
the drive to
acquire the drive to bond the drive to
learn and the drive to
defend is there a fifth the drive to
feel the drive to feel is is my addition
to to this okay so yeah and to me like
so the drive to acquire you know let's
go out and buy products in enhance my
career things like that the drive to
learn gather knowledge understand the
world um the drive to bond relationships uh
uh
experiences uh the drive to defend uh
let's protect myself home security
systems you know all all that thing and
for me like entertainment is very much a
a drive to
feel um we don't go to the movies to do
any of those previous four things we go
to the movies to have an experience to
feel motions and so I to me the vast
majority of offers in the
market are designed to to to hook into
or to take advantage of one of those
five core human drives and the more
drives that you you hook into generally
the more attractive the the business
offer is is going to be and so you could
make a a a pretty straightforward
argument that um one of the reasons that
soci media has become so popular over
the last decade is because it hooks into
at least four out of five of these
drives potentially all
five so give me an example of a business
and the drives that it's kind of playing
to in its marketing strategy so if we think
think
about Nike maybe sure yeah so um the the
drive to acquire is straightforward I
need to put things on my feet like shoes
are great um also it is status so so I
would say the the there can be like the
acquiring status drive there can also be
very much like ingroup outgroup Dynamics
are a form of bonding right I'm the type
of person who identify or who will wear
this sort of thing I form relationships
with people who care about these
sneakers these special additions these
athletes these whatever
um less learning less defending
feeling can very much be a part of of a
product experience like people who
strongly identify with certain brands
certain Lifestyles certain ways of of
being in the world like when you put on
something that makes you feel good there
can be an emotional component to that
experience that's very very strong it's
interesting because I was thinking about
Apple as well through that lens Apple's
a great example obviously so if we think
about the drive to acquire very much a
status project product and it always has
been Bond again most much of their
advertising is about connecting people
in connection learn again you know much
of their marketing is about the fact
that you can learn on these devices like
the iPad for example defend they talk
about how encryption a lot and huge
focus on security and privacy right now
for that reason yeah the drive to feel I
guess most of their marketing when I
think about the Vision Pro where they
weirdly show like the dad and his kids
and he's got this massive headset on I
guess that was an attempt to arouse em
The Vision Pro now has this sort of
spatial video where you can you know one
of my team members when they first put
it on for the first time remarked that
they wish they had got spatial videos of
their grandmother that's passed away
because but that's the kind of narrative
that they show with the products as well
is that it's going to they really put at
the heart in the the marketing
initiatives they do so they really do a
really good job at hitting all of these
yeah I I would say do you remember the
early iPod advertisements with like the
white silhouette person dancing on a Col
those advertisements were
straightforward feeling
a thousand songs in your pocket it's how
the songs make you feel this is a way
that you can feel that more often or
more strongly it's pure
emotion and they specifically you know
so a more like straightforward drive to
acquire on a technology product is is
like how many gigabytes of storage does
this thing
have and they talked about they made a
deliberate decision not to talk about
that at all because it didn't matter
people didn't care it was all about
here's how you can feel through the
experience of using this product to have
an experience you wouldn't otherwise
have I mean this highlights a really
important point about marketing but
building products and deciding what to
build which is how important is it to
make something that is logically better
versus something that is emotionally
more compelling yeah in an Ideal World
you do both um you can go a long long
way with
emotion even when you don't have um straightforward
straightforward
Superior product benefits you know going
going back to uh our our discussion of
candles earlier candles have been around
for what hundreds of years like you're
probably not going to to make you know
barring Material Science advancements
you're probably not going to make a a a
technical contribution to Candle science
in the process of making something speak for
for
yourself I mean it's possible it's my
next business IDE I told you yeah um but like
like
things like the packaging and the
marketing and the scent and the unboxing
experience and the anticipation of
putting it out as as the centerpiece
when all your friends come and all of
that like there are so many emotional
hooks to that sort of
experience that you could argue that
candles are sold
almost all on emotion and that's great
that's the value that's being delivered
do you know a better example of that
I've came across recently liquid death
oh yeah it's just
water what yes they built a billion doll
business selling water in a fancy can
totally and affiliation like there's a
little bit of a bonding or I'm the type
of person who wants to present to the
world in this particular way so I don't
buy Fiji I buy liquid
death sure it's just water it's just
water sometimes it's carbonated or
flavored yeah come on it's water I I saw
some I thought these stats might be out
of date but it was maybe last year the
the year before I saw that they were
selling half a billion dollars of water
and they're like a fairly new market
entrance in the grand scheme of things
and and from what I can observe it's
just a different can yeah and the
packaging matters the affiliation
matters the story matters why do you
think they won I think they were first
so that's also
um you talk about in your book the value
of doing something big and crazy for the
value of doing something big and crazy I
mean they were the first to do something
crazy on the marketing side for water it
was a really boring product category
very straightforward very functional um
and what their big Insight was the way
that we talk about it the way we package
it the way we present it matters and
there's a certain Subs segment of
customers that would not buy a
straightforward bottle of water because
they don't care but if they can signal
something about themselves or a group
affiliation in in some way shape or form
through the packaging of the product
then then to a certain subse of
customers that's valuable I've been
thinking about this theory for a while
last couple of months maybe six months
now that Brands need to especially New
Market entrance in saturated busy
markets like if you're coming out with
an energy drink right now or you're
coming out with a can of water you the
easiest way to market in terms of
marketing is if you you do a really good
job of making it clear that you are the
antithesis of the incumbents yes so you
are a or not an and in your customers's
decision framework for and what I mean
by that is to be very specific um I've
invested in a company called perfect Ted
it's actually the drink in my cup right
now and when in one of my first meetings
with them um when we sat down I said you
know this brand I think will win if the
consumer walks down that Supermarket
aisle and thinks to themselves
I can be a insert incumbent energy drink
brand mhm or a perfect Ted person I
can't possibly be both right and we all
know that well I think a liquid death
customer doesn't believe they can be a
EV and Water customer sure because that
it's so clearly they've stood for
something so much so that in doing so
they stand against
something and and this is what breakout
brands have done Brew dog is a good
example in the UK brw dog came into the
market Indie Punk beer they literally
took Carling beers and stuff like that
to Fields as part of their marketing and
blew it up with dynamite to say we are
not commoditized beer we are the
antithesis we are an awe you're either
with them or you're with us yep but that
takes guts it does it takes Bulls like
liquid death Bulls yeah yeah and there's
there's a whole like on the
psychological side of things the the
studies about signaling and counter
signaling like this is this is how
fashion in in the the broad scale works
so all the cool people high status
fashionable people start wearing a thing
to Signal group affiliation of like we
are the type of people who wear this
yeah and then very quickly you have
follow on folks who like oh the cool
people are wearing this I should start
wearing this too and that happens a
couple Generations until that thing is
at marks and Spencer Target uh choose
your retailer and then
the people who want to distinguish
themselves for from all of the things
that are being sold the mass retailers
will change Fashions specifically to
signal that we are not that and so the
cycle begins
again and so that that's just like
social signaling is a rabbit hole that
you could spend decades going down and
not get to the end of it but it's all
about who am I presenting myself to be
in the world who do I affiliate with who
do I not affiliate with and counter
signaling is noticing a signal that's
happening out there there in the world
and making a deliberate decision to be
the opposite of that or the the the
antithesis of that in some ways
and that is such a fascinating part of human
human
psychology that
um generally speaking if you can so you
could say like um Apple did a lot of
counter signaling because Microsoft you
know some of the incumbent manufacturers
was their uh their famous uh 1984
advertisement was almost pure counter
signaling it was almost pure
emotion and it set them up as the polar
opposite to faceless beig computer box
Corporation and so yeah like if if
there's something that is is the
prevailing Trend in a certain industry
it can often pay to you know in in the
anthropological sense take a step back
notice what's going on here's the signal
that's being sent and then make a
deliberate decision to be the polar
opposite of that it takes guts though
because there's no blueprint for the
opposite yeah and you stand out yeah
which is great you get attacked yeah I
mean that's the the benefit of
controversy too so controversy can be a
wonderful marketing tactic if you use it
responsibly responsibly and so you know
you don't necessarily want to turn your
business into a soap opera but by um by
deliberately courting a certain amount
of controversy focused on the benefits
or the features you can attract a lot of
attention that way and that's what I
mean by the brewog example where they
took beer to their competitiv beer to a
field and blew it up with dynamite sure
and said we are not commoditized beer
they got they got destroyed they got
attacked so so much but the the
controversy is energy and it's making
people make a decision exactly and that
results in what is what became a
multi-billion dollar Indie beer brand
with a fraction of the marketing budget
but also that had been around a fraction
of the time versus the incumbents really
interesting Jane warring was on the
podcast she's the founder of dermologica
and she said the same thing to me she
said you know she's Built This Global
Beauty brand she goes we need to piss
off the 80% to get to the the 20% she go
we don't need everybody to like us
that's not a brand exactly a brand makes
you feel something y um but most people
that are struggling right now with
marketing I think much of the reason
they are struggling is because they are
vanilla wallpaper yeah I mean this going
back to our new product development
conversation that's what a lot of people
struggle with too because they have
their first conversation with somebody
who's like oh I hate that it's GNA work
for me it's like oh no yeah what am I
doing wrong how can I fix this it's like
no no no no you don't need all the
people you need the tiny fraction who
care more than everyone else M and a
certain like a certain amount of
polarization is a very very good thing
because it means that the thing that
you're doing is distinctive enough like
the people who care really care they
really love it they're going to buy it
consistently buy it often the people who
don't care might be completely apathetic
to the category you might not ever spend
a million dollars in 10 years you might
not ever be able to get them to care and
so your job is at a market marketer is
to attract the attention of all of the
hyper responders the people who care a
lot care often and like are really into
it and then all of the people who don't
care and are never going to Care they
can go away and that's fine if I wanted
to be an exceptional
marketeer if I wanted to you know I've
got a product and idea and I want to
make sure that it penetrates a very
noisy online Market but even an IRL
Market what would you um what kind of
skills and principles or first
principles should I really be thinking
about to become a great marketeer
because you know we can get carried away
with the fish and what I mean by the
fish is tactics and strategies but what
is the fishing rod what is the the
mindset the principles that are going to
make me a great marketeer for the next
30 40 years regardless of change yes
fundamentals of human attention that
comes down to psychology so so the vast
majority of people moving through their
lives are busy stressed overwhelmed
already have too too much information
bombarding them from all uh all points
at all times and so figuring
out I think this is a story you tell in
your book actually so so Jenny on the
side of the road who who's who's broken
down having the worst day of her entire
life um it's a little bit hyperbole but
it's it's true like most of us are just
wildly oversubscribed in in terms of
attention and time and energy and so
figuring out the little bits
of being able to to highlight the thing that's most important most interesting
that's most important most interesting most valuable upfront quickly in a way
most valuable upfront quickly in a way that cuts through that is the primary
that cuts through that is the primary skill of
skill of marketing
marketing and a lot of the the other particulars
and a lot of the the other particulars the tactics the strategies are very
the tactics the strategies are very dependent on what Market are you
dependent on what Market are you operating in what scale are you
operating in what scale are you operating at like all of that stuff but
operating at like all of that stuff but fundamentally understanding that people
fundamentally understanding that people are busy and starved for time and
are busy and starved for time and attention how can you grab it and what
attention how can you grab it and what can you do to keep it um that's the
can you do to keep it um that's the primary skill of marketing by far so if
primary skill of marketing by far so if I'm if I'm running that if I'm thinking
I'm if I'm running that if I'm thinking about starting my candle business what
about starting my candle business what is step three in your sort of I think
is step three in your sort of I think you said five-step framework of what
you said five-step framework of what really matters sure yeah this is sales
really matters sure yeah this is sales okay sales and so for a candle business
okay sales and so for a candle business this might look like direct sales online
this might look like direct sales online it could also look like intermediate
it could also look like intermediate intermediatory sales like through a
intermediatory sales like through a distributor and
distributor and so it's funny like value creation
so it's funny like value creation marketing value delivery and finance all
marketing value delivery and finance all of those are the processes where uh
of those are the processes where uh where money is Flowing out of the
where money is Flowing out of the business you're spending money to do all
business you're spending money to do all of this analysis uh sales is the part
of this analysis uh sales is the part where money comes in which makes it
where money comes in which makes it makes it particularly important and so
makes it particularly important and so some of the early decisions around sales
some of the early decisions around sales are um how are you going to ask for the
are um how are you going to ask for the sale what does the sales process look
sale what does the sales process look like and are you dealing directly with
like and are you dealing directly with the customer that who is purchasing from
the customer that who is purchasing from you or are you dealing with some sort
you or are you dealing with some sort sort of independent third party or
sort of independent third party or sometimes multiple third parties in the
sometimes multiple third parties in the process like a retail or distributor
process like a retail or distributor exactly okay and in order to be
exactly okay and in order to be exceptional at selling my
exceptional at selling my candles is there anything that I should
candles is there anything that I should bear in mind maybe when I'm making the
bear in mind maybe when I'm making the candles how I'm packaging the candles
candles how I'm packaging the candles the way that I'm you know going to those
the way that I'm you know going to those retailers or yeah so I think
retailers or yeah so I think um there's a part
um there's a part of because sales is kind of in the
of because sales is kind of in the middle the process there's a part of
middle the process there's a part of sales that intersects with marketing in
sales that intersects with marketing in the sense of you're trying to make this
the sense of you're trying to make this maximally appealing to get someone to
maximally appealing to get someone to give you money for it and so the
give you money for it and so the customer understanding how how can how
customer understanding how how can how can we be persuasive in getting someone
can we be persuasive in getting someone to say yes this is for me here's my
to say yes this is for me here's my money I would like one please there's
money I would like one please there's also a part of sales which is somewhat
also a part of sales which is somewhat neglected which intersects with the
neglected which intersects with the value delivery part of the process which
value delivery part of the process which is the point a sale is not just to get a
is the point a sale is not just to get a customer in an ideal way it's to get a
customer in an ideal way it's to get a happy satisfied customer someone who not
happy satisfied customer someone who not only purchased the thing that you bought
only purchased the thing that you bought but is happy with the thing that they
but is happy with the thing that they bought and is thrilled that they did
bought and is thrilled that they did business with you and is planning on
business with you and is planning on doing business with you again why is
doing business with you again why is that so important well it's relatively
that so important well it's relatively straightforward to make a sale once um
straightforward to make a sale once um usually the first sale is the most
usually the first sale is the most expensive and so generally a repeat C
expensive and so generally a repeat C repeat customers are the best customers
repeat customers are the best customers you will ever have they are already know
you will ever have they are already know you exist they already know your stuff
you exist they already know your stuff is great um you don't have to attract
is great um you don't have to attract their attention again necessarily um and
their attention again necessarily um and depending on what you're selling like
depending on what you're selling like those repeat customers can the lifetime
those repeat customers can the lifetime value of a repeat customer can be
value of a repeat customer can be extraordinary and so if you've already
extraordinary and so if you've already done the work to get a customer once
done the work to get a customer once then you should want to keep them happy
then you should want to keep them happy and keep them around for as long as
and keep them around for as long as humanly possible what's lifetime value
humanly possible what's lifetime value oh lifetime value this is this is a fun
oh lifetime value this is this is a fun one um so lifetime value is the sum
one um so lifetime value is the sum total of all sales of a customer with a
total of all sales of a customer with a business and so imagine um Jack I sell
business and so imagine um Jack I sell jack a candle
jack a candle yes
yes now Jack how many candles do you uh do
now Jack how many candles do you uh do you burn a
you burn a year seven seven okay so take the The
year seven seven okay so take the The Profit that you make per candle so I'm
Profit that you make per candle so I'm selling the candles at $10 and I make $1
selling the candles at $10 and I make $1 profit on them yep times s
profit on them yep times s okay so the lifetime value well let's
okay so the lifetime value well let's say we're just over the course of a year
say we're just over the course of a year $7 profit for let's take someone like
$7 profit for let's take someone like Jill who burns the candle every week wow
Jill who burns the candle every week wow and not just this year she Burns a
and not just this year she Burns a candle every week years and years and
candle every week years and years and years running so for Jill 52 time 7 is
years running so for Jill 52 time 7 is $364 and so she's a much more valuable
$364 and so she's a much more valuable customer than Jack is by a lot and so if
customer than Jack is by a lot and so if you had to to to make a choice between
you had to to to make a choice between Jack and Jill like you should choose
Jack and Jill like you should choose Jill every single time customer service
Jill every single time customer service matters right it does yeah because
matters right it does yeah because people many companies see it as like an
people many companies see it as like an annoyance like I've sold you the [ __ ]
annoyance like I've sold you the [ __ ] thing why you email me stop bothering me
thing why you email me stop bothering me and they treat you like you're a
and they treat you like you're a nuisance yeah yeah and that's a shame um
nuisance yeah yeah and that's a shame um because really like those happy repeat
because really like those happy repeat customers
customers are not just like your high lifetime
are not just like your high lifetime value customers the customers that will
value customers the customers that will stick with you keep spending money with
stick with you keep spending money with you they're also a primary source of
you they're also a primary source of marketing like Word of Mouth marketing
marketing like Word of Mouth marketing is all happy customers telling other
is all happy customers telling other people who might benefit from your
people who might benefit from your product that hey here's this wonderful
product that hey here's this wonderful thing you should probably check it out
thing you should probably check it out and so yeah like things like post Sal
and so yeah like things like post Sal support um sometimes customer
support um sometimes customer reactivation so like to your point
reactivation so like to your point earlier it's a very straightforward
earlier it's a very straightforward marketing technique called
marketing technique called reactivation if you can contact Jack and
reactivation if you can contact Jack and say Hey you bought candles from us last
say Hey you bought candles from us last year would you like to buy candles from
year would you like to buy candles from us this year and get him to to pick up
us this year and get him to to pick up just a couple more more candles like the
just a couple more more candles like the cost of that promotion is potentially
cost of that promotion is potentially very small you already know he exists
very small you already know he exists you already know that he's purchased um
you already know that he's purchased um can you just get him to do that again um
can you just get him to do that again um those are some of the most effective
those are some of the most effective Marketing sales campaigns that you can
Marketing sales campaigns that you can possibly run but it also requires that
possibly run but it also requires that they had a good experience with whatever
they had a good experience with whatever it is that you're offering in the first
it is that you're offering in the first place is there like a sales equation of
place is there like a sales equation of sorts is there like a you know when I'm
sorts is there like a you know when I'm thinking about how to close a deal how
thinking about how to close a deal how to sell that candle is there a skill set
to sell that candle is there a skill set or a framework or a model that I should
or a framework or a model that I should be thinking through when I'm trying to
be thinking through when I'm trying to sell it to Jack or Jill um there are
sell it to Jack or Jill um there are many many Frameworks I think the um the
many many Frameworks I think the um the biggest most most popular one uh which a
biggest most most popular one uh which a lot of people get stuck on as the whole
lot of people get stuck on as the whole features versus benefits
features versus benefits conversation and so
conversation and so um in the context of candles Fe a
um in the context of candles Fe a features conversation would be is this
features conversation would be is this candle is made from 100% soy wax people
candle is made from 100% soy wax people don't necessarily care it's not relevant
don't necessarily care it's not relevant to the reason that people purchase
to the reason that people purchase candles benefits are the things that
candles benefits are the things that people that get to those core human
people that get to those core human drives the things that that motivate the
drives the things that that motivate the purchase to begin with
purchase to begin with and
and so one very useful way of thinking about
so one very useful way of thinking about this is whenever you're doing any sort
this is whenever you're doing any sort of marketing or sales you're focusing on
of marketing or sales you're focusing on the benefits the things that you're
the benefits the things that you're delivering to people the things that are
delivering to people the things that are enticing and if you talk about features
enticing and if you talk about features at all you use them as reasons to
at all you use them as reasons to believe that you're going to be able to
believe that you're going to be able to deliver the benefits that are promised
deliver the benefits that are promised and so um if for example you're you're
and so um if for example you're you're uh taking an an ecologically friendly
uh taking an an ecologically friendly approach to your your candle business um
approach to your your candle business um the fact that 100% soy is very clean
the fact that 100% soy is very clean burning and environmentally friendly
burning and environmentally friendly might be a reason to believe that this
might be a reason to believe that this benefit is true but it's not the primary
benefit is true but it's not the primary reason that people are going to purchase
reason that people are going to purchase interesting and a lot of people I guess
interesting and a lot of people I guess are making the mistake of focusing on
are making the mistake of focusing on the features of their product yeah this
the features of their product yeah this is the the difference
is the the difference between um an iPod has one gigabyte High
between um an iPod has one gigabyte High Drive hard drive and a thousand songs in
Drive hard drive and a thousand songs in your pocket a thousand songs in your
your pocket a thousand songs in your pocket is a benefit the size of the hard
pocket is a benefit the size of the hard drive is the feature that enables that
drive is the feature that enables that and why why is it more powerful and
and why why is it more powerful and compelling to the customer to focus on
compelling to the customer to focus on the benefit versus the feature is there
the benefit versus the feature is there something in our neurology is that a
something in our neurology is that a word neurology it is a word is that the
word neurology it is a word is that the right context in our brain yeah well I
right context in our brain yeah well I think this this gets into um some Bier
think this this gets into um some Bier psychology things which is people
psychology things which is people generally before making a purchase
generally before making a purchase decision imagine what their life is
decision imagine what their life is going to look like if they go down this
going to look like if they go down this particular route if I buy this thing if
particular route if I buy this thing if I uh sign up for this service if I
I uh sign up for this service if I become a member at this club or gym or
become a member at this club or gym or or or whatever um there's there's a a
or or whatever um there's there's a a mental simulation process that very
mental simulation process that very often happens of like may maybe buying a
often happens of like may maybe buying a new car is a good tangible example of
new car is a good tangible example of this like before you buy the car you did
this like before you buy the car you did the test drive and you imagine like what
the test drive and you imagine like what my what would my life be like if I was
my what would my life be like if I was driving this every day if I pull this
driving this every day if I pull this into into my in my driveway where are
into into my in my driveway where are the neighbors
the neighbors gonna are they gonna look at me gonna
gonna are they gonna look at me gonna think I'm cool you know like there's
think I'm cool you know like there's there's this
there's this like with a little bit of information
like with a little bit of information our brains can kind of extrapolate or
our brains can kind of extrapolate or start to predict what is likely to
start to predict what is likely to happen out into the future to a certain
happen out into the future to a certain extent and this is you know to to to
extent and this is you know to to to some of the things you talk about in
some of the things you talk about in your book about storytelling this is why
your book about storytelling this is why stories work for marketing and sales it
stories work for marketing and sales it helps people engage that part of their
helps people engage that part of their brain that can that can simulate a
brain that can that can simulate a potential future that looks and feels
potential future that looks and feels really great and start to anticipate it
really great and start to anticipate it get excited about it
get excited about it and like when you're selling a car on
and like when you're selling a car on the sales side of the the
the sales side of the the Spectrum rule number one is get the
Spectrum rule number one is get the potential customer in the driver seat of
potential customer in the driver seat of that car as quickly as possible nothing
that car as quickly as possible nothing else matters
else matters you want them to engage in the process
you want them to engage in the process of driving and imagining as quickly as
of driving and imagining as quickly as possible because that that's when they
possible because that that's when they start to convince themselves that this
start to convince themselves that this is something that they might want to
is something that they might want to have in their life so anything that you
have in their life so anything that you can do to engage those kind of
can do to engage those kind of simulation prediction sort of of
simulation prediction sort of of processes the better if you were to try
processes the better if you were to try and pin down the very core parts of what
and pin down the very core parts of what makes a company
makes a company successful what are what is what are the
successful what are what is what are the core components of that what are the
core components of that what are the fundamental games at Play in business in
fundamental games at Play in business in your view yeah so there I think there
your view yeah so there I think there are a bunch of different ways to answer
are a bunch of different ways to answer that um we've talked a lot about the
that um we've talked a lot about the five parts of every business those are
five parts of every business those are the fundamentals of what the employees
the fundamentals of what the employees are actually doing MH um in general you
are actually doing MH um in general you want to hire people who
want to hire people who are curious
are curious engaged excellent
engaged excellent communicators and are signing up for
communicators and are signing up for whatever whatever it is the the the
whatever whatever it is the the the long-term objective Mission Vision of of
long-term objective Mission Vision of of the company here's what we're doing
the company here's what we're doing here's why it matters here's exactly who
here's why it matters here's exactly who we're serving here's why that matters
we're serving here's why that matters here's how we're going to go about doing
here's how we're going to go about doing that and from there everything that
that and from there everything that happens within the
happens within the company each of the employees are going
company each of the employees are going to be focused on one or more of these
to be focused on one or more of these five essential parts of the business in
five essential parts of the business in an ideal World they understand all five
an ideal World they understand all five and how they interrelate to each other
and how they interrelate to each other and
and how something that is done in one like
how something that is done in one like say the marketing end of side end of
say the marketing end of side end of things might really make a huge
things might really make a huge difference on the value delivery or
difference on the value delivery or customer service end of
customer service end of things if you have all of those pieces
things if you have all of those pieces in place then the question becomes how
in place then the question becomes how large does this business need to be in
large does this business need to be in order to serve its customers at to the
order to serve its customers at to the maximum possible extent in a long
maximum possible extent in a long long-term sustainable
long-term sustainable way and then what level of internal
way and then what level of internal organization makes the most sense so
organization makes the most sense so people can spend most of their time
people can spend most of their time doing work related to the five parts of
doing work related to the five parts of of every business and as little time as
of every business and as little time as possible managing the rest and so this
possible managing the rest and so this is kind of the the flip side of of some
is kind of the the flip side of of some of the common failure cases of
of the common failure cases of bureaucracy paperwork busy work all of
bureaucracy paperwork busy work all of these
these things what level of management do you
things what level of management do you need
need um how can you minimize that how can you
um how can you minimize that how can you make sure
make sure that um to me good management is is
that um to me good management is is helping remove barriers to people who
helping remove barriers to people who are doing skilled work how can you
are doing skilled work how can you remove as many things from their plate
remove as many things from their plate as possible so they can focus on the
as possible so they can focus on the parts of the business that are are
parts of the business that are are generating the most
generating the most value and
value and so there's a lot um I think this was the
so there's a lot um I think this was the founder of Southwest Airlines herp
founder of Southwest Airlines herp Keller it's like hire for attitude train
Keller it's like hire for attitude train for
for skill I think there's a lot to be said
skill I think there's a lot to be said for that because because I'm thinking a
for that because because I'm thinking a lot about that person who is you know
lot about that person who is you know again they're starting their candle
again they're starting their candle business and they're trying to figure
business and they're trying to figure out what this game of business
out what this game of business fundamentally comes down to in 10 years
fundamentally comes down to in 10 years from now is it how smart I am is it how
from now is it how smart I am is it how good I am at assembling a group of smart
good I am at assembling a group of smart people is it culture is it the vision I
people is it culture is it the vision I set is it the product I build is it all
set is it the product I build is it all of these things but if we just start
of these things but if we just start with hiring then because this is in my
with hiring then because this is in my experience where people often succeed
experience where people often succeed and fail and often where a lot of their
and fail and often where a lot of their biases show up that they don't even know
biases show up that they don't even know about sure um how important is
about sure um how important is hiring to building a great business and
hiring to building a great business and becoming a successful
becoming a successful entrepreneur complicated answer to that
entrepreneur complicated answer to that okay so
okay so it can be more or less important
it can be more or less important depending on exactly what you're
depending on exactly what you're offering I'm offering candles you're
offering I'm offering candles you're offering candles yeah so so to me
offering candles yeah so so to me like making some assumptions if you're
like making some assumptions if you're handling if you're selling candles
handling if you're selling candles Direct on the internet with a small
Direct on the internet with a small distribution center and mostly online
distribution center and mostly online advertising your team is probably going
advertising your team is probably going to be relatively small and that can be a
to be relatively small and that can be a really good thing if you're selling
really good thing if you're selling candles in distribution and tooling up a
candles in distribution and tooling up a manufacturing line and uh and going off
manufacturing line and uh and going off and and calling on all these large
and and calling on all these large customers and potentially producing Mass
customers and potentially producing Mass Market candles it's a very different
Market candles it's a very different business operation and so there's a lot
business operation and so there's a lot of
of like understanding the necessities of
like understanding the necessities of the game that you're playing and then
the game that you're playing and then matching your hiring exactly to what
matching your hiring exactly to what those needs are but not more I think
those needs are but not more I think about um when I was thinking about this
about um when I was thinking about this candle business that I'm hypothetically
candle business that I'm hypothetically going to launch one of the things that
going to launch one of the things that might stop me from launching a candle
might stop me from launching a candle business as it does for many people is
business as it does for many people is that there are already lots of [ __ ]
that there are already lots of [ __ ] candles and in every industry you know
candles and in every industry you know when I hear entrepreneurs or I hear sof
when I hear entrepreneurs or I hear sof preneurs which is someone who's got an
preneurs which is someone who's got an idea on the sofa one of the reasons
idea on the sofa one of the reasons they'll give as to why they've not
they'll give as to why they've not started the business is because they've
started the business is because they've just they've done some market research
just they've done some market research and they've discovered there is already
and they've discovered there is already someone solving that problem uhhuh and
someone solving that problem uhhuh and then they go no there's no there's no
then they go no there's no there's no money to be made there what role does
money to be made there what role does competition play in this whole pitch
competition play in this whole pitch is competition a bad thing a good thing
is competition a bad thing a good thing a signal that I shouldn't yeah there's
a signal that I shouldn't yeah there's something really fun here um I talk
something really fun here um I talk about it in the book I call the iron law
about it in the book I call the iron law of the
of the market which is um a way of saying that
market which is um a way of saying that markets that don't exist don't care how
markets that don't exist don't care how smart you are it was a mark andreon
smart you are it was a mark andreon quote from way back in his Netscape
quote from way back in his Netscape days and it's the whole idea like it's
days and it's the whole idea like it's actually a really good thing that there
actually a really good thing that there are a bunch of people selling candles in
are a bunch of people selling candles in the market because that means that
the market because that means that there's a large Market of people who are
there's a large Market of people who are willing and able to buy candles it
willing and able to buy candles it validates the the the need it validates
validates the the the need it validates the existence of the market in the first
the existence of the market in the first place the markets you need to be really
place the markets you need to be really careful about are the brand new to the
careful about are the brand new to the nobody has ever seen anything like this
nobody has ever seen anything like this on the face of the Earth because not
on the face of the Earth because not only do you need to educate and convince
only do you need to educate and convince people you have no idea whether people
people you have no idea whether people have will purchase this thing that
have will purchase this thing that you've made this is a story a story that
you've made this is a story a story that I tell in the book um Dean Cayman like
I tell in the book um Dean Cayman like prolific inventor this was the
prolific inventor this was the development of the
development of the segue the like oh yeah balancing scooter
segue the like oh yeah balancing scooter thing yeah I remember I think this was a
thing yeah I remember I think this was a Time magazine article something like
Time magazine article something like that was like this is the this is the
that was like this is the this is the mystery invention we're not going to
mystery invention we're not going to talk about it yet the mystery invention
talk about it yet the mystery invention that is going to change the way that
that is going to change the way that cities are planned
cities are planned the hype for it was absolutely extreme
the hype for it was absolutely extreme and when it came out it turned out that
and when it came out it turned out that people didn't want to buy a $110,000
people didn't want to buy a $110,000 alternative to walking or riding a bike
alternative to walking or riding a bike and so it's like those like nobody's
and so it's like those like nobody's ever done this before can actually be in
ever done this before can actually be in in a weird way a bad
in a weird way a bad sign um you want something that like the
sign um you want something that like the market exists the need is there people
market exists the need is there people are excited about it people are looking
are excited about it people are looking for Solutions and then like liquid death
for Solutions and then like liquid death if you can come in and do it in a
if you can come in and do it in a fundamentally different way that grabs a
fundamentally different way that grabs a lot of attention it's a really really
lot of attention it's a really really great promising
great promising sign but if it's completely brand new
sign but if it's completely brand new that's that's more of a a warning sign
that's that's more of a a warning sign than than many of the sofa preneurs uh
than than many of the sofa preneurs uh would would chalk it up to be so how
would would chalk it up to be so how should we treat competitors then if I've
should we treat competitors then if I've got a competitor should I should I
got a competitor should I should I attack them should I block them what
attack them should I block them what should I do first learn from them
should I do first learn from them buy from them become their customer
buy from them become their customer learn as much as you can about what they
learn as much as you can about what they do how they do it um customers can be a
do how they do it um customers can be a wonderful source of market research
wonderful source of market research around what's what's happening in the
around what's what's happening in the category what's important what's not
category what's important what's not what was your experience competitors
what was your experience competitors yeah totally if you if you're starting a
yeah totally if you if you're starting a c Candle Company go out and buy all the
c Candle Company go out and buy all the candles burn them all smell them all
candles burn them all smell them all burn them all line your like buy a
burn them all line your like buy a bookshelf and fill it with candles why
bookshelf and fill it with candles why um because you can learn so much about
um because you can learn so much about how people do things um look at their
how people do things um look at their labeling deconstruct their packaging
labeling deconstruct their packaging look at their price points where are
look at their price points where are they selling how are they doing their
they selling how are they doing their online advertising um and the wonderful
online advertising um and the wonderful thing is aside from your time and maybe
thing is aside from your time and maybe a little bit of budget all that market
a little bit of budget all that market research is free you just get to go out
research is free you just get to go out and and learn from what people are doing
and and learn from what people are doing and then combine that with your own
and then combine that with your own research going out and talking to
research going out and talking to customers on your own having your own
customers on your own having your own experiences your own ideas and that's
experiences your own ideas and that's where you get your unique take your
where you get your unique take your taste your Twist on on that particular
taste your Twist on on that particular way of of doing things what else do I
way of of doing things what else do I need to be thinking about so I've done
need to be thinking about so I've done my market research on the candle
my market research on the candle business we've got the marketing done
business we've got the marketing done I'm I understand the the sort of sales
I'm I understand the the sort of sales framework that I should be thinking
framework that I should be thinking through I've bought every candle in the
through I've bought every candle in the market now MH is there anything else
market now MH is there anything else that is really important to be thinking
that is really important to be thinking about as I go forward and launch this
about as I go forward and launch this company oh yeah we haven't talked about
company oh yeah we haven't talked about dollars and cents at all yet dollars and
dollars and cents at all yet dollars and cents yeah Finance okay so you know as
cents yeah Finance okay so you know as you're doing all of so development takes
you're doing all of so development takes money making product uh requires money
money making product uh requires money um customer service requires money
um customer service requires money manufactur like all of the you're
manufactur like all of the you're spending a bunch of money making this
spending a bunch of money making this product you have at this point since
product you have at this point since this is a startup you have a price that
this is a startup you have a price that you think is supportable hopefully
you think is supportable hopefully you're collecting pre-orders you're
you're collecting pre-orders you're getting some Market information about
getting some Market information about like how much you potentially be able to
like how much you potentially be able to make here financial analysis is the part
make here financial analysis is the part where you're taking a look at all of
where you're taking a look at all of these decisions and tradeoffs that that
these decisions and tradeoffs that that you've been
you've been making where am I spending how
making where am I spending how much if I have to make a choice between
much if I have to make a choice between a or b which one am I am I going to make
a or b which one am I am I going to make and then the finan finance is basically
and then the finan finance is basically just a systematic way of making
just a systematic way of making decisions around monetary
decisions around monetary considerations um in the case of a
considerations um in the case of a manufacturing business you might have
manufacturing business you might have raised some some early Capital friends
raised some some early Capital friends family loans investors credit cards
family loans investors credit cards whatever how much do you have at your
whatever how much do you have at your disposal how much runway do you have if
disposal how much runway do you have if you've hired people how many months do
you've hired people how many months do you have left before you really need to
you have left before you really need to be bringing in more than than your
be bringing in more than than your outflows or else you're going to be in
outflows or else you're going to be in trouble very quickly I've got a
trouble very quickly I've got a corporate job and I've got $2,000 of
corporate job and I've got $2,000 of savings yeah okay so so relatively small
savings yeah okay so so relatively small so then like the financial decision
so then like the financial decision making might be how many candles if I
making might be how many candles if I make a small
make a small batch like maybe of that $2,000 how much
batch like maybe of that $2,000 how much am I going to allocate to making the
am I going to allocate to making the actual physical product packaging
actual physical product packaging shipping distribution how much am I
shipping distribution how much am I going to set aside for marketing and
going to set aside for marketing and sales sorts of thing that's an
sales sorts of thing that's an allocation decision and so your early
allocation decision and so your early decision making is how much do I have at
decision making is how much do I have at my disposal what are the the critical
my disposal what are the the critical things that need to be met I have to
things that need to be met I have to have product to sell I have to get
have product to sell I have to get people's attention somehow I have to be
people's attention somehow I have to be able to deliver this when people buy it
able to deliver this when people buy it and then you start making lots of
and then you start making lots of decisions lots of trade-offs about we're
decisions lots of trade-offs about we're going to put this here this here this
going to put this here this here this here this here what if you're bad at
here this here what if you're bad at math because a lot of people I think
math because a lot of people I think they're put off business because they
they're put off business because they hear about gross margin and net profit
hear about gross margin and net profit and revenue and they go oh God I was bad
and revenue and they go oh God I was bad at math in school so I'm never going to
at math in school so I'm never going to be good at business and or I meet a lot
be good at business and or I meet a lot of Entre especially in the den but just
of Entre especially in the den but just in life generally who basically avoid
in life generally who basically avoid the finances of their own business yeah
the finances of their own business yeah because it's just not their strong area
because it's just not their strong area so I think they think they can just
so I think they think they can just maybe they're right because I did meet
maybe they're right because I did meet Richard Branson and he told me that you
Richard Branson and he told me that you know he's not very astute with finances
know he's not very astute with finances and he said to me you just basically
and he said to me you just basically need to know three numbers in business
need to know three numbers in business um and he also said to me that he was
um and he also said to me that he was sort of 50 odd years old when he was in
sort of 50 odd years old when he was in a meeting where his directors were
a meeting where his directors were talking about net profit and he had had
talking about net profit and he had had no idea what they were talking about so
no idea what they were talking about so one of them pulled him out of the room
one of them pulled him out of the room and drew a picture of a ocean and put a
and drew a picture of a ocean and put a net in it and said the fish is in the
net in it and said the fish is in the net your net profit and at the time he
net your net profit and at the time he was running one of the biggest groups in
was running one of the biggest groups in Europe you just go so what how important
Europe you just go so what how important is this thing called finance and money
is this thing called finance and money and accounting yeah I mean most of it is
and accounting yeah I mean most of it is common sense in simple arithmetic really
common sense in simple arithmetic really like we're talking addition subtraction
like we're talking addition subtraction multiplication division um some of the
multiplication division um some of the the definitions when you really get down
the definitions when you really get down to it are relatively straightforward
to it are relatively straightforward um so how much you going to sell it for
um so how much you going to sell it for minus how much does it cost to make how
minus how much does it cost to make how much does it cost to Market how much
much does it cost to Market how much does it cost to deliver is your profit
does it cost to deliver is your profit um and then you know how much on the
um and then you know how much on the things that you have to spend um every
things that you have to spend um every month so in the case of an online
month so in the case of an online business uh your website your shopping
business uh your website your shopping cart credit card processing all the way
cart credit card processing all the way up to if if you have a physical business
up to if if you have a physical business how much are you spending on salaried
how much are you spending on salaried employees office space electricity
employees office space electricity utilities um there's some very
utilities um there's some very straightforward uh Concepts like
straightforward uh Concepts like amortization like can you take something
amortization like can you take something that would be a a larger pool of money
that would be a a larger pool of money how much does that cost you per month as
how much does that cost you per month as an equivalent can you build that into
an equivalent can you build that into your budget how do I learn this stuff if
your budget how do I learn this stuff if I didn't go to school that's why I wrote
I didn't go to school that's why I wrote the first LBA okay so yeah can you will
the first LBA okay so yeah can you will you tell me about all of this stuff if I
you tell me about all of this stuff if I get this book yes it so the the whole
get this book yes it so the the whole idea aidea behind personal MBA was to
idea aidea behind personal MBA was to take all of these Concepts like
take all of these Concepts like amortization like nonprofit all of this
amortization like nonprofit all of this and explain it in the clearest most
and explain it in the clearest most direct most straightforward plain
direct most straightforward plain language that I possibly could and is it
language that I possibly could and is it easy it's very straightforward yeah is
easy it's very straightforward yeah is there a a most important number or or a
there a a most important number or or a most important set of numbers in
most important set of numbers in business when it comes to running my
business when it comes to running my candle business if I was to really stay
candle business if I was to really stay focused on a particular number or metric
focused on a particular number or metric is there one in particular yeah I think
is there one in particular yeah I think so early on the things that you're going
so early on the things that you're going to want to pay very close attention to
to want to pay very close attention to like early stage entrepreneurship is all
like early stage entrepreneurship is all about is this Su are we to the point of
about is this Su are we to the point of keeping this business sustainable can we
keeping this business sustainable can we keep the lights on can we keep going and
keep the lights on can we keep going and is it worth it to me or not and
is it worth it to me or not and so your monthly fix
so your monthly fix overhead like how much am I spending
overhead like how much am I spending every month just to keep the lights on
every month just to keep the lights on everything cleaning yep everything my my
everything cleaning yep everything my my Gmail account everything yep okay yep so
Gmail account everything yep okay yep so what is what are my monthly
what is what are my monthly outflows what are my monthly sales
outflows what are my monthly sales numbers and it's monthly because usually
numbers and it's monthly because usually our modern expenses happen monthly rent
our modern expenses happen monthly rent payments happen monthly all that how
payments happen monthly all that how much is coming in product service offer
much is coming in product service offer sales how much does it cost to deliver
sales how much does it cost to deliver that in
that in total what is my monthly overhead
total what is my monthly overhead everything required to keep the lights
everything required to keep the lights on
on and at the end of that is net profit
and at the end of that is net profit which is how much do I get to
which is how much do I get to keep and is that enough so for example
keep and is that enough so for example if you're if you're working 80 hours a
if you're if you're working 80 hours a week keeping this candle business open
week keeping this candle business open and you have $5 to your name at the end
and you have $5 to your name at the end of that month you might be able to
of that month you might be able to sustain that for a little bit but at a
sustain that for a little bit but at a certain point there are going to be some
certain point there are going to be some very difficult decisions
very difficult decisions around technically we're making money
around technically we're making money but it's just not it's not enough to
but it's just not it's not enough to make this sustainable and so some of
make this sustainable and so some of that early number like as as an early
that early number like as as an early stage entrepreneur is like what is that
stage entrepreneur is like what is that for you like based on your life based on
for you like based on your life based on your lifestyle what you hope and dream
your lifestyle what you hope and dream for
for yourself what's the number that makes a
yourself what's the number that makes a venturous long-term sustainable like I
venturous long-term sustainable like I can keep doing this it makes sense for
can keep doing this it makes sense for right now to keep
right now to keep going you focus on getting to that
going you focus on getting to that number first and then from there you
number first and then from there you have a lot of different
have a lot of different options one of the mental models that I
options one of the mental models that I think we share is around this idea of
think we share is around this idea of experimentation yes absolutely and it's
experimentation yes absolutely and it's one of my favorite subjects because it's
one of my favorite subjects because it's been a real Revelation for me over the
been a real Revelation for me over the last couple of years in business um
last couple of years in business um which is really this idea that
which is really this idea that increasing my exp rate of
increasing my exp rate of experimentation increases my rate of
experimentation increases my rate of success and I think um you know the
success and I think um you know the podcast is an example of that for me
podcast is an example of that for me where we've really tried to experiment
where we've really tried to experiment as much as we can and that's led us to
as much as we can and that's led us to um the growth of the podcast but when I
um the growth of the podcast but when I look across the greatest entrepreneurs
look across the greatest entrepreneurs in the world they all seem to eventually
in the world they all seem to eventually arrive at this conclusion that
arrive at this conclusion that experimentation really is the path to
experimentation really is the path to finding the right answers in a world
finding the right answers in a world where the right answer is changing so
where the right answer is changing so much yep what is what is for for an
much yep what is what is for for an entrepreneur that's at the very
entrepreneur that's at the very beginning for someone that's at the very
beginning for someone that's at the very beginning or someone that's in the
beginning or someone that's in the corporate world what is it about
corporate world what is it about experimentation that you think is so
experimentation that you think is so important to understand yeah I think
important to understand yeah I think experimentation removes the
experimentation removes the pressure
pressure [Music]
[Music] to know or feel like you know what you
to know or feel like you know what you should be doing every moment of every
should be doing every moment of every day um I think there's there's a sense
day um I think there's there's a sense of like we kind of
of like we kind of conflate certainty or over certainty
conflate certainty or over certainty with competence in a way that's not
with competence in a way that's not necessarily functional whereas we're all
necessarily functional whereas we're all very imperfect oracles like we have
very imperfect oracles like we have anticipations based on our knowledge our
anticipations based on our knowledge our experiences um the information that
experiences um the information that we're collecting about the world around
we're collecting about the world around us and we're all using that all the time
us and we're all using that all the time to try to predict what's going to happen
to try to predict what's going to happen next just how our brains work it's what
next just how our brains work it's what our brains are
our brains are for
for and I think there's a sense of we can do
and I think there's a sense of we can do that to a certain extent to eliminate
that to a certain extent to eliminate some of the more obvious errors that we
some of the more obvious errors that we might make
might make but when it the when it comes down to
but when it the when it comes down to making a decision about something we've
making a decision about something we've never done before the honest answer to
never done before the honest answer to will this work
will this work is I don't know let's find
is I don't know let's find out and so there's a certain amount of
out and so there's a certain amount of if that's the case if we can't be 100%
if that's the case if we can't be 100% certain what's going to happen if we try
certain what's going to happen if we try plan a or plan b or plan
plan a or plan b or plan C then there are a couple of ways of
C then there are a couple of ways of approaching that one is is um by working
approaching that one is is um by working through scenarios of like let's just
through scenarios of like let's just imagine what would it look like if we
imagine what would it look like if we chose plan a let's play that out a
chose plan a let's play that out a little bit let's try to make
little bit let's try to make anticipations about what what might work
anticipations about what what might work or what might not um and let's compare
or what might not um and let's compare our different Alternatives and and see
our different Alternatives and and see what what looks the best feels the best
what what looks the best feels the best based on our anticipations right
based on our anticipations right now that's valuable but it can only go
now that's valuable but it can only go so far because it relies on all the the
so far because it relies on all the the knowledge and EXP experience that we've
knowledge and EXP experience that we've collected to date it doesn't account for
collected to date it doesn't account for the knowledge and experience that we're
the knowledge and experience that we're going to gain through the process of
going to gain through the process of making a choice and learning from the
making a choice and learning from the choice and so one of my very favorite
choice and so one of my very favorite mental models this comes from computer
mental models this comes from computer science and and
science and and decisionmaking is called the explore
decisionmaking is called the explore exploit
exploit trade-off
trade-off and this might be entertaining it comes
and this might be entertaining it comes from decision research uh actually about
from decision research uh actually about gambling of of all things like imagine
gambling of of all things like imagine um imagine you walk into a casino and
um imagine you walk into a casino and there are a 100 slot machines that you
there are a 100 slot machines that you get to play for
get to play for free each of the machines has a
free each of the machines has a different
different payoff but you don't know which one your
payoff but you don't know which one your job is to find the very best
job is to find the very best one how do you go about figuring that
one how do you go about figuring that out you try them all yeah you try them
out you try them all yeah you try them so you start collecting information
so you start collecting information right like the thing to do you when you
right like the thing to do you when you walk into the room you have no
walk into the room you have no information and so the first phase of
information and so the first phase of solving this problem is to explore you
solving this problem is to explore you just try a whole bunch of things and you
just try a whole bunch of things and you collect information every time you pull
collect information every time you pull this slot machine does it pay out or not
this slot machine does it pay out or not the longer you do this the more
the longer you do this the more information you collect and after a
information you collect and after a certain period of time you start to get
certain period of time you start to get a feel for patterns of some things seem
a feel for patterns of some things seem to be more Obviously good and other
to be more Obviously good and other things seem to be more obviously bad and
things seem to be more obviously bad and so over time you shift into the second
so over time you shift into the second phase which is called the exploitation
phase which is called the exploitation phase so you take the knowledge and
phase so you take the knowledge and experience that you have and you use it
experience that you have and you use it to do the best performing thing that
to do the best performing thing that you're aware of at the time more often
you're aware of at the time more often so you're playing the higher winning
so you're playing the higher winning slots
slots more the key is though the exploration
more the key is though the exploration phase never stops
phase never stops it just gets smaller over time so if
it just gets smaller over time so if you're going to play this game optimally
you're going to play this game optimally there's always a certain Subs segment of
there's always a certain Subs segment of your time that's dedicated to exploring
your time that's dedicated to exploring to collecting information to trying new
to collecting information to trying new things and I think this kind of General
things and I think this kind of General way of going about the like this is what
way of going about the like this is what early
early career early entrepreneurship looks like
career early entrepreneurship looks like you're trying a whole bunch of very
you're trying a whole bunch of very different things sometimes in in
different things sometimes in in information about what works and what
information about what works and what doesn't so in the context of my candle
doesn't so in the context of my candle business yeah I'm going to I'm going to
business yeah I'm going to I'm going to try a bunch of different candles I'm G
try a bunch of different candles I'm G to I'm going to try I think the key part
to I'm going to try I think the key part is we'll get like try other stuff but
is we'll get like try other stuff but the the part that I often see people
the the part that I often see people Overlook is what you actually said after
Overlook is what you actually said after that which was collect information uhuh
that which was collect information uhuh which is you know people will listen to
which is you know people will listen to this and they'll go C right guys they'll
this and they'll go C right guys they'll come to the corporate office they'll go
come to the corporate office they'll go right we're going to try a bunch of new
right we're going to try a bunch of new stuff but that is just wasted time if
stuff but that is just wasted time if you're not accurately correct collecting
you're not accurately correct collecting the feedback yes because that's the
the feedback yes because that's the power the feedback is the power right
power the feedback is the power right failure is nothing without feedback yeah
failure is nothing without feedback yeah exactly and that's like so trying the
exactly and that's like so trying the new thing and then paying very close
new thing and then paying very close attention to what happens is the
attention to what happens is the valuable part so like in the in the
valuable part so like in the in the context of the candle business like
context of the candle business like maybe you try 10 different scents at the
maybe you try 10 different scents at the very beginning and you do small batches
very beginning and you do small batches of each one and how do I test that in
of each one and how do I test that in the context of a candle business how do
the context of a candle business how do I test which is the best scent yeah so
I test which is the best scent yeah so um you could do all sorts of different
um you could do all sorts of different things like um early on you can get
things like um early on you can get direct feedback so follow up with people
direct feedback so follow up with people ask so this is where the like
ask so this is where the like quantitative and qualitative research
quantitative and qualitative research studies can be very very valuable so
studies can be very very valuable so your first source of information is what
your first source of information is what do people buy what's most appealing
do people buy what's most appealing where does where does that kind of
where does where does that kind of initial spark go you'll probably see a
initial spark go you'll probably see a distribution if you try 10 different
distribution if you try 10 different scents you you'll probably see a couple
scents you you'll probably see a couple very clearly stand out um and then
very clearly stand out um and then contacting customers directly to to
contacting customers directly to to follow up what did you like what did you
follow up what did you like what did you not like um asking quite like we were
not like um asking quite like we were talking earlier about how did it smell
talking earlier about how did it smell when it was lit how did it smell when it
when it was lit how did it smell when it was not lit like all of those things
was not lit like all of those things spending a little bit of of time digging
spending a little bit of of time digging into it in a deliberate systematic way
into it in a deliberate systematic way is how you get that information could I
is how you get that information could I do this before I even start selling
do this before I even start selling these candles I could I get 10 flavors
these candles I could I get 10 flavors um put blank labels on all of them and
um put blank labels on all of them and also try and create a situation where
also try and create a situation where you can't see it because again I'm
you can't see it because again I'm trying to limit the variable so I don't
trying to limit the variable so I don't want you to make your a decision based
want you to make your a decision based on color put you in a pitch black room
on color put you in a pitch black room this is actually what a lot of companies
this is actually what a lot of companies do companies I've invested in called hu
do companies I've invested in called hu does this they have these pitch black
does this they have these pitch black rooms at their HQ which they invite
rooms at their HQ which they invite people into and these are like sensory
people into and these are like sensory deprivation rooms I guess because you
deprivation rooms I guess because you there's no light there's no nothing you
there's no light there's no nothing you can't see anything and in the context of
can't see anything and in the context of candles get 10 strangers off the street
candles get 10 strangers off the street to smell them all maybe 100 yep and just
to smell them all maybe 100 yep and just to leave some scores yeah and then get
to leave some scores yeah and then get them to smell them when they're lit and
them to smell them when they're lit and take that data as well you can
take that data as well you can absolutely do that that's crazy it seems
absolutely do that that's crazy it seems so obvious but people don't do this
so obvious but people don't do this stuff yeah and it like it doesn't take
stuff yeah and it like it doesn't take that much more work you're actually
that much more work you're actually limiting your risk because you're not
limiting your risk because you're not committing to you know one big batch of
committing to you know one big batch of something that you think will work yeah
something that you think will work yeah you just experimenting a little bit more
you just experimenting a little bit more broadly collecting some information and
broadly collecting some information and allowing that information to guide your
allowing that information to guide your future to decisions you talk about this
future to decisions you talk about this thing in your book called goal's law
thing in your book called goal's law yeah what's gal's law G's law is the
yeah what's gal's law G's law is the idea that any complex system essentially
idea that any complex system essentially evolved from a simpler system that
evolved from a simpler system that worked so if you want to create a
worked so if you want to create a complex system that
complex system that works the easiest best thing to do is to
works the easiest best thing to do is to start with a simple system and then
start with a simple system and then build it up from
build it up from there and so this is like
there and so this is like when we're talking about this
when we're talking about this hypothetical candle business we're not
hypothetical candle business we're not talking about the multinational
talking about the multinational distribution version of the candle
distribution version of the candle business quite yet there's a simpler
business quite yet there's a simpler version of that business that must exist
version of that business that must exist in order for it to ever reach the level
in order for it to ever reach the level of complexity and success that would
of complexity and success that would allow that to actually operate in the
allow that to actually operate in the world and
world and so one of the the reminders of of G's
so one of the the reminders of of G's law is that it's actually okay to start
law is that it's actually okay to start simple straightforward strip it down
simple straightforward strip it down focus on the essentials start there
focus on the essentials start there because every additional bit of
because every additional bit of complexity needs to serve some sort of
complexity needs to serve some sort of purpose to justify its costs either
purpose to justify its costs either direct cost or time attention
direct cost or time attention opportunity
opportunity cost and so I think you to our earlier
cost and so I think you to our earlier conversation
conversation sometimes complexity can be seen as as a
sometimes complexity can be seen as as a bit of a weird
bit of a weird status signal like I'm fancy I'm
status signal like I'm fancy I'm sophisticated I think the more
sophisticated I think the more sophisticated thing to do is to start
sophisticated thing to do is to start simple and keep it simple on purpose and
simple and keep it simple on purpose and then make every additional bit of
then make every additional bit of complexity earn earn its way because
complexity earn earn its way because complexity isn't value this is I guess
complexity isn't value this is I guess this the the thing we get wrong we think
this the the thing we get wrong we think if we take a candle and we add some neon
if we take a candle and we add some neon lights to it and we add some I don't
lights to it and we add some I don't know like a metal lid to the top of it
know like a metal lid to the top of it and then we add you can charge your
and then we add you can charge your phone using the candle sure we think
phone using the candle sure we think because we've added more stuff people
because we've added more stuff people are going to Value it more therefore
are going to Value it more therefore they're going to pay for it more yeah
they're going to pay for it more yeah but that's not necessarily how the world
but that's not necessarily how the world works exactly you're going to screw up
works exactly you're going to screw up so many things by adding those features
so many things by adding those features you know the best example I can give is
you know the best example I can give is this whoop on my wrist which I'm an
this whoop on my wrist which I'm an investor in and Ambassador for so I'm
investor in and Ambassador for so I'm not Shilling it here but it's just a
not Shilling it here but it's just a something that always comes to mind
something that always comes to mind where you ask the founder of why you
where you ask the founder of why you didn't add
didn't add a watch to it why you didn't add the
a watch to it why you didn't add the time because you could simply just put
time because you could simply just put the time on there sure but he said
the time on there sure but he said adding an additional feature changes the
adding an additional feature changes the frame and that really made me understand
frame and that really made me understand this idea that more isn't more in as it
this idea that more isn't more in as it relates to value of products because the
relates to value of products because the minute you add the time to a whoop it
minute you add the time to a whoop it becomes a watch and then people have
becomes a watch and then people have these whole new set of expectations of a
these whole new set of expectations of a watch it's a fashion item etc etc
watch it's a fashion item etc etc interesting I've never heard that that
interesting I've never heard that that term before gouls law yeah we like it's
term before gouls law yeah we like it's instructive that we're talking about
instructive that we're talking about candles and not about some complex
candles and not about some complex mechanical device that you would bolt on
mechanical device that you would bolt on to a a building's a HB system to deliver
to a a building's a HB system to deliver scent to the entire space right like
scent to the entire space right like don't start there maybe start with a
don't start there maybe start with a candle and then at a certain point if it
candle and then at a certain point if it makes sense to move in a in a direction
makes sense to move in a in a direction based on what your customers are telling
based on what your customers are telling you that's fantastic but but keeping it
you that's fantastic but but keeping it simple from the beginning is is the way
simple from the beginning is is the way to go once upon a time if you had a
to go once upon a time if you had a business idea it was exceptionally
business idea it was exceptionally difficult to get going but now in the
difficult to get going but now in the age of Shopify it is exceptionally easy
age of Shopify it is exceptionally easy as many of you will know Shopify are
as many of you will know Shopify are sponsor of this podcast if you don't
sponsor of this podcast if you don't know Shopify it's an exceptionally
know Shopify it's an exceptionally simple web platform for anybody that's
simple web platform for anybody that's got an idea that wants to transact on a
got an idea that wants to transact on a global scale so things like these
global scale so things like these conversation cards which we sell we've
conversation cards which we sell we've sold using Shopify and it only took us a
sold using Shopify and it only took us a couple of clicks to get going so why did
couple of clicks to get going so why did we choose Shopify for a number of
we choose Shopify for a number of reasons but I think one of the big ones
reasons but I think one of the big ones which goes unappreciated is their
which goes unappreciated is their checkout system converts 36% better
checkout system converts 36% better compared to other platforms and here's
compared to other platforms and here's what I'm going to do to remove the cost
what I'm going to do to remove the cost for you if you go to shopify.com Bartlet
for you if you go to shopify.com Bartlet you'll be able to try Shopify for
you'll be able to try Shopify for $1 a month I've seen Shopify completely
$1 a month I've seen Shopify completely change people's lives and for many of
change people's lives and for many of you I think it could change yours we
you I think it could change yours we haven't spoken about this book though
haven't spoken about this book though first 20 hours yeah the first 20 hours
first 20 hours yeah the first 20 hours how to learn
how to learn anything and you have a TED Talk don't
anything and you have a TED Talk don't you which was crazy yeah crazy crazy I
you which was crazy yeah crazy crazy I don't know if it's hit 40 million views
don't know if it's hit 40 million views yet but PR pretty close if not 40
yet but PR pretty close if not 40 million views on a TED talk about the
million views on a TED talk about the first 20 hours how to learn anything
first 20 hours how to learn anything yeah why why did it do so well I think
yeah why why did it do so well I think for a couple of different reasons
for a couple of different reasons because that's one of the best view TED
because that's one of the best view TED talks of all time yes that's crazy yes I
talks of all time yes that's crazy yes I did a TED Talk nobody nobody watched it
did a TED Talk nobody nobody watched it I did like T talk are fun they're very
I did like T talk are fun they're very fun
fun um yeah so so the T talk for the first
um yeah so so the T talk for the first 20 hours did did very well and I think I
20 hours did did very well and I think I think part of it has to do
think part of it has to do with it's something we all have in
with it's something we all have in common right like wanting or needing to
common right like wanting or needing to learn
learn something necessary useful fun cool not
something necessary useful fun cool not really having a whole lot of time like
really having a whole lot of time like we're we're busy people we're busy
we're we're busy people we're busy culturally um and so there's a bit of a
culturally um and so there's a bit of a conflicting desire there of like yeah I
conflicting desire there of like yeah I want I want to learn this but I I don't
want I want to learn this but I I don't have a whole a lot of capacity to spare
have a whole a lot of capacity to spare here um and then the the Genesis of the
here um and then the the Genesis of the book was was digging into some of the
book was was digging into some of the psychology research that I that I
psychology research that I that I uncovered in the process of working on
uncovered in the process of working on personal MBA which was all about
personal MBA which was all about learning new
learning new things
things and learning that the first few
and learning that the first few hours of acquiring or learning any
hours of acquiring or learning any particular
particular skill are
skill are validated by research to be both the
validated by research to be both the most effective and the most efficient so
most effective and the most efficient so like your rate of improvement per time
like your rate of improvement per time of of uh or per unit of time and energy
of of uh or per unit of time and energy invested at the very beginning of
invested at the very beginning of Learning something new is extremely
Learning something new is extremely high and so the question that that
high and so the question that that sparked the research for the first 20
sparked the research for the first 20 hours is is there a way that we can take
hours is is there a way that we can take advantage of that consciously like is
advantage of that consciously like is there a way that we can
there a way that we can be very conscious and deliberate about
be very conscious and deliberate about how we approach the process of learning
how we approach the process of learning something new to
something new to make to to to reap the maximum rewards
make to to to reap the maximum rewards from that early stage of learning
from that early stage of learning something that you're not familiar with
something that you're not familiar with and how good can we get in in that early
and how good can we get in in that early early window and in my research you can
early window and in my research you can go from from knowing absolutely nothing
go from from knowing absolutely nothing about
about something to being reasonably good in
something to being reasonably good in much less time than than you would
much less time than than you would expect so in my experience that's about
expect so in my experience that's about 20 hours of focused deliberate practice
20 hours of focused deliberate practice so call it 40 minutes a day for about a
so call it 40 minutes a day for about a month but but the narrative out on the
month but but the narrative out on the market is that you have to do 10,000
market is that you have to do 10,000 hours I mean this is everyone uses this
hours I mean this is everyone uses this phrase in in society they say have you
phrase in in society they say have you done your 10,000
done your 10,000 hours so you're telling me it's actually
hours so you're telling me it's actually 20 hours is the key I'm saying different
20 hours is the key I'm saying different goals based on different objectives so
goals based on different objectives so um K Andrew Ericson was the researcher
um K Andrew Ericson was the researcher behind the the 10,000 hour
behind the the 10,000 hour rule and I think what's important to to
rule and I think what's important to to understand about that as a general
understand about that as a general guideline is those studies were focused
guideline is those studies were focused on
on Mastery of very competitive performance
Mastery of very competitive performance oriented activities so call it so the
oriented activities so call it so the original studies were done um with
original studies were done um with correlating practice hours to how high a
correlating practice hours to how high a position do you have in like the first
position do you have in like the first violin and an orchestra sort of thing
violin and an orchestra sort of thing and there was a correlation between like
and there was a correlation between like how much do you practice how good to you
how much do you practice how good to you get that's all well and good and yeah
get that's all well and good and yeah generally speaking the more deliberate
generally speaking the more deliberate practice that that you have on on a
practice that that you have on on a certain thing the the better you are
certain thing the the better you are that is a true
that is a true thing to me
me I think it's valuable to shift the spotlight from Mastery which is very
spotlight from Mastery which is very flashy very high status people who are
flashy very high status people who are extremely skilled at things have a lot
extremely skilled at things have a lot of energy and attention around them
of energy and attention around them that's
that's great
great um the type of skill acquisition that
um the type of skill acquisition that most of us do most often throughout our
most of us do most often throughout our entire
entire lifespan is figure out how to do
lifespan is figure out how to do something new for the first time like
something new for the first time like dejing for me exactly yeah so how do I
dejing for me exactly yeah so how do I do that then know you talk about these
do that then know you talk about these 10 major principles of Rapid skill
10 major principles of Rapid skill acquisition sure where I can learn
acquisition sure where I can learn anything in 20 hours what are the most
anything in 20 hours what are the most important elements of this that I need
important elements of this that I need to know about if I'm someone who maybe
to know about if I'm someone who maybe let's in the context of business has
let's in the context of business has never started a business in my life has
never started a business in my life has never run one before but I do want to
never run one before but I do want to learn how to do it yeah the best way to
learn how to do it yeah the best way to approach
approach this is
this is um there's a set of five recommendations
um there's a set of five recommendations that that that go in
that that that go in order and the first is like deciding
order and the first is like deciding exactly what it is that you're trying to
exactly what it is that you're trying to do so in my experience like a lot of
do so in my experience like a lot of people when they at the beginning of the
people when they at the beginning of the process of learning how to do
process of learning how to do something the goal is way too big like
something the goal is way too big like it's way too much way too soon
it's way too much way too soon um whereas something something specific
um whereas something something specific concrete and approachable
concrete and approachable is a way better place to start so um
is a way better place to start so um dejing an entire set at a crazy music
dejing an entire set at a crazy music festival is not the place to set the
festival is not the place to set the goal right at the very beginning
goal right at the very beginning it's I want to do my first song for
it's I want to do my first song for myself for me it was like I want to mix
myself for me it was like I want to mix that song into that song without it
that song into that song without it sounding [ __ ] totally exactly and that's
sounding [ __ ] totally exactly and that's a great place to start because then it's
a great place to start because then it's like okay this is a concrete specific
like okay this is a concrete specific thing I know exactly what it looks like
thing I know exactly what it looks like you probably had some experience
you probably had some experience listening to music of this type knowing
listening to music of this type knowing when things go well and when they when
when things go well and when they when they don't go well so you had a little
they don't go well so you had a little bit of like taste context
bit of like taste context perspective and so deciding like okay my
perspective and so deciding like okay my early goal is to do this one specific
early goal is to do this one specific thing it's the first failure mode
thing it's the first failure mode because most people don't decide on that
because most people don't decide on that concrete specific thing it's way way too
concrete specific thing it's way way too way too nebulous there's not enough to
way too nebulous there's not enough to work with so deciding is the first
work with so deciding is the first part from
part from there most of the things that we we talk
there most of the things that we we talk about as skills
about as skills aren't single skills they're actually
aren't single skills they're actually bundles of smaller subskills that are
bundles of smaller subskills that are all important and you use in in in in
all important and you use in in in in combination and so I'm not familiar with
combination and so I'm not familiar with DJ DJing so you can fill in the blanks
DJ DJing so you can fill in the blanks for me but like what were some of the
for me but like what were some of the smaller things that you needed to learn
smaller things that you needed to learn how to do as a thing to be able to like
how to do as a thing to be able to like mix one song into another well you need
mix one song into another well you need to know music because music has
to know music because music has different I'm really going to but you so
different I'm really going to but you so DJs are literally going to laugh at me
DJs are literally going to laugh at me in their WhatsApp groups but um
in their WhatsApp groups but um different beats per minute so every song
different beats per minute so every song has a different beat per minute so you
has a different beat per minute so you need to learn about the different beats
need to learn about the different beats per minute so you can merge them um
per minute so you can merge them um every song has a different key I think
every song has a different key I think that's kind of what they call it a key
that's kind of what they call it a key so you have like an a a b a c and you
so you have like an a a b a c and you need to know that because before you
need to know that because before you even get to mixing them in that's quite
even get to mixing them in that's quite important um so that's the like the
important um so that's the like the music side of thing then there's the
music side of thing then there's the like the hardware itself which is
like the hardware itself which is knowing how you see two songs coming at
knowing how you see two songs coming at the same time so you need to learn about
the same time so you need to learn about the hardware before you can mix two
the hardware before you can mix two songs together and then
songs together and then um yeah actually interestingly in the
um yeah actually interestingly in the first hour of lessons I was expecting to
first hour of lessons I was expecting to jump on the decks but the first hour of
jump on the decks but the first hour of lessons that I had was all about what is
lessons that I had was all about what is music totally it was like an and how
music totally it was like an and how does music sound good and this kind of
does music sound good and this kind of like eight bar thing that music goes in
like eight bar thing that music goes in so it was all about music itself I had
so it was all about music itself I had to start over there whereas I was
to start over there whereas I was expecting to jump on the decks yes that
expecting to jump on the decks yes that is a brilliant example of deconstruction
is a brilliant example of deconstruction it's exactly what we're talking about so
it's exactly what we're talking about so the skill is not dejing itself it's
the skill is not dejing itself it's learning about Keys learning about Tempo
learning about Keys learning about Tempo learning about transitions learning
learning about transitions learning about all of these smaller things that
about all of these smaller things that you need to use in concert in order to
you need to use in concert in order to use them together to do this more
use them together to do this more complex thing that you want to do so a
complex thing that you want to do so a good teacher like the value of a good
good teacher like the value of a good teacher is they can help you with that
teacher is they can help you with that deconstruction like what are all the
deconstruction like what are all the little subcomponents that I need and
little subcomponents that I need and then the next layer down from that is
then the next layer down from that is once you've deconstructed into the
once you've deconstructed into the smaller parts that's when you start to
smaller parts that's when you start to do some research of which of these parts
do some research of which of these parts are more important or less important
are more important or less important what should I focus on first what can
what should I focus on first what can wait until later and so like Tempo and
wait until later and so like Tempo and musical Keys might be really important
musical Keys might be really important and so it might make sense to to start
and so it might make sense to to start the process there let's get that really
the process there let's get that really solid we can wait for the hardware we
solid we can wait for the hardware we can wait for the plugins we can wait for
can wait for the plugins we can wait for you know all of these things that comes
you know all of these things that comes later get this stuff down solid first
later get this stuff down solid first nobody wants to wait yeah you know you
nobody wants to wait yeah you know you know what I mean that's the thing
know what I mean that's the thing like I
like I think there's an element to which that's
think there's an element to which that's true there's also an element
true there's also an element to waiting here going about it in a
to waiting here going about it in a little bit more of a deliberate
little bit more of a deliberate fashion is what gives us an Advantage as
fashion is what gives us an Advantage as adult Learners like we can approach what
adult Learners like we can approach what we're doing in in a strategic way we can
we're doing in in a strategic way we can we can focus our time and attention on
we can focus our time and attention on the things that are going to have the
the things that are going to have the highest rewards first and so just a
highest rewards first and so just a little bit of impulse control of like
little bit of impulse control of like I'm gonna hold off on the buttons for a
I'm gonna hold off on the buttons for a couple hours to learn a little bit of
couple hours to learn a little bit of this first like that's where you
this first like that's where you start figuring
start figuring out the inflection points in the skill
out the inflection points in the skill like the the thing that if you can just
like the the thing that if you can just wrap your head around this you can get a
wrap your head around this you can get a huge Improvement in a very short period
huge Improvement in a very short period of time and then the trick on the
of time and then the trick on the research phase and this is the one that
research phase and this is the one that I struggle with a lot because I like
I struggle with a lot because I like research it's fun for me I can get stuck
research it's fun for me I can get stuck here and so the trick is to
here and so the trick is to do just enough research to give
do just enough research to give yourself context understanding what
yourself context understanding what you're looking for an idea of what it
you're looking for an idea of what it looks like to do well or to not do well
looks like to do well or to not do well and from
and from there you do just enough to know a
there you do just enough to know a little bit of what you're doing and then
little bit of what you're doing and then you actually start the focused
you actually start the focused deliberate practice component because
deliberate practice component because that's where the skill is actually built
that's where the skill is actually built the skill is not built in research a lot
the skill is not built in research a lot of people seem to get stuck on that
of people seem to get stuck on that research part because they are you know
research part because they are you know that people call them in culture
that people call them in culture procrastinators but I had a conversation
procrastinators but I had a conversation with Nel and he said we're discomfort
with Nel and he said we're discomfort avoiding creatures and he said whenever
avoiding creatures and he said whenever you find yourself
you find yourself procrastinating um it's basically
procrastinating um it's basically because there's discomfort associated
because there's discomfort associated with the task at hand yeah so I had a
with the task at hand yeah so I had a conversation with someone very close to
conversation with someone very close to me recently actually yesterday and um in
me recently actually yesterday and um in our conversation they've been meaning to
our conversation they've been meaning to do this online project for a long long
do this online project for a long long time for two years now and they've just
time for two years now and they've just done everything but this online project
done everything but this online project and when we kind of deconstructed it as
and when we kind of deconstructed it as you said it was really
you said it was really because they don't feel competent yeah
because they don't feel competent yeah in several of the individual pieces so
in several of the individual pieces so they're just like researching themselves
they're just like researching themselves to death and Mak taking no action
to death and Mak taking no action absolutely this is one of the biggest
absolutely this is one of the biggest the biggest barriers to learning as an
the biggest barriers to learning as an adult um adult Learners hate to feel
adult um adult Learners hate to feel stupid we hate to to feel over our head
stupid we hate to to feel over our head that we don't know what we're doing that
that we don't know what we're doing that we're going to look bad in front of
we're going to look bad in front of others that there's some idealized skill
others that there's some idealized skill level that would represent success and
level that would represent success and your early attempts look nothing like
your early attempts look nothing like that um there was an interesting study
that um there was an interesting study that was done
that was done about changes in um in artistic ability
about changes in um in artistic ability and inclination over the human lifespan
and inclination over the human lifespan and so when when you ask a bunch of
and so when when you ask a bunch of young
young children are you an
children are you an artist every one of them answerers yes
artist every one of them answerers yes yeah I create art that's it's what I do
yeah I create art that's it's what I do and there's a certain threshold and it
and there's a certain threshold and it usually happens around like the the
usually happens around like the the Middle grades uh junior
Middle grades uh junior highish where people will start to say
highish where people will start to say like no this not something that I do and
like no this not something that I do and there's a certain amount of
there's a certain amount of self-consciousness that develops in the
self-consciousness that develops in the process of becoming an adult where you
process of becoming an adult where you can start to recognize that the
can start to recognize that the difference between what you can do and
difference between what you can do and what you want to do can be somewhat
what you want to do can be somewhat extreme yeah and that self-consciousness
extreme yeah and that self-consciousness can be an active barrier to to getting
can be an active barrier to to getting started in the first place um so by comp
started in the first place um so by comp comparison as well isn't it really
comparison as well isn't it really because yeah like comparison with other
because yeah like comparison with other people and then also comparison with
people and then also comparison with ourselves MH um so with other people
ourselves MH um so with other people like early stages of skill acquisition
like early stages of skill acquisition if you're comparing yourself to the
if you're comparing yourself to the Masters in hours one two and three you
Masters in hours one two and three you are not doing yourself any favors at all
are not doing yourself any favors at all um and then even
um and then even like I think that's a little bit easier
like I think that's a little bit easier to avoid because I have only golfed a
to avoid because I have only golfed a couple times in my
couple times in my life comparing myself to Tiger Woods
life comparing myself to Tiger Woods doesn't feel like even like conceptually
doesn't feel like even like conceptually appropriate thing for me to do that
appropriate thing for me to do that that's that's not difficult the harder
that's that's not difficult the harder thing is comparing yourself to the other
thing is comparing yourself to the other person who has not golfed very much but
person who has not golfed very much but somehow hit a shot straight or or
somehow hit a shot straight or or whatever or like it feels like this
whatever or like it feels like this shouldn't be so hard for me why is this
shouldn't be so hard for me why is this so hard for me and then like the self
so hard for me and then like the self recrimination feedback loop starts and
recrimination feedback loop starts and so um I talk about in the in the first
so um I talk about in the in the first 20 hours
20 hours I call this the frustration barrier and
I call this the frustration barrier and so generally speaking rough rule of
so generally speaking rough rule of thumb hours 1 to 10 are brutal
thumb hours 1 to 10 are brutal emotionally speaking and so those th
emotionally speaking and so those th that's the period of time where um
that's the period of time where um you're really frustrated things make
you're really frustrated things make very little sense you're like I don't
very little sense you're like I don't know what a key is let alone a key
know what a key is let alone a key change what's a beat per minute and like
change what's a beat per minute and like all of those self-consciousness circuits
all of those self-consciousness circuits are fully online fully firing
are fully online fully firing and um no matter how much you want
and um no matter how much you want something those those first few hours
something those those first few hours can be pretty brutal it's where most
can be pretty brutal it's where most people quit as well I guess yeah and and
people quit as well I guess yeah and and that's why like it's an it's an
that's why like it's an it's an emotional management problem and so the
emotional management problem and so the way to get around that also the way to
way to get around that also the way to get out of research mode into doing mode
get out of research mode into doing mode and this is this is where where the
and this is this is where where the title the first 20 hours comes from from
title the first 20 hours comes from from the first 20 hours refers to a
the first 20 hours refers to a pre-commitment which is a very useful
pre-commitment which is a very useful piece of Behavioral
piece of Behavioral psychology that says that if you
psychology that says that if you pre-commit to taking a certain action
pre-commit to taking a certain action either a certain amount of times or
either a certain amount of times or within a certain period of time either
within a certain period of time either to yourselves or ideally to other people
to yourselves or ideally to other people you're far more likely to actually
you're far more likely to actually follow through on the doing of the thing
follow through on the doing of the thing and so what I found is that in learning
and so what I found is that in learning a new skill making a pre-commitment that
a new skill making a pre-commitment that no matter what I'm going to spend 20
no matter what I'm going to spend 20 hours doing this thing I might be
hours doing this thing I might be terrible this might be really
terrible this might be really uncomfortable I might hate it I might
uncomfortable I might hate it I might never do this again but no matter what I
never do this again but no matter what I care about this thing that I want to
care about this thing that I want to learn enough that I'm going to invest at
learn enough that I'm going to invest at least 20 hours of my life figuring out
least 20 hours of my life figuring out if this is good if this works for me if
if this is good if this works for me if this is beneficial you said something
this is beneficial you said something there which I think is key which is sure
there which I think is key which is sure you said this matters to me enough yes
you said this matters to me enough yes that feels like it's a prerequisite
that feels like it's a prerequisite something that we really need to be
something that we really need to be clear on before we even start yeah you
clear on before we even start yeah you know because without that part you you
know because without that part you you refer to it in your 10 major principles
refer to it in your 10 major principles of Rapid skill acquisition as choosing a
of Rapid skill acquisition as choosing a lovable project exactly yeah what does
lovable project exactly yeah what does that matter well it's because we're busy
that matter well it's because we're busy it's because we don't have infinite time
it's because we don't have infinite time energy and attention to do all the
energy and attention to do all the things that might look feel sound fun or
things that might look feel sound fun or interesting to us and
interesting to us and so there there needs to be at least some
so there there needs to be at least some minimum threshold of yeah this is
minimum threshold of yeah this is important to me to make some trade-offs
important to me to make some trade-offs in other areas of of my life or
in other areas of of my life or to um not watch that that movie or you
to um not watch that that movie or you know not relax on on social media this
know not relax on on social media this night I'm going to carve out some time
night I'm going to carve out some time in my day and actually make this a
in my day and actually make this a priority to sit down and do the work and
priority to sit down and do the work and generally speaking I found that for
generally speaking I found that for myself if I'm not willing to make the
myself if I'm not willing to make the pre-commitment to put at least 20 hours
pre-commitment to put at least 20 hours into it that's a pretty good indication
into it that's a pretty good indication that it is not important enough for me
that it is not important enough for me to to invest time and energy and in the
to to invest time and energy and in the first place we've been through most of
first place we've been through most of them there so number one is choose a
them there so number one is choose a lovable project number two is focus your
lovable project number two is focus your energy on one skill at a time we said
energy on one skill at a time we said that one number three is Define your
that one number three is Define your target performance level we talked about
target performance level we talked about that as well number four is deconstruct
that as well number four is deconstruct the skill and subskills number five is
the skill and subskills number five is obtain critical tools which I guess is
obtain critical tools which I guess is the tools you need to do the practice
the tools you need to do the practice right yeah that's um kind of a subset of
right yeah that's um kind of a subset of removing barriers to practice okay and
removing barriers to practice okay and so the classic example here is um so
so the classic example here is um so many people in the world want to learn
many people in the world want to learn how to play the
how to play the guitar and so the thing to not do is buy
guitar and so the thing to not do is buy a guitar and leave it in the case and
a guitar and leave it in the case and put it in uh a closet upstairs far away
put it in uh a closet upstairs far away because that just requires too much time
because that just requires too much time energy thought attention of like
energy thought attention of like remembering where it is going upstairs
remembering where it is going upstairs grabbing the guitar getting it out of
grabbing the guitar getting it out of the case getting all ready the best
the case getting all ready the best thing that you can do is just make it
thing that you can do is just make it really really easy remove all the
really really easy remove all the friction from it get a little stand put
friction from it get a little stand put it right next to you know your living
it right next to you know your living room chair or couch where it's visible
room chair or couch where it's visible Insight all you need to do is reach over
Insight all you need to do is reach over grab it and start it just makes it more
grab it and start it just makes it more likely you're actually going to sit down
likely you're actually going to sit down and do the work I think we've covered
and do the work I think we've covered all 10 there the last one is emphasize
all 10 there the last one is emphasize quantity and speed yes yes mean so early
quantity and speed yes yes mean so early on in in the
on in in the process there's a tendency to like want
process there's a tendency to like want to do
to do it perfectly
it perfectly sooner versus do it doing it in
sooner versus do it doing it in perfectly more is actually more
perfectly more is actually more beneficial and so in this case you for
beneficial and so in this case you for for your
for your DJing mixing a lot of songs one to the
DJing mixing a lot of songs one to the other is going to teach you a lot more
other is going to teach you a lot more than just hyperfocusing on what song A
than just hyperfocusing on what song A into song b and I'm going to work until
into song b and I'm going to work until this is perfect you're just not going to
this is perfect you're just not going to learn as much it's the variety the
learn as much it's the variety the exploration and the variety of
exploration and the variety of circumstances will teach you more about
circumstances will teach you more about what it looks and feels and sounds like
what it looks and feels and sounds like than trying to get too perfect on one
than trying to get too perfect on one specific thing too quickly so like going
specific thing too quickly so like going back to the the playing guitar thing
back to the the playing guitar thing like get a bunch of tabs and learn how
like get a bunch of tabs and learn how to play a whole bunch of different songs
to play a whole bunch of different songs not super well because it's the
not super well because it's the commonalities that you learn between the
commonalities that you learn between the different experiences those are the
different experiences those are the things that really tune you into what's
things that really tune you into what's really important the foundations of the
really important the foundations of the exactly like yeah what's a chord so for
exactly like yeah what's a chord so for what's a chord how do you change from
what's a chord how do you change from one chord to another
one chord to another um tracking beats Tempo things like that
um tracking beats Tempo things like that like those are the foundational skills
like those are the foundational skills that apply across pieces of music and so
that apply across pieces of music and so if you practice those first across a
if you practice those first across a wide variety of things that's just
wide variety of things that's just optimizing that early practice around
optimizing that early practice around things that will stick that you you'll
things that will stick that you you'll use a lot is there anything about the
use a lot is there anything about the subjec of learning and the first 20
subjec of learning and the first 20 hours that we've not discussed that you
hours that we've not discussed that you think is especially important to close
think is especially important to close off on if someone is really that they
off on if someone is really that they want to learn a new skill and we're
want to learn a new skill and we're thinking about where they are and where
thinking about where they are and where they want to get to is there anything
they want to get to is there anything else that you think they need to know
else that you think they need to know that we haven't covered I think that
that we haven't covered I think that this duv Tales a little bit with our
this duv Tales a little bit with our conversation around pon
conversation around pon spend more of your time doing weird cool
spend more of your time doing weird cool things like having that that exploration
things like having that that exploration budget of of really just like the
budget of of really just like the further a field you go the more things
further a field you go the more things you discover you'll find some surprising
you discover you'll find some surprising commonalities that can be very
commonalities that can be very interesting and very cool um we were
interesting and very cool um we were talking about Apple
talking about Apple earlier one of the primary design in
earlier one of the primary design in irations for for the Apple Computing
irations for for the Apple Computing system was Steve Jobs taking a random
system was Steve Jobs taking a random calligraphy class in
calligraphy class in college and it's not something that you
college and it's not something that you would put together in some sort of
would put together in some sort of obvious way but it was an important
obvious way but it was an important enough influence of being able to take
enough influence of being able to take some part of life and like apply it in a
some part of life and like apply it in a different way in a different context to
different way in a different context to another thing that that unlocked a lot
another thing that that unlocked a lot of value for a lot of people and so
of value for a lot of people and so for me like in in in the larger
sense I think it's just really valuable to take a step back and think about like
to take a step back and think about like what might I want to experience or what
what might I want to experience or what might I want to learn how to do at some
might I want to learn how to do at some point in my life just make a list could
point in my life just make a list could and it can be I think self-editing here
and it can be I think self-editing here is is not the way to go just like make a
is is not the way to go just like make a list of all the things that that appeal
list of all the things that that appeal to you for whatever reason and then the
to you for whatever reason and then the benefit of of a an approach like the
benefit of of a an approach like the first 20 hours is it gives you a way to
first 20 hours is it gives you a way to make actually going about doing that
make actually going about doing that thing look and feel far more
thing look and feel far more approachable than it otherwise might be
approachable than it otherwise might be when you said the thing about Apple
when you said the thing about Apple there in Steve Jobs going to that
there in Steve Jobs going to that typography calligraphy class it made me
typography calligraphy class it made me it made me realize that in life there
it made me realize that in life there really is no such thing as a waste of
really is no such thing as a waste of time no there's really not because we
time no there's really not because we you know we think of oh chilling on
you know we think of oh chilling on Netflix as a waste of time
Netflix as a waste of time but you can uncover something about
but you can uncover something about story arc from watching a movie that
story arc from watching a movie that makes you bring that into your creative
makes you bring that into your creative work or into an advertising campaign and
work or into an advertising campaign and you know I think some actually it's
you know I think some actually it's interestingly because if you think about
interestingly because if you think about that example you gave of Steve Jobs in
that example you gave of Steve Jobs in that typography class had he just gone
that typography class had he just gone to computer programming lessons yeah
to computer programming lessons yeah about how to make software or Hardware
about how to make software or Hardware he wouldn't have stumbled across the
he wouldn't have stumbled across the brilliant sort of insight that design
brilliant sort of insight that design and typography and calligraphy really
and typography and calligraphy really really matters so these devices wouldn't
really matters so these devices wouldn't be so amazing so sometimes the most
be so amazing so sometimes the most valuable skills or inspiration we can
valuable skills or inspiration we can acquire exists clearly outside of the
acquire exists clearly outside of the bubble that we work in
bubble that we work in totally Josh we have a closing tradition
totally Josh we have a closing tradition on this podcast where the last guest
on this podcast where the last guest leaves a question for the next guest not
leaves a question for the next guest not knowing who they're going to leave it
knowing who they're going to leave it for oh excellent that's fun and the last
for oh excellent that's fun and the last question that was left for you is oh
question that was left for you is oh they finally got some finally someone
they finally got some finally someone with good handwriting um I can read this
with good handwriting um I can read this one without stuttering when you look
one without stuttering when you look back on your life are there more things
back on your life are there more things you regret doing or regret not doing
you regret doing or regret not doing please give some
please give some examples wow they they went heavy
examples wow they they went heavy hitting on this one a stitch up I love
hitting on this one a stitch up I love this stitches up the next cast no it's
this stitches up the next cast no it's good
um I think I have more mistakes of commission things
have more mistakes of commission things I've
I've done than m Stakes of omission or or
done than m Stakes of omission or or regrets so generally speaking like if I
regrets so generally speaking like if I can anticipate that I'm going to regret
can anticipate that I'm going to regret something I just try not to do that
something I just try not to do that thing in the first place
thing in the first place um
um and I think some of those things like
and I think some of those things like can can fall into like daydreamy sorts
can can fall into like daydreamy sorts of oh what would have happened if I oh
of oh what would have happened if I oh yeah like hindsight yeah I mean almost
yeah like hindsight yeah I mean almost pure hindsight bias yeah which is also
pure hindsight bias yeah which is also one of the things I talk about in
one of the things I talk about in personal NBA like it's a it's a thing so
personal NBA like it's a it's a thing so um for me it
um for me it is like a lot of those regrets revolve
is like a lot of those regrets revolve around um decisions that I made that
around um decisions that I made that didn't work out
didn't work out um
um relationships um I have I have two kids
relationships um I have I have two kids and the process of of raising kids is uh
and the process of of raising kids is uh hopefully informed trial and error but
hopefully informed trial and error but like fundamentally trial and error and
like fundamentally trial and error and um yeah that's part of the learning and
um yeah that's part of the learning and the experimentation too of just
the experimentation too of just like sometimes you have to make the call
like sometimes you have to make the call on the Fly and sometimes you don't know
on the Fly and sometimes you don't know whether the call you made is is the
whether the call you made is is the right one the best
right one the best one um do you have a mental model or
one um do you have a mental model or framework for decisions generally I
framework for decisions generally I really like my fundamental way of
really like my fundamental way of approaching decisions
approaching decisions is scenario planning like I really try
is scenario planning like I really try to think through all right what are my
to think through all right what are my options here how much detail can I
options here how much detail can I create around each of these potential
create around each of these potential options what are the trade-offs are
options what are the trade-offs are there any really like hard trade-offs
there any really like hard trade-offs things that must be accounted for and
things that must be accounted for and then just really TR like in my current
then just really TR like in my current understanding try to play out what's
understanding try to play out what's likely to have happen down each of those
likely to have happen down each of those paths and then pick the one that seems
paths and then pick the one that seems the best or the most appropriate given
the best or the most appropriate given the
the circumstances Josh thank you thank you
circumstances Josh thank you thank you for writing two exceptionally important
for writing two exceptionally important books and really you know I I'm a real
books and really you know I I'm a real big Advocate and believer that we need
big Advocate and believer that we need more entrepreneurs in the world but more
more entrepreneurs in the world but more people just generally that understand
people just generally that understand business even if they're going to
business even if they're going to continue to work in corporate
continue to work in corporate environments because I think that's net
environments because I think that's net benefit Ben I think that's net
benefit Ben I think that's net beneficial to Society at large our
beneficial to Society at large our society but also to individuals because
society but also to individuals because it empowers them to have more
it empowers them to have more optionality in their lives to be able to
optionality in their lives to be able to make more choices about what they want
make more choices about what they want to do where they want to spend their
to do where they want to spend their time and societies run on businesses you
time and societies run on businesses you know what we're doing now is a business
know what we're doing now is a business um the way that I'll get home tonight is
um the way that I'll get home tonight is a business so understanding the
a business so understanding the fundamentals the levers that are running
fundamentals the levers that are running Society I think is only net positive for
Society I think is only net positive for everybody and that's exactly what the
everybody and that's exactly what the personal NBA does it deconstructs what
personal NBA does it deconstructs what businesses are and it helps us
businesses are and it helps us understand the world around us and the
understand the world around us and the incentive structures of the world around
incentive structures of the world around us in a really really empowering way so
us in a really really empowering way so thank you for writing a book that really
thank you for writing a book that really speaks to those people that maybe can't
speaks to those people that maybe can't afford to go and get a very expensive
afford to go and get a very expensive ensive NBA one of those top schools um
ensive NBA one of those top schools um but gives them an equally if not more
but gives them an equally if not more important understanding of business than
important understanding of business than anything ever could it's an exceptional
anything ever could it's an exceptional book and I applaud you for writing it so
book and I applaud you for writing it so thank you thank you very much that was
thank you thank you very much that was very kind to say and I appreciate it
very kind to say and I appreciate it [Music]
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