All right. You just got done hanging out with some big ballers. It wore off on you to where you think you have the audacity to wear a varsity jacket.
Is it Marty McFly from Back to the Future? Is that your stylist?
It's AC Slater from Saved by the Bell.
We just threw one of our annual events. It's our basketball camp for founders, what Forbes calls the billionaires' basketball camp. They never covered it, but I did pitch that to them in an email that they didn't reply to. And yeah, so we did this thing. It was amazing. And I guess what you want to debrief? Should we... What do you want to know?
Yeah. Yeah. I want to know everything. So I've gone two out of the four years. And it seems like each time the average net worth has gone up, like you've added a zero to it. Because I think I heard you did this event this year in Greenville, North Carolina, I think, which is a very small town, and there were 17 private jets in town that weekend.
Yeah. Out of like 25 guests.
Yeah, it's pretty crazy. So, okay. So I wrote down some learnings because I don't want to tell you too much about the event.
Well, can you give some background to it? The 30-second description is I hate conferences because networking, suits and ties, ice breakers, awkward forced social interactions. Don't like that part. But I also do love meeting new interesting people. So the idea was like, can you have the good without the bad? Can you have your cake and eat it too? And I've learned in the past that basically every time you complain, you've planted a seed of an opportunity. So like my complaint about conferences signaled to me that maybe there's an opportunity to reinvent this, right? Innovation comes from irritation. So my irritation at conferences led me to ask a different question. What would be the type of conference that I would love to go to? And so we kind of architected this thing that's basically just the three things we like the most put together. So it was, well, what if we got together and instead of being in like a ballroom sea of the hotel and we're all just standing around awkwardly? What if we got together and we played sports? So what if we played basketball? So the ice breaker is when you get to the event, you get put on teams and within an hour we go play pick-up basketball together and you get to know each other that way before you do small talk and all this other stuff.
The second part is so you play basketball and sort of sweat all day and then at night we all hang out in a house and we do like impromptu versions of TED talks. So the idea is everybody in the room is world class at something. It's like that guy knows more about how to sell on TV infomercials than anyone else and this guy could build the largest company in X category. This guy built the largest company in X category. And so you pop them up and you say, "Hey, tell us, you know, teach us about that." And they have little like rough slides that they take a 10-minute talk about. So that's the idea of the event is two days with 25 of the most interesting people in the world. You play sports and it feels like you have a summer camp vibe, but then you get the sort of lessons learned of a TED Talk event.
And you're hosting it, co-hosting it, I don't know how you describe it, with Jimmy aka Mr. Beast at his campus. And last year, and I think every year, you get like a tour. One of the activities was like a tour of his movie studio, if that's what he calls it. And it's pretty...
This year is cool. We actually played a Mr. Beast game. So like they thought they were going for the tour, but we set it up so that he's like, "Well, I could show you this. You want to do it?" And he had the cameras and the microphones set up and so everybody got to play this game. And they made a video that's like private just for like... it won't go out on YouTube, but it's like just for the group. It's like the rich man version of going on like a Six Flags ride and they take a photo of you on the ride.
Yeah, exactly. I was like, "Have you ever done this before?" He's like, "Yeah, we do this for the Make-A-Wish kids." And I was like, "Oh, perfect. This is great."
And so, do you want to... can you say who was there or is that what you...
I don't want to talk too much about who was there, but I'll give you a couple of stories. So I just wrote down three little lessons learned. I'm going to try to keep this short because I can go all day about this type of stuff. I have like pages and pages of notes that I wrote afterwards, but I'll give you three things that I thought stood out. So this is my lessons from billionaires. Number one, intensity is the strategy. So here's one of the things that happened at the event. We had, I think, five people who owned NBA teams at this event, which is crazy. That's like, I don't know, one sixth of the league. And we were like, "What's the hardest part about owning a team you didn't really anticipate before you bought it?" Right? You've been a basketball fan your whole life. And he was like, "Well, the hardest thing is that here's a guy on my team who's got a 5-year, $150 million deal guaranteed. So he plays good, $150 million. He plays bad, $150 million. His knee feels sore, he's got a boo-boo, he wants to sit out, $150 million." And he's like, "It is very hard to lead an organization where your upside and your compensation is guaranteed regardless of performance." And he goes, "In my life, I'm on a day-to-day contract with myself. That's how I've always been."
Let's fast forward about an hour. Now, people have broken up into smaller groups and two rich guys in the corner are talking and I think they're about to get in a fight. They're talking so loud and so passionately. They're like nose to nose almost. I'm like, "Oh [__], I got to get over there." So I walk over. I'm like, I don't know what to do here. Turns out they're not fighting. They're just both so passionate about this one idea, which is about living in the details. So one of the guys was an NBA team owner named Matt Ishbia. He owns the Phoenix Suns. He also owns one of, if not the largest mortgage company in the country. So he owns United Wholesale Mortgage. You know, he basically took over this business from his dad. It was like his dad's side hustle and had 12 employees when he joined it and probably did, I don't know, like single-digit millions in revenue maybe at that time. And you know, that was, you know, whatever, 2004 they did like 45 mortgages, you know, not huge volume. 2005 still slow, 2006 still slow. Then 07, 08, 09 it starts to take off because other mortgage lenders during the financial crisis, the subprime mortgage crisis, they went under because they were writing bad mortgages. He was not. And so they picked up tons of business. So they grew literally 10x in those years and grew and grew and grew. So now they do like, I don't know, over 200 billion in loans, two billion a year in profit at the company level. So he's one of the wealthiest, you know, 50 wealthiest people in the country at this point.
Was his dad's company big or was it like... was it a subsidiary within a successful company or he...
No, it was just his own 12-person, you know, side hustle.
Dude, that's crazy. I feel like there's also a bunch of different basketball or sports teams owners who are in the mortgage business.
Yeah, Dan Gilbert also is in the mortgage business. I don't know if there's any others, but there definitely those two. And they're rivals. So he's talking to this guy. So I walk in and I think they're about to fight. They're not fighting at all. They're both just passionate. And they're both talking about, "Dude, you got to be in the details." And it's kind of like a... And so he said this story that I thought was really great. One of the things is if you weren't on the private jet, we tried to get you on one of their private jets on the way out. And so my buddy Raman got to ride with him on the way home. And I was like, "What's the story?" He goes, "Dude, I walk the floor of my company every day." I think his company has like thousands of employees, maybe 10,000 employees, something crazy like that. So he says, "I walk the floor every day and I'm looking for three problems." And what he means by that is he talks to everybody, like entry-level people, the janitor, the senior executives, whoever he bumps into. And he's just trying to find who's got a problem that's blocking them from this company being more successful. Like where are bottlenecks? And he's just searching for it. And so he goes, "I'm trying to find three a day." He goes, "If I find a problem, then right there, I'll try to fix it on the spot." So, you know, I've talked to my sales guy. He's telling me about a problem with the IT system. We called the IT guy. We're like, "Hey, this guy's got a problem with the IT system." And the guy's like, "Okay, I'll look into it. Thanks." You know, he's like, "No, no, get off your ass. Like, this guy's got a problem. It needs to get fixed today." And the guy comes and fixes the problem. Now, all those sales guys don't have that IT problem anymore. And he's like, "I do three problems a day for 365 days a year. I'm solving a thousand problems that are stopping my company from growing." So if you ask how do you grow, it's you remove a thousand bottlenecks to growth every year. And I was like, that is awesome. I loved that.
Hey everyone, really quick, if you're enjoying this episode on CEO stuff, then I've got something for you. So the team at HubSpot, they actually went and put together a bunch of best practices that Sean and I use in our own companies, and they put it together in something that's really easy to read and understand. And so if you want to just save yourself 10 years of headache and heartache, then you should check it out. I wish we had this a long time ago. It would have helped me a lot. But there should be a QR code on your screen that you can scan or a link in the description. So check it out. It's totally free and totally awesome.
Did he talk like that just talking to one other guy?
Yeah. So the other guy was basically saying kind of the same thing about how he lives. He's like, "Bro, I'm so in the details." And there was an "I'm so in the details" contest that they were getting into. And they were both loving it. They're like that because, you know, I think the perception of a CEO, of a manager, is that you're sort of this visionary 10,000-foot-level sort of thing. And what they were saying that works for them is that they live in the details. They're on the ground floor solving problems. And we do this other thing which is we do a store walk. So at night there's so many people there that have built big CPG brands that we wanted to... we're like, instead of just giving the talk, what if we just went to Walmart or Target. He just taught us about it there. And so now we shut down a Target at night. So after the Target closes, they hold it open for an extra hour and a half for us. We go there and we tour the Target and then basically it's like every aisle. It's like, "Oh, that's the pet food guy. Pet food guy, teach us about pet food." Hey, you know, Jamie from Ring was there. He's like, we're in this home security aisle. "Jamie, tell us the story of Ring, but standing in the Ring aisle holding the Ring product. Tell us about this."
Hey, this guy dominates the board games category. Eight of the 10 bestselling board games in the world are his. Tell us how the hell that happens. And he's like, "Look, check this out." He's like, "You know, they're so bad at restocking our games." He's like, "Check out." He rips the panel open underneath the thing. He's like, "They... like for games, they don't restock in the back. They're just down here." He's like, "So I will crawl under here and pick this up and put this back and restock this myself."
And so, you see the scrappiness of people who...
are literally like making billions of dollars. And I just thought that's like at odds with what I think, which I think how most people view the role of a CEO.
So intensity as a strategy is interesting. Let me ask you if you've noticed this to be true or not. I often wonder, do you think that they were intense when they were in their 20s on the come up or are you just... the intensity and sharpness dial up the more you progress and the bigger opportunity you see that you maybe didn't actually think was big but you kind of fell into? For example, there's this famous one of Jeff Bezos's famous pitches was he was like, "Man, I think if we kill it, we're going to be... this is going to be a $100 million company. It's going to be pretty big." And then like as the opportunity opens up, like did the intensity dial up or was he already intense?
So I think like with most things in life, it's if you go to the people at the top, it's always the combination of nature and nurture, right? It's the talent times the ability to exploit the talent. And so, you know, there's nobody up the top who's just totally talentless. So, you know, they didn't get there with zero intensity. So for example, with Matt Ishbia, he was a, you know, he's a small white guy who basically was a, you know, bench guy at Michigan State basketball, which is like the most hard-nosed, grittiest Big Ten college basketball team and program under Tom Izzo. And so he's like, he even said it during his talk. He was like, "Look, if you guys saw me on the court today, like I'm not the most talented guy, but I've always been like this mentality of I'll outwork you." And I wanted to clarify one thing. So like it's never one or the other. So when I say intensity as a strategy, that doesn't mean they don't have any strategy or vision. It means like all of one or the other wouldn't work. So if you're all vision, no walk, right? You're not down on the floor at Target getting the stuff out from under the shelf. Like that's not going to get you anywhere. If you're only restocking the shelves and you have no vision, you have no key insight, it's also going to get nowhere. It's the combination that makes you dangerous. And so for example, the guy who does it with board games, Elon, who came on the podcast, he had the right vision at the beginning, which was we're going to make games and the game is not fun. The game helps the players be fun to each other. Right? So he got the right big idea, which was how do we make games where the game itself is not fun, but the game makes the players fun. So when they're acting it out in charades, it's not that the card of charades was fun. The card of charades let you be a fun or funny person. And that's the secret. We're going to be the best in the world at that. And then, you know, and then we pair it with the scrappiness. Same thing with the United Wholesale Mortgage thing. He had like a strategy which was different than everybody else. Most people like Rocket Mortgage, they sell mortgages to the end customer, right? Like you need... you're buying a home, come buy it with us. What he did was different. He's like, "Look, there's all these mortgage brokers out there. What if we sell wholesale to them? Then they win, but they become our sales channel. And all of a sudden, there's 33,000 of those guys in the country. We turn them into our salesmen for us. That's our sales fleet." And he had very simple metrics. He's like, "Cool. We think that brokered mortgages is going to become a third of the market, and we think we can get to 50% market share of that. If we do those two things, we're the biggest mortgage company in the world." Right? So like a simple two-sentence level of clarity about like what the hell do we need to do and then everything else is just intensity at that strategy.
I have a bunch of questions about that, but do you think that owning a basketball team is sort of like owning a house where you like dreamt of it and you finally get it and you're like, this is a pain in the ass. I want to rent like...
Well, there was like a guy there who's a minority owner and I was like, yeah, that's the way to do it. Because the minority owner, yes, you don't have the control, but...
He only goes to games when he wants to.
And he can say that he owns it.
Chime in and feel like an owner, but he doesn't have like all the headaches.
Whereas like the other guys, you know, they're going to every single game, you know, regular season Tuesday game against Charlotte and you're, you know, you're in town for that. It takes over your life completely. And for some of them, that's exactly what they wanted. For me, I probably wouldn't want that, you know, that version of it. There's other ways to have it.
Poor guys. No, but you give yourself a job, right? Like you have total freedom at that stage and then you give yourself a job. So it is in a way poor guys. Now they're not... they don't feel that way. They like that job. They chose that job. But it is no doubt a job.
One time I got to go... it's so funny. I participated in this charity thing. My buddy has this thing where he and I participate occasionally to help inmates get jobs out of prison. And it's like a universally loved foundation. And one time I went to Indiana State Prison. And I was sitting next to this guy just like talking as we were like... it was 20 of us outsiders getting ready to go to the prison and talk to these guys. I didn't know who this guy was. I was just talking to him and talking to him for a little bit longer. And then eventually it came to like, so what do you do? And he's like, oh, I own the Pacers. And I got to go to the game with him afterwards that night. We went to the game with him and seeing him walk around the stadium of his team was the best feeling ever.
Restaurant owner energy times a billion.
It was restaurant owner energy times a billion. It was the coolest thing I've ever seen where I'm like, "Have you seen Napoleon Dynamite where the lady's looking at the little ship in a bottle and she goes, 'I want that.'" That's how I like whispered. I was like, "I want that."
It was awesome. It was so cool. All right. What's the second thing?
All right. Second thing would be culture is an action word. So one of the things I was like, you know, I'm looking up these guys and I'm thinking, what do they do better than me? Where can I steal from their game? Where can I notice some delta, some difference? So obviously intensity is one where they have this sort of psychopathy-like enjoyment of being a maniac in the details. Great. That's one. What's the second difference I noticed? The second difference...
Not all of them are psychopaths, by the way. I hang out with Mario a bit who went... Mario, who's one of the founders of Oscar, which is like a four or five billion dollar publicly traded company. Not psycho at all. Have you talked to him?
Not at all. He is technically brilliant and the CTO, and I think the CTOs and the technical brilliant people...
They have a slightly different like superpower that they're bringing to the table.
But even guys like Jesse Sler, who I think went this year or has gone previously, he's like a pretty nice calm guy. He's a psycho just like in being calm. Do you know what I mean?
He's like an adventure psycho.
Yeah. So he still has a little bit of that psycho, which is funny. Okay. Sorry. Go ahead.
Oh, Jesse, what do you do for leisure? He's like, 100-mile races.
You're like, "No, no, he's cool. He's chill." All right. So culture is an action word. Okay. So I think for most companies, culture is just a, you know, a set of generic words that are written on a wall that nobody remembers and definitely nobody's using in their day-to-day action. And I think that probably... what if you look at the companies that I thought had the most unique outcome, most unique output of what they make, right? What is the unique input that leads to that? So Jesse Cole was there. Jesse Cole from Savannah Bananas. We had him on the podcast, you know, unbelievable story. He made minor league baseball essentially, right? Like something that almost like in the dictionary definition nobody gave a [__] about and now has like a 3 million person waitlist for tickets, sells out 80,000 person stadiums, has more followers on social media than every other baseball team, including the Yankees combined. So, you know, obviously has done something magical with the product. So what's the magical input? All right, so he's telling the story. So this story was very inspiring to me. So he goes, "Okay, the CEO, the founder has some vision of how we want to deliver this magical, wonderful A++ customer experience, but how do you get... if your experience is in the hands of, you know, some new guy who joined 9 months ago and, you know, is getting paid a modest salary and, you know, they've never worked in an environment like this, how do you get them to care the way you care?" It's very, very hard, right? I think this is like the biggest challenge. I once met the founder of Chipotle and he said, "Oh, you're going into food service. Anybody in food service can make a billion dollars if you can figure out how to get a minimum wage employee to treat the customer as if it's their guest." And, you know, so that's like the mindset. Okay. So how did he do it? So he goes, you got to show them, not tell them. He goes, so we have this value called, you know, you always plus the experience, meaning like whatever the experience was, we plus it the next time. So he goes, "This year our players were coming to like first day of minicamp." So before the season even starts, so they got all their players and he goes, "You know," he was thinking about it with his team. He goes, "You know, we want them to put on a show for people. We want them to know how special it feels to go to something. We want them to make the fans feel special, but we never make them feel special." He's like, "So here we go." He goes, "We have like, I don't know, he had like a week to plan this or something like that." And he goes, "We're going to turn their first day orientation into a show." And so he goes, "They get down from their, you know, they're at the hotel. It's, you know, we're going to report. We're going to go through orientation." So they're kind of like how anybody is for first day employee orientation, you know, player for first day player on the job. You're just sort of, you know, zombie walking through life at that point. He goes, they come downstairs.
The cars have been replaced by this like special bus. The bus is surrounded by a police escort. They're like, "What?" And he's like, "We're only going like 1,200 feet away, but you have a police escort to go from here to there because you are special. You are a star, and we're going to treat you like a star." And he goes, "As they start going with the police escort, all of our headquarters staff and employees, we're outside. We're cheering. We got signs." He goes, they get there. They come out of the bus. Boom. Fireworks go off. We got fireworks going into the sky. We start singing the song to them. They're being serenaded by us. They walk through the aisle. They enter the stadium. In the stadium, we have the motivational video on the screen. They're seeing themselves as kids when they were baseball players and now they're grown up. And the story is telling them is that you made it to the big show. You are here. And he's like, he tells this story about how he fired up his players and how they were like, what just happened for their... and there's no fans. No customers are even at this. This was how he trained his employees basically. This was just how he welcomed his new players. And he goes, you think after that they're going to walk a little differently for day one of doing their job? He's like, of course, of course they will. Of course they now know what we mean when we say you put on a show, you plus the experience, all these values. Like you got to live it, you know, if you want them to live it. And I was like, I had goosebumps, dude. It was awesome.
