Jay Samit on the Keys to Radical Disruption | Impact Theory

Jay Samit on the Keys to Radical Disruption | Impact Theory

September 14, 2019 100 By Ewald Bahringer


Tom Bilyeu: Everybody, welcome to another
episode of Impact Theory. You are here, my friends, because you believe
like I do that human potential is nearly limitless, but you know that having potential is not
the same as actually doing something with it. So our goal with the show and company is to
introduce you to the people and ideas that will help you actually execute on your dreams. Today’s guest is a freakishly accomplished
entrepreneur who started his insanely storied career by inventing airport kiosks and music-based
video games. You know MVD. And that is just the tip of a very large iceberg. I assure you, even if I speed read his full
list of accomplishments, it would take me an hour. It’s nuts. So let me just say this: He’s built and sold
many of his own companies, held senior management positions at Sony, EMI, and Universal Pictures,
taken an equity stake in 80-plus companies, raised roughly $800 million for start-ups,
helped grow multi-billion-dollar juggernauts such as LinkedIn and eBay before they even
IPOed, and helped transform entire industries and revamp governments. Because of his unprecedented track record
of success, everyone from the Pope to the President have called on him for advice on
how to harness the power of positive change. His recent book, Disrupt You, grabbed a hold
of my brain and refused to let go. Not only are the ideas brilliant, but his
words drip with the credibility that only comes when you’ve been a soldier on the front
lines. And his success on the front lines has made
him one of the most sought after advisors and speakers on the planet. He’s a contributor to the Wall Street Journal
and host of his documentary series Wall Street Journal Startup of the Year. And he frequently appears on ABC, NBC, Bloomberg,
and many others, as well as teaching innovation at the largest engineering school in the country. He’s also helped develop disruptive solutions
for such global brands as Coca-Cola, Disney, and Microsoft. So, please, my friends, help me in welcoming
the best selling author and monolithic entrepreneur who started his first company because no one
would hire him, the dyslexic master of disruption, Jay Samit. Jay Samit: Thanks for having me. Tom Bilyeu: What a pleasure. Jay Samit: Too kind. The words were too nice. Tom Bilyeu: Thank you for saying that. It’s very humble. But, honestly, your book really freaked me
out, and it stopped me in my tracks. It ended up changing the whole way that we
do our book reviews now because I was freaking out to everybody about your book, that every
entrepreneur needs to read it. I’ve listed the 25 books you have to read. It’s going on that list. So when I did the book review, people were
like, “You didn’t capture that same sense of enthusiasm.” So now they’re all free wheel and just me
sort of going into the meat because your book is transformative. Truly, I mean that. We’ll get into some of the details, but the
one thing I want to start with, you grew up dyslexic. Jay Samit: Yeah. Tom Bilyeu: And when you graduate from college,
it’s one of the worst job markets ever. This is probably my favorite story. Instead of going and just giving up, you start
your own company, but you do it in a super unique way. Jay Samit: It was the time when Star Wars
had just come out, changed Hollywood. Special effects, this new great stuff. What I wanted to do when I got out of college
was I wanted to make special effects in movies like that. A couple of minor problems: I knew no one
in Hollywood, I knew nothing about how to make special effects, and I was broke. I realized no one’s going to hire somebody
that doesn’t have experience. You’re competing against people that do this
for a lifetime or whatever. So I printed business cards for $1, and I
made up a fake company, Jasamit Productions, Jay Allen Samit, and it’s mine. But I didn’t make myself head of the company. I just myself a lowly job. Tom Bilyeu: See, that’s the part that freaks
me out. How’d you get that insight? That’s so smart. Jay Samit: The other thing that I had done
at the same time is I knew where I wanted to work, but I didn’t know how you got a foot
in the door. So I ran an ad, back when there used to be
newspapers, you ran a physical ad, describing the job that I wanted. It was a blind ad, it didn’t say what the
company was. Then I got a bunch of resumes in, and that
told me a bunch of data. One, it told me what type of resume could
get that job, so what would I have to do. Two, it told me people that worked somewhere
that had one foot out the door, so I now knew a list of companies that would have openings. Then I regurgitated how to frame what I could
do in that language and apply it to these people who didn’t have jobs yet, and that’s
how you get a job. Tom Bilyeu: Let me put you in my shoes now
for a second. I pick your book up, I have no idea where
it’s going to go. Good reviews. Thought “Okay, let me give this a shot.” I start reading, and we get on to that story
about how not only did you not just give up, that you make a business card. Not only that, but you were smart enough to
make yourself a low level employee. Not only did you do that, but you had run
an ad to identify people that were leaving their job. It’s just like … There are few people that
make me go, “I’m just not smart enough to be this person.” It’s so insightful
Jay Samit: It’s not smart. Here’s the thing. Everybody and probably what draws people to
your show and why your show’s so valuable, is people have problems in their lives. Most people sit there and dwell on the problems
or they relive yesterday. Every day you spend living yesterday’s problem,
you’re giving up your future. It makes no sense. But if you say “I have problems. Am I unique? Am I the only one that has these problems?” And the answer probably is “No.” So find a problem that a lot of people have,
solve it, and that’s all that being an entrepreneur is, that’s all that a business person is. The more problems that you have in your life,
the more successful you’ll be. Tom Bilyeu: I love that. Jay Samit: I had problems. I had two sons very early, and I’m like, “They
got to eat. I got to eat. I got to provide for my family.” How do you solve the things? What piece of information do I need? Let’s do the modern version of the whole thing. There’s no more newspapers, what do you do? I tell the story that a young man wisely did. It’s a guy who got his job out of college
at the bottom of one of these multinational ad agencies. Layers and layers of stuff. He’s doing mindless stuff. He hates every day in his cubicle. He wanted to do creative stuff. So he realizes there’s some big famous creative
directors at the tops of these agencies. He’s Googling one day, and he realizes nobody
bought their names as keywords. So he just put “I want to work for you” with
a link to his portfolio and bought the keywords of these five most famous guys in the industry. Three out of five called him. Tom Bilyeu: Because of Googling themselves,
right? Jay Samit: Right. Everybody Googles themselves. Got job offers and accelerated about 20 years
of his career. It’s that easy. By the way, his investment was more than mine. He spent about $9. Tom Bilyeu: Wow, so he really went broke doing
it. Jay Samit: Yeah. Tom Bilyeu: Right, yeah. Big investment. Jay Samit: So I’ve been very lucky. You wake up, you’re a kid of normal means,
and dozens of your friends become billionaires. We weren’t brighter, we didn’t go to the right
schools, we didn’t do anything. What happened? The world changed. Well, the world’s continuing to change. We have self-made billionaires in their 20s
happening almost monthly. They have the same 24 hours in the day that
you and I do. What are they doing differently? What are they doing that can be learned from
and copied and emulated to solve a different problem? And if you’re not motivated by money, how
to use these same tools to change the world? Because the world’s got problems. Tom Bilyeu: Yeah, no question. You’ve said that it takes nothing more than
insight and drive to be successful. Then the question that like screamed out of
my mind was can you train to be more insightful? Jay Samit: Absolutely. Tom Bilyeu: All right. How do you do that? Jay Samit: Here’s a simple exercise for everybody
watching. I guarantee you that 30 days from today, from
when you watch this, you will have more deal flow than any venture capital firm in Silicon
Valley. Take a piece of paper, and today, write three
problems in your life. I hit traffic this morning. I forgot to take my medicine. Whatever it might be. But do this every day for a month. Because what you’re going to find is first
day, it’s kind of easy. Maybe the second day. But after that, you’re like, “Okay, I wrote
down my problems.” So what else is a problem that you aren’t
identifying because you’ve accepted that’s the way it is. That’s the way it’s always been. You work at a big corporation. “Well, this is the way we do it.” Well, you’re going to go out of business doing
that. Then, when you have those 90 ideas, what are
you passionate about and what affects the most people? The intersection of those two. In your life, you were passionate about nutrition,
that it could change people’s lives. And you saw a way that you could financially
impact them with a healthy bar. Those intersections led to success. Your insight got you there, and you solved
for a whole bunch of people. No one sells a product, no one buys something,
no one went into a store and bought a 1/4″ drill bit because they wanted a 1/4″ drill
bit. They wanted a 1/4″ hole. Right? Tom Bilyeu: Very well said. Yeah. Jay Samit: Somebody made the drill bit because
you wanted a hole. So fill those holes. That’s as simple as it can be. Tom Bilyeu: Do you still do that today? Do you keep a list of problems that you encounter? Jay Samit: All the time. I’ll give you examples of ones that I’m working
on right now for clients. I’m obsessed with augmented reality and virtual
reality, and it solves problems that couldn’t be solved before. It can connect people in the field to experts
somewhere else where they can see what I’m seeing and all that. Working with an overnight package delivery
company that just adding augmented reality glasses can save them 30% of their jet fuel. Tom Bilyeu: How? Jay Samit: There’s a whole bunch of people
who have the job. You ever sit on a plane and see the metal
container that they slide in that curved thing? Tom Bilyeu: Yeah. Yeah. Jay Samit: There’s people whose jobs are to
throw packages into that container. It’s a high turnover job. It’s not a fun job. If you’re not good at it, about 1/3 of that
container is going to be air. If you’d been doing it a bunch of years, you
can pack it tighter. If 1/3 of each container is air, that means
one out of three planes is flying empty. That’s a ton of jet fuel. That’s billions of dollars a year. What if you can turn it into 3D Tetris? What if it’s a fun game and you can bonus
people based on performance and doing well and doing it. Now, you save the environment, you make the
company more profitable, and make the job more fun, and you allow those that take pride
in their work to take home more money. Tom Bilyeu: It’s a fascinating approach. I love that. But coming back out for a second-
Jay Samit: Sure. Tom Bilyeu: This comes down to the game that
my partner and I were playing that ended up leading to Quest, the same game that I played
that ended up in Impact Theory is “No bullshit, what would it take?” So no bullshit, what does it take to … In
the case of Quest, it was no bullshit, what would it take to help my family be happy? I wanted to see them happy, and I just knew
that the body was part of that equation. At Impact Theory, the question was no bullshit,
what would it take to end, what I called, generational poverty, which is about mindset. It’s not about money. And the answer was very clear. I want to leverage behavior, I don’t want
to change it. So the behavior that we need to leverage is,
and this is my stance, if narrative is the way that people assimilate truly disruptive
information, then we know that we’re going to be dealing with narrative. I think you’ve got books, comic books, movies,
television, video games, that sort of the arena that you’re playing in. So how do we leverage that to actually inform
the next generation of entrepreneurs? That, because I think commerce at the end
of the day is the way that you’re going to bring in to the real world the change that
you’re having people assimilate? That is that loop. That was us playing that game, and it sounds
very similar. If you’ve got these, all the problems that
you have every day, and let’s take one that you’ve talked about before, and the problem
is traffic. I don’t want to sit in traffic anymore. You play the “No bullshit, what would it take?” Okay, I need to know where cars are actually
going. I need to be able to dictate where they go
so that you can basically distribute the traffic, which ended up being ways essentially-
Jay Samit: Right. But the insight that they had was, right,
I’m sitting in traffic. The phone company knows that my phone’s here
and your phone’s there. If they can tell your phone to go left and
mine to go right, there’s no traffic. That was the insight. And a lot of people go, “Well, you’re talking
about tech stuff. I’m not an engineer.” How many lines of code did Steve Jobs write
in his career building the world’s biggest tech company? Tom Bilyeu: Zero. Jay Samit: Yeah. So we all live with technology. But you bring up a bigger point. What’s driving me right now? Our world is changing at a pace that most
people can’t grasp. Government’s definitely can’t grasp it right
now. That is if we go back 100 years ago, half
the people worked on farms, and half the people worked in cities. And two pieces of technology: irrigation and
the tractor. Today, we have 2% of the people making food
for all of the US and exporting. That means half the people lost their jobs
on farms, but they were absorbed by the Industrial Revolution. So we live during a century where we saw a
half of the jobs disappear. Now we’re living in a time where over the
next 10 years, half of all jobs will disappear. Robotics replacing unskilled labor. You raise minimum wage to assemble a burger,
a robot will assemble a burger, a robot will make a pizza. An app will take your order. White collar jobs, half of middle management
jobs over the next five years are going to disappear. Number one job on tax returns is truck driver. Eight percent of the population drives a vehicle. Autonomous vehicles, those are gone. Autonomous boats. Everything. 3D printing, et cetera, et cetera. So even your professionals, AI systems and
machine learning get rid of a lot of lawyers, a lot of doctors, a lot of accounting. What do you do with all those people? What makes life enjoyable is a stable middle
class. So no bullshit, how do you solve that? How do you build a big middle class? The same technology that is automating away
those things that were mundane and don’t need to be repeated connects us to billions of
other people. So you can now solve problems that scale much
quicker. From 2008 in the recession, all of the job
gains globally have come from entrepreneurs. They haven’t come from big business. So how do you teach people to start companies? How do you get people to replicate your journey? It can be in almost any field. If you have a life with no problems, yeah,
there’s nothing to do. Tom Bilyeu: Let me ask you a question that’s
going to draw a line for people. Do you plan to monetize that or is this purely
philanthropic for you? Jay Samit: The goal isn’t for me to monetize. I’ve been very lucky, and life’s good, and
the kids are good. I didn’t write the book to make money. I did it to scale … I was teaching how to
build a high tech startup. I taught. The most successful was two students did $150
million in top line their first year. Tom Bilyeu: Good lord. Jay Samit: Yeah. Makes you really feel like a failure. Brilliant idea. One of the best pitches I’ve ever heard. I judge hackathons around the world, and I’m
turning the hackathon experience into a TV show to teach people how to do this because
let’s go from the selfish standpoint. If all an entrepreneur does is solve problems,
who are they solving them for? Everybody else. I have problems, I would like a better world. So the more people that are solving problems,
the better life is for everybody. We were taught that there was like only so
many slices of pie, and it’s mine or yours, a zero sum game. That isn’t how the world really works. That isn’t how capital is created. You create a new company, and somebody buys
stock for $10, and somebody else buys stock for 20, you’ve now created a whole bunch of
money that didn’t exist in the system. People don’t realize money isn’t all printed
by a government. Entrepreneurs actually create money. Bitcoin created a new currency that may end
up being more trustworthy than any nation-state currency. It’s an amazing time to be on the planet,
so if I can help people achieve that success … Take it on the simplest. We’d love going to a movie that cost $200
million to make, back to the Star Wars thing. I love living in a world where somebody’s
willing to spend $200 million to entertain my ass for two hours. It doesn’t get better than that. Tom Bilyeu: The reason I ask you about the
path to monetization is I think one of the things … It’s the middle ground that people
get lost in. You can show people that, hey, I used to be,
what I say, I used to have a slave mentality. I kept my head down, did as little work as
possible, and avoided punishment at all costs. Then I can show you that I was very, very
successful. But people don’t get to see that in-between. And what I think you’re doing just amazingly
well, and what people will get in the book, are literally the things that you have to
do to your mind, the ways you have to think, the sort of baseline belief systems you have
to bring on to your own life that are going to allow you go take this grand idea … If
I want to build a massive middle class, maybe you’re not thinking of that particular problem
this way, but you can take whatever your grand problem is, and then how do I create an ecosystem
around it that’s financially self-sustaining? And allowing people the things that they need
to do to their mind to create a real business. Jay Samit: When you read Disrupt You, I’m
putting you on the spot, was there anything that I said or laid out in those chapters
that after the light bulb went out and you go, “Wow, I never saw I that way” that you
didn’t instantly absorb and say “Oh, yeah, this makes sense”? Tom Bilyeu: I kind of know what you’re asking. Yes, there were things that were watershed
moments for me, which is why I think the book is so important. But they were in hindsight, self evident. Jay Samit: That’s the point. None of this stuff is not common sense. It’s just we were pushed down a path of blinders
our whole lives. For well-intentioned reasons in many cases. But the educational system was designed to
have you work at a factory. The IQ test was invented to let the Army know
which people were cannon fodder, and you could just let them get killed, and which people
had potential. When in fact, we all have potential. What we have to do is figure out where to
channel it and what are those steps. There’s no gatekeepers to capital anymore. There’s no exclusive country club or college
or this or that. And we’re all interconnected, so it doesn’t
matter whether you’re in a big city or in Botswana, you can still reach six billion
consumers. So what’s stopping you? That fear of failure. That “Oh, if I fail what will people say?” Failing’s a great thing. Failing teaches you what doesn’t work. Failure is throwing in the towel. You take that job to be secure, you go for
that big Fortune 500 company, and most of the Fortune 500 companies go out of business. There’s less than 10% of them left. That’s amazing statement. Of the original list. Tom Bilyeu: Yeah. No kidding. Jay Samit: So it’s not the security that’s
robbing ambition, it’s the illusion of security that robs ambition. So the biggest risk you can take in life is
not taking one. If you’re at that point where you’re in the
middle of your career, and you lost your job, or you’re just out of college and starting,
or just out of high school, go talk to a senior citizen about what they really regret about
their lives. It’s not what they failed at. It’s what they didn’t try. It’s the regrets of “Why didn’t I?” If you try something and you fail, you learn
a skill set for something else. Steve Jobs, a great entrepreneur, college
wasn’t for him, he bounced around, but he audited and took a class in calligraphy. It’s useless. What’s the point of that? But when it came the time of the birth of
the PC, and IBM had all the rational ways to make a good machine, he remembered that
calligraphy course and said, “We’re going to have fonts on our machine.” One divergent of “We got a few fonts here,
and these guys only have one,” graphic artists are using this machine. Adobe, the whole future music, the iPod, the
iPhone, all come from one calligraphy class. Tom Bilyeu: What’s one of the most important
things you hope people take away from the book? Jay Samit: That all of the big famous people
that you hear about, Richard Branson and Steve Jobs and Zuckerberg and everyone, they’re
no different than you are. Seventy-something percent of the world’s billionaires
are self-made. You can achieve this. It’s not going to be easy. You don’t just wake up on Tuesday and become
rich on Wednesday. But it doesn’t take any more effort than going
to a job that you hate. And unless you believe in reincarnation, you
got one shot on this planet. One shot. So don’t you want to make a difference? Don’t you want to leave something behind and
make the planet better than you found it? Why are you here? What do you want to accomplish with your life? It doesn’t have to be [inaudible 00:21:31],
and it doesn’t have to be money-oriented. The same principles that disrupt you, you
can change the educational system, you can change healthcare. I am humbled by what I’m seeing people create
around the world with so little. But we are on this ball together. We can solve problems together. We can make a better future together. It’s an optimistic story that you get to write
your piece of the story. Why wouldn’t people want to push their potential? Aim for the stars. If you don’t make it all the way, you made
it to the moon. Not bad. Tom Bilyeu: That notion of solving these problems
together, I think is exactly what I took away from the book. Or at least problem solving in general, and
that’s one of the things I think people, when they read the book, they’re going to find
example after example that will light them on fire. I’ll give you a few of my favorites. I’d love some more color or how people can
get better at this. When you first start, you think “Oh, man. No brainer. I’ve got this device that’s for the lottery.” Right? Jay Samit: Oh, yeah, yeah. Tom Bilyeu: So you’ve got the old school lottery
thing. It’s those ugly, sort of green, one color
dot matrix-y looking thing. Then you had this display panel, this beautiful
… It could talk if I’m not mistaken. Jay Samit: Yeah. Got to go back before we all had PCs, before
computers were everywhere. I’m that old, yes. Lotteries were coming out to different states,
and they had a little thing with the little just green numbers that you type in, and then
it prints your ticket. There was a contract for California. We had a six-foot-tall machine, big color
screen, a motion detector. Again, this is 1980s. You walk by in the supermarkets, “Psst. What would you do with $1 million?” And you’re looking around because nobody every
talked to you before. This machine could should you the cars and
the yachts and all this stuff. And you could touch. Oh, and by the way, it said “Touch me” in
six different languages, if I remember correctly. So if you only spoke Vietnamese, boom, now
the machine does it. You could make your own things. And I’m now going to go for the biggest contract
in my life. I’m in my early 20s. Every penny I have is into this. I’m up against a company that has this little
green thing. I’m as cocky as can be. This is it. I go to this meeting, I win the contract,
I’ll be a millionaire, life is good, dah dah dah. Two fun things that maybe I didn’t elaborate
in the book. Didn’t get the contract. Turns out the FBI had a secret camera videoing
in a hotel room where somebody, a state Senator named Alan Robbins, took a suitcase of $50,000
to vote for the other guys. Even though the FBI sent him to prison, and
that’s all true and fact, they didn’t invalidate the awarding of the contract to my competition. Tom Bilyeu: That’s crazy. Jay Samit: Now I’m flying back to LA. I didn’t know how to raise money for my first
company, so I had like 10 credit cards all maxed out. I can’t pay them. I don’t know what I’m going to do. I don’t even have enough money to take a cab
home from LAX. I’m trying to figure out the bus system in
Los Angeles. Public transportation, not our strong suit. They used to have, back in the ’80s, these
nice counters manned by volunteer little old ladies that would tell you how to get a bus
or a cab or a van or a hotel or anything. Of course, by the time I got back, there’s
nobody there. I go, “Wait a second. If she was there, she could only speak English. She would only know a certain amount of information. There’s visitors from tons of languages. Why don’t you put a kiosk here? Why don’t you let people get all the information
and have live data?” This is before the internet and before smartphones,
before any of that. Today, when you go through an airport, everything
you do is with a kiosk. My back was against the wall. I didn’t set out to do a kiosk there, and
most of my early successes were somebody else developed a piece of technology that didn’t
hit its mark, and I’m going, “Oh, wow. They got $100 million into making those laser
discs, and nobody’s buying them for their home. They’re interactive. That’d be good for corporate training. Let me go sell that to Ford. Let me go sell that to this one and that one.” So I started realizing that it wasn’t the
inventors of technology, it was the people that brought them to market. I have the skill set to do that. I just have to figure out what something and
move it somewhere else. That was the genesis of a whole life where
I suddenly look back one day and go, “Wow, I came how far? Doing what?” Tom Bilyeu: Yeah. I had this sense. I’m reading the book, and I have this sense
that I started to envision myself walking through the world pushing piles of cash out
the way to like get to whatever stupid thing it was that I was trying to do. Because every story you would tell would start
with, like that one, where it was abject failure. You’re in the airport and now no longer have
enough money to get home, but from that comes your first massive success. Jay Samit: Yeah. Tom Bilyeu: Then there was another story where
you’re doing music, you’ve got this whole great idea for launching this new digital
service, nobody’s going for it, and you come up with the idea of the concert in the sky. Jay Samit: Yeah. Didn’t come up with the idea for concert in
the sky. Back to failure. Richard Branson who’s launched eight billion-dollar
companies. He’s launched about 300 companies. The most genius thing that Richard ever did
in hindsight was his brand is Virgin, which means you’re a newbie, you don’t know what
you’re doing. So every company of his that fails only strengthens
the brand. He’s not afraid to try. Virgin Cola. Oh, the other guys have every piece of distribution
on Earth? End of Virgin Cola. Anyway, he had had this idea of doing for
Virgin Airlines, a concert in the sky, but it’s against FAA rules to play an instrument
on an airplane. Tom Bilyeu: Really? Jay Samit: Yeah. There used to be an airline called MGM that,
in the upstairs of the 747, had a piano bar, and the other people couldn’t compete, so
they banned so that they can’t play an instrument. Because they could interfere with the electronics
and everything else. Anyway, I have to launch something up against
iTunes. I don’t have the same budget. They’re spending $100 million a year advertising. So I go, “Okay, who’s got problems? Let me look and see who’s got problems.” There were two companies that had bad years. United, one of the biggest carriers, was in
bankruptcy and was trying to come out of bankruptcy. And Spurlock had just done Super Size Me,
and McDonald’s sales were down. Great. Now I’ve got my partners. Now I just have to figure out how to make
what I want to do their priority and spend their money to launch my store. That’s the way I think. Tom Bilyeu: That’s brilliant. You’ve said that there’s no such thing as
not having money or running out of money or something like that. Jay Samit: Right. OPM, other people’s money. There’s somebody else who wants to reach the
same audience that you do. Most likely, they don’t have a new, fresh
idea. If you bring a fresh idea, they already have
it budgeted. So for McDonald’s we did a buy a Big Mac,
get a free track. A secret code on every Big Mac package, and
you get a free download from my store. But you have to register at my new store to
get it, so 20 million customers registered the first week. Because nobody does marketing, TV commercials,
in-store signage, and I held out on the contract for the tray liner, so when the kids are playing
in the Happy Meal Land, mom and dad are reading every line of “Ooh, I can get free music.” Amazing marketing partner. Amazing company. By the way, because I know you’re into health
and nutrition, if America wanted to eat tofu, McDonald’s would be the number one seller
of tofu. They know marketing. Then I went to United and said, “Wow. You have all these people who used to fly
with you that have enough miles, it turned out, to go back and forth to Pluto nine times. Let’s let them use their frequent flyer miles
to get music in the store. And to announce this, we’ll do this concert.” So I took out of my back pocket somebody else’s
idea that they didn’t execute. Sheryl Crow, 30,000 feet. Then we filled the plane with nothing but
journalists. Shot a nine-camera shoot, edited it on Vaio
laptops in first class, so when they got off the plane, they had an edited piece that could
lead the evening news. They painted the outside of the plane. This whole thing costs nothing. Not a penny. Tom Bilyeu: Didn’t it actually earn you like
$3 million before it even started? Jay Samit: Yes. One of the punchlines of it was McDonald’s
had done this great promotion for the Olympics that was in Los Angeles that every time the
US got a gold medal, you got a free french fries or free burger or something. And Russia pulled out, so we won all the medals,
and McDonald’s lost millions and millions of dollars with the promotion. So they took out insurance on all their other
promotions in case freak things happen. What if everybody redeemed, and the price
of this music was outrageous. After I got this signed off to do this whole
thing, McDonald’s says, “Okay, we have to get insurance for this.” I go, “Oh, yeah.” Everything’s printed, done, I’ve told everybody,
it’s about to launch. “The insurance in six million dollars, so
you got to pitch in three.” I don’t have three million. I can’t go to my boss and, “Oops, I made a
$3 million mistake.” That’s called career ending. So I’m like, “I’m screwed. This is over.” I’m like, “I got into something I don’t understand. I didn’t know.” Then I went through how do you solve a problem? The problem wasn’t three million, the problem
was insurance. I said, “Wait a second. What if we insured McDonald’s?” And they said, “Yeah.” So we insured McDonald’s, so they wrote me
a check for three million. Then I went to the board and said, “Yeah,
we just launched this thing, and we haven’t sold a single song yet, but we’re $3 million
in profits.” Tom Bilyeu: That’s amazing. I wanted to punch myself in the mouth when
I read that story. No, no, no, for real. This is one of those things that I really
want to know. I want there to be a process that I can use. Like here are the three things you have to
ask yourself at any moment of failure or something. That would be so useful. Because reading that, and this, I think, is
your superpower. It’s unbelievable the way that … Yes. It is how it felt to read it. In the book, he’s telling the story like it’s
happening in real time. I’m going to be the hero in the company, and
then, oh shit, the night before, “No, sorry, you own $3 million.” That’s where most people tap out, and they
have a story where they tell their friends they did this whole thing. “I lost my job because what am I going to
do? It’s $3 million.” Jay Samit: I hate … The modern version of
the dog ate my homework is when an entrepreneur says, “The company was really going really
well, but we couldn’t raise any more money.” No, that’s like you failed at raising money. You don’t know how to raise money. You didn’t go to people that could raise you
money. You didn’t tap everything. You didn’t try crowdfunding. Don’t say “Oh, well. We ran out of money.” Tom Bilyeu: Do you immediately go to “I need
money, but I don’t yet know where I’m going to get it, but I know that I have a problem,
somebody else shares the problem, and the solution would help us both. I’ll get them to pay for it.” Is it that sort of simple? Jay Samit: The other example was when I wanted
to sell training to Ford Motor. I’m 20-something years old. To shorten the story, I had a solution would
save them a couple hundred million dollars. I know nothing about cars. I know nothing about Detroit, Ford, the old
auto industry. I’m in California, and I’m in my 20s, and
it’s a very conservative, old fashioned, big manufacturing, dah dah dah. I’m trying to solve for how to connect the
dots. So put yourself in the other person’s perspective. I’m trying to think who does that executive
that I want to figure out who to meet, what’s their day like? What motivates them? What would get them excited? What would they spend time on? So I’m thinking this is Middle America, this
is corporate America, this is Americana, this is America, the old hot dog, Chevrolet, and
football type thing. This is Ford football. Well, I looked. There was a football coach from Michigan State,
famous coach, award-winning coach, who just retired. Easy to find him, call him up. “You’re my new head of sales.” He knows nothing about technology. All we had to do was go and get the meeting. They’d talk about the football game of such
and such, when the guy did the thing with the thing and dah dah dah. “What’s the kid here for? Okay, here. He’s got some business.” I kid you not. It’s that easy. LinkedIn was Reid’s way of turning that into
data. Tom Bilyeu: [crosstalk 00:34:18]
Jay Samit: You know somebody that knows somebody. We’re all connected. Tom Bilyeu: Why do you say he’s a smartest
person you’ve ever met? Jay Samit: He’s absolutely the smartest person. If you look at this original business plan
for LinkedIn, there’s 10 key pieces of data. Number of users for the first five years and
revenue for the first five years. If you overlay the actual, it looks like a
glove. He sees things in a way that’s farther ahead
than everybody else. Reid Hoffman was one of the first people to
mention to me this Airbnb idea. Really? I’m going to let people stay at my house? I don’t think so. I’m going to stay at their house? I don’t think so. Oh, I should’ve paused and said, “A, Reid’s
smarter than me. And B, it’s not about me. I’m not the demographic for every case.” Reid has invested and started so many successful
things since PayPal, and LinkedIn, and Kiva, and Zynga, and the first money into Facebook
and connecting the first investors. Just one of those type of people. Everyone should spend their time trying to
be around people that you feel are smarter than you. That doesn’t necessarily mean more educated. I’m no longer in the young whippersnapper
generation, so I have to spend a lot of time with millennials to understand the world from
their point of view because they have a huge advantage over me. Tom Bilyeu: Do you do that because you have
younger kids? Jay Samit: No. Tom Bilyeu: Or is there a way to systemitize
that? Jay Samit: That’s one of the reasons that
I teach at universities, and volunteer at hackathons, and try to work. Because we calcify as humans. What we do is we develop habits to free our
mind to do other things, so we don’t have to think about everything. A great example is when one of my sons was
looking for an apartment. We were driving around. “Ooh, write down that phone number. We’ll call. That’s a good building.” He takes his phone and goes like this. Wouldn’t have occurred to me. Yes, I have a phone. Yes, I know it takes pictures. Yes, I take pictures. But I have a habit that says “Grab a piece
of paper.” If you can break past the habits, you’ll find
that there are problems that young people are looking for that app because they assume
somebody must’ve already solved this. When they don’t find it, they then stop as
opposed to you may have been the first person to think about solving traffic with an app. And when you have a new field, AI, 3D printing,
augmented reality. It’s virgin turf. You don’t have to be the best. Here’s the takeaway: Be the best at what you
do or the only one doing it. Because if you’re the only one doing it, you’re
the best. That’s a lot better than competing. Tom Bilyeu: What are some classic mistakes
that you think entrepreneurs make? Jay Samit: Not delegating is the first one. Tom Bilyeu: Really? Jay Samit: The biggest problem people have
is the second person you hire is not going to be as good as you are at whatever it was. So what I try to explain to first time entrepreneurs
is you’re an A student at whatever that is, you’re going to have to hire C students. An A student gets a 90 on a test, a C student
gets a 60, but two of them get 120. Tom Bilyeu: That’s a great point. Jay Samit: So three of them are outdoing you
guaranteed, and you have to then figure out the systems. The second one is, and I was guilty of this
for at least a decade if not longer. I would leave meetings so frustrated when,
to the older generation, “Why don’t they get it? I am right. I am so right. What don’t they see?” I had this meeting at a major corporation
with the CEO that I got into, and I’m walking down the long hallway in ARMA New York past
IBM’s Electrics and IBM’s Electrics, typewriters on all the desks, realizing nobody in the
C suite was on PCs. I’m going like, “Ooh, this meeting’s not going
to go well. Because I’m living in a digital age, and they’re
in hieroglyphics.” What I realized was their job isn’t to get
it. They’re successful. Their future may be in doubt, but they’re
successful. You have to learn how to explain the future
in a way that people living in the past can embrace. That’s where change happens. Going in there, “You’re wrong. You’re stupid. You don’t get it.” Tom Bilyeu: I came across that part in the
book. I stopped and wrote it down verbatim. I’ll paraphrase it here. Their job isn’t to get it. Your job is to become so good at communication
that you can convince them of it. It was something like that. And I was like, “Oh, man. Those are words to live by.” Because it’s so easy, like you were saying
when people, the classic excuses, “Oh, I ran out of money,” “Business was right there,
but I ran out of money.” The same thing is, I’ve seen it countless
times in larger companies where people are like, “I have this brilliant idea, but they
don’t get it.” Like you were saying. When you take the ownership yourself, and
you put yourself in the driver’s seat, I think you get a step closer to what I think really
has made you so great and so successful, and this is certainly what turned me on so much
about your book, which is basically Ryan Holiday’s concept of the obstacle is the way. Jay Samit: It’s really amazing when you come
up with a big, hairy, audacious idea, a goal, something. You want to get me motivated, there’s only
one thing you have to say to me: “You can’t.” That’s it. Tom Bilyeu: That gets you fired up. Jay Samit: I’m like … It was funny. The editor of my book said, “You know, you’re
very competitive.” Because I never played sports, I go, “I’m
not competitive. I just have to win.” I never thought of myself as that. Then her other takeaway was “You know, this
is really a story about resilience.” And I’ll go, “I’m not resilient. You just don’t have any other choice.” The project and the changes that I’m working
on around the world, the governments that I’m working with to change their culture because
we have an advantage. We actually embrace failure more than any
other country. My generation, it was I Love Lucy or Jackie
Gleason would have the get-rich-quick thing. Your generation, it was Homer Simpson. He’s got this get-rich-quick scheme, it all
fails, and then life goes on. In the rest of the world, that life goes on
part isn’t part of the dialogue. So we’re a country that was made up of people
that came here overcoming odds for something better. That’s that basic pioneer spirit. Then at some point, we become a nation of
settlers that just settle for the way it is. We got to get more of that pioneer thing because
there’s so much abundance, and it’s not an us-versus-them. Everybody can benefit. Why wouldn’t you want that? Tom Bilyeu: Talk to me about education because
you said that we educate our youth like it’s a scarcity mindset. Jay Samit: It’s fill-in-the-blank, measure,
measure, measure that which can be measured. I’ll do something I’ve never done on camera. I cheated myself out of a good college education. I went to a great university, UCLA, but I
was so focused on getting into graduate school that the goal of those four years was how
do you get all A’s? The easiest way to get all A’s is to take
the easiest courses. So I worked with the athletic department and
helped their athletes, and in exchange, I got to take the classes that were set aside
for them, which instant A. But I never took the classes of what I wanted to learn, and
what would’ve challenged me, and what would’ve grown. So took that approach, and I’ll embarrass
one of my sons went to Brown. When he came to me and said, “Brown has no
required courses and no grades.” I’m going like, I thought of myself, I go,
“Oh, four years of partying.” Then I looked at it, and it’s a market economy. Think of it for a second. The English department only gets funded if
kids take the English courses. Geology only gets funded … No one’s required
to take any of them. So you’re only going to take the classes,
and there’s no grade, so no risk, that you hear are the most stimulated, most interesting,
greatest classes. So all the course and the quality of those
courses go up. As opposed to me taking rocks for jocks or
whatever simplistic thing that the person teaching it hated teaching it, and the students
hated taking it, but it was just a tick box. If you can get out of that tick box mentality
… So Brown’s completely changed the dynamic and made it a buyer’s markets where students
are the ones deciding which professors keep a job because if nobody takes the class, it’s
over. Tom Bilyeu: How important do you think a traditional
college education is today? Jay Samit: I teach at a university, and one
of the … Telling my students to drop out is not good for the university and not the
right thing. For most people getting into lifelong debt,
it will not be a financial advantage. That’s the truth. I have another son that did Princeton undergrad,
my kids are going to hate me for this, and Harvard MBA. Basically, it was “Dad, no matter what I do
in life, I’ll never starve because somebody will hire that.” I go, “You’re right.” It’s two lines that get you through the sorting
process. But that’s an individual choice. Not every path requires that. By the way, some of the most educated, brightest
people I know didn’t get a formal education. Khan Academy, everything. You can sit in front of that computer and
watch cats on a piano or the latest meme, or learn to program, learn a new language,
be a master of some discipline. You’re connected to mankind’s complete history
of thought. So you can self educate. But for some jobs and some of that filter,
you won’t get in the door unless they see that college degree. We actually have a gap right now where several
million openings of jobs in the US that require a college degree that there aren’t applicants
for. The whole sharing economy, genius. A car spends most of its time parked. Why own something that sits there? In my speeches around the world, the one thing
that gets people is I ask everybody, “How many people own an electric drill?” Do you own an electric drill? Tom Bilyeu: Yes. Jay Samit: In your lifetime, according to
the drill makers association or whatever, you’ll drill for like 12 minutes. Tom Bilyeu: That’s high for me, but …
Jay Samit: You got the new bookshelf. Dee dee dee. That’s it. If a drone could deliver it in the morning,
you do your thing and pick it up, you just rent it. Rent the runway was renting fashion. A woman had to face this horrible choice. Spend all her money and get that one beautiful
dress and then be known as the girl in the pink dress for the next 20 events. Or you could rent a different designer gown. Now that changes what’s being manufactured
and all that. So there’s so much opportunity. I’m like a kid in a candy store. Tom Bilyeu: What path do you plan to go down? What things are you pursuing? Is it ARVR? Jay Samit: I’m super passionate about AR and
VR. I think it transforms the workplace. I’ll give you a new way to think of how much
automation’s going to change things. Have you ever sat like we’re all little boys
inside and watched the big cranes on construction sites? Tom Bilyeu: Of course. Jay Samit: That’s a scary job. Some guy goes up there in the morning, sits
there with his coffee, reading, whatever. And at 10 o’clock, he’s got to move the thing
from here to there. Then at noon, he moves another thing. I’m not making fun of the job. They blow over, and they die. But the thing about it, he’s not looking out
the window moving the thing. He’s looking at screens, and there’s cameras. Why can’t he be sitting in a studio like this,
like a drone operator? Tom Bilyeu: Yeah, a great point. Jay Samit: Working on a crane in New York. Oh, they need to move something in Dubai? No problem. Oh, need to move something in Shanghai? Doesn’t have to be there. Telepresence is what VR and AR is all about. Tom Bilyeu: Do you know the XPRIZE? Jay Samit: Yeah. Tom Bilyeu: They actually have an XPRIZE coming
out called the Avatar XPRIZE exactly for that kind of thing. Jay Samit: Yeah. ANA Airlines, I think is the sponsor of it. Yeah. Tom Bilyeu: Yes. Jay Samit: Yeah. Peter’s a fan of the book, and I’m a fan of
his. We do a lot of the same things. Yeah, and what a great way … The whole concept
of the XPRIZE, of dangle a bunch of money for something that seems impossible, and the
more money you dangle, the more possible it becomes. Tom Bilyeu: Yeah. It goes back to what I think is your central
thesis, which there are all these problems. These problems are ultimately solvable, A,
and B, monetizable. That was the thing that drew me to the XPRIZE
is really looking for the huge opportunities in the world’s greatest challenges. It’s really an incredible model. All right. Before we get to the final question, I have
one random question for you. Jay Samit: Okay. Tom Bilyeu: Do I understand correctly that
you’re into magic? Jay Samit: Yes. Tom Bilyeu: How’d you get into magic? Why are you into magic? Jay Samit: Everybody has a hobby. At four years old, I saw a magician. I thought it was the most amazing thing I
ever saw, both from the tricks that he did and the power that that person standing on
the stage had over everybody else. It was the first time that I get to see adults
not understand their world. Something as a kid that you’re used to, and
go, “Oh, they can’t figure out what he’s doing.” Turns out as an entrepreneur, it’s probably
the greatest form of training that you can have as a magician. Tom Bilyeu: Really? Jay Samit: It’s because when you go to see
a singer, you want to see them sing their best. When you go to see a dancer, you want to see
them dance their best. When you go to see a magician, you want to
see him fuck up. So it’s the only art form where the audience
is against them. They’re trying to figure it out. If you can overcome that, convincing somebody
to put a song in a burger or sing at 35,000 feet, that’s pretty easy. Magicians were used to win World War II. Magicians were used in the Iraq War. We still call-
Tom Bilyeu: Are there examples? Jay Samit: Oh, yeah. Lots of great stuff. The Nazis wanted to bomb the Suez Canal. Before fancy radar and stuff, you would eyeball
it. They knew where Cairo was, they knew where
it was. So they would go out every night to bomb Cairo,
and they’d wake up the next day, and they have spies in the city, and they go, “You
didn’t bomb Cairo.” They come out the next night. What they did is they mapped out from aerial
where all the lights of Cairo were, go out in the desert, do the same thing, shuts off
all the lights in the city at night, and you bomb the wrong place. Tom Bilyeu: That’s incredible. Jay Samit: Anyway. I’ve talked about it endlessly. Support a magician. It’s a fun hobby. Tom Bilyeu: I’ve actually taken classes at
the Magic Castle and- Jay Samit: Cool. Tom Bilyeu: I’m terrible and definitely am
not a member of Magic Castle, but- Jay Samit: We’ll go over and have fun. Tom Bilyeu: That would be amazing. Because I’m into close-up magic as well, the
first time you pull off a vanish, and you can see like people’s brains melt a little
bit. I remember when I first told people that I
was going to get into it and that I thought it was really powerful from an entrepreneurial
standpoint, people were like, “What are you talking about?” I said, “It’s about understanding psychology. It’s about understanding the way the body
works against you. Illusions, motion tracking. It all comes down to understanding the way
the human mind works.” Jay Samit: It opens you to the possible because
you can’t explain what you just saw, which is what the mindset is to close any deal. There’s something new that you don’t know,
and now let’s solve it together. Tom Bilyeu: All right. Last question. What’s the impact that you want to have on
the world? Jay Samit: I’m focusing, what I hope will
be the last third of my life, in trying to help people be empowered, to build up this
global middle class, to have stable democracies. To me, it all comes from having entrepreneurs
be successful and building an entrepreneurial class. All the innovations that we take for granted
were done by entrepreneurs. All the positive change that we’re experiencing
comes from entrepreneurs. And we’re not making enough of them. We can rattle off top famous athletes or top
famous movie stars, but we’re not celebrating those that took the risks and made our world
better. Really trying work with young people, work
with college kids, working people that hit that midlife “What have I just done? I’ve worked 20 years, and is that all there
is?” That’s what drives me. I’m fortunate to be in a position where I’m
able to focus on that. I appreciate you having me on and sharing
Disrupt You with your audience. It’s now in eight languages. I’m humbled by the response and the daily
e-mails I get from around the world, and that just drives me to work a little bit harder. Tom Bilyeu: If people want to reach out to
you, send you something, follow you, where would they go? Jay Samit: I’m easy to find. Jay Samit, my name, J-A-Y-S-A-M-I-T .com. Jaysamit on Twitter. Facebook, LinkedIn. Reach out to me. I’d love to hear from you. Anything that I can do to help you in your
journey to success. That’s what I’m about. Tom Bilyeu: Jay, thank you so much. I can’t thank you enough for the book, for
everything you’ve done. Jay Samit: You’re too kind. Tom Bilyeu: It’s really, really incredible. Guys, this is somebody I promise you you’re
going to want to dive deep into. Start with his book. It’s certainly the easiest place, but he’s
got a whole universe of interviews, content, everything. And he is going to teach you one of the most
empowering lessons that you will ever learn, which is right before you. Right in front of your very eyes is something
that you’re struggling with every day, and in solving that problem, you can build a business,
you can learn something about yourself, you can generate wealth, you can help other people. It really is incredible. The thing that I found most fascinating about
him is, even if you don’t want to run your own company and you want to work within a
company, and you want to generate change within, this is something that he knows all about. The whole notion of spending other people’s
money, but it comes down to the same problem. Find out what the problem is, find out the
people who share that problem, help solve that problem, and you can get a lot of people
focused and moving on what you’re doing. But you have to own that responsibility. You have to remember that it’s not up to them
to get it, it’s up to you to explain it. My friends, please, I’m begging you. This is one of the most important books I’ve
ever read. If I had read this 10 years ago, it would’ve
accelerated my success. I cannot tell you how much. This is one of those books you will write
and thank this man. You will write me just for mentioning it. I’m telling you it’s that strong. Check it out. It’s called Disrupt You. All right. This is a weekly show. If you haven’t already, but sure to subscribe. Until next time, my friends, be legendary. Take care. Jay, thank you so much for coming on. What a pleasure, man. I’m honored. Hey, everybody. Thanks so much for joining us for another
episode of Impact Theory. If this content is adding value to your life,
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