When to Quit with Steven Bartlett (Part 2)

0:05What is the difference between real ambition and fake ambition? This is one of the things that Stephen Bartlett and I talked about in this part two of our conversation. He's remarkable. He started building businesses at the age of 18 and at only the age of 30 has gone on to become one of the leading voices for entrepreneurs in the world. We talked about all sorts of things, including knowing when to quit and when to persevere. I hope you enjoy. This is a bit of optimism.

0:40The best companies in the world, the best leaders in the world, it's not that they just have high standards, which they do, but they make it abundantly clear the culture that you're walking into. I've also ran the test. So like I've got multiple companies that I have this bird's eye view on and I see the companies that have high dissatisfaction that I'm an investor in. Yeah. I'm on the board and I see the, it tends to be the case when there's lack of clarity regardless. Yeah. Either way, if it's remote working or if it's in the office five days a week, the biggest disease is lack of clarity. And then people can choose.

1:14And the worst company cultures in companies that I invest in are the ones where they have weak leadership in terms of giving clarity and setting expectations, regardless of what the expectations are or regardless of what the working dynamics are. And so with my thing in my companies, if I'm the CEO, if I'm driving the company, you're going to know. You're going to know exactly what's expected of you. You're going to know exactly what our cultural values are. And I'm going to defend it like no one has ever defended it that you've ever seen. And if you speak to people that work for me, like the CEO of one of my companies called Flightstory, he will recite moments where I acted totally against the company's short-term objectives in a way he could not understand to defend our values and our culture of kindness.

1:51Even though we needed this person and we're going to lose a client if we let this person go, me finding out that they did something to a junior member of the team, they spoke to them in such a way which I think is unacceptable, I remove them which means we lose the client fine and I remember the conversation that day with Oliver saying I'd rather not have a company with my name attached to it than allow that behavior to exist anywhere on any of these walls it's a violation and if we allow that violation it's like a frog in a frying pan it will slowly creep on you it's like a disease so this is why I said earlier on I'm obsessed with culture because for me I'm clear and it's unnegotiable and we do the best work of our lives we do great great stuff we really do we outfail all of our competition which is really the key to becoming successful, I think, especially in a world that's changing at lightning pace and is only increasing in pace of change.

2:35What does that mean? Like, you know, so if you remember reading about, I think it's Ray Kurzweil, he's the eminent futurist in the world. And he says, if you're 10 years old now, you'll experience a year's change in 11 days by the age of 60. Ray Kurzweil says that we'll experience 20 ,000 years of change in the 21st century, which is 100 times more than the rate of change in the previous century. We're going into a world that's changing faster than ever, where books and typical sources of information aren't going to give you the answers. So how do you find the answers to key questions in podcasting, marketing, business, sales, processes, when the world is changing so quickly?

3:10Well, you have to be failing faster than your competition. And that's a philosophical thing. It's a behavior thing. It's a culture thing. How do I get my team to outfail the competition? If we do, then we're going to arrive at the right answer continually faster than everybody else. Because podcasting is a good example. I can show you on my phone now, the diary of a CEO translated into every language in the world. A two-way conversation. So you're speaking in Simon Sinek's tone, but in Italian. I can show you that on my phone right now because we've done it. I can show you the tool we've built to A-B test 40 thumbnails at the same time before the episode comes out.

3:42And then when it comes out, it tests eight every hour. I just appointed this week a head of experimentation. And I know that these, and it goes back to my obsession with these 1 % games. I know we're going to fail our way faster to the right answers across the businesses that I run. And that's why I'm sure we'll be number one, because our rate of failure is significantly faster than every other team because of culture, dynamics, a lack of bureaucracy, empowerment, smaller teams, incentivizing the experiment, not the outcome of the experiment, conducting type two decisions faster than everybody else, decisions that are reversible, realizing that time is in fact usually the biggest cost in decision making, not the outcome.

4:18that's the way we operate and it's always worked for us and it's i feel like in that regard i have like a uh i feel like i have a secret to business which is most people are you know that they're messing around and trying to make big steps forward my obsessive belief is that it's the tiniest small steps forward that are discovered through failure and higher rates of experimentation and make all the difference and it's little because little failures are not a big deal I think people are so afraid of failure but the problem is they're thinking they're thinking of large steps small big decisions small quick things small quick things constant constant improvement I spent 10 years working in marketing so I would sit in these boardrooms with CEOs and there was this father and son they run two different brands and under the same company I'm going to call it dad's brand son's brand now when I took an idea if I you know there was this one moment where I figured out a loophole in Instagram where we could grow a following cheaper than anybody's ever grown it before.

5:11And I took it to the dad and the son. The dad, I present the idea to him. He's arguing about the cost. He's da-da-da-da-da. He wants evidence. Nine months of him deliberating whether to proceed with the idea. I take the idea to the son. The son would always say, Jenny, go and get Nicky and the entire team. Call them into the room and say, Steve, repeat what you just said to me. And I'd repeat the idea. And he'd say, we're going to do it now. No contracts, no worry about the money, how much we're going to get paid. He says, we're going to do it now. We'd conduct the experiment, and in that particular case, it gave them 13 million Instagram followers.

5:41Now, why do I say this story? This is not a one-off. This happened for five years with me working with the dad and the son. Two billion dollar companies. The conclusion of the story is the son's business overtakes the dad's business and is now the biggest business in the space. The moral of the story is the son intuitively knew that the cost wasn't the 20K. The cost was time wasted, procrastination, and the missed opportunity. He also knew that in the grand scheme of things, that really what mattered more was getting on to the next experiment. And Amazon are the prime example of this, the Fire Phone, the this.

6:13They have a graveyard of failed experiments, but then they have AWS. It's one in 20, and you don't know when it's coming, like a slot machine. So it's really getting through 20. The son knew we needed to get on to the next experiment. If that experiment had failed, the next day we're on to the next experiment. So he's going to conduct 20 experiments in the nine months that the dad is deliberating one experiment. It was the rate of experimentation. And I just watched him wipe the floor with his father. And people that know me will know who I'm talking about. Wipe the floor with his father because of speed of experimentation.

6:43So I think about that a lot now. Get all of the things out of your way that are slowing your rate of experimentation and measure it. The Kaizen philosophy, which I write about at great length in my book, is a prime example of this. It shows it's all about empowering the people at all levels. And innovation isn't the job of the C-suite. empower the people on the production line, incentivize them and measure the amount of experiments they're conducting. And then in the case of Toyota, who are still leading the world in auto production, you'll get 100 ,000 times more ideas from all levels of your company than your Western counterparts, which will drive efficiencies, drive profits up, drive costs down, reduce the amount of absenteeism, defects in the cars and everything else.

7:21And with the Kaizen philosophy in particular, which is this idea that everybody at all levels in the organization is responsible for innovation and it's a flatter organization where you just have three levels where you have like management team leader and then leader they've proven because they've taken over other companies like gm back in 1970 they took over gm installed their culture and a factory in america that had 12 defects per vehicle had 20 absenteeism rates had a backlog of 5 000 grievances from their employees became GM's best production facility in the world with the same workforce, with the same people.

7:59They put in a firing freeze and it was just culture. They went from being the worst GM plant in the world to being the best GM plant in the world with a change of culture, which was centered on empowerment, removing levels of bureaucracy, giving people the knowledge that they needed and listening to people as well. Here's what I've learned sitting with you. And I find this last bit absolutely magical. Everything about you is a work in progress. And what I mean by that is, is you apply the same philosophies to yourself as you do to your businesses, which is constant improvement, constant improvement, constant self-evaluation, constantly looking for something new.

8:32The reason being is when it works, you know, those little glimmers, because they're glimmers, those little glimmers feel like when you're in the backyard, in the garden, with your brothers, with the sun shining, and it's just effortless. And the family is functional and the constant improvement, the constant working on it is for these glimmers of magic. The motivation is the sun on your back with your friends. And you've spoken about this, which is the way you describe that experience in the garden with your family is the same way you described when I asked you to give me a business example that if every day was like this, you'd be the happiest person alive of every project.

9:12And you described Diary of a CEO. And it sounded very much the way you described, except your brothers were replaced by your team and the sunshine was replaced by that you're making an impact. Even though everybody's working really hard and even though you're running around and everybody's sweating, there's this joy and effortlessness that comes from it. And at the end of the day, it's about family, right? It's about creating that sense of family and people who share in the joy. And this is what I find absolutely magical about you, which is you're very unselfish about your success. You want to bring as many people.

9:49You want to bring the team with you. The diversity is a great example where at the end of last year, we show everyone the bank account in the team. So everyone gets to see how the money's being spent. And then at the end of the year, we take last year, I think it was 20 % of what's in the bank account and give it to the team. it's a new way to build a company but again it goes back to this thing of trying to go for 10 years where there's people in the team whose size of bonus at christmas was the same size as their salary and they're 21 handing over that check in my house where we all met every single member of the team including sophie here who got enough to pay off her mortgage at christmas she said um was the best day of my career you know it was genuinely the best day of my career being able to do that build a company where there's not like these other shareholders and being able to pay off Sophie's mortgage with a Christmas gift that she wasn't expecting.

10:32That's, you know, that's the sunshine. That's the sunshine. Yeah. That is, it is, we do run like a family. I mean, like it's the pursuit of sunshine. Yeah. Yeah. I still think I'm trying to figure out what I do. The pursuit of sunshine is a nice way to sum it up. And I think about it a lot. I just think more broadly about humans. Why we struggle? Like why we, why we need to climb and why we need to achieve. Human beings are dopamine driven animals, right? For good reason. Find food, find shelter, find protection. Here I found some food, got it, dopamine, do it again, do it again. But that's only one half of how human beings work.

11:05The problem is that it's a very tangible thing. Dopamine is produced by tangible outcome. A metric that I can count, food that I can eat, my keys that I lost now that I've now found, like here they are, that's dopamine. I hit three sevens on the slot machine. You have to be able to see it. And we're very, very tangibly driven animals. is a very powerful motivator, but it doesn't produce feelings of joy, safety, love, which are the other flip side. And that's all of that slow building chemical stuff of serotonin and oxytocin. The hard work of being human is maintaining the balance. I think this is so funny as because we're animals, like all animals in mother nature, cats don't have to work very hard at being cats.

11:46They just, they're cats, but humans have to work really hard at being good at being human. and we can screw it up so badly. And remember, we're very old machines. We're a very legacy machine, tens of thousands of years old, operating in a world that our bodies and our systems were not designed for. Perhaps 50 ,000 years ago, we didn't have to think about how to be a good human being. It probably was organized to work. But in this modern day and age, we have to because there's so many things that will break the machine. Think about it. In the West, because there's so much abundance. Just go to the supermarket.

12:20We actually have to think about nutrition. We have to think about what we should eat and how we should eat. 50 ,000 years ago, that never happened. Whatever you found, and by the way, it was fine. It's because everything around us has hijacked and broken the human being. But I just get a kick out of the fact that it's so hard to be a good human. This idea of constant improvement for you is very, very balanced on working very, very hard to be a good human being, be kind to those around you, bring those around you on the journey with you. The sunshine is paying off the mortgage. I just love that you do it.

12:55I think a lot of people talk about it. And we live in a world where the hard-nosed business people scoff at the people who talk about kindness and generosity as business philosophies. And then you have the other side of the sort of like the universe will provide that scuff at people who are driven by metrics? And the answer is, you're both right and you're both wrong. It's both. It's both. Where so many CEOs look like Jack Welch today, which I think is abhorrent. I'm bullish that in 10 or 20 years that the majority of CEOs will look and act like you. When we talk about mental fitness, I think the antidote isn't yoga.

13:36It's working for people, with people who care about you and want to see you succeed and succeed together. The business is the modern tribe. Yeah, it's exactly that. And the tribal leaders have a responsibility to make sure that the tribe survives bad weather, drought, an attack from another tribe, an attack from another wild animal. And it is very tribal. I don't think somebody older than you would have figured this out. And I hope that you inspire people who are younger than you on how to do this right. I want everybody to read all your books. I want everybody to listen to your podcast. You know, when I think about the diary of a CEO, it's not the CEO part that matters.

14:17It's the diary part that matters. It's the self-reflection. It's the recording. It's the gratitude. That's exactly why I chose the name, which is you don't often get to see into the diary of a CEO. They tend to keep it private. So it almost felt like a bit of a juxtaposition, something so secretive and elusive and somewhat guarded. And then the diary, which is vulnerable and open and the antithesis of that. That's really what I'm trying to do is trying to get people to open their diary and to share the wisdom, the honesty and the vulnerability that exists within it. So you're good at getting other people to open up their diaries and you do it by demonstrating your willingness to open up yours.

14:54That is true. Just as you said, you'll stay up till one o 'clock in the morning with your team and not ask them to do anything that you wouldn't do. You're not asking anybody else to open up and answer questions that you wouldn't answer. They wouldn't. When we first met, if you got the impression that I was like threatening or like I was unwilling to be equally open with you, I don't think we would have had the conversations that we had. When I say focus, consistency, and showing up every day and trying to find a 1 % gain, this is why. And this is also why we're not going to launch the podcast network, which we spent 12 months and I extended an office to one of the biggest CEOs in the media world.

15:29and I sat down with my team and I said to them, and I talk about this idea of this pre-mortem analysis. I said to my team the day before I was going to sign off this job offer for this guy to quit his job at this big company and come and join us to launch a big global podcasting network with all the skills and knowledge we have. I said, why will this fail? Question I haven't asked a lot in my career. And there was this pause amongst my team. And then minutes later, boom, reason one, reason two, reason three, focus. if we have talent or celebrities what if they leave um we'll lose sight we don't have enough resources to run multiple podcasts we'll lose sight all of these reasons came out i made the decision after 12 months of work and spending hundreds of thousands of pounds to not pursue it and to go back to focus and you know i think this is something that people don't understand which is the momentum of a decision like just because we spent time and energy doesn't mean we should do it there's a lot of leaders who are plagued by this which is we have to do it why do we have to do it because look how much time and money we've invested there's a psychological bias which I write about, where they tested, they basically got a group of people.

16:30It's Elliot Aronson, the psychologist, the American psychologist, one of my favorite. They got a group of people and they put them into a very boring book club. Very, very boring. Everyone in there was purposefully, intentionally dull. And then they asked them how good the book club was. And they all gave a score. So these people that were put into there. Then they got another group of people and they made them go through a rigorous testing process and surveys to get into the book club the people that had done the rigorous testing and surveys and applications to get into the book club even though it was dull and boring reported that the book club was amazing and was much better than the people that hadn't fought to get in there and it speaks to this kind of like sunk cost idea that leaders have where just because we've worked hard on something they trick them themselves into believing that it is good and then it must be good that's it's a psychological bias and that's what we had done we'd spent a year working on something so no one had stopped to pause and ask ourselves why this is a really bad idea.

17:23We invested so much, too much. A friend of mine, he invited me to sit in on his company, All Hands, which he does, I think like twice a year. And they just have this rigorous process where they go through everything. And it was amazing because I just sat back and there's something that they do that I absolutely love, which is when they invest in a company, they do an internal analysis, which is what are the three reasons we shouldn't invest? Yeah. Right. But he does it on his own company too. He asks his own team, what are the three reasons someone shouldn't invest in us? And it doesn't matter what's on the list.

17:57What matters is when they do it again next time, if the same things are still on the list. I think it's important to say why this is so important because what it does is it, for me, is it changes my perspective. It takes me away from the painting. Sometimes you're too close to the painting that you can't see the picture. It takes me away from the painting and puts me in another perspective where I can look at myself. Just that simple question. And immediately when you said that, I did that with my company, Flight Story, my marketing business. I thought, what's the reason why someone shouldn't invest in it?

18:23And the answer came to mind. There's always going to be reasons why people shouldn't invest in you. The problem is if one of them continues to be on the list, that means you haven't addressed it. Because what it does is it reveals the things that need to be fixed or addressed. So address them. And I know we've done this analysis on ourselves. And the frustration is we had one thing that kept showing up on the list each time we did. And we're like, okay, we have a serious problem here, but this thing is always on the list. So that's our focus is to address that thing. But I love that test. I love that test, which is the three reasons not to do something.

18:53Because I don't think we do that. I think we talk about all the upside. And you and I have talked about this before, which is the cost of things. And we don't mean money, which is everything in the world comes at a cost. There's a cost for the money you make. There's a cost for your relationships. And it's not for us to weigh whether the cost is worth it. Like if somebody thinks it's worth being driven by the size of your yacht and the size of your plane and the size of your house and the number of Lamborghinis you have front. And if the cost is, I am lonely. I have no relationships. All of my friendships are deal friendships.

19:22They're all transactional friendships. If that cost is worth it, then have at it. Like who am I to tell you the life that you should or shouldn't live? But don't wake up one morning and be surprised that you're lonely and have no friends. You knew that going in and you decided that was worth it. Now, if you want to make a change, fine, then be open about it. I thought it was worth it. I realized I was wrong. It wasn't worth it. And so I'm a great believer in evaluating the cost of things all the time and asking myself, was the cost worth it? You've made sacrifices in your life for the life you lead.

19:54I've made sacrifices in my life for the life that I lead and the way I choose to build my movement and spread my message. And if you ask me, was the cost worth it? And it came at great personal cost of personal life and social life, you know, relationships. And the answer is yes. Yes, it was worth it because the thing that I care about, I was willing to pay that. And other people weren't willing to pay that. Again, it's not judgmental. It is all subjective to each individual. And they're North Star. And it's a North Star. But you have to be open and honest with yourself about what is the cost of this decision that I'm making.

20:24I also, one of my favorite decision-making criteria, before I make a decision, and this is stupid little stuff even sometimes, you know, interpersonal stuff sometimes, not just big business decisions. Sometimes it's mundane little stuff. I'll always ask myself, what good will come of this decision? And if no good comes of this decision, then why are you making this decision? and sometimes people who say like well what good will come of this decision it's the principle and they need to know the principle no no but what good will come of this decision like sometimes the best decision to make is nothing it's the decision of indecision but i want to make sure that good comes from my decisions giving somebody feedback sometimes i want to give people feedback because i really genuinely care about them and i want them to grow i'll give you a real life example early early in my career and i was just starting with start with why there was no book no ted talk nobody knew anything about me or any my work anything like that i was giving a presentation to a big conference of entrepreneurs business people thousand people or something it was a big deal for me i was it's very exciting i got done giving the start with why speech and the very first comment guy raises his hand and he says have you ever led a billion dollar company i said no he said have you ever led a significant size team i said no he goes well i think you're naive i think that nothing that you've talked about today is based in reality and i don't think your work is realistic in the real world and i said so don't do it next question please right and the point is like what good will come of me defending my ideas and preaching to him he's not open to an alternative way of thinking and i'm cool with that my job is not to fight with you and be the entertainment for the room for the day right they're like no good no good will come from me picking this fight you know taking the bait goes back to what i said at the start about the quitting framework yeah which is at some point you go the rewards on offer here are not worth.

22:26But I think quitting is an underappreciated topic. I think that like, you must never quit. You have to have grit. I'm like, that's really bad advice. But at the same time, quitting easily is also bad advice. And so the question, and I grapple with the same thing as you, is like, well, when do you quit and when do you not quit? I literally wrote a framework for this to help me understand in hindsight why I quit sometimes and why I don't. And this kind of goes how I said, where are you thinking about quitting? There's a flow chart where on the left-hand side, you're thinking about quitting because it's hard.

22:56Okay, so is the hardship worth the effort? And these are all broad subjective things, but you have to separate something being hard from something, in my words, from sucking. Sucking is like that misery. It's that like kind of the toxic miserableness that I experienced in my companies or that people experience at work or they experience in a relationship. Hardship is the physical hardship. It's not, you know what I mean? And that's the distinction that I'm trying to make. I have an example that I think might make tangible what you're trying to say, which is Leaders Eat Last was the most difficult thing I've ever written, the most difficult thing I've ever done.

23:31Writing that book was excruciating and impossible. And the reason was it was like a Pandora's box. Every single chapter could have been a book unto itself. Start With Why was something like 68 ,000 words, something like that. When I sat down to write Leaders Eat Last, I wrote 150 ,000 words and I thought I was just getting started. Like it just was never ending. and I couldn't organize the information. And I couldn't understand when I got started, like why had none of the social scientists that I was interviewing, how come none of them has ever taken the biology of human decision-making, oxytocin and serotonin?

24:04How come none of them have ever taken these chemicals and overlaid them to corporate culture and written about it? It's because it was absolutely impossible to organize. And I couldn't figure it out. and the stress was extraordinary. I lost two relationships writing that book because I was not in my best mind. It was awful. And so at some point I quit and I realized it beat me. It won. I can't do it. And I remember I went for a walk. I was living in New York City. It was about eight o 'clock, nine o 'clock at night. And I went for a walk and I was walking to plan my exit. I went to plan the checklist of quitting.

24:41So I would have to call the publisher and say, I can't do it, which is technically a breach of contract, which means I'd have to give my advance back. Okay. That's going to suck, but okay. I'd have to tell all the people who supported me and were friends that I can't do it and I'd be humiliated, but I'll get over it and so will they. I'd have to tell the people who were big fans of my first book, that second book that I told you is coming, it's not coming. They'll be disappointed. I'll be humiliated. They'll get over it. I'll get over it. Literally going through the emotional and practical checklist of quitting.

25:10And for some reason, I don't know why, I called a friend of mine who at the time was in the Air Force Special Forces. I called him up and I don't even think I said hello when he picked up the phone. He was active duty at the time. And I said, what do you do when you can't complete the mission? And as is his nature, he started telling me a story. He said, he used to be a helicopter pilot. He said they were assigned to go on this mission in Afghanistan. And all the intelligence said that it was a suicide mission. And not a suicide mission like kill Hitler and you're all going to die. It was like, you're all going to die and the mission will fail.