Tom Bilyeu: Billion Dollar Exit, Embracing Struggle, Mastering Emotions, and Future of AI | S2 Ep. 175

0:05Hey everyone, welcome back to Founder Story. Today we have a very, very special guest. Tom Bill you you are the CEO of Impact 3 and I don't have to give an intro because everyone Tom knows you and I got the privilege to meet you in an elevator at VCon a few years back and I knew at that moment like I got to get you on this show because there's a lot of things that you've been doing and I've been watching over the years on top of the fact that you know the amount of success you've had but I think there's also maybe things that people don't know about you and we're going of dive into all that. But before we do, Tom, what was that spark in your life that made you say, you know, going all the way back, I want to be an entrepreneur?

0:50Honestly, I didn't want to be an entrepreneur and I'm certainly not a born entrepreneur. I wanted to control my destiny as a filmmaker. And I had met these two very successful entrepreneurs and they said, look, you're coming to the world with your hand out. And if you want to control the art, you're going to have to control the resources. So you should get into business and get rich. And boy, does that sound dumb now? But at the time it sounded brilliant. And I was like, yeah, let's do that. I thought it would take 18 months and it took 15 years, but it worked. But that was the spark that got me into business.

1:24The same guys that ended up being my partners in Quest, but originally I started in a security software company. They had hired me just as a copywriter. And so it spent a lot of years there. I thought it was going to happen in software. And then I tried to quit, literally went in and gave back what was about$2 million in equity. And I was like, look, I'm not going to cross the finish line. I don't want anything for this. I just need to go do something that makes me feel alive. I realized finally that you cannot guarantee success, but you can guarantee struggle. And so I was like, I need to struggle.

1:56It's something that I'm going to love that makes me feel alive. And so I was going to move to Greece and because my wife is Greek, was going to move to Greece to some small town and just write screenplays. And they were like, wait, wait, wait, wait, wait. we're not happy either. What would it take for the three of us to keep working together? And the answer to that question over time became Quest. But at the time, like I said, it was about eight years at a software company first. So having then become a unicorn founder and you exit the company, I think a lot of people know that part of your story.

2:29What would you say separates somebody from a person who creates a unicorn company and somebody who does not. Okay. So, uh, that is going to be multifaceted. So let's start with timing. If you want a unicorn company, you are not going to be able to brute force your way into that. You've got to get something very right about what the world wants at that moment that has not been delivered for some reason that you just get the timing perfectly right. So take quest. When we started, we didn't start because we're like, Oh my gosh, this is going to be the fastest growing company in America. Like this is going to be crazy.

3:05We said, um, you know, I'd gone in and quit. My partners were also unhappy. The thing that the three of us happened to share an interest in was health and nutrition. It was something that I could show up every day and fight for my family and have passion and a reason to be there. Uh, and I wasn't thinking, Oh, like I know I'm going to leverage my storytelling and I'm going to blow this brand up. It was okay. Wait a second. There's this thing coming that we now call social media, but at the time. I just thought it was going to allow me to build a thousand true fans. So I was like, finally, I can stop being a slick marketer.

3:39And because I so relate to the worry, the world in terms of story, I'm going to bring into a protein bar company, which is the weirdest thing ever, a studio to start making our own like commercials and stuff. That was really how I thought about it in the beginning was we were just going to tell our own story. We thought we had a really unique story. I have this impulse to tell it in a new way. I could see that this thing was going to become something, but it spoke to me. And so on top of that, we wanted to end metabolic disease. So when confronted with the fact that the bar we wanted to make, quote unquote, couldn't be made, we realized, well, we either don't launch this company or we figure out why everybody thinks this can't be made and find a solution for it.

4:19And then right as we're doing that for our own private reasons, the world woke up to the fact that sugar was a problem and social media, exploded. So we were the first ones, I mean, not like the first, first, but we were one of the first people with a brand to start making our own content, telling a story, really understanding what now we would refer to as community building, but we were just doing it all out of a totally different impulse. So we got the timing, right? I happened to be a storyteller. So I understood all of the content creation and all of that and match it with, we made a product that was a real zero to one moment.

4:56It tasted like it had sugar in it, but didn't because we solved the manufacturing challenge that made that possible. And so you just put all that together with the world waking up suddenly to sugar being the problem. And now influencers on Instagram showing their six pack abs and people ask, oh my gosh, what do you eat? And they were all like quest. And it was just this perfect confluence of events. So unicorns, they get, there is an element of timing that I'm very sad to report is very real. Then on top of that, we had spent, I mean, they had spent way more time than me building their chops as an entrepreneur.

5:28And then I had already spent almost a decade building my chops as an entrepreneur. So now all of a sudden you have very business savvy people that they get the timing right on something that really matters to them at a personal level. And you get the explosion that we had. So being savvy of business, like literally, how do you run a P &L? How do you manage cashflow? How do you hire well? How do you structure a business? Like these are all things that are teachable. And this is one thing that that's really bothering me about the way that people look at people that sell courses. So I sell courses, right?

6:01Just a big black mark on my reputation. The way that people look at this is so crazy, but here's the reality. Business works in a knowable way, but most people don't know it. So at some point, somebody has to teach it. Now, admittedly, I don't teach how to get rich. I teach how to run a business. Now, if you get the timing wrong, if you have the wrong product, you're not going to go anywhere. But knowing how to be business savvy is a very learnable, teachable skill. And if people can wrap their head around it, that this isn't about drop shipping, it's not about the latest thing in marketing, that entrepreneurship is about understanding how to solve novel problems well.

6:37And you solve those novel problems by thinking from first principles, but you also just have to have enough experience or thank God for AI access to something that can answer all of your questions about, okay, well, I need to formulate this deal. What are the 10 best ways to formulate this deal? ChatGPT is going to give that to you right away. It's absolutely incredible. It is a miracle. But you have to build that knowledge set of how to think through those problems. And a novel problem isn't a problem you've never seen before. It's a problem no one has ever seen before. But if you can teach yourself first principles, it really is possible.

7:13And so, man, don't let anybody tell you that you have to be born an entrepreneur. You do not. But being a good person, wanting to help the world, that is not the same as being business savvy. So if people can click over into that reality of this is a knowable, learnable skill, but it is a skill and it must be mastered, then they've got a shot. What an amazing story. And I really like the perfect storm concept of so many things had to have been going right, people in the right places. How do you see AI being able to or enabling people to solve more problems because it can tell them maybe how to or even the problem to solve?

7:55So when you look at business and business success, do you think AI is going to enable a lot of people to be more successful? Or could it even maybe get in the way? Maybe it tells you too many things and then people are going in different directions. Think of its current form. It will change over time, presumably. But think of its current form as the most sophisticated calculator or all of the mathematics that Excel can help you run. So everybody has access to it, but it doesn't mean that there aren't people that understand mathematics to a degree that they know how to leverage the tool to far more sophisticated outcomes.

8:29So AI is not going to make more people successful. What it is going to do, though, is to empower more people to run their own companies. That's going to be one of the great changes in society over the next 10 years is I think you're going to see the disaggregation of capital, which I don't know is a good thing, but it is going to happen. You're going to see a disaggregation of capital. You're going to see a ton of solopreneurs that are building companies that are really doing revenue. Call it, you know, your five to$25 million companies, right? Relatively small in the grand scheme of things, but you can have a whole bunch of people that are doing that all the way down to a gaggle of people that are making their 75, 90K a year, but they're doing it running their own company.

9:13And that I think AI will facilitate massively, especially as agentic AI comes online and people are able to actually get the AI to go do things. I think that's going to be a real shift, but everybody has access to it. This is going to be something there won't be these huge modes where only a very small number of people have access to it. We just saw with the release of DeepSeek how quickly they were able to chip away at the leadership of OpenAI. and even OpenAI was already cheap compared to what you get. I mean, it's absolutely insane. So you'll see that, but ultimately it's going to come down to, well, now that everybody has access to this calculator, who understands how to allocate capital better?

9:54So not just balancing your budget, but actually allocating the capital in the wisest way possible. So knowing what questions to ask ChatGPT, when it gives you multiple pieces of advice, which advice do you take? How do you know when to go? Nah, that's conventional wisdom. That actually doesn't make sense. In this scenario, we've got to do something different. Those will be all the differentiators. You made a video this year. I really enjoyed your video about 2025. And you said something in there about embrace the suffering and controlling your emotions. I personally have struggled with this when it comes to entrepreneurship.

10:26I feel like it's a roller coaster, as you know. You have a great day, and the next day, everything is toppling. And your whole world is crashing and coming down. and you feel like your business might go out. You might lose your business in 24 hours. It's insane. And then the next day, everything is back and you're running 100%. How do you handle those moments? One, I don't value myself for success. I value myself for the sincere pursuit of something that I care deeply about. And obviously, when I say sincere pursuit, I mean, I really am trying to win. But I accept that I'm not going to be able to control that, that it just may not happen.

11:06And my life cannot be predicated on whether I win or lose. So that's number one. So if it all catastrophically crashes down, it is what it is. Also, I think it is very important to understand that your emotions are not always to your benefit. They help you make a decision. Emotions are critical. You're never gonna be able to get rid of them, nor would you want to. But you need to be very distrusting. So when I feel anger, fear, anxiety, whatever, I don't go, oh, this is justified. I go, huh, I'm feeling an emotion. Why am I feeling that emotion? Will enacting that emotion lead me towards my goal or not?

11:44And if it won't lead me towards my goal, then I'm gonna do everything I can to get out of the grips of that emotion. If I have to stop and meditate, then I will do it. But you have got to have a very distrustful eye to the things that you feel. and all too often I see people fail in business, fail in life because they are convinced because they feel something that they should act in accordance with that feeling. And I just fundamentally reject that. But even people close to me, man, I'm saying people that watch me, they see how I move. They see the level of success I've been able to achieve all the while telling them, this is because I don't trust my emotions and I am constantly looking for evidence of efficacy that this thing actually works.

12:24they still need to have their emotions validated. That is an impulse that is, it's just insane. It's insane because things should be judged based on I have a goal. I know where I'm trying to get to. Will doing this thing lead me to my goal or not? If yes, do it. If no, don't. So yeah, I don't, I can articulate the reasons why people need to have their emotions validated, but I can't internalize it. It is nonsensical to me. I like that. Don't trust your emotions. Sometimes I need to not trust my emotions. Luckily, my wife is there to tell me because she's a way better entrepreneur, I think, than I am.

13:05I know you have been working with your wife and I always enjoy watching her videos, your videos, and talking about the experiences and the fact that you both are just so vulnerable. It's an inspiration. I'm coming out of the book soon and I'm very scared because of the things I'm saying in that book, I've never said publicly, but you two are so vulnerable and you talk about everything and it's really inspired me. So what's been the most rewarding part of working with your wife? That's very easy. So we share a life. The whole thing, when we got married, I said to her, look, the experiment we are about to run is what does a life look like when you just completely take divorce off the table?

13:50You know, like we are going to share this life. Now, of course, course, if there was abuse or whatever, like we would eject instantly. But assuming that that's not the case, that every time you encounter a problem, you're going to find a solution. And so for years, I was running companies and she was a stay at home wife. And that was when we were really getting pulled in different directions. I was so stressed that I would come home and say, do not ask me about my day. I don't want to talk about it. And so she felt totally isolated from a huge part of my life, especially given how much I work.

14:23And so starting at Quest, we decided we were going to build together. And I mean, it's just been incredible. Like you're, you're, you're actually sharing a life, not in theory, but in practice. And so getting to build something together and seeing each of us shine and grow has been truly incredible. So there's a lot hiding in the phrase, share a life, uh, the ups and the downs, the being there for each other, when things go wrong for getting to celebrate the same things. And so like when quest sold and we were suddenly wealthy, that was like a thing we did together. And so not only is it like, Oh my God, like we actually pulled this off.

14:59It's, we did this together, all the hardship, all the late nights. One of my favorite, uh, like clips that I have of my wife is, uh, we were in the facility by ourselves. It was really cold and it was like a Sunday on a really special weekend. She thinks it was Easter. I think it was Thanksgiving, but anyway, somewhere a period where it was cold and special. And, uh, she was just like, not, not having a great time. And she's like, here we are like, yay. Uh, and so you have all those ups and downs, but when it pays off and even if it only pays off and like, wow, we really did that together. Like we spent that time, we learned those lessons.

15:41We got punched in the face. We got back up. We earned our own respect. It's a big deal. And when it pays off, of course, it's extraordinarily joyful. But all of the ups and downs are ups and downs together. Well, I guess when my wife and I were getting married, part of her vows was she's not going to get married again. So I guess I always hold that to her. I'm like, look, when things happen, I'm like, you told me you weren't going to get married again. So I mean, you're kind of stuck with me. But I do like that when divorce is off the table. What are the things that you can do. So thank you for sharing that.

16:12How do you look at longevity? Obviously, you've had incredible life success. It's amazing the things that you both have had. You get to do together. Your day to day looks incredible. How are you looking at longevity when when there's all these things on TV about how much money people are willing to spend to live to 200 to 50? Who knows how long we'll be able to live in the future. But how does that look to you? Yeah, So I'm obsessed with longevity. I would give every dollar that I've ever made to extend my life meaningfully, for sure. Like, that's not even a question. The money serves no purpose if you are dead.

16:52So that one's pretty easy for me. I don't understand people that think, yeah, this is only interesting to me because I know that I die at some point. It changes how I feel about my life, knowing that as of right now, I'm on a collision course with death for sure, but it doesn't make it better. So I don't share that frame of reference. So yeah, I want to live forever every day that I've ever had, even the absolutely miserable ones I've always wanted the next day to come. So that is my default stance on life. May it go on forever. If there was a cataclysm and I was the only person that survived, as long as I could take my own life, I would still want to be the person that survived just to like see the pure fascination of it all.

17:37So yeah, I don't, I cannot relate to people that are like, oh man, if half the world dies, I hope that I'm in the half that dies because I don't want to deal with the loss. It does not compute for me. I like that. I don't know if I'd want to be the last person. Maybe like the last two or three. I don't know if there's a wants to be the last person, but if there is going to be a last person, I hope it's me. How about that? I like that. But is there anything else that you're thinking like, OK, I want to accomplish this? Yes, of course. So I'm trying to build the next Disney. Now, what does that translate to in the real world?

18:15Because that actually sounds so outdated now when I think about where the world really is. But as a child of the 80s, you will forgive me that that's my reference point. But I want to build Ready Player One, the game. So if you've read the book, it is a world that envisions a simulation that is so compelling that people spend inordinate amounts of their free time inside of that virtual world. I expect that to be a very controversial thing, but that is the most thrilling thing for me. It is mathematically almost certain that we are in a simulation right now. And given that, I want to see how amazing of a simulation that I can create here.

19:01This year, it's not going to be anything like actually real. But game development storytelling is still my deepest passion, for sure. Can you dive into the university and all of what you're building now when it comes to teaching people entrepreneurship or how to be better at business? Yeah, of course. So it's something called Impact Theory University. And it was me saying, okay, I am not a born entrepreneur. So I had to learn this through the school of hard knocks. I've got the credibility of having built multiple companies. I built three multimillion dollar companies, including$1 billion exit.

19:38So I'm like, this stuff is repeatable. It's teachable. And I want to make Harvard Business School irrelevant. So we launched it with the desire to, one, just help people orient their mindsets. So we do also mindset stuff. But to me, mindset needs to be applied to something. For me, that something is business. That's how I impact the world. So business class is both for people doing what we call going from zero to founder. So you know nothing about business. You have to orient yourself. How do I pick the business that I'm going to start? How do I begin to grow it? And then we also work with people that have an established business, some of them doing hundreds of millions of dollars in revenue, and we help them scale.

20:19So that is one of the great joys of my life. So there are three things that we do. We've got the content, which is what most people know me for, the YouTube channel. Then we've got the education, Impact Theory University. And then we've got the entertainment, which is on the gaming side. And so, yeah, getting a chance to not only be a day-to-day operator, but also be talking to people about what I'm learning and watching them deploy that in their own businesses has been exceedingly gratifying. So my final question for you, and I always enjoy getting to talk to somebody else who also get to have incredible conversations with other people.

20:55Is there somebody out there who you're like, okay, I've never interviewed this person or had this person on our show. I really, really want to. For sure. So because I'm so obsessed with AI, I would love to get all the major players in AI. Sam Altman certainly being at the top of the list. Eliezer Yudkowsky, I really would love to sit down with him. There's a lot of major players in that arena that I would really love to sit down. Elon Musk, that would be incredible, especially now. Boy, oh boy, is he a controversial figure. but I am just absolutely gobsmacked at what he's been able to accomplish.

21:32It is like he has six months for every day that I have. It's insane. I don't know how to make sense of it. It's really, really incredible. And you can look at that and be angry or you can look at that and be inspired. And I am incredibly inspired. Okay, I lied. One final, final question. I know we're almost out of time. Is there something that scares you about AI or something you're concerned about for the future when it comes to AI? Very much so. If people aren't an equal mixture of terrified and excited, then I don't think they're looking at it right. It is entirely possible that intelligence has an innate drive to express its own will.

22:14That may be innate to intelligence. if that is innate to intelligence we are in trouble because we will create something that is far smarter than us and just as we have no ill will to the things that are not as smart as us uh but we intentionally or unintentionally corral them into their own little space and we move on and do our thing and um using elon's quote that if we're building a highway and there's an anthill in the way it's like no hard feelings but we're gonna destroy the anthill to put the highway so i have no doubt that a sufficiently intelligent being that has its own agenda and cares deeply about its agenda and we could potentially get in the way of that agenda will just...

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24:22But it's also possible that that's not a function of intelligence and that intelligence may simply be the ability to process raw data faster than the next person to find more novel connections that other people are overlooking and that the amount of data that it can process becomes just unbelievable. So if all of that's true and there are algorithms that create deep efficiencies, now all of a sudden you can map things as complex as the human body, for instance, and say, oh, this is exactly what This person needs to eat, do in this exact sequence, in this exact time to live forever. Or here's how you harvest cells from your body and turn them into organs so you never go into organ failure.

25:05Or here's how you upload your consciousness into a computer and live forever. Whatever. All of those things, including driving the cost of energy to effectively zero, are possible with AI. So it is entirely possible that on the other side of a probably pretty bumpy transition period, which I'm not delusional about that, is a world of abundance. And I think that that is probably more likely, like admittedly, I'm thinking like a sci-fi writer. I'm not gonna be able to give you a deep argument on AI alignment. We'll let the AI philosophers debate that out. But I don't have any reason yet to believe that a fundamental nature, that the fundamental nature of intelligence is will.