Robert Herjavec on The Truth About Success, Shark Tank, & Entrepreneurship

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0:59This is the Ed Myland Show. Welcome back to the show, everybody. It's odd to introduce this person because all of you know who he is, but since some of you are listening on audio and can't see him. You're too nice. Oh, it's just a fact. I think of a serial entrepreneur. I think of somebody who, I'm going to tell you what I see in you from a distance, having we just met. I like the fact that you treat people so kindly when you give real feedback. I think you're like the kind shark. the one with real wisdom and poise there's like an elegance about the way that you communicate and by the way that's why he's such a great speaker on stage so if you've seen him on shark tank you've seen him there he's a tremendous stage speaker best-selling author serial entrepreneur but overall he is somebody that i've admired from a distance for a very long time and i want to have a different type of conversation today so i'm looking to get into the brain of robert herjavek welcome to the show thank you very much incredible intro uh you're way too kind it's true um And, you know, people always say to me when they meet me, you're the nice one.

2:03You're the tall one. You're the good-looking one. You're the tall one? Well, relative to Kevin and Damon and all this other stuff, not relative to Mark. And I always say it's a very low bar on the show. You know, it's funny. I did the Australian version of Shark Tank. Yeah. And in Australia, I'm the mean one. You are. You're the Simon Cowell of the Australian one. I am, because they're so nice there. Well, you know, the other thing, too, I want to tell you, and I was saying this off camera to you, You look great, which we should talk about towards the end today. Like, I've watched you over the years.

2:32You look better than when the show started. So I want to kind of pick your brain about a little of that, too. But when I got you here, I want to talk mainly about business. Love business. I want your mind a little bit around this. You've got the cybersecurity background. You've had exits. You've invested in all kinds of different businesses. It's no secret we're in this era of real innovation. And it's accelerating now, right? And so you have guys that are in the trades now, aren't earning doctors in some cases. And I'm wondering, from a business perspective, if you were to advise somebody where they're deploying time and capital, what are the places you would say, you're spinning your wheels there, this is not going to go?

3:07And what are the industries or places overall that you go? I think there's a bright future there. Yeah, so obviously my background is cybersecurity. I've been doing it since I was 21, just kind of fell into it. But in the last few years, I've really gotten very deep into AI. So I think we're going through a technological revolution. They'll be the greatest technology revolution in our lifetime. And I was there at the beginning of the internet, and I thought, in my lifetime, the internet, AI will transform everything. So, and just like anything, just like business, there'll be huge winners and big losers.

3:50And I think it's going to be very uncomfortable for the next three to five years. The places that I would stay away from are anything that's repetitive, anything that's mundane. What do you mean? Give me an example if you don't mind. Law clerks. Okay. You know, the basis of law at a lower – so if you think of a typical law firm, you've got clerks, you've got research analysts, and then you've got the lawyers up top. So everything up to the actual litigator, the relationship component, is going to get outsourced by AI. Case studies, what does it mean, all of that kind of stuff. So any kind of those administrative-type tasks, hugely valuable, but the key used to be who can find the best research.

4:37That's no longer a competitive advantage. On the flip side, anything that is mechanical, plumbers, I'm with you. You said earlier plumbers are earning doctors. I think you're going to see trades double in income over the next five to ten years. Because, number one, so few people want to do them, and it can't be replicated with AI. Is that a yet? Is that a yet? It can't be replicated with AI. Could you see a day where I have a guy right now that's exiting that I coach, and he'll actually be on the show so I'll wait to have him on but he's having a billion dollar exit from the trades garage door plumbing things like that and I asked him I said you know right now that those are safe do you see a day where there's some sort of robotics doing even that type of work I'm just curious what you would think about no no it'll never it'll never happen and I'm hesitating with the never because I think certain tasks up to the actual work can be replicated the scheduling the timing, the customer service, but that's not plumbing.

5:41The art of plumbing is understanding the infrastructure of a house, what's going on, that kind of stuff. And I also think human relationships become more valuable. The guy or girl who can sit down, talk to people, build a bond, AI is never going to replace that. Boy, I thoroughly agree with that. I just did a whole coaching call on it. I've had most of the sharks on. Really? Yeah. I've had Barbara. on? I've had Barbara on. I love Barbara. I love Barbara. Yeah. She kind of flirted. She was just on my plane. She just flew on my plane this morning from Miami. Oh, she did? And I'm like, how dare you use my plane?

6:17I think she's wonderful. I think she, no pun intended. I enjoyed our conversation and I did her show too, but I've asked them all this and I've reached this conclusion. And this is a hard question. I love Shark Tank. It's been so good to bring entrepreneurship front and center in the world, right? And it's made it a cool thing to do. It's made it something that more and more people are intrigued by. I think it's less mysterious than it used to be. But I wonder your thought, and I asked Damon this. I don't feel like he answered it completely. Sometimes I think it's done a little damage in this sense.

6:50So just stay with me, and I want your feedback on it. Everyone thinks they're an angel investor now. And there's so many people I know that have frankly lost a lot of money. It's also made entrepreneurs that are startups in a big hurry to raise money all the time. Prematurely, it seems like to me. And I'm wondering if most people wouldn't be more successful redeploying their capital in their own business or in something they understand and control and not so much angel stuff or VC type investing all the time because so much risk is associated with it. And I wonder if everyone understands that from watching the show.

7:25So best comment about Shark Tank anybody's ever said to me. I mean, really, really astute of you. first of all undeniable of what shark tank's done for america right and globally and the show runs in 54 countries you know i'm i'm the george clooney of portugal it's great um it's demystified being an entrepreneur it's it's taught america the language of business i mean think about it i i had never met anybody who'd started a business until i was 26 years old likewise and then i was like you own the business like the government thing like wow all of those things are positives there's two negatives of the show and by the way the positives far outweigh the negatives i agree but there are two negatives and the first one is a general negative with social media we have made it, we have made the pursuit of wealth seem like that's the goal of business.

8:30And we have made it seem like it's easy. And so you look at these social influencers, and they're flying around in a private jet, and they've got a Lamborghini, and there's all kinds of people that are, look at me, I'm successful on my jet, and on my fancy car. That is not the purpose of business. It is very rare in my opinion that I've met people who have built great businesses for a bigger paycheck. You're right. There's nothing wrong with money and I love money and I love toys and I love to spend it but I love creating value not just for customers but for the people I employ. So that's the downside because it seems so accessible it's made it seem easy for the wrong reason the second part of it as you say is like i just had lunch with somebody yesterday they wanted me to go into their business with them and i was thinking maybe i'll go in as a partner and buy 50 of it and the guy's telling me about and he's like you know we'll get it up to like 10 million arr and then we'll raise equity and i'm like why do we need to raise money right right and he looks at me goes well you know we could go out and raise 50 100 because that's what you do right Why wouldn't we just fund it?

9:49Why wouldn't we just use the cash flow from the business to fund it? And that is the downside of our show is I think I used to work for Warren Avis, the guy who started Avis Rent-A-Car. And he was this old, scraggly guy. I was just a young kid, didn't know anything. But he gave me an incredible piece of advice. He said, kid, if you ever start a business, your only payback is your equity. Yeah. Hang on to as much as you can, as long as you can. And on Shark Tank, people are giving up 40%. Why would you start a business and give up that much equity? So I'm with you. Okay. But in the light of having ignorance and understanding business, there's far greater good than bad.

10:41And Kevin and I argue about this all the time. And every business I've sold, I owned 100 % of. There you go. I funded it with credit cards. There you go. The other thing is if you ever watch the show, people come on and they'll say, I used my house as collateral. And the shark's like, oh, my God. And I'm thinking every business I started, I used my house as collateral. I love that. Exactly. I love that. Right. I do too. Because if it didn't work, it was my ass on the line. Yes. I have no problem with that. We had the guy on recently. I feel bad that I'm not remembering his name, but he was the president of Tesla for about a decade.

11:14And he shocked me on the show saying that they ran the company for a decade on three months operating cash. And I thought, and his theory with him and Elon was that that kept them lean and mean. It made them, they had to make strategic decisions all the time of where to deploy. I'm sure they could go into reserves when they needed to. But the point was it wasn't rich with cash all the time from raising money from people. And sort of, sometimes it can dilute the value. I think a lot of people don't even know what the term dilution means. You hear someone exited their company for, that's the other thing on social media.

11:42So-and-so had an exit for$60 million or$100 million. You don't know how many other investors there were. You don't know what their debt was. You don't know a lot, right? And that's one of the things that concerns me too. But I love the show. I asked Damon this and Barbara, so I'll ask you. Would you be wealthier had you not ever invested in any of the shows on Shark Tank and taken that capital and just deployed it in businesses that you controlled completely yourself?

12:09at the risk of sounding incredibly arrogant it's such a small amount of money relative to what I deploy that no no no not not really I don't think that sounds arrogant but I think the primary goal of Shark Tank if all the sharks are being honest is and there've been some huge winners and I've had a couple of big winners but really it's to help entrepreneurs most businesses that come on the show don't need the money. They need help. You know, when you're starting out and you're zero, 5 million, 10 million is 500 ,000, 200 ,000. Is it going to change the course? What you need is guidance. Which way do I go?

12:54Money wouldn't have helped me grow my business faster. If I look, I mean, my last company, I built it to what we were about $400 million from zero with my own money. Awesome. Would I have grown it faster if I had an investor? Absolutely not. Would I have grown it faster if I knew what I know now? Absolutely. I hear you. Like if I had you sitting there with me or Mark or somebody along the way, it would be a bigger business. See, what I thought you were going to say there, by the way, again, just acknowledge I agree that. There's that Chinese proverb, if you want to know the road ahead, ask those coming back.

13:31To find somebody. I've never heard that. It's good, right? And to have some sense of direction. But what I thought you were going to say, because I do think there's a lesson in this day and age. You and I are both feeling the same way about the influencer entrepreneur space. It concerns me about people not understanding how hard it is and how long the hours can be. And here's what I think. I thought you were going to say one of the keys for the show is that they're getting exposure through the show. Undeniable. And relationship or connections that you all have. And the lesson in that to me, and I want to ask you about this, is business when I was growing up was more about who you know.

14:08And I feel like now in this age, it's almost sometimes, sometimes, who knows you, right? And so would you give someone advice that's listening today to be growing their brand online? Or do you think that's industry specific where someone should be working on growing their brand and notoriety? Gosh, that's such a great question, Ed. And so first of all, undeniably that the platform of Shark Tank amplifies your business. Undeniable. Maybe in the first couple of seasons, but now just getting on Shark Tank is a big deal. So that's undeniable. It's funny. When I started my own business, there was two sage pieces of advice every smart person told me.

14:50It's not what you know. It's who you know. In order to make money, you need money. I had no money. My mom was a receptionist. My dad was a blue collar worker sweeping factory floors. I was screwed before I started. And I believe that. And that was my mindset. And I thought, as long as I'm great at what I do, people will find out. And I carried that for a while and then one day I realized no that's not true there is no thing as genius in the darkness of a basement the world is not going to be the path to your door you have to tell the world who you are now there's a line I think a lot of social media people go too far there's a line between branding marketing amplification and arrogance so I don't think you have to be arrogant about it but man you got to market yourself so yes the world needs to know who you are where to find you now the flip side of that is you're such a micro economy and all these things if you sell a product geared to a very niche industry it's easier to market to those people and they can find you so for what you want to do, the world needs to know that's you.

16:17That's a great nuance right there. That's really good. And I'm really glad we're doing this today. Actually, this is such a good conversation. Do you feel that everyone could learn to be an entrepreneur? Or do you think some people, there's just, I feel like if you cut you open or you cut me open or you cut most entrepreneurs that have some success. That's such a great question. You know, there's something in there. I don't know what it is if it's a relentlessness or a hunger i don't know what that thing is but i don't know that i don't know that everyone has that what do you think everyone has that okay um a good friend of mine was a priest and he gave me a great one of my best friends and he said when i was going through a really really rough time um i actually ended up uh living at the homeless shelter in Seattle for a while.

17:11That's a long story. Wow. And he was there and he said to me, you will never see anything in life as amazing as another human being. And I really believe that. And I believe if you cut me open, if you cut you open, if you cut everybody here open, everybody has that in them. What everybody doesn't have is the willingness to endure the pain that's required to get to those goals. Everybody wants to be successful. Very few people are willing to pay the price. So good. And it's so true. Whatever your thing, it could be anything. Canva helps you make that thing a thing. Canva is a simple online tool thing.

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18:39Gemini and Chrome is here for it. Ready to make anything online make sense? There's no place like Chrome. Check responses set up required. Compatibility and availability varies 18+. When I was younger, I wanted to be rich. I mean, who doesn't want to be successful? Nobody wakes up purposely and says, I want my life to suck. That's a defense mechanism. Anybody who says to me, oh, you know, I wouldn't want that. That's a defense mechanism. But I think eventually you get to a point in your life where the pain of how you're living, you're either willing to accept and complain or endure or you got to change it.

19:23I wasn't born an entrepreneur. I just I just didn't want to live like I was living. Like I just the pain of it was too great. And so you learn and you you screw up and you're bad at it. But you keep going. So to your point. Yeah, it's in every you don't have to be a great athlete. You know, we talked about Tom Brady before. I'm pretty sure Tom Brady was born with a certain physical skill set. I'm sure he worked really hard and was really determined. But to be an entrepreneur, you don't have to have any skill set. You don't have to be able to sing. You don't have to be able to dance. You don't have to have any physical ability.

20:03There's fat ones, skinny ones, good-looking ones. I mean, it ranges the entire spectrum. The commonality is the willingness to endure pain for a greater purpose. and so if I cut you open do you have a greater purpose are you doing it to make a paycheck because those things are very superficial you're right so if you want to make 100 grand you're making 50 and then you get to 100 grand what what do you do then you you change your goals to make 200 to me it's it's empty it's funny I wonder if this is you now too I did it in the beginning well I wanted to be rich just like you said but then I found out you better have a greater purpose through the dark times because the absence of that thing you want is going to endure for a really long time so there have to be other reasons right as i've gotten a little bit older because you just said i don't sing or dance or anything to some extent and i really like it this way my entrepreneurial journey now is almost like my art form my form of expression almost in other words i can't sing or dance but the things that come with being an entrepreneur is sort of become like a form of expression for me teaching it living it coaching people mentoring people do you i think i see that in you though too same like i i find my ability to see the world and the disassociated pieces and have it come together i think of that as an art form now now do i do i think that or because i'm not good at anything else i think that maybe but listen i always say to my wife who's an incredible artist.

21:42I mean, thank God I had no talent for singing. Because if I had even a little bit of talent, I'd be super broke but happy singing Eagle songs in a bar. By the way, my son's here today and I've told him all this time, I'm really, I don't have any great talent to fall back on. So I had to learn to really work hard. I mean, I think I have certain superpowers in terms of my strength or resiliency or those things. I think that's pretty good. What is your greatest superpower? I was going to ask you yours, which is far more interesting than mine. I'm curious to see what you're going to say. Well, I got to tell you, I hope this sounds with the humility that I mean it to sound.

22:26I think it's my ability to connect with people, and I love people, meaning whether that's one-on-one in this sort of environment here or stage being on a stage and speaking or being in a boardroom or back in the day, being able to sell. I think it's my ability to connect with people and sincerely believe in them. Like I, sometimes my family will tell me one of my great strength is how much I believe in people, see them as they're going to be. And oftentimes they'll tell me, yeah, but dad, that's not who he is right now. You know? So I think it's, I think that's probably my I don't think I have super high IQ I think I have pretty good EQ though I would say that it's probably very very good with people obviously I mean you're you're very engaging thank you what do you think yours is adaptability on 100 I mean I'm I'm very good but you are you're tremendous with people that was a skill set I had to learn because I was really bad at it but the one thing I did have naturally, just through being beaten down all the time, was the ability to get up.

23:28And Damon and I talked about this. I think if you threw me in the middle of a jungle or in an environment I didn't know, I'm highly confident I would survive and figure out the game. So it's not about how you do. It's about, you know, what's the Muhammad Ali saying? It's not how many times you get knocked down it's how quickly you get up and the amount of pain and negativity that was thrown at me when i was starting out never i mean affected me yeah but i never shook me to my core it never stopped me from getting up the next day you never quit you never had this impulse at some point to go hands up done no never I've had really crappy days I've cried I've been in physical pain because I was so scared but it never stopped me and I developed this mindset because it was so hard that success wasn't about big steps.

24:35Success was one inch at a time. Yes. So on the days where it seemed like the world was against me, where the pain was so great that it was physical, as long as I moved an inch, like even a half inch, constant forward momentum. I've been saying that in my mind since I was 22 years old. I love you, brother. We're kindred spirits. My book, the last book I wrote, it's called the power of one more. And it's about being one more decision away, one step at a time, one day at a time. I got it from my dad. My dad got sober when I was 15. And remember when my dad got sober, I said, dad, you never going to drink again?

25:15And he said, Eddie, I can't promise you that, but I can tell you I'm not going to drink for one more day at a time. Oh my God. I love that. And when I was going to quit once, I was going to quit once like all the evidence said I probably should and my old man wise in his sobriety and my dad never made a ton of money in his life but he was a confidant and a wise man and and he said you know just don't quit for one more day just wait till tomorrow see how you feel it's funny my dad was an alcoholic for many many years and I always remembered and I'm the only kid and you know we came here on a boat when I was eight years old the whole nine yards what a story and i always remember my dad could never quit and the consistency in his inability to quit was grand statements i'm gonna stop forever i'm never going to do this like every time it was a big gesture and i think that got ingrained with me when i started out in business it'd be like Like, oh, we're going to do blah.

26:20And you learn life is not about grand gestures. Life is about consistency. It's about all the stuff that people don't see. You know, it's like one day you wake up and you sell a business for 500 million or 10 million or whatever it is. And people think, wow, what they don't see is the 18 years, the 10 years of every little half inch of steps that took you to get there. It's hard. This is such a good conversation. By the way, just as a friend, I tell you, your face really changed when you said that about your dad. Oh, it was hard, man. Like it was really like I think, you know, we talked about purpose.

27:02And my dad was a complex, tough guy. So was mine. But what I realized somewhere in my 20s, because I started a business and it wasn't super successful, and I started getting envious. None of others. I started getting envious of why not me? Why is that guy driving a Ferrari and not me? Why is it easier for them to get to$10 million? I'm stuck at$2 million. The why, the envy. And then I just kind of sat back and I realized that my parents had given everything to me to have this opportunity. So when I couldn't do it for me because I wasn't focused enough, I said, I got to become successful, whatever that meant then, for them.

27:58My dad escaped the communist country at 37 years old with one suitcase, crossed the border to Italy. We came on a boat. He left the country with no money, didn't know anybody, and left his entire world to give me an opportunity. And there I am bitching about how hard I'm working. It just changed my entire filter. I mean, eventually you have to have deeper goals, but yeah. What an unbelievable answer. You have something that I love in people, and I wonder if you're aware that you have it and then maybe describe it your way. You are a very confident man. However, you carry a tremendous amount of humility with you.

28:44And I think it's one of the secret formulas for, first off, good people and good friends, but also longevity in business. Let me tell you what I mean. You and I both know very confident people who don't have humility. They usually make a mistake at some point to blow themselves up, financially or otherwise. Or they just don't have the sort of peace and happiness that I'd see in someone like you. I wouldn't agree with the first. I would definitely agree with the second. And there's a differentiation between success in business and success in life. That's what I'm referring to. I know, and I think this is hard for most people because business is not always fair.

29:28I know not very nice people who are successful. Financially. Yes. Right. I know not very nice people who've built big businesses. So do I. And I wouldn't want to have dinner with them. Right. I wouldn't want to hang out with them. I don't want to associate with them. I respect that one narrow part of what they've done, but it's not a successful life. That's what I mean. And I always wanted to have a successful life, which means a certain amount of money. I mean, that's just the reality. In America - One of the boxes. Yeah, you've got to have a certain amount of money. It doesn't have to be a billion, but it can be whatever you need.

30:10but if my kids hated me or my wife didn't love me or if I was never home like why would any of that money matter that leads me to believe we do agree we're just I think you thought I meant just financial success I did yeah yeah and I don't I don't you're you had that mentoring when you were young about how much people my mentor when I was young kept repeating to me because I need simple concepts he'd say Eddie people matter things don't people matter things don't and it's not that having things isn't great you and I both have a lot of things and it is cool to have things yeah but I have found that though that's not sustaining joy for me sustaining joy for me is the people in that home same it's so funny you say that because people that don't know me always think I'm about you know the cars because I used to race cars and I love airplane like I I love to play yeah but what I love more than the things is the joy of life like you know another thing my priest said you can wake up every day and believe everything is a miracle or you can wake up every day and believe nothing's a miracle i am full of joy you are i love to play i love my family like i like i just go all the time yeah but um i think i wasn't this in my 20s or 30s i was always full of joy, but I worked really hard to get here.

31:35Like there's no balance for it. Yeah. And that's the question. And so I think I know what you're going to say, but it really, you know, pause for a second on this one. Is it worth it? And I know your initial reaction will be definitively yes. And maybe after some thought it will be as well. But what I mean by, is it worth it is you and I are both, you know, we're not 23 anymore. It's a Saturday. We're in Boston today. We both travel a bunch. We're on the road a lot. There's a little scrutiny that comes with being a public person. your phone blows up every single day just like mine does right and and so there's a lot that comes with being an entrepreneur and continuing down that journey all the way continuing to climb the metaphorical ladder of life do you ever evaluate is this worth it at this pace because you do seem to be very joyful and very happy but if someone asked you that like truly robert is this all worth it or was there a level where it was definitely worth it to there but maybe there's diminishing returns beyond a potential point?