HBO to $50,000,000: How I Built a Fortune, Lost Everything, and Reclaimed My Life | James Altucher

0:00We all have four bodies, physical, emotional, creative, spiritual. And just like the physical body has blood flowing through it, and if the blood stops at any point, you get a heart attack. But there's also each body that you have, a creative body, emotional body, spiritual body, also has a kind of blood to it. But also there's a kind of blood that flows between the bodies. And if there's any blockage at all, you're going to fail.

0:27What would happen if we just told the truth? Welcome to TruthWorks, where we dig into the nitty-gritty of leadership and work. And what needs to change. I'm Jessica Neal. And I'm Patti McCord. Our journey together started in HR, but trust us, it's evolved into something wild, honest, and, well, a bit rebellious. So throw out the handbook. We're here to redefine rules to work for us, not against us. Let's dive into another episode.

1:05Hi, everyone. Welcome to another episode of TruthWorks. I'm Jessica Neal, your host. And today I'm here with a fascinating guest, James Altucher, is someone founders either tend to quote constantly or quietly read when things are falling apart. James has built and sold companies, lost millions, rebuilt, has been on the floors of the depths of despair and come back many a times. I'm not quite sure how, but we're going to find out all about it today. James, welcome to the show. Thank you so much for having the show. I'm a big fan and I admire what you're doing and I'm glad to be here. Yeah, me too.

1:48Well, I don't know. I think many of my listeners probably know your story, but let's, let's tell it a little bit because you have, I guess, over time failed and failed big where you, I think you had like, I don't know, close to 50 million in your bank account. And then months later, like$46 or something. Yeah. Those numbers are pretty close. Yes. And you were very depressed, which I get. So just tell us, take us through your story. You and I were talking before we started recording that, you know, it's such a small world. You were at HBO in your beginnings and I was at Netflix and our worlds are like colliding in a different way now with this whole acquisition that may happen soon.

2:38So tell us the James story. How did this all start? yeah i mean it kind of started at hbo actually where i was working in the it department at hbo which is the least respected department at hbo hbo is an entertainment creative company the it guys put them in a different building we didn't even work in the hbo building put them in a different building we don't want to see them hear them we just need them to like make things work and from there though this was like in the 90s nobody maybe like five people in new york city knew how to make a website. And I fortunately was one of them. And I'm not even exaggerating.

3:16There were literally five people who knew how to make a website. We all knew each other. We all started companies making websites. And I had started making HBO's website. But then while I was a full-time employee at HBO, at night, I had my own company making websites for AmericanExpress.com, almost all the movie studios, all the record labels at the time. I made websites for them. So I built up a fairly big company. After 18 months of doing both, working full-time at HBO and doing my company, it was called Reset, I left HBO full-time, kept HBO as a client, but had many other companies as clients, eventually sold.

3:54And as you said, I had a lot of money in the bank, generational wealth. And I don't know, I thought sometimes when you think you're smart at one thing, you think you're smart at everything. And I figured, oh, I'm so smart. I made all this money. I'd be a great investor. And at the time, this is again, like late 90s, early 00s, I knew nothing about investing. I have since done a great study of investing, but at that time, zero. And I lost everything. And I was so stupid about it. And I regret it deeply for many reasons. And I lost everything. I got depressed, lost family, lost house, lost everything.

4:33My life had to really change in a lot of ways. That was painful. And I, and I, I never thought I would be able to, I wasn't really entrepreneurial, at least at the time, or I didn't think I was. The reason I really wanted to get into HBO, for instance, through the back door, the IT department was because I wanted to make TV shows. Like anybody who works at HBO either wants to like write novels or makes TV shows or anyone who works any entertainment company has some secret dreams. And that's what I wanted to do. I didn't want to be an entrepreneur, but I ended up doing it. I ended up falling into it and I ended up getting this, what I call now the sickness, which is once I made 10,$15 million, I figured, oh, everyone else is making 10,$15 million, which was not true, but that's how my mind worked.

5:18And I figured I'm going to be poor unless I make a hundred million dollars. So that forced me to take greater risks than I should have and not really respect the money that I had. And the psychology of money was really warped inside of me. And I ended up losing everything. Money, there's three skills to money, making it, keeping it, growing it. And I had the ability to make it, but not keep it or grow it. There are different skills. And so eventually, though, I was able to build back, start other companies. But then I got in this cycle where I was making it, but I wasn't respecting the keeping it and growing it.

5:56And I just had to learn a lot about a lot of things, particularly about myself, to really uncover what was happening in order to successfully live life. It's not about making money. It's about how do you succeed? We only have this one life. How do you successfully live life? Now, of course, money can buy a lot of things related to freedom, but it could also bring a lot of misery as well. Yeah, I can. So what are these lessons that that you learned on sort of the, you know, respecting and keeping side? You know, it's interesting because so I've been writing about this topic for probably about 15 years.

6:35And when I first started writing about this, it was a very taboo topic. Like right now, I would say failure is the main topic entrepreneurs write about. And I respect that. But at the time, nobody was writing about it. And I would write these stories and books. I wrote several books about this topic. And people would write to me afterwards and say, you can't write this. Nobody's going to ever trust you again with money, even though they see the lessons I've learned and how I've educated myself and so on. They say no one's going to ever trust you. And it turns out that by writing about these things, A, I built up quite a sizable audience.

7:13And B, I end up having more opportunities than ever because actually more people trust me because I'm being honest about the ups and downs. Everyone goes through ups and downs, maybe not with as extreme volatility, sometimes with more volatility, sometimes with less. But these are like people, two types of people would write me. They would say, you know, dude, you can't write like this. No one's ever going to give you opportunities again. And then other people would write to me and say, hey, I'm glad you're writing about this. I never told anybody, but this, this and this, you know, happened to me.

7:44And it's really helpful. Thank you. And so it was interesting to see these kind of subterranean depths of the financial world that, you know, where we all have experienced these things. And so the reason I say this is because a lot of what I say now that I wrote then is almost going to sound like cliche because a lot of people have since, you know, this failure kind of category has become more mainstream, of course. And so I viewed it in a very kind of weird way. I viewed that we all have four bodies, physical, emotional, creative, spiritual. And just like the physical body has blood flowing through it, and if the blood stops at any point, you get a heart attack.

8:29But there's also each body that you have, a creative body, emotional body, spiritual body, also has a kind of blood to it. But also there's a kind of blood that flows between the bodies. And if there's any blockage at all, you're going to fail. So you're going to have a heart attack of some sort, an emotional attack, a spiritual attack, a creative attack. And so you have to keep everything flowing smoothly on a good, let's call it frequency. So physical body, we all know, sleep, eat, move, slash exercise. Emotional body, really cater every day, not just occasionally, but really cater every day to your relationships and your understanding of relationships.

9:12and that's hard. That's really hard. It's just as hard as physical health. Like even if you're married in a happy relationship, you know, which is sort of the dream, you're going to have communication problems where, you know, this person's here and this person's there. You have to work on these things or else you're going to get an emotional heart attack and you won't be able to, you're not going to, if you're going through a fight with your partner, you're not going to be able to come up with creative ideas that day. So it's just, you're not going to do or you're not going to act on those ideas.

9:42Same thing with what I call the creative body. And I had this exercise I would do every day, write 10 ideas a day down. Yeah, I think I saw you bought all these waiter pads or notepads. I used to take these really long walks every day because I was broke and had nothing else to do. And I was desperately trying to sell a house before the bank would take it away from me. And I wandered into this restaurant supply store and there were 100 waiters pads available for$10. So 10 cents a pad. And I've been using them ever since. I don't know where my pads are right now. And every day I take one out and I write 10 ideas down.

10:22Now, very critical. Does not have to be 10 good ideas. Could be 10 horrible ideas. The whole point is to put in, is the consistency. Is to put in the, you know, the creative muscle is a muscle. And if you don't use it, it atrophies like any other muscle. It atrophies very quickly. So you have to build it up and strengthen it. And you do that, again, not by writing 10 good ideas a day down. That's impossible. That's 3 ,650 great ideas a year. No one does that. And Einstein can't do that. So just 10 bad ideas a day down, and that's how you build up that muscle. And I noticed my entire mood got so much better in just two or three weeks of doing that.

11:02And then maybe after two or three months, I actually was coming up with good ideas. And it changed my life. It's changed my life over and over again so many times. This one practice. If I had never done this practice, I don't know what would be happening. Do you walk every day when you're doing it? No, I'm writing them down. So I usually go to a cafe or something and I'll get my coffee, coffee right here. And I would sit down and write down 10 ideas. Like I remember the first list of 10 ideas I wrote actually was I wanted to write a book. And this is a bad idea. I wanted to write a book about how to beat everyone at every game.

11:42And so, for instance, Scrabble. If you know the Q without U words, you have a big leg up on everybody else in Scrabble. If you know the legal X words, if you know all the three-letter words or all the two-letter words, you're going to have a big leg up. monopoly if you know to buy the orange properties you're going to be have a big leg war up on everyone else so i'm really into games and i wanted to make this book i never wrote the book i just wrote this list and but that was my first list a list of bad ideas and what's the best idea that you've written down so far i mean now i've been doing this for over 20 years so i've written many many good ideas like what's your favorite i mean that one actually was my favorite even though it's like bad ideas and that's why i remember it so well it's that bad of an idea well and i did some research the next day i was like what why should i write this book well it turns out during times of recession which we were going into at that time board games outsell you know movies and because people want to stay home and be entertained yeah so it wasn't a bad idea but i just i just never did it and but i was i've written lots of good ideas you know this past Last year has been an amazing year, for instance.

12:54I'm helping manage three different public companies that all came out of, every single public company came out of an idea list that I initially wrote of, this would be a good idea, X, Y, Z. And then I would present to a public company that was sort of lagging or not doing so well, and they would change their strategy, make a deal with me, and I would be able to implement my strategy that came out of a 10 ideas a day list. You really can manifest things in your life. It's not just about the law of attraction. Like when you write something down, it focuses you. And then the next day, here's 10 ideas.

13:27I'll pick one. Here's 10 ideas to execute on this one idea. And then on those execution ideas, oh, here's 10 ideas that I need to implement to execute on one of those ideas. And so the idealists really kind of, you know, an idea that works will eventually branch out into a tree of idealists. And so stuff like that has worked. Every company I've ever started has come out of these idealists. Every book I've ever written, the table of contents started off as an idealist and so on. So I really attribute any possible success or failure I've had to idealists. Yeah, I love it. I think it's, I think you're right.

14:07I think, you know, sort of being healthy on all those dimensions really matters. And, you know, when you think about when you're off in your personal life, when you're off in your work life, one of those things isn't working well right and it's impacting all the things and so you have to it's just like going to the gym you have to work on your emotional state you have to work on your physical state you have to work on your creative state like all of those things matter they're muscles you're absolutely right and look we can't be perfect every day like obviously people are going through divorces people are going through bad relationships people are maybe traveling a lot so it's harder to exercise some days or maybe they're having some spiritual crisis.

14:52But just being aware of this and doing what you can, putting your best foot forward, starting each day fresh without the baggage of the day before, if you can do that, which is very hard. These are all critical things. I think like at the time when you were at your lowest, was it also just shame that was getting in your mind? Oh my God, so much shame, so much. And it's not just one time. This has happened to me in 2009. It happened to me in, I don't know, 2015. It happened to me a little bit. Even when I was already like, I sold several companies and was successful. I was having some issues in 2020, not exactly the same.

15:35But I remember the first time, though, I went broke. I was so ashamed. I remember I put my house up in the New York Times. I put it up for sale. And then the real estate agent put it in the New York Times real estate section. And I was talking to a business partner. And he's like, James, we saw your house in the New York Times real estate section. And I'm like, really? That's impossible. My house is not for sale. Now, of course, he knows I'm lying because someone had to pay to put an ad of my house. No one would just do that. But I was so ashamed that I couldn't figure out what to say. I just blatantly lied, which was so stupid.

16:12Like he's just smiling and he's like, all right. And I was ashamed. And I've been ashamed every single time. It's just like when you get a divorce, there's many reasons to be ashamed. Oh, I couldn't make a relationship work. Or people are going to think I'm not a good person. Or people are going to think this, this, this. Everybody's going to make judgments that you can't control, which is obvious. And, you know, shame happens in a lot of ways. And I used to tell myself I don't care what people think. And I've realized somewhat recently, I probably actually care a lot more what people think than I thought I did.

16:45So, I mean, we all do. You know, I don't know. I think it's just a human trait that we can't get rid of. We're tribal. We want the tribe to like us, you know? Yeah. And you need the tribe to survive, I think. Right? And if you're sort of pushed out of the tribe, you're not going to survive. And so I think we naturally care. But maybe there's, because I think you've reframed some of your thinking around, like, maybe shame, for example, or failure. And it's more about experimentation and learning, but also, like, not tying your whole identity to money or success or is, I don't know, what are your thoughts there?

17:29it's interesting because you got to be very careful because obviously money is necessary to live and and and to give you choices and options oh i want to move from kansas city to london for a year okay the more money you have the easier it is to make a choice like that it's not a requirement to have a lot of money to make a choice like that but again with choices like that Yeah, exactly. My six-year-old the other day, he came home from school and he's in kindergarten. And this little girl at school, he was like, Mom, Irene. And she goes, she said her dad takes all their money out into the backyard and throws it in a big hole.

18:14And that he just doesn't care about money. And I said, oh, well, that's interesting. And then he goes, how can you not care about money, mom? Like money's great. I was like, yeah. It's true. Money can buy candy. Like little kids get it right away. So, but at the same time, we'll only have one life and you need, and the energy and mechanics of making money can only happen in so many ways. Like if you're really, if you really love poetry to the extent where it fills your mind and you want to do it as more than just a hobby, you can't also tell yourself you want to be a billionaire. I mean, you can, and it's possible.

18:57You could be an investor somehow and figure it out. But chances are poetry is not going to be tied to making billions. And you have to also do what you love. Like there was this period from 2015 to about 2021 where I just loved and I was obsessed with stand-up comedy. And I even bought a comedy club in New York City. I started performing every night, often two times a night. And during the day, I mean, I had other work to do, but during the day as much as possible, I would watch stand-up comedy videos. I would study the art form, like really study it. I can see this. I can see this. I would listen to each comedian like where are they pausing?

19:37How are they working with the audience? How are they working the stage with the microphone, the room? What's their writing like? What's the styles of each comedian and how do they change their writing style and how do they do crowd work? And I would just study this and then at night I would try things and take the videos of it and watch the videos and then go back and read. So you're not going to be a billionaire if you spend six years of your life like that. even if you're working other businesses and so on, you're not going to be optimized. And that's true. Perhaps I could have made a lot more money during that period if I was obsessed with something that makes me, if I was obsessed with making a rocket ship that goes into space, for instance.

20:17I'm not saying I could have done that, but I'm saying there was other ways for me to make money. But you kind of, it's really hard to be successful at things you're not passionate about. and I tend to go all in when I'm passionate and I've gone all in on things like writing, stand-up comedy, playing chess at an adult level, doing lots of things that aren't necessarily related to making money. So I probably haven't, I'm not a billionaire, I probably haven't optimized what I can make given that I have an entrepreneurial instinct but you know you just can't deny yourself either like we only have one life so you have to figure out how to balance that so you don't go broke and so that you do make money, particularly if you have that skill set.

21:00But at the same time, you can't deny who you are and you can't deny the things you love and are obsessed by. Yeah. We have a lot of founders that listen to this show and you work with lots of founders, right? And you are one. And so what is your advice for those founders that are listening that maybe have started something, it's not obvious it's going to be successful, but they're incredibly passionate about it. They think it's going to be, make a difference in the world. What, what, what do you tell them? Well, first off the whole thing about the four bodies, you know, go to the gym, sleep eight hours, eat well, like if possible, don't smoke, don't drink.

21:43Cause you want to be healthy. Yeah. Make sure, you know, I've, I've, I have a podcast as well. I've interviewed 1500 of the most successful people of all time, you know, try as much as you can. You might not be in one now, but try as much as you can to have a good, positive relationship or set of relationships in your life and on and on. And really write the 10 ideas a day. Again, it doesn't have to be good ideas. Don't feel anxious about executing every idea instantly. It's just get the wheels going. Get that creative muscle built because you're going to need it. Because a successful business is successful in part because it's doing something nobody else has ever done.

22:23And to do that, you either have to be lucky, which is very hard, or you have to have a very built out creativity muscle, creative muscle. And you're going to have to come up with things and ideas that nobody else is doing. That's how you stand out. And that's very important. And then you have to also fail fast. Like if you try an idea and it's not working, sure, maybe it'll work if you put a lot more effort into it. You don't know, but be willing also to shut down an idea or a business even and start something new. Like I have almost every year I start up and shut down lots of lots of ideas. They might be new businesses or they might be parts of another business.

23:04It doesn't matter, but just try lots of things. It's important though, because I think a lot of, not even founders, but people in general companies and general organizations have a hard time of quickly letting go of something that's not working. Right. And you hold on to it way too long. And that really prevents you from getting to that next thing that is actually going to be massive and important. Right. But you you're holding on to this thing that's dragging you down and it's never going to go anywhere. absolutely and part of that is you have to have a feeling of abundance so you have to tell yourself this is not my last idea so so it's okay if this idea fails you know it's sort of like a bird you know a mother bird with her children you do the best you can you you you hatch the birds and then you throw them out of the net they might die when you throw them out of the net Yeah.

24:09And if they die, you don't have a funeral. It's just that one's dead now. Like, you know, now you have to, it's the same thing with, with your ideas and with ideas in a business, like some things just aren't going to work. But at the same time, if you keep coming up with ideas, you're going to be abundant ideas. You'll, you'll have plenty of opportunities for success. The other thing is to keep in mind is that every idea and business can be sliced and diced in a variety of ways. Like, let's take your podcast as an example. Okay, you know, you have all, let's say you have 20 entrepreneurs on your podcast.

24:45Well, now you have the TruthWorks Legends book that you could write, which is the edited transcripts of everybody, you know, maybe divided by category, like here's sports entrepreneurs, media entrepreneurs, financial entrepreneurs, and so on. So it's, yeah, and then, you know, So you could even make, you know, there's obviously there's Instagram, YouTube, TikTok, LinkedIn. There's a variety of ways to kind of slice and dice your content to build audience. And these are just, you know, a few ideas that are sort of, you know, obvious. A lot of podcasts do these things. And but but to keep on slicing and dicing your material, you could you could speak at conferences.

25:22Maybe every podcast is a book somehow. You write a book about off of this one. and just keep slicing and dicing all the content that you have to make more product and get the word of yourself out there. So everything is like that. I started a public company recently. When I say started a public company, I contacted someone I knew who was running a failing public company. And I said, hey, how about transition your strategy to doing this? And this involved some particular crypto token and buying it in the open market and rebranding across this token. It was a failed Alzheimer's drug previously was the company and they switched their strategy.

26:02They had a lot of cash left and I started putting the cash to work for them. And then we slice and dice a little bit. Oh, nobody really knows about this cryptocurrency. Let's make an entire media site, like a news site, hire an editor, get journalists. That's all just reporting on this cryptocurrency. Now we'll sell ads on this site and build that out as well and do a podcast around it. So again, so more and more people know about us and also about this cryptocurrency and why it's so great and bring in members of the community of that currency. And it's kind of like this virtuous cycle effect.

26:33And so again, taking an idea and just figuring out as many ways to slice and dice it is a useful tool for entrepreneurs who feel a little bit stuck, as well as failing fast. So if that site had not worked, or didn't get a lot of traffic, okay, drop it done. Call on to the next idea. Right. I love the slice and dice. I'm going to slice and dice after this show for sure. Okay. So you, I think, I think you've said this, that freedom is often scarier than failure. Have you said that? That could be. It sounds like something I would say. I'm trying to think of, you know, I actually, I don't know if I've, if I've said that.