What I learned from reading The Billionaire and the Mechanic: How Larry Ellison and a Car Mechanic Teamed up to Win Sailing's Greatest Race, the America’s Cup, Twice by Julian Guthrie.----Come see a live show with me and Patrick O'Shaughnessy from Invest Like The Best on October 19th in New York City. Get your tickets here! ----Subscribe to listen to Founders Premium — Subscribers can listen to Ask Me Anything (AMA) episodes and every bonus episode. ---[0:01] Larry Ellison to Steve Jobs: I’m talking about greatness, about taking a lever to the world and moving it. I’m not talking about moral perfection. I’m talking about people who changed the world the most during their lifetime.[0:56] Larry’s choice for history’s greatest person could not have been more different from Gandhi (Steve Jobs’s choice): the military leader Napoleon Bonaparte.  [3:15] Steve liked to say the Beatles were his management model — four guys who kept each other in check and produced something great.[3:47] Larry’s favorite history book was Will and Ariel Durant’s The Age of Napoleon, which he had read several times. Like his buddy Steve, and like Larry himself, Napoleon was an outsider who was told he would never amount to anything.[6:09] Now the book is technically about the America’s Cup race. But that is not really what it is about. This books gives insights into extreme winners.[7:50] Steve and Larry had found they had much in common. They both had adoptive parents. Both considered their adoptive parents their real parents. Both were “OCD,” and both were antiauthoritarian. They shared a disdain for conventional wisdom and felt people too often equated obedience with intelligence. They never graduated from college, and Steve loved to boast that he’d left Reed College after just two weeks while it took others, including Larry and their rival Bill Gates, months or even years to drop out. [9:09] Steve Jobs: “Why do people buy art when they can make their own art?” Larry thought for a moment and replied, “Well , Steve , not everyone can make his own art. You can. It’s a gift.”[10:46] What he (Steve Jobs) liked was designing and redesigning things to make them more useful and more beautiful.[11:02] If Michael Jordan sold enterprise software he would be Larry Ellison. Larry is addicted to winning.[12:38] An idea I learned from Steve was the further you get away from one the more complexity you are inviting in.[13:20] Larry was a voracious reader who spent a great deal of time studying science and technology, but his favorite subject was history. He learned more about human nature, management, and leadership by reading history than by reading books about business.[14:52] His adopted Dad said over and over again to Larry, “You are a loser. You are going to amount to nothing in life.”[15:19] Larry treats life like an adventure.[15:26] He envied how Graham’s parents supported him on his adventure, as this was the opposite of his own life. The story of Graham transported Larry from the regimentation of high school to the adventure and freedom of the sea. Here was a boy alone at sea for weeks at a stretch; dealing with storms, circling sharks, and broken masts; visiting exotic locales. Through it all he was his own navigator.That is definitely the way Larry approached his life.[18:04] Why Larry uses competition as a way to test himself: He wanted to see just how much better a sailor he had become. It will be an interesting test. There was a clarity to be found in sports that couldn’t be had in business. At Oracle he still wanted to beat the rivals IBM and Microsoft, but business was a marathon without end; there was always another quarter. In sports , the buzzer sounds and time runs out.[18:50] It is not what two groups do a like that matters. It's what they do differently that's liable to count. —Charles Kettering[22:20] Why test yourself: After the laughter died down Larry turned serious. “Why do we do these things? George Mallory said the reason he wanted to climb Everest was because ‘it’s there.’ I don’t think so. I think Mallory was wrong. It’s not because it’s there. It’s because we’re there, and we wonder if we can do it.” [24:11] Larry’s personality: He didn’t like letting them have control. It was the same reason he didn’t have a driver, and it was why he liked to pilot his own planes and why he had been married and divorced three times. He didn’t like being told what he could and couldn’t do.[26:04] With any new thing you do in your life, you are going to have to overcome people telling you that you are an idiot.[28:08] While Ellison demanded absolute loyalty, he did not always return it. The people he liked best were the ones who were doing something for him. The people he hired were all geniuses until the day they resigned—when in Ellison's view— they became idiots or worse.[29:44] What Larry is reading during the dot com bubble collapse: The books on his nightstand included Fate Is the Hunter: A Pilot’s Memoir by Ernest Gann, The Jordan Rules by Sam Smith, and William Manchester’s multivolume biography of Winston Churchill.[30:25] Whenever Larry felt remotely close to being at risk of failure he couldn’t stop working. [30:58] I’m going to read you one of the funniest paragraphs I have ever read. The guy Larry is talking to is insane:In the dot—com heyday he got a call from Farzad Nazem, who used to work at Oracle and was now a top executive at Yahoo. Nazem told Larry, “Disney wants to merge with us. Why would we ever want to do something like that? What have they got?” Larry answered his old friend, “Gee , let me think. They have the most valuable film library in the world, the most valuable TV channels in world, and successful theme parks everywhere. Disney makes tons of money and they’re probably the most beloved brand on the planet. Now, what have you got? A Web page with news on it and free e-mail. Has everyone gone crazy ?”[32:38] Oracle has been around for 40 years. How many companies can survive 40+ years?[33:00] One of the key insights I took away from Larry is this idea about game within a game. I'm glad I'm reading these books about Larry Ellison at the same time I watched this 10 part documentary on Michael Jordan (The Last Dance) because I think both Jordan and Ellison figured out something that is fundamental to our nature.I don't think hey were not setting out to try to figure out something fundamental about human nature. They did so in their own process of self discovery.They hack themselves by creating games within games.They understand over a long period of time that your motivations, your dedication, your discipline is going to ebb and flow and they had to find a way to hack themselves.[38:19] There is one sentence that sums up Larry’s personality: “Winning. That is my idea of fun.”[38:38] There are a lot of extreme winners on Larry’s team. That is one of the things I like most about the book. It gives you insights into their mindset, how they prepare for their sport—which I think is applicable to whatever you do for a living.[40:00] Dixon said, “Larry, my advice is that we go out there tomorrow to try to win the race. We will probably get beaten and you should be prepared to lose gracefully.” Larry was stunned by the suggestion. After a long pause, he said that he could be gracious after losing, but wasn't capable of being gracious while he was losing, he had come here to win.[42:00] The Vince Lombardi line Larry loves: Every team in the National Football League has has the talent necessary to win the championship. It's simply a matter of what you're willing to give up. Then Lombardi looked at them and said, I expect you to give up everything, and he left the room.[42:25] Give me human will and the intense desire to win, and it will trump talent every day of the week.[43:05] His lack of interest in marriage was not about fidelity, but had more to do with problems he had with authority. In marriage, he had to live a good part of his life the way the other person wanted him to live it. Larry wanted to live his life his way. This part reminds me of what we learned on the podcast I did on Frank Lloyd Wright.[44:17] His favorite Japanese saying was, “Your garden is not complete until there is nothing else you can take out of it.”  [44:44] Rafael Nadal asked how Larry had made his life such a success. Larry launched into a long philosophical musing about how innovation in technology is quite often based on finding errors in conventional wisdom, and when you find an error you have to have the courage take a different approach even when everyone else says you’re wrong. Then Larry abruptly stopped himself. “Forget everything I just said. The answer is simple. I never give up.” [46:09] He was incapable of waving the white flag.[46:24] Kobe Bryant: A young player should not be worried about his legacy. Wake up, identify your weakness and work on that. Go to sleep, wake up, and do that all over again. 20 years from now, you'll look back and see your legacy for yourself. That's life.[46:47] Larry is constantly willing to put himself in uncomfortable situations so he can improve.[49:00] One of Larry’s favorite maxims was: “The brain’s primary purpose is deception, and the primary person to be deceived is the owner.”[49:07] How does his favorite Maxim relate to why he likes sports? Because in sports, you can't deceive yourself. He just said the brain's primary purpose is to deceive yourself—so he needs to hack himself. He needs to have his game within a game, so he is incapable of deceiving himself. Larry liked having opponents, even enemies. “I learn a lot about myself when I compete against somebody. I measure myself by winning and losing. Every shot in basketball is clearly judged by an orange hoop — make or miss. The hoop makes it difficult to deceive yourself.”[49:56] The insight is if we do something really hard we won’t have any competition.[52:26] The athletes Larry knew were obsessed with the game they played. They were like his friend Steve Jobs who worried about the color of the screws inside a computer.[53:12] They reminded Larry of a line from Tombstone: Wyatt Earp asks Doc Holliday,“ What makes a man like Ringo, Doc? What makes him do the things he does?” Doc replies, “A man like Ringo has got a great big hole, right in the middle of him. He can never kill enough, or steal enough, or inflict enough pain to ever fill it.” For better and worse, Larry had the same hole, and he tried to fill it by winning. But as soon as he closed in on one of his goals, he immediately set another difficult and distant goal. In that way, he kept moving the finish line just out of reach.[54:31] Back home, standing by the lake where he and Steve had debated things great and small, Larry was certain that decades from now there would be two guys walking somewhere, talking about their icons. Steve would be mentioned. He would be one of those “misfits, rebels, troublemakers, the round pegs in square holes, the ones who see things differently,” words popularized in Apple’s “Think Different” ad campaign. Steve would be remembered as one of those with “no respect for the status quo.”[59:16] Those moments are my most cherished and enduring memories of my time with Steve. The four of us sitting together at Kona, eating papayas and laughing for no reason at all. I'll miss those times. Goodbye, Steve.[1:00:00] Larry’s nightmare: In Larry’s mind, it fed into a culture based on a homogenized egalitarian ethos where everyone was the same, where there are no winners and no losers, and where there are no more heroes.[1:02:21] Larry says something to Russell (the guy running his team). It echoes what Charles Kettering said last week: It is not what two people do the same that matters. It is what they do differently. Larry says, “You already have a job, Russell. You've got to figure out why we're so damn slow, our set another way. Why is New Zealand so fast? What are they doing that we're not?[1:03:08] Don’t give up before you absolutely have to. Stay in problem solving mode: Larry was not happy when he heard that speeches were being written and plans being made for the handover of the Cup, but he ignored it all until he was asked to settle an argument over who was going to give the concession speech during the handover. “Let me get this straight: people are fighting over who gets to give the concession speech? I don’t give a fuck who gives the concession speech. If we lose, everyone who wants to give a concession speech can give a concession speech. But we haven’t lost yet. Why don’t we focus on winning the next fucking race , rather than concession speeches.”Larry, a licensed commercial pilot with thousands of hours flying jets, likened their situation to a plane in distress. When pilots have a serious emergency, they immediately go into problem solving mode, and they stay in that mode until the problem is solved — or until just before impact. In that final moment, the aircraft’s cockpit voice recorder captures the pilot’s brief concession speech. There are two versions of the speech, one secular, one not: “Oh God ” and “ Oh shit.” Larry had not yet reached his “Oh God” or “Oh shit” moment. Down 8 points to 1, he remained in problem solving mode.[1:06:19] As Muhammad Ali once said, “It’s just a job. Grass grows, birds fly, waves pound the sand. I beat people up.” No one was going to live or die on the basis of these things. But contests were his best teachers. At some point, one person gets measured against another. They find out who wins and who doesn’t, and along the way they learn something about themselves. Larry had learned that he loved the striving, the facing of setbacks, and the trying again. [1:07:56] It’s hard for me to quit when I’m losing — and it’s hard for me to quit when I’m winning. It’s just hard for me to quit. I’m addicted to competing.—“I have listened to every episode released and look forward to every episode that comes out. The only criticism I would have is that after each podcast I usually want to buy the book because I am interested, so my poor wallet suffers.”— GarethBe like Gareth. Buy a book. It's good for you. It's good for Founders. A list of all the books featured on Founders Podcast.

What I learned from reading Professional Amateur: The Biography of Charles Franklin Kettering by Thomas Boyd----Get access to the World’s Most Valuable Notebook for Founders by investing in a subscription to Founders Notes----[3:06] If you had to summarize Charles Kettering this is the way you would do it: “As symbol of progress and the American way of life—as creator of ideas and builder of industries and employment—as inspirer of men to nobler thoughts and greater accomplishments—as foe of ignorance and discouragement—as friend of learning and optimistic resolve—Charles F. Kettering stands among the great men of all time.”[3:36] He was an American inventor, engineer, businessman, and the holder of 186 patents. He was a founder of Delco, and was head of research at General Motors from 1920 to 1947. Among his most widely used automotive developments were the electrical starting motor and leaded gasoline. He was also responsible for the invention of Freon refrigerant for refrigeration and air conditioning systems. He developed  the world's first aerial missile. He led the advancement of practical, lightweight two-stroke diesel engines, revolutionizing the locomotive and heavy equipment industries.[4:42] This is Ket talking about why it is so important to approach your work with the mindset that you are a professional amateur: We are simply professional amateurs. We are amateurs because we are doing things for the first time. We are professional because we know we are going to have a lot of trouble. The price of progress is trouble. And I don’t think the price is too high.[6:52] There is a quote from Thomas Edison that says “We don't know a millionth of one percent about anything.” Ket has that same belief. This is Ket echoing Thomas Edison: “In reality, we have only begun to knock a few chips from the great quarry of knowledge that has been given us to dig out and use. We are like the two fellows who started to walk from New York to San Francisco. When they got over into New Jersey, one said: “We must be pretty nearly there. We have been walking a long, long time.” That is just how we are in what we know technically. We have just barely begun.[9:57] I am enthusiastic about being an American because I came from the hills in Ohio. I was a hillbilly. [10:21] I thought the only thing involved in opportunity was whether I knew how to think with my head and how to do with my hands.[13:37] One lesson from his childhood that stuck with him his whole life is that you need to only worry about things you can control. One of the older men is teaching him this through a story: Besides learning about water power and flour mills, he got from the wise old miller some bits of philosophy which he stored in his young mind. “A lot of people are bound to worry,” the miller once told him. “If you can do something about it, you ought to worry. I would think there was something wrong with you if you didn’t. But if you can’t do anything, then worrying is just like running this mill when there is no grist to grind. All that does is to wear out the mill.”[14:49] He is not interested in rote memorization. He wants to understand the principles behind the thing. He wants to know the why.[18:12] The man from whom he learned most was Hiram Sweet, the wagon maker. But Sweet was more than a wagon maker. He was, as Kettering said long afterward, “an engineer of such keen ability as to be remarkable. You would no more think of running across such a man in a small town than you would of flying without a flying machine.” Hiram Sweet had invented and built a self-computing cash register which was in daily use at the drugstore. He had also made an astronomical clock. “Where did you find out all this?” Kettering asked Sweet. “I work in this wagon shop ten hours a day,” he replied, “from six-thirty in the morning until five-thirty in the afternoon; and when I have no wagon work to do I work on Sweet’s head.” Years afterward, when Kettering had become a noted man, he recalled the days spent in Sweet’s wagon shop, “Letting him work on my head . . . I learned more from that old wagon maker than I did in college. The world was so wonderful and he knew so little about it that he hated to sleep.”[20:22] Ket got what he said later was one of the important lessons he learned in college. He learned it from the eminent actor, Joseph Jefferson. Jefferson, together with his company, came to the university town to play his famous part of Rip Van Winkle.One of the men asked him how often he had played the part of Rip Van Winkle. The great actor told just how many hundreds of times he had played Rip. “Don’t you get terribly tired doing it so often?” he was asked. “Yes, I did get tired after a while. But the people wanted Rip. And so I went on playing him. I said to myself, ‘It doesn’t matter how you feel. Your job is to entertain the audience.’ Then I made up my mind that I would try to portray Rip Van Winkle just a little better each time. And that constant effort at improving the part has kept up my interest and enthusiasm.”[23:15] There is a time during Henry Ford’s third attempt at building an automobile manufacturing company. And he comes to see Charlie Sorensen.He's like, “You know what? We're about to run out of money. I guess I'm just not going be able to accomplish this goal.”There's this conversation that takes place between Henry and Charlie and at the end, Ford is fired back up. Ford was like “I felt like quitting at the beginning of the conversation. Now I don't.”A few short years later, he winds up attaining his life goal of building a car so inexpensively that the average person can have it. I think that’s important.There's so many times in Ford’s life story that he wants to quit, that he's disheartened.[26:44] The obstacle of not knowing how never kept him from undertaking anything he thought needed to be done. “It is a fundamental rule with me,” he said once, “that if I want to do something I start, whether I know how or not. . . . As a rule you can find that out by trying.”[28:04] Every great improvement has come after repeated failures. Virtually nothing comes out right the first time. Failures, repeated failures, are finger posts on the road to achievement.[36:18] Remembering the loyal support she (his wife) gave him during that trying period and afterward, Kettering said of her, “She was a great help in those early struggles, for she never got discouraged.” After she passes away from cancer he says she was the only thing in his life that he never tried to improve.[41:19] How Ket and his partner financed their company: To get even that small endeavor under way Kettering and Deeds had to put in all the money they could scrape up, and they mortgaged everything they had. Deeds put a mortgage on his house and Kettering on a lot that he owned. Both borrowed money on their life insurance policies. They also put up their patents and the contract with Cadillac as collateral for a loan from the bank. Cadillac paid them some money in advance. They sold some preferred stock, too, and raised money in every way possible.[42:09] All human development, no matter what form it takes, must be outside the rules; otherwise, we would never have anything new.[45:29] Kettering admired The Wright Brothers and all they did in overcoming obstacles to successful flight. Those obstacles were psychological as well as physical, for it was commonly believed then that heavier-than-air flight was impossible.  “The Wright Brothers,” Kettering said, “flew right through the smoke screen of impossibility.”[46:08] I have always had a rule for myself. Never fly when the birds don’t, because they have had a lot of experience.[49:22] The destruction of a theory is of no consequence for theories are only steppingstones. More great scientific developments have been made by stumbling than by what is thought of as science. In my opinion an ounce of experimentation is worth a pound of theory.[50:57] Ket hates committees: Mrs. Kettering read about Lindbergh’s solo flight across the Atlantic, she said to her husband, “How wonderful that he did it all alone!” “It would have been still more wonderful,” Kettering replied, “if he had done it with a committee.”[51:30] We find that in research a certain amount of intelligent ignorance is essential to progress; for, if you know too much, you won’t try the thing.[54:42] New ideas are the hardest things in the world to merchandise.[56:03] So great was his respect for independent thought and initiative in others that it was often difficult for those working on a project to find out just what he himself thought ought to be done in a given circumstance. He was careful not to stamp out a spark of fire in anyone. Instead, he would fan it to a bright glow. [57:31] He has been an inspiration to me and to the whole organization, particularly in directing our thoughts and our imagination and our activities toward doing a better job technically and the tremendous importance of technological progress.[1:00:07] You have to try things: Action without intelligence is a form of insanity, but intelligence without action is the greatest form of stupidity in the world.[1:00:19] In putting out new things troubles are not the exception. They are the rule. That is why I have said on so many occasions that the price of progress is trouble.[1:03:16] Let the competition think you are crazy. By the time they get it it will be too late: If you will help them keep on thinking that, we’ll not be bothered with competition during the years in which we are working out the bugs and developing a really good locomotive.[1:05:14] It is not what two groups do alike that matters. It’s what they do differently that is liable to count.[1:05:47] There are no places in an industrial situation where anyone can sit and rest. It is a question of change, change, change all the time. You can’t have profit without progress.[1:06:18] We don’t know enough to plan new industries: You can’t plan industries, because you can’t tell whether something is going to be an industry or not when you see it, and the chances are that it grows up right in front of you without ever being recognized as being an industry. Who planned the automobile industry? Nobody thought anything of it at all. It grew in spite of planning.[1:08:22] Because the field of human knowledge is so far from complete, he thinks our schools ought to teach that we know very little about anything.[1:09:04] The greatest thing that most fellows are lacking today is the fool trait of jumping into something and sticking at it until they come out all right.[1:09:54] He seems to have a complete absence of any timidity whatsoever. [1:10:54] I can conceive of nothing more foolish than to say the world is finished. We are not at the end of our progress but at the beginning. ----Get access to the World’s Most Valuable Notebook for Founders by investing in a subscription to Founders Notes----“I have listened to every episode released and look forward to every episode that comes out. The only criticism I would have is that after each podcast I usually want to buy the book because I am interested, so my poor wallet suffers.”— GarethBe like Gareth. Buy a book. It's good for you. It's good for Founders. A list of all the books featured on Founders Podcast.

What I learned from reading Softwar: An Intimate Portrait of Larry Ellison and Oracle by Matthew Symonds.----Get access to the World’s Most Valuable Notebook for Founders by investing in a subscription to Founders Notes----[0:01] Although much of my time with him coincided with a period of adversity for Oracle, I never once saw Ellison downcast. His unquenchable optimism and almost messianic self belief never faltered.[5:06] The single most important aspect of my personality is my questioning of conventional wisdom. My doubting of experts just because they are experts. My questioning of authority. While that can be very painful in terms of your relationships with your parents and teachers it is enormously useful in life. [12:19] People — teachers, coaches, bosses — want you to conform to some standard of behavior they deem correct. They measure and reward you on how well you conform — arrive on time, dress appropriately, exhibit a properly deferential attitude — as opposed to how well you do your job. Programming liberated me from all that.[16:34] I had always believed that at the top of these companies there must be some exceptionally capable people who make the entire technology industry work. Now here I was, working near the top of a tech company, and those capable people were nowhere to be found. The senior managers I saw were conformist, bureaucratic, and very reluctant to make decisions. [23:08] Oracle’s first product reflected Larry Ellison’s desire to do something no one else was doing: The opportunity was huge. We had a chance to build the world’s first commercial relational database. Why? Because nobody else was even trying. The other relational database projects were pure research efforts. If we could build a fast and reliable relational database, we would have it made. I thought that relational was clearly the way to go. It was very cool technology. And I liked the fact it was risky. The bigger the apparent risk, the fewer people will try to go there. We would surely lose if we had to face serious competition. But if we were all alone in pursuit of our goal of building the first commercial relational database system, we had a chance to win.[26:03] Larry is a sprinter. Not a grinder: Although he always talked about technology and Oracle with passion and intensity, he didn’t have the methodical relentlessness that made Bill Gates so formidable and feared. By his own admission, Ellison was not an obsessive grinder like Gates: “I am a sprinter. I rest, I sprint, I rest, I sprint again.” Ellison had a reputation for being easily bored by the process of running a business and often took time off, leaving the shop to senior colleagues.[30:55] If you speak out in support of small, unimportant innovations that fly in the face of widely held beliefs—I do it all the time—you are likely to be dismissed as stupid or arrogant, and that’s pretty much the end of it. However, if you defend a really big idea that challenges widely held beliefs, you’re likely to generate a mass of hatred, and you just might pay for it with your life. When Galileo defended Copernicus, he was ridiculed, imprisoned, and then threatened with death unless he recanted. Charles Darwin cautiously postponed publishing On the Origin of Species and The Descent of Man for more than twenty years, but that judicious delay did not save him from vicious personal attacks coming from all ranks of contemporary society.[37:09] Ellison on mistakes he made before the near death experience of Oracle: I was interested in the technology. I wasn’t interested in sales or accounting or legal. If I wasn’t interested in something, I simply ignored it. I just wasn’t paying proper attention to my job. I was doing only the things that interested me. It was the same problem I had in school. But this happened in my forties. I wasn’t a kid anymore.[38:40] Surviving Oracle’s near death experience made Larry Ellison stronger. It made him happier: After Oracle’s crisis, looking into the abyss and surviving, I felt emotionally strong enough to take a more realistic look at myself. I was tired of striving to be the person I thought I should be. If I was to have any chance at happiness, I had to understand and accept who I really was. [42:12] Larry Ellison’s core business philosophy: Larry Ellison says he’s happy only when everyone else thinks he’s wrong. The core of his business philosophy is that you can’t get rich by doing the same thing as everyone else. “In 1977, everyone said I was nuts when I said we were going to build the first commercial relational database. In 1995, everybody said I was nuts when I said that the PC was a ridiculous device — continuously increasing in complexity when it needs to become easier to use and less expensive.”[50:56] Larry’s great story about how duplication of effort costs Oracle a ton of money.[53:13] Never, ever, think about something else when you should be thinking about the power of incentives. —Charlie Munger: One of the worst ideas I can remember was when Ray decided we didn’t do enough selling through partners. The sales force convinced him that the way to fix this was to pay more money to the sales force if the deal went through a partner than if the deal came directly to Oracle. For example , if you sold a million - dollar deal directly, Oracle would get a million dollars and you would get a $ 100,000 commission. But if you sold a million - dollar deal through a partner, Oracle would get $ 600,000 and you would get a $ 120,000 commission. Needless to say, our sales force pushed as many deals as they could through partners that year, so the partners were happy. The sales force got higher commission payments for going through partners, so they were happy. The only loser was Oracle.[57:57] Ellison’s strategy: 1. Pick a fight. 2.Burn the boats: Once I’m finally certain of the right direction, I pick a fight, as I did with Gates. It helps me make my point, and it makes it impossible to do an about—face and go back. Once a course has been plotted, I sail a long way off and burn my boats. It’s win or die.[1:01:20] Larry Ellison on Bill Gates: Bill and I used to be friends, insofar as Bill has friends. Back in the eighties and early nineties , all the people in the PC software industry hated Bill because they feared Bill. But Oracle didn’t compete with Microsoft very much back then , so we got on pretty well. As I got to know Bill, I developed a great respect for the thoroughness of his thinking and his relentless, remorseless pursuit of industry domination. I found spending time with Bill intellectually interesting but emotionally exhausting; he has absolutely no sense of humor. I think he finds humor an utter waste of time — an unnecessary distraction from the business at hand. I don’t have anything like that kind of focus or single mindedness.[1:06:13] Larry Ellison on why Larry Ellison does what Larry Ellison does: My sister told me that whenever I got too close to a goal I’d raise the bar for fear of actually clearing it. We’re endlessly curious about our own limits. The process of self—discovery is one of testing and retesting yourself. I won the Sydney—to—Hobart. Can I win the America’s Cup? I’ll find out. The software business is a more difficult test; it’s a much higher stakes game; there are more people playing this game; it’s a lot more interesting game; and it’s a lot more exciting. If I wasn’t doing this, I’m not sure what else I would be doing with my life.----Get access to the World’s Most Valuable Notebook for Founders by investing in a subscription to Founders Notes----“I have listened to every episode released and look forward to every episode that comes out. The only criticism I would have is that after each podcast I usually want to buy the book because I am interested, so my poor wallet suffers.”— GarethBe like Gareth. Buy a book. It's good for you. It's good for Founders. A list of all the books featured on Founders Podcast.

Discover the incredible journey of Albert Champion from record-setting racer to dashing tycoon. Learn about his early struggles, fascination with unicycles, and rise to fame in professional bicycle racing. Explore his transition to the auto industry, the consequences of a life-altering accident, and his successful business ventures. Uncover his partnerships, tumultuous marriages, and determination to create durable spark plugs. This podcast is a captivating exploration of one man's extraordinary life and legacy.

What I learned from reading My Years with General Motors by Alfred Sloan.----Get access to the World’s Most Valuable Notebook for Founders by investing in a subscription to Founders Notes----[2:40] There are ideas worth billions in a $30 history book: Henry talked to me on several occasions about a book by the former chairman of General Motors. He told me he had learned a very important concept from that book, which he wished to use in the growth of Teledyne. . .during a very difficult economic time of recession, General Motors had needed additional funds to finance their growth and had a plan to sell bonds to the general public. The bond sale was a complete failure, and the chairman (Sloan) had written in his book that it had taught him an important lesson. It was that for a corporation to grow and to have a strong financial base, it needed to have, as part of itself, an interest in substantial financially oriented institutions. So General Motors had started GMAC and invested in other financial groups. As a result of his interest in this idea, Henry had decided that at some point, he would seek out financial organizations we could acquire. We began acquiring a number of financial and insurance companies, which was a significant change from our usual aerospace, metals, industrial and consumer company acquisitions.[5:45] Alfred Sloan had a singular focus: General Motors and the Hyatt Roller Bearing Company, have been almost the sole interests of my business life.[6:28] Alfred Sloan’s perspective on work: I simply took the view that we should go at the job vigorously and without hampering restrictions. I put no ceiling on progress.[12:22] Billy Durant came up with the idea for General Motors. Alfred Sloan perfected it: Durant’s pioneer work has yet to receive the recognition it deserves. His philosophy was an emerging one in the Model T era and was afterward to be realized not by him but by others, including myself.[19:08] The accumulated intelligence of mankind is what makes us special amongst all other species Everything is built upon the foundation before it: It has been called to my attention that Eli Whitney, long before, had started the development of interchangeable parts in connection with the manufacture of guns, a fact which suggests a line of descent from Whitney to Leland to the automobile industry.[29:20] Alfred Sloan had a great perspective on problems. They are temporary and we can fix them: Economic declines have a way of shaking out the weak ones in business, and we had weaknesses. Some people cannot see beyond a slump, but I have never yielded to economic pessimism and in times of decline have kept in mind the eventual upturn of the business cycle and the long—range dynamics of growth. Confidence and caution formed my attitude in 1920. We could not control the environment, or predict its changes precisely, but we could seek the flexibility to survive fluctuations in business. I mention this because confidence is an important element in business; it may on occasion make the difference between one man’s success and another’s failure.[33:15] Sloan on how difficult Henry Ford was to compete against: With Ford in almost complete possession of the low—price field, it would have been suicidal to compete with him head on. No conceivable amount of capital short of the United States Treasury could have sustained the losses required to take volume away from him at his own game. [38:40] Alfred Sloan on committees: I have often been taxed, by people who do not know me, with being a committee man—and in a sense I most certainly am—I have never believed that a group as such could manage anything. A group can make policy, but only individuals can administer policy.[44:20] General Motors was able to overtake Ford because they widened a niche: It was that plan, policy , or strategy of 1921—whatever it should be called— which, I believe, more than any other single factor enabled us to move into the rapidly changing market of the twenties with the confidence that we knew what we were doing commercially and were not merely chasing around in search of a lucky star. The most important particular object of that plan of campaign, which followed from its strategic principles, was, as I have said, to develop a larger place for Chevrolet between the Ford car below and the medium—price group above, a case of trying to widen a niche. That was all, in the beginning, despite the completeness of the plan with regard to the whole market.[56:40] Alfred Sloan knew the car market was changing. You didn’t make sales by having the best car. You made sales by being different. David Ogilvy called this idea “a positively good product”: In the past, just about every advertiser has assumed that in order to sell his goods he has to convince consumers that his product is superior to his competitor’s. This may not be necessary. It may be sufficient to convince consumers that your product is positively good. If the consumer feels certain that your product is good and feels uncertain about your competitor’s, he will buy yours. If you and your competitors all make excellent products, don’t try to imply that your product is better. Just say what’s good about your product – and do a clearer, more honest, more informative job of saying it. Sales will swing to the marketer who does the best job of creating confidence that his product is positively good.----Get access to the World’s Most Valuable Notebook for Founders by investing in a subscription to Founders Notes----“I have listened to every episode released and look forward to every episode that comes out. The only criticism I would have is that after each podcast I usually want to buy the book because I am interested, so my poor wallet suffers.”— GarethBe like Gareth. Buy a book. It's good for you. It's good for Founders. A list of all the books featured on Founders Podcast.

What I learned from reading Billy, Alfred, and General Motors: The Story of Two Unique Men, A Legendary Company, and a Remarkable Time in American History by William Pelfrey.----Get access to the World’s Most Valuable Notebook for Founders by investing in a subscription to Founders Notes----[0:01] They were oil and water in all respects. Billy Durant, the high school dropout, was the flamboyant dreamer and gambler, focused on personal relationships and risk. Alfred Sloan, the MIT engineer, was the stern organizer and manager, focused on data, logic, and profit.[4:40] The paradox of this book in two sentences: Sloan’s most constant criticism of Durant was that he acted on instinct and whim rather than facts. Yet the achievements and decisions of Durant the dreamer were what made Sloan the manager’s spectacular career possible.[6:50] Alfred Sloan telling us it is a lot harder to stay successful over a long period of time: “The perpetuation of an unusual success or the maintenance of an unusually high standard of leadership in any industry is sometimes more difficult than the attainment of that success or leadership in the first place.”[10:45] Walter Chrysler left the highest paying job in the entire automobile industry because of Billy Durant’s wasted his time: More than once, Chrysler had been summoned by Durant only to be kept waiting then to discover that the urgent matter that needed to be discussed was nothing that couldn’t have been resolved quickly at the plant level rather than wasting top management’s time and brainpower.[12:52] Sloan believed Billy Durant had no right to be distracted by the financial markets while Durant was supposed to be running General Motors: Sometimes I used to feel as if he were always holding a telephone in his hand. I think there were twenty telephones in his private office and a switchboard. He had private wires to brokers’ offices across the continent. In the same minute, he would buy in San Francisco, sell in Boston. It did not seem to me that the operating head of a corporation had any right to devote himself to the market, even if the stock of the corporation was involved. [17:13] Billy Durant will remind you that everything is possible: What was it in Billy’s genes and character that had led the high school dropout from rural Michigan to even dream of building an empire that would change the world?[20:30] Billy Durant would tell you to control the things that are important to your business: Billy Durant would never forget the bitter lesson of what he saw as Paterson’s treachery: Always control your own production and, whenever possible, all of the links in the supply chain.[23:05] Unlike Durant, Alfred Sloan had a singular focus. His singular focus was General Motors: By the early 1930s, Alfred Sloan was widely considered to be one of the richest men in the world, but he had no known hobbies and had never sold a single share of General Motors stock. His only known investment of either time or money in anything beyond the domain of General Motors was the purchase of a yacht at the urging of friends and his wife. [26:37] There are ideas worth billions in a $30 history book: In Henry Singleton’s case that is literally true. Reading Sloan’s book had a multiple billion dollar effect on the outcome of Teledyne.[29:04] Sloan would not tolerate any excuses: Sloan is kinda like Yoda. Do or do not. There is no try.[29:48] A key ideological difference between Alfred Sloan and Billy Durant was how growth should be financed: What Alfred didn’t mention in his letter was that Hyatt’s growth had come from reinvestment of the company’s own profits, rather than the acquisition and stock market strategy mastered by Billy Durant. A divergence of fundamental strategy that would be at the core of the General Motors crisis and showdown of 1920.[31:12] An important lesson from history is that new and important industries can start out looking like toys: In 1899 the automobile industry in America was no more than the strange and wild obsession of a few tinkerers and an amusing diversion for the wealthy investors who backed them. Cars were still widely considered impractical toys and dangerous nuisances by most people. [34:35] Alfred Sloan admired and copied Henry Leland, founder of Cadillac and Lincoln: Of all the American automobile industry’s unique and colorful characters, the one whom Alfred Sloan most admired and emulated was Henry Leland. Leland was a perfectionist who expected and demanded higher standards than any of his peers. He accepted no excuses and suffered no fools. Sloan devoted more words and detail to what he learned from Leland than he did any other person.[45:55] Alfred Sloan on why vertical integration was so important in the automobile industry: Every piece of the motor car is essential in the sense that the automobile is not complete unless every part is available. Delay in delivery of any part stops the work. A dependable supply of parts might well make the difference between success and failure.[48:08] Henry Ford's ONE idea was different from every other automobile manufacturer: He was determined to concentrate on the low end of the market, where he believed that high volume would drive costs down and at the same time feed even more demand for the product. It was a fundamental difference in philosophy.[49:35] Comparing and contrasting Billy Durant and Alfred Sloan’s approach to growth: For him, the thrill was always in the next deal, not in the nuts and bolts of daily operations. In his mind, empires were built by conquest, not through internal growth. And the road to conquest was through other people’s money and other people’s confidence in his genius, rather than the quiet, conservative road of knowing the fundamentals of manufacturing and marketing, as was followed by the likes of Henry Leland and Alfred P. Sloan.[56:05] Why Innovation is so important. We must arm the rebels! The automobile sparked not only the great oil boom it also sparked innovations in petroleum refining and metal alloys that led to further innovation in chemicals. It also spawned the motel industry as well as gasoline retailing. Thanks solely to the demand for gasoline to run the internal combustion engine automobile, crude oil production in the United States soared.The first gasoline pump appeared in 1905. By 1915, Standard Oil had developed the first chain of gasoline service stations. In 1916, the federal government began funding the interstate highway system. Ten years later, motels and road side restaurants were common in every state. Thanks to Henry Ford’s Model T, Billy Durant’s vision of a nation transformed by the automobile had become a reality.[57:47] When most of your revenue comes from one or two major customers you are fragile. Or Why Alfred Sloan sold Hyatt Roller Bearing to Billy Durant: The problem for Alfred and his peers was that, compared with the manufacturers, the suppliers’ pockets were not nearly as deep. Expanding their production capacity meant investment in new plant and equipment, but there was no guarantee that the boom would continue once these commitments were made. Nor was there any guarantee from the manufacturers that they would not shift to a different supplier with lower cost at some point in the future, leaving Supplier A stuck with both excess capacity and the cost of the original expansion.[1:14:23] How Alred Sloan positioned General Motors product line: Sloan developed a product strategy targeted at buyers’ specific aspirations. Its essence was to divide the market into price segments and offer cars with the most appeal and value in each segment. Sloan called it “a car for every purse and purpose.” No General Motors vehicle division or brand would compete against any other in any of the segments; each was to have a distinct identity and appeal to a distinct buyer.[1:15:10] David Ogilvy on positioning your product: Now consider how you want to ‘position’ your product. This curious verb is in great favor among marketing experts, but no two of them agree what it means. My own definition is ‘what the product does, and who it is for.’ I could have positioned Dove as a detergent bar for men with dirty hands, but chose instead to position it as a toilet bar for women with dry skin. This is still working 25 years later.[1:16:48] Alfred Sloan —like Sam Walton—made it a priority to visit dealers: I made it a practice throughout the 1920s and early thirties to make personal visits to dealers. I went into almost every city in the United States, visiting from five to ten dealers a day. I would meet them in their own places of business, talk with them across their own desks in their closing rooms and ask them for suggestions and criticism concerning their relations with the corporation, the character of the product, the corporation’s policies, the trend of consumer demand, their view of the future, and many other things of interest in the business. I made careful notes of all the points that came up, and when I got back home I studied them.[1:20:46] Billy Durant’s metaphor on the difference between him and Alfred Sloan: But, you see, this infantry captain didn’t have the disadvantage of a West Point education and he didn’t know he couldn’t do it, so he just went ahead and did it anyway.----Get access to the World’s Most Valuable Notebook for Founders by investing in a subscription to Founders Notes----“I have listened to every episode released and look forward to every episode that comes out. The only criticism I would have is that after each podcast I usually want to buy the book because I am interested, so my poor wallet suffers.”— GarethBe like Gareth. Buy a book. It's good for you. It's good for Founders. A list of all the books featured on Founders Podcast.

What I learned from reading Billy Durant Creator of General Motors: The Story of the Flamboyant Genius Who Helped Lead America into the Automobile Age by Lawrence Gustin.----Come see a live show with me and Patrick O'Shaughnessy from Invest Like The Best on October 19th in New York City. Get your tickets here! ----Subscribe to listen to Founders Premium — Subscribers can listen to Ask Me Anything (AMA) episodes and every bonus episode. ---[0:32] DURANT MAY BE THE MOST IMPORTANT AUTOMOBILE PIONEER: Of all the colorful men who propelled the United States into the automobile age, Billy Durant was perhaps the most unusual, and from an organizational standpoint in the pioneering era, the most important. Durant had a hand in shaping the beginnings of three of the four major American automobile manufacturing corporations that exist today.[4:16] HIS LIFE STORY HAS A SURPRISING END: The guy founded General Motors, Chrysler, and Frigidaire. Three gigantic, successful companies. How does he die with no money?[6:04] DURANT TRIED TO PROTECT HIS INVESTORS: He had an attitude, not a common among men of big money. He tried to protect the people who invested with him, even if this protection would break him. Finally, it did. And when he was unable to save the dollars of his supporters he plunged from multimillionaire to bankruptcy.[10:29] DURANT WAS SKEPTICAL OF AUTOMOBILES: Durant starts out as an automobile skeptic. He builds the General Motors of horse-drawn transportation and then takes that same playbook and uses it again to do the same thing in the automobile industry once he gets over his skepticism.[17:08] IF SOMETHING IS IMPORTANT TO YOUR BUSINESS YOU NEED TO CONTROL IT: We have seen this over and over and over and over again in these stories throughout the history of entrepreneurship. If something is important to your business, you need to control it. Durant line up a big contract for the buggies only to find that Patterson chanced upon the same buyer and told him that since the product was actually being made at his factory, the buyer could save money by buying directly from him. Durant that from then on they would build all their own vehicles.[19:12] DURANT ON SALES: Assume that the person you are talking to knows as much or more than you do. Do not talk too much. Give the customer time to think. In other words, let the customer sell himself. That system works best when you have a good product. Look for a self - seller. If you cannot find one, make one.[21:48] ON CONTROL. HENRY FORD REALIZED THIS. THE DODGE BROTHERS DID TOO: We started out as assemblers with no advantage over our competitors. We paid about the same prices for everything we purchased. We realized that we were making no progress and would not unless and until we manufactured practically every important part that we used. We proceeded to purchase plants and the control of plants, which made it possible for us to build up the largest carriage company in the United States.[31:36] DURANT WAS AT THE RIGHT PLACE, AT THE RIGHT TIME, WITH THE RIGHT SET OF SKILLS: For the first time, he began to see that the automobile had a future. The stockholders of Buick were so desperate that they were willing to turn over controlling interest to him. And perhaps most important, the Durant-Dort Carriage Company had a large, idle factory. [39:11] IT WAS HARD TO RAISE MONEY FOR GENERAL MOTORS: I had a long, hot session with our friends in New York yesterday and was pretty nearly used up at the finish. If you think it is an easy matter to get money from New York capitalists to finance a motor car proposition in Michigan, you have another guess coming. Money is hard to get owing to a somewhat unaccountable feeling of uneasiness and a general distrust of the automobile proposition.[44:25] BILLY DURANT’S MASTER PLAN FOR GENERAL MOTORS: Durant's aim was nothing less than to gain control of some of the biggest and best automobile companies in America. But he also wanted to get in on the ground floor with companies just starting. Durant: “They could be purchased by exchanging small amounts of stock, and who could tell what their patents, products, and inventions might bring? The automobile industry was in its infancy, the public was fickle, the only sure road to power and success was to have a wide range of products. I figured if I could acquire a few more companies like the Buick, I would have control of the greatest industry in this country. A great opportunity, no time to lose, I must get busy.”[51:30] DON VALENTINE TEACHES YOU BUSINESS IN TWO MINUTES: There are two things in business that matter, and you can learn this in two minutes --you don't have to go to business school for two years: high gross margins and cash flow. All companies that go out of business do so for the same reason- they run out of money." —Don Valentine[55:10] GENERAL MOTORS RUNS OUT OF MONEY! DURANT IS FORCED OUT: The bankers demanded control of the company. Durant had no choice but to accept. Automotive historians have generally described the terms as exorbitant. And Durant, in his memoirs, fumed: “The $ 15 million loan finally offered had outrageous terms which I was forced to accept. Under the terms, I received $ 12,250,000 cash ( not $ 15 million ), for which I gave $ 21,600,000 of the best securities ever created — the enormous interest of $ 9,350,000.[57:57] DURANT’S STRATEGY FOR CHEVROLET WAS TO FOCUS ON THE LOW PRICED MARKET BECAUSE IT HAD MORE DEMAND THAN SUPPLY : Henry Ford couldn't build enough cars to satisfy the entire demand for a low priced automobile.[1:04:50] THE UNUSUAL HAPPENS, USUALLY. BILLY DURANT IS THE OPPOSITE OF HETTY GREEN OR MARK SPITZNAGEL: In 1920 the boom that had followed the end of WWI came to a rather abrupt halt and the United States slumped into a sharp recession. The price of GM stock began to decline steadily. GM sold 47,000 cars a month. By November monthly sales were down to 12,000. Durant realized GM needed money.[1:10:26] BILLY DURANT’S LIFE SHOULD HAVE HAD A HAPPIER ENDING: All that can be said for certain about Durant’s last days at GM is that his activities in the stock market placed him in an extremely vulnerable situation. Louis Kaufman said in 1927 that had Durant not become involved in the market he would have been worth $500 million and still in charge of GM. ----“I have listened to every episode released and look forward to every episode that comes out. The only criticism I would have is that after each podcast I usually want to buy the book because I am interested so my poor wallet suffers. ” — GarethBe like Gareth. Buy a book: All the books featured on Founders Podcast

What I learned from reading The Dodge Brothers: The Men, the Motor Cars, and the Legacy by Charles Hyde.----Get access to the World’s Most Valuable Notebook for Founders by investing in a subscription to Founders Notes----This is the story of two small town machinists who became enormously successful automobile manufacturers in the early years of the auto industry [0:01]Early life and first jobs [3:02]Moving to Detroit: Arriving at the right place, at the right time, with the right skill set [6:28]Horace Dodge is a gifted engineer like Henry Royce (Founders #81) was + Inventors and bicycle manufacturers [12:00]How The Dodge Brothers first described their business [16:40]Doing work for Ransom Olds, Founder of Oldsmobile [18:20]Crucial decisions in the early days of the company [23:33]In a gold rush don't dig for gold. Sell pick axes [24:44]The Dodge Brothers almost bankrupted Ford for lack of payment [28:22]The Dodge Brothers got very rich off of Henry Ford [33:28]Why and how the Dodge Brothers built their own car [36:00]Comparing The Dodge Brothers organizational structure with that of Ford and GM [41:00]The Dodge Brothers view on advertising [43:04]How and why they worked so well together [46:13]A bond so tight it could only be separated by death [50:58]Their greatest accomplishment [52:01]----Get access to the World’s Most Valuable Notebook for Founders by investing in a subscription to Founders Notes----“I have listened to every episode released and look forward to every episode that comes out. The only criticism I would have is that after each podcast I usually want to buy the book because I am interested, so my poor wallet suffers.”— GarethBe like Gareth. Buy a book. It's good for you. It's good for Founders. A list of all the books featured on Founders Podcast.

What I learned by reading My Forty Years With Ford by Charles Sorensen.----Come see a live show with me and Patrick O'Shaughnessy from Invest Like The Best on October 19th in New York City. Get your tickets here! ----Subscribe to listen to Founders Premium — Subscribers can listen to Ask Me Anything (AMA) episodes and every bonus episode. ---Henry Ford’s greatest achievement and his greatest failure [0:01]Henry Ford had one, single idea [4:15]Henry Ford’s management style [5:46]The paradox of Henry Ford [8:27]Henry Ford’s greatest advisor [11:30]A great story about The Dodge Brothers [16:20]Why and how Henry Ford bought out all of the shareholders of Ford [19:15]Henry Ford would tell you to not divert your attention [27:15]Henry Ford would tell you to not be afraid [28:20]Henry Ford would tell you to be firm in what you want to accomplish but flexible in how you do it [31:45]Why Henry Ford and The Ford Motor Company are worthy of study [36:20]The difference between a pioneer and an expert [39:45]Henry Ford would tell you not to worry about titles [47:40]Henry Ford would tell you to focus on individual contact over collective speeches [49:52]Henry Ford would tell you don't let your team grow stale [50:10]Henry Ford would tell you that you can’t foresee everything. Even things that should be obvious. [50:50]Henry Ford would tell you to never stop learning [51:32]A description of Detroit and the early days of one of the most important industries ever created [55:14]The story of the Model T: Henry ford was groping and fumbling toward a low-cost car. [59:14]---“I have listened to every episode released and look forward to every episode that comes out. The only criticism I would have is that after each podcast I usually want to buy the book because I am interested, so my poor wallet suffers.”— GarethBe like Gareth. Buy a book. It's good for you. It's good for Founders. A list of all the books featured on Founders Podcast.

Explore the inspiring life story of Chung Ju-yung, founder of Hyundai. From running away from home to building a business empire, his determination and hard work shine. Learn about his management style, overseas expansion, and the rise of Hyundai Motors. Find out why determination trumps intelligence and why frugality is key to success.