For all my friends, this is their only business. This is literally their lifeline. And so I find it very not cool is my official diagnosis. Super uncool by the Orange Gang.
All right, Sean, Mahalo. My first question is what's it feel like to be an extra on the set of white lotus? As long as I'm not the guy who dies, I'm good. All right.
So that's my white lotus game plan. I thought I'd be festive for you. I think you look good. Dude, I was, as you know, I don't leave my house and took the family vacation.
So we're in Hawaii and I texted Ben. I go, dude, I recognize left and right. And he goes, really? That's awesome.
Like, how many times is it? 10, 11? And I go, no, dude, two left and right. I had to have a class just now.
And it takes you right away. This is amazing. Where did you get recognized at the airport? Dude, someone voice recognized me.
I was like coming around the corner somewhere. I'm talking to my kids. And somebody just runs around the corner and goes, Hey, are you sure? Are you sure?
Did you just recognize that voice? Yeah. Listen to the podcast a bunch. There's been so many times where I've met someone and I like, we should hang out.
Whether they text me. Like on this flight? Yeah. Do you want to take it?
Well, if I'm like flying home and like someone's sitting near me, I'm like, do you want to be friends and like get together? Sometimes they'll mess it to me a week later. I'm like, what was I doing? It's like going to the grocery store hungry.
Like I'm just like, maybe bad choices. Can we talk about tariffs really quick? First of all, I want to let people know. I don't know anything about this.
Like I'm not like an economist, which everyone is all of a sudden. But I want to know, did you go to Hawaii because you were sweating and you're like, I need to find peace or what? Dude, the last time I came to Hawaii, I don't remember this was in 2020. Wasn't it like a some crypto thing?
Like you. Yeah, I landed and the same day I landed crypto had the biggest crash, like Luna basically went broke and it brought down Bitcoin with it. And I basically landed and it lost a million dollars and it was just trying to hang out with my wife. And just be like, okay, cool.
I'm just not going to mention this. Like how expensive this vacation has got. And the worst part was because I was on vacation, I didn't have like any of my normal, like computer hardware right here. I can sell.
Yeah. Yeah. Like, oh, this cold stores were going to be great. So I was basically stuck.
And then to this time, same thing. When I think you should, oh, the S&P 500 is at the worst, like three day losses since like the bubonic plague. And I was like, oh, great. Here we go again.
I'm not going to Hawaii anymore. When I've been going through this, as everyone knows, I'm heavy on index. And when I have been going through this, my I've just, I just don't look. I just don't look.
I just I pretend it doesn't exist. And I don't look. Although I did, I invested a little bit more than normally do every month and I went a little bit heavier, but I just didn't look. I just can't log in.
It makes me too anxious and not really ruins my day. Yeah. Well, I asked some question. Am I going to do anything?
Is my plan? Do I have some trade I'm trying to make right now? Is there some subgenius movement, which is trying to panic cell? No.
OK, if not, then there's really no point in looking. It's just going to read my vacation. So I don't look. But when I landed, there was something I had to look at, which is these tariffs.
So not only the stock market, or maybe because of this, the stock market has been crashing, which is that Donald Trump has created a new holiday, Sam liberation day. Yeah. It's only lives. Somebody was like, maybe he met liberation day in the sense of liberation, like the Buddhist think where we are being liberated in all of our possessions and we don't have any anything anymore.
I don't have any material goods anymore. Thank you. So he came out and he has this giant poster board slam to every country that's basically like a slam board where he's like, China, you're getting terror. Everybody's getting terror.
And and then since then, so he came out with like a 50 percent or whatever. It was like a 35 percent plus 20 percent tariff on China. So it's like, wow, 54 percent. That's going to be crazy.
And then since then he added another 50 percent on top. So now we're at 104 and I suppose there's just no upper limit as to how hard I this could go because this morning, as of this morning, China retaliated with its own escalating retaliation, 80 something percent tariff. So we're in a trade war. And does that mean for you as an e-comm owner, when you buy $10,000 worth of goods from China, if you do buy them from China, that now you're going to pay $20,000?
Yes. Okay. So that's simple as that. Got it.
So simple as that. So basically, and the reason to talk about this is not because I'm a a spare factory, but because I have an e-comm source and I have a lot of friends and e-commerce as well. And for all of them, this is like DBA basically. So most of us manufacturing China, not because we're like, Oh, I really want to have the lowest cost goods from China.
That wasn't really the impetus. In fact, when I started our company, we first looked at manufacturing in the US, we were like, Oh, that'd be great. They'd be great to be in fact in the US. They'd be great storage to tell customers.
Also, maybe we'll be faster lead times because we're not having to put every item on a boat and sail it across the sea. So I called all the manufacturers like fine in the US and I was like, Hey, like, do you think you could do this? And most of them were just like, no. And one guy in LA was like, Oh, yeah, we could do this.
Do you want it for double the price? Half the speed and half is good. Say yourself. He's like, I'm just being honest with you.
He's like, if you're comparing factories, you're going to find this. He's like, I was like, how could it be half the speed? There's no boat. There's no sitting on a boat for a month.
It would explain to you. It was like number one, all of the inputs to anything you're going to make. So even if we make it, we're going to import all the parts. So we still have the parts on a boat for a long period.
And secondly, we don't have the labor that's skilled at doing this. Third, we don't have the machines. He was like, actually, it's the machine. It's not the labor.
That's the problem. He's like, basically, when we kind of deindustrialized all of the best machinery to do this work, went to China. There's only like so many machines that do this right now to get a new machine. It takes like a year and a lot of time to cost much money as we have the machines.
And I was like, OK, so I was just going to answer the phone. Like, I don't want your business. How are you? Is there anything I can add to the phone?
Yeah. Like, all right, have a good day. Bye bye, Doug. Go have yourself.
Like, that's how they answer the phone. Oh, it's great. He's like a retired guy. He's like, my dad would like to do that in retirement.
And so one of your friends taking in the industry, because it seems to you guys just get beat up constantly. You know what I mean? You just get punched all the time. Yes.
Okay, make it up here. Great. Again, which is the great part of what's happening where all we're doing is putting like all these small businesses out of business. And raising the price of consumers.
Right. So here's what's happening. So just to give you a scenario, I have a friend who is doing really well with this business and the business has been growing. And so prior to taking office, he's growing the business.
Trump takes office. He says he's going to have a tariff. He says he's going to be a 20% tariff. So we're like, OK, mentally prepared for 20% tariff.
So he places an order now, just give me a sense like orders to have like a, forgive moving your manufacturer, which is a multi year process that may not even work. Just like changing your like sourcing from one place to another is, you know, six months to a year to get it up to scale. This guy, you know, he's operating a four monthly time, meaning from the day he knows he needs an order. He has to place it four months.
And he placed it four months ago, four months ago, it was basically before Trump even took office. Right. So he placed that order. And now as that order is, he's got five containers out at sea about like on the ship and they're like, yeah, it's a hundred percent tariff.
Now, so he has to pay a million dollars in tariff. He doesn't have a million dollars. So he's like, look, he's like, dude, I literally don't know what I'm going to do. Like, I don't have a million extra dollars lying around my business that I can just pay this tariff.
I also have five containers, I have thousands of units just sitting there. They can't be rerouted. I can't tell them to go back to China. I can't.
I can't. He's like, what are you going to shut down like this? It's like, he's basically like totally screwed. And so this is common.
There's a lot of people are dealing with this. You and I have a mutual friend. He said the same thing. He was like, he's like my container, you know, the price for a container got screwed during a bunch of stuff in the last two or three years.
There were so many different things. There was the Panama Canal or what? Sue has come out, I forget whatever there was the ship got stuck. Yeah, ship got stuck.
Then there's this and there's that. And now he's like, this thing, he's like, I don't have enough money to buy the goods that I have coming in because I placed the order like a month ago, like all like it was like in transit, it changed the price. Totally. In fact, I'm going to stop calling it tariffs with my kids.
I'm just going to use that lingo. Maybe it'll be fun to be on the other side of the tariff. And there's a little bit of a certain people trying to find whether it's work arounds or, you know, try to figure out, hey, does this apply? Because it's kind of unclear even how this applies.
You know, it doesn't matter if I got the goods on the boat beforehand, either way, whether this shipment gets tariffed a million dollars or not. Point is, it's very hard to survive as a business. When you operate it, let's say, an e-commerce business that has 10 to 15% profit margin. If you're doing things right, you know, 20, if you're really kicking ass and you've been business and business for a long time, you have economies of scale and you have a larger trade customer base, but like 10 to 15% profit margins.
And then your cogs go up by 100% is not going to work. Like they're going to go broke. And so the alternative is you have to pass that to the customer. So now you have to tell the customer, hey, what this means to the customer, the math is if a normal, let's say a unit, everything costs a dollar and now it's going to cost $2.
Well, before you sold that $1 thing for, let's say $3 or $4, let's say $4 market, right? So your college was $25. So for us, I would imagine, it's very normal. Yeah.
A standard market, let's say. And that sounds like greedy. Oh, you're already marking it up for us. Well, no, because you have to pay for marketing and advertising and your staff and fulfillment and all this other stuff.
You end up with a 10% to 10% profit margin by the end of it, which is like restaurant territory. And so, you know, it's not some fat cats over here in the e-commerce. You're going to be able to tiered scraggly fools who are just playing the wrong game. And so you take that dollar item now, it's $2.
Well, that means you have to raise the price instead of being four, which is now you got to raise it to five to make up for that. Right? So you're all your goods are going to go up by 25 to 30%. So that's inflationary, right?
So you thought inflation was bad forward, and all this stuff. Well, wait till Christmas season comes and nobody could buy a toy because all the toys are made in China. Right? This is things all the shirts made in China, all the toys are made in China.
It's not made in China. They're made in Vietnam, which also get tear-off. And so it's like, you know, there's a few countries that make all the stuff. And this plan really doesn't make a lot of sense to me.
Now, maybe I'm just being sensitive because I have business. It's very fine. Yeah. Yeah.
So, well, less so for me, because I have a lot of businesses, but for all of my friends, this is their only business. It's literally their lifeline. And so I find it very not cool is my official diagnosis. Super cool by the orange guy.
I think you need to create like a Sean's homey private chat lobby. And you guys get spent literally thousands of dollars to lobby the government to change their opinion. I'm going to go to the lobby of this hotel to see if I can get someone to change their mind. That's not what I'm doing.
I'm doing it. You'll declare bankruptcy down there by yelling it and declaring it. So, by the way, I don't know if you've read Molson who I don't know if you know Molson. Hark, he wrote a great post on X.
I think it's worth reading. And it's basically called America underestimates the difficulty of bringing manufacturing back. And he gives 14 reasons about like why even if he took the generous side of this like policy and you're like, Oh, you know what? Short term pain for long term gain, right?
Because I think we all agree. They're short term pain, right? The business owners have short term pain. The consumers are going to have the price of a short term pain.
The factories on the other side have short term pain. The stock market is crashing. That's short term pain. The 401ks are going down.
So that was pretty unexpected. The question is, is there even long term gain? And he wrote a post that basically outlines like, you know, very thoughtfully why there's some problems with this. And he's basically like, you know, one argument after another.
It's sort of like not only does moving a manufacturing plant back to America take a long time, like by the time somebody by the time a business owner who today is going to hit by these tariffs, assuming they could somehow survive, spend millions of extra dollars opening up manufacturing in the United States, which is not going to happen. And it's a multi year period before they get it all online. And then they magically find the labor to do this because we don't really even train people in America to do this type of work anymore. There's going to be a new president and you don't even know what this territory is going to be.
But there might be a totally a total fool's errand to do about it. So nobody's really going to be able to make that move. Most likely what's actually going to happen is like, you know, we tried to do this in Treps first term and all we did was make Vietnam great again. Like basically, the shimmy factor just shifts to one of the other low cost Asian countries that has lower tariffs is what's going to actually happen.
They're just not going to like magically bring jobs back. Oh, and by the way, you don't want to sit there and net t-shirts either. Like, this is not a job you want. The job's China doesn't even want it.
You want it? Dave Chappelle was like, I want to wear Jordans. I don't want to make them. It's exactly perfectly said.
Like this is memes going around of like, you know, it'll be like, like, chama, like, like, like a sewing machine. It's like, is this what you think is going to happen? Is this America being great again? I'm not sure.
And so, you know, political stuff aside, I think that the, the tariff situation is really crazy right now. And as a business owner, it is very, very tricky how to navigate this amongst your friend group. Is it going to put anyone out of business or is it just going to destroy their margins? Like, is this like a complete huge risk or is it like you've just made my life more challenging?
It's kind of for sure puts a lot of business because you had to, like I said, my friend with the stuff already at sea or just trying to scale their business, they might not be able to sell their product for an extra, let's say, their $100 product before and now their $140 product in order to maintain, you know, still some profit. So on one hand, demand is going to go down. Right. I'm going to have less customers because I had to raise my price.
My costs went up. My cash flow that I had in the business went down and maybe down to a point where I'm needing to borrow money in order to just pay the tariff bills that I have of stuff. I've already had flight. It's a very, very tricky situation.
You know, what we did in our business was I was like, okay, here's how you do situations like this. You had to create like immediate SWAT team and let's open up and Google Doc, let's make six bullet points, like what are the six levers we could pull? Okay. So pricing, we're going to have to create some sort of tariff surcharge.
And we think it could be in this range that'll offset some, but not all of the amount because we can't pass on the customer. It'll kill demand. And so we're going to pass, you know, a few bucks to the customer this way. The next thing we can do, we're trying to source from another country.
Okay. It looks like, you know, maybe it's Mexico or it's India or it's what it's lower care of countries. Okay. You're working on that.
You over here, you're going to work on, you know, figuring out how we're going to lower our costs. You have to go to go to go straight with the factory, ask them to share some of the burden with you. You're going to have to look up the talk to lawyers and see what's going on with the stuff that's already in flight. Hey, we're going to have to bring down the purchase orders because we have to be way more conservative.
Hey, you're going to have to go secure more debt because we're going to need a line of credit to make sure we can withstand the storm here. And so we created this plan. I was like, we're meeting every day, these five people, like the five core people that got, whatever other priorities you had, they're gone. This is your priority now.
We're going to meet every day and we're going to work on this plan for the next, you know, end number of days until this plan is executed. And I think it's going to take that level of intensity. I think a mistake I made in the past is when things like this happen and you sort of take a little bit of a wait and see approach. I think that could be very every day that you don't act to be very costly as a business owner.
And so I think one of the key things to do, like our business, we have a CEO, we have a full exact team. But when I heard how they were planning to approach this, it was like, yeah, this is like really important. Just like these other four really important things. I go, no, no, no, no, no, you need to like have a public, you know, PSA.
This is the most important thing you could do. We're going to be every morning. There was a name for this team. And this is the most important thing we're doing.
And this is your top or you need to cut off some of the shit, right? Like I think just raising a level of intensity is very key in a situation like this. More people will go out of business. So you're going to go snorkel.
Yeah. As somebody, I'm on the call and talking about how we have to like raise the intensity. And there's literally just like, oh, how is this like calming like Hawaiian music behind me and like clearly like palm trees? And I'm like, guys, guys, this is life or death.
And I like, I'm going down a water slide on the Google B. I didn't plan it to swear. You stop like mid talk to like get your drink that has the umbrella and you're like, looking for the straw with your mouth. That's awesome.
Well, that sucks. Is there a world where is there any time? You know, like what? What is it?
What is it? It's like a is there anything I can do? No, no, dude, dude, I met with a guy the other day and I thought I was like, why do what I never take phone calls with people? But he wanted to talk and I thought he was going to end the conversation with like, like, look, you know, I've loved watching you get big and be on the pod.
And you know, is there anything I can do? And I thought he was like, could do to help. And he said, is there anything I could do to be a guest on the podcast? I was like, what?
I thought you were going to ask me how you could help me. You just ended up with, is there anything I could do to be on your podcast and to have you promote me? I was like, no, there's nothing that you can do. Wow.
Hell of an asker. Yeah, who's a bold ask? Do you want to talk about something more fun? Please.
All right. Let's talk about something more fun. I think this is actually going to be really fun. I'm going to try and take your mind away from the fact that the company that you've spent decades trying to build with, I'm going to try to take your mind off of that.
It just, you know, four decades you spent building this company, not in the vanish. Never said Sam to like the cancer award. We don't have time. We don't have a lot of time left.
So let's get to it. Sorry. You don't have a lot of time left. So let's sorry.
I think it's good. All right. But I did. I read something interesting that I when I read it, I was shocked by it.
And the reason I read this thing was because my company happened. It's basically like an events company. We always 100 cents a year. And so I'm trying to learn how other like event-based businesses operate.
And I found one that I totally didn't realize how amazing it was. And I just forgot about it. Have you ever heard of the medieval times? Generally?
Yeah, sure. No, the restaurant series, like the restaurant franchise. No, you've never. Oh my God.
You're going to love this. OK, Google is like great forest cafe, but for like more. Oh, there's like basically it looks like a small castle, like the Excalibur hotel in Vegas. And then inside there's like people on horses jousting.
I always thought this was just like a joke. I thought this was a joke in like 90s movies. Like for where people were going for dinner. I didn't realize it was a real thing.
So let me tell you the story. So medieval times, it's basically dinner theater. And so they do a two hour show where you go with you, your wife, and your two kids and you spend something like $80 ahead. And you see people host a medieval show.
There's like 200 actors and they do jousting. They do like some type of theater stuff. It's almost like Cirque du Soleil, but it's medieval stuff. And it's like it's like WWF or something like wrestling.
Like it's all like acting. I did not realize how big this was. So let me tell you the story. So the guy who started it, his name was Jose.
He was a Spanish guy. He had a small restaurant in Spain where he would like have like medieval like circus performers, like doing juggling and just really small stuff and inside of a barbecue joint in Spain in the 80s for some reason, he decides to move to America. And he's like, I want to create what I did in Spain, which was a really small thing. I'm going to do it in America.
And he convinces a couple bankers to invest $8 million into his first restaurant. And that first restaurant was in Florida and he creates what is now medieval's times and he creates this thing where the idea is we're going to host something like 20 to 40 shows per month. I'm going to hire 200 actors. He spent a year training these guys how to sort by how to joust, how to like be like legit actors.
And he's like, we're going to serve you turkey legs and other medieval food, like whatever like the stereotype, like stereotypical medieval food is. And we're going to create this dinner experience. And that's what he launches in 1983. Well, fast forward almost 40 years now or 40 plus years.
His son has taken it over and they were recently sued because a bunch of their performers tried to unionize and apparently they were preventing them from unionizing. And so there was a ton of articles written about this company and a lot of people were talking about their financials. They're enormous. So this company does so basically they have it's estimated around two to 2.5 million people a year coming to the restaurants and they make something like $150 to $200 million a year in 10 locations hosting these dinner theater shows.
It's amazing. I had no idea this was this big. And since 1983, they've hosted close to 80 million people at these events. Have you ever been to one of these?
No. So there's 10 locations and I haven't lived in any of the places Dallas, Myrtle Beach, Scottsdale, like places that I haven't really lived in. So I've never been to one. Have you?
No, I've never been to one. Say the numbers again. So how big is this a tech just on 10 locations on 10 locations during the union lawsuit and things like that. Reporters were doing back at the envelope math and they were like, we think the company does between $150 and $200 million a year in revenue.
And there's 10 locations and each location post something like it, depending on the how popular it is, but the lowest one does something like 20, 20 performances a month. All the way up to 60 performances a month. So two a day for 30 days. It's insane how much demand there is.
And it was estimated that it was around two million people a year attending. And on their official website, they say something like 80, I think they say 76 million people have ever attended a medieval times restaurant for one of their performances. Is that same? So you have $10 million per location and they might be making $1 to $2 million a profit per location, something like that.
So that's my guess or more. So the way it works is it's not a normal restaurant. And so you don't order the food. It's all pre selected.
And so it's like a assembly line at the same time. All 1000 guests get the exact same food. So like there's a lot of like maybe potentially significantly more efficiencies than a normal restaurant because there's not like, you know, a whole menu of stuff to do and get this. Their performances, they only change the performances every five to seven years.
So they spend a lot of time like making the performance and then everyone else just goes and learns it and they perfect it over the course of five years. They don't even change it that often. And it takes like 200 performers for every show. Yeah, it's pretty rough for, you know, night performers, right?
Cause you have like the step down between game of furloughs and the medieval times restaurant that it's so bad. Like the second place is pretty rough. And I kind of do what I've got to do. So this is hilarious is you were like, you were like looking this up as an analog for Hampton.
Are you thinking about getting in the turkey leg business? What's wrong? Well, the way that we are going to grow is through launching cities. And I'm like, you know, trying to study like how launches work, how do you have like general managers of each city or each region?
Do you? I'm just trying to understand like the logistics of it. And I'm looking at a variety of unrelated, but still in the event space just to figure out how do they do it? How do people do it?
And so I'm just looking at a ton of different ways. And I was just curious about for some reason I came across these guys and I started thinking about like, oh, they are 10 locations. Are they franchises? How do they work?
And it just caught my eye and I was shocked at how big they were. Can I tell you a goofy story that's kind of similar to what you just described? So I've been writing this book like on the side. I'm not sure if I'm actually going to call this or not, like, but I kind of got way down a rabbit hole.
I'm interested in it. And it was it was around how creativity works. So how people how to be more how to be a more creative person and ultimately like make hits. So where do the hits come from?
What's the title? Bad art. Bad art. OK.
Yeah. So it's like because there's one of the key like obvious sounds obvious and high type. But like when you go look at the creative process of the world's most successful creative people, you would think a lot of the ones who make the hits the things that we all love, the high quality stuff, they just nail quality. And if you listen to any of their interviews, you watch the process, they don't give two shits about quality directly.
What they do is they focus on quantity and their belief is based on the quantity is the only way to get to all of these. They play a volume game and we produce a lot of bad art. And that's where the one or two things that are real gold come from. If you just sit down and try to make gold, it doesn't work.
You actually end up not creating it all. And so one of the things I've been looking at is like how some of the big breakthroughs came from doing what you're talking about, which is like you learn from an adjacent space. So you go and you know, the right brothers who ended up creating the first airplane. George, I read there.
They're book and they're amazing, but George Max summarized their book amazingly in his high agency blog post. Yeah, yeah, exactly. So they, you know, they were they were not funded. They had no education.
They had no team. They had no specialty that experience doing this. No, nothing. And like meanwhile, there's a guy over there funded by the Smithsonian, had two million dollars in funding, had tons of engineers and scientists on his team, had all the press and the fanfare.
It was clear that he was going to be the one he was the favorite. So how did the underdog win? Why did the underdog have to create a breakthrough? And like one of the reasons why is the two brothers, the right brothers, they owned a bike shop.
And so they, they, because they had no money, they did like 200 prototypes in the time that the other guy did two. And their 200 prototypes were basically like, they weren't even, they didn't even look like planes. They were just testing like individual parts of a plane, like they'd make a glider or a wing. And then they would make the wheels and they would try to find different ways to test these things out.
And even Kitty Hawk, even the selection of where to go, they were like, thought from first principles, like where should we launch this thing? Like, oh, maybe we should launch from this spot or the best way on that, et cetera. Right. So they weren't like tied to anything that was like, there was, they were not tied to anything.
Everything was first principles thinking. Similarly, I don't know if you've heard the story about the Yankees bats. Have you seen this? You'll have to enlighten me, but basically the bats are heavier in the area where the ball mostly hits.
Is that right? Yeah, like the story, I mean, take the physics of it aside. Like the story is just kind of interesting because here, yeah, baseball, this game that's been around for like, I don't know, 100 plus years or whatever. And then, you know, just kind of in a bit of a high agency way, the Yankees were like, hey, can we just make a better bat?
Like within the rules of the bat, like, you know, we're not going to have your bat, we're going to cheat. And they hired this MIT guy to think about it. And he was like, Oh, yeah, you could just like move more of the barrel to this one sweet spot. And if you hit that, it's going to go way further, way harder.
And you'll have less misses, less than your misses because you're going to have a thicker part of the bat right there. And you'll have more barrels and sure enough, the Yankees start to season off with like way more home runs than any of the else this year. I don't know anything about baseball, but is it statistically significant or do they just have ballers on their team this year? Is it like it is the bat?
I think it's the bat, but I don't know if it's statistically significant. I can't I don't know if he could say that, right? Because it was like they started talking about this when they jumped out to a big leave at home runs, like 14 home runs already. It was like, nobody else is even close.
So we'll see, you know, we'll see if this lands, but the important part is like who gets a shit about baseball. The important part was dude, if if baseball is like 100 year old sport that like, you know, people spend the team spent hundreds of millions of dollars a year trying to find any edge they can. If there's still like an edge like this to be found, it just proves how like so much of the world is like unoptimized and underthought about. And like if you actually just took a lot of focus and intensity to any one problem and you don't assume that people have already figured it out, that's one of the key things you need to have a breakthrough.
And so like when you're talking about studying these other models, I think it's so important to do that. I remember when we did our restaurant was my first time, but we did much everything wrong. Like every now that I look back, I'm like, Oh my God, so embarrassing every like the way we did our business plan. We brought a 300 page business plan.
It's like, dude, nowadays I write one page if that we literally printed out a binder. We were so proud of it. And we thought that that was like, you know, Mark of our brilliance. And actually, it's just a market worth stupidity.
Our marketing, you know, I used to just go door to door knocking on doors trying to sell sushi like an idiot. I didn't know anything about Facebook ads. You know, I didn't know anything about anything. But one smart thing we did was we were like, we were a delivery only restaurant.
So today they call that club. It's just back then that didn't exist door to door sushi. I think is the worst idea I've ever heard. Right.
But I was like, Oh, let's try it. By the way, who doesn't want to eat this at 10 30? And what if I have degrees of Dallas? No, what we did was I went door to door.
I went floor to floor really. I went into a skyscraper. I just went to the elevator, push the button one, two, three, four, get out. And I just talked to the office manager of each floor.
And if I could get her to cater the lunch, it was like getting 50 orders. It actually worked pretty well. So that's kind of like a bit of a bit of an example of this of ignorance is bliss. So the other thing that we did was we looked at delivery.
So traditional food delivery, like you were talking about city to city expansion. We looked at how all the big restaurants did the delivery. And what they did was they would basically have a delivery driver at the restaurant kind of waiting and waiting for a batch of orders. So you would order, but they wouldn't just take your one order.
They would tell there's like five or six orders to go, right? Because if I leave them with one order, that's inefficient. So they would first wait for five or six orders, then they would drive out. They'd go one place at a time, trying to deliver these things and they would drive back.
And what I was so confused about was like, how is this restaurant? That's one mile away. Why does delivery take 40 minutes? It just didn't make any sense.
Like the route is like two minutes. So like, how is it possible that it takes 40 minutes for the order? And so I watched them and we had our buddy Dan become one of them. And it was like, Dan, you work for Noodles and Company now, you got to figure this out.
But you were doing the deal move before dealing with it. Yeah, we said to the spy. That's being honest. We came back with was just like, do you don't need the food and noodles.
So much salt. And we're like, but what about the delivery? He's like, Oh, I didn't even get to the very side. So he's like, so much salt in his suit.
It's insane. So we figured out a breakthrough. The breakthrough was basically realized that it was at the slowest part of the delivery was not the drive. It was the driver doing that last kind of last mile, like the last 200 feet to your door.
So like finding the exact house or apartment and you go there and you knock and you wait. And then they come out and then whatever that was the way the slope part was. And so what we did was in downtown Denver, we created something called the drop zone in between, you know, whole bunch of skyscrapers. We just have one guy stand there.
He was our delivery guy on the ground and then the driver just kept going back and forth, dropping off orders to him nonstop. And this sped up delivery like crazy and suddenly our delivery times were like 15 minutes, 16 minutes, 18 minutes. And we were just crushing everybody on delivery and like the restaurant failed, but the learning of like, you can't really take for granted that like everything just figured out. And if you just do the first minutes, we'll thinking of like, you watch, you look for the slowest part, then you think, okay, what can we do?
Even if it sounds a little weird, then we're going to have a, we're just going to put a dude there at the bottom and he's going to stand there holding the orders, the delivery guy is just a stationary dude. But that would eliminate all of the lag of the driver having to wake up for that last, you know, to do all those last mile deliveries. That was the key for us. I found when doing this, there's a few hard parts, like just doing the exercise.
The hard part one is knowing what things to question and what things to accept. For example, let's say you're creating Tesla and you're like, well, electric battery, that probably can go long enough. Like if I look at this, the map behind it, but they didn't like change the shape of the wheel. That's a very obvious one.
But when you're running a company, it's very hard to decide what to question and whatnot to question. It's also incredibly challenging to get yourself into that mindset of first principles thinking and more challenging to convince your staff or your coworkers to ever to just like come with like an open mind and actually get on board and being open minded to trying this exercise. I found that to be hard. What's hard about it and then how did you try to tackle that?
For example, just like the people saying like, well, it has to be this way for these reasons and it's like you have to say to them, I know, but just like, I know you think that but just try to get beyond that just for a few minutes and let just have a conversation where it doesn't happen that way. What would happen? There's this book called the Six Ways of Thinking for Design. I forget exactly.
Do you know what I'm talking about that book? No, I haven't read that. Basically, it's like an exercise where there's six different colored hats and you're like, all right, you're green hat, you put your green hat on. That means you're just thinking of profit.
When you put your red hat on, that means you're going to come and be very pessimistic and poke holes and everything. Your black hat means you're open minded. And so it's this way of saying, right now I'm going to put this hat on, which means I'm going to by default, I'm not going to hate on anything because a lot of people default to this is why you can't do it. Do I'm going to figure out all the reasons why this could work?
Yes. Yeah. And so you do that, you try that? Yeah, and it helps, but it's still I guess what I'm saying is that nobody has.
No, it helps, but there's still like, it's still a challenge to get into that mindset, at least for me and also to like convey that to teammates. Again, having an open mind and question, everything is actually way harder to do than it sounds. You know what I mean? Yeah.
Yeah. I feel that people like it. Like, so once you give people permission to do it, they actually get excited about it. You're right that you have to sort of like frame it the right way.
If you just go into a meeting and you're open expectation is that people are going to be like open minded and creative and come up with a novel solution. It's like that can happen at all. Like you have to either tell a story at the beginning that gets them in the mind. So I've done that before, which is basically the Yankee bad thing.
I mean, that was pretty good. Yeah, like it'll be one like that. Or it'll be like, I remember back in the day, I watched this thing on YouTube. That was like really inspiring to me.
I don't know if you ever see that it's the IDEO grocery cart challenge. So IDEO was just this design thinking lab, this group. So companies go and pay them lots of money to come up with like novel, innovative solutions and designs. So I think 60 minutes or somebody went to them, some TV show and they were like, Hey, we want to understand how you guys think.
And so we have a challenge for you guys as part of the show. And they were like, we want you to redesign, reimagine the grocery cart in a day. 24 hours, 40 hours to do this. And so they break up into two teams and they show their process of how they do it.
Right. So like there's like a process of like fact gathering. So they first they go get a grocery cart or they go watch it in a grocery store. They want to see how the customer uses it.
They don't want to take anything for granted. So they're like, Oh, like certain set of customers actually use this as like a kid, maybe center, their kids sit inside of it. They need a thing to play. And that's like a key part of this.
Like if you lost the kid seat, you would lose that mom as a customer. But other people are loading up and they need the two racks. And then you know, so you're seeing how people use it. Then they were like, cool, and you state those observations, they put them on your next card, you start going on the wall and the guy sets the tone.
He's like, we're in the diverge phase and basically draws a little cone. I don't know if you've ever seen it's like a like a tone going out and he's like during the diverge phase, like whatever, a predetermined set of time. Our team knows how to do this, which is when you're super crazy, wacky ideas, free play, what if mode and you don't judge the ideas during this phase and trying to riff off, riff as many ideas again. And then we're going to switch modes, switch hats, like going to go to converge where we basically ruthlessly narrowing down the set of possibilities of where we might go with this.
But we distinctly have two phases because you'll want in the one phase, the one brave person to be courageous and throw out a half baked idea. And then somebody immediately smart guy slammed them and be like, why that would work? And now nobody wants to suggest ideas again for the rest of the hour. So you have to like really explicitly, like what you're allowed to say during this hour is only, you know, yes, hands and then during this one, it's a no butt.
And then they end up with this redesigned grocery cart where it's like, it was basically like, I don't know, you can look at the image of it online, but it was like a thing that was designed for a new type of grocery cart. And I thought about that. I was kind of inspired by that because, hey, I just thought, wow, what a cool job. This guy's get to be creative for a living.
The top cut does video is 15 years old and it says the top comment is they're still making us watch this for school, by the way, in 2024. Yeah, I actually think there should be a Netflix show of this, like, you know, you have chopped where they give them a random basket of ingredients, you got to make them be a lot of it. I would love to see like two teams that are like, you know, engineer designer types and you basically give them like a challenge, redesign the grocery cart, like redesign, make the inside of an elevator more entertaining. And just see what they do.
Like I would find that super fascinating as like a TV show. I think it would inspire a lot of people to become like engineers or designers if you watch that the same way like Shark Tank, although it's like totally like bogus in terms of like entrepreneurship that they show. It's super accessible. I guess we were excited about the idea of entrepreneurship.
This book sounds pretty great. Bad art. It sounds like a pretty good idea. It's a great book.
I'm excited about it. My only hesitation I had on it was like, I feel like I already got a ton of value and I got to be doing the like research and the kind of prep like of outlining. Oh, here's the big ideas and crystallizing them in my mind. So you're going to be like Eric from LA and you're going to say, F you reader.
Yeah, exactly. Do I need to go the actual publishing it for other people? I'm not sure that I care about that. Like I'm not going to make any money off this.
I'm not trying to get famous off the book. What do I do? I need to do that. So I might publish it.
The other problem is like, I'm not sure how many other people nerd out about this idea of making great art, making making great products, just insanely great things and caring about being like wanting to learn the creative process. Because you know, when I figure out that. That's obviously foolish. What about that guy?
Like, I feel like a lot of fun. Yeah, yeah, you got you caught me on the hook. You got the couple of months on the hook because I'm not that Austin guy. Like, you know, artists, what was it called?
Great Art of Steel. Is that what I want to just be that Austin guy? You didn't even know this guy's last name. I know the book cover.
What is it like? Like, what's it called? Great Art of Steel. Yeah, like, I know that a lot of smart people whose books I read, they always say that that like we had a Jack Carr on the podcast.
We wrote all these amazing fiction books. I love and he talked about it. Ryan Holiday talked about it. Mark Manson, who I know you like talked about that book.
Everyone. That's the thing. It's a lot of authors. For anybody who's like an author, screenwriter type of person, it's just that's such a small percentage of population that I'm not sure it's worth the pain of publishing.
But dude, if you feel the promise for Suede, we are not like the open public publishing this. If Silede Bloom can convince everyone in Twitter to share his book, you can too. What he's hilarious on Silede because Siled is great. And Silede's such a achiever.
You brought the PE energy to the author. He's about the Ivy League energy, right? He like he like achieved her just way into Stanford. I achieved her just way to be a good athlete, like a D1 athlete.
I achieved her just way into private equity successfully. I achieved her just way into a six pack. I achieved her just basically like, all right, Jimmy the target and like show me a show me a ladder and I shout climb. And it was like, when you're like, you should Twitter, dude, like your posts are kind of interesting.
I think you do this. It's like, cool Monday through Friday, 6 a.m. You got cold plunge, right? Thread published thread every day for the next 900 days straight.
Every day I make a million followers. You achieve with the shit out of Twitter too. It's amazing. Yeah.
Now you're going to get the same with that art. As Elon once said, when they asked him, are you afraid of failure? He said, it is not in my nature. That's not good.
It's not in my nature. That's going to be that should be the reply to everything though. As a great Elon Musk once said, this is not in my nature. How sick is that phrase?
How I like time with an alpha is that phrase? All right. Is that it? Are you going to go and enjoy the, um, enjoy the sand or doing whatever you do?
Do you even leave your apartment when you're in Hawaii? Yeah, dude. I mean, the ocean. I mean, I'm at the beach.
I actually do. They want to do everything. Are you going to wear a tweet? We're just doing the same day.
Every day for six days straight. Like it's the same day. But they love it so much that I can't help but love it too. All right.
That's it. That's a pop.