Be Your Best in 2026: The Most Important Lessons from The Knowledge Project (2025) Transcript from https://podmenti.com/t/0b16b9ca1fc1543a Welcome to the final episode of 2025. I pulled together some of my favorite moments from the year. These conversations help me think better, work smarter, and live with more intention. It's time to listen and learn. Toughness, kindness, and clarity. All three. But don't forget the toughness. 'Cause you don't want yes people around you. You want people who say when we push the boundaries of our thinking a i make me get to the answer perhaps more quickly. But you need someone with experience to know which of those references matter to the business. I am genuinely concerned that. because of different societal factors, because of people who maybe lost out on some social skills during the pandemic. There is not that rejection resilience that many of us need in life. You mentioned that we can engineer trust. How do we do that? One is repeated exposure. Second is establish a set of shared values. Everything is here to teach me and help me, it's all working for my good. So we're gonna go look for those moments when you're most uncomfortable and remind yourself, this is my teacher. From when a customer orders something. through the distribution center, how it's gonna be picked, packed, packaged and shipped. And when you look at that from a flow perspective, you start thinking about new solutions. getting really, really comfortable with being uncomfortable. is magic. And I wasn't always good at that. the right entrepreneurs, the best entrepreneurs, they just simply out care other people. When you talk about inputs versus outputs, what inputs do you think about in life? What I think it the inputs I think about are Um You know, there it depends on what I'm trying to get accomplished. But it if the inputs are just thinking about hard work What Do I get up every day? Do I if I stay healthy, do I get up every single day and work out? I I hear that you work out every single day because instead of trying to figure out which days you're gonna work out and it's always a negotiation. With which day is oh. Some days you don't feel like Um exercising. You just Work out every day. I have the same philosophy. Get up every single day and do the things that are important. Um so the inputs I have is I get up every morning, I work out. I look through I read through my email and I try to think about what's the most important thing that I have to get right today. What's the most And um And think about first order issues. What is the first order issue that I have to solve? What is the first order issue of a company that needs to get fixed. Um what is the first what is the thing that I need to do to influence an outcome for Um for a founder. And You know, that's very, very clarifying. W often we can create a very, very long to do list and then you've got to pop up a level and just look at the to do list of what's the most important things I have to get accomplished. Because if you just list all the desers, you probably will not be able to get to all of them. And the most important thing might be the last one you list. And so you can't just go down that list and do them one by one. Often It's by popping up a level where you sort of look at the whole list and it's like Okay. Well, most of this is not important. Is that what you mean by first order issue? I think you mean something a little more nuanced. Some people talk about the most important thing. Um And I think I think about First order if I get this problem it I have a problem on my hands if I get to the first order issue and get to the root cause of that. Usually. That helps. Sol that problem. And there are other issues that are not first order. Um and That concept is Quite important. But we also sort of navigate that into other uh situations where Um Where they are crucible bumps. So as an example, like Yeah. Yeah, situations where The website's not working fast enough. That's Atlas. We had a situation where the website's not fast enough. Is the first order issue that we have too many pictures? Well, we want the pictures. We have lots of photos. We want to show those photos. Is the first order a shoe that we need to Um Well, Customers want Longer search results. Like no, it's none of that. We need to figure out how to make the website go faster. And so we start caching. the the search results. We start caching things. And so you start developing the technologies that solve the speed issue, but the first order issue is that we need to solve this with technology, not with A bunch of Either or solutions. Um, that's an example that I learned a long time ago. Another situation is The distribution at Atlas was not. Flawing. Well. Um And we couldn't figure out which Process was broken. Was it the picking process? Was the Was the ordering process broken? What was broken about it? And We went and just looked through. The flow. And the flow was broken. And so uh there's too many handoffs uh across all of these different discrete processes. And so we have to sort of pop up a level and figure out what the flow of From when a customer orders something. Through the distribution center. How is gonna be pick packed? And uh packaged and shipped. And when you look at that from a flow perspective, you start thinking about new solutions. that allowed there to be much better flow throughout the distribution center than been than to batch things. for picking batch things for um packing patch. That's batch things for Uh for shipping. That's what you mean by first order? Uh, I wanna get into more of your experience not only at Zappos, but uh being on the board of some of the companies that everybody has heard of. um today or being involved. But before we get there, I want to come back to the school for a second. Are there any other experiences that you had during school with teachers that might have impacted you? You know, earlier on in junior high school I was um I was suspended from the computer lab because I built No, this was very old, so They're a radio shag T R S eighties, so we call them trash eighties today. Um And there was the computer lab uh you know you you have to run time in our computer lab to to use the computer and I built this game and The central server. at the time was literally a floppy drive where ever all of us saved our programs there and One day Uh a bunch of The students uh in the computer lab all found the game that I programmed and then started playing with it. the teacher and the principal just happened to walk in and saw that we're all playing this game. And um I was told that computer lab is valuable time and you should be doing something much more productive than than producing a game, so I I I was no longer allowed to work in the computer lab. And the Computer lab teacher was Mrs. Patosa and she's she also ran the math team and she said, Well Yeah. I'm sorry, the principal wants you out of the computer lab, but you should join the math team. And I joined the math team there and um one of the things I was very good at was math and she told me that if you want to be a leader and you want the team to win. It's not good enough for me to just solve the problems. figure out how to get the rest of the team to perform. And so I started teaching The rest of the math. Team. Some of the reasons why I was able to solve some of these problems more quickly than there were. They're very talented, but I had figured out tricks. that they had not figured out. And they taught me tricks that I had not figured out. So we got better and better by riffing each off each other. And so I'd learn the value of teamwork by just being thrown into a situation. Like that. Such an interesting front row seat into what's happening. Do you think founders go astray when they start listening to too many outside voices? And this goes back to the I'm sure you're aware the Brian Chesky You know he founder mode. The founder mode. Do you think talk to me about that. I have such a newest point of view on this because It is decidedly not simple. Uh so Broadly speaking, I really like the spirit of founder mode, which is just having deep founder led accountability for every decision at your company. Um I think that that's how great companies operate. Uh and When you you know, proverbially make decisions by committee, or you're f more focused on process than outcomes. Um, that produces all the experiences we hate as employees, as customers. You know, that's the proverbial DMV, right? You know, it's like process over outcomes. Um and then similarly Uh you look at the disruption in all industries right now because of AI, you know, the companies that will recognize where things are clearly going to change. Like everyone can see it. It's like a s you know slow motion car wreck. Everyone knows how it ends. you need that kind of decisive breakthrough boundaries layers of management um to actually make change as fast as required in business right now. The Issue I have not with Brian's statements. Brian's amazing is how people can sort of interpret that and sort of execute it as a caricature of what I think it means. Uh You know, there was a I remember after Steve Jobs passed away, and you know, um I I don't know Ste I've met Steve a couple of times. I I haven't never worked with him in any meaningful way. You know, but he was sort of uh if you believe the story is like kind of uh pretty hard on his employees and and very exacting. And I think a lot of founders were like mimicking that, you know, done to wearing a black turtleneck and yelling at Yeah, their employees. I'm like Not sure that was the cause, you know. Uh I think Steve Jobs taste and judgment through you know, executed through that, you know, packaging was the cause of their success. And Somehow. And then similarly I think founder mode can be weaponized as an excuse for just like overt micromanagement. And that probably won't lead to great outcomes either. And most great companies are filled with extremely great individual contributors who make good decisions and work really hard. And uh Yeah, companies that are like solely executing through the judgment of individual probably aren't going to be able to scale to be truly great companies. So I have a very nuanced point because I actually believe in founders. I believe in actually that Accountability that comes from the top. I believe in cultures where you know, founders have license to go in and all the way to a m small decision and fix it, the infamous question mark emails from Jeff Bezos, you know, that type of thing. That's that's the right way to run a company. But that doesn't mean that you don't have a culture where individuals are accountable and empowered and uh you don't want uh, you know, people trying to decide make business decisions because of what will please our jo leader, you know, which is like the caricature of this. And so, you know, if after that came out, I could sort of see it all happening, which is like some people take that like, you know what? You're right. I need to go down and be in the details and some people will do it and probably make everyone who works for them miserable and probably both will happen as a consequence. So Totally. Thank you for the detail and nuance there. I love that too. Do you think engineers made good leaders? I do think engineers make good leaders. But one thing I've seen is that I think that I really believe that Great. CEOs and great founders um start usually with one specialty, but become Uh more broadly specialists in our parts of their business. Um you know, I think the uh businesses are multifaceted and rarely is a business's success due to one thing. Uh like engineering or product, which is where a lot of founders come from. Often your go to market model is important uh for consumer companies, how you engage with the world in public policy becomes extremely important. And I think as you see Um uh founders, you know, grow from doing one thing to growing to be in a real meaningful company like Airbnb or Meta or something, you can see those founders really transform from being one thing to to many things. Um so I do think engineers make great leaders. I think the first principle's thinking the system design thinking um really benefits things like organization design, strategy. Um and But I also think that, you know uh when we were speaking earlier about identity I think one of the main transitions founders need to make, especially engineers, uh is you're not like the product manager for the company, you're the CEO and w do you spend time recruiting an executive because you have a need? Do you spend time uh on sales because that will have the biggest impact? Um, do you spend time on public policy or regulation because if you don't uh it will happen to you and and could really impact your business in a negative way. I think Engineers who are unwilling to elevate their identity from what they were to what it needs to be in the moment often leads to sort of plateaus uh in companies growth. So A hundred percent. I think engineers make great um leaders and It it's not a coincidence, I think, that most of the Silicon Valley Great Silicon Valley CEOs came from engineering backgrounds. Um But I also don't think that's sufficient either as your company scales and I think that Making that transition as all the great ones have is incredibly important. To what extent are all business problems engineering problems? That's a deeper philosophical question than I think I have the capacity to answer. Um, what is engineering? What I like about Approaching problems. Uh as an engineer is uh first principles thinking and understanding uh the root causes of issues rather than simply addressing the symptoms of the problem. And I do think that Coming from a background in engineering and that is Um everything from process, like how engineers do a root cause analysis of a outage on a server is a really great way to analyze why you lost a sales deal. You know, like I love the systematic uh approach of engineering. One thing that I think going back to good ideas that can become caricatures of themselves. Like one thing I've seen, though, with engineers who go into other disciplines is Um Sometimes you can overanalyze decisions in some domains. Let's just take modern communications, which is driven in social media and and very fast paced. Um Having a systematic first principles discussion about every, you know, tweet you do is probably not a great con strategy. Um and so Uh and then similarly, um You know, there are some aspects of, say, enterprise software sales that you know, are rational, but they're human, you know, like for me in personal relationships, you know, and and the the importance of those to building trust with a a partner it's not all just you know product and technology And so I would say I think a lot of things uh coming with an engineer mindset can really benefit, but I do think that uh taking that to its like logical extreme can lead to analysis paralysis can lead to uh overintellectualizing some things that are fundamentally human problems. And so Yeah, I think a lot. Can benefit from engineering, but I wouldn't say everything's an engineering problem in my experience. You brought up first principles a couple of times. You're Running your third startup now. Sierra. It's going really well. How do you use first principles? In terms of How to use that at work? Yeah, it's it's particularly important right now because the market of AI is changing so rapidly. So If you rewind two years, you know, most people hadn't used chat GPT yet. Uh Most companies hadn't heard the phrase large language models or generative AI yet. And in two years you have ChatGPT becoming One of the most popular consumer services in history, faster than his than any service in history. And you have to have a Across so many domains in the enterprise. Uh really rapid transformation. The law is being transfer transformed. Marketing is being transformed, customer service, which is where my company, Ciro Works, is being transformed, software engineering is being transformed. And The amount of change in such a short period of time is uh I think unprecedented. Uh and uh perhaps I lack the historical context, but it feels faster. than anything I've experienced in my career. And so as a consequence, I think uh if you're responding to the facts in front of you and not thinking from first principles about Why we're at this point. And where it will probably be twelve months from now, the likelihood that you'll make the right strategic decision is almost zero. Uh so А за Uh it's really interesting to me that with modern large language models, one of the careers that is being most transformed is software engineering. Uh And You know One of the things I think a lot about is How many software engineers will we have our company three years from now? What will the role of a software engineer be as we go from being authors of code to operators of code generating machines? Um What does that mean for the type of people we should recruit? And if I look at the actual craft of software engineering that we're doing right now. Um I think it's literally a fact that'll be completely different two years from now. Yet I think a lot of people building companies hire for the problem in front of them rather than doing that. But two years is not that long. Those people that you hire now. will just be getting really productive a couple of years from now. So we try to think about most of our long term business from first principles, everything from I'll say a couple of examples in our business. Our pricing model is really unique and comes from first principles thinking rather than Having our customers pay a license for the privilege of using our platform. We only charge our customers for the outcomes. Uh meaning if the AI agent they've built for their customers solves the problem. There's like a usually a pre-negotiated rate for that. And that comes from the principle that in the age of AI, software isn't just helping you be more productive, but actually completing a task. Uh what is the right and logical business model for something that completes a task, while charging for a job well done rather than charging for the privileges of doing the software. Um Similarly, um, you know, we with a lot of our customers, you know We help deliver them a fully working AI agent. We don't Hand them a bunch of uh software and say, Good luck, you know, configure it yourself. And the logic there is, you know, uh In a world where Uh Making software is easier than it ever is before and you're delivering outcomes to your customer. Um the delivery model of software probably should change as well. 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So I was recently speaking to somebody, she's a sixteen year old entrepreneur, and she's trying to deliver help for teen daters. And she said by far the number one thing that she gets questions about is How to deal with rejection. And so I am genuinely concerned that Because of different societal factors because of people who maybe lost out on some social skills during the pandemic because of people who live a lot of their lives online. There is not that rejection resilience. that many of us need in life. So if you want your dream job, you need to go out there, get a lot of no's and go after it. You don't just sit at home waiting for a LinkedIn recruiter to message you about your dream job. That that doesn't happen. You have to make it happen. And the same thing is true with dating is that you have to shoot your shot. You have to approach people in public. You have to take a risk. And so I'm encountering a lot of people who are very afraid of rejection. And are not taking those risks, and I think that it's leading to fewer relationships. I'm a make it happen kind of person in in work and in life. I also know that that can come off as aggressive or assertive. How how do you deal with that? That's interesting. So what's a scenario that you feel like could come across the wrong way? All make it happen is like you have a great first date or something and then you're instantly like on to the next date. You know, you're like, I wanna see you again. How about tomorrow? And then the other person I don't know. Like I I feel like we're just in a society now where You know, you're supposed to wait till tomorrow almost and I hate personally waiting. I'm sure there's other people out there like me too, where it's like, no, you're in charge. You have agency and you can make The world happened. I love this question because I think it speaks to a really real phenomenon where people are experiencing excitement about somebody, but they feel like they need to hold it back to seem cool. And so I love to talk to people about attachment theory. Has that come up on your podcast No, let's go into it. Okay, so attachment theory is something in the world of relationship science that's truly backed by the research. It's something that first came about around sixty years ago with someone named John Bowlby. And this research was originally done with children to see their attachments to their primary caregiver, but now we have an entire field of adult attachment specifically around relationships. And so there are people who are anxiously attached. What happens for them is their story of love is that I'm gonna chase you, I have to convince you to like me, you might pull away and And we're gonna have this chase dynamic and that I'm constantly worried that you're not gonna be interested in me and you're gonna disappear. So how those people show up in relationships and I know because I really was one of these daters is if you don't hear back from somebody, you start spiraling, they met somebody else, they don't like me anymore, you send a bunch of text to try to reconnect with them, and you're often just in this danger zone where you're not being the person that you want to be. because you're trying to have this reconnection moment, you think somebody's gonna pull away. Then there's people who are avoidant attached. They sort of have the opposite experience. Their version of love is I'm gonna be smothered, I'm gonna lose my independence. And when they get too close to somebody, they are the ones pulling away. So they're the ones, you know, great sleepover on a Saturday night, Sunday morning, they wake up, the person hasn't left, and they're like Damn, should I call her an Uber? Oh my god, that's me. That's you? Yeah. You have that feeling of like I need my space. Well, I need my space and I don't want to get hurt. There's like an element of Vulnerability. Absolutely. What you're talking about is completely true. It's not that those people don't want to be in intimate connection, it's that the fear of being smothered or the fear of being hurt. causes them to pull away. I'm gonna reject you before you reject me. And so for those avoidant attached people who think that they're gonna be smothered And then for the Anxiously attached people who think they're gonna be abandoned, what ends up happening is they often date each other and they reinforce this idea. So I think that love is a chase. You think that love is being smothered. So when I go after you, you pull away. That reinforces mine and that reinforces yours. And anxious, attached, and avoidant people keep dating each other in this anxious avoidant loop. That leaves both people feeling pretty unhappy. But There's a third type. Of securely attached people. And these are people who have a healthy relationship. With independent and with intimacy. I want to be close to you, but I also respect and need my alone time. And so often the way that people get out of the anxious avoidant loop is they either become more secure themselves Or they date someone who's secure. And so that's what happened for me after, you know, ten years of chasing after different people, being rejected, being disappointed, thinking, Well If only I could prove my value, then this guy would like me. Instead, when I dated somebody who was secure, it broke a lot of those patterns. And We formed what I feel like is my first really healthy relationship. what happens is fifty percent of the population is secure, which sounds like a good thing, but those people are so good at being in relationships that they often get snatched up and you have the anxious and avoidant people dating each other. But in the example that you described. It can actually be very secure for somebody to follow up after a date and say, Hey I really enjoyed getting to know you. I'd love to see you again. When are you free? And in that moment, somebody who's used to dating somebody who's avoidant might be like, Whoa they're coming on too strong or That's so obvious. They're so obviously interested. That's boring. But a ton of the work that I do is training people to identify secure partners and to reestablish them in their heads, not as boring, but as secure and to know that those are the people to go after. So sometimes that person who pulls away is exciting that sparky feeling because you don't know if they like you or not, but instead really honoring the person who says I like you, I'm interested. When can I see you again? And so the slight tweak that I would have to yours is not I like you, can I see you tomorrow, that does kind of feel a little bit intense, but being clear about like, hey, that was a really great date. I feel like we really connected. I'd love to see you again. And then like working together. To come up with the next date? And a lot of dating that people miss is that it's about matching somebody's momentum And matching somebody's speed. So it's a dance where I take a step forward and then you need to take a step forward. If I take ten steps forward, you might feel overwhelmed and take a step back. So just paying attention to are you always the one reaching out? Are you always the one making plans? There needs to be momentum matching. For the speed to feel right to both people. Well I think the big thing about preparation and success is is the price has to be paid in advance. You have to put in the work before you get any results. So there's no way to to honestly know how good your corporation is or isn't Um that's why I always try to emphasize keep preparing, keep working. Um you don't know what the other guy's doing. He might be you know, working just as hard as you are in in that preparation. you know, y it can't be after the fact of like oh I wish I would have studied more It's too late at that point. You have to do it on the front end. So Um Getting in condition. Um, you know, studying preparing all your film and your opponents and all that. Like those things are are all have to be done on the front end and you know, a lot of times Uh, there's I would say a little bit of a tendency to just sort of let up on the preparation. Well, I watched some film, well I've done some extra sprints. Well, I've done this, I've done that. Well, is it but is that enough? You know, is it really enough? And and If you do more, will it make a difference? Um not to the point of diminishing returns, but to the point of you know, comprehensive preparation. So Um That that's really what we try to ex uh try to um I'll emphasize on that. The way that I think about that is sort of the you know, the pain of losing is sharp, but it's over fairly quickly. But the pain of regret Not putting in the work, not doing the things, you didn't leave it all in the field, that lasts forever. Exactly. That's exactly it. The pain of regret is much more than than the pain of preparation. Absolutely. I think you had a twenty four hour rule sort of after winner losses, you have twenty four hours to think about it and then you're you move on. Is that right. Yeah, you play the game, you go back, you analyze it, you what do we do well, what did we do poorly, what do we need to do better, what adjustments should we have made, what coaching errors did we make. And so forth and and then you you factor all that into You know, how does that affect this next week? Sometimes there's a lot of carryover. Sometimes the play team you play the following week is completely different and Some of those lessons may not really become app applicable for a week or two weeks or three weeks. Until you see a you know a similar type of opponent. Um, say like a scrambling quarterback, you know, maybe you play two or three weeks where those quarterbacks Aren't too mobile and when you get up against another scrambling quarterback, you go back and look at a how you know, how how do we need to to handle this better? uh against this type of an opponent. So Um but yeah, you look at all those things after twenty four hours, win or lose or draw. Are you Yeah. Take your lessons and and you decide how you're gonna incorporate any of those things into this week's preparation and practice, uh what we're gonna do differently, or maybe do more of or do less of, whatever it is. Um and then You're done with that and you move on to your opponent and and spend the next uh Five days. Six days, whatever it is, of just You know, digging in on that opponent and And what they do. Talk me about the relationship between the best talent in the world and You know, you're playing in the NFL, you're coaching in the NFL and confidence. Well, again, it it's all relative, you know, Shane. I mean, as good as um As good as as the players are in the NFL Um the guys on the other side of the ball are pretty good too. And um You know, I'd say every team, generally speaking, every team has about you know, five or six players there. Elite. have elite payments, elite contracts. Uh, and then you might have some younger players in their first through fourth year. You know Two or three four whatever those. That are elite players that just haven't hit those top contracts yet. Um But they don't necessarily match up in the same position. You might have a tackle, I might have a guard, you might have a linebacker, I might have a a corner, and so forth. Um so Um the way those elite players match up is is very um specific from game to game. And how you wanna match them, your your matches against theirs. And how you want to deal with that is, you know, that's uh a big part of it. I I think the confidence thing is really Um interesting. I I think what really separates the great players Um is their ability to do it even when the bullseye's on their back every week. Um, like it was with Tom Brady, like it was with Lawrence Taylor, like it is with Patrick Mahomes, um, like it is with you know Players like that, Lamar Jackson and so forth. Every week the the teams are geared towards stopping those players and game planning against them or putting their best guy on them or or however they're gonna handle them. And for those players to continue to be productive. Um in spite of the game plan attention they get. Is is what truly makes those players, you know. I think that um You know, when we had Kobe Bryant come in and talk to our team, I think it was around eight two thousand eighteen, nineteen, somewhere in there. And You know, Kobe talked a lot about evolving. You know, and he's uh Um You know, look, it when I was twenty two, twenty three. you know, I could just get the ball and drive by anybody and and score. He said, I can't do that anymore. I still score, but I found different ways to score. moving without the ball, jump shots and you know being better in pick situations and all those kind of things. Um, that you know, he said, I found I found ways to evolve my game. Um because I just couldn't do the things I used to be able to do as well. Um, but there are other things I found that I can actually do better. And I thought that was a great message for all of us to hear that as we Um you know, as w as we go through our careers. Do the things that are working, do the things that are you can do well, but also evolve, continue to learn, continue to, you know, find ways to to be productive that are maybe a little out of your comfort zone or Um Or not um, you know, habitual for you now. But if you can become good at'em. Um, they can be great. You know, great tools for you. Are there any other people that you brought to speak from sort of different sports that sort of had Uh a different Message that resonated with you or the team and just stands out in your mind? Oh yeah, we had a lot of'em. Yeah, we had a lot of them and and it was great because, you know J the guys you know, they hear a lot of football stories, but it's good to hear all the ones of one of the ones I thought was particularly entertaining, a couple of them, one was uh Paul Asciante. They won like Fourteen national championships in a row. They won like a hundred and sixty some games in a row, matches in a row. I mean and At the Patriots, we were favored in almost every game, you know. Not every game, but most every game for quite a while. And so you know, I brought Coach Aceante and I said, you know Here's a guy's won like thirteen straight national championships. They won one hundred and sixty some matches in a row. I mean you talk about being favored now, like They're favored. And And and like let's listen to what that's really like. And he was great. He talked about It it doesn't matter whether you are or aren't, or how many you have or haven't won. Every day is an opportunity. You make the most out of each day and you just get better each day. And you don't worry about what you've done in the past. You just you look at today's opportunity and make the most out of it. It was great. So One of our coach one of our players takes his hand up and says, Hey coach I have a question. What's squash? I thought it was a vegetable. Oh. Jimmy Johnson, you know, we were going into the playoffs and and Jimmy came up and he was doing a um Uh you know, a story on somebody and I said, Hey, would you mind, you know, talking to teams? Sure. So he said, Yeah, let me tell you a little play off story here. You know, when I was in Dallas, we were getting ready for the playoffs and Uh, we're in a special teams meeting. I'm standing in the back and I see I see one of our one of our players back there kinda dozing off and and not paying attention. And he said he wasn't a he wasn't a starter, but he played in special teams. And he said it just really annoyed me and so I went over, I flipped on the lights, turned the lights on and meeting Yeah, I I went over to him, I said, That's it, you fall asleep in this meeting. Uh we don't want you. This is your primary job. You take your playbook and and go see a general manager, you're done, you're cut. Everybody like Who know that that woke everybody up and it you know it was right before the playoffs. So Yeah, any questions? Um yeah, coach. Um What would you have done if that had been Troy Eggman? Shimmy said, Well I wouldn't have turned on the lights. I probably would have gone over to him and nudged him and said like Hey Troy. Pay attention. And The message was If you have a lot of pelt on the wall You you you might have a little more slack. If you don't have a lot of pelts on the wall You don't have any room. You don't have any room. You can't live on What you've done because you haven't done enough. You better know where you are. And until if if you're Troy Eggman and Tom Brady You you go but he goes, Those guys would never do that anyway. But you m that you might be able to survive that. But if you if you don't have that kind of resume, you haven't had that kind of production for this team. So you nobody wants that. You're replaceable. They'll find somebody else who will stay awake in the meetings and who will be more attentive. And uh that's pretty funny. I'd just nudge him and say, Hey, pay attention. As a leader, you've called yourself Blunt and direct when delivering a message to people. I'm curious what you've learned about Delivering a message that gets heard. You know, it's a evolving process, if you want to call it that. Sometimes you people d deliver messages that are not heard. Because You haven't really delivered the message. Candy. People actually come out of performance appears and say, Uh, I think I'm doing a good job. And you're going to be able to do it. Oh my god, I hope. That's not what you heard. You think to yourself, because this person was supposed to have told you the three or four things, areas that you're supposed to improve upon and The three or four things that you did wrong? You're supposed to have gotten very direct feedback. People don't like conflict. People don't like to deal with issues. Directly. They like to beat around the bush and then leave saying I think I give the person the message. I had the opposite perspective, which is Give the message do it in a supportive way. And make sure that whatever you tell them they have to work on, you help them get to that. So I chose to write performance appraisals which said This is what you've done well. This is where I think You didn't do well. This is what you need to work on. And if you were to work on these issues and show progress, this is where you could go. So you see what this letter did was Celebrate them for what they did well. Told them what they didn't do well. Told them. The three or four things they had to demonstrate. Progress on. In the next year. And how I was gonna help them? And then also told them, If you showed progress, this is your trajectory. Because if we don't do it I think we're not getting the best out of people. There's a kindness and clarity Toughness, kindness, and clarity. All three. But don't forget the toughness. Because You're confronting them and saying, You know I asked you to really get to know the international markets. You made two trips internationally last year. And each trip in three days you came right back. How could you have learned international markets without getting out of the office in the US? Okay? And then you write saying, I'd like you to visit the following countries next year. And when you visit those countries, make sure you w go down to this level of detail. You know, some people would say A CEO shouldn't be getting to that level of detail. Yeah. They're right. But if I truly care about this executive and I think they have great potential, I will get to that level of detail. And I will monitor it middle year middle of the year and say, Hey Did you make any international trips? Did you follow anything I said? And if they say nah I really don't want to go, then you go back. You know, you don't have the potential to be a CEO. From the outside, we hear these stories about how CEOs pay attention to the top fifty of the top one hundred. How many people inside were you really monitoring and trying to develop and having a personal, a real one to one personal relationship where you're doing this and you're in the weeds and you're in the performance report and you're trying to build them? I think there's about three or four hundred that were corporate assets. And one watch them all the time because these are people who in fifteen years could be CEO. There's something about them that you know, you sort of caught your fancy when you were in a meeting. Or They had brilliant ideas. Not brilliant ideas that reinforced your thinking. Brilliant ideas that challenged your thinking and took us to a better place. Because you don't want yes people around you. Um you want people who say, Why don't we push the boundaries of our thinking? What if we approach this creatively? And people will put the company before themselves. I look for that all the time. Uh and so There were three or four hundred people that We actually call them corporate assets. And we track them. We game plan them, give them the right assignments, and even if they couldn't move Could we give them interesting assignments so that they could Get the experiences without constantly moving. So that's the number of people Uh Retract. What were the signs that somebody was putting the company ahead of themselves? Uh they would put their hand up for difficult assignments. And um If something went wrong, they didn't look for somebody else to blame? They would take the blame and say, Hey, you know, I could have done a different job, or I could've led differently, or I could've staffed my team differently. Um These are people who would come to me and say, You know Whatever's going on in this other part of the company I think Maybe Putting something in jeopardy. And I'm not throwing them under the bus. Would it be okay with you if I went and worked with them? To perhaps write things. And I say be careful how you do it. But go for it. And I Well tell them that I didn't send you there. That you were doing it out of your own uh good nature. Otherwise people say oh the CEO's got some pets that she's sending Oh they. So you've got to be very careful how you deal with organizational dynamics, but These are people who look around themselves and are constantly looking for ways to improve the company as opposed to How do I get the next promotion, the next raise? You said a lot of people don't read the footnotes or the financial statements. Is that changing in a world of AI where you can sort of like download the financial statement, pop it into AI and say, What do I need to know? I think it's It's actually Exacerbating the situation. Oh, spend a few beats on that. Because Now read the financial statements, Anthony. I just put it into AI. I asked Chat GPT to tell me that What about this? Look for that, look for that. And there's there's all the instances of those things. And then I just read it and it's all there. Well, did the AI miss it? Did the AI understand the linkages between each of those sightings? If I'm if I'm looking at, for example, I was looking at a company recently And I was looking at it was capitalizing costs. Okay, this is a REIT. And if it capitalizes costs versus putting them through the income statement, uh if it goes through the income statement and makes their operating earnings Look poor. More. And their net EPS ultimately. But if they put it on the balance sheet Well, you know, that's an investment in the future and everything looks okay. Right. And so there's a gray area. Was it an operating expense or was it a capital item? And so I was first thing I looked for was capitalized interest. That's what gave me all the quotes. And then capitalized costs and gave me all the quotes. So then you think that that's enough. But you have to then uh and I and I was showing one of my guys this, I so then let's go to the income the let's actually pull up the statements where it told us to go,'cause AI made it faster. I now no no longer needed to flip. the three hundred pages, but it it gave me where to go. So now I went there and now I could say, Well, that means if that is what's happened, then we need to look at this other note to see what you know the implications of that. And then we gotta look at the cash flow statement to see how it's actually impacting what ends up being reported as as cash flow. And so those linkages come it the AI makes me get to the answer perhaps more quickly. But it's my if I don't already know where I want to go. Then AI just gives me information. But that information doesn't help my decision if I didn't start with Where I want to get to. And it sounds like that information doesn't help your decision if you don't know the second, third, fourth order consequences. This is I love it. If that's where investors go and that's where they're going, everything's going to AI. the the bottom level of being an analyst The junior analyst is is gonna be replaced by an AI. The one that said, Find me all the references of, you know, where the company capitalized costs. That the AI can do. I get it. But You need someone with experience to know what which of those references matter and to what that means to the business. And this brings about a number of challenges because well if that junior person doesn't learn doesn't get on the in on the ground floor, they'll never learn to be able to make all those connections. And the only way to learn is sort of like being in the weeds and not being in a In fact It ties to so many things I I with my own children I've seen growing up when we went to school and we were in elementary school, we would be You know, w we'd have to do the math Tables. And and recite them. Yeah. Two times two is four and so on. I remember I was struggled with my with my nine times table and then my twelve times table, and so I had to memorize them and get them going. But then my children came along and they were using a calculator. And apparently that was okay. I went bananas. I said you're not gonna use the calculator. You need to learn it without the calculator, and then you can use the calculator, which is the same with AI. You need to understand how the financial statements are prepared, understand the linkages, developmental models so that when the AI gives you information. M you can you can digest it. And make decisions. reminds me of this funny story. When I started university, uh I ended up in first year calculus. And for whatever reason the professor who was supposed to teach that class couldn't teach it. So the dean of the math department took over. And on the first class, in the first like minute. He said there'll be no calculators in this class. Mm. Nobody, of course, listened to him. 'Cause graphing calculator, you're like, Oh my God, this makes my life so much easier. We show up to the final exam, which is like I think Eighty percent of your final mark. Yeah. And On the front page is no calculators. And He did not grade that on a curve. And it was not pretty for most students. I taught at university for about uh fourteen years. At York. And uh Truly f one a a very fulfilling time. uh my life and uh I still love doing uh guest lectures. I remember I I I would always start to c the you know, I would go over the outline and I and I would tell the students I said So Assignments are due at the beginning of class. If they're handed in after The eight thirty start time? It's a zero. It's a zero. And invariably At some whether it was the first and usually the first or second assignment, somebody would show up and hand it in late and I would say it's a zero. Yeah. And they would whine and say it's how can you do that? And you're so draconian. And I said, Well, you think in the real world When an RFP is required and you've signed with the contract with a client that they demand the report by nine AM on Monday and you show up at nine oh five. How's that look? And somehow it's okay. So it wasn't okay in my class. And and ultimately I think you you build respect because people see there there's a rule. And has followed. And then people have respect for the rule. There's this sort of like weird dichotomy, I think, with students right now, and dichotomy is probably not the right word. There's this weird path where students are coming out and they're more powerful and capable than ever because they use AI by default. And so they can get more output. than somebody who's maybe been in their career fifteen Twenty years. And I I I use my fourteen year old as an example. You know, in a world where he never had to show up to work. He's a mid level employee at most companies based on output. If you never saw him. He can give you the the exact same output that a mid level employee is gonna give you if everything goes right. But the minute something goes wrong. He doesn't quite understand all the nuances and all the and AI the I guess the race for him is like will AI catch up? quicker, you know,'cause he uses AI by default. And I sort of think about this as like making a recipe, right? Like if I pull out a cookbook And I make a recipe and I do everything perfectly. You wouldn't be able to tell the difference between me and the chef. Like the food, maybe it's not plated as well, but it's gonna taste great. It's gonna taste the same. You'd be like, this is amazing. But if something goes wrong, if the oven's too hot, if I don't stir enough. I don't put enough salt in. I don't know why. it didn't go right. But the minute a chef, the chef who created that recipe, who's got all the experience, who did the You know, who's made it hundreds of times. They taste it. They're like, Oh, your oven said three seventy five, but it's actually three fifty. You stirred this too much. You let this boil. You they instantly know what went wrong. Yes. And I wonder if in a world of AI, That's the nuance. And I I was talking to Steve Schwartzmann about this in a different context. But he basically said, you know, a lot of the analysts coming up They know the numbers, but they don't know what the numbers mean. Correct. Experience teaches you judgment. And and you talk about this in your book. It's all about the mental models. I I I believe that strongly. The experience teaches you what the numbers mean, as we've spoken about. And when you have experience you say I've seen that before. And a lot of the things I see happening today. Link back. when I started my career over the last thirty years. And I think that's something that the AI can't quite do. Unless you tell it where to look. Because it doesn't know the link board that I'm thinking about. Right. But if I if I can make the b initial stage, it can help me. Get there quicker. And more accurately. But if I don't a if I don't already have a model of what I'm looking for. It's not gonna get there. So you use the word trust and I'm wondering, is there a nuance with likability? 'Cause I had heard before, and I don't know where I got this from, but I remember reading something about like we're more convinced by people we like. And you used the word trust, and I'm wondering if that was Conscious. We're more convinced by people we like and we Like people that we trust. Okay. It is possible to believe someone you don't like. It is Um like picture someone that you really dislike and they say they're gonna do something, but you immediately believe that they're going to do it. So let's say that there's some foreign adversary who makes a threat and you believe that they'll follow through on their threat, because they usually do, even if you don't like them, that is possible. But there definitely is a link between um if you like someone, you're more likely to believe them and if you if you believe someone, you're more likely to like them. Uh, and I think that liking is actually really underrated. So have you heard of the affect heuristic? Yeah. It's you know, we have different decision making heuristics. We have mental shortcuts. Because we don't have all the time in the world. This is like an evolutionary thing that everybody has this uh w we don't train it, it's just it just comes with us, you know, out of the box. We don't have all the time in the world to take in every single piece of information and make a decision all the time. Sometimes it's like if you see smoke, you just gotta go. Right. And so we make um We take mental shortcuts. all the time and one of the big mental shortcuts is If we like something and feel comfortable with something it's more likely to be real, someone we like is more likely to be competent, someone we like is more likely to be smart. All these things just kinda go together. And so liking is at the center of that. You mentioned that we can engineer trust. How do we do that? One is repeated exposure. So in order to trust somebody First you have to have a sense of who they are. Like you won't you wouldn't trust a stranger, you wouldn't trust a mystery man. So one is you have to know Who who are they? They have the show up enough for you get a s for you to get a sense of You actually know them and they're not a total stranger to you. It's hard to trust a stranger. But it's easy to trust even a stranger that you have a parasocial relationship with because they're not a stranger. They're people that you've never met in your life. Oh. Because To them you're not a stranger. So first is just Become not a stranger. Second is establish a set of shares. I wouldn't necessarily trust your opinion on a restaurant. Unless I knew that you and I like the same type of food. So if you are like a vegan that hates spicy food and w whatever, I I probably wouldn't take your restaurant recommendation, um, even if I like you as a person. Right. So you you have to establish some shared baseline. of values. Here are some core things that I believe about the world. And if you share them? Then listen to what I have to say next. If you don't share them. That's okay. Right. Not everybody has to shout'em. So they have to get a sense of who you are and you're not a stranger. And they have to get a sense of how you think and how you view things. such that when you say other things they already have Ingrained in their mind that They think like you think, and therefore if you believe this thing, they they're more likely to believe that thing too. This is how to resolve a debate or an argument, by the way. the better way to argue and you see really uh smooth people like Gav Gavin Newsom does this on his podcast, maybe a little bit too slick, but he's clearly very good at it, is he'll have somebody who totally disagree with h with him on a bunch of things. And he'll Always make sure to start or with agreeing with them on something. Even if it's trivial, I agree with you that that thing was totally insane. And Now we can have a productive conversation because we've established that it's even possible for you and me to see things the same way as opposed to your knee-ject assumption that it wouldn't be possible. I wonder if that's why someone is almost never disagree with you when you are like, Oh, I taste whatever in this wine they're like possibly. Or you know, like in their head they're like, No way. Like That's a completely different taste, but they they never actually come out and say no. They always sort of like bridge a little bit of a gap. And then they'll like direct you or steer you towards what they want you to notice. That's interesting. I'm a teetotaler, so I'm the Person that If I sniff a wine, I'm like I think it's wine. But but what I have noticed, which is related to this, is do you ever see online When People are insulting someone or dunking on someone, but then that person shows up And says. Thanks for your feedback. The original person who was insulting them or dunking on them almost immediately folds like a cheap suit. Have you seen this? Yeah. Almost immediately they fold, Hey man, thank you. No, totally understand. I would be doing the same thing. I got you. Like what What just happened? And it's because once you're actually confronted by a person instead of just like a concept Or some kind of nebulous idea of a person or or some representation of a person. Like once the person is there talking to you, even if it's online. We behave in a completely Different way. And so one of the things I tell founders to do is just to show up and defend yourself. Or defend your people, defend your companies. Sam Altman is really good at this. He defends his employees. And it's very hard, even a as much as with any public figure people like to dunk and hate and insult and When hійшо up A lot of the time you see the person immediately fold. 'Cause they're just like flattered or they don't want to fight with him directly or something. It's one of the most powerful things is just to put a human in their way. I've very high cringe pain tolerance, whatever you want to call it. I have no issue with that whatsoever. I think that there is this This gets easier also with age I find. The older I get, the less I really I really care about that stuff. But yeah, I think most people are not willing to look stupid for a period of time. I think the other thing is that I think about this all from the the concept of like Entrepreneurship. I in my office, uh here here in Montreal, the Shopify office, I have the original screen print uh that Ben Francis used to create Jim Shark. It was a gift. It's a super meaningful gift that he gave me. I love it. I have a Hung up my office. Part of the reason why it's up there is because I think that It's an amazing gift and Jim Shark is this home grown success story on Shopify. It exemplifies everything we stand for. It's incredible. But the other reason I have it up there is because what most people don't know is that that was not Than Francis's first company. That Ben Francis actually had a bunch of failed companies before he landed on Gym Shark. And I think about this idea of this cost of failure, not just from entrepreneurship perspective, but in general. You have to basically figure out With any anything you're doing, what is the cost of failure here? If the cost of failure is really high, you really have to think about it. It's You have to sort of do a little bit of like the math of is the cost of s is is the benefit of success worth the cost of failure? And some ways it's just not. But I mean for thirty nine dollars a month you can build a store and it's not a pitch for shop flight, but thirty nine dollars you can build a store. If it works, blow it up. If it doesn't work, try something else. S there are still too many people that are apprehensive that that that don't want to put themselves out there because of this fear of failure. And I've long believed that You know. getting really, really comfortable with being uncomfortable. is magic. It's totally magic. And I wasn't always good at that. I don't think you can be born with that. I think you can learn that. I think you you can learn resilience. But I don't I don't know anyone I admire who's had success. who has not gone through that period of Making kinda look looking kinda dumb. I don't know if you watch the first interview you've ever done. Me? Oh God, yeah. I wouldn't listen to the first I think like twenty or thirty of them. I wanted to get a a catalog and then I wanted to listen to them. Sure. And then I I went for like a really long run and I started listening to them and I was like oh my God. And it's like I should have asked this follow up and why did I phrase it that way? And uh like you, I'm incredibly hard on myself. Came back, went through every transcript and like I was like I want to get better at this for everybody else, but Yeah. There is no secret. been so successful in my in my view. I've known you now for a number of years. You you simply k out care other people. And I think that out carrying thing supers IQ EQ Raw talent. Double click on that for a second. I think that I will take someone. It's the reason why I like entrepreneurs so much that I think entrepreneurs the right entrepreneurs, the best entrepreneurs, they just simply out care other people. They are willing to, if you put two people in a room um one person has fifty percent capacity, another person hundred percent capacity, but that hundred percent capacity person is just not caring as much as fifty percent. I think I can help that fifty percent person Get more skill. I'm not sure I can change their level of ambition. I think you can change ambition, but I think like sheer Innate. Deep rooted ambition. Uh which Call it Kerrick, whatever whatever nomenclature you want to use. I think that is a superpower. And it's also the reason why when I meet someone they say, What do you think? I should do with my life. I often ask them what do you do for fun? Because often the what you do for fun question ends up Turning into I really want to be a fashion designer. And I'm like, you should go be a fashion designer. They've ever done it. You may not have The raw skills you will learn those skills, but You seem to really care about this thing. you're probably gonna be good at it. Is there a difference between who cares the most and who wants it more? Or the like how do you see that new one? In my view. Um Usually high care comes from high intent. High Uh uh. an elevated level of desire to succeed. I'm trying to teach my kids that right now. I I spent a lot of you know This is kinda weird, but I kinda wish I had kids pre IPO rather than post IPO. Why. I think Whatever success that I've had and success of of of the things I've been involved with. They're more meaningful to me because obviously I know where I come from, I know how hard it was. But I also see how Lindsay, how my wife sees my relationship with things that I've done, in particular with Shopify. Lindsay has Great. And a g a wonderful emotional connection. It's Shopify for Lindsey, even my wife, is not just a company. She remembers You know, those early days. She remembers those Like being on top of Tucker's marketplace and the Bywood market, uh, the office stunk like the buffet restaurant and and struggling. This is pre IP pre- Series A even and and I I like that sh I love that she knows that. She knows how meaningful is because she she's seen the entire journey. Um My my kids were born in the last Eight years or so. They kinda only know Mm our life Being pretty good. Post IPO. I don't think that's a secret. financially my my life changed and and And I don't take it for granted. But. I kinda wish they knew what Lindsay and my first apartment looked like in Ottawa, Canada. And how gross it was. It wasn't gross because it was dirty, it was just was a nice bar, but'cause we couldn't afford anything else. And so What I often what Lindsay often tells me is just like Yeah, the kids didn't see that, but But tell them those stories. And so I do I tell those kids. I tell my daughter's the stories of those early days and how scary it was. And we didn't know if it was going to succeed or not. And and I want them to see that I think I don't want them to think any of this came simply because it was fate or just kinda happened, or, you know, uh I mean luck plays a role here, but This was Sheer. Grits. and willpower and it still is. Um Part of the reason why I like starting these Small project like Big Shot or Firebelly is I I I want the kids to see that. I want the kids to see this thing that You know, that first episode of Big Shot we did. was it was Charles Brothman. It didn't do very well. I wasn't very good at it. I wasn't a good interviewer. I didn't know what questions to ask. Dave and I were kind of awkward fumbling along together. And Bailey, my eldest, has sort of memorized most of the episode. And now she watches that. She she they love watching Big Shot. They also watched the most recent episode, Bobby Kodak, who built Activision Blizzard. We put that out last week. And uh And I love watching her see the difference in style and And the articulation. because I want her to know that like all the things she wants in her life, she can have. But it won't be easy. No one's gonna give it to her. And it's gonna kinda suck at the beginning. Whenever you're in that moment when you're nervous and you really want something, obviously The best Performance comes when you have freedom. But It's easy to get attached to that because you're like thinking, Okay, this is really important and so get attached to it and have tension. So what you can do is ask yourself, what do I want more in this moment? To be successful right here this one time. Or To get better at these moments. In other words, to master my ego, to not be so caught up in what people think. So what happens to most people is that they come to these points in their lives. where they're really uncomfortable. Maybe they're giving a speech or playing ping pong in from a a bunch of people. It doesn't matter what it is. You if you're nervous and other people are watching. they come to those moments where they're really uncomfortable and they back away. Because they're too uncomfortable. They're too afraid of of looking foolish in front of others. Whereas the most successful people, they're willing to look foolish. They're willing to make mistakes. And so I think a lot of people know that, but how do we get there? And so in that moment, it's ask it's realizing that when I'm the most uncomfortable, that's the moment that's the key for you. And it's it's principle number one for inter excellence. Everything is here to teach me and help me. It's all working for my good. So we're gonna go look for those moments when you're most uncomfortable. And and say and remind yourself this is my teacher. And inter excellence is about expanding what you believe is possible. There's three pillars of inter excellence, belief, freedom, and focus. To be fully engaged in the moment, have freedom to play like a child and and expand what you believe is possible. To do things you've never done and become someone you've never been. And To expand what you believe is possible, kinda that crucial Pillar is we need to Find those moments where we're uncomfortable. And we need to embrace that moment. And the way we do it is we understand that the key thing here is not the outcome. But it's my willingness to be in this moment and not back away. It doesn't matter if you fail horribly. You do that ten times and fail horribly ten times. Eventually you're gonna get comfortable in those moments. And then your skills will be able to Match and and break through. But people don't break through because they come to those moments and they shy away. I mean, this is we've all done it. I've done it way too many times. What do you struggle with? Today. I in relation to that. Anything? Well, it's the same thing everyone struggles with. When I come to those moments, I'm like, Oh, I'm so uncomfortable right now. And then I've sometimes I've forgotten. It's like I had this conversation with my spiritual mentor, um, Nick Osborne, and he said, What God does is he gives you a jacket that's two sizes too big and That's what a loving parent does when you're four or five years old. You don't buy them a a jacket that's perfectly fit because they're gonna grow out of it too fast. So they're gonna the parents gonna buy'em a jacket that's a little bit too big, right? So they can grow into it. And he said, That's what God does. He gives me this jacket that's too big. And then you put it on, you're like, Whoa, this is not good. This is not right, it doesn't feel right. What's happening and that's what I felt so much. It's like okay, this is not oh okay, what's happening? I don't I don't get it. This is uncomfortable. But God did that intentionally. He's doing that intensely. Because that's where you need to self reliance is the biggest problem that I face. And because I've got very little power. I've got very little ability. I've own I've only seen the world through this little lens that I've I wanna be able to see all of reality. And so To do that, I need to surrender my little power. Is part of this reframing failure. And to There's no such thing as failure. It's just it's not a verdict. It's like data. Yeah, redefining success and failure for sure. Like the Hall of Fame linebacker Brian Erlacher told me that. I asked him, What is the difference between you and the best performers that you've ever in NFL that you've ever competed against? And and he said most NFL players They make a mistake and they get tentative. Mm-hmm. I make a mistake. And I don't know it. And so that's that's that courage, that's that willingness to fail. That's that relentlessness that's needed. So that's what happens. I I mean it happens with people too. Like if you give a talk at work and You know, it doesn't go quite right. It's in your head the next time you do it. So you're less likely to be successful in a way, but the counterbalance to that would be, okay, well what do we do? We do more preparation, we You know, we go through our mistake, we reflect on it, we learn from it, and then we sort of like let go of it and move on. So we don't make the same mistake again. So failure, that's all um obviously big part of it. And you know, and there's one of the principles, the presupposition is there's no uh failure only feedback. It's the emotional part is the is the Yeah, If there's no emotional aspect to it then then You know, what does it matter if you fail?