#358 I had dinner with John Mackey, Founder of Whole Foods

0:00 To make this episode, I got to spend about seven hours with John Mackie over two days. And I read his great autobiography twice. And it was during one of our conversations that John told me One of the craziest things anyone has ever said about the podcast. He had listened to

0:17 Over a hundred episodes before we met. And he told me that if founders existed When he was younger Whole Foods would still be an independent company. That since the podcast and all of history's greatest entrepreneurs constantly emphasize

0:31 The importance of controlling expenses. he would have put more of a priority on it, especially during good times. During boom times. It's very natural for a company. And I think for humans in general, I think this is part of our nature.

0:43 To not watch our costs as closely. Because everything is going so well. In fact, this is something that Andrew Carnegie talked about a lot. In one of his biographies, it says Andrew Carnegie would repeat the mantra

0:55 Time and time again. Profits and prices were cyclical. Subject to any number of transient forces of the marketplace. Costs, however. Could be strictly controlled.

1:07 And in Carnegie's view, any savings achieved in costs were permanent. Andrew Carnegie's idea, it was something I was talking about with my friend Eric, who's the co-founder and CEO of Ramp. Ramp is now a partner. of this podcast and a sponsor of this episode. I've gotten to know all the co founders of Ramp and have spent a ton of time with them over the last year or two.

1:26 They all listen to the podcast and they've all picked up on the fact that the main theme from the history of entrepreneurship is on the importance of watching your costs and controlling your spend. And how doing so Gives you a massive Competitive.

1:38 advantage. That is the main theme for Ramp. That is the reason That ramp exists. The reason Ramp exists is to give you everything you need. to control your spend. Ramp gives you everything you need. To control

1:51 Your costs. Those last two words cost control. Gonna pull another line out of Andrew Carnegie's biography. Cost control became nearly an obsession. in this episode that you're about to hear, there is a shocking idea that John Mackie told me about.

2:04 about the role that Walmart played in whole food's success. And it has to do With how impossible it was For other people to compete with Sam Walton. and Walmart. And I'll give you a little hint. This is what Sam said

2:17 In his autobiography. Our money was made by controlling expenses. You can make a lot of different mistakes and still recover if you run an efficient operation. Or you can be brilliant and still go out of business if you're too inefficient. Ramp helps you run. an efficient organization. Ramp is everything you need to control spend.

2:35 And optimize finance operations all on a single platform. Make history's greatest entrepreneurs proud by going to ramp.com to learn how they can help your business. control cost. That is ramp.com. Also leave a link down below. I hope you enjoy this episode. I put a lot

2:51 of time, energy, and love into making it. And I'm very thankful to John for John Mackie or to John Mackie. For sharing so much. Of his story. I truly believe When entrepreneurs do that, it is an act of service for the next generation.

3:04 Enjoy the episode. By the end of the first trading afternoon, Whole Foods Market was valued at a hundred million dollars. Even though my shares had been diluted over the years. My own net worth was now over seven million dollars. I was rich.

3:19 How Did that happen? It seemed to me. Like a crazy amount. It was exciting, even shocking.

3:27 To suddenly be worth so much after so many years of having no money. That evening after the markets closed, I slowly drove home. Still in something of an altered state. I opened my first beer in several weeks. And sit to slowly on the porch.

3:42 Breathing in A sense of gratitude and wonder. For how far we had come. I thought back to that little Victorian house. Where Safer Way that was the original name of the business that tur eventually turns into Whole Foods.

3:56 I thought back to that little Victorian house. Where safer way had begun. And the modest dreams of success. that Renee and I had shared as we woke up each morning on the top floor. Took our show in the dishwasher.

4:09 And converted our bedroom. to its daytime form. As the store's office. I thought about Craig and Mark. Taking the leap of faith to merge with us.

4:20 And build an entirely new store. Bigger than any natural food store in the state. I thought about the hundred year flood. In our near death experience. I called my father just to hear the pride in his voice and

4:33 And to share our mutual excitement. At the success of the company. He'd so wisely helped me build. I thought about my mother. And wondered if she might finally be proud of her son.

4:45 I thought about the many people who were celebrating tonight. Enjoying their well deserved reward. For their belief. In those crazy hippies. And there's strange new notions about how to eat.

4:57 All of those expectations, all of that collective hope for our future. I had carried for fourteen years. Now I felt it lifting from my shoulders. I knew there would be new burdens to shoulder as we began our life as a public company.

5:12 But just for a moment. I set down my beer. Close my eyes. And let the joy and relief Overwhelm me.

5:21 That was an excerpt from the book that we talked about today, which is the whole story Adventures in Love, Life and Capitalism And is written by John Mackie, founder and former CEO of Whole Foods. So a few months ago I received a very nice email from John. I didn't even know this, but he was a big fan of the podcast. And he'd listen to Well over a hundred episodes, and he offered

5:41 He asked if I wanted a an advanced copy of his new autobiography. And so after reading the book, which I love so much, I emailed him and we decided to meet. So I actually spent seven about seven hours With John and his friend David. Over two days we had dinner for about three hours. And then the next day I actually went to John's new company and toured it. It's called Love Life and spent about three to four hours with John again. And so what I'm gonna do is combine the notes and highlights I have from reading John's autobiography twice.

6:11 With The notes that I took spend so much time with him. And before we get into his life story, I think there's two really important things to understand. about him. Number one, he loves entrepreneurs. And number two, he is very hard to classify. So

6:25 I love this part and I actually took notes on it. Before I met him. And then it was obvious just spending uh time in person with them. And he this is what he says about his love for f his fellow entrepreneurs. That's definitely how he classifies himself.

6:38 When I meet other entrepreneurs, there's always a spark, an instantaneous recognition that we're wired the same way. I can sit down with a young entrepreneur who's just launched Their first startup or an older one with a series of successful exits. A fellow grocery store founder or the creator of a tech company, and I just know They were gonna find acres of common ground.

6:58 And that was definitely my experience with Sean. The we had a three hour dinner that went by. I could not I was shocked when I looked at the time when dinner was over. There was, as he said, acres of common ground. And the reason I wanted to start with that quote because I really feel Not only what John did with his autobiography, but I think every entrepreneurial aut autobiography that I've read. I really do feel is it's an active service to the next generation of entrepreneurs, especially how open they are with their warnings or their explanations, or even just sharing the the dark side and the the the downsides of entrepreneurship. And then the second and final thing I just want to go over before we jump into his early life.

7:32 Is this this this Diff very difficult. You just can't put him in a box. He's very hard to classify. It's hard for people to fit me into their narrow political and ideological boxes. I sold natural foods.

7:47 I practice meditation. I espoused veganism. And I wore hiking shorts to work. I believe business Should be informed by love.

7:55 Serve a higher purpose and benefit all stakeholders. And yet I pushed back against compulsive union. I defended capitalism and free markets. I argued for freedom. Of thought and personal responsibility, I resisted anything.

8:11 That result in In more governmental controls and subsidies and moved us away from the natural discipline and innovation of free markets. Towards the saltifying inefficiencies. Of socialism. People had thought I was in one tribal box, and now they were determined to put me into a different one, which I also didn't fit into. And another trait I would add to this, or I guess another few traits that I would add to this is spend you it's obvious if you read the book and also spend time with them.

8:36 He is also extremely extremely competitive and a main theme that'll reoccur as he's building Whole Foods at the very beginning. Is this idea where you know most of the people, as you can imagine, that most of the people that have chosen to build and create natural food stores. Most of his peer group, most of his friends, they were, you know, socialists. He is undeniably and unequivocally and unapologetically

9:02 Capitalist. In fact, he said he thought he thinks that capitalism is the greatest thing that humanity has ever done. Okay, so the book starts and he's talking about the fact that he is A shirtless Long haired

9:15 Hitchhiking hippie. He's in Austin, Texas. He's twenty two years old. And he's just going, he's having this existential angst about what am I doing with my life. And so let's pick it up right from the book. I had recently dropped out of school.

9:30 Again. My college years By a series of starts and stops. Multiple transfers between universities.

9:38 And impromptu breaks to hitchhike around the country. It's funny. Uh Now that I'm thinking about it. There's multiple times and I don't know if I'll cover it later in the book, so I'm gonna tell you now in case I forget. But even after he's running whole foods, he's trying to expand. They don't have a you know, they're very capital constrained at the very beginning until they IPO.

9:57 Um and so he's trying to expand into other markets. And he wants to go scout locations for other Ventual Whole Foods in other areas of Texas. And the way he gets there is Do hitchhiking.

10:09 I just love that thought of a young founder. It's like hey, I'll do whatever I have to do. I guess it is a form of resourcefulness, right? Alright, so he says uh Impromptu breaks uh to hit track around the country, but this time I thought I may be done for good, meaning not never going back to college. This is gonna be a main Something we also talked about is the fact that Uh he he's the two most important relationships that he he ever had in his entire life.

10:30 was the relationship that he has with his wife. They've been married uh for thirty four years or thereabouts. And Then the relationship with his dad. He says the relationship with his dad is the second most important relationship. that he had in his life. His dad's a major character in this book a major influence on building

10:47 Uh, whole foods. In fact, I asked John about that. Uh when we had dinner. He says he still thinks about his dad every day, even though his dad's But there's a devastating story later in the book where his entire His mom dies disappointed in her son. She did not want him to be a college dropout. She didn't want him to be a grocer. She you know, either one of the last conversations they have is the fact that please

11:10 Stop this ridiculous whole foods. you know, business journey and go back and and get a respectable job. And You know, John's a he's a he's a troublemaker. He's a misfit. He's a rebel. It's very obvious that he's got the same personality type That you and I have. So

11:27 He says, by this time I thought I might be done for good. The academic life with its prescribed programs and predictable outcomes just felt too constraining to me. I was no longer willing to read books someone else decided I should read. That life Was not for me. Now my only curriculum was my own curiosity. And the university library was my classroom. He dr just like Steve Jobs.

11:49 drops out of school and then just drops in the classes. Not for credits, not for a degree, but because of his own curiosity, the key to do great work. I I always quote the my f one of my favorite ep essays. Paul Graham's essay How to Do Great Work. He says if this whole thing boils down to one word, curiosity, your own curiosity. And so this is something that uh me and John talked about and I think we really bonded over is the fact that

12:13 We both don't think you should read books. Be forced to read books that you hate. And the note I jotted down after our dinner was doesn't think you should read books you hate. Rebelled in college because other people were choosing what he should read. Typical entrepreneurial behavior. I want to choose what I do.

12:28 And so fast forward to now, John's in his seventies. He's read thousands of books. His MO the entire time throughout this entire book. If he gets curious about something, he needs to learn about something, he'll just devour entire shelves. But if you put'em on a d at a desk and you tell you a professor or teacher says You have to read this, even if you don't like it, he's gonna rebel. And he talks about this. I wasn't trying to be a rebel.

12:49 It's just that I couldn't conform, not to the conventional track. Not to my parents' hopes and expectations. На то the path my friends were taking. I was getting older and I understood from the concern questions of my friends and family that I was supposed to be getting serious about my future. So this is some of the Some of the things he would hear over and over again.

13:06 John, what are you gonna do with your life? John, when are you gonna finish school? John, what kind of future do you think you'll get you'll find in this library? John, when you gonna get a haircut? That's hilarious. I didn't have good answers to any of those questions. I had stepped off the marked path on which everyone I knew was still marching forward. One friend was becoming a lawyer, another was going to medical school. In my mind's eye, I could see their future.

13:28 Status. Security. Income. I knew the beats to that tune. I just couldn't move my feet to it. I wanted something different.

13:37 Something real. Something adventurous. But I didn't quite know what that was yet. And even more disturbing I didn't have people around me. Who shared that feeling.

13:47 I felt misplaced. caught between a life I couldn't live And a life I couldn't yet see. So this is the nineteen seventies in Austin, Texas.

13:59 He's definitely hippie, so he winds up living he finds out from a friend, he winds up living in this co op kind of like a I would guess a a commune. Everybody lives in the same house, they share everything. And it's called the Prana House. And the Prana House, to live in the Prana House, you have to be a vegetarian. And while living in the Prana house, he also meets

14:18 This woman named Renee. Renee is going to be his girlfriend for many years. She's also a co-founder of what turns into Whole Foods. So one of the responsibilities and the jobs that That John has uh as a member of Prawn House is he actually is the food buyer for the entire community. And he also gets a job. At this place called the Good Found, which is a chain, a very small chain. There's five

14:40 Small Vegetarian natural food stores. And so as a byproduct of working there, he re he realizes to himself, he's like, Wait, I could do this. I could run a natural food store. And then something happens that's really important that changes the trajectory of his life is that Renee believed in his idea. So he goes and and tells her, he's like, Hey

14:57 Why don't we start our own natural food store? And she didn't laugh, she didn't think it was ridiculous, she didn't tell him stop doing that. She says that sounds fantastic. Let's do it. And almost fifty years later in the future, right? He's looking back at this time, he's writing these words almost fifty years after they happen.

15:13 And he says that those three words let's do it. Were some of the most important moments in his life. And what he's gonna describe here in the book is this idea that reappears over and over again at the beginning of something, and new ideas are fragile and they that they new ideas need friends. I am forever in her debt for the way she responded when I first gave voice to my dream. I was inspired and excited. But also full of hesitation and self doubt.

15:35 If she'd been cautious or dismissive, I might never have entertained the idea again. And so I was able to talk to John about this at dinner, and he just said he's like I had a drive. To create something, to build something, to make A mark. It was an inner drive. Nobody was telling him that he should do that, in fact.

15:54 In many cases, as you know. Most people around you tell you not to do that. Don't be different. Take the safer route. G just get a job. Don't be this weird entrepreneurial rebel. But that inner voice will not be silenced by anything else but action. And so even though he's only twenty three years old at the time, he's never run a business.

16:11 He takes this very seriously. This is a this was a mission to him. He says, I took it seriously. I really did believe that the foods And supplements we'd be selling. would offer our customers a better chance of staying safe and healthy. Passion.

16:25 was calling us and it was demanding every bit of energy that we had to give. I just recently re read my highlights from the autobiography. Of the founder of Four Seasons, Izzy Sharp. And it's funny, this is also something that

16:41 John does. Me and John talked about this at dinner, the fact that he re reads highlights of books after he reads them. And this idea is very obvious when you get to this chapter in John's life. He feels that work is play. he had a passion about it, but he was deadly serious about doing his best and doing his best for himself. For his own standards, but also is best for his customers.

17:03 And I think this idea can be applied to whether you're building McDonalds. one of the world's greatest collections of high end luxury hotels, and that's exactly what Izzy Sharp

17:15 Said. in his autobiography he was talking about the fact that he really felt that one of the differentiated aspects of four seasons was gonna be their complete dedication to service. And so he was talking he would tell his people, Hey, we need to pay attention to what McDonalds does. And people on his team thought it was crazy and is he was explaining this. He goes, To compete, we would have to feel about service the way Ray Croc, head of McDonald's,

17:37 felt about hamburgers explaining why his company led competitors around the world. Crock had said We take the hamburger More seriously than they do. Changing the way that people eat.

17:50 Is an idea that John Mackie took more seriously than anybody else's entire industry. So to start the first store, which is called Safer Way at the time. This is no Whole Foods yet. This will turn into Whole Foods in a little bit. He raises f he has this idea, he's like, I wanna raise forty five thousand dollars from friends and family. Another thing you have to know about John is uh he describes himself as an evangelical Or um an evangelist rather, not evangelical.

18:12 He's a evangelist and can be very charismatic and convincing. And so one of the wonderful byproducts of him beginning this entrepreneurial journey is the fact it's gonna eventually, the business of Whole Foods is actually going to bring him and his father together because he was very, very different. He just grew up completely different from both of his parents. So I want to give you a little background there to'cause I think it'll enhance your understanding of the story. My father had grown up during the Great Depression, and when Pearl Harbor was bombed by the Japanese in nineteen forty one, he was just twenty years old.

18:40 He wasted no time joining the military. And marrying my mom. His generation had to grow up fast. They had no time to indulge Youthful dreams or ponder the meaning of life. They had to rebuild a country devastated by the depression and war.

18:56 He had not my father had not followed his own passions in life. That simply wasn't what people did in that era. And it was hard for my mom to get on board with my life choices. She s couldn't get over the fact that I dropped out of college. She never.

19:12 That I'd wake up from my strange Impractical obsession With being a grocer. And she wanted me to go back to school. And so his mom doesn't like the fact that he's doing this now. She never likes it, but his

19:25 It changes a relationship. That His father has with them. Listen to this. In my father's eyes, however, I'd shifted from being an aimless hippie dropout. To a youthful entrepreneur with conviction and energy.

19:37 For the first time in my adult life, my father's life skills and my own passions seemed to come into alignment. He was an astute businessman. He taught accounting at Rice University. And then became the very successful CO of a health care company. And so his dad is going to play a large role in guiding his son. And trying to help him build a business.

19:54 There is a Benefit. To this like youthful naivety that a lot of entrepreneurs have when they start, they don't know how difficult it's going to be. And John hates bureaucrats.

20:04 It is something that pops up over and over again in the book. But even at the beginning, this external bureaucracy, the city inspectors almost kill the idea before it's even born. So even back in the nineteen seventies in Austin, there's all these per he doesn't know all the building permits and all the inspections that you need to do. And so they would drop in and be like, What are you guys doing? You don't have the right permit, you can't do this. They would essentially say, Shut this down. You know, you're gonna have to wait months and months until we go through everything and improve everything. And his whole point was like we don't we can't wait that long. We don't have any money. You're we're the business is gonna die before it's born.

20:38 And he calls this impending death by bureaucracy. And so he is advised on a way around this problem. From an older, wiser entrepreneur. The the his landlord is in his seventies. Remember, John's I think twenty four at this time. And you know, he's just saying, I don't know what we're gonna do. We are going to run out of money before they let us open.

20:57 They're not letting us build out the store. And he's like, Well what time do the city inspectors work? What do you mean? It's like city inspectors work during the day. They leave for work no later than five PM. And they sleep at night. And so he points his finger.

21:10 At John's chess. He says then that means you build The store At night. And John points out like you know, the normal people that are not entrepreneurs

21:19 might be aghast at you know doing something like this and he and he says any entrepreneur knows that regulatory structures often do not match the on the ground real realities. And they tend to favor well capitalized Established institutions over innovators and newcomers. And so slowly but surely He obtained all the permits and everything that he needed.

21:39 But he did the work first. He asked for forgiveness, not permission. And if he didn't do this, Whole Foods would never exist because they had no money. They had they they're living in the store. So the first store is this Victorian three store Victorian house. Okay, so the first level is gonna be the whole foods natural Or the natural foods market.

21:56 Uh the second is this cafe. And the third is the office which they have to sleep in. This is what I mentioned at the beginning. They're sleeping in the office and they're taking showers. Using the water from the dishwasher. And so eventually he's realizing he's like, Hey, I need help. And he has great writing here. He says we had built our business on a dream fueled by ambition, desire, enthusiasm, a sense of adventure.

22:17 Hard work. And a lot of help from our friends, but to be truly successful It was going to take something more. We needed business experience and intelligence, I knew where to turn, and then he what does he turn? He turns to his father. And so his dad helps him build his own personal curriculum.

22:33 And this is reading and re reading this is professional research. So he gives him some Peter Drucker books. says my dad also gave me Alfred Sloane's memoir about his years with General Motors. So there's a a quote in poor Charlie's Dominic that says there's ideas worth billions in a thirty dollar history book.

22:50 That is literally true with Alfred Sloan's memoirs. This was the most popular book. maybe half a century ago, maybe f forty years ago, something like that, with all the top founders and CEOs I I've come across this in America. We're reading Alfred Sloan's book. One of those.

23:05 was Henry Singleton of Teledyne. Who I found out because Charlie Munger said he that ha Henry Singleton was the smartest person he ever met. And Warren Buffett said the fact that business schools don't study singleton is a crime. But anyways. Henry Singleton talks about reading Alfred Sloan's book and taking an idea from there, and it helped that w single idea helped him build Teledyne. So now we have

23:27 John's dad giving him that same book. And so John says, could a car manufacturer really teach me anything about running a natural food store? And regardless of his skepticism, he's gonna read. This this is John's MO. He just does he does he'd He's still doing this to this day. He's just a voracious reader, voracious consumer of information.

23:45 She says I filled my backpack until it could carry no more books. added more titles from the local library and bookstores. If it had anything to say about business, I read it. In fact, I devoured it. And I learned by night. I read about business. By day I worked in the store.

23:59 John is still doing this. This is why he's going through over a hundred episodes of Founders. In fact Me and him talked about He he he comp John completely gets it. He's like the amount of books I have found because of your podcast. We and him talked about the books that he read that he didn't know existed until he listened to the podcast first and then read the books. That's exactly

24:18 How you should be using founters. By day you're working on your business. By night you're obviously listening to the hopeful listening to the podcast and reading the books. And and I learned by night I read about business. By day I worked at the store. Every few days I'd call my father and talk to him about well about what I was reading. I began to see the challenges our small business was facing. From a more holistic perspective. I now understood the competitive disadvantage in the marketplace that we were working against. That were working against us and giving our rivals a better chance of success. He gives us an example.

24:45 Take my former employer, the Good Food Company. They only had five stores. Right? But it's bigger than his one. And that gives them an advantage. Take my former employer. They had five stores compared to our one little store, and as a result

24:57 They were able to negotiate better prices. than we were from the wholesalers and therefore price their products more competitively While still making a profit. That gave me the idea. What if we teamed up with other small stores and pulled our buying.

25:11 The importance of relationships and secret allies. Secret allies is this idea I got from this Very obscure. Rockefeller biography. It's still the best biography. Rockefeller I've ever read. In fact I found it because The second time I read Titan, which is the biography every on Rockefeller everybody knows.

25:27 I go through the bibliographies of all the books I read and I find a ton of other books. And I found that book in there. I think the book is written forty, fifty years ago. Biography of Rockefeller talks about Rockefeller's idea of secret allies, of making secret allies With other entrepreneurs and business owners in the early oil industry. John is going to do exactly that in the natural food industry.

25:49 It's one of my favorite parts of this entire book. He learns from his relationships and he winds up buying this entire network. It's insane. It's one of my favorite parts of the book. We'll get there. So what he does is he has all these other people, he goes and builds goes and seeks out and builds relationships With people in this industry. They're technically competitors and he's like, Why don't we turn into allies?

26:07 And so he approaches two guys that are running another natural grocery store. These these guys, Mark and Craig, are going to wind up being co founders. They're the third and fourth co founders of what eventually be Whole Foods. And he pitches this idea is like, hey, we're separate companies, let's act as one and we buy from wholesalers as one unit. That way we get better prices. And so he says technically they were competitors, but once we created the distribution company, we became allies. And so John starts building this relationship. We had long conversations about our stores, about the products we were selling, about retailing.

26:37 And about business in general. Rockefeller did this exact same thing. Yeah. And Rock and dominating his network just like John's gonna wind up dominating his. I I guess I should go back before I move on.

26:48 That the the The biography that I reference is episode two fifty four, the name of the book, which I believe to be the best Rockefeller biography I've read so far. It's called John D. The Founding Fathers of the Rockefellers. I'll eventually reread that that's a book I should probably read every like, you know, two or three years. I think it's excellent. But this idea that both Rockefeller And

27:07 John Mackie shares this idea is like, hey, we're gonna build a relationship with everybody in the industry. We're gonna kinda map out. They're essentially like building a map of their industry. They're both in the at the very early stages. Rockefeller in the early stage of the oil industry. John Mackie is the the very early stage of the natural food industry. And it's important to know all these ideas are related to each other. Think about it. He he realizes all about a giant competitive advantage. Disadvantage rather, because he's doing all this reading.

27:32 Then he realized okay, how do I if Solve this problem. Then he realized, Oh, I should build relationships with the peers and competitors, and some of them are going to turn to allies and he's going to acquire a bunch of these companies in my industry. And then he continues to get ideas because it's all tied to this fact that he's a voracious reader and a voracious learner. So he gets an idea from an industry trade journal that actually helps him expand his mission.

27:54 So there was a trade magazine called Natural Food Merchandiser, and he reads this story About a company. Ін Лос Анджелес It's a natural food store named Mrs. Gooch's. I won't bury the lead. All these people he's about to name, he's gonna build a network with them?

28:09 He winds up acquiring almost every single one. He was there was not another John Mackie in his industry. There was only one. He was much more ambitious and organized and then He was just a conqueror. He had the conqueror spirit. It's funny, as I was reading the book the first time I also gave out a a a copy to a friend of mine. And he read the book and loved it as well. And I was like, How

28:31 How many times am I gonna have to learn How how am I still making the same mistake over and over again? And so we were having this conversation. It's just like This guy gets involved at the very beginning of his industry, right? He then he's going to build the company That is the industry leader almost like categorically define the category he operates in.

28:50 Why was I surprised Going into the book And then My surprise is obviously alleviated by the end of the book. Why was a surprise that of course he was a conqueror? Every single person that's going to start at an indust at at the beginning of an industry and then build

29:05 the category, the industry dividing companies the same way. They all have this ruthless competitive drive that is not matched by their other peers in the industry. So back to where we are in the story. He's reading this industry trade journal, this industry magazine. And he hears about Mrs. Gooch m Mrs. Gooch's, which she's eventually going to to acquire many years in the future. And he says I read the story so many times

29:28 That the pages were tattered. And so this is what he learned from the story. Unlike most natural food stores at the time, it sold meat. And so when he first started Safer Way, he wasn't selling meat. It was all vegetarian. Unlike most natural food stores at the time, it sold meat, poultry, and seafood alongside the kind of products we sold a Safeway.

29:45 The idealist in me was proud of our strictly vegetarian ethos. But the entrepreneur in me saw a massive opportunity. Imagine if customers were able to do their entire grocery shopping for the week. Without having to set foot in a conventional supermarket. Mrs. Gooches was doing a staggering a hundred thousand dollars a week in sales.

30:07 In contrast to our eight to ten thousand dollars. A week. So he had attacked this tiny part of the market. 'Cause what's happened, you g you're gonna shop at Saferway.

30:17 But then you have to go to a normal grocery store to finish everything to round out everything else that you're gonna eat. By following Mrs. Gucci's example, he's like, Oh wait, I'm I am underperforming ten X. And because of all the experience he's gaining and all the reading he's doing, he's like I can't stay in this little s this this little tiny segment of the market. Why? Because our conclusions seemed i inescapable.

30:37 Size mattered in the retail business. And so this is when he's switching his mind. He's like, Oh, only one only one thing is on my mind now. Expansion. Is gonna echo what Jeff Bezos said in the early days of Amazon if you read his shareholders letters. Somehow Jeff n understood very early that the internet destroys the middle.

30:53 So he's like on the internet you have to be either really, really small are giant. So Amazon has to get big fast. John Mackie arrives at a similar conclusion in the natural foods market. Says the natural foods market is growing. If we don't expand now, we'll miss our shot. In two years it might be too late.

31:09 The business environment is tilted against us and we need to change that. We have to change that. Location and size matter a lot. And so what John does next is really smart. And again, it just feeds back to the fact that he's this voracious Learner, voracious reader.

31:24 And so he's like okay. I'm gonna jump out of the magazine and industry trade magazines and I'm going to actually go and fly and do these store visits, which helps obviously build relationships with the people running the store. I wanted to see for myself. Some of the new natural food stores I've been reading about in Natural Foods Merchandise. That's the trade magazine I mentioned earlier.

31:43 And meet the folks behind them. I plan a pilgrimage. So he's gonna go coast to coast. He says a pilgrimage and market research trip. Each visit gave me new ideas when it came to store layouts, displays, and Creative signage.

31:56 Product mix and more. What I gained from those visits was confidence. My vision of a larger format natural food store was not crazy. And so he takes what he's learning and he acts on it and he has this thesis. He's like, listen.

32:11 I don't think We're serving the entire market here. I think if we make as we make the store bigger The revenue will grow as well. And so he says we have to take a risk. We have to get a lease on another bigger location.

32:25 There is hilarious stories in the book. Because again, there's no You know, you want to open a Whole Foods market now, like that you're gonna have a line out the door of people that want you to put your Whole Foods you know in their commercial development. But at the time he's only operating in Texas. He's like this.

32:39 Yeah, they're more much more conservative environment. And the they he keeps having these meetings like You gonna put in this damn hippie store? They gonna keep going he's like, No, it's a natural food supermarket. He's like This is a hippie store. And so this guy actually they're gonna wind up doing a deal'cause he actually he's like, Oh, you're kinda like a younger me, just like a younger, weirder hippie version, but it's just hilarious the the conversation they're having it just made me laugh. He's like, We're opening a natural food supermarket, I said.

33:03 And Ben, the guy he's talking to, Ben stopped me. Son. You gonna build some kind of hippie food store? No, sir. It's a neutral food supermarket.

33:10 That's what I said. A hippie food store. Sperk. We're selling natural foods. He looked even more confused.

33:18 Natural food? What is a natural food? And he starts describing then it then Ben he goes he he goes he interrupted me, he goes, Son There are not enough hippies in the whole damn world. For you to sell enough groceries to make that kind of store a success. But one thing John d does have

33:34 is he he calls it his evangelical enthusiasm that you know he he considers it one of his superpowers. Especially because he believes in it. you know, he can e enthusiasm and passion is infectious. You can literally transfer the the belief that you have in what you're doing to other people if you're passionate enough. And it works on Ben. So he goes, John.

33:52 He said his slow Texas draw. I like you. You remind me of myself when I was young. So damn idealistic and optimistic. You think you could take on the world.

34:01 Life is gonna teach you a few things before it's done with you. That I can say for sure. He then paused. What the hell, son? Let's do your damn hippie food store. I love that that uh that story so much.

34:13 Uh it's this store is now ten thousand five hundred square feet, and so Again, John's thesis. is not unique in the retail industry. Again, he was discovering this independently. But this idea a larger store is gonna equal more revenue. Sam Walton discovered this as well. We just covered a few weeks ago s that that obscure Sam Walton biography.

34:31 And every time Sam Increased the square footage of a store, the revenue went up as well. And so this is the time where Whole Foods is born. He talks to the two partners that they started the distribution business with. Now he's like okay, let's not just

34:44 buy or you know, use our size to buy to get a better price from our whole uh better wholesale price. Let's actually combine the two and into one company. And so there's four co founders of Whole foods. It's gonna be Craig, Mark, and then John and John's girlfriend, Renee.

35:01 And so John convinces them to do a merger and they're like, Okay, well we need we're not gonna use Saferway and they're not gonna use their Clarksville. It's like what's the name? And they c actually came up with a name because they took it. There was an industry magazine called Whole Foods Magazine. And they're like, Why don't we just call it Whole Foods Market? And one of the best things about autobiography is like this, it talks about the fact that at the very beginning

35:22 You're n never gonna have enough money, you're never gonna have enough time, you're never gonna be ready to launch and you have to do so anyway. They just can They're not ready to launch a larger store and there's some funny things they have to do to To make it appear like they have more inventory than they actually do. But they can't afford to wait.

35:38 So What are gonna do? Like you have to go forward and you have to get creative. By the time construction was complete, we were running low on money. We simply weren't gonna be able to meet payroll unless we open right away. But we weren't ready. We didn't have or beer and wine license.

35:50 We didn't have a butcher. And we had a significant lack of inventory. With just a few days left before opening, the shelves were half empty. The solution was found in juice. Apple juice.

36:01 It was a popular product in those days. And we were able to get a hell of a deal on a full tractor trailer load. We could fill up the empty shelves with gallon jugs of apple juice. And this is hilarious. When the truck pulled up outside the store

36:13 The driver said, Hey man, where's your loading dock? Loading dock, we don't have one. All we had was a couple of dollies and a lot of people. And so they make this like one big long like human chain and unload a semi truck full of apple juice. We featured it on every open shelf and sold it.

36:31 at the special opening week price of ninety nine percent. per gallon. Customers felt like they were getting a really good deal. And it created a convincing illusion. That the store was fill to the brim. On September twentieth, nineteen eighty.

36:46 At nine AM we opened You're gonna see right from the very beginning, this is the right place. The right time. With the right person with the right set of skills. How long did it take until Whole Foods market first became profitable?

37:00 I would answer only half jokingly. Until about two o'clock in the afternoon on the first day. Our sales far exceeded expectations and they never slowed down. We became the highest volume natural food store in the United States. Doing over two hundred tausen dollars per week.

37:17 It was the right place. the right timing and the right type of store. Imagine the euphoria that you would feel if you were in John's Shoes. The amount of time, effort, energy, love and risk that you took

37:33 And it was an unbelievable success. From day one, but you know that entrepreneurs The entrepreneurial emotional roller coaster is euphoria and terror. They open up in less than a year later. Austin, Texas

37:48 Gets hit. by torrential downpours that cause what they call A once in a hundred year Flood. A hundred year flood hits them.

37:58 In their first Year of existence. The water broke through the windows like a tidal wave. Delusing the store. It was the worst flood that Austin had seen in seven decades. Тертин.

38:12 The store. A feet under water. All of our equipment and inventory would need to be replaced. We estimated the inventory alone was worth about four hundred thousand dollars.

38:23 And virtually all of it. Was financed by our suppliers. I started to feel much older. Than my twenty seven years. Before the flood, I really felt as if this was why I was on earth.

38:36 This is what I was here to do. This is what I was meant to do. But now he's saying well I can think that all I want. But then nature Delivers eight feet of water.

38:47 Nature puts my store. Eight feet of water. And it's not just that it's water when there's floods, that means the sewers overflowed. And mix with the floodwaters. And so his entire store is full of fecal matter.

39:01 So what do you do? He's got no he has no idea how he's gonna get out of this, but he's like, Okay, well what am I gonna do? I'm not gonna just sit here. So he just starts getting to work. Eventually the water's Reced. And they grab a bucket and he starts mopping. And

39:14 Here's the insane thing. And it's the uh idea that what you've made is, you know, love by other people. And he notices a guy that's doing the same thing, that's that's on another aisle of the store mopping and you know, he's like, I thought I knew everybody that worked here. So he goes, Hey, I'm sorry, uh I don't remember your name I'm John. And he goes, Hey I'm Larry. I live down the street.

39:33 I'm off work today, so I thought I'd come by and help clean up. I love this store. I shop here all the time and I want to make sure that you guys come through this. And Larry wasn't alone. As the day wore on more and more volunteers showed up, they came uninvited and unpaid. For no reason other than they love the store and didn't want to see it fail.

39:55 And this is just a first in a series of people that Help John. And lend him a hand. And if they didn't, Whole Foods probably wouldn't exist because they didn't have flood insurance. So the first thing he does, even though he's owes his suppliers a bunch of money is like, Well, you know, if we go out of business, we're not gonna be able to.

40:11 Can you front us some inventory? They agree. Then he goes down. To his local bank, City National. And he explains it to his local banker, this guy named Mark Monroe. And Mark Monroe agrees.

40:22 to give him a hundred thousand dollar loan. Now there's a crazy story. Years later When the loan was long paid off. I learned the reason that the application process had been so easy. A stranger approached me at a conference and shook my hand. John, you won't remember me, but I used to work at City National Bank. That was quite a thing that Mark Monroe did for you after that big flood.

40:41 The bank didn't approve that loan. The bank turned it down. Mark Monroe personally guaranteed that loan for you. That's the reason you got the money. I was stunned.

40:51 Mark had never said a word. Only four weeks after the flood. We reopened. And so a large part of the book was about the very beginning of Whole Foods, like figuring out and then opening new stores, constantly Revising

41:05 what they wanna build and how they're gonna build it, and then expanding into other territories we'll we'll get to, but One of the things that was very interesting that that John and I talked about At dinners he said that The years go by fast and a lot gets lost to memory. So I'm gonna come back to this because At this point in the book he's

41:22 Twenty eight years old. And this is what he says. I look back remember, he's writing these words almost half a century into the future. I look back on those days as some of the happiest of my life. I was in love with our store. There was a palpable sense.

41:36 That we were doing something new. Something important. And so when I talked to John about this, he said that years go by fast. A lot gets lost to memory. He actually thinks

41:46 They're writing a memoir. And interviewing people from your life and past is actually helpful even if you don't publish the book because He had an idea. He saw says something that's fascinating. He says The beginning of Whole Foods?

41:58 And the end of Whole Foods is like very fresh in it i in his mind. And there's a lot in the middle that you'll tend to forget. You know, a lot will get lost to memory. And so by the process of writing a memoir, you're also interviewing and doing research of people There were

42:11 that you knew back then and that could tell you their perspective on these events. But when I heard John talk about this in person and also when I read the b in in the book, I thought of something that this is the advice that Phil Knight gave to to younger entrepreneurs that he neglected to do himself because at the end of his Autobiography shoe dog, he said this. I struggle to remember. I close my eyes and think back, but so many precious moments from those nights are gone forever. That's the exact same Experience that John Mackie had.

42:39 Numberless conversations. Breathless laughing fits. Declarations, revelations. Confidences. They're all fallen into the sofa cushions of time.

42:48 I remember only that we always sat up half the night cataloging the past. mapping out the future. I remember we took turns describing What our little company was and what it might be. And what it must never be how I wish. On just one of those nights.

43:03 I had a tape recorder. Or kept a journal. And one of the most entertaining and informative parts of the book is how much co founder conflict That he has how many. There's multiple coup attempts.

43:15 But this is one of an unusual uh co you know, co founder conflict is nothing new. But an unusual one is when you're in a romantic relationship with one of your co founders. And remember, they're they're hippies by their own admission, and so John gets this idea is like we should have, you know, free love and so he

43:33 goes and talks to Renee, which is his girlfriend at the time, he's like, We should have an open relationship And the problem was this this backfired. And so There's a story in the book where he tells Renee, Okay, let's, you know, see other people, even though he was in love with her. And he comes home late, he's like, Oh, I'm working late, I'm just gonna sleep at the store.

43:50 And he said, Oh, you know But no, and then he's like, Oh, I can't get any sleep here, I'm gonna go home and as you could probably know where I'm going Goes home. And sh you know, sh his co founder and girlfriend is engaged in uh an activity that was previously reserved just for them to.

44:06 And he has this great line in here, he goes, I was heartbroken. And mad of myself. What kind of idiot tells the woman he loves to start seeing other people? And so in addition to that, he also has traditional co founder conflict and at the the the root of their problem But he has one of his co founders is

44:22 I told you before, John Mackie's a conqueror. He says I was never going to be satisfied to stay small. I was never going to be satisfied to stay small. And so there's a tension between him and his co founder, Mark. Because they open a new store. It sales go a little slower, they're cannibalizing s sales in some of their other stores.

44:40 John has a very long term patient view. And his co founder doesn't and he's like You're ruining we had a we had one great store Why can't you be satisfied? With one great store and he tells us why. I was never going to be satisfied by staying small.

44:54 And over time only one of the four co founders is going to remain, and that's gonna be John Mackie. And it is during these these conversations, these d these philosophical disagreements where he realizes oh we have a commitment mismatch. I wondered if he was truly committed to the natural food's mission. I knew he personally believed in eating healthy. But was he interested in trying to change how other people ate?

45:15 For me it was becoming A calling. Something I felt I had to do. What we were doing was more than a business. I knew it could be successful. It had to be. We just needed to get through the slow start. And start working on the next store as well.

45:29 And one of the ways that he was going to expand and to change how the rest of the country was through this thing I mentioned earlier. This is the network. This is very similar to what The secret allies idea that John D. Rockefeller had. And they're just a network of fellow entrepreneurs.

45:44 That own the country's best natural food stores. And so at this point, there is no such thing as a national chain of natural food stores. At most there'd be a chain of stores, like a handful of stores, in one geographic location. And they kinda just they never expanded outside of those boundaries. And so they were constantly traveling together and so they would all be Hey, we're all gonna meet up in Austin, we're gonna tour John's stores, or we're all gonna meet up in LA and tour this store, or we're all gonna meet up Wherever they're located in tour. He says I learned so much from these visits, coming home to Austin brimming with ideas for new product lines, marketing strategies

46:14 Management approaches, store design, and more. The network quickly felt like more than a business association. These were friends, fellow travelers. who are walking the same road that I was on. It was also allows him to drastically expand into other regions'cause he's just gonna buy up all of These people in the network.

46:29 What I could not possibly know back then was that over the course of the coming two decades. Whole foods market, the lean, hungry upstart of the bunch. would not only surpass each of those other businesses But would end up buying pretty much all of them one by one. The era of regional stores would soon come to an end.

46:46 And we would begin our journey to become a national brand. And so as you can imagine, doing this over multiple decades, and especially at the beginning when he's completely underfinance, is very stressful. And so one of the things he told me in person was that one of the things he's most proud of is all the he calls it inner work, all the inner work that he That he did to deal with, you know, all like the stress that you have, the guilt, the anger.

47:08 All these negative And somewhat, you know, it can be dehabilitating. uh emotions and like trauma that you're gonna have as you build your company. And so he the the the book talks a lot about this inner work. And so for his inner work, He believes that M D M A

47:22 And psilocybin. And then breath work was v was very instrumental to making him a better person and managing all of You know, the complicated messiness of being a human being. I did tell them. We talked about this. He he said uh You should try MDMA. I was like, John, I'm not doing MDMA.

47:40 Uh, I I just not I don't wanna do any kinda psychedelics or anything like that. Uh it's up to what I don't, you know, judge other people. If you like doing that then and it's helpful, uh by all means do it. And he definitely talks about how helpful it was in this book. But he did say. that you could do breath work. And he found that very helpful. And before I read this book I didn't even know what it was. So I'm just gonna have him define what breath work is in the book.

48:01 Breath work in broad terms is a technique involving a facilitated session of guided breathing. That puts one in an altered state of consciousness. Allowing deeper spiritual insight. In opening up a pathway toward clearing mental and emotional baggage. And John credits it with

48:16 His main thing, like he's he's got this interesting com combination of traits that some people might would feel our contradictions. And when I was in w in with talking to him in person, I realized that the two strongest ones And this is his friend David that was what this also told me. It's like love and discipline. And so he talks about like the his main theme is love. And he says

48:34 This is a result of all the inner work that he's done. Uh, love was an enormous part of what got us started on the journey together. Love fueled our creation of the store and turned it into something we could never have imagined. And love had kept it alive even through the most difficult moments. And this goes back to the importance of I think having the right But basically the the the philosophical m match for the co founders because

48:55 John goes through all this therapy and this inner work. And he comes back and he tells his co founders, he's like, Hey, I wanna aim to build the happiest workplace in America, a workplace based on love. And his co founder Mark. It's just like What the hell are you talking about? He literally says in the book, based on love, what the hell does that mean?

49:13 I knew that Mark privately referred to me as wacky Mackie. And thought that my spiritual pursuits were not just crazy, but detrimental to the business. And so as time passes, you have this growing rift in frustration between co-founders. Mark's growing frustration became an all-out war for control. over the direction of the company. The first real challenge to my leadership, the first and not last. It's amazing how many times his board or

49:36 or other people in the in the company want to kick him out. And so this is what Mark's saying. You're a terrible CEO, John. Look at what you've done. We've built this beautiful store into incredible success. And then you had to go and completely screw it up. So Obviously you you keep expanding, you're gonna lose money for a little bit like a a short amount of time. John was fine with that. John thought, you know, the expansion is is what I ha we have to do if we want to change the way

49:59 the the entire country eat. His co-founder did not agree with him. You're gonna run this company into the ground, but the new stores weren't a mistake. I was still sure. We just needed to give them time to grow into successful stores. Mark did not have that patience. To me. Our mission was much larger than one store.

50:16 And in building a bigger company, mistakes and setbacks are inevitable. This was the most painful part of the conflict. Mark and I had been really good friends. And so Mark demands to leave. John and the rest of the uh shareholders have to buy him out. He walked away with about three hundred thousand dollars.

50:33 For his ten percent of the business in nineteen eighty five, that seemed like a lot of money. But history would prove that to be a very poor financial decision on his part. And so this is just one of many examples in the book where the people around him are telling him he's wrong. Telling him he should quit, telling him he should change strategies. Just doubt, doubt, doubt. And so we talked about this in person. It's like why did you persist? And he he has a very simple answer. He says, I just had faith.

50:59 That I could figure it out. And I think it was motivated by the challenge. Like can can I actually do this? Like there's a line in the book where he says, you know, once they got to the point of being They have multiple stores. They're definitely the market leader in Texas. But He wanted to find out. Like it is Whole Foods

51:13 Is it just gonna be a Texas company? Or can we do do we actually have the potential to be And the the skill set and the talent and and the drive to actually be a national company. And I think one of the things that, you know, is obvious when you spend time with him and is by on his mission, he's like just super competitive. He says I was also acutely aware of how being an entrepreneur had channeled my own competitive instincts. I thrive on competition. And I love to excel in both sports and in business. I was driven to outdo our competitors.

51:40 To win in the marketplace. This competitive drive was critical to our success. I was amazed. And how a good idea.

51:49 And a successful store could become several turning into a real business and a real business could grow to become a large company. And that chain of success could potentially change an entire industry. And so he makes a jump and he starts expanding to California. But as he does, he goes home to visit his mom, who is in very, very poor health. And so

52:09 This is the last conversation. That they ever have. And even up until the very end, she was not proud of her son. She was only sixty four, but she looked so much older. Literally wasting way before our eyes.

52:21 John, she said. I want you to make me a promise. I want you to promise me that you'll go back to school and finally get your degree. You could be so much more in life if you would just apply yourself to it. I hate to see you wasting your life. She still didn't understand.

52:36 that I found a career that both fulfilled my soul and was bringing financial rewards as well. Mom, I'm never going back to school, I told her. I'm doing what I love, and whole foods market. is going to be a great company. I'm more than just a grocer.

52:49 I'm a successful entrepreneur. She just shook her head. I didn't know then. That this conversation would be the last one I would ever have with my mother. She died a few days later. I'll always regret.

53:02 That her last moment with me. was one of disappointment. So by this time in the history of whole foods He realizes, hey, we're gonna grow through acquisition. That was one of the most shocking things about reading the book because you know, I've been shopping at Whole Foods forever. I never thought about

53:18 the how the the company came to be. And it's just he he grew whole foods. He was very aggressive, more aggression than anybody else in his industry, and he grew Whole foods. Do acquisition, do buying up say all these different chains. Of these regional natural food stores. And so

53:33 They can't do that without capital. And one thing that's very, very obvious if you read the book is John's distaste for venture capitalists. He does not hide it at all. This is something me and him talked about as well, which I'll get to in a minute. And so this is in the eighties and so his father's having this conversation, like, We need more capital, where are we gonna get this? Uh his father was a voice of caution. He says, Make no mistake, John, you cannot trust VCs.

53:55 You may need them, but you can't trust them. They're gonna need their money back and to do that they need an extra strategy. And so him and his dad are going back and forth about the pros and cons of like do we take this money, do we not? And says, What would it mean for me as a CEO to have VCs and eventu shareholders to answer to? I liked running the company the way I did with my supportive board and a small group of patient investors. Who I'm new personally and trusted. I didn't know how I felt.

54:20 About bringing in outside investors With their own interests and agendas. And so the conclusion that he arrived at was If I'm gonna grow through acquisition and I wanna grow faster. He says there were no other viable options.

54:34 If we wanted to expand. Faster. And so he flies to California and he goes to Sand Hill Road. Where where entrepreneurs still go. Remember this in the eighties. People still do this today. Most of the VCs did not see any opportunity in front of them. If one of them down San Hill Road said

54:50 This is never going to be a very large market. Which is funny'cause when John leaves Whole Foods they do tw they're doing twenty two billion a year in sales. So they don't have any success. They go back. And they pitch some local Texas VCs. one of which is very well known and prestigious inside of Texas and this is

55:07 They were haggling over like they want to do the deal, but the valuation's a little lower, and this is what the VC tells them. John, he said, We're a top tier V C firm. Just having us on board is going to raise the valuation of the company when you want to go public. All money is not the same color. It would be some time before I understood the truth in Jerry's words. At that moment all money looked exactly the same to me.

55:29 Later I would understand how being funded by a prestigious V C firm acts like a magnet. to other V C firms the next time you need to raise money. So this is September nineteen eighty eight. Whole Foods is doing fifty million a year in sales in nineteen eighty eight, okay. They agreed to raise four point five million.

55:45 And the venture capital firm gets a total of thirty four percent of the business. And he understands that now once he takes the money, he's on the clock. And so this is how he thinks about taking venture capital. I began to think of our VC partners as hitchhikers with credit cards. They were along for the ride and benefiting from our forward progress.

56:05 And as long as they felt we were going where they wanted to go. They'd help pay for gas. But they did not have the same level of commitment To stay in the car for the entire journey. If we got lost or diverted from the road we promised to take

56:19 They might try to grab the wheel. I knew we couldn't afford to let them drive. Nor did I put it past them to hijack the car. Hire a new driver and leave me standing on the side of the road. Eventually they themselves would need to exit.

56:33 And I needed to ensure That they didn't push me out first. John has a lot more to say about VCs. And his perspective on them. in the book, which I'll get to in one second,'cause they're about to IPO. This is something we talked about

56:47 In person. Because one of the benefits of doing these, you know, I had dinner with episodes is for People that are they're so he's got Fi five decades of experience as an entrepreneur. And it's a way to

56:59 share lessons and almost like send warnings out to younger entrepreneurs that you know, don't have all the experience that John did. And so we I talked about this like listen, it's obvious. Like I r I read the book before I sat down to have dinner with you. And I talked about this when we toured his new business, which he also took funding for for. And he he makes all he he tells he explains why. And so

57:20 We had this conversation and again I didn't record any of the conversations I had with John. So every note I read you is just when I got done, I just wrote down and paraphrase the lessons that I was learning for the conversations that I was having with them. And so this is what I wrote down. Be very careful who you take money from. Short term. Portfolio approach that most investors have is at odds.

57:40 with an entrepreneur's life's work I can tell you right now, it's very obvious. When you read the book and you spend time with John. Whole foods was his life's work, he was not just doing it for money. He loved it, he still loves it to this day, even though he's not involved anymore.

57:56 And so it says John understands that capital is a service that entrepreneurs But cautions to partner with people With the same long term view you have. And so we talked about the fact that for his new venture Love Life

58:09 He took some outside money for love life, but He st he took money. From a long term friend who is an investor. But i that investor has a proven track record. Of supporting founders and being patient. John is also

58:23 funding the majority of the business himself so far out of his own pocket. So I think that added context of my time with John and also what I've been reading to you from his book. We'll give you a sense of how he b how he thinks on this subject. So They get to the point where they Raise money nineteen

58:40 eighty eight and then they have an IPO a few short l years later, nineteen ninety one. And this is his description of that. He says it was the second uh happi of his life. first happy stay was marrying his wife, Deborah. Yeah, which happened, you know, a few months before And then the initial public offering.

58:55 for Whole Foods because he says it was a relief at the thought that the hitchhikers would soon be exiting the Whole Foods car. Over the past few years I'd come to understand all too well why my father had cautioned me about VCs. Their investment had been essential. But it came at a high price. It almost cost me everything I had built. I learn the hard way.

59:13 That V Cs have strong opinions about where the car should be going and how quickly should get there. As we fell behind on some of our projections, our hitchhikers had started to exert some pressure. They kept reminding me that none of our team had actual supermarket experience.

59:29 Never mind the fact that we've been running Whole Foods Market for more than a decade by this point. They felt we needed people Who would work in the real world. They believe we needed professional management. And one of the most interesting parts of the story is that John and his father were the ones that pushed for the IPO More than his investors did.

59:48 And this is why. I raise the prospect of an IPO in a next board meeting. And the hitchhikers weren't very enthusiastic. It's too soon, they said. You're not ready to go public. Let's do another round of venture financing. And grow the company another few years before you IPO. After the meeting, my father followed me into the office fuming.

1:00:04 And he let it rip. We've got to get those fuckers out of the company before they take over. Since the VCs only own thirty four percent of the company, they weren't able to block our collective decision to go forward with an IPO. And so we began the process. So now they are a public company, he drastically accelerates. his drive to buy up as many of these other

1:00:26 uh competitors as possible and growth through acquisition. But there is there's a ton of detail in the book and I really hope you read the book. Every single person that I've given the book to has has enjoyed it. There's so much detail. But I do wanna pull out uh one of these acquisitions'cause I think there's a there's a counterintuitive lesson. In fact, one of the things that Me and John bonded over when when we

1:00:44 We're speaking is the fact that he thought the podcast was a good discovery mechanism. to find books and entrepreneurs that he never knew about and you know, if he liked the episode he would buy the book and and read it. And so one of his favorite uh discoveries through the podcast was Sam Zamurri from the book The Fish That Ate the Whale, The Life and Times of America's Banana King, written by Rich Cohen. And there's a story in the book that is something that Sam Zamurie would do. So

1:01:05 They're they're buying a bunch of their competitors and one of the ones that that first inspired him was This company in Southern California called Mrs. Gooches. It was we I think he thought was like the best Natural food store on the West Coast. And so he goes to the board and is like, we have to do this. And he's always, you know, default aggressive, and they're always trying to wheel him in. says this is our moment. If we don't take it now, we'll lose it forever.

1:01:29 John, this is ridiculous, my father shouted. You're being reckless. It's too much too soon. We're growing too fast. We're diluting our stock. We need to integrate All the other previous acquisitions first. You won't be able to manage a company of this size, but dad, this isn't just any acquisition. This is Mrs. Gooch's.

1:01:46 I know the timing isn't perfect. We're not ready to buy them. But they're ready to sell the opportunity is there now and it won't come around again. And so when I got to that part and John's perspective on that acquisition, yes, we're not ready for it, but that doesn't matter. We still have to do it. There's a line in Sam the biography of Sam's Murray, The Fish That Ate the Wheel, that says

1:02:06 There are times and this is what Sam did in his career sometimes. There are times when certain cards sit unclaimed in the common pile. When certain properties become available That will never be available again. A good businessman feels these moments like a fall in the barometric pressure.

1:02:22 A great businessman. Is dumb enough. To act on them. Even when he cannot afford to. Now this is a devastating

1:02:32 devastating part of the book. When I was reading the book, one of the first things I wrote down when I knew I was gonna have dinner with John was I was like I the first question I wanna ask him is like tell me about your dad. There was this conflict between Yeah, his dad's practically his best friend is advisor. He's on the board. He's about

1:02:49 To ask his dad to step down. And he didn't understand the fights they were having because his dad's gonna have Alzheimer's, but they didn't know it then. Now this is probably the third or fourth time I've read these words and it just hits so much harder now that I know the outcome of the story and then how, you know, this still affects John to this day. John, please don't do this.

1:03:11 My father looked suddenly frail, his air of authority. and confidence had drained from his face that I as I'd uttered the words, Dad, I'd like you to resign from the board. My father had never begged me for anything in my life. But now he was begging me to change my mind. I was forty years old. He was seventy two.

1:03:29 He'd been my mentor, advisor, investor, and ally. For every step of the journey. For six tін years now. He had put his trust. In his college dropout hippie son.

1:03:41 And help me grow into a mature leader of a two hundred million dollar public company. А є і рісенір. He'd also increasingly been my adversary again and again. He tried to put the brakes on. When we needed to seize opportunities to move forward.

1:03:57 Please, he repeated, This is the last thing I'm doing in my life that's actually relevant. Looked at, I said, You're always gonna be my most trusted advisor. I'm still going to talk to you about everything. This will not change. But you're increasingly risk adverse, and I wanna grow the company. Asking my father to leave the board was difficult.

1:04:18 It was an important step in my personal growth. I was coming into my own As a leader and as a man. And it was devastating. It had to be confusing for John because It's almost th it's a little under three years later they figure out something had been happening the whole time. And so his dad calls him, he's like, I have something I need to tell you. I have Alzheimer's.

1:04:37 And so the diagnosis comes in in nineteen ninety-six. His dad dies in two thousand four, and the next ten years also coincides with some of the most difficult times. that John's gonna have in his career and imagine Put yourself in John's shoes. He's going through the most difficult time. Of his life.

1:04:54 And his trusted advisor The person he knows without a doubt has his best interests in our heart that loves him unconditionally is slowly whittling away at the same time. This part is devastating. It's so difficult to read. I went to another significant transition in my personal life. My father who had lived with Alzheimer's for years

1:05:14 And was now barely recognizable as the wise mentor I so greatly loved and had depended on so much in the early days. Died in November two thousand four. It had been more than a decade. Since his wisdom had graced our board meetings And many years since I'd been able to call on him for advice about strategy.

1:05:30 Sadly. His personality had long since succumbed to this horrible disease. I was fifty one years old. And both my parents were gone. My father had been an essential part of shaping not only who I was as a man.

1:05:44 But also Who I was as a business лідер and entrepreneur. His death was a disconcerting experience that plunged me into a deeper reflection on my own life and mortality. I had the strange sense. That a mirror was being held up.

1:05:59 That reflected my own time on this earth. Who was I? And what was the truth about my own life? Was it good? Was it beautiful? Was it enough? Was I

1:06:11 Enough. Four years after his father's death, he gives his commencement address. And I think this device is very powerful. And something I've tried to do in my own life. And the advice from his commencement address is honor your parents and forgive them for their mistakes.

1:06:26 He had a lot of resentment towards his mother and the fact that his mother up until her dying day didn't approve. Of you know, her his choices in life. And yet, you know, he's done that inner work that he and gone through all this therapy and so when I talk to him now, it's like I don't sense that he's still harboring ill will towards his mother. And so this is the advice that he gave uh during his commencement address I think is really good. Honor and appreciate your parents. No one will ever love you quite like your parents do. And although they have No doubt made plenty of mistakes in helping you grow up.

1:06:55 They've also done their very best job that they knew how to do. They've made far more sacrifices on your behalf. Than you will ever really know. Please forgive them for their mistakes and imperfections.

1:07:07 them and honor them while you can. Because the simple truth Is that you won't always have them with you. As you move further along on your life. Journey.

1:07:17 So I wanna transition into the second half or maybe the even the later half of the Whole Foods history. I do wanna Uh wrap up Just this this expansion, this this how he worked himself and his company to the most dominant position in their industry. And so there's a paragraph I wanna read to you that's his writing and then I'll summarise this'cause I think these principles are timeless and and applicable to al almost ever every single one of us.

1:07:39 I think that's why whole foods market emerged out of that first generation as the only dominant national company. Buying up all those other brands. It wasn't because we had the best stores. It was because that's such an important part. It wasn't because we had the best stores. It was because we were more ambitious.

1:07:53 And thought strategically about the long term. We ran our business frugally. And our stores to be highly profitable. And we weren't ambivalent. about either money or growth. So we didn't win.

1:08:06 Because we had the best stores. The best stores are the best products, if you think about the store as an actual product, right? What's crazy about this industry is the best products were actually losing money. They had the highest quality stores, but they weren't running good businesses is the way to think about that. We won.

1:08:21 Because we were more ambitious. We were more strategic, we were more focused on the long term, we were more frugal. And we were mo more focused on profit. Now there's two things John said when we were together that blew my mind. One.

1:08:36 He says that Walmart Возвонове кісто фуд, це. was cr like crazy to think about. Why? Because the super centers that they started opening up, right?

1:08:47 They caused grocery stores so now Walmart goes from a normal retailer to you can buy Every single thing that you want, including groceries in our super center. So their super centers cause grocery stores. to keep going down market over price, which means When the warmer super centers

1:09:04 Up first appeared in Costco the same way. first appeared on the scene. The grocery stores. Their initial reaction was wrong. Their initial reaction was, We're gonna try to compete with Walmart on price. They didn't know the scope of the threat they were dealing with. He said whole foods

1:09:21 We went up market. We would sell higher quality at higher prices. That was fascinating to me. The second thing that he said. is probably the craziest like And I mean that in a a great way. Like the craziest thing anybody's ever told me about the impact that this podcast could have. He said that if my podcast had existed when he was younger

1:09:42 Whole Foods would still be an independent company. Because the podcast over and over again all of history's greatest entrepreneurs constantly emphasize The importance of controlling expenses. as Whole Foods grew and expanded.

1:10:00 He let expenses get too high in the boom in the mid two thousands. Over time this is very natural. as you m especially as you're more successful, you let expenses uh expenses rise But History's greatest founders know is that

1:10:13 Costs and expenses are constant and revenue is cyclical. So in a boom in a good time. You're letting your cost structure creep up. Because your revenue's creeped up. This is in human nature. And then you're gonna have some kinda slowdown or maybe increased competition.

1:10:26 So the revenue pulls back, but the expenses stay the same. That then opened opportunity for an activist investor to buy a large block of shares and influence the board. This leads to John looking for a white knight, which winds up being Amazon. So I wanna focus on the time from the f financial crisis in two thousand seven, two thousand eight. All the way up until when

1:10:45 John gets this idea to to try to sell the company to Jeff Bezos. So stock is down ninety percent. From the peak. This is late two thousand eight. This left us deeply vulnerable to shareholder activists. Opportun and he's gonna find that opportunistic investors who might buy up a large swath of the company and then impose their own agenda on us.

1:11:03 We needed to take action fast, but how? And so a friend of his and a fellow entrepreneur recommends this private equity firm firm called Leonard Green. And he says you should take money from them so you can shore up your balance sheet. And so in November two thousand eight Leonard Green, the private equity firm.

1:11:18 Invest four hundred twenty five milyen dollars into whole foods. In return for a seventeen percent stake in the company. They also agreed to always vote with management for the first eighteen months. This deal would turn out to be one of the best Leonard Green ever did. By the time they sold their shares in two thousand eleven

1:11:36 Just three years after investing. Our stock could regain all its previous value and much more. And they made about four billion on the transaction. This is where things get really complicated and frankly just uh really bizarre. So a few years later

1:11:52 He decides to share he has a really t this is this is gonna be reminiscent of what you and I just talked about with Sam Walton. Sam Walton. had a really talented executive. But that executor was so talented that he's like, I ca you know, I wanna be CO of Walmart. you know, I'm willing to wait a little bit, but if you're not gonna make me CO, just let me know now and I'll leave.

1:12:09 So Sam, even though he's not ready to retire and relinquish his control. He doesn't want to lose a talented executive. He winds up. Making him CO of Walmart, and then like eighteen months later he's like this is a giant mistake and he goes back to the CO position.

1:12:22 So John has a very talented Chief operating officer. And and president named Walter Robb. And he says, I knew Walter was hungry for more and that sooner or later someone's gonna make him an offer to be CEO.

1:12:34 I don't want to lose Walter. And so the only way I can keep'em was to promote'em. But I wasn't yet ready to give up the CO role. So he's like, Hey Walter Will you be co CEO with me? And so keep that in the back of your mind. I'm gonna get this email from the founder of Starbucks.

1:12:49 Which is friends with Walter Rob in one second, but what's happening now is the reversal of a trend that in the beginning helped'em. Remember I just said Walmart was one of the keys to our success at the beginning. Eventually that trend reverses. Why? Other supermarket chains had discovered that it was easier to focus on the higher quality end of the market Then try and try to appeal to Whole Foods customers

1:13:11 while undercutting our prices than it was to focus on the lower quality end. And try to compete with Walmart and Costco on price. This encouraged them to encroach on our market share. What I had known to be true for many years that we were competing not just with other natural food stores. But with conventional grocery stores

1:13:29 Was now clearly evident. We hadn't been alone in our niche. We just been ahead of the культуal curve. Now we had company. A lot of company in fact.

1:13:40 and that increased competition From conventional grocers. Was not great for our business. And so shortly after this, he gets an email from Howard Schultz, the founder of Starbucks. It's sent to John and one member of the board.

1:13:54 And John summarizes the email here. Absentee. Petulant. Disruptive. Undermining.

1:14:00 Disconnected from reality. A problem for the company and the leadership team. That is Howard Schultz describing John Mackie, but Howard's not on the board. Howard's not involved in the company at all. He's just close friends. With the co CEO.

1:14:14 Walter Rob. So it says uh Schultz had sent me this unpromped personal performance review. Schultz made his true intention clear. He believed that it was time for me to step down and make Walter the sole CEO. Now it gets m even more intricate. The only other person

1:14:29 On the email. was one of the board members, this guy named John Sokoloff. Who was part who worked with at Leonard Green. The PE firm that bought

1:14:38 Seventeen percent of the company for four hundred and twenty five million dollars. So John Mackie is talking to John Sokolov about the Howard Schultz email. And in that conversation, Sakoloff's like, Hey, you know, John, we should consider taking whole foods private.

1:14:53 The public markets are not the easiest place to execute a turnaround, he said. Whole Foods has a balance sheet that would easily support it. And I promise we could work out the financing. And John's response was, I worry that putting too much debt on our books would endanger the company, not to mention the private equity firms would control the company and their purpose would not be well aligned with ours. For now, I think

1:15:13 Were okay as a public company, he told Sokolov. And John Mackie talks about the difficulty of running a public company, you know, and And what happens is In good times, you kinda let things slip a little. He says we as a company had allowed ourselves to become complacent over the years. When our stock price was flying high.

1:15:30 And through the experience of running a public company, he realizes that what Warren Buffett would repeat the lesson from Ben Graham. About Mr. Merket, how accurate it was. After decades of experiencing these highs and lows for myself, I understood why Ben Graham and Warren Buffett love the parable of Mr Market. A kind of manic oppressive business partner who comes running in with a new price for the company every day. One day Mr Market saw me as a visionary.

1:15:50 The next day he saw me as the village idiot. And so when he reports another disappointing quarter. He suffers another As CEO of

1:16:02 Just a a company that he loved that was his soul. He call he calls it when I talk to him he he calls it His baby, he's still shops there to this day. And so one of the ringleaders of this coup is Sokoloth. And he says I wasn't and this is what John's response to this, I wasn't ready to step aside. Whole foods

1:16:17 Was still very much my entrepreneurial child, and no co founder wants to abandon their child amid stormy seas. I wasn't gonna do so prematurely because a board member who already made a forch office investment in the company under my leadership, had no patience for a transition that would naturally take some time. They want him to step down and make Walter Rob the CEO. Now over and over again All the he's getting all these like back channels of like uh I guess g gossip is the way you would I guess classify this.

1:16:41 And every time Walter Robbs like, hey, I didn't tell Howard Schultz to write that email, I don't know where Sakovov's getting this idea. I'm I'm loyal to you. I don't want you to step down. If you want, I would resign to prove this. And you know, John's like, Okay, well like No, if you're I don't want you to resign either.

1:16:58 But this went on for so long. that John needed to find a solution and he winds up finding the solution But while because at uh while this all was going on, he's reading a biography of Abraham Lincoln. I actually read this book too. It's incredible. The book that captured my attention in those days Was team of rivals.

1:17:13 by Doris Kearns Goodwin. It's the enthralling historical account of how Lincoln managed to lead a team of strong, diverse, and often competing personalities. Through an era of national crisis and division. So as he's reading the book Yeah, okay.

1:17:26 If what would Lincoln do? If he was in my position, what would Lincoln tell me to do right now? Boom, it suddenly hit me. I would ask Walter to resign as he had already offered to do on at least two occasions. I thought about Salmon Chase. This is literally from the biography. Got the idea from the biography. It's incredible.

1:17:43 I thought about Salman Chase, Lincoln's ambitious rival for the presidency in eighteen sixty four. And the secretary of the Treasury, who had offered his recogn resignation many times Intil one day Lincoln surprised him. And accepted it. It was time for me to accept Walter's offer.

1:17:58 And I had the confidence. That he would follow through and be a man of his word. I spoke to Walter in exactly those terms and reluctantly He accepted my request. Sokoloff.

1:18:09 was not happy with this turn of events. That is not the end of this, though. That is not the end of this. There is more shareholder activists. And this is the one that leads directly to the sale to Amazon. So says like most public company CEOs, I feared few things. This is two thousand seventeen, by the way. I feared few things more than shareholder activists.

1:18:32 Those calculating speculators who buy up sharing in a company with the sole intention of engineering short term increases in the stock price. So they can cash out at a quick profit. As a purpose driven leader with a long term vision, I felt threatened. At an existential level by the notion That some person who might never have set a foot in whole foods.

1:18:51 Could show up. buy a bunch of stock and then start dictating strategies with little regard for the long term costs of the company. And so on that spring day in two thousand seventeen, I learned that Jana Partners Had just announced its purchase of eight point eight percent of our stock. They had given us no warning.

1:19:09 I had known for a while that Whole Foods was vulnerable to exactly this kind of attack. And he describes the reasons why. The shifts in our competitive landscape. Or consequent slowdown in sales growth. And our flagging stock price all made us a target. And so Janem meets with Mackie and the executives, and he says essentially their message was this. We're gonna take over Whole Foods Market, we're gonna take control of your board.

1:19:29 And we're gonna replace management and then we're gonna sell this company to the highest bidder. And so his response was we created a plan to cut costs and improve operations. We also announced changes to the board. This backed off Jana temporarily, but I knew it wasn't enough.

1:19:44 And so he speaks with another investor in Whole Foods that knows What Jana Partners normally does is scanning Michael Schern. He says he pointed out that Jana Partners had won the vast majority of their activist battles by quickly and easily taking control of the board. I know you think your new board is a friendly one, he explained. But I suspect They're still going to vote you out and quickly.

1:20:04 And so this is when John realizes he needs a white knight. He needs a buyer. to evade this hostile takeover that that's gonna wind up with his expulsion. From the CO position and maybe even the board. And so his initial thought was Warren Buffett.

1:20:17 If a sale was inevitable, shouldn't we be proactively seeking a buyer that we felt would take better care of the company? Warren Buffett's name came up. And perhaps he would recognize the the long term value in our company and be interested in helping to protect it and grow it right. We reached out to him, but he replied that it wasn't a good fit. Day after day I walked.

1:20:36 Meditated and debated. Night after night I tossed and turned trying to come up with a solution that didn't mean losing the company that I love. I knew the solution had to be out there, a creative out of the box idea. I just couldn't see it yet.

1:20:52 My frustration grew as the days passed. And then one morning immediately after I woke up A question popped into my head. That changed everything. What about

1:21:03 Amazon. And so they reach out, they set up a meeting with Jeff Bezos and his team at Amazon. meetings actually have Bezos' boathouse and they wind up having this incredible multi hour meeting. And It looks like almost immediately they're gonna wind up w

1:21:17 working something out and he talks about his inner monologue at this time. I had nurtured whole foods. My child, my baby. From her infancy. I watched her take her first steps.

1:21:27 held her hand as she entered the adult world. And looked on with pride as she slowly grew into this mature, thriving business. Was I now ready to let her go? To marry her off to the richest man in the world. It just took two days to get Amazon's answer.

1:21:44 So Amazon buys whole foods in two thousand seventeen by two thousand twenty two. John Mackie is out. He worked. On whole foods. For forty four years. It was the summer of two thousand twenty two, and I was getting ready to make the biggest transition of my life.

1:22:00 Leaving whole foods market. After forty four years as its leader. And he talks about needing to do a bunch of inner work. And therapy to get over this Anger and resentment.

1:22:11 That he felt and this is a recurring theme. When entrepreneurs sell their baby, when they sell their company, the person that gives you the money is now in charge. And so this is part of the service that I think John Mackie's doing to future generations of entrepreneurs. Or four future generation entrepreneurs by writing about this so honestly. This layered needed to be experienced. The way in which I felt disrespected and disempowered.

1:22:33 Since the sale of whole foods to Amazon five years earlier. It surprised me with its intensity how angry he was. And beneath the anger Was a more subtle and corrosive emotion. Guilt.

1:22:44 Had I done the right thing in selling to Amazon. Should I have fought harder to keep whole foods independent? There wasn't an easy answer to those questions, but they needed to be asked. The first question everyone always asked me is Do you regret selling to Amazon? The most honest answer I can give is that I regret the circumstances that made it the best option.

1:23:02 I still believe it's the best strategic choice. Available at the time. And while not every hope and dream I had for this marriage of companies has come true. There were several wonderful positives that came out of it. At the same time

1:23:14 There are a few disappointments and frustration. So he talks about this. Over a few pages I'll summarize the pros. Lower prices for his customers. Higher wages for his employees. More stores.

1:23:26 Better technology. And then way better online ordering and delivery. The technology that Amazon bought w brought to Whole Foods was just way better than what he could build himself. The cons. There was more centralization of management, more bureaucracy, more sameness in the stores. And then a series of professional managers that were not aligned with

1:23:43 His culture. And what happened is slowly over time his influence essentially receded and disappeared. He thought He would still be able to run the the company and be the CO of Whole Foods inside of Amazon. My thoughts and strategic suggestions were not welcomed by the leaders in charge. I was simply cut from the team with no further explanation. This disrespect hurt. My aspiration for whole foods having greater cultural influence at Amazon

1:24:07 Was largely unrealized. And he understands this perspective because he said, Surely the thinking goes that th their culture must be superior Or the acquisition would have been the other way around. We had ourselves struggled with this same type of superiority trap in many acquisitions. That we had done over the years.

1:24:24 The tipping point occurred when In a video conference meeting I had in February twenty twenty one. With Dave Clark, Amazon CEO of Consumer Businesses and my Direct Supervisor. And so they're having a back and forth about this idea, and John keeps pushing and he says, Damn it, John, I told you we're not doing it. What do you not understand about that statement?

1:24:44 You always want to argue about every fucking thing. Sometimes you just need to be a team player and do what you're told to do. I try to put things into perspective. Dave, I don't think that's accurate. I don't argue about everything. Can you give me another example of when I've argued with you? John I don't have to give you a fucking example. I work with you.

1:25:01 I know it's true and it's not just me. Everyone at Amazon knows it's two. If you didn't want to give up control of Whole Foods, then you shouldn't have sold the company to Amazon. And then listen to John's surprising reaction. Dave was right. I had given up control when the company was sold to Amazon.

1:25:19 I knew it was now time for me to go. And so that's when he starts doing more therapy, he goes back with breath work and M D M A And he says it surprised me how much anger I felt about the disrespect Amazon had shown towards me. And how much guilt I had harbored over the decision to sell. This therapy helped him get rid of these like the feeling of resentment and anger.

1:25:39 He says I was able to confront a deeply held fear that I am not truly worthy of love due to my many faults and lack of perfection. This therapy also reminded me of slogan someone Uh some friends have shared with me previously. Holy shit, I'm alive. Waves of bliss flooded my body and were released. It felt incredibly joy I felt

1:25:59 Incredibly joyful to be here. Inhuman flesh. Breathing. Moving. Living and loving, what a gift. Holy shit, I'm alive.

1:26:10 And so obviously I read this before I met John and I asked him about this. Like, do you have any resentment Towards Jeff Bezos. He's like no. And he says the two smartest entrepreneurs that he's ever met. Are Elon Musk and Jeff Bezos. And in fact, he considers both of them.

1:26:25 W one thing that me and John bonded over is the fact that we had a lot of the same entrepreneurial heroes. So his entrepreneurial heroes are like Buffett. Elon Jeff Bezo Steve Jobs Rockefeller But he reiterated to me, he's like, No, I have no ill will towards Japanese at all. And he thinks that he's utterly brilliant.

1:26:42 And so then he ends the book, The Only Way an Entrepreneur Can. And he has a great framing about what what it is that we're actually doing. We're actually playing an infinite game. And so that was Key in the book, key in the conversation I had with John. Whole foods wasn't work.

1:26:55 It was play. And I think that's key to endurance and building a company for the long term. You love it. You love your work. It's fun. It feels like play. And so he starts another company. It's called Love Life. It's a holistic health and wellness club. I got to tour the entire facility.

1:27:11 And so he talks about this. He says, I became aware of a familiar feeling. Like an old friend. But one that has been too often absent in recent years. I'm really excited to get to work. It reminds me of the feeling I used to get as a kid when I waited impatiently on the sidelines for a game of pickup basketball to begin.

1:27:27 The eager anticipation of play. Play. That's what this was to me. I am a god of play. The primary field in which I love to play and to be creative.

1:27:39 Is business. I don't believe life is simply about our happiness or pleasure. It is also about discovering and following our higher purpose. And contributing our unique gifts and talents In the brief time.

1:27:51 that we have on this planet. When I first came up with the idea for Safer Way and Renee said Let's do it, Mac o Man. We thought it would be fun. That was the initial impulse.

1:28:02 If you told us then That the little venture that we started in a house. W by the time I retired. Grow to be a company with five hundred and forty stores. A hundred and five thousand team members.

1:28:14 and twenty two billion in annual sales. Та чаї the way America eats. We would have fallen over laughing. But then We would have gotten right back to work.

1:28:24 Building the company we loved. And it was because we loved and enjoyed it so much. That it became all those things. We could have never imagined. Whole foods was

1:28:35 And is a magnificent expression. Of my own higher purpose. I'm endlessly proud of it. But what I understand now is that my higher did not begin or end with whole foods market.

1:28:48 That's another reason I love business. At its best, it's a wonderful, creative. Ever evolving game. the best kind of game because the deeper you get into it the more you must learn in order to keep play it at a high level.

1:29:02 And the most important aspect of the game Is that it keeps moving. And changing. And developing Even as we play it.

1:29:10 In fact Because we play it. Business It's an infinite game. Infinite games are open ended.

1:29:18 They are played For the purpose of continuing the game itself. The creation and growth of Whole Foods was a delight to be a part of. Others will continue moving that ball down the field. But I'm not done with business.

1:29:31 I'm not done pursuing my own higher purpose. I'm not done with this wonderful. Infinite game. I'm on a new adventure now. I love being back in startup mode again. Free from the shackles of bureaucracy.

1:29:44 It's what makes me feel alive. Exuberant. And young in spirit. Another wonderful game to play. Another beautiful vision to bring into reality.

1:29:53 New worlds to create out of nothing. Let us love. Let us create And let us play. Again.

1:30:01 And again. And again. Forever. And that is where I'll leave it for the full story. Highly, highly, highly, highly recommend Picking up and buying a copy of the book.

1:30:12 If you buy the book. Using the link in the show notes, you'll be supporting the podcast at the same time. That is three hundred and fifty eight books down. One thousand to go. And I'll talk to you again soon.

1:30:22 There's two things that John and I talked about that I absolutely loved. One of them was explicitly stated in the podcast. That is the fact that John also shares my same habit. Not only he's a voracious reader, but he also has to reread his highlights from the books that he's read previously. The second thing that I loved that was implied, but I think obvious is that he was completely obsessed

1:30:43 uh with building whole foods and and believe in in his mission to change the way That people Eat. And one of my obsessions has been obviously making this podcast so then I can collect And distill the knowledge of history's greatest entrepreneurs and then spread that far and wide, because I do think these are

1:30:59 the life story of an entrepreneur, take the lessons out of them and then spread them as far as possible to so other people can benefit from that, you know, five four decade, five decade y long career. And so m this obsession of hey, I'm gonna collect and distill the knowledge of history based entrepreneurs. is what the pot like it it comes in the form of the podcast, but I've made a tool

1:31:20 to make sure that I never forget the lessons and I can pull them up on demand when I need them in that tool. his founder's notes, which you can now get access to that tool. So founders notes. let you tap into the collective knowledge of His Grid Entrepreneurs on Demand. In a variable ways. For the last six years.

1:31:36 I've been putting all of my notes and highlights For everything that I read. for the podcast into this giant searchable database. that you can tap into. And even if you didn't know about this tool, you've heard me use it over and over again because every time you listen to the podcast and when I'm referencing

1:31:50 past ideas from past episodes from past books, like Jeff Bezos, like Walt Disney. St. Walton, Munger, Buffett, all of this. That is me searching through founders' notes and pulling up those ideas. And that is a really important point to get across. What you see, if you subscribe to Founders Notes, That's the tool I use. You see the exact same thing that I use.

1:32:10 It is a tool that I made for myself that you can now get access to. subscribers to founders notes are using founders notes to help them think through issues they're having in their company. From anything from hiring to recruiting to marketing to leadership to preparing for board meetings. to preparing for sales presentations if you are already running a successful company. I think it's a no brainer to invest in this tool.

1:32:30 And now I've added a new feature that's also gonna show you how I use founders notes and it's gonna push ideas from history's greatest entrepreneurs directly into your brain quickly. That is this private podcast feed. that comes with every single subscription to founders notes. Which I have called Sage Advice.

1:32:46 And so let me give you an example. The episode I just made I read two bi two autobiographies of James Dyson's that you know it's probably fifty, sixty, seventy hours of reading. countless hours of inputting the notes and highlights into founders notes. And so what I did is I went and reread every single note and highlight. And then there's also an AI assistant.

1:33:03 That lives inside founders notes called Sage. And I when you ask Sage a question, it reads all of the notes, highlights and transcripts for every single episode. And I would ask questions about James the lessons from James Dyson's books. So Give me like give for example, give me a list of James Dyson's best ideas.

1:33:18 How did James Dyson think about marketing? What did James Dyson say about persistence? Things like that. And then what I did is I composed all that into a single document. And distilled that down to what I think Are the most powerful ideas. From James Dyson's fifty year career where he's built this

1:33:34 multiple, multiple billion dollar company that he owns a hundred percent of. And so you take fifty year career. Sixty hours of reading. And distilling that down into an episode that you can listen to in twelve minutes.

1:33:46 And so the idea with these mini episodes is I want to create a tool that if I can condense in s the ideas from somebody's entire career Multiple books. Into something that is Ten minutes.

1:33:56 Then that means you're gonna be able to listen to that over and over and again. It's gonna serve as a constant reminder and an easy way for you to download those ideas. Into your brain. So then you can use them in your career. So if you want access to the tool that'll give you a superpower to access the collective knowledge of history's greatest entrepreneurs, when you need it, make sure you go and subscribe. at foundersnotes.com.

1:34:16 That is founders with an S. Just like the podcast. Founders notes dot com.

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