Founder's Story - The Entrepreneurial Mindset: Embracing Struggle, Mastering Emotions, and Building Dreams with Tom Bilyeu | S2 Ep. 175
Episode Date: February 14, 2025In this candid conversation, Tom Bilyeu shares his unconventional journey from aspiring filmmaker to multi-million-dollar entrepreneur to billion-dollar exit. He dives deep into his early career strug...gles, the spark that led him into business, and the serendipity that enabled him to create a unicorn company that most of us know as Quest Nutrition. Tom unpacks the importance of timing, business fundamentals, and the power of storytelling in entrepreneurship. He also discusses how AI is revolutionizing small business operations and reshaping capital allocation while sharing personal insights on handling emotional ups and downs in the entrepreneurial roller coaster.Key Topics Discussed:The Spark of Entrepreneurship:How meeting successful entrepreneurs shifted his focus from filmmaking to business.Early experiences in a security software company and the eventual pivot to Quest.Building a Unicorn Company:The role of perfect timing, innovative problem solving, and a relentless drive.Balancing passion with sound business fundamentals.AI as a Game-Changer:Empowering solopreneurs and small businesses through accessible technology.The future of AI in business decision-making and capital allocation.Mindset & Emotional Mastery:The importance of not getting ruled by emotions—using them as data points, not directives.Real-life strategies for dealing with the inevitable ups and downs of entrepreneurship.Partnership & Vulnerability:How working closely with his wife transformed both his personal life and business.Building together: sharing life, celebrating wins, and navigating struggles.Future Visions:Tom’s obsession with longevity and his dream of creating a “next Disney” simulation.The integration of gaming, storytelling, and business education via Impact Theory University.Impact Theory University:Mission to make business education accessible and actionable.Helping aspiring and established entrepreneurs master the learnable skills of business.Visit TomBilyeu.com to learn more about Impact Theory University and join the community of entrepreneurs striving for business mastery and a powerful mindset. Check out his channel: https://www.youtube.com/c/TomBilyeuOur Sponsors:* Check out CoinFlip and use my code FOUNDERS for a great deal: https://coinflip.tech* Check out Indeed: https://indeed.com/FOUNDERSSTORY* Check out Kinsta: https://kinsta.comAdvertising Inquiries: https://redcircle.com/brandsPrivacy & Opt-Out: https://redcircle.com/privacy
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Today we have a very, very special guest.
Tom Bilyeu, you are the CEO of Impact3.
I don't have to give an intro because everyone, Tom, knows you.
And I got the privilege to meet you at an elevator at VCon a few years back and I
knew at that moment like I got to get you on this show because there's a lot of things
that you've been doing and I've been watching over the years on top of the fact that you
know the amount of success you've had but I think there's also maybe things that people
don't know about you and we're gonna dive into all that but before we do Tom what was that spark in your life that made you say you know
going all the way back I want to be an entrepreneur? Honestly I didn't want to
be an entrepreneur and I'm certainly not a born entrepreneur I wanted to control
my destiny as a filmmaker and I had met these two very successful entrepreneurs
and they said you look you're coming to the world with your hand out.
And if you wanna control the art,
you're gonna have to control the resources.
So you should get into business and get rich.
And boy, does that sound dumb now.
But at the time it sounded brilliant.
And I was like, yeah, let's do that.
I thought it would take 18 months.
It took 15 years, but it worked.
But that was the spark that got me into
business. The same guys that ended up being my partners in
Quest, but originally, I started in a security software company,
they had hired me just as a copywriter. And so it's been a
lot of years there, I thought it was going to happen in software.
And then I tried to quit literally went in gave back was
about $2 million in equity. And I was like, look, I'm not gonna cross the finish line.
I don't want anything for this.
I just need to go do something that makes me feel alive.
I realized finally that you cannot guarantee success,
but you can guarantee struggle.
And so I was like, I need to struggle
at something that I'm gonna love that makes me feel alive.
And so I was gonna move to Greece,
and because my wife is Greek, was gonna move to Greece and because my wife is Greek was gonna
move to Greece to some small town and just write screenplays and they were
like wait wait wait we're not happy either what would it take for the three
of us to keep working together and the answer to that question over time became
Quest but at the time like I said it was about eight years at a software company
first. So having then become a unicorn founder
and you exit the company,
I think a lot of people know that part of your story.
What would you say separates somebody
from a person who creates a unicorn company
and somebody who does not?
Okay, so that is gonna be multifaceted.
So let's start with timing.
If you want a unicorn company,
you are not gonna be able to brute force
your way into that.
You've gotta get something very right
about what the world wants at that moment
that has not been delivered for some reason
that you just get the timing perfectly right.
So take Quest.
When we started, we didn't start because we're like,
oh my gosh, this is gonna be the fastest growing company in America like is going to be crazy. We said, you know, I'd gone in
and quit. My partners were also unhappy. The thing that the three of us happened to share an interest
in was health and nutrition. It was something that I could show up every day and fight for my family
and have passion and a reason to be there. And I wasn't thinking, oh, like I know,
I'm gonna leverage my storytelling
and I'm gonna blow this brand up.
It was, okay, wait a second.
There's this thing coming that we now call social media,
but at the time, I just thought it was going to allow me
to build a thousand true fans.
So I was like, finally, I can stop being a slick marketer.
And because I so relate to the world in terms of story,
I'm gonna bring into a protein bar company,
which is the weirdest thing ever,
a studio to start making our own commercials and stuff.
That was really how I thought about it in the beginning,
was we were just gonna tell our own story.
We thought we had a really unique story.
I had this impulse to tell it in a new way.
I could see that this thing was gonna become something,
but it spoke to me.
And so on top of that, we wanted to end metabolic disease.
So when confronted with the fact that the bar we wanted
to make quote unquote, couldn't be made, we realized,
well, we either don't launch this company or we figure out
why everybody thinks this can't be made
and find a solution for it.
And then right as we're doing that
for our own private reasons, the world woke up to the fact that sugar was a problem and social media exploded.
So we were the first ones, we not like the first first,
but we were one of the first people with a brand to start making our own
content, telling a story,
really understanding what now we would refer to as community building,
but we were just doing it all out of a totally different impulse. So we got the timing
right. I happened to be a storyteller, so I understood all of the content creation
and all of that and match it with we made a product that was a real zero to
one moment. It tasted like it had sugar in it but didn't because we solved the
manufacturing challenge that made that possible. And so you just put all that
together with the world waking up suddenly
to sugar being the problem.
And now influencers on Instagram showing their six pack abs
and people ask, oh my gosh, what do you eat?
And they were all like Quest.
And it was just this perfect confluence of events.
So unicorns, they get, there is an element of timing
that I'm very sad to report is very real.
Then on top of that, we had spent,
I mean, they had spent way more time than me
building their chops as an entrepreneur.
And then I had already spent almost a decade
building my chops as an entrepreneur.
So now all of a sudden you have very business savvy people
that they get the timing right on something
that really matters to them at a personal level,
and you get the explosion that we had.
So being savvy at business, like literally how how do you run a P and L?
How do you manage cashflow?
How do you hire?
Well, how do you structure a business?
Like these are all things that are teachable.
And this is one thing that that's really bothering me about the way that people
look at, um, like people that sell courses.
So I sell courses, right?
Just a big black mark on my reputation.
The P the way that people look at this is so crazy. But here's the reality. Business works in a knowable way,
but most people don't know it. So at some point somebody has to teach it. Now admittedly, I don't teach how to get rich.
I teach you how to run a business. Now, if you get the timing wrong, if you have the wrong product,
you're not gonna go anywhere. But knowing how to be business savvy is a very learnable, teachable skill.
And if people can wrap their head around it, that this isn't about drop shipping.
It's not about the latest thing in marketing that entrepreneurship is about
understanding how to solve novel problems well, and you solve those novel problems
by thinking from first principles, but you also just have to have enough experience or thank God
for AI access to something that can answer all of your questions about, okay, well, I need to
formulate this deal. What are the 10 best ways to formulate this deal? ChatGPT is going to give that
to you like right away. It's absolutely incredible. It is a miracle. But you have to build that
knowledge set of how to think through those problems.
And a novel problem isn't a problem you've never seen before.
It's a problem no one has ever seen before.
But if you can teach yourself first principles,
it really is possible.
And so, man, don't let anybody tell you
that you have to be born an entrepreneur.
You do not.
But being a good person, wanting to help the world,
that is not the same as being
business savvy.
So if people can click over into that reality of this is a knowable, learnable skill, but
it is a skill and it must be mastered, then they've got a shot.
What an amazing story.
And I really like the perfect storm concept of so many things had to have been going right,
people in the right places.
How do you see AI being able to or enabling people to solve more problems because it can
tell them maybe how to or even the problems to solve.
So when you look at business and business success, do you think AI is going to enable
a lot of people to be more successful or could it even maybe get in the way?
Maybe it tells you too many things and then people are going in different directions.
Think of its current form.
It will change over time, presumably, but think of its current form as the most sophisticated
calculator or all of the mathematics that Excel can help you run.
So everybody has access to it, but it doesn't mean that there aren't people that understand
mathematics to a degree that they know how to leverage the
tool to far more sophisticated outcomes. So AI is not going to
make more people successful. What it is going to do though,
is to empower more people to run their own companies, that's
going to be one of the great changes in society over the next
10 years is I think you're going to see the disaggregation
of capital, which I don't know is a good thing, but it is going to happen. You're going to
see a disaggregation of capital. You're going to see a ton of solopreneurs that are building
companies that are really doing revenue. Call it, you know, your five to $25 million companies,
right? Relatively small in the grand scheme of things, but you can have a whole bunch of people
that are doing that all the way down to a gaggle of people
that are making their 75, 90K a year,
but they're doing it running their own company.
And that I think AI will facilitate massively,
especially as a agentic AI comes online
and people are able to actually get the AI to go do things.
I think that's gonna be a real shift, but everybody has access to it. This is going to be something there won't be these
huge modes where only a very small number of people have access to it. We just saw with the
release of DeepSeek how quickly they were able to chip away at the leadership of OpenAI. And even
OpenAI was already cheap compared to what you get. I mean, it's absolutely insane. So you'll see that but ultimately it's going to come down to well now that everybody has access
to this calculator, who understands how to allocate capital better. So not just balancing
your budget, but actually allocating the capital in the wisest way possible. So knowing what
questions ask chat GPT when it gives you multiple pieces of advice, which advice do you take? How do you know when to go? Nah, that's conventional
wisdom. That actually doesn't make sense. In this scenario, we've got to do something
different. Those will be all the differentiators. You made a video this year. I really enjoyed
your video about 2025. And you said something in there about embrace the suffering and controlling
your emotions. I personally have struggled with this when it comes to entrepreneurship. I feel
like it's a roller coaster as you know. You have a great day and the
next day everything is toppling and your whole world is crashing and coming down
and you feel like your business might go out. You might lose your business in
24 hours. It's insane and then the next day everything is back
and you're running 100%.
How do you handle those moments?
One, I don't value myself for success.
I value myself for the sincere pursuit
of something that I care deeply about.
And obviously, when I say sincere pursuit,
I mean, I really am trying to win,
but I accept that I'm not going to be able to control that, that it just may not
happen. And my life cannot be predicated on whether I win or lose. So that's number one. So if it all
catastrophically crashes down, it is what it is. Also, I think it is very important to understand
that your emotions are not always to your benefit. They help you make a decision. Emotions are
critical. You're
never going to be able to get rid of them, nor would you want
to. But you need to be very distrusting. So when I feel anger,
fear, anxiety, whatever, I don't go, Oh, this is justified. I go,
huh, I'm feeling an emotion. Why am I feeling that emotion? Will
enacting that emotion lead me towards my goal or not?
And if it won't lead me towards my goal,
then I'm gonna do everything I can
to get out of the grips of that emotion.
If I have to stop and meditate, then I will do it.
But you have got to have a very distrustful eye
to the things that you feel.
And all too often I see people fail in business,
fail in life, because they are convinced
because they feel something
that they should act in accordance with that feeling.
And I just fundamentally reject that.
But even people close to me, man,
I'm saying people that watch me, they see how I move,
they see the level of success I've been able to achieve,
all the while telling them,
this is because I don't trust my emotions,
and I am constantly looking for evidence of efficacy
that this thing actually works
I still need to have their emotions validated. That is an impulse. That is it's just insane. It's insane because
Things should be judged based on I have a goal. I know where I'm trying to get to
Will doing this thing lead me to my goal or not? If yes, do it if no don't
Will doing this thing lead me to my goal or not? If yes, do it.
If no, don't.
So yeah, I don't, I can articulate the reasons
why people need to have their emotions validated,
but I can't internalize it.
It is nonsensical to me.
I like that, don't trust your emotions.
Sometimes I need to not trust my emotions.
Luckily, my wife is there to tell me,
because she's a way better entrepreneur,
I think, than I am. I know you have been working with your wife and I always enjoy watching
her videos, your videos, and talking about the experiences and the fact that you both
are just so vulnerable. It's an inspiration. I'm coming out of the book soon and I'm very
scared because of the things I'm saying in that book
I've never said publicly but you two are so vulnerable and you talk about everything and it it's really inspired me
So what's been the the most rewarding part of working with your wife? That's very easy
So we share a life the the whole thing when we got married
I said to her look the experiment we are about to run is what does a life look like when you just completely take divorce off
the table? You know, like we are going to share this life. Now, of course, if there
was abuse or whatever, like we would eject instantly. But assuming that that's not the
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I was running companies and she was a stay at home wife.
And that was when we were really getting pulled
in different directions.
I was so stressed that I would come home and say,
do not ask me about my day, I don't wanna talk about it.
And so she felt totally isolated from a huge part
of my life, especially given how much I work and so starting at quest
we decided we were gonna build together and
And then it's just been incredible like you're you're you're actually sharing a life not in theory
But in practice and so getting to build something together and seeing each of us shine and grow has been
Truly incredible. So there's a lot hiding in the phrase share a life,
the ups and the downs, the being there for each other
when things go wrong,
forgetting to celebrate the same things.
And so like when Quest sold and we were suddenly wealthy,
that was like a thing we did together.
And so not only is it like, oh my God,
like we actually pulled this off,
it's we did this together, all the hardship,
all the late nights.
One of my favorite like clips that I have of my wife is,
we were in the facility by ourselves.
It was really cold and it was like a Sunday
on a really special weekend.
She thinks it was Easter.
I think it was Thanksgiving.
But anyway, somewhere, a period where it was cold and special
and she was just like not having a great time.
And she's like, here we are, like, yay.
And so you have all those ups and downs,
but when it pays off, and even if it only pays off
and like, wow, we really did that together,
like we spent that time, we learned those lessons,
we got punched in the face, we got back up, we earned our own respect, we really did that together. Like we spent that time. We learned those lessons. We got punched in the face.
We got back up.
We earned our own respect.
It's a big deal.
And when it pays off, of course, it's extraordinarily joyful.
But all of the ups and downs are ups and downs together.
Well, I guess when my wife and I were getting married,
part of her vows was she's not going to get married again.
So I guess I always hold that to her.
I'm like, look, when things happen, I'm like, you told me you weren't going to
get married again. So I mean, you're kind of stuck with me, but I do like that
when divorce is off the table. Uh, what are the things that you can do?
So thank you for sharing that. How do you look at longevity?
Obviously you've had incredible life success. Uh,
it's amazing the things that you both have had you get to do together,
your day to day looks incredible.
How are you looking at longevity when there's all these things on TV about how much money
people are willing to spend to live to 200, 250, who knows how long we'll be able to live
in the future, but how does that look to you?
Yeah, so I'm obsessed with longevity. I would give every dollar that I've ever made
to extend my life meaningfully, for sure.
Like that's not even a question.
The money serves no purpose if you are dead.
So that one's pretty easy for me.
I don't understand people that think,
yeah, this is only interesting to me
because I know that I die at some point.
It changes how I feel about my life, knowing that as of right now, that think, yeah, this is only interesting to me because I know that I die at some point.
It changes how I feel about my life,
knowing that as of right now,
I'm on a collision course with death for sure,
but it doesn't make it better.
So I don't share that frame of reference.
So yeah, I wanna live forever every day that I've ever had,
even though absolutely miserable ones,
I've always wanted the next day to come.
So that is my default stance on life.
May it go on forever.
If there was a cataclysm and I was the only person
that survived, as long as I could take my own life,
I would still wanna be the person that survived
just to like see the pure fascination of it all.
So yeah, I cannot relate to people that are like,
oh man, if half the world dies, I hope that I cannot relate to people that are like, oh man if you know half the world dies
I hope that I'm in the half the dies because I don't want to deal with the loss
Does not compute for me. I
Like that. I know I I don't know if I'd want to be the last person
Maybe like the last like two or three
But I was her wants to be the last person but if there is going to be a last person, I hope it's me, how about that?
That I like that.
Is there anything else that you're thinking like,
okay, I want to accomplish this?
Yes, of course.
So I'm trying to build the next Disney.
Now, what does that translate to in the real world?
Cause that actually sounds so outdated now
when I think about where the world really is.
But as a child of the eighties, you will forgive me that that's my reference point.
But I want to build Ready Player One, the game.
So if you read the book, it is a world that envisions a simulation
that is so compelling that people spend inordinate amounts of their free time
inside of that virtual world.
I expect that to be a very controversial thing,
but that is the most thrilling thing for me.
It is mathematically almost certain
that we are in a simulation right now.
And given that, I wanna see how amazing of a simulation
that I can create here this year.
It's not gonna be anything like, you know, actually real, uh,
but game development storytelling is still, uh, my deepest passion for sure.
Can you dive into, uh, the university and all the,
all of what you're building now when it comes to teaching people entrepreneurship
or how to be better at business?
Yeah, of course. So, uh something called Impact Theory University. And it was me saying, okay,
I am not a born entrepreneur. So I had to learn this through the school of hard knocks.
I've got the credibility of having built multiple companies. I built three multimillion dollar
companies, including $1 billion exit. So I'm like, this stuff is repeatable. It's teachable. And I
want to make Harvard Business School irrelevant. So we launched it with the desire to one, just
help people orient their mindsets. We do also mindset stuff. But to me mindset needs to be
applied to something. For me, that's something is business. That's how I impact the world.
So business class is both for people doing what we call going from zero to founder. So you know nothing about business, you have to orient yourself. How do I pick the business that I'm going to start? How do I begin to grow it? And then we also work with people that have an established business, some of them doing hundreds of millions of dollars in revenue, and we help them scale. So that is one of the great joys of my life. So
there are three things that we do. We've got the content,
which is what most people know me for the YouTube channel.
Then we've got the education impact theory university. And
then we've got the entertainment, which is on the
gaming side. And so yeah, getting a chance to not only be
a day to day operator, but also be talking to people about what
I'm learning and watching them deploy that in their own businesses
has been exceedingly gratifying. So my final question for you, and I always enjoy getting to talk to somebody else who also
get to have incredible conversations with other people, is there somebody out there who you're like,
okay, I've never interviewed this person or had this person on our show. I really, really want to.
For sure.
So because I'm so obsessed with AI,
I would love to get all the major players in AI.
Sam Altman certainly being at the top of the list.
Eliza Yudkowsky, I really would love to sit down with him.
There's a lot of major players in that arena
that I would really love to sit down.
Elon Musk, that would really love to sit down. Elon
Musk, that would be incredible, especially now. Boy, oh boy, is he a controversial figure,
but I am just absolutely gobsmacked at what he's been able to accomplish.
It is like he has six months for every day that I have. It's insane. I don't know how to make sense
of it. It's really, really incredible incredible and you can look at that and be angry
Or you can look at that and be inspired and I am
Incredibly inspired. Okay. I lied one final final question. I know we're almost out of time
Is there something that scares you about AI or something you're concerned about for the future when it comes to AI?
very much so if people aren't an
equal mixture of
Very much so if people aren't an equal mixture of
terrified and excited then I don't think they're looking at it right it is entirely possible that
Intelligence has an innate drive
To express its own will that may be innate to intelligence if that is innate to intelligence We are in trouble because we will create something that is far smarter than us and just as we have no ill will to the things that are not as smart as us.
But we intentionally or unintentionally corral them into their own little space and we move on and do our thing and using Elon's quote that if we're building a highway and there's an anthill in the way, it's like no feelings but we're gonna destroy the anthill to put the highway so I have no
doubt that a sufficiently intelligent being that has its own agenda and cares
deeply about its agenda and we could potentially get in the way of that
agenda will just hurt us even by accident so that that there is some
possibility that that happens but it's also possible that that's not a function
of intelligence and that intelligence may simply be
the ability to process raw data faster than the next person
to find more novel connections
that other people are overlooking
and that the amount of data that it can process
becomes just unbelievable.
So if all of that's true
and there are algorithms that create deep efficiencies, now all of a sudden you
can map things as complex as the human body for instance and say oh this is
exactly what this person needs to eat, do in this exact sequence, in this exact
time to live forever or here's how you harvest cells from your body and turn
them into organs so you never go into organ failure or here's how you upload
your consciousness into a computer and live forever. Whatever. All of those
things including driving the cost of energy to effectively zero are possible
with AI. So it is entirely possible that on the other side of a probably pretty
bumpy transition period, which I'm not delusional about that, is a world of abundance.
I think that that is probably more likely. Admittedly, I'm thinking like a sci-fi writer.
I'm not going to be able to give you a deep argument on AI alignment. We'll let the AI
philosophers debate that out. But I don't have any reason yet to believe that a fundamental nature,
that the fundamental nature of intelligence is will.
So we shall see.
I'm deeply concerned with it.
When you put all of this, like you said,
AGI and advancements of AI intelligence, you put this into a humanoid.
I don't know if people will have human to human relationships anymore.
Like if you could have the perfect, perfect spouse who does everything, maybe, I don't
know.
I'll be really excited when we think AI is perfect and then AI starts to mimic all the
negative things of humans.
I think that will be a funny day.
Like all of the issues that we think, this is the perfect human, then it comes down like,
oh wait, it does all the bad things that we do and it has all our same issues. I think it'll be
quite entertaining. Everything goes full circle, I guess in life.
Yeah. I mean, look, you really have your finger on arguably the most interesting thing about
the future of AI and what that question is. I actually wrote a comic book about this
five years ago now about the rise of AI and really looking at cyborgs and like as people
begin to do things like neurolink and begin to augment
themselves, what will happen? I think society bifurcates. So
you will for sure have human to human interaction because some
humans will absolutely refuse all the way to being violent.
They will refuse to interface with robots. They will reject AI completely.
We will go through that moment.
And so yeah, now whether that becomes a really small Amish style minority or
that becomes the majority, that remains to be seen.
But my gut instinct is that the advantages of AI will be so great that people will just move towards that.
Here, this might be one thing that you want to cut out because I know your audience will only have so much tolerance.
But one thing to consider is that humans are the midwife for a new form of life and that it's synthetic or synthetic biology and that is very possible.
If we have to augment ourselves to keep up
with a growing intelligence that has a will of its own,
the odds that that happens really get high,
really, really high.
Well, I'm hoping that it enables me
to just have conversations, I can hang out at events
I don't have to work or stress ever again because my AI agent or my you know, my AI robot or whatever my interface is
I'm very embracing
I'm very embracing to the fact that I just want to live life
Comfortably and happy and if my AI can do everything for me that sounds like a pretty good life
I think I don't know, maybe, but I guess.
As long as you have meaning and purpose,
there is no escaping the need for meaning and purpose.
Exactly, I remember a couple years ago
I got to hang out with Mogad Dat.
I'm sure you probably heard him speak.
He was telling me about this future life
where we're just, he was like, we just do this.
We just come to events and hang out and talk,
and we don't really have to work anymore.
I mean, sounds like a pretty good life.
But yeah, meeting in purpose, Tom, this has been amazing.
If people want to check out the university, how can they do so?
I go to TomBillyU.com.
Simple, TomBillyU.com.
Tom, a couple years ago, meeting you in the elevator to this moment right now, it's an
honor to have you on the show. We got to come back and talk about just AI. I feel like you and I could talk an hour about
AI because we think very alike about the future and many people say I'm slightly negative,
but I feel like no, I'm realist around the possibilities, but this has been incredible, and thank you so much for joining us today, Tom,
on Founder's Story.
Thanks for having me on.
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