Founders - #217 Estée Lauder

Episode Date: November 18, 2021

What I learned from rereading Estée Lauder: A Success Story by Estée Lauder. Watch Runnin' Down a Dream: How to Succeed and Thrive in a Career You Love by Bill Gurley.----Get access to the World’s Most Valuable Notebook for Founders by investing in a subscription to Founders Notes----[21:14] I sometimes wonder if I had set my heart on selling tassels, cars, furniture, or anything else but beauty, would I have risen to the top of a profession? Somehow I doubt it. I believed in my product. I loved my product.[32:07] Risk taking is the cornerstone of empires. No one ever became a success without taking chances.[39:24] I was single-minded in the pursuit of my dream.[44:38] Despite all the naysayers, there was never a single moment when I considered giving up. That was simply not a viable alternative.[55:59] We took the money we had planned to use on advertising and invested it instead in enough material to give away large quantities of our products.[1:02:20] Never underestimate the value of an ally. Today they call it networking—this sharing between colleagues. It is one of the most powerful tools in the business.[1:12:22] It's not enough to have the most wonderful product in the world. You must be able to sell it.[1:15:03] Love your career or else find another.[1:19:05] Visualize. If in your mind's eye you see a successful venture, a deal made, a profit accomplished, it has a superb chance of actually happening. Projecting your mind into a successful situation is the most powerful means to achieve goals. If you spend time with pictures of failure in your mind, you will orchestrate failure. Countless times, before the event, I have pictured a heroic sale to a large department store every step of the  way and the picture in my mind became a reality. I've visualized success, then created the reality from the image. Great athletes, business people, inventors, and achievers from all walks of life seem to know this secret.[1:21:34] I've always believed that if you stick to a thought and carefully avoid distraction along the way, you can fulfill a dream. I kept my eye on the target. I've never allowed my eye to leave the particular target of the moment. ----Get access to the World’s Most Valuable Notebook for Founders by investing in a subscription to Founders Notes----“I have listened to every episode released and look forward to every episode that comes out. The only criticism I would have is that after each podcast I usually want to buy the book because I am interested so my poor wallet suffers. ” — GarethBe like Gareth. Buy a book: All the books featured on Founders Podcast ----Founders Notes gives you the ability to tap into the collective knowledge of history's greatest entrepreneurs on demand. Use it to supplement the decisions you make in your work.  Get access to Founders Notes here. ----“I have listened to every episode released and look forward to every episode that comes out. The only criticism I would have is that after each podcast I usually want to buy the book because I am interested so my poor wallet suffers. ” — GarethBe like Gareth. Buy a book: All the books featured on Founders Podcast

You never realize that you're making a memory at the moment something's actually happening. Stranger still, the strongest memories are those you never dreamed would survive and would be inextricably linked to your future. Momentous happenings can lie buried in the past while tiny, needle-sharp split seconds sometimes stay with you forever. They happen in a moment and they tug at your memory endlessly. They live, always, just below your consciousness. I remember the woman at the Florence Morris Beauty Salon where I had my first cosmetics

concession. She was thoughtless and cruel and will always remain that way in my mind. Maybe she was a catalyst for good in the end. Maybe I wouldn't have become Estee Lauder if it hadn't been for her. At the moment she was cast in my memory, to last there forever, I despised her. Simply thinking about that incident brings back a twinge of pain. She was having her hair combed, and she was lovely. I was very young and vulnerable, and I loved beauty. I felt I wanted to make contact with her in some small way. What a beautiful blouse you're wearing, I complimented her. It's so elegant. Do you mind if I ask where you bought it? She smiled.

What difference could it possibly make, she answered, looking straight into my eyes. You could never afford it. I walked away, heart pounding, face burning. Never, never, never will anyone say that to me again, I promise myself. Someday, I will have whatever I want. That is an excerpt from the book that I just reread, and the one I'm going to talk to you about today, which is the autobiography of Estee Lauder. It's called Estee, a success story written by Estee Lauder.

Okay, so the first time I read this book was about a year and a half ago, and it's originally Founders No. 136. And the reason I decided to reread it right now actually has something to do with, one, my favorite talk on YouTube and a lot of people that listen to this podcast. So I'm just going to explain this real quick, and then I'll jump into the book. So I've mentioned this talk over and over again, probably at least 10 times on the podcast throughout the years. It's by an investor called Bill Gurley. And it's called running down a dream how to succeed and thrive in a career you love. I will definitely link to the YouTube video. I highly recommend I don't I probably watched it 10 times. It's had a big influence on how I approach specifically founders. And in the talk, Bill tells the story of five people that went to extreme lengths to run down a dream to actually succeed at getting their dream job.

And those people are Danny Meyer. I actually read Danny Meyer's autobiography. This is actually before I saw Bill's talk. It's Founders No. 20. It's a fantastic autobiography. It's recommended to a friend of mine who's a restaurateur. I've mentioned that a couple times on the podcast as well. It's called Setting the Table.

And there's just a ton of lessons that Danny applied to building out his restaurants. And later on, I guess after the book, he had founded Shake Shack. But I think when he published the book, they only had maybe a handful. There might only been one Shake Shack or just a handful. It definitely wasn't public and definitely wasn't the size, nearly the size that it is now. But anyways, it's a fantastic book. And if you want to learn more about that, that's back on Founders 20. So it's Danny Meyer, Bobby Knight, the basketball coach, Bob Dylan, Sam Hinckley, and Katrina Lake. And so there's something that Bill said in that talk

that I took as a personal challenge and use as a North Star. And he again, the entire talk is him observing how people have gone to extreme lengths. He talks about, listen, you got one life to live. Most people pick one career path. Like, why not go and actually do something you love? And he talks about how rare that is, the ability to do that. And so there's a bunch that jumped out to me, but this is the thing that really influenced how I approached founders. So he says, be obsessive about learning in your field, hone your craft constantly. Remember, he's talking about the traits of the five people that he's profiling, and I'm sure he's worked with a ton of other founders and investors as well that share these traits. Be obsessive in your field, and you'll see how this ties together, and I'll explain why

I'm doing Estee Lauder because she has all these traits. She ran down a dream. She is by far one of the most formidable individuals I have ever come across. I've mentioned it multiple times on the podcast. I think modern day entrepreneurs sleep on Estee Lauder. I don't think I've ever met another entrepreneur that has actually read this book and it's a shame. It's only 220 pages. I dropped everything recently and read it in 24 hours, reread it in 24 hours. Her approach to her business could be applied to anything that you really love. I think I've mentioned on the podcast before, if there's some way to reincarnate S.A.

Lawler and bring her back today, she'd be kicking entrepreneurs ass up and down the court to this day. She's a person well worth studying, reading about, listening to podcasts about, whatever the case may be. So this is what Bill says. Be obsessed about learning in your field. Hone your craft. And you'll see today that she did this.

I mean, she was obsessed with beauty. She writes the book. So she discovers her true passion. I think she's around 12 years old at the time. She writes the book when she's 79 years old. She is still obsessed about the same thing. So be obsessed about learning in your field. Hone your craft constantly.

Understand everything you possibly can about your craft. Consider it an obligation. Hold yourself accountable. Keep learning over time. Study the history. Know the pioneers. Strive to know. Now, this is a really important part for what I'm about to tell you next. Strive to know more than anyone else about your particular craft. You should be the most knowledgeable person. It is possible to gather more information than someone else. He's like, and that's a really important point. You don't have to be a genius to gather more information. This is applicable to everybody.

So he says, the good news, if you're going to research something, this is your lucky day. Information is freely available on the internet. The bad news, you have, and this is what really motivated me and held me accountable. You have zero excuse

for not being the most knowledgeable person in any subject you want. The information is right there at your fingertips. And so he's delivering this talk to the University of Texas MBA program. And the example he uses in his speech is esports. And he talks about, you know, over a specific period, I can't remember, maybe it was like six months, you can get to the top five if you're really on the ball. I think within like two years, you should be the most knowledgeable person. And, you know, he's challenging you. He's like, come on, this is doable. You can just go out and gather more information than somebody else can in two years.

You can definitely do that. And so this talk, along with reading Paul Graham's essay, I mean, all of Paul Graham's essays are fantastic, but Paul Graham has an essay called How to Do What You Love. I think Bill's talk on YouTube and Paul's essay on his website work really well together. They were really helpful to me is what I'm saying. So let me bring to how I decided to do this book. Bill, who's obviously really well known in the entrepreneur startup investment community, winds up sending out a tweet a couple of days ago. He says, listen, LazyWeb, who are some of the world's expert on biographies? I'm looking for someone that is top 1% in number of biographies read. And here's the crazy part, because remember,

it's Bill's talk that really focused, okay, I have no, like, there's no excuses, you have to do this, like, you're not serious, if you can't just go out and collect more information. And so you go through that thread. And I'm pretty sure the only person mentioned more than one time is my name in this podcast. I don't even know how many times, but it's a lot, which is mind-blowing to me because this is literally the person that helped me help crystallize my thinking just because he decided to publish this fantastic talk. And I don't even remember where I discovered it, but it's absolutely amazing. And so anyways, that led Bill to, I was able to exchange some messages with Bill because he wanted, he's researching, he's expanding on the ideas, this methodology that he discusses in the talk.

And that's why, again, I'm going to link to the talk. I'd watch it as soon as you can, watch it over and over again. I just want to give you the like his five point methodology. And again, to the way he connects this with five life stories, it's just absolutely fantastic. And I think if you watch it, you'll be able to get inspiration from and hopefully cheat run down a dream. I think that's the holy grail, not to have a job, but to have a calling a mission, something that you absolutely love to do. And so his five-point methodology is pick a career about which you have an immense passion. Now remember all these because I'm going to tie this into Estee Lauder.

Because one of the people I sent to – I let Bill know about based on the books and the research I've done is Estee Lauder. She fits his methodology exactly. And you'll see how that – if you're able to steer your life into a career where you actually, where you have, let me just go through it because then you just have a massive advantage. He's a fantastic line. He's got a great, a bunch of great lines in the talk. But one of my favorite, he talks about that you can't fake this. And you'll see this as we go through Estes' story today. But he says, if you run it, he talks about if you're running at something, and you actually don't care about it, like you can't, like, it's going to be obvious that you're faking it. If you run at these things and don't have a passion for them, you're going to burn

out eventually. This is very similar to what Steve Jobs told us that half his opinion is half of what makes what separates the successful entrepreneurs from the non successful ones is pure perseverance. And that one way to like most people give up the one way to avoid giving up is that you actually love it because the reason you should love is because it's gonna be really difficult and you're going to be tempted many times throughout your career to give up just like steve was but the fact is i he loved what he was doing more than anything else in the world he's actually the example i talked about this a few podcasts ago i don't remember what episode but it really struck me i was at dinner one time and i was wow, like there's a there's saying that you love what you do.

And then there's like there's levels to saying how much you love what you do. And at the most extreme level, I think I referenced Steve Jobs and Warren Buffett. I was like, because how much would you when Steve Jobs was alive, how much would you have given him? How much money would you like? How much money would you have to give him for him to stop working at Apple? How much money would you have to give Warren for him to stop working at Apple? How much money would you have to give Warren Buffett to stop working at Berkshire Hathaway? And the answer, of course, is there's no money. There's no amount in the world that would have stopped them. They love what they do. It was not about the money. So anyways, he says, if you run out those things,

don't have a passion for them, you're going to burn out eventually. If it's not going to be where you want to be, the last point, you just can't fake it. Somebody else is sitting in some other MBA program that has a deep passion for whatever career path you're going down. And they're going to smoke you if you don't have it yourself. So number one, pick a career about which you have an immense passion. Number two, be obsessive about learning in your field. And so that's funny because in the talk, and Danny, towards the very end of the talk, he talks about Danny Meyer, uses this phrase, professional research constantly. I think it's an interesting phrase. Do you go home at night and study for yourself?

I mean, I consider founders professional research. I've stole that idea from Danny. In the past, you've heard me talk about develop a personal curriculum. I think I've used personal research and development. Danny's words are better than that. Professional research. Do you go home at night and study for yourself to improve your own skill set and this is the most important part what bill says about and what he learned obviously from danny his own life most people don't do that and that last part most people don't do that if you've ever seen the movie seven uh it's with morgan freeman and brad pitt if i'm not mistaken

there's a fit there's a scene in that movie I've never forgot. And it's Morgan Freeman is let into a library late at night by the security guards. He's doing research and the security guards are just upstairs. They're all sitting there instead of reading or, you know, taking advantage of the time that they have when there's an empty library at night. They just sit there, sit around and play poker. And Morgan puts his hat down and says, gentlemen, I'll never understand you. All these books, the world of knowledge at your fingertips. And what do you do? You sit around and play poker all night. What Morgan says in the movie and Bill says in the talk, most people don't do that. It's the exact same idea. So be obsessive about learning

your field. That's number two. Number three, develop mentors in your field. And so I say for people that are just getting started or don't have any mentors, use books, obviously reading biographies. These people can act as mentors in historical context. I think that the maxim that Charlie Munger uses for that is he says he makes friends with the eminent dead. Number four, embrace peer relationships in your field. And number five, always be gracious and pay it forward. Okay, so I'm going to jump into the book, I will point out to you where I think the parts where Estee fits this methodology, there's just a ton, like, there's just a ton to learn from her. She talks about this is very fascinating. Because one of the things is like, you have to know the history of your of your industry. And she points out that

she is she can build a business around things that are just not changing. She points out that beauty is an ancient industry. This is kind of an echo of the idea. One of my favorite ideas from Jeff Bezos about this idea is like, everybody talks about, oh, what's going to change in the next 10 years? He's like, you should ask the opposite question. What's not going to change in the next 10 years? Because those are the things that you can build a business around. And then when you invest time and energy,

since they're going to be around for 10 years, you can actually get like return on that investment. So in Amazon's case, he's like, I asked myself, you know, in 10 years from now, I knew that my customers would want, today and 10 years from now, they're going to want a wide selection of products. They're going to want low prices and fast deliveries. Like no customer 10 years from now is going to come to me and say, hey, Jeff, I wish you delivered the packages a little slower. Hey, Jeff, I wish you raised your prices. So he says, I invested a lot of time and energy in those principles. So it says, beauty has always commanded attention.

In a perfect world, we'd all be judged by the sweetness of our souls. But in our less than perfect world, the woman who looks pretty has a distinct advantage. Beauty secrets have been passed on from mother to daughter through the ages. Primitive women painted their faces with berry juice. Nero's Roman beauties whitened their faces with chalk. From Cleopatra's fabled milk bath to the ancient Egyptian's pot of black coal, from the rouge flapper cheeks of the 1920s, you can clearly see she studied the history of her industry.

That's the point of this. All the all the way to s.a lauder soft magic women have always enhanced their god-given looks it will it has always been so it will always be so and so on the very next page we see another echo of an r of another jeff bezos idea this idea that mission missionaries make better uh better products beauty for was a mission. It was not just a product. An interesting point. Beauty is the best incentive to self-respect. You may have great inner resource, but they don't show up as confidence

when you don't feel pretty. People are more apt to believe you and like you when you look fine. And when the world approves, self-respect is just a little easier. The pursuit of beauty is honorable. And she goes on about this for quite a while. This is more on the history of beauty and its universal appeal, which, again, this is just the way to think about this. This is the foundation which she built her business or her empire is a better way to put it.

Beauty is a fine invention. The art of inventing beauty, which is what she does, transcends class, intellect, age, profession, geography, virtually every cultural and economic barrier. There isn't a culture in the world that hasn't powdered, perfumed, and prettied its women. Love has been planted, wars won, and empires built on beauty. I should know. I'm an authority on all three. Love, wars, and empires have been woven into my personal tapestry for decades. I've been selling beauty ever since I could recognize her. So now she gets to the fact that one of her very first memories was about her mother's beauty. The first beauty I ever recognized was my mother, Rose. My mother came to my father with six children, was ten years older than he was.

One can imagine just how beautiful she was. I adored my mother's hairbrush, her hand cream, and her gloves. My mother's skin remained soft and supple until the day she died. When she did die at age 88, she was still beautiful and still certain of her appeal. If I'm not mistaken, Estee Lauder lives to 95 or 97 years old. Remember, we're reading the words of a when she's 79. She's so she is at this point been obsessed with beauty for what 6567 years, something like that. She's been working she starts she doesn't found her company till she's 40. But she works almost for free. Like she's constantly building, creating creams ever since she's a teenager and just giving them away for free. So really, the book is a culmination of 50 years of her 50-year obsession.

So it says this is really, really smart what her mom does. Her mom instills confidence in her, which is going to be really important because think about the time in which Estee is building her business. She wants to start building her business in the 1930s. This is extremely rare. And in fact, she has to delay, and I'll tell you more about this later, but she has to delay her dream because society's expectations and her family's expectations of her is, no, no, no, you're not going to start a business. You get married right away. You go from our house to your husband's house, and you have children, and you support your husband.

And so not only is it difficult to start a business, but also especially difficult for a woman to start a business back then. So she needs that confidence. And you can tell from her writing, she definitely has that confidence. And she says, so she's talking about what her mom, one of the earliest memories and earliest lessons that her mom taught her. The secret, she'd whisper, is to imagine yourself the most important person in the room, the person everyone else is waiting to see. If you imagine it vividly enough, you will become that person. And so that's something that essay is going to repeat several times in the book. The fact that it's very important to do the work, to trust your own judgment, to build up confidence in yourself, because there's going to be a ton of times throughout your career that the external world is going to try to get you to doubt. And, you know, even there's some crazy lines in the book. Like she says, my friends and family tried to dissuade me every day.

And so we'll go into more of that. Let's go back to more early memories, though, because this is another example that you should pick a career that you have an immense passion about. My very first memories of my mother's scent, her aura of freshness, the perfume of her presence. My first sensation of joy was being allowed to reach up and touch her skin her hair didn't escape my attention either as soon as i was old enough to hold a brush i would give her no peace este you've already brushed my hair three times today i can still hear her complaining gently my older sister renee submitted to getting her face padded with my mother's cream my beautiful sister-in-law fanny was perpetually saint-like in her submission to my treatment. So think about how crazy this is. She's a young girl, very, very young at this point, and she's describing what she's going to

spend her entire career doing. And so this is, I know I left myself as she was on this page, as she was born for this business. All of this annoyed my father considerably. Stop fiddling with other people's faces, he'd say. But that is what I like to do. Touch other people's faces. No matter who they were, touch them and make them pretty. Check this out. This is wild. Before I'm finished, I will set, I'm certain, the world's record for face touching.

As soon as school was over, I'd run home and then start on faces and hair. So I was even wrong. She's even younger. She's even younger. She's eight. Even at eight years old, being fashionable, being feminine, being different was a, this is a French word that I don't know how to pronounce, raison d'etre, which means the most important reason or purpose for someone or someone's existence, was the raison d'etre for me. Even then, I knew. So her father owns a hardware store. They have a gang of kids. There's like 10 kids or something like that. And they're all having

to work in the family business as well. And so she's taking lessons that she learns in the hardware store. And she'll apply them to her business, the Estee Lauder business later. It says, my father's hardware store was my first venture into merchandising. I love to help him arrange his wares. My special job was creating window displays that would attract customers how i love to make those windows appealing uh she'd work on gift wrapping and uh by covering a hammer or a set of nails with extravagant bows and papers which really did seem to delight his customers and this is something she talks about over and over again she's obsessed with packaging and to to an extreme degree wait till i tell you what she does she spends weeks uh debating just the color of like the jars that hold her creams in she'll go to extreme levels

of detail uh again this is not a job this is a mission a love affair uh is one way to think about for her so she's packaging this is the first time she mentions packaging in the book, but she talks about it a lot. She says packaging requires special thought. You could make a thing wonderful by changing its outward appearance. Little did I think I'd be doing the same thing multiplied a billion fold in not too many years. There may be a big difference between lipstick and dry goods, between fragrance and doorknobs. See how she's talking about what she learned in the hardware store store and applying it to later on but just about everything has to be sold aggressively i honed my techniques as i played with the wares at my father's store i whetted my appetite for the merry ring of a cash register i learned early that being a perfectionist

and providing quality was the only way to do business. I knew it. I felt it. And so now we have Estee talking about the advantage that you have if you actually love what you do because so few people actually do that. Go back to what Bill says. If you're faking it, you're going to get smoked by somebody that's not faking it. So he says, I want to paint a picture of the young girl I was. A girl caught up, memorized by pretty things and pretty people. Thinking about my childhood now reveals such early patterns. My drive and persistence were always there. And we're going to talk a lot about that today.

My drive and persistence were always there. And those qualities are that are essential for building a successful business. Still, I sometimes wonder if I had set my heart on selling tassels, cars, furniture, or anything else but beauty, would I have risen to the top of my profession? Somehow I doubt it. I believed in my product. I loved my product. A person has to love her harvest if she expects others to love it too. And beauty was such a bountiful harvest.

How could I have known this at 12? I don't understand it. I just did. And so something's going to happen when she's in high school that I think is a combination of a bunch of these ideas. She picks a career about which she has an immense passion. She's obsessive about learning in her field, but she also develops mentors in her field. And that mentor is going to be her uncle John, who's going to hold her dream job. When I dreamed of my private universe, I dreamed of being a skin specialist and making women beautiful. In every life, there's a moment, an event or realization that changes that life irrevocably. If the change is to be a happy one, one must be able to recognize that moment and seize it without delay. Rose Kennedy once told

me that good luck is something you make and bad luck is something you endure. A very wise observation indeed. People do make their luck by daring to follow their instincts, taking risks, and embracing every possibility. My shining moment came in the form of a quiet man who also loved touching faces. My uncle John Schatz. I don't know how to pronounce his last name. He was a skin skin specialist what glories those words conjured up he captured my imagination and interest as no one else has as else ever had i was smitten with uncle john he understood me what's more he produced miracles i watched as he created a secret formula a magic cream potion which he filled in vials and jars and any other candy container. So her first experience in the beauty industry is actually going to be selling

and giving away and demonstrating his products. It was a precious velvety cream, this potion, one that magically made you sweetly scented, made your face feel like silk, made any passing imperfection be gone by evening. I recognized in my Uncle John my true path. He produced his glorious cream in our home, working happily over a gas stove. I watched and learned, hypnotized. It was a mystery to me. My education was just starting. Listen to me, Este, said Uncle John. Just try my cream. Try it. I was devoted to it. I loved his creams, loved his potions, loved my Uncle John. You don't speak this way, if it's just a job. This is the story of a bewitchment. I was irrevocably bewitched by the power to create beauty. Uncle John had words,

worlds to teach me. We constructed a laboratory of sorts in the tiny stable behind my house. Do you know what it means for a young girl to suddenly have someone take her dreams quite seriously to teach her secrets? I could think of nothing else. After school, I'd run home to practice. There's that word we've been talking a lot about in the last few podcasts. I still can't get out of my mind how much Michael Jordan was obsessed with practice. I don't think that idea is ever going to leave me. After school, I'd run home to practice being a scientist. I began to value myself so much more. Remember, she talks about the importance of, and started with her mother. Somebody can jumpstart it, but you've got to develop this on your own.

The fact that you have faith in your abilities and self-confidence. Many more dreams are destroyed by a lack of self-confidence than by overconfidence. So it says, I began to value myself so much more. Trust my instincts. Trust my uniqueness. With my uncle, I was preoccupied with research into possibilities. Mine. Trusting oneself does not always come naturally.

I learned when young, the practice sticks. Today, there is no one who can intimidate me because of a title or skill or fame. I do what's right for me. And we'll see later in the book. I mean, it's rather remarkable. Even when she's just starting out, she's experiencing a bit of success. She winds up meeting other beauty company founder and CEOs, most of which are males at the time. They're rather patronizing to her and they're like, oh, you know what? you don't know what you're doing. Let me buy your business. And she'd clap back. She's like, no, you're not buying my business.

I'm buying yours. And she says, I never for once thought about selling. This is not going to happen. If I was to be a scientist with Uncle John, I needed live subjects on whom to experiment. So this is all about honing your craft, about the importance of practicing. I didn't have a single friend who wasn't slathered in our creams. If someone had a slight redness just under her nose that was sure to emerge into a sensitive blemish the next day,

she'd come to visit. I'd treat her to a cream pack and voila, Vaseline-proof skin. Friends of friends of friends appeared. I devised a name for my uncle's cream, super rich all-purpose cream. This is the first thing she sells, if I'm not mistaken. My reputation among my peers at high school grew by leaps and bounds. I gave away gallons of cream to friends. So that's another thing that Bill says in his talk. Let me see if I can find that quote real quick. So towards the end, this is about 50 minutes into the talk, he says all five of them.

He says out of all five people that he profiled, I don't think a single one of them started what they were doing for money. They were chasing a passion and a dream that allowed them to want to study. And then a few minutes later at 104 into the talk, he says you could be passionate about doing a startup and not about the vertical. I've worked with founders. He wouldn't name them. That was really funny. He says I've worked with founders that have done that. They usually sell instead of keep going.

Optimally, you want it all to line up. Having a passion makes a difference if you want to go all the way. And the reason I bring that up with Este is the fact she, for like two decades, she gave away most of her products. So she's clearly not doing this for money. And then she builds. I mean, her empire that she builds is insane. She's going to start in 1946. I think the first year, if I recall correctly, they do $50,000 in revenue. Most of it is ate up by expenses. And you fast forward, I think the last, I think Estee Lauder right now

is doing $18 billion a year in revenue. They employ 50,000 people. Her son, who's going to work in the family business from a away deep inside i knew i had found something that mattered much more than popularity my moment had come and i was not about to miss seizing it uncle john loved me i loved him and my future was being written in a jar of snow cream so she winds up getting married rather young and this is where she has to she delays her dream but her obsession grows so it says love interfered it really did. And postponed my dreams of being a skin specialist. Like I said earlier, her family expected her to go straight from my house to your husband's house. You support him. You have a kid. He's the one that's supposed to be doing the business. He's going to start a business. It's going to fail.

They wound up getting divorced, then remarried. And then he joins her in her business. So it says, we were struggling so hard to be independent, and sometimes things were not easy. Times were very lean. We had a beautiful son, and I spent my days mothering, and all the time, all the time, she writes that twice. That's on me repeating it. And all the time, all the time, I was mothering my zeal for experimenting with my uncle's creams, improving on them, adding to them.

I was forever experimenting on myself and on anyone else who came within range. Good was not good enough. I could always make it better. I knew now that obsession is the word for my zeal. It was never quiet in the house. There was always a great audible sense of industry, especially in the kitchen where I cooked for my family. And during every possible spare moment, cooked up little pots of cream for faces.

I always felt most alive when I was dabbling in the practice. There's that word again, when I was dabbling in the practice cream. I felt as though I was conductices. You do not talk about this this way if it's a job. Check this out. I felt as though I was conducting a secret absorbing experiment, a real adventure. This is not a business. This is a passion. Remember, she's not trying to sell these creams. She's giving them away. She's eventually going to

sell some. She recruits some of her first customers out of the beauty salon that she goes to. But for many, many years, she's making this and she's doing this just as a labor of love and so this is about some of the recruiting some of our first customers and then this is where we see her the Estee Lauder empire the one I just described to you of insane size and profits is uh starts with one counter uh many of the young women who came to the florist morris beauty salon to get their hair done would come to my home for a quick beauty lesson. I loved sharing what I knew and creating excitement about skin. One day, Mrs. Morris said to me, what do you do to keep your skin looking so fresh and lovely?

It would turn out to be a question of great moment for me. So this is obviously, I don't know if I'm clear. This is the owner of the salon. I don't know if you could tell just by matching the last names. It would turn out to be a question of great moment for me. I didn't have to be asked twice. The next time I come, I'll bring you some of my products. I don't know if you could tell just by matching the last names. It would turn out to be a question of great moment for me. I didn't have to be asked twice. The next time I come, I'll bring you some of my products. My heart was pounding. So she comes back. She says, would you mind? This is so funny because she does this all the time.

Oh, geez. Oh, man, I would not want to compete with her. Would you mind leaving them with me? She asked as I offered her my four products. I'm so busy now. I'll try them when I have time. I knew better. Just let me show you how they work, Miss Morris. I said, give me five minutes and you'll see right away. You'll see the right way to use them. Nothing could have induced me to leave my bounty without a demonstration. Remember what we learned from Claude Hopkins, David Ogilvie, Albert Lasker. There's not there's not a better selling technique. These are, you know, some of the most some of the most successful and knowledgeable people in the advertising industry. You could argue that Claude Hopkins is the most successful copywriter of all time. He said nothing beats a product demonstration. There's no words, nothing you can do, and he's demoing the product. I showed Mrs. Morris a mirror. She was a raving beauty.

Silence. She was thinking. So not taking no for an answer is extremely important, right? It's like, no, no, I'm not leaving this. We're going to do it right now. And she does this over and over again. She does this with buyers of, there's examples in the book where she does this department store buyers with, with like, what are they called? Like editors of beauty magazines. She's a bulldog. She's relentless. I showed her, so I skipped over

the demonstration telling you what happened. I showed her a mirror. She was a raving beauty. Silence. She was thinking, do you think it would. Do you think you would be interested in running the beauty concession at my new salon? She asked. I didn't hesitate for a second. Up until that point, I'd been giving away my products. This was my first chance at a real business. I would have a small counter in her store. I would pay her rent. Whatever I sold would be mine to keep. No partners. I never had partners. I would risk the rent, but it worked. This is one of my favorite sentences in the entire book. I would start the business I always dreamed about. Risk-taking is the cornerstone of empires. No one ever became a success without taking chances. Risk-taking first time I read the book about a year and a half ago. She calls it the sales technique of the century. Again, I would say Claude Hopkins had figured this out as well, Albert Lasker, a bunch of advertising people.

But this is fantastic. Now the big secret. I would give – she was the first – Estee was the first one to use this technique in the beauty industry. Now you see all of them use it. Now the big secret. I would give the woman a sample of whatever she did not buy as a gift. It might be a few teaspoons of powder in a wax envelope. Perhaps I'd shave off a bit of lipstick and tell her to apply it to her fingers. Perhaps in another

envelope, I would give her a bit of glow. I don't know what that is. The point was this, a woman would never leave empty handed. That's her point. I did not. Oh, this is such a good idea too. I did not have an advertising budget. She's going to talk about this later. I did not. Maybe she talks about it now. Let me not jump ahead. I did not have an advertising department. I did not have a copywriter, but I had a woman's intuition. I just knew, even though I had not yet named the technique, that a gift with purchase was very appealing. In those days, I would even give a gift without a purchase. The idea was to convince a woman to try the product. Having tried it at her leisure in her own home and seeing how fresh and lovely it made her look, she would be faithful forever. Of that, I had not with single doubt.

And so you see this. I think this is a well-known idea now, just in case it's not. I would say that you see it and there's a, this is a shining example of these ideas that we come across, that you and I come across over and over again. They're used by founders that don't know each other, that lived in different times, different cultures, different countries, different periods of history. And yet they all still arrive at the same idea, the same conclusion. That is like flashing red lights. Hey, this is an idea I need to use. So we see that demonstrations, demoing your product as much as you can is actually the best sales tool the best way to convince somebody uh that there's actually value in the

product the reason i say this is one of my favorite favorite ideas i wasn't it i guess it's gonna happen later in the book but she's you know she's she's starting the company her and her husband do not have a lot of money um so they're like okay well do we spend money on advertising and este makes the wise idea. She's like, I'm going to take what I was going to spend on advertising, and I'm going to produce more products, and I'm going to give away those products. And so now her products are selling.

She has the ability to hire some of her first employees. She's insane about the level. I love that quote by Steve Jobs, be a yardstick of quality. Most people are not used to an environment where excellence is demanded. I'm doing that off the top of my head. I'm pretty sure it's similar to that. She was the same way. She interviewed like 40 people just to figure out what one salesperson she wants to hire. She says, I made it my business to check with each of them each day to make sure, she's talking about the salespeople, to make certain she was selling

as I would. A devoted clientele was developing. Not to not to my surprise, of course. My products were the finest. The beauty salon atmosphere was perfect. Women were already in the self-improvement mood. Why should they go home? This is actually, you know, really smart. Why should they go home with beautiful hair and then a tired, lifeless face? It made sense to sell a total beauty package.

Word spread. Business moved gradually but steadily. And that's the biggest thing where you again, why I think Steve picked up on and other people picked up on why you have to really, really love it. Because building a business from a strong foundation, as we've seen over and over in these books takes a long time. Even in her case, she does $50,000 in 1946. 11 years later, she's doing $800,000. Not bad by any means, but it's, you know, her business was founded 75 years ago. It took her 75 years to get to 18 or 16 or 14 billion or whatever the number is.

But there's just no way that she's going to give up. And so she never interrupted that compounding. And so she says, word spread, business moved gradually but steadily. I worked every day from 9 when I arrived to polish my jars. Remember, she's working at the counter in the beauty salon to six in the evening. I never lunched. I felt I had to be there for every woman or I would surely lose her. So not only is she giving away her products, but her main sales method was a product demonstration. And so she talks about, you know,

I love touching faces. She's not just touching the face. She's like applying the creams, wiping it off, doing all this other stuff. I cleanse, creamed, colored, talk, talk, talk, and talked. I work like a charm and the interest in my line grew. And so she's doing this. This is what I mean. You're just, you're going to get smoked if you don't, if you're competing with somebody that actually loves what you're pretending to love. Because she's doing this in her store. She doesn't just do this in the store. If she sees you on the train, she'll talk to you. If she's in the elevator, the street.

She's going on vacation. Look what happens here. Quite by accident, I discovered an eager audience waiting for me in the fine hotels on Long Island. During a short vacation, I would make up a few women at poolside. Just randomly approaching people that are out there sunbathing next to the pool. Their response was electric. In the next few years, I'd spend some weeks at hotels on what might be dubbed working vacations. Many women would gather and ask me to teach them about skincare and cosmetics. It was fun for them and profitable for me.

Women wanted to learn. So before I continue this thought, when she starts off this section quite by accident, the note of myself is, by accident, my ass. She's obsessed. Imagine competing with her. One summer after another, I pushed myself, lauding creams, making up women, selling beauty. In the winters, I'd visit these eager ladies at their homes, where with a bridge game as a backdrop, I'd make up their friends and sell more creams. The mood at these sessions was exhilarating for me as for them. I didn't need bread to eat, but I worked as though I did. From pure love of the

venture, for me, teaching about beauty was and is an emotional experience. I brought them charisma and knowledge about their possibilities. They gave me a sense of success. I felt flushed with excitement after each session. Pure theater. In the end, that's what it was. This rendering of beauty. Pure theater for me. Now, the traits that she's demonstrating, the fact she's obsessed, she works constantly, she's in love,

she's single-minded in her pursuit, which she mentions multiple times, those also can have downsides. And so she's obsessed with her business to the detriment of her marriage. And so this is where she gets divorced. Now, I already told you they get remarried and she has a lot to talk about that, but let's get to the divorce part first. Now, she'll speak of a great time, great deal of pain, great confusion. It's difficult for me to speak on it. I'm always reluctant to diverge intimate family matters, but I determined to be candid in this book. So I shall. I'm a visceral person by nature. I act on instinct quickly without pondering possible disaster and without indulging in deep introspection. This quality can work well in the business world where

instinct counts and where one must be able to risk and take immediate action. But that same quality can be an irritant in personal relationships. I was moving steadily forward and all the progress brought with it a great deal of activity that neither interested in it nor in many ways included Joe. When he wanted to talk, I'd usually be off in another world thinking, projecting, planning my thoughts on a dozen different projects, my mind a whirl. I i was busy building a business i was single-minded in the pursuit of my dream and so to make matters worse is as her business is doing is starting to grow a little bit his business is not succeeding so they wind up getting divorced they stay divorced for four years she goes into details and you know she's like i had no experience

i went straight from my mother's house to my husband's house. Like I had no chance to be young and to actually date and to do other things. And she was, you know, still obsessed with building her business all the time. Business itself was the purest romance for me. That that is not how you speak or the idea, maybe not in these exact words, but that that's not how you speak if it's just a job. She winds up fixing her. She considers this her greatest mistake. She fixes her mistake and they're married for 50 plus years. And so they wind up reconciling. She says we were never to be separated for longer than a few days ever again. We always till the day he died, which is the blackest, saddest day of my life, had each other to hold, to talk to. And so this is what she talks about divorce. Now keep in mind, she's writing these words. This book was published in 1985. I have the hardcover version. Each time I hold in my hand, the, the, like it's solid red. Um, it doesn't have a dust cover. So like right now, my finger,

my fingertips are like all the, it's so old that the book, whatever the material is, is coming off my fingertips. So all my fingertips right now are completely red. So this is what she has to say about divorce. I would imagine the divorce rate is higher today. I don't know, but I would imagine. I feel compelled to tell you what I've learned about divorce. It is far too easy to say goodbye in America. In so many cases, when women marry again, they only change the face, not the problems. Too many divorced friends find that their second husband or even their third husband has more faults than their first husband who looked who

look now they're referencing the first husband. So the third husband has more faults than the first husband who looks better and better on someone else's arm. I always try to talk people out of divorcing. People divorce these days as fast as they change their hair color. So Joe and I were remarried this time forever, but with a few changes. We decided that Joe would give up his business and come into mine, where we would be equal partners in every sense of the word. We would work together. And so she talks about it's very important to have a partner or people working with you that have different skills than you do. She's obsessedzenegger where he says like you know whether it's a book a movie it doesn't matter like everything has to be sold like you should sell aggressively so when he came into the movie industry people you know a lot of actors like i like making movies it's an art and everything

else he's like okay yeah that's one part but now he was super aggressive in how he sold his product and it was like uh he talks about you know very different from most actors and i think uh the people he worked with saw that as a massive advantage. And Arnold says something that I love where he talks about, listen, if you have a product and you think that product is going to make somebody's life better, then you have an obligation to learn how to sell it. You know, they get to see a great movie. I get to make more money. That's fantastic exchange. Another great quote that I've never forgot comes from Peter Thiel's book, Zero to One, where he says, superior sales and distribution by itself can create a monopoly, even with no product differentiation. The converse is not true. That is screaming at us at how important sales are,

as they would agree with that too. I mean, obviously she thinks her products are the best in the world, but she knows they're not going to sell themselves. She mentioned that multiple times in the book. Let me repeat that quote, though. Superior sales and distribution by itself can create a monopoly, even with no product differentiation. The converse is not true. So she spends the time sales, developing product packaging, products, everything else. Joe was very helpful with managing with the finances. She would spend every last dollar it's a kind of it's not exactly the same but there's a parallel between uh the way walt disney was with his walt disney and his partner was his brother roy i think his brother's roy i'm going off memory so i'm not mistaken but

his brother was the one that you know always had to deal with the financial consequences of walt saying like i'm spending every last dollar on quality. There was an exchange in one of the biographies of Disney. It's fantastic. Where he's just like, what is this going to cost? And he's like, we're innovating. I'll tell you what it costs when we're done. So there's, I don't know.

It just makes me laugh. So my point is Estee had a really strong skill set. And her husband and her partner had a strong skill set in areas where Estee was not as strong by her own admissions. So going back, this whole chapter I'm in, by the way, is all about the importance of word of mouth. She calls it the tell a woman campaign. Nothing happened fast. So think about word of mouth as her base. It's really probably the only distribution channel that makes a durable company.

It does not happen that way. I cried more than I ate. There was constant work, constant attention to detail, lost hours of sleep, worries, heartache. So euphoria and terror is a great way to think about this. We're in the terror part. And there's obviously euphoria mixed in. Friends and this is so wild. Friends and family didn't let a day go by without discouraging us.

Despite all the naysayers. So they're like, Estee, what are you doing this for? Stay home with your son. Despite all the naysayers, there was not a single moment when I ever considered giving up. That was simply not a viable alternative. I had a secret weapon. There were, in those days before television and high gloss advertising, only two key ways to communicate a message quickly. They were the telephone and the telegraph. I had a third. It was potent. Tell a woman. Women were telling women. They were selling my cream before they ever got to my salon. Tell a woman was the word of mouth campaign that launched

Estee Lauder cosmetics. And more about the importance of practice. Every day I touched 50 faces. Okay, so this is what I meant about she talks about product packaging all the time is very important to her in the book on Johnny Ive and Sam, Sam, Sam Walton, I'm looking at my bookshelf right now on Johnny Ive and Steve Jobs, rather, they talk about the amount of detail they both put into the packaging of Apple's products. So this is not nothing like this is something that's bathroom decor. Having obtained sample jars, my research consisted of matching the few colors to which I had narrowed my choices to wall... Oh, this is so crazy. So she got a bunch of sample jars. Now her research says, I'm going to match these colors to which I had narrowed my choices to wallpapers in every guest bathroom I could manage to visit. I would fill my evening purse with a few small sample jars. Every time I went to a friend's home or a restaurant, I'd excuse myself from the company, visit the bathroom, and match my jars against a vast array of wallpapers. This is why Bill says, like, if you're going to compete, like, I'm going to use that line again. Like, if you're faking like i'm gonna use that line again like if you're

faking it and that other they're gonna get smoked there were silver bathrooms purple bathrooms black and white bathrooms brown bathrooms gold bathrooms pink bathrooms red bathrooms which color would look wonderful in any bathroom i deliberated for weeks i spent an inordinate amount of time freshening up people must have been worried about my long absences from the company i knew that women would not buy my cosmetics in garish containers that offended their bathroom decor i wanted them to be proud to display my products the jars had to send a message of luxury and harmony they had to be unique a great package does not copy or study it invents and so this whole time she's just still working in counters she's going to try this is where she breaks through to get how she breaks into sacks fifth avenue and she

does it from the ground up a lot of genius stuff she does in this book this is one example of that this is where she really feels at the beginning of her company and and um so let's go into this my customers asked me repeatedly do you have a counter at sacks fifth avenue where i could charge the answer was no i knew i would soon have to transform that into a solid yes. Saks then and now represents one of the most elegant and finest of shopping places. I resolved to break the rules that sheltered this traditional and exclusive store from experimental merchandisers who would sell their souls to sell from Saks. So that's what you can consider what she is at the time. She's not well known.

And so she says, my name was not exactly known there. The tell a woman campaign had already resulted in hundreds of phone calls from women asking for my product. So this is what I meant about how she breaks in from the ground up. The store was beginning to wonder about me. And it's important that she gets in there because what, I don't know if that that's obviously using the words that she uses because this is a different time where she's describing but the the people that were buying at the beauty salon it had to be an impulse purchase because she could only accept cash credit cards were not you know widely uh widely used at this point but it's you had department stores and other places where if you have an account with them they'll let you charge and you can actually pay later so So that'd be a huge increase in sales for Estee or for anybody that has their products in Saks for that matter.

The store was beginning to wonder about me. The enthusiastic phone calls from my own clients were having an effect. The cosmetic buyer at Saks acceded to my millionth request. Remember, she's a bulldog. She's relentless. He gave me a small order of approximately 800 worth of merchandising check how she responds to this well actually she's going to talk about that first she's talking about getting ready for this we decided to send my own customers

and all the people with charge accounts at sax a small elegant white printed card with gold lettering that read sax fifth avenue is now proud to present the estee lauder line of cosmetics now available at our cosmetics department. Did we have a hundred wonderful treatment products? No, we had four. We only had four products, but they were made of pure gold. Breaking that, this is what I meant, breaking that first mammoth barrier was perhaps the single most exciting moment I have ever known. How crazy that is. Think about how much life experience she had since this time. She's now 79, unbelievably wealthy. Estee Lauder is still a private company. It doesn't go public until after she passes away. She got homes all over the world. She's world famous. And she's saying the most exciting moment she's ever known in her life was an $800 purchase

by Saks Fifth Avenue. Fortunately, our confidence equaled our excitement because we had to have enough faith in our work to invest all of our savings. Our first home base was a former, so this is there, you can think of this like a makeshift manufacturing, I guess a factory, if you want to think about that. Our first home base was a former restaurant on Central Park West. We had to pay six months rent in advance. We swallowed hard and signed. On the restaurant's gas burners, we cooked our creams. We did

everything ourselves. Every bit of work was done by hand, forehands, Joe's and mine. We stayed up all night for nights on end, snatching sleeps and fits and starts. All the people to whom I'd given samples, all the people who had been telling other people, all those people had been telling other people, all the people, all of these people appeared on opening day at Saks Fifth Avenue. In two days, we sold out. The fun was about to start. And with that came the endless work, the endless traveling, the endless streams, rivers, tides, torrents, oceans of words i would utter in praise of the products i knew were the cream of the crop i was a woman with a mission i had to show as many women as i could reach not only how to be beautiful but how to stay beautiful on the way i hoped in my

i hoped in my secret heart to find fame and fortune it was 1946 and so this is the official beginning of Estee Lauder Cosmetics. She is 40 years old. Okay, so now she goes on the road. She started to expand her business as much as she can. She's selling. She's trying to get as many department stores as possible to stock and sell her merchandise. And she tells this great story about never underestimating your customer's desire. And so, well, let's go right to Estee. It was 101 degrees in the shade in downtown San Antonio, Texas. And I was making my first personal appearance at the Estee Lauder

counter in the Frost Brothers department store. Slowly, a woman was making her way towards us. She was short, swarthy, and definitely out of her element she stopped directly in front of the counter then she pointed to one jar and looked up expectantly i was about to assist her when the sales person tapped me on the shoulder not her mrs lauder don't waste your time she's not going to buy anything i know her type oh you can already see where the story's going right i remember whirling. Since when do you know how much money she has in her pocketbook? I asked. So she's actually working with somebody that doesn't speak English and an estate that speaks Spanish.

But again, she goes back. Remember what she said at the beginning of the book? That's just an ancient industry. Every single culture for history forever has been interested in beauty. So she says, I went to work. I'm just going to skip over. She does the cleansing oil, the cream, you know, her basic product demonstration. And then I handed her a mirror.

She stared and stared and then smiled. She couldn't speak English and I couldn't speak Spanish. Still, at that moment, I felt such a bond with that woman as she and I both marveled at the miracles of makeup. You know the ending to this story before I write it. She bought two of everything I used on her face and the next day her relatives did the same. I never forgot her. She symbolized so much for me. Never be patronizing. Never underestimate any woman's desire for beauty. That proud woman embodies my whole philosophy. There's a great story. The note I

left myself on this page is do it yourself, Daniel Ludwig. There's a great story. I think it's founders number 68. It's this book. It's a really hard to find book. Actually, if I'm not mistaken, I paid over $100 for it. And it's called Invisible Billionaire. The biography of Daniel Ludwig. The name is it's a biography of Daniel Ludwig. I can't remember the subtitle, but the name is Invisible Billionaire. And Daniel made billions of dollars without anybody knowing who he was back in like the 60s and 70s and I guess 50s too. And he was in shipping and did all kinds of crazy stuff. But anyways, there's a story in the book I never forgot because even after he was a multi-billionaire, they tell a story. He catches a flight from New York City to Panama.

He goes down to this little, he's thinking about building a refinery down there. Spends the day, goes to like a little shop next to a bay. Gets a fishing line and some heavy lures, if I remember correctly. Measures out the fishing line. Rents a small boat. Spends the entire day putting around the bay, checking to make sure the depths on the nautical chart that his engineers are going to use are accurate. And the reason he did that is because two previous projects, one in the, I don't know how to pronounce it, Aronco River, somewhere in South America,

and in Grand Bahama Island. He had trusted the word of experts saying that he could get his super takers down there. Both cases, one ran aground because it was too heavy and the other had something to do with like not being able to dredge into the limestone. And so what he learned is like sometimes you have to do it yourself. And so he had learned from that mistake because those two mistakes cost him a lot of time and money. And even though he's a multibillionaire at the time, he's flying down and going around in a little boat making sure, OK, I'm going to do it. Estes was using the same tactics very early on i would open each store myself i might have to travel by bus train or donkey but i'd be there for a week to train train the salespeople to set out the merchandise attractively to create their aura so she goes back to the

talking more about the free sample sales technique that she pioneered in the beauty industry. No doubt of myself on this page already talked to you about Claude Hopkins agrees. And there's two podcasts in the archive on Claude Hopkins, if you haven't checked them out. One is scientific advertising, which is the book he wrote that sold 8 million copies. And then I also read his autobiography called My Life in Advertising. I think that's founders number 170. The reason to appear at my counter was the gift to the customer, the free something that would sell everything else. It sounds so simple, doesn't it?

I'd have to agree. It was simple. Most good ideas sparkle in simplicity, so much so that everyone wonders why no one ever did that before. The sample was the most honest way to do business. You could give people a product to try. If they like its quality, they buy it. They haven't been lured in by an advertisement

but they were but convinced by the product itself we took this is what i mentioned earlier we took the money we had planned to use on advertising and invested instead in enough material to give away large quantities of our products it was so simple that our competitors sneered when they heard what we were doing today even the banks are copying us. So now she talks about the single most important trait to have. This is not going to come as a surprise to you. Estee Lauder, Ray Kroc of McDonald's, Steve Jobs, John D. Rockefeller, everybody says the same things, persistence. Business is not something to be lightly tried on, flippantly modeled. It's not a distraction, not an affair, not a momentary fling. Business marries you. You sleep with it,

eat with it, think about it much of your time. It is, in a very real fling. Business marries you. You sleep with it, eat with it, think about it much of your time. It is, in a very real sense, an act of love. If it isn't an act of love, it's merely work and not business. What makes a successful businesswoman? Is it talent? Well, perhaps, although I've known many enormously successful people who were not gifted in any outstanding way, not blessed with a particular talent? Is it then intelligence? Certainly intelligence helps, but it's not necessarily education or the kind of intellectual reasoning needed to graduate

from the Wharton School of Business that are essential. How many of your grandfathers came here from one or another old country and made a mark in America without the language, money, or contacts? What then is the mystical ingredient? It's persistence. It's that certain little spirit that compels you to stick it out just when you're at your most tired. It's that quality that forces you to persevere. Find the route around the stone wall. It's the immovable stubbornness that will not allow you to cave in when everyone says give up. Just before we decided to commit ourselves to cosmetics full-time, our accountant and lawyer

took us out to dinner. They had something grave to tell us. Don't do it, was the advice. The mortality rate in the cosmetics industry is high, and you'll rule the day you invested your savings and your time to do this impossible business. I hate when people give this advice. It's just another way to say, which I think is the worst advice that any human can give to somebody else. Be realistic. Makes me want to vomit. So it says the mortality rate in the cosmetics industry is high. You'll rule the day you invested your savings and your time into this impossible business. Don't do it. We did it. Mark Twain once said something like, keep away from people who try to belittle your ambitions.

Small people always do that, but the really great make you feel that you too can become great. Our first year sales amounted to about $50,000. Expenses ate up just about every dime. No matter, forward. And then Este has another great trait where she takes something that other people see as a disadvantage and flips it to her advantage and so she's talking about the fact that she started her business quote-unquote late which I think that numbers if I'm not mistaken or actually support her like you have it's much more likely for an entrepreneur in their 40s to succeed than it is in like a young person doesn't mean obviously you can't you can't succeed as a young person but this idea that somehow like there's like a window and if the

window closes it's too late i'm pretty sure that the data i've seen on this is the exact opposite and so she takes she flips this uh this trait or this the fact that she was older that some people think oh you have a disadvantage like no you're you're actually mistaken it's an advantage i started late i didn't have the time for waiting, nor I guessed the disposition. By the way, it's never too late to start a business. Women of a certain age are seasoned enough to bypass certain frivolities. You know that word I'm trying to pronounce. Certain temptations. They can focus on their interests more steadily than their youthful counterparts.

It takes a certain tunnel vision, the ability to look directly ahead until the daylight is in sight. Older women are not quite as easily distracted. Women are usually more successful when, believe it or not, they have an advantage of years. And so let's go back to this thing that I've mentioned a couple of times that if you're on the train with her,

you're in the elevator, you're getting a product demonstration. And the note of myself is how many people are willing to put in this type of effort, recruiting customers one by one. In the early days, I spent an endless amount of time riding the rails. The sound of train wheels became background music to my dreams. That's just good writing. As I traveled around the country to be present at each Estee Lauder counter opening, I met women who would one day be my customers. At least I hoped it would be. To that end, I never stopped talking to people. Not ever. So she talks about she sees this woman on the train. You know, I'd love to make up your

face, I told her, and show you a cream that will make it lovely to touch. Oh, no, thank you, she said. Soap and water is just fine for my daily life. Nonsense. She looked at so she does the product demonstration almost against her will, but she looked at herself. She couldn't believe it. I gave her a little bit of everything to take home. She still writes me. How crazy is that? And then this is, she talks about, you know, I talked to everybody in an elevator going on and on to this day. I still receive mail from women. I met all over the world, met, touched, and made up during spontaneous moments. And so she also does this not only with customers, but also with influential people, with people that work in her industry,

people that could be helpful to her. One note left on this page, one word, relentless. To this point, the point was to keep thinking, keep placing the products in the public eye, keep devising new ways of capturing the consumer's attention. During the week I usually spent at an opening promotion, I made it my business never to leave a town without seeing every beauty editor of every magazine and newspaper. I bought them samples, made their faces, gave them beauty advice. I promoted beauty. I made friends. Everywhere I made friends. There is no such, oh, this is fantastic. There is no such thing as bad times, I kept telling myself. There is no such thing as bad business. Business is there if you go after it. Oh, this is a fantastic idea, too. Give your full effort always everywhere. No community was too small for my attention.

My absolute full efforts. I had ridden, for instance, on a bus for six hours to open a small store in Corpus Christi, Texas. The store's clientele was modest in size and economics. No matter. So another thing that Bill talks about in his talk is the fact that you develop peer relationships, not only in your field, but you can also learn from from like fields adjacent to your own. And the way Estee would describe that same idea is never underestimate the value of an ally. Here's an example of that. Never underestimate the value of an ally. So she's talking about somebody she met in the beauty industry that worked for other companies. Her name is Helen Blake. You know, she would say to me quite casually during a phone call, I think you might

give Miss Pope, the merchandise manager from Woodward, a call. I was with her yesterday. She mentioned that I look wonderful. I told her it was due to your cosmetics. And well, I think she'd like to know more about you. At that instant, I would call Miss Pope. If you don't do important things when you think of them, you probably never will and may lose out. Today, they call this networking, the sharing between business colleagues. It is one of the most powerful tools in the business. So in this next, a few pages later in this paragraph, she compares two ideas that I think is fantastic. Relentlessly resourceful, which comes from another Paul Graham essay. I think that's the clearest description of how he would describe the art of entrepreneurship. Relentlessly resourceful and seeing your goal in your mind helps you see it in person.

We've seen that over and over again. Make the most of what you have. I operated full time on that precept. If you can't have everything you think you deserve at the moment, you will do well to surround yourself with symbols of your ideals. In that small office, her very first office, I surrounded myself with touches of the good life, the lovely and intricately tapestried life of my imagination, an imagination that has always been, I'm proud to say, large enough to admit any possibility. So one of the craziest stories I've ever heard in studying the history of entrepreneurship is the fact that Coco Chanel, when she was a young entrepreneur, she mistakenly gave away 90% of her perfume company. Two decades later, she fights to get it back. I covered that. I think

it's Founders No. 199. But anyway, she signs the deal where she gets 2% of all sales of Coco Chanel number five or any perfume, but Coco Chanel number five winds up becoming one of the most successful commercial products of all time. I think she signs the deal in 1947, if I recall correctly, that pays her what she says, okay, I'm going to get 2% of all sales for the rest of my life. And you have to pay every single of my living expenses, large or small, right? One of the craziest deals in history. Makes her the richest woman in the world at the time, if I'm not mistaken. She pays like $25 million a year every year till the day she dies.

If you adjust for, if you translate that contract into today's dollars, that'd be the equivalent if somebody paid you $300 million a year and paid for every single one of your living expenses. So it's insane. So S.A lauder studied the the pioneers in her history industry a lot of which she didn't actually like she has some you know they were there they didn't really get along but she she never says anything bad about coco chanel she quotes her at least twice in this book so she's very aware of her and she doesn't say so but i think that one of s.a's most products, which I'm about to tell you the story of now, is this thing called Youth Dew. And her answer to how I can get more women to buy perfume for themselves is genius, which I'm going to share with you.

But I have a feeling that Coco's success with Chanel No. 5 influenced Estee Lauder. So it says – she's talking about perfume for most parts. Like somebody buys it. It's not something at this point that you'd buy for yourself. It's usually like a gift. So how do I convince women to buy their own perfume? How could I get the American woman to buy her own perfume? I would not call it perfume. I would call it youth do a bath oil that dubbed as a skin perfume that would be acceptable to buy because it was feminine, all American and very girl next door to take baths, wasn't it? And so think about the difference in size of bath oil, how many ounces you would sell compared to the size of like a perfume or cologne. We created a mini revolution in the whole world. As I saw it took on a fresher,

more stimulating aspect. Instead of using their French perfumes by the drop behind the ear, women were using Youth Dew by the bottle in their bath water. It doesn't take a graduate school of business to figure out that that meant sales. Beautiful sales. In 1953, Youth Dew did about $50,000 worth of business for us. In 1984, that figure was over $ million dollars that is just one of her products that is crazy in 1953 53 youtube did 50 000 worth 30 years later it was doing 150 million a year i think the legendary chanel put it best perfume she said is the unseen but unforgettable and ultimate fashion accessory it heralds a woman's arrival and prolongs her departure. Coco has a lot of great quotes. If you're ever interested, just Google Coco Chanel quotes. She was gifted with words.

One of my favorite quotes that she's ever said was, I decided who I wanted to be and that's who I am. And if you know her story, if you listen to that podcast or read her biography, she goes from, I mean, she's dead on. I decided who I wanted to be and that's who I am. She transformed herself from orphan to the richest woman in the world uh so this is a little bit about learning from i'm fast forwarding in the story obviously uh learning from the mistakes of other beauty company founders they're all gone now the people who founded the great companies of beauty only i am left revson was replaced by by this gentleman named michael uh elizabeth arden left her company in turmoil when she died.

So they're all dead. I don't know if I'm being clear. She's describing what happens after the company founders die. So Revson was replaced by this other guy running the company. Elizabeth Arden left her company in turmoil when she died in 1966 without having her set of affairs in order. When Helena Rubinstein died in 1965, Colgate Palmolive took the reins. Charles of the Rich is now owned by Squibb.

Some of these companies I've never heard of. Germaine Montel by Beckham. Max Factor by Beatrice. And this is the reason I'm telling you all this. Don't worry about remembering the names. This is the main point. The personal love and involvement are gone. They're companies now, not a family's heart and soul it won't happen

to estee lauder okay so i need to she's at this point in in the company's history she starts to expand she's just in the united states she's going to expand to europe and then she's going to expand to canada i'm going to tell you great ideas or just crazy ideas about both uh both experiences this is how she does it uh she always shot for the top. So she wanted to be, if she's going to break into a new market, she wanted to be in the very best retailer in that country. In America, she thought that was Saks. In London, she thinks that's Harrods. I would start with the finest store in London, which was Harrods. And if I did that, all the other great stores would follow. So she talks to the buyer. Simply not interested was the unmistakable message.

This is going to take a few years for her to do this. So, okay, no one's not even wanting to talk to me. A little media. So what she's doing. Well, if I'm here, a little media attention was called for. I visited the beauty editors of various magazines. This is in London. She would do the same thing.

Give them gifts. Give advice. Make them up. Okay. Yes, they'd be happy to write a piece about my products. What store in London would be carrying them? My products are not available in London. I had to be my reply.

Well, she answered, I'll write a piece saying that Estee Lauder's cosmetics will be coming soon. Again, I went to Harrods. Again, the answer was no. There was no space at this time. There was no call for my products. This wasn't the right time of year. Maybe another time, et cetera, et cetera. Again, the answer was no. There was no space at this time. There was no call for my products. This wasn't the right time of year, maybe another time, et cetera, et cetera. I stayed in England for a month, visiting every beauty editor to make my name known.

I was getting write ups, but but no Harrods order. It was looking very bleak. The next year I went back to London and Harrods. So now she talks to the same buyers a year later. She was not as quite as hostile, but she says, let me tell you, I have no room here, as I told you before, she said. But perhaps I could take a tiny order and put it in with the general toiletries. It won't be next to the good cosmetics. That you'll have to understand, Ms. Lauder. So she has a tiny order, not in a place she wants. It's not a victory yet. I visited every one of those beauty editors again to remind them of me.

Another round of makeups, another round of samples. Do you think you might write another piece, I asked, now that we're in London at Harrods. The articles appeared. Customers also appeared. I was on my way. Women began. Remember how it's kind of like going up from the from getting getting the demand from like from the ground up. Just how she did with sex. If you think about it, customers also appeared. I was on my way. Women began asking for women began asking for Estee Lauder. That's why I just said what I said to you. The Harrods buyer was reluctant to notice, but she had no choice. In the flush of a good week's sales, I summoned up the courage to ask if she could give me a more important counter. Oh no, she said. Other counter

space is definitely not available. About six months later, I made my third trip to London. Well, we seem to have many London women asking for your products, she grudgingly admitted. I think I'll give you a small spot at a more prestigious counter. And that was how Estee Lauder came to Europe. So this is about how she gets into Canada. She's good. She does everything I'm about to tell you. She did after being told no.

She's talking to the buyer. You need a bath oil, I told him. She said, no, no, no, no, no. Women would love to come into a department store instead of a drug store to buy it. Look, buy it on consignment. If you sell it fine. If you don't, you've lost nothing. Oh, OK, he said. But send me just a few bottles and only the oil. So as I was wrapping the bath oil to send from New York to Canada, I decided to put in a few more creams with a note. Take these on consignment. Also, you certainly wouldn't want to have to say no to any woman who asks if there's anything else in this line, right? And then this

is their response. What about our exclusives with the other company? What about my lack of space? What about, what about, what about? He sputtered when I spoke to him later. Look, you must go with the trend. With the world, I said. Everyone is using this bath oil and these creams in America. You don't have to pay me for them until you sell them. Oh, okay, he said in resignation. When I came to make my personal appearance at the opening of the Estee Lauder in Canada, my sales department sent everything. The bath oil, the cologne, the youth do cream, and so on and so forth, and little boxes of powder I could give away as gifts. We sold out of everything. The buyer came down to see me after three or four days. How did you do it? Never mind how I did it.

I'm sending you more. You don't sell cosmetics, he responded. You sell yourself. We opened in Canada. Now do you see what I mentioned earlier? Like if she could be reincarnated, if she could be brought back, how difficult it would be

just to compete with somebody like this. It's crazy. So her main message of the book though, I would say is be determined and sell. It's something she repeats over and over again. Let's get a little bit into that. It's not enough to have the most wonderful product in the world. You must be able to sell it.

One woman with definitive ideas, pride in her product, and a hands-on approach can lay the foundation of a strong business. Creating the finest perfume in the world is an accomplishment. Making people aware of its existence, let alone getting them to try it, is sometimes harder to do than creating the product in the world is an accomplishment making people aware of its existence let alone getting them to try it is sometimes harder to do than creating the product in the first place and so this is what uh this again um is her obsession her ongoing obsession uh with the quality of her products packaging and where she feels and she actually makes a really good point here about okay selling is probably,

and getting them to try it is probably even harder than making it, right? And so she gets the packaging as a way to induce them to try it. The whole process is simplified. If the perfume is offered in a spectacular egg, she's talking about the packaging of this particular product, that looked as if it had been wrought in the workshop of Peter Carl Fabergé. So think what a Fabergé egg looks like, okay? Packaging in no way, and this is the reason behind her thinking behind this,

I should say. Packaging in no way dupes the customer or enhances the integrity of the product. If the product is disappointing, the customer will keep the container, which costs a considerable sum to make, and never return for more perfume, no matter what it comes in. If the product is excellent the customer

will buy it again and even faster if it comes in yet another wonderful package that delights the eye both have to be the best the product and the package so this is also something that you and i have talked about that everybody has to develop their own philosophy on business it should match you and it should be unique to you. She's giving you the same advice. Each business person must find a style, that voice that grows clearer and louder with each success and failure. Observing your own and your competitors' successes and failures makes your inner business voice more sure and vivid. During the acquisition binges of the 1970s, we saw business firms becoming conglomerates. There was pressure for us to do the same.

The lauder inner voice said no. Stick to what you know best and don't change it lightly. Today, the same firms are spinning off the subsidiaries because they weakened instead of strengthened their original product. Another way to think about this, they lost their focus, right? The voice grows stronger with each success, each observed failure. All one has to do is listen and watch. Business is a magnificent obsession. I've never been bored a day in my life, partly because of a true bit, partly because as a true business addict, it's never been enough to have steady work. I had to love what I was doing. And this next sentence that Estee is about to tell us is a main point in Bill Gurley's talk, Running Down a Dream, which I hope I can convince you to watch. Love your career or find another. Soup, glue, or beauty can all be packaged

in jars, tubes, and bottles and vended like any other commodity. The big difference lies in the vendor, you, not the items to be vended. Even excellent glues, soups, and beauty products can die in the marketplace if the vendor isn't passionate and clever. Develop your style. Our unique style has come from years of trial and error. Truths have emerged that work for us. Let me share them with you. And so that's what the entire book is about.

She calls these maxims lauderisms, but our style came from years of trial and error. Truths have emerged that work for us. Again, somebody spent 50 years of their life studying, being obsessed about their business, about their craft. They put down their best ideas and their worst mistakes, and most people won't even bother to pick up the book. Let's go back to Morgan Freeman. You can see the scene. Just Google's go back to Morgan Freeman. And you can see the scene. Just Google seven library scene,

Morgan Freeman. I've watched it on YouTube several times. Gentlemen, I'll never understand you. All these books, the world of knowledge at your fingertips. And what do you do? You play poker all night. A couple of lauderisms.

There's a bunch. Obviously, pick up the book if you want to read all of them. Keep your image straight in your mind. From the beginning, I never, excuse me, I knew I wanted to sell the top of the line, finest quality products to the best outlets rather than through drugstores and discount stores. And so we have.

We don't do dungarees. We don't do tablecloths. We do the best skin products available today, the best makeup and fragrance products. Another one, keep an eye on the competition. This doesn't mean copying them, as I've made clear. Being interested in other people's ideas for the purpose of saying we can do it better is not copying. Innovation doesn't mean inventing the wheel each time. Innovation can mean a whole new way of looking at old things.

She's going to say, learn to say no. Steve Jobs has told us focus is saying no. Saying yes all the time stems from a childish desire to please and be loved by all the time. Executives must say no to inferior products and ideas. Trust your instincts. I've discovered that pondering facts and other people's judgments usually leads me down the wrong path. Common sense. Instinct. Trust that part of yourself. Whatever you call it. Another lotterism. Act tough. What other calls tough i call persistent if you know you're correct you must be firm and not bow to pressure too often women are taught as little

girls that sweetness is more valuable than persistence or stubbornness little boys on the other hand are taught to win persistence and being tough can make for success i can't count the number of little plaques that Ronald, that's one of her sons, has given out that read, it can be done. I agree. Anything can be done if you're certain it's right and you stay firm. I want to bring this up because she mentions it multiple times and I've seen it in a lot of these biographies. The power of visualization. This is the idea that seeing it in your mind helps you see it in person. Bob Noyce, founder of Intel. Edwin Land, Polaroid. Steve Jobs did this.

Arnold Schwarzenegger, Estee Lauder. They all did this. Edwin Land and Steve Jobs. There's a famous story that John Scully talks about where they go to meet. This is in the 1980s. Steve Jobs is obsessed with Edwin Land. He winds up being his hero. That's why I've done five.

I've read five. No, I've read six books on Edwin Land. I've done five i've read five no i've read six books on edwin land i've done five podcasts on him uh one of those podcasts has two books but anyways uh they tell the story about edwin lands in his 70s at this point steve jobs is what he's got to be 20 maybe maybe 30 something late 20s somewhere around there uh and so they both tell the story of seeing their in their mind the full the fully formed version of their product and then working backwards from that and just galvanizing their entire organization the scientists engineers designers everybody in their organization to get as close to that image they had in their mind with as few compromises as possible. It's a very fascinating story.

So anyways, this is Este. Visualize. If in your mind's eyes you see a successful venture, a deal made, a profit accomplished, it has a superb chance of actually happening. Projecting your mind into a successful situation is the most powerful means to achieve goals. If you spend time with pictures of failure in your mind,

you will orchestrate failure. Countless times before the event, is the most powerful means to achieve goals. If you spend time with pictures of failure in your mind, you will orchestrate failure. Countless times before the event, I have pictured a heroic sale to a large department store every step of the way, and the picture in my mind became a reality. I visualized success, then created the reality from that image. Great athletes, business people, inventors, and achievers from all walks of life seem to know this secret.

And then this is, uh, the hard work is all worth it. Imagine how good this would feel. Sometimes I have to pinch myself to believe what hard work and prayer have brought me. They've taken me from carrying a tiny bottle of cream in my purse on the off chance I'd meet a woman who needed a quick lift, uh, to seeing a streamlined white streak as I drive along the Long Island Expressway,

33 miles due east of Manhattan. That streak is my factory. And as my car approaches, my name gets larger and larger. It is a thrill that will never diminish for me. My name, not in lights as the little girl from Queens dreaming of being an actress hoped to see, but my name on a working monument to beauty. And then this is Este once again on the importance of wishes, dreams, and victories. First comes the wish. Then you must have the heart to have the dream. Then you work and work.

From where you sit, you can probably reach out with comparative ease and touch a life of serenity and peace. You can wait for things to happen and not get too sad when they don't. That's fine for some, but not for me. Serenity is pleasant, but it lacks the ecstasy of achievement. I've insisted on the long stretch rather than the gentle reach. I celebrate this sweet country where the work ethic and the beauty ethic walk hand in hand. Living the American dream has been intense, difficult work, but I couldn't have hoped for a more satisfying life. I believe that potential is unlimited. Success

depends on daring to act on dreams. How far do you want to go? Go the distance. Within each person is the potential to build an empire of her wishes and don't allow anyone to say you can't have it all. You can. You can have it all if you're willing to work. I always believe that if you stick to a thought and carefully avoid distraction along the way, you can fulfill a dream. My whole life has been about fulfilling dreams. I kept my eye on the target. Whatever that target was, I never allowed my eye to leave the particular target of the moment. Whatever your target is, big or small, grand or simple, ambitious or personal, I've always believed that success comes from not letting your eyes stray from that target. Anyone who wants to achieve a dream must stay strong, focused, and steady. She must expect and demand perfection and never settle for mediocrity. If you push yourself beyond the

furthest place you think you can go, you'll be able to achieve your heart's dream. And that is where I'll leave it for For the full story, pick up the book. It's really hard to find. Sometimes it's sold out. I've seen it on sale for over like $500 before, which is crazy. But I'll leave a link if you buy the book using the link.

If you can find the book using that link, you'll be supporting the podcast at the same time. So if you're interested in that, the links are always down there below. I will also leave links to that talk. Really think it's worth, I highly recommend spending an hour listening to it. I think you'll enjoy it.

That is where we're at. 217 books down, 1,000 to go. And I'll talk to you again soon.