Founders - #56 The Biography of Herb Kelleher

Episode Date: January 22, 2019

What I learned from reading Nuts!: Southwest Airlines' Crazy Recipe for Business and Personal Success----Reality is chaotic; planning is ordered [0:01]Vince Lombardi is the Steve Jobs of coaches [3:48] how Southwest Airlines is different [11:31]the beginning of Southwest [16:00]fighting anticompetitive practice [24:30] finding a new market by doing the opposite of your competition [29:00] missionaries make the best products [31:00]being forced to innovate leads to questioning assumptions which leads to finding new markets [34:00]how Southwest became the largest liquor distributor in Texas [38:00] remember your fundamental reason for being and don't deviate from that [40:45]optimize for profits, not market share [42:30]know what you are competing with - not who [44:15] how having only one type of airplane gives Southwest an advantage [46:30] how keeping it simple saved Southwest $2 million [51:30]know what you do best - have the discipline to stick to it [53:00] if you are going to be small you have to be fast [1:01:19]the benefits of curiosity are unpredictable [1:03:45] ----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

One plan, no matter how well laid, couldn't possibly respond to all of these situations. This is why Keller does not put much stock in traditional strategic planning. His concern is that writing something down in a plan makes it gospel. When the plan becomes gospel, it's easy for people to become rigid in their thinking and less open to new, perhaps off-the-wall ideas. Keller explains it this way, reality is chaotic, planning is ordered and logical. The two don't square well with one another. When USAir pulls out of six cities in California, they don't

call me and tell me they're going to do that. Now if we have established a big strategic plan that is approved by our officers and the board of directors, I would have to go to the officers and the board and tell them that we want to deviate from this plan. They would want to know why I want to buy six more airplanes. The problem is we'd analyze it and debate its merits for three months instead of getting the airplanes, taking over the gates, and dominating California. The meticulous nitpicking that goes on in most strategic planning processes creates a mental straitjacket that becomes disabling in an industry where things change radically from one day to the next. When a financial analyst chided Keller about not having

a strategic plan, he said, we do have a plan. When she asked what it was, his response was vintage Keller. It's called doing things. Okay, so that is from the book that I want to talk to you about today, which is Nuts, Southwest Airlines' Crazy Recipe for Business and Personal Success. So I wasn't planning on doing this book anytime soon. It kind of jumped ahead in my queue because a few weeks ago, Herb Keller, the founder of Southwest Airlines, just passed away. And he's one of the most fascinating people that I've ever heard give an interview. And this book, although not a biography of Herb, he worked closely with the authors. It was published in the early 1990s.

And it just gives us a good idea of how he thinks about business, which I think is the core of what we're trying to get to on this podcast. Before we begin, jump into the podcast, though. I do want to share a quick story from another book that I'm currently reading. I've been immersed in the mind of Steve Jobs lately. So I've read two more books about Apple in the past two weeks. And I'm also in the middle of taking notes on all of Steve Jobs appearances at the All Things D conference. And the story that I want to talk to you about real quick, it comes from the book Creative Selection, Inside Apple's Design Process During the

Golden Age of Steve Jobs. And the author of this book is actually the programmer that worked on creating the Safari browser and the keyboard software for the first iPhone. So the context of the story that I'm going to read to you is what Steve's, basically Steve Jobs was giving direction to the creation of Safari. At this point, we're talking early 2000s, they were, Internet Explorer was the browser on the Mac, and he wanted to create his own browser. And what I found fascinating is when he was giving the direction to the team, he had them focus on one thing and one thing only. And in the terms of creating Safari,

that one thing was speed. And so let me go ahead and go to the book and read you the story. So the author is actually going to be telling a story, but he's using it as a metaphor. So he's talking about one of the most famous football coaches of all time, Vince Lombardi. And you're going to see how he ties this together and compares Vince and Steve in the context of how they were creating Safari at the time. So it says, when Lombardi joined the Green Bay Packers in 1959, the team had gone 11 straight seasons without a winning record. And after winning only one of 12 games the previous year. Upon arriving at training camp as their new head coach, Lombardi made an immediate and indelible first impression. So he gathers all of his players in one room and he's giving them a speech and he's doing it in

front of a blackboard he's he picked up a piece of chalk and began to speak now this direct quote from Lombardi gentlemen he said we have a great deal of ground to cover we're going to do things a lot differently than we've been then have been done here before. We're going to relentlessly chase perfection, knowing full well we will not catch it because perfection is not attainable. But we are going to relentlessly chase it because in that process, we will catch excellence. He paused and stared, his eyes moving from player to player.

The room was silent. I'm not remotely interested in being just good. Lombardi soon followed up with a clear-cut description of the specific thing they would perfect. One play. One single running play. Gentlemen, this is the most important play we have. It's the play we must make go. It's the play that we will make go. It's the play that we will run again and again and again. That one play is called the power sweep. John Madden described attending a coaching clinic where Lombardi talked about the power sweep and only the power sweep for eight hours. Through practice after practice, drill after drill, game after game, and season after season, the Packers honed and refined Lombardi's power sweep.

Even though opposing teams knew the play was coming, they couldn't stop it. Lombardi built his victories on an openly declared challenge. To beat the Packers, you must beat the power sweep. Over the following seven years, the Packers won five championships, including victories in the first two Super Bowls. A step-by-step, year-by-year progression through the ranks from worst to best to legends, all built on the foundations of one humble running play, initially described on the blackboard and then executed exquisitely on the field over and over again. In any complex effort, communicating a well-articulated vision of what you're trying to do

is the starting point for figuring out how to do it. It may seem like a stretch to draw a comparison between winning football games in Green Bay and developing web browser software in Cupertino. But a significant part of attaining excellence in any field is closing the gap between the accidental and intentional. To achieve not just a something or even an everything, but a specific and well-chosen thing, to take words and turn them into a vision, and then use the vision to spur the actions that create the results.

Vince Lombardi was the Steve Jobs of football coaches. Okay, so I wanted to tell you that story because as I've been studying Steve Jobs, I realized I wasn't even applying the lessons I was learning and specifically on how to support this podcast. And when I went back and looked at show notes and then even listened to some past podcasts, I realized there were too many options. I was doing too many things instead of focusing on the one thing that I think I do best. It was way more confusing than it needed to be. So now, just to give you an update, I did what Steve Jobs would do. I reduced all the unnecessary options and only focused on

the one best thing. As we get into this book on Herb Keller, you're going to see that he's also obsessed with simplifying and focusing on what you could do best. So since this podcast is ad-free and independent, I rely on the support of the people who get value from my work. And I was giving you several different options on how to support the work, and I realized I need to pick the best one. So moving forward, if you commit to supporting this podcast on a monthly basis, you'll get access to all of my podcast notes from 125 plus founders and new notes as I was doing those podcasts, and I did 20 of them,

that the best podcasts I was able to do are the podcasts that you guys get to listen to ad free, the ones that are on this main feed that you're listening to. And I was struggling trying to come up with different topics or reading extra books. And I realized this is a lot of wasted effort. My focus should be on making my main podcast

the best it could possibly be, instead of spending a few hours, even five or ten hours a week, doing an extra podcast feed that's just not as good as the main podcast feed or the work I'm doing with Founders Notes. I know this podcast is good based on the feedback I'm getting from you guys. And I know the Founders Notes is really good because I'm taking key ideas from podcasts with other founders and delivering them to your email inbox, which saves a lot of time because what we're doing is we're taking a founder could be building a company for several

years. They go on a podcast. They distill their best ideas, what they've learned from years of experience, and then I take note of those ideas and email them to you. There's a great value in doing that. So moving forward, if you want to support this podcast, if you want to say, hey, I like the work you're doing, David, and I want to see it continue, all you have to do is tap the one link that I have in the description that's on your podcast player, or you can go to founderspodcast.com and you can see it there, but it's easier if you're

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All right, so let's get into the podcast, today's podcast, which means let's get into the rest of this book. So I'm just going to breeze through like normal. If this is your first time listening to Founders Podcast, usually I read biographies or autobiographies of founders, just my way of kind of documenting the history of entrepreneurship. Today is a book that's actually written about the actual processes of inside Southwest Airlines, most of which come from Herb Keller. And so that's what I'm going to focus on today.

It's not meant to be a review and it's definitely not a summary of the book. It's just ideas that I found, highlights that I made that I thought were interesting, and I wanted to share them with you. Okay, so let's start right at the beginning in the first chapter. This is just a quick outline of how Southwest is different. And to outline how they're different, they're going to compare and contrast Southwest to other airlines. This eccentric and outlandish company has established a consistent pattern of deviating from convention. When other airlines were creating big hubs, Southwest was flying point to point. Instead of serving expensive meals, flight attendants pass out nuts.

Instead of wearing stuffy uniforms, they sport polo shirts and shorts. From these departures from convention and from many others, the world has become fascinated with the zany people whose irrepressible enthusiasm comes from the desire to make their lives and their company extraordinary. Convention is boring. Nuts are exciting. In an industry that is still reeling from the $12.8 billion loss that posted between 1990 and 1994, Southwest was the only airline to be profitable each year during that period. During this time, the airline industry lost more money than it had made in the previous 60 years. Southwest Airlines is the only U.S. airline to earn a profit every year since 1973. So again, this book is 25 years old or something like that. As of the last I checked, Southwest has been profitable every year for 43 straight years. And a lot of that has to do with

a lot of the ideas that are in this book. And we're actually going to get to Herb's own words about the importance of prioritizing profitability over almost everything else later on. So it says, one way they achieve this, they have a conservative balance sheet. So it says, airline debt has recently reached astronomical and unsustainable levels, more than $35 billion in debt as of 1996. Southwest has maintained a conservative amount of debt in the industry that is very capital intensive. Our target is to do at least 50% of our capital spending with internally generated funds.

So I want to pull up something on my computer as I talk to you guys, because I recently took notes. For those of you that are already on the Founders Notes, you already know this. Herb Keller, a few years ago, was on the podcast, How I Built This. And he specifically talks about this strategy. And I want to read to you what he said. I'm going to read this direct quote from Herb. So he says, we may be flamboyant from a marketing perspective, and they certainly are, and we'll get to that in the book, but we were very, very conservative from a fiscal standpoint.

And so you could argue that Herb is advocating for frugality, which is a very common theme on a lot of the founders that we've covered on the podcast so far. And he says, we paid for 100% of our airplanes from revenue. This means you aren't taking on debt. When there are bad times, you aren't threatened by debt payments. So one thing about Herb is he was a voracious reader, and he was a student of history.

And one of the benefits of studying history is the fact that the quote I always share on the podcast is, hey, listen, history doesn't repeat, but human nature does. Herb went back and studied the history of the airline industry before he started an airline. And the time he spent studying the history of the industry that he wanted to be in led him to use this tactic. And this is the reason why. He says, debt payments put other airlines in and out of bankruptcy forever. Now, you compare and contrast that to Southwest Airlines being profitable for every single for every year for 43 years. I would argue profitability is probably the exact opposite of bankruptcy.

Just a side note in case my voice sounds different. I lost my voice last week. My little daughter has the flu, unfortunately, so I'm not 100%. So that's why I might sound a little different. I just didn't want to continue to wait and delay getting this podcast out. Okay, so let's go back to the book. And we're going to skip ahead a little bit. And we're going to learn a little bit more about Herb's personality.

Anyone who's ever met Herb Keller will tell you that whether he's talking to a U.S. Supreme Court justice, which he had to do to get Southwest Airlines off the ground, a member of his board of directors, or a hotel valet, he displays the same level of genuine interest and intensity. He's there and he's engaged regardless of whom he's talking to. Okay, so now I'm skipping to the next chapter of the book. And now we're actually going to go back in time. This is always the most fascinating part to me is the beginning of the business. Like what were the conditions? How did you come up with the idea?

Why did you feel the need to do it? And then how did you get from starting a business to running a successful business? So this is the history of Southwest Airlines. The history of Southwest Airlines is a story of courage and perseverance. It is the tale of a group of pioneers who beat incredible odds to realize their vision. No carrier in the history of the U.S. airline industry has survived quite the dramatic struggle that Southwest went through trying to get off the ground. The company's character is rooted in its legendary beginnings. Southwest Airlines was a brainchild of Roland King, a San Antonio entrepreneur who owned a

small commuter air service, and his banker, John Parker. Parker had complained to King that it was inconvenient and inexpensive to travel between Houston, Dallas, and San Antonio, and suggested starting an intrastate airline. Before reading this book I didn't even know there was such a thing as an intrastate airline. In late 1966 King marched into Herb Keller's San Antonio law office. So Herb Keller, the first business he ever started, was his own law firm. King is one of his clients. So he marched into Herb's office with a business he ever started, was his own law firm. King is one of his clients. So he marched into Herb's office with a feasibility study and a grandiose idea of starting a new airline,

using larger planes to serve these three major cities in Texas. Keller, a New Jersey native and graduate of New York University School of Law, had moved to San Antonio with his wife to continue his law practice, and he had done legal work for King's Air Service. While pitching his dream, King pointed out that the Golden Triangle of Texas, so that's the distance between Dallas and the north, San Antonio in the west, and Houston in the east. So it says, pointing Golden Triangle of Texas, was perfect for this kind of service he envisioned. Houston, Dallas, and San Antonio were experiencing rapid economic and population growth. And they were also far enough apart to make travel by bus or automobile inconvenient.

So remember this part. They were also far enough to make travel by bus or automobile inconvenient. Herb makes a really good point that most companies, later in the book, that most companies don't even understand who they're truly competing with. And it's usually not the competitors in their industry. And I'll get there in a minute, or in a little bit. Keller initially thought this idea was crazy, but he's intrigued enough to discuss it with King over cocktails. Okay, something else that you need to know about Herb Keller. His lifestyle basically goes against everything people think about healthy living, yet he lived to 87. What do I mean by that?

He smoked cigarettes every day. He drank a lot. He drank whiskey or bourbon, excuse me, wild turkey bourbon, I think was his drink of choice. And his breakfast, let me consult my notes to make sure i have this correct were uh cheese crackers every day so uh this guy's insane all right and he worked like 100 hours weeks so basically everything they tell you not to do king had studied another interstate carrier pacific southwest uh pacific southwest airlines in california it was the perfect model psa was a successful interstate airline operating in a state much like Texas, one that was commercially booming with cities

far enough apart to make air travel an attractive alternative to cars and buses. He had also talked with and involved the founders of another interstate airline, Air California. The success of these two carriers made it seem likely that King's idea would work. So King is just doing some smart things here. He's analyzing the history of the industry he wants to go to, and he's learning from other founders. So this is what, so Keller's like, all right,

you know what, over some cocktails, I'll do this. Let's do it. And they actually write out the business plan on a cocktail napkin, and it is hanging in Southwest Airlines headquarters to this day. So this is Keller talking. We initially figured we needed around $250,000, but we doubled it because I was aware that there was going to be a fight, and it was going to be a prolonged fight. But it turned out to be a much longer vendetta than I had anticipated. So what he's talking about there is that they're going to go through a four-and-a-half-year battle between the time that they start Southwest Airlines before they can take their first flight,

and it has to do with direct anti-competitive behavior from the local airlines in Texas. So it says on November 27, 1967, Keller filed Southwest's application to fly between Dallas, Houston, and San Antonio. So it's on February 20th, 1968. There's this governing body who they're regulated by. It's called the TAC, which is Texas Aeronautics Commissions, approved Southwest's application to fly between these three cities. In doing so, it unwittingly started a war that would last more than three years, actually last four and a half, severely test Herb Keller's litigation skills, and almost drive Southwest Airlines out of business before it put a plane in the air. Remember, they're talking about at the beginning of the chapter said, hey, the struggle, the dramatic struggle for Southwest to even exist is kind of at its root of its culture to this day. So it says, the day after the TAC voted unanimously to approve Southwest's application,

Braniff, which is another airline, doesn't exist anymore. Trans Texas also doesn't exist anymore. And Continental aimed their first blow at this little upstart they filed a temporary restraining order to that prohibited the tac from issuing southwest's certificate to fly so i'm as i've talked about multiple times on this podcast i am very much a favor of capitalism i cannot stand crony capitalism like this uh where you instead of making the the best outcome for the consumer and doing it in an above-board way, they're trying to say, hey, we don't want the consumer to have additional options.

So they go through some completely disgusting behavior here, and our hero in the story, Herb, just probably the wrong person you want to mess with. So this is Braniff continental and texas international argued that the markets southwest wanted to serve were already saturated that there was no other room for another carrier yeah what other business is not going to make that same argument that's a ridiculous argument so now they're in a legal fight well herb keller is an attorney so so the trial court court ruled that the Houston, and San Antonio were adequately served by existing carriers. So they lose their first fight.

That the city Southwest proposed to enter could not support a new carrier. Okay, so now you have a court agreeing with these guys. This is ridiculous. This is what's happening in the supposedly free market. It took seven months for Southwest appeal to make it it to the State Court of Civil Appeals. The appellate court upheld the trial court's ruling. The members, so they lost twice now. The members of Southwest's board of directors

were growing tired and frustrated. And this is one of the, you know, gives you a good idea of who Herb Keller was as a person. While the board generally agreed that the idea was a good one, some members thought it would be wise to cut their losses. So they said, okay, let's just go ahead and give back the investor money. Let's just close up shop. We're not going to do this. At this point, Keller's street fighting spirit surfaced.

Gentlemen, let's go one more round with them. I will continue to represent the company in court and I'll postpone any legal fees and pay every cent of the court costs out of my own pocket. After much debate, the directors agreed to bet on Keller and give it one more shot. Keller argued Southwest's case before the Texas Supreme Court, which overturned the lower appellate court's decision. Southwest would get its certificate to fly. So in an environment where everybody else wanted to give up, Keller's saying, no, no, I'll do this on my own time. I won't charge the company any fees for my time. I'll pay all the legal fees, like the court costs, everything else out of my

own pocket. And he's doing this, by the way, while he's running his business still. He's still running his law firm. So that gives you an idea. And it's good that he didn't quit because as we see, the Supreme Court actually agreed with him. Like, you can't do this. So going back to my notes that I took on that podcast where he talks a little bit about this, he's like, listen, I did this because I was idealistic about it. He said if other airlines could prevent Southwest Airlines from starting, then that means that the free market system is failing. And one of the things that motivated me was to validate the free enterprise system.

And another reason was it was very hot competition and I like to win. Okay, so the Supreme Court says you can fly. Now, what Southwest has to do is they do an IPO, which I don't even know how you do an IPO before you're really in business. But they set up an IPO. But the anti-competitive practices from the same group that was suing Southwest and trying to keep them on the ground continued. And you're going to read about it here. So Braniff was one of the airlines. Braniff also put pressure on some of Southwest's underwriters

to withdraw from Southwest's initial public offering. Through an acquaintance, so I'm going to use the word muse here. This is this guy named Lamar Muse, who Herb hired to run southwest airlines as a ceo this guy also he has a lot of good ideas but he leaves southwest like a few years later starts muse airlines almost goes bankrupt and when he's on the precipice of bankruptcy uh southwest buys buys the airline takes all his assets all right says muse managed to find another brokerage firm to take a larger share and southwest's first public stock was sold on June 8, 1971.

Two days, so this is the IPO before they have their first flight. Two days before Southwest's inaugural flight, Keller learned that the two carriers had launched yet another attack to keep Southwest grounded. They had secured a restraining order in joining southwest from initiating service keller went straight to the law library in the nearby attorney general's office well before he does that he uh went to the judge the supreme court judge he's like listen you last year you wrote a opinion in favor of southwest please throw this this out. And so he has to, the judge is like, you have to find like some, some, um, like some prior, like this happening before. So I actually have something to stand on that. I'm just, so I'll do this for you, but you have to basically help me

out. So it says Keller went straight to the law library and the nearby attorney general's office and worked all night to decide how to proceed and prepare the necessary papers so he found a way to do this going through uh like the history of texas state law and this is uh a quote a direct quote from herb he says i think it had been the the procedure he used he goes i think it had been done once before in the history of texas the texas supreme court ruled in southwest favor and ordered the lower court judge not to enforce the injunction. Keller telephoned Mews and told him to put the planes in the air. When Mews confided that he was still concerned about the sheriff showing up to enforce the injunction, Keller didn't mince any words.

I told Lamar, you roll right over that son of a bitch and leave our tire tracks on his uniform if you have to. The very next day, June 18, 1971, Southwest Airlines was finally off the ground. Let me just skip a couple pages real quick. And it says, so then a few, let's see, what is the time period? A few years later, he was actually vindicated. On February 14, 1975, Braniff and Texas International, these are the guys who tried to do the restraining order, were indicted by the U.S. government for conspiring to put Southwest out of business and violating the Sherman Antitrust Act. So you see that passion in the language that Herb is using is because what they were doing was illegal

and they didn't care and her wasn't the kind of guy that's going to back down from a fight okay so now let's get into some specific tactics southwest used uses to get uh to gain advantages in a very highly competitive market they just said hey not only is there tons of other airlines but the airline industry in the whole is just a really crappy, you know, from an economic perspective, they make small profits. And then you have like some kind of economic crisis or fuel cost increase or whatever the case is.

And you can wipe off, it's very similar to like the banking industry. And then you can wipe off in a few months or in a few days, you can wipe out, you know out 60 years of prior profits. So how is Southwest not only profitable, but how do they not go into bankruptcy? So it says something they do that's really smart at the very beginning of Southwest. They're still bleeding a lot of money. This is before they start turning profitable.

It says Southwest was bleeding money. One of the biggest breakthroughs came when Southwest began service to Houston's Hobby Airport. So the note of myself is finding a new market by doing the opposite of your competitors. All of the major carriers had vacated the Hobby Airport in 1969. But Hobby was close to downtown and perfectly suited to Southwest's short haul, frequent frequent-flying business passengers. But no one knew whether people would use an airport served by only one carrier. So there's a few things going on here. One, they're finding a new market by looking where other people have already given up on.

Two, they know who's using Southwest. What kind of person is going to fly during the week from Houston to Dallas or Houston to San Antonio? The kind of person that has business there but wants to be home for dinner to be with their kids. So they realize, hey, if a lot of our business people that are business passengers and their business is taking them into downtown, why are we flying them to an airport that's 30 miles further? It's adding more time that they don't have. And we're only doing this because that's where all the other airlines are. Well, here's this other airport over here that's closer to their actual end destination. Let's just give this a shot. And the result was spectacular. Almost overnight, the passenger load factor doubled. So it says,

you appreciate more where you have to struggle to get. Missionaries make the best products. And that note I left myself is actually a quote, one of my favorite quotes of Jeff Bezos and something I believe in a hundred percent. And it's part of the reason I'm doing this podcast. Let me just grab the quote real quick so I don't destroy it. And let's see. And here's Jeff Bezos talking. I strongly believe that missionaries make better products. They care more. For a missionary, it's not just about the business. There has to be a business, and the business has to make sense, meaning it needs to make a profit.

But that's not why you do it. You do it because you have something meaningful that motivates you. I think that's the holy grail for entrepreneurship. If we can find a business that we're actually, we have a missionary zeal to. Something that was on Founders Notes this week, and it's gonna, I just ordered his biography. It's actually arriving at my house today. John Bogle, the founder of Vanguard, just recently died.

He was in his late 80s, if I'm not mistaken, maybe 89 years old, something like that. And he made the point, he was on a podcast in 2016 that I was taking notes on because I find the guy unbelievably fascinating. And he's like, listen, it's very hard to compete with Vanguard because we have a missionary zeal. We're telling you that index funds are the way to go, that most of the finance industry is just a ripoff, that the active managed funds underperform the Vanguard index fund and they charge you 20 or 30x the expenses. And his point is like, how are you going to compete with somebody where like Fidelity

just jumped into this business, but they had to be pulled in kicking and screaming after we already had a couple trillion dollars of assets under management. Meanwhile, I've been saying this since the 1970s that this is the way to go. So I like that term he used, missionary zeal. I like that a lot. And so Herb definitely has that in him. So it says that the seemingly insurmountable obstacles thrown at Southwest are what created Keller's passionate love for the airline.

They would put 12 – this is hilarious. They would put 12 to 15 lawyers on a case. And so picture this in the courtroom. And on our side, there was just Herb. They almost wore him down to the ground. But the more arrogant they were, the more determined Herb got that this airline was going to go into the air and stay there. So Herb had a missionary zeal for competition. He thought consumers should have more choice, not less choices.

And he didn't like people with big pockets and 15 lawyers trying to pick on a new startup. All right. So this says, being forced to innovate leads to questioning assumptions, which leads to finding new markets. Okay. So Southwest has always been known as a maverick and an innovator in the U.S. airline industry. The company's creative roots go back to the early days when employees came up with clever ideas for keeping the business alive

because Southwest had no choice but to become inventive in order to compete with established carriers. That's basically the story of any new small company ever. The company simply didn't have the money to go head to head with the majors. Southwest would have to outthink and outmaneuver. Before Southwest capitalized on the idea of offering permanent low fares, the US airline industry as a whole charged the uniformly high fares approved by the cab i think the cab is a civil aeronautics bureau but i could i could have that wrong it's the regulator for federal airlines the airlines operated as

though there were only two market segments those who could afford to afford to fly and those who couldn't this assumption guided the operating strategy of the major carriers when problems arose arose or costs went up, they would simply raise fares. So they'd ask the regulatory board, hey, this is too expensive. We need to raise fares. The CAB would comply and then the price would go up. They basically ignored an entire market. So Southwest is like, hey, if we can lower the price, people are not flying because they don't want to. They want to get places faster. They just can't afford it. So why don't we focus on making it more affordable and we'll open up this giant new market, which is

really smart. So it says Southwest, believing that it could stimulate a tremendous amount of new travel with low fares and superior service, challenged this assumption from day one. So of course, they wound up being proven correct from day one southwest challenged the assumption that permanently reduced fares would cut revenue they cut their fares and goes up and we're going to see this and this is an example of benefiting of trial and error like many of its innovations southwest two-tier fare system so this is interesting i didn't know that this didn't exist before so let me try to describe this hopefully it makes sense to you so it says uh like many of its innovations southwest two-tier fare system was not the outcome of a sophisticated long-range planning retreat.

It was the result of good old-fashioned trial and error. So they realized that there's really two types of travelers that an airline had to satisfy if it was to cover the entire market spectrum. The convenience-oriented business traveler, who was more time than price sensitive and wanted lots of business hour flights, so time is more important, that's why moving to the hobby airport wound up being so beneficial to them. And then the price sensitive leisure traveler,

who primarily wanted lower fares and had more flexibility about when to fly. So if your time is more important, you want more flights during business hours, you'll also be willing to pay higher fares, what Southwest hypothesized. Meanwhile, that if you're trying to travel for leisure, that's not being paid by a company, it's being paid by your own self. So you're going to be way more price sensitive so this is what they come up with they in they introduce a system-wide two-tier fare structure in which all seats on executive class flights departing on weekdays until 7 p.m were sold for 26 dollars so that didn't go up and down it's like this is the 26 today it's 26 tomorrow $26 tomorrow. But here's the thing.

This is actually going to generate them more money because this was a 30% increase over Southwest's original $20 fare. So instead of paying, we're going to give you more flexibility and more convenient times. But instead of paying $20, you're going to have to pay $26. Well, if you're not price sensitive but you're time sensitive, you're going to do that. And all seats on pleasure class flights departing after 7 p.m. on weekdays and all day Saturday and Sunday, the times when people are actually traveling for leisure, are going to be sold for $13, which is a 35% decrease from the $20 fare. So now they're moving in the opposite direction. Passenger traffic skyrocketed. In effect, Southwest had first defined a special market niche

consisting of short-haul passengers and then further segmented those short-haul passengers by need into time-sensitive business travelers and dollar-sensitive leisure travelers. In looking for a way to fill an empty ferry flight, Southwest improper improvise oh come on you guys know i can't pronounce words improvisation had given birth to what would become one of the most widely emulated marketing innovations in airline history system-wide peak and off-peak pricing and they did this innovation again but through trial and error. Oh, this is actually hilarious. So this is a creative way to compete.

Remember Braniff? It's that pain in the ass of Southwest. They try to get Southwest to not exist at the very beginning. Then when the Supreme Court overruled them, they tried to give the injunction. Now they're being ridiculous. They're going to try to compete directly on Southwest on price. Okay. And here's the, this is, this is the funny part.

Braniff lowers their prices and they call it an introductory fair. But Braniff had been flying for 40 years. They were not introducing themselves to the market. They were just trying to bleed out Southwest. So Southwest is going to say, you know, we could lower our prices for you, but we have a better idea. We think that you think we think you're actually up for. So Southwest would not only match Braniff's fare, it would also offer every passenger choice. So they really don't want, they can't, if so basically the price goes down from $13, right? So the, their standard ticket is 26 bucks. Braniff's chart cut it in half says you can fly with us for $13. So Southwest is

like, listen, we're going to match this, but they came up with an idea. Why, like, why, how could you convince the customer not to take the lower fare and this is how they do it travelers could choose the 13 dollar fare or buy a regular 26 ticket and receive a complimentary bottle uh bottle of liquor so it's a scotch whiskey or vodka they could choose from business Business, and again, they know, we just went over it, they know who their customers are, right? Business travelers loved it. They could charge the $26 fare to their expense account

and go home with a free bottle of liquor. It is said that for a two-month period, Southwest Airlines was the largest liquor distributor in the state of texas brandon uh so this tactic didn't work out for brandiff what is the end result brand if terminated it's dallas to to hobby to houston hobby airport service in december 1975 so it's I love that idea. Okay, so this is a really important, I think, question for all entrepreneurs to ask themselves. Whatever you're doing, whatever you're working on, what is your fundamental reason for being?

Why do you exist? Are you just out there copying other people's businesses? In that case, you don't really have a fundamental reason for being in business in business or do you have an opinion do you have a point of view and i think most people when they because you think about your business all the time like you have a point of view lead with that point of view because other people are going to that message is going to resonate with other people so it says no carrier knows its niche as well as southwest it says most companies fail in their growth because they don't have a vision they don't know where to go when you have a vision It says, Southwest exercises the discipline not to stray from its strategy. It does not, for example, buy jumbo jets.

We're going to get into that really smart reason on how they simplify things. Very Steve Jobsian of them. It does not, for example, buy jumbo jets, fly international routes, or go head to head with major carriers. While other carriers have been lured by the temptation to step outside their niche, Southwest Airlines has maintained the discipline to stay focused on its fundamental reason for being. I cannot emphasize that enough. I think that's super important. All right. It doesn't even matter what I think. I mean, Herb Keller is telling you. This guy built a giant profitable airline. Listen to him. Okay. Now, this is what I love too because to me,

this is like common sense, right? You should focus on profits over market share. I didn't know that there's companies out there that optimize for market share at the detriment to profits. Nick, I would assume

you're increasing market share because you want to increase profits. Herb is telling us, no, no, no, that's not the case. You don't understand the airline industry. And he's going to educate us on this to profits. In serving its specific market niche, Southwest Airlines is obsessed with keeping costs low to maximize profitability instead of being concerned with increasing market share. Keller believes that confusing the cartoon concepts has derailed many firms. This is a direct quote from him. Market share has nothing to do with profitability. Market share says we just want to be big. We don't care if we make money doing it.

That's what's misled much of the airline industry. So he's drawing on the, again, he studied the history of the industries. And he's like, that's what misled much of the airline industry. In order to get an additional 5% of the market, some companies increase their costs by 25%. That's really incongruous if profitability is your purpose. Southwest is successful because it is willing to forego revenue-generating opportunities in markets that would disproportionately increase its costs. That's so important. Let me read it again. Southwest is successful because it's willing to forego revenue-generating opportunities in markets that would disproportionately increase its costs.

Herb is telling us, in my industry, there's people that will go after 5% more, which is just a revenue generating opportunity, but it's increasing their cost by 25%. Don't do that. Okay, so now we're skipping ahead in the book. And this is what I was talking about. It's like you have to know what you're competing with, not who, what. And this is an idea directly from Herb Keller. When Braniff's coach price between Dallas and San Antonio was $62 and Southwest fare was a mere $15, one of Southwest shareholders approached Keller and asked, don't you think we could raise our prices just two or three dollars? You don't understand, said Keller. We're not competing with other airlines we're competing with ground transportation in many cases southwest makes it more affordable and certainly more

convenient to fly than to drive there's just something uh after reading this book and then obviously hearing him speak something um, I was actually thinking recently. There's a lot of things I admire about all these different founders that I've read books on and done podcasts about. And yet because I'm totally immersed right now in thinking of Steve Jobs, I just don't know if I – the one thing – if I only had to pick one thing that I admire about Steve Jobs, it's just he has like a clarity of thinking that I don't know if I've noticed in anyone else. And that doesn't mean that there wasn't people that really sought after being – like making their simplicity like a fundamental cornerstone of their business. They don't have good ideas, of course. He's just thought clearly. That's the only way i could put it herb thinks very clearly he doesn't like he just it's it's like he's thinking for himself he's just analyzing the situation he doesn't care what other people like the um the opinions that other people

have have come up with he just says hey, hey, I'm going to look at this and I'm going to analyze this from first principles, even though he never uses that term, and I'm just going to trust in my own logic and brain. And there's a lot of people like, oh, yeah, you know what? They're charging $62. We'll charge $18. He's like, no, I'm not competing with them. I'm not letting them distract me.

I know my competition. My competition is if the price is too high, then they'll just drive. That's just really, really smart. And I guess let me tie that back to why I brought up Steve Jobs in that. One is because this note that I'm going to read to you says don't diversify slash Steve Jobs.

It's because I also read this book, re-read this book. It's the second time I've read it. It's called Insanely Great. And it's like how Apple builds products. It's the second of the two books on Apple I've read in book, reread this book. It's the second time I've read it. It's called Insanely Great, and it's like how Apple builds products. It's the second of the two books on Apple I've read in the last two weeks. And there's a story in that book, which I absolutely love, where they're making this software product, and somebody working at Apple wants to make two versions,

and then they bring a demo to Steve Jobs, and they're showing them the two different versions of packaging. And in 15 seconds, he's like, one. And I'm like, what? We make one product. That's it. There is no diversification. Make the single best product. I have to go back and look. I'm very curious what the product line for iPhone was when Steve Jobs died. Because I don't think if he was still alive, you'd have what's going on today where you have like the XR, the XS. I don't even know what the hell that they are. To me, there's been all these, and it doesn't matter, like my personal opinion doesn't matter, but I'm going to give it to you anyways. If you have all these people pining,

oh, this is what Apple needs to do and they need to make a cheaper iPhone or they need to make this iPhone. And in that book, it talks about how clear Steve Jobs' thinking was in the sense that they compared at the time, there was two separate, this is before the iPhone, by the way, there was two separate laptops. You had one for consumers, one for pro. And so you could literally go to Apple and you could choose between two options that's it and they compared dell and i think might have been sony i forgot the other company it escapes me at the moment they had like 46 different options for laptops um so i definitely think there is i believe in the paradox of choice how humans if you limit the choice like do more choices you give us the more confused we are i've talked about this before. I want a new iPhone.

I don't know what to do, like which one to get. And I'm not, I don't think I'm that dumb. And I, you know, I can use the internet. I can research it. My point is, it's like, let me get to my point. What I think Apple should do, and I wondered if they were doing this when he was still alive, is we make one iPhone. This is the best.

We are saying, I like companies that have a point of view. I don't want them to be like, oh, we're just going to give you a choice because we're going to listen to you. It's like, no, make the single best phone. I don't even want a choice on screen size. Yeah, if you want to give them choices in color or storage, that kind of makes sense to me. But this is the one phone. This is the new iPhone we have, whatever, call it the number, which I think made perfect sense. iPhone 11, you don't get to choose screen size. You can come here and buy it. We are telling you right now,

this is the best smartphone on the planet. That's the kind of point of view and perspective that I feel Steve Jobs had by reading the books. I don't know if I'm contradicting myself, if they actually had multiple versions of the iPhone when he was alive. I know obviously they do after, but I just really appreciate that. And we're also going to see Herb does the same thing and he does it as a way to control costs and to focus the company. Oh, so actually I'm going to stumble on that right now. And this is why they only fly one type of airplane. Southwest uses only one type of aircraft, the Boeing 737 flying one type of aircraft has a strong impact on the bottom line. First of all, training requirements are simplified.

Pilots, flight attendants, mechanics and provisioners concentrate their time and energy on knowing the 737 inside and out. Thus, all Southwest pilots are qualified to fly. All flight attendants are qualified to serve in. All maintenance people are qualified to work on. And all provisioning crews are qualified to stock every plane in their fleet. And they compare and contrast this in this great book called Blue Ocean Strategy I read a few years ago, where I didn't know that you could fly. There's flight attendants that only can work on a 737, but they might work for a company that has 767s or 747s or different kinds of aircrafts. I don't know the actual number, which is just silly to me. It's something about human nature that wants to induce unnecessary complexity, even though we all crave simplicity.

I think that's important to keep in our minds somewhere. Just reduce, reduce just reduce reduce reduce reduce This makes it easy for southwest to substitute aircraft reschedule flight crews or transfer mechanics Quickly and efficiently with only one type of aircraft the company can reduce its parts inventory and simplify this record keeping Which also results in savings? I.e makes it easier for them to make a profit Sticking with the 737 also helps the company negotiate better deals with acquiring new planes. Look at all the benefits.

And, like, why would you get away from this? Again, really clear, straightforward, not genius-level thinking. You just have to have the discipline to do it. And I think this is another example of the clear thinking of Herb. The next page is Keep It Simple. This is interesting. Like I said, this book is very old, 25 years old. So this is before, we're going to talk about in the 1980s,

how plane tickets used to be. It says, until 1989, Southwest issued cash register receipts as tickets. That's another great idea. You obviously can't do that today, but it says customers unfamiliar with Southwest operations started complaining because they lost their tickets among other receipts. They ran them through the washing machine or inadvertently threw them away. In the meeting where executives were debating this issue, an obvious alternative to going to a multi-million dollar system that produced a traditional multi-layered airline

ticket was proposed. So they're saying, oh crap crap we're getting a lot of complaints maybe we need to spend a couple million dollars and be like all the other airlines are but this guy named gary speaks up he says why don't we just print this is a ticket in capital big bold red letters on the receipt instead of spending two million dollars to follow the rest of the industry southwest modified its ticket stock with the caption and it worked i love that idea like they just saved them two million dollars just by saying hey make it very obvious this is a ticket so obviously they can't do that today but back then it worked and this is uh herb who was a wonderful communicator and if you ever i would listen to that podcast because i think it's fantastic but if not just

just search his name and you can find him uh giving talks uh but he just i love the way he communicated and this herb on knowing what you do. We must not let success breed complacency, cockiness, greediness, laziness, indifference, preoccupation with non-essentials, bureaucracy, hierarchy, quarrels, or obliviousness to threats posed by the outside world. We don't care whether we fly to Paris. We don't care whether we have a 747. What we're focused on is being profitable and job secure. If people didn't pay much attention to Southwest Airlines because it appeared to be a much smaller regional carrier, it was just immaterial to us. We set ourselves up to go into a specific niche in the airline business so he's saying that we

know what we're good at stop worrying about what everybody else is doing yeah the 747 is a brand new beautiful plane it doesn't matter um so something that he talks about in the book but i've also heard him speak about is that a lot of the decision makers by ceos and founders has to do with ego and empire building, not the actual smart. It's not actually good for their business. It's good for how they feel about themselves to make them feel like they're so special and important. Herb was the opposite of that. They talk about on the busiest flying day of the year, which I think was either the day before Thanksgiving, whatever that day was, I'm pretty sure it's the day before Thanksgiving,

Herb would show up. I forgot which airport it was. The airport closest to the headquarters southwest. And he'd do the luggage all day long. He'd help customers with the luggage. You have the CEO at this time of a hugely profitable airline and he's out there helping you with your bags.

He did not think he was better than these other people. And that's why he's like, I don't care if I don't fly internationally. I don't care if I don't have the biggest, newest technology and the biggest plane so I can talk about how great we are. I'm just focused on doing what I do best and that's serving the customer. And you know, when you verbalize, it just seems so obvious. Like, yeah, do what's best for the customer because if you do what's best for the customer, that's going to be best for the business. And yet we trip over ourselves and we induce this unnecessary complexity when it's not necessary.

And my own version of that is something I'm passionate about. It's like that's one of the reasons I don't interrupt the podcast with ads because before I had a podcast, I was a podcast fanatic. I was obsessed with them. I've learned more from podcasts second only to books, and I'm a believer in the medium. I think this is a huge technological revolution the size of the Gutenberg revolution with the printed word. And I don't think by me adding – interrupting our time together with ads just so I can make more money is better for you. And I think that – it's funny. I wasn't planning on talking about this, but just just spawned in my mind

At the end of 2000, you know every the end of the year just happened so then I'm reading all these articles about the podcast industry and I'm gonna pull it up. I'm talking so I can get the quote correct And I'm just and they're like, you know, they're they're doing their perk. They're like they're What's the word? They're not I, like their, what's the word? Their, I can't pronounce the word, so I can't say it. But basically they're saying, okay, this is the state of the industry, and this is what we think is going to happen in the future,

and, like, this is what's going to be big in podcasting this year, and most of it has to do with ad tech, right? But what I found interesting was how they don't even understand the the industry that they're writing about okay i had to hit the pause button it took me a minute to find this um so like what i was just saying is um you know i think that you should focus every business and everything you do should focus on what's best for the most important person which is the person in this case the listeners in podcasting the customers in a business um the actual person that that you have to actually please because by what's doing best for that person you are default what is herb saying that you're doing what's best for the actual business and there's it's really interesting how people kind of flip that over.

So I'm reading all these posts, and my stated opinion here is rather clear. Listen, I don't care if podcasts are going to do ads. I'm not going to do that. I'm against that. Specifically what I'm against is mid-roll ads, how advertisers are paying more money to interrupt what you're listening to, which I find unconscionable. And, you know, some people do it at the very beginning, like Joe Rogan does. Some people do it at the very end, like 99% invisible.

Whatever you're going to do, I mean, that's fine if that's the route you're going to go. I personally would love to see the destruction of the entire podcast ad industry, but I know that's completely unrealistic. Well, maybe it's not even unrealistic, maybe unless you show other people a better way, a path forward. Eventually that could one day be like the default as opposed to what it is in the US industry now. But anyways, I'm reading. So I keep a close eye on what these podcast networks do, the ad networks, because I want to study my enemy, right? And I'm reading this report and I'm like, this is, my enemy is stupid. My enemy is a moron because I'm reading this and they start off, they're like, there are two important players in the podcast industry, advertisers and publishers, meaning advertisers and people that make podcasts. No, no dummy. There is one

important player in the industry, and that is the listener. Because as the listener goes away, you don't have a podcast. You're sitting there talking to nobody. This is my problem, why I think you should have like a, not an enemy, but like a target or like a point of view. And this is my point of view with podcasting. It's like, they don't even understand that. They literally think the two most important players in the industry are advertisers and publishers. If you're going to make a statement that there's two important players in the industry, then at least one of them has got to be listeners. It sure as hell is not advertisers. You could say listeners and podcasters or listeners and publishers,

but you can't start off with advertisers and publishers. And that's all you need to know about these people. They don't care about the end result of what they're making because they don't even, just like what the example Herb gave us, where you have this airport that no one's even paying attention to and it's a gold mine why is it a gold mine because it's closer to downtown where my business travelers are going and nobody's using it these people don't even understand anything other than the tons of money that the advertisers are giving them to to make a worse listening experience okay so i'm going to hop off my soapbox because that's not what you're here for but when i'm as i'm going through these books

and reading these things, these random thoughts pop into my mind and I just have to be, I try to be authentic as possible and tell you what's going on or at least my opinion on it. Okay. Random quote, which I love about Herb Keller is he just made work, you know, he had a good time. You could tell that from his drinking whiskey every day, which obviously don't advocate. Life is too short and too hard and too serious not to be humorous about it. That's a great quote for him. Okay, so skipping ahead a couple more ideas here for you guys. Oh, that one I already read.

Oh, this is fascinating. This Bill Gates quote is in the middle of the book, which I just want to um they talk about like they're talking about the culture the significance of uh adaptability in the culture of southwest and they're using a bill gates quote to illustrate that so it says when we look back at the last 20 years it is obvious that a number of large companies were so set in their ways that they did not adapt properly and lost out as a result. 20 years from now, we'll look back and see the same pattern, Bill Gates says. So what is he saying there? History doesn't repeat.

Human nature does. He actually got caught up in this where they were a little late to the internet, a little late to the – I know they're making a lot of profits from their legacy businesses, but a little late to mobile computing as well, which is inevitable. It's going to happen to all of us. Okay. Oh, so I like this. If you're going to be small, you have to be fast. Another great idea from Herb. And he says, Keller illustrates the speed with which Southwest moves by telling a story about Don Valentine, former vice president of marketing. Valentine had just joined Southwest from Dr. Pepper when the marketing group met in

January to discuss a new television campaign. So remember, we always talk about how large companies do really, really silly things. And the longer you work at a large company, the less you're going to actually notice this. So this guy's coming from Dr. Pepper. He's going to Southwest, which has more of a startup mentality or a small company mentality, rather. Valentine was ready with his timeline for producing these ad spots. The commercial could be scripted by March. Script approval could be completed in April. Casting could happen in June.

And the company could start shooting in September. When Valentine finished out, his schedule, Keller said, Don, I hate to tell you, but we're talking about next Wednesday. The new vice president quickly became accustomed to the speed with which Southwest operates. So I've talked about it on the podcast a few times, the, the, this idea, the, one of the people I've learned most about just good, fundamentally good ideas for apply to your businesses is Jeff Bezos. And then if you read the book, The Everything Store, which I did a podcast on,

he repeats this stuff over and over again, which is really important because if they're important, you have to be willing to repeat yourself for 10, 20, 30 years. So it really seeks in. Your ideas really start to take root and sink into the minds of other people. And so these ideas that Jeff repeats all the time, they call Jeff-isms. So this is a herb-ism. And he says this over and over again, and I think it's good for all of us. He says, success is never final. Indeed,

success must be earned over and over and over again or it disappears. And this is something that I'm an advocate for in my own life and the note I left myself is the benefits of curiosity are unpredictable. And I'll close on this. Keller is a student of life and a voracious reader who digs deeply into issues to understand them thoroughly. It is not unlike him to go on a book buying binge and spend $400 or $500 at his favorite bookstore. When his son David was studying physics in college, Keller started reading up on the subject so the two of them could converse.

Keller once bought a 300-page history of Richmond, Virginia, and read it before speaking there at a symposium for CEOs. He ends up having a dinner at some old-time Virginians' home, talking about the history of Richmond. They're going around the city, and Herb is pointing out where battleworks were set up and other places of historical importance. I don't know where he finds the time. He didn't do it to show off. He did it because he was going to a new place, and he loves history. So that's the benefits of curiosity and how they are unpredictable. There's something that I read on Twitter the other day that I've been really trying to think about in general. And it's a double entendre.

And it's just a good mantra for your life. And it's three words. Avoid boring people. Meaning avoid people that bore you and avoid boring other people. And one way to avoid boring other people is to learn a lot, to read books, to listen to podcasts, to watch different lectures, to get into whatever it is that you're into. That way when you're having conversations, you can actually bring up something that's just not the common stuff that people just repeat over and over again, not just stuff that you find in popular culture. The people that were at dinner with Herb, what's going to happen from him reading that book?

Well, first of all, he read it because he's intellectually curious, so you have to start there. You either are intellectually curious or you're not. I think personally everybody is. It's just beaten out of them from when they're children. They just have to apply it. They have to find what they're curious about and go deep into that but his benefit is the people that may not have known who her was before like oh this guy's really interesting he can carry on a conversation he knows things uh what is what's a human response to that it's like oh shut up about your no one's

going to respond that way i'm like oh this is a guy i want to know more about And those benefits to all of us is, you know, they're, they're unpredictable, but they're legion. So, um, okay. So that's where we are going to leave this, uh, this, um, podcast today. Um, so one thing that I would just want to bring up to that book I was reading at the beginning, the creative selection book, um, I'm actually doing a podcast on that and it's going to go on the reviewer only feed. So this is at the beginning of the podcast to ask for your direct financial support. So that only applies to people that can afford, let's say on a monthly basis, you can afford to spend one or two, go to buy coffee once or twice. if you're in a situation and i've received emails like this some people are students some people are in a bad situation i don't want you to support

financially you can do uh things you can do it in other ways you can leave you can tell friends about it you can share it on social media you can do all kinds of stuff but if you are in the position where you know it's not going to break you if you buy one or two coffees a month, please tap the link that's in the description and sign up to support this on either monthly or annual basis. You're going to get, you know, at this point, if you take all the notes that I've done so far, and again, they're tweet size, I break them into like tweet size bullet points. If you add up the words, it's already, I've already written over a book and it's like 60 or 70,000 words, something like that. I forgot the exact number, but it's massive.

And it's just ideas from entrepreneurs about building companies and their best ideas that they have. So please support doing that. Now, however, if you're in the other boat and you can't afford to at the moment, that's fine. There's another way you can do it by leaving a review. If you leave a review or a rating, take a screenshot of that and email it to me at foundersreviews at gmail.com. I'll reply back personally with my private podcast feed. I've already done two podcasts. I've done one on Steve Jobs based on Ed Catmull, the founder of Pixar, working with him for 26 years.

Another one I did on one of the co-founders of PayPal. And then I'm recording this week a third one, which is going to be that creative selection book, which I read from at the beginning of the podcast. So it's very easy to do that. Take a screenshot. If you're on a podcast, like a lot of people listen to me on Overcast. Overcast has this great feature, which a lot of you guys have been doing, where you can pick an episode. Maybe it's this episode or another episode which you really liked. Recommend it by pressing the little star. Once you press that star button in Overcast, it turns gold. Take a screenshot of the star turning gold and email it to me at

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Recently, I've had some people DM me on Twitter their review. If that's more convenient for you, that's cool with me. You can DM me. My Twitter is davidcenter1, the number one. It's also on every single, the bottom of every page on the FoundersPodcast.com website. So I think I've talked enough. My voice is already starting to lose it again. So I just want to thank you again for your support. Thank you for listening.

Thank you for telling your friends. And I'll be back very soon with another podcast about another founder.