Invest Like the Best with Patrick O'Shaughnessy - Wolfgang Hammer - The Power of Story - [Invest Like the Best, EP.447]

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Starting point is 00:00:30 Hello and welcome everyone. I'm Patrick O'Shaughnessy and this is Invest Like the Best. This show is an open-ended exploration of markets, ideas, stories, and strategies that will help you better invest both your time and your money. If you enjoy these conversations and want to go deeper, check out Colossus Review, our quarterly publication with in-depth profiles of the people shaping business and investing. You can find Colossus Review along with all of our podcasts at join colossus.com. Patrick O'Shaughnessy is the CEO of Positive Sum. All opinions, expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of positive sum. This podcast is for informational purposes only and should not be relied

Starting point is 00:01:12 upon as a basis for investment decisions. Clients of positive sum may maintain positions in the securities discussed in this podcast. To learn more, visit psum.vc. My guest today is my friend Wolfgang Hammer. Wolfgang is a successful film producer and executive who helped create House of Cards, and ran several major studios, including Lionsgate, CBS Films, and Miramax. He's now building a new kind of film studio with support for Mitch Lasky and Mark Andresen. Wolfgang also helps founders and CEOs use storytelling to better understand what they do and why it matters. In many ways, this conversation is a manual for how to find that story and communicate it in a way that resonates. Wolfgang shares the questions and tools he gives leaders to help them do the same.

Starting point is 00:01:59 Our conversation explores how stories work, what great ones have. common and why understanding your own story can be transformative. We talk about the three layers every story must have, the external, the emotional, and the philosophical, and how they apply to building companies and leading people. So many CEOs at both startups and massive Fortune 100 companies have Wolfgang to thank for changing how they think and talk about their business. And I hope this episode gives you tools to do the same. Please enjoy my conversation with a great Wolfgang Hammer. I'd love to ask a bunch of questions about work that you've done with companies and helping the founders of those companies distill down the narrative of them, their business, their product

Starting point is 00:02:43 in a way that's transformative for them. I know you've done this with startups, you've done this with massive companies we probably can't name. It's a thing you've done over and over again. Can you describe in as much detail, crazy detail as you're willing to, the method that has started to emerge from this curiosity you have about certain builders and what you do with that curiosity and how you help them? There's a thing in character development where the character at the beginning of a story will have a concept of the world that they believe is fixed and it's very often a flawed concept. This is always attributable to a lack of self-knowledge. And I think with the case of a great founder who feels that they're building something that's working and then they feel

Starting point is 00:03:26 that perhaps the way they're thinking about the context wherein this product lives is limited. With big companies, sometimes they have a product that perhaps is not as good anymore as it used to be and that the conception of the world is antiquated and they don't quite know how to pivot it and then there are all these superficial answers that come and you grab from the world,

Starting point is 00:03:44 what the answers might be that you need to structure your company around and my suggestion is always to pull that from the inside so to access it through self-knowledge. So with a founder, they're simply trying to find access to some very truth that they haven't looked for in the right way that's in there. When you talk to someone about this like self-knowledge exploration or something, is the thing after the underlying reason that they themselves may not know yet why they're doing what they're doing? Does it boil down to that? The way I think of it is story works in three layers. One, there's the external mechanics of how the character interacts in the world and you can substitute character for product.

Starting point is 00:04:24 That's a requirement. And in the case of technology, it's technical. You've got to have something that works. And then there are two more layers, which is a subjective layer of why is this series of events important to me and what does it mean to me personally? And then there is a philosophical layer. And on a philosophical level, it's probably where you try to find out,

Starting point is 00:04:47 and you have to steal man this. And it's very easy to straw man it, but you've got to steal man it. How you believe the world works today. and what people believe makes a good world. Because everyone, most of the time, believes they're doing what is the right thing. It needs to be done the way it's done for a reason. They're mostly not wrong.

Starting point is 00:05:07 So there's a sort of almost intractable philosophical beliefs of how the world works and why that's a good thing. And then you juxtapose that with your own personal philosophy of how the dominant worldview is actually wrong. And you just plant that with your own personal philosophy. And ideally, you do this, you know, it's four or five points, and you do it on a direct refutational basis. So each one, you say, everyone believes this, I believe that. When this is steel man, this is really helpful.

Starting point is 00:05:36 And then you do the same. So this is on a sort of global level about how the world, and when we talk about a world, it's probably specific to whatever it is you're building or running. And then you do that for the personal as well. So you can do it for a customer. You can do it for a person you're selling to. how do they believe things should be done? And you juxtapose that with what you think should be done.

Starting point is 00:05:58 So there are three layers, and you want to hit each one of them. I want to just like drill on these three layers of the story and try to turn it into a device that someone could like take away from this and try to apply to themselves. If I'm listening and I'm curious about, I'll just keep it grounded in business, like the story of my business at these three levels, is there a good question that I could ask, like prompt myself with

Starting point is 00:06:21 to get at the external, the emotional, and the philosophical. Can you think of a question for each? I think the external would be, what are we doing? What are we making? What are we selling? What are we buying? Whatever it may be, there's a core function of the company. The philosophical is the why. So you believe in certain ideals, a certain way.

Starting point is 00:06:38 You believe that the world should be on an abstract level. It's an abstract why. And emotional is a personal why. In the founders case, it's very often why they are doing it. So maybe to rebuild it in the other direction, The questions are something like, how should the world be in a general sense? Well, how do we believe? How do I believe the world in the good life? Yep. The second layer is, why am I doing this? What is it about my specific story that mapped back onto that?

Starting point is 00:07:05 And the third is, what are we doing about it? And if you tell the company's story in that way, what does it galvanize that makes it worth pursuing in the first place? Because it seems like the thing that I encounter over and over again is even companies making something really great don't know how to talk about themselves for whatever reason. I'm curious why you think that is, why companies struggle with that, and then why there's such a payoff to doing the work to figure it out. I think sometimes it's because doing the thing is so difficult and complex that the idea of having to frame this now on top of everything else in some sort of philosophical way is overwhelming and doesn't even seem necessary at times. Of course, it's always present and people just are not conscious of it. So in a pretty kind of understanding of

Starting point is 00:07:49 what is actually happening is made conscious, and it's communicated in a way that doesn't quite name the thing, but it was able to metaphorically describe it. It can be extremely inspiring, because it simply seems that these three elements of the external, the internal and the philosophical combined, unlock something that moves people very deeply. I was at Stanford when the turnaround for Apple in its second inning, I should not be using baseball metaphors because I have no idea what they how, but this was a man who had a philosophy, a personal wrong view, and knew exactly what he was fighting against at all times, and then acted accordingly with unbelievable discipline and courage and created something that was a work of art in many ways. He literally wanted to make

Starting point is 00:08:33 business art, and he kind of did. Every one of these instances is completely unique, obviously, but I think that is what's possible. It also makes it just more interesting in general. It's very easy to be conformist in some sense, because you know what's expected. but there's a lot left on the table too. At the same time, espousing a new narrative or finding a predicate understanding just unlocks a ton. It doesn't need to be this life-changing.

Starting point is 00:08:57 Sometimes it can be incremental and just unlock a whole new world of potential that is very easily implemented. And in many ways, stories are very good at creating symbols which represent some sort of transcendental belief that people participate in. So in the sense that everyone has an ultimate concern,

Starting point is 00:09:16 something that they're in absolute ways concerned about. We'll talk about it, but it can be many different kinds of things. It can be money. It can be a deity. It can be truth. And to be able to present an ultimate concern around a business organization that makes a product of some kind, I think, fulfills personal life picture for the people here communicating it to.

Starting point is 00:09:38 So it just feels more important. It feels truer and it feels more meaningful and worthwhile. We're going to talk a lot about applying some of these principles to the world of building companies or making things. One of the very first things I can remember you teaching me is something to the effect of everyone focuses on the new when trying to tell you about their thing, but that the right approach is maybe only 20% new and 80% familiar or something like that. Can you say more about this principle of storytelling or of delivering a message or conveying something to people that the trap we fall in of trying to just focus on the exciting new thing? The interesting thing about this whole world is that there are no rules to it. Everyone gleans and tries to come up with rules for themselves.

Starting point is 00:10:23 Sometimes that seem to work more often than they don't work, but there's no book on this. Really, Raymond Lerwe, the designer, had a similar rule around 80-20. The most tolerable element of new before it's rejected by a human mind is incomprehensible. With the idea of originality and creativity, there's a sort of tension, even of itself is a story. there's this tension, especially now, originality is highly prized, and there's sort of this belief that only the very new is truly novel. And with storytelling especially, but I even think, maybe this is confirmation bias, but I even think in business or innovation, the new is really just the obvious uncovered through systematic trial and ever over a certain period of time,

Starting point is 00:11:10 so that by striving to stay within the obvious and trying to find a variation on the obvious, I think you have a higher chance, at least in storytelling, of discovering something novel that will still feel intelligible enough to categorize in the world. Some people have an ability to see something truly new

Starting point is 00:11:27 and immediately categorize it. Those people tend to be very successful investors, for instance. But generally speaking, I think the idea of original is overrated and the great filmmakers know this. The great novelists know this, that you can begin with something very familiar and make it feel totally new incrementally. Tell me about the short film that you like so much. That's nothing more than a camera panning back and forth.

Starting point is 00:11:51 It was a project where simply there's a camera installed in the room and the camera would move back and forth across the room. And each time uncover a little bit more of the room and nothing else happens. There's no payoff to it. But the suspense of seeing a little bit more information about the room is absolutely riveting. Even just this tiny amount of new information being given creates enormous suspense because somehow we're good at anticipating. We're really always anticipating. And each new piece of information gets put into some kind of puzzle. So by the end, the suspense is unbearable.

Starting point is 00:12:24 If you think about the power of communicating by starting with the familiar and the known, how would you encourage CEOs, companies, people talk? talking about their thing, use that truth. What is the method that you've seen the best explain accepted reality before trying to explain their new thing? Is there a method that comes out of this that you think is useful to founders, especially as the group that I'm the most interested in? The reason storytelling to me is so effective is because you have a subjective point of view that an individual can relate to because it's imitating and processing the character's point of view. So it's subjective in that.

Starting point is 00:13:04 way. The subjective access to storytelling, it would be a universal truth, but that can be only access subjectively. Does that mean that in trying to reach the mind of a customer, let's say, the right thing or allocation of time for the founder is to spend most of their time understanding the story of the customer as it currently exists versus how it should be and then build off of that? I think that's exactly right. Someone called me. I hadn't heard from them in a while and they said, we realized we've been selling to the wrong level. We have to sell to C level. We have to sell to C level. opposed to frontline manager level. And the sales pitch didn't work to the sea level. It was because they had not changed the framework, this objective personal philosophy. The sea level has a very

Starting point is 00:13:47 different worldview of what's happening in company than the line managers. And we worked on it. And it was like magic. It was like magic. All of a sudden, closing huge national deals with huge companies because they understood the psychology of the sea level managers. I think it's easy to forget that you're dealing with human beings, you know, have a human experience at the same time as having a professional experience. And story is really good at seeing these two layers at the same time. There's a subjective experience that a human being has, and then there's the professional experience on top of it. And I think you want to combine these two and understand you're dealing with human beings first and foremost. And I think the greatest founders and the greatest builders

Starting point is 00:14:27 understand this instinctively. What did you learn running studios? You've made or been a part of making so many things, so many movies. Yeah, I always ran these sort of mid-sized places. I never ran at Wonder Brothers type places, simply because they don't make the kinds of movies I'm particularly good at or interesting, interested in. At the same time, it's a very specific skill set

Starting point is 00:14:46 to run the big ones. So I ran the mid-sized ones. I think it has to do with being able to communicate in different worlds, which is actually quite difficult because you have to speak the language of filmmakers who live in their own wild, and then you have to speak the language of corporate

Starting point is 00:14:58 because they're reporting requirements, business requirements. you have to speak the language of marketing and sales. You're in these different worlds. And your job is to understand the language of filmmaking and the language of business and the language of marketing. They run interference so the thing can happen. What could CEOs learn from filmmakers to groups that like lead a group of people

Starting point is 00:15:21 to make a thing? I've always had this weird obsession with filmmakers. I don't know why. Maybe it's the fact that the thing they make, it ends. The project ends. And then it's on the next. It's not just this like continuous thing that you have to. constantly build, and that's appealing to me in some way, you've worked with some of the amazing

Starting point is 00:15:36 filmmakers and appreciated their art. What could one learn from the other? I come back to this ability and willingness to take ultimate responsibility, which is really not what most people want to do at all. And for some reason, especially filmmakers, I have a true vision of what it is that want to be doing, which means they're birthing this project, and they take ultimate responsibility from beginning to end, and then do it again, and then do it again. each time risking total failure, staking their entire being on this one next thing. They're running these pretty big temporary startups that get funding from the outside well.

Starting point is 00:16:14 It's like they get distribution from someone else, not themselves. So I think it's courage. And it's also encouraged to espouse their particular worldview and all the great filmmakers have a very particular worldview. I think it's extraordinary. It exists at all in the world. Someone like that exists. who will do that even if it fails.

Starting point is 00:16:35 And then is willing to do it again. And some of the CEOs I've gotten to know artists in some ways. This is difficult stuff, especially when you have 100,000 employees. I mean, and you're owning it too. But to answer the question more precisely, I think it's the willingness and the courage to espouse a specific kind of worldview that perhaps is a little bit counter, but sends in some tension to the dominant worldview and own that anyways.

Starting point is 00:16:58 Having been and worked with lots of CEOs, that have chosen this ultimate responsibility, how would you articulate the job of a CEO? In your experience, when you've seen people do that job well or do it poorly, what are the good ones in some basic sense doing really well? All society is communication. And that because of its complexity, communication breaks down into buckets of specialty.

Starting point is 00:17:20 But it's, in essence, being a master communicator of an almost infinite amount of buckets. And knowing to context switch between them and understanding the language games at each one of these buckets plays, but never forgetting the core principles underneath all this, some of it is unspoken. So I think the people I've observed,

Starting point is 00:17:37 especially as one person that I admire enormously, is doing a massive turnaround. And he has been communicating the same marching orders for two years to this huge company. Everyone around him was in doubt, and the results are finally coming in, and he's right. So in post, he was a whirl against all these obstacles,

Starting point is 00:17:54 but he was able to do it because he could communicate exactly what he was doing, almost in these three layers to anyone, but always adjusting, never the philosophy, but always sort of adjusting the emotional component to whomever he was speaking to. So that each person could hear, the point needed to be conveyed so they could be at peace knowing that they're done their bit for this thing to work out. And to be able to communicate that in such a way that the people you're speaking to can hear it because you're adjusting this emotional, subjective emotional component to them. I think that to me is the secret of great communication. What is an iconic character to you? And I ask that because I feel like most people maybe selfishly want themselves to be like an iconic character in their own story, their company to be an iconic thing in the world that it operates.

Starting point is 00:18:40 You see what iconic characters, what things come to mind? My view today and my change, but it has probably to do with an ability to be a Greek hero, which means to live and espouse a worldview that is universally disliked. That's iconic. I'm really interested in this pure narrative level in my world. what Elon Musk is doing because it's so unconcerned with the traditional hero trajectory is almost Greek and this idea of breaking societal rules, if you will, that you get to some platonic ideal that is worth more than acceptance. And I think all stories have in common the idea of resilience that the character will overcome these obstacles and things are not working. And there's enough

Starting point is 00:19:22 knowledge and enough power to go where one must go or one has impelled or has been impelled to go and keep going anyways. So this idea of resilience and to keep going anyways, even though the obstacles are getting enormous, I think inspires that begrudging admiration. None of this is a moral evaluation. No one cares what I think was good or bad on a personal moral level, but on a narrative level, I think it's absolutely fascinating that you have someone willing to step out on such limbs all the time. Is that just fighting death? And yes, everything is in some ways a death project. Absolutely.

Starting point is 00:19:56 Who feels that creativity, the art of creating negates death and therefore is the purest expression of a battle against the inevitable. And Tolkien has this famous clip on YouTube. All stories are about death. And I think he's absolutely right, because it's the ultimate stakes. And it's the stakes everyone lives with every day

Starting point is 00:20:12 and we get up and do things anyways. To go deeper on that, so we all have to die and therefore a certain kind of story is appealing? I think it has to do with a perceived power differential. then we're completely powerless in the face of death, at least for now, and that is a fantasy to acquire more power. And then because we have this capacity to imagine the future, and we can imagine really much anything,

Starting point is 00:20:35 we have an ability to create our own cherished outcome. They're overcoming this weakness with the power fantasy. Robert Town, who was a great screenwriter, and wrote Chinatown, and he recently died, wonderful life and a wonderful career. He said this to me at lunch years ago when I was a young executive. he said, stories are either desires fulfilled or anxiety is purged. And I think he's right.

Starting point is 00:20:57 These are great minds who've made great films. And it's never left me. I think it has to do with overcoming basic human condition. I want you to expand on each of those two, anxiety purged or fantasy fulfilled, that these are the two fundamental kinds of stories. Is it important that people know which one they're in? I think you do have to know which part of it you're in. We experience both desire and fear.

Starting point is 00:21:19 It's not just one or the other. The hero's journey is very often a desire to rise in the world. That's a desire to fulfill one's potential in the world. And anxiety or fear purged is an idea of an inherent fear of something that might happen to you that you really don't wish to happen. And it feels good to see a version of the world play out that which you're afraid of actually doesn't happen because you have had agency in defeating it.

Starting point is 00:21:46 And this is always really important. So story is character and action. things don't happen to you, you act against obstacles. And as you do, require knowledge, with knowledge comes power, to then affect the outcome. It's also interesting to see that this is never done alone. They're always surrogates. People who give you knowledge and people who aid you in the quest, whatever the quest may be. As you begin to process for what makes a great story, making them enjoying them, what elements started to fall out?

Starting point is 00:22:16 I have an unusual maybe view of this because I don't know we think it needs to be enjoyable. I think that's a recent meaning in the last 30, 40 years, phenomenon where storytelling became entertainment almost exclusively. I don't think that's the early genealogy of that space at all. But I also think story has a religious aspect, not in the organized way necessarily, but perhaps in a way of ultimate concern. Stories are very good vehicles for delivering experience of ultimate concern. Maybe the most common ultimate concern, probably by revealed preference in the U.S. in the group of people listening to this is money. Yeah. What do you think about that? It's an unbelievably powerful symbol because it stores potentiality. So the mind can imagine anything.

Starting point is 00:23:01 So it's the ultimate story in some sense where both all your desires and fantasies can be fulfilled and all your anxieties can be perched to such a degree maybe that the money project is a denial of death project. The more you accrue of that, it allows itself to, to, be imprinted with any vision that you want. The more you're a crew of it, the more it gives the illusion that you're not going to have to leave your consciousness. What is a great story to you? What does that mean? I think it's a character starting at an extreme point, going to an extreme point that they cannot imagine at the beginning, but consciously imagined at the beginning, but somehow deep down know that this is where they need to go. And then situations

Starting point is 00:23:38 arranged in such a way that the original intent faces bigger and bigger versions of a barrier, that is then resolved at the very end to some degree. Most characters that you meet are either underdogs trying to rise or kings are falling or queens are falling. The biggest people in the world believe they're the underdog because we are, again, locked into this subjective experience of the world and we are wanting being. Why is that such an appealing story?

Starting point is 00:24:07 Why is the underdog that succeeds so universally enjoyable? but because everyone views themselves as one. You get access to people when they recognize themselves in what it is you're saying. It's the human desire to overcome our wretched state, which is this kicker-gat phrase I always love,

Starting point is 00:24:29 and it's humans are gods who shit. And I think it has to do with this capable being on this planet that has to die. And that sends all these things are quite, questions of death. I'd love you to evaluate my distillation of great story, ask you what's missing in the elements that, as I thought, I know you were coming to see me. So I was thinking about this a lot, and I was trying to give myself only three common traits or something just to keep it simple. And the things I came up with were originality, which we talked a little bit about in terms

Starting point is 00:25:03 of dominant worldview versus how you think the world should be hardship and ultimately transformation. As I think about my favorite stories, or if I think about the own best versions of my story that I've lived, because I know it intimately, those three elements have been present and or dominant in what I view as great stories. Where do you agree and disagree with those elements? I'm curious. I think Hotship as the barrier to be overcome is the foundational element of any narrative. I find it very interesting in general that when you look at the history of storytelling, how the archetype, if you will, the, paradigm of what a story is, is someone actively overcoming obstacles to achieve something.

Starting point is 00:25:48 I guess somehow this must correspond to how collectively, you see this in Chinese mythology, you see it in Indian mythology, you overcome through activity, through intentional action. Big or small, it doesn't mean it can just be very, very small. So I think that's probably as a foundational piece, the overcoming of obstacles, which then becomes in and of itself the reason for doing it. There is no journey. need to go on without an obstacle. So in that sense, I think it's essential. Originality, I have this specific view. I think very often successful people, I just heard an interview with a brilliant designer, and he talked about originality and how it's so important.

Starting point is 00:26:27 And it felt like a status game that people play, that when they do something great, that somehow it was entirely original. So as to aggrandize their achievement. And it's entirely possible that they felt that this was the case. I think very often it's much more derivative, and I think we should be much kinder to the notion of derivative, and I think we should understand perhaps that originality is just another form of derivation, except it's one that perhaps hasn't been done quite in this way before. Everything's been said, right?

Starting point is 00:26:56 Everything we've just said on this conversation, and this conversation has been said before in some way by someone at some point. It just wasn't maybe heard, or it wasn't said in the right way that one specific person could hear it. I think originality is in the same way. Maybe to redefine originality then, Maybe originality is the wrong word, and instead it's like a novel revelation of some constant truth or something like that, like a new way to show people an old thing. And so what about transformation? Transformation is interesting because in the Greek poetic sense, it would be a transformation. It would be the emergence of a new insight, a new power, which then creates a new kind of version of yourself or of the hero's self. And then lately, I've also added maybe in my mind this idea of the transcendental insight as enough.

Starting point is 00:27:42 James Joyce was all about the joy in epiphany, the moment where the character accesses the universal truth, the transcendental truth about the world, just for a brief moment. And that's the end of it. So even just the recognition, oh, this is how the way things really are. Maybe that's enough to. What have you learned about status and the role that status plays in human behavior? And yeah, just more broadly, I know this is a topic that you've thought a lot about, teach us about status a bit.

Starting point is 00:28:09 I think everything is about status. Every scene is about status. Every scene is about a power differential is what we find relentlessly fascinating. Every interaction is about status. There's a sort of story about, I think it was a British actor who knew absolutely everyone in English society

Starting point is 00:28:25 and for some reason was unsuccessful at getting what they wanted. And he said, when he overplayed his status, he would be hated. When he underplayed his status, he wouldn't get what he wanted. Everyone liked him, but he wouldn't get what he wanted.

Starting point is 00:28:39 When he matched status, he would be hated. get whatever he asked for. How do you define it? What is it? It's a sense of accepted superiority vis-à-vis another, whether it's physical, societal, and moral. What about just on like the very basic level of the thing you're doing and why? I'm building a film studio from scratch. Mitch Lasker is my chairman and A16Z as my investor, including Mitch. Mitch Lasker is a former partner at benchmark and comes from the video game world and Rugg and Driesen is obviously a great lover of cinema and have seen absolutely everything. And the quest is twofold, trying to make movies

Starting point is 00:29:15 in a very traditional sense that, at least for me personally, have an aspiration towards some kind of epiphany or some kind of transcendental insight, even if it's very brief, or maybe show some kind of transformation possible around these philosophical principles. And then there are two sort of technical components to it. One being is how we make things. And again, I very much believe that the nature of artistic expression is in the human, and the human intent. But technology can help. Filmmaking is inherently a technological endeavor because you're representing the world via cameras.

Starting point is 00:29:47 You're staging events to make them look as if they were real, but they're obviously not. So in that sense, it's technologically mediated and always has been. The third endeavor is going to be around distribution, but marginally, and we're all three very interested in whether something can be done on the edges that espouses this 80-20 philosophy of, well, it's going to be very much a movie company. It is very much a movie company,

Starting point is 00:30:08 but maybe has a couple of points in the dominant worldview that it perhaps doesn't quite believe and wants to substitute something else for it. What have you learned from each of those guys, both very talented? And absolutely endless. It's an amazing thing to be able to talk to people like this. And they're very different. They're both founders. They're both amazingly successful investors that have done the whole thing.

Starting point is 00:30:31 They've done it numerous times. And they're very patient and generous, at least at this stage of the game. They both have a real understanding and passion. for the craft and artistic nature of storytelling. Courage, complete comfort with calculated failure, as in if you know what you're doing, you're trying something and you know it's a trial balloon, it's totally alright if it goes wrong,

Starting point is 00:30:52 as long as you really thought about it. And there's a calculated risk as opposed to a random, let's see what sticks, kind of risk. Really incredible ability to map out, sort of in an imaginary way, what could be, always allowing that you're not seeing something, but really mapping it out, never sort of in a sense where it's this or that,

Starting point is 00:31:10 it's always, it could be all these kinds of things. And based on past experience, this has really worked and then sort of branching off of that. Most, I think, risk tolerance. I guess maybe it's a blessing of success that you just increasingly become tolerant, like I said, of calculated risk, which in the creative endeavor is a requirement

Starting point is 00:31:26 because you're going to fail. Do you think we take enough risk in general as people? No, no, not in the personal, emotional level, not on a professional level, even just being around people who have a more benevolent attitude towards failure can be extremely helpful because one's own worth is not caught up in whether something works or not. This is also a huge advantage that the Americans have, however, the Europeans. Failure in Europe is so shameful.

Starting point is 00:31:53 And then America is more forgiving. Obviously, on the margins, then sometimes you think, oh, wow, this is a level of heatlessness that perhaps is a little irresponsible. But yeah, I think risk is inherent sort of the end stage of this kind of. transformation that you talk about. When you have figured out your ultimate concern, you've figured out that they're going to be barriers, you can kind of name the barriers even.

Starting point is 00:32:14 You gain self-knowledge. You realize that through action, there's power, even just in the action itself, even though it doesn't actually yield anything immediately. And then action begins action, which begs courage. I'd love to sort of redo an exercise that you've done on me before because I think it's translatable for everyone listening.

Starting point is 00:32:31 You asked me some question, which was something that rhymed with, what is the version of your story that is so big that it terrifies you? Can you unpack that very powerful question? The mind obviously is very good at projecting into the future and can imagine really anything. And in many ways, what is possible, even emanating from our own subconscious, is so much bigger than what the left hemisphere brain, the rational analytical brain can handle. So I think there is a fear of the bigness of the world.

Starting point is 00:33:04 that fear of the bigness of the world is also reflected in the inner world. So much of story is actually an inner transformation. When you have infinite potential in the outer world, this potential is probably also inside of you. And it's overwhelming. So fear is present, but it's a fear of potential of all that could be.

Starting point is 00:33:24 So you think fearing greatness is like the ultimate fear? I think fear in greatness, as long as we define greatness as a manifold of flourishing of life. so in all its forms, not just a great engineer or a great company builder. If we believe, as I do, that storytelling, especially for the course of, you know, from Gilgamesh all the way to now, is thousands of years of storytelling and myth-making, that we have thoroughly enjoyed people realizing potential in the world

Starting point is 00:33:53 that there is an inner drive to reach one's potential. I do think there's probably a fear of reaching one's own potential because it might be too big. What about inner conflict, like a character who wants two opposing things? That's the definition of story. This is a Faulkner quote, but great conflict is the heart and conflict with itself. That's a great story. So you want two conflicting things at the same time. You're very invested in your fear.

Starting point is 00:34:19 You create situations in the original state where this investment in your fear pays off. And at the same time, there's a part of you's mostly subconscious, can be conscious. That has a dream of greatness. And those are absolutely in conflict because the fear wants to talk. and the greatness wants to come out and do its thing. And it's through the story itself that this gets worked out. And I always think that when someone takes on the position of the leader and how relieved everyone else is not to have to do that,

Starting point is 00:34:47 people love to just disappear and amass and be relieved of the burden of individuality. But this is possible because someone has a will to power and steps up and says, I will do it. Why do you think that is? Should we all be leaders in some way? in some way. I think emphasis is in some way. I think we have a very narrow definition of leaders, business or political leader, and that's sort of the end of it. I think actually if you invert that and you just simply say, you have a predicate understanding of yourself at that point in time based on reflection and you act according to this predicate understanding as best as you can at that point in

Starting point is 00:35:22 time, you're already a leader simply because you're guided by a philosophical worldview that feels absolutely true to you at that moment. Back to this exercise of a version of a story that's so big it terrifies you. Sounds like the model is raw potential is so big, but the mind can't figure it out. And so the process is figuring out how to get something that's like subconscious out, like let it free. How does one do that? Character and action through action.

Starting point is 00:35:53 This is the great discovery of the pragmatists, which I think is a huge reason for why the American experiment has been so successful. is that people do a lot of doing happening. You cannot have a good narrative without an active character. There's no one that sits around and thinks their way through problems. I think it's a combination of having a dominant worldview to fight against, of having a personal worldview to a spouse, and a willingness to, through action, and I think also through quiet reflection, that those voices that perhaps are in the subconscious safely come to the surface and see you. where it goes without having a specific outcome in mind. Over time, narrative is fear made conscious

Starting point is 00:36:36 and conquer through action. If I go back to the beginning and take everything we've talked about and ask you to give a sort of grand unified theory of everything that you've been searching for, what's your best attempt at that? I think it's a technology that is able to, through conciliance, through pulling from all strands of knowledge to communicate an ultimate concern. So an absolute truth in the story universe. It is such a way that the individual can understand it on an emotional personal level,

Starting point is 00:37:07 which is kind of also what philosophy has been trying to do, and it's also what religion has been trying to do. So in that sense, it's a technology layer of arranging situations and character in such a way that enables this transmission. So in that sense, storytelling is so teleological and has, as it's concerned, a form of salvation, not the form of salvation, a form of salvation, maybe the answer to the question, am I worthy of love? The answer is yes. Very often comes back to that on the

Starting point is 00:37:34 emotional love. And then very often is it safe to die. And the answer is in most cases, yes. Why is the answer both? Yes. Because it's better than the alternative. You mentioned a guy named Don Rosenthal to me one time. Yes. What did he teach you and how did he teach it to? that it's safe to die and that you're worthy of love. How did he teach you to you? By saying that in the end, every story is a metaphor. So you want to couch all these absolute truths revealed in a subjective way

Starting point is 00:38:04 in metaphors that don't spell it out directly, but convey their meaning through something that's close but not the thing itself. He had this wonderful way of repeating back to you the absurdity of your beliefs and laughing at them. So you would be laughing at these absurd constructs that these stories that you've come up with and believe to be fundamentally true, mainly because you hadn't done the work of just saying, well, what do you really believe? Once you do that, it's your ultimate concern and it's your bedrock.

Starting point is 00:38:35 And you can refer back to that at any given time, usually every five minutes, when you have to communicate you to make a decision of some kind. And it gives you confidence. And there is a guy that I really like this guy, John O'Donoghue, talks a lot about Master Eckhart, who had this concept of Gillesenheim, which is the letting go of all intent, simply experience the divine nature that's already in you by the pure fact that you're alive.

Starting point is 00:38:59 And once you realize that all else is enough to thought, and I think that's probably what Don Rosenthal communicated to me in a visceral way. I'm going to ask my traditional closing question. What is the kindest thing that anyone's ever done for you? I thought about this. There's so many people that are a lot too, but I know that it's my wife

Starting point is 00:39:18 who married me. I think that probably is the kind of thing. Simple as that. Wolfgang, I've counted on you for so many episodes of trying to figure things out. And you've pointed out several times today that each version of this exercise is deeply personal and you can't abstract it into some perfect formula to have everyone find their way. But I hope we've done a decent job of some breadcrumbs that people can follow in pursuit of their own most interesting version of their story.

Starting point is 00:39:48 Thank you so much for doing this with me. Thank you for your time. Thank you. If you enjoyed this episode, visit join colossus.com, where you'll find every episode of this podcast, complete with hand-edited transcripts. You can also subscribe to Colossus Review, our quarterly print, digital, and private audio publication featuring in-depth profiles of the founders, investors, and companies that we admire most. Learn more at joincolossus.com slash subscribe.

Invest Like the Best with Patrick O'Shaughnessy - Wolfgang Hammer - The Power of Story - [Invest Like the Best, EP.447]

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