This Week in Startups - Business Breakdowns: Moneyball's first-principles, paradigm shifts, and ‘burn the boats’ | E1909

Episode Date: March 5, 2024

This Week in Startups is brought to you by… Mantle. The AI-powered equity management platform designed for modern founders and operators. Get your first 12 months free at https://withmantle.com/TWIST Vanta. Compliance and security shouldn't be a deal-breaker for startups to win new business. Vanta makes it easy for companies to get a SOC 2 report fast. TWiST listeners can get $1,000 off for a limited time at http://www.vanta.com/twist MEV. Tired of the dev shop rollercoaster? Mev is your reliable technical partner, offering a well-established software development process designed to consistently deliver unparalleled value to their clients. Get $30,000 off your first three months at http://mev.com/twist! * Todays show: Lon Harris joins Jason Calacanis to discuss concepts in business, drawing parallels from Moneyball. The two dive into the significance of embracing paradigm shifts (15:38),first-principle thinking (27:16), Billy’s 'Adapt or Die' philosophy (48:54), and the turning point for the A's (1:11:20). * Timestamps: (0:00) Lon Harris joins Jason (7:35) Mantle - Get your first 12 months free at https://withmantle.com/TWIST (8:53) Moneyball cast breakdown (15:38) Paradigm shifts in Moneyball: Comparing the Oakland A's situation to startups vs. incumbents (21:19) Paradigm shifts in Moneyball: Making data-driven decisions (26:24) Vanta - Get $1000 off your SOC 2 at http://www.vanta.com/twist (27:16) The important concept of "First-Principle Thinking” (35:03) MEV - Get $30,000 off your first three months at http://mev.com/twist (36:34) Globalization's impact on startup opportunities and the importance of a unified team vision (48:54) Billy's philosophy: Adapt or Die! (59:20) The "burn the boats" moment and the importance of commitment in business (1:11:20) The turning point for the A's and their historic winning streak * Subscribe to This Week in Startups on Apple: https://rb.gy/v19fcp * Follow Lon: X: https://twitter.com/Lons * Thank you to our partners: (7:35) Mantle - Get your first 12 months free at https://withmantle.com/TWIST (26:24) Vanta - Get $1000 off your SOC 2 at http://www.vanta.com/twist (35:03) MEV - Get $30,000 off your first three months at http://mev.com/twist * Great 2023 interviews: Steve Huffman, Brian Chesky, Aaron Levie, Sophia Amoruso, Reid Hoffman, Frank Slootman, Billy McFarland * Check out Jason’s suite of newsletters: https://substack.com/@calacanis * Follow TWiST: Substack: https://twistartups.substack.com Twitter: https://twitter.com/TWiStartups YouTube: https://www.youtube.com/thisweekin Instagram: https://www.instagram.com/thisweekinstartups TikTok: https://www.tiktok.com/@thisweekinstartups * Subscribe to the Founder University Podcast: https://www.founder.university/podcast

It's not science. If it was, then anybody could do what we're doing, but they can't because they don't know what we know. They don't have our experience and they don't have our intuition. Now, there are intangibles that only baseball people understand. You're discounting what scouts have done for 150 years, even yourself? Adaptor die. Yep. It's really that simple.

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Tired of the Devshop roller coaster? Mev is your reliable technical partner offering a well-established software development process designed to consistently deliver unparalleled value to their clients. Get $30,000 off your first three months at mev.com slash twist. All right, everybody, welcome back to this week in startups. We have this new series we've been doing. It's called Business Breakdowns. What do we do on this show?

We talk about a great business story, typically one that they've made a movie about. This is our third one today. We did back in 2023 BlackBerry. That was episode 1773 of This Week in Startups. And we recently discussed 2016's The Founder about Ray Crock on episode 1872. You can find all of these business breakdowns at this week in startups.com slash BB. This Weekend Startups.com slash BB or if you type in This Weekend Startupus Business Breakdowns into Google or YouTube, you'll find it.

Today, I have my bestie Lon Harris back to talk about an incredible, incredible film. I think this is kind of like a perfect film for me, Moneyball. Welcome back to Morgan, Juan Harris. Thank you, thank you. We haven't talked about, are we only going to do movies that are based on true stories? Because there are great business movies. We talk about, you know, like Wall Street in the past. That one's not based on a true.

true story. That's just Oliver Stone made up. But, you know, it still think lessons to impart. It's just interesting. There are enough, there are enough business movies based on true stories that we could just stick to those. Or we could talk about the business lessons from Breaking Bad and the Sopranos. And that could be highly entertaining. Right. Tons. Yeah. Yeah, there's tons of business lessons in there. Starface, perfect. Never get hired you on supply. The godfather trilogy.

You need to buy whibistics. You need to buy wibisks when he throws the coffee in his face. Oh my God. Sprada's got a lot of business lessons in them. All right. Oh, yeah. You did the whole series. Thanks.

That was producer, Nick, for those of you wondering. All right, let's get started. There's so much to love about this. If you are listening to this, you are consenting to spoilers, because we're going to break down the entire film. Moneyball, which of course is based on the hit book by Michael Lewis from 2003 Moneyball, The Art of Winning an Unfair game. This film was directed by Bennett Miller.

A little known fact, I hosted a screening for Bennett Miller's first film, which was a documentary called The Cruise. When I was in New York doing my previous media company or two companies ago, the Silicon High Reporter, I used to do screening. So I did one for Bennett Miller's The Cruise. That's the one. It's about a guy who leads very unconventional quirks. Tours of New York, right?

I've seen this movie. And then I also did one for a film called Pye. But Darren Aronovsky. Darren Aronovsky. So when I was in late 90s, early 2000s, I became friends with Darren Aronovsky. He won't remember me. And Bennett Miller, who also won't remember me. But big shocker there.

And that was like a really cool independent film time period where people were making digital films. He later went on to do Capote. he did that one Fox Catcher that's really good with Steve Carell. He does, you know, he does true stories really well. And, you know, I guess now that puts it together for me. Because Philip Seymour Hoffman, of course, is in Capote. And Philip Seymour Hoffman is also in Moneyball as Art Howe.

Yeah, this was this was his follow-up. And Hoffman had gotten all that praise in Capote. So he showed back up, did another role in his next one. Also, I think Brad Pitt is Billy Bean and Joan Hill as Peter Brand, which is based on a guy named Paul to Podesta. I'm always interested in that, like why that guy's name, I guess he didn't consent to be depicted in the movie or something. So they had to change his name.

Yeah, you know, there is a whole bunch of legal issues when you're doing true stories. And I was thinking about this, like, you could do a true story without permission. Like, we could do a story if we wanted to on Steve Jobs. We could do a make our own fictional tale, or we could do our own authorized, unauthorized unauthorized. You know, there's like, people do this. They did the O.J. Simpson. There's somebody who did a series on the O.J. Simpson trial. And then they did the Monica Lewinsky trial. I forgot the name of that series. Ryan Murphy. It's the American crime story, the Ryan Murphy series, yeah. Which I both were very good, I thought. They had great actors in them. That OJ Simpson one was dynamite. I love it. But you don't

need permission, right? You can just go do those things. Right. It's, if you, I mean, it's, they're based on books, but just like, what, they didn't have to go get the permission of the public figure that the story's about, they had to get the permission of the book they were adapting. But if you don't adapt a book and you just do something based upon... I mean, you did your own independent research. Yeah. I mean, the idea would be you can't make up slanderous things about someone and present it as fact. But as long as it's clear that it's a movie and that you've made it up, then sure, you know, like Charlie Kaufman wrote

being John Malkovich before he got in touch with John Malkovich. and said, do you want to be in my movie? He just wrote it and started showing it to people. And then, lucky enough, John Malcovic agreed to be in the movie. But he wasn't breaking any laws by writing it. Actually, producer, Nick, looked this up. This is the De Podesta quote. I just could never get comfortable with the idea of somebody else portraying me to the rest of the world.

It's very unnerving. And it was something that wasn't going to go away. That was always in my mind, like any movie, to make it interesting. there has to be some conflict there in some respects. A lot of the conflict is going to revolve around my character. And that was never really the case in reality. So, yeah, you know, I just... I wonder if it was also casting Jonah Hill.

I wonder if they were like, hey, we got Timothy Chalamay to play you, whether he would have felt better of it. Exactly. Look, business leaders face a maze of tasks today. We all know that creating and managing your company's ownership shouldn't add to your stress. Well, meet Manton. This is the AI powered equity management platform for modern founders and operators. It's going to simplify your strategy and save you a ton of time.

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Okay, I just want to talk about the actors before we get into the film. Brad Pitt, Jonah Hill, Philip Seymour Hoffman. I was thinking about this and, you know, you and I are fans of films. So I just want to, before we get into the business stuff, I want to just talk about how great those three actors are. To have them as your principles is extraordinary. But then I wanted to talk about in the corpus, now, Philip Seymour Hoffman has so many amazing films.

I don't think that this one is in his top three or four, right? You wouldn't put this as better than the master. He's good, but this is not a particularly showy role. This almost feels like a favor to Bennett Miller. Like, yeah, you'll have a world-class actor in this supporting role. He's got a couple great scenes. But no, I mean, this is Phil Scher-Hoffman. So amazing in so many movies.

Yeah. I mean, the master, I think. But also a great part of, like, he had a long career as just a character actor who would show up and nail a few scenes and then disappear. Like, Twister, a lot of people forget that one of the like Randy, rowdy guys on Bill Paxton's crew and Twister is a pre-fame Philip Cibor often because he would do those are kind of the kind of roles he would take. So he was used to being kind of an ensemble player where he would show up for a few scenes. But no, I wouldn't say this is up to like. I mean, yeah, Magnolia or. Yeah, he's amazing.

Doubt, of course. Punch drunk love. Yeah, I mean, there's so many where he is. The master. All the, all the PTA moves. I think master. He's also, you know, has a small part in Almost Famous. Remember that? Sure. And Lobowski. I mean, he's so great in Big Lebowski. Yeah. I mean, what a loss. I mean. Oh, trap.

Yeah. Heartbreak. Tret. Heartbreaking. I mean, he died so young. And he was one of those guys that he would have been a long, he would have kept doing it. It would have been a long career. We would have, you know, he would have, you know, he would have aged into all these other great roles. Can you imagine him? Like what we're watching Paul Giamatti start to do, you know, like there's all kinds of different shades that you can play

as you get older and it's a shame we'll never get to see that. Brad Pitt, another good example of a guy who he's taking on different kinds of roles as he gets older. You see different sides of it. Okay, so and this is what I wanted to get into. Rest in peace, Philip, Philip Seymour Hoffman, of course.

But looking at Johnny Hill and looking at Brad Pitt, I want to start with Brad Pitt here. I was just thinking about my favorite Brad Pitt roles. Obviously, he's playing Billy Bean here. This is one of my favorite Brad Pitt's ever. Tyler Durden, okay? Sure, sure. Cliff Booth recently.

Yeah, Once Upon a Time in Hollywood. I think that might be his best performance. And Lieutenant Al Doreen. Yeah, the Tarantino team ups are great. So anyway, there's four. Where do you put, if we just take those four? You got Billy Bean in Moneyball. We're going to talk about today.

Tyler Durdon, obviously, Fight Club, Cliff Booth, Once Upon a Time in Hollywood and Lieutenant Alder Rain. Yeah, I mean, I think once, what do you? I think once upon a time in Hollywood is probably his overall best. I mean, we're leaving out, we're leaving out a lot too,

like seven, he's really good at seven. Younger, but not. Yeah, California, I remember that. Oh, and 12 monkeys. That was those first Oscar nomination. But those were like younger. I feel like he wasn't as rich of an actor. You know, I feel like his recent films

are so much better. But I don't know, where would you put this? I just named my three favorites outside of this one. I think this one is really good. It's good because it's small. It's subtle. It's little moments. It's a lot of him quietly taking in information and reacting and you're watching it all in the

eyes. He's processing it. Even in like that very memorable final scene when he's listening to his daughter on the CD. And he's, you know, as he's driving. You know, like there are lots of good sort of quiet moments, which is the real test, I think, more than the big 12 monkeys, such a big showy role. You know, everybody seems great in that kind of part when they nail it. But Cliff Booth is your favorite.

I like that. Yeah, Cliff Booth, I think because there's so much shading that character. I think people, like a lot of people come away from that movie and they think, I don't know if I like Cliff Booth. And they think that's a problem with the movie. Like, you're supposed to like him. And I'm not sure how I feel about him. But I don't think, I don't think so.

I think the whole movie is kind of about, this is a shady, there's something I don't necessarily like trust about this guy. I don't know about this guy. And I think that's an undercurrent that runs under the whole movie that, like, deep, deep down, Rick Dalton's a good, a good guy who's just kind of a narcissist and an egomaniac and got caught up in the industry or whatever. Clip boot, though, not necessarily a good person. And I think that's, and I think I really, like, Pitt really runs with that under the surface. I think it's like a barely, barely visible thing a lot of the time. And that it suddenly comes out. We're like, oh, I don't, I don't necessarily like Scott.

And he's tripping on the LSD joint he smokes and then he kills all the hippies. And he's fantasizing about beating up Bruce Lee and where he's kind of laughing as he remembers shooting his wife with a harpoon, whether it was purposeful or not. Yeah, it's dark. It's dark. And I mean, I think Tarantito, I think it's 100% on purpose. And he's playing with that. Like, there is kind of a darkness to Brad Pitt in a lot of these role.

Tyler Durdon, obviously, California, obviously. And I think he is, he's teasing that out a little bit in a nice subtle way. That's what I really like about that. Okay. So for Johnny Hill as we wrap this up in terms of performances. Well, this was also Jonah Hill. This was like one of the first times where he was like, you know, because John Hill used to be the best to me about my weiner like comedy Judd Apatow guy.

Yeah, not super bad. And this was one of the first times where people were like, oh, this guy's good. So Wolf of Wall Street, super bad and Moneyball. What do you like best there? I mean, I think this one in Wolf of Wall Street are probably. Probably probably the top, the Jota Hill top two. He's been in some clunkers lately. So you've got to go back a little bit.

He's amazing in Django, too, as a very small role. Yeah, a very small part in Django, but he's very good. That's true. Wait, I don't remember him in it. He's one of the KKK members. He's one of the KKK guys. Yeah. Oh, he, oh, I didn't remember that.

Yeah, he's like complaining about how his, like, hood doesn't fit correctly. His wife, he's like, I didn't realize you guys' wives put these together. for you. It's very funny. One other one that I should mention. I think this is the end is really underrated. That one with... Oh, this is the end is great. With Apatow and all those guys like partying as the apocalypse happens. He's really

funny in that. That's one of his funnier performances. And I also like the 21-22 Jump Street movies with him and Channing Tatum. They're a good comic duo. So lots to recommend from January. Just not recently so much. So let's get into the film here.

Why don't you set this up for us? lawn and then we'll start playing some scenes in the business lessons that we found in this. Yeah, Moneyball came at, let's see, six Academy Awards. I don't know if you wanted to mention that up front, but we'll jump you up. It was nominated for Best Picture, Best Actor Brett Pitt, supporting actor Jonah Hill, adaptive screenplay, sound mixing, film editing, it won nothing. It won nothing at all that year. But hey, six nominations, that's not bad. And it was a part of that whole award season. They were in the mix that whole time. Okay, so let's start. into it. The film opens with the 2001 American League Division series in which the Oakland A's

lose in a devastating, painful way to the New York Yankees. And what especially sticks in their craw about it is that the Yankees have so much more money to spend on players. The 2001 Yankees had a payroll of $114 million. The A's were spending just around $40 million. That means not only do the Yankees get to spend so much more get all this better talent, but they may get to cherry pick players they like from smaller market teams and just buy them out. So even if the A's do all the work to foster a guy like a player like Jason Giambi or Johnny Damon and take them from being sort of unknown underdog guys in all-stars, the Yankees can then just come and grab them or teams like the Yankees. The Red Sox are also sort of in that mix,

who have these huge war chess and can just go throw money around and buy up whoever they want. And this is where baseball is very different than, say, the NBA. NBA has got a salary cap that's very fixed, very penalizes you. That equivalent producer, Nick, doesn't exist in baseball in the same way, yeah? No, baseball is the only remaining major for U.S. sports that does not have a salary cap. Similar to the soccer leagues in Europe that don't have salary caps, which is how you see, like Ronaldo getting, you know, $100 million a year from the Saudis. I do.

Or Messi getting $70 million a year from, you know, personal. They can get away with that in part because it's such a longer season. There's so many more games. It interjects a lot more sort of like randomness and variability. So like if the Lakers were so much more dominant, there's just fewer games. They would just crush everybody the whole season. Am I, am I crazy with that, Nick? Is that part of the deal?

I actually don't think so. I think what really it is is that the MLB's player union has had like a hard, it's a hard line for them, the salary cap. where they're like, we never want this because it's BS and players should be paid what their, what their market value is. And there should never be a cap on what people can earn. And the players union won't even go when they do. Do you feel like it hurts the sport of baseball significantly that it's unfair in this way?

That's what I'm saying. I actually think every sport, I don't think salary cap should exist in any sport. I think they're stupid. And I think putting a cap on how much someone can earn is ridiculous. Like having a max salary in the NBA is insane. If someone wants to pay Janus $100 million a year, he should be able to make that. It feels un-American to me. Yeah, it's pretty communist, right?

It's pretty socialist. But I mean, they're looking out for making the game more fun. Like, the whole point of having a game is to make it competitive and fun. But if you're a small market owner, like the A's owner, right? Therein lies the problem in baseball. You see the A's owner in the beginning of the movie. He's like, listen, we're a small market team. I just don't have the budget.

Listen, if that's what your deal is, sell the team to someone who can afford it. Because you shouldn't be owning a baseball team. if you can't afford a salary that could be. That's what I think. Yeah, it's fascinating. So there's a fascinating diversion of just how these leagues have evolved. But this is the setup.

You have a certain amount of resources. Other teams have three times that amount of resources, four times the amount of resources. And so how do you do more with less? And when I see this setup, I immediately thought, uh, Lon, about startups. versus incumbents, right?

You have an incumbent like Google. They can put a thousand engineers on their AI project. They can put 10,000 engineers, you know, they can put an unlimited number of people on a project. And then you have some startup, chat GPT from OpenAI or whatever, and the startup somehow figures a way to do more with less and beat them.

And sometimes having a limited budget makes you look for creative ways to win. And that is the central tenets. is, is there a better way to win, correct? Yeah, and I mean, I think that it opens with that Mickey Mantle quote. The movie opens with the Mickey Mantle quote. It's like, you wouldn't believe how much you don't know about the game you've played your whole life. And I think that's what it forces Billy Bean to reconsider baseball from the ground up in a way that people don't want to do.

Once you've learned about something and spent years working on something, you're mentally resistant to rethinking it entirely. You're like, no, no, I get this. I've done this. I know how it works. And whether you consciously realize it or not, I think you build up a lot of resistance to new outside the box kind of thinking. And that's the real challenge is he's forced by these circumstances to throw out everything he thought he understood about how to put together a good baseball team and break it down in this completely different way.

And I mean, then we get to all these scenes where, you know, he's got this room full of old guys who've been doing this for 40 years and think they know everything about. baseball they've seen thousands of games thousands of players and they're using this very you know vibe based emotional kind of judgment where it's all subtle little things that they know to look for that they like like he's a hitter he's got a good swing or yeah let's play that clip this is like showing you how it's currently done yeah yeah what do you got i like geronimo yes Guy's an athlete, big, fast, talented. Top of my list.

Lean cut, good face. Yeah, good jaw. Five tools guy. Good looking ball player. Can he hit? He's got a beautiful swing, right, Barry? The ball explodes off his bat. He throws the club head at the ball, and when he connects, he thrives it, it pops off the bat.

You can hear it all over the ballpark. A lot of pop coming off the bat. An ugly girlfriend. What's that man? Ugly girlfriend means no confidence. Okay. Ah, no, you guys are full of it. Artie is right.

He's got an attitude. An attitude is good. I mean, clean cut. An 80-year-old man saying a guy looks clean cut. It's so cut and dry. Like, that is how these decisions have long been made. But we all can sort of come in and recognize, like, there must be a better, more effective way to make these kinds of judgments using some kind of empirical database, quantitative, you know, instead of just going by an old man thinking a young guy looks clean cut. In his face.

I mean, and they really nail that it's an old man because he's literally got a hearing he does. He's got to hear it. I mean, they cast that scene beautifully. All those guys look like, and you believe it to you, buy instantly. This is a room full of salty old baseball experts who've been doing this their whole lives. And the room looks old. They've got stacks of paper.

It's literally, there's a paradigm shift waiting to happen. And they've shown you, here's the paradigm, the current paradigm. And then you see Billy Bean, who's younger, like, half the age. These people are 70 years old. Billy Beans, you know, like 40 in this film or so. And then you've obviously got somebody who's even younger. So this is a generational shift that's occurring. Billy Bean is, you know, at the center of it. And he has to push the paradigm shift. And I also thought about technology at this moment. When I came into the industry, client server, and then PCs happened. And then cloud computing happened. The internet.

All of these paradigm shifts, I watched people fight them. And this movie, at its core is about a paradigm shifting. And what I learned in psychology when I was a psychology major at Fordham University is that one of our professor said, one thing you should know about paradigms and psychology is that paradigms don't die, people do. And all the people who believed in Freud or Skinner

or cognitive behavioral, Carr Young, whatever, they just died with their paradigm. And then the next paradigm happened when we went from, you know, uh, you know, Freud to,

to behaviorism to, cognitive. It's just, and that's what's happening here. It's such a great moment. It made me think to a Blackberry when the Blackberry team are watching Steve Jobs demo the first iPhone, and immediately they're like, but it's got no buttons. We all know buttons are what make the pop of the button. That's what makes it satisfy. That's why you know you press the button. And so immediately they're just like they're refusing to make that shift. And it's the same thing with these scouts where rather than even hearing them out. They don't even hear him out.

What can we do with the stats? What can you determine with the data? They're right away like, no, no, no. The only way to do it is to trust me, looking at the guy and whether he has an attractive girlfriend. Yeah, and a face. He got the face, you know? And that's interesting, the pop of the black prey keyboard,

the pop up the sound of the bat. Yeah. When people are confronted with a paradigm ship, it is so threatening to them because they've existed in a world where this paradigm has served them well. If you're 60, 70 years old and you're in that room and you've been in that room for 40 years, scouting players,

the ability to shift to the next thing is so hard. It's so threatening that you won't even consider it. And for the BlackBerry, those people, that was something that happened over a decade. That wasn't something that happened over five decades. Yeah.

That was a 10-year story. Oh, hey, we had the Blackberry. We were King of the Hill for 10 years, and then the iPhone became King of the Hill for 10 years. They couldn't make that jump. Paradimes are super powerful. One of the things you can do when you see a paradigm shift is, and this is something I do in my career as an investor,

and then also as a media executive, I assume the next paradigm will win. I just make that assumption. So when I was doing print magazines, I just assumed email newsletters would win, and I started an email newsletter at Silicon Alley. Then I assume blogs would win. Then I assume podcasts would win.

And people are like, oh, my God, you always figure it out. And I'm like, well, you know what I do? I just assume the next thing is going to work. And if it doesn't work, well, okay, fine. What did you lose by assuming it would be win? You know, I assume podcasts would win 13 years ago. Ape sitting around, you know, whatever. Yeah, and you know what?

You could make the mistake. You could say crypto is going to work and you make the mistake. Who cares? Just move on to the next thing. So it's just pessimism, you know, you get to be right if you're a pessimist, but if you're an optimist, you can get rich, right? So just be a little optimistic. and you might just hit the ball out of the park. Let's keep going.

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At this point, being to see, you know, he's made his mind. up that he's got to change something. He doesn't know what it is quite yet, but he knows if we play like the Yankees, if we think like the Yankees, if we keep trying to beat the Yankees at their own game, we're going to continually lose to them because we can't, we can't outspend them. So we have to get crafty. We have to get clever about, you know, what we do. So he goes to the Cleveland Indians. He goes to Ohio to meet with the Indians to discuss possible trades, just trying to mix things up a bit. And while he's there, he's about to close a deal, but then he notices that the GM, the Indians GM is listening to this guy who he doesn't

recognize this, this low-level guy named Peter Brand, played by Joan Aill. And he notices that the deal gets thrown off because of something Peter Brand whispers to his boss and he doesn't understand what happened. So he goes to the guy's cubicle. He tracks him down in the office. That's another, I think, little mini lesson here is Billy Bean just he won't, he doesn't, he's not deterred, he doesn't take no, it's that same persistence lesson from the founder. A lot of people might have been like, I wonder who that guy was. Oh, well, or called the GM of the Cleveland Indians the next week and be like, what did that guy say to you? But he just goes down, tracks the guy down in the office, sits down at his cubicle.

Such a good callback because in the founder, the Ray Crock story about McDonald's, somebody orders all those mixers. And they're like, who in their right mind is ordering six mixers with six, you know, the ability to do six milkshakes at a time, 36 milkshakes. This makes no sense. and he he has to go investigate it when he finds out that it's not a mistake, that order, that's real. And it's that persistence and that, what would you call it when you're curious, that curiousness, right? I think almost every story like this has that moment of the person makes, it's one thing

to make the observation. Like, I don't know, this is interesting. I don't understand quite why that's happening. This is curious to me. But it's a very different thing to then pursue the answer relentlessly until you find it. So you have to follow your intuition. Yeah, and I think that that's the thing that Billy Bean and Ray Kroc definitely have in common is he tracks, he goes immediately to Jonah Hill's cubicle, he sits down, he gets in the guy's face, the guy obviously is uncomfortable, doesn't want to talk to him. My boss is right over there.

Who are you? I shouldn't be giving away these secrets to a guy, I don't know, but he basically pressures him into explaining himself. Like, what did you tell your boss? What am I missing? What do you know that I don't know about baseball? and he ends up getting getting it out of Peter Bridges, just peer pressuring him. He ends up getting him to sort of tell him about statistics and saber metrics and this new way of thinking about organizing your sort of baseball team. And I think this is a great moment to play the clip.

And after this clip, I'm going to tell you what I took from it as a business lesson. There is an epidemic failure within the game to understand what is really happening. And this leads people who run major league baseball teams. to misjudge their players and mismanage their teams. People who run ball clubs, they think in terms of buying players. Your goal shouldn't be to buy players. Your goal should be to buy wins. And in order to buy wins, you need to buy runs.

And there it is. That is an example of what we call in our industry, first principle thinking. What exactly are we trying to accomplish here? And he walks people through it in this amazingly powerful scene. And you find yourself nodding. Okay. Your people are buying players, but why are they buying the players?

Oh, and what you're actually buying is you're trying to buy runs, et cetera. And you're not trying to buy wins or players. You're trying to buy these runs and getting people on base. And then they kind of even break that down more. It gets a little technical in baseball, but you're looking for people who have O-B-P, on-base percentage, right? And you can get on base a couple of different ways. Like, you can get on base by walking. And so they talk about getting a walk a lot in the film.

They dip into, hey, how that first pitch is super important. If you get a strike on that first pitch or you get a ball, the next pitch and what you hit is super important. And this is something called Sabre Metrics, which is a statistical analysis of baseball made famous by a statistician named Bill James. but I was super interested in this because there is first principle thinking. And if you think about startups, lawn, and I talk to startups about this a lot, you're building a team, right? Okay, what does the team do?

Well, they build a product. And what does that product do? Well, I like to say it delights customers. But if you break down what delights customers, there's a lot of different ways to do that line. You could save them time, you could save the money, you can entertain them, you can give them some kind of social acceptance, like make them become part of a tribe.

You can allow them to find a mate. There are biological things like shelter food, what are sacks? You get the idea. And there is higher level goals like purpose. So what you're trying to do is fill some need that humans have through a product that's created by a team that generates revenue.

That is a business. That is a startup. But first principles thinking would be, I need to get from point A to point B, how do I move myself or move this book. Moving myself would be Uber. Moving this book would be Amazon. You get the idea. I did have a question for Nick here, too. It feels like Peter Brand's philosophy, I don't know enough about baseball. It feels like Peter Brand's philosophy is really undervaluing, if not

throwing entirely away, the concept of fielding, playing defense. Like, he's only focused on hits, getting on base, earning runs, only on like outscoring the other team. And you don't really, in the movie at least. You don't really deal with the other side. And he's doing things like, put that guy at first base because I like the way he hits, even though he doesn't know how to play first base.

The first base example is the one they use in the movie. What, uh, the reason that they use first base is because I believe first base is actually the least valuable defensive position in baseball. You need to do the least at first base. I think they say that at one point. Yeah.

So actually there's three positions in baseball that are incredibly valuable on a defensive basis. Center field, obviously you're covering the most range in the outfield. Shortstop, you're like getting all the balls towards your way. You're the hub. Yeah, exactly. Derek Jeter, et cetera, et cetera. And then catcher because you're like sort of the field general.

Those are the three most defensively valuable positions in baseball. They actually don't talk about catchers or center fielers or shortstop at all in this. So I wonder if they were talking about whoever the shortstop was on the A's, they would be. I think they have their example is Hattiesburg. And so they talk about him. First base, right, exactly. He was a guy who was a catcher. That's what he knew how to play.

But they liked the way he hits. They like the way he gets on base. And so they put him in a different spot. I just didn't know if it was, it doesn't matter as much playing defense or if it was like, just in this particular scenario, it didn't matter. Yeah, so they don't bring it up in the movie at all. But the holy grail of Sabermetrics, at least in the modern day,

is something called war, W-A-R, which stands for wins above replacement in baseball. And every major sport has one of these now. So the NBA, Jason, you might know, has VORP value over replacement player. Basically, how much better are you than the average player at your position? Baseball's addition is war. The NFL has their own version. Hockey has their own version as well. So that's really what they're looking for.

So depending on what position you play, as long as your war is high, then you're valuable on a Sabermetrics basis. Okay, that definitely answers. That makes a lot of sense to me. A lot of founders are great at going from zero to one. This takes vision, it takes creativity, and most of all, it takes a bit of hustle. But those same people can often struggle going from one to a hundred to scale efficiently. You're going to need process.

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That's Mev.com slash twist for $30,000 off your first three months. All right. So, Bean, at this point, basically hires brand. right? Right. Well, we also, this is the point of the movie where this is our movie where we start doing flashbacks as well because we sort of set up what makes Billy Beam the guy who did this and why is this his sort of, you know, what makes him sort of specifically the guy

that this spoke to and we kind of find out that, well, he was a very hot prospect coming out of high school and he had this huge decision where the scouts were encouraging him to go pro immediately. But his parents were kind of like, well, you should go to stand. You can play ball at Stanford and get a college education. He ended up listening to the scouts and then he totally bombed out of the MLB and did not play well in the majors. Ended up, you know, finding a new career as a scout and then a GM. So it all worked out.

But he still got a lot of resentment about scouting and the way that the system works back then because he ended up being such a letdown. And we get stuff about him feeling like he's personally cursed and he doesn't watch the games in the stadium. and he can't even bear to listen sometimes on the radio. But I think, you know, that's the idea that he in particular was a little bit skeptical coming in about scouting and recruiting and the way teams were assembled. And so when Peter Brand sort of presented this idea to him, that's why that was the lightning bolt moment of like, this is what we've been getting wrong all along. Yeah.

And it takes somebody sometimes who's, you know, sitting between the two paradigms, right? These two mountains. the old school way, it's a, like a, it's a personality-based thing, and then it's a metric-based thing, and he was able to cross that chasm, yeah, as it were. And so, you know, so now Brand works for Bean as the sort of assistant GM at the A's, and we get a lot of, you know, scenes about how it's an odd bit. Like, he does it, like, there's a lot of conflict right away, and that's maybe what the guy who Jonah Hill is based on was saying, like, he didn't really feel like there was a lot of conflict when he's, he didn't really feel like there was a lot of conflict when he's. came in, but the movie has to make it look good. So we get, you know, he's kind of like, people are having a lot of trouble adjusting to this

statistical model that he's built where he's describing, you know, undervalued players and how they're going to go and purposefully seek out these sort of like players who other people don't understand why they're more valuable than they may initially seek. He calls them the,

he calls the team the Island of Misfit Toys. Let's play this club. This is a great scene. You're doing at least 99 games in order to make to the postseason. We need to score at least 814 runs in order to win those games and allow no more than 645 runs. This is the code that I've written for our year-to-year projections. It's about getting things down to one number.

Using the stats the way we read them, we'll find value in players that nobody else can see. People are overlooked for a variety of biased reasons and perceived flaws, age, appearance, personality. of the 20,000 notable players for us to consider, I believe that there is a championship team of 25 people that we could afford because everyone else in baseball undervalues them. Like an island of misfit toys.

I mean, such an inspiring scene. They put that great music in the soundtrack was great. It speaks to people because maybe we all feel at times we're undervalued, right? Or underestimated. I thought this was like a really great moment. Just the way that, yeah, the way that these sort of biases conscious and unconscious sort of play out in the real world and like, yeah, of course, reducing people to a few personality traits or the things you could tell during a job interview like that, that never tells the whole story. And we all, I think we all kind of know that. Let's have a DEI debate for 20 minutes now. Oh, please, please, please God know. Should we put them behind a screen and just look at their metrics? Can we get Sacks? Can somebody call Sacks? Can we get him in here? Somebody gets Sacks, Mark Cuban, you know, we'll all get together. I'll just talk about D.E. I mean, it does relate to we want to not be judged on our quirkiness.

Or do we look like a baseball player, right? Is this an athletic, white, whatever, looks like a baseball player? Because, you know, they have one point where they have somebody who's a little bit overweight, who hits a home run in the film, you know, and they just talk about how like, you know, maybe you don't look the part, but you are the part. And they bring up this guy, Chad Bradford, who's a pitcher who's super undervalue because he throws this, like, really weird. like sideways low pitch,

but he's got solid stats and he's worth $3 million, but they can get him for $8.50. And this has really spoke to me about resources. Again, back to startups. We're here on this weekend startups. And one of the things I'm watching startups do is,

as we globalize, they're looking at people in San Paolo who are developers and comparing to developers in Toronto and comparing those developers to ones in Miami, Austin, and the Bay Area. And people are starting to say, hey, you know, I'm managing a remote workforce. Is this person in India?

Is this person in Manila, you know, as good as this other person? Or are they undervalued? And that globalization that's occurring in the workforce right now is really inspiring to watch people get opportunities to work at big companies from all around the world. And then some people are overpaid because maybe they have some Ivy League degree or pedigree. And maybe that's unfair. depending on which time of the equation you are. Somebody gets an opportunity, somebody loses an opportunity.

Yeah, I mean, I think that it turns out a lot of these sort of old rigid ways of thinking about who can do what and who's appropriate for what job really didn't make a ton of sense. It were just things that people thought that got passed down generationally that weren't necessarily true. So I think, you know, that's one huge advantage that they have is like, well, when you break it down as pure numbers, you're seeing things in a way you couldn't when you're looking at players on a field and you're trying to make subjective judgment calls about.

And this is when Philip Seymour Hoffman comes into the picture, which is awesome. Yeah, so Art Howe is one of these the A's coach manager, I guess you'd say at baseball. And he's one of these old school guys that has his old way of thinking of things. And you know, he's paid for his expertise. So he doesn't think

he should have to listen to this new way of doing things. He's like, you make the team, you give me the team. I'm going to play them the way I know how to play players on the field. But that I think this is one of the big sort of lessons of the whole movie is you can't piecemeal it.

You can't have some members of the team doing it one way and other people doing it another way. Everybody needs to be on the same page and running the same playbook with a consistent vision or it doesn't work. And that's what we see sort of happening at the opening is just he's getting, even as

Vili Bean is putting this team together and starting to execute on this new strategy, his team is rejecting it and he's having a lot trouble sort of managing them and getting everybody on the same page. So there's a scene where he's in a meeting with his scouts and he's trying to explain to them what Peter Brands been explaining to him and we got to figure out getting guys on base and everybody's just sort of shouting him down and making all of these objections.

Yeah. And that's a great scene in and of itself is people wondering why. Why do we have to have these players? And you're so right. Let's play this clip and then I'll give some feedback. Billy, we got 38 home runs at 120 RBI. Guys, we're still trying to replace Giambi. I told you we can't do it, and we can't do it.

Now, what we might be able to do is recreate him. Recreate them in the aggregate. The what? Giambi's on base percentage was 477. Damon's on base, 324. And Almatis was 291. Add that up, and you get... 1092.

Divided by 3. It's 364. That's what we're looking for. Number one, Jason's little brother, Jeremy. Tell you, if I may. He certainly has had his problems off the field, and we know what he can't do on the field. You get a little thicker on the waist.

And his reports about him on the weed and the strip clubs. Well, his on base percentage is all we're looking at now. And Jeremy gets on base an awful lot for a guy who only costs $285,000. There you go. And weed and strip clubs, I don't care. Yeah, right. That's on base. It's math.

That's the way they're thinking about it is like, ah, he's got a little punchy and he likes strip clubs. No, go with somebody else. And it's like, that's a classic example of those. Are those really impacting his play?

Or are you just sort of prejudice against people who act that way? Can I play devil's advocate here for a second? Yeah, let's go. Okay. So I actually thought the movie did a really good job at showing that there has to be a balance of both of these things because you see later in the movie, Jeremy Giambi is being obnoxious in the clubhouse when they're losing.

He's playing music. He's dancing. Billy Bean comes in, smashes the stereo, and then he trades him a couple of days later. He's like, get this guy out of here. So while I do think, of course, you need to look at analytics and you need to understand really what you're trying to do and how you're trying to win, there also is a balance where you need the right people in the clubhouse, especially in a sport like baseball, which comes down to just a couple of games at the end.

And like when he goes to David Justice, and he's like, listen, I know you're old, but I need you to mentor these guys. I need you to be a role model. And then he starts taking Hattaberg under his wing, et cetera, et cetera. So this is back to the qualitative nature of the, individuals versus the quantitative and your point line, you got to have people roaming in the same direction. So if somebody statistically can do the job, but they cause other people to not do the job well,

or they statistically are trailing off, but they make other people good. That's another startup lesson, isn't it? Yeah. Yeah. Well, that's, I mean, because like, there's a lot of scenes that are sort of coming up at this part of the movie where Art Howe is not playing the players in the right positions or in the order that they need them to play. He's kind of making his own calls at the last second and putting the team back in the old order. And that's, you know, causes this big losing streak. And they're sort of, they have all of these problems coming out of the gate because they're trying, they're organized based on Billy and Peter's concept. But then they're being run by arts idea.

And that's really where it's like, you can't have that. Everybody needs to be whether, you know, they agree. If people don't agree and they can't execute the playbook, they got to go. Everybody's got to be moving in the same direction. And in business, this happens in startups, it happens all the time. And the way you handle it best is to say, listen, there are two or three different ways to actually run this company. We could be an enterprise company. We could be a consumer company.

We could be a marketplace. You know, all different ways in which you could execute on the same business idea to solve the same business problem. Here's the one we've chosen. Here's why we've chosen it. And now we're going to execute on that. You may disagree. If you disagree so strongly that you're not willing to do it, then you can't be at the company. but if you disagree and you think your idea's right,

well, let's just all put our effort into choice A of how to run this business. We're going to make it an enterprise business. Oh, you want to make it a consumer thing? We're going to do enterprise. You know, either you have to leave the company or if you're going to stay at the company, just put your best effort into doing that.

And you can monitor the decision and always change it. So this is a really great, I think, moment in time. Yeah. So in the movie, they go to Scott Hatterberg's house. They tell him this weird plan that he's a catcher. but they want to teach him how to play first base. And, you know, he's got this injury that's preventing him from being able to do the catcher role that he used to do.

So as far as the rest of the league is concerned, he's done. Nobody else is interested. This is really the only offer on the table for him. So even though he's hesitant and he's confused, he accepts anyway. And that was an early Chris Pratt role. He was mostly known for, I think, Parks and Rec still when he, this was pre-Marville, Chris Pratt. Yeah. So we get a little bit of a little bit of.

of the subplot with being in his daughter, you know, a little bit more speaking to his, his lack of confidence and how he feels like maybe he's cursed. And then he's confronted once again by his head scout. This is a guy we've seen him clash before, clash with before in the room. And he's really, as strongly as it's yet been stated,

the baseball isn't about numbers. Baseball is a game that's about all of these intangibles and variables and all these things that only I understand is an old school expert. Let's play. It's just an utter rejection of Billy's concept. Yeah. You don't put a team together with a computer, Billy.

No? No. Baseball isn't just numbers. It's not science. If it was, then anybody could do what we're doing, but they can't because they don't know what we know. They don't have our experience and they don't have our intuition. Now, there are intangibles that only baseball people understand.

You're discounting what scouts have done for 150 years, even your self, adapt or die. Yep. It's really that simple. Adaptor or die. If AI is here, if mobile is here,

if cloud computing's here, PCs are here, broadband is here, the internet. People didn't think the internet would take off. They thought it would collapse under its own weight

and they thought you would only have proprietary services like AOL or Prodigy, Comp you serve, and you know, you had to adapt and die or die and use open standards.

So such a great scene and such an obvious business lesson. when the paradigm shift happens, you gotta like adapt or die. And in this case, I think that scout gets fired, yeah, on the spot. Yeah, Billy's like,

I'm not gonna fire you, and then the guy tries to smack him, and then he fires. So then there, we jump to spring trading, and there's a montage of, you know, look at your classic baseball movie.

They're not, they can't get it together. They're the bad news bears. They're the Indians at the beginning of major, league. I mean, you know, take your pick. And then the season itself starts slow. And again, we've talked about this a little

bit where it's the clash between Bean and Art Hal, where they're sort of debating how to run the team and there's this little sort of power struggle going on there. Bean, you know, like everything's going bad. The team's going really poorly. The A's are

continually losing. And during this time, Bean is also sort of mentoring Peter Brand, showing him what a general manager's job is all about. getting him used to sort of the day-to-day of managing a team and running a team. And that includes teaching him how to cut players when they are being dropped from the roster. And I thought this is particularly important. You know, we're taping this a week in 2024 where in this era, people are being cut,

being laid off, right? Tragically, there's a ton of rifts going on. Whether it's in media, LA Times, just cut 100 positions or something insane. 115, I think. Yeah, I mean, just, whoa, that's a big number for a media. a huge chunk of their total staff. It's like 20% or something, 15%. And that's after two riffs before that.

And then Google still cutting people. You know, Microsoft still cutting people last week. Yeah. So, you know, people keep getting cut here. And the trend has been people are recording themselves on TikTok, which is also weird. But putting it aside, we live in this weird world where people are being cut and they're being cut on Zoom, right? And HR people are cutting people with this like HR speak.

that's obviously written by lawyers and not able to answer questions. And then how do you do it in a kind way? How do you do it professionally? Has become a big question, right? And there's no easy way to do it. But Billy Bean says, be straight. No flaw. Just facts.

Let's play the clip. I'm a player and you've got to cut me from the roster. Fine. Billy, please have a seat. I need to talk to you for a minute. You've been a huge part of this team. Sometimes you have to make decisions that are best for the team. I'm sure you can understand that.

You're cutting me. I'm really sorry. I just bought a house here. Well. In Oakland. Oh, uh, well... Well, that's all you got to say? My kid just started a new school.

Well, you shouldn't pull them out in the middle of the school year. You should wait. What the hell are you talking about? I don't know. I don't know. I shouldn't have... I'm not gonna do this. I don't think this is stupid. I'm not gonna fire anybody, and this is dumb. They're professional ballplayers. Just be straight with you.

them. No fluff, just facts. Pete, I got to let you go. Jack's office will handle the details. That's it. There it is. I think people appreciate that. And he tells them, like, would you rather a bullet to the head or five to the

chest and bleed to death? Pretty graphic. But I do think being straight with people, the business isn't doing well. We have to cut 10%. We have to cut 20% because we're not profitable. Here's Susan from HR. Yeah. Every time one of those clips goes viral of like person being fired in a horrible way or firing goes terribly wrong, it's always because they're trying to do too much.

It's never just because it's like the simple, clean, straightforward. I mean, I've only been, I think, fired from one job. And yeah, it was very, it was very matter of fact. It was like, we're going a different way. Here's your last paycheck. Have a good luck with whatever comes next or whatever. Yeah. And you felt respected in that moment or at least not.

pander to or. It's nice to not, it's nice to not have somebody giving you a whole, oh, you're so important to the T, because you know that that's not genuine. If you were that important to the team, they wouldn't be firing you. So, you know, like it just, just, just, just rip off the bandaid. I agree with Billy Bede. Yeah. And then this is important to juxtapose with these.

And then some people are giving people a whole, like, you didn't work hard enough or it's on you. It's your fault in some way. And it's just like, whoa. Yeah, definitely don't do that. Yeah, definitely don't do that. Just be a matter of fact about it. So, and dramatic foreshadowing,

Jonah Hill's got to go, cut somebody later, and he does it exactly as prescribed, and it works perfectly. Or it goes as well as it could go. The lesson is learned, yeah. So another part of the training is Bean has him start traveling with the team. And this is when the issue of soda and the clubhouse comes to head.

The A's, I was reading about this lovely stadium you see behind me, the Coliseum in Oakland. One article called it the last baseball's last dive bar. There you go. But whereas a lot of professional ball teams like the Yankees,

they stock the fridge for the players. If you want a soda, there's just soda there. The A's, you got to pay a buck at the vending machine if you want a soda. David Justice, who is a veteran of much bigger market teams, He's not a fan. So while Brand is on the play next to him going to the next game, he sort of has,

hey, I don't like, you guys should, you guys should pay for the soda. Brand is like, Billy likes to keep the money on the field. You know, justice is pretty skeptical that his Dr. Pepper's going to make a huge impact in the season or whatever. But that's important foreshadowing. I think this comes up later, the sodas. Can I button cut button in here, please? Yeah, this just fuels my fire.

It hatred in my heart so much. that there are owners that legitimately cannot afford. Because every major sport, I think, I know baseball does, have something called revenue share, where about half the revenue at the end of the year is all put into a pool, and then it's divvied up equally among the 30 owners in the MLB. The NBA has the same thing, right? Jason, you remember Donald Sterling on the Clippers. He was, what was he famous for?

He had the lowest salary in the league every year and he just raised all the revenue share. Exactly. And he never paid for players. If you cannot afford a baseball team, sell the team, please. you can't afford to give your players drinks and Gatorade, get rid of the team. Yeah, I mean, it's pretty straightforward here. And Sterling was the reason they put in a minimum. They said basically in the NBA, you got to spend at least this much.

So forget about a cap. They put a floor in because he was like, yeah, just you want Elton Brand or any of our stars, any of our recruits, take them all. We're going to spend $40 million and we're going to rake the other $40 million in his profit. And they're like, hey, you got to get a little higher up here. but then they go on a terrible losing streak. They've lost 14 of 17 games. It's not working, right, Nick? Right, Alan?

It's not working. Yeah, I mean, at this point, and I mean, you know, in this sort of an environment where you're trying something very bold, daring, new, people are just waiting for you to fail. So I think there is a sense that this was like delicious for a lot of people in the sports world. They couldn't wait for this thing to blow up. And then it does in this very dramatic fashion, it feels very satisfying.

So yeah, there's a lot of, you know, media sort of taking a lot of pleasure in the A's doing terribly in this whole experiment, not seeming to work. Bean and Brad go talk to the owner about why the team's doing so poorly. Brand is like, we're on the right track. We just need a larger sample side. I just, you know, like, this is just, we're having a bad streak. We'll have a good streak. It's going to work. We just need to, like, figure out, you know, some of the details.

And around this time, Bean also tries, you know, he's still fighting with Art, how the manager about how to organize the team, who's going to play first base, how keeps playing this guy Carlos Payne at first base instead of Hattieberg, the guy they picked up specifically because they like his on-base percentage. And it's messing up the strategy. I mean, from Bean's perspective, this is why it's not working. Like, we're doing everything on our side. you're not executing on the day.

So what he does is he decides to mix everything up and take a lot of this power out of Art House hands. And he does that by getting rid of Carlos Pena. And also, as Nick mentioned, this is also when he gets rid of Jeremy Giambi for partying too hard at the clubhouse. And he also, this is the point where it becomes, it would have been really easy to back off

to say, you know, I was wrong, mea culpa, we tried this thing. We're in the arena trying things. This one didn't work. We're going to come back. You know, like I'm going to, we'll remodel. It would have been much easier to do that. But instead, he believes Peter Brand, he believes his original idea, and he sticks to his guns

and he tells Brand, we don't need to explain ourselves. We're going to see it through for better or worse. And then the other thing I want to mention, when he makes this trade to get rid of Carlos Pena so that how doesn't have the option to continue playing him, that's when he figures out how to get three years of free sodas for his players as part of the trade. And I'll play the clip and then I'll watch. Okay, that'll work. Great.

I need one more thing. Soda. Yeah, I don't want my guys paying for soda. I want you to stock my machine for three years. I'm serious. Great. It's a deal. I mean, totally ludicrous, but great, like, showing he's evolved a little bit, right?

Billy Bean has evolved. I'll see, it's a very important moment here. We call this the burn the boats moment. If you haven't heard that expression, hey, you get to the new world, you burn the boats, you're not going home, you're going forward. And in business, sometimes it's important to commit. You have to commit.

Just like skiing down a mountain, you're going down certain trails, you just got to go for it. And that's what he does here. He burns the boats. We're not going backward. We're pivoting. We're shutting this down and we're going this way.

It's a burn the boats moment. moment. And, you know, he basically gives Art no choice. And I love the moment where he's like, you're not playing him on first. And he's like, no, I'm playing him on first. He's like, you can't play him on first because I just traded him. Such a great moment. And then, you know, art basically has to accept the fact. And art, to his credit, makes the paradigm ship. He decides when the boats are burned, that he's going to make the best of it. And then, of course, they're right, but it's such an important persistence and commitment. If you're going to pursue this new strategy, you have to give it your all.

And sometimes you've got to burn the boats. But I love that to the two of the balance. It's not just, you know, you've got the vision. You see the light on the horizon and you're not listening to anybody. He is listening. He's just committed to the vision. And he's, so he's hearing all the feedback. He's not blocking it out.

He's just, you know, using what he can and remaining. admitted to his vision because he does, he can't take care of the soda thing right away, but he keeps it in the back of his mind. And then when there is an opportunity to fix that problem, he does. And I think that's such a, that's why that's in the movie is to bounce it out. Like, it's not like he's not listening to anybody and he's totally single-minded. It's just, there's a lot of dissent that he can't use. When the feedback is useful, he's still hanging on to it. So he's evolved as a character as well. He's not, you know, unchangeable. He's going to evolve. He's going to change his position on things, which is just great for the

storytelling as well. A lot of managers might have just blown off David Justice. He's a diva who cares. He could, he's a millionaire. He could pay for his fricking sodas. Yeah, I'm paying him seven million. Right. But Billy Bees like, it is important to keep the players happy. You don't want something as simple as a Coke to throw off this guy's, you know, state of mind or willingness to play or whatever. And this is critically important too. When you are a leader, you know, what matters to the troops, and if it doesn't matter to you, sometimes you got to meet them where they are, right? And so you want to win the war. Um, and, you know, sometimes you're going to lose a battle here over sodas, but you're going to win the war that everybody buys in. And Peter Brand then starts explaining the basic baseball to the A's players that walks are the same as singles, which is what my coach always told me when I was in the Little League in Brooklyn. Me too, actually. I thought of that too. When I played Little League, yeah, they used to tell you like, don't, don't feel like you got to. swing at everything, like a take, you know, walks are as good as

in my case, I realized early that leaning in you could get hit. And so I, I wasn't playing, I wasn't playing at this level. I started leaning in so much. I'm talking, this is like second third grade, that I, um, caused a little bit of a scene because I leaned in and purposely got hit with it and they threw me out of the game in Brooklyn, in Bay Ridge, Brooklyn. I'm not, I'm kidding you not. And they reprimanded the coach, hey, of the sparrows, listen, what are you doing?

Somebody's going to get hurt here. you're telling your place and Lee I said he didn't tell me to do that I was just leaning and I was talking about the guy's like listen kid he knew I was lying through my teeth I just wanted to get out face I wanted to help the team lead into it

but you know longer at bats are great because they increase the pitchers pitch count this is such a critical thing so if you can keep hitting those you know foul balls man that wears a pitcher out over time and then yeah I mean all of these things are just yeah like

thinking about the game on like that deeper level of rather than just, you know, like the way everybody sort of approached for a long time, like a little bit more of a regimented strategic kind of approach to everything you do on the field, every app, bat, every play. And that's really what brand I think is sort of introducing. And, you know, like heat zones and all those sort of. And here's the thing. Details matter.

And if you want to make a service better, sometimes it's easier to make five things, 10, 20 percent better than to try to make something 50 percent, one, they 50% or 100% better. As in one example, when Google made their search engine a little bit faster, every time they made it a little bit faster, the number of searches people did increase. If you look at Uber, when they brought weight and lift, when they brought weight times down, people started using the services more. They became reliable.

And that's why liquidity in those networks was so important to them. So there's little things that you can do and they add up to a better experience or more winning. and that's where details matter and trying to optimize a bunch of small things is what happens to this team. And it's just so, so applies to product design is making a lot of little things better. This was a product design moment. So, right. So all of these sort of elements come together, figuring things out with how running the team

better, you know, having these kind of conversations with the players, bringing everybody onto the same page, finally. And they start to wit. They start to sort of turn. things around with the season. The trade deadline approaches and Billy decides he wants Ricardo Rincon a relief

pitcher to come join the team. So he executes that trade. And then once the trade, the deadline is passed, the A's go on this crazy all-time, historic winning streak. Ultimately, they win 20 games, but we kind of play it out for maximum drama. So we sort of follow Billy during

all of game 20. As I mentioned, he doesn't, he thinks he's a jinx ever since his failed career as a player. He's convinced that the team will never win if he's there. So he always finds other things to do elsewhere and not be in the stadium during the team. But he's listening to Game 20 on the radio. The A's are up 11 to nothing. And so he figures, ah, there's no chance we're going to lose this one. So he turns around and he goes back to the stadium.

He does start watching the game live and in person. And they start to lose. They start to lose. and he feels like, you know, he's, he's duming it, so he goes back into the clubhouse and listens on the radio. And this is really, I mean, because of the way that the A season played out this year, this becomes the emotional climax of the movie.

Their big victory is this, they clinch this 20-game hitting streak or winning streak. And it's on Scott Hatterberg, he hits the walk-off home run that wins the game, you know, this kind of unlikely guy that the league didn't believe in. So that's kind of like, that's our big hero moment of they did it. They did this. They set this unprecedented record.

They matched, you know, they exceeded any American League win streak in history. And then they go on to lose to the Minnesota Twins of the first round of the playoffs. So it's a it's a bit of like a rocky kind of ending where they win the moral victory, but they don't actually end up winning the championship. They go the distance, basically. Right. Nick, producer Nick, I'm curious, having not watched this or remembering it. Is that actually how it went down? That's exactly what happened in real life.

I mean, I'm not sure about really being actually going to the game or not, but yes. Even as a non-sports fan, I remember the A's going on that crazy winning streak and everybody obsessing about it. I don't remember the 11 run comeback and this, you know, I didn't watch the game. But I do remember the, yeah, I do remember the Oakland A's going on this historic unprecedented. I have a movie nerd question for you. Yeah. So the trade deadline scene where he has like three phones and he's like, oh, pick up for John. He's like, which John?

He's like, obviously the John that we're not, we're not calling that other John back yet, right? They're just going back and forth like crazy. Aaron Sorkin co-wrote this movie, right? Do you think that scene was just in there for him to flex? Was that just like a sork and flex? Because there's like no payoff for it. Like, it never comes.

The Ricardo and Cohn never comes back. It just felt like such a sorkin, like, muscle flex, you know? I mean, I feel like, uh, definitely there's a lot of speeches in this that have a very, a very Sorkin flavor. It's a little social networky. Yeah, those are the moments where you could really feel his influence. I mean, we should mention the other guy who wrote it is Steve Zalien, who wrote Schindler's list. I mean, he's a legend in his own rights.

I mean, like, two, this was real, two heavyweights on this screenplay. Like, it was really, yeah, you could tell. Two legends. So Zalian also wrote Fableman's for Spielberg last year. I mean, he's great. Well, Sorkin, he's known for really like his dialogue is a lot of action, right? It's like very active and... I mean, the walk and talk is the thing people always associate with Sorkin.

Like West Wing, people walking down corridors and it's a lot of complicated ban... But also with that with that banter, you know, it's that mixture of it's everybody's talking fast. It's very detail-oriented, but it's also like everybody's got kind of a corky, funny way of speaking and they're very personality driven. And, you know, Sports Night, West Wing. I mean, that that's that classic Sorkan banter. but he also wrote, you know, like few good men. So a lot of big dramatic speech of buying. It's big, it's bold, it's action.

Yeah. And a lot of, he loves, loves a monologue. So there's a lot of big monologues in this movie that are like that, that feels vintage sort of me. He did the newsroom, right? Which was like monologue central. Oh, yeah. I mean, the man, the man loves a monologue more than maybe any other Hollywood writer today. He also did Molly's game a few years ago.

Yep. I mean. Jessica Chastain. The 25, yeah A really terrible Lucy and Ricky one last year The newsroom was I loved the newsroom I thought that was a great series

I don't know what happened to that It was only Was that two seasons maybe? I think they did two seasons in the news series Yeah looks like 25 episodes Jeff Daniels amazing Yeah Jeff Daniels really good

A little a little preachy A little A little A little heart on its sleeve For my taste But Sam Watterson Yeah

He was great Olivia Mum was actually good in that too. That was like one of her few... I think that the social network script is like a master. I think that's his greatest. That might be his greatest all-time achievement. Why? It's so complicated.

And yet it's the same thing Oppenheimer kind of does this year, where you're following all these different chronologies, different hearings, different moments in time. They're all overlapping to give you this kind of collage of everything that happened and it's thematically connected. But the way that he's able to keep you, you never like confused or, like, like, when is this happening or who's that guy? And there's so many moving parts. It's a huge achievement.

That movie's crazy. I think it's amazing. And Jesse Eisenberg is like, tailor made for Aaron Sorkin. Just the way he speaks, you know, and his like, frenetic kind of face. I mean, we're not,

we're not supposed to praise Army Hammer anymore, but he's also fit. I mean, it's just, it's so good. It's a great movie. I think we can separate the artist from the cannibalism.

I mean, he's selling, remembering that. that he wanted to eat people? I mean, he was accused of actual abusive behavior. But then also there were those text messages where he was telling women he wanted to eat them. Yes. Yeah, that's crazy.

Weird guy. Selling time shares in the Cayman Islands now, Army. Okay. The next island, Aaron Sarkin film. He moved on to his, he's on his next act. Okay, so let's wrap this up. So Billy Bean, courted by the Boston Red Sox after this, you know, landmark, amazing season.

season. They have the second highest payroll in baseball in 2002. And they'd also had recently hired Bill James, the creator of Sabermetrics, the statistical system Peter Brand was sort of basing his work on. So the Red Sox owner is basically like, you were the first one out of the gate. That guy always gets beat up. Nobody who's the first one up, the innovator always gets, suppers the pushback and everything. But it's obvious to those of us in the know that you were right and that this is where everything is going to be soon. And we all need to start doing what you did to put this season together. And so I want you to come work for me.

And he slips of a piece of paper that we later find out says 12.5 million, which would be the highest general manager salary in the history of baseball. But Billy Bean says, no, he wants to stay and win. He wants to win it all with the ace. He doesn't want to go to one of the big teams that can buy the championship. He wants to prove that he could do it for himself. And then we find out in a card that comes to the end of the movie, the two years later,

the Red Sox did go on to win their first World Series in 86 years, utilizing the money ball sort of philosophy that Billy had helped to sort of pioneer. And this is where there's so many business lessons. Number one, take the money. Just take the money. Number, yeah, don't be a hero. and the first guy up the hill

takes the arrows is also one of these things that happens a lot in the industry there were you know cab

ordering services that predated you know Uber there were devices that predated the iPhone like the Blackberry a lot of times

like you know people self-sabotage or they don't take the opportunity that's presented in front of them and you have the long history of this It's hard to know what you should do here. But if you know that you have the right technique and then somebody offers you the bankroll to execute on that same technique and offers you $12.5 million and you should take that.

Like this was a huge mistake, I think, on his part. Don't be a hero comes to mind. Well, I think also, I mean, to me the takeaway was also, not that I just, I agree with everything you say. But I also think know what success looks like when you start. Like when we hear a few different versions of this throughout the movie of what Billy is, what is he really want? What is the ultimate goal? And obviously to win a championship. But then at one point, he tells Peter Brand, rings don't matter.

Championships don't matter. But if we win with this team, we change the game. And that's what I really want. I want to change the game. So at the end, he didn't win the season, but he succeeded in that goal. The owner of the Boston Red Sox is telling him to his face. you changed the game, that's,

you would think that would be the ultimate win. That's the moment, but Bill, he didn't win the championship, so he still doesn't feel like he won. He still feels like the loser, the failure, the guy who couldn't quite get it done.

Yeah, maybe he is in fact cursed. But to me, I think like, but if he had set that as his goal, like I want, I don't want there to be teams like we were where they have no chance

and they just have to try to play this, this failing, losing game with players who aren't good enough. I want to change the game so that there's this alternate strategy that people use. He did that. He won. So he ends up feeling like not a success, even though I think you could argue that he even succeeded by his own definition

of what success was. So if you go into any project and you already know when this happens, when I win the Oscar, when I make my first billion, whatever it is, have that fixed in your mind so you know. when you get there because otherwise you're just endlessly chasing something you'll never achieve. Yeah, I think understanding what success looks like, setting some goals, hitting those goals, yeah, all very important.

Yeah. And, you know, the big takeaway for founders here in terms of the business breakdown and the lessons here, I think, is paradigms do shift. You have to commit to those and you have to convince the team to come on that journey with you. You need everybody rowing in the right direction. And it's going to be hard to change the paradigm. There's going to be pain.

There's going to be suffering. There's going to be doubt. People are going to try to stop you. People inside the team, the press outside the team, the doubters, the haters, your competitors. And, you know, it takes a lot of fortitude. It takes a lot of resilience. I think, as you pointed out many times during this discussion. But there is always a better way to do something.

There is going to be a paradigm shift. It's going to face everything. Right now we're facing it as an industry. The whole, you know, AI is going to change the entire playing field of employment. creativity, etc. To what extent? In what jobs? Who knows?

We'll see. But such a great inspiring movie. Watch it with your team. And this is our third business breakdown. You got the founder. You got the BlackBerry film. And now you got Moneyball. Three great films.

Watch these with your friends. Watch them with your team. And really, you know, you can learn a lot from the lessons out there. That is what I always try to tell people, you know, startups. the history of startups, like it may not repeat, but it rhymes, right? As, as we know about history. So this week in startups.com slash BB for business and I do one takeaway before we go.

Yes, please, producer. Okay. So my number one takeaway from this movie for baseball and for company building, sample size matters. The reason that analytics was adopted in baseball faster and more seriously than any other sport, they play 162 games. That's twice as much as that. the NBA, twice as much as the NHL, 10 times as much as the NFL. What does that mean? It means a guy can get hot for a couple weeks or they can go super cold for a couple weeks, but eventually everything

progresses to the mean. And if you were building a startup, I would say be in it for the long haul. If you have a great team, if you have a great product, if you have a great vision, the longer you stay at it, the more likely you are going to regress to the mean. And if you are mean is great, then that means you will end up doing great things. Yeah. Wow. It's a great insight about sample size for sure. And you hear it actually mentioned in the movie, Jonah Hill's character is like, listen, we don't have a big enough sample size.

It's only May. Why are you getting mad at us? It's only May. They're so eager at the start of the season to be like, it's not working. It's not working. Everybody wants to panic after 10 games, 15 games.

Yeah. Whereas with the NFL, it's much harder to people try it. But in the NFL, you can get hot and win five games in a row and all of a sudden you're in the playoffs because there's 16 games. It's just, yeah, it's such a small sample size.

And you do need to know, to build off what you're saying here. a very important takeaway is to understand what metrics matter. And, you know, in startups, what metrics matter, what are vanity metrics? The number of downloads your app get, that's not super important. The number of times people open your app and use it and come back to it or the average minutes in it, that's actually what matters. And so, you know, there's vanity metrics and there's real metrics.

Your valuation isn't as important as your earnings, your total cumulative downloads or your ranking in an app store, not as important as your average listeners who come back over and over again. Yeah, so understanding your North Star metrics and understanding which metrics to pay attention to, super important here. Everybody follow Lons, L-O-N-S on Twitter.

Everybody read inside.com slash streaming. His amazing newsletter and everybody, this weekendstartups.com slash BB. Thank you, producer, Nick. Thank you to the other producers. We'll see you all next time on this week's startups.