Mm-hmm

... workflows.

Um, so, and, and e-commerce is actually a big part of this too.

You know, a lot of the smaller contractors, residential GCs, they're already Home Depot is their primary just-in-time supply, and increasingly, like, their main supplier.

But if you think about, like, really big builders, multifamily, commercial, you know, cranes, all, uh, big stuff, um, historically Home Depot has not been penetrated into that.

You wanna tell the store opening?

Yeah, yeah.

So I don't know about the smell today.

That they keep shooting us with, yeah.

Yeah.

Um, so that wasn't great.

Uh, and then two, you're right, they're probably five years too late to launching their own streaming service 'cause imagine the subscriber count that Disney+ could've been at.

Let's say where they were, COVID accelerated a lot, so let's, let's not say five years, but let's say they could've been at the current numbers by 2023 instead of 2026, then they could've started doing this bundling thing that they're obsessed with now, and that everybody's getting obsessed with now, earlier.

And assuming the future of Netflix and the future of Disney are, are both being the distributor and then getting other people to distribute their content on their streaming bundle, uh, they could've been in a, a better position, whereas now it feels, uh, very reactive, and there's a, a danger that it is creating brand risk to, to put all these other things so close to, uh, Disney IP.

Sure

... sports networks, so it ends up being, like, s- high 40s or something like that.

But I think one of the challenges that we see in organizations is, how do you help to drive the uptake of those use cases or the initiatives around AI, and think about what those accelerators might be? Do, do you have sort of ways that you accelerate uptick of d- uptake of different AI uses, or maybe on the flip side, are there blockers that you have to really keep an eye out to overcome?

At a really high level, um, our approach is to bring in a culture that rewards curiosity and experimentation.

Um, it redefines failure within appropriate guardrails and kind of drives that psychological safety, and that, that's gotta be the platform by which, uh, you start.

I think from a, from a blocker perspective, people are time poor, especially lawyers.

We all know this.

And so unless you, um, incentivize and create space for learning, you're probably not gonna have much luck.

The other thing is that we all have muscle memory, and if you don't create a repetitive, um, strategy and, and, uh, reinforcement, then that muscle memory very quickly snaps back to the way that you've always done things.

[laughs]

Yeah, we're all happy that you did.

What this really comes down to, Dave and I sort of had this aha moment a few years ago that you can run a media business a different way than media businesses are currently run.

Media is sort of notorious for low margins and raising at high valuations, getting ahead of their skis and then needing to do big newsroom layoffs or low salaries for journalists or often being nonprofit organizations.

And David and I sort of looked at each other and we were like, but other than software, media is the best business model of all time.

I mean, the operating leverage you can get in a media business is insane.

It takes the same amount of work for us to make an acquired episode for 10,000 people as it does for 10 million.

So if your inputs don't need to scale with your outputs, why wouldn't you make the least amount of content possible and put all your energy behind just finding all the people in the world who... who would be obsessed with that content and then your revenue can scale commensurately with that versus what most media companies do is, hey, we just raised some more money or we just had a good year, let's increase our overhead again and let's try and start from zero in a new vertical or a new beat or something and try to build up a listener base.

Do you think at all about the implications of AI on the industry itself but also on Acquired? Do you feel like there's a disruption coming where AI could do a lot of the legwork that you're doing and people wouldn't need you anymore?

And obviously that event changed Facebook's and Mark Zuckerberg's fortunes hugely.

Yes.

We actually didn't rerecord the episode.

We sort of released it as is with some tongue-in-cheeky comments in there, which we probably wouldn't do today.

Then in 2019...

David came to me again and said, what if it's not about grading transactions? What if we've leaned so much into story in addition to analysis? What if we just tell the story of Tesla as a company without a transaction? It's not about the IPO.

It's just about Tesla.

So we have to do it in one

And what were the incentives that led him to do that relative to everybody else who, and did they have different incentives? Did you think that you understood the answer there?

Uh, his answer was, he kind of took it to how he incentivized people in his organization.

I think the real answer here is Jamie is willing to think with a longer view than his peer set in the 2004, 5, 6 era.

And his thinking was, if I'm trying to build a company that's in a great place 30 years from now, we're going to have to withstand at least one, maybe four or five big drawdowns, wars, terrorism, like let's just bake it all in and assume we need that margin of safety and operate with that.

Whereas everybody else was saying, I hope there's not a recession in the next year and maximizing profit in the short term.

It is

great being here.

I feel like I'm in the center of the universe, I will say, after watching... you know, hundreds of hours of this show.

So how about giving us some pattern recognition about key factors that make these companies successful?

Obviously, David and I think about this a lot.

The biggest thing we've learned is that each of these extreme outliers that we study, these most successful businesses in the world or most successful businesses in any given category, are successful in a unique way.

The founders had some specific skill set that was well tailored to that industry, that product set, that moment in time, and that leadership style.

You knew Steve Jobs.

If you look at Steve Jobs and you compare him against Frank Mars from the Mars M&M Snickers candy company, or you compare against the Dumas family at Hermes, or...

Ingvar Kamprad at IKEA, it's a pretty different set of principles and a different strategy to create these outlier successful companies.

What's the formula

Dyslexia strikes again.

[laughs] It's, it's not the easiest name to remember or pronounce.

But I will say, though, I think if, if your goal is how do I start a trillion-dollar company? How do I start one of the 30, 40, 50 most important, largest, most successful, durable companies on the planet? Founder-led companies have a much higher probability of being that.

And i- as you point out, time has a lot to do with that.

You look at Hermès, this is a, you know, what is it, 150-year-old company? The original founder is not gonna be the person running that.

But close control is a key to the success of that business and so many others, where, uh, th- they control their own destiny.

They don't have to answer to the whims of shareholders.

And then it's just, you know, can you navigate that crisis and emerge on the same or better, you know, to- compounding trajectory that you were before.

That was a good one.

Whenever you're watching football, it kinda looks like somehow the camera is at or near the line of scrimmage.

Well, when it was at the 50, whenever you'd be starting in the red zone, it's really this oblique angle to be watching the play, so they put two more cameras on the 25-yard line so now you're always looking at or near the line of scrimmage head-on.

They've got parabolic microphones.

There's 40 engineers, 20 production people, split screen, interviews.

They are for the first time showing cheerleaders on television-

Oh, really?

... capitalism.