#752: Terry Crews and Richard Koch

This episode is a two-for-one, and that’s because the podcast recently hit its 10-year anniversary and passed one billion downloads. To celebrate, I’ve curated some of the best of the best—some of my favorites—from more than 700 episodes over the last decade. I could not be more excited. The episode features segments from episode #287 "Terry Crews — How to Have, Do, and Be All You Want https://tim.blog/2017/12/20/terry-crews-how-to-have-do-and-be-all-you-want/" and episode #466 "Richard Koch on Mastering the 80/20 Principle, Achieving Unreasonable Success, and the Art of Gambling https://tim.blog/2020/09/22/richard-koch/." Please enjoy! Sponsors: LMNT https://drinklmnt.com/tim electrolyte supplement: https://drinklmnt.com/Tim (free LMNT sample pack with any drink mix purchase) Momentous https://livemomentous.com/tim high-quality supplements: https://livemomentous.com/tim (code TIM for 20% off) Eight Sleep’s Pod 4 Ultra https://eightsleep.com/Tim sleeping solution for dynamic cooling and heating: https://eightsleep.com/tim (save $350 on the Pod 4 Ultra) Timestamps: [00:00] Start [04:48] Notes about this supercombo format. [05:52] Enter Terry Crews. [06:17] Terry's art background and growing up in Flint, Michigan. [15:35] A favorite failure. [22:40] Two ways of confronting an abusive father. [30:41] Terry reflects on his favorite Ralph Waldo Emerson quote. [34:20] How Terry coped with imposter syndrome on his first movie set — with Arnold Schwarzenegger. [39:17] Enter Richard Koch. [39:40] Richard's non-story story about wines, spirits, and chat shows. [41:16] Exception to my "no book quotes" policy for Richard. [42:10] Secrets revealed in Oxford's Bodleian Libraries. [47:32] Richard's peculiar talent and its discovery. [50:17] Richard's investing success despite weak numeracy: the star principle. [59:48] Richard's $1.5 million investment decision. [1:03:41] Business "segmentation" in The Star Principle. [1:06:40] Principles governing Richard's portfolio. [1:09:07] Richard's firing from BCG and meeting Bill Bain. [1:19:03] The growth share matrix (Boston box) explained. [1:22:50] What Bain and Company appreciated about Richard. [1:36:07] Results of early partner-like behavior at Bain. [1:40:00] Key takeaways from Perspectives on Strategy and other recommended books. [1:44:06] Richard's preference for principles over knowledge and The 80/20 Principle's origin. [1:57:58] Richard's happiness and time/energy allocation. [2:01:16] Comparing journaling styles. [2:07:24] Adventurers vs. controllers: who has more fun? [2:10:36] Inspiration for Unreasonable Success and How to Achieve It. [2:17:50] Richard's definition of success and nine landmarks of unreasonably successful people. [2:20:56] Landmark one: self-belief. [2:23:40] Landmark two: Olympian expectations. [2:24:34] Landmark three: transforming experiences. [2:32:52] Landmark four: one breakthrough achievement. [2:35:36] Landmark five: make your own trail. [2:35:50] Landmark six: find and drive your personal vehicle. [2:45:24] Landmark seven: thrive on setbacks. [2:47:54] Landmark eight: acquire unique intuition. [2:48:15] Landmark nine: distort reality. [2:48:56] How landmarks reinforce each other. [2:51:24] Nelson Mandela's unique intuition during imprisonment. [2:58:31] Richard's annual question instead of new year's resolutions. [3:01:44] Parting thoughts. * For show notes and past guests on The Tim Ferriss Show https://tim.blog/podcast, please visit tim.blog/podcast https://tim.blog/podcast/?utm_source=podcast&utm_medium=podcast&utm_campaign=podcast-description. For deals from sponsors of The Tim Ferriss Show https://tim.blog/podcast, please visit tim.blog/podcast-sponsors https://tim.blog/podcast-sponsors Sign up for Tim’s email newsletter (5-Bullet Friday) at tim.blog/friday https://go.tim.blog/5-bullet-friday-1/. For transcripts of episodes, go to tim.blog/transcripts https://tim.blog/transcripts. Discover Tim’s books: tim.blog/books https://tim.blog/books. Follow Tim: Twitter: twitter.com/tferriss https://twitter.com/tferriss Instagram: instagram.com/timferriss https://instagram.com/timferriss/ YouTube: youtube.com/timferriss https://www.youtube.com/timferriss Facebook: facebook.com/timferriss https://www.facebook.com/TimFerriss/ LinkedIn: linkedin.com/in/timferriss http://linkedin.com/in/timferriss Past guests on The Tim Ferriss Show http://tim.blog/podcast include Jerry Seinfeld https://tim.blog/2020/12/08/jerry-seinfeld/, Hugh Jackman https://tim.blog/2020/06/26/hugh-jackman/, Dr. Jane Goodall https://tim.blog/2020/04/16/jane-goodall/, LeBron James https://tim.blog/2018/11/27/lebron-james-mike-mancias/, Kevin Hart https://tim.blog/2020/05/20/kevin-hart/, Doris Kearns Goodwin https://tim.blog/2018/09/07/doris-kearns-goodwin-leadership/, Jamie Foxx https://tim.blog/2015/12/06/jamie-foxx/, Matthew McConaughey https://tim.blog/2020/10/19/matthew-mcconaughey/, Esther Perel https://tim.blog/2017/05/21/esther-perel/, Elizabeth Gilbert https://tim.blog/2020/05/08/elizabeth-gilbert/, Terry Crews https://tim.blog/2017/12/20/terry-crews-how-to-have-do-and-be-all-you-want/, Sia https://tim.blog/2020/08/12/sia/, Yuval Noah Harari https://tim.blog/2020/10/27/yuval-noah-harari/, Malcolm Gladwell https://tim.blog/2016/06/21/malcolm-gladwell/, Madeleine Albright https://tim.blog/2020/05/27/secretary-madeleine-albright/, Cheryl Strayed https://tim.blog/2017/03/30/cheryl-strayed/, Jim Collins https://tim.blog/2019/02/18/jim-collins/, Mary Karr, https://tim.blog/2020/11/11/mary-karr/ Maria Popova https://tim.blog/2014/10/21/brain-pickings/, Sam Harris https://tim.blog/2020/05/15/sam-harris-2/, Michael Phelps https://tim.blog/2021/01/21/michael-phelps-grant-hackett/, Bob Iger https://tim.blog/2020/01/16/bob-iger/, Edward Norton https://tim.blog/2019/10/31/edward-norton-motherless-brooklyn/, Arnold Schwarzenegger https://tim.blog/2015/02/02/arnold-schwarzenegger/, Neil Strauss https://tim.blog/2014/06/24/neil-strauss/, Ken Burns https://tim.blog/2019/09/12/ken-burns/, Maria Sharapova https://tim.blog/2017/08/26/maria-sharapova/, Marc Andreessen https://tim.blog/2016/05/29/marc-andreessen/, Neil Gaiman https://tim.blog/2019/03/28/neil-gaiman/, Neil de Grasse Tyson https://tim.blog/2019/10/03/neil-degrasse-tyson/, Jocko Willink https://tim.blog/2016/09/21/jocko-willink-on-discipline-leadership-and-overcoming-doubt/, Daniel Ek https://tim.blog/2020/12/03/daniel-ek/, Kelly Slater https://tim.blog/2020/09/08/kelly-slater/, Dr. Peter Attia https://tim.blog/2019/11/27/peter-attia-fasting-metformin-longevity/, Seth Godin https://tim.blog/2016/02/10/seth-godin/, Howard Marks https://tim.blog/2018/09/25/howard-marks/, Dr. Brené Brown https://tim.blog/2020/02/06/brene-brown-striving-self-acceptance-saving-marriages/, Eric Schmidt https://tim.blog/2019/04/09/eric-schmidt/, Michael Lewis https://tim.blog/2020/05/01/michael-lewis/, Joe Gebbia https://tim.blog/2018/03/08/joe-gebbia-co-founder-of-airbnb/, Michael Pollan https://tim.blog/2018/05/06/michael-pollan-how-to-change-your-mind/, Dr. Jordan Peterson https://tim.blog/2021/03/01/jordan-peterson/, Vince Vaughn https://tim.blog/2017/05/31/vince-vaughn/, Brian Koppelman https://tim.blog/2020/04/23/brian-koppelman/, Ramit Sethi https://tim.blog/2019/05/07/ramit-sethi/, Dax Shepard https://tim.blog/2020/11/18/dax-shepard/, Tony Robbins https://tim.blog/2014/10/15/money-master-the-game/, Jim Dethmer https://tim.blog/2020/05/18/jim-dethmer/, Dan Harris https://tim.blog/2020/11/19/dan-harris/, Ray Dalio https://tim.blog/2017/09/13/ray-dalio/, Naval Ravikant https://tim.blog/2015/08/18/the-evolutionary-angel-naval-ravikant/, Vitalik Buterin https://tim.blog/2021/03/08/vitalik-buterin-naval-ravikant/, Elizabeth Lesser https://tim.blog/2021/03/16/elizabeth-lesser/, Amanda Palmer https://tim.blog/2019/04/18/amanda-palmer-2/, Katie Haun https://tim.blog/2021/02/18/katie-haun/, Sir Richard Branson https://tim.blog/2017/10/09/richard-branson/, Chuck Palahniuk https://tim.blog/2020/09/02/chuck-palahniuk/, Arianna Huffington https://tim.blog/2017/10/18/arianna-huffington/, Reid Hoffman https://tim.blog/2015/08/31/the-oracle-of-silicon-valley-reid-hoffman-plus-michael-mccullough/, Bill Burr https://tim.blog/2017/09/17/bill-burr/, Whitney Cummings https://tim.blog/2015/06/26/whitney-cummings/, Rick Rubin https://tim.blog/2015/05/15/rick-rubin/, Dr. Vivek Murthy https://tim.blog/2020/03/26/vivek-murthy/, Darren Aronofsky https://tim.blog/2017/09/09/darren-aronofsky/, Margaret Atwood https://tim.blog/2022/02/22/margaret-atwood/, Mark Zuckerberg https://tim.blog/2022/03/24/mark-zuckerberg/, Peter Thiel https://tim.blog/2014/09/09/peter-thiel/, Dr. Gabor Maté https://tim.blog/2018/02/20/gabor-mate/, Anne Lamott https://tim.blog/2021/07/09/anne-lamott/, Sarah Silverman https://tim.blog/2022/01/12/sarah-silverman/, Dr. Andrew Huberman https://tim.blog/2021/07/06/andrew-huberman/, and many more. 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Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Tim Ferriss?

  This episode is brought to you by Momentus. Momentus offers high-quality supplements and products across a broad spectrum of categories, including sports performance, sleep, cognitive health, hormone support, and more. I've been testing their products for months now, and I have a few that I use constantly. One of the things I love about Momentous is that they offer many single ingredient and third-party tested formulations. I'll come back to the latter part of that a little bit later. Personally, I've been using Momentous Mag3, Nitrates, L-theanine, and Apigenin, all of which have helped me to improve the onset quality and duration of my sleep. Now, the Momentous Sleep Pack conveniently delivers single servings of all three of these ingredients.

• 0:42Tim Ferriss?

  I've also been using Momentous Creatine, which doesn't just help for physical performance, but also for cognitive performance. In fact, I've been taking it daily, typically before podcast recording, as there are various studies and reviews and meta-analyses pointing to improvements in short-term memory and performance under stress. So those are some of the products that I've been using very consistently, and to give you an idea, I'm packing right now for an international trip. I tend to be very minimalist, and I'm taking these with me nonetheless. Now, back to the bigger picture. Olympians, Tour de France winners, Tour de France winners, the US military, and more than 175 college and professional sports teams rely on Momentous and their products. Momentus also partners with some of the best minds in human performance to bring world-class

• 1:27Tim Ferriss?

  products to market, including a few you will recognize from this podcast, like Dr. Andrew Huberman and Dr. Kelly Starrett. They also work with Dr. Stacy Sims to assist Momentous in developing products specifically for women. Their products contain high-quality ingredients that are third-party tested, which in this case means informed sport and/or NSF certified, so you can trust that what is on the label is in the bottle and nothing else. And trust me, as someone who knows the sports nutrition and supplement world very well, that is a differentiator that you want in anything that you consume in this entire sector. So, good news. For my non-US listeners, more good news, not to worry. Momentus ships internationally, so you have the same access that I do. So check it out.

• 2:09Tim Ferriss?

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• 2:27Tim Ferriss?

  This episode is brought to you by Eight Sleep. I have been using Eight Sleep Pod cover for years now. Why? Well, by simply adding it to your existing mattress on top like a fitted sheet, you can automatically cool down or warm up each side of your bed. Eight Sleep recently launched their newest generation of the pod, and I'm excited to test it out. Pod 4 Ultra. It cools, it heats, and now it elevates automatically. More on that in a second. First, Pod 4 Ultra can cool down each side of the bed as much as 20 degrees Fahrenheit below room temperature, keeping you and your partner cool even in a heatwave. Or you can switch it up depending on which of you is heat sensitive. I am always more heat sensitive, pulling the sheets off, closing the windows, trying to crank the AC down. This solves all of that.

• 3:11Tim Ferriss?

  Pod 4 Ultra also introduces an adjustable base that fits between your mattress and your bed frame and adds reading and sleeping positions for the best unwinding experience. And for those snore-heavy nights, the pod can detect your snoring and automatically lift your head by a few degrees to improve airflow and stop you or your partner from snoring. Plus, with the Pod 4 Ultra, you can leave your wearables on the nightstand. You won't need them because these types of metrics are integrated into the Pod 4 Ultra itself. They have imperceptible sensors which track your sleep time, sleep phases, and HRV. Their heart rate tracking, as just one example, is at 99% accuracy. So get your best night's sleep. Head to eightsleep.com/tim and use code TIM to get $350 off of the Pod 4 Ultra. That's Eight Sleep, all spelled out.

• 3:56Tim Ferriss?

  eightsleep.com/tim and code TIM, T-I-M, to get $350 off the Pod 4 Ultra. They currently ship to the United States, Canada, the United Kingdom, Europe, and Australia.

• 4:09Speaker 01

  At this altitude, I can run flat out for a half mile before my hands start to shake.

• 4:14Speaker 02

  Can I ask you a personal question?

• 4:16Tim Ferriss?

  No, I would assume appropriate time.

• 4:20Speaker 02

  I'm a cybernetic organism living tissue over metal endoskeleton.

• 4:33Tim Ferriss?

  Hello, boys and girls, ladies and germs. This is Tim Ferriss. Welcome to another episode of The Tim Ferriss Show, where it is my job to sit down with world-class performers from every field imaginable to tease out the habits, routines, favorite books, and so on, that you can apply and test in your own lives. This episode is a two-for-one, and that's because the podcast recently hit its 10th year anniversary, which is insane to think about, and passed 1 billion downloads. To celebrate, I've curated some of the best of the best, some of my favorites from more than 700 episodes over the last decade. I could not be more excited to give you these super combo episodes. And internally, we've been calling these the super combo episodes because my goal is to encourage you to, yes, enjoy the household names,

• 5:18Tim Ferriss?

  the super famous folks, but to also introduce you to lesser-known people I consider stars. These are people who have transformed my life, and I feel like they can do the same for many of you. Perhaps they got lost in a busy news cycle. Perhaps you missed an episode. Just trust me on this one. We went to great pains to put these pairings together. And for the bios of all guests, you can find that and more at tim.blog/combo. And now, without further ado, please enjoy, and thank you for listening.

• 5:52Speaker 01

  First up, Terry Crews, former NFL player, American film and television star of The Expendables, Everybody Hates Chris, and Brooklyn Nine-Nine, host of America's Got Talent, and bestselling author of six books, including his memoir, Tough: My Journey to True Power. You can find Terry on Twitter and Instagram, @terrycrues.

• 6:17Tim Ferriss?

  I thought we'd start somewhere that perhaps... People wouldn't associate you with, if that's even English, but you guys get my drift. And that is art. So I went on to your Instagram profile not too long ago and I saw a number of different profiles. And then I started digging and I didn't want to tease out too much because I want to talk about it. Can you tell us a little bit about your background with art?

• 6:44Terry Crews?

  You gotta know, I mean, growing up in Flint, there were a number of obstacles. I mean, crazy, crazy obstacles because I grew up at the height of the crack epidemic and also the demise of the auto industry. So there were two things happening at once and they were both horribly bad. I mean, it was like the eighties, probably late seventies, all the way through the eighties into the nineties, was literally the walking dead. And it was real. I mean, you had people who were cracked out. I had friends, family who one day, you know, were good people, the next day, they were stealing

• 7:25Terry Crews?

  everything you had. All the way to everyone you knew were losing their jobs and it was a panic. And I remember, there was two ways out. And one was through music and performing. Another way was athletics. But art, you couldn't get paid doing art. You know what I mean? It was kind of, everybody was like, that's a wonderful picture, but it's, you're a starving artist. That's the whole term, you know? And I remember just saying, okay, I'm gonna do this art thing, but I had to do the football thing too. And these were my ways out. Now, I didn't believe that I was actually going to get any kind of light as an artist, but I had one teacher, one man, Mr. Eichelberg. I'll

• 8:10Terry Crews?

  never forget this. He said, Terry, you are an amazing artist. He was like, I'm the art teacher, you're better than me. And he said, you can go somewhere with this. And I was like, okay, but, you know, you know, nobody's gonna pay me to do this. Nobody, it's good, but I gotta use football. Well, he filled out all the applications for me.

• 8:32Terry Crews?

  And I didn't even know. Wow. This is crazy. And he took my pictures and my paintings and everything that I did, he took and got them photographed, did all this stuff, sent them to Interlochen Arts Academy. Now, Interlochen is this world famous. Big deal. Big, big deal arts camp up in northern Michigan, near Traverse City. And you study with people from all over the world. And he literally came to me and told me, he already filled out everything and he said, Terry, you have a scholarship from Chrysler Full Ride to go to Interlochen Arts Academy. And I was like, what are you talking about? Like, you know, first of all, I didn't think it was possible. This is the deal.

• 9:17Terry Crews?

  There's a lot of things, it's weird because you gotta let people believe in you, but I didn't believe in myself. And when I got a chance to go to Interlochen and study with people from Europe and from Brazil and from, and these was mainly music students and then they had art students and it was just this, and coming from Flint, I mean, coming from the hood. And then this changed my life. Once I, I remember we had, and it was really big on competition, very, very big on competition. It was like, if you were a violinist, you had to be the first chair and second chair. And I remember all these kids were disappointed because they kept moving down and they would just feel like they were crushed. And the same thing with art.

• 10:02Terry Crews?

  We had to do two drawings and we had the whole class doing all these drawings. And they said, put your drawings on the, on the wall and don't put your name on them. We have this guy coming from the Cleveland Institute of Art. He's gonna judge each painting and we wanna see who's the best. And I was like, oh, man, you know, and so I did my deal and I put all, it was a wall full of art. The art guy pointed at mine and he said, that one's the best one. Then he went all the way across the room and he said, that one. And they were both mine.

• 10:35Terry Crews?

  And I was like.

• 10:39Terry Crews?

  Now, life is a confidence game. Cause then you couldn't tell me nothing. I was like, damn it, I'm good, you know? I got too arrogant, then I got arrogant. I'm the best one here, you know? And then you have to be humble some other way, you know? But that letting me know, I was like, wow, I can, I can do it. I can do it. Like, I'm really as good. These people, this is all over the world. And then I got a scholarship to Western Michigan University in art. But it was small, it wasn't a full ride, but it was a small deal. So I got an art scholarship and walked on to the football team.

• 11:22Terry Crews?

  And my mom passed away about, almost three years ago. And she always would tell me, she was like, whatever you do, I know you doing all this football stuff, you're doing all this other thing, but never forget, you're an artist, babe. You're an artist.

• 11:42Terry Crews?

  I'm telling you. When I see what I'm doing right now. And I get to do so many things that so many people never got to see. I get to go so many places and do so many things that none of the people who wanted to were able to. I feel like there is a responsibility, but also if I don't do it, everything they've gone through is nothing. You know, so the way I approached things is really, it's kind of for everyone else. You know, I have to try it. I have to go for it.

• 12:24Terry Crews?

  And I knew, even as I was doing football and I was doing all this stuff. I remember once, because football was hard. Football was a very, very, again, another competitive deal. You know, you would get on the team and I would get cut. I was like, I have to depend on this art thing because this is what got me here. And so I would go back in the locker room. And this is how, I was married, I had two kids at the time. I would go back in the locker room and go to the players and I would ask them if they wanted their portraits painted. And the weird thing is, they were like, oh man, come on, man, you can't do it. And I was showing my portfolio and they were like, damn dude.

• 13:06Terry Crews?

  Ah, and I was like, look, man, I want to paint you over this big, I'm gonna put you and you're gonna be a giant over the city. And I can have wing, you can have wings and you can do. And let me tell you, you know, football players are the most egotistical people in the world. They were like, oh damn, yeah, man, I want the wings, dog. How, how much for them wings, man? You know, and I was like, oh yeah. And I would do these masterpieces. But you know, I have to tell you this too, I did have a scam. I had a scam. This is a scam in college. In college, I would, because what happened is I was playing football, but when you play football, you don't get money for supplies. You only get book loans. See, scholarship is a gift.

• 13:48Terry Crews?

  All you got, I'm telling you, the NCAA is a gift, dude, the whole deal. You are not a student athlete. You are semi-pro. That's all it is. There's no student in it, just putting it right now. And what was crazy is that I was like, hey, but I want to study art. They were like, uh, why don't you just study business or something? So it's easier to get by, because the whole thing is just getting by. Take a class so you can go to football practice. But I was like, I'm an artist. And they were like, okay, whatever. So I would go to these labs and I would make, and this is what I had a plan. In the summer, I would make like probably 10 paintings. And then I would make four of them really suck, like they would be really, really bad. And I would bring those in in the beginning and these were these labs and I would go to the teachers.

• 14:30Terry Crews?

  I was like, man, you know, what's wrong with this? Like, help me out here. You know, he was like, oh Terry, oh my God, look. Okay, we're gonna work on your perspective and we're gonna do this. And I was like, yeah, no, help me. And then I'd go home and then I'd go to practice for like a month and never do anything else because I had the paintings done. Then I, I'd bring another one in that was a little bit better.

• 14:55Terry Crews?

  And let me tell you, I did this the whole semester and then I would bring out the masterpieces. And I was, he had I laid and I say, look how much you helped me.

• 15:08Terry Crews?

  You took me from here to there, sir. And they were like, you were getting, hey, you were awesome. And I, that's how, and I, again, the whole thing was a scam. But I had to survive. I had to find a way to stay in school. Cause this is the thing a lot of people don't know is that they could take your scholarship. It was crazy. It was one of those things where you're there as a body. And if you don't perform, they'll find a way to get rid of you.

• 15:35Tim Ferriss?

  When I was looking at your history and your book and your backstory, one thing that I paid attention to as a pattern was an uncommon degree of self-reflection. And so I want to rewind the clock a little bit back to high school. One of the stories that you put in Tribe of Mentors is related to my question related to favorite failures or a failure that set you up for later success. Could you tell us a little bit about that, please?

• 16:03Terry Crews?

  Oh, man, yes. 1986, that was my senior year in high school. And I went to Flynn Academy and it was a classy school, but we were highly ranked in the state. And I was, I used to be a basketball player. I mean, that was, you know, hard to believe now, but basketball was a big sport for me, but I was the starting center on this team. And what was wild is we were picked to go all the way in the state. We had a superstar on our team and we had a really, really good team. We played against this school who decided not to play. It was the district championship. It was right at the beginning of the playoffs and these guys would take the ball down the court

• 16:47Terry Crews?

  and pass the ball to each other at top of the court and wouldn't play. And we had a coach who was like, well, you know what? I'm gonna beat you at your own game. So we stayed in the zone. So we sitting there the whole time and I'm telling you, it was the most boring game of all time. We just sat there with our hands up and they passed the ball. And if anything happened, somebody you went and got it and it was, you scored two and it was just a mess. So the score was really, really low. They were up forty-seven to forty-five and it was literally under a minute. And I'm freaking out because now we're going to, it's evident we're going to lose. Cause I'm going, man, this is a dumb defensive strategy anyway. We should have been going after it.

• 17:33Terry Crews?

  But what happened is a guy threw the ball, their guy threw the ball cross-court. I intercepted it. And with literally five seconds left to go. And I take the ball all the way down the court. You gotta understand, I'm thinking, I had visions of, oh my God, this is the thing. I'm the hero, you know? The heart is, it's like pounding, you just, I'm already at the party. You know what I mean? And I go with this layup and I bring it up there and it totally, it gets around the rim and it rolls off.

• 18:12Terry Crews?

  And let me tell you, that place goes nuts because it was the upset of the year. And I collapsed in a heap and I know my life is over. And you gotta understand, and this is another thing, shame among men. It's like, oh, how could you do that, man? Your other players were yelling at me, the coach. I was in the locker room. He was like, you had no business taking that shot. And I stole the ball. It wasn't like, like we didn't have a shot anyway. But he was like, you have no business taking that shot. You should have passed it. Man, it's your fault. And everybody in the room was like, yep. And I was like, they didn't let me off one, and I remember just going, oh my god.

• 18:57Terry Crews?

  And I went in the paper, and the paper the next day was like, Terry Crews had a shot and he missed. You know? And let me tell you, it was the most dark, I mean, when you're 16 years old. I was, I mean, beyond crushed. I, one guy was taunting me, I got in a fight after the school and the whole thing. And I was just like, this is awful, it's horrible. And so, it was a couple of days went by and I was in the deepest funk. I'm sitting on my bed, and I shared my room with my brother. But, for some reason, he wasn't there. Because I, I always remember him being there, it was kind of great. I don't ever remember being alone, except that time. And I remember being alone, and just thinking about, man, I should have passed it.

• 19:43Terry Crews?

  I should have passed it, maybe I messed up and, you know, what else could I have done? And then another little voice, it said, "I took the shot. I took the shot." And I was like, "I did, I did." And it was kept, and I kept thinking, it was like, man, look, when you had the chance, when everything was on the line, you took your shot, man. You did that, you did that. And all of a sudden, I was like, that's right, that's right, I took it. And I learned from then on, I said, man, wait a minute, if I win or if I fail,

• 20:28Terry Crews?

  it's going to be on my terms, it's going to be up to me. I, if I have the opportunity, I have to go for it.

• 20:39Terry Crews?

  And then I felt really good about losing the game. It was real, it was totally, now, this, you can call it reframing. A lot of people have scientific ways or psychological ways, you know, to do things. But I learned always to kind of reframe things so that it's to your advantage. You know what I mean? And you look at these things like, wait a minute, you took the shot, man. And this is another thing, because what's so crazy is that no one ever remembers that game. It's one of the least important things in my life. But the lesson I learned is still guiding me today. The fact that go for it. Take your shot.

• 21:24Terry Crews?

  Take your time. When you get that thing, when you have that opportunity, don't mess it up. Because this is another thing, and I want to tell you, Tim. The scariest thought ever is one thing that blew me away is that you really do get what you want. And let me tell you what I mean. There have been times when you can be self-destructive. And you think it's something else, or you think, like, I discovered for a long time, like, if I show up late or something twice, I don't want it. And you get what you desire. Everything about you, you get what you want.

• 22:06Terry Crews?

  Now, the way your life is, truthfully, you want it. And now, that's hard. That's hard to say, because a lot of people are like, no, wait, there's so many other options. It's this, and this, and this, and this. But the truth is, is that if you wanted something different, you change it. And that hit me, like, it's scary. Because if I failed, or if I didn't, if I showed up wrong, or messed up on something, I was like, I didn't really do what it took to get it. Again, that comes from taking that shot way back in high school.

• 22:40Tim Ferriss?

  So, one of the things I really appreciate about you, and that led me to want to reach out to you, is how forthcoming you've been about your difficulties and some of the challenges you've faced. Because I think a lot of folks we see on magazine covers and so on, unfortunately, give people the impression that they're flawless, they have it all figured out, and then people feel uniquely flawed in some way. That they're damaged because they're not that person. That's unachievable. Could you share with us a story of any dark period in your life and how you found your way out of it? Things that helped you to navigate your way out of it?

• 23:20Terry Crews?

  There's a lot of dark, dark times. You know what? I'm gonna share this story, which changed my life. I was, literally just got my first job in entertainment. I was on a TV show called Battle Dome, where they, they literally put me in a cage and I fought my way out.

• 23:38Terry Crews?

  It was so entertaining, but, you know. It was pre-MMA, you know what I mean? So people hadn't seen blood on TV yet. You know, we were like the first. It was really nuts. People were bleeding, going to the hospital. It was called Real Warriors, Real Pain. And I played this character called T-Money. And that's actually my wife's pet name for me now. She's like, "Hey, T-Money."

• 23:58Terry Crews?

  And we called this the Christmas from Hell. Because here I wanted to come home. I went home to Flint, Michigan with my family. Now, you gotta understand, my kids, at the time I had three. I have five total now, but I had three kids at the time. And the girls were, and they were all girls. They were very small. They had never grown up with violence in the house. Okay? They'd never seen it. And so I told my father before I came, I said, "Hey, man, don't act up. Do not act up." And he said, "I ain't gonna do nothing." You know, and I'm like, "Okay." So I'm bringing on the family. I know it's Christmas time, so just relax, man. And we're gonna be there, it'll be fine.

• 24:42Terry Crews?

  So we get there, we're having, we're having a good time. My wife and I are going out. We actually are driving to Detroit to hang with friends. And I get this call. And it was panic. My aunt called me, he said, "Terry, your daddy hit your mother.

• 24:59Terry Crews?

  In front of the kids, he got mad. He knocked her tooth sideways."

• 25:06Terry Crews?

  And I go, "I told him, I told him."

• 25:11Terry Crews?

  Now, literally, I stopped the car. We're turning around. I told my wife, "Okay, we're gonna go over my ass. So you take the kids, go to her ass house, the whole thing. I'm done. I'm dealing with this." First of all, I went in this house. He was, had the nerve to still be there. And I said, "Dude, what are you doing?" He was like, "Shut up, leave me alone. I can do what the hell I want." Boom! Let me tell you something. I beat this guy for about an hour. He was pleading for his life.

• 25:48Terry Crews?

  I was like, I'm not a child anymore. I am a grown ass man. And how does it feel? You are about to get what my mother has felt.

• 26:02Terry Crews?

  And I laid it on him. He was hurt, bleeding, laid out. I'm surprised I didn't kill him. And I felt not one ounce better.

• 26:16Terry Crews?

  I remember falling on the ground, crying in tears. It didn't make me feel one bit better, not one. Like, now, I was just down there with him. This is the revenge I've dreamed about my whole life. And now, nothing? Now, I'm just like you?

• 26:38Terry Crews?

  And I remember just feeling empty, cold. It's probably the darkest place I've ever been because this here's the man who's the reason I'm here.

• 26:50Terry Crews?

  And I put him in his place, so to speak. And I'll never forget. It was just the most hollow, hollow feeling I've ever had. We got out of there. It took me years to overcome that. Like, we got out of there. I got the kids out. We never came back. I mean, we literally like, forget the holidays. We're not doing this. But after years of therapy, and this is, this was literally about about six or seven years ago. What I'm talking about happened like 99, okay? So, I go back. And I go back to my father. And I've been listening to things and trying to do this thing correctly. And I remember, I just said, I have to find one thing

• 27:36Terry Crews?

  that I can tell him that he did good. And I said, and we called him Big Terry, because his name is Terry too. So I said, Big Terry, man.

• 27:48Terry Crews?

  I wanna thank you because if it wasn't, it wasn't for you, I wouldn't be here. And if I had to choose my parents, I'd choose you. Because the truth is, he's the reason I'm here. If it was another person, I'd be another person. So I said, if I had to choose my parents, I'd choose you. And let me tell you something. He, he just broke down. He said, Terry, I'm sorry. I'm sorry for beating your mom. I'm sorry for everything I did. Uh, uh, listen, man. Those words broke him down. He cried in my arms

• 28:33Terry Crews?

  for about the same time as I was beating him years earlier. And I was like, this is not hollow. This feels good. This is healing. And I said, man, I have to use my strength for good. Because everybody can knock somebody out, but to give a hug with muscles is a whole nother matter. And I said, that is how, that's the vulnerability. That's the authenticity. That's where real healing takes place. Because shame wants punishment.

• 29:18Terry Crews?

  It just wants to get back. Boom, boom. And it's temporary. But guilt develops discipline. When you admit I was wrong. Because shame is when secrets and you don't say anything. But guilt says, I did it. I'm sorry. And then you develop discipline to change. Man, again, it was one of the darkest periods in my life, but totally reversed. And I decided, that's gonna be my life. This is who I am. Now, some people got their ass whipped. But I'm trying to tell you in between it now. Because I'm trying to tell you, one thing is, some people try to take that and be like, ah, I can punish you. I'm like, yeah, get out of the way.

• 30:03Terry Crews?

  But, but.

• 30:07Terry Crews?

  What I want to say is that the big thing was is that I knew that would never be. The only way I would ever use that is to protect. Is to protect, not to get back, not for revenge. There's a time, but I'm telling you, man, that was a period that I learned forever. Now, again, my father, I wish I could say he changed. He kind of went back to his old ways, but I'm here.

• 30:38Terry Crews?

  And I did the things I needed to do.

• 30:42Tim Ferriss?

  I'm gonna ask one more question, and it's related to a question that I posed to you in the book. Because whether it's looking at some of your early decisions as a child, or the toughness that you showed in athletics, or doing what other people might consider risky by trying to create your own category in many different worlds, or having that second conversation with your dad. I think there's a quote that really exemplifies you, and it's actually a quote that you gave me in the book. And it was in answering the question, if you could have a giant billboard anywhere with anything on it, what would it say and why? And it begins with, "God will not." Could you give us that quote, please, and explain its importance?

• 31:27Terry Crews?

  Oh, man. "God will not have His word made manifest by cowards." Ralph Waldo Emerson. It's my favorite quote. I literally have it in my dressing room, put on the wall in giant letters, because fear begets more fear, but courage just begets more courage. And like, you don't even get to be born unless your mother has the courage to have you.

• 32:02Terry Crews?

  Any great thing, any, just from literally creating a business to making art, it takes this courage. It takes this willingness to be looked at, to be judged. You have to face down your fears, and you have to step outside and go. And it helped me to just lay out what I was afraid of. Because that's the big thing, you know? You have to ask yourself, what are you scared of? And then you have to attack. You have to literally have to lay out. I remember, now you tell about your swimming experience. I was always, you know, you know, when you grow up in the ghetto, they kick you into the pool.

• 32:46Terry Crews?

  And these are not good experiences, okay? And so, you know, we didn't grow up on an ice pool and the beach and the whole thing. It was like the hood and it's like, oh, man, it's not good. So my first experience was horrifying. I almost drowned. And so then one of my fears was swimming. And I remember when I had a house with a pool. And I remember going in the backyard and just diving into the deep end over and over again. To get rid of the fear. And it's weird because you get near the edge and you go, oh, man, here I am. But I have to beat it. And so I would just jump in and just keep jumping in and keep jumping in. Until you're not afraid anymore. Because remember, it's a confidence game.

• 33:30Terry Crews?

  And that quote, just when you think about anything that's made and anything that's created, anything that you see that you admire, takes so much courage. Because people are going to judge it. And people are going to say, ah, that sucks. You know, especially in the age of the internet, who are we? You know, everybody's coming in and chipping in with whatever they have to say. And you have to be willing and you have to be vulnerable. This is why vulnerability is actually strength. Because the vulnerability is part of courage. You have to be willing to let people judge your stuff. Willing to let people hear your song. Willing to let people hear you sing.

• 34:15Terry Crews?

  And it's so wild because I'll never forget, I always got a story for that. It's that the first time I ever got a movie. It was a big movie. It was with Arnold Schwarzenegger. It was called The Sixth Day. And I'll never forget, I'm like, I thought it was gonna be like a quick role. It turned out to be a big job that worked six months in Vancouver. And I'm like, oh, my God. And the first day I was on set, I had to say this line, Adam Gibson, come with us. You know, please come with us. And I remember they said, action. And I walked up on Arnold and I was like, Adam Gibson, we need you to come with us. And he turned and looked at me and I was like, ah.

• 34:57Terry Crews?

  And wait, and I mean lightning fast. Everything went through my head like, you don't deserve to be here. You're just a dumb football player. You are a farce. These people are gonna figure you out. You are fake. You're a phony. You fooled everybody. It's a rap. They're gonna find out and they're gonna kick you out of here. And that's lightning fast. And then something was wrong with the camera. They were like, oh, you know what? We got a problem with the lights and we gotta, give us five minutes. And this was all split second. And I remember, cause I bros, and I know I bros. And I remembered, I just went to the side and I was like, Terry, you survived the NFL.

• 35:41Terry Crews?

  Do you wanna, and after I left the NFL, I was sweeping floors. I was doing security. And then I went to acting. And I said, do you wanna go back to sweeping floors? Do you wanna go back to security? I said, man, go in there and say these lines, man. And I literally was cussing myself out. It was like, yo, get some guts, dude. And I walked back in there and they were like, actually, I was like, Adam Gibson, you know?

• 36:05Terry Crews?

  And wait, and Arnold was like, this guy, I like his energy. He's got a lot of, it's amazing. I like him, it's really, and let me tell you, after that, I learned, go in. Rush in. Rush in. And there's never been a time, I've been acting for fricking, almost 20 years and there's never been a time those, and this, and that's why I wanna demystify this thing. I've never been a time that I don't have those bubbles right before action. Never. Ever. It's always there. Don't let anybody trick you and act like, oh, man, I'm good, nah, nah. If, if, if they that good, they don't care. I'm trying to tell you, if you care, you're gonna always be nervous. You're gonna always have to face it. But when you walk in, it turns into a mirage.

• 36:50Terry Crews?

  And it just starts to disappear. I remember on a set of white chicks. It disappeared. I remember I was rolling and I remember, Keenan and I were wearing, I was like, you got any notes, Keenan? He was like, man, do what you do, man. And I remember just flowing and everything, you know, people who know and not a lot of people here who understand it. If you've ever been in the flow, it's amazing. Like there's a time when all the light, the writing just comes, the lines just come, the job is smooth. You're like, man, I could do this all day. That's by practicing, facing that fear, fear, fear, just going in, going in, going in till you hit that zone. Man, it's a high like you will never, ever, ever experience.

• 37:32Terry Crews?

  I encourage everyone and I'm not here, I'm here to be demystify it. You will be nervous, always, but go anyway. It's beautiful. Terry Kruse.

• 37:43Tim Ferriss?

  All right.

• 37:52Tim Ferriss?

  Just a quick thanks to one of our sponsors and we'll be right back to the show. This episode is brought to you by Element, spelled L-M-N-T. What on earth is Element? It is a delicious, sugar-free electrolyte drink mix. Element is formulated to help anyone with their electrolyte needs and perfectly suited to folks following a keto, low carb, or paleo diet. So if you're on a low carb diet or fasting, electrolytes play a key role in relieving hunger, cramps, headaches, tiredness, and dizziness. Sugar, artificial ingredients, coloring, all that's garbage, unneeded. There's none of that in Element. And a lot of names you might recognize are already using Element. It was recommended to me by one of my favorite athlete friends, three Navy SEAL teams as

• 38:33Tim Ferriss?

  prescribed by their Master Chief, Marine units, FBI sniper teams, at least five NFL teams who have subscriptions. They are the exclusive hydration partner to Team USA Weightlifting and on and on. Get your free Element sample pack with any drink mix purchase at drinkelement.com/tim. That's drinkelement.com/tim. And if you're an Element insider, one of their most loyal customers, you have first access to Element sparkling, a bold 16 ounce can of sparkling electrolyte water. Again, check it all out, drinkelement.com/tim. Drink L-M-N-T.com/tim.

• 39:17Speaker 01

  And now, Richard Koch, renowned investor and bestselling author of books on business and personal success, including The 80/20 Principle and his most recent book, Unreasonable Success and How to Achieve It. You can find Richard on Twitter @RichardKoch8020.

• 39:40Tim Ferriss?

  Richard, welcome to the show. I'm so thrilled to have you. It is, in some respects, decades overdue, and we were just chatting before clicking record. Could you please get us started with wines and spirits?

• 39:53Richard Koch?

  It's a great pleasure to be talking to you, Tim. Thank you very much for all your generosity in giving me quotes to put on books and things like that. That's very much appreciated. I'm not sure that this is a great place to start, but I was just thinking that you had reinvented the talk show. And when I was 17 and I had the first job in Windsor, England, as a van driver for a firm of wines and spirit merchants, they were called Lovey Bonds, and they were probably about the most old fashioned wine and spirit retailer you could possibly imagine. And one of the things which they did was deliver wine and spirits to quite a distinguished bunch of people, actually. I used to drive

• 40:37Richard Koch?

  into Windsor Castle and give the Brigadier his gin and so on and so forth. But one of the other people that I used to visit was Michael Parkinson. And Michael Parkinson, as you know, was a very successful sports writer and broadcaster who then branched out into doing chat shows. And some of the stuff which he did was marvelous. I saw a clip the other day of him talking to David Bowie, and it was fantastic. They were really enjoying themselves and they were moving very smartly from point to point. And that made me think about you, because I think you reinvented the chat show on podcasts, and it's just amazing. So anyway, that's my non-story to start with.

• 41:16Tim Ferriss?

  Well, give me time to disappoint, and I appreciate the kind words. And I should also say for people listening, those people who perhaps have read the various policies on my website will note or received one in my auto-response via email will know that I say I don't give quotes for books, I don't do forwards, I don't do, and I have a very long list of do not do's. The reason that I've made an exception is that, and if anyone else fits this bill, feel free to reach out, because I know it's going to be approximately zero. If you've written a book, like several of your books, that have traveled with me for more than 10 years from place to place, that sit on my shelves face out as a reminder,

• 42:01Tim Ferriss?

  feel free to reach out, but that is going to be a very small number indeed. And perhaps we could start, this isn't exactly the beginning, so to speak, but with the Bodleian Library. And if you could explain what that is and take us into context from there, I think that would be helpful.

• 42:20Richard Koch?

  The Bodleian Library is a fantastically beautiful building in Oxford, very close to the college that I was at. And I used to sit in there, in the stacks, and look out of the window whenever I could. But the great thing about it was that it had almost any book that you could possibly imagine. And one day, I decided that I wanted to read a book, which I had read about, called The Course of Economic Theory, but it was in French, written by our old friend Vilfredo Pareto. And it was published in Lausanne in, I think, 1896 and 97. And I have no idea at all, Tim, why I wanted to read this book, because it wasn't part

• 43:03Richard Koch?

  of my coursework or anything like that. But that was a book in which I discovered the 80-20 Principle. And he didn't call it the 80-20 Principle, as you know, but nevertheless, he had all these algebraic equations, which showed the wealth distribution in England in the 17th century, 18th century, 19th century, and also in Italy, France, Switzerland, other countries over those periods of time. And what he found was that there was the same pattern of distribution. Of wealth against the population. And a remarkably similar chart could be drawn from the algebra for any of those countries

• 43:44Richard Koch?

  or any time in order to show what proportion of wealth was owned. And of course, it was a very small number of people or proportion of people who actually owned most of the wealth or earned most of the money. So you might say, well, that's very arcane and it's not particularly interesting. But I instantly thought, I can use this, I can use this to cheat in my examinations without actually cheating. And so what I did was to say, well, I do know that I'm going to have to write 11 papers, three hours long each, at the end of my time in Oxford. The Oxford degree is entirely determined by the final examinations.

• 44:28Richard Koch?

  There's no assessment current or there are no previous examinations at all. So it's a very, very important thing. But I had noted that on sample papers, there were something like 50 questions or whatever. And it's impossible to imagine that I could actually research or do work on 50 questions times 11. So I thought, well, maybe if this 80 20 principle applies, there will be some questions which are asked much more frequently. And lo and behold, I got the papers for the history exams for the last 20 years. And it was absolutely true. There was always a question about the French Revolution. There was usually a question about the Russian Revolution.

• 45:11Richard Koch?

  There was always a question about the origins, the causes of the First World War and so on and so forth. So I said to myself, well, you know, I don't need to study very extensively. You could write the answers to three or four questions. It was your choice during three hours. So what I said was, I will research six subjects. No more for each paper. And I will be word perfect. I will have very obscure quotes. I will use foreign languages that I don't actually understand.

• 45:45Richard Koch?

  Absolutely word perfect. And if I do that, I don't have to do much work and I will get a top degree. And lo and behold, that is exactly what happened. And then I thought to myself afterwards, gosh, this man Pareto was quite on to something, wasn't he? So that was my introduction to the age of 20 principle. Perhaps I'll never look back in some senses.

• 46:06Tim Ferriss?

  You know what is, well, to me, so funny about that in part is that I did something very similar. I just was not aware of Pareto at this point. But when I was doing my undergrad, I about halfway through began asking teachers to give them some degree of sort of plausible deniability because I was hesitant to ask outright what is going to be on the exam because they're not supposed to answer such a question. But I would ask teachers, or I would say rather, I know I need to study everything that we've covered for the exam, but if there are any particular areas you think I should focus on, would you mind telling me? And they were very forthcoming. So it ended up having a very similar effect, although I definitely was pleased

• 46:51Tim Ferriss?

  that in most cases, not everything hinged on final exams. I think I probably would have been crushed under the sort of psychological intimidation of that type of sink or swim setup.

• 47:02Richard Koch?

  Yeah, I was quite nervous in my sense, but I had, I found a solution to that, at least in the afternoons, was that after the morning paper, I would go down the pub and have a couple of pints of beer. And I found that calmed my nerves. And it was notable that I got better results in the afternoon than I did in the morning.

• 47:24Tim Ferriss?

  Well, that could be in one of your, one of your next books if you have uncovered academic hygiene and preparation. If we're looking at formative periods, let's just say, high school, college, university, however you want to label it, I'm looking at notes, as I do, in these types of conversations from an interview you did with Boing Boing a long time ago, an outlet that I know very well. And one of the questions posed was, what advice would you give to a smart kid who's now in high school? And you can feel free to fact check this and correct, but the answer, I'm just going to read briefly, and then I have a follow up. Discover what you're best at doing and enjoy that is different from what all of your peers are doing and that requires relatively little effort from you.

• 48:09Tim Ferriss?

  Then put huge effort into honing that skill so that it becomes monstrously greater than anyone else's. Keep demanding that each year you make your peculiar talent more peculiar and much more potent. Use this skill to make the world a more interesting place. Don't care about making money. If you have a fantastically different and useful skill, everything else you want will follow. So I have two questions. Accurate or not accurate, quote, secondly, what is your peculiar talent and how did you discover it?

• 48:37Richard Koch?

  Well, it's totally accurate and it's very easy to give advice and perhaps less easy to originate the advice, or at least to exemplify the advice. I was always very, very interested in history because it enabled me to develop a certain skill in analysis with non-quantitative analysis. I'm absolutely hopeless at numbers. But in terms of understanding structures, in terms of understanding trends, in terms of really getting to grips with what might have happened that other people had not noticed, then that's what I did. And, you know, I came up with some pretty wacky ideas during my time studying history, but I thought that they were plausible and the examiners must have thought so too.

• 49:21Richard Koch?

  I mean, for example, it seemed to me that Hitler had been copied pretty much what Lenin and Stalin had done. So of course Hitler was a great anti-communist and they were great anti-Nazis, but he actually had followed Lenin's policy, for example, of a one-party state, which no one before Lenin had really done, and of death camps for dissidents and enemies of the regime.

• 49:46Richard Koch?

  Again, no one had really done that, certainly not on such a ruthless scale as Lenin and later Stalin did. So it was my theory that Hitler had based his policy on the Bolsheviks. And that's just a little example. I'm not absolutely sure that's true, but it's plausible. And it's sort of trying to Winkle out things that might be true, which are interesting and important, but which no one else has spotted. That's what I try and do. That's what I enjoy doing.

• 50:16Tim Ferriss?

  So you mentioned hopeless with numbers now, or maybe I injected the hopeless, but you were very self-deprecating with respect to numbers and numeracy. And yet, people would look at your track record of investing as an example and ask, how can that possibly be the case? So again, in my notes, I have Betfair here, which I would love for you to explain, but it adds that you couldn't use their website. Now, please explain.

• 50:49Richard Koch?

  Okay, well, the way of reconciling those two apparently different things, I do have a very good track record, thank God. I've been very lucky or very fortunate, at least in my investments, but it's not based on being an analyst in the conventional sense. I got fired from the Boston Consulting Group because I was no good at doing financial and market analysis, despite the fact that I was quite good at doing some other things which they didn't value very much. It is true that I'm not particularly numerate, but I believe that's a skill which is readily available from other people. And as far as Betfair is concerned, I based my investment, as indeed all my investments are based, on the STAR principle,

• 51:33Richard Koch?

  which was something that the Boston Consulting Group themselves had invented way back in the 1960s. And this is the old chart of the dogs, stars, question marks, and cash cows. So I never make an investment unless the business is a STAR business or has the potential to be a STAR business. And BCG's definition, my definition of a STAR business, is that market leader in a niche, a defensible niche, where you can protect it against other people, other competitors, and a high market growth rate. BCG said more than 10%. I've really tried to aim at more than 30%.

• 52:10Richard Koch?

  And the thing about Betfair was that a friend of mine in 2001 came along and said, "We've started this betting company," and I'm a gambler, I like gambling, "and we think it's completely different from anything else because it's not a bookmaker." And I said, "Well, what do you mean?" And he said, "Well, a bookmaker is someone who makes a book and basically offers odds to punters, gamblers who might want to bet on it." But Betfair doesn't do that. What it does is it started an electronic market, which enables people to either act as a bookmaker or to act as a punter.

• 52:52Richard Koch?

  So you can go on to the site and you can see posted up there the odds other people will give. And the odds for the punters are vastly better because there's no bookmakers' profit. Now, I said, "No, it can't be true because Betfair has to make some money. How do they make money? What's their business model?" He said, "Well, they have a very small commission, which they take, and they only take that on winning bets." So I said, "Well, that sounds like a fantastic idea. So what's the problem?" And he said, "Well, do you want the real truth?" And so I said, "Yeah, of course I want, Anthony. Of course I want the real truth. What's the problem?" And he said, "Well, no venture capitalist, no professional financial firm would invest in this company."

• 53:35Richard Koch?

  When they first had their round, they started about six months previous to this. And he said, "And there was, from their point of view, a very good reason for that, which was none of the managers in the business had any experience." I said, "Oh, you mean they didn't have experience in the industry?" He said, "No, no, they don't have experience in the industry. Well, one of them used to be a professional gambler, but that's not experience which venture capitalists would recognise as being hackable." He said, no, they never run anything. And I said to me, so Anthony, you're telling me that I should put money into a business that has people running it, they've never run anything else.

• 54:15Richard Koch?

  He said, well, one of them used to be a financial debt person at Morgan Stanley. And he was making, you know, he was trading loans and doing that sort of stuff. And he said, you know, trading loans is not a million miles away from running a betting exchange. But the truth was that they really were all sports enthusiasts, all gambling enthusiasts. And none of them had had any experience of management, which explained why it was only friends and family who'd been able to invest in, or been willing to invest in this particular company. So I said to Anthony, well, what's the attraction? He said, it's a star business, Richard. And Anthony had worked for me in L E K and also in a company we set up after L E K called Strategy Ventures.

• 54:58Richard Koch?

  And so he knew that I knew that the way to make money in investing in small businesses was to actually invest in something which could be or was a star business. Well, even though it was tiny and even though it was losing money, it was clear that Betfair was indeed a star business. And why was it clear? Because no one else was doing what they were doing. Their business model was completely different. Their cost structure was completely different. Their customers were completely different. All of their customers were sophisticated and quite large, not all of them, but most of them were sophisticated and quite large gamblers. And so they didn't compete with Ladbrokes or Corals, the Toad, the other British bookmakers.

• 55:41Richard Koch?

  And in fact, they didn't compete with anybody because there was nobody. There was actually another firm set up originally in San Francisco called Flutter. It had a slightly different business model. So it had no competition, it had infinite relative market share. So I said, well, that's fantastic. So he said, well, let me give you the website. You can go on and see how it works. Well, unfortunately, I couldn't because I didn't know how to work the website. And I went along and talked to the people and just tried to make sure that it was indeed a star business and that I thought that, you know, it could actually get some professional management later on. And so after an hour, I decided to invest.

• 56:26Richard Koch?

  One point five million pounds in that business. And they were quite shocked by that. They said, well, are you sure? And I explained to them what a star business was and how it was wonderful and how they should be very pleased to be having a star business and all the rest of it. But they were quite taken aback at that. And they had been trying to raise money again from institutions that all said no. And the mates that they had who put the money in originally, you know, didn't want to put more money in, particularly as they used that money much more quickly than expected. The reason they used the money much more quickly than expected was that the growth was fantastic. It was a tiny, tiny, tiny business, but it was growing at forty percent, fifty percent, even sixty percent a month. And I said, well, the other thing which I believe in apart from the star principle

• 57:11Richard Koch?

  is the compound growth rate. And so I, I looked at their financial projections and I thought they're incredibly conservative considering the market growth rate. And so I invested and I went on to the board and about four years later, the chaps had an away day at which I said how wonderful star businesses were and so on and so forth. And then I said, and actually last week, I decided it was time I actually learnt how to use the website that you have. And they all fell about laughing. They thought I was joking and I said, no, I did. I think it's great, great website. And they, they said to me, well, how could you possibly have invested in the business without sort of going on to the website? And I said, well, it's a star business.

• 57:56Richard Koch?

  And they said, I think I went down in their estimation quite considerably as a result of that.

• 58:03Richard Koch?

  And of course now I use the website most days. I think it's a wonderful website. I've sold my shares, so I'm not advertising the company or anything like that. But I ended up making about a hundred million pounds profit out of that investment. So that's the power of the star principle. So how can someone who's not numerate? Make money out of what is generally a highly numerous industry. Well, the answer to him is very simple. I believe in principles and I believe in the star principle. And it works. I'm the only investor in the world that does this. And I think I'm the only investor in the world at my scale, but doesn't employ anyone. And that does it on the basis of probably about a day a week of work. I do use my personal assistants to do some of the work.

• 58:47Richard Koch?

  I do use contacts for special particular jobs. But, you know, I don't have any staff. And, you know, when I tell people this, they say, well, your portfolio is X. That's unbelie- absolutely unbelievable. I said, well, you know, I've only got one question. When I invest in a business, is it a star business or could it be a star business? And once I've invested, I want to retain it as a star business or make it more dominant. And the only question is, how do you do that? And so life is very simple.

• 59:18Tim Ferriss?

  I'm laughing because we could have five hours and I'm going to run out of time before I run out of questions. So let's bookmark a few things. We're going to come back to knowledge versus principles. Okay, so we'll bookmark that. I want to just make it clear, at least from Wikipedia. And Wikipedia, of course, is subject to debate, but often inaccurate. And Betfair is described as the world's largest online betting exchange. Just for, for those who are looking for some type of perspective and are not familiar with the company. And you had mentioned gambling and liking gambling. I want to dig into that because it strikes me that you may enjoy gambling, but you're also very good at placing bets. And those are not necessarily the same thing.

• 1:00:01Tim Ferriss?

  If we think about the psychological dynamics, drivers and criteria involved. And I want to explain also to people listening that investing is a wonderful metaphor and framework for exploring principles that apply elsewhere. Thinking processes that apply elsewhere or perhaps even everywhere. So my question for you is very specific. 1.5 million. How did you decide on that bet sizing?

• 1:00:30Richard Koch?

  That was all the money I had. Holy shit. Wow. Okay. So you just pushed in all your chips? Yeah, they're all my liquid assets, you know, and this is quite typical for me. I want to be full in. Something I'll talk about later, which is that I, one of the things which is quite absurd about me is that I actually don't have very much money to spend and I don't really mind that. I tend to, when I'm in London, for example, in normal circumstances, I would take public transport. I would go on the bus or the tube. I would cycle if I possibly could, but I wouldn't take a taxi or even an Uber unless it was absolutely, you know, I was desperately short of time.

• 1:01:09Richard Koch?

  And I don't believe in being desperately short of time. I always make sure I have plenty of time because I don't want to be rushed and because I can always use the time to think or whatever. So how do I just decide on the bet size? You know, it's just a matter of what I have available if I think it's a good bet. I hasten to add, I don't make money out of my horse racing gambling. That is purely an entertainment and I don't place particularly large bets relative to my net worth either. If I can go for 18 months without having to put any more money in my account, I'm very happy. It's a different kind of bet. I mean, gambling, conventional gambling, whether it's poker or it's at the casino or it's horse racing or it's betting on tennis or baseball or football or anything like that.

• 1:01:54Richard Koch?

  I think there are people who make money at it, but they usually either have some inside information or they are incredibly skilled at judging probabilities and they often have, you know, even research. I know someone who had 50 employees tracking football in order to see whether the odds on particular football matches were right or not. And he would take positions and he made a lot of money out of that consistently every year. But you know, someone like me who doesn't know a lot about football, knows nothing about football, doesn't know a great deal about horse racing, is at a certain disadvantage. I just, I have a particular method which I use, which is based on looking not where the horse came in the race, but on the time relative to other times.

• 1:02:37Richard Koch?

  And all that is calculated on the Racing Post website. It's called, something called top speed. And whenever I make a lot of money in horse racing, it's because top speed has shown me a horse which is not far away from the favourite, but might be at odds of 30 to one, or in one case it was even 330 to one. That's unusual, but. Betting on companies is fantastic because if you understand how important relative market share is, and if you understand whether or not a company is able to segment itself and therefore have a defensive position in a particular segment like Betfair, then it's absolutely fantastic because you can, you know, you can basically invest and know

• 1:03:20Richard Koch?

  that you might lose your money, but overall you're going to do very well out of that. And, you know, I have very rarely lost money on star businesses. The cases where I've lost money is where I thought something might become a star business and it wasn't. Does that answer your question?

• 1:03:37Tim Ferriss?

  It does, and I have a whole handful more to follow up. So you wrote an entire book on this, The Star Principle 2008, that was published in 2008, work in investing in star businesses, that was the focus. When you say segment itself, businesses that can segment itself, and you mentioned Betfair, what does segmenting itself mean?

• 1:04:00Richard Koch?

  It means that it defines the market in a way that nobody else has done, or that very few people do, and therefore that it's possible to become the market leader in it. So Betfair is a very good example of that. It's a betting exchange, which is an electronic market where people can post bets on either side, buy or sell. It doesn't take principal positions as bookmakers do. So it's, once its overheads are covered, it can't lose money. And it competes against other betting exchanges, not against the big bookmakers. Because anyone who's a big gambler isn't going to go to Ladbrokes or Corals or The

• 1:04:41Richard Koch?

  Toad or Paddy Power or any of those conventional bookmakers because they know that the bookmaker typically takes out about 10% on each event. And Betfair takes out maybe 2%, but that's only half the time if you win half the time and lose half the time. So it's 1% plays 10%. And therefore, it means that the customer profile is completely different and the way that the cost structure operates is completely different. So it's a separate business segment because it's not competing with conventional betting firms. So it means that the company has to do something differently. It either

• 1:05:21Richard Koch?

  has to be have a price advantage and therefore a cost advantage in the way that Betfair does, or it has to offer something which is so attractive that people will pay, even if it's the same price, they will actually go to go there. So the three things that you want to do if you want to, what I call proposition simplify, are you have to have something which is very useful, you have to have something which is easy to use, and preferably you want something which is aesthetically pleasing, which gratifies you as a joy to use. And if you think about any of the Apple devices, then they created their own segments with

• 1:05:59Richard Koch?

  the iPod and the iPad and the iPhone and other devices because it was different from conventional competition. Even the Mac really didn't compete head to head with IBM. And anything where you can get a big price premium, for example, 30% plus, as Apple's been able to do on all of its devices, at least at the start, you have something which is a separate segment because it's not competing against the low cost competitor. And if you are going to be a low cost competitor, you want to be low cost in a segment which is different from the other segments because otherwise the existing large companies will eat you for breakfast.

• 1:06:40Tim Ferriss?

  You are unconventional in many different respects. And I'd like to ask you a personal question. You can feel free to decline to answer this question, but I'm very curious as to what your investment portfolio looks like, what principles govern its composition? Because you had mentioned that you're quite happy to have small amounts of liquid assets, you know, cash available. So what does your portfolio look like to the extent that you're comfortable discussing it? What are the principles that govern its composition?

• 1:07:16Richard Koch?

  It's pretty much an illustration of the 80/20 principle, but more so, I suppose my most valuable single, I've got about forty assets, companies in which I've invested, and the most valuable company in the portfolio constitutes about the half the total value, and another one constitutes about a quarter of the total value. And so in a way, that also simplifies my life, because if I take care of those two particular assets and know that they're going to do well, or think that they're going to do well, then I can be relatively relaxed. I'm quite happy to increase my share in companies once I know, or think I know, and I'm not infallible, that they are going to be successful.

• 1:08:00Richard Koch?

  So, for example, the company that is my largest single investment, I started off with a relatively modest investment and might have had about 2% of the company, and I'm now up to 60% of the company. And basically, what I'm doing is buying my shares from the existing shareholders whenever there is an opportunity to make an offer for shares, which is when I've got some money. So that's the principle. I don't have any rules on industry. I don't care what industry it's in. I don't really care very much what the management is like, because if the management doesn't perform, management will eventually get replaced. I don't really care where it is, as long as it's not, well, as long as it's in Europe, because I think I understand European markets.

• 1:08:45Richard Koch?

  I won't invest in the US because competition is too great, and also because I don't like the IRS, and also I don't know anything about American investment. So it's basically a European portfolio, industry irrelevant, and I don't care about concentration. In fact, I rather like concentration. Let's go back to getting fired.

• 1:09:12Tim Ferriss?

  Just to warm up the conversation. So what happened after you were fired? And could you actually tell us more about the day that you were fired? What was the conversation? What was that experience like? And then what happened after you were fired?

• 1:09:26Richard Koch?

  Well, it was a slow firing. And in fact, it was a very gentle firing. BCG liked McKinsey. McKinsey invented the phrase up or out. And at McKinsey, they would say that after three years, you would be assessed. And if you were really good at their business, you would get promoted. And if you weren't, you'd be asked to leave. But they would do it in a very, very nice way. Because they were sort of dividing the sheep and the goats. The sheep were the people who were good enough for McKinsey. And the goats were people who were good enough to be McKinsey clients. So that was their philosophy. And they were terribly nice to the people. But in fact, it was kind of like, it was a form of, I don't know. It was a form of sort of psychological one upmanship.

• 1:10:10Richard Koch?

  Because the people who left generally weren't as bright as the other people. It wasn't that they could do things that the McKinsey people couldn't do. It was that they weren't as bright in terms of the strategy of a business and analysis and so on and so forth. So that worked extremely well. Well, BCG did not have quite as rigid a formula as McKinsey. But they did have this policy that if after three or four years, you had not been made from a consultant into a manager, a consultant was the typical entry level for someone who'd been to business school, you'd be pretty much an anomaly would be the way that they would probably put it. And therefore, you might start thinking about what you wanted to do.

• 1:10:54Richard Koch?

  And so I had a number of those conversations with people. But I said to him, look, you're dead wrong. This was me. This is me in my arrogant youth. And maybe I haven't got rid of the arrogance altogether. I said, look, I'm no good at analysis, but I can charm the clients. I can talk to the clients. I'm quite articulate. And I can understand what the issues are, the strategic issues. And I can relate those to the clients. So, you know, I might not be very good at being a consultant. I might not even be very good at being a manager. But why don't you make me a vice president? Because I could actually do rather well. And they would chortle, they would say, Richard, you know, we have to have a hierarchy.

• 1:11:36Richard Koch?

  And I said, well, you know, X, Adrian, for example, Adrian's now a vice president. We all know that he was a pretty good consultant, but he wasn't a terribly good manager because he couldn't command the analysis and that's the heart of, you know, what BCG does. So he had to rely on other people to do it. But now he's a vice president, he's selling a lot of business very successfully and helping clients. So I'm like Adrian, basically. And they would again chortle a bit, but eventually a guy called, very nice guy called Phil Hume, who's later started Computer Centre and made quite a lot of money out of Computer Centre, sat me down and said, Richard, you know, you are running out of road a bit.

• 1:12:17Richard Koch?

  And I said, well, look, I got a fantastic assessment from Roy Barbie the other day, you know, and he said how much the clients love me. He said, yes, Rich, we know that, but basically you can't do what is really our power alley. So you maybe you sort of think about looking around. And I came out from that meeting thinking, is he right? Is he right about this or am I right? And I thought to myself, well, maybe he's right. So I actually then very quickly went to other consulting firms, to McKinsey and to Bain and Company to see whether.

• 1:12:51Tim Ferriss?

  May I say something, Richard, just for a second? That is, for people who don't have any context on management consulting, when you say McKinsey, when you talk about Boston Consulting Group, when you talk about Bain and Company, just as a point of reference for folks who may not be familiar with this industry, when I was studying at Princeton, there were exactly two industries that recruited heavily. You had the investment banks, you had Goldman Sachs and a handful like that. And then you had what were considered the elite of the elite of management consulting, and that included. McKinsey, BCG, in other words, Boston Consulting Group, Bain & Company and so on. So these are the most prestigious names in the world of of management or strategy consulting. I just wanted to to add that as a bit of background.

• 1:13:36Richard Koch?

  Yeah, I'm sorry. I assume that everyone knows and they don't. I mean, it's a very, when I was doing it, it was a very obscure industry. And now it's less obscure, but it's still pretty obscure. Anyway, I went to McKinsey, they said, no, you're a bright guy, but we don't think you should be doing this management consulting stuff because you want to make decisions rather than advise. And I said, yeah, that's probably true. Bain & Company, I'll come back to in a second. I then said, well, maybe I should be a headhunter. And I was actually approached by firm headhunters, some of whom knew me personally. And so I went off to see Egon Zender in Zurich with a view to becoming an, Egon Zender was the leading at that time, probably still is the leading European headhunter.

• 1:14:21Tim Ferriss?

  Just a footnote there for people, headhunting means recruiting, right?

• 1:14:25Richard Koch?

  At a very high level and taking very large amounts of money from the client. So anyway, I talked to Egon Zender and and he offered me a job on the spot and I very nearly accepted on the spot. But when I sort of examined my heart, I came back to the conclusion that I thought BCG was wrong and that I might not suit BCG, but I thought, you know, maybe I can get the job in another consulting firm. There happened to be another individual who had left the Boston Consulting Group and joined Bain & Company, a guy who rejoiced in the name of Floyd Bradley III. You might tell he was an American, very, very nice guy, quite a smart guy. Anyway, so he, I arranged to have a drink with him and said, I'm not too happy with BCG.

• 1:15:08Richard Koch?

  I don't think they're moving me on fast enough. How about Bain & Company? Do you think that they would be interesting? He said, yes, they're always looking for people that that find it quite difficult to recruit people at this stage. And so I said, fine, I'll go along and talk to them. So I went along and talked to the head of the London office and he said, we'll send you off to Boston. Now, this was very interesting for me. It was my one chance, basically, to stay in the industry that I wanted to stay in. The only problem with Bain & Company was that it had a reputation for being an extremely hierarchical, strict, controlled, almost mystical outfit, where you had to do what you were told. Whereas BCG actually was a pretty freewheeling entrepreneurial sort of firm, reflecting

• 1:15:53Richard Koch?

  the difference in character between the guy who had started BCG, Bruce Henderson, and the guy who runs, or ran, rather, Bain & Company. I should say that he's dead now, so I can't be sued for libel or slander or whatever it is, and neither can you. Although I have the utmost respect for Bill Bain, as I come on and say it in a second. So, they sent me off to Boston. So, there I was. I had a, you know, a four o'clock appointment with, to see Bill Bain. In the afternoon, so I got off the plane, got a cab to their off, Boston office, turned up at the desk and said, "I'm here to see Mr. Bain at four o'clock." And the woman sort of looked a bit confused and numerous. And basically, what had happened was that the, someone in the London office had not

• 1:16:39Richard Koch?

  told the Boston people, although they'd given me a ticket to go and see him, given me a, an appointment time. Apparently, it had not somehow not got into the agenda of Mr. Bain. So, they said, "Come back following morning." So, I went back following morning, and there I was. You know, I went through the offices. They were, the offices were quite remarkable, they're beautiful offices, but the associates, the consultants and the researchers were all hunched together. It was not quite a sweatshop, it was a very nice sweatshop, but you could see that they were either expanding very fast or very tight on the rental cost. And then, I went into Bill Bain's office, and it was palatial. You know, it was stuffed full of basketball and baseball, trophies and insignia and paraphernalia

• 1:17:24Richard Koch?

  of all sorts. And he was sitting behind this large desk and got up very graciously to meet me and said, "Do you want anything to drink?" I said, "No, I don't want anything, thank you." And then, he started talking to me. Well, it was very fortunate for me, because I didn't find out until afterwards, but it turned out that Bill Bain was a historian, that was his undergraduate degree, and in fact, he had Spent a year doing postgraduate research, which he eventually gave up because he thought it was terribly boring and because he got offered a better job as the Development Director of Vanderbilt University. But during the course of that interview, Bill Bain said something and I thought, well, I want to ask him a question, but he was in full flood.

• 1:18:05Richard Koch?

  So I let him carry on talking until probably about 20 minutes afterwards. And then I went back to it and said, you know, if I got it right, Mr. Bain, you said earlier such and such and such and such, and I want to ask you a question about that, blah, blah, blah. And he said, you're incredibly unusual. And I said, what? And he said, well, you're a very good listener and not many people are good listeners. And I wasn't aware that I was a good listener and maybe it was just I was so desperate to get a job that actually I was actually listening. But I was also very curious about the business because right at the start, when I had joined BCG, I thought, what a wonderful industry this is. It requires no working capital and basically they charge huge fees.

• 1:18:49Richard Koch?

  They don't pay people a hell of a lot of money. Eventually they give them bonuses, which is where the working capital comes from, the difference between the standard pay and the markup, which is some of which is eventually rebated to the professionals involved. And it's expanding very, very fast. And they've got this great model called the growth share matrix because it's got market growth on one axis and it's got the relative market share on the other. So they call it the growth share matrix, but it's more popularly known as the Boston Box. And it's this thing which has cash cows, dogs, question marks and stars.

• 1:19:24Tim Ferriss?

  The one thing I just wanted to say also as an observation of friends who have come out of McKinsey is that it seems that two by two matrices are very popular for organizing thought.

• 1:19:35Richard Koch?

  Yes, and in fact McKinsey went one better. They developed an imitation of the Boston Box, which was a three by three matrix.

• 1:19:43Richard Koch?

  But as always, economy is everything and it wasn't as good and it isn't as good in my humble opinion. Anyway, the end of the story is that Bill was quite taken with me and I was quite surprised and he said, I want you to come and talk to Ralph Willard, one of the other founders of Bain and Company. And Ralph was a very jolly chap and we got on very well and so on and so forth. So they actually offered me a job. And then I said to them, well, Ralph said, how much do you want to be paid? And I said, well, I'm earning such and such at Boston Consulting Group, but obviously if I'm going to take a step like this, I want a 50% increase.

• 1:20:19Tim Ferriss?

  50%?

• 1:20:20Richard Koch?

  That's ridiculous. And I said, well, you know, maybe you can just make me an advance for joining and not consolidate it into the salary. But, you know, at that stage, I was feeling confident that they wanted me. So I sort of raised the stakes a little bit. Despite the fact that at the beginning of the day, I was totally desperate. And if they'd offered me a job after an hour, I wouldn't have cared what they were going to pay. But anyway, they did eventually pay me quite a large amount of money to join. And at the same time, I then went back to BCG and said, you know, I think you're making a mistake. But if you want me to leave, you know, I've got all this money which I'm due in a few months' time as a bonus and the rest, and please, can I have that? And to

• 1:21:05Richard Koch?

  my surprise, they said, yes, okay. I mean, they were so desperate to get rid of me that they agreed. So I made quite a bit of money from BCG and from Bain and Company. So it was quite, apart from the fact that the previous two or three years had been very, very miserable. I redoubled my efforts to succeed at BCG. I worked 80 hours a week. I got fat in the face from eating fast food at night. I basically neglected my personal relationship. I stopped exercising. It was a complete disaster. And if I was to give advice to anybody who's in a similar situation, or even a less desperate situation, I would say, if you're not succeeding in a job, give up and go somewhere else where, you know, your talents can be better appreciated

• 1:21:49Richard Koch?

  or your talents are more suited to what that firm does. So I just, Tim, I just could not admit failure. This was the thing, you know, I just, to me, personal success was absolutely essential to my happiness. And it affected my self-image and all the rest. And I could not believe that these very intelligent people at BCG couldn't see

• 1:22:12Richard Koch?

  The things that I could do and it would have been far better for me to say, well, you know, they just have a different business model, analysis, quantitative, heavy duty stuff is their bag and you know, it's not something I can do particularly well. And so please give up and stop and, and you know, decide whether you want to be in the industry or decide if you do want to be in the industry, go to a competitor. So the long and short of that story is that it worked out extremely well in the end, but it was absolutely balls aching, very unpleasant. I wanted my pound of flesh at the end of all the suffering that we'd gone through.

• 1:22:50Tim Ferriss?

  What did Bain and Company appreciate about you or utilize in you that was not utilized or appreciated at BCG?

• 1:23:00Richard Koch?

  Oh, it was, it's very simple to answer that because I've always been interested in what I call the theology of business. And by that, I mean the business model that a particular firm has. And BCG and Bain and Company were very, very interesting to me. And this comes back to your first question about what am I good at doing? I actually did analyze in my mind, not quantitatively, the business model that BCG had and the business model that Bain and Company had. And they used the same concepts. They were all using, both using the, the growth share matrix of Boston Box, et cetera, which incidentally Bill Bain had helped to originate. So it wasn't really plagiarism. And indeed, BCG had put the stuff out there in the public domain.

• 1:23:45Richard Koch?

  So it wasn't, you know, they weren't doing anything underhand, but they were using all BCG's concepts, but the firms were completely different. And let me try and describe how they were very different. BCG, as I said before, was a very sort of decentralized company and the

• 1:24:03Richard Koch?

  Vice presidents who are in charge of particular clients were sort of almost autonomous profit centres. Bruce absolutely believed in the market. He was a red-toothed capitalist. You know, he really read in tooth and claw. He really believed in competition and so on and so forth. So much so that he divided his firm at one stage, and this is quite interesting. This was before my time. But he divided the firm into three different parts. And his view was that if one of those firms had developed a slightly different way of doing things, or if they were successful for any particular reason, then the other firms could learn from that. And the market would clear, as he was fond of saying.

• 1:24:49Richard Koch?

  And what happened was that he put Bill Bain, whom he had hired from Vanderbilt University, where he was a development director, and met Bill Bain because he had the begging bowl out as an alumnus of Vanderbilt, Bruce's an alumnus. And he asked Bruce, "Will you give money to Vanderbilt University?" And Bruce said, "No, but come to Boston and we'll talk about giving you a job." So, you know, that was kind of like the backstory from that point of view. But BCG was very, very decentralised. And even each individual consultant or all the professionals were actually profit centres. They were rewarded at the end of the year, not on how well they'd done, not on their team performance, not on anything really,

• 1:25:35Richard Koch?

  but what he called their billability, which is the number of hours that they had actually billed. And incidentally, I was probably one of the most billable people because I was willing to work very long hours. And because initially at least, anyway, people wanted me on their teams. And if they didn't want me, I could even sell my own work. So I had to be included in the people who were on that. But it was very, very decentralised. Bain and Company, on the other hand, was a very, very controlled, and I actually called it Stalinist later on, organisation, where it radiated out from Bill. Bill did all the thinking initially. And then the trusted vice presidents, who included Mitt Romney, who was a great guy,

• 1:26:20Richard Koch?

  a guy I've got tremendous admiration for, and four or five other vice presidents. And the formula in Bohnen Company was very, very tight and unforgiving, which is that they generated all of their business from a relationship with the chief executive or the head of the company, sometimes the president or the chairman of the company, but usually the chief executive, or maybe they were president and chief executive. And they would not work for anybody who was not the top dog in the organisation. So they wouldn't work for, you know, the head of Europe, or they wouldn't work for the head of manufacturing, or marketing, or any other function.

• 1:27:03Richard Koch?

  But they had a spiel which they gave to the chief executive of the company, which was, "Mr Chief Executive, we want you to be very successful. Because of your very successful, we will be very successful. We've got this funny little stuff called strategy, which really works, and we can explain it to you. But basically, you should think of it as a wonderful formula, a kind of like a secret sauce for increasing the market value of your company, profits and the market value. And if we do the work with your company, your share price will double within the first year or so, or the first two years anyway, and it will continue doubling every few years

• 1:27:44Richard Koch?

  because we have got a way of making a firm much more valuable, and we can describe that. But it relies upon you being willing to accept us as equal partners." And again, this was very, very different from the whole of the rest of the industry, which was, in a way, salesmen for hire, or cabs for hire, that, you know, consultants would do anything as long as they got their daily rate, and so on and so forth. They didn't really care too much about which firm they were working for, they would work for competitors and so forth. Bohnen Company said, "We will only work for one company in an industry," or later they refined that to a competitive system, which was a slightly more sophisticated way of

• 1:28:29Richard Koch?

  saying industry. And therefore... You know, we won't work for your competitors. You won't hire our competitors. So therefore you'd be giving a monopoly on strategy consulting, or any other form of consulting really, to Bain and Company if you decided to hire them. It's incredibly smart. Yeah. It's very smart. And the way in which they got clients, Tim, was that they had no website, but that wasn't unusual at the time. They had no business cards. They had no marketing literature. And the only way, and they were very secretive. The only way in which they got business was by personal recommendation of one chief executive to another chief executive.

• 1:29:13Richard Koch?

  And then within that firm, once the client had been signed on, you know, Guinness or Dun & Bradstreet or Baxter, Tram or whoever it was, they would then have almost a military operation where within each client organisation, someone from Bain and Company would be assigned to work alongside or with nominally for, you know, the head of manufacturing or the head of a particular product area or however the firm organised itself. And they would make sure that they understood what that person was thinking. They would help them by gathering this very valuable information, which Bain and Company did very, very well,

• 1:29:57Richard Koch?

  about competitors and customers and costs of the competitors. And they would, you know, develop a relationship. I couldn't believe it when I was told by Bain and Company when I joined, take the head of manufacturing out to dinner and discuss things with. I thought, yeah, the last thing I want to do is have dinner with the head of manufacturing, who is a very boring man. And it was all part of the job. And it was incredibly effective. Because, you know, whereas at BCG, they would go away for six months and they'd come back and give a presentation, which was dazzling. But then people in the audience, the managers, were free to disagree with what was recommended and often did cast doubt

• 1:30:41Richard Koch?

  on the credibility of BCG as a result of that, rightly or wrongly, usually wrongly. In Bain and Company, everything had to be pre-wired. So all the work was specified from the top down, but it was validated from the bottom up. So that once you've done a piece of work, you then had to show it to the relatively low-level manager and make sure that they agreed with it. And if they disagreed, they could only disagree about data, they couldn't disagree about concepts, because we were the kings of concepts. We knew relative market share was important and we could explain why. We weren't unreasonable. But nevertheless, when it eventually got to the chief executive and then later to

• 1:31:22Richard Koch?

  the board, it had all been pre-wired, which meant that everyone had agreed to everything. And therefore, there was no disagreement. And the only discussion which there'd be at the end of the presentation was about what Bain always used to call next steps. Well, let me tell you what next steps were. Next steps were, this is how we're going to make our next million dollars by consulting to you on this issue. But of course, it was justified, because Bain and Company was a fantastic machine for getting consensus in organisations and getting consensus about some very radical strategies, which might include getting out of half the businesses that they were in, selling them, or in some way hiding them off, or closing them down if they were cash negative

• 1:32:06Richard Koch?

  and no one would buy them. And then making acquisitions to strengthen existing businesses, or even to go into new areas, where Bain and Company would do all the investigation, because particularly if it was outside the industry that the company knew about, of course, they had no idea. So it was a wonderful machine for getting growth from existing clients. And this was what Bill Bain always used to say, "I have no idea why everyone's interested in new clients. We don't need new clients. We should have built-in growth from existing clients if we're doing our job correctly, if their profits are going up and the market value's going up." And of course, they didn't say no to new clients, and they used the existing clients

• 1:32:46Richard Koch?

  who were satisfied, particularly those who sat as non-executive directors, outside directors, on the boards of other companies, to say, you know, "I'd like to show you a sample of work which Bain and Company has done in our industry." And I participated in one of those events in New York. Where we were working for an information company and we went to present to a board of that information company, but one of the people on that board was the chief executive of a scientific company and subsequently they hired Bain and Company largely because, I think, of the recommendation of the chief executive and to a small degree, the quality

• 1:33:30Richard Koch?

  of dazzling quality of the presentation I made. Well, as a result of that, Bain and Company made me a partner, nominally a partner, a vice president, whereas I went in as a consultant and that would normally take several years. Well, that happened after eighteen months and it was a very interesting conversation with Bill Bain when he told me that I was going to be a partner of the firm. And what he said to me was, Richard, you know, I'm going to say something which might surprise you, you know, we've had our eye on you ever since you came and talked to me, blah, blah, blah, and I want you to be one of my partners. And I thought, you know, this is ridiculous. I, you know, I didn't expect this. And he said, but there is something which we're going to do and I don't think any other firm

• 1:34:13Richard Koch?

  in the world has ever done this, not to my knowledge, maybe you can correct me. But what they said was, we are going to promote you, but in only in nine months' time. And it's a done deal, you know, there's no question that you'll be one of my partners and I can even give you something to sign and sign something myself. But, you know, if we made you a partner now, people might wonder what on earth we were doing. In that nine months, you've got to behave as though you're already a partner without the authority of being a partner. But just through force of personality and through knowing that you are reflecting the Bain way of doing things, you will, when we actually make the announcement that you

• 1:34:54Richard Koch?

  are going to be a partner of the firm, everyone will say, well, of course, of course, rather than say, how come that caution's got promoted? That's unbelievable. So Bill was such a clever man at controlling his organisation and he didn't work very hard.

• 1:35:12Richard Koch?

  But it didn't work very long anyway, but he gave a great deal of thought to the procedures and to the management of his own company to make sure that everything that happened in Bain and Company had been initiated in one way or another by Bill Bain and make sure that that was the thing which was going to make the most money for Bill Bain, for Bain and Company, and also, I'm making it sound as though it's an incidental thing, but it was very important, it was the whole foundation of it, for the client organisation. It was just a fantastically well-run organisation and it grew at forty percent a year for twenty or thirty years, whereas BCG had struggled to grow at twenty percent.

• 1:35:54Richard Koch?

  Bain and Company fell on hard times, I think in the late nineteen eighties because they did a leveraged buyout, but that's another story. I'm not going to say any more about Bain and Company.

• 1:36:04Tim Ferriss?

  Well, I'm not going to let you off the hook that easily. You said, you explained rather, what Bill Bain asked of you to behave like a partner, even though you won't have the official title and you can't make the announcement until nine months hence. In practice, what did that look like? What changed in your behaviour or in what you did?

• 1:36:25Richard Koch?

  Oh, it totally changed me. It totally changed me. For one thing, it made me loyal and I was always someone who was on the verge of committing, you know, self-destruction, self-destructing because, because I'm a natural rebel. I'm a non-conformist, I'm very opinionated and almost unemployable. And that was the conclusion that everyone eventually came to, but, you know, in BCG, I was well-known for going off-script and I remember one of my appraisals was, most of the time, Richard, "He's like a volcano", this guy wrote, in a formal written assessment, and I've still got the assessment, it's lovely.

• 1:37:06Richard Koch?

  It said, "He's like a volcano, most of the time he's sort of, you know, working away and there are no rumblings and it's all very smooth, but occasionally he erupts like a volcano and he says something to the client which is not what we want the client to hear and he basically goes off at a tangent or he, you know, he has his own view about things." So when I'm with Richard and talking to the chief executive of the, you know, a big information company in Holland or whatever, I am very nervous.

• 1:37:41Richard Koch?

  I never know what Richard's gonna say. In Bain and Company, I'd have been fired if I'd have said, my vice president said, you know, something and I said, I agree with ninety nine point nine percent of that, but here's a slightly different view on naught point one percent. I'd have been out the door straight away. So it was, it was a complete contrast. So the first difference it made was I was, I felt very loyal to Bill personally and to the organisation, which I'd never really done before. I didn't do loyalty. I didn't really do teamwork very well. So that was the first difference it made. The second difference it made was that I decided that I would become much more direct with the people who were working with me.

• 1:38:26Richard Koch?

  If they were at the same level, if they were below me in the organisation, or even sometimes if they're slightly above me. But I did it very nicely. And so if I thought they were going in the wrong direction, I would say, well, you know, I've been thinking about this, Fred, and I think there's a better way of doing it than this. Instead of interviewing the customers in this segment, we should interview them in that segment. We should ask these questions rather than those questions, et cetera, et cetera. So it made me much more, paradoxically to me, it made me more diplomatic, but it also made me more assertive. And so it was great. I mean, I actually thought, gosh, they're gonna make me a partner and I'm gonna be a very successful partner and that's fantastic.

• 1:39:07Richard Koch?

  But it made me feel a little cautious because although Bill Bain has signed his bit of paper and all the rest of it, I knew that that meant nothing if he wanted to change his mind. So I thought, well, the prize is well within grasp. But I feel confident now. It gave me confidence. So I was able to do, I was much more effective as a result of that. In fact, I was probably more effective when I wasn't a partner than when I was because I was, I wanted it so much. But at the same time, I felt in some ways, although nobody knew that I had authority, in reality, I did. And that was a tremendous thing. And I don't understand why firms don't do this more broadly. It's a fantastic way of encouraging personal development and also of keeping people who

• 1:39:52Richard Koch?

  might otherwise decide to leave before they're given the nod that actually they are really appreciated and they are gonna get promoted.

• 1:40:00Tim Ferriss?

  I was going to ask you more about LEK, which was the consultancy you started, which experienced incredible growth. And we may get to that, but I want to skip ahead a little bit, and I'm going to do that in a foreshadowing fashion by mentioning the 80/20 principle, which we'll come back to. In an interview that I have in front of me, a separate interview, the question is, what book has had the single biggest impact on your career? And you answer my own book, The 80/20 Principle, because it's sold more than a million copies and it's been translated into more than 35 languages. It goes on and on about that, which we're going to return to. And then you say at the end of the answer that many of your books and much of your investing are related to ideas on strategy consulting. And you learn those firsthand,

• 1:40:45Tim Ferriss?

  not from books, but that you can recommend a book called Perspectives on Strategy, edited by Carl Stern and George Stock. Can you speak to what people might learn in that book and why you have recommended it?

• 1:40:59Richard Koch?

  It's a collection of the early perspectives of the Boston Consulting Group. And a perspective was what evangelical group would call a tract, I suppose. It would be something like 500 words, maybe 1,000 words, pretty short. It would be snazily presented in the livery of BCG, which was a very, quite a nice dark green color. And it would be mailed to the senior directors of companies in America and Britain, and then wherever BCG had offices. And the very valuable thing about the book is that a lot of the stuff is by Bruce Henderson himself, but there's also more modern stuff.

• 1:41:42Richard Koch?

  And it outlines the theory that BCG had in the early days, which I think is still entirely valid, of competition, the experience curve, the Boston box, the gross share matrix, et cetera. And it's just a very, very good primer. And there are many, many books on business strategy, including one which I've written. But I think this is a very, very good thing. And it's very easy to read because it was deliberately designed. To do that, Bruce laid out the principles for the perspectives very clearly, which was anything that a chief executive would be likely to agree with was not argued.

• 1:42:23Richard Koch?

  I mean, it was stated and anything that the chief executive would be likely to disagree with, which was quite a lot, because BCG was on the mission of saying companies should reduce their costs and reduce their prices steadily. Whereas the conventional wisdom in business at that time was if you get a higher price, stick with it and don't worry too much about the costs. And Bruce had a whole theology around that. And it's great because it's a collection of those different perspectives and it's over several years. So you get the more modern stuff as well. I think it was published in 2000 or something like that. So it is difficult to get good books on strategy. There's a book by someone called Richard, oh God, I can't remember his name, called

• 1:43:07Richard Koch?

  Good Strategy, Bad Strategy. He'll come back to me, but anyway, you can type it into Amazon if you want. Good Strategy, Bad Strategy. That's actually a very good strategy book, very not very nice short strategy book. And there's my Financial Times Guide to Strategy. We're going to give a small plug to, out of print at the moment, but I'm producing the fifth edition as we speak, at the same time, in the same period of time.

• 1:43:29Tim Ferriss?

  Good Strategy, Bad Strategy by Richard Rumelt. Does that sound correct?

• 1:43:33Richard Koch?

  God, isn't the web amazing? Aren't you amazing? It'd be far more impressive if I was actually pressing the keys and came up with that myself, but I don't do that.

• 1:43:43Tim Ferriss?

  Well, I'll give away one of my tricks and that is if I'm recording an interview like this, I don't use my keyboard. I have my phone on silence so that I can tap the screen without making noise to find things like that.

• 1:43:57Richard Koch?

  You're very clever. Well, you do that, you can have a funky who did that for you, but it's very impressive that you do it yourself.

• 1:44:03Tim Ferriss?

  That's true. Well, it's just for on the spot tap dancing like that. Earlier in the conversation, I made a promise to the listeners and that was in the form of alluding to knowledge versus principles, which I think is perhaps a useful way to segue to the 80/20 principle. And From mergersandinquisitions.com, which is a great website, the distinction that I've read you drawing is the following: What I learned from consulting is exactly what I've been teaching. Knowledge is great, but principles are better. Principles are ideas that enable you to sort the knowledge, helps you to analyze it, and get to the essence of the matter as simply and quickly as possible. Would you like to add anything to why principles are important? And the second part of that is, how did the 80/20 principle come to be as

• 1:44:48Tim Ferriss?

  a book? Because it was very much an underground, became an underground bestseller. So, principles? Anything more that you would like to add? And then, where did this book come from?

• 1:44:57Richard Koch?

  No, I think you put it very well. I just think there are certain meta-principles, and I think there are probably only about half a dozen of them, for the benefit of myself and the people that I work with and invest with, invest in, rather. It's basically the 80/20 principle and the STAR principle. So, if you know what those are, then you can look at the business in a way that most people don't look at the business, very quickly, and see whether there's potential for improvement. And we'll talk about that in regard to the 80/20 principle in a second, no doubt. But, how did the book come about? Well, again, that's quite interesting, at least interesting to me, which is that I wrote something called

• 1:45:38Richard Koch?

  "The A to Z of Management," because I had an editor who was currently working at Pearson, and later left to start his own firm with another editor there. And the editor was called Mark Allen, the other editor was called Richard Burton, very, very skilled guys, very nice guys. And they were looking to, sort of, you know, try and get something by me published. And Mark Allen said to me, "You've written this thing called 'The A to Z of Management,' which is basically a paragraph about various different concepts. And it covered all the principles I could think of. It also covered important theorists in business."

• 1:46:22Richard Koch?

  And it covered anything which was of interest in business and it also covered jargon phrases like, you know, what did, what did people mean by work in progress and stuff like that. Anyway, I'd written half a page on the eighty twenty principle and I went to see Mark Allen one day in his offices in Covent Garden and he said to me, Richard, I've got a book for you to write. I said, yeah. And he said, what about writing a book about the eighty twenty principle? Because you've got this half page on it here and it seems to be quite an important thing. You say it's very important and I can understand it's very important. So why don't you write a book on that? I said, Mark, I couldn't possibly. I can possibly write a book about the eighty twenty principle.

• 1:47:07Richard Koch?

  I've said it all in that paragraph and I could maybe pad it out to a page. If you really put a gun to my head, I could write a chapter. But I'm not going to write a whole bloody book about this because there isn't anything more to say. And he said, well, I'm not so sure about that. Then he decided that they, he would go off and start this other publishing company. So he wasn't interested in me doing it for them and they had not got themselves organised. So I went to see a guy called Nicholas Brearley, who was the publisher of the eponymous firm, Nicholas Brearley, and very, very, very nice

• 1:47:47Richard Koch?

  man, but incredibly smart guy. And I'd written a book for him called Managing Without Management, which was a title which he suggested. It was very clever because it basically said managing, in particular middle management, was a complete waste of time. And so you could manage without it, managing without management. And the book wasn't a huge success, but it sold, I don't know, 20,000 copies, which was good enough for Nicholas Brearley at that time. And I went to see him about another book shortly after I'd had the conversation with Mark Allen. And he said, do you have another book in mind? I said, well, not really. But this, this sort of idea that someone's given me and, you know, they've got first dibs on the publishing it if I could ever write a book about it, but I don't think

• 1:48:32Richard Koch?

  I could write a book about it. And then I described him what the eighty twenty principle was. And honestly, I didn't take more than about 60 seconds because there wasn't much to say as far as I'm concerned. And he said, the hairs on the back of my head are rising. And I said, what do you mean? I thought, I thought he'd lost his clock or something like that. And that can be a big, successful book. And I said, no, I mean, well, maybe, but how do I pad it out to a book's length? He said, go and do some research. You know, you've mentioned the Alfredo Pareto, you know, read the book again, read all the other stuff, read all the stuff on the web, you know. And the truth was that there was a hell of a lot of stuff on the internet. And this was back in 1996, book was eventually published

• 1:49:15Richard Koch?

  in 1997. You know, this was a golden, the beginning of the golden period of the internet. And I hired a researcher and said, find out everything that's going on on the internet, on the 80/20 principle. At that stage, I didn't know how to use the internet. So she came back and gave me this whole wodge, the whole file. And I said, Diane, is that all about the 80/20 principle? And she said, yes. And I said, well, maybe I could write a book. So anyway, I went through it all. And the more I went into it, the deeper it actually, and the more interesting it was. And so that's how I ended up writing books. So I went back to my original guy, Mark Allen, said, do you want to publish this book?

• 1:49:56Richard Koch?

  He said, no, we can't. We've left Pearson at the time, and we haven't started our firm yet. So I went back to Nicholas Brearley, and he was very pleased. And that, you know, the first draft I produced, he said, very politely, he said, I think you need to go and do some more research. And it was pretty hopeless, actually. But the second draft, I took back and he more or less published it as it was, because by that stage, I'd worked it through. And it was a, it was a great thinking exercise for me. And the whole point about making a book out of it was that I extended the reach of the principle. The basic 80/20 principle, as I'm sure nearly all your listeners know, is that if you look

• 1:50:40Richard Koch?

  at any particular relationship between sales and another variable, or you look at time and another variable you might be interested in, it's usually true that there are very few events or data which account for a large majority of the total. And so if you look at the profits of any company by customer, usually there are a very small number of customers, a very small proportion of the total, who account for Eighty percent of the sales and maybe more than a hundred percent of the profits of a company. And likewise, if you do the same thing for products, you're likely to find the same thing.

• 1:51:23Richard Koch?

  This was a well-known economic concept. Anyone had been to business school and heard it was generally called the Pareto Rule at that time. But I wanted to call it the eighty twenty principle because it was more descriptive. A rule to me sounded too deterministic. Principle sounded to me exactly right. So I actually invented, I think, the eighty twenty principle. I don't know if anyone ever called it that beforehand. They would call it the eighty twenty rule or the Pareto Rule. So the idea seemed to me to be applicable well beyond the sphere that had been used before, which was for really analyzing sales and profits. And I said, well, why can't we use the eighty twenty principle in other areas?

• 1:52:07Richard Koch?

  In people's personal lives, for example. And so I I became quite fascinated by the connection between time and results. And then it was a short hop from that to extend that. So basically, I would say to people, well, the hypothesis. And the whole thing about the eighty twenty principle is not that it's a rule, but it's a an observation. So you come up with a hypothesis and then you test whether it's true with data if you possibly can, but with, you know, seeing if you think it really is true. If it's something much more subjective and squishy. So you actually could then say, well, it's probably true. It may be true that twenty percent of your time generates eighty percent of your useful output.

• 1:52:52Richard Koch?

  So tell me what the most valuable things are that you do. And I would say that to people at work and they would have no difficulty at all in saying, well, it was inventing this new product or it was selling a large job to this particular customer. Or it was writing some copy, which is, you know, very, very effective, or it was making a website or whatever it was. And I would say to them, well, you know, you've got to do more of that and less of the other stuff. And I'd also say to people that if you manage to do something which is hugely more valuable than the other stuff, and you do that in half a day, take the rest of the day off. And if you do that for two days, take the rest of the week off, if you want to, you know, if you want to carry on

• 1:53:33Richard Koch?

  working and do even more, that's right. But as Parkinson said, work expands to fill the time available, spending expands to fill the budget which you've got to spend it, whether it's inside a firm or it's your own money. I was quite interested, incidentally, in hearing an observation which one of your other interviewees said about the Wall Street of the, well, I don't know, was it 1980s or whatever. And basically, people got very, very used to the money which they'd earned. They were hugely overpaid, but nevertheless, they found ways to use that. And that was a big trap for them, not for him, but for the others. Because what they did was that they got locked

• 1:54:15Richard Koch?

  into working for Salomon Brothers or Goldman Sachs or whatever. And after a time, they couldn't really leave because their wives or their their own personal tastes had developed to such an extent, or their husbands, they needed the money, you know, they had to have half a million dollars a year. They couldn't live on less. So I was saying to people, well, let's extend this to your personal life as well. So if time is important at work, then maybe time is important elsewhere. And maybe you get most of your happiness from a relatively small proportion of your time. What are the periods of time where you actually feel that you are being fulfilled, that you feel

• 1:54:56Richard Koch?

  you don't notice time escaping, when you feel that this is great, and you wake up and you find that, you know, the night's gone. It might be playing poker, it might be talking to friends, it might be reading something that's very exciting, might be going to see a movie or whatever. But what are the times that you are happiest? And then just try and multiply those times. And then I said, well, you could apply that to friends. Let's take the eighty twenty hypothesis that you get eighty percent of your relationship satisfaction from twenty percent of people. I mean, it's a bit gross in a way, but it's very true. I found when talking to people that very often they spent time with people they didn't really like very much.

• 1:55:40Richard Koch?

  I mean, obviously, sometimes it was their boss, so, you know, that was a disaster. And they bloody well better get a different boss or a different firm. But sometimes it was as simple as things like, well, your spouse actually liked these people, but you didn't. So you ended up spending a lot of time with neighbors or with other people or members of his or her family that you didn't really want to spend. And what you really wanted to spend your time on was something different. And so I said to people, well, you know, you might want to be a bit more ruthless about that. And so there's a chapter on happiness in the book, which I was rereading recently. And I think it's actually rather good. I mean, it's taking this sort of rather arcane, dusty economic principle and then seeing

• 1:56:25Richard Koch?

  whether it could apply to other areas of life. And I invented the concept of happiness islands. Well, happiness island is part of your life, which is sort of not the main part of the life. But when you get a huge amount of satisfaction from it. And I said, well, live on those happiness islands and try if possible to make them happiness continents. So if there's a particular type of work which you like doing at work, then try and get yourself in a position where you're spending all your time doing that sort of work and so on and so forth. And I see it in many ways as a kind of amateur version of the flow idea, which is that, you know, that these times, according to the guy with the unpronounceable name, I mean, Haley. Mikhail Chek set me high, something like that.

• 1:57:09Richard Koch?

  Yeah, he's written a couple of books about this. It all boils down. I mean, I think that. They say eighty twenty principle could be written on one page. I think that could all be written on one page. But it's a fantastic idea. It's a slightly more sophisticated way of saying what I was trying to say. And there's stuff on there in money and all the rest of it. So it was a reinterpretation of the principle to apply it to, not just to business, but to people's personal lives and to try and say a few things which were really useful and which people could take away, which is what you do, isn't it?

• 1:57:42Tim Ferriss?

  That's what I try to do. That's what I certainly try to do. And for all the reasons you just mentioned and many more, this is why the eighty twenty principle, your book, faces cover out on my bookshelf and has for a very, very long time as a constant reminder. Could you share, just as examples, because it may help people listening, some examples of your own happiness islands or achievement islands?

• 1:58:08Richard Koch?

  Yes, I can do that. The things that I really like doing are writing books and making money and making money through investments, not through gambling or anything like that, and talking to people. I really used to like going to dinner parties in the days when we had dinner parties.

• 1:58:28Richard Koch?

  I really like to go for long walks with people, not many people, but a few people that I know. We will discover something that we didn't know we knew beforehand. Those are the things that really are interesting. Doing something like this podcast is a flow activity, as far as I'm concerned, an eighty twenty activity. So it's that sort of stuff. It's books, it's writing books, it's also reading books, and it's talking to people, and it's also making money through investments.

• 1:58:59Tim Ferriss?

  Do you have any regular or scheduled check-ins or calendared reviews where?

• 1:59:09Tim Ferriss?

  You assess your life to ensure that you're allocating your time and energy to match what you know to be happiness islands or achievement islands. In other words, how do you use, if you do in any systematic way, the 80/20 principle in your life?

• 1:59:24Richard Koch?

  No, is the short answer, but let me qualify that a little bit. I do something which is very unsophisticated. Other people have therapists and other people have personal trainers and other people have, you know, quite elaborate systems for, for keeping track of their objectives or their concerns, their worries and so on and so forth. I have bike rides. Every day I go for a two-hour bike ride in the countryside. It is every day unless I'm away or unless I'm in Cape Town. I've got a home in Cape Town and it's too dangerous to ride a bicycle there. But everywhere else I will ride a bicycle and I take pretty much the same route every day,

• 2:00:07Richard Koch?

  very unadventurous. I've got two alternative routes in Portugal, for example. And during those bike rides, something will come up sometimes, not very often, but something will always come up. At the very least, I will work out what I'm going to do that day because that's one output from a bike ride and it just happens automatically. I don't even have to think about it.

• 2:00:28Tim Ferriss?

  When do you do the bike rides? I presume in the mornings?

• 2:00:31Richard Koch?

  In the morning, yeah. I don't answer emails. I don't look at my phone. I do have a cup of tea and sometimes I take the dog for a walk, but apart from that, it's the bike ride. It's wonderful. I mean, you know, I couldn't do without it. And in fact, when I'm away and I can't ride a bicycle, I'm talking to you from Gibraltar, for example, and I do spend a fair bit of time in Gibraltar where I have an apartment. But here, it's also too dangerous to ride because the streets are too narrow and there I have to substitute going for a walk or going to the gym. But basically, a form of exercise which is mindless, which is, you know, not too difficult, but enjoyable, where I can just relax and let my unconscious mind do whatever it does.

• 2:01:14Richard Koch?

  That's how I do those sort of things. And occasionally, I go and sit on my fish pond with a notebook and say, it's time to think about some reflections. I make a point of only doing that when I'm in a good mood. I never do it when I'm actually feeling slightly down. I'm usually in a good mood, but it's something to do when you're being expansive rather than you're doubting yourself. And I keep those notebooks and very occasionally also, I wake up in the middle of the night and I have thought of something that I had not thought of before. And then I have a notebook by the bed. If it's not by the bed, it's in my office, which is very close to my bedroom.

• 2:01:55Richard Koch?

  And so I will make a cup of tea, put the light on, write my thoughts, put the book down, put the lights out, go to sleep. And those thoughts are usually quite seminal. They're very, very helpful. But it all happens sort of automatically. I don't have any systems or anything like that. Do you?

• 2:02:12Tim Ferriss?

  Well, I would say I have acute hypergraphia and take copious notes, most of which end up never being read and certainly most of which end up being completely unimportant. But amongst all the garbage, there are occasionally useful things. I find journaling very helpful for me, in different forms.

• 2:02:35Richard Koch?

  It's the writing which is important, isn't it? It's the writing. The writing somehow ingrains it on your mind. Do you find that?

• 2:02:43Tim Ferriss?

  I do find that.

• 2:02:44Richard Koch?

  It's not, as you say, one may never review the notes. I do actually review my notebooks when I'm on a plane and got nothing better to do and no book to read. But it isn't that. It's actually the process of, I think the process of writing, journaling is very, very, very useful. But I don't do it every day and I don't do it systematically. I just do it when I feel the need to do it.

• 2:03:06Tim Ferriss?

  I would say I have two different types of journaling and then I'd like to ask you about your time at the pond in a moment and just what that actually looks like and maybe some examples from what you've written down. I would say I have two types of journaling. The first is almost entirely like emptying the garbage bin on a Mac to purge the system. It is simply to trap my monkey mind and all of the bullets ricocheting around inside my mind on paper so that I can get on with my day in a better fashion. The second type is more deliberate and objective driven where I might sit down and very explicitly do an 80/20

• 2:03:48Tim Ferriss?

  analysis of the types that you've been describing, looking at how my time is being used. Look at my calendar to see if it actually matches what I say is important to me, etc. So there are, I'd say there's two main categories. Morning pages from Julia Cameron's template would be in the former as an example, but when you go to the pond and you sit down and you're in an expansive mood and you journal, what does that look like? Is it stream of consciousness? Are there certain prompts that you might use? Could you give us any real world examples of what has come from those types of sessions?

• 2:04:23Richard Koch?

  Yes. I mean, what I do is I write reflections and I put the date and then I put numbers and then I just start writing. And one of the things that comes out from that, which came out from that recently, was thinking about my investments. And I was struck by the fact that I was average, to say I was average timing each investment would not be fair, but I was spending a lot of time on stuff that actually wasn't at all important. And I was doing it partly through interest, partly because I perhaps felt some residual sense of obligation to the people who were managing the firm and other shareholders. So, you know, one of the things which I decided

• 2:05:05Richard Koch?

  was I was not going to worry about any companies which were outside the first, you know, half dozen in terms of the value of those companies unless the value was increasing very fast or had the potential to increase very fast. And the other thing which I realized, because I'm always almost completely invested, was that that was not actually a terribly sensible thing to do. And the next time I have a major realization, I should be prepared and I should have two or three companies which are new companies. In other words, investments I have not yet made, where they do have the potential to be star businesses or they already are star businesses, where I like the people involved.

• 2:05:47Richard Koch?

  And that's a sin I quite know for me, that I don't invest in things unless I actually like the people. And where a relatively small amount of money might conceivably be another Betfair or whatever. So it's quite easy for me, because I've got a couple of companies that are increasing in value quite fast and I'm reasonably confident that they will continue to do so over the next few years, to be sort of, you know, rather complacent about that. But in order to maintain the sort of rate of return that I've had historically and that I want, I probably need to find a new Betfair or two or three new Betfares over the next five years. And I should give a bit more attention to trawling for that and talking to my contacts that might conceivably know such companies.

• 2:06:31Richard Koch?

  And actually, you know, I do get some leads and don't always follow them up very well. So, yes, so it can be useful from that point of view. And the other thing which I've realised as a result of journaling in the last few months is that I am too socially isolated. I mean, I've got some very good friends. I don't see them as often as I would like. And because I have such a really nice life, living in very pretty places and living in sunny places generally, which is very important for me to be outdoors, so that I can play tennis or ride the bicycle or sit on the fish pond or whatever, I ought to pay more attention to social interaction

• 2:07:13Richard Koch?

  and to spending more time with the people that I enjoy spending time, but they're not, they're not close to where I am. So those are sort of conclusions which have come up in the last six months. And then there are the more philosophical conclusions which you sometimes come to, which sometimes you write down. For example, One of the things which I've learnt in the last few years is I have been far too much of what I call a controller and far too little of what I call an adventurer. And my life has always run upon lines of saying, I must do this, I must achieve this, I must make this sort of amount of money, I must have this type of job, I must do this kind of thing, I must start a company and so on and so forth.

• 2:07:59Richard Koch?

  But recently, I have realised that the people who have most fun in life are more the adventurer type than the controllers. In fact, to come back to something and I hope we're going to spend a little bit of time on later on, which is my new book, Unreasonable Success and How to Achieve It. There are 20 people who changed the world, in my opinion, in that book. And it is not in the book at all, but it's something which I did after the event. I divided those very successful people into controllers and adventurers, and I was quite surprised to find that 14 of them were actually adventurers in one form or another.

• 2:08:38Richard Koch?

  And only six of them were controllers. There were some who were both, but you know, that was the count, taking halves into account. And for example, one of the people who was a controller in the book was a sort of my evil, evil, successful person, which was Vladimir Lenin. And you know, his life was pretty unpleasant because he was always trying to control other people and it was a very uphill struggle. And he achieved a great deal in his terms. I mean, not things that I would approve of, but he was the founder of practical communism. And he basically made communism a success in very large parts of the world, a success in the sense that they remained communist.

• 2:09:22Richard Koch?

  And they did develop the countries where perhaps not as fast as they would have developed under a free market system. But you know, from that point of view, he was very, very successful, but he didn't have much of a great time. Whereas some of the people who were much more freewheeling, for example, the freewheeling Bob Dylan, or even Otto von Bismarck, they had much more fun because they Although they were determined to achieve things, they relied upon events flowing their way and they just bided their time until the right moment came along and then they then they worked, then they basically made a huge effort to control or not not control events, but to actually steer them. One of the great quotes which I like is from Bismarck,

• 2:10:06Richard Koch?

  who said, "Man cannot control the flow of events. All he can do is ride with them and steer." So I, you know, you sometimes you get those sort of kind of philosophical reflections coming up. More often though, probably on a bike ride and then I might write it down afterwards. But I actually find it quite difficult to be as radical as that, just sitting down and writing. I tend to write, you know, things which are, they're much less important in a way, they're less distant.

• 2:10:36Tim Ferriss?

  Let's, this was on my, my next note to segue into, that is the new books. Let's, let's talk about the genesis story. And this is always interesting to me as someone who occasionally tries to wordsmith things. And that is the sort of embarrassment of riches that you no doubt have in terms of possible subjects you could explore. So Unreasonable Success and How to Achieve It, you've written many books. Why this book?

• 2:11:04Richard Koch?

  I've always been fascinated by success and I've always been fascinated by the discrepancy, really, between, as I see it, the arbitrary nature of success in many ways, which is that the people who are successful are not necessarily the people who are most intelligent or most expected to succeed or who deserve it. Many of the 20 people that I highlight in the book weren't even competent. Winston Churchill was a prime example of someone who was a complete failure through most of his career. Got one thing right, which was that Hitler was a threat to the world and that he knew how to deal with Hitler. But basically, the man was a disaster and he thought that oratory would propel him to become prime minister.

• 2:11:48Richard Koch?

  But, you know, as Herbert Asquith said, "It does not matter if you speak with the tongues of men and angels. If nobody trusts you." It was directed exactly at Churchill. So I've always been fascinated by success, but the actual genesis of the book, as you said, came on a train journey. I was travelling from Paris with a friend of mine to Lyon, and I always take a book with me, and I didn't have a book, a new book that I wanted to read. So I took an old book, which was Malcolm Gladwell's Outliers. And you probably remember that in Outliers, the whole thesis is that success derives from deep experience and long exposure to doing something in a very narrow field.

• 2:12:31Richard Koch?

  And he came up with the idea of the 10,000 hours, which is now a trope, something which everyone talks about. And he gave a couple of examples very early on in the book, which resonate very nicely, which are the Beatles, for example, in 1960, they were just a rather poor high street band. And then something happened to them, which was that they went off to the strip clubs of Hamburg, and they had to play seven days a week, eight hours a day. And as John Lennon's quoted in the book as saying, "We couldn't help improve with all of that extra experience." And then he quotes the example of Bill Gates, who because he went to a private school,

• 2:13:13Richard Koch?

  which unlike the vast majority of schools at the time in America or anywhere else, had got computers, you know, he was able to acquire expertise in coding and how to use computers. And that was his sort of, you know, he got his 10,000 hours in very, very quickly. So the problem with that thesis is that it's not universally true. It certainly applies to Bill Gates, it certainly applies to the Beatles, and it applies to some other people as well. But of the people that I looked at, that couldn't explain it. And what I did was I took 20 people whose life stories I knew well. Some, in some cases, I knew them personally, such as Bruce Henderson, Bill Bain, who I've talked about before,

• 2:13:56Richard Koch?

  who were very important to me and hugely underrated in terms of the impact which they've had on American and world business, in my, in my opinion. But I took those people and then I said, Would it be possible to do what Malcolm Gladwell set out to do and in my opinion did not succeed in doing? Would it be possible to look at the causes of success for those people and identify things which were common to all 20 people, which they all had or did? It might be an experience that they had, or it might be an attitude which they had, or it might be a way that they exploited particular opportunities. Would it be possible to look at that and say that there are things which are so universally

• 2:14:38Richard Koch?

  present that if you want to be what I call unreasonably successful, which is more than you deserve if you like, terrifically successful in changing the world the way you want to work, change it, it might be a small corner of the world, it might be a big corner of the world. Would it be possible to isolate the reasons for that? And I looked at 50 possible reasons. For example, I looked at would you need to be a high risk taker? And the answer was of those 20 people, only nine of them actually took very high risk. Of 20 people in my book, only nine of them actually took very high risk. So that went away. And then I narrowed it down to nine reasons, which were universally present in all of the cases. And I did not throw people out if they didn't meet the nine requirements. I was quite rigorous with myself.

• 2:15:23Richard Koch?

  I said, no. And the people that I, the players that I took were, besides Bill Burns and Bruce Henderson, there was Jeff Bezos, Otto van Bismarck, Winston Churchill, Mary Curie, Leonardo, Leonardo da Vinci, Walt Disney, Bob Dylan, Albert Einstein, Viktor Frankl, the guy who was shoved into a concentration camp by Hitler that came up as the third wave of psychology after Freud and Adler, and was probably the first real existential philosopher. Bruce Henderson, I mentioned, Steve Jobs, John Maynard Keynes, who saved the world from fascism and communism, perhaps as a result of saying that you didn't have to have very high unemployment and the state could step in and that would be fine, under a liberal capitalist regime. Lenin, I mentioned, Madonna, Nelson Mandela.

• 2:16:09Richard Koch?

  Totally obscure guy who was imprisoned on Robben Island 17 years, but somehow managed to negotiate a democracy in South Africa. J K Rowling, Helena Rubinstein formed the eponymous cosmetics company before anybody else had a cosmetics company. The person who I think was most successful of all of my 20 people, Paul of Tarsus. I don't like calling him Saint Paul because it makes him sound establishment figure. He was never an establishment figure. He had this vision of the living Christ. And he preached that throughout the Roman world. But he did something that none of the other followers of Jesus did, which as you said,

• 2:16:50Richard Koch?

  following a Jewish customer base, if you like, is not the way to make a new religion take off. We don't want to be a very small sect within Judaism. I actually want to convert people in the whole world. And therefore what we need to do is to turn, you know, that sort of Jewish religion that Jesus had been enveloped within and take away from that the things which actually were universally applicable. So, you know, without Paul, what eventually emerged as Christianity would never have either achieved lift off nor transcended its Jewish roots. So fantastically successful, you know, I mean, who would have thought that Christianity could actually succeed?

• 2:17:34Richard Koch?

  It was just a miracle. Margaret Thatcher was the other, was the other one of the 20 people. So I came up with these nine things which were common to all of them. I'll rattle through those if you like.

• 2:17:45Tim Ferriss?

  Definitely. Feel free to list the nine. But before we do that, if you could just take a moment to define success, since many people define success differently. Could you speak to what that means in the context of unreasonable success? Is it achieving what they set out to do or is it something else? And then I would love to know what the nine characteristics are.

• 2:18:10Richard Koch?

  Yes, it is. I think success is very subjective and can only be the person's objectives. And I mean, people said to me, what, how on earth can you put Lenin in the book? And in fact, at one stage, I had Hitler in the book and the publishers insisted on it being thrown out because they said the booksellers would never sell it if it was in the book. I said, well, we don't like Hitler, in favour of Hitler. They said, no, Hitler's got to go. So it's value free in the sense that it is what they achieved which changed the world the way they wanted to change it, whether that was a good thing or a bad thing or an indifferent thing. That's unreasonable success in one definition. Success is a whole continuum as far as I'm concerned. And, you know, I'm not against minor successes at all, that's absolutely great.

• 2:18:52Richard Koch?

  But what I was really interested in, in order to establish the most important causes of major success, is what I called unreasonable success, and I had four criteria for that. You could say that in a word, it's undeserved success, but that's a little bit unfair. Firstly, it's such success in changing the world, it seems unreasonable for one individual to do that. I mean, we live in a world which is quite collective and which is governed by culture and constraints which are quite immovable. We think the world's changing very fast, but in many ways the world doesn't change very fast. And then suddenly it does. And what usually is behind that is not a huge number of people doing something.

• 2:19:34Richard Koch?

  It's an individual deciding to do something and managing to persuade other people to do that. So it's unreasonable in the sense that one person has all of that impact. Secondly, it's success that is unexpected and was not predicted when the individual was young or early in their career. So it's kind of, you know, it's success which comes from nowhere. Thirdly, it's success that goes well beyond what the individual's skills and performance seem to warrant. And Winston Churchill, a jolly good example of that. Some would say that the British Prime Minister Boris Johnson is an example of that. Completely disastrous Foreign Secretary, probably completely incompetent when he's dealing with the coronavirus. But nevertheless, I think may well go down in history as a great Prime Minister because

• 2:20:19Richard Koch?

  he has certain objectives that he wants to achieve, like making sure Britain did leave the European Union and maybe doing something about the excessive price of housing in Britain. The fact that it's almost impossible for young people to actually buy a house these days. And also, you know, Britain's a hugely over-centralised country, London-centric country, and there are left-behind areas of Britain, which basically is most of the rest that's not in the south-east of Britain. And I think Boris Johnson wants to do something about that, and if he's able to do that, that would be a fantastic achievement. I know that you're interested in very practical things, so in the book I discuss what do you do if you don't have self-belief?

• 2:21:02Richard Koch?

  And for example, one of the things that you can do is to realise it has to be in a specific domain or context, and so you've got to identify that context where you could really change things. Secondly, find a fantasy mentor. Now, this is, I think, is quite an interesting and perhaps original concept. I was driven to it by studying Bob Dylan, because here this guy arrived in New York, completely unknown, nineteen years old, but with fantastically high ambition. And one of the things which he did was to seek out Woody Guthrie, who was probably the template that he wanted, which was Woody Guthrie had been not only a folk singer, but

• 2:21:45Richard Koch?

  also a protester, really, and also someone who wrote his own songs. And in fact, that was very unusual at the time, and folk songs were meant to be sort of, they rose from the folk, not from individuals. And Guthrie actually changed that. He wrote a lot of original songs, and Dylan did too. He started writing his own songs, one of which was called The Ode to Woody. And he went to the hospital in New Jersey where Woody Guthrie was suffering from a terrible, terrible disease called Huntington's Syndrome. And whether or not...

• 2:22:20Richard Koch?

  Guthrie was really aware that Dylan was there. Whether he actually thought Dylan was going to be the new Woody Guthrie is really unclear. But it's curiously irrelevant as well because Bob Dylan took from that template. That's what he had to do. He had to write his own original songs. He had to claim the heritage of Guthrie as something which would perhaps get him some publicity and attention. And somehow he managed to get a contract with the... All of the folk labels rejected him, but Columbia Records, which was a blue chip, you know, firm, obviously, signed him. And then, you know, that gave him confidence and it gave him contacts and it gave him gigs and goodness knows what else. And he was able to produce albums and then he was made.

• 2:23:04Richard Koch?

  And also, of course, he hijacked, in a sense, the protest movement with songs like "Blowing in the Wind", etc., which made him, according to certain people, the voice of the generation. So it's another way to find a fantasy mentor. Thirdly, to search for transforming experiences, and I'll say something about that in a minute. And fourthly, to attract well-deserved praise, and I'll say something about one breakthrough achievement also in a moment. And then narrow your focus until your work is unique. Some of those are landmarks as well. So the first one being self-belief. The second one is Olympian expectations, that you expect a huge amount from yourself

• 2:23:48Richard Koch?

  and then from other people. And the high priest of high expectations is probably Jeff Bezos, who's always banging on about this. And, you know, really believes everyone in his senior management team has to be an absolute A player, class A player. And he says, you know, if you put someone who's not used to high expectations on a high expectations team, they will adapt. But the reverse is also true. If you have people who are not high expectation people, then people's standards will slip. And one thing Bezos has been incredibly good at doing is having the highest possible standards. His mantra is customer service and unbeatable prices and he's totally flexible on all that.

• 2:24:30Richard Koch?

  So the second thing is Olympian expectations. The third one, which is particularly interesting because it's really original, I think. And I was thrilled to discover this in my research is transforming experiences. Every single one of these people had actually a, an experience which transformed them in the sense that they went into the experience as one sort of person and they came out as another sort of person, or as someone who is a hundred times more powerful or more effective. Every single one of them had that experience. And again, to take Bezos as an example of that. Before he founded Amazon, he was a failed investment banker at age 26 and a headhunter

• 2:25:12Richard Koch?

  decided to send him as a last resort to see a guy called David Shaw, who had founded a countercultural, quantitative investment hedge fund. And Shaw realized before anyone else did in, by about 1992, that the internet was going to be huge and that it could be huge, not just for information and all other things, but for selling things, for retailing. So his idea was that his firm, which was called DESCO, D Shaw and Company, should develop a program for selling over the internet and then it should start a company

• 2:25:55Richard Koch?

  to do that. And he put Bezos as the project leader on that and he and Bezos got on very well, like a house on fire. They were the same extremely quantitative, extremely nerdy, extremely ambitious sort of people. And between the two of them, they developed the format for Amazon. And they decided that the first category that they would go into was books and they decided that they would allow people to write reviews on the sites, et cetera, et cetera, et cetera. It was Amazon blueprint as it happened. And of course, David Shaw wanted that to happen within DESCO.

• 2:26:36Richard Koch?

  But one day, Bezos went to David and said, I really want to do it myself. And David Shaw took him for a two hour walk around Central Park, in which he tried to dissuade him. But incredibly generously, David Shaw allowed Bezos to go off and found out, he didn't even ask for a share in the company. But then that was David Shaw. He was a very, very self competent guy and his firm has been amazingly successful anyway. So that was a transforming experience for Bezos. We talked earlier about Bill Bain. Transforming experience for him was getting hired by BCG, by Bruce Henderson, when he was the completely unqualified

• 2:27:17Richard Koch?

  guy who'd never done any business, never done a business degree, didn't understand economics or whatever. A history researcher who managed to get a job as a development officer at Vanderbilt University, where he met Bruce Henderson. And Bruce Henderson, who had a tremendous nose for talent, then decided to hire Bill Bain. And Bill Bain talked to Boston Consulting Group BCG like a duck to water, because he was a very, very smart guy. And because the power of the concepts, the concepts were so great and Bill and Bruce developed them together essentially. And then Bill decided to do the dirty on Bruce and leave and form his own firm.

• 2:27:58Richard Koch?

  We would never have heard of Bill Bain if it had not been for Bruce Henderson meeting him and deciding to hire him and the formative experience of working within BCG.

• 2:28:08Tim Ferriss?

  Let me ask you a question if I could, Richard, and I imagine you you might get to this. I'm sure you have an answer for it, but before we move ahead, if someone has not had a transforming experience, one might wonder, if they're listening to this, is it possible to engineer a transforming experience? Or do I sit on my head and wait for Lady Luck to smile upon me?

• 2:28:32Richard Koch?

  Absolutely. That's the whole point. I mean, one of the things I say in the book is that the whole point of trying to identify these nine landmarks is that the people who actually visited them didn't intend to. They didn't actually say, I need a transforming experience, let's have one. It happened to them. I mean, for example, the transforming experience of Margaret Thatcher was having the Falkland Islands invaded by General Gattieri of Argentina. And she said that was the worst moment of her life, but it was absolutely the making, as it happened, of her. And the experience of living through that and commanding the armed forces and doing what everyone said was impossible, which was recovering the islands, made it possible

• 2:29:16Richard Koch?

  for her then to do what she really wanted to do, which was, in her opinion, reverse national decline of Britain. So, yes, the people who had these transforming experiences did not engineer them, but having seen how important it is, understanding that you cannot, in my opinion, admittedly from a relatively small sample, but it's amazing that every single one of these people had a transforming experience, which is described in the book, and I did not fake it. I just, you know, I didn't throw anyone out because they hadn't had a transforming experience and I stuck to the rules. You can then say, well, I'd better have a transforming experience, haven't I? And then you come to the question, well, what is the most likely type of transforming

• 2:29:59Richard Koch?

  experience which will put me in luck's path in order to then become much more powerful? So it could be going to a particular university and studying something which is very arcane and unusual. It could be finding a very high-growth firm like BCG or Boston Consulting Group or DE Shore and Company and then joining that firm when it's still very young, because you won't be on the forefront of developing. You see, the thing about companies in their early days is that they don't know what they're doing. And so if you don't know what you're doing, you can be very creative about it. And if you're involved in that process, you discover things that you never knew that you had.

• 2:30:42Richard Koch?

  And not only that, you become identified with them and you become powerful and you become perhaps a large shareholder in the company. And it's completely different from joining a company which is on tram lines, where basically it's not going to do anything radical and anything new. It's so exciting to actually be part of a company that's growing very fast, doesn't really know what it's doing, but has got something, some rare knowledge. Which actually means that it can be very, very successful. And it doesn't have to be a company. It could be a social organization. It could be a way of thinking. It could be anything that's growing very fast. And where it's unformed and where you think you've got some affinity with it. And the ability to contribute and be creative.

• 2:31:25Richard Koch?

  It's not easy to specify what someone's transforming experience should be. But I've tried it on a few friends and good acquaintances. And it's amazing that actually we do in the end come up with something which might actually work. And some cases has.

• 2:31:41Tim Ferriss?

  Before we get to the fourth, I just want to say a few things. The first is that my experience maps very well to a few of the things that you just described in the sense that when I was graduating from college and was suffering from all sorts of quarter life crisis existential angst about what to do with my life. And I asked a mentor at the time, what I should do? What type of sector I should go into? And his answer was, it doesn't matter as long as it's growing very quickly. You want to be in something that is growing quickly, not in a sector that is in decline or stagnant. And that ended up being exceptional advice. And I've found that it also applies to where you place yourself.

• 2:32:23Tim Ferriss?

  That is to say, one of the reasons, by example, that I left San Francisco after effectively a decade was that I felt like it was a place experiencing some degree of stagnation or even in decline. And I moved to Austin, Texas, which was very much a startup of a city. It was rapidly growing, expanding, where it was still taking shape and still could be shaped. So I just wanted to reinforce what you said. And on that point, or I should say, moving on from that point, what is the fourth of the nine landmarks?

• 2:32:55Richard Koch?

  Yes, I mean, growth is, growth is everything. I mean, it ties in with the start principle. The fourth one is one breakthrough achievement. Now, this is different, Tim, from the other eight landmarks in that it is not a how to do it, it's a what to do. And in some ways, it's a bit odd of me to put it forth because it's the culmination of everything else and all the others really lead to this. But I wanted to put it in the book fairly early because I wanted people to be thinking about this as they go through, which is what on earth are you going to do to change the world? And you're not going to succeed unless it's something really dramatic, or you're not going to succeed in being unreasonably successful.

• 2:33:40Richard Koch?

  So you need to start thinking about that. It might take you a decade, it might take you several decades to actually work out what it is. But it has to be something that you believe needs to be done. It's not a way of making you successful, it's a way of changing the world. And if you define it in those terms, again, it's surprising you can actually come to some kind of resolution, some kind of opinion. And for example, once Lenin had had his transforming experience, which was the hanging of his beloved elder brother that he idolized and adored, because he was implicated in an assassination attempt at the Tsar.

• 2:34:23Richard Koch?

  When he was 16 years old, Lenin heard that his brother had been hanged. Instantly, he decided that his whole purpose in life was to smash the bourgeoisie and to cause revolution in Russia. And it was a ridiculous, you know, 16-year-old schoolboy, ridiculous idea. And he wasn't political at all before. He wasn't, he was a very nice sort of, you know, everyone liked him. But he became very bitter and twisted, but also very effective. So it's one breakthrough achievement. And it's not two, it's not three, and it's not one every five years. It's something that you do, which it actually is going to in some way change the world. I mean, my breakthrough achievement was starting or co-starting L E K.

• 2:35:07Richard Koch?

  It's not on the comparable scale with the people in the book. But nevertheless, it was, you know, a very successful firm, which gave huge opportunity to hundreds or thousands of young people really, who were trained and developed in that way. And it also made an impact on the corporate world as well. We invented the idea of mergers and acquisitions strategy consulting, which is completely different from anything that anyone else had done. So one breakthrough achievement is the fourth one. The fifth one is make your own trail, which is, you know, basically become bloody minded and work out a way of doing something that goes off path from everyone else. And I describe how to do that.

• 2:35:50Richard Koch?

  The sixth one is to find and drive your personal vehicle. Again, one of the discoveries in the book is that every one of these 20 people had some kind of vehicle, which in some ways, sometimes it was a concept. More often, it was an organization of some sort, a company, if it's in the business sphere, or an organization more broadly defined if it isn't. The British state, for example, was a vehicle for Margaret Thatcher and for Winston Churchill, together with a particularly eclectic sense of, you know, what they were trying to do. The whole point about a personal vehicle is that the paradox of the individual who actually does manage to change the world is that they can't do it on their own.

• 2:36:35Richard Koch?

  But on the other hand, it doesn't get averaged. It's not sort of a committee deciding what to do. So someone like Jeff Bezos decides to make internet retailing the thing which he does and the thing that the everything store was the name that they gave it originally. And not just to be a successful internet retailer within books, but to be a successful retailer on the internet everywhere and to be totally dominant in doing it. You know, an incredibly ambitious thing. But in order to do that, he needed to have an organization which was totally under his control, just the same way that Lenin needed to have the Bolsheviks.

• 2:37:17Richard Koch?

  You know, a group of people who were totally dedicated to Lenin, not very many of them, but a couple of thousand. And that is necessary so that you overcome the inertia that society and culture has. So that an individual can change things by being very determined about it, but they don't have to do it all themselves. And the choice of the vehicle is terribly important.

• 2:37:43Tim Ferriss?

  May I ask, just before we move on, are there any particular unusual or unorthodox examples that come to mind for both make your own trail and find and drive your personal vehicle? If you could give perhaps one for each?

• 2:37:58Richard Koch?

  Yes, I mean, your your own trail is is very much, I think, Walt Disneyland. I don't mean, I do actually mean Disneyland. The thing about Walt Disney is that he couldn't decide what he wanted to do initially. He was a very good actor when he was in high school and he used to do double acts with a friend of his, which were, you know, garnered a huge amount of praise. And then he decided that he actually wanted to be an artist, but then he narrowed that down to being a cartoonist. But his firm, which he started, his studio, which he started in, I think, nineteen twenty three in Los Angeles, was not very successful for the first few years.

• 2:38:40Richard Koch?

  The big breakthrough that they came up with was Mickey Mouse. Mickey Mouse made all the difference because they gave a ridiculous story about a a mouse who wanted to woo a lady mouse by flying a plane. It was a really silly story. But what Disney did was not only sort of this film called Playing Crazy, which he turned into a very expensive film, which almost bankrupted him and his brother and various other people. But he decided to give voices to the characters from the screen, which people had done before, but never with cartoons. So that was a sort of, you know, his personal trail.

• 2:39:19Richard Koch?

  In the nineteen forties, he became disillusioned with Disney as a corporation. It was a very successful corporation by that stage. But nevertheless, he was disillusioned with the fact that they were trying to take him away from the studio. He didn't have the sort of excitement of doing it. He didn't really feel that he was creating something new. And so he went in to find his own personal trail. He actually spent quite a bit of time with Salvador Dali and they created a a very surrealist movie, which then the board of Disney turned down.

• 2:40:00Richard Koch?

  And Walt Disney was outraged by that. And he had to tell some of them that, you know, they did not think that having the board approve it was anything other than a formality, but the board said, no, you've lost your marbles, you know, as Peters and Waterman would say later, stick to the knitting, etc. They didn't use those words, but that was the, that was what they said, that's what they meant. And so Walt Disney decided to go off and do something completely and utterly different, which was invent Disneyland. Until then, amusement parks had been the province, as Disney called them, of hard-faced men who basically were thugs.

• 2:40:42Richard Koch?

  But what he wanted to do was create something which would be a monument to the past, the present and the future of America and all that was best in America. Now, you know, the first time I ever went to Disneyland, which was in 1969, I hated it. I thought it was too American and too plastic and all the rest of it. But it was a fantastic achievement in the early 1950s and hugely successful commercially. Again, he was making his own trail. The board again refused to invest in this. They refused to put up the capital for all the exploratory work, for all the imagination that had to go into it, for building Main Street and the fire station and Abraham Lincoln and all the rest of it.

• 2:41:26Richard Koch?

  They said, no, we're not going to approve this, Walt. And Walt said, well, screw you, in effect, I will fund it myself. And so he sold his houses, he sort of, you know, took second mortgages rather on his houses. He sold one of them, took a second mortgage on the first house. He found investors who would do this. And eventually, at the last minute, the Disney Corporation decided that they would come on board as well, when they saw it was inevitable it was going to happen. They initially refused to let him use the characters, Snow White and Donald Duck and all the rest of it. They said, no, if you do that, we'll sue you.

• 2:42:06Richard Koch?

  So if Disneyland had failed, which was eminently possible, Disney would have been ruined. And indeed, the parent corporation might have been in some trouble one way or the other, but that was finding his own trail because he had this vision and he wanted to pursue it, and it was nuts, basically. So that's an example of.

• 2:42:29Richard Koch?

  Making your own trail, finding and driving your own personal vehicle. Well, I think actually Lenin is jolly good example of that. It was the Bolsheviks. You know, initially, the dissident revolutionaries in exile around about 1900, etc. Were dominated by people he later called the Mensheviks, by social revolutionists who were not as extreme and uncompromising as Lenin. And there was a conference, I think in 1903 or something like that, at which Lenin deliberately antagonized the other people and said, "I want to have my own party. I'm going to split the revolutionaries." And they said, "Don't do that.

• 2:43:13Richard Koch?

  We've got, you know, there aren't very many of us. Please don't do that." But he said, "No, I can demonstrate that if I have, you know, a thousand people who are dedicated to me and to my way of doing things, we can have revolution in Russia." Now, absurd, because there are hundreds of millions of people in the Russian Empire. And how could it be that a thousand people could actually change that and make successful revolution? But Lenin had an answer to that, and it was a very good answer, which was, he said, "Look, Russia's a very backward country. It's an autocracy. It's not like Germany or France or Britain, where, you know, there are lots and lots of different centers of power.

• 2:43:55Richard Koch?

  All of the power is concentrated in the Tsarist army and the bureaucracy. And there are only about 2,000 people in Russia who actually control things. There are no independent centers of social pluralism." I'm sure he didn't use that word, but, you know, basically, it's a very top-down state. And if 2,000 people can rule Russia...

• 2:44:22Richard Koch?

  Why not us? And that was his theory and actually proved to be absolutely correct. So his vehicle was splitting the revolutionary movement, but having a group of people who are absolutely dedicated to him and got shot if they didn't, if they weren't. So the vehicle is very, very important. The vehicle doesn't necessarily have to be very large, but it hugely augments the power of the individual. But it's not a compromise. The vehicle must be totally the vehicle in the same way that Bain and Company was Bill Bain's vehicle. You know, you stepped out of line with Bill Bain, you didn't get shot, but you certainly got fired and so on and so forth. Boston Consulting Group was Bruce Henderson's vehicle. He did it a different way. It was more let a thousand flowers bloom, but nevertheless, unless you were interested

• 2:45:07Richard Koch?

  in developing a concept, which was Bruce's thing, then you weren't going to succeed. And he got people who were very good at doing it. Can I move on to the next three? I'm sorry, I'm probably taking too much time.

• 2:45:18Tim Ferriss?

  Oh, no, that's, that's totally fine. That's why this, this conversation is long form. So let's move on to the next one.

• 2:45:24Richard Koch?

  Okay, the seventh one is thrive on setbacks. And this doesn't sound terribly original, but it is terribly important. You remember that Nicholas Nassim Taleb wrote a book called Anti-Fragile, which I think is probably his best book.

• 2:45:36Tim Ferriss?

  I do.

• 2:45:37Richard Koch?

  And the thesis behind that, as you know, is that resilience is not the point. You actually have to like setbacks. And the reason that setbacks can be very helpful is two reasons. One is they give you feedback and might tell you that you're off, you know, you're on the wrong path. And the other thing is that either you're on the wrong path or you've got the wrong tactics and it's quite important to distinguish between those two. Or that in fact, the fact that you've been unsuccessful in a big way means that you're going to be very successful in a big way. It's quite difficult to describe. I also think about Winston Churchill and his wonderful failures. He went away from those failures, obviously a bit depressed at times.

• 2:46:20Richard Koch?

  He went and did something completely different for a time, getting out of politics after he'd ruined the Gallipoli campaign, the Dardanelles campaign in 1915 and sent, you know.

• 2:46:33Richard Koch?

  Several thousand people to their deaths from a harebrained scheme that he invented. And he got out of politics for time. He joined the regular army and he went to the Western Front. In nineteen twenty nine, he was on the verge of bankruptcy as a result of having invested heavily in stocks in nineteen twenty eight. And when the crash came along, Wall Street crash, he was almost bankrupt. He decided to. And also, he was very unpopular with his fellow conservative leaders at that time because he'd made a number of mistakes. In nineteen twenty five, in going on to the gold standard for Britain and in antagonizing the miners, leading to the general strike of nineteen twenty six. And alienating the whole of the organized labour movement. So he was unpopular with his party. He was on the verge of bankruptcy.

• 2:47:17Richard Koch?

  He went off and did a huge lecture tour of America, which was very successful. And then he got run over on Fifth Avenue by a car and suffered some quite serious injuries, but battered and bruised, he gone up and did it again. And you can see from what he writes that he thinks what's happening to him is terribly important. And most people would say, no, this is a semi-comical drunk who's basically had a series of failures. But, you know, Winston Churchill didn't see it that way. Very, very interesting, the psychology of not being resilient. But actually really liking failures because they they make you seem important in some ways. And then the last two are acquiring unique intuition, which requires deep knowledge. And here I think that I overlap a little bit with Malcolm Gladwell.

• 2:48:02Richard Koch?

  You know, you really do, the quality of intuition is a function of the degree of experience that you've had in a very narrow field. But also your willingness to take notice of intuition, which some people do and some people don't. And the last of them is distort reality, which is Steve Jobs's phrase, of course, based on Star Trek. But what distort reality means is refusing to accept current reality and redefining a way of making that different. And convincing your followers in particular that you know how to get around or distort reality. Convincing them that you have a reality distortion field.

• 2:48:43Richard Koch?

  It works. It's just amazing. And Bruce Henderson did that. Bill Bain does that. All the other people in the book had got a way of overcoming. What was the incredulity of other people that they could actually really change the world in a major way?

• 2:48:56Tim Ferriss?

  I would love to make a few observations based on a number of things that you shared. And also, I'm going to follow that by asking you for an example of acquiring unique intuition, because this is of great interest to me. But I want to mention, one, a piece of trivia for people that ties into a name that came up several times, Jeff Bezos, thriving on setbacks, although he didn't come up in that particular landmark description. If you go to relentless.com, it will forward to where? To amazon.com. So relentless.com is one of the first domain names pointed to that website.

• 2:49:36Tim Ferriss?

  And what strikes me is that many of these landmarks are reinforcing for one another, right? So you have, let's just say, self-belief, Olympian expectations, and I'm going to group them in a very deliberate way. Self-belief, Olympian expectations, one breakthrough achievement, make your own trail, find and drive a personal vehicle, thrive on setbacks, and let's take distort reality, because I'm not yet familiar enough with the acquire unique intuition. But all of those, to some degree, seem to be enormously enabled when you have a longer term vision and horizon in mind than your possible competition.

• 2:50:17Tim Ferriss?

  So if you look at Jeff Bezos, right, he is one of the few examples of chief executive officers who have been given a pass by Wall Street. I mean, he's convinced his investors, if you go back and read his annual letters, which I encourage everyone to do, you can find a PDF of all past Amazon annual letters. There was always an emphasis on a long-term time horizon, longer term than a quarter, longer term than a year, always longer term. Bob Iger at Disney is another great example of this. Toby Lutke of Shopify is another incredible example of this. And it just strikes me that this longer-term vision and time horizon enables a lot of these. And without that, if you are, in any sense, feeling compelled to rush, that you disable

• 2:51:02Tim Ferriss?

  some of these landmarks. That's just something that came to mind as you were describing these.

• 2:51:07Richard Koch?

  I couldn't agree more. I mean, that's absolutely true. You need a long time horizon. You need to expect that you're going to have massive impact, but it might take a very long time. But you need to be sure about what you're trying to do, and you need to be sure that you'll get there, but you know. Time is kind of, you know, there's lots of time.

• 2:51:25Tim Ferriss?

  Yeah. So acquiring unique intuition, could you perhaps give us an example of that that you like? And if there's one outside of Steve Jobs, that'd be great, but you could use Steve Jobs if you like.

• 2:51:35Richard Koch?

  I think Jobs is a great illustration of that, but I'll take Nelson Mandela as my example on this. Nelson Mandela was a leading member of the ANC who got caught and convicted and sent off to prison. Total of, I think, 19 years in prison, a life sentence, actually. He was quite lucky to escape the noose, and we were very lucky that he did. He was on this island called Robben Island, which I visited off Cape Town. It's a short boat ride away from Cape Town, maybe half an hour at most, but it's a world away. And it's a nasty, horrible stark. It's basically, it's a scrapyard, essentially. I mean, it's

• 2:52:19Richard Koch?

  got rocks, a lot of rocks, and that's it. I visited the cell in which he'd been incarcerated, and it's so small, you wonder how he could possibly have kept his self-respect. But during that period of time, something very interesting happened. The leaders of South Africa, including P W Botha, who was reckoned to be the great crocodile, sort of, you know, very, very hostile to change, actually realized that they'd painted themselves into a corner and that they didn't want to have the possibility of bloody revolution and being driven into

• 2:52:58Richard Koch?

  the sea as they, as they saw it by the population of South Africa. And the whites were, you know, maybe 5 million people against 50 million plus who were blacks broadly defined. And the ANC were ratcheting up violence.

• 2:53:16Richard Koch?

  And the ANC were controlled by Oliver Tambo in Lusaka, some distance away. And here was this Nelson Mandela guy. And he was, when he was in prison on Robben Island, some interesting things happened. One is that he acquired the charisma of the sort of, you know, prison hero. So that within the ANC, he was viewed as the natural leader. Another interesting thing which has happened was that there were various outside forces, including the British Commonwealth, that in the 1980s, sent people to Robben Island to talk to Mandela and try and see whether, you know, there was any route forward there.

• 2:53:58Richard Koch?

  Because they couldn't speak to the guys in exile in Lusaka or wherever they were. And those guys were totally uncompromising and were trying to cause civil war. And they wouldn't have got anywhere. And so there were a group of people who went, there was a group from the Commonwealth called the eminent persons group, very self-deprecating. And these eminent people went and of course they talked to Nelson Mandela because he was, you know, he was recognised to be almost the shop steward of the prisoners. And he'd formed a sort of university there where they, you know, basically developed knowledge of this, that and the other. And somehow Nelson got the intuition that these people actually wanted a deal.

• 2:54:43Richard Koch?

  They didn't want this to be continued forever. And they were willing to compromise in some way, that the hardline nationalists who were nasty horrible racists would do apartheid and they shot people and they were extremely unpleasant, there's no doubt about it. These people actually wanted a solution and he was the first person to realise that. The ANC had always said, and Nelson Mandela had always said, we will not compromise. But when he met some of these people from the Commonwealth and when he met later some of the senior ministers from the government of the nationalist party, ruling party.

• 2:55:17Richard Koch?

  He suddenly realised that a deal was possible. And he said to them, you know, if you really want a deal, you're going to have to have one person, one vote. And they said, we couldn't possibly have that democracy. No, we don't want democracy. There are more blacks than whites. We can't possibly do that. But, you know, Nelson stuck to that. And eventually he formed personal relationships with the head of the secret service, the secret police, as it were, with the minister who was responsible for justice, with the minister who was responsible for state security, including the prisons, and eventually with P W Botha himself.

• 2:55:59Richard Koch?

  And it was all based on this intuition that perhaps they could reach a deal. And nobody else had that intuition. Nobody but Nelson Mandela actually thought it was worthwhile pursuing talks with those people. And it took five years. But in the end, his intuition won out. And the result was that instead of having a war and bloodshed going on and possible revolution, and the only question for people really was whether that would be five years or 50 years before that whites would be thrown out and massacred. Instead of that, you might have a transition to black majority rule.

• 2:56:38Richard Koch?

  And that could be done in a controlled way where F W de Klerk, who succeeded Botha, would be the vice president and effectively the mentor of Nelson Mandela. I've talked personally to F W de Klerk about these days. For some reason, I had an opportunity to do that. And, you know, he was quite clear about it. If it had not have been for Mandela, and of course, he said himself, the odds against this would be a thousand to one. It was just based on this intuition that there might be a solution where everyone else thought there wouldn't be a solution. And he would not have known that, but for being in prison on Robben Island for 17 years and meeting all these people and gradually being able to size them up, including the

• 2:57:22Richard Koch?

  heads of the prison, who were varied in quality from unpleasant to brutal. But nevertheless, he worked out the way the wind was going. And nobody else did. As I was working in South Africa at the time, and we never thought that there was a possibility of any solution. Nobody I talked to did. But Nelson Mandela had a different intuition. I described that in the book and it's very, very, it's very heartwarming. There's some horrible stories in the book, but it's very heartwarming. Intuition is hugely important.

• 2:57:52Tim Ferriss?

  Thank you for sharing that example. I think it's a wonderful place to start to wrap up this round one. We may have to, we may have to do a round two on the podcast if you have the endurance sometime.

• 2:58:03Richard Koch?

  I would love to, yeah, I would love to.

• 2:58:05Tim Ferriss?

  But Richard, I want to ensure that people know where they can find you. Of course, on Twitter, they can find you at Richard Koch 8020, Richard Koch dot net. You've written many books, including many books that have influenced me, like the 8020 Principle. You have the STAR Principle, which we've mentioned a number of times. And your newest book is Unreasonable Success and How to Achieve It. I have just one more question for you, and then certainly I'm open to any closing comments or anything else that you would like to share. If I've omitted anything, certainly, or if there's just anything in addition that you'd like to put forth. And I'll start this question with a quote as

• 2:58:47Tim Ferriss?

  prelude. And this is from an interview that I found with you, and it relates to New Year's resolutions. This is a quote, which you can, of course, feel free to correct, but this is attributed to you. "Once a year, rather than doing New Year's resolutions, I ask the same question. What did I do that meant the most to me and my family and friends, and sometimes strangers too? And what could I do in the next year? More of the same is not a bad answer, but something fresh too." So this really struck me as an impactful question. And good questions are impactful. So A, is this something that you do and

• 2:59:27Tim Ferriss?

  might recommend? And number two, are there any other questions you might suggest listeners consider or ponder, let gestate on their minds?

• 2:59:39Richard Koch?

  Yes, it is true. And I think it's right. The question I would ask is one, again, from, from the book, which is, in your whole life, what is your breakthrough achievement going to be? If you want to change the world, how do you want to change the world? And ponder that maybe on New Year's Eve, maybe any other time. There's plenty of time to work it out. But do you really want to have a major impact on the world? If you do, what? That's really my question. It's a question I ask myself as well. I mean, my own ambition is to have many more creative, completely unreasonably successful people. And the thing I'm toying with, which I don't know if you think is a good idea or not,

• 3:00:23Richard Koch?

  is offering to work with a number of people who have already been reasonably successful, but have not been unreasonably successful, and take them through the process and see whether we can generate some unreasonable success from a lot of people. And to cascade that down and train other people to do that, because I think this methodology is robust, and I think it could make a huge difference to the world. And I'd like to see whether I can demonstrate that in practice through a few pilot studies. So that's my personal ambition.

• 3:00:55Tim Ferriss?

  I love that. I think you should definitely test it, and it could be a spectacular failure or spectacular success, but nothing ventured, nothing gained. And you do like to bet, so I figure this is one good opportunity to do that. And having some experience with vetting, I'm not volunteering myself, but I would say run a competition or have applications that are vetted and can be vetted in some very simple ways that you're not overwhelmed, and pick a handful of finalists to take through that process. And what I'll suggest, just as a placeholder, is that people follow you on Twitter, Richard Koch 80208020. And if you decide to do this, you can share that on Twitter, and that can be at least

• 3:01:39Tim Ferriss?

  a possible starting point so that people are alert that this is a possibility. And what a pleasure it's been, Richard. I feel like I know you in the same way that perhaps some people I meet who listen to the podcast feel like they know me, but it's been through your written words that I have come to admire and use, quite frankly, with great effect, much of your thinking. So I thank you very much for taking the time today. This has been an incredible, incredible pleasure, and I hope it's not the last.

• 3:02:13Richard Koch?

  Indeed. Tim, thank you very much indeed. I reciprocate. Much more pleasure for me, I'm sure. It really is great. Anyway, thank you very much indeed, and I look forward to talking to you again at some stage, maybe, maybe a bit more frequently. That'd be wonderful.

• 3:02:30Tim Ferriss?

  Well, the feeling is definitely mutual. And to those listening, I will have show notes for everything we've discussed, including all of the books, all of the resources, including the most recent work from Richard, which is Unreasonable Success and How to Achieve It at tim.blog/podcast. You'll have links to all the names, everything you can imagine. So please do check that out if you'd like to indulge in more exploration. And until next time, as always, thank you for tuning in. Hey, guys. This is Tim again. Just one more thing before you take off, and that is Five Bullet Friday. Would you enjoy getting a short email from me every Friday that provides

• 3:03:11Tim Ferriss?

  a little fun before the weekend? Between one and a half and two million people subscribe to my free newsletter, my super short newsletter called Five Bullet Friday. Easy to sign up, easy to cancel. It is basically a half page that I send out every Friday to share the coolest things I've found or discovered, or have started exploring over that week. It's kind of like my diary of cool things. It often includes articles I'm reading, books I'm reading, albums, perhaps, gadgets, gizmos, all sorts of tech tricks and so on that get sent to me by my friends, including a lot of podcast guests. And these strange esoteric things end up in my field, and then I test them, and then I share them with you. So

• 3:03:52Tim Ferriss?

  if that sounds fun, again, it's very short, a little tiny bite of goodness before you head off for the weekend, something to think about. If you'd like to try it out, just go to tim.blog/friday, type that into your browser, tim.blog/friday, drop in your email, and you'll get the very next one. Thanks for listening. This episode is brought to you by Eight Sleep. I have been using Eight Sleep Pod cover for years now. Why? Well, by simply adding it to your existing mattress on top, like a fitted sheet, you can automatically cool down or warm up each side of your bed. Eight Sleep recently launched their newest generation of the pod, and I'm excited to test it out, Pod 4 Ultra. It cools, it heats, and now it elevates automatically. More on that in

• 3:04:36Tim Ferriss?

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• 3:05:18Tim Ferriss?

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• 3:06:03Tim Ferriss?

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• 3:06:48Tim Ferriss?

  reviews and meta-analysis. Pointing to improvements in short-term memory and performance under stress. So those are some of the products that I've been using very consistently. And to give you an idea, I'm packing right now for an international trip. I tend to be very minimalist and I'm taking these with me nonetheless. Now back to the bigger picture. Olympians, Tour de France winners, Tour de France winners. The US military and more than 175 college and professional sports teams rely on Momentous and their products. Momentus also partners with some of the best minds in human performance to bring world-class products to market, including a few you will recognize from this podcast, like Dr. Andrew Huberman and Dr. Kelly Starrett. They also work with Dr.

• 3:07:29Tim Ferriss?

  Stacy Sims, who assists Momentous in developing products specifically for women. Their products contain high-quality ingredients that are third-party tested, which in this case means informed and/or NSF certified, so you can trust that what is on the label is in the bottle and nothing else. And trust me, as someone who knows the sports nutrition and supplement world very well, that is a differentiator that you want in anything that you consume in this entire sector. So, good news. For my non-US listeners, more good news, not to worry. Momentus ships internationally, so you have the same access that I do. So check it out. Visit livemomentous.com/tim and use code TIM at checkout for 20% off. That's livemomentus, L-I-V-E-M-O-M-E-N-T-O-U-S dot com slash TIM and code TIM for 20% off.