Barry Diller: Building IAC

My guest this week is Barry Diller, one of America's most successful businessmen. At 83, he chose to publish a deeply personal book and open up about his successes and failures. With surprising candor he details the rules he's lived by: trust first, confront directly, and make the call when the clock starts. In our conversation, he shares why success teaches you nothing, why failure is essential, and why instinct still beats algorithms in a data-obsessed world. This episode is filled with Hollywood lore and business acumen. ----- About Barry: He is the Chairman and Senior Executive of IAC, and is best known for founding the Fox Broadcasting Company with Rupert Murdoch and leading Paramount Pictures. Over his career, he has reshaped television, film, and online media. ----- Approximate Timestamps: (00:00) Intro (01:48) Vulnerability and Writing 'Who Knew' (05:20) Lack Of Confidence & Fake It Until You Make It (17:58) Changes In The Entertainment Industry (22:35) Instinct Vs Data (27:17) AI's Impact on the Entertainment and Travel Industry (42:35) One Dumb Step At A Time (52:39) Accountability During Conflict (55:06) Public Broadcasting Regulation And Fair Reporting (58:04) What Is Success For You ----- Basecamp: Stop struggling, start making progress. Get somewhere with Basecamp. Sign up free at http://basecamp.com/knowledgeproject reMarkable: Get your paper tablet at https://www.reMarkable.com today .tech domains: Nothing says tech like being on .tech https://get.tech/ MINT MOBILE: If you’re still overpaying for wireless, it’s time to say yes to saying no. At Mint Mobile, their favorite word is no: no contracts, no monthly bills, no overages, no hidden fees, no B. S. Go to mintmobile.com/knowledgeproject ----- Upgrade: Get a hand edited transcripts and ad free experiences along with my thoughts and reflections at the end of every conversation. Learn more @ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠fs.blog/membership⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ------ Newsletter: The Brain Food newsletter delivers actionable insights and thoughtful ideas every Sunday. It takes 5 minutes to read, and it’s completely free. Learn more and sign up at ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠fs.blog/newsletter⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ------ Follow Shane Parrish X ⁠⁠⁠⁠⁠@ShaneAParrish⁠⁠⁠⁠⁠ Insta ⁠@farnamstreet⁠ LinkedIn ⁠Shane Parrish Learn more about your ad choices. Visit megaphone.fm/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Speaker 00

  Success teaches you nothing, but failure sure teaches you a lot.

• 0:04Shane Parrish?

  You've worked with some of the biggest egos in Hollywood and some of the most ruthless tycoons. I'm wondering if you can spend a few minutes on the lessons you've learned about ego and power.

• 0:17Speaker 02

  Barry Diller is a legendary media mogul, businessman, and investor. He is the chairman and senior executive of IAC and is best known for co-founding the Fox Broadcasting Company with Rupert Murdoch and leading Paramount Pictures. Over his career, he has reshaped television, film, and online media. He remains one of the most influential figures in business and entertainment today.

• 0:38Speaker 00

  We're certainly at the brink of the next revolution. If you were sitting in 1995 or 2000, at the beginning of the things you did not know, and there were plenty of those. There was nothing that cracked your mind and astounded you and said, oh, my God, this is beyond me. This is magic. Google, over the years, was consistently, as its monopoly grew, was squeezing the people who kind of lived as a surf on its land. But when I found an asset that couldn't be disintermediated by search, I thought, wow, that wasn't AI. That was just the characteristics of the internet environment.

• 1:22Speaker 00

  The only thing that will save us is our brands and whether our brands and the content we make resonates enough directly for people to recognize their brand and want to be brand-involved rather than agnostic. I believe until the last breath that.

• 1:48Shane Parrish?

  At 83, you chose to reveal some of the most private parts of your life, and you're a super private person. Why now?

• 1:55Speaker 00

  I can't do the why now. It wasn't like I chose this date or that date. It's that. I had thought that my life was a good story. And if I could tell it true, then I wanted to try and do it. So it took me an endless amount of time, basically because I put it away for a year and come back to it and put it away for six months and then come back to it. It was only really in the last couple of years that I was, I wouldn't call it dedicated, but that I had more discipline. I never was sure I would publish it. And then I got to a point where I said, you know, I've done it. I've kind of told it. I got it down, so let it go. My friends told me, publish it after you're gone, after you die.

• 2:39Speaker 00

  And I thought, well, I ain't gonna have anything to do with that. So I'd rather have agency of my own.

• 2:44Shane Parrish?

  How does it feel to release it out loud into the world?

• 2:48Speaker 00

  It feels exposing. Now, it's now been like, I think, three weeks or so. So I've gotten a bit used to it. But in the first days, I thought, oh, my God, what the hell have I done here? I think the first day or the second day, I did a, I think it was a live interview on CBS Sunday Morning. And I know it wasn't live, it was taped, but it was, it went out like right away. And, and I thought, and I'm being asked all these very personal questions. And I thought, you know, do I throw down this little microphone and stalk out? What do I do? And I thought, you know what? I've done it. So just go answer the questions and get on with it. And kind of once I did that, I relaxed in it a bit.

• 3:30Speaker 00

  Now, I'm kind of used to the exposure, but yeah, I wrote a personal book.

• 3:36Shane Parrish?

  One of the stories that really stood out for me was as a child, you gave up on your mother while you were at sleepaway camp and you were sitting waiting for her to pick you up. That seemed to be such a defining moment for you. And it led to this craving of independence and non-reliance on other people. Can you talk to me a little bit about that?

• 3:56Speaker 00

  Yeah, I don't think it was a craving. It was a necessity. I knew at that moment, and it was a stark flash, you know, those snapshots you have that you capture and they're always with you the rest of your life. And I have that snapshot of me in that moment. And I thought, I'm the only one to protect me, so I have no choice. That's. That's what I felt.

• 4:19Shane Parrish?

  How old were you? Can you recount this story?

• 4:22Speaker 00

  I was eight and I went to camp and I was not very happy there. I mean, a lot of children go to camp and have this, but mine was kind of acute. And my mother promised she would come and she didn't. This was not horrendous child neglect or anything of that sort. My parents were perfectly nice. They just were clueless about children. They really, they'd never been parented. Their parents had never been parented. And so they had no vocabulary for it. And so she wasn't really there to protect me and that scared me.

• 4:58Shane Parrish?

  I can relate to that a lot. And then you, you sort of had to develop your own independence from that moment on.

• 5:04Speaker 00

  I had no choice and I think it's in biology. My biology is very strong and my biology saved me. I had to be independent and so I was. I don't claim it as, you know, some, something to be prideful about. It just, uh, I'm, I, I was lucky.

• 5:20Shane Parrish?

  One of the ideas that stood out in your book as well was fake it until you make it. And how that was crucial to your success. You've had these moments in your career where you sort of believed in yourself almost despite the, any tangible evidence to indicate that you could do something. And one of the first moments was at ABC and convincing Mr. Goldenson to let you create original programming for TV. I'd love for you to explore this idea, especially considering I, I've also heard you in interviews say that you never had any confidence.

• 5:52Speaker 00

  I never had a sense of self because I didn't think I deserved a sense of self. And so I never could claim that. I never thought of that. And I, and I didn't have the kind of early buoyant confidence that, that I saw around me and that has always attracted me. I'm always attracted to people who are natively confident. I don't know how the hell. The stars or their biology or their environment put that together for them. And I see people walking down the street and I can see their confidence. And I like think, oh, my God, I wish I had ever had that. But then if I'd had that, I'd probably end up being a shoe clerk at Macy's. So I think that that lack of a sense of self, oddly, it enabled me

• 6:37Speaker 00

  in the earliest part of my career, to please others to such an extent that it got me going. And once I got going, I just kept going. And I think that that, in a sense, lack of confidence, a lack of sense of self, wanted propelled me to count as much as I could in the eyes of others.

• 7:00Shane Parrish?

  You said that you were sort of an unambitious teen. What changed? Was there a defining moment where you sort of like?

• 7:05Speaker 00

  I had no ambition. My family didn't think much, but they, whatever they thought, somewhat unexpressed, but coming out from them as an environment. My family had resources. And so I think they thought, well, they'd be supporting me. I never really have a job. I didn't want to go to school. I didn't want to go to college. I didn't want to do much of anything. I was hibernating for a good long time. But I'd always had this interest in the entertainment, in the world of entertainment. I grew up around it. Most of my friends' parents were in the entertainment business in one form or the other. And so I, I was just pulled by it. It was a tractor beam that always drove me and or intrigued me.

• 7:49Speaker 00

  And when I finally thought, you know, I really, I'm 19. I don't want to go to school, but I gotta do something. I mean, I was basically staying up nights and sleeping most days. And I thought, well, you know, I would like to learn about the entertainment business. And I thought, there are these talent agencies, William Morris, the probably at that time, the most famous number one agency. And they had a mailroom where they, so to speak, trained people to be agents. I didn't want to be an agent. I thought I'd never be an agent. That was ridiculous. Talk about if you don't have a sense of self, how can you represent others? How can you ever have the confidence to go sell somebody? You're gonna take care of their lives.

• 8:33Speaker 00

  But I thought I could go and learn. And I essentially went there. And at that time, there were big file rooms, paper file rooms. And I read the entire file room. And they had had the history of the entertainment business for 70 years. And so what incredible luck for someone who wanted to learn stuff. And I did, I was insatiable about learning. And that

• 9:01Speaker 00

  literally from one day to the next, lit a fire of ambition and purposefulness.

• 9:10Shane Parrish?

  I love the idea of sort of dark hours and sort of hours, learning and preparing that other people could do, but didn't do. And you sort of alluded to the fact that nobody wanted that job downstairs in the room. It was just you.

• 9:24Speaker 00

  Yep. I was really lucky because all the people who were in the mailroom, they just wanted to get to be agents. Since I didn't want to be an agent, I took the job no one else wanted. They all wanted to go in that horrible word network around, meet people, press people, do whatever. I went to the dungeon and, and had this job that allowed me basically almost the entire day to read. And that's what I did for three years until I think they were on the verge of throwing me out.

• 9:57Shane Parrish?

  You said you never had a goal and that, that's sort of what allowed you to do that. They all wanted to be agents, so they were working towards that. Can you go a little bit deeper on that?

• 10:05Speaker 00

  Look, if you want to be a doctor, yes, that's a goal. And you've got to go do step, step, step, step to get there. There are roles like that. But if you have a specific craft or something, you can name that craft as a goal and train for it or do whatever you have to do for it. I've never had any goals. I had the goal that I wanted to count and I had the goal that I was fascinated by the entertainment business. I don't like it when people come in to the early stages of a broad, general entertainment career and say, I want to run a studio or things like that. I think whatever your interest is, you just get on a broad path.

• 10:47Speaker 00

  Whatever door you gotta bang to get in there, you get on the broad path and everything else takes care of itself. You don't have to say, I want to be this or I want to be that. And I've always mistrusted that.

• 10:58Shane Parrish?

  I was thinking about this as I was reading that in your book and the thing that came to me was sort of, people look at jobs as stepping stones.

• 11:06Speaker 00

  Yeah.

• 11:06Shane Parrish?

  Sort of, you know, this is temporary until I get the job I want. I want to be an agent's assistant until I'm the agent. But then they're never fully present in the job. They're never just.

• 11:15Speaker 00

  Yeah. I mean, listen, maybe it might work for some, I guess. My observation is it doesn't really work. What works is if you get lucky enough to get a position that you don't have experience for, that you haven't mastered, and then you just go about doing it. The sparks you set off naturally impress others and lead. They, they drag you to the next step. You don't have to do much of anything. And, and I think when you do too many things, you know, you see people whose naked ambition is so structured. And so people who say, well, I need to go out and network. And I hear that.

• 11:58Speaker 00

  And I think, oh, you fools. I mean, what are you talking about? You don't really need to do that. It's this kind of pro forma thinking of the things you should do, the steps you should take. It really is far more naturalistic than that.

• 12:12Shane Parrish?

  Do you remember the first person who had expectations of you?

• 12:16Speaker 00

  Yes. At one point, one of the things of progress in, in that mailroom environment is you work on an agent's desk as his assistant secretary at that time, but assistant. I was very lucky that the person, my second time I did it was for someone who did take an interest in me and was kind of the first person where I could see. You know, I know what I'm doing for him and I know how effective I am for him. By the way, it's not like he ever said it to me particularly, but I could feel it and know it. And that he had confidence in me gave me the imagery of confidence in myself.

• 13:00Speaker 00

  And that was probably the first time.

• 13:03Shane Parrish?

  So he believed in you more than you believed in yourself?

• 13:06Speaker 00

  Well, I had no belief in myself. So, I mean, and I'm not exaggerating this just for whatever, for drama purposes, but I didn't have any belief in myself. But I don't even know if I now have much belief in myself. I know how absurd that probably is to say, but it's, but I can only reflect on my own dim inner rings. I think that there's no doubt that his confidence in me spurred me on for sure. I know that ever made me feel confident, but it sure spurred me on. I just wanted to please him more and I did. I was the best little assistant the world had ever created.

• 13:42Shane Parrish?

  You've worked with some of the biggest egos in Hollywood and some of the most ruthless tycoons. I'm wondering if you can spend a few minutes on the lessons you've learned about ego and power.

• 13:55Speaker 00

  I'm direct and I'm sincere and often quite blunt. That, in a way, does make people maybe trust you. I'm generally very trusting. I don't start out untrusting. I start out trusting. And you have to do a lot to break that trust. So I think that that ability to initially trust and people realize that I am trusting them. And I, I don't say, oh, this is a very precious thing. Please don't screw this up. Of course, I've been in situations where it's been misplaced, to say the least. You can't be in business as long as I have to not have your trust broken a lot of times.

• 14:38Speaker 00

  The great thing is I can't really remember and I don't have any vengeance. And that's again, just luck. It's not, it's not something I would take pride in. The one great thing about the entertainment business has been in many ways, demonstrations of various excessive personality in order to get something done or to be distinguishable from the next person. Excessiveness is not a bad quality. And also, if you're trying to convince people of things, you've probably gotta have either forceful personality, forceful something.

• 15:13Speaker 00

  That's just whether you got it or you don't got it. And today, there is less of it than there was when I was kind of growing up in it, where there was this outsized personalities that, if you're interested in entertainment, this is, we've read about for a hundred years, that kind of created the business, the motion picture business in particular. It's now a completely different dynamic, but those outsized personalities were thrilling to be around.

• 15:44Shane Parrish?

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• 17:54Shane Parrish?

  Taxes and fees extra. See mintmobile.com for details. What's changed, do you think?

• 17:59Speaker 00

  Well, I think the most dramatic change is that the entertainment business, let's say the motion picture business, was kind of encased in its own world during its greatest years of development. That was what these companies did. They just made movies, the great movies of the 30s, 40s, 50s, 60s, 70s, 80s, and some in the 90s. And there's still some good movies made, I'm not saying that. But they were worlds unto themselves. They were important worlds because those movies were exported to the world and became the export of American culture to the world.

• 18:41Speaker 00

  And movies is probably the most extraordinary movement dominating almost every country in the world from the inception of the motion picture business. And as time went on, they started doing television. And then they own cable networks and television networks, et cetera. And as they diversified, movies notch kind of somewhat down the ladder of importance to these places. I think that has an effect on the work itself. When the senior-most person wakes up every morning and worries about what's going to happen with the movie they're making and how it's doing and all of that, the care and feeding of it.

• 19:25Speaker 00

  Is far different than it being number eighty seven in the priorities of a large conglomerated company. But the most profound took place with streaming when technology essentially overtook the entire ecosystem of the manufacture of television and movies. And so where these pure entertainment companies, by the way, to some degree, it's the furthest you could ever go to say the difference between instinct and ones and zeros or technology,

• 20:05Speaker 00

  which is, as we know, quite fact based and numerical as to making any content is instinctive. And those tech companies essentially have now taken over the old hegemony of, quote, Hollywood. And now Netflix and Apple and Amazon. I mean, just take one part of it, if you want to know the distinction, where if you make content, the test of it is how many people watch it, want it, go to a movie theater, buy a ticket, do whatever. So you're in direct relationship to the reaction to that thing that you made.

• 20:46Speaker 00

  If you're Amazon and your main business is subscriptions in Prime and you offer content as kind of the thing in the front of the store to get people to come in, you're so far away. It's a different business model. It's no longer based upon, oh, I love that program, I love that movie, I pay my money, I react to it, and the reaction is to the people who made it. In this case, that's not the business model. So it's, it's a completely different environment than it, than it was. Now, I'm not saying it can't produce good things. Good things do get produced and they will continue to be, but the environment and the

• 21:30Speaker 00

  process is different. And I think probably just pound for pound, well, I can say this about it, because I can't.

• 21:40Speaker 00

  Yes, I can, but it's boring to say, God, it was so much better eight years, 10 years, 20, 30 years ago in terms of making stuff. It used to be for sure, up until recently, it was fun. You had fun doing it. You, you did it. You set up your tent. Uh, every couple of month or month or two, you'd have a movie come out and you all run towards figuring out how to make it, make it work, et cetera, et cetera. And then your next excitement was the next movie and you'd lived in that environment. And if the movie was good, it lasted for a while. Things now go so quickly. So it is not a process today where most people in it will say they're having a good time.

• 22:24Speaker 00

  It's just so fractionated now that, that, and it goes so quickly that the great thrills of making great programs is kind of gone.

• 22:36Shane Parrish?

  Do you think it's too numbers driven? I mean, you mentioned instinct as a deciding factor. You used to decide on instinct and, you know, other people would bring numbers. And I think one of your quotes, if I remember correctly, was numbers can tell you what has happened in the past, but they won't tell you what's happened in the future. But everything is sort of analytical these days. Netflix can see the exact moment somebody stopped watching a show. So when they're doing programming, they think about this. And do you think it's getting too formulaic and too data driven or?

• 23:05Speaker 00

  Well, I, I don't think algorithms can help here. None of us know what's going to happen with the dreaded wonderful word AI. But I don't think that, that predictive research is, uh, certainly in the arena of content worthless. It cannot tell you anything of real value in making a forward decision. It's just not possible. And yet, everybody wants it to be possible. Why? Because making instinctive decisions is living with great insecurity.

• 23:47Speaker 00

  There's no way to be secure, uh, when you're making decisions based on instinct. If I can get more comfort by using this piece of data or that piece of data to quote, "help me." Lovely, but it's a delusion.

• 24:05Shane Parrish?

  It's almost like hiding, you know, the safety in the numbers. I wasn't wrong, the numbers were wrong. And you can absolve yourself from responsibility in a way.

• 24:12Speaker 00

  You can only do that for so long because in the end,

• 24:19Speaker 00

  your work will get you, good or bad. And there's nothing you could, you can't hide. That's the, the thing that I will always love about that world is you're, you're out there with whatever you've made, you've put together, whatever role you played in it. And there's no hiding. It's there for people to see and react to, and they will react.

• 24:46Shane Parrish?

  Is there any particular failure that stands out in your mind as like, oh, I, I've learned a lot from that one? Or it was more impactful than the other ones?

• 24:54Speaker 00

  If you are in the work of making things content, you're going to have a good amount of failure. It's not possible otherwise. Now, I've, I've been lucky. I won't say it's luck. It is, that isn't luck. But I've had enough successes to balance the failures and probably have, have had a better average, let's call it, of that. But every failure in some way ought to teach you something. And success teaches you nothing, but failure sure teaches you a lot.

• 25:30Shane Parrish?

  Are there lessons that you've sort of been taught multiple times from failure? That you're sort of like, I keep running into that, but it's a different version of the same problem.

• 25:39Speaker 00

  The most important thing, and the thing that I have been reminded of continuously, is to keep scrubbing my instincts clean, as it were. Every time I've made a decision out of cynicism, I wouldn't say every time because sometimes probably it has worked. But there's a continual theme of cynical decision-making that is poor. So being naive, not being cynical.

• 26:04Speaker 00

  Being able to not let life experience, so to speak, infect your basic instinct, your ability to know a good idea from a bad idea. That has been, if anything, the thing that constantly I've had to work at. Because as you gain experience, the natural tendency is to be cynical or is to be sophisticated, is to know things. And it's something that I've just learned to fight against, not always successfully.

• 26:37Shane Parrish?

  How do you maintain that beginner's mindset, though? Like, what are the things that you do to approach things that way?

• 26:43Speaker 00

  I wish I could give you a prescription for this. I think probably the best way I can say it is hold on to naivety. Do not let the fact that you are, of course, learning things. And learning is, of course, how could you say it's anything but good? But living in an environment where the corrosiveness of the day grinds at you and makes you worriedly cynical and all of that is just something you gotta fight against it. That's the best prescription, but that's all I got.

• 27:17Shane Parrish?

  You mentioned AI. I want to come back to that in a second. You've lived through major technological disruptions from cable to TV to home video to theaters becoming less important. And now we have the internet and we have AI here. I'm wondering if you can spend a few beats on AI and tell me about how you see that not only impacting the media and film business, but also maybe double click on how you think it's going to impact the website and travel and all of these other things that you're involved in.

• 27:48Speaker 00

  Off the content business into the worlds that I've been in for the last 25 or so years, which is the world of internet tech life with Expedia and dozens and dozens of other websites, commerce sites, et cetera. And I was very lucky. I got to participate in that revolution, which started really around 95 when the internet started to get used by ordinary folk. And I was there in that period and able to have this wonderful field kind of open there just for the, so to speak, grabbing and learning. And that was. Definitely a radical transformation.

• 28:29Speaker 00

  We're certainly at the brink of the next revolution. If you were sitting in nineteen ninety five or two thousand, at the beginning of the things you did not know, and there were plenty of those. There was nothing that cracked your mind and astounded you and said, oh, my God, this is beyond me. This is magic. You could master it. It wasn't hard to master. AI, will it master us? Certainly, in some cases, it probably will. The first time I used ChatGPT, which was before it was released, and I thought, well, this is friggin' magic. And we're past that very early stage.

• 29:14Speaker 00

  We're into the great unknown here. It's going to have profound effect. I don't know to what exact extent. I know that for my businesses, we are racing, and we've been doing this for years. And anyone in business has been using machine learning for a decade or more. We're so far past that now in so many different areas that I can't by any stretch tell you the extent of these changes, except I know they're profound. How do you think it's going to impact the travel business? Well, it's already impacted the travel business. You are able now, I mean, Expedia, which is a large entity, I mean,

• 29:56Speaker 00

  one hundred and fifteen or twenty billion dollars of sales. It's a large enterprise and it is a tech company. The things we are using AI to do now, which did not exist, is profound in every area of our service. It is more than likely that within a year, and I don't say that, and I think it really is probably truly within a year or so, you really will be able to have a conversation.

• 30:31Speaker 00

  Agentic, this new word, where an agent does work for you, will know so much about you. It's not like they will have known that your calendar says you have to be in Las Vegas on Thursday, the 20th of September, and will just take care of everything for you. Eventually, that may happen, but the dialogue that you will have very soon, where the agent will know so much and have such agency with the ability to actually complete a transaction in all its respects is not far off. That's, that's an extraordinary change.

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• 32:00Shane Parrish?

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• 32:44Shane Parrish?

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• 33:07Shane Parrish?

  It sounds like there's opportunities for you from travel planning, knowing your customer, and there's a lot there, but there's also this sort of disintermediary threat, I would imagine, where people are purchasing their travel or planning their travel in a completely different way that doesn't involve something like Expedia. How do you think about that?

• 33:27Speaker 00

  They will unless we plan it better than the next dope or a competitor of ours. We have more information now than anybody else has. So if we screw that up, it's on us, as they say, and we deserve to fail. But presumably, if we are satisfying the consumer because of the data that we have, which is deep and vast, then I think they'll continue to engage us. They'll continue to want us to do that for them. I think from what I know now, it is not easy today for anyone else to do that,

• 34:08Speaker 00

  other than our competitors can do that today. But it's not easy for any large language model or any model that I know of. So it's up to us to do it. It's always, listen, we're the largest publisher. This is another business of ours called Dattash Merida, where we're with People Magazine, Better Homes and Gardens, Travel Leisure, et cetera, 60 some odd magazines that we publish digitally and also hugely still in print. Obviously, that is a business that's supported by advertising. And with the changes in search that could disintermediate those advertising opportunities, the only thing that will save

• 34:53Speaker 00

  us is our brands and whether our brands and what the content we make resonates enough directly for people to recognize their brand and want to be brand involved rather than agnostic. I believe

• 35:09Speaker 00

  Until the last breath, that brand value is enduring. But it's got to be differentiated. It's got to be clearly differentiated. And it's got to be of its own unique value. If it is, I don't worry so much. One way or the other, it'll get, it'll, it'll, it'll get recognized.

• 35:29Shane Parrish?

  What opportunities do you see in new business lines that maybe you could acquire? Or data sets or anything on the horizon where you're like, oh, we can take advantage of AI wave by doing something different versus a legacy business?

• 35:43Speaker 00

  Our company owns a large interest in MGM Resorts, which has nine resorts in Las Vegas. There's no way to disintermediate the experience. I mean, again, if we're in a simulation, we can go into that route, but there's no way as humans. You can find an experience that's going to divert you from all the entertainment offerings that a Las Vegas has to offer. It's impervious to AI or to anything other than whether or not you got something that's pleasurable for a family and exciting for people to come and see concerts and

• 36:25Speaker 00

  all of the things that take place at the kind of scale that takes place in Las Vegas. What impressed me about that in the very beginning was I said, nobody's ever going to make another one of those. No matter how much anyone tries, Las Vegas is on its own. It's not necessarily for everybody, but no one is going to recreate the, the infrastructure that exists in that particular place. That's unique and of, I think, enduring value. And I'm fascinated by it because I just think it is again, an example of a place where you can make something up today and it comes out tomorrow, meaning there's nothing that stands in your way.

• 37:10Speaker 00

  We just created a beach club with Cairo at one of our properties that is just, it's just original. And anything you can think of, there's nothing to stand in your way of making it up there.

• 37:22Shane Parrish?

  When did you get involved with MGM?

• 37:24Speaker 00

  It was during latter stage COVID. Now MGM was out of business, just like for a long time, Expedia was out of business. I mean, nobody could travel, nobody could go, nobody with the entire city was shut down. But I looked at it and I thought, just like I thought about travel, if there's life, there's travel. Well, if there's life, and there's gonna be life, there's gonna be Las Vegas. And so MGM, its value had decreased enormously. So we were able to purchase a large percentage of it inexpensively at the time. Because we believed that once you reopened, it would be fine. And we picked, I think, the best entity to do it.

• 38:08Speaker 00

  All the entities suffered the same situation. But that's what intrigued me. And and its infrastructure, the fact that it had four hundred and eighty restaurants in one place, a hundred and twenty-five performance venues, nine million, I think it's nine million feet of convention. I mean, it just was, once we learned about it, it was so vast and deep. I said, how do you, you know, how do you not do this? That's one of the things that motivated us.

• 38:43Shane Parrish?

  Were you thinking about that through a lens of AI at the time?

• 38:46Speaker 00

  Well, to a, to a degree, for sure. The internet world, I think that everybody participated in, up until, still true to some degree today, was so dominated by Google. Google, absolute monopoly on search and all your traffic. I mean, at least half your traffic, if you were healthy, would come from people coming directly to you. But the other half, without which you wouldn't be able to survive, came from Google. And Google, over the years, was consistently, as its monopoly grew, was squeezing the people who kind of lived on it as a surf on its land.

• 39:31Speaker 00

  And so I was always, I mean, we were fighting that good fight for twenty-plus years and succeeding and building some considerable assets.

• 39:46Speaker 00

  But when I found an asset that couldn't be disintermediated by search, I thought, wow, that wasn't AI. That was just the characteristics of the internet environment.

• 39:57Shane Parrish?

  I want to come back to the fact that you said sort of you were direct and blunt as to of your, your sort of things that define you in a way. And most people shy away from confrontation and you love it. Can you tell me more about that?

• 40:11Speaker 00

  I'm not really very good on my very own staring at a wall or at a screen or at something. I need the convulsive arguing of ideas of people who have passion. And that's often got a lot of voices and a lot of voices saying, okay, it's okay. But a lot of voices saying that's stupid or whatever opinion, trying to listen for what rings your instinct is a process that I think is best conducted in extreme, at least for me. And those that like being around me and doing it and some do.

• 40:56Speaker 00

  I love confrontation because in confrontation outcomes, stuff that if you're listening, no matter how noisy that confrontation gets, if your ear is open, you're listening and you'll hear something and the thing you hear will be a better truth, at least for me, than in any other process. So I do love it and I've always prized it. And if I'm not in an environment where it's happening, I think it's kind of dull outside, inside or wherever.

• 41:32Shane Parrish?

  Why do you think people aren't always direct? Like, where does that come from? Where does your directness come from? Was that a learned thing or were you always direct?

• 41:40Speaker 00

  No, I always was. I don't know why. My interior thinking, like many things with me is, I think it's a biological. I can't, I can't do it any other way. It's not like I made a choice. It's like I said, oh, let's do that because it's better than not doing that. So then in endless situations where I see people run from confrontation. And I, of course, can't do anything. Of course, I tolerate it, but I tend to kind of run from it. It just makes me uncomfortable. And I understand better those that are.

• 42:15Speaker 00

  Incapable of it or worried about it. Then I do me that's very capable of it. I mean, I certainly understand why you would be. Uh, it, it, it's combative. It is irritating. It is often frustrating. It is a lot of things. I value those things. Other people hate it.

• 42:35Shane Parrish?

  You have a passage in your book that I, I loved. It's great self-talk and I'm going to read it because I want to quote it. You said, like, almost everything in my life. Iteration, one dumb step in front of the other. Course correcting as you go is the only process I'm any good at.

• 42:52Speaker 00

  It's true.

• 42:52Shane Parrish?

  And this process became your mantra. Can you unpack this for me a bit?

• 42:56Speaker 00

  I learn from bouncing off the walls uh, of a bad direction or a mistake or whatever. And course correcting and make less mistakes. Look, there are some people for sure, relatively few. But there are certainly people who don't need to bother with that because they are brilliant in ways I'm not. Uh, and they are able to seemingly not have any process. Those, that's, that's where genius lies. For those people that are fantastic, my observation is they have other problems.

• 43:41Speaker 00

  But for those of us who are not, particularly in something that hasn't happened before. Now, you know, things that are very known, uh, you can find guideposts. But in the world that I am involved in, uh, which, and the world that I'm most happy to be involved in is where something isn't known and you are making progress as you go, building a company step by step. An idea from whatever, wherever it comes from to whatever it's going to be. The, the only way to proceed is in that world of unknown, of building something

• 44:21Speaker 00

  is I could do it only by bouncing off the wall, going a step forward, pushing back, being pushed back a half a step. And eventually.

• 44:33Speaker 00

  Making less mistakes and busting through.

• 44:35Shane Parrish?

  I think what keeps people from doing that is they don't want to look like an idiot. So it prevents them from starting in the first place. They don't want to look like an amateur. They're scared, but what's your reaction to that?

• 44:46Speaker 00

  It was a long time ago. I don't know who said it or whatever, but it rang for me very true. Somebody said something and someone else said, well, that's stupid. And the person said, that's what I want. Stupid. The more I hear stupid, the more I will hear ideas. And so if you're in a process with other people and any idea,

• 45:15Speaker 00

  any idea dumb, stupid, wrong, uh, any one of those words you want to attach to it is a step to the next idea, which isn't. You gotta get stupid before you get smart.

• 45:29Speaker 03

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• 45:57Shane Parrish?

  You never feared failure because you had one primary fear most of your life, which made it easier for you to eliminate other fears. Yet, one of the things that stood out in the book was you had this contradiction. You struggled with this decision to leave Fox and start your own thing. Can you explore the tension there between what was the fear going into that?

• 46:20Speaker 00

  I'd been working in companies since I was 19. That was 30 years later. I was 49. I'd been a very good corporatist. I had run two movie companies and incredibly successful in that world that I was in. And yet I yearned for something that was my own and it wasn't mine. I mean, uh, I worked for large enterprises and like any good employee believes and acts like it's theirs. But that's a delusion. It isn't theirs. Someone else's and.

• 47:00Speaker 00

  That struck me and it sat with me for

• 47:05Speaker 00

  once I realized that I had this yearn for independence. Uh, I was very comfortable. I, I, I was, as I said, you couldn't be more successful than I was at that time. We created the fourth network. The Simpsons, like you had the. Very successful movie company, et cetera, et cetera. But it wasn't mine and I thought, well, what am I going to do about that? And I came up with this thing in my brain and I couldn't get out of my brain, which was either you are or you're not. It's binary. And you can do what most executives do, which is you rationalize and you, you know, you live a

• 47:47Speaker 00

  pretty good life. So you rationalize your situation or you just say, well, this is what it is. You don't have any yearn to be independent or on your own. I did. And I knew that that was binary and it just kept at me. I didn't, it wasn't that I was afraid. It was, I didn't want to confront the very binariness of it because on the other side of not being a corporatist or being on your own or being independent or wanting to build something yourself is that you are very far away from the mother church. You really are on your own. And while it didn't frighten me, it was like

• 48:31Speaker 00

  such a different solar system that I couldn't even conceive of it other than in these terms of you are or you're, you're not. And I couldn't accept that I was not. And that's, that's what got me out. It was my inability to accept that. And so I left Fox and.

• 48:51Speaker 00

  Had no clue what I was gonna do.

• 48:53Shane Parrish?

  So up until that point, you had been on the receiving end of a lot of these compensation agreements. And now you're setting them for your CEOs. How do you think about that? Do you have a different approach than others? Or how do you think about incentives and ownership?

• 49:06Speaker 00

  I believe in risk and reward. And I believe if the risks, if you take risks and if you're doing any valuable work, you're going to be taking risks. If it works out, the rewards should be there. And we now and always have, hope always will compensate people accordingly. People can't gain wealth in the enterprises that I'm involved in. Something's wrong with the enterprise. So I'm about wanting people to give people the opportunity to create real wealth with unlimited upside for it.

• 49:44Shane Parrish?

  How do you think about that? Can you walk me through an example of sort of like how you think about the principles of compensation and alignment? And a base salary and incentives?

• 49:55Speaker 00

  I think generally compensation that is stock based is not the best route. It depends, again, it's a broad general statement. For developed enterprises, it's not the best route. The best route is up to me, a much simpler one. If you create value working in a project or you create value to whatever degree you created, you should share in that value on a cash basis. Meaning any time period, a year, just take every year.

• 50:33Speaker 00

  If the enterprise does well, you should have a share of how well it does paid to you at that moment. What I have learned is that most people, you think that giving large populations options in the company's securities, that they would hold on to them. And what you find out is. Eighty, ninety percent? The first moment that they quote vest, they cash them. So it, I don't know. I've got a lot of endless thoughts about that that bore the hell out of everyone.

• 51:07Shane Parrish?

  Well, they won't bore me. I'm really curious about it, actually, because, you know, stock-based compensation is, it distorts a lot of the economics of the business and people think that it incentivizes or retains people when you've had no problem.

• 51:21Speaker 00

  I don't believe, by the way, I also, I, I, I've heard retention arguments from time immemorial, decades of, well, we do this to retain people. I think that's ridiculous. You retain people, people stay in your enterprise because they like what they do and there's opportunity there. A handcuff, so to speak, or they stay because they haven't vested in this or that. I think that's hogwash. I don't believe in retention. I believe in opportunity.

• 51:56Shane Parrish?

  I like the idea of sort of participating in the success of the organization. How do you think about it as a new CEO coming in, maybe to a mature business? And do you set the compensation based on above baseline for next year? Or how do you think about that?

• 52:11Speaker 00

  You certainly, if you have an ongoing business, you're really compensating people for growth. I mean, other than base tasks that need to be performed, you want growth. If people can provide you with growth, you should give them a share of that growth.

• 52:26Shane Parrish?

  If they want to be an owner, they can take their cash compensation and then go buy stock.

• 52:30Speaker 00

  Yes, absolutely. Give them their resources and let them go do it. But the wealth you can create for them, it should be based upon what they do and what they produce.

• 52:44Shane Parrish?

  Have you ever lost anybody ever because you wouldn't give stock options?

• 52:47Speaker 00

  No. I don't think so. See, people might say the yes, but I don't think so.

• 52:53Shane Parrish?

  One of my friends had a clever idea because he doesn't give stock options. So when he was recruiting people, they were like, we're walking away from all these options. And he's like, I'll give you the exact same options at the company you're leaving. But I'm not going to give you options in the company you're coming to.

• 53:07Speaker 00

  That's a good idea. I like that.

• 53:09Shane Parrish?

  One of the moments that really stuck out in your book, you had this core principle and you said that the clock starts ticking the moment you're made aware of the incident from the second, from that second, you're responsible for the actions. And I think you hit on that in relation to two of your marketing people who were stealing from you. Can you tell me that story and sort of what happened and what the realization was?

• 53:31Speaker 00

  It was my first exposure to something like that where

• 53:38Speaker 00

  we found out that two of our key executives had been stealing and and one of my colleagues said, you know, we can bury this. Another my colleague said, well, actually, one of the people who did this, they threatened you very directly, kind of blackmail and saying, if you expose this, or if you report this to the authorities, we'll do this terribly damaging thing, which was so heinous to me. But what I realized, and it is a great lesson for me, presuming you run a straight organization, or meaning in other words, presuming you're not engaged in

• 54:20Speaker 00

  nefarious stuff. But if something happens and it doesn't necessarily be somebody stealing, it could be one of your products has some antisocial thing that you discover, or somebody in your organization has just done something that is unethical, whatever it is. And so long as you're running a general, like you have checks and balances, up until that moment that you know it, you have no issue with culpability. You have no agency. You have no nothing. But the second you know it, the clock is ticking. And you have to have that in your brain. You have to know that every second after that, what you do about that.

• 55:05Speaker 00

  Is now your absolute responsibility. I have like a word bubble above my head about it. But it is a great discipline and I've seen so many situations where that was not recognized, where prevarication or other methods, where you're not aware that that clock ticks and every action you take is then your actions. Before that, you got no fault.

• 55:37Shane Parrish?

  I want to come to public broadcasting for a second. One of the, the things that I don't see getting enough attention that you wrote about was the fairness doctrine. I'm wondering if you can explain what that is and what the impact's been in getting rid of it.

• 55:49Speaker 00

  Well, the fairness doctrine was a fundamental tenet of broadcasting, which meant that you had to, in any dissemination of anything, you had to present, if there were two sides to an argument, you had to present them fairly. You had to be fair in your presentation. And this was along with a lot of other regulation thrown out some time ago. And I think is very unfortunate for the common wheel, as they say, meaning that that provides so for broadcasters, that and the fact that they still are, but they were licensed because they were using the public airways belonging to the public.

• 56:34Speaker 00

  And so you felt a responsibility, if you were in that world, to do the right thing. And we can define right in all sorts of different ways, but we all know what the mainstream of right is. To a very large degree, that's kind of been tossed and I think it's just very unfortunate.

• 56:53Shane Parrish?

  How do you think about the media landscape today in terms of information, disinformation, and how it's all playing out with people?

• 57:01Speaker 00

  Oh my God. I mean, it's, we're in a very difficult period about information, about facts. There is so much from our leadership that is not based on facts, is not true. It's promotional or it's just outright not factual. And we hear this thing about quote fake news.

• 57:26Speaker 00

  Principally by people who are faking news.

• 57:30Speaker 00

  Not always, of course. And listen, I hate the right as much as far right as much as I hate the, you know, the woke left is as horrible as the woke right, or woke right is whatever say it, any way you like. But we have lost a central fact-based method for the dissemination of, call it news broadly speaking. And this is, every bird brain knows this, most of the talkers are talking essentially to themselves and to their audience, reinforcing what they think, which is not necessarily factual, wherever you are in the spectrum. The biggest

• 58:15Speaker 00

  issue we have is having faith and belief in information. And that's, that's, that's a sorry state. And there are some trusted sources, relatively few.

• 58:34Shane Parrish?

  We always end these interviews with the same question, Barry, which is, what is success for you?

• 58:41Speaker 00

  Well, success for me is, is remaining curious. And it's the only thing that, the only thing that drives me is, is my curiosity. And if I'm curious, then that is success.

• 59:02Shane Parrish?

  I love that answer. Thank you very much for the time today.

• 59:05Speaker 00

  Nice to be with you.

• 59:06Shane Parrish?

  Thanks for listening and learning with us. Be sure to sign up for my free weekly newsletter at fs.blog/newsletter. The Farnham Street website is also where you can get more info on our membership program, which includes access to episode transcripts, my repository, ad-free episodes, and more. Follow myself and Farnham Street on X, Instagram, and LinkedIn to stay in the loop. If you like what we're doing here, leaving a rating and review would mean the world. And if you really like us, sharing with a friend is the best way to grow this community. Until next time.