#737: Naval Ravikant and Nick Kokonas

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 #97 "Naval Ravikant — The Person I Call Most for Startup Advice" and episode #341 "Nick Kokonas — How to Apply World-Class Creativity to Business, Art, and Life." Please enjoy! Sponsors: 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) Momentous https://livemomentous.com/tim high-quality supplements: https://livemomentous.com/tim (code TIM for 20% off) LinkedIn Jobs https://linkedin.com/tim recruitment platform with 1B+ users: https://linkedin.com/tim (post your job for free) Timestamps: [00:00] Start [04:34] Notes about this supercombo format. [05:53] Enter Naval Ravikant. [06:05] On uncompromising honesty. [08:05] What Naval looks for when deciding to invest in a founder. [11:03] Recommended reading from outside the startup world. [18:38] Who Naval considers successful. [21:02] Cultivating non-judgmental awareness. [26:08] How to replace bad habits with good habits. [29:31] Naval's advice for his younger self. [32:01] Naval's billboard. [35:46] Enter Nick Kokonas. [36:05] Is pressure Nick's default setting, or are perceived risks an illusion? [36:55] How do behavioral economics and Richard Thaler influence Nick's approach? [41:38] Nick's transition from philosophy to finance; was philosophy an asset? [42:43] Why Nick's professor gave him shorter assignments than classmates. [44:57] Nick's introduction to trading; dumbing down academics for clerk job. [46:42] Why philosophy majors often become traders. [47:19] Why Nick is glad he didn't pursue an MBA in 1992. [48:41] Why Nick thinks his professor singled him out from his peers. [52:52] Recommended books for aspiring entrepreneurs without philosophy background. [57:31] Did being a Merc clerk meet Nick's expectations? [1:00:02] How Nick followed his father's entrepreneurial model in trading. [1:04:38] Why Nick left his mentor after a year to start his own company. [1:05:41] How Nick and employees trained to quicken mental agility for trading. [1:08:17] The moment Nick realized he could thrive in trading. [1:09:02] Recommended resources for becoming a better investor. [1:11:22] Nick seeks out "high, small hoops" for investment risks. [1:14:00] Do businesses fail due to difficult model or lack of due diligence? [1:16:55] When and why Nick decided to enter the restaurant business. [1:18:26] The dinner leading to Nick and Grant Achatz's partnership. [1:27:52] Why Nick chose to open a restaurant out of many risky options. [1:30:33] How Nick spots talent early that others notice late. [1:34:07] Questioning restaurant conventions like candles and white tablecloths. [1:37:09] A now-famous chef was Alinea's first customer. [1:38:03] Nick and Grant wouldn't let designers override their ideas. [1:38:47] How Nick contributed effectively as a restaurant industry newcomer. [1:14:19] Why Nick was "horrified" when Alinea won Best Restaurant in 2006. [1:43:50] Grant's cancer diagnosis; writing a book and revolutionizing reservations. [1:45:28] Traditional restaurant reservation systems and Nick's improvements. [1:57:17] Bickering at press dinner; avoiding Next becoming "Disneyland of cuisine." [2:02:14] Reservation software problems; variable pricing based on day of week. [2:05:48] The moment Nick realized "This is the best thing I've ever built." [2:07:41] Why the reservation system's rewards were worth the asymmetric risks. [2:10:16] Using Marimekko charts to visualize restaurant and sponsorship data. [2:16:57] The next industry Nick wants to disrupt: truffles. [2:18:55] Illuminating black boxes. [2:26:24] Self-selection of job roles; how Nick's hiring process has changed. [2:32:01] Systems Nick uses to cope with a lot of email. [2:37:43] Importance of engaging on social media, even if unable to respond to all. [2:39:35] What "puzzle" filters and mini-hurdles in correspondence accomplish. [2:40:36] Comparing similarities between the music and publishing industries. [2:49:55] The agency problem as another black box. [2:54:58] The Hembergers, The Alinea Project, and the upcoming independent Aviary Book. [3:01:42] A brief discussion about cocktails. [3:05:42] Books Nick has gifted most and how he personalizes gifts. [3:08:10] Nick's billboard. [3:09:49] 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. 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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 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.

• 0:44Tim Ferriss?

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• 1:28Tim Ferriss?

  That's Eight Sleep all spelled out, 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.

• 1:46Tim 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 formulas. I'll come back to the latter part of that a little bit later. Personally, I've been using Momentous Magthreanate, Lthianine, 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. I've also been using Momentous Creatine,

• 2:30Tim Ferriss?

  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 products to market,

• 3:14Tim Ferriss?

  including a few you will recognize from this podcast, like Dr. Andrew Huberman and Dr. Kelly Starrett. They also work with Dr. 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 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, Momentous ships internationally, so you have the same access that I do. So check it out.

• 3:55Tim Ferriss?

  Visit livemomentous.com/tim and use code TIM at checkout for 20% off. That's live momentus, L-I-V-E-M-O-M-E-N-T-O-U-S dot com slash TIM and code TIM for 20% off.

• 4:11Speaker 01

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

• 4:15Speaker 02

  Can I ask you a personal question?

• 4:17Speaker 03

  No, it is an inappropriate time.

• 4:21Speaker 02

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

• 4:34Tim 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

• 5:17Tim Ferriss?

  you to, yes, enjoy the household names, 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 03

  First up, Naval Ravikant, @naval on AirChat and Twitter, co-founder of AirChat and Angel List, and host of the Naval Podcast.

• 6:05Naval Ravikant?

  I have a couple of core foundational values. And they're not things that I explicitly develop. They're just sort of, you can look back after the fact and say, oh, yeah, I won't compromise on those things. But now I realize how important honesty is. And I learned that from a couple of different places. One is, when I grew up, I wanted to be a physicist, and I idolized Richard Feynman. I read everything by him, technical and non-technical, that I could get my hands on. And he said, "You must never, ever fool yourself, and you are the easiest person to fool." The physics grounding is very important because physics, you have to speak truth. You don't compromise. You don't negotiate with people. You don't try and make them feel better because if your equation is wrong, it just won't work, whatever you're doing. So I think the science background is important in that. A second is growing up in New York.

• 6:49Naval Ravikant?

  I grew up around some really rough and tumble kids, some of who were actually the Russian mob. And I once had an encounter where I watched one of them threaten to kill the other. And the would be victim went and hid. And then finally, he let the aggressor into his house after the aggressor promised him, no, I'm not going to kill you. Honesty was such a strong virtue between them that even when they were ready to kill each other, they would take each other's word for things. It sort of went above everything. And even though it was honesty in a mob context, I realized like how important that is in relationships. And then as I get older in life, I realized that a lot of happiness is just being present. And whether you get this out of Buddhism or cognitive therapy or drugs or wherever, you realize that to live in the present moment is the highest calling. It's the source of all happiness.

• 7:33Naval Ravikant?

  And when you're not honest with somebody else, or when you even withhold something in your mind, what you've done is you've created a second thought process. You've created a second thread in your head that then has to stay active, keeping track of what you've said versus what you're really thinking. And that takes you out of the moment and it brings you unhappiness over time. You will not realize it at that moment itself, but it will create stress and distraction. So if you really want to be happy, you have to be present. And one of the core tenets of being present is to be completely honest at all times.

• 8:05Tim Ferriss?

  There is a great short book that had a huge impact on me on this topic called Lying by Sam Harris, which was just phenomenal because it explored the impact not just of lying in the way that most people think of it, but generalized deceit or even white lies that are intended to protect people. What are the things that you look for in founders or the red flags that disqualify an investment or a founder?

• 8:31Naval Ravikant?

  So number one, intelligence. You got to be smart, which means you have to know what you're doing to some level. And that's a fuzzy thing, but you talk to people and you kind of get a sense of, do they know what they're doing or not? Do they have insights? Do they have specific knowledge? Have they thought about this problem deeply? It's not about the age. It's not how many years they've spent, but just how deep is their understanding of what they're about to do? So intelligence is key. Energy, because being a founder is brutally difficult. It takes a long time. And in the long run, the people who succeed are just the ones who persevere. So if someone runs out of energy or if they're doing this in some... Hesitating preliminary way where they're looking for constant positive feedback. Or if they're easily thrown off course, then they're not going to make it to the end,

• 9:15Naval Ravikant?

  especially in the highly competitive startup context. And then finally is integrity. Because if you have someone who has high intelligence and high energy, but they're low integrity, what you've got is a hardworking, smart crook. And especially in the startup world, things are very dynamic. They're very fast moving. People are very independent. So if somebody wants to screw you over, they will find a way to do it. And fundamentally, ethics and integrity are what you do despite the money. If being ethical was profitable, everybody would do it. So what you're looking for is a core sense of values that rises above and beyond the pure financial incentives. So for example, if I'm talking to a founder and they offer to do something that is slightly unfair to another shareholder or employee or founder in exchange for making me happy, that's a red flag.

• 9:59Naval Ravikant?

  Because if they can do it to them, they can do it to me. And integrity is the hardest one to figure out because it requires longitudinal relationships.

• 10:05Tim Ferriss?

  Meaning long term.

• 10:06Naval Ravikant?

  Exactly. So I've just become more hyper aware of that piece as time goes on. But those are kind of the three things that I look for. And then I think that isn't really about success, but it's more just about personal time is when you invest in somebody or you work with somebody, you start a company with somebody, you're signing up to spend the next decade of your life having them in your life.

• 10:26Tim Ferriss?

  Right.

• 10:26Naval Ravikant?

  And so you just have to make sure you actually genuinely like these people. You don't consider work to have to answer a phone call or take a meeting or spend time with them. If it's exhausting, if they're downers, if they're negative, if they're difficult, no amount of money is worth it. You and I will both die with money in the bank. It's not about money at this point. It's about do I want to spend my scarce time, resources, mental energy, spirit, interacting with these people? My favorite founders are actually the ones who I learned from. So every time they call me up because they need help with something, I jump on it because I know that walking around the block with them for an hour, I'm going to walk out much smarter.

• 11:03Tim Ferriss?

  What books or people outside of the startup world have most improved your ability to invest? Maybe broadly speaking, just resource allocate.

• 11:17Naval Ravikant?

  This is a really good question. It's a very deep question. It's gonna have lots of answers. But at the end of the day, I think you have to work in your internal state until you are free of as many biases and conditioned responses as you can be. And it will improve every aspect of your life, including investing. And I am a bookworm, so I read an enormous amount. I was raised essentially in a library of the daycare center. And so I've just read so much that I don't even know where to start. But if you work on your internal state, one of the things you start realizing is as an investor, emotions dominate. Investors are very emotional, even though we act. We pretend to be very rational. For example, you'll decide in the first five minutes of a meeting, usually, whether you want to invest in the company or not. And if a company doesn't take your money in the first round,

• 12:02Naval Ravikant?

  you get annoyed with them, or you feel like they crossed you, then you have to undo that emotional state. So when the second round comes along, you can still be a positive force and continue to help the company and maybe have a bite at the apple a second time. And these kinds of skills are extremely hard to build. They're not things you're gonna build by reading one book and then you're like, aha. So I don't believe in the epiphany theory of self-development, where you read some book, you have an incredible epiphany. You read one phrase, you're like, okay, that's great. This changes my life. And then you scroll it down a piece of paper and you keep looking at it, or you put it as a backdrop to your computer screen. Life doesn't work that way. What you kind of have to do is you have to build skills. And I think happiness is a skill, nutrition is a skill, diet is a skill, investing is a skill, self-awareness is a skill.

• 12:47Naval Ravikant?

  And skills get built up over decades with feedback loops. And you just have to constantly keep working on it. So the books that have helped me a lot, I think there's a class of books that I would kind of put in the Stoicism category. And I know you've been a big advocate of these in the past. And I sort of discovered them independently, but they were very influential. So Seneca and Marcus Aurelius both stand out. Meditations by Marcus Aurelius was absolutely life-changing for me because it's the personal diary of the emperor of Rome. And here's a guy who was probably the most powerful human being on earth at the time that he lived, and he was writing his own diary to himself, not expecting it to be published. And when you open this book, you realize He had all the same issues and all the same mental struggles and he was trying to be a better person.

• 13:31Naval Ravikant?

  And so right there, you figure out, okay, success and power don't improve your internal state. You still have to work on that. And so that class of books is very influential. I'd like to pay attention to what I consider the rational Buddhists. Because a lot of Buddhism is drowned in mysticism and Hinduism and sort of worship this guru or do this ritual. I don't pay any attention to that. But I pay a lot of attention to what I consider rational Buddhists, where they can make the case very intelligently with reasoning along the way as to how you should train your mind to work or how you should observe your mind. Sam Harris, who you mentioned earlier is great. Jiru Krishnamurti, who's a lesser well-known guy, but an Indian philosopher who lived during the last century, is extremely influential to me. He's an uncompromising, very direct

• 14:16Naval Ravikant?

  person who basically tells you to look at your own mind at all times. And so I have been hugely influenced by him. Probably the best book of his that I like is one called The Book of Life, which is sort of excerpts from his various speeches and books that are stitched together. Oddly enough, Bruce Lee wrote some great philosophy. And Striking Thoughts is a book that is a good summary of some of his philosophy. But I could go on and on and on. I mean, there are, you have to read hundreds of these things, literally. Blogs, the blogs are, I feel, an underappreciated resource. We're now in a day and age of Twitter and Facebook. We're getting sort of bite-sized, pithy wisdom that's really hard to absorb. And books are very difficult to read as a modern person because we've been trained. Well, we've got two contradictory pieces of training.

• 15:00Naval Ravikant?

  One is our attention span has gone through the floor. Because we're hit with so much information all the time that we want to skip, summarize, skip. We want to get to the TLDR, cut to the chase, too long, didn't read. You know, what's the 140-character version? What's the Instagram version? On the other hand, we're also taught from a young age that books are something you finish. Books are something that are sacred, that you treat books as, you know, when you go to school and you're assigned to read a book, you have to finish the book. So we forget how to read books, or we get in this contradiction where everyone I know is stuck on some book. Everyone is stuck on some books. I'm sure you're stuck on some book right now. It's like page 332, you can't go on any further. You know, you should finish the book. So what do you do? You give it reading books for a while.

• 15:41Naval Ravikant?

  Your Kindle or your iPad or whatever you use, or even your paper book is at a stuck state. That for me was a tragedy because I grew up on books and then I switched to blogs and then I switched to Twitter and Facebook. And then I realized I wasn't actually learning anything. I was just taking a little dopamine snacks all day long.

• 15:59Naval Ravikant?

  I was getting my little hundred forty character burst of dopamine and then I'd retweet and then I'd see who retweeted my tweet. Then I get into an argument on Twitter and you know, it's a fun, wonderful thing, but it's a game that I was playing. I wasn't actually learning anything. Usually with Startup L. Jackson is. Yeah, Startup L. Jackson, great character on Twitter. So I realized like I have to go back to reading books because when you're talking about solving old problems, the older the problem, the older the solution. So if you're trying to learn how to drive a car or fly a plane, absolutely, you should read something written in the modern age. Because this problem was created in the modern age. The solution is created in the modern age. But if you're talking about an old problem, like how to generally keep your body healthy, how to stay calm and peaceful of mind,

• 16:43Naval Ravikant?

  what kinds of value systems are good, how should you raise a family, these kinds of things, the older solutions are probably better. And they withstood the test of time. Any book that survived for two thousand years has been filtered through a lot of people. Now, it may have some stuff in it that we now know to be true, but the general principles are more likely to be correct. So if I want to learn the theory of evolution, which I kind of use as my binding principle whenever I'm trying to explain any human action. People read all kinds of blog posts and tweets and evolution. Everyone has a loose understanding of how evolution works. But how many have actually read The Origin of Species? I mean, you can get it for five bucks on Kindle and it's a very easy read. It's not a difficult read.

• 17:23Naval Ravikant?

  And you can read the actual source and you can see the source of the brilliance and you can see how Darwin came up with stuff back then that we're still trying to figure out or statements he made that we're still trying to prove out. But there's very little that's incorrect in that book and it is a source book. So I wanted to get back into reading these source books. And I knew it was a very hard problem because my brain had now been trained to spend time on Facebook and Twitter and these other bite sized pieces. So what I did was I came up with this hack where I started treating books as throwaway blog posts or as bite-sized tweets or Facebook posts, and I felt no obligation to finish any book. So now anytime someone mentions a book to me, I buy it. At any given time, I'm reading somewhere within 10 and 20 books. I'm flipping through them. If the book is getting a little boring,

• 18:06Naval Ravikant?

  I'll skip ahead. Sometimes I'll start reading a book in the middle because some paragraph caught my eye and I'll just continue from there. And I feel no obligation whatsoever to finish the book. If at some point I decide the book is boring, or if it's got pieces of it that are incorrects and I can't trust the rest of the information in there, I just delete it. And I don't remember them at all. So I treat books now as other people might treat throwaway light pieces of information in the web, and all of a sudden, books are back into my reading library. And that's great because there's a lot of ancient wisdom in there.

• 18:37Tim Ferriss?

  When you think of the word, say, "successful," who's the first person or people who come to mind for you?

• 18:44Naval Ravikant?

  Yeah, it's an odd answer because, you know, most people think of someone as successful when they win the game. And it's whatever game they're playing, right? So if you're an athlete, you're gonna think of successful, someone who is a top athlete and wins that game. Or if you're in business, then you gotta think Elon Musk or, you know, someone of that sort. Or in my mind, I would have answered that question a little differently a few years ago. I would have said Steve Jobs because he created something, or he was a driving force, part of the driving force and the spearhead for creating something that has changed the lives for all of humanity. And that's the iPhone. You know, I think of Marc Andreessen as super successful, not because of his recent incarnation as a venture capitalist, which is an interesting one, but because of the incredible work that he

• 19:27Naval Ravikant?

  did with Netscape. He commercialized the web browser. Satoshi Nakamoto is successful in the sense that he created Bitcoin, which is this incredible technological creation that will have repercussions for decades to come. So in the classic sense, I consider those creators and commercializers successful. And of course, Elon Musk, just because he changed everyone's viewpoint on what is possible with modern technology entrepreneurship. But that said, to me, the real winners are the ones who step out of the game entirely, who don't even play the game, who rise above it. And those are the people who have such internal mental and self-control and self-awareness that they need nothing from anybody else.

• 20:05Naval Ravikant?

  So there are a couple of these characters that I know in my life, some older gentlemen that I like to kind of learn from. And we mentioned our Polish friend earlier. I would consider him successful because he doesn't need anything from anybody. He is at peace, he is at health. And whether he makes more money or less money, or whether the next person over from him does better or worse than him, has no effect on his mental state and bearing. And historically, I would say that the legendary Buddha, or Krishnamurti, whose stuff that I like reading, they are successful, quote unquote, in the sense that they step out of the game entirely. Winning or losing does not matter to them. There's some line that I read somewhere that, "All of man's troubles arise because he cannot sit in a room quietly by himself for half an hour." Right?

• 20:50Naval Ravikant?

  And if you could literally just sit, if you could just sit for 30 minutes and be happy, you are successful. And I think that that is a very powerful place to be, but very few of us get there.

• 21:01Tim Ferriss?

  Do you have a current meditative practice?

• 21:04Naval Ravikant?

  I have a couple. Like most people, I talk about doing it, but don't really do it all that well.

• 21:11Naval Ravikant?

  I think meditation is like dieting, or where everyone is supposed to be following a regimen. Everyone says they do it, but nobody actually does it. The real set of people who meditate on a regular basis, I've found are pretty rare. And I've identified and tried at least four different forms of meditation. The one that I've found that works the best for me is something called choiceless awareness, or non-judgmental awareness, where you essentially don't sit in the corner and don't stay quiet. You walk around, you're going about your daily business. But hopefully, there's some nature around. You're not talking to somebody else. And what you practice is you just learn to accept that moment that you're in without making judgments. You don't say, "Oh, there's a homeless guy over there a bit across the street." You don't look at two people running by and say, "Oh, he's out of shape,"

• 21:56Naval Ravikant?

  or "I'm in better shape than him," or "That person's better than me," or "This one's better," or "I should go get a coffee," or whatever. You just don't make any decisions. You don't judge anything. You just accept everything. If you do that, I find if I can do that even for 10 or 15 minutes, walking around, I end up in a very peaceful, grateful state. And so that one works well for me.

• 22:13Tim Ferriss?

  When those thoughts come up, right? When you see the guy with the bad hairdo and you're like, "That guy has no business having that unmanageable hairdo," or whatever ridiculous thought comes to mind, what is the internal response to that?

• 22:27Naval Ravikant?

  What I do is, for those of you who programmed, I'm basically trying to run my brain in debugger mode. I'm trying to be very, very alert and watch my thoughts. You're not trying to judge anything, including your own thoughts. You know, there's a great definition that I read that says enlightenment is a space between your thoughts, which means that enlightenment isn't this thing you achieve after 30 years sitting in a corner on a mountaintop. It's something you can achieve moment to moment, and you can be a certain percentage enlightened every single day. So you want to create as much space between your thoughts as possible. And the way you do that is by being aware of what your thoughts are and why you're having them. So if I saw the guy with the bad hairdo and a toupee, I would look at that and I would, at first I'd be like, haha, he has a bad hairdo. And then I'd say, well, why am I laughing at him? Oh, to make me feel better about myself.

• 23:10Naval Ravikant?

  And why am I trying to make me feel better about my own hairdo? Oh, because I'm losing my hair and I'm afraid it's going to go away. And what I find is that 90% of thoughts that I have are fear. 90% are fear-based. The other 10% are probably desire-based and as any-

• 23:24Tim Ferriss?

  It's a very tactful way to put it.

• 23:26Naval Ravikant?

  Yeah, and as any Buddhist will tell you, that desire is just fear by another name. It's the other coin, the other coin of fear.

• 23:32Tim Ferriss?

  Oh, I thought you were talking about something else entirely.

• 23:34Naval Ravikant?

  Ah, lust.

• 23:35Tim Ferriss?

  There's this-

• 23:35Naval Ravikant?

  Lust?

• 23:36Tim Ferriss?

  Yeah. There's this cartoon, I don't know if you know who Harry Crumb is. He has all of these very sort of profane comic strips and was very famous. And there's a great documentary about him as well. Wait, Harry Crumb, I think that's actually a comedy, but R. Crumb. Maybe I'm mixing it up. In any case, somebody can correct me in the comments. But there's this one cartoon of his. I think it's a single cell, kind of like the Far Side in its format. It's basically a drawing of people on the street in Manhattan. And every man has a thought bubble above his head with a vagina in it. And every woman has a thought bubble above her head with a penis in it. And just everybody walking.

• 24:10Naval Ravikant?

  That's why the Adam and Eve story is there, right? Original sin is lust. It's a thing that makes you fall out of heaven. The same way, maybe some of your readers have read this book called Siddhartha. But it's a beautiful parallel story to The Making of the Buddha by Herman Hesch. It's a great book, I highly recommend it. But even in that book, our protagonist is out there seeking enlightenment and gets really close. And the thing that drops him out of it is lust. He meets a woman that he falls, he feels lustful towards. And that sort of slowly becomes his undoing into everything. But anyway, so to answer your original question, when I'm doing the choiceless awareness form of meditation, which by the way, as far as I can tell, is not taught in any school. It's something that I discovered mostly by reading enough of Krishnamurti's book and piecing together what he meant, because he's a very, he's not a very clear speaker at

• 24:54Naval Ravikant?

  times, or he is clear, but in a very different kind of way. And then I realized that, okay, so the point of meditation is to clear your mind. And the way to clear your mind is, yes, you can sit in the corner and struggle with it, which doesn't really get you the outcome. Or you can do transcendental meditation, which is where you're using this chanting to create a white noise in your head to bury your thoughts. Or you can just very keenly and very alertly be aware of your thoughts as they happen. And as you watch them, you realize how many of them are just fear-based. And the moment you recognize it is fear, without even trying, it sort of goes away. And then after a while, your mind quiets. And when your mind quiets, you stop taking everything around you for granted. You start noticing the details of, oh my God, I live in such a beautiful place. It's so great that I have clothes on me.

• 25:39Naval Ravikant?

  Yeah, I can go into a Starbucks and get a coffee anytime I want. How rich am I? Look at these people, they're, you know, each one has a perfectly valid and complete life of their own in their own heads that's going on. It pops us out of the story, the dream that we're always in, the story that we're constantly telling ourselves. And if you stop talking to yourself for even 10 minutes, or if you stop obsessing over your own story for even 10 minutes, you'll realize that we are really far up Maslow's hierarchy of needs and that life is pretty good.

• 26:08Tim Ferriss?

  What is a bad habit that you're working to overcome right now?

• 26:11Naval Ravikant?

  So this is something that I learned through our Polish trainer friend, Victor.

• 26:18Tim Ferriss?

  Hi, guys. Just a quick note from present day Tim. The Polish friend and trainer in question is Jerzy Gregorik. And you can hear my conversation with Jerzy, titled "The Lion of Olympic Weightlifting, 62-Year-Old Jerzy Gregorik," which also features Naval. Naval and I were working with him at the time. We both co-interview him. I still work with Jerzy, and I just saw him just a few weeks ago. So to learn more about this amazing man, go to tim.blog/jerzy, J-E-R-Z-Y, to listen to that conversation one more time. tim.blog/jerzy, J-E-R-Z-Y. At the age of, whatever he is now, 67, he can still do things that most 20-somethings cannot do. Now, back to the episode with Naval.

• 27:04Naval Ravikant?

  Habits are everything, everything. I think that we are, we are trained in habits from when we were children, including potty training and when to cry and when not to, and how to smile and when not to. And all of these things become habits. These are all behaviors that we learn and that we then integrate into ourselves. And then what ends up happening when we're older is that we're a collection of thousands, maybe tens of thousands of habits that are constantly running subconsciously and they're internalized. And then we have a little bit of extra brain power in our neocortex for solving new problems. And so you become your habits. And what really brought this to light for me is our friend, our trainer, gave me a routine to do every single day. And before that, I had never worked out every single day.

• 27:49Naval Ravikant?

  And it's a light workout. It's not tough on your body. But I did this workout every single day and I realized the incredible, astonishing transformation that it had upon me, both physically and mentally. Because I think to have peace of mind, you have to have peace of body first. So that taught me the power of habits. And after that, I started realizing that it's all about habits. So at any given time now, within a six-month period, I'm either trying to pick up a good habit or I'm discarding a previously bad habit. And it takes time. So for example, if someone says, "I want to be fit. I want to be healthy, but right now I'm out of shape and I'm fat." Well, nothing is going to work for you in three months. It's going to be sustainable. It's going to be a 10-year journey, at least. And in the 10-year journey, what you're going to do is every six months

• 28:34Naval Ravikant?

  or every three months, depending on how, how fast you can do it, you're going to break bad habits and you're going to replace them or you're going to pick up good habits. So I think it is all about habits. There is nothing else. Examples of habits I've picked up in the last 12 months or I'm still working on. I'm one of these people who wants everything. So I don't want to give up anything. So for example, if I want to stop eating bad foods, if I want to lose weight by fixing my diet, I don't say, "These foods are bad. I'm not going to eat them," and then suffer and then feel like I'm not eating tasty food. Instead, what I do is I do some combination of changing my taste buds. To actually like the foods that are healthier for me and substituting unhealthy tasty foods with healthy tasty foods so that I can sustain it forever.

• 29:19Naval Ravikant?

  I'm not interested in anything that is unsustainable or even hard to sustain. I want my life to be effortless. So, once I've created a good habit, it has to be the kind of habit that I can sustain with no effort.

• 29:30Tim Ferriss?

  You're about to graduate. If you had to go back and give that Naval advice, you're already hooked on reading. So, that seems to be covered. What advice would you give yourself?

• 29:40Naval Ravikant?

  Yeah, it's funny. I actually did this exercise recently where I sat down and I didn't write it because it was in my head. But I did spend some time thinking about what is the advice I would give my 30-year-old self? And the advice was along the lines of chill out, don't stress so much, not so much anxiety. Everything will be fine and be more yourself. Don't try and do what you think society wants or needs. Don't try and live up to other people's expectations. Self-actualize, say no to more things, protect your time because it's very precious. You know, on your dying day, you will give everything, everything you have for another day. So, the discount rate, the marginal value of that extra day just goes up as you get older. So, the advice was all along those lines.

• 30:22Naval Ravikant?

  It was basically be yourself, don't listen to other people, don't worry about what other people need or want or think or expect from you. And then I said, well, what would my 30-year-old self have said to my 20-year-old self? And it turned out to be pretty much the exact same thing. And what would my 20-year-old self have said to my 10-year-old self? Pretty much the exact same thing. So, I think my 50-year-old self is going to say chill out, relax, don't stress so much. Live in the moment, it'll all be all right. Less fear, more love, you know, and love people more. You know, love is one of those weird things, like everyone wants to be loved. Everyone deeply needs to be loved. It's not something you can buy. No amount of money or power will bring you true unconditional love. But it turns out you can give love, it's free to give. So, you can't necessarily get it, but if you can get in the mindset of, well, I'm just going to give it.

• 31:06Naval Ravikant?

  Eventually, on a long enough time scale, you get what you deserve. The universe kind of sends it back your way.

• 31:12Tim Ferriss?

  Yeah, well, not only that, it's like if you don't know how to make yourself happy, try to make someone else happy. And that is sort of a, as you said, kind of a recursive function. And now I'm getting, I'm using vocab I shouldn't, but.

• 31:24Tim Ferriss?

  It's a virtuous cycle.

• 31:26Naval Ravikant?

  Charlie Munger, who's Warren Buffett's partner at Berkshire Hathaway, and just a brilliant older gentleman. His speeches are collected in Poor Charlie's Almanack, and they're worth reading. But he was asked at one of the Berkshire Hathaway annual meetings, someone basically asked him along the lines of like, you know, how do I find a worthy mate? And he said, be worthy of a worthy mate. And I think that's absolutely right. You just work on yourself until you no longer need them, and then they appear. I think that's what the Zen saying that says, when the student is ready, the master appears. What that basically means is you have to work on yourself and be ready, and then good things will happen to you.

• 32:00Tim Ferriss?

  If you could have one billboard anywhere with anything on it, what would it say? Where would you put it?

• 32:08Naval Ravikant?

  I don't know if I have messages to send to the world, but there are messages that I like to send to myself at all times. One message that really stuck with me when I figured this out was that, what is desire? And desire is a contract you make with yourself to be unhappy until you get what you want. I don't think most of us realize that's what it is. I think we go about desiring things all day long and then wondering why we're unhappy. So I like to stay aware of that because then I can choose my desires very carefully. I try not to have more than one big desire in my life at any given time. And I also recognize that as the axis of my suffering. I realize that that's where I've chosen to be unhappy. So I think that that is an important one.

• 32:51Naval Ravikant?

  Or even a simpler one is, you know, a lot of meditative, like you said, you did a transcendental meditation course that give you a mantra. The mantra is supposed to have actually no meaning. Maybe the universal mantra, you know, that's been derived through the ages is Om, where you kind of sit there and say Om in your mind to yourself. It's strange, you can say it to yourself all day long in your mind. It'll make you happier, more peaceful. You start chanting it out loud, they'll lock you up. But Om, Om has no meaning, I think. But to me, it has a meaning, and the meaning is just accept. Just accept. In any situation in life, you only have three options. You always have three options. You can change it, you can accept it, or you can leave it. Those are your three options. What is not a good option is to sit around wishing you would change it,

• 33:35Naval Ravikant?

  but not changing it, wishing you would leave it, but not leaving it and not accepting it. So it's that struggle, that aversion, that is responsible for most of our misery. So probably the phrase that I use the most to myself in my head is to just tell myself one word, "accept." So anytime I look at myself and I'm judging something, I just say, "accept." And it's only very, very, very few things that I will choose not to accept. And if I don't accept something, it's for one of two reasons. Either I'm aware that this is something that it's just so important to me right now that I can't accept it, and now I'm going to put up with a mental battle for it, or more likely, I've just lost control of my thoughts. I'm no longer present. I'm dreaming. I'm in a highly emotional state.

• 34:19Tim 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 LinkedIn Jobs. When you're hiring for your small business, you want to find quality professionals that are right for the role as soon as possible. That's why you have to check out LinkedIn Jobs. LinkedIn Jobs has the tools to help find the right professionals for your team faster and for free. LinkedIn isn't just a job board. LinkedIn helps you hire professionals you can't find anywhere else, even those who aren't actively searching for a new job, but who might be open to the perfect role. In any given month, more than 70% of LinkedIn users don't visit other job sites. So if you're not looking on LinkedIn, if you're not using LinkedIn, you are in the wrong place. More than 2.5 million small businesses

• 35:04Tim Ferriss?

  use LinkedIn for hiring, with 86% getting a qualified candidate within 24 hours. LinkedIn knows that small business owners, leaders, execs are wearing so many hats, they're stretched thin. They might not have the time or resources to hire in any drawn-out way. So LinkedIn is constantly finding ways to make the process easier. In fact, they just launched a feature that helps you write job descriptions, making the entire thing, A to Z, faster and much simpler. So hire professionals like a professional on LinkedIn. And now you can post your job for free at LinkedIn.com/Tim. That's LinkedIn.com/Tim to post your job for free. Terms and conditions apply.

• 35:46Speaker 03

  And now Nick Koconis, Instagram @Nkoconis, Twitter @NickKoconis. Nick is the co-owner and co-founder of the Alinia Group of Restaurants, which includes Alinia, one of only 13 restaurants in the US to earn the coveted Michelin 3-star rating.

• 36:07Tim Ferriss?

  Nick, welcome to the show.

• 36:09Nick Kokonas?

  Thanks, Tim. Awesome to be here finally.

• 36:12Tim Ferriss?

  Yeah, yeah, we have the benefit of having spent some time together and I have been fed a lot of caffeine by you and you're also of great help with The 4-Hour Chef, so I wanted to, right off the bat, thank you for that.

• 36:26Nick Kokonas?

  It was kind of a fun thing because I remember when you, you sent me like a preview of the book and then you called me to say like, "Hey, you know, you want to say anything about it?" And I was like on a chairlift and I was like, "By the time I get off this chairlift, I will have a blurb for you."

• 36:42Nick Kokonas?

  With such pressure.

• 36:43Tim Ferriss?

  Which meant a lot and pressure, I think, is the word to describe so much about you and your life. I want to say trajectory, but I'm not even sure that is the right word. And I thought a fun way to kick off the conversation would be to share with people listening some of the back and forth that we had when we were brainstorming what a podcast might look like. Because certainly, I don't think of you first and foremost as a food guy, per se. And we were having this exchange via text and then via email. And I thought I'd just read one of your responses as we were swapping different ideas. I'll probably

• 37:28Tim Ferriss?

  edit for space a little bit here, but not by much. And here we go. "I'm a huge believer in radical transparency in business. I give numbers and burn bridges with big companies because I think that a lot of times people don't ask the basic questions in publishing, for instance. How much did that book cost to print? How many did it sell? Oddly, those numbers are very hard to come by. I dug for months, years ago, to do the Alinia book the right way. For bars, why does a bartender wash dishes and talk to customers? We've redesigned the bar experience and won Best Bar in the World." For restaurants, why is it the only form of entertainment that has only a mutual promise to show up? And then it goes into behavioral economics and in parentheses, I don't even know how to pronounce this last name correctly, Richard Thaler? Or is it Taylor?

• 38:11Nick Kokonas?

  Yeah, Thaler.

• 38:11Tim Ferriss?

  Thaler is a friend and investor, just won the Nobel Prize. Investing, been beating the market for nearly 30 years. Everything, in all caps, is about asymmetric risk-taking and information. And yet, people's perception of risk, or of what I do, is that it's risky. It is not. And in a separate exchange, when we were talking about many of the topics that you could talk about outside of, say, restaurants, bars, and so on, even though that's been a big part of your life in recent history, many of these different experiments, explorations, portions of your career, topics that you could talk about, and then going into what you said, they come down to a single thought, really. Wherever there is opaque information that should be obvious, run to that gap.

• 38:56Tim Ferriss?

  So I struggle with where to even begin with the 20 options that we have here, but maybe you could explain to me how behavioral economics and Richard Thaler fit into this, just for curiosity's sake.

• 39:14Nick Kokonas?

  I'll go back to the word you used, options, because I started out back in 1992 or '03 studying options, trading, derivatives trading. And I think there's a huge misconception about what that is because of movies, because of The Big Short, because of Wall Street, all of that. It's a bit like playing a game of chess for a living, or being the house at a casino, that sort of thing. It's about taking hundreds and hundreds and hundreds of decisions per day and pretending it's like a big decision tree. And any given decision is, if you're really good, 48% chance of being wrong. So you have to be really, really good at... Constantly being comfortable being wrong,

• 39:59Nick Kokonas?

  but knowing that your overall number of decisions, that you're going to be right more than you're wrong. I know there's like a big theme. A lot of the folks that you have on, like they talk about success or failure, how to measure those things. And I kind of don't look at it as success or failure with anything. I look at it as just like, is my pattern of decisions correct? And then getting back to your actual question with Professor Thaler and behavioral economics. And I mean, essentially what they're looking at is decision making. What drives people to make certain decisions? What's rational about those decisions? What is mostly irrational or emotional? Or what decisions do we make that people don't even realize they're making a decision, which is often the case as well?

• 40:43Nick Kokonas?

  And then if you think about it, every single form of what we do, art, commerce, science, you know, picking a mate, like all those things, comes down to a whole bunch of decisions that you make without often really thinking about the decision itself. Not that you can go around walking around going, wow, I've just made another decision. But when you are doing, you know, business or starting a company or publishing a book or whatever it may be, you can be intentional about that and realize that it's going to be an iterative process. And so I think that's been not only the case for me in learning how to filter things through that mindset. But like when you said there isn't really a trajectory, I kind of look at everything I've done as the same in a way,

• 41:27Nick Kokonas?

  even though other people look at it and go like, wow, you went from being a derivatives trader to owning restaurants. Like, that's weird. And I studied philosophy in college. So like people are like, how do you go from philosophy to finance? You know, and to me, it was all the same thing.

• 41:40Tim Ferriss?

  That particular transition or rather progression, I suppose, from philosophy to finance is one that you and I haven't really talked about. That one is interesting. I'd love to explore for a second. And we're going to go into a million different nooks and crannies.

• 41:54Nick Kokonas?

  Yeah, yeah, yeah.

• 41:55Tim Ferriss?

  But do you feel like philosophy was, studying philosophy undergrad was an asset that then later helped you? Or was it just an interest you explored on route to other things?

• 42:06Nick Kokonas?

  I can't remotely imagine having not done that. And the way that actually I did it was really interesting. I had no intention of, when I got to college, I thought I'd study political science economics, pre-law kind of thing, something like that. And my very, like, second week at Colgate University, a wonderful professor, who just passed away last year at 94 years old, really great mentor to me, Professor Jerome Belmath, was a tenured professor at Colgate for almost 60 years, pulled me aside, introduction to logic, you know, 101. And basically said, "What are you studying here?" I told him, and he said, "Nope, you're gonna be a philosophy major. I'm gonna tell you, I'm gonna teach you how to think." There's this great scene in A River Runs Through It where the dad, you know, every time the kid writes an essay,

• 42:51Nick Kokonas?

  like, the young fisherman kid writes an essay, and he brings it to his father to be graded, he gives it back to him and says, "Half is long again." Long before that movie ever came out, Professor Belmath would essentially assign a paper to the class and say it should be about 15 pages. And people would be like, "Well, how long?" And he'd always say, like, you know, "How long is a piece of string? Like, it's however long it needs to be." And then he would tell me, "Yours can't be longer than three pages." And people would be, like, jealous, like, "Wow, you only have to write three pages." If you take it seriously, that is a much, much harder thing to do. So, he really trained me, as well as a number of other professors there, to be clear in thinking, succinct, to, you know, understand what logic was, to process information,

• 43:34Nick Kokonas?

  and really to look for parallels in different fields and different fields of thought. And so, man, like, when I got out of school, I went to law school for, like, a day and a half. I'd gotten into Penn, like, a joint J.D. PhD program at Penn. And as soon as I kind of knew who the other folks were and what their desires and trajectories were, I was like, "Oh, this isn't actually a good fit for me." And I remember my future father-in-law... Told my now-wife, then-girlfriend that I was in danger of becoming an intellectual bum. Because I dropped out of law school before I really entered law school. And I floundered around for a little while. But if you grew up in Chicago, you end up meeting people who had this unusual lifestyle.

• 44:18Nick Kokonas?

  And that was back in the days, pre-internet, pre-electronic trading, pre-high-frequency trading, where there was literally people on a giant trading floor shouting at each other. And you either were attracted to the, I don't know, almost animalistic nature of that. And for me, it was like a huge challenge, because there are people down there that had PhDs from MIT, and then there was people who were like butchers that went down there with $100,000 and just kicked ass. And so it wasn't about your level of education, or any of the stuff I already talked about. It was about, can you show up every day, and every day's game day, and be really disciplined and very clear-headed with chaos around you? How did you get introduced to that world?

• 45:02Nick Kokonas?

  You know, if you grew up in Chicago, you know some of these guys. And some of them are flashy. And I can remember the exact moment, and I'm not going to name a name here, as you'll find out why in a second. But I was walking down the street, I was like, you know, six months out of college, kind of didn't know what I was gonna do. And I was walking down the street, and I bumped into a guy I knew in high school. And, you know, he wasn't the best student, he didn't try the hardest. And I was like, "Hey, what are you doing now?" And he was like, "Well, I'm just rehabbing these homes." And I thought, literally, like, "Oh, he's a construction worker." And I was like, "You know, what are you doing with them?" And he's like, "Well, I just bought this block." And I'm tearing this all over. This is a true story. This is so not like, you know, a good reason to do something.

• 45:45Nick Kokonas?

  But I looked at him, and I was like, "What are you talking about?" And he's like, "Yeah, I skipped college, and I started out as a runner on the floor of the Merc. And now I own like 25 condos and three townhomes, and I trade." And I kind of went like, "Wow, I don't know what..." I knew a little bit about it. I'd been down on the floor before, just visiting. But I was kind of like, "That's fascinating. Like, that is a truly fascinating thing." And, you know, I went down, visited the floor. I had to fake my resume in the wrong direction to get a job.

• 46:18Nick Kokonas?

  It's a true story. Like, people lie on their resume all the time. I'm probably the only person that got rid of my degree and my academic awards and all that, because to get a clerk job on the floor, the last thing they wanted was someone with a good degree, Phi Beta Kappa, you know, magna cum laude, all that stuff. So I faked my resume, got a $5 an hour job, and looked for a mentor. And I found a guy named Frank Zerino, who was at Chicago Research and Trading, who was, which also was founded by a philosophy major. It's actually very common. Why is that common? I wish I knew the answer. I don't know the answer. I do know that there's three or four of the largest trading firms in the world are run by philosophy majors. And if you look back at my class, just of, you know, there's a few professors

• 47:01Nick Kokonas?

  in there, but there are people who make movies. There's a guy who runs an ad agency, a large ad agency. It's a really interesting path. It's not just like studying physics. Like, I know some great physicists who are great in whatever they do. And I think it's a similar discipline of abstract thought. Like, I can't think of anything worse than studying business.

• 47:26Nick Kokonas?

  It just seems like a terrible thing to study to me.

• 47:30Tim Ferriss?

  Is that because it's like the surface of the waves in the ocean, topically, it's just so non-transferable in a sense? And then, as you go lower and lower to the slower-moving layers, that's just more multidisciplinary in terms of studying like the basics of how things work or how people think?

• 47:48Nick Kokonas?

  Yeah, I think it's almost like it's how to do something, or how to manage something, but not why to do it. And so, if you're taught in 1992, if I went and got an MBA, I would have been taught a certain kind of management that six years later with the internet would have gotten blown up. And so, for me, it's like, I always ask the why question. You know, you were mentioning, like, the book publishing, or a bar. You know, I just look at some things, and I just go like, why is that? Why does it work that way? And oftentimes, the people most entrenched in a system have no idea why. They're like the third or fourth generation of person within that system. And they have no idea why a school bell rings in the morning,

• 48:30Nick Kokonas?

  for example, or why a bartender is washing the dishes. And often, I don't know the real answer, but I come up with alternative ones, at least that suit my narrative, I guess.

• 48:43Tim Ferriss?

  Undervalued skill, by the way, in some cases, right? You gotta be careful, but very, very, very, very interesting. I want to pause here partially because I'm over-caffeinated. I was inspired by my nostalgia related to your double espressos. But why did the professor pull you aside? What did that early undergrad professor in logic 101 see in you? Whether he explained it or not later, I don't know. That led him to take a special interest in you?

• 49:12Nick Kokonas?

  I think I was prepared in earnest because I was mostly terrified. You know, he had a reputation of being kind of like a, he is a Socratic method teacher. He was pretty harsh. Colgate was very small classes and there was a class of, you know, 80 people. And he kind of wanted to whittle it down to a more manageable number. And his method to do that was just to kick your ass. And I remember, I mean, he probably, as great as he was, he, I doubt he would survive starting out at a college campus now. I literally saw him light fire to someone's notebook once when he was asking people, like examples of how to put out a fire. And this one guy was just stuttering because he was so in fear. And so he just lit his notebook on fire and he stamped it. And the kid threw it on the ground, stamped on it. He's like, you could smother it.

• 49:57Nick Kokonas?

  Sure. And he called everyone, he memorized every person's last name and it was Mr. And Ms. And I remember the specific day, he was literally back to the, this is like right out of a movie. He is back to the class, writing on a chalkboard, some logic problems, symbolic logic. And the guy next to me had no shot at getting it, none, right? He said his name and I wrote on the paper on my desk so he could see it, like what the answer was. And then without missing a beat or turning around, he was like, Mr. Kokonas, please do not help him. There is no way in hell he could possibly have done that without your help. And this is like two or three weeks in, right? And he spun around and he saw that I didn't have my book.

• 50:40Nick Kokonas?

  And he said, Mr. Kokonas, where's your book? And I said, it's at my, it's in my dorm room, you know, professor. And he said, well, a lot of good it's doing you there. I said, on the contrary, it must apparently be doing me a lot of good there. And he said, I'll see you after class. So I thought I was getting kicked out. And there was like a line forming to create office hours or to like ask to be transferred out or whatever. And when I got to the front, he said, follow me. And I followed him to his office. And I swear, I mean, he's running through the fall, New England fall. And I thought I was going to get kicked out of the class. And when I closed the door, I turned around, he has feet up on the desk. And he said, where are you from? What do you want to do here? And that was it. He took me under his wing. I was very fortunate. I, and you

• 51:25Nick Kokonas?

  know, it's like, I never knew, here's the amazing part. I never knew the guy liked me until 10 years after I graduated. And then I was treated like a member of his family at his funeral 30 years later.

• 51:35Tim Ferriss?

  Huh.

• 51:36Nick Kokonas?

  Right? So really fascinating person, really fascinating moment in my life where, I don't know, someone saw something in me and kind of went like, I'm going to make an investment in this person. And never asked for anything back, you know, ever.

• 51:48Tim Ferriss?

  How did you not know that he liked you? Did he withhold in some way so that you wouldn't get a big head or something along those lines? Did he not want to get overly attached to you so he wouldn't express?

• 52:01Nick Kokonas?

  No, no, no, no. I think I was 19 years old and I didn't know that people you like, you hold to a higher standard, probably.

• 52:07Tim Ferriss?

  Right.

• 52:08Nick Kokonas?

  And so consequently, he beat the shit out of me in a good way. You know what I mean? It's like, if you have someone who's teaching you something and they invest their time in you, and they think you have a chance of being good, they work you harder than the folks around you. So the people that I thought he liked, he was just being nice to you because they didn't, he didn't think they had a chance.

• 52:27Tim Ferriss?

  Right. Yeah. He didn't care. It wasn't invested.

• 52:30Nick Kokonas?

  Yeah. And, and so with me, I think it would be like, he would be talking to my English professor without me even knowing and being like, that paper sucks. He can do a lot better than that. Give him a C on that one. I was like, what's going on? Like all of a sudden that class got hard. I didn't know. I like, I had no idea. And it was just, it was an interesting, lucky, fortunate place to be at that time.

• 52:53Tim Ferriss?

  So we're going to get back to the Merc. But before we do, philosophy. I'm endlessly fascinated by philosophy, but I'm also a nerd and kind of academic and pedantic, and I've spent a lot of time in school. For people who are listening to this who are, say, already in their careers, or maybe they're in their early twenties thinking of starting a company, but are entrepreneurially either involved or inclined, would you suggest if they don't have any exposure to philosophy that they read any particular books or resources or explore it in any way? Or would you say, actually, you know what? That was an intermediate step to something else. You would probably be better off studying X, Y, and Z. Is there like a starter kit or something you would recommend to folks

• 53:36Tim Ferriss?

  who don't have the philosophy exposure?

• 53:39Nick Kokonas?

  I think part of it is if you read a book in isolation, it's not as rich of an experience as discussing those ideas within that context. That said, if you're the kind of person that loves to read and explore ideas, I mean, there's hardly a better place. It's a matter of finding what you enjoy. I happen to love The Problems of Philosophy, which Bertrand Russell wrote, sort of about Wittgenstein's ideas, but before Wittgenstein published. And it's written in plain language. It's not hard to understand. Certainly Nietzsche is more like philosophy with some weird sugar coating of something on top of it. And man, like as a young male, you know, reading Nietzsche for the first time, I was like, fuck, yeah.

• 54:24Nick Kokonas?

  You know, like, it's not like, it's not passive. Like, I think people think of philosophers as like Zen monks sitting there quietly contemplating the universe. I think what it is, is it's people grappling with all the same questions and curiosity that we all have if you pause to think about it. And so it's so big. It's not just Descartes, you know, I think, therefore I am. It's kind of every little bit of that. Back to like, read Lucratus. He had the atomic theory of the universe.

• 54:53Tim Ferriss?

  Could you spell that? I'm gonna be the first one to admit that.

• 54:55Nick Kokonas?

  Lucratus? Oh, I can't.

• 54:56Tim Ferriss?

  Oh, Lucratus, Lucratus.

• 54:57Nick Kokonas?

  Yeah, Lucratus, yeah. I mean.

• 54:58Tim Ferriss?

  L U C R I T I U S.

• 55:00Nick Kokonas?

  Yeah, I'm a terrible speller. So never ask me to spell anything.

• 55:04Tim Ferriss?

  We'll put it in the show notes.

• 55:05Nick Kokonas?

  Yeah, right, right. But like, you know, it's like, you read, read that or read this great book called The Swer, which is about this monk ages ago that sort of found that book and then rewrote it and saved it for history. Like, that reads like a murder mystery. Like, you don't necessarily need to start with the philosophy. You can start with the things around it. I continue to. Find sort of the world of ideas endlessly inspirational. And then, by the way, steal them and use them in whatever you're doing. They're there for you.

• 55:38Tim Ferriss?

  Lucretius, L U C R E T I U S. Titus Lucretius Caris was a Roman poet and philosopher. We'll put that in the show notes. The, I want to second Bertrand Russell also. I haven't read Bertrand Russell in so many ages, but it is very digestible. It is not dressed up in $10 words when 10 cent words would suffice. A lot of his writing is really powerful. I also just wanted to mention for folks that, and I just thought about this. Ages and ages ago, I felt like I had certain gaps in my education after college. And I ended up, I don't know why this didn't occur to me earlier, but somebody

• 56:23Tim Ferriss?

  mentioned that Stanford, UC Berkeley, these top tier universities all had extended or adult education classes taught by professors and junior professors. I mean, these, this is the same team who's teaching.

• 56:38Nick Kokonas?

  Yeah, yeah, yeah.

• 56:39Tim Ferriss?

  And those are very readily accessible.

• 56:43Nick Kokonas?

  Well, and even MIT OpenCourseWare.

• 56:45Tim Ferriss?

  Yep.

• 56:45Nick Kokonas?

  So many colleges now have taken that model and put great, great, great classes online. And, you know, I know that every now and then I'm surprised what I find on there and get sucked into like an all nighter of taking some college class, you know, that I know nothing about and it's so far over my head, but it kind of refuels you again to go like, oh, like there are huge gaps where I know nothing. And the older you get, the harder it is to start into something new, I find at least, because it feels like the mountain's too big, you know?

• 57:22Tim Ferriss?

  I would actually, not to pull a Nick, actually, sir.

• 57:26Nick Kokonas?

  Yeah, you disagree.

• 57:26Tim Ferriss?

  On the contrary, on the contrary, sir. My book is doing me a lot of good in my dorm room.

• 57:32Nick Kokonas?

  That's right.

• 57:32Tim Ferriss?

  I think one of your superpowers is that. You ask the fundamental why questions about longstanding assumptions or conventional wisdom in different fields, and the more you have done that, the more obvious it is to you to do it as a starting point in a way. Let's go back to the Merc. We can go in any direction, of course, but

• 57:56Nick Kokonas?

  Yeah, yes.

• 57:57Tim Ferriss?

  You step into this Lord of the Flies slash gladiatorial arena with butchers and PhDs and so on. Then what? Like, at what point is there a point when you're like, okay, I actually do think I could be good at this?

• 58:14Nick Kokonas?

  No.

• 58:17Nick Kokonas?

  I, for real, no. I was down there and I, I had made a fatal error of leaving school. And everyone told me it was a fatal error. And

• 58:27Tim Ferriss?

  This is leaving the law school.

• 58:29Nick Kokonas?

  Yeah. And, and I, I remember being down there and, you know, what I was doing was so brainless. It was literally, you take this piece of paper over to that guy and then that guy would yell at you and you would rip the paper out of your hand and then you'd go get another one. It was literally that brain dead. And I was desperately looking to learn what was going on around me. And of course, I bought books on finance and commodities and options and all that. And they were completely ridiculous and opaque and academic that, and they looked like they had no relationship to what was going on there at all. I started taking classes that were run at the Merc on mock trading and just learning the hand signals and things like that, which were fine, but didn't really

• 59:10Nick Kokonas?

  teach you how to trade. And I spent, you know, time interviewing with big companies like Goldman Sachs and Societe Generale and whatnot, because I did have the academic background where I would get the interview, I would be able to take the test, I would do well on their math and psychology tests. I would get offered a job as a trader and then I would look at the contract. This is a key thing. People get out of college, they get offered a job. I think I'm the only one who ever read the employment contract. And what it said in there was basically like they could do anything they want with me for three years. Like, I don't even necessarily need to be a trader. Like, that's what I was interested in doing. But they could ship me to France and have me do something totally different. I could be an analyst, or, you know, god knows what. And so when I would question that, they'd be like, "Man, you should be really happy.

• 59:55Nick Kokonas?

  Like, we had, you know, 300 applicants for this and we offered eight positions. Like, just take it." And I was kind of like...

• 1:00:03Tim Ferriss?

  Totally your style.

• 1:00:04Nick Kokonas?

  I'd be remiss not to say that, like, my dad modeled... My dad was an entrepreneur by necessity because his dad died when he was really young. He fought both at the end of World War II. He was drafted into the Navy at the end of World War II, was dismissed honorably after 16, 18 months because they were downsizing the Navy. And then he was barely young enough to be drafted into the Army for the Korean War. And when he got out, like, you know, he had no usable skills. So he went to work at the grocery store that he started working at when he was 12 years old, saved up all of his money from the Army and the Navy, and bought the store. So as I was growing up, you know, my hero was my dad, who was not an academic, who was not what people would think of as like an executive in a suit or whatever, but did really well.

• 1:00:48Nick Kokonas?

  He had bought property and real estate. He owned a temporary labor office that supplied unskilled labors to factories and conventions and whatnot. That was a really good business, you know? And he had a lot of common sense smarts. He was horrified that I didn't go to law school, you know? But meanwhile, I was modeling what he did. And so when I got down there, I was like, "You gotta own... You have to own your own situation." And so when I was offered those jobs, I was like, "Well, I don't really see myself working for someone else." And I found a guy who also felt that way, and he was working for a big company, and they didn't want to make him a trader because he was too much of a quant. Like, he was really well-educated, he was really mathematical.

• 1:01:32Nick Kokonas?

  He wanted to prove them wrong, so he took a small amount of money and started trading currency options. And when I found him, I instantly knew that this was the right person, because I had talked to dozens of people and no one was like him. And then he said he didn't want to hire me, like he didn't want to hire anyone. How did you meet him? Do you remember how you guys met? Yeah, I was just introduced to him through, he was, back then, there were, you know, if you're a trader, or even a trading company of a clearing firm, like Goldman Sachs, at the time, there was a company called First Options, and he cleared First Options. And back then, you would literally have to take the elevator up to keep punching all of the cards into like, a computer that was 17 floors away. Wow. Ancient times. I met him through being introduced to him there. After talking

• 1:02:17Nick Kokonas?

  to him, I knew he was the sort of geeky intellectual that I needed. And then when he told me like, that he didn't want to hire me because he just hired some clerk, I was like, no, no, no, no. Like, I will pay you to work for you. And he was, he was like, this is really strange, you know? And I explained to him what I just said. It's like, I've been here six months. I set a goal for myself of getting on a badge, it was called, like, leasing a seat and actually trading within a year. And I was like, I need to get going on this. Like, I need someone that's going to teach me options. And it's fascinating, because he then hired me for, I mean, I want to say it was $400 a week, or something like that. You know, I stood right next to him, all day, every day, and he taught me

• 1:02:59Nick Kokonas?

  options theory from scratch, better than any college ever could, to the point where you're looking, you know, three derivatives in, such as volatility curve, but the curve of the curve. And, you know, as soon as I started grasping this and going deeper down that rabbit hole, the more I liked it as a puzzle. It wasn't, certainly the money had an appeal, but it was also, hey, here's this, this giant competition, it's like playing a huge multifaceted chess game, that no one's going to get exactly right. But like I said earlier, it's about making hundreds of decisions a day. And even when you get 10 in a row that come up tails, you know that the next one's 50/50, you know? And

• 1:03:44Nick Kokonas?

  That discipline was interesting. That was more about teaching yourself the psychology of standing there while everyone told you you were wrong, or you were physically small, or you were too educated, or too serious. I mean, you can't imagine how much of a fraternity house that place was. Everything in Wolf of Wall Street, I have seen. I haven't lived, but I've seen it all. Yeah. And I started hiring very shortly after. I started trading, and about a year later, I left and started my own company with almost nothing. And I hired my first employee, who became my business partner for the last 25 years. And I taught him what I learned.

• 1:04:29Nick Kokonas?

  And I hired people that I considered corporate refugees. People who worked for companies and decided that independence was better. Why did you leave after a year? He was moving over to the Chicago Board of Trade, and I had found a couple of awesome programmers to help build this options analysis software. And he sort of offered me up to run some of the operations at the Mercantile Exchange when he went over to trade the bonds at the Board of Trade. And, you know, I mean, he was a really, really smart guy, and he made me a deal that when you analyzed it very carefully, got worse over time.

• 1:05:09Nick Kokonas?

  And I just kind of went, you know, it's been great, and I've learned a ton, and we've made each other a bunch of money, and it's a win-win. But I really wanted to do my own thing. Like, I wanted to be the captain of my own ship, I guess. And thankfully, this guy, Jim Hansen, who's still one of my dearest friends, sort of had an option to stay with that company, or come at a completely underfunded company. I mean, thinking back, it was so stupid, you know, from a risk perspective. But it was asymmetric, you know, far more upside than downside. It worked out really well, and we spent most of our time, as we hired people and taught them how to do this, it was mostly psychology training.

• 1:05:51Nick Kokonas?

  It was mostly standing around after hours and saying, "What's 7 times 28?", and screaming it at each other like a drill sergeant, until the person couldn't remember what 9 times 3 was anymore. And

• 1:06:06Tim Ferriss?

  Wait, why did you do that?

• 1:06:08Nick Kokonas?

  Well, you had to be quick. You had to be quick on basic mental agility.

• 1:06:11Tim Ferriss?

  I see.

• 1:06:12Nick Kokonas?

  So if you bought, if you bought 450 contracts and it was a 20 delta, you needed to be able to do, what's 20% of 450? It's 90, but you need to do that precisely with numbers that are not so round.

• 1:06:24Tim Ferriss?

  Right.

• 1:06:25Nick Kokonas?

  You need to be willing to not be perfect and you need to make that decision instantaneously. And realizing that it could cost you 50 to a hundred thousand dollars if you get it right or wrong. And you have to be really, really comfortable with that. And so what did we do? Well, we stood around and we turned people's brains into mush. Until like literally I had people punch me, cry, run out. No, I mean, it sounds awful, but it was, it's amazing training because the rest of the world moves much slower. So any other decisions that, that I've made in business since then have felt glacial in pace.

• 1:06:58Tim Ferriss?

  Yeah. And There's also something to be said for making the trainer, the training in some or all respects harder than the competition. Right? I mean, the adage of the more you sweat during peacetime, the less you bleed during wartime. I mean, the best competitors I've met in many, many fields often strive to make their training and the toil of their preparation harder than what they expect to face.

• 1:07:26Nick Kokonas?

  That's why we love watching big time sports. When it matters, there are certain people that you know, you can almost look at them and go, oh, that poor person's going to fade. And then you, you hope they don't, right? You hope all that training pays off. When you see someone, I, I love golf for all the same reasons. It's like, you know, just a, a series of constant failures. And then so when you look at someone who, who can pull that rabbit out of the hat, you know, at the exactly the right moment, it's pretty wonderful to see. And, and I, the thing I loved about my time down there, even though I burned out of it after 10 years. Is that there were moments where I did absolutely, I mean, I have friends that they'll listen to this and they'll be like, oh yeah, I remember that time in the S and P bit,

• 1:08:07Nick Kokonas?

  you really got this right, you know, but I made some completely stupid decisions, but mostly on the measure, when things got crazy, I was able to perform more than not. I remember like Greenspan's irrational exuberance speech was like a formative moment where I kind of went, wow, I can actually, I can not only hang in this environment, I can thrive in it. And, you know, you get home soaking wet with sweat. It was a physical job. I guess of people, it was really blue collar in a lot of ways. And, you know, it's like, I got home that day and I was like, that was what I prepped my last six years for. It was very satisfying. It sounds like an awful, it is an awful thing in a way, right? Like

• 1:08:47Nick Kokonas?

  it's just about pure commerce. It serves a purpose of price discovery and all of that, but any individual person isn't really the one doing that, you know? So I think that there are negatives to the whole system as well in hindsight, but man, at the time, it just felt like great mental training.

• 1:09:04Tim Ferriss?

  What would you recommend to people who are listening and are having this flashback to the introductory text exchange about beating the market over a long period of time, who are hoping to become better investors? And you can take that anywhere you want, but are there any particular tools, mental models, anything that you would recommend?

• 1:09:27Nick Kokonas?

  It's really, really hard. I think the mental model is asymmetric risk. I always look for something that the, the upside is, you know, three to four X the downside. Obviously quantifying those is very difficult, but that's the key. Everything I try to do is asymmetric. And then even though Nassim Taleb is a bit of a pandemic goofball on Twitter, his book Fooled by Randomness is awesome. That was the one that preceded Black Swan. And I think Black Swan's great. It's fine. But Fooled by Randomness is, I think, the better of all of his books because it, it just encapsulates everything that people price things incorrectly. All you have to do is walk through a casino. Yeah, you walk

• 1:10:09Nick Kokonas?

  through a casino and you see everybody pricing their outcomes incorrectly. The entire city is built on that. You know, if you could get in your head.

• 1:10:17Tim Ferriss?

  Literally, literally.

• 1:10:18Nick Kokonas?

  Literally, yeah, literally. And I don't take any pleasure like people like, oh, you must have, you must love gambling or whatever. And it's like, I would never sit down to a blackjack table because I know that, you know, there's a forty nine and a half percent chance that I'm going to win and that's the wrong way.

• 1:10:35Tim Ferriss?

  Yeah, yeah, the full randomness has come up a number of times. I haven't read it in ages because it is one of his earlier books. But, you know, Howard Marks also brought this up recently when I was chatting with him. And it is an exceptional book, I think, for developing a new lens on life, not just investing. When you are investing for yourself now, how do you think about risk? Because this is a word that has popped up a few times. How do you personally think about risk in your life? Do you, for instance, like some startup founders, look at the risk as the various early stage startups, restaurants, bars and so on that you're involved with? And then you play it safe in your other kind of asset allocation?

• 1:11:18Tim Ferriss?

  How do you think about risk in, in your life or in investing?

• 1:11:22Nick Kokonas?

  That's a pretty difficult question. I think that, yeah, I think that if you look at everything that I've, I've done business wise, everybody would say that the failure rate is super high in what we do. So trading, they used to say one out of a hundred people that goes down there breaks even their first year. And fewer out of that one, take another hundred of those ones and less than one in a hundred of those becomes a millionaire. And I went, great. It's like the old Jim Carrey, so you're saying there's chance, you know? Right, you know? And, and, and then, and then you go to the restaurant business and people, oh, yeah,

• 1:12:05Nick Kokonas?

  ninety five percent of all restaurants go out of business in their first two years. And I'm like going, great, you know, that's, that's perfect.

• 1:12:12Tim Ferriss?

  Why do you, why do you have that response?

• 1:12:14Nick Kokonas?

  Is it because? Yeah, so and then I'm going to start, I'm doing a software startup now.

• 1:12:18Tim Ferriss?

  Yeah, go for it.

• 1:12:18Nick Kokonas?

  So. The higher, the smaller the hoop, the more interesting it is to figure it out. And once you're up there and you know how to jump up through that little hoop, there's fewer people playing that game, you know? And, and the other thing is, I remember right when I was gonna start building Olinia with Grant, I was talking to a restaurant owner. And by all accounts, he was pretty successful. He had four or five restaurants. And one of them, I really liked a lot. And we'd go there a lot and I kinda got to know him a little bit. And he said, so you know, what are you up to? And I said, well, actually, I'm building a restaurant now. And he looked at me and said, ah, it's a terrible business. You don't wanna do it. Like incredible failure rate, terrible. And I was like, why did you build the next four?

• 1:13:05Tim Ferriss?

  So whenever...

• 1:13:06Nick Kokonas?

  Yeah.

• 1:13:07Tim Ferriss?

  What did he... How did he respond to that?

• 1:13:08Nick Kokonas?

  You know, no one does. That's kinda like with, you know, we'll get to it, I'm sure. But that's like the way I was with the publishing thing. It's like, hey, man, people keep printing books. And yet I can't figure out any of the information. And yet they're gonna give me like three or $400,000 to write a book. Something's remiss here. Like, you know what I mean? I've never written a book before, but yet someone's gonna write me a $400,000 check. There must be a lot of money on the other side of that bet. And so consequently, like, I always try to look for the high, small hoops. And then I spend my time learning as much as I can. And then I jump through that hoop. It's both more interesting, I think. And I also think, getting back to the asymmetry of risk, those are the ones that, yeah, you might have a... Well, first of all, do you really have a 95% failure rate if you put in all that effort?

• 1:13:52Tim Ferriss?

  Yeah.

• 1:13:52Nick Kokonas?

  I don't think so. You know, so I think they priced it wrong, so to speak. And then second of all, man, that's, that's where the fun is. That gets you up in the morning and going to work.

• 1:14:02Tim Ferriss?

  Yeah, yeah. This is, this is where, among many, many other places, averages can be very, very misleading. Right? And I always end up in public Q and As and things of this type, hearing various numbers and stats thrown around, many of which I think have no basis on any data whatsoever. But there's the, we only use 10% of our brands, not true. There is the nine out of 10 startups fail within the first year, or whatever the stat is. And... The first question that occurs to me with a number like the ladder, or I guess a ratio is, well, is it because the model is difficult?

• 1:14:45Tim Ferriss?

  Is it because startups are inherently that high risk? Or are there other plausible explanations? Is it that nine out of 10 people who attempt to start a startup don't do any of the necessary due diligence?

• 1:14:59Nick Kokonas?

  Correct. Yes. Yeah. You know, I've been on a couple of like graduate school, you know, entrepreneurship, you know, contests and whatnot. And one of the things that always happens there is what I call like the time machine. Someone comes up with a business plan that is like, you know, I'm going to build a time machine. Now, of course, it's not really a time machine, but I have seen ones that define laws of physics, for example. Or, you know, new pipeline technology, but they have no idea, like it's just a pipe dream. They've done none of the engineering. So you kind of look at that and you go, you haven't really done the homework yet at all. And then there's a lot of people that come to me and they've spent like six months doing their logo

• 1:15:40Nick Kokonas?

  and the name of the company, but they don't actually have a piece of software yet.

• 1:15:45Tim Ferriss?

  Right.

• 1:15:46Nick Kokonas?

  I'm just going to hire someone to build that for me or an app. Yeah, I get so many apps pitched to me and, you know, they don't know how to build an app, but they've got a logo and an idea. And I was like, that's a good way to blow a half million dollars on a consultant.

• 1:16:03Tim Ferriss?

  Oh, man.

• 1:16:04Nick Kokonas?

  You must get all, you must get that 50 times worse than I.

• 1:16:07Tim Ferriss?

  Yeah. I mean, what I tend to get, and this is part of the reason why I stopped all the startup stuff a couple of years ago, is it got to the point where 90% of the pitches I received, which were unsolicited, would be along the lines of, hi, comma, like not even a first name, or be like, hi, Tim, or hey, Tim, even better. I am the CEO or co-founder of X. We are raising this at this valuation. We are oversubscribed, but we could squeeze you in for 25K if you're really interested because we admire ABC, hear the docs attached.

• 1:16:42Nick Kokonas?

  Yeah, right.

• 1:16:42Tim Ferriss?

  Let us know if you're interested in the next 60 minutes, which my default response to anything like that where people are pressuring me for a fast decision is no. Like, it's just,

• 1:16:52Nick Kokonas?

  Yeah, correct.

• 1:16:53Tim Ferriss?

  It's like I've lost very little money saying no to those things. But coming back to the examples that you were giving and what we were talking about, bridging over to restaurants and food, you're being told how restaurants are an awful business. Food is an awful business. And I remember someone told me a long, long time ago, they're like, yeah, if you want to lose money, go into magazines or restaurants. And at what point, I have a little bit of the backstory, but not all the details. Like, at what point do you decide to go into or get involved with restaurants and why?

• 1:17:28Nick Kokonas?

  I left trading in about 2002. 2001 was a tough year between 9/11, which was my father died in February of that year. I was burnt out after going really hard for so long. And we'd built up a pretty good sized company too, and I merged with a firm in New York. And I just, I kind of needed a break, but didn't know how to really take one at the time. And so I left, I left trading and I immediately kind of panicked because here was something that I really genuinely enjoyed, but didn't kind of know what I wanted to do next. And started doing consulting for a small hedge fund. And then I just didn't know what to do. And I had an awesome wife and a young son and things were good, you know,

• 1:18:13Nick Kokonas?

  but I was kind of panicked. I was playing golf with like, you know, ex-athletes because who else is 34 years old and can play golf on a Wednesday afternoon? And so it was just a weird thing. And I kind of looked at them and I'm like, oh, they don't really seem all that happy, even though they've got this lifestyle. And so I met Grant Aketz, the chef, at Dwell Dining and Trio. Went to a lunch there one afternoon that some friends set up. And it was a transformative experience. It was artistic. It was intellectual. It was thought provoking. Most of all, it was emotional. And those are all things that I would never have associated with eating a dinner, right? And so from from a perspective of like, great art experiences, like seeing a

• 1:18:58Nick Kokonas?

  great movie, or a great play, or going to an amazing museum opening, we kept drawing back there. Like, we kept going back. And we would go back so frequently that it was absurd, because, you know, it was a big meal, and it wasn't cheap. And every time we'd go somewhere else, we'd go like, wow, why are, why is no one else thinking this way? And as I got to know Grant a little bit, I think, like, sometimes people bring, you know, the chef some wine, or beer, or whatever. And it's like, that's kind of sand at the beach, you know? I would, I would bring him books. And I didn't figure he had a lot of time to read. So I would put, like, a Post-it note on a page of an old book. So I remember, I brought him this book called The Peregrinations of an Epicure.

• 1:19:40Tim Ferriss?

  Hold on a second. The Peregrinations, like a peregrine falcon? I don't even know what that word is.

• 1:19:44Nick Kokonas?

  No, no, no. A Peregrination is like a wandering, a bout.

• 1:19:47Tim Ferriss?

  Ah, okay.

• 1:19:48Nick Kokonas?

  So it was written just after World War II by an ex-serviceman. He kind of goes around Paris, I want to say, maybe late 40s, early 50s, I can't recall exactly. And there is a chapter in there on La Permeade, which was a very classical restaurant, kind of the best in the world at the time. And he described a meal there in emotional terms that resonated with what Grant was doing, even though his technique, his cuisine, everything was completely different. And so I literally just highlight, like, a couple lines in there, and give him this book, which was out of print at the time. We kind of developed this email relationship back and forth, where he would sort of try out some new food on

• 1:20:29Nick Kokonas?

  us, and I would give direct, honest feedback, but not like, oh, it was delicious. It was more like, it was more like, you know, you're going for a provocation there, but if, you know. And we would go back and forth. And he wrote, at the time, on a, on a forum called eGullet. And I went on there, and his spelling and grammar notwithstanding, I mean, it was like reading someone who's Just really thinking hard about what they were doing. Everything we just talked about. Here was this young 28-year-old chef from Michigan who looked like Captain America, who would come out not, you know, he was like Hollywood in the sense of like he was good-looking and very driven, very clean-cut. But he didn't look like, you know, the stereotype central casting of a chef, right? You know, chubby, gregarious guy.

• 1:21:15Nick Kokonas?

  He was really quiet and introspective, shy. But then you read, and you know, these, which are still up, you know, you can still Google it, and you'd go like, you know, he'd go on for like four pages about bread service. Like, what's the point of bread, you know? And this is a guy that I could wrap my, you know, wrap my head around. And so I remember on January 20th, 2004, it was my wife's birthday, and she said, yeah, I want to go back there. And we'd never been in the kitchen before, and they have a table there, but we'd never eaten in there. And I remember I emailed him and said, she's ethnically Latvian, speaks Japanese, loves Thai food, good fucking luck. And I knew exactly what that would do to him.

• 1:21:58Nick Kokonas?

  That would put him into 10 days of pure hell. Because he would research Latvian food. He would have to redo, like, he would redo a whole menu, 20 courses, right? And I didn't know they were going to put us in the kitchen. And they put us in the kitchen. I mean, it sounds like a jerky thing to do now, but we did have a relationship a little bit at the time. And he served us like the most amazing meal of my life, you know? And it started out with Latvian sorrel soup with braised ham hocks. And, you know, it had flavors of the sea, which was a Japanese dish. It had Thai dishes, but it was all in his style. And so it was his own, and yet it had elements of all these things.

• 1:22:41Nick Kokonas?

  And at the end of that meal, he said to me, well, what do you think? And I had watched the kitchen, and it was like a watchmaker's shop.

• 1:22:48Tim Ferriss?

  It was not screaming and yelling. It is, it is just as, I'm sorry to interrupt. It is so unlike anything that the vast majority of people listening to this would possibly expect. Right?

• 1:23:01Nick Kokonas?

  Yeah, it's not Gordon Ramsay. It's not Gordon Ramsay.

• 1:23:03Tim Ferriss?

  Right. It is just complete silence. It is like a watchmaking factory. It is, uh, it is really something else. Anyway, sorry to jump in.

• 1:23:12Nick Kokonas?

  Yeah, no, no, no, it's, it's, that's totally fine. And so at the end, I said, you know, I doubt anybody anywhere in the world had a better meal tonight. And he was like, well, well, thank you. And I said, what are you planning on doing with yourself? You know, I mean, I was like, kind of, I had a lot of wine and I kind of looked, I kind of looked at him. You know, he sat down with us and I said, what are you, what are you gonna do? And he goes, well, what do you mean? I said, well, you're not gonna be here forever. And he said, well, I want to build my own restaurant. And I said, I'd be happy to help you do that. And he said, well, what kind of restaurant do you want to build? I said, I don't know. I've never built a restaurant before. That was it. And then like a week later, I got an email with his business plan and I invited him by my house. And a year to the day later of that, that was May 4th. We went back and forth on email. On May 4th, we held a dinner at my house for potential investors.

• 1:23:57Nick Kokonas?

  And on May 4th, 2005, we opened Delinia.

• 1:24:00Tim Ferriss?

  Um, that is nuts in terms of-

• 1:24:02Nick Kokonas?

  Completely nuts. We didn't even know each other.

• 1:24:04Tim Ferriss?

  Can you put that in perspective for people? I actually did not realize that was the timeframe.

• 1:24:10Nick Kokonas?

  Yeah.

• 1:24:11Tim Ferriss?

  I mean, can you, just in the context of like normal restaurant world?

• 1:24:14Nick Kokonas?

  We, we, we argued like, so we didn't really know each other very well.

• 1:24:18Tim Ferriss?

  You've said we didn't know each other very well. What did you know about each other? Nonetheless, that gave you guys the push, like the impulse and the sufficient level of trust slash excitement to actually pursue it, right? There had to be something there. It couldn't just be nothing. So what was it? You didn't know each other well, meaning maybe you didn't know the full scope of each other's backgrounds.

• 1:24:43Nick Kokonas?

  Yeah, I mean, I actually studied that, like that I actually knew, I knew the facts, you know? And I knew what he was putting in front of me, but I didn't know him the way you'd know someone that you're gonna become a business partner with. And I think he just thought I was rich. I'd be serious, like, like, like, you know, I think everyone else wanted, this is, this is really true because he has said this to me.

• 1:25:07Nick Kokonas?

  Everyone else wanted to offer him a restaurant that they had already built or wanted to build. And I actually answered that question correctly. The "I don't know" is an awesome thing to say like 90% of the time of your life. Right? And so when he said, "What kind of restaurant do you want to build?" I could have waxed on about some dream I had or just made some bullshit up at the time. But I just said, "Like, I have no idea. Like, that's a big question. We need to sort that out." And I think that was the right answer for him. I think that's all he needed to know was like, "Okay, the guy's got an open mind. He seems to have done well in business. He knows apparently how to build something." What was really funny is that the stuff that I was concerned about, which was like, architecture, design, plumbing, you know, building, lease, all of that.

• 1:25:52Nick Kokonas?

  He was like, "The word oblivious is not too strong of a word." You know, this is not a criticism of him either, right? It's just like he came to my house and he was just like, "Yeah, you know, I want Martin to design everything." And Martin Kastner, who is a genius designer, has Crucial Detail, which we've been involved with for 15 years now. He's a designer. He's like an artisan. Like, he built plateware and he won the Bocuse d'Or for the platter he designed for Thomas Keller, Daniel Boulud's team for the Team USA and all that now. But back then, like, I mean, this guy's not going to design plumbing or electrical. So I would just look at him going like, "Well, no, we need an architect and you need to get city stamps and all that and all that." So I think Grant was just like, "Yeah, you find a place, you put tables in it, you know, build a kitchen and you go."

• 1:26:37Nick Kokonas?

  In terms of like, obviously, he knew there were health inspectors and all that. But the process of all this, just about, you either were going to not build it ever eight weeks in because we hated each other, or we were the kind of people that figured everything out. And we just talked it out, like, right down to what kind of tables, what kind of glassware, what kind of this. Like, we wanted to rethink the why again of everything. Like, why do you put a candle on a table? Why is a candle romantic? That's a question we asked. Do we need candles? That's kind of like, why is that romantic? Why do people put a little bud vase on a table? Why shouldn't that be an edible thing? That'd be cool. So we did all of that and we designed the experience

• 1:27:19Nick Kokonas?

  to create emotional responses from the moment that you walked in the front door. So we didn't have the podium. We went, "What does a good greeting feel like?"

• 1:27:29Nick Kokonas?

  Not just if you're at someone's house, what does that feel like? If you're at a restaurant, what shouldn't it feel like? Well, it shouldn't feel like a computer in front of your face. Saying, what's your name, you know, and all that. So we, we went through every aspect of that. And, you know, I lost almost 20 pounds that year, not in a healthy way. Just like GCing the construction. I laid tile in the basement like three days before we opened.

• 1:27:52Tim Ferriss?

  Let me pause for one second. So the why question that comes to mind for me is after the finance, after battling it out on the front lines and going through 2001, why this as your next thing? Why, why was this the thing that captured your imagination? Because you had to know on some level, once you started getting into the details, like, fuck, I mean, this is gonna be.

• 1:28:16Nick Kokonas?

  Yeah, it's all in.

• 1:28:17Tim Ferriss?

  This is gonna be a big, this is gonna be all my chips energetically. So why, why this?

• 1:28:23Nick Kokonas?

  You know, there are occasional times when you wake up in the morning and that thought comes back to you that, hey, I'm really sucked into this. Right? You know? And for about three or four months, without telling anybody, even, you know, Dagmar, like even not telling her, like telling no one, I kept going like, I should build a restaurant with this guy. It would be the best restaurant in the world if it was done all the way. And I recognized my inner voice saying, that's a really dumb idea. You know, and you don't know what you're doing. I'd never worked a day in my life in a restaurant. And, and I also recognized, and this is also critical.

• 1:29:03Nick Kokonas?

  I recognized that so many people built their living room after they made some money. So they went like, oh, well, I know how to host a good dinner party. And I know good wine, so I'm gonna build me a restaurant. And then they sit there like it's their living room. And that's not good. Like, I didn't want to be that, that Ducey guy that built a restaurant because my ego was, was needed to host a party. And so whenever I would kind of later on broach that subject and people would say like, "Well," you know, I could almost hear their brain whispering, "Well, of course, that's what he's gonna do." And so that was, again, not the best of motivations in the world perhaps, but the honest one. That was hugely motivating eventually.

• 1:29:46Nick Kokonas?

  But when we first started, it was this nagging thing, like I'd wake up in the morning and I would go, "You know, I'm not really into what I'm doing right now. And I've just met somebody who's the best in the world at what they do. And no one knows it yet." That's probably happened to me, I'm really fortunate, that that's probably happened to me seven or eight times in my life. And when it happens and I meet that person, whoever it may be, no matter what they're doing, I pause, I kind of acknowledge that directly, and then I just go like, "Can we grab a glass of wine or coffee or something?" And that's something worth marking and going like, "Wow, this person's really invested in something." And Grant had every aspect of being that at 28 years old.

• 1:30:29Nick Kokonas?

  And in hindsight, like, it looks smart, but I gotta tell you, it was years before it felt smart.

• 1:30:35Tim Ferriss?

  You mentioned just now that you've met these people seven or eight times who are the best in the world, or potentially the best-

• 1:30:44Nick Kokonas?

  Or among them, yeah.

• 1:30:45Tim Ferriss?

  Yeah, among them. But the key point that jumps out for me is, "And the world didn't know it yet." So my question for you is, that sort of brings to the forefront, in my mind at least, the question of, "What is Nick seeing or feeling that other people are not?" Could you talk to that? I mean, is there a feeling or a particular type of observation, a particular type of detail that you notice in these people that allows you to scout the talent where other people might miss it or not pay enough attention to it?

• 1:31:20Nick Kokonas?

  Yeah, I mean, I think you've written a couple of books about that. It's definitely intangible. I think it's different in every case, but it's interesting because-

• 1:31:32Nick Kokonas?

  You can tell when someone is fully committed, I guess, to their craft, or their art, or their business, or whatever it is that they're doing, their sport. And it's not because they talk about it all the time, though of course, if you push a little, they're happy to do so. But it's more that like, if you look around, like, the vast majority of people are not fully committed to whatever. And I think part of what you do is you try to steer people to find those things that they can commit to, or you can try to lower a barrier to show them like, hey, the commitment's not as hard as you think in this particular area, right?

• 1:32:08Tim Ferriss?

  Right.

• 1:32:08Nick Kokonas?

  But these folks are like, they're all in, they're 99%, and that's what they do, often to the detriment, frankly, of other aspects of their lives. And I guess you get better at noticing them. And I mean, now, like, that's like, boy, I live for that. Like, I love meeting people that, even if it's not something I'm interested in, that are all in. That's an interesting, really, I've never really thought about it that way, but like, it was just very clear to me that Grant was all in. If he wasn't gonna do it with me, he was still gonna do it.

• 1:32:44Tim Ferriss?

  Yeah.

• 1:32:44Nick Kokonas?

  I was a helper. I, you know, over time, I certainly contributed, you know, a great deal to it, not just, he contributed a great deal to business, and then I also contributed to the art, but that took time, you know? But I could tell that he was all in. And that was fun. I mean, it's fun to work with somebody who is basically like, okay, man, if you're not in, like, get out of the way, because I'm still going.

• 1:33:07Tim Ferriss?

  Mm-hmm. And for anyone who has the opportunity, I don't even know if they would have the opportunity, but to watch, observe Grant even for 60 seconds.

• 1:33:22Nick Kokonas?

  Well, Chef's Table on Netflix is great.

• 1:33:24Tim Ferriss?

  Chef's Table. Yeah, great, perfect. So, everybody should have the experience of observing.

• 1:33:30Tim Ferriss?

  Grant working and focusing. It is, I've, I've met a lot of people who are good at focusing, who have abnormal focusing abilities and spending the time that we did together in Chicago and the time that I had to observe Grant is, it is a next level of focus. It's, it's really hard to encapsulate in words. So Chef's Table, fantastic. People should check it out and just watch the level of focus that is permeates the appearance, the air, the atmosphere. It's really something else. To that point, focus. One of the, my favorite aspects of, of speaking

• 1:34:14Tim Ferriss?

  with you and having conversations is the questions that you raised. Candle, not just should we have candles? Like, that's maybe a good question, but it's probably not the right first question. Like, why do restaurants use candles in the first place? Furthermore, why are candles considered romantic? Right? Like, kind of stepping back-

• 1:34:31Nick Kokonas?

  Yeah, basic, basic stuff, yeah.

• 1:34:33Tim Ferriss?

  What are other questions that you asked related to Alenia? Or you could certainly bridge to other, you know, I think it makes sense to chat about Aviary as well. But what are some other questions that you guys asked that people might, might not think to ask?

• 1:34:48Nick Kokonas?

  Yeah, I mean, you know, Grant set the tone for that in our first meeting, not really knowing me. And we started talking, we didn't even know where to start, right? And he said, well, I know one thing. I want to have wooden tables. Like, I want to have bare wood tables. And I said, why? He said, well, why do tables, why do fancy restaurants have white tablecloths? They literally call it a white tablecloth restaurant, if it's fancy. Why? And I couldn't really, I came up with dumb answers. Like, oh, it feels good, or it absorbs like a spill, or whatever it may be. And he said, no, it's because the table underneath is a piece of shit.

• 1:35:26Nick Kokonas?

  He goes, and you know that, like as soon as you say it, everyone goes, oh yeah, I knew that. And you've been at weddings and stuff where you feel under the table and you're like, oh, it's plywood. Right. But if you go to like a really fancy restaurant, you feel under the table, guess what? Also plywood, just a little thicker. And he's like, you know, when you rest your arms on the table, even if it doesn't come forefront in your mind, you kind of subconsciously know that they're kind of fooling you. And he's like, why can't we just have like, black, beautiful tables? It'll show the food grade, it'll show the plate wear grade. And then I kind of went like, well, yeah, but the health department doesn't let you put, in Chicago, doesn't let you put silverware right on the table. And if you put a glass there, the condensation

• 1:36:07Nick Kokonas?

  will form a little ring, and then you have a wear issue. But you'll save $70,000 a year in laundering linens. And so we started going like, well, how do we solve the water problem? Well, you create a fridge that's just above the dew point, 44 degrees, you know, in the winter, maybe a little warmer in the summer because it's higher humidity in Chicago, and you just get rid of ice. So you have these cascading decisions that become part of the art of the place, that some of them start from like a really practical thing, like, hey, we want to have a quality table. And then all of a sudden, you need a little pillow that the silverware goes on, that Martin designed, because you can't put, we didn't

• 1:36:48Nick Kokonas?

  want to have placemats, that's too cheap. So all of a sudden, we had to design like, a silverware holder. So it just became this cascade of like, interesting little art projects that were there for good reasons, and really created a unique atmosphere. And it was like one of those things, like, we never tested it until the day we opened. Like, you couldn't test those things. And the very first guy through the door was, is now a famous chef, Chef Sean Brock of Husk. Oh, fantastic. Yeah. So he was not, he was not yet a chef then, 2005. And he was the first guy through the door. And he wrote this giant blog post, and he gullet with pictures and everything,

• 1:37:27Nick Kokonas?

  you could go see it. And every single thing that we hoped would create an emotional trigger, an emotional reaction, it's almost all there. Like, I remember going home and seeing that the next day and going, wow, that shit actually worked.

• 1:37:43Nick Kokonas?

  And you know, and it's like right down to the front hallway that was, you know, a reversed perspective, you know, stolen from Sherk Cathedral and, and inverted, you know. So all of my interests of architecture and art and science and all of Grant's, you know, food and all that, like, all came together in like a year-long conversation on how to do something. And we really fought with the architect and designers and, and all that, because people would tell us the practical reasons why you needed to do this or that. And we would just go, nope, no host stand. Like, you know, we want to greet people in an open way. And so just little things like that. And then we've taken that on, you know,

• 1:38:24Nick Kokonas?

  through everything that we've done, where we took, you know, seven years, six years to, to build our next place, because we didn't have that idea that kept us up at night again. And so, you know, when we did, then we did it. And I think editing yourself and each other is, in an open way, is really, really painful, but really, really important.

• 1:38:48Tim Ferriss?

  And coming back to something you mentioned, related to the living room, the well-off Yes. who then creates, say, an art project that is not, maybe beautiful, but is most often not a viable business. How did you apply those questions and rethink the business model to make any of this work financially?

• 1:39:16Nick Kokonas?

  Yeah, well, I mean, you don't want to be a dilettante, right? You know, my biggest fear is that it would work in an artistic way, but wouldn't work as a business. And so the answer is, at the beginning, I didn't do much. I handled all of our marketing and PR, like I wrote everything, you know, myself. Really thought about open sourcing the building of the restaurant. You can still go online and see the, the original business plans and what logos we were considering using and the, the test kitchen, which was in my house. You know, we didn't tell anyone at the time, but that was my house at the time. And, and see the development of this restaurant. And I felt like

• 1:40:00Nick Kokonas?

  The open source movement in that way was a good model for what we were trying to accomplish. And part of that was people would say like a restaurant like this can't make money. And, you know, I wrote this little spreadsheet that I called the universal restaurant calculator. And can people find that online? No, no, no, but it's but it would be very unimpressive if they could. But it was it was basically like how many covers per night? I mean, this is back of the envelope stuff. How many covers per night can you do? What's the check average for food? Check average for beverage? What are your food costs, beverage costs, labor costs? What's insurance costs, you know, your lease, your rent, like all those things, right? And I had enough experience with most of those things to at least give good estimates to it. And so what I started doing is I started modeling other restaurants using the universal restaurant calculator.

• 1:40:45Nick Kokonas?

  And I had, again, this goes to the transparency of data. I had real data for only two restaurants. And from those two, I would then make assumptions about restaurants like the French Laundry, where Grant used to work, one of the greatest restaurants in the history of America, certainly. And, you know, I came up with a number that Grant went, there's no way their revenue is that high or they make that much money. That's impossible. And it was really funny because years later, you know, I now work with Chef Keller and he's he's a friend all these years later. And I literally pulled that out one day with Grant, be there and went like, how close am I on this back in 2005? And he's like, oh, you're within like two or three percent, you know? And it's I'm we're talking about back of the envelope stuff. And so, you know, you ask like, where can people start to start a business?

• 1:41:30Nick Kokonas?

  Start in the back of an envelope. Like, one of my favorite exercises is to sit in a restaurant or a small business of some sort and just literally do the back of the envelope. That is the kind of calculation my dad called it the two shoebox method, put me through college, right? Like money coming in in one shoebox, money going out in the other. Whatever's left is profit. You know, start that basic. And we did that. And I didn't really think about the

• 1:41:59Nick Kokonas?

  We did well, but we didn't make a ton of money. Alinea cost $2.2 million to build. I put up a little over a quarter of that myself and found investors for the rest, all of whom I knew. And, you know, in the first year, we did, you know, we made about $450,000 to $500,000 on four or five million dollars in sales. Not a great return, not a terrible return. We then won, you know, Best Restaurant in America from Gourmet Magazine. And I was horrified that we won that, frankly. I remember Grant called me and said, yep, I just got a call from Ruth Reichel. And like, we had some stated goals of like, how would we know if this is a success? And one of the things we wrote down was Ruth Reichel declares it the best restaurant

• 1:42:44Nick Kokonas?

  in America. And we wrote that because in 1997, she wrote, "The most exciting place to eat in America is the French Laundry." And Grant was there and cooked that meal and said that the energy of having someone that he respected so much, because Ruth is just a great writer. She's one of the unimpeachable food critics in the history of America. And having her write that in New York Times propelled that restaurant to its permanent status. I think that can't happen nowadays, honestly, for other reasons. But this is kind of pre-internet, pre-Yelp, all that. And then all of a sudden, we got that and I was like horrified because, you know, one of the goals was completed so early. We would have, we wouldn't have our like, our lodestar, you know?

• 1:43:28Nick Kokonas?

  And so he was like, "Dear God, can you let me enjoy it for like a minute?"

• 1:43:32Tim Ferriss?

  To you.

• 1:43:34Nick Kokonas?

  Yeah, oh yeah. Yeah, he was genuinely mad at me. I was like, "That's terrible." Yeah, I was happy, but I was also like, "Oh no, now what do we do?" We need to find another artificial construct here that like, go after.

• 1:43:46Tim Ferriss?

  Enough of this, I need to find happiness and get this other happiness out of my, out of my face.

• 1:43:50Nick Kokonas?

  Yeah, for sure. Yeah, no, it's about, I really do believe that, actually, that it's often, the process is so rewarding that when you get something done, it can be a letdown. And I wanted that process to go. And then unfortunately, six months later, Grant was diagnosed with stage four cancer and given six months to live. And so weirdly, that was the moment where after he was going through treatment, where I started... Going into the restaurant at night, because remember, I'm not a service professional. I was running the business of the restaurant. I started going in at night and asking really dumb questions again. And, you know, weirdly, our goal was to keep Alinia open for when he came back.

• 1:44:32Nick Kokonas?

  And mind you, he only missed like, you know, 12 days, 14 days of service during really intense chemo and radiation. But he was given six months to live. And when people are in that situation and their livelihood is tied to this restaurant, even despite their loyalties, oftentimes, they just need to find another job. Because they're like, hey, in four months, this place is going to be closed. And in the midst of that, we decided to do our first book, really to chronicle what he had accomplished. Because for him, he felt like that would be his legacy. He thought he was going to die. He was told he was going to die. So in the midst of managing a self-created, self-published book,

• 1:45:14Nick Kokonas?

  and trying to do that differently, and then keeping a dwindling staff motivated, trying to let him know that it would still be there when he got well, all of that, I started going, this place is run in strange ways, man. This industry is not run right. And I started asking like, basic questions, like if we have a waitlist for 100 people on a Wednesday, why do we do 74 people on a Wednesday, but 86 on a Saturday? And the answer was because our incentives were misaligned. You know, the service industry as a whole can't run at 100% every single day of the week, unless they're incentivized to do so. And you could go like, well, yeah, but every server, they'll all make an extra 100 bucks a night or whatever.

• 1:45:57Nick Kokonas?

  But they're kind of going like, look, if every night was Saturday, I'd be dead. It's really hard work, you know? So you need to figure out ways of load balancing that and making every day the same, and you end up way ahead. So from a business perspective, that's when my sort of self-education in this industry came forward. And it came forward in a way that... I think I was less patient with everything because we were also going through this really difficult emotional time. And so consequently, when I didn't get answers that made any sense, instead of being diplomatic about it, I would just be like, well, that's stupid.

• 1:46:34Nick Kokonas?

  You know, and which, which cut some of the normal social filter off. And I'm sure it wasn't a pleasant time to be around anybody. But I also think it was accepted within that environment at that time, because everyone knew what we were going through. And so when we, you know, years, years later, when we finally like, we're kind of like, hey, we've got some ideas to build next in the aviary. That's when I kind of went like, well, we're going to do things totally differently here. And anyone who's not on board, even though they work for us, like if you're not on board all the way in, like on getting rid of normal reservations and not using telephones, on doing all these things. I'm like, you know, we don't have a place for you here. And man, it really works. You know, that was the basis of, you know, I talked to every software company

• 1:47:19Nick Kokonas?

  in the industry asking for their API is asking to build essentially what's options pricing software on top of reservation systems. And OpenTable told me no. And the POS systems told me no. I called theaters and went like, what ticketing system do you use? And all of those told me no. So I heard a single programmer and he and I in six weeks built a really rudimentary booking system. But the first day we turned it on, we sold $562,000 of tickets to a restaurant for the first time. First time ever.

• 1:47:48Tim Ferriss?

  Okay, so pause here for a sec.

• 1:47:50Nick Kokonas?

  I know, we're way ahead.

• 1:47:51Tim Ferriss?

  No, no, no, this is great. This is great. So a few, a few things for folks who are not familiar, API, application programming interface. It's how you can effectively link into someone else's software, POS, point of sale, not piece of shit.

• 1:48:04Nick Kokonas?

  Oh, but it is a piece of shit.

• 1:48:05Tim Ferriss?

  Oh, it may also be a piece of shit. What were the design specs that you were looking for? In other words, before you get to the 500,000 plus?

• 1:48:16Nick Kokonas?

  Yeah, yeah.

• 1:48:16Tim Ferriss?

  The snap of fingers, like, what were you trying to fix? Or what were you trying to create?

• 1:48:22Nick Kokonas?

  So I get a lot of grief for this, for saying this in the industry and in the press. But basically, whenever you make a restaurant reservation, one of the two of you talking is lying to each other. If you think about it, no other industry, form of entertainment, which dining out is a form of entertainment. I know it's sustenance. I know there's so much culture embedded in it and all that, but you could eat at home, right? No other form of entertainment. You just call them up and say, hey, hold a seat to the Bears game, or the Cubs game, or the opera, and I'll show up around 7:30. And then they tell you, yeah, yeah, we'll have a seat ready for you at 7:30. And then when you get there, they go, oh, you know what? Go wait over there for 30 or 40 minutes

• 1:49:06Nick Kokonas?

  because we're running a little behind tonight, you know? The reason that they're running behind is because they overbooked, because about 15 to 18% of the people just don't show up. So they overbook. They also know that if they tell you that they'll really seat you at nine, and you wanted an eight fifteen, you'll just go to the restaurant down the street from them that will lie to them. Right? Right. So they do that, and ultimately, it's just bad all around. It's bad for the restaurant. It's wasteful for food, and it's bad hospitality. There are so many pop culture references and entire sitcom, you know, episodes built around someone trying to get into a restaurant, right? It's absurd. It's completely absurd. And, you know, I looked at our no-show rate at

• 1:49:51Nick Kokonas?

  Alenia, data-driven, tracked it. I looked at our, what we call short-seated tables, like the number of tables that were four people, but only two showed up. And the dirty secret there is, like, people would go like, well, what do you have available? Oh, well, I have an eight thirty for four. Okay, we'll take that. And they never intended to bring the other two people. Well, that's just as bad as a two-top no-show. We only have 74 people in there, and so it's a yield manager, or 74 seats. So it's a yield management problem. And so, we, five to eight percent of our revenue every night was, was being lost to that transaction. That was a non-transaction. And so, I wanted to figure out ways to do two things. One, I want to figure out ways to make it transactional.

• 1:50:34Nick Kokonas?

  Because, again, you asked about Professor Thaler, one of the key tenets is, there's a little bit of skin in the game, right? When, when people have a small vested interest in something, in the outcome of something, or even if I gave you a pencil as a gift, and then 30 minutes later, I want to take it back, you will get so mad, even though you didn't care about that pencil.

• 1:50:52Tim Ferriss?

  Right.

• 1:50:53Nick Kokonas?

  Right? Cause you're like, what was that?

• 1:50:54Tim Ferriss?

  Yeah.

• 1:50:55Nick Kokonas?

  Dude gave me a gift. Now he's pulling it back.

• 1:50:57Tim Ferriss?

  Yeah. It's like the expected, it's like the expected value of a mug. If you ask them how much they would spend to buy the mug versus giving them the mug and saying, how much will you accept to sell it? You know, the differential.

• 1:51:07Nick Kokonas?

  Yes, huge. So, you know, that came to me one day because I, my kids wanted to go see a movie at night that I did not want to go see. And I was really, really like, I would have easily paid 50 bucks to not go to this movie.

• 1:51:21Tim Ferriss?

  Yeah.

• 1:51:22Nick Kokonas?

  And then my wife basically says, hey, well, let's go to that movie. So I go on Fandango, I buy four tickets, 60 bucks, whatever it was. And at like 5:30 night, it's pouring rain and everyone's napping. And they're like, yeah, I don't want to go. And I'm like, get your asses in the car. We're going to the movie, man. Now, I would have easily paid that $60 to not go to the movie. But once I had the sunk cost of paying for the movie,

• 1:51:47Nick Kokonas?

  my psychology totally flipped. And, and I was like, we're going to this movie that I don't want to go to. And I literally irrationally made everyone go to the movie. Like, which weirdly cost, you know, I mean, from an emotional family standpoint, all bad, all the way around, right? So I, I thought about it and I was like, wow, what if people put down a small deposit on times when demand exceeds supply? Like, right? So Saturday night, eight o'clock, great. That's a, that's the best seats at the opera house. Let's see if people prepay for that or put down 20 bucks for it. That's fully credited at the end of their meal. It's not a cover charge. I'm not trying to squeeze people on the actual cost of the meal. I'm just trying to go like, yeah, let's see if people make a commitment. And everybody told me, no, no one's going to do that.

• 1:52:32Nick Kokonas?

  Like, this is not the way it works. But if you look back historically, and this is the interesting part. Again, it's about like digging in deep on something. If you look back historically, restaurant reservations started with the telephone. And at the time that we were starting to do this, the telephone was dying. And I didn't know that at the time. You know, that was eight years ago. But I have a computer in my pocket. And if you ring me and I don't know your number, I don't want to talk to you. I don't answer it. I'd much rather receive like a little piece of text letting me know what's going on than a phone call. Similarly, like calling a restaurant is an antiquated thing to do at this point. But long before the telephone, people got room and board.

• 1:53:15Nick Kokonas?

  And what room and board was literally, it was like you go to an inn and you you get a room for the night. And then, do you need food? Okay, well, you get a board of food.

• 1:53:26Nick Kokonas?

  That was literally it. And you'd prepay for it.

• 1:53:29Nick Kokonas?

  And so there was hundreds of years of that, long before there was a telephone and people called and said, "Yep, I'd like to eat at your restaurant." "Sure, we'll let you in." And so as the technology for the telephone has morphed into, you know, what we all have in our pockets now, I just wanted to update that whole transaction. And so I also wanted to acknowledge that Tuesday nights should be cheaper than a Saturday night. So it has to work in both ways. I always thought Uber could have fixed their their surge pricing issues by having discounted pricing when there was no demand. Like just move pricing in two directions. And if you move pricing in two directions, then like that whole argument goes away. Right. So we did that. We priced out different prices by day of the week and times a day.

• 1:54:14Nick Kokonas?

  So 5:00 PM on Wednesday at a Linea is still cheaper than 8:00 PM on a Saturday. By a lot, by eighty to a hundred dollars a person. Wow. And you know what happens? And this is now we have, you know, hundreds of restaurants doing this on our software called TALK. What happens is people buy the most expensive seats first and the cheapest seats first.

• 1:54:34Nick Kokonas?

  Which is exactly what you'd expect, actually. Right. Because there's some people who are price conscious and go like, wow, this is a really expensive meal. But holy cow, I don't really care if I eat at five o'clock on a Tuesday. Great. Like I can save 400 bucks. And then there's some people that go like, I only eat at 8 p.m. on Saturday. Okay, that's fine. Pay a little more. Or they're attracted to the fact that it is the most expensive. Sure, that happens too. And then there's, there's a whole bunch of tools that over time we built on top of that to sell wine pairings or sell books. You know, we sell 20 linear books a day on checkout with the booking process. That's a ton because we're not going to exit through the gift shop at a linear. It's a Michelin three-star restaurant. So, so like we would subtly have like one book like near the restrooms that people could peruse.

• 1:55:19Nick Kokonas?

  But it didn't say like, buy the book or anything like that. So typically we'd sell like one or two per night. Now on checkout, when you book a linear, it says, hey, would you like to buy a linear book personalized? And 20 people a night get it. That is $400,000 in revenue a year. Yeah, that's incredible. Crazy, right? And it's amazing to me that no one did that beforehand because ultimately people can't buy what they don't see. And people don't want to be upsold inside of a restaurant. There's nothing worse in my mind than, you know, some places that today's special is today's special and it's real. And you, you kind of know that, but sometimes it's just the old fish.

• 1:55:59Nick Kokonas?

  Right.

• 1:56:02Nick Kokonas?

  Sunday night.

• 1:56:06Nick Kokonas?

  We all know niche things and like, I think no restaurant wants to like raise their hand and go, yep, that's all true. Like we were aligned to our customers and, and we're not going to really see you at 8:15. And so I think when I said that, like you can look back through some articles. I remember that there's an article, I think it was in GQ, that they interviewed like a grizzled veteran, you know? And he didn't use his name and said, overbook in a bar to wait in has always worked for me.

• 1:56:31Nick Kokonas?

  And I was just like, how does that not sound like terrible hospitality to everyone reading that? You know?

• 1:56:36Tim Ferriss?

  Yeah, for sure. Yeah, there's so, there's so many systems that have similar overbooking load balancing issues, right? You look at airlines, you look at hospitality.

• 1:56:50Nick Kokonas?

  Yep. My dentist.

• 1:56:51Tim Ferriss?

  Yeah.

• 1:56:52Nick Kokonas?

  I, I have a great dentist. They only do it via phone call or email. And so I have to play a guessing game. It's like going into a clothing store and going like, yeah, I'm looking for a blue v-neck cashmere sweater. Like nah, don't have one. Guess again. Like, it's like, put this shit on display, man. Like, just tell me what day you could clean my teeth. Show me and I'll just go online and hit the button. You know?

• 1:57:17Tim Ferriss?

  When you then debuted the ticketing option, if I'm labeling it properly, how did you prime the pump for that? Was there anything, did you need to prime the pump to have this, what seems like certainly a windfall?

• 1:57:33Nick Kokonas?

  Well, we did. Yeah, we did a, a video where, you know, next restaurant was about a restaurant that's always new, essentially. Like, what's, what's one of the big problems of the restaurant industry? Well, when you open a new restaurant, doesn't matter what it is, people are going to show up for like five or six months. And then after that, you know, you gotta struggle to like get regulars and, and find new audiences and all that. But people like the new, quote unquote. The other problem is, is that our own staff and chefs were the kind of people who, I said to Grant one time, he cooked this amazing French dish for me at Alenia, right in the middle of his sickness, because I had driven down from Michigan. I've never eaten before or after in the Alenia kitchen, but he whipped up this little French dish for me of duck.

• 1:58:18Nick Kokonas?

  And I was like, man, let's open a French restaurant someday. And he went like, eh, we'll get bored after six months. Then I was at one of our chef's homes on a day off Tuesday and he made, he loves Thai food and he made this amazing Thai meal, amazing. And I was like, wow, I had no idea these guys were so versatile, you know? And then it made sense. Hey, these are passionate, amazingly talented people. And it kind of dawned on me like, let's change the restaurant every four months. Like, you know, let's, let's do, and then we dwelled on that for like a year, thinking like it was kind of impossible to do. And then I said, well, like, let's start with a French menu. He's like, well, what does that mean? Like, there's Southern France, there's Loire Valley, there's France, that's the new Val cuisine. And then there's France from like, you know, a hundred years ago, totally different.

• 1:59:03Nick Kokonas?

  And I was like, yep, Paris 1906. I don't need to explain to you what that is. You'd want to eat that. If I said, like, if someone said, hey, new restaurant opening, what's the menu? It's Paris 1906. I'd go like, cool. Like, I want to do a little time travel and see what that was like. And so as soon as we had like a city and a time, we instantly knew, that was the idea that kept us up at night. You know, where we went like, wow, look at all these different places we can travel. And what does that restaurant look like? And how do you create a kitchen versatile enough to make all these different cuisines? And how do you make it not feel like Disneyland? Where one time you have a theme of Paris and next time you have a theme of Japan. So you have to go with like an austere minimalism, you know?

• 1:59:44Tim Ferriss?

  Is there a reason why you chose the year 1906?

• 1:59:48Nick Kokonas?

  You know, I'm doing some research and I may get the exact date wrong because this is eight years ago I did the research. But I believe the Seine flooded in 1908, somewhere around there. And so, Scoffier, like the father of French cuisine, was at the Ritz then. And that was kind of like the height of that era of cuisine. And then after the Seine flooded, that's where you got sort of your brosseries and bistros. Because they had to kind of go to a more casual.

• 2:00:18Nick Kokonas?

  It opened up for more people. It took the price point down, it made it more approachable. And it wiped out dozens of these fancy restaurants. And so like, rent got cheap and all of a sudden like, hey, like, we're going to get this new style of restaurant. That's roughly as I recall it, somebody's going to listen to this and tell me I'm all wrong. But that's where we landed because we could do this Scoffier menu. And boy, we argued about that too. Like, in their blenders then, so like electric blenders. So, I mean, we did like a.

• 2:00:45Tim Ferriss?

  So you wanted to mimic the production?

• 2:00:48Nick Kokonas?

  Well, I did, Grant did not. We were, I remember we were at a, we invited the press to a practice.

• 2:00:54Tim Ferriss?

  Grant's like, hey pal, you don't have to make the food.

• 2:00:57Nick Kokonas?

  Well, partly that, but partly he was like, should we make it intentionally worse than we can?

• 2:01:03Tim Ferriss?

  Yeah.

• 2:01:03Nick Kokonas?

  Because the recipes were really vague. They didn't call for salt.

• 2:01:06Tim Ferriss?

  Yeah.

• 2:01:07Nick Kokonas?

  So in the middle of this press dinner where we had like the New York Times there, we had all sorts of these people there, which I'll never do again, right? That was just a genuine error. Like, and we were still arguing out conceptually what this thing would be. And then we served dinner and, and we were like openly, like he'd come out of the kitchen and we would openly argue about it, you know? And.

• 2:01:30Tim Ferriss?

  This is at the press dinner?

• 2:01:32Nick Kokonas?

  Yeah, yeah, yeah. I remember he brought the soup out and it was like, I was like, oh, they, they must've used the actual blenders, right? Like modern blenders. Cause it was like, the mouth feel was like perfect. And so I was like, oh, you use the blenders, you know? And he's like, the recipe didn't call for salt either, did it? But I, should I have not used that and had it taste like shit?

• 2:01:52Nick Kokonas?

  And, and then I was like, well, maybe you don't know that they didn't have refrigeration then either. And they packed the vegetables in salt as a desiccant. And so they were all pre-salted by the time they get to Paris. And that was it. Like people were just like, these guys don't like each other. But, but that was, that was, that's our method. Like that's what we did, you know? And I mean, to the day we opened, we had those arguments. And then, you know, in terms of the software, like, man, like I didn't sleep for a week. We set it up on Rackspace. It didn't work right. I had never done anything like that before. It was like, no one would help. I think like, nobody would help.

• 2:02:30Tim Ferriss?

  No, when you say nobody would help, you mean competitors, potential, uh, I don't even.

• 2:02:34Nick Kokonas?

  Potential allies, potential, like.

• 2:02:37Tim Ferriss?

  These are people. I got it. Why wouldn't they help?

• 2:02:41Nick Kokonas?

  In the case of OpenTable, they had a monopoly.

• 2:02:43Tim Ferriss?

  Right.

• 2:02:43Nick Kokonas?

  So why?

• 2:02:44Tim Ferriss?

  That makes sense to me. That makes sense.

• 2:02:46Nick Kokonas?

  Um, in terms of everyone else, I think they just didn't get it. But even people within my own company thought this was a fool's errand. Grant, for sure, like he will fully admit this now, thought it was a terrible idea.

• 2:02:57Tim Ferriss?

  Why did he think it was a terrible idea?

• 2:02:59Nick Kokonas?

  Because it's not hospitable. It's not hospitality.

• 2:03:02Tim Ferriss?

  It's not, it's not, it's not, it's low touch, not high touch.

• 2:03:05Nick Kokonas?

  Correct. And hugely the case where all of a sudden the price is different every day, like are people going to get that? And I just kept looking to other industries and I'm like, no one has a problem with it when they go to a baseball game. They're not sitting on the, above the dugout. And then like the guy who's in the third deck back row looks down and go, oh, that guy, like he totally stole that ticket from me. You're like two different price points, you know? And I just feel like people inherently get that without having to explain it to them.

• 2:03:31Tim Ferriss?

  If I may, how far in advance of the opening, were you, were you hoping to launch the software? And when did you end up launching the software?

• 2:03:41Nick Kokonas?

  I launched it about seven hours before the first dinner.

• 2:03:44Tim Ferriss?

  Holy shit.

• 2:03:46Nick Kokonas?

  I hoped to have done it four to five weeks ahead of that. It was literally a one man operation plus me, like one programmer and me. When we launched it, Rackspace, this is 2010, I'm not saying anything bad about Rackspace. It was, I didn't, I probably set it up wrong. 2010, it did not, like it's supposed to auto load correct and self propagate. And it neither happened. I was expecting, we had 17,000 people on our email list that had signed up on the website to like be notified when the bookings went on sale. And I was expecting maybe, you know, 700 show up, like should be fine. And something like eight or 9,000 showed up and everyone just kept hitting the refresh key. And here's another fatal error of stupidity.

• 2:04:31Nick Kokonas?

  And, and this is not the way our software is built now because we have professionals here. But basically my admin login was on the very same server as everybody's public access.

• 2:04:41Tim Ferriss?

  Oh, God.

• 2:04:42Nick Kokonas?

  So I couldn't even go into configure it up. So I, and the good news on this is that I couldn't answer like hundreds of angry emails all at once. So I created a Facebook group for the business, which in 2010, not very many people did. And so if you go back and scroll all the way down to the beginning of that, you'll see me going like, hey, if everyone could please stop refreshing. I can sort this out. And what was really cool is that people felt. Part of something. They felt like, wow, holy shit, this guy is actually doing this himself. Were part of this experiment and were on the inside of it. I got a lot of empathy from the customers, even though they were the ones that were unable to get what they wanted.

• 2:05:23Nick Kokonas?

  And then when it finally started working, I mean, I literally not showered in five days. I had pizza boxes linger. I looked like a bad movie startup thing. I had a beard. I was, you know, just strung out manic. And I remember I called Grant and it was opening day and he said, how many should I prep for? And I said, prep for full, like, cause if not, we'll turn on the phones. But I didn't tell him was I didn't order the phones because I didn't want to have a failsafe.

• 2:05:48Nick Kokonas?

  You'd burn the ships. Yeah, I, I would, I just wanted to make sure it, I, I forced myself to work. So we had no phone line. And when it started working, I would double click, you know, one of the functions was I could double click on a table. And if it was yellow, it was held, the public couldn't see it. I could make it available by double clicking it. It would turn green. And then when it was sold, it would turn red. But the first time I did that to let more inventory out and clearly things were working, it turned red so fast, I thought it was broken.

• 2:06:20Nick Kokonas?

  And so then I went into the credit card processing and saw, oh my gosh, someone bought that that fast. And I called Grant and I said, dude, you gotta come to my house. And he was like, uh, we're opening a restaurant in like six hours. What's going on? I said, as the guy who helped save your life, get in a fucking taxi and come over here because I need to show you something. And he looked at me and kind of went like, what is wrong with you? Right? And, and I took him upstairs to my office and I said, I explained what I just, to him, what I just explained to you. And I said, click on one of those and make it available. And he said, which one? I go, any one in the next month. And he clicked like three weeks out at nine 30 and it instantly turned red. And in another window, I had the credit card thing up and I go, look, Mr. Jones bought that.

• 2:07:06Nick Kokonas?

  And he went, really? And I'm like, yep, there are, you know, 4,000 people waiting for you to do that right now. And that was the moment at which I, I was basically like, this is the best thing I've ever built.

• 2:07:21Nick Kokonas?

  Because, because it was, it was, it was, it was functionally different than any way that anybody was doing this. It wasn't novel. It was just applied in a novel way. And so, you know,

• 2:07:37Nick Kokonas?

  What was interesting is that, of course, the software itself sucked. But as a proof of concept, it was awesome.

• 2:07:43Tim Ferriss?

  Yeah, quick question on that, if you're comfortable answering. How much money had you put into developing the software at that point?

• 2:07:50Nick Kokonas?

  Yeah.

• 2:07:51Tim Ferriss?

  Roughly.

• 2:07:52Nick Kokonas?

  I'm gonna say $115,000.

• 2:07:55Tim Ferriss?

  Yeah.

• 2:07:55Nick Kokonas?

  Roughly.

• 2:07:56Tim Ferriss?

  So in your mind, were you completely confident it would work? Or, and it doesn't have to be A or B, there could be C, D, E, F. Or were you like, you know what, for 115K, or whatever it might be, even if you budgeted for less and it overran, even if there is a 20% chance that this works, is it is worth risking the hours and time? Because it will so completely transform what we're doing. And if it fucking fails, who cares?

• 2:08:23Nick Kokonas?

  Correct. Yeah, the latter one, yeah. Again, it's about the asymmetric risk, right? It was also about this thing that, as I dug into how Alinea ran, there's like things that you can fix and control, and there's things you can't, right? And this was the one that, you know, I would answer phones at Alinea. And I would, it was like being a therapist. People would go like, I would like to, you know, make a reservation on my anniversary, you know, seven weeks from now on a Thursday. And you're like, I'm really sorry, sir, it's totally full. And 100% of the time, they thought you were lying to them.

• 2:08:57Tim Ferriss?

  Right.

• 2:08:58Nick Kokonas?

  And, and, and so consequently, like, I realized that we were saying no to people more than we were saying yes. And that even when we said no in a nice way and took 10 minutes to do so, people thought that we were lying, or that they weren't important to us, or any of those things. And so I felt that transparency was actually more important than the actual money and the actual yield management. I felt like, like allowing people to see the entirety of the inventory was the most important thing. And same thing with, you know, the trading markets. They've moved to more and more and more transparency, more and more speed. This is true across every industry.

• 2:09:42Nick Kokonas?

  And I just felt like, wow, this industry I found myself in was so backwards. And so I just wanted to make the whole thing more transparent. And so even if it didn't go beyond my own restaurants, I was totally fine with that. In fact, I didn't do anything with it for four years. And I didn't really intend on making it, you know, like a software product. I intended on fixing my own problems. And I think often that's where, that's where good ideas come from.

• 2:10:10Tim Ferriss?

  Oh, super often, yeah, the scratching of your own itch. At least you have a market of one.

• 2:10:15Nick Kokonas?

  Yes.

• 2:10:15Tim Ferriss?

  Guaranteed market of one. And I also want to point out, when we were talking about asymmetric risk earlier, and you're like, well, I want to stand to make three to four X what I stand to lose. And if you run the math, and I'm sure I'm missing a lot of subtleties here, but when you said we booked 500 and X thousand dollars and it cost 115, like we're getting very much within the ballpark of that.

• 2:10:35Nick Kokonas?

  Yeah, but I didn't even like, I mean, well, I mean, since then, it's like, we've taken our margins at our restaurants from 10 to 12% to, you know, at times in good months, 20 to 25%. In an industry that over the last five years, if you read, I give a talk called Tuesday is Not Saturday and Some Things You Already Know, But Are Doing Nothing About. It's a talk that I give to the restaurant industry. And, you know, one of the things that, that I point out in there is that there's so many obvious things that you could be doing to improve your hospitality, to improve your booking process, to get rid of food waste. But people tend to just kind of move along because it's a really chaotic environment.

• 2:11:19Nick Kokonas?

  It's hard to make change in it because every day is game day. Like you wake up every day and 100 people are going to come through the door. And if your fishmonger doesn't show up, all you, you need to figure out what to do with that, you know? And so it's, it's not really about the return on that one investment at that one moment. It's more like, you know, a thousand small improvements over time. And, you know, if I look back at that system that I built then compared to what we have now, you know, it's a miniscule part of what it turned into. But it was the seed of an idea, which is more important, which is, hey, let's, let's shake things up. And then I got a great CFO who was at Bain Consulting,

• 2:12:01Nick Kokonas?

  and he, he came on to like, help manage the building of the project of Next. And when he started wanting to build out a business team, I was like, great, run with it. And so we've built out. Food cost analysis that uses Marimekko charts. It's totally different because it's visual and you give that to the chef.

• 2:12:17Tim Ferriss?

  It uses what charts?

• 2:12:18Nick Kokonas?

  Ah, Marimekko. Ah, if you don't know Marimekko, if you get nothing out of this. One of the greatest visualizations in charts that you could like, you know, do in Excel or whatever. Hard to do vocally, but imagine a square where each of your X axis is the percentage of, let's say, food costs. And then each square within there is like, I don't know, meat or produce, but the whole of the square is 100%. The Y axis is 100% of one metric and the X axis is 100% of another. So you could kind of look at any given square and see how much that impacts the whole. It becomes like a big Lego building with different colors.

• 2:13:00Nick Kokonas?

  Um, if you give a busy chef 400 receipts and say, hey, every Friday, look through all these. And, you know, figure out what we're spending too much on, or worse. Hey, your food costs last month were 36% and you have them at 32%. You can't take percentages to the bank. Let's talk about dollars. Let's see where we can save some dollars. Or the revenue could have just gone down that month for whatever reason. It's August in New York. And so it's not really a good way to look at it, but you give this person this, this chart, this Marimekko.

• 2:13:31Tim Ferriss?

  The Marimekko, I'm looking.

• 2:13:33Nick Kokonas?

  This guy's name.

• 2:13:34Tim Ferriss?

  Yeah. It's M A R I M E K K O chart. Is that right?

• 2:13:38Nick Kokonas?

  Again, not good at spelling, but sure.

• 2:13:40Tim Ferriss?

  I think so. There is a Google result, which is how to make a Marimekko chart in Excel. So I'm guessing that's probably it. There's some.

• 2:13:45Nick Kokonas?

  That is it.

• 2:13:46Tim Ferriss?

  YouTube videos as well. So I'll, I'll put those in the show notes for people.

• 2:13:50Nick Kokonas?

  Man, I gotta tell you, like, from a utility perspective.

• 2:13:55Nick Kokonas?

  You show that to a person, you explain it visually, like when you see it, it makes much more sense. And they instantly get it and they look at it and they're like, oh, there's no way I spent that much on facial last month.

• 2:14:05Tim Ferriss?

  You know, and this can be, this can be used for things outside.

• 2:14:09Nick Kokonas?

  Everything.

• 2:14:09Tim Ferriss?

  Okay.

• 2:14:09Nick Kokonas?

  Everything. Yeah.

• 2:14:10Tim Ferriss?

  It's not just food, not just restaurants.

• 2:14:12Nick Kokonas?

  Oh, no, no, no. It's, it's just a great visualization of utility. And like consultants love it. And I gotta tell you, I don't love consultants in general. But, but, but, but if I've learned anything from, from the best consultant that I've ever hired, like who, who is now my partner and CFO, he came up with this. And as soon as I saw it, I was like, how did this not enter my life until my 40th year? This makes no sense, you know? It's just incredibly useful. But I, my point is, is that we, we kind of went through everything in the restaurant and went like, well, what are the biggest spending areas that we can like analyze? And it's true in any endeavor that you're doing. You know, there's no point in looking at, at the dimes if, if you've got something that costs a thousand dollars. Start there.

• 2:14:55Nick Kokonas?

  And that's getting into like our thoughts on our publicity, our PR. Like we don't have a professional PR person and haven't in 14 and a half years. We don't spend money on any promotions other than social media. And then with the social media, we track all of that. We can see what our ROI is on a boosted post. We can see what our ROI is if we advertise on your podcast. You know, those are, that's, that's why these mediums are, are working is because they're measurable.

• 2:15:27Tim Ferriss?

  You know, I, I was looking up just as you were chatting and as I was also looking for Merameco, a quote that I think applies, and you may certainly feel free to disagree, but applies very well to a lot of the breakthroughs that, that you have experienced and also helped to catalyze in a lot of what you've done. And it's a quote from Charlie Munger, who for those who don't know, you should definitely take a look at Poor Charlie's Almanack. He's the right hand, or I shouldn't even say that. He is the investing partner of Warren Buffett. And fascinating, fascinating human being, but one of, one of the quotes of his that I really return to a lot when I think I might be outsmarting myself in some way,

• 2:16:13Tim Ferriss?

  or in general as a reminder, is quote, "It is remarkable how much long-term advantage people like us have gotten by trying to be consistently not stupid instead of trying to be very intelligent."

• 2:16:25Nick Kokonas?

  Yeah.

• 2:16:26Tim Ferriss?

  Right? Because you, you, as you noted earlier, you have these practices that

• 2:16:33Tim Ferriss?

  Are being implemented by otherwise, in many cases, smart people who have just not taken the time to ask, why are we doing this? Why does this exist as a thing? Why does, like you pointed out, it's so obvious, once you reframe it, like you walk into a clothing store and they're like, okay, what are you looking for? Nope, sorry, guess again. It's like, that's fucking ridiculous, right? And yet, that's exactly the way it works in many other places.

• 2:16:59Nick Kokonas?

  You know, once you start down that road of thinking that way, it will drive you a little nutty. Because you can't do every business, you know? And, you know, there's a couple of things that I've got in my back pocket that I'm kind of like, you know, one day I'm gonna arbitrage truffles. Because it's like, there's an opaque market that's absurd. Here's an example, I'm gonna give somebody out there, call me up, because this is a real business idea, and I've been wanting to do it for years, but, you know, black and white truffles, not the kind, not the chocolate ones, but the kind that the dogs dig up in France and Italy, are as expensive as the most expensive drugs in the world. You order them as if it were an illegal drug, and of course, they're perfectly illegal,

• 2:17:41Nick Kokonas?

  but you call up a truffle dealer, and you go like, you know, what do they cost? Well, they're, you know, 650 a pound, right now, for black truffles, 1600 for white. You try to talk them down a little bit, you make sure that you get the best quality, because, hey, we're Alenia, and we will ship you back the stuff we don't like and all that. And then, in an unmarked box, stacked with newspaper, will come 20,000 dollars of truffles. Good for like, a week, by the way, like, not, like, this is not like, a big supply. And is completely opaque, as a market, there is no mycologist touching these. There are knockoffs from, not knockoffs, there's different species and quality, from Australia,

• 2:18:24Nick Kokonas?

  from Tennessee, from, from China, et cetera, et cetera, that they cut into it. Sounds familiar? And it was my, like, we spend a lot of money on truffles every year, and try to figure out what the US market, in the fall truffle season, is worth, you can't. It's exactly like publishing. You can't find numbers, you know? And so, whenever I, whenever I see something like that... I'm like, someone's guarding their, their golden goose, you know?

• 2:18:55Tim Ferriss?

  Right. Whenever, whenever it's a black box, you're like, I feel like I am not on the best side of this trade.

• 2:19:01Nick Kokonas?

  That's right. That's right. And, and that's, that's what I did. You know, I did a closed insider network between the Merc and the Amex to arbitrage ETFs. To get rid of the phone brokers in the middle. That took me like a year and a half to get through the Merc and Amex powers that be. Read like most of the CFTC. So when they tell me it's not like in the rules or not legal or whatever.

• 2:19:24Tim Ferriss?

  What is the CFTC Chicago Trade?

• 2:19:27Nick Kokonas?

  This is the, the federal commodities trading commission.

• 2:19:31Tim Ferriss?

  I see. Okay.

• 2:19:32Nick Kokonas?

  It's like the SEC, but for commodities.

• 2:19:34Tim Ferriss?

  I gotcha.

• 2:19:34Nick Kokonas?

  And yo, again, sit down and actually read that someday. Like what's amazing is that the experts never, it's like, it's like the members of Congress who don't read the bill. And then if you ask them detailed instructions on it, they're like, oh yeah, I don't really know. But the general tenor is this or that. The people who were governing the exchanges had never read the rules. So they would just quote to me, they would just quote to me like, oh, it's against the rules. I'd be like, well, here are the seven volumes. Please show me where, if not, I'm going to do it, you know? And so similarly, like, like truffles, same thing. The booking for the restaurants, same thing. OpenTable had a monopoly. They wouldn't tell you who your customers were. They would sell your customers, they still do to other restaurants. You know, if you're full one night, they'll just send you down the street to a Japanese restaurant down the street. They don't care.

• 2:20:18Nick Kokonas?

  So I wanted to get rid of all that. So I built the software for that. Truffles, I will someday build a truffle exchange.

• 2:20:23Tim Ferriss?

  So you question for you. This is, this is, uh, this is something also for, this is maybe just turning this into a therapy session slash coaching session for, for myself, but I get attracted like a moth to the flame to puzzles and

• 2:20:40Nick Kokonas?

  Oh, I've got a puzzle for you.

• 2:20:41Tim Ferriss?

  No, well, no, no, I don't need any more puzzles. I need no more puzzles. But you, there are many, many black boxes out there. Right. You, you have truffles. And like you said, it's like, all right, what's the market size of the truffle exchange at X point in time? Don't know. Right? Although you guys as one establishment or multiple establishments buy a lot.

• 2:21:05Tim Ferriss?

  There might be a hundred different black boxes like that that you run into. How do you choose the black boxes worth trying to shine light on like a detective? Because it's going to consume energy, it's going to consume time. How do you pick and choose which to go after?

• 2:21:23Nick Kokonas?

  That's like the manic test, right? Like, it's like the one that bothers me the most. Like, I kind of start doing, you know? And then, you know, and then it's iterative from there. Like, sometimes you find yourself in a construction of your own doing that was accidental.

• 2:21:39Nick Kokonas?

  Like, all of a sudden, you know, you kind of opened your mouth and said something like the truffle thing. And all of a sudden, like, well, okay, I guess we're building the truffle exchange. You know, I feel like, I feel like the boring company is like that for Musk. Like, he, he opened his mouth and be like, yeah, just big, big, you know, dig big tunnels. And he's got enough credibility now where some engineers went like, yeah, we could build, you know, we could dig tunnels that are seismically fine. And like, hey, you work for SpaceX, okay, like, let's see if you can build, dig a tunnel. I don't think that was like a business plan, you know?

• 2:22:10Tim Ferriss?

  Right.

• 2:22:11Nick Kokonas?

  And, and he just has a lot of credibility, you know, at this point. I think that to a certain extent, like, a lot of people have a lot of ideas. They just don't dig down that rabbit hole. So, you know, I, I do some as like a hobby. I do some where I kind of have someone that I like within our company and say, well, if you really wanted to be independent and do something cool, like, here's a project. Learn more about this and start researching it. You know, we have 300 and some employees on the restaurant side and about 50 on top. Many of them are incredibly hardworking and intelligent. And when someone says, hey, I want to learn how to be more entrepreneurial, I take one of my black boxes out and say, well, let's see if that's true.

• 2:22:54Nick Kokonas?

  Because this is going to take you six months of independent work without any guidance, and you're going to get tired of it really fast. Or you're going to come back to me and say, hey, you know what? Like, I can't figure out. The total value of the truffle market in the United States. I'm like, yeah, no shit. That's why I asked you to do it.

• 2:23:11Tim Ferriss?

  Now, when you give them an assignment like this, they're like, you know what? Boss, I really want to be an entrepreneur. You're like, congratulations. I'm now giving you a project and A, it's on your time and you're not getting paid for it.

• 2:23:24Nick Kokonas?

  Oh, no, no, no. It's not. Oh, no, no, no. I never, never, never take. Every single intern that works at our restaurants for a minute is paid.

• 2:23:31Tim Ferriss?

  Gotcha. So even, so they do get paid for the black box time?

• 2:23:35Nick Kokonas?

  Oh, yeah, of course. Yeah, yeah. I would never, like, I think one of the things that I really dislike, actually, are industries like where they say, hey, like, you're, you know, you're in college, whatever, you know, be an intern. And then, you know, your parents say, yeah, that's a great opportunity for you to learn something and all that. And it's like, well, you're probably not, if you're not getting paid, you're not being valued, frankly. And for me, we pay everybody. Nobody who's working here, if they're, you know. I do expect that, you know, salaried people are going to work more than just the time here. And I think that people who are passionately curious will be given a problem like that and will come up with interesting solutions to finding out what the answer may be. And that's, that's enough, you know?

• 2:24:21Tim Ferriss?

  So I want to add some sort of commentary on the question that I asked, which is, I think it's incredible that you do pay them for that independent research, which is also acting as entrepreneurial training slash filtering for them. But I wouldn't have judged you harshly at all if you said, no, that's on their own time. And the reason I say that is that if you are going to be investigating black boxes as an entrepreneur, there are going to be periods of time where you're doing it in the evenings, you're doing it on the weekends, you are doing it without a clear road to immediate cash flow, right? So I wouldn't have judged you if you said, you know what, I am paying them full time for their normal job, but if they want to tackle one of these black boxes. That's considered extracurricular time.

• 2:25:05Tim Ferriss?

  So I wouldn't have judged you harshly if you had responded in the negative on that.

• 2:25:10Nick Kokonas?

  Yeah, I mean, I guess, I guess, you know, to back up a little bit, like when there are people who I don't know, who do not work for our company and they call me up and say, hey, I've got this idea for XYZ or whatever. And it's intriguing enough, I will, I will pose some more difficult questions. But they're not working for me. You know what I mean?

• 2:25:30Tim Ferriss?

  Right.

• 2:25:30Nick Kokonas?

  Like, there's, there's a guy who brought me a food product that I, you know, about a year ago. And it was interesting, but not super compelling. And I said, hey, if you did these five things, it would be a lot more compelling for me to be involved and to help with it and all of that. And yesterday I got a box in the mail and he had done not only the five things I said, but said, hey, when I started doing those, these seven other things popped up. Here's where the product is. Here's the people we signed. Here's the airline we just signed to, to carry the product. And I would love to have you still involved, even though we're so much farther down the road than I thought it'd be a year later. That's super cool. Like, I didn't pay that guy, obviously, but there's a person who's truly entrepreneurial, right? And did this on his own time.

• 2:26:16Nick Kokonas?

  But if they're working here, if they work for the Illini Group, if they work for Toc, like, for sure, they're, you know, you could take time during your day, like, doing your normal business. That's a project that we're working on. And, um, you know, we, we also try not to have such harshly defined roles. Not within the restaurant, like, look, if you're a server, if you're a captain, if you're a line cook, you're probably not working on my truffle project.

• 2:26:38Tim Ferriss?

  Yeah.

• 2:26:39Nick Kokonas?

  Just because, like, it's, you don't have to. I mean, realistically, you know, that's not, that's, but on the business side, we certainly have people who, who work in roles as like a lawyer or an analyst or something like that, who want to get involved with our publishing project or who want to get involved with the truffle project or whatever it may be. And, you know, I'm happy to, to pull them in and try to include them. And, you know, like you said, you, you used a word as an entrepreneurial filter. I would say 95% of the time, people filter themselves out.

• 2:27:12Tim Ferriss?

  Right. Yeah, I agree with that. I mean, they're gonna self-select or self-select out.

• 2:27:17Nick Kokonas?

  Yeah.

• 2:27:18Tim Ferriss?

  Are there any particular books or resources that you've found useful on hiring or managing?

• 2:27:25Nick Kokonas?

  God, if you found one, let me know. No, hiring is so hard. I think it's the hardest of all things to do. And I think my style of interviewing people is totally different than it was 20 years ago. We used the word self-selecting just a moment ago, and it's exactly what I do. I kind of bring people in. I let them know what I'm about, what the company is about. They've probably already been interviewed by other people before they get to me. And so at that point, I let them know, like, what are the upsides and downsides of working here? You know, and I kind of let them know what the expectations are. And I tell them, like, people self-select into a job.

• 2:28:08Nick Kokonas?

  And you don't want to come here if you're gonna fail, because that would be terrible. And I don't want you to come here and fail, because that would be a waste of my time and resources, and would also feel awful. It's never good to let go of someone. It feels terrible. So let's see if you are self-selecting in. What do you want to know? Like, I'll be completely transparent about what's good, what's bad, what's good about working for me personally. The fact that maybe you'll never see me again. You know, I mean, it's like a big enough organization where, you know, there are definitely people working here who I don't know at all. But people tend to join organizations where they want to work.

• 2:28:48Nick Kokonas?

  And so I try to make that process, I try to make them be able to say no easier than they can say yes.

• 2:28:56Tim Ferriss?

  What would be some examples of how you do that?

• 2:28:59Nick Kokonas?

  You know, I kind of judge the person by what their pain points are. And so if someone says, like, you know, one of the things I like to ask, you know, which it kind of resonates probably with you, is I say, here were the last five books you read.

• 2:29:15Nick Kokonas?

  And I gotta tell you, that's a really hard question to answer. Because even if you're a voracious reader, you remember like a book from two years ago, but you can't remember the one you read two months ago, sometimes.

• 2:29:25Tim Ferriss?

  Totally.

• 2:29:25Nick Kokonas?

  At least I can't, you know? And so that is a great filter on people because a couple of things will happen. One, the person who's a voracious reader will go like, oh, my God, I swear to God, I read like 20 books this year. Uh, let's see. And they will really start going, oh, I read one like three months ago. That was this and it was about that. And you could tell that they're intellectually curious and, and read a lot. You'll also get a person who goes, look, I haven't read a book in 20 years, but every night I go home and I do woodworking. And that's my outlet. Like, that's where I focus. That's my zen moment. And that's a valid answer to that question, too. You know, like, you don't have to be a reader. Some people will just lie through their teeth.

• 2:30:07Nick Kokonas?

  And they'll, they'll answer what they think is the smart answer to that question. And I don't want that person there.

• 2:30:13Tim Ferriss?

  I read War and Peace and then I went to the Problems of Philosophy and uh,

• 2:30:16Nick Kokonas?

  Yes, yes, yes. That's the four hour work week.

• 2:30:20Tim Ferriss?

  So, so.

• 2:30:20Nick Kokonas?

  Definitely not the right answer. So there's that, and I ask that kind of question. But then like things like, do you enjoy writing? One of my things is like, if someone doesn't like to write, when people ask what I do for a living, I say, I'm a writer. And they go like, oh, you've written a couple of books. I go, no, no, no, I read about 400 emails a day.

• 2:30:38Nick Kokonas?

  And that skill is hugely important right now. If someone doesn't like to write, they're not going to want to work for me. Because when, when they send out an email and I MCC'd on it, and it isn't a well-thought-out little thing,

• 2:30:54Nick Kokonas?

  the answer coming back is like, hey, here's four ways to improve this. And at some point, it'll be like, really? You did that same mistake again? It comes off kind of harsh in email, you know? And so if you're the kind of person that doesn't take feedback well or doesn't want to learn, like, man, I don't, I'm lacking patience for that at this point in my life. And I let them know that. And some people like look at you and just go like, yeah, dude, I don't want to work there. More than I would think, which is great.

• 2:31:21Tim Ferriss?

  Yeah, simplifies matters.

• 2:31:23Nick Kokonas?

  Yeah. And it's not, it's not, it's done with a smile. You know, I'm not like trying to like terrorize people when they come in an interview. And then there's some people that go like, awesome, that's exactly what I want. Yeah, we have everything from like, you know, double PhD engineers to people who've never, you know, attended a university for a minute, but they've, they've self-selected into an organization that people ask a lot of questions. I love that. Like, I can be in a room, I come up with an idea, and everyone there will just be like, well, that's a great idea. There's no way we're gonna be able to do that in the next six months. Because that's not, that's not in our, that's not in our capacity at our size right now.

• 2:32:02Tim Ferriss?

  I think a question on a lot of people's minds and a pain point for most people listening will be email. So you seem to be at least confident in your treatment of email. 400 is a lot of email. Do you have any particular commandments, do's, do nots, times you check, things you check first? Any types of systems or approaches that allow you to maintain a degree of sanity with, with the amount of email that you must receive?

• 2:32:33Nick Kokonas?

  You're gonna hate this answer to this. I am terrible at it. It used to be, not so long ago, that I personally replied to absolutely every single email that came in myself. And I used to have an auto sign that basically was like, if I don't reply to you within five minutes, I'm dead or asleep. And it's the opposite of everything that you stand for. I know that. It's, it's like, I was listening to Jason Fried. So Jason Fried's a friend. I was listening to his, his podcast with you.

• 2:33:11Nick Kokonas?

  And I don't get it at all. Like, I am not, I would love nothing more than, you know, to rework or to not work, you know, work four-day weeks or to have six-week projects and all the stuff that he espouses. He's a friend, he's an investor in one of my businesses, but man, I don't, that's not how I function at all. And I weirdly think that he misses cause and effect a little bit. Like, he has a very successful company, and that's the cause that allows the effect, which is the ability to manage your time really well. I live really paranoid. I'm more comfortable that way. And also, I kind of feel like a weird moral responsibility to reply to the people who've taken their time out of their

• 2:33:55Nick Kokonas?

  day to write us a note, you know, even if it's not like critical business for me. And one of the things I did for about 10 years that I loved doing when we first started Linea is that I would have Google Alerts set up and I would find some blog, you know, that only like some woman and her mother read, you know, and I would reply personally, like, say, "Wow, thank you for the great write-up of Linea." And they would be kind of mind-blown that I found it and, you know, all that. I treated email that way for a long period of time. Unfortunately, now, I can't quite do that. So I do have a bunch of filters and whatnot, but I didn't even set them up. My business partner, Brian Fitzpatrick, who used to be head of Google Chicago, and he's my, he runs the engineering team, he's

• 2:34:36Nick Kokonas?

  the CTO of Toc, he kind of said, like, "Dude, you're slipping, man. Like, you need to create some filters and get some stuff that's directly to you." So he went into my Gmail accounts and kind of, kind of forced the issue for me. So now I can't quite do that. I do wake up in the morning and look at sort of our bazillion social media messages and whatnot, kind of pick a random one and just answer it. Like, I want to be involved in knowing what our customers are asking, what they're doing, what they're saying, what they're replying. Anything that's a complaint actually gets brought directly via email to a complaint tracker that me and Grant see. And so luckily, there aren't that many of those, but anytime you serve 5,000 or 6,000 people a week, you're going

• 2:35:18Nick Kokonas?

  to get, you know, some, something going wrong. But man, I'm terrible at it, honestly. And I've tried, I will tell you a funny thing is that when I go away on vacation, I do try to concoct a

• 2:35:29Nick Kokonas?

  I basically say like, look, I'm gonna be in a mountain or on a boat or whatever. And I'm not gonna be able to reply. And so I would make these elaborate stories up. Almost as like a fun piece of art project as to why I couldn't do it. And so one year, every year, every time I went away, I basically said like, I'm going to visit panda that I adopted. And I'm going back to Chicago. And it ended the year around Christmas time when I went on break with a picture of a baby panda. And a really kind of mediocre Photoshop job of me standing there with the panda. And the Chicago Tribune called me up like three days later going, is it going to the Lincoln Park Zoo? And I was like, no, dear God, it's not.

• 2:36:13Nick Kokonas?

  And the following, there is no panda. That's what I wrote back. That was my entire reply to that. And then the following year, I said, like, I like to talk, as you might be able to tell. And so everyone who knows me knows that I can just go on and on, right? And so I said I was going to a combination of a tantric sex retreat and silence retreat.

• 2:36:33Tim Ferriss?

  Sure.

• 2:36:33Nick Kokonas?

  Sure, eight days to explore my both inner and outer self. And then you know, some elaborate.

• 2:36:39Tim Ferriss?

  This is your out of office reply.

• 2:36:40Nick Kokonas?

  That's my out of office reply. Anybody would get that, right? And so I thought that was really funny. And then about two years later, I bumped into some guy who works for a very big corporation. And they wanted to do some work with the only group. And it was like kind of a consulting project, very lucrative. And he was looking at me really funny, you know? And I said, like, what's up? And he said, well, you know, I really wish we had worked together, but you know, then you went to that sex retreat. I just couldn't get it past everybody. And I was just like, I was looking at him going like, what are you talking about? And then I remembered like four years earlier, my out of office reply. And I told him like that it was kind of a joke, like the panda.

• 2:37:23Nick Kokonas?

  And he did not find any humor in it. And I did, I thought it was hilarious, even though we lost the business, I thought it was really funny. So if you ever get a really unusual out of office reply from me, it's fiction, probably.

• 2:37:38Tim Ferriss?

  I love that. I mean, if you're serious all the time, you're never gonna get the actual serious work done. You're gonna burn out before that ever happens. I also want to underscore one thing, and then I want to ask you about a black box that you and I have talked about quite a bit, which is publishing. The fact that you pick a message to reply to, even if it's one, is really important. And I've noticed this certainly with the audience that I have, listeners, readers, etc. It is not physically possible for me to reply to everyone. It would also be anathema to everything that I'm espousing in many of the books. But I do want to demonstrate that I am listening. And I think that it goes a really long way,

• 2:38:21Tim Ferriss?

  even if you do not personally reply to people, if you are able to prove that you're paying attention. And that seems to resolve a lot, or at least act as a salve for people out there who very seldom feel heard, which does not always necessitate a response. So I just wanted to point out that it might seem like a drop in the ocean, but it actually has much more, further reaching implications when you, when you do it, what you were describing.

• 2:38:49Nick Kokonas?

  Yeah, I, I feel like it's genuine. First of all, I'm always curious. What are people writing about to the restaurants? What are they writing about to me? My LinkedIn profile, basically, like, I don't really read LinkedIn at all. I keep it. I think it's important to have it. But I don't ever read the messages on there. But in my bio, it basically says, if you can find my email address, I will incite this, I will reply to you. And so that gets rid of all of the marketing crap that comes in. But every now and then, I get like, you know, a subject line to the email address that's on there that says basically like, hey, via your LinkedIn bio. And I'll read that and reply. And it just shows me that like, hey, there's an actual human on the other line. It's not just a

• 2:39:32Nick Kokonas?

  marketing thing. And B, like, they really, really do have something that they want to talk about. And so, you know, it's like little things like that are kind of. Puzzle filters, I guess, that I call them, like where I just create like a little bit of a little bit of a barrier. And if you if you're really into it and you really want to talk to me, you can pretty much find me pretty easily. I'm not that hidden.

• 2:39:54Tim Ferriss?

  Yeah, and the detail is really important here. The mini hurdle, I have a friend, I'm not going to mention by name because I'll get deluged, but he is a very, very successful author and journalist. And when he is hiring for different positions, part time or full time, at the bottom of the job description on a job site or wherever it might be, in small print, at the very bottom, it will say, do not send a message on this platform, do not send an email, even though email address given earlier, call this number and leave a voicemail answering the following things. And automatically, he takes the pool of 1,000 people who are going to do the wrong thing and finds the 10 people who are actually paying attention.

• 2:40:37Nick Kokonas?

  Yep, 100%.

• 2:40:38Tim Ferriss?

  So publishing, what is, we didn't really, we didn't really talk much about it, but can you give a little bit, just a tiny bit of background on the aviary? And then some of your related publishing investigations, which I think is is not, I think is not an inappropriate word, if you could give people a little bit of context.

• 2:41:02Nick Kokonas?

  Yeah, I mean, I'm going to back up before the aviary just a little bit and just go like, you know, for a chef, doing a cookbook is something that they dream about if they're a serious chef from the time they're 15. You know, just like if you're a basketball player, you want to make the NBA, or you know, if you're a runner, you want to be in the Olympics or whatever, like to grant to a bunch of chefs, having their own ideas in a physical, beautiful cookbook is kind of a holy grail for them. It's very sacred. And what was interesting is that just before Grant was sick,

• 2:41:38Nick Kokonas?

  We started getting a lot of publishing offers. And the natural inclination was to go to what he knew, which was Artisan Press, which published The French Laundry book, which is one of the best-selling, high-end cookbooks ever. And it's certainly beautiful. It was very revolutionary at its time. I think it was published in about 98, 99, something like that. And the typical publishing deal, like, kind of came into us, which was great that they were coming in. And it was $250,000 to $300,000. And they would basically say, well, out of that, you're going to pay for the designer and the photographer. And you need like a 30-day photo shoot. And, you know, here are the guidelines for how many photos

• 2:42:22Nick Kokonas?

  you want in the book and, you know, to keep costs down and this and that. And I kind of looked at all of that. And all the offers came in within about 10% of each other, which immediately, you know, the hair on the back of my neck, like the spidey sense, the spidey sense starts telling me that something back there is pricing this in an unusual way. And then I started going like, oh, this is actually like the music industry. Very much so. I knew people in bands that would get signed to a record label back in the day. And they would get a quarter million dollar advance. You know, shit, that's, seems like a lot of money, right? And then all of a sudden, all your studio time comes out of that. And you don't recoup another dime until you've sold,

• 2:43:07Nick Kokonas?

  you know, X number of records or CDs, or in this case, books. And then in the, in the contract, it actually said, and the restaurant guarantees that they will buy 2,500 books at half of retail price. And I was like, whoa, whoa, whoa, that's, you know, you're looking at something like $80,000 right there. That goes right back to them, in essence. Like, and then I kind of went like, well, I wonder what a book costs to print. And, I mean, I just called, I asked them like, well, how much is this book going to cost to print? Well, I don't really know. And so what they would do is that they would always have layers of people. So that, they said, well, that's not what I do. Like, I am the person that does this. The lawyers give the contract.

• 2:43:51Nick Kokonas?

  The printer does the printing, like, I- There's always plausible deniability or plausible ignorance. Yes, willful plausible ignorance. Yeah. And-

• 2:44:03Nick Kokonas?

  And so I do what I start doing. I'm like, well, let's just Google that up and see what it cost to print a book. Or how many copies of the French Laundry book sold? How many copies of 50 other books that we wanted to emulate or that we that we thought were well done sold? And man, it's like asking for like, you know, keys to the Vatican or something when you call a publisher and ask them that. They I'm sure you know this, right? You probably know now because you've you've been so entrenched in the industry like you know your numbers and you might know that of some of your colleagues and friends, right? But if you wanted to actually do a meaningful comparison across the industry, it's almost

• 2:44:45Nick Kokonas?

  impossible to do it, even though that there's a company that does that. Then you start trying to reverse engineer it and you go to the New York Times, which you can go to the New York Times website and just look at how is the New York Times bestseller list created? And on their own site, they say it's like compendium of known publishers, like publishing houses, as well as these like top 50 retailers, you know, back in the day. And it's a gamable system, right? Like, the way that publishers want to do it is that they want to ship out all the books at the same time, because that's how they're counted for the New York Times bestseller list and stuff.

• 2:45:17Tim Ferriss?

  I should also know it's not only gamable, but it's also conversely highly subjective within the New York Times. So there there's a lot of wiggle room. In other words, it is not like the Olympics where you're like, okay, clear gold, silver, bronze, video replay. We know exactly how this was tabulated.

• 2:45:37Nick Kokonas?

  So the more that we dug, the more that we got like curious, like more and more curious, a little bit angry, actually. And but Grant was weirdly angry at me because he's going like, well, dude, like, why do you care? Like, you know, it's like, I've been wanting this since I was 15. And I was like, well, look, if this is our budget, it's not going to be the book you want. It's not going to be as good as you want it to be because we're not going to be able to spend six months doing the photography. We're not going to be able to get great pages. We're not going to be able to get a picture of every dish. Like, if what do people cook in a cookbook? Well, they tend to cook those pages where they see a picture of the final dish. Because you know what? It looks delicious. You know what it's supposed to look like. You've got something to emulate at least, right?

• 2:46:19Nick Kokonas?

  And so when we did the specs for the book, I had one of the best publishers in America say, "If you do that book, there's no way you sell more than 5,000 of them. No way. And no one's going to publish it. And you can't use metric. And you can't use a gram scale. And you can't have that font. And you can't have those pictures in full bleed. And it'll cost way too much to print." And so it took about a month and a half before I got lucky. And I called a print broker, who had actually printed, you know, brokered the print job of one of the famous books. And I was expecting that the book retailed for $60. It would cost like 15 to print? 20? I didn't know anything about it. And when he told me it was like $2.23 per book

• 2:47:03Nick Kokonas?

  to print per 30,000, you know, 30,000 copy run. I went, "No way." Like that. And he went, "Well, it's probably less now." Like, he thought it meant it was like too much.

• 2:47:14Tim Ferriss?

  Right.

• 2:47:14Nick Kokonas?

  And, and instantaneously, I went, "Oh, shit. Everything makes sense." And when I would call publishers and tell them this, they would go, "Oh, yeah. But look, like, we did 40 different prints, you know, 40 different books last year. Only five of them did well." And I'm like, "That's your problem, man. Like, I know what we're going to sell well. I don't really give a shit if, if you lost 35% of the time and need to spread your portfolio risk. I'm the one you're spreading it on." Right? So we decided with the linear book, we put together like 20 pages. And Martin made this beautiful stainless steel bracketing system. And we shipped it out to eight different

• 2:47:57Nick Kokonas?

  publishers we liked, two of which were art houses that had never done a cookbook. And they all came back and, and same, all the usual criticism, except for Aaron Weiner at 10 Speed Press.

• 2:48:07Tim Ferriss?

  Yeah. Smart, smart guy, by the way.

• 2:48:09Nick Kokonas?

  Yeah. And he basically said, "I'm going to make you an unusual offer. No advance at all. And we can negotiate. Essentially, we'll just be the distributor. And we'll negotiate out like what that looks like. And we'll help you with the printing. It'll help you with the editing, which we're both really good at." And within 10 minutes, we had struck a deal whereby any of the books that we bought or sold for ourselves for our restaurant, we paid actual printing costs. Not wholesale. Actual printing costs, anything that they sold and distributed through their channels, they would get about 27% of the sale price, which means that we got 73% of that. These are like state secrets, right? Like, nobody tells this stuff.

• 2:48:53Nick Kokonas?

  And so for years, I was walking around with this knowledge where if we sold 100,000 books, say, that would be the equivalent of selling like 500,000 books on any other deal. And we got to control the quality of it. And we won both the James Beard Award for Best Cooking from a Professional Point of View, Best Cookbook of the Year. And we won, I say we, Martin and Laura Kastner, won the Communication Arts Award, where if you're a designer, that's like their annual is like, that's like getting the Oscar, right?

• 2:49:24Tim Ferriss?

  Yeah, similarly, for people who don't know, I mean, the James Beard Awards are also very much like the Oscars.

• 2:49:31Nick Kokonas?

  Yeah, so, so we felt like really vindicated on that. The book still sells, this is eight years later, we still sell 7,000, 8,000 copies a year. And when we did the Aviary, which is our bar, that's a non-bar that we talked about earlier, you know, we started getting all of the same offers again. And this time, it was really easy to go like, huh, just kind of like, oh, like, oh, that's cute. Like, you know? And so I should add that we did, I wrote a book of, Grant and I wrote his memoir together, that we didn't use a ghostwriter, we wrote it ourselves, called Life on the Line. And for that one, we did a traditional book deal. But after our agent kind of got it halfway, I got on a plane, flew out there,

• 2:50:15Nick Kokonas?

  and then brokered the deal myself. And I got a giant multiple of the highest bid by doing essentially a reverse Dutch auction, starting at a really high price and working my way downward.

• 2:50:26Tim Ferriss?

  Can you explain to people just briefly what that means?

• 2:50:29Nick Kokonas?

  Yeah, yeah, so basically, like, here, I'll do this, like, let's say, so I think one of the great problems, like, to solve, one of the black boxes is the agency problem. Let's say you want to sell your house. You put it on the market and the agent's going to get, I don't know, 4% to 5% of the sale price. That's a lot for something that's like your most, biggest investment in your life. But they kind of say, like, they control the information, they control the MLS, all that. Will they, if they're the seller's agent, get the highest price for you? And the answer is almost certainly not. Because they, let's say a house is going to sell for $500,000, they're going to get 4% of that, that's $20,000. If they get $490,000, it's almost no difference to them, 400 bucks

• 2:51:10Nick Kokonas?

  difference. But if they lose the deal over that last 10,000, it's a lot. So they want to price a home so that it sells quickly, so that they can keep their deal flow going. And they don't really care about maximizing their last dollar. Whereas for you, that last dollar is actually like $9,600. It's a lot more money. So what I do whenever I've sold real estate is that I figure out what the intrinsic value is of the house. Like, what's the bare minimum that I'd be willing to sell it for? And I price it just slightly higher than that. And I tell all the agents in the whole town, I will pay you 50% of everything over 10% higher than that. And they all say, oh, that's against the real estate ethics code, or I would never do that deal because it would subvert all my other deals, or whatever.

• 2:51:55Nick Kokonas?

  And then what happens is two days later, you get like a dozen phone calls, and they've priced it like 40% higher. And like, it sells in two days. Yeah. Because now they're actually working for you, right? Well, similarly, I went into that publishing negotiation, and I was kind of like, by the way, the agent, it's probably look up, well, she's great, like, great person. I don't think she even knows that that's what was happening. Do you know what I mean? Like, I don't even think she, she just knows that, like, hey, she was brought up in this, in this industry for this company, and that's the way it works. And she would for sure dispute everything I just said. She would say, I always try to get the highest price. But I went in and I just went like, look, I'm not going to spend my time doing this for X, so I need

• 2:52:39Nick Kokonas?

  four times that. And she was like, there's no way you'll ever get that. You've never written a book before. I said, well, we did the Illiniya book. That's a cookbook. Doesn't count. These are words. So I went to the publishers that all bid on it, and I just got them all on a, on a conference call and just started at a really high price. And every couple of seconds, I went down $10,000. And then one of them blinked and bought it.

• 2:53:04Tim Ferriss?

  What was the?

• 2:53:06Nick Kokonas?

  That's a great way, that's a great method of price discovery. If you think about it, most auctions, even like you go to a charity event or whatever, they start low and they try to get interest going high. It's often the case that if they start really, really high and start going down, people start going like, oh my God, someone's gonna say something like, I would pay that. Someone else must as well. They could be off by a factor of 30% and they'll never even know it because there's only one bid that ever happened. So no one knows how off they are.

• 2:53:31Tim Ferriss?

  No, on that phone call, where you're like, hey, guys, would love to get you on the phone and then?

• 2:53:38Nick Kokonas?

  Publisher. Said so right away.

• 2:53:39Tim Ferriss?

  Well, yeah. So I guess my, my question is, did they know that they were signing up for a Mexican standoff slash?

• 2:53:46Nick Kokonas?

  Yes, they did.

• 2:53:47Tim Ferriss?

  Oh, they did, they did.

• 2:53:48Nick Kokonas?

  Oh, yeah, yeah. So I went and met with them all personally.

• 2:53:51Tim Ferriss?

  Or if you're like, John, I'd love to get you on the phone and it's like, all right, congratulations, guys.

• 2:53:55Nick Kokonas?

  Yeah, you can't, you can't ambush people to a Mexican standoff. Yeah, you can't do that.

• 2:53:59Tim Ferriss?

  Okay.

• 2:53:59Nick Kokonas?

  I mean, you could, it might be fun, but I didn't do that. I went and talked, I created enticement, I, I sold on my ability to actually do it. It was a bit like doing the no phones with the software. Like, I was like, well, if I get a really big contract, I'll have to figure out how to write a book and that'll be a lot of pressure. So I did that and I wrote it and I turned it in on time, which apparently no one does. Very, very rare. But yeah, because when I sent it to them, like on the day it was due, they went, what's this? I'm like, that's the manuscript. Yeah. And they went, oh, that's cute.

• 2:54:29Tim Ferriss?

  Well, it's kind of like showing up at the restaurant on time as a diner and then being seated at the point of time.

• 2:54:35Nick Kokonas?

  Apparently very rare.

• 2:54:36Tim Ferriss?

  It's just this like open, open lie.

• 2:54:40Nick Kokonas?

  Do you turn your books in on time?

• 2:54:41Tim Ferriss?

  I do, actually. Yeah.

• 2:54:42Nick Kokonas?

  I believe that.

• 2:54:43Tim Ferriss?

  Yeah, I do turn my books in on time and we could get into that separate time.

• 2:54:48Nick Kokonas?

  I just wanted to ask you a question.

• 2:54:49Tim Ferriss?

  No, I do, I do. I do not turn them in at the expected length.

• 2:54:56Nick Kokonas?

  A little longer perhaps.

• 2:54:57Tim Ferriss?

  Yeah, I do tend to turn them in on time.

• 2:55:01Nick Kokonas?

  So what happened with the aviary is that we basically couldn't figure out how to do another book because the Illini book was such a project and Martin was on to other things and we didn't want to do it traditionally and I didn't know anyone who could do what we wanted to do. And then there was this guy, Alan Hamburger. And boy, if you get nothing else from this whole talk and you've made it this far, go see, go Google Alan and Illini. Alan is a procedural effects artist. He worked at Weta Studios on all the Hobbit movies, doing like hair and water and things like that. So he writes the physics that then makes the, makes the magic, right? And then he worked at Pixar. And while he

• 2:55:44Nick Kokonas?

  was at Pixar, and his wife, Sarah, worked at Industrial Light Magic as the graphics designer. He was given by Sarah a copy of the Illini book, to go full circle, and became just fascinated with it. Was not a cook, did not a cook, and did the Julie and Julia thing. He spent five years, not only cooking his way through the entire book, but also would do things like, well, I don't know where to get this plate, and I've always wanted to learn how to fire porcelain.

• 2:56:15Tim Ferriss?

  Alan, for people wondering, is A-L-L-E-N. There are also videos of Alan and Illini.

• 2:56:20Nick Kokonas?

  Yeah. And he's an autodidact. Like, this guy learns and learns and learns and is the kind of person that goes to the black box and goes, I'm gonna learn how to forge knives, and I'm gonna learn how to fire porcelain. And by the way, I'm gonna cook everything in there, and I'm gonna take pictures of it, and I'm gonna make a book documenting that. And when he asked if he could use, like, we had kind of a little email relationship, and he came up to Illini once to ask Grant some questions about how to make something because it wasn't working. And when Grant kind of threw up his arms and go, well, the book might be wrong. Like, Alan's worldview was shattered. It was like the Bible. And he was kind of like, what do you mean it could be wrong? He goes, well, you know, we did have some errata in there. Like, I mean, we documented hundreds of recipes that could be wrong. And at that point, Alan, like, his mentality changed. It's in the video.

• 2:57:04Nick Kokonas?

  And, and we got to know him and I got to know him. And when he sent me the book, it wasn't what I was expecting. I was expecting like a homegrown book. And what I got was, you know, a 400-page, beautifully, beautifully illustrated, beautifully written book about a person's journey of learning. And it was called The Illiniya Project. And I had no, no idea that he had done anything like this. And so suddenly, I thought to myself immediately, and it's in the intro to the aviary book, I texted him and said, "Holy shit, you're crazy." And I have ideas. And after waiting for like four or five years to do a book on the aviary,

• 2:57:49Nick Kokonas?

  I immediately was like, "This is the guy to do the book." Now I need to lure him out of Pixar, which is about the best place to work in the world. And then I found out his wife worked at Industrial Light and Magic, and she did all the graphic design. And I was like, "This is perfect. You guys need to quit your jobs and move to Chicago." And they flew out. We had some conversations about what they might look like. It was very much a partnership. They would have equity in the book. We would have creative freedom to do it exactly the way we wanted. We knew more about the printing and the bidding and all of that. So I wasn't worried about the economics of it anymore. I was worried about trying to make something really awesome. And right as they were about to say yes, they found out they were gonna have a baby. So they called me up one day and said, "Oh, my God."

• 2:58:34Nick Kokonas?

  Like, I was like, "Oh, they got cold feet. Oh, no." And they said, "You know, we're pregnant. We're gonna have a baby." And I said, "Okay, well, we're gonna wait a year, because there's no way in the world I'm letting you move out, out of your comfort zone and have a child and have that change of life." And they thought I was like punting on them just because, like, in a discriminatory way. I said, "Nope, we're not gonna do this with anyone else. We'll wait as long as it takes." And about a year and a half later, they moved to Chicago. And we spent the last year and a half, set up a studio of our own, spent the last year and a half doing this book, did a Kickstarter to just essentially raise awareness for it. We raised almost a half million dollars in the Kickstarter. We've sold about another $300,000 a book since then. It comes out in October. You can go to thealineabook.com. And the coolest part of

• 2:59:18Nick Kokonas?

  that website is that if you look at-

• 2:59:20Tim Ferriss?

  Thealineabook?

• 2:59:21Nick Kokonas?

  Oh, sorry. Theavarybook.com. Oh, great, Nick. Very the lead, Nick. Very the lead. Genius marketer, you're right there. So, um, yeah, theavarybook.com. But if you, the coolest part of that is, other than, of course, your ability to buy said book, is Alan kept a blog on there called Our Progress. And in it, he details every single aspect of what it takes to make a book like this, right down to line screens and compositing photos of, you know, like, one of the things that every single book publisher told me is that you can't sell a cocktail book for more than $30. There's no market for it. And you don't need pictures because it's just liquid in a glass. And I think

• 3:00:03Nick Kokonas?

  we blew that out of the water with what the book looks like. I think that because certain things like fire are really hard to photograph, there's a great picture in there of this one cocktail where we, we spray some anise and we light it on fire and it creates an aroma into the bowl that it's served in. It's called Loaded to the Gun Walls. It's a Batavia Rock cocktail. And that took a composite of 18 different photographs. And so he breaks down the photography techniques and also the New York Times Bestseller List. And I showed him, like, how, you know, Google Target Marketing works and Facebook Ads work and all that. And all of a sudden, he went, "Holy shit, I had no idea you could do this." So, we are going

• 3:00:45Nick Kokonas?

  completely without a distributor or publisher at this time. And I think we're gonna set a, man, I don't know, like, I'm either completely delusional. It wouldn't surprise me if we sold a half million of these-

• 3:00:57Tim Ferriss?

  Yeah.

• 3:00:58Nick Kokonas?

  -in the next two or three years.

• 3:00:59Tim Ferriss?

  And it's, yeah, it's not a, not a $9.95 book either, which it shouldn't be, right? I mean, this is-

• 3:01:03Nick Kokonas?

  No, it's, it's $85. We've invested close to a million dollars all the way in around it. And it looks like it, I think, I hope.

• 3:01:12Tim Ferriss?

  Yeah, from what, from what I've seen, it looks like it would cost more than that.

• 3:01:16Nick Kokonas?

  Yeah, well, we did it, you know, we did it all ourselves, too. You know, it's really like a five-person project. It's deep enough that if a professional gets it, they're gonna learn a lot. But I'd say about 35, 40% of it can be done at home because unlike the Linea book where, hey, you gotta go out and buy a duck, like, you know, in your local grocery, you might not have this kind of duck or whatever. If you need some flor de cana rum, or, you know, a certain kind of tequila or whatever, you just go to your local liquor store. It's exactly the same thing that we use. You know, that product is universal.

• 3:01:44Tim Ferriss?

  I read somewhere, that I don't think is taking us too far afield. I read somewhere that you consider yourself a tequila guy, or at least in part, a tequila guy. Do you have any favorite tequilas or concoctions?

• 3:01:58Nick Kokonas?

  Well, there's, so I just, I'm gonna do a little video promo for, for the book that we just filmed last week, where essentially I work with Eric Jeffis, who's one of our bartenders in the office, which is our little speakeasy below the aviary.

• 3:02:11Tim Ferriss?

  Which is amazing. If, if people have the opportunity, they should check it out.

• 3:02:15Nick Kokonas?

  It's basically, Grant has said, hey, everything upstairs, people are gonna think it's Linea, smoke and mirrors. We need to prove we can make a real cocktail. So, one of the foundational cocktails for me is, is daiquiri. It's, I say, three ingredients and a million ways to fuck it up. You know, it's, it's just lime, sugar, and rum. That's all it is. And yet, like, most bars you go into will make a terrible daiquiri, or they'll blend it, or blah, blah, blah, right? But a great daiquiri is really, really transformative. So, did a video on that. And then I always make a half mezcal margarita. That's my favorite drink. All I'm doing is I'm taking some reposado, and a little bit of mezcal in equal weights,

• 3:02:54Nick Kokonas?

  along with some, you know, Grand Marnier or, or Quanto equivalent, and lime and simple syrup. That's it. That's all there is to it. Man, I love simple stuff like that. And then we have a whole section in the book on old whiskies, dusty bottles, old gins. Like, there's a growing movement to kind of rediscover some of the distilleries in America that were really, really, really great, that don't exist anymore, that were more artisanal at the time. You can still find those bottles around. Uh, it's a little bit easier than, like, you know, someone like wine collecting or something like that. Man, it's, it's like an endlessly fascinating thing. I don't consider myself a cocktail person 10 years ago. I really loved wine. I felt like, from a health perspective, it was better as well.

• 3:03:37Nick Kokonas?

  But, just like anything else, if you have a well-constructed... Cocktail and something of high quality. It's an additive thing like you could have it in a meal and it can make the meal better. You know, whereas like, you know, a vodka tonic is just boozing and it's just getting drunk. That's not what we're trying to do here. We're trying to make things that are, it's really a culinary approach to cocktails. It's endlessly fascinating, just like anything else in this world.

• 3:04:02Tim Ferriss?

  I would also say, just contrasting, say, someone who wants to recreate something from a Linea, which you certainly could do, I mean, Alan proved that with something from the aviary. There is also a tremendous amount of theater and presentation dynamism that you can create with cocktails that does not have to be super expensive or super complicated. I mean, certainly you guys are able to go as complex as you want to go, which is stunning. And I've spent time at the aviary.

• 3:04:32Nick Kokonas?

  You can easily make some ice with Pedro's bitters in it or something like that. And then as the ice melts in the cocktail, it's going to change the flavor and it's going to look really cool, too. Doing some of these things at home is not hard. I did a dinner party once where it was like, you know, a cocktail party, probably had 40 people at my house and each room in my house had all of the ingredients for the cocktail and then little instructions on how to make it themselves. So that took away the need for a bartender because they're terrible anyway, anyone that you'd bring in and, you know, that you, you know, caterer or something like that. And the other cool thing is that people got really into it. They went like, oh, like, and now I know how to make it old fashioned. Now I know how to make a Manhattan. The one that I discovered that party was a Frisco sour, had like Benedictine whiskey and lemon, you know, it's really delicious.

• 3:05:16Nick Kokonas?

  So it can be more than just like a strong cocktail. It can be really delicate and interesting.

• 3:05:21Tim Ferriss?

  Mm hmm. And people can learn all about this at theaviarybook.com. Is that right?

• 3:05:30Nick Kokonas?

  Yep.

• 3:05:31Tim Ferriss?

  Well, Nick, I have two rapid fire questions that are unrelated. And then I think we're gonna, we're gonna, we're gonna bring this neat and tidy round one podcast to a close, but we've talked about books. Everybody should not only check out the aviary book, but also if they have a chance, go to the aviary. It is, it is tremendous and you can also get some delicious.

• 3:05:58Tim Ferriss?

  Bytes and food, at least last time I was there.

• 3:06:01Nick Kokonas?

  Still can.

• 3:06:02Tim Ferriss?

  At the aviary. So it is a bit of a, I hesitate to call it a workaround, but you guys have some very, very popular establishments. If you want to sample the food, this is also a great way to do it. And the drinks are just incredible. So it's a real sort of destination. That makes a trip to Chicago worth it in and of itself. So I would recommend not only checking out the book, but also checking out. A lot of what you guys are up to. Aside from that, books you have gifted the most to other people outside of those that you've made yourself. What are the books that you've gifted the most to other people?

• 3:06:37Nick Kokonas?

  Yeah, I named one of them already. The Fool by Randomness. Almost everyone in my office is forced to read that.

• 3:06:44Nick Kokonas?

  And I've definitely given that away. Boy, that's a tricky one because just like I said, I can't remember. Books very well, but that's certainly probably number one on a business side of things. And then the, on the other side, I tend to give away, but I would call vintage art books. So it's not a book people can buy. I'm sorry to say, but occasionally I'll be at like a used bookstore and I'll find some of these great old. Art books and I buy a few of them. And then when I, when I want to thank someone for something, I send them that.

• 3:07:15Tim Ferriss?

  Peregrinations of an Epicurean, something like that.

• 3:07:18Nick Kokonas?

  Yeah. I mean, at the end of the day, like I, I bought like, when I give someone something, I try to make it something that. And I really want to make it a great gift. I try to get it something that you can't buy. And so I bought an old typewriter and when I write a thank you note, I type it up on the old typewriter. And it is the most confounding thing to people.

• 3:07:43Nick Kokonas?

  Because they look at it and they go, how did you do that? I'm like, on a 1922 typewriter. It's like a personal artisanal thing, but I know that that's not what you're getting at.

• 3:07:52Tim Ferriss?

  No, no, no.

• 3:07:53Nick Kokonas?

  I can't, I can't really think of, I can't really think of like the number one. I'm sure once we, we end this, I'll immediately think of it. And if I do, I'll, I'll send it to you so you can link to it.

• 3:08:02Tim Ferriss?

  I think the answer, the answer is more interesting with the typewriter. So I, I think what I'm getting at was whatever you just offered. So that's perfect. And if you come up with anything else, we can put it in the show notes. This next one can be tough at times for folks, but the billboard question. So metaphorically speaking, non-commercial, no advertising, but if you could get a word, a quote, a sentence, a question up on a billboard to transmit something to millions or billions of people, does anything come to mind that you might put on that billboard?

• 3:08:33Nick Kokonas?

  I don't know why this came to mind, but the word would be pause. I have no idea why that came to mind, but I think in talking through this whole thing, you know, it's, you kept asking me like, why are you digging this black box or whatever? Or it'd be like curiosity. Like, and I think those are two, I'm thinking of those in the same way. I'm not saying pause, like stop. I'm saying think, right? And so I think, you know, the hallmark of the people that I like as friends the best, what we try to instill in our kids, and the reason I like my wife so much is that intellectual curiosity is everything. And so, I don't know, how do you get that on a billboard?

• 3:09:16Nick Kokonas?

  I think pause, or, you know, be curious, or something like that. I know it's cliche, but I, I think that's the thread that ties everything together.

• 3:09:24Tim Ferriss?

  Yeah, you do pause a lot, even though on a macro level, you seem to be moving at hyperspeed a lot of the time. There are a lot of pauses built into that speed, if that makes sense, from what I've noticed. I mean, you are simultaneously one of the craziest fuckers I know and least craziest fuckers I know, if that makes sense.

• 3:09:46Nick Kokonas?

  That's a great compliment. Thank you. I'll take, I'll take it. I'll take it.

• 3:09:51Tim Ferriss?

  And where can people find you? I know you have, of course, the linear group.com, you have explore talk.com, the aviary book.com, which is the sort of the most timely for people to check out right now. If people want to say hello or follow you on social, where are the best places, best handles for that?

• 3:10:11Nick Kokonas?

  Yep. Instagram, which is n coconis, K O K O N E S, and Twitter is nick coconis, N I C K. And hey, it's all Google-able, right? Like, so beyond that, if you could figure out my email address, I'll probably answer. Although, given the, given the reach of, of, of your podcast, perhaps I will be inundated. It might take a while.

• 3:10:31Tim Ferriss?

  Yeah, that might be a hug of death situation, but we will.

• 3:10:34Nick Kokonas?

  That's okay.

• 3:10:34Tim Ferriss?

  TBD.

• 3:10:35Nick Kokonas?

  It's a good problem to have, I suppose.

• 3:10:37Tim Ferriss?

  Good problem to have. Nick, this is a blast. Thank you so much for taking the time. I really, really appreciate it.

• 3:10:42Nick Kokonas?

  Thank you, Tim.

• 3:10:42Tim Ferriss?

  And many more conversations to be had. This, I think, another trip to Chicago may be in order soon.

• 3:10:47Nick Kokonas?

  I was gonna say, I hope we see you here soon.

• 3:10:49Tim Ferriss?

  I know, I need to get back. And to everybody listening, we've made mention of the show notes, links to everything we've discussed, which you will be able to find at tim.blog/podcast, as with this episode and certainly every other episode. And until next time, thank you so much for listening.

• 3:11:12Tim Ferriss?

  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 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.

• 3:11:54Tim Ferriss?

  And these strange esoteric things end up in my field, and then I test them, and then I share them with you. So 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 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.

• 3:12:39Tim Ferriss?

  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 Mag 3-8, 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. 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

• 3:13:24Tim Ferriss?

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• 3:14:05Tim Ferriss?

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• 3:14:45Tim Ferriss?

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• 3:15:30Tim Ferriss?

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• 3:16:14Tim Ferriss?

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