#53 Ted Leonsis

James Altucher interviewed Ted Leonsis about the six secrets to achieving happiness and success. Leonsis has written a book out about finding those secrets – The Business of Happiness – and in the interview he and James cover a lot of ground about happiness, business, and good timing (or luck depending on your view).

To begin, let’s get some context on Leonsis. I enjoy all of Altucher’s guests, and all of them are considerably successful, but Leonsis is on another level. He’s the owner of three professional sports teams, the Washington Wizards, the Washington Capitals, and Washington Mystics. Leonsis owns the Verizon Center Arena and Snap Films. Leonsis also advises companies like Groupon and was an executive in the AOL heyday.

The book Leonsis is talking about began germinating after a “life reckoning” moment. It was 1983 and Leonsis had recently sold a company for $70 million. He was 26. That company was Red Gate Publishing and it “published magazines for Apple Computer and for Compaq Computer and the like.” Before the sale, Leonsis was focused on only IBM when Apple called to ask if he could do the same for them.

Altucher then asks if Steve Jobs minded that Leonsis was glorifying the IBM PC.

This is a common misconception of early Steve Jobs that Walter Isaacson brings to light in his biography. We sometimes view Jobs as surly and unwelcoming, and he was, to things that didn’t meet his standards. For example, he didn’t dislike Microsoft because they were competitors per se, he disliked them because he felt they made an inferior product and ripped him off to do so. What Jobs sought out and needed early on, was people doing great work. That’s what Leonsis was providing at the time.

The moment that began Leonsis’s rethinking of life was an emergency plane landing.

“While the plane was getting prepared, people started praying and people started crying.  I was left with, “What’s my strength? What am I going to do?” I started to pray.  The best deal that I could try to cut with this higher calling was, “If you let me through this, I’ll leave more than I take and I will try to make this next part of my life more meaningful to the world and not just me.””

Between his company’s sale and that moment on the plane Leonsis was doing what many millionaires under 30 might be doing, “I bought a house.  I had lots of girlfriends.  I bought cars.”

He then made a bucket list, 101 things to do before he died. The list was a good start, but reflected his age. “I made a list as a very, very young person that I’m not very proud of today when I look back because I didn’t have the tools, if you will, to know what would make for a life without regret.” Leonsis included things like “catch a foul ball” and “give x dollars to charity.”

What Leonsis lacked was a meaningful personal narrative, a good story. Up to that point in his life he was living a story that left him feeling unfulfilled. Even though he had money and we think money brings happiness, it didn’t for him. In his book, A Million Miles in a Thousand Years, Donald Miller writes about this. For Miller the moment came when he was making a movie about a book based on his life. When it was time to write the movie though, he realized his life wasn’t very interesting. It wasn’t that Miller had money like Leonsis did, he didn’t, it was that like Leonsis he wasn’t living a story he was proud of.

Miller writes:

“If you watched a movie about a guy who wanted a Volvo and worked for years to get it, you wouldn’t cry at the end when he drove off the lot, testing the windshield wipers. You wouldn’t tell your friends you saw a beautiful movie or go home and put a record on to think about the story you’d seen. The truth is, you wouldn’t remember that movie a week later, except you’d feel robbed and want your money back. Nobody cries at the end of a movie about a guy who wants a Volvo.”

But we spend years actually living those stories, and expect our lives to be meaningful. The truth is, if what we choose to do with our lives won’t make a story meaningful, it won’t make a life meaningful either”

For Leonsis there are specific things to do to be happier. Some he mentions in the interview are:

Connect with multiple communities of interest. Leonsis says, “The busier you are and the more active you are with those multiple communities, the happier and more productive you are.” I’ve seen that to be true in my own life, even having my parents sit me down and suggest I get a job in college after my grades dipped because I wasn’t busy enough.

Leonsis gives many technology examples of this in the interview, Facebook is a community, eBay is a community of interests, he also mentions business that create a positive community.

Have high levels of self expression. “We as a people are inherently creative.  We want our voices heard.  I blog everyday – tedstake.com.  Every single day I blog.  I’ve written books.  I’ve made movies, even though I would be considered a suit – a business person – I’m self-expressing as much as I can.”

Have high levels of personal empathy. Leonsis gives the example of Sergey Brin turning down an offer to bring Google to China. “That was unbelievable personal empathy.  At first, the papers and the analysts wrote what a bad business call it was to not want to play ball in the biggest developing Internet community.  I remember thinking, “The employees are going to rally around him.  The advertisers are going to rally around him.  This is really the right thing to do in the right way, but it’s also going to turn out to be great business.” It did.”

Get out of the “I” and into the “we”. Leonsis tells the story about working in the kitchen for the homeless, teaching people how to cook and then serving them meals. He says that after this you won’t complain about having a bad meal at a restaurant. In doing this you reframe what’s its like to have a meal.

Leonsis introduces the idea of “double bottom lines,” that you can do good for yourself and do good for others at the same time. “They(young people) are willing to trade off a little bit of creature comfort and the win in terms of dollars for satisfaction, happiness, and the ability to say, “I’m a part of something bigger than just being able to have a big apartment or a nicer car.””

I’m not old enough to have seen this for older entrepreneurs, but evidence for the younger generations is clear in the buy a pair, give a pair attitudes of companies like TOMS shoes and Warby Parker.

Up to this point in the interview I’m in lock step with a lot of what Leonsis is saying, then he goes on to say that the Olympics in Washington D.C. is the “ultimate double bottom line.” With this I disagree, and would happily be proved wrong. Whether the Olympics are helpful or harmful to an area, we don’t yet know.

In the interview Leonsis brings up the affordable housing plans that the London Olympic organizers had suggested. That sounds like a great idea, develop an area to use for the games and then repurpose it afterwards.  The actual execution though is not quite so clear. In January 2014, the BBC reported the number of total of homes has fallen from the original 7,000 promised. In the first round of construction only 28% of homes will be affordable housing rather than the original promise of 40%. Leonsis isn’t ignorant, it’s just that his perspective of sports as a double bottom line is different.

Leonsis has been the benefactor of public assistance in the history of the former MCI, now Verizon Center. The arena and sports teams do bring in economic development to the area, and do employee a lot of people. But at what opportunity cost? For one point of view, check out Field of Schemes to see what sort of generous accommodations municipalities have offered to their sport teams.

The best case for the games coming to D.C. might be that Leonsis is an early investor. Other places he’s been invested in early; AOL, Google, and Apple. That’s quite a list.

Leonsis goes on to talk about the convergence of technology with his Apple 2 computer and then shares something I had never heard before. Picture this, you’re working at AOL, the number one internet provider in the United States. Your job is to monitor usage rates, it’s a Thursday night and as the clock ticks closer to 9:00 you reach into your bag to take out Harry Potter and the Prisoner of Azkaban to catch up on. You can take this break because there is an actual dip in internet usage for Must See TV on NBC. That’s incredible. In an age of multiple streams and screens, and Netflix accounting for 34% of wired download traffic in North America.

Now we stream nearly everything, everything except sports. Leonsis, along with Steve Ballmer and Mark Cuban (a past Altucher guest), are looking at it from this angle. Cuban went so far in past episodes of Shark Tank to explicitly share this as an investing strategy, agreeing in principle to a $2 million investment in live event company Ten Thirty One Productions.

Altucher’s asks Leonsis what advice he would give to young people. “A strong math background,” Leonsis says, “the best general managers in sports are the ones that have really internalized stats.  So, you’ve got to have a strong basis in math.“

The pair get into the history of AOL and Leonsis says that “we wrote the original business plan.” I rolled my eyes at this bravado, but then he listed the AOL breakthroughs and then who came out. Leonsis may be right; MapQuest and AOL mail were overtaken by Google Maps and Gmail. AIM was the only instant messenger until Google, Facebook, and other companies. It’s easy to laugh at AOL now, and the 2.4 million subscribers that still pay AOL, but they were first in many ways.

Leonsis finishes up the interview with another great story, about how all those AOL discs came about.

“Steve Case was the founder of AOL and my boss and now my partner in our private equity funds.  One of his first jobs was at Procter and Gamble.  He worked as a brand manager on a shampoo product.  They would do sampling.  When they were going to bring the shampoo product into grocery stores in a new community, they would literally put some shampoo in the mail and they would hang it on the door so that you could sample it.  When he saw the first computer with a modem built in, he said, “I understand that.  Why don’t we give away the software to get you online so you could sample it?” My first reaction to that was that was either the most genius thing I’ve ever heard or the dumbest thing I’ve ever heard.  You want to spend 10’s of millions of dollars making the software and hundreds of millions of dollars giving the software away.  That business practice from another field – consumer goods shampoo and sampling – is how we got America Online”

If you weren’t around then, those discs were everywhere. They were in magazines, store shelves, and in the mail. If they had only smelled as nice as the shampoo samples maybe people would have welcomed them a bit more.

To get more of Ted Leonsis check out his 2010 book, The Business of Happiness and his blog, Ted’s Take.