#20 Stephen Dubner

Fullscreen capture 292015 125354 PM.bmpStephen Dubner (@freakonomics) joined James Altucher to talk about psychology, backgammon, and answer the age-old question, why don’t we say “I don’t know?” By the end of this set of notes, you’ll know. Dubner is the co-author of all three Freakonomics books, Freakonomics, SuperFreakonomics, and Think Like a Freak.

Dubner starts the interview by telling James he was writing a book about the psychology of money but “put that book in a drawer because Freakonomics happened.”  He had left writing for newspapers and magazines to write books and his first two books did okay, but he needed Freakonomics to do much better than those. A day or two before it was released, he asked James “What if this next book doesn’t work out for me?” He told James that, “Most writers vacillate between feelings of intense pride and superiority and intense self flagellation and doubt.” It turned out that Freakonomics was a “total surprise” and complete success and Dubner guesses the books have sold six million copies around the world.

“I could not believe that was me that was going to be attached to a book on the times best seller list. It was full of people who I thought were made of a different stuff than me.” – Stephen Dubner

James says he wants to get into some specific parts from Think Like a Freak, which he says, “could be the best book of all because it gives practical advice, how to think like you guys, from the Freakonomics perspective.”

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But first, James has a theory about how Freakonomics was successful, “you give the secret origin story” he says to Stephen. Dan Ariely confessed this in his interview with James. For Ariely, the way his bandages were removed in the burn unit started his thinking about what sort of conventions we hold that might be wrong. How we might be Predictably Irrational. For Mark Cuban the origin story focused on how his old boss was more interested in a store being open on time rather than a customer services. For Wayne Dyer it was teaching people, but not at the university. For Scott Adams it was a cross-country flight that taught him about using systems rather than goals. We all have moments where a switch is flipped to send us down one track versus another.

Stephen thanks James for noticing this, telling him, “most people when they ask about the books just ask about content, and not the process, and they don’t realize that the process makes the content work or not work.” Stephen tells James that “nine out of every ten words I write gets thrown out.” A familiar expression to other writers like Tim Ferriss, Neil Strauss who wish they didn’t send so much waste to the cutting floor.

Stephen says that he started thinking this way by reading biographies, a chance to “reverse engineer” how a person became who they are. Many other of James’s guest have taken this reverse engineering angle. Tony Robbins (episode #62) lives it and a generation before Napoleon Hill wrote about it. A book James says may not be great, but “isn’t bad.”

Two pillars with corinthian capital Roman theatre Leptis Magna LibyaAnother key to the Freak books success James suggests is that Dubner and Levitt tell good stories. It’s even a section in their book, where they admit that telling stories is often a good way to persuade people. Seth Godin (episode #86)says that the story is never about the teller, but the person hearing it. Gary Vaynerchuk (episode #2)would remind you to match the story to the medium.

People are always asking Dubner about writing and how to write better. He tells James that it came from teaching a class at Columbia called Logic and Rhetoric. The class doesn’t exist under that name anymore, but the book the course used is available on Amazon for $0.01 About the course Dubner says:

What was great about it was that it treated writing in this very old greek model. That anytime you wanted to communicate, whether it’s writing, a speech, or whatever. There are these two pillars, they aren’t necessary equal but incredibly important. The logic is all the facts. All the pieces of the argument that add up to what you are trying to articulate. There is the rhetoric, which is how you tell the story, who’s telling the story, the pace, the timing, the tension and so on.

Stephen tells James the secret for a piece of writing to be really successful you have to be good at both the logic and the rhetoric. The way he improved this, was by teaching it. Maria Popova (episode #89) put this ideas in different words, telling James, “learning to read well and to write well is really learning to think well.”

One staple of Freakonomics style thinking is that “conventional wisdom is often wrong” Dubner tells James and which James says, “is incredibly true for entrepreneurship.” We get into trouble with conventional wisdom because we balance between autopilot/heuristical/habitual thinking and objective analysis. Autopilot, or System 1 thinking as Daniel Kahneman calls it and that systems is always on. Take a look at the Muller-Lyer illusion.mullerlyer-illusia

Now, you know that those lines between the arrows are the same length. You probably knew it before I even mentioned it. But don’t they still look like different lengths? That’s System 1, autopilot, heursicial thinking. It’s good for saving energy and making quick choices but is not easy to override.

Another good part of the book James says, is that “incentives are the cornerstones of life.” Incentives are good, but Dubner cautions you to find the right ones. For example, second graders will read more if you pay them $2 per book read. Once you get up to middle school though, the prices goes up to $20 plus some psychologic hypnosis. When middle school students take a test, you could pay them to get good grades and see a small increase in scores. To get a big jump though, you need to make a connection between the recipient and the incentive. In The Why Axis – another pair of economists – Uri Gneezy and John List offered students a cash reward but had them visualize how they’ll spend it this weekend before even taking the test.

Picture this, you’re thirteen years old, daydreaming in the corner and the teacher announces an exam that you loosely studied for. She says that if you score more than 80% correct, you get $20 but she wants you to take a moment to think about how you can spend it this weekend. My little mind would have been saving up for Warcraft:II. Gneezy and List found that if you get students to visualize what they will spend the money on, their test scores jump quite a bit. This theory goes that, once people have something, they hate to lose it. The students had the money in a way that they were mentally spending it. The Why Axis is a good book if you like the Freakonomics series, also check out Jodi Begg’s econ blog, Economists Do It With Models.

Back to the interview with James, Stephen says that finding the right incentive to use with people can be tricky. People have their revealed preferences and their actual preferences. For the middle school test takers, it was pretty clear that they wanted twenty bucks, what else does a thirteen year old desire? Okay, that, but what do they want that you can give them? For others the incentives aren’t quite as clear and we have the disparity between real and revealed. For example, which one of these statements is most persuasive to you?

  • I will conserve energy because I want to save money.
  • I will conserve energy because I want to save the environment.
  • I will conserve energy because other people in my neighborhood are doing it.

Stephen tells James that when researcher Robert Cialdini surveyed people about this question, most said yes to the first two, and very few said they would follow the pack and be persuaded by the third. When Cialdini ran an experiment though, he found this wasn’t quite true. People who found out their neighbors were using less energy, decreased their usage more than people who were inspired to save money or the environment.

How can you then apply this idea? In Think Like a Freak, Dubner gives the following suggestions.

1. Figure out what people really care about

Middle school kids care about twenty bucks, second graders will be satisfied with two. People don’t always want money or time and it’s up to you to figure out what’s truly valuable to them.

2. Choose something they value but is cheap for you to provide

This idea has come up again and again in the interviews and I’ll again and again point to the first place I heard of it, Getting to Yes. Let me tell you a story in my house. My daughters have three chores to do each day. Pick up their room, pick up the entry, and a rotating chore like feed the dogs or take out the recycling. If they do those three chores, they can have $1 or a token for 1 hour of screen time. To me, the dollar costs more and I’m more than happy to keep a $1 and will give up letting them watching some TV or play on the iPad.

3. Pay attention to how they respond to the incentives

Arnold Schwarzenegger did an interview with Tim Ferriss. He told Ferriss about what it was like before he was a movie star (yes kids, he was a movie star before a governor). To make money on the side he started a european brick company in California. He and his partner in the company played good cop, bad cop to get people to buy more quickly and it worked. The rub was that when they went into their routine, they were yelling at each other in languages neither understood but the customers saw it and it was part of the show and deal they got.

Dubner has a few more specific instructions in the book.

kobayashiAnother point from the book James brings up “is knowing what to measure and how to measure it.” In the book Dubner advocates for people to go back and go back again and go back again to find the source of the problem. The divergence between this and that. One way to make this easier is to ask a question a new way. Rather than ask, how do I eat more hot dogs, ask, how do I make hotdogs easier to eat. This is an actual example from the book.

A third point from the book is to avoid your own biases because of domains transfers. It’s wise, Dubner says, to maintain our domain dependence in knowledge. You wouldn’t confuse the skills of an accountant and chef, even though both use their hands to do repeated tasks that require attention to detail. Thankfully, Dubner says, this is “one of the easiest biases to avoid.”

Problems arise because it’s hard to say I don’t know. Maria Popova (episode #89) called this the “uncomfortable luxury of changing your mind.” This is another case where incentives matter. The incentive or cost, of saying “I don’t know” is a loss of face in many instances. Rather if you make a guess, you might be right and if you’re wrong, well at least you tried. Guessing and being right though can cause more harm than good because you think you understand and missed the important variables. If you hit 21 while playing blackjack you wouldn’t say it was because you had a lucky rabbit’s foot, but that’s sometimes what we do.

James gives the example of a report that said political experts were right in their predictions 47% of the time. If  we hypothetically consult with Dubner he would suggest we ask about their incentives. Okay, this makes sense, we keep hearing that incentives matter, so what’s the incentive to someone on TV? To get more viewers. How do you get more viewers? You can be right more often or you can give the people a show.

Dubner doesn’t mind political experts giving people a show and appluads that it’s a form of experimentation, soemthing we don’t do as often as we should. Imagine what would happen today if university presidents, authors, and great thinkers joined something as paranormal as the Society for Psychical Research, but that’s what happened in the 1890’s. Erik Larson writes:

Its membership expanded quickly to include sixty university dons and some of the brightest lights of the era, among them John Ruskin, H. G. Wells, William E. Gladstone, Samuel Clemens (better known as Mark Twain), and the Rev. C. L. Dodgson (with the equally prominent pen name Lewis Carroll). The roster also listed Arthur Balfour, a future prime minister of England, and William James, a pioneer in psychology, who by the summer of 1894 had been named the society’s president.

Why could such smart people do this? My guess is in part they were open to experimentation. This was a time – and Larson’s book follows this story – where inventors and scientists and governments were harnessing a mysterious power to send information transmissions from one place to another without wires. The Society for Psychical Research members didn’t know what was beyond what we could see, so trying to find other things in thee ether makes sense. These mysterious transmissions are what we call radio waves.

Dubner and his co-author Steven Levitt have been successful because they both have jobs that offer them a chance to experiment and ask new questions. Dubner is a journalist, Levitt an economist, and both get rewarded for asking good questions. In the business world this is harder, as Dubner tells James, “out in the real world, people’s reputations are on the line. People who work at firms..there’s ego and cognitive bias to know the way things work out.” The biggest cost of this Stephen says, isn’t being right or wrong in the moment but that we don’t experiment to find out why things are a certain way.

Dubner says, “When you make an assumption (that you know a reason something happened) you stop actually trying to use and embark on creative ways to gather feedback and experiment and find out.” If you want to start, Dubner writes in the book, start small and here’s why:

  1. Small questions are less often asked and may be virgin territory for discovery
  2. Big problems are dense and intertwined small problems that have to be solved first
  3. Small problems have a smaller mass and are easier to change
  4. Thinking big leads to more speculation, small problems can have more accurate observation

Dubner also echos what others have said about education, that maybe it’s too rote, telling James that formal education is “learning a set of standard facts and talking them back.” Seth Godin (episode #27) says that education should be teaching people to solve interesting problems and to lead. Maria Popova (episode #89) told James that education should be learning about how to live.

One way that Dubner and James have used reframing to re-examine a situation is to replace themselves with a different version of ourselves. James has written about pretending to be an alien or someone’s mother. Duber says that he uses a version of this trick while shopping, pretending that the object he’s looking at is at a New England yard sale rather than perfect retail environment.

This takes work though, to pause in the moment and think about whether or not this situation is something you want. Rather, Dubner suggests you “teach your garden to weed itself” a chapter from Think Like a Freak. That chapter is centered on the story of Van Halen and Brown M&M’s. It’s a story that’s been told many times over – and really best told by David Lee Roth himself.

Rather, here’s a more modern version.

Selling marijuana legally is really hard. There’s growing it, legal issues, and selling it the right away. This doesn’t include one of the hardest parts – getting a business checking account. Many banks don’t want to enter this smoke-gray area of the law. This means that people legally selling it find alternate ways to deposit the money. In episode #602 the NPR Planet Money team find out how some banks are offering their services. One credit union in Seattle is offering a checking service, but with a certain set of questions like do you have a business plan and do you have insurances. And this one:

“Do you have an e-business risk management policy?”

Hmm. Why are they asking about e-business when you can’t sell it online in the state of Washington?

You answer the question and move on. Does your facility have; “security access, security cameras, security alarms, 24 hour surveillance, armed guards, or guard dogs?” This credit union has taught their garden to weed itself because if you are selling marijuana and went a checking account you better NOT have an e-business policy, armed guards, or guard dogs. Answer yes to any of those questions, and you’re done.

Another version is from Ramit Sethi (episode #36) who told a 99U audience that he sneaks filtering questions into his hiring process.

I was recently hiring someone to run my support organization and I knew that I would get a lot of applications…I needed a way to filter people out.

Ramit sent out an email with ten questions, but he only really cared about question #7: “Which metrics do you see as most important for measuring customer service?” This was his version of brown M&M’s and armed guards. It was the answer to this question that would show him if he should examine the rest of the applicants essay. Of the 412 responses, only 2 used the words he was looking for in that question.

Thanks for reading. If I misspelled, misinterpreted, or misquoted something do let me know in the comments or on Twitter, @MikeDariano. Every tenth one of these I share a link to donate. 

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#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.

#89 Maria Popova

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Maria Popova (@brainpicker) joined James Altucher for what he says is “totally just a selfish podcast for me…the only blog I read is your blog, BrainPickings.org.” Here are some of the most popular post to show you why.

James calls her site, “a museum of the world on the internet” and Maria says this sounds about right. Her goal, she tells James, is to share something meaningful about living a meaningful life. There won’t be any Kim Kardashian pictures (though Maria doesn’t mention how she feels about these), there won’t be any listicles (though Maria isn’t opposed to lists), and there won’t be any content. “I didn’t hear you say the word content once, which is one of my pet peeves.” she tells James.

Her line in the sand against content seems to stem from content for content’s sake. When she started Brain Pickings, she didn’t want advertisements because ads would own her schedule, where she became the horse rather than jockey. For a bit of content, take a recent example from the world of sports, where reporter Clay Travis guessed that NBA player Boogie Cousins would be arrested within five years.

This may be the cynical content Maria was talking about.

In the interview James tells Maria that before going on a TV show once a producer told him that it really didn’t matter what he said, they were just filling time between commercials. About this, she says:

It’s hard to conceive of any self-respecting journalist or scholar or writer of integrity who would stand to call his or her work content.

James says the listicle appeals to people and there’s good reason. In fact, a quick Google search reveals that just about every website has a listicle about why we like listicles. This NPR list of lists was my favorite.

Of course, there is an xkcd comic about this.

When Maria began Brain Pickings, she wanted to create something good in a world that was becoming too cynical (what, she thinks reporters predicting NBA players heading off to jail is cynical?). “Why not build things in the world rather than tear them down.” (-click-to-tweet-) she asks James.

The origin story for Brain Pickings actually began to coalesce in college, “I wasn’t satisfied with my actual education.” The University of Pennsylvania was teaching her facts, not how to think. It echoes what Seth Godin (episode #27) told James, that there are only two things we should be teaching kids, “how to lead and how to solve interesting problems.” The argument goes, in Maria’s words, that “information and facts are different than wisdom” and that “the web has displaced the need for absolute knowledge.”

There were these 400 student lectures halls where the professor didn’t know your name and you learned nothing about life. This sounds like the opposite of Cheers. So, working 4 jobs through college, and earning a name scholarship to help, she made it through.

James asks if she ever considered dropping out of school, to which Maria replies that the thought never even occurred to her. “There’s no Bulgarian word for drop-out” she tells him. Words help clarify things for understanding. Nassim Taleb had to come up with the word antifragility to explain things that gain from disorder. Before Maria heard “drop-out” or I heard “antifragile” we never thought in those terms.

After finishing school she continued to work and share emails with friends. Brain Pickings was originally just an email with three links (no description) to eight people. It started very slowly.

Maria kept reading and tells James that “Learning to read well and to write well is really learning to think well.” She’s not the only one who thinks about thinking this way. Sharing what you know is one of the best ways to test your knowledge about what you know. In The Five Elements of Effective Thinking Professor Edward Burger tells the story of students who would come to his office after a low exam score. They would say they knew the material, they just couldn’t explain it. This. Is. The. Crux. If you can’t explain something well, you don’t understand it well. This is more widely known as the Feynman technique. Here Scott Young explains it.

This is actually how this blog began. There was so much to learn from James Altucher’s guest, but merely listening didn’t provide enough connections for me to remember or apply it.

As Maria began this learning process after school she realized that “the process is a much greater reflection of personhood than the product.” She tells James that John Steinbeck wrote two books when he wrote Grapes of Wrath, the story everyone knows and a journal about the story everyone knows. It’s in this second work that Maria has found an incredible amount of value.

James tells Maria that even though we have access to everything via Google, we still struggle to find the things that light us up. Past guest Shane Snow makes the case that limited options actually help. In chapter eight of his book – Smartcuts – he writes that “constraints force us to throw convention out.” Alex Blumberg (episode #70) said something similar about time. When James asked about how he got it all done, he said that because he didn’t have all the time in the world, he chose the things that needed done.

Maria was working after college, humming happily along, when a glitch in the visa system denied her citizenship application. This meant she had to leave the country, so she emigrated again, spending time in London and Bulgaria. Despite having her life pulled out from under her, there was some good to this, she tells James: “There’s often a silver-lining in these less than ideal circumstances forced upon us.” She was stuck without Amazon (yes, there are places like that) and it forced her to read books that were available online in the public domain. She kept writing and said that she was encouraged to see 100 people reading, 100 people following on Twitter.

Let me take a moment to personally thank you too for reading. We’re total strangers. Only one friend of mine listens to these podcasts so everyone that reads this has no reason to except that they enjoy what’s being written here. Thank you for that, it does mean a lot. Okay, back to the interview.

Maria tells James that her current statistics are about 3 million users generating 8 million hits a month, and James says this is no surprise because, “your site is like Alice in Wonderland going down the rabbit hole. Once you get into one article you have like 5 links to other articles and I could spend an hour going from article to article on your site.”

One of those articles was Happy Birthday, Brain Pickings: 7 Things I Learned in 7 Years of Reading, Writing, and Living. James wants to jump into a few of the ideas.

#1 Allow yourself the uncomfortable luxury of changing your mind

Maria says she learned this in part from Andrew Sullivan, and it’s a form of intelligent thinking. Stephen Dubner writes that being wrong is one of the ways you can start to think like a freak, or at least, like him. “The three hardest words are ‘I don’t know’” he writes in Think Like a Freak.

Tackling this tricky tic in true Freakonomics fashion, Duber and his co-author Levitt lay out a type of logic that says guessing is often a much better course of action. If you admit, up front, you don’t know then you always lose some credibility because of the way we view people who don’t know things. If, on the other hand, you make a guess, you have a chance of being right. Rather than saying that we don’t know what Apple ($AAPL) will do in 2015Q2, we make a guess that they’ll be up 40%. There’ s a chance that will happen. If it doesn’t though, there’s no cost for our guess, we can just walk back the position, change it, or even admit that it was a tricky situation and we did our best. James says this isn’t an easy thing to do, especially on TV, where if you don’t know or change your mind, you’ll never be invited back.

Jeff Bezos, CEO of Amazon stopped by the 37Signals offices to talk about product strategy and told Jason Fried (and the others there) this:

He said people who were right a lot of the time were people who often changed their minds. He doesn’t think consistency of thought is a particularly positive trait. It’s perfectly healthy — encouraged, even — to have an idea tomorrow that contradicted your idea today.

#2 Do nothing for prestige or status or money or approval alone

In their interview James and Maria share the story of Albert Einstein telling a colleague that the awards for doing work aren’t real awards at all, the work is the reward. If you find something you enjoy doing, that’s your thing, your prize, your gold watch.

Stephen King answered a similar question, “Do you do it for the money, honey?”

The answer is no. Don’t now and never did. Yes, I’ve made a great deal of dough from my fiction, but I never set a single word down on paper with the thought of being paid for it…I have written because it fulfilled me.

#3 Be generous

Spac0587 - Flickr - NOAA Photo LibraryMaria writes, “Be generous with your time and your resources and with giving credit and, especially, with your words. It’s so much easier to be a critic than a celebrator.” Austin Kleon shares a list of things he wished he learned when he was staring out, one of which is “Be nice. (The world is a small town.)”

Astronaut Ron Garan is making the case that you don’t need to go to space, to get an “orbital perspective.”

You don’t have to be in orbit to have an Orbital Perspective. This is one of the main points of the book and why I cite so many examples of people acting with an orbital perspective who have never been in space. We apply the orbital perspective by acknowledging the framework that we’ve constructed to view the word, by considering the long term/big picture implications of our words and actions and above all else by practicing what I like to call “elevated empathy.”

Maria also notes- and James enthusiastically agrees – that one remark of criticism scores deeper than one of kindness. Amanda Palmer (episode #82) told James much the same thing, saying that one bad review among 99 good ones can “overpower your psyche for a day.”

The end of the episode is all about how the creative process works, how James and Maria turn lead into gold. James says, “You read and you read and you read and it’s like rubbing sticks together until something catches fire.” which Maria says, “is such a wonderful metaphor.”

The grand finale is a list of books that Maria has recently enjoy and include: On Looking: Eleven Walks with Expert Eyes.  In that book, Alexandra Horowitz walks down the same block with eleven different experts to get eleven different stories. This demonstrates an idea that Daniel Kahneman terms What You See Is All There Is. He writes: “information that is not retrieved (even unconsciously) from memory might as well not exist.” Our default thinking is to quickly categorize the world around us, and how we categorize those things depends on what we know (can retrieve).

Other books Maria suggests are: The Faraway Nearby, The Art of Asking, A Field Guide to Getting Lost, On the Shortness of Life, Daybook: The Journal of an Artist, Anne Lamott, The Art of Stillness, Joan Didion, Waking Up, Hackers and Painters, Still Writing, Arts and Letters…this list could go on forever, you really should just head over to BrainPickings.org.

Thanks for reading. Let me know where I strayed in the comments or on Twitter, @MikeDariano.

 Notes on the notes:

Maria Popova gave a great interview with Tim Ferriss as well. There they talk about meditation and mindfulness.

If you like Brain Pickings you may also like Farnam Street.

She also wrote in the great Lifehacker series, how I work and shared what she’s really good at, “I do brew excellent kombucha and can do more pushups in a minute than most people. The secret, of these and of any life skill, I believe, is practice and stubbornness.”

The public domain is when intellectual property rights have elapsed. Generally 70 years after the death of an author.

This site participates in the Amazon Affiliate program. If you follow a link from here, to there, and buy anything – a few cents of the purchase get sent to me. Thanks.

#36 Ramit Sethi

Ramit Sethi joined James Altucher to talk about psychology, choice, and experimenting with systems to get them just right. Sethi is the author of the book, I Will Teach You To Be Rich and the blog of the same name. The book has 4.5 stars on Amazon and 500+ reviews. Some people say it’s “entertaining and informative” and “a fresh breath into realistic money management.” Others are more critical, saying it was too long or “for someone in their twenties.”

The interview begins with James telling Sethi that “every piece I read from you is helping people when they need it.” Some of his most popular articles include:

Sethi’s origin story began with the college application. Knowing he had to pay for school, and tired of writing admissions essays over and over again, he set about to create a system. “All the essays had the same five or six prompts,” he told James, so he set about making those five or six expositions extraordinary. This got him admissions, but the round of interviews was harder. Sethi was an awkward kid, and after watching himself in a self-recorded video found out that “Smiling actually matters.”

On the surface it seems like Sethi’s first skill was maximizing his application skills, but when James presses him, he admits that it’s experimenting.

“Breaking down your mistakes is the fastest way to learn.” – James Altucher (tweet this)

This has been Sethi’s point of leverage since, study and experiment and tinker with things until getting them just right. He’s the Goldilocks of the young adult world. James says that to break away from you must be “analyzing frame by frame, the critical moments in your life.”

Rather than authentically experiment, James says we all might be insane, “the definition of insanity is doing the same thing over and over again but expecting different results” For Sethi, those experiments focus on psychology in the lab of life.

“We are fundamentally cognitive misers (we hoard and spend at little as possible).” He tells James, but that’s how we evolved. Hise stone in his shoe moment came when he invested his first scholarship check in the stock market and lost it all. At this point Sethi realized he better figure out how “this money thing worked.” In his research he found the same anecdotes come up again and again – buy a house, skip Starbucks, don’t eat out. Why were the same answers always given to the prevailing questions but so many people failed? Something was amiss and Sethi began to explore these “great lies.”

Instead of focusing on the small things, Sethi wondered, what if we focused on the big ones. If you nailed four or five big things, then the little things would be irrelevant. He wanted a rich life, which he tells James, “part of a rich life is money, but it’s only a small part…for me a rich life is about saying yes. For a lot of my readers it’s about saying yes ‘I want to go out on Friday night. Yes, I want to take trip to Vegas. Yes, I want to buy a round of drinks, a vacation for my parents.”

Tony Robbins (episode #62)writes about a similar attitude in his book, outlining that you need to keep remembering what you want the money for and that there are levels to your desires. Sethi mentions, buying drinks and vacations in the same breath but they are different lives in reality. Robbins terms these two actions financial security and financial independence. The former is being secure in your basic needs, the latter is to have your needs and desires met. Robbins suggests that you may never be a millionaire, but if your housing, utilities, food, and transportation were paid for, you can be quite happy. Sethi takes a different angle on the same situation, encouraging people to look at the ends you want and work toward them.   

One way that Sethi suggests people go about this is to automate everything. Pay for the things you have to first, and then whatever is left over is yours to spend – preferable guilt free. Alexa von Tobel, founder of LearnVest told Lifehacker that this is her best time-saving trick:

I try to automate all tasks that truly do not require energy. For instance, I basically eat the same breakfast and lunch every day (dinner is my fun meal). Why waste time on figuring out what I want to pick up for lunch? I know what I like, and I stick to it. Small automations like this add up. I think it of as my personal operating system.

There’s good psychology in arranging some things in our life to be automatic. Nobel Prize winner Daniel Kahneman writes that “self-control and cognitive effort are both forms of mental work.” Imagine you have 20 manna, points, or lives (any token will do) to spend during the day. If you spend more on motivating yourself to do something (the self control part), you’ll have less to spend on the brainstorming, focus, and depth of learning (the cognitive effort part). When Sethi advises people to buy the coffee they want and then get to work, he’s almost balancing the mental work equation. James puts it another away:

“Saving on that Starbucks won’t make you be rich or go broke.” – James Altucher

What will make you go broke is buying a home. Sethi says that about forty percent of the people that come to him with money problems, owe it to owning a home. James says that for him it’s closer to ninety percent. Sethi has a handful of articles about housing and “phantom mortgage costs.”

Carolina-Duke basketball 2006 1.jpg

Another bias James and Ramit talk about is how we tend to overvalue something we own. Dan Ariely, a past guest,  wrote about this in his book Predictably Irrational. His study focused on Duke basketball, and was a wonderfully real-world experiment. At Duke, students entered a lottery for basketball tickets. If you entered the lottery, you wanted to go to the game. Everyone who entered was a Duke student, so the study group was relatively homogeneous, meaning, there weren’t going to be rabid basketball fans getting tickets and non-fans not getting them. The only logical difference after the ticket lottery would be that some Duke students who wanted tickets got them and some Duke students who wanted tickets did not. Ariely wanted to know if there was a difference in value for the tickets of each group.

He recruited some undergraduates students to walk along the dorms and survey people about whether or not they got a ticket and what they might sell or buy the ticket for. On average, those with tickets would sell them for $2,400 and not a dollar less. On average, those without tickets might pay $175 for a ticket.

That’s a 14X multiplier between buying and seller. WTF is happening here? How do people that are almost the same except for ticket/no ticket become so far apart on price? Once we own something, Ariely writes, things get peculiar. “Our propensity to overvalue what we own is a basic human bias, and it reflects a more general tendency to fall in love with, and be overly optimistic about, anything that has to do with ourselves.” You don’t need to read academic articles to see this, visit any garage sale or flea market to see it in action.

Another of the great lies James and Ramit talk about is how the job market stinks, and you should take what you get. In his spirit of experimentation, Ramit told James that he thought he could help his friends get better jobs if he could study what they did. So he began coaching a friend in exchange for her letting him document the process. Gary Vaynerchuk (guest #2) used this same form of bartering to get discounted billboards and cab advertisements.

Sethi found that “the best jobs happen through personal networks.” Great, you’re thinking, but how do I do that? Adam Grant (guest #73) suggests two specific ways. First, “ask thoughtful questions and listen with patience.” Givers, Grant writes, give best when they give something they know well. Find something that you know and begin to help people in that domain. James does a Twitter QA each Thursday, that’s giving in a way he enjoys. Second, Grant suggests five minute favors for anyone that asks. These micro-favors should be anything that helps another person and only costs you about five minutes. Grant found out that people who give in the right way were more successful than people who were takers, matchers, or givers who gave too much and in areas outside of their expertise. Be good giver and you’ll build a good network.

But I’m (not connected, in the wrong industry, not skilled, <your own excuse>). Take the no complaints diet challenge and forget about the things you can’t do and focus on the ones you can.

In their conversation, Sethi gives two actionable steps for anyone to take:

  1. Email a person – but bring value. Write them to say that you’ve read/watched what they’ve written/done. That XYZ advice had a big effect on you and you tried doing it, but you are stuck with MNO. Can you give me advice?

Part of doing this well is to be prepared and that means having good questions. James said he learned from Tony Robbins that if you “ask lousy questions, you get lousy answers.”

  1. “When you get good at something, you get passionate.” Sethi tells James. This is the rallying cry, trumpet announcement, and bullhorn bulletin from Cal Newport and his book, So Good They Can’t Ignore You takes it’s title from a Steve Martin comment.

stevemartingrammyMartin told Charlie Rose, “nobody ever takes note of (my advice), because it’s not the answer they want to hear.” People plead for a panacea, they don’t want to hear about being good at something. Martin tells Rose that  “I couldn’t even play an instrument in high school,” and “my mother played piano well and my father sang, but I inherited neither. I guess I sang like my mother and played piano like my father.” He learned by lots and lots and lots of practice. He would buy a magic trick and practice it over and over again until he nailed it. To learn the bango he would play a record on a slower speed and pick along, figuring things out as he went and telling Rose, “That’s how we all did it.”

Sethi applies this deliberate practice angle to things like creating side income and successful job interviews. He tells James that there is a very specific response – one you would know if you practiced this enough – to use when you go to a job interview and the employer asks about salary. James warns Sethi about anchoring yourself to too low a number. Anchoring is a tricky mental bias because we sometimes don’t even know it’s there. Let’s try, take this quick 2 question survey about how many years separated the birth of George Washington and Napoleon Bonaparte.

I’ll share these results in another post, but that’s not what Sethi is getting at. In his research, talking about salary in an interview fails to show the right competence trigger. Walk in the right way, say the right things, look the right way and you’ll show some something you can never hope to say.

Sethi explained one of the ways he uses competence triggers in hiring. In this video at 99U he explains that he was looking for someone to help run his customer service. He knew he would be getting a lot of applicants and needed a way to filter them out. So he inserted a specific question that he wanted a specific type of answer for. Sethi was looking for certain words that he knew the right applicant would use as a signal of competence. Van Halen used a similar technique, only with brown M&M’s.

vanhalenWhen they were touring in the 1980’s Van Halen had some of the biggest stage shows around. It would take hours to set up custom light and sound riggings, some of which a venue may have had no experience with before. Rather than “Jump” around looking for loose connections or “Dance The Night Away” making sure the rigging was right, they didn’t something more ingenious. They asked for a bowl of M&M’s to be in the dressing room, but all the brown ones removed. Rather than primadonna antics, this was a signal for them about how closely their directions were followed. They assumed, if someone took the time to pick out brown M&M’s, then they also took time to set up everything correctly. You can hear David Lee Roth tell the whole story to NPR.

James asks why Sethi does courses rather than ebooks to which he replies, “I don’t want to play in the $4.95 sandbox.” It’s not condescending, it’s wanting to create something better than that. Sethi explains, “when you get serious you don’t want to sift through things” in a course he can “make sure everything works for you.” Sethi says that he does a lot of experimentation and testing so that when you do begin his course, the kinks are worked out, the hurdles lined up the right away, and if there’s a mountain to scale you’ve at least got climbing gear.

His business is based on The Strategy of Preeminence (TSOP) by Jay Abraham. (I had to dig for this nugget because it only came up implicitly in my research). TSOP is a business strategy equivalent to being a tour guide in an unknown land that someone wants to explore. It’s giving the customer control to make their own decisions, being authentic in your communication, and providing focus for them.

Sethi does this through his courses, which begin around a thousand dollars and go up from there. These classes require work and Sethi’s upfront about this saying passive income, “is mostly B.S.” Dreaming of a job where Google Adsense money trickles in while you sit on a sandy beach is a mirage.

The conversation between James and Ramit pivots to what you might do, if you wanted to create something and it begins with research. Hypothetically, let’s say you want to sell an ebook about how to save money by doing your own home repairs…

Stop.

What?

Stop right now. Ramit tells James that people who want to save money, don’t want to buy something that tells them how and this halt is the first bit of research that you need to do. Don’t create anything until you know which direction to create in. Rather than something that teaches people how to save money on home repairs, create something that teaches people how to have IKEA looks without composite wood. Alex Blumberg (episode #70) had a recent experiment with this on his Start Up show. Blumberg was kicking around the idea of creating a technology in addition to content. A player for the podcasts. Rather than build an app, they built the skeleton of one. He compares it to a model home where the refrigerator is just a prop and the faucets shine but there’s no water.

This early orientation on what you’re going to create is a crucial step in the research Sethi says. You have to find an idea and identify who is the buyer, what are their hopes and dreams, what is their pain? Before you start to solve a problem, you have to find out what their problem is.

Once you know the exact question and find out a detailed, obstacle clearing answer. You can start to promote it. In Jab Jab Jab Right Hook, Gary Vaynerchuk breaks down the different ways you can connect to people and what they expect on each ramitface.bmpjamesaltucherfacemedium: Facebook is for stories, Twitter is for listening, Pinterest should be pretty. Each connection with people should also reflect what your image is. My guess is that Ramit won’t ever be seen in sweatpants. Altucher’s picture of sitting crosslegged seems right. It shows that his show is informal, he looks inquisitive. Swap these pictures and think about James selling products and Ramit hosting the show and things are quite a bit different.

When it comes to naming things, Sethi has this advice. Rather than name his program “Earn 10K” his course is called “Earn 1K.” Naming things the right way can head off any objections a person has (again, TSOP). He tells James:

“When we created a product called Earn1K, this was the headline…Finally a proven legitimate program to identify a profitable idea and turn it into a reliable side income of a $1,000 a month with just five hours a week.” Then he explains why this works:

  • Earn 10K happens but people might not believe it, 1K is reachable.
  • Don’t I need to quit my job? Nope, it’s a side income
  • This sounds like a scam, has it been tested? Proven and reliable
  • But what if I don’t have an idea? The course helps you identify it.

“We didn’t just come up with it, we didn’t just sit in our room and write it. It’s all about the research.” – Ramit Sethi

And then you have a sale and “there’s something really magical about the first time you make a sale.” Sethi tells James, but that first sale requires work. He tells James:

Instead of trying to sell things and show people how to make  a quick buck, we show people how to build a relationship.”

And relationships are key. Gary Vaynerchuk writes that the Web2.0 is a return to the small town conversations that people used to have, only the topics are now global. “Treat people like you’ll be sitting next to them at dinner that night.” he says. Vaynerchuk joins Altucher and Sethi as a fan of guest blogging, telling James in his interview that it’s “The singular, most fruitful way to build a personal brand or build awareness of what you do.”

When you line something up, be ready to tell stories. Seth Godin (episodes #27, & #86) says that until we’re all “MIT graduates” we will flock to stories, and remember, says Godin, that the best story is “never about the teller. The story is always about the person hearing the story.”

As you write your stories, begin to collect email addresses but walk a clear line. Sethi is all over Tim Ferriss for his weak email newsletter. Sethi tells James that you want to give stuff that’s so good you are fulfilling their demand. Two of my favorite email lists are Farnam Street and Becoming Minimalist. Each time they arrive in my inbox I look forward to what they link to. Gary Vaynerchuk would call these good jabs.

The interview wraps up with a handful of tips and suggestions from James and Ramit.

About starting: Ramit says “If you look at someone from the outside and they have a successful business or blog and a podcast and you’re like wow, there’s no way I could do that. I felt exactly the same way…. but jump in anyway.”

About credibilityRamit says to judge people’s credibility by what they get out of it. The mortgage industry will tell you good news about housing that’s good for them. When you look at Ramit or the mortgage industry (or anyone) ask how credible they are. Nassim Taleb too uses this heuristic and his solution is to look at time. The longer something has been around, the more credible it will be.

About lifehacks: Getting to the gym, eating right, managing your time. Ramit has a pdf of little lifehacks.

About challenges: Periodic challenges seem to move us to take positive actions. James and Ramit suggest you email someone and thank them for some work they’ve done. Do it. Really, go do it.

– 

Yikes! 3,500+ words. I always love feedback about these posts so please reach out on Twitter @MikeDariano, text (559) 464-5393, or in the comments. Finally, I have one big request. Could you please, please, please let me know what’s stopped you from doing a daily idea list? Do you see value in it? Is it a habit thing? Do you need more structure? Advice? Is it lack of knowledge, understanding? Use whatever words best explain why you don’t do a daily idea list. If you do, let me know what works.  

Thanks- Mike

Further Notes:

If you are interested in specific tips for writing, check out Writing Tools by Roy Peter Clark has a slew of exercises. If you want to guest post, I run 27GoodThings.com and people there share good things to read, watch, and use. If you head over and it looks like fun, get in touch. I couldn’t find the Taleb quote about time and people who only say good things. Antifragile is a big book and I wanted to publish this post without it. If you find it in there, please let me know.

#88 Lewis Howes

lewishowes.bmp

Lewis Howes (@LewisHowes) joins James Altucher (again) to talk about what’s happened in the last year. Howes was a professional football player who moved from sister’s couch to running a multimillion dollar business.

The interview begins with James asking Howes about his handball experience. Specifically, what his handball? “Tennis without the racket, water polo without the water, soccer with your hands on a big basketball court, lacrosse with your arms.” It’s this:

Howe’s says that while he was recovering from an injury, he watched the Olympics in Beijing. Want to be an Olympian, he started thinking about sports he could hack and found handball, “I was mesmerized” he tells James. In one way he began to study what it would take to become a handball player, in another what it would take to create a business. Howes was applying the same deep understanding that Dick Yuengling (episode #79) had about moving beer barrels and Mark Cuban had for computer network.

Wanting to learn how to play handball, to really become good at it, he figured he had to move to NYC and to do that he had to make some money. He learned LinkedIn and covered a lot of that ground in his first interview. Arriving in NYC, he found a place where people played, and just showed up. He tells James:

So I show up, I say hey guys, I’m Lewis Howes from Ohio. I’ve never played handball but my goal is to make the US national team and go to the Olympics.

Lewis is a big, fit guy. Former pro-athlete. What was the reception?

They all laughed their asses off. I was the only American there.

About those international handball players. “They were speaking in like ten different languages to each other about this white kid that never played, but every week I showed to practice for that year.”

woodyallenshowing“And it’s been a journey ever since.” If you want to cheer on the American team, they have to win the PanAm Games, July 10-26th in Toronto to make the next Olympics.

James focuses the rest of the episode on Howes’s podcast, The School of Greatness. James asks how he got Tony Robbins (episode #62) as a guest. After cancelling because he was going to India, Robbins finally sat down to talk with Howes. James says that he “wanted to make things as easy as possible for him (Robbins)” so he flew down to his house in Florida and had a “good solid conversation.”

You can watch Howes and Robbins talk:

James remarks that “somehow Tony Robbins really resonates with millions of people… in part because he’s legitimately helped millions of people.” Howes has too, and the pair dive in to some of the things he’s learned this past year.

How to double your energy

Howes talked to Yuri Elkaim who wrote The All-Day Energy Diet: Double Your Energy in 7 Days. Howes tells James that his big takeaway was about sleep and coffee. “Caffeine is something that is not going to double your energy” Howes tells James, “A lot of people use caffeine to use energy or get them up, but it’s really something that’s the opposite of what you should be doing.” Howes says that he can feel the effects of caffeine and “gets shaky” if he drinks too much.*

Beyond sleep and caffeine, people can eat the right foods and fasting. Past guest Nassim Taleb advocates random fasting and there is good medical science to support it. Scientific American writes that it’s at least good, if not great to do, and it’s easier than ever. NPR too reported on fasting and gives nice details about the 5:2 plan. If you really want to do it, check out the NPR post, it has specific steps. Though none of this is making James feel better, he tells Howes, “I feel like science has ruined my life in the last few years.”

Howes also mentions an episode with Sean Stephenson who recommends other sleep tips like:

  • Turn off all electronics two hours before bed.
  • Go to sleep between 10 and 11.
  • If you use a screen, get orange tinted glasses.
  • Get room darkening shades.
  • Have a sleep plant in your room.

How to master your memory

Jim Kwik, was on the School of Greatness podcast and Howes says, “he gives a lot of great tips.” Kwik uses a memory palace technique” and Howes asks about how to remember key points to a speech.

This super memory is nothing new. In the wonderful Moonwalking with Einstein, Joshua Foer writes:

It was simply a matter of learning to “think in more memorable ways” using the “extraordinarily simple” 2,500-year-old mnemonic technique known as the “memory palace” that Simonides of Ceos had supposedly invented in the rubble of the great banquet hall collapse.

Wha?

In the fifth-century-BC, Simonides was about to give a speech to a crowded hall. Right before he stepped on stage he got a message to step outside. He did and the moment he crossed the building threshold it collapsed. When the families came to collect the bodies, Simonides was able to close his eyes, recreate the scene, and guide them to the portion of rubble their kin were buried in.

Howes says that Kwik told him he wasn’t always very good at remembering things and forced himself to learn a new way to learn. He’s not the only one, Gary Varynerchuk (episode #2) was a D and F student. Brian Koppelman (episode #59) had bad ADHD.

Altucher hypothesizes that maybe Kwik remembers things that he was passionate it about. My guess is that it’s the connections that matter most. Kwik uses memory walks or memory palaces because they create a visual connection. Altucher is using emotional connections to remember things thirty years ago. Howes mentions that remembering why you want to remember something can even help.

Altucher says that the Kwik interview with Howes reminded him of Apollo Robbins, “The Gentleman Thief.” Rather than describe what he does, you should watch it:

James says, “I wish I had a skill like that.”

Themes of greatness

Howes says that there have been certain things he’s learned this past year that he’s developed into common themes of greatness.

“So many people who are great have a clear vision (tweet this). It’s so crystal clear on what they want to achieve and why they want to achieve it.” Howes tells James. You need to know which direction you want to go, before you can orient yourself that way.

Overcome adversity and turn it into an advantage. “There are going to be injuries or breakdowns along the way” Lewis tells James and he suggests that you “surround yourself with really positive people. When this happened to me, my emotions were really shaky. Losing my dreams was a huge blow for me.” Howes has what Taleb would call domain fragility a cousin of the halo effect. Domain fragility means that while Lewis could physically crush an 82-year-old immigrant living on his block, she was much more emotionally strong.  He can handle the physical weight, she the emotional.

Domain dependence matters because as Stephen Dubner told James, we need to be aware of the Halo Effect in our thinking. This is the idea that because someone knows something about one area, we give them credit for knowing about others. I write these posts and have a decent grasp on psychology, but when my best friend calls to talk about his new diet, I need to learn to shut-up.

You could also find a good coach. Howes tells James:

“all of the greatest athletes I know have amazing coaches. Everyone of them. Gold medalists, they all have great coaches. Not everyone of the greatest business minds have coaches, but some of them do have coaches. I think people are missing out if they don’t have a coach in every area of their life.”

In his book about Money, Tony Robbins shows his remarkable connections because of coaching. He even confesses in the book that he has almost no experience with money and admits in the book about some of the past and current mistakes he was making. What Robbins did have were connections to people who know a lot about money. Robbins coached Ray Dalio on success, Dalio coached him on money.

One new storefront for coaching is Coach.me. There you can start to build habits by not “breaking the chain” of successful days, but also connect with people. I’m a coach there, but there are many other good people to help with eating right, meditation, writing, or whatever goal you’re aiming for.

James wonders aloud if “reading replace coaching?” but Howes is skeptical because how important the feedback is. Ramit Sethi lives and breathes feedback (and his interview notes are coming soon).

The interview ends with Howes telling James what’s next, “my intention this year is really to build a distribution network.” Podcasting funnels people into the School of Greatness Academy but he wants to create more automation. James says their mutual friend Molly Hahn has been doodling Buddhas and “is making a six figure income from it” and succeeded in part thanks to the academy.

James has similar thoughts about podcasting (and book writing) funnels:

“I think people have to realize this. Podcasting itself, just like book writing. Book writing might not be a business model for many writers. You might write a book and you’ll make a little money, but not much money, but you have to think of all the other things it gets you.  It gets you an audience. It gets you those true fans. It allows you to have an impact on people. I think podcasting is similar.”

Howes jumped into podcasting because “I had seen the trends in video, people were watching on-demand.” Would this happen with audio? Maybe. “I want to be where the puck’s going to be.” he says. Howes is lucky, acting in a very Gary Vaynerchuk way, who writes that that we don’t need to scoff at new mediums, like podcasting. Rather, “a smart entrepreneur will head over to the platform, see the bikini shots and think ‘How can I do better.’”

If Howes were giving someone advice, he said that you should find something very specific to focus on. James said the new Denzel Washington is the Greatest Actor Of All Time Period podcast might be a good example of that.

Howes next adventure is creating a digital magazine, which he says, “is either going to be a big win or a massive failure.”

One oddity from this episode was that Howes admits he doesn’t read digital magazines or listen to podcasts. James has said the same things about podcasts. For the alternative they might consider “eating their own dog food/using their own lathe.” If nothing else they’ll find gems like this near hour-long tutorial on storytelling from one of the best, Alex Blumberg (episode #70).

First of all, thanks for reading. Those 1900+ words you just read are about an entire book chapter and that you read them all means a lot to me. I’ve got a request, but I think it’s pretty small. Could you pick one of these questions and answer it?

  • If you do a daily idea list, why do you do it?
  • If you don’t do a daily idea list, why not?
  • If you tried to do a daily idea list, what kept you from doing it?

You can comment below, use Twitter (@MikeDariano), or text ((559) 464-5393).

#2 Gary Vaynerchuk

jabcoverIn the second interview of the podcast, Gary Vaynerchuk (@garyveejoined James Altucher to talk about marketing, becoming an expert, and the missed opportunity of a hey girl meme with Altucher rather than Ryan Gosling.*

Vaynerchuk is on to talk about his book, Jab, Jab, Jab, Right Hook: How to Tell Your Story in a Noisy Social World and tells James that “our content must be contextual to the platform we put it on.” Gary’s argument is that we shouldn’t be creating visual content on a textual medium and we can use Twitter and Facebook better. Before addressing some of his key strategies he says, “we’ve all become one person media companies.”

The thinking behind his new book is that we need to give, give, give, before we ask. From his book:

Jabs are the lightweight pieces of content; games, laughs, appreciation. Right hooks are the calls to action.

Amanda Palmer (episode #82) told James that we have to ask in small ways – and be ready for rejection. When it’s time to give though, you give as best you can. Palmer wrote, “I chatted constantly online, and listened to the input and feedback from the fans. If they wanted high-end lithograph posters, I made high-end lithograph posters.” Palmer continues to give, being active on Twitter @AmandaPalmer.

Example, her “ninja gigs” –

Many examples from Jab are from companies but Vaynerchuk wrote the book for everyone to apply, and even though we have fewer resources, we may be better off. In episode #27 Seth Godin told James that when he was the canoeing instructor he had to learn to tell a good story. Godin was competing against sailing and windsurfing instructors who didn’t need to build their skills of storytelling. Their activity sold itself.  Altucher too has said that constraints work to focus his daily idea list, writing on a waiter’s pad leaves only enough room for the key ideas. The writers who have been interviewed apply this idea in a similar way, Ben Mezrich (#84) writes about high stakes, high reward situations. Simon Rich (#83) takes extremes and puts them in familiar situations. Constraints are good.

Apply these ideas to marketing and Vaynerchuk suggests that the different platforms lead to different types of content – and this isn’t new. Take the commercials for food you hear on the radio. It’s no coincidence that those ads run from 11-1 and then again from 4-7. Restaurants have different marketing for radio rather than TV or print and different nudges for different times of day. Vaynerchuk has advice for other places too.

Vaynerchuk on Facebook:

Vaynerchuk tells James that “you can’t use Facebook for constant calls to action.” This is where you can build a conversation with people and give your expertise to them, for free! Ramit Sethi has a private group that I’ve heard great things about because it’s a conversation with people. There’s very little selling (from what i’ve heard, I’m not a member) there but instead a community of people trying to be better.

Vaynerchuk also tells James that you have to have images in your posts. Have. To. In the constant scroll of feeds, it’s images that stand out more than anything else.

Vaynerchuk on Twitter:

The Twitter.com/search url is underused he says. Finding out what the conversation is about and latching on to that is another tool. Hashtags too are something that people can try to latch on to during the “land grab” of the changing landscape. For example, when this post went out, #nerdiersports was trending, breaking down podcast is pretty nerdy so I chimed in.

Another example of trend jacking would be to find a way to hop on the hey girl meme that took off in 2011 and 2012.

heygirltrend.bmp-012

Vaynerchuk on Guest Blogging:

“The singular, most fruitful way to build a personal brand or build awareness of what you do.”

Mark Cuban leveraged this in a sense when he wrote articles about routers. Seth Godin also wrote for others.

Vaynerchuk on Reddit:

Gary says that Redditt is a great place to connect with people, noting that the Reddit.com/ama concept is wonderful. James says it was “the number one way I was able to market and move sales of my book.” (James Altucher AMA, Gary Vaynerchuk AMA)

During the interview it seems like Vaynerchuk has win after win, but he tells James this isn’t quite the case. He immigrated from Russia, and the first 18 years of his life were hard. He was an F and D student.

After that he went to work in his parents liquor store and started a number of successful companies; Wine Library and VaynerMedia in addition to investing in Buddy Media, Facebook, and Twitter. Then he failed again, telling James, “the reason I failed is because I had big eyes.” He took on too many projects and lacked the right support from the right people. Gary says that the people he worked with were good people, but not good matches for what he was bringing to the table. Contrast this with the Brian Koppelman (episode #59) and David Levine (episode #85) interviews. They are an example of a good pairing, where one compliments the other and the whole is greater than the sum of their parts.

When the interview turns back to his book, Vaynerchuk says that some of “the case studies are crap.” Noting that it’s often helpful to learn what not to do, as what to do. Nassim Taleb terms this idea via negativa, the absence of something makes something better. The 3 F’s are an example from Dr. David Katz. who writes that fingers (not smoking), feet (not sitting), and forks (not eating crappy foods) can reduce your risk of death from the riskiest causes of death, by 75%.

In the interview James tells Vaynerchuk “I took your Amtrak idea and applied it to my own stuff and it’s fantastic how my engagement quadrupled on one post.” So what is the Amtrak idea? It’s about using your sawdust – your by-product – to create something of value. For Amtrak, it was tweeting out a pair of empty seats, and asking people where they would go and with who. But it didn’t stop there, Vaynerchuk writes that “when one fan suggested Justin Bieber as his preferred seatmate, Amtrak replied with ‘But where would Selena Gomez go?’ With one sentence, Amtrak reveals that is employees are our contemporaries, people just like us, with their fingers on the pop culture pulse, a sense of humor, and real interest in their customers.”

When Vaynerchuk prepared to start writing Jab, he read the negative reviews on Amazon of his other books, Crush It! and The Thank You Economy. In these negative reviews he found what people were looking for, he tells James that “a lot of people said, this is a great book, but this is a why book, I want a how-to.”

The interview ends with Vaynerchuk saying that his next book might be about parenting (or something else that’s new) and he tells James he’s found a good middle ground by balancing extremes. He says that flip flopping didn’t work:

I’d be working and then I’d need to spend more time (at home) and I’d just leave and cancel some meetings and get home at 5:30…but there was no system…it didn’t work… I now work eight a.m. to midnight. I mean I walk into my apartment at midnight…I’m a workaholic…on the flipside my weekends I’m completely all in with my family now, no looking at the phone answering email.

Vaynerchuk has found one of the Secrets of Happy Families, that happy families aren’t accidental. Bruce Feiler wondered if there was something that happy families were doing different, and there were. One untapped medium – that Vaynerchuk would love – is having a family brand. Stephen Covey applied this thinking to what his family is doing, Feiler writes:

One of Covey’s real innovations was applying a similar process to families. He suggested that families create a family mission statement. “The goal,” he wrote, “is to create a clear, compelling vision of what you and your family are all about.” He said the family mission statement was like the flight plan of an airplane. “Good families— even great families— are off track 90 percent of the time,” he wrote. What makes them good is they have a clear destination in mind, and they have a flight plan to get there. As a result, when they face the inevitable turbulence and human error, they keep coming back to their plan. Covey said creating his own family’s statement was the most transforming event in his family’s history.

James gives the book two thumbs up, saying, “This is not a BS book. This works.”

*Did we really miss this? This interview was release on 1/31/2014 but these notes are from January 2015. Some things likely changed in between recording and now. This episode also has a 20 minute rant from James at the start, you can probably skip it.

As always, let me know what I messed up or what you want to see more of – @mikedariano If you want a weekly summary of everything I write, you can find that here.

#54 Gabriel Weinberg

James Altucher interviewed Gabriel Weinberg (@yegg), CEO of DuckDuckGo to talk about privacy, building technology companies, and his book Traction: A Startup Guide to Getting Customers. For the most authentic – and meta – experience, I used DuckDuckGo as my research tool du jour.

The pair begin the interview with some banter about how Weinberg introduces himself at cocktail parties, even though he tries to avoid it. When it does happen he says, “we’re a search engine like Google.” The DuckDuckGo site there are three tenants to the company where they differ from Google, “real privacy, smarter search, and less clutter.” Altucher goes on to dispute the idea that Weinberg’s service is “cleaner” than Google, but Weinberg answers with a fair point that most services are all about design and it’s a preference thing, drawing the analogy to web browser choices.

Pragmatically, DuckDuckGo works differently than Google, hence the different results. Where as Google indexes pages to find later, DuckDuckGo rather looks at your query and qualifies what you’re asking, and then returns the best page results. If you search for a person like, “Stephen King” you get an excerpt from Wikipedia, then a link to StephenKing.com, another Wikipedia link, and then an About.com page. Whereas A search for the movie, “The Shining” returns; Wikipedia, IMDB, and Rotten Tomatoes.

WPStephenKing

As the interview continues, Weinberg explains a feature of Google search I had never considered:

“One other point.  You mentioned a more nuanced benefit of DuckDuckGo, which is this constant filter bubble, where at Google you know they’re basically showing you links that they think you’re gonna click on but not necessarily the most objective researched links.  And if you’re like you know you’re a democrat or republican, you’re seeing those kind of links and not opposing viewpoints.  I believe that is pernicious, especially in politics, and that is a benefit of DuckDuckGo.  I usually don’t say it ’cause it’s kind of nuance and hard to explain, but since you brought it up, I thought I’d just mention it.”

This was clear to me last Christmas when I kept seeing ads come up for an obscure gift I was researching. How, I wondered, did all these sites have ads for this quirky thing? They didn’t, but they were members of the Google Ad network. I had searched on Google and the ads I saw were specific to that. I had never – naively – considered that my search and browsing were dictating my ads.

It’s not just the specific sites you and I browse, it could be our phone calls too. A Stanford research study found out that they could infer if you were in a relationship, had heart problems, or  wanted to start growing weed in your basement just based on the meta data on your phone. The study authors concluded these things despite not hearing a single piece of conversation.

Back in the interview, Altucher asks Weinberg how he got started in 2007/2008. Weinberg was just coming off a company sale and was building DuckDuckGo piecemeal.

“I had just sold a business and was kind of doing personal projects and did a bunch of projects enhancing Google in ways that I felt Google was lacking, so removing spam, adding these instant answers, and then thought you know what, I could put some of these together and kind of grow my own search engine and see if anyone’s interested.  That was the genesis.”

That genesis has led to DuckDuckGo on the new iPhones.

Weinberg’s book is based on his experiences. As his company grew they found different things moved their stats in different ways. For DuckDuckGo Weinberg said they used; SEO (searching Google for ‘new search engine’), Reddit ads, content marketing, microsites, print, billboards, TV and now enterprise partnerships like the Apple deal. Each of these avenues led to specific company benchmarks.

After the DuckDuckGo birth story, Altucher asks about Names Database and its sale to United Online for about ten million dollars. Weinberg was a co-founder, and he and James make a strong case to never take investors if you can help it. Weinberg mentions a post he wrote about it, Paths to $5M for a startup founder.

The gist of the post is reminding people how values change when you divide by 4 rather than 2. Easy math stuff, but the post was popular, and listed on HN because we like people to tell us obvious things. We know to do more pushups and eat less pizza, but only after hearing a celebrity interview do we get on board.

One sad note, when I searched DuckDuckGo for “the path to five million dollars weinberg” I couldn’t find the link it in the first thirty results. On Google it was number two.

Back in the interview Altucher adds, “I don’t want to say you can start any business, but look, if you can start a business that has a million dollars in EBITDA, you could sell it and make a lot of money for an individual person who’s never had money before.”

This being the second interview that mentions it, I had to DuckDuckGo EBITDA. It stands for, earnings before interest, taxes, depreciation and amortization. Without harkening back to your college accounting textbook (I don’t have mine anymore), that figure serves as a proxy for how profitable a company is based on its current working assets. Apple has an EBITA of 10.38, Walmart one of 8.27, and Macy’s one of 6.90.  Each introductory article about it also warned that it can dress up an ugly financial bride.

Throughout the interview Altucher brings the conversation back to the DuckDuckGo policy on privacy, and Weinberg says that they do that and more; but he never makes a solid case for me about what else DuckDuckGo does well. One differentiator is that don’t develop anything but better search. Weinberg says they have 20 people and they focus “almost zero” on their own advertising. Another tactic is their pursuit of the open source framework of DuckDuckGo’s instant answer service. About it Weinberg says;

“we’re hoping to have you know thousands of people out there working on an open source platform developing these answers, and that’s why it’s all open source.  So any user can suggest you know an instant-answer source or idea.  You know it could be money related, some better stock source.  And then you know you could develop it; someone else can come along and development it.”

Toward the end of the interview Weinberg gives some good advice about how he figures out the “inflection points” for DuckDuckGo, and acts accordingly to those markers. Deciding if your primary goal is to get traction or be profitable will lead to the metrics that dictate your actions. In the case of DuckDuckGo that meant first getting the service running well enough that people could switch to it, then it was getting to 100 million searches each month, and now it’s the pursuit of 1% of all searches. Each step leads down chosen path.

Altucher then asks how someone can tell if they should give up, what if they have a path but arriving at each inflection point is taking a lot longer than they hoped. Weinberg first suggests looking for any “bright spots.” This idea has been most popularly explained by Kevin Kelly’s article on 1,000 true fans (even Seth Godin linked to it!) where he writes;

“A True Fan is defined as someone who will purchase anything and everything you produce. They will drive 200 miles to see you sing. They will buy the super deluxe re-issued hi-res box set of your stuff even though they have the low-res version. They have a Google Alert set for your name.”

One tip from Weinberg’s book is guest posting, and both agree that is a great way to build traction for your business. Another is to build and show your expertise through blogging like Bryan Johnson from Braintree. Altucher shares that he has a friend that’s used educational blogging successfully for SMS marketing, and this has been Pat Flynn’s system from the beginning.

A third tip is to use the underutilized area of e-mail marketing. Tim Ferriss, Tim-freakin’-online-self-promotion-experimentation-king-Ferriss, has just started email marketing. Check out his interview with Ramit Sethi for a great breakdown on the what and why.

The remainder of the interview between Altucher and Weinberg is about his book, Traction.

Researching note: The search experience on DuckDuckGo was overall slower and not quite as helpful as Google. I have a pair of theories. The first is that I already basically know where I want to go. For many searchers I’m looking for the Wikipedia article and they do come faster with Google. Other times I need something from my history. The second theory as to why DuckDuckGo didn’t do anything for me was how unfamiliar I was with the experience. It looked and felt different and that slowed me down. Not much, but enough that I noted.

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