#60, David Meltzer, Co-Founder of Sports 1 Marketing, and Peter Goldstein, Entrepreneur and autho...

Welcome to From Startup to Grownup, the podcast. My name is Alisa Cohn. I'm an executive coach, an angel investor, and the author of From Startup to Grownup. Each week I talk to founders, creators, advisors, investors, and builders of all kinds about their insights and experiences in going from startup to grownup. Welcome back. This is From Startup to Grownup, and today we have a really fascinating episode, which we recorded at Web Summit featuring David Meltzer and Peter Goldstein. David is the co-founder of Sports One Marketing and formerly served as the CEO of Lee Steinberg Sports and Entertainment Agency. David is also a motivational speaker, an author, and I'm positive you've seen him on Instagram and YouTube. Peter is an investor and an entrepreneur and the author of Masterclass: The Entrepreneur's IPO, an insider's roadmap to taking your company public. This episode is really about what you do when you fall. David ran the renowned Lee Steinberg Sports Entertainment Agency, which was the inspiration for the movie Jerry Maguire. He had access to everyone in the world. He was worth over $100 million, and then he went bankrupt. Peter was an entrepreneur who started his first company at age 24 and sold it at 30. After a number of successes, Peter also lost almost everything. During the recession of 2008. We talk about money, we talk about relationships, we talk about how to handle uncertainty, and we talk about the need to ask for help. So get ready to hear from two seasoned entrepreneurs about what it's like to lose it all and then what to do next. So please enjoy this great conversation with David Meltzer and Peter Goldstein. Oh my God, I'm so thrilled to be here at Web Summit and have the amazing David Meltzer and Peter Goldstein with me. What an exciting conversation we're going to have. David, I want to start with you because you have such a compelling story about really having risen through the ranks or risen to the top when you were in your 20s, and then you had kind of a crash, right? So tell us about that and tell us how you got to be the international man of mystery that you are today.

Well, I think a little crash would be an understatement. And it's ironic because that international man of mystery today is nothing like the man that I grew up to be. And I look at how my genetics and energetics have worked together in my growth. And the lesson of the hardest thing to realize, because when you dream about buying your mom a house because you're so poor, you can't afford food, and 9 months out of law school, you could not only buy your mom a house, but you can buy whatever you want. And by the time you're 30, you could buy more than whatever you wanted. And then to lose it all and have your identity tied to your bank account. My identity was so closely tied to my bank account. Imagine having over $100 million and your bank account going up $100 and feeling good about yourself and having it go down $100 and having you feel bad about yourself.

So intense. But what happened? Give us the sort of the, what actually the story of what happened.

What happened was, and this is tied into the lesson for entrepreneurs, I believe my own bullshit. And unfortunately, energetically and genetically, I'm a liar, a cheater, a manipulator, overseller, and backend seller. And in the short run, that works. But there's a saying, if you cut the line, someday you're going to have to go to the back of the line. And the truth vibrates the fastest. And so I went from a world of not enough where I was a victim. Everything was happening to me. Single mom, 6 kids, packing my dinner in a paper bag to a world of just enough for me, lying to myself and others of what I wanted them to think I am instead of who I am.

Mm-hmm.

And buying things all the time to make me happy, buying things I didn't need to impress people I didn't even like. And it all came crashing down. It came crashing down when I realized that I hate my mom, I hate my dad, I hated my best friend, and now I hated my wife because they were the only 4 people in my life that was telling me the truth. Everyone else was lying to me.

Wow.

And they told me that I was lost. I had lost my values. They told me to take stock in who I was and what I wanted to become. And I ended up losing over $100 million to learn that lesson.

What was—

you're running a business and then you—

I ran the most notable sports agency in the world. They made the movie Jerry Maguire about my firm. And I was worth— it wasn't just being worth over $100 million. It was having access to what even billionaires couldn't afford. Sidelines at the Super Bowl. The cabins at the Masters, or even more importantly, like, just all the people that people wanted to be around. Every athlete wants to be a rapper. Every rapper wanted to be an athlete. Every billionaire wanted to meet the rappers and the athletes. And I had access to them all. And like I said, I had to take stock in who I was. And ironically, I felt very punished when it happened. Ironically, Everything I wanted in life happened because I went bankrupt.

Yeah. So bankrupt. So you went bankrupt because what happened?

I didn't ask for help. I honestly— and I'll get to specifics and you'll see why, because I think it's important how easy you can lose over $100 million.

That's an important— because people don't really envision that. No, that's not something people imagine.

So I always— 9 months out of law school, millionaire, never had any big failures. I just kept gaining wealth and I had a private bank where I had a $40 million line of credit. And in 2008, because I didn't ask anyone for help and I knew everything, I got into a lawsuit and I had extended myself, great investments, but I had heavy cash flow and I went to go draw down $5 million on a $40 million line of credit. And they tell me in one minute, Sorry, we've maxed out your line at $1 million. Now, that could have been avoided easily. There's many people that had situational knowledge that banks could cut off your line like this, especially when they were going under. But yet I knew everything. And if you think you have $40 million liquid and it's reduced to $1 million, even some of the greatest business minds couldn't help me.

Totally.

Wow.

David, that's so dramatic. And I'm gonna get Peter into the conversation because Peter, you also had, you know, in speaking of 2008, some of the worst difficulty in your life. So tell us about, about your background and then kind of what happened in 2008.

So I'm really a self-made entrepreneur. I started my first company in my early 20s. I had my first exit at 30. And so I learned from bootstrapping without any business experience, without any capital.

What was the company?

I was in New York City. It was a specialty food company. I had started a career in the food industry and was working at the Rainbow Room, a very, very well-known and very well-established, and, and I thought that was my goal until I saw the masters who were the iconic New York restaurateurs who were working 50, 60, 70 hours a week. And I said, that's not what I want to do. And I left to go embark on my own, the first business on my 24th birthday. I went and got my first business license at City Hall. I'm down at Center Street in Manhattan. And I built that business and I sold it at 30.

Mm-hmm.

So, I experienced my first exit. And since then, I'm now 60. So, for the last 30 years, I've been working with entrepreneurs as a company builder, advisor, investor, board member. And really, the passion that I have is for working with other entrepreneurs and helping them realize and envision their goals.

Yeah. We have a lot in common. So, after you sold your startup, What, what kind of transpired that you really hit the bottom and had to recreate yourself in 2008?

It wasn't until 2008. I had very good success thereafter and had got to the point where, like Dave, I was very focused on probably what I would say now are the wrong things— custom home, cars, the houses, the lifestyle. And I had hedged my portfolio between the capital markets and real estate. Because that was a good play until the Great Recession came and all of the real estate that I had was jumbo high-end South Florida real estate.

Hmm.

So, if you go back in time to that, that was ground zero.

Totally.

Right? And they were all self-financed. So, I took all the money that I had that I didn't want to be in the markets to hedge against and no financing, put everything in. And then the ultimate happened that in our lifetime we had never seen before. Which was both crashes occurring at the same time.

Yeah.

And in a matter of months.

Yeah.

Not with the same digits Dave had, but for me as a self-made entrepreneur, everything that I had planned and worked for had been reversed in a matter of months.

It's so intense, you know, and I wanna ask both of you in a minute, well, kind of what it took to grow out of that, but I just wanna pause for a second and talk about money and stuff and you know, having a lot of money, because a lot of people who are listening, my listeners, dream of having a lot of money. But there is a downside to that. Dave, could you speak a little bit about the downside to sort of having a lot of money? Like, it seems like such an abundance. What could go wrong?

Yeah, well, money is an amplifier because money allows you to shop. And if you shop for the right things for the right reasons, it has great power because it's amplifying the right reasons. When you're buying the wrong things for the wrong reasons, that is amplified as well. And the behaviors that are aligned with the amplification are also amplified because you have more power to shop. So you buy more alcohol and more drugs and more of the private airplanes and more of the South Florida real estate. And it amplifies the bad behavior. And so it causes these great falls. I will say one thing because I've lost a lot of money. I always love people like, I didn't lose as much as Dave, so I wouldn't know what Dave knows. No, I believe 100%. When you lose everything, it's worse. If you've only— if you only have $10,000 and you lose it all, it's far worse than losing over $100 million. Yeah, because you don't know more. You haven't gotten all the things that I have received from owning that. And so I think it's really important for people. Look, when you hit ground zero, the lessons from this podcast I want you to learn from Peter and me is, okay, what do I do now?

Yeah, that's great. So, Peter, what do they do now? So what happened to you? You lost it all in a matter of weeks or months. I mean, it was very quick, and obviously you weren't expecting it, even though you were taking risks, but probably didn't feel that way. Also, probably you were on top of the world thinking, I can do no wrong. Talk about that time and talk about a moment of truth maybe you had as this was all kind of crumbling around.

I think the moment of truth for me to start there was when I realized my dream of building a custom home with my family was gonna be lost. That I had the goal and the vision that was a driver for me. And then all of a sudden I realized the bank's gonna take it away. And that was in the middle of divorce, in the middle of a health crisis. So those 3 of the top 3 life stressors all happened simultaneously.

Yeah.

And the, the, the lesson that I wanna share with the audience is at a certain point, it was a journey, so it wasn't there from the beginning, but at a certain point I realized I need to embrace the uncertainty. And that's what I would wanna share with the audience, that we all have uncertainty of different magnitudes at different different forms and different ways in our life. But the ability to embrace that and then turn it around to look at the personal growth and as entrepreneurs, the entrepreneurial innovation that can then come from realizing if you've done it before, if you have the skills, you have the desire, you have the motivation, go back to taking that uncertainty and embracing it and turning the table on it. I love that.

That's such an important message. Like, was there— can you sort of talk about the moment you I need to embrace uncertainty because when bad things happen, all of us have a tendency to be upset, obviously not see the opportunity, obviously, and frankly blame other people. So whatever of those things you went through, what was the moment that you thought, I need to just accept and embrace this is happening?

I think there was maybe not one per se moment, but it's a culmination of many different things because all of this was happening simultaneously. Unfolding in real time to ways that I'd never imagined. And that moment of, okay, there's— I have— my savings is gone. I don't have a cash flow. I have to figure out how to put one foot in front of the other. And then where Dave and I share a lot of philosophy was I had to start asking people for help and humbly put away my ego, my identity, and say, okay, that's that's not going to get me there. Yeah, go back to what will. And it was at a certain low point, is actually also where I met Dave, um, and Dave's showing me that you can publicly talk about your failure.

Yeah.

And then ask for help.

Yeah, that's so powerful. What was it like before you were able to talk about your failure? Because I think that is— you— we talked earlier and you were saying, you know, on Wall Street you would never talk about that. And I think that's so true. People People keep secrets.

Yes.

They hide, they keep secrets, and then shame grows inside of them. So what was the sort of some of the catalyst that allowed you to see, I'm going to start asking for help and then sharing my story?

It took a while. I had to really give up my attachment to my identity and get very humble and get very real. And then at the realization that I can't do this by myself. I'll fail again. And there was a pivotal point in the crossroads where I'm like, okay, I can go left or I can go right. And the only way for me to rebuild myself is to bring in the help of others.

Yeah.

Mentors, family members, trusted advisors, and ask.

Yeah.

And then put together, perform. You have to perform. So there's no free ride anywhere in any of this. But that ability to recognize I can't do this by myself, and there are people that care and love and want to contribute and would be happy to assist in the next steps of my journey.

Yeah, that's beautiful. You know, Dave, that's really the message that you've kind of created. So like for you, once you began to, let's say, recreate yourself and reinvent yourself, how did you come to this sort of message that you now have, which is gratitude and happiness? And, you know, and frankly asking for help.

Forgiveness, which is a big part of it today for everyone. I'm actually doing research on it to help people around the world understand forgiveness. But the defining moment for me happened 2 years before I lost everything. Some people thought it was the defining moment when I had to go tell my mom that I was so rich and the only reason I wanted to be rich was to buy her house and I didn't take my name off of her title. So I lost my mom's house. And I had to tell her I was bankrupt and you have to move. But my real defining moment was when I came home at 5:30 in the morning with a rapper named Lil Jon after lying to my wife about having a business meeting, going to the Grammy Awards intoxicated, and my wife telling me, I'm going to leave you because I'm afraid you won't be alive if I stay here. And I don't want our 3 daughters under 8 years old to witness what's going to happen to you. And I told her at the time, as I did when my dad tried to tell me I was on the wrong direction, my mom and my best friend, I said, F you. How dare you talk to me this way? Look around you. Who do you think did all of this? And I went to sleep and I woke up in hate. And I thought the hate was for everybody else that was telling me the truth. I looked over in the closet, and the reason I hated my father is he gave me a jacket on my 30th birthday to tell me money doesn't buy you everything. Hang this closet with no pockets to remind you you can't take anything with you when you're gone. Son, you're just like me. And I said, I'm like you? I'm nothing like you. You're a liar, a cheater, manipulator, overseller, and a backhand seller. I hate you. Why do you always have to prove me wrong? And make lessons? Why can't you just celebrate my birthday? And now I sat there on the bed hating everyone that was important to me. And that jacket was in my closet. Hadn't seen it in years. And there it was staring at me. And I still get choked up because I remember breaking down crying, saying to myself, I don't hate my dad. I don't hate my mom. I don't hate my best friend. I certainly don't hate my wife. I hated myself. I was the liar, the cheater, the manipulator, overseller, back end. Until I took stock in who I was. Gratitude. I was going to have the perspective of finding light, love, and lessons in everything. Forgiveness. I was going to live at ease and identify the dis-ease. Accountability. I was going to not only take account— accountability via responsibility, attraction, and my participation in a perception to learn from it. And then I was going to live inspired. The biggest shift was just having faith. And I don't care what religion, philosophy, spirituality, or theories you believe in. I challenge all your audience. I believe in best option faith. I said that day, I believe there's something bigger than me, an omniscient, all-powerful being source that loves me, protects me, and promotes me more than my mom. Therefore, no matter what happens from today on, I know as a human being, I'm incapable of identifying or understanding or knowing what outcomes really mean. So 2 years later, when I had to go to my mom's house and tell her I went bankrupt and I lost her house, I was looking at that moment. I didn't believe it, how I wasn't being punished. I know he felt punished. I felt punished. But I started looking on that day, how am I being protected and promoted by this? And now, 15 years later, it was the defining moment, losing everything. It allowed me to make more money. It allowed me to help more people. And it allows me to have more fun. The number one peop— reason people pay me millions of dollars for my advice is not because I made millions of dollars. It's because I lost it.

Talk about turning, turning crisis into opportunity. Yeah, I, I love what you're saying. And I think I was going to talk about sort of spirituality, and I'm just curious, you know, how you now look at, you know, sort of the way life unfolds and how you really teach and coach in, in terms of faith and spirituality. And as you were saying, forgiveness.

So I teach people the 3 time zones. The infinite past limits us only by the meaning that we give it. So I'm a good example because I changed the meaning of bankruptcy.

That's true.

The infinite future is limited only by one thing, your self-image. So I coach people on giving meaning, finding the light, the love in the lessons in their past, failure, setbacks, mistakes, void shortages, obstacles, historical relevances even, and putting them in a trajectory to increase their own self-image, not decrease it. Mm-hmm. We talk about the door closing behind you. Well, if you believe that you're now in a decreasing, spiraling situation of victimhood and punishment, that's where you're gonna end up. Not me. Let's take the light, the love, and the lessons and know that we are now gonna be in a better place or a better situation. Now the real coaching comes in. What are you gonna do about it today? What do you want? Who can you help? How can you get it done? And teach them to prioritize what's important. The energy crisis that I'm resolving today, I'm not an engineer. The energy crisis is between I am and this is what I want people to think I am, especially our children. I teach my children what I am, not what other people think they are or wondering what or hoping that they think they are something they're not.

Yeah. Is there any doubt that Dave's motivational speaker. I don't think so. That's very powerful. Peter, what about you? When you, you now have really devoted your life to helping entrepreneurs grow. You know, we have a lot in common because we're talking about personal growth of entrepreneurs, and I work really on the inner life, and you work on helping them shape their businesses in order to take them public. Talk about that process and, and talk about how— I guess I really want to say, like, what you you've personally learned from, from helping and mentoring other, other founders?

I started with taking my own companies public. So I think as an advisor, the most critical thing is that you really can own what the journey is because you've completed it.

Yeah.

And I had done it several times as founder and then as a co-founder. And one of those companies is still trading on NASDAQ. So the lessons that I learned from being on the issuer side, as they call it, or the company side without a guide, without a shepherd, without anybody to really show me the way.

Yeah.

Or what I now want to bring to the entrepreneurs that I work with. And I took that first experience. I have my own boutique investment bank, which I started from scratch, funding entrepreneurial companies, emerging growth companies. I also manage a fund that also invests in companies. And the ultimate for me as an entrepreneur was to be able to reach that pinnacle. Of being able to go ring the bell at NASDAQ or New York Stock Exchange, which is what we work with now. And so we work backwards. We work with companies and entrepreneurs that have that vision, and we look at what would be required in order for them to be a successful, sustainable, publicly traded company.

Yeah.

And then where are they today?

Yeah.

And then we look to fill in those deficits and those gaps.

I love that. What's an example? Either an example or, you know, basically like how can a company right now think about where are they, where are they going and how are they going to get there in terms of IPO readiness? An example if you can give it or even just specific tools.

I mean, I'll start with, with, I, I, I like to look at the timing. So really to prepare properly 24 months, 18 months before you would envision having a symbol is the ideal time to really, because it's a, it's a huge commitment for any entrepreneurs listening who want to go down this route. Start off first with your commitment and an understanding you're on a journey for the next 2 years to just reach the point of getting listed. And then there's life as a sustainable public company after the fact. And with that then comes being of the mindset to understand what you're going to take yourself, your employees, the stakeholders. And what I like to do is debunk the myth of Wall Street. You do not need to be a unicorn. You do not need to have $100 million and 20% EBITDA and showing the hockey stick growth. You know, most entrepreneurs don't realize that both NASDAQ and the New York Stock Exchange welcome smaller early-stage companies. So as an example, you know, I like to work with socially responsible companies. It fuels another part of my passion. We listed a company in the New York Stock Exchange American, which is the beginning platform So you don't have to be a 100-year-old company doing X, right? This was an earlier stage company. They work with providing solutions to children who have issues in the pediatric side with a medical device that was not otherwise on the market. We raised them close to $20 million.

Wow.

Which now gives that company a runway in the capital to be able to build out their business while they're, of course, serving a huge need in, in working with children.

I love it. So if a company is thinking about going public right now, it won't be right now because it'll be 24 months, but what are the specific kind of like tactics, milestones, you know, things they have to look at? So it's like not what Wall Street says, the myth of the unicorn, but it is what, what, and how do they then have to think about putting the pieces in place?

Yeah, so I think the first, first and foremost is if you're thinking about this and realizing you're the class of '24, you're the class of '25, the markets are, are in a very difficult time for IPOs right now. So in that cycle, the life cycle of the markets, knowing that you have to prepare, and if you don't start now, you're still 18 to 24 months away. So prudent management, I like to say, is beginning now. And where does it start? Starts with a roadmap and starts with the assessment of where you are and and then we look and we break down all the different aspects. So business readiness, diligence, you know, your audit, you know, your criteria for meeting the SEC and the NASDAQ listing requirements. And we do an assessment of that and then we create a roadmap going forward. So it starts with bringing in an advisor who understands how to work towards the listing metrics because it's a very complex journey from here to there.

Yeah.

So, There is a lot I could talk about and unpack there, but it really is focusing probably on the fundamentals of business readiness, you know, diligence, and the acceptance of the fact that you now as a founder, CEO, and/or partner are gonna be bringing in and inviting in a whole new universe to come inside of your company.

Yeah, and then being a public company CEO is a whole different thing. You know, David, you've worked with so many kinds of businesses, bootstrap businesses, public companies. What would you say is a diff— What would you say is the advantages to not going public? And then what would you say is the key thing you need to think about as you're going public and as a public company CEO?

I think there's a lot of advantages of not going public, which is mostly under the context of influence. When you go public, there's so many influences on your decision-making as a leader. But what I like about going public, or the number one thing between between all of the different companies that I deal with, from the chairman of Gulf Oil to a young entrepreneur who is working on a bootstrap budget, is that I want people to focus in on shareholder value. I want them to focus in on how their skills, knowledge, and desire determine their timing and risk tolerance, and how can they utilize their businesses in order to effectuate elevate the greater good or the value. And I break it down real simply when I coach executives, no matter what level I start with, this is about shareholder value. And there's only two ways to provide value. I know people, I've studied physics, quantum physics, metaphysics, micro, macroeconomics. I have learned all the academic side of things, but it's real simple to me. I have learned shareholder values determined on two things. One, giving people more of what they like or taking away all or some of what they don't like. That's how we provide value. And if we can articulate the quantitative value and execute on what we like and what we don't like and have less influences in the decision-making process so that we can maximize not only our individual skills, knowledge, and desire, but the collective conscious, then we can facilitate a abundance, more than enough of everything for everyone. And the thing that I like about IPOs and public companies is it does have a more abundant philosophy to it, right? We're sharing the value with more people and more people are experiencing with very little effort sometimes some great abundance. There's more than enough. And so I think understanding who we are taking inventory of the inner work, which Alisa, you are amazing at, is absolutely a positive in what we do to be abundant and share that. And that's why experts like Peter, he's even written a book, a roadmap for people so that they don't have to pay the dummy tax. I mean, think about just between these two dummies here. I live in California. You live in New York.

Yeah.

People complain about the taxes and I'm like, you're complaining about like a weather tax, dude. Who cares about 12%? Try 100% times 10 when you're talking about dummy tax and people like him are giving it for free. They're paying your tax for you.

I love it. I'm glad that you mentioned Peter's book, The Entrepreneur's IPO: An Insider's Roadmap to Taking Your Company Public. You know, as we sort of wrap up here, Peter, I guess I would ask you what specific— maybe what do you— I'm going to ask you both these questions. What do you wish you had known earlier on your journey?

Expect the unexpected. No matter how much you plan and think you have it all worked out and think that everything is going to go just how you want, expect the unexpected. Multiply that by some large exponential number. And be prepared. And when it does go, go wrong, embrace it and figure out how to leverage, you know, your gift and your talent. Took me a long time to learn that I can't do it all.

Yeah.

And now I just focus on my highest and best and expect that the unexpected will happen and embrace it and enjoy the journey.

Life is not linear. David, how about you? What do you wish you had known earlier on your journey?

Well, the advice would be to ask for help, but what I wish I knew was about something called ignorant arrogance. Not only my, my own ignorant arrogance where I don't know what I don't know. And so I pretend like I do. But the ignorant arrogance that also is of people, especially with social media, of hurt people hurting people. So I don't know what I don't know. And I project that onto you, but I do it by attacking you off a silly thing sometimes. But the number one thing that hurt me the most wasn't the ignorant arrogance of myself, wasn't the arrogant ignorance of the haters, as they call them today, but it was the arrogant ignorance of the people that loved me the most, that loved me so much that they were more afraid for me to fail than I was. They were more afraid for me to get hurt than I was. So all the people that loved me that said, oh, but you should be a real lawyer. Oh, you should do this because they were protecting me because they were so afraid of me. Instead, they were limiting my self-image and my potential. And so I think if somebody could have explained all 3 types of ignorant arrogance, it would have led me to an ignorant, humble perspective that I don't know what I don't know. And I want people to know that I don't know what I don't know. Therefore, I will ask for help. For those that do know what I don't know, like about IPOs and understanding why Peter is a close associate of mine and friend, because he's empowering others to empower others to make a lot of money, help a lot of people, and have a lot of fun.

I love it. So good. Last question. What— for both of you. First, you, Peter. What advice do you have for founders as they grow, as they continue to grow into leaders on their journey?

Speak the truth. Starts and stops there for me. Speak, speak your truth.

Speak your truth.

Not the truth that you want others to hear. Bring your truth 100%, embody it, live it, and stay 100% focused on your truth.

I love it. David, how about you? Advice for founders as they grow into leaders.

Know your who. The fastest way to get to where you want to be is know who is sitting in the chair and have them pull up a chair, but also know who you can help to pull up a chair next to you. Here is my icon of entrepreneurship right here, reaching up for help and putting back a hand to help others as well. If you can build a community, which is so much easier today with social silos, a total addressable community of 7.6 billion people, But if you build a community of people that want to help each other and know people that can help each other, you will have a lifetime community of people that will buy from you and sell for you. And abundance will follow.

I love it. You guys, thank you so much for taking your precious time here at Web Summit to talk to my listeners. It's really been a valuable conversation. So thank you so much for coming.

Thank you.

Thank you.

Thanks for listening to From Startup to Grownup. If you like what you heard, Give it a review on Apple Podcasts so other people can find it. And if you know of a founder or someone else who is meant to be on this podcast, drop me a line through my website, alisacohn.com.