095: David Katz - Building a Business That Reflects Your Purpose and Values

Are you thinking about how to grow your business with near and offshore staffing, but you're also wanting to make sure that it's reliable, cost effective and really well done? I think Doxa Talent is the way to go. Here's why. They don't just fill your jobs. They bring integrity, top talent and a people first approach that's hard to find. I've known the people at Doxa talent for over 20 years now and I say that you can count on them. I have talent. Talk to Doxatalant and you won't be disappointed. Go to doxatalent.com Bill G. Again, that's doxatalent.com Bill g. One more time. Docsatalant.com Bill G. Check it out today. How do you create a business that scales massively but also reflects your highest purpose and values in life? One that you can be proud of and yet makes a huge difference in the world? That is your legacy. That's what today's show is all about. Purpose and value scaling on a massive global basis. Listen in. Hello and welcome again to the Scaling Up Business podcast. I'm your host and growth coach, Bill Gallagher. On the show with me today is an entrepreneur who's going to share a story of our work at work in a really unique and cool business. I hope you love it. I hope you get a lot of it. Welcome to the show. David Katz.

Hey, Bill. Thank you very much.

So, guys, David, he's known in the entrepreneurial world. He'll tell his background a little bit, but he's the CEO of an organization called the Plastic bank plasticbank.org and he's going to share his story of developing that business, what they do and all of that. So I'm so glad to have you. Are you in Vancouver today?

Yeah. Thank you, Bill. Pleasure to be here. Yam in Vancouver. It doesn't seem like I'm here very often, but I am today. Vancouver is home and headquarters for the Plastic Bank.

That's awesome. I will be there in a few weeks. I'm about to get on the road. I'm going to do Dallas, Honolulu, Toronto, Vancouver and then come back home.

All beautiful. Vancouver will be the best. You'll be full cherry blossom season.

Awesome. All right, so tell us about, kind of give us a little bit of your entrepreneurial background. How did you become an entrepreneur? Where'd that begin? What other business have you done? Take us to what led you ultimately to the Plastic Bank?

I've been an entrepreneur my entire life. I've been executing since I've been eight. It was always landscaping, paper delivery, everything else that I could do to escape the confines of my entrepreneurial family. My parents were immigrants and worked hard and expected of course, their children to work hard alongside them. The difference with me to an employee was that I was never paid. And if I wanted any sense of freedom, I had to go and earn that as well. Not only did I work for the family business, but then was creative. And I think that what that story reveals ultimately is the paradigm. Knowing that I as well was capable of starting and launching and creating an organization at any age. I think that was the gift that my parents gave me, was the paradigm that that was possible. Where many don't have that.

What did they do? What was there?

Yeah, my parents were in the tavern business. We had taverns, we sold beer by the glass. They were in the hotels as well and very blue collar, you know, my dad was progressive at the same time. And back in the early 70s, growing up on the west coast of Canada, this is where strippers just showed up. We were living in Ontario, strippers just showed up in Ontario and said, oh, that's it, we're going to go to the west coast of Canada, found a pub, closest pub he could find to a paper mill, put some four by eight sheets down on the pool table and had strippers. I remember being four years old and having kids saying, I'm not allowed to play with you anymore because you got strippers. Well, I didn't know what a stripper was when I was 4, but that was the progressive nature of my family, my father as well. This ability to go out and take an idea and to be able to continue to extrapolate that and see where value can be created and see what that looks like. Whatever your intentions may be on strippers, but there was a demand and we continue to grow from there. And then it was just beer by the glass and it was a really tough, hard business. And I as well learned about hospitality and a part of the gift in that, as we move that forward in this very blue collar type environment. And one of our taverns, you know, opened at 9am I mean it was, it was the drug addicted, the alcoholics, the street workers. And what allowed, what was allowed to be created in that space was this understanding of humanity and this ability to see inside of people and a love for people, no matter what the condition was and to see them as people and to be in the service of all people as well. And it is really quite an origin of where I am today.

Where were Your parents from.

My parents immigrated to Israel in 1967.

Immigrated to Israel or from Israel?

From Israel.

Oh, from Israel to here? Yeah. They were Yordim. They came down. Yeah. And found their way and. Well, my family briefly went, moved to Israel and then came back in some inability to sort of make it there financially, which I think for a lot it's hard to think. Today Israel is such a hotbed of entrepreneurship, especially kind of in the tech world. So you get into the tavern business, you learn this early on and then you go and you start to do things in your own world, in your own business. Tell us about that. And what did you do and ultimately what led you to the plastic bank idea?

We are all a summation and accumulation of all the experiences and decisions that we've all made in our lives. We are where we are today based on every single decision we've ever made. So it's a bit of a challenge to come back and say, well, how did the plastic bank come to life? Where was it created? Well, it's come from everything. It certainly came from this entrepreneurial experience. It certainly came from a time when I was at sea with my father, My mechanical genius father built a 47 foot sailboat by himself, sailed to Mexico and back. Long story short, we were offshore, sailing about 25 miles offshore Northern California in a 60 knot wind, 20 foot breaking wave where he has a heart attack. And at 15, I need to call a mayday to the US Coast Guard while he gives me his jewelry and last testament and lies on the forward bunk to he believes he's dying. And in that moment I recognized as well that if it was to be, it was up to me. It's really where I became this powerful individual knowing that I could overcome. And as we know in business, this is a commonality, this is a trait that we all need to come through. And I think that many entrepreneurs start with that as well, knowing that if it's to be, it's up to me. And so certainly that's a component as well, moving forward as well from that. Because my father was an early adopter of technology, back in 1981 he had GPS, had this up on the boat. And that's the way that I was able to understand where we were, communicate that to the Coast Guard. And then that took me forward through a number of businesses to a place where we started to develop and sell a GPS tracking technology for mobile workforce. We're embedding a device that combined a GPS location and latitude and longitude and combined with a modem transmit that out, overlay that on mapping, take into condition, engine state and a few other things and we're able to create routes and conditions and be able to help our customers lower the costs associated with the delivery of a service or a product. And see again, I was able to take forward all of the experiences my entire life, all the decisions I made moving that forward into a business. Had I not been in that experience with my father at sea, understanding gps, the power of it, this previous business that alluded to the plastic bank wouldn't have existed and that I built as a subscription based model over 11 years.

That's a pretty forward. I want to just underscore that for a minute because some people, the true geeks out there will know. GPS was invented in the 70s and was only first allowed for civilian loose in the 1980s and was not truly operational until the 90s. And what we all think of today as a mapping device. The early gps GPS systems came to replace a radio type system, Loran, which was in coastal areas and things like that. And so to have and be using GPS early on there it was a big deal. And early GPS only gave you lat long, they didn't give you mapping and anything else, not at all.

And it only gave you a locate every couple hours.

Right.

And so you'd also have to dead reckon from there. So you get a locate and you'd have to understand, you know, your heading and speed and all those things and then be able to plot that and then have an understanding of where you were.

Yes.

And so you'd be waiting for that locate. And that was a great origin of life as well. Again, it was up to me to overcome those things, to learn those, take those decisions, moving them forward, Understanding the power of being able to understand what your location is, where you are and then be able to communicate that in an automated fashion. That then went on to being a business solution allowed our customers to be able to also then automatically locate where their staff were, where their vehicles are, where's their inventory, what's occurring, a customer's calling, who's the closest person to send and everything else.

You know, I think about to this day like I have multiple clients using in their core business GPS systems. GPS to dispatch technicians, GPS to guide tours, GPS to locate vehicles, GPS to dispatch and organize crews. It's in at least half my companies.

Yeah, because technology today waze all of.

It, Waze, Uber Lyft, etc. Like all these things are geolocated and then combined mapping and networking. So were you Also, did you grow up sailing pretty consistently?

Well, I grew up on the ocean. That was the thing, you know. And so not only did I learn how to survive at sea, but I learned the beauty and the power of the ocean and being at the ocean's edge as a child as well. Not only just being on the sea as a family hobby, really, it was my dad's hobby. It was always chaos for us because he was so bipolar and it always turned out to be some chaotic episode. But I was able to witness the degradation of the ocean. I was able to be there and see that. And from a point where I was beachcombing and looking for these things that would wash up on the beach, thinking that it was some miraculous event that occurred that took some piece of evidence of some remote civilization on my beach, became ultimately the realization that it was just people's trash and it was just a continuous accumulation of that. I've been acutely aware of this for, for decades and I've been passionate about that. And my place is at the ocean's edge and I'm trying to protect that. That's what I'm doing. And that's the plastic bank in the end. So long story short, it's an accumulation of a lifetime of experiences combined with entrepreneurship, the ability to know that I can overcome challenges that I see them all the experiences that I took from building a small technology company to the acquisition and being acquired by a supplier and taking that forward into something that truly has purpose, that uses me. It is far bigger than me today, far bigger than who I am and I get to continue to be in the becoming of that and that is a life well lived. There's too many entrepreneurs that are sitting back thinking that they'll be happy when or whatever it may be as we.

Know what was the moment where you crystallized the actual idea of the plastic bank and created the purpose and the values. Can you share a little bit about that?

All occurred in a moment. And there I was through the entrepreneurs organization attending a university in Istanbul where Peter Diamandis is communicating Singularity University and the power of it. And what was to occur then, now this was later days in Neuro Global Tracking where I learned as well what it was like to not have purpose. I was able to grow a business. A core values led organization allowed me to be free. I grew a business that I could own and not have to work in, continue to exhibit. You know, we never had a month that we didn't have growth and I was purposeless and I felt, I felt that emptiness. So maybe it came to me at the very right moment, as all of life does, and being enlivened to the Singularity University. I attended an executive program in May of 2013, and it was during that event where Avi Reichental, who at the time was CEO of 3D Systems, the first publicly traded 3D printing supply and fulfillment company, was speaking. And I'm right next to the stage and there he is speaking about additive manufacturing, which was fascinating on its own. And he out pointed, pulls out this big brown belt that was printed into one solid piece of fluid. And it looked like the 70s belt with these little buckles and things. And fascinating. Now I'm there as well, mind you, with the idea that I am there to solve this ocean problem, because we do see what we are looking for. That is very, very important in a topic of discussion on its own. But there I am in this 3D printed belt and I'm like, oh, Avi, well, how much does the belt sell for? Well, $80. Great. Well, what was the material cost? Well, $10. And in that moment, not, I mean rudimentary, that there was a material cost and there was a margin, but what I saw in that very moment was that it was the shape of the plastic that revealed its value, not the plastic itself. 3D printed from a plastic filament. And it went through a process that changed the shape and it added almost a thousand fold value. And the same is true of any material that we see lying on the streets or in the ditch or in the beach. We just don't see the value in it because of the shape. And if we could change the way that we perceived the plastic, perhaps we didn't need to change the shape of the plastic, but the way we viewed the plastic, and perhaps that could be a origin of change. And I recognized that if every bottle, every piece of packaging, if all the plastic we saw lying in the environment was worth 5, 10, $20, there would be none, none would lie in the environment or in the bellies of birds. And so it was really the value that we placed on it. If we could change the value perception, that could be an origin of change. And how better to place value than to give it a name like the plastic bank, where we could reveal the value in the material to such an extent that it became cash to those who needed it the most.

So let me come alongside and underscore a couple things because I think it's helpful to look at. So one, you recognize a problem, there's a problem that you care about it there, and that's in the background. And then you hear somebody talking about putting plastic into a form, and suddenly that virtually worthless plastic material made into a shape that has utility suddenly has value.

Right.

And then you have the insight, oh, if we could add the value to that discarded plastic that was once used, we could transform this thing by bringing some more value to that in some way. Right?

Yeah. We didn't even need to add value to it. We just needed to reveal the value that was inherent inside of it. And I want to backtrack for a moment and express that I did not go looking for problems. I went there in the expression that there were solutions available and I needed to see them, because you do see what you're looking for. And I think this is a part of the challenge with everyone in this space, in the ocean plastic space, everyone's like, oh, there's such a, you know, there's such a conversation about the disaster that's unfolding, and everyone lies in that space and they only see the problems. And we need more and more entrepreneurs that are uniquely positioned to see solutions. And so I went looking for a solution. There's a, there's a, there's a, there's a nuance and a critical conversation in there.

Yeah. The Singularity University as a program, as an effort, has people focus on things that solve big problems. They start with that, then they go looking for solutions to them. When we think about many of the entrepreneurs that we encounter, many of them talk about being in the business they're in somewhat by accident. Oh, I just did this, then I sort of did this, that. Then I found I was sort of good here. And then I stuck around and they haven't articulated or even thought about the why or the purpose, the motivation of their work. They're just going along, they're like, well, it's here to provide my financial security or give me freedom, or I was working with a company earlier today, just like that. I'm like, yeah, there's always something more. If you could tap into it, you'd be a lot more powerful. So you went looking for it and you realized there was an opportunity to create a solution to. To this. So tell us about that. Tell us about the solution.

Well, the Plastic bank is an ecosystem that reveals value in what is viewed as waste. Yeah. There's a variety of models. We best exemplify it in being the world's largest chain of stores for the ultra ultra poor, where everything in the store is available to be purchased using plastic carbon. And I'm most proud to offer school tuition and medical insurance and wi fi and cell phone minutes and power and sustainable cooking fuel. We just added milk powder. We got fuel. We continue to add everything else that the world's poor need and can't afford that will have a critical and profound difference in the quality of their lives and the lives of their children. And so we're a store where everything is available to be purchased. That is one, one way inside of all of it is a blockchain.

Do you actually operate those stores or are they subbed out in some fashion?

I, I endeavor to be an exponential organization that's critically important for us. So we, we, we've created that ecosystem and we find beneficiaries that benefit from it and we let them operate it.

Okay.

We have ground staff and, and management in country that oversee the effective execution of the organization.

Got it.

But the stores themselves know, and then you know, to move that model forward with a simple scale and a smartphone, anyone can now accept social plastic by weight as a form of payment. So even if you're a small vegetable seller on the side of the road of Mozambique, you have the power now to accept social plastic as cash. Hmm. Now that plastic, as we collect it, we add value in country and then we export it or use it in countries, the raw material and we sell it to companies like Mark and Spencer's and Henkel and Shell Energy and a long list of others that use that as an input into their manufacturing so they can as well connect with their customers exhibiting authentically that they stand for a plastic free ocean.

Now when you, when you're selling the plastic material off in, in that environment, then you're selling it as, as a post consumer like pro environment type plastic, social plastic.

We sell it as social plastic. Yeah, it's our own category.

So it has a greater value maybe than other plastics, other, other stock that they could use.

Yeah, it's material that's transformed the world. Yeah, it's material that has been collected from ocean bound waterways and alleviated poverty. It's a material whose value is transferred through the lives of the people who encounter it, rich and poor. Even the people who buy the material. Even if you go and buy a shampoo bottle that has our plastic inside of it, that that value also transfers through your life because you are now a cause in the matter. You are now a cause in the solution.

Absolutely. So if you're, if, if I'm running a business, I'm using plastic in some form and I source some of that plastic from you, then I then I bring values to bear on my thing. Like. Like, well, another sector. Like, like some kind of social affair. Trade.

Sure, absolutely.

Metals or any other kind of thing like that.

Right, Correct. Yes. Senior VP of Henkel. Senior vp. She's been in fast moving consumer goods her entire life. Actually came through fashion. And after witnessing and experiencing the opening of centers which we branded and named for them, was able to turn to me with a tear in her eye, looked at me and said, david, it's the first time in my life that I don't feel like I'm selling shampoo. She saw that she was now on a purpose.

It's really, really cool because I think that a lot of times we're like, oh, I buy and sell something. When we stop and think about the purpose and the value and the greater impact on the world, it changes our sort of everyday economic activity changes into cause, purpose, values and fulfillment. We can feel good about what we do. We see its connection to the broader perspective. Right?

Yeah. You live a purposeful, joyous life today. I mean, the previous conversation to this was that people are living in the postponement of purpose. They think that at one point they'll have, that they start a business thinking that once I have the cash, then I'll be able to have purpose. Once I have the cash, then I'll have to enjoy. No, this is an opportunity to be joyous today. And in that joy lies abundance. And with abundance comes even more cash and more of everything else that you want in life. And when you live in abundance, you're creating abundance for the planet, you're creating abundance for the. Of course, more comes to you.

So the initial expression of purpose and value is the point of the business. I think you said that you created that all in a matter of a few minutes. Do you remember what that is? Has it changed since that?

No, it hasn't changed at all. It's been the same the whole time and just as powerful and just as amazing. And it was revealed in a moment and certainly be succinct. And certainly the purpose is to prohibit the flow of plastic from entering the ocean. And the mission there is to monetize waste. So we monetize it. Creating an economy from those material resources and, and the values of the organization, certainly the number one is to gather together. Right. There's a double entendre there. But the value, the core value of the company is to gather the world together, to gather the material together. We can't go and collect it. And the same reason why we don't own the center, we gather people together who can then gather others together. Or even like our relationship with Henkel, we gather them together and then gather their consumers together. And when they gather together, then the material is collected. So our whole focus, the entire organization, is about being a conduit for change, about monetizing waste. The mission is to monetize it, not to go and collect the material working on what's important. Once we've created the monetization of that, the rest in the collection kind of takes care of itself.

Yeah, because people are looking to discover value, especially the poorest people.

Of course, they're the most resourceful. They have to be resourceful or they die. And now what we do is we actually give them an entrepreneurial experience. And more importantly, we give them an unlimited income opportunity. Unlimited. I mean, there's only a few in the world that have unlimited. You can own your own business, which is what this is. You could be in sales. You have no cap to how much you can make. Right. And this is what we do. We give them an opportunity and the training we give them is how to build a route, how to collect volumes of material, how to go to hotels, how to do those things to create volumes they don't have to work every day. Working through the ditch. Unlimited income opportunity. Wow, does that spark a paradigm.

So do you actually operate any collection, distribution, processing anywhere? What does that look like?

We certainly. We partner with existing infrastructure. We want to enliven the entire world. I don't want to own any of it. That's not exponential. It'd be ridiculous. I don't own any recycling facilities. That's not the idea. We work with our partners on the ground and we give them more value. And because we sell our own category of material. Yes, it pays more than the commodity. And because when we sell our material, we sell it at a fixed cost. And so we're not at the whim of the fluctuating commodity price of the recycled feedstock or virgin feedstock them. So we give fixed price. And so people can be reliant. And that is most important in the eyes of the poor. Imagine being the abject illiterate. Abject illiterate. You can't sign your name. You sign an X maybe, and you return material one day and they'll just use the numbers and they give you a dollar for the work that you did for the day. Next day you come back, you don't know what a commodity is. You're the abject illiterate. You come back the next day. You've worked just as hard and they give you 75 cents and you go, what's going on? They go, that's how much it is today. How, how further diminished do you feel? How much more hopeless are you in that situation?

Well, in the concept. Look, if you're, if your literacy is that low, the concept that something changes in value that dramatically is hard to wrap your head around.

You can't tell commodity oil that plastic is oil, that it's beyond the realm of comprehension. And so consistency, price consistency and price buoyancy for the poor. Critically important. It has to be at a point, the price has to be at a point that they see it as money. That's really so simple. So simple. The difference between the ocean continuing to be polluted and being clean is about 10 cents.

So the idea to understand, to point back to exponential organizations and is the book by Saleem Ismail. Yeah.

Awesome book.

Salim Ismail. And the idea here is tapping into the combination of leveraging systems and technology and that kind of thing to deal with problems on a global scale in a unique way. Think how Airbnb is the largest lodging company in the world today but owns no properties. Or Uber might be the largest transportation company but owns no cars. That idea. And you could have all sorts of judgments about it. But could you operate about those particular business? Could you operate your business, take advantage of those ideas to achieve a truly extraordinary global type scale to solve a problem on a world level? And I think that's so much of what you're speaking today. You start with the end in mind and you go thinking about where you want to be. You articulate the values, the purpose, the mission of the company. And then you start to structure something that scales easily and effortlessly across something that changes the whole equation. Right?

Correct. Yep, that's it. We're going to be the world's largest recycling company, period.

Super cool.

And ultimately, we're world's largest material handling company.

Yeah.

The platforms we built it out isn't just for plastic. It's for abandon cars if you want whatever you want.

So outstanding. Now, funny follow up question. This is the 10th anniversary of my dad's passing today, as it happens. And he was a sailor who taught me to love to sail and to surf and to enjoy the ocean also. So we share that in comment. And I just wanted to ask about your dad's heart attack and how that.

Well, let us be a celebration to the, the joy and gift that he gave you. The ocean. Yeah. And let's, let's carry him forward with Us. So very nice. Thank you for sharing. And yeah, my. My father was. My father was. Was a, you know, a merchant marine. And. And certainly his passion was in the ocean as well. And you got to be somewhat of a, you know, I mean, he built this boat by himself, hull up, all the mechanical, all the rigging, all, all the electrical, all of the woodwork, all of everything in the boat. And, you know, spent years building that on his own. I think perhaps more of an escape from my mother. I think he was really building his escape pod. I think it was, you know, and suffered from. He was bipolar and just manic and, you know, really prescription drug addicted and all those things. And the family suffered in that. I mean, he felt value in his suffering, and it was substantive to him. His suffering was substantiated when it was in the eyes of the family. And so we suffered in that and the stress and everything else that came from that and the alcoholism and the business itself and the violence that would occur in those businesses. And I think my mother was ultimately trying to poison him by feeding him steak every night. And I think in the end it was a slow, slow, progressive poisoning, arterial poisoning. No, he did survive that. I took command of that boat and I sailed this. It took us four hours, four hours to sail back to shore. And just as I got to shore and the radio was down below, so I'd have to go from helm to radio to helm while he's dying. And at least I was preceding his death. And they sent a helicopter out of San Francisco. It took them four hours appointments, and they sent a cutter as well from a place called Fort Bragg. And I also learned humanity there. I learned community. I learned, you know, loving expression. I learned so much from the people who came to my aid, and I learned so much from the people who came dockside to my aid as a 15 year old and the entire community that mobilized to bring me food and gift and friendship while he was in the hospital there and everything else. It was a tremendous gift as everything in life, as everything in life is. And I have got to become who I am today. From every shitty experience and every. Every, you know, near bankruptcy, every employee that wanted to compete against me, everyone that tried to steal from me. I am where I am today in this gift for the world as a. As. Just as the gift that all of those people gave me. I got to be in that. I got to become that person.

Well, I'm reminded from your remarks that I think it's an Einstein quote. He said, there's really at least a couple ways of looking at the world. One is as if nothing is a miracle, and then the other is as if everything is a miracle. And from that experience you build your boat, you build your business, you take all of that, all of it, and you treat it as an experience to build from. And I think it's just beautiful. And I love the work you're doing and I love I want to tell our folks that if you'd like to learn more about David and the Plastic bank, go to plasticbank.org just like it sounds plasticbank.org, we'll put the link in the show notes as well and you can read more about what they do and how to take advantage of or partner like that with them. And as always, if you want to learn how to build a business that scales massively, rooted in purpose and values, with great execution habits and all of that, you can find lots of free tools and tips and blog things and a podcast like this every week@scalingupbusiness.com so go there and find all the stuff we've got for you for free and we'll send something out to you every week. Thanks again so much for being on the show with us, David.

Yeah, pleasure Bill. Thank you for having me.

Well, I hope you enjoyed the show with David Katz as much as I did. Of course you can find our information@scalingupbusiness.com and plasticbank.org for David Katz and his organization. I want to give special thanks to our original growth guru Vern Harnish and acknowledge our show producer, Nio Bade. Audio production is done by Podfly Productions with audio editing by Albert Burge. Our show notes are compiled by Andrew Codena and proofreading is done by Tim McGowan. If you got some value out of today's show, then please share it with somebody else and let us know what parts you love. Thanks again for listening and keep scaling up. Are you ready to turn your goals into daily wins? You should check out our scoreboard software. Powered by Align, it's the official software for scaling up. With Scoreboard, you'll get an AI driven coach for priorities and KPIs and it'll help keep your team focused on what matters most. With Align, you can track your goals in real time and and you'll even see results on the go. With their mobile app you can rest easy knowing that Align has world class onboarding and support to set your team up for success. This is really more than just software, it's what I actually use to manage growth in our scaling up client teams unlock clarity and results with scoreboard by align. To try it now go to aligntoday.com billg One more time. Align today combilg that's aligntoday.com bill g Check it out and try it now.