How To INVEST In Your 30's To Be WEALTHY In Your 40's | Lewis Howes

Get your savings right and the reasons I say don't buy the thing that was hot and then know how to diversify well. Those would be the most important.

Above all, taking 10% of whatever anybody gives you, your grandmother, your birthday gift, whatever it is, and set it aside and start investing it.

I just want to encourage everybody, whether you're making 250K or 2.5 million for the high earners here, don't get too smart for your own good. Keep investing and saving.

This video is brought to you by Wealthfront and I'll tell you more about them in just a minute. [Noise] what have you found are the top places that people should be investing?

Well, I think first you start with what are the most important things that you're closest to, like is it your business? First, calculate how many days, weeks, months, or years you can live on your saving. Because when you do that, you'll start to, you'll gain security, you'll gain that, okay? So look at how much you're spending, okay, and then say, how much do I need? And whatever that number is, you're gonna need more than that, because it may go down rather than go up. So, okay, now do I have a year's spending? Okay, so I think you start there. Then you start to think, what are the things that are most important for me? And then you start with your business or your residents that have a symbiotic relationship and that you know well. Let's say if you'd start with your business, Okay, you're closer to that, investing in yourself with whatever that may end up being, that may be your best investment.

Not real estate, not stocks, not the market.

Well, it depends if you're not, you know, if you're doing something where you can do it yourself and that's the thing. But if you're in a job and that's not the thing.

Right.

Because you're in a different position. Okay, but anyway, if you, and then I really think there's something good about your home, a basic thing about your home because it's nice forced savings and it also means that you fix it up, you're saving, you find out there's, oh, well, if I add this thing or that thing and you're enjoying it. So when you're enjoying it and you're controlling it and it's yours and so on, that's pretty good. And if they keep mortgage tax deductions and so on, there might be some benefits to it also, okay? But that's not a black and white answer. You could take a short pencil and say, is it better to rent or buy? Okay, that's a different question. Maybe yes, it, but by and large, Am I going to move? You know, all of those other questions. But, so when you start with, okay, what is it that's close to home and how much? You need a certain amount that's liquid. In other words, you got it in your house, you got to make a mortgage payment or something, and all of a sudden you're, you know, it's not liquid and you lose your job, well, that can cause you trouble. So how much do I have that's liquid? How much do I have that's not liquid? Okay. And you start to get those things right. Okay. Ah, I've got enough liquid. I got enough, okay, not liquid and those other things. Okay. Pretty soon you're getting yourself in good shape.

Yeah.

You do those things, you know, you're pretty much in good shape. And then you're also having some experiences. And then you go beyond that. you know? And then, so you start to, okay, what's a stock? What's a bond? And then, you know, you learn through experiences. I learned through my experiences. I started when I was a kid, 12, I used to caddy, and I took my caddying money and I put it in the stock market. And I was lucky. What happened to me, by the way, is I took my caddying money, and I bought the only company that I ever heard of that was selling for less than $5 a share. And I thought that that, you know, well, I was really dumb. I thought I'll buy more shares. So if it goes up, I'll make more money. And it was the only company. It was a company that was about to go broke, but somebody, some other company acquired it and it tripled. And I thought, oh, this is an easy game. and I like it, easy money. So, but you know, you experiment and you learn.

You're a very philanthropic individual. You and your wife, your foundation, your company, you give back in a lot of ways. Some might be through donations, like computers, some might be through financial, some might be through just your work and your content on LinkedIn, which is amazing. I recommend everyone subscribe to on LinkedIn. The content there is amazing. You're giving back in lots of ways. I'm curious, what's the greatest gift A rich person or someone with money can give someone who doesn't have money.

To give the knowledge, teach a man how to fish is better than to give him a fish. I mean, I think you can give them both. You can give education and you can show, but ability, the capacity to be productive because, you know, if I can give you the capacity to go out in the world, it's like go into a jungle, I give you a knife and can you live in the jungle? Okay, if I give you that capacity, that's the best thing I can give you. That's why I wrote the book and pass it on. I wrote those principles over years and I wrote them down and that's what I want to pass along. That's the most important thing. But if you've got money, you can help people a lot in a lot of different ways, which is thrilling.

What would you say then are the three greatest skills that people that aren't financially abundant or that are struggling financially should learn to master in order to be in a better position financially. Three skills, what would you say they should learn?

Well, as I said before, I remember watching the movie, I was young, David Copperfield with WC Fields, and he speaks to David Copperfield, and he says, he said something like, and I'll put it in dollar terms, you earn $100, and you spend $105, that's misery. If you earn $100 and you spend $95, you'll have a good life. I mean, it wasn't exactly like that, but it was, but basically, I know so many people who don't earn much, but are there. Because if you start to think about what it is that it costs you to live in terms of, let's say, the basics. Give me a bed to sleep in, give me the food, let me be educated, and so on and so forth. I think most people can get themselves in a position where they're net positive. So if you can be net positive and you could do that, that's, number.

One.

As I carry that. So that's number one. Then I guess it was the list that we went to. The second is, what do you do next in terms of what do you need, what do you invest in, and then going beyond it. And then avoid the following mistake, the most common mistake of investing, thinking that the investment that did good is a good investment. People rather more expensive. The things that quite often, those markets that did really, really well became more expensive and everybody, smart money, is all the time comparing them and competing. So what happens is the naive money buys the thing that was hot or is hot. The thing that has been terrible, which might be the thing that's beaten down. So I would say also an important element. Okay, so here's another one that's really important. Diversify.

So don't put all your eggs in one basket.

Right, because what I learned about this, is that first of all, all investments compete. It's not easy to tell whether one investment is better than the other, because if people could do that, life would be easy and everybody would make a ton of money. This is a competitive game that's very difficult to compete in. It's very difficult to say which one's better or worse. You could take experts and do all sorts of tests, and you'll find out that they can pick that and you can't tell whether the worst ones are going to be better. Because of that, you understand that even picking the best ones is difficult, and particularly if you're naive, like we spend hundreds of millions of dollars each year on research to try to give us an edge.

Okay?

Now you've gotta compete with us. So competing in the markets is more difficult than competing in the Olympics. You wouldn't go think I'm going to compete in the Olympics. But there are more people who try harder in order to do that. So it's a zero-sum game. But diversification that they're different will reduce your risk without reducing your return. So if you know how to diversify well. So that's critical. So I would say again, Get your savings right and the reasons I say, I would say have great humility about what you don't know. Don't buy the thing that was hot, just 'cause you think it's hot. And then know how to diversify well. Those would be the most important things I could convey.

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Teach it in high school. Luckily here in Florida, it's been put into the curriculum and I'm very proud of that. You know, I used to be in the educational software business. There's 110,000 school buildings in America, majority of them in New York. in Florida, Texas and California and abysmally most of them don't teach even debt. They don't even teach how to use a credit card which is ridiculous. We've got to change that and luckily we are. We're starting to see it creep into the curriculums in all the major states which is good. But I think parents have a responsibility to talk about money which is always sitting at the table every day. It always is. And getting their kids to understand how a credit card works is very important. And again I talked about not entitling, that's important too. Within your friends, I mean, don't be embarrassed to talk about money. You're going to be talking about money for the rest of your life. It's always going to be part. You can't live without it. You have to deal with it. It can cause great joy and give you personal freedom or it can be catastrophic in your life, destroy your happiness completely. Your choice is where does it fit? Do you want it to destroy your life or would you prefer that you understand how it works and respect it for what it is and deal with it. That's a personal choice people have to make. And I would say the best way to do that is learn more, talk more about it, and don't be afraid to discuss it. I don't care what age you're at, but certainly at the age of 16, you should be discussing that. And above all, taking 10% of whatever anybody gives you, your grandmother, your birthday gift, whatever it is, and set it aside and start investing it. The earlier you start, the less pressure.

You have when you're in your 60s. And do you think someone in their late 40s and 50s, do you think it's too late for them to start learning about financial literacy if they've struggled in their 20s and 30s and 40s? Do you think it's too late to start investing and saving? What should people do in their 40s and early 50s?

No, they should at any age. I mean, the truth is, changing your spending behavior in your 40s is difficult, but you can do it. And at that age, you should start saving 20 to 25% of what you're taking in, which sounds hard to do, but it isn't. You just stop buying those $5 coffees and you stop buying stuff you don't use. Anybody can go look in their closet see all the crap they bought that they never used. And basically you killed that money when you did that. You bought something that you could have had invested and it could have grown 6% to 8% a year for you, but instead you bought some piece of junk that you're throwing out now. Everybody's guilty of that. I actually think my mother was right. She's always said that people can save 20%. They just don't have the backbone to do it. And she did. And she died a very wealthy woman. She had a secret account she kept from both of her husbands. and I was the older brother and was executor for the state and I remember the lawyers calling me up saying, you got to come down here. Your mother had a lot of money and I always wondered how she did it. She basically bought dividend paying stocks in her 20s and a whole bunch of telco bonds, 50-50 portfolio. She loved telco bonds. They used to yield 6% in those days and she loved dividend paying stocks, S&P stocks. And over the 50 years that she had this account, it just provided massive Appreciation.

Should people die wealthy or should they die broke because they spent their wealth on charity or giving back or whatever, living their life and going on trips and adventures? What's your philosophy there?

You know, the trouble these days is you don't know when you're going to die. You make certain assumptions and then you live an extra 10 years or 20 years and you live at a time in your life when you really needed that money for your comfort. It's probably better to not make an assumption, oh, I think I'm gonna die when I'm 88, because you don't know what technology is gonna provide or what your genes really have in store for you. I would prefer to die with a good chunk of dough in the bank and then gift it to a cat.

A cat? Yeah.

You know, cats only last 14 years. We break 14 years for them. I'm just kidding. I probably give it to a combination.

Of.

In my case, I feel safe because I can roll it into a trust that doesn't provide for you after you finish college. So I don't feel I'm entitling anybody or cursing anybody's future. So I'll just probably roll it into one of my family trusts and say, I don't need it anymore. The only thing I'm taking with me to the afterlife is my watch collection, all of them. I'm going to eternity, I got a lot. I don't even say anymore how many I've got. I haven't, you know, really, I'm very proud of my watch collection and it's a incredibly, it's got some amazing pieces and it's taken me years to build this collection and I'm going to need it to tell time in eternity, so I'm taking it all with me.

What do you think is the best investment you've ever made in yourself?

Well, the best investment I ever made in myself was myself. You know, you often doubt yourself, but you know, it was, you know, I went through some very tough times right from when my mother cut me off through several business ventures I failed in and then you just don't know, serendipity knocks on the door. The thing is, as an entrepreneur, you just got to keep getting up every day. You have to stay in the game, you have to stay in the race. It's very, very hard. It's like that story of the guy with his fiance, you know, you just have to focus and you have to find somebody that's willing to focus with you but I'm glad I did what I did. I wouldn't change a thing. I've made plenty of mistakes, but it is who I am today and I'm very proud to be able to offer the things I do to my family and to support different initiatives and charities and support the arts and collect watches and guitars and cook and all these things are made available because I've been able to focus on being successful in business. And that is the great American dream. It's going to remain that way forever. The essence of why Shark Tank works, I'm very proud to be part of the platform. I can guarantee you 13 years ago when we started this thing we had no idea what was going to happen. I mean it's just who knew. But now 9-year-old girls to 99-year-old men come up to me saying look let's talk about that deal last week on Shark Tank. and I'm happy to do it. I mean, I think it's a wonderful outcome and we're proud of it and as we start to work on season 13, I mean, it's, you know, no television show lasts 13 years, practically none.

Less than 5% of them.

It's amazing. So it's great and we're proud to do it and I don't know, that's the whole idea that I encourage people, don't pursue entrepreneurship out of greed of money, you will fail for sure. Because every time I talk to anybody that's had a big liquidity event, I say, Did you see it coming? And how did it happen? They said, We never saw it coming. We were just working one day and then boom, I was poor, now I'm rich. That's always the way it is. It's not that you're saying you're counting your dollars. You don't have any until one day, boom, something happens. And then the funny thing is you find yourself right back to work.

I love that. And I'm curious, do you think the middle class is financially stuck? And if so, what can they do to start achieving more financial freedom?

No, they're not stuck. And one thing that's democratized, and we learned it since this whole pandemic started, you can create a new opportunity for yourself online with virtually no barrier to entry. Many, many people did it as a side hustle, and it's now producing more income than their first job. The whole idea of trying to solve for customer acquisition, using creativity, using video, using music, using photography, using storytelling, animatics, graphics, to actually sell a service or product, starting locally and then expanding. There's millions of new businesses that have been started during the pandemic. We see them every day on Shark Tank, but they are basically taking middle class people out of middle class. They're, and I'd say if you look at Shark Tank, we have plenty of people that have been working in the middle class for years and all of a sudden exploded to the upside with a great service or idea that they did online. And that's why I really think people should empower themselves. You can try things online, you can see what works, you don't have to get the first one right. But those tools are there for you. Yeah. And most of this is done on Facebook. in geo-locked advertising, 80 cents on the dollar of what my company spend is on Facebook. So I always find it very funny to see people bashing Facebook saying how evil it is when really it's running small business in America because they have that unique geo-locking advertising feature. So we shouldn't shut it down until we find something better.

Yeah. And what would you say are a couple of qualities that you really look for when you're when you're looking to invest in someone or when someone has an idea and you see whether you invest them or not, you're like, this person is going to be successful, whether it's in this thing or something else. What are those two or three qualities that all of them seem to have in your mind, whether it be a leadership skill or clarity, what would that be?

I prefer to invest in entrepreneurs that have failed once or twice before, that have felt the sting of failure and have gone down the road and not had success the first time because their motivations are completely different than a more arrogant first timer that thinks everything they do is going to make $100 million. It just doesn't work that way. And so that's one thing. I love there's three things you have to have the ability to do and know if you're going to be successful in business. Number one is you have to be able to articulate your idea in 90 seconds or less, explaining to me why anybody would want that product or service. And if you take more than a minute and a half, you're never going to be successful. You're just not. And number two is you have to be able to explain why you're the right person to execute on that idea. In other words, what is it about you that knows how to take this idea, which good ideas are dime a dozen, executional skills are really hard to find. So what is it about you that can execute on this business? and make it work. I mean, those two together start to be really interesting because then as an investor looks at it says, well, I'm going to mitigate my risk. I got a great executional, you know, expert here and I've got a great idea. And then lastly, the one that I think you have to have a good command of, you have to know your numbers. You have to be able to explain gross margins, market share, break even analysis, how many competitors, how fast can you grow? Those are the three things that define success. And I think that's who I want to invest in, someone who has the command of all three of those. That's probably got more than a 50% chance of being successful if they can do that right.

And how does someone develop a rich mindset if they've always been told that people with money are bad or money makes you evil or whatever people have heard when they were growing up? How does someone shift out of that and start seeing money in a different light, in a positive light, in a powerful light in their benefit, and in an abundance mindset as well. How do we shift that if we've always been conditioned otherwise?

Yeah, but you have to understand why a third of the population seeks entrepreneurship. It's not out of the greed of money, it's the pursuit of personal freedom. In America, what sets you free is to have enough financial resources to spend your day doing things that you want to do. it's one of the greatest freedoms you can have. And what I learned about it, you know, when I had my first liquidity event, I was young and we sold the learning company for $4.2 billion. There were 10 of us who were founders. So what I found so amazing is everybody showed up the next day after we closed right back at their desks because they didn't know anything else. That's what they wanted to do. They wanted to work. And what I found in life is I work harder today than I ever have. and I don't need to, but I still want to and this is what I know. And so the whole idea that I don't have to do something, you know, I work with Nancy Chong who sort of manages my day and I block it off into 30-minute things and each week, you know, maybe on Saturday morning or something we review the next week and I look at all the things that are in book and if I see something I don't want to do, I just say, Take it off, I'm not doing it. And there's nothing anybody can do about that. That is my ability to be free to choose the things that mean something to me and avoid the ones that don't because my most valuable asset at this point is my time. That's what I care about and I wish that for everybody. That's my whole point. But something about money you should understand and everybody should think about is the danger of money in a family. is entitlement. If you entitle somebody and you de-risk their future, you have actually cursed them. You've cursed them. You have almost guaranteed that they will fail, that they will never launch. I experienced this myself when I was graduating from college, undergrad, and my mother came to that. Again, she was a big influence in my life from events like this, and she said to me, Great news is I'm coming to the graduation, but I I want you to know the dead bird under the nest never learned how to fly. And I said, Mom, what the hell does that mean? She said, There's no more checks. I've paid from birth to last day of college. That's my deal, and you get nothing else from me. And I went, Wow, like I don't have a job. I can't even pay my rent. And like, she said, you,'re gonna have to work it out. I mean, look, I've done my job, and now you're gonna have to learn how to fly. And I had a tough couple of years, but what she was really saying was, she hated entitlement. And she didn't want to entitle me, and I had to go figure it out. It was very tough. And years later, you know, I always look at these things that you, these moments you learn something and then you apply them later because they've, you know, they've steeped, they've aged in your head. They've actually come, you know, it's like a wine. It's aged to a perfect flavor. And now you have to use it because it's been something so when I had that big liquidity event, my kids were four and six and I went across the river, we were in Cambridge, I went to Boston and I set up generational skipping trusts that did exactly that. They took from any child from birth to last day of college at any degree, they could go right to a PhD if they wanted, they could stay in school their whole lives if they wanted and that the trust would pay for them long after I'm gone. But after they graduate, Nothing. Zero. And I said that to my kids, and they were four and six, they just laughed at me. And then later in Boston when my son was in high school doing really poorly, not applying himself, one day I guess he had talked to one of his friends in his class, was telling him all about his family trust and all that stuff. I don't know why he brought this up, but my bet is that's what happened. He said to me, Dad, walk me through the trust that my trust, I said, Sure. Mom and I going out to dinner, if we get run over by a bus, you don't have to worry. You're gonna get to finish high school, but it doesn't look like you're gonna get to college 'cause your marks are terrible. And then he said, well, okay, then what happens? I said, well, I'm dead and you have no money. And that was the first wake-up call. Yeah, well, that was the wake-up call. And it may sound cruel and people may say, Terrible. Today he has started his first week as a full-time engineer at Tesla after, you know, going through the whole system and graduating as an engineer. I paid for the whole thing. But now he's on his own. And, but I think the wake-up call motivated him. That's the whole idea of entitlement. If he thought he didn't have to do anything, maybe he wouldn't have taken that path. How many rich kids, screwed up rich kids, do you know? Plenty. There's lots of them. They're entitled. Mine will never be. And they may not like me for doing what I did to them, but if they have children, the trust pays for them, and those are expensive, and I'll be gone. But that's my whole point.

Wow. And I know you know a lot of wealthy individuals who've had big exits, billionaires, you know, all these different things. What advice do you give them, or what would you give them? Maybe they wouldn't ask you for the advice, but what would you give them on how to raise better kids who have all the money in the world to their disposal?

Don't give it to them. Don't let them think that they are de-risked. Don't let them think they're entitled. They will act differently. They will take a different path. They will focus on their own lives and try and achieve things on their own. There's no reason you can't support them and you can't help with them emergencies like medical emergencies or whatever it is. But if you entitle them that they never have to work, you've cursed them. You've totally written them off in terms of people that could have achieved greatness because they were motivated to do so for reasons that everybody in the world has. You have to find your own path. That's the whole idea. If you're granted a free pass, you've wasted a whole lifetime. That's my view. Look, not everybody agrees, but look, this is the way we run our family and so far so good. And you know, the one thing that I think we failed as a society on, 'cause you're getting into an area that I spend a lot of time on here, is financial literacy. We have failed an entire generation. There's a hundred million people in America that have, and some of them are in their 60s, that have nothing set aside for their retirement. They never were taught how to invest. There's a big difference between saving and investing. A savings account gives you nothing now. Interest rates are basically zero. The markets give you six to eight percent a year, but you've got to learn how to harness them. Nobody teaches those kids anything. And that's like, it's a good segue into something I want to talk to you about called Bean Stocks, which is, you know, a big initiative for me to build a robo that invests like I do and like my mother did, a really conservative robo that you can download and and actually tries to help you do this without you understanding how to buy and sell stocks. So let's talk about that for a minute.

Yeah, what is it? How do we get it?

So you download it off any phone, on any app store, and the whole idea, here's what I learned. The first time I took a stab at this, I assumed that everybody knew how to buy a stock and sell it and how to build a diverse portfolio. I was 100% wrong. I brought out an incredibly sophisticated product, but 99% of people don't actually invest directly themselves. Some massive percentage of the population don't do that. They either have an advisor or they don't have an advisor because they don't have a lot of money and so we ignore them. If somebody only has $400 to put aside a month, generally the financial services industry ignores them because they can't make any money off them and that's 100 million people. So I helped the whole team developed bean stocks and there's a zillion different Robos on the market and I think anything that helps you invest is great. But I couldn't find anything that invested with my personal philosophy. And so, you know, I really wanted something that was about value, about getting paid dividends, so get paid to wait, conservative in nature and above all diverse. And so I like to use exchange traded funds. I use that in my own family trust and that's what we built Bean Stocks around. So the whole idea is that you put aside $100 a week, and if you're in your early 20s and you do this, you find the discipline. It's about $100 aside a week. And that's the hardest part, by the way, because there's always some piece of crap you want to buy that you don't need. But you put it into Bean Stocks and it automatically diversifies it into a portfolio designed specifically for you when you set it up. And so you can put projects that you want to maybe you want to buy a car or a house that helps you do that. It helps you just diversify into a wide range of ETFs and just it's a place where you build a nest egg. That's the whole idea. Now it doesn't mean you can't day trade. You can have a Robinhood account. You can do whatever you like. You can do an online broker, whatever. But this is for the part that you're putting aside for yourself for the future when you turn 65. which might be 10% of your paycheck or 10% of your winnings and if you're a day trader. But it's completely different. It's not day trading. It's investing.

What I do with my financial system is I set a target each year. This is how much money I'm going to save and invest. And those numbers are aggressive. There's... That's a lot of money.

-You'Re going hard.

-Yeah.

Like every year. -10%, 30%. -Yeah.

So, anywhere between those those ranges. And we have folks who-- Of which you earn. Correct. And then remember, whenever I make any unexpected income, let's say I did a speaking gig or something. Yeah, I might get myself some-- I might go out to dinner, but the rest I'm just putting straight in investments.

Wow.

Okay, so that money grows aggressively. And I also want to remind everybody, especially the entrepreneurs watching, I know you have a lot of entrepreneurs.

You wouldn't believe how many entrepreneur friends.

I know who have a good business and they don't invest at all. And that's a huge mistake.

What should we be investing in if.

You have a good business? Simple low-cost target date Funds is a great way to go.

Entrepreneurs. Index funds.

Yeah, index funds. They get a little too smart for their own good. They say, I could just put that money in my business. And I always say, Look, I'm glad you have a business that's throwing off tons of cash. That's awesome. Most businesses don't last 80 years. So be smart. Give yourself a small plan B. Put 5K a month, 10K a month, whatever is appropriate for your level of success. And hey, maybe your business does really well. That's awesome. But maybe one day something goes wrong. Always want to be prepared. You never want to have your back against the wall. So I just want to encourage everybody, whether you're making 250k or 2.5 million for the high earners here, don't get too smart for your own good. Keep investing and saving.

What are the three or four main things you invest in with that 10 to 30% a year? And does it change year to year?

Yeah.

I'll kind of walk you through for the high earners and then we can talk about people 100k and less. So once you have a certain amount of capital, you do have a few opportunities that you probably didn't have before. Everybody has this idea that, you know, the rich have all these crazy tax breaks and captive insurance and this and that. And I've looked into all that stuff, right?

I know about insurance companies and all these other things. Yeah.

Here's the truth. The truth is, some of it's a little sketchy, but, yeah, definitely. And I'll say my core values are that when it comes to things like taxes.

I love your principle on this.

I'm very conservative. I'm like, dude, only in this country could I have been this successful.

I love this mindset.

I'm happy to pay my taxes. It means that I had the opportunity to create something great. And if I pay an extra 5,000 or 30,000, it doesn't change my life at all. And I want to be able to give back to the society that enabled me to do what I do.

That's a powerful mindset. And it gets you away from, you still wanna optimize tax breaks that are out there, but it gets you away from trying to constantly look for some of the shortcuts or like schemes or something.

Yes, I've always found that the people, especially entrepreneurs who talk about tax breaks all the time, are typically the most unsuccessful ones. Two reasons. One, why are you talking about tax breaks instead of growing your business? And two, it's a very scarcity driven mindset. Ooh, I only have this much that I have to protect when really you can just grow the pie and your taxes are simply a proportion.

Just make more.

Just make more. Now, yes, you do want to optimize and take advantage of all legal tax breaks. So as you earn more, you do have more opportunities. You have not only your 401, you have all kinds of advanced IRA options, you have HSAs, you have a variety of things. But at a certain point, if you're making enough, you're gonna max all of those out.

So what do you do when you.

Max it all out? So then the next step is to simply create a taxable account. It's just a typical non-retirement account and you just continue to invest. So that's one and that's going to keep making you money over the long term. It's just you're not going to get those tax breaks from a 401k and IRA, et cetera. The other thing is as you accumulate more and more assets, you're going to start to notice a lot of different people are going to come with opportunities. Dude, I get text messages from these crazy start like, hey, I'm opening up a bar in Brooklyn. I'm like, I don't want your stupid bar. I'm not investing in that. burn my cash easier. But you're gonna want, as you start to accumulate a lot, you're gonna want to do. Have a little fun with your money when it comes to investing. So some people want to do crypto. I think a lot of these people are complete nut jobs. Great.

Look, you crypto. I put a little bit in there just to, like, have fun.

But I was like, thank goodness I didn't put more in there because everyone's losing their money. Exactly. And they're, you know, they're all. Okay, I don't even want to get into crypto because I'm gonna get a lot of angry emails. Hey, if you want to email me about your angry crypto opinions, just send it to trash@iwillteachyoutoberich.com, don't send it to me.

But you know what?

I like what you said. You took a little bit, you had some fun. Yeah, had some fun. Five to 10% once you've got all your other stuff automated, you've got your index funds, locked down, HSA, your different accounts. I don't have any problem. I think you should take five to 10% and you should have some fun with it. For me, I did angel investing and.

I basically learned that I suck.

My angel investing is not good. I haven't made any money. Yeah, my deal flow sucks, my choices Things were okay, some hit, most didn't. I basically just wrote that money off. But it was fun and it allowed.

Me to have an outlet. And you learned.

I learned to meet people and you, yeah.

Yeah.

So if you want to do crypto, if you want to invest in somebody's bar, you want to do angel investing, if you're qualified, et cetera, be my guest. But don't jump to that first. Get all your stuff automated. And at a certain point, the compounding is so insane, you will start to actually earn more from your Investments than you will from your income, even if.

You'Re making 500k a year from the index funds you're talking about, if you're investing in that. What if the market's going down or up? Should you even worry about that? Let's say you put a half a million in.

Yeah.

It went up 100,000 over a couple of years, but then it went back to the original investment.

Should you be like, oh my gosh.

I need to take this out. Do not do that. I'll give you a real example.

I put two years of my money into this and it's still the same amount. I should have just left in the bank. No, you shouldn't have left it in the bank. All right, so this happened to me just about two weeks ago. So the market went down and I hardly ever log in. I log in about once a month to my investments.

You see like, oh, yeah.

And really you should not be checking your investments.

Check every 10 years.

Once a month is good and like, don't, you're not a day trader. Okay, so I happened to log in and I saw that in the 11 days of that month, in one of my accounts, I had lost 75,000. $100,000. Okay, so for everybody listening, yeah. How would you react if you lost $75,000 in 11 days?

Most people would be freaked out.

They'd be freaked out. They would pull the money out. Yeah, which is exactly the opposite of what you should do. So everyone says this common thing and they just roll their eyes, oh, buy low, sell high. But in reality, they actually buy high and sell low. So you know what I did? I did nothing. I logged in. I felt no emotion. It wasn't like my life is over. It was like watching someone offer me concrete to eat. Like I felt nothing. I'm like, nah, it's fine, whatever.

I just closed the window.

The key there is every month my system is automatically investing. It's called dollar cost averaging. It's just automatically investing. And you should set the same thing up too. You shouldn't be paying attention manually. You shouldn't be sending a check. It just works automatically. And so I knew this month, the market is down. And if you think about any other thing you buy, if the price of toothpaste goes down, you're happy. If the price of milk goes down, you're happy. The only time we get weird is when the price of the market goes down and then we're like, oh, let me pull all my money out. Bad move. The price went down. If you're young and you have a long time before you need the money, you're getting the market at a discount.

You should get excited.

You should get excited. So I just said, Great, it went down fine, doesn't bother me, and I just closed the window and a few days later my system will just purchase it again. So it's up, it's down, it doesn't matter in the short term, but over the long term we know that the market tends to return about 7 to 8% over time. But it can go up, it can go down, and so you do not want to be paying attention in the short term.

Let's say you've got a half a million to a million dollars extra cash laying around. maxed out all your IRAs, you've got five to 10 grand a month going to your index funds, you've dabbled in the smaller investments and startups and you've done it all. Yeah. You've got a little bit in crypto, you've tried everything. What should you do with that extra million dollars a year?

Okay, great question. First off, this is like somebody saying to a fitness instructor, you know, I've done everything, what should I do next? And that, you know what that fitness instructor is gonna say? They're gonna say, when you say everything, what do you really mean? Like show me, are you doing foam rolling? Are you doing this? Are you all balanced? For the person who's doing this, I'm gonna give you your answer, but I'm gonna first say, are you sure? Have you planned out, so you know that 10 years from now you're gonna buy a house. Do you have a 20% down payment set aside? I do, and I have no plans to buy a house anytime soon, but.

I have 20% set aside.

For a house.

For that moment, yeah.

Yeah, for when, so I already plan for what I know is coming even though I have no interest in it today. What about the first year of your kid's life? Do you have that set aside? What about XYZ? Are you taking care of your parents when they get older? One thing that I really love to do is talk about relationships. So I love to invite my family once a year for a big, big vacation where we can all stay in a house and there's a, you know, like a chef and all this stuff and we can all be there and the kids can be playing. Is that something that's important to you? Cool.

Right?

So plan for that. Now, if you've done all that stuff, you got your six-month emergency fund, you've got your investments automated on autopilot, and you still have money left over, you're in an awesome position, and now you can do a couple of things. One, if you want to keep growing that money, you can simply invest it in a non-retirement taxable account, and that money will grow like crazy. If you're putting in 10, 20K a month, that money will turn into massive amounts. And if you guys don't believe me, just go search for compound interest calculator. Bankrate has a really good one. And plug in 20K a month for 10 years. And that's it. Just stop and watch what happens as time goes on.

What is that? 7-8%.

Yeah, at 7% returns and watch what happens. It becomes like a tsunami. You cannot stop it. So that's one. The other thing is if you want to invest in a little bit of fun stuff, if you're like, Hey, I want to take 10% of this and invest in like this crazy investment my buddy's starting a thing. Go ahead, just be prepared to write it off. Maybe it works, maybe not. And then from there, you should also remember a third thing, and nobody really talks about this. Maybe it's time to increase your quality of life. Maybe instead of staying in the middle back seat, it's time to upgrade to the exit row. Or business class. Business class. Or maybe it's time to eat at a different restaurant. Maybe it's time to really think about your money dial and say, Hey, I always claim that wellness is important and yet I'm still eating like the same old thing I used to eat 10 years ago. Maybe it's time to upgrade what I eat and where I work out and all that kind of stuff. My gear. You can do that. You've made it. You already won the basic game. So now you get to benefit from it.

What about real estate? It's a lot of people, you're there. I hear people that are all in on real estate investment or they're kind of like all in on the market.

Yeah, I think that real estate, so a lot of people are gonna hate me after I say this. I know you guys have all been told since you were like two years old, real estate is the best investment ever. And it turns out that's not really true. A couple of things that might surprise you. If you're buying one home.

If you're buying a house and living in it. If you're buying multiple units or buying.

Multiple homes and that's your business, it might be a better investment. Correct. Let me make the distinction. So most people in America are told that the American life, the American dream is graduate from college, get married, buy a house, white picket fence, 2.5 kids, and you made it. And I think we all just have to look at people who are a little bit older than us to realize that might not be our American dream. We might want to travel more. We might want to work remotely. I mean, here we are in the middle of a weekday chit-chatting and sharing it with millions of people. This is our dream. So I want to challenge people to really question what you've been taught. That's number one. Number two, most people who buy a house and live in it think that it is the best investment. But most people have never really...

It's like my piggy bank.

Yeah, they think that. They don't understand that when you spend money on a house, you've incurred tons of phantom costs. You have taxes, you have maintenance, you have all kinds of things that you don't count. And if you actually factor all those numbers in, real estate often In fact, many times is not a great investment at all. It's a place to live and you have these phrases like you're throwing money away on rent. It's not true. Your landlord's making a profit otherwise they wouldn't do it. That's not true. Your landlord can't charge you whatever they want. They can only charge you what the market will bear. So if you search my name in real estate, you'll see all the numbers played out. Now, on the other hand, if you are a real estate investor and you're disciplined, that's a different story and that can be effective. But mom and pop who are thinking that they bought their house in 1970 for $200,000 and now it's worth 600,000, they think they made 400,000. Actually not. If they had taken that money and put it in the market, they would probably have much, much more.

Really?

Yeah.

Wow. And less headache.

Way less headache.

Well, depending if they looked at their investment every week, maybe they'd be more stressed up the level that's going up and down.

Yeah.

Listen, I will buy a house one day. Okay? So I don't want anyone to think that I'm telling you never to buy a house. If you want to rent for the rest of your life, you absolutely can. Many people in New York, San Francisco, and other high cost of living cities, they rent. There's no shame in that. I rent by choice.

I could buy a place tomorrow, cash, and I choose to rent. Why do you choose to rent? After you've been here for 10 years, and you've been renting the whole time.

Yeah, on purpose. And how much is that?

Do you think over over a half a million dollars?

Oh, yeah, it's a lot of money. I well over I rent a nice place. Yeah, why do I do it?

Because could use that money in something else youe could have put it in.

I did I put it in the market and I made more and as.

You didn't put it into a home correct where it was a lot more.

Money up front It was more money up front. I use that money instead I put in the market But there's also other reasons too I couldn't get for the amount. I'm paying where I live if I were to I buy a place in the same building or it would be four times more expensive. So that's the first. Second is maintenance. I'm gonna give you an example. I woke up one day and the doorman was knocking on my door. It's like 8:30 in the morning on a Saturday. He's like, Sir, sir, do you mind if we come in and take a look at something? I said, okay. And we go into the living room and there's a pool of water just sitting there. In your apartment?

Yeah.

It had dripped down three levels. So I was like, oh my God. They're like, Sir, go back to sleep. We'll take care of it. That day they came, they repaired the floors, not just of mine, the ceilings for the next two levels down. That's probably likely to have costed them, let's just say 50K, maybe 100K, 'cause it's Manhattan and it's a weekend service.

Who knows?

That's not my fault. You didn't pay for it? No. And I said, Great, that's their problem. I'm going back to sleep, man. I got another hour of sleep here. So I want everyone, you don't have to believe me. You don't have to believe what someone else says. All you need to do run the numbers. That is my only suggestion to you. Go to a buy versus rent calculator. Make sure you plug in all the fees, not just the taxes, the realtor fee. If you get a bigger place, you're probably going to get more furniture for it.

The HOAs or the lawn maintenance or trash service or whatever it is.

The key thing, I think, whether it's a house or investments, my point to you guys is take your money seriously. Once you take your money seriously and you put some time in it, whether it's this book or wherever you want to get your information, you're going to be better off for it. You don't want to delegate this to somebody else. I want you to understand it. And once you understand it and you automate it, you make a few good choices in life, you never have to worry about lattes or appetizers again.

How'd you make the emotional shift when you started renting an expensive apartment and you're like, man, if I added all this up after a year, that's close to a down payment on a nice house in the Midwest or they can buy a whole house in the Midwest. You know what I mean?

Yeah.

How do you emotionally rationalize that where you're not frustrated like, oh, gosh, I.

Just spent 10 years.

Yeah. Throwing this money away. Because sometimes I feel that way. Sometimes like, man, I just spent a lot of money in these last few years.

Well, let me ask you this.

But I like the freedom and the flexibility of not having to incur all those other. Yeah.

What do you like to eat? You like strawberries? No.

Okay, what do you like to eat?

Good steak and veggies. Okay, steak. Once you, when you buy a steak and you eat it, do you feel.

Like you just threw your money away on that steak?

No, I enjoyed it. But where is it? I don't see it. Where's my investment? In fact, isn't it coming out in the toilet in a couple hours? It is, yeah. So what are we talking about here? You get value out of a steak just like you get value out of renting. Now, if you want to incidentally build equity, that's great. But remember, you can also lose equity. Right now in Manhattan, do you know rents are down? Yes. And so are prices of houses if you want to buy. They're going down every month. A lot of people like, oh my God, it's so expensive. Sometimes. But sometimes it goes down 5%, 10%. Some of these neighborhoods are down 15%. Yeah. So a lot of people don't realize. In fact, I did a survey of my readers. I said, Do you think it's possible for real estate to decrease? Over half of people said no. They had never even thought about it.

So I want to- 2008, 2009?

Memories are short. You would think they would remember, but they don't. I heard people, dude, they had three houses. They bought it, they were destroyed financially. Their credit was ruined. They had to give up these houses and their identity as an investor. And three years later, they're like, I think I want to buy another couple houses.

Wow.

It just goes to show, I'm not saying they're stupid. It's not that at all because a lot of people have gone through this. It's the idea that the propaganda to buy a house or to follow a prescribed set of rules for the American Dream is so powerful that even losing your own houses doesn't change people's perspective.

So how do you teach people to overcome the emotional rationalization of blowing their money on rent?

Okay, it's funny.

Besides that story you just told, which helps me.

I'll tell you what, I want to acknowledge that it's real because-- It's a fear that people live with. Yeah, and I'll give you an example. I call it the handshake effect. And it's when people would come over to my apartment and for the first time and they would say, Wow, this is an amazing view. And then they always say the same thing in New York. Do you own this place? And we're like shaking hands, right? It's like we just met.

How much you pay on this?

Yeah, how much you pay? It's classic New York. And I say, no, I rent. And it's that moment where if I had said I bought, they would be like this. Wow.

Pretty impressive.

Really cool.

Yeah.

And you kind of get this pride. And then I, and then when I don't say that, they get really confused because this is the I will teach you to be rich guy, but also he rents. And I thought renting is for people who can't afford it, but I, you know, they don't understand. And they give me this look, and I realized that. So many of us are looking for somebody to approve of us while we are shaking their hand, someone we don't even know. And so instead of getting your approval from somebody you just met 10 minutes ago or from your parents who probably are not the most sophisticated investors, if you're watching this show, you know, you talk about greatness and being great means choosing your own path. Sometimes you might choose to buy. I have no problem with that if you ran the numbers and you consciously decided side. Sometimes it means you don't. But if you want to live the life of greatness, you need to be comfortable making different choices than what other people expect.

Zing. I like it, man. You've got some controversial things that you do with money that other influencers or thought leaders do differently.

Totally.

For example, you said that there's two things that Everyone needs to be doing at a young age if you want to generate more wealth.

Completely.

Two things are investing in stocks and real estate, is that right?

Yeah, it's the two primary escalators to wealth.

Escalators, where you can grow your investment, your money can work for you as opposed to just sitting in a bank.

Completely. It's like the game of Monopoly. I was just literally explaining this to my kids yesterday. I said, you know, on the game of Monopoly, you go past go and you get a paycheck. And if you just go around the properties and you land on them, you pay rent. And you can't win the game of Monopoly unless you buy one green home, then two green homes and three green homes and four, then a hotel. You have to be an owner in the game of Monopoly. The ironic thing is that the game of Monopoly is a great lesson for.

All of us for life.

You have to own assets that make you money while you sleep, that grow while you sleep. the challenge for most of America is that this stuff is not taught in school. Like this little book, the Latte Factor, I wrote it as a parable to reach the 98% of people who will not normally read a financial book. You've got my other stack over here. But most people won't ever read a financial book, so I thought if I wrote it as a story, that you can read in less than 90 minutes, and I can teach you these life lessons, the importance of paying yourself first, why you don't need a budget. We'll talk about that a little bit. For instance, budgeting, everybody says you need a budget, and budgets totally don't work. People hate them.

They hate them.

They hate them. It's like dieting, right? Like you try to go on a budget and you're married, you will fight about those budgets. People go on them, it's totally frustrating. So do you believe in budgets or no? I don't.

No.

What I believe is you need to have a system that doesn't require discipline, does not take time. See, this is the part that's different. The secret to everything I've taught, like you've got my other book here, the Automatic Millionaire, is that the real secret to building wealth, The ordinary people in this country have built real wealth is automation. They're saving money automatically.

They're not thinking about it. They're not thinking about it.

They're not stressing about it. They're not stressing about it.

They're not writing checks. They're not putting cash in little buckets and envelopes.

Envelopes.

And carrying these envelopes in a thing and being like, okay, I've only got a little bit left. And, you know, that's what, look, my grandmother, when she started at 30, she had nothing. And she used to literally save 50 cents a week. and put it in a coffee can. And at the end of the year, she took that coffee can down to a brokerage firm and started investing in stocks. That's what changed the entire destiny of my family. Wow. Was that my grandmother at 30 with no college education, working at Gimbel's department store in Milwaukee, Wisconsin, got tired of being poor. There's some people watching today that are there, right? They're listening. They're watching this or they're listening to this, and they're tired of being poor. My grandmother she was frustrated. And she came home and said to my grandfather on her 30th birthday, Jack, this is not working. Like, and when you're the guy and you hear that, you're like, what do you mean this isn't working? And my grandfather said, what's not working? And she said, we're broke. We don't have any money. And, you know, to my grandmother's credit, she decided to do something about it. And so she literally brown bagged her lunch every day. She brown bagged her lunch so she could save that money and go.

Best.

And the way the story turns out Louis is my grandmother, my first book Smart Women Finish Rich was dedicated to her. She didn't become rich overnight. She built wealth over her lifetime. I always say it's decades not days. People who try to get rich quick stay broke long.

It's true.

Like show me those banner ads on how to get rich quick and I'll show you a way to stay poor forever. So, my grandmother realized like You invest in great American companies and you just keep investing and you leave it and you leave it and you leave it. And she helped me buy my first stock at age seven in McDonald's.

Wow.

And that was seven years old. It was like she taught me, she taught me three lessons about money at seven that to this day, I still teach, which I can share with you. What's that? So at seven, we're sitting at McDonald's and she says, you know, David, you can get rich at McDonald's. I looked at her, I'm like, Grandma, I'm eating my cheeseburger and my french fries and I have my apple pie. I said, what are you talking about? And she's like, I'm not how am I getting a job here? She's like, see those people over there? They're working for what's called minimum wage. And I think back then minimum wage was like a dollar.

Nothing.

And she said, it's very hard to make a living on minimum wage. She said, then there's people like you right now, like all these people are coming here and they're eating and they're spending money. That's called a spender. And she said, then there's some people who own this place. and owners get rich. And she said, and I love to play Monopoly at seven. That was my thing. I'd go to my grandmother and she'd play Monopoly with me. And she said, I'm gonna teach you how to play Monopoly for real. And she took me home that day. She opened up the Wall Street Journal. She circled MCD. That's the symbol still to this day for McDonald's. And she said, here's how much McDonald's is. She put me in front of a television screen and said, watch the ticker tape. She taught me how to read that ticker tape. and she said, just call out the price on MCD. That's the price of McDonald's. And she said, tomorrow I'll take you on a broker's floor. We'll open up an account, and you'll, you'll buy one share of that stock. And then every time you go there, you'll know you're making money from yourself.

Wow.

And that is a wow, right? And it's funny because I'm here in LA with you, but I just went to Disneyland two days ago with my son. My son, who's nine. And Disneyland. Did you buy Disney? I bought Disney.

That was my second.

That was my second.

That's amazing.

So like literally at nine, I'm at Disney with Grandma and I'm like, Hey Mickey, are you guys public? Like, you know, 'cause she taught me to think as a child like an investor. I believe in the stock market. I give examples of earning 7, 8, 9, 10%. And I know stat wise, meaning like statistically, the rates of return in the stock market have been higher than real estate, but it's misleading. The reason it's misleading is if you give me $100,000 and you put it in mutual funds and I earn 10%, my $100,000 grew to $110. Follow me so far?

Yeah, and the next year.

And the next year, right? But if I put $100,000 into real estate, I didn't put $100,000 in real estate. I put in probably $20,000. The bank loaned me $80,000. So when that $100,000 grows to $110,000, I just made $10,000 profit on $20,000 investment. That's a 50% rate of return. And if I bought it as a personal residence, which is what most people do first, I can sell it and if I'm single, I can make up to a quarter of a million dollars tax free after two years. It is wow. It's the only thing I can buy and sell and get tax free money if I'm making money.

You have to pay You don't have to pay taxes on the money from selling a home?

On the first quarter million dollars.

If I'm single.

Why the first quarter million? That's just the government law right now.

Wow. The government. The first quarter of a million. In profit.

In profit.

You don't have to pay no taxes.

Wow. That's interesting.

I didn't know.

If I'm married, if I'm married, then what?

Half a million.

Wow.

Seriously. You don't pay taxes on any of that. You don't pay taxes on any of that. On the first half a million dollars. This is all across the US. All across the US.

Wow, I didn't know that. So like my home in Manhattan that we just sold because now we're moving to Florence.

And I'm not going back to New York, by New York. So the first half a million, you don't pay any taxes.

You can keep a half a million tax free.

Legally.

And I can do it over and over again. Wow.

So I've now done this three times. How much of a tax you pay.

On the other profit? Then you pay long term capital gains.

Yeah.

So I had a home in San Francisco, moved to New York, sold it. Got all that money tax-free. Wow. Bought my first home in New York, sold it, bought a bigger home in New York, got that money tax-free. Third home I've just sold. Got that money tax-free. I can never do that in mutual funds, unless it's in an IRA account. But that's a different game. And again, I want people to use retirement accounts.

Yeah.

And then I want them to own real estate. If you have those two vehicles, you pay yourself first, you save money automatically, and you own real estate. And by the way, I'm not against it. I want people to own rental properties too. I own rental properties. with my wife, she's got a rental.

Property in our building.

-Wow. -But the way you get usually your first rental property, you buy your first home, then you rent that home out, then you buy a second home, live in that for a while. -It's like Monopoly. -It's like Monopoly. Then you rent that home out. In the automatic millionaire, I say 3 homes over a lifetime and you're done financially, you don't need to work. -Yeah.

-2 of them you've rented out, you've got rental income, the third one you've.

Paid down, you have no debt and now you're in your 50s or 60s and you're not depending on social security.

Security. Yeah. And those two homes should be paid off by then, and then they're just paying you every month.

And we get people, you know, posting on our website all the time. We had one there a day ago. You know, 10 years ago, I had nothing. And now I've got five rental homes because I did exactly what you talked about. Wow. So it's, it's, these are not pie in the sky ideas. I'm not telling people to go buy homes and flip them. Like, I was listening to some radio ad on the way over here, and I thought, those are the things that don't usually work. You go to one of those seminars and they're free, and then next thing you know, they're putting you into a 30 $10,000 coaching program to flip homes. I'm just talking about basic simple stuff. Pay yourself first, one hour a day of your income, don't budget, save money automatically, and get yourself into a piece of property and then pay the debt down.

What are three steps people should do right now, whether they get this book or not, that they can start doing today that it's like if you did these three things right now, it could help you set you up for financial freedom later.

So, number one thing, Make a decision today to become financially selfish.

Okay.

And here's what I mean by that. Make a decision today to become financially selfish. Decide today to pay yourself first. So like if you were gonna have like little Chiron's it would be like your first thing is become financially selfish, pay yourself first. The formula to paying yourself first is one hour a day of your income. If we could get everyone watching to make it a goal to save one hour a day, whatever they're earning an hour. You'd be earning minimum wage. Literally, like you have a $15 an hour job. If you could save $15 a day. $15 a day, your first hour day of your income, especially in your 20s, you'd have financial security by the time you reach retirement.

So you say 15 bucks a day for seven years.

Well, seven years, I mean, like, I'll go back to charts, right? Because it's not, it It's always the compound interest over decades, right? So if you look at like, I've got these great charts back here. Let's just use $15 a day. In 30 years at 10%, it happens.

To be it's $1,017,000. So $15 for 30 years.

Yeah, in 40 years, it's, I got without my glasses on, $2.8 million. Wow. In 10 years, it's $92,000.

Still a lot, by the way.

It doesn't seem like a lot. You're like, 10 years, our savings. Here's the thing.

These decades go by.

Like this.

If it's automatic, you don't have to think about it.

You have to think about it. So I would say if you got a 401k plan just from this podcast, go sign up for it and save one hour a day of your income. Happens to be the math on that is 12 and a half percent of your gross income. With your company's match, which you probably will have, you'll be saving 16% of your income, which is like four times what the average American saves. It's huge. If you don't have a 401k plan, go open up an IRA account.

Fund that.

Or if you're self-employed, do a SEP-IRA. Second thing I would say is... Okay, so pay yourself first. Pay yourself one hour a day of your income. Second thing I would say is track where your money is going but don't budget. Having a dream without a payment plan is a wish. Having a dream where you're saving for it automatically, that's how it becomes real. Like in her case, she wants to take a sabbatical and she wants to travel. She's a travel editor who's never traveled. And he teaches her how to like save for this break. And then later in the story, I don't wanna give it away, but she like starts to take these trips. Well, she got there 'cause she saved for 'em.

Didn't it just happen magically?

Didn't it just happen magically?

Yeah, yeah. It just like unfold.

You're people, the thing is, you have such a great audience and people come here 'cause they want, 'cause they're great and they wanna get greater, right?

It's a school of greatness.

And Someone said to me yesterday, is there ever a point at which you feel like you don't need to grow anymore? I'm like, no, right? Because what got us to where we are is we're curious and we're growers. We were this mastermind together in Puerto Rico, right? And everybody's hugely successful at that mastermind. And we were all there to grow. We were all there with our journals taking notes on every single word that everybody was saying because we're still learning. So there's no finish line in life. I think that's a big thing that I try to convey in this book is that it's about living rich, but there's no finish line.

What advice would you have someone at 35 in that range of how to create a richer life while they build their business so that they don't have any regrets?

Well, I think that again, you have to figure out what makes you happy in life. And many times people don't know what makes you happy. I actually had no interest in making money. I came from a poor family. My father was a blue collar worker. I didn't have any interest in money. Nobody really talked about making money in my family. It wasn't something that was important to me. I just wanted to work in politics and government where you don't make any money. So I realized later on, though, that the thing I had chosen to do, the law, wasn't that exciting to me. And so I made a mid-course correction when I was 37 and got in the business and I liked it. I think people should experiment. I tell my children to experiment with many different things. And then, you know, by the time you're in your mid-30s you should probably figure out what makes you happy and where you have some skills and then pursue something in that area, though you can still obviously make mid-course corrections later on as well. I think that by the time you're 37 that you probably should have a reasonable sense of what your skills are, what you're good at, what you like. and then therefore probably pursue something in those areas where it takes advantage of them. But remembering that you should always have some outside interest. Just working all the time isn't going to make you happier necessarily. And so you should have some outside interest. You should learn how to get along with people, learn how to relax, learn how to keep your body in shape, how to keep your mind in shape, and just have a full and balanced life if it's possible to do so.

If there were, if there were, I know you don't really have any regrets, but you say you wish you would have done other things like playing music and learning a language and, you know, whatever, taking care of health maybe more as opposed to working as hard. If you could go back at 37 and you could say, okay, I want to commit to doing three things that I wish I would have done differently. Is that an instrument? Is that health? Is that, you know, relaxing, traveling? What are those three things you would have taken on differently? obviously hypothetical and you're happy where you're at, but what would you do?

Well, I wish I had probably been more involved in keeping my body in shape while I'm reasonably healthy. I probably didn't exercise enough and I didn't find a sport that I was good enough at to really stick with, so I wish I had been more involved in exercise and health kind of things. Secondly, I wish I had probably learned how to do something more creatively, like play a musical instrument or do something in the arts. I'm involved in the arts as a donor and so forth, but I don't have any artistic skills. And I, you know, be either be a painter, be a musician, be something that is more creative. I wish I had done that. And I wish I had spent more time, you know, probably as everybody says, with your children. You know, when you have children, when you're little kids, You can't do that much with them. You can change the diapers or you can run after them, teach them how to do some things. But when you're building your career, there's a temptation to kind of hand off the kids to others. And maybe in hindsight, I wish I had spent more time with my children now. Now, I have three children, all of whom have MBAs. And you can say I made a terrible mistake because there are no poets, there's no artists there. They're all MBAs and they're all in private equity. So you could say that these are very successful or very unsuccessful depending on your point of view. But as you get older, you realize the most important thing in the world is relationships. So you want to have relationships with your children and then ultimately your grandchildren and so forth. So if I could do it all over again, I'd do some things differently. But on the whole, I got lucky in life and it could be very well have been the case that I didn't get a job at the White House. start a firm like not mine. And I would today probably be just retired as a mediocre lawyer and living in, you know, somewhere in Florida playing shuffleboard. I'm, that didn't happen.

So I'm reasonably happy with that. Yeah. And what would you say? I mean, you have a lot of conversations with, you know, the wealthiest people in the world, but you're also friends with these people. Right. Just like I've been very fortunate to the people I interview, you know, I stay in touch with and I become friends with and hopefully I can stay friends with you, David, after this. But what are some of the behind closed door conversations that people actually open up about their regrets? They're really wealthy. Is it around? I wish I would have worked out more and been healthy because, you know, you know, a lot of people see Steve Jobs is like, okay, he would have given up all the money in the world to have more years of his life, you know?

Well, nobody who's wealthy ever says, I wish I was really a lot wealthier. Nobody says that because you realize how much money do you really need to spend and so forth. What people will say is, I wish I had spent more time smelling the roses. I wish I had spent more time with my children. I wish I had spent more time developing relationships around the world or around the country where I could get to know areas that I'm not an expert in. Nobody says, I need to make more money. I need to be higher in the Forbes 400 list. You know, people, you know, when you get to a certain point, look, all human beings as a general rule of thumb with the exception of 0.00001% want to live longer. Now, even people that have very unhealthy situations or are in poverty, nobody says as a general rule of thumb, I really don't like living, I want to die. Now, obviously people do commit suicide, it's a very small percentage of of the population. So why do people want to live longer? Well, there's a general rule of thumb, life has a lot of pleasures to it and you can be happy and that's a good feeling. So people, I think what they most want to do when they get wealthy is figuring out how they can keep this good thing going for a while. So all of a sudden you see, you know, very wealthy people starting to have exercise classes or a trainer or, you know, they're working out more. or eating healthier and doing things that can enable them to live longer and have the benefits that they've worked for, but have it longer. And that's what most people want. Now, your age, the last thing you're thinking about is retirement or you're going to die soon and you better get things done. So, you're so young. But at some point, when you're 67 or 77, you'll think about it a little bit differently.

Yeah.

It's funny though, because time has a, you have a different sense of time at different stages of your life. When I was like 9, 10 years old, I remember thinking someone in their 40s, I was like, man, they're about to retire. They're old. They're, you know, it's they didn't look as healthy back then. When I was in the 80s and early 90s, it was like, oh, man, they're kind of over the hill. But now people are living way longer.

They're staying more active in their 50s, 60s, 70s. Yes, of course. People live longer. When people came out of caves 400,000 years ago, the average life expectancy was 20. At the beginning of the 20th century in 1900, the average life expectancy in the United States was 49.

No way.

49. So today people expect to live longer. Now, when I was a young boy, there was a president named Dwight Eisenhower. You probably don't remember him, but you may have seen pictures of him. And I used to say, boy, that is an old, old man. Old, old man. Okay.

How old was he?

Well, he was elected president at 62 and he left when he was 70. So he's younger than I am now. When I was in the White House, I was 33 at the last year, I'm sorry, 31, 31 years old, and we were running against Ronald Reagan, who was 69. And I said, President Carter, you don't have to worry because Ronald Reagan's so old, he's 69, he can't get out of bed in the morning. Now that's two years younger than me. I read the other day when John Kennedy was assassinated, In November 22nd, 1963, they told the speaker of the house who was next in line succession after the vice president, that he would be right after the vice president. He fainted when he was told this that he was next in line to be president of the United States, if Lyndon Johnson was killed or something, nobody knew whether Johnson was gonna be killed that day. Well, he fainted and they said he was an old, old man, it's not unexpected they would faint. How old was he? He was 71. So, you know, and I'm now at that age. So, you know, it's surprising on the other hand, you have people like Warren Buffett who are 90 years old, brain still going strong. You just don't know exactly what it is, but clearly, you know, when you hit the age of 60, that you live more than you're going to live. And so, you know, you want to race to get things done. I'm doing what I call sprinting to the finish line, which is to say, I'm trying to get stuff done. that I never really did before, but I keep saying I better get it done because who knows when my brain is going to go away or the body is going to go away. So, you're too young to remember this and most of your listeners and viewers are probably too young, but at some point you realize that something is going to go wrong. It's a funny thing. You have your spotty you've got that you were given by your parents and this brain you were given by your parents, but you don't know which of these body parts is going to check out at some point. It could be that cancer comes along. It could be you're brain doesn't work and you just don't know. So you just gotta keep going as long as you can, hoping that these things stay along with you as long as you really wanted to be there. Clearly, sometimes things aren't gonna stay around and some body parts aren't gonna work and you won't be able to do everything you wanna do. So you wanna get things done before then so you don't have regrets when you're looking back.

Wow. Yeah, I think when I remember growing up, when people hit 40, they hit the midlife crisis back in the, you know, when I was in the, My young years, but when people hit 40, that's when they went through the crisis because I guess the expense expectancy was more around 70 or 80.

Okay, put it this way. If you were an NBA basketball player today, you would be called an old man.

Right.

LeBron James is 35-36.

They're making fun of Roger Federer. He's 39 years old. How can he play tennis anymore? He's an old, old man. You know, it's dominating.

Right.

But in some sports, You're an old person. Sometimes there are some athletes who retire in their 20s. John McEnroe basically retired more or less when he was 29. Boris Bjorn Borg retired when he was 25, I think. So some of these athletes, they're old when they get to be older. If you were a professional athlete today in almost any sport, unless you're, you know, Tom Brady, you'd be considered an old man, even though you're young. if you came to my investment firm, we would say, hey, this guy's young, he's too inexperienced, we can't give him too much responsibility.

If you're in the sporting world, all of a sudden you're an aged person. Yeah, if you're a gymnast or you're.

16, you're 18 year old, you never retired 18. Jack Nicklaus considered to be maybe along with Tiger Woods, the greatest golfer of all time. What was his most impressive accomplishment? I interviewed him for my book. and he had a lot of accomplishments, of course. But the one that most amazed people is that he won the Masters when he was 46 years old. How can anybody get out of bed in the morning in that old when you're in golf? But here he won it at 46 and, and, and Tiger Woods won it at 43 when he'd had all those back surgeries. And, but those guys for, in, in the golf World, 40 is kind of older. Remember, at 50, you can, you can.

Play on the seniors tour. Wow. Wow, yeah, this is fascinating. I'm curious, it just seems like this last three years really, there has been just what it feels like to me, a wave of ups and downs in especially in our country, ups and downs in the world, whether it be politically, whether it be society, whether it be our cultures, And new generations coming up, people trying to change old ways and create new ways. What advice do you have for the younger leaders in their teens and 20s for navigating, it just seems like everything's changing so quickly of roles and responsibilities and politics and everything. What advice do you give to young people to be a leader during so much uncertainty and chaos and unknowns? How do they learn to lead and have farsightedness when everything's changing all the time?

You can't control everything, of course. But I think people who are, let's say, your age, if they want to be leaders, the skills that I think are very important that really people should focus on other than the obvious persistence and so forth is continue to learn. You know, we call college graduations commencements. Why is that? It's the end of college, but actually commencement, it means beginning. And it really means it's the beginning of life and the beginning of your education. 30% of people who graduate from college never read another book in their life. They think they're done. So learning, always learning. Figuring out secondly, how to improve your skill set. How can you write better? How can you talk better? Remember, communicating is the only way to influence people. People are only influenced if you can communicate with them. And how do you communicate with them? By writing, by talking, or by leading by example, doing things like that. Well, practicing those skills. I tell people, people often say to me, well, you're pretty good at making a speech. I said, well, I wasn't considered very good many years ago, but I took every imitation I could get and I just practiced. I made mistakes and eventually you get better at it. When you first started this program, I assume you weren't as good as you are now, right? You've learned a lot. So take advantage of things, learn how to perfect yourself and focus. My resume shows I've got lots of different things I'm doing. But I started focusing on one or two skill sets and then once you have those, people come to you and ask you to do more things. So if you're very good at something, people assume that you may be good at something related to it. You'll get more responsibility, more opportunities and so forth. and you can never meet too many people. Everybody is helped along the way by somebody, having contacts, making networking people. You never know who's going to call you up and say, here's a business deal, here's a job opportunity, here's somebody you should hire. And so, if you think about how you met your spouse, how you met your partner, how you met your business partners, it all came about through some kind of serendipity that came about because you met somebody who introduced you to somebody.

You'Re speaking my language. I'm nodding this whole time for those that are only listening and not watching on YouTube because I did all these things that you've been doing in my 20s after I was done playing arena football. I remember thinking, I don't have any skills. I was a pretty good athlete and that was my skill, but now I got injured and I couldn't play anymore and I was like, I have no real world skills. I'm afraid to speak in public, I'm afraid to speak in front of five people that I don't know, I'm afraid to build relationships, I'm afraid to learn new skills. I was afraid of everything. And I remember finding some great mentors early on that I was inspired by their way of being, their energy, their model of life and business and career. And I would just learn as much as I could from them. and one of the things that a mentor said who was a professional speaker, he was like, go to public speaking class every single week. Join Toastmasters. And that's something I did for a year every single week. And just the act, like you said, the consistency of doing it and failing over and over again and looking humiliated allowed me to gain confidence. And now I'm able to speak in public, and it's something I do. But these skills, you've got to. I've learned that you've got to do them by. By messing up. We're not going to be good.

Yeah, look, when I interview people, people often say, how do you do this without notes? Well, it's not that complicated. What I do is I prepare extensively, as you obviously do, and then I write out the questions that I want to ask the person, and then I kind of more or less memorize them, and so I can have a conversation I kind of prepared, but I don't like to use notes because it kind of interrupts the flow. Same thing as when I'm making a speech. I don't use, even when I'm giving a commencement speech, I don't use paper. I will have written something out that it will be that I can give to somebody they want a written text, but then I will have memorized it. And since I wrote it, it will flow from my brain the same way when I'm speaking as when I wrote it. And then when you're looking at an audience, you get much better feedback when you're looking as opposed to looking down and up and down as you do when you're reading a text. And then people, I can speak for an hour on a that's not a subject. I'm usually speaking about subjects that I know something about without notes. It's not that hard to do. It just takes a little practice and you develop it. And I tell people to take advantage of speaking opportunities that you're given, but you can perfect yourself or whatever your skill set might be. Take advantage of all the opportunities you're given, perfect it. So some people can say, he's a really good writer or she's a really good speaker or something. And so you have something that people are talking about and you have a skill set.

And then eventually you'll branch out and develop other skill sets. Yeah, I mean you're saying it's not that hard to do now because you've got decades of experience, but I remember being 25 and if someone would have said you need to prepare a five-minute speech, it would have taken me a month to stress and analyze over and be fearful over and try to rewrite it all the time. But it does take practice and preparation. But the things that you said that I really love that I want people to think about here is learn to be a better communicator, orally because that's how you influence people, learn how to write better. Those are two things that I really try to master. I mean, not master but improve on in my 20s. And then relationships. I've built my entire business and life on relationships. When you don't have any skills, if you have the ability to connect and just make people feel good about themselves and show value in some way, and you can do that through just listening to people. you can have incredible opportunities with the right relationships. Wouldn't you agree?

Yeah, I agree. Look, how does humanity move forward? You have people who are leaders, people who are followers, but in the end, the only way that something gets done is when somebody does something that somebody else asked them to do or requires them to do. Well, how do you know how to communicate with that person what you want them to do? If you're Albert Einstein, you say, here's E equals MC squared. He had to convince people he was right. and he figured out ways to do it. And whatever you're trying to do, you have to convince people because you can't do anything by yourself. You can't build an airplane by yourself, you can't play football by yourself. You need to have teammates, you have supporters, friends. How do you convince people to be your supporter to follow you? It's by talking well, communicating well, by writing well, or by leading by example. So if you're playing arena football and you can't talk to your teammates about what the play is gonna be 'cause you don't know how to talk, Not very good. Or if you're not a good athlete and nobody's going to follow you because they think you're not a good athlete, you lead by example. You know, so you have to figure out how to communicate with people. Everything is communication.

I always tell people what you don't know can be your greatest asset if you let it because it ensures you're going to do it differently.

Absolutely.

And when I landed Neiman Marcus, All these people came up to me and said, I have been doing this for seven years, 10 years, five years. How did you land Neiman Marcus? And I said, I called them. And they just looked at me and I was like, why? What do you do? They're like, well, I go to trade shows and I set up my booth and I'm waiting for the Neiman Marcus buyer to come by and we've been doing it every year for seven years. I didn't even know there were trade shows.

Wow.

So sometimes just not knowing how it's supposed to be done. You have to have the courage though to say, even though I wasn't trained in this, because a lot of people think, well, I didn't go to school for this, so how could I possibly know? But you know, it's inside of you. Yeah.

And you were willing to be creative and risk failure in a way that most people aren't. You put yourself out there in a major way and you said, Hey, come to the bathroom with me.

Right.

And I'm not gonna do anything weird. It's amazing.

It's incredible story. My dad used to encourage me to fail. So at the dinner table growing up, he would ask my brother and me what we failed at that week. And if we didn't have something to tell him, he'd be disappointed. And I vividly remember being a little girl and saying, I tried out for this dad and I was horrible. And he would high five me.

And he'd go, Way to go!

Wow. So he was reframing my definition of failure. So failure for me became about not trying. not the outcome.

For those that don't know Spank, can you share how it all started so we have an understanding of what it is and how you got into it?

Absolutely. It actually started with my own butt because I couldn't figure out what to wear under white pants. And I'm sure you've had this problem when you're getting dressed.

All the time.

So what ended up happening was there was, you know, our undergarment options were no good. There was underwear that left a panty line, and then there was the girdle that way too thick and heavy. And so then they came out with the thong, which just put underwear exactly where we've been trying to get it out of.

Right.

The wedgie. And so Spanx was born out of just being a frustrated consumer. I wanted to wear my clothes. I wanted a smooth canvas. I didn't want to see lines or any kind of things going on underneath. So by taking the hosiery material, which was meant to be seen on the leg until Spanx sort of looked at it with a different lens and said, no, no, no. I want the hosiery material to actually be what I create the undergarment out of. And it was wild trying to convince the hosiery manufacturers to help me make this product with that in mind, because for so many years they'd been using the material to be seen on the leg.

Right.

I said, no, it's just, it's the perfect material to create the perfect canvas for women under our clothes. And it opened up my wardrobe, it opened up so many other women's wardrobe. We could start wearing colors we didn't feel comfortable wearing. and the models get airbrushed. We get Spanks.

There you go. There you go. I love it. And when was this? What year was this?

This was in, well, I cut the feet out of my pantyhose in 1998.

Wow.

Yes. I was 20 years ago.

Am I doing my math right?

Yes, I was 27. And then I spent the next two years getting it made. I worked at night and on the weekends on the idea while I was selling fax machine store to door. And then the company was launched in 2000 when I was 29. Wow. Yeah. Selling fax machines door to door.

Where were you living? In Clearwater, Florida.

Okay. Where I grew up.

Fax machines on Clearwater Beach.

Are there any fax machines anymore around? No. I mean, thank God I'm not still doing that.

I don't know what would have happened.

There are no more fax machines. Just like no one watches the movie airplane anymore. I cannot believe.

I need.

Know, is he the only one on the planet who's not seen a movie airplane? I was quoting airplane as soon as they put the headset on, I'm like, Stryker, you're too low.

You're too low. And you just stared at me like, what is she talking about?

That's a good guy. So how long were you selling the fax machines? I sold the fax machine store to Door for seven years. Seven years? Yes, I know. And before that, I wanted to be.

A lawyer, but I failed the LSAT.

Not once, but twice. You wanted to be a lawyer? That was your dream. I wanted to be a lawyer. I was like, I'm gonna be a lawyer. My dad was a trial attorney. I used to watch him in court when I was a little girl. And I'm a terrible test taker.

And so- I am the worst test taker. Are you the worst test taker? I was in the bottom four of my grade, my class, all through high school, 'cause I could not take tests.

And I always felt like the dumbest kid in the world.

Isn't that, doesn't that suck? I mean, it's- It was like the most insecure feeling. And we ranked, we had rankings on our grade cards. So I knew exactly how dumb I was. Oh no.

Always in the bottom four, I was miserable. Test taking, why is this so hard? Test taking. I don't know. I have trouble reading and comprehending. Me too. I really do. Like, I, those SRAs, are you too young for SRAs? What's the SRAs?

Forget it.

I don't know. But everybody at school, I used to have to take the SRAs and I would read the paragraph and be, I remember vividly reading it and halfway through, I'd be like, Remember what I'm reading, remember what I'm reading, remember what I'm reading. And I looked at those four questions at the bottom and be like, I don't know what I read.

So I'd go back up and start over again. You're speaking, this is my life.

Really?

And I would just like make stuff up constantly. Whenever I had to comprehend, I would just read the same page over and over and I'd be daydreaming so much.

That I couldn't remember it as well. I either made stuff up or I sat next to Christina. And she was so smart.

I was the king.

That's right. Growing up, she ended up going to Dartmouth and was like valedictorian or something.

I'm like, I'll just sit next to Christina.

Did you have Scantrons? Do you remember that? No, I'm a. Okay, you can't remember.

Scantron.

We were doing things with a Number two pencil.

I did that too. That's a scantron. Scantron is like multiple choice. It's like a long sheet with a multiple choice on multiple choice. Did you have that?

Multiple choice, we had to fill in the bubbles?

Yes.

Yeah, okay, that's scantron. And when you skipped a bubble and then time's almost out and you realize.

You'Ve just done all the wrong bubbles.

On the whole page.

You're like, no! Exactly, but I'm on the same page. You're bringing up a lot of stuff. I'm remembering all this. I used to cheat because I couldn't comprehend, so I would have incredible vision. I would be like this, but I could see through and like see all the stuff.

That's a dead giveaway. Like any kid in the class like this, just you knew that they were cheating. No one ever caught me, so.

All right. It's how I got through school was cheating. I could not have made it through class without it. Christina.

You had your girl.

That's hilarious. So you were a cheater as well.

Well, I'm just saying, Christina sat next to me.

You were an innovator.

I was resourceful.

Exactly, I like it.

I was being really resourceful.

But, so you wanted to be a.

Lawyer, but it didn't work out. I wanted to be a lawyer, I failed the LSAT, not once, twice. So then instead of going to law school, I drove to Disney World and.

Tried out to be goofy, but you.

Have to be 5'8. And you're 5'6. And I'm 5'6.

So you didn't wear heels?

No, I didn't wear heels. I didn't wear heels. And so I was the height of a chipmunk. Oh, so you got the chipmunk? I got the chipmunk part, but I didn't end up doing it. I put people on rides in a brown polyester spacesuit at the World of Motion on Horizons at Epcot.

Epcot Center.

And I would see people that I hadn't seen in a while and... Come through. Yeah, I'm walking on the moving sidewalk, putting people on rides and they'd go, Hey, Blakely, is that you? Didn't you graduate from college?

And my big Mickey Mouse ears said.

Sarah Blakely and I'd be like, Yes, get on the ride. Oh my gosh.

But that's what I did. And then I sold fax machines door-to-door for seven years. Seven years. Did you wake up every morning and.

Say, this is my dream?

To sell fax machines door to door? Were you thinking, no. What am I doing in my life?

Exactly. So what happened was a lot of people think that Spanx started when I cut the feet out of my pantyhose, but actually it started long before that. It started when I was selling fax machines door to door and getting my business card ripped up in my face being escorted out of buildings all day, every day that I woke up one day and just thought, I'm in the wrong movie. Like how did this happen? This is not my life. Cut scene, director, like call the producer. And I got out a piece of paper and I wrote down, what am I good at? And the only thing in the good column was sales. And I thought, okay, what am I going to do with that? And I ended up writing in my journal, I'm going to invent a product and sell it to millions of people that will make them feel good. And then I asked the universe for an idea, and I was very specific. And it took two years, and I only cut the feet out of my pantyhose one time, and I was not going to squander any idea the universe gave me because I had really asked for it. And then the minute I cut the feet out, I started trying to make it. I started looking up manufacturers on the internet.

This is before Alibaba, wasn't it?

Yes.

Because I did this about eight years ago and I used Alibaba for something and it was easy to find a manufacturer in China and test different things. But how did you find a manufacturer at that time?

A website called Thomasregistry.com and it lists all the manufacturers in the country based on category. And that's when I found out that a lot of hosiery and undergarments were being made in North Carolina. Oh, really?

Yeah.

So you got a local. Yes, so in the US.

Yeah.

So I called and called and no one would take my call and they'd either hang up on me or say they weren't interested. So I took a week off of work and drove around in person.

And just showed up and said, I just showed up. Hey, I want to create a sample. Yeah. Because if they weren't gonna get a big order for something, they're probably like.

What'S, I'm not gonna do a little sample for you. Right, right, yeah. I showed up with my lucky red backpack. from college, always with me.

You still have it?

Yeah, of course. You didn't bring it here?

Come on.

It's with me, it's with me in LA. Yeah.

Oh, wow.

Yeah.

So anyway, I went into the manufacturing plants and they asked me the same three questions. And you are, let's say, Sarah Blakely, and you're with?

Myself.

Sarah Blakely. And you're financially backed by it. I was like, Sarah Blakely. So you can imagine how those went. It was like, well, have a nice day, honey, and good luck.

And.

About a few weeks after I made all those rounds, I got a call from a guy in North Carolina who had took pity on me and said, Sarah, I have decided to make your crazy idea.

Wow.

And when I asked him why he had the change of heart, he said, I have three daughters.

Wow.

Yeah, so he ran the idea by them and they're like, Dad, that sounds interesting. You gotta give that girl a chance.

Amazing. So he called you back, you didn't follow up with these people.

Oh yeah, I was following up, but to no avail.

Gotcha. But he followed up and said, yeah, we'll give it a shot.

Yes.

We'll make this. So what was the next step? Was he just making a sample for you or testing different models or sizes or?

Yeah, so it just set up to make the garment. While I was making it with his manufacturing plant, I was also wanting to patent the idea and I was also trying to come up with the name for the invention. So I was doing those three things simultaneously, driving up on the weekends and working with Ted in the back of the manufacturing plant that I'd become very close with.

And driving to North Carolina from Florida.

No, from Atlanta.

I was living in Atlanta at the time.

What's that about? Eight hour drive, six hour drive? About four and a half. Oh, it's not bad. Okay. Yeah, it's not bad. And so anyway, Ted, Ted became my buddy and I went to get it patented, but all the patent lawyers wanted between three and five thousand dollars, and I had five thousand dollars set aside to do this. That's it, yeah. So I wrote my own patent. I went to Barnes and Noble. No way. And I bought a book called Patents and Trademarks, and I wrote the patent, and then I called one of the patent lawyers that was the nicest to me and said, Please, please, please, will you write the claims over the weekend.

For a discounted price? I've done all the other rest of the patent. the legwork you'd done.

Yeah.

You just kind of needed to button it up and.

Yeah, you needed to sign it off. The legal part. And so he did. He actually admitted to me that when I came to visit him, he thought.

I'd been sent by Candid Camera, which.

Let me put it in your.

I know Candid Camera. I know.

He thought he was being punked. Of course. Of course. Wow.

Yeah.

He thought he was being punked.

Okay.

And he thought. Where's Ashton? Yeah, exactly. He thought that his friends. We're playing a joke on him. No way.

Yeah, he goes, who's this girl?

He goes, Sarah, I mean, like, you're not the typical person who walks in the door saying, I've got a product and I want a patent. So anyway, he did that. Then at the same time, I'm trying to think of the name. I had horrible names written on scrap pieces of paper all over the place in my apartment, in my car, in rental cars on the back of, like, Avis agreements. And you want to hear how bad.

The runner-up name to Spanx was?

Yeah. Open toed Delilahs.

No way.

Yes.

I cannot believe that was even an option.

It was, it was a runner up. Like how mad is that?

Open toed Delilahs.

I so wouldn't be sitting here with.

You right now if I named it that.

That is the horrible, yeah, so bad. Wow. Yes, so anyway, okay, so what does Spank stand for? Well, it's all about the butt. And it makes your mind wander a little bit. Nobody ever forgets it. I had no money to advertise. It was risky. It was fun at the time. Listen. Now it's become a household name. But when I first invented it, I would call people and say, hi, I'm.

Sarah from Spanx and they would hang up. Right.

Because I thought it was probably like a porn thing. Yeah, they thought I was pranking them. I'm called, I'm like, no, really, I'm Sarah and my company really is called Spanx. And I had department stores across the country that wouldn't sell it. They thought it was too risque of a name.

Yeah.

And my mom sent her whole luncheon to the wrong website when I first started. I was like, Mom, it's with an X. Oh my gosh. Super important. It's with an X. So yeah, anyway, I ended up buying the word Spanks from a man who said he was holding out from the porn industry. Funny enough that you say that.

I bet, yeah. I paid Spanks with an X. I.

Paid some money for that. But, anyway, yes. So, amazing. Named as Spanks. It came to me because I narrowed down my thinking. I knew that Kodak and Coca-Cola were the two most recognized names in the world at the time. and I thought, what do they have in common? I like to think about words and phrases a lot. They both had a strong K sound in them. And the man that created Kodak liked the K sound so much he took a K and put it in the beginning and the end of the word and played with letters in the alphabet. So, and I also had a bunch of friends who did stand-up comedy and it's this weird trade secret among comedians that the K sound will make your audience laugh. So I put all that together and I'm like, okay, I want my product name to have the K sound in it for good luck. literally Spanks came across my dashboard in my car in my mind, and I pulled off the side of the road. I wrote it down. I went home that night. I typed it in my computer for 150 with my credit card. And at the last second, I backspace the K and the S and put in an X and hit set.

So it was accident kind of with the X.

No, I didn't.

I know I backspace.

Gotcha. I backspaced because I stared at it for a while and I had done research that made up words do better for product than real words, and they're easier to trademark. So then I had the name and I had the patent in the works. Got my prototype and my patent lawyer said, Sarah, I need to know what's in this garment in order to write the patent. I said, okay, no problem. We'll call Ted. So I get Ted on the phone. I'm like, Ted, can you talk to the manufacturer? Yeah, in the back. I'm like, Ted, can you talk to my patent lawyer? He's like, yeah. So we're all talking and he goes, I go, Can you tell him what's in it? He's like, yeah, well, it's 70% nylon and 30% lacquer. And I'm like, All right. And so I'm taking notes, my patent lawyer's taking notes. And that night I could not sleep. I'm up all night and the next morning I wake up, I'm like, How.

Is there lacquer in this product?

What is lacquer? Just so I'm aware. I think it's like paint thinner or something. Okay. So I called 30% paint thinner. So I called Ted, I go, Ted, Can you spell lacquer? He's like, yeah, L-Y-C-R-A. Oh my god, Lyra.

Oh yeah, it's Lyra.

Got it.

Doing all change on lacquer immediately. My patent lawyer was laughing. You know how fast you would have gotten a patent if you tried to make this out of paint thinner? He's like, they would be like, Sure.

So was it challenging to get it? Did you get it the first try? try.

The patent. I did.

Wow.

Usually it takes a few turns, doesn't it? I got the patent the first try, and I got the trademark name Spanks.

Amazing. Yeah. So it didn't seem like there was that many challenges once you submitted it or whatever. You kind of got the things you needed in place. You got the, the orders in. Was, was there a lot of challenges after that? Once you got the patent, the trademark.

That was a really hard part. It's just, I heard the word no for two years.

Yeah.

All the manufacturers, nobody thought it It's a good idea. And also when you're just yourself trying to break into an industry like you mentioned, the manufacturers, it's not really in their best interest to slow down machines or try to give a girl with a couple grand a chance.

Unless you're gonna give them a bunch of money for a big order of something.

Yeah, it's like what's the point? Right. So that was the hard part. And then once I had it, I cold called Neiman Marcus and that was the first account I called on.

Did you get it?

Yes.

Well, you were great at sales.

Well, listen, you could sell it. I was so excited. It was my moment. I flew to Dallas. I called them and said, if you give me 10 minutes of your time.

I'll come and meet with you.

And she said, all right. This is a buyer. Yep, the buyer. I first called the Atlanta store. They're like, girl, we can't help you. We have a buying office. I'm like, well, where is that? Give me their number. And I went in, and halfway through my pitch, I could tell I was losing her, so I said, You know what? Will you please come to the bathroom with me? And she was like so buttoned up. I mean, Neiman Marcus, like her pen matched her belt that matched her shoes.

And she was like, what?

And I was like, what am I gonna do in the bathroom? I was like, Just follow me to the bathroom and show you my own panty line. And I went in the stall with Spanx in my pants and without it in my pants.

And she was like, oh, I totally get it.

It's awesome. And I'm gonna put it in seven stores. Wow. Yeah. Oh man, just like that. Just like that. It was so unbelievable. I was so nervous. And then of course I had to call Sam. I'm like, in the rental car on the way back to the airport, I called the owner of the manufacturing plant. I'm like, Sam, Sam, it's Sarah. I need more. I just landed Neiman Marcus. And he's like, what? He was in shock. He goes, Sarah, I thought you were going to give these away as birthday presents for like years. And I said, no, Neiman Marcus just bought it and I need more. And he patched me through to Ted. He goes, okay, you need to talk to Ted. So Ted comes back in. He's on the phone. and I go, Ted, I need more. And he goes, I go, I just landed in even Marcus. He goes, well, that's great, but what.

You can do about the crotches.

The crotches? Yeah, exactly. That's what I said. I go, what? Don't they come with crotches? We've been making them with crotches.

He goes, well, yeah, but we only got one crotch machine.

It's being used by somebody else.

No way. Yeah. So what do you do then?

So I just landed in even Marcus and I have no crotches.

Oh, my God.

Is it a hole in your crotches?

I don't know where to go.

I love for a crotch.

I mean, I don't know.

I don't know. Where do you go?

I actually looked in the Yellow Pages. Crotch making machines? Yeah, I just, well, I looked up crotch.

Crotch machine. I looked up crotch. I don't even know how you spell crotch. Okay, listen, this is what I learned. I'm gonna teach you something. Okay, so I didn't know this. What's Yellow Pages again? Yeah, oh my gosh.

It's a big book.

It's yellow. That's what we used to look at.

Hilarious.

What's Instagram?

Oh yeah, you just got on it.

Okay, I just joined it seven days ago. All right. So, where was it? Oh, crotch. Yeah, yeah.

Crotch machine. So, yeah.

So anyway, in the yellow pages, it's not under crotch. So I learned there's a fancy word for crotch named gusset. Gusset. Yes.

What?

Gusset.

Never heard that word. So I started calling gusset companies. They were like, FedExing me crotches from all over. My roommate would come home and be like, you got another crotch in the mail. And then I ended up finding a man by the name of Gene Bobo. that worked for a crotch company just 20 minutes north of where I lived in Atlanta and he saved the day and they made the crotches and then I could deliver Neiman Marcus.

So you had the leggings, they made the crotches and then you sewed them.

Together, is that's how it works? Yes, apparently, yes.

Gotcha. Okay.

Okay.

So then you had enough, how many did you print the first time? 3,000.

3,000. 3,000 pair of the first spank.

One skew, right?

Or 20 dollars, one skew. sizes or like four?

Four sizes?

Yeah.

And 3,000 of them. Yes. And that's what Neiman's ordered. And then I sent them to the, they sent them to the seven stores. I had no packing and shipping department, so the semi-trucks were pulling up to my apartment in Atlanta and I was shipping them myself to Neiman's. This is amazing. And then I called every friend I had in those seven cities, like people I hadn't talked to in 20 years.

So hey, go buy a few of these. Yeah, take your girlfriends there.

Hi Christina, remember me? I used to sit next to you all the time in grade school. Will you please go buy this product called Spanx? I literally called them and I said, and I'll mail you a check. So I paid all my friends and friends of friends to go buy the product.

That is brilliant actually.

And I said to get some moves. Yeah, I said go in. I gave him a whole script. I'm like go in and say I've been looking for this all my life. I can't believe it's here and create all this excitement. This is amazing. And then of course a week later, I talked to the Neiman's buyer and she's like, Sarah, we are blowing out. I'm like, you don't say.

No way.

Well, I was buying them all.

Yeah.

Brilliant. You have to.

Wow.

Incredible momentum. You have to make sure your own success. Absolutely. So then once I started running out of money, Oprah called and put it.

On as her favorite product of the year. How long was that for?

Until the time was in Neiman Marcus to Oprah calling. like a month. It just happened that quick.

A month or a month and a half. How did she even hear about it in a month?

I sent it to her in a gift basket and her Andre, who dresses her, put it in her dressing room and she put them on and has basically worn them every day since.

Shut up.

I'm not kidding. It was so unbelievable. I had no money to advertise. I'm in the back of my apartment. I was selling fax machines like a month before that. But I have to say, I was working every night and on the weekends for two years quietly trying to get this made.

Building this thing.

Yeah.

Building it.

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My journey has been filled with hundreds of no's, tons rejection and I feel like figuring out how to not take it personal has been huge on the business side of things. Like it's always hurt to be honest, it's always hurt. But also I believe and no matter if someone believes in God or the universe or whatever, when I look back at everything I've gone through, especially this last 10-year window, there's a famous saying, rejections God's protection. You could say rejections is the universe's protection, right? Whatever applies to each person listening, but I believe it. And it's, I mean...

So that person shouldn't have said yes to you. It wouldn't have been the right fit for you.

It wouldn't have been the right fit. I mean... Or the right timing or whatever. And what's hard, and here's the hardest thing, is so many people actually never step out of their comfort zone because they're so afraid of rejection. Because it freaking hurts. It sucks when it happens, right? and sometimes it doesn't make sense and it doesn't feel fair. And I remember, you know, gosh, one rejection out of hundreds in my journey. Because, you know, I thought I was going to be a news anchor and I'll talk to the host my whole career. I love other people's stories. I just want to interview you right now. It's like since the time I was a little girl, it's all I wanted to do. And I was working in my dream job as a news anchor and I started getting this skin condition called rosacea, which is bright red. And there's like bumps and all kinds of stuff. And I thought I was going through this big setback in my career, and I would be anchoring the live news, and I'd hear from the producer in my ear, like, there's something on your face, there's something on your face. And I'd be live, and they were like, you need to wipe it off, you need to wipe it off.

And I knew-- then it probably get worse. Yeah, it's like spreading out more.

You're like, ah. I'm like, ah, and I knew I knew there wasn't anything I could wipe off. And I started going through this season of self-doubt where I started thinking, okay, am I gonna lose my job? Am I gonna lose viewers? Is my boyfriend still gonna think I'm cute? All those thoughts that we tell ourselves. And I started thinking I was in this big setback, but what it was really was a setup for what I was supposed to do. And I think so often our setbacks our setups. It's just hard to see it at the time. And I started, you know, trying every makeup out there from the most expensive to the least to everything. I couldn't find anything that works. And I made this decision to literally leave my dream job. Like, I think sometimes knowing when to let go of a dream is as important as knowing when to go after one. And I feel like so many people are always like, just don't give up. Just don't quit. But I actually think that doesn't always apply. I think that like the victory is knowing when to hear yourself and trust yourself and let go of a dream or step into one. But what I didn't know is stepping into that dream would be faced with three years of constant rejection. So from the moment I quit my job and my husband I wrote our business plan and our honeymoon flight South Africa, got back, dove all in, put everything we had into a product. And once we finally had a product that worked for me, I just thought, oh, it's gonna sell. It's just gonna do well, right? And it was literally three years of every single beauty retailer, all the ones I loved, and the ones I thought, oh my gosh, I put them on a pedestal. And I thought, oh, they're gonna love this because it works, you know? So I would send it to Sephora and Ulta and QVC, all the places and they all said, like every one of them said no.

For three years.

For three years, we got down to under $1,000 in our bank account, which was our company and personal combined. Literally, it was no after no. And I mean one no that stands out just to share this, because anyone listening, part of your greatness community, like dealing with rejection, dealing with setbacks, dealing with It's hard when you check in with your gut, you feel like you're supposed to be going after this dream or creating something or launching the podcast or creating the product or whatever. It's hard when you feel like it's the right thing but then there's no proof of success around you.

No one's buying into it.

No one's buying into it and then your own self-doubt starts taking over, right? And when you have experts telling you they don't believe in what you're doing, that's hard. And I remember one moment in particular when we got interest from a private equity firm. And I was like, I was so excited because we had had so many nos. And I thought, okay, if they invest in us, and this was a big private equity firm, they invest in a lot of consumer product companies that we see at the grocery store, like household names, right? And they invest in a lot of them pre-revenue. they become big companies. I'm like, oh, you know, if they invest in us, A, I won't go bankrupt. B, maybe they can use their leverage to get us into these stores that are telling us no, they don't want our product. And so we started the meeting process with the investors and went through the diligence phase and presented our product pipeline and showed our budgets. And I'll never forget the final meeting. And my husband, Paulo, who you he was there and then the head investor was like three feet from me. And I thought it was going to be a yes. I was so excited. And he literally was like, Thank you. We want to congratulate you on your product. We think that it's awesome. We want to wish you the best, but it's a no. We're going to pass on investing in It Cosmetics. And I was like, okay, can you tell me why? Because feedback is usually Feedback's usually a gift, not always. Yeah, yeah. And I was like, can you tell me why? And he looked at me and he's literally three feet from me and he says, do you really want me to be honest with you? And I said, yes, please. And he says, I just don't think women will buy makeup from someone who looks like you with your body and your weight. Right? And so this was a moment, when he said that, I don't think women will buy makeup from someone who looks like you with your body and your weight. It was this moment where I was looking at him, right? And it was almost like watching his lips move in slow motion. And I remember two big things from this. I remember my whole body flooded with a lifetime of body doubt and self-doubt.

And God doubt, you say?

Yeah, God, everything. But it felt like I was staring my fear straight in the eye. It was almost like it wasn't even about him in this moment. But, and I knew like, you know, that, that two things. I remember that and I remember this moment in my gut that told me, even though I was in pain at the time and it hurt and this was like a big rejection, I also felt this really strong moment of feeling like he's wrong. Like a knowing, like a deep knowing. But I also knew that like if I was ever gonna prove that I would also have to truly believe it, you know what I mean? It was tough. I went to my car and cried and didn't know what we were going to do. But one thing that, and I did a lot of things wrong in my journey and I share those in the book, but one thing that I did right was like through all the rejections, I actually never took them personal. And with him, mm-mm, and with him I felt no anger toward him and I had this big moment. So two big things happened and then I wanted to tell you the full story. the whole rejection is God's protection and rejection is the universe's protection. I have to tell you what happened. This for anyone listening going through a setback or rejection right now, because I have hundreds of stories like this now after building this company and hiring over a thousand employees and all the stuff that we've done on the way. Okay, so two things. One is when I was creating this company, company, right? And you know, you hear about a lot of, you've had people on your show talking about finding your why and finding your mission and all that kind of thing. And everyone knows about that, or a lot of people have read about it. And I think knowing your why is important for any goal or any dream. But two things happened. When I created the brand and I was like, why can't I find any product that works? Like, I don't understand this. This is when I was working as a news anchor. I had this moment where I realized, oh my gosh, my whole life Even when I was a little girl growing up, all I ever saw was TV ads or magazine ads. I loved them. I loved them and I always saw the models and I always aspired to look that way, but they always had flawless skin. I never saw anybody that had rosacea or any type of challenges. And I realized two things. I always had aspired to look like them, but they also always made me feel not enough. because you could look like them. Yeah, what was called beautiful, I didn't see myself in, right? And so I had this whole idea, which is part of why all the retailers were saying no in the early years. I had this idea to not just create products that work, but let me show models, all different people, every age, skin tone, skin challenge, gender identity, skin problems, side, like let me just show real real people and prove this product works. Let me go on QVC and prove it live. Let me show my own rosation. I just thought if people can see people that look like them, this just makes sense to me. But all the experts said it didn't. So back to me standing there with this investor saying, I don't think people will buy makeup from someone who looks like you with your body and your weight. After I went in my car and cried, it Rejection always still hurts. I also just remember feeling like, wow, he's passing on investing in my business. He's making a business decision because of exactly why I'm starting this company. He's just as much, I don't want to call it a victim, but just as much impacted by the definition of beauty that's out there. and he's literally passing on investing in my company because of it. And so it drove my deep why for like why I was building this company. And I took that rejection as fuel for like, oh, this has got to change, right? And for me, it was like, let me build a company where we show all types of beauty, where it wasn't even just about selling product. It wasn't about solving my own problems. And even though I want to help millions of women and all that, the real why was like, can I shift culture and beauty for every little girl out there who's about to start doubting herself and every grown person who still does? And so like that drive fueled it and not being afraid of rejection is so huge and it's really huge for women because it prevents a lot of people from even and it hurts. It always sucks. It never feels fun. But I got rejected so many times on this journey and to finish this thought about how rejections God's protection. So the day this dude tells me this, right? Fast forward six years and the day that L'Oreal bought our business for $1.2 billion cash, it was It was all over, they had to announce it because they're a public company. So it was on the Wall Street Journal homepage. It was everywhere. And I got an email from him. He emailed me. What did he say? I got an email. He said, Congratulations.

I'm so, so happy for you. I was wrong.

And have you stayed in touch in those six years? Not with him. With everyone else that rejected me though, I did often. So I was always like, It's gonna be a yes. It's gonna be a yes. With him, Here's, and this was six years, right, until this moment happened. But what I realized that day is when we talk about rejection is protection, I was so desperate in those moments when I wanted him to invest that we probably would have sold him the majority of the company for no money because he didn't believe in us. Two things. We found out we would have been his most successful investment in his firm's history. but then also because he didn't believe in us and also we got a lot more rejection on the way, by the time that L'Oreal acquired our company, we were still the largest shareholders. So it was like, okay. So I was so glad he didn't believe in me then. But when rejection happens, it's not easy to see it in that moment. It always does hurt, but I always believe.

I was gonna ask you, do you feel like if anyone would have said yes or invested or whatever from him or anyone before that, do you think it would have been successful if people did believe in you?

I mean, there were definitely people along the way that did believe. There were. I just believe in the timing of things, and I believe in trusting our gut and going with our knowing, you know, with everything.

And what if he would have said, yeah, I'm gonna give you a million dollars or whatever it is to invest and I'm going to take this much equity, do you think it would have been a successful of an exit or you think you would have been driven to serve more at a higher level with that support and with that backing or would it have made you more complacent in some ways during that process?

I don't know. I mean, I think the only thing that would have gotten in my way is if he owned the majority and wasn't a great partner because I wasn't driven by the money. Like I wasn't. I was driven by, you know, what I know I'm born capable of giving. And also just, I loved our mission. I knew what we were doing. We were shifting culture inside the beauty industry. And, you know, there were a lot of people that believed in us along the way. And, I mean, with L'Oreal, we got a champion inside of L'Oreal three years before we actually did the deal. And she kept wanting them to like, you know, she's like, look at what this brand's doing. what this brand's doing. We would do meetings and they'd end in no. So it was three years of that as well until they acquired us. But yeah, there were people that got it. And then a lot of us learned this lesson. Once we did get into all the retailers and started doing really well, then they all believe in you.

Of course, yeah.

Once you get results.

Yeah, when you make people money, they like you.

Of course. They want to be a part of your success. You know what's interesting? There's a meme online of a kid of a little child learning to walk. And it says something like, you know, when a child is learning to walk, they fall over hundreds of times. And they hit their head and they scrape their knee and they, you know, they cry and these things. But at no point do they think maybe this walking thing isn't for me. They don't say, I'm just gonna crawl for their next 80 years of my life and just crawl everywhere. They eventually keep getting up and they learn to walk. They balance, they hold on to something, right? Yeah. You've got kids and so you've seen this firsthand. They never stop trying to walk. Why do you think we as adults stop trying to walk into our dreams or into opportunities when we hit ourselves one time, we fall one time? Why do you think we stop when it's Kids, we never did when we were learning to walk.

I think I've never answered this question before, so I'm just going to pour it right out to you. How I really feel about that. I think kids have a knowing inside, an instinct. They want to walk, and they just think that they're going to figure it out. They see people around them walking, and they just do it. It's like a knowing, and nothing's telling them not to trust themselves. And I think that as we grow up, I think that everything around us starts to to tell us not to trust ourselves. Like self-doubt is so huge. And just to use my own example, and some of the stories that I share for the first time ever in the book, is like when you're in the spot of all the experts telling you they don't believe in you. Or it could be other people's opinions telling you they don't believe in you. It could be literally no proof of your own dream or idea that it's going to be successful. In those first three years of this journey of it cosmetics, there was no proof. It was like no signs, right? Other than women were starting to post their own before and afters and spread the word online, which was great.

So you were getting some sales.

Yeah, we were doing like two to three orders a day on our website.

Were you doing like, you know, were you going and sharing, showing it in person at a live events? Were you doing QVC at this point?

No, not. So QVC was our big, big, big first yes and probably the scariest, probably the biggest life and business decision, business lesson I've ever learned.

When did that come? After three years?

Yeah, after three years.

So the first three years were you going to grocery stores and you know... I tried everything. Going to the fairgrounds. Anything.

Anything online. We could advertise. Any different beauty event. I mean, we would, my friends and family would walk in into any Ulta or Sephora and be like, and they knew they'd get some of it. Can I talk to the manager? Do you carry it? Cosmetics? They're like, it what? They go, oh, it cosmetics is so good.

And they would try to hustle for us. It's very Sarah Blakely-esque where her friends would go and like, oh yeah, place.

Orders and make it all sell out. And it was that. It was just trying to hustle. And the other thing is all the no's, like every time Sephora or QVC or Ulta say no. That was one thing is that I didn't take it personal. I did a lot of things wrong. There was one thing I did right. And the second they would say no, it hurt. It sucked, obviously. But it's like, okay, I would literally, Louis, I would decide to believe it's going to be a yes. And I behaved accordingly. I would say, okay, thank you. But one day it will be a yes. And I'm so excited for when that happens. And then what I would do is every time we get like a press placement or we would be launching a new product or whatever, I would send that buyer who kept saying no and I'd be like, Great news! We just got, you know, in this magazine or whatever and like one day when your customers get to try this in their store, they're gonna love it. I think they probably thought it was crazy but I just decided to believe.

You've got to be relentless in following up too. You can't just hope that they find out about you. you've got to constantly be following up the way you did, right?

Yeah.

They're not gonna look at the magazine and see it. They're not gonna see your sales numbers unless you tell them over and over again.

Yeah, and I know you're big on LinkedIn and everything. I would literally scour LinkedIn for any person who worked at Sephora or Ulta or QVC.

Find them and message them.

Everything and then try to send them a sample. I mean, it was like everybody. It was, and we couldn't afford to hire anybody So we got so lean and so scrappy that in the early years, my middle name is Marie. And so Marie got her own email address. So Marie@cosmetics.com was like head of customer service. And I would pitch all the Good Morning America, I'd be like, Our founder's available for, you know what I mean? It was just like hustling and trying to figure it out. And every time I would check in with my gut though, no matter how many times I got knocked down, like I still, even though there's no proof around me, I still kept feeling like this was what I was supposed to do. And I made the decision to trust it through those years of no proof around me. And that's the hard thing. And I feel like when you talk about why does a little kid keep trying to walk, but why do most of us just give up? I feel like that we don't, I feel like So many people either have never heard their own gut or haven't heard it in a long time. And then sometimes we hear it and we don't trust ourselves, right? And instead of putting our own intuition on a pedestal, we put things like other people's opinions or what our partner is telling us to do or our own self-doubt or what the experts are saying or the lack of proof of success around us.

How do you think we learn to trust ourselves more?

I think that we have to want to. I think we have to make the decision that we need to want to. And that's hard because you know what? The truth is it's way easier to stay in our comfort zone. It's way easier to make the circle around us happy and comfy and not fearful. It's way easy. And I think that chips away at our soul when we do that. I think every person knows, like, I think we know deep down inside if we're created for more and we're supposed to give more, if we have more inside of us to give or to serve or to love or to live, I think we all know that deep down inside. And I think that if we don't do something about it, I think it chips away at our soul and I think we end up literally talking ourselves out of our own truth and literally never becoming the person we're born to be. I know that sounds dramatic, but I think it's true. And I think that What? I think that's the easy, easy route. So I think the first thing is you have to want to. Like you could make a bad investment.

That would still be better than a smart spend.

Really?

So what's a smart spend? What's a smart spend versus a bad?

I mean, I don't really know anything.

That'S a smart spend, but you know.

You spend money, when you spend money.

You don't get an investment back.

And when you invest money, at least.

You got a possibility.