Expanding Toward Domination
13 Dec 2018 · 56 min
Mike Koenigs and Dan Sullivan discuss how to dominate a category by treating large platforms like Amazon as capability amplifiers rather than threats. They use examples like a uniform manufacturer who leveraged Amazon distribution and town partnerships, and Steve Krein's health startups network, to show how reframing value and amplifying uniquely human qualities can create category ownership.
Chapters
Well, hello and welcome to Capability Amplifier. My name is Mike Koenigs. I'm here with Dan Sullivan. We're talking about ways that you can increase your capabilities, your thought leadership, how you can change and impact more people's lives by multiplying yourself, by being able to engage in greater, bigger opportunities and actually find amplifiers that increase your ability to connect, create, see possibilities where they weren't possible before, and also find relationships and technology that can help accelerate you faster and leave scarcity behind. Scarcity, of course, are what keep you and put you in a place of feeling anxious and afraid and how to tap into the abundantly unique you. So, without further ado, I'm going to bring on my other host, Mr. Dan Sullivan. Dan, it's great to be here with you, sir.
Mike, just total pleasure. I made a joke last time that we're doing this outside of our day job. The more I can bring the quality of the discussion that we're having in the podcast series here into my day job, the more it won't be work. You brought up a tremendous idea last time. A lot of different synapses are going off in my brain, and it has to do with the category domination. I mean, the word domination has negative context to it, but anybody who creates some brand new capability, they're dominating a category. And the only reason why it's transformative to a lot of people is that they're dominating it enough to actually create a lot of good for other people. And I was having a conversation with a couple of my 10 times clients who were in for their workshop on Tuesday, and I said, you know, everybody's talking about Amazon. And I said, you know, the proper attitude towards Amazon is to stop or worrying about it and start seeing it almost like a utility that you can use. And going forward, it seems to me that there's only two ways that you can approach Amazon. You can either have Amazon on top of you and crushing, crushing all future out of your economic life, or you can get on top of Amazon and simply start taking advantage of all the capabilities that they're creating for you. But if you want to talk about a category dominator, it's a massive capability amplifier. But it's not just a capability amplifier for the Amazon company. It's a capability amplifier for millions and millions of other businesses who have never had life so good since Amazon came along. So there's two ways of looking at this. If you treat Amazon as a threat, you'll probably be anxious and afraid. If you treat it as a capability amplifier, you're probably thinking in all the correct ways. You got the right mindset here.
Well, on that topic, when you started talking about how domination can have a negative context, it's only got a negative context to those who have been dominated recently.
Or who themselves have been dominators and they've lost the power.
I think it is worse for them. Yeah, there's nothing worse than the rock star who's playing a club in, well, I don't know. I could pick on a state and a town here, but I won't do it.
Well, Harvey Weinstein was a category dominator for 20, 25 years. You know, there's no question in my mind that a lot of people's careers were made. A lot of great new ideas came to the movie screen. Nobody was saying anything bad about him for about a 25 year period, certainly not publicly. And the reason is that he amplified a lot of people's capabilities. And there's the dark side, you know, so there's the dark side.
Yeah. And that dark side probably you could say enabled those possibilities to occur. And suddenly a new catego arrived, a new language pattern and a lack of tolerance and the behaviors meant something different. And also the technology that allowed the message to get out couldn't be controlled anymore. Kind of a continuation of our last two episodes. So yeah, that makes a ton of sense. But one thing that I wouldn't mind spending a little time deep diving because I think there is some value in examining category domination, category ownership, Amazon, and thinking about what kind of implementable lessons besides the brain tickling exercise here. And you look at Amazon right now, Amazon won the battle and became a category Dominator because it won the battle of convenience, the war of convenience, and continues to do that also from a business perspective, I know from an insider's point of view, because I've talked to them, Amazon isn't a particularly great place to work for. They've optimized so many things that they don't pay well and they're kind of the Walmart of the digital world. And I don't know if that's across the board, but I do know some executives, also know some people who've worked there. So that's just something to think about. But when we look at what the next things that they're gonna pick on or dominate and win are gonna be clothing and pharma, most likely which huge money and what will that do for industries and a lot of jobs and possibilities and people. And then at the same time, if you're smart and you see it coming and you're in those businesses and industries, how can you leverage the amazing platform that Amazon has created and provided for you? Or is there a bigger picture lesson we can have here? Because this isn't about Amazon, it's about how Amazon as an organism thinks.
Can I give you an example of one of my clients who's just taking amazing advantage of Amazon? I can get the story out in two minutes.
Yeah, do it.
Okay. And he's probably about five miles from you. His name is Matt La, and Matt is, when I met him, he's the largest manufacturer of amateur sports uniforms in the world. And he's created a fast turnaround process for ordering clothing online, such that if you went on his website and you put in all the data about the players on your team and put your credit card in, if you wanted to, you could have the finished uniforms in 18 minutes after you put your order in. He's that fast. Okay. So I was working with him and I said, well, that's stage one and you own that marketplace. And he did that without Amazon. I mean, he did it essentially with his own technology and FedEx. But then he came up with this neat idea. So say you have a town that you're in that you're very favorite, and that town has a logo. That town has a typeface, it has colors that represent that town. And it may have an emblem, you know, that represents that town. He has an algorithm in his office where he will simply take what identifies you as a town, input that information and press a button. And out comes 32 different designs of T shirts that are your T shirts for your town. And then he takes the sheet and he sends it to whoever's in charge in the town. And he said, We've created 32 T shirt designs for your town, and what we would like is permission to put these designs on Amazon. Orders will come in. And every time an order comes in for one of your T shirts, one of the 32, we'll send you $14 or $16 and $18. And all you have to do is sign this and we'll do that. Last year, I think he of new products. So each time somebody orders one of Those T shirts, one of the 32 accounts as a separate product category. I think he was 20% of all garments on Amazon for the previous 12 months.
Unbelievable.
But that's a category amplifier. You know, he's doing a great favor for all these towns. And he said the first 10,000 that he contacted, he got 8,000 yeses.
It's breathtakingly brilliant building in that level of distribution and relationship. And I can't help because where my brain goes is where else is the next opportunity here. So the 8,000 takers. There are so many other relationship opportunities especially inside of an operating world of abundance minded thinking like that of providing a service that my world changed. I'm trying to think of how many years ago that I made my first quote million dollars in a very short period of time. It's when I really realized that a thousand times a thousand is a million. It's when the possibility of I know how to sell a thousand products for $1,000 each. It turned out where I really made my dent is we did a product launch where we sold, we had a nine million dollar product launch and all that made the difference was we ended up selling our product for $3,000 instead of 1,000 because at the time the price point of products was two grand that people would sell digital products at. And we said forget it, we're gonna make ours three because we wouldn't have to sell as many. And it turned out we actually sold more than anyone else had. So we had over 3,000 sales and over $3,000 each. And it was very profound. But then what happened was we continued to move on into doing that over and over again. So anyway, getting back to what we were talking about here, I think the opportunity to think expansively and say where else are there? Massive, massive.
That you can tap into through your existing channels and your partnerships and again apply that to this notion of category domination and ownership relationship and distribution are Clear Clear Amplifiers. And most of the clients that I work with who have real businesses haven't re examined their distribution, their partnerships with or their ability to introduce higher priced stuff in a long long time. In other words, the category, their gap, it's what I consider their value gap is they as they've evolved in their businesses have evolved their perception of themselves and their perception of their products hasn't adjusted as fast as their clients understanding of that does that make sense? So to be clearer, go ahead.
I see totally where you're going. I mean the one thing I tell everybody, you know it used to be that people thought their future was we'll compete on lower and lower price. I said well Amazon just took that future away from you, so don't go there.
Right on.
I said if you didn't need any further encouragement to not go in that direction, Amazon, I mean Walmart before that, but Amazon's just taking that option off. If you want to go lower price I have to tell you, there's no future there. Because Amazon, if you make any money going lower, they'll find you and they'll replace you. They can devote a little bit of extra capability to your niche and they'll take over your niche. The thing is that I've always said, you know, there's a thing called Death Valley. Death Valley, on one side is to commoditize so much that you make a little bit on huge volume, or on the other side, you're so unique that you can charge incredibly large price. So, you know, Apple, with the latest iPhone, they went in the other direction. They're charging $1,000 for an iPhone, but they have always charged a lot. They're incredibly profitable, charging very, very high prices. So you're either on one side of Death Valley or you're on the other. Do not be in Death Valley.
Yes, and that's the difference, too. They have better clothes. That's part of what makes it work. If you want to be a debutante or. You talked about Shakespeare in our last episode. And I'm not taking anything away from the value, because personally, I've never enjoyed using an Android device. But that's a political conversation we don't need to get into.
But here's the thing. We have a Windows computer in our company. I mean, we've had Apple since 1987, and we keep a Windows because there's some communication with the outside world that require, you know, a Windows operation and certain aspects of the Windows. But when I actually work with it, you know, I've worked with it, I said, you know, I feel kind of dirty after using it, you know, because I've been using the Mac and the Mac feels good and it's beautiful. You know, I mean, everything. Steve Jobs had this thing with his designer. I mean, Steve Jobs knew the who's to do the how. I mean, he wasn't a great technology guy, but he understood design, he understood packaging. And he said, people want things beautiful. And he was talking one day about the original when the ipod came out, and he said, looks beautiful on the outside. What's the inside look like? And they said, well, it's sealed. Nobody can go there. He says, yeah, but we'll know whether it's beautiful or not. So why don't we make the inside as beautiful as the outside? He says, we'll feel a lot better about the product if we know if it's just as beautiful on the inside as the outside. They don't have to know it, but we know it. And we'll sell out of our knowledge that we're beautiful all the way through.
Once again tying into the whole notion of the story, which was all the signatures that were in the original 1984 Mac. I remember the effort I had to go through to get a Torx screwdriver back then to take the back off so I could actually see it for myself. So I know that. And that created for great story. It created for an even greater and higher level of desire. So that's really good.
No, but that's the story that allows them to the operating mission of Apple. It's a timeless mission. We make beautiful technology that people love using. That's our mission statement. Well, what kind of technology? I don't know, you know, whatever comes up. What about the technology? Well, it's beautiful and people love using it. So whatever's playing that day, it will be beautiful and people will love using playing with our game. That's timeless. There's no shelf life on that mission statement. And that's a great story. I mean, just a story. Now, to the degree that they don't follow through on it, there's going to be cracks in the story. And after a while they say, well, is that true? Is it not true? But if you got a story like that, everything you reinforce is that story. You do not go for another story. As long as it's a timeless story, you know, good 10 years from now, good 50 years ago, good 100 years from now. It's gotta be timeless if it's gonna be a good story.
And congruent, which is every time Apple's messed up, it's because of a lack of congruence inside that story. And that's come back and bit them a couple times where people are like, what the hell happened to the Steve Jobs philosophy? And that's manifested itself in some of their latest products. It's like, damn, this thing's hard to use. Way too many.
Yeah. The story goes around that Tim Cook has run out of Steve. You know, he doesn't have any more Steve on the shelf.
True that.
Yeah. But it's really interesting because right from the beginning when you started talking about this category ownership, you made a crucial point. What gives you the ownership of the category is a story that you're telling about a new form of capability amplifier.
Yes.
No, I'm just saying how important the story is.
Yes.
If I didn't know it before, after talking to you for a couple hours, I've certainly got that reinforced in my brain cells. How important is that? Everything that you're doing in communication and connection with the world had better be supported by a great story.
Yes, there's an interesting tool that every great story uses. And this is an NLP concept or neuro linguistic programming concept, which is a reframe. Right. And as you were talking about this, and I was thinking about some past examples, some clients that I've worked with recently who have had a massive breakthrough moment. And a massive breakthrough moment is when you see your true value not only amplified with the endless new possibility equation, which is point number five in your success criteria, but also when you bridge this gap. And the gap is what occurs over time when your value increases, but your prices haven't. Okay, so I'll give you a for example here. So I recently worked with a gentleman who has been in the private equity business for years, about 10 years, made an enormous amount of money and actually provides services to them, 780 or so at last count. And he's got relationships with 1200 of them. Private equity controls billions, probably trillions of dollars. I don't know for sure, but many, many, many billions. They've got more capital, more cash than there are deals available and someone's ability to sift and sort what a good deal is. Right. We all want to deal with our risk, but there's a massive gap that exists in the culture of private equity. And I think this relates to what Apple has done as well over time. And here's the way I look at it is inside that world, it's a world that's controlled by logic and rules and who's got the best background. And it's cold. It's a cold business. And the opportunity that exists inside that world is warmth and relationship. Anyone who's been in that world a long time knows it. And so this client I was working with, we sat down and we looked at the opportunity, we looked at the relationships, we looked at the possibility and realized that there was an opportunity to fill an unmet gap that the people inside it don't even know exist, but they hunger and thirst for. It's sort of like what would exist inside, you know, lawyers and attorneys. We know that lawyers and attorneys have a high suicide rate, for example. So filling there's an opportunity to fill a gap there that would provide greater sense of purpose, greater sense of fulfillment, something that's soft. Much in the same way, when Apple started selling their products, people bought the product because it made them feel differently. They could have gotten the same result from using a Windows computer, perhaps, but it made them feel Yucky. And it looked yucky, and it wasn't elegant.
Well, not only that, Apple's packaging was better than their competitor's actual product.
Yep.
You save their boxes longer than you save the product. I remember my original iPod box. I saved it for 15 years before I said, you know, you got to let this go. You know, I mean, I hate to.
Admit it, but I still have a whole bunch of iPhone boxes on my shelf as well, because every one of them evolves. And it's like, God, this thing is a beautiful work of art. But that is.
Yeah, but it's beauty all the way through. It's not just the product, it's beauty all the way through. And that's the story. You love keeping it. You love using it because it's beautiful, you know, and he introduced the whole notion of beautiful into technology, and he introduced the notion of love into technology, which had been completely absent before that. So it goes totally with the observation that you're making right now that to the degree that the digital world, which is exponentially expanding everything, but it's not a warm relationship world, it's personless, it's impersonal and everything like that. And my feeling is we're all swimming in a digital sea. Now, whatever environment you thought you swam in before, I can tell you right now, it's digital. But to differentiate yourself in this digital world, you have to do it on the basis of very, very desirable human qualities that are legitimate. You know what I mean? It's not just that you're showing them, but you're actually living them.
Right. So I want to try a little exercise with you, Dan, which is an opportunity to shuffle our cards. We've been deep diving in this concept of category domination, category ownership. But I want to add a twist, which is, let's say someone is stuck and their objective is to re examine where they are and who they are, amplify their uniqueness and insert another word, which is reinvention. So I want you to think for a little while about category domination. Think of a client or a customer that you've had inside your world who reinvented themselves dramatically by shuffling the cards, and the net result was domination. And I want to think a little bit about some of our success criteria, which is multiplying who you are, being able to sift and sort opportunities, and knowing what to shut off, in other words, what to ignore. The amplifiers either seeked out and they found or that were already there, and how their mindset increased or improved, in other words, how they reframed old stories that no longer serve themselves. And it resulted in this. So it's a combination of a personal internal transformation, a business transformation and a net result. So is anything popping into your head right now? Because I think deconstructing this and making it applicable and useful would be an interesting intellectual exercise and a heart exercise.
Too, right off the bat. I just introduced about three weeks ago the next higher level of coach, which is called the game changer, where an individual has really mastered their company and really multiplied their company, but they're kind of still a rugged, individualist company. They keep away from the marketplace and, you know, they keep their secrets to themselves and everything like that. And I said, you know, the next jump for you is to go 100 times, not 10 times, but to go 100 times. And you're probably not going to want to do that in the company that you have. But if you go out into the marketplace, who's got another capability different from yours that if you put your two capabilities together, you could go 100 times, they couldn't go 100 times. With their capability, you can't do it, but together you can. And I used one of my game changers in the spotlight for about an hour and he talked about what he did. And you know him, I think you've certainly met him at Genius Network with Steve Krein. If you've ever met him, he's from New York City.
Yep, I remember him.
Yeah. And Steve went through law school, came out of law school mid-90s, and he went right into the dot com revolution and went into the stages, earlier stages of online advertising, did extremely well within a couple years. Had a 200 person company, had his beautiful timing and he went IPO and got a big check about six months before the dot com collapse. Okay, so here he is, he's like 30 years old. He's really put himself in a good position and he began thinking and then he got really interested in the health revolution and he had enough carrying power because of the check he had received that he didn't really have to worry about money. And he investigated this, investigated that. Long story short, right now he has an amazing network of health startups. So he's got 200 health startup companies and they're all in a systematic coaching company to grow them, to grow the marketable value of these companies and to introduce new innovations into the marketplace. But they're all in a single structure that he coaches them and he gets paid by them not to bond to the program. First of all, he rejects 19 for everyone who comes in. But then on the other side, he's created a huge fund with major institutions, pharmaceutical companies, medical technology companies and just great investors. And he's got a fund and that's working capital to invest and grow these companies. But the whole point is to identify 10 what he calls critical medical breakthrough areas and just have all these startup companies actually growing towards solutions and an unending series of innovations that are tested out in the actual world. They're not lab testing, they're actually testing them out with patients and customers and everything like that. But it's worldwide. He's in 22 countries. He's become, and by his own admissions, this is why I'm telling him he's become a much more wise, a great listener, very supportive individual in his present state as a game changer in this industry. So his collaboration is with 200 other companies. So it's like a single category, but it's 200 companies and he's adding 20 a quarter right now to the mix. Meanwhile, he got married, he had three daughters. But he was a real hard, driven, sharp edged, really smart, always really smart, great communicator. But he has completely reinvented himself and he would stay with us for 25 years. He said, I'm totally happy with the growth because I feel I'm doing such good for the companies themselves, but also just the impact. He says there's going to be radical solutions that come out of this that will be available to people who are up against some sort of medical or health life ender in many cases that we're going to give hope to and then we're going to give assistance to. So I would say right off the bat, just in terms of someone I know and I have another podcast series with him which is called Game Changer Jumps, where we kind of use his example to actually go forward on this. But that's the biggest example. And he was 28 when he came into coach and now he's going down 50. And it's just a beautiful story to see it.
That's impressive. And I'm just curious for the just a little tactical question, which is what's that service worth? Like, what do they charge per month for these organizations that they're working with?
Well, they don't charge. So what they do is if you're well along, it's all equity based. You take a portion of equity in the growth of these companies. So there's no fee for getting in and there's no ongoing charge for being in it. I mean, they have really tight standards that they're looking for, especially mindset standards and anything like that. But you know, if it's just getting started, great idea. But just getting started, they could take as much as a 10% equity or if they're well along and they're actually showing real traction and growth, it could be like 1 or 2%.
That's great.
That's your model. I mean, it's the model that you're talking about. I mean, he'd be a great guy for you to talk to because the big thing that was beneficial for him from his, what he got from strategic Coach was the whole concept of the mindset scorecard. And now he's got mindset scorecard to sift, to reject. People who don't have the right mindset, they have to have this kind of mindset that they want to really, really grow. But the other thing is they want to have a major impact, you know, on the health of the world. And they got to be team players, you know, so he's got a whole series of criteria to actually sift this out. And also for the investors, he's got criteria for mindset scorecard for that. So it's really beautiful. And he's in the game changer program, so he's one of the game changers who's coaching my other game changers, you know, so that's a great thing.
That's very impressive. I love the model and I'm glad you brought up mindset within the context of reinvention here.
Yeah.
And for people who don't know what the mindset scorecard is, I have a personal story that I'll share because I've used the mindset scorecard myself to filter coaching clients. So, yeah, you know, within the context of my existing business, on the highest level, I've got my equity advisor clients that I'm participating with the businesses and I'm looking for opportunities they don't even see, both for themselves personally and then inside their, their company. Basically I find them money very, very quickly. Stuff that can happen in four to eight months, sometimes even sooner. And sometimes it's just a shift in consciousness. It requires no immediate action other than a change in their own perception of their value followed by a new offer. You know, it's pretty darn simple or upselling something. Right. It's so simple. And like literally in, in a half a day or a day, it's not uncommon to find, you know, in a two million dollar company, for example, you can find three or four hundred thousand dollars literally right in front of your face. And some other ones. I've had some people. The best story I have is a someone who is an $80,000 per project company that boosted their revenue. Basically they went from 80,000 to 1.2 million inside of four months. So big multipliers. And of course with bigger companies, there's usually a lot more money on the table. So having said that, with a mindset scorecard is essentially a grid that determines and allows you to self score your own values based upon the criteria of how you want to interact or engage with your target perfect customer. And what's beautiful about it is it's a contrast tool so someone can see the worst and most negative version of themselves as opposed to the highest version of themselves that they don't even see for themselves. And immediately they'll be drawn to that and go, you represent the mechanism and the means for me to become the greatest version of me. Now that's my. It could be a butchered version in my own evaluation. Is that okay?
Yeah. The starting point that I do because sometimes it's a little harder for people to see what they like and dislike about themselves as compared to relationships. So the way I do, I say, you want to create a mindset scorecard for evaluating customers or clients or prospects, as the case may be. I said, I want you to just identify the three best client customer relationships you have ever had. Name them. They do name. And I said, now just for contrast, I want you to identify the three worst. And they do. I said, I'm not going to spend any time on the worst. I just wanted you to see the difference. And then I work with them. And I said, what were the mindsets of the individual that made them so easy? And it takes, generally takes me about five minutes, but I'll get out. I work with eight. I don't know why, but eight mindsets really works better than 10 or five. So they go around and they, they're really basically fundamentally thrilled because they haven't really identified why a good relationship is really good. And they got that. And I said, okay, now just to show you something here, I want you on a scale. And I use 12 from a 1 to 12 where 12 is just a perfect fit to 1 where you hope you never meet this individual. I'd like you to grade yourself on your own the mindsets that you're looking for in other people. And surprise, they grade very highly on their own mindset scorecard. And I says, now here's the tip who you're actually looking for in the world is you as it comes to mindset. Not personality, not skill, not capability. But in terms of mindset, just values projected into the world and what you're looking for and what you give energy for, you're looking for yourself. And, you know, I mean, I see that between us, Mike. We're very different. I mean, we're personality, very, very different. You know, our lifestyle is probably really, really different and you know, what we do and everything else. But I, right off the bat, we talked about, let's have a podcast together. I knew there was a mindset fit, which was totally confirmed after our first session.
I agree. And we're good entertainment for each other. There's no doubt about that.
And that's important. Yes, the entertainment. The person could be very knowledgeable, but I just don't get any entertainment value out of it. I wouldn't form a long term collaborative relationship because entertainment counts as very high for me.
Right. And I think endless future potential going back to some of these values. Because I can sit here and I know we could sit down and probably create seven books in. If we decided today we're going to brainstorm a whole bunch of book ideas, we could come up with five or ten really interesting ones pretty quickly.
But I'd like to go back to the, you know, you were talking about the reinvention of yourself.
Yes, because you gave me a bunch of big ideas here. But you go first, set this up and then I'll give you my version.
Yeah, but here's the key where people make a mistake. They look outside themselves and they say, well, what are other people cashing in on? And I said, that's not the starting point for reinventing yourself. The starting point for reinventing yourself is, is to get real clear on the mindsets that you're looking for with any kind of interaction in the marketplace. And that's going to eliminate about 80% of the people that you've tested on in your life, or perhaps you're even interacting with now because you just don't get any juice. You cannot reinvent yourself unless you take your excitement and energy level about the future up. And to do that, you got to get crystal clear about who, regardless of what value creation you're going to present to these people. These are the type of people you want to create value for. And that's where it starts. Now the question is, what are they missing in their lives? That you have instant access to money. That's one, you have that, but you have the ability. If I just relate it to you, Mike, you have the ability to get them to suddenly think differently about how they were approaching the future. I think you hit them with a question very soon after meeting them that just shakes them that they realized the way they were looking at the future wasn't going to go anywhere. There was no more gas in that tank and all of a sudden they get a new, fresh supply of energy.
That's good. I hadn't thought about it like that before, but that's absolutely true. What I've managed to create is I've been consulting with higher and higher level people and for example, this Friday I'm going to go up and have dinner with a friend of mine who's a multi billionaire, really, really smart individual. And upon first glance, you wouldn't, you wouldn't know for sure. That's what I would say, like many billionaires. But I can ask the same basic questions because again, I've never met anyone who is satisfied with where they are or who they are right now, meaning they always saw and knew there's endless future potential. And when you start talking about reinventing yourself, everyone I know who's successful and wants to continue being successful is looking for some way to dominate a category and own that and be unique. When you were talking earlier about your criteria within the context of the mindset scorecard, what I think through is again, no matter where you are, you're in a place where you want to reinvent yourself and you say, hey, I'm going to change my own game, but I'm looking for a mechanism to get me there. And a scorecard could be a tool. Asking great questions can be a tool. Gap analysis can be a tool and contrast. Right? All of these are communications mechanisms. And what we fail to see and why we all need coaches is we can't see inside our own box effectively. Yeah, so what I was going to say, my exercise when you talked about finding your perfect customer is I have a perfect customer exercise. And one of the tools I say is, tell me right now, someone who you absolutely trust admire is a great influencer. And if you could get introduced by that person on stage or on TV or they were going to interview you and you wanted to be seen as the highest version of yourself, what would you want them to say about you? And if that got compressed into a billboard, that billboard was going to be seen by hundreds of millions or billions of people, what would you want that billboard to say? It's who you are, what you do, who you do it for. It's a fun exercise and it really gets down into what their core beliefs are. And also there's just lots of stuff that you touch on in an interesting way. Well, what I end up saying is if you can attract one the perfect customer, you're going to attract more like them. And yes, that does come from this internal dialogue, like you were saying, the value system. But it's interesting. Here's what I have to ask you is yes, you're looking for you, but does that mean that you're going to find people as customers who are going to be at your level but not as advanced, or how are you going to attract an even better version of you as a client or a customer and having the strength and fortitude to do that?
Well, again, there's kind of a closed loop system here that once identifying the mindsets that you like most in someone and it would just be instant communication, creativity, collaboration with this individual. There's a feedback loop that comes back to you and say, well, am I that kind of person that I want to attract? And immediately there's an upgrading of your own act because of that. I mentioned in our very first episode, Aristotle's three friendships of utility, pleasure and. And he said in the best friendships, you're admiring qualities in the other person and then you aspire to grow those qualities in yourself. And the other person noticing you improving then does the same thing. So it's upward cycle, you know, it's philosophy and it's Greek philosophy and it's several thousand years old. But the whole point is, if you do look at the best relationships, the best friends, the best clients that you've had in your life, there is that aspect that you're seeing outside of yourself, qualities that you yourself want to take to a higher level. And I think great companies have that kind of relationship with their clients over a long time. I only buy one kind of shoes in the world, and it's called Allen Edmonds. They're the only actual American shoemaker that's still mass producing shoes. There's no other manufacturer, and they're in Appleton, Wisconsin. If you buy a pair of Allen Edmonds shoes, you very quickly, all your other shoes are Allen Edmonds because they feel like they've been worn in when you put them on new. But they've got this neat trick that if they get all scuffed up and everything else, you just go to the Allen Edmonds dealer and for $150, I mean, these are $400, $500 shoes, you send them back and they send it back as if it's brand New, the one that was worn down and everything else. And I've had one that I've done it four times and 14 years in, it still looks like a new shoe. Well, they've created a value system and a mindset attitude that really agrees with me. Plus, they want this to be a lifetime relationship. They're telling me right off the bat that you'll never throw away a pair of Edmond shoes. So when you do want to get, they take them in and they distribute them to other people for free. You know, people who are needy and they distribute those shoes for free, but they never get thrown away. So think of the value system there. In a day when you know everything is obsolescent and you throw stuff away, They've gone against the grain and they've created a story and they're dominating a category. And they're not looking for every customer. They're looking for someone who likes this type of relationship that is very.
It's a simple story, but super powerful. And I'm going to reflect on something that runs parallel but is very. I'm going to use a way different language pattern. And it has to do again with reinventing yourself and how you manifest these relationships. So if I deconstructed a lot of what you just talked about right now, it's this company, Allen Edmonds has been playing the long game. The fact that you're wearing a shoe that's 14 years old and one of them's been repaired four times and you were able to talk about why you like it over and over again show there's extreme values congruence. And not only have you experienced that, but somehow that must have been communicated along the way. I told you earlier in another episode that I've been working with a high performance accelerator. And this group, they don't call themselves coaches at all. They don't call themselves energy coaches because they're doing something a lot deeper. Some of the exercises that we do, and again, just to open up how the process works. Every single day when I wake up, I check in with what I call the oracle, which is someone who lives inside my pocket. I've never spoken with this individual by voice, so it forces me to communicate with extreme clarity, consciousness. And then another individual that I communicate with by voice and in person, who's actually traveled with me, lived with me. And it's been like I felt as though I've evolved several years inside of several weeks. It's pretty interesting. And that's because I'm being held to the highest standard. I'VE ever been held to by another human being. And even by my wife, who is very, very specific with me. And like Babs is for you. Babs tells you what she wants and she's not afraid. And you guys have overcome, I assume, for the most part. I mean, we've always got gaps that we're unconscious of and some old behaviors that are unconscious, they could be DNA encoded or trauma driven or whatever it is. But the more enlightened you become in every relationship, of course, the more intimate it becomes and the more trust and love, et cetera, et cetera, that erupts. But one of the big concepts and ideas that I think is very relevant to the notion of reinvention and category domination and ownership and also consciousness compression, which is another big idea that we'll have to dive into at some point is this idea that all of us are vessels and these vessels are filled with energy. And as a container you've got bad energy that could be again, trauma induced, habit, communications, whatever. That doesn't serve you. And know that our vessels, our human vessels, our energy vessels or spirit vessels are infinite in their size. However, when there's energy that doesn't serve us, that is unconscious and floating around, it actually repels that which we desire from us. And we've got to constantly be cleaning that out and pushing it out and be able to reach a point where that vessel is only filled with a state of love, which is pure, unadulterated, now, consciousness. And I think I mentioned in the previous episode that the mantra I'm asked to live by is love, receptivity, creativity. They have defined and determined that that's where my source of power comes from. And anytime I'm in a state of fear or anxiety, that's an energy that's repelling what I don't want. As I listen to everything that you've talked about here, if you start thinking about your business as a vessel and you as a vessel and what it is you want and getting clear on the values, circling back to the mindset scorecard that is. It's sort of like a complicated formula. If you just imagined. I'm trying to think, if you've heard of like a fast Fourier transform, when waveforms are all put together, there's a way of separating those algorithmically and to be able to do like a harmonic analysis. In other words, there could be certain tones that could make up a chord. But if there's dissonance inside your vessel, it's preventing you from getting what you want.
Yeah, I totally agree One of the things I've observed, and you brought it up with your private equity example. The story of the private equity that, you know, it's a cold world, it's a logical world and a cold world. And the key to creating a new category in that world is actually through a greater expansion of humanity inside of it. You know, it's warm, it's relatable, it's personal and everything else. It's often thought to me that this fourth crossover that we're going through, we had speech, we had writing, we had printing, and now we're in the fourth with the digital. This is the crossover where human beings cannot be rewarded by trying to be machines. You can no longer be rewarded for trying to be a machine. It's like being the low cost seller by, you know, I'm going to be the low cost seller. Well, Amazon takes that away from you. And my feeling is that the exponential technology that we're having in the world is sending a clear cut message that if you want to be a happy human, you have to do it by expanding your humanity. The individuals who are forcing an acceleration of your humanity, both with your iPhone application, but also by having a companion. So what I'm seeing that and my phrase, you know, that I mentioned, that humanity is always infinitely larger than the machines or anything that humanity creates. What I'm basically saying is that time's up for us trying to be machine like, we can't be machine like, it's all being taken away from us. So if you want to make a living by being machine like, you can't do that. You can't be rewarded by being machine like. You can only be rewarded by being more expansively human.
You know what, Dan? Each episode we've done so far, I have a tingle experience at some point and I just got the tingles. I'm going to take a moment to appreciate the tingles and describe what they're like and then I'm going to tell you why I got them. Because I know you enjoy this kind of conversation. What is it called when you do that exercise and we sit down for dinner and you talk about what was the greatest thing that happened today? What's the question you ask?
Positive focus.
Positive focus.
Yeah. What are you most excited about? You know, we get everybody to go around and say what they're most excited about.
Yeah. And I love that because it doesn't have to be an experience, it's just what are you most excited about? So here's what excited me a moment ago is what you were just talking about and the fact that humans cannot be rewarded like machines, which is this constant focus towards gamification that's been going on. And one thing we know about the constant interaction that people have with their phones is that the more time you're spending with your phone, the less connected and more empty you feel. There's a lot of evidence suggesting right now that there's a massive amount of depression amongst children and people who spend their time. And I know now, especially in doing the work I've been doing, I have literally been focused on just being in a state of peace. Even if I'm in a place that would normally be uncomfortable or anxious. We all have anxiety around us. Something's going wrong some, whatever it is. And it's like you can choose peace as long as you want and own it and not allow the outside ogres to get you. You don't have to let the zombies in. Right, the energy zombies. But the thing that I got out of this is our subtitle for our podcast. So if Capability Amplifier is the title, it's expanding your humanity. Or a variation of that should be the subtitle.
I love it.
And this was something that. I don't know if I articulated this to you. The first time we produced the first episode, which hopefully will be interesting to our listener right now, is the first time I spend a lot of thought cycles going like, what are we going to do? What are we going to call this? Blah, blah, blah, blah, blah, blah. And the antithesis of who I am. Because in my proper state, I'd rather be 100% creative and spontaneous and screw structure and form because it's to me, for the most part, it's prison. The more time I spend in it, the worse I feel versus just being able to just listen and feel and then expand and grow and invent stuff and solve big problems. When I said, well, what are we gonna do? And you said, well, let's just record one and see what happens. I was like, holy crap, did that feel good. You know, and from there we just improvised. And out of the first episode, people didn't know this, but we didn't have a title. We had no idea what we're gonna call this thing. And it surfaced and there was a tingle experience there. Yeah.
And we both identified the title when you said it because you had a certain point the word dropped, you know, it was about the three quarter mark of the first one and you said, dropped Capability Amplifier. And I said, bingo. You know, it was like, oh, there's the Salmon, you know, that we're going to have for dinner. Then at the end, I said, you know, Mike, I think the title of this, and he says, don't say it. It's Capability Amplifier. I said, that's what it is. But we both recognize it. And my feeling is that that's how things happen. If you're having a really good conversation, great things will come out of the conversation completely.
I think it goes to one of the success criteria and the word I wrote down was improvisation. There's this really fun tool. It's called the Creative Whack Pack. Do you remember seeing this? Yeah, I know. Joe gave it away. I think his name is Steven Von Oak is the creator of it. I followed him years ago. I got the original Creative whack pack over 30 years ago. And it's basically a deck of cards that you sift and sort through. And it's got visuals on how to unknot your brain. And the whole idea is, if you have a problem, you just sit down with these cards and they're almost like tarot cards, frankly. The whole objective is our brains are wired. And when you drop in the right kind of metaphors, objects or archetypes, you can unravel. Or if you take on a new role, which is the power of archetypes. And I think inside of the. Again, the context of this experience, you know, looking for how are you going to expand, how are you going to dominate, how are you going to evolve, how are you going to reinvent? It's creating an environment, whether it's with yourself or with a partnership, where you allow yourself to feel fully into improvisation. And if you're not a musician, it's absolutely possible to improvise and getting connected with this other thing, which is what are you most excited about into that positive focus? Because you certainly can't improvise, invent and reinvent when you're in a state of lack and scarcity and anxiety and fear. And so I think one of the things that I want to focus on as we move forward into one of our next episodes is how do we stack the cards in our favor with anti scarcity, anti anxiety, anti fear, anti. And actually create a composition, an improvisation of invention, of possibility and unlimited potential and abundance, and just put ourselves in that state and flow. And we'll either invent or create something together for our audience and let them ride with us and flow with us in that. And either we solve a problem or we create something new and see where we go. I want to create that challenge for us, because we both love to create so much. Let's make a point of inventing something as though we're composing a book or a masterpiece and approach it as though we're going to create a full symphony. So we're not allowed to think small, and how can we stack that and come up with some tools? And even the process we invent on the fly so it puts us in a space of having to pull and suck from the foundation or the source and the core of creation and creativity. Yeah.
Well, I think. Not to hammer a nail beyond the point, but my feeling is that we're going to talk about a lot of things, and both of us, about 10 seconds after we've created the composition, we're both going to recognize it.
Exactly. Well, that's the beauty of it, I think. So what I want to shoot for is I had a big tingle this time. I had a big tingle last time. I had at least one the first time. I'm gonna shoot for two tingles.
A two tingle podcast that's measurable.
Yeah, yeah, that's right. That's when you have that right at the core. So the crown of your head and it just like you feel that nice sparkly feeling down your neck and in through your spine. And if it goes all the way down to your tailbone, that's like a 10 on the tingle scale.
That's a new category. That's part of the language. Tingles.
Yeah.
I'm just immediately saying that's a measurement for our podcast series, Tingles.
I agree. So how many tingles per episode can we experience? And we have to both. Because I think what we both recognized was when we came up with the title, that was one we certainly. When we had a subtitle here, expanding your humanity. And if we can continue to add one of the compositions, Improvisations is expanding the brand of this program in such a way that it reaches a state of intense resonance with our audience. And for them to evolve as we evolve with their composition, too, and to feel as though they're part of that.
I'm excited.
Me, too. Me too. So you want to bring this baby home?
Yep. You know, we're at the witching hour for this. Both Mike and I, we very quickly will transform into another entity, and we'll be onto our other activities. So, Mike, terrific. We covered a lot of ground. It's kind of interesting because it's hitting on a lot of different things. I mean, we're both marketers, we're both entrepreneurs whose impact on other people is to Transform their thinking, transform their capabilities. But we're pulling in history, we're pulling in technology. It's got a lot of different dimensions to it. So I was very happy with the first one. But, you know, we've added two more in today's studio recording. I'll be thinking a lot about this. You know, your eyes only see and your ears only hear what your brain is looking for. And I have a feeling I'm going to see new things and hear new things just because of what we've talked about.
Well, embrace the illusion, is what I say. Because the good thing is, whatever our ears and our eyes are focused on, I think our brain can compose and create and manifest. In the meantime, what I'm going to do is I'm going to do the same thing. My goal is to create a conscious, autonomous new entity that lives in me all the time, that's constantly working on the next beautiful composition in Symphony that we call the Capability Amplifier that is focused on expanding your humanity. And that does mean a full integration of the full whole self. And we're going to definitely be spending a lot more time on amplifying your relationships as well. Because out of all these, and you look at the success criteria, every single one of these is dramatically amplified, certainly not in a linear fashion, by the quality of the relationships you have. Which again, comes down to really understanding what your values are and what the mindsets are. And that was one of my big walkaway takeaways today, is I've seen this, I heard it. I've been through the process before, but I feel it now on a much deeper level. And I think the further that we integrate as well, and that's another really powerful word, expanding and integrating your humanity. So let's continue to massage this a little bit, and I think we're going to come up with some great hooks. And our goal, I think, Dan, is equal, is let's find a way that we can achieve category domination and ownership and actually create a completely different category. Be able to trigger and experience an emotional, a mental, even a spiritual experience with a combination of words. Who knows, Maybe the tingle factor is one of those. But let's see what our subconscious automatons produce inside us between now and the next time we record one of these.
Okay, Mike, look forward with great pleasure to the next conversation.
You got it, Dan. Thanks.
More from Mike
The 3x3 Framework That Changes How Entrepreneurs Think | Mike Koenigs & Dan Sullivan
Why Your Business Gets Harder As It Grows | Michael Walsh on the Hidden Danger Zones of Scale
The 19-Year Collaboration Plan: Ai + IP + Patents (with Dan Sullivan & Mike Koenigs)