Jeff Hoffman Transcript
Clint Betts
Jeff, thank you so much for coming on the show. What an honor to have you on. You've got the show going public, this new TV series that you're the Executive Producer on, you also star in. Maybe we start there. Tell us about how you got into that.
Jeff Hoffman
Yeah, so the whole idea was to democratize investing. And the idea actually came from two investment bankers, Darren Marble and Todd Goldberg, who had this idea that... If you watch a show like Shark Tank, it's the rich getting richer, right? Mark Cuban, Kevin O'Leary, these people that already have a lot of money get to invest in companies and hopefully make more. So the concept was, let's do a Shark Tank like show, but let's let the TV viewer be the investor.
If you like the company that's on TV, you can invest $100, $1000, whatever you want. But the idea was to democratize it. And we teach the principles of investing in case you've never invested before, on the show. So besides Executive Producing, my other role is one of the mentors.
We don't have sharks, we have mentors. And the mentors are teaching the companies how to grow. So the other benefit of watching, besides the investing side, is you'll hear people like me explaining what it takes to grow a company. We're hoping those companies will grow big enough to go public. So that's the concept.
Clint Betts
And once they're on, they appear there and the public gets to invest. How does that happen? Is there a platform that they invest on? How does it work there?
Jeff Hoffman
Yup, there is. The company who created this, Crush Capital, created something called Click-to-Invest. They even trademarked Click-to-Invest. And so you literally just go to the goingpublic.com website and you click on that company and it's literally click to invest. It'll come up and ask you how much you want to invest and in which company, and it'll take care of the whole transaction for you.
Clint Betts
Yeah, I like that. That's an interesting idea actually. I've honestly never watched an episode of Shark Tank. Obviously I've seen clips and stuff, but I never really understood why I should care.
Jeff Hoffman
Well, to be clear, because I don't really watch it either, but they do say at the end this show is for entertainment. So you will learn nothing about how to build or grow a business. The company's on their five minutes and they walk away with money. What happened? Did they go buy a BMW and then close the company? Who knows?
So they don't teach you how to start a company or how to grow it. They just teach you how to convince people to give you money. So it's fun, it's entertaining. The companies, even if they don't get money, get exposure. But if you're a serious entrepreneur trying to build a business, that's not where you're going to learn it.
Clint Betts
And has this premiered, is this out? Where do people tune in?
Jeff Hoffman
Yup. Season one is out and you can get it on a lot of platforms like Apple TV, or Roku, or our partner was Entrepreneur Magazine. It's on entrepreneur.com and season two is being filmed now.
Clint Betts
Okay, that's incredible, man. You're also the Chairman of the Global Entrepreneurship Network. Tell us about that.
Jeff Hoffman
Yeah, that's really where my heart is. So it's a nonprofit, it's based in the US, but we are now working in 200 countries, incredibly. Credit to our amazing team, and we have a really simple mission. Clint, the mission is to teach, help anybody, anywhere, start and scale a business. We fundamentally believe that entrepreneurship is not a job.
It's a skillset and a mindset. And there are people all over the world that need and want to better life, and they're willing to do the work. They just don't know how. All over the world, I get people that will call me from Africa, from Asia, from South America, and say, "Hey, Jeff, I have this great idea. I just don't know what to do next, let alone what to do first."
So the idea of the Global, excuse me, Entrepreneurship Network or GEN, is that we not only teach entrepreneurship in 200 countries, that's why I'm never in this country. I just came back from teaching in the Middle East and I think the next one's in Japan.
But we also provide, we help build the ecosystem around entrepreneurs, which means help them with access to capital and investor networks, help them with talent, help them with registering their business, help them with meeting other entrepreneurs or finding customers. So GENs goal is to do everything we can in 200 countries to make it easy for people with ideas, to make a living from their ideas and take care of themselves.
Clint Betts
It does seem like, in my opinion, and maybe you shared this, maybe you don't, I'd love your take on it. That entrepreneurship is the great democratic tool of our time. We don't all start at the same place. A lot of people have different advantages and all that type of stuff. But at the end of the day, the thing that matters, how great is your product? How great are you at building it? How great are you at building a team? And at the end of the day, that seems to be the thing that wins out.
And it seems like Global Entrepreneurship Network is taking a real bet on that, on that idea that says, "Hey, anybody can do this."
Jeff Hoffman
I absolutely love that you said that because that is the point. I always used to tell people that as an entrepreneur, I'm in the idea business. We're like idea farmers. We plant seeds, we try to water and nourish them, we hope some of them grow to fruition.
But the beauty of being an entrepreneur, being in the idea business is what you just said. A good idea doesn't matter, doesn't care where it came from. If someone loves your product, they don't care if you are White, Black, male, female, Muslim, Christian, old, young, none of those things matter.
Good ideas that make things better for people will always win. So then, just as you said, the great equalizer in a good way is the fact that if you have a great idea and you can execute it, you win. No matter where you started, where you came from. What you need sometimes, which is why we created GEN, is you might need a little help.
But you are correct, your ability to take your idea to fruition and build a company out of it, is on you. And it doesn't matter where you started or where you came from. If you have the ability to launch ideas and build businesses out of them, then you have the ability to design your own future. You can create the reality you want with that skillset, which is why we teach that skillset.
Clint Betts
And so is Global Entrepreneurship Network like surrounding a community around entrepreneurs, helping them maybe find investment, build the right way, that type of stuff? Is that how you'd describe it to—
Jeff Hoffman
Exactly. We've studied the ecosystem around entrepreneurs that have succeeded and not succeeded. And what we've determined over many years, and all over the world, is that entrepreneurs with an ecosystem around them, and that means everything from education, to mentors in their community, to investors in their community, to laws and regulations that make it easy to start a business and not go to jail if you fail to pay back the money, all those kinds of things.
So yes, you are right. We help organize and build the ecosystem that surrounds the entrepreneur, that increases their odds of success.
Clint Betts
And you're also the founding Board Member of The Unreasonable Group. You've raised over $6.6 billion in funding for 289 portfolio companies. And we're talking like this is another worldwide organization. I'm fascinated with the Unreasonable Group, tell us about that.
Jeff Hoffman
So Unreasonable... And by the way, it's named after a famous quote from the Irish playwright, George Bernard Shaw. George Bernard Shaw, I'll paraphrase it in the interest of time, but he said that a reasonable person adapts to the world around them, an unreasonable person expects the whole world to adapt to them. Therefore, all progress is dependent upon the unreasonable. So that's why we formed The Unreasonable Group.
And it's similar to what I just said in GEN, but there's one big difference. We are only supporting, it's all about social entrepreneurship. So we have a fundamental belief in Unreasonable that the world's biggest problems will be solved not by governments or large corporations, but by entrepreneurs.
And so as such, our mission is to find all the entrepreneurs crazy enough to think that they can change the world and go help them do it. So Unreasonable focuses on entrepreneurs and startups that are solving the world's biggest problem.
It's kind of aligned with the United Nations 17 Sustainable Goals. If you have a solution to provide clean drinking water to people that don't have it, to provide food to people that don't have it, to provide education to people that don't get it, off grid energy to people that have no access to electricity. All those kinds of things, if you're out there making the world a better place, Unreasonable wants to help you do that.
And it's similar in that we provide everything from mentoring to investors, to the whole gamut of things that you need as a startup to be successful in solving the world's problems.
Clint Betts
Jeff, how do you do all this stuff? Seems like you're traveling all over the world. You have a number of different organizations that you're supporting. You're an executive producer for a TV show. Where do you find the energy to do all of this? How do you do all this?
Jeff Hoffman
It's funny that you asked that because year after year, my whole life, I keep saying, "Man, I need some sleep. When I get older, I'll sleep." And I'm getting older and it never happens. I know how important sleep is, I'm getting better at it. But when you're excited about something and passionate, the problem is you wake up at four in the morning anyway, and you're laying there thinking about it and you're like, "I might as well just get up because I'm just going to lay here and think about it anyway."
So when you're passionate about what you're doing, it's a lot easier. And for me, people do ask me that a lot. They're like, "Where do you get your energy from?" And the truth is, I get it from these amazing people that I'm blessed enough to work with.
I have a call later today with a female engineer, she's Asian, and she won our entrepreneurship World Cup, our big pitch competition. All over the world, there are babies that don't have access to milk if they don't have a mother there or after mother's milk, they don't have dairy. There's no ranches, or cows, or refrigeration. So all over the world, there's a lot more people that need milk than have it. And she created a way to produce milk with no cows, no cows were born, no cows were milked, no cows were raised. She used basically a stem cell process, using the stem cells of milk, to recreate milk.
And so young kids and babies all over the world will have milk now even if they have no access to dairy or farms because of one young innovator. So I'm working with her now, and we have a call later today. People like that, that's where I get my energy from. I get so excited about the way some of these entrepreneurs are literally out there changing the world. And it's such a blessing to be able to get to work with people like that.
The media, the news covers all the bad stuff, but there's tons of good stuff happening in the world if you go out and look for it, which is exactly what we do.
Clint Betts
And as I understand it, you've worked with the White House, you've worked at the State Department, you've worked at the United Nations talking about entrepreneurship, promoting entrepreneurship, the importance of entrepreneurship.
What has that experience been like? That's not an entrepreneur at all, what we just talked about. Those are governments and it's really slow, and there's all this red tape and bureaucracy. How's that been?
Jeff Hoffman
Yup. So it is funny because my friends are always like, "You did what?" Because I've actually worked with literally presidents, prime ministers, even kings and queens in some countries. And my friends know that I've zero patience and I'm an entrepreneur because I can't stand inefficiency or bureaucracy, but I will tell you why I do it.
The positive trend that's happening is that more and more countries and governments, locally and nationally and internationally, have recognized that startups, small businesses, entrepreneurs, are the key to economic growth. In our country most new jobs are created by startups, by small businesses, not by big corporations. And so they know that they stimulate economies and create jobs.
So more and more they've been reaching out and saying, "We know we need to support entrepreneurs. What can we do to help?" And even though we both know that in many cases they're slow moving and bureaucratic, it's still better to have a seat at the table and have the conversation.
We did this with the Crown Prince and the King in Saudi Arabia last year, and they wound up committing several billion dollars to fund startup money for startups across the Gulf region in their part of the world. I did this years ago with the Prime Minister in Malaysia, and they created a $250 million fund to give to Malaysian entrepreneurs to start their companies with.
I did that once meeting with the President of Peru. So I will go meet with these people if we believe that they are honestly asking, how can they be more supportive of entrepreneurs in their country? And so I do those meetings.
The White House one was because Obama was the first and the last president to create an Office of Entrepreneurship and Innovation. And so I was asked to advise Obama and The White House, at the time, on entrepreneurship. And so again, going to the White House, whether it's talking to the president or the administration, is not my idea of fun. But they were dedicated to supporting entrepreneurship, and they launched programs that helped entrepreneurs.
So as long as that's a possibility, I will always do my duty and I will show up at those meetings.
Clint Betts
You've produced a number of TV shows, what got you involved in media and making series like the one that you're making right now? But you've done all sorts, you've produced musical events even. What's your interest in all of that?
Jeff Hoffman
Yeah, so originally it was two things. Thank you for asking that. One of them was more business oriented and one more personal. The business one was, I was always amazed at Hollywood, we'll just use that broad phrase, but I mean the entertainment industry, industry, music, film, television. Hollywood's ability to market.
And literally, it's funny because the day it really struck me there was a movie coming out, my friends and I were talking about the movie, everybody was for weeks. The weekend it came out, my friends are like, "Let's go Friday night when it opens." So we went and we stood outside in a line forever, excited. So we're wasting our Friday night standing in line going to this movie. We get in the movie and a little while into it, and we spend all that money on tickets and popcorn.
I realized the movie was horrible, and I was like, "Congratulations to some marketing person," because they got me so excited that I spent my Friday night standing in line paying all this money to get to a movie when it opened, for a movie that actually sucked. And I was like, "How do they do that?"
So I got curious if the ultimate marketing machine is entertainment in Hollywood, I want to learn from the best. So when I first went into the business, I took a break from tech because I wanted to be a better marketer, and the entertainment industry's good at it. But there was a second reason.
I live in a very left-brain world because I'm a software engineer and I'm in the tech industry. And I wanted a chance to exercise the right side of my brain. I was like, "I want to be around creative people too, that are not business people or financial people or engineers." Which is where I spent all my time.
So the first entertainment company I started was a music company, and the goal was to not just learn about marketing, but to spend time observing how creative people create so I could learn something from it. So those are the reasons I got into that space.
Clint Betts
What did you learn from it? How do they do that? How did they get you in there that Friday night?
Jeff Hoffman
I learned a lot. So here's probably one of the most valuable lessons. Here's what most of us do. We create a marketing campaign, we launch it, and then we watch people, "How come they're not buying anything? How come they're not clicking?" And we try to figure out why our marketing campaign isn't working.
What I learned in the entertainment business is they don't do it from their conference room out. The way I just described is you're in your conference room, you design your advertising, your marketing, your whole campaign, and then you launch it out into the world. So you're pushing a marketing campaign from your company out into the world.
But what I noticed, what they do is they sit around in a room and they start at the other end. They say, "Okay, who is this customer? Let's really understand who this customer is." Then once they know who the customer that's going to consume their product, listen to the song, go to their movie, watch their show.
Then they talk about what moves that customer, and they discuss what emotional state they want the customer to be in after seeing their commercial or their marketing. Then they talk about the call of action. So let's say it's a TV commercial just for simplicity. I'm going to run a TV commercial. At the end of the commercial, I want this exact person watching it, I want them to have this emotional response to my commercial, and I want them to take this action as soon as it's done.
That's what they do, and they design it from their customer in. And when I learned that and started doing it, I got way better at marketing in my businesses because I was comprehending what response I wanted from the customer, what emotional state I wanted to leave them in. And then I figured out how to get them there. And I had much better close rate with customers if I started at that end.
ButI learned all that from the entertainment industry, from sitting in on meetings and watching them do that.
Clint Betts
Oh, that's fascinating. What's the bad movie? What was the movie? No, you don't have to say, I'm just kidding.
Jeff Hoffman
All right. I'll tell you. It was The Silence of the Lamb sequel, the Hannibal Lector movie.
Clint Betts
Oh, okay.
Jeff Hoffman
Do you remember that?
Clint Betts
I do.
Jeff Hoffman
The sequel was horrible.
Clint Betts
I do remember that.
Jeff Hoffman
And we were 20 minutes into it, and I turned to my friends and we're all like, "This movie sucks." And I was like, "How are we so excited about it?" And I was looking back at the commercials to see what they say that got me so excited that I went out there and camped out on a Friday night to wait in line for tickets for a horrible movie. The marketing was way better than the movie. That happened to be. I don't usually say this because I don't like to badmouth someone else's work, but you asked. That's the movie that I waited in line for, and then I hated it.
Clint Betts
Oh, that's incredible. Hey, I want to go back to entrepreneurship just for a second and get your sense on what does it take to be a great entrepreneur? What should entrepreneurs be thinking and doing every day to really hone in on their craft?
Jeff Hoffman
That's a great question. So there's a couple of things. Let's hit a few of them. One of them we just touched on, which is this, get out of your office, you're sitting in your office at your company, designing products, designing services, trying to run your business. But just as we said about the film industry, understanding who that customer is and how they respond. Our success, for my own companies, was based on when we decided to leave the office and go spend more, we call them, Day in the Life, go spending more time, spending a day in the life of your customer.
If you're customer, I'm going to make up an example, is a stay-at-home mom who during the day is taking the kids to the mall and walking around the mall for something to do with the kids. You should be walking around the mall talking to moms, not sitting in your office trying to figure out what they want. So that's the first one. Get out of the office, go find your customer, go meet them where they are, and try to understand them by being in their life, not in your life.
That became very valuable. During the early Priceline days, I spent a lot of Fridays in discount stores like Kmart and Walmart and in grocery stores, in the produce section, talking to people while they were shopping about travel. Not sitting in my office and trying to guess what they were thinking.
And probably the other one that's worth highlighting right now is that team is everything. You cannot do this yourself. And the problem some entrepreneurs have is they're a solopreneur or a small company, but they're the boss, they're the founder, the CEO, and it's going pretty well. That's actually dangerous because when it's going well, you suddenly convince yourself that you're pretty good at seven things. Because you're doing the marketing, you're doing the books and the finance, you're hiring people and doing HR, and everything's going pretty well.
But the truth is that the companies that really grew did so when the founders/leaders of the company realized that they needed to bring in people smarter than them and get out of the way. I'm an engineer. I should not be trying to do finance. I should not be trying to do HR. What I should do is I should do engineering even though I own the company and I'm the CEO and I'm the founder, pick the one thing you're good at, and quit kidding yourself.
You're not good at seven things. Pick the one thing you're good at and spend the rest of your time building a team of people smarter than you in every other area. That's the key to success, is spending less time running the company and more time finding people smarter than you and getting out of the way and letting them run it.
Clint Betts
How do you think about recruiting and how do you recommend leaders recruit?
Jeff Hoffman
So I learned a hard lesson. Because what most of us do is we post a job somewhere, or we might actually call a headhunting firm. But the problem with that is that you might sometimes get a rock star. But the problem with that is most of the people that are looking at job postings statistically are people that lost theirs. They're looking for another job. The best, the rock stars of an industry, the best people in the industry that you really want to work for you, they're not looking for a job. So you have to look for them.
And remember, my premise here is that you can't build greatness on the backs of average people. So don't try to spread your money thin and hire as many people you can by getting the cheapest people you can. Two rock stars are better than six average people. So when people tell me, "I can't afford to hire her, she's too expensive because she's a rock star."
So you know what I would tell you to do, "Hire just her and not two and a half other people. Go ahead and pay that amount and don't hire the other people." So when you spend your money on rock stars and hire less people, they perform. But rock stars aren't responding to job postings. They're not looking for one, so you have to go out and find him.
So that's my advice to leaders is go out and find people. When I realized it was time and I had a little bit of money to hire someone to run HR for me, I actually bought a ticket to the annual HR conference, even though I'm not an HR, I'm a CEO, and I went to the HR conference and it's filled with HR people.
People kept looking at my badge saying, "You don't work in HR?" I said, "No, I'm a CEO." and they were like, "What are you doing here at the HR conference?" And I would tell people, "I'm shooting fish in a barrel. There's 1000 of you and one of me, and I need to bring someone home to run HR". I found my rock star HR person at the National HR Conference, not on a job posting because she would've never responded to one. She wasn't looking for a job, but I was looking for her and all I had to do, which wasn't easy, but eventually talk her into it.
So go hunt for talent and hire less people, but go ahead and hire the rock stars that you keep saying you can't afford. You could afford them if you weren't spending some of that money on average people.
Clint Betts
You mentioned the early days of Priceline earlier, I just wonder, what's the genesis behind that company?
Jeff Hoffman
So Priceline was the idea of a guy named Jay Walker. He had a company called Walker Digital, which was an intellectual property company. Jay was basically creating business process patents, ideas, how to make things more efficient in business. And so he had this idea for the reverse auction, which was the name your own price thing. That was his patent for Priceline and Jay's, like, "If there's an empty hotel room that they can't sell for the $200 bucks, they're selling the other rooms.
You should be able to just make a bid on it, make an offer, name a price, the room's empty. We're getting nothing for it now, so maybe we'll take your offer." That was his idea. And then Jay reached out to a group of people, a small group of people, to go build the company, and that's where I came in. Jay reached out to me at the beginning and said, "I got an idea. Let's build a company around it."
And so a group of people was assembled to go create priceline.com, but the company was originally built, if you remember around the, name your own price auction. You make a bid on an empty room, and maybe you'll get it for that price since it's empty anyway.
Clint Betts
It was genius actually, particularly at that time.
Jeff Hoffman
It was. It was a very innovative idea and obviously it worked.
Clint Betts
It worked really well. How can entrepreneurship be a force for good? And I imagine we both think it already is, but what does it mean for entrepreneurship to be a force for good around the world?
Jeff Hoffman
So the key to successful entrepreneurship is problem solving, solve an actual problem. A lot of times I see entrepreneurs and they come up with something, they hold up and they go, "Hey, I invented these." And I'm like, "Who actually is looking for one of those?" And they say, "Well, we'll see. I'm about to try to go sell them now. Hopefully someone wants one."
That's one way. The other way to do it is to be out of your office out in the world and notice that the world is filled with real problems. And some of the world's most successful entrepreneurs are the people that solved them instead of complaining about them. So I see entrepreneurs because again, at GEN, we're in 200 countries. People that see the problems, and I don't care what city in the US or country, city, elsewhere in the world you live in, wherever you live, there are problems.
They're just different kinds of problems. And so solving real problems, which entrepreneurs do faster and more cost effectively than governments or big companies, for a couple of reasons. They act faster because they have to, if they don't sell this thing and make money, they don't eat. So they're efficient because they're hungry. And they do it for a lower cost because they don't have the overhead. It's not a big company, it's just a small group of people solving a problem.
So entrepreneurs quickly and efficiently solve real problems in the community, and they make things better everywhere. That is the lesson. I'll give you an update on those numbers for Unreasonable. Now, the total is 359 companies that are all out there solving real problems in the world to make the world a better place. They collectively raised $11 billion in funding—
Clint Betts
Oh, wow.
Jeff Hoffman
... since launch. Those companies have generated real revenues of over $9 billion. They're businesses, selling products to make the world better. But here's my favorite number. We have determined that globally since Unreasonable started, we have positively impacted the lives of a billion people on the planet. Giving them food, giving them clean drinking water, giving them access to off-grid energy, something that made their life better. So entrepreneurs are creating real solutions to real problems, and they always have, and they always will.
Clint Betts
Jeff, your energy is contagious. Again, I can't thank you enough for coming on the show and sharing everything that you shared. We end every interview the same way with. At co.com we believe life is just as much about the chances you give as the chances you take on yourself. And I wonder who gave you a chance to get you to where you are today?
Jeff Hoffman
Wow. I will say it was my very first startup. I was a software engineer at a big engineering company, and I hated it, even though I had a good job and I quit. And I was 20 something years old and standing in an airport and I missed my flight, which I couldn't afford to miss because I was broke and unemployed. And that's where my first product idea came up. I went home and said, "It's ridiculous that you have to stand in line and check in to a flight to get a boarding pass, in a line that was an hour and a half long that Friday afternoon."
So I went home, took out a pencil and started drawing. And today, when you go to an airport and you check yourself into a check-in kiosk, that was actually my first product, my first invention. And I needed one airline in one city to give me one chance to put the kiosk up and let them see what happened.
Everybody told me no everywhere because I was some little startup. These are major airlines and major airports, and I'm like, "I have this electronic thing. Can I put it in your airport?” They're like, "Hell no. We don't know who you are and we can't take a risk with you." I needed one person out there. One investor who did believe in me so I could actually build the machines, some prototypes, and then one potential customer who said to me, "Jeff, let's bring one up. Let's give it a shot and we'll see how it goes."
Because those two people gave me a chance, the rest of it wound up being history.
Clint Betts
That's incredible. That's so cool. Jeff, thank you again so much for everything you do in the world, for everything you've built with particularly the Global Entrepreneurship Network and The Unreasonable Group. I genuinely believe that it's changing lives for the better. Thank you so much for coming on, my friend.
Jeff Hoffman
Thank you for having me.