Are tariffs good or bad for founders?

for all of my by friends this is their only business this is literally their lifeline and so i find it very not cool is my official diagnosis super and cool by the orange y i feel like i could rule to world i know i could be what i want to from at all in it like a days off on a travel never looking back alright sean mahal hollow my first question is what's it feel like to be an extra on the set of white lotus as long as i'm not the guy who dies i'm good alright so that's my that's my white lotus k plan i i thought i'd be festive for you i i think you look good dude i was so as you know i don't leave my house and take the family vacation so we're in hawaii and i texted ben i go dude i'm get recognize recognized left and right and he goes really that's awesome like how many times was ten eleven and i go no dude two left and right i haven't tried this down kinda it takes you right away this is amazing where did you get regulated at the airport deuce someone voice recognized me i was like coming around the corner somewhere i'm talking to my kids and some guy just runs around the corner and he goes hey are you show are you sean i go did you just recognize my voice yours goes yeah listen to like the listen of the podcast buds dude there's been so many times where like i've met someone in my like we should hang out whether they text me it i like get on this flight yeah you gym ticket well like if i'm like flying home and like someone sitting near me i'm like do you wanna be friends to like get together sometimes i then they'll message me a week later i'm like what they doing it's like going to the grocery store hungry like i'm just like making bad choices can we talk about tariffs really quick first of all i wanna let people know i don't know anything about this like i'm not like an economist which everyone is all of a sudden but i wanna know did you go to hawaii because you were sweating and you're like i need to find peace or or what to the last time i came to hawaii i don't remember this was in twenty twenty wasn't it like a a some crypto thing like you i landed and the same day i landed crypto had the biggest crash like luna basically went broke and it brought down bitcoin with it and i basically landed and then lost a million dollars and it was just trying to hang out with my wife and just be like okay cool i'm just not gonna to mention this like how expensive this vacation just got and the worst part was because i was on vacation i didn't have like any of my normal like computer or hardware couldn't sell your i could do anything yeah like you know oh this cold storage were gonna great so i was i was basically stuck and then to this time same thing went notification oh the s p five i've hundred is at the worst like three day losses since like the bubonic plague and was say oh great here we go again i'm not coming hawaii anymore when i been going through this as everyone knows i'm i'm heavy on index and when i have been going through this my i've just i just don't look i just i just look i don't look i just i pretend it doesn't exist and i don't look although i did i i invested a little bit more than normally i do every month and i went a little bit heavier but i just didn't look i just i can't log in it it it makes me too anxious and it really ruins in my day yeah i well i asked this simple question am i gonna do anything because my plan do do i have some trade i'm trying to make right now is there some some genius move i'm just trying to panic sell no okay if not then there's really no point in even looking it's just gonna ruin my vacation so i don't i don't look but when i landed i there was something i had to look at which is these tariffs so not only did the stock crash or maybe because of this the star market has been crashing which is that donald trump has created a new holiday sam liberation day yeah a solidly he lives exactly day if somebody was like maybe he met liberation day in the sense of liberation like the buddhist think where we are being liberated of all of our possessions and we just aren't gonna owed anything anymore i don't have any material goods anymore thank you so he came out and he has this giant poster board slam to every country that's basically like a slam board where he's like china you're getting tariff get you're getting everybody's getting tariff and and then since then he so he came out with like a fifty percent or or whatever of it was like a thirty five percent plus a twenty percent tariff on china was like wow fifty four percent that's it's gonna be crazy and then since that he added another fifty percent on tops so now we're at one zero four and i was suppose there's just no upper limit bit as to how hard how high i this could go because this morning as of this morning china retaliate with its own escalating retaliation eighty something percent tariff so we're in a trade war and does that mean for you as an e comm owner when you buy ten thousand dollars worth of goods from china or if you do buy them from china that now you're be you're gonna pay twenty thousand dollars yes exactly okay so it's as simple as that got it is that as simple as that so basically and and the the reason to talk about this is not because i'm a tariff expert not but because i have an e com stores and i have a lot of friends in e commerce as well and for all of them maybe mean this is like basically so most of us manufacturing in china not because we're like oh i really wanna have the lowest cost goods from china that wasn't really the impetus the fact when i started our company we first looked at manufacturing in the us we were like oh that'd would be great it'd be great to manufacture in the us it'd be a great story to tell to customers also maybe will be faster lead times because we're not having to put every item on a boat and sail it across the sea so i called all the manufacturers i can find in the us and i was like hey like do you think you could do this and most of them are just like no and one guy in la was like oh yeah we could do this do you want it for double the price half the speed at half as good because say sales yeah like that he's like like i'm just big honest with you he's like because if you're comparing factors you're gonna find this he's like i was how could it be half the speed or there's no boat there's no sitting on a on a boat for a month they would explained us he was like number one all of the inputs to anything you're gonna make so even if we make it we're gonna import all the parts so we still have the parts on a boat for a long period of time secondly we don't have the labor that's skilled at doing this third we don't have the machines he was like actually it's the machines not the labor that's the problem he's like basically when we kind of d industrialized all of the best machinery to do this work went to china there's only like so many machines that do this right now to get a new machine takes like a year and blah lot times cost so much of money as so we don't we have the machines and i was like okay so there how does this guy answer the phone is he like f you this is derek you know what i mean like i don't want your business how are you is there anything i cannot get for you yeah like this is alright have a good but bye now go up yourself like that just all that's just how they do they answer the phones obviously great a great game as far as they maybe he's like a retired guy really my dad would like to do that in retirement down all day and so what are your friends thinking in the industry because it seems dude do you guys just get beat up constantly you know what i mean just get punched all the time yeah it's like okay bake over america great again which where's the great part and what's happening where but all we're doing is putting like all these small businesses out of business and raising the price on consumers right so here's what's happening so just to give you a scenario i have a friend who is doing really well with this business and the business has been growing and so prior to trump taking office he's you know who's growing the business trump takes office he says he's gonna have a tariff he says he's gonna be a twenty percent tariff so we're like okay mentally prepared for twenty percent tariff so we placed an order now just give me a sense like orders have like a forget about moving your manufacturing which is a multi year process that may not even work by the way just like changing your like sourcing from one place to another is you know six months to a year to get it up to scale this guy you know busy he's operating on a four month lead time meaning from the day he knows he needs an or she needs an order he has to place it four months in advance so he placed it four months ago now four months ago he's basically you know before trump even took office right so he placed that order and now as that order is he's got five containers out at sea about like on this ship and they're like yeah it's a hundred percent tariff now so he has to pay a million dollars in tariff he doesn't have a million dollars so he's like look he's like dude i literally don't know what i'm gonna do like i i don't have a million extra dollars front lying around of my business that i could just pay this tariff i also have five containers i thousands of units just sitting there they can't be reroute i can't tell them to go back to china i can't i can't he's like what i do is shut down my business he's basically like totally screwed and so this is comment there's is a lot of people are dealing with this you and i have a mutual friend he said the same thing he was like he's like my container you know the price break container got screwed during a a bunch of stuff in the last two or three years there were so many different things there was the panama can or well sue suez can i forget whatever there was the ship got stuck yeah a ship got stuck then there this and then there's that and then now he's like this thing he's like i don't have enough money to buy the goods that i have coming in because i placed the order like a month ago like all like it was like in transit it changed the price it's one of it's like when a parents like you say no word the five more minutes of time out there's five what what did you yeah five more five four you just got yourself by totally in fact i'm gonna stop start calling it tariffs with my kids i'm just gonna start using that lingo maybe maybe maybe it'll be fun to be on the other side of the tariff world and and there's a little bit of so now people are trying to find you know whether it's workarounds or you know try to figure out hey does this apply because it's kind of unclear even how the supplies you know does it matter if i got my goods on the boat beforehand either way whether whether this shipment gets tariff a million dollars or not point is it's very hard to survive as a business when you're you operated let's say an e commerce business that has ten to fifteen percent profit margin if you're doing things right you know twenty if you're really kicking ass and you've been business and been a business for a long time and you have economies of scale and you have a large returning customer base but like ten to fifteen percent profit margins and then your cogs go up by a one hundred percent is not gonna work like they're gonna go broke and so the the only alternative is you have to pass that to the customer so now you have to tell the customer hey what this what this means to the customer the math is if a normal let's say a unit of your thing cost a dollar and now it's gonna cost two dollars well before you sold that one dollar thing for let's say three dollars or four dollars let's is hey four dollars a four x market right so your cogs just twenty five percent four is is is i would imagine is very normal yeah a standard market let's say and that's out that sounds like greedy oh you're already marketing it at four well no because you have to pay for marketing and advertising and your staff and the fulfillment and all all the other stuff you end up with a ten to ten percent fifteen percent profit margin by the end of it which is like restaurant territory and so you know it's not some we're not some fat cats over here in the e com land go lucky economy you just see what's a tired sc fools who like are just playing the wrong game and so you you take that dollar item now it's two dollars well yeah that means you have to raise the price instead of being instead of a big four now you gotta raise it to five to make up for that right so you're all your goods are gonna go up by twenty five to thirty percent so that's inflationary right so you if you thought you know inflation was bad before or the price of eggs and all the stuff well wait till christmas season comes and nobody could buy a toy because all the toys are made china right this is things all the shirts made in china all the toys are made china and if they're not made in china they're made in vietnam which also got tariff and so it's like you know the there's a few countries that make all the stuff and this plan really doesn't make a lot of sense to me now maybe i'm just being sensitive because i have a business for your lifeline yeah yeah so well yeah less so for me because i have a lot of businesses but for for all of my friends this is their only business this is literally their lifeline and so i find it very not cool is my official diagnosis super and cool by the orange yeah i think you you need to create like a sean's homie private chat lobby and you guys get spend literally thousands of dollars to lobby the government to change their opinion dude i'm gonna go to the lobby of this hotel to see if i could get someone to change their mind is that what lobby amazing just probably lobbying i'm doing and you'll declare bankruptcy down there by yelling it to declare it okay so by the way i don't know if you've read mo who added a few know mo mo hart he wrote a great post on x i think it's worth reading and his space called the america underestimate the difficulty of bringing manufacturing back and he has fourteen reasons about like why even if he took the generous side of this like policy and you're like oh you know what short term pain for long term gain right because i think we can all agree they're short term pain right the business owners have short term pain the consumers are gonna have their prices very short term pain the factories on the other side i have short term pain the stock market is crashing that's short term pain the four one k's are going down so that part's pretty una the short term pain the question is is there even long term gain and he wrote a post that basically outlines like you know very you know thoughtfully why there's some problems with this and he's basically like you know one one argument after another it's sort of like not only does moving a manufacturing plant back to america take a long time like by the time somebody by the time a business owner who today is gonna hit by these tariffs assuming they could somehow survive spend millions of extra dollars opening up manufacturing in the united states which is not gonna happen and it's a multi year period before they get it all online and then they magically find the labor to do this because we don't really even train people in america to do this type of work anymore there's gonna be a new president and like you don't even know what this tariff situation is gonna be but then they might be a totally total fool errand to do it by then so nobody's really gonna be able to make that move most likely what's actually gonna happen is like he's like you know we try to do this in trump's first term and all we did was make vietnam great again like basically the manufacturer just shifts to one of the other low cost asian countries that has lower tariffs is what's gonna actually happen there's not gonna like magically bring jobs packed oh and by the way you don't want sit there knit t shirts either like this is not a job you want these are jobs china doesn't even want yeah you want it dave chappell was like i wanna wear jordans i don't wanna make them shits exactly perfectly said and like there's just memes going around of like you know it'll be like chu off like at a like a sewing machine to make sure it's so true was like is this what you think is gonna happen is this america being great again i'm not sure and so you know political stuff aside i think that the the tariff situation is really crazy right now and as a business owner it is very very tricky how to navigate this amongst your friend group is it gonna put anyone out of business or is it just going to draw their margins like is this like a complete huge risk or is it like you've just made my life more challenging it's good for sure puts of people out of business because you had to like like i selling my my friend with the stuff already at etsy or just trying to scale their business they might not be able to sell their product for an extra let's say there were a hundred dollar product before and now they're a hundred forty dollar product in order to maintain you know a still some profit so on one hand demand is gonna go down right i'm gonna have less customers because i to raise my price my cost went up my cash flow that i had in the business went down and maybe down to a point where i'm needing to borrow money in order to just pay the tariff bills that i have of stuff i've already had flight it's a very very tricky situation you know what we did in our business was i was like okay here's how you deal situations like this you have to create like a immediate swat team and let's open up a google doc let's make six bullet points it's like what are the six levers we could pull okay so pricing we're gonna have to create that some sort of tariffs surcharge and we think it could be in this range that'll offset some but not all of the amount because we can't pass a hundred percent of it to the customer it'll kill demand and so we're gonna pass you know a few bucks to the customer this way the next thing we could do we're trying to source for another country okay it looks like you know maybe it's mexico or it's india or it's a one of these lower tariff countries okay you're you're working on that you over here you're gonna work on you know figuring out how we're going to lower our cost you're gonna have to go negotiate with the factory ask them to share some of the burden with you you're gonna have to look up the talk to lawyers and see what's going on with the stuff that's already in flight hey we're gonna have to bring down the purchase orders because we have to be way more conservative hey you're gonna have to go secure more debt because we're gonna need a line of credit to make sure we can withstand the the storm here you and so we created this plan i was like we're meeting every day these five people like the five core people the company whatever our other priorities you had they're gone this is your priority now we're gonna meet every day and we're gonna work on this plan for the next you know end number of days until this plan is executed and i think it's gonna take that level of of intensity i think a mistake i made in the past is when things like this happen and you sort of take a little bit of a wait and see approach i think that could be very every day that you don't act could be very costly as a business owner and so i think one of the key things to do and like in our business we have a ceo we have a full exec team but when i heard how they were planning to approach us it was like yeah this is like really important just like these other four really important things we have and i go no no you need to like have a public you know psa that this the most important thing you could do we're gonna eat every morning there was there's a name for this team and this this is the most important thing we're doing and this is your top priority you need to cut off with some other shit right like i think just raising the level of intensity is very key in a situation like this or people will go out of business so you're gotta go to snorkeling yeah i know as so i'm on the call talking about how we have to like they'll raise the intensity and there's literally just like oh wow there's like is like calming like hawaiian and music behind me and like clearly like palm trees and like guys guys this is life or death and i like i like like going down a water slide on the google meet i didn't plan it to swear right you you stop like mid talk to like get your drink that has the umbrella on it and you're like looking for the straw with your mouth that's awesome well that sucks is there a world where is there any you know like what are they what are what a george just like that is there anything i could do no no nothing you can do with dude i have i met with the guy the other day and i thought i was like why do you wanted i'd never take phone calls with people but he wanted to talk and i thought he was gonna end a conversation with like look like you know i've loved watching you get big and be on the pod and you know is there anything i can do and i thought he was just like could do to help and he said is there anything i could do to be a guest on the podcast i was like wait what i thought you were gonna ask me how you can help me that he just ended it with is there anything i could do to be on your podcast and to have you promote me i was like no there's nothing that you could do wow hell asked good yeah was a bold ask do you wanna talk about something more fun please alright let's talk about something more fun i think this is actually gonna be really fun i i'm gonna try and take your mind away from the fact that the company that you've spent decades trying to build which are i'm gonna try to take you take your mind off of that it just you know four decades you spent building this company not fan never send sam to like the cancer ward the whale side manager we don't have time much we don't have a lot of time left so let's get to it sorry i meant you don't have a lot of time left so let's sorry have to get to it alright but i did i did i read something interesting that i when i read it i was shocked by it and the reason i read this thing was because my company hampton it's basically like an events company we it hundreds of events a year and so i'm trying to learn how other like event based businesses operate and i found one that i totally didn't realize how amazing it was and i just forgot about it have you ever heard of the medieval times it's generally yeah yeah azure sure no the restaurant siri like the restaurant franchise hit no you've never had oh my god you are gonna love this okay google is it like rainforest forest cafe but for like more oh there's like basically it looks like a small castle like the scour hotel in vegas and then inside there's like people on horses jo dude i always thought this was just like a joke i thought this was a joke in like nineties movies this like for where people were going for dinner i didn't realize it was a real thing so let me tell you the story so medieval times it's basically dinner theater and so they do a two hour show where you go with you your wife and your two kids and you spend something like eighty dollars ahead and you see people host a medieval show there's like two hundred actors and they like do jo they do like some type of theater stuff it's almost like cirque sole but it's medieval stuff and it's like it's like wwf f or something like wrestling like it's all like acting i did not realize how big this was so let me tell you the story so the guy who started it his name was jose he was a spanish guy he had a small restaurant in spain where he would like have like medieval like circus performers like doing juggling and just really small stuff at inside of a barbecue joint in spain in the eighties for some reason he decides to move to america and he's like i wanna create what i did in spain which was a really small thing i'm gonna do it in america and he convince a couple bankers to invest eight million dollars into his first restaurant and that first restaurant was in florida and he creates what is now medieval times and he creates this thing where the idea is we're gonna host something like twenty to forty shows per month i'm gonna hire two hundred actors he spent a year training these guys how a sword fight how to jo how to like b like legit actors and he's like we're gonna serve you turkey legs and another medieval food like whatever like the stereotype like stereotypical medieval food is and we're gonna create this dinner experience and that's what he launches in nineteen eighty three well fast forward almost forty years now or forty plus years his son has taken it over and they were recently sued because a bunch of their performers tried to union utilize and apparently they were preventing them from union and so there was a ton of articles written about this company and a lot of people were talking about their financials they're enormous so this company does the so basically they have it's estimated around two to two point five million people a year coming to the restaurants and they make something like a hundred and fifty to two hundred million dollars a year in ten locations hosting these dinner theater shows it's amazing i had no idea this was this big and since nineteen eighty three they've hosted close to eighty million people at these events have you ever been to one of these no so there's ten locations and i haven't lived in any of the places dallas myrtle beach scottsdale like places that i've you know haven't really lived in so i've never been to one have you no i've never been to one say the numbers again so how big is this a tech just on ten ten locations on ten locations during the union lawsuit and things like that reporters were doing back of the envelope math and they were like we think the company does between a hundred and fifty and two hundred million dollars a year in revenue and there's ten locations and each location host something like depending on the the how popular it is but the lowest one does something like twenty twenty performances a month all the way up to sixty performances a month so two a day for thirty days it's insane how much demand there is and it was estimated that it was around two million people a year attending and on their official website they say something like eighty i think they say seventy six million people have ever attended a medieval times restaurant for one of their performances is that same so you know ten to twenty million dollars per location and they might be making you know one to two million dollars of profit per location something like that so with this my guess or more so the way it works is it's not a normal restaurant and so you don't order the food it's all pre selected and so it's like it's like an assembly line at the same time all one thousand guests get the exact same food so like there's a lot of like maybe potentially significantly more efficiencies than a normal restaurant because there's not like you know a whole menu of stuff to do and get this their performances they only change their performances every five to seven years so they spend a lot of time like making their performance and then everyone else just goes and learns it and they perfect it over the course of five to seven years so they don't even change it that often and it takes like two hundred performers for every show yeah it's pretty rough for you know night performers right because you have like to step down between game of thrones and the medieval times restaurant restaurant it's so fast like the second place it is is really it's pretty rough out i gotta do it it's gotta do it so this is hilarious because you were like you were like looking this up as an analog for hampton are you thinking about getting in the turkey leg business what's going on well the way that we are gonna grow is through launching cities and i'm like you know trying to study like how launches work how do have like general managers of each city of each region do you i'm just trying to understand like the logistics of it and i'm looking at a variety of unrelated but still in the event space just to figure out how do they do it how do people do it and so i'm just looking at a ton of different ways and i was just curious about for some reason i came across these guys and i started thinking about it like they at ten locations or are they franchises how do they work and it just caught my eye and i was shocked at how big they were dude can i tell you the goofy story that's kind of similar to what you just described so i've been writing this book like on the side i'm not sure if i'm i'm gonna actually publisher or not like but i kind of got i went down a rabbit hole interested in it and it was it was around how creativity works so how peep how to be more of how to be a more creative person and ultimately like make hits so like where do the hits come from what's the title bad art bad art okay yeah so it's like a because there's one of the key like obvious sounds obvious in in hindsight but like when you go look at the creative process of the world's most successful creative people you would think a lot the ones who make the hits the things that we all love the high quality stuff they just nail quality and if you listen to any of their interviews you watch the process they don't give two shits about quality directly what they do is they focus on quantity and their belief is based the quantity is the only way to get to quality so they're they play a volume game and they're like we produce a lot of bad art and that's where the one or two things that are real gold come from if you just sit down and try to make gold it doesn't work you know you actually end up not creating at all and so one of the things i've been looking at is like how some of the big breakthroughs came from doing what you're talking about which is like you learn from an adjacent space so you go and you you know the wright brothers who ended up creating the first airplane dude george i i i read their book and they're amazing but george mack summarized their book amazingly in his high agency blog post yeah yeah yeah exactly so they you know they were they were not funded they had no education they had no team they had no no specialty no experience doing this no nothing and like meanwhile there was a guy over there funded by the smithsonian and had two million dollars in funding had tons of engineers and scientists on his team had all the press and the fan fare it was clear that he was gonna be the win he was the favorite so how did the underdog win why did the underdog have them create a breakthrough and like one of the reasons why is the two brothers the right brothers they owned a bike shop and so they they because they had no money they did like two hundred prototypes in the time that the other guy did too and their two hundred prototypes were basically like they weren't even didn't even look like planes they were just testing like individual parts of a plane like they'd make a glider or a wing and then they would make the wheels they were trying to find different ways to test these things out and even kitty hawk even the selection of where to go they were like thought from first principles like where should we launch thing like oh baby we should launch it from this spot where we're gonna the best way that etcetera right so they they weren't like tied to anything that was like there was they were not tied to anything everything was first principal thinking similarly i don't know if you've heard the story about the the yankee bats have you seen this you'll have to enlighten me but basically the bats are heavier in the area where the ball mostly hits is that right yeah like the story i mean take the physics of it aside like the story is just kind of interesting because here you have baseball this game that's been around for like i don't know hundred plus years or whatever and then you know just kind of in a a a bit of a high agency way the yankee were like hey can we just make a better bet like within the rules of the bat like you know we're not gonna get heavier or bat we're not gonna cheat and they hired this mit guy to think about it and he was like oh yeah you could just like move more of the barrel to this one sweet spot and if you hit that it's gonna go way further way harder and you if you'll have less misses less than misses because you're gonna have the thicker part of the bat right there and you'll have more barrels and sure enough the yankee start to season off with like way more home runs than anybody got this year i don't know anything about baseball but is it statistically significant or do they just have baller on their team this year is it like it is the bat i think it's the bat but i don't know if it's statistically significant i don't know if you could say that right because it's it was like they started talking about this when it when they like jumped out to a big lead in home runs like fourteen home runs already and it was like nobody else is even close like so we'll see you know we'll see this this lands but the important part because like who gives a shit about baseball the important part was like dude if if baseball it's like hundred year old sport that like you know people spend the team spend hundreds of millions of dollars a year trying to like find any edge they can if there's still like an edge like this to be found it just proves how like so much of the world is like una una unauthorized and under thought about and like if you actually just took a lot of focus and intensity to one problem and you don't assume that people have already figured it out that's you know one of the key things you need to have a breakthrough so like the way you're talking about studying these other models i think it's so important to do that i remember when we did our our our restaurant this is my first starter but we did very much everything wrong like every now that i look back i'm like my god so embarrassing every like the way we did our business plan we wrote a three hundred page business plan it's like dude now nowadays i write one page if not if that we literally printed it out in the binder we were so proud of it and we thought that that was like you know mark of our brilliance when actually is just a market stupidity our marketing you know i used to just go door to door knocking on doors trying to sell sushi like an idiot like i didn't know anything about facebook ads google i didn't know anything about anything but one more thing we did was we were like we were a delivery only restaurant so today they call that cloud get just back then that didn't exist door door sushi i think is the worst idea i've ever heard you right but i was like oh let's try it actually by the way who doesn't wanna to eat this at ten thirty and when it's ninety five degrees of dallas no what we and did is i went door to door i went floor to floor really i went into a skyscraper and i went i just went to the elevator i pushed a button one two three four and i'd get out and i just talked to the office manager of each floor if i could get her cater the lunch it was like getting fifty orders and it's actually not actually worked very well so that was kind of like a bit of a bit of example of this of ignorance is bliss so the the other thing that we did was we were looked at delivery so traditional food delivery you were talking about city to city expansion we looked at how all this all the big restaurant chains did the delivery and what they did was they would basically have a delivery driver at the restaurant kind of waiting and waiting for a batch of orders so you would order but they wouldn't just take your one order they wait there's like five or six orders to job right because if i leave then with one order that's inefficient so they would first wait from five or six orders then they would drive out they'd go one place at a time try to deliver these things and then they would drive back and what i was so confused about was like how is this restaurant that's one mile away why does delivery take forty minutes but just didn't make any sense like the route is like two minutes so like how how is it possible that it takes forty minutes for the order and so i watched them i studied them and we had our buddy dan become one of them and it was like dan you you work for noodles and company now you gotta figure this out you were doing the deal move before deal did it you had yeah we sent and we sent to spy yeah yeah and it's being nice all he came back with was just like you don't eat the food and noodles so much salt really but what about the delivery he's like oh i didn't even get to delivery i gotta find soup so i could make tomato soup he's so much salty as soup it's insane so but we we figured out a breakthrough there the breakthrough was basically when we realized that it was at the slowest part of the delivery was not the drive it was the driver doing that last kind of not even last mile like the last two hundred feet to your door so like finding the exact house or or or apartment and you go there and you knock and you weigh and then they come out and then whatever that was the way the slow part was and so what we did was in downtown denver we created something called the drop zone so in between a whole bunch of skyscrapers we just had one guy so stand there he was our delivery guy of the ground and then the driver just kept going back and forth dropping off orders to him stop and this sped up delivery like crazy and suddenly our delivery times for like fifteen minutes sixteen minutes eighteen minutes and we were just crushing everybody on delivery and like the restaurant failed but the learning of like you can't really take for granted that like everything's just figured out and if you just do the first principals thinking of like you watch you look for the slowest part than then you think okay what can we do even if it sounds a little weird that we're gonna have a we're just gonna put a dude there at the bottom and he's gonna stand there holding the orders the delivery guy is just a stationary dude but that would eliminate all of the lag of the driver having to wake for that last you know to do all those last mile deliveries that was the key for us i found when doing this there's a few hard parts the like just doing the exercise the hard part one is knowing what things to question and what things to accept for example let's say you're creating tesla and you're like well an electric battery that that probably can go long enough like if i look at this the map behind it but they didn't like change the shape of the wheel that's a very obvious one but when you're running a company it's very hard to decide what to question and what not to question it's also incredibly challenging to get yourself into that mindset of first principles thinking and more challenging to convince your staff or your coworkers whatever to just like come with like an open mind and and actually get on board and being open minded to trying the exercise i found that to be hard what's hard about it and then how did you try to tackle that for example just like the people saying like well it it has to be this way for these reasons and it's like you have to say to them i know but just like i know you think that but just try to get beyond that just for a few minutes and let's just have a conversation where it doesn't happen that way what would happen there's this book called the six ways of thinking for design i figured forget exactly do you know talking about that book no i haven't read that basically it's like an exercise where there's six different colored hats and you're like alright your green hat when you put your green hat on that means you're just thinking a profit when you put your red hat on that means you're gonna come and be very pessimistic and poke poke holes and everything your black hat means you're open minded and it's so it's this way of saying right now i'm gonna put this hat on which means i'm going to by default i'm not gonna hate on anything because a lot of people default to this is why you can't do it to i'm gonna figure out all the reasons why this could work yes yeah and so you do that you tried that yeah and it helps but it's still i i guess what i'm saying is that no didn't have any hats no it it helps but there's still like it's still a challenge to get into that mindset at least for me and also to like convey that to teammates it get having an open mind and question everything is actually way harder to do than it sounds you know what i mean yeah yeah yeah yeah i i let people like it like so once you give people permission to do it they actually get excited about it you're right that you have to sort of like frame it the right way if you just go into a meeting and you're hoping an expectation is that people are gonna be like open minded and creative and come up with a novel solution it's like not gonna happen at all like you have to either tell a story at the beginning that gets them in the mindset i've i've done that before which is basically the the yankee mapping i mean that was pretty good yeah like it'll be one like that or it'll be like i remember back of the day i watched this thing on youtube that was really inspiring to me i don't know if you ever seen it it's the ideal grocery cart challenge so idea which is this design thinking lab there's group so companies go and pay them lots of money to come up with like novel innovative solutions and designs so i think sixty minutes or somebody went to them tv show and they were like hey we wanna understand how you guys think and so we have a challenge for you guys as part of the show and they were like we want you to redesign reimagine the grocery cart in a day they have twenty four hours forty eight hours to do this and so they break up into two teams and they show their process of how they do it right so like there's like a process of like fact gathering so they first they go get a grocery cart right or they gonna watch it in a grocery store they wanna see how the customer uses it they don't wanna take anything for granted so they're like oh like certain set of customers actually use this as like a kid babysitter center it's like your kid sits inside it they need a thing to play and that's like a key part of this like if you lost the kids seat you would lose that mom as a customer oh other people are loading up and they need the two racks and then you know so you're seeing how people use it then they were like cool you and you state those observations they put them on index car you start throwing them on the wall and the guy sets the tone he's like we're in the diver phase and basically he draws this little cone i don't know if ever seen it's like a like a tone going out and he's basically like during the diver phase it's like whatever a pre predetermined set a time our team knows how to do this which is when you're super crazy wacky ideas free play what if mode and you don't judge the ideas during this phase you're just trying to rip r as many ideas hand and then we're gonna switch modes switch ads gonna go to converge where we basically ruthless narrowing down the set of possibilities of where we might go with this but we we distinctly have two phases because you don't want in the one phase the one brave person to be courageous and throw throughout a half baked idea and then somebody immediately smart guy slam them and be like why the that wouldn't work and now nobody wants to suggest ideas it again for the rest of that hour so you have to like really explicitly be like what you're allowed to say during this hour is only you know yes hands and then during this one it's a no and then they end up with this redesigned grocery cart where it's like it was basically like i don't know you can look up the image of it online but it was like a a thing that was designed for a new type of grocery card and yeah i thought about that i was kind of inspired by that because hey i just thought wow what a cool job these guys get to be creative for a living the top this video is fifteen years old and it says the top comma is they're still making us watches for school by the way in two thousand twenty four yeah that i i actually think there should be a netflix show of this like you know that you have chopped where they give them a random a basket of ingredients you gotta make a meal out of it i i would love to see like two teams that are like you know engineer designer types andy you basically give them like a challenge like redesign the grocery cart like redesign make make the inside of an elevator more entertaining and just see what they do like i i find that super fascinating as like a tv show i think it would inspire a lot of people to become like engineers or designers if you watch that the same way like shark tank although it's like totally like bogus in terms of like the entrepreneurship that they show it's super accessible and i guess people excited about the idea of entrepreneurship this book sounds pretty great bad art it sounds it sounds like a pretty good idea it's a great book i'm excited about my my the only hesitation i had on it was like i feel like i already got a shit ton of value out of it doing their like research restriction the kind of the prep like of outlining like oh here's the big ideas and crystal them my mind so you're gonna be like derek from la and you're gonna just say f fu reader i don't care about it it's exactly do i need to go the extra publishing it for other people to benefit i'm not sure that i i care about that like i'm not gonna i'm not gonna make any money off this i'm not trying to get famous off a book what i why do i to do that so i might publish it the other problem is like i'm not sure how many other people nerd out about this idea of making great art making making great products it's just insanely great things and caring about being they're like wanting to learn the creative process because you know what i what i figured out that that i mean that that's obviously foolish what about that guy like that's a feel efficient yeah yeah yeah you you you got you caught you got me on the hook you got the compliments on the hook because i what about that austin guy like you know artist what was it called great artist steel is that what do i wanna just be that austin guy you didn't know guys last name i know the boat cover what's isn't it like a what's the called artist steel yeah like i know that a lot of smart people whose books i read they always say that that like we had a jack carr on the podcast who wrote all these amazing fiction books i love and he talked about it ryan hall talked about it mark manson who i know you like talked about that book everyone but that's the thing it's a lot of author like i wrote this i wrote this thing because i was studying how to do this because i wanted to write a book i didn't want to write the book about this but that that's just where i landed it's for sure super important for anybody who's like an author screen writer type of person it's just that's such just small percentage of population that i'm not sure it's worth the pain of of publishing but dude yeah i know if you feel the comment of youtube persuade we enough i'd like to open publishing this if sci hill bloom can convince everyone on twitter to share his book you can too what he's hilarious about sci sounds is great and sci is such a achieve he brought the pe energy to totally he he about the the the ivy league energy right he like p he like achieve his way into stanford achieved his way to being a good athlete like a like a d one athlete achieve his way into private equity successfully achieve his way into a six pack achieve like he just basically he's like alright jimmy a target and like she'll be she'll be a ladder and i shall climb and it was like when we were like y you should twitter do dude like you're your posts are kinda interesting i think you do this he's like cool monday through friday six am get up cold plunge right thread published thread every day for the next nine hundred days straight every day they got like a billion followers he achieved this shit out of twitter it's amazing yeah now you're gonna have to get same with that are as elon once said when they asked him are you afraid to failure he said it is not in my nature and so i feel that shiver it is not in my nature to do is that gonna be that should be the reply to everything though as a great elon musk has once said this is not in my nature don't how sick that phrase how how how like timeless and alpha outflow that phrase alright is that it are you gonna go and enjoy the enjoy the sand or doing whatever you do do you even leave your apartment when you're in hawaii yeah dude i'm in the ocean mean though i'm at the beach i got kids do they wanna do everything are you gonna wear tweet enjoy same day every day for six days trade like it's the same day but they love it so much that i i can't help love it to alright that's it that's a pod i feel like i could rude where i know i could be what i want to put at all in it like a day's off on a travel never looking back