I have a unique role at Business Insider. One that, in essence, involves two jobs.
Half the time I work on our "This Is Success" podcast, interviewing people who are leaders in their industry (or on their way to the top) and learn lessons from their successes and failures.
The rest of the time I spend writing in our special Better Capitalism, which explores why business leaders are beginning to conclude that the dogmatic, shareholder-first approach that has reigned supreme for decades must be replaced.
As 2018 draws to a close, I have taken time to reflect and draw the conclusions that have impacted me the most this year.
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Barry Diller, president of the IAC, has an unusual hiring philosophy: It's better to promote a young executive to a leadership position than hire a veteran from the outside.
This is how Anjali Sud ended up as the CEO of the IAC video company, which owns Vimeo. "I think when you're forced out of your comfort zone, you get out of that learning curve a lot quicker and it builds you up as a leader sooner," she told me.
I heard a similar story when interviewing the CEO of Restaurant Brands International, Daniel Schwartz, who became CEO of Burger King at 32 with little experience. And from former General Electric vice president Beth Comstock, who stepped into the role of chief marketing officer at General Electric despite never having read even a basic marketing book.
All of these guests recognized that taking a chance like this could end badly, of course, but they encouraged me to look for opportunities that I might initially be reluctant about.
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Alli Webb turned a hair salon project into Drybar, a thriving salon business with more than 100 locations across North America. She did this with the help of her designer husband, Cameron Webb, and her brother, Michael Landau, who works as a salesperson.
Seeing that his personal project became a business full of possibilities, he had to put aside certain responsibilities and take on new ones. Webb said the biggest breakthrough, at this point, had been to step back and focus on the tasks he was best at at that point in his career.
"If I'm being completely honest, there are times when I don't agree with the decisions that are made and that pill is very hard to take," she told me. "But you have to move on and learn from your mistakes: look back and say, 'You know, we should have done this differently, but we've come this far.' I think it's part of the learning and growing process."
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Ryan Serhant is not only the star of the popular US television show Million Dollar Listing, he is also one of America's most successful real estate agents. The manager noted that his team closed deals worth more than $800 million last year.
Serhant exudes confidence and has been instrumental in closing deals and landing important clients. But he told me that most of his life he had been clumsy and shy.
When he moved to New York after college, he went from struggling actor to real estate agent. One day he decided that he would do whatever it took to be a successful real estate agent.
"I was forced to develop a thicker skin, to come out of my shell and really try to create a personality that was comfortable talking to strangers, something that scared the hell out of me when I moved to New York"; he told me. "And I think that this ability to approach anyone who was on the street and ask their name and how they are, without feeling ashamed, helped me in my sales."
Business Insider/Jessica Tyler
Jocko Willink and Leif Babin are former Navy SEAL commanders and authors of The Leadership Dichotomy. They and their team have worked with 400 companies since they launched their leadership consultancy, Echelon Front, in 2010.
I was told two of the most common mistakes in new leaders, which are applicable to ambitious people who don't necessarily have to be in positions of power: they think they have to know everything from day one and they think their problems are unique .
Both of these issues are dangerous because not only can they lead to anxiety, but leaders begin to blame others when things don't go as planned, rather than accepting their circumstances and seeking help from those who have already faced the same challenges. .
I also had the chance to interview Willink for the podcast, and he shared with me an insight that sounds so simple but got me through the New York City Marathon in November after sustaining a painful injury at the 7km mark.
Navy training is tough, explains Willink [a famous US Navy SEAL turned podcaster], but there's nothing particularly deep about it. "If you're there, you have the physical ability to finish. But the reason most applicants fail the tests is because they quit when the pain or discomfort becomes something they don't want to tolerate."
"That's the great lesson. Don't give up," he summarizes.
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A few years ago, Larry Morrow was one of those people who dropped out of college to earn money from his party business. Now, he runs a New Orleans event-planning company with clients like Drake and Mary J. Blige, as well as a well-reviewed restaurant.
The 27-year-old entrepreneur told me it was all about relationships. "I've built a reputation for producing great events and taking care of people," he explained to me.
Ultimately, he was able to attract a client like Puff Daddy, for example, because of the way he treated his first clients, who might have been far from celebrities.
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There is a certain online influencer subculture that suggests that quitting your job and starting your own company is a change that can make anyone happier. But after countless conversations with entrepreneurs, I see that this is horrible advice and that the myth of "born entrepreneur" is closer to reality.
Eddy Lu, co-founder and CEO of high-end sneaker brand Goat, proved it to me.
Lu and his co-founder, Daishin Sugano, left their finance jobs to work in various app businesses before trying their hand at a cream franchise. All of them failed, and as the franchised business sank, Lu had "every kind of debt possible"; counted.
"I had debt on my credit card, with my ex-girlfriend, with my girlfriend at the time," Lu explained to me. "It was horrible. I'd wake up in the middle of the night just with guilt and I was terrified, yeah."
But like many other entrepreneurs I spoke to, Lu would rather live in that space, running his own business, than working for other people.
"To be honest, going back to a job at a big company would have been worse than that," he told me.
Jamie Cody
You may know Bethenny Frankel from her role on the reality show The Real Housewives of New York City. But what you may not know is that she has used it to build her $100 million Skinnygirl brand empire.
Frankel never set out to become a reality TV star, she told me, but she used it to her advantage as an entrepreneur. The best advice from her: don't waste time planning your career path because there's no way it's going to work, and if anything, it will prevent you from taking risks that could benefit you professionally."
"I'd rather be on the road, start the journey, get dirty and clean and take another road," he told me. "Getting stuck and finding a way to scale another path. You have to get going and figure out what you want to do, what value you add and what you don't."
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Adena Friedman started as an intern at Nasdaq in 1993 and, apart from a brief stint away from the company, spent nearly her entire career on the road to the top of the stock market.
She told me she had developed a simple mantra that she used as a guide: "Have I achieved everything I could have achieved with the skills I have? Have I brought my best self to work every day, like day one?" ".
Simple but effective.
Business Insider/Jessica Tyler
Stanley McChrystal, who retired with four stars as a US Army general in 2010, is remembered for revolutionizing the way the US conducts its special operations, leading to the assassination of Abu Musab al-Zarqawi, leader of Al Qaeda in Iraq.
In his book Leaders, McChrystal says we should stop idolizing leaders. Even when we don't like our leaders, we tend to put them on a pedestal, he explained to me, and that impedes progress.
"Leaders have their role, but followers also have an important role and a great responsibility," he said. "A lot of responsibility in doing their part but also in shaping the leader. You see the leader making a mistake and you don't tell him something? You fail at your job. And then when you see them fail you become conceited that says: ' If I never thought it was that good, it never was that good.' Shame on you.'"
Mike Blake/Reuters
Peter Diamandis is an entrepreneur known for his work in space exploration and for founding the X Prize Foundation.
He told me that when he witnessed the successful 2004 space flight that he supported with the X Prize, he felt he had helped fulfill more than a decade of work.
"And I remember that moment," he said, "I have a mental image of what was happening. The ship had just successfully gone into space against all odds, and it landed. And I felt like I was on top of a mountain that I was climbing for 11 years. I remember, when I looked around, all I saw were even higher mountain peaks. So you have to realize that it's the journey, not the destination, that's interesting."
Bryn Lennon/Getty Images
It's been a decade since the Great Recession caused inequality to become a common topic of discussion in the United States, and while the economy has done well this year, the gap between the top 1% and the rest of the country has widened. It is among the largest that have ever existed.
H.W. Brands, a historian at the University of Texas at Austin who wrote the book The American Colossus, said we are at a point that can reasonably be called a second Golden Age, a reference to the period between Reconstruction after the American Civil War. and the beginning of the Age of Progress, at the beginning of the 20th century.
Brands has a very useful metaphor to understand the reason for both periods. "The tension between capitalism and democracy has characterized American life for two centuries, with one and then the other claiming temporary dominance," she said.
He thinks that the only way we can emerge from this state of vast inequality is the same as in the past: through a big war or a mass adoption of progressive policies that reduce the power of big business and elites
"As long as people are free to defend their proposal, and as long as people are free to vote for or against it, then I think democracy can return," he said. "I think the pendulum swings and it can swing back."
BCG
Saying that large companies will make decisions for the benefit of society may sound good, but no one would make that decision if their profits were affected. They are not charities, after all.
But Wendy Woods, one of the senior partners at Boston Consulting Group, explained to me that they don't have to be. At this point in the United States, it makes sense for companies to embrace initiatives with environmental, social or governmental criteria.
"And I think all of the social impact allows us to get to a different point where we're told that it's not just about companies being a checkbook, it's about businesses looking for ways to make 'better capitalism' and ways to create shareholder value," he told me.
An in-depth BCG report, which assesses the effects of these environmental, social and governance initiatives, found that initiatives that had done so had improved their results more than those that had not. To give an obvious example of why this makes sense, sustainability programs not only benefit the environment, but also reduce costs.
B Lab
Jay Coen Gilbert, the co-founder of basketball apparel company AND1, found a way for companies to verify and advertise their dedication to socially conscious programs through B Corp status. With the B standing for Profit .
Coen Gilbert's company, B Lab, screens other companies applying for B Corp status and grants them accreditation if certain parameters are met in terms of how they benefit their workers, their customers, their communities, the environment and shareholders. To date there are 2,600 companies classified as B Corps in the world.
The North American subsidiary of Danone, one of the world's largest food companies, is the largest with B Corp certification. Danone CEO Emmanuel Faber told us that the certification has received tremendous support from his employees and had won against skeptical shareholders. In addition, he added that Danone's plan had helped renegotiate a 2 billion euro bank loan with 12 major banks at a lower cost.
"So this is basically acknowledging the fact that it is better for Danone to have a B Corp rating than not to have it," he said. For this reason, it has planned that all Danone will be certified in 2030.
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Steve Case, the co-founder and current CEO of AOL, is a leader of the "Rise of the Rest" movement, which includes an impressive network of the country's most influential investors and business people investing millions of dollars outside of Silicon Valley , New York and Boston, three areas that receive 75% of the venture capital.
"These are national and even global companies," Case told me of the companies he had invested in across the country. "They were just in Louisville, or they were in Chattanooga, but they shouldn't have regional ambitions, they can go further."
I explored a related project, albeit one with a smaller scope and larger financial scale, when I went to Detroit to see Quicker Loans founder Dan Gilbert and his $5.6 billion project that has transformed downtown from the city.
Amazon may have dominated the news cycle for weeks now, but you should expect to hear more and more stories about the development of American cities left to die in the age of deindustrialization.
Joshua Roberts/Reuters
At the beginning of the Great Depression, British economist John Maynard Jaynes published his groundbreaking book The General Theory of Employment, Interest, and Money. In it he differentiated between short-term and long-term value, noting that US markets were designed to promote the former over the latter, at the expense of society.
Economists who lobbied against Keynesian policies in the 1960s and 1970s, such as Milton Friedman, believed that trying to incorporate a social good into the company's mission was foolish and that the only way to truly benefit shareholders was to focus solely on in making decisions that create shareholder value, the rest would fall on deaf ears.
Friedman's ideas took hold in the 1980s, especially in the United States. They were further consolidated through judicial precedents that established shareholder primacy as the fiduciary responsibility of listed companies. There was a spike in investment activity. Nobel laureate Joseph Stiglitz told me that it all led to a toxic reign of short-termism.
He thinks the trend is moving away from Friedman's ideas, with leaders like BlackRock CEO Larry Fink saying he won't do business with companies that lack a clearly defined purpose beyond increasing shareholder value, driven by a survival instinct. GDP growth has been much slower in the last two decades than it was from the end of World War II until 2000.
It's an old debate about the role of business in the world, and the balance is shifting once again.
"As they say in the Bible, 'There is nothing new under the sun,'" Stiglitz told me with a laugh, "but today there is a new context."
