My Conversation with John Mackey, co-founder of Whole Foods Market | David Senra

Well, one of your themes that comes out in in listening to a lot of your is you admire entrepreneurs and you find one of the common threads for the successful entrepreneurs be those who are basically

fanatics. They just are into their

fanatics. They just are into their businesses. I was just listening to

businesses. I was just listening to Michael Dell. I mean, Michael, you know,

Michael Dell. I mean, Michael, you know, it's it's like he says, and even started off the episode by quoting him. He says,

"Well, how much time did you work?" And

he said, "All the time." all of the time. And that's a theme for oftentimes

time. And that's a theme for oftentimes for entrepreneurs that they are. So,

it's not like they're even think about working. Michael doesn't make a

working. Michael doesn't make a distinction, I don't think, between work and play. Neither do I. Because when

and play. Neither do I. Because when

you're really enjoying it, is it work? I

mean, it's you're doing what you want to do. And it's playful. So, it takes a lot

do. And it's playful. So, it takes a lot of time, but you're not thinking about it because you're loving every minute of it. You're enjoying it. That comes

it. You're enjoying it. That comes

through with the Todd Graves one as well, you know? I mean, he just loved his business so much. And so all these entrepreneurs, they're 100% in and that's where their time goes. They're

not, you ask Michael if he was kind of like a Renaissance man or if he was doing a lot of different things and it's like, no, no, not really. I think that's also true for most entrepreneurs.

They're pretty focused on a few things and mostly they're focused on their business.

>> Yeah. Yeah. To with the conversation we were just having >> before we started recording, which you know, I'm essentially seeking your counsel because I think I'm just like these kind of people. Like you wouldn't

spend 10 years making this podcast, reading 400 of these books. Your book

was excellent by the way, which we'll talk a lot about today. I wasn't

expecting to start here. If you didn't think that you were similar or there was something about them that was attractive and I feel like essentially my my entire life is my work. Now, I think one thing

that we share together and we we spent several hours uh together, too. It's

very obvious in your book, but also with you. You viewed yourself, I don't know

you. You viewed yourself, I don't know if you use this word, but to me, you're definitely a missionary. And one of the things I want to talk to you about, I talked to a lot of founders about this.

So, it's like a lot of co-founder conflict. And it's very obvious that

conflict. And it's very obvious that especially when you're a missionary, you weren't like, "Oh, I just want to like start, you know, one grocery store so people eat healthier and better food."

You're like, we're going to change the way that the country eats. And that was a very distinct philosophical mismatch from some of your early co-founders. Can

you talk a little bit about that?

>> I mean, the first one we started it up, it was kind of like thought it'd be fun.

We weren't trying to change the way America eats. We just wanted to open up

America eats. We just wanted to open up a small natural food store, a safer way.

And actually the good part of the book is dedicated to the early days because I think many entrepreneurs they remember the early startup part of the business very well and then they

remember the last few years and then there's a period in between they don't think about one of the good things about writing a memoir is like I got to

rethink it all relive it all and um yeah my original founders co-founders particularly one Mark he just wanted to make a lot of

And the very first store, the very first little food market is very profitable.

And even though the flood knocked it back, we got back on our feet. And it

was just very profitable. And he said, "We don't really need to do anything else. We've got it made. Let's just not

else. We've got it made. Let's just not screw it up." It's like, well, I don't want to do just one store. I want to open up more stores. And he went along with that. But those new stores started

with that. But those new stores started slow. Had to grow into it. And so there

slow. Had to grow into it. And so there even came a time where we were losing money again. And he was very angry about

money again. And he was very angry about it. He says, "You've you've you've blown

it. He says, "You've you've you've blown it." And I said, "No, these stores are

it." And I said, "No, these stores are going to be fine. They're going to grow.

You wait and see." But he didn't have the patience to do that. It's like you you plant a seed. You can't be digging around. You got to let it grow. You got

around. You got to let it grow. You got

to give it time to seed to germinate and turn into something. So, you have to be patient. It's sort of like investing.

patient. It's sort of like investing.

You have to let it compound over many years. Well, you have to let a business

years. Well, you have to let a business compound over many years as well. So the

missionary part was as we began to grow, I began to realize nobody's really doing quite what Whole Foods is doing. Nobody

quite has the vision that we have that I had to to be a national company to to maybe change our agricultural system, maybe be able to help people to eat healthier. I could see what was

healthier. I could see what was happening simultaneously uh with Whole Foods growth. America was

getting sicker and sicker. That's the

paradox. It almost tracks perfectly where we see I I mean David 74% of Americans are

overweight and 43% are obese and that has not peaked. It is still going up. Um

and it's it's a this and you can see it now with Make America Healthy Again that people are beginning to respond to the fact that we are literally killing ourselves through what we're eating.

>> The co-founder that had the philosoph philosophical mismatch, one of them, was that the same one that you guys bought out? Was it Mark that you bought out

out? Was it Mark that you bought out early in?

>> Yes, Mark. That's right. Mark, the other co-founder was with me. I mean I mean he he he was Mark's partner originally, Craig. But Craig really had a larger

Craig. But Craig really had a larger vision. Craig really wanted to grow the

vision. Craig really wanted to grow the business. He really I remember I I don't

business. He really I remember I I don't know if I told it in the book or not, but I think I think I might have mentioned it. But one day early on, we

mentioned it. But one day early on, we were we were starting to grow. We were

starting went to California and Craig said, "John, we're going to be everywhere. We're going to be everywhere

everywhere. We're going to be everywhere in America. Can you believe this? we're

in America. Can you believe this? we're

going to have Whole Foods Markets everywhere. He says, "I'll bet someday.

everywhere. He says, "I'll bet someday.

I'll bet someday we have a store in Kansas City for for for Craig. Kansas

City was like the last place we'd have a store, but he thought, we'll get there someday." And I remember I think Craig

someday." And I remember I think Craig had retired by the time we we finally got to Kansas City, but I remember uh calling him up and saying, "Craig, we've done it. We're we're to Kansas City,

done it. We're we're to Kansas City, dude. We made it." [laughter]

dude. We made it." [laughter]

>> There's a lot of things that I I I mentioned this in the founders episode I made about you. Uh, I was not expecting because you're you're hilarious in the book by the way where it starts you're like, you know, I'm like this shirtless hitchhiking hippie like I just dropped

out of college. I'm looking for like my life's mission like what I want to do for work. And so you wouldn't think like

for work. And so you wouldn't think like a shirtless, you know, hitchhiking hippie, there'd be a lot of parallels between you and uh Johnny Rockefeller, but there definitely is. And

specifically in the early days of his career where there was a commitment mismatch between him and his original co-founders wind up >> wind up he bought them out. He said the day that he got rid of those partners

was he looks back as one of the smartest and best decisions of his life. You were

constantly ex wanting to expand expand expand. I wanted to ask you that's the

expand. I wanted to ask you that's the next question I'm going to ask you from the very first like from the very early days of safer way and then what turns into to Whole Foods and your partners were kind of like kind of put trying to

put the reins and like pull you back, >> right?

>> Can you like talk us through that time of your life?

>> I just had a lot of confidence. I think

I think a lot of entrepreneurs, not that we weren't making mistakes, I just I think entrepreneurs believe, okay, I I got this from listening to the Michael Dell one on on the drive out here, in fact, is that Michael said,

"Well, you you got to make mistakes.

That's how you learn. That's how you you iterate." Entrepreneurs have confidence

iterate." Entrepreneurs have confidence that they will solve the problems. Michael likes to figure out puzzles, right? Well, business in some way is a

right? Well, business in some way is a puzzle. It's like, and I'm doing it

puzzle. It's like, and I'm doing it again with love life. It's like, okay, what does the market really want here?

and okay, this isn't working. We got to do less of that. This is working. Let's

do more of that. And then and then you you're constantly trying to think about how to create more value for your customers in ways that they don't necessarily even know they need it. So

the entrepreneur has confidence that he or she will figure it out, crack the code, solve the puzzle. And so they're willing to go ahead even though they

don't know for certain because they're what they do believe is they're figuring it out. They're going to figure it out.

it out. They're going to figure it out.

And um people that I think my co-founders, they weren't sure we would be able to figure it out. So they and they didn't want to blow it. They didn't

they want to play it safe. They didn't

want to lose what they had, I think. And

I was like, we're going to I didn't failure wasn't an option. I mean, I just think entrepreneurs have great confidence in their ability to solve the problems and they will figure it out and

win. And I think I fell into that

win. And I think I fell into that category looking backwards.

>> Why did you understand though that you had to expand or you weren't going to succeed where they thought, okay, we can just stay with this like nice old story >> just because the world constantly that that Whole Foods had no patents. We were

just a grocery store retailer. Anybody

could see what we're doing. anybody

could copy what we were doing. I was

amazed. I always like to make the joke that Whole Foods flew under the radar.

The supermarkets never took us seriously for decades. It wasn't until we opened

for decades. It wasn't until we opened up in Columbus Circle in New York City.

The media never paid any attention to us either. We opened up in Times, you know,

either. We opened up in Times, you know, not Times Square, we opened up in in uh Columbus Circle and the this the biggest supermarket in New York and it just and

it was in a basement. I mean, I think I talk in the book about how difficult the decision that was because of the capital investment. No parking in a basement.

investment. No parking in a basement.

It's like we're bound to fail. But we

took the risk and that store was still the highest line store at Whole Foods.

Even though it's got some challengers now, it's it's ever since we opened it, just took off. And then the supermarkets discovered us, they started to take us more seriously as a competitor because

of all the publicity we received. And

they had to go see that store. And then

the media started to pay attention to us as well. And as the media gave us more

as well. And as the media gave us more attention, more people began to buy the stock. And so we had this, you know,

stock. And so we had this, you know, upward spiral of success.

And one of the things is is that we can't patent anything. We don't have anybody can see what you're doing and they can and they it's easy to get your intellectual capital. Just hire away

intellectual capital. Just hire away some key employees. And we were Whole Foods was fortunate because we never were taken seriously by the supermarkets until we really developed scale on our

own. I think I tell the story of a of a

own. I think I tell the story of a of a venture capitalist who who didn't invest and his basic argument was, well, I don't think it's a big market. You're

just a bunch of hippies selling food to other hippies. But then if I'm wrong,

other hippies. But then if I'm wrong, uh, these other big supermarket chains will put you out of business. You can't

compete with Safeway or HB or those guys. And he might have been right

guys. And he might have been right except that they didn't pay any attention to us. So we kept doing what they were they were hypnotized by Walmart. They were so scared about

Walmart. They were so scared about Walmart that they ignored us.

>> This is one of the most surprising things. I want to go back to the venture

things. I want to go back to the venture capitalist. I'm going to handle the

capitalist. I'm going to handle the venture capitalist first and then I want to go to Walmart because we talked about this when we had dinner. But in the book that was one of the most shocking things. We're like actually Walmart

things. We're like actually Walmart played a huge role in our success and I didn't even put it together uh before that. You call venture capitalists

that. You call venture capitalists hitchhikers with credit cards [laughter] in the book. you do not hide your disdain for them in general. Can you

explain why like you call them hitchhikers or credit cards and like recount some of the experiences that you had with them in the early days?

>> I mean, first of all, I'm glad we got venture capital money. Um, they I don't know if we could have grown without it.

We didn't get very much, but it was enough to get us into Northern California. And then and then after

California. And then and then after that, we we four years after we got the money from them, we were public. So they

they were important for us to get to where we got to. Once we had the public money, we didn't need those hitchhikers any longer. And they got out of the car.

any longer. And they got out of the car.

And I tell entrepreneurs this all the time. The VCs are playing a different

time. The VCs are playing a different kind of game. The game VCs are playing is is that it's kind of a blockbuster model. They're looking for exponential

model. They're looking for exponential growth. And when they hit when you get

growth. And when they hit when you get an Apple or you get a Nvidia or an Intuitive Surgical or you get one of

these companies that just compounds and compounds and compounds, you can get 100x your venture capital money and that's what they're looking for. And so

what ends up happening is they often times take good businesses and try to scale them too rapidly because they're trying to get that exponential payoff.

Remember, they've usually got these funds where the money is only going to be in that, you know, seven years. They

got to start paying back. So, the

entrepreneurs, they're not evergreen funds where you can keep the money in, you know, for decades. They pressure the entrepreneur to try to scale rapidly and

that works for some businesses and those are happy endings. But a lot of times you take a perfectly good business that that's not going to be, you know, a multi-billion dollar business that's

going to change the world, but it's still a good business and they wreck it.

But they can afford a lot of failures because of the blockbusters make so much money. So it's it's it's like a batting

money. So it's it's it's like a batting average. They they don't have to hit a

average. They they don't have to hit a thousand. They just need to hit good

thousand. They just need to hit good enough and the blockbusters are home runs and so they make a lot of money on that. So, I'm often telling

that. So, I'm often telling entrepreneurs that be careful with the VCs because the first thing they're thinking is they want to scale your business and they're going to tell you, "Don't worry about your burn rate. We'll

do another round of financing at a higher level and a higher level and a higher level." But what often happens

higher level." But what often happens down that road is that um the business doesn't scale as well as they want it to. And then you get the round where

to. And then you get the round where it's kind of a crammed down round where it's a down round and the the the entrepreneurs

share is diluted way down in those down rounds or they get rid of the entrepreneur and bring professional management in and they throw them out on the side of the road. I always tell young entrepreneurs don't give up control of your business to the VCs.

They may talk a good game but they're not fundamentally aligned with you. I

think for most entrepreneurs, you really want to build a business and you probably want to be here a decade now or 15 or 20 years from now still growing your business. And if that's the case,

your business. And if that's the case, you have to be very careful about the VCs because they that's not what they want. They have seven years. They want

want. They have seven years. They want

100x return if they can get it and they're prepared to crash your business prematurely if that's what it it takes.

So, so be careful. That's that's my main main thing I tell How do the younger entrepreneurs that you're advising usually respond to that advice?

>> Well, for one thing, most of them don't care. Uh because I think you're a

care. Uh because I think you're a builder. Michael Dell's a lot of these

builder. Michael Dell's a lot of these entrepreneurs you're talking about, these iconic entrepreneurs, they're builder entrepreneurs, but that's not the most common entrepreneur. Those are

ones you get the biographies about, but the most common entrepreneur is a serial entrepreneur. They just start businesses

entrepreneur. They just start businesses and they do them for five years and flip them. They're they're like somebody

them. They're they're like somebody remodeling a house and then flipping it.

Except these cases, they're really creative. They're good at germinating

creative. They're good at germinating things. They don't want to operate them.

things. They don't want to operate them.

They don't want to really build them over the long run. And so they're okay with that trying to scale it because they're not going to be around anyway.

They want a rich exit. That's more

common than you realize.

>> I think I now am realizing that and I have for several years. I actually, it's funny. I just thought about this story

funny. I just thought about this story this morning. Um, and I think this is

this morning. Um, and I think this is actually a really important point that I remember a few years ago having dinner with a founder. And the weird thing is I had never met him. He was a fan of the

podcast. And but I'm like, I don't know

podcast. And but I'm like, I don't know if this guy's actually listening to the the podcast because he wanted to talk about like the watch he has and the car he's driving. And I found out he was

he's driving. And I found out he was selling a ton of like secondary before his company was successful at all. And

it just came out yesterday, the day before, that this company that had a $2 billion valuation in like 2022 or 2021, whenever I was having dinner with them, uh, last year they did 7 million in revenue.

>> Wow.

>> And they had $47 million of expenses.

And I'm like, oh, you're just this guy this that sign. I was like, I don't give a [ __ ] about the car you have or the watch you have. I care about what you build, not consume. you should be proud

of what you have built, not that you bought you have money to buy somebody else's product. Like that doesn't

else's product. Like that doesn't impress me. And I obviously I left the

impress me. And I obviously I left the dinner, never saw him again. And I

[laughter] kind of forgot about him until yesterday. I'm like, "Oh, this I

until yesterday. I'm like, "Oh, this I spent." And I was like, "You idiot,

spent." And I was like, "You idiot, David. You have like one of the benefits

David. You have like one of the benefits of reading a book like yours or any of these biographies like you get to the end of the story and you just you're reminded that you know our life, you come to the end of the book, our life,

we have limited time here and you should be ruthless with how you're spending your time." And I just gave two hours to

your time." And I just gave two hours to this guy that was not even a B player.

He's F. You've done nothing. You [ __ ] joker. Like this is useless for me to

joker. Like this is useless for me to spend any time with you. And this is why I people think I'm a little crazy where I spend almost all my time with people that have I said in the episode people like you where Michael Dell, Todd

Graves, I'm obsessed with people that do things for a long time because time is the only filter that I trust. I have no idea, no predictability that this entrepreneur that started a company today is going to be successful. We're

going to see and it's going to be up to them in the decisions that they make.

And so I am kind of drawn to these like more missionary founders because you just make better longer term decisions.

So, I'm not sure he he was a typical uh serial entrepreneur because a lot of serial entrepreneurs that I know, I know a bunch of them and they do care about their businesses and for them it's more

it's more they have they have a certain skill set of creating businesses and then getting them to a certain level and they're not primarily about the money

for them. The fun part is creating the

for them. The fun part is creating the business and then as you start to staff it up and you build a bureaucracy, they're they feel trapped by their own creations in a way. They're just they're

not wired to fit within that kind of corporate structure that they're creating. And all businesses eventually

creating. And all businesses eventually evolve to or almost all businesses eventually evolve to if they get any scale. They just don't like that. So

scale. They just don't like that. So

they start over again. But I think those people are very interesting people. I

think many serial entrepreneurs are not simply shallow people in it just for the money. I have some good close friends

money. I have some good close friends who made a lot of money creating different businesses that u but only like one of my good friends in Austin, a guy named Brett Hurt. He was the he he

co-founded three public companies. uh

his most famous one was Bizaarrevoice which does uh all did all the if you do a review on an online business you're probably using Bizaarre voice technology

and uh Brett is just he said well I just love creating businesses and and uh but after after I've done it for I don't know five or six years I just get bored with it and I want to create something new.

>> Yeah, I don't have any problem with that. Like I mean the whole point of

that. Like I mean the whole point of being an entrepreneur is you get to decide what you work on who's around you. Like that's one of the the biggest

you. Like that's one of the the biggest choice.

>> Brett Brett would never be bragging about any of his cars he drives or you know his wealth. It was just not he just wouldn't do that.

>> Before having this conversation with John Mackey, I got to spend seven hours with him over two days. And it was during one of our conversations that John Mackey told me one of the craziest things that anyone has ever said about

Founders Podcast. He had listened to

Founders Podcast. He had listened to over a hundred episodes before we met.

And he told me that if Founders Podcast existed when he was younger that Whole Foods would still be an independent company. That since the podcast and all

company. That since the podcast and all of history's greatest entrepreneurs constantly emphasize the importance of controlling expenses, he would have put a much higher priority on it, especially

during good times. During boom times, it is very natural for a company and for human nature to not watch your costs as closely because everything is going so well. Andrew Carnegie would repeat this

well. Andrew Carnegie would repeat this mantra time and time again. Profits and

prices are cyclical subject to any number of transient forces of the marketplace. Costs, however, could be

marketplace. Costs, however, could be strictly controlled. And in Carnegiey's

strictly controlled. And in Carnegiey's view, any savings achieved in the cost of goods were permanent. This is

something I was talking about with my friend Eric, who's the co-founder and CEO of RAMP. RAMP is the presenting sponsor of this podcast. I've gotten to know all the co-founders of RAMP and has spent a ton of time with them over the last two years. They all listen to the

podcast and they've picked up on the fact that the main theme is on the importance of watching your costs and controlling your spend and how doing so can give you a massive competitive advantage. That is a main theme for

advantage. That is a main theme for RAMP. The reason that RAMP exists is to

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episode you're currently listening to, there's a shocking idea that John Mackey told me about. And it has to do with the role that Walmart played in Whole Foods success. And it has to do with how

success. And it has to do with how impossible it was for other people to compete with Sam Walton and Walmart. In

his autobiography, Sam Walton wrote this. Our money was made by controlling

this. Our money was made by controlling expenses. You can make a lot of

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Let's go back to the role that Walmart played in Whole Food success, which is a very interesting part of your book.

>> Well, it was it was sort of a if I was using a metaphor, it's kind of like uh we were using a football metaphor. It's

kind of like Walmart was such a massive force. They they created everybody all

force. They they created everybody all the supermarkets. Remember Walmart

the supermarkets. Remember Walmart started out they didn't sell food. They

were they were you know Sam Walton you read his book probably 10 times and and Sam you know he started out in kind of in the five and and dime store and that was kind of his initial model. I

remember he would had his big idea to do the bigger general merchandise store and he couldn't sell it to where to the Ben Franklin the Ben Franklin. So he just went out and did it on his own. And it

was only later after they s Walmart was very successful growing and they were competing with Gibson's and companies like that uh Kmart that they started thinking about food. But when they put

groceries in it so disrupted the conventional supermarket industry that all they wanted to do was um figure out how to compete with Walmart.

So the existing grocery stores saw the competition from Walmart and they made the drastic mistake of trying to compete on price. Yes. With the lowcost

on price. Yes. With the lowcost provider.

>> Correct. And so they they tried to cut their cost. They and they spent less

their cost. They and they spent less money in building out their boxes. They

looked more like warehouses. They were

more sterile. They went with cheap lighting. Everything, you know,

lighting. Everything, you know, everything to to cut their capital investments down. Then they cut their

investments down. Then they cut their labor to the bone. They had a lot of them had unions. So they had to but so they cut by cut service back and uh they still couldn't compete with Walmart. We

had playing Walmart's game with Whole Foods. We just were going this different

Foods. We just were going this different direction. We like we can't compete with

direction. We like we can't compete with Walmart in price. We're not even going to try to. We're we're going to compete on quality. We're going to compete on

on quality. We're going to compete on service. We're going to have

service. We're going to have differentiated product mix. And so

that's what we did. As that one venture capital said, you're a bunch of hippies selling food to other hippies. That's

true. It was true at one point. We were

definitely fooded for younger generation of more healthconscious people. But what

ended up happening is is that as those supermarkets made their stores less attractive, we'll say to um middle class, upper middle class women who do

mo do most of the food shopping. They

wanted to come into a store that was pretty, was beautiful, that was people that gave them good service, that took their groceries to their car, that was nice to them, that answered their

questions, and they didn't get the products that Whole Foods sold, but what they got was our produce was beautiful and it tasted good. And these people were really nice to us, even though they

had piercings and tattoos and they didn't look like, but they looked like their children actually. So they were more sympathetic to it than you might think. And so we cracked that we crack

think. And so we cracked that we crack kind of cracked that upper middle class next that bought our food for the quality and the service. And then as

that happened, we began to grow faster.

Our comps went up. We were not just in our own little sort of hippie hippieville any longer. Uh and the supermarkets didn't pick it up and again until we got to really didn't pick it up.

>> So they were ignoring you.

>> They were ignoring us. It was like, using my football metaphor coming back, Walmart was like this giant uh distraction and we were running downfield wide open for the touchdown pass. They were so obsessed with

pass. They were so obsessed with stopping Walmart that it allowed Whole Foods to to compete on a different different framework, a different different competitive strategy. The

supermarkets only competed for the longest time, they only competed on price really. They just, you know, they

price really. They just, you know, they had nice stores with music in it and they never, but they were all trying to compete on price and Walmart was the killer app, so to speak, and they were

trying to, that's all they knew how to do is compete on that. So, Whole Foods created a different business model. Once

they figured it out, it became a lot tougher competition for us. They started

copying us. They started making nicer stores, putting a bigger emphasis on their perishable foods like produce, um, competing with us on price instead of Walmart on price. How many years did they give you the run of the field?

>> That's the great question. I'd say we got the run of the field. We opened up uh the first Whole Foods was 1980 say for 1978 and uh we didn't open up it was

2004 we opened up Columbus Circle. So

think about that. We had you know 20 20 to 25 years where nobody paid any attention to us. And that allowed us to scale and compound and they just dismissed us. They just thought who

dismissed us. They just thought who cares about Whole Food? They don't hurt us. We never hurt any one supermarket

us. We never hurt any one supermarket that much. In fact, we'd come into a new

that much. In fact, we'd come into a new market and they would be all they'd compete initially. They'd try to lower

compete initially. They'd try to lower prices, get some of our products, but then their sales didn't drop very much because Whole Foods would take a little bit from a lot of different groceries.

We wouldn't take much from any particular one. So, as a result, they

particular one. So, as a result, they just thought they're not we don't have any problem competing with Whole Foods.

They they ignored us.

>> What was going on there? I don't

understand how you would take a little bit from, you know, let's say five of the other grocery stores in the areas.

>> Well, because we weren't we were so differentiated. We would take only a few

differentiated. We would take only a few of their customers. Not not most of their customers didn't switch over. Just

some of them did. A few did, but a few switched over from a lot of different places. And in the early days when we

places. And in the early days when we were the only natural food supermarket maybe for 50 miles around, we had a lot of people that would drive in on the weekends and stock up and they'd buy, you know, 300, $400 worth of groceries.

>> How far were they driving to get to you?

>> Oh, I mean sometimes 100 miles. When we

only had one store in a market area, uh people might come in. And they wouldn't I mean it's not their everyday shop, right? They'd come in, they couldn't get

right? They'd come in, they couldn't get this food anywhere else. They didn't

have what Whole Foods was selling at at typical supermarkets. In the day, in the

typical supermarkets. In the day, in the day, we were so unique. I always say, David, the first 20 years we existed, when people would first walk into Whole Foods Market, you could see I'd see it I'd see it again and again and again.

Their jaw would drop. It was like, I've never been in a store like this. This

I've never seen a store like this. Now,

people don't have that feeling because it's more common. And supermarkets have up their game. But for a long time, at least 20 years, people we just were blown away the first time they came into Whole Foods Market. They'd never seen a

store like that. It was so different than any other supermarket they'd ever been in. So we were very well

been in. So we were very well differentiated. We were in a niche and

differentiated. We were in a niche and people did not compete with us in that niche. And so we sort of owned it. But

niche. And so we sort of owned it. But

as I said, retailers don't have patents.

We couldn't patent a natural food supermarket. We couldn't patent our

supermarket. We couldn't patent our product mix. We couldn't patent our

product mix. We couldn't patent our marketing. we couldn't patent our

marketing. we couldn't patent our service levels >> and so scale was your solution to that.

>> Well, as we scaled, we could get we could get better pricing as well. So,

>> that was one of the craziest stories in the book that again I've been shopping at Whole Foods forever. I never for some reason never thought about like the creation. I just figured, oh, he started

creation. I just figured, oh, he started the first Whole Foods and the second and doing it for 40 years and that's how it happened. I had no idea that how much

happened. I had no idea that how much you grew by acquisition. The

acquisitions were key because they created a plat a geographical platform for us to go into a new geography and

create a team of people is very expensive. We did it a few times. We did

expensive. We did it a few times. We did

it we started in Texas. We did it in Northern California. We did it in

Northern California. We did it in Chicago.

We did it in Northern California. But

most of the other regions like Los Angeles, Boston, Washington DC, Florida, North Carolina, we got our

platform by an acquisition. We bought

out an existing company. Didn't means we didn't get many stores. We might have gotten, you know, I think we got six stores in Boston and seven in LA and two

in Florida, but that was still enough to create the platform. And from there, with that platform in place, with already support there and good and and and good intellectual capital, people

that knew what they were doing, we were able to grow faster. But if you look at Whole, let's say Whole Foods does 550 stores right now, probably of those that were stores that were acquired that

still exist and weren't relocated, maybe 25.

>> So the acquisitions were happening earlier in the company history.

>> Yes. Earlier. and they created a platform, a geographical platform that allowed us to expand out from that platform uh in a sense open new stores in that area.

>> This is again one of my favorite parts of the book and I think I want to spend some time here if you don't mind. Again,

Rockefeller did this exact same thing. I

mentioned it in the founders episode I did on you where he had this thing called secret allies that I think is one of my favorite ideas I've ever come across in any of these books. He's at

the very beginning of their finding industry. You're at the very beginning

industry. You're at the very beginning of the natural foods, you know, industry. doesn't really exist,

industry. doesn't really exist, >> right?

>> Uh you are by far the most ambitious and I called you in the episode like oh like I should have known this. Anybody that's

going to start in a new industry and come out at built the category defining company in that industry of course they have this huge ambition. They're

essentially a conqueror is the way I think about you even though I think a lot of people would uh not come ac come away with that same conclusion because of how like you know the hippie nature that you started with. So you what you

do is very smart. You do exactly what Rockler did. He's like you looked

Rockler did. He's like you looked around. It's like well I'm doing this

around. It's like well I'm doing this thing. Who else? Let me look around. Not

thing. Who else? Let me look around. Not

just in my area. Who else is doing the same thing and in some cases you find out about these in like trade journals and then you don't just like oh that's interesting. No you get on a plane and

interesting. No you get on a plane and you go there and you start building a relationship. You you built a network

relationship. You you built a network right? Was it an official network? Was

right? Was it an official network? Was

this unofficial?

>> No we had a name for it. It's called the natural foods natural foods network.

>> Talk about this. This is phenomenal. In

some ways, the natural foods industry, natural organic foods industry came out of the health food industry. The health

food industry started earlier, but it's mostly selling is mostly what we call pill shops. They're mostly selling

pill shops. They're mostly selling supplements um and some packaged uh you whole grains and whole whole grain flowers and things like that. But mostly

most of their sales came from supplements and and but that's kind of where the industry grew out of you know think about Jack Lane and he was back in the health food day and he was a health

food champion >> this like 70s what you what >> we're talking the early health food industry was probably after World War II and and you didn't until you until the

until my generation kind of came of age in the late 60s and early 70s you begin to see start natural food stores start to pop up that we're primarily food rather than supplements. And there came

a point where we realized we're not really health food stores in the old traditional sense. We're different.

traditional sense. We're different.

We're natural food stores. Then the next iteration was what if we did a store that was a complete one-stop shop for people living this lifestyle so that we were a supermarket, a natural food

supermarket.

When when whole food started, there were only like three or four other natural food supermarkets in the United States.

There was like Bread and Circus in Boston. There was Mrs. Gucces in LA.

Boston. There was Mrs. Gucces in LA.

There was Fraser Farms in San Diego. Um,

that's about it. I mean, there were some smaller stores, but they weren't. You

got to be at least 10,000 square feet to be a natural food supermarket in my mind. And [clears throat] so, we opened

mind. And [clears throat] so, we opened up. I heard about those in the natural

up. I heard about those in the natural feeds merchandiser and went and studied them and thought I remember it was pivotal. It was like I could go and tell

pivotal. It was like I could go and tell the investors, hey, I didn't invent this. There are other people doing it.

this. There are other people doing it.

It's working in LA. It's working in Boston. It's working in San Diego.

Boston. It's working in San Diego.

Why won't it work in Austin? It'll work

in Austin. Let's try it. Otherwise, I

may not have been able to get the money if I didn't have at least a few prototypes already working. went and

studied them, became friends with them, and uh ultimately acquired all of them.

And [laughter] >> you jumped where I was going.

>> But there were there were others that were opening up about the same time like like Alalfa's in uh in Boulder, Whole

Food Company in New Orleans, um um Unicorn Village in Miami. There were

there were others that were forming about the same time. That was an idea whose time had come. But what was the initial instinct? The initial instinct

initial instinct? The initial instinct is these people are doing what I'm doing. Let me go build relationships

doing. Let me go build relationships with them. And then you realize, oh,

with them. And then you realize, oh, there there's a mismatch of ambition here and I can actually acquire them because they didn't want to expand.

>> You're giving me too much credit there.

>> But Mrs. Gues, I remember that one because that was instrumental at the time. I think you guys were only selling

time. I think you guys were only selling like you weren't selling like there wasn't a butcher. There was some kind of that you were doing like$8 to $10,000 a week. And

week. And >> that was a safer way.

>> Okay. A safer way to $10,000 a week or something like that. They were doing like hundred,000. And you're like, "Oh,

like hundred,000. And you're like, "Oh, that kind of opened your eyes that you could add the other product category."

Correct.

>> Bingo.

>> Okay.

>> Mrs. Gucces was a huge influence early on because it's like, "Wow, they're doing 10 times as much sales as we're doing." And their stores are a little

doing." And their stores are a little bit bigger, but they're not that much bigger, but they're selling they're selling fresh meat and they've got big produce departments and and so it's like that's what we need to do, too. We can't

do it a safer way. It's too small. We

need a bigger location. What ended up happening, I think of it this way. We

were all We were all missionaries in a way. We really believe natural we saw

way. We really believe natural we saw what was happening with the processed food industry that it was basically poisoning people. People were eating

poisoning people. People were eating this terrible food uh eating junk food diets and we thought we need to so we were sort of like Puritans in a way. We

wanted to create a this really natural organic revolution could change the world. That's what we and other people

world. That's what we and other people that were our colleagues they were missionaries too. They they were doing

missionaries too. They they were doing it because they really believed in it.

And so initially we created the natural foods network because we were we were helping each other. We were we would get together and we'd bring our financial statements and we trade them. We we

didn't see ourselves as competitors. We

each had our own geographical niche and by by exchanging information and financial information. This was making

financial information. This was making us all better retailers. It was sort of like a it was a club. And and then we I we used to do trips together too. I we

called it uh we did some people that were in the industry, not just retailers, but we'd call we had a wild man's group. We did some adventures

man's group. We did some adventures together in Alaska, in Yoseimity, >> not work related. This is just friendship. Yes.

friendship. Yes.

>> Building friendship, >> building relationships and having adventures together.

>> You would also, wouldn't you guys also travel to other stores together and do store visits as a group?

>> Yes. But what we do is we'd come together in a city. There'd be a host company hosting usually around a new store. We've opened up a new story. You

store. We've opened up a new story. You

got to see it. And so like when we hosted in Houston, we opened up our first natural food store in Houston in 1984, we hosted the natural foods network meeting in Houston. Um that

became one of the highest volume stores in in the natural foods world. And

within a couple of years, >> was this like a collective or do you you felt you were like kind of the leader of this organization? the guy that

this organization? the guy that organized the natural foods network in the book and I credit him in the book as a man named Peter Roy who was a natural

networker and Peter he started uh whole food company in New Orleans which we bought out and acquired that in 1988 and then Peter came on and helped us start

nor start Northern California. He

eventually became president of Whole Foods for five years and he left us back in 1998.

Um I I do some detail on that in the book. And so he was instrumental. He

book. And so he was instrumental. He

worked for us for 10 years and Peter brought the network together and he he helped one of the first acquisitions we did uh after Peter was

we and it was key before we went public.

We acquired Wellspring Growthy in North Carolina. Lex Alexander and Peter were

Carolina. Lex Alexander and Peter were like best friends. So Peter said John's a good guy. We're going to take good care of the business. We're going to grow it. you're going to get a big

grow it. you're going to get a big paycheck because we needed to go public to because I didn't want the VCs to get control of the business. I needed

>> You said they were trying to dra grab the steering wheel sometimes.

>> We the founding investors still had a majority of the stock. The VCs own 34%.

But if we'd done another round, they would have gotten control of the business and they they had different agendas. There's a great story in the

agendas. There's a great story in the book because your dad, which we'll get to, plays a huge role in your life and in in the company and there's like you guys have this like knockdown dragout fight and then he pulls you into a room

with with the VCs after. He pulls you into room like we need to get rid of these guys as soon as possible.

>> Yeah. Uh he just said they're want to take over the company. Let's get them out. Let's get them out of the car.

out. Let's get them out of the car.

>> Let's get them out of the car.

[laughter] Um he used more choice language about it than that. That

than that. That >> Let's go back to this network though. So

you're you're you guys are >> so we're developing all these relationships with these guys. What

ended up happening is I did have an ambition to grow the business. Most of

them wanted to stay and when I went to Northern California that that was the first rupture in the natural foods network because we'd gone out of our state and Mrs. Gucci felt like

California was theirs. I think I said gosh LA is yours. You're there but nobody's in Northern California. That's

400 years that's 400 miles away. It's

like, you know, you never said you even want had any ambition there. And they

said, well, we don't, but we didn't think, you know, we would get there eventually and now you've gone there.

So, that kind of was beginning to break up the natural foods network. We were

stopped sharing financial information.

There was we Whole Foods sort of created some fear in some of these other entrepreneurs that we were maybe going to come into their territories. I kept

saying, "No, guys, we're not going to compete with you head on."

>> No, I mean I [laughter] No, seriously.

>> What do you mean you're not going to compete with them head on? There there

were markets that we stayed out of for years. Uh

years. Uh >> and then what happened?

>> Well, then we bought them. [laughter]

>> But but but you see that's a different thing.

>> John, John, you have [laughter] come on.

You have this this you are unbelievably humble and I don't think that's an act.

Uh but you also are this like ruthlessly competitive conqueror. Like you admit to

competitive conqueror. Like you admit to how competitive you are in the book.

>> Yes. However, but the point is is that these were my friends and I did not want to hurt my friends. Okay? So, I never hurt Mrs. Guches. They didn't hurt them.

I mean, maybe it lessened their upward potential someday if they gotten there in 10 years or where somebody else would have gotten there before them as slow as they were going. But I didn't compete directly with anybody else's stores

ever. I didn't I never did it. I didn't

ever. I didn't I never did it. I didn't

go to Portland for that reason because of Nature's was there. I didn't go to uh Boulder until Alphas and and Wild Oats had sort of partnered up and uh so the

people that I developed those relationships with, we could pick where we went and and uh now they were scared we were going to come. But

>> why would they be scared of you? What

were they seeing in you?

>> Well, Whole Foods got out ahead. We

raised the VC money and once we went public in '92, that was a big event because now we had this currency and all we could the entrepreneurs could cash out and make millions and millions of dollars.

>> The entrepreneurs, you mean the VCs?

Okay.

>> No, I'm talking about >> Oh, the the network entrepreneurs and they all did. What what ended up happening is is they they had no how

could they get liquidity? I mean, the reality for most businesses is they're never going to be big enough. They

either have to sell the to get liquidity, they have to sell the business because most of them can't go public. And well, how else can you get

public. And well, how else can you get liquidity? Either you're going to either

liquidity? Either you're going to either have an IPO or you're going to have a sale. So, most of them saw the writing

sale. So, most of them saw the writing on the wall. Whole Foods was expanding and they should they should, you know, they should cash out. Most of them came to us and said, "Would you be interested

in buying us?" that like once we bought Wellspring and then particularly once we bought Bread and Circus and that was you know what we paid for was public and they thought my god we ended up paying I

think Anthony end up well we paid him 28 million but he ended up getting 30 million because he had to there was a lag period between before we could cash the stock out for him and it was worth more after we did it uh when we did our

secondary offering and so they were like wow I didn't realize my business was worth this much money and so they came to us the Terry uh Dalton in in Florida

said, "Buy me. Let's Why don't you come to Florida? We we we're great." And so

to Florida? We we we're great." And so we did buy him. Uh and and so that's that's kind of how it happened. We were

they trusted me. They knew we were going to take care of their business, too. We

weren't going to, you know, we were going to love their business and and make it better. Actually, most of them saw what Whole Foods was doing, and they admired us. They envied us partly, but

admired us. They envied us partly, but they also admired us. and they knew if they sold out that we were going to take care of their team members and and that we were going to maintain our standards of we weren't going to turn it into a

sup a regular supermarket and and that they they felt good about that.

>> Win-winwin.

>> I want to go back to your competitive drive because I do want to talk about that because I think it surprised a lot of people. My question though, I want to

of people. My question though, I want to know from your perspective and like your mind. Okay. Because I do the exact same

mind. Okay. Because I do the exact same thing now where I go around and podcasting is not it's like very positive song. There's no like there

positive song. There's no like there there's really no competition. It's like

a lot more collaborative. But I am very curious and I run the same idea that you did and the same idea that Rockefeller does. It's like I will fly across the

does. It's like I will fly across the country just to have like lunch or dinner with another podcast like I want a download of your thoughts on how you think about your business and like what you're doing.

>> Mhm.

>> What did did you notice as you're building this network and you're meeting all these other people and all these different regions? Did you think you

different regions? Did you think you were different from them?

>> Sure. I mean, but that one of the things I liked about your instance I just listened to on the drive here with your Michael Dell, which was impressive. I know I know Michael, of

impressive. I know I know Michael, of course, we both live in Austin for a long time. We were the two big

long time. We were the two big entrepreneurs in Austin before it became kind of an entrepreneurial hub in the last decade or so. And so I followed his career closely and I know him and he's a

really good guy. Um, Michael talked a lot about um continuous learning.

Remember how he talked about, you asked him, he said, "Well, you had to reinvent yourself like three or four times." He

said, "No, more like seven or eight times." [laughter]

times." [laughter] Yes. Because every time there was a new

Yes. Because every time there was a new revolution, he had to adapt his business. Right. So, I continued to

business. Right. So, I continued to learn >> and you thought they were what was >> they they were they just uh [sighs and gasps]

>> the world is constantly evolving. It's

constantly changing. And if you sit still, Michael said it he said it in his talk with you. If you stay the same, you get passed up, you're going to fail. You

have to continue to evolve. New things

emerge and you have to change with it.

Whole Foods was changing rapidly. We're

opening up bigger stores. Most of these guys didn't have the capital to try to match that. They didn't have the

match that. They didn't have the ambition to do it. Let me back up. I'm

not trying to say this to be for somebody to be like an arrogant person like, "Oh, I'm different from all my competitors." No. It's like a really

competitors." No. It's like a really great way to spot opportunity. The fact

that you see this over and over again is one of my favorite lines in Steve Jobs biography was that if you actually look at his one of his main skill sets was that he was able to identify markets

with second rate products products that he thought he could just make better or think about in a different way like he didn't invent and you just go through all of them from personal computing to the phone to just everything that he's done. I was like damn I didn't even

done. I was like damn I didn't even realize that until it's probably the 10th time I read that book too or the 10th biography of his that I read. I see

that a lot in what you were doing too.

So I'm not trying to be like you to say, "Oh, I was like better than these people." It's just like, "No, I'm

people." It's just like, "No, I'm fundamentally looking at this industry different than they are." And I was wondering if that was obvious at the beginning when you started going around and building this network.

>> Well, I think about Steve. I mean, maybe he took products that were very early. I

mean, for I mean, he didn't maybe invent the personal computer, but they weren't they weren't very good.

>> No, he made it easier to use.

>> Yes. and he he transformed it with a much better, you know, Apple 2 in particular was a huge step or he didn't he didn't do the MP3 player initially, but the iPod was massively better. No,

he didn't do the phone. He you could say he invented the smartphone though. Was

there a smartphone?

>> No, but he was using cell phones and so but the smartphone is not just a phone.

It is completely new new category. You

could always almost say nobody hardly invents anything because they're always taking some other ideas and putting them together in interesting new combinations. But from your perspective,

combinations. But from your perspective, >> yeah, >> obviously you you felt different at that time or no?

>> You know, it's hard to say, David, because I don't really know how other people are thinking. I only know how I'm thinking. I just see how they act. Okay.

thinking. I just see how they act. Okay.

>> And I just know uh most of these people were older than me for one thing and they had families.

They had they were more security oriented. They wanted the financial

oriented. They wanted the financial security.

I just was always always kind of all in.

I was so was I more ambitious?

I was having a good I really like growing the business. I think that's one thing entrepreneurs have in common. They

like to grow their business. It's you

like to see it's like it's it's Michael called it a puzzle he's figuring out.

But also growing a business is immensely satisfying because all the stakeholders are benefiting. Your customers are

are benefiting. Your customers are benefiting. Your employees are

benefiting. Your employees are benefiting. They're getting new

benefiting. They're getting new opportunities, new promotions. You're

watching them flourish. One of the greatest, most satisfying things, particularly as Whole Foods was a public company before Amazon bought us for public for 25 years independent. Um, so

many of our team members became millionaires through our stock option program. If you're on a winning team

program. If you're on a winning team that grows, you can make a lot of money even if you're not the most senior executives. We gave stock options to

executives. We gave stock options to everybody that worked there. And so, so I remember going to an annual gathering.

We had hundreds and hundreds of people and I got this people got they gave this standing ovation for me because they were telling me we bought a house. I

didn't think we'd ever be able to buy a house. My kids they can go to college

house. My kids they can go to college now. Um uh I can retire. This is so

now. Um uh I can retire. This is so great. I never thought and these are

great. I never thought and these are grocery people, right? They're just, you know, people that work meat cutters and just ordinary team members who never thought they would really have any prosperity in the world. That is so

deeply satisfying. Uh that's one of the

deeply satisfying. Uh that's one of the things I liked about the Todd Graves talk by the way was he was so much into his employees flourishing it and that is a tremendously good feeling. This is one of the reasons like I've resisted for

years very close friends of mine where like you should you know all this history you have this stuff in your head from you know the history of entrepreneurship maybe better than maybe better than anybody else in the world you need to start recording some of the

conversations you're already having and I was very resistant to that idea until I realized the gap in the market was like a lot of business and tech press and I don't consider myself a journalist I'm sure as hell not a journalist I'm an enthusiast I'm obsessed with this stuff

look what the books look like when I'm done with them where's the like this. What does that look like?

like this. What does that look like?

That is looks like obsession.

>> Looks like you need a new book.

[laughter] That's obsession. And what I realized like most of the business and tech press hate business and tech and I think a lot of this has to do with you know >> well they don't they're not actually they're just journalists that that's where they got channeled into

>> and and so the opening was exactly I said well I think you know as a son of a Cuban immigrant like I think capitalism is awesome. you have this great thing

is awesome. you have this great thing where you said capitalism was the greatest thing that humans have ever invented, which me and you've bonded over. And I'm like, no, I'm going to I

over. And I'm like, no, I'm going to I want to start hosting conversations to celebrate these kind of people where you had this idea as this shirtless hitchhiking hippie that I want to start

my own little natural food store and I'm going to continuously learn. I'm going

to grow it and as I grow it, I'm creating products that people love, which I'll get to in one second. And

then I'm creating wealth for myself and others for normal people to work at Whole Foods and be able to send their kids to college as a result of the wealth that the the company is able to create to buy a house. These are things that should be celebrated, not

denigrated >> and they're not seen because we live in a we live in a zero sum world. We don't

we live in a we live in a win-win world, but people don't we people don't realize it. People think about the history of

it. People think about the history of humanity, David. For tens of thousands

humanity, David. For tens of thousands of years, there was really no progress in the world. It's been first the enlightenment, science, and then the

birth of capitalism that's lifted humanity, particularly capitalism has lifted humanity out of the dirt. People

have no reference points. 250 years ago, 94% of everyone alive. 94% lived on less than $2 a day. 94%. And that's in

today's dollars. 88% of the people alive

today's dollars. 88% of the people alive were illiterate. 88%. The average

were illiterate. 88%. The average

lifespan was 30.

So many women died in childbirth. There

was there was no modern dentistry. There

was no antibiotics, no vaccines. It was

horrible. People do not understand where we came from. And uh uh capitalism created the possibility of the winwin

win. It used to be a zero- sum game

win. It used to be a zero- sum game where somebody won, somebody else lost.

And the biggest mistake people make, intellectuals in particular, they still think we're in a zero sum in zero sum world. They're obsessed with some

world. They're obsessed with some billionaires, because Bernie Sanders thinks that Jeff Bezos and Elon Musk somehow stole the money from the people.

They don't understand that it's this prosperity machine that's creating more, not just for those billionaires, but for everything that they're touching.

They're creating value for their customers. They're creating value for

customers. They're creating value for their employees. Their suppliers are

their employees. Their suppliers are flourishing. their investors are seeing

flourishing. their investors are seeing their capital go up. It can be reinvested and compounded. We're seeing

governments where all where do all the where do all philanthropy ultimately comes from business? Where's that's

where the profits are? Where's the money come from?

>> And where does all the taxes come from?

And it ultimately comes from business as well. Whether you're taxing your the

well. Whether you're taxing your the employees who are who are flourishing, this is the engine that's lifting humanity out. And the entrepreneurs are

humanity out. And the entrepreneurs are the drivers of that engine. And somebody

like Elon Musk, he gets a very very very tiny sliver of the value that he creates for the whole world. I mean, he's he's created he and people like Rockefeller,

they're they're lambasted as the villains when they are the greatest heroes that have ever ever lived in terms of creating value and helping people. All of the founders and extreme

people. All of the founders and extreme winners that I have studied have this one trait in common. They have

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You just mentioned Bezos and he's got a phenomenal idea. Actually,

phenomenal idea. Actually, >> one of my heroes.

>> One of my heroes. I just got to spend time with him one-on-one. Inc. It was incredible. He's amazing. I one of my

incredible. He's amazing. I one of my favorite ideas that he has is the fact that he's like the idea that we have like a Forbes 400 and we have like a list of like these are the richest people. He's like this is he's like

people. He's like this is he's like there's a better idea. Why don't we have a list for how much wealth that these people have created for others? And I

think he used the example of like you know I don't remember what the market cap of Amazon is. It might be $2 trillion today. Whatever it is he's like

trillion today. Whatever it is he's like out of that two trillion you know I might own 150 billion of that.

>> You see Jeff again when you see Jeff again you should say hey Jeff I thought about your idea. Why don't we create a basos 1000 and you there's a an

organization you with AI in particular that can be calculated.

>> Yeah, it's a good point. Why why we shouldn't run other people? Why

>> that would be so great for people if people could begin to see how much the multiplicity of value that comes out of those entrepreneurs and and and how it compounds over time. It's so enormous

and and the intellectuals do not see it.

The average person doesn't see it. are

still stuck and they think it's a zero- sum game that somebody's rich, somebody else is poor. The rich are getting richer, the poor are getting poorer.

That is not true. In fact, new book for you to read. One, it just just came out.

One of my good friends, uh, Alex Alexander Green, has written a book called The American Dream. And he shows in that book how the American dream is alive and well and it's never been

better. It's in fact, the dream is not

better. It's in fact, the dream is not only not dead, it's much better than it's ever been before. only the

intellectuals and the media cannot see it. They refuse to see it. Instead, they

it. They refuse to see it. Instead, they

focus on all the things that aren't perfect yet in the society and they're doom and gloomers. They think it's all going downhill. So, that's a book you

going downhill. So, that's a book you might want to take a look at.

>> I'll definitely check it out. I have a recommendation for you after this.

Listen to the episode I just did with James Dyson because I kept thinking about >> You know why I'm going to listen to that? Because in the in the episode I

that? Because in the in the episode I was just listening to on the drive, you said that's your favorite alltime autobiography.

>> Number one.

>> Yeah. So I thought, okay, that's the next one I'm gonna listen to.

>> It's I I told him when I saw him, too, because it's out of print and they own the rights. I go, please just like not

the rights. I go, please just like not even for money. You don't need more money. Just this book is so important to

money. Just this book is so important to get in entrepreneurs hands because of the struggle, which is I think what most people identify with. But the reason I brought him up is because one of the things I love about him and what I'm trying to apply, you know, to every

single thing that I work on is like he demands differentiation. He will not if

demands differentiation. He will not if somebody else has already made the product, he won't be like, "Oh, I can do that, you know, a little better." He's

like, I have to have I have to invent a completely different spin on it. And the

reason I think differentiation is really important because there's two things where you kind of knew at the very beginning that you were on to something very powerful. You just told an example.

very powerful. You just told an example.

If somebody's driving an hour or two hours to shop at your store, that should tell you something. The other thing you have, you mentioned how uh you know you reinvested uh as in growth and as you

reinvest in growth obviously sometimes you know you you're going to lose some money for a little bit but the first store was like profitable for like 2 p.m. of the first day and then like a

p.m. of the first day and then like a year later there's like a hundred-year flood in Austin >> 9 months later.

>> Yeah. 9 months later 100year flood flood in Austin. Okay. 8 feet of water. When

in Austin. Okay. 8 feet of water. When

there's a flood it's not just water it's the stuff from the sewers comes up. So

it goes, it floods your store and you have [ __ ] water >> everywhere. And then the next day or

>> everywhere. And then the next day or days after, whatever, you guys are mopping up and taking uh and trying to clean up the store, >> getting tetanus shots >> and [laughter] getting tetanus shots. And then you go

into this aisle and you're like, I thought I knew everybody that worked here. Who's this person? You go over,

here. Who's this person? You go over, hey, I'm John. I'm sorry. I guess I didn't know who you were. He's like, oh, I don't work here, but I'm such a huge fan of what you're doing. I shop here several times a week. I had a day off.

It's very important to me that you guys get through this. So I wanted to help in any possible way. No one does that if your product is not one valuable to them and differentiated.

>> Right? That was I didn't have the language, but that's when I began to discover stakeholders, the people that care about your business. In that case, he was a customer and a neighbor, and he

loved Whole Foods. It made a big difference in his life. I think you will find that most brands that are really popular, particularly in their early days, they

were kind of cults. They were cult cults, meaning they had a following because I think most brands are ultimately built by the evangelist enthusiast of their users, their

customers. Um, Apple's a great example

customers. Um, Apple's a great example of that, right? I mean, people would line up to get that next iPhone, you know, camp out to get the next next generation of iPhone. in the in the day.

Um [clears throat] Tesla, I mean I before I I I own a Tesla and um I remember my friends talking you got to drive this car. You just if you drive this car you want to buy this car and I

said I don't want a Tesla and blah blah blah blah blah. It's pretentious. Blah

blah blah blah. Yeah. Soon as one of them finally taught me to drive it [laughter] and bought it the next day. Right. So

because and I became a Tesla uh fan, super fan, right? So, I do think that happened with Whole Foods. People loved

our stores, particularly in the early days when we were so unique, so differentiated. Um, and I remember those

differentiated. Um, and I remember those people would drive in a lot of times.

They would tell me, "Why?" I said, "Why are you coming in?" He says, "Oh, I want to make sure my little boy never doesn't eat this poisonous food. I They just going to eat healthy food. I g my child's going to be nourished. I'm going

to make sure my children grow up really healthy." And it was oftentimes those

healthy." And it was oftentimes those parents that were doing it for the next generation, so to speak. So, I do think um Whole Foods was benefited by that type of cultlike following.

>> But the evangelism that you see present in customers, I would say that is a byproduct of the fact that those cult brands, which I completely agree with you, are started by an evangelist. You

use that word multiple times in the book. Steve Jobs, obviously an

book. Steve Jobs, obviously an evangelist for Apple, Elon, one of the greatest evangelists that we've ever seen. You knew that you had that very

seen. You knew that you had that very special skill of evangelizing. The way I say think about this is like passion is infectious.

>> I didn't know I had it until it it worked. I mean, I discovered it.

worked. I mean, I discovered it.

>> At what age did you discover it is right at the beginning when you were starting this?

>> I started Yeah. I mean I mean even raising money the first time. I mean

think of think about this for a second.

I'm out raising money even with my friends and family. I'm raising money. I

have six months of experience working in a natural food store. I have absolutely no business background. I'd worked jobs and stuff, but I'd never really been a management. I I didn't take any business

management. I I didn't take any business classes when I was at the university. I

didn't know much about business. And

these people were willing to trust their money to this young kid and his girlfriend. Um, simply on my enthusiasm.

girlfriend. Um, simply on my enthusiasm.

Really, at the end of the day, I was so excited. I more or less said, "I know

excited. I more or less said, "I know this is going to work. Trust me." And

they did. And it did work. I think Jobs called it the reality or somebody said about Steve, he had a reality distortion field. Yes.

field. Yes.

>> I think I I identified with that. I

think most persuasive entrepreneurs, charismatic entrepreneurs have a reality distortion fields. They're able to get

distortion fields. They're able to get people to spend their normal skepticism and for a moment they let them into their vision and they they they catch a little bit. Maybe they don't get the

little bit. Maybe they don't get the vision, but they see the the passion. I

think you've talked about uh how passion is infectuous. I think entrepreneurs are

is infectuous. I think entrepreneurs are generally passionate and they sell others on their dream. I always say that I think I said in the book that um entrepreneurs are a little bit like pan

handlers out there begging for money.

But what they're doing is they're selling dreams. They're selling dreams to people and they make the dreams come alive. And people in the reality

alive. And people in the reality distortion field, they catch a glimpse of what's possible and then they want to get into it.

>> Was there anything you were working on before Whole Foods? What other jobs did you have?

>> I make this joke. You look at if I did a resume, it would say uh bus boy, cargo restaurant at dishwasher at some other

restaurant, um boy camp counselor, um assistant manager at the good food store, CEO Whole Foods Market.

>> Were you passionate in the assistant manager of the good foods? Well, the

what? Good

>> good food.

>> Good food store.

>> Yeah. Yeah. That's that's when I remember I loved working at that store.

I only worked there 6 months and I loved it though. It was like I'd never worked

it though. It was like I'd never worked in a retail store before. I like that because a I like the customers. I I

talked to the customers and they were similar lifestyle that I had. They were

they were like me uh counterculture types. The people I was working with, I

types. The people I was working with, I liked them as well. We shared it. We

were taking care of the customers. It

was fun. I liked it. And I remember coming home back to the co-op, back to Prana House, and I I had thought that day I could I remember the the day while

I was working, I was looking around loving it. And I said, I could do this.

loving it. And I said, I could do this.

I could do this the rest of my life. I

could open up my own store. It'd be fun.

And I went back the co-op full of this enthusiasm. I guess Rene is the first

enthusiasm. I guess Rene is the first person I sold on it because I was so excited about it. And I said, "Renee, what if we do our own store?" and she looked me in the eyes and grabbed my

hands and said, "Oh, Mman, I think that'd be really cool. Let's do it." And

I always say that if Renee had pooped the idea, maybe that would have been it.

But she got excited. So I my spark lit her spark and together we created safer way and that led to Whole Foods Market.

So that entrepreneurial enthusiasm um is very important and also entre entrepreneurs have to be very resilient.

This is a quality that's underestimated because they do fail a lot. They do make a lot of mistakes. I mean safer way I could have quit if I wasn't resilient. I

remember going back and doubling down saying we need to do this. We're we're

as I read all these books I realized my god we opened this safe small store in this residential neighborhood and it's an old house. It's cute. This terrible

place to have a store.

It's no no cars go by here. This is

terrible. We got to relocate it. And

that was a terrible mistake. And

fortunately, I still had enough enthusiasm that I was able to sell people on this big store is going to work. So, we raised more capital and

work. So, we raised more capital and that did work. So, I think you have to be able to overcome your setbacks and the flood could have knocked us out as

well. There's so many times that failure

well. There's so many times that failure is always accompanying you or the and entrepreneurs in some ways are constantly learning from their near-death experiences and and then

determined to learn and get better.

>> You're going to like the Dyson episode because that's his whole point. He's

like success isn't that interesting.

Like failure is like where all the learning actually happens. And

>> success is interesting. I think he's exaggerating there. But you learn more.

exaggerating there. But you learn more.

>> You do learn from success as well. But

you learn more from failure.

>> For sure. For sure. cuz you have to learn or die. I was always working like most entrepreneurs, but I I was always taking odd jobs and stuff. I worked for Astroorld for a while. Even before I legally worked, my parents did something

that was pretty smart. I always tell people they should do this with their kids. They didn't give us an allowance.

kids. They didn't give us an allowance.

They assigned prices for things they wanted to get done for dishes washed, lawns mowed, leaves raed for all those things. And then if you

wanted any money, you go did the jobs.

So I at a very early age, you know, we're talking 10 years old, I I thought, well, I'd like to have money so I could go buy comic books and then later as I got older so I could buy records or I

can save up and buy a car. And so I eagerly worked. And then as soon as I

eagerly worked. And then as soon as I could legally work, I went and took jobs because I wanted to earn money because to me, money meant freedom. I could do what I wanted to do with that money.

>> I felt the exact same way. It's exactly

what it's like. I so deeply desired control over my life and I was actually just talking to a really close friend about this yesterday that I saw just

relentless work ethic and started working when I was 15. I remember my dad coming into my room and telling me cuz at the time uh I really wanted a car and

when when I turned 16 and he's just like uh you don't have to pay rent but I don't have any money for a car so whatever like you have to find a job and essentially like you're on your own and

so since I was 15 like I never got a dollar from my family and then they kicked me out at 18 which is a whole other thing but I felt I think there's a lot of people like this Most

entrepreneurs are like this.

>> The connection is just like some kind of, you know, default unhappiness with your life that realize that you're in charge of it and I'm going to channel

this intense work ethic into uh having achieve success and mainly the success is not because it's monetary. It gives

me control over what I'm doing. Now the

next stage of that and I think the the ideal stage is like you're actually working on something you're passionate about, you believe in. The reason I asked you what other jobs you had because there's multiple times when I'm reading this book I thought of Phil Knight's book Shoe Dog which is to me

one of the greatest >> this this book that was my benchmark Shoe Dog.

>> It's one of the greatest >> entrepreneur autobiographies ever. I

love that it's in chronological order.

>> I love the fact that every um chapter is the year that's taking place. It's just

remarkable. I'm about to reread it again and make another episode of Founders.

But the reason I there's two things that you say in this book that I think are important for next generation of entrepreneurs to understand. one, he

realized that he's he's another evangelist, right? But he didn't have

evangelist, right? But he didn't have the evangel until he found something he was passionate about. He like sold mutual funds. He sold like encyclopedias

mutual funds. He sold like encyclopedias and he failed left and right. And he's

like, "But I'm obsessed with running."

When running, just like you, running was like something weirdos did. You don't

just go out for a run at the time he's doing that, just like it's the funny part in one of your books, it's uh you're you're trying to get the store.

>> It's the f I think it's the first store out of Austin. So maybe it's like in Houston or something. Yeah. And you meet with the landlord and the landlord's like, "Listen here, hippie guy." He's

like, "There's not enough store. There's

not enough other hippies are going to eat your hippie food." And you're like, "We're not opening. This is not hippie food." And he explained to him what it

food." And he explained to him what it is. He goes, "This is hippie food." But

is. He goes, "This is hippie food." But

he he bought into your enthusiasm. Yes.

And he said that you reminded him of like a younger you.

>> Slight correction on the narrative. You

got the essence of it, right? But that

was actually our very first Whole Foods Market. Oh, there you go. When we were

Market. Oh, there you go. When we were jumping up from safer way because Ben Pal, he was a he would have been in he was a lawyer from Houston. and he'd been

in LBJ's administration and uh he owned the property. So I I I would had to sell

the property. So I I I would had to sell him. I mean entrepreneurs have to sell

him. I mean entrepreneurs have to sell people on things and and he just thought this was a crazy idea. You're doing a hippie food store. How can that possibly work, son? I said I said it's going to

work, son? I said I said it's going to work there. I just it's going to work.

work there. I just it's going to work.

And he said there's not enough hippies in the whole world to fill up the store.

And I said something like there's more than you think. [laughter] And and then I kept going on and he started laughing.

Started laughing at me and he said, "Son, you so much remind me when I was young, you're so full of your enthusiasm and

you're so sure you're going to be successful." And and he says, "Let's do

successful." And and he says, "Let's do your damn hippie store." You know, but one thing I can tell you, son, is life's going to teach you a thing or two before it's through with you. [laughter] He was

great and he was very helpful.

>> I love these people. The people that are older, further down the path and they reach back and they give you words of encouragement or they help you. The guy

that helped you at the bank, they didn't even tell you after the flood, loaned you money and didn't he didn't even tell you till years later. He went to bat for you, which is that's a funny story because it happens in these books over and over again. I want to tie go back

and close the loop on Phil Knight though and I think it's important is >> what he realized is belief is irresistible.

>> And he's like, I couldn't sell the stuff because I didn't believe in the product.

Now I'm selling Japanese running shoes out of the trunk of my car long before Nike is even a thing and I can't stay in stock. And he's living at his parents

stock. And he's living at his parents house, you know, not in a situation that he wants to be in. He's like, "What the hell is going on here?" And that's when he realized, oh, belief. I believe in my product. Belief is irres is

product. Belief is irres is irresistible. And that was like this

irresistible. And that was like this fuel. The second thing that um you said

fuel. The second thing that um you said in the book and I think you mentioned it I don't remember if this is before we were talking or when we started recording was entrepreneurs tend to remember the beginning like the early

years and then maybe the later years but there's huge maybe like two decades in here and Phil Knight advised cuz he's writing that book for the benefit of future generation entrepreneurs he's like man there's so many times in the

early days we were talking about what we wanted Nike to be we were having incredible conversations we were such a close-knit group and those conversations have lost to history I wish I either had a tape recorder or I wrote it down in a

journal. So when I meet younger

journal. So when I meet younger entrepreneurs, I'm like, you need to write down what what you're experiencing. You're you think it's such

experiencing. You're you think it's such an intense feeling. You think you're going to remember you're going to forget all of this and you're doing an act of service to the, you know, for the future you for two, three, four gener uh four decades down the line.

>> You know, since I used Shoe Dog as a benchmark is one thing I did differently than Phil did in his book. I did

document I kept track of time and and uh you don't really know the do you know mo almost all a shoe dog takes place in like a five-year period.

>> It's it's I think it's a little bit more than that. It ends at the with the IPO

than that. It ends at the with the IPO >> IPO. Yeah.

>> IPO. Yeah.

>> He got his early years but he didn't you know the Nike became this phenomenon that changed the sports apparel business changed

marketing it it was huge benefit for athletes. There's a a lot of things

athletes. There's a a lot of things about Nike in the story that that he doesn't go into that book. He should

have written, in my opinion, he should have written a a follow-up book because I think so much of the Nike story takes place after that occurred. One of the things I did in this book is I talked

about how old I was at this time and I the book is is written chronologically in a way and it goes it spans it spans a

40 44 year period. Actually,

>> I do that all the time. Even if it's not stated where where I am in a book, I will go and be like, "Okay, well, we're in 1969 and this guy was when was he born?" And I'd write down on the page,

born?" And I'd write down on the page, "Okay, he's 24 when this is happening."

Or I'll go and be like, "Hey, what was he doing when he was my age? How was he thinking?"

thinking?" >> I do. Absolutely. And I'm thinking because I'm trying to understand that entrepreneur and and so by saying, "Well, how was I thinking and feeling at

that age?" I can understand them a

that age?" I can understand them a little bit better. I I I really like the idea of, you know, by the way, you said I was, you know, like Rockefeller. You

you did draw some analogies there, but there are so many major differences there. Um, I mean, Rockefeller is the

there. Um, I mean, Rockefeller is the and my still and maybe Elon Musk and Steve Jobs can challenge him, but but he's probably the greatest entrepreneur that ever lived and and I would argue he's probably done more even though he's

hated as this Robert Baron, he's probably done more good in the world than maybe anybody but some religious leader or Christ or something. But, um,

he it's it's unfortunate that he goes down in history as one of the great villains, but the intellectuals have put him there. And

him there. And >> not in the episodes I make about him.

No, but uh the reality is Rockefeller was uh invented the modern corporation.

Oil has has fueled the entire rise of prosperity in the world. Um and he's totally misunderstood. Was he perfect?

totally misunderstood. Was he perfect?

No. But he still the greatest philanthropist that ever lived.

>> So you did you take issue with me comparing you to Rockefeller?

>> I was deeply flattered.

>> Okay. [laughter]

>> The way you started I was like wait a minute. Okay. I didn't know if you were

minute. Okay. I didn't know if you were uh took offense. I like no I and when I say when I compare people to other historical people it's always like this one thing they did is very similar to this act that you did people you know dynamic

>> one thing Rockefeller did that I never uh did and [clears throat] it was a different era he he continued to vertically integrate all you know uh and

and he was trying to bring order to his industry because of the the boom and bust of oil discoveries and and uh um he was he was a much more disciplined

thinker than I am in terms of thinking through the whole structure and the whole system and trying to control it and I never tried to control the you

know my suppliers or uh uh I never and he he was he was a totally ruthless competitor in the sense that he would he would do things that today would be illegal um but they were legal at that

time people don't understand what he was doing was not was considered sharp business practices but they weren't considered to be illegal and what he would you know, he he threatened a lot of his competitors. You should sell out and you should take the stock because

you're going to get a lot wealthier, but if they didn't sell out, then he basically undercut them in price uh and lose money until they until they were out. You can't do that today.

out. You can't do that today.

>> One of the best quotes I ever heard from him, he was trying to buy a competitor and the competitor says, "I'm not afraid of you." And he's like, "Well, if you if

of you." And he's like, "Well, if you if I cut off your hand, your body will suffer." [laughter]

suffer." [laughter] That's a very crazy thing to say. Um,

but you I think you nailed the fact that uh he his he was probably one of the greatest strategists.

>> Yes.

>> I had the thought, you know, I reread things over and over again. I know you have that same habit that you'll read a book and then you'll reread either read the entire book again a few years later, but you also read your highlights from them. We talked about this at dinner

them. We talked about this at dinner when we had dinner.

>> Read wise, too.

>> Yeah, they're excellent. the when I rate I think I was rereading Jeff Bezos's shareholder letters for the third time which I think are very I think I should read them almost every year because they're just first of all you can read

them in a weekend and they're just so many insights per minute and in my opinion I think the two best strategists that I've ever come across in all the reading I've done has been Rockefeller and Bezos kind of describe what they

want to do and then they go out and do it and it's very very similar.

>> Yeah, I think you got to put Musk in that category as well. People don't

understand what a master strategy strategist Elon is. And think about the way SpaceX has evolved in a way. It's

he's he's he's so many steps ahead of where people realize he is in terms of thinking it through.

>> No, that's a good point. I mean, he has that document, I think, called Master Strategy that he wrote, you know, 15 20 years ago, whenever it was at the beginning of Tesla. He's like, we're going to do this, then we're going to do this, and then we're going to do this.

And you you go back and it looks very similar to what actually occurred. Uh, I

want to go back to your competitive drive though because we touched on it, but I I think there's like a little bit more there.

>> Well, I'm, you know, I'm a very competitive person. Um, I always have

competitive person. Um, I always have been. I mean, from an early age, um,

been. I mean, from an early age, um, competition, I think, helps me focus. Um, one of the things I

got that I think in the Todd Grapes that I just listened to recently is he talked a lot about people are always telling an entrepreneur it's not going to work. And

he Todd would use that as fuel. He'd

say, "I'm going to prove you wrong. I'm

going to show you." I still feel that way from time to time. People tell me the idea is not going to work. And it's

like, "No, it is going to work and I'll show you." And when and and you climb

show you." And when and and you climb this wall of skepticism.

A lot of people, they get discouraged when people criticize them. It's like,

you know, maybe they're right, maybe it's not going to work. The

entrepreneur, I think, says, "No, you're wrong. It's going to work." And it

wrong. It's going to work." And it causes him to focus even deeper and and and and and to to part of it's an ego thing to prove the other person is

mistaken. And I I remember when that guy

mistaken. And I I remember when that guy told me that um you know, you're never gonna be able to compete with those guys. You're just a bunch of hippies.

guys. You're just a bunch of hippies.

It's never going to work. And you know, I I I make the joke in the book, it's like the guy had just turned us down.

Why is he telling us why he's not going to invest? And I say it's like getting

to invest? And I say it's like getting turned down on a date and then the girl tells you, "Well, here's why I'm not going out with you." It's like, "Hell, who wants to be told while you're not going out with me?" Um, in this case

though, I I remember having a slow burn in me which said, "You're wrong. You're wrong.

I'm going to prove you wrong." So, a good entrepreneur uses that criticism, uses that skepticism, uses that wall of doubt that people are throwing at his or

her uh as a as a fuel. It's like, "No, we're it's going to work. I'm going to prove it." And they're they're they

prove it." And they're they're they double down on their vision, you might say, and they're not and they and instead of many people would quit. It's

for the the entrepreneur. No, no, it just makes me more determined to succeed.

I read something Jeff Bezos said that changed my perspective on the importance of high quality sleep. He said that he makes sure he gets eight hours of sleep a night. And as a result, his mood, his

a night. And as a result, his mood, his energy, and his decision-making is improved. His point was that you get

improved. His point was that you get paid to make high quality decisions. And

you can't do that if you're sleeping terribly. And the product that has made

terribly. And the product that has made the biggest impact on my quality of sleep for years is eight. I'm lucky

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city. A few months after I started using eight, I randomly ran into Matteo at a restaurant and I was with some friends.

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good sleep." Matteo is living and breathing his product. I had never had the ability to change the temperature of my bed before I had an eight. I had no idea how much that would improve the

quality of my sleep. I keep my eight ice cold. It's cold before I get into bed,

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That exact same story is in Michael Dell's autobiography. I went picked it

Dell's autobiography. I went picked it up off the shelf the other day and I I wanted to because he says something that I think is very fascinating that I reference in conversations and other episodes that I make where, you know, he's like, I'm 19 years old. I have

$1,000. I'm in a dorm room of Texas and I'm going to compete with the largest company in the world in IBM.

>> Okay. You expressed some skepticism in your in your interview with >> I I never doubt I never doubt Michael Dell. um he's one of my heroes and I get

Dell. um he's one of my heroes and I get to spend a lot of time with him which I'm very very thankful for. But on that page he's like you know was I a little full myself at 19? He's like sure I was and he's like I think you have to be to

you know do anything great. And you talk to him now it's like the guy's so impressive but he's so low ego and he's just very calm and he really is like just looks at things like a puzzle and I think a lot of the work he does comes from a very positive and like healthy

place and that's why like he is one of my heroes and somebody I'm trying to emulate. Fire still burns in Michael.

emulate. Fire still burns in Michael.

Even though if you don't see it, it's still there.

>> Yeah. But it's a positive. Yeah. I think

the positive source. But later down, I I reread that entire page. And he's

talking about this other guy at the time that was older than him that was living in his city that was doing the exact same business. And it sounds very

same business. And it sounds very similar to when you viewed some of your friends and then eventually competitors and some of the people you actually acquired where Michael's like, "Yeah, but I have ideas about where I could take this that this guy can't even

contemplate." And he was not saying that

contemplate." And he was not saying that in an arrogant way. He was just saying like you don't have any limits. Did you

listen to the Daniel Ek episode?

>> Yes.

>> Okay. So, Daniel, this is one of the most important things about that episode and about spending any time with him.

You get around him and you realize he has no ceilings. He does. There's no

self. I think a lot of people It sounds like I want I want to go back to the the people you acquired because one of my favorite I'm doing this for selfish reasons. This is why I'm having these

reasons. This is why I'm having these conversations because I had the opportunity to learn from you.

One of the things that's so incredible is I think a lot of people and I've done this myself they put these like fake ceilings.

>> They put self-limiting beliefs in >> but it literally like I can't go any further than here.

>> And when you spend time with Daniel he's just like oh like get that [ __ ] out of here like that doesn't exist. And he

does that not in a direct way. He does

that in a way of an example that it's like well I remember um one of the first times I talked to him >> Spotify is obviously incredible >> and I was like but he's doing incredible like investing in business incubation

and I know that team very well. I spent

a lot of time with them and I was like how the hell did you build this like incredible business that was so difficult and then now you're you have this other thing where like he's more like a co-founder than investor but it

>> you're talking about neco >> neco housing everything he's doing with pre uh primaria and I was like did you were you always interested in investing and he goes no I

didn't even think about it until 2018 and I go how did you learn how to invest he goes I listen to Patrick's podcast invest like the test [laughter] and then he's like I would listen to what the guy says. I'm like let me try

that idea. I don't like that idea. I

that idea. I don't like that idea. I

would read the book he recommended and he just essentially consumed all this information and then said I like that that fits me that's not that doesn't apply to me. I don't like this and then created his cohesive philosophy and then

he actually applied it to a grand scale and I'm like oh he's got no limits. This

is one of the most valuable things that you could possibly if you can instill something in yourself is just like stop believing that you have a limit. You're

at a plateau, but you don't just like Bruce Bruce Lee said, you don't stay at plateaus.

>> I totally agree with that. Cre human

creativity is fundamentally limitless.

There is no limit to the mind except what we self-impose on it. And once you realize that, see, most people self-censor themselves. They don't let

self-censor themselves. They don't let these ideas come through because it's like, well, that's not possible. That's

crazy. That's nuts. I think entrepreneur lets a little bit more through in terms of that flow from from that emerges up through through their minds.

>> But not all entrepreneurs because we're seeing this in the story in the book where you have that you had that slow burn which I want to ask you a question about the slow burn in a minute and then you're meeting other people in your

industry and realizing that they're not like you.

>> They just had different I just had different ambitions. That's all. They

different ambitions. That's all. They

they I just had a uh um I just wanted to grow a bigger company. They wanted they just didn't

company. They wanted they just didn't have that vision.

>> Do you think your father played the role in your expansive ideas and your ambition or do you think that was completely like an inner drive?

>> I credit many many good things to my father. I actually think he played a

father. I actually think he played a counter uh inforce on a force on that.

And my dad, for example, he was a depression uh kid in World War II.

>> He was 20 when Pearl Harbor happened.

>> Yeah. So, one of the things that one of the mistakes that I made was after Holies went public, my dad was he got me to sell stock in the IPO. This Todd

Graves would hate this uh stock in the IPO and he he urged me to continue to sell it off. He said, "John, I mean uh we don't know when the next depress my dad said he'd have made a lot more money. He was always thinking there was

money. He was always thinking there was going to be another great depression. So

he was always trying to protect himself from that because it was such a it was such a traumatic experience for him as a child watch growing up in that depression with his with his family. Um

they lived through it and it never it was the biggest thing that impacted him in his life and so in some sense that spread to me. So it's you might say that's more limited. I sold it because he advised me to do it and I trusted my

dad. But in retrospect, that was a

dad. But in retrospect, that was a mistake and I really believed and I should have compounded it and compounded it and compounded it. Um, still made still made I'm still really a wealthy guy, but I could have been a lot

wealthier if I had just probably followed my own instincts instead of his advice in that regard.

>> You're you're right about that cuz I forgot in the book you ask him to step down from the board.

>> Yeah.

>> Because you have this expansive conquering nature which you're going to use the word expansive. while you was conquering nature and he was kind of like pulling you back constantly and you guys were having a series of fights. Am

I remember that correctly?

>> That's correct. But I think in that case my dad he he was in he was already being impacted by the Alzheimer's that was diagnosed a couple years later.

>> But you didn't know that.

>> Did not know that. I just didn't understand why he'd gotten so conservative because he'd been very supportive of my expansive mode.

[clears throat] And I at the time I just thought, you know what, now we're worth so much money. And a lot of my father's wealth was created by Whole Foods. He

had his own he had his own business, but I think he made more money from Whole Foods than he did in his other business.

I thought he just doesn't want to lose what he has. He's in a different era in his he can't rebuild. So for him, he wants to be more conservative. And I

just said, he's getting super conservative. That's why I said, "Dad,

conservative. That's why I said, "Dad, sell half your stock, cash it out, keep the other half, let me compound it, but let me go. I I we're going to grow this thing. It's going to be an incredible

thing. It's going to be an incredible company. Just let me do it.

company. Just let me do it.

>> Do you remember how old you were when you >> you were 40 and he was what? 70.

>> My dad was 72.

>> Same as I am right now.

>> Okay. And so he had been around for the ride for 15 years up until that point.

>> Oh, no. Uh yeah. 15 years. That's right.

>> 15 years.

>> Yeah.

>> So that had to be one of the most difficult conversations you had in your life.

>> That was the most difficult convers I ever did was firing my dad from that board. Took all the courage I had. But I

board. Took all the courage I had. But I

love my dad so much and it hurt him so badly so hard to do. But it was it was also a pivotal event in my own evolution.

[clears throat] Um because that was that was when my mentorship was over. He

still advised me but from that point onward I really you know I I I was on my own. I was not going to follow him any

own. I was not going to follow him any longer. Before then I pretty much did

longer. Before then I pretty much did whatever my dad suggested. I didn't buck him. I argued with him, but I often

him. I argued with him, but I often caved in because I had so much love and respect for him and I and in his own and it was a good thing. My dad made so many good decisions that helped Whole Foods.

But at that point, I was just basically I'd grown up. I remember saying, "Dad, I'm 40 years old. I'm going to make these decisions now. I'm not going to just do what you want to do. And that's

why I want you to get off the board because I don't want us to be fighting.

It's turning our relationship apart." I

remember he said, "Son, you think 40 is pretty old, don't you?" And I said, 'Yeah, 40 years old. He said, 'It's nothing. You think he You think you know

nothing. You think he You think you know some things? You know a little bit more

some things? You know a little bit more than you did when you were 25 and started the business, but frankly, son, you still don't. He said he said, "You've barely got your nose under the tent. There's so much you don't know."

tent. There's so much you don't know."

And I said, "Well, that may be true, but I'm going to find out on my own. I'm not

going to do what you tell me to do any longer, particularly when it comes to growth. We're going to grow this

growth. We're going to grow this business, and you should sell half your stock. you've got all the financial

stock. you've got all the financial security you need and watch what happens to the other half. And I I always tell the I tell the story in the book that a year later he that the half that he'd sold was worth as much because we

doubled the stock price in a year. Had

the half the stock that he owned was was um more valuable than it was prior to his selling half of it. So he he'd already he'd already made it all back.

Uh so he did he and a and a few years later even as the Alzheimer started to grip him my dad told me that um I had made the right decision and that he was proud of me and you know we we were back on really good terms.

>> That's incredible. There is a ne very negative um and has to be heartbreaking story in the book. Your mother's view of foods.

>> Yeah.

>> I don't know if you want to talk about this or not.

>> Yeah. You know, my mom um [clears throat] again another depression child and I was named after her father who was a doctor and what my mother growing up in Bastrop, Texas, kind of in

a poor, you know, I guess almost white trash type of thing back in that rural, you know, little tiny town, very small town ways, Baptist community. Um my

mother, the most important thing for her was she really wanted to be respectable.

She wanted she wanted her children to rise in society and be seen as respectable citizens.

And my sister, the eldest sister, you know, she went on and got a master's in French lit, went to Welssley, got a masters in French literature and a PhD in

psychology and, you know, went on to teach. Um, [clears throat] here I am

teach. Um, [clears throat] here I am scoring really high on IQ test, you know, great aptitude, A's when I was interested in something,

maybe not so good when I wasn't, and, you know, kept I kept dropping out of college and I start this grocery store business. My mother could never get over

business. My mother could never get over the idea really that I was not respectable. that she'd go to her bridge

respectable. that she'd go to her bridge parties and talk to the other mothers and their sons were going on and their daughters were going on and becoming uh uh doctors and lawyers and they were

they were engineers [cough] [clears throat] uh college teachers, professors. They were they were she saw

professors. They were they were she saw them as respectable people in society.

She thought a grosser was you know really a secondass citizen. And so her son in her mind I wasn't an entrepreneur. She didn't even know what

entrepreneur. She didn't even know what an entrepreneur meant. I don't think I wasn't a successful businessman. I was a grosser and I had squandered I didn't finish college. I'd squandered all the

finish college. I'd squandered all the money they and love they'd invested in me. And she thought I was a failure. And

me. And she thought I was a failure. And

I remember and I tell the story in the book, the very last time I I ever saw my mother in my life was back in 1987. She

had had a stroke a couple years later and she was basically partly paralyzed and bedridden. And I went to see her and

and bedridden. And I went to see her and uh it turned out the last time I'd ever see her because she died a couple of weeks after I saw her. And she so I say on her deathbed she begged me. She said,

"John, will you do this for me? Will you

make this promise to me? I'm your

mother. I've nurtured you. I've warned

you. I've given you so much. Please,

please, please, please promise me you will go back to school and get your degree and make something of your life.

you have so much potential. You know,

you scored so well on all these IQ tests and aptitude tests and you're just nothing but a grosser. I said, "Mom, I'm not a grosser. I'm I'm a businessman.

I'm building this business. Whole Foods

is going to be this great company." She

says, "John, it's just the little grocery hippie stores. You know,

nobody's, you know, you you're not doing you're wasting your life." And and I and she said, "Please promise me. Please

promise me. It's the only request I have. please promise me.

have. please promise me.

Now I look back and I, you know, I kind of wish I I'd lied and just did a white lie to make my dying mother happy, but I was, you know, it's 1987, I guess. Now

what? I'm I'm 34 years old. And I just said, "Mom, I'm never going back to school. I'm I'm not going to go back.

school. I'm I'm not going to go back.

I'm building Whole Foods and it's going to be this amazing company. Already is

an amazing company. It's going to be even amazing." I said maybe I will get a

even amazing." I said maybe I will get a an honorary degree someday because I'm going to make a lot of money and I'm going to university is going to give me a honorary PhD which actually did

happen. Uh and uh and she died a very

happen. Uh and uh and she died a very disappointed person and you know that that her son who she had so much hope in had had wasted his life. So she died we

were alienated when she died.

>> That was your last conversation you ever had with her?

>> Our last conversation she died a couple weeks later. You know the funny thing is

weeks later. You know the funny thing is my mom has been dead. I I think about my parents. My dad died in 2004. My mom

parents. My dad died in 2004. My mom

died in 1987.

And I still have conversations with them. I mean I mean in my mind and uh uh

them. I mean I mean in my mind and uh uh you know I I I ask for forgiveness with them and I give them forgiveness and I what I wouldn't do to have you know I'd

probably pay all my entire fortune to have one more night with my parents.

That'd be so great to be able to tell them how much I appreciate all the things they did to me and how much I love them. And also, hey mom, I turned

love them. And also, hey mom, I turned out okay. And uh so we'll call that a a

out okay. And uh so we'll call that a a minor regret in my life that I couldn't make my mother happy on her deathbed.

Give me one minute. That's [ __ ] That's heavy.

>> Sorry to take the energy down a little bit. [laughter]

bit. [laughter] >> Don't apologize. That was absolutely incredible. I think it's very important.

incredible. I think it's very important.

>> You know, I I'll tell you I'll tell you.

Um somebody helped me see this. I was

doing a podcast and they had read the book and they had an interpretation of my mother that I'd never heard before, which was, you know, and I I realized they were right. I'd always thought

that, you know, I was much closer to my uh father than I was to my mother, but my mother had grown up in this, again, this small grass drop town. Here's the

ironical thing. My mother was a total rebel. She rebelled against that, you

rebel. She rebelled against that, you know, she left that town. She went to Houston, went to Rice University, got a went to school and got a degree. She was

in a Baptist town. My my mother, she started to smoke in rebellion against their their, you know, she started to gamble. She started to drink. She

gamble. She started to drink. She

started to dance. She was total rebelled against a small town of Bassrop, Texas.

And the guy in the I was talking to about it said, "You know, John, you probably got your rebel side not from your father, but from your mother." I

never thought about it before. And I

thought, you know what? Think I think he's right. I'd never I'd always

he's right. I'd never I'd always credited my own rebellious nature to my father, but I realized my mother had it secretly inculcated in me and then didn't like it there. You know how we

oftenimes project out onto other people the things that about ourselves that we don't like? My mother wanted to be

don't like? My mother wanted to be respectable partly because she had rebelled against all of her things that that her parents had taught her and went her own path and she

inculcated that in me unconsciously. The

other children were more obedient. I was

this rebel and uh I never credit her for it, but then I then I had on my own little ceremony. I thanked your mom, you

little ceremony. I thanked your mom, you know, thanks for helping me become a rebel because it's really helped me be successful in life. Thank you. I owe you so much for that.

>> The reason that just impacted me and the reason I want to talk to you about cuz like when my mom died, I was around that same age and we were estranged.

Like the saddest thing is she died like a a just horrific death.

>> Metastatic breast cancer spread everywhere >> and the last two years of her life like that's not life. That was not living.

That was suffering. And what I'm like, >> that's my advice for you. I would

recommend that you do in your own way, if you haven't already done it, do some type of ceremony of forgiveness

with your mother. Just where you actually ask for her forgiveness and you forgive her and it's like and tell her just I

love you so much, mom. Thank you for everything you did for me. I wouldn't be the person I am today without you. You

You nurtured me in the womb. You went

through labor and pain for me to be born. You wiped my butt. You breastfed

born. You wiped my butt. You breastfed

me. You took care of me. You kept me alive. You nurtured me. You helped me

alive. You nurtured me. You helped me get educated. I owe so much to you. I'm

get educated. I owe so much to you. I'm

so grateful for you. Thank you so much.

And I didn't tell you that the way I needed to tell you that while you were alive, so I'm telling you now. Please

forgive me. And um and then forgive her.

I've done that and I feel like I'm I'm at peace about it.

>> That actually is a a good like lead into I think one of the most important things that are in the book and you also talked about this when uh we had dinner. You recommended MDMA therapy for me.

>> Yeah. You said no way I'm ever going to do that.

>> Which I [laughter] still haven't. Um

talk about the inner work that you did.

>> But you know what you what I can recommend that you could do and it'd be just as powerful. Don't take a drug, but do some serious breath work because I always tell my friends that particularly

don't want to do any type of um like MDMA or psilocybin, don't want to do psychedelic, you can have a transcendent experience just through breath work. You

can you can access deeper parts of your unconscious mind that you've repressed and you can relive those experiences in a safer environment because what's safer than just doing a deep breath? Do it

with a guide. And you know you need to do at least an hour to hour and a half or two hours and you have to do the deep breathing. But what happens the breath

breathing. But what happens the breath activates parts of your more deeper self. It's mostly hidden from you and it

self. It's mostly hidden from you and it it lets it come into your consciousness in a way that um you can see it and not be overwhelmed by it. It's a way to

practice um uh letting go of some of the stuff that we feel guilty about that we suppressed that actually drives a lot of our behavior. aren't even conscious of

our behavior. aren't even conscious of it. You can have a transcendent

it. You can have a transcendent spiritual experience through breath work and it's completely safe and hey if it gets too scary you just stop breathing so you're always in control.

>> When did you start realizing you needed to fix something that was inside your mind as you're building the company? Was

it early when you were starting the company?

>> Remember I started I did psychedelics before I even started the company. So

>> you tell this crazy story about doing LSD and I think you were >> that's how the book starts out in the prologue. So I'd already done I mean

prologue. So I'd already done I mean wasn't doing it therapeutically. I was

doing it I I was doing it spiritually. I

was trying to access deeper parts of the spiritual being that we don't normally do that. Think of psychedelics as

do that. Think of psychedelics as opening a doorway to going into parts of our mind and our greater. There's

there's an interior self that's every bit as the ex big as the external universe maybe bigger that we don't because we're so focused on living in the material world. We're not conscious of this deeper part of our being.

Psychedelics open a door to it. But

there are other ways. meditation does,

if pursued, breath work does. There's

different types of modalities that help us access deeper parts of our consciousness. And I think to grow as a

consciousness. And I think to grow as a human being, we need to go deeper so we can begin to release fears, guilts, judgments that kind of hold us back. And

I think every one of us can access that.

>> Were you doing this the entire time you were building Whole Foods?

>> Yes. I mean sometimes more seriously than other times but yes it was a it that's why as you read the book you know I'm telling the narrative but I'm also telling my own narrative my own spiritual evolution all the way to the

very end of the book and it's still happening now I'm still evolving so um I I think rightly seen the entrepreneurial journey is also a spiritual journey it's

also a hero's journey I I talk about the hero's journey in the book um most people do not go on their own hero's journey we have a voice. Deeper part of

our being is whispering to us, telling us, urging us on to follow this, you know, entrepreneurs are following this inner voice. They're following this

inner voice. They're following this passion that they're that that they unleash and they create in the world.

Um, you have that voice whispering to you, too. And that's why you're doing

you, too. And that's why you're doing what you're doing because you're so passionate about it. Um,

that is the hero's journey. In my

experience, most people do not answer that call because they're too scared.

They're too scared to do it. They want

to they a fear of failure, a fear of people ridiculing them, fear of fear of rejection. Remember how we talked a

rejection. Remember how we talked a little earlier about how the entrepreneurs are um like Todd Graves, people are telling you you're going to fail or I was saying that would just make me more determined to succeed. When

you're on the hero's journey, you are determined to succeed. And you you're you're going to have a lot of setbacks and failures, but that's all part of the path. That's how you're learning. That's

path. That's how you're learning. That's

how you're growing. Rightly seen, the entrepreneurial journey is a hero's journey, and a hero's journey is a spiritual journey. It's a journey of

spiritual journey. It's a journey of discovery. It's a journey of going

discovery. It's a journey of going deeper into yourself, knowing who you are and what really matters in life.

>> John, that's a beautiful place to close.

Thank you very much for writing the book. Thank you very much for taking the

book. Thank you very much for taking the time to have a conversation. Thanks for

talking to me again, David. I really

enjoyed it. Thank you.

>> Thank you.

>> I hope you enjoyed this episode. Please

remember to subscribe wherever you're listening and leave a review. And make

sure you listen to my other podcast, Founders. For almost a decade, I've

Founders. For almost a decade, I've obsessively read over 400 biographies of history's greatest entrepreneurs, searching for ideas that you can use in your work. Most of the guests you hear

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