Season 03 Episode 15
Josh Linkner, Venture Capitalist and Jazz Musician

Chris Allen: All right, well, I would like to welcome to The Entrepreneur Studio, Josh Linkner. Welcome, Josh.

Josh Linkner: Thanks. Great to be with you today.

Chris: Yeah, absolutely. I mean, just getting here and getting us all settled in here, but I mean, I think just us being on the phone a couple of days ago, a couple of things popped into my head. I was like, okay, so founder of multiple tech companies, co-founder of an innovative VC firm, and a jazz musician with a really nice guitar in the background. I was like, okay, so what’s the common thread that has driven your success across all three of those?

Jazz — the entrepreneur’s teacher

Josh: Yeah, good question. I’m really a jazz musician at heart. I started playing 40 years ago. I’ve played over 1,000 concerts around the world. And when I started my first company at age 20, I’d never taken a business class. I didn’t know anything about business, but I knew jazz. And in jazz you’re using a lot of improvisation, creativity, situational awareness, active listening. You take responsible risks, you course correct when you screw things up. And so in an odd way jazz was the perfect teacher for entrepreneurship. Everything from co-creation with collaborators to navigating uncertainty and change. So it was actually a wonder. It was like the best NBA ever.

Chris: That’s amazing. But then you got the VC thing, so how did jazz help in that?

Josh: Well, to a degree. I started my first tech company at age 20, and I didn’t start Venture Fund until I was 40. I got some business experiences in the meantime.

Chris: For sure.

Josh: But really the same principles apply. I mean, you’re sort of navigating new circumstances. You’re using vision to create something that’s net new. You are responding quickly to changes. You have to be very agile and fluid. There’s a lot of making mistakes and course correcting. And so, it’s been a wonderful teacher, again, not just for me, but as I help advise entrepreneurs and invest in their companies, giving them a little bit of that jazz influence has paid off.

Chris: Yeah, absolutely. Well, we’ll talk more about that. I think it would be really helpful just to maybe unpack a little bit of your short history or just history in a sort of abbreviated version. Talk about the companies, the tech companies, and a little bit of what happened. Just a brief history of that?

Josh: Sure. Well, I was born in the city of Detroit, not the suburbs. I put myself through college playing music. And it was always passionate about creating things. And sometimes I get to do that with music and other times now with business. But again, I started this company at age 20. I had this idea to assemble computer components that I could mail order in my college apartment and sell them at a discount on campus. And this was way before you could go to Best Buy and get a discount computer. And so that was actually a novel concept, as silly as that sounds today. And I got a little bit of momentum. And by the way, I made every mistake you could make. I screwed up everything, but got a little bit of traction. I ended up selling that company, not for a huge profit, but I learned a ton.

Then I started a similar company. I sold it about a year later. Again, not a huge operation, but I’m getting laps in, I’m getting some reps in. I’m starting to learn the nuances of what it takes to launch and scale. In 1995, believe it or not, I started an internet company. I would literally call people up and say, “Hey, have you ever heard of the Internet?” And they’re like, “What’s that?” I was like, “Well, I could build you a website.” They’re like, “What’s a website?” But we were very early on and we built websites and did E-commerce and hosting and such. And I built and scaled that company and sold it to a public firm in ’99.

And so now I’m again getting some lapse in, and in 1999 I started a company called ePrize. And so ePrize is I think half ad agency and half software company. We were a digital promotion firm. We built design and ran digital promotions for large brand advertisers like Coca-Cola and Procter & Gamble. And so that I was a CEO and sole founder for 11 years. I then moved to a chairman role and we had a meaningful exit a few years later, so it was a good ride along the way. But I think the pattern has just been seeing an opportunity and having the willingness to move forward, even though you can’t see the finish line. It’s like a willingness to get started and find your way as you go.

Chris: One of the things that I really liked that you brought up and I’ve seen just on the internet about you is just really about this idea of frameworks. And I’m a frameworks guy too, so I wonder if your sort of, I’m going to say philosophy on frameworks. Is it about being able to have a tool chest that when you encounter a problem you have a point of reference and to be able to address that problem?

Josh: Yeah, I think so. They say the best chess masters are good pattern recognizers, and I think the same is true for entrepreneurs. And so what a framework does is it allows you to sort of know where the pieces are going to go and you can relate it to something previous experience, either right or wrong, by the way. You can learn from your bad mistakes as well as your good successes. And then apply it. And it’s a helpful scaffolding to help you scale. Back to jazz. Jazz is actually really like a framework. If I were playing a gig tonight with you here in Denver, only about 1% of the notes would be on the written page. It’s really more like a suggestion. Even if we played that same song 10 years in a row every night it would be different. Because in jazz it’s not written out note for note, it’s really more of a framework. And so I adopted that early, and of course now apply it to business. And I spent a lot of time thinking about what’s the framework for entrepreneurial success, and I’d be happy to unpack that.

Chris: Yeah, I’d love for you to unpack that. And one of the things that would be helpful is just what was your first maybe connection? Talk about your first framework where you’re like, ah, did somebody tell it to you? Did you discover it and build it on your own? What was kind of a first aha moment with the framework?

Finding the right framework

Josh: It’s been an evolution, really. I wish I could say that I had this brilliant idea and here’s this cool framework model thing. It really wasn’t that. I think is that as you start learning lessons and start finding out patterns, many of which were, because you stepped in a field on a landmine, you made something really bad happen. I don’t want to do that again. Oh, that informs the framework. I think a lot of it is just sort of life and business lessons learned over many years. I ended up writing a book about 15 years ago. I’m very passionate about human creativity. And of course, as a musician and entrepreneur. So, I did a lot of research on human creativity, how the mind works, how we can take creative ideas and apply them to practical outcomes. I’ve since written four books, and like anything you get more practice, you get better at it. And very often books, when you’re trying to get your ideas into a 250-page book, it requires a framework. I actually think that the act of writing those books help me sharpen the frameworks that I then use and share with others.

Chris: Okay. That’s great. Well, I think one of the things that would be interesting to hear you talk about is this idea of micro innovations and how you have applied those in business, and where does that come from? Where’s this kind of idea of micro innovations come from?

Josh: Yeah, my most recent book was called, Big Little Breakthroughs: How Small, Everyday Innovations Drive Oversized Results. And the project started out, I had this sort of crazy mission in mind. I wanted to decode how do the most innovative leaders think and act. What do they do every day? I spent over $1,000 in research. I interviewed CEOs, billionaires, celebrity entrepreneurs, Grammy Award-winning musicians and lots of other folks in different parts of life. And I really tried to understand, what do they do? What are their habits and tactics? What I found was fascinating. We have this misconception that most innovative people swing for the fences with every pitch. They take consistent high risk moonshots. The truth is they do the exact opposite. It’s really more about cultivating a high velocity, high volume of these little micro renovations. Think about them as like two or three a day, not once a decade.

And what ends up happening is that creativity starts to become something that you are not something that you do. It actually becomes part of your identity. And actually, by practicing on the small ones, which do by the way, add up to big things, it actually you’re building skills which then ultimately allows you to find the even bigger breakthroughs that you seek. So, it’s a much more pragmatic approach to innovation that’s practiced by many of the people that we admire most.

Chris: Oh, man. Well, writing a book is, I’d say a tall order for a lot of people. What was it like writing your first book? Did you just decide you were going to do it or were you approached and had you done it before? Had you been writing?

Josh: I’d written a little bit. I’ve always loved the written word and the spoken word, of course. But no, I wasn’t a professional writer. And I had this topic that was weighing heavy on my heart. And the theory was just that research that I read at the time. And now of course, 20 years later, done a lot more of it. Was pretty clear that all human beings have deep creative capacity. If we’re breathing, were creative, we’re hardwired to be creative, but the vast majority of adults don’t believe that they’re a creative person, which kind of breaks my heart. Because we creativity with things like painting or music. But you could be creative as a sales professional, you could be creative building your company or in a team meeting.

So anyway, then I looked at the world and realized that there’s all these challenges out there. Some are opportunities, of course, but some are real problems, racial inequality, ecological challenges, et cetera. And so I said, “We’ve got all these challenges and we have the resources inside of us. There’s 7 billion people walking around with dormant creative capacity. And if I could help build a system to unlock it and deploy it, the world would be a better place.” I actually felt called to write this book. It wasn’t just like, “Hey dude, I want to write a book.” It was a real sense of meaning and purpose and trying to share not just lessons that I’ve learned, but more of a broad sense of research to build a systematic approach to scale creativity.

That book was called, Disciplined Dreaming: A Proven System to Drive Breakthrough Creativity. And no, I’d never written a book. So yeah, it was absolutely painful. And being a little bit foolish, I did all the research myself. I didn’t have a single research associate. I wrote every word myself. I didn’t have any writing partners or anything, and I sort of muscled it out. But when you do that, you build your skills.

Chris: Yeah, you definitely build your skills on that. One of the things that you’re talking about with creativity is the act of doing something creative, it requires self-leadership. Because you have to do something about it. You got to take a step. And I wonder, what’s your connection between creativity and leadership? What are some of the things that you think about when you’re thinking about leadership in the mix with creativity?

Josh: I think especially today more than ever we’re being called to lead in a different way. The leadership models of the past are largely becoming irrelevant, really. I mean, in the world of AI and rapid change and volatility. I think that all leaders are being required to be creative leaders. In other words, there’s no checklist to follow anymore. And back to my jazz, which sorry if I beat that to death, but I think the old model was that of a classical conductor. The leader’s job was around precision, accuracy and alignment. Get everyone to play the notes exactly as Mozart intended. I just don’t think we have that luxury anymore. Today the world’s too fluid and too volatile. We have to play the notes, we have to perform at our best, and they’re not in front of us. There’s no checklist of success. So we have to be more like a jazz musician. We have to be adaptive and fluid and constantly changing, improvising to deliver the best possible outcomes.

So maybe in the past, a leader could get by being sort of rigid and methodical and detail oriented. Now those are just the anti to play, many of which will be automated. I mean, the one thing that can’t be automated or outsourced is human creativity. And that’s where I think leaders are going to shine. That becomes the single point of sustainable competitive advantage.

Chris: I love that. And I mean, if you think about improvisation, right? And obviously jazz, there’s a lot of improvisation. You only have your framework of you got the root note that you got to get back to. And I think one of the things that’s really interesting about improvisation and working with others, if you’re going to go do something, build a business, evolve your business, something like that, you got to have a plan. And it would be great to hear you talk about the connection between improvisation and perfect planning.

Josh: Yeah, the notion of perfect planning is probably not even a true thing. Because there’s no such thing.

Chris: Totally.

Josh: And I think even heavy planning in general I think is probably overrated. Because what happens is almost every business that I’ve been involved in, whether it’s an investor or an entrepreneur, and that’s well over 100. The original plan never manifests exactly the way you think, because the world changes. And as you get into it you might change and pivot your company a bit. And so I think it’s important to plan. Obviously, I’m not suggesting we run into something unprepared, but I think that the notion of a good plan is one that has adaptability, that there’s checkpoints along the way where you recalibrate, reassess, and then make any adjustments needed to continue to go on. I think that this idea of locking your sights on a plan and being tunnel vision and rejecting new inputs is foolish. Whereas the notion of you have a direction that you’re going and then you kind of adapt as you go, you recalibrate the compass in order to drive the best possible outcome.

Chris: Yeah. In planning for me, I think we spend most of our time trying to wrestle what the most important work is and try and galvanize our commitment as a team to really do the most important work. And I think that’s one of the things about the adaptability that’s great. Is you can set goals and set your priorities and things like that, but you got these new circumstances as they evolve and change. And the adaptability factor is really, really huge. And so do you have a framework that you use to sort of identify the most important work that you’re going to set out to do as a team?

Josh: Yeah, I do. But just backing up a second, what I might say your plan is actually more of a philosophy or operating model. And I think that’s actually the right way to lead, which is philosophies, values, operating models. So you’re saying, Hey, we’re prioritizing going to do the most important thing at the moment, but you’re not saying we’re doing one followed by two, followed by three. And so I think when you get too detailed of a plan, it becomes restrictive. Whereas if you have a philosophy, that philosophy, that value system or operating system can withstand change. And it sounds like that’s exactly what you have.

Chris: I love that. I love that. Well, how do you decide on the most important work?

Josh: Well, I think, by the way, anchoring it back to where you’re headed. If you have sort of overplay the idea of a vision or a mission, but essentially saying, “What’s the desired outcome?” And then you sometimes don’t know. And that’s the beauty of it. We don’t have to know as entrepreneurs, what we have to do is we have to experiment. And so I think the often overlooked part of both innovation, which I studied, and entrepreneurship, is the notion of experimentation. We think mistakenly, come up with an idea in the shower, just do that and it’s going to materialize. And that’s very risky. I’d rather people come up with a whole bunch of ideas and then test them cheap and fast, like 15 minutes and 20 bucks cheap and fast.

If you say like, “Hey, I have an idea to get this new customer on board,” instead of saying, “This is it, I’m going to roll it out across my whole company and print a training manual,” I would test 20 different things. Little teeny micro experiments. Discard the ones that don’t show promise, double down on the ones that do. And when one shows promise, don’t go crazy. Just expand the size of the experiment. And by the time you actually get to rolling something out company-wide, you’ve taken 90% of the risk off the table. So to me experimentation is the antidote to entrepreneurial and innovation risk. And what I’ve learned is that the best leaders are the best experimenters, the best innovators are the best experimenters.

Chris: Well, give us a story about that? Because that would likely be intimidating to a lot of people. It’s like, “What do I experiment with? How do I do this?” What was the thing you said, it was how much and 20 bucks or something like that?

Josh: Yeah, 15 minutes.

Chris: 15 minutes, 20 bucks or whatever. Talk to us about a story where that actually you brought that to life? At the beginning, what was the hypothesis? What were the tests, and then what was the decision?

Strategies to boost creativity

Josh: Yeah, so I’m running experiments all the time. I actually think that good leaders should run 10 experiments a week, and they can be really small. Let’s say I have a new idea on a way to interact with one of our portfolio companies. So instead of again, printing a training manual and just I’ll try it with one on an afternoon, and afterwards I’d say, “How did that feel for you?” And they’ll say, “Oh, it was awful. I hated it.” “Okay, stop. We won’t do that again.” I think, “Oh, that was pretty cool, was helpful. Oh, is there anything I could have improved on? How would you refine it if I was going to try that again?” And so they don’t have to be like a formal, you write it down wearing a lab coat with a clipboard, they can just be these little tests that you’re doing all the time.

But I’ll share one entrepreneur, one that I just learned about, which I thought was so cool. It’s a little bit bigger scale. It turns out that Hollywood studios that produce big motion pictures, the average success rate is 36%.

Chris: Wow.

Josh: So 36% of major motion pictures that have millions of dollars investors and A-list stars, 36% is their hit rate. Said differently, 64% don’t work, very low. Enter Reese Witherspoon. So Reese of course is a wonderful actor, but she also is a business person and she has a production company called Hello Sunshine. Well, she wanted to change that model, like, “How can I have a better success rate?” And her answer was experimentation. But she did it in a really clever way. Reese launches Reese’s Book Club, and she now has three plus million fervent followers. Every month she launches a new book.

And there’s real value, by the way, it’s not a trick or anything, but here’s the cool part. Before she promotes a book, she signs a deal with the author and she now maintains at a very low cost, all the production rights, the movie rights, the derivative rights, et cetera. Then she launches it and promotes the book and she measures it. It’s an experimentation laboratory. Some books do well, some books don’t do well. And then when she has one that blasts off like, Where the Crawdads Sing or Gone Girl, now she’s got data and evidence because she was an experiment. So now she can walk into Apple to produce a miniseries, or she can walk into Paramount and produce a motion picture. She can negotiate a better deal. There’s a higher probability of success. She bought it on the cheap. And so Reese’s success rate, instead of 36% of that of the motion picture studios is 90%. She took 90% of the risk off the table. And just following up on it, last year she sold a portion, not all of her business for $900 million. So, it pays to experiment.

Chris: You could say that, especially for her. And the idea of feedback is risky for people, right? Because it’s almost like putting yourself out there with 20 experiments you got to be really open to feedback. What are some of the, you do a lot of mentoring, you also have a lot of experience. How do you create maybe a safe place to experiment and be able to receive feedback or give feedback?

Josh: I’m so glad you said that, because in studying human creativity I’ve learned that the biggest inhibitor is not natural talent. That’s something we all have. We can develop those skills, but we all have it at the core. The biggest inhibitor is fear. And fear is that sort of poisonous force that robs us of progress often. And simply put, fear and creativity cannot coexist. And so you’re right, as a leader, if we can remove the fear, creativity will blossom naturally, which gets right into experimentation. The first thing is that you want to do experimentation in a relatively safe environment. In restaurants they have a test kitchen. If you’re trying out a new recipe, instead of doing it on a busy Saturday night and potentially upsetting guests, that would be a high stakes risk, you could do a low stakes risk. You have a little test kitchen in the back and you test little things and give free samples to your friends or customers and get feedback that way.

And so, creating psychological safety is crucial. And the way to do that, sort of lower the stakes of the experiment. The other thing, and this is a really important piece, is trying to remove identity tied to the experiment. In other words, if I’m a restaurateur and I invent a deep-fried chicken egg roll, and it doesn’t work, instead of I didn’t work, the egg roll didn’t work. It wasn’t that I was a failure, it was that that experiment was a failure. And so it’s hard as entrepreneurs because we’re so intricately wound up into our businesses, and I’ve experienced this myself. But I think the more we can remove our identity and say, okay, I tried something that didn’t work, rather I didn’t work, or I’m a failure, or I should be ashamed. There’s nothing to be ashamed of. And actually the best entrepreneurs and I’ve hung out with the best of the best billionaires, et cetera, they win more, but they also fail more.

And it’s something that isn’t often talked about when you read Fast Company or whatever, but if we want real innovation, we want real entrepreneurial success, we’re going to have to tolerate some setbacks and mistakes along the way. If not, we’re not going hard enough and we’re not trying hard enough. So once we acknowledge that, that’s part of the process, we can remove judgment and just look at it as data. And then the notion is like how do you adjust that failed experiment to make it one that is productive?

Chris: The removing identity is a really huge thing, and I don’t think that if someone struggles with that, that it comes naturally to get out of it, and to stop doing it. So have you encountered either someone you’ve mentored or portfolio company leaders or yourself, where that struggle with being attached to the outcome and your identity being wrapped up in the thing? Is that common? Is there a way to get out of it if you’re in it?

Josh: Yes. Yes, it’s common. And yes, there’s a way to get out of it. And essentially what that is, is projecting a new identity. First of all, sometimes people can just say, “Okay, I’m going to separate myself from the idea.” But if that’s tricky, which by the way, it can be, I’ve developed some fun tools. One of my favorite tools that I’ve shared all over the world is a technique called rolestorming, R-O-L-E. We all do brainstorming. Brainstorming by the way, is a terribly flawed approach. It’s designed to give you mediocre ideas, because inherent in brainstorming, you are taking responsibility for the idea. If I share an idea and it’s bad, my boss yells at me and I get that sting. I don’t want to share my crazy half-baked ideas, I’m afraid. So again, fear is creeping in. And because your identity is tied to the idea, we tend to share only our puns of notions.

Rolestorming fixes that. So, rolestorming is brainstorming in character. It’s very fun and simple. You just pick anyone that you want to be. Let’s say I’m rolestorming as Steve Jobs. Well, if I’m in a normal brainstorm session and I share a wacky idea and everyone in the room yells at me and I feel foolish and laughed at, I’m gutted and humiliated as a person. On the other hand, let’s say I’m playing the role of Steve Jobs. Well, no one’s going to laugh at Steve for coming up with a big idea. They might laugh at Steve for coming up with a small one. So, now I’m liberated. I can say anything I want because I’m not personally tied to the idea. That was Steve’s idea, not my idea.

And you’re asking for a story. One time I did this with a group of executives at Sony Japan. I met this dude. He was the stiffest human being I’d ever met, dark suit, white shirt, his tie is like strangling him. Anyway, I got him rolestorming as Yoda. I’ve never seen personal transformation like this. This guy’s jacket’s off, his ties undone. He’s leaping around the room. And more importantly, the whiteboards were filled with ideas. I didn’t teach him to be creative. He had that inside, as do we all. But previously the role he was in forbid it. And simply by doing this role shift, you put him in a new role that took the identity away and allowed him to really pour his creative heart into the project.

Chris: I love that you got somebody like that to play Yoda. That’s amazing. I wonder, okay, so rolestorming, just so that I understand this a little bit better. You are taking the person away from the idea. You’re able to get them to, you called it projecting a new identity and allow them to play something that people are already familiar with. And it liberates that person to act that way. And you also get some of the ideas to come out.

Josh: Yeah, you’re brainstorming as if you’re somebody else. And by the way, let’s say there’s eight people in the room, each person chooses their own character. One person could be a famous inventor, you could be a movie star, you could be an athlete, you could be a villain, you could be a 6-year-old kid, you could be an alien from a different planet. But the idea is you stay in character. And I know it sounds a little goofy, but I’m telling you man, it is such a powerful technique because you’re separating your personal identity and your personal outcome, responsibility, from your creativity. And the thing is, what happens is we have executional brain and an analytical brain and this creative brain, and we tend to in this country have deeply developed analytical brains and not as developed creative brains. So when we start throwing an idea out, the analytical brain pounces and extinguishes the creative flame.

You’ve seen it. You’re in a meeting and one person has an idea and everybody else comes, becomes the idea police and they tell you why it’s not going to work and it won’t fit in the PowerPoint and the boss isn’t going to like it. So what we’re trying to do is remove those two and separate them for a bit, send that analytical brain out to Starbucks to let your creative brain really flourish.

Chris: Yeah, I mean that works when you’re trying to ideate in order to reinvent or fix a problem or something like that. Do you have any other techniques to get people to operate with a higher level of authenticity? Even if it’s just one-on-one and you’re trying to understand them better or get them to think differently or things like that? Do you have any other tools or techniques that you use to get people to more operate in some authenticity?

Josh: Yeah, so another thing that we tend to do as human beings is we mentioned pattern recognition earlier. Which is a good thing generally, but it also could be a hindrance. Because once we figure out what works, our instinct is to just keep doing that again and again. In other words, we become set in our ways, we can become complacent. There’s that saying, “If it ain’t broken, don’t fix it.” By the way, that’s the dumbest saying ever. We should all remove that instantly from our vocabulary. That’s terrible advice. Why would you wait until something is broken before getting on with an upgrade? Anyway, I digress. Back to this notion of technique. A good way to shake people out of that. And you mentioned connecting to their authentic self and coming up with new ideas. It’s another technique. It’s probably my favorite one. It’s so simple and so powerful. I call it the judo flip.

Here’s the way it works. You’re trying to solve a problem or seize an opportunity, and you first say, “Well, how would everybody else in my field do this? What’s conventional wisdom? How have I always done it in the past? What’s my instinct telling me to do?” And then just ask a simple question, “What’s the polar opposite? What would it look like, instead of just proceeding with tradition, what if I judo flipped tradition? What if I did the opposite?” And that simple little mental model, you flip it upside down, oh, what’s the judo flip again? I know it sounds almost goofy that it’s so simple, but it’s so powerful. I’ve had people call me years after I’ve told them that, “Hey man, I was in a board meeting. We had this mission-critical issue. I was stuck on it and we didn’t know what to do. And someone said, ’Try judo flipping it.’ And we found the answer.” And so it doesn’t have to be complicated to be effective. And that’s one very simple technique that can really get you thinking through solving a problem in a radically different way.

Chris: All right, where’d you discover that one?

Josh: Just a lot of practice to a degree, but also get back to my musical roots. Some of the most prolific jazz musicians did that, and that’s how they became so famous. My old time hero is John Coltrane. His most famous work is a piece called Giant Steps. And in Giant Steps there’s sort of a rule, like, “Here’s how chords are supposed to go in a jazz song.” And he broke the rule as far as you could break them. He literally broke it as far as you could break it, that’s why it’s called Giant Steps. And it became not only his most important work, but it’s considered in the top five of all jazz songs in history. And it’s a good reminder to me that he didn’t succeed by complying with tradition, he succeeded by breaking it. He gave it a judo flip.

Chris: I love it. Well, I don’t know. Being a founder, how is that different? If you think about it, being a founder, you have to build teams. And then as a VC, yeah, you have teams, but you’re building a different collection of teams. You’ve got the portfolio companies and then the team making the decision to where to invest and all of the operations around that. What are some of the things you do to identify talent that are maybe common across both, that when you’re building teams, some of the ways that you think about people and culture?

Leading by lifting others up

Josh: Yeah, awesome question. Well, one is back to models with Jess about earlier. Over the years I developed my own sort of operating system and I’m happy to share it with you. I’ll share it and you can put it in the show notes and feel free to anyone who’s listening to borrow it, that’s awesome, or create your own, either way. But I try to really operate business based on philosophy like you were talking about here. And so some of mine are, give generously, don’t keep score, which is the notion of this sense of abundance and generosity spirit. One is the idea of constantly putting ourselves out of business. I had a saying as I built my companies over the years that someday a company will come along and put us out of business, might as well be us. One of them is the idea, the no asshole rule, which is around, “Listen, life’s too short for grumpy jerks. Let’s be supportive of one another.”

We can confront the brutal facts, we can speak the truth, but we don’t have to do it in a way that beats people down. We can lift people up. I developed these sort of 14 operating principles. And as I’m deciding whether or not to invest in a new entrepreneur, I’m far less oriented to that person’s resume or technical skills. I’m much more oriented to cultural alignment, because the technical stuff will change and evolve. As you grow, you can always learn a new skill, but the values alignment I think is crucial. And so actually, as I was building my companies, I reverse engineered interview questions against our values, and so we would really interview much less on resume and skillset and much more on value set.

Chris: I love that. What’s one of the questions?

Josh: One of my favorite questions that I would ask is, “Hey, we’ve all made mistakes. I’ve made dozens of them. I’ll make many, many more. What’s an example of a mistake or a failure that you’ve had?” And so, all I’m looking to do with that question is to see where they assess blame.

Chris: Yes.

Josh: If they say to me, “Oh, I had this great idea and the client screwed me over and the bank pulled out and my boss is a jerk,” and they’re blaming everybody else, that person has Victimitis, it’s an incurable disease, I can’t work with them. On the other hand, if they say, “Yeah, I went for it, I had good intentions, my numbers made sense, it didn’t work out, and here’s what I learned from it.” Awesome, let’s go. And so in that case, I’m testing for this notion of personal responsibility as opposed to playing the victim card.

Chris: Yeah, I mean, that’s really awesome. I have a similar question that I asked, which is like, I want to talk about this double-edged sword of who you are as a person. What do other people say about you? What’s the biggest compliment you’ve ever received and what’s the toughest criticism? And I totally agree. I would say people who worked with me a long time ago, the asshole syndrome thing or it was like, what was, it was the third thing you said was the no asshole rule. I was like, “Man, the outcome is what matters and how you get there matters a lot less.” That was my original sort of thinking. And then when you’re building bigger and bigger machines, how you get there, I mean it matters 10X more than you ever would’ve thought. And the people that you do it with, if there’s a values mismatch, the outcome is the odds of getting to the outcome are way less possible.

And so I really, really think that adaptation to a common culture and hiring for culture and for a value system matters way more than aptitude and pedigree and all those other things, especially with leadership.

Josh: 100% agree. Actually, on two different dimensions. One is, when you do succeed, you want to do it with a big open heart and you helped others succeed with you. And that’s a celebration. To do something and win in a state of integrity versus cheating and cutting your weight to success, you’re going to have a very, very different feeling in your heart. So there’s an intrinsic reward in other words. Second of all though, people used to think mistakenly that the things like kindness and generosity and compassion were weaknesses, tough business people don’t do that. In this modern era that’s nonsense. And actually, those are not weaknesses at all, they’re assets. And so my opinion is that by showing up that way, you are not only going to enjoy a win and feel good about it, you’re much more likely to enjoy the win in the first place, because that’s how you ultimately create value.

Chris: Oh man, I love that. Tell us a little bit about maybe an observation where you ... Have you ever compared two founders and you see some similarities and when you’re telling the story about the two individuals, there’s just this one thing that got the other person the cutting edge, that wasn’t a lucky break? It was something they were doing out through their value system that gave them the cutting edge?

Josh: Yes, absolutely. I’ve invested, I’ve done all kinds of experiments in terms of investing one time, funny enough, almost in the same month I invested $600,000 in two companies. One was like A team with a C idea, the other one was A idea with a C team. And like clockwork, here’s what happened. The A team turned the C idea into a idea. We had 80 X return on capital. And the other one where there was a idea with a C team, they managed to screw up the idea. I took a total zero loss every single penny of my investor. So it really is even in technology, I think it’s a people business, which is why our venture fund, Mudita Venture Partners, we like to say it’s a venture firm with a soul. And we really very focused on the humans behind the technology, not just the technology itself. But one core attribute that it seems counterintuitive. We think about the prototypical entrepreneur, this larger than life charismatic figure that is demanding and mercurial, the Steve Jobs prototype, I think he was an outlier actually. I don’t think that’s the right model.

And what I’ve seen works much better is humility and open-mindedness and grace and willingness to give other people the credit and living in a state of balance and integrity. And so those to me are the ones that drive enduring success. And those aren’t often what’s featured when we’re talking about an entrepreneur.

Choosing investments that align with your values

Chris: Oh man. Well said. Well, there’s a lot of choices that you’ve made at Mudita and the VC firm with the soul. It’s a pretty cool way of thinking about conducting yourselves. Tell us a little bit more about how you select, I love what you talked about with selecting, “Hey, I can work with this person,” with you’ve got sort of a common values fit, but what are some of the other ways that you pick your investments?

Josh: So every fund is different, so I’m not saying our investment thesis is better or worse. It just is what ours is. Just disclaim that for a second. First of all, the word Mudita, which most people don’t know, it’s M-U-D-I-T-A. It’s a Sanskrit term, which means taking joy in other people’s success. And there’s no greater feeling in life. Your kid gets an A in school, your best friend gets a promotion the way that you feel inside, even though it’s not your success, the joy that you feel for someone else, I don’t think there’s a better feeling on the planet than that. And so we purposely chose that name because we want it to be a different kind of fund, one that was uplifting rather than the typical ruthlessness and beating people down and extracting every cent. We wanted to build a firm with love, not with just financial gain in mind.

Accordingly, our Everest that we’re working toward is to return one billion of capital to investors while returning one billion of good to the world. And so we only invest in companies that we think are going to do both. If someone came to me with this awesome new french fry technology and it’s going to make a bunch of money and it’s going to help obese kids become more obese, no thanks, I’m not investing in it. I’m just not. We only invest in things that we think can be both an economic win and a sort of society and humanity type win. That’s one of our first criteria, and we literally won’t invest. If everything is the greatest thing ever, I just won’t invest it unless it’s got that.

Chris: Love that.

Josh: But beyond that, so that’s a values alignment thing. We then look at sector and stage, so we invest in certain things. We don’t invest in hardware. We mainly invest in B2B software, so that narrows it down. We mainly invest in companies that are post-revenue and pro-growth spurt, and that’s our sweet spot. Not everybody’s, just yes about ours. If it’s just an idea on a napkin, it might be too early for us. If the company’s already doing $100 million in revenue, it’s probably too late for us. So, we kind of have a band where we like to connect.

The other thing is we want to ask ourselves is, is can we add material non-monetary value? In other words, if the only thing I can bring is our checkbook money is fungible, anyone can do that. But if I can bring our checkbook and I can help make it introduction to get you your first customer, or I know the perfect CTO, or I’m best friends with the CEO of a company who could be your distribution partner, that’s a different story. And so we really believe in this notion of active investing where we can be helpful partners rather than just financiers. And so those are some things that we look at, but we do heavily weight on the entrepreneur and the cultural alignment.

Chris: Are there any other criteria that, for example, a lot of the accelerators nowadays, and I do in a second want you to walk through the stages, right? Because I love the bands that you were talking about. I’d like to walk everybody through that a little bit. But a lot of the accelerators nowadays, especially that are investing in or invite people to the program that are tech companies, they want a sort of visionary, they want the sort of founder leader and then they also want a co-founder, right? And so is that something that you guys look for as well, or is that sort of like it’s a icing on the cake if it’s a co-founder led company, you got the tech person and the visionary or the leader?

Josh: Yeah, there’s lots and lots of different models. There’s companies like Y Combinator, which essentially is like a training program for entrepreneurship, and then they help you launch your company. And Techstars is another example of that. Awesome, I have deep respect, lots of love. We’re not exactly a training program, so in our case we’re investing, once a company’s already running and they’ve proven product market fit, they’ve proven they can get a customer and keep a customer. They’ve proven they can build something. And so at that point, to us it’s less important is there this ideal Batman and Robin pair of visionary and technical founder, because they figured out how to get something up and running. And so those are nice to have, but I think if there’s a hole in any executive position, really we could maybe be helpful in filling those holes because the team that’s needed at one stage is different as a company scales. And that’s actually one of the core things that we do is help founders find really experienced executive talent to augment their existing team and continue to grow.

Chris: Got it. So you help people build out a leadership team often?

Josh Linkner: Yes.

The funding stages for an entrepreneur

Chris: Okay, great. And that’s where the networking and all that really comes into play. Well walk us through a little bit of, let’s just talk about the spectrum of funding that entrepreneurs would have and you can keep it in the software tech space. Because I think that that’s where probably both of us are most comfortable talking, but you’ve got this friends and family initial seed round all the way to maybe a private equity exit or going public on the other end. Talk to us about the range and how you in the industry and this whole funding sector, talk to us a little bit about the range of those options and maybe some of the pros and cons along the way?

Josh: Yeah, so very early on, as the company’s just getting started, there’s lots of options, of course. There’s friends and family who you mentioned, sometimes there’s debt, so you can borrow money and maybe provide some bigger return or bigger interest rate to borrow money to get something up and running. And again, there’s not a one-size-fits-all. It depends on your business, the growth trajectory, what you’re hoping to get. Is it a lifestyle business versus a enterprise business, et cetera? So, that first stage is generally called seed. How do you seed the company to get it up and running with the initial bit of capital to get going? Now, some companies become profitable, largely services businesses that aren’t as capital intensive. That might be all the capital you need and you take it on all the way. And so that’s okay. But other companies that are more capital intensive software companies generally do require additional capital as they scale.

And so first you go to seed, and then sometimes there’s this thing, so generally it goes in letters like there’s seed, then there’s series A, series B, series D, et cetera. But in between there’s a lot of gray area. Where we actually tend to invest in is in between seed and what’s called series A. Series A. These days there’s been a bit of money inflation. A series a check might be a 12 or 15 million check, and the company might be valued at least on paper at maybe $40 million at that point. But there’s a lot of white space we believe in between seed and that series A, which is where we play. We’re sort of the first institutional capital. Often we’re coming in after friends and family or maybe after a little angel fund or whatever, and we help them prepare and get up to that series A stage.

So at that point, a company might be doing $10 million in recurring revenue. They’re growing pretty quickly. There’s a thing in private equity called the rule of 40, which basically means that if you add your growth rate and your profit rate, they should be 40 or more. So, if you’re growing at 40% and making no money, great, you’re at rule of 40. If you’re growing 20% and making 20% profit, you’re at the rule of 40. If you’re growing 2% and making negative 4%, you’re not at the rule of 40. So it’s just a benchmark, it’s a rule of thumb, but that is one thing professional investors look for.

Then you get into series B, and now you might be writing a much bigger check. So now you may be 25, $50 million even, and the company’s really got some scale. And then as you might imagine, it continues to escalate from there all the way up to ultimately a public offering or an exit. The in-between spots are pretty interesting though. There’s lots of different ways. There’s things called bridge financing where people might loan money toward a company going from one point on that spectrum to the next, and then once they reach the next point, that loan converts into that new round. But that investor gets a little bit of benefit because they came in early to help them.

I’m not going to geek all on financing, because I don’t want to bore you, but there really are a number of different ways to launch and scale your business. And I think the fundamental thing you want to start out with is saying, “Do I have a lifestyle business or do I have an enterprise?”

There’s no right or wrong answers, by the way. There are people that have lifestyle businesses that have beautiful lives. They ski, they have second homes, they have beautiful cars, they take care of their kids. They’re wildly philanthropic. It’s not a criticism at all, but that type of business, capital wise you’re going to probably want to maintain 100% or more, or as close to it as possible. You can use things like debt, so you don’t have to necessarily give away as much in equity, and maybe you don’t want someone meddling as much in your business.

On the other hand, if your goal is to become the next Facebook or the next salesforce.com, you’re going to need more capital. And in addition to the capital, frankly, you’re going to want more support. It’s funny, I would say that in the same way we’re talking about cultural fit for employees, I’d strongly encourage any entrepreneur to think about cultural fit with their investors. So two investors could write you the same dollar check. One could be an absolute nightmare, constantly berating you for spending two extra cents on paperclips, and the other one could be the most helpful partner in the world helping to find customers and helping you when the chips are down and helping you to navigate difficulty.

And so I’d say, yeah, money is great, but that’s only one factor in making your decision. Really try to find an investor that you align with philosophically and that you could see working with because that is a pretty deep relationship over time.

Chris: Oh, for sure. One of the things that just as those funding stages progress. Dilution really happens, I’ll tell the founders and the earlier stage investors and things like that. And I had love for you to do a judo flip being on the founder side for just a second because familiar with that and how do you think about how demotivating that can be? Because guess what? If you’ve got multiple sort of investors and you’ve made a couple of interesting choices that you just talked about, you’ve got people speaking into the thing, how demotivating can something be as it relates to dilution? And are there things that founders can do to not necessarily keep it off for themselves? Because I mean, the investors are helping, they should be at least. What are some of the things that either, whether it’s dilution or other demotivating factors of the things that you as a founder would advise? How would you advise founders that are going through, either getting more and more diluted as they carry on or other demotivating roadblocks?

Josh: Yeah, so I’m going to separate those. Because I think dilution shouldn’t be demotivating at all. When you think about people who have had huge amounts of dilution, I’ll tell you a few of them, Mark Zuckerberg, Steve Jobs, Bill Gates, Elon Musk, they had a lot of dilution and I think they ended up okay. And so the real trick is not to think about it as dilution. I don’t even like that term, because that implies that you’re cutting out part of your body and giving it to someone else, and you’re becoming minimized. It’s like a very negative term. That’s really not what’s happening at all. If you have 10 million of stock, let’s say your founder stock is worth $10 million and someone gives you $3 million of equity, your stock is still worth $10 million. You’re not being diluted money wise, now you’re being diluted percentage wise, because now the overall company’s worth $13 million, not 10.

But keep in mind, if you can turn that $3 million into $3,000,001, you made more money, you’re better off ahead. So I would strongly encourage people to not think so much about percentages, but to think about dollars in value creation. Because if you try to be protective and scarcity minded and like, “Oh, I’ve got 100% and my company’s worth $5 million.” Or if you’re like, “Hey, I only have 10% of my company, but it’s worth $10 billion.” Yeah, I’ll take the dilution.

Chris: For sure.

Josh: I think I really wish we changed that term, it should be something else, because you’re really not something up. What’s happening is someone is giving you capital to ride alongside you and help you build your vision. And ultimately, if that capital even expands a little bit, you’re still better ahead. You’re still better off.

Chris: Yeah, well said.

Josh: And by the way, the only way you really are diluted is if you take that person’s capital and squander it. And my little example, if you took that, now your company’s worth 13 million because you took three million in fresh capital and you now blew it, and now your company’s only worth 8 million. You have some responsibility in that also.

Chris: You bet.

Josh: So anyway, that’s the dilution. That being said, there are many things that can be demotivating as a founder.` I actually don’t like the term entrepreneurship, by the way. It sounds too pleasant. It sounds like this lovely French word. And we’re sitting out sipping tea and wearing white gloves, and it’s this very calm, lovely thing with sniffing lilies. Entrepreneurship is like a street fight, man. You have this idea and you pour your heart into it, and you get punched in the face, and then you get back up and someone sucker punches you again.

It’s kind of a blood sport. And so I think that what happens in entrepreneurship, unlike someone in a traditional career, is you have high highs and low lows. One day you win the account, you get the capital, and you feel like you’re on top of the world, not just money wise, but I’m creating something. I’m bringing my vision to life. Super high emotional. Then what happens? You blow it, you lose a customer, a team member quits, whatever, and now you feel like, “Oh, I’m just gutted. My identity is tied to this. I feel like a total loser.” And so what I’ve learned over the years is there is this oscillation. And so now when I have a real point of joy and success, I feel the moment, for sure, but I’m not over the top elated. I’m not drunk by it. And then when I have a moment of suffering, of pain, of setback, I also am not crushed by it, because I recognize the oscillation going up and down.

And so I think as an entrepreneur, it is going to be a bit of a roller coaster. That’s just how this sport is played. And so give yourself a little grace. On the highs, absolutely celebrate the moment, but don’t become cocky and arrogant about it. And in those lows, recognize that it is a cycle and you’re likely going to bounce back and cycle back up.

Chris: Yeah, that’s really good. Well, in your portfolio, what’s a company that you’re most recently really excited about?

Josh: You and I both have four kids, and it’s hard, because it’s like saying, “Which is your favorite kid?”

Chris: I know, right?

Keeping up with AI

Josh: But there’s a couple man, one company, we were actually the co-founder of it, and about 20% of our capital goes to companies where we’re both the funder and the founder. We have what’s called a venture studio, so think of it as an innovation laboratory. And we’re constantly testing new ideas and prototyping. And very few make it all the way through, we discard most of them. But when one does, then we hire professional management and launch it as a company. And so, one we recently launched, it’s pretty cool, it’s called Official AI. And so you’ve probably seen people using deep fakes of celebrities like Drake and all that. And so that’s a problem for lots of reasons, copyright infringement, it hurts the artist, et cetera.

But we thought, “Well, what if there’s a way that it could be a licensing model instead?” So, we’re using AI and technology to create this sort of digital platform, a licensing platform for official licensing. Let’s say you played piano and you’re like, “I really want to write a song, but it would be cool if it was Billy Joel’s voice singing it instead of mine.” Well, you could go into open AI, official AI, I’m sorry, and be able to say, “Oh, Billy Joel’s in here. He’s willing to license it under these terms.” And now you could create a new piece of art using Billy Joel’s AI voice, but authorized, not pirated. In this case, the artist gets a royalty, of course. And you get to use the artist’s name, image, or likeness. This can be applied for advertising. So you could imagine a TV commercial done with a celebrity, that celebrity didn’t have to go to the shoot, and it can be done in music and radio spots and everything else.

So, we’re trying to sort of connect artists and famous people with creators in a deeply secure watermark blockchain kind of way. So everybody wins together. And that’s actually just yesterday adage wrote about it as one of the top 12 sort of new innovative uses of AI. So we’re pretty excited about that.

Chris: Oh, I love that. I love that a lot. I would say a responsible way of deploying or employing AI. It’s amazing to hear you guys are doing that. It’s just AI. It’s the topic right now. And it would be great to hear from you as somebody who’s in B2B tech and placing bets in B2B tech. What are sort of the next couple of years of evolution when you’re sort of trying to think about where to place your bets and ones that you’re just interested in, not necessarily where you’re investing. Because probably you got a lot of other interests as well. Where’s this thing headed in your mind? AI, technology? Technology and business?

Josh: I’m just finishing a really terrific book called, The Coming Wave, which I’d highly recommend. I don’t know if you read it or not. It does a really good job of unpacking where AI is headed. It’s written by one of the AI pioneers. It’s terrific. Anyway, I think in my opinion, AI will be the biggest and most profound technical advancement since the internet itself. It will have dramatic implications on the way we work, live, love, et cetera. And it doesn’t have to be a scary thing. I think there are some things that will become scary, because it’s a tool and people can use a tool for good. They can misuse a tool for bad, and there certainly will be bad actors.

Chris: Just like the internet.

Josh: Just like the internet, just like a knife. You could use a scalpel to save someone’s life in surgery or you could murder somebody with it. So it’s not the tool’s fault necessarily. Obviously want to put safeguards as best we can in place, but I don’t think we’re going to be able to regulate it. I don’t think it’s a controllable entity. So I think it’s more about embracing it. I think that really every profession is going to be affected, and I think every professional will be affected. So imagine an AI copilot that is giving you insights and advice. It’s still you’re using your human judgment in your job. So I think many of the things that can be automated will be, which then you say, well, what’s left for us? And I think there’s actually a beautiful, what’s left for us. Answer that. It gets back to being a creative person.

We see AI writing a sonnet and we’re like, oh, AI is so creative. AI is actually not creative. AI can assemble ideas based on previous creation, but they’re not ... AI can’t create something truly net new. Humans can. And that’s one of the things that actually characteristically makes us a human being. And so I think what’s going to happen is some of the more mechanical tasks that we were trained in are going to be done by AI, which should, in theory, free us up to do some of the more creative tasks that truly cannot be done by AI. And so I really do see us living and working in a harmonious sense. It doesn’t have to be in conflict, it can be in concert. That being said, when we put our crystal ball hat on, we start thinking about it. I think it’s a fundamental question we have to ask. If AI was a hundred times more advanced than it is today, what would my industry look like? That’s a good question to ask. Because AI will be a hundred times more effective and soon.

Chris: Oh yeah.

Josh: I think it’s about getting ahead of those trends and trying to be on the leading edge of that disruption rather than having a thrust upon us.

Creativity as the currency of success

Chris: Man. Well said. If you think about, I don’t know, creativity as a superpower. I was going to say a skill, but more like a superpower. Because I like how you described AI versus what a human can do. What are some of the things that you can encourage entrepreneurs, leaders to do to foster creativity in themselves and in their teams?

Josh: I actually think it’s priority number one. I think it’s a leader’s fundamental priority, because value is being created in a different way than it was in the past. It used to be leader’s job was to cultivate compliance, now it’s to cultivate ingenuity. It used to be to cultivate, follow the rules and tighten the hatches. And now it is living in a state that’s more agile and fluid. What’s happened is, creativity in my opinion, has become the currency of success. And so a leader’s primary function is to help nurture and expand and unleash the dormant creative capacity of those on his or her team. So, I think it’s crucial. The way you do it. I mean, first of all, it setting up a safe environment, rituals and rewards are very effective. But actually in my book, I kind of talk back to frameworks, models. I have a few fundamental mindsets that I think might be helpful.

Chris: Yeah, share them.

Josh: One is, I write about the notion of, “Start before you’re ready.” It’s a little catchphrase. But the idea is, many times when we see an opportunity or a challenge, we tend to wait. We’re waiting for ideal conditions or a directive from the boss. And there’s something about putting yourself in motion, even if you can’t see the finish line sort of bob and weave in course correct and adapt the changing conditions. But it’s that fluidity of taking the initiative and going. That’s I think, an important idea. Another one is that a little philosophy I have break it to fix it, which is the opposite of it ain’t broke, don’t fix it. Which is really proactively challenging assumptions, challenging existing models with vigor. To me, the minute something is like, “This is the way it’s done,” I’m like, “Well, let’s see what the opposite of that is.”

And it’s almost having that instinctual recoil when someone says, “This is how we’ve always done it.” And so I think that’s a real notion of being in an ongoing state of reinvention. Another one that I like is the idea of seeking the unexpected. And so we tend to gravitate toward the tried and true, the things that have worked in the past based on historical reference. And I like it when people really push the boundaries and try something that out of the box thinking, but really like a weird approach because that could be a very effective strategy. These are some of the key philosophies.

I just give you an example of the weird one. So my wife, Tia and I, we had our twins, Avi and Tallia, and she was 26 weeks pregnant. We went to Las Vegas for a babymoon. She’s healthy, everything’s great. And she had a health crisis. And so we weren’t prepared for this at all, but she had to give birth at 26 weeks.

Chris: Whoa.

Josh: This is 14 weeks premature. It’s called a micro preemie, for those that don’t know. And this was very scary. I was thrust into this world of chaos that I wasn’t prepared for. Learning things about survival rates. Now I’m in a city out of my hometown, I’m in this hospital. We spent 104 days in the neonatal intensive care unit.

Chris: Oh my gosh.

Josh: Each kid had a heart surgery and for a while it was touch and go. We didn’t know what the outcome was going to be. By the way, they’re totally healthy and happy. Thank God.

Chris: Thank you for that.

Josh: They made it. I didn’t mean to create too much tension there. They’re great and they’re little monsters, so that’s good.

Chris: Well done.

Josh: But I have a lot of empathy, thank you, for what it’s like to be inside a children’s hospital. So anyway, the children’s hospital at the University of Pittsburgh, they wanted to create a better experience for families like mine. So you say, what are the obvious approaches? Softer pillows, better lighting. Instead, they took an unexpected approach. You know what they did? They dressed up the window washers like superheroes. Now as they repel from the roof and doing their jobs, you got Batman and Superman and they’re entertaining the kids.

Chris: Wow.

Josh: No productivity was lost, had to clean the windows anyway, but now it’s like a total game changer. The kids look forward to it for days. They forget why they were there in the first place. It takes attention away from the medical care, and it’s actually better for the window washers because they were previously doing a mundane job, and now they discovered purpose and meaning to their work. And so to me I love it, because it’s an unexpected approach to solving a real-world problem. And back to the idea of micro innovations, big little breakthroughs, just to be clear, that did not make a billion dollars, but it did make a difference. I think about opportunity as humans, as creators, to bring ideas like that to the surface all over the place. And those can make a huge impact in our businesses and in our communities and all of those folks that we touch.

Chris: What would you recommend for people to help them implement micro-innovations into their daily habits?

Josh: Well, like most things, the more you do it, the easier it gets. And so give yourself a little grace. You don’t have to start by like, “Hey, I’m going to do my first thing and it’s going to be the Mona Lisa, and it’s going to be perfection and museum quality and all that.” Just do little teeny adjustments. Just try little teeny stuff and just test stuff. If it doesn’t work, don’t do it. It could be something really small. What if I move the coffee machine closer to where everybody sits and I can save four steps to get a cup of coffee? That’s an innovation. Why not? What if there was a different recording when someone goes to your call tree, when someone calls your business and you change that to make it more fun? That’s a micro innovation. It doesn’t have to change the world to be effective.

For some reason, we have this bar, unless it’s a billion dollars, it doesn’t count. That’s nonsense. These little teeny ones can really add up to greatness. Oh, man. The other thing I would say is that give a little bit of time for it. We’re all time constrained and most of our lives we spend head heads down. And when your head’s down, you’re doing your to-do list and what you got to get your deliverables. And nothing wrong with that. Awesome. But I do encourage people to spend a little time being heads up because when you’re heads up, you notice things, obviously your head’s down, you can’t. But when you’re looking around, oh, I notice what that competitor’s doing. I notice a pattern over here in a museum that I could apply to my business. I notice this other. So you really are visioning different things.

Here’s a little simple idea, because I’m more into these practical tools. I’ve issued this challenge around the world. It’s a 30-day challenge. It’s an experiment. I call it the 5% challenge. Take a 40-hour work week. I know we all work more than 40, but just bear with me. 5% of that is two hours a week. So for two hours a week for 30 days only, spend that being heads up and set of heads down. Schedule it on your calendar, like an important meeting that can’t be moved. And it could be two one hour blocks, it doesn’t have to be all at once. But the idea is during that time, give yourself permission to try Judo flipping some ideas or think about an unexpected approach, or combine two different things into something new. Or imagine what are six little ways that I could improve the situation that you’re struggling with?

Here’s what I’ve learned. It’s fascinating. I’ve issued this to thousands of people. First thing I hear back is a 0% drop in productivity, zero. Magically, 40 hours gets smushed into 38 hours. No one misses a beat. Second thing I hear back is that the first week you feel really awkward and uncomfortable. It’s like, oh, I’m frivolous. I hope no one catches me. You’re cheating on your spouse or something. Because we’re not used to that. We’re so busy being heads down. But by the end of the 30 days consistently, here’s what I hear. Most productive time I’ve spent in decades and most fulfilling and rewarding time I’ve spent in decades. And so then people sort of make it part of their daily groove, just scheduling a little bit of time weekly to be heads up instead of heads down. And what happens is, I said earlier is that this starts to not be an activity.

It’s more of a new identity. And back to, we talked about identity earlier. I’m not saying anyone should leave who they are, of course not. But there is a little piece of you that might be sleeping. And if you can bring that piece, let’s call it the artist, you can still do customer service, but you’re a customer service artist. You can still do finance, but maybe you’re a finance artist or you’re a legal artist, or you’re a sales artist. An artist doesn’t have to be snooty. You don’t have to wear a beret. But an artist is someone who questions things, who tries new ideas, who pushes the creative boundaries, who’s experimenting and tweaking, who’s willing to confront tradition instead of comply with it. And so when we awaken this artist within, and it just starts to feel really natural, and I’ll just share that it’s not only productive, it’s not only going to drive business outcomes, which it will. There are so few things in life that are deeply intrinsically rewarding as the expression of human creativity. So it’s like a double win. It drives business performance and it drives internal joy really.

Chris: Wow. Well, what would you say is next for Josh Linkner?

Josh: This sounds like a line, but it’s just, I mean, from the heart, I’m a jazz musician. Jazz musicians create things. They’re improvising their testing, and that’s what I still do. Sometimes I’d still do that playing music. I played a concert in New Orleans last week, and it was awesome. I love playing jazz. But sometimes I play jazz with startups. Sometimes they play jazz when I’m writing a book. And I just think of it as the same thing, which is like, how do you create something out of nothing, and how do you do it in a sort of an improvised and fluid way? So that’s where my heart is, that’s where it’s always been. And I get such deep joy in doing that, and I love sharing ideas like this. I mean, to me, this notion of Mudita sort of helping other people succeed, I feel like it’s a bit of a calling.

So, if I can help people unlock creativity, if I can help them soar in their business, it’s not only benevolent because I do care deeply about people, but it fills your heart in a way I can’t even describe. So that’s next for me, just more of the same. My wife asked me, she’s like, “Hey, when do you think you’re going to retire?” And that notion actually was weird to me, because if you’re doing a job, and I say this with respect, because some people have to do a job to earn money and they don’t like their job, it’s a means to an end. If you’re laying brick and you hate your job and you just want to get to the point where you don’t have to lay brick anymore, understand and respect that. I’m not being glib about it. But I have the great honor, the great luck, really, of being able to do what I love.

And so I don’t think about it as work. I think of it as play. Not that every minute is perfect, not that I don’t have a bad day, but I feel like I’m doing important work. I’m following a calling and I’m contributing to the world, and I get to learn and grow and meet cool people, and like, I’m never going to retire. Not because I can’t, because I don’t want to.

Rapid fire questions

Chris: I love it. Well, I would be remiss if we didn’t actually take you through some of our rapid fire questions.

Josh: Ready. Fire away.

Chris: What is the most influential jazz album that comes to mind first?

Josh: John Coltrane. Not Giant Steps, which I mentioned earlier, A Love Supreme. It’s been said by many musicians. It’s like a gift from God kind of thing. And so it’s literally a spiritual album. Love Supreme, John Coltrane.

Chris: All right. Second question. If you could master any skill instantly, what would it be?

Josh: Singing.

Chris: Okay.

Josh Linkner:

I’m working on it, by the way. Funny. I always thought I couldn’t sing. I had a total fixed mindset. At 50 years old. I’m like, why do I have that assumption? What if I just started learning to sing? So I’ve gone from horrible to bad, to just, not awful, but still pretty bad. But I’m going in the right direction. So I’m working on singing.

Chris: Upward trajectory. Third question. What is an app that you really can’t live without?

Josh: Slack.

Chris: Okay. Oh, okay. What’s your favorite jazz club that you’ve ever performed in?

Josh: Ooh, that’s a good one. Probably in Detroit, my hometown, Baker’s Keyboard Lounge. It’s actually the oldest continuously running jazz club in the world. It’s not the biggest, not the most famous, but everyone from Miles Davis, to John Coltrane, to Charlie Parker, Wes Montgomery, Louis Armstrong, Ella Fitzgerald, they’ve all played at Baker’s. And man, you can just feel the energy in the walls there.

Chris: That’s awesome. Well, if you could have dinner with any of those people, who would it be?

Josh: Well, I’m going to go back to John Coltrane, who was just, I think that Coltrane will be regarded in the same category as Mozart and Beethoven someday. I mean, he was just that prolific in his work.

Chris: All right, calling or texting?

Josh: Texting.

Chris: Morning routine in three words?

Josh: Coffee, coffee, coffee.

Chris: All right. One sentence or less, what’s one hack to spark new creative ideas?

Josh: One hack to spark creative ideas. We talked about earlier a couple of them, but I’ll give you one more. I call it the bad idea brainstorm. Set a timer for 10 minutes, and when you’re trying to come up with ideas, presumably it’s good ideas, set a 10-minute timer and try to come up with as many bad ideas as you can. Horrible ones, unethical, illegal, inappropriate, bad ideas. Then after that, don’t do the bad ideas. Examine them and ask if you can flip them to something legit. And what it does is it pushes you so far away from incremental thinking, way out there. Yeah, you should ratchet those back to being appropriate, of course. But you’ll discover things that you would have never otherwise considered.

Chris: Oh, that’s great. What’s the last or the most recent business book you read?

Josh: The most recent business book I’ve read, I think I would call it a business book. I’m still reading it right now. It’s called Positive Intelligence. And it’s not hardcore business, but it really applies to business. And it’s really about these saboteurs that live in our mind that try to undermine our performance. And how do you sort of conquer them and win without them.

Chris: Well dude, I appreciate you coming and sitting down with us. It was awesome to get well, actually, just to hear you unpack all of the things that you do every day and to hear just how you’re making a mark on the world. So thank you so much for coming and sitting with us.

Josh: Truly a pleasure to be with you. And thanks for doing this. I mean, you’re making a real impact in the lives of millions of entrepreneurs around the world, so it’s a noble pursuit. I’m grateful to participate.

Chris: Thanks, Josh. Appreciate you, man.