March 29, 2021 • 32 mins
Internet media trailblazer, Tim Armstrong, brings his business zen philosophy to the "Big Money Energy" podcast. Tim explains what it was like to be in the room at MIT for one of the first demonstrations of the internet. He also reminisces on the early days of working at Google before it was a tech powerhouse and how change can be wielded as a weapon when you're running a business.
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Episode Transcript
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Speaker 1 (00:01):
Welcome back to a brand new episode of Big Money Energy,
where we talk to super successful and self made people
to find out exactly how they did, how they went
from nothing to something. I'm Ryan Sarhand and today I
am pumped because I'm talking to Tim Armstrong. You might
not know who Tim Armstrong is, but he has affected
(00:21):
your life in ways you probably don't know. He's a
pioneer in the business realm of the Internet. He was
in the room at M I T when people showed
him up on the screen the Internet and he jumped
all over it. He's a serial entrepreneur, angel investor. He's
the former CEO of a O L and former president
(00:42):
of Google's America operations. He was part of the initial
Google team. It's totally totally crazy. We talked about a
lot of things, including how to not only welcome change,
but wield it as a weapon. We talked about how
expanding your network actually expands your network, and how to
stay open minded in business to create a culture of
(01:04):
free flowing ideas. This is awesome, Let's get into it.
Welcome to another episode. Today is a very very special
one because I'm sitting down with one of my favorite people.
(01:25):
He doesn't know that yet, but I'm going to tell him.
He is a mega, mega businessman and serial entrepreneur. Literally
the definition of an entrepreneur. Tim Armstrong, this man has
done it all. He is a leading entrepreneur, angel investor,
and former CEO of a o L, one of the
largest companies in the world. And not to mention, he
was the president of Google's America operations, he helped establish
(01:49):
Google's AdSense, and now he's the founder and CEO of
d t X, technology company focused on the direct to
consumer economy. I mean, talk about an entrepe preneur, and
he's easily one of the most knowledgeable and influential people
in the world. I am so excited to be sitting
down with him today. So without further ado, Tim Armstrong, Right,
(02:09):
good to see you, and uh, I'm a huge fan
of yours and UH always get a lot of energy
around you, so I'm really happy to be here. Yeah, man,
I I am pumped. Well That's why I have energy
when I'm around you, because I'm just super excited. You know,
you've lapped so many people over the years. I mean
just looking at your you know, your timeline from when
you graduated college in Connecticut to where you are today.
(02:33):
Did you know when you graduated college that you were
going to be an entrepreneur. Did you think, maybe I'll
just go get a regular job and get a white
picket fence for the rest of my life. Like, what
was that thought process like for you? Yeah, I'll tell you, Ryan,
And I think you and I have similar backgrounds to
some degree, which is uh. I started very early in
my um actually when I was about ten years old,
(02:55):
doing businesses, even before I got to high school, and
so I did a couple things that kind of got
me on that in that direction, and then kind of
naturally by doing some small, like little neighborhood entrepreneurial things
in high school, I started to read business biographies just
because I just enjoyed business so much, which I thought
I was going to go into investment banking, and that's
(03:16):
like kind of the path I went on. And I
was there for about three months, and the guy I
was sitting next to it the place I was was
so much better at the job than I was that
I went to my boss and I said, I said,
I'm gonna be leaving because I'm gonna go off and
do something entrepreneurial. But and the guy said, why are
you leaving? I said, well, the guy next to me
is a monster at what we do. He's amazing, So
I said, you should promote him or do whatever. But
(03:36):
I realized that if I had compete against this guy
the rest of my life, he should be the CEO
of this place. Sometime I'm gonna go off and do
something I'm good at. So I left and started a
newspaper and from there I've pretty much been doing that
type of stuff ever since. Were you always in tune
with your own strengths and weaknesses that way? Because that
takes complete balls. Most people wouldn't do that. They would say, ah,
(03:56):
but I'm gonna beat that guy, or they'd be angry
or they jealous. You you are humble enough at such
a young age to be to go and ask for
for his promotion and had quit to go start a
newspaper from an invested banking job. Are you crazy? Yeah,
I don't know. It's probably one of the things that has,
if anything that I've been successful at I think in
(04:17):
life has been because I don't know if my parents
brought me up with this kind of ethos, And then
I played a lot of sports and I had a
couple of teachers that have been impact on me, and
they constantly used to say to me, celebrate other people's
success and and don't. It's not a reflection on you,
it's a reflection on them. And the world's a big place.
You can be successful and other people can be successful.
So I have a personal mission statement I have that
(04:39):
I wrote seven years ago, but I think it encompasses
kind of my philosophy even back then, which is like
to this day, like nothing makes me happier than seeing
someone else kick and butt at what they do. And
it's one of the reasons when I when I met
you for the first time and I got to know
your background, I love people like you because, like, I'm
really energized and inspired by people who are successful and
(05:01):
people who take the risk and do all the things
you need to do. So, I don't know, I've never
had a gene where I'm like competitive with other people
in competitive with myself. I don't know, it's been that's
been actually I don't know if it's natural. It kind
of got talk to me, but it's actually been a
big advantage. You've got to be open to possibilities, right,
You've got to be open to the power of saying
yes and to also, I mean taking risks. So sitting
(05:22):
at a bank, like, what makes you think at that
time that media and digital journalism and advertising was the
future and was going to be your future and a
profitable future. When I was going to leave the bank,
I thought, I want to be successful, and I'm sure
there's a bunch of people that have already gone through
the gauntlets to be successful. So I'm like, I'm gonna
(05:42):
call all the CEOs in Boston. And so I started, like,
made a list of all the CEOs in Boston, in
the big places like Fidelity. There was a bunch of
big types of companies, and I started calling and of like,
of course I'd either get rejected at the front desk
or sometimes I get transferred to the assistant. One day
I called that the CEO of a big company, and
the assistant said to me, how are you? And I said,
(06:05):
you know, I'm twenty two. I just want to ask
the CEO of some questions about like career advice and stuff.
And she's like, look, the only people who get through
to him directly are journalists. So I hung up the phone,
picked the phone back up and I called and I said, Hey,
I'm Tim Armstrong. I'm from a new publisher on publication
that's coming out in Boston for young people, and we're
gonna want to do an interview with the CEO, and boom.
(06:26):
I got through and so basically I'm like and I
started thinking, like everyone my age probably has the same problem.
So I started a newspaper called Beginnings in Boston with
my best friend from high school. And all we did
was trying to interview people and give stories and road
maps in your young twenties, how do you become successful?
But it literally that's how I started. It was from
that one phone call. That's crazy and so funny because
(06:48):
that's now you starting that newspaper. That's people today starting vlogs.
I guess you could still start a newspaper, but it
probably makes more sense to do it online. Well, let
me tell you crazy story. So I start the newspaper.
I have no idea. What I'm doing is business boot camp.
One on one. We my roommate and I. I learned
how to program because we had a program the interface.
We but I sold my car about a quadr six
(07:08):
fifty computer Apple computer. We learned how to publish, put
the put the newspapers out. We haven't distributed all over
Cambridge and Boston. And a friend of mine calls me
and says, the name is Peter Dunn. He said, Hey,
there's these guys down to M I. T. Who said
they can publish something like a newspaper immediately without paper
on a computer. So I'm like, all right. So I
(07:29):
went down to M I T. And the guys from
University of Illinois who had the first browser with there.
They turned it on, they loaded a website and I said,
wait a minute, did you just put information that you
input a someplace else through you know, through this network
and up on the computer screen and like that's all
that happened. And somebody had to input electronically, and they're
like yep. I literally got up, left meeting, went back
(07:51):
to my office, told my best round phone high school,
and I was selling the newspaper and we're doing this
thing called the internet. I'm like, I don't know what
it is, but it's a thousand times cheaper and faster
than what we're doing in the newspaper, and we're gonna
put the newspaper online. That's how I got introduced to
the Internet, and that's changed the rest of my life.
That that one meeting in m I t that is crazy.
What did you learn? You know that's stuck with you.
(08:11):
From building the newspaper, as you said, business one oh one,
to building companies, which you did later on, you have
to understand your business at a core level. And I
think that's something else that people don't appreciate is when
you're younger in your career and you look for it,
you think that all the people went up to career,
they just got bigger and made bigger decisions and things
like that. But many of the people that I met
(08:33):
during that early part in Boston, some of the CEOs
and some of the other people in networking with, I
noticed that they were all super knowledgeable about the details
of their business. And I took that when we've built
the newspaper, like I knew how to do everything at
the newspaper. And I think that's another powerful attribute, is
like knowing being the world's expert at what you do,
(08:56):
and you I know you are for what you do
ryan and like, and you write books about it and
you talk about it and you meet with people, and
that if you don't have that you're gonna lose to
other people in your business. If you don't want to
become the world expert, guess what someone else is. So
that that's one takeaway. The second takeaway is just change.
Change is a there's a weapon. It's either pointed at
(09:17):
you or you're holding it. When I didn't know what
I was doing, I was able to learn and change,
learn change, learn change, and then that formula gave me
risk taking. I learned how to take risks, and so
I always think back to that, which is like, if
I'm not changing and evolving, I'm probably losing. It's about
being part of the running river instead of a still pond.
The still pond smells, it's weird, still a body of water,
(09:40):
but you know, you might not want to go swimming
in it. The running river is clean, there's fish, there's life,
there's things happening, and there's amazing, amazing opportunities around every bend,
even if you don't know it. So you sold the
newspaper and then you got involved and started working at
a company called star Wave. What was star Wave? I
got invited to go to a nast horror event with
(10:00):
the owners in NASCAR, The France family so that I
went to this big meeting and I was sitting in
the back of the room. How do you meet all
these p I'll ask you that later. Basically, I went
to this meeting. The Francis gave this whole president on
the NASCAR and at the end they said, oh, by
the way, we're gonna launch a website. And so in
the back of the room, I was like, you know, oh, hell, yes,
(10:20):
you know. Now you're talking my language. So after the meeting,
I went up to them and said, hey, um, Tim Armstrong,
you don't know me, but that last thing you talked about,
I'm super excited about it and building this company in
Boston that's been doing internet stuff. So anyways, uh, the
Ryan Frant said to me, Hey, there's this company, star
Wave in Seattle that's growing. Paul Allen started its growing quickly.
(10:45):
They're doing internet content for how excited you are you
should think about you know, star Waves. So I went
back to my apartment in Boston and I had a
message from the recruiter at star Wave because they had
been calling around the United States trying to find people
who were doing internet stuff and was so small at
that point that they had called somebody that I knew,
and they said, hey, this this kid and I at
(11:08):
the same time had sent my application, and so I
said the woman, I said, you know, I can believe this.
I just sent an application. It was a third party
recruiter to star Wave and she said, well, your name
came up because we were asking around of people who
are doing Internet stuff. So advance short, Bluda Seattle got
a job offer the day I went there. UM told
him yes on the spot, moved out like I don't know,
(11:28):
maybe two months, no, no, two weeks later or something
with a bag of closed didn't know anybody, and started
at Starwave. And Starwave was did launch ESPN dot com,
NFL dot com, Nascar dot com, a Snews dot com.
And it was like the beginning of the Internet. All
these smart people from engineers and content people and media
people from all over the US showed up here to
(11:49):
work for Paul Allen and this guy Mike Slaves, Bill
Gates's best friend, and Tom Phillip, the guy who started
Spy magazine and was I worked with met Google also.
So anyways, long seriy short. It was an amazing environment,
my first environment on the West Coast. I grew up
in a small blue collar town. I didn't travel much,
but I learned it was like West Coast, high energy technology,
(12:13):
smart people. And also I was really creative growing up,
and where I grew up was not like a hyper
creative environment. And this was the first place I got
dropped where I was like, God, I'm home. This is
like all creative people walk us through. How you met
Sarah gay Brand and Larry Page and and landed at Google.
(12:36):
That meeting alone is something that millions and millions to
people could only dream of, and you actually got to
do it and you got to work with them. How
did that all happen? There's another super important lesson. As
I always say, the most important decisions of your career
happen when you're not in the room. At star Wave,
I had the opportunity to do a couple mega deals,
(12:57):
bigger than any other deals the company had ever done.
I got a very good reputation as someone who was
like highly creative, knew the space well, and could do
mega deals. So Um, one of the women that I
worked with, Um, who was a peer of mine, went
to go be a recruiter after we all we all
left Starwave, and I did a couple of things after
Starwave before Google. Again, this came back around as a
(13:20):
super helpful thing. She mentioned to the Google people, Um, hey,
there's this guy. He's in New York. So Omid Cortis Donni,
who's now the chairman of Twitter, came to New York.
He was at Google. He was really the first business
employee at Google. Another's the crazy thing. It was like
a Friday afternoon, pouring rain. I was downtown that this
woman called me. She said, you got to meet this guy.
(13:41):
There's this company Google. I said, oh, I've been using
Google because I was stabbing on the Space. So I
love that company. And I had another job offer at
the time to go be the president of one of
the gaming companies. And I said to us, so, I
have this other job thing I'm working on. And she said,
you know, Tim, She's like, I know you just take
the eating. So I said, all right, yeah. So I
hustled uptown, went to the Regency Hotel met Ohmed, who
(14:04):
I didn't know, who's now one of my one of
my really close friends. I sat down with him. We
had a great conversation and he said, look, I don't
know what's going to happen at Google. I don't know
if we're gonna be a you know, big and advertising.
I know you're like a big guy, you know, blah
blah blah blah. You know, come out and meet Larry
and Sergey. So what was the Omed's role at that
time at Google? He was basically the chief business officer
(14:26):
of Google. Um So Google was like I don't even remember.
It was probably like fifty people at that point or something,
or maybe seventy. It was all. It was basically all engineers,
and then O Mead and another woman, Joan brad Eye,
and a guy named Wiskowski, and there was there was
like three or four business people, all engineers, and it
was the search licensing business, and they were gonna start.
(14:48):
They just started to think about getting an ads. There's
another guy, Davidkacko. So anyways, long story short is I
fly out and have breakfast with Sergey and Omed. And
Sergey comes to breakfast and he's like, hey Tim, He's like,
you know, just you know, we had a little chit chat.
Then he's like, I don't know what questions to ask you.
(15:09):
You interview yourself, ask yourself the questions you think I
should ask you. So I was like, all right, So
I'm like, I asked all the tough questions. I'm like,
I'm I'm not gonna help pull any punch. I'm gonna
ask what I think you know chess? So I I
you know, he would interject some questions, will me to
ask some questions, but in general, I would say the
main part of the interview was me coming up with
(15:32):
the questions and explaining why I was asking the question.
He made you have a conversation with yourself. Yeah. But
by the way, this is one of the things that
Larry and Sergey absolutely brilliant at is he was getting
a much fuller picture of me, which is, how do
you think, how do you handle that situation? What questions
do you come up with? Why did you come up
with the questions? And it was you know, and then
(15:54):
I can tell you a million stories about how they
did stuff like that at Google, but but they were
incredibly billy and that that stuff. And I'll tell you this.
I had another job offer that was I forget the number.
It was probably twice the amount of money. It was
a massive benefits package. I think it had a card,
had like a house payments for a year. It was
(16:14):
like an unbelievable offer. Google was way smaller, way riskier,
all those other things. And I was just in the
process of getting married. So I was engaged and about
to get married. So I came back and I said
to my wife, who was my wife, Nancy Now, I said,
and there's another lesson in this, which is one of
the biggest decisions you make in your life is who
(16:35):
you partner with. They have a huge imprint on you
and what you think and and those things. So I
said to my now wife than than fiance, Nancy, I'm
trying to make a decision between these two things. She said,
what do you think. I said, Well, this is that
there's all this money and all this other opportunity and
like gaming is gonna be big and all this other stuff,
and you know, but you know, Google, I I just like,
I don't know, I'm like more passionate about it, but
(16:57):
it's like a way not as good as an offer
or you know, blah blah blah. So she she said, Tim,
I'm gonna give you one piece of advice. She said,
I've been watching your eyes while you're talking about the
two companies for the last month or so. Go to Google.
You'd be going this other place for the wrong reasons.
And I you're a passionate guy. Your energy level when
you're talking about Google is ten x. What is the
(17:19):
other thing? And she's like, we'll figure it out. We
don't we by the way, we had no money. We
were living on one bedroom apartment Eightio six and Columbus,
And she said, whatever, we'll figure it out. You know,
don't worry about it. So anyway, so that's how it
went down. What was it like being on the Google
train in those nine years, because that's when it went
from Google to Google. It was like the world's most
(17:40):
intense science project. First years there, it was unmitigated mess
like a messy science project where we were testing everything
and and like you know, when they hired me, by
the way, there's a funny story. So when they hired
me that they gave me like a one page sheet
that said we're hiring you this, here's just salary, here's
your act. And by the way, if it doesn't work out,
(18:02):
no harm, no foul. The reason I was able to
go to a o L was I didn't have a
noncompete because Google didn't know whether or not they were
going to be big in the ad business. So they didn't.
I had this like sheet of paper that said, you know,
if it doesn't work out well, just part ways, no harm,
no foul. So anyway, as long astorry short as the
first order I got, I said, I have an order
coming in for advertising, you know, and um, Larry and Sergey,
(18:25):
I said, I need to get a fax machine because
I can't get the order. Just said that we're clear.
They made you head of head of US right ahead
of US sales sales. And I was in New York.
I was in California. So my harmon in New York
was the first office outside of Mountain Views. So I
get the first order. I called them. I say, guys,
I gotta I got an order. And I'm like, I
gotta buy a fax machine. And the fax machine was
like I don't know how much it was. It was
like a bucks. I'm like, I gotta buy this fax machine.
(18:48):
They're like, prove that you have the order. What They're like, yeah,
proved that you have the order. I'm like, guys, I
can't get the order. Let's have the fax machine. They're like,
we don't want to spend the money on the fax
machine unless you have the order. And I'm like, so
we had about another lesson Larry and Sergey, we're cheap
(19:09):
and they were. When you go to Google's profitability, while
Google is so profitable, it's because they were super super
good with expenses and where money was that they'd rather
spend money on tech than spending on a fax machine.
And by the way, I totally get that and respect that,
but that story is the story. Like that's like having
an order and fighting over spending a hundred twenty dollars
(19:31):
on a fax machine. That's that's a true story. One
thing Google did that other people did not do in
people in media business today still don't do this, which
amazes me. This is Google's secret. Every single week, we
used to look at the high performing customers and low
performing customers, and if you were below a two percent
click through rate in our ad program, even early on,
(19:51):
we kick you out of the program. So you let
clients go and you let money go. Yes, And because
we wanted the highest quality stuff for our end users.
And what it did was it trained our algorithms and
what good ads were. So if you think about today,
Google has pretty much mopped up the entire ad business,
and Facebook has and those those type of companies. And
(20:12):
one of the secret sauces to that is they put
in a quality algorithm. Forever you can see how many
bad ads you get as a human everywhere you go.
They put in one quality algorithm that changed the entire game.
And by the way, if you're a customer and I
call you and say, hey, Ryan, you can't run your
ads unless they're high quality, I'm gonna kick you off.
What do you do to your ads? You make them
(20:32):
higher quality, make them high quality if it has a
network effect, right, So, and customers used to complain about
it all the time, but we ran it and did it.
And you know that's a lot of the foresight that
that that you know, Larryon's had and the team had,
and you know, we did tons of testing. It was
a lot of fun. My world was Monday through Thursday, California, Friday, Saturday, Sunday,
(20:53):
New York. So I was living in this bicoastal every week,
you know, life. And I saw the difference between how
New York City was doing business and how Silicon Valley
was doing business every week and I could see I said, Wow,
these guys are We're going to mop up the whole universe,
you know, just that openness, the openness, the learning, the science,
you know. And my friends in New York where you know,
(21:13):
they were all in different industries, but a lot of
New York was like, Hey, I'm gonna beat your head
in and I'm the best at this and it's my
way or the highway. And California was like, hey, you
have a good idea, come on in this room. You know,
it doesn't matter what your what your hierarchy is here
you have a great idea. You speak, you know, and
it was like over and over and over and over again,
big difference in culture. And then walk me to you
(21:38):
know that role where you basically, you know, you were
an entrepreneur. You had the newspaper and then you started
working for other people as you you know, created your
net worth through your network and you kept building a
building building, And then Patch Media came around. I did
associated content with my roommate from college under rug you
end up running it as the biggest investor in it,
and then we I did Patch and social content ends
(22:01):
along story end up selling the Yahoo. It was a
very good financial transaction SOLDI Yahoo and Patch. One of
my theories was local news was going to get destroyed
newspapers because they weren't transitioning fast enough. Local news is
the most important, one of the most important things in
the United States has as a as a country. So
I started Patch with John broad another another another really
(22:22):
close friend of mine and somebody I worked with before.
And John and I tested in three towns and then
we started scaling it up. And then our goal was
to basically put digital news site in every town in America.
So we eventually got up to the point we're in
three thousand towns um in America. And and I had
(22:43):
taken then a o L job time Warner had bought Patch.
Patch was part of the thing I was doing at
AOL at that point. I unfortunately I an activist investors
actually now a friend of mine attacked us at a
o L and I had to sell Patch because they
thought we were spending too much money on it. But
to still it's profitable and growing, and the people who
(23:03):
own it now are Charles Tayle and Hail Company. They
great people, done a great job of it. And I
still think local news is one of the bigest white
spaces for business in the in the US. That's so
cool that it's still there. What did it mean to
you to, you know, have that interview with those guys.
You're interviewing yourself, and then you get to a point
in your life where that one negotiating item allows you
(23:27):
to cash out for for that amount of money, where
you could take five million of it and put it
into this new company that you are now completely in
control of, like it's it's a huge company that everyone
knows around the world. I mean, what was your mindset
like at that time, because most people would say, I'm
out take me to the island, and you said, no,
I'm gonna go run AOL and I'm gonna rebrand it,
rebuild it. I'm gonna help him out. And then and
(23:49):
then you obviously didn't stop there. I haven't saying learn
to earn. And when the A O L opportunity came up,
I met with Jeff Bucaus, who was the ceof Time Warner.
You called and said, hey, can we have a meeting.
I thought it was about the Google Time Warner partnership
is all another story could a huge deal with with
those guys. But over there he said, hey, we got
to spend a while out of Time Warner. Would you
be interested in being CEO, and so I um left
(24:12):
the meeting. I called my wife, called a couple of friends,
and you know, one of my friends said to me, Tim,
you went from a company that was almost zero at
Google that went to a hundred and fifty billion market cap.
And you before that were at Starway that got bought.
Before that, you were with Rick Scott who was it
was the governor of Florida and then senator by the
time Perdeers that the CEO of Columbia h c A.
(24:33):
We bought a company, sold the News Corps. So I've
done a bunch of other things. So he said to me,
you know, the only thing you don't have your resume
is like, why don't you do a turnaround? And so
I thought, you know what learned to earn. I'll figure
this out. You know, I don't know how I'm going
to figure it out, but I'll do it. So I
made a fairly fast decision, actually did it. I told
him Meat and Larry and Sergey, which was pretty painful,
(24:54):
and ersh Smith and then Um and then went to
do it. And then what I did is I went
back to zero. They sorry, did they did? They make
you give yourself an exit interview. Now they I was
in a room with them for two and a half hours,
and they pretty much told me how stupid the decision
was and why I was going to regret it, and
you know, blah blah blah blah blah blah blah blah.
(25:15):
And so I sat there for two and a half hours.
I didn't feel it very good by the time I left,
but I just said, I just said, I just know myself.
I've been here for almost ten years, and you know
I don't have to grow. So so I I left
one thing. I did a well, which I took advice.
I called a bunch of other CEOs, big big ceosum
just to ask for their advice, and a couple of
them told me, you know, to me, got a it's
(25:37):
a different job being in the number two chair, number
three chair or whatever like, it's just different. I was.
I decided myself, I just did it again. About three
years ago, two years ago, want the left horizon. I
went to zero. I said, I know nothing. I'm gonna
start from scratch. So I read every single book I
could be about a CEO. I went to see Howard Schultz.
(25:57):
Ken Channel Jack Welch has called these people and said, hey,
can I come pick your brain about how you're the CEO? Yes?
What's the job? What is it? What do you do?
You know all these other things. I'll tell you some
stories like So I went out to see Howard Schultz.
Look to see Howard Schultz. I had a whole strategy
plan with me. I've done all this work at a
well already like boom, you know, when out there, expected
to show him the strategy and give me feedback. So
(26:19):
he's about the deck, I said, Howard, I knew him
a little bit. I said, you know, I got this deck.
I want to show you the strategy. He said, put
the deck away. He said, where's your people plan? And
I said what? He said? Where's your people plan? He said,
being a CEO is about people. And he said the
two things you need is a people's strategy and you
(26:39):
need an awesome head of HR. Then we'll talk business strategy,
but I want to talk to you about people first.
And I would say that was the most impactful conversation,
you know, and general the other ones were super impactful too,
but I'll just that's just one quick story, and it
really helped me. Reset really really helped me reset, and
so I kind of tried to cheat as much as
I could. I tried to steal everybody else's knowledge and
(27:00):
start with that. And you know, I made a boatload
of mistakes and I we we had a boatload of
success also. But I I credit a lot of the
help I got from those other people for why we
made it through some of those situations. I have a
lot of advice on that topic about mentors and stuff
like that, but that they were so helpful and so
(27:20):
gracious with their time and energy. And then he became
the CEO of another company. Yes, so I started a
company g t X, And that's a company we're doing
now tell me, tell me about it and what it
is and why you started it. Yeah, So I started
because I think the structure the internet's broken. I think
there's too much value in the middle of the marketplace.
I think the really big companies. I think there's been
(27:42):
more more ability for brands and people to go direct
to consumer. I think that like it's really important to
have an ecosystem. So I'm much more into moving value
to the edges of the marketplace, back to consumers and
back to businesses. So the business we built is essentially
a direct to consumer company that connects offline to online
(28:02):
and gives people control over their information and data, both
on the consumer side and on the brand side. I
just think for someone like you, for instance, I'll tell
you one thing. There's one thing people don't realize about
the Internet. Most of the brands on the Internet and
a lot of the influencers on the Internet rent their
own customers. And what I mean by that, I've had
this conversation with a lot of people is they're like, no,
(28:23):
that's not true. I have a million Instagram followers or
twenty million Twitter followers, and I say, yeah, but what's
their address? How do you directly communicate with them? I
do it over those platforms. Like yeah, but the platforms
own those customers and you're renting them. I want more
people to own their own customers. Do you think learning
that and allowing people to to own their customers? Is
(28:47):
that what you're bullish on right now? As you think
about the next ten years, because before we know it's
gonna we're going to look back, you know at ones
is this wild time a decade ago? Yeah? I think,
by the way, here's the deal for for your business
in particular, you know, you have your film and acting background,
you have the real estate background, you have the entrepreneurial background.
(29:09):
You're someone who deserves to have a direct relationship with
all of your customers. The reason is not just for
your business, but because you're somebody who adds value outside
of your business and you have other interests. I think
it's your your and principle. A lot of people in
life will benefit by having a direct relationship with you
(29:31):
because you bring the and principle. You might help them
doing your core stuff in real estate, but you might
also help them in something else you know that you're
interested are doing. And that's like, that's the network effect,
and you're not going to have a network effect if
your own relationship through everybody is instagram one way relationship.
You as a great there's a great tool and a
great platform, but hey, why not have relationships with everybody
(29:52):
and know who they are and know where they live,
you know what they want, you know, serve them more things.
One of the last questions I have for you, and
I reached out to you and asked you to do this,
and I told you the title of the podcast is
big Money Energy. Without knowing anything about it, what did
you think, well, I'm just gonna tell you something. Honestly.
One of the other skill sets I have, which I
think it was kind of maybe as the quality that
was born with, is when I meet people, I sometimes
(30:18):
get like a sensation that I know that they're going
to be super successful. So the minute I met you,
and I can name a whole bunch of other super
successful people I've met, even when they weren't successful yet,
that I was like, this guy is going to be successful.
And again going back to the stage point, I'm on
your team. Anything you want me to do to help you,
(30:38):
I'm gonna do only because I know you have the
draw from talking to you for you know, a minute
and a half, I was like, this guy knows the
formula a lot, and he's working the formula and in
a good way for for humans and sharing his knowledge.
So when you asked me to do anything, I said,
of course. And I and I think that the energy
(30:59):
piece is important. You know, Jack Welch said something and
I think it's in one of his books. You know,
he he had a way to assess people. In the
first two assessment of these things, the four ease and
a p um and a couple of other things, but
two of the first four ease were energy number one
of yourself and two is to be able to bring
out energy and other people. And you have that. So
when you asked me to do this, I figured it
(31:20):
would probably help build the stage, maybe maybe for you.
I don't think you are. You already got your own stage,
but you know, maybe somebody else gets helped um So
that that's what it is, and I think you have
that the first two years. You've got all his principles,
but you the first two eads are like your titles,
speaks right through that. This has been great. Thank you
so much, and have a great rest of your day.
All right, all right, seem if you're ready to take
(31:44):
action today. Based on Tim Armstrong's entire blueprint for how
he got to where he is, go to Big Money
Energy dot com slash podcast to download an action plan
I put together for you, as well as the show notes.
That's Big Money Energy dot com slash podcast. Find more
podcasts like Big Money Energy on the I Heart Radio
(32:06):
app or wherever you get your podcast. Big Money Energy
is hosted by me Ryan Sirhand. It's produced by Mike
Coscarelli and Joe Loreesca and executive produced by Lindsay Hoffman.
Welcome back to a brand new episode of Big Money Energy,
where we talk to super successful and self made people
to find out exactly how they did, how they went
from nothing to something. I'm Ryan Sarhand and today I
am pumped because I'm talking to Tim Armstrong. You might
not know who Tim Armstrong is, but he has affected
(00:21):
your life in ways you probably don't know. He's a
pioneer in the business realm of the Internet. He was
in the room at M I T when people showed
him up on the screen the Internet and he jumped
all over it. He's a serial entrepreneur, angel investor. He's
the former CEO of a O L and former president
(00:42):
of Google's America operations. He was part of the initial
Google team. It's totally totally crazy. We talked about a
lot of things, including how to not only welcome change,
but wield it as a weapon. We talked about how
expanding your network actually expands your network, and how to
stay open minded in business to create a culture of
(01:04):
free flowing ideas. This is awesome, Let's get into it.
Welcome to another episode. Today is a very very special
one because I'm sitting down with one of my favorite people.
(01:25):
He doesn't know that yet, but I'm going to tell him.
He is a mega, mega businessman and serial entrepreneur. Literally
the definition of an entrepreneur. Tim Armstrong, this man has
done it all. He is a leading entrepreneur, angel investor,
and former CEO of a o L, one of the
largest companies in the world. And not to mention, he
was the president of Google's America operations, he helped establish
(01:49):
Google's AdSense, and now he's the founder and CEO of
d t X, technology company focused on the direct to
consumer economy. I mean, talk about an entrepe preneur, and
he's easily one of the most knowledgeable and influential people
in the world. I am so excited to be sitting
down with him today. So without further ado, Tim Armstrong, Right,
(02:09):
good to see you, and uh, I'm a huge fan
of yours and UH always get a lot of energy
around you, so I'm really happy to be here. Yeah, man,
I I am pumped. Well That's why I have energy
when I'm around you, because I'm just super excited. You know,
you've lapped so many people over the years. I mean
just looking at your you know, your timeline from when
you graduated college in Connecticut to where you are today.
(02:33):
Did you know when you graduated college that you were
going to be an entrepreneur. Did you think, maybe I'll
just go get a regular job and get a white
picket fence for the rest of my life. Like, what
was that thought process like for you? Yeah, I'll tell you, Ryan,
And I think you and I have similar backgrounds to
some degree, which is uh. I started very early in
my um actually when I was about ten years old,
(02:55):
doing businesses, even before I got to high school, and
so I did a couple things that kind of got
me on that in that direction, and then kind of
naturally by doing some small, like little neighborhood entrepreneurial things
in high school, I started to read business biographies just
because I just enjoyed business so much, which I thought
I was going to go into investment banking, and that's
(03:16):
like kind of the path I went on. And I
was there for about three months, and the guy I
was sitting next to it the place I was was
so much better at the job than I was that
I went to my boss and I said, I said,
I'm gonna be leaving because I'm gonna go off and
do something entrepreneurial. But and the guy said, why are
you leaving? I said, well, the guy next to me
is a monster at what we do. He's amazing, So
I said, you should promote him or do whatever. But
(03:36):
I realized that if I had compete against this guy
the rest of my life, he should be the CEO
of this place. Sometime I'm gonna go off and do
something I'm good at. So I left and started a
newspaper and from there I've pretty much been doing that
type of stuff ever since. Were you always in tune
with your own strengths and weaknesses that way? Because that
takes complete balls. Most people wouldn't do that. They would say, ah,
(03:56):
but I'm gonna beat that guy, or they'd be angry
or they jealous. You you are humble enough at such
a young age to be to go and ask for
for his promotion and had quit to go start a
newspaper from an invested banking job. Are you crazy? Yeah,
I don't know. It's probably one of the things that has,
if anything that I've been successful at I think in
(04:17):
life has been because I don't know if my parents
brought me up with this kind of ethos, And then
I played a lot of sports and I had a
couple of teachers that have been impact on me, and
they constantly used to say to me, celebrate other people's
success and and don't. It's not a reflection on you,
it's a reflection on them. And the world's a big place.
You can be successful and other people can be successful.
So I have a personal mission statement I have that
(04:39):
I wrote seven years ago, but I think it encompasses
kind of my philosophy even back then, which is like
to this day, like nothing makes me happier than seeing
someone else kick and butt at what they do. And
it's one of the reasons when I when I met
you for the first time and I got to know
your background, I love people like you because, like, I'm
really energized and inspired by people who are successful and
(05:01):
people who take the risk and do all the things
you need to do. So, I don't know, I've never
had a gene where I'm like competitive with other people
in competitive with myself. I don't know, it's been that's
been actually I don't know if it's natural. It kind
of got talk to me, but it's actually been a
big advantage. You've got to be open to possibilities, right,
You've got to be open to the power of saying
yes and to also, I mean taking risks. So sitting
(05:22):
at a bank, like, what makes you think at that
time that media and digital journalism and advertising was the
future and was going to be your future and a
profitable future. When I was going to leave the bank,
I thought, I want to be successful, and I'm sure
there's a bunch of people that have already gone through
the gauntlets to be successful. So I'm like, I'm gonna
(05:42):
call all the CEOs in Boston. And so I started, like,
made a list of all the CEOs in Boston, in
the big places like Fidelity. There was a bunch of
big types of companies, and I started calling and of like,
of course I'd either get rejected at the front desk
or sometimes I get transferred to the assistant. One day
I called that the CEO of a big company, and
the assistant said to me, how are you? And I said,
(06:05):
you know, I'm twenty two. I just want to ask
the CEO of some questions about like career advice and stuff.
And she's like, look, the only people who get through
to him directly are journalists. So I hung up the phone,
picked the phone back up and I called and I said, Hey,
I'm Tim Armstrong. I'm from a new publisher on publication
that's coming out in Boston for young people, and we're
gonna want to do an interview with the CEO, and boom.
(06:26):
I got through and so basically I'm like and I
started thinking, like everyone my age probably has the same problem.
So I started a newspaper called Beginnings in Boston with
my best friend from high school. And all we did
was trying to interview people and give stories and road
maps in your young twenties, how do you become successful?
But it literally that's how I started. It was from
that one phone call. That's crazy and so funny because
(06:48):
that's now you starting that newspaper. That's people today starting vlogs.
I guess you could still start a newspaper, but it
probably makes more sense to do it online. Well, let
me tell you crazy story. So I start the newspaper.
I have no idea. What I'm doing is business boot camp.
One on one. We my roommate and I. I learned
how to program because we had a program the interface.
We but I sold my car about a quadr six
(07:08):
fifty computer Apple computer. We learned how to publish, put
the put the newspapers out. We haven't distributed all over
Cambridge and Boston. And a friend of mine calls me
and says, the name is Peter Dunn. He said, Hey,
there's these guys down to M I. T. Who said
they can publish something like a newspaper immediately without paper
on a computer. So I'm like, all right. So I
(07:29):
went down to M I T. And the guys from
University of Illinois who had the first browser with there.
They turned it on, they loaded a website and I said,
wait a minute, did you just put information that you
input a someplace else through you know, through this network
and up on the computer screen and like that's all
that happened. And somebody had to input electronically, and they're
like yep. I literally got up, left meeting, went back
(07:51):
to my office, told my best round phone high school,
and I was selling the newspaper and we're doing this
thing called the internet. I'm like, I don't know what
it is, but it's a thousand times cheaper and faster
than what we're doing in the newspaper, and we're gonna
put the newspaper online. That's how I got introduced to
the Internet, and that's changed the rest of my life.
That that one meeting in m I t that is crazy.
What did you learn? You know that's stuck with you.
(08:11):
From building the newspaper, as you said, business one oh one,
to building companies, which you did later on, you have
to understand your business at a core level. And I
think that's something else that people don't appreciate is when
you're younger in your career and you look for it,
you think that all the people went up to career,
they just got bigger and made bigger decisions and things
like that. But many of the people that I met
(08:33):
during that early part in Boston, some of the CEOs
and some of the other people in networking with, I
noticed that they were all super knowledgeable about the details
of their business. And I took that when we've built
the newspaper, like I knew how to do everything at
the newspaper. And I think that's another powerful attribute, is
like knowing being the world's expert at what you do,
(08:56):
and you I know you are for what you do
ryan and like, and you write books about it and
you talk about it and you meet with people, and
that if you don't have that you're gonna lose to
other people in your business. If you don't want to
become the world expert, guess what someone else is. So
that that's one takeaway. The second takeaway is just change.
Change is a there's a weapon. It's either pointed at
(09:17):
you or you're holding it. When I didn't know what
I was doing, I was able to learn and change,
learn change, learn change, and then that formula gave me
risk taking. I learned how to take risks, and so
I always think back to that, which is like, if
I'm not changing and evolving, I'm probably losing. It's about
being part of the running river instead of a still pond.
The still pond smells, it's weird, still a body of water,
(09:40):
but you know, you might not want to go swimming
in it. The running river is clean, there's fish, there's life,
there's things happening, and there's amazing, amazing opportunities around every bend,
even if you don't know it. So you sold the
newspaper and then you got involved and started working at
a company called star Wave. What was star Wave? I
got invited to go to a nast horror event with
(10:00):
the owners in NASCAR, The France family so that I
went to this big meeting and I was sitting in
the back of the room. How do you meet all
these p I'll ask you that later. Basically, I went
to this meeting. The Francis gave this whole president on
the NASCAR and at the end they said, oh, by
the way, we're gonna launch a website. And so in
the back of the room, I was like, you know, oh, hell, yes,
(10:20):
you know. Now you're talking my language. So after the meeting,
I went up to them and said, hey, um, Tim Armstrong,
you don't know me, but that last thing you talked about,
I'm super excited about it and building this company in
Boston that's been doing internet stuff. So anyways, uh, the
Ryan Frant said to me, Hey, there's this company, star
Wave in Seattle that's growing. Paul Allen started its growing quickly.
(10:45):
They're doing internet content for how excited you are you
should think about you know, star Waves. So I went
back to my apartment in Boston and I had a
message from the recruiter at star Wave because they had
been calling around the United States trying to find people
who were doing internet stuff and was so small at
that point that they had called somebody that I knew,
and they said, hey, this this kid and I at
(11:08):
the same time had sent my application, and so I
said the woman, I said, you know, I can believe this.
I just sent an application. It was a third party
recruiter to star Wave and she said, well, your name
came up because we were asking around of people who
are doing Internet stuff. So advance short, Bluda Seattle got
a job offer the day I went there. UM told
him yes on the spot, moved out like I don't know,
(11:28):
maybe two months, no, no, two weeks later or something
with a bag of closed didn't know anybody, and started
at Starwave. And Starwave was did launch ESPN dot com,
NFL dot com, Nascar dot com, a Snews dot com.
And it was like the beginning of the Internet. All
these smart people from engineers and content people and media
people from all over the US showed up here to
(11:49):
work for Paul Allen and this guy Mike Slaves, Bill
Gates's best friend, and Tom Phillip, the guy who started
Spy magazine and was I worked with met Google also.
So anyways, long seriy short. It was an amazing environment,
my first environment on the West Coast. I grew up
in a small blue collar town. I didn't travel much,
but I learned it was like West Coast, high energy technology,
(12:13):
smart people. And also I was really creative growing up,
and where I grew up was not like a hyper
creative environment. And this was the first place I got
dropped where I was like, God, I'm home. This is
like all creative people walk us through. How you met
Sarah gay Brand and Larry Page and and landed at Google.
(12:36):
That meeting alone is something that millions and millions to
people could only dream of, and you actually got to
do it and you got to work with them. How
did that all happen? There's another super important lesson. As
I always say, the most important decisions of your career
happen when you're not in the room. At star Wave,
I had the opportunity to do a couple mega deals,
(12:57):
bigger than any other deals the company had ever done.
I got a very good reputation as someone who was
like highly creative, knew the space well, and could do
mega deals. So Um, one of the women that I
worked with, Um, who was a peer of mine, went
to go be a recruiter after we all we all
left Starwave, and I did a couple of things after
Starwave before Google. Again, this came back around as a
(13:20):
super helpful thing. She mentioned to the Google people, Um, hey,
there's this guy. He's in New York. So Omid Cortis Donni,
who's now the chairman of Twitter, came to New York.
He was at Google. He was really the first business
employee at Google. Another's the crazy thing. It was like
a Friday afternoon, pouring rain. I was downtown that this
woman called me. She said, you got to meet this guy.
(13:41):
There's this company Google. I said, oh, I've been using
Google because I was stabbing on the Space. So I
love that company. And I had another job offer at
the time to go be the president of one of
the gaming companies. And I said to us, so, I
have this other job thing I'm working on. And she said,
you know, Tim, She's like, I know you just take
the eating. So I said, all right, yeah. So I
hustled uptown, went to the Regency Hotel met Ohmed, who
(14:04):
I didn't know, who's now one of my one of
my really close friends. I sat down with him. We
had a great conversation and he said, look, I don't
know what's going to happen at Google. I don't know
if we're gonna be a you know, big and advertising.
I know you're like a big guy, you know, blah
blah blah blah. You know, come out and meet Larry
and Sergey. So what was the Omed's role at that
time at Google? He was basically the chief business officer
(14:26):
of Google. Um So Google was like I don't even remember.
It was probably like fifty people at that point or something,
or maybe seventy. It was all. It was basically all engineers,
and then O Mead and another woman, Joan brad Eye,
and a guy named Wiskowski, and there was there was
like three or four business people, all engineers, and it
was the search licensing business, and they were gonna start.
(14:48):
They just started to think about getting an ads. There's
another guy, Davidkacko. So anyways, long story short is I
fly out and have breakfast with Sergey and Omed. And
Sergey comes to breakfast and he's like, hey Tim, He's like,
you know, just you know, we had a little chit chat.
Then he's like, I don't know what questions to ask you.
(15:09):
You interview yourself, ask yourself the questions you think I
should ask you. So I was like, all right, So
I'm like, I asked all the tough questions. I'm like,
I'm I'm not gonna help pull any punch. I'm gonna
ask what I think you know chess? So I I
you know, he would interject some questions, will me to
ask some questions, but in general, I would say the
main part of the interview was me coming up with
(15:32):
the questions and explaining why I was asking the question.
He made you have a conversation with yourself. Yeah. But
by the way, this is one of the things that
Larry and Sergey absolutely brilliant at is he was getting
a much fuller picture of me, which is, how do
you think, how do you handle that situation? What questions
do you come up with? Why did you come up
with the questions? And it was you know, and then
(15:54):
I can tell you a million stories about how they
did stuff like that at Google, but but they were
incredibly billy and that that stuff. And I'll tell you this.
I had another job offer that was I forget the number.
It was probably twice the amount of money. It was
a massive benefits package. I think it had a card,
had like a house payments for a year. It was
(16:14):
like an unbelievable offer. Google was way smaller, way riskier,
all those other things. And I was just in the
process of getting married. So I was engaged and about
to get married. So I came back and I said
to my wife, who was my wife, Nancy Now, I said,
and there's another lesson in this, which is one of
the biggest decisions you make in your life is who
(16:35):
you partner with. They have a huge imprint on you
and what you think and and those things. So I
said to my now wife than than fiance, Nancy, I'm
trying to make a decision between these two things. She said,
what do you think. I said, Well, this is that
there's all this money and all this other opportunity and
like gaming is gonna be big and all this other stuff,
and you know, but you know, Google, I I just like,
I don't know, I'm like more passionate about it, but
(16:57):
it's like a way not as good as an offer
or you know, blah blah blah. So she she said, Tim,
I'm gonna give you one piece of advice. She said,
I've been watching your eyes while you're talking about the
two companies for the last month or so. Go to Google.
You'd be going this other place for the wrong reasons.
And I you're a passionate guy. Your energy level when
you're talking about Google is ten x. What is the
(17:19):
other thing? And she's like, we'll figure it out. We
don't we by the way, we had no money. We
were living on one bedroom apartment Eightio six and Columbus,
And she said, whatever, we'll figure it out. You know,
don't worry about it. So anyway, so that's how it
went down. What was it like being on the Google
train in those nine years, because that's when it went
from Google to Google. It was like the world's most
(17:40):
intense science project. First years there, it was unmitigated mess
like a messy science project where we were testing everything
and and like you know, when they hired me, by
the way, there's a funny story. So when they hired
me that they gave me like a one page sheet
that said we're hiring you this, here's just salary, here's
your act. And by the way, if it doesn't work out,
(18:02):
no harm, no foul. The reason I was able to
go to a o L was I didn't have a
noncompete because Google didn't know whether or not they were
going to be big in the ad business. So they didn't.
I had this like sheet of paper that said, you know,
if it doesn't work out well, just part ways, no harm,
no foul. So anyway, as long astorry short as the
first order I got, I said, I have an order
coming in for advertising, you know, and um, Larry and Sergey,
(18:25):
I said, I need to get a fax machine because
I can't get the order. Just said that we're clear.
They made you head of head of US right ahead
of US sales sales. And I was in New York.
I was in California. So my harmon in New York
was the first office outside of Mountain Views. So I
get the first order. I called them. I say, guys,
I gotta I got an order. And I'm like, I
gotta buy a fax machine. And the fax machine was
like I don't know how much it was. It was
like a bucks. I'm like, I gotta buy this fax machine.
(18:48):
They're like, prove that you have the order. What They're like, yeah,
proved that you have the order. I'm like, guys, I
can't get the order. Let's have the fax machine. They're like,
we don't want to spend the money on the fax
machine unless you have the order. And I'm like, so
we had about another lesson Larry and Sergey, we're cheap
(19:09):
and they were. When you go to Google's profitability, while
Google is so profitable, it's because they were super super
good with expenses and where money was that they'd rather
spend money on tech than spending on a fax machine.
And by the way, I totally get that and respect that,
but that story is the story. Like that's like having
an order and fighting over spending a hundred twenty dollars
(19:31):
on a fax machine. That's that's a true story. One
thing Google did that other people did not do in
people in media business today still don't do this, which
amazes me. This is Google's secret. Every single week, we
used to look at the high performing customers and low
performing customers, and if you were below a two percent
click through rate in our ad program, even early on,
(19:51):
we kick you out of the program. So you let
clients go and you let money go. Yes, And because
we wanted the highest quality stuff for our end users.
And what it did was it trained our algorithms and
what good ads were. So if you think about today,
Google has pretty much mopped up the entire ad business,
and Facebook has and those those type of companies. And
(20:12):
one of the secret sauces to that is they put
in a quality algorithm. Forever you can see how many
bad ads you get as a human everywhere you go.
They put in one quality algorithm that changed the entire game.
And by the way, if you're a customer and I
call you and say, hey, Ryan, you can't run your
ads unless they're high quality, I'm gonna kick you off.
What do you do to your ads? You make them
(20:32):
higher quality, make them high quality if it has a
network effect, right, So, and customers used to complain about
it all the time, but we ran it and did it.
And you know that's a lot of the foresight that
that that you know, Larryon's had and the team had,
and you know, we did tons of testing. It was
a lot of fun. My world was Monday through Thursday, California, Friday, Saturday, Sunday,
(20:53):
New York. So I was living in this bicoastal every week,
you know, life. And I saw the difference between how
New York City was doing business and how Silicon Valley
was doing business every week and I could see I said, Wow,
these guys are We're going to mop up the whole universe,
you know, just that openness, the openness, the learning, the science,
you know. And my friends in New York where you know,
(21:13):
they were all in different industries, but a lot of
New York was like, Hey, I'm gonna beat your head
in and I'm the best at this and it's my
way or the highway. And California was like, hey, you
have a good idea, come on in this room. You know,
it doesn't matter what your what your hierarchy is here
you have a great idea. You speak, you know, and
it was like over and over and over and over again,
big difference in culture. And then walk me to you
(21:38):
know that role where you basically, you know, you were
an entrepreneur. You had the newspaper and then you started
working for other people as you you know, created your
net worth through your network and you kept building a
building building, And then Patch Media came around. I did
associated content with my roommate from college under rug you
end up running it as the biggest investor in it,
and then we I did Patch and social content ends
(22:01):
along story end up selling the Yahoo. It was a
very good financial transaction SOLDI Yahoo and Patch. One of
my theories was local news was going to get destroyed
newspapers because they weren't transitioning fast enough. Local news is
the most important, one of the most important things in
the United States has as a as a country. So
I started Patch with John broad another another another really
(22:22):
close friend of mine and somebody I worked with before.
And John and I tested in three towns and then
we started scaling it up. And then our goal was
to basically put digital news site in every town in America.
So we eventually got up to the point we're in
three thousand towns um in America. And and I had
(22:43):
taken then a o L job time Warner had bought Patch.
Patch was part of the thing I was doing at
AOL at that point. I unfortunately I an activist investors
actually now a friend of mine attacked us at a
o L and I had to sell Patch because they
thought we were spending too much money on it. But
to still it's profitable and growing, and the people who
(23:03):
own it now are Charles Tayle and Hail Company. They
great people, done a great job of it. And I
still think local news is one of the bigest white
spaces for business in the in the US. That's so
cool that it's still there. What did it mean to
you to, you know, have that interview with those guys.
You're interviewing yourself, and then you get to a point
in your life where that one negotiating item allows you
(23:27):
to cash out for for that amount of money, where
you could take five million of it and put it
into this new company that you are now completely in
control of, like it's it's a huge company that everyone
knows around the world. I mean, what was your mindset
like at that time, because most people would say, I'm
out take me to the island, and you said, no,
I'm gonna go run AOL and I'm gonna rebrand it,
rebuild it. I'm gonna help him out. And then and
(23:49):
then you obviously didn't stop there. I haven't saying learn
to earn. And when the A O L opportunity came up,
I met with Jeff Bucaus, who was the ceof Time Warner.
You called and said, hey, can we have a meeting.
I thought it was about the Google Time Warner partnership
is all another story could a huge deal with with
those guys. But over there he said, hey, we got
to spend a while out of Time Warner. Would you
be interested in being CEO, and so I um left
(24:12):
the meeting. I called my wife, called a couple of friends,
and you know, one of my friends said to me, Tim,
you went from a company that was almost zero at
Google that went to a hundred and fifty billion market cap.
And you before that were at Starway that got bought.
Before that, you were with Rick Scott who was it
was the governor of Florida and then senator by the
time Perdeers that the CEO of Columbia h c A.
(24:33):
We bought a company, sold the News Corps. So I've
done a bunch of other things. So he said to me,
you know, the only thing you don't have your resume
is like, why don't you do a turnaround? And so
I thought, you know what learned to earn. I'll figure
this out. You know, I don't know how I'm going
to figure it out, but I'll do it. So I
made a fairly fast decision, actually did it. I told
him Meat and Larry and Sergey, which was pretty painful,
(24:54):
and ersh Smith and then Um and then went to
do it. And then what I did is I went
back to zero. They sorry, did they did? They make
you give yourself an exit interview. Now they I was
in a room with them for two and a half hours,
and they pretty much told me how stupid the decision
was and why I was going to regret it, and
you know, blah blah blah blah blah blah blah blah.
(25:15):
And so I sat there for two and a half hours.
I didn't feel it very good by the time I left,
but I just said, I just said, I just know myself.
I've been here for almost ten years, and you know
I don't have to grow. So so I I left
one thing. I did a well, which I took advice.
I called a bunch of other CEOs, big big ceosum
just to ask for their advice, and a couple of
them told me, you know, to me, got a it's
(25:37):
a different job being in the number two chair, number
three chair or whatever like, it's just different. I was.
I decided myself, I just did it again. About three
years ago, two years ago, want the left horizon. I
went to zero. I said, I know nothing. I'm gonna
start from scratch. So I read every single book I
could be about a CEO. I went to see Howard Schultz.
(25:57):
Ken Channel Jack Welch has called these people and said, hey,
can I come pick your brain about how you're the CEO? Yes?
What's the job? What is it? What do you do?
You know all these other things. I'll tell you some
stories like So I went out to see Howard Schultz.
Look to see Howard Schultz. I had a whole strategy
plan with me. I've done all this work at a
well already like boom, you know, when out there, expected
to show him the strategy and give me feedback. So
(26:19):
he's about the deck, I said, Howard, I knew him
a little bit. I said, you know, I got this deck.
I want to show you the strategy. He said, put
the deck away. He said, where's your people plan? And
I said what? He said? Where's your people plan? He said,
being a CEO is about people. And he said the
two things you need is a people's strategy and you
(26:39):
need an awesome head of HR. Then we'll talk business strategy,
but I want to talk to you about people first.
And I would say that was the most impactful conversation,
you know, and general the other ones were super impactful too,
but I'll just that's just one quick story, and it
really helped me. Reset really really helped me reset, and
so I kind of tried to cheat as much as
I could. I tried to steal everybody else's knowledge and
(27:00):
start with that. And you know, I made a boatload
of mistakes and I we we had a boatload of
success also. But I I credit a lot of the
help I got from those other people for why we
made it through some of those situations. I have a
lot of advice on that topic about mentors and stuff
like that, but that they were so helpful and so
(27:20):
gracious with their time and energy. And then he became
the CEO of another company. Yes, so I started a
company g t X, And that's a company we're doing
now tell me, tell me about it and what it
is and why you started it. Yeah, So I started
because I think the structure the internet's broken. I think
there's too much value in the middle of the marketplace.
I think the really big companies. I think there's been
(27:42):
more more ability for brands and people to go direct
to consumer. I think that like it's really important to
have an ecosystem. So I'm much more into moving value
to the edges of the marketplace, back to consumers and
back to businesses. So the business we built is essentially
a direct to consumer company that connects offline to online
(28:02):
and gives people control over their information and data, both
on the consumer side and on the brand side. I
just think for someone like you, for instance, I'll tell
you one thing. There's one thing people don't realize about
the Internet. Most of the brands on the Internet and
a lot of the influencers on the Internet rent their
own customers. And what I mean by that, I've had
this conversation with a lot of people is they're like, no,
(28:23):
that's not true. I have a million Instagram followers or
twenty million Twitter followers, and I say, yeah, but what's
their address? How do you directly communicate with them? I
do it over those platforms. Like yeah, but the platforms
own those customers and you're renting them. I want more
people to own their own customers. Do you think learning
that and allowing people to to own their customers? Is
(28:47):
that what you're bullish on right now? As you think
about the next ten years, because before we know it's
gonna we're going to look back, you know at ones
is this wild time a decade ago? Yeah? I think,
by the way, here's the deal for for your business
in particular, you know, you have your film and acting background,
you have the real estate background, you have the entrepreneurial background.
(29:09):
You're someone who deserves to have a direct relationship with
all of your customers. The reason is not just for
your business, but because you're somebody who adds value outside
of your business and you have other interests. I think
it's your your and principle. A lot of people in
life will benefit by having a direct relationship with you
(29:31):
because you bring the and principle. You might help them
doing your core stuff in real estate, but you might
also help them in something else you know that you're
interested are doing. And that's like, that's the network effect,
and you're not going to have a network effect if
your own relationship through everybody is instagram one way relationship.
You as a great there's a great tool and a
great platform, but hey, why not have relationships with everybody
(29:52):
and know who they are and know where they live,
you know what they want, you know, serve them more things.
One of the last questions I have for you, and
I reached out to you and asked you to do this,
and I told you the title of the podcast is
big Money Energy. Without knowing anything about it, what did
you think, well, I'm just gonna tell you something. Honestly.
One of the other skill sets I have, which I
think it was kind of maybe as the quality that
was born with, is when I meet people, I sometimes
(30:18):
get like a sensation that I know that they're going
to be super successful. So the minute I met you,
and I can name a whole bunch of other super
successful people I've met, even when they weren't successful yet,
that I was like, this guy is going to be successful.
And again going back to the stage point, I'm on
your team. Anything you want me to do to help you,
(30:38):
I'm gonna do only because I know you have the
draw from talking to you for you know, a minute
and a half, I was like, this guy knows the
formula a lot, and he's working the formula and in
a good way for for humans and sharing his knowledge.
So when you asked me to do anything, I said,
of course. And I and I think that the energy
(30:59):
piece is important. You know, Jack Welch said something and
I think it's in one of his books. You know,
he he had a way to assess people. In the
first two assessment of these things, the four ease and
a p um and a couple of other things, but
two of the first four ease were energy number one
of yourself and two is to be able to bring
out energy and other people. And you have that. So
when you asked me to do this, I figured it
(31:20):
would probably help build the stage, maybe maybe for you.
I don't think you are. You already got your own stage,
but you know, maybe somebody else gets helped um So
that that's what it is, and I think you have
that the first two years. You've got all his principles,
but you the first two eads are like your titles,
speaks right through that. This has been great. Thank you
so much, and have a great rest of your day.
All right, all right, seem if you're ready to take
(31:44):
action today. Based on Tim Armstrong's entire blueprint for how
he got to where he is, go to Big Money
Energy dot com slash podcast to download an action plan
I put together for you, as well as the show notes.
That's Big Money Energy dot com slash podcast. Find more
podcasts like Big Money Energy on the I Heart Radio
(32:06):
app or wherever you get your podcast. Big Money Energy
is hosted by me Ryan Sirhand. It's produced by Mike
Coscarelli and Joe Loreesca and executive produced by Lindsay Hoffman.
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