How Kindness Became a Billion-Dollar Business Strategy with Daniel Lubetzky

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He founded Kind Snacks and built it into a multi-billion dollar business while always keeping the namesake top of mind. And as the great poet Rihanna once pointed out, kindness can be mistaken for weakness. But that hasn't been Daniel's story. He's shown a lot of strength while being kind and building his company. For example, during Kind's history, he bought out a PE firm for $220 million in order to maintain his leadership. Today, he gives us the behind the scenes of that story. And we also talk about the difference between being nice and being kind and how he's supporting other founders through his firm, Camino Partners and on Shark Tank. I am so excited to say, Daniel Lubetzky, welcome to Money Rehab. I'm excited to be with you because you and I knew each other way back when you were a young kid. You were a young kid. Where did we meet exactly? I seem to think it was a dinner. Am I right or wrong? I think the dinner was after the interview. You came on my early morning show on CNBC. Super, super early. I think so. Englewood Cliffs. So you're saying you interviewed me and then you invited me to dinner or we just met at the dinner randomly? I think I interviewed you. This is what, 15 years ago at this point? 15 or 20. When did you start? I was right after the financial crisis at CNBC. So 2009. I think we had you on the show. We were pitched kind and I was like, I love kind. I do remember when you came over and we hit it off. I think your PR pitched us. And at the time, kind wasn't like the cool, sexy thing. And I grew up in LA. So I went to these small natural food stores, which I'm sure you know all of them. There was like Mrs. Gooch's before it was Whole Foods. There was another really small like mom and pop near Fairfax. It was a one-store operation. For sure. And it was a disheveled thing. It was not a cool thing. Her one was like this really granola-y place and it was real, but it was a one-store shackle, a real natural store. It was not like the CNBC and silly thing that it is now, which is – it's cool, but it's very different. I can't wait to hear what you think about it. I like it. I enjoy it, but it's kind of like a CNBC in place now. It's not like – back then it was like just people in their neighborhood needed healthy snacks. Like healthy, grunchy granola people. Now it's like... Better merchandising today. For sure. I just give them my wallet every time I go there, no matter what. It's like crazy. The prices are crazy. Merchandising is very good. But I saw Kine early, early, early, 100,000 years ago when you're like, I'm sure, you know, didn't have mass distribution. You say you discovered Kine. I, as a consumer. So I loved it. And when we got pitched for the show, I hosted a super, super early morning show on CNBC. I told my producer, I'm like, I'm a big fan. Like, I think this is a great company. This is going to be a big company. I should have invested. You should have given you shares in the company. My God. I should have said, come on the show. That's the thing and everything started working. But 2009 was a very important year for us. It was when our growth started going from like this to like this. But the predominant reasons. Maybe. But also what happened that year is we started sampling. Because I know you have a show about money and I can fast forward if you don't mind. And what I was doing right, and then I'll tell you what I was doing wrong, is that I wasn't wasting money because I had no options. I had no money. But what I was doing wrong is I created instead of a resourceful culture, a frugal culture. And so I was not spending any money. And I saw sampling as a cost center. I'm like, we had an $800 budget in 2008, $800 budget for sampling. and it was samples that we gave to the sales people to give to the buyers not to mortals that want to just eat the product and we finally realized that for every kind bar that we gifted people would fall in love with it and we sold within it was crazy the roi like within weeks people would buy enough product to justify our free sampling and they would tell others it was like word of mouth it was excitement people very excited about the product so we started sampling We went from an $800 budget to an $800,000 budget in 2009. And things started just growing. And then within a few years, our sampling budget was $20 million. We were giving $20 million in free kind bars. And every kind bar paid for itself because people would become part of the family and start telling others about it. And then you went on CNBC with this lady. This lovely, smart woman that talks about money. History. I'm so, so happy to see you. I didn't know if you would even remember me because you came in. I remember you perfectly and very fondly, except I didn't remember where we first met. But our memories and our minds play so many tricks on us. One of my other things that I have is I had a beaten up car that I brought. I drove it from law school to New York and I used that car to deliver all of my products from the back of my truck. And because I would park it on the streets, because I couldn't afford to park it elsewhere, it would get hit and the trunk was not working. So I closed it with duct tape. So when I wrote a book, Do the Kind Thing, in 2014, I wrote about that car and I talked about how I was riding my red Cougar and parking it in my friend's fancy house in the Hamptons when I would visit with a duct tape and the parents were very nice. And he's like, you know, that was very sweet that you mentioned that, but your car wasn't red. I'm like, what? Like your car was black, you idiot. And I'm like, holy shit. Because my first car, well, my second one, my first car was a broken ground Victoria. That was $400. But it broke down and my dad's like, okay, I'm going to help you out. But my first car was a used red Cougar that I used for many years while living in Texas. Then I moved to Stanford to go to law school. I'm there three years with that black car. several years with the car in New York. And then I sell it and many, many, many, many years go without a car. And for some reason in my mind, I remember the car as being that red car. It's incredible what... The Nelson Mandela effect. Yeah. What is that? There's certain things that our mind tells us were true, like the red car that wasn't. And we convince ourselves of that. People see the Monopoly guy with a monocle, but he doesn't have a monocle. And there's certain things... He doesn't have a monoclonal. You're freaking me out, woman. But regardless of where we met, I have always felt so fondly of you. We've been in touch over the years on email. Your book came out. My five books came out. Only five? I'm such a loser. Five books. That's impressive. But I always really just remember how you make people feel, how you've always made me feel, how I know from all the interviews that you've done since our first one back in the day that everybody just thinks you truly are like the embodiment of being kind. It's a very dangerous thing to live up to and I don't think it's true. I do think that I aspire for that and that's good enough. I try to do my best, but I get upset just like everybody else. I make mistakes like everybody else. But I try my very, very best to live the way I would have, my parents would have wanted me to, the way my dad would have wanted me to do it. And my mom's still with us. She wants me to be a jerk. No, I'm just joking. But my dad's not with us, as I said, the way he would have wanted. But I think it's a lot about just striving for that. Because if you strive for that, then you actually, we did a survey at KIND. And it was fascinating that 90% of the team members felt that after joining KIND, they were happier and had become kinder themselves. And it was not something we set out to do, but when you're thinking about making kind of state of mind and you become what you live, right? You live the experiences. We become a product of our little interaction. So if every day I'm opening the door for my team members and I'm looking at people's eyes and I'm trying, I'm going to be a very different than if every day I'm just shutting the door on people. And like you become a product of all those tiny interactions. I think you're doing great. And I think a lot, and I talk about on the show a lot, the difference between being nice and being kind. What do you think the difference is? Because the way I think about it is the nice thing to do is telling people what they want to hear, but the kind thing to do is telling them the truth, but with kindness. A hundred percent. And in the context of life and work, a person that is nice is polite, but a person that is kind is honest. and I'll take the latter a thousand times over the former because you're nice. Sometimes you're nice and you're actually harming a person. Like, for example, when you are in a job setting. Literally this happened to me a week ago when one of our team members was not performing and not one but two people that she interacts with noticed that and were very unhappy. And the situation got out of control and they almost wanted to let this person go. And I said, well, have you given that person feedback? And both are really good people, but they didn't have the strength to be kind and provide that person feedback. And I am 100% certain about this, that it's a bigger problem with the workplace that people are too nice rather than that they're jerks. Of course they're jerks, but there are a lower number of problems than the people that are too nice. and because they don't want to hurt other people's feelings, cause harm to their colleagues and deprive them of the gift of feedback. So it's very important to be kind, not to be nice. A person that's nice doesn't cause problems, but a person that's kind has to stand up to solve problems. A person that's nice is not a jerk, but a person that's kind stands against jerks. A person that's nice is not a bully, but a person that's kind stands up against the bully. So kindness requires the strength of being a protagonist of having agency over your life. You can be nice and be passive and just be polite, but to be kind, you need to be part of it. Yeah It easier to be nice Like I have a co who sent me a clip of him on TV And the nice thing to say was like you did amazing Congratulations It was awesome You so good But the truth was I thought he could use some feedback. And so I, it took extra time to be kind and to give him constructive feedback. Because that person might not receive that feedback well, and then you're putting yourself out there. So it does take a lot of strength. So how do you think about it in the workplace? So let's say I'm that person that needed feedback. I wasn't performing. I wasn't turning myself in on time. And you're the boss because you have to run an organization at the end of the day. How are you giving me kind feedback? Just to be clear, when I was starting, I was messing it up completely. But over years, I realized that creating that kind culture is what made us win. We had the best product, I think, in our industry. Just like in the finance industry, cash is king. In our industry, product is king. Queen. But in our industry, product is queen. And we have to make sure that you have the right product. But if you really want to win, you need to have the right culture. And to have the right culture, you need to have a hearty debate, a comfortable place where people can speak up. One of the biggest dangers today is that people are afraid to speak. And that just fosters mediocrity. So you have to be able to create a culture where people trust each other to provide feedback. It should be constructive feedback. So the way we taught our team and the way I try to teach myself is the sandwich technique. You start by giving people some positive affirmation. Never lie. Don't ever just throw away something that's not sincere because then they don't trust you. This is the compliment sandwich. The compliment sandwich. But start with something that's authentic. Share something that makes them personal. something you have to be able to find one thing that you respect in that person that they're doing well remind them that then provide the feedback about where they can do better and explain frame it that's intended to help them and then you can close with how that's going to help strengthen and make them stronger that's kind of the fundamental framework for giving people feedback if you ever considered another name for the company early on or is it always kind we have the weirdest silliest names and when you look back i have that piece of paper i need to find it but it's crazy how we how lucky we got because all the other numbers were names were very descriptive it was like healthy snacks like fruit and joy fruity not we had like fruit not delights the light of the times like fruit delicious nuts in the world and they were all very like variations of descriptive fruits and nuts. It reminds me like when my son, you have a young kid, but when my son was three or four years old, we bought him a fish and he happened to be orange-reddish color. And he's like, what do you want to call him? He's like, red. I'm like, okay. And then he got another fish and what are you going to call him? White. He was white. And then we had a fish that had red dots and white. And he called him, that one's going to be called red-white. so that's what that was the level of mastery of our naming and then uh that year my dad passed away and it was a very very tough year but sasha hair who was my director of marketing at the time and i were playing with a name that could have human adjective that could describe the three pillars of our product which eventually became kind to your body to taste buds into your world something that was healthy tasty and socially responsible but when we were thinking about it i I had my dad front of mind. And what's interesting about my father is he was in a concentration camp in the Holocaust. He survived the war. He was 15 and a half when he was liberated by American soldiers. And in spite of all of what he went through, he was very, very much, he really was the kindest person you could meet. And he found a way to see everything through a positive prism. And so we were inspired by his example. We named the company Kind After. Better than Fruit and Nut. Yes. And early on when you were starting, what were you doing for funding? You had an $800 sampling budget. You were completely, literally bootstrapped like your car. Yeah. Well, earlier on it was even worse because I finished law school. Thanks to my parents, they helped me pay for my education. So I didn't have much debt. And I had a couple, a little income because I had run some businesses on the side while in high school and in college and also as a legal associate. So I had like probably a small amount of money. And I used that to start and my father gave me a $100,000 loan, which helped me enormously. And then I got... What year is this? This must have been... I started PeaceWorks in 93. And so probably 1994, 95. And I was able to repay the loan. I was very, very proud. But the company, PeaceWorks, was going sideways. And for 10 years, I was barely surviving with the PeaceWorks things. I didn't know what I was doing. And it was a concept of using business to bring Israelis, Palestinians, Jordanians, Egyptians, and Turks together. And eventually, we had ventures all over the world where using business to bring people together, to have commerce, shatter stereotypes, cement relationships. That was a concept of PeaceWorks, using free markets to bring people to work together because they have a vested interest in profiting and succeeding together. But I was doing everything wrong, Nicole. The first brand was called Moshe Pupik and Ali Mishmumken's World Famous Gourmet Foods. And I thought it was a genius name that people were going to laugh so much about, but they just were paralyzed. they can't repeat it, they just walked away. As someone who remembers Yiddish so fondly, I appreciate it. Moshe Pupik is like a name of a character, people joke that it's a joke. But a Pupik is a belly button. Belly button. And Ali Mishmumkan is Ali the Impossible. It was, there was a whole story of the characters and I was so in love with my own stories, but people were like moving on. That's why eventually we just named it Kind, which is four letters. Nailed it. But during the PeaceRox years, we were struggling a lot. And I was able to eke out a profit, but barely. So I had a $24,000 salary for 10 years in a row. And it was very hard. It was hard to make ends meet and to make payroll. I was sweating every month to make payroll. And it made me work those extra hours to sell those extra cases of sundried tomato spread in order to be able to make payroll. So yeah, it was... He was bootstrapping like crazy in the early years. And then in 2008, can you tell us the story of the PE fund that came in? Because this is so badass, what you did. We agreed to sell to them a minority stake. And they were good partners the first several months. And then afterwards, they got greedy. And they tried to force me out of my own company. I don't know if you know that story. I kept it to myself. I couldn't talk about that. I felt very traumatized by that. But they tried to push me out. After six months, they said, we want you to name one of our investors and partners the CEO, and you will be a minority shareholder. And I'm like, well, that's not the deal I did with you. The deal is I'm the CEO. I'm the founder. I'm the entrepreneur. I'm going to run it. And you guys are getting a minority stake. and they're like no we think that if you run it it's not going to work out we want to buy you out and I said that's not what I bargained with you and they're like well if you don't do that we're going to take all of our people and take them back because they had introduced me to people that I had hired and we're gonna we're gonna destroy you and you're gonna go out of business and I was really really i couldn't sleep for many many days and because you also almost feel like oh my god is this like are these people that they introduced me trojan horses that are going to harm me and i eventually consulted with a lot of friends and they're like call their bluff we'll replace them we'll buy them out and i told them that and i told my team and one of them actually We carried through and left with them, but everybody else stayed. And the private equity firm also changed their mind and said, you know what? The two other investors are going to leave, but do you mind if we buy their stake? And I made the mistake of saying, fine, I should have known that when people act that way, I should have just bought them out. But at that time, I felt so intimidated by the whole thing. I'm like, I just want stability. So we agreed to keep them on board. They bought their other partner shares. And then four and a half years later, they wanted to sell the company. I had made the mistake to have a clause giving them the right to shop the company around at year five. And so I thought five years before that if any entrepreneur is like here where there's so many cameras, This is a really cool studio. Thank you. But if any entrepreneur is listening, try to keep your options open because you never know what you're going to want to do four or five years from now. And I had agreed that we would sell the company or shop around the company in five years. And I changed my mind. I had climbed that little hill and I saw a higher mountain and I wanted to keep going. And they're like, no, we want to shop around the company. I'm like, no, I want to keep running it. So we agreed that I would buy them out. But it was very hard and they drove very, very, very hard. They got 17x in the course of four years plus dividends because we were cash flow positive. We were making money every year. So they got a crazy return within four years of 17x plus dividends, so maybe more. And we bought them out. but it was hard because they had put in like $16 million. I needed to find $227 million to buy them back. How did you do it? Bank loans? Bank loans. And it was a calculated risk because I had a lot of information about the company's well-being. So did my investors, but they had a fund and they wanted to get out because they had a five-year time frame and they wanted to put a win in their board. But there's very often misalignment between funds and entrepreneurs because the entrepreneur might want to continue growing, but the fund wants to bring their success to be a reality. And they have five-year timetables to be able to create value for themselves, get their fees, and then raise more money. So the way they make money is by raising more money, and that was not my incentive. So we had enough intelligence to get a sense that there was a potential for things to turn out right. And fortunately, they did. But there was a six-month to a year period when I was sweating a lot. I think the theme is that I'm sweating a lot. But it was a very tricky period. The other thing, Nicole, is that when I met you, I wasn't sleeping. Neither was I, by the way. I don't know if you remember, if you look pictures of me in that era, I look like a raccoon or like a phantom because I was sleeping four to six hours a day. And today I have the benefit of like I finally conquered insomnia and I think I'm a genius because I finally after 44 years of insomnia, I sleep seven hours, eight hours a day and I feel amazing. But it's also a luxury because I didn't have that back then. Back then, A, I had to work 16, 18 hours a day to just make things work. But B, when you're an entrepreneur, the highs are high and the lows are low and you're on this roller coaster and the emotions take you over. So during those episodes, you're not sleeping. You are – and I don't know if I had developed the skills that I developed now to sleep. I don't know if I would have had them because back then it was a little bit more of a survival mode. Of course. So I would ask you the key to sleeping or to cure insomnia, but I am assuming it's correlated with also exiting the company. So the one that I cannot perfectly answer for is all those things. I do think that it's too easy for me to say that I developed it and that that's great because if you have those worries, I do think it's going to make it harder for you to get quality sleep. But there are things you can do. The most important intervention far and away is go to sleep at the same time and wake up at the same time. It is insane how powerful it is. And for many years, I told myself that that was not me, that my wife goes to sleep at 1030, wakes up at 630 every day. And I looked at her and I'm like, that's not me. That's just not my personality. I'm too creative. Bullshit. If you train yourself, your body eventually learns. So it just takes a while. You have to be patient with yourself. You have to – it doesn't happen the first day you do it. It might be weeks. But if you keep going to sleep at the same time and giving yourself some time and waking up at the same time, eventually your body learns and it is amazing. And there's – I actually did a video if you go to my Instagram on the top 10. It's in my opinion one of the more important videos that I've done and it has only got like 10,000 views which I think is regretful because it's – Let's boost it. Let's go. But also, Daniel, let's be real. Part of it was exiting your company. Honestly, I cannot be 100% certain that if I had done the 10 things that I'm encouraging people to do now, that would have worked when I was like, if you lose an account, right? If you have all of your net worth and kind and all of a sudden one of your key accounts kicks you out and introduces a copycat club Yeah you not putting your mask on and being like night night Yeah it is There should be the humility to accept that entrepreneurs don have the luxury to try to sleep eight hours I didn't have the time to answer. Like one of the things that I used to do is I used to stay up till I finished catching up with my inbox. You're inbox zero? Not today. But back then, I never was in box zero, but if it was on red, I got through every night. But sometimes I would stay up 11 p.m., 12 midnight, 1, 2, 3, 4 a.m. in the morning just going to inbox zero. I didn't know that was a term. But that took a toll. And the problem is that when you go to sleep at different times, your body doesn't get good quality sleep. It's not just that you get less hours. It's also that the quality of sleep goes down. Totally. I was a disaster. I mean, I went to work at 1.30 in the morning. I don't believe that for a second because you look like you. I don't know. We can't compare pictures. I look like a rat. You look exactly the same. Like a phantom of the opera raccoon. What would you tell entrepreneurs about private equity deals? Because you hear so many disasters. I think the most important thing is neither, you know, now that I'm an investor, I also, So I always thought that the entrepreneurs are the good guys and the investors are the bad guys. And the truth is more complex. Everybody is driven by their own narratives of who they are. And everybody is a human being. But the more decisions that everybody makes, everybody rationalizes to be consistent with their decisions. So you need to look at the body of work. Look at the person in totality and look at their reputations and understand who you're getting in bed with. because odds are that – and by the way, Kind hit it out of the park. My problems with my private equity partners happened in spite of the fact that Kind was their best-performing company and they still did those things. And after they got the biggest return in history, within three months, they had invested in three competitors and given them our playbook. It was really annoying. I'm sure that's a very kind way to say what you really think about it. No, but there were things that I learned from them. I also, to be honest, there were things that I learned from my partners that helped me get to where I got. So it's a complex reality. But the truth is that for the most part, product equity companies are doing this for a reason, which is a market reason to make money. And you need to really understand what their motivations are. I think the most important thing is align incentives. Find the best. First, look at the integrity of the people. And then second, try to align the incentives. And then you have a better chance that things will go well if you find people that are good people and the incentives are aligned so that as they grow, you grow. Very oftentimes, the incentives that are negotiated are misaligned, and that creates a lot of problems. When did you decide to get out completely? Because you're out financially, not emotionally, I'm not sure. Last December, I sold my final stake in Kind. But it was not something I decided last December. It started in 2017 or late 2016, early 2017, when we brought our strategic investor to invest in Kind. And they wanted to eventually acquire Kind. And I decided at that point that it was worth doing it. And it's a tough, tough, tough decision for an entrepreneur to do. Do you feel like it was your baby? A lot of entrepreneurs talk about their baby, like they personify it. It still is my baby. It still is my baby. First of all, the company that acquired Kind, Mars, has done a good job at preserving the Kind promise, meaning the ingredients are the same, the product is the same, and I'm very appreciative of that. still for an entrepreneur it's very very hard to see your baby move on and it's it's very easy to feel like a gigantic behemoth is not guiding your baby the way you want it to be guided and taking it in the right direction and making it the center piece of everything you do so it's particularly when you're the founder and entrepreneur i started the company from the windowless basement of my building. There was a trash compactor across from the window, from the office, and there was nowhere to escape that trash compactor's fumes because it was a windowless basement. Sometimes you want to jump in there, I'm sure. It was a journey where I was a one-person operation, then two people, then four people, then eight people, then two people. You lose everybody. It was a very long journey. And then all of a sudden, turbo growth and 500 people and, you know, incredible multi-billion dollar sales and being part of every path. It's just an incredible growth experience. You grow and you learn so much. And it is part of your identity, like handing out kind bars. You brought some today. I still, by the way, I don't have a stake in the company anymore. But one of the things that I agreed on with my former partners was that I would get some kind bars because I like gifting kind bars. So I have a budget of kind bars for a few more years because that was important enough to who I am. You've done it for so long. Yeah. I mean, it's a hard habit to break. Yeah, and also people expect. Also, yes. We were hoping for some kind bars. Really, before you came, I was like, I'm so hungry, but I know he's going to bring me a bar, so we're good. What is it like doing business with Mars? Notoriously, they're so opaque and secretive. The cultures, they're good people. I think they have integrity and good intentions. The culture of an entrepreneur and of a large company are very different to your point. A large company tends to be a lot more cautious, a lot more secretive. A large company tends to be more defensive. And an entrepreneur tends to just want to pounce on all the opportunities and be more transparent and be more assertive. So the cultures were different. And that's a tension that almost no entrepreneur can overcome. meaning every single time that a friend of mine has been in this situation, we all think that we can suspend the forces of gravity and that we are going to be the ones that do it differently. And the reality is that as a large company acquires a small company, and Kind was a $7 billion company, but compared to other companies, it's not. I'm trying to be respectful of confidentiality. That's one of their sizes, but they're much, much, much, much bigger. I'm surprised that you're saying this much. so I appreciate it. But anytime that an entrepreneur does a partnership with a large company, they need to expect that there's going to be a natural friction between the different cultures. I know. Every entrepreneur is like, this time will be different. And it's a similar playbook, but it's so cool to see you now on the other side of it. It's so cool to see you on Shark Tank. It's so cool to see what you're doing with Camino Partners. How do you think about supporting founders now on the other side of the equation? Well, it gives me a lot of energy and meaning. First of all, Shark Tank, what it does is it's teaching young people entrepreneurship. And it's one of those rare shows that both it's entertaining and educating at the same time. It's very engaging and the format is really fun, but you're learning how to build companies. You're learning about entrepreneurship. And then Camino Partners is a platform where some of the most extraordinary people that I was blessed to work with are now leading the way. And we only get to invest in a couple companies a year, but we're trying to help them fulfill their potential and try to fulfill their dreams. And it's really fun, particularly when you find an entrepreneur that wants to learn, that wants to listen, and they take your feedback and they do something good with it. It's so fulfilling and so meaningful. How did Shark Tank happen? I don't know 100%, but I think Barry Posnick, who's one of the producers, saw an article about me and shared it with fellow executive producers and then they invited me for a conversation. And I love the show. I was a late adopter to the show. I didn't know that it existed. I remember my first time I saw Shark Tank because I was on a plane. I'm the type of person that if something looks interesting, I'm that annoying person that asks, excuse me, are you watching? I'm sorry. I'm very friendly. Earlier today, I was on a board call, and there was a baby and this lady walking, and I said hi to them. That's just my personality. I can't wait to bring the baby at the end of this. Yeah, I want to meet the baby. but where was so i was on the plane and i saw on a screen this weird format because people are sitting down and they're talking i'm like what the hell type of format is that it's not a it's not a scripted show what the hell is it so i asked somebody and they told me what it is and watched it and the entire was a long flight and i watched many episodes and i fell in love with it and i would play it to my kids to watch it and i would pause and teach them and ask them what do you think would you do it it's a fun show to pause with you well the kids maybe don't like now when i pause but back then they were little they would they would indulge me and then when they called me i'm like yeah i would love to do it and then they they do like a little screen where they there was like four different interviews and eventually they invite you and and you crush it as usual what's been your favorite moment or founder or pitch that you've had on the show oh it's so hard to to answer it that way because or memorable so like good or bad I'll give you one quickly, but just so you understand, the way it works is you show up at 6.45 a.m. in the morning and you finish at 8 p.m. And you're back to back to back recording 8 to 10 segments. And then the next day again. So it is hard to – but let's say in this last season there was a really fun situation with these two crazy guys from Google. They work at Google and they came up with this. They saw the problem. What I love about SharkNet is the entrepreneurs come up with really creative solutions. And they're surfers themselves. And nobody wants to wear helmets because they look so nerdy. So they came up with a way to make helmets cool. And they come up with like a fun way to wear a helmet. And it was so clever. And I wanted to do the deal. But I think they had three sharks vying for it. and the other sharks actually had a better deal than me and they went for mine and you know we all have a little bit of a competitive ego i was like yes and the i think barbara got upset at them like why did you not even consider my offer when my offer was better why didn't you respond and they said because we know daniel had done a deal with tandem surf which was a company that's also in water sports and so we thought that he had synergies and barbara said it's a great answer no problem i actually get it and so but it was like all the dynamics that go into shark tank where it's very real like what's cool about the show is that we as a as a sharks don't know who's going to present we don't have any information so we need to solve the puzzle on the go when you know every segment films when it's edited eight to eleven minutes but we don't get that much more It's unedited might be 30 to 45 minutes, rarely an hour. But within 30 to 45 minutes, you need to decide if you want to invest, negotiate and develop the strategy to how you're going to win over the other sharks. And that part I'm not that good at because I'm very transparent. And then the sharks see, oh, he wants the food deal. I want the food deal too. so what Mark was really good at doing which I need to start learning from is like he would just stand back and wait and wait and then he'd bounce last minute and sometimes Kevin did that to me like in my first show my first segment I think I was like negotiating and negotiating and negotiating and Kevin all of a sudden just undercut and he's like I'll do that I'm like wait what happened so it's funny and when you record Shark Tank for a few days after you're like driving you're oh i should have said this because there's so much going on at the moment how many deals really go through because i know there is a period of due diligence you only get a few minutes and you have to like verify everything yeah it ranges per season but i try to have more than 50 percent of them close sometimes i get 60 75 percent close my worst season it was like 30 percent but also it's not your side of it right like if i if an entrepreneur retrades and they want to change the terms of the deal, then I walk away. But I would hope that it's more than half close. I know you're so good at budgeting. You're like frugal mindset even to today. Do you have a sense of how much you want to invest going in? Or how do you think Shark Tank versus your private investment? The first season that I was on, and my kids and my wife make so much fun of me about this, I didn't know what I was doing. So I liked this hammock company and I offered a million dollars and my wife made me sleep outside that night and there was no hammock. But actually that hammock company, Yellowleaf, is doing really well now. They're selling tens of millions of dollars. And so it turned out to be a good investment. But I was of the mind that my most precious asset is my time. And so if I'm going to invest and I'm going to give my time, I need to get a big piece of the company and I need to invest big amounts. And it's kind of like when you play poker, they real good players They just play the long game The other sharks they know to be patient and not to put everything on one hand So I learned that in the latter seasons But I don't have an amount that I want to deploy. I probably should. I should have consulted with you. But I just go with what I see in the particular. Well, we've had, Kevin was just here. Kevin wasn't with you? We would love to do, which we've done with the other sharks that have been on the show a little lightning round. Sure. If you don't mind. Which shark would you want to be trapped on a desert island with? Probably Damon because he's the only person that I knew before Shark Tank. He's like a dear, dear friend of mine. But you don't need to procreate, right? Is it a deserted island that requires procreation? No, not required. I'll take Damon. Which shark would you start a business with? Honestly, any of them. I love him, but I think probably Mark. That guy is, first of all, he's so ridiculously bright. He processes so fast. He has so much integrity. Like, his word is his bond. I think he would elevate my game. Like, he stretches me. He challenges me. But I would partner with any of the Sharks. Which Shark is the best dressed? I used to say Damon, but I think Robert. He is so spiffy. I think Robert. Have you hired a stylist? I haven't hired a stylist, but as you can tell, I don't know how to dress. And I don't know if you can tell. This morning, I thought this was black and black. And then the light showed up. And oh, this is blue and looks horrible. Oh, I think that's in now. Navy and black. I wouldn't know. But Artemis, who's the wardrobe consultant on the show, is my godsend because she teaches me what to do. And then I borrow whatever she taught me for that season, for that year. And then the next year she teaches me what's new. Because what I don't like about you stylish people is that you change the rules every year. So if I start wearing this and then the next year is like this, the shoes or this or whatever. So Artemis is my secret weapon. Which shark is the most competitive? Everybody's very competitive. That's what's interesting at the show. And it really brings out that competitive. Like you do not want to lose a deal. And then afterwards you reset. But when somebody wins a deal over you or where you don't want to partner with them, whatever, all of us have our egos. And it really does. I think everyone is very competitive. I think Marcus probably with me was the most competitive because he admired me a lot, but he also regretted that he lost some food deals to me because Mark almost never lost deals. And you could tell that he does not. And he teased me sometimes. He would do some deals. What I like about Marcus, sometimes he would do the deals. if he felt that the entrepreneur was not getting the right deal, he'd jump in. And I think Mark is the most competitive, but every one of us is. But Shark makes you laugh the most. They all make me laugh. Oh, Kevin. Kevin, I laugh out loud with some of his stuff. Kevin, he's very funny. And I know some people think he's mean. He's more funny than mean. And also we're speaking earlier about telling it like it is the gift of feedback is very valuable so i like that i i don't like that sometimes he's such a tough cabroncito but he's so funny he's really he's very witty he's very fast who's the kindest shark kindest shark not counting me i think robert's a real gentle soul i think laurie is the nicest and the most nurturing but barbara is without any doubt of all of us in that panel the person that more surprises me at how deeply authentically kind she is all the time. She blows me away every time I see how she behaves towards everybody. But every shark I think is a kind shark. Even Kevin, who has a reputation for being a cabron, he's... Which means... I guess we can guess. What's interesting about Spanish is that there's a lot of words in Spanish that are bad words. But in Mexico, the bad words are sometimes good bad words. So cabron means like a mofo, jerk, but in a loving way. It's very hard to explain. But cabroncito is a devilish, mischievous motherfucker. So that's kind of, that's what a cabroncito. Do you want me to re-say it without the word? No, I like it. No, I agree. Barbara, I met her actually for the first time when she came on the show. And it was one of those examples where she debunked the idea of never meet your heroes. Like she was so wonderful and kind. Barbara is really, and she really wants to help others. But every one of the sharks in my experience is someone that I would want to be my friend. So you're signed up for a long time. Like you're on the show. I enjoy working with all the sharks a lot. The brother question depends on the powers that be and on a lot of other factors. But yeah, I think the format of the show, the show, the people that put it together, it reminds me a lot of the kind culture. The Shark Tank, everybody in the crew and in the production team are working towards a higher goal. They're all working towards each other. It's a very cool culture. I'm not used to too much Hollywood, but the way they put the show out is best in class in terms of culture. I love it. Well, maybe we can think about, we'll brainstorm on like your net worth, how much you should be investing so you don't have to sleep outside anymore. Just maybe have a budget. I thought you were going to say that you should come visit Shark Tank. I would love to. And I've talked to the producers before. They've asked me for recommendations all the time. That's useful too, but you should come watch it. My brain, I don't even know if I've recommended you in the past. I could also potentially shake credit for that. But it's an amazing dynamic that you guys have, and you're killing it. It's so fun to watch. I'd love to talk to you about the op-ed that you recently put out that I was very, very moved by, talking about your Jewish grandfather. As you know, I'm very, very proudly Jewish. Both my parents immigrated from Israel, so I'm first-generation American. I had forgotten that. But now you remember. And it was so moving to hear about your own anti-Semitic experience, someone you thought was a close friend of yours. Can you share that story? Yeah, I was at Stanford Law School, so this was 30 plus years ago. And one of my friends, he was kind of drunk, and he started throwing pennies at me and then said, Hey, Jew, you're a Jew, pick them up, pick them up. And it really broke my heart. And he was someone that I considered a dear friend. And I think he probably regretted it. Did you ever talk since then? We didn't. I don't recall. I probably, being who I am, I probably shared that I was hurt and I explained it to him. But we never were friends after that. And you talk about how saving money is misunderstood and what you learned from your grandfather. What I talk about, this is a Washington Post op-ed where I explained that my grandfather always taught us to not be arrogant about money. But he would emphasize not to be so arrogant that you think it's beneath you to pick up the pennies. And certainly from my experience building Kind, I was very proud to be resourceful. I mean, I would have not been able to build a multi-billion dollar company, create billions of dollars in shareholder value if I hadn't been comfortable picking up free furniture. Like when we were starting the company, did you ever watch Mad Max? Sometimes I feel like there were these people living in the subterranean thing would come out. There was a free desk that somebody left would grab the desk and bring it into our basement office. but we saved ourselves $500 and we operated out of the basement of our building instead of a fancy place and, and, and, and and there were so many ways in which we were initially frugal then resourceful but we didn't waste money and we stretched those dollars and we were able to create billions of dollars in value and still today it's not that I have to not throw out that avocado or that bread but I hate throwing food not just because there's people that are hungry, but because I was taught by my parents to not think that I'm above that. And it has nothing to do with being cheap or anything else or not being kind or giving because the opposite. I give tens of millions of dollars a year every single year in charity. And I am very generous when I have guests and I try to be lavish with my guests. I love giving. I just don't like throwing stuff out. I think it's dumb and stupid and the more that you avoid that. And also it's a skill for business people to teach and it's a skill to teach my kids. Like one of the conversations I tend to have with everybody because everybody does it wrong this way is like how many streaming accounts do you have? And we don't do it perfectly but we don't have an unlimited – we don't have like 20 streaming accounts. You can only watch one TV show at a time and each of them has an up-depth. So the ideal, you're like, who's this dude? I try to teach my kids. I give them a budget and they're like, make choices, learn. Because otherwise, when they go out into the world, they're going to not be well equipped to negotiate and to make choices. So, of course, we can afford to have five or ten streaming accounts. But choose the three or four that you like the most and then use them. And then if you ever need the other one, then choose which one you're no longer using. because you're not going to be watching 50 things at the same time. And again, that $10 does not make a difference. It doesn't register on my radar. That's not the purpose. It's a principle to learn how to, well, that's what your show is about, right? Teach people to make choices. Yeah. I mean, how you do one thing is how you do everything too. So extrapolate that to other things. It's crazy that you say that phrase that you learned growing up because every time still it's like embedded in me when I see a penny and like nobody uses pennies anymore. You know, I don't even have cash. But I will always have to pick up the penny because I was told like if you don't pick it up, you're not worth the penny. So I don't know. Maybe this is like a Jewish experience. It should be a human experience and certainly it's an American experience because what I talk about in that article, by the way, the pennies are now collector's items. So there's an additional reason to pick them up because they're being discontinued. But part of our founding father's ethos was Benjamin Franklin talked about a penny saved, a penny earned is a penny saved, a penny saved is a penny earned. And he talked about like our founding fathers talked about thrift as an essential tool for being entrepreneurial culture. And America is the most extraordinary country for entrepreneurialism. And it's partly because we're not so arrogant that from the dynastic, oh, la, la, aristocrats that say, oh, I'm beneath, you know, saving that dollar. I think we should do that. And then you can be charitable $1 and donate that dollar, but don't be so arrogant that you think it's beneath you for you to save that dollar. And we're entering a period of a lot of instability where a lot of young people have not been taught the importance and the gifts that we have of this free market system. And it's very imperfect, right? Like there's a lot of people that are suffering that don't have enough and we need to find a way to create a level playing field so that everybody can be elevated. but part of the toolkit to do so is to have agency, to not be a victim, to know that you're a protagonist, to have that kindness of spirit with that strength of purpose and to be comfortable taking decisions that are going to help you earn some money. And that is a fundamental tenet not just of our Jewish upbringing but of what made America such a fundamental success story and example for the world. And we should not lose that. It's really, really important that we retain that entrepreneurial resourceful spirit. Daniel, as you know, we end all of our episodes by asking our guests for one tip that listeners can take straight to the bank. What is one final tip about saving, investing, raising money? I think it's create a real or artificial sense of scarcity so you can make choices always. Even if you can afford it doesn't mean that you should do it. Even if you can get an extra house or an extra car or an extra streaming account, learn to make choices because the choice is not just about whether you can afford it. The choice is like whether it's going to make your life better. And Warren Buffett used to say that you don't own properties, properties own you. When I was building Kind, I didn't have – after I sold it, I didn't have a car. I didn't have a house. I was just focused on my business and I was renting and just being resourceful. and fortunately we now are able to have more but managing all of that you have takes time and i don't think i could have built kind you had to worry about all of the other stuff and so every decision you make about what you purchase might enslave you more than you realize so be thoughtful about every decision you're making and use the instrument to think not can Can I afford it? But is this something that's the right thing for me? And can I do without it? I think it's, and particularly if you're a parent that's successful when you're raising your kids, find a way for them to learn to make those choices.