School for Startups Minutes

This week, we are talking about some of the businesses that you know and love and the crazy twists and turns that got them to today. Today, I want to talk about McDonald's. The McDonald's brothers were restaurateurs. They believed in fast service, a simple menu, and tight operations, but they had no desire to grow or scale. They were happy with their one local business. I'll tell you what happened right after this.

A man named Ray Kroc saw something different. He wasn't interested in the hamburger. He was interested in the system, growing the system. McDonald's became a real estate and process company disguised as a restaurant brand. The lesson is powerful. Some entrepreneurs invent excellence. Others recognize it and scale it. Growth often comes from seeing leverage where others see comfort. I'm going to get some fries.

This week, we are talking about the crazy things that businesses did to stay alive. In the very beginning, Airbnb was failing. Investors passed, users were scarce, and they were running out of cash. They came up with a crazy idea to save the business. I'll tell you what it was right after this.

It was an election year, and one of the founders noticed that themed cereal boxes sold really well. So they designed political party cereal, sold it at a premium, and shipped it themselves. Of course, the cereal didn't scale. It wasn't the business. But it kept the company alive long enough for them to learn what customers actually wanted. The lesson matters. Sometimes the job of an early business is not growth, but survival. Now, with Airbnb in trouble again, it'll be interesting to see if they can survive now.

When Howard Schultz, the founder of Starbucks, visited Italy, he noticed something very different about their coffee shops. They weren't just places to buy drinks. They were gathering spots, social centers, parts of people's daily ritual. When he returned to the United States, people told him Americans would never act that way, especially about their coffee. Well, he showed them. We all know how it turned out. I'll tell you the trick, though, right after this

Starbucks didn't win because of their beans. It won because they sold a place to belong, and the lesson is very subtle. Many businesses think they sell products, but customers buy experiences. Entrepreneurs grow faster when they understand the emotional experience that their business is providing. And when you can tap into that and double down on it, you win big, just like Starbucks did.

This week, we are talking about crazy but true stories of American businesses. Today, we want to talk about Netflix. We all remember the old Netflix, mailing the DVDs in the red envelopes. They didn't do streaming. They had no algorithm. They had no content. It was just DVDs and postage, and it worked. But of course, streaming came along and disrupted it. I'll tell you what happened right after this.

When streaming became possible, Netflix didn't protect the old business. It willingly disrupted itself. DVDs funded the transition, then quietly faded away. The lesson is unforgettable. The most dangerous thing a business could do is defend what used to work. Letting go early is often the most disciplined decision a founder can make. And that's exactly what Netflix did. They ran from their existing model.

This week, I'm going to tell you stories about 5 businesses that you know and the incredible things that they overcame. I'm going to start with FedEx. Unbelievably. One Friday, they realized they didn't have enough gas for Monday. They couldn't afford to fly over the weekend and pay all of the gas bills on Monday. So, guess what the owner did? I'll tell you right after this.

Well, I'm certainly not going to recommend this as a good strategy. But in fact, what the owner of FedEx did was he went to Las Vegas with all of the remaining company cash. And he played blackjack for the entire weekend, and he won enough money to keep the planes flying. It bought time, and time led to more funding, and funding led to survival. The lesson is not about gambling, but it's about reality. Famous businesses survive crazy things.

We've been talking about pets all week, and I have been trying to make the argument that everyone needs at least one pet in their life. I will also tell you this. This is true. My pets have been named by PETA as the best-named pets in America. My last name is Beach, and so a lot of things go with that. You know, Sunny, Rocky, Sandy, Wavy, Clothing Optional, Black Sand, and of course, with Black Sand, you would abbreviate it. Anyway, that's true. I had a PETA official and vice president on my radio show, and they certified it. But pets are so important, and I'll give you the final reason why right after this.

Did you hear the passion in my voice when I was talking about my dogs and cats? I love Sonny, the dog, and will always love her. We need more love in our lives, and having a pet is a great way to do that. Just go get a dog and increase the amount of love you feel.

This week, I am talking about our beloved pets, our cats and dogs, and I am arguing that everyone should have some sort of pet in their life. Today, I'm going to argue, in particular, that every child needs a pet. I'll explain why right after this.

Our pets need us for so much. They need us for water, food, exercise, love, affection, and a safe place to cuddle up. It's almost the exact same as life. The people around us need exercise, food, love, and our affection, and we need to give more of that to our pets and to the people around us. It also reminds us of that in a good business. You must give the same thing. You must give affection to your business, establish rules, and be there every single day for it to succeed. And for a kid, there's no better way to learn responsibility than a pet.

This week, we are talking about pets, our beloved furry friends, and how they make us better. And I'm arguing, with 5 reasons, that everyone should have a pet. I've already talked about how they make you healthier and happier. I'll throw another reason we should all have a pet into the mix right after this.

Imagine you're in an elevator with 2 or 3 people. No one says anything, but put a dog in the middle of the same elevator, and everyone's going to talk. What's the dog's name? How old is he? Can I pet him? Oh, he sure is well-behaved. Dogs and pets are great social icebreakers. They allow you to interact with your building, your condo building, or maybe the other people who live on the same street in your neighborhood. Research has shown that the best way to build a community is to increase the number of pets.

It took me decades to become a pet lover. As a child, I did not enjoy pets. I had a bad experience, but when I got married, my new wife sent a puppy, a Dalmatian, that was moving in before she did. And it was absolutely a joy. I loved that dog, maybe more than the marriage. But anyway, this week, we're talking about how pets can make you better and how we should all have a pet. They certainly make us happier.

Pets make you healthier. You have to get up and take care of them, or they will leave special treats for you. I bet that, as an investment in your health, getting a pet is better than getting a gym membership. So many people quit the gym membership, but the pet still needs to be taken care of.

This week, we're going to take a break from business and entrepreneurship and talk about pets instead. I want you to know that I had a horrible, in fact, the worst story ever, a horrible pet incident as a child. I am not going to tell that story to you, I promise. But it made me swear off dogs and pets for a long, long time, decades. But now I realize that having a pet is one of the best things you can do. And this week, I want to give you 5 reasons you should have a pet. I'll start right after this.

Pets make you happier. Tons of scientific data this. There is absolutely no doubt. And I can personally affirm that dogs and cats are happy to see you and make you happier at the end of the day. Even cats will give you affection. You know, it's going to take a while, but it will happen. And there's nothing better when you've had a bad day than a dog.