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[MUSIC] Andy, welcome back to the GSB. >> Thanks for having me.
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>> It is such an honor, to be sharing the stage with you.
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Your story of founding Bonobos, from launching the company here at the GSB in 2007, to selling it ten years later for $310 million, is truly inspiring.
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I'm so excited to dive into all of this today.
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But before we begin, I wanted to introduce Bonobos to those of you who may not be as familiar with the product.
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So, in a view from the top first, let the fashion show begin.
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>> [APPLAUSE] >> [LAUGH] [MUSIC] >> On your left, you have Justin in Italian stretch chinos.
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On your right, John Henry Styles in original stretch washed chinos.
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[MUSIC] >> [APPLAUSE] >> On your left, we have Diego Ramirez in original stretch washed chinos.
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On your right, James Underwood in stretch washed chino 2. 0. >> My God.
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[MUSIC] >> [APPLAUSE] >> On your left, we have Asha Rod Gupta in yarn dye stretch chinos, and Mike Peng in flint straight chinos. >> Amazing.
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>> [APPLAUSE] [MUSIC] >> On your left, we have Olamide Olaniyan, on your right Jonathan Wakins, in original stretch washed chinos.
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>> [APPLAUSE] [MUSIC] >> On your left, Sunny Stevens in the stretch weekday worrior dress pants.
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And Logan Randolph with the Bonobos light washed jeans.
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>> [LAUGH] [MUSIC] >> [APPLAUSE] >> Last but not least on your, left John Gilhuly in stretch weekday warriors, and Joe Bateman with the stretch washed Chino 2.
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0 >> [APPLAUSE] >> [LAUGH] >> Please give a big hand for our models.
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>> [APPLAUSE] >> Amazing.
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>> I'm sure you've seen, and been a part of quite a few fashion shows how- >> Not like that. Not like that. >> Me either.
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Well, Andy, many people know you for the pants that we just saw, and if they didn't before, they do now.
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But not many people know about what you refer to as your ghost story.
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I'd like to read a powerful excerpt from your book Burn Rate, if that's okay with you. >> That sounds good.
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>> Okay, [LAUGH] thank you.
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In 2016, on the precipice of selling Bonobos, the startup I'd been building for the previous nine years.
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I flew into a manic spiral, and was hospitalized for a week, in the psych ward at Bellevue in New York.
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When I was discharged, I was met by NYPD officers, who took me to jail, where I was charged with felony, and misdemeanor assault. >> Good cliffhanger. >> [LAUGH] Thank you.
3:30
Not many successful business leaders talk about their struggle with mental health.
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So, first of all, thank you for being so open, and doing so.
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We'll spend a good portion of the interview later discussing this.
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But every story has a beginning, so, let's start with yours. >> Yeah, sounds good.
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>> You grew up in the Midwest, the son of a US History teacher, and an ultrasound tech.
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Tell us a bit more about your upbringing, and how it influenced you.
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>> Yeah, well, it's funny because the editor, and my agent, basically said, we need a chapter at the beginning of your book about your upbringing.
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And my initial reaction was, there's nothing interesting about my upbringing.
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I hadn't really thought of anything, that unique about it.
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And then as I got to work on that, I was like, there's some stuff here.
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My mom's a Indian immigrant, born in a refugee town, all the way from Rawalpindi, Pakistan, to New Delhi, India, at the time of the partition.
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Somewhere between one and two million were killed, at a time when 14 million people were displaced.
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So, her origin story is in the midst of that strife.
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Settled in New Delhi, came to the US when she was 20.
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Her father grew ill from emphysema.
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He was the only one who was a financial means.
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So, it was financially extremely stressful, and her mother was a child bride.
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So, promised to be married at about 10 or 11, married by 12 or 13, two miscarriages as a teenager, then two children who died in infancy.
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And then seven children, the middle of him was my mom.
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And my mom's oldest sister, my mossy, delivered me, she became an OBGYN.
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And so, if you ever had this dynamic in your family where you have an aunt who can say to you, I put you in this world, I can take you out of it.
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>> [LAUGH] >> Being sassy.
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So, that was a bit on my mom's family.
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And my dad's family were kind of classic Scandinavian Midwesterners.
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So, Danish, Swedish, Norwegian, all of that.
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And so, I grew up in a biracial household.
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And I think, maybe the most interesting part of that in retrospect for me is how different the cultures were around communication.
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And so, in my dad's family, you don't talk about small conflicts, those bubble up and become big conflicts.
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And so, eventually, you don't speak at all.
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Very tragically he doesn't speak to either of his living siblings.
5:56
On my mom's side of the family, you say exactly what you think, to everyone except the person that you're thinking about.
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>> [LAUGH] >> So, all the information gets around, but with no conflict.
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My mom's a little different with us.
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And fast forward to later, now I'm married to a Brazilian Jew, who's a descendant of the Brazilian, and New York City Jews.
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And you say exactly what you think, in real time to everyone, except to the person that you thinking about.
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Such that the first time I had dinner with my now wife, and mother-in-law, either my Scandinavian side, or my Indian side was in the bathroom dry heaving.
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And being like, I can't be a part of this family.
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But in truth was that might have been a family coming together, versus falling apart.
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So, this is somewhat, some of the origin story for my family.
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And I think the other piece of it is my sister.
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I have an incredibly loving older sister.
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In Hindi, we call her Didi.
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We have a business together now, which actually is a really bad idea.
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We'll talk about friendship and business, and family and business.
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In truth, it's brought us much closer together, because we have more time to spend, but it also it's challenging.
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Family and business is challenging, just as friendship and business is challenging.
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>> Well, Andy, we have something in common.
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My mom also tells me that she brought me into this world, and she can take me out.
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So, I've heard that as well.
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But you grew up in the Midwest, and you ended up leaving and coming to the GSB.
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Here in 2005 is where the idea for Bonobos was born. >> Yeah.
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>> Your roommate in Schwab, Brian Spaly, ended up becoming your co-founder. >> Yeah.
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>> Take us back to those early days of Bonobos on campus. >> Yeah. >> And why men's pants?
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>> Yeah, so, it was inverted, actually.
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Brian was the founder of Bonobos, and I became his co-founder.
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And the way that it went down is this.
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Brian came in, and felt like there's this one problem that he had which is his pants didn't fit.
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And so he did one of these projects, I can't remember what they're called, G 300.
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He used to be call them the 300 project.
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And he went out, and he got this survey with all of our classmates.
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And the basic insights were Guys wear jeans because khaki pants and wool pants don't fit that well.
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So that was like insight number one.
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And insight number two was, guys don't like shopping in stores.
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And then insight number three was that J Crew and Banana Republic were the two main places.
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So his view about men's pants was very specific, which is that if the pants fit around your thighs and your butt, they were probably too tight in the waist.
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So that when you sat down, you were really uncomfortable back in an era where you had to wear pants to work, right?
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And so then as soon as you got home, you threw your jeans on, and your weekend going out was denim.
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And the thing that happened in premium denim in the 90s was there was stretch that was added to the fabric, which had never happened before.
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So, step one was Brian added stretch to khaki pants and wool pants, which was not a massive thing at the time.
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The other insight that Brian had was that pants are kind of boring.
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And so he developed this contrast liner that would peek through the back pockets.
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They would kind of create a conversation, they called it conversational prints in a very specific place, and he started just selling pants to our classmates.
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So he found a factory in San Francisco and he found a pattern maker in San Francisco, part of the last dying vestige of the fashion industry here.
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And he brought pants that he had worn where he would buy like a size 34 that fit his thighs and then tailor it into a 32, which is a $80 alteration, probably that no one here has ever done, because you have Bonobos, right?
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And Bonobos pants are made with that contour, like curved waistband.
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So then he drove to LA, he bought a bunch of fabric, he picked a really cool pinwale corduroy, really thin, really lightweight, it had great stretch.
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Which is kind of perfect for Northern California because it's cool in the morning and then it kind of heats up during the day.
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And he just started selling them to our classmates for $100.
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And it was like, well, one person was wearing them, then five and then at some point, half of our classmates were buying pants.
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We did a pants party at our house, I don't know if anyone has his house on El Camino Real, used to call the white house, anyone live there?
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>> It's still around today.
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>> It's still around, yeah.
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So Brain tried to rebrand it to Pleasure Town which didn't [INAUDIBLE], but then it went back to the white house.
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Brian is an eccentric character and hopefully many of you will meet him in MGE or have met him.
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And we had a pants party where people were playing whatever games and long games, and we sold $16,000 of pants that day.
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And so if you ever have a product where you sell that much and it's a legal product.
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>> [LAUGH] >> You might be on to something.
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>> And you definitely were, that is incredible to sell $16,000 worth of pants in one day.
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After the GSB, you decide to work on Bonobo's full time, while Brian decides to take a job in PE and work on Bonobos on nights and weekends.
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What gave you that conviction?
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I know so many of us entrepreneurs and aspiring entrepreneurs are wondering whether or not we should take that leap of faith.
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>> I went on a GSB service trip to East Africa and it was like 12 or 13, do you have these service learning trips still?
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And we did a homestay for two nights, and I lived with a guy named Stanley and his wife and two kids.
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And it was a clay brick house without running water.
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They prepared a wonderful meal, of course, and then there was a big bucket, where you dump it over your head.
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And generally it's cold water, which is like the ice bucket challenge.
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And of course, they found a way to heat it, which was wonderful and it's also like an outhouse where you shower or close by.
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And then I came back to the white house, the one here in El Camino Real.
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And my bathroom you had to walk outside to get to, and it had two showerheads, which is plush, and I turned them on and the hot water hit me.
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And I had this moment where I was like, we do not actually take that much risk.
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The way that we define it in the US for people in the cohort in this room, it's actually not risky to start a company.
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It's an insult to people whose lives are actually risky to think of it as risk in similar terms, and I don't mean that in a judgmental way.
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Many of us have reasons, there are medical cost reasons and children, and there are things to be thoughtful of, but in terms of having our future net present value is in pretty good shape.
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And so if you redefine the risk of not doing something that you love, and that I think is a spiritual risk rather than a financial risk.
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And so that trip really changed me.
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And I felt like okay, even though I have $3,000 in the bank and 182,000 of debt, maybe a third of which was elective, just having fun and traveling.
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I'm probably not going to starve one day.
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And with that perspective, I was like, okay, then what can we go do?
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And I had no good idea of my own, so I thought, okay, I'll just steal Brian's idea.
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>> [LAUGH] Worked out well.
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That is a helpful way of reframe around risk and that reframe allowed you to take the leap of faith to move to New York, and to work on Bonobos.
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At the time, you were truly a pioneer building a direct consumer digitally native brand.
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Just to take everyone back to 2007, Amazon was irrelevant in fashion.
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People thought e-commerce was going to be an afterthought.
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And if you were a fashion brand not selling through the likes of Barneys and Bloomingdale's, you were doomed to fail.
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So Andy, how did you have this aha moment to build a digitally native brand and how did you convince others?
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>> Well, first, and what is it?
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Great entrepreneurs are just thieves.
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And then second, the future is here, it's just not evenly distributed.
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So if you want to build the future, don't look to the future, look to something that's in the corner in the present.
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And then kind of past is prologue, which is that more or less we're the same species last 200,000 years.
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So there's probably something in history that might alert you to what was coming.
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For that third thing for me it was that I'd worked at Land's End as a second year being in AC.
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Has anyone spent a couple of winters in Dodgeville, Wisconsin?
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It's cold, there's not a lot to do other than just work.
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And I got to see this storied catalog retailer that didn't have stores.
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And I remember one day touring the call center and seeing all the notes from customers that had been mailed in.
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And there was a note from a woman that said, dear Elizabeth, thank you so much for calling me to wake me up the morning of my wedding.
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My mom was a mess, my bridesmaids were on the sleep end.
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You're the best, Carolyn.
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And I was like, the paradox of retail is that by not having brick and mortar stores and going direct, and this was the catalog innovation, you can actually build a better customer service relationship.
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And then in terms of what was happening in the present that was in the corner, there was this company called Zappos.
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And an entrepreneur named Tony Shea and backed by Sequoia.
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And it was like, you know startups how there's little rumors, you don't know exactly what's going on, you see that they exist.
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And they were selling shoes.
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And everyone at the time, this was a time where e-commerce people were selling cars on eBay Motors.
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But it was like, well, you're never going to sell shoes because you gotta try them on.
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Wait, don't you have to drive the car?
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But Tony had free returns both ways, 365 day return policy, and a really spirited service team who were core to the company culture, right?
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And that's obviously what Delivering Happiness is about the book, and the irony of that title relative to Tony's fate, well, I guess we'll get to that type of conversation later.
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So I was like, well, if you can sell an existing soft goods product footwear, then presumably you can sell an existing soft goods product clothing, and why can't you build your own brand, right?
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And then I kind of looked at the history of the Gap which used to sell Levi's jeans and records.
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And then an entrepreneur named Mickey Drexler came in and said, well, the margins on Levi's jeans are here, why don't we make Gap jeans?
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We would get another 20% margins.
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Well so, for you're a retailer with stores you're not a brand.
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But he said no, let's vertically integrate that.
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And now everything from you pick it, right?
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From IKEA to Zara, it's all vertical now because of that margin trade.
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So I took those three ideas and put them together, and then I went out to pitch people on the concept, and everyone said no.
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And that made me really feisty.
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>> [LAUGH] >> And also as a part of innovation which is that it's gotta be contrarian at the time.
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>> Well, you were really onto something and building this direct to consumer brand.
17:49
On the surface it seems like things are going well, this is 2007, 2008.
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But internally, if you look under the hood of Bonobos, you were dealing with quite a bit of friction with your co-founder, Brian Staley, as you've alluded to.
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So can you take us back to that time in the life of Bonobos and what happened there?
18:06
>> Well, I blamed everything on him.
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>> [LAUGH] >> Right, it's easy in life, I think to see someone else as the problem in your life story.
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And then if you get to my age or beyond, 43 now, it's some point, hopefully, you realize that you are the problem in your life story.
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And it's a little bit debilitating to take that on, but it's also very freeing because then you don't have to stand in judgment of others in the same way.
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And you also have agency to fix it, if you don't need someone else to change.
18:39
But in 2008 and 9, I was 28, 29 years old, and I had these issues with conflict that I described.
18:47
I wasn't able to verbalize conflict and have really difficult conversations with Brian because he was my friend.
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And now there's this whole school of radical candor that talks about, if you're high on caring but low on conflict, you're in a bucket that they call ruinous empathy.
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I was like, that's me, I'm the ruinous empathy person.
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And the problem with ruinous empathy is, in theory, you care about other people, but you care about them so much that you never actually tell them the truth, right?
19:17
Which is not that caring.
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And so we ended up in a place where my anger was building and building towards Brian for perceived slights.
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My stresses at the company as we hired more people and raise more money we're going up, and I remember having a call with one of the professors at the GSB.
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The only reason Bonobos exists outside of Brian's innovation, from a financial standpoint, is that two professors back the company, Joe Peterson and Andy Ratcliffe.
19:49
And I called Andy one day and I sent him our P&L.
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And I was like, Brian is got, we have a major inventory problem.
19:57
We designed this swimsuits thing, it's not working, and Andy literally on the call was like, no, the problem on your PL is your OpEx.
20:05
It's your operating expenses, which is actually what Brian was, I felt criticizing me for, but it wasn't necessarily criticism it was challenge, because he's like we're hiring too many people.
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And I was convinced that we had to bring on a great VP of engineering from Zappos, and we had to build this tech company.
20:23
And Brian was, it's kind of a pants company, and I was like, well, it's a tech company that sells pants >> [LAUGH] >> And so we had all these vectors of conflict, but we were unable to resolve it, I think in retrospect, due to my limitations.
20:40
And Brian's not perfect of course, but in our relationship the friendship was ultimately sublimated to the business discussion, which is the business conversations, which is also common.
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So I woke up at some point dealing with a lot of depression. I really disliked Brian.
20:59
I wasn't so happy with myself and that led to a co-founder divorce that happened two years after the company's formation.
21:07
>> Yeah, given the conflict you described and that leading to the co-founder split, is there any advice you would give to GSB students in terms of thinking through how not only to select a co-founder, but also safeguards to put in place in the case of co-founder divorce?
21:21
>> Yeah, so I think when it comes to selecting GSB co-founders, don't.
21:25
>> [LAUGH] >> But if you insist, and I do think there's something to be explored, which is, that the right co-founder for your company might be at Stanford but might not be a GSB student, someone from another school who brings an entirely complementary skill set.
21:45
In very likely you're going to be the CEO of that company which is cool because CEO is a fun job, and you won't have the same kind of complimentary skill sets.
21:55
If you do exist on founding a company with a Stanford, GSB classmate, and I wouldn't do it, I wouldn't do life any other way.
22:07
There was no way for me to access what became my life without partnering with Brian, because he was the product innovator and the product genius.
22:16
It's worth really thinking about what you're going to do differently.
22:20
Not at time zero, because that's pretty straightforward, but like four years later, right?
22:25
So once the company has 40 people, how's it going to work?
22:29
Because when everyone's in a room, it's kind of okay if you have two people running the company, but once you have 40 people, it's extremely difficult, the co-CEO thing.
22:40
I love Ben Horowitz's comment on co-CEOs when he meets them, which is let me get this straight.
22:46
It's more important to optimize for your egos than it is for having a clear decision maker at the company, and it's a tough one to respond to.
22:55
Some people do pull it off, friends of mine, Dave and Neil at Warby Parker have, it's remarkable.
23:02
But I would hope that someone at the GSB will write a case about how they did it, because it's so rare.
23:09
And it's so much more often the case that there is someone that leaves before the other person, and that that leaving has acrimony attached to it.
23:19
And I would love to teach a case on class on co-founder divorce, because there's a bunch from the GSB, the founders of StubHub didn't speak for a decade.
23:27
There were founders from my class who had Adventure Together, who were married and literally got divorced.
23:33
So I think it's important to, if you're going to do it, recognize that you are putting the friendship to rest.
23:42
The friendship ends the day that you go into business together, because the partnership eclipses it.
23:50
>> Those are good considerations and great advice.
23:53
Also I'm sure we would love to have you and come back to the GSP and teach that class.
23:58
Brian Spaly does end up going to sell Trunk Club to Nordstrom, so he does have a successful exit of his own.
24:05
But, Andy, now it's 2009, you're alone at the helm of Bonobos as the sole remaining co-founder and CEO.
24:14
Over the course of the next eight or nine years you are constantly innovating and trying to figure out how to grow the brand.
24:20
Whether that's introducing new product categories, figuring out if you should utilize e-commerce in different ways.
24:26
And then continually innovating, you end up actually, revolutionizing the brick and mortar shopping experience with Bonobos guide shops.
24:34
So can you tell us a bit about how you were able to innovate and constantly see gaps that others couldn't at the time?
24:40
>> Yeah, I love startups because they're a collision of fantasy and reality.
24:48
And there's many genres of human work where you develop ideas and you get to get really passionate about those ideas.
24:57
There are a few where those ideas are tested and really have interrogated and evaluated on a sub five year timeframe.
25:07
And one of the most humbling things about being an entrepreneur is that you certainly have enough vision at the beginning to start something, if it exists, you have done that.
25:18
But the false conclusion that you might reach is that you're going to be able to do that again and again.
25:24
And so you might convince yourself that you're really good at vision.
25:30
And the truth might be that you were really good at the beginning.
25:35
And so what I learned was the innovations that were the most profound were not ones that I envisioned, but ones that I noticed.
25:44
And so ust to talk about the stories, we had two fitting rooms that we fabricated in New Jersey, that were ostensibly to take around and do different pants parties.
25:54
And one night we rented out a bar and we invited our best customers and it took 18 people on our team to move these fitting rooms.
26:04
And it was a massive effort and we had a bar tab and everyone drank a lot and we sold like eight pairs of pants.
26:11
So I was like, well, that wasn't great.
26:12
The traveling fitting rooms concept is not going to be our next thing.
26:16
And so they sat in our lobby collecting dust.
26:19
And then when we were moving from product one to product two, from pants to button down shirts.
26:25
Thinking about how to eliminate some of the we called it billowing muffin top of the shirt, which you saw none of the gentlemen who walked out.
26:33
[LAUGH] It was a very tailored look.
26:37
We wanted customers to come in and try it on.
26:39
And so we called it the dress shirt alpha.
26:41
We put it out on Twitter and Facebook, was not reviled company at the time.
26:46
And people came in and they tried it on and they were like, your dress shirts suck, but can we buy some pants?
26:54
And we're like, well we don't sell any pants here.
26:57
And it turned into this thing of well can we just try ons and pants.
27:00
And so we had a fit run and navy of every size.
27:04
And then they would say, can we see the other colors?
27:06
And they started transacting and it would be like, can we buy some?
27:09
And it was like, well, we can just do an e-commerce transaction in person.
27:12
And so at the time we were about a $10 million business and we started doing a million of sales out of our lobby unintentionally.
27:22
And I remember we had recruited a merchant from J Crew.
27:25
Because after Brian left I had to quickly fill the Brian sized hole at the company, which was merchandising, design, sourcing, and production, supply chain.
27:34
The creative eye was hard.
27:35
That was the hardest part about that year.
27:38
And our VP of merchandising, a guy named Brad Andrews, who's now up at Nike, remarkable person, was I kind of like what's going on inside this little part of our lobby.
27:47
And so then we said why don't we try to experiment with putting that at street level?
27:51
And the unit economics were really interesting because we didn't have to stock the store and having sold watches at Marshall Fields growing up.
28:00
And worked at Abercrombie and Fitch on the night shift this was 20 years before the documentary, so don't judge me.
28:07
But Abercrombie and Fitch sweaters when I was at Northwestern were the rage and they cost $72, I still remember this, which I couldn't afford.
28:14
So I was like I will go fold sweaters at night, so I can pretend I'm rich like my classmates at Northwestern. Very sad.
28:22
And folding sweaters on the night shift kind of sucks, right?
28:25
Sweater after sweater, there's like the board you put in.
28:28
And I remember thinking if we could build a store where no one's doing that, what could we put in instead of the inventory management.
28:35
We can put in one to one service, which we turned into calling it the guides.
28:39
And we opened 30 great stores, and then we opened 30 stores where we spent too much money and didn't need incremental doors in the markets.
28:47
But that was the second innovation in the history of the company after the selling pants online innovation.
28:56
>> Well these innovations helped you grow up a novice to a company that was doing over $100 million in revenue, its 2016 the world's largest company comes knocking on your door. >> Yeah.
29:07
>> And they end up acquiring bonobos for $310 million.
29:11
Many people saw these headlines and were wondering how this acquisition might affect the Bonobos brand.
29:17
So can you tell us a bit about why an acquisition and an acquisition by Walmart was the right path for Bonobos?
29:23
>> Yeah, so we were right on the cusp of doing a deal with a private equity fund.
29:29
That's really good and consumer and there's two of those globally.
29:35
And that was a joke, guys.
29:37
>> [LAUGH] >> But it's hard when you start a company, it's hard to identify private equity investors who you want to work for.
29:44
It's a big change and so we figured out a way to barely work for them, which is they were going to buy a 40% stake in the company.
29:53
We were going to maintain the majority as existing investors, and they made a really good offer.
29:59
And I went out to dinner at a restaurant called Auto with my CFO and our general counsel, the founder of the firm and the partner that worked on it.
30:07
And they gave me the term sheet at dinner, and I walked home, which was a few blocks to where Manuel and I shared an apartment on Ninth Street.
30:14
They'd given a bottle of wine as a gift and I was fumbling with the keys because I was about to show my wife a $300 million offer.
30:21
And as I was fumbling I dropped the offer and the bottle of wine at the same time.
30:27
And there was this guy named Newton who said that two things will drop at the same rate regardless of size and so the bottle of wine exploded on the offer.
30:39
And so I walked in with an offer that was dripping red.
30:42
And I was like, Manuel, I've got the blood money.
30:45
>> [LAUGH] >> We're selling out.
30:50
And during that process and in truth I really did like these people and I felt like they got it.
30:57
They had this thing they needed to do, which is they needed to put their capital ahead of everyone else's in the preference stack.
31:05
And I was like, you guys just got to the party.
31:08
Why are you in the first in line?
31:10
And so we were messing around for weeks and weeks and then I heard from someone hey, you should talk to Mark Laurie.
31:16
Mark had founded diapers.
31:16
com and sold it to Amazon, then he founded something called jet and it was wild.
31:21
He came out of Amazon and was like, we're going to beat Amazon.
31:25
And the rumor was that he was burning 20 million a month in cash.
31:30
And then he sold the company to Walmart for 3 billion which was the only buyer on planet earth. So who does that?.
31:37
And I walked into meet Mark in Hoboken and he was wearing a Vineyard Vines shirt.
31:42
And I was like, I didn't walk in here in an f'ing Amazon t-shirt.
31:46
He didn't care that much about the meeting, but then we sat down and we mind melded on this concept that the future of commerce might look a little bit like the history of video.
31:56
Which is that initially the big platforms were streaming other people's movies and shows, and eventually that was a race to the bottom on price, and so they would need to develop their own. Content to win.
32:07
And when Netflix launched House of Cards and Orange is the New Black, if you go back and look at it, their share price took a hit because Wall Street was like, what are you trying to do to, become HBO?
32:17
And in fact, that turned out to be an astute move.
32:20
So Mark and I that I would come in and run this new digital private brand group at Walmart.
32:26
And he said you gotta meet Doug.
32:28
And I went down to Soho one night and met this Doug McMillon, unassuming guy, for dinner with Mark, and he, how do I put it?
32:39
I came out of the dinner being like, it would be a privilege to work for this individual.
32:44
I fell in professional love, and I'm still in professional love with Doug McMillon.
32:48
He's the best leader I've ever seen in action, and we should get him up in this chair at some point.
32:54
And I was like, wow, it would be really cool to see this Walmart-Amazon battle play out with not a front row seat, but a second or third row seat.
33:02
>> Well, it's quite impressive that you became a part of the digital transformation of the Fortune one company.
33:08
And this obviously was such a big milestone in the life of bonobos.
33:12
And all throughout you growing and scaling the company, you internally are dealing with so much.
33:18
So I want to pivot now and talk a bit about your bipolar disorder diagnosis.
33:23
Tell us more about not only the diagnosis in college, but also your initial reaction.
33:28
>> Yeah, so I was diagnosed when I was a senior in college.
33:32
I had a few weeks where I kind of took my partying to the next level.
33:37
I was already drinking a lot, smoking a little bit pot.
33:40
But I moved into a bit of ecstasy and I had my first experience with psilocybin mushrooms, which for me, luckily was the last.
33:49
A few weeks later, it was the turn of the millennium, so it was 1999 to 2000.
33:55
And it was a very exciting time, because there was this Y2K narrative about how the digital world was going to melt down.
34:02
And then there was this like, what does the new millennium mean?
34:05
And so as I was using substances, and had really fallen in love in a really meaningful way for the first time in my life.
34:12
I was watching one night a special on people who thought that this was going to be the end of the world, or that the Messiah was going to arrive.
34:22
And as my mood escalated, at some point, I realized I was arriving.
34:28
I thought that I was the second coming.
34:30
And part of what is so humiliating about mania is that we have these messianic grandiose delusions.
34:39
And when you come out of it, you're like everyone now knows that I have this underlying God complex.
34:44
And so it took multiple years later of therapy for my psychiatrist, who I affectionately refer to in the book as Dr.
34:51
Z, to make me aware that everyone actually has a God complex.
34:55
And the God complex begins in infancy, because when you scream, you get milk, and when you cry, you get comforted.
35:04
This is for the vast majority of infants, not everyone, sadly.
35:09
And so we begin our lives as all powerful beings, and then we slowly part with that reality year by year.
35:17
At the same time as Disney and Harry Potter incept us with the possibility that we may be orphans who turned out to have superpowers.
35:26
Which is to say that our popular culture is built around the struggling childhood to superpower thing.
35:35
And so most of us discard the idea that we have superpowers, should they ever come up.
35:42
When you're psychotic, and one of the things that might help you understand a person in psychosis, is that you don't have the ability to disregard that thought.
35:51
The irrational thoughts that you might have at any point in the day, the plane hit some turbulence, we're all going to die, right?
35:58
Or that deer, maybe that's my daughter who passed on, like the movie with Frances McDormand.
36:06
Those kinds of thoughts are fantastical, and they're not discarded by a psychotic person.
36:11
And so I spent a week as Jesus 2. 0, and it was amazing.
36:15
>> [LAUGH] >> It was amazing.
36:19
Being the Messiah when manic is so fun, if you actually believe that's true.
36:25
And then it turns out that you're actually the biggest liability on the planet for everyone around you. So I stopped eating.
36:33
I stopped drinking anything, including water.
36:37
I stayed up for, we think, four nights in a row.
36:40
And somehow through, my friends figuring it out, calling my parents, my parents bringing me home, me lecturing my dad on all kinds of stuff.
36:51
My whole theory was that I was the Messiah and my message, and some of you may like this message, is that God is actually a woman.
36:56
>> [LAUGH] >> It's like why did men get all this credit throughout history when women make life.
37:04
And so I was yelling at my dad about this, and I was like, all your heroes are white guys.
37:10
And my dad was a master, he just went full Socrates on me, and was like mm-hm, mm-hm.
37:16
And then they called over my aunt, the one who delivered me, and my uncle who are both physicians, and they sat on either side of me in the back of a car and took me to hospital.
37:26
And that happened to be a hospital where I had worked growing up and the hospital where my mom worked, which just compounded the humiliation afterwards.
37:35
And so when the diagnosing physician said, you have bipolar disorder type 1, I remember thinking, no, I don't, like, what is that?
37:44
Two weeks ago, I was having fun with my friends, I don't even know what that means.
37:48
And then I went home and I did some learning and found out that the suicide attempt rate is 60%, and the suicide rate is 20%.
37:56
So when you're 20, and you're like, well, there's statistically a 1 in 5 chance I'm going to end my own life.
38:02
And by the way, this whole mania thing can come back at any point, could be two weeks or ten years, and you might do anything in that state, like cut off your ear.
38:11
It's very hard to take that diagnosis on as a 20-year-old, and it's most frequently diagnosed between 18 and 25.
38:18
And so back to the family norms of communication, very different families, but one thing that cultures did have in common was an abject desire to not speak about mental health.
38:28
And so my diagnosis became a little bit like fight club, which is, we don't talk about fight club, right?
38:35
We just buried it, and my friends buried it too.
38:38
And so I internalized that as an unspeakable shame, right, because what is shame, but what is unspeakable?
38:45
And the amazing thing about the human mind is you can actually bury this trauma yourself.
38:50
So I became unaware that these events had transpired, and then in occasion would remember this thing that happened to me in college. I wasn't even aware.
39:00
And then I would remember and have this rising panic and fear.
39:04
Wait, what does that mean, is that true?
39:06
And then push it back down.
39:07
And I lived that way for 16 years.
39:11
And I lived asymptomatic for the first eight, which lulled us collectively as a family into a feeling that perhaps it had been an inaccurate diagnosis.
39:22
And then in bonobos years, depression kicked in, and ultimately it came raging back.
39:28
>> Wo, and you mentioned it came raging back.
39:30
Can you tell us a bit about the episode that I described at the beginning of the interview, where you find yourself in Bellevue for a week?
39:36
>> Yeah, so one of the most pernicious things about mania is that it can be triggered by positive life events, having a child, getting married, let's say selling your company.
39:46
In my case, it was falling in love with Manuela and coming to the decision that I was going to ask her to marry me.
39:53
And I did it in a very romantic way, when while manic, I showed her a picture of the ring, which is a great reveal, right?
40:00
I was so excited during that time in my life that I kind of replicated the going off the rails of Going out a lot, drinking a lot, not sleeping much.
40:11
Sleep quality is poor if you're drinking a lot.
40:13
She left, she was working and spending time in Beijing at that moment.
40:18
And while she was out I was just going off the rails, burning the candle at both ends, which wasn't terribly uncommon for me but it was more acute.
40:28
And when she came back, I was off.
40:31
But she wasn't quite sure how to process it because while I had told her that I'd had this incident in college, I told her what also was true, which was that bipolar disorder is a differential diagnosis, and people aren't always definitely sure that that's what it is.
40:51
It's both over-diagnosed and under-diagnosed.
40:54
And I had gone to a few mental health professionals in New York when I was dealing with acute depression.
41:00
And most people were like, the company that you're running, that's a really stressful thing, and you don't strike me as having this illness.
41:09
And so I had a few people who kind of dismissed it.
41:13
So she wasn't really prepared, and it got bad that night.
41:17
I was laying in bed, I was howling at the moon.
41:20
I was playing Tupac really loud, and music sounded so good.
41:26
And she didn't know what to do, so she called her mom, her mom came over.
41:30
Her mom lived in New York.
41:32
And they were trying to kind of comfort me and manage the situation.
41:36
And I got up with a start to go to the bathroom.
41:39
And we lived in a little garden apartment where there was kind of a low ceiling and I hit my head on the ceiling and cracked open and was bleeding, and it hurt really bad.
41:49
Plus with the mania, you feel more acutely.
41:53
And we'd had this fight with our landlord.
41:56
And there was a heating grate that had rats that could come out of it, and I hated our landlord.
42:05
And so I did something I had wanted to do for a long time which is I rip the grade off and threw it.
42:10
And then I punched a large glass window pane and opened up both of my knuckles here, and I can still see the scars as kind of I take it as a healthy reminder of what's possible.
42:27
And then Manuela came to help me, and I remember seeing the fear in her eyes.
42:34
And my immediate thought was this is sort of weird, but I thought she was the alien from Ex Machina because she kind of is stunningly beautiful, and smart, and a little bit robotics sometimes with her intelligence and logic, and so I struck her.
42:52
And then her mom came out.
42:54
And the felony charge was that I pushed her mom to the ground and I kicked her.
42:59
And they were extremely brave.
43:02
Manuela got her mom to the bathroom, her mom called 911.
43:07
Eight New York police officers showed up within about two minutes.
43:12
They pinned me to the ground, cuffed me, and took me to the psychiatric emergency room at Bellevue, where I spent a week unaware of what had happened.
43:22
And as I came down from it, Manuela came to visit every day which was incredible, I noticed that she had a black eye.
43:31
And it was about day five or six and I just said did I hit you?
43:35
And she said you're kind of a wuss and it didn't hurt.
43:40
>> [LAUGH] >> And then it was a noose to the sky of shame to know that that had happened.
43:48
>> Wow, after that episode, how did you think about your bipolar disorder diagnosis, and what do you do today to help to keep it under control of it?
43:57
>> Yeah, so coming out of the hospital, walking into handcuffs, the next six months were like a hell escape.
44:07
And it was, was Manuela going to leave me, was I going to have to step down from my job, was there going to be PR about it?
44:16
I remember being in the Fourth Precinct in New York.
44:20
A place I never thought I'd be, it was across the street from my favorite restaurant, this Italian restaurant called.
44:26
I never even noticed that there, this isn't sound funny but a cute police department across the street.
44:31
And now I'm in the cell there, the arresting officer is the one booking me.
44:35
He took my mug shots and I said, Officer are these mug shots going to be online?
44:42
And he was like, yeah, but dude, you're not the founder of Google, you sell pants.
44:46
>> [LAUGH] >> And that was true, that was true, right?
44:50
If I had had a higher public profile there probably would have been press because of the mug shots.
44:57
It was under my legal name Andrew Dan, which is not a thing.
45:01
And I was in and out of court, and there are court reporters but it wasn't, it never happened on the PR front.
45:09
I was supported by the board.
45:11
Ben Wallace stayed with me but with condition, which is that I took my medication, and saw a doctor, and I became religious about staying healthy.
45:20
I started seeing a psychiatrist in lower Manhattan twice a week for 45 minutes.
45:25
I did whatever he said, medication-wise, and that included six months of experimentation where I felt suicidal everyday.
45:33
And I also knew, because after the big highs is a usually a long low.
45:37
The big high is fast, it's like a week, the low that follows it can be a half a year or years depending on the kind of treatment that you have available.
45:48
And I had great treatment available, which is a fundamental injustice that we have in our society, which is that mental health is reimbursed at a very low rate, and it's hard to find the right provider.
45:58
But I got through that, and so now I have a pretty robust system of medication.
46:06
I still see that doctor twice a week, and sleep is so critical, sleep is foundational, so I have a sleep report that I send, screenshot of a Fitbit report, a WhatsApp group and it goes every morning.
46:19
And so everyone knew yesterday which is a little bit annoying because I know my mom worries about it still, that night before last I slept four hours and 33 minutes.
46:28
And everyone knew I was coming to give this talk, which I was excited about.
46:32
And so last night was a high pressure sleep night.
46:35
So I was getting dinner, it was fancy, I treated myself to dinner at Nobu last night.
46:39
And I was at the bar and I looked down at the Menu and I saw cocktails that look good.
46:46
And then I saw the nonalcoholic user thing.
46:50
>> [LAUGH] >> It's $15 and I had three, and then I had a friend text, he's like you're in town, do you want to meet up?
46:57
And I was like, I so badly want to meet up and I was like, I can't slept four hours, big day tomorrow, then I went home and I took the right medication, my doctor and I had a plan and I had an eight hour night.
47:08
And I sent it to my family and my mom was like, good.
47:11
>> [LAUGH] >> So it's humbling to be in this kind of a dynamic, but I know that transparency with my loved ones is a critical part of my health and therefore theirs, so it's a pretty olympic regimen at this point.
47:27
>> Well, it's great to hear that you have a process that helps you today.
47:30
And whether you have bipolar disorder or not, mental hygiene is so important.
47:34
And I know mental health is the focus of your newest venture pumpkin pie.
47:38
So tell us a little bit more about that.
47:40
>> Yeah, so pumpkin pie started as an idea to find a husband for my mother-in-law, who's amazing, she's amazing.
47:49
And she's, how do I put this?
47:51
She's very talkative, and boundaries are not her strong suit.
47:55
So she's got a lot to offer and she's lonely.
47:59
I think she'd be okay with me saying that.
48:01
So, we started the company has an idea of how do we build a dating app for senior citizens I had been a founding investor and board member at Hinge, so I got to see the social mobile dating wars play out.
48:13
And I remember thinking as I spent time entertaining the idea of helping my grandmother, I should just go with her on the dating apps.
48:21
So I like took over her match account.
48:24
Have you ever dated as a 75-year-old woman?
48:26
>> [LAUGH] >> The guys aren't the best at writing the profiles.
48:31
>> [LAUGH] >> And yet there's so much knowable at that stage about someone's life.
48:38
All right, when you're 25, so much of your life stories in front of you.
48:42
When you're 75, there's so many choices and experiences you've made.
48:46
Have you spent your professional time whether you got married or not? Did you have kids?
48:50
It's just amazing amount of newable information and it's not really there other than the profile. So we developed this.
48:57
It's a game where you reveal your personality by opining on polarizing things.
49:02
And then we hired a computer scientist from this school and I recruited a GSB friend to be my co-founder.
49:09
>> [LAUGH] >> Some lessons diehard.
49:11
>> [LAUGH] >> He's the founder and CEO of chess.
49:13
com as his day job, so he's had an entertaining last couple of months.
49:19
And we built the algorithm in the app, and it had zero predictive ability around romantic relationships.
49:26
>> [LAUGH] >> But the sample group we set it out to include people who were platonic friends with each other.
49:32
And it was highly predictive of platonic friendship.
49:35
And so that's when we said maybe we could build Tinder but for platonic friends.
49:40
And the problem we've discovered with that and the reason it hasn't been built is that the two ingredients in a platonic friendship are mutual vulnerability in continuous, ongoing, unplanned interactions. >> Mm-hm.
49:52
>> And so how do you plan off of an app an unplanned interaction and that's the conundrum that we're trying to transcend. >> We will stay tuned.
50:02
Andy, I have one final question for you before we have a quick lightning round.
50:06
This is a question that we're asking all of you from the top speakers this year. >> Yeah.
50:10
>> Principled leadership is paramount at the GSB.
50:13
What do you view as your role and leading with responsibility to not just your organization, but also society at large?
50:20
>> Yeah, so I love Ken Chenault, who ran American Express, one of the great black CEOs and pioneers, and he ran MX through many things.
50:32
He was phenomenal CEO and also through 911.
50:35
And coming out of 911, where some 50 American Express employees perished.
50:39
He came out of that at some point and said that the job of a leader is just twofold.
50:44
It's two bullets, two words each create hope, define reality. And I love that.
50:51
And I think creating hope and defining reality are almost impossible to do at the same time because reality is scary and bleak.
51:01
And then hope is something that we need to magnetize people to follow us.
51:09
And we need to lead them somewhere winsome.
51:13
And so I look at where we are socially and hope is hard at the moment.
51:20
Hope is hard from a climate standpoint, hope is hard from a justice standpoint, whether racial gender, sexuality otherwise, hope is hard from a political divisiveness standpoint.
51:32
There's a lot to not be hopeful about.
51:36
And yet your job is to be hopeful and to convince other people to be hopeful to the people who will be following you in whatever you do next.
51:50
And then your job is also to not let those people down by not being realistic about what you're trying to do.
51:58
And doing those things together it takes a rare human that can do both of those things and many of those rare humans are right here.
52:08
>> Mm-hm, well, thank you.
52:10
That's a great note to end on.
52:12
We'll do a quick lightning round now just in the interest of time.
52:14
This is a view from the top tradition.
52:17
So Andy, I'll ask you four questions and- >> Yeah.
52:19
>> Please say whatever comes to mind first. >> Okay, I'm ready. >> All right. [INAUDIBLE]. >> [LAUGH] Yeah.
52:23
So the first one is best piece of advice ever received.
52:27
>> You catch more flies with honey. >> Nice [LAUGH].
52:30
Next time the Cubs will win the World Series. >> 2034. >> Wow, okay?
52:35
[SOUND] Most memorable GSB class.
52:40
>> Interpersonal dynamics.
52:41
>> Yeah, fan favorite [SOUND].
52:43
Favorite bonobo is pants print.
52:46
>> The Pink Panthers, before the trademark, shut us down, >> [LAUGH] >> Wish we had a model wearing that today.
52:53
Andy, you didn't give your talk here on campus when you're a GSB student, but thank you so much for coming back and sharing your story today. >> Yeah, thank you.
53:01
>> [APPLAUSE] >> Thank you so much, Andy. >> Thank you. >> Thank you so much. >> Yeah, [LAUGH]. >> [APPLAUSE] [MUSIC]