The Power of Generosity in Commerce

Phillip: [00:00:05] Hello, and welcome to Future Commerce, the podcast at the intersection of culture and commerce. I'm Phillip.

Brian: [00:01:22] I'm Brian.

Phillip: [00:01:23] Got a great episode here for you today. Chock-full of conspiracy theories, overheard backroom conversations, touch on Ozempic for a minute.

Brian: [00:01:34] {laughter} Oh, gosh.

Phillip: [00:01:35] And then we have a great interview for you a little bit later on. Brian, you are a man about town. You've been traveling quite a bit, and you got to sit down with a brand that's been on the up-and-coming sort of hot streak.

Brian: [00:01:48] Yeah. Yeah. Mike Beckham, the CEO and Co-Founder of Simple Modern, which is just honestly an incredible company. Beautiful products, beautiful people, beautiful company. It's just beautiful. It was all love. All love ahead. It's all love ahead. Get ready.

Phillip: [00:02:05] I'm not jealous in any way. Been watching them for a long time. I don't want to say, like, the build in public sort, but they definitely have a multi-party sort of multiplayer approach to talking about the brand from an operator perspective on social media, LinkedIn in particular, and Twitter. And that's how I've come to know it. But, obviously, it's hard to go into a Target or something without seeing the brand. It's hard to tune in to pretty much anything without seeing people. People, like, love them some steel insulated cups and accoutrement.

Brian: [00:02:41] It's true.

Phillip: [00:02:42] It's true.

Brian: [00:02:42] And they've got the no-leak straw. Right? Or however it works.

Phillip: [00:02:46] Something like that. I'm convinced... So there was a scene... I saw The Marvels over the weekend, Brian.

Brian: [00:02:54] Good? Bad? Good?

Phillip: [00:02:56] We enjoyed it. I don't know what the hate is.

Brian: [00:02:58] I saw your tweet.

Phillip: [00:03:00] Lots of people are just over Marvel content, and I totally get that. I thought The Marvels was great. Pretty sure...

Brian: [00:03:07] Nice.

Phillip: [00:03:08] I don't know. I don't know if it was Simple Modern. Probably wasn't because I would have seen people taking a victory lap on Twitter over it, I'm sure. But, there was a shot where there was very obviously a steel, vacuum-sealed cup variety, I'm not sure what the brand was. I couldn't tell you what the brand is, but it was definitely...

Brian: [00:03:33] In this case, rising tides lift all boats. Yeah.

Phillip: [00:03:37] Basically.

Brian: [00:03:38] Stanley, Yeti, Simple Modern, whoever else.

Phillip: [00:03:41] It's in there somewhere. Whichever one it was. It was one of those. I was like, "Wow. They get that in space. That's omnichannel."

Brian: [00:03:49] Wonder how much that cost.

Phillip: [00:03:51] So much money.

Brian: [00:03:53] It's such a strong cup. It can't be crushed by space.

Phillip: [00:03:59] {laughter} The value prop is baked in. "If it's in space, it's probably good enough for you here on Earth."

Brian: [00:04:06] {laughter}

Phillip: [00:04:06] Somebody should steal that tagline. There's an amazing conspiracy theory going around. And by going around, I mean, I saw it tweeted once from Ashwinn Krishnaswamy, who's a collaborator. I can't speak today. I'm on, like, week 3 of post-strep sickness, Brian. I think it's going to my head in a lot of different ways.

Brian: [00:04:26] Man, I swear, it's not strep anymore. It's definitely infection.

Phillip: [00:04:31] Yeah.

Brian: [00:04:32] You're infected. You've been infected.

Phillip: [00:04:34] A virus.

Brian: [00:04:36] Was it World War Gen Z. What's it called again?

Phillip: [00:04:41] World War Gen Z. That is a show title if I've ever heard it. We're gonna write that one down. World War Gen Z. No, there was a conspiracy theory going around, started by Ashwinn Krishnaswamy. So Ashwinn on Twitter, put out a little bit of a what if, maybe this follows The Marvel.

Brian: [00:05:05] In on this. Let's go.

Phillip: [00:05:06] What if Kim Kardashian is just deft enough of a marketer that she pulled together what might be the most brilliant marketing campaign of all time? So you'll remember just a couple of weeks ago, SKIMS announced a brand new bra, that has fake nipples built in. Brian, I'm sure you remember this.

Brian: [00:05:23] Their most successful viral marketing campaign of all time by Kim Kardashian. Yeah.

Phillip: [00:05:28] Has to be. As rated by no data other than us, recency bias. But it made the rounds. And what Ashwinn sort of proposed was, this happened on a Friday, it happened on a Friday where they soft launched men's and a partnership with a few athletes, who I will pull up here in just a moment. But when they soft launched men's, they did it, according to Ashwinn in sort of the feed, both on TikTok and Instagram. And they launched it there, very light press pickups on that. And then the nipple shirt heard round the world, happened with this viral video of Kim K sort launching this bra that nobody asked for, which is interesting. So the implication there is that then the Monday afterwards, they announced a formal partnership with the NBA to be the sort of official underwear...

Brian: [00:06:32] Which is wild.

Phillip: [00:06:32] Which is unbelievable. Brilliant.

Brian: [00:06:34] So here's my take on that. The Kardashians are, if anything, good at leaning in to what they can. They're like the Bill Belichick of Brand. Bill Belichick was incredible at, like I'm using a sports analogy because, you know, there's a football in my background. But he just found whatever possible mismatch there was, and he just leaned in super hard into it. And that was what made him great, and Tom Brady did the same or whatever. Maybe it's the Tom Brady of brand marketing, whatever. The pair of them just found those gaps and just hit them as hard as they possibly could. And this is how I feel about the Kardashians. They're the masters of leaning in. They lean in. Whenever they have a chance to lean in, they lean in. That's the take I have.

Phillip: [00:07:28] It's funny because the way that Kim K's career was launched was a tape of someone hitting the gaps as hard as they possibly could as well, but I digress.

Brian: [00:07:42] She leans in.

Phillip: [00:07:44] She leans in. What I find really interesting about this is the way that brands can manufacture this for themselves. This is something that a long-time collaborator on our side, Alex Greifeld, has talked about manufacturing virality is not so difficult in 2023. And it's not something that you couldn't necessarily pull off. In fact, she wrote a piece for Future Commerce Insiders. The 5 or 10 weird ways that you could look to try to manufacture organic engagement, and that's effectively what this is. They, SKIMS, leaned into a really smart product launch that created a halo around the thing they really needed to draw attention to, which is category expansion for the business and professional partnerships that lean into what men want to see from a brand like SKIMS. And it completely reoriented the brand at a time when they were being both hyper-feminine and hyper-masculine. It's really smart, and it can't be by accident, especially when you look at how they continue to do that now weeks later, with this print aesthetic campaign they're doing.

Brian: [00:08:55] Yeah. Yeah. It's like SKIMS, S K I MMMS...

Phillip: [00:09:01] {laughter}

Brian: [00:09:04] Yes. Very Marshall McLuhan of them actually.

Phillip: [00:09:09] It's true. It's true. There are a lot of really interesting marketing lessons you could probably learn from the Kardashians. Interestingly enough, there are other folks making content like that out there in the world already. So, just today, earlier today on Twitter, I posted that there's a longtime follower of the show, Future Commerce, it's the folks over at Brick Space Lab. So Thomas over at Brick Space. He and, I think, Ali at Brick Space, they're a Shopify shop, they have a YouTube channel where they do sort of brand breakdowns, and they've been looking at this. The series is like "Keeping up with the Kardashians eCommerce," and they're like doing Shopify store tear-downs of different brands. In particular, there's a sock brand, I guess, that Robert Kardashian had launched. And so they're just ruthlessly tearing it apart for 18 minutes. Like a total roast, which comes back to the multiplayer brand and sort of the critique of it all in the space on how a culture does impact commerce.

Brian: [00:10:17] Yeah. Straight out of The Book of Probes by Marshall McLuhan... "Your enemies are your best PR." The critics are almost always the ones that provide the most value. And you're right. This is right out of the multiplayer brand. This is critique at work and in an aged, art form. It's something that was purely utility at its start, and now it's an art form that deserves critique or needs critique.

Phillip: [00:10:53] Exactly. And that's where it's like from a channel to a medium. You're moving from a channel for sales to a medium for expression or message delivery, delivering a kind of a cultural export of some kind. This SKIMS, ski aesthetic, by the way, is really interesting because I don't think I've seen Kim, looking as thin as she has been, in this picture in particular quite a long time.

Brian: [00:11:26] Are you referring to Ozempic?

Phillip: [00:11:28] I'm not even inferring. I'll just say, man, I think she's obviously on Ozempic, and sort of showing off the change of the body, like, looking at herself as a reflection of some standard of beauty or some aspirational form of the female figure. It's kind of interesting to me that it comes at the same time as Victoria's Secret pulling out of inclusive sizing, where maybe there is a future-proofing of this is where the culture's going and brands are thinking ahead to what is culturally aesthetic in the coming decade, and how do we position ourselves to be there since we missed the last wave? It's kind of interesting.

Brian: [00:12:12] Maybe with Victoria's Secret, they're projecting a little bit for sure due to the recent weight loss drug phenomenon.

Phillip: [00:12:22] And the anti-woke movement too, probably. They're trying to lean into some messaging there. Yeah.

Brian: [00:12:26] Well, it's almost like, "Oh, why did we ever leave the thing that we had already leaned in really hard on? Let's go back to..." It's like the Crocs revitalization. Why are we trying to be more than we are? Let's just stick with our core message, which is "sexy."

Phillip: [00:12:47] Well, the problem with sticking with the core message is that there was a period of 7 or 8 years where that message was no longer culturally relevant. And that's, I think, what Future Commerce is kind of becoming is figuring out how brands, the best brands in the world, determine what is culturally relevant for the future so that they can position themselves to be there for it now. The way that I know brand leaders are doing that today is they're subscribing to Future Commerce Plus. And so you can see around the next corner too, and join some incredible brand leaders by joining Future Commerce Plus. To get more information about that, you can get bonus episodes, new exclusive content, ad-free episodes of the podcast, discounts on print and merch from Future Commerce, a little bit of guidance, and 1 to 1 in a way that you previously had inaccessible to you. But we're happy to help you lead and figure out what's around the next corner, and you can get all of that for one low monthly subscription price. Join the membership at FutureCommerce.com/Plus. Brian, get us into this interview.

Brian: [00:13:53] Yeah. So next up, we have Mike Beckham from Simple Modern. He's their CEO and Co-Founder, and in it, we get into the details of how he's been able to achieve unprecedented growth through eCom, really. It's mind-blowing. He talks a little bit about tactics and how he built his last business just using tactics, but how that falls down when you want to build something that's more lasting and is better set up for the future. So without further ado, let's get into that conversation I had with Mike. I am here live at Retail Summit's eCommerce summit in Austin. I'm very excited to be here. It's been an incredible show so far, and I'm only halfway through. Just got off the stage from a Technology Trends for 2024 panel, and that was super, super fun. I'm here today and joined by Mike Beckham, the CEO of Simple Modern who's had an incredible time at this conference as well. I'm very excited to chat with him. Welcome to the show, Mike.

Mike: [00:15:02] Thanks for having me.

Brian: [00:15:04] It's good to be here, in Austin. Where are you from?

Mike: [00:15:08] So I'm from Oklahoma. I've actually lived there my entire life, and that's where the company is based out of these days.

Brian: [00:15:13] Nice. It's amazing. And, Mike, you got a chance to catch my session on top technology trends. But as we look ahead to next year, we were just chatting, and you were like, "Yeah. Technology matters. But is that really the most important thing in terms of how commerce is going to shift in 2024?" What is your viewpoint on that?

Mike: [00:15:37] Well, so I'm unique in that I've been in the eCommerce space really since 2009, which, you know, makes me basically an absurdly old dinosaur compared to most people. I got involved back when Shopify was still a fledgling kind of idea, And AWS didn't really exist. It was a different world. So I've been around the space for a really long time. And one of my observations is that the space can really gravitate towards tactics over strategy.

Brian: [00:16:09] Yes.

Mike: [00:16:09] And the problem with tactics is that they work until they don't. And this is true, you know, if you get on Twitter or, if you go to one of these conferences, you will hear a lot of, "Hey, this is what's working for us right now," and there's kind of a rush for everybody to apply the latest tactic, the latest hook that is effective. I think what we need to do, if we want to build strong companies, we want to build resilient companies, you've got to build on a strategy that's going to work in a bunch of different climates, and that's not tactic-dependent.

Brian: [00:16:42] Yes.

Mike: [00:16:42] And that's what we've tried to do. I think some of it is I have a background in a company that I built with my brother where we were great at tactics. We probably were not as strong at strategy as we could have been, and so unbelievable. I mean, in a 7 year period, it did almost $1,000,000,000 in sales.

Brian: [00:17:00] Wow.

Mike: [00:17:01] Which was just an unbelievable story in the evolution of the DTC space, but, we were also very fragile. When we started to see some of the marketing approaches that we had used not work anymore, there weren't necessarily great pivots for us. So what I'm trying to do with the current company that I lead, Simple Modern, is build a company where the culture is really strong, where we attract really talented and capable people. And, certainly, we want to be effective with our tactics, but tactics come and go. If you have the right team, really capable people, they're going to be able to adapt and find the effective tactics in any environment because you have the right kind of foundation. So I think that that's the idea that I end up spending most of my time at these types of conferences talking about. I mean, part of it is that I'm involved in the business, but I'm not on the front lines of trying new tactics every day the way I once was, but also part of it is because I've been around long enough to realize that the things that will really move your business... Because I think, ultimately if you're building a business, you're probably trying to create what we would call enterprise value.

Brian: [00:18:15] Yes.

Mike: [00:18:15] You know, you're probably trying to get off the treadmill of just trying to pay for this month's rent or to squeak out a profit this quarter. You're trying to build something that has enduring value whether you want to sell or whether you just want to be able to use that money in some other way.

Brian: [00:18:31] Yes.

Mike: [00:18:31] And so you can't do that on the back of tactics. It's pretty much my conclusion. You cannot get enterprise value on the back of tactics, but you can build enterprise value on top of culture and on top of having an exceptional team. And then when you add great tactics to that, something special happens.

Brian: [00:19:36] If you've been listening to this podcast for a while, all of our audience who are faithful listeners will know right now that you are singing the songs that we sing at Future Commerce right now. And to see a brand like yours that's been so successful in investing in people the way you have, I love the idea of building employees who understand the strategy, who are flexible enough and adaptable enough to understand that tactics have an end date. And, yes, you do have to apply them, but it's because of these bigger strategies that you make those changes. It's just music to my ears. And so, tell me a little bit more about your approach to your employees because that culture that you're building, extends from employee to customer, and I think that you could feel it. Even the product. It's like everything sort of stems from that employee relationship that you built.

Mike: [00:20:32] Sure. So I'll start with this, we built the company on an idea that we want to build a company that the mission of the company is something unique and something that makes me want to get out of bed in the morning, makes me want to do this. I'd been in the eCommerce world for almost 6 years already when we started this company, now I've been in the world for almost 14 years. So I knew I was going to need something where I could draw a straight line between my effort for the day and feeling like what it produced, the way that it impacted the world, was worthwhile. And I'd already been a part of selling enough stuff that just selling more things was not going to do that for me. Wasn't gonna drive that satisfaction. And I'm very passionate about the idea of generosity. I think generosity is one of those things that when we engage in it, not only does it impact other people's lives, but it makes our life better. It's one of the true non-scarcity mindset, everybody wins type of things that we can engage in. And so I got excited about an idea of what if you built a company where two things were true. First, the purpose of the company was actually to be like, "Okay. How much can we kinda push the boundary of what generosity could look like in a for-profit company?" Because it seems counterintuitive. If you're trying to create profit, then giving money away works against your primary goal of being able to make money, but I had this theory that, no, that's not actually true. What actually happens with generosity is when we give it turns out, and I don't know why this is, I mean, some of it's reciprocity. Maybe it transforms us in a way, but it just tends to be that people want to repay that and people want to give back, and you end up getting more than you started with in the beginning. It's kind of one of those virtuous cycles. And so I believed that that idea was true and that you could build a lot of brand equity and brand loyalty around that concept.

Brian: [00:22:28] Hmm.

Mike: [00:22:28] That was a fairly radical... I mean, I think...

Brian: [00:22:30] It's still radical.

Mike: [00:22:31] It's still radical. And honestly, when I talk to people about the idea, most people, only have two or three kinda avatars they even can use to think about this idea. They're like, "Oh, is this like Tom's?" It's like, "Yeah. Maybe. Kind of. There's an element of that." But I think it's even a little bit deeper than the transactional, "If you spend this, then we will do x." I think our idea is that we define generosity probably in a more encompassing way where it's like, "Hey. The whole point of the company is that everyone who interacts with the company, and that is the employees, that's the partners that we work with, that's the customers we serve, that's the community that we're in, that's even the shareholders. It's everybody. Everybody has their lives enriched in some way as a result of interacting with the company." And the more you do that, the more that people want to work there, the more that want to buy things from you, and the more the partners want to work with you. It's this like I said, it's this big virtuous cycle. So it's not so much like, if you do this as a customer, then we'll do this. It's more like, no, we're gonna be about generosity no matter what the customer does, no matter what the environment or the economy does, and, obviously, as more and more people want to buy our stuff we have the capacity to be even more generous. And we just I think some of it is because you just believe there's a way that the world ought to be.

Brian: [00:23:53] Yeah.

Mike: [00:23:54] Everybody, regardless of what you think, I would say spiritually or kind of moralistically, I think everybody sees a gap between the world that could be and should be and the world that is. And what's very motivating to us, I'm convinced, is when we feel like in some small way, we move the ball of closing that gap, and that's the kind of thing that can get us out of bed and that can help us to push through even incredible hardship and difficulty sometimes if we can see a way that we are actually making a tangible difference. And so we said, "Alright. We're going to build a company that's really focused on this fairly radical idea of generosity, and then we're going to try and build a company where you just really want to spend time with the other people you're working with." We tend to build teams, as these highly, disinfected, like, you bring these skill sets, I bring these skill sets, like a puzzle. Like, we're just trying to match up all the skill sets. But the reality is great teams have chemistry.

Brian: [00:24:55] Yes.

Mike: [00:24:55] And chemistry comes from affinity and trust and affection, and that gets built through relationships. It's that simple. So we're living in a world where technology has made it possible for us to do some things from a team perspective we never could do. Like, you mentioned, your Co-Founder is on the other side of the country. In Florida, and you're in Seattle. And well, that's not that wasn't even really possible to do that well 10, 15 years ago. But what's also true is that it's easier... People's freedom of movement is higher than it's ever been before. So, like, people are not going to stay on teams that they don't want to be on, or if they're on a team where they're they're well compensated or whatever, but they're not connected in any way to their teammates, they're constantly people are going to be coming at them with offers person trying to peel them away.

Brian: [00:25:44] Right.

Phillip: [00:25:44] And so the idea was, for me, I didn't necessarily enter into Simple Modern with, how do I make more money? I entered into it with how do I maximize quality of life. And for me, quality of life was meaning, And it was that the hours I'm spending at work, I'm spending with people that I would want to spend time with anyway.

Brian: [00:26:03] That's amazing.

Mike: [00:26:03] And when you start with that, then it takes it's interesting how that transforms both the work that you do, doesn't feel as much like work, obviously, but also the endurance and willingness to go through hard stuff and to make less money than you would be doing somewhere else. Like, all of that stuff gets a lot easier when you're like, "I really enjoy who I'm in the trenches with."

Brian: [00:26:27] Yep.

Mike: [00:26:27] And I think it's meaningful. I think what we're doing is meaningful. And in our case, one of the ways that I think it's translated into success is because, honestly, people listening to this, there's a lot of things that from my perspective we do somewhere between an average to slightly above average level. Now there are a few things we do exceptionally, But there are a lot of things, a lot especially a lot of the tactics and especially a lot of things that have to do with traditional DTC success, like marketing, that we have not built as strong of muscles in because we didn't focus on them first.

Brian: [00:27:00] Mhmm.

Mike: [00:27:00] But the observation I would make is because we focus first on culture, meaning, and purpose, and building some of these other kinda a sense of who the brand is and great product and bunch of other stuff, you can always add the tactics.

Brian: [00:27:13] Right.

Mike: [00:27:13] You can always build some of these other competencies on top.

Brian: [00:27:15] There are things that change all the time anyway. So it's like you you you might have if you had built on tactics first, by the time you got to where you are now, you'd just be adding tactics anyway.

Mike: [00:27:24] Exactly. And culture is very difficult to change midstream. And you know what? I'm always empathetic when people are like, "I really love your idea, but I'm in this context where this is the situation or we're really kind of adrift when it comes to culture. How do I fix it?" And I'm and I'm always hopeful, but I'm also, like, realistic that it is more difficult. It's always more difficult To take a culture where it's not clear what the soul is and then to try and forge one of those. I do think this is also one of the important parts about being a founder is that the founder gets to speak with a voice that really nobody else has of just being able to say, "When we created this, we created it to be this." And that's not to say that things can't evolve, but you need to have some kind of point of truth or voice of truth about what is the purpose of this thing? What is it supposed to be about? And, obviously, the founding voice, I think this is one of the reasons that the research It's really clear that founder CEOs outperform nonfounder CEOs. And, you know, some of that I'm sure has do with understanding of the business and buy-in of the team and other stuff, but some of it just comes back to they're able to speak with a voice of "This is what we're about," and it's difficult for somebody who's a transplant or hasn't grown up through the organization to do it. So, anyway, we've really focused on culture, and we focused on purpose, and then we built all the other stuff on top of it. And as a result, one of the ways played out is that we have exceptional retention.

Brian: [00:28:53] Mhmm.

Mike: [00:28:54] And what's also been interesting is we've had really good retention not just within our team, but even the partners that we work with. Our primary manufacturer that we've worked with in China... We do some domestic manufacturing. We do some in China. Their entire team's the same team we've worked with for 7 or 8 years.

Brian: [00:29:09] Wow.

Mike: [00:29:09] Many of our partners. And so that it is hard to overstate the power of continuity in building a great team. So, anyway I think that's a very long-winded way of answering the question that you asked.

Brian: [00:30:23] Dead on, everything you're saying is just resonating with me. I was thinking about the newer generation of workers who are just coming out of college right now, and there are a lot of studies and thoughts out there. There's the Twitter thing that went around recently that got like, both supported and blasted about the 9 to 5 idea.

Mike: [00:30:44] Sure.

Brian: [00:30:44] How do I have a life and work a 9 to 5 in today's environment? Because it's really, like it's not really 9 to 5 anymore.

Mike: [00:30:51] Yeah.

Brian: [00:30:52] And, so as you look at the younger generation and bringing them into this culture, do you find that I mean, maybe I'm leading the witness a little bit, but you find this is resonating with Gen Z?

Mike: [00:31:02] Well, it's just different. And I think that everyone has to understand that every generation after you has a very different frame that they've experienced the world through. And that we can empathize and that we can intellectually understand. We'll never fully emotionally understand, but we can intellectually at least try to understand the way that they've experienced the world. And my opinion is it's not helpful to try and kind of cast judgment one way or the other of is this a good perspective or bad perspective, but this is like this is the way that they're viewing the world that fundamentally, they want the same things that I want, but the expression of that and how they pursue them can look really different. I think the video that you're talking about, for example, I actually posted something where more or less, I said, like, "People are kind of tearing this person down, but listen, it is hard to work a 9 to 5 job." It is hard the 1st time you come out of work and it's dark outside, and you get home and you're like, "I guess I'm gonna eat something I heat up in the microwave. I'm going to go to bed. I'm a do it again." Like, that is hard. It's also true that, like, that's not saying, hey. This person's soft or the next generation is doomed. But saying, "Transitioning to adulthood is hard."

Brian: [00:32:11] Yeah. Yes.

Mike: [00:32:11] And also saying, "Transitioning to adulthood when technology's been an infused part of your life and something like a commute not making sense, that's gonna be especially hard."

Brian: [00:32:20] Yes.

Mike: [00:32:21] And that there should be some empathy for it. But what I would say is this. I would say that this generation, there are things that they're gonna need to grow in, and there are things that they're strong in. One of the things they're strong in is that they are particularly focused on that gap that I talked about between the world that is and the world that can't be, and they care intensely about that gap. And now I think some of the times, their ideas about how to bridge that gap may be a little bit misguided. We've all had that, periods where we thought, "Oh, I know better. If I was in charge, I could fix things."

Brian: [00:32:54] Me in my twenties, man.

Mike: [00:32:55] But yeah. Exactly. We've all had a phase where we're kind of in the arrogance of youth. We think that we've got it all figured out, but you can't do anything really but applaud that they care that deeply about saying, "I do want to impact the world and the world can be better It should be better." An example of how this line of thinking can be difficult... So I'm the entrepreneur in residence at the University of Oklahoma, and I talk to a lot of students that have start-up ideas. I work with groups that have start-up ideas. And to that kind of audience, what I do is exceptionally attractive, the focus on generosity and having cause being a real part of a focus of a for-profit company. And when they come up with business ideas, often they'll come up with ideas that are like, "We're gonna do this thing, but we're gonna give money to dogs with finding dogs homes. Abandoned dogs. We're gonna help find them homes." Or "We're gonna give money towards homelessness," or whatever. The problem is that often they will misunderstand the sequencing here. They will think, "If I have a great cause, that's the most important part, and then all the business stuff will kinda take care of itself and people will want to shop from me." Unfortunately, that's not how it works with the customer. I think internally starting with who you are and what you're about, that's absolutely the right way to do it. But externally, that's not the way it's gonna for most customers. You have to earn the right to be heard about the way that you want to impact the world. And so I'll tell them sometimes you earn the right to be idealistic. So ironically, what I have to do often with students is say, I don't want to hear about what you're gonna give. I know this is counterintuitive. You would think that'd be where I'd want to lead, but I actually don't want to hear that. First, I want to hear How are you adding value to people's lives, and how are you making their lives better and earning the right to then introduce the way that you want to impact the world?

Brian: [00:34:47] Right.

Mike: [00:34:47] So it's a good example where it's like, the heart's great, and I think you've got a lot of students that are gonna make a real impact in the world, but they also have to learn to the entrepreneurs and they have to learn the marketplace does not care how great your heart is. That's the marketplace is gonna be a really hard hard world. Inside your company, when it comes to recruiting people, I think it's a different story. So that nuance is part of what I communicate when I'm with students. I think when you talk to people that are in, say, their late thirties, forties, fifties, I think the message is a little bit different. It's telling them, because we can all get a little bit cynical, it's helping them to see that, yeah, it is possible to take whatever company you're in and to move it towards a company that makes the world a little bit more the type of world we want to live. And what does that look like for you? And sometimes it's like, "Well, you know, I'm in a 30,000 person company, And my company's culture is not this. I wish it was, but it's not that." And then the question is, okay, but are you on a are you on a team? What's the subculture you're a part of? What are the micro ways that you impact culture at that company or would you have the ability to apply some of these ideas and build something meaningful? And when you do that, that creates change, and people see that, and they see that as attractive, and people want to join your team, and it drives out performance and all that stuff. So depending on the generation, I think the way that you want to press on this idea looks a little bit different because the stumbling blocks are a little bit different, and nobody has, I think, a monopoly on the right way to approach it.

Brian: [00:36:26] Right.

Mike: [00:36:27] I think part of the reason why you have... I mean, it's worth asking the question, why do you have a generation that looks at capitalism, for example, and you have such a high percentage of the population that thinks communism is not bad. Maybe communism would be better. If you look at a lot of the polling of people you'd see the favorability towards communism, especially in people under 30 in this country is probably the highest it's been in a long time. Why is that? To some extent, I think that that's the falling down of capitalism in America, a casting vision for, like, the amazing power for good that business can create, and then at the same time you've got people that are just coming in that have all these ideas about how to change the world. They've gotta be coached into where you earn that right is by creating value and lots of people. So, anyway, those are the drums I beat.

Brian: [00:37:19] Man, that is incredible, Mike. I love what you had to say. If the world does look different in 2024, it's through teams like the one at Simple Modern that are focused on building a culture that actually has meaning involved. At some level, when you go to your job, you actually care about what you do, and you feel like you're making an impact, and you like the people you work with. Does it get any better than that?

Mike: [00:37:44] It hasn't for me, and I say this often. Our company, obviously, It's very profitable at this scale. And I'm not the only owner, but I'm the biggest owner. I've never considered a sale, and the financial piece of it is not motivating, especially at this point. I mean, there is a point where your bank account where it's like, it's just zeros. Functionally, I'm not gonna live my life any differently based on what the company does, and I'll get asked, "Okay. So why not? Why not sell the company? Why not do something different?" And the answer is that why would I trade a high sense of purpose and that my days are filled working on problems I enjoy with people I enjoy for a bunch of paper? Like, why would I do that? That's crazy.

Brian: [00:38:28] Yeah. Yeah.

Mike: [00:38:28] Because, really, most of the reason that we work for money is because then we think we can then take that money and convert that into meaning and purpose and time experiences that we'll enjoy, and so this is probably one thing that I would say that I think is it's interesting I don't hear it talked about more. What people are wanting when they come and work at your company or when they apply for a job is they want to know who's gonna give me the best package when it comes to quality of life? Now they're not gonna say it that way.

Brian: [00:39:00] Right.

Mike: [00:39:00] In most companies, the extent of how they can compete is we can offer this much money. Or this many days off or these kinds of benefits, but they're only competing across a very small sliver of the dimensions that we know through research, guide quality of life. The quality of life has a lot to do with who we spend our time around, the meaning and purpose we find from our work, feeling highly empowered and trusted, and being able to learn and be pushed in our job and in a number of other... There are 3 or 4 other things that the research says matters. So when we're able to create environments where we're able to offer all those other things, it's very difficult for anybody to compete against us. We have not had somebody recruited out from under our company.

Brian: [00:39:45] Wow.

Mike: [00:39:45] Only time people have left is when, "My husband got a job, and I want to support my husband being able to take this job in Houston," and we're an in-person culture. It's like, "That's great." Or "My dad got cancer. I want to go and support my dad," and now it's like, "Great. You should do that." But people don't leave because they got a better offer from somebody close, and I'm not convinced that that's because we're a perfect company. It's more just that we're thinking intentionally around how are we creating high quality of life.

Brian: [00:40:11] Yes.

Mike: [00:40:11] Through the whole thing. So when you create high quality of life, it turns out, people figure that out and your applicant pool gets really big. There are a lot of people that want to work at your company. And as you have a lot of people that want to work at your company, you're able to get high talent density, high alignment around the things that you're about. And sure enough, that almost always translates into outperformance. I mean, we can make this thing complicated, but there are people who are more gifted than other people at certain things.

Brian: [00:40:41] Yes.

Mike: [00:40:41] And that wherever those people go, good performance tends to follow. Good financial performance tends to follow. And so a lot of the game of being good at business is about the teams that you build.

Phillip: [00:40:52] Mhmm.

Mike: [00:40:52] And about getting really talented people. But it's always worth asking, like, why should somebody other than the fact that I want them to, like, why should somebody want to come and work with me and want to join me?

Brian: [00:41:04] It's entrusting a good chunk of their life to you.

Mike: [00:41:07] Absolutely. I'll give an analogy there. There's this interesting idea of why is gold valuable. So why is gold valuable? What would you say?

Brian: [00:41:16] It's rare. It's something that's tangible. The resale market is always there. There are a lot of reasons why gold is valuable. I'm curious where you're about to go.

Mike: [00:41:27] Well yeah. Exactly. Because it's like when you ask that question, it's like, well, I know that gold's valuable, but I'm not exactly sure why gold is valuable. And it's like, the rarity has something to do with it, but even still, we still don't do anything except make good jewelry with it. Gold doesn't have a functional purpose, so why does it matter if it's rare? There are a lot of things that don't have a functional purpose that are rare that we don't care about. Why gold? Especially why has gold historically been such a valuable thing? If you look over the last couple of centuries at least, millennia, if you look back to biblical times, like, gold's a big deal going into ancient civilizations. Why? So the most compelling answer that I think I've heard is because it is so hard to get, that's what made gold valuable. And here's what I mean by that. If you were a king that wanted gold, well, what do you need? Well, you need lands that have mines on them. Okay. And then you need people who are willing to go into those mines and are able to extract the gold, and then you need industry that's able to kind of refine and, you know, smelt and do things with that gold. And then you need to be able to defend that gold so that somebody doesn't come and take it. So you need to be able to have armies. And that gold is like to use a cryptocurrency idea, gold is like proof of work. Your having gold shows a lot about your competence as a leader because of how difficult it was to get. Right? And that it inherently has value because it was just difficult to get it.

Brian: [00:42:56] It was mined.

Mike: [00:42:57] That's exactly right. So in the same way, when you think about the people that we work with, there's inherent value in people taking their most valuable asset, which is their time, and pouring it into working with you. It is the ultimate, I would say, act of sacrifice. Even if you're paying. We're giving away the one thing in our life that's the most valuable that we can't replenish. We're giving away our time, and so there this inherent value, and I've talked about that. In fact, I talked about this exact concept to our entire team at our Christmas dinner last year. I'm so grateful for everyone who chooses to be a part of our team and take their most valuable resource and invest it in the company. But when you start to think about it that way, not just there are a bunch of people out there that want a job, and I've got money. And they should work hard because I'm giving them money kind of an entitled point of view. When you take the point of view of anybody giving me their time, that is a massive sacrifice, and I need to have a really compelling value proposition to get somebody to trade the very essence of their life for Building my cause, my organization. The other thing it does is it makes you as a founder ask the question, am I building something compelling enough that it's worth giving my time? You know?

Brian: [00:44:15] Totally. I love that. One of the articles I wrote, I think last year was about commerce as identity exchange. It's literally and whether it's employment or purchasing something, when someone comes and they give their hard-earned money for a product they're taking something that people spent time to make and to market and to craft and put themselves into whether that's through a specialized job or through being an actual craftsperson or whatever it is. And then they pass that over. That's like one person giving up their life, their values, and everything for the other person's values. And so, just think if you apply that to employment as well, all of this is just it's us passing ourselves on to other people. Is what we're giving to each other actually fully giving of ourselves? And I think that's, we're gonna do an event at Art Basel coming up here called Muses. December 6th or 8th. Be there.

Mike: [00:45:23] Yeah.

Brian: [00:45:24] And it's about this idea of what is worth getting caught up in? If somebody is going to insert their identity into your story as a brand, why would they actually want to do that? Is it inspiring enough? Are you actually providing them with a narrative that takes them to go create themselves and enhance their lives or do something new or serve a purpose for them? And so, I am so happy that I got to talk with you, Mike, about this. This just gets me hyped, and I love what you're building. Great work. Thank you for coming on Future Commerce.

Mike: [00:46:06] Yeah. Thanks for having me.