Table of Contents:
- Lee Zlotoff on creating the TV series MacGyver
- “Gather as many no’s as you possibly can”
- The rejection that Katia Beauchamp faced when pitching Birchbox
- How Peloton’s John Foley converted skeptics
- Tristan Walker on dissecting the quality of rejections
- Princess Reema on advocating for women’s empowerment in Saudi Arabia
- Tyra Banks on saying no to opportunities that aren’t right
Learn from every “no”
Lee Zlotoff on creating the TV series MacGyver
LEE ZLOTOFF: The way MacGyver came to be is kind of an unusual story. I was actually hired to write a pilot with a different concept. The studio said, “We’re so excited about this because it’s never been done before.” And I went, “Well, that’s great. What is it?”
REID HOFFMAN: That’s Lee Zlotoff. He’s a writer, producer, and director, and he created one of my all-time favorite TV characters, MacGyver, the secret agent famed for being able to improvise his way out of any jam with just his trusty Swiss Army knife and the judicious application of duct tape. However, the exciting idea for a show that the studio wanted Lee to work on was a long way from the MacGyver we know and love.
HOFFMAN: Like his creation, Lee has a can-do approach to creative problem solving. So he didn’t leave his response to the studio’s idea for a TV series at a simple no.
ZLOTOFF: Now, nobody likes to be told their baby’s ugly, so I explained to them why it wasn’t going to work. I said, “I could write that as a pilot, but you really want me to write something that will sustain as a series, correct?” They went, “Yeah.” I was then tasked with trying to come up with a single-action adventure hero series.
HOFFMAN: The tables were turned, and now it was Lee pitching the studio.
ZLOTOFF: I went through a number of iterations, which I took to the network, none of which they liked. They said, “No, no, no, no. You got to fix it now.” So I was becoming a little desperate.
HOFFMAN: Faced with this constant string of rejections, Lee felt like he was in a no-win situation. With his back against the wall, he quickly came up with a way forward.
ZLOTOFF: I gathered all my writer friends in a room, locked the door, provided them with every conceivable inebriant that they might want, and basically said, “We’re not leaving this room until I have a great idea for this TV series.”
HOFFMAN: It was clear to the increasingly inebriated writers that Lee wouldn’t be taking no for an answer, so they got to work.
ZLOTOFF: So they said, “Well, what do you got?” So I told them, “I’ve got nothing.” And it was a long pause. Then one of my writer friends said, “Okay, let’s go with that.” I said, “Let’s go with what?” They said, “Let’s go with nothing.” I said, “What are you talking about?” And he said, “Well, think about it. James Bond, he gets all those gadgets from Q. And Indiana Jones, he’s got the hat and the whip. What if your guy had absolutely nothing?” And there was another long pause, and I thought, “My god, that’s it.”
HOFFMAN: Lee and his writing team quickly began to build on this creative leap in the nothingness.
ZLOTOFF: We send this guy into these missions and these adventures, and he’s got absolutely nothin,g and he’s got to make it up as he goes along. I decided to give MacGyver a Swiss Army knife, and the rest is pretty much history.
HOFFMAN: MacGyver, the hero known for his knack for creating something out of nothing truly personifies the entrepreneurial spirit. When the studio rejected proposal after proposal, it fueled Lee’s creative fire. This saga of MacGyver’s creation mirrors a vital lesson for entrepreneurs: the necessity to thrive amidst rejection and frequent nos. In the entrepreneurial journey, facing rejection is not just a possibility, but a certainty. However, it’s the ability to perceive these rejections not as setbacks, but as stepping stones that sets apart the most successful entrepreneurs.
Each no offers a unique opportunity to refine an idea, sharpen a pitch, and foster resilience. It can even be a sign that your idea is so contrarian that it could be truly transformative. It’s a theory we’ve explored before on this show, and it’s time to revisit why I believe if you’re hearing a chorus of nos, it may actually be a good sign. So don’t be discouraged by rejection. Instead, learn to hear the nuance between the different kinds of no.
TRISTAN WALKER: I don’t know, it’s niche. I don’t think it’s scalable. It was a terrible idea for me to kind of jump into the Bevel thing because it was a consumer group who didn’t want it. An industry that is dominated by the multi-blade use case with billions and billions and billions of dollars to attack you with patent protection, et cetera. And to do it in Silicon Valley, that’s crazy.
HOFFMAN: Since then, I’ve spoken to many other scale leaders for Masters of Scale with their own tails of weathering the chorus of nos, their own strategies for dealing with rejection, and their own perspectives on how encountering the chorus of nos was a vital part of their scale journeys. In this episode, we’ll be hearing from some of those founders. We’ll also be revisiting some more moments from Tristan’s episode. After listening, you’ll no longer be discouraged by rejection and you’ll have a clearer understanding of the nuance between the different kinds of no every founder and leader can expect to encounter.
First, here’s some of the thoughts I expressed on that early episode about rejection and weathering the storm of nos.
HOFFMAN: The lesson for entrepreneurs goes deeper than the pat advice that you shouldn’t take no for an answer. You should expect to take no for an answer. If you’re laughed out of the room, it might actually be a good sign.
The first truth of entrepreneurship and investing is that the very big ideas are contrarian because the contrarian is part of the reason why a bunch of large companies and competitors haven’t already done it, why a bunch of other entrepreneurs haven’t already succeeded at it, so that leaves the space for the creation of something. And to create something big, you have to have that initial space. For example, in the early stages of Google, it was, search is a terrible way of making money in advertising because advertising is time on site. And what does search do? It shuffles you off the site as fast as you can go. That’s not a good business model. So like an Airbnb, it’s like, “Oh, someone’s going to rent a couch or room from someone else? Who are the freaks on both sides of that transaction?” So all of these things have a similar quality.
Very smart people will tell you, there’s no there. So you have to gird yourself for a string of rejections. Some entrepreneurs simply develop thick skin. Others treat it like a normal part of their workday — wake up, brush your teeth, listen to people crush your dreams, it’s a living.
“Gather as many no’s as you possibly can”
HOFFMAN: This is why you need to cultivate a more positive mindset when dealing with that chorus of nos. This is exactly what Abby Falik, founder and CEO of Global Citizen Year did. Her not-for-profit sends students abroad for a year of international service between high school and college. Back in 2008, she was struggling to get funding, and she turned to a leadership coach for advice. We asked her to share that advice.
ABBY FALIK: The nos are actually a gift.
HOFFMAN: You heard that right, a gift.
FALIK: And he said, “Between now and when we talk two weeks from now, I want you to go out into the world and gather as many nos as you possibly can. It is your homework to be rejected over and over and over and over and come back and report on it.” And it ended up being the most important thing I could have ever done and the most important advice I could have been given at that point.
HOFFMAN: The most successful entrepreneurs listen closely to the nos. They mine their rejections for clues.
KATHRYN MINSHEW: I had been turned down 148 times.
HOFFMAN: That’s Kathryn Minshew, Co-founder and CEO of The Muse, a career development website that she pitched to investors 148 times. Not that she was counting.
MINSHEW: There were literally days where I had a no over breakfast, a no over a 10:30 AM coffee, a no over lunch, disinterested at 2:00 PM, somebody who left a meeting early at 4:00. And then I would go to drinks and feel like I was being laughed out of the room. When we finally raised our seed round, I went back and counted. It was both painful and gratifying at the same time, looking at all those names and thinking, “I remember that no. I remember that no. I remember that no.” And they sting. Every one stings.
HOFFMAN: Today, The Muse serves users in the millions. So if you’re hearing a course of nos, you should look for other signs that you’re on to something. I believe that the best ideas often appear laughable at first glance. If you’re really lucky, your idea will be so laughable that it gets its own nickname.
BRIAN GRAZER: It was thought of as the dumbest idea in Hollywood, like, “Stay away from Brian Grazer. He’s got that mermaid idea.”
HOFFMAN: That’s Brian Grazer, one of the most successful Hollywood producers ever and co-founder of Imagine Entertainment, alongside famed director, Ron Howard. Brian has produced a staggering number of hit movies and TV shows including Apollo 13, Frost/Nixon, Friday Night Lights, and 24. And his first big hit was that mermaid idea, better known to us as Splash. As the producer, it was Brian’s job to go and pitch Splash to studios all over Hollywood.
GRAZER: I would tell everybody it wasn’t just a mermaid idea, it was a love story. And love stories, there’s universality to them. But after hundreds and hundreds of nos, I got one person to say yes. And that was somebody at the Walt Disney Company at the time.
HOFFMAN: As we know, Splash was a huge hit, helping propel Tom Hanks to megastar status and getting Imagine recognized as an exciting new force in film. The chorus of nos that Brian endured is an echo of what most entrepreneurs have to endure. It also gave him an important insight into getting his projects made.
GRAZER: The dumbest idea in Hollywood known by all got made and turned out to be a critical darling. And I got nominated for an Oscar and I thought, “Wow, that means nobody knows anything, whether it’s movie story or a tech story or a consumer story.”
HOFFMAN: The parallel with the tech industry is just how do you get something that’s contrarian, but right? And frequently, what I say that in the venture industry is your ideal investment is something that seems crazy right now and totally obvious two to three years from now.
HOFFMAN: No, a lot of people thought it was Bozoville. Both smart people and inexperienced people thought that LinkedIn was crazy. The smart people thought, “Hey, it’s a network product and you’re going to have no value proposition until a lot of people are in it. So no one’s going to join because first person, second person, third person, all no value proposition.” And then the less experienced people were just like, “Well, who wants to do professional networking? Why would that be something? People only want to go meet Bill Gates or someone else. Basically, you don’t know what you’re doing. You’re jumping off a cliff without a plane, without a parachute, it’s going to be ugly.”
The rejection that Katia Beauchamp faced when pitching Birchbox
HOFFMAN: Your vision may seem obvious to you, but there could be any number of reasons why others haven’t seen it.
And in getting people to come along, the first step is to understand why they’re unable to see what you see. Katia Beauchamp introduced a new business model that flipped the beauty industry and influenced a slew of other industries. Her company, Birchbox, sends out a monthly box of beauty product samples to its subscribers. Customers can then buy full-size versions of the samples and many other beauty products through Birchbox’s online store. Katia’s vision for how this new business model could transform the entire beauty industry seemed obvious to her. But when Katia and her co-founder, Hayley Barna, came up with the idea in late 2009, they struggled to get anyone else to share that vision. First, Katia and Hayley went to their business school teachers with the idea.
KATIA BEAUCHAMP: And they were like, “Aw, that’s a bad idea.” And started pitching brands and similarly, brands were kind of like, “You’re so naive.”
HOFFMAN: So they took their pitch to a group of people they thought would get their vision: angel investors.
BEAUCHAMP: It was so disheartening. Everybody took the meeting. Most people weren’t listening. The ones who were just started thinking about how they would do it, “Does it need a box? Do you need to send it together? Can you send one at a time every week? My wife doesn’t use beauty products, what about her?”
HOFFMAN: This is where it’s important to know not just what your vision is, but who you are pitching to and how you can help them to see it.
BEAUCHAMP: We thought, “This is legit,” but we couldn’t get anybody to really take the leap. Everybody was looking for somebody else to validate it first.
HOFFMAN: The idea wasn’t hard to understand. However, this was 2010. People were not used to having multiple monthly subscriptions. Just one or two subscriptions felt like a real commitment. On top of this was the fear of the untested. Katia and Hayley just couldn’t get these investors to share their sense of surprise and delight at having a curated box of samples arrive at their houses each month. But to them, it was so obvious, so they needed to find another angle to describe it.
So when you did the pitches to these early investors and the investors said no, what was your conclusion from those nos? What learnings did you take away? What did you think?
BEAUCHAMP: It was a range from, “Too bad for you. You’re going to miss something huge,” and a little bit more self-actualized realization of, “I think I need to consider how to say it differently because I don’t question the idea, but maybe the message isn’t right. Maybe I’m not framing it right.”
HOFFMAN: Note how Katia was unwavering in the faith in her idea. She could have put the refusals down to a lack of vision on the part of investors, and this is a valid approach up to a point. What is so smart about Katia’s approach here is how she imagines herself as the investor because she’s not only imagining what they’re looking for in a company or a founder, she’s also imagining how their preconceptions and prejudices shape their judgment. She had to make her vision seem obvious to them.
BEAUCHAMP: We shifted a lot more to the TAM, total addressable market in beauty, the fact that it was underpenetrated on the internet, and just tried to start speaking the language of, irrefutably something is going to happen here because 2% penetration on the internet for beauty in 2010 is definitely not going to be where it sticks.
HOFFMAN: This approach got VCs on board and solved Katia’s funding problem. Once the Birchbox model caught on, it rapidly spread through the beauty industry and beyond and created a whole new approach to sales. Now, you can get sample boxes for anything from pet treats to underwear. Sometimes you need to finesse your pitch like Katia did, but sometimes you just need sheer persistence. That’s what John Foley, co-founder and former CEO of Peloton, discovered when he first started pitching his idea to investors.
How Peloton’s John Foley converted skeptics
JOHN FOLEY: I don’t know, Reid, I don’t know what I could have done differently. I think I’m a pretty good salesman. I believe so passionately in what we’re doing and I still do, and I was explaining it as best I could. I had a 10 out of 10 business on a silver platter, going to strategics, going to angels, going to venture capitalists.
HOFFMAN: John envisioned a connected stationary bike that would deliver live classes to the home. He thought he would cruise to an easy victory with his 10 out of 10 idea, but it turned into an epic uphill climb.
FOLEY: Here I was, I have 15 years of tech leadership experience. And I was sure that venture capitalists were going to throw money at me because it was such a good idea and I was an experienced guy.
HOFFMAN: And what was your experience like, because that was clearly the dramatic buildup for the, “But instead…”?
FOLEY: But instead, three years later, after pitching hundreds of venture capitalists and thousands of angels, I hadn’t raised a dime of money from an institution.
HOFFMAN: Fans of Peloton know all about tough climbs, but this was a hill so steep, John couldn’t see the top. Every investor was a skeptic and they all had different ways to say no.
FOLEY: There were 10 or 12 buckets of nos. It was my age. Half of the VCs didn’t like hardware at all. Fitness was a dopey category plagued by bad teams and bad products and bad marketing and gimmicks and fads. A lot of people in the Valley didn’t understand boutique fitness. Oh, you’re a New York City company. I’ve made a commitment to my family that I’m only to sit on boards in California. No investors wanted to look at this thing. They wanted nothing to do with it.
HOFFMAN: John took hundreds of nos from venture capital firms, thousands from angel investors as he tried to fund his 10 out of 10 idea. The prototype was still in its early phase, the network of users not yet built, so John couldn’t yet ask a funder to hop on a Peloton and take a spin. He had to convert skeptics on the power of story and vision alone. He described a network of home writers, thousands per class, pedaling away at the same time to the same live instructor and a gamified leaderboard system. And the best part was, no one else was doing it. John leaned into that pitch and one by one he won over a few early believers, angel investors going in for blocks of 25 or $50,000 at a time. Those investors included John’s brother-in-law, his co-founders, and John himself. Every check mattered. Each one strengthened his resolve and built Peloton some runway to prove their case.
FOLEY: Three years later, I had a hundred checks from a hundred angels that amounted to roughly $10 million and that’s how we capitalized the first three years of Peloton.
HOFFMAN: After a thousand pitches, John had gotten really good at painting his vision. What was missing was a way to be more selective in his targets. Some skeptics will simply never be moved, others will only be moved when they see the data. So discerning which are movable becomes its own invaluable skill. How do you do this? Just by asking what does this person value above all else? And am I offering something that speaks to that value? When you pitch a mainstream investor, they value a sure thing. They want you to look like every other deal they’ve seen succeed. When you pitch an eccentric VC, and of course, I consider myself one, they value ideas that are contrarian, the ones that don’t look like every other deal. John and his team ultimately converted skeptical doubters into diehard believers and then rode their enthusiasm all the way over the hill.
After the break, we’ll hear how to tell a truly bad idea from a bad sounding idea, how to deal with insurmountable nos from unexpected quarters, and the importance of saying no yourself.
HOFFMAN: We’re back with a special remix episode of Masters of Scale, revisiting my theory that if you’re hearing a chorus of nos, it may actually be a good sign.
Tristan Walker on dissecting the quality of rejections
So how can you tell a truly bad idea from a bad-sounding idea? How can you be sure your ugly duckling could become a swan? This is the key, you have to pay attention to the quality, not the quantity of rejections. You want to see at least a teeny minority of investors squirm. You don’t have to get them to a yes, but you should detect some friction as they reason their way to a no.
WALKER: A lot of people say that they’re trying to build the Procter & Gamble for people of color. Let me talk about this for a second because it’s really funny. Number one, I’ve never said that. And then two, it was interesting, I think folks talk about it as if it’s a niche kind of thing, but people of color are the majority of the world, so if we’re the Procter & Gamble for people of color, what the hell is Procter & Gamble?
HOFFMAN: That’s Tristan Walker, the founder and CEO of Walker & Company. He re-engineered the single-blade razor, specifically for coarse or curly hair. He called it the Bevel and it became the flagship product for Walker & Company and the first step in his grand plan. He envisioned a health and beauty company on par with global brands like Procter & Gamble, a company that devoted its attention to men and women of color. It was blindingly obvious to him that this company should exist. But when you’re pitching a room of mostly white, mostly male investors, it can be hard to convey the urgency of this market oversight. So how did the best and brightest VCs respond to Tristan’s idea?
WALKER: I don’t know, it’s niche. I don’t think it’s scalable. It’s a terrible idea for me to jump into the Bevel thing because it was a consumer group who didn’t want it. An industry that is dominated by the multi-blade use case with billions and billions and billions of dollars to attack you with patent protection, et cetera. And to do it in Silicon Valley… that’s crazy.
HOFFMAN: Tristan has a keen ear for this quality in his conversations. He can pinpoint, down to the PowerPoint slide number, the moment his audience stops paying attention.
WALKER: I had a slide in there. I think it was like slide 14, where I talked about Proactiv, the acne system, as a good analogy to what we’re trying to do. It’s a difference between Gillette and Bevel as Neutrogena and Proactiv. It’s a system, it solves a very important issue. And this VC looked at me and I’ll never forget this, said, “Tristan, I’m not sure issues related to raising bump shaving irritation are as profound and big an issue for people as acne.”
At which point I said, “I kind of understand what you’re saying, but all you had to do is get on the phone with 10 black men and eight of them would’ve said this is a permanent thing I have to deal with. All you have to do is get on the phone with 10 white men and four of them would’ve said the same thing. Could have done it for women too, and you would’ve got the same ratios.” So it wasn’t that it was a bad idea or not as important, it was just that that person was unwilling to acquire the context necessary to understand what we’re working on. That’s just laziness. And at that point, I can’t fix that, so I just got to move on until I find somebody who understood it.
HOFFMAN: Notice how quickly Tristan’s mind moves on to the next investor? When the quality of the questions drops, he knows mid-pitch that the conversation’s over, the rest is noise. Those half-hearted questions are like the elevator music of the pitch process. It’s meant to pacify entrepreneurs. In fact, it grates at them. It also wastes their time. Tristan will tell you he prefers a hard no to a comforting maybe.
WALKER: Silicon Valley investors will tell you all the time, “We want to invest in people who can execute with some symbols of pedigree chasing a significant white space and a big opportunity.” For us, it was like check, check, check, check. And we heard 99% nos. It’s like, “How much of this is ****, right? And you just trying to say something that I want to hear as opposed to telling the truth.” And I wish that Silicon Valley would tell the truth a little bit more.
HOFFMAN: Tristan raises a really interesting question here. How much of this investor hemming and hawing is, well, ******? So what’s really going through their heads? As a partner of Greylock, I want to share what happens after an entrepreneur leaves the room. An investor is left to mull over a crazy idea. It begins with a debrief of the investor’s partners. If I’m presenting an idea to my partners at Greylock and they all go, “That’s great, we should do that.” I’m like, “**** here’s a bunch of hyper-smart people, and no one’s saying, ‘Oh, watch out for this or watch out for that.'” It’s too easy. The idea is so obviously good. I can already hear the stampede of competitors trampling over our hopeful little startup. On the other hand, you don’t want every person in the room to say, “Reid, you’re out of your **** mind,” because then you’re wondering, “Am I drinking the Kool-Aid in a very bad way?”
What you want is some people going, “You guys are out of your minds,” and some people going, “I see it.” You want a polarized reaction.
In fact, the one piece of advice I give most often to early-stage entrepreneurs is to go out and ask the smartest people you know, “What’s wrong with my idea? Why won’t it work?” I asked this question when I was first building LinkedIn and my most trusted advisors had the same answer. They said, “The problem would be in getting the network flywheel going.” After all, a professional network is only valuable if other people are there to network with. This response didn’t make me say, “Okay, never mind.” Instead, it showed me what my number one obstacle was going to be. Asking smart people what’s wrong with your idea is the best deal on data you’ll ever get. But what happens when you gather together thousands of smart people, give them a lovingly crafted introduction to your product, and then they all yell no in unison?
Alexa von Tobel, founder and Managing Partner at Inspired Capital, experienced exactly this when she was launching LearnVest. Founded in 2008, LearnVest was a proto FinTech platform that offered money management resources, from budgeting bootcamps to spending trackers to consultations with human financial planners. When they were acquired by Northwestern Mutual in 2015, it was a clear sign that the FinTech era had arrived. It was September 2009 and LearnVest had been invited to launch their closed beta at the TechCrunch50 conference. Alexa can set the scene.
ALEXA VON TOBEL: They fly you out, you get to get on stage, 3,000 people, and by being selected, it’s because you’re one of the best and biggest ideas. So you get to go on stage and present. I was so nervous. I’d emailed everyone I could think of to be like, “We’re going to launch the business, come watch it. It’s going to be live-streamed.” So all my family, all my friends are watching from afar. I get on stage and I start talking about how the future of the wallet’s going to come online. It’s going to be on your phone.
You’re going to have access to advice. There’s going to be gamification. You’re going to be able to, almost in a way that doesn’t feel like work, learn and interact with your money. In my head, I’m like, “I’m going to win an award.” And the panel of judges, Reid, were like, “This is the worst idea I’ve ever heard.” They shredded the idea live and basically said, “People aren’t going to trust bringing their money online. The gamification just seems stupid. No one’s going to be interested.” The primal brain in my head was like, “Oh my God, this was not how this was supposed to go.”
HOFFMAN: Alexa had hoped for some constructive advice or perhaps admiration and more investment. Instead, the advice she got was, “Maybe don’t bother.” Alexa defended her idea to the judges and the assembled crowd.
VON TOBEL: I just sat there and was like, “Well, first of all, 80% of the country lives paycheck to paycheck. Nobody has money. Retirement, we’re going to live an extra decade longer. It’s a massive problem for the country. We have to figure it out.” And I just went into all of the work I had already done and spewed it out of my brain and ended up getting a standing ovation. People were clapping, which was great, but I got off the stage, went into a closet, and literally started bawling. I called my boyfriend, who’s now my husband, Cliff, and I was like, “I don’t know what just happened, but they hate the company. They hate the idea.” It wasn’t TechCrunch, it was tech-punched. I literally got tech-punched.
VON TOBEL: I kind of just went into all of the work I had already done and ended up getting a standing ovation.
HOFFMAN: The judges didn’t see LearnVest’s potential, but the audience did. And when LearnVest officially launched, less than four months later in January 2010, the site got 50,000 signups in the first month.
VON TOBEL: That was when I was like, “There is something here. People do want to learn about this,” and then we raised lots of money. Then life got easier.
Princess Reema on advocating for women’s empowerment in Saudi Arabia
HOFFMAN: However, sometimes you’ll face something more implacable than a chorus of nos, a seemingly impenetrable wall of nos. Her Royal Highness, Princess Reema Bint Bandar Al Saud, faced just such an obstacle. Princess Reema is a member of the Saudi royal family and Saudi Arabia’s ambassador to the United States. But before that, she was a CEO, an entrepreneur, and an advocate for women’s empowerment in Saudi Arabia.
PRINCESS REEMA BINT BANDAR AL SAUD: I grew up in the States. I arrived in the States, I was seven years old, and 30 with two children when I went home. And I recognized that the experiences I had when I was younger weren’t available to my children. I fell into the world of business because of the word no. And the no was, women can’t be employed. And I couldn’t understand that. I said, “What do you mean?” So I had to sit and think and recognize, I’m a woman born of privilege. I’m born into a royal family, I’m born into the ruling family, and I couldn’t get a job. So what is then the state of women and every other woman and how many other women are being told no, but don’t have opportunities? But I had an opportunity to make that shift, to make that pivot and try to use skills that I had learned to tell another story.
So I tried to do that. I was hired into the Ministry of Sports and I was told that my mandate was female inclusion. And I said, “That’s great, but do you mean myself sitting in an office and we tick a box or do you mean that we actually have a mandate to create change for female inclusion?” I was told, “No, it’s a mandate.” Fabulous. The only issue was, there was no offices. So I actually worked from home for the first year. I would go to the ministry and there’s no bathroom. So I was lucky that my home was five minutes away. That’s still just not convenient. So we used to put a sticker on one of the bathroom doors with a little female sign, and we’d come back every day and it would be removed, and then we’d put it back. And then, not to be crass, but we put ladies products in the bathroom and they never took the sign off again. We were like, “All right, we got you.”
So I was hired to push the envelope. I was hired to make change. I was hired to push back on either the stereotype that we had for ourselves or the limiting beliefs that we had for ourselves or the boundaries that we were always told no, because I was told there is no, no. We took four women as wildcards to the Olympics. FYI, at that time, no facilities for women in sports. So they actually ended up doing their bootcamp in my home. They trained in my home gym, they stayed in my parents’ guest house because we just needed to get it done, get it done before somebody says no because once you break the ice and you take that first step, it is what it is, it’s precedent.
And I will tell you that the women of my country today are leaders. They’re CEOs. 40% of all small and medium-sized businesses are women today. Not a true statement five years ago. Women are in the military, women are in leadership positions in government. We have deputy ministers and vice ministers. The challenge for women in my country today is no different than the challenge for women in your country. And the limiting belief that we hold ourselves to, is what will hold us back, not the limiting beliefs other people have.
HOFFMAN: I couldn’t agree more with Princess Reema’s strategy here. When faced with a huge, all-barring societal no, she looked for ways to set a precedent that would lay the basis for a huge scale change down the line. Now I want to take some time to consider how and when you should say no. How do you tell when your no is helping you avoid a bullet and when it’s dooming you to miss a huge opportunity? This is something I spoke about with model, producer, and entrepreneur, Tyra Banks.
Tyra Banks on saying no to opportunities that aren’t right
Part of maintaining a firm handle on her personal brand was learning when and why to say no. Why, for the same reason, it’s important to say no when making decisions for a corporate brand because with focus comes clarity of purpose. Try to be everything to everyone, you’ll end up standing for nothing.
TYRA BANKS: So one of the things was time. There’s only so much time in a day to do so many things. And then a lot of things I said no to because of beliefs.
HOFFMAN: Which beliefs? What mission and so forth?
BANKS: So I was offered millions of dollars to wear furs. I’m not the person that’s throwing paint on people, but I just don’t want to wear furs, right? Real fur. Millions of dollars to sell alcohol. I always said no to that. I did one drink responsibly campaign, but I was like, “It has to be a drink responsibly campaign.” My grandmother died of lung cancer when she was 50 years old, so I said, “No cigarettes.” So those were my three main categories of no, and also the three main categories that paid you the highest. So I always would say no. And my agents are like, “Are you serious? Do you understand what you can make in four days is what you can make in four years?” I’m like, “I know, but I’m just not going to do that.” But through that, there was just so many nos. Oh Lord, Reid, there’s so many that I look back on and I feel, as precious as I was about personal brand, I think there was a lot of protection there, but I think there was a lot of dumb nos.
HOFFMAN: What are one or two of those that you most regret?
BANKS: One of the top magazine companies, they came to me and wanted me to do a magazine, how Oprah has her magazine, how Martha Stewart has magazines, Rachel Ray has magazines, and they wanted me to do a magazine. I remember being in that meeting with these 12 people in this huge beautiful conference room and me saying, “I don’t have time for that. I’d have to look at every single page and approve it myself. And I’m hosting my modeling show and I’m doing this and I just don’t have time.” I didn’t understand that true leaders, they’re the visionary, but they don’t have to do every damn page and do the type setting and the whole… I just felt I needed to be so close and I said no to something that I think would’ve been extremely beautiful, powerful in the way that I see power of giving knowledge. So I think that was a huge mistake. Of course, magazines are hurting right now. Today, it would’ve been an online community, but I think that was a huge mistake.
For another case study in a no, that felt like it could have been a huge mistake, let’s hear from Dropbox founder, Drew Houston. In this story, Dropbox had just started to rapidly scale, and it was attracting attention from the tech giants, including Apple’s Steve Jobs.
DREW HOUSTON: We got the invitation to see Steve, and I was not expecting that. So I remember we get in our zip car and I’m typing in one infinite loop…
PHONE: Getting directions to Apple Campus.
HOUSTON: And I’m like, “Oh, great, it’s already in my iPhone.”
HOUSTON: So we get down there, and I remember going to the sign-in thing and being like, “What do we say? Okay, we’re here to see Steve.” They’re like, “Okay, have a seat.” And we’re like, “Oh God, maybe he hasn’t seen the product.” So Arash and I had this elaborate demo ritual, so we’re furiously trying to configure. But of course, it occurs to us two minutes before the meeting, to set up our computers to do all the incantations to make the demo thing work. But we get up there and we have a seat, and then Steve comes in and has a seat, and he leans back and there’s this massive pause and he’s like, “Where to begin? You guys have a great product.”
And I’m under the table. I’m like, “All right, bucket list, Steve thinks our product is great.” And then in so many words, he’s like, “And you should really join us because we’re a startup with infinite resources,” and goes through his pitch. And before this, I was a little bit terrified. I talked among my friends who had had their Steve encounters, and they fell squarely into two categories. You get chill Steve, or I’ll just call him, mean Steve, and you never know which one you’re going to get. So he finishes his pitch of why we should join Apple. And I’m like, “Oh boy, here we go.” I’m like, “Steve, I really admire everything you’ve done, and if there’s any way we could find to work together, I totally would love to, but we’re really enjoying building this company and we want to keep going. I’m sure you understand.”
And I didn’t know if he was going to start throwing stuff or if there would be an explosion or lightning bolts or whatever. And then what happened was he just started trolling us a little bit. He’s like, “Okay, you guys are a feature not a product, and you’re not going to be able to get distribution, and you have to pick partners, and that’s going to be really risky. And oh God, we’ve got our own thing, and I guess we’re going to have to build that and kill you, and dah, dah, dah, dah.” So my two goals were like, “Leave a good impression and don’t piss them off.” So I’m like, “All right, well, agree to disagree.”
HOFFMAN: While most founders would take a threat of extinction from Steve Jobs as a showstopping obstacle, Drew took it as a vote of confidence. Unfortunately, few leaders of large companies are visionaries. Some are happy to ignore smaller companies encroaching on their field until it’s too late. Shellye Archambeau, former CEO of MetricStream, saw this firsthand when she joined Blockbuster to head up its online operations. At the time, it was a giant of movie rental.
SHELLYE ARCHAMBEAU: So here I am at Blockbuster and my job is to build blockbuster.com. They had started to build a website, et cetera, but we had to get a website launched. We had to figure out, what were our services going to be. It was really building a business and building a whole team. So as I’m learning the industry, I’m going to conferences and I meet Reed Hastings. Reed, with a couple others, has started Netflix. And at that point, it’s pretty fledgling.
HOFFMAN: Even though it was early days in the Netflix story, Shellye could see the huge potential. Unfortunately, her boss could not.
ARCHAMBEAU: We got to know each other. And Reed said, “Listen, we talked about it.” Reed came out to Blockbuster and pitched, “Let’s take blockbuster.com, the brand, let’s take Netflix, the technology, put them together and spit it out and have blockbuster.com, Inc.” And I’ll never forget, my boss, the CEO at the time of Blockbuster, he just sat back and said, “Ah, if that ever becomes anything, we’ll just buy it.” Because Blockbuster was a big business at that time. And I’m sitting there thinking, “What? Are you crazy?” And that’s when I knew that this was just not the place for me to stay. They just didn’t have the vision. And history is written. Blockbuster is long out of business, and Netflix is one of the top brands in the world.
HOFFMAN: Blockbuster said no thanks to Netflix for the wrong reasons. But Drew said no to Steve Jobs and his passive-aggressive offer for the right ones.
That brings us to the end of the special remix episode of Masters of Scale. The nos have been flying at us thick and fast, but so has the inspiration for how to deal with all manner of rejection. This understanding isn’t just about resilience. It’s about knowing how and when to use a chorus of nos to catalyze innovation, pivot strategically, and fuel your determination to succeed in the face of adversity.
I’m Reid Hoffman. Thanks for listening.