Speaker 1: This is Master's in Business with Verry Ridholts on Bloomberg Radio.
Speaker 1: This week on the podcast, I have an extra special guest.
Speaker 1: His name is Safi Pacall and he is the author
Speaker 1: of a fascinating book called moon Shots. Not only was
Speaker 1: he on President Obama's counsel on the Future of Technology,
Speaker 1: but he has consulted for the CIA, the Navy, all
Speaker 1: sorts of organizations, teaching them how to nurture innovation in
Speaker 1: institutions that normally are not very good at that sort
Speaker 1: of thing. He's really a fascinating guy background in physics,
Speaker 1: ran a biotech company and along the way picked up
Speaker 1: lots of insights into what leads to successful moon shots
Speaker 1: as projects and why so much innovation is really just
Speaker 1: smothered in the lab, smothered in the cradle, when it
Speaker 1: has potential to literally change the war. The radar is
Speaker 1: argued with the technology that won the war for the Allies.
Speaker 1: It had been sitting in the Navy for eighteen years unused,
Speaker 1: and had it not been discovered and brought forward by
Speaker 1: van Ouer Bush and other people, there's a very real
Speaker 1: chance the global map would look totally different. So I
Speaker 1: think you'll find this conversation to be absolutely fascinating. My
Speaker 1: conversation with Safie Picoll. This is Masters in Business with
Speaker 1: Barry Ridholts on Bloomberg Radio. My extra special guest this
Speaker 1: week is Safie Picall. He is the former CEO and
Speaker 1: co founder of Sense of Pharmaceuticals. He served on President
Speaker 1: Obama's Council of Science Advisors, and he is the author
Speaker 1: of loon Shots, How to Nurture the crazy ideas that
Speaker 1: wind wars cured diseases and transformed industries. Sofie Picall, Welcome
Speaker 1: to Bloomberg. Thanks very glad to be here. So you
Speaker 1: have a really fascinating background. Both your parents are physicists
Speaker 1: or astrophysicists. You eventually go to Harvard, get a degree
Speaker 1: in theoretical physics, go to Stanford for your PhD in physics.
Speaker 1: How on earth does that lead to a career in
Speaker 1: in biotech. I was kind of a little bit of
Speaker 1: a random walk, but I I spent probably the first
Speaker 1: thirty years of my life kind of on a university.
Speaker 1: And because my parents were physicists, we grew up in Princeton,
Speaker 1: and then I was college and then grad school and
Speaker 1: then post doc and going through the faculty stuff. And
Speaker 1: at some point I realized, and this might be a
Speaker 1: little shocking, that more than that people are not in
Speaker 1: the world, are not theoretical physicist or mathematicians. They do
Speaker 1: stuff other than write papers and go down for inces.
Speaker 1: And I just got curious, So you started looking around.
Speaker 1: How do you go from theoretical physics to stumble into
Speaker 1: via random walk biotech. I was just curious about what
Speaker 1: is it that makes the world go round? And what
Speaker 1: do other people do when they're not writing pay person
Speaker 1: about mathematics or physics. And I actually remember I was
Speaker 1: dating a woman at the time and she had she
Speaker 1: was working as a paralegal, which was a real job,
Speaker 1: and I'd never been to an office, and I remember
Speaker 1: asking her, could you take me in? I was in
Speaker 1: my mid twenty Could you take me into this thing
Speaker 1: you call an office? Did it horrify you? Well, I
Speaker 1: remember she said, well, listen, I can take you in
Speaker 1: Friday happy hour. That's when people sort of stand around
Speaker 1: you could talk. And so I came in Friday happy
Speaker 1: and I said, I said, well, what should I ask?
Speaker 1: And I said, well, look, are you happy doing what
Speaker 1: you're doing? And I went around. It was actually a
Speaker 1: well known law firm in Silicon Valley, and I said,
Speaker 1: are you happy doing what you're doing? I would say,
Speaker 1: of the twenty five people I asked, twenty five said no.
Speaker 1: And I was like, well, that probably set me back
Speaker 1: another five years in the academic world. But I just
Speaker 1: got very curious. And so I heard from another physicist
Speaker 1: friend who had gone into a consulting world, and they
Speaker 1: had sort of they help you transition, they kind of
Speaker 1: from academia to business. Yes, so I went to a
Speaker 1: consulting firm in New York called McKenzie and Joint Company,
Speaker 1: always in the news, US in the news a lot lately,
Speaker 1: and it's kind of like a halfway house for academics.
Speaker 1: It's sort of like they don't want to let you
Speaker 1: loose on the real world, and they sort of coach
Speaker 1: you and the skills you need to survive, how to
Speaker 1: speak to people, how to work on teams, how to
Speaker 1: solve real problems. And so that's how I got a
Speaker 1: sense of kind of how the real world works. And
Speaker 1: then I got a taste for wanting to do something,
Speaker 1: build something, and also bigger than myself, bigger than you know,
Speaker 1: your your own career or your own papers. Or your
Speaker 1: own ideas and bigger than just advising companies. Uh. You know,
Speaker 1: I had friends whose parents were getting sick. I was
Speaker 1: going through some illness in my own family, and I thought,
Speaker 1: how motivating would it be if when I woke up
Speaker 1: in the morning, I was working in something that could
Speaker 1: give people on Earth more time with their loved ones.
Speaker 1: It's just an incredibly exciting and fun way to work. So,
Speaker 1: you know, some part of that is you want to
Speaker 1: do some good, but some part of that is selfish.
Speaker 1: It's a great way to motivate yourself and others. So
Speaker 1: that's really fascinating. So you decide you want to participate
Speaker 1: in something more than just a narrow, little research niche
Speaker 1: that has bigger ramifications for friends, family, society, the whole world.
Speaker 1: So from nine you're in Mackenzie. By two thousand and
Speaker 1: eight your name the Ernstein Young New England Biotech Entrepreneur
Speaker 1: of the Year. What took place in that decade between
Speaker 1: Mackenzie and winning that award, Well, a lot of learning.
Speaker 1: So when I went to start a company after a while,
Speaker 1: I really wanted to start something of my own, and
Speaker 1: I found that I was There was a niche which
Speaker 1: is where scientist I would talk to in the lab,
Speaker 1: or biologists or chemists really enjoyed talking to me because
Speaker 1: I wasn't actually one of some enemy camp for a biologist,
Speaker 1: I wasn't a chemist. For chemist, I wasn't a biologist.
Speaker 1: As a physicist, you're sort of like Switzerland, your neutral,
Speaker 1: and everybody is sort of intrigued and talking to you,
Speaker 1: and you can ask everybody interesting questions and learn and
Speaker 1: it's kind of fun. And I found that I was,
Speaker 1: on the one hand, good at having those discussions and
Speaker 1: getting those people fired up about a big goal. On
Speaker 1: the other hand, I was also good at talking to
Speaker 1: people in the finance community. My mother's Israeli. I lived
Speaker 1: in Tel Aviv and we grew up a little bit
Speaker 1: in Israel, and so talking to traders and investors is
Speaker 1: not much different than walking around a shook in Jerusalem
Speaker 1: or Tel Aviv. People are very focused on the immediate,
Speaker 1: what's the bottom line, How is this gonna help me?
Speaker 1: And I found I could bridge those two worlds pretty well,
Speaker 1: and that was actually pretty interesting. And there were all
Speaker 1: these ideas that seemed to be trapped in the lab.
Speaker 1: They could help people, and they were stuck because there
Speaker 1: was no bridge between those two words you mentioned, trapped
Speaker 1: in the lab. There's a chapter and loon shot that
Speaker 1: I love this heading, Engineers of Serendipity. How do people
Speaker 1: in that line of work R and D research labs?
Speaker 1: Why are so many great discoveries, so much fascinating innovation
Speaker 1: and discovery? Why does that stay trapped in a lab? Well,
Speaker 1: you see this all over the place, and we're talking
Speaker 1: a little bit about biology and biotech or research companies,
Speaker 1: but the same thing is true in tech companies and
Speaker 1: engineering companies and product design companies. And the last few months,
Speaker 1: I've actually spent a lot of time with the Department
Speaker 1: of Defense and national security organizations, all of whom have
Speaker 1: the exact same question. Why do good teams keep killing
Speaker 1: great ideas? Why are all these promising things stuck in
Speaker 1: the lab? And part of that is there isn't this bridge.
Speaker 1: There isn't the bridge between those who are focused on
Speaker 1: the core on how do I improve my operations and
Speaker 1: my execution and those who are working on the new
Speaker 1: and that because of two people. There the two types
Speaker 1: of people who work on those things speak different languages,
Speaker 1: They don't understand each other, and they often don't like
Speaker 1: each other. I'll give you an example. So I was
Speaker 1: meeting with the admiral who's responsible for transforming the Navy
Speaker 1: for the twenty first century, and so I was standing
Speaker 1: on a nuclear submarine about thirty ft from the nuclear
Speaker 1: or engine. And this is exactly what's on their mind,
Speaker 1: what was on his mind and his team's mind. If
Speaker 1: you are a hundred miles from shore, deep underwater, you
Speaker 1: don't want to start hearing clanking noises from your nuclear engine.
Speaker 1: That's the core. But at the same time, you don't
Speaker 1: want to be surprised by a new kind of torpedo.
Speaker 1: That's the new. So for companies, for organizations, for teams,
Speaker 1: it's a matter of p and L. You don't want
Speaker 1: to be surprised by your competitor. But for national security
Speaker 1: organizations it's a matter of life and death. But it
Speaker 1: all comes back to that same question, how do we
Speaker 1: balance the core and the new Why do we keep
Speaker 1: having these battles between here these promising ideas and here
Speaker 1: are these people who are shooting them down? And what
Speaker 1: can we do about it? And so that's behind some
Speaker 1: of the research that led to the loon shots and
Speaker 1: loon shots is all about the dichonomy between the franchisees
Speaker 1: and the innovators. Will continue discussing that shortly. So let's
Speaker 1: talk about the early two thousand's when you were launching
Speaker 1: Center UH and up a little bit. How did you
Speaker 1: meet your co founder and partner? Well around the time
Speaker 1: that I was getting kind of antsy, as after a
Speaker 1: few years as a consultant, I wanted to do something.
Speaker 1: I knew that I wanted to work on helping get
Speaker 1: those promising ideas out of the labs and into the
Speaker 1: real world. And so I spent maybe six months, maybe
Speaker 1: a year, going around universities academic labs where I had
Speaker 1: some connections and talking to promising scientists, and one thing
Speaker 1: led to another. Encountered this guy at Harvard at Dana
Speaker 1: Farber Cancer Institute who just was sitting on like this giant,
Speaker 1: you know, untapped mind, really interesting, really promising ideas, And
Speaker 1: I thought, this is a guy who would be fun
Speaker 1: to partner with. And a lot of people, you know,
Speaker 1: listened to him but just missed all this stuff that
Speaker 1: that he was sitting on, not only him, but people
Speaker 1: he collaborated with. So I decided to partner with him
Speaker 1: and start a new company. And this is landbou chan So.
Speaker 1: In the book, there's a fascinating discussion about the broad
Speaker 1: approaches to looking for a drug to either pure disease
Speaker 1: or manage a disease. And one approach is to work backwards.
Speaker 1: We try and figure out what the mechanism of the
Speaker 1: disease is and find something that halts that mechanism. But
Speaker 1: there was another approach, which was people have invented thousands
Speaker 1: upon thousands of different molecules. Let's just run these molecules
Speaker 1: against all these diseases and see what they do. That
Speaker 1: seems to be his approach, Am I am I getting
Speaker 1: that correct? Yeah? He was. I mean, there's a combination
Speaker 1: of two and if you actually just pick one or
Speaker 1: the other, you will do less well. So if you
Speaker 1: start with, well, here's how the protein works, here's what
Speaker 1: it does in the cell, and here's what we need
Speaker 1: to get done. Let's put that on a computer. It
Speaker 1: sounds very logical. It tends to go very badly, really,
Speaker 1: because people don't realize how important serendipity is in drug discovery.
Speaker 1: Almost all of the major drugs and the vast majority
Speaker 1: of the major breakthroughs that we have in science, but
Speaker 1: but especially in drug discovery, there's always some element of
Speaker 1: serendipity because the body is so much more complex. What
Speaker 1: works in a cell dish or what works in a
Speaker 1: academic paper that you published and submit to prestigious journal
Speaker 1: very often is completely different, sometimes exactly the opposite of
Speaker 1: what works in a giant, complex system in a very
Speaker 1: difficult environment. And so I think what I liked about
Speaker 1: his approach and what resonated and the people that he
Speaker 1: worked with in our approach was that we did both.
Speaker 1: We looked on the one hand for the underlying science
Speaker 1: and the rigor, but on the other hand, we balanced
Speaker 1: that with an understanding of how important serendipity is and
Speaker 1: how important surprises are. And one of the things I
Speaker 1: found really fascinating was the approach, and this was in
Speaker 1: particular with cancer, of not just trying one thing that
Speaker 1: might work, put the disease into remission, and then the disease,
Speaker 1: I don't know if it's evolution or just adaptation, eventually
Speaker 1: comes back because it's figured out how to overcome whatever
Speaker 1: that obstacle is. You write in the book about how
Speaker 1: a one to three four approach left hook, right jab,
Speaker 1: an operacot throwing enough stuff at a particular disease not
Speaker 1: only knocks it out, but it prevents it from adapting
Speaker 1: to whatever that therapy is discussed that a little bit.
Speaker 1: I mean, you can imagine it by example with a
Speaker 1: military and sort of a terrorist. Let's you have a
Speaker 1: city that seems to be taken over by terrorists. If
Speaker 1: you have just one approach for how you're going to
Speaker 1: go fight those terrorists, Let's say it's a sniper, or
Speaker 1: it's an air attack or it's a drone attack, they
Speaker 1: will adapt. They will figure out a way to hide,
Speaker 1: they will figure out how to evade that particular angle.
Speaker 1: And so if you want to succeed, you need a
Speaker 1: shock cannot You need to use the army. You need
Speaker 1: to use the air force, you need to use the navy.
Speaker 1: You need to use drones, you need to use snipers,
Speaker 1: you need to use cyber You have all of them
Speaker 1: at once in order to completely wipe it out. And
Speaker 1: it's the same thing with cancer. Cancer is a rogue
Speaker 1: set of cells operating in your body. They're just growing
Speaker 1: out of control. There is an accelerator pedal that's stuck
Speaker 1: and so it just broke, and there's a brake pedal
Speaker 1: that halts the growth that also broke. That's why cancer
Speaker 1: takes decades to develop. You have to have all these
Speaker 1: systems just break down, whether it's with time or because
Speaker 1: you smoke and you're you're you're messing up the cell
Speaker 1: with the carcinogens and smoke. It takes time to accumulate
Speaker 1: these failures. And after the first break system fails and
Speaker 1: the second break system and the backup system fails, and
Speaker 1: this cancer cell starts growing and doubling and growing and doubling.
Speaker 1: And you can't just attack it with just the army
Speaker 1: or just the navy or just the air force. You
Speaker 1: need to come at it from all directions at the
Speaker 1: same time, and then you have a chance. The few
Speaker 1: cancers that we've cured, and there's a small handful of
Speaker 1: cancels that we've cured, that's what we've done. It's almost
Speaker 1: always some combination and shock attack, and it's the right
Speaker 1: combination at the right time that can actually overwhelm the
Speaker 1: cancer and wipe it out. So how far along is
Speaker 1: humanity in during quote unquote cancer, which we know is
Speaker 1: three hundred or so separate diseases to be fair, right,
Speaker 1: And so the reason people in in UH medicine or
Speaker 1: science on talk so much about curing cancer is because
Speaker 1: it is three hundred different diseases. You don't your diabetes
Speaker 1: at the same time as you cure heart attacks at
Speaker 1: the same time as you cure Alzheimer's, because they're really
Speaker 1: different diseases. And cancer is sort of like that. But
Speaker 1: let's say if you call it roughly three hundred different
Speaker 1: types of cancer, I mean it's you know, less than
Speaker 1: ten that we've made such astounding progress on. You know,
Speaker 1: it's childhood leukemias is one example where it used to
Speaker 1: be mortality rate within six months or a year, and
Speaker 1: now it's more like eight or go on to live
Speaker 1: long lives. That's a stounding and you can see we're
Speaker 1: not there yet with many other cancers. But for example,
Speaker 1: when I started almost twenty years ago, melanoma was a
Speaker 1: death sentence. Every time you ran a melanoma trial for
Speaker 1: probably thirty years clinical trial, the placebo arm or the
Speaker 1: standard care arm and the treatment arm would be identical.
Speaker 1: He'd spent two or three or four years. Everybody would
Speaker 1: put in all this time, and it was always the
Speaker 1: same disappointing result. Now almost so many trials are positive.
Speaker 1: Something turned the corner why is that. Why are we
Speaker 1: now more successful with that form of cancer versus others. Well,
Speaker 1: melanoma turned out to be a type of cancer that's
Speaker 1: very sensitive to the immune system, and we still don't
Speaker 1: know why. There's a lot of theories, but it happens
Speaker 1: to be one of not many, but a small number
Speaker 1: of cancer types. And it may be because it's near
Speaker 1: the skin and the skin is so sensitive to the
Speaker 1: immune system. There are a lot of immune cells there.
Speaker 1: Because when something lands on your skin, you or your cut,
Speaker 1: you have a cut, the immune system rushes over. So
Speaker 1: it may be that melanoma is a special case. But
Speaker 1: in it what was fantastic is when maybe seven eight,
Speaker 1: nine years ago the first trials started showing dramatic effect.
Speaker 1: It's not a cure, but we are so much better
Speaker 1: in that disease. There was a lot of serendipity there.
Speaker 1: Like even the work on the immune system, that's a
Speaker 1: hundred year old idea. People notice that a long time
Speaker 1: ago that sometimes when the immune system is activated, cancers
Speaker 1: go away. You you sneeze on people if you just
Speaker 1: if your treatment is, hey, let's just sneeze on this
Speaker 1: cancer patient. Right, Five out of a hundred or ten
Speaker 1: out of a hundred might have complete remissions of their
Speaker 1: two People knew that. People knew that, they knew that. Actually,
Speaker 1: fifty sixty years ago from the clinics for tuberculosis, we
Speaker 1: don't have those that anymore. These clinics people who had
Speaker 1: tuberculosis used to get sent to, but people who had melanoma,
Speaker 1: and we go to these tuberculous as clinics, a surprisingly
Speaker 1: high percentage of them their cancers would disappear. And that's
Speaker 1: because they were like fighting this infection and the immune
Speaker 1: system was activated. So we still don't understand the signs
Speaker 1: of that. But you said, how far are we We're
Speaker 1: at the beginning of the exponential curve. What's happened is
Speaker 1: about fifteen or twenty years ago we got the tools,
Speaker 1: we sequenced the genome and the biotech knowledgy kind of
Speaker 1: revolution of years ago that allowed us to grow proteins
Speaker 1: in the lab and make those a commercial scale, create
Speaker 1: a new set of tools, and we're just starting. It's
Speaker 1: really just the beginning of using those amazing tools to
Speaker 1: do things like one of those things is getting the
Speaker 1: immune system to fight fight tums. And like I said,
Speaker 1: there was about a hundred years of trying to do that,
Speaker 1: and none of the standard approaches work, and then no
Speaker 1: one exactly knows why someone tried a slightly different angle.
Speaker 1: Let's target this protein, not that immune protein. Boom. It worked,
Speaker 1: and and it wasn't even the original protein that the
Speaker 1: scientists had been thinking about would be the key to
Speaker 1: it all for many many years. Even the scientist who
Speaker 1: win the Nobel Prize, they thought it would be this
Speaker 1: other thing that would be the key. It turns out
Speaker 1: it was this thing, and nobody knew. So there's so much.
Speaker 1: It's really the combination of strong science and an appreciation
Speaker 1: of serendipity. When you can put those two things together,
Speaker 1: the magic can happen. So taking where we are in
Speaker 1: that J curve, starting that that ramp up of the
Speaker 1: hockey stick. UH, is it a fair question to ask,
Speaker 1: will we see cancer the Emperor of maladies? To borrow
Speaker 1: the book title, UH, cured in our lifetime? I think
Speaker 1: we will see certain cancers we've seen three or four
Speaker 1: or five go, you know, well beyond of people who
Speaker 1: are diagnosed with it have more than five or sometimes
Speaker 1: more than ten years survival. So by any reasonable definition,
Speaker 1: you could call that a cure. And slowly, we're getting
Speaker 1: better and better. The survival times in melanoma I have
Speaker 1: gotten longer and longer multiple mileoma. You know, twenty years
Speaker 1: ago that was a death sentence. There was nothing. And then,
Speaker 1: in an almost serendipitous event, there was a woman here
Speaker 1: in New York who was thirty one who called a
Speaker 1: doctor that I actually I used to work with in
Speaker 1: Boston named Judah Folkman, who had this kind of wild,
Speaker 1: crazy idea, Hey, let's fight tumors by blocking blood vessels
Speaker 1: to the tumors. And everybody thought that was the dumbest
Speaker 1: idea they've ever heard, really anti angiogenesis exactly. At the time,
Speaker 1: everybody knew that the only way to fight tumors was
Speaker 1: to bomb them, would keep poison them with chemotherapy like
Speaker 1: a giant bomb, or burn them with radiation. The idea
Speaker 1: that there were these subtle signals that tumors were like
Speaker 1: homes and they were laying down pipes, and if you
Speaker 1: could block those pipes, you could slow the growth of
Speaker 1: those homes. That was considered radical. Judah was asked to
Speaker 1: There was a spe shall committee at his hospital that
Speaker 1: was asked to evaluate his work because it was so
Speaker 1: controversial and it said, well, we don't think there's any
Speaker 1: value here. You need to resign, really stop what you're doing.
Speaker 1: That's astonishing NY. And how did that progress from there? Well,
Speaker 1: he was I remember he was talking to some post
Speaker 1: docs and student who said who was like, oh, I'm
Speaker 1: really depressed. You know, my paper was rejected. And he
Speaker 1: said to her said, well, if you want to understand rejection,
Speaker 1: come to my office. I will show you pink slips
Speaker 1: with the word clown on them. Right, thirty two years
Speaker 1: after he first suggested his idea, on a stage in Chicago,
Speaker 1: a guy got up, a scientist got up, packed auditorium two,
Speaker 1: present the data from the largest study ever run to
Speaker 1: that date, and patients with advanced calling cancer pressed a button,
Speaker 1: flipped the slide. Patients who had received the drug based
Speaker 1: on Judah's ideas lived longer on average, and anyone had
Speaker 1: ever lived with advance It's calling cancer. It was like
Speaker 1: a standing ovation. This was thirty two years after Judah
Speaker 1: first suggested his ideas. It was a standing ovation. I
Speaker 1: remember a speaker said something like, if only Dr Folkman
Speaker 1: were alive to see this, And Judah was actually sitting
Speaker 1: in the back, you know, and turned to his neighbor
Speaker 1: and smiled, and and he didn't raise his hand and
Speaker 1: say still here, I'm still here. No, but it was
Speaker 1: just and you love telling that story, but it's uh
Speaker 1: an example of all these these ideas that are dismissed
Speaker 1: as crazy and so many things that we take for
Speaker 1: granted today, even Facebook. If you remember when Zuckerberg was
Speaker 1: going around to raise money for it in two thousand
Speaker 1: and four, every social network had failed. My Space was
Speaker 1: just failing. Friends to well, my Space was friends to
Speaker 1: was just failing. And every every investment, almost all the
Speaker 1: intelligent investors, said well, there's no money. Social networks can't
Speaker 1: make any money because they're just fats. Everybody goes to
Speaker 1: the next one. Well cool, well they were Well one
Speaker 1: investor took a look at that and he said, well
Speaker 1: is that really true? And you know that was Peter
Speaker 1: till and a five thousand dollar check and sold it
Speaker 1: eight years later for a billion dollars. Not not a
Speaker 1: bad return. But it was the same thing with so
Speaker 1: many of these things. Search everybody said, oh, you're crazy,
Speaker 1: you can't make it. Was Google and everybody said, you
Speaker 1: can't make any money. It's just like a Yellow Pages.
Speaker 1: There's no money in yellow pages. Come on, give us
Speaker 1: a break. One of my favorite books is William Goldman's
Speaker 1: Adventures UH in Screenwriting, and he talks about nobody knows
Speaker 1: anything in Hollywood and the list of of movies that
Speaker 1: were passed over by every studio from E T two
Speaker 1: Star Wars, two Raiders of the Law, like one amazing
Speaker 1: movie after another nobody wanted anything to do with. One
Speaker 1: of my favorite is the James Bond story. Ian Fleming
Speaker 1: when he wrote this, you know, I wrote this book
Speaker 1: that became reasonably popular but not a huge success. He
Speaker 1: really wanted that kind of life that, you know, the
Speaker 1: James Bond, and every studio nine years just said, are
Speaker 1: you kidding a metrosexual British spy who saves the world.
Speaker 1: No American audience is going to go for that. And
Speaker 1: he finally kind of gave up, gave it to these
Speaker 1: two sort of not very reputable producers, and they the
Speaker 1: studio that finally took it, had so little confidence. They said,
Speaker 1: who is this actor in here? Used to drive a
Speaker 1: milk truck. He's been in like two movies. His name
Speaker 1: is Sean what Connery? What? No way, No one's gonna
Speaker 1: They opened it in to drive in studios in Texas
Speaker 1: and Oklahoma, and of course it became the most successful,
Speaker 1: longest running film franchise in history. So most of these
Speaker 1: things that we take for granted today began life as
Speaker 1: a loon shot. And one of the things, one of
Speaker 1: the lessons that you learn when you work on these
Speaker 1: things is you need to expect the three deaths, the
Speaker 1: deaths that they will die several times. Quite fascinating. Let's
Speaker 1: talk a little bit about life at a pharmaceutical company
Speaker 1: or a biotech company you mentioned, and how often things
Speaker 1: are overlooked, How how many times drugs and ideas and
Speaker 1: concepts have to fail. How frustrating is it for researchers
Speaker 1: to constantly be dealing with failure. It's worse than being
Speaker 1: a hitter in baseball if you hit three hundred and pharmaceuticals,
Speaker 1: that's crazy. It's like a nincent failure rate, isn't it.
Speaker 1: That's right, It's very you know, it's a combination of
Speaker 1: two things. On the one hand, there's this enormous motivation
Speaker 1: because everybody has someone who is touched by a severe disease,
Speaker 1: and the idea that you're working every day to make
Speaker 1: a difference, that idea if something you do contributes to people.
Speaker 1: Anybody who's lost a family member or a loved one,
Speaker 1: how much do they wish they had more time with them? Right?
Speaker 1: And that's pretty much everybody. And that's what we can do,
Speaker 1: and that's what we're on the cusp of doing with
Speaker 1: science and medicine. So being part of that is incredibly exciting.
Speaker 1: It's the advantage of it. It's unlike almost any other
Speaker 1: industry or field because you feel like you could do
Speaker 1: something that just affects millions if you do it well.
Speaker 1: The flip side of that is, as you say, the
Speaker 1: failure rate is astounding. You know, cent of drugs that
Speaker 1: start clinical trials won't make it to the end, and
Speaker 1: so you just have to accept that there's the benefits
Speaker 1: and there's the cost, is that there's a very high
Speaker 1: failure rate. Was it a ciro endo who said it's
Speaker 1: not a good drug unless it's been killed three times?
Speaker 1: Is that right? And I was actually, Uh. We had
Speaker 1: an advisor, a guy named Jim Black, Sir James Black,
Speaker 1: who won the Nobel Prize for developing two of the
Speaker 1: most important drugs drug categories in the twentieth century, of
Speaker 1: beta blockers, and histamine antagonists. Anyways, he was in his
Speaker 1: eighties when I got introduced, and he loved what we
Speaker 1: were doing at this little biotech company. Reminded him, I
Speaker 1: guess of how he went his approach and philosophy to
Speaker 1: discovering new drugs. And he would fly over from Scotland
Speaker 1: every now and then and meet with our team and
Speaker 1: advise us. And I remember one night he came, it
Speaker 1: was like eight am, it was like seven pm. We
Speaker 1: sent everybody home for dinner, and we went to dinner,
Speaker 1: and then it was like nine or ten pm. Everybody
Speaker 1: went and I was like exhausted, and he was like, Safi,
Speaker 1: Saffie stayed with me, and have another drink, have some whiskey.
Speaker 1: And I was like, how does this eighty two year
Speaker 1: old guy five three thou miles talk all day long?
Speaker 1: So I we started chatting and I tell him on
Speaker 1: I'm feeling kind of down because this very promising project
Speaker 1: we had in the lab I was really excited about
Speaker 1: and it just like didn't work negative data. And he
Speaker 1: leans over to me Pat's money and says, Safie, it's
Speaker 1: not a good drug unless it's been killed three times.
Speaker 1: And that stayed with me and I mentioned so to
Speaker 1: earlier expect the three deaths. And that's what you see
Speaker 1: so often with really promising ideas, that you need to
Speaker 1: expect the fact that you're going to get punches in
Speaker 1: the stomach many times. Maybe it's three times, maybe it's
Speaker 1: four times, maybe it's ten times. If it's a really
Speaker 1: important idea, it will have those big punches in the stomach.
Speaker 1: So let's talk about something that was punched repeatedly, a
Speaker 1: less glamle. That's right, So tell us about that drug.
Speaker 1: How was that molecule uncovered and how did it actually
Speaker 1: work to arrest certain cancers? Well, I wish it had
Speaker 1: a better ending. So it had some very promising early
Speaker 1: data like a lot of drugs, and then in later
Speaker 1: stage trials it didn't work like a lot of drugs,
Speaker 1: and so it sounds like a great story. What was
Speaker 1: exciting about it is that it did uncover a totally
Speaker 1: new mechanism, which was what So it targets the way
Speaker 1: cancer cells breathe, So it targets and fire. When you
Speaker 1: say breathe, you mean consume oxygensume oxygen, so the mitochondria
Speaker 1: and so it specifically went into the mitochondria and specifically
Speaker 1: targeted a part of the mitochondria in a very unusual way,
Speaker 1: right exactly, And it did so in a way that
Speaker 1: nobody had ever thought about doing before. And we found
Speaker 1: it because it was a screen. Meaning you take this
Speaker 1: library of chemicals and you don't the really unusual structures,
Speaker 1: and we happened to, through all sorts of long back stories,
Speaker 1: have a collection of chemical structures that nobody else had.
Speaker 1: Your partner was funded by Michael Milken, anyone out and
Speaker 1: bought thousands of drugs from all around the world, including
Speaker 1: Soviet Russia exactly. And so in fact, that's a fascinating story.
Speaker 1: Milkin gets colon cancer, writes a four million dollar check
Speaker 1: to your partner, who says, I know there are all
Speaker 1: these chemicals and labs that nobody's doing with, send me
Speaker 1: some vials from the Soviet Union. That's exactly what happened.
Speaker 1: This was actually a Russian military lab, were just collecting
Speaker 1: soil samples and they at the time, well thirty years ago,
Speaker 1: people didn't really think about, oh, what's the value of
Speaker 1: having these unknown, uncategorized chemical structures. Today we understand that
Speaker 1: just the pure science logical, deductive reductionist reasoning of here's
Speaker 1: the protein, and here's what it looks like, and let's
Speaker 1: target it on the computer. Or something just misses a ton,
Speaker 1: and sometimes having a random soil sample that somebody picked
Speaker 1: up can contain something that you never expected. I think
Speaker 1: your partner described that chemical as something some engineer, some
Speaker 1: chemists made in a lab for fun and then put
Speaker 1: away and never thought of. Again, that's right, and so
Speaker 1: many of these discoveries kind of begin like that. And
Speaker 1: so then this is where you allow room for serendipity.
Speaker 1: You say, let's just take what we have and see
Speaker 1: what happens. And then we saw this signal from this molecule,
Speaker 1: which was really surprising. Nobody expected to see this strong
Speaker 1: signal in the lab and a cell cultured dish that
Speaker 1: this molecule acted in this unusual way, and we said, well,
Speaker 1: why is it doing that. We actually couldn't figure it out.
Speaker 1: It took almost twenty years to understand how it was working.
Speaker 1: And while that might sound sort of surprising today, because
Speaker 1: today there's this idea that you should be able to
Speaker 1: understand everything right away, and that's actually the reverse. That
Speaker 1: actually is a very bad idea that can really hurt
Speaker 1: innovation and create the solution for us figure out why
Speaker 1: it works later. Almost so many of the drugs we
Speaker 1: used to, like even the anty, almost everything people use
Speaker 1: in the brain, whether it's antidepressants or anesthetics, they were
Speaker 1: discovered by accident and it took sometimes a hundred years.
Speaker 1: With an aspirint, nobody knew how that worked, probably for
Speaker 1: close to a hundred years. So, you know, anesthesi was
Speaker 1: discovered because there was some you know, young guy in
Speaker 1: the lab who had a chemical and he kind of
Speaker 1: put it on his finger and he put it on
Speaker 1: his tongue, which you don't do any more, and then
Speaker 1: his tongue went nomin He was like, that's weird, and
Speaker 1: then he kind of explored that, and that became like
Speaker 1: one of the major classes of anesthetics. Wait, we don't
Speaker 1: just you know, stick, we don't we don't just lick
Speaker 1: new chemicals to see what the results. Generally, generally you
Speaker 1: don't lick the cultured edition the lab probably probably a
Speaker 1: smart smart approach um that that that's quite fascinating. And
Speaker 1: to wrap up a less glamal, somehow the copper gets
Speaker 1: into the nucleus of the cancer cell and essentially burns it.
Speaker 1: It blocks the mitochondria from firing, so it basically messes
Speaker 1: up the battery of which is sort of the breathing
Speaker 1: engine or the battery the mitochondria of a cancer cell.
Speaker 1: It took twenty years to understand how that really works.
Speaker 1: So one would think that might be effective at fighting cancer. Yeah,
Speaker 1: and so we ran a couple of clinical trials and
Speaker 1: some worked and unfortunately the large one that we did
Speaker 1: in metastatic melanoma didn't work, so we had to halt
Speaker 1: development on that drug. Now I understand that this is
Speaker 1: now ten or fifteen years later, there are still people studying,
Speaker 1: in fact their papers coming out on it. So maybe
Speaker 1: someone will pick it up in the future and use
Speaker 1: either the understanding of the science this is a new
Speaker 1: way to target cancer drugs or that kind of molecular
Speaker 1: related molecules in the future. But what we did was
Speaker 1: a first step. We had uncovered a new way to
Speaker 1: kind of block the battery of the Kansas cell, which
Speaker 1: really hadn't been talked about much before. And to wrap
Speaker 1: up with Senta, you you left Center after thirteen years
Speaker 1: the company had gone I p O. What is the
Speaker 1: state of Center today? Sent emerged with another company. It's
Speaker 1: publicly traded. There's a different management team and board, and
Speaker 1: so it's going strong move. It moved to Nash, a
Speaker 1: different disease, a different therapeutic careers. Quite fascinating. I found
Speaker 1: the book to be very fascinating. It was a really
Speaker 1: interesting read. But one of the themes that keeps recurring
Speaker 1: is the ongoing battle in institutions between the franchise ers
Speaker 1: and the innovators. Explain that, sure, you can think of
Speaker 1: whenever you organize people into a group with a mission
Speaker 1: and a reward system tied to that mission, you have
Speaker 1: just created two different kind of what you can think
Speaker 1: of as phases of human organization, and it's the same
Speaker 1: thing as whenever you Then this will sound crazy, but
Speaker 1: like this glass of water that's sitting in front of me,
Speaker 1: whenever you put molecules together, they can exist in two phases.
Speaker 1: One is liquid where they're all slashing around, and one
Speaker 1: is solid where they're totally rigid. But it's exactly the
Speaker 1: same molecules. The behaviors are totally different, and the same
Speaker 1: thing is true with teams and companies. You can have
Speaker 1: the same people organized into a group, whether mission and
Speaker 1: reward system tied to that mission, and you will find
Speaker 1: there two different phases. There's one let's say a small
Speaker 1: company ten people. In that phase, everybody's steak and outcome
Speaker 1: is huge, and they will unite around the crazy ideas,
Speaker 1: and when they stumble, they'll go and rescue them. The
Speaker 1: perks of rank, which is sort of the other force
Speaker 1: that that's pulling out them, is tiny compared to that
Speaker 1: incredible steak and outcome. If their drug or their movie
Speaker 1: project works at a ten percent company, they're gonna be
Speaker 1: heroes and millionaires forever. But doesn't they're unemployed. Now, imagine
Speaker 1: the same people inside a much larger company ten thousand,
Speaker 1: fifty people. Well, their steak in the outcome of what
Speaker 1: they're working is much less, but the perks of rank
Speaker 1: are much more. So these two forces have shifted. Just
Speaker 1: like in a glass of water, there're two forces, one
Speaker 1: that wants to make molecules run around and one that
Speaker 1: wants to lock them rigidly in place. And in the
Speaker 1: case of a glass of water, as you rotate temperature,
Speaker 1: you change between these two things. And in companies, as
Speaker 1: you increase team size, increase group size, increased company size,
Speaker 1: you change between these behaviors of nurturing crazy ideas and
Speaker 1: rejecting them and the focus on execution and what works
Speaker 1: well in committees, And so many entrepreneurs who have these,
Speaker 1: you know, five person companies that go to fifties thousand,
Speaker 1: and they come to me like, that's exactly what happened.
Speaker 1: Conversation in the hallway five years ago, when we were
Speaker 1: much smaller, was all about the project. Today conversations in
Speaker 1: the hallway are about politics. And there's this sudden shift.
Speaker 1: The glass of water has gone from liquid to solid.
Speaker 1: And while that sounds like an analogy, what makes it
Speaker 1: genuinely interesting is that you can write that down from
Speaker 1: first principles. You could look at people's incentives. You can
Speaker 1: write down an equation for their incentives, and you can
Speaker 1: see when that shift will happen. And once you understand that,
Speaker 1: just like with a glass of water, you can begin
Speaker 1: to manage it. So let's talk about how to manage that.
Speaker 1: And the solution you have written about is to take
Speaker 1: the wild ideas, the loon shots, and put them in
Speaker 1: a separate organization apart from the franchises. So my favorite
Speaker 1: example in the book is radar technology that I think
Speaker 1: the Navy had sometime in the after World War one
Speaker 1: and it just sat there for a decade or longer.
Speaker 1: Tell us about that. Yeah, that's funny. And you know,
Speaker 1: just incidentally, as an anti I was telling you, I
Speaker 1: was on a nuclear submarine talking to this senior admiral
Speaker 1: in the Navy about how do we help the Navy
Speaker 1: innovate faster and better? And he had my book and
Speaker 1: we were sitting down, and I was a little nervous
Speaker 1: what was he going to say? Because I talked about
Speaker 1: how radar, which is a technology that ended up turning
Speaker 1: the course of the Second World War and helping the
Speaker 1: Allies catch up to Nazi Germany eventually defeat Nazi Germany,
Speaker 1: was buried in the Navy for eighteen years and we
Speaker 1: lost lives as a result of that. I lost it
Speaker 1: wasn't ready in time for Pearl Harbor. And I was
Speaker 1: pretty nervous that, oh man, because I spend you know,
Speaker 1: a little bit of this chapter talking about how the
Speaker 1: Navy buried this really important technology. And I said, I
Speaker 1: asked him kind of gingerly, well how did you feel
Speaker 1: about that story? And he said, that was my favorite
Speaker 1: story in the book. So you've got to give military people,
Speaker 1: at least senior ranks credit. They are all historians, and
Speaker 1: they don't look at the Navy from as their navy.
Speaker 1: It's just a previous generation and if there's something to
Speaker 1: be learned from it, they seem to be pretty good
Speaker 1: about adapting as they go forward. Maybe a little too slowly,
Speaker 1: but the better military people are tacticians and historians. With
Speaker 1: many of the senior leaders in the national intelligence agencies
Speaker 1: or the Department of Defense, the best leaders are thinking
Speaker 1: over the course of decades and sometimes century. I think
Speaker 1: you had Ash Carter on your show is not only
Speaker 1: a physicist, but a student of medieval history, and those
Speaker 1: tend to be the most interesting thinkers. And so, for example,
Speaker 1: one of the reasons that I'm spending a lot of
Speaker 1: time kind of pro bono there is that what's worked
Speaker 1: for the last hundred years is not going to work anymore.
Speaker 1: And that's pretty much always true. If you're fighting the
Speaker 1: last war, you're gonna lose that. Well, there's a famous
Speaker 1: sarying the generals tend to fight the current war with
Speaker 1: the technology that won the previous war. But what's happening now,
Speaker 1: and we started most of if you look at military history,
Speaker 1: we started most of the wars in the past hundred
Speaker 1: years behind in some way in technology or in strategy
Speaker 1: compared to our enemies, but because of some advantages that
Speaker 1: we have as a country, we were able to catch up.
Speaker 1: What's happening now is that the source of battlefield advantage
Speaker 1: is shifting from hardware to software, and our organizations are
Speaker 1: designed for hardware. They're not designed for the pace of
Speaker 1: innovation of software, which is much faster. So they're going
Speaker 1: to break and we may not be so lucky next time.
Speaker 1: The next war, the next battle fielded where the last
Speaker 1: thing any of us wants to see is we put
Speaker 1: our soldiers on a battlefield surrounded by machine learning robots
Speaker 1: and slaughtered. That's one of the reasons I'm having all
Speaker 1: these discussions, and many of the senior military leaders have
Speaker 1: realized that what we just talked about just separating is
Speaker 1: not enough. That's like innovation theater. You create a box,
Speaker 1: put the artist, the crazy people working on the crazy ideas. Here,
Speaker 1: there's a widespread perception in the military that innovation labs
Speaker 1: have maybe a three or four year lifespan and then
Speaker 1: they die. So what's missing is the second part of that,
Speaker 1: which is you need to separate these groups because the
Speaker 1: people working on the crazy ideas have a very different
Speaker 1: job than the soldiers who are working on on time,
Speaker 1: on budget, on spec. So what's the go between these
Speaker 1: two radically groups. That's what's been missing people. You know,
Speaker 1: Let's take the Navy has a seven thousand people at
Speaker 1: Johns Hopkins Applied Physics Lab, incredible scientists, and they have
Speaker 1: incredible training and career path and development for the soldiers
Speaker 1: who are running ships on time, on budget, on spec.
Speaker 1: But the person going between those two groups is like
Speaker 1: a high school kid with the clipboard. Why So in
Speaker 1: the book you talk about Van over Bush, who is
Speaker 1: the person who has both the background and m I
Speaker 1: T and is respected by the academics, but comes from
Speaker 1: a Navy family. And I believe was he a physicist
Speaker 1: also he was an engineer, engineer, and he was really
Speaker 1: not only able to bring radar forward, bring a number
Speaker 1: of really amazing technological innovations that helped win the war,
Speaker 1: the radar proximity fuse, the proximity fuse right, that really
Speaker 1: changed the course of the war. And as I was
Speaker 1: reading your description of the war, very much made me
Speaker 1: feel like, oh, we really could have very easily lost
Speaker 1: World War two. Yeah, people don't realize by the single
Speaker 1: greatest set of the war, as Churchill and Roosevelt knew,
Speaker 1: was the U boats Hitler had. When we started, Hitler
Speaker 1: had a Nazi Germany had a lot of advantages. Their
Speaker 1: U boats were something the Allies had no answer for
Speaker 1: and looked ready to strangle the Atlantic, which they did.
Speaker 1: Their planes in the looft Off, the German Air Force
Speaker 1: outclassed anything the Allies had and looked ready to bomb
Speaker 1: West in Europe into submission, which they did exactly a
Speaker 1: year later, within a matter of weeks. And you have
Speaker 1: these two German scientists who discovered something called nuclear fission,
Speaker 1: which put Hitler within reach of the greatest weapon ever,
Speaker 1: most destructive weapon ever created by man. And so we
Speaker 1: started behind, and you know, we managed to catch up
Speaker 1: in some things, but not in the U boats, and
Speaker 1: Hitler was unable to eat defeated most of Western Europe
Speaker 1: except for Britain and I. In fact, it was a
Speaker 1: radar that helped save Britain in the Battle of Britain.
Speaker 1: But Hitler decided and correctly eventually understood that he could
Speaker 1: win the war with the U boats. That those U
Speaker 1: boats were sinking down Allied ships every single month for
Speaker 1: the first four years of the war, faster than the
Speaker 1: Allies could build them. And in spring of nine Britain
Speaker 1: was down to three months of oil, three months of planes, tanks,
Speaker 1: trucks all need oil, and we were three months away
Speaker 1: from a united Nazi Western Europe. The world map would
Speaker 1: have been completely different. And that's when the first by
Speaker 1: Liberator bombers, with a couple of technologies from Van over
Speaker 1: Bush and his group of loons sailed out over the Atlantic,
Speaker 1: concluding and most importantly Mike Grave radar that allowed the
Speaker 1: pilots to see just a periscope, they could exactly and
Speaker 1: began within a matter of weeks shooting down U boats
Speaker 1: like shooting fish in a barrel. And Hitler lost one
Speaker 1: third of his entire U boat fleet in that four
Speaker 1: week period, more than in any other year of the war.
Speaker 1: One month, he lost more than any previous year. That's
Speaker 1: exactly right. And within six weeks later and they were
Speaker 1: this close to winning Western Europe. Six weeks later, in
Speaker 1: the end of May, Admiral Dunnetts, who is the head
Speaker 1: of the German Navy, sends a radio blast across the Atlantic.
Speaker 1: All remaining U boats withdraw the Battle of the Atlantic
Speaker 1: has been lost, and then the lanes were cleared to
Speaker 1: resupply Britain, and the lanes were cleared for an Allied
Speaker 1: invasion of Europe. And a lot of people aren't quite
Speaker 1: aware of that history. It's left out of many popular histories.
Speaker 1: But that was the decisive turning point, firstly in the
Speaker 1: Battle of the Atlantic, but that Battle of the Intic
Speaker 1: was a decisive turning point in the entire war. Quite
Speaker 1: fastening and can you stick around a little bit, I
Speaker 1: have lot more questions for you. We have been speaking
Speaker 1: with Sofie Bicol. He is the author of loon Shots,
Speaker 1: How to Nurture the crazy ideas that wind wars, cure
Speaker 1: diseases and transform industries. If you enjoy this conversation, be
Speaker 1: sure and check out the podcast extras, where we keep
Speaker 1: the tape rolling and continue discussing all things innovation related.
Speaker 1: You can find that at Apple iTunes, Google podcast, Stitcher, Spotify,
Speaker 1: wherever your finer podcasts are sold. We love your comments,
Speaker 1: feedback and suggestions right to us at m ib podcast
Speaker 1: at Bloomberg dot net. Be sure and give us a
Speaker 1: review on Apple iTunes. Check out my weekly column on
Speaker 1: Bloomberg dot com. You can follow me on Twitter at Rippolts.
Speaker 1: I'm Barry Dults. You're listening to Masters and Business on
Speaker 1: Bloomberg Radio. Welcome to the podcast, Sophie. Thank you so
Speaker 1: much for doing this. I mentioned earlier, I start a
Speaker 1: lot of books, I don't finish a lot of books.
Speaker 1: I plowed straight through this. I found loon Shots to
Speaker 1: be really interesting and intriguing and filled with lots of
Speaker 1: of fascinating ideas. You have to be really proud of
Speaker 1: what you accomplished for this. This was your first book,
Speaker 1: is that right? It was? It's funny. It was about
Speaker 1: a year ago. I submitted like the final edits, and
Speaker 1: I can tell you I knew one thing for sure,
Speaker 1: my mother would read it, right. I had no idea
Speaker 1: it was you know, it's a way. It's got physics
Speaker 1: and business and history, but it's very accessible. I didn't
Speaker 1: find it remotely like, oh, this was written for phdl
Speaker 1: D level. This is this is a straightforward business book.
Speaker 1: Yeah now, and uh, you know, and I tell stories.
Speaker 1: For me, it was a lot of fun learning how
Speaker 1: to tell stories and how to structure those stories, whether
Speaker 1: it's Panama or James Bond or Pixar or toy story
Speaker 1: and why the world speaks English and how they're all
Speaker 1: connected by one idea. And so I was having fun
Speaker 1: and my wife would talk about, Sofie, what are you doing.
Speaker 1: I'm just laughing, like I'm telling thinking something funny and
Speaker 1: writing it down. But a lot of times you think
Speaker 1: stuff is funny and then you discover well, other people
Speaker 1: don't quite think so. So I had no idea. But
Speaker 1: then I remember when, um it was not long ago. Uh,
Speaker 1: someone was interviewing Bill Gates for the Wall Street Journal
Speaker 1: and they asked him, like what his three favorite recent
Speaker 1: books were or something, and he mentioned, you know, there
Speaker 1: was a social justice book because he does Gillapoor the
Speaker 1: history of pistory. And then he mentioned loon Shots. And
Speaker 1: then like I get this. I found out about it
Speaker 1: because like my publisher editor, like fifteen people start calling me,
Speaker 1: and I was like, oh, that's nice. I didn't know
Speaker 1: that that was, but apparently that's a really big deal.
Speaker 1: He does a booklist every year, and and it is
Speaker 1: a big deal. If you're a geek or a business
Speaker 1: person or a software person. You you see bills list
Speaker 1: every year. Yeah, that was cool. And then when, um, again,
Speaker 1: I know if anybody would like it. And then when
Speaker 1: Donnie Kinneman, who wrote Thinking Fast and Slow and you
Speaker 1: know as a really interesting, intelligent, thoughtful reader and writer. Um,
Speaker 1: and when he very early on supported came out very
Speaker 1: nicely in support of it, I was like, God, I got,
Speaker 1: I got my mother and Danny k like, dude, that's
Speaker 1: two people, all right, we have a win. And he
Speaker 1: is the most charming person he is ever want to meet,
Speaker 1: so thoughtful and it just likes to think about problems
Speaker 1: in a deep and big way. Remind me later, I
Speaker 1: have a hilarious Donny Danny Kneman story to tell. I'll
Speaker 1: tell you afterwards. So, um, there's a few things I
Speaker 1: didn't get to that I have to ask because they're
Speaker 1: really quite fascinating. But I want to stay with the book,
Speaker 1: um for for a bit and go over some stuff.
Speaker 1: The Moses trap. What is the Moses trap? The Moses
Speaker 1: trap is this idea, is this myth of great leadership
Speaker 1: that if you ever read, you know, these business journals
Speaker 1: with these you know color cove or covers where there's
Speaker 1: some great leader who's the Moses, who stands on top
Speaker 1: of a mountain, and they say the reason this leader
Speaker 1: is so great is they raised their staff and they
Speaker 1: anointed the chosen project, the whole, the iPod, the Holy
Speaker 1: loon shot, whatever it is. And that's a complete myth.
Speaker 1: What happens in those kind of companies when leaders lead
Speaker 1: like that is you get into the cycle if you
Speaker 1: think you're great at choosing product, and so you just
Speaker 1: keep going bigger, faster better, bigger faster better, and you
Speaker 1: keep raising your staff and picking that project, and eventually
Speaker 1: that cycle, that wheel turns one too many times and
Speaker 1: it's a disaster. That happened to Steve Jobs in his
Speaker 1: first few companies. It happened to edwin Land and Polaroid.
Speaker 1: It happened to one trip at PanAm. I mean Kodak
Speaker 1: very famously invented the digital camera and then decided, oh no,
Speaker 1: this will cut film sales. Yeah. So there's uh by
Speaker 1: the Moses trap, I mean that there's a takeaway there
Speaker 1: for business leaders, which is, or even anyone who's managing
Speaker 1: a team or an organization, which is, you want to
Speaker 1: lead much more like a gardener rather than a Moses.
Speaker 1: In other words, you want to have these two groups,
Speaker 1: the artists working on the crazy stuff. Their job is
Speaker 1: to take as much risk. You're asking them to take risks.
Speaker 1: And then the soldiers. Let's say you have some some
Speaker 1: guy whose job it is to man, you know, make planes.
Speaker 1: You don't want to tell You don't want him to
Speaker 1: be saying, well, I have an idea. Let's put ten
Speaker 1: planes in the sky, see which nine fall down. Okay,
Speaker 1: it's completely opposite jobs. And the failure point in most
Speaker 1: innovation is never in the supply of new ideas, or
Speaker 1: you put ten people in a room with a stack
Speaker 1: of posts. For now we're gonnat a thousand ideas. The
Speaker 1: failure point in most innovation in large companies with a
Speaker 1: public sector a private sector is in that transfer. The
Speaker 1: truly great leaders, whether it was Fan of a Bush
Speaker 1: or even Steve Jobs his second time around it Apple
Speaker 1: had understood this is they manage like a gardener. They
Speaker 1: take those baby stage ideas out and they bring it
Speaker 1: into the field where they will always be resistance. And
Speaker 1: that's normal, and you want that. You want that conflict.
Speaker 1: The group that's making the money rarely likes the group
Speaker 1: that's spending the money, and vice versa. And you want
Speaker 1: that tens and you want one group taking as much
Speaker 1: risk as possible. You want them trying ten things night
Speaker 1: of which will fail because if they don't, then your
Speaker 1: competitor is and your competitor will discover that ten thing
Speaker 1: and you will see it too late when it's a
Speaker 1: bullet coming to your head. You mentioned Steve Jobs had
Speaker 1: Johnny I've as the dreamer and Tim Cook as the
Speaker 1: soldier and turned out to be a really powerful combination.
Speaker 1: Right now, this myth that he was the Moses on
Speaker 1: the mountain raising his staff and anointing the chosen project
Speaker 1: is really a myth. He did of one of the
Speaker 1: first things he did when he got into Apple. The
Speaker 1: second time was promoted Johnny ive is one of the
Speaker 1: great product designers. Then the second thing he one of
Speaker 1: the next things he did is he recruited a guy
Speaker 1: named Tim Cook, with his previous job was known as
Speaker 1: the Attila, the hunt of inventory. So if there's a
Speaker 1: better name for a soldier inside a company, I don't
Speaker 1: know it. And he led by bringing them together, man
Speaker 1: eaging the transfer between those two. The iPad when it
Speaker 1: was introduced was a beautiful design and original product, but
Speaker 1: if it had cost six thousand dollars, there'd be no
Speaker 1: Apple today. It was Tim Cook that got it from
Speaker 1: six thousand to six hundred. So what people miss is
Speaker 1: they focused on, oh, you know, he picked this product.
Speaker 1: Let's they focus. They get to they manage the technology
Speaker 1: rather than than transfer. What you want to do is
Speaker 1: manage the transfer, not the technology. So something like Lucent
Speaker 1: or a te Bell Labs as it was known as previously,
Speaker 1: that was around for I don't know, almost a century.
Speaker 1: How often can these labs of innovation execute on that
Speaker 1: transference of ideas? And you look at Lucin. A ton
Speaker 1: of great stuff came out of Bell Labs that got
Speaker 1: used um and a lot of it was post any
Speaker 1: trust breakup, so it was offered out as patents more
Speaker 1: or less for free. In some ways, we owe Van
Speaker 1: ever Bush, who created this system inside the federal government
Speaker 1: that allowed the US military to catch up rapidly to
Speaker 1: Nazi Germany eventually exceed in the technologies that ended up
Speaker 1: being decisive in the Second World War, actually got his
Speaker 1: ideas from Bell Labs. So the guy who was president
Speaker 1: of Bell Labs at the time, Frank Jewett, was a
Speaker 1: mentor of his who actually helped bring vanever Bush into Washington.
Speaker 1: So in some ways vanever Bushes, you know, we owe
Speaker 1: a lot to bell Ab more than we think because
Speaker 1: it inspired Van ever Bush and vanever Bush's system. The
Speaker 1: organization that he created called the O s r D.
Speaker 1: Office of Science Research and Development, ended up becoming the
Speaker 1: National Science Foundation, the National Institutes of Health, and was
Speaker 1: the backbone, the inspiration for all of the national research
Speaker 1: infrastructure of the US. And when we look at the
Speaker 1: post War two era, the Technology Development Group that was
Speaker 1: put together really was a giant impetus for the next
Speaker 1: fifty years of economic growth as well. Well. It was
Speaker 1: a rate source of competitive advantage and it's a source
Speaker 1: of concern today. And here's what I mean by that.
Speaker 1: It is that national research infrastructure, which we understood and
Speaker 1: many other countries didn't. That investment that gave us the
Speaker 1: biotechnology industry, GPS, Internet, even the transistor was supported by
Speaker 1: that integrated circuit. So much of our progress as an
Speaker 1: economy and as a nation comes from that investment. That
Speaker 1: essentially a market failure. No one, no one company could
Speaker 1: have invested to create the biotech industry decades long. You
Speaker 1: can't you can't have that. It was It's like a
Speaker 1: game theory market theory problem, which is it's not good
Speaker 1: for anyone participant but it's good for everyone as a whole.
Speaker 1: And that's where the national research labs came in, and
Speaker 1: that's what drove so much success for the United States.
Speaker 1: Roughly half of the many trillions of dollars of GDP
Speaker 1: growth is attributed to those kinds of technologies since World
Speaker 1: War Two. The concern is that while we've figured that
Speaker 1: out seventy years ago and milk that for the last
Speaker 1: fifty years, China and Russia have understood that now and
Speaker 1: that's what they're doing now. Have we fallen behind in
Speaker 1: making those sorts of long term investments in basic science?
Speaker 1: Are we lagging China were lagging other cos we're starting
Speaker 1: to We're declining and they're increasing and that's not a
Speaker 1: good look. That's not a good trend. Where it's especially
Speaker 1: dangerous is in the shift from hardware to software as
Speaker 1: the source of advantage of national security. China and Russia
Speaker 1: today are weaponizing AI and machine learning. They have an
Speaker 1: unfortunate advantage, which is they have no ethical constraints and
Speaker 1: how they use those weapons, and they're using them on
Speaker 1: the battlefield in pretty horrific ways. For example, in Ukraine,
Speaker 1: you had a Russian cybergroup send text messages to families
Speaker 1: saying your son has been killed on the battlefield, which
Speaker 1: immediately lead to a lot of text messages are you okay?
Speaker 1: They looked at that on the grid and then began
Speaker 1: bombing those targets, and that actually in a two minute attack,
Speaker 1: turned back so much progress in the UK, so China,
Speaker 1: and China is using that to all these kinds of
Speaker 1: technologies to suppress dissident minorities. So my I'm optimistic about
Speaker 1: what we can do about many technologies, but I'm very
Speaker 1: concerned about how totalitarian regimes can use those technologies to
Speaker 1: advance their interests. So there is now in uh Washington,
Speaker 1: I met with them a few times a national by
Speaker 1: part as a National Security Commission on AI, which will
Speaker 1: hopefully chart a path that we can compete. Quite quite interesting.
Speaker 1: And in the book, one of the last chapters is
Speaker 1: why the World Speaks English? And I love the description
Speaker 1: you have in it tell the story as to why
Speaker 1: so much of the world is English speaking. Didn't have
Speaker 1: to go that way, did it? A thousand years of
Speaker 1: history and thirty seconds ago, let's go, let's do it. Well,
Speaker 1: it's it's actually taking this idea of why is it
Speaker 1: that small companies seem to be better at embracing new
Speaker 1: ideas and large companies reject them, and that as you
Speaker 1: read in the book, it's about this idea of a
Speaker 1: phase transition and then what you can do about it
Speaker 1: once you understand it. But let's take that idea of
Speaker 1: metal level. So if you look for about a millennium,
Speaker 1: not one generation or two generations, but about a thousand years,
Speaker 1: China and India dominated the world in the early science
Speaker 1: and technology, paper and printing was invented in China. You
Speaker 1: had the compass and the gunpowder, you had the currency systems,
Speaker 1: you had advanced mining, advanced drilling, advanced irrigation. There was
Speaker 1: no competition. I mean, China, India was fifty more than
Speaker 1: fifty percent of the world GDP. Britain for example, was
Speaker 1: less than half a percent. And we were talking between
Speaker 1: the middle of the yeah, about five to about between
Speaker 1: hundred thousand years at the time. You know, early science
Speaker 1: and astronomy in the Islamic Empire far exceed between the
Speaker 1: ninth and thirteenth century, far exceeded anything in Western Europe.
Speaker 1: The most widely used medical textbook in Western Europe for
Speaker 1: seven hundred years was by Ibn Sina an Islamic medical scholar,
Speaker 1: a scientist and medical scholar. And imagine today using a
Speaker 1: book for seven years it's already or seventy years. There's
Speaker 1: no way you would use a textbook seven hundred years
Speaker 1: Islamic science and astronomy and technology. The mathematics that Copernicus used,
Speaker 1: much of the ideas that he based what he did
Speaker 1: on came from India, from Islamic Empire, from China. So
Speaker 1: why English, these tiny little countries in Western Europe or
Speaker 1: like the backwater China and India were dominating the world
Speaker 1: and everything that matters. So why Well, what I talked
Speaker 1: about there is why China, Islam and India were like
Speaker 1: the Mark Fiser Novartis of their day. They were the
Speaker 1: dominant global empires. They were great like Laurel. Large companies
Speaker 1: tend to be at franchises, building the Great Wall, building
Speaker 1: the Great Canal system, irrigating hundreds of millions of square miles,
Speaker 1: building the taj Mahal, giant franchises, but they were not
Speaker 1: good at nurturing loon shots. They were not good. They
Speaker 1: About six centuries before Copernicus, san Teco, Brachi and Newton,
Speaker 1: there was a couple of scientists in Northern Sung dynasty
Speaker 1: in China. They came up with brilliant ideas about astronomy,
Speaker 1: and they were really headed in that direction, and they
Speaker 1: were right on the cusp. You could argue of the
Speaker 1: scientific revolution happening in China five d six hundred years
Speaker 1: before seventeenth century Western Europe. But there was an emperor
Speaker 1: and they and he quashed that idea after a few years.
Speaker 1: He said he didn't like it. He was the Moses
Speaker 1: with his staff, saying, not that idea, this whole thing
Speaker 1: about how the planets move. Let's move on to something
Speaker 1: that's boring. Whereas in Western Europe, Western Europe was like
Speaker 1: the tiny teeming market of biotechs. If China is Slam
Speaker 1: in India were the Mark Fiser Novartis. These were the
Speaker 1: hundreds of little biotechs in Boston or San Francisco, each
Speaker 1: of whom has some crazy idea and most of them fail.
Speaker 1: Nine out of ten fail. But here's a crazy idea.
Speaker 1: The Earth goes around the Sun. When anybody on the
Speaker 1: planet for two thousand years could see obviously the Sun
Speaker 1: is going around us, the planets are going around us,
Speaker 1: the stars are going around us. And Copernic has kind
Speaker 1: of switched it around, and he wasn't the first that
Speaker 1: that idea had been floated around for two thousand years.
Speaker 1: He made it a little more mathematical, borrowing some science
Speaker 1: from Islamic astronomers, and that idea was actually quashed by
Speaker 1: for about seven year eighty years, everybody said, well, that's
Speaker 1: obviously a deiotic If the Earth is spinning on its
Speaker 1: axis so fast, why aren't birds flung from their nests.
Speaker 1: This is stupid. It's a crazy idea, just like Facebook
Speaker 1: was a crazy idea. Google was a crazy idea was
Speaker 1: at But what happened is because you had hundreds hundreds
Speaker 1: of these tiny little nation states. When Tycho Brahi about
Speaker 1: fifty sixty years later, said let me measure this thing.
Speaker 1: Let me see if I could. Obviously Copernicus is an idiot,
Speaker 1: because we can all tell that the sun doesn't go,
Speaker 1: but I have this other theory, and let me measure it.
Speaker 1: And he started trying to measure it, and he was
Speaker 1: working on it, and then he got fired. He got
Speaker 1: fired because he was kind of a big, obnoxious ass,
Speaker 1: and he had a little The King of Denmark had
Speaker 1: given him this little little island and he was the
Speaker 1: old king died. The young king took over and he said,
Speaker 1: you come visit me. I'm the big shot, and the
Speaker 1: young king is like, I'm writing your checks, you come
Speaker 1: visit me. They got into this like pissing battle, and
Speaker 1: he was fired. But that's just like a little company
Speaker 1: where has the CEO has a battle with his board
Speaker 1: of directors. So then he went and he took his
Speaker 1: ideas and marched around all the little kings and looking
Speaker 1: if Europe, and found one in Prague, Rudolph the second.
Speaker 1: He said, yeah, I can knock yourself out. Go go
Speaker 1: build another another, another observatory. He brought the young Kepler
Speaker 1: there and that's where they discovered that what we've been
Speaker 1: saying for two thousand years was wrong. The planets don't
Speaker 1: move in circles. They move in this very different way.
Speaker 1: And that was, in some ways the spark when you
Speaker 1: throw away what everybody know to be true for two
Speaker 1: thousand years, that heavenly bodies always move in circles. They
Speaker 1: move in these things called ellipses. And nobody saw that.
Speaker 1: And Kepler and many others began saying, well, if we've
Speaker 1: been wrong about that, maybe there's something else maybe there's
Speaker 1: this thing called laws of nature and they work, not
Speaker 1: what religious authorities tell us or divine rulers tell us,
Speaker 1: but maybe there are these fundamental things called laws of nature,
Speaker 1: and maybe we need to just look at nature, and
Speaker 1: maybe everybody could figure out. Anybody who can measure well
Speaker 1: and can do experiments can figure out truth. It was
Speaker 1: the beginning of the democratization of truth and that transformed
Speaker 1: our species and the Enlightenment and and so forth. I'm
Speaker 1: fascinated by um the idea that what Westerners think of
Speaker 1: as the Dark Age, the Dark Ages from I don't know,
Speaker 1: three hundred a d. Tod and something was really not
Speaker 1: the Dark Ages for most of the world. Rest of
Speaker 1: the world. It's just the Western perspective. Oh, this was
Speaker 1: the Dark Ages, not in India, not in China now,
Speaker 1: and not only that, we used so much of what
Speaker 1: we used in advance was just the final icing on
Speaker 1: the cake that had been built by China Islam in India.
Speaker 1: That that's quite quite intriguing. Do do you miss physics
Speaker 1: at all? You have your I think one of your
Speaker 1: parents was an astrophysicist. Both were. Oh so, so let's
Speaker 1: talk a little bit about astrophysics. Do you do you like?
Speaker 1: What is Thanksgiving dinner commerce station at your home? Like? Uh?
Speaker 1: Is that a regular um discussion of quasars and black
Speaker 1: holes and the universal galactic constant? Or what? What's the conversation? Like?
Speaker 1: It was about you know, I think what was different
Speaker 1: and what we got, me and my brother and sister
Speaker 1: got out of having parents who are in science is curiosity.
Speaker 1: Because what drives scientists is curiosity about how the world
Speaker 1: works and asking questions. And so that's what our kind
Speaker 1: of home life was like. Was about asking good questions.
Speaker 1: And it wasn't so much about what do you know?
Speaker 1: What did you learn? But it was about did you
Speaker 1: ask any good questions? And that actually turns out to
Speaker 1: be an incredibly important and valuable lesson that I took
Speaker 1: for many years. I didn't you know that all this
Speaker 1: stuff about follow your passion, I never really understand. I
Speaker 1: love banana pudding, but I don't fall not going for
Speaker 1: a career in banana. No, that's it's a passion for me.
Speaker 1: But I don't follow banana pudding. But I do follow
Speaker 1: my curiosity. So when I sort of plateaued in physics
Speaker 1: that my curiosity wasn't there the way it was when
Speaker 1: I was first started. Then I made a switch and
Speaker 1: when my curiosity plateau about how big businesses work and
Speaker 1: are structured from the consulting world, and I went and
Speaker 1: started a company. So I kept following my curiosity. You know,
Speaker 1: how do you write a book? How do you tell
Speaker 1: stories that bridge together PanAm and James Bond and why
Speaker 1: the world speaks English? With this one theme that seems
Speaker 1: really difficult? But how do other you know, how do
Speaker 1: you do that? I'm really curious, and so I just
Speaker 1: kept following my curiosity. So what you get from that
Speaker 1: is wonderful and I hope to pass on to my
Speaker 1: children some day. Is a passion for asking good questions.
Speaker 1: And I wish more people would ask good questions. Speaking
Speaker 1: of good questions, before I get to my favorite ones,
Speaker 1: I don't I don't have you all day. But there
Speaker 1: were one or two questions I missed um during the
Speaker 1: broadcast portion, and let me see what I want to
Speaker 1: get to, oh um, President Obama's Council of Science Advisors
Speaker 1: on the National Future of National Research. You served on that.
Speaker 1: What was that experience like? Well, that actually was the
Speaker 1: spark for the research. It became this book because when
Speaker 1: I was called President Obama. I think like to have
Speaker 1: a lot of academic There were a lot of very
Speaker 1: august academics. They are very impressive backgrounds, and I think
Speaker 1: at some point they realized they didn't have someone in
Speaker 1: the business world, especially in the startup innovation biomedical. And
Speaker 1: one of the people there had you know, knew me
Speaker 1: from when I was a student, and so called me
Speaker 1: up and said, I hear you do something in this
Speaker 1: bio world, whatever that is. Could you come on you
Speaker 1: have any interest. I was like, sures, I'm But when
Speaker 1: I got there, the chairman said, there was a small
Speaker 1: group of us that were selected to work on this
Speaker 1: project on the future of national research. We've had these
Speaker 1: national research labs for seventy years, which the next seven
Speaker 1: years look like. And he stood up and he said,
Speaker 1: your job is to write the next generation of the
Speaker 1: van ever Bush Report. What should the future look like?
Speaker 1: And I remember thinking I have no idea who van
Speaker 1: ever bushes or what his report was. You know, I
Speaker 1: was trying to run a public company I didn't have
Speaker 1: I wasn't doing a lot of science policy reading or
Speaker 1: in history. And I remember my first reaction was probably
Speaker 1: like a lot of people's m how do I get
Speaker 1: out of this assignment, because like, really, I'm really not
Speaker 1: the right guy for this job because I have no
Speaker 1: idea what this guy is talking about, and kind of
Speaker 1: maybe I can go back to the real world and uh.
Speaker 1: But then the more I started reading about it, I
Speaker 1: was fascinating. He took people talk about, oh, it's hard
Speaker 1: to innovate when you're large. Well, van ever, Bush was
Speaker 1: faced with a two million person organization and he created
Speaker 1: this astonishing system for innovating incredibly fast that played an
Speaker 1: incredibly important role in Second World War and the future
Speaker 1: of the United States. How did he do it? Why?
Speaker 1: Why did it work? What did he understand? And I
Speaker 1: just got more and more curious about coming back to
Speaker 1: asking questions, why did it work so well? How did
Speaker 1: he do it? What insights did he have? And I've
Speaker 1: had The more I read about him, the more I
Speaker 1: found out that there were all these lessons that he
Speaker 1: had picked up over the years that were really applicable
Speaker 1: to the business world and private sector, not just the
Speaker 1: public sector, and nobody had really gone there. And you
Speaker 1: give some credit to FDR for basically recognizing that Bush
Speaker 1: had correctly diagnosed the problem with the Pentagon. I don't
Speaker 1: even know what was closed the War Department then uh
Speaker 1: and had some solutions to bridge that gap. I don't
Speaker 1: know a lot of presidents that would have been as
Speaker 1: insightful as that pre war time president. It was a
Speaker 1: ten minute meeting and a Bush was at the time
Speaker 1: dean of engineering at m i T. Was a provost,
Speaker 1: He was a number two at m i T to
Speaker 1: help turn m I T. Was it kind of an
Speaker 1: organizational genius. He had turn m i T from a
Speaker 1: average university into the leading technology university in the country
Speaker 1: and then eventually the world. But he saw the writing
Speaker 1: on the wall. He saw from all the fleeing Jewish
Speaker 1: refugees from Nazi Germany that they were far ahead of
Speaker 1: us in critical technologies. In yeah. Well, he and several
Speaker 1: others were hearing this from the Jewish refugees, and he understood.
Speaker 1: He had worked with the military, he understood that we
Speaker 1: were far behind, and so he quit his job as
Speaker 1: a tenured professor, moved to Washington, talked his way into
Speaker 1: a ten minute meeting with FDR, and he told FDR
Speaker 1: there's a war coming and we're gonna lose because the
Speaker 1: army and the Navy will never catch up in time.
Speaker 1: And he gave him a proposal, three short bullets. I
Speaker 1: want you to authorize a new group inside the federal
Speaker 1: government that will report only to me, and I will
Speaker 1: report only to you, and I will mobilize the nation's
Speaker 1: scientists for war. It was a ten minute meeting. If
Speaker 1: DR read it, looked him up and down, signed it. Okay,
Speaker 1: FDR turned around, got to work. That's astonishing, just astonishing.
Speaker 1: People have no idea how close we really came to
Speaker 1: losing World War two, and how close we came to
Speaker 1: have completely different world map. And and if you take
Speaker 1: twenty popular histories of the Second World War, you might
Speaker 1: find van for Bush's name in one or two of them.
Speaker 1: That's amazing. So I don't have you all day. I
Speaker 1: want to get to some of my favorite questions I
Speaker 1: ask all of my guests. I find these are revealing
Speaker 1: of who they are and what we don't know about them. Um,
Speaker 1: what are you streaming, watching listening to? Tell us about
Speaker 1: podcasts or Netflix? What do you what are you enjoying
Speaker 1: these days? Well, my wife and I actually really loved Homeland,
Speaker 1: Homeland and the Americans, and I think if I have
Speaker 1: a guilty pleasure probably be that new Sherlock Holmes one
Speaker 1: with Benedict cover Batch. It's a lot of fun. I
Speaker 1: haven't gotten to that. If you like um Homeland, do
Speaker 1: you ever watched Fouda so it's an Israeli security group.
Speaker 1: Do not watch it before you go to bed because
Speaker 1: it is so gripping f A U d A so
Speaker 1: gripping and so exciting, Like when you're done, you're like,
Speaker 1: So it's very much a challenging thing to watch. And
Speaker 1: then Jack Ryan is is really worth checking out. It's
Speaker 1: so funny because I spent we were talking before I
Speaker 1: spent a while at the CIA, and I remember asking them,
Speaker 1: I said, to go, like his Tom Crui is gonna
Speaker 1: come jumping down here from somewhere. Yeah, it's really fun.
Speaker 1: But I remember asking them about do you guys watch
Speaker 1: any of these shows? And they were big fans of
Speaker 1: The people I spoke to were pretty big fans of Homeland,
Speaker 1: but the Jack Ryan They're like, yeah, it's just not well,
Speaker 1: you know, any of the Tom Clancy stuff, the Cold
Speaker 1: War things that was his forte. Everybody has kind of
Speaker 1: moved on and it's a little bit of a Cold
Speaker 1: War story in the modern era. So it it may
Speaker 1: not be their cup of tea, but everybody in it
Speaker 1: is really interesting. Tell us some tell us the most
Speaker 1: important thing people don't know about Sofia bicol. Wow, I
Speaker 1: don't even know where to I guess you know. When
Speaker 1: I was in college, I had this dream. A buddy
Speaker 1: of mine and I had this dream that we would
Speaker 1: ride motorcycles across the country. And then when um, when
Speaker 1: I got out of call, of course I was never happening.
Speaker 1: Do you ride at all? So yeah, when as soon
Speaker 1: as I graduated and moved to the Bay Area, one
Speaker 1: of the first things I did was bought a motorcycle,
Speaker 1: and I spent much of that ten years at the
Speaker 1: time that I was in San Francisco Bay Area on
Speaker 1: the bike. So I love to ride. You you can't
Speaker 1: ride around here. When I moved to New York uh
Speaker 1: years ago, I sold the bike. At that when I
Speaker 1: first started, I was an idiot, like any of course something.
Speaker 1: I remember that there was no helmet law back then,
Speaker 1: But that's important because there's a shortage of organs and
Speaker 1: the lack of helmet law. States with no helmets don't
Speaker 1: have a backup. If you want to do good for
Speaker 1: the world and don't at your organs, don't wear a helmet.
Speaker 1: It's because you basically have a nicely preserved body. That's right,
Speaker 1: it's k or it just goes straight to the hospital,
Speaker 1: skip the motorcycle and say cut cut off my head.
Speaker 1: But I actually I remember one day going out. I
Speaker 1: was living in Palo Alto and East Palo Alto at
Speaker 1: the time. People I don't know this, but it was
Speaker 1: like the murder capital of the United have like the
Speaker 1: wealthiest group and then you have like the murder capital.
Speaker 1: And I remember I had to buy a helmet. I
Speaker 1: remember going, you know, looked into classified I don't even
Speaker 1: know if there was a Craigslist back then, and I
Speaker 1: found this guy in East Palo Alto and I remember
Speaker 1: driving over there and said, oh yeah. It was like
Speaker 1: this Hell's Angel guy with a giant gud and the
Speaker 1: huge beard and the tattoos. And I was like, yeah, man,
Speaker 1: this sucks. I have to buy a helmet, isn't it
Speaker 1: really doesn't really suck? And he just looked at me
Speaker 1: and said, you're an idiot. Really, he said, you're an idiot.
Speaker 1: Do you know how many friends I've lost because they
Speaker 1: didn't wear helmets? And you could. We could survive a
Speaker 1: fall with a helmet pretty sometimes yeah, assuming it's you know,
Speaker 1: you're not going a hundred miles, but it was. I
Speaker 1: was an idiot it and anybody who like you say,
Speaker 1: when the Hell's angels say you're taking too much risk,
Speaker 1: you need to you need to head yourself a little
Speaker 1: bit with a helmet. You gotta pay attention. Um, So,
Speaker 1: who are your early mentors who affected the way you
Speaker 1: look at the world of innovation and franchise and managing institutions. Well,
Speaker 1: I think when I was really honest with my father,
Speaker 1: he was just not only an impressive scientist and a
Speaker 1: real believer in a bigger purpose which is kind of
Speaker 1: the search for truth and asking questions, but it was
Speaker 1: also incredibly impressive and motivating people. I think when I
Speaker 1: got to Stanford there was a scientist named Lenny Suskin
Speaker 1: who was like a disciple of Richard Feynman. He had
Speaker 1: this awesome style of really figure everything out for yourself.
Speaker 1: Like he said to me, Sophia, never want to see
Speaker 1: you in a library, really, And that's what Dick Feynman
Speaker 1: had told him. And it's when you have a problem
Speaker 1: that's sort of like underlying this book I came into
Speaker 1: you know, there's two hundred years of people thinking and
Speaker 1: writing about organization, and I just came from a completely
Speaker 1: different angle. And in part that's due to just think
Speaker 1: about things for yourself. Try to come up. Don't read.
Speaker 1: Actually the opposite, don't read and absorb what everybody tells
Speaker 1: you is to try to think of things from first
Speaker 1: principles in the business world, probably in your world. I
Speaker 1: one of my early board members was a guy named
Speaker 1: Bruce Kavner, I know the name, ran a very successful
Speaker 1: hedge fund called Caxton and he was a very deep,
Speaker 1: thoughtful thinker, and he, you know, he said little, but
Speaker 1: the little that he said was very thoughtful that would
Speaker 1: help you rethink the strategy, how players are acting in
Speaker 1: the world around you, strategy, competition, and so I got
Speaker 1: a lot of useful stuff from him as well, quite
Speaker 1: quite interesting. Let's talk about books. What are some of
Speaker 1: your favorite books? What are you reading? What do you
Speaker 1: recommend to people? Oh? My god, there's so many. By
Speaker 1: the way, this is the favorite question. I get more
Speaker 1: emails about this question than anything else. Many got it. Well, Firstly,
Speaker 1: I love biographies and I read so many biographies. But
Speaker 1: there's there's one. When I was writing that book, I
Speaker 1: was sort of three years in a cave and I
Speaker 1: was just there's so many histories I had to learn,
Speaker 1: and so many industries. So I was really focused on
Speaker 1: reading for that. There was only one author who made
Speaker 1: me stop and like read for fun that had nothing
Speaker 1: to do. His name is Scott Burke. He's a He
Speaker 1: wrote this awesome book on Charles Lindberg, the best book
Speaker 1: on Lindbergh, and it is such an incredible story because
Speaker 1: Lindburgh there really hasn't been a hero, an American hero
Speaker 1: like that in a century. People don't realize what a hero.
Speaker 1: When he completed that voyage over the Atlantic. At the time,
Speaker 1: flight was this crazy thing. People wouldn't weren't even taking
Speaker 1: odds on his life because it was so bad, so
Speaker 1: unlikely that this young kid would make it flying solo
Speaker 1: across the Atlantic. People across the country were praying for him.
Speaker 1: And when he came back, it's like a quarter million
Speaker 1: stories about him. He went on a tour of the
Speaker 1: United States, literally a third of the population not to
Speaker 1: see him, and that's and it's this incredible arc because
Speaker 1: he was more popular than FDR. He was this unbelievably
Speaker 1: popular guy, and f DR felt threatened, and FDR orchestrated
Speaker 1: this campaign against him that painted him as this Nazi sympathizer,
Speaker 1: appeasement sympathizer, anti Semite even and it just was not
Speaker 1: the case. But he was a very reserved guy and
Speaker 1: he didn't fight back, and so he got kind of
Speaker 1: tainted by a pretty orchestrated campaign against him. And just
Speaker 1: and he went from the most famous guy in the country,
Speaker 1: two people like you know, burning his books. It was
Speaker 1: just an unbelievable up and down. And then he redeemed
Speaker 1: himself in the Second World War. And just the life
Speaker 1: story is an incredible story, and anything Scott and that
Speaker 1: biographer is a beautiful writer and combines great storytelling with
Speaker 1: very accurate history. So before I ask you about more
Speaker 1: books you like biographies and obviously flying, did you read
Speaker 1: the McCullough book on the Right Brothers. It's on my list,
Speaker 1: but I haven't. It's it's I can't wait through, you can't,
Speaker 1: can't can't recommend enough. What else are you reading? What
Speaker 1: you know? Biographies? Um, I feel like I used to
Speaker 1: play competitive tennis in the juniors. Yeah, I am very
Speaker 1: late to the game of tennis. I picked it up
Speaker 1: in my fifties and I find it a fascinating and
Speaker 1: frustrating sports. I really enjoy it. Well. That an anecdote
Speaker 1: there is there was a guy I don't know if
Speaker 1: you know this name, but you know, when you're young
Speaker 1: and the juniors, you often go around to tournaments with
Speaker 1: there's somebody local and you're one of your dad's drives you.
Speaker 1: So the guy would go around to tournaments with him
Speaker 1: play all the time. Was with a guy named Lyle Menendez,
Speaker 1: and he became famous later unfortunately for murdering his parents. Yeah,
Speaker 1: so I began my life in crime with Eric. But
Speaker 1: were you? Were you any good? I was ranked in
Speaker 1: middle state really so, I mean Lyle was better, but
Speaker 1: I was pretty good. Um, but I grew up in
Speaker 1: sort of that. Andre Agassi Pete Sampras, the Andrea Agassi
Speaker 1: biography open. It's like one of the best sports biographies.
Speaker 1: It's I would never in a million years. Actually, you
Speaker 1: know what it's funny is that Pete Sampras wrote a
Speaker 1: biography first, and it was very good, especially if you
Speaker 1: like tennis, because you know it's it's good. And then
Speaker 1: Andrea Agassi comes out with his biography. Second, and he
Speaker 1: wins like that hand he beats Pete Finally, finally, he
Speaker 1: beats Pete off. It's a it's a it's not only
Speaker 1: a sports story, and but it's also called all this
Speaker 1: drama because he had this huge hatred of the sport
Speaker 1: and a huge love of the sport that came from
Speaker 1: his father. And then how he meets stephie Graff. It's
Speaker 1: an incredible love story, the love story and sports story.
Speaker 1: Give us one more book, one more book, one more book.
Speaker 1: Let's see. There is a book that I like by
Speaker 1: Gary caspar Off called about How Life Imitates Chess. It's
Speaker 1: a small book, but cass profits fascinating guy. I mean,
Speaker 1: really the longest reigning chess champion in history. And there
Speaker 1: he kind of breaks down what it was about how
Speaker 1: he approached the game that helped him become this, you know,
Speaker 1: the longest reigning chess champion in history, and it was
Speaker 1: some very interesting insights that actually I still apply to
Speaker 1: this day, which is that he when he makes a
Speaker 1: mistake or or loses a game, or even he wins
Speaker 1: a game, he doesn't ask what was wrong with that move?
Speaker 1: Why did you know? You know? Night to Bishop three
Speaker 1: was good or bad? He has what was in my
Speaker 1: mind that when I made that decision, What was my
Speaker 1: decision making process by which I arrived at that conclusion,
Speaker 1: and how should I improve my process. It's a little
Speaker 1: like an investor, I think. You don't say you lose
Speaker 1: money on an investment. You don't say, well, you know,
Speaker 1: the balance sheet was this, or the p was that,
Speaker 1: or the team was at and I should look at
Speaker 1: you say how did I decide? What was I thinking
Speaker 1: during that day? What are my mental checklists? And then
Speaker 1: you go back and try to change your mental checklists,
Speaker 1: so you gain much more than just the one understanding
Speaker 1: of the one move. Basically comes down to keep asking
Speaker 1: why why did you make that move? Always process versus results.
Speaker 1: If you focus too much on resulting, as any Duke
Speaker 1: called it and thinking and bets, you're drawing the wrong
Speaker 1: conclusion as opposed to what process led to that result.
Speaker 1: And in a very interesting and strategic way. Speaking of failure,
Speaker 1: tell us about a time you failed and what you
Speaker 1: learned from the experience. Oh, there was so many. I
Speaker 1: mean I don't even know where to start. They could
Speaker 1: be another hour. Um. In fact, when I first started
Speaker 1: a company, My favorite question was going around to all
Speaker 1: the successful people, any successful people that would take five
Speaker 1: minutes to talk to me, and ask what do you
Speaker 1: wish you'd done differently? And by the way, I asked
Speaker 1: that question to everybody who we talked to about renovating
Speaker 1: their kitchen, because we're about to start a kitchen renovation.
Speaker 1: What what did you like about the process? What what
Speaker 1: would you do differently? What mistakes did you make? And
Speaker 1: I have found that that question is great for everything.
Speaker 1: It's the best question. And I learned so much. And
Speaker 1: one of my mistakes was not listening enough to what
Speaker 1: I heard and uh, good advice ignored, you know, I mean,
Speaker 1: there's there's there's two kinds of failures where you do
Speaker 1: the right stuff but things don't work out. Like you
Speaker 1: do all the right stuff about developing a drug, but
Speaker 1: it just doesn't work and there's something fundamental about the technology.
Speaker 1: That's a good failure. That's a failure, but it's very
Speaker 1: depressing if you've spent years of your life or the
Speaker 1: team and you had all these high hopes and these
Speaker 1: it's it's it happens all the time, but still when
Speaker 1: you go through that and it's you know, people are
Speaker 1: crying their emotional because of all the promise that we
Speaker 1: thought we could do for the world and then it
Speaker 1: doesn't work. It's really and when you go through those
Speaker 1: hard times. I had a terrific hr guy who was
Speaker 1: a great advice are older than me, quite a bit older,
Speaker 1: and he was a former actually professional football player. He
Speaker 1: played for the Patriots in the NFL defensive back. So
Speaker 1: he had this great way about I mean, was you know,
Speaker 1: just tough, che feely enough to do the job well,
Speaker 1: but not so much that you're like, come on, so
Speaker 1: And one of the things in difficult times like that
Speaker 1: and failures like that, that you know he coached me
Speaker 1: on and coached all of us on, was how to
Speaker 1: make sure you treat people with dignity and fairness and
Speaker 1: how do you help them because relationships last longer than
Speaker 1: any company or any project, and so the importance of
Speaker 1: relationships and leading by relationships was incredibly powerful and the
Speaker 1: lesson that I really should have understood better when I
Speaker 1: was a young guy and asking people, you know all
Speaker 1: these you know, successful people, Almost invariably the number one
Speaker 1: answer I got about what do you wish you'd done differently?
Speaker 1: When I talked to successful CEOs off off the record
Speaker 1: was get rid of people faster, real hiring mistakes. I
Speaker 1: was too slow to make a change anyone who's gott
Speaker 1: into a large organization. As you you lead through your team,
Speaker 1: you don't really so much. And if you're trying to
Speaker 1: make individual decisions, you know it's going to be a
Speaker 1: big problem. But you lead through the team that you assembled.
Speaker 1: And almost everyone I talked to he said, I wish
Speaker 1: I'd move more quickly on some and some bad members.
Speaker 1: And uh, you know, ten or fifteen years later, I
Speaker 1: was saying the same thing because my mistake was me
Speaker 1: and some of the folks I worked. I was thinking like, oh,
Speaker 1: we have this bad problem. We think we can fix it.
Speaker 1: Sometimes you can't fix a problem. Sometimes you just need
Speaker 1: to make a change. So what do you do when
Speaker 1: for fun, when you're when you're not down in the
Speaker 1: c I a telling them how to save the world.
Speaker 1: What do you do for um to relax and kick back? Well?
Speaker 1: I have Uh my wife is pretty cool. So we
Speaker 1: got from long walks and we have two young kids.
Speaker 1: We just I could just sit and watch them and
Speaker 1: that's pretty cool. So now I do running. I don't
Speaker 1: have so much time for you know, tennis or or
Speaker 1: other endurance sports. But I go running and endurance sports.
Speaker 1: Uh yeah, I did tryathlon for quite a while, and
Speaker 1: uh you've replaced triathlon just with the running portion. Triathlon
Speaker 1: is another job. If you do kind of long distance
Speaker 1: like half fire and or iron. I did half firing
Speaker 1: it into Iron. I mean it's ten to fifteen hours
Speaker 1: a week of training, and it's a brutal race and
Speaker 1: of itself. I think everybody took the wrong lesson from marathons.
Speaker 1: Remember the first guy who arrived at Sparta, he dropped dead.
Speaker 1: That's right. That should have been a cautionary tale. Don't
Speaker 1: don't do that. But he didn't have good shoes. Well
Speaker 1: that's true. Um so in the world of and I
Speaker 1: don't even want to limit it to pharmaceuticals, in the
Speaker 1: world of large important institutions. What are you optimistic about
Speaker 1: and what do you pessimistic about looking forward? Well, I'm
Speaker 1: optimistic about the progress of medicine. I mean, we're just
Speaker 1: beginnings of growing organs in the lab. And speaking of
Speaker 1: we were talking about organ replacement if you're ride a motorcycle.
Speaker 1: But it's unbelievable. We just just recently just a few
Speaker 1: weeks ago, they are three D printing blood vessels onto
Speaker 1: early proto organs in the lab. And that's just just
Speaker 1: in the last few weeks. Imagine where will be five
Speaker 1: or ten years from now, and we're kind of on
Speaker 1: the verge of helping blind people see by rewiring the
Speaker 1: inputs to the brain if their eyes are fried, or
Speaker 1: helping deaf people here. It's just incredible the pace of
Speaker 1: science and medicine and where we might be ten twenty
Speaker 1: fifty years from now. What I'm concerned about is where
Speaker 1: that technology gets used for bad purposes, Specifically what we
Speaker 1: were talking about earlier in totalitarian regimes taking those some
Speaker 1: of those technologies, whether it's AI or machine or bioengineering,
Speaker 1: and what totalitarian regimes can do when they weaponize them,
Speaker 1: not only against others, but against their own people. It
Speaker 1: helps keep them in power. So I'm concerned about something
Speaker 1: that hasn't happened in the history of our species, which
Speaker 1: we are creating these new technologies which can actually help
Speaker 1: keep totalitarian regimes in power longer. And our final two questions,
Speaker 1: what sort of advice would you give to a recent
Speaker 1: college graduate who was thinking about a career either in
Speaker 1: pharmaceuticals or entrepreneurship. What would you advise them? Well, first
Speaker 1: of all, go around an experiment, because that's the only way.
Speaker 1: No amount of reading or listening to people tell you
Speaker 1: what you should or shouldn't do is going to replace
Speaker 1: trying something and just getting your hands wet with something.
Speaker 1: And the second thing is curiosity is ask people. Don't
Speaker 1: ask people, Go around and ask as many people as
Speaker 1: you cannot, how did you succeed? Because often people succeed
Speaker 1: because they got lucky. They were in the right place
Speaker 1: at the right time. And they're not going to tell
Speaker 1: you that, But ask them what we just talked about,
Speaker 1: which is what do you wish you'd done differently? Because
Speaker 1: that they've probably thought about a lot. If they're intelligent,
Speaker 1: thoughtful people, and they can have a pretty good answer
Speaker 1: because they've there's no I was in the right place
Speaker 1: at the wrong time. There's some people, if they're not
Speaker 1: very good at this, will say oh, I was unlucky.
Speaker 1: But the people who are much better and take lessons,
Speaker 1: we'll say, well, I should have done X, and I
Speaker 1: should have done why. That's a great thing to learn.
Speaker 1: And and my final question, what do you know about
Speaker 1: the world of organizations and decision making an innovation today
Speaker 1: that you wish you knew twenty plus years ago when
Speaker 1: you were first getting started. I would say it's important
Speaker 1: if you're running something of having people around you, whether
Speaker 1: they're inside your organization or oftentimes even better outside, who
Speaker 1: you can count on to tell you when you're being
Speaker 1: an idiot, to tell you the truth, because, especially if
Speaker 1: you're in some kind of position of authority, people don't
Speaker 1: want to tell you that if you have some influence
Speaker 1: over their lives. They have other things that they care
Speaker 1: about other than telling you the truth. So it's and
Speaker 1: sometimes it's important to get out of your organization, listen
Speaker 1: to people who are really out there and get different perspectives.
Speaker 1: So I wish I had done more of that. Quite fascinating.
Speaker 1: Thank you Sophia Picole for being so generous with your time.
Speaker 1: We have been speaking with the author of loon Shots
Speaker 1: how to nurture the crazy ideas that wind War's cure
Speaker 1: diseases and transform industries. If you enjoy this conversation, well,
Speaker 1: be sure to look up an inch or down an
Speaker 1: inch on Apple iTunes and you could see any of
Speaker 1: the previous three hundred or so such conversations we've had
Speaker 1: over the past five years. We love your comments, feedback
Speaker 1: and suggestions. Write to us at m IB podcast at
Speaker 1: Bloomberg dot net. If you're still here after three hours,
Speaker 1: well then go to Apple iTunes and give us a
Speaker 1: delightful review. You can check out my daily reads on
Speaker 1: rit Halts dot com. You can follow me on Twitter
Speaker 1: at rit Halts. I would be remiss if I did
Speaker 1: not thank the crack staff that helps put together these
Speaker 1: conversations each week. Carolyn O'Brien is my audio engineer on
Speaker 1: My head of research is Michael Batnick. Tracy Walsh is
Speaker 1: my project manager. I'm Barry rit Halts. You've been listening
Speaker 1: to Masters in Business on Bloomberg Radio