Speaker 1: You're listening to Math and Magic, a production of iHeartRadio.
Speaker 2: I'm constantly making a six. You're constantly learning, learning on
Speaker 2: these small failures so it avoids the big, big.
Speaker 3: Big miss.
Speaker 2: And so for me, the way I approach risk is
Speaker 2: encourage an organization to embrace innovation, to embrace change, constantly
Speaker 2: try things, and actually make it okay to fail, Actually
Speaker 2: celebrate those failures, actually talk about those things of what
Speaker 2: we learned and what we're going to go do about it.
Speaker 3: Hi, I'm Bob Pittman. Welcome to Math and Magic. Stories
Speaker 3: from the Frontiers and Marketing. On this episode, we're going
Speaker 3: deep with someone who has the Midas touch. These transformed brands,
Speaker 3: one after the other and company after company, moving from
Speaker 3: marketer to CEO. He's created enormous shareholder returns and we're
Speaker 3: going to dig into the hows today with Terang Amin,
Speaker 3: Chairman of the board and CEO at ELF Beauty. Terang
Speaker 3: was born in Kenya moved to the US as a child.
Speaker 3: Growing up, he helped his dad run the family owned
Speaker 3: hotel in Alexandria, Virginia, and went on to Duke University
Speaker 3: for undergrad and his MBA. Like many great execs, His
Speaker 3: training ground was PNG, and he spent time running brands
Speaker 3: for Pong and others before rising to his first CEO
Speaker 3: job in twenty eleven. He's a purpose driven, passionate leader
Speaker 3: who has been driving performance for over thirty years. He's
Speaker 3: committed to diversity and also to disruption and credits Boat
Speaker 3: for his remarkable success and to put that in perspective,
Speaker 3: he has grown the Elf Beauty business five x since
Speaker 3: arriving as CEO. Terang, Welcome, Well, thank you for having me.
Speaker 3: I want to dig into your story and it's fascinating story,
Speaker 3: but first I want to do you in sixty seconds.
Speaker 3: You ready sounds great? Do you prefer cats or dogs? Dogs? Early?
Speaker 2: Ryme, nightdowl early riser? West coast or East coast, West coast,
Speaker 2: city or country city, beach or mountains, beach, coffee or tea, tea,
Speaker 2: books or movies, movies, cook or eat out, cook, call
Speaker 2: or text call. Work life balance or work life integration.
Speaker 3: Integration. Okay, it's about to get harder. All time favorite
Speaker 3: music artist, you two, favorite TV show Seinfeld, smartest person
Speaker 3: you know, Fred Cohen, childhood hero Mohamma Gandhi. Favorite sport
Speaker 3: to watch Basketball, Favorite movie shash Ank Redemption, most important
Speaker 3: piece of advice you ever got, lean in, favorite city,
Speaker 3: San Francisco, favorite place to visit Africa, and the final one,
Speaker 3: secret talent gardening. Okay, great, let's jump in now. Know
Speaker 3: this is going to be a surprise, But you're actually
Speaker 3: not the first guest who grew up in their family motel.
Speaker 3: Shaji Vishram, the founder of Happy Baby, the organic baby
Speaker 3: food company, grew up in the family motel and Alabama
Speaker 3: Rooms one twenty three, and like you, she said, it
Speaker 3: taught her so much about life and business. So I
Speaker 3: am fascinated by this story. So can you paint the
Speaker 3: picture of that experience for you? Growing up in a motel,
Speaker 3: working all the time with your family, That was.
Speaker 2: A pretty formative experience for me. So when I was fourteen,
Speaker 2: we sold our house, took every penny we had, and
Speaker 2: we bought our first hotel on Route one in Alexandria, Virginia.
Speaker 2: We moved right into the manager's apartment, and our business
Speaker 2: model as a family was we'd find these distressed properties,
Speaker 2: we'd fix them up. We're good operators, and we kept
Speaker 2: building from there. You did everything. If the maze didn't
Speaker 2: show up, you made the rooms you rented, the rooms
Speaker 2: you renovated. It was such an important experience for me.
Speaker 2: Probably the most important is how you treat people. Because
Speaker 2: there were small motels or more on the budget side,
Speaker 2: we didn't have like high wages or other things, so
Speaker 2: it really came down to how did you motivate people
Speaker 2: who were oftentimes hourly and how did you incent kind
Speaker 2: of our managers over time in terms of you know,
Speaker 2: we had a model that if they hit certain criteria,
Speaker 2: we'd help finance their own property. So it was a
Speaker 2: great leg up and a way for them to really
Speaker 2: change their families' lives as well. I had a pretty
Speaker 2: classical career after that and large consumer goods, but I
Speaker 2: tell people everything I know about cash flow, economic profit,
Speaker 2: how you treat people really came from building our motel
Speaker 2: business up with my dad, and I did that from
Speaker 2: fourteen to about my mid twenties. Many many years later,
Speaker 2: I still pull from those experiences. My gosh, we could
Speaker 2: probably go on the entire podcast for everything I learned
Speaker 2: to the motels.
Speaker 3: In the nineteen nineties, I was on the board of
Speaker 3: a company called HFS which had a number of brands
Speaker 3: for motels, and I was always struck with that over
Speaker 3: representation in the ownership families. Why is that?
Speaker 2: You know, as you mentioned in your opening, we were
Speaker 2: immigrants from East Africa, and there are a number of immigrants,
Speaker 2: particularly when Idiamine came to power in Uganda and kicked
Speaker 2: all the Indians out, Kenya, other countries that immigrated to
Speaker 2: the US, and a lot of times where they kind
Speaker 2: of left behind whatever their original profession was or their
Speaker 2: business people. The motels were actually a really good model
Speaker 2: because with a limited amount of capital you could get alone.
Speaker 2: You could then actually not only live there, but earn
Speaker 2: a living and be able to go from there. So
Speaker 2: we're in India. Our ethnicities Gadratis, and a lot of
Speaker 2: Gadratis got into the motel business. I think it's still
Speaker 2: a huge proportion of the motels in the US are
Speaker 2: owned by Gadratis. And like any immigrant family, immigrant community,
Speaker 2: when someone gets into it, others learn that there's something
Speaker 2: there and so I'm not unique in having that experience.
Speaker 2: There are number of Ztratis in the US that also
Speaker 2: had their start in these motels.
Speaker 3: Did you ever think about staying in the business, You know, I.
Speaker 2: Didn't and my parents didn't want me to either. There
Speaker 2: was a real focus, particularly drive the community on education,
Speaker 2: and so my parents were very set and I was
Speaker 2: very set on going to university, going to grad school,
Speaker 2: figuring out what I really wanted to do. And so
Speaker 2: I would say it never was an aspiration as much
Speaker 2: as I learned from it, I was definitely interested in
Speaker 2: wanting to explore the world and do different things.
Speaker 3: You were obviously a good student. You went off to
Speaker 3: Duke for undergrad and grad school too, and you have
Speaker 3: an interesting story when you applied to the graduate School
Speaker 3: of Business when you were still an undergrad and they
Speaker 3: told you you had no business experience.
Speaker 2: How did you use that motel experience to become that
Speaker 2: objection the dean of admissions. Since I was an undergrad
Speaker 2: and done a lot of leadership things at Duke, you know,
Speaker 2: you told me like, no, we don't accept people straight
Speaker 2: out of undergrad. You need to go work. I basically,
Speaker 2: I think, in about twenty minutes, described what my work
Speaker 2: experience was in the motels, and it must have been
Speaker 2: persuasive enough for him to let me in a great story.
Speaker 3: A stunning number of marketing focused CEOs got their startup PNG.
Speaker 3: Actually surprising number of people that are on math and
Speaker 3: magic got their startup P ANDNG. Why is that such
Speaker 3: a fertile ground.
Speaker 2: I actually went to p ANDNG almost by accident. I
Speaker 2: did my undergraduate major in international policy. I thought I
Speaker 2: was going to go do my MBA, to go work
Speaker 2: at the World Bank, and then my name showed up
Speaker 2: on some close lists for Proker and Gamble. To be
Speaker 2: honest with you, I didn't even know what it was,
Speaker 2: but what intrigued me about it was this notion that
Speaker 2: in your mid twenties you could go run a brand,
Speaker 2: and that really appealed to me of the ability to
Speaker 2: be able to really get into every aspect of the business,
Speaker 2: the whole aspect of consumers and understanding them, being able
Speaker 2: to translate insights into action, and so I thought it
Speaker 2: was a really great experience for getting a great overview
Speaker 2: of almost every functional area moving a business forward, what
Speaker 2: the brand stood for, and so I really loved my
Speaker 2: time at PNG. It definitely was a great training ground,
Speaker 2: as many others have experienced.
Speaker 3: One of your first big successes, I guess was a
Speaker 3: p ANDNG when you were part of the team that
Speaker 3: relaunched Panteen, taking it from a I think the numbers
Speaker 3: are right. Of fifty million dollar haircare brand to a
Speaker 3: two billion dollar global market leader. How did that happen?
Speaker 2: That was a really formative experience because I spent eight
Speaker 2: years on Canteen.
Speaker 3: It was my beauty.
Speaker 2: I did almost every possible role in that business. Panteen
Speaker 2: it existed for fifty years. It was almost on its
Speaker 2: last legs. P ANDNG had gotten it through the Richardson
Speaker 2: Vicks acquisition in the mid eighties, and by the time
Speaker 2: I got on in nineteen ninety one, it still only
Speaker 2: had fifty million dollars of sales, and there was one
Speaker 2: failed relaunch after another. But the core of the brand
Speaker 2: was this intersection between health and beauty, and I remember
Speaker 2: we had a line we came out of hair so
Speaker 2: healthy it shines, And like I think many great businesses,
Speaker 2: it was the timing of a lot of things coming
Speaker 2: together at the same time. These incredible flowing hair shots.
Speaker 2: We put our two and one technology, put a conditioner
Speaker 2: on it, did a lot of fundamentals, and it just
Speaker 2: took off in the early nineties.
Speaker 3: Long straight hair is in fashion.
Speaker 2: But the best part of the Canteen story I tell
Speaker 2: people all the time is we probably hit a wall
Speaker 2: at least four times on that business where you would
Speaker 2: grow really fast and the kind of plateau out and
Speaker 2: the growing fast and platau out is that ability of
Speaker 2: discovering what was aspirational yet achievable for consumers and how
Speaker 2: we continue to pivot that brand. But it was a
Speaker 2: great experience, including help in take it global.
Speaker 3: You know, it's an interesting point you mean about hitting
Speaker 3: sort of the plateau, and I think all of us
Speaker 3: have built products. You know, you go grow, grow, grow,
Speaker 3: and then it slows down. How did you hit those?
Speaker 3: It's interesting to me because very few people get over those.
Speaker 3: That sort of is now the new high. Can you
Speaker 3: give me an example of a couple and just tell
Speaker 3: us how you got over it?
Speaker 2: I mean, heck, I'll even give you an example. In
Speaker 2: my current role at elf Beauty, very fast growing brand
Speaker 2: in twenty eighteen, we hit a wall and we couldn't
Speaker 2: figure out it. First, We're like, well is that our
Speaker 2: value equation? It's something wrong with the product. And what
Speaker 2: we realized is a bunch of mega influencer brands came
Speaker 2: into our space, the Kylie Jenner's, the Fentees, the Buddha Beautyes,
Speaker 2: And at first I thought our value proposition would insulate us,
Speaker 2: but we found that no, they were taking all the
Speaker 2: attention for consumers, and we weren't spending enough on the brand.
Speaker 2: So I think the most important thing is to step
Speaker 2: back and really get into where did we go wrong?
Speaker 2: And it starts first and foremost with myself. I remember
Speaker 2: get in front of our leadership team and saying, these
Speaker 2: are my beliefs, and let me tell you where we
Speaker 2: went wrong on each of these areas. We used to
Speaker 2: brag that our value was so great we didn't have
Speaker 2: to spend money on marketing, and I was dead wrong
Speaker 2: on that. We were getting lost in all the noise
Speaker 2: we'd gotten into retail stores. Yet many of those retail
Speaker 2: stores were in malls that would never see a better day.
Speaker 2: And then we basically got distracted. And so I think
Speaker 2: the first thing was really I always tell people we
Speaker 2: can face any reality, you just got to know what
Speaker 2: the reality is. So I think the first step is
Speaker 2: really getting a better understanding of what's what are the
Speaker 2: drivers or what's not working, and then making bold moves.
Speaker 2: I remember it was painful, but back in twenty nineteen,
Speaker 2: on the same day we shut down all of our
Speaker 2: retail stores we sent We had twenty six stores, spent
Speaker 2: twenty six leaders to every store to let people know
Speaker 2: what was going on and why we paid more than
Speaker 2: market for severance. But it was still painful letting two
Speaker 2: hundred associates go. But then we took the sixteen million
Speaker 2: dollars or spending those stores, and we doubled down on
Speaker 2: our digital business and we saw almost immediate results.
Speaker 3: So I would say two things.
Speaker 2: One, understand what the reality is, and then make sure
Speaker 2: you're taking decisive action and not just wishing that things
Speaker 2: will get better.
Speaker 3: You think it's hard, but I see this in business,
Speaker 3: and I'm seeing it watching others, certainly seeing it with myself.
Speaker 3: Hard for people to sort of own up to it's
Speaker 3: not working, we've got a problem.
Speaker 2: Yeah, I think there's a natural human tendency to wish
Speaker 2: for that it's going to get better. I feel like
Speaker 2: that's an important role for a leader because others see it.
Speaker 2: People in your organization will know when something's not working,
Speaker 2: and they want leaders who own up to it. That
Speaker 2: basically say hey guys, this isn't great. Let me tell
Speaker 2: you where I believe I went wrong, let me tell
Speaker 2: you what I'm doing about it, and it then role
Speaker 2: models others to be able to step up and say, Okay,
Speaker 2: there's nothing wrong with saying where have we failed and
Speaker 2: what do we have to do about it?
Speaker 3: And I think it brings the team together. I'm going
Speaker 3: to go back a little bit. You went on to
Speaker 3: some big successes at Clorox after P and G, and
Speaker 3: you got your first CEO shot. How did you make
Speaker 3: the jump to CEO? You were obviously doing great with
Speaker 3: the brands, great marketer, et cetera. But that's a big
Speaker 3: jump to CEO.
Speaker 2: I think one of the things that really helped me
Speaker 2: throughout my career is I started in marketing and then
Speaker 2: I went over to more of a general managed role
Speaker 2: than I went back deeper into marketing than before my
Speaker 2: first CEO role. I was a general manager over three
Speaker 2: of the divisions at Clorox, So I had a good
Speaker 2: combination of going deep in a particular area and then
Speaker 2: going broad and learning the other functional areas. And so
Speaker 2: I felt by the time I was GM of Clorox
Speaker 2: businesses Kingsford Charcoal, Hitting Valley Ranch dressings, a fresh step
Speaker 2: in litter. They were pretty autonomous. They had their own
Speaker 2: supply chain, they had their own way of kind of distribution,
Speaker 2: and so I felt like it was a good training
Speaker 2: ground for me to really make sure I was adept
Speaker 2: at the different functional areas, but more importantly, continue to
Speaker 2: hone my leadership skills. And so when my first CEO
Speaker 2: opportunity came up, it was a small company called Shift Nutrition,
Speaker 2: it was a publicly traded company, private equity backed, I
Speaker 2: felt well prepared. I knew the areas that I could go,
Speaker 2: and particularly in terms of like how we build the team.
Speaker 2: My professional background is I'm absolutely passionate about building brands.
Speaker 2: The best way in how you build brands is you
Speaker 2: lead the innovation in the category. But what I love
Speaker 2: doing the most is assembling these high performance teams. I
Speaker 2: always bragged that in thirty four years of being in
Speaker 2: the consumer space, I've never had a business we haven't
Speaker 2: grown multiples of the category. And I always attributed that
Speaker 2: back to the team and the culture that we create,
Speaker 2: and so that gave me a lot of confidence to
Speaker 2: jump in and take my first ro.
Speaker 3: I'll brag on you for a second here. You grew
Speaker 3: that enterprise value from one hundred and ninety million to
Speaker 3: one point five billion in just a couple of years.
Speaker 3: So obviously got a big success there, but you moved into,
Speaker 3: as you said, a public company. You know, part of
Speaker 3: the CEO job is running the business. The other parts
Speaker 3: dealing with shareholders A doubt in your background, you've had
Speaker 3: a lot of training on dealing with the investors. How
Speaker 3: did you learn that side of the business.
Speaker 2: Well, it definitely was a pretty steep learning curve. I
Speaker 2: remember my first earnings call it shift nutrition. I said something.
Speaker 2: I had gotten a stat from one of our team
Speaker 2: members and it was wrong, and I had to issue
Speaker 2: I think, an okay on what I said wrong. But
Speaker 2: there's no hesitancy in terms of being transparent of like,
Speaker 2: you know that was the wrong numbers. I just told
Speaker 2: you here's what it is. So I would say, you know,
Speaker 2: from that rough start, the thing that's helped me the
Speaker 2: most is I love being a CEO of a public company.
Speaker 2: A lot of people don't, but I love it because
Speaker 2: there's one hundred percent transparency. The internal story and the
Speaker 2: external story have to be the same one, and I
Speaker 2: think that interaction with investors and others makes you sharper
Speaker 2: in terms of what are people getting, what are people
Speaker 2: not getting? What is that narrative? I'd say The second
Speaker 2: thing that's been most important is some people spend too
Speaker 2: much time on the public company thing and managing investor relations.
Speaker 2: I have always had the discipline of I will never
Speaker 2: let a quarter get in the way of our long
Speaker 2: term focus and strategy, and then also constrain the time
Speaker 2: where you know you can take a life of its own.
Speaker 2: I give investor relations two days a quarter, one day
Speaker 2: in prepping for what the earnings release and the narrative
Speaker 2: and talking with investors, and then maybe a second day
Speaker 2: to do a conference or some investor relations.
Speaker 3: I feel some.
Speaker 2: Of my peers as CEO spend in an order amount
Speaker 2: of time on that part of the business, and I
Speaker 2: think if you're spending too much time on that part,
Speaker 2: it's getting in the way of where you really need
Speaker 2: to focus on, which is the team and your strategy.
Speaker 3: More of Math and Magic right after this quick break,
Speaker 3: welcome back to Math and Magic. Let's hear more from
Speaker 3: my conversations with terrag Amm. We had a real success
Speaker 3: and then you made them move to ELF. Why did
Speaker 3: you make the move?
Speaker 2: We had a great run at Shift. We ended up
Speaker 2: selling the company to Recabin Kyser. I then took a
Speaker 2: few months off and I looked at a lot of
Speaker 2: different businesses, and I'll tell you my path to ELF
Speaker 2: was a series of fortunate accidents. I was asked to
Speaker 2: take a meeting to see this private company that was
Speaker 2: going to be for sale, and at first I said, no,
Speaker 2: I'm not interested in color cosmetics. There are too many brands,
Speaker 2: too low barriers of entry. It really wasn't interested in
Speaker 2: the category. But I also have an adage that says
Speaker 2: never hurts to have a conversation, So under that rule,
Speaker 2: I said all right, I'll take the meeting and instantly
Speaker 2: fell in love with the business. Actually, today's my eleventh
Speaker 2: anniversary of bing Ceol.
Speaker 3: Congratulations, thank you, so.
Speaker 2: A little bit over eleven years ago I took that
Speaker 2: first meeting and at that time the company was already
Speaker 2: ten years old. And what I loved about the story
Speaker 2: was the company was founded by a father and son entrepreneurs.
Speaker 2: So I tend to be attractive to other entrepreneurs and founders,
Speaker 2: and I loved their story. Alan Shama, the father, wanted
Speaker 2: to go into business with his son Joey. They started
Speaker 2: studying what categories could they disrupt, and they couldn't figure
Speaker 2: out why did people charge so much? Money in cosmetics.
Speaker 2: They had a lot of friends that were doing business
Speaker 2: with the Dollar Channel, Dollar General Family Dollar, and so
Speaker 2: they said, what could we do that we could sell
Speaker 2: for a dollar? And Alan will tell me many times trying,
Speaker 2: I don't know as many things as you do, but
Speaker 2: I know how to buy a shirt for two dollars
Speaker 2: and sell it for four. And that novice approach. They
Speaker 2: completely turned cosmetics upside down because their original business model
Speaker 2: was if the Dollar Channel was the retailer for a dollar,
Speaker 2: they're going to buy it for me each piece for
Speaker 2: fifty cents. I'm going to have to figure out how
Speaker 2: to make it for thirty five cents. And they figured
Speaker 2: it out. Everyone thought they were crazy at the time,
Speaker 2: like you couldn't sell cosmetics for a dollar. And of course,
Speaker 2: what I love about many entrepreneurs stories is you always
Speaker 2: have to pivot. They then went to the Dollar Channel.
Speaker 2: A Dollar Channel said no, we're not in interested, and
Speaker 2: they're like, what wait, we put all this effort in,
Speaker 2: what do you mean you're not interested? And Joey meanwhile
Speaker 2: had gotten one of their eyeliner pencils to an editor
Speaker 2: at Glamour and he said, oh my gosh, I can't
Speaker 2: believe this is a dollar. I would love to write
Speaker 2: about it, but you have to be in distribution. She's like,
Speaker 2: you know, even if you had a website. And so
Speaker 2: in two thousand and four, predating the iPhone, they started
Speaker 2: a website called islipspace dot com selling cosmetics over the
Speaker 2: internet for one dollar. Like I said, everyone thought they
Speaker 2: were crazy. You couldn't sell cosmetics for a dollar. You
Speaker 2: certainly could make money over the internet at a buck each,
Speaker 2: but they figured it out. So that initial story of
Speaker 2: how disruptive they were really appealed to me. I love
Speaker 2: the digitally native roots, I love the value orientation. But
Speaker 2: then what I saw was real potential in terms of
Speaker 2: what we could do. They had just gotten into target.
Speaker 2: They were highly productive in target, but they weren't in
Speaker 2: distribution anywhere else. And so I love the story so
Speaker 2: much I decided to jump in and co invest with
Speaker 2: the private equity company and we bought the company back
Speaker 2: in twenty fourteen.
Speaker 3: Wow. Well, just I'm just going to put some context
Speaker 3: for everyone listening today is you have taken ELF from
Speaker 3: two hundred million in revenue over a billion, and your
Speaker 3: stock has gone from seventeen dollars to two hundred dollars,
Speaker 3: five x revenue growth, ten x stock growth. Pretty remarkable
Speaker 3: performance coming out of that, and I want to dig
Speaker 3: a little more into it, and I'll come to it,
Speaker 3: but I want to sort of ask you a little bit,
Speaker 3: because it keeps coming up here is your career is
Speaker 3: filled with risky decisions. How do you think about risk?
Speaker 2: It was funny my first CEO role the pe firm
Speaker 2: that hired me. I remember it was the last dinner
Speaker 2: where whether I was going to get the job or not.
Speaker 2: They basically were like, oh, we looked at your background
Speaker 2: and we don't like that you haven't had any big
Speaker 2: public failures.
Speaker 3: And at first I was a little confused.
Speaker 2: I was like what, and they're like, yeah, I know,
Speaker 2: you've had a lot of success, and we like our
Speaker 2: CEOs to have some big stumble. We feel it makes
Speaker 2: some hungrier for what we do. I asked them, I said, okay,
Speaker 2: do you mean to give you the flippant answer or
Speaker 2: the real answer? They said, well, now that you say that,
Speaker 2: do both, and I saorry the flippant answers don't make
Speaker 2: me apologize for not being a loser, and they loved it.
Speaker 2: I feel like I had the job right then, And
Speaker 2: I said, but if you want the real answer, if
Speaker 2: you ask me what mistakes I've made, I would respond,
Speaker 2: since this morning, I'm constantly making a six. You're constantly learning.
Speaker 2: So what ends up happening is you're learning on these
Speaker 2: small failures, so it avoids the big, big.
Speaker 3: Big miss.
Speaker 2: And so for me, the way I approach risk is
Speaker 2: encourage an organization to embrace innovation, to embrace change, constantly
Speaker 2: try things, and actually make it okay to fail, actually
Speaker 2: celebrate those failures, actually talk about those things of what
Speaker 2: we learned and what we're going to go do about it.
Speaker 2: And so I think some people, when it comes to risk,
Speaker 2: are trying to mitigate every possible thing that can go wrong.
Speaker 2: And like I said, I think that's a fallacy. I
Speaker 2: think really paying attention and focusing on what could really
Speaker 2: send us sideways. Let's focus on those few things. But otherwise,
Speaker 2: let's encourage people to keep moving forward, keep trying things,
Speaker 2: and learn from them so we can continue to innovate.
Speaker 3: That's great advice and a great perspective. I've always loved
Speaker 3: the folks who say success and failure are the same thing.
Speaker 3: They're stepping stones. One you learn more from us, right,
Speaker 3: which is the failure. It seems like a very big
Speaker 3: part of who you are as CEO is your commitment
Speaker 3: to diversity, equity, and inclusion, and it begins at the top.
Speaker 3: Can you talk a little bit about that commitment to
Speaker 3: diversity and how it helps your company and your business
Speaker 3: and how purpose driven separates you from others.
Speaker 2: It starts first with when we bought the company, this
Speaker 2: intention of we want to reflect the community we serve.
Speaker 2: So I'm really proud from our employee base. Our employee
Speaker 2: base is seventy four percent women, and I think almost
Speaker 2: seventy five percent gen Z and millennial forty four percent diverse.
Speaker 2: We're very intentional of like, let's make sure we're reflecting
Speaker 2: the people that we're serving. There was no DEI program
Speaker 2: of quotas. There was just this intention of let's be
Speaker 2: crystal clear of who are we serving, who's our community,
Speaker 2: and how do we have people that reflected. It's one
Speaker 2: of our biggest competitive advantages because we don't have to
Speaker 2: do focus groups, we don't have to go do a
Speaker 2: bunch of research. Our employees are the people that we're serving.
Speaker 2: They have incredible insights and incredible knowledge and ability to
Speaker 2: move forward, but we didn't want it to stop with
Speaker 2: our employees. I remember when we went were decided to
Speaker 2: go public. You know, I want to have a board
Speaker 2: that also reflects the people that we're serving and more importantly,
Speaker 2: has real diversity of thought that can really push our thinking.
Speaker 2: My view of the board is, not only do they
Speaker 2: responsibility shareholders, but it's a total waste of time if
Speaker 2: you're not getting the smartest people you know, with very
Speaker 2: different backgrounds helping push management teams on things that we're
Speaker 2: not seeing. And so our stats on our board standpoint
Speaker 2: is I think we're one of only two companies now
Speaker 2: out of forty one hundred that has a board that's
Speaker 2: seventy eight percent women and over forty four percent diverse.
Speaker 3: And it's more than the stats.
Speaker 2: It's the different experience that say bring, the different thought
Speaker 2: processes that really just help me and the team.
Speaker 1: You know.
Speaker 3: Another big part of what you do is as a disruptor.
Speaker 3: Clearly it's part of your culture. How have you built
Speaker 3: that into the culture and how have you harnessed it
Speaker 3: for growth?
Speaker 2: I think the spirit of disruption for us has been
Speaker 2: there from the very beginning, and I think, like many
Speaker 2: digitally native businesses. There is definitely a culture of testing
Speaker 2: and learning. Let's go try things, let's put it online,
Speaker 2: see what happens, and let's get those signals from our
Speaker 2: community and consumers what they respond to. But I think
Speaker 2: the other thing is the team, And importantly it's not
Speaker 2: just the team composition, but the culture put them in.
Speaker 2: Where a culture of high performance teamwork, where you building
Speaker 2: passion relationships, You're giving each other feedback, you have a
Speaker 2: lot of mutual accountability, makes it a safe place to
Speaker 2: disrupt and try things. And then then I think once
Speaker 2: you start disrupting, you continue to disrupt because one leads
Speaker 2: to the other and that becomes the norm.
Speaker 3: You know.
Speaker 2: One of the things we do to be able to
Speaker 2: encourage that as well is all the way to our
Speaker 2: compensation system. It was very important to me, almost going
Speaker 2: back to my motality is I saw the power of
Speaker 2: owning something. So I insisted both at SHIFT and ELF,
Speaker 2: every employee has to be a shareholder. It was a
Speaker 2: big fight. When I remember I first got to SHIFT,
Speaker 2: They're like, you know the private equity was like, no,
Speaker 2: that's not our model. We only give equity to the
Speaker 2: top team. And I'm like, well, well give me performance
Speaker 2: incentives from my equity, so we can give equity to everyone.
Speaker 2: And I saw the power of that at SHIFTS, so
Speaker 2: it wasn't even a debate at ELF. I think we're
Speaker 2: one of the few companies in our space that gives
Speaker 2: meaningful equity to every single employee every year. So it
Speaker 2: gets to that ownership, that level that I talk about
Speaker 2: where we're in it together.
Speaker 3: I think sin's our IPO.
Speaker 2: We've given if you exclude the exec team, one hundred
Speaker 2: and eighty million dollars of equity in the stock that's
Speaker 2: gone up at least sevenfold, and so meaningful wealth creation
Speaker 2: for our team. And I'm very explicit about that because
Speaker 2: if people are owners, they just have much more skin
Speaker 2: in the game, Like we're all owners, let's keep moving forward,
Speaker 2: let's keep trying things. I think then builds upon itself
Speaker 2: in that culture.
Speaker 3: On a personal level, how do you think about work
Speaker 3: and your family and personal life. I can imagine growing
Speaker 3: up running the motel it was sort of one and
Speaker 3: the same. How do you think about it now?
Speaker 2: That's been very much part of my whole life. It
Speaker 2: has been one and the same. When you're running a
Speaker 2: motel business, it's a twenty four to seven business, you're
Speaker 2: with your family.
Speaker 3: It's all together.
Speaker 2: And I think for me, a lot of people talk
Speaker 2: about work life balance. For me, they're one and the same.
Speaker 2: My personal life, my work life, they are so intertwined.
Speaker 2: So it's very much a family affair. One of the
Speaker 2: things my wife and I love doing is we do
Speaker 2: these this series called Afternoon with the Means, where we'll
Speaker 2: invite our key leaders and their spouses or partners to
Speaker 2: our house for an afternoon as a way of thanking
Speaker 2: them for what they're doing, the way of getting to
Speaker 2: know them better. I love what I do at work,
Speaker 2: I love my personal life, and I love that they're
Speaker 2: both together.
Speaker 3: Let's jump to some quick topics brand building. How do
Speaker 3: you think about brands? How do you build them?
Speaker 2: I feel brands sort of living, breathing things and that
Speaker 2: constantly evolve and need to be nurtured. And so I
Speaker 2: think of a brand of what is something represent in
Speaker 2: a consumer's mind and what does it stand for, well
Speaker 2: beyond any functional attributes or benefits and so, and I
Speaker 2: love over my career being able to see kind of
Speaker 2: how brands grow, how they evolve that they stand for.
Speaker 3: Let's go to some advice. If someone wants to succeed
Speaker 3: running a company, what's the most important advice you could
Speaker 3: give them?
Speaker 2: I would say the most important advice is work on
Speaker 2: your peer to peer relationships. A lot of people spend
Speaker 2: too little time understanding other functional areas, understanding what makes
Speaker 2: people tick, how you work together, and most importantly, giving
Speaker 2: that feedback, because I think where people often fail is
Speaker 2: they never knew what hit them or detracted from them.
Speaker 2: And so being able to really make sure that you
Speaker 2: develop that way of listening really well and providing feedback
Speaker 2: I think are probably two of the most important skills
Speaker 2: in running anything.
Speaker 3: You've had a spectacular career and you've made some great choices.
Speaker 3: How do you know it's time to change jobs? An
Speaker 3: advice there, I would say, you got to love what
Speaker 3: you're doing.
Speaker 2: I have one of my eighty twenty rules is eighty
Speaker 2: percent of what you work on, you got to love
Speaker 2: twenty percents. You know the nonsense we all have to
Speaker 2: deal with. Whenever they gets out of whack, then you've
Speaker 2: got to you almost got to do a time out
Speaker 2: and say, okay, we got to renegotiate what's going on here.
Speaker 2: I've got to change something and so for me, unless
Speaker 2: you have true passion of what you're doing, you're probably
Speaker 2: not doing the right thing. And so I would say
Speaker 2: making sure you're taking those moments of introspection of am
Speaker 2: I truly happy? Am I loving what I'm doing? Am
Speaker 2: I actually good at what I'm doing? And how do
Speaker 2: I get better? And if you don't have that fundamental
Speaker 2: passion and curiosity, then I'd say it's probably time to
Speaker 2: do something different.
Speaker 3: College. Does everybody need to go to college?
Speaker 2: No? I don't even know where what schools most of
Speaker 2: the people I work with went to. It's about curiosity,
Speaker 2: learning and wanting to get better and never bought into
Speaker 2: yet to be credentialed in a certain way to be
Speaker 2: effective in life. I love my college experience. It was
Speaker 2: just a great platform to continue to learn. But I'd
Speaker 2: say one of the other's secrets of being successful is
Speaker 2: never feel like you know anything, always being curious, always
Speaker 2: asking questions, always wanting to get better, always surrounding yourself
Speaker 2: with great people. That is so much more important than
Speaker 2: any particular credential or environment. You know.
Speaker 3: It's interesting we hear the word curiosity a lot, and
Speaker 3: talking to other leaders, it's actually part of our company's
Speaker 3: values is curiosity probably one of the most important things.
Speaker 3: It's interesting to hear you define that as sort of
Speaker 3: this important thing just for life and career. Final advice,
Speaker 3: if you could go back in time and give some
Speaker 3: advice to your twenty one year old self, what would
Speaker 3: that advice be.
Speaker 2: That advice would be embrace what you think is risky
Speaker 2: or what you're worried about. I mean, I got married
Speaker 2: at a pretty young age. I was the only kind
Speaker 2: of breadwinner, and I was very happy at PNG. But
Speaker 2: there's an entire revolution happening on the internet, and I
Speaker 2: was a little risk verse or reluctant to kind of say, hey,
Speaker 2: I should just take the leap when things are going
Speaker 2: well to go pursue something that I thought was really interesting.
Speaker 3: And I'd say so.
Speaker 2: My biggest advice is the advice somebody once gave me,
Speaker 2: which is lean in, say yes, try something different, and
Speaker 2: don't be so worried about what if it doesn't work.
Speaker 3: We end each episode of Math and Magic with a
Speaker 3: shout out to those who've influenced us the most. From
Speaker 3: two sides, the analytical side. Some people call them quants,
Speaker 3: some people call them data people. Some people say in
Speaker 3: pattern recognition, people, etc. But the math side and the
Speaker 3: other person we want to give a shout out to
Speaker 3: is that sort of creative genius, the promotional, the art,
Speaker 3: the magic. Who are your two?
Speaker 2: So on the math side, I would say Jensen. Want
Speaker 2: just love his story and his vision, but more importantly
Speaker 2: than vision and perseverance is ability to get that done
Speaker 2: and the progress and videos made. It's just been incredible,
Speaker 2: very in.
Speaker 3: All of that on the magic side.
Speaker 2: On the magic side, I would say Mike Cesario, the
Speaker 2: founder and CEO of Liquid Death. I just love that
Speaker 2: he made a can of water an object of desire
Speaker 2: turned it into the art of entertainment. I think that's magic.
Speaker 2: I also love the fact that they start with a
Speaker 2: very simple question, which is, what's the dumbest thing we
Speaker 2: can do?
Speaker 3: You know, dumbest thing.
Speaker 2: You can do is take a can of water and
Speaker 2: make it something that's cool. And then they're constantly I
Speaker 2: feel like this ability of normalizing the bizarre. I just
Speaker 2: feel like it's quite magical what he and his team
Speaker 2: are doing.
Speaker 3: Terang, what an unusual and inspiring story you have, but
Speaker 3: personally and professionally and what unique and wildly successful company
Speaker 3: you've had huge congrats thanks for sharing your insights. Here
Speaker 3: are a few things I picked up from my conversation
Speaker 3: with Terang. One, Transparency is a superpower. One of the
Speaker 3: reasons Durang loves running a public company is because it
Speaker 3: requires him to be open and honest. His commitment that's
Speaker 3: parency extends to every part of his work, from admitting
Speaker 3: when he's wrong and embracing failure as an opportunity to
Speaker 3: pivot and grow. Transparency can be the key to unfettered creativity, innovation,
Speaker 3: and disruption. Two. Incentivize employees can be so much more
Speaker 3: than a pep talk to rank takes accountability and ownership seriously,
Speaker 3: and not only at the executive levels. From compensation to collaboration,
Speaker 3: there can be concrete offerings at opportunities for growth, regardless
Speaker 3: of someone's role or seniority. Depending on the goals you set,
Speaker 3: this can have far reaching effects on sales and innovation
Speaker 3: in addition to culture and teamwork. Three, Diversity can be
Speaker 3: woven into the fabric of success. The advantages of employing
Speaker 3: people with a multitude of perspectives and experiences can't be
Speaker 3: boiled down into a single goal, quota, or initiative. Diversity
Speaker 3: can serve a company in countless ways, especially when it's
Speaker 3: built into every level of operation, from day to day discussion,
Speaker 3: product testing and marketing, the board level strategizing. I'm Bob Pittman.
Speaker 3: Thanks for listening. That's it for today's episode.
Speaker 1: Thanks so much for listening to Math and Magic, a
Speaker 1: production of iHeart Podcasts. The show is created and hosted
Speaker 1: by Bob Pittman. Special thanks to Sydney Rosenbloom for booking
Speaker 1: and wrangling our wonderful talent, which is no small feat.
Speaker 1: The Math and Magic team is Jessica Crimechich and Baheed Fraser.
Speaker 1: Our executive producers are Ali Perry and Nikki Etoor. Until
Speaker 1: next time.