Transcript of 706: Daniel Lubetzky - KIND Snacks Founder & Shark Tank Investor on Kindness, Grit, Values-Driven Leadership. and Building a Billion-Dollar Brand

I have just opened applications for our Learning Leader Circle. I thought it would be useful to read a testimonial from a longtime veteran member of our Learning Leader Circle, Amanda Wilson, the founder and CEO of Brightwork. Here's what Amanda said, quote, when I stop and consider the key decisions that have been directly additive to the growth of Brightwork, Pursuing the Learning Leaders Circle stands out front and center. Since joining, I've become a better leader, more in tune with my team and clients, and more conscious of what that means for our future. I've experienced 20% growth in my business and gained lifelong friendships. Spending time amidst inspirational leaders who you learn are facing similar problems Whew, what perspective it has brought. Leadership can be lonely, and this group makes leading a journey with a companionship along the way. Ryan is a tremendous facilitator of the group discussions, but goes above and beyond by providing so many resources. He has been instrumental in helping me stay curious and obtain professional and financial goals. If you would like to apply to be part of our next Learning Leaders Circle, Go to learningleaderscircle.com. Welcome to the Learning Leaders Show presented by Insight Global.

I am your host, Ryan Hawk. Thank you so much for being here. Go to learningleader.com for show notes of this and all podcast episodes. Go to learningleader.com. Now on to tonight's featured leader. Daniel Lubetzky graduated from Stanford Law School. And then declined lucrative job offers to start his own business, only paying himself $24,000 a year for a decade. But then he founded KIND and grew it into a snack brand that Mars later valued at $5 billion and went on to acquire. Today, he invests full-time on Shark Tank, and he's the son of a Holocaust survivor who That story has shaped everything Daniel has built. During our conversation, we discuss the difference between a scarcity mindset and one of abundance. Daniel shares a fascinating story about how he changed his mind about giving away product and how it changed everything for Kind. Then he talks about the 3 must-have attributes in an entrepreneur he'll invest in on Shark Tank. And towards the end, he gets really jacked up talking about the 4 C's of a builder's mindset. So good. Ladies and gentlemen, please enjoy my conversation with Daniel Lubetzky. I saw that picture over your right shoulder.

I did a lot of studying leading up to this conversation, and that happens to be a picture of your dad.

Yeah.

And this just blew me away. I mean, they're in— your dad, his brother, and your grandfather. So your dad's dad, they're together. But they're in— is it pronounced Dachau?

Dachau.

Dachau. Okay. And they're on a death march to be pushed off of a cliff? I mean, I was floored. So what happened?

Yeah, so as the Allies, the Americans and their allies, were advancing to liberate both the concentration camps and the whole continent of Europe, away from the Nazis and their partners. Hitler's people— him and his people came up with something called the Final Solution because they didn't have enough bullets to kill all the Jewish inmates they had in all the concentration camps. They were going to walk them up the cliffs and then push them off so they would all die from the mountains. And my dad, at that time, he was 12 and a half years old when he was entered into the concentration camp. My grandfather lied and said that he was born in 1927 instead of 1930 so that they would let him work. So they thought he was 15, but he's 12 and a half when he got there, 15 and a half when this story happens. But he is 6 feet tall but weighs less than £70. Like, he's almost not alive. Like, he is, you know, one of those people so emaciated. And they start walking them. He has no shoes. Part of what my grandfather did is get him some makeshift stuff because a lot of people died on the way.

Forget about being thrown off the ravine. They died from exhaustion. And it's winter conditions. People are exhausted. They have no coats or anything. And as they get towards the top, a very big snowstorm takes over the place and the Nazis keep marching because they figured out these guys are gonna die in the storm. My father, my grandfather, my uncle hug and say goodbye to each other, and the snow covers them, but it forms some sort of igloo-type situation where they stay warm with each other's bodies. They pass out, but hours later in the morning, they wake up, cover out the snow, come out. Can you imagine all these barely human, subhuman figures coming out of the snow. And they look and the Nazis are gone because they kept advancing because the Allies were coming. So they were starving. They started walking towards a town to try to get some food. They start walking on the roads and they see these tanks approaching and they're like, oh shit, there's the Nazis again. But it wasn't the Nazis, it was the Allies. It was the US Allies. And what's really funny about the story, Ryan, is they were all Japanese Americans.

It was the 442nd Battalion, 556th Regiment. I hope I'm not messing that up. But Dr. Suito was a captain. And these guys have never seen a Japanese person, an Asian person, because they live in the little town in Eastern Europe. So they don't understand what they're witnessing. They don't understand what's going on. And before they They finally figure out these are American soldiers saving their lives. This is the most highly decorated battalion in history. And it liberated Dachau, it liberated a lot more. And my Uncle Larry ends up getting attached to them. He's by then 19. After recuperating a little bit, he goes as a translator and becomes a lifelong friend of the core people that Dr. Suitu and his friends were with. But 70 years later, I get a call from my friends like, oh, we're sitting with this guy, Dr. Suito, and he shows a postcard of this guy named Larry Lubetzky. Do you know Larry Lubetzky? I'm like, that was my uncle. He had just passed away. And so 70 years later, I got reunited with Dr. Suito, who went on from being a captain in the US Army to be a very, very highly respected doctor and scientist at Harvard.

And I got to thank him. And then unfortunately, I sent them some Kind Bars. But I was preparing to go visit him and his wife, and unfortunately he passed away as I was organizing the trip. So I only got to talk to him on the phone, but I gave a eulogy at his ceremony, and I got to meet his kids and grandkids who I'm still in touch with. And my son Roman, who was named after this Roman, came and thanked them also.

Oh my goodness. What does that story do for you when it comes to perspective in life, or when we're feeling sorry for ourselves or complaining about things. And then you think about that. They're hugging to stay warm and to say goodbye because they're about to die. And yet they persevere. And, oh, I just can't even imagine how that impacts you from a perspective. How does that make you feel?

Yeah, no, I mean, a thousand things. The power of people to change other people's lives. Because if it wasn't because of Dr. Suhito, and those valiant Japanese American soldiers whose families were being interned in California. Our government eventually apologized for it, but we didn't know if we could trust the Japanese Americans. We were interning all these families, and here are these valiant people and Black Americans, right? Like, the most highly decorated groups were Black Americans and Japanese Americans experiencing discrimination in their homes. And things have gotten so much better, but these were very, very heroic people. People and the power that all of us have to make a difference and to save people's lives and to make people's lives better. And every single day, we're not gonna pull off a Dr. Suito every day, but every single day when you're walking down the supermarket and you look at a person's eyes and you see their humanity and you give them love with your eyes and just give them kindness, all you need to do is you give them kindness. You have no idea what that person's been going through and whether you're just gonna give them a little of a nice sweet flavor or whether you're gonna change the course of their lives.

Last year, or maybe it was 2 years ago, I was at a conference on fighting terrorism and hate, and some of the people that were presenting were talking about how young people that are susceptible to being recruited for horrible crimes are going through difficult times and telling us stories about how that human connection changed the course of their lives and saved them. And the important work of fighting counterterrorism and anti-terrorism involves just our daily lives, just being kind people. Just that. If all of us do that, we're making a little bit of headway to prevent the haters from recruiting.

It seems like it impacted you in a big way in that you've designed your businesses to get people who I guess were supposed to fight each other And not like each other, but you're going to get them to work together and call again, a not only for profit, which I've never read before until reading about you. So this idea of bringing people from different backgrounds who normally would literally be fighting a war and killing each other, saying, no, we're not doing that. We're actually going to work together. And my businesses, they're going to be a reason to get you to come together. I'd love to hear more about that philosophy.

You're talking about peaceworks. Yeah. What's interesting is I'm in Austin here, and these are the shelves of success. And in my other office, I have the shelves of failure. And I think that's a mistake. I'm going to update these shelves to add the Peaceworks products because it's— there's no such thing as failure or success. These are false simplifications because I would never have achieved what I achieved with Kind if I hadn't achieved what I achieved with Peaceworks, which is a lot of lessons and a lot of mistakes from which I learned. When I was in college, I wrote my thesis on the influence of economics in resolving the Arab-Israeli conflict. And the thesis was that if you use business to get neighbors working across lines of difference, you would shatter stereotypes, cement relationships, give them a stake and an interest in making money together, and then hopefully help them discover each other's humanity. It became a very, very famous book. In medical circles, because if people were having difficulty with insomnia and couldn't fall asleep, you'd give them this thick 268-page thesis and they'd fall asleep right away because it was like the most theoretical, boring thing in the world.

But from there, I ended up getting a fellowship after law school to actually turn it into something. And then so I started Peace Sorts, where I actually got Israelis, Jordanians, Egyptians, Turks, Palestinians to trade with one another to make the most iconic brand name I ever came up with called Moshe Pupik and Ali Mishmoumkin's World Famous All-Natural Gourmet Foods. I still don't know why it didn't work out, but that taught me the lesson next time to keep it simple and name it KIND, just 4 letters and keep it simple. But Moshe and Ali brought together People that to this day, to their children's children, are friends and they have respect towards one another. And they— I just heard that the factory that we helped get started, they just shut it down after, I don't know, it's '93, like 30-plus years of them cooperating. And for business reasons, they shut down that factory. But like that venture, there were so many other ventures I ended up starting in Sri Lanka and Indonesia and in South Africa and Chiapas, Mexico, to try to make a little small contribution to help helping people work together. But the model was what you said, Ryan, using business to not just make money, but to in a sustainable way heal wounds, build relationships between neighbors in conflict regions striving to coexist.

And while Kind is what I'm better known for, Peaceworks is what helped me get to Kind. Yeah, because 10 years of mistakes, and I'm telling you, Ryan, the amount of stupid stuff I did while running Peaceworks, the amount of mistakes I made. But thank God that I learned the lessons from them, because otherwise I would have not been able to figure out Kind.

Were you going door to door making like $20 grand a year? I mean, was this right?

$24,000. Don't cut my— oh, sorry, don't cut me another—

So you're making $24,000 a year and knocking on doors selling stuff?

Stanford Law education.

After going to Stanford Law School?

After going to Stanford Law, I have offers from law firms to pay me at that time $86,000 plus they wine and dine you. And instead I paid myself $24,000 and barely could make ends meet. And my team also were making $24,000. That's what I could afford. And when I started as a one-man operation, and even for many, many, many years, I was still doing this. I would start on 122nd and Broadway, 'cause Broadway I determined was, the most robust street in terms of amount of supermarkets. So it was the most efficient street for me to go on. It's the way in New York City where the most supermarkets are. So I would start on 122nd and Broadway on the east side and start walking door by door, store by store, walking into the stores with my jars of sun-dried tomatoes, force-feeding people. Like, the poor buyers could not escape me. I was like— corner them and stay there as long as it took to break a piece of bread, force-feed them. And then they could not resist me. They would place an order for $36, then the next door, then the next door. And I was making— even in that, I don't know, it sounds like a story of resilience.

It's a story of utter stupidity because I was not focused. And I would spend 2 hours trying to convince Mr. Kim in the corner store of 84th and Broadway to try my product where I should have walked 2 more blocks and go to the real supermarket rather than the tiny bodega and build a proper— so I didn't know what I was doing. But one of the lessons from that is grit is not enough. You also need wit and fit. It's the 3 its: grit, wit, and fit. Too bad that it's coming from a Mexican-Jewish confused accent, but grit, fit, and wit. Grit is that hard work ethic, right? Like, you have to really push hard. You need to really Not give up because it is going to be hard. When you built Ryan, your business, I'm sure it was not automatically a success. You need to put in the work, but it's not enough to put in the work. You also need to put the mind to figure out what you're doing. And so to add the strategic element and the wit to be creative and outwit the competitors to be more creative than them.

And then fit. There has to be a fit between the product or service and what the consumers want.

Well, I bring up the door-to-door selling, even if it maybe wasn't the most wittiest way to go about it, but I think dealing with rejection, the willingness to keep going, perseverance, as you mentioned before, that kind of sets your foundation for the future of what you're going to do. I mean, your, your family history is a story of resilience and sticking together and The power of people, right? But you going out there and knocking on doors again, even if it wasn't the wisest way to go about it.

I love what you asked and I love the insight. I actually don't think enough about that. You're 100% correct, but it's a little bit more complex. Just to be clear for anybody that's listening and starting their business, it's not like I'm like, yes, I'm going to keep going no matter what. Very often, perhaps multiple times a day, I asked myself whether I was doing the right thing or was a total idiot. The amount of times that I cried on my own in my studio apartment, sat down and cried because I thought that I had made a mistake and that I was wasting my life away. The amount of times that I made mistakes and sometimes those rejections that you're talking about, for sure they made me who I am and stronger. And maybe I already had some of that inside me. And the fact that I was so passionate about what I was doing, Help me give that thing. But some of these people that reject you are absolute assholes, right? Some of them, most of them, I think 95%, maybe 99% were actually respectful, kind, and gave me a hand. But some of them were so demeaning, so disrespectful.

I still remember a couple of them were just so, like, they created holes inside me of insecurity and of pain, you know, because I was doing this work of love to bring people together, leaving away my law school career to try to build peace in the Middle East once. sundried tomato spread at a time. And I believed in my mission. I believed what I was doing, what I was making a difference. And some people were so demeaning and such jerks, and they take the wind out of you. And you need to just understand that's par for the process, that you need to be strong, love yourself inside, even in spite of the rejections. And please do not assume that I was invincible and that I was not susceptible to feelings. And by the way, it's even more complex. Because some of their advice of these jerks was good. Think about that. Like, there was one guy, I'm not gonna say names, he thinks he's my buddy still today when he's, oh, I remember you so fondly. He was an asshole to me, but his advice was good. He was not nice the way he delivered the feedback.

Once we were at a trade show and, uh, he'd stop me and said, stop, stop, you're just way too pushy. Give me space. Leave me alone. Get out of my life. You just need to give people space. And I was like, whoa, that was— can you imagine how that hits you when you're like a 25, 26-year-old dreamy-eyed person that's trying to make a difference? It broke me. I was, I was broken. But then I reflected and I was like, you know what? He's right. You cannot just be push, push, push. You need to, you need to let people in. You need to let people— give people the space and be smarter. 'Cause when you're doing sales, when you're doing anything, the ultra-passive person, you don't wanna be that. They're just watching the world happen. Don't lean in. You don't wanna be that. But if all you do is lean in and push, push, push, then you're just annoying. So you need to find the balance and the magic and the creativity to be sufficiently persistent and loved for it. And that is very hard. That is not easy to do.

You said the word magic. That comes from you as a kid in Mexico City. Is that right? You learned some magic. How did magic play a role in your life and your upbringing?

Well, I told you my dad didn't really have a childhood. When the war started, he was 9. When he was sent to concentration, he was 12 and a half. He was sent before that to a ghetto and to horrible conditions. So he only had a 3rd grade education, and he was full of wonder. What was fascinating about him, you know, we named the company Kind after him. Because he passed away the year that we were about to launch Kinda. We— what was special about him is that in spite of all of the suffering that he went through, he was kind to everybody, and he only saw kindness in people. He was a very special person, and he loved magic, and he always used to teach me little tricks. I used to ask him, Dad, teach me, teach me, teach me. And eventually he taught me a couple things here and there and a little more. And so that was a language he and I used. That was our shared hobby. And so we would go to magic conferences and watch magic shows, and then he would buy me a book and then another book about magic.

Ever since I was 8 years old, started doing magic shows and magic tricks. And till today, it's a big hobby of mine.

Is it one of the few things that you get really, really prepared for? Did I hear that right? What's this all about? Really?

You prepared, Ryan. That's impressive. I love when, you know, I, as you know, I'm about to launch Build or Break, so I'm entering your space. of conversations, and you have a really magical way. Build or Break is a show where I'm taking all of my lessons and the lessons of the most extraordinary builders out there, some of the most amazing people. I just did one with Matthew McConaughey. It was magical. I did Kevin O'Leary. Kevin O'Leary cried like you've never seen him cry before. Like, he opened up and shared some introspective lessons. And the show is called Build or Break because talking about Those difficult moments that could have broken you but built you instead of who you are. But what I've learned in my— I've done— you've done 700 interviews. I've done 30 so far. What I've learned is what you do, prepare but listen. And you do that beautifully the way you are. You have a lot of background, but you're listening to the guest and then connecting to where they are. So I really like your style. I have to learn more of your tricks. But I used to do magic shows for my entire team.

We had like a team of 500 or maybe 100 of them were at a trade show and we would have a dinner and I would prepare a mentalism routine and I didn't wanna screw it up. So I would really work at it. I've realized I prepare for anything that I'm not prepared for. I love winging it. It's just my personality, my style. I love winging it. I hate having to prepare, but I am disciplined enough that if there's something I don't know, I will put in the work. Today, tomorrow, and the day after. That's my personality. I want to deliver the best I can deliver. So for example, for Build or Break, it's been so much growth for me because it's hard. Because as you can tell, I love just talking. And you ask me, you're— the job of Ryan to you guys might seem, oh, whatever, this is Daniel's show. He's— but it is so hard to do what Ryan does. It seems simple. But after every one of my interviews, I need an hour to just decompress because I'm actively listening and actively listening takes a lot of energy. You're listening for cues.

Stephen Bartlett gave me this advice, which we talk about on the show about how do you listen, how do you interview? So every one of the Build or Break interviews, I go deep into the area of excellence of any particular person. We learn from their toolkit. So how do you become an active listener? How do you become creative? How do you become the best actor? How do you become the best entrepreneur? It's just if I had to recommend anything for my kids to hear, it would be the Rand Hawk Show and then the Build or Break podcast.

That's awesome. I think you could probably— you know how this feels. It's really cool to be able to do the thing that provides for your family, and it happens to be your favorite thing to do. So I was talking about the concentric circles of life, and when there is overlap, Yeah, man, it makes this really, really fun. So it's, it's 100%.

100%. I was talking to my son a few days ago and he started his own business. He said, Dad, what I love about this is this is my hobby. Like I enjoy every minute of it. And then Scott Galloway, are you familiar with Scott?

Yeah, I've had him on a few times.

So he has this thing where he talks about if you're pursuing your passion, that's probably some rich person's advice. But no, the whole point is— and Scott is a very dear friend of mine— but my point is, if you enjoy what you're doing, you're so much more likely to kick ass at it and to do well with it. Because— and also, you're already winning, like you, because you're doing something that every morning you get up and you're doing something that's satisfying. Find something that gives you energy, purpose, meaning that's your hobby. What— you know what the danger is with that?

What?

Then you overwork. Like, when I was building Peaceworks and Kind, you just do so much for it because you love it so much. You need to pace yourself.

Well, you're right. You get a few extra hours on a Sunday afternoon. Maybe your kids are taking a nap or whatever. You're like, I'm going to go to work, but it's not because I feel like I have to. It's because I legitimately want to do that more than anything else.

Other than being with your kids?

Well, yeah. So they're taking a nap or something. All of your kids? Ages 19, 18, 17, and 11.

So you have 4 like me.

5, actually. There's twins in there.

Well, I have twins too, but total 4.

Yeah, I know. It's awesome.

But there's a lot of craft in learning the art of listening and interviewing. It's very hard.

I'm glad you said that because I think the skill, which it is a skill, of being a good active listener is something we all can get better at. It takes repetition. You've got 30 of them formally now recording and more coming, and obviously the rest of your life too. But how has that impacted you as a communicator, as a leader, as a dad, actively building and intentionally building the skill of being an active listener?

Yeah, this is one of my greatest opportunities. I talk in Build or Break, and the common theme that I detect from all of these most extraordinary people, like on Build or Break, we're interviewing Incredible people have accomplished so much. The lead singer of Empire of the Sun, Luke Steele, José Andrés, the humanitarian, a ton of incredible entrepreneurs that built from nothing and fell and fell. Chris Paul from— oh my God, I'm going to get in trouble because I'm starting to share names that have not been publicly disclosed. Okay, now you really have an exclusive, right? But we have 30 incredible people so far and more coming. And the common theme that I notice about this is people putting the work And then have a positive attitude to make the best of it. And so for me, listening, I have to acknowledge that it's not my greatest strength, and then I have to lean in to try to get better at it. And that's the sign of people that have achieved a lot, is being introspective, understanding what's not working, and then putting in the work to make it a little bit better. And listening has helped me with my children.

I'm not perfect still. I have way more work to be done, but I I've become better at the dinner table with my team. My team might complain that I'm still not there.

What do you mean by getting better at the dinner table? Asking better questions, asking follow-up questions, listening, all of the above? What do you mean?

My personality is that of someone that always wants to be a protagonist. I want to be part of the what's going on. I got spoiled by founding Kind from a one-person operation where I was alone in the windowless basement of my building to an entity that had hundreds and hundreds of team members full of joy, like, hanging by my words for the most part. Not all of them, but plenty of them. And so I get spoiled by wanting that. And my kids, guess what? They want to talk about their football practice, and they're talking to each other, and I'm just observing. And I would like to be part of the conversation. And so all of a sudden, I'm learning the skill to listen and to gain more knowledge and to be a little bit more patient and to then know how to ask questions and be part of that without having to be that, without me being at the center of attention asking questions. My dad, going back to my dad, was the best interviewer because he was a coach. He always was there to listen. And when I was talking to him and I would ask him a question, he would come back with another question and he would just let me figure out the answers.

And that's the deepest way for you to really, really evolve is for you to ask yourself questions. So a great interviewer or a great coach or a great parent doesn't tell you what to do, which is the easier skill that comes easy for me. Helps you ask the questions you need to ask yourself for you to figure out what to do.

As you know, Daniel, I think parents can relate to this. Kids are the greatest in the world at making sure you always stay humble, no matter what you've accomplished. You create these incredible businesses and make billions of dollars. They don't care.

And it's as it should be. It's, it's, it's not just that they don't care. It is one of the most valuable aspects because it keeps you grounded and it keeps you human. And if you, you need someone around yourself, whether it's your kids or your spouse or your partner or your team members that can call you out when you're starting to think that— is it too crude to say that your shit doesn't smell? I don't normally use that expression, but Yeah, no, you're right.

You're right. We all need truth tellers in our lives. Kids are, I found to be some of the best because they'll love you and be there with you. But I think if they stopped making fun of you or they put you on a pedestal, that would be a really weird day. I would not feel good. Your kids are there to keep you humble. Okay. I want to go back to actually 2002. You're training for the New York City Marathon and you're like looking around for healthy, and great tasting snacks and you're struggling to find them. What did you decide to do about that?

Well, I tell that story and I tell a couple other stories as anchor moments in my recognition that there needed to be a healthy snack that was portable, wholesome, and convenient. Like, that was the genesis of my idea that what eventually led me to Kind, because Like when you're running a marathon and you're being served up all this artificial gobbledygook stuff or stuff that doesn't look like food, or in any occasion where you're in the airport or whatever. What a lot of people don't know is that in the '90s, late '90s, early 2000s, there was no healthy snack set that didn't exist in the stores and the airports and whatever. That did not exist. Your options were either stuff that looked like astronaut food and tasted like astronaut food, or stuff that was completely indulgent and devoid of healthy calories or nutritionally dense calories. And so I was on the lookout for creating a product that could fit my needs when I was skipping lunch or dinner, a healthy snack that was wholesome and convenient, that when you ate it, you could feel good about it. And that was what led us to launch Kind.

So there's so many different parts of the Kind story. One, I'm curious, you mentioned it about your dad, but Naming things is very important. We've already talked about this. How do you like— you know what, it's going to be called Kind. What's the story behind that?

Well, the funny part is that when Sasha Herr and I were— she was my head of marketing at the time, and we were riffing on what to call it. I need to find this page. I haven't found it, but we had like 80 ideas, and every one of the other ideas were stupid. And by the way, it's not a foregone conclusion that we would have focused on the word kind. And we had words like healthy and tasty, deliciously nutty, nuttyleicious, nuttylauko, nuttlaka, frutanutti, nuttalata, frutalanata, lapalatakata, all variations of the words fruit and nutty, joy and fruity, frutiluti, chukiluti. And it was too descriptive, it was too just on the nose. Oh, fruits and nuts. Well, you're going to look at the product, it's fruits and nuts. We didn't need to waste are very valuable thing. Just re-communing people that it's fruits and nuts. Plus Kind didn't need to stay just in the fruit and nut space. It was a healthy snack thing at that point. That's what we had stumbled upon, a fruit and nut bar, but Kind deserved to be more. And we were very blessed. Thanks also to Sasha and to a lot of my self-reflection about losing my dad.

And around that time, like we were looking for a word that could describe the 3 pillars of our brand, which turned out to be kind to your body. healthful, kind to your taste buds, delicious, and kind to the world. Socially responsible, trying to make a small contribution to make this world a little bit kinder, one snack and one act at a time.

Yeah.

That language came much later, but that's what it became. But when my dad passed away, like, it just became obvious that the adjective that best described him— anytime you met anybody still today, That was implemented. My dad, he was the kindest man, and he saw his mission in his life as bringing smiles to others. And all of a sudden— and this is the year 2003 where my dad died and we were thinking of packing up our bags again in terms of like not giving up, Ryan. Oh, it wasn't like it was all a straight line to success. The opposite. We had just lost a huge account with our prior business because the predecessor product we were selling We didn't control the manufacturing at the time, and they had added sorbitol and sulfur dioxide. And so we had lost all of our business for that product line, and we were barely making ends meet. We had like 6 or 7 team members, myself included. We sat around the table and we said, do we give this one last shot, or do we just pack our bags? And I'll give you guys 2, 3 months to go look for a job.

I'll go do the same. I'll look for a job, and then We'll call it a day. And we voted. And part of me wanted to just be throwing the towel and just give up because it'd been 10 years of a very, very tough journey. And maybe part of me wanted to go on. Maybe I, maybe I lied to myself that I seriously considered giving up, but we seriously took that vote. We literally took that vote and all of us said, all right, let's give this one last shot. And then All of a sudden, from the greatest darkness of losing my best friend, my mentor, my dad, and just being so sad to lose him and a business that barely can make ends meet, all of a sudden, Kind gets launched and it just takes over.

I love the idea of the story behind sampling. So your budget for sampling was like $800 and you viewed it as a cost. And you got some advice to say, wait a second, this stuff is so good. You just gotta get people to taste it. Let's dramatically increase the sampling budget so that people can taste it. And once they do, all of a sudden that feels like an inflection point. So the power of sampling, I'm curious about your thoughts on that.

Yeah, but with a caveat, it needs to be the right mousetrap because if you start sampling the wrong thing, it won't work. And I talk about a lot of these tools on Build or Break, both advice that I have for my journey, but also that some of these extraordinary people have. And we go practical. We talk a little bit of the strategic and spiritual and everything, but we, we provide very practical tools. And I talk a lot about sampling because it's misunderstood art form. And just to simplify, you first want to make sure that if somebody samples your product, they're going to enjoy it and recommend it to friends. Because if you're sampling something that only 1 out of 10 people like, You're gonna lose your shirt giving all these free samples. Only 10% they're gonna want to consider buying it again. You need to make sure that that number goes up to 5 out of 10, 6 out of 10, 7 out of 10. In Kind's case, 9 out of 10 people that tried a Kind bar, it was like, oh my God, I want to buy more. And I— and they were our, our ambassadors.

They were the ones saying so. It was a no-brainer. But I had been mistrained by myself because during the Peaceworks years, where, as you know, Ryan, I had no money, everything was a cost center. And so I had developed a scarcity mentality. And I talk about this a lot on Build or Break, about the different tools and how to build a business and think about this stuff. But a scarcity mentality is definitely better than a gluttonous mentality, right? Like an overspending mentality where you're just wasting money. A wasteful mentality, a wasteful money culture is just going to run you to the ground. You're going to run out of business. A scarcity mentality is going to help you preserve every dollar, but it's not going to fulfill your potential because everything is a cost center to you. You're missing opportunities. The right thing is in the middle, a resourceful culture and mindset where you're thinking like an owner and you're not wasting money. If you can do it for less, do it for less. But sometimes you want to invest in that growth. And so sampling was a good example of— I saw it as a cost center.

And I hadn't realized that it was an investment opportunity. And once we started sampling, we went from $800 in 2008 to $800,000 in 2009 to $20 million in free product within a few years. And that made all the difference in us scaling to a multibillion-dollar company.

You eventually decide to sell, and different, I know, not all at once. So you become this guy who was making $24,000 a year knocking on doors to a billionaire. I mean, that's a dramatic change. How did that change you?

So first of all, there's a difference between the liquidity event and the paper money, right? Like, so I, prior to selling Kind, already have achieved a lot of success and I already have a lot of those resources. In my case, it was true that I was much more conservative because in my nature, I also, I don't waste. Still today, to be clear, Ryan, I do not throw away food, perhaps because of what my father went through, perhaps because how they taught me, but I will not waste. So I find it very important to teach my kids not to waste. If you wanna be a good entrepreneur, I wrote an, an op-ed on the Washington Post. I encourage everybody to read it about Frugality and resourcefulness, because it's so dumb in this culture to think that, oh, you should be just spending, and that if you're saving money, you're a loser. I just don't understand why people think that. Like, you're not gonna be able to build a healthy home or a healthy business. But yes, I do think that once you have a liquidity event and when you have the money in the bank, you start taking care of yourself a little bit more.

And, you know, I didn't own an apartment or any housing till past 45 or something. Like, I didn't own any real estate till I was in my mid-40s or something. We didn't have a car. We had one and then we sold it. And we for a while didn't have a car. Then we had one modest car. And still today we don't— in our style, by the way, we live very well. We have an incredible home and vacation home, and we're ridiculously blessed and we cannot complain. We take very good care of ourselves. I'd like to say that I live within my means and that I always try to remember that you never know and never be wasteful. We certainly, in our decisions, I spend far more time and money on Camino Partners, which is our investment platform, our business, and on the Builders Movement and the Lubetzky Family Foundation, which is what tries to give back, than I do on just pampering myself. I haven't yet bought a plane. I talk about it, I think about it, but I've resisted it. I like flying commercial. Sometimes if the schedule's bad and the plane gets delayed, I'm like, oh, damn you, Daniel.

Why are you trying to be such a dummy? Just by the plane. But as a general thing, I like to do things to stay connected. And I actually think airports are the places where you see so much kindness. Of course, sometimes you see jerks. If you're on social media, sometimes you get down these rabbit holes of everybody hating each other and all this political stuff where they're hating each other. And you go to the airport, people are kind to each other and nice. And I like, I like connecting with people.

Well, one of the ways that you connect with people and that you help other people, and I've loved getting a chance to watch this, is Shark Tank. It's one of my family's favorite shows. And to see like your style versus Mr. Wonderful, who you just talked about, which you could tell like some of those people who are the most passionate and sometimes come off as like a character also can be very emotional, which I love seeing that range. When you are on Shark Tank and you are thinking about investing, In somebody. I use that phrase on purpose, investing in somebody. It feels to me like your style is more about the people and maybe less about the numbers and/or the idea, because you are a, like a people— and I'm not trying to put words in your mouth, but you feel like a people-centered guy who cares for others, is kind, and wants to support someone who looks like they have the attributes of like, let's go build this cool thing. Is that how you approach Shark Tank or, or what, what is your overall philosophy?

Well, it's evolving. It's evolving. But yes, directionally, yes. But I want to give an ode of joy to Mr. Wonderful for a second because I think he's an underappreciated genius. And I'll tell you why. First of all, he's like the, the glue that makes this thing work because he's comfortable being the jerk and the tough guy and saying what needs to be said sometimes when others are uncomfortable. It's the hardest job and he does it in a very witty way. And yes, by the way, I do think it's the essence of his personality to say what needs to be said. But obviously, he overdramatizes it for TV and plays it up a little bit. But I believe he's one of the most loyal people, and very bright, and a man of the world. And there is a role for the Kevin O'Learys of the world who are just gonna tell it like it is. Because if all you do is just be nice, then you're not being kind. You understand the difference between being nice and being kind? If you're nice, you're polite. And you're not saying uncomfortable things. But if you're kind, you're honest.

If you're nice, it doesn't cost you.

It's easy.

You can be weak and nice, but to be kind, you need to be strong. There's a huge difference between being nice and not causing problems and being kind and solving problems. Between being nice and not bothering people, not saying things, and being kind and giving honest feedback that's gonna help people grow. Between being nice And just standing on the side and being kind and stepping up against the bully and standing up to solve problems together. So kindness requires you being a protagonist. Now, I would not go so far as to say that Kevin is kind to all entrepreneurs, but he does an incredible service to say things that some of us, the rest of the Sharks, might be thinking. I'm like, oh my God, this person has a really, really tough story. They went through all this adversity, but their business makes no sense. How the hell do we help?

Yeah.

By the way, I'd like to think of myself— Laurie is just the most nurturing person, right? She's always trying to help heal that person. And Kevin is just gonna tell it like it is. What I'd like to think is I am trying to be nurturing while being kind with the feedback, meaning I try to, in the way I provide the feedback, be nurturing, but I wanna do it I wanna say what needs to be said, and I cannot— I don't always have the strength that Kevin has. He has no compunction, but it sometimes takes strength to tell people something they may not wanna hear. I've evolved a lot in season— I've been now 8 seasons. This one that's coming is the 8th one, and it's starting, I think, uh, September 29th. I think we're our first episode, an incredible roster of guests. Whoa, whoa. I mean, I think this season is going to be one of the best. The producers did an insanely good job with the guest choice. In season 19, it was one note, kindness. And as I've evolved, I've tried to be a little bit more leaning into also being comfortable saying jokes and being witty and understanding that people are here also to entertain.

I wanted to just always be providing advice, but I realized that you need to also engage people. And that's what The rest of the Sharks do so well, right? They're so funny. They're so witty. By the way, people don't realize, you don't know who's going to come in front of you. Like, the only thing that's different is that they record for 30 to 45 minutes and then they edit it into an 8 to 11 minute segment. But you get the essence. Like, You, Lininger, who's the editor and executive producer, does a very good job at extracting the essence of the thing. And it really It's very hard to do all of that, detect the patterns and be funny. And my fellow Sharks are pretty good at it.

What are some of the must-have attributes in a founder that they got to have this or these 3 things in order for you to say, yeah, I want to back them, I want to invest in them, I want to be partners with them?

Integrity. If I don't trust the person, I'm not going to waste my life no matter how much.

Can you sense that in that, in that 45-minute pitch?

Yeah, the best one at it is Barbara. Barbara is like Dr. Freud. And like, she, she has this, an essence of understanding human beings like nobody. She's got an incredible emotional intelligence. But yes, you can. You don't always get it right. You don't always get it perfect. But yeah, I think you can in between, by the way. And when you interview a person, Ryan, and when you meet people, it's not by saying, do you have integrity? Or like, show me an example of integrity. It's by asking other questions and then seeing how they're performing that you get to the essence. But you have to dribble and look for the nuance. That's what you really need to be intently observing. Integrity is really important to me, and I want people that I would enjoy, because in 99.9% of the cases, it's not going to be like this, that everything's growth. It's going to be up and down, up and down like a roller coaster. And so I wanna work with people that when I need to be in the trenches helping them, I enjoy that they're people worth helping. So I do wanna find people that are worth helping, that are good human beings, kind, respectful, and I want them to have a ton of passion.

I want 'em to really, really believe in their business and to sense that they're gonna outwork everybody else, cuz that's what it's gonna take.

Do you have a favorite that you've invested in?

A favorite product or company?

Or person?

Asking me to choose among my children.

I know people ask me this all the time about my podcast. It's really hard, but I try to come up with—

Well, not after today. You're going to have a favorite for sure, Ryan. Come on. We're here.

Let's go.

But the couple of HomeViewer, they're the salt of the earth. I love them. I don't know if you know this story. Invented this thing where this hummingbird dances next to you and drinks nectar from flower that is by your helmet or whatever. And the whole community in Colorado got together to help them. It's like a town of, I don't know, 40, 50 people. They're all assembling them, doing them. It's changed their lives. They retired as a teacher and an electrician and started these things. What's beautiful about Shark Tank, it helps people pursue their lifelong dreams and be entrepreneurs and build their own futures.

I love it. Daniel, I got one more question before we run, man. Oh, this has been so cool. Let's fast forward a year from today and you are surrounded by the people you love and you are celebrating like crazy. You're popping bottles, spraying all over each other. What are you celebrating?

Well, if you see this logo, It's the Builders Movement. And I worry that— I don't want to overdramatize things, but we are entering an era where a lot of the values that we take for granted are under threat. Respecting one another, being kind to one another, democracy, rule of law. And everybody that's listening agrees, but they think it's happening on the other side. They don't see it happening to their side or to themselves. And we need to recognizing that that both political parties and a big number of politicians, they use this to divide us. And they're no longer— the true north is not to solve problems, it's to get reelected. Most of them are not bad people. They're just responding to the incentives because on social media, if there's scandal, it travels farther. If you send that fundraising email with some screams, you're going to get more dollars. So we as people need to build a movement of builders that are committed to hold all special interests, all politicians, all political parties accountable to follow the will of the people. Think about it. Over history, as the United States was built, every industry group has a trade group, a lobby, a group representing them.

There's the Napkin Association and the Food Association and this association. Everybody has an association lobbying the politicians. And the only people that don't is the 80 to 90% of citizens that agree on almost all the issues. The most divisive issues that are used as wedges to try to get people to raise money and to get elected and to divide us— immigration, voting rights. 90% of Americans support voter ID. Why are the Democrats opposing it? But on the other side, Democrats support access. Why are the Republicans opposing it? There's things that are— are so basic on even on the most controversial issues like choice and life. 70 to 80% of Americans can agree on 78% of the issues to 80% of the issues. And yet on gun rights and gun safety, on all of these issues, we're paralyzed from making progress because it's us versus them. It's dehumanization, polarization. And you've seen how that can end. You've seen what can happen to people where there's so much dehumanization. And so build or break, It's not just about personal growth and professional growth for you to build the best business. Build or Break is also about building a community of builders that are gonna build their businesses, build their families, and build a better world by being curious, compassionate, creative, and courageous.

The 4 C's of a builder's mindset are the essence that helped me build Kindly to a multi-billion dollar company with almost no investment. And the essence of what's helped me build the One Voice Movement, the Builders and all that. And it's the essence of what it's going to take for us as Americans and human beings overall across the world to build a better chapter. So what it would look like is that Builders Movement made progress and helped start turning the ship to hold politicians accountable. And politicians are now paying attention, understanding who's the sheriff in town and doing what's right for the 87% of Americans that want to solve problems together rather than tear each other apart. Actually, that number is probably even higher.

Man, I want to be celebrating with you. I love that mission. I love that you think big. It's inspiring. It makes me want to follow. That's what great leaders do.

Go to Builders Movement. Go to Daniel Lubetzky to Build or Break. Please follow our social media channels. Please join on the web and give us your email or address. We don't ask for money. We ask for you to become a better— the best person you can be. And it's going to give you tools to grow your business better and to help build this world.

I will, man.

For $19.99, we'll also send you a Jinzu knife.

See, you learn to sell when you're in your early days and it never leaves you. But you do it in a way that I love. I love the juice you bring to it and the enthusiasm it makes. Again, it makes people truly You can't get behind a leader and follow a leader who isn't jacked up about the thing they're doing. And you can sense it and feel it. And I love that. So, hey man, this was great. I love it. And I would love to continue our dialogue as we both progress. Next time I'm in Austin, I would love to see you. It'd be really, really cool.

Thank you. It's a pleasure and I hope to stay in touch.

It is the end of the Podcast Club. Thank you for being a member of the end of the Podcast Club. Club. If you are, send me a note, ryan@learningleader.com. Let me know what you learned from this great conversation with Daniel Lubetzky. A few takeaways from my notes: a scarcity mindset versus an abundance mindset, viewing something as a cost instead of viewing it as an investment. This was Daniel's early mistake with Kind Bars. He only budgeted $800 a year in samples. Because he viewed it as a cost. Then he changed his mind and realized it was an investment. He upped it to $800,000 per year in samples and eventually $20 million a year. Scarcity versus abundance. View it as an investment instead of a cost. Where are you doing this in your life and in your business? And then Daniel's 4 C's. of a builder's mindset: curiosity, compassion, creativity, and courage. That's how you both build a company and a movement. And then the difference between being nice or being kind. Being nice avoids conflict to protect feelings in the moment, the short term. Being kind is about being willing to risk the moment, telling the hard truth because you actually care about the person.

We want to be kind more so than be nice. Once again, I wanna say thank you so much for continuing to spread the message and telling a friend or two, hey, you should listen to this episode of the Learning Leaders Show with Daniel Lubetzky. I think he'll help you become a more effective leader because you continue to do that. And you also go to Spotify, Apple Podcasts, you subscribe to the show, you rate it, hopefully 5 stars, and you write a thoughtful review. By doing all of that, you are giving me the opportunity to do what I love on a daily basis. And for that, I will forever be grateful. Thank you so, so much. Talk to you soon. Can't wait.