This interview was first published in CoFounder No 10 in late 2017.
Jan Ameri sat down with Gary Vaynerchuk after his speech at the Oslo Business Forum on 2 November. They discussed his upcoming new book, sneakers, getting back to wine, and leadership. He shares with CoFounder why he has lately shifted from investing into acquiring, what attracts him in a founder, his 51/49 thesis, and how he is becoming a platform of open source entrepreneurship.
Gary Vee was born 1975 in Belarus, then part of the Soviet Union. His family emigrated to the United States in 1978 and lived in a small studio apartment in Queens, New York. Later, the family moved to New Jersey and here Gary operated a lemonade-stand franchise and selling baseball cards during the weekends.
At 14, he started helping his dad with his wine shop, which he took over in 1999 after graduating from college. He renamed the store “Wine Library”, and started advertising online. In 2006, he launched Wine Library TV on YouTube and retired the show 2011 in after 1,000 episodes.
In 2009, Gary and his brother ‘AJ’ founded a full-service digital agency Vaynermedia, which today is an 800-person company with 150-million-dollar revenues. Clientele includes many Fortune 500 companies, and the firm is looking to expand in Europe, Asia and Latin America. Earlier in 2017 he took part in The Planet of the Apps, which was the first-ever TV show produced by Apple, where he was judging and mentoring app startups with celebrities like Gwyneth Paltrow, Jessica Alba and Will.i.am.
You already have four NY Times Bestseller books, and it all started in 2009 with Crush It! The new book, Crushing It! is coming up in January. Tell us about it, and share one thing about it that you have not told anyone else yet.
The good news is that I haven’t talked about it at all yet. This is the latest ever that I’ve promoted a book, because of the sneaker launch and because I’m busy with Vaynermedia. I usually have half of it sold by now. It’s an update. You know, I started feeling uncomfortable that so many people are reading Crush It! but I wrote it in 2008. I was getting a hundred emails a day, saying “I read Crush It! today and I loved it.” I felt that, theoretically, it was right, and there were certain things that were right, but I could make it so much more up to date. So I decided to rewrite it. What was fun about this time round was that I was with anybody is that there are two or three stories from people that I think are really well known in the marketing world – people who have some of the top podcasts and some of the top book writers – who get to share their stories of sleeping on couches before reading Crush It! I’m flattered and excited. I think people will get a real kick out of seeing some of the current marketing superstars and their origin stories of how Crush It! got them going.
Wine and sneakers. Which one do you want to talk about first?
Sneakers. [Gary was wearing a pair of 002s and pulled one off his foot to display it.]
I love them already! What size are those?
Thank you, brother. You want to steal them? Ten and a half.
OK, probably too big for me. Tell people about the sneakers. Where do they come from?
The president of K-Swiss cold-emailed me and said that he wanted to talk to me about something. I thought it was going to be like an influencer campaign: wear them and that would be it, which I had no interest in. It went further than that when I realised they were actually trying to make the first entrepreneur sneaker, like the way Michael Jordan did for sports, but obviously not to the Nike level as it’s a smaller brand. For me, as a 42 year-old, K-Swiss was a huge brand when I was a kid – the hip hop culture, the biggest gangster rappers like Ice T, used to wear them. So it was a real nostalgia thing. Anybody who follows me in marketing knows I’m obsessed with nostalgia and opportunity. So I thought it was an opportunity for me to test my thesis in a fun way. It’s been an incredible partnership. I got to design the sneakers within a framework, like “that’s white and that’s green”. It was the only option to get it out as quickly as we wanted to. The thing that was really exciting was that they gave me enormous amounts of freedom in marketing it, so I feel very in control of its success. I’m very excited for it to come out. I never thought my forty-second birthday would be me releasing a sneaker!
How many pairs are coming out?
I think about 10,000, and I think it’s going to be sold out by the end of the month when your magazine comes out in print. Maybe some lucky reader will still be able to get a pair.
Wine. You came back to wine very recently.
Yes. I think my dad’s business needed a boost to be very frank. That, and me missing wine. It’s 97 percent because I love my dad more than breathing. I wanted to give him a boost and it’s worked. I think we’re at 3,000 wine club subscriptions now, which is incredible. It’s been so much fun, because in essence I’m doing an episode of Wine Library TV once a month, which is, you know, it’s like riding a bike for me. Honestly, and this is not a joke, I did something very smart by accident. Right now, the trend in subscription is customisation. I went the other way. I said: blindly believe in me and I will have a great wine of the month every month. What that did was it gave me so much buying power, because I’m buying 3,000 bottles. That’s 250 cases of the same wine, which gives me unbelievable negotiation power. Plus, most wineries are sitting on too much wine but they don’t want to kill the brand. If you have a $60 bottle of wine, you don’t want Wine Library to sell it for $19.99. But in a wine club you’re disguised. You’re not hurting your brand. In fact, you’re accelerating your brand, because I’m getting into so many more people. I’m delivering a product that is so much greater than I even anticipated, because of the buying power and the brand protection. So I’m very, very bullish on the quality of the club.
Sports. What excites you in the sports business world today?
There’s only one thing that is super-interesting. eSports. It’s going to be enormous. It’s going to be a humongous space. It’s going to be one of the biggest sports. I mean, basketball, soccer (your football) and eSports will be the three biggest sports in the world, 12 to 14 years from now.
Let’s talk a bit about learning and leadership. Learning. As a business leader, you need to educate yourself constantly and track new stuff. What’s your advice on how to keep up with the latest things?
My advice doesn’t matter, because I think every person learns differently. For example, I can’t even read three sentences in a row and retain the information.
So how do you do it yourself then?
I do it through osmosis: living, engaging, knowing who people are, knowing what they care about, understanding them, context, content consumption, engagement, consuming comments. I’m in it. I learn through documentaries, so hopefully, they’re factual! But I think people should find out how they learn, and then triple down on that.
Leadership. What kind of a leader are you?
A great one! I think I lead by example, I take on the responsibility and don’t pass on the blame to anybody else. A leader who wants to have a real relationship with his team. I think that makes you a very good leader.
Who’s your favourite leader of these? 1. Richard Branson; 2. Jack Ma; 3. Jeff Bezos
Any female leaders you admire?
A ton! I think Beth Comstock (of GE) executed one of the greatest CMO leaderships that we’ve seen in corporate America’s history. I think she’s incredible. Then there is a young female entrepreneur, Rachel Tipograph, from a company called MikMak that I’m an investor with, so I know her very well. I think she is going to end up being an all time great, 30-40 years from now. I think the new CEO of Weight Watchers, Mindy Grossman, is a fucking gangster.
Investor and acquirer Gary. It looks like you have done fewer investments lately. But you acquired a company (PureWow) and created Vayner X. Tell us more about that?
Here’s why. Because I have become more Vayner X than VaynerRSE (the investment fund I’m operating). And as I grow the Vayner X world, like the PureWow acquisition, I’m looking at other small agencies to be put under the umbrella of Vaynermedia. Yes, I think that’s right. I’ve gone towards more M&A behaviour, because I think that startups are overpriced as a whole. I know how to steal or make a good deal in buying the whole company. I have no feel right now about how to make a good investment, because it’s too murky.
What is it that attracts you to a company for an investment?
And in the founder?
It’s what I would call empathy and flexibility. Somewhere in the courtship of the relationship I need to sense their ability to be religious about things that are abstract. Meaning that I’m religious about hard work. I’m religious about empathy. But I’m not religious about Vaynermedia selling social media. And also, too many founders fall in love with their thing…
You speak a lot about 51/49. Could you open it up for our readers?
I believe that in every transaction from every relationship – and definitely in business – if you are talented enough, that it is extremely strategically-smart to provide more value to the other person than you ask for in return. The end. And you know, if your product is a good deal, people buy it. I think of myself as a human like that too.
How should entrepreneurs act upon it?
Do it. Do it! But the problem is that nobody does, because a lot of people think entrepreneurship is selfish – what’s in it for me? They don’t understand that the strength comes in the reverse. I think of it as martial arts, where you’re using the force of the other person to your advantage. The reason I am so successful is that I’m using people’s desires for themselves as my advantage to build leverage.
Like now for this interview, we’re putting you on the cover of this magazine, printing it out and putting it out to 15,000 tech and business people. How would you rate that? Is it more value for the magazine, or for you, to have you on the cover? Is there some kind of different equation there?
Always. 100%. I think four years ago it would have been better for me to be on the cover. I think now it’s better for you, because it’s just a brand arbitrage. It’s why celebrities are on the cover of magazines, you know. But those eyeballs are there. I mean, I turn down all sorts of things now, even the covers of magazines, because it’s not worth the 75 minutes of my time in return for reach that is not that huge. Now if Fast Company wants to put me on the cover, I do it because it’s more reach. But then there are strategic things too. I want to grow in the Nordic region and this magazine has many Nordic entrepreneurs reading it. That’s also why I invested in ArcticStartup, to get more of a foothold in the Nordics via you guys. I think anybody who is successful needs to have the humility to take the risks and chances when they think they’re special. You know, every time I watch people who have nothing do everything, and when they get somewhere and they start saying no because they think they’re special, that’s the beginning of the end.
You say one of your main things is to help entrepreneurs to win, without hurting others. Could you elaborate on that a bit?
Yeah, build the biggest building in town without tearing down everybody else’s building. I think that that’s a very big thing for me. I’ve also started saying things like “winners win”, you’re not going to stop a winner. I’m just surprised by how much time and energy people spend on trying to make somebody they’re competing with lose by talking badly about them behind their back. You know, that’s how I’m winning. I have a lot of competitors who spend their entire dinner with a client talking about me. That’s when you win. I’m not worried about anybody else. I’m pumped that Chris Sacca made more money than me when we invested at the same time. He deserved it. He was more right. I don’t begrudge that. I applaud it. If anyone ever beats me, and as long as it’s fair, I think that’s the best, you know. It keeps me grounded, hungry, and I also genuinely am happy for somebody. There’s so much money and opportunity in the system. Nobody’s stopping you from getting yours. If you think some guy or some gal is winning and that’s coming out of your pocket, you suck.
Also you have said that you want to be a “platform”. What do you mean by that?
It’s funny you said that, as I actually thought about it today. Yeah! I mean, if I can create successful entrepreneurs and they create successful entrepreneurs… I think I’m putting so much good into the world that I become a platform. I think you can’t be a platform if you’re bad because you’re selfish, you’re closed by nature. But I feel like I’m open source entrepreneurship – I’m free and I’m putting out my best stuff daily for free. So in a weird way I think I’m more similar to open source. Like, I’m not keeping my best ideas to myself so I can keep the money. I’m trying to empower. I want people to win.
What do you think the future of work will be? How will corporations and startups change in the next 10 to 20 years?
I think you’ll always have tension between entrepreneurship and people working for somebody else. I think right now there’s an overcorrection to entrepreneurship. I think a lot of people are going to go out of business, because they have no idea what they’re doing. They’ll get jobs. Macroeconomics will melt. Look, I think corporations are going to have to deal with this and they will have to do a lot of work to get the best talent, because the internet has given talented people options.
Retaining the talent?
Or even getting it in the first place. The amount of 17-year-olds in the world today who, right this minute, when they read this, think that they’re going to be an influencer as a profession, is remarkably high. And most won’t. But the fact that they even think that, versus thinking they’re going to go be a lawyer or a doctor. They’re not thinking about going into the system. That is a problem. It’s not even about retaining. It’s about attracting. Attracting and retaining.
What’s your goal for 2018?
I just want to be better than I was the year before, as a person, as an executor, as an entrepreneur, as a dad. Just better.
What are your tips for 2018 for all the techheads reading this? What should they be doing?
Become a practitioner of Facebook advertising in 2018 or face the ramifications. Start becoming intrigued around Alexa Voice and Google Home. These skills briefings and technologies being built on top of the voice platforms. The opportunities that they bring.
As a last thing: you will be coming to Finland to the Arctic15 event in the end of May. What do you expect from that trip?
A lot of HUSTLE! I plan to do a Shark Tank-style live pitching on stage and I might make an investment right there. I’ll make some time to meet with my fans, do a book signing session, so I’m looking forward to it very much, my friend!
Thank you very much!
You’re welcome. My pleasure.