Steve told the story of going from a glass blower in st. Louis teaming of the founder of twitter to build a multibillion payment company. In the book you talk about a lot about perfect problems. When did you realize that Small Business payments were a you are going to have to do something new and you cannot copy. I hired jack when he was 15, he was a High School Student came into work at a company that i actually still have. I dont run any of my companies but it also dont sell them. This ones been around for 30 years. He goes off to college, we kept in touch. And then he had kicked out of twitter, the first time,. [laughter] they showed him the door and he came back to st. Louis and he came back we were hanging out and talking and decided to start a company together. We are then kicking around ideas he didnt have an idea and i didnt have an idea suisse are looking for problems we could solve. And came up with the problem. When did you come to that conclusion you talk in the book about your book as a glass of blower. Tell me about the moment she realized payments were a problem for small merchants. So it was funny jack adjusting kicked out of twitter paired my first reaction to that was jack was sort like a little brother to me felt like he was someone i needed to stand up for. What they did to him it twitter the first time was incredibly vile. My first suggestion was hey lets go to San Francisco and get even with those guys. I was motivated. But jack, to his credit said less to something more positive and just start a new so that was the impetus. And then we were looking for a problem for the only thing we determined was that our company was going to be focused on, i cant find my phone here want to use it as a prop. These things, were going to focus on these things because the iphone had just come out, we knew it was going to be important. To be hired an engineer from apple, he was starting in two weeks they gave us two weeks if for us to figure out were going to do. We could not think of anything. We were stretching for ideas, went back to my glass studio. Im a glass blower, i make stuff that nobody needs. I make art. That stuff that nobody needs. Matter fact in d. C. I used to teach the glassblowing at glenn local park. If youve been to the park 20 years ago, i was the guy that taught you how to make a paperweight. But the point is, i was in my studio and was trying to sell a piece of glass and i lost the sale because they couldnt take American Express card. I was angry, i had just lost this great sort of windfall. And i was talking to the lady with the phone order assignment one of these devices i have this attitude toward devices like this. This device is a magic device it turns into anything i want to prettify wanted to turn into a television, it becomes a television. A map, radio, it will turn into that book for it will literally tomorrow turn into that book if you want. It didnt turn into a credit card machine. And so, i was angry but i was also motivated to fix that. So i called jack on that device and i said lets make our iphones turn into credit card machines. And thats a restarted. The name of the book is the innovation stack. What is an innovation stack and how did you learn about that from square . Speak to an innovation stack is not something we knew about what we started square, it is probably the most powerful phenomena that i have seen in business simply a way as interweaving inventions together. Put enough of these together they start taking on their own life if you look throughout history at the Great Industries that have started, almost always there is an innovation stack at the beginning. I did not know any of this burden we started square i didnt say what to build in an ovation stack i didnt know any of this was happening. As a matter fact, i wrote this book and ive been having people reviewed like yourself, one of the greats compliments i got was from a very successful entrepreneur. Hes interviewing me in the skys living room he has a painting on the wall that is worth more than my house. I was like oh my gosh. So i am all intimidated and hes asking about the book and he finally said i wish i had known this one is 20 years old. Im like me too, theres this thing that happens this process you start to solve a perfect problem something that is not been solved before. Most of what we do is copying most the tools and training and comfort is with solutions that exist. When you get out of the world of copying, you can build something that is truly different, plus the process is different. And it creates this thing called an innovation stack. If you build it innovation stack at least in my studies. Guest in the book when you talk but innovation stack its interesting to me you focused on companies that we dont associate with tech. I think a lot of people draw that parallel with tach and innovation you focus on southwest, ikea, and others. Why did you decide to focus on those companies outside of the Tech Industry . Guest i am a scientist by trading my father was a scientist. I am very steeped in the scientific method. If you are going to do a reasonably controlled experiment, you need to eliminate variables. In one of the most powerful variables is the phenomenon of viral growth and technology. If you look at the potential for a company that does nothing really that interesting, but adds sufficient technology to an old business, you can get outside success. I did not want to study that. So what i did when i saw the pattern of the innovation stack, i said i want to Study Companies but i dont want to Study Companies like google. They are all whopping successful or amazon theyre all fantastically successful but what creates the success . The answer is in some cases is just the pure destructive nature of technology overwhelms anything else. So this is why i laugh when people study Google Business practice. They can find their own space program, which is tremendous. But their management could be crummy but it still such a powerful force of technology. So i wanted to exclude that. If you exclude it, which are left with is business throughout history that built those innovation stacks who have still dominated their industries prayed so i go back basically a hundred years ago and i look forward just showed that the pattern is something that is systemic and innovation, and not just a result of having Amazon Web Services and viral growth. Host some people see this book on the shelf they might be surprised to learn actually started as a graphic novel. [laughter] can you tell me a little bit about the evolution . Guest i did not want to write a business book. I dont particularly like, most books are really boring, they are these a ponderous selfserving they are not scientific and i saw this i thought i got to share this this thing. Then i did not want to write a business book. So i started looking at the stories of companies that have done this and these storks were epic. They were fantastic and i thought i dont have to tell us as a business story. This can be a graphic novel. So what i originally sold to penguin, was the sort of schizophrenic manuscript there was like graphic novel then taxed, then graphic novel been taxed and flipped back and forth randomly. Penguin liked it or at least they pretended they like to because they signed the contract. Once they sign the contract they owned the book, right . Then they took me to it this windowless Conference Room in manhattan and had a little talk in the chocolate like this. You realize your cute little comments are not going to show up on a 4inch screen. And people besides going to listen to this as an audiobook and as an audiobook its useless, you cannot take a graphic novel and introduce it to audiobook. You can lose 70 of your audience if you want to lose that stick with what you got otherwise rewrite it. They were right, so i re wrote the whole thing. But i still had all of these great comics so i made my own comic shes got her book ive got my comic this is for you cant buy this thing but i will give you a copy of this because look at the storybook banker. But there is a murder on that page and there is a funeral, oh heres the destruction of a major city, right . This is comic book staff. The reason i wanted to do a comic was because the tales of entrepreneurship in the tales of these companies that build into ovation stacks tend to be really good stories because theres a lot of failure. Failure makes good stories. Nobody was here about success because theyre boring. But failure . Howd you that scar, thats a good story. So i wanted to tell it in this format. Although theres only one chapter that survives as a comic if you buy the book ill give you the comic. Im not in a cell is. But you can have it. And they are good stories. And so often i find that we sort of ignore the fun part of what its like to do something that hasnt been done. Look, theres a lot of failure needs got to have a sense of humor. The mistakes, everybodys talking about that. Guest so on that point about the comic book i know only one chapters turned into a comic book now. But it seems to me if you wrote that comic book about square, the villain would certainly be amazon. So yes. [laughter] host tell me what it was like when you realize that amazon was trying to directly compete with you in the payment space. Guest yes, yes, yes, believe me i appreciate the irony of dissing amazon when youre in the middle of selling a book. [laughter] i will redeem myself at the very last Second Period so amazon did what they do which is they looked in our market, decided they wanted it and decided to take it. Down amazon takes a market they did two things that copier product, they undercut your price, almost by 30 , and they add whatever else they have like the amazon brand and a couple hundred million customers in all this stuff. Then they watch you die. So when square was fours old amazon did this. They ran the playbook. So we were terrified and we went looking for solutions that we could copy to respond. Looks room for all the companies that had beaten amazon theyd been attacked this way and there were none. Companies like netflix were arty giants but startups . Forget it, zero. Zero startups that i know of or that we could find have survived the attack by amazon. So is like you are truly alone. It was terrifying. We looked at what we could do, there wasnt even that much we could do. But amazon was undercutting us in price, there being amazon. And we were terrified. But there really wasnt much we chose to do differently be looked at all of her options, looking at those options we realized they were all being done for good reason. So we just kept doing it. We didnt even match them on price. So amazons price was 30 lower than our price was. We didnt match their price and we just kept going. And it lasted for about a year end a half, and at the end on halloween of 2015, amazon gave up and they mailed all of their former customers a little white square reader. I couldnt believe it. I couldnt believe it. This never happens. This does not happen. But it is what happened. And thats actually what led me to the book because as someone who has been raised as a scientist, i needed an explanation, i needed to answer the question, why did this happen . You cant just be lucky, there must be some phenomena and turns out square had an innovation stack but we didnt know it at the time there is no label and there were a bunch of reasons i had not seen it. Once i sought i said oh my god thats it thats what allowed us to survive amazon. Its what allows all these other companies i studied to survive these vicious attacks. Amazon is bad, what happened to Southwest Airlines was worse. We did not end up in federal and state court Herb Kelleher had it worse than i did. Speak one so you mentioned you looked around and could not find other companies that had been able to beat amazon. In the book you also say that you found some people who amazon beat, but they were willing to talk to on the record about it. Guest yes i found many amazon victims and talk to them personally. And got their stories, and then its ao thats great could i quote you, no, even people who were in totally different industries, people who werent industries that were now competing with amazon. Everybody was so afraid of amazon that nobody would go on the record. I have zero on the record, firsthand quotes in this book about what happened to them. Host wears people so afraid of amazon . Guest you have to ask them i dont know. Thats not for me to it share. But i will tell you it was so severe that i could get nobody to go on the record. So there are no quotes, just me. [laughter] thats it. She went right now are sitting in washington where theres a ton of scrutiny of the Larger Tech Companies on antitrust grounds at the moment. Looking at congress, the ftc. You think amazon is a monopoly . Guest not a monopoly in the traditional sense. But i think they definitely exhibited some of the behaviors of sort of market dominance. I am not an antitrust lawyer, i dont have a legally valid opinion on these things. But any company that gets big enough that it can move markets, ought to be looked at. And again im not a regular here, i guess i kind of him now, im a big believer in regulation. I think regulation is probably good in a lot of situations. But on the other side, these tech platforms and amazon in particular, are very good at keeping the customer in mind. So i think what you are looking for is a tech platform that gets very, very powerful, that still maintains a semblance of responsibility. I think amazon is done that and i think google is kind of done that. I think facebook has not done that. They deserve regulation different levels. See what i want to ask you about apple two because square could not exist without the iphone and later it relied on the ipad. So how do you think about them in that context . Guest apple is superpowerful and theyre really important to get along with. They also great innovation. I have tremendous respect for apple. We built our Company Based on a product that apple had sort of introduced to the world which was the mobile phone, this thing, thats an apple invention. I have a tremendous amount of respect for them and theyre also somebody you dont want to piss off. You dont want to do stuff we did in the early days, which could have upset apple a lot. We bought the dock connector which is the connected thing on the bottom and we put the square reader in through the microphone jack. That was a nono we were not supposed to do that. We thought weve get in trouble with apple will be did that without maybe or products is so cool they would be good with it. Because eve jobs of the time, who is in control of apple had a way of protecting products but is steve that your cool you are fine. Apple lawyers would leave you alone. So we approach steve to save our butts. Host so tell me a little bit about the design of square in that process of creating such an iconic design the people recognize thats in the missoni and museums today. Guest so the square car reader was about this wide and the one i built was even smaller and had a basic design flaw. It was one that i noticed, and i chose not to correct. It was when youre swiping a credit card there, it was so narrow that the card would wubble and wouldnt go through. As a result of that it would result in a misread period sub at 80 of the time it would work in about 20 of the time the card would wubble and it wouldnt work. This is a result of my testing. So to solve the problem i built another reader it was about that wide and tested it and everybody was one hunter with that. So the question was why do we built a tiny little device that didnt work as well as the big device . It wasnt for cost reasons or anything like that. But the reaction to the device was very different. If i use the big device, people were like oh hohum, and of the credit card reader. If i use the small device, the one that sound the smithsonian, they were amazed, they were blown away. What just happened . Whomever the first time he saw card go through a square reader you are impressed. Like everybody was impressed that got your attention. So we took this giant gamble at square to build a product that mechanically did not work all that well as it could, but just got your attention blew away. And it just looks so cool and fun to have. People were talking about it nice and i think we just have to go for the cool. So he built something supercool into this day, square readers, they would work but if their wider, but they are cool. The funny thing as it turns out that 80 number really dropped after a little bit of practice. So once you practice a little bit you always get a good read. So we discovered by making a product that was less than perfect, we trained customers to use our product. And once they were using it they were showing off to their friends about how good they were at swiping the square. Host that is a major gamble and it reminds me of one part of the book you talk about the distinction between entrepreneurs and business people. Could you talk a little bit about that . Guest i was trying to discover what allowed square to survive amazon. In the process i sell this thing called an innovation stack and i wanted to tell the world about it. Ive got to draw this or write this but ive got to tell the story. I immediately realized that the english language does not have a word for this sort of process i was describing. The process i was describing was building a business but not a business that hemond done before. So how do describe someone who goes out and starts a business thats an entrepreneur. But i have a friend of mine who start a Coffee Company hes an entrepreneur he opened a Coffee Company he has coffee shops. But coffee shops have been around for centuries. You know how to make a coffee shop or if you dont know how to make a coffee shop you can go to a trade show where they will teach you all the stuff you can hire this vendor to set up your your espresso machine, coffee is a solved problem. So how do you different somebody from that from somebody whos doing something thats ever been done before . Another friend of mine is trying to launch satellites for supercheap suites buying old russian fighter plane stripping the crab out of them loading them up with the missile and sends them up the 90000 feet, put cement on mach two power dive and pulls up at the last second says all this Kinetic Energy 70000 feet up any fires initial. If you fire a mission from 70000 feet up going mach two you dont need to have a very big missile there so much energy in the thing to begin with. He thanks he can launch satellites cheaper. Now wheres his tradeshow . Wheres the eom buying old russian fighter jets and setting up to the stratosphere. Theres nothing. Hes has a different set of rules. Hes living in a world where i needed to be able to describe that for a minute turns out, the word entrepreneur was originally used and popularized to describe the person who is doing something new, and weird and it might not work. It was the original use of the word. Now it has since to come to mean just business. You can say or in entrepreneur, he started a business, that the correct use today. But the ancient use, the hundredyearold use that economists were using 100 years ago, and then it meant something when they were different. So in the book i go back 100 years and say were going to use this word, but we are going to use it in the archaic definition is the only word we have that i can used to describe it. I wanted to be able to different what its light on trent to not copy. Because look, i didnt want to write the book, its a pain in the in a very slow riders for tougher me. I was like oh god of got a read another book. But i had to write this thing because i looked for the explanation phenomenon id seen. Nobody had ever explained it. Then i understood why, how do you explain it theres not even vocabulary to cleave off the part you want to talk about. So i needed to dust off the old definition of entrepreneur, and then go in find examples that supported my thesis. Host when did you realize you yourself fell into that category of entrepreneur versus businessperson . Guest them still sort of realizing it. By my definition entrepreneurs are people who solve problems that have not been solved. Sometimes fail to solve problems who have not been solved before. Im certainly in that latter category at the slot problems i worked on a still dont have illusions for. But ive also had the fortune of doing some stuff that hasnt been done and then having it work. And seeing the results. The results are tremendous. And so, its just a great thing when it works. When it finally works i should say because typically leased the path ive taken its failure, failure, failure, something kind of succeeded and that success creates two other proms and you have to solve both of those. You do that enough one of two things is gonna happen you going to die because your own out of energy or the resources or time, or youre going to succeed and when you succeed, you will basically be in possession of this thing called an innovation stack. You will have done so many Different Things, those who Different Things will interrelate and influence each other. What you have will look like nothing else in the market. It will behave like nothing else in the market and even when amazon tries to decide to copy what you just did, they wont be able to. Even amazon with all of their resources intact could not do it. This pattern is what creates Great Solutions to new problems. Sue mccue mentioned earlier youve known jack dorsey since he was a High School Student and working for your company. Tell me, when did you first realize that he had some of these qualities of an entrepreneur . Guest his first quality was demonstrated the first night because we made in poland all nighter with this parade the day he was hired we were in a panic lead made a giant air and we needed everybody. Thats how we got to him we were literally hoover ring up everybody from around the location or company was, and his mother ran the coffee shop that sold us the chocolate covered espresso beans we were using to keep everybody awake. This was before redlands was widely available. Sue had to stay awake by munching on caffeine. Marsha sold us the beans, she let us hire her son. He thanks she regretted it. We sent him home at 5 00 a. M. That morning. [laughter] on his first day of work. [laughter] so thats how i met jack. Quality one, tenacity, got it. Survives on little sleep, got it. They later discovered that jack is just incredibly competent. Hes quiet but he is really good. It just shows through. Stu went you mentioned earlier you have almost a brother like relationship with him, or so defensive of him the person was pushed out of twitter, what are your thoughts now theres this recent activist investor push once again to potentially push him out of the company. When your thoughts about that . Come on you guys have tried that before, if kicked him out twice let him run his company, you kicked him out once it brought back a second of the second time he brought them back he didnt kick them out the third time he came to a term, but come on guys pillows but jack is going to run twitter well. I dont know is about twitter, i dont have anything to do with the company. But, i would say this, jack is a fantastic leader. Hes a guy who thanks deeply this whining about the fact hes running to public companies, whats wrong . I think square has been phenomenally successful i see what he works there. He works as competently as is other company i assume, i would just leave them alone. Steven got it what you think there is about him that gives him the ability to run both of these Large Companies successfully . Guest he single, single and no kids are you married customers connect im not. Guest all the right folks out there will get it. You cannot have a family, and not have kids, but have to run another company . Wow im not saying families not a good tradeoff, im just thats why left square. I had my first child and i could not work 12 hour days anymore. Not in good conscience i would never know my kids but wasnt fair for me with all the other people working those hours for me to it stay around and put in oh eight hour day and go home and say see you guys. I could not do that. Thats when i left was after my son was born. He also has a tremendous work ethic. He is not dragging along a minivan full of sippy cups. See when you mentioned your departure from square, one in ten ask how your Company Change when the ipo. All the sudden i was taller than i ever was in my life. People start treating you differently. My life did not change all that much. Because i was living in st. Louis, i had already paid off most of my debts, so i was not in debt. Turns out going from a lot of debt to know debt is a big deal. Going from no debt to a lot of money isnt that big of a deal. At least not for me i dont spend that much. So that was weird. But people started treating her differently. I noticed, this is probably the biggest downside, i stopped getting good feedback. So i just spent three years writing a book, and i think its a good book because i cant tell because everybody says jimmy brooks great. Im like well maybe youre just saying that. I think if i was my old poor artist self when i was much grumpier and less known, i would probably be getting more feedback that the book might suck . [laughter] i dont know youve read it you dont have to be honest, just the cameras around. [laughter] host its really a fascinating account of your own experience and your research into so many other founders was fascinating as well. Guest i hope its not about me, the book is not about me. You do not want to write a book about jim mckelvey. The life of the story square is twofold. One is a supports the thesis into, ive got firsthand knowledge. I have complete firsthand you cannot get it anywhere else knowledge what it felt like, what i could say prebut the rest of the book, by the way was not going to write it unless i found examples of the phenomenon elsewhere because otherwise its me talking about me, that is boring. So, its not a book about twitters not a book about me, its a book on a phenomenon that allowed us to create square even though we didnt know what it was. And youd say you dont know what it is, why is it important to know . And the answer is it gets back to the core and the reason i wrote it. I know, i wrote this when i was writing i was typing the words i had a person in mind, i know who she is. Shes incredibly competent. She is so good, just so much potential. But shes one of these people who disqualifies herself from trying to do new things because she she has no qualifications to do the new thing. Thats heartbreaking because look, being qualified is the right answer if qualification is possible. But if its not, then you are in my world, then you arent entrepreneurial do stuff that will fill really different one fly home today my friend flew me appear, fight want to take control that little plane ive gotta go get certified of got a get an faa guide to 40 hours of training read passively test, i have to do all the stuff to make me a qualified pilot even then they can we find the snow clouds. So thats good, it will be bad for me to it get in the plains aol take over from here, screwed over. Today you can be a qualified pilot and you should be a qualified pilot but about the Wright Brothers . What about the first person ever flew or will wright gets in the plane having a citizen customer he doesnt know he does know if its possible, he doesnt know because there can be no qualifications to be a pilot because no one had ever been a pilot on the planes you got to pilots here, the pilot of 2020 better have a medical, better of all the stuff they need, the pilot of the first right flyer, could not be qualified. So back to my friend, she has been raised and trained as we all have, that we need to be qualified to do the things we do your qualify to check in the box. Right . Learn from people and note better for you know that thats good that so it should be accepting the case of redoing something that hasnt been done. We have so many problems in the world that have not been solved yet that if we have great people like my friend who i really wrote the book four, disqualifying themselves because they dont feel qualified, in a situation where they are never going to feel qualified no one is going to feel qualified to do something that hasnt been done. Ive done a bunch of stuff that has him and done and every time i hands sweat. I get nervous, and im never qualified, whose qualified start of Payment System im a glass blower i knew zip about that, jacked on professional hes a massage therapist. Right . The biggest bank in the world sky start is a produce vendors sold lettuce okay . Tighes Furniture Store in the world start with the guy whos 17 years old. Kicked out of his own country, but 17yearold not qualified to do, but it turns out, qualification is asked actively irrelevant i just wanted to reach out and give a taste of what its like and then stories that hopefully will entertain you. But at least make you feel when youre in the middle of doing something you are not qualified to do, that its okay and others who are not qualified to do the great things they did, or in similar situations. Host what didnt feel like when youre at the very beginning of starting square and realizing how much you needed to learn about the payments based in others one anecdote in the book where youre working on the product and you realize hey, think were breaking about 17 different laws right now. [laughter] how did you overcome that hurdle . I ignored it we ignored i started counting at 17. We discovered in the very first day that what we were doing was against all these rules and i turned to the guys and said hey guys but were doing is illegal. [laughter] turns out it was not just illegal in one way violated 17 different rules and regulations the weight mastercard and visa require you to handle card present transactions to all of our banking relationships. Tons of stuff. And 17 laws and rules and rags. Which we have since complied with, i say that in washington. We are now compliance and heavily audited. Got that one but it took us a year end a half to get compliance. So we built it anyway, we turned the machine on even though the machine is not license, there is note ul certification when i plugged the first square reader into an iphone. Theres also notes bark and explosion. Turns out it worked, system works, and because the system worked, we then had this thing we could point to to get the people who laws needed to change accommodate us, to change those laws. Change the rules in some cases retry to change our system to become compliant, there are a few cases we absolutely were in violation of something that had to be changed in order for square to exist. We go to them, show them this beautiful thing, that worked. Except it violated the rule and they said you need to change a rule, they did. Another founder in your book it starts out in a highly regulated space and has to break some rules at the beginning is the founder of Southwest Airlines of course. That some of the most fastening parts of the book your trip down to texas, to meet him, tell me a little bit about that. I know he passed away year ago id love to hear your thoughts on what his legacy has been in the business world. Guest i so miss herb, i probably got the last living interview with him. At least the last one i have ever heard. He welcomed me down to Southwest Airlines. At the time i had a theory at all this historical data, i had all the great data from history. The thing about data from history is a guy who dies in the 40 cannot argue with you. If im dead wrong he will not return from the grave to go on cspan and contradict, its just not going to happen. Thats a copout right . I had a theory and it wanted to take my theory hold it to someone who had been here and say okay herb you have lifted something i think was similar, what was it like . Herbert was incredibly generous herb had something that was nuts he was watching the world her magnifying glass through a smokefilled magnifying glass. He was so cool and so fun, he reminded me of how much fun it was and i try to capture that in the book. Well this whole graphic novel thing for herb out herbert got a make your superhero and i actually asked her for permission to do that. Herb said no. He said he felt it was not dignified enough. So is like a caveman got a cape so herb did not want to be portrayed like i did for others what a guy what a Great Company they built, if you know with the world of air travel look like before southwest, was an exclusive providence of the rich you can only fly if you are rich. And the government in their infinite wisdom concluded only rich people wanted to fly because they study people on the planes and so theres only rich people on the planes therefore only rich people want to be on the plane so what if you offer guy and affordable fare to go visit his grandmother you know . Herb change so many lives. Price saves so many lives people gone southwest to get cancer treatments at distant Cancer Centers for the got the right equipment they could fly back to be at their family. These things are lifechanging. You build an innovation, you do this you will materially improve the lives of millions of people. And herb was the living example of that purdum so sorry we lost them. So theres a great story in the book when youre getting out of his car, you picked up a cigarette pack off the ground and he signed it for you. So ive never asked for an autograph in my life i have friends slick i got one in the nba nba star never asked for an autograph, i was so starstruck by herb that i wanted his autograph but i filled up my notebook there is note left. Hes driving me to the airport in his car, its trash its full of empty cool cigarette boxes so i grab a cigarette box and handed to the man i said we autograph a pack of cool menthols for me. He was like sure, so i grabs a pen and he signs a thing it is my most prized possession sitting in my office and this little case that i built for it. Very special. Stomach thats wonderful, you mentioned innovation staff can change lives, when you think about that, what you think the legacy of square is and how is it change peoples lives . Guest oh my god squares allow people to go into business for themselves. Were right in the middle of coronavirus i dont know when this is going to air, wife is in a change in people who work for Big Companies may not be working for them after a while. In selfemployment as a viable option but is only viable if you get paid. Let me tell you if you sell same that cost more than a hundred bucks nobody carries a much cash and more. Checks are basically dead. If you dont take an electronic or plastic form of payment, you will not get the money. Square enables that basic school tool has started this process. We piled on by adding fantastic tools so that now i run my little class studio using a devon engine doesnt different square programs. I dont make this a square commercials not about that its all these tools it only Big Companies that are now i have it as a Small Company and it allows me to it compete. I can do the stuff to drink i dont have to worry about having the best hr system because square will help me handle that. See gift tools to the Little People they can compete with the Big Companies. And so that is what i find so gratifying when i see a Small Business person whos doing what she loves to do, and the business is working because shes got this thing that shes making or selling or doing. And we are making it easy for her part she can ignore the rest of it. Thats just lifechanging. C1 tell me a little bit about once you step back from square daytoday moved to st. Louis, he started a nonprofit, right . Guest yes. St. Louis had a problem we had a big deficit of programmers. We needed programs and jack and i have an office we close be good not hired of programmers in my hometown because with heartbreak and wanted square to to be partially located in my hometown. Well, after i moved back on the problem was sort of interesting. Turns out education does not work and Computer Program it works for every thing else. If we need welders, we can train welders in this need for supply of welders goes away if you need programmers and say will open a school for programmers for some reason that does not work. But the reason we know it doesnt work is the problem has been getting bigger, the shortage has been getting bigger for the last 20 years. While 30 years actually. Weve had plenty of training during that time. The problem with training, theres a bunch of problems one of the main problems is employers wont hire newly minted programmers because they can do too much damage if they dont know what theyve doing pretty dont have experience they dont have a job. If you dont have a job you dont get experience its a catch22. So we started launch code, and launch code is a Free Training Program that gives you the skills you need for free. The most important thing about launch code is that we started not as a training program, as a job placement program. If you have the skills launch code we get to the job no matter what your credentials were pretty figured out a way to do that we have it innovation stack we figured out somebody had never figured out before which is how to place people with competent coding skills and zero experience in a way that does not hurt that company soper not us in coming to a nicer kind or pay it forward and that crab, pure greed motivated hired launch coders because good for the Greedy Company is greed based. That job placement coupled with education. We had another innovation. Free innovation which is part of launch code innovation or Free Education which is part of innovation stack, is magical. Because it does two things it opens up the door to everything people you not expect on people he would look at or test and they would look or test the way you would expect. Theyre great. We can prove their great they get it Free Education get a job and its a kick program. C1 tell me a little bit, erase skepticism about business books. [laughter] some of them are great but ive read enough. Yet, no right . Steven with that skepticism in mind what is the biggest take away you help potential entrepreneurs take away from your book . Guest if you do something significant, you will not feel qualified to do so. And i can explain exactly why you feel that way. And show you a path out. And then show you this thing called in innovation stack which you can build. If you build that you transform your industry dont transform it you basically create a new industry thats different than the other industries. Youre almost beyond attack. Tesla was a great example of it in current day and doesnt examples in california right now, theyre probably hundreds of examples are on the. Its a powerful thing. If you see the thing and recognize it, you will be a little less scared. I say a little bit i dont people think the book is a guidebook theres no check list i thought a howto guide, okay . Its basically the concession of somebody who is been there, coupled with supporting historical evidence and all tied together around the idea that innovation, true innovation, stuff that has not been done before feels differently we dont discuss it. And, what is that like . Lets talk about that. And hopefully, if you read it and you find yourself in a situation where you can solve a perfect problem, you wont disqualify yourself. The guy is a multi millionaire super successful got a painting worth more than my house. He told me he shot one of his companies down these six steps into an innovation stack. He said if i wouldve read your book i might not of quit so early. I thought for a second i thought what would the world be like and he said i quit i just couldnt do it. But thats because i kept getting all the negative feedback, all the survey talk about in the book. And equip. This is a guy who is successful, hes a complete bad and if i could use as a my weight and youd all be impressed they did not give his permission to tell the story. Dont disqualify yourself or at least know when to disqualify yourself or at least kind of have a sense of what it looks like. Because it will feel different. Spew an obvious of the book just hit shelves have you shared this idea of the innovation stack and seen it play out successfully with any other body entrepreneurs customer two oh yes im not trying to hoard the idea if you piece together all of my interviews you dont have to buy when you can paste it together and sit easy way to disseminate knowledge. I sure this all the time. I work with entrepreneurs and talk to them and sometimes i actively discourage them but i think, the best advice i can give is that new solutions are really messy, ugly things and that we have been trained to want validation in advance. That is going to kill you and stop you every time connie forgot to get over that. And then i hope people care about something enough to actually stick their next out. List what i found the great entrepreneurs i have studied are not doing it for the money. Maybe a little bit, not the fame or with the benefits are, not that those are necessarily benefits, theyre doing it because they care deeply about solving a problem. They care enough about the problem will give you tremendous motivation see im giving away another chapter right here you dont have to buy the book. Give the comet, skip it, the point is you get that you get that motivation to solve a problem, he really care about. That motivation to care about the problem will drive you in a way that money within the external motivator cant spread a lot of times you will need that because its all you have. Especially when people even your family members, i come home, to this day and tell my wife some of the things im working on and she rolls her eyes at me that in get a work. [laughter] youve gotta have something to stand on. When you talk about theres so many copycats especially in Silicon Valley and theres copycats in the real disruptors and innovators what is a company you have seen recently it is a real disruptor and you are excited about . Guest let me step back and talk about cats, copycats. I have no judgment against copping i love copying i think copping is exactly the way to do anything. But, everything in this room, everything heres a copy. And some of it is actually fake, those are not real tvs. Its a copy and that is why stoop of built tv studios before they figured out that each airconditioneds place a much we dont sweat over talking. This tv studio where right now is a copy of others the desk, the chair, theyre copied because they all work, the chair is serving as a perfectly good chair. I love copying and ill always copy if its a realistic solution. But i dont believe it should stop at copying. I dont believe we should only copy. And i believe if you limit yourself only to the world of known solutions, you will deprive all of us of the new thing you could potentially invents a companies epic they get doing a great love tesla, i frankly love spacex. Ive only met a couple times but the guy who sits there and goes im going to land a rocket like that. My rockets can land straight up and down. Im not gonna take it in fish it out of the ocean ominous to the landing. The first five times seven times i dont how many times you saw the videos he sticks the landing. That tesla is not a traditional automobile. That tesla has a massive innovation stack. We think is just a battery and electric motor . Youre dead wrong for the reengineering of the chassis goes together how the suspension works, how the software, how you approach a car, there are hundreds of things that are different theres an innovation stack and a test so that gms good have a hard time copying. Site tremendous respect for these companies. Especially because they usually get so much abuse at the early stage. You want to see a company of the innovation stack you should almost look for ones are most mocking. See one of only got a couple minutes up we talked a little bit today about perfect problems and i went to ask, what is the next perfect problem youve identified . The one im working on is journalism. Specifically the problem that we as as individuals have loss or online identity. We no longer controlled or part of ourselves. Right now i exist as jim mckelvey on servers, tech companys big platforms but i dont know whats in the files i dont know its being used for good or against me, its just bad for me as an individual. Its also bad for means an individual as i have lost my economic voice. What i mean by this is i cant pay more for more good content and lesser crab. Heres the problem, most immediate these days is monetized using advertising. There are subscriptions that work for handful publications. Most publications, most videos are supported, the Washington Post financial times, near took, an economist, if its not one of five, actually there is an institution, tried to talk me into doing that back in 2016 of bike engine building up micro Payment System the reason he wanted to do and the reason i have been doing it, is because all of us, as consumers, want to be able to pay more for the good stuff less for the bad stuff or thats how he said the whats good bit about to go out and have lunch in d. C. Im going to spend my money at some restaurant. Probably going to eat the because amount of diet. Might buy a bunch of expensive vegetables and pay more for a plant burger that i would for a real hamburger thats a vote for a plant based diet gets tabulated by pay 20 books attorney box for this vegan burger we tabulate all those votes and thats what gives us quality and everything. But how does work online . The scary thing about online consumptions if i trick you to washington for ten seconds i make the same couple of pennies up those ten seconds orifice those that you love. Thats what you do is a journalist to fact check you have a whole Organization Behind you then you get paid and his gonna pay for that . Consumers like me who consume yourself. What i need to pay you more because you have a Big Organization has to create that quality. Its not a judgment of whos right and whos wrong, its simply a way of saying humans need to be able to express their preferences otherwise would be left with crab. So think of it in terms of food. If we pass along d. C. That every meal was ten bucks which you like it . What happened question marketed thats a great restaurant tonight, fancy steak no they just went out of business. Because they cant put a fancy steak in front of you for ten bucks. Now, you wont star because what will happen is the Business Model the replaces it will make the cheapest crab we possibly can and sell for ten bucks. Thats the world we live in and journalism. But i think is a crime is the fact that what we become, is this combination little bit of what we eat the rest as we put our heads for them all for what we, premature works. The model of what we put in our heads the materials that you create is a journalist, is now being economically incentivized by the system that rewards cheap. Thank god jeff is rich in amazons a Great Company because amazon made jeff rich and jeff employs you. And probably money on the deal, thank you jeff for employing cats. The point is we should not have to live in that world and thats what im working on right now. Thats fascinating unfortunates all the time we have today thanks much for joining us to talk about the new book and again its innovation stack. So thank you. Public Affairs programming on television, online or listen on our free radio app and be a part of the National Conversation through cspan daily Washington Journal Program or through our social media feeds. Cspan, created by private industry, americas Cable Television company come as a Public Service and brought to you today by your television provider. Coming up on booktv, former Federal Reserve chair ben beinecke is abthe author of the courage to act and firefighting, the financial crisis and its lessons. After that, conversation with former secretary of state Condoleezza Rice on the ongoing covid19 pandemic and national security. Good morning, good afternoon, Glenn Hutchins here, welcome everybody to this, i hope proved to be a fascinating and insightful session with ben bernanke and david wessel. When the financial crisis hit in 2008 and ben bernanke was chair, there was no playbook. He had to create one from scratch. A few of us expected his successors would need to refer to it so soon but fortunately fol