The Need for Entrepreneurial Leadership

a lot about leadership. He's the chairman of the Board of Overseers at the Hoover Institution at Stanford, professor at the Stanford Graduate School of Business, founder of Peterson Partners, as well as a former chairman of the board at jeff Blue Airways, and his latest book is Entrepreneurial Leadership, The Art of Launching new ventures, inspiring others and running stuff. He joins us on the phone from Park City, Utah, Joel, it is nice to have you back here on Bloomberg Radio.

How are you great? Nice to do with you again, Carol, Well, tell us a little bit, you know since we last talk. Um, I do think we are looking to the nation's leaders, the world leaders to kind of figure out our way through this world and figuring out how do you keep businesses going, how do you keep the economy going, how do you keep the financial markets secure? How do you see it? And how do you think the leaders are doing? Who's doing well too well? I think a lot of

leaders are doing really well. We have a portfolio about fifty companies and they're adapting to it. They're reconsidering, you know, what is their covenant with their customers, what are the hard things that they haven't done that they need to do, and what ways can they build their business in this time? There are opportunities that are coming to the four. People are learning new ways of doing business, and I think we're actually recovering quite nicely from the covid um prices.

And so what's what are the learnings that stick, Joel? Like, what are the things that you know, we've sort of learned in these remote working environments, in this zoom world and the distance world that you know, you feel like culturally or even in a day to day a setting are going to remain well. I think we were probably won't be taking trips across the country for a one

hour meeting anymore. I think we found but there are a lot of things we can do on Zoom or other of these kinds of programs that are actually quite effective. So I think I think the travel and hospitality and streets will come back, but they'll come back relatively slowly. Um. I think we're finding that we missed people. I taught, of course at Stanford in the spring, and uh, I used to come out of class on a high. I would I would rust me with my students. It was fun.

I would come out this time into a screen and come away think how much longer people? I have to do that again, you know? So, So I think we really understand that we need to be around people. Yeah. Absolutely, I think we are getting a little bit of a warped sense of kind of our lives that we are living it so much that things that we criticize our kids for doing being so much in front of a screen. We we have to to kind of keep things going. I want to go back to your portfolio fifty companies.

Talk to us a little bit about them, the types of companies, and you said that they're doing well. I am just curious about, as a result of what we are going through in the pandemic, are there some in your portfolio that you're are like, this is going to be a turning point for them. Uh, in terms of maybe demand going forward. Well, you may have heard of the company Franklin Covey. I've been on the board there

for about twenty nine years. It's a training company and they thought for a while that they were going to really have trouble because they do a lot of online or not online, but in person training, and they converted it over to all online and they're getting higher net promoter scores. They provided a bunch of free materials to schools that they work with and families. You know, people are teaching their kids at home now need materials, so they just for added it free to them. So they're

figuring out new ways to connect with customers. We've got another one that's the robotics packaging company, you know, and and with fulfillment what it is UH, you're finding that they're being used a lot. They actually build packages around the products so there's no air, there's no seal, there, there's no peanut. They really create these very efficient so it's called smart packaging for a green planet. And so they've they've done well, So it really depends each one

is different. Another one called Kota Paxi UH has basically given a lot of money to help people through this COVID thing through sales of their product. So interesting. Well, and I have to tell you, Jason, you know All Birds is in their portfolio. Jason and I are both fans Ums literally right now, And I have to say, you go to you know I remember, yeah, you go to their store in New York, and I mean it was constantly packed with people buying not just one pair,

but usually multiple multiple pairs. How do you decide what you're going to invest in? You know, I'm pretty old fashioned. I'm probably the opposite of Warren Buffett. He always talks about the business plan beats out the people. I invest in people I find great entrepreneurs that I back them and help them great businesses, so to me, I and that's why our portfolio had in all of these different kinds of things. That was the first investor in Bonobos.

You may have heard about business UM, and it's because there was a couple of students in mine that I loved, and you know, I just figured out how to how to help them get business. Still and what is the UM? And and do people you mentioned a couple of former students, like how do people find you? I mean I assume you're you were sought after anyways. Job, But but how do people get to you? Well, uh, so we're about a billion dollar series of fun, We're Insalt Lake, We're

on the internet. I know I have a big network because I've done business on the coast for a long time. So and then I always tell people I've done a lot of favors for people over the years, never expecting anything back, and every once in a while I get surprised. So that's the stores of deals. So, Joel, I want to talk about leadership in the midst of this world we are living in. We got to chat with you a little bit about that when we were talking earlier

in this year about your new book, Entrepreneurial Leadership. But this is a real test, I would imagine, and I know you talked to CEOs all across the world. If you can generalize what makes for a good leader in this topsy turvy world. Well, it's actually uh you know, I thought for a while, Liss no show of putting out a book on entrepreneurial leadership was the worst possible timing during this COVID thing. But I actually think that coming out of it, we need entrepreneurial leaders. These are

people who really innovate, They create durable change. They're not merely presiders. They're not merely administrators, managers, politicians, you know, the kinds of leaders that you sometimes get in organizations. I think it's gonna be our lead an organization out of this mess without having kind of an entrepreneurial mind. That that's a really good point. That's that. So tell us a little bit more unpacked that a little bit

for us, um Joel, if you would. In other words, what specifically do leaders at this point need to be thinking about. I mean, we talked Jason and I talked to a lot of CEOs who had to pivot quickly. Restaurants are having to do it right. They can't have everybody inside, so they've got to figure out how you know, you know upscale restaurants who are doing take out which they never thought they we do before. People are having to reimagine their businesses, and I think it starts with

thinking about who are our customers? What's our covenant with our customers? And that takes new creative thinking outside the box. You know, at jet Blue we decided there are number one value a long time ago is safety and uh if you think of safety now it has to do with help is what it didn't used to. But now we sanitize our planes, people wear masks, we don't serve, sell the middle seats. We make sure we have HEPA filters, we take people's temperatures, you know, all kinds of things

that are really consistent with our safety objectives. So I think every business is having to rethink these covenants. I mean, I would say that the first thing that you have to do as a leader in times like this is you have to survive. And job one is liquidity. So you've got to extend the runway. And I think a lot of leaders are challenged by that, but that's job one.

You've got to do that. And I think you have to reimagine what it is your covenant with your customers and make sure you're delivering on that and then you uh and go from there. And I think a lot of it is communication. Our cover story of the magazine this week is about Ben and Jerry's, which, as you know,

is part of UNI Leave, our giant company. But you know, after George Floyd in Minneapolis, I mean that company, you know, one of their board members said to the CEO you know, you've got to do something quickly, and they did, and that tends to be kind of their ethos of who they are. They're constantly thinking about bigger macro issues and how to have a voice out there um so that people really understand what they are and the culture of their company. So Joel, I have to say you open

the boarding doors. That were to talk about the airlines, and we'd be remiss. It would be journalistic malpractice. We didn't ask you what happens with the airline industry now? I mean it is back on its heels, to say the least. We've got all these dire forecasts, especially about

business travel. What's the road, the runway, whatever metaphor you want to use, what's the way back in the in the short and mid term here, Well, if it's gonna take some time for people to feel comfortable again, and it really starts out with the psyche of the customer, and I think they have to feel like it's still the safest way to get from point A to point buh So the airlines have been that for a long long time, and they've been actually a fuel efficient, carbon

efficient way of doing that. Two, But they don't feel like it's a good way from a health standpoint, So I think we have to secure that. It's funny after nine eleven, it took about nine months for people to really start flying the way they've been flying before. It took some practice. They had to get used to the t s a, they had get used to titanium doors on the cockpits, etcetera. So I think it will take some time because it's so hard to imagine how things

will come back. We've done scenarios where we looked at a V shape recovery, a U shaped recovery, an L shaped recovery, you know, which is to say a long long time. So I think you just have to imagine that you things are going to be different, and you have to be able to thrive, survive, then thrive in all of those scenarios. Do you think everybody thrives? I mean, Jeff Blue and American Right announcing kind of this big

partnership collaboration. I mean, people are speculating, is this the first step to emerge or you know, do we we just have about forty seconds? Do you anticipate that there will be some you know, more consolidation here. I think there'll be some shuffling. I think you may see some carriers disappear. You may see all kinds of different things. I don't want to speculate or green any news. Well that you could always do that with us, Joe okay

with it. Anytime you feel like if you come back, you come back and joyous, Joe Peter said, it's always a treat to catch up with you. We really appreciate Joe Peterson, of course, former chairman of Jet Blue, professor at Stanford's Graduate School of Business, founder of Peterson Partners. He's got his hands in a lot of pos love checking in with him head