Jeff Lerner
host: Jeff Lerner
parenting in New Zealand, music career, minimalism, entrepreneurship, giving back
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Transcript:
Jeff
Welcome, everyone to another episode of Unlock Your Potential. It’s Jeff Lerner, your host. So excited to be back with you yet again, having amazing conversations with amazing human beings. Today we are joined by Derek Sivers. So Derek, actually, you guys, those listeners to the show know that I don’t love lengthy bios. So Derek has done us a huge favor. And on his website he has a little blurb called “Me in 10 seconds.” So this is Derek in 10 seconds. He’s a musician. He’s a circus performer. He’s an entrepreneur, he’s a speaker. He’s a slow thinker. I think we’re all excited to learn more about what that means. He’s an explorer. He’s a xenophile, which means he loves travel and other cultures and other people, and he loves different points of views. He’s from California and now he lives in New Zealand and now he’s on our show. Derek, welcome to Unlock your Potential.
Derek Sivers
Thanks, Jeff. Thanks for having me.
Jeff
So glad you’re here. So glad you’re here. For starters, you’re in New Zealand. That’s where you live.
Derek Sivers
I moved here 12 years ago, mostly to raise my kid. I was living in Singapore at the time. So he was born in Singapore. And after he was a few months old, I thought, “Well, in a perfect world, where would he grow up?” I said, “Well, New Zealand.” I was like, all right, well, let’s see what it takes to move to New Zealand. I went and looked it up and it was about nine months of paperwork but made it happen. So here we are. But mostly just here to raise a baby.
Jeff
What were the criteria then for the perfect world’s place to raise a kid?
Derek Sivers
Oh my criteria. I wanted nature and safety. A place where my kid could really just connect with the natural world. You know, I know that his generation is growing up on screens, and I thought it would be not just a healthy advantage, but maybe even, like, a competitive advantage someday for him to have more of a connection to the real, physical world. Instead of just growing up on a screen. So I just wanted the place with the ultimate nature. And also it is kind of nice that if you live here for six years, they’ll make you a citizen. So now we all have New Zealand passports too.
Jeff
Okay. Very cool. And this was 2012.
Derek Sivers
Yeah.
Jeff
Okay. So I’m googling Lord of The Rings that came out in 2001. I feel like that’s what like introduced New Zealand to so many of us.
Derek Sivers
Yeah. I live right next to the place where a lot of that stuff was filmed. And I live right next to the studio where Peter Jackson did all the editing. And they still do like all the, you know, the Avatar movies with the blue people. That’s still all made at Weta and all that kind of stuff. So they keep innovating and doing good stuff. But yeah, I live next to some of those landmarks where things were filmed.
Jeff
Oh, it’s so beautiful. I mean, I’d always been interested in New Zealand, but after seeing those movies, it became a bucket list destination for sure.
Derek Sivers
Hey man. You’re in Utah, so it’s not that different. You got all the advantages there as well.
Jeff
I will say yes, that’s true.
Derek Sivers
They could have filmed the movie there.
Jeff
Yeah. I’m at home right now and I’m looking out this window here and it’s a different type of scape. There’s some more barren, like, red rock kind of vibes. It’s pretty nice. So you have and this is even in the context of this show where I interview a lot of extraordinarily interesting people. You have a fantastically interesting biography and history, which I also will say you’ve done us a great service. Like one of the things I love to do on this show is to go back through people’s timelines and on your website, on the about page, you literally have your whole life timeline. so I’m grateful. This makes my job so much easier. I want to start with, like, can we start with music? Um,
Derek Sivers
Yeah. I was going to ask you about yours too.
Derek Sivers
You were born in 1969 and by eight years old, you started playing piano, viola and clarinet. So talk to me a little bit about that. You know, your experience with it. And then we’ll we’ll pull that through to your career.
Derek Sivers
There’s nothing that interesting there. I think the only thing worth saying is that I’m glad that my mom just insisted you have to play something. She said it’s not an option. You have to play some instrument so you can choose what. And so at first, I guess I did piano because we just had a piano in the house and then in school, you know, they came through and offered like an orchestra instruments. So I did viola for a bit and clarinet for many years. But oh man, when I heard heavy metal guitar when I was an angry 13 year old and I heard Iron Man, I went, “Oh, that is the sound of my soul. That’s what I need.” And so I got really into heavy metal guitar from the age of 13 to 28 or something like that. So yeah, I took it all the way. I went to Berklee College of Music. Actually, you know what? For your audience, here’s one other interesting takeaway from this. There’s a beautiful saying that some jazz musician, I don’t remember which one, said, “If you can learn music, you can learn anything.” And my variation on that is that if you can learn how to practice and focus on something, it almost doesn’t matter what it is. It will benefit you in so many aspects of your life. So in those teenage years, in the early 20s, when all my friends were just lost and getting drunk and doing nothing, I was just absolutely head down and diligent and focused like, I want to be a successful musician. This is all I want in life. I don’t want to party. I don’t want to bum around Europe. I want to be a successful musician. But, you know, it could have been almost anything. It could have been wanting to be a weightlifter lifter or you know, archery master or anything, but just having something to direct our focus. Some reason to want to excel in life instead of just drift makes all the difference, you know? So for me, it was music for 15 years. But I think it could have been anything.
Jeff
I agree. I mean, it’s funny, as you’re saying, that I’m having this, like, intense recognition response of like I feel my body like, Yeah, yeah, yeah. Oh my gosh, somebody finally gets it.” Because I was exactly the same way in my 20s, obsessed with achieving virtuoso level abilities as a jazz pianist, was my particular genre to the willful exclusion of all the other things that most 20 something men seem to think matter, even relationships and like social networks and all. I had that myopic obsession, so I totally resonate with that. But I will say my my personal take on that from my vantage point in my life is I totally agree. Like what you learn about yourself by pushing yourself beyond the fringe of just like, “Oh, I’m good enough to play Fur Elise at a party or to play the, you know, the solo from any random Metallica song.” Or whatever. But like, I mean, really push yourself like jazz musicians do, or like highly technical musicians do, you learn as much or more about yourself than about whatever that thing is. So I don’t think it’s as simple to say that, “Oh, it could have been anything.” I think there’s a difference between things that are like intrinsically motivated and externally oriented in terms of like career success or material rewards. Yeah, there’s really not a lot in it for being a musician outside of the intrinsic joy. But there’s a lot in it. But it’s not the typical like, “Oh, I’m climbing the ladder and becoming a partner at a law firm.”
Derek Sivers
Right. Okay. Very good point. Yeah. Well, I say it could have been anything, but maybe I mean, anything that drives you for that. Like the path of mastery or the call to greatness. You know, that desire to be the best you can be at something, because then suddenly everything applies. You could read. I don’t know, a book about the inner game of tennis, and you can apply it to music. You can read a Tony Robbins book and apply it to your music. You can read a business biography of some billionaire and apply it to your music. If you’ve got something that you want to master, you know you can apply it to that.
Jeff
So I have often remarked about the parallels between music and entrepreneurship. Particularly any form of music that involves some level of improvisation where you’re having to master a set of like technical inputs and constraints and almost like mechanistic functions, but you’re having to assimilate it all into the ability to be creatively self-expressed and do something unique every time out of the gate. Right? Like that could equally apply, I think, to improvisational music or entrepreneurship in a sense. So I’m curious, as someone who’s a I mean, I don’t have to articulate the similarities here in the journey, but I mean, we’ll get into your entrepreneurship. But do you agree with that deep correlation there?
Derek Sivers
A little bit. You made me think about it, that, yeah, say the path to being a great classical musician has nothing to do with entrepreneurship.
Jeff
No. I was particularly keying off your love of heavy metal guitar, which would be whether it’s Randy Rhoads or Dave Mustaine.
Derek Sivers
Oh my god. No, sorry, but dude, nobody in all my years of doing interviews, nobody’s ever name dropped Randy Rhoads. That was my first favorite guitarist. That’s amazing.
Jeff
Yeah, I mean, I was an electric guitar player before I was a piano player. And he took, you know, probably as much as anyone took classical fundamentals and translated it over to improvisational, you know, pyrotechnics in headbanger settings. So, in that context on parallel.
Derek Sivers
Hold on. I just feel like nerding out on this for one second with you. Do you remember how Randy Rhoads had a Flying V with white polka dots?
Derek Sivers
I liked Randy Rhoads so much. I bought a black Flying V, and I went to the stationery store, and I got a bunch of polka dots, and looking very carefully at it, I aligned them exactly where I made a copy of the Randy Rhoads Flying V.
Jeff
Yes.
Jeff
Wow. Yeah. The Ozzy Randy Rhoads tribute album is, like, still one of my workout staples.
Derek Sivers
Wow. Anyway, okay, so back to the entrepreneurship angle that, I was thinking about it more as being the band leader. So, like, when I went off to Berklee College of Music. Everything was up to me. I was the ambitious one. Everybody else just kind of wanted to be a good bassist. They wanted to be a good drummer. I was like, “No, I want to put on great concerts. I want to have great shows. I want to write great songs. I want to make great recordings of the entire band.” So it was always up to me to make everything happen, to book the venue, to find musicians, to practice people, to get the recording hall. I mean, to get the rehearsal space. And years later, when I started CD Baby, I thought, “Oh, this is just more of the same stuff I’ve been doing for years with a band.” Like that’s where it felt like, yeah, I’ve done this before. It’s like, well, it’s being a band leader and being an entrepreneur. It’s the same thing.
Jeff
Yeah, I agree with that very much. And maybe there’s an entrepreneurial way to approach being a highly technical musician that goes beyond just instrumental mastery. And like you said, you don’t just want to spend all your time in the practice room. You actually want to go book a gig, and you got to put a band together and you got to have a promo packet and you got to do some more sort of entrepreneurial things. But I think a lot of it too, is around how do you enroll people? You know, one of my favorite sayings in In leadership is that, “Influence is the ability to get people to do what you want for their reasons.”
Derek Sivers
Ooh, nice. Yes.
Jeff
And in the musical context, to create that ensemble space where everybody feels like they’re being creative, they’re contributing to the final product, that their voice matters instrumentally. But also it fits within the structure of what the bandleader or the composer envisions. You know, you have to write out their parts and you got to sort of micromanage to some degree how they play their parts. But you know, if you come in with too heavy a hand, you kill the morale and it shows in the finished product, it comes out flat. So that enrollment and that almost like managerial aspects, I think is a lot of what you learn to in that context.
Derek Sivers
Nice. Totally agree. Yeah.
Jeff
Okay. So you did you went to Berklee. I show I see on your again, beautifully laid out bio that you toured Japan as a guitar player in 92. I’m trying to think 92. Did you ever play any of the the naval bases in Japan?
Derek Sivers
No, it was a concert tour for Ryuichi Sakamoto, who was at the time kind of like the Peter Gabriel of Japan. And so we just played like the Tokyo Budokan and these like 10 000 seat stadiums around the country. Which was so badass. I was 22 years old, standing on stage in front of 10,000 people, getting paid, going, “Man, this is the life.” So, that’s it.
Jeff
That’s cool. I asked because in my mid-twenties, which was also mid 90s maybe, or late 90s, I think I was about maybe 7 to 10 years later than you. I had a gig where I toured the naval bases in Japan. So anyway thought maybe we crossed paths, but and then you came back to the States, played gigs here, and I guess walk me through from being a working musician into starting CD Baby.
Derek Sivers
Sure. I mean, it’s dead simple. I was just selling my own CD on my website. So as you can tell, my website is personal. I’ve been online since 1994, when a lot of people hadn’t heard of the web yet. But my roommate was a multimedia major at NYU and told me about this new thing called the internet and showed me how to get on. And so right away, I created my own website, and I’ve just had one ever since. So at first it was for my music, and then it just kind of turned into a personal thing. But at some point I wanted to sell my music on my website. But in 1997, there was no way to do it. There was no PayPal. Amazon was just a bookstore, and the only way to do it was to go get a proper credit card merchant account, which was $1,000 in setup fees. They actually had to send an inspector out to my location. I had to incorporate. I had to set up a separate bank account. All this, you know, three months of red tape and after three months I had a “buy now” button on the website. And that was such a rare thing that all my musician friends in New York City went, “Oh, dude, could you sell my music through that thing.” And I went, “All right, it will. Yeah. As a favor, sure. Like on my band’s website. I’ll sell your CD, too.” And then word got around. And then soon, like, friends of friends and total strangers were calling. And then some people put it in their newsletter. And pretty soon I was just getting, you know, five people a day contacting me, asking me to sell their music. So I said, I think I better take this off my band’s website.
Jeff
So I’m always so interested when I hear stories like this. And this is such a common theme on this show, on this podcast. I mean, I talk to somebody who created you know, significant commercial success, basically because they took an action or a set of actions based on a desire when both the set of actions and the desire were common to very many people, or I should say, were available to very many people, the desire was common and the actions were available. But for some reason you did and a bunch of other people didn’t. Yeah, I’m curious why. Like, what do you make of that?
Derek Sivers
Okay, here’s my take on it. I think it’s because I deeply knew the needs of a niche. I think for most people, if you were to think of unsigned musicians, you know, independent musicians who don’t have a record deal, you’d think, “Ah, you know, they’re broke. What are they going to do, sell five copies? Not worth dealing with, you know, let’s wait till they get a record deal on EMI. Let’s wait till somebody else signs them to a big deal. Then we’ll work with them.” So because I was inside that niche, I wasn’t looking at it like a big money opportunity. I just saw there were people that need this thing. And honestly, the early spirit of the internet, like I’m talking mid 90s, it was not commercial. There was no money trading hands. It was just an academic free sharing of information between people on newsgroups and mailing lists. And all of it was free. And so there was this spirit of like, giving back to the web, right? So I was doing this not even to make money. I didn’t charge anything for the first few months. I was just doing this as a favor to my friends, as like my way of giving back to my community. And it was only after, you know, total strangers were dumping CDs on me. I thought maybe I should charge something for this. So I didn’t look at it as a business opportunity. I was just trying to help a small niche of people that everyone else felt they weren’t worth helping.
Jeff
Okay, so in the unique context of my world, you just said something so profound and I’ll explain what I mean. I run a platform called Entrer. I mean, we’ve had over a quarter million customers in six years, right? Of people coming in, buying some sort of course, or training. Looking usually for some sort of material shift in their life around how they make money. We have online business trainings and courses. How to start an online business. And we do a lot of personal development and it’s holistic too. It’s not just business, but the point I’m making is most people come into Entrer because to your point, they want to make money or they want to do something because of what it’s going to do for them. And so much of the work that we do with people is to try to shift that orientation, that entrepreneurship. The least important person in the entrepreneurial equation is the entrepreneur, because unless you’re planning to pay yourself, you’re the only person you’re not trying to raise capital from. You have to be obsessed with what’s best for everybody else, and about creating value and giving service and solving other people’s problems. And that mindset shift is really hard for a lot of people when they come into it going, “How do I get for me?” You started around creating value and providing a service to others and the financial piece, you know, to quote Victor Frankl, the success was not pursued. It ensued. And I think that’s a real a real important first principle for entrepreneurship.
Derek Sivers
Yeah, I totally agree. It’s coming in to think of what you can give, not what you can get. And then I call it naively, I just call it the Tao of Business, where if you just focus on making everybody happy. The money will work itself out. You can tweak a small thing to become more profitable, but you can’t tweak a small thing to be generous and make people happy. That’s a big thing. So I think focus all your energy on making other people happy. But there’s another thing we haven’t mentioned yet. So jump forward 13 years I sold CD Baby. I moved to Singapore just because I wanted to live somewhere new and exciting, and I got tossed into these circles of the Shark Tank style, let’s judge some entrepreneurs and decide who gets the award. I didn’t like it, but it was interesting. But the most interesting thing in my years of doing that was this most people would come in with some very generic idea for a very generic app, like, “Oh, I’m gonna make an app that shows me where my friends are eating.” And then somebody else would say, “I’m going to make a website to track your meals.” All of these are super generic ideas. And then one guy came in and said, “My pitch is I’m going to make software to manage the production process of small aircraft.” And we went, “Wait, aircraft? You mean planes?” He said, “Yes, small six seater planes. My software will manage the production process of small six seater planes.”
Derek Sivers
We want like, “What? What’s the market for this?” He said, “I know the market for this very well because my dad is in this business and there is no good software to manage the production of small aircraft. So they are already using my rough beta and his friends are excited about it. There are this many small aircraft manufacturers around the world.” And it took my breath away. I went, “Oh my God, this is a niche that nobody would know.” I mean, how many people would? A hundred people know this little niche? I thought that was kind of like my advantage with CD Baby. It’s like all these people out there in Silicon Valley looking to make millions. They’re not looking at like broke musicians in Cleveland thinking that this is a big opportunity in the same way that nobody’s thinking like, oh, small six seater airplanes and I’ll make the software for them. And then about a year later, I was at a conference in Boston called the Business of Software Conference. And similarly, I met a guy who’s making almost $1 million a year just doing the software to manage a granite countertop installations. And I said, “Wait, what? That’s all your software does is granite countertop installations?” He said, “Yep, it’s an underserved niche. There was no good software for people in the granite business doing granite countertop installations. So that’s our specialty. That’s all we do. And to make an almost a million a year.” I was like, “Whoa, I love niches. This is brilliant.”
Jeff
I do take your point. It’s the desire to serve, but also probably the discipline to impose enough constraints to create a definition and a distinction around the way in which you’re serve. The way in which you desire to serve. Yeah. It’s a really interesting calculus. I’m curious. I have sort of a working hypothesis that there’s an entrepreneur inside of everyone. It just needs, well, frankly, it needs to be spoken to and breathed life into and educated. You know, we educate the worker bees and everyone. That’s what our school system does. I think there’s an entrepreneur in everyone. I’m curious your take on that. Do you think that entrepreneurship is something that like psychographically, some people should or are suited for or and some people shouldn’t and and or are not suited for? Or do you do you agree with my hypothesis?
Derek Sivers
I’ve met a few people that just don’t want it, so it depends how far you take it. Like you could. I mean, it’s a human capability, anybody can. I don’t believe that thing like some people just can’t. Some people aren’t made for it, but some people don’t want that. I’m thinking of a couple friends of mine that they say, “No, I just want to show up at 9:00 and leave at 5:01. And I don’t want to risk, I just do it to pay my mortgage, and my real life is in my garden and I have no desire to push, push, push and, you know, do that. I just want the simple life.” And then I’m actually thinking of a brilliant lawyer I worked with for many years that as much as I admired his sharp, legal focused mind, he said, “Derek, I don’t have any ideas. I love working with you because you’re filled with ideas.” He said, “I don’t have ideas.” And I thought he was kidding. And he goes, “No, I’m serious. I’ve never had a single business idea.” He said, “I love working with entrepreneurs like you that have the ideas, and then I’ll do the dotting of i’s and crossing of t’s and making sure that it’s legally sound.” But he said, “I have never had a single idea. I can’t even imagine what it would be like to have an idea.” Whoa. That’s really interesting.
Jeff
All right, well, I like to ask that question of my guests. We’ll leave it there. I’m actually thinking humorously of one of the last episodes I recorded where I kind of, like, got into it with the guy, and I think we spent a half hour debating that question. So I’m not going to do that here. There’s too much other interesting stuff to talk about in your life. I would be remiss if I didn’t ask you about your career as a circus performer. Can you tell us something about that before we move forward.
Derek Sivers
Sure. It’s very related to the musician thing. I was 18 years old. I was living in Boston. I was going to Berklee College of Music and a booking agent called my bass player because he was more connected in the local scene. I think he was playing with like five different bands and had an agent, and she offered him a gig to play guitar at a pig show as a wandering minstrel for $50, and it was a $38 bus ride away. And he said, “Hell no, I’m not taking that stupid gig. Derek, do you want this gig?” I was like, “Hell yeah. My first paying gig.” I was 18 years old. And so, man, full of enthusiasm, I got my $38 round trip bus ticket to go up to Vermont to play guitar at this pig show, and where I just wandered around playing music for 2 or 3 hours while they were judging the quality of pigs. And I went back to Boston and I was like, “Wow, my first paying gig.” I was so happy. And then the booking agent called me a few days later with his booming voice.
Derek Sivers
He goes, “Yeah, hey, Derek, I heard you did a great job at the gig. Yeah, they said great things about you. So, look, I run this circus. Our musician just quit. I need another musician. And I heard good things about you. So, look, why don’t you join the circus? You know, we’ve got about four gigs a week. It’s ongoing. I can pay you this much per gig, and it’s good steady work.” I went, “Oh, my God. Yes.” So it’s like, because I took the stupid pig show gig. That’s how I got the job as the main musician of the circus. Which, turns out they didn’t tell me till after I got the gig that the previous musician was also like the Ringleader MC so suddenly, at the age of 18, I was the ringleader, MC and lead musician of this whole circus that toured around New England. And I did that for 11 years and quadrupled my pay per gig in that time, too, until it was basically like my circus.
Jeff
Wow. You know what a cool example of just being...What we talk about a lot in our world about being in a yes state of mind. Just saying yes to the opportunities that present. It doesn’t mean that you’re reckless and it doesn’t mean that you lack discernment. But you know how many people turn down something because I don’t know. They want to watch the game that weekend, or they’ve already got some sort of generic plan that’s the same as what they do every week or something, versus like saying yes to some thing like being a wandering minstrel at a pig judging contest because you never know what it’ll lead to. What comes to mind is a story where in college, buddy and I wrote a musical as part of a workshop course in the theater program, and we started submitting it all around all these festivals. And we got rejected by like hundreds of musical theater festivals, and we got accepted to one in Minneapolis, Minnesota. Kind of this random thing where we had to, like, put up our own money to and hire actors and basically create a production and drive everyone from Texas to Minneapolis. Huge exertion of effort to basically get to perform three weeks to mostly empty houses, mostly empty rooms. But one random night, one random guy walks in who turns out is the inventor of the breathe right strip. You know those things. Loves the show. Ends up becoming a lifelong friend of mine, you know, finds me backstage and ended up investing in other entrepreneurial ventures that I did over the years and became a mentor. And again, just because I said yes to something, that there were a million reasons to say no to and a lot of people probably did. It’s just, thank you for sharing your example of that principle.
Derek Sivers
By the way, I should interrupt here to say a lot of people know me for my book called “Hell Yeah or No”, which came from an article called “Hell Yeah or No”, and apparently gets quoted even on Shark Tank and stuff like that. I kind of coined this phrase and, I don’t know, 2009. And so a lot of people come to me saying, “Yeah, man, you’re the hell yeah or no guy. Say no to everything. I’m fresh out of college and I’m doing hell yeah or no, man, I get all these gigs coming my way. I’m just like, you know, I’m just not feeling hell yeah, about any of them”. And I say, “No, no, no, you’ve missed the whole point.” Like hell yeah or no is a specific tool for a specific situation when you’re already overwhelmed with opportunity. But at the beginning of your career, like you just said, the yes mentality. I think it’s a better strategy early in your career to just say yes to everything for the reason that you just named, you know, the one person that shows up to the otherwise empty gig. You know, the one stupid pig show for a $12 profit that turns into a whole career.
Jeff
Yeah, you earn the right to say no in a sense.
Derek Sivers
Well put, I like that.
Jeff
Yeah, I love that. Okay, so that touches on circus. Now looking at your bio, one thing jumps out that I deeply want to ask about 2007. It says rough year and now I’ll say it’s hyperlinked to an article about the rough year. So I could look it up myself. But I’d love to hear you talk about because our best things usually sourced from worse things. Tell me about 2007.
Derek Sivers
Actually, I’m curious. I haven’t clicked that link in a while. When you click it, what is the headline of the article that it goes to?
Jeff
This page is called loss.
Derek Sivers
That’s what I thought. All right. Yeah, I haven’t clicked that in a while. I kind of forgot about that. All right.
Jeff
And I’m reading the bullets. It was a rough year, so go ahead and tell us.
Derek Sivers
I haven’t thought about it in a while. But yeah. 2007, I got divorced and then I moved back to... My apartment in Portland, was on a renovation, and they told me it was going to be done by the first week of July. So we, like, got divorced like the first week of July. And I moved back to Portland to what was supposed to be a completed, renovated home. But oops, there were a few months behind schedule. So I spent a few months, like literally sleeping in the warehouse, like in between racks of CDs and sleeping on couches and then oh, God, it was awful. It was probably the single worst day of my life. July 10th, 2007, my employees all held a meeting in my absence where they basically wanted me to walk the plank. They’re like, “We got to get rid of this guy.” And people that I thought were my good friends were, were yelling, “Yeah, fuck him.” You know, there was like a recording of the meeting, and it was just like, the saddest day of my life. This thing that I had worked for for ten years to hear the people that I thought were my good friends, yelling about how to get rid of me. And I was like, “Oh, man.” It’s like, I just want to shut it all down.
Derek Sivers
So that night thought about my life and I thought, I’m just not enjoying this anymore. So I logged into the website and by the way, I was the 100% owner there. It was not like a collective. There were no investors. It was just me. It was just my thing. So I logged into the web server and I typed the command apache control halt, which just shuts down the web server. And I was typing what was going to be the new home page of Cdbaby.com, which is going to say. “Thanks, everybody. We’re shutting down. We will fulfill this week’s orders and return everybody’s CDs. And goodbye.” Because I was like, I’m not enjoying this anymore. I’m just going to shut it down. But I was typing this at, like, midnight, and I was like, trying to get the wording right, but I was getting tired. I was like, “Maybe I shouldn’t be doing this at midnight. Let me return the web server back on and try to do this tomorrow.” So I turned the server back on, and in the morning a friend of mine called and she said, “Hey, how’s it going?” I said, “Well, since you asked, I’m thinking of just shutting down my company.”
Derek Sivers
She said, “Shutting it down. Wait, why would you shut it down?” I said, “Because I’m sick of this shit. Like I’m sick of the drama. I’m sick of the people. Either I could fire everybody and move it across the country and hire a new team or just shut it down. I’m over it.” And she said, “Dude, if you’re going to shut it down, why don’t you sell it?” And I went, “Oh. Sell it. I forgot that there was an option.” So I was like, “Oh, wow. Thank you.” She goes, “Yeah, don’t leave money on the table.” It’s like, oh right. Money on the table. I forget to think in terms like that. So yeah, instead I decided to sell the company. So a year later, I sold the company for $22 million, and a bunch of people said, “Hey, congratulations, man, that’s so cool.” But I was like, “No, it’s not cool at all.” It’s like somebody congratulating you for giving your kid up for adoption. It was like, this is my baby. I thought I was going to raise this thing, and instead I failed so badly that I had to give it up for adoption. That’s nothing to celebrate. But then that really bummed people out, so I stopped saying that.
Jeff
And who wants to hear that? Save it for the podcast.
Derek Sivers
You’re rich now. We can’t feel sorry for you.
Jeff
Yeah, well, that’s exactly what it is. Nobody wants to hear your sob story after you exited for $22 million. But sometime when we’re not recording a podcast, if we have occasion, I’ll commiserate with you about what it’s like to. I guess the word mutiny comes to mind to have the theme that you gestated kind of take on a life of its own and try to reject you. Yeah, that’s tough. So you sold it and obviously at that point had a lot of options. Anyway, that was. So when did you sell it? 2008. It says.
Derek Sivers
Yeah. A year after the rough year, a year after that year of the divorce and sleeping on couches and the mutiny and all that stuff. And so a year later, people were saying, congratulations.
Jeff
What lesson would you take from and share with others from whatever experience led to that mutiny?
Derek Sivers
Two things. First, I think if somebody is a bad apple in your team, if somebody is like a constant problem or just not happy, if they’re just, like kind of full of complaints, nobody ever said, “I wish I had waited longer before letting that guy go.” It’s it’s just better to do it sooner. It’s like if somebody is full of complaints and anger, it’s not even anything personal against them. It’s clearly just not a good fit for them there are some people that I fired that I felt so bad about doing it at the time, but they came back to me like two years later and thanked me for getting them out of a rut. You know, like, this is clearly not a good fit. You’re not flourishing. You’re not thriving. If you’re full of complaints, you should do something else. But unfortunately, I was trying to be nice, and so I didn’t fire the rotten apples. And so that’s basically what happened in 2007, is that the few discontents went around the whole company and kind of slowly convinced everybody that this, in fact, was a horrible place to work. And in fact, Derek’s a horrible guy. And it was weird, like just earlier that year, we had won the award for best place to work in the state of Oregon. And you know, half a year later, the discontents had convinced everybody that it was the worst. And that’s what led to that mutiny. So, okay, so lesson number one, I wish I would have, well, and I highly recommend firing the bad fits as soon as possible. Number two.
Jeff
Maybe another way to say that is if people are unhappy, set them free.
Derek Sivers
Yeah, exactly. It’s a nice way to put it. But then number two is at least, this is what works for me to stop blaming others. So for two years after that happened, I was full of bile and anger. I was so full of resentment. I wanted to run CD Baby for many years, and I felt that my employees had ruined it, and I was mad at them. I was so angry for like two years. And then after two years, one day, I just suddenly had the interesting little thought experiment of like, I was like, “Wait, what if all of that was my fault? What if it wasn’t their fault at all? What if they were just playing their part in the play I had written.” And I created that whole scenario where, of course, how could they have responded any other way. I created the environment that made them act that way. It was all my fault. And hey, you know, everybody’s got their own motivations. But for me, that made me go, “Oh my God, that’s a much nicer way to look at it.” That makes me feel powerful. That’s something I can do something about. Whereas if you just feel that something’s somebody else’s fault, there’s nothing you can do about it. But just, you know, stew or revenge, right? But if you think that something is your fault, that’s the thing you can act upon in the future. You can try to learn lessons from and think of how you can be better in the future. So that was that was the other thing that made a huge difference for me two years later.
Jeff
I told you I’d save my equivalent story for another time, and I will. But I will just say that I really appreciate what you just said. My experience of that is just over two years old. So you talk about the two year time horizon. For me I released a book in August of 2022 that was meant to be a forward facing marketing piece for my company. And there was meant to be this kind of synergy of like, let’s publish the book. And it’ll be to the company’s interest to put some marketing muscle behind the book, because the book will be a customer acquisition mechanism for the company, and instead nobody in the company wanted anything to do with my book. And in fact, they kind of seemed like they didn’t want it. I came back from writing a book, which, as you know, you kind of disappear for a while to write the book. And I came back and not only they didn’t want anything to do with the book, they didn’t seem to want that much to do with me. So that’s the short version. That was over two years ago. So I really appreciate you saying after two years you’re just like, “Wait, what if this was all my creation?” You know, one of the one of the quotes that came to mind when you were you were talking is a Krishnamurti quote. He was a very quotable person. And he said, “To observe without judgment is the highest form of intelligence.”
Derek Sivers
Nice.
Jeff
I’m like, huh. I remember hearing that and going, “Okay, well, what if I just observe all the things that happened.” And don’t try to determine who did what and why it was so bad and, yeah.
Derek Sivers
You know, I’m not here to promote a book, but at this point, I’d actually be stupid to not mention that my first book called “Anything You Want”, is all about this stuff. It’s basically the lessons and mistakes I made starting, growing and selling company. So the reason it’s called “Anything You Want” is that Seth Godin named it because he was the publisher. So I never intended to write a book. But then Seth Godin said, “Hey, I’m starting a new publishing company, and I want you to be my first author.” So I said, “Okay.” So that book called “Anything You Want” was done for Seth Godin. But then my newest book called “Useful Not True”, is all about the last thing you said, the Krishnamurti thing. Whereas realizing that nothing of the mind is necessarily, objectively, observable, absolutely true. The only thing that’s absolutely true are these physical realities in the world. But the way that we look at something, the values and the morals that we have, like these are all just things in the head. So you can’t say that it’s necessarily absolutely true. It’s just one way of looking at it. And to me that’s the most liberating, empowering realization. Is that everything besides some physical realities are up for reframing. That you can choose to look at it in whatever way empowers you and helps you take the actions you need to take.
Jeff
So I’m reading a book right now that I’ll share with you and the audience as a book recommendation, because it’s a really powerful one. It’s called “The Case Against Reality”, Donald Hoffman is a neuroscientist. And there’s two concepts in there that he talks about that are, I think, very relevant to what you just described. And they’re both theorems as neuroscientists are ones to put forth theorems. One is called FPT, which is fitness before truth that essentially our senses have evolved. So sort of Darwinian evolution, our senses have evolved not to see what’s true, but to see what serves us best. In other words, evolutionary fitness right. And then, in fact, by design, by evolutionary design, there’s a huge range of things that we don’t perceive because they would actually be detrimental to our evolutionary fitness. You know, as a perfect example, the visual cortex is intensely focused on our ability to perceive the visible light spectrum. And it has, by design, omitted the ability to perceive ultraviolet light or infrared light or x-ray or whatnot, because that would take resources from something else that’s more essential to fitness. So anyway, FBT and then also ITP, the interface theory of perception, I feel like you might really geek out on this. So I’ll just leave it at interface theory of perception. That everything we perceive is not any objectively provable physical reality, but it’s our mind constructing an interface through which we’re able to perceive essentially, that everything is just information. But just as we have a graphic icon on our desktop that represents a file, but it doesn’t actually tell us anything about the intrinsic truth of the file, it just gives us the ability to manipulate it. That’s actually what perception is. Anyways, and I tell you, you read this kind of stuff and I think people hear this stuff and they’re like, “Oh, that sounds kind of woo woo. You know, what’s the utility in that?” But I agree with you. It’s so liberating.
Derek Sivers
Oh, I can tell you the utility. By the way, I love that you mentioned that book. I actually bought it a few months ago. I haven’t read it yet. It’s like queued up on my Kindle, you know, it’s a good one. Now you’ve given me another nudge to put it up the list a bit. So, I spent the last two years writing this book called “Useful Not True”. So I’ve thought about the utility of this a lot. I know so many people that are so held back in life because of the crap that their parents told them. You know that, “You’re not a good kid unless you are stay near your mother and take care of her. You’re a bad person unless you’re a doctor or a lawyer. You need to always put your family first before this. You need to stay close to home or you’re no good unless you’re making big money. I don’t care if you’re following your dreams. That’s stupid. You need to make money.” Or whatever, everybody’s got their own variations on this, but we grow up taking all of these things as truths. We think that they are just absolutely true. Our parents told it to us at the same time as they told us that rainbows are refracted light. And, you know, gravity makes objects fall to the ground and you’re a bad person if you don’t give up your dreams to take care of your parents.
Derek Sivers
It feels like an absolute truth. And so it’s amazing and liberating and empowering to realize that none of these things are necessarily true. Like yes, okay gravity that’s true. Rainbows, refracted light. Okay that’s true as far as we know so far. You know, maybe the’re will be a shocking discovery in the future, but as far as we know today, that’s true. But, you know, “You’re a bad person if you don’t follow your parents wishes.” It’s just not true. You can understand their motivations. Like you said about the survival fitness thing, it’s like you can understand why your parents have this belief because it serves them, but it’s actually more of a wish on their behalf. It’s not true. And so if you are liberated to realize that you can rethink these things, even people saying things like, “You can’t be a successful entrepreneur unless you have a co-founder, or you’ll never make it big unless you get investors. Or you need to be in Silicon Valley.” These go on and on and on and on and on. Every person probably comes to your podcast too and says, “Well, Jeff, you know, here, let me tell you, you know, if you want to make it in this business, you got to do the following three things.” But none of that is true. It’s just one perspective. And it is so liberating to see the world through that eyes and just realize it’s just one perspective. It’s not the only way.
Jeff
Well, I appreciate you teeing me up to say, and this is why my wife and I host a workshop where, among other things that we do, we dig into core beliefs. We dig into family rules, because what we find is that you can’t unlock people... Like the point of our workshop is ultimately I mean, this is an oversimplification, but essentially we want to help people find a purpose, find their unique purpose that they can live out as a basis for a professional life, not just like a money draining hobby on the side, which is how a lot of people think of purpose. It’s like, “Oh, that’s the stuff I do with my extra time that doesn’t make money.” And it’s like, no, you can create an abundant purpose that actually feeds and fuels your life, but you can’t as long as you’re constrained within these core beliefs that are built on what we call family rules, then unless you sort of objectively probe and pressure them and challenge them and figure out what you believe, not just what somebody else downloaded to you before you knew it was happening, you can’t really find your purpose because you haven’t even found yourself.
Jeff
So anyways, thank you for giving me a little room to plug that. I just have to ask procedural note we’re technically at our time limit, but I’m good. Are you? Do you have, like, a hard stop or 5 or 10 more minutes keep talking? Okay. Because one thing I deeply want to ask you about and you sort of scratched at it earlier when you said, “Oh, yeah, I forgot I could sell my company.” You know, a lot of entrepreneurs or or just anybody listening would be like, bro, come on. You’re really trying to convince us that you had this multi-million dollar business and it escaped you that you could, you know, capture all that value, and you said you were just going to shut it down. But what I happen to know about you is that I think you’re self-professed minimalist. Tell me if I’m wrong about that. But, like, you really sort of actively askew that external material orientation. And I might be misrepresenting this, but, like, tell me about this kind of minimalism thing that you’re associated with.
Derek Sivers
I was not always the minimalist, but I felt the pain of having too much stuff. I moved house every year or two for many years, and every time I did, I had to pack up all this crap and pack it into a moving van, move, and then unpack all this crap. And the last time I packed up all that crap was when I moved from New York City to Portland, Oregon, where I was moving CD Baby to a bigger warehouse. And the company was just booming at the time, and I was so busy that I put all my crap into storage, and I stayed at a temporary furnished apartment because I was just so busy with work. I just thought, all right, here’s a pre-furnished apartment. It was actually my grandma’s guest cottage. I stayed in my grandma’s guest cottage and kept all my stuff in storage. Until I could just, you know, have the time to go find myself a real house. Well, you know, six years later, I was still living in that guest cottage, and all my stuff was still in storage. And I thought, “You know what? I haven’t used it for six years. I’m just going to give it all away.” So I told my 85 employees, like, all right, “Everybody go help yourself to my storage.” Because it was mostly like my musical equipment.
Derek Sivers
It was like my guitars and bass and speakers and amplifiers and mixing decks and, you know, reel to reel tapes and reverbs and all that stuff. So I just let everybody have it. And I was left with just, you know, one suitcase of belongings. And I was like, “Yeah, I’m good.” And so I think it’s not from some kind of dogmatic, I should be this way feeling. It’s more just noticing, in fact, that I’m just happier when I’m not having to look after a lot of crap. So that’s about minimalism itself. But I think the more universal lesson for anybody listening is to just know yourself well enough to know what you actually want. No matter what people say, you should want, right? Because they’re going to be people telling you that you should be a billionaire. In fact, you’re not living to your full potential unless you’re a billionaire. And there will be people saying you should have a big team of people or you should be leaving a legacy, or you should be famous or you should be, I don’t know. The list goes on. But you have to know what part of this excites you the most, because maybe you do want to be famous, and maybe fame just actually excites you more than the money itself.
Derek Sivers
And you have to just know this about yourself and feel okay about it, because it may be the opposite. You might decide that you know what? Money is all that matters. I don’t want the fame. I’ll let somebody else take the spotlight. I just want to be the person behind the scenes making more money, right? So I lived in Los Angeles for many years, and the richest, nicest houses in Los Angeles are not the famous movie stars. It’s the producer that you’ve never heard of because the movie star is famous because it’s the person who chooses the spotlight over the profit, whereas the producer is richer because he lets somebody else take the spotlight. He’s happy to just take the profit. And maybe you really do want to leave a legacy and put your name all over things. But no matter what you choose, somebody will always tell you that you’re wrong, that you should not be valuing that. That you should be valuing something else. And you just have to confidently know yourself well enough to know this is what works for me. This makes me happy. And for me, there’s just a certain way I like to live, which is quite lightweight and burden free.
Derek Sivers
And this is just how I like to be. So I learned the hard way. I don’t want employees. I don’t want investors. I don’t want to be beholden to anybody else. The less responsibilities, the better. The less stuff, the better. I like to move house every year or two. I still do after all these years. I just like moving. This is what makes me happy. And so, yeah, when I sold my company... I thought this is what you were going to get at. Some people think this is very weird about me, but if you know me, it just makes congruent sense. Is that when I had this deal to sell my company for $22 million, my lawyer said, “Well, congrats, man. What are you gonna do with the $22 million?” I said, “You know, I’ve thought about it a lot and I’m just going to give it away.” And he goes, “What, are you serious?” I said, “Yeah.” He said, “How serious?” I said, “Very.” He said, “Like irrevocably, you will never change your mind in your whole life. Serious?” I said, “Yeah, I’m very congruent about this.” And he said, “Well, in that case, I actually used to be in tax law years before I met you.” He said, “There is something in U.S. tax law where right now, before the company is sold, we can transfer the entire company into a charitable trust. It’s irrevocable and irreversible, but it means that the entire $22 million will go to charity, and it will never touch your hands. Is this really what you want?”
Derek Sivers
I said, “Absolutely.” Because otherwise it would be like the $22 million would come to me, $7 million would go to taxes, and I’d only be able to give 1$5 million to charity. So you’re telling me that the entire $22 million can go to charity? Hell yeah, do that. I said, that’s great because it’ll never touch my hands. I can never have any, you know, like, “Ooh, maybe I should have bought a Ferrari.” Like, it just won’t be an option. I said, “Yeah, please do that.” So that’s how we structured the deal. The $22 million never touched my hands, and I’ve never regretted it for a single second. It made me so happy, because I just don’t want that life. When I see my friends that have like three houses, I think, “Oh, I’m sorry to hear that. That must suck.” You know, people with six cars, I’m like, “Yeah, that sounds like a drag.” It’s just not the life I want. So I just know myself well enough to know what I want and what I don’t want.
Jeff
I’ll share something with you that you may know, but if not, I suspect you’ll find it interesting. And I think the audience may as well. So the word to own something. I’m a big word nerd. I like to look up words and where they come from. The word to own something comes from an old English worn āgen and āgen does not mean ownership. It actually means debt. To owe is to own.
Derek Sivers
Nice,
Jeff
The same word. And so when we own something in a traditional sense, like we think we own it, we don’t, we now have a burden to take care of it. We owe it. And it’s baked into the history of the word owner, ownership. So I think there’s so much truth buried in word origins. That’s why I like to look them up. Okay. So now you live in New Zealand. Are you still avowedly minimalist? Pretty, pretty simple situation.
Derek Sivers
I love tea, so I actually have, like, 18 kinds of tea stacked up on my counter, and I rotate them every day. So it’s like, I’m not like a dogmatic minimalist that thinks that this is the way to be, but you know, I’m wearing my only pair of pants right now. And we all just have our ways. I think it really helps I’m living off on this island in the middle of the Pacific Ocean. Where nobody’s here to judge me. You know what I mean? If I lived right in the middle of Hollywood or Manhattan. Maybe I’d be influenced by my richer neighbors and I’d be feeling unworthy or something like that. So I think maybe it’s useful that I’m living in the middle of nowhere.
Jeff
Well, before we hit record, you mentioned to me that New Zealand is a lot like California. Like, oh, well, you know, I tell my friends, like, you don’t need to fly out here. It’s like California. But let’s be honest, it’s also not at all like California, based on what you just said.
Derek Sivers
Right. I mean, culturally, right. So, yeah, culturally, I mean, like, okay, look, I’ve got some rich friends that feel poor because they live in Beverly Hills or they live in Manhattan, and their neighbors are richer, so it makes them feel relatively poor. That’s a shame. You know, to me, they are rich and successful, but to them they think, “Oh, yeah, but I’m not quite, you know, Elon Musk level yet.” I’m like, oh come on, just. It’s a horrible way to think about it.
Jeff
Comparison is the thief of joy, as I think Teddy Roosevelt said.
Jeff
Okay. So we’re basically out of time and then some, which means I’m going to open the door for you to say, how can the audience come get more of you, more of what you offer? You mentioned a couple books, like, how would you encourage people to follow up and follow along?
Derek Sivers
My main reason I like doing podcasts like this I’m not here. Like I said, I’m not here to sell a $10 book. Who cares? I really like the people I meet doing these things, so unlike some people, I really like my inbox. I have an open email inbox and I spend 60 to 90 minutes a day answering everybody’s email, and I enjoy it. I really like the people I meet doing this. And actually when I travel the world, I end up meeting people in person that have emailed me over the years. So I recently went to India and met up with like 80 people that had emailed me over the years. And in nine days I go to China to do the same. So yeah, everybody email me, go to my website, sive.rs. I’m not on any social media, so don’t bother looking for me there. Just go to my website and email me.
Jeff
That’s fantastic. One could argue that instead of collecting belongings, you you collect relationships.
Derek Sivers
Relationships, friendships. When I contacted the people in China to say, like, “Hey, I’m going to come to Shenzhen, I’m coming to Chengdu. I’d love to meet up.” They said, “Oh, sure, what are you coming for?” I said, “Just to make friends. That’s it.” It’s precious.
Jeff
What a refreshing take. I’m gonna let that hang in the air. That’s just beautiful, Derek. Thank you for that. Okay. What a wonderful note, Derek. Thanks, man. This has been this has been really fantastic. I’m so glad we got to do this.
Derek Sivers
Cool. Thanks for having me.
Jeff
Of course. And to all you viewers and listeners out there, you know what I’m going to say. You’re the best part of this show even when Derek is on, you’re why we do it. I’m so glad we got this time together. Everyone, please take care.