After Gary’s father Sasha pulled Gary into the family business, a local liquor store called Shopper’s Discount Liquors, he transformed himself into a wine expert, rebranded the store as Wine Library, launched a retail website in 1997, and by 2008 he had raised annual revenue from $4 million to $60 million. In February of 2006, Gary launched Wine Library TV, a daily video blog about wine.
Before we get started, do you know how I’m ensuring that I get paid? By using FreshBooks. FreshBooks helps you save time, get paid faster, and look professional. One of the best things about FreshBooks is that getting started is completely free. Here’s a really amazing thing that they’re doing for Mixergy viewers. They’re giving away a birthday cake every day to a viewer who signs up for a new account. All you have to do for a chance to get your birthday cake is sign up for a new FreshBooks account and enter Mixergy in the “how did you hear about us” section when signing up. The cake is a great incentive, but do it because with FreshBooks you’ll get paid faster.
Next, who’s the lawyer that tech startups trust? Scott Edward Walker of Walker Corporate Law. But don’t take my word for it. Check out what Neil Patel, founder of KISSmetrics, said about Scott. “Scott is a great lawyer. He is affordable, responds fast, doesn’t charge you for a five minute phone call, and always gives great advice.” Walker Corporate Law.
Finally, if your friend wanted to create a store online, which platform would you recommend? I recommend Shopify. Shopify stores look beautiful and they increase sales. So, if you know anyone who wants to start a store online, tell them to check out Shopify.com.
Andrew: Hey, everyone. My name is Andrew Warner. I’m the founder of Mixergy.com, home of the ambitious upstart! Yeah! You want to know why I do this? As some of you know, I was living in Argentina last year and I found myself playing chess incessantly and cursing all the f***ing time, more even than Gary does. More than Gary, so I said, “Where does this even come from?” And then I realized somebody gave me some MP3s of the “Howard Stern Show” down there and Howard curses all the f***ing time. More than Gary and he plays chess incessantly and talks about it.
I said, “Wow, just by listening to this guy over and over talk about chess, I started to pick it up. Just by listening to the way he talks, I started to talk like that too.” Haven’t you found that too? You become the people you’re exposed to and the ideas you allow in your head. The reason I do Mixergy is, not so much you guys can take notes every time, but because I know even if you don’t, just listening to guys like Ze Frank, guys like Gary Vaynerchuk, guys like Tim Ferriss, entrepreneurs who succeed and are willing to sit and talk about how they did it. Haven’t you found it yourself that their ideas, the way that they built their businesses, the way that they think just starts to permeate your life, and that’s the reason to do it.
That’s the reason why I said we’re not going to just do a drunk fest here at South by Southwest, although you’re all welcome to drink after. I said let’s make it about that, those ideas. The first person who I’d like to introduce you to here today, who I’m going to talk to about his ideas, one of my inspirations, let’s give him, please, a round of applause for Gary Vaynerchuk.
Gary, I’ve got to thank you before, before I interview you. Yeah, big, come on another one, thank you!
Gary, I’m going to say this to you. When I started doing interviews, doing video, you said every day just pump that stuff out there every day. Do you remember?
Gary: I do.
Andrew: Do you still say that to people, still give them that advice?
Gary: I do.
Andrew: I said, that’s crappy advice. That’s great for Gary. He’s like a charismatic person. People just watch him. You walk down the street here at South by Southwest, people are paying attention. I said, “I’m not that person.” But I just kept doing it every day because Gary said every day and I trust the hell out of Gary. There were days, like after I interviewed Noah Kagan, I thought . . . I crapped out. After I interviewed Gary, I was shaky in your interview. People who go back and see it will see me shake. I didn’t want to do it ever again.
I said, “Gary said every day.” Now, you can see the interviews get better and better. People are actually watching, Gary, check it out.
Gary: I can see.
Andrew: Thank you for that and let’s find out a little bit more about you and learn more about how you built yourself up.
Gary: I just want to mention that the people sitting here, you probably have a pencil at your table or at your seat, excuse me. After the interviews are done, I’m more than welcome to pencil fight anybody. I’m one thousand percent convinced that there’s nobody in this bar that can beat me in pencil fighting. I just want to recognize and back the f*** up. All right. I’m ready to go.
Andrew: Gary, I see you a lot. There are people here in the audience, including Damian who was introduced earlier . . .
Andrew: . . . who on their Twitter accounts, their picture is your book on their face.
Andrew: How do you get people to put your book on their face?
Gary: I think you ask nicely. You know my thesis on “The Thank You Economy” and why I think people would actually put my book over their face on their Twitter feed for the last week is based similar to what I think about parenting. I think the reason that we all love our parents so much is because they loved us first.
When I think about business and relationships, I always want to give first. Early and often, so that when there is an opportunity where I think I need something and as long as that’s not too often, I think I’m able to come in and ask for it in those moments when you need it. So, I try to give as much as I can, and then, hopefully, when I have a need, I can go back to that relationship and ask for it.
Andrew: So, you’re saying it’s because over the years, and I know this firsthand, you just give and give and give into people. When it’s time for you to promote your book, “The Thank You Economy,” you can go back and draw on that and say, guys, can you help me out by promoting, by putting my book, “The Thank You Economy,” over your face.
Gary: Yeah, I mean, I think it’s an unfiltered giving too. I think way too many people, when they get asked to do something, try to figure out how many Twitter followers the person has or what’s their title or they’ll Google them and try to figure out who they are. There are a lot of people in this room right now because they’ve got entrepreneurial spirit. If you’re here right now, listening to these set of interviews, you have a certain DNA. What that tells me is that you may not be dominating right this minute but in all likelihood whether it’s next year or the year after . . . I see a lot of people in the crowd that I know where they were three or four years ago and I know where they are today. There’s been a lot of growth in their business and the things they can bring to the table. That’s what I think about. I know who I am and I know that when I first came into the tech world, some people thought of me one way. Some thought the other way. But I knew that everybody who didn’t step up and wanted to have a relationship with me was going to miss out because I was going to be one of the biggest f***ers in the game. I always think that too.
I hate when people vet based on certain data points. To me, it’s about DNA and how they roll. I just like to give. I think there’s enormous opportunity. Doing the right thing is never the wrong thing.
Andrew: Gary, let me ask you this, you’re always so confident. I think in our interview, you said, “I am a badass.” You actually said that. Do you ever get to a place where you say what if I’m going to fail here and I’m going to embarrass myself? I’ve said to everyone in the audience, I’m a badass. I said it on my show. I said it on TV.
Gary: I’ve said way worse. I told everybody in the audience and the world that I’m going to buy a billion dollar sports franchise, right?
Andrew; So, do you ever just have those moments of hesitation? I’ll tell you why, because if I see you just doing that and then I experience in my life hesitation, I experience insecurity in my life, I go, “Gary never feels it. I do feel it. Gary must be a winner. I may not be nearly, I may not even be able to aspire to that.”
Gary: I think it comes down to a couple of things. I think that my mom instilled such an ungodly self-esteem in me, that I just believed it. My mom told me . . . I’m still stunned that I’m not the best looking person in the world. Like, somewhere around my late twenties, I was like, s***, maybe I’m not.
So, my mom did her thing. I have a 21-month-old daughter, and really more importantly than anything else to me is I want to make sure that that little girl, as she grows up and goes into the world, knows that she’s the best. Here’s, I guess, you want me to open up, here’s the thing. From a business standpoint, it just doesn’t matter. Like I want all these things, but, if you roll up on me when I’m 79 and dwindling it down or 86 or hopefully 94, you’re like, damn Gary, you didn’t get the Jets, I’m not going to care. I can promise you that right now. I’m just not.
To me it’s the chase. The chase is the game. That’s why I love business so much. It’s not the money. It’s the sport of it. The reason I want to win and build big businesses is to show my skill set versus all of you. I want to be better than you. I want to show that I have better business chops.
Andrew: So why do you help the same people who you want to beat?
Gary: Because deep down I think I may need everybody to donate five bucks to me to buy the Jets? You think Kickstarters got something? What until you see what I’ve got in 40 years. You know, when I panic late, I think I’m going to go for it. I think it comes down to I believe in . . . it’s so weird. I hate that I’m like “The Thank You Economy” guy and like the nice . . . it blows me away that I’m the “nice guy,” that people view me that way.
My first business was that I ripped up flowers from my neighbors’ yards, rang their doorbells, and sold it back to them. I’m a true salesperson. I’m not here to be Mother Teresa. I have no interest for all of us to go rock climbing and drink tea and hold hands. I want to make money. I want to build businesses. I just believe . . .
Thanks. I just really believe in a world that’s so ridiculously transparent, that’s so built on word-of-mouth infrastructure, that, jeez, your social currency is going to be a major factor in the way you do business. That’s why I’m doing it. No real good Zen reason because I believe that it’s going to help me in business. That I feel like if you do the right thing that there’s a shot for you to come back and ask for something in return. So I try to do the right thing in business whether I’m the lead. I’m happy to give 80% to the relationship because I just think it comes back, I just do.
Andrew: Can I interview your mom? Shouldn’t I be able to interview his mom?
[audience applause and cheers]
Gary: Tamara Vaynerchuk is a beast, meaning she’s really, unbelievably, she is an unbelievable human being. I mean, she won’t do it. I’ll ask her for you. She hasn’t even showed up “Wine Library TV,” and episode 1000 of “Wine Library TV” is airing on Monday.
[audience applause and cheers]
Gary: Thank you. I’ll ask for you.
Andrew: All right. Done and done, you guys all heard and he’s very persuasive. Call back some of the favors that . . . no, maybe you can’t.
Gary: She’s got too many in her camp.
Andrew: Gary, I have, I was going to say used you, I’ve got to find a better word than that but really, if everyone goes on to Mixergy.com, they see a picture of Gary.
Andrew: The reason that you’re up there is because you help to get me hits and because other people, who I want to interview, admire you and they go, “All right. If Gary said yes, I’ll do it.” Right?
Andrew: I got you to help me there. I asked you before there was an event here, before you knew whether it was just going to be out of my backyard or whether there was a location, I said, “Would you speak?” You said, yes. That helped get me an audience. I’ve turned to you so much to give me stuff. How do you know that I’m not going to just dick you over, sorry, and you get nothing in return?
Gary: Mainly because if you do dick me over and I get nothing in return, then it’s going to be okay, right? I’ll then know that you’re not somebody I can rely on, that doesn’t understand what relationship is. I try not to sit on an ask too long. You try to ask eventually. I mean, I’m not going to sit on something for 30 years and just keep giving, because it’s not practical smart business for me. But I just find it an inexpensive way to figure out who’s a douche-bag and who’s not.
I’m willing to give and if I go for a play-back and it’s not there for me, if I ask you to blog about my book but you throw me a tweet instead, I understand what that is. I analyze all those things and I just continue to pay attention to those things, make decisions. Not everybody is a good person, you know. What I mean by that is everybody’s a good person. I think people are good, really. I think humans are massively underrated. But not everybody . . . I just think a lot of people are selfish. They’re running sprints instead of marathons. I’m running a marathon. People are running sprints. That’s makes them make poor decisions, in my opinion, and that’s fine. That’s just makes me not want to do for them in the future. You know what? I know how important I’m going to be in this space my whole life. I find great pleasure in when somebody’s not good to me that when there’s a big opportunity on the table for them and I’m involved with somebody thinking about buying their company or investing them, have I turned people away from investing in startups because that person hasn’t been good to me and I don’t think they’re a quality person? One hundred thousand percent.
Gary: There are a lot of people out there that are hurting because they’ve hurt me and don’t even realize it. When you’re going to be a power player, you’ve have a lot of power. I’m not trying to hurt people, but doing the wrong thing is the wrong thing. I think sometimes you can’t see how you’re being hurt when you’re doing wrong things. I think those things are fascinating to me.
Andrew: For example, who have you . . .
Gary: I don’t think it’s appropriate for me to say because it puts me in a really tough spot, because the person’s actually somebody I’m fairly close to but I don’t think is a quality person and I wouldn’t want this person to put $250,000 into a company of a person that I don’t think is a quality human being, period.
Andrew: All right. You’ve got a lot to give. You just come and do an interview with me. I end up with, it’s money in the bank for me, right? At least it’s an easier life because you’re on the site. What if I don’t have that much? What if I don’t have a presence like yours? What if I don’t have cash like you apparently have? Should I ask him the question?
Andrew: What about people who don’t have that, how do you get started?
Gary: I didn’t have that. Let me tell you what my first tech event, AJB are you in the house? Me and AJB’s first tech event, ever, was that me and AJ flew to San Francisco to a Leo Laporte Jiku Party. Remember Jiku? I flew out there. This is I’m already running a $45 million wine business. I’ve just started “Wine Library TV,” and I fly, on my dime, and send out wine, on my dime, to serve wine – to serve wine – at Jiku Leo Laporte meet-up. I was the help that day. That’s what I did. I’m happy that I have that DNA. I never think you’re too big enough to do anything. I continue to do things that all the people in my world, my agents, my PR people are baffled. We’ve got this CNN thing. Why are you doing like . . . what should I do on business.org interview instead, right?
I don’t think it makes sense to try to figure out what things to do based on, back to what I was saying earlier. If you’re small, you have a lot to give. You have hustle. You have sweat equity. Come and work this event and set up the chairs. There’s a starting point for everybody. I still think I’m starting. Listen, I’m going places, and when you’re going places, you’re always growing. You’re meeting with bigger people. I was in A-list celebrity’s home on Friday telling her what to do. Like “A” A-list, right? That’s a bigger league for me. I have to take my shoes off and everything.
I think you’re always growing and you’re never too big to do dirty work. I think if you perceive that you don’t have anything to bring to the table, you’re making a huge mistake. There’s always a need for something. I think, that’s what I was, I was the help to a Leo Laporte Jiku party. There was like 30 people there.
Andrew: That’s kind of clever, though. I love your creativity. I wouldn’t even know, even if I was selling wine, I wouldn’t know to bring wine and to say, “Hey Leo, let come and hand it out.” I wouldn’t think to. I remember the first time that I met you, you had different wristbands and you were handing them out and everyone at the party had one of your wristbands. Where does the idea come from for the wristbands, for handing out wine, for doing something that’s a little bit different?
Gary: You know I’m marketer, right? I had a very big baseball card business when I was 12, making thousands of dollars a weekend selling cards. It was because I was good at marketing. I watched sports every second of my life, and if I was doing a baseball card show the next day, I would not make stuff up, I was being creative. I’ll never forget Mark Whitten, of the St. Louis Cardinals, one day hit four home runs in one game. The next day in school, I bought every single kid’s Mark . . . God forbid I had the Internet, I would’ve dominated. I bought, through word of mouth, like in the hallway, the next day I bought like 80 Mark Whitten cards. They were like 10 cents in Becket. He was a common. But I was doing the show and I made this huge display at the table. Mark Whitten hits four home runs. I got people excited and I sold what was a 10 cent card for 2 bucks and it worked. It was based on projecting. It’s no different than all the pitching I get every day. We’re going to be a trillion dollar company. You tell me why and then sometimes I believe and sometimes I don’t.
I have creativeness when it comes to selling in my body. I’m a salesman.
Andrew: When we talked, I kept pushing you and pushing you on this because I’m just such a dork, I need details all the time.
Gary: Yeah, you’re very good at what you do.
Andrew: Thank you. I need specifics and I remember, actually, I asked you how do you come up with like Vaniacs and you . . .
Gary: That’s from Hulk Hogan, Hulkamaniacs.
Andrew: You also said, “Look, Andrew, I admit, I didn’t come up with it myself. We had the forum. I’m really good at picking up ideas that other people have and knowing that they’re going to be good ideas.” You said Vaniac somebody came up with and they had a bunch of different names for what the fans should be.
Gary: You guys are almost the wine librarians.
Andrew: Right, and you knew not to pick it. So, for example, the wristband, where does that come from?
Gary: Me and AJ like basketball. We’re little white guys that like basketball. So, when you’re a little white guy that likes basketball, you wear all the gear, right? I wear high socks, headband, wristband. You just do that kind of stuff. It just felt right. There was something that actually did happen. I’m trying to remember. Something where I actually played basketball, had the wristband, was tasting wine, it spilled and I used the wristband. I was kind of like interesting.
Andrew: Was it something like that?
Gary: It was something like that. I definitely think that swag is interesting. I want my swag to be something I would wear. It’s just . . . I mean, look at the pencil thing. I love pencil wars. I know I’m good at it. That gives me the good feeling that I’m going to whip everybody’s ass later. I’ll feel good. It would be worse if I lost, right?
I like creativity. I like to think about what people are going to do, what people want to do. I’ve been to South by, what do people want. There’s always down time, different things. Just always thinking, right?
Andrew: What’s the marketing logic behind doing pencil wars?
Gary: That’s no marketing logic. That’s self-esteem logic. I know I’m the best pencil fighter in the world. After I beat everybody, it’s just going to feel good.
Andrew: I see. So trashing the people who flew all this way to love you and to listen to you, that’s love.
Gary: I very much like to win.
Andrew: Let me try this. How does pencil wars go? Do you want to do just one shot?
Gary: Let’s be authentic. We just already played pencil wars before we started the interview and I beat you pretty badly.
Andrew: You did beat me pretty badly.
Gary: So, I don’t think we really need to do anything. You’ve taken your loss.
Andrew: My new wife is sitting right there.
Gary: Yeah, I know, I know. She’s lovely. I trashed her husband’s face in.
Andrew: Who do you see who can think this stuff through mechanically or not mechanically, but I want to know that this isn’t just like marketing is something that God blessed Gary with and Tamara Vaynerchuk pushed and pulled out of him and the rest of us are screwed because it doesn’t come through. Who do you know who’s doing it well and methodically? You know Tim Ferriss is going to speak here? He will analyze everything and break it down into 20 steps for you. Who does that well, marketing well? How can I learn to market the way that you do in 20 steps? Is that possible?
Gary: You know, I’m not good at this question because I believe that . . . I’m not a good learner. So I don’t know how to answer this. I don’t feel like I’m good at learning from anything. I’ve never learned anything out of a 20 step or 10 step. So it’s hard for me to explain it, because the way I work is I reverse engineer. When something catches my attention, I understand that my attention has been caught. I stop, I pay attention to what was done, and I reverse engineer it into what would work for me.
I believe that people underestimate DNA. I think that learning is awesome. But if you’re like me, I think what’s important to do is understand core strengths. I really do believe that one of the best things . . . I hate when people roll up on me and are like, “I want to be like you. I’m going to be like you. I’m watching what you’re doing. I’m going to do it like you did.” I’m always scared that they don’t have the natural DNA to do that. I always wonder is there something that you could do that I couldn’t do. I want to be the quarterback of the New York Jets, but I don’t have that DNA. Look, nothing, I don’t have that DNA.
Around fifth grade, I realized that I was more likely to buy the Jets than play for them. I don’t really know how to answer that question to you. You’re talking to somebody who sucked at school for that reason. What I’ve been good at is really, really knowing who I am. It’s funny, you continue to evolve that. There’s something I learned a couple of years ago, guys. I look at the Wistia guys and AppSumo, there are people that are good at building things. I had to be really real with myself in the last year and half. I’ve come to realize, for example, I’m getting a lot of love in my inbox lately becomes Tumblr is exploding.
In “Crush it!”, I wrote how important I thought Tumblr was and I put it on paper. I was on stage in ’07 and ’08 talking, I’m telling you, I think there’s something here with Tumblr. Now that Tumblr is really exploding and establishing itself as one of the really three to four biggest properties in the game, people are hitting me up and saying, “How did you see that?” What I think I’m good at is seeing things early and practically. I think we all know augmented reality is coming. We’re all going to walk into a store with a phone and look at the product and there’s going to be information. But I think it’s too early, it’s not practical. I think about that.
I think I need to be real with myself. Maybe I’m not going to build . . . when AJ and I evolve out of VaynerMedia, we want to do something. I was like maybe I shouldn’t do a startup. Maybe I’m just not that guy. I want to think I am, but what I’m really good at is seeing something within the first month. That’s what I did with Twitter. That’s why I started angel investing, because I want to make more money on that skill set by seeing stuff early. I’m starting to realize that maybe I shouldn’t do a pure startup. Maybe I should go the Tony Hsieh route. He was investing. He saw Zappos. He’s like, wait a minute I could run this better.
I’m an operator. That’s what I really did the first time out. My real street cred comes from building a $60 million business, but it had a multi-million dollar base. I didn’t start from zero like a lot of you are trying. I came into something and, listen, taking something from three and change to twenty in two years takes an amazing skill set too, especially when you’re dealing with family dynamics. If you’ve every tried to work with a parent, I had to eat a lot of s*** while I was building that. A lot of emotional stuff with my dad not letting me do stuff.
I’m trying to be real with myself even . . . I’m trying to eat my own dog food. I’m starting to realize, huh, I need to really think about this. Maybe I shouldn’t be thinking about what I need to create. Maybe I should be really paying attention and jump in on something, buy a big percentage of it, and help them take it to a billion dollar level.
Andrew: You give me two things that I want to dig into. The first is this, Cork’d. Why didn’t Cork’d work? It’s your social media site, your social networking site around wine loving. Why?
Gary: A couple of reasons. Cork’d didn’t work . . . so, you know what? You like getting the real answer, right?
Gary: I’ll give you the real answer, and it’s the first time I’m ever going to tell the real answer. The real answer is that my dad and I bought Cork’d through Steklen and Walker. Then somewhere along the line, I walked in and said, “Dad, I want to own this because you’re not going to do anything. You’re not. I’m going to do everything and I’m going to get mad at you for owning 50% when I’m going to be up until 4:00 in the morning every day.” It made it a weird relationship. He didn’t take it poorly. My dad loves me more than life. But I knew that no matter what happened from that day on after that conversation that I would never win with Cork’d. Because if Cork’d went on to do $100 million, in the back of my mind, either I would’ve been upset or my dad would’ve always – listen I love my father – but he would’ve kept it over my head. I wasn’t willing to deal with that emotional stuff. That’s kind of why I segued out of “Wine Library” to begin with.
The real answer was Cork’d pretty much died three months after I bought it. I sat on it. I brought in a CEO. I wanted to learn that process. That was a great learning opportunity for me. I probably spent seven hours on Cork’d in the four years that I had it.
Gary: So, that’s the truth.
Andrew: Why not give him then part of the business or find a way to make it right with him and then go in it all the way and crush it the way you did everything else?
Gary: Because I played that game before and that doesn’t work for me. I’m a solo artist. I’m giving you real answers. It’s a tough dynamic for me. That doesn’t work with my DNA. I’m very confident in what I bring to the table. What starts happening is I start getting mad at my partner in crime. AJ’s very different than my dad. That’s why that felt comfortable to me. I love my dad and we built a business together. My dad and I are very different personalities. Anybody here who’s ever worked with a family member or a best friend, there’s a lot of dynamics.
When it’s your dad, the dad that took you from Russia to America, the guy you look at, like, man, if you weren’t that brave to take me, I would have none of this. At the same token, man, you’re putting a ton of f***ing emotional pressure on my neck and I’m building this company. There’s a lot of dynamics that happened in my family that a lot of people don’t know about. I’m trying to give you a little something because I’m trying to help you continue your brand building as the guy that gets real information.
I’m coming through for you right now. This should show you a lot. I’m sharing a lot more than normal. Cork’d lost because of family dynamics and I feel great about the Cork’d story. I’m thrilled to write it off. I want it to go away. Dan Benjamin and Dan Cederholm, I’m sure hardcore . . . Damon’s a hardcore Cork’d guy. He’s got the original Cork’d t-shirt. They didn’t do anything with Cork’d either the last 18 months. I love Dan and Dan, but I bailed them out. They didn’t do anything for 18 months. We walked into a s*** show.
I don’t want it to be misconstrued that I took this great thing from Dan and Dan and then f***ed it up, because that’s not the truth. The truth is it was in trouble when I got it. The day I bought it, “Wine Library TV,” I was on Conan a month later. So, the “Wine Library TV” stuff exploded. The real answer is I decided to kill it because I didn’t want to deal with the emotional baggage.
Andrew: You and your dad, wow, you and your dad aren’t working on anything together, not even on “Wine Library”?
Gary: Oh, absolutely, we work on “Wine Library” and I love it. We’re in a better place because I’m not all in on “Wine Library.” Let me tell you something and I think you’re going to find this interesting. There’s something interesting I realized about me and my dad. I’ve been trying to figure out why corporate America sucks so much. Because the people we work with are smart, they’re not idiots. I hate when our space goes, “They don’t get it.” They f***ing get it. They can read the same f***ing TechCrunch article you read. They get it. But they’re not doing it for a reason, and it’s a selfish reason. They’re trying to get promoted, and if they do something risky in social instead of television, that could hurt them. There are a lot of reasons.
I realized recently why it really is happening. My dad and I, I cried many a days. My dad left running out of “Wine Library” driving home upset, many a days for one reason. Because my father and I, for the ten years that we worked every day together, every decision we made was in the best interest of “Wine Library” and had nothing to do with what was good for us. We didn’t vacation. We f***ing fought so hard and we fought so hard, both with what we thought was best for “Wine Library,” not what was going to be easier or better for us.
Most people don’t do that. Even in the startup world. I pay attention very carefully. People want to hang out with the other internet celebrities. They want to get funded by Fred Wilson and Chris Sacca. They want to be on TechCrunch’s homepage. They don’t want to build the business for the business. They don’t care about the business more than they care about themselves. I care about every business I build more than I care about myself, period, end of story.
Andrew: What do you mean? What’s an example of a decision that you made that was in the interest of “Wine Library” but not in the interest of the Vaynerchuks?
Gary: Our salaries, our vacation time. We have this opportunity with the Wine Spectator to do a full page ad even though we’re over budget, pretty heavily over budget. Do we do it because we think long term it’ll be good? Yeah, let’s do it and let’s not take bonuses this year. Dad, I really believe this employee . . . I’ve spent hundreds of hours of my life fighting for employee benefits because my dad comes from Russia where your employee is your enemy. My dad spends all his time thinking our employees are going to steal and he doesn’t like them. That was a very painful ten year process to get him to a place where he actually has some belief in our employees, because prior to that, he really viewed them as the enemy. I view the employee more importantly than the customer.
So, you can have a lot of f***ing fights when you walk into dad and say, “Dad, we need a 401(k).” “F*** that.” And then you get f***ing thrown out and it’s hard. It was very painful battles and everything, but my dad always came for the business too. It wasn’t that he wanted to take more money. He just viewed things a little bit differently than I did, and they were very, very interesting . . . listen, AJ and I are very, very different.
I look at AJ for this first year and a half and I commend him. I’m a busy guy. I’ve thrown a lot of responsibility on his shoulders. He’s got a lot of stress, and more importantly we view things differently, even our own employees as well.
Andrew: Are you guys 50-50 in the business?
Gary: We’re 50-50.
Andrew: In VaynerMedia?
Andrew: How is it you could be 50-50 with AJ? A guy, who admittedly, when I interviewed him a long, long time ago – thank you for being one of my first interviewees AJ – I said you’re riding your brothers coattails, and he said, “Yeah, absolutely. I love my brother and I’m riding his coattails.”
Your name, your brand, your work is building the business. How do you share it with someone else then?
Gary: My dad had a big disadvantage. I didn’t watch those first 14 years of him bleeding to set it up for me. I walked in and took control and f***ing took control. Everything I’ve ever seen, my dad gets the raw end of the stick. That’s something I can be a big enough man, at this point in my career, to say. I wouldn’t have said it five years ago. I didn’t watch my dad bleed while I was a kid to build the foundation that I could. With AJ, I get to see it and there’s something about seeing it. Plus there’s a different dynamic when you’re the son, you’re trying to climb. AJ’s 11 years younger than I am. We’ve always had brother-father kind of relationship. I was 17 when he was 6. There’s something . . . it’s a different relationship. Listen, I’ve got to be honest with you. I think from where I am today and where the world is today, I view AJ as outrageously capable and a huge asset to me. Pure emotion out the window, I just believe in him immensely. As we’ve been building VaynerMedia, on a weekly basis with every client, one by one, I get the, wow, AJ’s awesome, because he as the disadvantage of is this kid riding Gary’s coattails and then he goes and executes. I’m very compassionate to AJ, because when I came into my family business, they’re like, “Oh, another . . .” There were a lot of sons that came into the family business of the top ten liquor stores in New Jersey, and they were all ass clowns. Then I came, and everybody was like, “Oh, another clown.” I was like, “F*** that, I’m the best of all time.”
I struggled when people didn’t invite me to the meetings because they thought my dad . . . I mean, there was a point in time when I took the business from 3 to 20 and I was still not getting invited to the meetings. I was, like, “What the f***? Is anybody paying attention?” I know what it feels like to be, like, oh, you’re working. Like coming back from college the first couple of years, my friend’s mom saying, “Oh, you work for your dad?” In mind, I was like yeah, and in my mind I’m like f*** you lady, your son doesn’t have dick compared to me.
I’m very compassionate to what that feels like, and it’s a very difficult place. I haven’t been there in a little while now, but I lived in the umbrella for many years. AJ, let me tell you something, my brother has taught me a lot. He’s made me much more of a gatherer and farmer. I’m naturally a hunter. I just want more clients and more business and more stuff. He’s really done a good job in showing me a way of doing a better job once you have them. I respect him very much.
Andrew: Did you say . . . earlier when you brought it up, did you say transition away from VaynerMedia, the company you guys started about three years ago?
Gary: Yeah, we started it not even two full years ago. Client services is not a business that a guy like me likes all that much.
Andrew: It doesn’t scale well, right?
Gary: You know, I hate Timmy Ferriss, yeah, I mean, I think it does scale. So I’m taking the challenge. I have a concept that is going to try to make it scale. I think, I just know what I want to do, which is I want to build a big business. I very much believe in what we’re doing. I do believe that community management is going to be a massive battleground. I know the network effect on your social spend. My whole book, “The Thank You Economy,” is the thesis of what the value is in that. I know people are going to see the ROI because I live it and I think we’re going to have a big business. I think we really know what to do. I really, really know what to do, and I think that I’ll big a business and one of two things will happen in a couple of years.
I will allow my internal people to move up the ranks. A couple of people will take the CEO and the COO job and they’ll run it, and/or because of my brand equity, we’re going to get a very high exit from a major, you know, an Omnicom, a big Saachi and Saachi, a big conglomerate, right. They’re going to come in and pay us a huge variable against our business and we’ll look at that as well.
Yeah, I mean this is not the end of my career. This is not what I’m going to be doing for the rest of my life.
Andrew: What would you like to be doing for the rest of life?
Gary: I don’t know.
Andrew: You don’t know yet?
Gary: I will tell you that what I pride myself in and what I think people are not good at is reacting to the marketplace. I’m a reactionary kind of guy. I’ll feel something . . . I do think in the back of my mind, lately I’ve been thinking about retail. I know it. I’m good at it.
Andrew: Online retail?
Gary: Yeah. I understand retail, so I’m thinking about retail. Watching the whole living social thing come from the Woot. Woot is the reason I’m sitting here in front of you guys. Erik Kastner, if you don’t know who he is. Erik Kastner, he’s here at the conference, was my lead developer. He showed me Woot in 2005. I looked at it for 45 minutes and I said, “Motherf***er, this the site I should’ve launched. I love this.” It inspired me to get more . . . this is a very fun day for me the fact that Ze Frank is taking the stage next. Ze is the reason I started “Wine Library TV.” My developers watched Ze Frank at lunchtime. They laughed super hard. They loved him. He was the best, the duckies, and all that. One day finally, I’m like, “God, they loved this guy.” I walked by and said a competitive comment like, “I could do that.” They’re like, no way. No, Ze is like, you could never do that. I was like, f*** Ze Frank, and I said, “I’m going to do this.” I decided to start “Wine Library TV.” To see Ze here and see Erik from Living Social, which for me emotionally ties back to Woot, it’s pretty interesting for me to be here because Woot and Ze Frank, very interestingly different, were catalysts to me saying let me pay attention to the Internet a little more. Not just an ecommerce situation anymore. This thing’s evolving. I need to understand every nuance.
Andrew: You invested in Ze Frank’s company.
Gary: I did.
Andrew: Why? What was it about his company? I’m sorry. It’s called Ze Frank Games, right?
Gary: Yeah, I saw Ze Frank at Internet Week, I think it was like . . . it might have been the first time we ever met in person. I saw him in passing. I’m like Ze, “How you doing?” He’s like, “Great, great.” I’m like, “If I can ever be of help, you know, love to do some stuff.” He goes, “Yeah, I’m starting a company out . . . I closed my round today.” I’m like, “I want in, reopen that s***.”
It was because of a couple of reasons. I think Ze is extreme. I think creativity is very, very rare. I remember back to when Ze was doing “Color Wars.” For any of you early Twitter people, how many people remember “Color Wars,” raise your hand. How many people where part of the very green team?
I remember that and I just remembered . . . I believe in him a lot. I believe in him and that’s why. He also told me, I believe in virtual currency. We have . . . everything Ze has done; there are things that I enjoy. I believe in him very much and I think he’s very, very creative. I think there are very few people that are creative. What Ze did and what I do with “Wine Library TV” takes execution ability. I think there are a lot of people who have ideas, but there are very few people that can and want to execute.
Execution is the game. I believe Ze has that. I also believe that I can bring input into that. I think Ze and I could talk on the phone and that I could bring value to his business because I feel like I have skill sets in the way he thinks. So, when I feel that I can bring value, that’s when I get excited. Nobody needs me for money. I don’t have enough of it. There are much bigger institutions with cash. I like to get involved in things where I think my brain power, not my marketing ability. I think people think that I invest because I can tweet about it and give it promotion. That’s horses***. That means nothing. For me, I’m very passionate about product. That’s what I get into.
Andrew: Before I ask you your last question, Ze’s coming in? You know I like to learn from people. What should I ask Ze? What should I learn from Ze when he comes up here?
Gary: What would be really fascinating from Ze is finding out . . . I mean he was so early on video blogging. When him and Rocketboom were really the two brands. There were some things that were going on. I think Rocketboom did a TiVo deal. I think it would be really interesting for me, listening, to know some of the biz dev opportunities he passed on in the beginning. How crazy did it get? Obviously, we know he got some Hollywood deals and things of that nature. What business . . . did Samsung or Sony or Apple come along and say we want to do this? Don’t forget, listen, I think in ten years every person in this room is going to spend an enormous amount of money on virtual currency, real money. Ze was selling virtual currency, big ducks, small ducks. I’d like you to ask him and understand what his thought process was. Was he watching what was going on in South Korea with Cyworld, or was he just innovating coming his . . . where did that come from? He was doing something in 2005, ’04, ’06, that is probably not going to be a big trend until 2016, 2017. He was executing. People were buying those f***ing ducks.
Andrew: Yeah. I talked to him before this. He said it’s okay for me to talk financials with him. Maybe we’ll find out what the numbers were there.
Gary: Cool man.
Andrew: People love it when I ask at the end of these interviews for one action step. What can they do at the end of this interview to use what we just talked about? I don’t think that everything needs to actionable, but if we can leave them with one thing what would that be?
Gary: I would say this. I think here’s the most fascinating actionable thing. I think when you’re building your business, what’s amazing about 2011 is that nobody is inaccessible. I think you should go in with that mindset. Because people help, people are the game. I sold 10,000 books last week based on like seven different people. That’s a lot of books. I’ve been doing a lot of hustling by myself to even get to a thousand. I think as you’re building your business, think about those 15 to 20 people that you really think can help your business.
Don’t take no for answer. Try to get in front of them. Almost anybody is . . . you can get face time. It’s incredible. If you suck, you won’t, because when you pitch them or try to get to them, it’s going to seem weak. Think about it. Understand what you’re doing. Understand that you can get the people and understand that people . . . and that’s what I love about, I call it the humanization of business. The human element, scaling people, people are massively important. We talk so much about scale in this industry and we forget the human element. I’m very fascinated by the human element. Think about the human element, understand it, and understand that you can get the people that can help you dramatically.
Andrew: All right. I hope you look to me in the future to help you. I owe you so much and your brother. If there’s like a little Vaniac somewhere, little Vaynerchuk, not a Vaniac, who comes up and says, “Andrew, can you help?” I say yes. I owe you guys so much. Thanks for coming here and thanks for doing the interview.
Gary: Thank you.?