Joining me today is an entrepreneur who says he turned $820 into a company worth $450 million.
In 1982, Dan Peña founded Great Western Resources Inc., (GWRI), a Houston-based natural resource company.
He ran it until he had a falling out with his board of directors, about 10 years later.
I invited him to tell that story, and to talk about what he’s done since then, including how he renovated his castle and opened it to the public.
Dan Pena, The Guthrie Group
Dan Pena is the founder and Chairman of The Guthrie Group, an investment consortium.
Andrew: First three messages.
Who is the lawyer that founders in the Mixergy audience trust? Scott Edward Walker of Walker Corporate Law. Have you seen what Chris Pritchard posted on my Facebook page? His new company’s incorporation pages, that Scott Edward Walker helped him get. Scott Edward Walker is the lawyer that publications like Forbes trust. Go to walkercorporatelaw.com.
Next, when my friend had to close her company’s office, but still wanted to give callers the impression that all her employees work well under one roof together, what service did she use? Grasshopper. With Grasshopper, everyone who works for you can have an extension. They can pick up calls on their extension no matter where they are or what phones they use. And they can transfer calls to each other, back and forth, with ease. Get those features and tons more at grasshopper.com.
Finally, when Dave Jackson and Dave Petrillo that keeps coffee at the perfect temperature, what platform did they use to create their online store? Shopify.com. Look at how beautiful their store looks. It’s because it’s built on Shopify. They did hundreds of thousands of dollars in sales. Shopify stores are designed to help you sell. Patrick Buckley invented an iPad case and used Shopify as his online store. Within months, he sold over a million dollars in cases. Get your beautiful online store at shopify.com. Here’s your program.
Hey there, freedom fighters. My name is Andrew Warner. I am the founder of Mixergy, home of the ambitious upstart.
Joining me today is an entrepreneur that says that he turned $820 into a company worth $450 million. In 1982, Dan Peña founded Great Western Resources, Inc. A Houston-based natural resource company. He ran it until he had a falling out with his board of directors about 10 years later.
I invited him to tell that story, and to talk about what he’s been doing since, including renovating and opening up to the public that castle that he’s talking to use from today. Dan, welcome.
Dan: Thank you. Good afternoon here in Scotland. Welcome to Guthrie Castle. I look forward to the interview.
Andrew: Me, too. There’s so many different stories that I want to ask you about. Why don’t I start off with you sold a tax shelter to the Mafia? Is that right?
Dan: Yes. In the early ’80s, when I founded Great Western in February of 1980. Or August of ’80, excuse me. There was a law that was in existence called the Tax Reform Act. You could sit down and utilize accelerated depreciation amongst other things to get a bigger write-off. So if you put one dollar, you could write off two, three, four, or even five dollars. The oil business was one of the ones to take advantage of that. So the Tax Reform Act of ’86 changed all that. Back in the early ’80s, we sold cash shelters to get cash flow in to get our start.
One of our sales agents was a guy from New York City, a very, very prominent salesman. In fact, the best salesman I ever met. Sold several million dollars worth of the tax shelters to one of the main Mafia families. He owned it. But then oil went from $40 a barrel to $10 a barrel, so all of our shelter and all of our equity was wiped out. It was just like a margin account. In 1984, we took the company public in the UK on the London Stock Exchange. I called back. This is about the summer of ’84,. Actually, it was fall of ’84. I’m talking to our Chief Financial Officer, who was a former Coopers & Lybrand [?] partner. He said, “we have guests here.” I said, “What do you mean? Why are you whispering?” He said, “Because I’m standing in the hall.” I said, “Why are you standing in the hall?” He said. “Because they’re here.” I said, “Who’s here?”
To make a long story short, he said one of the senior Mafia bosses was there with his two bodyguards. Both bodyguards were about 6-foot-5, 6-foot- 7, and weighed about 300 pounds. So they could block off the light. I said, “I’ll be right home.” So I flew back to Los Angeles, where we had an office there at the time. I met the gentlemen, and we went out to dinner. And he’s explaining to me that he doesn’t care about oil going from 40 to 10. He doesn’t care about anything. He just, “I want my fucking money back.” And he leans across like that, and he’s a very dapper guy and well-dressed. So I tell him, “I can’t give you the money.” He said, “In your statement, you’ve got the cash.” Which I did. I said, “We’re a public company. I can’t just write you a check for $5 million.” And I said, “Even if I could write you a check, I wouldn’t write you a check for $5 million. You took the risk. I lost money myself in the tax shelters.” He said, “You don’t understand, Mr. Pena. I want my f***ing money back.”
To make a long story short, I didn’t give the money back and he sued us. And as the DA in New York would say it, it’s the first and only time they’ve ever known of the Mafia suing, not just the guy, but public company involved for money. And we drug it out in court for a number of years. We actually had a shareholders meeting, which he attended because he was also a shareholder in the company because it was public. And we had an open-vote shareholders meeting where everybody raised their hand to do such-and-such, and he stands up and he pounds the desk that he was sitting by and he said, “All your votes are cancelled. My one fucking vote cancels all your votes if you know what’s good for you.” Needless to say, a lot of the shareholders were frightened. And we ultimately helped participate in a case against him where he was convicted. And he had to wear an ankle bracelet. Then they got sick. He was one of the first guys to get sick because all the mafia guys get sick and then they can’t go to jail.
Andrew: I see.
Dan: But the real problem was, I personally picked up the check from him personally, myself. I went to his office in New Jersey.
Andrew: The original check when you guys sold him the tax shelter? You picked it up.
Dan: Even though I didn’t do the selling, I collected the money because he wanted to make sure that the CEO knew who the money was coming from. So I went to his big construction operation in New Jersey. And he said, “Your name Pena. Pena.” And I go, “Yes.” And he said, “What kind of name is that?” And I said, “Well, it’s a name in Spanish. But my grandfather is from Palermo. I’m 1/4 Sicilian.” And he goes “Oh” and he gives me a big hug and says, “Too bad it’s not half.” Because if you’re a half Sicilian, that’s obviously better than being 1/4 Sicilian. So we went to court and finally we won. He appealed it. We won. He appealed it. And then he went to jail and he died. And, no, because he was ill, he didn’t go to jail, he got convicted and went on house arrest. He ultimately got sick and he passed away.
Andrew: All right, I want to get into the heart of this story of how you built up this company. But, first of all, did I get my facts wrong already? I thought 1982 is when you started the company, you’re saying 1980.
Dan: Yes. No, no, no, no. If I said ’80, I misspoke. ’82, I’m sorry.
Andrew: OK. All right, so before then…
Dan: Excuse me, I normally say early 80s but you’re precise, it’s ’82.
Andrew: OK. And before then, you went to the Army and you told Jeremy, our producer, that they made a man out of you and you told him that they made a man out of you by doing what? Can you tell the audience?
Dan: Yeah, well in those days, I volunteered for the draft in June of 1966. I was 20-years-old at the height of the Vietnam War. I went in as kind of a screw-up, college kid that wasn’t getting good grades. I was essentially flunking out of school. And I went in as a private in a fort over in California which is up near Monterey. And I was there, I think, 16-weeks through basic and infantry training and advanced infantry training. And I decided that I was going to try to go to OCS; Officer’s Candidate School. And so I signed up, and as fast as they were killing Lieutenants, you’d have thought I didn’t have to wait 6 months. But I had to wait 6 months to get into OCS and I was accepted. And I started OCS in December 1966 and I graduated on July the 1st of ’67 as a Second Lieutenant. And it made a man out of me. I was responsible for other people. I was ostensibly responsible for their lives, in peace time and in war time. It’s the first time I really had any responsibility, although I’d been working since I was 16, [??] jobs. It was the first time that I actually got a regular paycheck every month and a paycheck for second lieutenant in 1967 was $302 a month. A private in the Army in 1967 made $68 a month. It was a 400 or 500 percent pay increase. I thought it was pretty good.
Andrew: You thought it was pretty good, but did you, at the time, even say, “I want to be a millionaire one day. I want to earn big money and be worth?”
Andrew: No. You didn’t? This was just where you were?
Dan: It came later. Graduated class of OCS, 107 people, 100 went to Vietnam. I was not one of the ones that went to Vietnam. By some stroke of the Army, government, they sent seven single guys to [??], Europe where we basically [??] and fornicated our life away for some two and a half years.
Andrew: You had two and a half years of sex in Europe?
Dan: And alcohol. [??] I had responsibilities, but it was a lot better than dodging bullets in Vietnam. I saw and I was around senior officers, and I was around ambassadors, and I saw that there was a way of life that I hadn’t experienced, and it was a more cultured way of life, and that culture costs money. I had, as a second lieutenant, I had a car and a driver because I became a company commander of a security company when I was there. We saw that the only thing that differentiates, other than [??] is money, and how could I make money? As the Vietnam War wore down, I decided initially I was going to be a career [??] officer, but I decided to [??] out. [??] back to school because I got such bad grades I had to repeat the first two years of my college education by taking the courses over again because Ds and Fs don’t count. I ultimately finished four years of college [??] two and a half years and I graduated on [??] Dean’s list. [??] often ask me, ‘Why weren’t you a magna cum laude, summa cum laude or valedictorian? Because an A and an F still makes a C. An A and a D makes a C+. The fact that I graduated on the Dean’s list meant that I was getting 3.5 or above semester by semester, but [??] making up for all the bad grades that I got when I first started college. I took as much as 26 units in a semester. The normal load is 12 to 15 and I took [??] two different schools at the same time and I took 15 to 18 units over summer school. Over summer school you’re only supposed to take six or eight. And I worked and I was graduate assistant [??].
Andrew: By the way, I can see the sun move. I notice that it’s moving as we talk because it’s coming in more from the window. Can you tilt the camera away from the window? The brighter it is behind you, the darker Skype makes [??].
Dan: [??] on here.
Andrew: There you go. That way. Now it brightened up so much. Let’s see if we can get you in the shot. The story I was fishing for was how they attached batteries to your testicles. Is that inappropriate to bring up in an actual interview?
Dan: [??] for me. That’s an OCS. [??] to OCS [??]. Back in those days, in the ’60s, they could beat you, kick you, spit on you, call you bad names. They could do everything. Now they can’t do that because it’s not politically correct. Even the SEAL team [SP], training now, you go home on the weekends, for SEAL team training, if you’re married. SEAL team training [??] tough. So when we were going through OCS, and this was part of the ranger training through OCS, when you were doing escape and evasion, if they captured you, they did a number of things one of which is they pin you over an ant hill and pour honey on you, leave you for two or three days. Or they hung you from a tree by your thumbs and they put battery wires to your testicles.
Andrew: This is Americans doing it to Americans?
Dan: These are guys that just came back from Vietnam that are training [??]. This is what’s going to happen to you if you get caught.
Andrew: Let me get into the business of it because I’ve got an audience here, thousands of entrepreneurs who are dying to learn how to build successful businesses and do it by hearing how you did yours. Here’s what I’m wondering, how do you even get into this business? I understand how to start a software company. You just turn on your computer, you learn how to program or you find someone who does and you start you know creating a minimum bible product and you build it up from there. But to get into energy, I have no clue. So how do you get into energy? And then we’ll talk about how you started this business specifically.
Dan: Well, it’s the same advice I give to the kids now. When I started the company, I was the CEO of two other energy companies and a conglomerate before I founded my own company.
Andrew: So you rose up in the ranks working for those other companies and became the head of the company?
Dan: No, no, no. I was with Bear Sterns and I went to work for one of our corporate finance clients. He made me CEO of one of the subsidiaries and when in a couple of years I was CEO of (?) and then in one case I had diversified us into other products, including I was in the movie business, the real estate, insurance etc.
Andrew: Why did he make you CEO of his company? If you’re working at Bear Stearns, how does one of the Bear Stearns’ clients say you know what this guy Dan he’s going some place, I am going to ask him to be CEO of my subsidiary.
Dan: It could have been, I had advised him for a few years prior to that while he was a client at Bear Stearns and we had done a lot of smart things and even though he was a very great salesman, he was a shitty operations guy. His leadership skills weren’t too great. My leadership skills (?) subsequently getting out of OCS in the military. I spent three and a half years active duty and I spent three and a half years in the reserve. My leadership skills for a 25-year old guy, 26-27 year old guy were extraordinary. I mean even today the biggest thing that I see, the flaw in young (?) is they have next to no leadership skills. Their management skills are OK. OK. I’m not saying they’re good. They’re OK. But if you don’t have some sort of leadership skills to back up your management skills, employees don’t do what you tell them to do, they do what they see you do. Many of the young managers nowadays, those that are unfortunately listening to this, they want you to come to work at 7 o’clock and they roll in at 11:30 from the gym.
Andrew: I see.
Dan: You know, they want you to stay till 9 or 10 o’clock and they go home at 6:30 or they go to the bars at 6:30. That doesn’t work.
Andrew: So it’s about having strong self-discipline and if you have strong self-discipline then everyone around you understands that they need to be just as committed, just as rigorous about their discipline.
Dan: Discipline, commitment are only a small portion of the leadership skills that I’m talking about. It’s laser beam focused. You know Clausewitz about 250 years ago, the famous Prussian general said successful people focus on the few not the many. He meant few battles. You pick your battles and you win them one at a time. Most of the entrepreneurs, yourself probably included, do too many things. You’ve probably got 4, 5, 6 businesses that you try to juggle in the air.
Andrew: I’m really focused on just this, but even within Mixergy I do find myself getting distracted. As much as I try to say no to new ideas and new projects, I do find myself saying yes.
Andrew: But you were telling us that you were CEO of one company and then another, and then another, and then another. So it seems like you also were doing a lot of different things at once.
Dan: No, no. The first company I grew from scratch was 3 million dollars. The second company I grew from scratch was 50 million dollars. The third company I grew from scratch was 450 million dollars.
Andrew: So how do you go to 3 million dollars? What’s the business like?
Dan: We had an idea, an inception of an idea and it was real estate related, and this was back in the late 70s and it was based on sales. The more sales that you made, obviously the more revenue that you made. We included like-minded people like myself that had just gotten out of the military. In this particular case, I hired 13 top gun pilots to sell real estate with me and they didn’t know that you couldn’t sell real estate in the recession of the late 70s. They didn’t know that the 20 or 22% interest rates kept you from selling real estate. They only knew about dodging bullets in the jet plane over Saigon.
Andrew: So they started selling real estate for you and that’s where you made the first million.
Dan: No that was the first company, three million. That’s when I was still in graduate school. [??] then went to Bear Stearns. A few years later the second company. I was asked to leave Bear Stearns and [??] work for one of our corporate [??] clients. He made me CEO of one of their subsidiaries. He had a whole umbrella of companies and he saw how successful I was in the umbrella and then he made me CEO of, in fact, we formed [??] JP Candistries [SP], which [??] and a new company, which I became CEO of [??].
Andrew: The first company that got to three million in real estate, that’s the value of what? That’s not how much money you took out of the company, right? Is it annual sale, no?
Dan: No. [??]. The value of the company at the time. It was taken [??]. I had very [??] equity in that company.
Andrew: Small equity.
Dan: I was [??], small equity. I was the principal behind it. I was the driving force. If you were here, I could take you down the hall. I still have, it’s a couple of things. [??] my door there’s a hatchet that I was given because I still, I’m the clean up guy. I’m the clean up [??]. When you’ve got a problem, you come to me and I get it fixed. There’s a hatchet over my desk called The Hatchet Man from 1977 where I used to go in [??] four [??] Bear Stearns and clean stuff up. When they got into deals they wanted out of, they had to fire their son, they had to fire their mother, whatever, I was the guy that cleaned it up. Down the hall further there is a plaque that when, as a salesman for the real estate company, I had a 94.6 percent [??]. I sold 94.6 percent of everybody that I made a presentation to. I used to cry about the 5.4 percent of the guys that got away from me. I was told by my sales manager at the time, a guy named Kelly Norwood, I still remember his name. He said, ‘[??], a young guy like you ought to sell every [??] sum-bitch that walks through the door.’ My expectations were high. I thought I could sell every sum-bitch that walked through the door. I did almost [??] every sum-bitch that walked through the door.
Getting back to how do these young entrepreneurs, most young entrepreneurs, their expectations aren’t high enough. They listen to their parents. They listen to their friends. They don’t hang around with anybody that’s ever made $100 million, $500 million. The next question is, ‘How do I hang around with people that made [??]?’ We’ll get to that. They [??] believe. We have two kids from New York City [??] the seminar, they get here Sunday. One man, one [??]. Both in their late ’20s, 29 and 30. One was picked, I believe, the 30 Kids under 30 Years Old by Time Magazine to be [??]. Going to crush the world. One went to NYU Stearns School [??] Columbia Graduate School and one went to [??] yada and yada. They’re killers, supposedly. [??]. They’re going to come here and they don’t know shit. I already know that, but under 30 they [??]. Everybody kisses their ass. Everybody tells them how smart they are. Not just because they went to all those fancy schools, which I didn’t go to, but because Obama said, one of the [??] magazines said.
Andrew: So you want to kick their butts and show them how much more they need to know?
Dan: They’re coming to me. I don’t want them to be here. They’re paying the money though. I don’t want them to be here, but they know they’re not as good as everybody tells them that they are. We’ve had emails and back and forth enough for them to ascertain, I’ve given them three or four ideas. Falling asleep with a half a bottle of gin in me, this is an exaggeration, I’ve lost more brain cells than they have in the drinks I’m going to have tonight. You too.
Andrew: I see what you’re saying. These guys are paying you to show up at your castle and to talk to you and learn from you.
Dan: And get a beating.
Andrew: And to get a beating.
Dan: Get a beating.
Andrew: Where did the idea come from for Great Western Resources, Inc.?
Dan: It’s [??] story I told your colleague. New Year’s Eve, 1982. Maybe, 83. A friend of mine named Jack, a very wealthy guy in Texas, called me up and said, “Dan, I need a favor. I need to sell this asset before the end of the tax year otherwise it’s going to be taxable [???] my income and yada yada.” So I said, “Sure, Jack, what is it?” He told me what it was. I said, “OK, I’ll buy it. We’ll have the lawyers work on it tomorrow but I’ll send you a fax right now, this is what I’ll pay you,” etc. So about 6-8 weeks later, I fly to London with one of my lawyers and we go to look at the assets we bought. The assets we bought, there was more money in the bank than I paid for the company…OK.
Andrew: So how did you end with a company that…why did they sell this company if there were more assets in it than what they were selling it for?
Dan: Because the tax liability was going to be 6, 7, 8, 10 times that.
Andrew: I see.
Dan: Because it was going to be scooped into his worldwide assets and he didn’t need that. OK. So and people say, “Well, how is it that you found a company like that? Over New Year’s Eve, somebody calls you and says I want to give you, essentially, a few million bucks?” If I hadn’t been hanging around, and you are, and your career is going to be based on who you hang around with. Who do you play squash with? Who do you play golf with? Who do you play tennis with? Who do you go have a drink with? In some cases now, who did you go to school with? Etc. Well, I’ve always tried to be around people that were much more successful than I am. Now that’s pretty tough for me to do now but it wasn’t so tough when I was in my 30s; 20s and 30s. So, I mean, nobody, I don’t mean to be rude, but nobody is going to call you and say, “I want you to buy this company for 3-million and it’s got 8- million in the bank.”
Dan: No, it isn’t going to happen. And nobody is probably listening.
Andrew: And you saying they did this because they’re friends of yours? The guy who sold it to you.
Dan: [???] Jack liked me. He may have thought I was the son he didn’t have. I don’t know. But because a lot of success is about positioning. I’d rather be lucky than smart. And, sometimes, serendipity gives you an opportunity.
Andrew: But these are millions of dollars at a time when millions were worth a lot. When it was hard to come by money like that. Wouldn’t he say…
Dan: If I remember correctly, his tax liability was 31-million dollars so he didn’t care.
Andrew: I see. OK. Alright, so then he comes to you with this business opportunity, you jump in…
Dan: OK, stop. [???] I’m in London and we’re visiting our assets to go up to the Hilton Hotel on Hyde [SP] Park. And I pick up a newspaper, The Evening Standard, they give them away. I pick up a newspaper, I’m sitting at the bar and I’m opening it up and I see a company went public. An energy company so I’m obviously interested in it. In the UK, you have to print your balance sheet and your income statement before you go public. And if anybody has any complaints about it, then you have to write in and you have to stop the public offering. So I’m looking at the assets and I turn to my lawyer and I say, “Mark [SP], we can do this.”
Andrew: You say this little picture of a company just went public with so little background information, with so little money on their balance sheet, we could do it too. And that’s what inspired you to take your company public; this new one that you bought?
Dan: Then we went back to the same investment banker, the same law firm, the same accounting firm that did this package and it’s called Petronall [SP] was the name of the company, Petronall, the same package and I said, “What do you need from me in the next 30 days to do the same thing you did for these guys?”
Andrew: I see.
Dan: And basically he said, “You need two million barrels of reserves.” Two million barrels of reserves. So I went back and I put down a $60,000 option on two million barrels of reserves. $60,000 option and three and a half months later we were public and it was the first time anybody had taken an option public in London.
Andrew: So basically you didn’t have the two million barrels, you had an option to buy the two million barrels and you were going public, not with this asset but, with the option, the opportunity to buy that asset.
Dan: And it was a simultaneous transaction; as they gave me the money from the public offering, I gave them the money for the oil barrels in the ground.
Andrew: I see. Right. Because as soon as you got that money, you had the option to go buy the oil. Boom, you bought it and everything was kosher.
Dan: Nobody had ever taken an option public before and then about 200 companies followed me after that. And then I liked it so much, I did it in Amsterdam as well in the Amsterdam stock exchange. Then they changed the laws in Europe and you can’t do it any place now. But, you have to react. Most of the kids now don’t react quick enough. Their reaction time is way, way too slow. They are afraid of making mistakes. You know, if you played any sports, it is all right to strike out, it is all right to drop the ball. You have to learn by doing things not in a good way. Well, kids do not believe that.
Andrew: You told Jeremy that you made tons of mistakes and everyone focuses on the successes. Give me the most painful mistake you ever made.
Dan: The most painful was when we had a patent that was for a product that competed with Kevlar. Kevlar is the stuff that they make space suits out of and the Pope’s uniforms made out of it, Kevlar.
Dan: It is bulletproof. I spent 13 years and $400,500,000 of my own money to try to compete with DuPont who has Kevlar. It is estimated that DuPont spent between $150,000,000 and $250,000,000 keeping me out of the market and I did not think that was possible that they would. I got a big Japanese stock company to partner-up with, it did the research and development. To make a long story short, that was a painful 13 years.
Andrew: What did we take away from that, that you do not compete against and enemy who can crush you?
Andrew: No. What do you take from that?
Dan: No, you have to know when to fold.
Andrew: You should have folded earlier. When you saw you were not going to win you should have just accepted it and moved on.
Dan: Correct. I should have walked away after three or four years instead of 13 years.
Andrew: By the way, I said at the top of the interview that you turned $820 into a company worth $450,000,000. We are seeing how you got the company that was eventually worth $450,000,000. Where is the $820, what does that mean? I kind of used it because I wanted a hook for this interview, but I do not understand, where is the $820, is that how much money it had to be?
Dan: I incorporated Great Western with $1000. I put up $820, a junior partner put up $180. The junior partner, a person named Bob Anderson, used to be Secretary of the Navy for Franklin Delano Roosevelt.
Andrew: I see.
Dan: I was doing all of the work, I met at his home in Dallas and he says “Dan, I am going to give you my stock back because I have to spend time with my wife, she is not well”, etcetera. I paid him $180 and that is how it started with $820.
Andrew: That was the company you bought that Jack introduced you to.
Andrew: I see, through that company. All right, and you are building this up. I have an article here from 1988 from the Sun Telegraph that talks about all of the different assets that you have such as a coal mining operation that you bought in 1986 and you build, you build, you build. Here is how the article ends. It says that your vision is to take this business to one billion or two billion dollars.
Dan: Two billion.
Andrew: Actually here it is, ‘In five years time, I expect Great Western to have assets of two billion to three billion dollars in revenue of $700,000,000 to $800,000,000’.
Dan: That is right, I think I remember the interview, yes.
Andrew: That was the vision that you had for yourself and the company at its height when you were pushed out, was worth $450,000,000. Did you feel at the end of that like a failure or did you feel like you should have never said publically that was your big goal, because people will then always measure you against that?
Dan: Just the opposite. When asked, I set my goals too low.
Andrew: Why should you have said more than two billion to three billion if you did not make that?
Dan: Because it probably would have been worth a billion. If I had said it was going to be worth seven billion, I probably would have gotten to a billion.
Andrew: Tell me the reasoning behind that. This is something that you said that you had noticed Ted Turner took away as a lesson from him his father. Explain that attitude.
Dan: Ted Turner got three things from his dad when his father passed away and he left him a small advertising billboard company. He left him a two million dollar billboard company, one, and I heard that from Ted’s own lips to my ears at the Harvard club in New York City, this story. We were both on the dais that day. The second thing that he left him was “Early to bed, early to rise, and always advertise”. His dad gave that motto to him. However, the third thing and the thing that changed my life and this was in 1993 that I heard Ted say this, his father, Ted Sr. telling Ted Jr., “Son, set goals that you will not accomplish in your lifetime”. Do not set safe wussy-pussy goals of such as I am going to do this and that. That changed my life. Then I realized looking back in retrospect, that I didn’t set high enough goals. I mean, nobody feels sorry for me because the company only got to 450 million. I also, had 2 other goals when I said that. They didn’t put it any [??] I don’t believe. Number one, I said I wanted to be in the top 5 INC. earners, oral executives in the world, and that I wanted to have 50th largest firm, scratch that, 50th largest energy company in the United States. Not the world, in the United States. That company, when I made that comment, was George Bush Senior’s oil company. It was the 50th largest energy company…
Andrew: George Bush…
Andrew: …George Bush Senior’s oil company was the 50th largest oil company at the time.
Dan: …[??] said that OK. And, we got to the 49th largest company in the United States, and I was 5 years and 3 of the 5 years, I was the highest paid energy executive. But, I was in the top 5 all 5 years. But, I didn’t get to the 2 billion, I only got the 450 million and then, the shareholders threw me out. The shareholders threw me out because Saddam Hussein invaded Kuwait in August of 1990. The Kuwait Government owned 30% of the company. Everybody though the Kuwait’s were going to have to sell assets to pay for the war. Our stock price went down. Then, when America stepped into save Kuwait they said, well, Kuwait’s going to have to sell off assets to pay for the rebuilding of Kuwait. The stock went down. So, the stock went down 85% under my watch and the Kuwaities, who owned 30%, and the other shareholders, the Bank of England, the Church of England, Fidelity, Prudential, to all of these shows, we’ve got to chop somebodies head off. So, they told me I had to leave on January the 10th 1992.
Andrew: How much were you able to take from the company? Not take from the company. What was your net worth after leaving the company?
Dan: That’s not public record. All my stuff’s in trusts, irrevocable trusts, so it’s not a matter of my net worth and it hasn’t been for 25, 30 years. I’m not a trustee, I’m not a director of my trust so it’s not for me to tell you how much my trusts have. But, what I can tell you, were when we went public and I had 60,000 dollars, 50 million pounds, which is about 100 million bucks, that was 80% my money. At ab-juncture, and then you put it all in …
Andrew: 80% of what?
Dan: 80% because I owned 80% of the public shares.
Andrew: When you took it public?
Dan: When I took it public, correct.
Dan: So, 80% of that 100 million dollars was my money. Just in stock, not counting whatever else I had, which I had a bunch of other stuff.
Andrew: Was it over 10 million dollars at that point?
Dan: Oh, yeah. Absolutely.
Andrew: Well over that?
Dan: I mean, on one day I added 50 million dollars to my net worth in one hour.
Dan: The day it went public.
Andrew: The day it went public, right, right. Your pushed out, you, let me see what happens. They sue you or you sue them? Planning come back [??]
Dan: They weren’t going to honor my employment contract.
Andrew: OK. They wanted you to pay an obligation to repay 1.3 million dollars in company loans, and you said no way. They weren’t supposed to get 1.3 million dollars unless you were with the company for the life of your contract with them.
Andrew: And, you won?
Dan: Correct. And, I won a 4.6 million dollar judgment, if I remember correctly.
Andrew: So, what’s the best thing, I want to get back to business, but let’s take a step away from business and talk about what’s, about some of the fun parts of life of having built this business. What’s the best thing that you did for yourself, beyond buying the castle, now that you are able to do just about anything at this point in your life?
Dan: The best things that money and wealth has given me, is the ability to influence people that I wouldn’t have the opportunity to influence, even before I started coaching and mentoring. Because, people, and I’m not saying this is right this is just life, people listen to you when you have money. Donald Trump is a classic example. People listen to Donald. I’m not saying they shouldn’t listen to him and I’m not saying they should. He’s a very smart guy. And, you know, they focus on his successes but he’s had a lot of failures, just like I have. You know, he’s taken companies bankrupt and etc., I mean. But he’s a visionary in his field. He’s a smart guy. So, he influences. I mean people that are running for President go to see him. So, when you have money and you have wealth, you have more influence. Now I’ve used it the last 20 years to influence younger people, not always young but, I mean, younger in experience to me, younger people that want to get more value out of their life. That transitions into being able to perform at a higher level for your family. And it gives you the ability to send your kids to the schools that they can get into, like my daughter just started North Western for grad school.
Andrew: You’re saying, because you’ve made money, because you have this career behind you and because you’ve made money, younger people are more willing to listen to you, to take your advice to live their lives based on your direction?
Dan: Correct. And when they come here, they’re in awe because this 15th- century storybook place of mine is pretty awe-inspiring.
Andrew: Why did you buy a castle?
Dan: I was running down Hawthorne Boulevard in Torrance in 1983 and I just looked at a RoTAP [SP] report that had just come out, one of the first issues, and I was running with my wife and I said, “You know, honey, I think to raise our children…” at that time we had 2 kids, no we had 1, she was pregnant with our second, that “I want to buy a big castle on an island.” Now, arguably we’re on an island here but this isn’t the kind of island I had thought of. I thought we were going to be on a little island. And I started looking that Thanksgiving. Five months later we went to the UK and we started looking in Ireland and here and this was the 13th big estate we looked at. This one. And I bought it eight months later. And I fancied the idea of my kids going to proper, posh English schools, etc. The type of education I certainly didn’t get. And I fancied the idea of them growing up with a sophisticated life that I didn’t have. And I tried to give them as much as I possibly could. Now that’s had some drawbacks because, being rich kids isn’t always good. But they’ve settled in pretty well and they’re all grown adults and they’re doing pretty well with their lives.
Andrew: You said, “sophisticated life that” you “didn’t have.” You certainly, at times in your life, were eccentric, non-politically correct. In fact, you told Jeremy, our producer, about the time you fired somebody over the phone. What happened when you did that? You actually called this person up who worked for you for how long?
Dan: He said that, “You can’t fire me.”
Dan: And I said, “I’ll meet you tomorrow morning at LAX.” So I got on a plane and flew to Los Angeles. In the Delta Crown Room, where you go for frequent flyer miles, and I went there and I ran across the room and I jumped on him and started choking him. And I said, “I’ll show you I can’t fire you. Who can be fired.” And security came in and took me away.
Andrew: Physically choked him?
Dan: Yeah. Correct.
Andrew: Until security came and took you away? You know what? I can’t figure this duality of your personality; on the one hand, you’re a cerebral guy who wants to influence younger people and wants to give your kids the good life and are living in a castle. And on the other hand, you fly to someone to choke him just because he told you that you can’t fire him over the phone. Help me understand this.
Dan: Well, first of all, I’m from East Los Angeles originally; the barrio. There are not many cerebral persons there, other than drug dealers, that haven’t taken any drugs.
Andrew: I see.
Dan: And, unlike most societies and well-educated persons, perhaps yourself included, you know, I’m going to tell you this and I’m going to tell you that. Where I come from, you don’t tell them, you show them. Remember I said earlier, in leadership, it’s not what you tell people to do, it’s what they see you do? Now this guy had done something very bad to the company; cost us a lot of money. And I was well within the rights of firing him. But he obviously thought that I was more politically correct, he thought I was too old, he’s past it. He actually thought he was going to stay with the business. So I wanted to send a message out to all the employees.
Andrew: Don’t f*** with me. That was the message that got out.
Dan: When I say you’re f***ing fired, you’re f***ing fired. That’s not the only time I ever choked anybody, but there are people out there that play hard ball.
Andrew: When else did you choke someone? Actually, let me ask you this. Since we’re talking about choking and being this open, there are certain things that we’re supposed to say as entrepreneurs – it’s the right way to build a business. It’s the kind of stuff you see in business books – be nice to everyone and so on. And then, there are certain things that you really have to do to build a successful business. What are some of those things that you really have to do that you’re not supposed to talk about?
Dan: Well, first of all, I don’t agree with the premise you just gave.
Dan: Yeah. No, I don’t. I don’t believe that. Steve Jobs, God rest his soul, was not nice to anybody. Bill Gates in the first 25 years was not nice to anybody. Donald Trump – and I have a lot of respect for him – is only nice when it’s good for him.
Andrew: And Barbara Quirk [SP] talked about – I don’t know if it was in this interview or it was in this book that I read in preparation for her interview here, about basically how he cheated her out of money and she pressed him and he had no choice but to pay what she was owed. That’s the kind of thing you’re not supposed to talk about publicly. That’s not in the art of entrepreneurship.
Dan: I talk about it.
Andrew: Yeah. Tell me what you did like that that you’re not supposed to talk about; who you squeezed that you weren’t supposed to squeeze; what we’re not supposed to teach in business schools and books.
Dan: No, no. Well, no, it’s not that I squeeze when I [?} it’s that most big guys squeeze and don’t expect to get squeezed back. See, I’ve always thought and still do it doesn’t take anything for me to step on a little guy or kick a little guy. That’s not nice, but to kick back a big guy that’s worth doing because maybe, then you’re going to prevent him from stepping on just one little guy. If somebody is stealing from one of my businesses right as we speak, I don’t really care. I do business in Third World countries that are really poverty stricken, and a dollar means something. They can live a day on a dollar. That’s fine. I’m not going to promote that they should steal, but I don’t take it as seriously as if somebody is a well known, successful businessman to steal $500 from me because he’s so used to stealing $500 from so many people. Arguably, some people say that’s how he got to be successful stealing bits of money from people. I have a lot of things…
Andrew: Do you agree with that?
Dan: No, not at all.
Andrew: No. You don’t agree that that’s the way to do it?
Dan: No, no. The way to do it is you have to find something and do it different. If you can’t do it different, you’ve got to do it better. My goal in life is always… Most of the new ideas have already been thought of.
Andrew: It’s also finding the angles. You found an angle when you said, “Huh, I can go public if I have this many assets, if I have this much oil. I know how I can get that much oil, and you found an angle and you worked it. Did you have other angles like that that you found?
Andrew: What else?
Dan: The first year I was in business I did $50 million in business with one employee, myself. I had a leased fax machine and a phone in the spare bedroom of my house. I did some research and found out that the refining business, refineries, were only operating at a 40% capacity and that they needed more oil, but nobody wanted to do business with the government, the Defense Fuel Center, the DFC, because there was so much paperwork. You had three feet of paperwork. This was when everything was paper. You had three, four, five feet of paperwork, and nobody wanted to do it. So I went out and found a way to bid on oil contracts directly from the government – jet fuel, to be exact – and to fill empty refineries. But we’d tell the refineries that you don’t have to do the paperwork, I”ll do the paperwork and I’ll be the middle man and I’ll take the one or two or three cents a gallon in between spread. I’ll buy it for $1.01 and I’ll sell it for $1.03 or there abouts.
The company was called Marion Refinery in Alabama. I liked Marion although there were other refineries that were more empty than his, but he was a retired one-star general who had gone to OCS in the same place I went to OCS. So, when I introduced myself, we were like lost brothers, like we hadn’t seen each other, even though he was considerably senior to me. The military has boded well for me. When I meet ex-military guys. So the military is good. I hadn’t really utilized my Hispanic, Chicano barrio because not that many guys when I was growing up had any money. Now there are, but in 1981 in Hispanic business, I was Man of the Year of Hispanic business, 1981. I brought this to talk about in case you asked me, but you haven’t, but I’m going to bring it up. I was the subject of a Pulitzer prize-winning article for the Los Angeles Times in 1983.
Andrew: What was the headline on that?
Andrew: What was the headline on that?
Dan: My picture’s on the front page of the L.A. Times, but the…”In Depth Examination of Southern California’s Growing Latino Community.” This isn’t the article, this is the Pulitzer prize. When you had a 50 million-dollar company in 1981, ’82, ’83, you were considered filthy rich. When I went to my 20-year high school reunion in August of ’83, and I walked through the door, I had just been on the cover of the L.A. Times. And they looked at me. And they didn’t know it was the same Dan Pena. And they said, “We thought you died in Vietnam.” I didn’t go to Vietnam, but I probably would have died if I had gone. I’m here. So to the extent that I used the angles, I’ve used my success in a pretty professional way. But you got to be successful first. I didn’t have a fa…my dad was a cop. LAPD Cop, you know he was a great guy, became a college professor at the end, his second career. But, so I had to make my success, you know my children lean more on my success, cause I didn’t have any success to lean on. My dad was an honest guy. I’m not saying that’s all he had, but that’s all he had, he’s an honest guy. He was a working guy. I don’t know if they still call them working stiffs, but he was a working stiff. He was a blue collar guy. And my mom was a housewife. Everybody’s got an angle. They’re either embarrassed about it. OK. When I wanted to raise money to go drill in Israel… Who did… Who would be the easiest person to go find oil in Israel?
Andrew: And what did you do?
Dan: My partner, Governor Hugh Carey was the former governor of New York. he set me up with big meetings. With all the rich Jewish people in New York City. And we raised 60 million bucks. We all have…
Andrew: When you met with Israeli officials, you took a Jew with you, you said, “I’m not a guy who can connect with them on that level…”
Andrew: “…but I know that that angle will work, so I’ll bring a Jew with me to talk to other Jews and…”
Dan: Correct, correct, correct.
Andrew: I see. And that’s what you mean we need to do.
Dan: That’s what I told the oil minister when he said, “Mr. Pena, Shell Oil was here, this was there, why do you think a little independent oil company like you can find this oil?” I said, “With the greatest respect, minister, you know the difference between chicken shit and chicken salad?” And he laughed, and he said, “Yes.” And I says, “You been dealing with the chicken shit, and I am the chicken salad.” And he told his underlings, he says, “This, this goyim, meaning non-Jew, uh has probably got enough hutzpah to find this oil.” And so I got the contract. We all have…
Andrew: There was no oil there, was there?
Dan: Nuh-uh. I been partners with the Kuwaitis, the Saudis, the Yemenites, and everybody else in my career. There’s a big joke because the Earth flapped over and there’s nothing. 100 meters away there is, but not there. And so the Arabs have a big laugh about it. Of course, the Jews don’t, but the Arabs do.
Andrew: Were you arrested by the Israelis at one point?
Dan: Because I wouldn’t wait. They kept me waiting in the Tel Aviv Hilton for ten days. They wanted to see… it was there form of a “doofus test.” Does he really want to do business with us or not? He’s not a Jew so they didn’t really trust me. And the highlight of my 10 days at the Tel Aviv Hilton is I met Mark Spitz, who I didn’t even know was Jewish at the time. But we sat and drank a few days. And I told them that I’m not going to wait any longer, because they said we couldn’t meet on Friday night because it was the Sabbath. I said, “Well, I’m leaving.” So I went to the airport. They arrested me at the airport. They brought me back. We met on the Sabbath. A lot of Hasidic Jews tell me I’m lying. It’s not a lie. I did meet and we signed a contract on the Sabbath.
Andrew: And all because you had the guts to walk away from them.
Dan: Correct. Most young kids don’t have the guts. No matter if you need it to breath, like air, you’ve got to be able to walk away. A young 30-, 35-, 40-year-old kid doesn’t know that. And that’s why I believe in building a dream team of senior people around you. I’ve been doing this 41 years now, and I’ve been f***ed in every orifice in my body.
Andrew: What’s the worst?
Dan: There’s too many. I have hundreds of worsts. Embezzlement from key employees. Fraud. Just recently, in the last year, I had to fire 116 people that consorted to commit fraud against me, from a general manager down to the lowest operator that picked up a phone.
Andrew: What company is this?
Dan: I don’t want to tell you that.
Andrew: Who is stealing from you? You said earlier someone is stealing from you right now. You said somebody out there is stealing from you.
Dan: Yeah, so?
Andrew: But you can’t get worked up about it?
Dan: Yeah, I don’t care. When I was young, I used to get worked up about it. But now?
Andrew: Before we started recording, I said, “How do I make this a win for you?” Often at that point, people say ,”You know what, Andrew, I’m raising another round. Maybe you can bring that up”. Or “I’ve got this new this new web site, maybe you can talk about that.” You said, “Andrew, I want to leave people with this message, that anybody can be successful.” The implication is that if you were successful, anybody can be successful. So where did you come from? You told us a little bit about East L.A., about the barrio. What was life like over there?
Dan: To give you an example, when I started coaching 20 years ago, we were going to do an infomercial. We were going to go to the Florida State Penitentiary. One of my best friends, who I went to school with, is serving a term of life for murder.
Andrew: This is a best friend of yours?
Dan: In high school.
Dan: We were going to have him behind the bars and say, “If Dan Pena can make all this money and be successful, anybody can. Because he should be Dan.”
Dan: Because I used to do a lot of crazy shit.
Andrew: For example?
Dan: My 50th reunion is coming up, and I just talked to somebody recently. They thought I died in Viet Nam. I don’t know why everybody thought I died in Viet Nam, but I didn’t die in Viet Nam obviously. At that time, 60 to 70 percent of all the infantry 2nd lieutenants that went to Viet Nam got killed. The life expectancy from a 2nd lieutenant platoon leader in combat for the first time was between one-and-a-half to six minutes.
Andrew: I’m going to come back to the military in a moment. But first, when you were a teenager, what was life like over there? It wasn’t gangland, was it?
Dan: No, I wasn’t in any gangs.
Andrew: You stayed away from it. What were you like as teenager?
Dan: I was a f***up. I graduated with a 2.5 average, a C+ average, in high school. My Dad didn’t have any goals for me other than to keep me alive until the age of reason.
Andrew: Keep you alive from what? What were you doing that could have killed you?
Dan: One, the neighborhood was [xx]. Two, my buddy who is serving life for murder. You know? Shit happens.
Andrew: I see. Someone who has the kind of temper that you…
Dan: There’s a picture I’ll send you a copy of. In 1993, I was going to do my first seminar in Los Angeles. I went back to where I used to live, and I took a picture of where I used to live in the barrio as a kid. There was a drive-by shooting there when I was there taking the picture. Then I went by the grammar school I used to go, Broadous Street School. Which I got expelled from three times before I was in the fifth grade. One time for breaking a kid’s arm on purpose. One time for smashing a kid’s glasses in his eyes on purpose. And one time for dropping an aquarium from the second floor onto my teacher’s head. He was on the ground floor.
Andrew: So you’ve been arrested for each one of those?
Dan: Correct. Correct. That was before I was 10 years old.
Andrew: I can see why they were worried. I can see why if you can go from there to living in a castle, then maybe the rest of us have an easier path. Here’s the thing that I wanted to come back to about the military. This is an inappropriate question for me to ask you, so it’s okay for you to say no. But what was sex like in the military when you were in Europe? Who were you talking about? Is this hookers? Is this average women?
Dan: First of all, it was the beginning of the braless area when women went braless, feminist, and all of that stuff.
Dan: The German, the French, the Dutch, and the English. I was young and single and I mean they were crazy.
Andrew: They were carefree.
Andrew: So, you could just walk over to a woman in your American uniform, you can start a conversation with her even though you did not understand the language, you could just get by, interesting. Did that build- up your confidence more than being able to withstand basic training?
Dan: No, I had that confidence because of the military training.
Andrew: I see, and then you used it in Europe and in business.
Dan: About three or four years ago, I am in with some of my partners the Claridge’s Hotel, a very expensive hotel in London. We are sitting five of us and there is a table of four or five girls about 25 feet away, and the girls are looking at them and they are looking at them, I said I am getting ready to go to bed. As I go to bed, I walk over to the table and I sit down and I buy the girls a drink, I say, “Hey girls, my young partners got no balls but they really want to buy you a drink, so I am going to buy you this drink and then I am going to invite them over. Is that okay?” Then they say, “What about you old timer, aren’t you going to stay?” I said, “No, I’m not going to stay, honey. You are about 40 years too young. Maybe your mom, will you bring your mom?” I go upstairs and the guys come over. I still do that. I just did that on New Year’s Eve a year ago.
Andrew: How long have you been married?
Dan: Almost 15 years.
Andrew: 15 years. Before you got married, were you out there in your…
Dan: No, I am talking about when I was young.
Andrew: I see. No, but I am saying you are a guy 15, 20 years ago you had a castle at the time, right? You were single, what was it like there?
Dan: No, I was married 30 years with my first wife.
Andrew: I see. In between, was . . .
Dan: I was a faithful husband. I did not screw around. I got it all out of my system before I got married.
Andrew: I see. OK. I just feel like I would walk out of that place right away.
Dan: Just to correct, my current wife, I have known her for 15 years but we only recently married in the last couple of years.
Andrew: I see, OK.
Dan: What I mean is that guys do not even know how to buy a girl a drink.
Andrew: No, they are big wusses. In fact, I thought in Europe, I remember going to Europe and I thought that all of these guys are going to be so cool. I am going to have to sit quietly and watch them and I remember going into a club in Paris thinking all of these guys are going to start talking to women here and I am going to pick up on their vibe. No, guys would dance with each other and leave the women by themselves and if you had the ability to walk over and talk. Basically at clubs, is the only time they would talk English to you and not treat you like a jerk for talking English because no one else was speaking to them. That made me feel like a man.
Dan: That has not changed in 40 years. It was that way. You try to tell the young kids this. Jack Welsh says that the two biggest problems in business are lack of candor and lack of communication, and I agree with him. The reason we have a lack of communication and lack of candor is that we have a lack of balls. I have to say that Jack is a nice guy. I have met him and he is a very bright guy, arguably the best CEO in the last 100 years. However, it is a lack of balls and Jack has balls. One of the reasons he was so successful is because he did what he said he was going to do and he did it professionally. He is a great role model. What the kids need today is they need more mentors they need more role models.
Andrew: How do we get to that? You said earlier-on we will get to how do you hang around with someone who made $100,000,000, because you said that being surrounded by people who did inspiring things inspires you and helps you to get to do things that are equally inspiring, if not more. We said we would get back to it. We are there.
Andrew: What do you do?
Dan: OK. When I was young and a graduate student and building a real estate company I talk about, my then girlfriend who became my wife, we used to go to million dollar houses, a million dollar house in the early 70s was a big house, to see what they look like to get there. Therefore, it became in our comfort zone. We used to go to the International airport at LAX to watch people come off international flights from Frankford or Paris because in the early 70s you had to have money to take those flights. We went to Palm Springs and we stayed in a room that would be our whole monthly rent for one night. My wife would go to shops that we could not afford. It becomes within your comfort zone. We have kids that show up to this seminar here that have been successful. You know how when you buy a Ralph Lauren suit, it’s got a sticker on the lapel.
Andrew: They sew it in.
Dan: You’re supposed to take that off. We got people showing up here with the goddamn thing on.
Andrew: That is the stupidest thing I’ve seen. They just don’t understand how to wear a suit. They think you always have to have the label on.
Dan: Or the flaps in the back of the suit are still stitched together. You’re supposed to unstitch them. The pockets are still stitched together. They don’t have a fucking clue, but they made some money on the Internet and they want to spend 20 grand to come here and me give them a beating.
Andrew: Is that what it costs to get a beating from you? $20,000?
Dan: That’s what a week costs here.
Andrew: You don’t have a lighter beating, like a slap in the face? No. There’s no [??] for that.
Dan: I’m $3000 an hour if I’m just doing consulting. That’s been the same rate for 20 years. It’s 3000 euros an hour. I just changed it a few years ago. I have Siemens, the 20th largest company in the world, I work with for ten years. I helped the guy become CEO and I mentored him for ten years. I’ve got quite a [??] successful people that I can talk about. I can talk about [??]. Some of the people been successful I can’t talk about for non-disclosure reasons. It’s self-confidence. You build your self-esteem in the first seven or eight years of life. Who are you around the first seven or eight years of life? Who?
Dan: More particularly?
Andrew: Other kids.
Dan: Mom. So moms, I love you, and don’t feel bad about this, but you have self-esteem or you don’t have self-esteem based on your mom.
Andrew: [??] in his book said the reason he has self-esteem is because of his mom.
Dan: The reason I have self-esteem, my mother’s ashes . . .
Andrew: There it is.
Dan: There she is.
Andrew: There she is
Dan: I have self-esteem because of her. Even though I wasn’t a good student. I wasn’t a good athlete, I still felt good about myself. I’d be out in the outfield and I’d drop the ball and everybody’d be screaming at me. It’s not the end of the world because my mom would say, “Maybe you weren’t meant to play baseball.” She was right. “Maybe you weren’t meant to do this. Maybe you weren’t meant to do that.” She believed in destiny, but the kids today, most of the kids that come here, even the very successful ones, they need an attitude adjustment and they need to work on their self- esteem. When you’re 35, 45 years old, it’s tough to build self-esteem. I’d say it’s almost impossible.
Andrew: These guys are wealthy enough to come to see you, pay you $20,000 and they still don’t have self-esteem?
Dan: It’s, in my opinion, low.
Andrew: Maybe, it’s higher than their friends, but it’s not really high enough.
Dan: Bill Gates, young, didn’t have high self-esteem. You surround yourself with people with high self-esteem and then it rubs off. You go to million dollar houses, you go to Palm Springs for one night and you pay $405, and this was [??] years ago for one night, and you’re sitting at the bar and you meet a rich person, and my wife then, as my wife now, were both gorgeous, and she used to wear her little mini skirts in the early seventies and people would remember me because of my blonde wife with the little mini skirt. Now my current wife, my love of my life now, she looks like a movie star. People think she’s a movie star so people don’t know me unless we’re in a certain kind of business circle. I go to the Harvard [SP], Club they know me. [??] know anybody at Harvard.
Andrew: But anywhere else they’re paying attention to you because of the wife that you have with you.
Dan: That’s not why I married her, but that’s how [??]. The people don’t appreciate how important it is to work on your self-confidence. It’s like in athletics. The kid that just won the U.S. Open, Murray, he’s been a great tennis player for five years but now he’s got this self-confidence and this self-esteem. He got a new coach that was a winner, that beats him, and I’m not saying everyone has to be beaten, but everybody needs to have high goals set expectations very, very high because I don’t believe in, if I set my expectations too high for you then you’re going to fail and you’re going to feel bad. Well, I know that I can’t help everybody. I’m not a fifth grade teacher where I’m there to help everybody. I can help the people that have the most focus, and reasonable self-esteem and reasonable self-worth. Those people I can help.
Andrew: You said you wanted to get them to set goals that are too high to achieve, and to have balls or guts because women, What am I saying? I don’t want to be exclusive. I don’t want to exclude women. Guts not balls, fair to say?
Dan: Yeah, Well I mean some of the biggest balls I’ve ever seen are on women.
Dan: I mean some of the most successful proteges, mentee’s I have are women. Because they are single minded, they can multitask and they can focus. The average housewife can multitask better than the average manager in a company.
Andrew: Or have a female CEO.
Dan: Yeah, Correct.
Andrew: How do we come and can we, if I’m in Scotland, can I just pop into your castle and say hello? Can someone in my audience?
Dan: I’m not there that often. I’m only here two or three times a year because I live in the Philippines, I live in Southeast Asia, Shanghai and Hong Kong.
Andrew: Can we come and just visit even if you’re not there to get a sense of the place, to feel inspired?
Dan: Well, we’re a secure place. We have guards and electric, but the castle is open up a few times a year. Like yesterday, we had a thing here for save the children and that’s why Princess Anne, the royal Princess Anne, was here.
Andrew: I see.
Dan: So there was a thousand people here yesterday. Yesterday and the day before. It’s Guthrie Castle and it’s Guthrie, Scotland. We have our own little town at the gate. It’s three quarters of a mile from one gate to the other gate. That’s how wide the property is three quarters of a mile and we have our own private golf course, and it’s a pretty spectacular place. It’s easily Googled. The seminars I give a couple of times a year. This year I gave one in May and I give one next week in October. They are a week long and we have some pretty incredible people coming this time. We have more and more Internet gurus coming now because a lot of guys and gals have made money in the internet.
Andrew: By gurus you mean guys who teach how to build successful companies?
Dan: No, No.
Andrew: You mean, internet entrepreneurs. Software entrepreneurs.
Dan: Yeah entrepreneurs, but they think they are gurus.
Andrew: I see.
Dan: They think they are God’s gift. We have five or six of them coming. But we have four repeats. We have a woman who’s coming back for the third time. We have a guy who is coming back for the seventh time. We have another guy who’s coming back for the second time. He’s bringing his two brothers. We have another guy coming back for the second time who is bringing his brother, and was just here in May.
Andrew: How do people connect with you? At the end of this interview if they want to e-mail you, and say you know what I need my butt kicked. Or maybe they start off by saying thank you. If they want to connect with you to just say thanks for doing this interview, what’s a good way for people to do that?
Andrew: All right. Danpena@Guthriecastle.com. All right. Thank you for doing this interview. There’s so much more that I’d like to ask you. I hope I get to meet you in person, and we get to have a conversation.
Dan: Where are you based?
Andrew: I’m in D.C. today. I’ll be in San Francisco in a little bit.
Dan: No. No. Where do you live?
Andrew: Washington D.C. for a few more weeks, and then I will be in San Francisco.
Dan: Wow, so West Coast.
Andrew: Yeah. do you ever get out there anymore?
Dan: Yeah. Yeah, in fact, I’m going to be there at the end of this. I’ll be in Los Angeles. I have a very dear friend who is ill, and not going to be around that much longer, unfortunately.
Andrew: I’m sorry to hear that.
Dan: So, I’m going by to see him. I have a couple friends there. My children, one of my sons used to live there but now he lives in Arizona.
Andrew: Tell you what I’d do if you’re up for it in L.A. Maybe, not this trip. Get together a group of entrepreneurs to have dinner with you. To have a quiet conversation with you. To get to know you, and for you to get to know them. Just have them learn from you.
Dan: That would be great.
Andrew: All right so.
Dan: You know how to contact me.
Andrew: Yes. firstname.lastname@example.org
Dan: That’s a lot more doable than trying to get on here. Somebody may shoot them.
Andrew: I like how when I even suggested it I saw something in your eye. It was like, Oh no don’t you have people come to my castle. We have security.
Dan: We do. We do.
Andrew: I don’t want strangers from the Internet to [??].
Dan: I call them in a loving way and I say – The Internet scum now that are making a lot of money are quite incredible.
Dan: Even though they’re not Zuckerberg, it’s a lot easier to do a few million dollars in revenue today via the Internet than it is bricks and mortar someplace else and it just is. It’s a whole different life. So I have admiration for that. I have admiration for that, but one thing I hadn’t thought of. This is a closing thing, and if you had asked me this earlier I would have said it, but I hadn’t thought of about it.
Andrew: Yeah. Let’s close this.
Dan: OK. You don’t know this, but I’ve lose 70 pounds.
Andrew: No, I don’t. You look good in pictures, or maybe you found a way in those older pictures to…
Dan: I just didn’t allow people to take pictures when I didn’t look good.
Andrew: I see. OK.
Dan: I’m in great shape, but I lost 70 pounds. I was asked by some health people, “What’s your secret?” To make a long story short, we came up with a new concept, it’s called Dan’s Cheating Diet because when you’re my age and you’ve got money and you’ve got discretionary time, you don’t want to live like on Weight Watchers. And I don’t mean that against Weight Watchers, if you hear this, Weight Watchers. And so, we developer a program that’s going to come out over Christmas called DansCheatingDiet.com where I show through lifestyle for senior citizens, that have arthritis like I do, that can’t run anymore, that’s et cetera, et cetera and it’s going to come out. We’ve had a lot of positive interest. The test market has been overwhelming because there are a lot of people that are 55 and older in the United States. We’ve tested it in Florida, Arizona, Palm Springs and one other place I can’t think of now.
Andrew: I don’t think that’s going to excite the audience that we have here with us right now. I’ll tell you what?
Dan: Because they’re all young. I understand.
Andrew: Maybe, they should care about their weight, they don’t care. They now are so focused on one thing building their business that nothing else seems to matter, you remember that?
Dan: Sure, I do, but the thing is that if they think they’re focused, they should look up the definition of laser beam focused.
Andrew: I see. Yes. There’s being more focused.
Dan: Yeah, because if you’re doing anything other than your business, if you’re not sleeping under the desk like Bill Gates used to, and I did.
Andrew: Like you did. I didn’t even get to that story. Yes.
Dan: OK. If you need a vacation to recharge your batteries, you’re in the wrong business.
Andrew: [laughs] You should be like the Energizer bunny, never needing to stop, just keep on fricking going. That’s your mantra.
Andrew: That and [??].
Andrew: Dan, thank you for doing this interview.
Dan: Thank you. I enjoyed it very much. Good luck to you in your business.
Andrew: You bet, and thank you all for being a part of it. Bye, guys.
Walker Corporate Law – Scott Edward Walker is the lawyer entrepreneurs turn to when they want to raise money or sell their companies, but if you’re just getting started, his firm will help you launch properly. Watch this video to learn about him.
Grasshopper – Don’t make the mistake of comparing Grasshopper with other phone services. Check out their features and you’ll see why Grasshopper isn’t just a phone number, it’s the virtual phone system that entrepreneurs (like me) love.
Shopify – Remember the interview I did about how the founder of DODOCase sold about $1 mil worth of iPad cases in a few months? He used Shopify. It’s dead simple and very effective. To get a longer free trial, use this code: Mixergy