Richard Steel. Ex-Founder's 'Portfolio of Interests'
Episode - 6
Richard Steel. Ex-Founder's 'Portfolio of Interests'
My guest today is Richard Steel. Since he sold his business over 10 years ago, Richard embarked on a remarkable journey. He led a public company, authored a book, provided counsel to the White House, joined the Harvard Business School Alumni Board and established a philanthropic fund. His unique philosophy emphasizes the creation of what he calls a portfolio of interests.
What We Discussed:
00:00:00: Introduction and Background
00:01:08: Do you Regret Selling the Business?
00:02:49: Feelings After Selling the Company
00:06:11: Journey after selling his company
00:07:22: Reasons for starting his business
00:10:09: Motivations for success
00:11:00: Attitude towards money
00:13:05: Decision to sell his company and HBS experience
00:16:12: Involvement in HBS alumni association
00:17:36: Comparison of time in private vs. public company
00:20:36: Current venture capital firm and involvement in other companies
00:23:13: Other Activities in Richard's Portfolio of Interests
00:27:00: Principles of parenting
00:29:48: A Happy Marriage Post-Exit?
00:33:14: Involvement with the White House Business Council
00:38:08: Journey to becoming an author
00:40:10: How writing a book fits into overall strategy
00:41:09: Identification as an optimist
00:42:59: Life after business exit
00:43:47: Identity and life transitions
00:44:06: Arthur Brooks and transitioning careers and phases of life
00:45:18: Fluid intelligence vs. crystallized intelligence
00:48:15: Personal failures and regrets
00:49:55: Loneliness at the top
00:51:42: Post exit loneliness
00:53:07: Choosing whom to surround oneself with
00:54:00: Being an introvert
00:57:01: Staying fit and healthy
00:58:47: Health prioritization
00:59:28: What Keeps You Up at Night
01:00:07: Enjoying the little things in life
Richard Steel. Ex-Founder's 'Portfolio of Interests'
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Richard Steel: [00:00:00 - 00:00:22]
I got on a plane not knowing if the deal was going to close. Was on my laptop, on the phone and all this stuff, right? Anyway, the deal closed and I was looking at my bank account, hitting refresh, refresh, refresh to see if the wire transfer had gone through. And as we were taking off and sort of wheels up, I see the bank account balance change and I closed my laptop.
Anastasia Koroleva: [00:00:23 - 00:01:02]
Welcome to the Exit Paradox podcast. Here we meet remarkable exited founders to uncover what comes next. After selling a business. Did they sustain success and find fulfillment? Let's learn together.
Please subscribe to join our community.
My guest today is Richard Steel. Since he sold his business over ten years ago, Richard has embarked on a remarkable journey. He led a public company, authored a book, provided counsel to the White House, joined the Harvard Business School Alumni Board, and established the philanthropic Fund. His unique philosophy emphasizes the creation of what he calls a portfolio of interest.
Hi, Richard.
Richard Steel: [00:01:03 - 00:01:03]
Hi.
Anastasia Koroleva: [00:01:04 - 00:01:06]
Thank you so much for joining us today.
Richard Steel: [00:01:06 - 00:01:07]
My pleasure. Thanks for having me.
Anastasia Koroleva: [00:01:08 - 00:01:21]
So you successfully sold your business Steel Media almost ten years ago. That makes you a very experienced post exit founder and a perfect guest for this podcast. Do you ever regret selling your business?
Richard Steel: [00:01:24 - 00:02:49]
It was a good trade. There's a television show called Mad Men about Madison Avenue executives in the advertising world. And there's a scene when one of the junior staffers there, this woman named Peggy, says to her boss, Don Draper, she's sort of complaining about everything. And he looks at her and he sort of screams and he's like, that's what the money's for, right? Like, you're getting paid.
And so I don't regret it in that I think that had we not sold, it might have been a slow and gradual sort of grind into oblivion. Right? And so it extended the Runway for my company, for all of our employees, and for myself. Now, would I like to have the outcome two years later been much different? Sure, of course.
But you can't have your cake and eat it too, and have every single wish that you want. Now, there are things that I miss, I mean I miss the team and the interaction and figuring out difficult problems with intelligent people. That's some of my favorite things to do. And the people that I worked with, I could spend an hour talking about how phenomenal they are.
That's the only thing that I miss would be the interaction with those folks and sort of how we worked together as a team because we were really solid for such a long time.
Anastasia Koroleva: [00:02:49 - 00:02:58]
So if we go back to the moment when you just sold your company, how did it feel?
Richard Steel: [00:02:58 - 00:06:08]
If it was Friday and if the deal was going to close, sorry, it was a Thursday, and if the deal was going to close, I wanted to be in New York with all my employees. And I was actually in San Francisco at the time. And so I got on a plane, not knowing if the deal was going to close, and literally was on my laptop, sitting in the very back of the plane. It was the only seat that I could get last minute. And I was in the very back of the plane and on the phone and all this stuff, right?
Anyway, the deal closed, and I was looking at my bank account, hitting refresh, refresh, refresh, to see if the wire transfer had gone through. And I'm not joking, this is not an exaggeration. As we're taking off and sort of wheels up, I see the bank account balance change, and I close my laptop. Four and a half hours later, I land in New York. And the next day, and I didn't need to do this.
I could have wired the money. This is just something I wanted to do for myself. But I walked around with paper checks in the breast pocket of my suit, and I went downtown and saw our bankers, and I paid them in person with a check. And my banker, phenomenal guy named Sanjay Chadov, just a phenomenal banker in the mid market tech space, he gave me a bottle of champagne, which was great. Then I went uptown with the bottle of champagne in tow, and I went to my lawyer's office, and I paid them with a paper check, which they thought was odd, right?
Because everybody does everything by wires, of course. But for me, it was nice. It was having that actual moment, those sort of moments of closure. And then I went and dropped off the bottle of champagne at a restaurant that I was going to go to that night with another friend of mine, who was a great friend of mine, who was also my lawyer. And then I went to our headquarters.
So our company was headquartered in the Empire State Building. And I brought in all the employees, one by one, into the conference room, and I gave them bonus checks, like big fat checks. And that was very rewarding and very meaningful to me. I had actually paid the taxes on all of their bonuses as well. So the check they got was tax free.
So if you're getting a check for hundreds of thousands of dollars, it's nice if you don't have to pay taxes on it, especially when you're a 20 something or 30 something. And that was really moving and just incredible for me. I'll never forget that. That was a phenomenal day. And then I went to dinner with my friend, who was also a lawyer who was helping me on the deal the whole time.
We opened the bottle of champagne, I gave him his check. We had a great dinner. I mean, it couldn't have gone better. It was a lot of fun. So that was day one.
But your question was more, how do I feel afterwards? And I was elated, completely elated. It was transformational and wonderful. But then we had to get into the work of integration and integrating the two companies and the employees and things like that. We were a very buttoned up, suit and tie New York firm merging with a much more sort of low key, relaxed sort of culture Los Angeles firm.
Right? So we had to sort of navigate cultural fits as well as technology, management process, et cetera.
Anastasia Koroleva: [00:06:08 - 00:06:10]
So what happened next?
Richard Steel: [00:06:11 - 00:07:19]
Okay, so we went through the process of integration, and part of the exit was provisions that I was allowed to run the business as we had ran it in the past, which was fantastic. So I had control for a two year period over how things operated in our division. We delivered over 180% of EBITDA for the target for the first year. So we were doing incredibly well for the acquirer, which was great. There were about five different lines of business within the combined business at that time.
We were also preparing to go public as well. And so really having our heads down, focusing on EBITDA and our numbers, driving that so we could uplift to the Nasdaq was crucially important, which we did. So we went public the following year, which was a great experience for me and all my employees. And you're down there at the Nasdaq, and you ring the bell and your faces are on the billboards in Times Square, and all of our employees were there. That was a really phenomenal moment as well.
It was great.
Anastasia Koroleva: [00:07:20 - 00:07:21]
Can we then start from the beginning?
Richard Steel: [00:07:22 - 00:07:22]
True.
Anastasia Koroleva: [00:07:22 - 00:07:24]
Why did you start Steel Media?
Richard Steel: [00:07:26 - 00:08:31]
Well, I got fired from my job on my birthday, so I had a job in advertising, and I had negotiated with the owner of that business, probably a deal that was a little too good for me and not good enough for the company. And I was making a lot of money and doing very well at that job. But the founder of that business, I think, got a little bit resentful, and probably rightly so. I mean, I don't fault him. He was a very nice, very nice guy, very sweet guy.
And for the record, he didn't know it was my birthday on the day that he fired me. But it was a bright, sunshiny October morning, and I got a phone call saying, we're going to part ways. And I legitimately asked this guy at the time, I said, look, are you sure? Because I was representing probably 70% of the revenue for that business.
Anastasia Koroleva: [00:08:31 - 00:08:32]
Oh, wow.
Richard Steel: [00:08:32 - 00:08:51]
And so obviously I didn't want to lose my job at that point. But I also said to him, look, are you sure you want to fire me? Because you're going to have some trouble, anyway but yeah. So I got fired at that time, and that was the impetus for me to start my own business, and that's when I started Steel media, which is a digital advertising business.
Anastasia Koroleva: [00:08:51 - 00:08:57]
Well, you could have found another job, so there had to be some other motivation besides.
Richard Steel: [00:08:58 - 00:10:01]
I could have found another job. I talked to my dad this was prior to me getting fired, and he said at one point, you're working really hard for other people. You're making a lot of other people wealthy, implying that I wasn't doing it for myself and I could probably strike out on my own. And that registered with me at the time. And then once I got fired from that one job, I thought, you know what?
I might as well do this myself because I had my own clients and a good skill set. I understood that sort of digital was the way to go. The business was sort of an analog plus digital business, and I was really focused on the digital side. I thought, you know what? I could really make a go with this.
And I had nothing to lose. I wasn't married, didn't have kids, didn't have a mortgage. And a lot of people think it's very risky to start a business. It's a lot less risky when you have nothing to lose anyway. So I struck out on my own and turned out all right.
Anastasia Koroleva: [00:10:01 - 00:10:07]
So financial freedom, was it part of your motivation and generally money?
Richard Steel: [00:10:09 - 00:10:53]
I didn't come from money or any kind of wealth. We didn't have a lot when I was growing up, and I left home at 17 and never came back and paid my way through college and all that stuff. And I never really had a safety net. So for me, I think being very honest, it was fear and greed. Right.
I was fearful of not having enough and not having that safety net, and I was greedy in the sense that I wanted to create wealth for myself and I wanted to have freedom and security. So I think those were more the motivations. Plus, I needed to do something, and I needed to do something quick.
Anastasia Koroleva: [00:10:55 - 00:10:59]
How did this motivation change after you sold the company?
Richard Steel: [00:11:00 - 00:12:15]
Yeah. So I think that a lot of times you do things for money, right? It's sort of Maslow's hierarchy of needs. As soon as your basic needs are met, you have the luxury to start thinking about your other needs, wants and desires. And after I sold the business and was financially set, you have to ask yourself a really profound question, which is, what do you choose to do when you don't have to do anything?
And so my motivations became more external and less internal, right? I mean, when I was initially working, I was working for myself and to build wealth like we were talking about. And then I had employees, and employees with families and all the rest of it. So that burden was very heavy. But after that, after being sort of absolved of those responsibilities, the ability to choose the work, and whether that's volunteer work or other kinds of work, the ability to choose that work was very freeing.
So that's, I think, how it changed over time.
Anastasia Koroleva: [00:12:15 - 00:12:18]
So how do you think about money now?
Richard Steel: [00:12:20 - 00:12:59]
Yeah. So money is freedom. Wealth, it is important, right? I think there's a stigma in society about wealth and the wealthy and all that sort of stuff. But wealth is power.
Wealth is influence. Wealth is charity. Wealth is optionality. Wealth is freedom. Money is not money.
People don't sit around and bathe in a tub of dollar bills, right? It's a means to an end. And so for me, it's much more about freedom and choice than it is about fancy cars or things like that.
Anastasia Koroleva: [00:12:59 - 00:13:04]
When you were building Steel media, did you build it to sell it?
Richard Steel: [00:13:05 - 00:14:41]
Well, it wasn't intentional. It wasn't intentional until I had made that decision. In fact, I was in David Jaffe's class. So David Jaffe is HBS professor of strategy. We had him together as a professor at HBS, and I was in his class at the OPM program, the owner president management program.
And it was the first year of our two year journey at HBS. And he was talking about the race to the bottom in commodity businesses. And I was sitting in class and I said, oh my God, that's me. That's my business. This is a race to the bottom.
There were larger incumbents coming in. We were experiencing margin compression, all these classic things, right? And when you see it from an outside perspective in a classroom, and I remember my stomach sort of dropped and I got like a cold sweat. And I'm like, oh my God, this is my business, right? So I immediately went to his office hours, and he's got a beautiful office overlooking campus, nice sort of rounded windows in this corner office.
And I sat down at a table with him and I said, I sort of outlined what my experience was and what was happening, and he says, look, you need to either acquire technology for your business or you need to sell it. That was sort of the realization that we came to. He wasn't prescriptive about it, but that was obvious. And so from that moment on, that's when I started preparing the business for sale. And that was about a little over two year process.
Anastasia Koroleva: [00:14:41 - 00:14:45]
So it's all professor Joffe's fault, actually.
Richard Steel: [00:14:45 - 00:15:03]
I give him all the credit, and he's a very funny guy. Every time I see him, I say, look, thank God we had that meeting. And I made this monumental decision when I was sitting with you in your office and all the rest of it. And he always looks at me and he goes, where's my check? So, yeah, no, he's a great guy.
That was a pivotal decision.
Anastasia Koroleva: [00:15:03 - 00:15:19]
We did, as you mentioned, actually meet at the OPM program, at the HBS. But unlike me, you're still involved. You are on the alumni association board. How is that working for you, why you're doing that and what it gives you personally?
Richard Steel: [00:15:20 - 00:16:12]
Sure. So, HBS, as we just talked about, really changed my life in a lot of ways. I thoroughly enjoyed the time on campus. I love the physical campus, the georgian architecture. I thoroughly and completely enjoyed the friendships and the people that we both met during our time there.
The learnings were absolutely phenomenal. So I feel a debt of gratitude to the organization and to the institution. I feel the same way about New York City. I built my business largely in New York city, and, you know, there are certain things you can do in New York that you can't do anywhere else. Right?
Richard Steel: [00:16:12 - 00:17:30]
And so it's sort of an odd sensation to have a feeling of gratitude to an institution or a city or a place. But HBS was just a phenomenal and transformational experience for me. And to be able to be involved going forward on the board, on the alumni board, is fantastic. We're able to get updates about the school and budgeting and the priorities, and we meet with the Dean and we see what's happening on the physical campus and the new buildings that they're building, and digital transformation and tech and how they're answering the challenges that the new world of business is presenting on a daily basis. It's just fascinating.
It's being able to continue that connection with the school, meet a whole host of other former MBAs or OPM or folks from PLD or AMP, all these other programs. There's a gentleman named Dan O'Keefe, and he was the president of the alumni board up until last year. And when he was leaving he said a few words to the folks on the board, and he used the phrase mountains I was never meant to climb. And that really resonated with me. Right.
Because I felt like these are mountains I was never meant to climb. And I'm just so grateful and so blessed to be able to be a part of it.
Anastasia Koroleva: [00:17:30 - 00:17:34]
It sounds like this activity is very firmly in your portfolio of interest.
Richard Steel: [00:17:34 - 00:17:35]
Absolutely. 100%.
Anastasia Koroleva: [00:17:36 - 00:17:42]
Fantastic. So how would you compare your time in a private company and your time in the public company?
Richard Steel: [00:17:42 - 00:19:46]
When you're running a public company, you're spending a lot of time talking to analysts, and you're spending a lot of time filling out yours S ones and your ten Qs and all these SEC forms and things like that. So it's a different job. There's a lot more paperwork, regulation and process, which I think is obviously a good thing from a transparency perspective. But it's more conferences and analysts and talking your book and that sort of thing very intentionally, without saying anything that you shouldn't be saying, forward looking statements, et cetera. And it's interesting because I hadn't had several experience, but one stands out where I was at a conference and there was an analyst, and we were having beers, and he's buying me drink after drink, and I noticed he's asking me the same question in ten different ways, and he's trying to get me to give him some sort of piece of information that he could leverage.
Right. So I sort of politely excuse myself, but it was startling. And maybe I'm naive, but I was surprised that that was so rampant because it's obviously so forbidden, right, for them to do something like this. But of course, I'm sure. Happens all the times, and as I've witnessed, happens all the time.
Anyway, huge difference between running a public company and running a private company. And sitting on the board of a public company is a very weighty responsibility. At least that's how I approached it. And there are consequences, right, to your actions as a public company director? I'll stop there, but, yeah, a wholly different job than running a private company.
Anastasia Koroleva: [00:19:46 - 00:19:49]
But you don't regret doing it?
Richard Steel: [00:19:49 - 00:20:04]
It was a phenomenal experience, right? I mean, it's like anything, right? It's like climbing a mountain, right? It's hard when you're doing it, but you look back after it's completed and you think, wow, what a great experience and what you've learned and sort of the skill set that you have and stuff like that. So, no, absolutely don't regret that part of it at all.
Anastasia Koroleva: [00:20:04 - 00:20:15]
So despite trying all these different activities, you could not quite build a similar team that would satisfy you as well as the team at Steel media.
Richard Steel: [00:20:16 - 00:20:35]
Yeah, absolutely. I would say that's absolutely correct. I couldn't recreate it. I didn't necessarily try to, but I had certain attempts over time. But no, it's hard to recreate something like that.
Anastasia Koroleva: [00:20:36 - 00:20:48]
So you have a venture capital firm now, so you're quite involved in other people's companies, but that does not allow you to have that sense of a team, sense of belonging as you did in your own business.
Richard Steel: [00:20:48 - 00:21:48]
No. You know what's so funny? So Parsec Ventures, that's a venture firm that I have right now. It's mostly tech, mostly subscription based tech. So SAS stuff.
Some of them are just more passive investments and others are a little bit more active. The thing that would most closely mirror my time with my first business is actually an off thesis investment that I made in a leadership company. And it's called latitude 35 or Lat 35. And so the CEO and I have regular calls and I feel like I'm able to provide a lot of value to him and growing that business and scaling and doing all the things that we do. And that has been probably the most fun and the most sort of akin to the feelings I was describing earlier, but still wholly different.
Right. It's somebody else running that business and it's more one on one, which I love. I mean, I really enjoy, but it's very different.
Anastasia Koroleva: [00:21:49 - 00:22:07]
So you and I both eagerly agree that we are much better wealth creators than investors.
You chose to have a venture capital firm. Is it because you don't see it as purely an investment? It's actually a value creation exercise for you?
Richard Steel: [00:22:07 - 00:23:12]
Well, I mean, you sort of attempt it to be a value creation exercise. And we've done okay over the years. And we just actually exited two investments recently, and we're looking at a third, which will probably be Q two of 24. So yeah, it's done. Okay.
But it was born out of more an idea of being involved, I think, like you said, we're better sort of wealth creators with our own businesses. And investing is hard. And modern portfolio theory says you have 20 investments, you have ten that are going to lose money, you're going to have eight or nine that are going to break even, and one or two are going to return the fund. Right. And then some.
So that's the approach that you have to take. So it's a lot to manage all those investments. And for me, it's more now about having fun and providing value than it is about trying to hit more home runs.
Anastasia Koroleva: [00:23:13 - 00:23:20]
So in your portfolio of interest, what else gives you fun? And I guess fulfillment, satisfaction.
Richard Steel: [00:23:20 - 00:24:47]
So I've always wanted to write a book. I wrote a book a couple of years ago and that was a really fun experience because I got to do a lot of research for the book. So talking one on one with CEOs and professors, thought leaders, and that was an absolute blast. I love that part of it. But writing is very solitary, right?
Aside from those interviews, right. It's a lot of research. It's a lot of writing. It's a lot of introspection. So it's a very solitary endeavor.
But it was a lot of fun, I think, like a lot of things. If I knew then what I know now, would I have done it? Hard to say. Everybody says, oh, are you going to write another book? And I say, you know, I don't know.
I don't think so. Partly it's based out of fear, right? Because my first book called Elevated Economics, it did so well. It won book of the year in the economics category and it won all these other awards and it was very well received and it was top Amazon bestseller. And the fear part that I mentioned is I'd be sort of scared that my next book wouldn't do as well as the first book.
I wouldn't have the same experience, things like that. So there's a little bit of cowardice there for sure. But it's also a ton of work. And I think I would like to do something that's less solitary with that time and more sort of team based.
Anastasia Koroleva: [00:24:47 - 00:24:57]
Do you have a similar feeling about starting a new business that it may not do as well? Is it one of the reasons why you don't do that?
Richard Steel: [00:25:01 - 00:26:33]
Financially? I don't need to, which is great. As we all know, running a business is just a ton of work, at least the way that I did it. I know CEOs now who, they're taking ski vacations all the time and it seems like they're sort of never at the office. And that was never my experience.
I gave my late twenties to the business. I gave all of my thirties to the business. I gave some of my forty s to the business. I mean, it was a long slog. I feel like there's sort of 20 years that I've piled into working 80 hours a week, right.
Nights and weekends and not going out with friends and sacrificing all this stuff. And I definitely don't want to do it that way again. So I'd be much more inclined to maybe start a business or buy into an existing business with a partner, with an existing team, things like that, where my role would be very specific and less time consuming. But I'm also afraid that I'm kind of an all in kind of guy. So once you sort of do something, I get all in.
And I have a great life. I mean, I'm able to coach my son's baseball team and be there at all my daughter's volleyball games and help them with their schoolwork. And we have dinner as a family almost every night of the week. I'm not willing to trade any of that. I mean, my family is too important.
And the gift of time is an unbelievable gift.
Anastasia Koroleva: [00:26:33 - 00:26:38]
Do your children ever ask you why you don't have a normal nine to five job?
Richard Steel: [00:26:38 - 00:26:58]
Well, actually, I mean, I'm usually gone. I'm out of the house from nine to five. I have an office downtown and all that stuff, and there's certainly enough going on. So, no, we don't really talk about that. They ask me what I do, and I tell them about all the various things, and we have some great discussions about it.
Our cadence as a family is pretty regular that way.
Anastasia Koroleva: [00:27:00 - 00:27:11]
What are the basic principles of your parenting? Are you trying, for example, to raise entrepreneurs, or you're giving your kids complete freedom of choice what they want to do?
Richard Steel: [00:27:11 - 00:27:58]
Sure. So we have discussions about this all the time. There was a friend of mine who talked about his wife's parents being financially manipulative with their daughter, which was, if you live in this city, we will help you buy a house, or if you stay in school, we will pay your bills. Right. That sort of thing.
And that really struck a chord with me, and I hope that I'm never that parent. We actually developed a family crest of our values, which is, everyone has one of these family crests in front of them as we eat dinner every night. This is it. I can send it to you in a PDF so you can put it up there, but that's it.
Anastasia Koroleva: [00:27:59 - 00:27:59]
I love it.
Richard Steel: [00:27:59 - 00:29:48]
And so we talk about four quadrants of life, which are health first, right? I love the saying that a healthy man wants many things. A sick man wants but one. So we talk about health, integrity, hard work, and wealth. And we talk about wealth, and it's specifically on that crest, because it is important, like I said before.
Right. It is power and influence and the ability to have some freedom and choice in your life and things like that. So we do talk about that. We talk about charity quite a bit, as well, and in the center, as you can see, it says happiness, and then it says love, laugh and be together. And at the very bottom, it says, make good decisions.
Right. Because we're trying to have our kids do all of these things. So every night at dinner, we talk about what our day was like, what we're grateful for, what we're looking forward to, and what on this family crest is resonating with us at that present moment. And it might be that something happened at school with the kids or something happened at work, et cetera, and then so we can talk about those issues as well. So parenting for us, I think, is very, I hate to use that word intentionally, because it's so everybody sells all the time, but it is very intentional.
We really think about it. And I don't have aspirations for my children to do any one thing, be an entrepreneur, go to Harvard or be a rocket scientist or an astronaut or something. But I want them to do what they enjoy, but do it well, right. Have some ambition in life, want to do something, whatever that thing is, and do it well and all that sort of stuff. And I hope that they get enjoyment and fulfillment and satisfaction and joy, really, out of their pursuits.
Anastasia Koroleva: [00:29:48 - 00:29:57]
What about you and your wife? How did you maintain a happy marriage through all these different interesting events you had in life? Building a business, selling a business.
Richard Steel: [00:29:57 - 00:32:52]
Yeah. No, it's tough. So my wife actually worked in the business, so she left her job. She was a television producer doing national news in New York. She had a great job.
She would go and interview the president, and she know Colin Powell in her Rolodex and the president of the United States, and just, she had a really incredible fun job. And she left that job to support me and this business. And she worked in that business doing accounting, collections, finances, and it was great. It was really helpful. I really trusted her, and we really bonded over that.
Some people, it can sort of cleave their relationship, but we really bonded over that. I think if I'm being very truthful, after selling the business, I believe that there was an expectation on her side that, like, okay, well, now it's done, right? It's kind of like there was a moment in the movie free solo about this guy who climbs mountains without ropes, and he has a girlfriend, and so he climbs El Capitan in Yosemite, and he completes it. He does it, spoiler alert. He doesn't die, he doesn't fall down, and he calls his girlfriend when he's literally at the top of the mountain after he's just completed and she says words to the effect of like, yay.
Like, thank goodness, now you're done. Which I think sort of betrays this disconnect in their relationship. Like, this is who he is. This is what this guy does. By no means is he done.
And I think I did a bad job of talking about that with my wife and sort of discussing what was next and what I wanted out of life and how this was going to play out. And so her expectation was sort of like, yay, it's done. Right now. We're going to have all this time and all this sort of stuff. And I was obviously hard charging on integration and things for the next two years and taking a company public and all that stuff.
So it was sort of the same cadence of intensity. But then after that, our expectations were mismatched, and I did a bad job of communicating that and sort of stepping up. So navigating through that, it's very tricky. So on Monday mornings, we set aside a half an hour to do a check in. No kids.
And that has been very important and very helpful. And I'm somebody who doesn't really like to open up. Contrary to what it might seem like on this, I'm happy to talk about business, so challenging myself to open up and also realizing that that's a good thing and it's healthy for our relationship. So, yeah, by no means smooth sailing, but such is life. And I think that it's a process of growing and learning and having compassion and stepping into the other person's shoes, which I'm not necessarily good at.
Anastasia Koroleva: [00:32:53 - 00:32:54]
It's a challenge.
Richard Steel: [00:32:55 - 00:33:05]
It's a challenge. I should start a podcast and interview you because every question you ask me, I want to ask you the same question. But I know that's not the sort of roles that we're in right now, but I think you'd have a lot of questions for me, too.
Anastasia Koroleva: [00:33:05 - 00:33:11]
Maybe one day you will when you're bored of all the million activities you already do it right now.
Richard Steel: [00:33:12 - 00:33:14]
Yeah, maybe. Maybe.
Anastasia Koroleva: [00:33:14 - 00:33:19]
You mentioned the White House, and I know you've been involved as well at the White House business council.
Richard Steel: [00:33:20 - 00:33:20]
Yeah.
Anastasia Koroleva: [00:33:20 - 00:33:22]
Can you tell me more about that?
Richard Steel: [00:33:23 - 00:35:22]
Yeah. So I've been doing that for probably nine or ten years, something like that. And it's phenomenal. So we have fly ins and fly outs. So a fly in is where myself and other business leaders will meet at the White House.
We're either in the White House itself or in the Eisenhower executive office building, which is right next door. And we're meeting with senior officials, discussing economic problems, innovation issues, things like that. That has been, over time, really exhilarating, very fun. Again, you think about these mountains you're not meant to climb. Like you step inside the White House and you're there, again, not as a tourist.
You're there to provide feedback and guidance and give your input. It's unbelievable. It's incredible. So I'm very grateful for those experiences. And I've got to meet the president and be in the same room with Obama and Biden.
And it's been phenomenal. You know how it is, right? From one opportunity comes another opportunity. I was lucky enough to be able to work on innovation policy and economic competitiveness during the Biden campaign, and that was phenomenal. I found a lot of people that were very humble and hardworking, and they didn't sort of talk bad about the other side and all this stuff.
It was actually kind of surprising to me. And I don't necessarily identify myself as really a political person more than just somebody who's interested in these issues. And I hold ideas and beliefs that are on sort of both sides of the aisle in American politics. But those experiences have been absolutely phenomenal, and I look forward to continuing those in some of these other pursuits.
Anastasia Koroleva: [00:35:23 - 00:35:47]
So, Richard, not only we met at an academic institution, and that was what, twelve years ago? It seems to me that since then you never stop doing some other form of education, usually some big name schools, water, then Stanford. Can you tell me more about that and why you're doing it and what you're getting out of it?
Richard Steel: [00:35:47 - 00:38:08]
Yeah, I did mention the concept of lifelong learning, and I know that might almost be a cliche, but I really have enjoyed those sort of continuing education experiences. So I went through a program for corporate director certification, and I had the opportunity. HBS has one, Northwestern has one, Stanford has one. There are a few others, and then there's some for profits that have them too, specifically NACD and ACCD. But I wanted to go back to an educational institution to do one of those.
So I did choose the Stanford program, and it's a week long program specifically for corporate directors on Stanford campus. And it was absolutely phenomenal, the quality of the folks that we had. I mean, we had folks from Disney and Visa, and we had a retired admiral from the Navy, et cetera, et cetera, et cetera. I mean, just absolutely incredible. So that was very interesting.
And for me, it's always about the Rumsfeld quote, right? Of we have our known knowns, we have our unknown knowns. We have our known unknowns, and then we have our unknown unknowns and to me, the unknown unknowns are the things that I don't know. That I don't know. And so I want to be the best director that I can.
I want to be the best mentor that I can. I want to be the best investor that I can. And so that's why I did the corporate director certification. I'm a huge fan of HBS. So I will say that the way that things were done at Stanford versus the way that I was conditioned that things are done at HBS, it was very different.
So that was good to see culturally. And then I would say after writing my book, which was really about changing investor and consumer behavior, I wanted to understand sustainable investment more. So I did a certification with the US Sif. So I've done a lot of this continuing education stuff, and I do find it very interesting and beneficial, and I do think that it helps me sort of get to the next level. So, yeah, I'd recommend that sort of stuff for anybody happy to chat with anybody who wants to know more about that stuff, too.
Anastasia Koroleva: [00:38:08 - 00:38:14]
Brilliant. Brilliant. That's very helpful. Thank you. So tell me, why did you write your book?
Richard Steel: [00:38:15 - 00:40:10]
Well, so two reasons. Number one, I had always just wanted to write a book. So that was just something that, it was an itch that I wanted to scratch, I was having specifically within the context of YPO, which we talked about earlier, I was having a lot of discussions, whether it was in forum or outside of the forum experience with YPOers, about how to navigate all these myriad challenges that we see in business. Right.
The dawning of the age of ESG and DEI and consumers and investors really demanding more and expecting more of leaders. And so I wanted to delve into that. What were the reasons behind that? What was this sort of changing environment that was making these conditions ripe for this sort of change? And what does that mean for ypoers?
I'm a huge capitalist. I do believe that corporate America specifically has the opportunity to change the world for the better. And my personal motto, which I've thought long and hard about, is to affect positive change at scale. And I think the at scale part is really influenced by large companies taking a stand and doing the right thing. Taking a stand where appropriate.
Let me sort of caveat that. And so I wanted to explore these ideas. That was sort of the genesis for the book. So I had this seed idea of like, I want to write this book. Here are the things that I talk about all the time, but I don't necessarily have more time than sort of a typical conversation takes to delve deeper into these things.
I finally had the time. Well, I didn't really have the time, but I made the time to do it and it was fascinating, like I mentioned before. So that's sort of the genesis behind it.
Anastasia Koroleva: [00:40:10 - 00:40:17]
So on a more practical level, how did writing a book fit into your overall strategy after you sold your business?
Richard Steel: [00:40:17 - 00:40:38]
I didn't have a personal strategy after I had sold the business because I was involved in other things after selling the business and then with New co and public company and all the stuff we've talked about, it was just something I had always wanted to do. And sometimes you just have to put a stake in the ground and say, I'm going to do.
Anastasia Koroleva: [00:40:38 - 00:40:41]
And so you finally had the time.
Richard Steel: [00:40:42 - 00:41:09]
Yeah, it was funny. I'd like to say that kind of like I mentioned before, I didn't really have the time. There were a lot of very late nights that I didn't anticipate, but I had more time than I guess I had had before. So that was great. And it was really a passion project and I had no idea what to expect.
I didn't know about marketing and the media tour and press. It was a really new, engaging sort of learning curve for me. I loved it.
Anastasia Koroleva: [00:41:09 - 00:41:24]
On your LinkedIn profile, it says that you are a CEO, board member, author, speaker, then optimist is my favorite. How did you come up with that one?
Richard Steel: [00:41:25 - 00:42:59]
Well, all those things are true. And it's funny because I don't have any social media whatsoever. I don't have X or Facebook or Instagram or Snapchat, I have absolutely nothing. But I do have LinkedIn. They're all things that we've done, right.
We are these things, or we were these things in our past lives. We have been these things at certain times over our lives. But I've been an optimist my whole life. And I think that that is something, that is a character trait that you have to have when you're leading an organization, leading people, leading a family. And if you don't have that, what's the point, right?
Like I said, when we're sitting around as a family, we talk about what we're grateful for and what we're looking forward to. And the looking forward to part is important because there always needs to be something to look forward to, right? To drive you forward. And I think that that word optimist encompasses that belief as well. It doesn't mean that you're naive about the world or circumstances or how hard things might be and what the headwinds look like, but that you are optimistic that with the right people and the right attitude that you can get through those headwinds.
Richard Steel: [00:42:59 - 00:43:47]
And I think that that's just so important. Probably all the people that listen to this are in the same or similar position to you and I where we've exited a business. We don't have to do anything. We don't have to do anything at all. Right.
We could watch Netflix all day. But I think being an optimist about various aspects of life, whether it's personal, professional, et cetera, is just critically, critically important. And I don't do a good job of it every day. I don't do a good job of it every week or every month. But I think that it's important.
So it's a trigger for me to see that and remember that that is who I need to be as well as who I think that I am.
Anastasia Koroleva: [00:43:47 - 00:44:05]
So it sounds like you've given quite a lot of thought to your identity and who you are. Is there anything else in your identity that you could share or your thinking how you went through this? Because it's one of those things that all exited founders have to go through.
Richard Steel: [00:44:06 - 00:45:18]
Yeah. So there are people who have thought deeper about this than I have, and there are people that are phenomenal social scientists and psychologists that have thought long and deeply about all this stuff. And I think Arthur Brooks is a great author. He writes in the Atlantic. He's written two books.
One of his books is called Strength to strength, and his other, more recent book is called Build the Life you want. And he actually came to speak to the Harvard Business School Alumni Board. So we had time with Arthur a couple of years ago, and that was really very impactful for me. And strength to strength is a book that everybody should read, especially every single person who listens or sees this should read. And it basically talks about career transition.
And I'll summarize it poorly. But basically, in your early phases of life, the way that your brain works is ideally suited to solve novel problems. And as you age, your brain chemistry and physiology changes. So you move from what's called fluid intelligence to crystallized intelligence. And crystallized intelligence is more your wisdom and your experience.
Richard Steel: [00:45:18 - 00:46:03]
So relying on that, so trying to do the same thing that you did in your twenties and thirties and maybe early 40s that you're now going to attempt to do in your forties, fifties, sixties is probably not the best idea. And so relying on crystallized intelligence versus fluid intelligence as you age is a way to realize more happiness, more joy, more fulfillment in life. Anyway, basically, I would say that there are people that have done the research and are smarter than I am about this stuff, and I think that relying on their work and their research would be a better answer than I could ever give, especially Arthur Brooks.
Anastasia Koroleva: [00:46:04 - 00:46:30]
Strength to strength comes up in our discussion in the community quite often, and I noticed that some people actually find it depressing because they think, oh, it's over for me, while other people find it liberating and encouraging, me included. Because you think, oh, I can actually ride that second wave even better. With more fun, with more meaning. I absolutely love it. Have you mentioned it?
Richard Steel: [00:46:30 - 00:48:14]
Yeah. No, look, I was just on campus for one of the board meetings maybe three weeks ago, and after the board meeting, there's the reunion programming. So it wasn't my reunion year, but I could go to the reunion programming anyway as a member of the board. And so my nine year old son said, months and months advances, hey, can we come know? I'd love to see campus.
And he'd never been on campus before. And so I finished the board meeting, and then they came in the next day, and we went to some reunion programming, and there was a class. There was a class about happiness that followed the Harvard longitudinal study, which was phenomenal. And there was another one on family wealth. So I was able to take my kids on campus and go to these classes, and it was phenomenal.
And in the happiness class, the issue was brought up about what you're saying, is this depressing or is this liberating? And for me, using that crystallized intelligence, that wisdom and experience over time, I teach a class at the university here about failure. Right. So I go through all the failures in my life and business and all the rest of it. It's a very difficult thing for me to do, but I think it's very valuable, fairly emotional as well.
But the ability that I've had to be able to actually provide real value to other entrepreneurs, folks in real businesses making real money. Right. Employing real people has been incredibly gratifying to me. So I think that much like you, for me, it's very energizing to be able to rely on that crystallized intelligence and that experience to help others not make the same mistakes that I did, et cetera, et cetera, et cetera.
Anastasia Koroleva: [00:48:15 - 00:48:23]
So, talking about failures, what was the most impactful, consequential failure in your life?
Richard Steel: [00:48:23 - 00:49:36]
Oh, wow. So many to choose from. Oh, I've been very lucky. And I don't really look back with a ton of regret. Of course I have them, but I would say it would be more on the personal side than the business side and it would be much more when I was younger rather than in my professional life.
So sort of that not treating people the way that I would have want to be treated, not following the golden rule, right. When I was probably in my teens or twenties, I think is probably my biggest regret, right? Not caring for people that were close to me as well as I should have, looking back on it. So I would say that that's probably my biggest personal failure and deep regret as well.
Anastasia Koroleva: [00:49:36 - 00:49:55]
It's so interesting because my answer would be not expressing gratitude enough, especially early in life. I think yours is actually quite similar to that. Fascinating. So have you ever had the feeling of being lonely at the top?
Richard Steel: [00:49:55 - 00:50:56]
Oh, yeah, absolutely. 100%. I never had a mentor or formal board or anything like that in my first company. I've since changed that with other companies and endeavors and things like that. But yeah, I was always sort of inventing the wheel.
Yeah, of course. Very lonely and nobody has, nor should they, empathy for people who are making a lot of money and at the top and have this power and prestige and influence and all the rest of it. I think maybe appropriately lonely at the top, but that's what YPO is for. And organizations like EO or HBS has HBS forums or HBS circles or something like that. So yeah, no, I think that everybody should seek out a personal board of advisors in whatever capacity.
Anastasia Koroleva: [00:50:56 - 00:51:03]
So that's basically the way you solve it for yourself, finding these peer groups essentially, yeah.
Richard Steel: [00:51:05 - 00:51:35]
I get a lot of sort of soul enriching nourishment, discussing of problems and bearing my soul and airing my grievances and whatnot with folks in and out of YPO or other circles. I have a decent enough friend group as well now but you know that was not the case. That was not the case earlier.
Anastasia Koroleva: [00:51:35 - 00:51:41]
So do you think post exit founders in particular often feel lonely?
Richard Steel: [00:51:42 - 00:53:00]
Oh, absolutely. A couple years ago I went to this seminar put on by a guy who runs Crestone Capital and he has this great presentation about post exit founders. And he shows this slide where you've got your calendar when you were working and your calendar after you sell your business and one's full and one's completely empty. I was going more as like, hey, this will be fun. I went as sort of a lark and it was great.
I was know kind of everything he was saying. There's a Yale study and then framework and matrix that people can use after they exit as far as what they're going to do next. I actually, before I even found that I made my own personal matrix about what I love to do, what I hate to do, what I'm good at, what I'm bad at. Right. Sort of that Venn diagram.
And then what I already have enough of. What are my qualities? What are my aspirations? How much time do I have crystallized intelligence versus fluid intelligence? How can I change the world for the better?
What are the opportunities that exist? What would I love to do? And then some other factors. So I actually made a matrix for myself and sort of filled that out and that helped as a sort of a guidepost. And there's lots of other activities people can do.
Anastasia Koroleva: [00:53:00 - 00:53:07]
Yeah, brilliant. So how do you choose people you surround yourself with now?
Richard Steel: [00:53:07 - 00:54:00]
Yeah, very carefully. Very carefully and actively seeking out positive, uplifting, but also interesting and dynamic people. That's, I think, pretty easy to do in the circles that we travel in, you and I, as well as probably all the folks listening. And so that's great. But being really specific, it was funny.
My wife emailed me the other day, we were joking about this last night, and she says, I'd like to go out with these three couples. And I emailed her back and I said, how about this other couple? Like, basically, can we trade? Because I don't like any of these people well enough, and they're all fine and decent people, but I'm very specific and very particular. And I would say one thing else to anybody who is an introvert.
Richard Steel: [00:54:00 - 00:55:04]
I didn't know that I was an introvert for a long time. And I heard a definition that resonated with me, which was, introverts are simply people who recharge their batteries by being alone. It doesn't mean that they don't like people. Groups of people, lots of people. But after you have an experience with a group and a lot of people, you need to recharge by being alone.
And I was like, wow, that's me. That is absolutely me. So I think sort of two things in concert. Number one is surround myself with uplifting, interesting, engaging, fascinating people who are positive and realize that it is okay for me to go and recharge my batteries myself. Right.
And I'm in a relationship with somebody who is an extrovert. Right. So finding a balance between go, go and do everything all the time versus having the opportunity to recharge is sort of a constant back and forth. It's not a bad thing, but it's just something that needs to be openly discussed, which we do, which is great.
Anastasia Koroleva: [00:55:04 - 00:55:06]
Whom do you want to be when you grow up?
Richard Steel: [00:55:10 - 00:57:01]
That's such a great question. I don't know. I didn't prepare that in advance. I am always sort of I have this thought that if I died tomorrow, don't feel bad for me. I've had the most amazing life.
I mean, HBS and the White House and writing a book and traveling all over the world. I mean, it's like selling a business, public company. It's crazy. It's absolutely ridiculous. So I feel like I've lived many lifetimes already.
So as far as who I want to be when I grow up, I want to be somebody who is seen as kind to others and what they call it, a stand up guy. Right. Somebody who does the right thing, even when it's difficult or unpopular. I think that's how I would want to be remembered. I would like to keep a breadth of interests and help as many people as I can.
I just joined the board of the Red Cross for the Pacific region in the United States, and so I want to continue to affect positive change at scale by helping as many people as I can. And whether that's entrepreneurs one on one with our venture portfolio, fine. But if it's also helping charitable endeavors and people that are affected by disasters, but you know fine. I work with this charity called C International, where you can make a blind person see for $4.80 in India and Nepal and Bangladesh. I mean, it's unbelievable, right?
So to be able to give the gift of sight, to know, that's incredible. So there's all these opportunities out there, and I want to keep on exploring those, but I want to have my life shift to be focused on helping others and not doing things specifically for material gain for myself.
Anastasia Koroleva: [00:57:01 - 00:57:05]
Okay. Talking about that, how do you stay fit and healthy?
Richard Steel: [00:57:06 - 00:58:47]
Okay, so, yeah, I work out every day. I meditate every day for at least five minutes. I do yoga. I play. I think play is fun.
I know it's very cliche, but I play pickleball, and I really like it. Yeah. I've just started doing yoga, actually, which is great. I have some neck issues and some migraine stuff, and so that helps. Yeah.
I try and sleep as much as I can, unapologetically. My wife and I have a routine where she's an early bird and I'm a night owl. And so we divide our responsibilities. Like, I'll put the kids to bed and take the dog out and clean up the house at the end of the day, and she'll go to bed very early, and she's up early, so she takes the dog out and gets the kids to school. Right.
So we sort of have that sort of symbiosis, which is very good, right. I'm very specific about what I eat and I meal prep. So on Sundays, I meal prep for the week and make salads and I do all this sort of stuff. My kids think I'm crazy, but, yeah, don't eat sugar. Limit my caffeine intake to basically one cup of coffee a day.
All this sort of stuff that we learn over time, right? So mostly a plant based diet and try and stay away from all the bad stuff. I don't eat sugar. I don't drink alcohol at all, especially because I get these migraines and that's a bit of a trigger. So all those things, again, I could look at it like, oh, woe is me.
I don't get to drink alcohol. But what I tell my kids is, look, this is a gift, right? Alcohol is a problem for a lot of people. And for me, it can't be a problem because I can't drink it. Otherwise it'll trigger these migraines.
Richard Steel: [00:58:47 - 00:59:14]
So I can either be woe is me about it, or I can change my outlook and say, hey, this is a gift. I'm healthier, I sleep better, and it's going to prevent me from getting some of these terrible headaches and stuff like that. So if I ever have, like a calendar conflict and it's conflicting with something that is related to my health, I'll always choose that over whatever the other thing is that might be business related or seemingly urgent or whatever. Health first. Health first.
Health first.
Anastasia Koroleva: [00:59:14 - 00:59:19]
It's really amazing that you actually do it all the right things because we all know what they are.
Richard Steel: [00:59:19 - 00:59:22]
I'll try. I mean, I had a popcorn last night.
Anastasia Koroleva: [00:59:23 - 00:59:25]
So that brings me to the last question.
Richard Steel: [00:59:26 - 00:59:26]
Good.
Anastasia Koroleva: [00:59:26 - 00:59:28]
What keeps you up at night?
Richard Steel: [00:59:28 - 01:00:06]
Usually it's something to do with our kids. I don't get too distressed about professional pursuits or business things and stuff like that. I think I have a my wife would probably call it a unique ability to not worry. I don't really worry about too much of the small stuff, and I think focusing on the little things, there's only one saying in our house that is visible and it says, enjoy the little things in life, for someday you will realize they are the big things.
Richard Steel: [01:00:07 - 01:01:05]
And it's a little cheesy, but it's definitely true. Right? So going outside and taking a walk or throwing the ball around with my son. My son doesn't know this, but my rule to myself is every time if he asks me, do you want to throw the ball around I say yes. It doesn't matter if I'm tired, sick, it's dark outside, it's cold, whatever it is, if he ever asks me that question, I always say yes.
And that's as a result of understanding that it is those little things in life that really make up what your life is. Right. The things that we do on a daily basis are who we become and they are our relationships. Right. And so I think putting those, trying to put those first, and I don't do a job, good job at any of this, necessarily, but at least I try, right? And I think that those are the ingredients for a good life for me.
Anastasia Koroleva: [01:01:06 - 01:01:10]
Richard, thank you so much. It was absolutely amazing. So much.
Richard Steel: [01:01:10 - 01:01:23]
You ask good questions. Thank you. So know who doesn't like to sit on the phone for an hour and talk about themselves, right? So it's a very heady process, but I really appreciate it. This was a lot of fun.
I hope you were a perfect guest.
Anastasia Koroleva: [01:01:23 - 01:01:26]
As I said, you were really a perfect guest. Thank you.
Richard Steel: [01:01:26 - 01:01:27]
Thank you. That's very kind of you. I really appreciate.
