Episode 39 – Mike Michalowicz


Mike Michalowicz strums his way to better connections

 

Mike says that he isn’t good at it but he really enjoys playing the guitar. He finds that concentrating on something other than work allows him to disconnect and gives him a release to come back to the office refreshed. He also likes to be outdoors hiking, which he says is also a fun way to have a business meeting, creating a “remember when” experience with clients or coworkers that creates stronger bonds.

In this episode, we talk about how you, yes you, have permission to talk about your hobbies and passions at work. This gives your coworkers and clients a deeper, pneumatic connection so they’ll actually remember you. Mike also adds that the best organizations create a culture that empowers each employee to truly be themselves while also being a representative of the organization.

Mike Michalowicz is an entrepreneur and popular keynote speaker on innovative topics. He’s also a former small business columnist for The Wall Street Journal; is the former MSNBC business make-over expert; and is the author of Surge, Profit First, The Pumpkin Plan and The Toilet Paper Entrepreneur, which BusinessWeek deemed “the entrepreneur’s cult classic”.

He graduated with degrees in Finance and Management Science from Virginia Tech, where he was a member of the lacrosse team.

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Other pictures of Mike

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Mike delivers his keynote speech at a recent conference.

Mike jams on his guitar in the office.

You may recognize Mike from his time on MSNBC as a small business expert.

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Transcript

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    JOHN GARRETT. Mike Michalowicz has had small business column in the Wall Street Journal and been seen on MSNBC, but most of you might know him for his innovative strategy, Profit First Formula. This is a way for businesses to ensure profitability from the beginning. I’m surprised we haven’t crossed paths in an airport yet because he’s a keynote speaker at a ton of conferences. So Mike I’m so glad you’re here to let everyone know, maybe, how you got to where you’re at now.

    MIKE MICHALOWICZ. Yeah, you got it. Today I’m a full time author, I’ve written four books. My most recent release is Surge, perhaps the book that is most recognized is called Profit First. My background is entrepreneurial. After graduating college instead of going into any kind of profession for a long period of time I started my first business at 23 in the tech space had the good fortune of selling it to private equity. I started a second company in forensic crimes, crime investigation but with forensic technology. That was the big one, we in part facilitated the investigation of the Enron trial and other big cases.

    JOHN. Wow, that’s awesome!

    MIKE. It was. It gets even more awesome, we sold it to a Fortune 500, my business partner; it was just me and him. I think the most interesting part of my story was after that. I thought I knew what it took to be successful, pump and dump was kind of my mentality, build a business and sell it. That’s where I lost my shirt. I became an angel investor, I call myself the angel of death because I was that bad. I was just that bad.

    JOHN. No, we don’t want your money Mike, we’ve heard your stories, we’re good.

    MIKE. Exactly. That triggered a restart in my life. I nearly went bankrupt. My accountant says I should have declared bankruptcy, I would have been better off. Ethically it didn’t feel right. I was able to slowly, but effectively, recover, but I was also able to take the thing I wanted to do. I wanted to write, I wanted to share the things I’ve discovered along the way and teach other people to do the same. I really wanted to reeducate myself, I thought I knew what it took to be successful.

    JOHN. You go back to study. That’s so fascinating. So you just started right out of college, just started your own business, you had zero big corporate America work experience?

    MIKE. Well, very little. I came out of college, I was hoping I could get the big corporate job but I couldn’t. I got a job at a little computer store, but after working there about a year and half it sucked. I was selling printers, and it just sucked.

    JOHN. This is what Steve Jobs does, what the hell? This is crazy.

    MIKE. So I went out for drinks with another guy I worked with there and he said, “you know, if you really think you can do it on your own why don’t you do it on your own?” With enough beers in me I was like, “yeah.”

    JOHN. You’re talking to the hot girls, buying a Ferrari, you’re doing all that.

    MIKE. Right! So I quit on the spot. I actually left a drunken, horrible message for the boss, “f-you.” Next morning sobriety I actually tried getting my job back and he said, “sorry kiddo, too late.” So I was off on my own. It was terrifying, but it worked.

    JOHN. That’s so fantastic, and so I guess the thing that I love to find out about people is, because especially when you start your own business, and as a speaker and an author, both of us know what that’s like, but that’s a ton of work, a lot of man hours, and a lot of time. A lot of accountants and bookkeepers are the same way, you know those smaller shops. That does take up a ton of time, but what were some of the hobbies and passions did you find you had time for as this was going?

    MIKE. My one stalwart hobby has been playing guitar, I’ve done it ever since I was a teenager. I’m not good, I’m a three cord type of guy, but there is an interesting disconnect when I have to concentrate a lot on something. So, just pulling out the guitar and strumming away, and I define it as a hobby because the longer I do it in any given session I actually get tired of it. I’ll play guitar for a half hour or hour, and it starts to fade. As opposed to a passion that’s more of an addiction, I want to do more of it.

    JOHN. Right.

    MIKE. That was the big thing. Also, I love the outdoor stuff, so biking and exercise. I consider it a hobby, it’s an activity I enjoy to do, and the residual benefits are pretty darn good.

    JOHN. Sure, absolutely. like you said there is that disconnect, so you can remove yourself from the daily grind and the 24/7 when you’re an entrepreneur, you can have that reprieve to just bury yourself in a guitar. Did it matter to you that you weren’t good? Or still aren’t maybe, I don’t know?

    MIKE. It never really did matter. What was nice is I could see progress, like applying the same core fundamentals. Say a new song came out I’d be like, “you know, I’d like to play that song.” You can go online to one of these archive sites and find the core pattern and very quickly could assemble something. What’s cool about guitar is when I say you have to learn a new song you just have to learn the sequence of chords. You actually know the song you just don’t know the sequence. So it’s refreshing because I can put the guitar down for three months and pick it up and e working on a new song in ten minutes, because the fundamentals are there.

    JOHN. I’m sure that translates over to business somehow, did you find that?

    MIKE. Isn’t it funny in life that almost everything translates? In business any time I get approached by a new project one way to look at it is it’s a brand new project and I have to learn everything from scratch, or I can say that let’s just play within the chords I know and it’s much easier to discern if I should do it or not. It’s partly moved me towards niche specialization. What I noticed with a niche, when I serve a certain type of client and I serve that client over and over, not that one client but clients just like them, it’s consistently the same chords, they want to hear the same melody. It’s translated. When I have to learn a new instrument to serve a new client that’s when the problems happen.

    JOHN. That’s so profound, and it’s also neat that you were able to see that those skills did translate, because I think a lot of people just think, “oh, it’s a hobby, it’s a passion, it’s a whatever. It distracts from your actual career.” Which I think isn’t the right message.

    MIKE. No, no, no. I would agree. What it is, it’s an outlet. We need to disconnect from the one thing we’re doing over and over again, just to let ourselves recoup. A hobby is something that gives us enjoyment, but there is inevitably lessons. I don’t think we need to pick a hobby to compliment our work so that when we’re not working we’re still working. Actually when I started playing guitar I thought, “I actually might be able to get a girl, I might be able to actually date a chick!”

    JOHN. When you’re a teenager you know just the chorus, that’s all you need to know really, maybe the first two lines.

    MIKE. Exactly! I’m like, “this could actually work.” So that’s why I picked it up, and then I found that it’s just become a great outlet.

    JOHN. Something that you enjoy doing, and it is a reprieve. So did you find that when you were running your businesses, did you talk about playing the guitar? Or talk about being outdoors? Or maybe something you did over the weekend? Things like that, would that come up in conversations?

    MIKE. Oh yes, there’s no question right? There’s this component of commonality, if you and I went to the same college or whatever, actually I’ll share a story. I was traveling through Russia, this was a way back, no one speaks English and I don’t speak Russian. So, if you sit in the cafe you have to do hand signals and gestures to get coffee. One guy says something in English, perfect English, to someone else. Ends up the guy is from one town over from where I grew up in New Jersey.

    JOHN. Holy cow!

    MIKE. Right? That’s what I said, “holy cow!” Now, all the sudden, we’re best friends. The irony is, if we’re in a cafe here in New Jersey and there’s a guy from a town over you think, “oh that jerk.”

    JOHN. He’s a rival.

    MIKE. Yeah, he’s a rival now. There’s no interest, there’s no intrigue. So when there is commonality, I found, particularly in uncommon situations, it builds a massive bond. So, when I am talking to someone in my space where I work, I work with a lot of accountants and bookkeepers, and someone else plays guitar it’s like we’re brothers found each other in Russia. It is a great conversation tool, but the other component is if I say, “I play guitar.” And someone is like, “I don’t play guitar at all, and I have no interest in music,” if I talk about it I’m just really selfishly speaking to my own interest but they have no care.

    JOHN. Right, and that is the fine point, the fine line, between where the teeter totter tips; where you’re sharing a little bit about what you’re doing versus bragging and using your bullhorn, and things like that. It’s more of giving them permission to share what they enjoy doing as well. Plus, it’s cool, because then they at least know who you are and what you enjoy doing beyond the work.

    I found, anyway, when I was working corporate that if people had no hobby or passion identity then they were completely forgettable to me. I forgot all about some of these people I feel bad, because they worked with me for so long, but that’s how I identify most of the people that I know, “oh this guy loves the Steelers, that guy went to Virginia Tech,” things like that.

    MIKE. It’s funny, even just by saying that, it’s like that’s important to me and you recognize something that’s very important to me, so that’s significant that you said that. I think there is also this kind of pneumatic connection. What I mean by pneumatic connection is if I say I’m an accountant in a lawyer, or whatever, industry it’s hard to put a picture to that. If I say “I’m a huge guitar fan, I love to play guitar,” you can associate me playing guitar. Every time you see me you can almost put that pneumatic picture on me, me jamming on the guitar. You’ll bring up the conversation of something that’s very poignant and significant to me. It’s a great way to remember people and their interests. Like, you said Virginia Tech and I was like, “yeah, that’s right man! Rock on!”

    JOHN. A little inner sandman, a little hokey. We’re only two months away from football season, I can’t wait. My wife, not as excited, but she’ll get over it, it’s every year.

    MIKE. My wife is not excited but she’s going to four games this year, with me.

    JOHN. She just found out, listening to the Green Apple Podcast.

    MIKE. Yeah, she just found out. She’s going to four games with me, and I’m even considering buying a big screen TV for our back porch so I can watch TV outside this year.

    JOHN. Yes, absolutely, then it feels like you’re at the game. I love it, that’s so fantastic, I’ll be right over. So, did you find, or do you find now, that this benefits your career?

    MIKE. Yeah, no question about it. It’s interesting, I consider it a 5% rule. The 5% of the uniquenesses I have is what becomes compelling to others, memorable. I want to share one very specific thing too about it. So I’ve shared I play guitar, but I’m also really an outdoor enthusiast; I don’t go hiking every day, like this morning I went for a bike ride, but I do like to hike and so forth.

    One specific example, I was talking with a potential prospect, somebody who could have become a client in our organization. They said, “last time we talked you remember you said you recently went for a hike? I love hiking too, that’s so cool.” I said, “hey, we’re going to meet face to face, why sit in a stuffy conference room? Let’s meet at the local county park and hike it out?” I triggered this concept of these walking, hiking, meetings. She signed up as a client, but my favorite part was when she signed up she said, “hey great time,” and sent a selfie that we took, me and her, in front of this swampy kind of lake that was on the hiking trail. I’m not saying that was the selling point, but I know everyone else she was considering, we weren’t the only vendor, no one else had that selfie.

    JOHN. Right, absolutely, and that’s something that she’ll remember immediately because everybody else does the service that you provide. Now, whether it’s the same level, it’s still the same service when you boil it down. But, who created that connection, to be able to then highlight the differences of what your business does do better, as opposed to coming at her with business, business, business. It’s like, no, who are you as a person.

    MIKE. Yeah, and we all want to do business with other people. It’s so obvious, right?

    JOHN. I think professionalism just trains us, work, work, work, get a degree, get a certification, get another degree, get a certification, work, be the super, know everything that there is to know about everything.

    MIKE. Here’s the problem with that. Someone works with you because you’re the professional, you just put on the professional side. That means it’s all they care about and the next person that comes through with a better price, a better deal, you become very replaceable. It’s ironic, it’s in those intangible things that really, maybe the consumer will never buy, but they connect with. That’s where the value is.

    JOHN. Absolutely, whether it’s as an employee that’s maybe going to look for a new job, probably not as much now if they’re around their friends and people they enjoy being with. The same with a client, you took a selfie in front of a lake, for her to jump ship to a new provider, that’s going to take a lot, or you’re going to have to really mess that up. That’s what’s really great about that, and it’s cool that you are able to see that and articulate it much better than a clown like me.

    MIKE. What’s there is these also constantly shared stories. What I find is that if we have an experience with someone else, a client or whoever it is, it becomes a shared story. You can look at any experience with your friends, when you connect again what do you talk about? Your shared stories, remember when? If you can create those remember when moments with clients, that’s significant. She’s brought it up a couple times that, “oh remember when we went for that hike?” Now we’re creating other shared experiences. That’s her thing, I like it, we’re out hiking every so often for our meetings and it creates more shared experiences.

    JOHN. That’s so powerful man, that’s great. One thing that I like to think about, because I have the time, is when it comes to organizations, big four firms, or bigger companies, how much is creating this engaging corporate culture type of world on the organization as a whole or on the individual?

    MIKE. Large corporations, now I do have direct experience as an employee. When I sold my second company the Fortune 500 that bought us was called Robert Half International. So I went to work for them for a year and a half, I was a horrible employee by the way. I do not understand the corporate world, but I did observe certain things. One of the interesting things is, the concept of do what you’re told and do it fast and effectively and we’ll give you more to do, just do what you’re told. I notice that at some business, some of the people I was dealing with they said, “be representative of our brand being expanding on who you are.” The corporate entity has a responsibility to encourage people to be individualistic while still facilitating the goal of the corporation, but truly be yourself. Going back to our discussion up to this point, it’s those intangibles and those things that make you unique, that connects you and bonds you with others. So I think it is the responsibility of the corporation to have a clear vision of what the corporation is doing and the impact that the individuals need to have, but to empower the individuals to share their own stories, to truly be themselves, because that’s what builds affinity, that’s what builds the bond.

    JOHN. It is definitely a mix, because the organization can lead the horse to water, but if people are just so scared or so bought into this professionalism mantra, then the organization can only do so much, and maybe it’s not a good fit. Certainly the leadership can create that, and I think what I’ve found is that if it’s a huge organization it can be just within a division or within your section of the floor, or whatever it is, but the leadership can certainly help set that tone.

    What might be some barriers that you think some of the people might be reluctant to share, some people you’ve come across that are like, “I really like hiking, but don’t tell anybody.”

    MIKE. It’s interesting, so when I see people, and listen when I say, “I see people,” I’m one of the people. When I see people try to adjust their presentation of themselves to match what they think the other person wants, and it’s very artificial. For example, “I think John only wants to hear about X, Y, Z, and I’ll only speak about that, not bring up other things.” Most of us shy away from sharing the ugly things, I think that’s a mistake to because it’s bonding.

    JOHN. It’s called Facebook right?

    MIKE. Yeah, it is. I think some of us over share the ugly things too by the way. This isn’t like, just bare everything.

    JOHN. It’s not drama, it’s not things like that.

    MIKE. I think our responsibility is to be candid and authentic in who we are, because it will repulse certain people, but it will attract the right people. If we try to be this generic flavor, vanilla, and not share any of the interesting things, the intriguing things, some of the cooler things. If we don’t do that, as I said earlier, we become very replaceable. There are countless pints of vanilla out there, but there are only so many pistachios. t out that thing that makes you different, and you’ll find it’s very empowering.

    I noticed myself once I meet with someone, sit down and say, “I love to play guitar and I recently just bought a good guitar, but I’m not so financially sound that I didn’t buy from a knockout company.” He said, “what do you mean not financially sound?” It actually triggered into how incurred all this debt, and that’s quite a few years back now, but this was very few, many, years back when I was meeting with him, it was just after I came out of this angel of death situation.

    I think a lot of interesting stories come out of it and you empower that person you’re talking with to explore, or if that’s not where they’re comfortable, to ignore it, but it would never come out if I didn’t share it. I think, again, most people are, “no, let’s just talk business,” and that’s it. It’s just all surface and no depth.

    JOHN. Right, absolutely, yeah. It’s like a two dimensional transaction, surface to surface.

    MIKE. And it’s always replaceable, you’re just another X, Y, Z, it’s always replaceable. It’s a scary place.

    JOHN. That’s awesome man, and that’s pretty much, yeah. This was jam packed. This was fantastic, I don’t know if there are any other words of encouragement, or anything else you’d like to share before we move on to my super fast rapid fire questions.

    MIKE. I think the last thing is for everyone listening in to give yourself permission. I give you permission, John you give them permission, to show who you really are. It might not be what you’re doing now, explore new hobbies, test new things. I started a new mantra, I said I’ll do it only if it’s uncomfortable. I came up with this when I was with a couple people at this event a couple weekends back, and they said, “who wants to go surfing?” I don’t want to have a surfboard smash me in the face, I’ve never been on a surfboard before. I said, “I’m in,” and I said it before I even had a chance to think about it, and I sucked by the way, I did tombstone, but I explored a new potential hobby and a new part of myself. I encourage folks listening in, you have permission to explore new, and my words of encouragement are, try something uncomfortable.

    JOHN. Very cool. We’ve talked several times, but as far as coming, hanging out and watching football together, I have my test and it’s my 17 rapid fire questions.

    MIKE. Yeah.

    JOHN. Whether or not we should actually hang out together. Provided it’s not the Notre Dame/Virginia Tech game, everything else is good.

    JOHN. Cats or Dogs?

    MIKE. Dogs, hands down.[CHIME] I’ve had both, so I’m speaking from experience.

    JOHN. PC or a Mac?

    MIKE. PC [CHIME]

    JOHN. Right Click or Left Click?

    MIKE. Here’s the irony, left click.[CHIME] Everything is left handed, but I’m a right handed person.

    JOHN. I never even thought of that.

    MIKE. Not only am I a left click, I’m a vertical left click.

    JOHN. Since you made the ice cream reference earlier, what’s your favorite ice cream flavor?

    MIKE. Pistachio [CHIME], o I totally staged myself up for that.

    JOHN. There you go. Favorite place you’ve been on vacation?

    MIKE. Probably Hawaii,[CHIME] but I’ll tell you it’s a specific island called Lanai. It’s not the popular Island, in fact almost no one goes there. I think the population is 3,000 or 4,000 on the island. There is no resorts, no ride the big water slides sort of stuff, it’s just outdoors stuff. So, we hiked the island, ATV’d it, and it’s such a non populace island that you can go, you can find beaches where there is no one for miles and you can stay out there overnight.

    JOHN. That’s so peaceful.

    MIKE. And there is even an abandoned resort. They tried to make a resort there and they failed, so it’s abandoned.

    JOHN. I do remember hearing about that.

    MIKE. Yeah, Gilligan’s Island, I was just out there last year and it was so cool.

    JOHN. When it comes to financial statements, balance sheet or income statement?

    MIKE. Income statement.[CHIME] It’s funny, I still struggle to read a balance statement, and I’m in the industry. That’s why I created the system where you don’t need to read Balance Sheets, or Income Statements.

    JOHN. right, it’s the cash flow that throws me the curve ball. I’m like, yeah forget about it. Star Wars or Star Trek.

    MIKE. Star Wars.[CHIME]

    JOHN. Sudoku or Crossword Puzzle.

    MIKE. Sudoku, I’m kind of into the math stuff and words are not my strength.

    JOHN. Says the man who wrote five books. Favorite color?

    MIKE. Blue,[CHIME] but isn’t that for everybody?

    JOHN. Well it should be, I agree. If it’s not you’re wrong. Kidding. How about a least favorite color?

    MIKE. Neon pink or something,[CHIME] just not into that.

    JOHN. Early Bird or Night Owl?

    MIKE. Early, early, early bird.[CHIME] So I went to bed last night at 9, woke up at 4:30, but that’s not typical. Typically I get up at 5:15 every morning, but I go to bed by 9:30 or 10.

    JOHN. How about a favorite number?

    MIKE. 5.

    JOHN. Is there a reason?

    MIKE. It was my Lacrosse number in college, and I always liked 5 as a kid.

    JOHN. 5 is your thing. Since you are a guitarist, favorite band or musician?

    MIKE. Death Leper, Pyromania, Hysteria, those two albums are my favorite [CHIME].

    JOHN. How about a favorite actor or actress?

    MIKE. No one.[BUZZ] I saw recently, Jason Bateman, he’s a little bit of a character actor, he was on Arrested Development.

    JOHN. Yeah, he’s really funny too.

    MIKE. I think he’s just, he’s able to pull across business guy kind of no one likes kind of guy. He plays certain characters so well and I admire that.

    JOHN. Yeah, quite an actor, that’s for sure. As an author do you prefer Kindle or real books?

    MIKE. Six months ago I was real books, but one day I was like, “I can’t carry all these real books in my bag.” So I went all in on Kindle. I already had it, but I went all in about six months ago, and now I’m like, “Kindle is the best thing ever.”[CHIME]

    JOHN. Such an early adopter.

    MIKE. I know, I know.

    JOHN. I’m the same way man. Last one, the favorite thing you own, or the favorite thing you have.

    MIKE. I’m really starting to lose any interest in material possessions. I just got this today, so maybe this will be my new temporary favorite. I just got the Amazon Echo, the thing where you can request music by just saying, “hey I want to hear Van Halen.”

    JOHN. The small tower that just kind of sits there?

    MIKE. Yeah. I just got it today, I haven’t even used it yet, so that may become my new favorite thing.[CHIME]

    JOHN. That’s awesome man. Thank you so much Mike, this was really good, thank you for being on the Green Apple Podcast.

    MIKE. Thank you John.


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