Latest / The David Rubenstein Show / John Mackey

Transcript

John Mackey · The David Rubenstein Show

• 0:00
  Speaker 1: This is Bloomberg Best. Bloomberg Best is about the insight
• 0:04
  Speaker 1: and the context that we get from our guests. It's
• 0:06
  Speaker 1: a great way to catch up on some of the
• 0:07
  Speaker 1: stories you might have missed on the Bloomberg stories you're
• 0:10
  Speaker 1: not going to find in any other news organizations. Bloomberg
• 0:14
  Speaker 1: Best Bloomberg's Best stories of the week, powered by twenty
• 0:18
  Speaker 1: seven hundred journalists and ennalysts in more than a hundred
• 0:21
  Speaker 1: twenty countries around the world. I met Baxter and I'm
• 0:24
  Speaker 1: Denease Pelly Green. On this weekend edition of Bloomberg Best.
• 0:28
  Speaker 1: I had my food awakening where I really understood for
• 0:32
  Speaker 1: the first time that what you a affected how you felt.
• 0:35
  Speaker 1: John McKee, CEO of All Foods, asked my girlfriend living
• 0:39
  Speaker 1: in the cow off whe her we ought to start
• 0:41
  Speaker 1: up our own little store, and she said she thought
• 0:44
  Speaker 1: that would be a lot of fun cool the birth
• 0:47
  Speaker 1: of the nation's biggest natural foods change turned out there
• 0:51
  Speaker 1: it wasn't just selling food to hippies, and how it
• 0:53
  Speaker 1: turned out to be so much bigger. All this and
• 0:57
  Speaker 1: more coming up in the next hour of Bloomberg Best.
• 1:02
  Speaker 1: All right, I want to get right to it, because
• 1:04
  Speaker 1: what a story let's go back now to Austin, Texas. Yeah,
• 1:12
  Speaker 1: and David Rubinstein asked John Mackie what propelled him to
• 1:15
  Speaker 1: start Safer Way and then Whole Foods after dabbling at
• 1:19
  Speaker 1: being a college student. And here's what Mackie said on
• 1:22
  Speaker 1: the David Rubinstein Show Peer to Peer Conversations. What propelled
• 1:26
  Speaker 1: you to start Safer Way and then Whole Foods. I mean,
• 1:28
  Speaker 1: you were at the University of Texas, and did you
• 1:30
  Speaker 1: drop out to do this? I dropped out of school
• 1:33
  Speaker 1: like six times. I've got a hundred twenty hours of electives.
• 1:36
  Speaker 1: I just study whatever I was interested in. But I
• 1:38
  Speaker 1: did not drop out to start this company. I was
• 1:41
  Speaker 1: living in a vegetarian co op when I was twenty
• 1:44
  Speaker 1: three years old, and that's when I had my food awakening,
• 1:48
  Speaker 1: where I really understood for the first time that what
• 1:51
  Speaker 1: you ate affected how you felt and your health and
• 1:55
  Speaker 1: your longevity. And then I became the food buyer at
• 1:58
  Speaker 1: that co op. And then I went to work for
• 2:01
  Speaker 1: a small natural food store in Austin, and I had
• 2:03
  Speaker 1: found the purpose of my life. I was on fire
• 2:05
  Speaker 1: for healthy eating, organic and natural foods. Came home one
• 2:09
  Speaker 1: day and asked my girlfriend living in the co op
• 2:12
  Speaker 1: whetherr we ought to start up our own little store,
• 2:15
  Speaker 1: and she said she thought that would be a lot
• 2:17
  Speaker 1: of fun. Cool and uh. Six months later, we'd raised
• 2:22
  Speaker 1: forty dollars from friends and family and we found a location,
• 2:26
  Speaker 1: a small store location in Austin, and we were in business.
• 2:29
  Speaker 1: So when you started the company, though, did you have
• 2:32
  Speaker 1: the vision of building a global or national company or
• 2:35
  Speaker 1: did you just say I'll do a couple of stores.
• 2:36
  Speaker 1: What was your original vision? Original vision was to break even.
• 2:41
  Speaker 1: We were losing the month when we started out. The
• 2:44
  Speaker 1: first year, we raised forty dollars in capital. We managed
• 2:47
  Speaker 1: to lose twenty three thousand of it, so we were
• 2:49
  Speaker 1: lucky to survive. We did much better in the second year,
• 2:53
  Speaker 1: relocated two Whole Foods. No, we had no grand vision.
• 2:56
  Speaker 1: The best way to understand it is we were just
• 2:59
  Speaker 1: passion and about selling natural, organic foods. There was no
• 3:03
  Speaker 1: we weren't. We weren't. We didn't take any business classes.
• 3:07
  Speaker 1: We we didn't have we weren't NBA's. We just were passionate.
• 3:11
  Speaker 1: We were on five. We were young. I was twenty
• 3:13
  Speaker 1: four years old when we started the first store. Renee
• 3:15
  Speaker 1: was twenty, so we were just having an adventure. We
• 3:19
  Speaker 1: were we were playing and having a grocery store. It
• 3:21
  Speaker 1: was so much fun. And then and then we started
• 3:24
  Speaker 1: learning business and we've got pretty good at it, and
• 3:26
  Speaker 1: then we started to grow it. I will tell you
• 3:28
  Speaker 1: a story, David. So when we did our I p O.
• 3:31
  Speaker 1: You know, one of the things that the investors want
• 3:34
  Speaker 1: to know. They're trying to build a model of your company,
• 3:36
  Speaker 1: so they want to know what's the potential. How big
• 3:38
  Speaker 1: could it be. We had twelve stores when we I
• 3:41
  Speaker 1: p O. And I thought, I think we could sunday
• 3:44
  Speaker 1: have a hundred stores, and uh, you know, we might
• 3:47
  Speaker 1: even someday, we might even be able to do maybe
• 3:50
  Speaker 1: maybe a billion dollars in sales. Someday someday we could
• 3:52
  Speaker 1: have that. And they weren't. They weren't that impressed with that.
• 3:55
  Speaker 1: They didn't think that was gonna be that bigger company.
• 3:58
  Speaker 1: And of course, you know, we're doing twenty billion in
• 4:00
  Speaker 1: sales now, I would have five twenty stores or thereabouts.
• 4:04
  Speaker 1: So I was very wrong about the upward potential of
• 4:07
  Speaker 1: the business at the time. Um, when you were doing
• 4:10
  Speaker 1: this in seventy eight. In the early eighties was natural
• 4:14
  Speaker 1: food and well known as what natural food was organic foods.
• 4:17
  Speaker 1: What what we're what weren't the view of them. Then
• 4:20
  Speaker 1: when we were trying to raise venture capital money, I
• 4:22
  Speaker 1: mean only we had three venture capitalists and invested, and
• 4:26
  Speaker 1: we had a dozen or more turned this down. And
• 4:29
  Speaker 1: I remember one of the guys turning me down saying, yeah,
• 4:32
  Speaker 1: I don't think this business has much of a future.
• 4:34
  Speaker 1: I don't know why he felt so motivated to tell
• 4:36
  Speaker 1: me why he wasn't going to invest, because usually they
• 4:38
  Speaker 1: just say we're not interested. But he said, I want to.
• 4:40
  Speaker 1: I want to explain to you. And he said, you
• 4:42
  Speaker 1: guys are just a bunch of hippies and you're selling
• 4:45
  Speaker 1: food to other hippies. I ran into that guy like
• 4:48
  Speaker 1: eight years later. He told me that was the biggest
• 4:50
  Speaker 1: mistake he'd ever made in his venture capital career. Turned
• 4:54
  Speaker 1: out that it wasn't just selling food to hippies, that
• 4:57
  Speaker 1: it caught on in the in the upper middle class
• 5:00
  Speaker 1: US and then and then it spread from there and
• 5:02
  Speaker 1: and uh and yeah, the rest is history. As I say, So,
• 5:05
  Speaker 1: when you dropped out of college, did you say to
• 5:07
  Speaker 1: your father, I'm gonna be like Mark Zuckerberg er Bill Gates,
• 5:12
  Speaker 1: and I'm gonna build a big company, and did he
• 5:13
  Speaker 1: have a lot of confidence in here to do that? Well.
• 5:15
  Speaker 1: Mark Zuckerberg wasn't alive when I started the company. Saw
• 5:19
  Speaker 1: he wouldn't have referred to him. And Bill Gates was
• 5:21
  Speaker 1: just started Microsoft two years before I started a safer way,
• 5:24
  Speaker 1: so my dad had never heard about UM. My dad
• 5:28
  Speaker 1: was very supportive. Uh. He he was just wanted his
• 5:31
  Speaker 1: son to do something. He was passionate about that. I
• 5:34
  Speaker 1: really he could see I was very excited about this.
• 5:36
  Speaker 1: So he was actually very supportive. In the early years,
• 5:39
  Speaker 1: he helped you somewhat as an accounting professor. He gave
• 5:41
  Speaker 1: you some advice. My dad was my mentor. Uh, since
• 5:45
  Speaker 1: I didn't have that business background. I always say that
• 5:48
  Speaker 1: from the year of nineteen seventy eight to nineteen ninety four,
• 5:51
  Speaker 1: I never made a move at Whole Foods without checking
• 5:53
  Speaker 1: with my dad. In nineteen four, I turned forty years old,
• 5:58
  Speaker 1: and uh, we'd gone public two years before, and my
• 6:02
  Speaker 1: dad was now wealthy, you know, on pay per pose
• 6:04
  Speaker 1: with the wholefing stock that he had bought, and he
• 6:07
  Speaker 1: wanted to hold onto what he had, and I wanted
• 6:10
  Speaker 1: to grow the business. I just saw, we can really
• 6:12
  Speaker 1: grow this thing. And so we had to. We used
• 6:15
  Speaker 1: to fighting our board meetings. We were screaming each other
• 6:17
  Speaker 1: at public board meetings. And finally I said, Dad, here,
• 6:20
  Speaker 1: here's what I want you to do. I want you
• 6:21
  Speaker 1: to sell half of your stock tomorrow. I'm firing. I
• 6:24
  Speaker 1: don't want you on the board anymore. I want you
• 6:26
  Speaker 1: to sell half your stock tomorrow and take the other
• 6:29
  Speaker 1: half and leave it in the company because we're gonna
• 6:31
  Speaker 1: grow Whole Foods. It's gonna be a big enterprise someday.
• 6:34
  Speaker 1: So he did that, very took my advice, sould half
• 6:36
  Speaker 1: the stock the next day. He was very hurt. His
• 6:38
  Speaker 1: feelings were hurt. I remember him telling me. I said,
• 6:41
  Speaker 1: I'm forty years old. I'm ready to run the company
• 6:43
  Speaker 1: by myself without you, And he said, forty years old.
• 6:47
  Speaker 1: You don't know anything. You're only forty, you know. It
• 6:51
  Speaker 1: turned out he was right. I didn't know very much
• 6:53
  Speaker 1: when I was forty. I know a lot more today
• 6:54
  Speaker 1: and I knew then. But he was wrong about the
• 6:57
  Speaker 1: potential growth of Whole Foods because the company took up
• 7:00
  Speaker 1: after that, and he made a lot more money on
• 7:02
  Speaker 1: that half that he kept in. So when you're growing
• 7:05
  Speaker 1: the company and making it a national company in a
• 7:07
  Speaker 1: well known brand. Was the biggest problem that people still
• 7:10
  Speaker 1: weren't convinced that natural foods and organic foods were good
• 7:13
  Speaker 1: for you. Was it that the price you had to
• 7:15
  Speaker 1: charge was somewhat more expensive than that's a safe way,
• 7:19
  Speaker 1: or was it the safe ways of the world that
• 7:20
  Speaker 1: we're gonna compete with you and they were gonna have
• 7:21
  Speaker 1: organic foods, or it was just getting cash from investors
• 7:24
  Speaker 1: to help you grow. What were the biggest problems. The
• 7:27
  Speaker 1: biggest problem was the limitation of the marketplace. Initially because
• 7:32
  Speaker 1: it's a consciousness thing. So if when we opened up
• 7:36
  Speaker 1: in a hip area where he had a lot of uh,
• 7:41
  Speaker 1: younger sort of counterculture people the store or bohemian people,
• 7:44
  Speaker 1: the stores would take off from the very beginning. But
• 7:47
  Speaker 1: we when we went into suburb, like when we opened
• 7:50
  Speaker 1: a store in in Greenville Avenue in Dallas, it took off.
• 7:54
  Speaker 1: But when we went up to Richardson, a suburb North Dallas.
• 7:57
  Speaker 1: Back this, it was really slow. The stores started really slow.
• 8:02
  Speaker 1: The suburban stores just didn't have enough what we'd call
• 8:05
  Speaker 1: natural food consciousness to really be successful. It took us
• 8:09
  Speaker 1: years to grow those those businesses. Now, when whole Foods
• 8:14
  Speaker 1: came along and it was very popular in many areas.
• 8:16
  Speaker 1: It became known in some circles as whole paychecked. I'm
• 8:19
  Speaker 1: sure you've heard that before, and so that the implication
• 8:23
  Speaker 1: was that your prices were expensive. But um, I assume
• 8:26
  Speaker 1: that your responses. But you're selling higher quality or more
• 8:29
  Speaker 1: complicated things, and your prices are not a big drag
• 8:33
  Speaker 1: on your overall ability to get people to come into
• 8:35
  Speaker 1: the store. Is that right. It's a it's a very
• 8:38
  Speaker 1: good question, of course, I do hear that all the time,
• 8:40
  Speaker 1: and it's it's it's a little bit of a complex answer.
• 8:43
  Speaker 1: So for most of our history, in the forty year history,
• 8:48
  Speaker 1: we probably only got serious competition in the last fifteen years.
• 8:51
  Speaker 1: So the first twenty five years we existed, very few
• 8:54
  Speaker 1: people sold the same products that we sold, so um,
• 8:58
  Speaker 1: there was no big deal. But then as we got
• 9:00
  Speaker 1: more successful, we got more competition. And one of the
• 9:04
  Speaker 1: ways they competed with us was to undercut us in price.
• 9:07
  Speaker 1: And of course, one of the things Whole Foods knows
• 9:09
  Speaker 1: it needs to do is it needs to meet the
• 9:10
  Speaker 1: competitive marketplace in terms of price, and that is one
• 9:14
  Speaker 1: of the reasons we wanted to merge or sell the
• 9:16
  Speaker 1: Amazon is. Jeff and his team think long term. So
• 9:21
  Speaker 1: it was gonna be very difficult for us to lower
• 9:24
  Speaker 1: our prices and hold on to our company because it
• 9:27
  Speaker 1: was when you lower prices initially, it actually hurts your
• 9:30
  Speaker 1: sales and hurt your profitability. Something you were selling for
• 9:33
  Speaker 1: a dollar now you're selling for ninety cents, So it
• 9:35
  Speaker 1: looks like your business is declining. Now you'll get it
• 9:38
  Speaker 1: back over time as people realize that they get better prices.
• 9:42
  Speaker 1: But it's a painful transition. Now with Amazon, we've already
• 9:45
  Speaker 1: dropped our prices three times and we're gonna keep dropping them,
• 9:49
  Speaker 1: so Amazon is, and that that's another great benefit of
• 9:51
  Speaker 1: the merger for us. We are getting more and more
• 9:53
  Speaker 1: price competitive, and Amazon is willing to be patient and
• 9:56
  Speaker 1: let that play out over time. So a couple of
• 10:00
  Speaker 1: years ago, you had, as you wrote in your in
• 10:03
  Speaker 1: your book on Conscious Leadership, I hedge fund, kind of
• 10:06
  Speaker 1: an activist Hedge fund came along and they were agitating
• 10:09
  Speaker 1: for a higher price, and ultimately you looked at some
• 10:12
  Speaker 1: about alternatives and one of them that seemed the best
• 10:14
  Speaker 1: was selling the Amazon. Is that right, that's correct. We
• 10:17
  Speaker 1: had the activists Investor's Janna partners wanted to. I met
• 10:22
  Speaker 1: with them and they basically said, we're gonna take over
• 10:25
  Speaker 1: your board and and we're gonna throw you out. We're
• 10:28
  Speaker 1: gonna sell the company, So why don't you just save
• 10:30
  Speaker 1: us all a lot of a lot of anguish and
• 10:33
  Speaker 1: just let's just agree to do that. So, of course
• 10:37
  Speaker 1: we we didn't want to sell the company uh to
• 10:40
  Speaker 1: the highest bidder, and we had to think about our
• 10:42
  Speaker 1: different alternatives. So one was going private potentially. Another one
• 10:46
  Speaker 1: was to put the company in friendly hands like we
• 10:49
  Speaker 1: contacted Warren Buffett for example. Another one was to maybe
• 10:53
  Speaker 1: fight Janna and fight to maintain control. And then as
• 10:58
  Speaker 1: I was trying to think about what the best solution
• 11:00
  Speaker 1: and was, one morning I woke up. I just woke
• 11:02
  Speaker 1: up and it popped in my brain, what about Amazon?
• 11:06
  Speaker 1: What about Amazon? I've met Jeff a year before, really
• 11:09
  Speaker 1: admired him, still do. I thought these guys would be perfect.
• 11:15
  Speaker 1: I've heard they want to get into grocery business. This
• 11:17
  Speaker 1: would be a good opportunity for them to get into it.
• 11:20
  Speaker 1: Their technology could help Aul foods. So we contacted Amazon.
• 11:25
  Speaker 1: A couple of days later, we flew up to Seattle
• 11:27
  Speaker 1: and met with Jeff and his team. We had an
• 11:30
  Speaker 1: amazing first conversation lasted about three hours. It was like
• 11:34
  Speaker 1: we were finishing each other sentences, all the things we
• 11:36
  Speaker 1: could do together. We got super excited. Just a few
• 11:40
  Speaker 1: days after that, they sent a whole team to Austin
• 11:42
  Speaker 1: to continue the conversations. Six weeks after that first meeting,
• 11:46
  Speaker 1: we signed a merger agreement. We negotiated the price, signed
• 11:49
  Speaker 1: the mergery agreement, and and we were we were on
• 11:52
  Speaker 1: our way. So every acquisition looks great at the time
• 11:55
  Speaker 1: you do him. Now you've had a couple of years
• 11:57
  Speaker 1: behind you. Is it working out? And are you happy
• 11:59
  Speaker 1: with you know? The metaphor I like to use for
• 12:02
  Speaker 1: a merger is it's uh, it's like a marriage, particularly
• 12:06
  Speaker 1: between big companies. So we had to love at first
• 12:09
  Speaker 1: sight in a whirlwind romance. It's a fair question to ask,
• 12:12
  Speaker 1: how's that working out now? It's about three years later now,
• 12:15
  Speaker 1: as a matter of fact, and is it perfect? You know? No,
• 12:20
  Speaker 1: It's like I I sometimes say when people ask me
• 12:22
  Speaker 1: this question, I said, you know, do I love absolutely
• 12:25
  Speaker 1: everything about my wife? I've been I've been married thirty
• 12:27
  Speaker 1: years and the answer is no, I love about nine percent.
• 12:32
  Speaker 1: But it's two percent that you know it really bothers me,
• 12:35
  Speaker 1: And I'd say it's kind of similar with Amazon. Do
• 12:37
  Speaker 1: we love everything about Ama? There's about two percent we
• 12:39
  Speaker 1: know love, but we love almost everything. Is pretty good.
• 12:42
  Speaker 1: That's a pretty good marriage. And in Amazon, the merger
• 12:45
  Speaker 1: is working out great for us. We're a much better
• 12:47
  Speaker 1: company today than we were pre Amazon. So Amazon is
• 12:51
  Speaker 1: about getting people to buy things and ship into their home.
• 12:55
  Speaker 1: You've been about getting people to come into your stores
• 12:57
  Speaker 1: and buy a lot of things that they might see
• 12:59
  Speaker 1: while they're walking around. So is that a different kind
• 13:02
  Speaker 1: of culture and how has it worked out in that respect?
• 13:04
  Speaker 1: There's overlapping the cultures. We're both very customer focused. There
• 13:09
  Speaker 1: are difference in cultures. But one of the things that
• 13:11
  Speaker 1: Amazon has done, which has been fantastic and one reason
• 13:14
  Speaker 1: the mergers worked well, they respect our culture. They're not
• 13:18
  Speaker 1: trying to change our culture. Now our culture is changing
• 13:22
  Speaker 1: because we're taking on lots of attributes that Amazon has
• 13:26
  Speaker 1: and that has a change in our culture. But they're
• 13:28
  Speaker 1: not forcing us to coercing us. We're doing it voluntarily
• 13:32
  Speaker 1: to make our company better. So that's why we're evolving.
• 13:37
  Speaker 1: But I think in a healthy constructive way. People ask me, hey, John,
• 13:41
  Speaker 1: if you could do it all over again, would you
• 13:42
  Speaker 1: make the same decision, And the answers, yes, we make
• 13:45
  Speaker 1: the exact same decision. So I know, whenever I go
• 13:47
  Speaker 1: to Whole Foods, which is about a mile from my house,
• 13:49
  Speaker 1: and I go there very frequently, they always asked me,
• 13:52
  Speaker 1: are you a Prime Member? So it's being Prime helped
• 13:54
  Speaker 1: a lot in your business. The Prime Membership club. High
• 13:59
  Speaker 1: percentage of our custom as our Prime members, and so
• 14:01
  Speaker 1: they like that. Now there is a minority of customers
• 14:04
  Speaker 1: who are not and and of course every time they
• 14:06
  Speaker 1: get asked with their prime member, of course they don't
• 14:08
  Speaker 1: necessarily like that. They keep, you know, getting asked that question. Um.
• 14:13
  Speaker 1: But on balance, remember the majority of our transactions are
• 14:18
  Speaker 1: coming from Prime members, so that's been that's been a
• 14:20
  Speaker 1: good thing for them. They're getting better prices and better deals.
• 14:24
  Speaker 1: The main way Amazon's health Toll Foods though, is technology.
• 14:27
  Speaker 1: I mean, particularly now with Covid, the amount of deliveries
• 14:32
  Speaker 1: that we're doing and pick up store pickups and deliveries,
• 14:35
  Speaker 1: I mean it's triple in the last year. I mean,
• 14:37
  Speaker 1: we're doing a large percentage of our business online now
• 14:41
  Speaker 1: and we didn't really have a small percentage before Amazon
• 14:45
  Speaker 1: acquired US. So let's talk about COVID for a moment um.
• 14:48
  Speaker 1: And COVID came, many people are worried that retail stores
• 14:52
  Speaker 1: would have to shut down, but actually food retail stores
• 14:55
  Speaker 1: have benefit, and you could argue because people need to
• 14:57
  Speaker 1: eat a lot more, I guess, or at least to
• 14:59
  Speaker 1: going to the buy staples. What was it like to
• 15:01
  Speaker 1: manage under COVID at the outset. So the main thing
• 15:04
  Speaker 1: to understand is almost all food retailer sales are up,
• 15:07
  Speaker 1: primarily because restaurants sales are down so much. Right, people
• 15:11
  Speaker 1: aren't eating out as much, so they're eating at home
• 15:13
  Speaker 1: more and that's been good for pretty much all food retailers.
• 15:17
  Speaker 1: That's been good for whole foods as well. Maybe a
• 15:19
  Speaker 1: little bit less good for us because we do a
• 15:21
  Speaker 1: lot of prepared foods in our stores, and so that's
• 15:23
  Speaker 1: way down. People are not going to our salad bars,
• 15:26
  Speaker 1: are hot food bars, they're they're not going in our
• 15:30
  Speaker 1: offices are shut down around our stores, so we're not
• 15:32
  Speaker 1: getting that traffic that we used to get in. But
• 15:36
  Speaker 1: on the other hand, overall sales are up substantially because
• 15:39
  Speaker 1: everything else is up so much as it made the
• 15:41
  Speaker 1: way you're going to manage in the future different. Again,
• 15:44
  Speaker 1: it helps us tremendously for being online sales and so
• 15:48
  Speaker 1: and that will continue. I don't well ever, when we
• 15:50
  Speaker 1: won't go back to Once people get a taste of that,
• 15:53
  Speaker 1: they like it in Amazon if you're Prime member, delivery
• 15:56
  Speaker 1: is free. So I think that's gonna be a permanent
• 15:59
  Speaker 1: shift for many people. You know. The hardest thing about
• 16:03
  Speaker 1: managing the business now it's it's there's an element of fear.
• 16:07
  Speaker 1: Right people are scared of the virus. Everybody's masked up.
• 16:11
  Speaker 1: We would require mask for all of our team members
• 16:14
  Speaker 1: and all customers in those masks. If you're I'm in Austin.
• 16:17
  Speaker 1: It's a hundred degrees outside right now and we're in
• 16:19
  Speaker 1: a mask around is not not very fun or pleasant
• 16:22
  Speaker 1: thing to do. Um and people have been shut down
• 16:26
  Speaker 1: in their homes and that's you know, we see what's
• 16:28
  Speaker 1: happening is unrest around the country. So it's been a
• 16:31
  Speaker 1: hard This is this is I don't know about you,
• 16:33
  Speaker 1: but I'd have to say is the weirdest year of
• 16:36
  Speaker 1: my entire life. When you go to a Whole Foods
• 16:38
  Speaker 1: anywhere in the country, you have at five hundred stores
• 16:40
  Speaker 1: or so in the country. Now, I assume you're instantly
• 16:43
  Speaker 1: recognized to have a picture of you there when you
• 16:45
  Speaker 1: walk in, so they know who you are. Now I
• 16:47
  Speaker 1: go in, I'm wearing a mask, nobody knows who I am.
• 16:49
  Speaker 1: I'm I'm gonna have a perfect disguise, but no, they've
• 16:52
  Speaker 1: recognized me, mostly because they know I'm coming. Generally, I
• 16:56
  Speaker 1: do some surprises, it's occasionally, and it's just I get
• 17:00
  Speaker 1: recognized very quickly. So when you go in and you
• 17:02
  Speaker 1: if you say, well, this is not set up the
• 17:04
  Speaker 1: right way, or you should charge something different, that they
• 17:06
  Speaker 1: listen to you. You know what I've learned, David, I've
• 17:08
  Speaker 1: learned painfully that, uh, whether I like it or not,
• 17:11
  Speaker 1: I'm the father of Whole Foods, and the team members
• 17:15
  Speaker 1: really want Dad to love the story. So I've learned
• 17:18
  Speaker 1: to to sort of moderate my criticisms because they really
• 17:22
  Speaker 1: tried to make the store look good because he knew
• 17:24
  Speaker 1: I was coming. So I just try to stay positive
• 17:27
  Speaker 1: and connect with the people, and then maybe after I leave,
• 17:31
  Speaker 1: I will tell the the leadership of the region, I
• 17:34
  Speaker 1: didn't like this, this or this. You've built one of
• 17:36
  Speaker 1: the most famous companies in the United States. But you don't.
• 17:40
  Speaker 1: You don't own a lot of it relative to what
• 17:42
  Speaker 1: some of the other founders of large companies have done.
• 17:43
  Speaker 1: It does that make you, uh, lose sleep at night
• 17:46
  Speaker 1: or you're okay with that? You know something I learned
• 17:49
  Speaker 1: pretty early in life. One of the most destructive emotions
• 17:53
  Speaker 1: there is in the world is envy. Envy will poison
• 17:56
  Speaker 1: your soul. I learned to deal with envy of people
• 18:00
  Speaker 1: envying me, and I learned to deal with my own
• 18:02
  Speaker 1: envy a long time ago. And it's far better to
• 18:06
  Speaker 1: to just be grateful. I've had an amazing life. I
• 18:10
  Speaker 1: am a very wealthy man by any objective standard. So
• 18:13
  Speaker 1: other people wealthier than me. There are other entrepreneurs have
• 18:16
  Speaker 1: made more money. So what I mean? I have everything
• 18:19
  Speaker 1: I need or could ever want. So agreed, and those
• 18:22
  Speaker 1: things poison our souls, and so I have. There's no
• 18:26
  Speaker 1: place for envy. I am happy for them. I'm happy
• 18:29
  Speaker 1: that they've had successful lives, and uh, yeah, so have I.
• 18:33
  Speaker 1: Life is good. In your book, you talk about the
• 18:35
  Speaker 1: importance of a certain type of leadership where you are
• 18:38
  Speaker 1: trying to be what you call a conscious leader, which
• 18:41
  Speaker 1: is to say, worry about long term purpose of a company,
• 18:44
  Speaker 1: not just profit. Is that right? Yes, I mean in
• 18:48
  Speaker 1: the book we talked about purpose first. Put purpose first.
• 18:53
  Speaker 1: That that Whole Foods has always been purpose driven since
• 18:56
  Speaker 1: the very beginning. We always um, you know, wanted to
• 19:00
  Speaker 1: make the world a better place and natural organic foods.
• 19:02
  Speaker 1: You want to people lead healthy. And then what we
• 19:06
  Speaker 1: learned over time is the importance of leading with love,
• 19:09
  Speaker 1: to care about your people. And so we have a
• 19:12
  Speaker 1: chapter about leading with love. And then we learned, of
• 19:14
  Speaker 1: course the importance of integrity in business, in life in general.
• 19:18
  Speaker 1: Integrity is so important. You have to be you have
• 19:21
  Speaker 1: to do what you say. You have to be trustworthy,
• 19:23
  Speaker 1: you have to be authentic, you have to be honorable,
• 19:25
  Speaker 1: you have to have honor. When you talk a lot
• 19:27
  Speaker 1: about the importance of culture and having a certain culture,
• 19:29
  Speaker 1: you developed the Whole Foods culture. Has it changed under
• 19:32
  Speaker 1: Amazon or you've been able to keep your culture? And
• 19:35
  Speaker 1: what is that culture? Well, cultures are like living there
• 19:38
  Speaker 1: like they're like living entities, and they change over time.
• 19:43
  Speaker 1: They evolve. So yes that at mergers three years ago,
• 19:47
  Speaker 1: our culture has evolved in the last three years. But
• 19:50
  Speaker 1: culture comes from your values, it comes from your purpose.
• 19:54
  Speaker 1: And it comes from the way you lead the company,
• 19:56
  Speaker 1: what your leadership principles are. So Whole Foods cause of
• 19:59
  Speaker 1: very healthy culture. We were named one of the Hunter
• 20:01
  Speaker 1: Best Companies to work for for twenty consecutive years, and
• 20:05
  Speaker 1: our culture is still very healthy. I will say Covid
• 20:07
  Speaker 1: is challenging the culture. For one thing. We can't get
• 20:10
  Speaker 1: around and visit the store so easily right now, So
• 20:13
  Speaker 1: more stores are kind of on their own than ever before.
• 20:16
  Speaker 1: And and we're to mask every day is stressful for people,
• 20:19
  Speaker 1: and and so there's a lot of fear. And we're
• 20:22
  Speaker 1: in urban areas, and there have been a lot of
• 20:23
  Speaker 1: protests this summer. It's a it's a restless world out
• 20:26
  Speaker 1: there right now. You've been the CEO of this company
• 20:29
  Speaker 1: for forty two years. UM. Very few people are CEO
• 20:33
  Speaker 1: so have publicly traded companies or companies as large as
• 20:35
  Speaker 1: yours for that long. Is it your expectation to do
• 20:38
  Speaker 1: this another five, ten, fifteen years? Or what else might
• 20:41
  Speaker 1: you do? Would you go into government, would you run
• 20:42
  Speaker 1: for office? Would you what else would you do? I
• 20:45
  Speaker 1: will not run for office and I will not go
• 20:47
  Speaker 1: into governments. Think about it this way. Whole Foods is like,
• 20:50
  Speaker 1: I don't have biological children, so Whole Foods is like
• 20:55
  Speaker 1: it's for me. It's the equivalent of my child. It's
• 20:57
  Speaker 1: kind of grown up now, right, it's a it's not
• 20:59
  Speaker 1: a Mayby anymore. But parents love their children their whole lives,
• 21:03
  Speaker 1: even when they're grown up. Um, I will leave Whole
• 21:06
  Speaker 1: Foods sometime in the next few years, but I haven't
• 21:10
  Speaker 1: announced the retirement date yet. And Covid, I'm you know,
• 21:14
  Speaker 1: Covid is it's a crisis, Like I'm dealing with the
• 21:17
  Speaker 1: crisis here for that and uh uh I always make
• 21:21
  Speaker 1: this joke that it's like, Whole Fridge is my daughter,
• 21:24
  Speaker 1: and I literally married my daughter off to the richest
• 21:26
  Speaker 1: man in the world, and uh, I just kind of
• 21:29
  Speaker 1: came along to to make sure the marriage settled in well.
• 21:32
  Speaker 1: And I've I'm still here, but I know that the
• 21:36
  Speaker 1: time will come eventually for me to leave. It's just
• 21:38
  Speaker 1: not yet and I'm not quite sure when it will be.
• 21:40
  Speaker 1: So what I tell people all the time is the
• 21:42
  Speaker 1: hardest thing in life is to be happy. Happiness is
• 21:44
  Speaker 1: the most elusive thing in life. And you seem like
• 21:47
  Speaker 1: a very happy person. The secret to happiness is gratitude, right,
• 21:51
  Speaker 1: you wrote that in your book, Yes, gratitude, and it
• 21:54
  Speaker 1: was like you asked me that question earlier about you know,
• 21:58
  Speaker 1: how do you feel you could have made a lot
• 21:59
  Speaker 1: more money as big as your corporation is. Other encouragement,
• 22:01
  Speaker 1: more money any poisons happiness. Gratitude is the key. And
• 22:07
  Speaker 1: I'm grateful for what I have, not envious for what
• 22:09
  Speaker 1: I don't have. I mean, I have good health, I
• 22:12
  Speaker 1: have an amazing marriage, I have great friends. I have
• 22:15
  Speaker 1: this amazing business that I'm part of. I have materially
• 22:18
  Speaker 1: and financially everything I'll ever need. Life is blessing. It's
• 22:22
  Speaker 1: I'm just so happy to be alive. It's an amazing
• 22:25
  Speaker 1: life is beautiful and amazing. And I'm just grateful every
• 22:28
  Speaker 1: day and I get up happy to be alive. And
• 22:31
  Speaker 1: and uh so there you there you have that's my game.
• 22:35
  Speaker 1: Well you should bottle that and put that in your
• 22:37
  Speaker 1: and your stores. If I could bottle that, I would
• 22:39
  Speaker 1: be a billionaire. You've been listening to John Mackie, CEO
• 22:43
  Speaker 1: at Whole Foods on the David Rubinstein Show peer to
• 22:46
  Speaker 1: peer conversations. And that's it for this hour of Bloomberg Best.
• 22:50
  Speaker 1: I'm at Baxter and I'm Denny Spelton. This is Bloomberg.