← Coffeez with Joe Shalaby
Coffeez with Joe Shalaby
Transforming Retail & Entertainment ft. James W. Keyes | Coffeez for Closers with Joe Shalaby Ep. 63
00:45:31
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Foreign.
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What's up, everybody? And welcome to another episode of Coffees for Closers. Today we're sitting with a legend, an absolute powerhouse for all of you. Our guest is a seasoned C suite executive who has held top leadership positions in two of America's most iconic brands. He led the modernization of 711 during his tenure as CEO, overseeing a major transformation that extended product offerings and improved operations globally. Later, he took the helm of Blockbuster during a critical time in the company's history. His experience spans retail, entertainment, entrepreneurship, and today, we're excited to dive deep into his insights. Join us as we introduce to you the one, the only, legendary Jim Keys.
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Literally every day is a new adventure. I never know where I'm gonna be, what I'm gonna do, what next adventure is on the horizon. And I. I truly have no routine now. If I'm at home, I try to, you know, hit the gym. The first thing, the basics, right?
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Yeah.
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But on the road, you just never know.
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How often are you on the road?
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About 50% of the time.
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50% of your life is spent on the road.
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Yeah. Quite a bit. Quite a bit. Especially since launching the book.
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Yeah. And how. Let's talk about the book. Education is freedom. The future's in your hand. And I know you did a tour with Mr. Beast on that, right?
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Yeah. I was. I was really fortunate to have Mr. Beast philanthropy reach out. And they were doing a. A program with Ron Clark Academy over in Atlanta.
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Okay.
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800 teachers in to help them. Jimmy Donaldson's done some amazing, amazing work in philanthropy and teaching kids the power of giving. It's incredible stuff. But he gave me an opportunity. He said, hey, would you like to partner on a scholarship opportunity when they did this video? So I immediately said, yes. I mean, they've got 260 million subscribers.
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Most subscribed channel in the world.
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It's amazing. And so, yeah, so immediately it was, yes, and we put together 10, $10,000 scholarships. But here's the best part. We've got kids literally from every country across the globe, and they're submitting videos to win the scholarship.
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Wow.
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And in the video, it's just, you know, 60 seconds to two minutes worth of them saying, here's why education's important to me, why learning is important. It's cool.
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And how. How many of those videos do you actually get to watch?
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I'm watching as many as I can. Yeah. Yeah.
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That's awesome. You're touching so many lives, you know, It's.
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It's. It's really. I'll tell you what. These videos will make you cry because a young lady from a small village in Africa will pour her heart out about the importance of education to her and how she wants to change not only her life, but the life of her family and her community. And over and over, these beautiful stories are coming out. And best part is they're posting these on YouTube, on Facebook, on. On Instagram, and they're telling other young people why learning is important and why it can change your life. So it's, you know, it's one thing for me to stand up there and say, I'm an old guy, and I say, hey, learning is important. It's the key to opportunity, blah, blah, blah. And that's what it sounds like. It's like the guy on Peanuts, you know, when the adults speak, it's like, wah, wah. But when they say it, yeah, it's.
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Really special, you know, Jim. And people can't tell. Listeners can't tell. But I'm from a third world. I'm from Egypt, and I grew up in a household where all I heard every single day from my father was, which means in Arabic, study, study, study.
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Yeah.
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Okay. So my father, our family coming over from Egypt as third world immigrants, we became dead broke. My dad was a doctor in Egypt, but came as a gas station attendant here in the US and then had to work his way back up to being a doctor here in the US So he only did that through education. And still to this very day, and he is 74 now, he still studies like a nerd. You know, he's. And he taught. He instilled that mindset of perpetual grind in studying and learning, in academics and academia in general, in me and all my siblings. And, you know, we have one brother that says doctor. And the rest of our siblings sadly work over here with us at the company. I'm just kidding.
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You will. You will appreciate then you know where the title of this book comes from?
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What country?
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From your story. Because literally, this is a true story. Back during 9 11, we had. I was leading 7 11. I was CEO of 711 at the time. And we started getting bricks thrown through the windows of 711 stores.
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Yeah, I remember that era.
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Yeah, People were kind of angry and they were angry at immigrants and they said, hey, you know, 7 11. We had people walking in our store saying, go back home and go back where you came from. And so as the leader of the company, I, I stepped back and said, you know, why do we have so many first generation Americans in 7 11? And I started asking, just ask the question. How did you get here? Why, how did you come?
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And I thought Seven Eleven was Indian owned. It's got the Indian flag.
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No, no, no.
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As the logo. It's not. That's not the.
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No, that was a marketing company that came up with that in the late, in the early 1980s.
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Oh man. Here they are coming up with the Indian flag. Totally convinced.
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Let's see, there's the image, there's the perception. Yeah, yeah. And, but, but here's the story that I heard over and over from 135 different countries that were represented behind the counter at 7:11. I'd ask, so tell me the story. And what I heard over and over was we came like your story, like your dad's story. 500 bucks in our pocket. We had an education and we wanted the American dream. So we, we found a store because we could be our own boss. And then we'd bring our family in and, and then they would work and then they would go to school and they'd get a store and that perpetuated. So what I realized stepping back is this is the American dream. Alive and well. Right.
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7:11 is the American dream.
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It really is. So the, the spirit of the book was if so many first generation Americans like your dad can come here.
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I'm a, I immigrated.
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Well, it's.
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I personally am, I'm, I'm actually the first generation.
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See, so that's a beautiful story.
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My dad barely could speak English.
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If so many families can come here and successfully turn. Look at you right now, turn that into.
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I, I accomplished amazing things. By definition, the American dream. I mean it's. We're still beginning the dream, but.
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Exactly. So the purpose of the book was to say it's all, it all comes down to learning. So in the book I captured what to learn, how to learn, and why to learn. Because there's no reason for anyone in the United States to not to take advantage of all the tools we have here in this country.
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The tools, the resources, the opportunity.
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Exactly.
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The ability to make money with ease. Just the perpetual reminders that you gotta, you know, now with social media, we're just pounding people with ideas to make money.
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Exactly. But it's like a best kept secret for so many kids, particularly inner city kids that are, they're like, they're in a box that someone else put them in and they say, yeah, you'll never be anything. You can't go to school, you can't afford this. You can't. You know, who do you. I had that growing up because I Grew up literally, you know, a poor kid without running water. And I was told who you think you are, you know, you can't. You can't be CEO of a Fortune 500 company. Actually, that was even beyond my expectations. But. But I was. I was put in that box by others. And thankfully, I fought my way out through the power of learning and realized there is no box. Boxes in your head.
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That's right. So you became. So let's. Let's go through the journey of how you became Jim Keys. Like, because what was your first job? Like, how did you go from whatever your first job was, which was very, very low on the totem pole, I'm certain.
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Oh, come on. McDonald's flipping burgers. Yeah, that was it. That was a.
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But now that's a $20 an hour job. Just so you know, that's like a pretty good job nowadays.
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Yeah. You know what I mean? Buck and a quarter.
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Wow.
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Quarter an hour. Yeah, I'm dating myself now.
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20,000% jump and.
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Yeah.
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Hourly rate.
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Yeah. Yeah. But that was my first job, and it was a great experience, if you think about the job at McDonald's. First of all, I learned that the harder I work, the more I got rewarded. At 16, 17 years old, they made me a shift manager, probably because nobody wanted to work the night shift. So they gave me the. The opportunity. But what a great experience that was. I had to do the cash drawer on the way out, do the inventory. Basically, I woke up one day and said, you know what? Running a Fortune 500 company is not that different than running a shift at McDonald's. A few more decimal points in the numbers, but you're still dealing with revenues, customers, employees, payroll, hr, Bottom line, HR.
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Issues, the I. T, the legal.
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Exactly. It's all there. It's like. It's a. It's like a miniature version of a big company. So the experience was actually fabulous inside of a McDonald's.
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So for McDonald's, then what happened? How did you get the. You know, how. Take me to where you became first. The CEO of Blockbuster.
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First. Seven.
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Eleven for seven. Okay. You know, take me to the journey of how you became CEO of this Fortune 500 company.
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Few other jobs in the way. You know, along the way, I. We didn't have the scholarship support. A lot of people say, oh, school's so expensive today. It's like, man, when you're making a buck and a quarter an hour, it was pretty expensive back then.
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Well, a unit must have been like $3, though. Yeah, $1.50.
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Seriously, a unit yeah. Anyway, so I needed to make money if I wanted to go to school, and so I started driving a truck. I had a brother who was a truck driver, so he taught me how to drive a big rig. And so I drove a truck for a while, produce truck. Had to load my own truck in the morning, do two runs, come back in, work a night shift to McDonald's that evening, and then get back up after about four hours sleep, and go back and do it again.
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How old are you when this is happening?
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17, 18 years old.
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Okay.
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Yeah. Trying to make those.
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You listening? Because no. You know, if you want to become a Fortune 500 CEO, listen to this Journey.
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Yeah. I mean, it's. It's. It's work. It's. It's persistence and determination. There's a great Calvin Coolidge quote that I use in the book about persistence and determination.
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I'll ask you your favorite quote, actually, and maybe recite it for the audience.
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That's part of it. Yeah. Yeah, exactly. But, yeah, there were a lot of jobs along the way like that I worked in. My dad was a factory worker. One summer, I decided I was gonna try to take a job in the factory and see what he experienced. And that was a good.
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Declined that. Respectfully, I took the job.
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But I was glad the summer was over because I realized why he encouraged the importance. Importance of learning. Because that was a hard, hard life that he had in the factory. So, yeah, so all those things led up to trying to make enough money to get to college. And then I finally got into college. Undergraduate. I. I thought I was going to be a lawyer. I. I literally was poli sci undergraduate, which I don't know what you ever.
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Do with political science, but you go to law school.
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Yeah, you go to law school. It's about it. So I applied to a bunch of law schools, got into a few, and I had a professor intercept me along the way, and he said, jim, you're making a terrible lawyer. I've had you in class for two years. Please, please get an mba. I was like, I didn't know how to spell mba. I mean, literally, I had no idea. And one of the first schools to offer a joint degree, a JD, MBA program, was Columbia. So I applied. Never in a million years thought I would get into Columbia University. But by some miracle, the business school let me in. The law school wait, listed me, and so I said, well, I'll just do it in reverse. I started at the B school, got an internship for the summer with a major oil company. They offered me a Full time job and I never looked back. So I finished the mba, didn't go back to the law school and just began a pretty interesting career. I've had quite a journey.
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Nice. And then from what year did you become appointed as the CEO of 7 11?
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That was announced, I think in 1999. I was, I was really fortunate. And in, you know, in the book, I talk a lot about crisis because growing up you had some challenges growing up. I've learned that adversity and change is actually an opportunity because people, most people deal with it really poorly. Right. They, they, they become a victim, they blame other people, they have their head down. Yeah, I saw my challenges growing up. It turned out that I saw it as an opportunity because I kept my head up. And I used learning as a way to get out of those crises that I had as a kid. And so here I am, my first job, I go to. Well, second job. I started out with a major oil company. 711 had just gotten into the gasoline business and was rolling out gasoline across stores nationwide. And they hired some people from the oil industry to help. So that's how I literally arrived at 7:11 on the gasoline side through Citco Petroleum. And shortly after getting there, all of a sudden the company filed for bankruptcy. And they had done a leverage buyout. They took it private, loaded it up with debt. We complained today about interest rates. They funded $4 billion.
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18 or something.
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17. 17 and a half percent.
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Yeah.
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Yeah.
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I mean, still freak in comparison to those.
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Comparison to then. Yeah. So it was just a matter of time. By 91, 711 was bankrupt. And I could have. And many people argued I should have left. A lot of people did. Again, how do you react to a crisis? A lot of people head down. Woe is me. I'm quitting. I stayed. And by staying, I didn't work less, I worked more.
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Yeah. Because you had a crisis.
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I had a crisis. And, and I was used to it. I was okay. And on the other side of that crisis was huge opportunity. We ended up restructuring the company, took it through a successful chapter 11. I came out of that as vice president of strategic planning. Got to build a plant. The plan for the new 711 coming out of bankruptcy. And then I had the privilege of being CFO after that. A few years later, they made me chief financial officer, which was a shock because like I said, I was a poli sci major.
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Yeah. Not a financial guy.
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Yeah, not a financial guy. But we needed, we needed aggressive cost cutting at the time.
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Yeah.
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That I was able to do which took courage and detailed understanding of the business, which I was willing to dive into. So from cfo, then they made me chief operating officer and then ultimately CEO. So it was quite a journey. I got to sit in all of the chairs. But again, the major lesson here that I recap in the book is in crisis really is opportunity. I've coined the acronym CEO to mean change equals opportunity.
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That's a really good acronym for CEO.
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Isn't that cool? You live it every day, right. And you're a business.
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And you know what? I love change. You tell me a better way to do things right now, and I change at the snap of a finger and people think I'm crazy for it. You were like, that wasn't thought through. I'm like, you know what, we'll fix it later. Yeah, but like, we gotta change.
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That's why you're successful.
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You know, and you know, I do have a partner and he's much more risk adverse than me. So he does, you know, kind of reel me in and, and, and get me level headed and you know, make sure that we are pretty calculated about how fast we change. But yeah, we tend to change very, very quickly because we are adaptable. We are trying to leave a mark and a legacy for our industry as a whole. And I think we're making a significant impact, you know, at a national level currently. My, my hope is to make an impact at a global level very soon.
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Well, so you lived through one of these periods where interest rates were 2, 3%.
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Yeah, I lived through the, the race where money was below free.
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Right.
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So they were paying you to borrow.
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Right.
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Basically.
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And all of a sudden.
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And that doubles and then it actually tripled.
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Tripled. Yeah.
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And then, and then 90 of my industry actually left the business. And now we're. What, what happened was it just left us the big players in the space to just gain more market share.
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Exactly, exactly.
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So we have been aggressively attacking market share like a bulldog.
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Yeah.
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Attacking, you know, a piece of chicken bone.
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But that's what, you know, it's so funny because it's, it's so fundamental if you think about it, that, that business that all commerce starts and ends with, something changes.
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Yeah.
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And somebody else comes in and, and adapts to that change and, and then.
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And many. And many die. Which leads us into.
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Yeah. Block what?
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Blockbuster. Blockbuster. We're gonna, we gotta talk blockbuster because you know, everybody who. And we talked about this and we joked about like the listeners who are 15 years old right now don't know what blockbuster is, but Most of you guys who are, you know, millennials. Gen Zers. I don't even know what they call kids that are 15 now.
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Yeah, gen Z, I think.
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No, no, I think Gen Z is not. They're old. They know what. They know what block buster is.
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Yeah, Gen Z's do.
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Yeah. Gen Z's. No, the other generation with Mike, which my kids are. I don't know what they are called. But. But they don't know. My kids don't know what Blockbuster is.
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Right.
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You know, they have no idea. And. But there will be a really cool, probably Netflix documentary about you, and you'll be the star.
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Yeah, they should thank me.
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Yeah. So really, they should. Like, if it wasn't for you.
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Yeah, so.
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So Blockbuster. You became CEO of Blockbuster when they were already in a. In bad shape.
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Yeah. And, you know, there was a lot of myths out there about Blockbuster.
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So many myths that we're going to debunk today.
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Oh, man. Well, starting is. Oh, yeah. They turned down Netflix when Netflix went to them and offered to sell for $50 million.
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Yeah.
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Anybody that says that, I tell them, did you buy the stock at 79 cents? You should have. If you think Blockbuster should have paid $50 million, because that's what it was trading for at the time. Literally, this was the year 2000.
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And how much was it worth when they.
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Probably something less than $50 million. Yeah, but. But Blockbuster, you know, that was not me. I didn't arrive.
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They had already turned down Netflix.
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They had already turned down seven years before. This was 2000. I arrived in 2007. By 2007, Netflix market cap was like 1.7 billion.
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So you already came in. They already had all your market share there.
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Well, but no, they. They didn't really capture our market share. What they did, they at the time had a very successful DVD by mail business. Well, Blockbuster already had warehouses. They already had DVD inventory. So Netflix didn't really have anything that Blockbuster couldn't and didn't replicate at the time.
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So you guys. Yeah. You did do DVD by mail.
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Absolutely. They had, in fact, Reed Hastings and Mark Randolph, those guys would tell you that the Blockbuster model was actually advantageous versus the Netflix model because we had stores. So if you didn't like the DVD you got in the mail, take it back to the story, exchange it for something you wanted to see. So it was. It was actually Blockbuster created something called Total Access. Now, when I. Which was. Which was by mail, in stores, I.
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B
Think I had that. I had Total Access.
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Yeah, exactly. And it was a good program. It was a really good program when I arrived in 07, then I added two more elements to total Access. I added kiosks because Redbox had had just emerged. So we added Blockbuster Kiosk and then we added. The very first thing I did when I arrived at the company was to buy a streaming video company called Movie link. They had 3,000 titles already digitized. They were. This was a company created by.
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So you guys, I didn't even know that Blockbuster bot.
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I know no one does. No one does both. And it was the superior product at the time. It was created by the studios, five of the six major studios to consolidate all of the digital content into one stop so they could.
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So, so that was. That was Netflix.
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Well, no, Netflix didn't have streaming yet.
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So you already had streaming before Netflix.
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We picked up this company, you heard it here first, guys, with streaming and we were, we were in a very, very good position versus Netflix. And they'll tell you that now. We then had a couple of decision points that I'd love to have back because, yeah, I can't say that there aren't decisions I made that I wish I could redo. One was we bought the technology for streaming, renamed it Blockbuster Undemand. And then what we didn't do is secure the content exclusively. We had a chance to lock up 60% of the old titles on an exclusive basis. Had we done that now, it would have been about $100 million a year investment. It's a lot of money because if you dial back at the time, WI fi was a horrible experience, buffering very limited capability to really stream anything. The only people streaming at the time were kids on their Xbox for the most part. So when we passed on the exclusive lock in of old content, long tail content, we had access to the new releases that Netflix didn't have. But then we could have added the older movies. 60% of the library for $100 million. I took it to the board. The board passed. Understand why they passed? Because you didn't know how long will it take to monetize that? We could have, we could have acquired that content and then it could have taken 10 years.
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B
Who knew content would be king though?
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Well, everybody knew content would be king. What no one knew is how long it would take to recoup to be robust enough to have the streaming experience be viable. We knew it was coming, we just didn't know how.
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B
What G was that? Was that 2G at the time?
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It's like 2G. It was bad experience.
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Yeah.
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I mean you start a movie. And then you wait. And then middle of the movie, it would stop. And then, you know, buffering would go on, and you wait. It just wasn't a great user experience. But we were prepared. We were very well positioned. So you might say, then, okay, next, you guys.
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Yeah, you guys should have just 8 your losses for a couple years, like a tech company. But no one, you guys weren't operating like a tech company.
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Well, no, we could have eaten the losses. But here's what happened. And this is the real story behind Netflix and Blockbuster. We had a billion dollars of debt. Now, that wasn't really anybody's fault. The company went ipo. In other words, it was spun out of Viacom in the year 2004. They put a billion dollars debt on as a reasonable amount for the, for the earnings of the company at the time. It passed all of the reasonable tests. But it was due in 2009. They had a big tranche, like a third of it due in 2009. Now, if anybody had a crystal ball, if I had a crystal ball, I would have said, oh, the market's going to collapse in 08. I better refinance this debt in 07. Nobody knew. We got into the year 08, we doubled earnings. We had a great platform versus Netflix. We had true total access, including streaming. And then the market collapsed. We had a billion dollars of debt. We had no way to refinance the debt.
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So the, so my crash, the crash of 08, the industry, the mortgage crash.
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That'S what happened to Blockbuster.
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Hurt is what caused Blockbuster to implode.
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It caused us to have to file for chapter 11 protection because we couldn't refinance the debt. So we filed. Still, we had another life. We had strategic partners. I had a deal with Google that would have been a true game changer. But Google, when we were rumored to file bankruptcy, Google backed away from the deal. Dish Network stayed with us. They saw us through the Chapter 11 filing. They came out on top. They bought the company. And it was really Dish Network ultimately that decided to close the stores and back away from the opportunity.
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B
Wow.
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Yeah. Very different story than what?
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I had no idea. I didn't know that Blockbuster just basically imploded because of the debt crisis.
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A
Yeah, Yeah.
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B
I thought they imploded because they just. Netflix put you out of business.
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A
Oh, not at all. Not at all. And Netflix was a good competitor. I have nothing but good to say about Reed and the team over there, Ted. And they've done fabulous, fabulous job. They've. They've pivoted. Talk about change.
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B
They pivoted well.
- [25:39]
A
They pivoted well. I mean, who would have thought they would reinvent the movie production business by creating, you know, binge watching and TV series, basically, that turn into movies. They created that and they, and they made big gambles on that. They, They, I think, invested $100 million on House of Cards. Completely unproven content. Yeah. And they, they rolled the dice on and they won. It was a great product.
- [26:07]
B
Reed takes big risks.
- [26:09]
A
He does.
- [26:10]
B
He takes big risks.
- [26:11]
A
Yeah.
- [26:11]
B
And he's a visionary. I'd love to have him on the show if you can text him and let him know. Reed, if you're listening now, what do you think the biggest lesson is that you learned from both companies? The biggest lesson that you took away from being the CEO of 711 during the crisis and the biggest lesson that you took from Blockbuster and the implosion?
- [26:35]
A
Yeah, I've got three things that I've been. I've been a bit repetitive, but I think repetition is good. I call it my gift. Because these three things really, I think, have marked my career. They've. They, they helped to create a successful transition in 711 from bankruptcy through where they are today, to 80,000 stores. Yeah. And it's at Blockbuster. Even though people may think that that was a failure, in many ways it was a success because we were able to. To get through that crisis. We didn't liquidate the stores at the time. We were able to find a strategic partner and dish, get the company restructured, get it sold providers, preserve the jobs at the time and at least live.
- [27:16]
B
To see another day and still maintain one Blockbuster in Oregon.
- [27:20]
A
One Blockbuster. Yeah. In Bend, Oregon. But, so here are the three things. Number one, we've talked about adapting to change, but here's the problem. Most people don't have the confidence then to do something, so they'll say, okay, we got to change. But confidence is critically important. To be able to execute that adaptation to change, you've got to have confidence. And the third is clarity. Clarity comes in two forms, both inbound listening and outbound communicating. We complicate the shit out of everything. We're humans, so we take a complex problem, we make it even more complex by complicating it. And it's critical to be able to break the biggest problem, the hairiest issue that you face, into simple terms so you can solve it. Because you, you'll never. You'll just swirl if you try to solve everything at once. So to break things into simple terms, and then if you think about, you can have the best plan in the world. If you can't communicate it effectively, no one can execute it. Three simple steps. Brace, change. Have confidence and clarity. Or simplicity.
- [28:36]
B
Those of you guys who are over complicating, those of you guys who are not willing to change, get out of your rut.
- [28:43]
A
Yeah.
- [28:44]
B
Get out of your rut.
- [28:45]
A
Yeah.
- [28:45]
B
And. And Adapt or Die.
- [28:48]
A
Adapt or die. Yeah.
- [28:49]
B
Which is crazy because, you know, the, the assessment of Blockbuster at a public level, like, everybody talks about, like, you need to change or. And they use the example of Blockbuster.
- [29:03]
A
Oh, I know.
- [29:04]
B
So people have you actually used your company as like the poster child. The poster child.
- [29:10]
A
Yeah.
- [29:11]
B
Of Adapt or Die.
- [29:12]
A
Yeah, I know.
- [29:12]
B
They go Blockbuster and they'll put a Blockbuster logo next to a Netflix logo.
- [29:16]
A
I know.
- [29:17]
B
And that has been a symbol, actually.
- [29:18]
A
But here's what's so sad about that. By over there. And that's a case of oversimplification. They're not really doing the work. They're not really asking the right questions about what really did happen.
- [29:29]
B
Nobody knows. Oh, yeah. Blockbuster had a bunch of debt and then the crash of 08 happened. No one can. That's a lot to deduct. And it needs its own story. Exactly.
- [29:38]
A
But here's the sad part. For entrepreneurs especially, there is a critical lesson of cash flow management. Most entrepreneurs fail because of cash flow. Right. They get themselves into a box and they, and they, and they, they aren't watching cash carefully. They.
- [29:55]
B
Not tech companies. They. They just keep raising more.
- [29:59]
A
Yeah.
- [29:59]
B
Growing people more.
- [30:03]
A
But seriously, the lessons in Blockbuster are huge. It's a, It's a, It's a beautiful case study in what can happen and the need to pivot. Because the micro, the macro environment sometimes will cause you to have to react to it in ways you didn't want to. So I got there, I got there to transform the company. I knew that. Obviously. Digital.
- [30:26]
B
Do you think you said, do you transformed it to the best of your ability given the circumstances that you were in?
- [30:30]
A
Given the circumstances, yeah.
- [30:31]
B
Can you have. Do you think you could have saved it somehow?
- [30:34]
A
Oh, yeah.
- [30:35]
B
If you just had $100 million, though.
- [30:37]
A
No, I mean, there were a couple things I would have had that. I would have done that see, if I knew we were gonna. The financial markets were going to collapse. Collapse, and we were going to be under severe pressure, maybe even file bankruptcy. I would have acquired that asset and then filed around it. So we would have come out of bankruptcy, but we would have owned that asset.
- [30:54]
B
Yeah. You should have found the chapter 11.
- [30:56]
A
Yeah.
- [30:57]
B
That would have been A game changer.
- [30:57]
A
That would have been a game changer.
- [30:58]
B
And you had already went through bankruptcy with, with 7 11.
- [31:01]
A
It wasn't like I was afraid of it. I already understood it. And then that, you know, it is possible to come out the other side victorious. The other thing that I would have done, and this is what I. If I really had one thing I could do over with Blockbuster. When I arrived at the company, it was I was trying to buy it because they had already run into huge financial issues. The banks were ready to shut them down. The week I got there, they busted a bank covenant. So they were ready to put block Blockbuster down at the time because of their cash flow management. They weren't managing cash and the banks were really up unhappy with them. So when I got there, my intent was take them private. Had been talking to private equity firms, had been talking to investors. It wasn't going to be a big hurdle to be able to take Blockbuster private. Refinance the debt. Think about that.
- [31:55]
B
Yeah.
- [31:55]
A
In 2007, refinanced a billion dollars of debt to take it private a little more at about 6%. And then we would have blown right through the financial crisis without batting an eyelash.
- [32:09]
B
And none of our kids would know Netflix right now. It would have been Blockbuster would have dominated the streaming market.
- [32:15]
A
Blockbuster would have dominated.
- [32:16]
B
You had the branding, you had the streaming platform. You were already light years ahead. You already own the streaming platform.
- [32:21]
A
We would have done that deal for the intellectual property for the.
- [32:25]
B
But you wouldn't be sitting here right now.
- [32:27]
A
I know.
- [32:27]
B
You'd be a billionaire.
- [32:28]
A
Yeah.
- [32:28]
B
Often like a multi billionaire actually flying.
- [32:31]
A
Around in my gulf stream.
- [32:33]
B
Yeah. You didn't even, you know, know me.
- [32:38]
A
No. Yeah. But you know, it's it, it, it is business. It Businesses, that's what we love.
- [32:45]
B
Business is choice. Yeah.
- [32:46]
A
Choice.
- [32:46]
B
Business is risk. Yeah.
- [32:48]
A
And you make the best decision you can given what you know at the time.
- [32:52]
B
Yeah. And I wish I had. Like I. They say hindsight's 20 20. You know, it's like I just wish I had a little bit better hindsight.
- [32:59]
A
Yeah. Wouldn't it be great to have that crystal ball?
- [33:01]
B
Be great.
- [33:02]
A
Maybe time travel.
- [33:05]
B
But that's why I feel like you always just have to stay in tune with what youth are doing and just be always as relevant as possible. And I've learned through my marketing and my education that I want to be relevant to like my kids, which are 10 years old.
- [33:25]
A
Right.
- [33:25]
B
Nine years old. And if I'm relevant to them, then I immediately am relevant to their parents.
- [33:31]
A
Yeah. It's true.
- [33:32]
B
And that, that, that concept actually makes a lot of sense for me as you know, from, from a growth mindset perspective for our organization where I'm like, the kids know me, so their parents are going to work here.
- [33:44]
A
Sure. You want to, you want to hear a great example of that, what you just described?
- [33:49]
B
Sure.
- [33:49]
A
So I was invited, I'm here on the west coast because I was invited down to San Diego to speak at the limousine industry event that they had sort of a trade show. Trade show and down in San Diego. And I, and I was invited to talk about the book and about change and that kind of thing. And I thought, what am I going to say to these, you know, I.
- [34:11]
B
Mean, limousines, I mean, they're under a lot of pressure.
- [34:13]
A
Yeah.
- [34:13]
B
With Uber. With Uber we're black.
- [34:15]
A
And now you got.
- [34:16]
B
Sounds like a blockbuster. What are they doing anyways? How do they pivot so.
- [34:20]
A
Exactly, exactly something. And it's a lot of pressure. I'm thinking, oh man, I, I, you know, I want to give them reason to believe. Right.
- [34:26]
B
That there's still opportunity.
- [34:27]
A
Still opportunity outside of proms equals opportunity. Right. How am I going to explain this one? So, so I did a little research.
- [34:37]
B
And this is, what's, this is fascinating. I'm very interested actually.
- [34:39]
A
Seriously. Because this is, this is what the book is all about. With knowledge, you can solve virtually anything. So I started digging in. Okay, what's the future look like to your point, what are kids doing? And I was shocked.
- [34:53]
B
But they become content cars.
- [34:56]
A
Better than that. Better than that. I was shocked at the research I did and this took me like 15 minutes on the Internet.
- [35:02]
B
Yeah. Or you just ask chat GPT and it takes two seconds.
- [35:05]
A
Exactly. In 1980, right. When I was around the time I was, you know, getting my driver, my driver's license a little early in that 1980, 88 of 18 year olds had their driver's license. You know what the percentage is today?
- [35:21]
B
What is it?
- [35:22]
A
43.
- [35:23]
B
Wow. They just don't want to drive.
- [35:25]
A
They don't care.
- [35:26]
B
Yeah.
- [35:27]
A
We grew up, I grew up like it was a rite of passage. I gotta have my. Everybody. Now they're like, why take Uber? You know, I don't want to mess with a car. Why? So my point to the limo drivers was, hey guys, you realize there's a wave of demand coming because these kids aren't getting their driver's license. What's that going look like in 15, 20 years when they're now running businesses and they don't care about even owning their Own car, they're going to rely on transportation, but you've got to be able to be there for them and have a better experience than Uber. So are you branding, are you consolidating? Are you rolling up in the industry? I mean, fabulous opportunity.
- [36:09]
B
Wow. So, but how did, from a cost perspective though, how is a 18 year old or 20 year old going to afford a limit? Like are they going to cut costs? Are they going to go electric? How are they going to be able to maintain with margin compression?
- [36:20]
A
Well, that's the good thing about, about these big old cars, you don't really know. So the question is, who's going to respond to that change in the best, in the best way.
- [36:29]
B
Yeah.
- [36:29]
A
And there's two ways you can look at it.
- [36:31]
B
If you're gas efficient limo cars.
- [36:33]
A
Yeah.
- [36:33]
B
Or electric.
- [36:34]
A
Well, what I was recommending is cut a deal with the manufacturers. You know, you've got General Motors, you've got Mercedes, they're over producing EVS right now. They've got all this excess inventory. The consumer's not yet jumping in and adopting. That's, that's a screaming opportunity for limo operators to take on fleets and help the con. The manufacturers introduce this product to the public so that they're riding in the back saying, hey, it's pretty nice car, it's quiet. So all of these little things represent opportunity. But you have to be able to first see it instead of having your head down and saying, oh, woe is me, the industry's dead, Uber's killing me, blah, blah, blah, I'm a victim. Instead turn it around and go, hey, wait a minute, there's, there's a whole generation of young people that are going to need my service. I need to be there for them. I need to figure out a model that will compete effectively with Uber.
- [37:33]
B
The easiest thing now that I'm preaching from the rooftops is like to your point, and you just said it's like your brand. These limo drivers need to build their own brand within their own local communities.
- [37:46]
A
Exactly.
- [37:46]
B
So like when someone needs a ride, call me.
- [37:49]
A
Exactly. I gave them an example. There's a company in Texas now they're in Dallas.
- [37:54]
B
Black car company, right?
- [37:56]
A
Well, no, no, these guys are called Alto. They branded a car. It's all, I'm not sure which vehicle they're using, but they're all white cars with the very bold branding across the side of the car. But it's a white glove service. So it's like an Uber, but it's.
- [38:10]
B
A high end, it's like an Uber on steroids.
- [38:12]
A
Yeah, yeah, yeah, it's you. You've got a trained professional.
- [38:15]
B
People will pay for that. Because people have so much extra abundant money now from the random things that they're making money from these days. There's so much money.
- [38:23]
A
Exactly.
- [38:24]
B
Excess money. That Uber's not good enough for the rich.
- [38:26]
A
And well, it, there's plenty of room for somebody else in the, in that space. And that's.
- [38:31]
B
There is.
- [38:31]
A
That was my message.
- [38:32]
B
Hey, great ideas, great suggestions. For those of you limo drive driver companies, I mean that's a great, great concept, but it actually applies to all businesses and infrastructures anyways.
- [38:41]
A
It applies to virtually every business. It's my message to entrepreneurs. Change does equal opportunity, but you've got to overcome that natural human resistance to change that we've got.
- [38:53]
B
Yeah.
- [38:54]
A
Overcome fear. We all, we all are vulnerable to that insecurity. It's like, well, I don't know, I don't know if I can do it right.
- [39:01]
B
Yeah, you don't have that.
- [39:03]
A
You're an entrepreneur.
- [39:04]
B
Yeah, exactly, I don't. But you know, sometimes I think about it like, hey, it happens. But I just like, I'm like, what's the worst that could happen? I've always been willing to go, go dead broke.
- [39:12]
A
Yeah.
- [39:13]
B
I'm willing to sleep on someone's couch. I'm willing to. And to win. Right. So I, I'm a bigger risk taker than people think. I'm crazy. And having kids did change that dynamic a little bit because now I got four kids to feed.
- [39:25]
A
But yeah, pressure, just under pressure.
- [39:28]
B
So let's talk about some of the goals. So Jim Keys, the brand as the personal brand now, you know, you've built Jim Keys. Now you're like a public speaker, motivational speaker, bestselling author. What else is Jim working on?
- [39:42]
A
I've got, I've got too many interests. I'd probably be more successful if I could focus more. But I'm sort of the human ADHD of business because I, I get involved in everything from aerospace to retail to.
- [39:54]
B
Really, you got, are you, do you have ownership in some other companies as well?
- [39:58]
A
Yeah, I have a little bit. I've been sprinkling around a little bit trying to get, get some, some participation in, in some space. I'm particularly intrigued with space. I'm a pilot, I've flown my whole life. So aerospace has always been of interest to me and I've partnered with a company here in Southern California called H Star Building a bunch of former SpaceX employees that spun out and they're building a jumbo rocket for low Earth orbit. Great concept.
- [40:29]
B
Wow.
- [40:29]
A
Yeah. Yeah. So there's some really interesting stuff out there that I've been fortunate to be able to jump in and lend a little. A little advice.
- [40:39]
B
And you've done a great job with your philanthropy work, your education's freedom, working with the.
- [40:45]
A
Thank you.
- [40:46]
B
You know, Mr. Beast, philanthropy and. And just being. Even being associated with the biggest brand in the world and in. On social media and having a, you know, a philanthropic opportunity with such a household name is just tremendous. And it kind of speaks volumes as to the work you've been able to do. Talk to me a little bit about the philanthropy you've done.
- [41:07]
A
Yeah, I've been. I've been fortunate. But, you know, growing up like you did, like I did, you realize you've got a responsibility to help give back, right?
- [41:17]
B
Yeah, I sure do. My basic purpose in my life, all.
- [41:20]
A
It comes down to, it's. It's like, how do I help others achieve their success? Because if I can do it, I feel like anybody can do it. Right? So. Yeah, so I've been very pretty. Actively involved in a lot of philanthropic things. And the purpose of the book, it was really, the name comes from a foundation that I created while I was still at 7:11, and it was intended to go into high schools and help young people realize, oh, okay. I really can. I can do anything. I want to do it all about learning. The more I learn, the more I can, can do, and the more doors will open for me. So I. I set out to write that book, but then as I got into it, I realized this isn't just for kids. This is. This is for society. Because we're all vulnerable to fears and insecurities and all that stuff. And if. If I lead a life, I started this session today by saying, I wake up every day, it's a new adventure. And I mean that every day there's a new opportunity that I can't wait to see what's going to unfold. And the reason that my life is that way is I've learned how to learn. I can do anything. If I want to play an instrument, I just go learn it. If I want to learn a new instrument to play, because I've learned how to learn. If I want to fly a new kind of airplane, no big deal. I just go take some classes and I'll fly a new kind of airplane. I already fly helicopters and float planes and jets, but. Because that's a passion. But I've learned that you can do anything you want to do if you just decide, I've got the confidence I can do this. And now I'm gonna invest the time necessary to learn how to do it.
- [42:59]
B
Love it. Love it. Now a couple want to wrap up with a couple last questions. What's a personal goal that you have for Jim Keys as a person, your individual self, and what's the goal that you have for your business, your philanthropy work, etc.
- [43:12]
A
Yeah, that's a hard one to answer because, you know, I've, I've, I've gone through life in a somewhat opportunistic fashion. That's what entrepreneurs do. I think you, you say, yeah, I'm gonna go here. And then you realize, wow, I could go here. And so I've done that my whole life. My current goal, and I say current because it may change.
- [43:34]
B
Yeah.
- [43:34]
A
More opportunities may open up and I'll go down a different path. But right now, I've realized that I've got a unique opportunity because of two iconic brands, 711 and Blockbuster. I have an audience, and especially an audience with younger people, let's say 30 and below, that are hungry for their own success. And if I can help share some of those tools, simple tools, that will help them be more successful, that's, that's my current mission. Be able to do as much as I can.
- [44:10]
B
Love it. Love it. That ties into my last question. And this is going to change your physiology a little bit. But when you're in front of the, when you're in front of the pearly gates.
- [44:20]
A
Oh, what.
- [44:22]
B
What do you think God's going to tell you?
- [44:23]
A
Oh, man, that's a tough question. I would hope, I would hope it would be, hey, you screwed up a few things, but on balance, you did okay, kid.
- [44:38]
B
That's awesome. Mr. Jim Keys, thank you so much for coming to today's show. I appreciate you. Office for Closers. If people want to connect with you, how do they find you?
- [44:47]
A
James wkes.com I've got a website out there and for the book, it's Education is Freedom Book. So the title of the book and book dot com.
- [44:57]
B
Awesome.
- [44:58]
A
And yeah, yeah. And my, my Instagram, Jakey's author, Instagram, Tick tock, all that stuff. I've been having a lot of fun with social media.
- [45:07]
B
Yeah, awesome. Jakey's author on all social platforms. Check out his new book. This guy is a legend. Learn from the best you heard. You heard it and seen it first on Coffees for Closers. Let's.