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Invest Like the Best with Patrick O'Shaughnessy
Wolfgang Hammer - The Power of Story - [Invest Like the Best, EP.447]
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- [00:00]
Patrick O'Shaughnessy
The best operators have a relentless focus on leverage, finding ways to multiply their impact rather than just working harder. But here's what I see happening in finance teams everywhere. Brilliant people getting buried in expense management. Busy work.
- [00:12]
If you think about it, you become.
- [00:13]
A finance leader because you love strategic work. Modeling scenarios, optimizing capital allocation, finding the insights that actually move the business forward. But instead you're chasing receipts and categorizing transactions. It's the opposite of leverage. This is exactly why I'm so bullish on what the team at Ramp has built. Kareem and Eric understood that every minute spent on manual expense management is a minute stolen from high leverage work.
- [00:34]
So they automated all of it.
- [00:35]
Automatic categorization, receipt matching, spending controls that actually work. I love the network effect that this creates. When finance teams at companies like Shopify and Stripe automate the mundane stuff, they free up cycles to think bigger, to ask bigger questions, spot patterns others miss and make the kind of strategic bets that separate great companies from good ones. The math is simple. Get your time back, focus on what matters. Check out ramp.com invest and see what happens when you eliminate the busy work cards issued by Sutton bank member fdic. Terms and conditions apply.
- [01:06]
Podcast Announcer
As an investor, gaining an edge means having the right tools. And one platform leading the way is AlphaSense. Trusted by 75% of the world's top hedge funds, AlphaSense is the market intelligence platform that gives institutional investors access to over 500 million premium sources, from company filings in broker research to news trade journals and more. And with its recent acquisition of Tigus, it also includes the world's largest library of expert interview transcripts. Over 200,000 calls covering more than 24,000 public and private companies all in one platform. So investment teams can move faster, go deeper and make high conviction decisions with confidence. Now AlphaSense is transforming the research process with the launch of its Deep Research tool, part of the next generation of its AI powered platform. Unlike other deep research tools, AlphaSense's version is purpose built for investment research. It runs multi step iterative analysis using Alpha Sense's proprietary content, including those 200,000 expert transcripts and in minutes services. Insights that would take multiple interviews and days of digging to uncover. It's like adding 10 analysts to your team, helping you accelerate analysis, deepen understanding and make sharper decisions. See it in action@alpha-sense.com invest in asset.
- [02:14]
Patrick O'Shaughnessy
Management, growth often depends on customization. It's the nature of the beast in our industry and I know having experienced the problem firsthand as an active manager. It's a competitive differentiator to tailor products and services to clients preferences. Those of us growing our businesses always want to say yes to customers. It means delivering a tailored portfolio, a tailored report, or a tailored expectation for service. Saying yes leads to growth and it also leads to customization and a big trade off. The more you grow, the more complexity you absorb. The more you say yes, the harder it is to scale efficiently and consistently. That's where Ridgeline comes in. Ridgeline automates customization. It gives asset managers the ability to deliver personalized experiences at scale without adding headcount, manual work or operational risk. Having been an early design partner myself, I saw firsthand the power of taking an entirely clean sheet of paper to building the system. We've all been waiting for a front to back platform that combines all the firm's core functions on a single data set. It's how leading firms stop choosing between growth and efficiency and start saying yes to both. I believe the best firms will be built on Ridgeline as their operating system. I also believe there'll be a leading case study in combining the power of systems of record and AI. If you haven't spent time with them yet, I urge you to see what Ridgeline might unlock for your business.
- [03:29]
Hello and welcome everyone.
- [03:30]
Podcast Announcer
I'm Patrick o' Shaughnessy and this is Invest like the Best, this show is an open ended exploration of markets, ideas, stories and strategies that will help you better invest both your time and your money. If you enjoy these conversations and want to go deeper, check out Colossus Review, our quarterly publication with in depth profiles of the people shaping business and investing. You can find Colossus Review along with all of our podcasts@joincolasis.com Patrick O' Shaughnessy.
- [03:55]
Podcast Disclaimer Narrator
Is the CEO of Positive Sum. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of Positive Sum. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. Clients of Positive Sum may maintain positions in the securities discussed in this podcast. To learn more, visit Psum VC.
- [04:23]
Patrick O'Shaughnessy
My guest today is my friend Wolfgang Hammer. Wolfgang is a successful film producer and executive who helped create House of Cards and ran several major studios including Lionsgate, CBS Films and Miramax. He's now building a new kind of film studio with support from Mitch Lasky and Marc Andreessen. Wolfgang also helps founders and CEOs use storytelling to better understand what they do and why it matters. In many ways, this conversation is a manual for how to Find that story and communicate it in a way that resonates. Wolfgang shares the questions and tools he gives leaders to help them do the same. Our conversation explores how stories work, what great ones have in common, and why understanding your own story can be transformative. We talk about the three layers every story must have. The external, the emotional and the philosophical, and how they apply to building companies and leading people. So many CEOs at both startups and massive Fortune 100 companies have Wolfgang to thank for changing how they think and talk about their business. And I hope this episode gives you tools to do the same. Please enjoy my conversation with the great Wolfgang Hammer.
- [05:26]
Podcast Announcer
I'd love to ask a bunch of.
- [05:27]
Patrick O'Shaughnessy
Questions about work that you've done with companies and helping the founders of those companies distill down the narrative of them, their business, their product, in a way that's transformative for them. I know you've done this with startups, you've done this with massive companies we probably can't name. It's a thing you've done over and over again. Can you describe in as much detail, crazy detail, as you're willing to, the method that has started to emerge from this curiosity you have about certain builders and what you do with that curiosity and how you help them?
- [06:02]
Wolfgang Hammer
There's a thing in character development where the character at the beginning of a story will have a concept of the world that they believe is fixed. And it's very often a flawed concept. This is always attributable to a lack of self knowledge. And I think with the case of a great founder who feels that they're building something that's working and then they feel that perhaps the way they're thinking about the context wherein this product lives is limited. With big companies, sometimes they have a product that perhaps is not as good anymore as it used to be and that the conception of the world is antiquasis and they don't quite know how to pivot it. And then there are all these superficial answers that come and you grab from the world what the answers might be that you need to structure your company around. And my suggestion is always to pull that from the inside, so to access it through self knowledge. So with a founder, they're simply trying to find access to some buried truth that they haven't looked for in the right way that's in there when you.
- [07:00]
Patrick O'Shaughnessy
Talk to someone about this, like self knowledge exploration or something is the thing you're after, the underlying reason that they themselves may not know yet why they're.
- [07:08]
Doing what they're doing.
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Does it boil down to that?
- [07:11]
Wolfgang Hammer
The way I think of it is story works in three layers. One, there's the external mechanics of how the character interacts in the world. And you can substitute character for product. That's a requirement. And in the case of technology, it's technical. You gotta have something that works. And then there are two more layers, which is a subjective layer of why is this series of events important to me and what does it mean to me personally? And then there is a philosophical layer. And on a philosophical level, it's probably where you try to find out. And you have to steel man this. And it's very easy to straw man it, but you got to steel man it how you believe the world works today and what people believe makes a good world, because everyone most of the time believes they're doing what is the right thing. It needs to be done the way it's done for a reason. They're mostly not wrong. So there's a sort of almost intractable philosophical beliefs of how the world works and why that's a good thing. And then you juxtapose that with your own personal philosophy of how the dominant worldview is actually wrong, and supplant that with your own personal philosophy. And ideally, you do this as four or five points and you do it on a direct refutational basis. So each one, you say, everyone believes this. I believe that when this is steel manned, this is really helpful. And then you do the same. So this is on a sort of global level about how the world. And when we talk about world, it's probably specific to whatever it is you're building or running. And then you do that for the personal as well. So you can do it for a customer, you can do it for a person you're selling to. How do they believe things should be done? And you juxtapose that with what you think should be done. So there's three layers, and you want to hit each one of them.
- [08:58]
Patrick O'Shaughnessy
I want to just like drill on these three layers of the story and try to turn it into a device that someone could, like, take away from this and try to apply to themselves. If I'm listening and I'm curious about, I'll just keep it grounded in business, like the story of my business at these three levels. Is there a good question that I could ask, like, prompt myself with to get at the external, the emotional and the philosophical? Can you think of a question for each?
- [09:23]
Wolfgang Hammer
I think the external would be, what are we doing? What are we making? What are we selling? What Are we buying whatever it may be as a core function of the company? The philosophical is the why. So you believe in certain ideals, a certain way. You believe that the world should be on an abstract level. It's an abstract why, and the emotional is a personal why. In the founder's case, it's very often why they are doing it.
- [09:44]
Patrick O'Shaughnessy
So maybe to rebuild it in the other direction. The questions are something like, how should the world be? In a general sense, how do we believe?
- [09:51]
Wolfgang Hammer
How do I believe?
- [09:52]
Patrick O'Shaughnessy
How do I believe the world should learn?
- [09:53]
Wolfgang Hammer
The good life.
- [09:54]
Patrick O'Shaughnessy
Yep. The second layer is, why am I doing this? What is it about my specific story that maps back onto that? And the third is, what are we doing about it? And if you tell the company's story in that way, what does it galvanize that makes it worth pursuing in the first place? Because it seems like the thing that I encounter over and over again is even companies making something really great don't know how to talk about themselves for whatever reason. I'm curious why you think that is, why companies struggle with that and then why there's such a payoff to doing the work to figure it out.
- [10:26]
Wolfgang Hammer
I think sometimes it's because doing the thing is so difficult and complex that the idea of having to frame this now on top of everything else, in some sort of philosophical way is overwhelming and doesn't even seem necessary at times. Of course, it's always present and people just are not conscious of it. So when the predicate understanding of what is actually happening is made conscious and it's communicated in a way that doesn't quite name the thing, but is able to metaphorically describe it, it can be extremely inspiring, because it simply seems that these three elements of the external, the internal and the philosophical combined unlock something that moves people very deeply. I was at Stanford when the turnaround for Apple in its second inning. I should not be using baseball metaphors because I have no idea what they are, but this was a man who had a philosophy, a personal worldview, and knew exactly what he was fighting against at all times, and then acted accordingly with unbelievable discipline and courage and created something that was a work of art in many ways. He literally wanted to make business art, and he kind of did. Every one of these instances is completely unique, obviously, but I think that is what's possible. It also makes it just more interesting in general. It's very easy to be conformist in some sense because you know what's expected. But there's a lot left on the table too. At the same time, Espousing a new narrative or finding a predicate understanding just unlocks a ton. It doesn't need to be this life changing. Sometimes it can be incremental and just unlock a whole new world of potential that is very easily implemented. And in many ways stories are very good at creating symbols which represent some sort of transcendental belief that people participate in. So in the sense that everyone has an ultimate concern, something that they're in absolute ways concerned about, we'll talk about it. But it can be many different kinds of things. It can be money, it can be a deity, it can be truth. And to be able to present and ultimate concern around a business organization that makes a product of some kind, I think fulfills personal life picture for the people you're communicating it to. So it just. It feels more important, it feels truer, and it feels more meaningful and worthwhile.
- [12:40]
Patrick O'Shaughnessy
We're going to talk a lot about applying some of these principles to the world of building companies or making things. One of the very first things I can remember you teaching me is something to the effect of everyone focuses on the new when trying to tell you about their thing, but that the right approach is maybe only 20% new and 80% familiar or something like that. Can you say more about this principle of storytelling or of delivering a message or conveying something to people that the trap we fall in of trying to just focus on the exciting new thing?
- [13:12]
Wolfgang Hammer
The interesting thing about this whole world is that there are no rules to it. Everyone gleans and tries to come up with rules for themselves sometimes that seem to work more often than they don't work. But there's no book on this really. Raymond Loewy, the designer, had a similar rule around 1820. The most tolerable element of new before it's rejected by the human mind is incomprehensible. With the idea of originality and creativity, there's a sort of tension, even that in of itself is a story. There's this tension especially now. Originality is highly prized. And there's sort of this belief that only the very new is truly novel. And with storytelling especially. But I even think maybe this is confirmation bias. But I even think in business or in innovation, the new is really just the obvious uncovered through systematic trial and error over a certain period of time. So that by striving to stay within the obvious and trying to find a variation on the obvious, I think you have a higher chance, at least in storytelling of discovering something novel that will still feel intelligible enough to categorize in the world. Some people have an ability to see something truly new and immediately categorize it. Those people tend to be very successful investors, for instance. But generally speaking, I think the idea of original is overrated. And the great filmmakers know this, great novelists know this, that you can begin with something very familiar and make it feel totally new incrementally.
- [14:41]
Patrick O'Shaughnessy
Tell me about the short film that you like so much that's nothing more than a camera panning back and forth.
- [14:47]
Wolfgang Hammer
It was a project where simply there's a camera installed in the room, and the camera would move back and forth across the room and each time uncover a little bit more of the room and nothing else happens. There's no payoff to it. But the suspense of seeing a little bit more information about the room is absolutely riveting. Even just this tiny amount of new information being given creates enormous suspense, because somehow we're good at anticipating. We're really always anticipating. And each new piece of information gets put into some kind of puzzle. So by the end, the suspense is unbearable.
- [15:21]
Patrick O'Shaughnessy
If you think about the power of communicating by starting with the familiar and the known, how would you encourage CEOs, companies, people talking about their thing, use that truth. What is the method that you've seen the best? Explain accepted reality before trying to explain their new thing. Is there a method that comes out of this that you think is useful to founders, especially as the group that I'm the most interested in.
- [15:46]
Wolfgang Hammer
The reason storytelling to me is so effective is because you have a subjective point of view that an individual can relate to, because it's imitating and processing the character's point of view. So. So it's subjective in that way. The subjective access to storytelling would be a universal truth, but that can be only accessed subjectively.
- [16:08]
Patrick O'Shaughnessy
Does that mean that in trying to reach the mind of a customer, let's say the right thing or allocation of time for the founder is to spend most of their time understanding the story of the customer as it currently exists versus how it should be, and then build off of that.
- [16:22]
Wolfgang Hammer
I think that's exactly right. Someone called me, hadn't heard from them in a while, and they said, we realized we've been selling to the wrong level. We have to sell to C level as opposed to frontline manager level. And the sales pitch didn't work to the C level. It was because they had not changed the framework, this objective personal philosophy. The C level has a very different worldview of what's happening in company than the line manager. And we worked on it and it was like magic it was like magic. All of a sudden, closing huge national deals with huge companies because they understood the psychology of the senior level management. I think it's easy to forget that you're dealing with human beings who have a human experience at the same time as having a professional experience. And story is really good at seeing these two layers at the same time. There's a subjective experience that a human being has and then there's the professional experience on top of it. And I think you want to combine these two and understand you're dealing with human beings first and foremost. And I think the greatest founders and the greatest builders understand this instinctively.
- [17:25]
Patrick O'Shaughnessy
What did you learn running studios you've made or been a part of making so many things, so many movies?
- [17:31]
Wolfgang Hammer
Yeah, I always ran these sort of mid sized places. I never ran a Warner Brothers type place simply because they don't make the kinds of movies I'm particularly good at or interesting, interested in. At the same time, it's a very specific skill set to run the big ones. So I ran the mid sized ones. I think it has to do with being able to communicate in different worlds, which is actually quite difficult because you have to speak the language of filmmakers who live in their own world. And then you have to speak the language of corporate because they're reporting requirements, business requirements. You have to speak the language of marketing and sales. You're in these different worlds and your job is to understand the language of filmmaking and the language of business and the language of marketing and run interference so the thing can happen.
- [18:11]
Patrick O'Shaughnessy
What could CEOs learn from filmmakers? Two groups that like lead a group of people to make a thing. I've always had this weird obsession with filmmakers. I don't know why. Maybe it's the fact that the thing they make, it ends, the project ends and then it's on to the next. It's not just this like continuous thing that you have to constantly build. And that's appealing to me in some way. You've worked with some of the amazing filmmakers and seen, appreciated their art. What could one learn from the other?
- [18:37]
Wolfgang Hammer
I come back to this ability and willingness to take ultimate responsibility, which is really not what most people want to do at all. And for some reason, especially filmmakers that have a true vision of what it is they want to be doing, which means they're birthing this project and they take ultimate responsibility from beginning to end and then do it again, and then do it again, each time risking total failure, staking their entire being on this one. Next thing, they're running these pretty Big temporary startups that get funding from the outside world, they get distribution from someone else, not themselves. So I think it's courage and it's also encourage to espouse their particular worldview. And all the great filmmakers have a very particular worldview. I think it's extraordinary it exists at all in the world. Someone like that exists who will do that even if it fails, and then is willing to do it again. And some of the CEOs I've gotten to know are artists. In some ways. This is difficult stuff, especially when you have 100,000 employees and you're owning it too. But to answer the question more precisely, I think it's the willingness and the courage to espouse a specific kind of worldview that perhaps is a little bit counter, but stands in some tension to the dominant worldview and own that.
- [19:54]
Patrick O'Shaughnessy
Anyways, having been and worked with lots of CEOs that have chosen this ultimate responsibility, how would you articulate the job of a CEO in your experience? When you've seen people do that job well or do it poorly, what are the good ones in some basic sense doing really well?
- [20:10]
Wolfgang Hammer
All society is communication. And that because of its complexity, communication breaks down into buckets of specialty. But it's in essence being a master communicator of an almost infinite amount of buckets and knowing to context switch between them and understanding the language games that each one of these buckets plays, but never forgetting the core principles underneath all this. Some of it is unspoken. So I think the people I've observed, especially as one person that I admire enormously, is doing a massive turnaround. And he has been communicating the same marching orders for two years to this huge company. Everyone around him was in doubt and the results are finally coming in. And he's right. So in post he was well against all these obstacles, but he was able to do it because he could communicate exactly what he was doing almost in these three layers to anyone, but always adjusting. Never the philosophy, but always sort of adjusting the emotional component to whomever he was speaking to so that each person could hear the point needed to be conveyed so they could be at peace knowing that they'd done their bit for this thing to work out and to be able to communicate that in such a way that the people you're speaking to can hear it because you're adjusting this emotional, subjective, emotional component to them. I think that to me is the secret of great communication.
- [21:23]
Patrick O'Shaughnessy
What is an iconic character to you? And I ask that because I feel like most people maybe selfishly want themselves to Be like an iconic character in their own story, their company, to be an iconic thing in the world that it operates. You think about iconic characters where things come to mind.
- [21:39]
Wolfgang Hammer
My view today, and it might change, but has probably to do with an ability to be a Greek hero, which means to live and espouse a worldview that is universally disliked, that's iconic. I'm really interested on this pure narrative level in what Elon Musk is doing, because it's so unconcerned with the traditional hero trajectory is almost Greek. And this idea of breaking societal rules, if you will, that you get to some Platonic ideal that is worth more than acceptance. And I think all stories have in common the idea of resilience, that the character will overcome these obstacles and things are not working and there isn't enough knowledge and enough power to go where one must go, or one has impelled or has been impelled to go and keep going anyways. So this idea of resilience and to keep going anyways, even though the obstacles are getting enormous, I think inspires that begrudging admiration. None of this is a moral evaluation. No one cares what I think was good or bad on a personal moral level. But on a narrative level, I think it's absolutely fascinating that you have someone willing to step out on such limbs all the time.
- [22:47]
Patrick O'Shaughnessy
Is that just fighting death?
- [22:48]
Wolfgang Hammer
And, yes, everything is in some ways a death project. Absolutely. Who feels that creativity, the art of creating negates death and therefore is the purest expression of a battle against the inevitable. Tolkien has this famous clip on YouTube. All stories are about death. And I think he's absolutely right because it's the ultimate stakes, and it's the stakes everyone lives with every day. And we get up and do things.
- [23:10]
Patrick O'Shaughnessy
Anyways to go deeper on that. So we all have to die. And therefore a certain kind of story is appealing.
- [23:15]
Wolfgang Hammer
I think it has to do with a perceived power differential, that we're completely powerless in the face of death, at least for now, and that it is a fantasy to acquire more power. And then because we have this capacity to imagine the future and we can imagine really much anything, we have an ability to create our own cherished outcome. They're overcoming this weakness with the power fantasy. Robert Towne, who was a great screenwriter and wrote Chinatown, and he recently died. Wonderful life and a wonderful career. He said this to me at lunch years ago when I was a young executive. He said, stories are either desires fulfilled or anxieties purged. And I think he's right. These are great minds who've made great films and it's never left me. I think it has to do with overcoming basic human condition.
- [24:01]
Patrick O'Shaughnessy
I want you to expand on each of those two. Anxiety purged or fantasy fulfilled. That these are the two fundamental kinds of stories. Is it important that people know which one they're in?
- [24:11]
Wolfgang Hammer
I think you do have to know which part of it you're in. We experience both desire and fear. It's not just one or the other. The hero's journey is very often a desire to rise in the world. That's a desire to fulfill one's potential in the world. An anxiety or a fear purged is an idea of an inherent fear of something that might happen to you that you really don't wish to happen. And it feels good to see a version of the world play out. Where that which you're afraid of actually doesn't happen. Because you have had agency in defeating it. This is always really important. So story is character and action. Things don't happen to you. You act against obstacles and as you do, require knowledge. With knowledge comes power to then affect the outcome. It's also interesting to see that this is never done alone. They're always surrogates. People who give you knowledge and people who aid you in the quest, whatever the quest may be.
- [25:04]
Patrick O'Shaughnessy
As you began to process for what makes a great story, making them, enjoying them, what elements started to fall out?
- [25:12]
Wolfgang Hammer
I have an unusual maybe view of this because I don't always think it needs to be enjoyable. I think that's a recent meaning, in the last 30, 40 years phenomenon where storytelling became entertainment almost exclusively. I don't think that's really the genealogy of that space at all. But I also think story has a religious aspect. Not in the organized way necessarily, but perhaps in a way of ultimate concern. Stories are very good vehicles for delivering experience of ultimate concern.
- [25:42]
Patrick O'Shaughnessy
Maybe the most common ultimate concern, probably by revealed preference in the US in the group of people listening to this is money.
- [25:49]
Wolfgang Hammer
Yeah.
- [25:49]
Patrick O'Shaughnessy
What do you think about that?
- [25:51]
Wolfgang Hammer
It's an unbelievably powerful symbol because it stores potentiality. So the mind can imagine anything. So it's the ultimate story in some sense. Where both all your desires and fantasies can be fulfilled. And all your anxieties can be purged to such a degree, maybe, that the Money project is a denial of death project. The more you accrue of that, it allows itself to be imprinted with any vision that you want. The more you accrue of it, the more it gives the illusion that you're not going to have to leave your consciousness.
- [26:20]
Patrick O'Shaughnessy
What is a great story to you? What does that mean?
- [26:22]
Wolfgang Hammer
I think it's a character starting at an extreme point, going to an extreme point that they cannot imagine at the beginning, but consciously imagine at the beginning, but somehow deep down know that this is where they need to go. And then situations arranged in such a way that the original intent faces bigger and bigger versions of a barrier that is then resolved at the very end. To some degree, most characters that you meet are either underdogs trying to rise or kings who are falling or queens who are falling. The biggest people in the world believe they're the underdog because we are again locked into this subjective experience of the world. And we are wanting being.
- [27:01]
Patrick O'Shaughnessy
Why is that such an appealing story? Why is the underdog that succeeds so universally enjoyable?
- [27:09]
Wolfgang Hammer
But because everyone views themselves as one? You get access to people when they recognize themselves in what it is. You're saying it's the human desire to overcome our wretched state, which is this kicky gut phrase I always love. And it's humans are gods who shit. And I think it has to do with this capable being on this planet that has to die. In that sense, all these things are questions of death.
- [27:40]
Patrick O'Shaughnessy
I'd love you to evaluate my distillation of great story. Ask you what's missing in the elements that, as I thought, I know you were coming to see me. So I was thinking about this a lot. And I was trying to give myself only three common traits or something just to keep it simple. And the things I came up with were originality, which we talked a little bit about in terms of dominant worldview versus how you think the world should be. Hardship and ultimately transformation. As I think about my favorite stories, or if I think about the own best versions of my story that I've lived, because I know it intimately, those three elements have been present and or dominant in what I view as great stories. Where do you agree and disagree with those elements? I'm curious.
- [28:24]
Wolfgang Hammer
I think hardship as the barrier to be overcome is the foundational element of any narrative. I find it very interesting in general that when you look at the history of storytelling, how the archetype, if you will, the paradigm of what a story is, is someone actively overcoming obstacles to achieve something. I guess somehow this must correspond to how collectively you see this in Chinese mythology, you see it in Indian mythology. You overcome through activity, through intentional action, big or small, doesn't mean it can just be very, very small. So I think that's probably a foundational piece. The overcoming of obstacles which then becomes, in and of itself, the reason for doing it. There is no journey to go on without an obstacle. So in that sense, I think it's essential. Originality. I have this specific view. I think very often successful people. I just heard an interview with a brilliant designer and he talked about originality and how it's so important, and it felt like a status game that people play, that when they do something great, that somehow it was entirely original so as to aggrandize their achievement. And it's entirely possible that they felt that this was the case. I think very often it's much more derivative. And I think we should be much kinder to the notion of derivative. And I think we should understand perhaps that originality is just another form of derivation, except it's one that perhaps hasn't been done quite in this way before. Everything's been said, everything we've just said on this conversation, in this conversation has been said before in some way by someone at some point. It just wasn't maybe heard or it wasn't said in the right way that one specific person could hear it. I think originality is in the same.
- [30:05]
Patrick O'Shaughnessy
Way, maybe to redefine originality, then maybe originality is the wrong word, and instead it's like a novel revelation of some constant truth or something like that, like a new way to show people an old thing. And so what about transformation?
- [30:19]
Wolfgang Hammer
Transformation is interesting because in the Greek poetic sense, it would be a transformation. It would be the emergence of a new insight, a new power, which then creates a new kind of version of yourself or of the hero self. And then lately I've also added, maybe in my mind, this idea of the transcendental insight as enough. James Joyce was all about this, the Joyceian epiphany, the moment where the character accesses a universal truth, a transcendental truth about the world, just for a brief moment, and that's the end of it. So even just the recognition, oh, this is how the way things really are, maybe that's enough too.
- [30:54]
Patrick O'Shaughnessy
What have you learned about status and the role that status plays in human behavior? And, yeah, just more broadly, I know this is a topic that you've thought a lot about. Teach us about status a bit.
- [31:05]
Wolfgang Hammer
I think everything is about status. Every scene is about status. Every scene is about a power differential. It's what we find relentlessly fascinating. Every interaction is about status. There's a sort of story about. I think it was a British actor who knew absolutely everyone in English society and for some reason was unsuccessful at getting what they wanted. And he said when he overplayed his status, he would be hated. When he underplayed his status, he wouldn't get what he wanted. Everyone liked him, but he wouldn't get what he wanted. When he matched status, he will get whatever he asked for. How do you define it?
- [31:39]
Patrick O'Shaughnessy
What is it?
- [31:40]
Wolfgang Hammer
It's a sense of accepted superiority vis a vis another, whether it's physical, societal or moral.
- [31:48]
Patrick O'Shaughnessy
What about just on the very basic level of the thing you're doing and why?
- [31:53]
Wolfgang Hammer
I'm building a film studio from scratch. Mitch Laska is my chairman and A16Z is my investor, including Mitch. Mitch Laska is a former partner at Benchmark and comes from the video game world. And Marc Andreessen is obviously a great lover of cinema and has seen absolutely everything. And the quest is twofold. Trying to make movies in a very traditional sense that, at least for me personally, have an aspiration towards some kind of epiphany or some kind of transcendental insight, even if it's very brief, or maybe show some kind of transformation possible around these philosophical principles. And then there are two sort of technical components to it. One, being is in how we make things. And again, I very much believe that the nature of artistic expression is in the human and the human intent. But technology can help. Filmmaking is inherently a technological endeavor because you're representing the world via cameras. You're staging events to make them look as if they were real, but they're obviously not. So in that sense, technologically mediated and always has been. The third endeavor is going to be around distribution, but marginally, and we're all three very interested in whether something can be done on the edges that espouses this 8020 philosophy of, well, it's going to be very much a movie company. It is very much a movie company, but maybe has a couple of points in the dominant worldview that it perhaps doesn't quite believe and wants to substitute something else for it.
- [33:12]
Patrick O'Shaughnessy
What have you learned from each of those guys?
- [33:14]
Wolfgang Hammer
Both very endless, talented and absolutely endless. It's an amazing thing to be able to talk to people like this. And they're very different. They're both founders. They're both amazingly successful investors and have done the whole thing. They've done it numerous times, and they're very patient and generous, at least at this stage of the game. They both have a real understanding and passion for the craft and artistic nature of storytelling. Courage, complete comfort with calculated failure, as in, if you know what you're doing, you're trying something, and you know it's a Trial balloon. It's totally all right if it goes wrong as long as you really thought about it. And there's a calculated risk as opposed to a random, let's see what sticks kind of risk. Really incredible ability to map out sort of in an imaginary way what could be. Always allowing that you're not seeing something but really mapping it out. Never sort of in a sense where it's this or that. It's always. It could be all these kinds of things and based on past experience, this has really worked. And then sort of branching off of that most. I think risk tolerance, I guess maybe it's a blessing of success that you just increasingly become tolerant, like I said, of calculated risk, which in the creative endeavor is a requirement because you're going to fail.
- [34:24]
Patrick O'Shaughnessy
Do you think we take enough risk in general as people?
- [34:27]
Wolfgang Hammer
No, no. Not on the personal emotional level. Not on a professional level. Even just being around people who have a more benevolent attitude towards failure can be extremely helpful because one's own worth is not caught up in whether something works or not. This is also a huge advantage that the Americans have over the Europeans. Failure in Europe is so shameful. And then America is more forgiving, obviously on the margins. And sometimes you think, oh, wow, this is a level of heedlessness that perhaps is a little irresponsible. But yeah, I think risk is inherent, sort of the end stage of this kind of transformation that you talk about. When you have figured out your ultimate concern. You figured out that there are going to be barriers. You can kind of name the barriers even you gain self knowledge. You realize that through action there is power even just in the action itself, even though it doesn't actually yield anything immediately. And then action begets action, which begets courage.
- [35:21]
Patrick O'Shaughnessy
I'd love to sort of redo an exercise that you've done on me before because I think it's translatable for everyone listening. You asked me some question which was something that rhymed with what is the version of your story that is so big that it terrifies you? Can you unpack that? Very powerful question.
- [35:39]
Wolfgang Hammer
The mind obviously is very good at projecting into the future and can imagine really anything. And in many ways, what is possible, even emanating from our own subconscious, is so much bigger than what the left hemisphere brain, the rational analytical brain, can handle. So I think there is a fear of the bigness of the world. That fear of the bigness of the world is also reflected in the inner world. So much of story is actually an inner transformation when you have infinite potential in the outer world. This potential is probably also inside of you, and it's overwhelming. So fear is present, but it's a fear of potential, of all that could be.
- [36:21]
Patrick O'Shaughnessy
So you think fearing greatness is the ultimate fear?
- [36:24]
Wolfgang Hammer
I think fearing greatness as long as we define greatness as a manifold flourishing of life in all its forms, not just a great engineer or a great company builder, if we believe, as I do, that storytelling, especially through the course of from Gilgamesh all the way to now, is thousands of years of storytelling and myth making that we have thoroughly enjoyed people realizing potential in the world, that there is an inner drive to reach one's potential. I do think there's probably a fear of reaching one's own potential because it might be too big.
- [36:59]
Patrick O'Shaughnessy
What about inner conflict? Like a character who wants two opposing things?
- [37:04]
Wolfgang Hammer
That's the definition of story. This is a Faulkner quote. But great conflict is the heart in conflict with itself. That's a great story. So you want two conflicting things at the same time. You're very invested in your fear. You create situations in the original state where this investment in your fear pays off. And at the same time, there's a part of you, mostly subconscious, but can be conscious, that has a dream of greatness. And those are absolutely in conflict because the fear wants to dominate and the greatness wants to come out and do its thing. And it's through the story itself that this gets worked out. And I always think this when someone takes on the position of a leader and how relieved everyone else is not to have to do that. People love to just disappear and amass and be relieved of the burden of individuality. But this is possible because someone has a will to power and steps up and says, I will do it.
- [37:55]
Patrick O'Shaughnessy
Why do you think that is? Should we all be leaders in some way?
- [37:58]
Wolfgang Hammer
In some way, I think. Emphasis in some way. I think we have a very narrow definition of leader as business or political leader, and that's sort of the end of it. I think, actually, if you invert that and you just simply say you have a predicate understanding of yourself at that point in time based on reflection, and you act according to this predicate understanding as best as you can at that point in time, you are already a leader simply because you're guided by a philosophical worldview that feels absolutely true to you at that moment.
- [38:28]
Patrick O'Shaughnessy
Back to this exercise of a version of a story that's so big it terrifies you. It sounds like the model is raw. Potential is so big, but the mind can't figure it out. And so the process is figuring out how to get something that's like, subconscious out. Like let it free. How does one do that?
- [38:47]
Wolfgang Hammer
Character in action. Through action. This is the great discovery of the pragmatists, which I think is a huge reason for why the American experiment has been so successful. Is that people do a lot of doing happening. You cannot have a good narrative without an active character. There's no one who sits around and thinks their way through problems. I think it's a combination of having a dominant worldview to fight against, of having a personal worldview to espouse, and a willingness to, through action. And I think also through quiet reflection, let those voices that perhaps are in the subconscious safely come to the surface and see where it goes without having a specific outcome in mind over time. Narrative fear made conscious and conquered through action.
- [39:35]
Patrick O'Shaughnessy
If I go back to the beginning and take everything we've talked about and ask you to give a sort of grand unified theory of everything that you've been searching for, what's your best attempt at that?
- [39:45]
Wolfgang Hammer
I think it's a technology that is able to. Through consilience, so through pulling from all strands of knowledge to communicate an ultimate concern. So an absolute truth in the story universe in such a way that the individual can understand it on an emotional, personal level. Which is kind of also what philosophy has been trying to do. And it's also what religion has been trying to do. So in that sense, it's a technology layer of arranging situations and character in such a way that enables this transmission. So in that sense, storytelling is so terriological and has as its concern a form of salvation. Not the form of salvation, a form of salvation. Maybe the answer to the question, am I worthy of love? The answer is yes, very often comes back to that on the emotional love. And then very often, is it safe to die? And the answer is, in most cases, yes.
- [40:35]
Patrick O'Shaughnessy
Why is the answer both yes?
- [40:37]
Wolfgang Hammer
Because it's better than the alternative.
- [40:41]
Patrick O'Shaughnessy
You mentioned a guy named Don Rosenthal to me one time.
- [40:44]
Wolfgang Hammer
Yes.
- [40:44]
Patrick O'Shaughnessy
What did he teach you? And how did he teach you too?
- [40:47]
Wolfgang Hammer
That it's safe to die and that you're worthy of love.
- [40:50]
Patrick O'Shaughnessy
How did he teach it to you?
- [40:52]
Wolfgang Hammer
By saying that in the end, every story is a metaphor. So you want to couch all these absolute truths revealed in a subjective way in metaphors that don't spell it out directly, but convey their meaning through something that's close, but not the thing itself. Here, this wonderful way of repeating back to you the absurdity of your beliefs and laughing at them. So you would be laughing at these absurd constructs that these stories that you've come up with and believe to be fundamentally true, mainly because you hadn't done the work of just saying, well, what do you really believe once you do that? It's your ultimate concern and it's your bedrock. And you can refer back to that at any given time, usually every five minutes, when you have to communicate and make a decision of some kind and it gives you confidence. And there is a guy that I really like, this guy John o' Donoghue, talks a lot about Meister Eckhart, who had this concept of gelassenheit, which is the letting go of all intent. Simply experience the divine nature that's already in you by the pure fact that you're alive. And once you realize that, all else is an afterthought. And I think that's probably what Don Rosenthal communicated to me in a visceral.
- [42:03]
Patrick O'Shaughnessy
Way, I'm going to ask my traditional closing question. What is the kindest thing that anyone's ever done for you?
- [42:08]
Wolfgang Hammer
I thought about this. There's so many people that I owe a lot to, but I know that it's my wife who married me. I think that probably is the kindest thing.
- [42:19]
Patrick O'Shaughnessy
Simple as that. Wolfgang, I've counted on you for so many episodes of trying to figure things out, and you've pointed out several times today that each version of this exercise is deeply personal and you can't abstract it into some perfect formula to have everyone find their way. But I hope we've done a decent job of some breadcrumbs that people can follow in pursuit of their own most interesting version of their story. Thank you so much for doing this with me. Thank you for your time.
- [42:47]
Wolfgang Hammer
Thank you.
- [42:49]
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