Jim Keyes | Former CEO of 7-Eleven and Blockbuster on What Always Happens Before a Company Crash and How He Ran Multi Billion Dollar Busines

Summary

School of Hard Knocks Podcast – Episode Summary

Episode: Jim Keyes | Former CEO of 7-Eleven and Blockbuster on What Always Happens Before a Company Crash and How He Ran Multi Billion Dollar Businesses
Date: February 6, 2026
Host(s): James, Jack, Josh (The School of Hard Knocks)
Guest: Jim Keyes

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Episode Overview

In this episode, the School of Hard Knocks team sits down with Jim Keyes, the acclaimed former CEO of 7-Eleven and Blockbuster. Jim shares hard-won lessons on leadership, humility, global expansion, corporate transformation, and the inner workings of some of the world’s most recognized companies. This discussion serves as a masterclass in running billion-dollar businesses, weathering industry disruption, and leading with vision and resilience.

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Key Discussion Points & Insights

1. Becoming CEO at 7-Eleven: From Bankruptcy to Billion Dollar Success

• Early Role: Jim spent 20 years at 7-Eleven, holding roles from operative to CEO (02:49).
• Rise Through Crisis: When 7-Eleven went through bankruptcy in 1991, Jim saw opportunity in chaos:
  • “Change equals opportunity. Turned out to be a great opportunity for me personally and for the company.” (03:14)
• Sale to Japanese Licensee: The Japanese licensee’s ambition to move into China led to a buyout, shifting 7-Eleven into new hands (04:10).

2. Lessons in Global Business & Cultural Literacy

• Cultural Adaptation: Jim credits his London student exchange and growing up learning cricket from Indian friends for shaping his global mindset (05:39).
  • “I learned what I call today cultural literacy, because I had to adapt.” (05:56)
  • Upon leading 7-Eleven: “...all my American teammates were behaving like Americans. I took a healthy dose of humility…” (06:32)
• International Expansion Advice:
  • “I call [the necessary skill] cultural literacy...It’s truly understanding where the opportunities are and then understanding their culture.” (08:11-09:43)
• Building Relationships Internationally: In the Middle East and Asia, trust and time matter more than fast business talk—a sharp contrast to American norms (10:32).

3. CEO Mindset: Vision, Perspective, and Leadership

• The “45,000ft View”:
  • “A CEO has to have perspective. They have to look at almost what I look at at 45,000ft in Ms. Baby. The world is a different place, a global view.” (12:03)
• Teaching Strategy: Communication is key, but getting the team to speak the strategy is vital to true understanding (33:56).

4. People, Ego, and the Power of the Right Team

• Most Valuable Resource:
  • “The most valuable resource that any company has is the human resource. Not very many CEOs realize that.” (13:27)
• On Ego and Humility:
  • “I’m not humble...Can’t be humble and fly that [jet].” (15:15, 15:25)
  • “Norman Vincent Peale...used to preach on the importance of confidence...But he preached in equal doses about the importance of humility. When you’re smart enough to know what you don’t know...” (15:34)
• Tough People Decisions: Loyalty is not an excuse for holding onto under-performers (13:27).

5. Knowledge, Confidence, and Fearlessness

• Differentiation:
  • “This brand—Jim Keyes—had to differentiate himself, especially in a corporate environment...” (23:42)
  • “Change, confidence and clarity...number one thing that propelled my career.” (23:50)
• Relentless Positivity:
  • “I call it relentless positivity...I got it. I got this. Give me the ball, coach. Put me in. I can do this.” (25:27)

6. Navigating Disagreement & Corporate “Cancers”

• Don’t Tolerate Toxicity:
  • “You’ve got to cut the cancer out immediately...they are disruptive and they drag the organization down.” (34:29)
  • “Two killers in every organization: the fighters...or the flighters, the passive aggressive...These behaviors are killers and driven by fear.” (34:29)
• Addressing Conflict: The root cause is often fear or lack of knowledge (36:42).

7. Blockbuster & Netflix: The Truth Behind the Company Crash

• Blockbuster’s True Downfall:
  • Blockbuster had streaming ready, the content pipeline, and even a Google (YouTube) distribution partnership lined up before Netflix’s rise (39:00-42:52).
  • “If Reed Hastings was on this podcast, he’d go, yeah, we were dead.” (41:32)
  • The 2008 financial crisis blocked vital deals and precipitated Blockbuster’s collapse, not simply a failure to “see Netflix coming.”
• Debt and Inertia:
  • “Big company disease...You get to a certain point and that fear creeps in, inertia creeps in.” (47:21)

8. The Value (and Limits) of Education

• On College:
  • Jim’s education provided corporate access points and upward mobility (18:49).
  • “Be an entrepreneur, but get a degree...when a CEO is looking at 100 resumes, they’re going to go straight to the degree first.” (20:07)
• Liberal Arts vs STEM as AI Rises:
  • “If you double down on being a coder, you may lose your job...So...the ability to communicate, to write, to think, have critical thinking skills...that’s going to be way more important in a world of AI...” (21:47-22:56)

9. Building Wealth in Corporate Roles: Equity and Ownership

• Getting a Piece:
  • “If it’s a big company...get to that level [for equity] as fast as you can...if you approach...say, I want to participate, I want to feel like an owner. I think they’ll respect that...” (29:30)
• Entrepreneur vs Intrapreneur:
  • “You really don’t need to be the number one to be successful. I mean, the number two, three, five at Facebook made hundreds of millions, if not billions...” (24:56)

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Notable Quotes & Memorable Moments

• On Opportunity Amidst Crisis:
  “Change equals opportunity...In a challenged company, when I had my head up and looked at it as an opportunity, I ended up being able to sit in chairs...” – Jim Keyes (03:14)
• On Humility:
  “When you’re smart enough to know what you don’t know...” – Jim Keyes, quoting Norman Vincent Peale (15:34)
• On Differentiation:
  “You guys have to differentiate yourself from everybody else...We forget that we are a brand individually.” – Jim Keyes (23:42)
• On Relentless Positivity:
  “I got it. I got this. Give me the ball, coach. Put me in. I can do this.” – Jim Keyes (25:27)
• On Fear in Organizations:
  “Fear is probably the single biggest killer of careers, of companies, and, candidly, even societies.” – Jim Keyes (50:17)
• On Blockbuster’s Fall:
  “If Reed Hastings was on this podcast, he’d go, yeah, we were dead...” – Jim Keyes (41:32)
• On Education in Asia:
  “The Chinese have gone since 1998 from 10% of their population...going to college. Guess what it is today?...61 and climbing fast.” – Jim Keyes (20:04)
• On Faith and Leadership:
  “The Bible 365 times says, do not be afraid... Yoda said, do not be afraid. You gotta believe, dude. If you’re gonna be a Jedi, it’s gotta come from inside.” – Jim Keyes (27:04)

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Timestamps of Important Segments

| Segment | Time | |-------------------------------------------------------------|-----------| | How 7-Eleven bankruptcy created opportunity | 03:14 | | Cultural literacy and global mindset | 05:39 | | How to choose what global markets to enter | 08:11 | | Building relationships internationally | 10:32 | | CEO perspective: seeing the “45,000ft view” | 12:03 | | Human resource is the most valuable asset | 13:27 | | Jim’s humility and Norman Vincent Peale’s definition | 15:34 | | Blockbuster and Netflix: the real backstory | 39:00 | | Blockbuster’s existential debt problem | 42:59 | | Differentiation and relentless positivity | 23:42 | | Addressing and removing toxic “cancer” employees | 34:29 | | Equity and wealth-building for executives | 29:30 | | Final advice: Be fearless | 50:17 | | How Jim Keyes wants to be remembered | 51:20 |

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Closing Reflections

Keyes’ Last Message:
“Be fearless. Fear is probably the single biggest killer of careers, of companies, and...societies. There is absolutely nothing to fear, if you use knowledge for things that can be known, and then...fall on your faith or the force...there’s nothing to be afraid of, and you can accomplish absolutely anything.” (50:17)

How He Hopes to Be Remembered:
“I hope people will remember me for trying to make a difference...helping people achieve a lot more and fulfill their true opportunity, their full destiny.” (51:20)

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This episode delivers a sweeping perspective from inside the C-suite of two iconic companies. Jim Keyes’ candid, direct style and storytelling illuminate the realities of leading at scale, the dangers of fear and inertia, and the limitless possibilities of knowledge, optimism, and courage—delivered with wit, humility, and decades of practical wisdom.

Transcript

[James]

You're the CEO of seven eleven. How big was the company at that point in time?

[Jim Keys]

12, 13 billion at the time. And now they're 60 or $70 billion company.

[James]

How did you maintain your humility and your humbleness to not let that compromise you?

[Jim Keys]

Not humble.

[Jack]

We're in front of the man's jet right here.

[Jim Keys]

Come on. Can't be humble and fly that the most valuable resource of any company. We tend to think of it in terms of the equipment, the assets and the human resource.

[Josh]

Can't have the yes men around you.

[Jim Keys]

You can't have the yes men because they'll Dr. Right down. They'll yes you to death. Bible 365 times says do not be afraid. Yoda said, do not be afraid. You gotta believe, dude. You gotta. If you're gonna be a Jedi, yes, you need knowledge, but you also need to have the Force be with you.

[James]

If me and you died tomorrow and you had one more message, sleep with the younger generation, what would that be?

[Jim Keys]

Here's the way I would describe it and, and.

[James]

What'S going on, everyone? Welcome back to the School of Hard Knocks podcast. I'm James and I'm here with Jack and Josh and we are out in Dallas, Texas with an absolute legend, the man who became the CEO of not just one, but two multi billion dollar Fortune 500 companies, Mr. James Keys. James or Jim today, what are we going with?

[Jim Keys]

Let's go with Jim today because you're James. That way they'll keep us straight.

[James]

We'll go with Jim then. But more importantly than that, you know, I've had the pleasure to meet Jim numerous times over the last couple and you're an amazing human being, man. You do a lot for society, a lot for business owners and just want to say that we really appreciate you and this is going to be a masterclass on leadership and what it really takes to grow, run and lead a billion dollar company.

[Jim Keys]

So James, thanks for the kind words. But let me tell you, since we met, you guys have gone global and you talk about doing good things. Everywhere I go and I've been in 14 countries in the last year. I have young people come up to me saying, I saw you on School of Hard Knocks and I learned so much from what they're able to share with me from people who have been successful all over the world. It's pretty exciting.

[James]

I love it.

[Jim Keys]

Really proud of you guys.

[James]

It means, it means a lot, man. Really appreciate that Jim and I know that there's a lot of different ways we can go, but Where I want to kind of get started off is I want to go right back to 2005. Again, you're the CEO of Seven Eleven. You guys are a what, how many, how big was the company at that point in time?

[Jim Keys]

It's about, I want to say, 12, 13 billion at the time. And now they're, I think 60 or $70 billion company, 90, 90,000 stores worldwide. Pretty amazing, very proud of them.

[James]

Again, you're the number one of an 11 figure business. And you end up, I would imagine, also with some of the, you know, shareholders and other people come to the decision to end up selling 711 to what was it, a Japanese oil company?

[Jim Keys]

No, it was actually the Japanese licensee. And it was a fascinating story. I spent literally 20 years with the company and had the privilege of sitting in virtually every chair from running that gasoline operation when I joined to being the head of strategy. I was with CFO for a while, chief operating officer and then ultimately CEO. And it was fascinating because we saw the company through good times and bad. It was a wildly successful public company. And then they did a leverage buyout and loaded up with too much debt. Familiar story. And by 1991, 711 was bankrupt, almost went away. And that ended up being an opportunity. What's my expression, change equals opportunity. Turned out to be a great opportunity for me personally and for the company. Because in a successful company, I may have worked another 20 years and never risen to the top. But in a challenged company, when I had my head up and looked at it as an opportunity, I ended up being able to sit in chairs. Like being chief financial officer of a public company would not have happened in a wildly successful operation. So that change, that problem turned into an opportunity for me and for the company.

[James]

Could you tell that story of how exactly you sold 711 and kind of what all went into that process?

[Jim Keys]

Yeah, it was really an interesting time because we had gone from all of those challenges to all of a sudden we had 10 years of improved same store sales quarter by quarter. We were, you know, great increase in EBITDA and profitability. And the Japanese licensee who had invested in us to help us emerge from bankruptcy, they wanted to develop China. Well, the Chinese government actually came to Dallas, Texas to meet with me and asked me to bring 711 to China. And it was hard just to say as a public company, worldwide, US based public company, that our licensee, our one licensee could have the rights because we had a great licensee in Hong Kong, in Taiwan, in Thailand, all these other locations in Korea. And so we said, we really have to go through a process. Well, the Japanese licensee really wanted China, and so they decided we're going to buy the company. And they ended up literally putting an offer in and taking the company, giving us an opportunity to sell.

[Josh]

Doing business internationally can be very different than doing business in the United States. We've spent a fair amount of time in the Middle east, and how they approach business is completely different than in the United States. They really want to get to know you, eat dinner, break bread with you before you even talk about business. What was the difference between doing business business in the United States versus doing business with that Japanese licensee?

[Jim Keys]

It was huge. Huge. And I credit a lot of my success to as a kid, having an opportunity to go to school out of the country. I did a junior year in London, and, you know, you might think London's the same. They speak English, right? I got over there, they hated me. I was a Yank. I was an American, and I had to learn the culture. And it was actually my Pakistan, Pakistani friends and Indian friends who took me under the wing and said, dude, you're not in Kansas anymore. And literally, I learned what I call today cultural literacy, because I had to adapt. I had to understand my British friends. My Indian friends taught me how to play cricket, and I made the cricket team over there. All of a sudden, I went from the least popular to the most popular. Well, little did I realize that that cultural literacy, by the time I was leading a corporation like 7 11, helped me do business in China and Japan and other countries. Because I. I walked in and all my American teammates were behaving like Americans, you know, like, hey, we're American. And I took a healthy dose of humility and said, you know what? We're in their country. We have to understand their culture. And that was a huge advantage and the ability to do business internationally.

[James]

We were having the conversation earlier today about, you know, I mentioned to you that this last week, I interviewed a billionaire in New York City, Jamie Salter, who owns Authentic Brands Groups. And one of the questions that I asked him during our interview was, you know, his best branding advice being that, you know, he owns Forever 21 champion Reebok. You know, he owns the licensing to Shaq, Elvis, Marilyn, remember all these, you know, people? And his one word to me was, he paused and said, global, which is when you follow Jim on social media for everybody watching, you are all over the place. I mean, you're in the Middle east, you're in Asia, you're obviously throughout the States, Australia, Africa, Africa, I mean, Ghana, I mean, who knows where. I mean, Antarctica next, probably, but. But on the list. But my question is, you had the experience going into many global markets with 7 11. What is the best strategy as a business owner to kind of approach the global landscape that tells you this is where you want to go next? Are you relying on the research of other massive companies to kind of tell, hey, there's going to be a massive customer base here? You know, sort of how when you want to open up a retail store, it's like Starbucks. They do all the research, you know. So I wanted to kind of get your approach for going global. How do you go global?

[Jim Keys]

Well, a couple of things. First of all, I see it as an opportunity. In fact, you guys are global. And I am very proud of the fact that you're out there reaching out. You're in the Middle east, you're in these other countries because much of the world has been inflicted with. I think I see this whole nationalism trend. It's kind of a temporary thing a little bit, is a pushback fear of changes happening so fast. It's being driven by technology. But if you think about that just that very fact, technology is shrinking the world big time. I mean, when I was doing business with 7 11, Japan, we had telex machines. Not even. We didn't even have fax machines to communicate. It took weeks. Now I can get on a zoom and talk to a friend in China and, you know, matter of hours just waiting until they get into the time zone. So it's changing so fast, that means that global opportunities are everywhere. So while everybody else has their head down looking domestically, saying, I don't know about those other cultures, you guys see the opportunity and you're out taking advantage of it. I think that's the next. One of the next big things is for people to develop this skill, which I call cultural literacy. And it really is not just saying, I'm going to go do business in another country. It's truly understanding where the opportunities are and then understanding their culture. So when you walk in, you're not walking in as, hey, I'm an American. Do business with me. You're walking in saying, I want to do business with you. I want to win. Win.

[Jack]

When we took a trip to Saudi Arabia, you know, we were on an investment delegation going over there to explore opportunities in the region, in the Middle East. And one of the big takeaways that we had to realize was like, hey, when, you know, in America, a lot of times you go to networking events and you're like, oh, I do this, this, this, and this. And you know, we would be meeting people over in Saudi Arabia and you try that approach and people are just like, not receptive to it at all because it's just like, man, like it's, it almost seems like you have something to sell or that you want something when it's just like, if you can actually just take time to just build a relationship and actually show that, like, hey, I'm not just here for money. I'm here to actually build in the market and do great business here, then people are way more receptive to wanting to do business. And it's just something, I think a lot of Americans wanting to expand, to go outside of the US to want to do business there, need to understand.

[Jim Keys]

We're just so anxious. It's like when I was a kid, I couldn't go sit in a pub and talk. I had to be playing darts, pinball, something. Because that's us. We're Americans. We like to do stuff. But this idea of relationship in business is so fundamental to so many other cultures in other countries that unless you're willing to have patience and take the time and truly know them so that they know you and that's how they develop trust.

[Jack]

And it's principles that even if you read in books like how to Win Friends and Influence People, a lot of those principles are super simple, but they even matter most in a culture that you didn't grow up in. That, you know, doesn't really excuse the hey, I'm Jack and I'm with School of Hard Knocks. And you know, I'm over here and I'm looking for this partnership and this deal. And it's like people, they don't, they don't know you, they don't want to hear that. It's just like, man, like, who is this American coming on to me? So it's very interesting. I wanted to ask because I think that there's so many people out there that glamorize the CEO role and the title. And you know, this. Being a CEO of a company is a big deal. Like that is a huge, prestigious leadership position. And not many people, you know, there's a lot of CEOs out there, but not a ton get to be a CEO of a public company, let alone a billion, multi billion dollar public company. So what are some of the things that when you were a CEO of a public company, especially one of that size, the average person or even the average CEO of a small business in America doesn't understand I think the hardest.

[Jim Keys]

Part about being a chief executive officer is the recognition that you've got to be able to see the whole landscape. You can't be buried in perceptions. And we're all victims of seeing things on the Internet or picking up one little piece of information, getting a person forming a perception. A CEO has to have perspective. They have to look at almost what I look at at 45,000ft in Ms. Baby. The world is a different place, a global view. And that's one of the hardest challenges when you come from, particularly up in the organization, from an operating role or a financial role. Now you're chief executive officer, you've got to have the big picture and have a vision for where you want to bring the rest of the company. So that's a step one. And then there's a whole host of other things. Teaching, communicating. If your team doesn't understand the strategy, it'll never be able to execute it. These very, very simple, I call them meta skills that are critical to the success of any leader, really big company or small.

[Josh]

As a CEO, especially of a multi billion dollar company like Seven Eleven, you're overseeing thousands, tens of thousands of employees, hundreds of thousands. What are some of the key principles that you think make up a great CEO?

[Jim Keys]

Well, first, there's an important recognition here, and it took me way too long in my career to realize it. The most valuable resource of any company. Yours. We tend to think of it in terms of the equipment, the assets. No, no, no. It's the most valuable resource that any company has is the human resource. Not very many CEOs realize that. We kind of take for granted. Yeah, I've got an HR department, they do that stuff. And ultimately it's the people in any enterprise that will make or break the success of a company. So that ability to focus on having the right people in the right jobs, which again, 90% of us. I'm guilty. Oh, Joey's been around for 20 years. Such a good guy, you know, he'll get better. Taking the whole team down. You've got to make the hard decisions. It's actually better for old Joe if you cut him loose and let him do something that maybe he likes to do or he's better at. But these are the hard things that a CEO has to do. And having a good human resources professional by your side and especially in a big company, critically important.

[James]

Daniel Lubecki, who's the founder of Kaimbar, he's a good friend of ours and he had a quote that he had shared in one of our interviews, which was that ego is the only thing more powerful than greedy in your case. Right. It's very easy, right. I'm running one of the biggest companies in the world. It's very easy to kind of have a big head and think that, man, like, you know, like to have that ego get in the way. Was there ever a time where you felt that happening? And if so, like, how did you kind of maintain your humility and your humbleness to not let that compromise you?

[Jim Keys]

I'm not humble.

[James]

Yes, you are.

[Jack]

We're in front of the man's jet right here.

[Jim Keys]

Can't be humble and fly that. You know, for. For me, it's, I think, an advantage the way I grew up. I mean, I grew up dirt poor. If I went back to being dirt poor, it wouldn't be a whole lot of fun, but I know I could because that's where I came from. And, you know, my brothers, my family kind of keep me humble, saying, dude, we. We know the way you grew up on. And so that helps. But. But let me give you a definition of humility. That's my favorite. A guy named Norman Vincent Peale was a. A preacher and a teacher. He wrote the Power of Positive Thinking. Right. Norman Vincent Peale used to preach on the importance of confidence. You got to have. You got to be out there power positive thinking. Right? But he preached in equal doses about the importance of humility, not shrinking violet humility. No, no, no. I'm not that smart, you know. No, no. Be as smart as you want. His definition of humility I love and I've embraced. When you're smart enough to know what you don't know, that I think I'm a pretty smart guy, but there's a lot of people smarter than me. And all I know is I know that every person that I encounter knows something that I don't know. So my mission, Find out what that is. How can I learn from you and that knowledge that I can learn from everybody I encounter, whether it's a janitor in a hotel or another CEO, I can learn from them.

[James]

Was there an unconventional piece of advice that you received from somebody that you may not have expected to in the traditional sense that you recall that maybe you'd want to kind of cast on to our audience?

[Jim Keys]

Yeah. Probably one of the harshest pieces of advice came from a regular old worker who was, I believe, working in a factory. And we were having a conversation and knew me pretty well and basically said, dude, you got to chill. You've already accomplished more than 98% of the people on the planet and you're like, gotta do more, gotta do more. It's not about making more money, it's about having more freedom. Man, he was so right.

[James]

Let's talk about that real quick. You brought up freedom and one of your turning points to financial freedom was actually getting an education and going to college. In today's world, there's a lot of entrepreneurs and people that kind of preach this notion that don't go to college, it's useless, you don't need to get a degree. Whereas I actually have changed my perspective and outlook a little bit on it recently, which is that I think that if you have to go into tens of thousands of dollars of like debt to get a college degree, I don't think it's worth it by any means. But like in our case, you know, our dad had the GI Bill for the military and, you know, we were able to pretty much go for a free or relatively cheap, for the most part to school. And it enabled us to, you know, get exposed to meeting thousands of people, a lot of them like minded and also moving out of our hometown. So I've come to kind of, you know, realize that there are certain value adds that it had. Even though that the substance in the classes and whatnot may not be the most important stuff that's going to help propel you in the business world. But I would love to get your perspective on what that education did for you going to college and then also what you think about it in today's world.

[Jim Keys]

Yeah, I'm going to give you a total counterpoint. This is like a totally different narrative than what's out there because what you just described is the narrative. You got Peter Thiel telling people, hey, I'll give you a bounty. Don't go. Don't waste your time going to college, Elon Musk. Don't waste your time. Just go out and be an entrepreneur. To me, this is like Michael Jordan saying to me, go play basketball, you'll be fine. It's like, dude, I can't jump. You know, I'm okay, I can shoot, I can shoot a three pointer, but I am not going to be able to rebound. I don't think I've got a career in the NBA. Here's the deal. And the reason that education worked for me is I don't think I certainly, I didn't know how to be an entrepreneur. I didn't have any role models. I didn't have the drive, I don't think, to be a self Made entrepreneur. The degree got me a role in an environment that I could leverage that degree into better and better positions and gave me still an entrepreneurial environment, but in a corporate structure. So let me give you a number that'll scare you. For all those people that don't think they need college. The Chinese have gone since 1998 from 10% of their population. 18 to 24 year olds going to college. Guess what it is today?

[Jack]

90, 85, not that high.

[Jim Keys]

7, 61 and climbing fast. They believe that the future is technology. If you're in a, if you ever experienced being in a math class with a bunch of kids from Asia, you know, like, oh man, there goes the bell curve, right? They're doubling down on education. So now here's what that means. 20 million college graduates a year, many with STEM India putting out 15 million. That's 35 million college graduates. Remember I said the world is shrinking? Well, we're putting out four and declining. 35 million from those two countries versus our four. Who's going to take these key jobs, you know, in 20, 30 years, I'm telling everybody, be an entrepreneur, but get a degree. Because that point of differentiation, when a CEO is looking at 100 resumes, they're going to go straight to the degree first and then they're going to see who else has what kind of experience because it's really hard to measure otherwise.

[James]

Do you think though that the traditional liberal arts college education needs a lot of reform though? Because I see the point, but it's also, I mean, we went to the University of Texas, right? It's a top 30 global ranked school, man. And there was a lot of, there's a lot of bullshit in that curriculum.

[Jim Keys]

There is, there is, but look at, look at me. I'm a political science major, right?

[James]

And now you're a legislative correspondent.

[Jim Keys]

Did you use any of that? Yeah, I mean, I did. I did not. I was going to be a lawyer.

[James]

Hey, now Jim's going to be a legislative correspondent. There you go, Capitol Hill.

[Jim Keys]

Yeah, I'm pushing the, to your point. Education is broken right now, particularly in United States and we need to change. And I am aggressively lobbying for that change. But, but here's my point. It's not about what you learn right now because with AI coming, everybody's like, oh my God, it's going to take all the jobs. Well, it's going to take some jobs, but nobody knows which jobs. So if you double down on being, you know, a coder, you may lose your job because AI may take that if you double down on any one thing. You just don't know. So I love to fly. Obviously. I tell all the young people that are getting their pilot's license, get a degree, because in 10 years, this thing may be autonomous. 20 years maybe, and you may be out of a job. So if you've got a degree, you can then pivot. And that's where ironically, I think the liberal arts, probably, if I was to start over today, I would be in the liberal arts because the ability to communicate, to write, to think, have critical thinking skills, I think that's going to be way more important in a world of AI than it is even today.

[Jack]

A lot of people are saying, you know, be careful who your doctor is in a couple of years, because they might be using ChatGPT to get through medical school. So, you know, one point that I wanted to. To bring up is that, you know, through your journey, you know, going to becoming at the top of 7 11, you know, you kind of, you climb through the organization. And I think this is a valuable point not just for those that aren't entrepreneurs watching this podcast, but even if you are an entrepreneur, so you can almost recognize superstars within your organization. But what were those key differentiators that you think you had that allowed you to propel yourself up to the CEO role within 7 11? Because I think there's a lot of people that could learn from that who might be in a job that, like, they're just like, man, like, I'm just kind of coasting by and it's like, how do you. How do you increase your income?

[Jim Keys]

Yeah. Thank you. Thank you for using the term differentiation, because that's what business is all about. You guys have to differentiate yourself from everybody else out there. With online, you know, code coaching and mentoring programs, all that stuff, you've got a different and you do it well. But we forget that we are a brand individually. This brand. Jim Keys had to differentiate himself, especially in a corporate environment, because there's a hundred other people vying for the same opportunity, upward potential. So I had to differentiate. Here's. Here's the way I would describe it. And, and I've actually mentioned this. We've got a little clip that has probably 50 or 60 million views where I said it was change. Confidence and clarity, as simple as that sounds to me, it's the number one thing that propelled my career because most people encountering change put their head down. They're like, oh, man, I don't want that. I embraced it. Confidence to do something about it. I found that confidence isn't something you're born with. I certainly wasn't the way I grew up, man. But I learned confidence, and this is a great example. You have to learn confidence to be able to fly an aircraft.

[Josh]

I also feel like there's a big misconception that you kind of, like you said, you need to start a business to be successful. You really don't need to be the number one to be successful. I mean, the number two, three, five, at Facebook made hundreds of millions, if not billions. Billions dollars. And it's one of those things where if you can be a great intrapreneur, a great number two, a great number three, the potential for you is unlimited. But it's really, you got to pick the right horse to bet on, and you got to give it your all, just like you are that number one.

[Jim Keys]

Yeah, that's exactly right. And you got to differentiate. It's. You know, in a corporate environment, I never sat down and said, hey, I'm going to join this company because I think I'll be CEO someday. That was, like, so far out of my frame of reference. Now, in hindsight, I just. I outworked 90% of the people I was around, and I think I had something that. You guys have a lot of negativity out there, a lot of victimhood, a lot of blame. I've got something I call relentless positivity, and I see that in you guys. It is. I got it. I got this. Give me the ball, coach. Put me in. I can do this. And not. Not everybody has that.

[Jack]

It's. Well, you know, and I think a lot of successful entrepreneurs have that as well, as well as executives, is you have to almost have a radical optimism about what you're doing, especially if you're leading an organization. Like, if somebody's working for 7 11, and you came up on the podium and said, guys, I don't feel good about what's going on right now. Like, the company's gonna be like, well, how am I supposed to feel? Whereas if you're just like, hey, like, even if we're going through a challenge or things like that, you know, and you feel optimistic about it, and this is how we're handling it, like, everybody. They. They still carry that, like, okay, we're gonna be all right. We're gonna be all right. And. And if you're. Especially if you're. If you're running, like, a startup and. And all hell is breaking loose and things are not going well unless you have just that. That radical belief and vision and optimism, that it's going to pay off, you know, how's your team going to follow you?

[Jim Keys]

Absolutely right. In fact, I'm going to give you another gem. I think this is a nugget because I've been out talking all over the world about the importance of knowledge, right? And I've had a couple of people go, hey, there's more to it. Because my point is, you got to be knowledgeable, but you can learn anything. So whatever crisis you've got, you can learn your way out of the problem. It was like, well, what about those things you do not know? What about those things that cannot be known? I was like, oh, man. Okay, that is a tough one. Here is what I found. I am going to get all. I am going to seemingly get all religious, but I am actually not. The Bible 365 times says, do not be afraid. The Quran 170 times. The Torah 120 times. Yoda said, do not be afraid to Luke. Why? Because may the Force be with you. Now, I did not know this until I get told these stories around the world. And I came back and I said, I wonder what George Lucas meant by the Force. You know what he meant. It was a metaphor for faith, not any one religion. You got to believe, dude. You got. If you're going to be a Jedi, it's got to come from inside. And you got to believe. Yes, you need knowledge, but you also need to have the Force be with you.

[James]

Hey, what's going on, guys? We're going to be right back to the episode with Jim Keys in just a second, but I wanted to take a moment to let you all know that if you subscribe to the Hard Knocks podcast right now, you will not regret it. Because every single week, guys, we're bringing you the most insane business owners and business moguls across every industry to this channel. So subscribe to the Hard Knocks podcast. With that said, let's get back to the episode. I wanted to ask you, because we were talking about this earlier, is that whether or not you think somebody can build wealth working in the corporate world, and the one thing that you did very well, especially when you were a part of that exit with 7 11, is you had some equity in the company. And I want to talk to those people that maybe they're working in corporate America. They're. They're going to start out, maybe they got that field business, and they're going to look and get that job. They want to be a part of that startup, per se. What would you say? Have you seen as the most effective way to go about getting the proper, whether it be equity and stock package with a company and how you see those deals structured on behalf of not the owner of that company per se or the person hiring, but rather the person that's trying to get some equity in a company. What's the best way to go about doing that?

[Jim Keys]

Yeah, it depends on the size of the company. If it's a big company, it probably has a, an equity plan for senior management. Now your challenge, if you're starting out your career, get to that level as fast as you can. That means you may have to be the first person in the morning and the last person out at night. Because unless you can get to that point that you're earning equity, you're going to be a salaried person for the rest of your career. And you might at some point be better off saying, you know what, I am going to go be an entrepreneur so I can develop my own equity. It's a hard personal choice to make. But okay, let me dial back now to a smaller company. I would have that discussion with the ownership of the company because a lot of smaller companies don't have equity plans. It's a little harder when you're not a public company to have a phantom stock or a stock equivalent, but it's possible. And I think if you approach your owners of a smaller company and say, I want to participate, I don't care what it takes, I want to feel like an owner. I think they'll respect that and perhaps craft a program where you can earn equity even in a, even in an entrepreneurial environment.

[Jack]

I kind of want to go back to my point earlier about like, as the leader of the company, you have to have this radical optimism and kind of cast the vision. And back to your point earlier is like you kind of have to have that 45,000 foot view looking over at that perspective, looking over everything. And how do you cast that vision onto the rest of the team, onto the rest of the company? Because you know, like, to me like, I feel like the like effective CEOs that, you know, a lot of the well known ones that everyone does is like they get up on stage and they have everybody in the auditorium. Like I even remember like the video of Steve Ballmer like clapping his head. Developers, developers, developers. Like, it's a hilarious clip. But how do you cast like, you know, every CEO probably does it differently. But how do you, how or at least how did you cast vision onto the employees of Seven Eleven and the companies that you ran?

[Jim Keys]

I'VE got two things I've got that are tips that I had to learn the hard way. Number one, when you have many layers of management between you and I had 10 to 12, maybe at one point, 15 layers of management between the CEO and the store operator, that's 15 chances somebody is going to misinterpret the vision or strategy.

[Jack]

It's a long game of telephone. Right?

[Jim Keys]

That's exactly. That's exactly the way I describe it. It's just like a game of telephone. That's management. So I cut through all that. I took a page out of Sam Walton's book, and we were at 7:11, one of the earliest national users of teleconferencing. So I do a teleconference and every week, Monday or Tuesday, get the whole organization. And I'd say, here are the three priorities for this week. If you do nothing else, I want the stores clean. I want. We've got a Slurpee promotion this week. You know, that sort of thing. So that's one to cut through the layers of management with communication. It's critically important, even in a smaller company. The second is one of the worst days of my career. I discovered, have you ever heard Of A 360? A 360 is where you get your whole management team and you go around and everybody tells them you what they think of you and your strategy, et cetera, et cetera. So we had a 360 exercise, one of those human resources things, a leadership development thing. And everybody went around and their assignment was write down the strategy of the company. And I thought I was the great communicator, because every week I'm up talking about the strategy. Right. Like you said, Steve Ballmer, you know, and when everybody wrote down their strategy and then articulated it, I was shocked. It was the worst day of my career. It's like, they don't get it. You guys have been around me for all these years and you don't understand the strategy. Here's the problem. I was the one speaking the strategy. It's like learning a language. You can learn it out of books, someone else can teach you, but until you actually get out and start speaking it, you can't articulate the strategy. Same thing. And so I changed my approach to having all of my teammates start to speak the strategy. Not just listen to it, but speak.

[Josh]

It as a leader. One of the things that you're in the business of is people. And you have personalities of all kinds. And you're not only just dealing with that person. One on one. But they're also interacting with other team members as well. And as a company continues to grow and grow, you may have a superstar in your organization, but that superstar may also be a cancer to where maybe they're toxic to their teammates or they're disrespectful, maybe they show up late. They're just not really living up to like the company principles. How should someone go about dealing with that?

[Jim Keys]

Yeah, you've gotta, you've gotta, you've gotta cut the cancer out immediately. And it happens. Unfortunately, people are people. What I tried to understand is getting to the root of the cancer. And nine times out of ten I've discovered it was fear. And here's what happens. We as humans have this thing called an amygdala that kept us from being eaten by a lion and it triggers the fight or flight response. So there are two killer things in every organization. The fighters. People who will resist everything and they are disruptive and they drag the organization down. Or the. The flighters, the. The passive aggressive that it's even worse. Yes, boss. Good idea. That's great. I love that. That's smart. And then they walk out of the room and go, I'm never doing. That's the dumbest I ever heard. Those two behaviors are killers in corporation and they're driven by fear. So what's the antidote to fear? Knowledge. You've got to a CEO be able to help their understanding, help them get over their fear and replace that caveman brain that I just described with what I call the aviator brain, which is using having your whole team not revert to perceptions, fear, anger, resistance, but instead embrace knowledge and data to make better decisions and to have confidence both as a team and individually.

[James]

On the flip side of that, I want to talk about how, let's say that you have somebody in the company who's a fellow executive and maybe you guys are just not necessarily seeing eye to eye where you guys have like a flat out disagreement, but you guys are aligned in the sense of the direction that you want to take. The company, the vision and whatnot, the characters there like you talk about, which is not necessarily taught. It's the person has it or they don't. What is your looking back when you had some of those things happening at 711 or Blockbuster, any of the companies that you've run that you started, how do you kind of get to the pain point or fix that bottleneck when you have a disagreement about when an important decision needs to be made in a timely manner? What was your Framework, looking back, that you would kind of pass on to other people.

[Jim Keys]

Let me give you an analogy. I was cfo, and I was in a budget meeting once, and someone just screamed out in the budget meeting, f him. The CEO was in there. I was CFO at the time. F him. He didn't know what the hell he's talking about, blah, blah, blah. If you don't fire him, I'm gonna quit. You know, we're all sitting there going, whoa, that was a pretty bad outburst. What the heck was that? And, I mean, I could have gotten equally mad, but that's the trouble. This escalation thing, if I reverted to my caveman brain, which is what he was just demonstrating, right? Fight or flight, he was ready to do both. If I reverted and fought back, that would have gone nowhere. It would have spiraled down. Instead, I met with him. I had a chat with him. Guess what the issue was.

[James]

What's that?

[Jim Keys]

He was the equivalent of someone who couldn't read at 40 years old. I was like. He admitted to me, basically, the reason that I was so upset is I don't understand the budget. I don't understand finances. I came up through the organization. No one ever taught me a P and L. So when we finally got to that, he softened up, basically, and said, would you teach me? Because I never learned. And that was why he was lashing out, because his fear of being exposed that he didn't understand the finances of the company caused him to lash out and revert to that caveman. So again, I could have then I caveman back and said, you know, or instead I could have tried to get inside of, what is it that's upsetting? Why are you resisting this? And it turned out, thankfully, he was honest with me, and it was just a simple lack of knowledge that made that triggered that fear.

[James]

I want to shift gears. We talked a lot about 711 blockbuster, me and you had a really good conversation about that earlier. And in particular, the. The kind of case study that was done about that. Could you break that down again? I would love for you to talk about that. How the four different boxes that was checked between the content, the distribution, the exclusive. Could you. Could you talk about that again on a lot of, like. Like we said earlier, Right. A lot of people's favorite company was Blockbuster. What really happened to Blockbuster?

[Jim Keys]

Yeah, I want to tell you because, see, Jack thinks I'm the idiot that turned down Netflix. He's. I know. He said it. He whispered it like, I think Jim turned down Netflix for 50 million bucks. No, I'm just kidding, Jack. Don't worry. But it's the difference between perception and perspective. And if that's what you think, you miss one of the richest case studies and one of the most amazing business lessons that exist out there today. So here's what really happened. Netflix was doing DVDs by mail. Blockbuster was preferred, the preferred model of the studios. We were their cash cow. So they came to us and offered to sell us a streaming video company. It was called MovieLink. They had already digitized 3,000 titles.

[Jack]

This is the studios.

[Jim Keys]

Studios did, yeah. Paramount, Sony, Warner, all came to us and said, buy this entity. They partnered on it to prevent the fragmentation that has happened today. They want to put all the digital content in one place to make it easy for the consumer and for them. And so we said, yes, we bought the entity. We bought a company called movielink. We changed the name to Blockbuster on Demand. And Netflix is still doing DVDs by mail at this point. Check one versus Netflix.

[Jack]

So you guys had the streaming before they did?

[Jim Keys]

They were working on it. You may remember a little box called Roku that they were trying to get. They had no content at all. So step two, content. We're approached by Viacom, one of the big studios, former owner of Blockbuster, and they said, hey, we're going to package up all the long tail content. You've already got exclusivity on the new releases. We're going to package up all the old movies streaming, and we'll grant you the rights. It was 100 million bucks a year. It's a big ticket, but we'll grant Blockbuster the rights. Nobody else would have anything to stream Blockbuster. HBO and Disney were going to be the only other content. Check two. Third, Google approached us. They had just bought YouTube, said, We're getting. Studios are killing us because people are. They're posting up free content on YouTube. Movie content. How about if we do a collab deal? Collaboration, distribution, collaboration, YouTube, everything free blockbuster, everything. Paid TV, movies, games, everything. Love it. My board signed it. It's front of their board for the definitive agreement is front of Google board. Now, had we gotten that deal? Check three. Check mate. And if Reed Hastings was on this podcast, he'd go, yeah, we were dead. But here's what happened. 2008, Lehman Brothers collapses. The General Motors in Florida go into the White House asking for a bailout. I wish I had a bailout. Nobody's going to give Blockbuster a bailout. We had a billion dollars of debt and the perception was we were going to file for bankruptcy. The Article came out in the LA Times and the New York Post. Blockbuster about to file. And all of a sudden I got a call from Google. Deal's off. No distribution deal. Can't justify $100 million exclusivity on content. Backed off Netflix, then acquired that content. Not exclusively, but now they had something to stream and the rest is history. We ultimately were forced into a restructuring. Still stayed the course, had to pivot from transforming the company now to saving the company. Took it through a restructuring, got it sold to Dish Networks and we live to see another day.

[Josh]

Where did all that debt come from originally? Was it from the rapid expansion of Blockbuster or where did the debt come from?

[Jim Keys]

Not at all. Viacom I mentioned previously, had acquired the company. Remember the name? Wayne Huizenga built Waste Management and autonation all these great. He was a great business guy. He's the one who really drove Blockbuster to be the company that it was. And so he sold the company for $8 billion to Viacom in I think 2000. Not sure exactly. They ended up coming, spinning it out into an IPO. So returning Blockbuster to being a public company in 2004 and put a billion dollars of debt on. Not an outrageous debt load. Is probably 2% of EBITDA at the time, but dial forwards. Much of that debt was due five years later. The year 2009. Third quarter of 2008, a whole financial market collapsed. Banks were shut. I got a third of a billion dollars. I've got to get refinanced. And that was what spooked my studios. And it wasn't even refinancing the debt that hurt Blockbuster. It was the fear of the studios that what if Blockbuster files. They took my credit terms from 90 days to cash and that. That forced our hand.

[Jack]

How did you originally get connected to be the CEO of Blockbuster?

[Jim Keys]

That's actually a fun story. I was out trying to buy the company because after a good run at 7:11 and knowing the power of technology, I was being approached by a lot of private equity firms saying, let's go buy something big. Private equity firms. So I said okay.

[Jack]

And you would be the CEO of that. Of whatever company you bought.

[Jim Keys]

Correct. And do a turnaround. And so I'm looking at. And I know this sounds.

[James]

They're like, we need to take that Jim Key sauce over here, man.

[Jim Keys]

Yeah. Because it worked. It's 7 11, you know, and we had a good run. We had a 10x increase in equity value. And the private equity firms love that. So. So I was looking. I had two targets. I know this sounds crazy. Now, Radio Shack and Blockbuster, remember those? Remember Radio Shack?

[Josh]

Absolutely.

[Jim Keys]

Think about Radio Shack. They're selling parts and pieces and all this stuff. But what people forget is they were the largest cell phone retailer in the world at and T stores, Verizon store, those didn't exist back then. So here's Radio Shack with a corner on the cell phone business and the computer business. They were selling Dells and Lenovo's and they wouldn't sell Apple though. So I'm sitting here going, okay, they've got hardware, Blockbuster's got software, content. What if you bang these two together and every cell phone that we sell through this store, we sell with Blockbuster inside free streaming. And then we do pay per view on the new releases just like we do in the stores and we sell the devices out of both the Blockbuster store and the Radio Shack store. Bang the two together. It was, here's the way I looked at it, it was a technology agnostic Apple store. If I carry a BlackBerry at the time and a Dell computer and a Sony tv, I can make them all talk. I put a person in every store like a little mini Genius bar and make it work. That was the vision. Private equity liked it. They said, yeah, we're going to back you. And they took me on a roadshow. And on that roadshow one of the potential investors picked up the phone and called Carl Icahn. And Carl was an existing investor in Blockbuster and he said, keys, just come, let's do this for Blockbuster. Forget about the Radio Shack thing for now. Let's turn around Blockbuster, put this in place and then we'll go buy Radio Shack later on. Trust me, you're an operator, I'm a financial guy, I got your back. And he did until he didn't.

[James]

For somebody that kind of is wanting to get into that acquisition game, like even whether it be buying massive companies like the big private equity companies that you're talking about, or even smaller size, like multi six figure companies, seven figure companies, somebody wants to get into kind of buying those companies. What are some things from your perspective being that you've seen it from all ends of the spectrum that would tell you to kind of avoid whether it be going into that industry as a whole or just, you know, like a particular company.

[Jim Keys]

I don't think there is any such thing as a bad industry because I think any industry can transform, can be transformed as long as they're willing to embrace change. What I'm looking for when I look at a company is have they, have they been able to Transform. Here's what happens. Blockbuster was the same. Radio Shack was the same. You get to a certain point in that fear creeps in and inertia creeps in. I call it big company disease. Seven Eleven had it. It's kind of what drove Seven Eleven into bankruptcy in the 90s. They just didn't want to change. To me, that is an absolute opportunity. Because if a company hasn't embraced technology and their institutional culture is keeping them from changing, let me add it, because that's a great opportunity to bring technology, to transform the culture and to leverage that. What could be a great brand into something completely different. Look at Apple back in the day, right? I wouldn't have used a Mac for a doorstop in 1990. And now look at what happened. They reinvented the brand.

[Josh]

You mentioned how Seven Eleven went into bankruptcy in the 90s. Blockbuster was lacking innovation, Radio Shack lacking innovation. And there's companies even today that lack innovation. I think there's a huge trend right now talking about the home services business, the boring business. And the reason there's such a big opportunity is because you can take a more traditional operator, an older operator, and implement technology and allow it to be a flourishing business, a more efficient business. When you. If someone is a owner of a business today and they're starting to have that realization that, hey, what I'm doing today may not work five years from now, what would be your advice to them?

[Jim Keys]

Bring in. Bring in people that will challenge you. Because the problem isn't with the individual or even the leader. Often, especially you said the magic words. They recognize that what got me here is not going to get me to the next level. If they're surrounded by people that are afraid and have that inertia, they're never going to get to the next level. So the best way to break that stalemate, if you will, culturally and organizationally, is have the confidence again. Back to that human resources thing.

[Josh]

You can't have the yes men around you.

[Jim Keys]

You can't have the yes men because they'll drag you right down. They'll yes you to death. And you've got to have people pushing you, making you uncomfortable, because that's when you learn.

[James]

Jim, we like to end these podcasts off with two questions for our guest. I'll start, and then Jack will go ahead and finish it. So my first question for you, I know I asked you it earlier, but I'm going to ask you again for the podcast. But if me and you died tomorrow and you had one more message to leave with the Younger generation. Generation. What would that be?

[Jim Keys]

Be fearless. You've heard me say it before. Fear is probably the single biggest killer of careers, of companies, and, candidly, even societies. If you think what's going on out there in the world and there is absolutely nothing to fear, if you use knowledge for things that can be known, and then if you turn inside and fall on your faith or the force, if you will, for those who don't know that combination of knowledge and your own beliefs, there's nothing to be afraid of, and you can accomplish absolutely anything.

[Jack]

I love it. And, Jim, how old are you now?

[Jim Keys]

Yo. We got through this whole podcast without.

[Jack]

Having to say that.

[Jim Keys]

Without having to say that, yeah.

[Jack]

Yes, sir.

[Jim Keys]

Big number. Hey.

[Jack]

Hey. Old enough to fly this rig right here?

[Jim Keys]

Yeah. Old enough to fly that? Yeah.

[Jack]

Several times a month. Yes, sir.

[Jim Keys]

But old enough that they're eventually going to take. Not. Let me keep flying that.

[Jack]

I got you. If it was all said and done tomorrow, how would you want to be remembered?

[Jim Keys]

I. Interestingly, I hope people will remember me for trying to make a difference. I'm doing what you guys are doing. I'm just at a. You're doing it at such a young age. It took me my whole career to realize that I think I can help people achieve a lot more and fulfill their true opportunity, their full destiny. And I'm not trying to do it, whether it's the book or doing it like this with podcasts. And you guys have such. I'm so envious, in a way, because you're already making a mark not just here in the United States, you're making a mark worldwide. And, I mean, I think humanity is on the verge right now of either going backwards with fear or going forwards and using knowledge in ways we've never seen before. That's what I believe. And you guys are helping to advance that mission of helping humanity learn how to learn.

[James]

I love that, Jim. And this was a beautiful podcast, my friend. We appreciate you, my man. Thank you so much, Jim. It means a lot for everybody. For everybody that's watching right now, we're going to put the links down in the description to Jim's social media, as well as Education is Freedom Man, a book that you wrote to help inspire millions of people. And also everybody watching right now, be sure to like and subscribe for amazing content and episodes we have coming every week with the most successful business owners, executives, moguls in the entire world. You guys just like the man. Jim Keys right here. But let's go a step further, guys. If you go down and click the link in the description. This is community. Let's take it a step further though. If you go down click the link in the description of this video, you can get access to join the number one entrepreneur community and network in the entire world with over 7,000 like minded entrepreneurs where you get direct access to live calls every week that we host with the 8, 9 and even 10 figure business owners that you see on the school of Hard Knocks. So we can't wait to see you on the inside. With that being said, we'll see you in the next episode.