Today’s guest is the former CEO of Apple and former President of Pepsi, John Sculley. Jason and John discuss the changing workplace and the unprecedented growth of company’s that talk directly with consumers. He also shares what’s going to happen to business plans, what a customer plan is, and shares the experience expectation.

Announcer 0:00
This show is produced by the Hartman media company. For more information and links to all our great podcasts, visit Hartman media.com.

Announcer 0:12
Welcome to the creating wealth show with Jason Hartman. You’re about to learn a new slant on investing some exciting techniques and fresh new approaches to the world’s most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine self made multi millionaire who’s actually been there and done it. He’s a successful investor, lender, developer and entrepreneur who’s owned properties in 11 states had hundreds of tenants and been involved in 1000s of real estate transactions. This program will help you follow in Jason’s footsteps on the road to your financial independence day, you really can do it. And now here’s your host, Jason Hartman with the complete solution for real estate investors.

Jason Hartman 1:02
Welcome to the creating wealth show, this is episode number 585. At and our guest today will be none other than John Sculley. That’s right. John Sculley the former CEO of Apple Computer and president of Pepsi, and author of moonshot game changing strategies for how to build a billion dollar business. So we’ll get to that here in just a moment. First, I just wanted to say, Wow, we are we are really excited about our upcoming Orlando, Florida property tour and creating wealth seminar on the east coast. So join us for that Jason hartman.com, early bird pricing still available, get your tickets, they are hot. We look forward to seeing you there, we’ve got a really great tour designed. And of course, we’re gonna do the seminar over two days, which I have come to love. It’s really a great way to do it. So I think you’ll enjoy that. That’s the creating wealth. And we are doing some nice revisions to that, based on our experience with Jason Hartman University, the inaugural Jason Hartman University event that we did in San Diego recently, we’ve been working on making creating wealth more interactive, and I’m super excited about that. So I think you’ll like it. And we’re going to have some changes to that it will be different. If you’ve attended that event before over the years. Look forward to a different type of event this time. I think you’ll enjoy it quite a bit. And venture Alliance, we are working on our venture Alliance trip, it will be in early 2016. And guess where it will be? Yes. Dubai, Dubai. That is what we are working on. And we think we’re going to pull it off our first foreign country adventure for the venture Alliance. So those of you in Europe who’ve been thinking about joining us, this will be a short, easy flight for you. Those of you in the US Wow. If you have not yet been to Dubai as I have not, I’ve been to 78 countries, but never Dubai. What an amazing, amazing place, we’ll probably do a side trip to Abu Dhabi. I’m just incredibly excited about that. And look forward to seeing the amazingness that is Dubai, the tallest building in the entire world. All of the other attractions man made islands, incredible, incredible structures, indoor skiing, indoor surfing, I’m not sure what activities will be doing yet. You may want to stay a couple of extra days as am I enjoy that because we won’t be able to put it all into a venture Alliance weekend, of course, but it’s going to be a phenomenal time. So hope you’ll join us for that here is a little I guess, you know, review or testimonial from one of our past guests. And that’s Jeff and Shannon who went on the trip. He left me a nice message at our website, Jason hartman.com. You can always leave voice messages there. I haven’t been reminding you of that lately. Which means I haven’t had too many messages lately. So I’d love to hear more of them. Your comments or questions on the show. This one is relating to venture Alliance and our last trip in Newport, Rhode Island. So just listen to him for a second.

Jeff 4:20
Hi, Jason. It’s Jeff. I was gonna send you a thank you card, but I thought knowing you you probably prefer a voicemail. Anyway, I just want to thank you for the outstanding venture Alliance event recently in Rhode Island. I really appreciated the opportunity to meet with such an accomplished and really likable group of people. It was a really valuable event to me to get a first hand opportunity to potentially invest in hard money lending presented by the Chessmaster mathematician Mike and the ground level apartment building redevelopment presented by Dave B on the business aspects. He did an impeccable job of organizing every detail the trip from The restaurant adjacent to the evening waterfire event, to the mansions, and the local tour of Rhode Island farms, even selfie sticks to capture the memories. Even during the social events, I had a number of valuable side conversations about business, real estate and health with other venture Alliance participants. From my experience, you’re just not going to meet people like this in everyday life. This was my first mastermind experience, but I can see how powerful it can be to intentionally put yourself in a position to be motivated, successful people with similar goals. Again, great event, Jason and I really appreciate all the work you put into making it fun and effective from a business perspective.

Jason Hartman 5:39
Hey, thanks, Jeff. I appreciate that little testimonial. Thank you so much. And that was totally unsolicited. So it was very nice of you to leave that message. appreciate it very much. If you’re interested in the venture Alliance, go to venture Alliance mastermind.com and check that out. Remember, when you’re a venture Alliance member, you get our property tours for free. Our meet the Masters event for free. So that’s all included with your membership. And of course we’ve got meet the Masters coming up. And we have Garrett Sutton Rich Dad adviser he’s written several of the Robert Kiyosaki Rich Dad advisor books from the Rich Dad Poor Dad fame. He will be speaking on Saturday at our meet the Masters event in La Jolla, California. And that will be in January. Of course that’s free as a venture Alliance member and we are going to have a venture lions VIP dinner on Friday evening. Garrett will be joining us for that. We’re working on another big name speaker as well. But again, look forward to announcement hopefully for that fairly soon. I wanted to tell you before we get to our guest today, John Sculley about some of our upcoming shows, we’ve got the ABCs of real estate investing coming up next, we will talk about aitd is all inclusive trust deeds or wraparound mortgages, and we will go deep into adjustable rate mortgages so that you have a good understanding of how they work. Not that I recommend them very often. Rarely do I recommend adjustable rate mortgages. But I think just having a deep understanding of how those loans work will be very valuable to you in general. And then our flashback Friday episode will be Rick Adelman. 10 great reasons to carry a big long mortgage and never pay it off. Of course, he’s the highly acclaimed financial advisor and best selling author of many books. I’m certainly not a stock market fan. I think Wall Street is the modern version of organized crime.

Boy, I am a fan of Rick Adelman, he, he really provides some good information out there. And then on Monday, trend Griffin higher up with Microsoft. He has spent some time writing about the best friends Bill Gates and Warren Buffett, he will be talking about Warren Buffett’s right hand man Charlie Munger, okay and his his book is entitled Charlie Munger, the complete investor. Then we’ll have Jeff Barnes. On Wednesday, the following Wednesday, talking about self directed investing, and retirement planning. We’re gonna go deep into that subject with some advanced strategies. flashback Friday, we’ll be creating wealth, bootcamp debriefing, analyzing to real estate investor case studies. And then the following Monday we’ll have Megan green chief economist with Manulife and John Hancock asset management, she provides some good info. I will be doing the episode that following Wednesday, and I don’t know what I’m going to talk about yet, you know, I just never have anything to talk about. I’m just kidding. Of course, you know, that’s not the case. And then flashback Friday, timeless wisdom from Earl Nightingale and Dan Sullivan, and some listener questions answered. So some really, really good stuff coming up. Well, without further ado, let’s get to our guest today. And of course, that is John Sculley. We’re going to hear about his work with Steve Jobs. His work at Apple as the former CEO a lot of growth Apple experienced under his tenure, and of course, Pepsi as well. So let’s get to John Sculley. Remember Jason hartman.com Orlando, Florida property tour and meet the Masters coming up and venture Alliance mastermind.com for info on the venture Alliance. Here’s John Sculley.

It’s my pleasure to welcome John Sculley. He is the former CEO of Apple and the former president of Pepsi. He’s the author of a new book entitled Moonshot! Game-Changing Strategies to Build Billion-Dollar Businesses. And you’ve certainly heard his name. I’m sure you’ve followed some of his work over the years. John, it’s great to have you.

John Sculley 9:55
Thanks. Real pleasure to join you.

Jason Hartman 9:56
Where are you located by the way,

John Sculley 9:58
I live in Palm Beach. Florida. And today I’m happy to be in New York City.

Jason Hartman 10:02
Fantastic. Well tell us about Moonshot. I mean, you’ve got such an incredible background, I’m sure you’re bringing a lot of that force in the book and want to hear about some of your other projects as well.

John Sculley 10:13
Well, I’m a consumer brand builder. And I’ve always been involved with things that have to do with consumers, whether it’s Pepsi, or Apple, or many of the companies I’ve worked with, since then. And I’ve never quite seen anything like what is happening right now. Not about the future. But right now, and that is that these incredible technologies that are growing at exponential rates, cloud, mobility, data, analytics, Internet of Things, all of these together are causing a derivative effect, which is the power shift from large incumbent companies that have long been in control of their markets. And suddenly, new companies are coming along with death, better ways to do things, products and services. And they’re able to talk directly to consumers and consumers are paying more attention to the opinions of other consumers than they are to the incumbents. And what this means is, you see these companies grow at just incredible rates from standing Star $2 billion companies, and we’ve never had anything like this before. And we’re only at the beginning,

Jason Hartman 11:17
That’s good for consumers, because it’s really more of a pool marketing nowadays than a push marketing that old fashioned, you know, spend a zillion dollars advertising and, and get the word out now it’s the consumers are pulling products and services through that funnel, right? Is that is that kind of what your point?

John Sculley 11:37
Absolutely and and it’s really democratizing the entire economy, in terms of you think about the beginning of the Industrial Age, it was all about a few important technologies, like the steam engine, for example, or the early days of transportation with automobiles. And we’re now in an era where, what is driving the economy, our consumers, and consumers have just incredible power they’ve never enjoyed before. And it’s coming through their smartphones, it’s coming from the clouds. It’s coming from sensors that are being connected to more and more hardware and systems. And these are literally changing everything that we’ve ever known about what an economy looks like. And it’s really quite exciting if you’re an entrepreneur or want to become part of an entrepreneurial company,

Jason Hartman 12:25
But to an entrepreneur, it really means that you have to just do better, you have to produce better products, better services, because nowadays, it so much of it is about the reveal, it’s about consumers talking to each other and engaging on social networks, right?

John Sculley 12:43
Absolutely. And you can see some great success stories. And you can also see some of the most famous brands have the backs up against the wall. Let’s take for example, McDonald’s that only a few years ago, would have been considered one of the most successful biggest, most powerful brands in the world. And yet, you see now that new fast food companies with fresher ingredients and a better experience for the consumer, shorter wait time in line to get the product, better atmosphere in terms of where their stores are located. Suddenly, they’re taking away a lot of the business. And that’s because it’s all about consumers telling other consumers, hey, there’s something better out there. And I just use McDonald’s as an example. It could be many, many other companies that have been leaders in the past. They’re incumbents, but they suddenly are faced with new challenges.

Jason Hartman 13:37
Yeah, they really are. They really are. Okay, so how do we use this? I mean, in moonshot, you talk about this a lot. What does an entrepreneur today or an intrapreneur, maybe with a large company to what do they need to do to use that information? That is changing the landscape?

John Sculley 13:54
Well, first of all, let’s look at how the workplace has changed. That it used to be that maybe 5% of the workforce, were independent contractors, meaning that they didn’t actually work for a particular company, but they were contracted by companies while that number is already up to over 25% and is expected to go to 40% of the workforce are going to be independent, they’re not going to work directly for a single employer, they’re going to be basically working for themselves on a project basis in a agreement or contract relationship with employer. We’re also saying that not only are workers becoming more independent, but we’re seeing that it’s possible to join entrepreneurial companies. You don’t have to be the founder of the entrepreneurial company, you may be an employee of the entrepreneurial company. And this means that there’s a real incentive for anyone coming into the workforce, particularly younger people to say, what kind of preparation Do I need to be able to get jobs in these new entrepreneurial companies? How are they going to Measure me in terms of my skills and my progression. And that’s what moonshots all about. It’s not my autobiography, it’s it’s stories from entrepreneurs like myself, what we’ve learned and quite honestly, we’ve learned more from our mistakes than we ever did from our successes. And we try to pass some of these, these learning things alone.

Jason Hartman 15:20
John, when you created the Pepsi challenge, I mean, that was a pretty innovative thing back in the old days when that came about, right?

John Sculley 15:27
Well, it really was because it was just radically different from the way people had been marketing big brand products. And in this case, we said, Let the consumer speak for themselves instead of the manufacturer saying, Hey, I got a better product. We said, Let’s go out and do a taste test. And let’s, you know, put the two most famous cola brands in the world up against each other on a blind taste test. And let’s see what happens. And guess what, when we went down to markets, where Pepsi was outsold 10 to one a lot of people don’t realize that Pepsi, back in the early 70s, was actually a strong regional brand. It wasn’t a nationwide brand the way it is today. And so you could go to markets in Texas, we started the Pepsi challenge in San Antonio, Texas. And we were outsold 10 to one many people have never even dreamed of having a Pepsi. So they had no idea what it tasted like we ran a blind taste test. All we were interested in were the responses from Coca Cola drinkers, who when the reveal was shown what strength is selected, discover that they chose a Pepsi, not a coke. And that was a pretty big piece of news at that time.

Jason Hartman 16:38
Right. Right. And but but that’s really what you’re saying today, you know, is that the consumer, that was maybe one of the first examples in any, in any big way of how the consumer was driving the marketing. And that Pepsi challenge, of course, became very, very famous. I remember those commercials as a kid.

John Sculley 16:58
Yeah, well, and guess what. Steve Jobs liked them, too. And that’s what really attracted him to come and talk to me about joining Apple. Keep in mind that in the early 1980s 1982, when Steve and I first met, that nobody was talking about consumers in Silicon Valley, there was no such thing as high tech for consumers, maybe there were a few game machines and things like that. But the reality was, these were the early early days in Silicon Valley, and certainly early days for personal computers. And Steve had this idea which people thought was outrageous at the time, he said, he believed that the personal computer was going to become a tool for the mind, but not just for technical people or business people. He wanted us for non technical people. He wanted it to be so easy to use, that non technical people could do creative things with it. And the creative thing that we promoted during the 1980s was desktop publishing. And so it expanded what we thought about computers. Back in those days, computers were in big rooms with glass walls and air conditioning, and spinning. tape drives intimidating look at the spinning like the computers we have today. And so the whole idea of experience marketing, as we call it back in those days at Pepsi, was you sell the experience, not the product. So when we introduced the Macintosh, about a year after I had joined Apple, we showed a commercial at the Superbowl in 1984. And we never showed the product we didn’t have or talked about the details of the product. What we did is we set the expectation of this incredible experience as a creative machine that was going to change the world.

Jason Hartman 18:46
Yeah, fantastic that it really did, did change things. I want to get back to moonshot a little more in a moment and the idea of a customer plan and you know, how much relevance business plans have, but since you brought up Apple, can you tell us a little bit more about your experience at Apple and with Steve Jobs? You know, I’m sure people would love to hear about that. It’s

John Sculley 19:06
Sure. Well, I moved into the wireless operator industry after Apple. I was part of the team that built from the start a company called Metro PCs, which was one of the really successful next generation wireless operators using digital technology eventually became a $9 billion company and we sold it to T Mobile is now the centerpiece of T mobile’s company. And I’ve been involved with a number of other consumer businesses helping build a new company at the time called hotwire which is a travel service. I’m currently working now on a number of new consumer businesses. One is in telehealth, a company called MD live, which is giving virtual care virtual visits for an accredited doctor in a matter of a few minutes who can stay I think it’s necessary write a prescription for you. And it can be delivered by courier to your home within less than an hour. And I’m also involved in just launching a brand new smartphone. Because many parts of the world are growing at incredible rates to growth as a convert from low bandwidth to high bandwidth as we enjoy in the United States. These people can’t afford an $800 smartphone. And so we have designed a product in Silicon Valley, the former Apple team, by the way, who worked with me and get Apple are the ones who did all the creative work. And this is called ob world phone. And we’re rolling out right now into 70 of the fastest growing smartphone markets in the world. And it’s just beautiful design, great fit, finish, but no compromising technology. It’s hundreds of dollars less expensive than the leading brands.

Jason Hartman 20:49
So John, that’s amazing, you know, the UN had that $100 laptop program. And I don’t know if that ever got anywhere. But a smartphone is a very good choice for developing countries, what will the price of this be, and when will it launch?

John Sculley 21:03
Well, smartphones are typically sold at about 600 to $800. Because in the world outside the United States, they don’t come bundled into a two year contract, you buy the data service plans separate from the phone itself. And as good as some of these high end phones are. They’re just too expensive for the majority of the new middle class in emerging markets around the world. So we price our ob world’s phones, several $100 lower than that we’re down starting at about $129 or less. And we go up to about $199 us so significantly below the premium end of the market, but no compromise in the technology. And we do it with a much leaner organization. And we had just beautiful design and materials and technologies. Because we’re doing all of these products are being created out in Silicon Valley by many of the people who work with me at Apple,

Jason Hartman 22:03
That is really, really amazing. I’m sure it will have a lot to do with bringing the next billion people online. So congratulations on that.

John Sculley 22:10
And that’s what inspires us too. You know, we’ve got to connect the rest of the world. And not everybody has the same affordability as we do here in the States. And we can build products that don’t compromise, and yet give people just a wonderful experience. We’re not trying to copy. iPhone, we’re not trying to copy Samsung, are the only things that are totally original. And so far, people just love them.

Jason Hartman 22:35
Fantastic, fantastic. Back to the book in the business climate nowadays, or business plans even needed anymore. Are they even relevant? We saw that, you know that the big 60 page business plan has disappeared in favor of much shorter plans. You know, what, what’s the status of the old business plan?

John Sculley 22:53
Well, here’s the problem with the old business plan’s fast-changing world we live in. And that is business plans always start by looking back before they look forward. So they say so how did we do in the past? And how much improvement can we have going forward. And then they’re basically about allocating resources amongst various competing opportunities within an organization. The customer plan, on the other hand, is quite different than the traditional business plan. Think of the business plan as a budget exercise, the customer plan, says, Let’s start with what’s on the mind of the customer? What can we do to give the customer an exceptional customer experience? And how can we improve the ways that we attract customers and get them engaged? How do we get customers to stay on and be part of our community? How do we monetize customer so everything in a customer plan is looking forward? It’s not looking back as a starting point. And customer plans for entrepreneurial businesses are particularly important because the reason for an entrepreneurial company to even exist is to do something that isn’t already being done by a large established company. So the customer plan is far more important for companies that are trying to grow and break out and be transformative than the traditional business plan or budgeting process.

Jason Hartman 24:18
I think that’s a great way to look at it. You know, when moonshot you talk about starting with a noble cause. And obviously Apple Computer started with a noble cause like that democratized computing. With your new smartphone, you want to help bring that next billion people online and connect the world? Can you give us any other examples of noble causes, or maybe how people listening can find their noble cause if they can’t think of what it is already?

John Sculley 24:46
Well, this may surprise people but in all the meetings that I had with Steve Jobs and Bill Gates, going back to when they were adults in their 20s, and we were talking about so what’s the world’s gonna look like? None of us ever had a conversation about making money. It was always about. So how do we do something that’s going to make a difference in people’s lives? And that’s our noble cause. Now look at what is Mark Zuckerberg doing at Facebook? He’s talking about connecting people to people. That’s a noble cause. Now, what did Larry and Sergey do at Google? Now they had a noble cause let’s connect people to information and make it accessible and usable. Or what did Steve Jobs do with iPhone? No, he connected people in a mobile way to a whole bunch of services called apps. And so these were really big ideas. And why that’s so important, more important than thinking about making money is because it enables you to attract the best talent in the world to want to work with you, because people love being part of a noble cause. And it also gives you great focus, because you know what you got to do, you got to achieve a noble cause. And it creates urgency. And these are all important attributes of the most successful company. So I always tell entrepreneurs, try to think of what you’re up to, in the context of a noble cause something that’s good for the world, good for society. And then it’ll become more obvious how you can make money from it.

Jason Hartman 26:17
I think that is great, great advice, John, you know, it’s interesting that in the moonshot book you you have, in part two, you talk about changes in the middle class, a lot of people wouldn’t expect a section like that in a, in a book about building businesses, you know, what’s really going on in the US and with the exploding middle class around the world?

John Sculley 26:38
Well, I’m old enough that I can actually remember the US. If you grew up in the 1950s 1960s, the middle class was taking shape, we were just getting really a true homogeneous marketplace in the US with the interstate highway system, the first network tellement, things that were fundamental like women coming into the workforce, all of these things shaped our middle classes were as we know it in the United States. Well, guess what the rest of the world has the same aspirations to become middle class people too. And they’re doing it in very different economic circumstances, so that they may not be aspiring to a suburban house, with two cars in the garage, but they may be looking at an apartment in a city. That’s pretty small apartment, and they may or may not have a car, if it is, it’s probably a small car. In other words, their context as to what it means to be the middle class is really quite different than ours. And so if you think about the products and services for that middle class, which we’re talking, by the way about the next billion people joining worlds middle class, you have to rethink each of the products and services in a way that it makes sense for the economics of that part of the world, the emerging markets. And that’s why with our ob world phone, we said we’ve got to figure out how to make a really good smartphone. For people who can only spend 150, or $200, they don’t have $100, to go out, buy a premium product anymore, they have $60,000 to go out and buy an automobile, which which many middle classes might aspire to here in the United States, you gotta have one that’s $7,000 $8,000.

Jason Hartman 28:27
Are there any examples of where someone can find a customer plan? My mind just wants to go to where that that is written where I can see an example of it.

John Sculley 28:37
If you want to get the details of a custom plan, I lay that out quite thoroughly at Moonshot. You get Moonshot at Amazon, audiobook, or ebook, or a hardcover book. But the reality is that a customer plan is just a lot of common sense. It says, if you want to build a billion dollar business, or $100 million business, you pick the number, then you got to go out and solve a big problem, a billion dollar problem or $100 billion problem. So you got to start with the customer. What What can you do to make customers happy? How can you find a better way of doing something that’s already been done? Those are the kinds of curiosity and questions that one should have, as you start to contemplate building a customer client always starts with the customer. No surprises. And then you need to think about not the technology. But you need to think about, you know, what is the end result of the customer? Or what’s the experience, you know, why should they want to choose your service or your product over what’s already available? And only then when you start to conceptualize it around the interest of the customer? And how do you motivate a customer to change their behavior or adapted to the product or service that you’re proposing? And only then do you start to think about Okay, so what does it mean? technologies that might help you get there and define that product or service.

Jason Hartman 30:03
Excellent. I think that’s, that’s great advice. John, give out your website if you would and tell people where they can find out more books on Amazon, Audible, etc. But you have a direct website right?

John Sculley 30:12
I do. It’s real simple Johnsculley.com and you just go J O H N S C U L I.com

Jason Hartman
Fantastic. Johnsculley.com, it is truly an amazing time to be alive. It’s an amazing time to be in business to be an entrepreneur. And John, any final words before we let you go.

John Sculley 30:33
You can also go to go to sculleyspeaks.com.

Jason Hartman 30:36
Excellent, good stuff. John Sculley. Thank you so much for joining us.

John Sculley 30:39
Thank you.

Announcer 30:41
This show is produced by the Hartman media company All rights reserved for distribution or publication rights and media interviews, please visit www dot Hartman media.com or email media at Hartman media.com. Nothing on this show should be considered specific personal or professional advice. Please consult an appropriate tax legal real estate or business professional for individualized advice. opinions of guests are their own. And the host is acting on behalf of Platinum properties, investor network, Inc. exclusively.