Calm App Founder: From $0 To $2 Billion By Making The World Meditate: Michael Acton Smith

[0] Solving the global mental health crisis, it's a first -order problem.

[1] One in three of us will experience depression or anxiety.

[2] And I realized that this could be one of the biggest opportunities and businesses in the world.

[3] Michael Acton -Smith, he's the billionaire founder of the mindful meditation and sleep app, calm.

[4] Everyone thought we were crazy.

[5] The bridge between the seed money we raised and getting to a series A took years and years.

[6] And then that was where the point was like, we're taking off, it's happening.

[7] Never have we been assailed with more noise and stimulation from social media to billboards to TV.

[8] It's coming at us constantly.

[9] One of the most valuable skills in the 21st century is to be able to decide where and how and when we put our attention.

[10] The human brain is the most complex thing in the known universe, and yet it doesn't come with an instruction manual.

[11] Michael Acton Smith, he's the billionaire founder.

[12] of the mindful meditation and sleep app, calm.

[13] For the last 10 years, Michael has been one of the great UK entrepreneurial success stories, but the really staggering thing about Michael's story is how many successes he had that turned quickly into failures.

[14] And honestly, how he rose time and time and time again from those ashes to rebuild an even more successful business.

[15] Most people would give up, and you almost wouldn't blame them when you hear what Michael's been through.

[16] His most recent success, Car Map, is worth billions and billions of dollars, and it helps people who are going through hard times or any pain at all reach mindfulness.

[17] It teaches them the importance of slowing down, stopping, and meditation.

[18] So one would think Michael had an easy life, and he was the master of his mind.

[19] But he goes through the same battles as everyone else.

[20] and he describes this last year as the hardest of his entire life.

[21] Michael, thank you for being so honest on this podcast.

[22] Thank you for your vulnerability, because I know this conversation is going to help everybody that takes the time to listen to it.

[23] So without further ado, I'm Stephen Bartlett, and this is the diary of a CEO.

[24] I hope nobody's listening, but if you are, then please keep this to yourself.

[25] Michael, you've been described in the press as this kind of like entrepreneurial, rock star character and when I read through your story I was surprised and inspired and blown away by how early that entrepreneurial bug appeared in your life.

[26] When you look back at your younger years, are you able to pinpoint what you were good at the thing that made you different from your peers in terms of your skill set or talent?

[27] I'm not sure.

[28] I was very impressively mediocre at school.

[29] like right right in the middle definitely not in the top set for anything but i think i if i had to pin down one characteristic it would probably be curiosity i was just fascinated by lots of different things and my dad was a librarian he used to bring books home for me and my sister all the time on all sorts of random subjects and i just devour them and so i think that kind of sparked this interest in in different areas of life and I think when you start when you're curious um everything becomes interesting in life everyone you chat to every magazine you pick up every country you go to and uh you start to kind of connect dots between different things and I think that's a really important part of the entrepreneurial mindset that inspires creativity then right because if you're if you've got so many dots to pick from you can create new things right exactly yeah so I think you know along with curiosity I I think creativity is part of it as well.

[30] I love ideas.

[31] I love taking the random things that are kind of rattling around my head, putting them onto a sheet of paper, playing around with them, thinking about them from different angles, and then taking the best ones and putting them out there in the world.

[32] And this is the beauty of being an entrepreneur.

[33] You know, you can talk about stuff endlessly, but only when you meet the market, do you find out whether there's any merit to your ideas?

[34] And you can see whether people actually resonate and use or buy or talk about whatever it is that you're creating.

[35] I just love that.

[36] Sales, your sister said that I had a little story she told about you going to Carboot Sales and being a really remarkable seller when you were younger at Carboot Sales.

[37] What role was that apparent when you were younger that you had a talent for selling things?

[38] I don't know if I've ever thought of myself as a good salesperson.

[39] I think I get very animated and energized and passionate about things I really, really believe in, which I think is probably a key part of being good at selling things.

[40] Yeah, we used to, it was one of the many, many endeavors when we were younger going to car boot sales and selling things and trying to match them with the people that were walking by.

[41] So interesting, she said that.

[42] I never knew that.

[43] Did you fit in?

[44] Not really.

[45] No, if I'm honest, I was a little bit of a square peg in a round hole at school.

[46] was quite small for my age, and just didn't quite, it's hard to describe, but didn't quite click or understand the cool kids and kind of what was going on.

[47] I think maybe that sort of forced me to kind of retreat into myself a little bit.

[48] I became very passionate about reading, as I mentioned.

[49] Kind of went down the path more of sort of social pursuits rather than going to parties and events, and I was pretty introverted and shy.

[50] until I got to university.

[51] Were you ever bullied in school?

[52] Did you ever...

[53] I wouldn't describe it as bullied, but I would certainly not class myself as one of the kind of the cool kids, sort of on the periphery looking in rather than in the centre of everything that was going on.

[54] And then at university, that changed something.

[55] It did.

[56] I kind of, you know, the beauty about university is you can reinvent yourself and you leave all the kind of sort of perceptions and views that people have of you when you get there and so met some amazing friends and i just decided to kind of lean into everything joined every club going chatted to everyone i could it was a big kind of flip and some of my best friends now you know i met at university during that period and on that point of um identity when you got to university you could you could finally start i guess exploring your who you actually are and you shed that identity from school shed a lot of the maybe limiting beliefs about public perceptions of who you were and at some point that went on to starting firebox later in firebox was a bit later on right 1998 exactly yeah so um tom who i met at a university and i were always talking about business ideas but when we left university we both got sensible jobs you know we were in debt uh and needed to um make some money and so my passion at that time was I wanted to become a trader in an investment bank.

[57] I'd watch Wall Street and thought it was the most interesting world ever, you know, snapping the red braces and just kind of buying and selling and dealing.

[58] And I lived in a little town called Marlowe, and I saw in the newspaper that there was a job ad for a leasing company, company cars.

[59] And it said you will be working with investment banks in London.

[60] And I didn't know anyone that worked in the city.

[61] I did a geography degree so I couldn't go in through the front door to get a job in a bank so I thought this could be my route in so I got the job and just worked as hard as I could try to get noticed and I got put on the Goldman Sachs account and I thought this is amazing I travel up to London two days a week and got to work in their officers in the HR department and I remember reading the FT and the economist and when I'd meet the traders I'd like throw in kind of random tips about things I'd read, hoping I'd get noticed and invited to join the company.

[62] Of course, that never happened.

[63] And what I realized was that this probably wasn't the world for me. It didn't kind of click.

[64] It was great to kind of try on that jacket for size to see what it was like.

[65] But it just didn't kind of speak to my soul.

[66] It just felt a bit false.

[67] There was no creativity to it.

[68] And so after about six months or so, stepped away from that.

[69] And that.

[70] Tom had left to, he was programming breathalisers in Wales, which was quite an entertaining job.

[71] He'd have to drink Kansas Stella to calibrate these breathalisers he was working on.

[72] They were used by the police.

[73] But we both weren't, we both weren't clicking with what we had.

[74] And, yeah, we'd meet up and talk about business ideas.

[75] And the internet was just starting to kind of really gain momentum, sort of around 97, 98.

[76] And it was during one of our chats in the pub that the last.

[77] light bulb went on and we realized that maybe we should leave and set up our own business.

[78] So take me through that journey.

[79] So you hand in your resignation at some point or do you start while you're still at that company?

[80] So it was a little bit of crossover as there usually is kind of thinking about the idea.

[81] But once the idea that Tom and I were chatting about just became so all consuming, that was the moment when we like, right, let's dive into the unknown, leap out of the airplane and figure this out as we are plummet to earth.

[82] And Tom was living just outside of Cardiff.

[83] And I remember we were again walking around town chatting.

[84] We went into a bookshop and we saw this book that was called Doing Business on the Internet.

[85] And we knew we were both aware Tom did AI and computer science at university.

[86] So we knew something was going on in this world.

[87] But we clubbed together.

[88] We put 10 pounds in each to buy this book, which was a lot of money for us living pretty much hand to mouth.

[89] And I just remember reading it and just having my mind blown by, you know, what felt like what was coming.

[90] This was going to change everything.

[91] How we did commerce, how we connected with each other, how we were entertained.

[92] And Tom was just fascinated by this book as well.

[93] So that was kind of that became our Bible to create what was Hotbox, which then became Firebox, the gadget, the games, the sort of online retailer.

[94] And so that was like, kind of like an obscure gift um gadget online retailer yes yeah we felt that you know again this is the early days of the internet it was um predominantly uh young youngish people who were on it who were sort of figuring out how to um connect it it wasn't the easiest thing in the world a well was just kind of getting going the search engines weren't fully developed um it was a lot more men than than women on the internet at this time.

[95] And we thought, what if we could sell an usual toys and gadgets and games, kind of quirky stuff?

[96] And it was sort of inspired by the innovations catalog and sharper image in America.

[97] And so that was the idea.

[98] And we would find products that we thought were quite cool.

[99] We would list them online.

[100] And then when someone bought them, we would then go and buy the product from whoever was selling it because we didn't have the cash flow to hold anything in stock.

[101] and then send it out to the individual.

[102] It certainly wasn't Amazon next day delivery.

[103] It was pretty clunky.

[104] And the payment systems at the time.

[105] Well, this is really interesting because, you know, around this time when we told people we were going to set up a business online, we got a few different reactions.

[106] One was that eye rolling, people would tell us no one is going to buy anything online.

[107] You know, you have to put your credit card in line and, you know, who's going to do that far too risky and dangerous?

[108] So that was the prevailing wisdom.

[109] The second feedback we got was that the only people making money online are kind of porn barons.

[110] But we were like, no, we think there's a revolution happening here.

[111] We think, look at all the mail order catalogs, look at the money being made.

[112] The internet is a much more efficient way of doing this.

[113] And this is long before Shopify, long before Stripe.

[114] So Tom was the technical genius.

[115] He kind of built a website, and we couldn't figure out how to take payments online.

[116] So what we had to do was if you wanted to order anything from our site, you had to find the product you wanted.

[117] Then you had to print out an order form.

[118] Then you had to fill it in with all your details.

[119] Then you had to write down your credit card details.

[120] Then you had to fax that to us using JFax.

[121] I would print it out, type all the details in.

[122] We had a PDQ machine from the bank that I would manually type in.

[123] And then that would take the money.

[124] And then I would put the product once it arrived in a package and send it out.

[125] it was incredibly inefficient and fortunately we only had about one order a month so it was we certainly weren't in danger of setting any kind of commerce records but it it just it was it was a very interesting period many months this went on and it just allowed us to kind of sort of test the systems and figure out what was going on and day by day just get a little bit better and we had an amazing friend called matt shone who we also met at university and he would use secret names to order from the site to kind of cheer us up and let us feel that there were people out there buying these products.

[126] He only admitted that to us a little bit later, but that kind of kept our energy and our spirits up as kind of we sat there waiting for orders to come in.

[127] What was the heights of that website?

[128] What was the highest moment?

[129] Well, amazingly, it's still going now.

[130] I saw it earlier on.

[131] A quarter of a century almost it's been going, which is mind -boggling to think.

[132] An internet company, I think that the real kind of a tipping point for that business was when we made our own products.

[133] So instead of selling other people's products where the margins were just very thin and you could buy from other places, we developed our own IP.

[134] And that was a real kind of light bulb moment for me, recognizing that to do anything in business, you've really got to create something yourself, you know, make something that hasn't existed before.

[135] So during one of our many board meetings and creative sessions in the pub, Tom and I, Tom and I were watching someone line up tequila shots across the bar.

[136] And this turned into a conversation of they look like pawns on a chess board.

[137] You know, what if we could create chess, but make it more interesting, turn it into the drinking person's thinking game.

[138] And you could have 32 glasses on a board and you fill them all with alcohol, red wine against white wine or whiskey against vodka, if you're very hardcore.

[139] You move the pieces as normal, but every time you capture a piece, you have to drink it.

[140] So you could make a queen sacrifice, which would be like three shots, make your opponent very drunk and hopefully kind of balance things.

[141] And we just thought this was a really unusual idea.

[142] And we sent out a press release for it to a bunch of magazines.

[143] We didn't know about PR companies who went into W .H. Smith one day and scribbled down all the addresses and the names of the editors and sent this out.

[144] And the reaction was amazing.

[145] We suddenly had all these magazines wanting to hear about this incredible shot glass chess, set.

[146] And so the other light bulb moment there was storytelling.

[147] You know, do something different.

[148] We created this story about these two broke ex -students who'd made this game.

[149] And we were in FHM and loaded and maxim.

[150] And we made the local Welsh newspaper.

[151] And we even made it to page three of the sun, which was quite exciting.

[152] Not the main picture.

[153] Fortunately, no. I was going to say you or two.

[154] Definitely.

[155] No one wants to see us.

[156] But, yeah, a little snippet, and suddenly the orders just started to pour in.

[157] It was a real goose bump -inducing moment.

[158] And so there's two things, there.

[159] I want to just touch on the lesson you said you learned about PR and storytelling.

[160] I'm guessing that's a lesson that stayed with you till today.

[161] Oh, boy, absolutely.

[162] And what are the principles of that lesson?

[163] What's the principles of storytelling for you that you learned, done?

[164] Well, everyone is interested in the human angle.

[165] You know, if you look at every article about a business, it almost always centres on the human angle, the stories of people using that products, the lives that have been transformed.

[166] You know, storytelling is such a powerful way of communicating and connecting with other people.

[167] The struggle, the resolution, the transformation at the end.

[168] There's an amazing book by Will Storr called The Science of Storytelling, which kind of talks about this in great, great detail.

[169] And I think about it with every business I create, every time I'm pitching my business to investors or trying to encourage someone to join.

[170] So it's a key piece, I think, of the entrepreneurial journey.

[171] And so, yeah, we realize that, you know, if we could, instead of putting out press releases saying, this is our business and this is how much money it makes and this is our margin, you talk about the human angle and the story and the struggle and those aspects.

[172] And it makes it much more interesting.

[173] And at some point you decided to depart from this business?

[174] Yes, yeah.

[175] So this was many years in.

[176] The business was going well.

[177] We'd built a team.

[178] We'd moved from Wales to London.

[179] We went to one of the first Tuesday events.

[180] I don't know if anyone listening remembers, but we read about this in The Guardian, this networking event where entrepreneurs and investors came together to do deals.

[181] and yeah we were living in this attic in Cardiff and we thought oh my goodness we need to be in London the promised land where the streets are paved with gold so literally within a few days we just piled up a van and drove to London and went to this event and the very first one we went to we met an investor who are we met with him and the team and they invested in the business and we were just like blown away so yes firebox grew for many years got got much much bigger but after a while I decided I wanted to try something new.

[182] You know, the entrepreneurial brain had been whirring away.

[183] There was a new concept I was incredibly excited about.

[184] And I had some very honest and important chats with Tom.

[185] And I stepped away and created mind candy, which was the next big adventure I was about to embark on.

[186] Why did you step away, though?

[187] So you're saying there that you kind of ran out of love or excitement for the business ultimately?

[188] Were you at this point personally financially free and stable?

[189] No, no, quite a long way from it.

[190] You know, we'd been building the business.

[191] We hadn't sold any shares.

[192] We hadn't taken any money out of the business.

[193] We were paying ourselves a very modest salary.

[194] And it was a challenging business to run.

[195] So we certainly, we were, we were stable.

[196] We were profitable because we kind of had to be, but it certainly wasn't throwing off a lot of cash.

[197] But I just felt that I was I there was a new idea that I just couldn't stop thinking about that was waking me up every single night at 4 a .m. And I just felt I had to answer that call.

[198] And I certainly didn't want to leave Firebox or Tom or the team in the lurch.

[199] So again, we had some very important conversations as I mentioned.

[200] But yeah, I felt I had to go and do something new.

[201] And the internet had evolved quite a bit since the first, you know, the web one era, web two was just gathering pace.

[202] you know it was not just the read web it was the read right where people were creating crowdsourcing and it just felt like i i had to yeah i had to answer this call that's really interesting you described it as a call i was i was trying to think about a way to um give advice to entrepreneurs that have lots of ideas as all entrepreneurs and creatives do um how to filter out the ones worth pursuing and i was i was saying one of the things i think i've done over the years in hindsight is there's almost this sunday shelf in my mind where like new ideas come i put them on the Sunday shelf and if they like nag me and if they stay at the front of the shelf and like Steve you know then I'll pursue them but if they kind of fade off into the background and collect dust and vanish yeah then I don't pursue them it sounds like you're talking about a similar mental system where if it nags you long enough you pursue very very very true and I think this is a really important point there's a lot of entrepreneurs many listening to this podcast who probably have a great idea maybe they've started maybe they're still thinking about it and What I think is fascinating about this current moment in time is it's very easy to start a business.

[203] You know, there are so many tools out there to use and build upon to get going on day one.

[204] There's a lot of investment chasing great deals.

[205] And I think that's a positive thing and a negative thing.

[206] And I see this.

[207] There are too many people that just launch before they fully bake their idea.

[208] They haven't built the foundation of the skyscraper they want to build.

[209] And so they raise the money.

[210] They build the team.

[211] but they're being blown around like a paper bag as soon as they get new information.

[212] And that's a scary place to be spinning around once you've got a team, once the clock is ticking, once the investors are on board.

[213] What I would strongly urge, and I've done this with every business I've set up, is go slow to go fast, do the work up front, spend months, sometimes years, researching what it is that you're intrigued about, marinate yourself in this idea.

[214] you know, go to the business conferences, read every book you can, the documentaries, speak to people in the space, and a really interesting thing starts to happen.

[215] You start connecting these dots, this invisible work that no one else may be aware of, is you finding the magic, finding the secret to this industry, discovering whether the opportunity is, where the alpha is.

[216] And once you've done that, you get to a point, as you say, whether it's the front of the shelf or whether it's, for me, it's the idea that just wakes me up every single night.

[217] That's at the point where you're like, right, let's go.

[218] This is it.

[219] You can't hold it back any longer and you have those strong foundations to then build upon going forward.

[220] And to communicate to the world exactly what your direction.

[221] It's then a very crisp, very clear idea.

[222] Now, the key here is it can change over time, but you start from very strong foundations and then you have that conviction and that is very magnetic for other people to be around.

[223] The first wave of employees, the investors that you bring on board, the journalists that you chat to.

[224] So yeah, that's my philosophy, not rushing into new ideas, taking time to let them fully, fully get ready before you move.

[225] The problem entrepreneurs have in their mind, I think, and I'm thinking people listening to that, why don't they heed that really great sound advice is because they always think that there is a real urgency to the challenge they're trying to solve.

[226] They see it as they're in a 100 metre sprint and they need to go now and go fast, which means, raise tons of capital and start sprinting.

[227] Yep.

[228] And it always feels, no matter what industry, people are launching their businesses in, whether it's like someone launching cupcakes on Instagram in the pandemic because sourdough exploded, they think it's now or never.

[229] What would you say to that?

[230] Yeah, it's a really good point.

[231] It feels like that if what you're doing is surface level.

[232] If what you're responding to is just other companies, you're seeing doing well or an article you read last week and you haven't done that deep work, it does feel like urgent and you have to run because the race, the starting gun has already gone.

[233] If you do the deep work, you recognize that you can go a little bit slower because the market hasn't fully formed yet.

[234] It's almost one great analogy I think is surfing when you're waiting for that wave.

[235] You don't want to be too late, obviously, because everyone's caught the wave and away they go.

[236] And you don't want to be way, way too early while you're paddling there, you know, in the freezing cold, waiting for the sun to come up because you'll freeze to death.

[237] You need to be a little bit early where you feel a little bit of the cold and then suddenly the sun comes up and you see that big wave coming and you're ready for it and you catch it and you go.

[238] And there's nothing quite like that being one of the first players riding a wave in a new market.

[239] And it felt like that for calm and, you know, meditation and mindfulness.

[240] Alex and I were out there paddling in the freezing cold waters waiting for that wave for years.

[241] And everyone thought we were a little bit crazy.

[242] But we weren't laying the foundations.

[243] We were doing the deep work and the research.

[244] And then we were ready when that wave hit.

[245] So after Firebox, you went on to Mind Candy.

[246] Yes.

[247] Mind Candy.

[248] And Perplex City?

[249] Perplex City.

[250] Indeed.

[251] Where does that fit?

[252] Oh, wow.

[253] All right.

[254] This is going back a fair old way.

[255] The reason why I stepped away from Firebox and the idea that I couldn't stopped thinking about was around games.

[256] And I've always loved games.

[257] You know, I mentioned chess.

[258] I love Scrabble and Backgammon video games like Dungeons and Dragons, created all my own games.

[259] But I saw something really interesting happening just after the new millennium.

[260] And it was, could the internet revolutionize how we play games?

[261] Instead of games being, you know, just you and your mate playing on a Nintendo or whatever, could games be for three or four people or ten people or hundreds?

[262] What if games could played by millions of people, you know, the massively multiplayer online gaming boom that was just going going there with World of Warcraft and some of the ones coming out of the Far East.

[263] So that was what I couldn't stop thinking about.

[264] And so Perplex City was this idea.

[265] What if we could create a game that didn't just live online, it lived offline as well, that it would be all around you.

[266] It would be, you would be a hero in sort of part game, part story, part movie.

[267] I'd watched is an interesting theme here watched a movie that I couldn't stop thinking about called The Game with Michael Douglas where this person doesn't know whether it's real life or a game that they're part of and I just wanted to bring that to the world so that was the starting point of Purplex City we raised some money we buried a treasure somewhere in the world that was worth a hundred thousand pound reward for the first person where is that still there?

[268] It was found a couple of years later by the very passionate audience and community that was playing this game but we released clues we had clues in classified sections of newspapers, we had skywriting we you'd get messages on your phone it was that we had helicopters at live events I mean it was just this extraordinary experience very very expensive to do and it was called an alternate reality game and so basically that was Perplex City and it was probably one of the most creative things I've ever worked on.

[269] We had an incredible team and a very passionate audience playing it.

[270] Unfortunately, it was one of the most commercially disastrous things I've worked on.

[271] And my goodness, I learned some really valuable lessons building that.

[272] So I read that it cost up $9 million?

[273] About $9 million.

[274] Yeah, we raised roughly 10 million and we'd burnt through almost all of it, about $9 million.

[275] And I was going back to waking up in the middle of the night.

[276] This time was I was waking up in the middle of the night in a cold sweat thinking, this is not working, this is not right.

[277] And the problem was, the outside world was saying, what a brilliant idea this was.

[278] We were winning awards.

[279] We were in the press all the time.

[280] It looked like we were geniuses, but in reality, deep in my kind of pit of my stomach, I was like, oh my goodness, we are heading towards a cliff very, very fast.

[281] And I need to do something urgently.

[282] Because you hadn't figured out the underlying business model?

[283] Correct.

[284] So we had a model.

[285] So you would buy these trading cards, a bit like Pokemon cards.

[286] You'd get a random collection of six in a pack for a few pounds.

[287] And these puzzles then played into a larger puzzle.

[288] There were 256 of them to collect.

[289] There were all sorts of hidden clues within them.

[290] And we sold a fair few.

[291] We made a bit of money, but it was nowhere near enough to cover the costs of this very expensive game we were running.

[292] So the economics and the business model didn't make sense.

[293] And so, yeah, as I say, we were running out of money fast.

[294] I didn't think we'd be able to raise another round.

[295] And I was just very stressed, extremely worried about what to do.

[296] When you say, so two points want to pick up on that, when you say I was extremely stressed, give me a clear picture of what that means in real terms on a day -to -day basis.

[297] So just sitting there, I still can remember sitting at the office in Battersea, just looking at the team kind of working away.

[298] everyone happy and smiling and me staring at my screen, knowing where our bank balance was and how fast we were burning money and thinking that in a couple of months, this whole thing is going to have to shut down, will be declared bankrupt.

[299] I may never be allowed to be a director again.

[300] You know, it was quite terrifying and not almost being paralyzed and frozen with fear, not knowing what to do next.

[301] Like, how do I solve this?

[302] Who do I speak to about it?

[303] I was a sole founder in that business.

[304] So it was kind of tricky.

[305] I had an amazing C -O -O -C -F -O -C -F -O -C -E -E -E -E -V -EV -EV -EV -EV -NOLs who worked closely with me. But, yeah, I just didn't really know how to solve this conundrum we were in.

[306] And it manifested in high blood pressure, sleepless nights, not eating well, just, yeah, all the classic signs of stress and burnout.

[307] And was there a day where you had to make that tough decision to wind the company down and to bring it to an end?

[308] And how was that?

[309] What was that moment like?

[310] There was.

[311] And I kept putting it off.

[312] You know, that was a horrible thing to do.

[313] But one morning, I invited the whole team.

[314] There was about 25 of us into our conference room, sat everyone down.

[315] I was shaking like a leaf.

[316] And, you know, these people had believed me. They followed me to this company, this big vision that I'd painted for them all.

[317] And I basically just had to say, this is not working.

[318] We're running out of cash.

[319] We're going to have to stop and kill this game.

[320] And it was part way through the second season.

[321] And there were just gasps of shock and horror.

[322] And I had been thinking of a new idea.

[323] So it was very different to the current idea.

[324] And so this was what I thought was the best thing we should do.

[325] We had, as I say, less than a million dollars left.

[326] We had two options.

[327] We can continue down the path we're on and hit the brick wall and just end.

[328] Or we can pivot, do this dramatic pivot to this new idea with the cash we've got left and see if we can save the company.

[329] And we were going from this very complex, fascinating game, Perplex City to a kids game.

[330] And I tried to explain it to people and there were people shaking their heads and scratching their heads and not knowing what I was talking about.

[331] Amazingly, a couple of people got it and wanted to stay on.

[332] We had to let many people go, many self -selected out.

[333] It was also quite a stressful board meeting, telling my board that we were going to do this almighty pivot.

[334] And to be fair, and to give my board credit back then they were like, fair enough, Michael, you know, we, we, let's do it.

[335] You know, there, there isn't really another option.

[336] This, I described it as a final role of the dice.

[337] And they all got on board.

[338] And so, yeah, we kind of took a very different new direction.

[339] And we had some cards, some of the puzzles in Perplex City.

[340] We created these little characters called puzzle monsters.

[341] And the story of Perplexity was one of the many stories was that, um, uh, it was world of mystery and puzzles, parents would tell their kids if they didn't do their homework and their puzzles, the puzzle monsters would get them in the middle of the night.

[342] It's quite, quite serious thinking about it now, terrifying kids, giving them nightmares.

[343] But I just love this concept.

[344] And so we were going to create this new idea, this spinoff called puzzle monsters for kids, stealth education, help them learn, play games while being educated.

[345] And so that then, we changed the name to Moshi Monsters because it just sounded a bit more cool.

[346] and alliterative.

[347] So that was the seed of Moshi.

[348] As you look back on Public City in that journey, that strikes me as your first real, probably significant business failing to some degree where you have people's jobs and careers on the line and you have a big amount of capital on the line.

[349] What are the top line lessons where you reflect when you're on your own and you think, I'll never do that again?

[350] I'll never do that thing again.

[351] And this is the key lesson that I'm going to keep with me for the rest of my life.

[352] I think not getting sucked into and believing the hype It's wonderful to be written about in the press It's wonderful to win awards But that is not what a bit successful business is built on It can help, it can give you a little bit of momentum But you've really got to understand the fundamentals And you've really got to understand the business model And the economics, there's no point creating something extraordinary if you don't know how it's going to monetize and how you're going to create something and sell it for more than you create it for.

[353] So you don't need to be profitable from day one.

[354] You can build an audience, absolutely, but you do need to know how at some point this is going to become a successful business.

[355] And this is why I think successful businesses are so rare, because you do need founders that are creative and they can see the future and where the puck is going, but also have strong commercial instincts and sense.

[356] you know, understand margins and how to kind of build the economic machine behind their crazy idea.

[357] Such a good point.

[358] And I think I wish someone had said that to me when I started my first business wall park when I dropped out because I think I thought people clapping and me being news night and like being in the press as this 18 year old entrepreneur was validation of my business.

[359] So I got more romantic about my failing hypothesis, whereas really the clapping and the press is validation of an interesting story.

[360] There you go.

[361] Not of a business model, do you know what I mean?

[362] So, yeah.

[363] How did that turn out?

[364] Failed.

[365] There we go.

[366] We both got the scars.

[367] I mean, my body is littered with scars of failures.

[368] But the great thing about businesses, you only need to get it right once to create a huge success.

[369] I was well aware of Moshy Monsters for a variety of different reasons.

[370] Tell me about the growth and trajectory at the start of that.

[371] I heard it was very slow for the first sort of two years, 18 months.

[372] It was.

[373] You know, everyone thinks businesses that are successful just happen overnight.

[374] They don't.

[375] There's a lot of grind and hustle getting to that point.

[376] But, you know, the idea felt very strong.

[377] This, the idea of creating these little monsters that would live online that kids could adopt and look after.

[378] And I didn't know much about the kids' entertainment space, but I'd seen Tamagotchi a few years before.

[379] And I thought, wow, what a business.

[380] Tens of millions of those little beeping.

[381] characters were sold.

[382] I thought there's something here.

[383] Could we take that concept?

[384] And before that, there'd been the pet rock, which I don't know if you ever came across that.

[385] Yes, and Neopets.

[386] Neo -Pets was another great, great business.

[387] I think there's something kids, in fact, most of us love nurturing and looking after things.

[388] And so I thought in the era of Flash and the web, could we create these little monsters?

[389] And so that was the idea.

[390] We didn't really know how we were going to monetize it.

[391] And we decided to, uh, to, create these little phone charms that we would sell in shops, and you bought a phone charm for about £10, and then inside would be a code that you type into our website to adopt your monster.

[392] Disastrous idea.

[393] I think we've still got thousands of these phone charms sitting in a warehouse somewhere, and it was just too much friction.

[394] It was just too many steps, too complicated.

[395] And so after about a year of trying to make that work, we decided, do you know what, let's just make it free forget the physical product forget trying to monetize it at the start any child could come along and just adopt a monster give it a name start kind of um tickling it and feeding it and are customizing its room and instantly it was just like wow that was the trigger point took away all the friction and we were away so suddenly we went from one or two signups a day to dozens of signups a day then hundreds of signups a day then thousands.

[396] I think, you know, our peak days were over 100 ,000 children around the world were adopting a monster.

[397] It was, it was, it was breathtaking.

[398] So the business rose, right?

[399] And then obviously there was, it struggled.

[400] Yeah, because of the world changed.

[401] That's understatements.

[402] Yeah.

[403] Yeah.

[404] Okay.

[405] Tell me about that.

[406] Well, we thought we could do no wrong.

[407] We were now just the usual curve of slow growth and then rocket ship.

[408] And we thought we were going to be the next Disney.

[409] And we had opportunities to sell the business for hundreds of millions of dollars.

[410] And I was like, no, thank you.

[411] You know, we are taking this all the way to the moon.

[412] And everything was just compounding.

[413] Almost everything we did seemed to just get bigger and bigger until it suddenly didn't.

[414] And the summer of 2012 was when things just suddenly stopped.

[415] And I was like what on earth is going on.

[416] This is probably just an aberration.

[417] And we thought, oh, it's because it's a hot summer or because of X, Y, Z. You know, you kind of make excuses.

[418] But what, what had happened was that there was a shift, a platform shift taking place.

[419] And kids were moving from using the web as their primary place of kind of playing games.

[420] Desktop, right?

[421] Yeah, desktop web, playing Moshi or Club Penguin or Star doll or Neopets or all these other games to iPads and the mobile revolution.

[422] And we kind of had our head in the sand for a little bit and thought, you know, this isn't really going to take off in a huge way.

[423] And then we started to lean into it and figure out how we could adapt Moshi for this new world.

[424] But it was very, very difficult.

[425] And just the economics and the way kids would play with devices and it was much harder to create a monthly subscription service, it just started to unravel.

[426] And as fast as we'd grown, the revenue started to come down.

[427] And kids were playing all these new free games through the app store.

[428] And we, yeah, spent several years trying to kind of write the ship and keep things going, but weren't able to, sadly.

[429] So that was an incredibly stressful period as well.

[430] Another stressful period.

[431] Another.

[432] There's been quite a few.

[433] That's why I've got so many gray hairs.

[434] But again, learned a lot during that period.

[435] But that was a tough time.

[436] Tough time is in letting people go, having to scale down the business, trying to find new product market fit.

[437] Yeah.

[438] On a personal level, what was...

[439] Because, I mean, that is an even higher high to come down from, right?

[440] In terms of your identity is like intrinsically connected to this company.

[441] And I've been there where when your company falls, It's like your self -esteem is falling with it or your self -worth or your, you know, your identity is falling with it because you're intrinsically connected.

[442] Tell me about that.

[443] So true.

[444] Yeah, that was exactly it.

[445] You know, when things are going well, it's a great thing.

[446] You feel wonderful.

[447] And the tricky thing was that it was the flip that I think was so stressful.

[448] The flip from being I was sort of one of the poster boys of the boom, yeah, in short.

[449] I was on the front cover of Wired magazine.

[450] The press were just writing about us and me in glowing terms all the time.

[451] I just thought I could do no wrong.

[452] And again, the ego just got out of control.

[453] And then to have that flip to suddenly be running a business that was falling apart, we did five rounds of layoffs.

[454] So difficult for, again, the team that had followed me and joined this business having to be let go.

[455] Revenue started collapsing.

[456] Board meetings became very stressful.

[457] Press started writing negative articles.

[458] It was really, really, really tough.

[459] And as you say, you know, like you mentioned, my ego, my worth, myself was just so entwined with my business.

[460] And now the business was failing.

[461] I was a failure and worthless.

[462] And so it was a really, really difficult time.

[463] And that lasted for years.

[464] How did you cook with that?

[465] I'm lucky in that I have a very supportive family.

[466] And I have some great friends who are also entrepreneurs.

[467] and we've kind of all we've all had successes and failures and at one point some of us are doing well and some are not so we kind of pick each other up and and give each other important pep talks so I think having that community was very very helpful but you know I I wasn't when you're struggling like that again you create these vicious circles so you don't sleep very well and you wake up the next day just more tired than you were when you went to bed and you're irritable and your body is filled with cortisol and adrenaline and you don't eat well and put nutritious food in your body and you forget to exercise.

[468] So, yeah, all these negative things start compounding.

[469] I was in a pretty bad state.

[470] But to put things in perspective, again, I did try and kind of be realistic.

[471] There were people in the world going through much trickier things and their business falling apart.

[472] But when it's you and you built your whole self -worth around it, it feels like everything is falling apart and the world is ending.

[473] there's two questions I wanted to ask you which was about when you're going through those stressful moments and at a time when men in particular didn't really understand the concept of mental health did you find yourself turning to escapes or medicating yourself with some kind of escape and the secondary question was about the topic of mental health broadly when did you discover that it was a thing?

[474] So wow yeah I think when we are struggling in life We, instead of addressing the issue, we mask it, don't we?

[475] We seek things that avoid whatever the challenge is.

[476] And for some people, it's drugs.

[477] For some people, it's alcohol.

[478] For me, I just, I became distant from the business.

[479] I just couldn't face going into the office every day.

[480] I take myself off to coffee shops.

[481] I suppose caffeine is not as serious a kind of drug as some other ones.

[482] But I also used to take painkillers every morning just because I woke.

[483] up with such a headache and my body ached.

[484] I felt like I was hit by a truck every morning.

[485] So these paingillers would kind of help me get started in the day.

[486] It was a very tricky time.

[487] So not addressing the fundamental issues with the business or trying to but not doing a very good job.

[488] For me, this is what led to calm because I could see it so clearly having been through it.

[489] You know, one of the best businesses to ever set up is one where you're scratching your own niche and you understood.

[490] And I didn't know what meditation was or mindfulness.

[491] But my very dear friend, Alex Chu, had been meditating with CD -ROMs.

[492] He bought when he was a teenager, a very unusual teenager.

[493] And he would often say to me, look, dude, you need to try meditation.

[494] And I'd be like, you need to try effing off.

[495] That's the last thing I need.

[496] Look, give me something practical.

[497] But slowly, but surely, the penny started to drop.

[498] And I kind of got it.

[499] And the key breakthrough for me was when I did something I'd never done before.

[500] I took myself off on a solo holiday.

[501] I went away to the Austrian Alps to this kind of resort where I played tennis in the morning.

[502] I scribbled in my notebook.

[503] I read books.

[504] And I started to try to meditate because I'd heard about it.

[505] And it was just incredible.

[506] The fog started to clear.

[507] I'd been, had my face pushed up against the cliff and couldn't see a way out of, this problem that I was facing with my business.

[508] And just taking a step back and getting perspective was hugely valuable.

[509] And I read a bunch of books and research papers.

[510] And I realized that, you know, this is science.

[511] Mindfulness as a way of rewiring the human brain.

[512] What if we could make this simple and relatable and accessible to everyone?

[513] This could be one of the biggest opportunities and businesses in the world.

[514] And I came back.

[515] I remember chatting to Alex about it.

[516] And he's like, right, dude, you finally get it.

[517] Let's go.

[518] Because he kind of knew this And this was all around the time Where we'd been talking about creating a new business He found a person that owned calm .com, the domain And I remember we were playing video games in our house in Soho And he said, this domain calm .com is available And I said, oh my God, what a great domain What a business we could build there, helping the world become more calm.

[519] And I said, how much is the domain?

[520] And he said, it's about a million pounds.

[521] And I said, right.

[522] We don't have money to buy that.

[523] But about a year later, we're playing video games again, a consistent theme.

[524] And he said the guy that has Calm .com wants to sell it and he's willing to do a deal.

[525] We were able to buy it for much, much less.

[526] I'd earmark this money to put a deposit down on a house.

[527] But thought buying Calm .com might be a more sensible thing to do, even though my parents and thought it was the silliest idea.

[528] But yeah, so we bought Calm .com.

[529] And that was, are, that was kind of the starting acorn that was planted for that business.

[530] So here is where mine and Alex's paths kind across.

[531] So I had left my company, Walpucked, the one I described there.

[532] And this was in the transition of me starting social chain.

[533] So I knew I had this thesis about social media.

[534] I moved out to San Francisco to work at a place called Monkey Inferno.

[535] And I was helping them with growth using social media.

[536] I still had like millions and millions of followers online, maybe 10, 20, 30 million followers across multiple Facebook, Instagram, like Twitter, pages, whatever, and I was helping them scale their products using social media.

[537] And as I landed, Sean, who is the CEO there, said to me, oh, the kid just left called Alex.

[538] He said, he's gone to do this meditation app.

[539] And I swear to God, I thought, what a fucking hippie.

[540] I thought, like, what, what a weird guy.

[541] He left here to go do med, because at the time, it's different now.

[542] At the time, meditation was like, hippie, hocus, poke, nonsense.

[543] Yeah.

[544] I remember thinking it.

[545] Why did how I feel now?

[546] Do you know what?

[547] You weren't, you weren't the only person that thought that.

[548] People would back away from us at parties when we said we were building a meditation company.

[549] And it was, um, and I remember other people like thinking I'd had a nervous breakdown because of my previous business.

[550] And now I was setting up a meditation company in the day, oh, good, good luck with your non -profit, mate.

[551] With all the healing and like wearing, it had such negative connotations for something that is so valuable and transformational.

[552] It's extraordinary.

[553] As an entrepreneur, you look for those moments.

[554] And we both felt society was going to shift.

[555] We didn't think it would take as long as it did, but we felt there was change coming.

[556] That actual story about how I felt when Sean told me that and then watching what that company became, this multi -billion dollar business that everybody knows that I, everyone that I know speaks to, has taught me a very profound lesson about life, which is when you play at that kind of intersection of disbelief and belief where you're like, again, the analogy I use is the wave coming into shore.

[557] Like, you guys were really early with the surfboard and you were betting on that wave coming into shore.

[558] And every, when, so now I look for, I want to play in spaces where there's high levels of skepticism, but I feel like it's inevitable.

[559] Yep.

[560] And I always think about that conversation, that when, I always think about calm because I was a skeptic, the wave came in.

[561] And I was like wildly wrong.

[562] And I just wish I'd left with Alex.

[563] I think you've done quite all right.

[564] There's multiple, multiple routes to huge success.

[565] But that's so interesting.

[566] You said that.

[567] Yeah, I'm thinking back now to again, that time when it was so non -obvious.

[568] I remember the number of meetings we had with investors where they were like, well, this is so niche.

[569] You can get meditations for free on YouTube.

[570] And if no one is going to pay for this and mental health is something that isn't talked about.

[571] Mental health has stigma around it.

[572] How on earth are you going to build a business and get people to talk about the mental health?

[573] And we're like, no, the world is changing.

[574] This is important.

[575] What is more important than our minds?

[576] Look at all the people suffering, all the clinical depression, the anxiety, the PTSD.

[577] Surely at some point, we're going to wake up to this and the penny will flip and the light bulb will go on in society.

[578] Again, it took years, but eventually it happened.

[579] And now, thank goodness, we get it.

[580] You know, if people often say that there's an often quoted stat that one in four people will suffer from mental health issues in their life, it's not one in four, it's one in one.

[581] Anyone who has a mind has mental health, and some days it's great, and some days it's not.

[582] Anyone who has a body has physical health, and some days you can run up a mountain, and other days you can't get out of bed.

[583] And we have to understand this, and we have to respect and learn about our minds.

[584] because there is nothing more important.

[585] Solving the global mental health crisis, which is the mission of calm, I think is one of the most important challenges in the world.

[586] It's a first -order problem because if we can end all this unnecessary suffering, if people become masters of their mind, instead of controlled by their minds, everything starts to change.

[587] You know, we can start to tackle the climate change and inequality and racism and homelessness and all these other problems that stem from people having healthy minds with greater resilience and empathy and compassion and gratitude.

[588] So, yeah, it's, I get very passionate about this as Alex and the team do, but we think it's a very important mission that we're working on.

[589] I agree.

[590] Thank you.

[591] I can't think of a more important one other than maybe climate change, but, you know, survival and happiness seem like the two fundamentals.

[592] I mean, happiness is maybe not the right word, but survival and enjoying life.

[593] So like making sure we have life and then enjoying the life we do have.

[594] It feels like that must be the two sort of foundational challenges and opportunities of our time.

[595] Exactly.

[596] Helping people not just survive, but to thrive in life.

[597] And why not?

[598] And the human brain is the most complex thing in the known universe.

[599] You know, 90 billion neurons, trillions of connections between them.

[600] And yet it doesn't come with an instruction manual.

[601] We're not taught this in schools.

[602] Or we certainly weren't when we were growing up.

[603] It's starting to change, thank goodness.

[604] But we're just left to get on with life.

[605] And no wonder there's so much suffering and unhappiness and mental health issues.

[606] And it doesn't need to be that way.

[607] And I think meditation and mindfulness is, it's almost like a way of upgrading your OS, your mind.

[608] It enables you to see and the world differently and to think differently.

[609] And it's not a silver bullet, but it's an important starting point to then build upon.

[610] It's a great way to upgrade your operating system, you said.

[611] So how does that work from a neuroscience perspective?

[612] How is it upgrading my OS?

[613] What's happening?

[614] Well, so this can get quite complex, but at a sort of basic level, the amygdala.

[615] it would the amygdala is the oldest part of our brain and most people operate from there and in very very simple terms what building a meditation practice and becoming more mindful does is it changes our our reliance from the amygdala to more prefrontal cortex thinking where we're able to to plan a little bit more to think into the future to put things into perspective one way of thinking about it and a real kind of key moment for me as I developed my meditation practice was I now respond to situations in life instead of reacting and that seems like what is he talking about but when you stop and think about it is we have so much stimulation in life so many things happen and most of us react you know your first thought someone cuts you up in traffic you honk your horn your partner says something slightly passive aggressive you snap straight back at them into a big argument what if there was a slight pause, a fraction of a second, where you held and you thought and you kicked in, your awareness enabled you to respond to that stimulation rather than reacting.

[616] Another is, you know, a good analogy is going to the gym.

[617] We talked about the physical and the mental and our minds and our bodies are very interconnected.

[618] But we go to the gym and we lift weights and that resistance builds up the muscle, the strength.

[619] in our body.

[620] Meditation is like going to the mental gym.

[621] It's a way of building up the strength of your mind.

[622] It enables in everyday life to be more aware to improve our attention.

[623] And my goodness, we need that muscle of attention in this modern age because never have we been assailed with more noise and stimulation from social media to billboards to TV.

[624] It's coming at us constantly.

[625] And one of the most valuable skills in the 21st century is to be able to decide where and how and when we put our attention.

[626] That is a dying art. It is.

[627] Are you optimistic about our ability to correct course?

[628] This is a big question.

[629] I am optimistic.

[630] I'm very, very glass, half full person.

[631] And I do, despite the many, many challenges we see in the world, it feels like the world is inflamed.

[632] and in crisis if we listen to the news and we look at traditional media, I think the world is actually getting better in many, many different ways.

[633] You know, there's a wonderful book, Factfulness, which talks about the data of how the world is getting better.

[634] As I say, it doesn't always seen it.

[635] So I am optimistic, and I'm optimistic also because we're seeing this incredible shift in society where people are taking more care of their minds, that it is okay to be vulnerable and to talk about your mental health, to your partner, to your friends, to your boss.

[636] Can you believe that a few years ago?

[637] The idea of asking your boss for a mental health day off or saying, it would be a crazy, you'd probably got fired.

[638] And now, not all companies, but most companies are starting to recognize how important that is.

[639] And I think that is fantastic for society.

[640] The trajectory of calm has been just phenomenal.

[641] Was there a tipping point as such?

[642] Was there a moment where you thought, oh my god this is actually going to work and also conversely was there a moment where you thought no so when we were out there on our surfboards and it was freezing cold and everyone thought we were mad waiting for that wave to come yeah we did feel as if this this wasn't working Alex and I had some very kind of difficult stressful conversations wondering how many more years we need to wait and we couldn't we found it very difficult to raise money we were able to get some seed money in the early days but the bridge between the seed money we raised and getting to a series A took years and years.

[643] And we had no choice to make the business profitable.

[644] We had to have an incredibly lean team.

[645] There was only about six or seven of us for a long time.

[646] And we were running out of money.

[647] And I remember, I think this is around sort of 2015.

[648] We had to get very creative with how we kept the lights on in the business.

[649] And I gave a talk.

[650] And there was a lady in the audience, Venetia, from Penguin.

[651] And she emailed me afterwards and said, Oh, your story's fascinating.

[652] Could we make a book about calm?

[653] And I was like, well, it's not really core.

[654] It's not our key focus at the moment.

[655] But, okay, could we talk about an advance?

[656] And literally our cash amounts were dwindling.

[657] And she said, sure.

[658] And the money that came in from that offer kept the business going.

[659] So a very unusual way to keep the lights on at a startup.

[660] So we're very grateful to Venetia and the Penguin team.

[661] And then we had a subscription business model.

[662] So we put the price up from $10 a year to $40 a year, which was a key tipping point because we didn't see any drop off in signups, which was just amazing.

[663] So we started to make more money.

[664] We realized this service that we were offering, these meditations, were valuable for people.

[665] They were really getting something out of it.

[666] and then that was where the point was like hang on a minute we're taking off it's going it's happening that was then you shift from kind of the ice cold winter to just holding onto the rocket ship for dear life trying to stay on the surfboard exactly yeah mixing metaphors there but yeah the rocket ship surfboard was was away yeah okay and then that it presents a whole another set of challenges you've got to hire people you've got to raise more money scale up how is that for you we were we were underway there and again the business was starting it was an extraordinary place to be because we were bringing them a lot of downloads and we were generating a lot of revenue i think we got to about eight million downloads before spending any money on marketing and this is an important lesson that i that i always say to entrepreneurs don't pour gasoline on the fire until the fire is is going you know the gasoline is the marketing get to product market fit first kind of don't don't turn on those afterburners until you really understand your business and we did we knew we had something it was a way we were really really roaring and so a lady joined us called done who's just brilliant at user acquisition and she understood Facebook marketing inside out and that was the kind of the next sort of piece of the puzzle that really started to take the business to the next level and when i looked at the app store you now have the word sleep in the title as well of calm.

[667] So it started with predominantly meditation and now you've kind of branched out into sleep and I'm sure that's just another step in many steps.

[668] So sleep, why is sleep important?

[669] Where does that fit?

[670] Yeah.

[671] Well, we'd seen something interesting in the data about 11 o 'clock every night all around the world.

[672] We saw this big spike in usage and we realized that people were listening to Tamara's voice to help them fall asleep.

[673] We were like, what?

[674] Don't do that.

[675] That's not how you meditate.

[676] And, um, But we were like, well, hang on, maybe there's something here.

[677] And so that led to sleep stories.

[678] We took this age -old thing of a bedtime story, which we all love.

[679] And we kind of modernized it, and we created a sleep story.

[680] And it's a mix of a beautiful, soothing voice with sound effects, with music.

[681] And it starts in a really sort of interesting, engaging way, and then gradually becomes more soporific.

[682] So instead of your traditional three -arch structure of a story, we call it a story slope.

[683] Chris, who runs our sleep stories, kind of has pioneered this.

[684] And so before you know it, you're listening.

[685] Your brain is engaged.

[686] Instead of wondering about your to -do list or what someone said to you at work that day, you're engaged in the story.

[687] And then before you know it, we've taken you into a state where you're half awake, half asleep, that liminal mode, and then you're fast asleep.

[688] And very few people get to hear the end of a story.

[689] And this was just huge.

[690] Hundreds of millions of them have been listened to.

[691] We've had massive amounts of press.

[692] Lots of celebrities have reached out to us wanting to read them.

[693] And the final thing I'll say on this is the great thing about sleep is what a market.

[694] 7 .8 billion people go to sleep every single night of their life.

[695] Or try.

[696] Or try, exactly.

[697] So if you can create something new, if you can create a new habit around bedtime, If you can make your evening routine a little more interesting and entertaining and help solve a problem, oh my goodness, you can build something huge.

[698] And that's what sleep stories has been for calm.

[699] So that was the next massive, massive growth area.

[700] There's a lot of misconceptions around sleep and insomnia.

[701] And I've seen you talk about some of them online.

[702] What are some of the big misconceptions that you've discovered during your work with sleep and insomnia that people tend to believe about sleep that are most harmful?

[703] or least conducive with being a successful sleeper?

[704] Well, sleep has gone through a similar kind of metamorphosis in society as mindfulness has.

[705] You know, just a few years ago, it used to be a badge of honor to show off how little sleep you got.

[706] For something we spend a third of our life doing, people gave it very little thought and respect.

[707] And that shifted.

[708] You know, Matthew Walker's book, Why We Sleep, has played a huge part in that.

[709] hopefully calm has played some part of that as well so i think the biggest thing is people just recognizing how important it is everyone needs a sort of different amount of sleep depending on our genes somewhere between seven and nine hours sleep every night for me i need about eight in a quarter uh to feel good i don't know if you know your level you can probably cope on about three hours i imagine given how much you do i need to figure that out but i've i mean i've you know It was thinking about something you said earlier about how in your toughest times when Mind Candy was struggling, you started to neglect the fundamentals of being a human being.

[710] Like nutrition and water and sleep.

[711] These things have become, like, as you said, I mean, it's changing slowly now, but they became like disregarded as being important things.

[712] It's like we got further from being human beings.

[713] And it's like, I write about it in my book as well that it's so inspiring.

[714] and amazing that a lot of the cures to the ailments or the mental health ailments in our lives or the problems we encounter are just like going back to being a human being like drink water instead of coke like try not to drink too much caffeine sleep yeah talk to your friends it's like there's no like there's no like and but the problem is as well there is a culture of trying to make the solutions feel complex so I can sell you some shit whereas really they appear to be so simple.

[715] Well said, we always look for the overcomplicated solution, don't we?

[716] We think it has to be.

[717] But fundamentally, those are the basics that you just mentioned.

[718] Johan Hari talks about in his book.

[719] Lost Connections is one of my favorite books.

[720] We're disconnected from what made us human as our brains and bodies evolved over 100 ,000 plus years.

[721] And it's so basic.

[722] So sleep is one of those key things.

[723] And if we're not getting enough good sleep, if we're disrespecting it if we're drinking alcohol before we go to bed, it affects every aspect of our life and we're more irritable.

[724] We're less creative.

[725] Our memory gets shot.

[726] We just go into a negative compounding situation.

[727] And so yeah, treating sleep with respect, I think is one of the most important things we can do.

[728] Tough time, sleepless nights.

[729] Let's talk about that then this year.

[730] Difficult for everybody.

[731] For everyone's own reasons.

[732] Some people lost their jobs.

[733] Some people lost family members, some people lost their, I guess, their purpose in life generally.

[734] And a lot of people because we're all now, you know, we were pushed to live our lives through glass screens more than ever before, lost a lot of other things.

[735] And how is this, how is this last year and this tumultuous pandemic been for you?

[736] It's been a very challenging time.

[737] The pandemic, as you say, affected everybody on earth in many, many different ways.

[738] It has been extraordinarily difficult.

[739] So my perspective is more, you know, a personal perspective.

[740] But I think stepping back a little bit, if we go back to 2020, you know, when this first hit, it was all unknown.

[741] There was a lot of anxiety.

[742] But this was, we were in this together.

[743] And there was a lot of intrigue about what was going on.

[744] have to commute into the office anymore.

[745] We could work from home.

[746] Zoom was this incredible opportunity.

[747] And so 2020 for myself and the whole company, I think generally was not too bad.

[748] You know, it was it was all bearable.

[749] Twenty -twenty -one for myself personally has been pretty challenging.

[750] I think months and months and months of staring into a tiny little screen hunched over my laptop like everybody else has taken its toll.

[751] And I didn't treat my posture with respect.

[752] I didn't look after my mental health the way I should.

[753] And I started to, this started to compound.

[754] And I had quite a serious back problem.

[755] I had a herniated disc because of all the hunching.

[756] And that pushed on a nerve, which meant I couldn't walk.

[757] And I had very serious pain every day, which meant I couldn't sleep very well.

[758] I saw multiple physios.

[759] I started to take painkillers, which stopped the pain, but then filled my head with cotton wool.

[760] And so, but I still had to work and I still had to kind of communicate with my team and lead the company.

[761] And I couldn't do exercise.

[762] And so for many, many months, I was not in a great place.

[763] It was a very, very difficult summer and beyond this year.

[764] So yeah, 2021 has been tricky.

[765] I'm in a much better place now, but it has been very, very challenging.

[766] And I'm very fortunate in that, you know, I haven't lost any loved ones and it's, we've got to put things in perspective.

[767] But from a health and work angle, this is, I think, been one of the toughest, if not the toughest years that I've personally been through.

[768] So many people, as you've described there, staring at the screen every day, end up burning themselves out.

[769] What's your experience with burnout as a topic?

[770] And is that what you're describing happened this year?

[771] I think it was a combination of things.

[772] I think it was burnout, connected to chronic stress, connected to the back pain.

[773] And again, all these things start to negatively compound.

[774] The lack of exercise.

[775] I was living on my own and didn't have much kind of human connection.

[776] All these things kind of came together and created a perfect storm.

[777] And we have over 300 people at Calm Now, and the team were going through their own versions of that.

[778] It certainly wasn't just me struggling.

[779] And we do this survey every six months called Culture Amp, where the whole team kind of answers a bunch of questions, and they can leave anonymous comments with thousands of anonymous comments.

[780] And the last one we just did.

[781] And we've never seen anything like it in the data that the number of people talking about stress and burnout is way beyond.

[782] anything I've ever seen in my career.

[783] And so I think it is just now we've been in this situation for 18 months and it's just gone on and on and on.

[784] It's really affected everyone.

[785] And we're seeing this now across pretty much every company.

[786] At the start of the lockdown going back, I think what companies were seeing was a real surprise.

[787] Instead of people bunking off and taking it easy and putting their feet up and watching Netflix all day, people were working harder.

[788] We saw this at calm.

[789] And I think many companies have.

[790] I think there was a Harvard study done recently showing that the average work day has increased by almost an hour when people are working from home.

[791] So people are working harder.

[792] They can't really switch off.

[793] There's no boundary between work and non -work.

[794] And it's creating this compounding toll on the minds and bodies of everybody.

[795] So it's a crisis.

[796] It's a very, very serious issue.

[797] We are taking this very seriously at calm.

[798] Obviously, we want to support our own team.

[799] team and other companies around the world and just a few things that we've tried to do.

[800] We're still figuring this out ourselves, figuring out what the best way to work and support our teams are.

[801] So one thing is we have unlimited holiday, but teams don't take them because it's very hard to do.

[802] I've taken a few breaks during the pandemic, but I don't think I've had a single break where I wasn't on at least one Zoom call or I didn't check Slack or email at least once or twice a day.

[803] And we made the decision back in October to do a mental health week.

[804] We've done a few mental health days where everyone sort of steps away.

[805] And previously, I'd have said, what a ridiculous idea.

[806] Who on earth gives the whole company a week off?

[807] You know, we are in such a competitive space.

[808] We can't afford to do that.

[809] And we did it, and we agreed it would be the right thing to do.

[810] And I think it's one of the smartest decisions we've made in the history of the company because it gave the whole company a chance to properly step away and recharge their batteries, knowing that there wasn't any calls they were missing or any important things going on.

[811] And you know what?

[812] We came back a week later and everything was fine.

[813] The business was still there.

[814] We fortunately with a few colleagues that stayed to make sure everything stayed up and could support our audience.

[815] But yeah, that was one of the smartest things we did to support the mental health of the team.

[816] What changes have you made now in your life based on the last year, which you described as being the hardest of your life, to make sure that you are taking better care of yourself as you've, as you've alluded to.

[817] Yes.

[818] And so there were a few other reasons why it was a very hard year, sort of beyond work, which were compounding all the different challenges.

[819] I just think I've learned a lot about being a better leader by developing kind of a meditation practice and being more mindful of so many different things.

[820] One is just not getting sucked into the highs and lows of the entrepreneurial journey.

[821] You know, nothing is ever amazing or as disastrous as it seems.

[822] And I think teams want to follow calm leaders who are stable and, you know, celebrate the wins, but don't get sucked into the vortex of negativity when things go wrong.

[823] I don't go to bed anymore doing emails and waking up in the middle of the night with a phone glued to my face.

[824] I don't reach for my phone first thing in the morning anymore as something like 60 % of people do because suddenly instead of gently coming into the day and letting your mind kind of calibrate with the world, you're throwing yourself into Twitter and Instagram and the news cycle and everything else.

[825] I think that's been a really, really important thing.

[826] Four areas that I really think about that are the foundations to being healthy and looking after yourself, which then enables you to look after your friends and family and your company and employees.

[827] One is nutrition, what you put into your body.

[828] Number two is exercise, how you move your body.

[829] So important.

[830] Number three is your mind taking care of that, you know, developing a practice that works for you.

[831] And number four is sleep and making sure you get that right.

[832] Sounds very simple, but you keep those things in balance.

[833] You respect them.

[834] And again, going back to this idea of a foundation, that is a very powerful foundation to stand on, to do everything else you want to do in life.

[835] Amazing.

[836] I can't agree more.

[837] philosophy again about being a little bit more human one of the things that wasn't on that list is in like meaningful connections and one it's interesting because when I was reading through your story and if I'm being nosy here just tell me to fuck off like I'm feeling like I couldn't here we go yeah I couldn't I couldn't I couldn't I couldn't see you speak openly much about your your relationships and you're like you know that kind of thing something I talk about a lot here because I struggled a lot to form relationships over many years for lots of different reasons.

[838] Ego problems, thought the world revolved around me. Like totally selfish guy, unwilling to compromise.

[839] Flipping that question to you, how have you gone through the years of building these great companies and going through the tumultuous storms of their inevitable rise and fall and rise whilst maintaining healthy romantic relationships?

[840] Yeah, good question.

[841] I think we're similar.

[842] And I think because I've been so obsessed and focused on my business, I haven't been the best partner to my girlfriends.

[843] And they have been, you know, I look back and think of the many kind of mistakes I've made along the way.

[844] And now I haven't kind of, I haven't been mindful and thoughtful and respectful in the way.

[845] that I connect with someone on that level.

[846] So I think the last year and a half has definitely changed.

[847] Working at Calm has changed me. And I think I'm at the point now where I'm ready to finally, to settle down and get married and have a wonderful family.

[848] I have a little baby girl, a daughter, who I love dearly, the greatest thing that's ever happened in my life.

[849] And that shook me up massively as well.

[850] And I realized the world just isn't all about me. There's someone else now more important than me. And with my ex, we're trying to be great co -parents and sort of make that work.

[851] So, yeah, I've done a lot of thinking and a lot of learning over lockdown.

[852] And I think it's made me not just a better leader, but a better human being and a better person.

[853] So, yeah, very excited about what comes next on that level.

[854] Was there a moment where you realized the true value of that, of meaning, connections with another person because it took me a long time.

[855] I thought money was the only thing that mattered in life.

[856] I thought being successful and people and being like well known and all these things and having a Lamborghini.

[857] I thought that was the pathway to happiness.

[858] And at some point I've realized actually probably from learning like vicariously through people who had who like further up the path and were miserable that I maybe needed to change course.

[859] Was there a point where you And I also remember listening to the TED talk about a hundred -year study of men who were married or single.

[860] And those that were married, not only were healthier, they had less disease, they lived longer, and they reported to being happier.

[861] And then obviously I read Johan Hari's book one day.

[862] Well, I was actually in our New York office.

[863] And it was just no one was in the office.

[864] And for some reason, you know how like YouTube loops through?

[865] It stumbled on to hit one of his conversations.

[866] and I just couldn't.

[867] I was like, I couldn't work.

[868] I was transfixed on what he was saying.

[869] The penny was just dropping for me in so many ways about this like lost connections and the importance of connection and purpose.

[870] And I fucking, I sent him an email.

[871] I was like, come on my podcast.

[872] I had no listeners then, so I'm so glad he did it.

[873] But I became obsessed with that.

[874] And that's when I started saying, okay, if the North Star of Life is to be happy and fulfilled, I need to start compromising some of this like money -making selfishness, even though it feels so countering counterproductive and pursue and invest in connections and romantic connections.

[875] So true.

[876] And not, yeah, not just romantic connections, but friendship connections and family connections.

[877] And when entrepreneurs are stuck on their vision and off they go holding onto that rocket ship, you sacrifice so much.

[878] And it's not just money.

[879] I'm not driven by money that I think that's a byproduct of building something successful.

[880] To me, what kind of puts the blinkers on is just a big vision and just going, charging through walls and making it happen.

[881] But even then, you're sacrificing a lot along the way.

[882] And so being more thoughtful and a little more mindful for this next phase, I have recognized that I need to get a little more balance in my life.

[883] I need to make sure I am, when I'm in a relationship that I'm supporting and looking after and spending time with my girlfriend, that I'm spending time with my family, that I'm calling my mum every day, that I'm, you know, showing up for people, you know, when I'm playing with my daughter in the playground, not feeling that urge to check my phone, but being fully, fully present.

[884] And it's, it's not easy to do, but it's incredibly important because, yeah, I mentioned those four things that are important to building that foundation, but nothing in life matters more important than our relationships that we build throughout our life.

[885] So that has been a massive learning for me and uh yeah i'm asking this question maybe because i want the answer for myself but i i feel myself so much in your words which is knowing the right answer but struggling to do it yes when it comes down to it yeah how how oh it's such such an important question i'm still trying to figure this out my myself one of the things that developing a meditation practice has helped me do are, is improve my empathy.

[886] And I now am better at seeing the world through other people's eyes.

[887] And before that, again, very self -centered and self -centric.

[888] I couldn't do it.

[889] And I used to just assume my girlfriends thought just the way I do, that their brains were wired like mine.

[890] If I thought they had a, if I thought there was an area they needed some help on, I'd buy a self -help book for them to sharpen them up, because that's what I'd love to happen.

[891] And then I realized that, no, our brains are wired very differently.

[892] They need very different things.

[893] They need that she needs her emotions validated instead of me trying to solve the problem every time she mentions something.

[894] So I think that's made a massive, massive shift.

[895] And I think just, again, being more responsive instead of reactive.

[896] So when you can, you just hear better.

[897] The brightness is turned up on life when you develop a meditation practice.

[898] You can see these warning signs of what someone needs and then respond to them instead of just being lost in your own world.

[899] So if your girlfriend is asking you for a walk or as she is saying something to you, you not only hear what she's saying, you can understand what's behind it as well.

[900] And I think that's important.

[901] Again, not easy to do and get right all the time, but it's vital if you were to build strong, healthy relationships in life.

[902] communication, vulnerability, all kind of mixed together.

[903] I mean, great communication, I think, is whether it's with your team or with your partner is centered on being open and vulnerable about how you're feeling.

[904] What journey have you been on in terms of learning how to be a good communicator, whether it's with your girlfriend or whether it's with your team?

[905] What is the foundations of successful communication?

[906] I remember my grandmother many years ago telling me when I was jabbering away.

[907] and talking nonstop at a dinner as a young lad.

[908] She said, Michael, you have two ears and one mouth.

[909] Use them in that ratio.

[910] I was like, what are you talking about, grandma?

[911] But the penny dropped, you know, years later.

[912] And I try and listen a lot more than I talk.

[913] And I try not to do that thing that most people do is when they're talking, just not listening, just getting ready to say the next thing.

[914] And also respecting and understanding that people have different.

[915] different viewpoints and different life experiences.

[916] And there isn't ones and zeros.

[917] It isn't right and wrong.

[918] Life is not black or white.

[919] It's beautiful shades of gray and nuance.

[920] And I think we've lost that, you know, in the culture wars and the intense political environment of today and the immediate dopamine frazzled social media world that we live in.

[921] So yes, in, in, in in short, just trying to listen and understand where someone is coming from.

[922] I think a good, whenever you're in an argument with a partner, a very good technique I've learnt is instead of just back and forth, I'm right, you're wrong and getting nowhere, is pausing and stopping and saying, letting them talk, and instead of firing back and telling them why they're wrong, replaying what they've said and having them and seeing that light come on their eyes and going, oh, my God, you get it.

[923] And them doing the same for you.

[924] And you're like, wow, all right.

[925] Simple little breakthroughs like that, I think, are very effective.

[926] Isn't it so true?

[927] My girlfriend started to say something to me, which really opened my eyes to this.

[928] She said, I just want to be understood.

[929] And so I tried that as a technique, exactly what you've described, which is when she's finished giving me her upside of the events.

[930] I will repeat back to her what she said to me. Because, and I'll say, I want to be, like, super clear that I understand here, what you're saying is that, and you can see her smile.

[931] It's like, ah, because when you're in combat, it's so unclear whether the message is landing.

[932] So it ends up being this, like, broken record of, I'll try and land it again.

[933] I'll try and land it again.

[934] And it's such a pacifying, amazing thing.

[935] If you're actually trying to solve a problem versus trying to win a battle, to record, as you said, to use that tactic of sort of point recognition.

[936] Well said, Esther Perel is, is brilliant at this.

[937] she's written some amazing books on relationships and podcasts and yeah she understands the nuance of all this better than anyone so if anyone's struggling with their relationship i'd suggest uh doing some homework with esther one might think that the founders of an app like calm that has reached so many people um and that continues to scale and do so much good in the world must be the most calm humans ever they must have peaceful you know super just like i kind of imagine the being like living in Bali like long hair like just you know like a couple of like tattoos like t -shirt with their chakras pinpointed on um that's what one would assume because that's what the way people assume shit like how accurate is that for you and Alex uh not accurate and and I think that there's a little bit of that and I think we have certainly become a little more like that on this journey but um no I think one of the reasons why calm has been successful is that that that is not the brand that we have built.

[938] We've tried to help people learn this practice that is thousands of years old in a very modern way, as I mentioned earlier, made it simple, relatable, had it a bit of fun, sprinkled a bit of Hollywood stardust on top of it.

[939] You know, as Mary Poppins once wisely said, a spoonful of sugar helps the medicine go down.

[940] And so we have tried to respect the authentic roots of mindfulness, but also adapt it for the modern age.

[941] And so being calm isn't just about sitting in a lotus position, 16 hours a day on top of a mountain.

[942] It is about weaving it thoughtfully throughout your life.

[943] So you can improve your own journey through life and those of all the people around you.

[944] I think like, you know, I always conclude this podcast with like, you know, thinking of something nice to say to the guest.

[945] But in your case, you've just done a tremendous service to the world and it's so obvious what the the compliment is for you like I think of all the things I've done in my life and I'm like that this the good you've done by building that business to millions of people you'll never meet I mean fucking hell you know what I mean if if businesses are seen as vehicles for change in the world unbelievable like unbelievable imagine there's people in the do you ever like feel that that there's some young girl in the corner of India or some country a gazillion miles away that you've made and your team have made their day a little bit better.

[946] Something horrific's happened to their mistrust they've gone through.

[947] You've helped them.

[948] Do you have it like, do you know what I mean?

[949] That is just, it just feels like the most incredible thing.

[950] Oh, well, I really appreciate you saying that.

[951] Thank you.

[952] Do you feel that?

[953] I do.

[954] We do as a team.

[955] We have what we call the warm Fuzzies channel.

[956] in our Slack at work and we read one out in every big meeting of how calm has changed someone's life.

[957] And whenever we're having a really tough day and we're really stressed and this helped me this difficult year is going on the app store and reading the millions.

[958] Don't read all of them, but there are millions of five -star reviews covering all aspects of life.

[959] It's just the most incredible tonic to recognize the impact we've had.

[960] It's everything from little kids who are being bullied at school who find calm kind of supportive and helpful.

[961] for them to couples that were on the brink of divorce doing the daily calm every day and it reuniting their love to addicts giving up their drugs to people who are suicidal having their lives saved because calm and the content that we create has transformed them it's it's goosebumps inducing and we feel very lucky and grateful that we get to work on this every single day unbelievable well thank you because you've done the most most incredible service to the world we talked earlier about the two foundational challenges of our time being like saving the planet and then making sure the people on it are, you know, fulfilled, happy, whatever you know, calm.

[962] And that's exactly what you're doing.

[963] So thank you.

[964] Thank you.

[965] I'm also, as you know, a big, someone who's very interested and trying to support the mental health crisis and whatever way I can.

[966] And actually one of the joint investments we have is in a company called a Thai.

[967] I heard about psychedelics.

[968] I dabbled, sue me, you got no evidence, other than my words, I dabbled in, I did magic mushrooms for the first time, and then I was reading the data and the research online, and I was looking for companies, and I came across Compass Pathways, and then a Thai life sciences, which is using psychedelics and non -psychedelic therapies to help cure the mental health crisis.

[969] And then when I joined the company as an investor and as the creative director now, I learned that you were an investor as well.

[970] Why did you support that company?

[971] Wow, I think this could be a whole new podcast all on its own.

[972] I'll give a short answer.

[973] I think psychedelics will play an incredibly important role in solving the global mental health crisis.

[974] These compounds that have been under our nose for decades and vilified, you know, from the war on drugs back in the 60s, could.

[975] And the scientific evidence is showing that they may well be able to help hundreds of millions.

[976] of lives.

[977] So that to me ties into calm's mission and I think it's incredible work that they're doing there, not just with psilocybin, but with ketamine, with MDMA, a whole range of different substances that interact on the brain in different ways.

[978] Those compounds combined with therapy in the right set and setting, I think it is a golden key that can unlock so much positivity for humanity.

[979] So that's why I invested.

[980] And also because Christian Angamea, who's part of the company, I met him years and years ago.

[981] He came into the calm office like a tornado.

[982] And I thought, whatever he is on, I want some of that.

[983] And I was like, where do I sign?

[984] I'm in.

[985] And so yeah, very proud investor and supporter of that business.

[986] Amazing.

[987] So as I told you, there's a closing tradition we have here on the Dyer of a CEO.

[988] It's a new one, but I love it.

[989] Our previous guest, has written a question for you.

[990] What is the pain you enjoy having?

[991] Pain is horrible.

[992] No one wants it, but pain serves a very important purpose.

[993] It alerts us to a problem.

[994] And without pain sensors, we are going through life blind and it's very dangerous.

[995] So pain, whether it's mental or physical is horrible, but it's valuable.

[996] And so any type of pain, rather than just ignoring it and trying to mask it, it's important to lean in and listen to it.

[997] So I could give many, many different examples.

[998] Maybe one we've talked a little bit about today is the sleepless nights.

[999] It's the pain of waking up at 4 a .m. in the morning, in a cold sweat, staring at the ceiling, and being so unhappy and frustrated with that development, but recognizing that that pain, that mental pain, is there for a purpose.

[1000] It's my subconscious brain telling me to pay attention and to sort out a problem that I'm not addressing during my waking hours.

[1001] Brilliant.

[1002] Thank you so much, Michael.

[1003] It's been such a tremendous honour having this conversation with you, and I can speak to you for hours, but I won't.

[1004] I followed you for a good decade since Moshi Monsters and I saw your meteoric rise then and you've risen even higher and done even more goodness to the world with your with calm and along with Alex and I just want to say thank you.

[1005] Thank you for the inspiration.

[1006] You're one of the entrepreneurs that inspired me when I started out and you've you continue to inspire me to this day with your sense of purpose but also your entrepreneurial prowess.

[1007] So it's an honor to meet you.

[1008] It's an honor to have you on the show and you've been just, you know, superb.

[1009] as a guest.

[1010] Well, thank you.

[1011] And thank you to you for having these conversations.

[1012] During lockdown, I lived on the west coast of Ireland in Galway, and I would run up and down the promenade by the sea, God knows how many thousand times, and listen to your podcast multiple times through the rain and the wind and just being just so inspired and delighted by that.

[1013] And so thank you for that.

[1014] Well, you've continued to the tradition and you've added to it in a really profound way.

[1015] I really, really mean that.

[1016] Thank you so much, Michael.

[1017] Thank you.