S9EP3. We’re built to be creative: unlocking innovation in leadership with Josh Linkner

In 2010, I started a venture capital fund where we invested in early stage tech companies. I've since started a second fund, which I oversee today. So, I oversee a $165 million portfolio of early stage tech companies and, in addition to that, I've written four books on the topic of innovation and innovative leadership. I have a great honor to speak all over the world on this subject, which is very near and dear to my heart. So, I'm a weird mix of things: jazz guitarist, entrepreneur, CEO, author, investor, and again, delighted to be on the show with you today.

One of the things that stuck out during your Annual Meeting presentation was when you talked about breaking it to fix it. I've lived some experiences where there's that “if it's not broken, we're not fixing it” type of mentality, but I also don't know that it’s natural to think that you break something to actually fix it. Could you expand on that concept and what experiences have brought you to that understanding.

What you're describing is one of five Big Principles I covered at the Annual Meeting, which is called Break It to Fix It. Most of the principles I shared are the opposite of what you might think. We've all been taught, ‘if it ain't broke, don't fix it.’ That's a common phrase, which truly is a ridiculous phrase because it's saying that you would wait until a system or a process is broken before even considering an upgrade. That's how people like Pan Am Airlines went out of business or Oldsmobile. A better approach is to proactively look at your systems, processes, go to market strategy, and ask yourself a simple question: is there a better way? Could I upgrade this? Could I make it a little bit better? And so, the notion is leaders have to be in an ongoing phase of reinvention rather than waiting for a catastrophe to strike and then deciding what to do.

I had a phrase that I would say so many times to my people that they got sick of hearing it, which is that someday a company will come along and put us out of business, it might as well be us. And I believe that's true even in mature industries like asphalt and even financial services and such. People will come along and disrupt what's the current way, and it might as well be us. So I think it's a leadership philosophy around leaning into what's new, examining systems rather than blindly complying with them. And look, if you give something a hard look and it's still perfect and optimized for the current times, don't change it just for the sake of it, but at least there was a prompt to take a look and examine it. That's where I think leaders often get caught off guard, they don't even bother to examine something until it's too late. And so the whole idea behind this is proactively really looking at every element of the business and finding a way to make it better.

People earlier on in their career often pause. Maybe they're waiting for permission or a perfect game plan to try something new. The best entrepreneurs, the best leaders, take a different approach. They start before they're ready, which means they thrust themselves in motion even if they can't see the finish line, and they're willing to adjust and bob and weave and find their way as they go. Rather than waiting for perfection before they start. So when you unpack that, that means there's urgency and initiative to take ownership of the outcomes that you crave and get going after it rather than waiting.

Could you share some of the key takeaways of your book Big Little Breakthroughs: How Small Everyday Innovations Drive Oversize Results?

Absolutely. I've written four books, and this is by far my favorite. I spent a lot of time on it, man. I spent over a thousand hours researching. I interviewed CEOs and billionaires and celebrity entrepreneurs, Grammy Award-winning musicians, and Academy Award-winning directors. I really wanted to understand how do the most innovative leaders think and act. What do they do every day? And what I found was actually really surprising. We think of history makers as those who take these giant risks all the time, like big moonshots, the best of the best. Turns out, they don't do that at all. Instead, they cultivate small daily acts of creativity, little micro innovations, but at a high frequency basis. It's not like once a decade they do something creative. It's five times a day they're trying something new, and by the way, it's way less risky. It's way more accessible.

Everybody in a company can be an innovator to a degree. And it's also a great way to build those skills. The research shows, and I'm glad you asked that question, that human creativity is a learnable skill. We are built for that. As humans, we're hardwired to be creative. That's our natural state. But most people think it's some gift that you either have or you don't. Truth is, like language or learning to play tennis, it's a skill that all of us can learn. Like a skill though, it does require a little practice and a little bit of development. You gotta build those creative muscles. But I'll suggest, especially as things become more automated and we enter this AI era, this is the most important skill for leaders today. Anything that can be automated will be automated. So what's left for the leaders as humans is to do things that AI cannot, which is compassion and creativity and ingenuity and looking at things differently.

To me, I think that the leader of tomorrow, the hard skills of the past are becoming automated. The soft skills of the past are becoming the most important skills, which again is creative problem solving and inventive thinking. And so, the book really explores that, and it provides a framework on how to develop those skills, how to apply those skills, and ultimately how to use those to create competitive advantage and drive sustainable growth.

So the truth is what we need to do is more like reconnect or tap into a dormant resource rather than learn something that's new. Now we can further develop those skills, through practice. Like anything else, you go to the gym, you build muscle mass. If you practice five minutes a day, you build creativity muscle mass. But, it's not a pursuit that requires hours of study because we already can do this. It's our natural state. The biggest thing you gotta do is remove the blockers. And the blockers are generally fear, which obviously inhibits us and an acceptance of the way the world is. Pretty easy. If you can get in a situation and any leader's listening, your primary job as a leader is to create an environment that is safe. Fear and creativity cannot coexist. If you remove the fear, creativity will blossom naturally. Just if you add sunlight to a garden, it blossoms naturally.

Really challenging people to try provoking the status quo rather than blindly complying with it. Again, the good news is it's not a hard skill to learn. In my book, Big Little Breakthroughs, I talk about all kinds of things, daily rituals and techniques and practices and such, but it's not hard to do. It costs no money. And I'll tell you, if you can unlock it, it is the game changer for people's careers and businesses, and even in our families and communities.

You're pretty open about some of the losses that you’ve experienced during your career. Can you share a time where you faced a significant challenge or failure as a leader? And how did you navigate that and what did you learn from it?

Absolutely. You're exactly right. I've had the great honor to interview some of the most successful people in the world, and they win more, but they also fail more. We don't see that. We only see the successes, but the thing is, they're willing to take responsible risks. They know that they're not gonna enjoy remarkable success and innovation unless they have a tolerance for some mistakes. So instead of looking at a setback or a mistake as an embarrassment or being ashamed of, it's more like data. I think I shared this at the conference, that instead of win or lose the best of the best think win or learn.

The problem is I already told everyone they were getting their bonus. People made deposits on vacations and stuff. So, I went to my Board of Directors and said, ‘Hey, here's what happened.’ I laid out the facts and they said, 'Sweet. We don't have to pay a bonus.' Now at that time, those bonuses added up to over a million dollars. And I was a successful little company, but I didn't have millions of dollars lying around. Like that was a big number. I explained to my Board that we had to pay it in my opinion, because, if we didn't, that million dollars would've been already spent. It will come out in apathy, someone will take a laptop, we'll have turnover, and I thought that we needed to invest in who we are.

So for the next couple weeks I was taking heavy artillery fire from my Board. It was like the Cuban Missile Crisis or something. I'm sending 'em copies of the Power of Trust. It was really difficult. But here's what ended up happening. I brought the team together. I explained exactly what happened. I told 'em that it was my fault, not anybody else's. I take full responsibility as the CEO. Nobody is to blame but me. I explained to them that we are adults, you can't get a super trophy for almost making it into the end zone, and we didn't make the number, and therefore everybody's entitled to zero bonus.

However, the only thing we prioritize more than results is trust and a belief in who we are and our values. So therefore, everybody's bonus is being paid today. Every penny in full. There wasn't a dry eye in the room. I'm getting bear hugs from grown men. And so this was a very painful lesson. First of all, I did a terrible job designing the bonus. I did a terrible job of double checking. I failed in my communication, like I made 13 mistakes. But, funny enough, it turned out to be the best million dollars I ever invested because the team was so passionate. They said, ‘He has our back. We're gonna have his.’ And so when a project was going sideways, people would volunteer to stay late.

We had no voluntary turnover for years. People would interview and come in and say, ‘I heard what you did. I wanna be part of your company.’ I never told anyone that story, and so what I learned from it, again, I made tons of mistakes there. I learned from it that doubling down on your values and your principles and who you are is crucial. Doubling down on effective communication is crucial. Owning a problem instead of passing the blame is crucial. So again, it turned out to be a wonderful investment, even though it was rather painful at the time.

As you look to the future, what trends or challenges do you think leaders will need to adapt to in the coming years? 

At a macro level, leaders are asking this question. I hear it constantly ‘What's my role in an AI era?’ And I really thought about that. It took me some time and I finally figured it out. The answer dates back to 1966 when Star Trek was launched. Star Trek, as you probably remember, the two main characters were Captain Kirk and Mr. Spock. Captain Kirk was deeply human, empathetic, sometimes lost his temper. He was passionate and he was very human-like. Mr. Spock was very analytical and detail-oriented and processing, but had no feelings. Those two worked in harmony. The show was better because of the two of them. Their results on the show were better because of the two of them. That is exactly how I think we should think about AI. We humans are Captain Kirk, we're not gonna out-Spock, Spock. We're not gonna crunch more numbers than Spock. And Spock doesn't have to be a threat. Spock is awesome. And by the way, it was Captain Kirk, not Captain Spock.

So I think we as humans, need to lead the charge with humanity and empathy and grace and meaning. All the things that computers can't do. And now we have an incredible sidekick that can crunch numbers and do mundane tasks much better than any human can which frees us up to do more meaningful work. So I think, it’s obviously gonna be an evolution, but for the most part there's a bright future for we humans here. It's not that we're gonna lose our jobs to AI, it's that we're gonna have a helpful companion to help us do the stuff we don't wanna do so we can do more meaningful work.

I work in early stage companies, I've helped over a hundred startups launch and scale. And in early stage companies, they're messy. You have some idea and you write a spreadsheet and you think 'this is it, I am gonna whisk myself off to fame and fortune.' The first half of entrepreneurship is you get hit in the face with a brick. And then when you dust yourself off, someone shivs you or shanks you with a knife. Like it's not easy. It's like a street fight. And so if all you're doing is saying ‘I’m gonna put on white gloves and I'm gonna drink tea’ - that's not what business is at all. It’s hard. And so, for me, learning to play jazz was a perfect way to learn to play business, which is constantly adapting to changing conditions and evolving as you go and finding a way through difficult problems and recovering from mistakes.

The other thing, dude, I think it's instructive from a leadership standpoint. The cool thing about jazz is the baton of leadership is passed back and forth all the time. So let's say we're all playing together and I have my name on the marquee, it's the Josh Linkner quintet or something. The only reason my name is probably on the marquee is 'cause I happened to land the gig. The next night, it'll be your name on the marquee. So, it's really more of these independent musicians and artists coming together. Here's the cool part about jazz. Again, it's not that, whoever is the leader of the session, even if they're a famous person, they trade off leadership and to me, it gives people an opportunity to lead without title. So in other words, if I'm playing a solo, I'm now the leader and everyone is supporting me. Now you're playing a solo, I'm supporting you. So, we trade back and forth and it reminds me of a great, experience I had when I was in New York City at the Village Vanguard, a very famous jazz club. And there's a lead singer, a vocalist who was the marquees name and the guitar player who I'm watching 'cause I play guitar, was a side man. So anyway, the singer calls a song. She calls the song, she calls her key and I could immediately tell she chose a key that was too high for her vocal range. She was straining. I wasn't the only one that noticed it. The guitar player noticed it so quickly and with some nonverbal cues, got the attention of the other musicians, and now he asserted himself in a leadership capacity. Everyone understood, not a word was spoken, but there's some verbal cues. He waited until after the drum solo so no one would notice a key change. He then held up three fingers, which in jazz, sign language means the key of E Flat 'cause there's three flats in the key of E Flat. Everybody made a change to the key of E Flat. Once the drum solo ended, the audience didn't notice. The singer ended with this booming finale that was perfectly fit for her vocal range. Everybody wins and the guitar player had just like this quiet knowing smile. He didn't take bow; he wasn't celebrated with confetti or anything. But I'll tell you what, who's that singer gonna hire next time?

But back to leadership, that is exactly how we need to lead these days. We don't just sit back and wait for our boss to tell us what to do. We all need to be leaders regardless of our tenure or position. And jazz is a very good metaphor for that, that we're all pitching in where we can for the greater good, to make sure that the end result is what we all crave.

How do you maintain a healthy work-life balance?

I heard a really good phrase last week from someone I deeply admire. I asked him about the word balance, and he said this, he said, ‘Balance is mathematics. What you're looking for is harmony.’ And of course that hit me in the heart 'cause I'm a musician and such. But, he said, ‘Balance is like this regimented thing and it's just counting hours or, units or whatever, but harmony is really more what you're looking for.’ And harmony ebbs and flows just like jazz does. And so there might be weeks that you crank it out at the office and miss the kids' baseball game. That's unfortunate for that week. And obviously I have four kids, so I love kids. I'm not being anti-kid, but the next week, maybe you take Tuesday afternoon off and go to the park and toss the ball around with the kid instead.

And so I think the notion is just like jazz, having some agility, being a lot less, regimented and structuring balance, but trying to say that as human beings, we have a number of priorities, our family, our health, our community, our friendship, perhaps our religion and of course our work. So it's finding ways to create harmony with those rather than just strictly balance. To me, what I try to do is list the things that are important to me by non-negotiables and mine are family, health, business, creativity and contribution. I make sure that, and every week I'm looking at my calendar saying, ‘Am I serving all of those, appropriately.’ Now, it doesn't mean equally. I'm not gonna spend as much hours in the gym as I do in front of my computer. I'm just not, that's not who I am. I'm not a professional athlete, but I gotta make sure I get in three good workouts, so at least I got something, So I think it's a matter of being intentional about the harmony that you strike across the multiple dimensions you care about the most.

If you could define your leadership journey in one sentence, what would that be? 

In one sentence, probably, a passionate pursuit of growth and contribution. For me, I have the great honor to do work that I love, that I feel is meaningful, that I think helps the world. And so, I look at my role in business as more of a calling than a function to just create money for my family. So the money has come as a byproduct, but for me, I've always chased creating new things, making an impact in lives, in other businesses ,and pushing myself, trying to find out what I'm capable of. And so it's both personal transcendence, I guess, you know, seeing what you can do, hitting your potential, but also seeing how big of a footprint you can make, how big of an impact you can make on others. How you can lift people up.

It's funny, the name of my venture capital fund is called Mudita Venture Partners, M-U-D-I-T-A. Mudita is a Sanskrit term, which means taking joy in other people's success. So, as I think back about my leadership path, it's, sure I've had some great success. I'm very grateful for that.But my biggest reward has been helping other people enjoy success. I've had moments where someone pops into my office, ‘Hey Josh, I work on the third floor. You probably don't even know my name, but, I just wanna let you know I was out this morning because I closed on a home. I'm the first person in my entire family for many generations to ever own a home. Thank you.’ And it wasn't my work, it was their work. I don't take credit for that but knowing that I played some role in helping that person achieve and thrive and reach their dreams, that's way more rewarding than some leadership accolade. And so, for me that's been the real gift is like helping other people win, enjoying a lot of mudita.