- Two different agendas
that operator cares about short-term results.
A startup needs to be like a baby.
Those first three years, you have to coddle and be patient.
(upbeat music building)
You got your perspective.
(crowd cheering)
I just want to be happy.
Don't you want to be happy?
- Marc Lore, the president and CEO of Walmart
US e-commerce and founder and CEO of jet.com.
And he's a serial entrepreneur.
Marc was appointed in 2016 to lead Walmart's e-comm
when his company jet.com was acquired.
In this role he accelerates Wal-Mart's e-commerce growth
and customer reach, leading walmart.com and jet.com.
Marc was named E and Y's entrepreneur of the year
and Fortune's smartest people in technology.
Welcome, Marc.
- [Gary] We're s- we're feeling solid.
First of all, you look great.
Are you racing Jerry Rice again?
I don't know why you look so handsome.
(laughing)
- No, no, you're not seeing down here.
You know the COVID 19 is for real.
- (laughing) Yeah, the COVID-19
has completely outpaced the freshmen 15
for most of my friends and family.
(Marc laughing)
Marc, thank you for being on.
Obviously we had a very long session on my podcast,
so I know a lot of people in the audience have gotten
that context, but I also know a lot of people listen
to Marketing for Now that have no clue about my podcast.
So three minutes on your entrepreneurial journey context
the, the 180 second, 242nd version
of kids selling baseball cards
to where you are now at Walmart.
- Yeah, when I, when I was four years old I-
people asked what I wanted to be, the teacher.
And I wrote this thing up that said,
"I want to be a farmer because they grow stuff
from nothing" in crayon and my mom kept it.
And that basically sums up, you know, everything.
You know, I love creating stuff from nothing.
I did every entrepreneurial business you could think
about as a kid,
mowing lawns, weeds, newspapers, recycle, wash cars.
- By the way, that's- that's
that's, that's pulling weeds in New Jersey,
not selling weed as a kid, right?
I just want to make sure everybody heard you.
- (laughing) Exactly.
- Though you're from Jersey, so anything's possible.
- [Marc] (laughing) That's true.
And then, you know, went to college
and there wasn't really the startup scene
so when I graduated college, I went to work
for a bank, you know, it's, I wish I could have worked
for a startup, but it wasn't really a thing.
And then worked in banking for about six,
seven years, was doing really well,
knew I didn't want to be in banking forever.
The startup scene was starting to heat up.
This is late nineties and decided one day to just quit
and start a company and took some risk.
And the rest is history.
I've done four startups, sold- built and sold four startups.
And the last two-
One was to Amazon was Quidsi.
It's the holding company for diapers.com, wag.com.
Sold to Amazon back in 2011, started jet.com.
Sold that to Walmart uh four years ago.
- Marc, can you give us the five seconds version
of how you got your inventory for diapers.com
which is a brand a lot of people know.
- (laughing) Yeah.
We started diapers.com.
Yeah, Proctor and Gamble to Huggies,
you know, Kimberly Clark.
Pampers and Huggies are the two main diaper brands,
could not get them direct from the manufacturer
for two years.
They would not sell us.
So the only way to get diapers was to go
to the wholesale clubs and buy them.
And so we'd go to the wholesale club,
buy them, label them, ship them out.
The problem was we lost money
on every box of diapers we sold
knowing full well that one day
if we got big enough, the manufacturer would sell us direct.
And although, I mean, they eventually did, but only
because you know, the wholesale club, I think it was BJ's.
We would clear them out of every single box of diapers.
And they got so frustrated that they called the manufacturer
and said, could you please sell these guys direct,
because they're killing me.
And that's the only reason.
And the manufacturer said at the time,
We still don't believe in your business model.
We don't believe in selling diapers online,
but we'll sell you because BJ's is an important client
of ours.
And that was the only reason.
And, you know, fast forward, you know, 10 years later
Proctor and Gamble is basically saying that they think that,
you know, why would anybody buy diapers anywhere but online?
Why would they go in a store?
And so it's a very quick turnaround, you know?
- You sell a company to Amazon, and then you come back
almost a decade later and you sell one to Walmart.
And, and my question is, how do you-
How do you bring your entrepreneurial-ism
to the table in those environments?
Right? One thing I've been impressed with-
So, you know, being a fan of your execution from afar,
we didn't know each other during this time,
but we were doing our things in Jersey,
and I'd always kind of root for you
because there's so few people who are actually operators.
You know, by the way, back to real entrepreneurs versus not,
a lot of real entrepreneurs give up
when they can't get the inventory
'cause the business plan said,
you have to buy the product that, you know,
that's what I admired.
I, so when I saw the jet.com, this me personally,
official, you know, point of view, I was like,
okay, what a brilliant-
He played the model again.
He went to the other place.
Is he really gonna be able to impact that place?
'Cause unlike the first place, the DNA's matched way more.
I'm real curious as a-
I'm a fan.
The way people watch basketball is the way I watch business.
We have Jeff, Jeff Smith coming up soon,
who's also back to that whole ecosystem,
an incredible executive at J and J.
And as he went into his entrepreneurial world,
A, I care about him as a human and was rooting for him
but also curious to see that kind of athlete who dominated
in that one game.
How's he gonna be?
Like, what's he gonna learn?
What's he gonna be good at and not good at?
I love that shit.
I was real-
I really was like, ooh, can Walmart ingest that organ?
Can that body ingest that organ?
And what's going to happen?
And will jet.com eventually become walmart.com?
Some of these stories have played out.
We've never talked about this even though in the last couple
of years we've gotten to know each other.
Talk me through being an entrepreneur operator
in such a conglomerate.
And what- Did it play out better than you thought?
Like, I'm sure you were-
the body as well.
You know, just using your common sense.
I already kind of got your quick answer.
I'm fascinated by this part,
because this usually doesn't work out.
It seemingly, I don't have the details, is working out.
Talking me through it.
- Yeah, no, it's, it's a, it's a great lesson
for big companies making acquisitions of startups.
I think, you know, when, when we sold the company to Amazon
they were like, hey, you continue to keep doing your thing
because that's what you want to do, right?
As an entrepreneur, you just want to keep doing your thing.
We'll leave you alone.
And I think a lot of big companies think
that entrepreneurs want to just keep doing their thing
and be left alone.
That's not necessarily the case.
When you have a platform as big as Amazon
or as big as Walmart,
you want to be able to impact the mothership
and really be able to help drive massive change,
much bigger than you can do on your own.
So the case of Amazon, they left us alone.
They said, keep doing your thing.
You guys will be happy, just doing your thing, right?
And we're like, no, but nothing changed.
With Walmart I had learned that lesson
and talking to Doug McMillon, the CEO at the time,
who still is, really started to, to build
you know, the, the, the core values of the relationship
from the ground up.
You know, starting with trust.
And we built a lot of trust in a very short period of time.
And I told Doug, if you really want, you know,
Jet, and me, and the team to, to help Walmart
and help, you know, drive a change,
then we would be up for that.
If you just want to buy us and leave us alone
and have us do our thing, we're not interested.
- We've done that already.
And I don't want to play that dance again.
- Exactly. And so when Doug and the board came back
and said, hey, we want to give you and your team sort
of the keys to e-commerce here at Walmart.
We, we, we think that you and the team
could really help make a big impact here.
And I think that was the key.
It was as simple as that, it was basically empowering me
and the team to go and make change.
- A little bit more of a hard ball question,
How do you feel it's going on, quote, unquote
closing the gap between amazon.com and walmart.com?
- I mean, I think it's going really well.
There's still a big gap there,
but if you look at where we were four years ago
when I joined versus
you know, where, where we are today,
I'm- I'm quite proud of the progress the team has made.
- Where, where, where have you advanced more
than you anticipated?
You're a smart dude.
I've really come to admire you.
Where have you advanced more than you thought?
And where have you fallen short more than you thought,
if I went into a time machine
and had a glass of wine with 48 months ago, Mark?
- Yeah, I mean, as an entrepreneur,
when I say, fall short, you know,
I had really big audacious goals set for ourselves
and the team when we came in.
You know, shoot for the stars
and land on the moon sort of thing.
So yeah, I mean, I think it was harder than I expected,
even though I expected it to be hard.
It's hard.
It's hard to move an aircraft carrier and change direction.
With that being said, you know, I'm surprised
at how much we've been able to innovate inside
of a big company.
You know, we, we started this thing
called Store No. 8, which is an umbrella for startups
that we built inside of Walmart.
And we've been able to build a bunch of these startups
that are wholly owned by Walmart and then infuse them back
in the business.
And I- It was a great lesson.
I'd recommend it for any big company.
You know, it's really hard to build a startup inside
of a business when, when they're being managed
by the operators of the business, because-
- Impossi- It's two different agendas
that operator cares about short-term results.
A startup needs to be like a baby.
Those first three years you have to coddle and be patient.
- Yes, exactly.
So if you can carve it out and give it capital and
and let it act like a startup.
And then in a couple of years, when it's got traction,
the business then raises their hand and says,
yeah, I would love that to be part of my business.
And you're like, okay, here you go.
You know, just take the winners.
And, and it's worked out really well.
We built some businesses.
We infused them back in the business.
I think the whole in-home delivery is, is
is a great example, delivering directly
into people's refrigerators.
I think Walmart Plus launch, I think, you know, that was a
you know, a way for Walmart to leverage their unique assets
to do something that only Walmart can do.
- [Gary] 100%. - So...
- What, what's your biggest learning from COVID?
I'm just really excited to get
into your mind for a second here.
What's your biggest "aha."
And what's your biggest reaffirmation?
Your biggest, fuck, I didn't see that.
Wow, this is cool.
And your biggest, I knew it.
I told, I just knew it and look how obvious it is now.
- Yeah, I really, early on, as soon as you know, in
in March was, was sort of fascinated with
with this pandemic and sort of built, built my own sort
of model to predict what was gonna happen.
- Oh yes.
Yes, I was getting that text.
That was wild, bro.
I thought that- I was like oh, Marc's way more math nerdy
than I think I realized.
That was cool. I forgot about-
That was a highlight for me.
I was waiting for those texts.
- [Marc] I- I started it-
I mean, that's, I am a sort of math nerd, you know,
that's how I started when I was younger
is math and stuff, that sort of stuff.
So-
- [Gary] I just thought you were rusty.
- (laughing) Yeah.
(Gary laughing)
Definitely rusty, definitely rusty.
No, but I, sometimes you know, you have to like dig deep.
I was reading all kinds of stuff as everybody else was,
and you've seen all these contradictory things.
You didn't know what to believe.
And I just felt like this was one
of those times to kind of dive deep
and kind of model and figure it out yourself.
And I think that was-
That was super helpful for just planning purposes
to kind of understand what was going to happen when
and what the risks and opportunities were there.
So I think that was a great lesson in, in just, you know
knowing when to sort of dive deep into something.
It happens in business everyday.
You're, you're-
you're in a leadership position
and you're, you're typically, you know
just staying at, at, at, you know, a mile, mile high.
And then every once in awhile you got to know
when it's time to sort of dig deep
and, and rip something apart.
And so that was a-
that was a great lesson for me in, in, in doing that.
So I had a different perspective on COVID.
I kind of had a little bit more knowledge
as to where- what was happening and where it was going.
And that, that was-
- What about the biggest affirmation?
Like what did you just, what have you seen
from consumer behavior and business that you were like, yep.
And I'm glad other people see it now, too.
I mean, certainly with e-comm.
- I mean, it pulled e-commerce probably forward...
- To the forefront. - maybe three, four years
in terms of that.
And I think it'll- that'll continue to happen,
but there's lots of new habits that people have formed
as a result.
Trends that were going to happen naturally
but were going to take a lot longer.
And I think in, in lots of industries you're seeing that
and being able to recognize, you know
those opportunities is, is key
for any successful entrepreneur thinking
about doing a new business.
Where's the puck going...
- 100%. - [Marc] As opposed
to where it's been, yeah.
- Marc, I really appreciate you.
Thanks for figuring out
the very difficult technical difficulties you had,
which allowed you to jam with us.
I really appreciate your time.
Continued success.
- Yeah. Thanks Gary.
It was a lot of fun.
See ya.
- YouTube watcher, what's up?
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