Time was running out. In the last 60 days, Howard Schultz had asked for money from everyone he had met.
Jerry Baldwin, the founder of Starbucks had approached him with an exclusive offer when he was facing money issues. Baldwin would sell the 6 store Starbucks to Schultz at 1x the annual revenue: $3.8 million. Provided that Schultz would raise the money in 90 days.
So Schultz went all out fundraising. In 60 days, he had managed to raise half.
Fundraising wasn’t new to Schultz. He had met and pitched to 242 people and raised $1.7 million to start Il Giornale coffee houses. But it was a tough task to raise the funds needed on a short deadline.
He started out by asking his existing investors. But soon he was cold calling other investors and friends of friends. On the 2 month mark however, Baldwin called him back with some bad news: he had a competitive buyer. One of his Il Giornale investors had gone behind his back. Had refused to invest with Schultz and made a $4 million offer to buy out Starbucks without due diligence.
Schultz was crushed. He felt betrayed. He didn’t know what to do. 2-3 days later, he was playing a game of basketball, and after the game, he asked his friend Scott Greenberg for advice. Greenberg was an attorney who asked Schultz to come into the office to meet his senior partner the next day who would help him out.
Schultz went in not knowing who the senior partner was. He reaches Greenberg’s office at 8am sharp. And is ushered in to meet Bill Gates Sr.
Bill Gates Sr helps Howard Schultz
Gates Sr listens attentively to Schultz. At the end of it, he asks him: are you telling me the whole truth? When Schultz answers affirmatively, he gets up and takes Schultz with him for an unscheduled meeting.
They walk across the street and ride the elevator up the building to the competitors office. Where Gates Sr enters the office without appointment and gives a severe admonishment: “you should be ashamed of yourself, that you’re gonna steal this kid’s dream. It’s not gonna happen. You and I both know this is not gonna happen.”
- In 10 minutes, he puts in the fear of lawyers in the competition. Gets them to back down.
- And then, he personally invests some of his money with Schultz.
- That’s not all, he then helps make a few phone calls and introduces his rich friends to Schultz.
“Ask for money, get advice. Ask for advice, get money twice.” – Pitbull (Armando Pérez)
Asking is important. Humbly asking opens many doors. But asking for money enters you into a transactional mode. Asking for advice on the other hand, opens up collaboration.
People will have their guards up when you ask for money. These guards come down when you acknowledge their expertise and ask them for their advice.
And it’s not only money. Any type of solicitation really. The narrative needs to shift from “can you do this for me” to “how would you do this?”
But not everyone wants to mentor you
Not everyone wants to help. But it’s not for the reasons you believe. It’s not about them not having time, or not seeing any benefit for themselves in helping.
People like helping people who they think will succeed.
If they perceive you as having high potential, they will be more helpful. So how can you show you have high potential? Attitude and achievements.
Your past achievements telegram your future potential. But at the same time, your attitude is what makes people bet on you. Your grit. Your curiosity. Your never say die attitude is what will get the world to help you.
Action Summary:
- Cultivate mentors. Acknowledge their expertise and ask for help and advice. Don’t go asking only when you need something.