Zibby Owens: I am very, very excited to be interviewing Stephen A. Schwarzman today who is the chairman, CEO, and cofounder of Blackstone, one of the world’s leading investment firms, and the author of What It Takes: Lessons in the Pursuit of Excellence. He is an active philanthropist with a focus on education, culture, and the arts. He’s the founder of the Schwarzman Scholars program in China. He currently lives in New York, and he’s my dad.

Welcome, Dad. Thanks for coming on “Moms Don’t Have Time to Read Books.”

Stephen Schwarzman: It’s great to be here.

Zibby: Can you please tell listeners what What It Takes is about? What inspired you to write this book?

Stephen: What It Takes is about what I’ve learned and would like to pass on to younger people, people working in organizations, people who start organizations, and people who run organizations so that they can do a better job, so they can be more successful, so that they can have fuller lives, and so the world can be a better place. That’s why I wrote it.

Zibby: Small goal.

Stephen: We have ambitious goals and a fun story. The book is a very quick read. A lot of people tell me they laugh a lot. The reason is I’ve failed at a lot of things, not all things obviously or there wouldn’t be a book. Part of the reason I wrote the book is so people learn that when things don’t go well, that’s the time that they can learn how to do better. Successes don’t teach you anything. You just do them. When something goes wrong, it’s because you missed something. You really need to confront that. If you’re working with a group of people, they need to stop and figure out, what did we do wrong? How do we fix that for the future, not on that one situation, but what have we learned?

Being successful, it requires a lifetime learning model. I wanted to show people how to do that, and simple skills like how to take an interview. How do you behave in an interview? What is the other person looking for? As well as instructing the people who are doing interviews, how do you find somebody who’s the right fit for your organization or situation? There are so many different things that are experience based where other people are doing them either for the first time, or not so well, or they’re anxious about it. It’s a little bit of a how-to. It’s disguised a bit with the story of how I went through things like that. I managed to learn and figured out how to create a culture where people are happy, and productive, and don’t leave, and are excellent at what they do.

Zibby: Dad, in the book you say that when people ask you the secret to success, your answer is, “I see a unique opportunity, and I go for it with everything I have. And I never give up.” My question is what if it’s not that good an idea? How do you know when you should let go of an idea and when you shouldn’t?

Stephen: It’s really about going forward. When should you go forward with something? How do you assess how good something is? That’s the most important thing in almost any form of human activity where you’re trying to achieve something. You have to look at every idea and say, is this unique? Is this just repeating what other people do hoping I could do it a tiny bit better? The world doesn’t much care about doing something everybody else does a tiny bit better because they’re already being served by someone else. You have to look at something that’s a bit paradigm shifting. If you’re too early, no one will adopt it. If you’re too late, other people have done it so you’re offering nothing unique. You have to be very objective about what you attempt to do. You have to not do things just because they’ll be successful. The question is how successful will they be? If you pick one, that’s what you’re doing. You’ll miss the other ones because you’re enmeshed in what you picked. In my experience, the most important thing, I call them worthy fantasies. They’re worthy of your time. They’re worthy of the effort to create them. A lot of this is produced before you do anything. Actually doing things isn’t as hard if you have a great vision of something you’re trying to do.

You’ll also be able to recruit people easier to something that is, in effect, inspirational or new rather than something that they’re almost doing before and already being well paid for it. There’s no rigid way of knowing whether you’ll be right or wrong. If you’re failing, you have to adapt. You have to change your execution. You always have to monitor whether the vision is right. If you realize that you’ve made a mistake on the vision, you’re done. You won’t achieve stuff by trying harder. I have a friend in China who started a company called Alibaba, which is one of the biggest in the world. He said he almost went bankrupt twice. He had a vision, but he didn’t really know how to get there and was inexperienced. He was an English teacher. That’s where you never give up because the vision was exactly right, but the execution was flawed. You don’t keep doing the same thing and knocking your head against a wall if you are not ever going to make that sale. You find a different way. You adapt.

Zibby: Excellent advice. I can apply that to a lot of different areas. Thank you very much. Your rule number four in the “25 Rules for Work and Life,” which you include at the end of the book is, “There is nothing more interesting to people than their own problems. Think about what others are dealing with and try to come up with ideas to help them. Almost anyone, however senior or important, is receptive to new ideas provided they are thoughtful.” Then number ten, which is sort of similar, you said, “People in a tough spot often focus on their own problems when the answer usually lies in fixing someone else’s.” Both of these have to do with listening and figuring out what motivates other people. Tell me a little more about that and how powerful it can be.

Stephen: It’s really powerful in the sense that everyone is in their own world. I remember when I was in my forties, I was at the White House for something. The president then was George H W Bush. I had met him once or twice. I spent ten minutes talking to him, which is a lot when somebody’s a president and you’re in your forties and you have no connection with what they’re really doing for their job. There was something going on in the world I had thought a lot about that I knew was one of the top things on his mind. It’s very simple. Once you start talking somebody about something that’s of interest to them where they haven’t figured out exactly what to do yet, you’ll find you can interact with anyone until you’ve presented what you have to as fast you can. Then they go, “Okay. That’s really useful. I’ve figured it out.” If they want to take the dialogue further, they will do that. Almost anyone will focus on things that are important to them if somebody else has something productive or interesting to add to their thought process.

Zibby: There were some things I was surprised to learn. I had heard a lot of stories. Now I feel I have no unique stories about you in your past, but that’s okay. I can live with that. You said you learned how to use your breathing to make your thoughts clearer in times of stress. You would focus on your breathing, slow it down, relax your shoulders, make your breaths long and deep. You said, “The effect was astonishing. My thoughts became clear. I became more objective and rational about the situation at hand, about what I needed to do to win.” Obviously, mindfulness and all this is very popular. To hear it from you, it seems very different. You don’t usually talk about all of that. Tell me a little bit about that and any other stress management tips you’ve been withholding from me. Maybe I could’ve used that. I can still use it.

Stephen: Everybody is very good at being backstage and thinking about things. Sometimes when you go out on the stage, people get nervous. They stumble. It’s that way in all walks of life. You need certain ways to make sure you’re grounded. I learned that I could figure out all kinds of stuff. In the heat of battle, if you were with people, unhappy, or have nasty faces or they raise their voices, you as a person recoil from that. You realize you’re being attacked. Then that brings adrenaline into play. When that happens, the blood is going to your musculature. It’s not going to your brain in the same amount. You have to normalize stress. If you’re in an occupation where you’re regularly in stress, you have to figure out how to not be comfortable. I’ve developed little tips. I always try and think through — actually, it happens to me when I’m sleeping — different scenarios of what’s going to happen. You accommodate to the future that hasn’t happened. Usually, there are only a few different alternatives. Then when you get involved with things, you have to make sure you’re always calm. You can let other people get excited. It’s going to be one of those scenarios, probably.

Your job is always to keep perspective, to listen to what’s going on, and then say things to change where that dialogue is going. There’s a time to interrupt somebody. There’s a time to let them play it out. If you’re enmeshed in the whole thing, you’re not going to get your timing right. I’ve learned to observe what’s going on. Sometimes, it’s a situation where people are tentative. You need to be in control of that situation. You need to take control. If there’s a really aggressive person and you try and do that, then you’ll be in conflict with them. Then you have to retreat and put their wears on the table whether they’re sensible or not. Then you play it differently. All of these dynamic situations are actually fun. You never know exactly the way they’re going to evolve. That’s what makes it interesting. You want to make sure you’re progressing whatever dialogue you have and keeping it on track. By watching and inserting yourself when it’s productive but withdrawing when things are going fine, that’s the way you do it.

Zibby: This now clarifies to me why no matter what shocking news I may have told you at any point in my life, your response is always, “Really?” You just nod and wait. It all makes sense now. Speaking of sleep, I heard at HBS or in some study or something that the one thing that differentiates really successful people from other people, when they’ve factored everything else out, is their need for sleep. People who need less sleep are more productive and successful in life. In the book it says, and of course I know, you don’t need that much sleep. You get about five hours a night. What do you think about that theory?

Stephen: I think that theory makes arithmetic sense. If you’re just as good as somebody else but you’re awake for three hours longer, you have a competitive advantage. In my case, it’s even worse because when I’m supposedly sleeping, I’m thinking about things. For me, it’s all a continuum. That does give you the ability to have more time to be doing things. It’s also when you’re asleep — I don’t think it’s time determined — you’re not under the pressure of more inputs. Your brain can process things and sort them out in a way that when you are awake, there’s so much stimuli coming in that it’s hard to take it in and reflect on exactly where you should be going strategically on something.

Zibby: This doesn’t mean that people who want to be more successful should set their alarms earlier? I’m just kidding.

Stephen: No, because everybody’s got their own circadian rhythms. You have to play the way your body tells you can do it.

Zibby: What about coming up with ideas? You’re always thinking. You’re always coming up with something new. It sounds like a lot when you’re sleeping. How do you get these ideas to percolate? Does it just happen to some people and not other people? Are there things you do to help it?

Stephen: I have certain weaknesses. I remember reading Proust and thinking, how could I be productive in a cork-lined room with no stimuli? I realized I don’t know how to think great thoughts. I need things to happen. I need input. I need information. In my business, which is called Blackstone, I set it up so I could get the maximum number of feeds, the maximum amount of information. Once you have enormous amounts of information flowing all the time, it’s easy to think about new things. It’s easy to see the relationships. It’s not a challenge. If I were left on my own on a desert island, I can assure you I would come up with nothing. I’m not even mechanical, so I probably couldn’t even get a coconut. That’s really how it works.

Zibby: On your sixtieth birthday, you reflected on parenting, which was a passage of particular interest to me. You said, “As a parent, you strive for balance between doing enough at work to succeed and being there in person for your family, emotionally available for your kids. At the time, you never know if you’re doing a good job. The reckoning comes years later. Looking back on the night of my sixtieth and the memories of those closest to me, I didn’t think I’d done too badly.” Too badly? Okay, thanks. Seriously, you have always made a point of whenever I call, taking my calls and showing me as a daughter that I’m a priority. Now I have four of my own kids. Everybody’s lost in their busy lives in some way or another. What are your strategies or tips? What have you learned? Is there anything you wish you’d done differently? What advice would you have for people who are in your spot now?

Stephen: First of all, it’s very important to let your children know that you love them. That’s unqualified love. That’s a good foundation. Not all parents do that. Secondly, you want to spend enough time with your children so they get to know you. They get to understand your values. You’re around to give them advice and help them. When I made those comments at my sixtieth birthday, the issue is were you around enough? Did you help enough? As the parent, you never know what’s going on with your child and what they’re taking in and whether you should be available more, or you should’ve said something different or you should’ve handled a situation differently. All parents, we’re parents, in effect, for the first time. We do the best we can. I’ve had two excellent outcomes. That was good. You always worry. Am I doing the right thing time-wise? I went out of my way to go to some of the sports things where it probably didn’t matter. I just wanted to be there to support my children because I love them. I wanted them to understand, even if I was on the phone trying to do some kind of transaction, which was my job, I was there. I saw what they were doing. I was supporting them. Would I have been a better parent if I wasn’t on the phone and was just looking like the other parents and cheering every time? I would cheer when they did something well. That wasn’t the issue. You never know as a parent.

Zibby: I think you did a nice job. I feel very lucky. To go back to your training a little bit, you told a story about your freshman year English teacher. I want to hear a little bit more about the writing of this book. When you got to Yale, your English teacher gave you a sixty-eight or something on a paper. When you went to talk to him, he was going to get upset with you. You said, “No, I had nothing to say. I said it badly.” He taught you how to write. What do you think your English teacher would say about this book? What grade do you think he would give you?

Stephen: He’d definitely give me an A to A+. This has the advantage of not just being me. It’s all these different people who’ve been involved. Having an editor who’s really extremely gifted, can have a sentence that you think is really good and by the time they move one word around and change the phrasing slightly, all of a sudden it sings. Writing isn’t as isolated a sport. It’s more of a team sport than I thought. It’s difficult to write. That professor saved me. I wouldn’t have made it past my first year in college. I got a sixty-eight on the first English paper, sixty-six on the second. This is a bad starting point and the wrong trend. He saved me. I ended up on Dean’s List by the end of the first year. I wasn’t stupid. This wasn’t a game I was used to playing at a level of a great university.

Zibby: Now you’ve taken education on as one of your biggest causes. You’ve benefitted so much from your education. You’re always talking about how much it has shaped you. Is that why you think you’ve pursued education as your major…?

Stephen: Yeah, because it’s really a right. It’s like health. If you don’t have a good education, particularly in an information-based society as we’re moving into it, your ability to be successful, unless you happen to have a great odd skill of being an athlete or an entertainer or something of that type, it’s going to be harder and harder. We have an obligation to make sure that everybody has the opportunity for self-actualization and the ability to have lifetime learning. To the extent we don’t provide it as a country, we will not be competitive. As individuals, we will have less than optimal outcomes. That’s a worthy thing to be focused on.

Zibby: It took you, more or less, ten years to write this book even though most of it you have dictated, which is unique. I feel like you dictate everything. You don’t write it down. It just comes out of your mouth kind of perfectly shaped. How do you do that?

Stephen: This wasn’t exactly that easy. One of my friends, Hank Paulson, told me I should keep notes because I’d forget things. As it works out, I don’t forget much. I’m lucky like that. I had a guy who was a journalist who would follow me around a bit. If I was flying someplace, he’d ask me about what happened in this year or what happened chronologically. We got that out. There were a bunch of transcripts. Then I had somebody work with me to organize that. I figured out which things should be in that. He took a draft. It was good. Writing is a peculiar thing. Unless you do the thing yourself, it won’t be your voice. It’ll be somebody else’s voice. Could be good, but it doesn’t have that authentic aspect where somebody that’s, “Yes, that is you. That’s what you think.” I had to go over this. It wasn’t quite so easy, Zib, to turn this into my voice.

I find writing — you’ve always been really good at it. I find writing incredibly painful. I like talking. I like doing videos. Writing is hard because every word has to be right. Every phrase has to be right, saying what you really think. If your objective is to expose it to really smart people and you’re not telling them what to think because you’ve got the wrong words, then they’re not, either, going to like it or you won’t be able to communicate. This was really tough. The writing part was over three years. I can’t tell you how many times I had to read this book, What It Takes. Even picking the name was months. Every aspect of this was painful. The reason I’m excited now — you can hear it in my voice. I’m done. Everyone I’ve exposed it to thinks it’s terrific. It’s inspirational. It’s an easy read. It’s funny. You don’t have to be a businessperson to like this. I’m totally pleased with that outcome.

Zibby: You should be. That’s awesome. I have to say I’m pleased because I’ve watched a lot of interviews you’ve done. Almost every time when someone asks you a question, you say, “The real question is…” and you ask another question. I’m relieved that you haven’t turned around any of my questions to ask you what the real question is. My last question, if I can get away with one more, is what advice you would have to aspiring authors out there, but also to someone who’s trying to make a mark on the world in the way that you have.

Stephen: For aspiring authors, the process is so long and painful.

Zibby: It doesn’t have to be that bad.

Stephen: You really have to have something to say. Why are you spending so much of your life doing this? What do you want to communicate to somebody else? You really ought to know that before you start. Then it’s just a question of figuring out the route to do it. As to people more starting out or restarting their lives on some level, in terms of advice, be careful about what you’re spending your time on. Know who you are. Know what you’re good at. Pick something that fits you, not something that somebody says, “You should be working at this company because it’s a good company.” I’ve found that unless you’re abnormally gifted and can do everything, which is very few people, that individuals have things that they’re much better at. It’s what they love doing. When somebody says, “That’s interesting but irrelevant. You should be doing something else,” you have to get back to where you have a passion. You have to be back to where you have a gift. Everyone isn’t the same. Time goes really fast when you’re doing something you love. Time is really endless when you’re doing something you don’t. You have to find that match between your gifts. Everybody has something that they’re good at that they love. You have to identify that and find a path to integrate that with the opportunities in the society.

Zibby: Excellent. Thanks, Dad. Thanks for coming on “Moms Don’t Have Time to Read Books.” Thanks for writing this amazing book. Thanks for being my dad.

Stephen: I love you, Zib.

Zibby: Aw, I love you too.