00:38:14 · Toto Wolff
[00:38:14] S0: I have had this opportunity... Immense opportunity given to me by the board of management of Daimler back in the day led by Dietrich Zetsche, the CEO. But actually, all of the board members were very supportive of the idea. So what happened is they bought a small team, Braun, that won the championship in 2009, expecting it to be a dominant force in Formula One. And it was the first Mercedes Grand Prix Mhmm. Owned team with its own engines and its own chassis. And it underperformed. Year after year, the results were really not satisfactory. And until 2013, they won a single race only. Yeah. And I was at the time running Williams with the founder, and we also won a race. So one of the board members approached me and invited me to Stuttgart. And he said, how can it be that your private little team can win a race? And we, Mercedes Mhmm. We can't do any better than that. So I said, I don't know. So they they gave me the opportunity to look at their, you know, setup, their numbers, and everything. And I came back and said, what is your aspiration? And they said, well, winning world championships because we bought the team that did that. And I said, okay. Then one of us is wrong because I'm working on the same budgets, and I'm thinking about finishing in the top six. And they said, no. No. No. No. No. It's not the same budget. Look. We we spent a 100,000,000 more. And I said, yeah. Those 100 millions, you spent on Michaen Schumacher and Nico Rosberg. I have a paid driver from Venezuela who won the race, by the way. Pasta. That's the main difference. So they didn't like that situation at all. And so I'm just a mess... Messenger. You know? Don't... And I'm gonna go back to William. So eventually, they came back and said, we think our model, corporate running a Formula one team doesn't function. Because this... It needs to be much more entrepreneurially led. You need to empower... You need to be empowered to take decisions on the spot, and we want you to run this. And I said, I need to pinch myself because, you know, being the head of Mercedes Motorsport is probably one of the best jobs in the industry other than being Ferrari, the Ferrari guy. And and I I had to say no because I was a shareholder in Williams, and I have been always an entrepreneur. And they said, funny that you say that because we've just bought 40% of the Abu Dhabi sovereign fund.
00:40:35 · Toto Wolff, John Collison
We bought it back. You can buy that. And I said, did well in my life, but I won't be able to afford it. But they they helped you finance it. Right? Exactly. They said, how much can you afford? Yes. And I said, I'm always, you know, on the on the, let's say, conservative side. I've gone through financial hardship, and I don't wanna end up there. How much are you prepared to put into this? And I said, well, that's the amount. They said, okay. We're gonna finance... Help you finance the rest. And here I was. And until today, with the change of management now led by Ola Calenius and his colleagues, the CEO of Mercedes, they, you know, they give me a framework that I can act in the best interest of the racing team Yeah. Outside of the corporate structure. And I couldn't wish for a better co shareholder, partner, and and brand, like the brand that I'm associated with. So the decisions that we make are quick. They are in the best interest of the team whilst thinking about the consequences for the brand. Mhmm. And I run it like a 20 people organization. [00:41:38] S1: And how is... How you run it different from just hires team principals, how they run teams?
00:41:38 · John Collison, Toto Wolff
[00:41:38] S1: And how is... How you run it different from just hires team principals, how they run teams? [00:41:44] S0: Every every team is different. But for example, when you look at Ferrari, the team principal is one of 10 direct reports to the CEO. So the marketing person in the racing team is gonna be on the same level that the team principal. Then you have others other, you know, very much shareholder led organizations like Red Bull, where you would have an employed team principal that's report... Or reporting to a group of shareholders. Then you have a strictly corporate structure Mhmm. Like Audi, where you have people from the group and from Formula One are being hired to run the team. They have a salary. They might have a bonus. So that kind of long leash that I was given... Today, there's no leash because we are partners. But Yeah. They... The the ability of taking making... Of taking decisions was given to me was extraordinary because all of these people, they need to fundamentally report to someone. Yes. And there's always the risk that by... If you take a decision without having actually escalated it through the hierarchy Yes. You might be exposed and lose your job. Yes. So where I am until I really badly screw up, I'm responsible for my decisions, I'm very clear about that, but, I can't be fired.
00:42:53 · John Collison
[00:42:53] S1: Yeah. And that... And that's what's interesting. Right? I mean, you see this in Silicon Valley where companies run by founders often have different strategic degrees of freedom available to them than other companies. And so you look at, say, with Meta, you know, it's not a company that's just run by the shareholders. It's run by Mark, and he has a strong view that being on the forefront of AI is very important. And there's been kind of previous waves where he's had strong views, and now they're doing very well in the AI space where maybe a professional management team would not have had the, you know, license by shareholders or the board to spend so much money on that, and it took a long time to prove out and things like that. And you see that effect oftentimes. And, again, this is the Mercedes is kind of the only founder run
00:43:37 · Toto Wolff, John Collison
[00:43:37] S0: f one two. But it's a little bit like you and your brother, Ron Strybe. You know, you are able to take decisions that, in a dynamic environment, may prove to be false or misjudged after a few years. You know, when you look at the ability that, you know, the way Max Zuckerberg leads the company is is is quite amazing because you can decide to pour quite some investment in a certain field and then say, okay, well, that hasn't developed in the way I thought. And Dietrich Matysitz, the founder of of Red Bull, said something quite interesting to me one day. He said, as an entrepreneur, you you you need to be like a downhill ski racer. Yes. But you need to be able to stop and walk back up the hill. And I think as an entrepreneur, you can do that. And you have the long term horizon also. A manager will probably be short term incentivized. You know, you have a three or you have five year contract. Yes. You have stock options. You want to you want to maximize the value of these. [00:44:36] S1: And there's a fear of failure. There's a fear of doing something that looks bad to the people who are grading you because you're always being graded. [00:44:42] S0: Exactly. Yeah. Exactly. So that's what I meant at the beginning. You know, my time perspective has changed. It's ten years. Mhmm. And it's not it's not one year. [00:44:50] S1: Yes. People know that you're, you know, a large owner of the team. I don't think quite as many people know that Jim Radcliffe of INEOS is also, you know, a major shareholder of the the team. What's he like?
00:44:50 · John Collison, Toto Wolff
[00:44:50] S1: Yes. People know that you're, you know, a large owner of the team. I don't think quite as many people know that Jim Radcliffe of INEOS is also, you know, a major shareholder of the the team. What's he like? [00:45:03] S0: So that was a a real opportunity back in the day for Mercedes and for for Jim. And he's built an empire of an organization, you know. This is a this is a chemicals conglomerate. Mhmm. And and there are three shareholders. They run it in the way they think it's intelligent. And back in the day, Niki Lauda, unfortunately passed away. He was my my best friend. And those shares went back into the pool. And Jim Ratcliffe and De Niro started to sponsor us with quite extensively, actually. And we ended up sitting on the table with the CEO of Mercedes, Jim Ratcliffe, myself talking about the sponsorship. And it was it was when just before COVID hit. Teams had no valuations. We were all loss making. The sport wasn't anywhere near where it was today. And Jim said, I'm prepared to commit 600,000,000 as a sponsorship if [00:45:58] S1: I can [00:45:58] S0: have a stake in the team. And we said, well, that makes sense. I increased my stake a little bit, and then we were all one third. And today, Jim is a great resource that I use if I need to have a contrarian view. If someone that is highly experienced, but also shrewd in in the way he he looks at his businesses, And a very enjoyable, co shareholder that isn't really interfering. But Yeah. Because I I guess we do well enjoys enjoys the ride and is a resource that we can that we can utilize.