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.
00:45:58 · Toto Wolff, John Collison
[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. [00:46:34] S1: F one teams have become radically more valuable. Like, this transaction valued Mercedes as f one as, £4,600,000,000, and that's many, many, seven times increase from even just a few years ago. That phenomenon has also happened in other sports like NFL and teams like that. There's two explanations you could have for the increase in value. One is sort of a monetary theory that you have more rich people who want to buy into teams. And so the businesses are the same, but you just have more demand, to become a sports team owner and more more dollars chasing fewer assets. The other is that you can say... And, obviously, this is somehow true for f one. They've become better businesses. I mean, the audience has grown so much, and you have drive to survive and things like that. Just as you think about the increase in value in Mercedes and f one teams, how much of it is f one teams have become a more desirable asset, and how much is it that they're actually just very good businesses now?
00:46:34 · John Collison, Toto Wolff
[00:46:34] S1: F one teams have become radically more valuable. Like, this transaction valued Mercedes as f one as, £4,600,000,000, and that's many, many, seven times increase from even just a few years ago. That phenomenon has also happened in other sports like NFL and teams like that. There's two explanations you could have for the increase in value. One is sort of a monetary theory that you have more rich people who want to buy into teams. And so the businesses are the same, but you just have more demand, to become a sports team owner and more more dollars chasing fewer assets. The other is that you can say... And, obviously, this is somehow true for f one. They've become better businesses. I mean, the audience has grown so much, and you have drive to survive and things like that. Just as you think about the increase in value in Mercedes and f one teams, how much of it is f one teams have become a more desirable asset, and how much is it that they're actually just very good businesses now? [00:47:27] S0: Yeah. You know when you buy a car today, you justify it with sometimes rational decisions, like lots of horsepower or good design or it's EV because I wanna, you know, I want to have an efficient car. The truth is it's an emotional decision why you buy a car. And the emotional decision is how you want to be, how you want to be perceived. Do I want to be perceived progressive? Do I want to be perceived affluent? [00:47:56] S1: Yes.