YouSaid · the spoken record

Jim Clayton

lines on the record: 46
first: 2019-09-29
most recent: 2019-09-29
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Where did the time go? How did I get to the age sixty five so fast? It seems only yesterday that it sold an old car through a classified ad from that fraternity house. That was in nineteen fifty three. That endeavor led to a tiny car lot on Clinton Highway where with the help of my brother Joe, our company began in nineteen fifty six Wow, that doesn't seem like forty six years ago. I still have dreams. I dream that I'm 90 years old still playing tennis with my wife and enjoying my grandchildren and great-grandchildren. The real journey never ends. You never get there. Perhaps that's the way it should be. You see, it's not where you wind up that's so important. It's what you did along the way, the lies you touched, the work you did, the people you loved, and the dreams you live.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“owning the insurance company provides significant income for us. Shifting our mortgage company into high gear would take us to our fifth level of service or to look at it another way, our company would realize five levels of income with just one product”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Now, this is where Jim goes vertical, and this is extremely important because there's no way in hell that Warren Buffett would have bought just a company that manufactures. Mobile homes. It's because they become, well, let me just, it's remarkable how much money they start making over half their income comes from the financial aspect of the mobile home industry. So he says we began at the retail level selling homes produced by other companies. We served our customers and shareholders very well on that one level. Okay, so that's one lesson there. You can't just like it's smart. He did this incremental approach. One, can we sell? We did that good. Okay. Then with a huge step back, we began to design and manufacture from scratch the homes we wanted to sell. Then they did that well. Now they move to the third part of integration. Owning and operating mobile home communities took us to a third level. Now we're providing our customers with quality sites for their homes in an attractive lifestyle for their families.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“We had to knock out the wall, which didn't please our landlord, then spent two days and hundreds of dollars building a larger door. Over the years, we've had a lot of laughs about this, but at the time it wasn't funny at all. The homes we made were simple, cheap, and sold even before they were off the assembly line. Our retail price was $3,995, a little lower than the rest of the industry. Our customers saved significantly on freight costs. The hundred dollars, oh, this is another benefit of the trial and error process. Their factory or whatever you want to call this, I guess their factory was local. So it says, our customer saves significantly on freight costs the hundreds of dollars normally paid to move the homes from the factory to the dealership. Instead, this was credited to our customers since we were building the homes locally, just blocks away from the sales center. And there were no freight-to-dealer costs.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“So now Jim moves into a point he's like, I'm gonna, there's nobody else that's completely vertically integrated in the mobile home industry. I'm gonna make the first of that move. So he's gonna go from retailer to full-fledged manufacturer, right? And this is, again, what I mean about, okay, well, you know, other people figure out how to build and manufacture mobile homes. Like I can learn how to do that too. And it's a slow process. I don't want you to represent this. It took six years for the manufacturing division of Clayton Homes to be profitable. Once that happened, then he can move into other areas and we'll get there. So it says it's just a funny story I want to share with you. The factory is only big enough to construct three mobile homes at the same time. Everything starts small. We quickly created a crewed assembly line and adopted unintentionally the trial and error approach. One early lesson learned. Always make sure the size of the finished product is smaller than the doorway. The first home we made was 12 feet wide, but the door was 11 feet and 10 inches.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Said with a sly half smile. Okay, you run cars and I run homes. So there's actually two important things here. One is the benefit of having a good relationship with your business partner. At this point, it's his brother. They've never had a fight in their lives. They just handled things very easily and simple. Even the breaking up of the two businesses was handled in like one-page contract. And two, it's not at all clear that without the success of the car dealerships that Clayton Homes would have ever been as successful because he was able to dedicate several years to working on the home business while also reaping the benefits of a successful car dealership. In fact, that car dealership, I think it's still family owned. I think they've been in the family for like 50 years. And Jim says that. He says, make no mistake. All 8,000 of us who get our paychecks from Clayton home should never forget that our organization wouldn't exist if not for the dealerships run by Joe and later by his children. It was during this period that both now I'm getting into some of the unique reasons for the success he was having. It was during this period that both our car and home divisions began a dramatic”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“All right, so from there, he starts buying more. Then he visits dealers, and he just now he has a full fledged mobile home business, right? And at this point, he's not vertically integrated. We're going to get there. Right now, he's just reselling other homes that are manufactured by other businesses. But the problem was he's spending so much time. He's still got a car dealership. Actually, they have more than one at this time. So this is what allowed Jim to focus solely on homes. And it was a unique reason. And then I'm going to talk more about some unique reasons for his success. He says, by early 1968, I was spending zero time supporting Joe at the car dealership. Clayton Holmes was eating my clock and I have to admit I was loving it. In June, Joe and I stopped for a beer after work and held the big meeting to formulize the role that we had both been playing very capably. The conversation lasted almost a full five minutes. Mr. President, it looks like you're running cars, I said to Joe. Sure looks that way.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“We spent two days and another $800 to redo the kitchen, repaint the ceiling, and replace the carpet. Remember, this is happening right by his auto dealership. There's tons of people that drive on this road, and he put an ad out saying for sale. Someone's driving by saw our first sale sign and stopped. They bought the home for $4,500. Profit after delivery was $2,000. Not bad. I was onto something.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Has this idea, he's like, well, let me just baby steps. Every big company starts out a small company. Every great company starts out as a small company. And so he does the exact same thing that he did when he was starting to sell cars. He just tries to sell one. Just one. I don't need to scale. I don't need to worry about selling thousands or whatever the case is. I'm going to see if I can sell one. So he scans the classifies. He says, well, scanning the classify. It's an ad for a used mobile home caught my eye. It was 10 by 56 like new. The ad went on to say state that it had a small kitchen fire. I began to wonder if this little burnt out home could be fixed up. If so, maybe we could sell it for a little profit. And if it worked, who knows? Maybe we could make a few hundred dollars in the mobile home business. Who would have thought that that little burnt out mobile home would take us to number one in the market share in several years? I bought it for $1,200 and I called on the troops. Mom and dad. The three of us started to work on the damaged but repairable home.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Now, I want to refer you back to his experience living in a mobile home. Like, oh, that's interesting. Now, I'm going to flash forward about a decade from that time period, right? Him and his brother are making tons of money with their car dealerships. Everything seems to be fine. And this is how a daily traffic jam caused Jim to stumble into the mobile home business. So there's a mobile home reseller across the highway that their auto dealership is on. And it's these guys called the tailors. I think they're brothers too. And he says, they were delivering so many mobile homes that they caused a traffic snarl on Clinton Highway almost every morning with their deliveries. And then this is Jim's inner monologue. He says, this happens every day, darn guys. And I hear they make a couple thousand bucks every time they sell one. 10 times when we make, when we sell a car, every time I see one of those big things pass me on the road, they've made a couple grand. And I see it every day. That mobile home business must be really good. So how does you get started in mobile?”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“We were not prone to spending sprees, preferring to keep the purse strings tight. To sum it up, if a considered expenditure didn't support the business, we'd be taking a long, hard look before approval. Cash was king as it is now. And again, you can see, you can just picture Warren reading those words and nodding along. And I'm like, I'm going to buy this guy's business.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“In the fall of 1961, I went back to the University of Tennessee, this time, to law school. That's just amazing. He learned his lesson. Now he understands, like he reads and actually drafts a lot of the contracts that he gets into. And they wind up controlling the cost and not over leveraging themselves. So he says, just two years after the bankruptcy, this is the new dealership, our cash flow credit and credibility were again satisfactory. But now, in fact, we operated with all bills paid, current, no exceptions. Now they were making enough money. They said, we could have bought big houses and luxury cars or became jet setters with frequent jaunts to Europe or Hawaii, but we didn't. Our lifestyles were so modest that it wouldn't even drive a clean car off the lot for the drive home from work. I wanted the clean cars on display and available for our customers. So I drive the latest dirty trade-in, even when that was a little beat up.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Understand the power that the bank had. He says, certainly I was getting a lesson in what can happen to a small business if the owner does not have adequate legal experience. And I swear that I would never be in that situation again. The bankruptcy fiasco made it clear that there was some huge gaps in my knowledge. I wanted to learn the law.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“We presold a lot of those cars and paid for them with the buyer's own money. Think about it. We knew the condition of the cars that the bank Those reasonable profits added up. Now, in addition to that, the third thing he does, I would say is uncommon and also smart. He gets a job while doing this. I went back to radio. And the host of yet another Saturday morning program. The base pay was $125 a week plus commissions on any advertising I sold. The Saturday show gave me a chance to promote the business, good publicity for a change, and the salary was enough to allow me to forgo taking any salary out of the new business. And so I think that story just illustrates Jim's like modus operandi in life. He's like, okay, I have a problem. Let me think rationally and non-emotionally how to solve that problem and just go and do that. He also applies it to, I referenced earlier. If there's something I don't know, that's fine. I'll go learn it. And so what is the lesson, the unique lesson he took from being bankrupted because he didn't.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Unique, interesting thing that you do. So it says talks about the bankers were there. They were there at the first of three bank auctions featuring some very familiar merchandise. Representatives from there. Sorry. Representatives from the bank were there too. Obviously displeased and speculating as to what sinister scheme might be afoot. As we won bid after bid, you could practically see jaws drop as they watched us, those poor, bankrupted souls buy back our own inventory at bargain prices. By selectively bidding at the three auctions, we brought about fifty cars and were amazed at some of the prices. The average price paid for the cars was a little over $800. Now, so they brought some money, but not enough. He says, now you may be asking after performing some quick arithmetic just how we could buy 50 cars plus parts, tools, and supplies with a relatively small amount of cash. Here's a second really smart thing they do. Simple.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“There's going to be two things that Jim does here is remarkable and very abnormal. One, the next day he gets up, he's like, all right, we just got to start another dealership. They have a bankruptcy attorney. He's like, well, you know, that company's bankrupt, but you guys aren't personally bankrupt, so you could start another company. And that's what they do. So this is section I'm going to talk to you about. It's tactics used to start another smaller dealership while in bankruptcy, right? They do something really, really smart here. They're like, okay, and they do it and make sure it's legal first. They check with their attorney. The bank confiscates all their assets, right? Well, what do the banks do when they do that? They don't keep them. They auction them off. So Jim and his brother, they have to hustle. They have to sell, like they borrow somebody from friends and family. They had some cars that were in their personal names they were able to sell because only their car dealership was bankrupt, not them. So they go to these auctions and they buy back their old inventory for more than 50% off. And then that's not only the one you”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“For Clayton, that's the name of his company at the time, a great year. The coming year would be a blowout for sure, we thought. But by the spring of 1961, a rumor that Tom's department, there was a rumor that Tom's department had been audited. The audit turned up irregularities. Something about high delinquency and a poor loan documentation. So he comes back from this trip and his brother picks him up from the airport. He's over in Sweden or wherever Volvo's at. And they give him awards for selling so many Volvos. He feels like he's on top of the world, comes back that day not Tom, Joe is his brother, picks him up and it looks like somebody died. And why? The bank is demanding immediate payment of all principal and interest, all $275,000 of it today. It wasn't possible. It didn't make sense. We weren't behind on any payments to the bank. We never had been. So they wind up going to a meeting.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Okay, so I'm fast forwarding in the story. Just know that his dealership is a massive success at this point. He's selling for all different kinds of brands. Him and his brother making a ton of money, and it's all going to blow up. And so he's learning the danger of leverage. And the messed up part was it wasn't even really his mistake. He winds up switching his business because obviously, you know, customers come in, they need to finance. Cars are a large purchase for most people. And so he switches to a younger banker, and that banker is trying to make a lot of money, and they do so by essentially like cooking the books and giving people credit that shouldn't have got credit. And this is happening in the 60s. And we know that that continues happening today and will always happen. It's just part of human nature. Now, here's the problem, though. That bank wasn't only doing it for Jim's dealership. They were doing it for all kind of other businesses. So eventually they realized, oh, shit.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“The curiosity. Unwittingly, the Snyders became excellent promoters for us. The more they ran those ads, the more beetles we sold. A top flight New York ad agency with a blank check couldn't have gotten us more publicity. It is never smart to shine a light on your competitor, not even a candle light.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Faster than they otherwise could. Now, what happened is the Snyders make a huge mistake here. They start running and spending all this advertising money warning the public to beware of gray market Volkswagens. But it's the same product. So what happens is Jim winds up benefiting from his competitor's ad spend. So the competitor made a mistake. The competitor, the snider, should have focused on being better to their customers instead of looking at their competition. Publicly, they retaliated in the new Sentinel. That's the newspaper in the area they're in, with enormous ads and a headline that bellowed, beware of gray market Volkswagens. What followed was a litany of warnings indicating the mishaps that would befall the buyer foolish enough to purchase a beetle from the evil conniving gray marketer. This was free advertising for us. Readers couldn't help but wonder what the heck a gray market Volkswagen was. They check us out just to satisfy”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Customer. So I think that's just ridiculous. And then what happened is Volkswagen selling these gray market, even though they're the same new Volkswagen Beatles, but they're selling them to other dealerships, which is a weird business practice itself. And so the Snyders are really, really mad at Jim and his brother. So it says, so now instead of going to Snyder's, you can go to Jim and you wouldn't have to wait. He says, but unlike the Snyders, we didn't make our customers wait. In fact, our customers could buy a Volkswagen and dry it off the lot that very day. For that, they'd gladly pay the extra $300. So he's actually selling him for $300 more than the Snyders are. And he's selling.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Nature that people will buy products from people they like. After appearing night after night in their living rooms, even from inside an electric box, people felt like they knew me. I mean really knew me. Like I had a personal relationship with them. They'd walk into the dealership and say, where's Jim? I was like an old friend. Because of TV, they trusted me. And if you're selling something, that's as good as good as it gets. I can't begin to overstate how much credibility those television commercials gave us. And this whole idea about the value of business can have is if your customers trust you. And that's, again, something straight out of Buffett and the School of Buffett and Munger. They talk about, I don't care if you lose money. I care if you damage your business's reputation because that's way more valuable. And they tell that to all the CEOs that they manage. Jim also picks up on something that, again, is something that could have easily come out of the mouth.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“And so he's really into music. He's a musician. He does like this talent show. And he puts it on, and this is a lesson he learned from earlier because he would sell advertising for other shows. He's like, well, I don't need to sell advertising. My auto dealership would be the advertiser. I just need to build to make the show. And so he appears on camera and he's sings country songs and he does, what are they called? Jingles for his just goofy little jingles. And it works. He said it caught on. People kidded me about being the singing car salesman. It was fun and more successful than the radio spots, how he previously advertised his business. Once again, I learned the power of thinking outside the box. Sure, it's easy to copy the competition, but doing business like everyone else means you'll get results like everyone else, which is usually average. For me, that's completely unacceptable. After appearing night and then he picks up something about human...”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Joe and six other fraternity brothers. They became my first sales team. This cookie cutter approach to the car business worked better than I could have ever imagined. Some of these guys sold a car every week. It wasn't long before our gross profit was $6,000 a month. My net was about $2,000, good money for almost anyone then. But especially for a kid in his early 20s. So his business is growing. Now here's the issue, right? So this section really explains us the benefit of the power of thinking outside the box. He's in a commoditized industry. He's selling used cars. So he's got to figure out how can my business stand out. And at the time, TV stations are relatively new and they had not all hours of the day had programming. So you could buy programming if you'd produced your own show. So you buy it from the buy the time from the network essentially.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“So now I'm going to get to the point before I read this book, I thought the entire book was going to be about that mobile home business, right? That's not, he stumbles on the business by accident later, and I'll get into that. His first business, he stumbles on that too by accident. He's still in college and he's a hustler. working weekends, off hours. He doesn't have a lot of money, so he's got tons of motivation. He's got two jobs and going to college, right? This guy's not sitting around loafing. He says, I spent most of my weekends on off hours for my other two jobs in this manner. Oh, so let me before I jump ahead. So he winds up just like buying used cars because the lesson he learned from his dad was earlier. But then he starts reselling them by accident. He's like, wait a minute. I just made more from reselling this one car than I did for my two jobs. Maybe I'm stumbling onto something. So this is how he starts car dealership. So he says, in a few weeks, I was making more money on a good week selling cars than I was at my other two jobs combined. Soon I was thinking, wouldn't it be great if I could sell more than one car at a time?”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Is the mobile home company he eventually found is making $100 million a year after tax by the time, and it was profitable for 28 plus years in a row by the time Warren Buffett buys the business. I just think the idea of having a company where you're making $100 million a year in profit after tax is nothing short of amazing.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“To. He didn't even know anything about him. But because renting an apartment was so expensive, so through this experience, he learned some of the benefits of mobile homes, of living in mobile homes. So he has to move cities. Now he's going back to University of Tennessee. And he says it was difficult leaving that great job, the charming city, but the process of moving itself wasn't difficult at all. We didn't have to move furniture or pack anything in boxes. Canned goods stayed in the cabinets. Clothes stayed in the closet. Socks and shorts stayed in the drawers. Silverware stayed in its compartment. All it took was a little masking tape to make sure doors and drawers stayed shut, and we were done. So they come, they hire a company, they lift the mobile home, put it on a truck, and move it to Tennessee. Done. And he says that they moved it in a day. And by that night, we were cooking in the house. Now, this is fascinating because something else that it's not mentioned in, I don't think I mentioned it later on in the podcast. Let me just tell you, hey,”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, let's do it. They throw in money. Everybody's excited. Guess what happens? The other guys were revved up at first. Later, they learned just how much work was required to obtain a pilot's license and didn't want to put in the time. Except for Joe, that's his brother, none of them became pilots, and only two of them ever took lessons. So they still paid for the plane, but they were lazy, they were unwilling to do the work. Let me pull up my notes on this talk. This guy named Josh Wolfe gave, who's an investor and an entrepreneur advocate. And there's something he said that I wrote down and put in my collection notes that I think about constantly. And I think I've talked about it a few times on the podcast, actually. So he talks about like, what are the opportunities that his company is looking for? And he says, we want really high scientific and technical complexity. Not because we want to tackle things that are really hard. It's because we don't want competition. The problem with funding and doing easy things is you get hundreds.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Around this time, Jim becomes fascinated with flying. And it's really funny because you could buy at this time, you could buy a plane. It was like, you know, like a 65 horsepower little two-seater for about $895. Well, gyms in college. He doesn't have $895. He comes with this really good idea. He essentially invents fractional plane ownership before a few decades before it actually becomes invented by another Buffett company that Buffett winds up buying. I think it's NetJet. It might be called like Marquis Jet or something like that now. But anyways, the lesson I'm about to tell you is he goes in, he convinces a bunch of his other fraternity brothers, hey, I think there's like eight of them or something like that. And they said, hey, let's all chip in $120 and buy this plane. And then we'll all learn how to be pilots and get certified as pilots. Now, that's the story. That's not the lesson. The lesson is there's a strategy here that you should do the work others won't do, right? Everybody's like.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Go to UT so credits would transfer, and you could work at the same time so you wouldn't have any debt. Those three things set Jim up to be able to move into business later on, which is going to happen relatively soon. But it's not at all clear, and Jim doesn't know this, if he would have naturally gone into that. He thinks he had some entrepreneurship tendencies at a young age, but he was so interested in radio and television. He thought maybe him and his brother would just work in the industry for the rest of their life. So that to me is like a story of the difference a mentor could make. And if you don't have a mentor that you can interact on a personal basis, please do try to find them through podcasts and books because...”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Budding technology of their day eventually turns into TV stations too. Bill also pushed me to get my first class radio license required by the FCC to operate and maintain transmitters at commercial television and high-powered radio stations. This in particular was a superb idea as TV was sweeping the country, absorbing engineering talent. So he winds up studying, he's not telling anybody but Bill this, right? So he winds up passing the exam from the FCC. And so he gets his license. He says, this I thought would be my meal ticket about the same time the University of Tennessee accepted my application. I packed the Chevy, left Memphis, and moved 400 miles to Knoxville on my first day there armored a fresh first-class license. I got a job as a transmitter operator for WNOX, a 10,000-watt radio station. So now I just look at my notes, the difference a mentor could make. Encouraged him to go to college to study engineering, advised him to get a license to the SEC to operate radio TV stations.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“But to learn everything. I think that's a good model for all of us. Okay, so now I'm jumping ahead. He realized, hey, his dad even said when he was younger, he's like, oh, I'm going to see that other plot of land for you. I'm going to saving that for you. Reminded me Henry Ford's early life, where his part of the reason Henry Ford was so obsessed with all things mechanical is because he didn't want to be a farmer. And same situation for Jim. Jim's like, dad, that's not like my goal is not in life not to be a sharecropper. Like, I don't want to be a dirt farmer. So he winds up moving away. He has no idea, he graduated high school, but his parents never mentioned college to him. They even thought most farmers in the area was at was thought high school was a waste of time because it took away from hours where you could be working on the farm, right? This section where I'm at right now, it's going to talk about the difference a mentor could make in your life, right? And Jim's mentor, when he's teen.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Not only does he learn how radio signals are transmitted, he's able to take apart and rebuild radios. And so while he's doing this, and he's, I think, 16 at this time, he just has this like throwaway quote that I think applies to so much, it applies to the relentlessly resourceful nature that entrepreneurs and anybody that wants to get good at their craft. It's not exclusively the domain of entrepreneurs has to wrestle with. And he says, shoestring operations offer tremendous opportunity. You have no choice but to learn everything. So he's talking about radio right now, which leads him to have jobs later on, but that is applied to everything. I think if you just go through life and says, I have no choice but to learn everything. And I'm not saying it's impossible to learn everything about our complex world, but everything that you need to learn to do whatever it is that you want to do in life. Again, you have no...”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“To entice us to sell, there were rewards. The seed company gave us a choice between prizes or free products. He does something extremely smart here and extremely rare for a young child. He says, I weighed my options carefully. Did I want a toy car, which would be instant gratification? Are free seeds deferred compensation? And essentially they're going to give you the product for free. This decision was more consequential than I ever knew. Without realizing it, I was setting the tone and shaping a philosophy that would characterize the rest of my life. I chose the seeds. It was my first attempt to become an entrepreneur. Ploughing the money back into my business was a smart move. I got to keep all the proceeds from those extra seeds so it really increased my cash flow. But I learned something far more profitable. Forgo those things that give you momentary satisfaction.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“So now in the story, Jim's about 10 years old. He understands that he doesn't have a lot of money. He's doing anything he possibly can. He'll help out his uncle's store. He'll work on other farms. He'll collect bottles. He could do anything. And as a result of these activities, there's a lot of early valuable lessons on entrepreneurship that he applies later on to his many businesses. So he says, in whatever spare time I could find, I sold flower seeds door to door. So he talks about now some of the incentives. We've talked a lot about incentives the past few weeks. If you listen to my podcasts on Warren Buffett and Charlie Munger and how important it is to them and how they're constantly preaching the value of understanding the incentives that not only do you give employees in your business, but that you see in all areas of life, that it's, I think they say, like the number one shaper of human behavior. So in this case, the flower seed company that he's selling seeds for are also trying to organize and incentivize their sales force, right? It says.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Considering his nickname was the Tennessee plowboy. That's what they called the position that Jim had on the farm, plowboys. Eventually, Eddie would have 28 number one singles. He'd be the first country entertainer to host a primetime network TV show. Ultimately, he'd sell 90 million records. He was one of us. Still in touch with his roots, confirming that any of us can find a way out of the cotton patch. His growing success was an inspiration to me as I shaped and nurtured my dream.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Okay, now I'm skipping ahead. He's still a boy. In this section, I think what I took away from this section is there's a huge value in having examples that inspire you. And when Jim started out his life as a young boy, he wanted to be like an opera singer, like a country music, like guitar singer person, a musician, singer person. And he looked up to this local guy named Eddie Arnold, who winds up being one of the most successful country music artists or musicians in history. So he says all of us felt a kinship to Eddie because he was a hometown boy. He grew up near us. Eddie started out with nothing, no contacts and no hand up. In fact, he started out just like me. A kid on a cotton farm who undoubtedly had a dream as he learned to sing and play the guitar. We appreciated that Eddie never tried to bury his dirt-poor heritage. In fact, he gloried.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“It is possible to survive even prevail. As a boy I can never articulate these things. As a man I was able to look back and apply these hard-won childhood lessons to my business and my life. And I just think that's the most important part, understanding that you can manipulate life. You can change it. You can poke it. You can have an effect on the outcome of not only your own life, but all those around you. I think that's extremely important for people not to just wallow. You might not be in a good situation today, but you can make the necessary adjustments and improve your situation in the future.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“And I referenced this earlier, but I do think the section I'm about to read to is probably the most important point in the book because it can be applied to so many different things. He says it probably sounds like we lived under harsh, under extraordinarily harsh circumstances. But even in that time and in that place, I learned that certain concepts are ageless no matter what century we're in. Self-discipline, willpower, perseverance realizing that disappointment is not defeat, knowing that problems often present opportunities. I'm just going to write myself here and go back to one of my favorite quotes from the podcast I did on Henry Kaiser is problems are just opportunities and workloads. I think about that quote all the time. Obstacles may get in the way, but the human spirit can triumph over these things. Adversity breeds resilience and can build character.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“That you're born into. But there's a lot of lessons that you can learn from those circumstances, apply them, and then you can actually improve your life. And so even when he's noticing how poor his parents are, he learns business lessons from them that he then applies to his several businesses that he starts and operates later on. And this is one of them. He says dad was an extremely good manager of what little money we had. Dad was able to minimize the expenses since he was a natural born mechanic and enjoyed performing the maintenance himself. So not only would he do this for the automobiles, but later on when Jim becomes a pilot, he does the same thing for his airplanes. Thanks, Dad, for these business lessons, which we apply daily at Clayton Mobile Homes. Aircraft maintenance comes to mind. But in computer manufacturing equipment and all over the company, these lessons on buying good used equipment and maintaining well is applicable.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Uncle RC would always acknowledge a job well done, giving me a lasting sense of pride, the pay for one day's cotton row dragging was 25 cents. Now they're going to talk about how if you have no money, if you're making such little amount of money, how are you going to feed and clothe your kids? Well, our clothes were made out of feed sacks, so the sacks that they're using to feed the animals that are on their farm, then his mother repurposes with her sewing machine as clothing for her children. So our clothes were made out of feed sacks. Really, we would go to the general store, walk down the roads of feed sacks, and shop for our new clothes. Now, this is what was remarkable about one of the remarkable things about the book is he's not telling the story for you to be like, oh, like to pity him or to say, you know, woe is me. His overarching lesson in the book is, listen, you don't determine the circumstances.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Of responsibility. So he went from picking cotton to being able to control the mules that plowed the land at the cotton was yielded on. Dad never paid me for helping in the fields. This is his first job. He gets his first job from his uncle. Now check this out. I would sometimes plow for Uncle RC.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Cover up the window with a blanket. Naturally, we wondered what the big mystery was. So his parents, that's the only time, and this only happened usually on Saturdays or Sundays when they had any kind of alone time. More, I'm going to talk about more about his early life and then some of his first jobs. And this is just, it's mind-blowing what he had to do at five years old. So he says, all four of us took turns using the same wash tub and the same water. So as you can imagine, the first person in the bath, you're getting a really good bath. The last one, you're essentially wallowed in filth. Even something as mundane as drinking a glass of milk was preceded by a process that could charitably be described as labor intensive. As a five-year-old, I'd be up at 5 in the morning to milk the cows and bring the two gallon pail back to the house. So he gives the pail to his mom, his mom wipes out all the debris, like filters the milk as best she can, and then she gives it back to him.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“What that was used for. Someone had to empty it out every morning. So I'm going to pause right here and just want to bring up two things to you that I think are very important. One, he goes from these living conditions to the Forbes 400 list. And when the sales completed to Warren Buffett, he personally clears something like 400 or 500 million dollars. Okay, so he goes from his parents making $100 a year and having to essentially go to the bathroom in a bucket to being one of the wealthiest people on the planet. So that's a very, he has a very inspiring story. The second thing, right, which I find remarkable and I found out when I got to the end of the book was this book is self-published. He wasn't planning on it to sell as many copies as it did. He wasn't planning Warren Buffett to read it, certainly so. He just wrote it because he printed about 15,000 copies that he handed out to employees and friends and family.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“And one home cured country ham to bring me into the world. The year before he and mother grossed only a hundred dollars the whole year, so there wasn't a whole lot of cash to go around. Now I want to tell you a little bit about the environment, like the houses that he grew up in. It was 600 square feet, a log cabin, no electricity, no running, no running water, a tin roof, and no bathroom. There was no insulation to speak of, so the cabin was like an ice box in the winter and an oven in the summer. The main room served as our bedroom, where all four of us slept about eight feet apart on two beds. There was no bathroom. In fact, we didn't even have an outhouse. During the cold months we'd bring out the thunder bucket, which was kept under our parents' bed.”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source
“Ailing, anyways, even without a depression. And we surely lived in one of the poorest parts. Dad was a sharecropper farming on the halfs, which meant that the landover owner furnished the land and half the mules, seed, and equipment. We sharecroppers supplied the sweat and energy to plant, cultivate, and harvest the crops. The landowner received half of the harvest. And this is a very important sentence that Jim realized, sharecropping was a tradition dating back to colonial times, and there is no known record of a sharecropper getting rich. Well, this is how his dad, the doctor to have Jim delivered. Dad paid the good doctor two chickens, three gallons of shelled corn,”
2019-09-29 · Founders · #91 Jim Clayton (Sold to Warren Buffett) · IDENTIFIED FROM THE TRANSCRIPT · source