Marc Lore | Mercenary to Missionary: The Man Behind Jet.com, Diapers.com, and Wonder

This episode features Marc Lore discussing his journey from founding several successful companies to his philosophical shift towards mission-driven entrepreneurship.

1. Marc Lore's entrepreneurial spirit was influenced by his parents' work ethic and unique career pursuits.
2. Lore describes his strategic shift from focusing solely on profit to prioritizing mission-driven projects that offer societal benefits.
3. He discusses the challenges and successes of his major business ventures, including the sale of Diapers.com to Amazon and the launch of Jet.com.
4. Lore's vision for his new city, Talosa, is to create a sustainable and equitable community through innovative land ownership models.
5. His latest venture, Wonder, aims to revolutionize home dining by integrating restaurant quality with the convenience of fast delivery.

1: Early Influences

Marc Lore discusses his early life and the entrepreneurial influence of his parents. His father's work in various ventures and his mother's late-blooming bodybuilding career inspired his business aspirations. Marc Lore: "My mom turned into a professional bodybuilder during my high school years, which was really cool to witness."

2: Building Business Empires

Lore explains his journey of founding and selling Diapers.com and Jet.com, highlighting the lessons learned and the emotional impact of selling his businesses. Marc Lore: "Selling Diapers.com was depressing, even though it changed my life financially."

3: Mission-Driven Ventures

A deep dive into Lore's current projects, Talosa and Wonder, showcasing his shift towards impactful entrepreneurship that aims to enhance community living and dining experiences. Marc Lore: "With Talosa, we're trying to create a city that could embody the best social services without increasing taxes."

1. Embrace Change: Be open to shifting your business strategies and personal goals towards more impactful and sustainable practices.
2. Learn from Every Step: Each business venture offers valuable lessons that can shape future decisions and innovations.
3. Focus on Community Impact: Consider how your entrepreneurial endeavors can benefit society at large, not just the bottom line.
4. Innovate Responsibly: When launching new projects, think about long-term sustainability and the social implications of your innovations.
5. Balance Mission and Profit: Strive to align your business goals with your personal values and the broader good of the community.

Marc Lore is a serial entrepreneur and self-made billionaire renowned for his innovative ventures in e-commerce. From an early age, he harbored a passion for growth and risk-taking, wanting to be a farmer when he was 4 years old. While not a farmer in the traditional sense, Marc's entrepreneurial journey mirrors the same principles of cultivating and nurturing ideas into successful enterprises.

Marc has founded and sold several companies, notably Jet.com, which was acquired by Walmart for $3.3 billion in 2016, and Diapers.com/Quidsi, acquired by Amazon in 2011 for $550 million. In 2021, he founded Telosa, a proposed $400 billion futuristic city he envisions to be a model for urban living with a focus on innovation, sustainability, and quality of life. In the same year, he also launched Wonder, recently raising $700 million to build curated food halls offering a diverse selection of top chefs and restaurants nationwide.

Marc's approach to entrepreneurship emphasizes building mission-driven cultures, prioritizing customer value, assembling exceptional teams, and empowering them to achieve ambitious goals swiftly. His evolution from "mercenary" to "missionary" reflects his transition from pure profit-driven ventures to a deeper commitment to fostering startup ecosystems and guiding fellow founders through the challenging startup landscape.

Marc is also the owner of the Minnesota Timberwolves and Minnesota Lynx basketball franchises, along with partner Alex Rodriguez. Driven by a desire to push boundaries and support the next generation of entrepreneurs, he continues to inspire and empower others with his wealth of experience and strategic insights into building successful businesses.



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People

Marc Lore

Companies

Jet.com, Diapers.com, Amazon, Wonder

Books

None

Guest Name(s):

Marc Lore

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Patrick O'Shaughnessy
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Mark Lorre, welcome to the show. Wonderful to have you. Great to be here. And that's not a pun, by the way. It is wonderful to have you.

Nice to connect. You know, congrats on a big win last night. I was watching, and it's been so fun to. That was incredible. You know, I was fortunate enough to be in Denver to see it happen live, and the team just played extraordinarily well.

I mean, yeah, Anthony Edwards is looking like MJ more and more by the day. I mean, some of the moves he makes, it's like, just like a carbon copy. He did that turnaround jumper right in front of me there, and it was, it was unreal. Yeah. So he must be super proud.

Marc Lore
Super proud. Yeah, absolutely. I'm a, I'm a lifelong Lakers fan, so I'm rooting for you guys. That was a pretty brutal series. Yeah.

Yeah. I wish you would have, you know, took him a couple more games, but. It was, it came down to the wire, you know? Yeah, I know. You're an athlete.

Patrick O'Shaughnessy
You, you did track and field and you're on like a. Or you tried out for the US bobsled team. Were you always into basketball, too, or was that just something that came later in life? No, it's funny not playing because my height, you know, you know, five foot nine, wasn't. Wasn't ideal.

Marc Lore
But I loved watching basketball. I was a big Knicks fan growing up since a little kid and loved the stats and watching basketball and stuff. So it was always a childhood dream, you know, I grew up in Staten Island, New York, and parents had me, when they were 20 years old, had no money, you know, and it was just like one of those silly childhood dreams, like, okay, I'm never going to be a professional athlete, you know, not like my partner, Alex, but I'm going to, you know, dream about one day, you know, owning a team. So are you excited that the Knicks are doing well, too, or you can't. You have to kind of compartmentalize that.

I have to compartmentalize it. It's funny, like a switch went off. You know, I was a Knicks fan for over 40 years, and it was sort of like after buying the Timberwolves and Lynx, it was, yeah, the switch just went off. Not to mention they didn't, they didn't help your case with all the, all the games they were losing, so. That's true.

That's true. It was an easy switch. I'm sure. Mark, you started and sold several companies worth billions of dollars. You've raised billions of dollars.

Patrick O'Shaughnessy
You've even started or began to start a city of your own. So there's a lot to unpack in terms of your life and career. And I just kind of want to take it back for a bit around your early days. You know, growing up, I think I saw in New Jersey, you know, can you share a bit, a little bit about, like, your upbringing, what that was like, what family life was like, how that maybe influenced your entrepreneurial drive and spirit? Yeah, I mean, my, my dad, like, as I said, you know, had, they had me when they were 20 years old, and my dad was sort of a hustler.

Marc Lore
You know, he tried to make a buck doing his own entrepreneurial ventures here and there, and, you know, started off selling vacuum cleaners door to door, literally, he was a vacuum salesman. And I watched him hustle, hustle hard. He worked an incredible amount of hours and was really focused on providing for his family. My mom stayed home, take care of my brother, me, and my sister. I'm the oldest.

And then, you know, when I was in high school, my mom, who had been never an athlete, never did anything in her life, started walking as exercise, and she started jogging, then running, then lifting weights, and next thing you know, she's a professional bodybuilder. And this is, this is in high school. So it was, it was kind of wild, like, you know, coming in high school. Hey, what'd you do this weekend? Oh, you know, I just went to my mom's bodybuilding competition.

You know, they're like, that's amazing. My mom. My mom's, like, 50, you know? And I'm like, well, no, my mom, she's 36, and she's ripped. So it was kind of cool, though.

Cause she was just, like, an out of shape, typical mid thirties mom with three kids, and then she became a bodybuilder, and it was really cool to witness her dedication because I'd never seen that before. I saw my dad's drive in entrepreneurship, but didn't. Didn't know my mom had that kind of drive, you know? So it's pretty cool. And I think that definitely influenced me, had an impact on.

On me and my brother and sister because, you know, I've got an incredible amount of energy and drive, and, you know, the work ethic is certainly there, and I think it was from my parents, for sure. And I think I. You know, I heard that you weren't, like, the best student in school, but you could, like, turn it on when you wanted to, like, you know, and I think that that's, like, maybe, like, a shortcoming of school, right? It's like. It's like this one size fits all thing that's not designed for everybody and for everyone to succeed.

Patrick O'Shaughnessy
Right? Like, you always, like, you almost have to, like, play by the rules in order to do well in school. Yeah. I never wanted to play by the rules. I didn't.

Marc Lore
You know, I was the first one in my family to go to college. They didn't take academics seriously at all. Do you think it was just, like, a lack of guidance and mentorship, or was there something else that didn't. You just didn't feel like this drive to. I didn't feel a drive because I was.

I like being creative. I like inventing things. Like, if you're in science class and they're going through all the formulas, that's just. My head would just spin thinking about memorizing all these. What I wanted to do is understand, like, how do you invent a new formula?

You know, I was always like, so I would go off on my own world and think about a particular formula and think about how you can invent it. Of course, that wasn't on the exam, so I would. I didn't do well. I mean, I often joke that, you know, I got a five on all three of my AP exams. When you add the scores together, I.

Patrick O'Shaughnessy
Mean, obviously, like, you know, school, we can go, like, on a tangent and talk hours about this, but is there anything that you thinking back would have helped, maybe, like, engage you more? Yeah, I think the creativity is lacking, I think, the ability to invent, you know, new ways of approaching problems, like problem solving, inventing ways to solve it and things. It was very much. I don't know if it's like this everywhere, but it's very much about memorization. Totally.

Marc Lore
And reading and then regurgitating facts. Like, I just. I think that is so overrated. Yeah. I've had this thought before, and actually, like, a debate before about if someone with a good sense of memory or memorization, like that skill, is actually considered or perceived to be smarter than someone who is not good at memorization.

Patrick O'Shaughnessy
Even whether or not they understand the concept, is besides the point. It's almost like the one who memorizes and can regurgitate. Is that person perceived as smarter? What do you think? I don't know.

Marc Lore
Yeah, no, I definitely fall in that bucket of I can't memorize anything. I feel like you got two parts of your brain. You have, like, the memory card and the compute, and you have, like, if you have more of one, you have less of the other. And that's just the way it goes, you know, and I have a small memory card, and I like to think big, compute. But, like, you know, I have to.

You know, when I used to take math tests and things in school would have to. I couldn't memorize any of the formulas or anything that I have to kind of, like, figure out what the formula is and, you know, and. And then you run out of time on the test, and it's like, all right, so I gotta. You know, I got to see on that thing. But I.

Yeah, but clearly you did. Well enough to get into college, right? And you studied. I think I saw business and computer science, and then went and. Went off and worked in finance.

Yeah. Well, let me just break that down for you, because I got into Bucknell for track and field. That was fast. Not because I was smart. Okay?

That's the first thing. When I got there, I was on academic probation. You know, the track coach sat me down the first day, and he said, you know, I have good news and bad news. I said, what do you want to hear? I said, the good news.

He said, well, the good news is I got you in.

What's the bad news? The bad news is, if you don't get at least this certain GPA, you're not going to be able to stay here. So that was, like, my introduction to college, which was just pretty funny, and then this so called finance job. So I thought, you know, when I went to bankers trust and I got there, I thought I was going to be on the trading desk with the traders, you know, doing derivatives and stuff. No, I was in the back office doing faxes and trade confirmation, so.

And the guys I was working with, you know, a couple of them, like, you know, you know, never went to college and maybe didn't even finish high school. So it was, yeah, it was definitely a rocky start to. Things, but, you know, like, but you found that, like, when you applied yourself, you were able to figure it out. Like, whatever the concept was, whatever the subject was in school, whatever it was in your job, like, it was just like, it was a matter of wanting to learn it and wanting to be better at it, right? Yeah, yeah, definitely.

I love the problem solving element of it, but I like inventing. You know, teacher says something and I'm thinking, thinking, thinking, how could it be better? How can you reinvent it? How can you build it up differently? How?

You know, that was just the way my brain was wired always to do that. So it wasn't, it wasn't productive when it came to exam time, but it was certainly good training, I think, to be an entrepreneur, because that's what you do all day, basically. Right. So you went on to do really well in finance. You were like the youngest EVP.

Patrick O'Shaughnessy
I read at the bank that you were at and making really good money. I mean, half a million dollars, I think, like, by the time you're like 27, 28, which is insane, like, a lot of people don't even get to that point, and you had reached like, this level of success that I think, yeah, like, many people don't reach, let alone by that age. But there was something that, like, was missing. Like, it seems like you just wanted more. And obviously you went on to start a company.

But I'm just curious what it was when you're that age making that much money, what is it that's missing? Like, don't you. It just seems like you have it all, right. You had, I think you were recently married, you had a baby. What did you feel like was missing for you?

Marc Lore
I always think about, you know, are you a missionary or mercenary? You know, are you, and not that one's better than the other, but what motivates you? Is it money that motivates you in your job, or is it the mission that motivates you to, like, really want to put the time and effort in? And I grew up a mercenary. Like, my dad was a mercenary.

He told me working is about making money. There's nothing else. The idea of a mission was probably laughable, although I never asked him, but. And so, you know, I came out of undergrad. First thing I did was set goals.

It was like, all right, I'm going to make six figures by 26, seven figures by 37, and eight figures by 48. That was, that was my motto. It was like, money, money, money. And what I've quickly realized, because that's just the way I grew up, is I was making more and more money as fast of a rate as you could possibly do it, you know, at that age. And I wasn't happy at all.

Like, had more and more money, by all accounts being super successful as a mercenary, but just wasn't happy. I just wasn't happy, and I didn't realize exactly why. I just knew I had to do something different. And I had always wanted to be an entrepreneur. I grew up as a four year old.

I wanted to be a farmer because they grow stuff from nothing. And I did every entrepreneurial business you could think of as a kid, from baseball cards to recycling to car washes to lawn mowing. You name it, I did it. But I didn't have any money, didn't know how to go work at a startup or start my company. So I went to work at a bank, and it was always like, in the back of my head, this idea that maybe it's really entrepreneurship, maybe that's what I was meant to do.

And one day I just woke up and I said, you know what I really think? I really think that's what it is. I think I just don't. This is a mercenary, and it's all about making money. And I need a mission.

Something to get behind, to get really motivated is what's missing in my life. So I walked in my boss's office and just said, I'm quitting to be an entrepreneur. And it was simple as that. I just didn't know what I was going to do. He thought I was crazy because I just had a baby at the time, and he said, you're crazy, but I could see the fire in you.

Can I invest 50,000? He didn't know what it was, and he was my 1st 50 grand. And that's how my whole entrepreneurship journey started. It was just simply, and then what did happen was I was so focused on the mission of these businesses and just wanting to see them succeed. Like, it wasn't about the money.

I just wanted to win. I wanted the employees to win. I wanted the customer to win. I wanted to have fun doing it. And that really motivated me.

And there's a fire inside me like I never felt before. And that propelled me. And then, of course, the money eventually followed, but it wasn't, didn't follow as quickly as it did in banking. And banking, it followed very quickly, and it was very exponential. And it wasn't like that in entrepreneurship.

You know, it was many years of being an entrepreneur before diapers.com hit, and we exited to Amazon, so. Right. So you mentioned, like, yeah, you had a kid, you were recently married. You didn't really have an idea, but you leave this really well paying job, I'm assuming maybe you had a little bit of savings saved up just to, you know, keep. Keep you afloat for a little while.

Patrick O'Shaughnessy
But obviously, huge risk. And I'm curious, like, how you view risk. Like, what have you learned about risk? What are your thoughts on that? Because it is risky, right?

It's a risky move to just give up everything and start something. Yeah. What was even more risky, you know, looking back, is, you know, when I raised money for my first company, raised $5 million, and that was from, like, 60 angel investors. No, institutional capital. And people say, how do you get 60 people?

Marc Lore
You know, angel investors? That's a lot. And I said it was really simple. I told these angel investors that I'm investing a decent amount of my own money into it. I was pretty young at the time, and they said, oh, yeah, I see that.

I'm just curious, Mark. Like, it's kind of a weird number. Why 390,000? Like, why not 400,000? And I said, well, because all I had was 390.

So I literally took my entire savings over the first six years of being in banking, took the full 390,000, like, literally the full amount, and just invested it in the business. Now, not something I'd recommend and not something, you know, I would say, you know, the next 28 year old should do. But I'll tell you what it did do. It lit a fire under me like, you can't even imagine. You have, you know, all your savings in it.

You have a kid, family. You got to perform. You got. You got to do what it takes to win. And I do think entrepreneurs, whether it be something crazy like that or even something less crazy, but still meaningful, where you've got enough skin in the game where you can't afford to fail, I think you have to set up.

If there's a. If there is an escape hatch, I believe you'll take it because it's so freaking hard. It's so hard being an entrepreneur. I mean, I say it's like eating glass every day. And you just don't know if you're going to be cut on the way down when you swallow that glass.

It's every day. I love that because you're a lot of people, and we see this a lot, have a, have a big success. Right. And then they go off and start other companies after that, after they've made a bunch of money and had the success. And those don't play out necessarily as well.

Patrick O'Shaughnessy
And like, you know, because for that same reason, I think your back's just not against the wall. You have a big lifeboat, right? Yeah. You like escape. That's like, why am I doing this?

Marc Lore
I have all the money. Yeah, I did well. I'm good. Like, I don't need this. Like, that's the.

I've heard entrepreneurs say this, you know, second, you know, time entrepreneurs and things. I don't need this. If you, if you say those words, I don't need this, pack it up like, you're not an entrepreneur, you're done, retire. It's over. You know, and I hear that a lot.

Patrick O'Shaughnessy
Yeah. What is the 6th gear? And why is it important for entrepreneurs to know that? 6Th gear, this is a term I came up with, which is how to explain the feeling of when it, it's life or death as an entrepreneur, where it is literally this mode that you mentally get into where if you fail, it's like death. It feels.

Marc Lore
That's the way it feels. And unless you have that feeling and know what I'm talking about, where that life or death feeling, as an entrepreneur, then you don't know what six gear is because people sometimes say, oh, man, yeah, I'm in 6th gear. It's like, no, you're not. You're not, because, you know, you don't talk about 6th gear when you're in 6th gear, that's somebody who's working hard, they're probably in fourth gear, you know, maybe, maybe they're stretching, maybe, maybe fifth gear. But 6th gear, when you're in 6th gear, you don't talk about being in 6th gear.

It's life or death. You know, you're basically in survival mode, and your body, your mind is capable of doing things that you never thought possible. And I just find that period of time, like, so enlightening. You feel alive, like it is. It's a, it's almost like you, you've seen your superpowers, you know, that will bottle up your whole life, and then all of a sudden, you're doing things that you never thought possible.

When you're when it's life or death. And I know there's stories in the world about people being in life or death situations that are doing things that you can't describe as a, with human traits or abilities, you can't explain it. Right. There's been phenomenon, people lifting cars off a baby. That's like you would say, it's impossible.

You can't physically do it, but something gets inside you that gives you superhuman capabilities. And I think 6th gear is that you're in a position and you're operating at a level that you didn't think was possible. Yeah. And you mentioned investing pretty much everything you had into your first business, which was the pit, which we'll talk about. But I'm curious, as you've, as you've gained success in all these different endeavors over time, how have you been able to make sure or keep yourself in that 6th gear?

Patrick O'Shaughnessy
Right. As you've launched different companies and become more successful and launched another company, like mentally, how do you keep yourself in that mindset? I think you have to, it really comes down to how much skin do you have in the game and skin personally and then also reputation and in wonder. For example, my latest startup, I've put a tremendous amount of my own capital into this business. Like a good percent of my net worth in big numbers.

Several hundred million, I've read. Yeah, yeah, exactly. And so it's all relative. It's a, it's, it's, you know, it's a, it's a big number for me. I can't afford it not to work.

Marc Lore
I've also got every family and friend in it as well. And, you know, also there's a tremendous amount of, you know, reputational risk too. You know, I've had two really big exits. Both of those companies don't exist. You know, like this, this is, this is the one that every entrepreneur wishes and hopes for.

You know, I really believe that's, that wonder is that for me? You know, something I've been working my whole life for, to have an opportunity to create a household brand, one that really has a positive impact on the world and changes people's lives for the better. Like, you only get one shot, I think, in your life to really do that. And this is my shot. And so, you know, can't let it go.

But, but if I didn't put as much personal investment into it and have all my friends and family in and all that stuff, like, yeah, it's been really hard at times. Like, it would have been very easy to say, what am I doing 52 years old, like, I don't need this. You know, it never really crushed my mind. Like, it's not, I'm in that mode of can't fail, you know, won't fail and fail. Won't fail.

Just won't let it. I just won't let it. I'll do whatever it takes. And if I need to go into 6th gear and get into survival mode, I'm prepared to do that. Like, that's, you have to have that mentality.

I see too many entrepreneurs creating, like this escape hatch for themselves, and it's, it's too, it's too easy. That almost seems riskier, right? In some ways. So we'll talk about wonder. But going back to your first venture, the pit, which was like this sports stock market where, you know, that you started with your childhood friend, you mentioned raising like 5 million from 60 investors, which I don't know how you even begin the raising part is one thing, but managing that cap table, I felt, I feel like, was probably a whole different, whole different chefs in the kitchen.

I didn't even know what a cap table was. So we were at our first institutional investor meeting. We didn't get any institutional capital. We had our first meeting, and the investor, I'll never forget it because it was so embarrassing. The investor said, can you tell me about your cap table?

And I look at Vinnie, he looks at me, and we're like, what's a cap table? And it's like they were like, okay, yeah. You've gone on to raise a lot of money, billions for future companies that you started, diapers.com and then jet and wonder, what did you learn from that first experience raising money that helped more and more as you started to fund. Like, the first 60 investors? Yeah.

Patrick O'Shaughnessy
That first experience, yeah. One thing I learned, one thing I learned is investors love when founders have real skin in the game. I think I learned that early. That was big. Never would have raised that money without, without that.

Marc Lore
I think now this is, obviously, I learned a lot of things since then, but back then, I definitely learned that. I definitely learned the value of having a good team. Like, good people. I think people in the early stages of a startup are investing in people and they want to know those people are good and they're committed and they have real skin in the game. That was probably the first learning.

Patrick O'Shaughnessy
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Take payments by smartphone, transform your tablet into a point of sale system, or use Shopify's Posco mobile device for a battle tested solution. Plus, Shopify's award winning help is there to support your success every step of the way. Do retail right with Shopify. Sign up for a $1 per month trial period@shopify.com. Founderhour once again, go to shopify.com founderhour to take your retail business to the next level today.

So you end up selling the company to tops, and then you, as part of that deal, I'm assuming you had to go and work there. Um, yeah. But then there came a point where you weren't happy again there, like, you were just like, I need, I need something more. I need something more. At that point, I knew I loved entrepreneurship.

Marc Lore
We had started the company, grew the company and sold the company, all within 18 months, and just had the bug like I was. I knew that was it. I just was going to be forever an entrepreneur at that point. And, but I had to pay my dues inside the tops and, you know, learned, learned, learned a ton over those few years, but all the while thinking about what's next. And so you went on to start diapers.com, and I know you've shared this story before, so I'm kind of glossing over because I want to kind of get in between the lines there.

Patrick O'Shaughnessy
But you started it, and, you know, diapers, they're a low margin business, right? Like, you weren't doing it to make money on diapers. I'm assuming you had a grander vision, did you, at the time when you first started it? And I know eventually you went on and had other products, lines and baby products and then other companies selling other things, like for pets and toys and that kind of stuff. But initially, when you started diapers.com, what was, like the grand vision of what you wanted to build?

Marc Lore
Yeah. So it wasn't as clearly articulated as, like, some of my new adventures back then. But I'll tell you, the thesis was very simple. We had, I had gone online and saw that diapers were being searched in Google 200,000 times a month and nobody was really selling diapers. And I was a new dad.

And just thinking, that's kind of strange. Like, why can't you get normal prices for diapers delivered to your door? You can get everything else, pretty much. They did sell diapers, but they were like, ridiculous prices. So talked to some people in the industry and they said, oh, yeah, you don't understand, Mark.

Diapers are a loss leader for target and Walmart. They basically break even or even lose a little money. And I said, oh, okay, well, why? Because they drive parents into the store and then they buy everything else. I said, okay, well, so online, why can't we do a similar strategy?

And people would say, because you're going to get destroyed. The product itself is a negative margin. If you add on shipping and fulfillment and all these other stuff, you're going to be losing like $10 a box. Like, it's unsustainable. And so that was the original.

So nobody, including Proctor Gamble and Kimberly Clark, the big diaper manufacturers, thought this made any sense. But the thesis was, if it's a loss leader in a store and you can buy 100,000 products, if online you could buy millions of products, couldn't it be more of a loss leader? Couldn't you lose even more in diapers? That was just the original thesis. And it played out.

Like, if you look at Amazon or Walmart today, they sell it the same price in the store and online, and they lose $10 a box online, and they sell a shit ton of other stuff. So it was proved out. Now, I would have liked to have been the one to have, you know, proved it out all, you know, taking it all away. But that wasn't. Wasn't in the cards given.

Amazon had other ideas. Right. Yeah. Like, they. They approached you and eventually started lowering the prices of their own diapers and really, like, squeezing you guys out and really not giving you much of a choice to.

They lowered the price of diapers 30%. Yeah. I mean, I don't know who can survive that. That's crazy. Yeah, yeah, yeah.

Patrick O'Shaughnessy
So they were launching their own, like, Amazon mom, and they wanted. I'm just curious, though, like, why did they want to buy you guys out? Why don't they just crush you? Why didn't they just say, like, we'll do it ourselves? Like, why do we need you?

Marc Lore
I think what happened was they cut the price of diapers 30% and they burned like $100 million on diapers. And all it did was marginally slower growth rate. We're still growing. And they're like, wait a second. Like, there's a real brand here.

There's a real loyalty. Like, what they're doing is special. I think that is what they told us. And you had a great domain name, too. I mean, diapers.com, that's.

Yeah, yeah, exactly. And then we had. We had wag.com for pets. We had soap.com for, like, online drugstore. We had yo yo for toys.

We had, I don't know, maybe ten different websites that were all connected by our common car. They were like specialty shopping experiences with a common cart. And I always, often think back to that, like what? You know what? Where would we be today if we just were able to raise capital and not have to sell?

But back in the day, I think we were looking to raise 100 million. There was not the same types of investors there are today. You just couldn't raise 100 million and certainly couldn't raise it. With Amazon coming after you the way they were, we really had no choice to sell it. But that was depressing when we sold that company, even though it was life changing, you know, numbers in terms of, you know, sale price.

And my co founder as well was depressed. We didn't celebrate. We actually were depressed. That's sort of the dream. The dream was over.

Patrick O'Shaughnessy
I mean, it makes sense because, look, thinking back to where you were when you left your job to first start your first venture, like this missionary mindset and this, like, mission driven mindset, when you haven't fulfilled the mission and you've sort of been cut short of that. Yeah, like you said, the money was secondary and you were really trying to accomplish something and you weren't able to do that. So it makes sense. And then, so you went and worked at Amazon for a bit, and then, so there was this thing that I want to talk about, this, like, innovative piece that you guys figured out, which was how to optimize the space in the shipping boxes. When you were shipping the diapers, you were optimizing for other items to include in the boxes that would provide an incremental increase in cost for the end consumer.

But for you, it was a big revenue opportunity. That technology or that innovative piece, when you went to Amazon, you eventually left Amazon to start jet.com based on that thing. Based on that same innovative piece. From what I understand why you saw these inefficiencies at Amazon when they bought you, why didn't they implement that? Why didn't they figure it out to the point where you wouldn't have had the idea to start Jet.com?

Marc Lore
Dot I think, honestly, I think they were just growing fast like any startup, and they had so much low hanging fruit everywhere. They were making money and growing fast, and there was no competitor that forced them. And a competition usually forces you to innovate, and they didn't. They didn't have to. So, for Jet.com, you guys are building this platform.

Patrick O'Shaughnessy
You've raised a lot of money to build out the infrastructure, the warehouses, the getting all the product and all that stuff. And then, like, a year in Walmart comes to you and says, we want to buy you for like, three and a half, almost $3.3 billion, or something like that. Was that. Was that innovative, that piece that I'm just. I'm talking about around, like, optimizing the shipping and all that kind of stuff?

Was that proprietary technology that that's what they were buying? Or, like, was it something that they could have done themselves? I think at the end of the day, Walmart felt like they were behind in e commerce. Going back, this is 2016, they were. They were just behind.

Marc Lore
And they needed some shot of adrenaline, something to put a kink in the curve. And I think they felt that we had hired some of the best people in e commerce that were working at Jet. I had a long history in e.com. So did some of the other key folks in the organization. And they, unlike Amazon, weren't buying us to crush us.

They were buying us to accelerate their own business. And so that, for us, was very much further in our mission. Our mission was to create a formidable competitor to Amazon. And Walmart comes to us and says, hey, how would you like to leverage all Walmart stores? We have a deep balance sheet that we can invest here.

You don't have to worry about raising capital. You could just focus on execution. And we want you to build this, and we want you to combine jet and Walmart and go after Amazon. That was fun. Unlike the Amazon sale, even though it was short, it was only, like you said, a year and a half.

We didn't feel like it was like the mission was over. The mission was just accelerated with Walmart. Yeah. So that's. That's like two different.

Same kind of, like, sale. One feels terrible, one feels great, and it was just. One was just about the money, and it was depressing. And in the case of jet, the mission was front and center. Now, we did make a lot of money.

So missionary mentality, usually, you know, are. They mutual exclusive or they could they. Could they go in the same direction? Focus usually leads to money, but you can't be driven and motivated by the money. You have to be motivated by the mission, and then the money follows.

And so I think I knew I was a mercenary when I was growing up and early in banking, and I really knew I was a missionary when I was depressed after making life changing money, you know, it's. Yeah, it's. There's no right answer. I think you just have to find what it is that really motivates you. It makes you happy.

Patrick O'Shaughnessy
Yeah. So as part of that sale, you had to go to Walmart and again, stay there for a few years. You were your president, I think, CEO of the e commerce division, and saw the market cap just like double while you were there. I'm sure that had a big role to play in that. And now at this point in your career or life, it's like kind of like, I think you like, almost close to 50 years old.

And a lot of people, 52, 52, a lot of people would just, like, call it. Call it in and just hang back, buy a sports team and just chill and go to the games. But you didn't stop there. And so now I want to talk about this, like, new sort of half of your life that you've kind of gone in this different direction, somewhat different direction, but you started a city, or you're building a city called Talosa, which I'm really intrigued by. I want to talk about that and then we'll talk about wonder as well.

But I'm curious. This was like maybe a few months, I think, after you left Walmart, I saw that you launched Talosa, which is like this proposed utopian planned city. What even inspired you? Where did the idea come from? At what point did you start thinking about this?

And where are things at now? Yeah, I think it just really bore frustration with how divided the country's become. And I just felt like at the end of the day, we're all human beings on this planet together, and we all want the same thing. You know, we want to be happy, healthy, safe, good values, treat people right, you know, do the right thing. Like, there's some basic fundamentals.

Marc Lore
And the country was so divided and is so divided today. And I thought, like, what is really at the core of the division? You know? And I think on the one side, people want to have these incredible social services similar to what we have in Scandinavia. Education, free education, medical care, jobs, training, affordable housing, and somebody's got to pay for it.

And I think the other side would say, I don't want to pay higher taxes to pay for the social services. I think that's sort of at the core, and there's lots of differences and stuff, but at the core, fundamental core, I think it boils down to that. And I thought, is there another model for society where you could have both? And I read this book, progress in poverty by Henry George, late 19th century economist who basically proved that the real problem is land ownership, that there's a finite amount of land. People who own land basically have a monopoly, and they're able to extract as much profit as they can out of the land until people are no longer willing to work.

And so by definition, there's always going to be a big class of people just getting by, because the landowners extract all that value. And so I was fascinated by this, and I thought, what would happen if the land wasn't initially owned by people that claim, claim the land, but the land was owned by the community, by a community foundation. And so I thought, okay, we find land in a desert where it's very cheap. The community foundation would buy the land and then encourage people to come live in this city being created. But the handshake with the citizens are, if you come live in Tulousa, you will get the best social services anywhere in the world and you won't have to pay higher taxes.

Well, how is it funded? The community foundation that owns all this land will see incredible appreciation in the land. If millions of people move to the desert, like if people move there and it's a normal multi million person city, the land's going to be very valuable and the foundation will own it all. And the idea would be that the foundation, once it became an established city and the land was like a normal asset class, and you've extracted all that appreciation, that the community foundation would sell all the land and would create an endowment, and as much as $500 billion endowment upon which they would earn, call it $25 billion a year, $30 billion a year. And that 25 to 30 billion would be invested in the best education, healthcare, jobs, training, affordable housing for the residents that live there.

And if people trusted this community foundation because it's done such good in the form of education and health and things like that, then maybe people would donate to the foundation to do even more good and create this incredible virtuous cycle. Right now, people don't like, donate to the city, that's taxes, but they donate to schools and hospitals. So if you donate to the foundation, there would be certain projects that the foundation would identify needs that the citizens wanted, parks or things that the government wasn't able to do, and the foundation would come over the top with these donations and, and use the endowment and the donations to do incredible things for the citizens of the city. So that was kind of. It was meant to be a more equitable society from, from the standpoint of.

Patrick O'Shaughnessy
Like, laws and regulations. Do you think like, a lot of the problems are at the city level. Like, I mean, I'm assuming I saw that the goal is to have it be like this multistate thing where it's like a part of it is in Utah or Nevada or it's not all part of one place. But as far as the way that would work and the government of it, do you see that working well with the federal government, for example? Yeah, it wouldn't be, it's not meant to be a closed city.

Marc Lore
It's not meant to be exclusive in any way. It's meant to be like any city currently in America. People free to live there move there. Same federal law, state law, everything's the same. The only difference is really this community foundation and all the incredible social services you would get living in the city that complements what the government's doing.

But if you're going to build a city from scratch, might as well make it the most sustainable city in the world and take a page out of the startup manual and have a set of values and a mission for the city itself. So people are proud to live there, are proud to know that they're furthering the mission of the city, and that there's an incentive to do good. And if you do good, the value of the land increases, the endowment's more valuable, and so you get even better services. And to create this sense of pride and feeling of like, yeah, like, this is my city, you know, and that exists to some degree, but not to the extent I think it could. And it's certainly, it's sort of like the difference between being in a startup culture and a big company corporation.

Patrick O'Shaughnessy
Yeah. How about aesthetically? Like, are these renderings pretty accurate that I'm seeing online, or, like, I love the look. I mean, like, I was recently in Chicago and I'm like, this is such a beautiful city, right? Like the buildings, like, there's an architecture tour that you do and learn a lot about these, like, the history behind these buildings, and it's not like these boring boxes that you see, like in other cities.

So, I mean, if you're starting from scratch, I'm sure you're thinking of it from that perspective, too. But, you know, how, what is your approach to that, at least? You know, I think there's some of those designs and things are like, you know, the starter city, I think you need to kick start it. But I also think it's important that it can't be planned. It has to be organic, and it has to have a soul.

Marc Lore
And so it's really hard to get that done. And we've thought about it a lot. And the conclusion we came to, and we don't know if it's right, is to sort of build it like a university class. So the first 50,000 people you basically would apply and you'd build a diverse class, different occupations, income levels, different race, religion, things like that. Build a very diverse class of 50,000 people that believe in the mission and really believe in creating and testing a new model for society.

If the 50,000 people would move in on a certain day or over the course of a few months, like a university, all right, doctors show up and teachers show up and those 50,000 people basically moving together, it immediately gives the city like proper density, whatever you want to call it. So I think it was a few months. And by the way, I'm excited, I'm so excited to see how all of this comes together. And I know it's a big undertaking. A few months I think after you announced Talosa, you announced wonder or you launched wonder.

Patrick O'Shaughnessy
And I'm just curious, first of all, you alluded to it earlier, but what is the big opportunity that you see with wonder that doesn't exist today? And why do you think that the world needs it? Yeah, I think it's a great question. I think consumer behavior is changing. I think the younger generations are putting more of a premium on convenience and time.

Marc Lore
They don't want to spend time cooking. So if you're willing to pay a price for convenience, they don't want to eat out every night. That's expensive and it's not even that convenient. You want to be able to eat in your own home and you want to be able to eat without having to cook and eat good quality food and get it fast. And I feel like the home dining experience, if you can call it that today, is somewhat limited.

I mean you can get on the delivery aggregators and order from local restaurants. But the time uncertain, cold food delays, customer service is tough and it's just because they're not vertically integrated. It's, the delivery is separate from the restaurant and it's really hard, it's challenging, doesn't matter how good you are at it. And so the vision was what if you vertically integrated, what if you were able to create 30 different restaurant chains, all different cuisines, and manage to put them in 12800 square foot kitchen and drop it right in the center in the heart of where people live and be able to cook all the different restaurants and be able to deliver it to a home in under 30 minutes hot. So would this kind of be like a.

Patrick O'Shaughnessy
Like a ghost kitchen, like, from the start, before it's cooked or after it's cooked. So it's not ghost kitchen in the sense that it looks like a fast casual. It looks like a chipotle. It's got a brick and mortar. It's got some seating.

Marc Lore
It's got pickup at one door, half the orders of pickup and half a delivery. So it definitely leans more delivery. But it's not that different than a fast casual. It's just we've created 30 fast casual chains, and we've built the technology, and we've invested hundreds of millions in the culinary engineering and food science to be able to cook all 30 cuisines using just two pieces of electric cooking equipment. But there's no hoods, there's no gas, there's no stoves, there's no prep, no chefs in these locations.

And so we're able to cook food really fast, really high quality, and we're able to order as a customer. Multiple restaurants in the same delivery, so everybody in the family can order from a different restaurant. It all comes, boom, under 30 minutes hot. We won't deliver more than six minutes in the city and more than ten minutes in the suburbs. So you're getting it really fast.

And we've got it down to a point now where we can cook a bobby filet, filet mignon steak in six minutes to perfect temp every time. We can cook pasta without any water sauteed al Dante, we can cook a pizza in 88 seconds. Chinese food without a wok. Like, we've really invented something. And I think, you know, it's allowed us to really create an elevated home dining experience.

Patrick O'Shaughnessy
Yeah. What about from a price standpoint? Obviously, when you look at the economics of a lot of these, like, delivery companies, like doordash and postmates, it just. It doesn't. It's a lot.

It's expensive to always, like, every day. If you're ordering from one of these, you're spending a lot of money on food. Do you see that in terms of the economics of wonder, that over time, you can reduce the cost to the consumer of getting quality food? Or is it just a new norm that you have to get used to? No.

Marc Lore
Being vertically integrated, being able to get the full margin of cooking the food, the full margin of the restaurant, and the full margin of delivery, but then also the benefit of the fact that you own both the cooking and the delivery. There's a lot of synergies there to take costs out of the system. For example, when we cook, if you ordered four different restaurants for four people in the family, all that food will finish cooking at the same time. It'll immediately go into a hot bag and we'll time the cooking with the courier. So your food never sets and the courier never sets.

And so that integration not only helps you get the food hotter and faster, but at a lower cost. And so it's quite profitable to be vertically integrated. And we share those profits with customers by lowering prices. And so that Bobby Flay steak is $32 on wonder. That same steak is $55 in the restaurant.

And on the delivery aggregators, it might get marked up ten or 15%. It might be $65 or $60 online. What do you see as the future of that? You mentioned it's more expensive in the restaurant because obviously there's labor and the rent and all that stuff baked into it. Like, do you see that over time, assuming, like, you know, in the perfect world, like, wonder is as big as you hope it to be, right?

Patrick O'Shaughnessy
And like everyone's doing, ordering this, do you see, like, restaurants still having like a place in the world? Yeah, I don't think. I don't think we're competing with restaurants necessarily. I think we're competing with that one or two nights a week that you were going to cook that now you're ordering in and that's it. So I think we'll take a share of the growing food delivery market for sure.

Marc Lore
Like, that market is 100 billion now. It was 00:13 14 years ago, and we expect it to go to 500 billion by 2036. So it's growing very fast and there's certainly a lot of share that's going to be up for grabs. And we think we've got a compelling value proposal. It's cheaper, faster, hotter, higher quality, more on time, more accurate.

Like, it's just a really good experience. We've got eleven locations open now in the New York metro area, but over the next 18 months, our plan is to open up 80 locations. So we're really starting to go into hyper growth mode right now. Love it. Any plans for LA?

Not yet. Not yet. All those 80 are going to be, for the most part, in tri state. And then we'll start working up and down the northeast, but it'll be quite some time before we get out of the northeast. So just sort of like, encompass all this.

Patrick O'Shaughnessy
Speaking of your mindset and your sort of approach to entrepreneurship and this, like, contrarianism that you've had, you've talked about your sort of theory of, like, putting the cart before the horse. Can you share a little bit more about that? I just think as an entrepreneur, I mean, you taught don't put the cart in front of the horse. I think as an entrepreneur, you have to do that. You're doing that all the time, because by putting the cart in front of the horse, you kind of, like, are able to flush out and learn and get answers that allow you to dictate the correct strategy going forward.

Thinking about all these different ventures that you've started, and they're all in somewhat different industries, what would you say is, like, your overall goal in life? Like, what does a like? Because. And I would be just like, you like this, like, maximizer mentality of, like, okay, I've reached this point in my life. Okay, what's the next point?

And what's the next point? And what's. How could I just, like, get better and better and better? But I'm just curious, like, do you have this overall sense of what success is to you? Like, let's say at the end of your life, you're looking back like, I'd be happy if I did this, if I accomplished this.

Marc Lore
Yeah. I mean, it's. I don't have a specific goal, per se. I think, you know, I like to say, you know, like, my personal mission, what, you know, what drives me is, you know, living life, loving deeply, and changing the world like that. That's sort of my sort of personal mission statement.

And so I sort of, you know, if I'm doing one of those three things, I'm happy. And at the end of the day, it is about being, being happy and giving back, you know? And so I don't know. I don't have a clear vision for my life. Like, I want to accomplish x, y, and z.

I just want to be a good person. I want to enjoy life. I want to give back. I want to make people happy, and I want to put my mark on the world, you know, change it in a little way that I. That I can.

That's really it. I don't know how that's going to, you know, right now with wonder, you know, I think the big vision is to create a super app for mealtime. Anytime you want to eat a meal, you can pull up wonder and get food any which way you want it and be able to create a meal plan, be able to within a budget, you know, lay out the meals for the week, tell you your health score, you know, be able to give you advice on things you can do to have a better diet, to be healthier. Like, there's lots of ways that you can take wonder in the future that is super motivating for me that really could again make a positive impact on the world. Not just better quality food, but also better overall life experience and health.

Patrick O'Shaughnessy
I love it. Well, it's been an absolute pleasure. Mark, you are an entrepreneur's entrepreneur, and I think the world needs more people like you to sort of have these moonshot ideas and really go after them. And there's so many problems in the world that could be solved through entrepreneurship and just, you know, I hope that more and more people listening to your story could be inspired to go out and, you know, do their part and help change the world for the better. But I appreciate the time.

Hopefully we can meet in person someday. Someday soon. But there's been a blast. Yeah. Thank you.

Marc Lore
It's been a blast. Thank you so much for having me on and have a great night. Thanks, Mark. You too.

Patrick O'Shaughnessy
You too.