In this week's Rule Breaker Investing podcast, Motley Fool co-founders David and Tom Gardner and producer Mac Greer are mining the radio vault and revisiting some clips from their old radio shows.
In this segment, they play a clip from 2000 featuring Jay Walker, founder of Priceline -- now called Booking Holdings (NASDAQ:BKNG) -- followed by a clip of Jeff Bezos, founder and CEO of Amazon.com (NASDAQ:AMZN), contrasting their views on the future of the internet.
A full transcript follows the video.
This video was recorded on April 11, 2018.
Mac Greer: Next up, let's pivot to Jay Walker. This is an interesting clip. Actually, that's for our listeners to decide. I hate when people tell me that something is interesting or funny.
Tom Gardner: You set the expectations high.
Greer: I know. That's ridiculous. A fascinating moment.
David Gardner: This may or may not be an interesting clip.
Greer: This may or may not be to your liking. What I can tell you is at the time of this interview [this is 2000], Jay Walker was the founder of Priceline. By the end of 2000, Jay Walker has left the board, has left Priceline, and Priceline is trading around $1 a share, so they really got whacked. And now, of course, Priceline has been incredibly successful, but this is Priceline founder Jay Walker in 2000 talking about the future of the internet.
Jay Walker: When you look at companies like Yahoo! on the net, I think you see a company that clearly gets it. That understands its scale, its value-added proposition. That understands its business model. That isn't the business model de jour and is very focused on its own growth and meeting the expectations of its customers. And I think that's true in a fair number of areas.
I think the big question of the internet and e-commerce is, is the future of e-commerce on the net really a future about trucks driving around the neighborhoods of America delivering products, or is the future of e-commerce on the internet really about using the net for its information capabilities? Let's say delivering prices instead of products and thereby leveraging the bricks and mortar equation that's already in place in the market?
Which is not to say it's an either/ or proposition. It's not. I mean, obviously there are going to be companies who are very successful on the net who deliver products, just like there were catalogs who were very successful in the real world. But I think the future of e-commerce is largely misunderstood as the old world replaced on the net.
And that's just not the future of e-commerce. The future of e-commerce are truly new and innovative models that scale rapidly, that leverage information assets in whole new ways, and solve problems for both buyers and sellers.
T. Gardner: Long-term Priceline shareholder.
D. Gardner: And these days it's been renamed. Jay Walker is no longer there, but it's Booking Holdings, and it's been a tremendous winner. I'm wondering here, again. Do we have another #Macsandra situation, Mac? If you were to call up Jay Walker, do you think he would join us on one of our podcasts? I'm hoping so!
Greer: I think he would and for me one of the first questions is please tell me you held your shares. This almost makes me sad, because the company that he described...
T. Gardner: He's probably doing great by it.
Greer: Probably so.
D. Gardner: Well, let's be clear. He has done very well. I don't actually know his holdings, just like I didn't even know Bezos's holdings, really Tom, and that was great. You brought that fact to the show.
T. Gardner: Mac, how much money does a person need to be happy?
Greer: You know...
D. Gardner: You're taking us to a new place.
T. Gardner: I think what you're saying is Jay Walker could have probably had billions and billions of dollars more than he does, and you're saying that you feel that's deeply sad.
Greer: I wouldn't say deeply sad. I think that the entrepreneur who had this vision for this company -- that ended up becoming this incredible company, and who predicted the future, at least in part [the information economy and all that] -- I think he should benefit from his creation.
D. Gardner: And he did very well. In fact, I don't know if you guys have seen it. I saw either a documentary, a clip that goes inside his house. I believe he lives in Connecticut. I'm looking this up. It's the Walker Library of the History of Human Imagination. It is a remarkable structure and a huge library.
T. Gardner: And Mac is trying to shrink him...
T. Gardner: ... by saying he probably didn't hold his shares.
Greer: You're saying I don't need to do the Kickstarter campaign. No Kickstarter campaign.
D. Gardner: Do you guys remember the pictures by Escher of paradoxical mazes? Like you're walking up one staircase and then you flip over? That's the whole design of his Walker Library -- The History of Human Imagination. And it has priceless tomes. Anyway, Jay Walker's doing great, and he's become a cultural preserver. This is a great American.
T. Gardner: I would like to say, however, that I think the way history has played out has not flowed in the direction of the conclusion from that statement that he made. And I guess I'll associate it with I believe this. I believe that we all underrate how much we love convenience as consumers. Really how lazy we are. So, if you're telling me a truck will come by and drop it at my house or where I can go walk six blocks and get it...
Greer: Yes, he was all for that part.
T. Gardner: I'm going to get the truck dropping it off. I think I told John Mackey, who's on our board [the Whole Foods founder] that if Whole Foods provided a service where they would actually place the food in my mouth for me, I would look at the price tag.
Greer: Oh, my gosh!
T. Gardner: If they would deliver the meal and they would actually...
D. Gardner: Tom, you would like to be spoon-fed? Is that the news you're breaking on this show?
T. Gardner: Yes. It starts that way and it ends that way. We are close to the end.
Greer: This clip reminds me a bit of something that Jeff Bezos said, and it's another clip, and so I want to revisit just something Bezos said.
Bezos: If you look long term, clearly there are going to be some companies [some of the largest market-cap companies in the world] 10-plus years from now that are going to be born of the internet. I think that you can predict that very confidently. But I think that trying to predict today which of those are going to be is very difficult. And in fact, if you look at the history of pioneers [and clearly, I'm including Amazon.com in that group], if you look over the past of say other revolutions, like the PC revolution and so on, the history of pioneers isn't always that good.
D. Gardner: I like what you're doing, Mac. You are almost hyperlinking from the Walker interview to the Bezos interview. You're creating The Great Conversation on this podcast, and you had Bezos speaking to Jay Walker across time...
T. Gardner: The public messenger.
D. Gardner: I think Tom was right, earlier, when he said that Walker didn't necessarily nail it. Actually, a lot of the things that we associate with the real world have been replaced with the internet, and Bezos's line about the biggest, best companies of our time being born right then ... that was true.
T. Gardner: And to Walker's credit, he did say it's not either/ or. I'm sure he was investing in a way that led to him finding a lot of those winners. I will just say, since I'm sitting here on the Rule Breakers podcast the number of these companies that showed up in Rule Breakers or the original Fool Portfolio, David, is incredible. Obviously, there are some misses in there, but to have found the companies that you found and to have held them as long as you have; what are the next two or three of these over the next 15 years?
D. Gardner: We've talked about that on all the other shows this year, so there's 51 other weeks for you to listen and get that answer, Tom.
T. Gardner: OK, good.
D. Gardner: But this week...
T. Gardner: I want a free stock pick.
D. Gardner: ... we are living back in the...
T. Gardner: For Mac Greer. So, we can see if Mac buys it 10 years from now.
D. Gardner: Got it.