Scott Barry Kaufman is a cognitive psychologist at the University of Pennsylvania, the scientific director of The Imagination Institute, and the author of Ungifted and Wired to Create. He recently hosted James Altucher, entrepreneur and bestselling author of Choose Yourself, for a conversation on the secret to doing what you love without reporting to someone else, making the most of failure, and finding business opportunities in unusual places.
This conversation has been edited and condensed. It originally appeared on Scott Barry Kaufman’s podcast, The Psychology Podcast.
Scott: The New York Times called [you] “the world’s least likely success guru.” Later in that article you say, “I don’t want to be viewed as a guru.” That’s what people have viewed you as, whether or not you wanted [that]. How do you think that happened?
James: I don’t know, because all I talk about is messing up and what I did to get out of the hole. I was broke, bankrupt, and divorced, and I write about how I got out and succeeded again.
I never give advice—I say my autobiography and people can do with it what they want. I’m more interested in telling people, “Success could happen or not, but it’s okay to fail.” People need permission to have that. We’re trained from birth: school, job, marriage, family, white picket fence, retirement, cruise line tours, and then death. We’re programmed not to break out of that.
Scott: I’ve noticed that with a lot of people who call themselves ‘self-help gurus,’ there’s a similar pattern: they will talk about how they once were a “loser,” and there’s this arc. It’s almost some marketing ploy, a way of saying, “I was once you and look what you can become.”
When I meet you, I get a level of genuineness that I don’t necessarily get from other people in this space. I would love for you to walk me through the early days. When you were failing, did you ever think, “I’m going to get out of this hole and inspire others”?
James: No. When it happens, when you’re on the ground and broke again, it just feels enormously stressful. It hurts to go down. I’ve gone from big success to totally bankrupt.
I had a very middle-class upbringing. I had ups and downs, but nothing too horrible. I started a business, it was successful and I sold it, I made a lot of money. Then, there was one summer where I figured, “I did it. I can’t possibly fail now. I made enough money. I’m going to do whatever I want and it doesn’t matter.”
I was so stupid. I basically lost everything, including the home I was living in. I lost millions of dollars. I checked my ATM machine and had $143 in my bank account after having millions just a few months earlier.
Scott: It’s hard to lose that much money that quickly.
James: I’m very talented at that. I felt like, “I won the lottery and I’m never going to get this chance again.” That was it for me. I should be dead. I had little babies at the time and I figured, “They’re never going to remember me as a father, but one thing I have left is this big life insurance policy.” I would start using search engines to figure out the best way to kill myself where it won’t hurt. It turns out there really is no way.
“When you experience a lot of stress, there’s two ways to get out of it. One is to say, “That was that, I’m never going to succeed again. I’m just going to drift away.” Then there’s a positive way, which is, “Now I’m going to start coming up with ideas for new things I can do.”
Scott: That’s an argument against suicide.
You’re kind of the poster boy for the field of post-traumatic growth. There’s a certain amount of people who have post-traumatic stress disorder who don’t ever really recover from traumatic situations, but there’s a certain proportion that take it and use it.
James: When you experience a lot of stress, there’s two ways to get out of it. One is to say, “That was that, I’m never going to succeed again. I’m just going to drift away.” That’s the negative way. Then there’s a positive way, which is, “Now I’m going to start coming up with ideas for new things I can do, and I’m going to do that today.”
When I fail now—because failure really never ends—I remind myself that that’s the approach I need to take. Initially, the first times I would reach those devastating moments, I didn’t know what to do. I just thought, “This is the worst feeling possible and I’m never going to get out of it.”
There’s all these scientific studies: here’s what’s positive, here’s what’s negative. Here’s what successful people do, here’s what unsuccessful people do. That doesn’t work when you’re on the floor. You’re a sample size of one and you have to make it work. I had to look at myself and say, “What kept working when I went up and what kept failing on the way down?” I think I’ve figured out what boxes I need to check whenever things are going bad.
Before, I never realized that I could fail at anything. Now, even if I have a slight blip, I start to get anxious and I have to go check through my boxes to deal with it or else I’ll stay up all night.
Scott: You’ve given some tips for how to overcome anxiety. What’s the alien trick? Do you still do that?
James: I do that every day. When I wake up, I picture that I am an alien from outer space that has just landed in this body. I have to figure out what this body is and what mission it needs to accomplish today, because tomorrow I’ll be gone. That means I don’t have to worry about the results of my actions today. I don’t have any baggage from the past and I don’t have to worry about tomorrow. I just have to make positive actions today without considering the past or the future.
Scott: What other tips have you found to reduce anxiety?
James: What’s very important is taking positive actions. At the end of the day I’ll ask myself, was I creative today? Did I make a list of 10 ideas for either businesses, books, articles, or ways I could help somebody else? I try to be as creative as possible each day. I also make sure I touch base with friends each day. Depressed people need to do that, so why shouldn’t I do that when I’m not depressed? Why wait? We all know friends boost oxytocin.
Another thing I try to do every day is eat nutritiously, exercise, and sleep eight hours. That’s the easiest possible hack on your mood. I try to go to bed before 9 p.m.
There’s all sorts of physical benefits of sleep that cures the mind of anxieties and stresses. Exercise releases a lot of endorphins. How you eat determines how your energy is used by the body and the brain. These are easy hacks on anxiety. Some people will charge a gazillion dollars for some seminar, but it’s really that simple.
“At the end of the day I’ll ask myself, was I creative today? Did I make a list of 10 ideas for either businesses, books, articles, or ways I could help somebody else?”
Scott: You have a very distinct style, and it makes me think there are lots of different fields you could do. You could probably do a stand-up comic bit, right?
James: I’ve done stand-up comedy. I’m obsessed with stand-up comedy.
Scott: Of course, because the truth is funny. The more true you are about something the more funny it is.
James: I have found that when I’m nervous or feeling particularly neurotic and I get out of my system what I’m thinking, people tend to find it funny. Getting it out actually makes me feel better.
It’s therapeutic for a lot of reasons. When you’re honest about your bad experiences and you share them with your tribe, your scene, or your Facebook friends, people relate. You’re bonding, and bonding is one way of getting over anxiety and becoming more creative. Plus, when you tell a story, you get better at telling stories. Storytelling is a 200,000 year-old tradition for our species, older than any other tradition, and that’s pleasurable, getting good at storytelling.
I feel that many people don’t talk about their failures right now. It’s not like failure only happened a long time ago and then you solve it and then everything’s good after that. Failure is unpredictable. Bad things happen every day. It’s just a matter of being honest about them.
Scott: What is the secret to doing what you love?
James: It’s difficult, because there may be many things that you love doing, and there’s many things that you haven’t done yet that you will love once you do them. The key is staying healthy, being around friends, and writing down ideas every day. Pick a thing to write a list about. This is how this started for me.
I’ve always loved games, but I’m not going to be a professional Monopoly player, or even a professional chess player. But I started thinking, what’s a list of games where I could come up with tips for how to beat everybody?
For each game, there’s tricks. In Monopoly, if you own the orange properties you’re going to beat everybody who doesn’t know that trick, because jail is the most popular spot and seven is the most popular dice roll, so people end up on the orange properties more than any other property and pay you rent. I could write a book about this. I never did, but I started writing down ideas for things I could do.
Most of the time they were bad ideas, like that book idea. But once in awhile you say, “Wow, that’s exciting.” You wouldn’t have thought of it if you weren’t writing down this list of ideas. I’ve started entire successful businesses just coming off a list like that.
Think about what you loved as a kid. I loved games, for instance. As an adult, you can’t be a professional at it, but you could write a book about it, or a blog, or do a podcast. Interests you had when you were 14 or 10 or 6, they aged in different ways. You might have aged apart.
Scott: I thought that was the case until I got the PlayStation 4 VR. I feel like a kid again.
James: Imagine all the blogs out there with the Easter eggs or cheats in the different games. You can send out a newsletter to your friends who play PlayStation 4. “Here’s all the websites for the cheats for these different games.” Then more people subscribe to that; suddenly you have a 10,000 person letter and PlayStation sponsors it. That’s how your interest might age in a professional way. As opposed to, “I’m going to be a professional gamer.”
Scott: [How do you] tie this to this idea of choosing yourself?
James: In that case, say you send out an e-mail to four friends. You say, “Here are all the hidden blogs with the latest cheats.” They get their friends to sign up and then suddenly you have a big list, 10,000 people. You have a little media company now—you could get advertisers, do a podcast, interview the designers of the games. Suddenly you’ve chosen yourself to be one of the world’s experts on aggregating information about some specific games for PlayStation.
“Even with pre-defined paths, the gatekeepers are breaking down.”
You chose yourself. PlayStation didn’t have to pick you. A tournament didn’t have to pick you. You didn’t have to be in some ranking. You just did it.
Scott: There also wasn’t any pre-designed path.
James: Even with pre-defined paths, the gatekeepers are breaking down. Take a basic example: publishing a book. If you want to go the traditional route, you need people to like you: an editorial assistant, an agent, an editor, a marketing department, a publisher, a bookstore purchaser. All those people have to like you for your book to get published—or you could upload your book to Amazon.
The best selling book in history now, Fifty Shades of Grey, was initially self-published. E.L. James uploaded Fifty Shades of Grey to Amazon, sold about 250,000 copies, and then Random House picked it up. She sold 200 million more copies of her series, more than all the Harry Potter novels combined. She chose herself.
Scott: There’s another aspect of “choosing yourself” I really like: you choose yourself because someone else is going to probably do it for you, and you’re probably not going to like it.
James: Take any employee situation: your dream is to keep getting promoted until you have a nice retirement nest egg or become the CEO. Every step of the way, you have to cater to the agenda of someone else, your boss and their boss and their boss. That’s very stressful. It’s hard enough to cater to my own agenda.
Even when you start a business, you have to cater to the agendas of your customers, your investors, your partners, and your employees. At least in that case you choose all those groups and the business you’re going to be in. I’m not even recommending being an entrepreneur. There’s many ways to work for yourself: an author, or an academic with tenure.
Failure is going to come, also. If you’re trying to do everything on your own, there’s a lot more opportunities to fail, but you can also bounce back because you can have variety in what you’re doing. Variety helps to buffer economic failures.
Scott: I have some days where I feel like everything has bombed.
James: I have days like that too. I had a day like that yesterday. It happens. You have to almost lean into the problem.
Scott: What happened yesterday?
James: I was feeling stuck on writing and on getting guests for my podcast. I’m an angel investor, so I’m invested in a bunch of companies and I’ve not gotten any updates from any of these companies in a long time, which is usually good news. Normally I would think, “If you don’t hear anything, that’s good.” I was thinking, “What if it all didn’t work out, simultaneously?” I started to go down that downward spiral.
Scott: Once you start spiraling down it sucks in everything. The reverse, the upward spiral, can have the opposite effect.
James: You’ve got to be careful with both. Both of them are hot potatoes.
Scott: Optimism can be dangerous?
James: Yeah. That’s how I contributed to going broke. I thought, “I sold my business, I’m done with improving as a human being, now I can do whatever I want.” That begins that upward spiral of optimism. It’s not manic; it’s very situational.
You can’t moderate situational ups and downs with medication, you have to know how to recognize them, stop yourself, and have habits in place to take care of yourself.
“When you do a science experiment, you expect that many experiments won’t work out. That’s how ultimately you make big scientific discoveries.”
Scott: You’re also an amateur futurist. You’ve talked about how we will have more of an employee-free society, there’ll be a rising wave of solo entrepreneurs and lifestyle entrepreneurs. What is a lifestyle entrepreneur?
James: A very basic example: a personal trainer at the gym is a lifestyle entrepreneur. They work for themselves.
Scott: An Uber employee?
James: If you’re an Uber driver you’re a lifestyle entrepreneur. The word ‘entrepreneur‘ is not necessarily correct, but you’re doing your own thing and you’ve limited the number of people you’re reporting to. You could be an Uber driver but also renting an Airbnb, selling stuff on Etsy, buying things in China and selling them on Amazon, and writing a book. Maybe there’s a variety of things you’re working on.
Scott: I like this quote from you: “Creating new income sources is like sex—you only get good by doing it, preferably a lot.” Is failure an inherent part of that?
James: Yeah. When you do a science experiment, you expect that many experiments won’t work out. That’s how ultimately you make big scientific discoveries—the classic story of Thomas Edison trying a thousand different filaments before he had the right one for a light bulb. Did he fail those thousand times? Did he give up? No. He got better at figuring out what elements the filament needed to be made out of. He narrowed in on success. That’s what happens as you learn the language of entrepreneurship and making an income. You learn to speak it better and better.