Escaping the Zero-Sum Economy: A New Model for Local Prosperity | Zita Cobb

Speaker A: How do we use money? So we use the money to create the economic assets that would be economic engines that could support other things to grow on this, uh, support the intrinsic assets of the islands. And, and we learned about, I didn't, certainly didn't learn it in my career. Something called asset based community development. And the questions of that are, ah, simple and beautiful. What do we have? What do we know, what do we love? What do we miss? And what can we do about it?

Speaker B: Welcome back to the Eric Ries Show. Today I'm talking with someone whose life story feels like it spans centuries, literally. Zita Cobb grew up on Fogo Island, a remote fishing community far away from far away where money barely existed and fish served as both food and currency. When industrial fishing came to this remote part of Canada, her father sensed something was wrong. He gave her this warning. You have to figure out how this money thing works, otherwise it will eat everything we love. Imagine hearing those words as a teenager and being sent far from the only home you'd ever known. Thrust from a 19th century existence into the harsh realities of 20th century financialization, Zita took that advice farther than anyone could have imagined.

Speaker C: She turned out to be pretty good

Speaker B: at the money thing. She became a fiber optic tech executive and rode the telecom boom, leaving that bubble with both wealth and clarity about what markets get wrong. She eventually returned home to rebuild Fogo Island's economy on entirely different principles. In our conversation, we unpack the core question that shaped her life's work. How do you use money without letting it destroy what you value most? And we dig into the creation of the Shore Fast foundation and the now iconic Fogo Island Inn, a radical model of community owned business designed to strengthen culture rather than extract from it. This is a conversation about dignity, intrinsic value, community, and the possibility of building an economy that serves people and place instead of the reverse. Please enjoy this conversation with Zita Kappa.

Speaker C: Well, Zita, thank you very much for taking the time to have this conversation.

Speaker A: Eric, thank you.

Speaker C: I find your story really quite fascinating. And you know, I've heard you tell it a few times now, but I thought if you wouldn't mind, we could start with your father and the advice that he gave you when you first realized you were going to have to make a trek into the wider world. Do you mind picking up the story there?

Speaker A: Yes. I think he nudged me into the wider world a little sooner than, uh, at least to think about it. Sooner than I would have ordinarily because I was about 10 when the inshore fishery that we were a part of collapsed as a result of the industrialization of the fishery and I grew up in a uh, as an 8th generation Fogo Islander families that were very involved in the inshore fishery and when it collapsed he said when you grow up you have to go away and you have to figure out how this money thing works because otherwise it will eat everything. We uh, love

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Speaker C: That's such a poignant quote that money will eat everything that we love. And I wonder if you can help for readers that are not familiar with Togo island and with your story. Like help us set the context for what it was like. I've heard you describe it as almost like you grew up in the 19th century. Like growing up in a context really without money. I feel like maybe one of the last groups of people in the world who have this kind of outsider's perspective on our hyper financialized world. So set the scene for us. What was it like to grow up in that environment? And when did money enter into uh, your life?

Speaker A: You know, I'm 67 years old, not 167 years old. Or 267. But I, uh, sometimes feel like I really have lived in three centuries because I grew up in the 19th century on an island, as we say, far away from far away. And the island of Fogo island is a part of the province of Newfoundland and Labrador, which didn't join Canada until 1949 to give you a sense and, and spent a time as an independent country with its own currency and its own stamps. And even being on Fogo Island, I don't know that we actually felt like we were part of Newfoundland either, because we were, it was like a ship in the, in the Atlantic. And we had lived here as people of European descent for 400 years. And money, I mean, we never talked about money. We talked about fish. Now fish was kind of food and currency because we were salt fish people. And we traded our fish with a, uh, merchant whose boat came at the end of the fishing season for the things we couldn't otherwise produce or hunt or fish or forage. And so there was trade, but it wasn't money. We didn't have bank accounts and my father didn't get cash for his fish. So we never, we understood that there was relative value of things and we certainly understood that we didn't have a lot of negotiating power when the time came to say, what does the fish go. Going to fetch this year? And so, and my father, he, he lived in ah, a kind of pre banking, pre money world. And when the inshore fishery collapsed because the 20th century arrived and the industrialization of the fishery came, but seemed to us overnight, but it wasn't overnight, it was just making its way to us. I mean it took practically no time at all to take just about every last fish in the water as we watched this happening. And so he uh, he used to question what kind of logic, like it makes no sense to fish day and night until all the fish are gone. And so he arrived at the conclusion that they must be turning the fish into money. There's no other explanation. And I think he understood for his children, and I was the second youngest, that this money thing really was going to just keep coming and coming and we would be victims all the time of it. And so I went away and um, studied business and I figured out a few things about how this money thing works. And to my great surprise, I fell in love with business and that I didn't expect that. And I think in the last, my career was in weight division, multiplexing the little optical components that enable the digital age and, and yeah, fiber optics, right? Yes, exactly. And so there's the 21st century. So those are. There you go. That's, that's three centuries. And I think the centuries are going by in decades now. So maybe I've actually lived in four centuries at the age of 67. But it, I think it was. I mean, geography is everything. I think geography is the most important thing. And it, all of this was because of where, where I was born and raised.

Speaker C: Yeah. Tell me a little bit about the history of Fogo island and in particular how your father and the people that live there in this kind of pre modern state, like, you know, how did they conceive of it? Because this is such an, it's such an interesting story to me because we normally think of these encounters between kind, uh, of Western capitalism and indigenous tribes or people who have a very different lineage. But here this is not a story of colonization or at least, you know, the colonies already had taken place. These are, um, settlers of European descent, but now themselves isolated from the mainstream of Canada.

Speaker A: Like, what was that like, exactly? It's a. I mean, I think when we talk about knowledge, local knowledge, cultural knowledge, Indigenous knowledge comes from an enduring, lasting relationship with a place. And that happens, I mean, doesn't happen so much in modern times because, you know, we somehow have fallen in love with the idea of mobility, which as just some kind of a, uh, you know, a Holy grail kind of state of being, which I don't, I don't think is necessarily, uh, the Holy grail. But the people that I am descended, um, from arrived. Started arriving here in the 1600s from England and Ireland and made a living fishing in the inshore fishery. Fishing, uh, for cod. I need to be clear. I mean, there were other species, but really all we cared about was cod. And means so much so that when we say fish, we mean cod. We don't mean anything else. If I want to say mackerel, I'll say mackerel, but I won't say mackerel. And we were sealing people because it's the northeast coast of Newfoundland, it's in the Labrador current. And so every year half of Greenland breaks off and comes down on top of us, and with it come 6 million seals. So we were sealing people. That was a very important food staple for us as well. And so that enduring century after century, generation after generation gives rise to a way of knowing and knowledge that, yeah, it's a settler community for sure. There were indigenous people that called the Beothic that were here on this island that came out in the summer and fished and went back into the central part of Newfoundland for the winter. And that culture has been erased from the earth through the encounters with the Europeans that arrived. You know that, that is one of the great tragedies of Canada, of Newfoundland in particular.

Speaker C: Yeah, yeah. Um, and I want to really understand, like, can you walk us through like, you know your, your biography is really interesting because you had this very local, very land centered, fish centered, cod centered childhood. And then you entered into the world of business. Your father sent you away to learn about money. So, so what was that like? Like walk us through the first steps of that. Like, well, where did you go? And what were the first, what uh, are the first things that you encountered? And just. Yeah. What was, what was it like to be thrust all of a sudden into the 20th century?

Speaker A: You know, it was. I went away once before, which wasn't uh, a good going away. I mean I never had a childhood illness.

Speaker C: Right.

Speaker A: Yes, I had tuberculosis when I was five and that got discovered because the government of Newfoundland understood there was an outbreak of tuberculosis in these small coastal communities of Newfoundland. And uh, a, uh, charity I think was called the Christmas Seal that had. They got a boat and this boat had X ray equipment and it came around to all the little communities and people lined up on the dock and this was like, like a big deal. We didn't really know what it was all about. And they just did chest X rays. Not all TB is in people's lungs, but that's uh, mostly it is. And that's how it was discovered that I had tuberculosis. So I went away for a year as a, uh, between five and a half and six and a half. So I had a sense of away. I was away in Newfoundland, but I, but this away feeling, I didn't really. It's a terrible thing. It's a terrible thing for a five and a half year old, six and a half year old. I never saw my family, uh, entirely. I never saw them for a whole year M. I mean it was not possible for them to go there. It was really far. And, and also at that time I don't think it was really well understood that how to manage tv. And the last thing they wanted was people coming to visit in TB sanatoriums. So.

Speaker C: Right.

Speaker A: We're trying to control. So. And that's the other thing about these uh, three centuries I've lived in now. I've lived through two pandemics because it was a pandemic. It wasn't a pandemic, it wasn't global pandemic. But it was for outport Newfoundland, you know, a very dangerous time. Anyway, but going to. I went to Ottawa, which is, uh, um, center of central Canada and the capital of Canada, because, um, I'm the second last of seven children and one of my. My oldest brother lived in Ottawa and so he really helped facilitate how I could ever get from Fogo island to Ottawa. And to arrive at and discover an escalator or to discover in every room there was a light switch. I mean we got electricity in 1971 and I left in 1975 on the 10th of July, and I turned 17 on the 16th of July. So I was super young to be starting university and, and certainly my oldest brother and his family cushioned the arrival into this, uh, you know, how to take a bus and traffic lights and freezers and like, I mean I just, it's. It. Everything was new, was. It's a really great thing because I, I think it has continued my obsession with objects and how things work and why do we have this like, not. I just don't look at everything from first principles because we didn't have all of those things. But my goodness, we still had a good life and it's just all these things. So it, yeah, it was noisy world and uh, a busy world to arrive into and then to arrive at a university with thousands of students. Totally overwhelming. Yeah, totally overwhelming. But sort of in a way it was a bit like arriving in a sanatorium with a lot of kids all jammed into the same war. Just like, you just got to hold your focus.

Speaker C: Yeah.

Speaker A: And I think that's something that I learned. I learned it, had to learn it again, hold your focus.

Speaker C: What about the educational side? Like, what was that culture clash like? You know, did you feel prepared to be in a university? Like, had you.

Speaker A: I mean, the first hurdle to overcome, and you don't hear it in my voice now, but we have a very particular regional accent here. And so it was challenging because I wasn't understood, uh, because of the accent. And it took a long time for me to realize I have to like, figure out how to lose some of this accent. I was intimidated by the fact that I only had grade 11 and I was 17 and I was coming to an Ontario university where they had grade 13 and so they were two years older than me. But what I discovered very quickly is the standard of education in Newfoundland in this little school on an island, off an island, because it's provincial standards, was every bit as good as the big province and the big university. So it didn't take Me very long to realize. No, no, I got this material. I mean I had calculus, you know, going into university and I don't think those kids had calculus. So once I realized I was on solid academic footing, it made the rest pretty good.

Speaker C: And what was that like? Was education a big value in the community where you came from? Like what accounts for that?

Speaker A: Not at all. Not at ah, all.

Speaker C: So how did you get such a good education in, at the primary level?

Speaker A: Yeah, it was because it was a provincial program. Education was provincially regulated. We had to write province wide exams. Even on Fogo Island. Absolutely. We got a new high school in and I was among the. When it opened, I went there that year for grade nine and it was the first high school uh, in the province, in the whole province that was integrated, meaning all the religions together. Because we were very separated along religious lines, meaning Catholics and Protestants. I mean there were no Jewish people or Muslim people or Buddhist people, but we were. Those English Irish histories were alive and well around Catholic Protestant lines. But the new high school got incredible teachers that came from like some of my teachers. This was the really great thing. Uh, I had a teacher from Kenya. He was the most amazing science teacher. He changed all of us in the way we thought about the world and the creatures in it and biology. We had a math teacher who grew up here. Uh, he was I think the best math teacher that ever there was. So we were great teachers and we took it seriously. And I also think because of the collapse of the inshore fishery, like my parents couldn't read. But school was, suddenly became very important, which is why they pushed and shoved along with the other families to get a better high school and to put us all together so we'd have a better chance of better teachers. Because they understood we were probably not going to be making a living in little boats on the North Atlantic, that they had to prepare us for the bigger world.

Speaker C: So what I want to really understand is what was like, like what was your perception of like what, what we would call community in, in a university setting or a modern setting. Like you, you come into this, uh, you know, come to Ottawa, you come into the modern world with this outsider's perspective. Like what did you, what did you observe? Like what, what was your sense of how people were living and how it was different than what you were used to.

Speaker A: It was super disorienting to understand like how do people make a living here? And, and where does the food come from? And I mean it's. Ottawa at that time probably had half a million People, I guess. And, and you know, the idea of grocery stores and everything is in the store. So it made me a, uh, kind of automatically a systems thinker because. And that's the obsession I have with objects like, how did that zucchini get here? And, oh, it came on a truck. Where did it come from? And who grew it? So this constant trying, trying to assemble an understanding of how a place works and then how do the people there, uh, hang together? And for sure, I understood pretty quickly, okay, this is just too big a place to be a community and the neighborhoods are a community. And that works at that neighborhood scale. Except that I once lived in a neighborhood that didn't have a place to get food. And so I was like, what kind of a place is this? And it was a suburb that, uh, my brother lived out in the suburbs like this. That felt super weird not to have the things you need near. And then I, when I moved, you know, as I moved on, I didn't stay very long in the suburb. Then I started to look at how neighborhoods work and how, when do you have to cross into another neighborhood? And then you start to understand. And I think that's the question of, the biggest question is how does the part belong to the whole and how does Fogo island belong to the world? We didn't know how we belong to the world, which is why people, we, um, we got sideswiped and the carpet sort of was pulled out from under us.

Speaker C: Right?

Speaker A: We didn't understand the world, so we couldn't understand how we were a part of it. So how does the neighborhood belong to the world? How do I belong to the world and to my family and more broadly? So I think that's the, uh, the thing that is so interesting to me is all the connective tissue. And in a city it's, you like, it's hard to discern how the connective tissue works.

Speaker C: So walk me through how you wound up in fiber optics from there.

Speaker A: I graduated with a business degree from Carleton University in 1979. And uh, a friend from university and I decided, well, we really want to see this country and this giant country. I mean, when I left home, uh, the people from Fogo island said, oh, you're going up to Canada. Because remember, we joined Canada in 1949. I was born in 1958. So people of my parents generation had no concept of Canada. Uh, they barely had a concept of Newfoundland and Labrador. So we bought this used Ontario Hydro falling apart van and spent six months going to see Canada. And the van broke down Just outside of Calgary. And Calgary at the time, this is 1980, sorry, 1979 was boomtown. Oil and gas was absolutely booming and you know, is about to start into the big exploration in the Beaufort Sea and and so you just had to be alive to get a job. That was it. And so I started working for Texaco which used to be called the ugly Sister in production accounting. And then it was such a boom town and a boom time that you could go for a walk at lunchtime and not come back to work because you got offered a different job and they wanted you to start right away. Right away meant like right now, you know, just don't even go back after lunch. And so it was, it was, it was super crazy. So I moved to Shell after a short time and uh, then I realized I'm not going to survive here. I mean I couldn't be inside these giant buildings in these giant systems. Although I have to say I did love the fact that I used to do the first level close for the financial statements at Shell and I would have to send them to the Hague. Uh, I'd be there at night sending financial statements to the Hague. That's like another part of the connective tissue like that. I, I really loved that uh, because it helped it orient how we belonged into the big Shell system anyway. But, but these sort of monster organizations weren't, were not. I knew I wouldn't last and so I did. I joined a very small tech company that was focused on cold regions engineering and coal regions design that had been started by two people, two men who came out of the US Coast Guard and super smart, super lovely, very technology focused people. And then I realized when I joined there, this is what I want to do. I want to support people who are making things happen. And they were really pushing the, the boundaries of technical knowledge around cold regions technology and what, what could be known with numerical modeling because that was all really starting then and, but could be known working at model scale. They had invented a kind of a synthetic ice so we could test icebreakers in, in ice conditions. And we actually had a wave testing tank in Escondido, California and we were testing ships in wave conditions at model scale. And that, that became something else because then we started testing all of the America's cup ships, all the sailing ships.

Speaker C: And I remember reading about that.

Speaker A: Yeah, yeah. Like it was such a, it's a beautiful company. It still exists actually. And it was like a little mini conglomerate that had offices all around North America. So I spent time in Houston, I spent Time in Columbia, Maryland and we had two offices in Canada. It was a super beautiful time of working in a privately held company with colleagues that were, were constantly solving problems for the world. So we under advancing our knowledge and I really loved that. It was a decade, I loved it. I was always on yeah my m career has always been I will do everything that needs to be done to enable the technical people to do like to create uh, the enabling conditions for them to be successful. So yes, finance, yes hr yes it, yes purchasing like whatever these, whatever this is, the systems of support I need it to be. And um, and then that company went through a big transition actually it is a fascinating thing. The man's passed away now uh, but he invented I think the first autonomous mobile personal robot in the 80s, late 80s. And I will never. This was a great lesson uh because we were taking money from our other businesses or other, other businesses like the one in Houston or the one in Calgary or wherever to keep investing in this robot development. And it, it really was a pioneering thing and he was super smart guy and making a decision to stop funding it because it just didn't look like it was going to take us all down was the hardest thing to be in the middle of that. And I remember we would go into meetings to present it and I remember this guy asking, looking at this thing and it was like tall, it was like three feet tall. And it, it could monitor its battery levels and move around the house and, and when its battery was low it would go sit on its battery. And I was like super impressive. And this man said who was going to be a potential partner? He said but what does it do? And then we, and then we talk about all the features, uh, and then we say but oh it has, it has a built in clock. And you know, so he said well

Speaker C: what is it for?

Speaker A: Like I don't need a clock. But what does it? We could never answer the question was is do. And, and so realizing that it's just a demonstration of what's possible with technology but we have to sell these things to make a living. So anyway, that was a painful time because I, for close colleagues, technical colleagues that were trying to make something happen to be in the finance seat to say no, no, uh, we just can't fund this. And we couldn't. I mean this is before the time of venture capital wasn't the thing. You know, I was going down to the bank of Baltimore to explain our ever decreasing amount of cash and a growing debt and looking at this robot and having this what does it do question? Anyway, so that company, it's, it still exists as I said, it's changed names a few times and. But uh, still exists and still doing cold regions and marine technology. So of course the Arctic is not what the Arctic was even then. Like in my lifetime. Less ice in the Arctic. Then I joined JDS, what was then JDS Optics in 1989 and we were 90 people in Ottawa and the company was founded by people who came out of um, Nor Bell Northern Research. It was growing. We, we were a manufacturing company. We weren't a software company. I mean we were a technology company but not in the information. Like we were making little optical attenuators and switches and it was for the

Speaker C: physical side of the telephone.

Speaker A: It was a manufacturing company basically with a lot of smart scientists and they were engineering physicists and physicists and, and, and um, wave division multiplexing was at its early days really and they were, we were development people with some basic research, uh, capacity especially in the, in the lenses and the coating of lenses uh, for fiber optics use. And it grew and grew and grew and grew and then, and then all of a sudden the, you know, of course the telecom, I think it was 19, mid-90s, the deregulation came. I think AT&T was broke up in the 80s but a lot of new entrants coming in. And of course people were starting to realize the Internet was bec. A real thing. And the build out was, became like relentless and we were the bottleneck because we were making all the little optical components. And so we uh.

Speaker C: The telecom bubble.

Speaker A: Yeah, uh, yeah, we were very much in that bubble. And so we, we wanted to get access to more technology than we could possibly grow ourselves. So we sold half of ourselves to a company called Furukawa Electric, a giant Japanese industrial and that realized after a very short time that this wasn't going to work. You can't take a little tiny nimble company in Canada and be half owned by a giant Japanese conglomerate. And you know, uh, we thought we would get access to technology, but how? I mean just to even visit a lab takes, you know, weeks and weeks. And so anyway we, so we decided to go public um, on that. We went public on the Toronto Stock Exchange and that diluted Furukawa of course and gave us some money to then start to buy companies. So we started buying companies and we were public and I have to say I did not like being a public company and we, and uh, we kept buying companies and, and the industry just became, it was like being swept up In a giant tsunami. Honestly, I barely remember what happened between 1996 when we went public and 1999 when we emerged in one of the. At the time it sounds like, uh, nothing amount of money. Now people spend that on one little building called the data center. Less, way more than that. It was an $18 billion merger between JDS Vital, the Canadian company, and we were involved in passive optics optical devices and Uniface Corporation based in San Jose, which was an active devices company to make JDs uniface. That was in 1999. And of course we were all scrambling to build, build, build, build, build. And I signed a two year contract when we merged in 99 to stay for an additional two years. I didn't become CFO of the merged entity. Um, my job then was to go buy more companies. I bought like 40 companies in two years. And um, and then of course it all came crashing down. I left in April of 2001, but it had really started to decline by the time I was finished.

Speaker C: You had actually very good timing, really,

Speaker A: in retrospect, which, I mean, I didn't really. It was fixed like I gave the uh, two years and that was the two year point. Uh, so yes, it turned out to be good timing, but it wasn't any good guessing on my part. It's just the way the cookie crumbled

Speaker C: because people are talking about the AI bubble right now. And it reminds me a lot of the telecom bubble because when I speak with students now, I always get asked, is it a transformative technology or is it an overhyped bubble? I always ask people, why not both, you know, why does it have to be one or the other? Telecom bubble was extraordinarily destructive and ludicrous and also laid the foundation for so much of the modern world which turned out to be very productive, even though many people involved, um, uh, lost a lot of money. So. Well, just, just give us a bit of a sense of the, of the rise and fall of the telecom bubble. What was it like to be on the ground floor of that?

Speaker A: You know, it's like being, it really is like being swept up. And so it's disorienting. And I think, I mean hindsight, in hindsight we were really not looking forward. We weren't. And I, with m. My colleagues, we often talk about this now. It's like why, why did we not see that there was no business model under, underneath? I mean we were an input to a systems company who was selling to the service providers. And it was, they were all scrambling to build out and we were a huge bottleneck. And so we were just trying to respond to like, they want more devices, they want this, they want that. And why did, why did we not question the business models of our customers? Why did we not see, why did no one see this? Because we assumed that people were willing to pay for information. We're barely ready to pay for information now, and now it's 25 years later.

Speaker C: Yeah.

Speaker A: So it, we didn't see it. And I, I consider that a, uh, you know, a failure on all of us. And you know, there's a certain kind of frenzy of, you don't want to be the one that's left out of this. Like, you got to that, uh, going

Speaker C: on all the time right now. Nobody wants to be left out.

Speaker A: Well, that's it. If you don't stay at the crest of that wave, you're going to be swept under and that's it. And somebody's going to win and it's not going to be you. And, and, and you think, my God, I mean, at one point JDS Uniface had 40,000 employees. Like that's an enormous responsibility. Right. And you know, and companies all over the world. I mean, I remember buying a company in Germany and promising these people that their technology is going to endure and, and will be, will, will last, and making them other promises such as we would keep the company there, which ultimately we didn't. Um, so I think it came with a lot of obligations that we felt the uh, which in a private company you had more control. And I didn't enjoy being, I have to say, in something that was moving so fast because I don't think anybody makes good decisions when things are moving so fast.

Speaker C: Yeah, yeah.

Speaker A: And, and why did it have to move so fast? Like, why couldn't, why couldn't we have collectively said, let's have a breath here. Why can't we do that now? Um, I mean, and I don't know, it just becomes this weird zero sum game thinking and then everybody's making bad decisions. Yeah, I think that's what, during that time, I think we were all making bad decisions.

Speaker C: Collective becomes a collective delusion. I mean, I guess we're seeing, we're seeing that, that happen again now. And I think I wanted to ask you about this because I think it's actually a really interesting contrast with what you're doing with Shortcast. You know, here you have an example of a very traditional corporate governance structure of a publicly traded company swept up in this mania. And people, I think in our world that we have this kind of like default assumption that that's good, you know, that's, that's efficient. That's how you create value, that's how you make profit, that's how you create shareholder value or whatever, you know, whatever the language we use for it. And then we kind of treat these manias and um, collapses and the broken promises. And I can imagine what it's like to be swept up in that stuff. I've been there too. We kind of view the collateral damage of that as almost like a bug or like a side effect. But, uh, it's happening so much that it's like become the main effect. It's basically like affecting every public company that gets swept up in these things. And I'm hearing stories now about company after company or company that is just going all in for A.I. oh, you know, really doing crazy stuff with their work. As someone just told me a story that they've been told. So the programmers that their whole division has been told, there's like, they're installing monitoring software and if you have, if you're not 30% of your code or more is not written by AI, you know, you're in trouble. You're going to be called in for like a performance evaluation. And it's just like, it's just wild. And this person was explaining to me like they feel like the emperor has no clothes, but they can't say it out loud at work because they would be, you know, be in big trouble. And I was like, well, if you consider the possibility that everyone else feels the same way and none of you can say what you actually think is going on, it's like that we get these effects anyway. Um, that's considered best practice to drive ourselves into these wild situations. So, you know, I don't want to get ahead of ourselves, but, you know, you had this experience. You got to go through one of these bubbles and you were one of the lucky people whose timing was such that you came out with a lot of wealth.

Speaker A: From that experience when I was in it, did I feel that we could have done anything different? I mean, that's the other question. I do think if we were, were, uh, if we had remained, uh, a privately held company, I think we could have done more. Uh, I mean, what I learned from this, I do not trust the market. I don't trust markets in that way at all because they will drive us in this sense of a zero sum game. And I. And you will lose track of what are, uh, what is it we're trying to do and who are we doing it for?

Speaker C: Yeah. What is the purpose of it?

Speaker A: Right. And to push the technology. Absolutely. Absolutely. And I think if we didn't have all this money rushing in, which, you know, money just rushed in like crazy to build out all this infrastructure and a lot of it was debt. And, you know, we were just building this. I mean, we didn't have that debt because we were at the bottom end of it. We were just supplying. We were just selling little widgets to into it. Um, but of course our customers went away so that, that, uh, because it was all. All for nothing. Now, if you look at it 25 years later, I don't know if all that fiber is used, but probably it is. All those systems, I mean, it wasn't lit for a long time because there was no need, but now it probably is and it takes 25 years. And maybe that's the same as what's going to happen with this. We're just, you know, it's the combination of two things. Um, absolutely. The, the scientific or technical curiosity and natural human instinct to push it, to like, oh, we could get it to do this and that and that. That is, that's a wonderful thing. Uh, what makes it not so wonderful is when it becomes fueled by money and the seeking of as much profit as possible as soon as possible, then we lose our footing and we're out skating on ice with no brakes. And I think that. And then a huge wind pushing you. So I don't know how to. I didn't know how to make it stop then, and I'm not sure I know how to make it stop now.

Speaker C: Did you ever get a chance to talk about this stuff with your father?

Speaker A: No, he passed away, uh, before I joined jds. He passed away when I was still, um, working in the. And was I still in the oil patch? No, I was working for ArcTech, the cold regions technology company. He did see my career start in technology. He absolutely did.

Speaker C: Did you go back to Fogo island during that time?

Speaker A: Uh, always for visits. Visits, absolutely.

Speaker B: Yeah.

Speaker A: Uh, I mean, I've never lost touch with here. Ah, very orienting. I could never. I never did find the heart to tell him what my salary was. Ever.

Speaker C: Right.

Speaker A: I did his tax return when the government. There was a funny time that the government of Canada figured out that all these fishermen in this remote places weren't filing tax returns. And so these packages came and I think I was 8 then. And he, uh, he got this. And the postmaster was, was someone who could read in the community. So, like, you got to fill this out, you got to send it in for the government. And so I took it out and I could read and I filled out my father's tax return. He got $800 back. It was the craziest thing because he had all these kids and the basic personal exemption and was like, wow. Anyway, so. Yeah, yeah. So then I was doing tax returns for other people as a child.

Speaker C: Oh yeah. How can I get, can I get my 800 also?

Speaker A: Yes. Everybody's like, wow, everyone's going to get money back from the government. This is a great thing. So I didn't have the hur. Tell him my salary in those years.

Speaker C: Yeah, yeah, yeah. But did he feel like you had fulfilled his commandment? Like did, did, did he. Was he satisfied that you had come to understand money?

Speaker A: Yes, he did. I think he felt very satisfied that he, that I was not going to be swept away in the way he had been. And he, but he, my, my m. My mother was still, uh, living then too. They actually moved away from the island because he'd had a heart attack and he was no longer like. Fishery collapsed and all of my brothers were in Toronto and so my mother wanted to go where the grandkids were and the brothers were. So he moved away. It was a very bad thing for. We were talking about what it's like for me as a 16 year old to go to Ottawa. Can you imagine him, he was in his late 60s, not being able to read, going to Toronto. I mean we might as well have sent the man to the moon. It was like, uh, really hard. Um, anyway, so he uh, so he wasn't on the island. I think he probably by the time he passed away had pretty much given up that the island wasn't going to make it.

Speaker C: Yeah, there must have been a big population collapse. The collapse.

Speaker A: Oh yeah, absolutely. A big, huge, uh, collapse. And it may. Was still something we struggle with. But yes, I think he, I think he felt that he had done everything he could could do and certainly his generation did a lot in what's been called now the focal process, which is they started a cooperative, they adapted to other species when the cod. So they, they adapted to crab and shrimp. So there's been a lot of adaptation happening here. And that little co op that they formed in the late 60s is still one of the most important fisheries in the whole province of Newfoundland, Labrador and they export to all over the world. So you know, there's a success story there. But the fishery that they managed to adapt to is less labor intensive than it used to be, um, so fewer people needed in it, but still, we are a fishing community, and that's a credit to his generation.

Speaker C: I think another fascinating part of your story is that you went back to Fogo island after, you know, having a level of success in the modern world that. I know a lot of people who, once they have that success, they consider themselves to be kind of cosmopolitan citizens and they. They want to travel the world. They want to be. They want to be anywhere but where they grew up and enjoy being part of this kind of like, global elite. I. That would have been a very natural thing for you to do, and you must know many people who made that choice. Why did you go back to the island?

Speaker A: Well, when I left my career, I left in April of 2001, and I, uh, had a rental. Big rental truck that contained a little. Little dinghy. And I drove to Florida to get aboard a boat that had been built in the previous two years, which I had asked to be built by a lovely company based in Bradenton, Florida. And the plan was to go sailing, which is exactly what I did. So I spent five years on the boat sailing. And it, you know, I came out of my career, as you said, with more money than I needed for a lifetime. And I, um, have. I have a funny relationship with money for all the reasons that we've talked about. I don't trust it. I do not trust it. And, you know, I think it's. We shouldn't let it land on us too much because I think it becomes debilitating to people. And, um, just pick up a newspaper

Speaker C: if you want to see evidence of this fact.

Speaker A: Yes. And I think. I don't think it empowers people at all. I mean, I think I grew up at a time that people in my parents. Generation had a deep sense of dignity and confidence that comes from a sense of competence and agency. Uh, you know, they were. You would look at their lives and think, wow, that must have been hard. I mean, it wasn't easy, but they didn't suffer from anxiety.

Speaker C: Right.

Speaker A: They felt that they understood the context they were working within and that they could navigate it. They also understood, well, we're probably not going to live that long. It's okay, we're going to die. And that's. That's so. That's just fine. And so. But there's something about money that actually people, you know, it's. It's a substitute for power, but it's. It's not a substitute for competence or, uh.

Speaker C: No. And for the very reason that you Mentioned that it has this kind of mental illness effect on people that makes them actually like quite feeble.

Speaker A: Yes. And I saw that and I see it uh, a lot. Sailing, sailing was for me was a way to kind of make sense of what, of what this money was, not let it land on me. And you know, to, to live in a way that I tell you sailing is a terrifying experience and you are super focused on every single thing about that boat and that destination and that weather and what are you going to eat and things break and all of that was very real and just gave me a chance to leave the world. I was in, in fiber optics and in telecom and during that time I started a project, um, it was a radio education project in Rwanda and it was distributing solar powered wind up radios to child headed households post genocide and with post AIDS epidemic and post genocide. And that's when I started to really realize, think deep more deeply about community economic development because you know, you go to the middle of Rwanda, most of the people I was meeting had had no knowledge of the world or very little. And that's why the radio was super important. And, and this was shortwave radio. So it wasn't a radio that could be taken over by bad actors who are then going to cause a genocide because people could hear about the, all of the world. You could. And kids were starting to learn other languages because you were getting Deutsche Welle and you know, you're getting the BBC and you're getting whatever the French one is to going called. And anyway it was just giving people. This is the uh, sort of the thing that drives me I think is, is how do we give people in the places they live enough an opportunity for enough knowledge about the world that they can figure out how to participate in it themselves. How does their part belong to the whole. And that's what. And so in Rwanda I started to realize the script has been written for them by, by others. And that's you know, in many places in the global south that happens and all of that I say call it globalized. Do gooding has, has not uh, not always led to good outcomes certainly. Um, but it's necessary to move money somehow from the rich world to the less rich world which figuring out how local people actually set the table is the hard part. And so sailing. Anyway, so uh, while I was sailing I was doing that and home was, was no emergency here. We didn't have a genocide or an AIDS epidemic, but it was just slowly getting less. And I thought uh, well if I know how to, I mean I know about business. I know how to start companies. And I really believe that we can solve problems with businesses. And I. This is something I can do at home. And there's not a lot I could more do in Rwanda because I didn't understand the culture. And I think we need to be very careful messing around in other people's cultures. And so at home, I'd had a scholarship program that, as one woman said, you're just paying our kids to leave. Like, can't you do something to actually create economic activity or employment here? And so that led me to home. But there was a. I have to tell you, there was a time we bought a company in China and it was an assembly company. And I know those. That is those assembly environments because we had a lot of them in North America, and there are a lot of noxious chemicals involved. And we had clean room environments in North America. And in this case, it wasn't, uh, a clean room environment at all. In fact, the glues were barely covered in this vast open space. And we're getting a tour of this place. And I said to the fellow who was touring us around, like, people shouldn't be in this room. This is, like, dangerous to their health. And he said, they're country people. They don't mind.

Speaker C: Whoa.

Speaker A: I thought, I'm a country person. Doesn't matter. If you're a country person, you're a person. And so I started to realize, what am I? What this system that I am, um, enabling and supporting through my work. What are we doing? Who is it for? It's not for these people, clearly. So that was a part of the realization, like, I just, I need to do something else. And I'd already. I was already on the path of doing something else, but it affirmed it. And, uh, I slowly came home, I suppose is so it's a way to say it. And then I became very focused on this question of, for any place. We could have gone back to that place in China. For any place. How does that place belong to the whole. And what does business have to do with that? And how can we do business differently that supports more people in more places?

Speaker C: It's interesting to me that you. You refer to the island as home throughout this whole story. Is that how you thought about it during this time?

Speaker A: That.

Speaker C: That, that that's where home was, even though you had been.

Speaker A: Oh, yes. Oh, yes. I mean, like we tell. It is kind of a joke about Newfoundlanders. How can you tell? The Newfoundlander in heaven, she's the one moaning a groan and she wants to go home. We always want to go home.

Speaker C: Okay, so tell me about, tell me about the establishment of SureFast and in particular tell me about where the idea to. Well I guess to tell everybody about the inn and then how did the

Speaker A: idea for the income of that we started with. We first we started by setting up the registered charity of Canada called SureFast. And the goal was to put. I was working with two of my brothers in this undertaking at the time. Um, how do we put another leg on the economy? Because we still had a fishery which was essential but not sufficient to the future of the island. Because not every kid coming out of the high school is going to go into the fishery. They want to give more opportunities and economic opportunities and to do it in a way that strengthened the culture of the place and connected us into the world. So we're always back to the how do we belong to the world and how do we give our kids a chance to be a part of the world in a standing where they're standing and like our job in the present, all of our jobs, this is always the job is to mediate the relationship between the past and the future. And I really felt that that's what. So now I'm suddenly. What was I then when I came home I was close to 50, I wasn't a 10 year old. So it's 40 years later I figured out how money works and now my job is to help use it. Because money is not a bad thing inherently. How to use it in a way that doesn't eat everything we love. But how can we use it in a way that actually turns money into fish?

Speaker C: Mhm.

Speaker A: To reverse it. And so and I, and I think at the root of any conversation about money and business is you gotta start with what has value. And is there such a thing as intrinsic value? Well, I believe there's something called nature and culture which has intrinsic value. The things that have intrinsic value are the things that yes, support our physical and emotional and social lives. And we're meaning seeking creatures are part of meaning making. And if, and I mean I, I think we live in a time that there's a lot of nihilism in this world of ours. And I don't know the cure for nihilism, but because if we have convinced ourselves that really nothing has meaning and it's all for nothing, uh, that's a, that's a tough one, I think. I don't know if it's true that apathy comes before nihilism, but maybe it does. Maybe apathy is a stop along the road to nihilism. Um, and if it is, then empathy is the cure for apathy that we know. And empathy is only possible in physical, embodied form. And so how do we build communities that rest on economies? Because no economy, no community, that. That the fabric of the businesses that are there are built on a belief that there is such a thing as intrinsic value. And you are, as a business person, interacting, using money and interacting with intrinsic value all the time. And so are you make. Are you good? Are you supporting it, or are you destroying it? And so that's. We set out, uh, with all those questions.

Speaker C: One of the things I think is so fascinating about this story is because you start with. You start very much from the premise that money will eat everything that you love. Was there resistance or did you even have some fear about bringing the money economy?

Speaker A: Oh, yes.

Speaker C: Uh, I'd like you to talk more about how did you set this up in such a way that you would be confident that the influx of money would be used to serve the creation of this intrinsic value in the community that you cared about, versus being yet another way to strip mine it? Think about how many cultures have been overrun with tourism or where the ownership of the means of production, of the indigenous means of production is now owned by private equity or other kind of extractive owners. I feel like that could easily have been the story here. And sure, that crossed your mind.

Speaker A: M. It still does, Eric. I think about this every day. And because it's not just that money will arrive and gobble up everything, it's also that our young people are going to fall in love with it too. You know, it like, it's. It's just a dangerous element. And so how to make m sure we have our steady heads and steady feet to not be seduced by it, because, you know, an embodied, uh, kind of community life, you know, like, it's a pain in a way. Like, wouldn't you like to be that. That. That fella you see on Instagram that has this, you know, perfect life and he can do what he wants and he's got his private jet and he can be anywhere and he doesn't have to deal with the cranky ant and all the rest of it. Like, by the time you realize, by the time you become that guy, you. You don't know, it just looks so seductive. So I worry about all of that. Um, I think the most important thing I wasn't. I'm interested in ownership because I think the most important thing is who owns something, because the people or entities that, uh, own something determine the outcomes for everybody. And so we set this up so that it would be owned by Fogo Islanders because the charities mandate by law is the well being of this place. And so it's codified in that way. The businesses we started by building an inn and in is like, I mean in is such a beautiful thing. And inn is a platform that welcomes people to your community and in a way that you set the table. And that's an expression of culture. And of course that's what hospitality is. I mean, I, I don't think there's any such thing as corporate hospitality. I think there's, there's only cultural hospitality. Uh, you can't separate hospitality from a place. I mean, there's such a thing as service. Service is a different thing. And there are lots of giant hospitality establishments that offer great service. That's not hospitality. And we can talk about tourism m. Maybe separately, but when we were starting, how do we use money? So we use the money to create the economic assets that would be economic engines that could support other things to grow on this island, to support the intrinsic assets of the islands. And, and we learned about, I didn't, certainly didn't learn it in my career, something called asset based community development. And the questions of that are simple and beautiful. What do we have? What do we know, what do we love? What do we miss? And what can we do about it? And uh, what can we do about it is what businesses can we build? How do we build an economy around those things that makes them stronger, doesn't destroy them. You interact with them, those assets without destroying them.

Speaker C: Yeah. In a non destructive, non destructive way. Describe the vision for the inn. Uh, for those that aren't familiar with it, I think I read this right, that the inn is one of the only, the only or one of a very few number of Michelin three key level, you know, properties in all Canada. Right.

Speaker A: It is, it's one of two and, um, three key properties. And we just got, we got awarded it first last year and it's some kind of secret shopper kind of thing. Uh, and we just got it again for this year.

Speaker C: Oh, congratulations.

Speaker A: Yes. Well, thank you.

Speaker C: For those that don't know, for those who are not allowed to explain why that's such an important distinction. And, and again. Yeah, like what I'm trying to get at is once you explained it to me, this seemed very natural. I was like, oh, I see how the engines, the economic engines you're describing have created, as you say, the ability to bring economic value into the community without destroying the things that it loves. That makes sense to me in retrospect, but the first time you explained it to me, I found it quite confusing. I was like, how did you went back home and you start at an inn. Like, uh, it's. It's not the most obvious thing, so. So I want to make sure that people actually, like, understand concretely, like, what is this thing that we're talking about?

Speaker A: Okay. So the inn, it's a beautiful building designed by a Newfoundlander, and it's, uh, infinitely lookupable. Uh, and when Todd Saunders, who's the architect, um, and I first started to get to know each other, the. We. We never had a contract really, but he had a very simple design brief. And the design brief was, you have to figure out how to express in contemporary architecture what we have learned in 400 years of clinging to this island. And so it needed to be a vessel that mediated the relationship between the past and the future. So because the world had moved and our way of making a living was no longer in tiny little wooden boats close to the shore, because now we fish further offshore, all that knowledge, m. Was at risk of being lost. We don't build because we don't need little wooden boats anymore. But the knowledge to build a little wooden boat is deep, local, ecological, cultural knowledge. So we were. We can't. We. We commissioned a whole bunch of little boats from the older people that could still make them, and we still have those, so we gotta have some examples so we don't forget. But we started a furniture building program. So we decided we were going to make. Not just make the inn ourselves, or mostly ourselves, we were going to build all furniture. And so we invited designers from away, contemporary designers to come. We partnered them up with local makers, and every object in the inn was conceived and made by them. So we're using local materials, local knowledge, local makers, contemporary, the best of contemporary design. Because when you think about communities, they don't have design as, uh, at their right, at their fingertips. M. Design is like a handmaiden of business, not of communities. And if you think about. Do, you don't have to go back all that far to realize that the maker and the designer used to be this one and the same. And then somehow that cell divided and design became a thing, like a big thing. And the makers who live in local places all got left behind.

Speaker C: Yeah.

Speaker A: And who. Who are the designers working for? Corporations. So the world, uh, like, uh, corporations, kind of, in a way, because they're Organized and they can, they know how to work with money and they can have all the smart people working for them and the lawyers and the accountants and communities around the world, especially small ones, I think, uh, we've been all kind of looking at this, going, how did this happen? How do we get left out of the world? And so, I mean, I see the organizational unit of the world being communities that can be more effective and more coherent, uh, with a little bit of thinking about themselves as economic actors. And so this design process that happened, this making process, really strengthened the knowledge, its new relevance through new use. And it became a little business as well, in its own right. We make furniture and we sell it. Now, I could sell you a chair, Eric. I'm sitting in a chair that I made. You'd love this chair. I think you should have one. And so that, so that's a business minded way. So to come back to the question, what's the business for? What's it doing? What problem is it solving? Who is it for? And same thing with agriculture. We, when I left home in the mid-70s, we were growing almost everything that we ate. You know, we, we weren't having melons, but you know, we, we were growing root vegetables. I don't think we knew what arugula was, but, um, we were feeding ourselves. And then when the ferry started running every day, we were just importing everything. And as we did that, we were sending our money away and we were disempowering ourselves. We were losing our knowledge about growing. So we thought, okay, we're an in. We have to feed people. And so of course we're going to serve whatever is local. And we're going to use the, the inn as an engine to encourage people through commerce to grow more things again. And that has actually happened. So a business can do that. And that is the beautiful thing about hospitality. What better we putting you in? How are we greeting you? Every single, every single cultural interaction in the tourism industry is an opportunity for commerce and business that supports the place and the culture that it's in. I mean, I always think about cruise ships because in some ways they're like the perfect extraction machines. They're like placeless, wandering around the world, uh, making sure we get all the money and hold it in our system. And our in is the total opposite. It's like, how can we get the money? How can we create demand and build a business that makes them m make money go down, not suck it up?

Speaker C: Well, it's an example of a concept I call mission transmission, where you know, you could easily. I hear this from people in business all the time. You know, I could easily have you say, well, we want. Unfortunately, we want to serve local food, but there's no longer any local agriculture. So too bad. We want to use local furniture, but sorry, it doesn't. It's always, you know, the market has not provided what we need, so therefore we must, uh. You know, you see this excuse everywhere. I wish we could use organic materials, but there's no organic supplier. Or are we just did a previous interview, uh, episode with, um, with Seth Goldman from, From. Who created Honest Tea. And he was talking about how, you know, when they were doing tea, there were no organic ingredients for tea. And so they could have said, well, oh, too bad, I guess we have to make it the same way everybody else.

Speaker A: But.

Speaker C: But mission transmission says don't hold that my mission is to create this thing, to accomplish this purpose. Then, um, what happens beyond my walls matters also. That's also part of the story. And to be able to use an economic engine to catalyze the things in the world you want to see is incredibly powerful. Was this in your mind when you started the end? Like, what was your. What did you have in mind when you first started? What did you think it was going to. Since then, it's become this incredible conduit, not just for economic activity, but it's such a high profile place. Um, you get lots of celebrities and thinkers and all kinds of very cool people who would never have set foot on Fogo island in any other circumstance. Did you have that even in mind at that time? What did you think you were trying to do?

Speaker A: I thought we were trying to build a business and to. To contribute to an economy. And, you know, Fogo Islanders suffered a lot with a loss of economy and culture. And I really wanted to remind and to get Foglanders to see that what they have, what they know has intrinsic value and it can have market value. You know, it's very dangerous if apathy sets in. Uh, and if you get to cynicism, that's. That's another stop on the road to nihilism, by the way. Um, yeah, and if you get to cynicism, then people are like, oh, you know, it's all messed up and we have no power over it. And I mean, how often do you hear, oh, the only thing anybody cares about is money. What's the point of anything? Well, you make a point. And I think the best businesses, and business is the best way to prove that intrinsic value can be supported by the Market. It can be. And I could preach at you about that or I could show you. And I. And, um, we were absolutely thinking that when we were starting the inn. Absolutely. And we took every single thing and said, how can we use this to support the things we know, the things we have, the things we love, every single thing. And how do we. In a way, I don't say tame money, but it's a little bit tame money. So one of the things we decided super early on is the inn has no tipping, absolutely no tipping, because we wanted there to be. And I think that's the very definition of hospitality. If there is not a level playing field between guests and host, it is not hospitality. It's not, how do you do that in a commercial establishment? It doesn't work. If you're going to hand me $20 and the next person $20, then you shouldn't trust my hospitality in that moment and you shouldn't trust my motives. And I will feel utterly diminished because all of the things that I know that have intrinsic value and, uh, you came because you're interested in those things have been reduced to a transaction. And it has. Any hope we have of having a relationship has been swept away by the $20. It's an indignity to guests, it's an indignity to hosts.

Speaker C: Amen. Amen to that. I think that that attention to detail and that kind of seeing every little thing not as an obstacle but as an opportunity to take the hardness of it, to communicate the ethos of what it is that you're making is something that I see in the, in the most mission driven companies, you see that obsession over and over again, where it's like a typical business is like trying to eradicate all difficulty, reduce decision making to a spreadsheet and kind of just make money by whatever means necessary. You get this kind of like lazy, sloppy default that like produces these pretty grim outcomes. And of course people that work there are miserable and the ecological impacts are devastating. Like always, whenever I encounter a company like that, I'm always like, what is it for? To your question, like, who is being served by this slop? And we're seeing with AI slop now just taking over everything, like, who is it for? What is the purpose of this? Whereas in a company, and if you talk to someone who works in a company like that, say, listen, I want you to have this attention to detail. I want you to, if I pitch this idea to them, they'd be like, that just seems so. Business is already so hard. You're Going to make it so much harder.

Speaker A: Yes.

Speaker C: Yeah. And it's like. But then they still want the outcomes. Like the reason this is such a famous place and people go travel from all over the world to go there is precisely because we did the hard thing. That's what creates the opportunity. So this kind of like modern obsession with like profit without value, you know, like easy, easy, easy money without doing the work and this just like really lack of attention to detail. I see, I see everywhere. And I wanted to ask you about it in the context of what you mean by community because I remember uh, we uh, were talking a few weeks ago and you said something to me that really stuck with me. You said people don't even understand the word community anymore. I think you even said like you all drive a Subaru. That doesn't make you a community. Something like that. I just thought that was uh, so poignant. So explain what you mean by community and why the modern idea, common interest is not sufficient.

Speaker A: Exactly. Proximity is essential for community. And so when I say community I mean a community of place. I suppose they are place based community. And I think we pretty well know uh, that if there's a hell, the road to it is paved with frictionless convenience. M and communities of place are not frictionless. And it's, it's a place where people live in some kind of a tangle with each other. And entanglement with each other is a super important part of would if I, if I, I'm. I'm in my house on Fogo island now, if I just lived in my house and I didn't have interactions with all the people that I am physically close to that we wouldn't be in a community. And so that uh, a community of place is where we have a shared fate. F A T E and that it is the fate of that place. So if the ferry breaks down here tomorrow, we are all in that shared fate. And so that, ah, and the people in a community that live together in a place, they don't have to like each other. I grew up, you know, next to uh, a brother of my father who those two men didn't really like each other, but they sure leaned on each other and supported each other. Yes. And that is super beautiful because if you have a life organized just around the people you like, I think you just. What happens is you're not experiencing a healthy friction and a healthy, A healthy kind of figuring out how I belong to the whole. So you suddenly you start thinking that it's all about you and you know,

Speaker C: you're describing modern politics in a nutshell right there.

Speaker A: But if you. But that's a terrible thing because, uh, if you believe it's all about you and that then you can never be happy unless, I don't know, you never be happiness, everything you have your own way or something, as opposed to, you could be happy for other people in the community and you could be happy for the people in the future that are going to have a better life because you did something different. And so, uh, it's about embodiment, because empathy comes from embodiment. And so that's what a community is. And it's not frictionless. And you know when you said earlier when you're talking to people in business, they're like, oh, God, it's already hard enough. Now we have to do all this other stuff. We have this too at the end. There are days when we kind of look at each other. Oh, we do this particular thing, you know, around a daybreak, a box at the inn. Every guest in front of the door before they wake up have, uh, daybreak box. And it's like, it's really. That's really hard because someone has to come in at three in the morning and then we have to, we have to figure out the delivery of it. And. Yeah, but we'll always do it because it's a way of showing care. And, and we put ourselves in the place of the guests and say they have a gentle awakening that you don't have to get up and get dressed or use telephone or call because you want. It's just, it's, it's there as our gesture for you. And then when you're ready, uh, to meet the world, we're ready. We're ready for you.

Speaker C: That's a great metaphor. You said that part of your goal here was not just to support this island, this place, this community, but to show a different path, a different way of business. I can remember exactly how you, how you put a different relationship of, of, um, culture, um, to business, to money. And so talk about the Shortfast Institute and this kind of larger project that you've been engaged in to just to show people a different path of what our future could look like if we embrace some of these principles.

Speaker A: So when we started, we absolutely had this idea of intrinsic value and what's here and to build a business, businesses and an economy of our true assets and all of that. And to make. This is another thing that's an aspect of it, I think is we're saying, is to make the investment and Meaning money. But to make sure that all investment that we make is actually development. Because most investment is just investment, it's not development. And that's how. Well, if I invest to just make money. I mean, like, I think most real estate investment is just made to make money. And so even though they call it real estate development. Yeah, we got to stop letting them use that word, development, when it's just investment. And that's how come the financial economy got so big or one of the reasons it's like five times bigger than the real economy. Development happens in the real economy and real people's lives in real places. And so it's to take something that has an intrinsic value and use money to invest to bring it forward, make it stronger, give it a longer life, bring forward a human being's potential or a community's potential or a blueberries potential in a way that doesn't rip every blueberry bush off the planet. So that's investment. I mean, I want to live in a world where all investment equals development. Because money can do the things we ask it to do m tell it to do. And so anyway, we started with that. That was very much in our mind. Development, development, development, community economic development. And it was not a plan to start an institute for place based economies. That wasn't in the beginning, but what was happening over the years because it's in its 11th year now. We also have an art program and that art program is super important to how we belong to the world. It's uh, a contemporary, it's a residency based contemporary art program. And through that artists are coming to us from around the world. Artists have a different way of knowing. It brings a different understanding of value here. And it puts us in a world in a different way. That's not. It's about knowledge, not just about transactions anyway. But as time went on and people were coming and staying at the inn, the number of times, I mean, I would say every person who's ever come will say, when I go home, I'm going to look at my home differently. I'm going to look at where I live differently. And I was in a conversation with one person who said, you know, it's all very well and fine here because, you know, there is a community here. Where I live, there's no community. And once I got past the fact that, you know, she didn't live on the moon, she actually lived in a place. Uh, and so I said, I think, uh, I think you could make one a community. And um, what you need to do is you need to. Is there a door in your house? And yes, there's a door. Come out the door. Doesn't matter if you turn right or left, but go to the next house which probably has a door, and knock on that door and introduce yourself. And so you will start. That's how you make a community. And you can make one anywhere, but you have to make one and, and you have to commit some amount of yourself to that. Anyway, so, so we were starting to get people saying, well, you come and you know, talk to our community. Will you do this? Will you do that? Can you, can you write down your methodology for how this is done? And so anyway, we've been at this, that we did. Um, there's actually a Harvard business case on some of this, by the way, uh, called a place model. And uh, I actually went to Harvard a few times to be with the students who were studying this case. But it's not. We really want to share it with other communities. And we did a pilot project during the COVID lockdowns with five other communities and started to realize actually there's a lot that can be shared. And it's not do what we did, not every community can or should have it in, but it's how we did it. It's the way of thinking about value and assets and business. And then, um, we realized that the best way to do this is to build, build a network of communities and try and distill these practices so that they can be learned and shared. And really what we're trying to foster in communities everywhere is economic stewardship. And then the other thing I have to say, because it's super important to thinking is there's an economist at the University of Chicago named Rajan Raghuram Rajan. He used to be head of the Reserve M Bank of India. And he wrote a, ah, very important book that came out in 2019 called the third pillar. Ah, and he says this beautiful thing which is human societies rest on three markets, governments and communities. And we have steadfastly eroded those community pillars to the point of dysfunction. And nothing that we need to accomplish in this world of ours is going to be accomplished until it happens in a place. And so we need to rebuild that pillar. And as importantly, we have to figure out how to come together in some kind of collaborative musculature across these pillars. Because the things we need to get done, we need the market, we need government, and we need communities. And that's not the way we've been doing it for the last 50 years. But it's the way we need to do it.

Speaker C: We'll make sure to link to his work in the. In the show notes. Um, I realized I forgot to ask you about the economic nutrition label. So just explain what the economic nutrition label is.

Speaker A: So in the. We, uh, it's probably clear that we have a bit of an obsession with money and where it goes and what it can do, and inviting and causing it to do the things we know it can do to support intrinsic value. And so part of the problem with the modern economy is it's such a tangle. Most people feel it's something that happens to them and you don't know how to shape it. And when we were starting, you know, you could see these buy local campaigns everywhere. I mean, mostly they don't work at all. You're just nagging people and just trying to understand if you spent your money here, where does it go is such an important thing. So we looked at the food nutrition labels that came, uh, in my lifetime m. And most people probably wouldn't eat something without at least taking a passing glance at it to see what's in it. And so we thought, why don't we just use the same format? Because that graphic is inside of our heads and the shape is in the public domain. So we created something called an economic nutrition label. And it tells you two things. It tells you geographically where the money goes that you just spent on that T shirt or that stay or that chair, that whatever. Uh, and it tells you how the money breaks down. So how much went to marketing, how much went, uh, to the people who work there, how much went to profit. It just tells you where the money goes. And so the idea of it is to have it available at the point of sale so that you can just use your money to support the things that have intrinsic value or the things that are important to you. Right.

Speaker C: Uh, according to your own values as the consumer.

Speaker A: Including your own values. Exactly. And maybe you don't care, and that's fine, too. You don't have to look at it. Lots of people eat cheesies that probably shouldn't eat cheesies because you don't care. And that's fine. The information is just there. And so part of the Institute's work is we're rolling this out more broadly. And, you know, I'm 67. Who knows how long I'll be here? But I'd love to see in my lifetime that this has really become something that people just won't buy something, uh, without seeing the label. So I tell people all the time. If you're going to buy a new sofa or something, ask the vendor for the economic nutrition label and they probably won't have it yet. Just pull it up and show it to them and say, you know, you really should be showing the economic nutrition label. We're going to get this right now.

Speaker C: Tremendous, tremendous power and leverage.

Speaker A: It is maybe, you know, in my, in my, in my wildest dreams it could be regulated, but that's probably not going to happen.

Speaker C: Well, you know, people would have said that about nutrition labels if you showed them to them 50 years earlier.

Speaker A: That's true.

Speaker C: So, uh, what's that Ursula Le Guin quote? Um, you know, something about our economic system seem inevitable, but sort of the divine right of kings.

Speaker A: Yes.

Speaker C: You know, these things do change, but it requires people not to pre commit to the idea that it's impossible. Yes, but rather to say, look, well, since we don't know what's possible, may as well say what we believe, you know, and see what happens, see where we go from there. The other thing I wanted to ask you about was the corporate structure, uh, of Shore Fast, because you mentioned that it's a registered charity. But my understanding is that the companies that are overseas are for profit companies. Is that right?

Speaker A: Yes. So our corporate structure is we have a separation, as we jokingly say, of church and state, meaning that charity is called Shore Fast. And it owns the building that the inn is operated in and it owns any of our intellectual property and it operates a number of programs of which ART is one of them. And so then it also owns a company, a uh, standard for profit company called SureFast Social Enterprises Inc. And that company operates the inn and the furniture business. We have a restaurant on the island. We have an ice cream shop which happens to make the best ice cream in the world. And that for profit company, SSEI or shortfast Social Enterprises Inc. We, we run it like a social business. And as I jokingly say about it, that doesn't mean it's a socialist business. It's a social business. Ah. Which means we think very broadly about what impact we're having and uh, who's it for. And that's where decisions get made about we're not buying lettuce from some giant food distribution company. We're buying lettuce from the man that's across the harbor. Um, that, that's a social business would make that decision. And when, when companies ask me, which sometimes they, they do they actually think about because I, I, I tell giant banks that they could be social businesses and what does that mean? It. Well, for example, here's what something. It means you pay people as much as you can possibly afford, not as little as you can get away with.

Speaker C: Right?

Speaker A: Small, uh, just a small shift. And so that's what the world needs, right, is small shifts in how we see things. And those are called miracles. Miracle is nothing more than a tiny little shift in how you see something. They happen every day.

Speaker C: Like the tiny shift in how your father saw the world once he came to understand money,

Speaker A: just. That's exactly right. And he understood it differently.

Speaker C: Well, I want to say thank you, you know, for coming on and having a conversation and also for the work that you're doing, you know, not just. I, uh, know on behalf of. Of a. Of a tiny island, you know, as you said, far, far away from far away. Like, uh, you know, a very remote spot on this planet. And yet the ideas that you pioneered there, I think are going to have a lot of residents in a lot of other places. And I appreciate you just you sharing that perspective and bringing it into the world. Hopefully, for. For those of us who don't come from that place, we nonetheless can be inspired by your example to think about who all this is for in a

Speaker A: different way and to think about value, what has value. And it's a business story, Eric, so thank you for letting me tell it to you.

Speaker B: You've been listening to the Eric Ries Show.

Speaker C: The Eric Ries show is produced by

Speaker B: Jordan Bornstein and Kiki Garthwaite.

Speaker C: Research by Tom White and Melanie Rehack.

Speaker B: Visual design by Reform Collective.

Speaker C: Title theme by DB Music. I'm your host, host Eric Reese. Thanks for listening and watching.

Speaker B: See you next time.