Social Activism at Work with Dan Schulman

Michael Rivo: Welcome back to Blazing Trails. I'm Michael Rivo from Salesforce Studios. and today, I'm joined by Monica Langley, EVP of global strategic affairs at Salesforce. Before joining Salesforce, Monica spent 27 years at the Wall Street Journal, covering CEOs, billionaires, presidential candidates, and she's a best- selling author, a corporate attorney, and well- known TV news commentator. Welcome to the show, Monica.

Monica Langley: Hi, thank you for having me, Michael.

Michael Rivo: Oh, well, it's my pleasure. Today, on Blazing Trails, we're featuring an episode from your new series, The Inflection Point, which is produced by Salesforce. And it's framed around the idea of inflection points in the lives of CEOs that you interview. Why was this the angle that you wanted to pursue with the show?

Monica Langley: This is a great question. And the CEOs that I've put on the show were like," Why are you doing this to me, making me get so personal, and tell you my inflection point?" And that is the reason. Suddenly, when we were all trapped at home during COVID, a lot of companies and news outlets started featuring leaders, and how are you getting through this unprecedented time? Salesforce launched early on a series called Leading Through Change that got the best thought leadership and products on how to stay relevant and productive during the pandemic. But then we thought we can go beyond that and ask some of our top leaders, who are inspirational, and influential, what are they doing? Not just during COVID, but for the future, because we're all looking forward to the future. And that's what I wanted to do. And I wanted it to be different from what everybody started doing, because what I saw by the news outlets and other corporate websites, they asked the typical questions like," What is your background? How did you get to the corner office? Have you had to make a tough call?" And I'm like," These are not compelling, they're predictable." Even worse, they were boring.

Michael Rivo: Yeah. Well, it's true. It's a unique angle, and I've listened to a few of the episodes and watched on our YouTube channel as well. And it does bring out a whole different side of these leaders, and it's really insightful. I appreciate the taking that approach.

Monica Langley: Well, thank you. And here's what I wanted to do, Michael, is I wanted every episode to be different and memorable. And I can guarantee you, if you watch these CEOs and other leaders, not a single one will give the same answer, because it has to be truly, what is your inflection point? And it's that moment when everything changed. It'll tell something about a personal backstory, a professional influence, or some value that made them who they are today. And I know myself, I had a critical inflection point in my life, and there's a before, and an after. And that's what I wanted to ask these most powerful people.

Michael Rivo: You've spent your whole career at the Wall Street Journal and at Salesforce in conversations with some of the biggest leaders in business and politics. And what have you learned from those conversations over the years? And what are you bringing to this new series from that history?

Monica Langley: You know, what I have found Michael, is that so many people think all these CEOs and these powerful people are untouchable, they're out of reach. And in reality, they have their own strengths and weaknesses, and their own challenges, and their own very human stories. And that is why The Inflection Point gets to the people as human beings. And you know what? It forces the CEOs to come out from behind the dreaded talking points. As a reporter for 27 years, I would do these page one profiles, and they came with their talking points in their head. And I would just put down my notebook and say," Come on, let's talk about you. What's really going on in you?" And I would walk behind the desk. I would read on their desk. I would do whatever it took to get them behind their talking points. And that's the thing that we do with the show, is we ask them these questions. And once you find the inflection point, it really goes, it's a much better tenor of conversation that is much more approachable to find out... I think our viewers will find out," Who are these people? And why do they lead the way they do? And what got them to this point today?" without the predictable answer.

Michael Rivo: Right. And I think it gives a takeaway for the audience too, which is, these people have done extraordinary things. And then when you see that they're sort of the same as us, and how they've reacted to situations in their life, that you can integrate that into your approach. And I think that's what's so important about this series, is that it's not just talking to somebody who's going to bring their talking points and their corporate point of view, but it's really giving you something that you can learn from in becoming a leader yourself.

Monica Langley: One quick example, Michael, is Darius Adamczyk, the CEO of Honeywell. He has 200, 000 employees. He is totally transforming that company, from the people who made our thermostats, to the most advanced technology you can imagine. And here's the thing, he talks about how lonely it can be as a CEO, but he learned that grit and determination from when he immigrated here, when he was a child from Poland, and that was his inflection point, because all the... He didn't speak English, all the kids taunted him with every Polak joke they had. And he said he wanted to go back to his home country of Poland. He was so miserable. And that's his inflection point. And now, you see how he has that grit and ability to lead from the office of CEO, and be humble, but also know that it's okay to feel lonely, because he did it as a child.

Michael Rivo: Mm- hmm( affirmative). Amazing. Tell me about the interview we're going to hear today with Dan Schulman of PayPal. What were some of the key takeaways for you?

Monica Langley: Okay, Dan Schulman is clearly a CEO with a heart. You know that he is trying to democratize financial services through PayPal and Venmo. And he even, during COVID, made sure that all their employees were getting a living wage, and made changes so that every employee became a shareholder, and reduced their healthcare expenses and things like that. You will see that he is motivated by his heart, not just his head. I kind of knew that in my preparation, but when I asked him his inflection point, I thought he was going to go back to when he spent a night, homeless in New York city, or was trying to cash checks as a young executive before he went to PayPal, and do something about that, talk about his inflection point, because that's how he learned how the unbanked lived. But guess what? His inflection point, I'm not going to give it away because I want people to listen to it, was one that I was totally unprepared for. And the film crew with me, literally, gasped. I heard them gasp behind me. And it was something that we all did not expect, but it was so hugely personal that people wrote to me afterwards. They said," I will never look at the PayPal CEO in the same way again after hearing what was his inflection point."

Michael Rivo: That was an incredibly powerful moment. And this series today, we're hearing on the podcast, but you can also find it on our YouTube channel. And the show looks great. It's got a really interesting way that you guys handled the remote recording, and you look great. And it's really fun to watch as well as to listen to. Tell us a little bit more about what you have planned for the season, some of the guests, and what you're doing.

Monica Langley: Well, we started in April, so we have a few episodes that are out now, and each one will come out on YouTube on Tuesdays. One that came out that got a lot of people talking, everybody knows who Jim Cramer is on CNBC, the host of Mad Money, and Squawk on the Street. He opened up on his inflection point, on how he got to TV from being a wizard on Wall Street, but the show is called Talking Money and Murder. And I got some really cool stuff about when he lived in his car.

Michael Rivo: Wow.

Monica Langley: And it's crazy. You've got to listen to that one.

Michael Rivo: Yeah.

Monica Langley: The Ford CEO, Jim Farley, is also wonderful. Did you know his grandfather worked for Henry Ford, making Model Ts? And now, Jim Farley is transforming Ford. It's really fun. We also have the Cleveland Browns owners, a husband and wife team that I have known since we were children in Knoxville, Tennessee, so this is like down- home week when I interview them. Valerie Smith is the president of Swarthmore. She is an expert on African- American studies. And she is so wise on where we are as a country today, and how she's trying to bring diversity to her liberal arts college. And then just last week, we had the Coca- Cola CEO, James Quincey, and you'll find how he's trying to bring sustainability to Coca- Cola as they make lots of plastic and bottles and aluminum cans. And I also asked him," What is your favorite beverage out of the 4, 000 you make?" You have to watch it to find out.

Michael Rivo: Wonderful. Well, you can find all of those episodes on our YouTube channel, so go check it out. Thank you for joining us today, Monica.

Monica Langley: It's been my pleasure, Michael. Thank you.

Michael Rivo: Okay, wonderful. Let's get into the conversation with CEO of PayPal, Dan Schulman.

Monica Langley: Thank you for joining us, Dan.

Dan Schulman: So nice to be with you.

Monica Langley: All right, let's start at the name of the show, which is called The Inflection Point. Was there a moment in your life which has made a tremendous difference for you when everything changed?

Dan Schulman: The moment that sticks out in my mind quite vividly, it's a tragic moment, but I think we all share that. We've all gone through tragedy in our lives. It was my younger sister, died early from an aneurysm. I was still in my 20s when that occurred, and it really redefined just everything. It was like a bomb blew up in my head and redid all the wiring in my brain. And it really took me from pre my sister dying, where a lot of life, unfortunately, it was about me. That's how I defined it. And that post her dying, I just became much more aware that every moment is a really important moment, and that recognizing the world beyond yourself is so crucial and so important. And I will always thank my sister for making me a better person. I wish she was still alive, and I was the worst person, but she taught me an amazing lesson.

Monica Langley: Whoa, wow.

Dan Schulman: And that probably was the most important inflection point in my life, for sure.

Monica Langley: That's really poignant. And that was a few decades ago. Since then, you have been making a lot of moments more positive for so many more people in the position of leadership that you are in as the CEO of PayPal. But from the beginning, you have been pretty involved in social activism as a youngster even. And then in the positions of power, you have continued that to be able to help other people. Did it start when you were in a baby stroller with your mother taking you to a Martin Luther King rally?

Dan Schulman: I remember my dad telling me the story later in life, that he was worried that I'd be the youngest person to ever have their picture in an FBI file. Both my parents were social activists. They were both amazing role models, very involved in their communities. I remember vividly, my dad was in charge of a chemical plant in Pascagoula, Mississippi, and this is in the early 1960s. And a person that worked directly for him, a black man, was fired by the plant manager down there for drinking out of the wrong water fountain.

Monica Langley: Oh, wow.

Dan Schulman: And my dad decided that he had to fly down to Mississippi, and reverse that, confront the plant manager, who was a very powerful individual, and said," That does not happen on my watch." And I remember talking to my dad when he came back, I said," Why did you do that? It seemed so dangerous." And he said," We're defined by not what we say, but what we do." That always stuck with me, and just this ability to look at everybody with respect, and that everybody should have equal opportunity, has always been just a large part of who I am.

Monica Langley: Even before we get to PayPal, you've been taking actions on your own to make sure that you had the empathy and understanding for what others were going through. I think it was at American Express that you went out, when you were there as a young executive, and you tried to cash checks to see what that experience was like for people who were not part of the financial services regime. I mean, they didn't really have access to that kind of service.

Dan Schulman: For me, for somebody to really advocate for the products and services they're building, they need to experience firsthand why they're doing it. And I did this twice. Once, when I was the CEO of Virgin Mobile, and we were supporting homeless youth, and we were working with an organization called StandUp For Kids. And in front of all of our employees, director of that said," And Dan is going to spend 24 hours out on the streets, living as a homeless person to understand firsthand what that's like, and the empathy that that gave the experiencing person." It was only for 24 hours. It was not something heroic by any means, but learning firsthand what it meant to be invisible on the streets, what it meant to feel unsafe when you're trying to figure out where to sleep on the streets. After that experience, I could advocate for homeless youth, and why we were doing this in a way that I couldn't by just understanding facts. And I did the same sort of exercise when I got to American Express, where we were trying to serve populations that were outside the financial system that had a cash check stand in line, that then had to stand in another line to pay their bills. And you understand that intellectually, that that's very difficult, but until you go through it yourself, you don't understand how dehumanizing that experience can be, and how problematic it really is. And so, once everybody went through that, then the products and services we were designing to help that, that it was done with a passion around doing the right thing for those populations that were struggling to get by.

Monica Langley: Is that why it has made you as a CEO, much more sensitive to inequity. I remember several years ago, on the North Carolina bathroom bill, you were like almost the very first to take a stand. Were you scared for that?

Dan Schulman: Companies that aspire to be great companies, and I think PayPal is a good company, but we aspire to be a great company, need to have a purpose that they stand for, a mission that they believe in, and then a set of values around that that support that mission. And one of the key values we have is embracing diversity and embracing inclusion. And I felt that the bathroom bill, which allowed for the potential discrimination against somebody for their sexual orientation or sexual identity was anathema to our value set. And I was watching the governor in my office on my computer, and he said something like," You know, a lot of companies are talking about stuff, but nobody's taking any action, and we're going to be fine doing this bathroom bill." And I literally walked out of my office, down to the head of our corporate communications, and I said," We're pulling out of North Carolina. This is unacceptable." And by the way, not everybody agreed with our action. I got plenty of death threats.

Monica Langley: Oh, crosstalk I'm sure you did. I mean, I was at the Wall Street Journal at the time, and covering this. And it was quite the controversy. Most CEOs and companies thought you are crazy, okay?

Dan Schulman: Yeah.

Monica Langley: And at the time, they did not think that profit and purpose go together. They thought," Why is he doing this, sticking his neck out like that?" And by the way, Dan, you had not been the CEO of PayPal that long.

Dan Schulman: I will say, it was this moment, one of these proud moments inside PayPal, where our employees knew that we would stand up for our values. And by the way, that's tested every single year. And I don't know how any CEO or any company thinks of themselves as not part of their community, not part of their country, and their economies. We are all better off if everyone has opportunity, and everyone has at least a modicum of financial health and safety, because it's crucial for our democracy, it's crucial for our economy, it's crucial for social justice.

Monica Langley: Then it must've been kind of earth- shattering to you when you found, closer to home, inside your own company, you heard that some of your own PayPal employees were struggling to make ends meet, especially of how you feel, and what you've done your whole life in wanting to make opportunity for so many people.

Dan Schulman: Yeah. Well, that was actually a surprising result for me, to tell you the truth. I did a survey of all of our employees, because I thought the results coming back would be really something for us to be proud of, because we're PayPal, we pay at or above market rates everywhere. And we're in the fortunate position to be able to go do that. Even with that, what came back is 50%, mostly, our call center employees, our entry- level employees, but 50% of our employees were financially stressed. They were struggling to make ends meet at the end of the month. And we decided we had to measure this. And so, we created a metric, we called it net disposable income, NDI. And so, we worked with Academia. We worked with a couple of nonprofits. And what they said to us is, for somebody to be able to save, for somebody to be able to dream that their kids will have a better life, and they can aspire to other things, you need to target an NDI of 20%, which is five times what they were earning. And so, here we are, a couple of years later, we slashed healthcare costs by 60%, we increased wages, we gave every single person in the company equity in PayPal so that they could enjoy any successes we would have in the market. And today, the minimum that any employee has at PayPal is 16% NDI. And I hope at the end of this year, we'll be quite close to that 20% target that we set up, because great employees who are passionate, who are financially healthy, who are inspired, will serve our customers better than any other company might aspire to go do so. And if we do that better than anybody else, then over the medium and long- term, we will maximize the return that we can give to shareholders.

Monica Langley: Let me stop you for a sec, though. Doing all these things, lowering the cost of healthcare, giving them options, raising their income, all these things costs you money. It did have to hit your bottom line. Did you just say," I don't care. It's the right thing to do"?

Dan Schulman: Any CEO in any company can maximize profits next quarter. I am trying to build something that over the medium term, over the long- term, is something that we could never hope to build if we weren't making those investments. And I think if you look at our results, and you look at our performance in the market, I would say a lot of what we've done in our investments have paid off.

Monica Langley: Well, that's for sure. I mean, when the pandemic hit, everybody was online all the time. And I have to say, my use of PayPal, personally, went up. And in part, you had these very loyal, happy employees, helping fuel the surge in your business.

Dan Schulman: You know, we went from having, call it 60 offices around the world, to having 40, 000 offices around the world, because everybody's working from home. Our volume skyrocketed. The demand for our products increased in terms of not just what we already had, but incremental services and capabilities that we needed to put out. I was so proud of the way our employees responded to that. Actually, the number of software releases that we put out increased by 26%, year over year, even though we were working remotely. And that really comes from employees that despite all the mental stress they were personally experiencing, and the changes in their life understood just how important it was for us to serve our customers. And we really didn't miss a beat.

Monica Langley: Your stock has surged too. I think that, for you as a CEO, your philosophy of taking care of your employees is paying off. And so using that as a track record, then you now are trying to tell other CEOs," Get in line, people. We need to be paying our employees a living wage." But how is that going?

Dan Schulman: There's a very fine line there, Monica, which is, nobody really wants to be told what to do, and nor do I really want to moralize, because I know everybody's facing their own pressures. But taking care of our employees, really, is a competitive advantage for any company. Each of us may not do exactly the same thing. Like, I'm all about employees, others about the environment. But what I do think is really important is that all companies, and all leaders of those companies stand up and lean into the issues that face us. As a global society and as a global economy, we each can do something that can make a difference. And I think we have a moral obligation to do that.

Monica Langley: Do you think it is going to become the norm in capitalism now, stakeholder capitalism, or not?

Dan Schulman: Everyone is served better, honestly, and our companies are served better, our political systems. If people don't have a modicum of financial health, how can we... And they think the system is working against them, how can we expect them to rise above their own self- interests, and think about interests that are maybe good for the whole, but maybe not for themselves individually. And our democracy requires that... My favorite quote on democracy is, it needs to be more than two wolves and one sheep voting on what to have for dinner.

Monica Langley: Now, we've got to talk about Venmo. I can't let you go without talking about Venmo. I mean, for heaven's sake, like most apps, I learned about it from my daughter, who's now 22, but in high school. I saw her... They were all splitting lunches and car rides with Venmo. I didn't even know it was part PayPal, I just knew Venmo is great, PayPal is great. Now, I realized they're all part of your company.

Dan Schulman: Yeah.

Monica Langley: Tell me about Venmo, and how you envision it going forward.

Dan Schulman: Oh, that's funny you mentioned that you didn't know it was part of PayPal. I gave a speech at New York University. I thought a very inspiring speech, and one young man said," That was so great, but the company you really need to worry about is Venmo, because we all use Venmo." And I was so happy to tell him," No, no, that's the same company." Venmo has experienced explosive growth over the last five years. It's simple, and easy, and social way of doing payments, and managing and moving your money. It's less of a financial app and more of a social type of app.

Monica Langley: But you have big plans for it, I know. Don't you?

Dan Schulman: We do.

Monica Langley: Okay.

Dan Schulman: We're tremendously expanding the functionality of Venmo, because the customers who use it love it.

Monica Langley: Exactly. Well, I'm one of those. Okay, let me go to a topic that is important to you. And I think you maybe still do this every day, this martial art of Krav Maga. You've been doing this since you were a teenager. What are the similarities between this martial art and business, and why do you do it? And did you do it this morning before we started chatting?

Dan Schulman: I do it almost every morning. Krav Maga is sort of the Israeli martial arts system. It really means contact combat.

Monica Langley: That sounds scary.

Dan Schulman: Yeah, it's-

Monica Langley: I couldn't do it.

Dan Schulman: You could do it.

Monica Langley: Okay.

Dan Schulman: And you would inaudible very good at it. What I love about martial arts is not just the physical element of it, but it's really the mental element of it. It's the philosophy around martial arts, and really, the ability to quiet your mind in a very high stress environment. One of the prevailing philosophies of Krav Maga is, the best way to win a fight is to not get into a fight. And so, the art of deescalation, the art of being able to be humble enough to walk away from something, as opposed to confront it. And also, the philosophy of knowing that if you're in a fight, the surest way to get hit is to stand still, and to face off.

Monica Langley: Sure. I could say that.

Dan Schulman: You always have to move. And so there's so many of these philosophies and adages that can be applied to professional life, as well as our personal lives. That's a large part of why I've done this for so many years.

Monica Langley: And you have a podcast that you call Never Stand Still, which I guess is part of the philosophy behind Krav Maga.

Dan Schulman: Exactly. It's basically talking to CEOs, and athletes, and musicians, and a number of different people. I'm like," How do you get up after you've been hit?" Because, everybody's been hit, and no one, I don't think has ever had a straight line career, or life that just goes up into the right. We've all had tragedies. We've all had very difficult times. And it really is, how do people respond to that? How do they get up? How do they think about that? And what lessons can they impart?

Monica Langley: I know that you mentor people, and people always want advice from you because you are considered a values- driven leader. You've got your podcast, you're highly regarded as a person and as a professional. What advice would you give to people as they face now, this world that seems more uncertain than ever?

Dan Schulman: inaudible.

Monica Langley: What are the next steps I need to take?

Dan Schulman: Yes, I was just talking to my daughter about this yesterday, and what I told her is, I said," Molly, don't worry so much about your next step, because whatever it is, it's just the next step on a long journey." And people always think that next step is so monumental and momentous, and like a... The truth of the matter is, what's that saying? Like, man plans and God laughs, or something like that. And it's just sort of like, take a step and learn from it. Like, what did you like about it? What didn't you like about it? What went right? What went wrong? And then that next step, you build on what that was. And so, to me, I think that's a really important part of not being paralyzed in life. Just know, that next step, even if it's a bad one, you'll correct it going forward. And if it's a great one, you'll build on it. I think we just need to keep moving, keep adjusting, keep learning all the time. And I think the best way to learn is to listen a lot. One of my favorite quotes from my dad was something like, you're born with two ears and one mouth, and you should use them proportionately.

Monica Langley: And take a step at a time.

Dan Schulman: Yep.

Monica Langley: And never stand still. Thank you so much, Dan. It's been such a great pleasure to have you and listen to your thoughts today. Thank you.

Dan Schulman: Thank you so much for having me. It's been my pleasure as well.

Michael Rivo: Well, that was episode one of our new series, The Inflection Point, featuring PayPal CEO, Dan Schulman, in conversation with Monica Langley, EVP of global strategic affairs here at Salesforce. You can find the whole Inflection Point series, featuring some of the world's most influential CEOs, on our YouTube channel. Thanks for listening today. And if you liked this episode, be sure to subscribe wherever you get your podcasts. I'm Michael Rivo from Salesforce Studios.