Podcast Spotlight – Tropical MBA with Venkat Rao

Podcast Spotlight Featured

February was dreary. I created distractions to avoid the big push forward on things that matter. I know the steps I need to take but I’ve prioritized planning over execution, playing out what-if scenarios and researching solutions to reassure myself that we’re making the right decision. Plain and simple, I’ve been afraid to commit and fail.

March is a great time to refocus, find new ideas that challenge your old mental models, and talk about productivity. Sarah shared her productivity rule, and my productivity post is a new series on INCREDIBLE podcast episodes that flip our thinking on its head.

One key part of my personal productivity routine has been missing since we hit the road, and I only just realized it.  In the months leading up to leaving my job and South Africa, I listened to podcasts religiously.  They challenged my philosophy on life and my approach to business, and ultimately pushed us to become nomads. Unfortunately, I didn’t make time for them after we went nomadic.

Moving forward, Sarah and I will highlight podcasts that make us feel stupid, that keep us up late talking, that change the direction of our business. (E.g.: not a podcast, but The True Cost made us realize that we had a lot more work to do to make Nomadica a sustainable and high-impact brand).

Podcast Spotlight: A Conversation With Ribbonfarm’s Venkat Rao

This week’s featured podcast is from Dan and Ian over at the Tropical MBA. It’s fitting hat Tropical MBA is the first featured podcast. These guys first emboldened us to go nomadic, and their thought-provoking interview motivated us to create the podcast series, so the inspiration coming from Dan and Ian never really stops. In this podcast they interview Venkat Rao, blogger and influencer in the world of ideas. The several ah-ha moments in this podcast provided ego, gut, and sense checks about navigating the business of our new life.

Listen Here: http://www.tropicalmba.com/ribbonfarm/

Missionary/Mercenary Dichotomies (Ego Check)

Vankat talks about the unnecessary friction between missionary/mercenary workers. In this dichotomy, a missionary is someone like Steve Jobs who sacrifices everything to make an impact on the world, even his time and personal relationships. Venture capitalists and big tech employees can see themselves this way. Mercenaries like Tim Ferriss on the other hand, arbitrage the global landscape of opportunity in order to optimize their own lives.

Which role do you lean toward, and does this dichotomy really exist? We’ve been in both camps at different points in our careers. I don’t believe either is right or wrong and there are plenty of degrees in between. There are missionary tendencies in how we will position our brand and source our products, yet Sarah and I are extremely selfish with our time.

The missionary/mercenary discussion reminds us not to fall into the sanctimonious hypocrisy of saying “Eff the system, I don’t want your money, Silicon Valley!” In reality, both models feed off of one another. Nomad life isn’t possible without huge corporate tech like Skype, Paypal, Google, etc, while VC firms could eventually be the ones with enough influence to make this lifestyle possible for more people as they identify the remote working trend and make ground level investments into companies that enable it.

Boiled down: Don’t preach or judge, it’s unproductive. Do look for connections between industries, and the opportunities in those intersections.

The Fallacy of Passive Income (Sense Check)

Dan and Ian questioned Venkat’s thoughts on the digital nomad lifestyle, lifestyle design in particular, and how Silicon Valley interprets it. (Lifestyle design businesses are those that optimize for the owners’ lifestyle: an owner may not want to spend time managing employees. She might decide to sell a business when it gets big enough to require them) Sarah’s and my businesses will always be on the lifestyle design side.

Venkat: It’s the future of course! (his words, not mine). but it’s not all sunshine and rainbows. Venkat touches on the fallacy of passive income, which we’ve already seen among the Chiang Mai crowd. You may have seen this as well –  the 20-year old bootstrapping backpacking entrepreneur who went all in on affiliate marketing and gave up after 3 months because his strategy failed to deliver passive income at the rate he expected. At best, Venkat reminds us, you put a ton of work into the so-called passive income stream at the beginning and reap its benefits for a while, but eventually have to step back in and prime the pump with another round of really hard work in order to keep generating income.

Venkat describes the digital nomad and lifestyle design scene as one of experimentation. One that is messy and ugly, but as with many fringes of innovation, it will be the new norm 20-50 years from now.

The Gervais Principle (Reality Check)

The Gervais Principle is Venkat’s theory of power dynamics in organizations, based on Hugh McLeod’s Company Hierarchy cartoon below and his observations of the hilarious show The Office. Basically, there are three types of people in any company: sociopaths, the clueless, and losers. It helps to ignore the moral connotations when thinking about these groups. Sociopaths aren’t necessarily evil, and losers aren’t necessarily the people getting swirlies in the toilet.

Rather, sociopaths recognize the implicit power dynamic in any interpersonal scenario, and are constantly designing organizations that systemically result in benefits to themselves and the company. They can design win/wins for themselves in terms of employee incentives, they know when heads must roll and whose they should be, and they can make the sometimes ruthless but necessary decisions required to keep an organization profitable.

The Clueless are people who drink the CoolAid. They don’t perceive a gap between the company’s mission statement rhetoric and reality. They will never become executives, but they don’t realize this. They are deliberately used by the Sociopaths as a middle management cushion: people who will tow the line, boost productivity, but who won’t ask the troubling questions the losers might.

The losers simply wound up in a situation that is not beneficial to themselves: if they work hard, they give more to the company than they get back. Consequently they perform the bare minimum of work. Some losers over-perform and proceed into the Clueless middle management, sometimes they under-perform in shrewd ways and are groomed to be Sociopaths.


What makes this theory so fun to think about is that Venkat derived it when trying to explain why the TV show The Office is so funny. In his six part blog series on the Gervais Principle, he draws on many side-splitting but brutally revealing examples from the show.

I found myself in all stages at different parts of my career. American organizations definitely encourage capable yet elegant sociopaths. If you work for a big corporate company, reading about the Gervais principle could help you to understand the bafflement of bureaucracy, and how to navigate it.

Drawing Upside Down (Gut Check)

Venkat also discusses how we project our own mental models onto observations, which distorts our final record of the event. Venkat used the example of a art instructor asking a student draw a man with the portrait upside down. By moving recognizable traits such eyes, ears, and mouth to an uncommon position, the student is able to remove the predisposed idea of what a man’s face should look like and simply draw what he is observing. Another fun example to test your own projections is the Jesus Illusion.

For travelers especially, it’s helpful to remember not to impose your own culturally biased logic onto the new cultures you’re visiting.

There are many other gems found in the podcast, but I don’t want to spoil them for you. Venkat’s genuine curiosity and humor is refreshing. Pair that with ideas that demand a serious gut check and you may be going back for a second or third listen.

Are you living in The Office environment that Venkat describes? We’re curious to hear from our readers (You!) to hear how Venkat’s theories stand up to daily life in and out of the office.


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