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It’s Not Magic: Live from Dallas!

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Last month, our team plus friends from across our Dallas network came together for a night of conversation to discuss business leadership, culture, and connections.

On this episode of It’s Not Magic, our host David Stiepleman, is joined by United States Air Force Major General (ret.) Rod Lewis, True Ventures EIR and Investor Clarence Bethea, and Westbound Equity Partners Co-Founder Sean Mendy. The panelists discuss their remarkable career trajectories, how they set their teams up for success, how to adapt skills and mindsets for the different seasons of a career, and so much more.

Thank you to our speakers, our hosts at the Dallas Holocaust and Human Rights Museum, and our Sixth Street Black Employee Affinity Group for leading a great event in Dallas.

Note: Westbound Equity Partners, formerly known as Concrete Rose Capital.

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Episode Transcript:

David Stiepleman: Hi, everybody. Welcome back to It's Not Magic, our podcast from Sixth Street. We invite influential leaders and founders to get to the core of how they're creating innovative solutions to stand out in their industries. I recently had the privilege of moderating a really inspiring panel at a Sixth Street event at the Dallas Holocaust and Human Rights Museum. It was sponsored by our black employee Affinity Group, of which I am a proud senior sponsor. Dallas is a big hub for us. It is our largest office, actually, and a central hub for the control side of our business. And we are getting the word out in Dallas about us and recruiting black professionals in Dallas. And so that was part of the event that we had in December. And you're going to hear from three incredible individuals and friends of our firm in a conversation about leading, with integrity, about building strong cultures, about fostering meaningful relationships, and about building your career.

David Stiepleman: And I think you'll enjoy it. This is hard because we have so much wisdom and experience from the military, from the highest levels of government, from technology, sports, the nonprofit world, VC entrepreneurship, and we're going to try and extract it in an organized and exciting way. I'm not worried about exciting, but it's my job to organize. Yeah, right. This is not going to be easy. But you're going to help me make it easy, not . We had a call last week. I said, make sure that we all talk over each other and make it a conversation. And we're taking that seriously, and I appreciate it, . Let me introduce our guests quickly in this order, but also it's alphabetical by last name and first name. It's an unassailable organizing principle.

David Stiepleman: Clarence Bethea, thank you for being here. You are now an entrepreneur in residence and an investor at True Ventures. You are the founder and executive chairman of Upsie. It's a venture backed tech company that is disrupting the consumer warranty space. You're going to talk about your experience, I hope, at Best Buy, which is a super interesting story. You did that until April of 2022. You and your family live here in Dallas. You're very committed to communities here as well as in St. Paul, Minnesota, where Upsie was founded. You're originally from Decatur, Georgia, if I'm not mistaken. And you are a committed mentor to entrepreneurs and young professionals in business. You've been super generous to us on that front, and so we thank you. And so we're looking forward to hearing from you.

David Stiepleman: Next to you is Major General Rodney Lewis, who retired in June from the Air Force. He was a two-star general and deputy director for force protection at the Joint Chiefs of Staff at the Pentagon. You are a graduate of the Air Force Academy, where you won as the senior the Hess Award, which is the award for the best graduating senior in terms of loyalty, bravery, intellect, all that stuff. You played football for Air Force. You have an incredible career that we're going to talk about. And you were also a White House fellow at some point during your time in the Air Force, and you are on the board of the White House Fellows Foundation. And I joked this morning when you spoke to our group that you're the worst retiree in history because two weeks after you retired in June, you got your PhD. And when I tell people this, they laugh at me because they think I'm joking. You also then have, since then, trained on the new commercial aircraft, 787--

Rod Lewis: Boeing 787 Dream

David Stiepleman: For United, and you will fly flights for United. So you might get on an international flight on United Airlines, and General Lewis could be your pilot. So your retirement does not look like a lot of retirements. And then last but not least, someone who's definitely not retired, though he feels tired, is Sean Mendy, co-founder and partner of Concrete Rose, a venture capital firm that is near and dear to the hearts of us at Sixth Street, and has been a guest on the podcast before. You're a Bay Area Native. Well, first of all, Concrete Rose, for those of you don't know, I think most of you do know, is a firm that invests in founders of color and companies that serve underserved communities and in other startup companies that are serious about what we'll call the diversity proposition in a productive way.

David Stiepleman: But I think you know what we mean. Bay Area native. You spent your career working to close opportunity gaps in Silicon Valley. And prior to Concrete Rose, you were an executive at the Boys and Girls Club of the Peninsula, an advisor to the Chan Zuckerberg Initiative, a venture partner at Next Play Ventures, and an entrepreneur in residence at Sixth Street. You have experience building meaningful connections across the venture ecosystem. Guys, thanks for being here. It's an unbelievable opportunity for us to, to get some wisdom from you. So I'm going to start Rod with you if I could. We've heard you talk about the different seasons in one's development, in one's life, one's career. And I'm very interested by this topic because I'm getting old.

David Stiepleman: I also think it's an important topic for people to hear. You graduate, you become an airman. I forgot to mention, you've flown 3,600 hours of missions, including combat missions. You become someone who's at in the rarefied air of official Washington. Like these are very different skills. So to say you were thirty-seven years in the military as one thing is very reductive. How do you do that? How does one do that? Going from when you're doing the thing and you become good at the thing, and then you have to, you get into another seat and you have to become good at a very different thing. How do you maintain that frame of mind?

Rod Lewis: First of all, thanks for the question, David, and thanks for allowing me to be here and be on stage. I think as you think through the arc of your career, the things that you think about as a twenty year-old are maybe different than a thirty-year-old or forty-year-old. And as long as you have that intellectual curiosity, that's the key that propels you to put yourself in different situations and just absorb whatever you can to lean into that. And I think that's what I've been able to do with my career. The Air Force was wonderful in presenting different problem sets and different opportunities for me, whether it was flying airplanes or sitting in the White House, or doing something that I hadn't imagined doing. But the intellectual curiosity and understanding that you do have those seasons in the arc of a career, and you just apply what you've learned in the past, those experiences, and you apply them to the present, and then you also look over the hill and over the horizon for the future.

David Stiepleman: Clarence, you have some experience with this. There’s a through line, maybe you can talk about it, of entrepreneurship throughout your entire career from the trucks, to the gym, to Upsie, but they are different businesses.

Clarence Bethea: You've actually watched my videos. That's awesome.

David Stiepleman: Well, I'm just going to show up here and just introduce myself in front of a hundred people.

Clarence Bethea: It happens. Believe me it happens. First of all, thank you for having me. I think the arc of my story going from, you know, the trucking industry, to basketball, to starting a company, and then to VC, one, it's by the grace of God that I went through all of that and made it here today. And I think that without him, I don't think any of that stuff happens. I don't mean to get on church and preach on you, but it's the truth. Then my wife, who's here with us tonight, it was without her believing in me before I believed in myself. That was really important. And so for me, I don't take any of this for granted because I know that a kid from Decatur, Georgia is not supposed to be here today, but I'm super fortunate to be here.

David Stiepleman: With the trucking company, I felt like you learned how to drive a truck and then you guys hustled and you bought another truck and you drove the crappy truck, and then but Upsy where you take the lesson that you observe while you're at Best Buy, wait a second, why are we doing this? They're similar, they're scrappy, they're figuring stuff out, but they're different. Were they different?

Clarence Bethea: Yeah, totally different. I have a saying that if you want to do things that other people can do, you got to be willing to do the things they want that most people are not willing to do. And when I was driving truck and lifting sheet rock every day, a thousand pieces of sheet rock a day, that same hard work pays off today. Like when running a company or a venture capital, it's all about persistence and am I willing to do the things that nobody else is willing to do? Then I also believe in EQ. I believe you have to have unbelievably high EQ to understand the room that you're in and where you fall at in that room. And I just think that's been a special talent of mine: being able to understand I'm in this room, here's what I need to do to succeed in this room.

David Stiepleman: Sean, when you guys at Concrete Rose are evaluating talent, I know you're very rigorous about this. Are you testing for this adaptability? And how do you do that? And if not, do you want to start?

Sean Mendy: So the way we evaluate companies. It's in our rubric. Clarence has been through it, we invested in Clarence's company, and it's eleven categories with seven to twelve questions per category that we're asking about. So in evaluating a founder, yes, adaptability is absolutely one of those things. One thing that we try to do with our process, or just in everything that we do, but especially with our investment process, is to make it as objective as possible. A problem in venture capital is that folks obviously will often invest in somebody because there's something they really like about that person. They can't put their finger on that. The person's just got it. There's something about them. And we want to get away from that because one, what if you ate a bad burrito that day and you're not feeling it, and then that person you think hasn't got it, but really it's just you're feeling like crap that day, right?

Sean Mendy: The more these are observable, demonstrated things we can observe, the better. So adaptability, it's not just are we looking for adaptability? What's the evidence that this person can do that, that we can see in their background? It doesn't have to be adapting in the workplace. It can be adapting in a home situation or in an educational situation. It's often in the workplace because these are people who have often been doing something professionally that has led them to identifying a problem that they then want to solve. But I think if we're not seeing that, like you just can't be a startup entrepreneur. And so it's kind of a deal breaker to not see that in the founder or their co-founder. But it's absolutely super important to what we do and what we look for.

David Stiepleman: Ron, I feel like the Air Force must have some tried and true methods at this point, taking in raw material, if I can put it that way, of young men and women who are looking to serve their country, but they don't know what to do. How do you do that? How do you bang people in shape?

Rod Lewis: Well, the Air Force, 700,000 people total force. And it is a process. There's a framework and that initial process is what we consider bootcamp, where you can take any individual from any location in America, and you bring them into this organization. And the first thing that you have to have is the culture. You have to create a culture that's sustainable, that's welcoming, and one that is full of rigor, right? In order to get the best product. As we bring individuals in, and we think about it, you are an individual, however, we're going to make you a part of this team. And that's the secret sauce. I think being a part of a team and being part of something bigger than yourself. And that's taught at the very beginning. So people embrace that. And I think as long as we have that framework that's set, and of course there's measurables along the way, that you have to do your physical stuff and mental stuff so that we can place you in the proper job and role. And that's important as well, putting the right people in the right space to help drive the mission forward. And I think the Air Force does a great job of doing that.

Sean Mendy: Are there applications?

Rod Lewis: No.

Sean Mendy: Well, just building on that, and I think this is something that I would assume would serve you well in the military. But also just coming back to adaptability, adaptability doesn't mean you always know what to do; you just figure it out on your own. It's also what do you do when you don't know what to do? Do you have the humility to be able to admit to yourself I don't know how to do this. And then do you have the confidence to communicate that you don't know what to do? And then do you have the discernment to figure out who's the person I need to go to, or what's the research I need to do, or what's the process I need to go through to actually learn it? So, adaptability doesn't mean I can drop this person in any situation, and they figure out what to do.

Sean Mendy: It's what does this person do when they are uncomfortable? When something needs to change, can they recognize something needs to change, understand what they don't know themselves, and then figure out how to go and solve the not knowing part of it, if that makes sense. And when it comes to culture and something that I've seen as somebody who, in attempting to start an investment firm and walking into a Sixth Street office with these two crazy guys saying, we'll help you do it. Stiepleman is one of them, and Alan Weiss is the other. It was being in a situation where, all right, these are people who are best in the world at what they do. Is it safe to admit, I have no idea what I'm doing?

Sean Mendy: And again, back to culture. The culture at Sixth Street, at least in my experience, allowed me to do that. And it was actually encouraged. And then I noticed that, alright, this was not unique to just my situation. These were also people who were leading real businesses. This was Alan Waxman and David Stiepleman themselves, the two people who you would expect to be adaptable and to know what to do, coming to people, didn't matter where you were on an org chart and asking what to do, or asking what people thought they should do, and trying to solve and find those solutions. And that, I think, is key to the culture of any successful organization, is that humility and that that safe space to be, to not know something.

David Stiepleman: I think you're talking about a two-way street too. You have to create that environment where people feel comfortable and they know they're not going to get laughed at or yelled at for not knowing something or to take it a step further, things get messed up, right? And if things get messed up, you want someone to raise their hand as quickly as they possibly can and say like, this got messed up. Or maybe don't use the passive voice. I messed this up, but I want to figure out how to fix it because that’s how you snuff out problems, and that's how you learn. To your point earlier today, Rod, about failure and learning from failure. How do you, and maybe Clarence or Rod, you can answer this question, how do you develop that culture? Do you have stories about how you manage to make that really alive in your organizations?

Rod Lewis: So I'll take a stab at that first, and then Clarence I'm sure has something to do with it. But as we're having this conversation, one of the things that's resonated in my mind is this term courage. So not only creating that environment and that culture, but me as an individual, I have to introspect. I have to think about what I'm good at, what I'm not good at, and have the courage to ask for help. And I think that's so important because most people, I won't say most people, but a lot of people fell to get to that next level because they didn't have the courage, you know, as Sean said, hey, I'm going to lay this on the table. I'm talking to Alan and David, I don't know this, but I want to do this. This is my vision. But he had the courage to explain that and stand in front and say, can you help me? Or will you help me?

Clarence Bethea: Yeah. And I think it's courage. It's also humility. But it's also the ability to be say, I f***** up. Like straight up. I think it’s the ability to be like it was my fault. And sometimes that means you saying it's my fault, even when it's not your fault to make sure the team understands we're all in this together.

David Stiepleman: That's leadership. I think the buck stops with you. I understand that ultimately whatever happens here is my responsibility. Yeah.

Sean Mendy: Less provocative, but maybe slightly pro provocative. How do you build that culture as you pause and you actually think about the culture, what's important and what type of culture you do want have, and then you do a lot of work to define it. And then you do a lot of work to define what behaviors you're looking for in your organization that actually reflect the culture that you want to create. So what are the values? We call it vision to values within our organization, but let's define what the values are. Let's define why those values are important to us, and what that actually means. And then let's define when you're in a meeting, if you say you want to have this type of meeting, what are the behaviors that you're looking for within this organization that demonstrate that that's the culture that we value, that the type of people who will do well will understand that this is what we're looking for, and they can actually deliver on that.

Clarence Bethea: Yeah. And I think the truth is culture only shows up. Real culture only shows up when it's bad. Like when things are going wrong, then culture gets pressure tested. It never gets tested in the good times.

David Stiepleman: Do you have an example?

Clarence Bethea: I have a bunch of examples. Thank you for asking.

David Stiepleman: You're welcome. That's what I'm here for.

Clarence Bethea: Probably the example that sticks out to me was when COVID happened. We spent a year building an office in Minneapolis. We moved in January 3rd. COVID kicked us out March 23rd. And our team was looking at me saying, when you hired me, you told me you were going to have my back. You were always going to put me first. I told our team those things when I was hiring them. And it got to the point where, and I'm sure Sean, you remember this time, investors are like cut head count 50%, burn all of those things. And I remember I went to an advisor and I said our culture says that I'm supposed to keep everybody on. I'm not supposed to listen to investors, you know, but I got to raise another round.

Clarence Bethea: So I need these people to be bought into me. And he just told me never sacrifice your culture. And so I went back to the team over Zoom about a week later and I said, hey you know what? We're going to keep you at full pay. I'm going to cut my pay. And my wife is laughing back there because she's like, he really did that. I'm going to cut my pay. I'm going to continue to pay you full salary and we're going to get through this storm together. A year later, we raised one of the biggest Series A in Minnesota history. And it was because our team was bought in. Like hey, this dude is serious about taking care of us. And it paid dividends.

David Stiepleman: That's great. COVID was hard. Any other lessons from COVID by the way? As leaders?

Rod Lewis: Well, I can tell you, just to kind of piggyback on the culture aspect, one of the things that I think about our core values, and I think that's where leaders really spend time thinking about this is the environment that I'd like to create and these are the core values. I know Sixth Street has created as their core values in that. And that matters. And I think as a leader, setting the stage for the culture is important, but it's extremely important to just communicate it. And then when you think you've communicated enough, that's when you're just getting started, do it again. And that is so important. And then one of the other things that I found as well, when you do see that situation where you can say, let me use this to show folks that we believe in what we've been talking about, you actually have to lift that up, elevate it to the highest levels in the organization, and share that with not only the stakeholders internal to the organization, but the stakeholders external to the organization so they understand what you're about. I think that's important. So core values is a piece of that as well.

David Stiepleman: I want to keep talking about culture because what's more important than that? Clarence, I've heard you talk about grace as a defining element of the culture you want to live in, presumably in your life, but also in the company. What is that?

Clarence Bethea: Grace is an interesting thing because most people don't understand grace until they actually need it. See, when I start getting mm, does that mean I don't?

Clarence Bethea: But grace is at the core of who we are as a company. Matter of fact, in our office it says live life with grace. And grace often is like this biblical thing that people want to talk about. But for us it's about how do we treat each other in our worst times? How do we treat our customers when they're calling us and they need help? So grace for us is who are we at our core? And you know, I have another saying, I have a lot of sayings, that says ninety-five percent of the decisions that are made about you, you won't be in the room for.

Clarence Bethea: And I think if you think about that, how you treat people, because you never know if it's going to be that janitor that makes a decision about you. So treat everybody well because then more of those things will go your way than not.

David Stiepleman: I'm going to unpack that a little bit because there's, there's two things there. One is what goes around comes around, it's kind of a karma point, which I believe in. It's also we call it presuming good faith. Grace is more succinct and probably a nicer way to say it, but presuming good faith, listen, not everybody's going to say everything exactly the right way all the time. We're not all going to have our best days every single day. Let's presume good faith, let's assume that we're trying our best, and even though we might not agree on stuff, let's have that all be left outside and treat each other well. Rod, I have this question for you. The state of the world right now is so divisive and people are always asking corporate leaders to speak out on particular issues or to have a point of view, and it's very fraught, and maybe very necessary as well. The military has to stay focused on the mission, and God knows you got a lot of opinions inside the military from left to right. How did you make sure that that stuff sort of ended at the water's edge and you were able to keep people focused? What's the secret?

Rod Lewis: Well, so I think the commonality with the military is everyone in uniform raise their right hand to support and defend the constitution of the United States against all enemies, foreign and domestic. And that's the bond to know that what I'm doing in uniform, I work for you, I work for the American public. The president makes a decision at the executive branch, legislative branch, and judicial branch. I work for the American public. So the decisions that are bestowed before me as a commander, as an airman at the basic level, I know that I'm doing this for a greater cause for my country and for the elected individuals that have ordained that order. So, I hope that it's the right thing, right? Whether I'm from Texas, Oklahoma, California, you name it.

Rod Lewis: But I know that I have to do that duty. So that piece, and then it also ties to the mission. And we talked about this today, really the mission of the Air Force that I've been a part of is to fly, fight, and win at the basic elements. And what does that mean? That means that I know the mission. I know that that person that we just talked about that showed up in bootcamp is learning that mission, fly, fight and win, and everything within the organization, every ounce, every penny that the American public has put into the military goes towards me and that individual doing the mission, and the mission is bigger than me, and it's bigger than all of us. It's the voice of the American public. So that helps keep us focused. And I think any organization, whether it's Concrete Rose or Upsie or Sixth Street, if you can define your mission and everybody in your organization knows the mission, then you can achieve great things. And some of the division that you've talked about, you're going to bring individuals in your organization to have different experiences, different paths, et cetera. But you have to have something that galvanizes everyone together. And that's, I think, the secret sauce to the military. I, Rodney Lewis do solemnly swear to support and defend the constitution of United States against all enemies foreign and domestic.

David Stiepleman: Sean, I'm going to ask you a question. I want to talk about relationship building. You're an incredible relationship builder, and I want to talk in particular about mentors. I think we've all benefited from great mentors and people who took an interest in us. When you are a mentor to somebody, what makes that a valuable relationship or - valuable is the wrong word - rewarding relationship for you with the idea being that, someone who's thinking about, gee, how do I get that mentor to take an interest in me, maybe across racial lines, maybe across age lines, or functional lines or whatever. Tell me what makes it valuable or rewarding for you when you get to mentor somebody?

Sean Mendy: That's an interesting question. What makes it valuable for me? Usually the people that I'm mentoring have similar values or are on a similar mission to what I'm on. So it's actually just usually in service of the mission, right? Or my vision for what I feel like the world should be. Like folks who are diametrically opposed to my views are not coming to me asking for guidance. Maybe they should to be able to beat me, but usually it's just in service of whatever this common goal that we typically have. Clarence was just at our annual summit, our Founder Summit, and we had about a hundred founders there. And we've got all these tech leaders who've built some of the biggest companies in the world, sharing their wisdom and connecting with folks, and people are coming up and thanking us for doing it.

Sean Mendy: But the reason we're doing it is somewhat self-serving because they're building the types of companies that we want to win, that we want to grow, that we want to see shape the world. And it's in the same way that mentoring somebody who's coming to me for advice, who's trying to do something that I want to see happen. That's the simple, I guess, self-serving answer. And then I think I enjoy learning from all types of people. There's a Ralph Waldo Emerson quote, he says, every man, I say every person, is in some way my superior, in that I can learn from them. And so, you can learn from anybody. Everybody knows something that you don't know about something. And so I'm curious and like to learn from people and in those mentoring relationships, similarly to how I've built relationships with most of the mentors I have.

Sean Mendy: The folks who I spend time mentoring are not coming to me saying hey, will you be my mentor? It's like the eighth time that we meet that I realize I'm already mentoring them because it's just been interesting. I've been saying yes to the meeting because they're bringing something interesting to me, or there's something interesting about them, and I want to spend time with them. There's no mentor that I have - people come to me saying, hey, what are the keys to networking? What are the keys to recruiting a mentor? Be an interesting person, working on interesting things, who has high standards, who pursues excellence, who does what they say they're going to do. And I think that there will be gravity that you create that will recruit those mentors and then also kind of be lucky too.

David Stiepleman: I love that. What about you, Clarence? I mean, how do you build sustained relationships? Genuine relationships? Not that it's supposed to be in the service of something economic, but you have to be intentional about it. A word Rod used a lot today.

Clarence Bethea: Yeah, I think it's about being authentic. Every single time you meet me, you got to meet the same Clarence every single time. And if you do that, I start to build trust with you, and then the wall comes down. I think you've seen enough things with me where I talk about the story of the CEO at Best Buy. That's where you were taking me to, by the way. Good job.

Clarence Bethea: And he changed my life. You know, I'm a kid from Decatur, Georgia. I grew up selling drugs my whole life, in and out of jail, in and out of juvenile just doing all of the wrong things that a young man from Decatur, Georgia would do. The former CEO at Best Buy called me to his office one day. We hadn't had a real conversation. I didn't really know who he was. And he called me to his office and sat me down in the cafeteria. And he said, hey I think you're special. And I remember the moment because I didn't grow up with a father. I didn't grow up with positive male role models. And I remember sitting at the lunch table and he said you be quiet, I'm going to talk.

Clarence Bethea: And I was just like, sure, you're paying for lunch. So it's fine. I vividly remember I had a burger in my hand, and he looks at me, he says, I think you're special. And I mean, I'm already a crier. So I'm crying. I got a snot coming out of my nose. A man had never told me that before. And he just told me, if you will listen to me and trust me I will make sure you have a life that you never even knew existed. And he came to past. So I think mentorship is incredibly important in my life.

David Stiepleman: But slow that down. How did you come to be having this burger? What did he see in you? How does this happen?

Clarence Bethea: So I worked at a gym, this basketball gym. His three sons were there doing basketball. I was doing sales there. So I was just talking to all the parents. We never had really had a conversation, but one day he was late for his payment because we didn't have a credit card on file. And I asked him, I said, hey Mr. Dunn, we don't have a payment on file. You have three kids here, you owe us like $8,000, so could we get you to pay that please? And I remember he pulled out his wallet and I thought back to when I was a young man in the streets, and the only time we saw guys with money was when they were doing the wrong thing. It was like piles of money. And I remember he pulled out his bill fold and had like hundreds of dollars, like stacked up and he just started flipping off money.

Clarence Bethea: I didn't know who he was. So I was like, who is this guy that's just showing his money like this? Then he gave me his platinum card and was like, here, just put it on that. And I ran to our CEO’s office and I said, hey, who is this Brian Dunn dude? And he was like, oh, don't worry about it. You don't need to know who that is. I was like, okay, whatever. Well, a week later I get a call from him, and he says, hey, I would love for you to come over to the office. Now, I've never talked to him, really. We never had a deep conversation. And he said, why don't you come over? I get over to Best Buy and if you've been over to Best Buy, they have a huge corporate campus, and I'm there and it's like a hundred people in the lobby trying to sell to Best Buy.

Clarence Bethea: And I walk up to the front desk and I said, hey, I'm here to see Mr. Dunn. And she says, oh, you must be Clarence. And I was like, this is weird, how does she know my name? And she's like, all right, let me call him. And normally I'm sure most executives do this. You send the assistant to go get the person to then sit them in a room and wait for a second, and then you walk in with your interest. Well, he didn't do that. So he comes through the security door, because it's all tinted, so you can't see inside. He walks out and the whole lobby stops and he walks out and he gives me a big hug, kisses me on my cheek. And I'm thinking like, we're on the episode of To Catch a Predator. I don't know what's going on. At this point I am flabbergasted that this dude is doing this. So we walk inside of Best Buy.

Clarence Bethea: I remember there was a janitor pushing a bucket and he stopped at the janitor. He said, hey, thank you so much for taking care of my office yesterday. And he pulled out a $10 bill and gave it to him. And he just said thank you. And I remember at that moment I thought about leadership, the leader that I worked for, who I hated at the time. And I was like, it was always about fear and always about scaring you into doing something. And I was like, wow, here's the dude that's probably the most powerful dude in consumer electronics telling the janitor thank you. And so that is when he took me to the back of the cafeteria and he just said, hey, I think you're special. One day you're going to be the CEO of your own company and if you listen to me, I will give you things and you will have a life that you didn't know existed.

David Stiepleman: He had been focused on you. He'd been watching. He knew you from the gym and he'd been watching you. And you had been first guy in in the morning, last guy out at night. And he had experience with you even though you didn't know it.

Rod Lewis: Oh, I want to piggyback on that.

Rod Lewis: This conversation of mentor and mentee, as Clarence was telling that story, it made me think about affirmation from someone who didn't have to give me that affirmation, that was someone other than my mom or my dad, or my aunts or uncles. So, growing up in Oklahoma City in the early seventies, when I went to elementary school, we were bust. I grew up in an African American neighborhood and I was bussed to a school that as we drove along the highway, the 45 minutes or so to get to the school, the neighborhoods changed. The houses changed. I didn't recognize those kind of cars because they weren't in my neighborhood. And I was at elementary school. First grade, my teacher, Nancy Burke, was a woman who as I think about a mentor, was my mentor who happened to be my first grade teacher.

Rod Lewis: And I was this pretty studious individual at the time, and I always wanted to please and do the right thing. And I remember we had a small section where we read a book and then we went back to our tables and our desks and then we did something else, but we would come together to discuss the book. And for some odd reason, I didn't read whatever I was supposed to read that day. And as we were sitting in our inner circle, she called on me and she asked me to go stand out in the hall. And I knew I was in trouble. And when Nancy Burke, who didn't look like me, and didn't look like my mother, came out in the hall, she looked at me and she goes, “You know what, Rod, out of all these students in this class, you're the one, you're special.

Rod Lewis: You are going to do amazing things in life that you can't even imagine.” And I was a first grader. And I know that today. So, I think for all of us, that affirmation, especially when it comes from someone who doesn't have to give it to you, who doesn't look like you, who's not in your inner circle, who's not your mom or dad or aunts and uncles and grandma and grandpas, that affirmation means a lot. And I can see how it impacted you, because Nancy Burke impacted me, and I'll carry that with me for the rest of my life. My next door neighbor Melody and I were the only two African American little kids in that class. And Nancy Burke picked me out and told me I was special. And that's impacted my life.

David Stiepleman: I don't know how I'm going to ask another question because I'm tearing up. It's a great story and I'm remembering moments like that. And it really makes a difference.

Rod Lewis: It makes a huge difference, David.

David Stiepleman: Wow. Let's switch to tactical stuff.

David Stiepleman: Sean, I'll start with you. You are all extremely busy, high performing people. You have a lot of demands on your time and the demands now, I think, are worse because there's constant noise. There's no shutting off if you don't affirmatively shut off. What can you tell people works? Doesn't work? How do you handle that?

Sean Mendy: I'm looking for what works. So I don't have a good answer on that. And you're absolutely right that I don’t know if it's worse. I know that Clarence actually has in his email signature, something that says “I'm sending this email at a time that works for me. Please respond at a time that works for you.” Something along those lines. And there was a period in starting our firm where I felt like I was just constantly operating on other people's time. And I recognized it was not sustainable. I'm on the west coast and I could be on calls at 6:00 AM with folks on the east coast, and then I could be on calls at 6:00 PM with folks on the west coast and it could be, a fourteen hour day of being on other people's time and never being alone to think or do deep work or tackle my own to-do list.

Sean Mendy: I don't have a magic bullet solution at this point. I do know that having priorities weekly and having priorities daily made a massive improvement in terms of what I was accomplishing week to week, and for making sure that the things I cared about were getting done. So prioritization is the first thing I think as a leader of a team, trust and allowing other folks to do things without me sitting next to them or without me reading every sentence and formatting slides. I'm the worst on the team at formatting slides, but I would have the strongest opinions on how they should be formatted. So it was just like a bad formula for how much time I was spending on them. So let's go with prioritization and then trust and delegation being the things have been working for me, but still, there's a way to ways to go.

David Stiepleman: Can I prevail on you for however long you want on a follow up question? How do you prioritize? What's your filter?

Sean Mendy: I have amazing colleagues who at the start of the year and mid-year help establish firm-wide and individual objectives and key results. And then looking at those and looking at my list and seeing what connects to those and what doesn't is really the way that I do it. And then you have to be adaptable, you have to be flexible, and some things change. But even when I feel like I've gotten away from those for a while I found that even starting the year and having some formal processes for how you're actually reviewing starts to make it almost instinctual. And you start to notice that you're making decisions and you're prioritizing things because you've trained yourself to focus on the things that matter. So we actually have a formal process.

David Stiepleman: I think that's super important to actually set up - how are we actually going to go through this? And then ask, are we going to actually stick with it? Because then you have your true north. This is what we're trying to do, and if what we're spending time on isn't accomplishing the mission, why are we spending time on it? There's so much to talk about. Clarence, entrepreneur, operator, and now you're evaluating entrepreneurs and operators. What's different about that? What's something that surprised you about that?

Clarence Bethea: I think Sean will agree with this, that sometimes you sit in front of founders and you're just like I don't care what they're doing. I'm investing because they are just an unbelievable person. And it's funny how often that doesn't happen. I thought because I was a founder and I raised a bunch of money that for everybody this is just kind of how it goes. But I sit in front of founders every day and I don't get that spark. And it actually speaks to, I think, how hard this job is. This is a really hard job every day to evaluate talent and evaluate people in real time. When me and you met, I think y’all invested, four weeks later or something like that? Five weeks later? It was pretty fast.

David Stiepleman: It was shorter than that.

Clarence Bethea: Yeah. It was.

Sean Mendy: You came prepared and sent the memo and you made it easier to know what we needed to know.

Clarence Bethea: Yeah, it was really good. But it was this realization that this job was so much harder than I thought it was going to be simply because humans are humans and you have to figure them out fairly quickly. And I thought that I would be a better judger of that, and I actually really suck at it.

David Stiepleman: Oh, interesting. So, you're obviously going to adapt your methods, you don't want to continue to suck at it, right? So what are you doing?

Clarence Bethea: I think it's about talking to really smart people. I just sent Sean a deal the other day, yes I want them to invest, but I actually want to watch how they evaluate the deal. So we can make sure we're making the right decision. And I think that's a big part of this job: leaning on other people to see what their opinions are and how they're thinking about it to know if how you're thinking is the right way to think about it.

David Stiepleman: Rod, six months, I know I said you're the worst retirer in the world, and I'm standing by that. So your six months in transitioning to the business world is like somebody else’s four years. What's been surprising you about that? When trying to understand how people invest capital or allocate capital and run businesses, are you like, oh, this is kind of the same thing I've been doing for the last thirty seven years. Or is it surprisingly different?

Rod Lewis: Well, I kind of lean on what Clarence said. It's surrounding yourself with people that are more talented than you and listening, and paying attention and observing. So, I've been doing a lot of that and I think that's very helpful. And then intellectual curiosity, one of the things that I did while I was in the military, I went to Harvard Business School for the Advanced Management program. So, all the business cases for a MBA student is just accelerated for the executive level. So I had that experience so I’ve leaned on that intellectual curiosity and then, with Sean and others, just tried to surround myself with people in the business and then being open to the fact that I'm learning a new language and I love that. Having the courage to ask questions and put yourself out there and say, hey, you know what, I don't know everything and I never will and no one will, but this is an area where I think I can grow and having the courage to put yourself in that situation where you might fail, and being okay with that has helped my acceleration.

David Stiepleman: I like it. Last question I think depending on what you guys say. Anybody can answer this, and maybe all three of you will. As we're sitting here at Sixth Street, I'm sitting here as one of the leaders of Sixth Street, what can we be doing better to make sure that our population, our people, are the best from the broadest possible walks of life so we look more like America and that we’re allocating opportunities more equitably? What do you think when you think about either what the military could have done or what the businesses you've worked in could have done, or the business that you evaluate could be doing? And Sean, this is kind of your business, right? What’s your advice to me?

Rod Lewis: I think firms that recognize that today is not tomorrow and is willing to invest in the future, and Vijay was spot on. Talent is everywhere. And it's really up to an organization or a firm to go out and cultivate that talent and create a welcoming environment, create programs that invite individuals in so that they see and learn, and I think Sixth Street is doing a wonderful job of that, and that’s only going to increase. I think that will accelerate the diversity in Sixth Street. And when I say diversity, I'm thinking diversity of experience, diversity of thought, diversity across gender.

Rod Lewis: Just diversity is good. When I sit and I actually have to make a hard decision as a now retired general officer, I wanted people around the table that had different experiences than me, that had different backgrounds than me, and create an environment where everyone could voice their opinion and then collectively we could make a decision as a group. And ultimately as a leader, it's my responsibility. And I think that's what you can continue to do at Sixth Street, just inviting in that culture and having that pipeline of talent and understanding that talent is everywhere. You know, there's lots of Nancy Burkes out there that are talking to Rod Lewis's, but you have to cultivate that and grow that.

Clarence Bethea: I remember when I started Upsie and investors said to me once, “The reason why I don't invest in Black founders was because I've never seen a Black founder ring the opening bell. So start a company and take it to the exit.”

Clarence Bethea: And so I remember that today. And so I think to answer your question, I would say change your view on what is the best. Because I believe I could come to Sixth Street and do you tons of value. But my background probably wouldn't make it through the resume. And when you look at people differently, it's not through the lens that you've been looking at them historically. There are gems out there that can add value to your firm and to your company and to you, if you give them a shot. So, I would say give untraditional people a chance.

Sean Mendy: Two good answers. I know Sixth Street well. I know you well. We've talked about this for several years, and I think you all are doing a lot of the things that I think are important. I think pushing further in that direction is what I would do. And the two things what I'm most excited about, are, so I think seven years ago, I think I had three or four meals with Alan Waxman and didn't know what Sixth Street did. Because anytime I asked a question about it he came back with a question for me. This was back when almost all you were doing was private credit.

Sean Mendy: So it was already like a complicated, not mainstream thing that you were doing. It was a team that didn't like talking about themselves and was pretty under the radar. And so, now just by like talking about what you do, more people are aware of it. I think being very intentional about putting out content, launching programs where an employee at a basketball gym sees somebody with a platinum card, they don't think this person's doing bad things. They think that they must be working in private equity. I grew up in Silicon Valley surrounded by families that were building massive tech companies. I had no idea what a venture capitalist was until I was twenty-five. I heard there was a career called venture capital, but I knew nothing about it, and I was in the heart of it.

Sean Mendy: There's just so many people out there who have no idea about this world who would be good at it, who would find it interesting, who could do it, who are not even on the field because they don't know the field exists. And then the other thing that you're doing, which I appreciate and want to see you doing more of is thinking beyond just the traditional recruiting cycles and creating paths. Let's teach people that this industry actually exists and let's create these onboarding ramps where maybe they'll end up working at Sixth Street, maybe they'll end up working somewhere else, but just by having more people be aware of what we're doing, there's more inputs. And so the outputs can look more representative of the country.

David Stiepleman: I think that's a great answer and great advice. And that's these conversations are about. Vijay I think mentioned the fellowship program and we were talking about this before, Clarence was saying there are people who are born a little bit in finance. They have parents who do this. They speak the language when they're six years old. They know they want to go into investment banking. We need to get to students who aren't necessarily thinking about the world that way because they just don't know. And we explicitly say to people when they come to the fellowship, “Lots of folks you know, who are applying to these programs,

David Stiepleman: they have an uncle in finance, we're your uncle.” That's what we're doing. You may end up somewhere else and may end up with us, that's great, but you can come back to us for help, for guidance, to read the signs, because it is its own language, but it's not brain surgery or flying, complicated aircraft to all parts of the world. Anyway, I'm going to end it there. Guys thank you. Not only are these great professionals and wonderful thinkers, we're friends and it's just a joy to be able to do this with you here. And, I look forward to many more. So thanks.

Sean Mendy: Same time next year.

David Stiepleman: Alright, let's do it.

David Stiepleman: That was major General Rodney Lewis, Clarence Bethea and Sean Mendy. We sat down in Dallas at the Dallas Holocaust and Human Rights Museum on December 5th, 2023. While Rod, Clarence and Sean, have all led very different career paths. They each had powerful perspectives to share on how to build strong organizations and how to be a great leader. You heard about the power of being part of a mission bigger than yourself, how to inspire teams to stay focused on a shared goal during challenging times. You heard about how unexpected connections can lead to valuable lessons and mentorship and how they can sometimes change the trajectory of your career. You heard about the ways an organization's culture can be pressure tested, how those moments can also define core values. And you heard about the importance of investing in recruiting talent outside of the well-worn patterns

David Stiepleman: and how this will help you create paths for people that you wouldn't have known about otherwise. And that was kind of the point of the event. So, thank you Rod to Clarence Deshaun for taking the time to share your wisdom and your experiences with our team. Thanks to the Sixth Street’s Black employee affinity group for putting together an incredible event and to everyone who attended. And finally, a special thanks to the Dallas Holocaust and Human Rights Museum for hosting. I hope you all walk away from that conversation with a new perspective on what it means to lead with purpose, because I know I did. Thanks very much.

AUM presented as of 12/31/2023 and excludes assets and commitments of certain vehicles established by Sixth Street for the purpose of facilitating third party co-invest opportunities. Calculation of assets under management differs from the calculation of regulatory assets under management and may differ from the calculations of other investment managers.