{"slug":"man-behind-grand-theft-auto-6-strauss-zelnick","show_id":"davidsenra","title":"The Man Behind Grand Theft Auto 6: Strauss Zelnick","display_title":null,"title_orig":"David Senra × Strauss Zelnick","dek":"Strauss Zelnick’s 2007 takeover of Take-Two Interactive was a one-of-one hostile acquisition executed with no money, turning a company worth roughly $700M into one valued at about $35B today. His studio-system thesis underpins the strategy: games are the largest entertainment business, while AI can create assets but not reliably produce the zero-to-five annual hits that drive value; GTA 6 is scheduled for November 19, about 18 months late.","lang":"EN","date":"2026-05-17","published_at":"2026-05-17T12:00:07+00:00","duration_min":99,"source_url":"https://www.youtube.com/watch?v=1ZgUcrR0K7I","source_label":"YouTube","rss_url":null,"youtube_id":"1ZgUcrR0K7I","youtube_url":"https://www.youtube.com/watch?v=1ZgUcrR0K7I","thumbnail_url":null,"chips":["person:David Senra","person:Strauss Zelnick"],"provenance":[["SOURCE","YouTube captions"],["SYNTH","claude-fable-5"],["CLEAN","gpt-5.6-luna"],["VERIFY","gpt-5.6-luna"],["PARTICIPANTS","gpt-5.6-luna"],["TRANSLATE","gpt-5.6-luna"]],"title_alt":"Grand Theft Auto 6背后的人：Strauss Zelnick","display_title_alt":null,"dek_alt":"Strauss Zelnick在2007年以零资金敌意收购Take-Two，将一家市值约7亿美元的公司带到如今约350亿美元。他认为游戏仍具制片厂体系优势，AI能创造资产却未必创造爆款；GTA 6定于11月19日发售，延期约18个月。","lang_alt":"ZH","tldr_md":"- **Zelnick's takeover of Take-Two Interactive (TTWO) was \"one-of-one\" — a hostile takeover executed with no money, because \"we had no money.\"** His fundless firm ZMC found a plain-vanilla unamended Delaware charter, solicited the maximum 10 shareholders allowed without triggering a filing (who held ~70% of stock concentrated among ~20 hedge funds), and won an unheard-of floor vote at the 2007 annual meeting with an 88% provisional count — walking into the corner office the next morning of a company with ~$700M revenue, ~$50M cash, an indicted chairman, and four investigations (IRS, SEC, NY DA, FTC). Market cap then: ~$700M. Today: ~$35B.\n- **The irony that haunts the story: Zelnick built a video game division inside BMG, was forced by new Bertelsmann CEO Thomas Middelhoff to sell it — and the buyer was Take-Two, which a month after BMG sold its 20% stake for $14M released the division's first completed property: Grand Theft Auto.** Middelhoff had told him not to sell the stock in the open market, but Zelnick did anyway. In Zelnick's view, most people believe GTA is the most valuable entertainment IP ever created — and BMG had briefly owned a fifth of it for a rounding error.\n- **His structural thesis: the movie business has had \"heads I win, tails you lose\" economics since the 1955 consent decree turned a studio system into a boutique system; video games remain a studio system — \"the moral equivalent of the motion picture business in the 1920s.\" Games are now the biggest entertainment business — bigger at the software level than all other forms combined and growing at roughly double the rate.**\n- **On the AI-kills-gaming thesis that sent the stock down: \"hit creation is not asset creation.** Asset creation is a necessary but insufficient condition for hit creation.\" Data sets are backward-looking, creativity is forward-looking, \"clones don't sell,\" and \"all hits are by their very nature unexpected\" — thousands of mobile games ship yearly, \"zero to five\" hits emerge, \"and you know who makes them? Thank you very much, we do.\" Meanwhile Take-Two runs ~200 internal AI projects under CTO David Klein.\n- **GTA 6 is scheduled for November 19, about 18 months behind the original date — and Zelnick backs the talent through slips because that promise \"gets tested at the worst possible time.\"** The template: approving a $50M remake of a finished game two months before release because the creators said it wasn't good enough — that game became Borderlands. \"Culture like character is tested in the breach.\"\n- **The operating edge is being boring: \"we run a rational organization\" — no yelling, no indictments, solid balance sheet, and turnarounds that start by renegotiating the top 10 vendors instead of firing people.** He cut ~$40M at Take-Two this way; in a GTA release year the company could make ~$100M and lose money the other three, so the plan was simply \"make other hit titles\" under the rubric \"be the most creative, the most innovative, the most efficient.\"\n- **His success meta-lesson is specificity of ambition, not magic: he set out in '01 to build a ~$20B tech-supercharged media portfolio with $300K of his own money and offices with water sheeting down the restroom walls — the company, taken as a whole, is now \"call it a $40 billion company.\"** \"By knowing what you want and working in service of what you want, you are much more likely to get what you want.\"\n","digest_md":"### 1. A one-of-one deal: hostile takeover with no money\n- Zelnick opens with unusual candor about survivorship bias — \"stories like this tend to be sort of self-serving because it worked out well... most deals don't happen, and deals that do happen don't always work out\" — before conceding this one is unrepeatable: \"we essentially did a hostile takeover with no money. The reason we did that is we had no money. So it was really our only choice.\"\n- The frame for everything that follows: ZMC, founded in '01, existed to buy, turn around, and build companies \"at the intersection of media and technology,\" on the thesis that technology would supercharge media and both create and destroy value. \"I thought in '01 it was pretty obvious, but it was not obvious to the entertainment business.\"\n\n### 2. Columbia Pictures, 1983: the least valuable executive becomes the new-media guy\n- His first job was distributing film to free television — \"the last stop on the train\" — when \"new media\" meant videocassettes and pay TV. Columbia's logic for staffing it: \"Who is the least valuable executive at this company that we can put in charge of new media? And that was me... the best thing that ever happened to me.\" His analogy: the way today everyone needs an AI guy.\n- He was a futurist by looking backward — his grad thesis covered electronic entertainment from 1895 (wax cylinders, player pianos) to 1983 — and drew two durable lessons: \"you always have to embrace new technologies. If you fight against them, you'll be left behind,\" and \"most human beings are wired to believe that which is going on now will never change. But the actual state of play is exactly what is going on now will change.\" Politics, the economy, media — \"it won't stay forever.\"\n\n### 3. Vestron to president of 20th Century Fox at 32\n- After doubling his Columbia division's revenue in six months, he became president of Vestron — the largest independent home-entertainment company — at 29, three years out of school, and greenlit Dirty Dancing, the highest-grossing independent film of all time until Blair Witch. But he saw the flaw: \"You can never have a competitive advantage in the entertainment business through distribution only... you got immediately go into production\" — the same reason Netflix produces content.\n- Joe Roth, an independent producer Zelnick knew from Young Guns, was named Fox chairman in '86 and — on Barry Diller's instruction to \"hire a business guy\" — reached for the number-one guy he knew, which Zelnick deflates: \"I was not the number 100 guy. I was the number one guy in this little narrow independent entertainment business.\"\n- The hiring itself is a period piece: breakfast at the Bel-Air, a same-morning meeting where Diller asked incisive questions and Rupert Murdoch sat silently, then the HR head walking him straight into an office to sign. \"It doesn't happen that way anymore.\"\n\n### 4. What Diller and Murdoch actually taught him\n- Diller's method was \"robust debate with a lot of heat\" — \"he's right 99% of the time. But 1% of the time I'm actually right\" — and the survival skill was depersonalizing it: \"if you back down, if you didn't argue, you were done... It wasn't about me. It was about the thing itself.\" A colleague's image stuck: the inflatable clown doll — \"You just get punched, you go over, you keep coming back up.\" Zelnick admits he's collaborative by nature; he comported with Diller's style to reach right conclusions.\n- Murdoch's lesson came during the STAR TV over-leverage crisis — ~150 banks, cross-default mechanics, the whole family business at risk: \"He was cool the whole time... laser focused on the conclusion, and he reached the conclusion just by being focused and calm.\" Zelnick would later channel exactly this on his own first deal.\n\n### 5. The blinding flash: he should have run a movie studio in 1927\n- At Fox he internalized that movie economics have been terrible since the 1955 consent decree converted a studio system (talent on payroll) into a boutique system (talent auctions services per project): \"heads I win, tails you lose\" — the boutique extracts the upside in success, the studio eats the entire flop. Video games, by contrast, remain a studio system to this day.\n- He cites a Buffett aphorism he saw in the back of Forbes — a management with a reputation for brilliance meeting a business with a bad reputation, \"it is the business's reputation that will stay intact\" — and drew the conclusion: \"my ambition should have been to run a movie studio in 1927... What is the moral equivalent of the motion picture business in the 1920s? Well, that is the video game business.\"\n\n### 6. Hollywood's Atari scar, Rupert's \"no,\" and a 95% pay cut\n- Getting religion on games was contrarian because of the 1982 E.T. debacle: Warner's Atari built the game in five weeks, manufactured more cartridges than there were consoles, and cartridges were later shown being plowed into a landfill. Warner took a ~$400M write-down. \"The rest of the business is like... don't ever get involved with video games.\"\n- When Zelnick pitched Murdoch on building a games business, Rupert said \"Great. Go start one\" — but on equity: \"No interest. Like, that's not an offer.\" Rupert has no partners except public shareholders. So Zelnick took a 95% pay cut to run Kleiner Perkins-backed startup Crystal Dynamics, moving his family to a rental about to be torn down for a golf course.\n- His honest self-assessment on entrepreneurial timing: \"there are kind of two stages in life to be an entrepreneur. Before you have anything... and after you have some protection. And I was right in the middle... I don't think I was emotionally ready.\"\n\n### 7. The BMG catastrophe: selling Grand Theft Auto for $14 million\n- Recruited to turn around BMG — whose revenue was roughly $5B — he negotiated the right to build a games division inside it first: ~$40M, \"a rounding error,\" using BMG's worldwide physical music distribution to move cartridges and discs with no added overhead. No other music company was doing it.\n- New Bertelsmann CEO Thomas Middelhoff — \"a person who bet on his gut. It didn't work out very well for him. At all\" — ordered a divestiture before a single title shipped. The buyer, a ~$100M-cap public company, paid 20% of itself in stock; Middelhoff told Zelnick not to sell the stock in the open market, but Zelnick sold it anyway for $14M. \"A month later this public company launches the first property that we had completed... The name of the public company was Take-Two Interactive and the first release was Grand Theft Auto.\"\n- Zelnick's reaction is the tell on his temperament: \"I don't get pissed off easily... I knew it was a foolish decision\" — but he left, because you can't work for a boss who decides that way, and \"now I'm ready to be an entrepreneur.\"\n\n### 8. ZMC with $300K, borrowed offices, and a flooded bathroom\n- ZMC launched with no capital: $300K of his own money, people working free, \"one fewer chair than we had people,\" restrooms with \"water sheeting down the walls.\" Capital providers wanted deals first; targets wanted capital first — he realized after watching a PE firm's pleasantries that \"they said it to everyone. They were just looking for free options.\"\n- The lightning-in-a-bottle first deal was Columbia Music Entertainment, a Japanese record company with 0.5% share, too much debt, no hits, \"probably criminals lurking around\" — a deal he told Ripplewood partner Jeff Hendren to run from twice, until Hendren asked: \"Just how busy are you?\" It took nine years and was \"the hardest deal I've ever done,\" but channeling Murdoch's calm — knowing \"if someone gave me $300 million to take over a company and I failed, that would be my last deal\" — ZMC produced a ~22% IRR in recorded music in the early 2000s. \"Unheard of.\"\n\n### 9. Doing free work for Carl Icahn — \"you never know where this can go\"\n- Zelnick cultivated Icahn — \"the man who said, 'On Wall Street, if you want a friend, buy a dog'\" — by bringing ideas explicitly unpaid. His first, Reader's Digest, made Icahn about $50M on an approximately $50M position; the reward was dinner at Il Tinello, where a martini glided into Icahn's hand in one motion and Zelnick's wife leaned over mid-meal: \"Honey, he doesn't know your name.\"\n- Partner Karl Slatoff, still Take-Two's president, fumed as Icahn escalated to farming ZMC out for free research to his Wall Street friends — \"he has informed us we will never get paid. What are we doing here?\" Zelnick's answer, twice: \"You just never know where this can go.\" ZMC's own memos on Take-Two, notably, said stay away — \"not being so forward-thinking,\" he laughs.\n\n### 10. \"Read the bylaws\": the mechanics of the impossible takeover\n- Icahn's cryptic call — \"Have you read the bylaws?... You know what you ought to do? Read the bylaws. And he hung up\" — revealed a plain-vanilla unamended Delaware charter permitting removal of the board via 50.1% written consent. The distressed stock sat in ~20 hedge funds; SEC rules allowed soliciting up to 10 shareholders without filings, and 10 held ~70%. ZMC couldn't afford the standard ~$3M proxy fight, so this was the only path.\n- Commitments topped out at 48% — \"I was like, okay, it's game over\" — until partner Ben Feder found a second provision: raise your hand at the annual meeting, win a majority of votes physically present, and take the company on the spot. \"Unheard of. It doesn't exist, but it did exist here.\" Then disaster: the hedge funds had lent stock to short sellers and couldn't vote it. \"So what percent do we have?\" \"You're not going to like this. 22%.\"\n- At the meeting — journal coverage, TV cameras, the CEO declining to attend — a law-school classmate waved hello, chatted five minutes, and turned out to be Fidelity, a large holder that had refused to join the group and typically backs management. \"I looked at my solicitors and I said, 'We just won.'\" The provisional count: \"You have 88%. Will you accept that or do you want us to keep counting?\" He walked into the corner office the next morning as chairman, in 2007.\n\n### 11. The turnaround playbook: renegotiate vendors before you fire anyone\n- What he inherited: one good property, GTA, in development and soon delayed; a tiny profitable NBA franchise; everything else losing money. In a GTA release year, the company could make a meaningful profit of roughly $100M and lose money the other three years. The plan: cut costs, \"run a rational company, be friendly to creative talent, diversify the product pipeline, and build an entertainment company.\"\n- His signature move cut ~$40M without initial layoffs: survey the top 10 vendors, negotiate them all down — you save money immediately, you don't scare the team, and \"the team's like, wow, they just saved all this money and no one got fired.\" Never open with expense-report policing: \"that's a great way to alienate David. And if David has another option, he's going to leave the next day.\"\n- A ZMC rule worth stealing: only do turnarounds as the first team in. \"We're not so smart. Smart people all do the same things\" — a prior failed turnaround probably already tried everything you would. And on early Take-Two mistakes: \"How could you? When you're on the floor, there's nowhere to fall.\"\n\n### 12. The pitch to talent — and the $50M Borderlands test\n- The must-have pitch wasn't rationality; it was \"we are going to give you the resources, creative and financial, to pursue your passion... and support you through thick and thin\" — then, as the nice-to-have, a grown-up company: no screaming, no indictments, no getting sideways with the FTC, and eventually a balance sheet so \"when we fail — inevitably, you fail in the entertainment business — we can live to play another day.\"\n- The test came pre-turnaround with limited capital: a division head said a game two months from release wasn't good enough and wanted a remake — $50M incremental and another year. Zelnick dug in, then supported it. \"That title became Borderlands... I'm pretty much going to assure you, no one else in the business would have done it. Why? Cuz it was insane.\" His maxim: \"Culture like character is tested in the breach.\"\n- On managing disagreeable creative geniuses: \"I love them... you have to sincerely care about other people to be an effective leader\" — but not family (\"my family's at home. This is an enterprise\"), and with limits: one abusive creative's emails he simply stopped reading — \"the delete key is there for a reason\" — until \"eventually he had to go.\"\n\n### 13. GTA 6, November 19 — and why games are the biggest entertainment business\n- On the endless \"when's GTA 6 coming out\": \"November 19th, I do know\" — about 18 months behind the original date. On whether GTA is the biggest game ever: it depends how you count against Mario Kart and Call of Duty franchises, \"but in terms of the value of the IP, most people believe it's the most valuable entertainment IP ever created.\" GTA 5's total revenue is undisclosed: \"It's a lot.\"\n- He describes Take-Two as a media and entertainment company: \"We provide an entertainment experience expressed through video games.\" According to Activate Consulting, the U.S. media day is around 13 hours; anything within it can compete or coexist, though playing a game remains different from watching a linear show. At the software level, games are bigger than all other forms combined and growing at roughly double the rate. His 90-year-old mother plays bridge online with friends she's never met. He'd consider diversifying into growth areas like live entertainment, but \"we would not diversify backwards into backward-looking legacy declining businesses.\"\n\n### 14. Visualization isn't magic — it's forced specificity of ambition\n- Zelnick's distillation from \"a billion biographies\": the single common factor among the highly successful is \"they knew what they wanted.\" Not Napoleon Hill mirror-writing — \"by knowing what you want and working in service of what you want, you are much more likely to get what you want.\" Magical thinking, by contrast, is \"because I want it, it's going to happen.\" Senra concurs from his 415-biography database: if he had to compress a decade of study into one word, \"it'd be focus.\"\n- The arc: he set out in '01 to build a ~$20B company; at MIT ten years in, asked if he was \"deeply disappointed\" at ~$1B, he answered \"it's directionally correct and I'm not stopping.\" The company, taken as a whole, is now \"call it a $40 billion company. We kind of exceeded our goals and we're not done yet.\" Take-Two's creed — mission: number one entertainment company on Earth; strategy: most creative, most innovative, most efficient; culture: excellence, teamwork, kindness — is knowable by all 14,000 employees.\n- His mentoring surprise — he spends 20–25% of his time coaching and says he is easy to reach, though people still need to do homework: about half the people he assigns exercises never follow up. \"There are people who believe if I can just get into a room with that really successful person, they can just wave a magic wand.\" His advice to a new employee: show up Monday asking how you'll create more value than you cost, and audit yourself Friday.\n\n### 15. Service beats self-promotion — but one size doesn't fit all\n- How to Win Friends and Influence People \"changed my life\" at Fox, where he \"nearly failed\" running the subtext \"I'm the smartest guy in the room... a couple of Harvard degrees, we're just going to do it my way\" — masked behind humility he couldn't fake, leaving him anxious. The shift: \"How can I be of service to you?\" He retells Carnegie's postal-clerk story approvingly: \"Are we so small-minded that we need to get something out of every interaction?\"\n- But he refuses to universalize it: \"Elon Musk's approach to business is diametrically different than mine... last time I checked, he's the richest guy on Earth and I'm not\" (per the new Musk book, \"camaraderie's dangerous\"); Diller's Socratic method \"can be brutal\" and works for him. His own confessed cost: \"I can sometimes support people who are on the team longer than I should... there are times when I've kicked the can down the road.\" Senra's addition, via Daniel Ek: young founders waste years playing Jobs or Musk instead of finding their own archetype.\n\n### 16. AI creates assets, not hits\n- Take-Two runs enterprise versions of ChatGPT and Claude plus ~200 productivity projects, all within technology under CTO David Klein — no separate \"AI czar,\" because \"we're a technology company that makes entertainment. We always have been.\" Internal criticism, notably, is that they're not moving fast enough.\n- His rebuttal to the claim that sent the stock down (\"with AI, anyone can make a video game\"): \"Anyone can make a video game last week... Thousands of mobile games get put out a year. You know how many hits are made in a year? Zero to five. You know who makes them? Thank you very much, we do.\" AI is \"big data sets, lots of compute, and a large language model mushed together\" — data sets are backward-looking, creativity is forward-looking.\n- The load-bearing distinction, kept verbatim: \"Hit creation is not asset creation. Asset creation is a necessary but insufficient condition for hit creation... You can clone GTA in 3 years with pre-AI technology. But it won't be GTA. Clones don't sell. All hits are by their very nature unexpected.\" He hedges the upside honestly: who would benefit more from AI-made hits than the company that already owns the IP — \"but that doesn't mean AI isn't super helpful.\"\n","transcript_md":"David Senra\n\nCan you run through how you wound up buying and taking over Take-Two Interactive?\n\nStrauss Zelnick\n\nInterestingly, it's not a story that we've told. Part of the reason is that stories like this tend to be self-serving because they worked out well. Not everything works out well. In fact, most deals don't happen, and deals that do happen don't always work out.\n\nBut this one did. It's kind of a one-of-one, because the way we did this deal has never happened before, and I'm pretty certain it will never happen again. We essentially did a hostile takeover with no money. The reason we did that is we had no money, so it was really our only choice.\n\nI had a background in the video game business. I'd started ZMC with partners, and the goal of ZMC was to buy companies, in certain instances turn them around, and in all instances build them up and create value in companies that stood at the intersection of media and technology. The idea in 2001, when we started the business, was that technology would supercharge media, create lots of value, and destroy value. Of course, that's a story now that's more resonant than ever.\n\nI thought in 2001 it was pretty obvious, but it was not obvious to the entertainment business.\n\nDavid Senra\n\nI guess we should give some context. By that time, you had already spent two decades in the entertainment business—longer?\n\nStrauss Zelnick\n\nAbout that. I've been in every entertainment business there is.\n\nDavid Senra\n\nSo why was it obvious to you in 2001 and not obvious to other people in the industry then?\n\nStrauss Zelnick\n\nI was a new-media guy. My goal, getting out of grad school, was to run a movie studio—an old business even when I graduated from grad school. So I got to Columbia Pictures in a very junior job. It was the only job I was offered and, by definition, the best I could get in the entertainment business.\n\nI was responsible for international television distribution, which was basically the last stop on the train of distribution for film and television. In those days, there weren't many outlets. With motion pictures, you went to cinemas, and then you went to the very beginning of home entertainment, the very beginning of pay television, the very beginning of cable television, and eventually free television. My job was to distribute to free television.\n\nNew media had come along to the entertainment business. In those days, believe it or not, new media was home entertainment—which at that time was video cassette distribution—and pay television.\n\nDavid Senra\n\nAnd this is in the '80s?\n\nStrauss Zelnick\n\nThis is in 1983.\n\nDavid Senra\n\nOkay, so that's new media in 1983.\n\nStrauss Zelnick\n\nIt's still used all the time, almost 50 years later.\n\nDavid Senra\n\nAmazingly. Yeah.\n\nStrauss Zelnick\n\nAt big companies like Columbia Pictures, which made their money in film and television production and distribution, they were really old-line companies that were just beginning to modernize. I was one of a small cadre of business-school graduates who had been recruited into the business, which was atypical for the industry until the early '80s.\n\nSo they realized, like, “We need a new-media guy,” the way today everyone needs an AI guy—an AI army. They looked around and said, “Who is the least valuable executive at this company that we can put in charge of new media?” That was me.\n\nIn addition to my day job, I became responsible for new media, which was the best thing that ever happened to me. I'd always been a futurist. My thesis in grad school was a history of the electronic entertainment business from its inception in 1895 until when I graduated in 1983, and I tried to stay current since then.\n\nThe notion of looking ahead came naturally to me, but now I had to do it for my job. I also had to deliver revenue in that job. That was my initial exposure to new media.\n\nIf you look at my career, it has been the combination of traditional businesses and new businesses driven by technology, which is why this is such an exciting time with all things AI.\n\nDavid Senra\n\nI want to interrupt you for one second. Did you say you were a futurist by looking back, though? Did I just hear you say you were studying the history of electronic entertainment?\n\nStrauss Zelnick\n\nYou have to be a futurist by looking back.\n\nDavid Senra\n\nSo, wait. You started back in 1895. What was happening in 1895? What were you studying in addition?\n\nStrauss Zelnick\n\nEntertainment, recorded music, and the beginning of motion pictures.\n\nDavid Senra\n\nThe beginning of recorded music was the phonograph?\n\nStrauss Zelnick\n\nWell, in those days it was a wax cylinder, but you don't really need to know about it. I'll go into it if you want. It was actually a wax cylinder that looks like this. You can see them in museums. That was the beginning of recorded music, along with player pianos.\n\nDavid Senra\n\nI'm more interested in what insights you were deriving from the past and then how you thought you were applying them in the '80s.\n\nStrauss Zelnick\n\nThere are many insights, obviously, and we can go into them one after another. But the insight that spoke to me and probably helped me the most was that you always have to embrace new technologies. If you fight against them, you'll be left behind.\n\nNumber two, and I've said this at all the companies I've been at, most human beings are wired to believe that what is going on now will never change. The actual state of play is that exactly what is going on now will change. It will always change.\n\nFor example, people, whether they like it or not, think today's political environment is what it is. If they like it, they think it's going to stay forever. If they don't like it, they're moaning that it will stay forever. But it won't stay forever. It'll change. The economy will change, and media and entertainment will change.\n\nBecause I've always been wired that way, I was able, when I started ZMC, to make sure we had an idea: Let's not buy legacy businesses that are under pressure. Remember, this is 2001, so it was non-obvious. Let's not go into the movie business. It's a terrible business as a business. It's fun creatively, but as a business, it's a bad business.\n\nLet's not go into deficit network television production. It was just a bad economic business—different today than it was, but it was really bad then. You would deficit-finance these shows in hopes of creating enough episodes that you could syndicate them. If you didn't get there, you had a massive loss. Occasionally, you'd have a huge hit, which was what motivated everyone.\n\nThe economics looked a lot like winning the lottery. I don't win the lottery. How about you?\n\nDavid Senra\n\nYeah.\n\nStrauss Zelnick\n\nThat's not my life experience. But there are many other lessons as well. The biggest lesson, I think, is that new things come along and they can grow. Old things in the media and entertainment business take a really long time to die. Sometimes they don't. Sometimes they stay in the business forever. Sometimes they come back.\n\nDavid Senra\n\nWhat would be an example of that from the '80s, when we're talking about new media and that's what your focus was?\n\nStrauss Zelnick\n\nHome entertainment, which was basically video cassette distribution. That became DVD distribution, which became digital distribution.\n\nDavid Senra\n\nWhich was a tiny market at that time that drastically expanded.\n\nStrauss Zelnick\n\nIt was just beginning to boom in the early '80s.\n\nDavid Senra\n\nAnd you were an early believer in that?\n\nStrauss Zelnick\n\nWell, so much so that I left Columbia Pictures to go to the largest independent home-entertainment company, Vestron.\n\nDavid Senra\n\nOkay, tell me about that.\n\nStrauss Zelnick\n\nI'd been very fortunate at Columbia Pictures. I figured out how to double the division's revenue in 6 months, which was good for my boss's career and therefore good for mine. So I became the youngest vice president of Columbia Pictures.\n\nThen I was recruited. I got a reputation for, “This guy figures stuff out.” I was recruited to a company called Vestron, which was then the largest home-entertainment company and had ambitions to become a diversified entertainment company. That was also my ambition.\n\nI wanted to run a movie studio. Vestron wanted to start a movie studio. So I left to go to Vestron, where, within about 9 months, I became president. I was now president of a public entertainment company, and I was 29, 3 years out of school. It was not my expectation.\n\nThen I had the ability to take on the new movie division, which hadn't actually made any pictures yet. It was very early. I didn't start it, though. I got there and the team was already there, but I gained responsibility for it, and we started making movies.\n\nDavid Senra\n\nGo to the new-media part, though.\n\nStrauss Zelnick\n\nThe biggest part of Vestron's business was home-entertainment distribution, which was video cassette distribution. They would create movies and put them on video cassettes, which you would rent in video stores, as you may recall. They would also ultimately make movies and put them through the entire distribution system.\n\nDavid Senra\n\nWould they buy other content made by other people?\n\nStrauss Zelnick\n\nYes.\n\nDavid Senra\n\nOkay. Yeah, that was actually how the business started. Was that the majority of the business?\n\nStrauss Zelnick\n\nIt was the business when I got there, until they started their own production. Then the idea was, “Okay, we're ready. You've got to do this yourself.”\n\nDavid Senra\n\nIn the same way that Netflix started as a distribution company and realized how to get into production. I've been a Netflix subscriber and never churned, including when they were just mailing me DVDs. That's, I don't know, 20 years or however long.\n\nHow did you get from new media being DVDs and home entertainment to, “Oh, wow, I think I’m going to have a religion on video games, and I want to move myself into that industry?”\n\nStrauss Zelnick\n\nI was not a pioneer in the video game business. The video game business started in the late ’70s and began to grow in the early ’80s. By way of background, I was really a contrarian about video games because Hollywood had a horrible video game experience, which I’m not sure too many people would remember today.\n\nIn 1982, there was a huge hit called E.T. Warner Communications, which was very forward-thinking, had purchased Atari, which at that time was a leading video game company. They made both hardware and software. Software in those days was cartridges, and cartridges were expensive to make and had a long lead time.\n\nBefore you released something, you had to decide how many you were going to sell and order them all. If you were right, you did great, and if you were wrong, you had excess inventory. You didn’t have just-in-time inventory with cartridges. They took too long to create.\n\nWarner’s had Atari, and they were doing well with it. They had E.T., and they thought, “We should make an E.T. game.” Because they didn’t really have a lot of experience in how video games were made, they basically made the game in 5 weeks and put it in the box. It was a terrible game.\n\nThen they manufactured more cartridges than there were Atari consoles. I’m not sure what their idea was, but they did. It was a disaster. No one bought the game because it was terrible, and there are visuals of the cartridges being plowed into a landfill that you can find online today.\n\nThe entertainment business is a small business, and everyone was like, “Oh my God, that nearly tanked Warner Communications.” I think they took a write-down in 1982 of $400 million, which was a lot of money for Warner Communications. So the rest of the business was like, “This is a disaster. Don’t ever get involved with video games. It’s a terrible business.”\n\nOkay, roll the clock forward. I had been at Vestron and made a bunch of hits. The first picture I greenlit turned into a huge hit. That was very good for my career. Sometimes, it’s better to be lucky than smart.\n\nThat got me recruited to become president of 20th Century Fox just a couple of years later, when I was 32. So now I’m at Fox, and we turned around Fox from last place at the box office to first place.\n\nDavid Senra\n\nWho recruited you to Fox?\n\nStrauss Zelnick\n\nJoe Roth, who had been newly named chairman of the studio with the support of Barry Diller and Rupert Murdoch.\n\nDavid Senra\n\nOkay. So what was Barry Diller’s role at Fox at this point?\n\nStrauss Zelnick\n\nCEO of Fox.\n\nDavid Senra\n\nCEO, but then Rupert Murdoch—\n\nStrauss Zelnick\n\nWell, he was the owner.\n\nDavid Senra\n\nYeah, okay. News Corp. owned it. Okay. But this was a flat-out turnaround. The studio part was because they were in last place at the box office, and they weren’t doing well at all. They weren’t making a lot of money.\n\nBut you’re 32?\n\nStrauss Zelnick\n\nYes.\n\nDavid Senra\n\nHow did they identify you as the guy to hire for this?\n\nStrauss Zelnick\n\nIt’s a long, complicated story, so I’ll try to compress it.\n\nDavid Senra\n\nGive me whatever version you want.\n\nStrauss Zelnick\n\nIn those days, imagine the independent business over here, siloed, and the major business here. Never the twain shall meet. Joe Roth was an independent producer, and he had never worked in a major studio. He made movies for Vestron. That’s how I knew him. He made Young Guns and Young Guns II for Vestron, which were hits for us.\n\nHe and I became friendly. First of all, I’m a friendly person, if you don’t know that. Secondly, when I work with people, I want to develop relationships with them. He was a highly creative person and a good guy, so we became friendly—not intimate friends, but friendly.\n\nI was at Vestron for a couple of years, and I was getting very worried about Vestron’s business model for an array of reasons. Vestron’s senior leadership—the person I reported to—\n\nDavid Senra\n\nAnything to do with technology?\n\nStrauss Zelnick\n\nIt had to do with the fact that the reason for Vestron to exist was that they were a pioneer in home entertainment. But everyone else got into home entertainment. You can never have a competitive advantage in the entertainment business through distribution only.\n\nThat’s why Netflix produces content. You can start with distribution only if you’re a pioneer, but you’ve got to immediately go into production, and production is a very tough business, as I said earlier. Vestron wasn’t capitalized to be a diversified film and television production company with a video store division.\n\nIt was apparent to me that they were going to have problems, so I started looking around for a job. Remarkably enough, at the age of 31, people were not exactly lined up, knocking on my door to ask me to be president of a major film studio.\n\nBut Joe got this job as chairman of Fox. Behind the scenes—and I was not aware of this, but I became aware of it—Barry said to Joe, “Look, you’ve never worked at a major, and you’ve never run a business. You’re an independent producer. But I need a creative engine to turn around the studio. You’ve got to hire a business guy to support you here, to be your partner in building the business.”\n\nJoe came from the independent world, which was a totally different world than the major world. He had no relationships in the major world. But in the independent world, I was well-known. I was president of the biggest independent, and we had done really well.\n\nI greenlit Dirty Dancing, which was the highest-grossing independent film of all time then and stayed that way for a very long time. Until—pop quiz: what?\n\nDavid Senra\n\nI don’t know. The Blair Witch Project.\n\nStrauss Zelnick\n\nOh, yeah. Anyway, many years later.\n\nSo he was looking around, thinking, “Who’s the number one guy to be the business guy at the studio?” Now, to say that I was the number one guy—I wasn’t the number 100 guy. I was the number one guy in this little, narrow independent entertainment business.\n\nHe called me up. Actually, I called him to say congratulations. He said, “Is that the only reason you’re calling?” Then he said, “Do you want to come here and work here?”\n\nI was like, “Coincidentally, yes.”\n\nDavid Senra\n\nStrauss Zelnick\n\nHe said, “Do you think you’ll be in LA anytime soon?” I said, “Yeah. How’s Thursday?”\n\nSo we met at the Bel-Air Hotel for breakfast, which was a big thing in those days.\n\nDavid Senra\n\nI’m very familiar with that breakfast.\n\nStrauss Zelnick\n\nYeah. In those days, if you were chairman, you went to Bel-Air for breakfast. If you were president, you went to the Polo Lounge. But anyway, separate issue.\n\nWe met at Bel-Air on a Friday morning because I think I said I was coming Thursday. We had a very nice breakfast. He said, “Do you want to do this thing?” I said, “That sounds pretty interesting.” He said, “Are you free to meet with Barry and Rupert this morning?”\n\nI said, “As it happens, no. I’m a little busy and tied up. I have to rearrange my sock drawer.”\n\nSo I went over to the studio, and I walked into a room with Barry and Rupert. Barry asked the very incisive questions that he does, and Rupert sat rather quietly. I’m not sure he even asked me a question.\n\nDavid Senra\n\nIs that normal for Rupert?\n\nStrauss Zelnick\n\nYeah, he’s a great listener. In those days, he was learning the film business. Remember, I was only going to be responsible for film production and then worldwide film and television home entertainment distribution.\n\nDavid Senra\n\nWhat year are we in?\n\nStrauss Zelnick\n\nThis is 1986.\n\nDavid Senra\n\nWhat was the scope of Rupert Murdoch’s business at this point? Was it just the newspapers?\n\nStrauss Zelnick\n\nIt was News Corp. No, it was a pretty big business at this point. It was worldwide newspapers. That was a lot of it, and then, of course, the Fox assets. That’s pretty much what it was, but it was a big business.\n\nDavid Senra\n\nAll right. So take me back. You’re in a room with Rupert.\n\nStrauss Zelnick\n\nI can visualize it like it was yesterday. Barry asked me these really tough questions, and I left the office. The head of HR walked toward me and said, “Would you like to do this?” I said, “Sure.” I walked into his office and signed the contract. That was how it worked.\n\nDavid Senra\n\nBut did Barry say, “You’re hired,” or did they just—\n\nStrauss Zelnick\n\nNo, I just walked out, and it was like—yeah, the HR guy was like, “Okay, come on.”\n\nDavid Senra\n\nThat was it. It doesn’t happen that way anymore. What did you learn? I just finished reading Barry’s autobiography, which I thought was excellent. You’ve worked with him and known him. What did you learn?\n\nStrauss Zelnick\n\nYeah, it’s good. Let’s be clear: I worked for him. I worked for him for 4 years, and I learned an enormous amount.\n\nI've stayed friendly with him ever since. I have lunch with him a couple of times a year.\n\nDavid Senra\n\nCan you tell me some of the things that you've learned from Barry, or things that you think stand out about him as a person?\n\nStrauss Zelnick\n\nYeah, I learned the entertainment business from him. I learned everything from him because, remember, I knew very little. Thankfully, I knew what I didn't know. To this day, I'm good at knowing what I don't know, and I'm an avid learner. I've never resisted learning more, and I'm comfortable asking questions, including dumb questions. I have to be, because I kept getting thrown into these big jobs much earlier than I should have been.\n\nDavid Senra\n\nHe kind of had that in his career, right?\n\nStrauss Zelnick\n\nHe also innovated more creatively than I did. If I can give myself credit for innovation, it would be more on the business side and less on the creative side.\n\nDavid Senra\n\nIs there anything that you remember—discussions you had or things he told you—that you applied?\n\nStrauss Zelnick\n\nNo, I just remember the form of the discussion, which was a lot of very robust debate with a lot of heat around it. I used to say to people, \"Barry and I argue all the time, and he's right 99% of the time. But 1% of the time, I'm actually right.\" That's how I learned from him.\n\nHe was patient with me most of the time, but you had to have a strong stomach. He was famous and fierce in those days. He was not a junior person; he was already very senior in the industry, never mind what he's done since. He was scary.\n\nAnd, by the way, it wasn't as if, if this job didn't work out at Fox, other people were lining up to hire me. I was young, newly married, had a kid, and had a mortgage. I needed to keep my job, but I understood that this was his dialectic. If you backed down, if you didn't argue, you were done.\n\nI understood it wasn't personal. It just wasn't personal. Other people took it personally, as a personal attack or criticism. I just knew that it wasn't. It's not as if it was personal on the good side, either. It's not as if he were sitting here saying, \"Oh, yes, I love Strauss. I thought he was so amazing.\" He might not even remember I worked for him in those days.\n\nTherefore, I knew it wasn't personal. It wasn't about me. It was about the thing itself. It was about arriving at the right conclusion. I wanted to arrive at the right conclusion, too, and I wanted to learn.\n\nI've had some really bad days with him, don't get me wrong. It was very, very taxing. One of the senior executives at the studio was a woman named Lucy Salhany, who ran television. Lucy and I were very close. We had a so-called president's meeting every Monday, which was Rupert and Barry and all the division heads.\n\nI was in that meeting, and I was 10 or 15 years younger than the next-youngest person in the meeting. I was the one who would argue. I argued all the time. Many other people were just like, \"Shut up and sit there.\"\n\nLucy said, \"You remind me—remember when you were little and you had that blow-up clown doll that everyone had, that you would punch and it would go over and then bounce back up? You remember that?\"\n\nDavid Senra\n\nYes. Everyone had that. I had that. But are you naturally argumentative?\n\nStrauss Zelnick\n\nNo, not at all. I'm much more collaborative.\n\nDavid Senra\n\nI thought so. This is the vibe I get off of you.\n\nStrauss Zelnick\n\nBut that didn't matter. I wasn't in charge. It was his style, and I had to comport with his style to get to the right conclusion.\n\nDavid Senra\n\nWhat are you learning from Rupert at this time? I mean, you're in these weekly meetings with him?\n\nStrauss Zelnick\n\nMm-hmm.\n\nDavid Senra\n\nWith maybe the most successful person in media of all time?\n\nStrauss Zelnick\n\nHe was extraordinary. What I learned from him really was in a different moment. He over-leveraged the company during my tenure there by buying STAR TV, and the company had real trouble with its debt facility. My recollection is they had a diversified debt facility with like 150 banks and a whole cross-default mechanism, which is great when things are going well because it keeps the interest costs low, and horrible if things are going badly because the cost of funds suddenly goes up when things go badly.\n\nHe was at risk of losing the whole thing. I went on a bank roadshow with him for a couple of the visits. What I found remarkable was that he was cool the whole time. He wasn't overconfident; he just wasn't ruffled. He was at risk of losing his whole business, which had been his family's business, and it just didn't faze him. He kept going.\n\nHe was laser-focused on the conclusion, and he reached the conclusion just by being focused and calm. That's really what I learned from him.\n\nDavid Senra\n\nIt's incredible. Okay, so you're 32, and you're doing this turnaround. What are the insights that you're deriving at Fox that you're going to wind up using later on when you do Take-Two?\n\nStrauss Zelnick\n\nThe biggest insight—well, we can get into how I work with creative people, because that's probably the most important long-term thing—but I think, going back to your question about video games, it was now the mid-'80s because I'd been there for a couple of years, and I now really understood the economics of the movie business. Maybe I'm slow to pick it up, but I got it. They're terrible. They have terrible underlying economics.\n\nThey were bad, and they've been bad since 1955, since the consent decree that basically disaggregated distribution from production and turned the motion picture business from a studio system into a boutique system. A rubric for good versus bad entertainment businesses is that a boutique system is generally bad, and a studio system is generally good, or can be good.\n\nThe studio system was long gone. A studio system means your creative talent—all your talent—is on the payroll. In a boutique system, they're not on your payroll; they can auction their services. Obviously, if talented people are auctioning their services for every project, it's going to be much more expensive than if they're on your payroll in success.\n\nSo, essentially, you have a structure in the motion picture business since 1955—it didn't happen overnight in 1955, but by the late '60s, early '70s, and mid-'70s—where it's heads I win, tails you lose. If the project does well, the boutique extracts a lot of the value because of the deal they were able to negotiate so they didn't go across the street. If it's a flop, you as a studio bear the entire cost of the flop, obviously.\n\nIn a studio system, recorded music before its most recent changes was essentially a studio system. Video games to this day are a studio system. In success, you obviously pay your creative people, and we are incredibly generous in the way that we compensate our creative people for success. But the company also has an opportunity to create a return.\n\nI was aware that the economics of the film business were really lousy and that you can't fight that. There was a Buffett aphorism, which I'm going to get wrong, but it was to the effect of: If you take a management team with a reputation for brilliance and a business with a reputation for being bad, it is the business's reputation that will stay intact.\n\nDavid Senra\n\nYeah. And, again, I didn't—that wasn't an elegant version, but you get the idea.\n\nStrauss Zelnick\n\nSo I saw this in Forbes magazine in those days, when you read magazines. It was in the back. Remember, they had quotes in the back of Forbes? I read it and thought, \"That's what I'm dealing with here.\"\n\nI've been really fortunate that I did well because we made hits, and Fox is doing well because we made hits. But you can't fight the underlying structure of the business. My blinding flash of the obvious was that I thought to myself, \"Here's the thing: As it turns out, my ambition had been to run a movie studio. As it turns out, my ambition should have been to run a movie studio in 1927, not a studio in 1991, whatever it is.\"\n\nI thought to myself, \"What is the moral equivalent of the motion picture business in the 1920s?\" Well, that is the video game business.\n\nDavid Senra\n\nHow did you know that?\n\nStrauss Zelnick\n\nBecause I was a student of the business. I was aware that video games were a thing, and I was aware that, despite the issue that Atari and Warner Communications had, it was still a growing business. By the early '90s, it was a real business. It was a small business, but it was a real business.\n\nI looked at it and said, \"I think this is going to be huge.\" Remember, that was a very unpopular view in the entertainment business because of the Atari disaster, which people still saw in bright, flashing neon.\n\nDavid Senra\n\nSo, almost the way you get to what you called in the past the religion on video games is by comparing it to, like, what is the movie studio version of that today? Okay, so your point is about being a student of the business. Then you have that insight.\n\nStrauss Zelnick\n\nYeah. So, now I've been at this studio for nearly 4 years. We've had a great run, and I think I had to go to the video game business.\n\nDavid Senra\n\nWhat's your next move?\n\nStrauss Zelnick\n\nI went to Rupert and said, \"The next big business is the video game business.\" I remember sitting in his office and saying, \"I think we should be in that business.\" He said, \"Great. Go start one.\"\n\nI said, \"Yeah, I'd love to do that while I do my day job,\" which was that I'd been promoted. I was now running the creative and business side, working for then-Peter Chernin, because Joe and Barry had both left. He said, \"Great. You can do it. We'll give you the capital. You can pursue it. Build a video game business.\"\n\nI said, \"Well, the only thing is, I see it as an entrepreneurial venture, so I'd like a piece of it.\" And he said, \"No interest.\"\n\nLike, that's not an offer.\n\nDavid Senra\n\nWhy did he say no?\n\nStrauss Zelnick\n\nBecause Rupert doesn't have partners in his businesses except his public shareholders.\n\nDavid Senra\n\nOkay.\n\nStrauss Zelnick\n\nAnd it's just his approach. There's nothing wrong with that. He didn't pause—it wasn't like he paused and said, \"Oh, let me think about it.\" He was like, \"No.\" So I was like, \"Okay, I guess I have to think about whether I'm serious about this thing.\"\n\nCoincidentally, I got a call from a recruiter saying there was this startup, pre-revenue video game business in Silicon Valley that was doing the most advanced video games. They were really going to be the next generation of video games. They asked if I was interested, and I left.\n\nI took a 95% pay cut and moved my family from our beautiful house in West Los Angeles to Atherton, to a rental house that was going to be torn down. It was maybe a little dated inside. It was about to be torn down for a golf course.\n\nDavid Senra\n\nBecause you wanted equity. You wanted ownership in the company?\n\nStrauss Zelnick\n\nI wanted to build something, and I wanted equity, but primarily what motivated me was this notion of being at the cutting edge of media and entertainment. The fact that it was driven by technology made it even more appealing.\n\nDavid Senra\n\nDid you think that you were always going to be an entrepreneur? Because at this point, if I understand your career, you've always just had jobs. You were a phenomenal operator. You were a business guy, but did you, in your heart, feel like, \"I should be running my own thing. I should be an entrepreneur?\"\n\nStrauss Zelnick\n\nYes. And I wasn't ready, as it turns out. I did think that, and I know I wasn't really a born entrepreneur because I was a good employee and I liked running big businesses for other people. But I also knew that if I really wanted to build something meaningful, I had to take a risk.\n\nDavid Senra\n\nWhy do you say you weren't ready?\n\nStrauss Zelnick\n\nI didn't have much money, and I had a young family. I think there are kind of 2 stages in life to be an entrepreneur: before you have anything and any responsibilities and obligations, and after you have some protection.\n\nI was right in the middle. I had some responsibilities, and I had no protection. Emotionally, it was very challenging for me, and I don't think I was emotionally ready.\n\nI did it for a couple of years. Crystal Dynamics was very successful—not hugely successful, but it still exists today.\n\nDavid Senra\n\nI think I know the story of Crystal Dynamics.\n\nStrauss Zelnick\n\nThat was the company that I founded.\n\nDavid Senra\n\nTell me about the company.\n\nStrauss Zelnick\n\nIt was set up by Kleiner Perkins, which was backing 2 very talented women with backgrounds at Sega at the time. They needed a CEO, and they wanted a CEO from the entertainment business, so they hired me.\n\nDavid Senra\n\nAnd literally, it was a video game studio?\n\nStrauss Zelnick\n\nYeah. I set it up, got them distribution deals, and raised a bunch of capital. I hadn't raised much capital before.\n\nThen I was recruited to turn around a huge record company, back in the days when that was not an oxymoron. I decided I wasn't really ready to be an entrepreneur quite yet, given this opportunity. That record company, which was called BMG, agreed that I could start a video game division inside the company.\n\nDavid Senra\n\nBefore you took the job?\n\nStrauss Zelnick\n\nCorrect.\n\nDavid Senra\n\nOkay, because I was going to say, the jump from—you got religion on video games, and now we're jumping from video games to music. Why'd you do that?\n\nStrauss Zelnick\n\nAnother turnaround. It was really interesting. I'd never done music, and they said I could start a video game company.\n\nDavid Senra\n\nSo, talk about starting the video game company inside of BMG.\n\nStrauss Zelnick\n\nI was going to hire Jay Moses, who's now on the board of Take-Two, and the model was external development—making deals with external developers. We were going to use the BMG recorded-music distribution system to distribute worldwide, which was pretty smart because we had this massive worldwide system of local offices. We could slot right into it without adding any overhead. That was the beauty of doing this.\n\nDavid Senra\n\nSay more about that.\n\nStrauss Zelnick\n\nIn those days, when you distributed records, you actually had to have physical offices to sell physical discs—CDs, at the beginning of CDs and the end of vinyl—to stores. It was very similar to video games at the time because you were buying physical products.\n\nDavid Senra\n\nExactly. You were buying cartridges, and then eventually discs.\n\nWere any of the music companies doing music and video games?\n\nStrauss Zelnick\n\nNo, no.\n\nDavid Senra\n\nOh, that's smart.\n\nStrauss Zelnick\n\nNo. We put aside a small amount of capital for BMG because, in those days, BMG's revenue was, I don't know, $5 billion a year, and it was very profitable. I think we devoted around $40 million to investing in this basket of games, building up the distribution system, and hiring a team.\n\nDavid Senra\n\nCan I pause you there?\n\nStrauss Zelnick\n\nSure.\n\nDavid Senra\n\nAt this point, video games—there's no free-to-play. You can't download anything over the internet, right?\n\nStrauss Zelnick\n\nCorrect. The economics of the video game business were very similar to recorded music. You were buying—\n\nDavid Senra\n\nSomewhere between toys and recorded music.\n\nStrauss Zelnick\n\nIt was a top-10 business, and most of the sales were in the fourth quarter. It had a lot of the aspects of the toy business. There were still cartridges that hadn't shifted entirely over to discs, so you had all the messy inventory characteristics of a cartridge business. It had plenty of hair on it as a business that it no longer has.\n\nDavid Senra\n\nBut did you have any inclination at that time that there would be an end to the cartridge?\n\nStrauss Zelnick\n\nOh, sure. I knew it was becoming a disc business. Absolutely.\n\nDavid Senra\n\nBut you couldn't predict what was going to happen after discs?\n\nStrauss Zelnick\n\nNo.\n\nDavid Senra\n\nOkay. No. So, go back to where we are in the story. Sorry.\n\nStrauss Zelnick\n\nAnyhow, I'm running the record company. That's my day job because it's a big business. Jay is building up the video game company with my oversight, but it's a skunkworks project. It's a tiny little project.\n\nDavid Senra\n\nYou said $40 million compared to revenue of $5 billion. That's like a rounding error.\n\nStrauss Zelnick\n\nExactly. Jay and his team created a whole bunch of properties, and we were getting ready to distribute some of them as they were completed.\n\nThere was a new CEO of Bertelsmann, the parent company of BMG, whose name was Thomas Middelhoff. He decided the video game business was a terrible business and told me to divest the whole thing.\n\nI said, \"Wait. We've already invested. The only thing left to do is distribute the titles. That's the only thing that's left. So let me do that, and then you decide depending on how it goes.\"\n\nHe said, \"No, just sell it to the highest bidder.\"\n\nI said, \"But there won't be any bidders. It's like in-production video games. There's not going to be a lot of appetite for this.\"\n\nHe said, \"I don't care. Just sell it.\"\n\nDavid Senra\n\nWhy?\n\nStrauss Zelnick\n\nHe just didn't believe. He was a person who bet on his gut. It didn't work out very well for him at all, but that's a separate story for another day.\n\nWe went out to market. There weren't a lot of bids, but we found a buyer. The buyer agreed to give us 20% of their company in stock for the business, such as it was. It was a little tiny public company with, I want to say, roughly a $100 million market cap.\n\nSo, $20 million. We closed that deal, and now we owned 20% of this company. I went to Thomas and said, \"Listen, we're $5 billion in revenue. This is $20 million of stock. It's a rounding error on a rounding error. Why don't we just hold the stock and see what happens?\"\n\nHe said, \"Don't sell the stock in the open market.\"\n\nDavid Senra\n\nDid you?\n\nStrauss Zelnick\n\nPrecisely. So we sold the stock in the open market for—wait for it—$14 million.\n\nA month later, this public company launched the first property that we had completed into the market.\n\nDavid Senra\n\nOh, no. Don't tell me.\n\nStrauss Zelnick\n\nThe name of the public company was Take-Two Interactive, and the first release was Grand Theft Auto.\n\nDavid Senra\n\nWe're going to pause right here, though. Grand Theft Auto is the most successful media property of all time. Is that right?\n\nStrauss Zelnick\n\nSo, yeah.\n\nDavid Senra\n\nYeah. Okay.\n\nStrauss Zelnick\n\nOh, my God. All right. So that's my war story on being in the video game business.\n\nNow remember, I'm out of the video game business. I'm running a record company.\n\nDavid Senra\n\nYou had to be pissed off at this time, right?\n\nStrauss Zelnick\n\nI didn't own the company, and I don't get pissed off easily. I understood that I was on the payroll. This is my boss; he gets to make strategic decisions like this. I knew it was a foolish decision.\n\nDavid Senra\n\nBut how could you think that you were going to work—did you? Maybe you didn't. There's no way, if you see this person making decisions like that, that you're like, “Oh, I'm going to work for this person.”\n\nStrauss Zelnick\n\nThat's correct. I did leave. I did leave.\n\nDavid Senra\n\nOkay. So then what happens next?\n\nStrauss Zelnick\n\nI realized it was time to go, and now I was ready to be an entrepreneur because I had a vision for what I wanted to build. I had a few bucks in the bank, so my family wasn't going to starve because I had saved well and made a lot of money as a professional executive. So I decided to start ZMC.\n\nDavid Senra\n\nExplain what ZMC is, though.\n\nStrauss Zelnick\n\nWell, today it's a private equity firm.\n\nDavid Senra\n\nOkay.\n\nStrauss Zelnick\n\nWe raise capital from institutions and funds, and then we buy companies, build them, and eventually sell them to create a return. But at that time, that wasn't the vision. The vision was to create an entity that would build a portfolio of media and entertainment properties supercharged by technology. That was the thesis.\n\nAgain, this was 2001, and I thought it was a pretty obvious thesis. In retrospect, it was not.\n\nDavid Senra\n\nAnd if that is your thesis, then video games are a perfect—\n\nStrauss Zelnick\n\nWell, yes and no, actually. I didn't have an appetite to go back into video games when I started ZMC. First of all, I'd been there and done that twice. Secondly, it was still kind of a top-10, fourth-quarter, toy-ish business with bad inventory characteristics.\n\nDavid Senra\n\nBecause it's 2001.\n\nStrauss Zelnick\n\nYeah, and no. It was cyclical, and the console generation would cause the business to come and go. I wasn't anxious to get back into that business.\n\nDavid Senra\n\nWhat's the first thing you're doing with ZMC? We started buying Take-Two stock?\n\nStrauss Zelnick\n\nNo.\n\nDavid Senra\n\n[laughter]\n\nStrauss Zelnick\n\nI wish. No, we started with direct-marketing companies that were becoming digital and market-research companies that were becoming digital. We turned around a Japanese record company, of all things. Whatever deals we could find—often very, very troubled companies.\n\nBecause remember, we had no capital. Oh, I left that part out: We had no capital.\n\nDavid Senra\n\nSo how do you start a company with no capital?\n\nStrauss Zelnick\n\nExactly. I put in $300,000 of my own money. I convinced people to work for free. We borrowed offices. We had one fewer chair than we had people, and I'm not kidding.\n\nThe offices were so horrible that if you went to the restroom, half the time it was flooding. By flooding, I mean water sheeting down the walls. You couldn't believe this was actually going on.\n\nI would run around and talk to capital providers—professional financial-services firms—and say, “Here's our vision. We're trying to buy companies, build them up, and create value.” They'd say, “Okay, well, show us the company you want to buy. We'll consider putting capital in.”\n\nThen I would go to target companies and say, “I'd like to buy you.” They'd say, “Okay, great. Show us the capital that you have to buy us, and we'll have a conversation.”\n\nThis went on for 6 months, and I thought, “Hmm, there is a problem here.” I had an empty suitcase and was going to a lot of meetings.\n\nIt became obvious to me that there was an issue when we were at this very fancy private equity firm. They said, “You guys are great. You have great resumes. We'd love it if you would bring us a deal, and we'll put money into the deal.”\n\nIt was the end of the day, and we were packing up after they had left the room. There was a cleaning person emptying the garbage, and I said to my colleagues, “I guarantee you that after we leave, someone who works here is going to go to that person and say, ‘Incidentally, if you see a really interesting company, why don't you come talk to us about it? We could both finance it for you.’”\n\nI realized these were empty words. They said it to everyone. They were just looking for free options.\n\nDavid Senra\n\nYeah.\n\nStrauss Zelnick\n\nSo I had to find this lightning in a bottle where there would be an opportunity to buy a company with third-party capital. Thankfully, one came along.\n\nIt was called Columbia Music Entertainment. It was a deeply troubled Japanese record company. I had recorded-music experience. The short story is that, amazingly enough, we turned it around.\n\nDavid Senra\n\nYour idea is to buy, improve, and sell. Correct? You're not—\n\nStrauss Zelnick\n\nForever. We did it. It took us a long time—it took 9 years—but it was very difficult because it was recorded music in the early 2000s, it was Japan, it had a 0.5% market share, it had way too much debt, and it had no hits whatsoever.\n\nDavid Senra\n\nSo wait, how do you—because you're saying the early 2000s. Now you're getting the iPod, you're getting iTunes, and Napster was in 1999. Why would you even—\n\nStrauss Zelnick\n\nIt was the early 2000s, but all of this had happened.\n\nDavid Senra\n\nYeah, exactly. So—\n\nStrauss Zelnick\n\nWhy would I want to be in the record business?\n\nDavid Senra\n\nYes.\n\nStrauss Zelnick\n\nYeah, I didn't want to be in the record business. I was like, “Been there, done that.” I had no interest, and it was a really horrible company.\n\nIt came about because one of the capital providers we spoke to was a company called Ripplewood. There was a partner there named Jeff Hendren, and Columbia Music had been part of a sort of two-part company. Essentially, Ripplewood wanted to own the good part, and they wanted to find some person like me to run the bad part.\n\nI didn't know that entirely, but I wasn't smart enough to figure it out until it was too late. Jeff, who I'd had a couple of meetings with about buying a company together, called me up and said, “Here's a perfect deal for you for your first deal. It's recorded music, which you know. Sure, it's in Japan, and they have a 0.5% market share and altogether too much debt, and probably there are criminals lurking around. But nonetheless.”\n\nI said, “Well, I know the business because I was in the record-music business. It's a horrible company. It's a disaster. Don't do this deal. I'm not doing this deal. Sorry.”\n\nHe said, “Okay.”\n\nA week later, he called me and said, “You know, we're still looking at this business. We really think you ought to look at it seriously with us because you'd be perfect for it and it would be your first deal.”\n\nI said, “Okay, listen. It's a public company, so I'll pull all the public documents and look at them over the weekend.” My partner at the time, Ben Feder, and I spent the weekend poring through the documents.\n\nOn Monday, I called Jeff and said, “It's even worse than I thought. Just run in the other direction. Don't do this deal. It's a disaster.”\n\nHe said, “Okay, thank you.”\n\nHe called me a week later. I promise all of this is exactly how it happened—there's no hyperbole. I can sometimes be accused of hyperbole, but this is not one of those moments.\n\nI remember I was in my dining room, and there was a wall phone. This was a long time ago; it was 2001. He called, and I picked up. He said, “Look, we're going to do this deal, and we really want your firm to take it on and be responsible for building and managing it. Obviously, you're going to get upside in the deal.” They would put up the capital.\n\nI said, “Jeff, look, I told you it was really bad. Then I spent a week looking at it, and it's even worse than I thought. We're passing. You should pass.”\n\nHe said, “Can I ask you a question?”\n\nI said, “Sure.”\n\nHe said, “Just how busy are you?”\n\n[laughter]\n\nI laughed and said, “You make a very good point.” He said, “I think you should do this deal.”\n\nSo we did. It was the hardest deal I've ever done in my life. It was terrible. Terrible. I could literally take 5 hours and tell you every horrible problem this company had.\n\nBut I remembered my experience with Rupert. I became laser-focused on just turning it around and getting to the finish line, no matter what it took. I realized, correctly, that if someone gave me $300 million to take over a company and I failed, that would be my last deal.\n\nThat's true. That's not dramatic. No one's giving you more money after that.\n\nSo, remarkably enough, we turned it around and got about a 22% IRR in the recorded-music business in the early 2000s. That was unheard of.\n\nDavid Senra\n\nThat's insane. And this is the first deal of—\n\nStrauss Zelnick\n\nThat was the first ZMC deal.\n\nDavid Senra\n\nThat's incredible.\n\nStrauss Zelnick\n\nThat's how we began to generate income to build up a team. I reinvested and reinvested, built an enterprise, and bought more companies.\n\nDavid Senra\n\nSo take me to Take-Two.\n\nStrauss Zelnick\n\nAll right. So it's 2007. We started raising our own capital in 2007 and 2008. This was the very end of our time as what was then called a fundless sponsor.\n\nToday, they're called an independent sponsor because it sounds much nicer than “fundless,” but I promise you, we were fundless. Even though we'd done 6 deals at that point, we had very little capital and a very tiny balance sheet.\n\nI'd become, quote, friendly with Carl Icahn. I put it in quotes because he is the man who said, “On Wall Street, if you want a friend, buy a dog.” But in any case, I had a relationship with Carl.\n\nThe relationship took the form of—and I did this intentionally—I would go over and visit with him. He's a lot of fun to spend time with. I'd bring him ideas.\n\nInitially, I brought him an idea for something that we couldn't act on, but he could because he would do public-markets investing. He said, “Listen, I just want you to know I'm happy to listen to your ideas, but I'm not paying you for them.”\n\nI said, “Yeah, I know.” I thought that, if you had a relationship with Carl Icahn, you never knew where it could go.\n\nSo, I’d bring him ideas, and they were good ideas. The first one I brought him was actually Reader’s Digest. I had a feeling something would happen there. It was underpriced.\n\nHe bought, I don’t know, for him, nothing—like $50 million of stock. It immediately went up. I go over to his office about 3 months later and say, “Sell your stock.” He made whatever—for him, nothing. Nonetheless, he likes making money. He made about $50 million.\n\nIncidentally, at the end of it, he said, “You know, I really need to thank you.” He said, “I told you I wasn’t going to pay you.” I said, “Yes, you did.” He said, “But you know what I’d like to do? I’d like to take you and your wife out for dinner.”\n\nSo, thank you. That’s great. Wendy and I go for dinner with him and his wife, Gail. He only went to 2 restaurants in those days: a Japanese restaurant, a Chinese restaurant—I forgot the name of it—and an Italian restaurant called Il Tinello. It was good food, actually.\n\nWendy and Gail and I get there early because he tends to work late in the day. I remember he comes to Il Tinello, and they know him very well. As he’s sitting down, I see the waiter sort of glide over and put a martini in his hand, so it looks like one smooth movement: martini in the hand, sits in the chair, drinks the martini, puts the empty glass down.\n\nThat was how dinner started, and we had a very nice dinner. Carl’s a good storyteller, and he’s a lot of fun. But about halfway into the dinner, my wife leans over to me and says, “Honey, he doesn’t know your name.”\n\nAnyway, Carl then started calling us because I had a team, and he would ask us to research ideas that he had. So, we would research ideas, and I remember my partner Karl Slatoff, who’s still to this day the president of Take-Two, got really annoyed at Carl, who speaks his mind.\n\nI was asking them to do research for Carl Icahn, and Karl said, “He is the richest guy on Wall Street, and we’re doing spec research for him. Oh, and incidentally, he has informed us we will never get paid. What are we doing here?” I said, “You know, I just don’t know, but I feel good about this.”\n\nOne day, Carl calls up and says, “Are you familiar with this video game company called Take-Two Interactive?” I said, “I’m really familiar with it, obviously. It’s a really messy company at this point.”\n\nDavid Senra\n\nYou came to own 20% of it?\n\nStrauss Zelnick\n\nTake-Two is in very bad shape. It’s failing. It’s got very bad management. The chairman had been indicted. It was under investigation. They hadn’t filed financial statements, and it wasn’t even that cheap despite all that.\n\nDavid Senra\n\nWait, the chairman is under indictment?\n\nStrauss Zelnick\n\nYes.\n\nDavid Senra\n\nOkay, they’re being investigated.\n\nStrauss Zelnick\n\nYes, they didn't hold their annual meeting. They’re not filing financial statements. The company is being investigated by a bunch of different—\n\nDavid Senra\n\n4 entities. Okay, 4 different entities.\n\nStrauss Zelnick\n\nYeah: the IRS, the SEC, the New York DA’s office, and the FTC.\n\nDavid Senra\n\nHow much do they have in revenue?\n\nStrauss Zelnick\n\nAbout $700 million in revenue, and they’re losing loads of money. They have no debt, thankfully, and about $50 million in cash. We looked at the numbers and thought, “They’re going to be bankrupt in 6 months. That’s what’s going to happen here.”\n\nDavid Senra\n\nAnd you’re like, “Great.”\n\nStrauss Zelnick\n\nNo, I’m not great. I said, “This is a disaster.” So, we wrote a whole memo and said, “Stay away from it.” I wish I could say I was so forward-thinking. I sent over the memo saying, “This is a disaster. Stay away from it.”\n\nBy the way, I had done video games, but I had no interest. We were doing other stuff that was more tech-driven, and we were doing really well with it. So, he calls up—\n\nDavid Senra\n\nWhat was the market cap of the company back then?\n\nStrauss Zelnick\n\nAbout $700 million.\n\nDavid Senra\n\nSo, it went up 7x from when you had to sell, because it was $100 million when you had 20%?\n\nStrauss Zelnick\n\nOkay. Okay. So, you know, it wasn’t great, frankly, but it was a good growth business, and they had increased the revenue materially. They built a business. It was a business, albeit a very bad one.\n\nSo, he calls a month later and says, “Listen, I have a friend who’s looking at buying a big stake in Take-Two. Can you refresh your memo and do this for the friend?”\n\nAt this point, Carl Icahn loses his mind. His head explodes. He says, “All right, so this was bad before, when we were doing free work for Carl Icahn. Now he’s pimping us out through his Wall Street buddies for free? This is outlandish.” I said, “You just never know where this can go. You never know.”\n\nSo, we do the memo, which essentially says, once again, it’s a mess. Stay away. Again, not being so forward-thinking.\n\nI don’t know how much time goes by. Carl calls me and says, “Listen, this thing, Take-Two—you ever look at this?” I was like, “Yes, I looked into it for you, and then I looked into it for your buddy, and I said, ‘Don’t do it.’”\n\nHe said, “Yeah, yeah, yeah, that thing, Take-Two, it’s really interesting. Have you read the bylaws?” I said, “No, Carl, I’ve not read the bylaws.” He said, “Well, you know what you ought to do? Read the bylaws.” And he hung up.\n\nSo, Ben read the bylaws, and he comes in the next day and says, “Holy—this company has a plain-vanilla, unamended Delaware charter. In this charter, the right exists that if you have 50.1% of the shares vote to fire the board, you can take over the company.”\n\nBecause the company was so troubled, the stock had collapsed into about 20 hedge funds’ hands. So, this was actually mathematically possible. The problem is, you can’t go around and solicit people to vote their stock without creating a group, most likely.\n\nThis is arcane stuff, but we didn’t have any money, so we couldn’t buy stock. We couldn’t go into the market, and we didn’t have the money even to mount a proxy fight, which would be the standard way of going about it. In those days, a proxy fight would cost $3 million. We didn’t have that, particularly because it was totally spread out.\n\nUnder SEC rules, you could solicit up to 10 shareholders without triggering any kind of filing requirement. About 70% of the stock was in the hands of 10 shareholders. So, we put together a deck of what we would do to fix the company, and we went to meet the 10 shareholders, who were happy to meet with us because you’re talking about a position they have in a troubled company.\n\nWe started getting commitments from people who were going to sign the written consent that would give us the company. That’s all you had to do: sign a consent.\n\nSo, we go through this whole process. We’ve now gotten all 10 that we can get to. We can’t go to numbers 11 through 20 legally, and we can’t publicize it either. You can’t market this at all. So, it’s all done quite quietly.\n\nBen comes in and actually says, “We got 48%.” I was like, “Okay, it’s game over. We’re done.” He said, “Well, let me just think about it.”\n\nBen’s a very smart guy. He goes home the next day, comes in, and it turns out there’s another provision in the bylaws. If you show up at the annual meeting, you don’t have to put an item on the agenda in advance, which is unheard of. You can just raise your hand at the meeting and say, “I want to vote.”\n\nIf a majority of the shareholders vote in favor of your slate, you can take over the company at the meeting, which is unheard of. It just doesn’t exist, but it did exist here.\n\nIt’s not 51% of the people who show up at the meeting. It’s 51% of the votes in the meeting, but you have to be there physically. You cannot vote by proxy because, remember, we didn’t file a proxy, and we couldn’t solicit anyone.\n\nWhat we did do was go back to those 10 people and say, “Look, do you want to form a group with us now so we can actually talk and reach an agreement, show up at the annual meeting, and vote for us?” We thought we could win that way, even though we only had 48%, because we knew not 100% of the shares would show at the meeting.\n\nThat’s what we planned to do, and we got a lot of support—or so we thought. We thought. Until it was very close to the meeting they had scheduled, we formed a group. We now announce that we’re doing this and indicate it to the company weeks before the meeting.\n\nThe company—not a professionally managed company, to say the least, and not a good board, to say the least—really didn’t even know what to make of this. They’d never seen it before. They didn’t understand it. They had bad counsel. They just had no idea what to do.\n\nWe were thinking, “We have 48%. We think that’s pretty good. If 75% of the shares are at the meeting, we’re probably good.”\n\nThen we found out that these hedge funds had loaned out their stock to short sellers, as one does. If you do that, you can’t vote the shares. And we couldn’t solicit anyone, remember. We had solicited our 10.\n\nI said to Ben, “So, what percentage do we have?” He said, “You’re not going to like this: 22%.” I was like, “Hmm.”\n\nSo, we had to disclose that. We had prior disclosure of the group, which was at 48%, and we went to the meeting. We physically went to the meeting.\n\nAt this point, there had been a journal article because no one had seen this before, and there were television cameras out front. We were at the meeting, walking into the meeting in a hotel. We’d hired the 2 top proxy solicitors just to protect us, and we’d been smart about the people we hired. We spent a lot of money for us on fees because we had to.\n\nBefore it starts, a guy waves across the room. I go over, and he says, “Hey, I haven’t seen you since law school. It’s great to see you. How are you doing? How’s your family?” We talked for about 5 minutes.\n\nI go back and say to my proxy solicitors, “Who was that guy?” They said, “He’s Fidelity.”\n\nFidelity was a larger shareholder, but they had declined to participate in our group.\n\nSo, we had no idea where they would vote. Fidelity doesn't typically support anything hostile; they typically support management. So, I looked at my proxy solicitors and I said, “We just won.”\n\nThe company had a new general counsel. We had a room in the hotel, and the company had a room in the hotel. Incidentally, the CEO of the company declined to attend the meeting. That gives you a sense of what we were dealing with here. This was a Thursday, by the way.\n\nThe general counsel comes into the meeting room that we're in and says, “Well, we don't have the final vote, but we have a provisional vote. You have 88%.” He said, “So, will you accept that, or do you want us to keep counting?” I said, “We'll accept that.” [Laughter]\n\nThe next morning, Friday morning, I walked into the company and walked into the corner office and became chairman of the company.\n\nDavid Senra\n\nWhat year was that?\n\nStrauss Zelnick\n\nThat was 2007.\n\nDavid Senra\n\nAnd you're still running it?\n\nStrauss Zelnick\n\nI'm chairman now; I'm CEO. Ben was the CEO from 2007 to 2011, then he decided to leave and I became the CEO.\n\nDavid Senra\n\nSo, this is what you described as basically a hostile takeover with no capital.\n\nStrauss Zelnick\n\nYeah.\n\nDavid Senra\n\nSo, now you come in. You went from writing this memo to Carl Icahn saying, “Stay away from this,” to “We just took over the company.” What was your plan?\n\nStrauss Zelnick\n\nThe plan was that there was only 1 good property, GTA, which was in development and we thought was soon to be released. It ended up getting delayed. Everything else was a total mess, except the NBA franchise, which was really tiny; it was making a tiny amount of money. Everything else was losing money. So, our plan was to meaningfully cut costs, run a rational company, be friendly to creative talent, diversify the product pipeline, and build an entertainment company.\n\nDavid Senra\n\nDid I hear correctly that you cut something like $40 million to $50 million?\n\nStrauss Zelnick\n\nYeah, we cut about $40 million.\n\nDavid Senra\n\nExplain how you did this.\n\nStrauss Zelnick\n\nWell, we have an approach. When you're doing turnarounds, you have to cut costs, but our approach is a little different: we don't want to show up and fire people. It's a great way to build ill will. Also, you don't know anything when you show up, so you might fire the wrong people. And who knows? Maybe you need everyone—you just don't know.\n\nWe have a rule: we only do turnarounds if we're the first team in. You know why? We're not so smart. Smart people all do the same things. So, if someone came in before us to do a turnaround and failed, guess what? They probably did all the stuff that we would end up doing, and they still failed. That's not for us. But we were the first team in.\n\nIf you're the first team in, the first thing we look at is third-party expenses. Every company, particularly a big company, has deals with third parties. This was back in the days when you put discs and cartridges in boxes. So, we had a printing deal, a cardboard deal, and a pressing deal for our discs.\n\nWe do a top-10 vendor survey: all the top 10 vendors and how much we spend with each. Then we call them all up and negotiate them down. The reason we do that is, number 1, you immediately save money. Number 2, you don't scare or upset the team. Number 3, you begin to create credibility with the team because the team's like, “Wow, they just saved all this money and no one got fired. That's pretty good.”\n\nWe also don't do things like put in new expense policies. That is a great way to alienate everyone. Or let's say, “David, let me see your expense report. Why did you have lunch at McDonald's on Tuesday with Mike? Why?” That's a great way to alienate David. And if David has another option, he's going to leave the next day. So, we don't do that either.\n\nBut our top-10 vendor approach saves a lot of money. Then, about 3 to 6 months in, when we know what's going on, we have to right-size the overhead. In most instances, of course, sadly, you have to cut some headcount.\n\nDavid Senra\n\nYeah, especially at a company like this. How much money was GTA making back then?\n\nStrauss Zelnick\n\nWhen GTA released, the company would have a meaningful profit, like $100 million or so a year. But it only released every 4 years, so they lost money the rest of the time.\n\nDavid Senra\n\nOkay, so what was your plan for that?\n\nStrauss Zelnick\n\nMake other hit titles.\n\nDavid Senra\n\nThis goes back to your insight, because I don't even know if we were explicit about this enough, but when you were a kid, you were like, “I want to run a movie studio,” right?\n\nStrauss Zelnick\n\nYeah.\n\nDavid Senra\n\nAnd then 20 years into your career, you're like, “No, I want to run a movie studio in 1926, not 1987 or whatever.”\n\nAnd here we are. So then you took that idea and you're like, “We're going to build a movie studio and it's going to be great.”\n\nStrauss Zelnick\n\nHow do we do it? We're going to try to be the most creative, the most innovative, and the most efficient company in the business, which was the same rubric I used at every entertainment company I ever ran. When I told that story, because Take-Two is public, I had to tell the story. I remember investors saying, “How does that plan differ from your plan when you were at Fox?” I said, “It doesn't. It's the same plan. It's the entertainment business.”\n\nAnd we have found that that rubric, which we use to this day, if you're honest and if you're true to the rubric, if your decision-making supports the rubric, tends to work. You take over the company; the market cap was $700 million, whatever. Today it's $30 billion, whatever. $35-ish.\n\nDavid Senra\n\nThat's an insane run, by the way. That's absolutely incredible.\n\nStrauss Zelnick\n\nThank you. Great team.\n\nDavid Senra\n\nSo, can you explain the ideas that you were putting into place? Was anybody even thinking about taking ideas from building movie studios in the 1920s to video games in the early 2000s?\n\nStrauss Zelnick\n\nIt isn't what people thought. What people thought about there was making a great video game. That's what they had to think about.\n\nDavid Senra\n\nNo, I meant you. Were you thinking that?\n\nStrauss Zelnick\n\nNo, yeah. Were any other people doing that? I was doing that.\n\nDavid Senra\n\nYeah, like you were applying this idea.\n\nStrauss Zelnick\n\nNo, but I mean, I'm not sure that that idea informed what we did day-to-day. There were some great executives who built great companies at EA and Activision, among others. And certainly, I don't feel like I had any kind of monopoly on figuring this out. It took us a long time to turn the company around, and we had some meaningful missteps. We have not created more value than anyone else in the business. I would argue that, for a pure play, Bobby Kotick probably has with Activision.\n\nDavid Senra\n\nSo, what were these missteps?\n\nStrauss Zelnick\n\nOh, I mean, they're daily. I'm probably making one right now.\n\nDavid Senra\n\nNo, but what were the big ones back at the very beginning?\n\nStrauss Zelnick\n\nAt the beginning, we didn't make too many mistakes. How could you? When you're on the floor, there's nowhere to fall. This was a terrible company, terribly run. Every decision they made was horrible. It was very easy to make sound decisions.\n\nDavid Senra\n\nYeah, this is something I thought was interesting that I heard you say: your pitch to talent was—well, I think anybody who's successful has some form of ego, but you're willing to put yours aside. You said something like, “In the entertainment business, the only people that matter are you. I don't matter; it's the people that make the hits that matter.”\n\nWhich is a very interesting thing to say. It also had the added benefit of being true.\n\nStrauss Zelnick\n\nYeah. You can replace people like me. You can't replace the hitmakers.\n\nDavid Senra\n\nBut what's fascinating to me is your pitch to them is just like, “I'm just going to run a rational organization.” You've used the phrase “rational organization” at least once in this conversation. I've heard you say it before, too. The pitch is, “We're just not going to do anything crazy.” Over a long period of time, that is an edge. Can you talk about that?\n\nStrauss Zelnick\n\nThat was sort of a nice-to-have, but the must-have was: we are going to give you the creative and financial resources to pursue your passion. We're not going to interfere creatively. We want you to make the best video games on Earth. That was the pitch, and we mean it. And we will support you through thick and thin to do so, more than any other company.\n\nOh, and by the way, then we'll run a rational business organization. No one's going to scream at you. You're not going to find out that someone's getting indicted. We're not going to get sideways with the FTC. It'll be like a real grown-up company.\n\nOver time, I couldn't promise this right away, but I had to promise it. I said, “We'll also have a solid balance sheet so that when we fail—inevitably, you fail in the entertainment business—we can live to play another day.” That took us a few years.\n\nDavid Senra\n\nThese super-talented people also tend to be highly disagreeable and somewhat erratic. I find it interesting that you kind of balance their—you say you're not talented, which obviously means your talents are different. You're very talented, but I think you mean in a creative way, like you're not the one who can create the video games.\n\nNot in the least. How do you deal with these very disagreeable, talented geniuses?\n\nStrauss Zelnick\n\nI love them.\n\nDavid Senra\n\n[Laughter.] I'm serious. Okay, then you have to say more about that. I mean, you have to sincerely care about other people to be an effective leader.\n\nStrauss Zelnick\n\nI sincerely care about my colleagues, genuinely. I don't love every attribute of every one of them, and I don't love every conversation we have. But they don't love every attribute of me. I just did a 360, and I found that out—not that it came as a surprise.\n\nWe care about one another, and I want the best for them and for the organization. I treat everyone with respect, and I demand that everyone do the same thing. There's no yelling at the company. There's no bad behavior. If you engage in bad behavior, you have to leave.\n\nOne of our competitors at one point had 500 sexual-harassment claims at their company.\n\nDavid Senra\n\nFrom one guy?\n\nStrauss Zelnick\n\nNo, no. Unfortunately, it was broadly distributed. We don't have claims like that. We've had, obviously, a few things here and there, but we don't have claims like that.\n\nWe treat people with respect. People can come as they are. We don't care about your ethnic background, your religious background, your orientation, your lifestyle, or the color of your hair. Just do great work, seek excellence, and be kind to others.\n\nBy the way, I've had plenty of hard conversations—super-hard conversations. You said it earlier, and I think I learned this with Barry Diller: I still take it personally. It's not personal.\n\nI never say the words that executives use with me, like, “We're a big family here.” We're not a big family here. This is an enterprise. My family's at home. We don't have all the angst around being a family. However, we are an enterprise that treats people with respect.\n\nIf someone is offsides with me and they misbehave, I don't see myself as so important that they can't do that. I don't feel the need to teach everyone all the time. I had to learn the hard way: the Delete key is there for a reason.\n\nI had one creative person who isn't with us any longer because it just got to be too much, and the value delivered wasn't worth it, to say the least. He used to send the most outlandish and unpleasant emails. I remember saying to someone, maybe a board member or something, “This is really tough because the lack of decorum is so outlandish that at some point he's going to do or say something where I just have no choice but to fire him.”\n\nThen I realized, “Wait a second. I always have a choice.” You know what the choice is? Delete. I just started deleting his emails. I hadn't seen the first—\n\nDavid Senra\n\nOh, I thought you meant delete him as a person.\n\nStrauss Zelnick\n\nNo, delete his emails. I was like, “How can I be offended if I delete them?” I just delete them.\n\nDavid Senra\n\nWithout reading them?\n\nStrauss Zelnick\n\nAbsolutely. If I read them, they'd upset me.\n\nDavid Senra\n\n[Laughter.]\n\nStrauss Zelnick\n\nEventually, he had to go because it was just too bad. But I put up with it for a long time.\n\nDavid Senra\n\nI find this very interesting. Just being completely rational over a long period of time can actually give you an edge in business.\n\nStrauss Zelnick\n\nWell, in the entertainment business, particularly.\n\nDavid Senra\n\nI think in all businesses. I mean, this is something Munger and Buffett—you mentioned Buffett earlier. I'm obsessed with them. That was one of Munger's whole things: just be able to be rational over long periods of time.\n\nStrauss Zelnick\n\nYeah. We don't engage in magical thinking, which is hard not to do in the entertainment business. Magical thinking is, “Because I want it, it's going to happen,” right?\n\nMagical thinking is, “I don't know, someone's going to see this podcast and they're going to call me up and say, ‘We need to give you $10 to do X.’” Like, that's magical thinking. “That's very likely going to happen. I'll give you a call. I'll give you 10%.” That's magical thinking.\n\nDavid Senra\n\nThat's what Brad Jacobs gave me. Brad Jacobs was Episode 3. We all went to his house. This guy is laughing. He's like, “I love David.” He goes, “I raised $750 million out of his audience, and I had to pay him a fee.” He slapped his knee, and I was like, “That's not funny.”\n\nStrauss Zelnick\n\n[Laughter.]\n\nDavid Senra\n\nBut I got dinner with Carla.\n\nStrauss Zelnick\n\nAnd then he goes, “You got to dinner,” and then you found out he didn't even know your name. Then he puts you to work.\n\nSo the starting point is not that we run a rational organization. The starting point is that we will support your creative activities through thick and thin. That gets tested, and it gets tested at the worst possible time.\n\nI like to say, “Culture, like character, is tested in the breach.” You're not tested when things are going well. Great, we just delivered a hit. We're making all this money. This is awesome. Have a celebration. That's not a test.\n\nThe test is when someone comes into your office—and this happened to me—and we had not turned around the company and had very limited capital. We were developing a game, and it was about to be released 2 months later, which is to say, it was done. We had spent a lot of money.\n\nThe head of the division came into my office and said, “Look, we just don't think this is good enough. We think we screwed up, and the art style is not appropriate and it's not differentiated. So we want to remake the game.”\n\nI was like, “Well, what does that mean?” This was a long time ago, so it's slightly different. He said, “It means $50 million of incremental development costs. It's a lot of money to us, and another year.” It was on a release schedule that we hadn't announced.\n\nI dug in. I don't give knee-jerk answers. I did my homework, and in the end, I supported the decision. That title became Borderlands. Had we not done that, Borderlands wouldn't have been a hit.\n\nDavid Senra\n\nYeah, it's a huge game now.\n\nStrauss Zelnick\n\nThat was a non-obvious decision, and I can pretty much assure you no one else in the business would have done it. Why? Because it was insane. They would have said, “The game is done. Put out the game. Move on to the next thing. I'm not spending $50 million to remake the goddamn thing in another art style, and I have no evidence that it wouldn't work either.”\n\nDavid Senra\n\nSo you just trusted the intuition of the talent?\n\nStrauss Zelnick\n\nI had to. That's the story. Be the most creative, be the most innovative, be the most efficient. I hired the most creative people. I said, “You have to pursue your passions. We will support you.” They came and said, “This is our assessment. This is our passion. Are you going to support us?” And I said, “Yes.”\n\nDavid Senra\n\nThe timeline's slipping because you're sitting on the most valuable media property in the world. Everybody online is just like, “When's GTA 6 coming out?”\n\nStrauss Zelnick\n\nYeah.\n\nDavid Senra\n\nHow do you deal with the timelines? It's just like, the answer to that question is, “I don't know,” right?\n\nStrauss Zelnick\n\nWell, no, no. November 19th, I do know.\n\nDavid Senra\n\nOh, okay. No, it's been announced. But this has been pushed back, I think, twice. For how many years?\n\nStrauss Zelnick\n\nI think we're about 18 months behind the original date. Not much more than that.\n\nDavid Senra\n\nIs it the most successful video game of all time?\n\nStrauss Zelnick\n\nI think so, but it depends on how you count. If you count just revenue, I think so. If you count every Mario Kart and Call of Duty and a bunch of others, it's not entirely clear.\n\nBut I think in terms of the value of the intellectual property, most people believe it's the most valuable entertainment IP ever created. People could argue about that.\n\nDavid Senra\n\nAnd you don't disclose the revenue for GTA 5, correct?\n\nStrauss Zelnick\n\nNot the total revenue. It's a lot.\n\nDavid Senra\n\n[Laughter.]\n\nStrauss Zelnick\n\nThe reason people keep playing is because it's constantly updated and it's really good. The most recent content pack was awesome.\n\nDavid Senra\n\nAnd they like the social element, too—they can catch up. You can actually talk, connect, and play together. It's amazing that people don't realize that online games are highly social experiences. Especially when you see this with kids now, with Roblox and everything else.\n\nStrauss Zelnick\n\nWell, it's everything. My mom is 90. She plays bridge online.\n\nDavid Senra\n\nWith Buffett? Sorry—with Buffett? Warren Buffett?\n\nStrauss Zelnick\n\n[Laughter.] Somehow I doubt that. She's good, though. She has bridge friends who she's never met in person.\n\nShe gets around. She's mobile, but she doesn't get around the way she used to. This is an enhancement of her life. It's a social life, and it's something she's good at and loves doing. She's 90.\n\nThis is an industry that speaks to little kids and people of all ages. Gaming is enduring. We've played games since the dawn of humanity. We figured out games to play with each other.\n\nThere was something you said earlier that I want to pull out from your book.\n\nDavid Senra\n\nYou said, “I don’t believe in magical thinking.” I don’t think visualization is magical thinking, but you do talk about being very, very particular. The note I left myself when I got to this section of the book is that the universe rewards the specific ask and punishes the vague wish.\n\nYour point was—and that does sound a little magical, but you have to dig into it—that creative visualization, which people think is some woo-woo, foo-foo thing, can be effective. I’ve read 415 biographies now of history’s greatest entrepreneurs. I’ve kept every single note, every single highlight, and every single transcript of anything I’ve done for that project, which I’ve been working on for a decade, in this giant searchable database. Visualization comes up all the time, and these are not woo-woo, foo-foo people.\n\nStrauss Zelnick\n\nNo.\n\nDavid Senra\n\nI love what you said about why it might be effective. You said, “I’m pretty sure it works because the method requires one to concentrate hard, exclusively, and frequently on what one wants.” Can you say a little bit about that?\n\nStrauss Zelnick\n\nSure. I think, having not done as much research as you but having read a billion biographies, I was very focused growing up on success—traditional success, but also political success. I tried to drill it down to: What is the factor that is most common among highly successful people? The only thing I could come up with was that they knew what they wanted.\n\nIt’s not because you know what you want and, as Napoleon Hill says, write it on your mirror: “I want a million dollars on Thursday.” It’s because I wanted to build a diversified collection of media, communications, and entertainment assets supercharged by technology, starting in 2001, and I’ve been laser-focused on it ever since. That means I make choices that are in service of that.\n\nMagical thinking is, “I want to do that, but you know what? It’s a very nice day out there. I’m going to the beach today, tomorrow, and the next day.” You just told me you’re a reasonably successful guy, I think. You just told me you work 7 days a week. I have 3 jobs. I work really hard. Why? Because I have a set of goals, and I’m focused on achieving those goals.\n\nThere’s still no guarantee. But by knowing what you want and working in service of what you want, you are much more likely to get what you want than if you don’t know what you want or work in service of that thing. That’s the truth.\n\nWhen I started ZMC, I thought, “I want to build, I don’t know, a $20 billion company that looks like this.” It was out of the blue, and I can’t explain it. It wasn’t like I ran around and was talking to people as I was endlessly and vainly trying to raise capital or find companies, and they were saying, “This is awesome. You’re doing great. Who’s better than you?” People were saying, “This is a crazy idea. This is crazy.”\n\nBut I looked at it and said, “I don’t think it’s so crazy. I think it’s possible, and even if I fall short, I’ll probably get closer than if I don’t try.” I was okay with that. I’ve said this publicly: After 10 years, I was speaking at MIT. Remember, I wanted to build a $20 billion company, and one of the students said, “How big is your company now?”\n\nI said, “Well, if you take everything together, I don’t know. It’s about a billion-dollar company.”\n\nHe said, “Are you deeply disappointed?”\n\nDavid Senra\n\n[Laughter]\n\nStrauss Zelnick\n\nI said, “Well, I was. I really appreciated the question. Look, it isn’t what I set out to do yet, but you know what? We’re directionally correct, and I’m not stopping. If this is as good as it gets, at least I tried, and we made a little progress. We did okay.”\n\nToday, our company, taken as a whole and in terms of our market cap, is a $40 billion company. We kind of exceeded our goals, and we’re not done yet. But we wouldn’t have done that if we didn’t know what we were trying to achieve.\n\nToday, Take-Two has this, and I advocate it for every enterprise. The mission of Take-Two is to be the number-one entertainment company on Earth. That’s a pretty bold idea, but everyone understands it. The strategy to get there is to be the most creative, the most innovative, and the most efficient. Remember I said that earlier. The culture in which we work is one of seeking excellence, working together as a team, and being kind. Remember that from before.\n\nThere are 14,000 people at Take-Two. There’s not one person who can’t tell you that. It’s simple, it’s straightforward, and it has the added benefit of being true.\n\nDavid Senra\n\nThis is why I asked you before we started recording if you minded if I did an episode on your book for my other podcast. I want to read this because I think it’s really important. People have asked me before, “What’s the most important thing you’ve learned from this crazy, decade-long study of history?”\n\nBecause you’ve done centuries of it. If I had to put it in one word, it would be focus. They’re just unbelievably focused, almost like a different species in terms of how they can concentrate.\n\nI want to read the part I just read. It says, “I’m pretty sure it works because the method requires one to concentrate hard, exclusively, and frequently on what one wants.” Then you end this chapter with another great sentence:\n\n“The most important thing you can do to achieve the success you desire is to discover your ambition, narrow its scope with as great a degree of specificity as possible, and blazon it on your consciousness, and revisit it daily.”\n\nThat is visualization. It’s just not magical visualization.\n\nI was on a Zoom call with one of my colleagues because I’m reachable by everyone. If people email me, text me, or Slack me, I respond. I’d been doing a town hall in our office in Austin, and this woman Slacked me afterward. She was a brand-new colleague, and she said, “Can I have a chat with you about my career?”\n\nI said, “Sure.” We were chatting, and she was really impressive. I was quite taken with her. At the end of the call, she said, “What should I do to succeed around here?”\n\nI said, “Well, you need to know what you want. Then you need to show up on Monday and think about how you’re going to create more value than you cost. On Friday, think about, ‘Did I create more value than I cost?’ Because if you’re here for a year and you get paid $100 plus $25 in benefits, and you generated $10 in value for this enterprise, one of two things will happen: Either you’re going to lose your job, or this company will fail. If you want to succeed and you want the company to succeed, you’ve got to create more value than what you cost.”\n\nI said, “Think about that.” She’d already decided what she wanted. She wants to be CEO, which is great—terrific. Then I said, “Come to work, don’t have political exchanges, put a smile on your face, say yes, and you’re going to be fine.”\n\nAre you surprised? First of all, I’ve heard you say this, and you’re like this with me. When we were at lunch, I said, “Hey, do you have a team I need to go through to schedule the podcast?”\n\nYou said, “No, we’re going to do it together. Just text me.” And you respond. Are you surprised by how few people take you up on this—the fact that you will respond to emails or messages?\n\nStrauss Zelnick\n\nNo. Here’s what surprises me, and this part I don’t get. I spend 20% to 25% of my time mentoring and coaching people—\n\nDavid Senra\n\nWhich I want to talk about, yeah.\n\nStrauss Zelnick\n\n—using the tools in the book. As you saw in the book, some of them are exercises. You have to do the work to get the benefit.\n\nSomeone will reach out to me, and while I’m easy to get to, you still have to do some homework. I like having an assistant who schedules me, so there’s a bit of a process to have a meeting with me. It’s not like, “Hey, come on in tomorrow at 9:00.”\n\nI’m amazed that people will come in with a specific ask for something that would affect their life. We spend time on it, we talk about it, and maybe I assign them one of the exercises in the book. I usually do. I would say about half the time, they never follow up.\n\nThat, to me, is kind of astonishing. I don’t think it’s because I’m a horrible person, or I’m scary, or something. I think there are people who believe, “If I can just get into a room with that really successful person, they can just wave a magic wand, and I will have success.”\n\nThat’s sort of my point earlier: Someone’s going to listen to the podcast, and I’m going to win the lottery. It doesn’t work that way.\n\nOne of the things I understood about starting ZMC is—look, I’ve been around the block. I don’t think I have an enemy in the business. I know everyone, I like everyone, most people like me, and I think, candidly, I have a very good reputation. Nonetheless, I think people confuse that with somehow having a shortcut.\n\nI had the attributes I just described. Lots of people wanted to help me when I started ZMC. The conclusion I arrived at was: No one can. They would love to. I had all kinds of goodwill. What could they do for me?\n\nI had to run out and find the deals. I had to go see Carl Icahn. I had to hire a team, pay the team out of my pocket, and manage the team.\n\nDavid Senra\n\nThink of the story you told earlier, when you were recruited to 20th Century Fox. I have a maxim that appears in these biographies. It just gets explained as, like, “Opportunity handled well leads to more opportunity.”\n\nRight. You had to handle the opportunity at Vestron. How do I say the company name? Vestron.\n\nYou had to handle Vestron first for this guy to say, “Hey, I need some help now.” And the whole thing is—that’s why he’s like, “Whatever. This is, again, from Munger.” They say they believe in Carlyle’s prescription, which is: do the best possible job on the opportunity you have in front of you. And then you don’t have to worry about the opportunity that it will unlock future opportunities.\n\nStrauss Zelnick\n\nOr it may not, but it’s the best that you can do. What else would you be doing, anyway?\n\nDavid Senra\n\nDo anything better? But you said earlier, when you were on my friend Patrick’s podcast, I think you mentioned this book. You were like, “How few people—this book is not for sale. You can’t buy it, but you give it out.” Even then, hundreds of thousands of people heard that, and you were like, “50 people asked for it.”\n\nStrauss Zelnick\n\nYeah. That’s insane to me. I think it’s tied to what we were talking about earlier. You have this edge where you can just run a rational organization over a long period of time. You also understand, I think, that time carries most of the weight. Think about the compounding you’ve done in the last 25 years, from $750 million to $40 billion.\n\nIt’s just like, “I’m going to apply this rational approach. I’m in a good business. There are technology tailwinds here, and I’m going to apply this rational organization, working with the best people possible.” The score takes care of itself over multiple decades. You said you wanted to do $20 billion. Well, you’ve doubled that, and you’ll probably keep going.\n\nDavid Senra\n\nThat’s the goal. Let’s go back to the talent and how you serve the talent, because when I hear the conversation we had, the book I’ve read, and interviews I’ve heard with you, you seem to be very comfortable—almost like you’re in the service business. Is that a way that you think about this, or not?\n\nStrauss Zelnick\n\nYeah, I think a good CEO needs to serve his or her team. No work gets done in the CEO’s office. So what do you really do? You agree on the mission, you set the strategy, you agree on the culture, and then you drive daily execution—but you’re driving that daily execution through other people.\n\nHow do you do that? You have to motivate them. You obviously have to stay informed so you know what’s happening, and then you have to motivate them. On the very rare occasion that a problem can’t get solved below my level, you have to solve the problem. On the rare occasion that a decision about an approach or capital allocation isn’t obvious, or is above someone’s approval level, it comes to me.\n\nI’m not writing memos. I’m not doing Excel spreadsheets.\n\nDavid Senra\n\nAnd are you adapting your style to each individual talent?\n\nStrauss Zelnick\n\nOf course. I’m true to who I am, but of course.\n\nDavid Senra\n\nOkay, so we had the same experience: some of these books are great, and the titles are terrible. Like, How to Win Friends and Influence People?\n\nStrauss Zelnick\n\nLike How to Be the Most Popular Boy in the Class.\n\nDavid Senra\n\nIt’s just like—yeah. So many people told me about that book. I didn’t read it because the title was terrible. But you almost saved me the need to read How to Win Friends and Influence People. Your whole thing is: take a sincere interest—with an emphasis on the word “sincere”—in other people.\n\nStrauss Zelnick\n\nRight. That is really the story of the book.\n\nDavid Senra\n\nThat is really a book on sales and leadership.\n\nStrauss Zelnick\n\nYep. And friendship.\n\nDavid Senra\n\nSo explain how you would apply that inside your own work.\n\nStrauss Zelnick\n\nWell, I just did a 360, and there was criticism in it, to be clear. But one of the positive attributes—and there were plenty of those, too—that were noted was, “When he sits with you, he really, really cares about you.” He sits with anyone at any level in the organization. He responds to everyone. He’s kind to everyone. You think you’re the only person in the room when he’s talking to you.\n\nYou asked me how I deal with difficult creative personalities. I say, “Because I love them. I care about them.” I genuinely care about them, and I care about my executive team. I care about everyone who works at the business.\n\nFrankly, I care—you’re going to find this hard to believe, but it sounds self-serving. I really don’t mean it that way. I think it’s table stakes of humanity. I care about the person behind the counter at Starbucks enough to say hello, ask them how their day is going, and interact with them a bit if they’re not busy—if they’re not pouring coffee, which sometimes they are—to see if maybe I can brighten their day a little bit. Why wouldn’t I?\n\nThere’s a great story in Dale Carnegie’s book. He says, “I had an idea. When I went into the post office, I wanted to brighten the day of the guy behind the counter.” He was struggling with what he could say, because this really was an exercise for him. He got to the front of the counter, and the postman behind the counter apparently had a great head of hair. So Dale Carnegie said, “You have a great head of hair. I wish I had a head of hair like that.”\n\nThe guy said, “Oh, thank you, because I’m actually kind of proud of my hair.” That little interchange—and Dale was telling the story to a friend, and the friend said, “Well, Dale, what did you get out of that?” And he said, “What did I get out of it? Are we so small-minded that we need to get something out of every interaction? How about that I improved that person’s day, and it improved my day? How about that?”\n\nIf you’re taking that position as a starting point—look, if you’re taking a position like, “I’m here doing this podcast. Here’s my goal: My goal is to look awesome on your podcast,” that’s a very bad approach. My goal is, when I show up, to have some engagement like this. How can I be of service to David and to his audience? That’s what I’m thinking.\n\nOne of my favorite quotes ever comes from Henry Ford. He says, “Money comes naturally as a result of service.” And I think part of what we’re trying to do here is—this whole show is essentially a love letter to capitalism.\n\nDavid Senra\n\nAnd the reason I say that—or it’s apocryphal, not clear—is: “Whether you think you can or you think you can’t, you’re right.”\n\nStrauss Zelnick\n\nYeah, that’s attributed to him. It’s not clear it was him, but we used that line at ZMC for the first couple of years because it was so hard to do what we did.\n\nDavid Senra\n\nIt’s in your book.\n\nStrauss Zelnick\n\nYeah. See, that line is in—\n\nDavid Senra\n\nI was going to read the book in a while—well, I read it this past week. To the degree that we do have any kind of influences, I’m the son of a Cuban immigrant. I grew up meeting people who literally risked their lives to flee communism. I knew from the time I was probably 9 years old that something was weird about this country I’d been born into. Something special is here.\n\nWhat we’re trying to do is distinguish that from corruption and crony capitalism. We’re trying to celebrate people who build products that make other people’s lives better. They build wealth for themselves, their families, and their employees. They create jobs.\n\nWe had John Mackey on this podcast, the founder of Whole Foods. One of the stories he told was one of my favorite stories. Because we went public early, and there were stock options for our employees, these were grocers—normal people who just wanted to live a normal life—and they were able to send their kids to college because of the stock. They were able to buy a home because of the stock.\n\nWhy wouldn’t John be celebrated? He started that with an idea, with his girlfriend and 2 other co-founders. Those people should be celebrated. I think the reason that came to mind when we were talking right now is that they’re not celebrated because they want to do it for themselves. It’s in service of other people.\n\nStrauss Zelnick\n\nOh, listen, I’m not saying—and I definitely have my own personal ambitions, including material ambitions. They were palpable and meaningful, and the truth is that I’ve evolved over time.\n\nSo when I started out, I didn’t read How to Win Friends and Influence People for the first few years. I was at Fox when I read it.\n\nDavid Senra\n\nI put off the book for a while. I saw it like you. I was like, “Ugh.”\n\nStrauss Zelnick\n\nAnd I think I was the guy who was insecure, and my approach to a situation was, “How am I coming across? How do I look? What do people think about me? What do you think? Let’s talk about me.” I could mask it behind a humble exterior, but frankly, you can’t fake humility. I was anxious all the time as a result, and I nearly failed at Fox as a result of this. It was a book that changed my life. I turned it upside down—immediately turned my life upside down.\n\nDavid Senra\n\nWhat was the different position you were taking when you were in your early 30s at Fox?\n\nStrauss Zelnick\n\nIt was basically, “I’m trying to work through you to accomplish what my ambitions were,” as opposed to actually figuring out, “I’m the smartest guy in the room. I’ve got the sharp suit on. I can speak grammatically. I’ve got a couple of Harvard degrees. We’re just going to do it my way.”\n\nI wasn’t like that, because I wasn’t a— But that was the subtext.\n\nI shifted that to, “How can I be of service to you? How can I be of service, and how can I get to know you?”\n\nDavid Senra\n\nHave you seen anybody have long-term success who doesn’t have a service mindset?\n\nStrauss Zelnick\n\nSure. There are different styles that work. One of the things I’ve learned is that it isn’t one size fits all. My approach is not for everyone. And, by the way, I’m not the most successful guy on Earth—not even close. So this is not, by the way—and I hope it didn’t come across this way. This is my approach, and everyone should follow my approach. To your point, you’ve interviewed loads of people and read hundreds of books. It’s not the same approach. There are some common elements, of course, but Elon Musk’s approach to business is diametrically different from mine. He does not have “be kind” as one of the company values.\n\nI just did an episode with the author of the new book, and one of the things in that book about Elon, in Elon’s own words, was that camaraderie is dangerous. So, I don’t know him. It is clear that we have very different approaches. Last time I checked, he’s the richest guy on Earth and I’m not, so I’m not here to criticize him or his approach. It’s his journey.\n\nBut I’m aware of the fact that his style, though completely different from mine, is a very successful style. In the video game business, I would argue that we run our business differently than anyone else. There are other successful enterprises, plenty of them. By the way, thank God there are, because if we were one of one, I’d be nervous about our future.\n\nEven more broadly, in the entertainment business, there are styles that win that are not my style. Barry Diller’s style, for example—the Socratic method that he pursues, which can be brutal. It really can. I mean, I can’t use it. It’s brutal at times. That’s just not my approach. I don’t do it that way. But it works for him. We’re different people.\n\nI think there are times when I have missed things because I take too soft an approach. I think I can sometimes support people on the team longer than I should. There are times when I’ve kicked the can down the road and shouldn’t have done that, although I really learned from it. But I don’t have the view that my approach is the only one or the best one. It just happens to be my approach, and it does, generally speaking, work.\n\nIt’s worked for my life in that, you know, I’m not the richest guy on Earth, but I’m not going to miss a meal. I haven’t built the biggest business, but I built a business I’m proud of.\n\nDavid Senra\n\nYou’re going to miss a meal for several lifetimes.\n\nStrauss Zelnick\n\n[Laughter]\n\nDavid Senra\n\nAnd let’s be clear.\n\nStrauss Zelnick\n\nYou know, I haven’t built the biggest business, but I built a business I’m proud of. I built a giant business.\n\nDavid Senra\n\nYeah, you don’t think in those terms, though, right? The notion that one size fits all in almost anything in life—well, I want to transition and ask you about something because you have all this experience in media. Obviously, I’m kind of in that business, even though I don’t know if I think about it that way, so I want some personal advice from you.\n\nThis is such an important thing about how one size doesn’t fit all. Daniel Ek, the founder of Spotify, and I are working on this project to try to outline all the different founder archetypes. We might even commission a book on this because it’s so important. It became a lot of conversations where he was essentially playing a role. He said, “All young entrepreneurs—technology entrepreneurs in their 20s—say, ‘What are my options? I have to be like Steve Jobs in the way he communicates, and now I have to be like Elon.’”\n\nHe said, “I was literally playing a role that wasn’t me.” He says he wasted so many years of his life not realizing that there isn’t one type, and it’s dependent on who you are and your own style. You just said something that was interesting. Somebody who works with you emailed me, and I’m curious: People think Take-Two is in the video game business. I think you think of it as being in the media business.\n\nStrauss Zelnick\n\nThe media business, yeah.\n\nDavid Senra\n\nOkay, what’s the difference between the media business and the entertainment business?\n\nStrauss Zelnick\n\nMedia is just a broader rubric that could include advertising, for example. Advertising would be a media business.\n\nDavid Senra\n\nWhy not describe it like this: What’s the difference between entertainment and video games? “Video games” just sounds a bit narrow.\n\nStrauss Zelnick\n\nWe provide an entertainment experience expressed through video games. Maybe that’s a difference. It doesn’t make a difference, but I think it does.\n\nDavid Senra\n\nOkay, so explain how you think about this. You could think of a video game as a mobile video game you spend 7 minutes on, or you could think of it as Grand Theft Auto 6, which you spend hundreds of hours on. They’re very different experiences. They’re both entertainment experiences. I think to call them both video game experiences maybe understates the diversity of the experience.\n\nDo you think all the different forms of entertainment compete with one another, but are also kind of collapsing together? Do you look at it like that, or no? To me, the distinction between a video game and watching something else, listening to a podcast, or interacting with AI is just all entertainment and information.\n\nStrauss Zelnick\n\nOh, yeah. I look at the media day broadly. According to Activate Consulting, the media day is around 13 hours in the U.S. Anything that fits within the media day can compete or coexist. So, yes, in that way—but no, at the end of the day, playing a video game is still a very different experience from watching a linear television show.\n\nDavid Senra\n\nIt just is. This goes back to your insight that I don’t even think we talked about. When you thought about new media, you said the most valuable new media was not going to be passive; it was going to be interactive. I think that’s the term you used.\n\nStrauss Zelnick\n\nThat’s the case with video games because it’s the biggest entertainment business, and it’s growing more rapidly than any other. In size, it’s bigger than all the other forms combined.\n\nDavid Senra\n\nIs that at the software level?\n\nStrauss Zelnick\n\nYeah, at the software level.\n\nDavid Senra\n\nThat’s insane, and it’s growing faster.\n\nStrauss Zelnick\n\nAbsolutely. Roughly double the rate.\n\nDavid Senra\n\nIs there anything else that you would be interested in pursuing in media besides video games?\n\nStrauss Zelnick\n\nSure, I’m open-minded. I think that in the fullness of time, one could ask whether it would make sense for Take-Two to diversify into other forms of entertainment. I can assure you we would not diversify backward into backward-looking, legacy, declining businesses. But there are other exciting entertainment businesses, and there will be more in the future. Live entertainment is a really interesting space, for example, and it’s growing.\n\nDavid Senra\n\nHow is Take-Two using AI right now?\n\nStrauss Zelnick\n\nWe have hundreds of projects going on, and we already have enterprise software. We have enterprise versions of ChatGPT and Claude available for everyone to use that are fully licensed and paid for. We have about 200 projects going on to try to create more productivity and give people the tools they need to do their jobs, whether they’re creative jobs or executive jobs, more effectively and efficiently, with more innovation.\n\nDavid Senra\n\nLet’s go back to that story where you were like, “Well, we need a 20th Century Fox. We need a business guy. Let’s grab this guy.” When you realized you needed an AI person, did you create an entirely new role? How was the structure?\n\nStrauss Zelnick\n\nNo, we have a new CTO, David Klein, and it all reports to David because it’s technology. It sits within the technology world. And not in any way to minimize the effect of all things AI, but first of all, the words mean different things to different people. We’re a technology company that makes entertainment. We always have been.\n\nThis is not new to us. Engaging with technology aggressively to create better products, market them better, and run our business better is what we do. Innovation and efficiency fit well within our system. We’ve pushed really, really hard to be as ambitious as possible, and even so, I’d say we’re getting internal criticism that we’re not moving fast enough. But we’re trying to.\n\nDavid Senra\n\nWhat is your overall viewpoint on AI, though?\n\nStrauss Zelnick\n\nAgain, that’s sort of like saying, “How do you feel about motherhood and apple pie?” I like both. All things technology that can create efficiency, I’m all in on.\n\nDavid Senra\n\nBut you’re doubtful of the creative ability of AI?\n\nStrauss Zelnick\n\nNo, I’m not doubtful of anything. I’m totally open-minded. But remember what AI is, despite the fact that there are people in Silicon Valley who don’t want you to believe this: It’s big data sets, lots of compute, and a large language model mushed together. That’s what it is.\n\nData sets, by their very nature, are backward-looking. Creativity, by its very nature, is forward-looking. Creativity is informed by data. You’re informed by those hundreds of books that you read, and when you have a podcast, you’re informed by the ones you’ve listened to. How could you not be?\n\nBut if yours was just a really high-quality clone of Patrick’s, who would watch yours? The thesis that, with AI, we can more efficiently create a completely derivative property—derivative properties don’t work. That’s where the thread has been lost. AI so far is really great at asset creation, but hit creation is not asset creation. Asset creation is a necessary but insufficient condition for hit creation.\n\nI would love to say that AI will make it easier, quicker, and better to make hits, because who would benefit more than we would? We’re in the business already. We own IP, right? You know, you don’t have to create new IP. But it’s really, really hard to do with or without AI.\n\nCreating a “This Table Goes to Hollywood” is incredibly hard. Getting someone to buy that video game is incredibly hard. Getting them to buy Grand Theft Auto 6 is not so hard by comparison. So, it’s not that I take the potential benefits of new technology lightly. To the contrary, I don’t.\n\nDavid Senra\n\nNo, I think your entire career has been a good example—\n\nStrauss Zelnick\n\nOf my career. It’s just that when our stock goes down by 50 points because people say, “Anyone can make a video game,” that was the thesis.\n\nAnd with AI, anyone can make a video game. It’s like, “Anyone could make a video game last week.” Anyone could make a video game 5 years ago. The technology is readily available. It’s commoditized.\n\nDo you know how many mobile games get put out in a year? Thousands. Do you know how many hits are made in a year? Zero to 5. You know who makes them? Thank you very much, we do.\n\nThis is just true. We don’t need this new technology to create assets that are competitive. That already exists. It will be quicker to do it, but speed isn’t the issue.\n\nIf I told you, “David, with this technology, you can create something that looks exactly like GTA, and it’s going to take 3 years, not 30 seconds,” you’d be like, “I’ll spend 3 years on it. It’s worth it.” That exists. In 3 years, technology existed prior to AI to clone GTA. But it won’t be GTA. It’ll be a clone of GTA.\n\nClones don’t sell. All hits are, by their very nature, unexpected. That’s the most important thing to take away. Things that are data-driven in their entirety can’t be unexpected. But that doesn’t mean AI isn’t super helpful.\n\nDavid Senra\n\nPerfect place to end. Strauss, thanks for the time. This was awesome. I really appreciate it, man.","tldr_md_alt":"- **Zelnick 接管 Take-Two Interactive（TTWO）是“独一无二”的交易——这是一次零资金完成的敌意收购，因为“我们没有钱”。** 他的无基金公司ZMC找到了一份普通、未经修订的特拉华州公司章程，在不触发申报的情况下征集了最多10名股东的支持；这10名股东持有约70%的股份，而股权集中在约20家对冲基金手中。ZMC最终在2007年股东年会上赢下一场闻所未闻的现场投票，临时计票结果为88%，次日便走进了这家公司的顶层办公室：当时公司营收约7亿美元、现金约5000万美元，董事长遭到起诉，还面临4项调查（IRS、SEC、纽约州检察长办公室、FTC）。当时市值约7亿美元，如今约350亿美元。\n- **这段故事最令人唏嘘之处在于：Zelnick 曾在 BMG 内部打造游戏部门，却被新任 Bertelsmann CEO Thomas Middelhoff 逼着卖掉；买方正是 Take-Two，而 BMG 卖出20%持股、套现1400万美元后仅1个月，Take-Two 就发行了这个部门完成的第一款作品：Grand Theft Auto。** Middelhoff曾要求他不要在公开市场卖出这部分股票，但Zelnick还是卖了。在Zelnick看来，多数人相信GTA是有史以来最有价值的娱乐IP，而BMG曾短暂持有其1/5，代价却只相当于财务报表上的一个四舍五入误差。\n- **他的结构性判断是：1955年和解令把制片厂体系变成精品店体系后，电影业一直运行在“正面我赢、反面你输”的经济模式下；游戏业至今仍是制片厂体系——“相当于1920年代电影业的行业”。** 如今游戏已经是最大的娱乐产业，仅软件层面的规模就超过其他所有娱乐形式的合计，而且增速约为后者的2倍。\n- **针对导致股价下跌的“AI会杀死游戏业”论点，他说：“创造爆款不是创造资产。”** 创造资产是必要条件，但不是创造爆款的充分条件。数据集回看过去，创造力面向未来；“克隆品卖不动”，而“所有爆款从本质上都出人意料”——每年有数千款移动游戏上线，最终诞生的爆款只有0到5款，“你知道是谁做的吗？多谢，是我们”。与此同时，Take-Two在CTO David Klein领导下运行着约200个内部AI项目。\n- **GTA 6 定于11月19日发售，比最初日期晚了约18个月；Zelnick 仍然支持人才接受延期，因为那份承诺“会在最糟糕的时刻接受考验”。** 他的典型做法是：一款已完成的游戏距离发售只剩2个月时，创作者认为质量不够好，他仍批准投入5000万美元重制；这款游戏后来成为Borderlands。“文化和人格一样，都是在危急关头接受检验的。”\n- **运营上的优势就是把事情做得足够无聊：“我们经营的是一家理性组织”——不吼叫、不被起诉、资产负债表稳健，做扭转时先重新谈判前10大供应商，而不是先裁员。** 他用这种方式在Take-Two削减了约4000万美元；公司在GTA发售年可能赚约1亿美元，其余3年却可能亏损，因此计划很简单：按照“成为最具创意、最具创新、最高效”的原则，做出其他爆款作品。\n- **他的成功经验并不神秘，关键是把雄心具体化：2001年，他用自己的30万美元，带着办公室卫生间墙上不断淌水的窘迫条件，开始打造一家约200亿美元、由科技加速的媒体组合；如今整个公司“可以说是一家400亿美元的公司”。** “知道自己想要什么，并围绕这个目标行动，你就更有可能得到自己想要的东西。”","digest_md_alt":"### 1. 一笔独一无二的交易：零资金敌意收购\n- Zelnick开场先坦率谈起幸存者偏差：“这种故事往往有点自利，因为结果不错……多数交易根本不会发生，发生的交易也不一定有好结果。”随后他承认，这笔交易无法复制：“我们本质上是零资金完成了一次敌意收购。之所以这么做，是因为我们没有钱。所以这确实是我们唯一的选择。”\n- 后续一切都建立在同一个框架上：ZMC成立于2001年，目标是在“媒体与科技交叉地带”收购、扭转并打造公司，核心判断是科技会给媒体加速，同时创造和摧毁价值。“我在2001年就觉得这相当明显，但娱乐行业并不这么认为。”\n\n### 2. Columbia Pictures，1983：最不重要的高管成了新媒体负责人\n- 他的第一份工作是把电影发行到免费电视，这是“火车的最后一站”；当时所谓“新媒体”指的是录像带和付费电视。Columbia安排他的逻辑是：“这家公司里谁是最不重要的高管，可以让他负责新媒体？那个人就是我……这是发生在我身上最好的事。”他的类比是，如今每家公司都需要一个AI负责人。\n- 他是通过回顾历史来做未来主义者：他的研究生论文覆盖了从1895年（蜡筒、自动钢琴）到1983年的电子娱乐，并提炼出2条长期有效的经验：“永远要拥抱新技术。如果与技术对抗，就会被时代甩在后面”；“大多数人天生相信眼下发生的一切永远不会改变。但现实恰恰是，眼下发生的一切一定会改变。”政治、经济、媒体都不会“永远维持现状”。\n\n### 3. 从Vestron到32岁出任20th Century Fox总裁\n- 在6个月内将Columbia部门营收翻倍后，29岁的Zelnick、距离毕业仅3年，便成为最大独立家庭娱乐公司Vestron的总裁，并批准了《Dirty Dancing》，这部电影直到《Blair Witch》之前一直是票房最高的独立电影。但他看到了分销模式的缺陷：“娱乐业不可能只靠分销建立竞争优势……必须立刻进入制作环节。”这也是Netflix制作内容的原因。\n- 1986年，Zelnick通过《Young Guns》认识的独立制片人Joe Roth被任命为Fox董事长；Barry Diller要求他“招一个懂生意的人”，于是Roth找到了自己认识的头号人选。Zelnick却把这句话说得更准确：“我不是这个行业里的第100号人物，我只是这个狭窄的独立娱乐行业里的第1号人物。”\n- 这次招聘本身也带着鲜明的时代感：在Bel-Air吃早餐，当天上午与Diller会面，Diller连续抛出尖锐问题，Rupert Murdoch全程沉默；随后人力资源负责人直接把他带进办公室签字。“现在已经不会这样了。”\n\n### 4. Diller和Murdoch真正教会他的事\n- Diller的方式是“火药味十足的充分辩论”：“他99%的时候是对的，但有1%的时候其实是我对。”活下来的关键，是把争论从个人层面剥离出来：“如果你退让，如果你不争论，你就完了……这不是关于我，而是关于事情本身。”一位同事用充气小丑玩偶来形容：“你只管挨打，倒下去，再继续弹回来。”Zelnick承认自己天生喜欢协作，但为了得出正确结论，他学会了适应Diller的风格。\n- Murdoch给他的教训发生在STAR TV过度加杠杆危机期间：约150家银行、交叉违约机制，整个家族企业都面临风险。“他全程都很冷静……始终用激光般的注意力盯住结论，然后仅凭专注和冷静得出了结论。”后来Zelnick在自己的第一笔交易中，正是靠这种方式稳住局面。\n\n### 5. 灵光乍现：他本该在1927年经营一家电影制片厂\n- 在Fox工作期间，他意识到电影业自1955年和解令以来，经济模式就一直很糟糕：该法令把制片厂体系——人才纳入公司薪酬体系——变成了精品店体系——人才按项目竞价出售服务。“正面我赢、反面你输”：项目成功时，精品店拿走全部上行收益；项目失败时，制片厂承担全部亏损。相比之下，游戏业直到今天仍然是制片厂体系。\n- 他在《Forbes》杂志背面读到过Buffett的一句格言：一个声誉卓著、以聪明著称的管理层，遇上一门声誉糟糕的生意，“最终保留下来的会是这门生意的声誉”。他因此得出结论：“我本该在1927年去经营一家电影制片厂……什么行业相当于1920年代的电影业？答案就是游戏业。”\n\n### 6. Hollywood的Atari阴影、Rupert的拒绝与95%的降薪\n- 之所以逆势看好游戏，是因为Hollywood还背着1982年E.T.惨案的创伤：Warner旗下Atari用5周做出这款游戏，生产的卡带比市场上的主机还多，后来有人拍到这些卡带被铲进填埋场。Warner因此计提约4亿美元减记。“整个行业的反应就是：别再碰电子游戏。”\n- 当Zelnick向Murdoch提议打造游戏业务时，Rupert回答：“很好，那你去创办一家。”但谈到股权，回复则是：“没兴趣。这不叫报价。”Rupert除公众股东外没有其他合作伙伴。因此Zelnick接受了95%的降薪，去经营Kleiner Perkins支持的初创公司Crystal Dynamics，并举家搬进一套即将因高尔夫球场项目被拆除的出租屋。\n- 对自己创业时机的诚实判断是：“人生中大概有2个阶段适合创业：一无所有之前，以及已经拥有某种保护之后。而我当时正好处在中间……我不认为自己在情感上已经准备好了。”\n\n### 7. BMG灾难：以1400万美元卖掉Grand Theft Auto\n- Zelnick被招来扭转BMG，当时BMG营收约50亿美元；他先谈下了在BMG内部打造游戏部门的权利：投入约4000万美元，“连四舍五入都算不上”，利用BMG全球实体音乐分销网络运送卡带和光盘，不增加额外管理成本。当时没有其他音乐公司这么做。\n- 新任Bertelsmann CEO Thomas Middelhoff是“一个凭直觉下注的人，结果一点也不好，完全不好”，他在一款游戏都没发售前就要求剥离业务。买方是一家市值约1亿美元的上市公司，用自身20%的股份支付；Middelhoff要求Zelnick不要在公开市场卖出这些股票，但Zelnick还是以1400万美元卖掉了。“1个月后，这家上市公司发布了我们完成的第一款作品……这家上市公司的名字是Take-Two Interactive，第一款作品就是Grand Theft Auto。”\n- Zelnick的反应说明了他的性格：“我不容易生气……我知道那是个愚蠢的决定。”但他还是离开了，因为不可能为一个会做出这种决定的老板工作；“现在我准备好创业了。”\n\n### 8. 30万美元启动ZMC、借来的办公室和被水淹的卫生间\n- ZMC启动时没有资本：他投入自己的30万美元，员工免费工作，办公室“椅子永远比人数少1把”，卫生间“水像帘子一样沿墙流下来”。资金提供方要求先有交易，标的公司却要求先有资金；他观察一家PE机构的客套交流后意识到：“他们对所有人都这么说，只是在寻找免费的期权。”\n- 第一笔真正的交易是Columbia Music Entertainment，一家市场份额只有0.5%的日本唱片公司，债务过重、没有爆款，“里面可能还潜伏着罪犯”。他2次劝Ripplewood合伙人Jeff Hendren赶紧退出，直到Hendren反问：“你到底有多忙？”这笔交易耗时9年，是“我做过最难的交易”；但他借鉴Murdoch式的冷静——他知道“如果有人给我3亿美元让我接管一家企业，而我失败了，那会是我的最后一笔交易”——最终让ZMC在2000年代初的录制音乐行业实现了约22%的IRR。“闻所未闻。”\n\n### 9. 为Carl Icahn免费工作：“你永远不知道事情会走向哪里”\n- Zelnick通过主动提出不收钱来经营与Icahn的关系——正是那个说过“在华尔街，如果你想要一个朋友，就买条狗”的人。他的第一个想法是Reader's Digest，让Icahn在约5000万美元的仓位上赚了约5000万美元；回报是一顿Il Tinello晚餐：一杯马提尼一招滑进Icahn手中，而Zelnick的妻子在用餐中途俯身提醒他：“亲爱的，他连你的名字都不知道。”\n- 合伙人Karl Slatoff——至今仍是Take-Two总裁——在Icahn进一步要求ZMC免费为他的华尔街朋友做研究时勃然大怒：“他已经告诉我们，永远不会付钱。我们到底在这里干什么？”Zelnick的回答前后说了2次：“你永远不知道事情会走向哪里。”值得一提的是，ZMC自己关于Take-Two的备忘录明确建议避开这家公司——“不够有前瞻性”，他笑着说。\n\n### 10. “读公司章程”：不可能的收购是如何完成的\n- Icahn打来一通神秘电话：“你读过公司章程吗？……你知道你应该做什么吗？读公司章程。”说完就挂了。Zelnick由此发现，一份普通、未经修订的特拉华州公司章程允许通过50.1%的书面同意罢免董事会。陷入困境的股票集中在约20家对冲基金手里；SEC规则允许在不申报的情况下征集最多10名股东的支持，而这10名股东持股约70%。ZMC负担不起标准的约300万美元代理权争夺战，因此这条路是唯一选择。\n- 支持率一度最高只有48%。“我当时想，好吧，游戏结束。”直到合伙人Ben Feder发现了第2条关键规定：在股东年会上举手，只要赢得实际出席股东所投票数的多数，就能当场接管公司。“闻所未闻。按理说不存在，但这里确实存在。”随后又出了问题：对冲基金把股票借给了做空者，因此无法投票。“那我们有多少？”“你不会喜欢这个答案。22%。”\n- 股东大会现场有报刊报道和电视摄像机，CEO拒绝出席；一位法学院同学向他挥手致意，聊了5分钟后，Zelnick才发现对方来自Fidelity——这家大型持股机构此前拒绝加入他们的阵营，通常也支持管理层。“我看着负责征集投票的人说：‘我们赢了。’”临时计票结果是：“你们有88%。接受这个结果，还是要我们继续数？”2007年次日，他以董事长身份走进了顶层办公室。\n\n### 11. 扭转手册：先重新谈供应商，再考虑裁员\n- 他接手时的资产状况是：一个好项目GTA正在开发，但很快就延期；一家规模很小、能够盈利的NBA业务；其余所有业务都在亏损。公司在GTA发售年可以赚到约1亿美元的可观利润，其余3年则会亏损。计划是削减成本，“经营一家理性公司，与创意人才保持友好，分散产品管线，打造一家娱乐公司”。\n- 他的标志性动作是在最初不裁员的情况下削减约4000万美元：盘点前10大供应商，逐一重新谈价。这样既能立刻省钱，也不会惊吓团队，“团队会想，哇，他们刚刚省下了这么多钱，而且没有人被裁。”他从不主张先查报销单：“这是疏远David的好办法。如果David还有其他选择，他第2天就会离职。”\n- ZMC有一条值得照搬的规则：扭转业务时，只接手第一支进场的团队。“我们没有那么聪明。聪明人都会做同样的事情。”此前失败的扭转团队很可能已经把你能想到的办法全试过了。至于Take-Two早期的错误，他说：“你还能怎样？人已经在谷底，没有更低的地方可跌。”\n\n### 12. 给人才的承诺，以及5000万美元的Borderlands考验\n- 最重要的招募承诺不是理性，而是：“我们会给你追逐热爱的事业所需的创意和资金资源……无论顺境逆境都会支持你。”其次才是一个成熟公司的环境：没人吼叫、没人被起诉、不与FTC闹僵；最终还要有一张足够稳健的资产负债表，因为“我们失败时——在娱乐业，你不可避免会失败——公司还能活下来，继续下一局”。\n- 真正的考验发生在扭转尚未完成、资本有限时：一位部门负责人认为距离发售只剩2个月的游戏质量不够好，希望重做，追加5000万美元并再等1年。Zelnick最初坚持反对，但最终还是支持了这个决定。“那款作品后来成了Borderlands……我几乎可以保证，行业里没有其他人会这么做。为什么？因为这太疯狂了。”他的格言是：“文化和人格一样，都是在危急关头接受检验的。”\n- 面对难相处的创意天才，他说：“我喜欢他们……要成为有效的领导者，你必须真诚地关心他人。”但这不是家庭关系——“我的家人在家里，这里是一家企业”——而且必须有边界：对于一位言语攻击性很强的创意人才，他干脆不再读对方的邮件，“删除键存在总有它的理由”；最终，“他还是得走人”。\n\n### 13. GTA 6，11月19日：以及游戏为何成为最大的娱乐产业\n- 面对没完没了的“GTA 6什么时候发售”，他的回答是：“11月19日，这个日期我确定。”这比最初日期晚了约18个月。至于GTA是否是史上最大的游戏，要看你如何与Mario Kart和Call of Duty系列比较；但“就IP价值而言，多数人相信它是有史以来最有价值的娱乐IP”。GTA 5的总营收没有披露：“很多。”\n- 他把Take-Two定义为一家媒体和娱乐公司：“我们提供的是以电子游戏形式呈现的娱乐体验。”据Activate Consulting统计，美国人每天约有13小时用于媒体消费，其中任何一种内容都可能彼此竞争，也可能共存；但玩游戏与观看线性节目仍然不同。就软件层面而言，游戏规模已经超过其他所有娱乐形式的合计，增速约为后者的2倍。他那位90岁的母亲会在线上与从未见过面的朋友打桥牌。他会考虑向现场娱乐等增长领域多元化，但“不会反向多元化，去做那些面向过去、已经衰退的传统业务”。\n\n### 14. 可视化不是魔法：它迫使你把雄心变得具体\n- Zelnick从“十亿本传记”中提炼出的结论是：高度成功者唯一共同的因素就是“他们知道自己想要什么”。这不是Napoleon Hill式对着镜子写目标——“知道自己想要什么，并围绕这个目标行动，你就更有可能得到自己想要的东西。”相反，魔法式思维是：“因为我想要它，所以它就会发生。”Senra从自己的415本传记数据库得出了同样的结论：如果必须把10年的研究压缩成一个词，那就是“专注”。\n- 他的成长轨迹是：2001年立志打造一家约200亿美元的公司；创业10年、在MIT被问到拥有约10亿美元是否让他“深感失望”时，他回答：“方向是对的，而且我不会停下。”如今整个公司“可以说是一家400亿美元的公司。我们算是超额完成了目标，而且还没有结束。”Take-Two的信条人人都能说清：使命是成为全球第一的娱乐公司；战略是最具创意、最具创新、最高效；文化是卓越、团队合作和善意——14,000名员工都知道这一套。\n- 他在辅导上的意外投入是：把20%–25%的时间用于指导员工，而且他说自己很容易找到，尽管员工仍然需要先做功课。他布置的练习，大约一半人从未回来跟进。“有些人相信，只要能和那个真正成功的人待在一个房间里，对方就会挥动魔杖。”他给新员工的建议是：周一来公司时，先问自己如何创造比成本更多的价值；周五再做一次自我审计。\n\n### 15. 服务他人胜过自我营销，但没有放之四海皆准的模板\n- 《人性的弱点》（How to Win Friends and Influence People）在Fox改变了他的人生；在那里，他一度“差点失败”，内心真正运行的是：“我是房间里最聪明的人……我有2个哈佛学位，所以我们按我的方式做。”他用自己无法伪装的谦逊把这层自负包起来，结果始终焦虑。转折点是：“我如何才能为你提供服务？”他赞同Carnegie讲过的邮局职员故事：“我们难道如此心胸狭窄，非得从每一次互动里捞到点什么不可？”\n- 但他拒绝把这套方法绝对化：“Elon Musk的经营方式与我的截然相反……据我最近所知，他是地球上最富有的人，而我不是。”新出的Musk传记则认为，“兄弟情谊很危险”。Diller的苏格拉底式提问“可能非常残酷”，但对Diller有效。Zelnick承认自己的代价是：“我有时会让团队里的人留得比应该的时间更久……有时我会把问题往后拖。”Senra则通过Daniel Ek补充道：年轻创始人往往浪费数年去扮演Jobs或Musk，而不是找到属于自己的成功原型。\n\n### 16. AI能创造资产，但创造不了爆款\n- Take-Two运行着企业版ChatGPT和Claude，以及约200个生产力项目，全部归CTO David Klein领导的技术体系负责；公司没有单独的“AI总负责人”，因为“我们是一家制造娱乐内容的科技公司，一直都是”。公司内部受到的批评反而是：推进速度还不够快。\n- 对于“有了AI，任何人都能做电子游戏”这一导致股价下跌的说法，他的反驳是：“上周任何人都能做电子游戏……每年有数千款移动游戏上线。你知道一年能做出多少款爆款吗？0到5款。你知道是谁做的吗？多谢，是我们。”AI不过是“大数据集、大量算力和一个揉在一起的大语言模型”；数据集面向过去，创造力则面向未来。\n- 关键区别必须原样保留：“创造爆款不是创造资产。创造资产是必要条件，但不是创造爆款的充分条件……不用AI，3年内你就能克隆GTA，但它不会是GTA。克隆品卖不动。所有爆款从本质上都出人意料。”他也没有夸大上行空间：谁会比已经拥有IP的公司更能从AI创造的爆款中受益——“但这不意味着AI没有巨大帮助”。","shows":{"name":"David Senra","hosts":"David Senra"}}