In "The Fixer," Bradley Tusk takes us on a journey through the world of political strategy and its intersection with disruptive start-ups. As a seasoned political operative turned start-up advisor, Tusk offers a unique perspective on how innovative companies can navigate the complex landscape of politics and regulation to achieve their goals.
The book provides an insider's view of some of the biggest battles between start-ups and the political establishment, showcasing how Tusk's experience in political campaigning and media management has helped companies like Uber, FanDuel, and Lemonade overcome significant obstacles. Through a series of engaging stories and case studies, Tusk reveals the strategies and tactics that have proven successful in taking on entrenched interests and reshaping industries.
Early Career Lessons: The Power of Public Relations
Crafting Narratives for Politicians
Tusk's journey into the world of political strategy began with valuable lessons about the importance of public relations and controlling the narrative. Working for Henry Stern, a New York City council member and parks commissioner, Tusk learned that politicians crave constant attention and validation. His job was to generate as much publicity for Stern as possible, which not only kept the politician happy but also made it easier to secure budgets and push policies.
To make parks-related news interesting, Tusk had to get creative. He staged attention-grabbing events like a funeral for "murdered" trees to promote new measures against illegal tree felling. For the opening of a new park bathroom, he organized a ceremonial cutting of a toilet roll instead of a traditional ribbon-cutting. These unconventional approaches garnered significant media coverage and kept Stern in the public eye.
Maximizing Media Coverage for Chuck Schumer
Tusk's next role as communications director for Senator Chuck Schumer further honed his skills in media manipulation. Schumer understood that voters appreciate seeing their politicians busy, even if they don't fully understand what politicians do day-to-day. To meet this need, Tusk and his team focused on generating constant media coverage, often inventing newsworthy events when there wasn't much happening.
One of their tactics was to write tough letters to large companies on topical issues, like protesting the rising cost of windshield wiper liquid. In another instance, Tusk developed and released a proposal for modernizing outdated voting machines. This idea proved particularly timely when the 2000 presidential election faced chaos due to problems with old punch-card machines. As a result, Schumer was suddenly seen as an expert on the subject, leading to extensive media coverage.
These experiences taught Tusk a crucial lesson that would serve him well in his future career: the ability to shape the media narrative is a powerful tool for influencing politicians and achieving desired outcomes.
Political Campaigns: Targeting the Enemy
Bloomberg's Third Term Campaign
Tusk's skills were put to the test when he became campaign manager for Michael Bloomberg's bid for a third term as New York City mayor in 2009. The campaign faced significant challenges, as Bloomberg had raised taxes and water rates during his previous terms, potentially alienating voters.
One of the biggest threats to Bloomberg's campaign was the potential candidacy of Anthony Weiner, a charismatic state congressman with strong fundraising abilities. To neutralize this threat, Tusk devised a strategy focused solely on discouraging Weiner from entering the race.
Aggressive Tactics Against Weiner
Tusk's approach involved a multi-pronged attack designed to make Weiner feel that the risks of running were too high. The campaign team dug into Weiner's past, uncovering potentially damaging information. They found that Weiner had received campaign donations from models who had benefited from legislation he had passed, raising questions about pay-to-play and the legality of donations from non-US citizens.
To further intimidate Weiner, Tusk employed unconventional tactics. Bloomberg volunteers conducted early door-to-door canvassing in Weiner's neighborhood, including his family's home. This wasn't aimed at winning votes but at sending a message about the campaign's reach and resources. Similarly, the team purchased targeted online ads that would appear whenever Weiner browsed the internet in his zip code.
The Strategy's Success
The relentless, highly personal campaign had its intended effect. Faced with weakening poll numbers and a growing sense of vulnerability, Weiner ultimately decided not to run. This cleared the path for Bloomberg to secure his third term as mayor.
This campaign marked the end of Tusk's direct involvement in politics. With a substantial bonus from Bloomberg, he set up his own political strategy consultancy. While business was slow initially, a pivotal moment came when he received a call about a transportation start-up facing regulatory challenges. This would be the beginning of Tusk's journey into the world of disruptive start-ups and their battles with the political establishment.
Uber's Early Battles: Overcoming Powerful Opposition
The Challenge of Disruption
As Uber began to revolutionize the transportation industry, it faced opposition from multiple fronts. Unions were against Uber because they couldn't organize its drivers, who were independent contractors. The traditional taxi industry saw Uber as an existential threat as longtime customers switched to the new service. Regulators were wary of the new business model, and politicians were under pressure from their taxi industry donors to crack down on Uber.
The Washington D.C. Battle
One of the early battlegrounds for Uber was Washington D.C., where a local politician introduced legislation that would effectively ban the company's operations. Tusk, now working with Uber, recognized that this was a perfect opportunity to apply the lessons he had learned in his political career.
Tusk's strategy focused on shifting the public narrative and demonstrating overwhelming popular support for Uber. His team crafted a press release accusing D.C. politicians of protecting the taxi industry at the expense of consumers. They then mobilized Uber's user base through the app, encouraging drivers and customers to contact their city council members directly.
The result was unprecedented: nearly 40,000 tweets and 50,000 emails were sent to city politicians in just a couple of days. This flood of public opinion caught the politicians off guard and demonstrated that the political cost of opposing Uber far outweighed any benefits from appeasing taxi industry donors.
The Power of Public Opinion
The Washington D.C. campaign showcased the power of mobilizing public opinion to influence political decision-making. Not only was the anti-Uber legislation abandoned, but new legislation explicitly authorizing Uber's operations was passed unanimously later that year.
This victory set the stage for Uber's approach to regulatory challenges in other cities. By leveraging its user base and controlling the narrative, Uber could overcome entrenched interests and secure its ability to operate. However, the company's biggest challenge was yet to come in its most crucial market: New York City.
Taking on New York City: Uber vs. Bill de Blasio
The High Stakes Battle
New York City was a critical market for Uber, not just because of its size but because of its influence on other cities and states. When Mayor Bill de Blasio proposed legislation to limit Uber's growth to just 1% per year, it posed an existential threat to the company's future in the city and potentially beyond.
Tusk's Innovative Strategy
Tusk devised a multi-faceted strategy to counter de Blasio's proposal:
Attacking from the Left: De Blasio's political brand was built on supporting vulnerable populations - lower-income individuals, immigrants, and people of color. Tusk's team ran ads featuring passengers from the Bronx and Queens who shared stories of being ignored by yellow cabs due to racial discrimination. These ads positioned Uber as the solution to a longstanding problem, putting de Blasio on the wrong side of his own base.
Exposing Corruption: Tusk's team highlighted the close ties between de Blasio and the taxi industry, his second-largest donor group. They generated media stories about these connections, portraying de Blasio as beholden to moneyed interests - the very thing he had always campaigned against.
Mobilizing Users: Uber added a "de Blasio" button to its app, explaining the situation to users and encouraging them to contact their council members. In just one week, 250,000 people responded, creating an overwhelming wave of public pressure.
The Outcome
The combined pressure from media coverage, driver and user advocacy, and shifting public opinion began to erode support for de Blasio's bill among city council members. Eventually, the mayor's office abandoned the proposed legislation, securing Uber's future in New York City.
This victory demonstrated the effectiveness of Tusk's approach: combining media savvy, strategic messaging, and the power of a motivated user base to overcome political obstacles. It also highlighted how start-ups could leverage their unique assets - in this case, a large and engaged customer base - to fight back against established interests and unfavorable regulation.
The Challenges of Reforming Labor Laws: Handy's Struggle
A New Approach to Benefits
Handy, a platform connecting customers with handymen and cleaners, sought to innovate in the gig economy by offering benefits to its independent contractors. The company proposed creating a benefits fund that other sharing economy platforms could contribute to, potentially providing millions of workers with benefits while maintaining their independent contractor status.
Unexpected Opposition
Surprisingly, the main opposition to this worker-friendly proposal came from unions and Democratic politicians. Unions, unable to organize or collect dues from independent contractors, saw the rise of the gig economy as a threat to their power and influence.
The New York Battle
Tusk and Handy took their fight to New York, where they encountered strong resistance from SEIU 32BJ, a union representing security guards and janitors. Despite not representing housekeepers, the union viewed anything related to cleaning as their territory and refused to compromise.
The situation was complicated by internal union politics. The union president, facing an upcoming re-election, couldn't afford to appear weak on issues related to non-unionized workers.
Political Roadblocks
When Tusk's team approached Governor Andrew Cuomo's office, they found that the governor was unwilling to act without union support. The constant refrain from the governor's representatives was, "What's 32BJ's view on this?"
This experience highlighted the entrenched nature of traditional labor-management relationships in politics. Even when presented with an opportunity to expand benefits for workers, politicians were hesitant to act without the blessing of established unions.
The Ongoing Struggle
While Tusk and Handy were unsuccessful in New York, they continue to advocate for changes at both state and federal levels. This case demonstrates that sometimes, even the most creative political strategies need to be combined with long-term persistence to overcome deeply entrenched interests and political dynamics.
The Handy case serves as a reminder that disrupting established systems often requires more than just a good idea. It requires navigating complex political landscapes and being prepared for opposition from unexpected quarters.
The Importance of Political Risk Management for Start-ups
The Daily Fantasy Sports Industry's Oversight
The rapid growth of the daily fantasy sports industry, led by companies like FanDuel and DraftKings, provides a cautionary tale about the dangers of ignoring political risks. These companies were so focused on competing with each other that they failed to prepare for potential opposition from other quarters.
The Sudden Crisis
In October 2015, the New York Times published an article accusing a DraftKings employee of using insider information to win money in a FanDuel competition. This sparked investigations by state attorneys general, putting the legality of daily fantasy sports in question across 39 states.
The Consequences of Unpreparedness
The industry found itself in a lobbying battle against casinos, which had long-established relationships with state governments. FanDuel and DraftKings, with no political connections, were at a significant disadvantage.
Tusk's Intervention
Tusk, now working with FanDuel, employed a strategy similar to the one used with Uber. They mobilized customers to contact their state legislators, resulting in 150,000 people advocating for the industry. By the end of the 2017 legislative session, they had secured legislation in 15 states.
The Lesson
While the outcome was ultimately positive, the crisis could have been avoided or mitigated if the companies had been better prepared for potential political and regulatory challenges. This case underscores the importance of incorporating political risk assessment into business strategy, especially for disruptive start-ups.
Challenging Regulatory Bodies: Lemonade's Insurance License Battle
A Disruptive Insurance Model
Lemonade, a fully digital insurance company, aimed to revolutionize the industry with easy sign-ups, low prices, and rapid payouts. However, their innovative model ran into trouble when the New York Department of Financial Services (DFS) refused to grant them an insurance license.
The Regulatory Roadblock
The DFS's inflexible processes, based on traditional insurance models, couldn't accommodate Lemonade's unique approach. It became clear that simply engaging with the regulators wouldn't be enough to overcome this obstacle.
Tusk's Political Strategy
Tusk decided to bypass the regulators and appeal directly to Governor Andrew Cuomo. The strategy involved demonstrating the high political cost of not approving Lemonade's license.
Leveraging Start-up Advantages
Tusk's approach utilized several advantages that start-ups often have in political battles:
- A compelling narrative for the media
- Effective inside lobbying
- Advertising budget
- The ability to relocate (and take jobs with them)
- The moral high ground of innovation
Applying Pressure
Tusk's team spread stories about New York potentially losing an innovative company to London due to bureaucratic obstacles. They also highlighted the political donations Cuomo had received from the insurance industry, suggesting pay-to-play decision-making.
Additionally, they prepared a letter from venture capitalists questioning the wisdom of investing in New York's tech sector if innovative companies like Lemonade couldn't get licensed.
The Ultimatum
As pressure mounted, Tusk's lobbyists presented the governor's office with a choice: either approve Lemonade and get positive headlines about supporting innovation, or face negative press about driving away a hot start-up due to bureaucracy.
The Outcome
A few days later, Lemonade received its approval. This case demonstrates how political strategy can be used to overcome regulatory hurdles, especially when traditional channels prove ineffective.
The Bloomberg Presidential Run That Wasn't
A Promising Candidate
In early 2016, Michael Bloomberg seriously considered running for president. As an independent with the ability to self-finance his campaign, he seemed well-positioned to appeal to voters disillusioned with both major parties.
Tusk's Innovative Campaign Ideas
Tusk, who agreed to run the campaign if it went ahead, developed some creative strategies:
The Uber Partnership: Tusk proposed partnering with Uber to offer free rides to polling stations for all U.S. voters, with a Bloomberg button prominently featured in the app.
The Dream Team Approach: To differentiate Bloomberg from other candidates, Tusk suggested building the campaign around the idea of assembling a team of the "brightest and best" to fix America's problems. This would include high-profile figures like Bill Gates for education secretary and Elon Musk for energy secretary.
The Decision Not to Run
Despite these innovative ideas, Bloomberg ultimately decided not to enter the race. Polling indicated that his candidacy was most likely to harm Hillary Clinton's chances, potentially increasing the likelihood of a Trump presidency. For Bloomberg, this risk was unacceptable.
The Aftermath
Tusk found the decision difficult to accept, as it meant missing out on the opportunity to run an innovative presidential campaign with unlimited resources. After Trump's victory, Tusk regretted the lost opportunity of a Bloomberg presidency, which he believed could have offered a safer, better alternative for America.
This episode highlights the complex calculations involved in high-stakes political decisions and the potential impact of "what if" scenarios in shaping the political landscape.
Strategic Advice for Start-ups Facing Political Battles
Choosing the Right Approach
Start-ups entering markets dominated by established players need to be prepared for political and regulatory challenges. Tusk offers several key pieces of advice:
Assess Compliance: Determine whether your product or service complies with existing regulations. If not, decide whether to seek permission before launching or to launch first and deal with the consequences later.
Consider the Consequences: When choosing to "beg for forgiveness" rather than ask for permission, carefully consider who you'll be dealing with. There's a significant difference between facing an irritated regulator and potential legal consequences.
Tools for Political Battles
Every start-up that threatens the status quo will likely face political opposition at some point. Tusk recommends considering the following:
Identify Your Assets: What politically valuable assets does your company have? Can you offer or threaten to withdraw jobs or your headquarters location?
Build Alliances: Fighting alone is challenging. Try to build coalitions with consumer rights advocates, VC investors, or even local politicians looking to prove they're not anti-innovation.
Understand Decision-Makers: Invest time in understanding the politicians who could impact your business. Learn what motivates them and how to shape narratives that will keep them on your side.
The Importance of Political Strategy
While there's no one-size-fits-all approach to political battles, investing in political understanding and strategy can be crucial for start-ups. By incorporating political analysis into expansion strategies and being prepared for potential challenges, companies can better position themselves for success in complex regulatory environments.
Final Thoughts
"The Fixer" offers a unique perspective on the intersection of politics, regulation, and innovation. Through his experiences with various start-ups and political campaigns, Bradley Tusk demonstrates the power of strategic thinking, media manipulation, and public mobilization in overcoming seemingly insurmountable obstacles.
The book serves as both a fascinating behind-the-scenes look at some of the most high-profile battles between disruptive companies and established interests, and a practical guide for entrepreneurs navigating the complex world of politics and regulation.
Key takeaways include:
- The importance of controlling the narrative and shaping public opinion
- The power of mobilizing users and customers as a political force
- The need for start-ups to anticipate and prepare for political and regulatory challenges
- The effectiveness of creative, multi-faceted strategies in overcoming entrenched opposition
- The value of understanding and leveraging political dynamics, even for technology-focused companies
Tusk's experiences highlight that in today's interconnected world, business success often depends not just on having a great product or service, but also on the ability to navigate complex political landscapes. For start-ups and established companies alike, developing political savvy and incorporating political risk assessment into business strategy can be the difference between success and failure.
As industries continue to be disrupted by new technologies and business models, the lessons from "The Fixer" will likely become increasingly relevant. Companies that can effectively combine innovation with political strategy will be best positioned to overcome regulatory hurdles, challenge established interests, and ultimately succeed in reshaping their industries.