Bloomberg Audio Studios, podcasts, radio news.

This is Wall Street Week.

I'm David Weston, bringing you stories of capitalism.

Last summer, we took you to Jackson Hole, the wealthiest place in the country.

Now we head east to Arkansas and Michigan to see what drives the most charitable counties in the US.

President Trump came to office promoting a swing away from green energy, but given the exploding energy demand from those AI data centers, has all of the above won what was a battle between fossil fuels and renewables.

As the Formula One season draws to a close, we spend time with the man who has already won.

Zach Brown brings us the remarkable story of his personal journey from rebellious high schooler in California to the pinnacle of auto racing as head of McLaren Racing.

But we start with the big visit this week of Crown Prince Mohammed bin salmana the Kingdom of Saudi Arabia to the White House, a symbol of a potential shift for investors from looking to the kingdom as a source of capital to a destination for Western investment.

Deborah Lair of Baslina has been working on the transition, so Devora.

The Crown Prince of Saudi Arabia, Mohammed bin Selman, came to Washing this week.

As far as you know, what was his agenda.

Well, just the arrival and the welcoming ceremony already has been a great success for the Crown Prince.

To be welcomed in an unprecedented way to the White House with this military band, military on horseback escorting him into the White House and the flyover the President personally walking him through already shows both the respect that the President has for him and the partnership that the United States is demonstrating with the Kingdom.

Under Vision twenty thirty.

The Crown Prince has put a priority on diversifying the economy.

This year, for the first time ever, fifty five percent of GDP actually comes from the non oil sector.

So as they look to attract data centers, for example, they just don't want to be host to them.

They want to build out a whole infrastructure around data centers, to be an electricity and cheap energy supplier, to building out the whole AI network, to attracting AI networks, to being the world's leader in eGames.

One of the benefits that Saudi Arabia has is obviously it's one of the largest countries in the Middle East, and so they can provide space for manufacturing data centers to provide that technology.

There's low cost energy for building up the AI infrastructure, so they've been in discussions to build out their own AI infrastructure.

They have their own domestic champions that they're building out, like Humane, but also they're looking to be the eest sports and e gaming capital of the world, and so they've spent a lot building out that infrastructure, in part because they have such a young population, but also it's an opportunity for them to show their own technological capabilities.

CE is a wealthy country at the same time, maybe not quite as wealthy as it was before because the price of oil is somewhat suppressed.

That's where it gets a lot of its revenue.

Form doesn't have to cut back at all on its investment ambitions given where its fiscal situation is.

Well, that's an excellent point, and clearly their revenues are still highly dependent on the price of oil, and we have seen it cut back in recent years on some of the mega projects.

So we've seen that in the case of NEOM, where they've cut back on the grand ambitions and slim down the project, but also then focused in on other things like the Saudi Expo, where they are putting a lot of money in capital into that project.

I think they're also being smarter about how they're spending their money.

Originally, they brought in a lot of outside consultants and spent millions and millions of dollars on plans and strategies and ideas of how to build or how to make these megaprojects successful.

They're not so dependent on those outside consultants anymore.

We've seen really a move to much more specialty insights that they're seeking from outside experts and taking a lot on themselves.

The conference, as you say, set out a very ambitious agenda for twenty thirty.

Do they have enough of a track record yet to know whether they're on track for where they need to get to?

Some vision twenty thirty was a very ambitious all of nation plan, one of the most ambitious transformations in the world, and it was a very aggressive timeline.

When we look at some of the indicators, for example attracting foreign investment, what they've had to do is transform their regulatory structure that even though it is moving forward, they've been able to streamline a lot of the regulations.

They've opened up sectors to one hundred percent ownership by foreign firms.

It's not one sided.

Western investors are responding to the friendlier tone and are at least dipping their toes into the kingdom.

In the past year, tech companies like Tesla and Scale Ai have moved operations and offices there.

Stephen Cook of the Council on Foreign Relations says Saudi Arabia is opening up with some limits.

Saudi Arabia is now open for business.

Of course, there are restrictions.

This is Saudi Arabia after all.

But the Saudis are interested in bringing the world to Saudi Arabia.

They look at its location.

They see it as an important center for culture, sports, tourism, technology and logistics.

I think the Saudis are kind of opening the door to all of these companies who have expressed a tremendous amount of interest in coming to Saudi Arabia.

But there is issues related to kind of from what I understand, related to what the Treasury Department and what the Commerce Department will allow a company of like Google or Apple to do in a place like Saudi Arabia.

What about countries other the United States as possible investors.

You're seeing, for example from Europe.

Yeah, you're seeing general interest in the quote unquote new Saudi Arabia from Prince Mohammad bin Salman.

His mantra has been to make Saudi Arabia a normal country.

Now, he is not a democrat, he's not a liberal.

This is all top down reform.

But I think what he sees is most Saudis are eighteen to fifty years old, and if you're going to make your country prosperous, and you're going to want to have that cohort staying and making their lives there.

And so he's been inviting investment from all over the world into the kingdom so that people can work and live and enjoy their lives like they would if they were in the United States or Europe.

One of the areas of potential investment is real estate, commercial and residential.

What is the level of investment in real estate right now going on in Jedda.

Well, I mean, the only way to really answer this, David is to say that the most off cited bird in Saudi Arabia, especially in those two cities, is the construction crane.

I mean, I don't think there are enough construction cranes in Saudi Arabia to satisfy all the building that is going on.

They've had to bring them in from other places.

In terms of real estate, who's doing the investing in all this construction with all these cranes you talk about, where's that money coming from?

Well, a lot of this is driven by the government, but you know, they've encouraged private firms to engage in the development of cities and so on and so forth.

So there are authorities that the government has established that have partnered with private firms in terms of the development in Jinda of the old city and the development of hotels there and tourist attractions there.

But a lot of this is top down driven by the government.

But there is private money coming out.

We've heard about Trump developments both Jida and read.

Adam Newman has a flow project in Riad as well.

That's private money going in.

And do they partner with Saudi How does that work?

Well?

Yeah, so there has been a recent change in how foreigners can invest in real estate.

It's in certain areas, and it has to be in partnership with a Saudi entity.

But it is less restrictive than it was where previously it was much much harder for foreigners to invest in real estate in Saudi Arabia.

Right now, AI is all the rage right in the United States and elsewhere.

There's a lot of concerned about maybe a bubble over investing in AI.

Is there a danger of overinvesting in, for example, real estate in Saudi Arabia?

Absolutely, I mean I think that that's certainly the case.

Again, there is a build it and they will come aspect to what they're doing.

The Saudis, when you press them on this, will say that you know, they've done the hard work and know that there's demand for all of this.

But if you just look at the scale of the projects that they're doing, these they're not even called mega projects, they're giga projects.

They're enormous, brillion dollar bet on a country.

You have to wonder whether the demand and supply will come together on this.

And again we've seen this before where the Saudis have you know, there had this grand vision for new cities and and they've never come, they've never come to fruition look neo, which is something that the Crown Princess talked a lot about it in many ways as his baby.

They've had to scale that back over and over and over again.

Part of it is engineering and the idea that what he envisions it is extremely difficult to do.

But at the other end of it is just putting a city down in a place where one didn't exist before.

Not only has engineering challenges, but you have to wonder if there wasn't a city there before, why would there need to be a city there now.

So it's those kinds of flights of fancy that I think people need to be worried about when it comes to Saudi.

Arabia coming up.

We hear a lot about economic inequality in the United States, but not nearly as much about how much wealth and time is given away age here as we head into this Thanksgiving holiday in the US, we'll go to the two most charitable places in the nation, Northwest Arkansas and Western Michigan.

This is a story about giving back, and in particular, the single place in America that does it better than anyone else.

Earlier this year, we brought you the story of the wealthiest spot in the country, the residents of Teeton County, Wyoming, have an average annual income of around a half a million dollars.

They also donate more per person than anyone else.

But then it's easy to give more when you have more.

So who gives the most as a proportion of how much they make?

That's another story altogether.

It's a chilly autumn morning in western Michigan and today, like every Sunday, people here are heading to church.

It's a small town.

I mean, we have what two lights, maybe you know, not very big, but I do know that they're very giving.

We genuinely do care about the people that are right next door to us.

You know your neighbors, you know the people that your kids go to school with.

You see them on a daily basis.

Of all the cities, towns, and communities across the United States, building stands apart when it comes to lending a helping hand.

But to understand why, we have to think about the nature of.

Giving GENEROSSI is more than just money.

It's being a family, it's being part.

Of the community.

Community is something Pastor Ryan Snyder and his congregation think about a lot, even more so when we told them what we had found after years of research, Harvard economist Rod Shetty and his team joined the US Census Bureau to create the Opportunity Atlas, a project analyzing billions of data points to learn about the economic fabric of America.

Among the factors they studied was volunteerism, in this case, the share of people in a given place who are members of a volunteer group.

And there is one town, one single zip code that stands above the rest.

You guessed it.

We're just y in town.

I mean, we don't Belding.

Are you kidding here?

We have nothing famous.

I know that Belding has its falls, just like everybody else does.

But one thing I can say about building is that building is willing to support when support is necessary.

Anytime that there's a need, everybody will always step up, no doubt.

According to the Opportunity Atlas, about seven percent of people nationwide are part of a volunteering group.

In building zip code four eight eighth nine, that figure is fifty six percent.

I was born and raised in Belding.

I lived here for a long time and I'm still in this community.

Community isn't just you being in your house and you happen to live next to others.

Community is that you're willing to help others, regardless of your beliefs, regardless of your political stances, regardless of what they look like.

Generosity is an individual act, but it also is an act that responds to the social and environ.

Kevin Fitzpatrick is the director of the Community and Family Institute at the University of Arkansas.

Whether it's an individual characteristic or something that our family always did, or now it's something that our church does, I mean people are brought to generosity through a lot of mechanisms.

Although building might have an especially strong community, it's just one remarkable place in a particularly remarkable state.

Take a look at membership and volunteer groups across the country as a whole, and the competition isn't close.

Michigan is in a league of its own.

We asked Michigan native and former Blackstone vice chairman Tony James why that might be.

I was born in Lyondott As you point out, not many people actually know that.

No one's heard of it.

But now my real connection is I have a summer home in northern Michigan, and people say, do you have a house in near Hampton's You have a place in Nantucket.

Now I go to northern Michigan.

I love northern Michigan.

It's absolutely beautiful.

There aren't many New Yorkers there.

If I told you that of all the states in the Michigan ranked at that top in terms of volunteering, would you be surprised.

I was very surprised, honestly, having said that, that whole Midwestern Bible Belt area was pretty much the same green color.

So it got me thinking about why.

And I think what distinguishes that part of the country is small towns, not really rural like the American West, where there's lots of empty space, and certainly not urban, but small towns and towns that have been struggling, I guess economically for the last twenty five or fifty years, shrinking manufacturing base and so on.

So I think those towns have certain common factors like strong church, strong social institutions, the four H Club, the Boy Scouts, the Elks Club, the VFW, a lot of engagement with kids' schools, and so I think the communities know we each other.

James retired from Blackstone in twenty twenty two after two decades at the firm.

His deep commitment to philanthropy came not so much from his time in Michigan as from his experience in New York and on Wall Street.

At some point, I realized that the people in finance that I most admired weren't just successful in their careers and ran big companies.

They added community service to it.

And it got to the point where the leaders in our industry, if they had the capability of making a difference and the financial resources to make a difference and weren't doing anything.

I started to lose respect for him.

So I decided that there's a message there and that I should start leaning into getting involved with philanthropy.

And I think people are inherently generous.

They do give to the church or to the United Way or something, but until you start leaning in, you don't realize how much impact you can have and how many opportunities there are to make a difference.

Americans spent about five billion hours volunteering in twenty twenty three, valued at around one hundred and sixty seven billion dollars.

But in the richest country in the world, it comes as no surprise that much of our giving is financial.

The US donated almost six hundred billion dollars last year, and New York has the highest total contributions.

Titan County, home of Jackson Hole, generally gives away the highest amount per capita, but the people who donate the most as a proportion of their income live about halfway in between New York and Wyoming, in a place that happens to be Professor Fitzpatrick's backyard.

If you look at philanthropy across northwest Arkansas, we would see that over the last several decades, as the large philanthropic organizations have responded, so too has the individual.

Here in Benton County, Arkansas, the average annual charitable deduction is about fifteen percent of residence income.

That's well above the figure for Teetan County and several times higher than the national average.

So what makes this area so unique?

We asked a local philanthropist.

I moved to northwest Arkansas in two thousand and two with a little bit of a life transition and started working for a small family business for an hourly rate and worked my way up through that company and ultimately was able to buy it from the founder.

Aaron Marshall ran the firm for eight years before selling it, starting his own nonprofit and building housing for hundreds of homeless residents on a site where they had been living intents.

He called it New Beginnings, and although Marshall stepped away from his business to spend more time and money on those around him, he still says the businesses of Northwest Arkansas could be the secret to the area's generosity.

Three businesses in particular.

There's something special about Northwest Arkansas.

It's a unique place where the home of Walmart Tyson, JB.

Hunt.

You know, those families with names that almost anyone would recognize have not only set a tone by their business success and entrepreneurship, but they also set a tone for charitable giving and building the community and making it better over the last thirty years.

For Marshall, giving goes a long way back.

He donated two dollars of the very first twenty he ever earned.

But he also thinks it helps to see firsthand the charity of others and the way that business success and philanthropy can go hand in hand.

I would say that's inspired a whole nother tier of people like me who were running small businesses in support of some of those larger companies or the other companies from around the country.

That support them, And I think that there's hundreds of people like me who live here whose names you'll never hear and wouldn't recognize, that are doing work quietly behind the scenes to make Northwest Arkansas one of the best places to live in our country.

In the context of big giving, there oftentimes is medium and small and tiny giving.

I mean, it's an energy and it's an atmosphere of generosity that gets created.

We have these corporate giants that have done such an amazing job in responding to the needs of not only the local community, but the regional and state communities that it's really inspired a whole generation of givers.

Perhaps the legendary investor and philanthropist Warren Buffett put it best in his note this month to Berkshire Hathaway shareholders.

In the letter, he described his plans to step away from the firm and give away over a billion dollars, writing quote, when you help someone in any of thousands of ways you help the world, kindness is costless but also priceless.

Whether you are religious or not, It's hard to beat the Golden rule as a guide to behavior.

Back in Michigan, pastor Schnyder agrees love.

Your neighbor as yourself, and it's like just being a brother, just being there for someone, regardless of whether or not they've been there for you.

You're okay to just jump in and health, You're okay being there for other people.

What makes America unique in this world is the way private Americans give so generously.

You don't see that anywhere else in.

The whole world.

And our government doesn't support a lot of these charities the way they do.

I think of the museum world, the British Museum to live, they live off government sport.

The Metropol Museum is one hundred percent supported by private flancery and private giving of ours, nothing from the government.

If we shrink that private philanthropy, I think we'll see it a lot of places in the community, and I think it would be a terrible thing.

So I think that's a really important pillar of American society and unique, and we should be grateful for it, not threatening.

Whether it's New York City building or Bentonville.

There are many different ways of looking at giving and of doing it.

Michigan and Arkansas are exceptional, though hardly unique, but in both cases the lessons are clear.

Community matters Generosity is contagious, and giving back can yield unexpected results.

Through your long history of charitable giving, what have you learned what about it has changed in your mind from what you thought originally.

The most satisfaction I've had in my life has not been the business success, the year over year growth, or selling for more than I purchased a company for.

It's walking around the hallways and the sidewalks of new beginnings, talking to somebody who a year ago was unsheltered in the woods, didn't know where their next meal was going to come from, and now they're in a safe environment and they have a plan for permanent housing.

The satisfaction level that comes from giving and investing when you have the ability to do so for people that don't is ten or one hundred x any other experience of my life.

A remarkable return and investment, not in dollars, but in fulfillment.

Generosity pays dividends all its own.

Up.

Next, President Biden wanted more green energy.

President Trump wants more fossil fuels.

We examine whether they both may be right.

This is a story about false choices.

Washington can often seem like a split screen with one party or administration simply taking the other side in endless debates.

We've seen this with energy policy and the back and forth over fossil fuels versus so called green energy.

But on this one, could they both be right?

I sign the most significant climate and clean energy law ever ever in the history of the world.

Do you know what it is?

We have a policy.

It's called Drill, Baby, Drill.

That's our policy.

Two visions now bound by the same reality.

An industry under pressure.

We expect demand for electricity in the United States to grow by about twenty five percent.

Racing to power our ever growing digital appetite.

What we know now is that the nation the country is short of electrons, while millions of Americans are already feeling the strain.

And they just said, Mary, you sold us peace of mind.

When you look at the last few decades, electricity demand in the US is a three part story.

From the early nineteen nineties through about two thousand and five, demand rose steadily as the economy grew and the grid expanded with it.

Then, from two thousand and five to twenty twenty, the trend flattened, efficiency improved, and industries modernized.

But starting around twenty twenty, the pattern shifted again for the first time in more than a decade.

Electricity demand renewed its upward march, and the projections for the future only climb from there.

AI is affecting really everything across the board in the electricity generation sector at the moment.

Ethan Zindler is the head of Country and Policy research at Bloomberg New Energy Finance.

Having served as climate counselor to Treasury Secretary Janet Yellen, he sees efforts by the Trump administration to cut back on green energy as running up against the overall demand for more.

Energy when it comes to the zero carbon or lower carbon energy technology companies.

In some ways, it's the best of times and worst of times.

Worst of times in the sense that some major important subsidies have been removed or in the process of being removed through actions from Congress.

The bill as amended is past, but the best.

Of times aspect of it is the demand for electricity, after essentially being flat for about two decades, is now quite quickly rising.

So this is a real substantial change and something that is providing a good deal of uplift to the industry.

Markets are voting with their wallets as they always do, betting on anything that can build fastest and connect first, green or not.

The engage tracking clean energy is up about fifty percent this year, but behind the boom.

Most of the power supporting that AI growth still comes from gas and coal, as they are set to shoulder much of the next decade's growth in electricity demand.

We've largely solved the production side of energy.

We know how to produce natural gas, we know how to produce oil, We know how to produce electrons.

Our challenge in America today has become getting that product to market.

A challenge.

Dan Briett knows well.

He led the Energy Department in President Trump's first administration, so it wasn't that long ago.

All the talk was about energy independence and now seems to be energy sufficiency from whatever source it comes.

What are we doing to make sure we have sufficient energy?

Beginning with at the federal level, what they're looking at are things like permitting.

One of the challenges to building projects here in America has been the permitting process.

We have a deer mutual friend, and he's the CEO of a major pipeline company.

He has said bluntly, he said, it takes me longer to get the permit than it does to build the pipeline, and that's a problem.

When President Trump returned to office, he said some things that some people interpreted saying, we want to go back to favoring fossil fuels more.

Has there been a shift back towards fossil fuels.

You know, there's been a shift towards the realism that is necessary in energy production.

I think for years and years and years, you know, perhaps as many as ten years, the United States look at energy policy almost exclusively through the lens of environmental policy or environmental science.

And we're going to put the miners back to work.

But when you think about energy and it's importance to our economy, you cannot look at it exclusively through this environmental science lens.

You mentioned oil and natural gas.

There are also alternative sources of energy, some called renewables or green energy.

What is that balance looking like and is it shifting?

It's not shifting very much.

I mean, what we're seeing are more and more renewables being put onto the grid.

That's certainly true, but that's largely capacity, you know, the capacity of ability to make energy.

It's not the production of energy.

Those are two different concepts.

You know, although we see a lot of renewable technologies like solar and wind being put onto the grid, it's important to remember that they only produce the energy about thirty to thirty five maybe forty percent of the time.

But it's going to take all forms of energy that much.

We do know.

According to Bloomberg New Energy Finance data, centers could consume about four point four percent of global electricity by twenty thirty five, and companies representing both sides of the debate race to increase energy production.

There's another build out taking place, one that doesn't depend on the grid for distribution, one that is closer to home.

We have a big increase in the demand for energy.

What is your company doing to help with that?

Oh, we do have an incredible demand increasing demand for energy.

And what I love about what Sunrn is doing is we are providing for Americans an avenue for energy and dependence so they can generate their own energy, they can store their own energy.

Mary Powell is the CEO of sun Run, the nation's largest residential solar and battery company.

She says Americans are not waiting around for Washington to resolve policy differences.

We really pivoted very hard to what I call the storage first company.

We did that a couple of years ago.

We started as a more traditional solar company, so we were about for Americans who wanted solar energy on their home.

We provided that, and then we really pivoted hard to being storage first.

So we put storage in homes and we pair it with solar so that they have a form of generation for storing in their home.

That's not exclusive.

You know, once you have a storage device in your home, you can be using grid energy as well to build up your storage capacity so that you, as a consumer don't have to experience grid outages, which as I think we all know, are increasing rapidly around much of the country.

And at the same time rates have gone way up, so it gives consumers a way to generate, store and control their energy cost.

Just this year, we have dispatched seven hundred times back to the grid, and at the same time, when we do that, we provide some value back to that consumer because of course, as we should, we get compensated for that capacity.

So some of that goes for increased value for sun Run and it gets shared with the customers.

And the markets have taken notice sunrun stock surged this year on strong cash flow and record installation.

You've talked about residential.

Do you also have commercial applications or are you residential specific?

No, we are all about residential.

I feel like for ten years I've talked about one of the greatest hopes I have for America's grid in terms of affordability, is you know, being the tip of the sphere on a consumer led revolution.

That's really how I see it.

Like, there's innovation now, there's new technologies available that consumers are going to want to rapidly adopt.

And then what's really cool is we can use those resources to help make the grid more affordable for all.

But making power more affordable is growing more difficult.

A Bloomberg analysis shows wholesale electricity prices in some US regions have surged as much as two hundred and sixty seven percent over the past five years, mostly in areas dominated by data center growth.

Running a utility it's really hard work, and it's really hard even when people agree, regulators, politicians, etc.

That you need more resources.

As a country, we really went from Nimbi you know, not in my backyard, to Banana, which is you know, build absolutely nothing anywhere near anyone.

So you know, again, this is capacity that's being built because consumers are deciding that they want to take more control of their energy.

The same impulse driving consumers to take control of their energy supply is now shaping national policy as the races to compete in a global energy race, a race with national security as well as economic stakes.

Particularly for the market for batteries, the US has really heavily lied on China to provide the large scale batteries that are used for so called utility scale projects.

The new One Big, Beautiful Bill includes a provision that specifically attempts to turn the market away from foreign made batteries.

If you want to qualify for tax credits in a couple of years, you will need to be using American made equipment, or at least not Chinese made equipment.

I think many of the countries around the world are beginning to understand the importance of energy to not only do their economic security, but their national security.

And that's why you're starting to see in many cases the policies shift in the way that they.

Are from nations to homes.

I don't see this consumer led revolution as the.

Solution whether it's green or not.

I see us being a really critical resource for flexible, resilient solutions for utilities.

In the end, it's about power in every sense of the word.

This is a real substantial change.

And one reality cuts through every debate.

We're going to need all of it in order to meet the demand curve.

Coming up, another Formula one season, another win for Team McLaren and its leader Zach Brown.

He's here to tell us his remarkable story from self described troublemaker in high school in California to the very top of the biggest sporting competition in the world.

This is a story about the fear of failure, something Zach Brown and McLaren haven't experienced a lot of lately.

The team has already won Formula one's Instructors Championship, and it has Lando Norris and Oscar Piastri numbers one and two in the driver standings going into the Las Vegas Grand Prix.

But for the team CEO, the path to the top has been an unusual one, and it all started with Mickey Mantle.

The motor racing great.

Bruce McLaren once said, whatever we do, we must do it better than anyone else and long before Zach Brown ran the famed Papaya colored racing team, that McLaren's spirit was alive and well.

I read in TV Guide that Mickey Mantle played golfit Prussian Trails country Club.

F I'm twelve thirteen years old and I'm calling the country club every day.

Is Mickey Manelin?

Is Mickey Manolin?

Now?

One day they go hold on and I'm like, oh my god, like, how might talk to Mickey Mantle.

Fifteen minutes go by, They've called him in off the golf course.

I can see why he was a bit upset being a golfer.

Now and she picks up the phone and he said hello, and I'm like, is this Mickey Mantle?

And he chewed me out like there was no tomorrow.

I'm in my room crying my eyes out, and my mom came in and went, what's going on?

I told her the stories.

She disappeared, got him back on the phone.

He thought it was a prank, didn't know it was twelve thirteen year old kid.

My mom came in said, you and your brother pack your bags.

We're going to Dallas tomorrow.

We're going to meet with Mickey Mannel.

And we spent half a day with Mickey Mannal's most unbelievable experience.

Whether it's meeting his heroes or chasing Formula One championships.

Brown is a hustler.

I love the art of the deal, you know, there's an adrenaline.

To that and a winner.

I'm definitely motivated by the fear of defeat.

I think it's the unhealthier, more stressful version.

But that's how I've back when I was racing, like I just didn't want to lose as opposed to I really want to win.

That's what gets you out of bed every day.

My first collecting criteria as the car had to have won a racing period.

We met the McLaren Racing CEO at the Classic Car Club of Manhattan ahead of the launch of his new book, Seven tenths of a Second.

Brown is one of the highest paid executives in Formula One, taking home fifty million dollars last year, a reward for an executive who has returned one of motorsport's most storied teams to the top of Formula One.

It almost feels harder because when now we're at the top of the mountain, there's only one way to go, and this is sport right.

That terrifies me and that's why I get up every day.

It's like I know the storm is coming, but I want to kind of keep pushing it back as much as possible and just keep doing what we're doing.

Zach Brown wasn't born into this world, and growing up in California, he might not have seemed like the type who would go on to run a multi billion dollar Formula One team.

I was a bit of the troublemaker, was a bit of the classic class.

I did get in a baseball and in work experience, which were my two loves.

Had there been a racing class.

I'm sure I would have done well with history, science, math, just not that exciting for me.

Brown's path to racing wasn't the usual one, if there is such a thing.

It all started on a nineteen eighty four appearance on Wheel of Fortune.

Zach three fifty dollars identify this person.

While Bill Hiccock, Yeah, that's.

It, and the deal making followed.

So I asked Mario Andretti, how do you get started in racing?

He said, karting.

Then there happened to be an ad in the race program for Jim Halcart racing school.

I had previously been on Wheel of Fortune teen Week when I was thirteen years old.

I won.

That was back in the day where you won prizes.

So I had this stash of his and her watches.

What am I going to do with these things?

So I went and sold them at a pawn shop in man Eyes.

Took that money, bought a goat cart and got started racing in karting.

And then it was kind of school of hard knocks.

I didn't know how do you advance.

My mom, being a travel agent, she found someone at TWA Airlines.

It was passionate about racing.

They gave me some airline tickets.

I'd go sell those airline tickets to pay for racing, And that's kind of how the racing career got started.

If you're really going to motor racing, you need some financial support from someplace.

Now, some people have wealthy parents or wealthy backers and things like that.

You didn't necessarily have that.

Your parents were much more middle class, So how did you afford it?

So I started to learn how to do sponsorship.

I remember my mom and dad kind of talking about how they could help me, and so my mom gave me her salary for a year, which was about thirty forty thousand dollars, a lot of money, but in the big scheme of things from racing, you know those families that I've spend millions and tens of millions.

So it was kind of enough to get me started, but not for a full season.

So then I didn't know anything about sponsorship, but I got fully immersed in how to sponsorship work, and really it trained me to this day, which was I needed to understand what companies wanted to do with their business and how I could use motor racing to help them achieve their goals, something that I still have with me to this day.

So I just started calling everyone.

Mickey Mantlestyle, ninety five out of one hundred people wuldn't even take your phone call, but I was so desperate to.

Be in racing.

Just keep calling, keep calling, keep calling, and started kind of knocking down doors, building relationships and figuring it out as I went along, and then ended up getting pretty good at a sponsorship by understanding what companies needed and how motor racing can help them achieve their goals.

Brown was a good racer but never made it to f one.

He did, however, have a knack for deal making, and so in two thousand and one he founded a motorsport marketing firm, JMI, which helped establish Brown as a major force at the intersection of racing and business.

He sold it in twenty thirteen and joined McLaren three years later.

What he came into was a mess.

If we were not competitive on track.

We were ninth in the championship.

I know, I can't design a better race car.

We were at rock bottom as far as sponsorship that I knew I could make a difference on.

And then morale, which was really our biggest challenge was people were working well together and it was a bit of a rudderless ship because there were so many things going on at the board and there was I don't know, three or four bosses that were in and out.

So I think any company, forget about whether it's a racing team, just any company.

If you've got a lack of overall.

Leadership because of what was going on, then it's going to be hard to kind of build momentum.

So first thing I worked on was trying to fix the economics because I felt that was my sweet spot.

Trying to get everyone to kind of believe and then ultimately, if I could get everyone to believe in the economics, and then the massively talented people that could design a faster race car, I could get them the tools that they need.

And then drivers are something that I'm very comfortable with, and so bringing in Lando Norris and then of course Oscar.

But we had great drivers in Oscar, and we had a great driver lineup, so tackled trying to kind of build momentum, and we got that momentum going and then it just accelerated.

When Brown joined McLaren in twenty sixteen, the team was recording steady losses and languished at the foot of the F one table, but it reversed that under Brown, raising its annual revenue and climbing the standings, culminating and winning the title in twenty twenty four.

Brown says changing the team's culture was a big part of the turnaround.

I'm sure there are people that wouldn't fit in our culture, but I think that's what makes McLaren so special, as we've created a cold sure that we all buy into.

We're all like minded.

I have no yes.

People on the team.

You know, everyone can speak up.

I get upset if they don't, and they know they can.

I get upset if they don't challenge me.

My job is to, you know, sometimes put the puck on the ice and all come in with a view, sometimes an even very strong view, and all I'll do a onet eighty if you know, I hear from my team.

Actually, Zach, I don't think you're thinking about that the right way.

And it takes some time for people to get comfortable kind of challenging the CEO.

But I get upset if they don't, so they know they're not allowed.

To hold back.

I'll get very grumpy if it's like, well I thought this, I just didn't say anything.

So everyone on our team speaks up.

But then once we align around what we're gonna do, we all hold hands and we're in this together.

And you'll never be able to tell if everyone if it was a unanimous vote or a majority, And it's okay to have a difference of opinion.

That's that's welcomed.

It's kind of you know, coming back to racing, and I've learned so much about being a driver that I think is relevant to being a CEO.

So you need to be able to listen well to your engineers.

You need to be able to communicate well.

You need to have a lot of trust in your team.

It's life or death.

You need to be very data driven, and you need to chase perfection, but know that you're actually never going to be perfect.

There's no such thing as a perfect lap, a perfect race car.

So you need to have a group of people that kind of happy, always being like, well, that's just not good enough.

We're fortunate in our careers if we find a person, two persons, three peer people that we can look up to and borrow from and learn from carry with us.

We already mentioned Mickey Mantle and Mario Andretti, pretty big names.

Are there other people that you really treasure in your experience with?

Oh yeah, Roger Penske would have to be right at the top.

While he's been a massively more successful, but I'm still going well, so is he, which is what's amazing.

He'll never stop, you know.

He started off as a racer, built a great team, built a great business, understood how to use his racing to build his business, knows how to build his racing team office business.

So I kind of was in the business of racing.

So a lot of similarities.

He's a racer, He's been in Formula One in IndyCar.

You know, the only thing he hasn't won is the twenty four Hours Lama and he's eighty plus years old staying up twenty four hours still trying to win the twenty four Hours of Lama.

So surrounded himself with great people always.

He was to me growing up in America, he was the McLaren of North America because they even shared the same sponsorship.

So the Penske IndyCar looked like the McLaren Formula One.

Car from the eighties and nineties.

So I think Roger Penske is someone that's right at the top of the list of someone that've got huge admiration for.

Roger Penske owns IndyCar as well as the Indianapolis Motor Speedway, and his team has won more Indianapolis five hundred races than any other in history.

I've known Zach when he was from Indianapolis and he had a company that really managed sponsors for different race teams.

And remember sitting down with him at the airport at Indianapolis and he told me he hit two choices.

He could either potentially put his hand up to run IndyCar or number two.

You have a chance to maybe become the CEO of McLaren.

Well, he went one direction, we've gone another.

He's done a terrific job when you look at what he's brought to McLaren from a corporate perspective.

He's a great guy on talent.

He knows how to go get the best and he's a tough guy to deal with when the standpoint or compete with.

And he's really done it on his own.

I mean, he's got good people.

But the McLaren name has been terrific.

I'm racing with Bruce McLarin and he's taken that to the top, and with his two young drivers this year actually racing each other for the World Championship is amazing.

But he's a leader.

I think he's a tough competitor and I can tell you one thing he doesn't like to lose.

That fear of failure has driven Brown from a self described punk to the very top of Formula one.

What would you today say to Zach Brown when you were in high school, if he could walk into the room, what would you say to him.

I'd probably get in a fight with him.

I don't know who'd win.

Brown might not know who'd win, but you can guarantee neither would be happy losing.

That does it for us here at Wall Street Week, I'm David Weston.

See you next week for more stories of capitalism s