#25 - Morris Kahn on Serendipity, Forging Strong Relationships and Taking Chances

My name is Boris Khan. This is MBA without BS. BS is bullshit, no? Okay. Welcome to MBA without BS, where I speak with top voices in business, education, and the business of education. I've had the unusual luck and pleasure of interviewing Mr. Morris Khan. Morris at 90 is more vital, more alive, more vibrant than most 20, 30, 40-year-old people I've met. And he is just a force, positive, optimistic, good-natured man who's done so much in his life, that it was difficult for us to kind of encompass it in this podcast, but we were trying to go deeper and deeper and kind of see where the road takes us. And I've had a really outstanding time. And if you don't know Morris, he is a South African-born Israeli entrepreneur, self-made billionaire, who's built some of the biggest companies in Israel, namely Amdox, the Golden Pages, what we call the underwater observatory, but the core world, which operates, numerous underwater observatories all over the globe. And in recent years, Morris has been focusing on philanthropy, you know, he launched a spaceship to the moon. He's helped a lot of people by providing the access to surgeries to eye surgeries, basically turning the tide on blindness and very specific parts of the world. And it was really a conversation that was full of perspective, you know, introspective, but also historical perspective on how things used to be and how they are right now. And I've really, really enjoyed it, and I hope you do too. So this episode is kind of cut in the middle. We had a very long talk over five hours, but you're only going to listen to 45. And when the time is right, maybe we'll release the next episode. That's it. Hope you enjoy it. I know I did very, very much. Happy listening. So Morris, welcome to MBA without BS. It's great having you here. Thank you very much. It's an honor. The honor is mine, and thank you for the hospitality. And Morris, I'm going to start with you the way we start with every guest, although it's going to be more challenging in your case. So please tell us your story in two minutes or under. Okay. So I'll start off. I come from a family that not particularly rich. Actually, my father was a minor. He worked six thousand feet underground supervising a gang of Africans digging the gold, the rock, to come up. Not an easy job, not a highly paid job. I actually came to Israel when I was about 25 on a visit. And I decided I wanted to come back and live here. And when I was 26, sold my businesses, I had not a whole lot of money, but enough to come to Israel by a calca in Vietnam, which I did. And I thought I'd be a farmer for a little while and a few retire. I felt that it was a good time. If I lived modestly, I had enough money coming in. I could live with my kids and retire. I thought 26 is a good age. While you're young, you can enjoy your children. That's the time to retire. It was exciting in the beginning, but I realized that Israel needed to create employment for all the new immigrants who are coming in. I got involved with a bicycle factory with Kibbutz Sura. I did a whole lot of things financially, not too great. I didn't do very well in the beginning. It took me quite a long time. There was a bit of a struggle, but eventually I made it. I've been very lucky. I appreciate my good luck and my good fortune. I'm not hooked on money. I like to do things. I've been fortunate. It worked out well. I've got a good attitude. It's actually helped me in good state. I have to complete the picture or the listeners. Just a bit with your permission. I will only touch on very few things. That is that Morris built some of the biggest companies in Israel, starting from the Pizav and in Utesav and later Amdox, which my wife's father works in for many, many years. On top of that and alongside of that, a lot of philanthropic projects from sending a spaceship to the moon and helping kids in Ethiopia gain their eyesight. Before we deep dive into all of that, I want to ask you, you have an unusual dive buddy. Who is my dive buddy? Maybe more than one, but maybe you can tell us a bit about diving before we go anywhere else about the hobbies. When I came to Israel, we had this little house in Betjanae and we would go down to a lunch and we would put up a tent on the beach opposite what's known as the Japanese garden. It was absolutely beautiful. I loved it. I fell in love with a sea, with a coral, with a fish and I spent some lovely holidays in a lot with my family and friends and I would go diving and it was the first time that I learned to dive was when I came to Israel and I got my kids when they were old enough. They were the same and a few years later, I took my children down to Sinai. We were diving and my younger son got a little bit caught up with what's called the rapture of the depths, going deeper, getting a little bit of nitrogen or coasters. I realized that I had to stop him and my ear blocked I should have gone up and equalized but I thought I would lose him. I pushed on and I burst an ear drum quite deep and I managed to stop him. I came up. The world was floating around. I'd lost my balance and when I got to the shore I actually found myself a little bit giddy and I went to a doctor who checked my ears and he said what depth were you at? I said about 70 meters. So he said that of course you 70 shekel. I think we're 70 lira. He said it's a lira, a meter. But for that holiday I couldn't I couldn't dive and I realized I got together with people on the beach and I realized a lot of people come to a lot. They don't see the coral, they don't see the fish, they don't see the wonderful scenery that we have down there and I felt this is a real shame and I got to find a way of helping them to get done and I came up with a concept of the underwater observatory. I decided to build an observatory that would get people down, enabling them to see the coral and the fish without diving, without getting wet. The beach in the sea was controlled by schmurrta teva and the director of schmurrta teva told me you will build an underwater observatory on my over my dead body. I said to him are you really serious? He said yes. I said well in which case I've got a piece of advice for you. He said what's that? I said teach your son to say Kadesh. I've got a way. Of course if it's over your dead body I'm going to build it. So the fortunately for me the nature reserve was run by Avramyafi, a Lufyafi. And he saw my intent and he understood what I wanted to do and I said I can get people underwater without disturbing the reef and they're getting them to see it and he actually supported me and he gave me permission and I didn't have a whole lot of money. I got hold of Jacob Levinson who was the monk of Bunkapurlim and also I think he was the secretary of Kibratovdim and he actually decided to support me. He wanted to do something for the people of Elat. I wanted to do something for the people of Israel and I designed this thing together with some engineers. I bought it in Hiyarka which is a Druze village, brought the pieces down to Elat, assembled them on the beach, pushed this big tower into the water and that's the story of its own and I got it done and it turned out to be an amazing project. It enabled people to go down underwater, look at the coral and the fish and I got tremendous satisfaction when I would go down and I would see these young children who would look through the windows and see things that they had never seen or imagined in their lives and this gave me tremendous satisfaction and it turned out to be financially very very successful. I had no idea how it was going to work. It was a bit of a gamble but the gamble worked out and it really turned out to be a really a major project and I think is the major attraction in Elat today. I agree. I worked in Elat as a diving instructor and a free diving instructor for a few years and I know the area quite well and every now and then on the way to Tabah on the left you know we would stop just before the Macdalor, we would stop at the Shmula and the observatory and visit the sites and I think it's an outstanding you know monument in Elat and one that is frequently visited which is I think that's the big thing. The fact that people get to explore the underwater world through that you know and so many people throughout so many years. It's something else. So I mentioned a dive buddy. I was tipped that sometimes you dive or you used to dive or you still dive with Bos Aldrin, the second man on the moon. Maybe we'll pivot to space in a second but I did want to ask you you know you built something that was completely new. The concept was innovative and what role did the city, the authorities, the country play in supporting that venture? Well first of all I just would like to sort of make one point. I really know very little about fish. I'm not a marine biologist. I know very little about coral but I was captured by the beauty of nature and I was helped by a person called David Friedman. David Friedman he had a small aquarium in Elat. It was like a small bedroom which was the size of a small bedroom with little fish tanks around and David really was really in love with the sea and David understood the sea and it started off. I said David would you like me to build you an aquarium in Elat? So he looked at me with pity and ease eyes and he said do you know how many people have offered to build me an aquarium and he said nobody ever does and I said David if I say we'll build you an aquarium I'll build you an aquarium. So he said yellow let's go. So and David was an artist and artist and putting coral and fish together. He was really an artist and David provided the know-how and I provided the possibility for him to do what we both wanted to do and it turned out to be a very nice relationship. Unfortunately David was a young South American good looking lovely long wavy hair. David didn't like wearing a hat he thought it detracted from his good looks and I begged him I begged him to really take care. He didn't and David eventually was caught. He developed a mellow gnome from the sun and this eventually killed him. If he'd taken my advice he would have still been with me today and I'm really sorry about that. And other than the venture team David and yourself the knowledge and the entrepreneurial spirit were there other factors that were involved or that you felt you needed to harness in order to make this dream into a reality. Well first of all it was actually an engineering challenge. I began to look for companies that could build an underwater observatory and put it for me in the water. Nobody knew what I was talking about. A Japanese company offered to do it for me and it would have cost a fortune. We didn't have that kind of money. So we had to be innovative and as I said before we came up with the design. We'd build it out of steel. We'd construct it on the beach. We'd push it into the water. We would actually then sink it and anchor it and we had to do everything economically. Now I started this project just before the Yom Kippur War and we were caught in the middle and we had to stop and when the war was over I realized and I had experienced I was sort of as exposed to what happened in the war. I realized there were a lot of tank treads all over Sinai and I could bring these tank treads and use them as bellows to keep this underwater observatory down and if you dive today you can still see the tank treads on the base keeping the underwater observatory locked into the sea, locked into the base. So it requires a lot of you've got a lot of people who have got imagination but they run into problems when they have to execute what they've done. You've got to be innovative, you've got to really think out of the box and basically we built something new and it turned out to be amazing, really amazing and financially it turned out to be the best investment that I've ever made in my life. It was designed primarily to expose people to the underwater beauty and it turned out to be a very good investment. Wow, who would have known? Nobody could have known and then actually I felt that this is something we could do in other parts of the world. So I was invited, I had somebody here for Mexico and he invited me to come to Mexico and build an underwater observatory in Mexico and on the way to Mexico I stopped in at the Virgin Islands in the Caribbean, St. Thomas, the one of the U.S. Virgin Islands and I saw the beautiful coral there and I saw all the tourists and I could see that this would be a good business and it's quite a long story as to what happened. I discovered there was somebody else that picked up the idea as well and he was a local island though and he decided to build an underwater observatory so he's asked somebody to introduce me to him and they did and I told him that what I did and I told him that I understood that he wanted to do the same and I didn't want to get into competition with him. I didn't want to compete with a local islander who had the same idea and he had a piece of land that he'd identified as being the right spot and I said to him look I've had experience in this I'm prepared to help you so he asked me why would you want to help me when really you potentially could compete with me I said I'm not going to compete with you I'm not going to do it but if I can help you I'd like to and he said but why would you help me he was a little bit suspicious and I said look if we can't help each other on this world so what are we doing here so he said fine he showed me his plans and I said you know this plan that you've got will not work this this underwater observatory that you plan will not sit on the sea floor it'll float he said how do you work that out I said look I'm not an engineer but I can make a calculation and he said a funny thing is this was designed by Rockwell I think Rockwell he was designed by a company that had just put a module on the moon wow and they designed it for me and I said and I'm telling you it will not sit on the sea floor he said you know you the second person has told me the same thing so I said check it so then he said look I've got an admission to make everybody on the island knows that I'm building an underwater observatory but it's too much for me I don't know what I'm doing I feel lost but my reputation is really at stake so maybe you would help me I said of course I will so he said look just give me a small share and you build it and it's your project so I said fine and I we did that and he became my partner and I built this underwater observatory in St Thomas in the Virgin Islands a beautiful project and the Virgin Islands are really beautiful and then we built another one in the Bahamas and then later on my son took over the business and he built one in he built one in Hawaii I'd been trying to do that for a long time but he succeeded and then we built another one in Spain and this hobby became a business but I really did all of this while I was working as the manager of the Yellow Pages for IT and Chief I did this in my spare time your your side business this is my side business you you touched on taking the tanks from Yom Kippur War and putting them you know submerging them to hold the structure yeah and they remember you telling the story of what I identified as guerrilla marketing to an extent yeah with yellow pages in the war right you might share that story with me actually I was managing the yellow pages the war broke out and most about people who could who were in the army were mobilized and I realized that there was no contact between the people who were fighting and losing their lives and their families and they were very concerned we see we now live in an urge we have got your cellular telephone and everybody speaks to everybody then there was no connection at all and what I did was I I got my staff and we put together teams I raised money and we went to the field we went to the front both in the north and in the south and we actually went to the soldiers in the front lines and gave them goodies you know newspapers chocolate cigarettes and I got from their messages which we were then transmit to Tel Aviv and then convey these messages to their families and every message that we would give a family that their son or their husband was alive and well they would break into tears and we got through 50,000 messages in the first three weeks of the war and when we went to the front we would find these people the trenches and they say who are you guys we say we're from the yellow pages from the golden pages and we got through these 50,000 messages every message was really very very emotional and it actually held us in good stead because when the war was over and our salesman would come to to sell a project they would say we remember you we remember you you guys from the Yom Kippur War so it actually really did us good but that was not the intention and that was not why I why I did it and when the when the war was over this actually played a role in my future in my future really because when what happened was managing a company for an international company you have constant contact with them they monitor your progress and what you do during the war there was no contact at all which meant that they had no concern they really had no concern for us there was no but they that in my book they should have phoned and said how are you doing can we help you is everybody all right but they didn't so I realized that we were just a business for them there was nothing personal at all and basically when they when the war was over manager came and asked me what I did I told him I closed the company down during the war made it a communications network between soldiers in the front and their families and we got through 50,000 messages and he said to me what did it cost I said about $200,000 as my guess he said you spent $200,000 of company money without getting approval I said absolutely if you want me to run this like an ugly American company in Israel you can have my resignation right now this is Israel when Israeli company we stand or fall what happens in this country and at that point they had lost my loyalty I would work for them but no longer with a loyal dedication which cost them the company in the long run and this is the second time in five minutes of conversation that there is a story of you aiming to do something good for the common good like the observatory and like delivering messages and it later turns out to be an outstanding business absolutely and actually the second thing of them losing my loyalty really cost them the business and that's an interesting story in itself you'd like to hear it I would very much like to hear it okay ITT was an American company and they were negotiating a contract in Saudi Arabia and it was a time of the era boycott and they had a sign in the effort of it that they had no business connection in Israel and they had a problem and they couldn't just sell the company in order to meet the era boycott because that's against the law in America you cannot give into the boycott so they were actually caught they had a problem so I told them that I would find them a buyer and I did that I found them a buyer and here I am the buyer was me and the buyer was me yes and it turned out to be that turned out to be a really lucky break that was when I became an owner of a business and not just a manager that happened because they lost my loyalty they didn't show a sense of identification with us which is what I felt I felt we needed I was giving them my all they should have really had that they really should have had the feeling that they were actually doing something for this country so I had a stroke of luck and that luck actually was the turning point in my career how so how so because I became ultimately the owner of the other purges and then and then I and then I had another stroke of luck there was a person by the name of ishi livi he was the he'd been the the month call of Raphael he was the Mifakad of Khilakashu he was the director general of the ministry of defense and he was also at some point the minister the director of the of the department of communications in Israel for the for for the government yeah and he he left the country because he as a director general of the ministry of defense he'd worked with every big company in Israel right and he was a person of tremendous to he was a tremendously ethical person and he said I can't deal with these people privately and I once dealt with them in the ministry there's a conflict of interest so he went to the United States and he worked for composite and he wanted to come back to Israel but he couldn't he wanted to work for somebody who he was not connected to when he was a director general of the ministry defense and I met him and I said come and work for me and he said what do you want for me I said I want you to just be there that I can consult you and you can give me advice that's all I want and he said you know what I'm with you I gave him a salary of fifty thousand dollars a year a motor car an office and a secretary and I could talk to him and one day he said let's talk about your business what is your business I said we sell advertising in the yellow pages he said no you don't understand your business you are in the information business and information is the business of the future and you've got to leverage the fact that you're in the information business and that little switch that little piece of advice that little piece of guidance really took us to where we went to and that was ultimately M. M. Docks but that's another story all of a sudden but it came from the change in thinking that we got from Ishi Levine and we owe it to him and that was another piece of good fortune which came to me I wanted to help him and he actually helped me why do you think luck meets you so often and big strokes of luck as you define them I call them something else but that's besides the point I think the I think opportunities pass people all the time I think they've just got to recognize it and go with it and I regard myself as fortunate I really do regard myself as very very fortunate I appreciate everything that's happened to me I think it's an from the outside it always looks like much more than luck you know it's it's grit determination vision you know you've built things it's it's not pizukhi it's it's big things you know companies that employ tens of thousands of people impacting the the the social morale in in war taking people underwater you know to to show them a whole new world so it's it's taking a spaceship to the moon I mean it's not minor things no but I regard it as like I regard myself as being very fortunate I don't think it's just a skill that I have basically I'm not a good manager you know I'm not at all I'm I'm creative I'm a imaginative I sometimes do things that are off the wall yeah I personally look upon it as luck would you define yourself as a good not an excellent not the best but as a good salesperson as well I'll tell you what I think I do have I do have the good fortune of being able to communicate with people and and get their trust I think people to some extent they trust me and I think I think this trust comes from the fact that I my intentions are good and I think I think it converges off if I have one skill I think it's actually human relations it's actually it's actually connecting with people and it's these relationships that have got me to where I am and if you were to give advice to a young woman or a young man on how to be a good communicator on how to be a trustworthy person on how to gain the trust of others in personal life or in business what would be your advice I'd say first of all be trustworthy yourself and that actually conveys itself you know people sense very quickly what you're up to people see through you very quickly it's it's not something tangible but it comes across but having said that you have to be careful and I learned to listen when I was very young and I had a jury shop in South Africa and somebody was selling cuckoo clocks you know the cuckoo clocks and the miners loved it and the person who was selling me these cuckoo clocks I saw one day that he'd put my company on his letterhead as though I was a branch of his business and I said to my mother he's such a decent guy how does he come to do a thing like this and she said you will never be taken for a ride by somebody who looks like a criminal and appears to be a criminal it's people who actually are very smooth and very nice but they're not really so beware so it's a little bit of an intangible quality that you've got to kind of you've got to get get across you've got to use your nose sometimes yes you've got to have that feeling yeah so we spoke a bit about the the underwater world and the that venture and we spoke a bit about what was the early stages of amdox with your permission I would like to take a leap forward in time because I mentioned or twice in the conversation we mentioned space related things right the company that build the or plan the observatory in in the virgin islands and actually more than twice but and buzz who was your dive buddy or is your dive buddy and I'm going to a few years not too too long ago maybe a year ago where you were the the founder and the main supporter of launching an Israeli spaceship to the moon why did you do that well first of all I belong to a group called sea space symposium it's a group of people in the United States who are involved with the ocean and with space with ocean engineering and people in NASA people have been on the moon like Buzz Aldrin people are involved with the space here industry people from NASA and I got involved with them because they invited me one day to to give a little talk to their group on underwater ecotourism and I went to this group they were in I think we were in the island of Turks and Cacos in the Caribbean and a lecture was being given by a person from I think the company is called electric boat they build the nuclear submarines for the United States government wow and he gave a very high powered presentation really professional and now this was really a high tech presentation by the CEO of a very very big company building submarines is not simple and then I had to come and present a story about building underwater observatories and and I was a little bit embarrassed really but I may have made the presentation and I told them that was high tech and now I'm going to give you a little talk which is low tech but they fell in love with the idea because this group goes diving twice a year in different parts of the world and diving an underwater scenery is part of their ethos and at the end of my presentation they asked me if I'd like to become a member and I said I would like to they said excuse us they took a quick boat and they invited me to join them and for a long time I was the only Gentile I was the only non-gentile and I was the only non-American part of this group and I would go with them twice a year to different parts of the world would get together and they're a wonderful group of people and Buzz Aldrin is one of is one of this group and it for me was it gave me an exposure to space so when the when the when the situation arose in Israel I already had this orientation and Google launched a competition and the competition was for a private group non-government to build a spacecraft and land on the moon and three young engineers decided to participate I went to a lecture at the Tel Aviv University by the one of the CEOs of NASA and at the end of the lecture I these three young boys stood up and said we're going to we're going to participate in this competition so I congratulated them I asked them if they had any money and they said no we don't have any money and I said how do you expect to get this project going without money they said we hadn't thought of it so I said so I'll show you what you come to my office I'll give you a hundred thousand dollars no questions asked and you start and that was how I got involved I wasn't sucked into the project I sucked myself into the project so I couldn't blame anybody for what happened and I got involved with them and I helped them try to raise a little bit of money and we started and we began working and I realized that actually between the three of them this project was not going to fly it needed a manager so I helped them find a manager we found a guy called Aaron Prieveman so I find them a manager Aaron Prieveman and we got the project kind of moving but this project took a long time and at some point in time I realized that we needed somebody who had different qualifications and we got Edo and Tebby and Edo and Tebby a year before we finished he took the project on and I took his credit he finished this project on time on budget and ready to be shipped and really I owe to both of these managers I give them the credit for their contribution to actually making the project successful and about the project being successful there's a question because we crashed we crashed on the moon but we actually got to the moon and getting to the moon was not simple we didn't have a major rocket that we just shoot for straight from here to the moon which is what the major powers do we had to develop a very intricate improvised manner of having circuits around the earth a bigger circuit and a bigger one until we got into the orbit of the moon and the gravity of the moon would pull us in this was very innovative thinking it got us to the moon Israel got to the moon and the world recognized that we got there the fact that the last 10 seconds we lost control of the craft does not detract from the fact that Israel really got to the moon and what impact do you think this will have on future generations now people ask me why did you do this and one was I wanted to help Tussi Ivoryt get into space and I think we did that as a matter of fact they developed after we had got there they actually developed two contracts to build a spacecraft to go to the moon I'm not sure where they stand with these projects but we actually got Israel aircraft industry into space the second thing on the peps the most important was to excite Israeli use not only Israeli use but young people to get it to get exposed to science to space to technology and in Israel we did that everybody when we when we were ready to land everybody was there they were all listening these young kids of six and seven were sitting up at night watching the television they were excited and I think I think we did something and I think I think that we will find one day there are a lot of young people who have gone into gone into professions as a result of the early excitement that we actually created in their minds and how would you go about preserving and increasing that excitement so maybe one day Israel would become or the children of Israel would become well I think that space I always continuing and what they are doing now is they are doing exactly this they are actually they're using the resources that we have they're going to schools they're giving lectures they're exposing young people to what we did so I think that the that the tradition that we we we created continues there's still the rest of the group who want to put a spacecraft on the moon for Israel I really wish them luck yeah I personally think I have done my share I don't it this was eight years of really of really sweating it out I put in a lot of money myself I think I spent about fifty million dollars five oh of my own money and I must tell you I think it's money world spent it gave me a lot of satisfaction to see the impact of what we did and this satisfaction you cannot buy for money and when I see young children on Purim dressed up as spacemen you and I see some of them even dressed up as spacecraft this kind of satisfaction you cannot buy for money so I regard myself as fortunate it just turned out that way thanks for listening hope you've enjoyed it if you did please rate and comment on your favorite platform we're on iTunes and Spotify and SoundCloud and Anchor and many many more you're also welcome to check out our website mbawobs.com for past episodes and to subscribe and stay tuned for our future episodes so check it out