Origin Story Interview w/ Todd Khozein, SecondMuse

Origin Story Interview w/ Todd Khozein, SecondMuse

Brighter Future

 / 

May 3, 2023

#BrighterFuture #entrepreneurship #Sustainability #ClimateChangeSolution #originstoryseries #seekthechange #resilienteconomies #InnovationForChange #CollaborativeSolutions #InnovationForChange #SustainableBusiness

Brighter Future

We’re here with Todd Khozein, the founder of SecondMuse, an impact and innovation company building resilient economies by supporting entrepreneurs and the ecosystems around them.

Thank you so much for joining us, Todd. Do you think you could tell us a little about yourself and your business?

My name is Todd Khozein, and I was born in Iran and raised in Ecuador. Currently, I reside in Portland, Oregon. I am the Co-Founder and Co-CEO of SecondMuse, an organisation that brings communities together to build economies that benefit people and heal the planet.

Can you briefly explain your business and its goals? How does it contribute to the world?

We create positive change in economic systems that are defined by their ability to avoid causing harm and bring about healing. We do this by working with communities focused on climate, equity and tech to create solutions to the world’s biggest challenges. By identifying opportunities when economies are most influenceable, we take advantage of these moments to shift the culture and composition of the economy towards equality. Economies can simultaneously be profitable, caring, compassionate, and impactful; these qualities are not mutually exclusive.

When we examine the development of economies locally and globally throughout human history, we see that they do not equally benefit everyone. Our economy often causes harm to people, with only a small number of winners and many more who suffer. And the economy doesn’t just harm people— it has harmed the environment on a global scale for centuries. Now we are beginning to really experience the effects of climate change. Ultimately, we all suffer because of our economic systems, though some have suffered more than others, and for longer: this is true in particular for the participation of women and minority groups, including indigenous communities. These are historical and common phenomena not limited to Western economies.

Economic growth should not come at the cost of human dignity or the environment. Instead, the best economies should give everyone a negotiating seat and a presence where diverse ideas and perspectives can be shared. It leads to greater innovation, as we have seen in fields such as genetics, where the integration of biology with computer science has significantly increased our understanding of the biosphere. Our diverse life experiences, shaped by factors such as our beliefs, parents, and culture, also play a critical role in shaping our perspectives. When everyone can contribute equally, the economy can reward the best ideas, regardless of where they come from.

Your business offers space so people can come together to connect with this type of thinking.

Yes. We collaborate with multinational corporations, governments interested in market development, and foundations to promote resilient economies. Foundations, especially large philanthropic organisations, have historically focused on addressing the problems caused by markets. Still, now they are increasingly focused on developing markets in a way that minimises these problems.

We support approximately 1000+ entrepreneurs annually at various stages of development, including idea generation, prototype creation, market-entry, and growth. Additionally, we work with big companies and government agencies to help them use their power effectively for a more sustainable and equitable economy. Unhealthy economies are not sustainable in the long term, and oppressing segments of society eventually leads to pushback.

Can you share more about your roots, your background, and how you came to do what you do today?

I am part of the Bahá'í community, which has a long history of persecution in Iran. During the Islamic Revolution, the Bahá'ís faced severe oppression, including killing and being banned from university and owning businesses. As a result, my family and I fled as refugees to Ecuador.

Growing up as a refugee child can be a blessing, as everything can feel like an adventure as long as the immediate environment is safe. However, the stories of persecution and danger can lead to unhealthy family dynamics. As a child of an American mother and an Iranian father growing up in the Latin culture of Ecuador, I became a tricultural individual. Later on, when I was a teenager, we emigrated to the United States.

Coming from the Bahá'í Faith, I was taught that all cultures and people are equal and have the right to express themselves. However, growing up as a refugee, I struggled with the paradox of being taught equality and exposed to stories of oppression and persecution. This experience led me to realise that inequality and oppression exist worldwide, affecting communities such as Indigenous, Black communities, and women, including in my own country of origin, Iran.

A consequence of this is that my thinking was driven by the realization that we design our social systems based on the rules we set for them. If a system is designed to benefit only a small group at the expense of the majority, it is not necessarily broken, but the design needs to be re-examined.

I figured out from my economic studies that a system where everyone's ideas are valued and treated equally would lead to a stronger and more vibrant economy.  Diversity makes us stronger, better, and smarter.

Similarly, in the natural world, climate change is a threat to biodiversity, and this loss of diversity makes us less resilient and ultimately weaker. The same is true in human systems and society. A lack of diversity leads to major blind spots and missed opportunities. Suppose a company like Facebook had a more diverse executive team and board. Maybe they would have recognized the risks of their surveillance practices instead of just focusing on how much money they could bring in. Recognizing the value of diversity leads to healthier economies and more innovative ideas. By embracing diversity, we can build a better world.

It's a beautiful idea— and one we’re happy to be seeing much more of these days. At what point did you have the idea for SecondMuse?

When I was doing postdoctoral studies in economic modelling, I spent a lot of time thinking about economics at a theoretical, hypothetical level. Every time my colleagues and I would have a conversation with someone who seemed to have real power, like high-level executives or politicians, we would see that the person with power was not causing change to occur in line with the models and theories which we believed would be most helpful.

I wanted to bring about positive change myself, but the avenue for doing this seemed to require learning to be an entrepreneur. I started several businesses, gaining a lot of experience, and eventually, I combined the theoretical knowledge I had of economics with practical business experience.

When I got to this point, I felt it was time to follow my passion: building economies that could create a positive impact. I got together with a good friend, Chad Badiyan, now our CFO, and together we co-founded SecondMuse.

When did you see how the social aspect and climate were so closely connected?

One of our first programs was called Launch. It was a partnership between NASA, Nike, USA, IBM, and the US State Department, and it focused on accelerating the development of sustainable technologies. It was a pretty exciting place for us to start building partnerships. The attractive thing about entrepreneurship is that it can solve seemingly impossible problems with new ideas, and we wanted to explore that. We believed that to understand and solve significant issues, we needed to understand how people collaborated.

We recognized the need for gender equity among the entrepreneurs we selected very early on. Over time, we realised that when a market is open to change, it's either driven by an exciting new technology, a “disruption,” or some negative reason, like the recognition that a fuel source is harmful to the world. When an economy is ready for change, it reaches a sort of flashpoint moment of intense creativity, and entrepreneurs of all stripes can suddenly appear ready to take on whatever challenges present themselves.

We did some work with the City of New York in manufacturing and advanced manufacturing around 2016. Though the context of the project may have given us the chance to label ourselves as a business accelerator for young Latinos or Black women, instead, we only called this program the “future of manufacturing.” We believe that the future of the industry and the economy should be diverse.

Within a few years, we went from having only a few entrepreneurs, all white and male and from wealthy backgrounds, to accelerating 80 businesses to market— with over half of those entrepreneurs being women or underrepresented minorities. It was a significant shift in a short period of just four years. A blink of an eye to the economy.

We realised addressing a problem as serious as climate change would require as many brilliant minds as possible— and as many different perspectives as possible. Climate change is complex, and its effects are unknown; diversity of thought, or being able to approach the problem from many different frames of experience, will increase our species’ chances of success against it.

What is most fulfilling to you in your work?

I recently spoke with a Brazilian entrepreneur who built a company called GamerSafer that protects players of online video games from sexism, misogyny, and abuse. With 15 million users, it's an incredible feat. She brings her family, culture, and perspective as a woman in the workplace into her business and doesn’t have to pretend to be someone she isn’t to be taken seriously. Seeing her struggles, but knowing her vision, gives you hope that more people like her will succeed.

In March of 2023, we completed a three-year program to eliminate plastic waste in the oceans of Southeast Asia. A crucial part of our thesis was to prevent plastic waste on land before it reaches the ocean. The people who do much of the work on this are in the informal sector, like waste pickers in Indonesia. To our surprise, we found that some waste pickers wore our logo on their shirts because they felt like we represented them. That really meant an enormous amount to us.

​​In India, we supported two waste pickers to start a women-led waste collection service, which is now thriving. This involved breaking down several gender-related barriers. The women became the first in their community to learn how to drive commercial vehicles, and one had to divorce her estranged husband so that she could open a bank account and start a business in her own name.

As you can imagine, it’s very fulfilling to me that my work enables such positive developments. Seeing initiatives like this gives us hope that even if other institutions crumble, something better will take their place and be infinitely better.

It’s wonderful that you help people at the start of their journey, and that you're the cause of many people succeeding and thriving.

Yes, it is truly inspiring. But, of course, the real drivers of change are the individuals and communities who take the initiative to succeed and make a positive impact. We support them along the way, and it is fulfilling to be able to help someone who is doing something incredible. There are also people in the government, big companies, even those with bad reputations trying to make a positive impact and change their institutions from within.

Relationships play a crucial role in bringing about change. By building relationships in different ways, we can see that change is possible, even though it may not be easy.

Is your task difficult due to your efforts to transform organisations from within by impacting individuals within a corporation?

It is. To effectively advocate for gender equity and equality, we must be willing to challenge and deconstruct our own biases and understanding of gender roles. The beliefs and attitudes we internalise growing up can often be limiting and harmful.

For example, I grew up with a Middle Eastern father who taught me emotion and love were bad. If we are unwilling to do the necessary internal work to challenge these beliefs and attitudes, our actions will be limited— we won’t be able to do as much as we want to do.

Did you ever deviate from your life or career path and make a significant change that was unexpected or unplanned?

I graduated from medical school and became a doctor, but I never practised. That was a big shift for me, as I realised early on in medical school that it wasn't for me. I had opportunities to continue building businesses I started before, but I knew that paths like real estate development wouldn't fulfil me the way my current work does. Then, seven years ago, I underwent a major life change due to illness, forcing me to drastically alter my lifestyle. As an entrepreneur, the path is often a zigzag, as it's important to be adaptable when working solo or with a small team.

What gave you the confidence to start SecondMuse, or even your first business?

My lack of knowledge has given me an abundance of confidence. Of course, a lot of people don’t feel that way, but I've come to accept that you may not know enough when starting something, and that’s okay. Despite running a successful company with over 100 employees and 14 offices worldwide and being an expert in many areas, I still need more knowledge. But I’ve gotten this far.

Medical school taught me the importance of confidence in acquiring knowledge. I had a professor who challenged me to learn about fevers and pushed me to the limits of human knowledge on the topic. This experience taught me that learning anything is possible if I am confident in acquiring the knowledge when needed. I don't have to know everything beforehand; I just have to be confident in my ability to learn it when it comes.

With SecondMuse now, what do you think were your most educational mistakes?

There were so many mistakes. One of the biggest ones was that increasing the complexity of the organisation is incredibly expensive and time-consuming. We underestimated this on multiple occasions. Going from one employee to two is a huge leap, as you are not just adding an employee but doubling your staff. Going from one office to two is four times harder, and entering a new country is ten times harder. As an early entrepreneur, you are very opportunistic and chase your ideas as much as the market influences you. Adapting rapidly is key, but we should have considered this aspect more.

At some point, you must double down on what you know. This is one of the biggest lessons learned. You must stick to your core and align your business model with your value proposition. In the early days of SecondMuse, we were making a lot of short-term consulting contracts, but our approach was building community, which takes years, not months. It took us years to realise this misalignment and transition from short-term to multi-year contracts. It resulted in some of the most rapid growth we've seen. Entrepreneurship is a survival game in the early days, but transitioning from survival to thriving requires deep thinking.

With SecondMuse, what were your big “Aha!” moments?

One of the biggest “Aha!” moments was learning how to collaborate and realising that building economies in partnership with communities will cause that economy to be more diverse and ultimately more resilient. If you shun diversity, it doesn’t go away— it just won’t have a voice, and you end up with a problem you’ve created for both yourself and your society.

By partnering with communities, diversity becomes a part of the system naturally. This was a big realisation for us.

Another great realisation was that trust could allow change to happen much faster than just generationally.

If you and I agree to get to know each other, we can learn how we each treat partners, handle conflict, and so on. This can build trust, though it may take a lifetime. Or, instead, we could start from a position of trust, assuming each other's intentions are good and allowing us to progress much faster.

One of the reasons I've never been concerned about internal politics within organisations is that I have always focused on doing my work rather than watching my back. This seems to have allowed us to grow faster than many of our peers. It is unusual to think that a company's growth can be attributed to trust and relationships, but it is a factor.

That is interesting, because most people believe all entrepreneurs are in it for themselves and will take advantage of people. Is it challenging to get people to change their thinking on this aspect?

Some entrepreneurs can be very guarded due to past experiences, for sure. But people who hurt you in the past should not dictate the course of your business for its entire life. Frankly, more people want you to succeed than fail, and it’s good to remember that. Defensiveness will stop you from learning and exploring life’s possibilities. It limits your creativity.

We also have to remember that there’s no such thing as an original idea. All of our ideas come from what we have learned or heard from someone else. We all stand on somebody else’s shoulders, don’t we?

The idea that you have a unique idea that you don't want to share with anyone is unrealistic, especially in a world where ideas can be copied easily. Your value should not solely be based on some ostensibly genius idea because we all need help bringing our ideas to market. After 20 years as an entrepreneur, even I still need help.

So many entrepreneurs feel they must make sacrifices or compromises to be successful. Which ones would you say were the top compromises you had to make?

I have a unique perspective that defines me in all my spaces, but in the business world, there's an expectation to present a more “buttoned up” image, often associated with white men. It can be very alien for a person like me. In my case, my upbringing in Latin America and my strong Middle Eastern culture required me to sacrifice some of my identity to adhere to this conservative business appearance, and I regard it as one of the “bad” compromises I’ve had to make. But I’ve had to make good compromises, too.

On the good side, I've learned to be more patient and considerate when leading a team. You can change course relatively quickly when you're solo, but being in a larger team means you have to slow down and be mindful of how changes affect everyone. Even if you believe your decision is correct, it's sometimes better to go in the wrong direction as a team until it becomes clear that a change is necessary.

It's important to weigh the harm that could come from rapid shifts in strategy or direction. I've had to give up some of my opinions and ideas for the organisation's benefit, but this has helped us grow stronger as a team.

When a lot of change is happening, how do you see the future and the future you're trying to help create?

We certainly live in a time of unprecedented change. Culturally, we’re challenging everything— beliefs about gender, how we define human rights, and the relationship between citizens and governments. It’s all being called into question. And while this is happening, we see and feel the effects that “market decisions” have on humanity, particularly in the form of climate change. The individuals most affected by these changes are often the most marginalised and impoverished populations worldwide. The recent typhoon in South Korea and the floods in Pakistan highlighted the drastic differences in damage caused in a wealthy country compared to a poorer one.

Times of change can be scary and unsettling. A common result is the election of leaders that seem objectively crazy. People fear the future because they know it can't be the same as the past. But change is inevitable, isn’t it? And the people willing to learn will inherit the future.

There’s a great quote by Eric Hoffer:

“In times of change, learners inherit the earth, while the learned find themselves beautifully equipped to deal with a world that no longer exists.”

So with that said, here’s what I think: I would like all of us, as a species, to be able to come together as a community to learn and grow— because nobody has all the answers. We will inevitably make mistakes if we try to plan for the future, and some of them may be worse than what we’re currently dealing with. We need to remain open to learning and adapting to the changing world.

My goal is to build communities around the world that are committed to collaboration and prioritise the well-being of everyone in their community. Continuous learning and growth should allow these communities to adapt and evolve their markets, and when mistakes occur, they should be viewed as opportunities for growth and relationship-strengthening rather than relationship-damaging.

A lot of the institutions we rely upon are outdated and will crumble in the next few decades if we don’t make changes: our governments, various corporations, educational systems, and systems of buying and selling. The pandemic highlighted the need for new approaches to education, but other areas (like the economy and the environment) also need attention.

The cost of not adapting to a changing world is becoming increasingly apparent. We need to embrace change and find new, sustainable solutions for the future rather than just trying to prop up the systems of the old world.

We must think about how we can tap into the expertise of our people and update our civilisation. Our current laws and regulations were written when society believed that men were superior to women and that certain races were superior to others. This type of thinking was considered truth at the time, and unfortunately, it has woven its way into the fabric of our institutions.

I say good riddance to partisan political systems and state-controlled shareholder economics where the only goal is to make money. Good riddance to governments where politicians are swayed by money from lobbyists and large funders. Good riddance to educational systems that do not provide personalised education.

This is a moment for us to find a new way of doing things. But it cannot come from individuals; it must come from communities. We cannot repeat the mistakes of the past— where oppressors become oppressed. We must end the rule of one segment of humanity over the rest. We need to build systems that work for everyone— including Indigenous women, for example— and others who were not part of the initial rules and conventions that dominate the global system.

If you had one piece of advice you would share with up-and-coming entrepreneurs, what would that be?

Be humble: but trust, nonetheless, that you might have something special that the world hasn't seen yet. The world is much more prone to saying no than to saying yes. If you are strong, be humble. Sometimes, we're all wrong, but sometimes we're also right. If you have something different, it might be what the world needs.

What would your lasting message be if you could reach everyone on this planet?

Build a relationship with somebody fundamentally different from you.

Thank you so much for taking the time to share some of your story with us. Your work is genuinely inspiring, and we hope that SecondMuse will continue to effect positive change in our world for many decades to come.

If you would like to learn more about SecondMuse, please visit www.secondmuse.com.

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