Podcast Episode 12: From Burnout to Unstoppable Entrepreneurship: Lessons in Leadership and forging your own path with Robert Lenzhofer

Leo Judins: [00:01:00] Robert, welcome to the iGaming Leader. Super excited to have you here. We were talking in Lisbon and I've been so looking forward to talking to you on this show because there's a few things that you said that really resonated with me. And I'd love to share that with the audience. So first of all, welcome to the, welcome to the podcast.

Robert Lenzhofer: Thank you for having me.

Leo Judins: Robert, you've been in, you've been in gaming for 20 years, starting at B win 2001, I think. Right? before that, some snooker, I believe. but what drew you in the, into the industry initially, and, and, and also what kind of kept you excited? To stay in there what hooked you to stay inside of it

Robert Lenzhofer: I was interested in computers when I was six, basically, and computers when you're a child and six year old or 10 year old or 14 year old , is a lot about games. but I also got interested in fixing computers and playing with them.

[00:02:00] And then you discover programming languages, simple ones in the beginning, obviously with a C64. And then it gets more interesting with a PC. And I started developing certain, you know, useless or useful applications. And also some really simple games as well. And so it was always on.

computers and when I finished school in 96 there was just a year when the internet was basically well in life I think especially with the HTTPS protocol being released in 95 or so 96. That's also when the first online casinos came out. But I didn't know much about them back then. I was basically a software developer back then and applied for jobs in Vienna so I lived most of my life in Vienna now.

I live in Germany and It was around 99, 2000 when I was working for a company called,, Active agent in Vienna, which was bought by Gold pedia. I think Gold pedia still exists, and it had the same investors as Betandwin in Vienna.

[00:03:00] And we got, as a team, five of us, we got headhunted, to join Betandwin in Vienna. And Betandwin was quite interesting because it was basically the only one which properly survived.com bubble, in Vienna. All of them, all of the rest basically. I think nobody really survived in any meaningful way, let's say.

And, so it was kind of the tech story now, the sale or the merger with GBC was the biggest technology exit in Austria, by far over a billion and for a long while, I think only recently this was speed. So it was quite the success story. And I was in tech when I joined. Betandwin, it was called back then in 2006, rebranded to BeWin.

I was in essence a technical product manager, so I didn't code anymore. I was just a product manager, technical product manager. And back then I didn't feel I'm part of the industry. I was sitting , with my team, with some developers. I didn't know anything about sports betting, like marketing or branding, or affiliates or anything that didn't, although I worked inside an online gambling company, I was quite removed from the industry, per se. 

[00:04:00]So I quite liked the technology part and the development of. technical solutions for the iGaming industries, so to say. And to really cut the story short, because that's sort of the arch for today, where I am today, is that still what I do today. Just the capacity changes, the product changes, and now, you know, it's a B2B company I run, which does technical products for the iGaming industry in essence.

Leo Judins: So when you kind of realized that you were in gaming, right? What uh, what excited you about it? What was the thing that made you stay?

Robert Lenzhofer: some really obvious things, meaning I understand it. , once in a while you look outside and, say, should I change industries? And obviously many people have this as well in the industry, this question, am I contributing positively to this world basically?

 And something really important and as most people who are educated in the industry notice is that when you look at all the various sorts of the UK prevailing study and so on, there isn't really a direct correlation between, more marketing and more addiction, let's say.

[00:05:00] So, that was really important for me to understand that really feel, and it was not just the UK prevailing study, but many others also, we did a study with Harvard Medical. Division of addiction. The head of the research team was in Vienna. It's common knowledge that there is a certain addiction rate, but it's relatively stable and relatively, independent.

There's short term bumps, but relatively independent of that. So at least I knew I'm not causing additional harm by having better products, so that caused me to, to stay and say, well, if that's true, and that's what I believe is true, then it's like an entertainment industry.

 And entertainment is a really important part of life. And it's a really important component. And when you group two sorts of industries together, the things you don't need, the things you need, the things you need are food, the things you don't need is a lot, yeah? It's video games, it's movies, it's, online gambling, it's, certain sports you don't need, yeah?

 So it's a huge, huge sector, and the service sector and going out, generally speaking, you don't need to go out in a restaurant, you can cook at home. So if you include all of that, things you don't need and things you need, it's a huge, huge sector.

[00:06:00] That the things you don't need are actually the larger portion in life. That is what actually makes life creative and worth living. So that's soul searching over, over two decades, of course, every once in a while,

and obviously when you stay for a few years, you develop friendships and feel quite warm and homely. It feels like it's more than an industry for me.

 Friendships have been developed and also. I think it's technically interesting because the iGaming industry technique is always a little bit behind.

It's never full on cutting edge. Yeah. Like the latest tech, is closing in, but because there're certain, dominant players who basically play the cash game, like big operators raising lots of money. And then obviously you solve everything with money.

So you never take care of technology properly. Means there's a gap of a good technology leader and, you know, creating lean and mean and cutting edge technology solutions, um, , for the market. And it's arguably a little bit easier, , to do that in this market, then let's say moving to Silicon Valley and trying to compete with the top guys there.

[00:07:00] And you can have a meaningful impact. So there's, there's lots of room to build things because there's lots of gaps and you don't need to be, the first one ever to use a technology you can, explore deep dive and really, really get to know, technology part while the, bigger operators and bigger sort of tankers, let's say, maneuver slower. And, um, yeah, that's, that's why I think it's, it's, it's, it's fun and it's impactful technology wise. 

Leo Judins: Yeah. I love that metaphor that you were starting there. Tanker versus Speedboat, right? I want to take you back to when you were at Better Win or BWin. Take me back through those early days and like how you progressed through your career and some of the biggest challenges were, as you were, Progressing through roles and, and, you know, kind of moving with the speed of speed of sports betting, I suppose,

Robert Lenzhofer: In honesty, I didn't really progress much. So that was also an interesting learning. When I started the world was around 30, 50 people. So when I left. If you include GBC, there were 6, 000 people or so, or 5, 000 people. And I didn't really progress well.

[00:08:00] I was sort of moved slightly sideways, slightly up, but the projects were interesting. And I think I just didn't do well in large organizations. Large, I mean, like really large and really pyramid organizations. There was an incentive, a lot, and I guess that's true in many of these organizations.

There's an incentive to be a head of or a leader, because then you earn more and then you get more responsibility and then you lead more people. And if, if this is not managed well in organization, then it becomes a self fulfilling prophecy. There were key people, who had a lot of power and they couldn't, not abused, but heavily used the power to just hire more people. And the more people they had, the harder they became to replace basically. And I never played this game. I was focused on building the you know, fulfilling the next project. So it was never my career path and that was important learning because when I came out of, bet and win, I said, well, I need a small company.

[00:09:00] I need to be impactful. That doesn't mean a big company can't act like a good startup. There's good management philosophies that reinforce that. And sort of make it happen that, you're not drawn by the typical pitfalls of a tanker, but I wanted small and from when I left from there, I did some consulting.

I tried to create my own company in 2000. 10, 11, couldn't raise investment, but worked with a small startup in Berlin. And that was a lot of fun. And it was quite impactful because your work had an immediate impact, and got live really quickly. And that's a lot of fun. And the same as this company.

Now we started with six people, really with 12 now. And it's highly impactful because everyone can contribute heavily. The learnings, I have taken, I can take positively, into the future, from bet and win, especially back then to make sure when we, we grow further, maybe, that, I hopefully have the right answers to not have a similar challenge, or create an environment for people to grow easily, who are not necessarily.

[00:10:00] The ones who want to lead large teams, but still want to be impactful. 

Leo Judins: I'd, I'd actually like to dive into that because that's such an important, powerful and, and really, uh, honest observation of yourself, right? Because I think many people feel that that is the only path, right? The only path is to actually move up, get more responsibility, and then they find themselves there.

Not really sure how to lead teams. They start to build a little bit of an empire. Then there'd be perhaps a bit of a micromanager team disengaged, and you have a really toxic organization or a really toxic department. And it's actually very powerful that you've seen that very early on.

That's just a, not your kind of thing to do. You don't like that. Wasn't your path. And B even more importantly. You've decided to take a different path and go into entrepreneurship very early. So, what's the moment when you realize that the normal path that most people think they have to go on wasn't your path.

Robert Lenzhofer: [00:11:00] Certainly when I ended up in hospital, last year when I was at Betandwin, I had a major stomach ache and went to the hospital and they said nothing was wrong. And they asked me, do I have stress? I'm like, I'm not working a lot. And the guy said, do you have stress?

And I said, I'm not working a lot. But, I didn't understand the question back then, because. Certainly I had burnout, and this is also when I learned burnout is not, because you work a lot, but because there's too many things in your life that are out of your control. And that certainly happens in these organizations.

And so that's when I realized, phew, I had to get back into control and do things where I can control things. So that's where I certainly learned it. 

Leo Judins: Tell me a little bit more about that, Robert, if you don't mind about burnout, because it's something that. Like I've, I've had two burnouts as well. And I think, it's kind of easier to recognize once you've had it because you kind of see the symptoms coming, right?

It often comes from things like you said, it's not necessarily the hours, but perhaps the weight of those hours. Right? So if, if you don't have value really in your work anymore, or, uh, you have too many things, like you said, out of your control, But how did that happen for you? Was it like a moment all of a sudden that happened? 

Robert Lenzhofer: [00:12:00] Obviously it's gradually over time, but it was a moment and then major stomach ache, I couldn't eat properly. We literally could only eat bananas and like, they're called Zoletti in Austria. For two weeks, that's the only thing I could eat, like it was crazy. And, I went to the doctor again for a checkup and he said, there's still nothing. It's all fine. It's probably stress or burnout and your system is reacting. And it was basically, it's, it's really interesting. You can recognize it easily.

Yeah. Very easily, if you have done it before, if you had it before, but as I heard that statement later on, a few years later that it's about the things you can't control and the way you're down basically. So it's not the hours, a little bit, I'm burning out.

I work so much. No, no, no. Like working 12 hours is fine. If it flows or working six hours is fine, but you can have burnout if you work two hours per day, basically, 

Leo Judins: If you don't work at all

even, right? That's

Robert Lenzhofer: Yeah, and, um, a friend of mine once said this, you can be quite lazy, although we work many hours.

[00:13:00] And I found that really profound because there's a lot of people who work a lot of hours. But then you look at the output and what I realized as well in this last year at Badmin, my output was productively zero. I worked a lot, but productively I didn't ship a product that had to do obviously with the structure of the projects that had to do also with organizational changes where there were layers of layers of layers of non-control basically.

Yeah. There's a merchant looming. There was the, there's this other product integration was there and you're like, okay, what do I do? Yeah. I mean, there's no harm in trying to be good, and trying to be nice, but, you come first. This is important learning.

 It's this metaphor I really, really like. Emergent situation in a plane? You put. it is on yourself first, the oxygen, and then you help other people. But burnout is typically when you don't help yourself first. You still try to help other people and everything is out of your control.

And whether you work 12 hours or two hours, it doesn't matter. You feel the same. And that's sort of a good indicator for somebody to realize. Work less hours if you still feel the same. That, at least one point on the checklist, that you're close there. 

Leo Judins: [00:14:00] Love it. very much for sharing that. It also kind of ties into this idea of an oil tanker, right? And that sometimes we work many hours, like you said, but our productivity is close to zero because productivity equals the actual output that you have, right? The

results that you achieve. Thank you. And sometimes those results have just, or the output has slowed down because of the organizational complexities. And I suppose because there's just too many layers or there's too many decision makers. And that must have frustrated you for a long time, right? I'm assuming that's kind of what led you to start up your business in 2010. Tell me a little bit more

Robert Lenzhofer: Well, I think, uh, I summed this up a few times recently for me, that's my personal path. I mean, everyone has their own sort of feelings about, and your data points are low, you know, you have two data points in life and they, they guide you.

Yeah. don't take too much advice from people because you have your own data points. Today I feel it less, I think. But I always felt I'm a really good number two. I'm just looking for a good number one and I never found one really. 

[00:15:00] Yeah. I found one, maybe for a short period of time at Beatandwin, actually, but sort of because waves free organizations swamped it. But never really found a good number one to work for. And then I'm like, okay, fuck, I have to create my, I have to create my own workplace

So the foundation of this company is not over 50%, but to a certain large percentage. Well, I need to create my own workplace because otherwise I freak out at some point, I mean, you can do that as well if you are, if you know yourself well, if you have good lived experiences, you can do that in organization too.

But Yeah, that's the way, that's the path I've chosen to create my own workplace. And that's sort of part of the reason to found this company. 

Leo Judins: Hey, and, and being here now, Robert, what are some of the kinds of the lessons that you've taken with you from being in more of a corporate environment or working for somebody else? What are some of the lessons that you've taken from that and maybe adjusted or implemented in your business today?

Robert Lenzhofer: [00:16:00] You learn the most when you lose, really. When you're winning, you hardly learn. So I couldn't say I'm taking a lot of wins or positives from 

there. But equally, the losses are interesting, because you realize how,

like, without bad intent, 

it sort of went to a path I think many people didn't want to go. I mean, if you look at the Bwin Vien office now, I I think 99% of people left, 

so it also shows that many people weren't happy and many people left like after GBC and left. So, so the learning is really to be careful, that it doesn't happen and, and how, I don't think I have the answers really. I don't want to, at least I don't want to claim I have them. I have some ideas.

 So there's this, these eight, nine, 10 years I've been at Bwin in the last 10 years where I've been mostly with smaller companies and smaller companies also means you educate yourself a little bit. You're more outside, you're more talking to people. 

I moved to Berlin when the whole startup scene happened in Berlin, to try to raise some capital as you learn about term sheets, you learn about investments, you learn about all of these things. 

[00:17:00] And also you get in touch through either social media or directly through certain leaders in this sort of Silicon Valley or like tech industry as well.

How teams are managed, and then you read certain books and over the years you sort of create almost a new picture. And I mean, there's a few buzzwords out there, which I think still hold true, like this old buzzword from Jeff Bezos, these pizza teams, yeah? Quite important, that you make sure teams are never larger than, that you can still feed one team with a pizza, let's say that was the term, yeah?

And that resonates with me, and we talk about this internally now that we have, you know, growing, not crazy, but we're growing. And so there's a path that we will eventually have more people and sort of the way we want to solve this , as to not have this pyramid as well, that we built a functional island strategy we have two products now, maybe at some point it will be completely separated, APIs, but then they are.

The islands in their own right, let's say, we also thinking of having more studios, internal studios, so they can also be their own islands and when they grow to 10 people, that's fine, you know, but suddenly you can have an organization of 50 people and it won't feel heavy and large and political, basically, I see other operators also having is That you fall into the trap to believe your intuition, how organizations should be run.

[00:18:00] What happened back then a lot was that, you had a CM department, let's say, and the intuition tells you, well, we have one CM department, one voice to the customer. All products go through one CM department. And the consequence and sort of, it's a question of like, you have to choose where you want your shit basically.

Where do you want to be shit? Yeah. , and that, when you make the choice, you're going to be shit in product. You know, you're not going to be precise in product. You're going to be good in the single voice to the customer, but you're going to be shit in product. And this was changed later that, each vertical had their own sort of unit and Island, to communicate.

Correctly to the customer. Maybe it wasn't perfectly the same English or the same German. Yeah, maybe it's the same brand speak, but it was objectively better. And I think that's what a lot of companies still do wrong. 

[00:19:00] So this this is one 

Robert Lenzhofer: So this is for me 99 percent of the books you read are evolutionary.

They are interesting and insightful very few books are like Eye opener who like to explain the world in a really different way to you. And one of those books was read a long time ago ago. I keep reading it every three years. It's called Lean Thinking by James P. Womack and second offer. It's really interesting.

[00:20:00] It's old and it was basically about the Toyota production system. And , this is highly interesting for any tech leader as well, because this is where Kanban comes from. From the japanese toyota production system. This is where kanban boards come from. It's a Japanese term. As the story goes in car manufacturing, the auto production system took over. The leaders in Toyota became consultants and traveled all over the world. One famous example is Porsche, who got really quite successful. It swept basically all automotive manufacturing, because all of them did it slightly by their intuition, it was all about big scale, big volumes.

 Everything has to be highly efficient, each station has to do a highly specialized task and then it's handed over to the next station only to realize it builds up shelf storage, storage space, which needs space, which creates faulty products, which creates delays.

But one example, do you know how long it takes to produce one can of Coke?

[00:21:00] A total of nine to 12 months. If you include the whole, if you include the whole value chain from basically from, getting the raw materials for the can, you know, take making the can, then it's stored for three months, somewhere it's waiting. So a lot of this is also sort of a Japanese term called muda, waste.

So the way to look at, good flow in a company is to look at, your product basically becomes eyes and sees how long it's waiting. And how long it takes that the flow reaches from the beginning to the end, basically. And, the more waste Muda is reduced, the more flow you have in the company.

That's really important because then you have quicker feedback loops. Your products come to market quicker. You have less storage space. , it's also with digital products. When you develop a software and it's ready, but it's tested three months later, almost always you have to go back and change things because you have new information after three months or something has changed in the production environment or an infrastructure.

[00:22:00] To optimize flow, reduce waste, things are not waiting and things can be done, quickly one after another, basically, 

So you need to really, almost fight against intuition and objective. You look at output and flow, 

Leo Judins: Hey, and how do you apply that in your business, Robert? Like, what are some examples of where you've maybe identified a wastage, optimized it? Maybe use some, I don't know, some non typical approaches to increasing efficiency of flow in your business.

Robert Lenzhofer: One of the things which was learned in the Toyota production system, and it's like it applies everywhere is your intuition tells you, well, you have like five tasks to complete.

 A certain element of the software of a car. Well, clearly I have to split it up between five people. Clearly. That's what your intuition tells you because you have specialists, they're the experts and that's what they have to do. But what happens suddenly you build silos, things have to go from one person to the next.

[00:23:00] Yes. Like the one person can do the task quicker. then anybody else, but it has to wait for the next person, it piles up basically as well. Then you have communication issues then the flow is reduced. So one example, for instance, we have deliberately chosen is to rebuild games for the web. 

And the technology in the web predominantly is JavaScript or TypeScript. And games have a frontend and a backend. And you are much better advised to optimize flow if one person is able to do the backend and the frontend. In one person because then not two people have to communicate there is no waiting time There is no scheduling of backend and frontend and that's why technology decisions are sometimes really important. 

We chose node JS typescript in the backend as well. So a game developer has the chance of building a game end to end. I've seen it in the previous company we ran. We had Java on the backend. Then one developer was doing the Java backend. The other one was doing the frontend and it created scheduling. The backend was ready, but the frontend wasn't. And the front-end guy was waiting, but the backend was delayed. The typical things. And this is one, one key example that we have chosen deliberately to optimize for flow.

Leo Judins: [00:24:00] One of the things that I got highly interested in when you mentioned it is asynchronous meetings and, and optimizing, especially optimizing time. You know, in gaming, we obviously work across multiple territories. Often lots of people work from home. They are different, we are on different schedules.

And one of the most inefficient things I see is meetings, right? Meetings are so inefficient because they're often ill prepared. They become coffee chats. They are, they have lack outcomes. They are not really synchronized with what the ideal time is for me that disrupts me from my day to day schedule.

So you've chosen to take an asynchronous approach to meetings, which I think is brilliant. So can you explain this a little bit more about that, how you do that, how it works and why it's so important for you?

Robert Lenzhofer: First of all, it's not that we invented this or that we are novel. We just copied other crazy ones, who are very successful. There's specifically one company out there, called GitLab. And GitHub, they are the two sort of companies, for, Software code repository and deployments and so on. 

[00:25:00] And GitLab was at the time, at least when we looked four years ago , the largest remote only Company and they did something really interesting. They published a handbook. It's basically about how asynchronisation happens and works.

So we simply copied a lot from there. Or let's say we were inspired by a lot of the principles and, we also had ease because we started as a new company and we talked about this and we started like this. It's switching an existing company to fully remote or async, I don't know if it's hard.

 Because it also depends on the personality of people, but what does async mean? Async isn't religion, meaning we don't only do async, but we lean into async. So we try that, that every sort of first step is long form considered text. And what I always say a lot is, tools incentivize certain behaviors. 

[00:26:00] For instance, what is sync? Sync is a call, but also chatting. Because chatting is like a conveyor belt, and if you jump in three minutes too late to the conversation, you're the idiot, basically. And then I'm like, oh, this guy we already discussed this, scroll up, basically.

But it's also synchronous. You have to be there at the same time. And simple, small things incentivize behavior. If you have Slack, for instance, where you have a small box and, you know, people say, hi, how are you? Enter. What's going on? I have this question. Enter. And it's that behavior is highly incentivized with these notifications and.

The small box, but, we use a different tool where simply it's focused less around chat, more around messages and async messages, which means it's just a large input box. It's a simple UX UI change, but that also tells you. What to do. You should write more because you have more space.

It's a subtle thing, but that's what it does to you and your brain. And also notifications are light. They are turned off for messages that turn on if you're chatting, and so you're not immediately messaged with all these messages basically, Just one example, we have this feature called Gamble Games in slots.

[00:27:00] It's like when you win, you can, 50-50 gamble or ladder gamble and so on. It's a long, long thread, but with long considered messages and screenshots. And what's really beautiful about this thread is we started it three years ago and it's still ongoing. And so you start a conversation, you put the screenshots on there.

Because it's not a chat, people don't instantly answer like 24 hours later, the first person answers because the person slept over it and thought about it and check some screenshot, post an answer, then this goes on for like a week. So that is slower than sync, but it's typically faster at the end of the month.

Because. You're not constantly in meetings, you don't have to wait for the next meeting, you can think about it and participate in this thread. And also what happened as well with this particular project, we sort of didn't pursue it for a while for three months, and then we picked it up again. It takes you 12 minutes, 14 minutes to read the thread, you are up to date on two things.

[00:28:00] And that's really vital compared to most sync organizations. You're not only up to date on the outcome, but also how you arrive there. How many meetings exist in an organization. Jump simply to realize why we do what we did? The organization should be like a brain and the communication should be an automatic documentation that the brain learns and keeps information, not loses it basically after a few months.

And that's so powerful because we can come back and like, Oh, how did we do this? Then people read through the chat and be like, ah, okay. That's why we did it. Oh, fine. We can close the meeting. 

Leo Judins: Makes a lot of sense. I think the other unseen benefits of it that we haven't discussed here yet, but I think it's so powerful is that with these instant communication tools. Even with email that often people use as an instant communication tool because they're constantly checking it, instantly replying. It disrupts you from your flow, right? 

You might be working on something and you get interrupted by these notifications. You're distracted. You go into that thing. It takes you time to go back to the thing that was important to you before. And that is all prevented by asynchronous work.

It makes an organization highly efficient.

Robert Lenzhofer: [00:29:00] If you're an organization and you have meeting-free Thursdays or something, it's a band aid, you have a problem, you haven't solved it. Not helping. It's weird when you have meetings all day and suddenly you have no meetings. It's also you can't you it's hard to get into the zone of like, oh i'm gonna do productive thursday Because that's really what it is.

It's not a meeting-free Thursday. It's productive Thursday. Um, so it's hard. Yeah, um it's a bandaid. It's not working.

Leo Judins: I want to ask one last question, which is, from your 20 years in gaming, what's, what's one piece of advice that you would give someone that perhaps is kind of moving through their career, struggling with some of, juggling all these balls and, and feeling the pressure and you know, how can they best navigate their career and make progress in a way that is sustainable?

Robert Lenzhofer: [00:30:00] I think first of all, an anti sort of advice. Don't listen to advice too much because there's too much advice out there and 95 percent is not for you. You have to find your own path. Don't listen to me. Um, uh, but so, but basically try to find a correct view of the world.

There's industry media, There's regular media, there's like your network inside the company, try to get more and try to find your own path and find your own correct view of the world because a lot of shit out there is confusing as fuck. Um, so you, you just don't listen to me.

Don't listen to anyone really, because, oftentimes it's just, it's just too tempting to, um, reinforce your own bias you already have. Yeah, we know the social media site is how it works. So, maybe some light piece of advice, try to get a broad range of advice from vastly different people in vastly different audiences.

Should be social media, should be conferences, but don't listen to one person or two people only, I think.

Leo Judins: Thank you very much, Robert. Love talking to you and thank you very much for joining.

Robert Lenzhofer: Thank you. Thank you for the time.