Executive Book Club

The classic business book Gwyneth Paltrow read as a teenager that inspired her to start GOOP

GOOP founder and CEO Gwyneth Paltrow at The New York Times Dealbook event on November 6, 2019.
Credit: Mike Cohen/ The New York Times

In 1989, the same year a 17-year-old Gwyneth Paltrow made her acting debut in the TV movie "High," she also read one of her first business books: "Barbarians at the Gate: The Fall of RJR Nabisco."

The book — which was written by investigative journalists Bryan Burrough and John Helyar after they covered the fall of the American conglomerate that sold tobacco and food products in the late '80s and early ' 90s — got Paltrow thinking about starting a company.

"I remember reading 'Barbarians at the Gate' when it came out and just being like, 'This is incredible. This is like gaming, but with real people in real life,'" Paltrow told Reid Hoffman on the Masters of Scale podcast.

The book details former RJR Nabisco CEO F. Ross Johnson's attempt to take the company private in 1988 in order to buy it himself. It set off a tumultuous bidding war as other companies fought to make their own offers. In the end, investment firm Kohlberg Kravis Roberts & Co. bought it for $25 billion. (At that time it was the largest corporate takeover in history.)

Despite Johnson's failed attempt to buy the company, he walked away with a "golden parachute" payment of about $50 million, according to The Wall Street Journal. His unethical tactics throughout the process made him a symbol of corporate greed and corruption in the late '80s.

Burrough and Helyar detailed Johnson's free-spending as CEO: He used corporate funds to decorate his office with lavish items such as a $51,000 vase, a $36,000 end table and a $100,000 rug. He was also accused of jet-setting around the world using more than 10 corporate airplanes, which some dubbed the "RJR" Air Force, among other things.

Paltrow said the drama in the book, which was made into a made-for-TV movie by HBO in 1993, got her fascinated with the world of business.

"So I always harbored this secret desire to somehow start a business," Paltrow told Hoffman.

Paltrow said at The New York Times DealBook event on Nov. 6 that despite growing up in an artsy household, where her father Bruce Paltrow was a film director and producer and her mother Blythe Danner was a Hollywood actress, she was always "very drawn to business."

"I think it's fascinating and very dramatic in and of itself. So I just always read about it. I always loved it," Paltrow said.

Paltrow said that going to a prestigious, all-girls private school in Manhattan also had an influence.

"When I started to go to school with the daughters of some very prominent businessman, I started to ask a lot of questions," Paltrow said.

In 2008, at the age of 36, Paltrow finally made a move toward starting her a business. She began sending a weekly email newsletter called Goop with lifestyle advice to her family and friends.

Goop has since morphed into a lifestyle brand, which sells its own beauty products, supplements and clothing. Goop also holds health wellness summits throughout the year in places like Los Angeles, New York City and London. Goop's biweekly newsletter reportedly had 8 million subscribers in 2018 and is valued at $250 million.

Paltrow, 46, is now the company's CEO, but in the beginning, she hired someone else to run the company.

"I just didn't know what the f--- I was doing," Paltrow said at Dealbook, "So I thought I needed to outsource everything and I thought I needed a grown-up around me to, you know, tell me what to do."

Paltrow soon realized though, that nobody actually knows what they are doing when launching a new product or service. And that realization has been the most interesting part of the whole process, she said.

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