[Outliers] The Hyundai Founder Who Put a Country on His Back

0:00On June 16th, 1998, an 82-year-old man climbed into the lead vehicle of a convoy of 50 trucks loaded with cattle. Behind him were 500 cows raised on a farm he'd reclaimed from the Yellow Sea. As the cows passed, Buddhist monks chanted, and women in traditional hanbok dresses lined the road, waving as the convoy rolled through the last village before the razor wire barrier separating North and South Korea. The man in the lead vehicle was Chung Ju Young, the founder of Hyundai.

0:33He was the first South Korean civilian to cross the border since the country was split in half. Four months later, he came back with 501 cows, 1,001 cows total, one for the cow that he had stolen from his father 65 years earlier, and 1,000 for interest. Chung was so determined to change his situation that as a teenager, he stole a cow so he could sell it to buy a train ticket out of the farming village where he was born in what is now North Korea.

1:04He left in the middle of the night, told no one, not even his father, and arrived in Seoul with only a sixth grade education and no connections. In order to survive, he swept floors, hauled freight on the docks, ran a rice shop, and even fixed cars. Of course, this was all before he built Hyundai, but you can start to see the type of person he was. While many people think of Hyundai as a car company, at its peak, it accounted for 16% of South Korea's entire economic output.

1:36It built the highways that connected the country, the ships that carried its goods, and the cars that so famously announced Korea's arrival to the world. Ju Young wasn't an inventor or a theorist. What he was, more than anything, was a force. He was a person who could not be stopped. Welcome to Outliers. I'm your host, Shane Pariff. Today, we're going to explore the incredible life of Chung Ju Young, and it's one of the craziest stories I have ever heard in my life. This is the story of a man who refused to be stopped, no matter the circumstances, no matter

2:10the obstacles, he simply would not quit. He was so poor at one point, he's eating tree bark, and so rich near the end of his life that he's in the top 10 in the world. And in between these, he created entire industries and put an entire country on his back. One quick note before we get started. This is a longer episode, and I kind of like this format. It lets me go below the surface, beyond the soundbites, into the mindset and details that really matter. Let's dive in. In the village where Chung Ju Young was born, the children ran home from school during the

2:44day to go to the bathroom because their family needed the feces. Human waste was the primary fertilizer for the dry fields, and in a bad year, a few extra contributions from a small child could mean the difference between eating through the winter and not. Chung was born in 1915 in a small northeast corner of what is now known as North Korea. At the time, it was just Korea, and Korea did not belong to the Koreans. Five years earlier, Japan had taken the whole Korean peninsula, and what they did to the

3:15farmers was brutal. Japan seized the land through a paperwork trick. Korean farmers held their land by custom, not by deed, so when the colonial government demanded written proof of ownership, most of them had none. Overnight, everything changed. Suddenly, they were landless. By the time Chung was a teenager, Japanese settlers owned more than half the farmland in Korea. Korean families now worked as tenants on the same land they had once owned. Rent took more than half of the harvest. Taxes took around a quarter.

3:46A family kept maybe a quarter of what they grew, and that wasn't enough to survive on. Japan shipped the best crops home, rice especially, to feed its own population. Koreans ended up eating sourgum, a coarse grain they had previously used to feed their cattle. Historians later measured Korean heights from the 1920s to the 1950s. The average Korean kept getting shorter, year after year, a little smaller than before. Chung's father farmed about three and a half acres. That sounds pretty manageable until you realize those fields had to feed a family of ten through

4:20winter using farming techniques that hadn't changed in centuries. In a good year, the harvest lasted through long winter and into spring. In a bad year, the food ran out halfway. And there were a lot of bad years. Here's how Chung describes it himself. Back in those days, farming families were so poor that words cannot capture their suffering and destruction. After harsh winters, we would completely run out of food by the time spring arrived. From then on, we barely managed to stay alive by eating tree bark and grass roots and wild

4:52herbs. He had to eat tree bark just to survive. That's crazy, but it gets worse. Chung recalled his parents' arguments. I still vividly remember that my parents' arguments were always about food. Their arguments would become more and more heated until the table was overturned and the food ended up on the floor. Under Japanese colonial rule, Chung inherited two things from his parents. Let's start with his father. The man knew one thing, how to work. Chung described him as a man who farmed from birth to death, head to toe.

5:23He didn't say much. Chung wrote, Even when working beside him all day, I heard him speak at most three or four words. His father's total assets, as his son recorded them, were a healthy body and a diligent character. He worked from sunup to sundown every single day with no exceptions and no holidays. As the eldest son, Chung was expected beside him in the fields after school until dark. In Korean life, the eldest son was the pillar. If the pillar fell, the whole house fell. His father understood this in his bones and organized his entire life around it.

5:55By seventh grade, Chung was no longer in school at all. He was farming full time. His father was training him patiently and relentlessly to become exactly what he himself was. From his mother, he got something else. She was ferociously competitive. If the other woman in the village weeded one row, she weeded two. If they wove a certain amount of silk, she would not stop until she had outproduced every one of them. Chung absorbed all of it, the work ethic from his father, the refusal to lose from his mother.

6:25But in Chung, they fused into one. Later in life, he would describe himself as having an addiction to proving limits wrong. He took deep, genuine joy in being able to say, I did, when everyone around him was telling him he can't. But something darker was happening in those fields. Chung was not just learning from his father. He was watching him fail. The hardest working man Chung knew could not feed his family through the winter. The discipline that should have been enough wasn't. And the boy noticed. While working these rows, he thought to himself,

6:57Will I always be a farmer and never straighten my crooked back? A farmer who will never feel full for even a day? A life like this, to suffer, like my toiling father. Is that all there is? It was not all there is. But getting out would cost him more than he knew. Chung ran away from home four times. His father caught him the first three times and dragged him back. The fourth time, Chung slipped out in darkness and never returned. The first time, he was 16. He had just finished elementary school when he read a newspaper article about construction work

7:30in Shaizen, a port city on the far northeast coast of what is now North Korea. It was a four-day boat ride away. He had no money for the boat. So he decided to walk 250 kilometers through the mountains. He made it. He found work on a construction site and labored for two months before his father showed up and ordered him home. But something had shifted in him. For the first time in his life, he had earned his own wage and found his own way. He had felt what it was like to do real physical work and get paid for it. He went home with his father, but he went home a different person than the one who had left.

8:03The second time, he was 17, and the destination was Seoul, the center of everything. He set out with two companions, and on the road, a man promised them employment and stole their money instead. Penniless and stranded, they gave up, and his father found them at his grandfather's house along the route. Getting conned was humiliating, but it was also an education. It would make Chung unusually careful about who he trusted for the rest of his life. The third attempt is the one that became legend. To finance it, Chung stole one of his father's cows, sold it for 70 won, and bought a train

8:38ticket to Seoul. And you need to understand what a cow meant in poor Korean farming household in the 1930s. A cow wasn't just livestock. A cow plowed the fields and hauled goods. A cow represented years of accumulated savings and food. Selling it was the equivalent of mortgaging the farm's future, and Chung did it without telling his father. He reached Seoul, enrolled in a bookkeeping academy, and set out to become an accountant. Things went well for about two months, and then his father found him.

9:09What happened next is one of the most devastating passages in Chung's autobiography. His father crouched down in front of him, in the dirt, and wept. And then he said this. Are there any parents in this world who don't want their children to be successful? If you are successful enough to bring your parents and siblings to Seoul and look after them, why would this old man hold you back? But you better not forget what you are. Just a farm boy who only finished the sixth grade. I hear Seoul is crawling with unemployed graduates of vocational schools. But you?

9:39What are you? A nobody. And a nobody like you isn't going to make it. You will throw our family out into the streets, blindly chasing after this stupid dream. I am old now, so you need to be responsible for looking out for the family. Since you refuse, we're going to have to turn to begging. Sit with that for a second, because the father was not wrong. This was Korea in the 1930s, in the middle of a global depression. Seoul was full of unemployed men, most of them far more educated than Chung.

10:10And here was his eldest son, the designated pillar of the family, a teenager with a sixth grade education who had stolen the family cow to attend a school he could barely afford. Chung's father saw the situation with painful clarity. The son saw farther, but neither of them knew that yet. Chung later wrote, Even today, I get a lump in my throat when I recall my weeping father crouched down as he uttered these words. He went home with his father and threw himself into the farmer, trying to repay his guilt through

10:43effort. He resolved to accept his fate and be the best farmer he could be. He even bought land to expand the family's holdings. He was going to be the pillar his father needed him to be. But then another bad harvest hit. The food ran out again, and his parents started fighting. Chung wrote, I murmured, I can't take this anymore. Any fleeting resolution to remain on that farm evaporated. I was determined to go to Seoul and succeed. The fourth attempt was the one that worked. He left at night without a word with a friend who was fleeing a forced marriage.

11:17Two young men slipping out of their old lives in the same darkness, each escaping a different trap. This time, Chung did not steal. He borrowed the train fare from a friend. He hated owing anyone anything even briefly, but he hated the alternative even more. This time, his father did not come looking for him. And here's the thing most people miss about this sequence. It's not a story about a restless young man who wanted more. It's a story about guilt. Every time Chung ran, he knew it was costing his family. Every time his father dragged him back, the debt got heavier.

11:51And by the fourth escape, that guilt was welded to him. He carried it for the rest of his life. 65 years later, when he drove 1,001 cows across the demilitarized zone, he was still trying to pay it off. For now, though, Chung-Joo Young was 19 years old, alone in the largest city in Korea, with borrowed money in his pocket and a sixth grade education to his name. He had escaped. But the question was, now what? Seoul was not what he imagined. His biography describes it with no romance at all.

12:21He started at Inchon Harbor, working the docks as a day laborer, hauling freight. When the dock work dried up, he moved to construction. When that ended, he went to a starch syrup factory. He took whatever job would keep him fed for another week. And he was always looking for something better. As he later reflected, the sad reality of farming is that no matter how much one struggles, the payoff never equals the amount of work put in. What he was discovering now was that the city was not automatically better. It was just differently brutal. The work was there, but it was crushing, and the margin between making it and not making

12:55it was razor thin. He was still just barely scraping by. And it was during this stretch, sleeping in a bunkhouse, that Chung encountered something that would stay with him for the rest of his life. And it was, of all things, an insect. The bunkhouse was infested with bedbugs. The workers tried everything to escape them. They moved off the floor and slept on the dining room tables instead. They put pots of water under the table legs so the bugs couldn't climb up. It worked for a night or two. And then one evening, they turned on the lights and saw the bedbugs crawling along the walls.

13:26They had climbed all the way to the ceiling, and they were dropping down from above directly onto their sleeping bodies. Here's how Chung described the moment in his autobiography. And it's remarkable. To this day, I cannot forget the shiver down my spine that I felt back then. This made me stop in my tracks and think. Even bedbugs think long and hard and use every bit of energy they have to achieve their goal. And ultimately, they succeed. I'm no bedbug. I'm a man. These bedbugs can surely teach a man a few lessons.

13:57If these bedbugs can do it, why can't we men do it? We just need to stick to it and not quit. We need to emulate these bedbugs. He added, Whenever I tell people that it was the bedbugs that taught me nothing is impossible if one puts in one's best effort, they think I'm exaggerating. But this really is the truth. You could hear that and think it's a cute anecdote. An old billionaire looking back and giving credit to an unlikely teacher. But I think it's a bit more than that. I think the bedbug story tells you exactly how his mind worked.

14:28He was lying in a bunkhouse, exhausted, bitten, broke, still carrying all this guilt from running away. And instead of seeing pests, he saw a philosophy. The bugs didn't stop. They didn't accept the obstacle. They found another route. The lesson he drew was not complicated. Don't stop. When the path is blocked, keep going until the thing is done. And he would apply this principle for the rest of his life. First, to entire industries. And eventually, to an entire country. He landed a position as a delivery boy at a rice shop.

14:59Part of his pay was a bag of rice every month. And he later said this was the first time he felt like he had made it because he knew he would not go hungry again. But there was one problem. When the owner hired him, he asked Chung if he could ride a bicycle. Chung, of course, said yes. But it was a lie. And it was the first recorded instance that I could find of Chung Juyung agreeing to do something he had absolutely no idea how to do and then figuring it out afterward. It would certainly not be the last. He taught himself to ride a bike within days.

15:30And then he went to work on the shop itself. He was the first to arrive every morning. He swept the entrance. He sprinkled water on dry days to keep the dust down. He did everything he could think of to make the shop run better than it had before he had walked in. The owner's son was lazy, which probably made Chung's intensity stand out even more sharply. And the owner noticed. Six months later, when the owner became ill, he handed Chung the store. The first thing Chung did was to rename it. He called it the, I'm going to get this wrong, so you can laugh at my pronunciation, but he

16:02called it the Kunjil Rice Store, which translates into number one in Seoul. Think about that for a second. Six months before he was a delivery boy, and now he had just taken over the shop through pure force of will and almost pathological frugality. And the first thing he did was rename it number one in Seoul. You can see where his mind was already operating. The ambition had nothing to do with rice. And here's what I think happened during these years and why they matter to everything that comes next. Chung had almost nothing.

16:32He had no money. He had no education. He had no connections. But what he did have was work ethic and his frugality. He was doing the things anyone could do. The things the shop owner's son could have been doing but chose not to do. The things that you could do with a willingness to show up and nothing else. The things you do when you're desperate, not when you're comfortable. By 1938, he was his own boss. He had a business. He had customers. And he was growing. He started hiring friends to deliver all the rice he was selling. He would later write that this brief window was the only time in his life he ever felt

17:04rich, which seems almost incomprehensible given that by 1996, he was the ninth richest person. But that tells you something important about how he was wired. Things did not stay stable for long. In 1939, Japanese colonial authorities imposed rice rationing. They requisitioned every private rice shop in the country. Korean private rice trading was effectively finished overnight. Years of work gone. Not because he had failed, but because someone with more power decided he was not allowed to keep what he had built. It was the first time the world would take something from him, but it would not be the

17:37last. The next year, he was back in business. Chung took out a 3,000 won loan and bought an existing car repair shop. There was one small problem. He had no idea how to fix cars. As he put it later, it just seemed like a good business. So he handled the customer service side and learned the trade from his mechanic friends, which is another way of saying he talked to people and watched them carefully. That had been his method since the rice shop, and it would stay his method for the next six decades. He noticed something almost immediately, and it came hidden inside a customer complaint.

18:09Seoul had only a handful of auto repair shops at the time, and they were all terrible. They all overcharged. They were slow and unreliable. The average shop took 10 days to return a car. 10 days in a city where a car was one of the most valuable things a person could own. Chung saw the problem and solution immediately. Customers didn't actually mind the price. What they couldn't stand was losing their car for 10 days. So he built the entire shop around speed. His shop averaged three days for a repair job, and he charged a premium for it.

18:41And customers gladly lined up around the block. The volume his shop was doing meant his mechanics got more practice than anyone else in Seoul, which made them improve faster, which brought in more customers, which made them finish still faster. It was a virtuous circle. And Chung was spinning it deliberately. He also personally memorized every single auto part in a car. Every single one. That detail is going to matter later in a way that neither he nor anyone else could have guessed. Business was booming, but then a fire destroyed everything.

19:12The shop, the customers' cars inside of it, everything was gone. Chung was left holding debt on a business that no longer existed and on vehicles that had been reduced to ash. His first move was to turn to his employees and say, Hey, it's okay. The building was old anyway. And then he went straight back to his lender. The argument he made was so direct that I want you to hear it exactly as he says it in the book. The fire burned everything down. Now I have nothing but debt. If I stop now, there's no way I can pay you back. Sir, I beg you, give me another chance to set this right.

19:42He's not really asking for sympathy here. He's not explaining away the loss. And he's not really blaming anybody else. He's simply telling the lender very calmly that the lender has two options. Option one, write off the original loan and lose everything. Option two, lend more money and maybe get it all back. The lender said yes. Chung rebuilt the shop from scratch. And this time he grew it aggressively. By 1943, what had been a 20-person operation was up to 70. He was not just repairing cars anymore. He was building a real business with systems, with a staff, and a reputation

20:13as the fastest and most reliable shop in Seoul. But of course, nothing stays good for long in this story. The Japanese intervened again. The war was escalating and the colonial government was stripping Korea of anything that could feed the imperial war machine. They forced a merger of Chung's auto shop into a steel plant. He got 50,000 yen in compensation. And just like that, he was starting over one more time. Later in life, reflecting on the fire and everything else, Chung distilled the whole experience into what became his most famous line. There are trials, but there are no failures.

20:44The idea was not that adversity could be avoided. It was that adversity could always be converted into an education. And education is never really a loss. By refusing to use the word failure, he was refusing to accept the finality the word carried. He changed the language. And by changing the language, he changed his own emotional response before it could even set in. The rice shop being seized was not a failure. It was preparation for the auto business. The auto shop burning down was not a failure. It was the argument that got him a second loan.

21:15The wartime merger was not a failure. It was 50,000 yen and a set of skills he would carry into whatever came next. And what came next is Hyundai. By 1943, Chung Juyung was 28 years old. He had built two businesses and lost them both. He had been wiped out more times than most people will be in their entire lives. But he did not stop. He did not slow down. He did not accept the given pace of things. When the path was blocked, he found another path. He went up the wall, across the ceiling, and dropped onto his target from above.

21:47And he was just getting started. After the war ended and Korea was liberated from Japan in August of 1945, Chung went back into the auto repair business. He was servicing vehicles, making a living, and steadily rebuilding after everything the Japanese had taken from him. And at some point during the stretch, his mother came to visit him in Seoul. He was taking her around the city on a trolley, showing her how far he had come from the farm. At one point, he gestured toward the grand headquarters of what had become the Japanese

22:21government general, one of the most imposing buildings in this city. And he told her, Mother, one day I'll become the richest man in Seoul and live in a house even bigger than that. His mother, who you will remember, was not a woman known for letting anyone have the last word, told him, Now listen up, farm boy. You came here with just your two balls. You, the wealthiest man in Seoul, get your head out of the clouds. You have a life to live. Chung's response was simple.

22:51No, I'm going to make it. So much for a mother believing in their son. But now we're at the fun part. Everything he had built so far was about to get channeled into something much larger. Something that would eventually carry his name around the world. And it would nearly kill the company before anyone outside Seoul had even heard of it. The sponsor of this show is CoinShares. While most of the industry was still arguing about whether digital assets were legitimate, CoinShares was quietly building the infrastructure to invest in them properly.

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23:49The first thing he did was name it. He named the company Hyundai, which in Korean means modern. Think about the audacity of that name. Korea in 1947 was anything but modern. It was a country just emerging from 35 years of colonial rule. Shattered and impoverished. And spoiler alert, about to be made worse by a civil war. There was almost nothing modern about it. But Chung did not name things after what they currently were. He named them after what he intended them to become.

24:21He had done this already when he called a rice shop number one in Seoul. And now he was doing it on an even bigger scale. The name was a promissory note. Korea was free from Japan. Korea could now become modern. And Chung was going to be the one to build it. For a while, he was running both the auto shop and his new construction outfit at the same time. And the pivot from one to the other happened in a way that was pure Chung. He was sitting in a government office one day waiting to submit a bid for some automotive work. When he watched a construction company come in and collect payment for a completed job.

24:56The amount of money that changed hands just simply floored him. It was so much larger than anything he was dealing with in auto repair that the math broke something in his head. He was back on the farm in a sense. He was doing exactly what his father had done. Working incredibly hard day after day. And a business with a payoff was linear. It was never going to equal the effort. It wasn't that the auto repair business was a bad business. It was that construction was a vastly better business. Construction contracts paid 10 to 40 times what auto repair did.

25:27You could work just as hard in construction, but for a radically different payoff. His partners thought he was crazy. They were a small but capable auto operation, and they knew nothing about construction. But Chung had worked on construction sites during his runaway years as a teenager, and he figured he understood the work well enough to learn the rest. He also understood something about himself that his partners did not. As he put it, success is 90% determination and 10% confidence. So he merged the auto shop into the new venture and went all in on Honda engineering and construction.

26:03He was betting everything on a business he barely knew in a country that was about to be engulfed by war. On June 25th, 1950, North Korea forces crossed the 38th parallel and invaded. The Korean War had begun. Chung abandoned his construction projects and fled to Seoul as the North Korean army advanced. He moved his family south to Busan, the port city at the southern tip of the peninsula, and he set up a new headquarters there. He could have waited the war out, and he could have hunkered down and just tried to survive.

26:35But we all know by now that that was not how Chung Juyang operated. He needed business, any business, and Busan had something very specific to offer, which was the U.S. 8th Army. The Americans had a massive presence in the city, and they needed housing, roads, and the infrastructure of a semi-permanent occupying force. Somebody was going to build it, and Chung intended for that somebody to be him. His younger brother became crucial here. The brother was proficient in English and had built good relationships with the American military

27:07engineers. And in a country where almost nobody could communicate directly with Americans, that was a massive competitive advantage. Through his brother's connections and through relentless, consistent delivery on every job they took, Hyundai became the construction firm the Americans started to turn to first. Chung understood the American military's priorities the same way he had understood his first auto customers' priorities back in Seoul. It was the same insight applied to a different buyer. Speed and reliability mattered more than cost.

27:40Do what you say you will do when you say you will do it. The Americans didn't want excuses. They wanted results. And Chung had been delivering results since he swept the floor of that rice shop. There's one early job from this period that tells you almost everything about how Chung was going to operate for the next 40 years. In December of 1952, President Eisenhower visited Korea. U.S. military authorities wanted the graves of fallen UN troops at a military ceremony to be covered with green grass for the visit. That was the specification.

28:12Green grass. But there was one problem, and it was a big one. It was the middle of a Korean winter. Green grass in a Korean winter was not just difficult. It was darn near impossible. Anyone else would have asked for a deadline extension or explained the situation and requested more time. But Chung transplanted green barley instead. The graves were green, the job was done on time, and the Americans were satisfied. Chung didn't argue with the constraint. He did not explain why the constraint was unreasonable. He simply reframed it. And that willingness to redefine the constraint rather than be defeated by it and then to

28:47execute fast became Hyundai's entire operating signature. It is the bedbug lesson all over again. When the path is blocked, find another path. Go up the wall, across the ceiling, and drop onto the target from above. War, it turned out, was good for the construction business. Hyundai grew steadily through the conflict, building for the Americans, learning from the Americans, accumulating capability with every contract. But Chung also understood that wars end.

29:18So even while fighting was still going on, he started to look for civilian projects. The Korean economy was shattered. Government contracts were scarce, and the margins were razor thin. It didn't matter. He had Hyundai bid on all of them. He was not chasing a windfall. He was building a company. He was building a reputation. And every contract he completed, no matter how small, no matter how unprofitable, was another deposit in a bank account that he believed would pay compound returns for decades. When the armistice was signed in July of 1953, Chung was 37 years old.

29:53He was running a construction firm in a country that was about to need more building than perhaps any nation in history. Everything above ground had been leveled. The roads, the bridges, the factories, the power plants, all of it had to be rebuilt. The only question was who was going to rebuild it. Chung intended for that person to be him. In April of 1953, three months before the armistice was even signed, the Korean government awarded Hyundai its biggest contract yet. The job was to restore the Grorian Bridge, a major crossing that had been destroyed during

30:26the war. The government wanted it to rebuild fast, not just for civilian traffic, but to move forces against guerrilla fighters still operating in the area. The contract was worth more than half a million won, and Hyundai had 26 months to deliver. This was the biggest job Chung had ever won. Not only did it have the most money, it had the most visibility. When the contract came through, he celebrated. Hyundai was about to enter the big leagues of Korean construction. But as the lesson goes, never count your money when you're sitting at the table.

30:57The celebration would prove premature. The problem started almost immediately. Only the bare skeleton of the old bridge remained, which meant almost everything had to be built from scratch and flowing water 10 meters deep. And Honda had never done anything close to this scale. When Chung's engineers tried to figure out what equipment they needed, they quickly discovered that the right equipment could simply not be found anywhere in the war-torn country. What they had to work with was a 20-ton crane, a concrete mixer, and a compressor.

31:28Everything else had to be done by hand. They were just getting started when the floods came. The water swept away their scaffolding, and they had to start over. Then came the inflation. And the inflation is what nearly destroyed the company. When Chung signed the contract, a unit of oil cost 7 won. By the time the bridge was finished two years later, it cost 45. A single sack of rice went from less than half a won to 41. That's not a typo. That is nearly a hundredfold increase. Every material, every wage, every supply cost him more and more each month.

32:02And the price of everything was climbing so fast that planning became almost meaningless. Chung had accounted for inflation when he'd been on the job. He had expected it to be significant. He thought it might be 100%. He was still off by a factor of 10. And here was the trap. The contract Chung had signed was a fixed-price contract. The government was going to pay him the agreed amount and not a single won more. It did not matter that the world had changed underneath him. The contract would not adjust. So the losses started piling up, compounding week by week with no ceiling in sight.

32:36Every day the bridge was not finished was a day the hole got deeper. Workers stopped getting paid. Some even went on strike. And then the creditors came. They did not knock politely. They showed up at Chung's office demanding their money. And when they didn't get it, they came to his home. Chung's son was a small boy at the time. And his first clear memory of childhood was creditors breaking into the family house with an axe. Can you imagine? That's crazy. Chung carried that for the rest of his life. The fact that the pressures he had taken on had reached through the walls of his home

33:07and touched the people he was supposed to protect. His top people came to him with a proposal. They were his brothers and his brothers-in-law. They had staked their own lives on Hyundai. And they told him, stop, stop building this cursed bridge. We're losing more money by the hour. The losses are already near catastrophic. And continuing will only make them worse. Any other firm would quit, cut our losses, and survive. We need to walk away. But Chung didn't know how to stop, so he refused.

33:38And his response tells you exactly who this man was. Not just as a businessman, but as a human being under extreme duress. He said, quote, You mean you want me to take down our sign? If you're suggesting that we stop construction at this point, you're basically saying we close down our business. Trust is everything to a businessman. The moment you lose trust, it's all over. It's my dream to create the best construction company in the Republic of Korea. And you're telling me to abandon it all?

34:08Whatever happens, we're going to finish this job. We have to. His brothers were telling him the rational thing. Stop. The math is clear. You're bleeding out every day. You continue to bleed more. Just walk away. And Chung heard them. He understood the math. He was not a fool. But he was calculating something they were not. He was calculating the value of that sign. And Chung heard them. He understood the math. He was not a fool. But he was calculating something that they were not. He was calculating the value of the name.

34:39The name Hyundai and its reputation. The trust he had spent years building, contract by contract, starting with the Americans in Busan, starting before that with the auto shop, and starting even before that with the rice shop where he arrived first every morning and swept the entire entrance before anyone asked him to. If he walked away from a job, any job, in his eyes, his reputation and credibility would be destroyed. His brothers were so moved by his refusal to quit that they went home and sold their houses.

35:10When Chung found out, he burst into tears. Then he sold the land under his original auto repair shop, the place where Hyundai had been born. Together, the family raised almost a million won and put every last penny of it into this one project. They went all in. And when that ran out, they borrowed more. At interest rates as high as 18% per month. Let that number sink in for a second. 18% per month. Not per year. Per month. That is the kind of interest rate you accept when you believe one of two things.

35:41Either that you will finish fast enough, that the interest won't matter, or that the alternative to borrowing is worse than any interest rate. Chung found himself in the second category. In May of 1955, the bridge was finished. The final accounting was brutal. The contract paid Hyundai 547,800 won, which had seemed like an astronomical sum when they signed it two years earlier. But the project had left them 650,000 won in debt. They had spent more than twice what they earned.

36:12His competitors were merciless. What would a sixth grade dropout know about construction? And here's the part that gets me. Chung kind of agreed with them. He didn't blame bad luck. He didn't blame the government for the fixed price contract. He didn't blame the floods. He didn't blame the creditors who had broken into his house with an axe. He blamed himself. He had not understood the riverbed conditions. He had not known what equipment the job truly required. He had rushed into a bid far beyond his capability

36:43without understanding what came after winning it. There was a line from a Chinese classic he returned to often after this nightmare. The root of failure is planted the moment you achieve your goal. His goal had been to win the bid. He had won it. He had celebrated. And he had not been prepared for what came next. He would not make that mistake again. But he also would not call the bridge a complete failure. He had finished it. He had kept his word. He had not defaulted on the contract. And he had not abandoned the project. And importantly, he had not cut a single corner.

37:15He just took the loss. There may be periods of hardship, Chung believed, but never complete failure. The bridge was hardship. It was not failure. And the difference between those two worlds, in his mind, was the difference between a company that survived and a company that disappeared. What happened next is crazy. Someone had been watching the whole time. While Chung was selling the land under his own company to pay for a bridge, that was costing him more every day. While his brothers were selling their houses and while creditors were coming at him with an axe, the Korean government was paying very close attention.

37:46They had watched Hyundai take a job that was clearly too big. They had watched the floods wipe out the scaffolding. And they had watched the inflation gut the contract. They had watched Chung refuse to quit when every rational calculation said he should. And they had watched him deliver exactly what he said he would in the time frame he said he would do it. When the Ministry of the Interior assigned credit scores to the country's construction firms after the war, Hyundai's was the highest in Korea. Not because they had made money. They had lost a fortune. They got the highest score specifically because they had finished on time.

38:19In a country full of contractors who over-promised and under-delivered, who walked away constantly from jobs the moment the math worked against them, Honda had done what it said it would do. They were the clean shirt in a closet full of dirty ones. And when the government contracts started flowing, Hyundai won them. Chung would later tell a group of businessmen who came to him looking for capital, trust is everything to a businessman. The moment you lose trust, it's all over. If I have to choose between reputation and money, I will always take reputation. He believed it because he lived it.

38:51The bridge was proof. He had chosen reputation over money at a cost that would have destroyed most people. And the reputation had paid him back many times over by the time he said that. The bridge also taught him something specific and operational. He had gone into the biggest job of his life without the right tools. Even worse, he hadn't known what the right tools were. He could not read the conditions of the riverbed. He could not assess what equipment the job demanded. He had been guessing. And the guesses had almost killed his company. He swore it would never happen again.

39:22So he set up a dedicated heavy equipment office inside Hyundai. Its only job was to acquire, repair, and remodel every piece of construction machinery they could get their hands on. And if they could not buy the machine, they would build it from scratch. This is where something interesting starts to happen. Chung catches a bit of a break. And the break is actually the return on something he had invested in years earlier without really knowing he was investing. LinkedIn is pretty amazing at helping you grow your small business. We cannot make your email response time faster.

39:54We can help you sell, market, and hire in one place. We cannot help you find space for your three desk drinks. Why do you have three? And while we can't help you find the perfect volume for your presentation video, LinkedIn can help you find the perfect audience for your business. Grow your small business on LinkedIn. Learn more at linkedin.com slash small business. Because of his wartime work with the Americans, they were the only Korean construction company registered as direct customer of the U.S. 8th Army.

40:27If a competitor wanted to buy high-tech American equipment, they had to go through a middleman and pay a markup. Hyundai bought direct. And here's where the auto shop pays off. Those years, Chung had spent memorizing every single auto part. The years his partners had thought were beneath him gave him an edge his competitors did not have. He could look at a piece of American construction equipment and know exactly what it was worth. The other construction bosses in Korea were just guessing, but he knew. Nothing in life had ever been wasted. Every phase was quietly funding the next one.

40:58In 1957, Hyundai won the contract to restore the Han River Bridge in Seoul. This was the same bridge that had been destroyed in the opening hours of the Korean War. And the symbolism was hard to miss. The newspapers called it the greatest construction project of the time. And it was one of the largest projects announced since the war. Hyundai finished it in months. The Gorian Bridge had gotten the attention of the government. But the Han River Bridge got the attention of the entire country. Hyundai was now counted among the top five construction companies in Korea,

41:29out of more than a thousand. And then Hyundai just kept building, bridge after bridge. They would go on to build 13 bridges across the Han River alone, including Korea's first suspension bridge and its first cable-stayed bridge. Every one of them was a deposit into the account Chung had been filling since the day he swept that rice flour shop. This was now his pattern, and it would repeat for the rest of his career. He would take a contract that looked punishing on paper, finish it no matter what, and use the trust he earned from finishing to win the next contract,

42:00which was always bigger. He was doing the same thing he had done since the rice shop, just at a larger denomination. Take what you have, even if what you have is only your willingness to show up first and leave last and work hardest and convert it into something more valuable than money. Because money follows trust. Trust does not follow money. Here's what you have to understand about where Korea was in 1960. The country had a per capita income of about $80 a year. That put it on the same level as Ghana and Sudan,

42:31and slightly behind India. People were sleeping and starving in the streets of Seoul. Private cars were a novelty. Electricity and running water were luxuries. A group of the U.S. State Department experts, after studying Korea's prospects in depth, concluded that Korea was an economic basket case that would always depend on American handouts for its existence. The World Bank was no kinder. Not that these experts are actually right very often. When they ranked the Asian countries most likely to industrialize, Burma and the Philippines were near the top.

43:02Korea was near the bottom. Nobody outside of Korea, and very few people inside it, believed the country could become anything other than a permanent charity case. Remember that, because what Chung did next only makes sense when you understand how desperate things were. Honda had been doing U.S. Army construction work since the war. Quick jobs, simple specs, get it done fast. But in the late 1950s, the nature of the American work changed. The U.S. military started building permanent facilities to American standards. Real buildings with real specifications.

43:34Documents running hundreds of pages with equipment clauses that had to be met exactly. Quality requirements that had to be demonstrated, and engineering tolerances no Korean company had ever been asked to hit. Chung and his employees could barely read a page of them. And this is where you get a glimpse of kind of what separated Chung from almost everyone else running a company in Korea at the time. He had zero shame about not knowing things. None. Maybe it was his lack of formal education, and maybe it was just how he was wired. But in a culture where hierarchy and saving face mattered enormously,

44:08Chung would ask anyone anything, regardless of their rank or age, or whether the question made him look foolish. His attitude was simple, and he drilled it into every one of his employees. It is not shameful to ask about something you do not know, even if you have to ask somebody younger or a lower rank than yourself. He had a line for it that cut right to the point. Fixed thinking is what makes fools. Pretending you knew something you did not, performing competence instead of actually acquiring it, that was the real stupidity.

44:39And Chung had no patience for it. He wrote, Not receiving formal education does not mean one is lacking in wisdom. It's a mistake to think that broad and deep knowledge can only be obtained through formal schooling. So, Hyundai asked the Americans about everything, no matter how basic. They asked the technicians how to read the blueprints, how to meet the specifications, how to operate the equipment, how to sequence the work. And on every work site where the Americans were present, Chung rotated as many of his own workers through as possible,

45:10so they could absorb everything from their counterparts on how to do it the American way. Each site became a classroom, and each contract was a new semester. And when they still didn't know what something was, they just figured it out. During one paving project at the Osan Air Base, the specifications called for a batch plant to mix concrete properly. Chung had never seen a batch plant. He didn't know what one was. So he sent a subordinate to another construction site to find out what one looked like. The man came back with a description.

45:41Chung drew up the plants himself, and had his engineers build one from scratch. On another job, he needed to lift a 110-ton gate into place. But he did not have a crane big enough, so he used two 60-ton cranes in unison. It violated standard practice, but it worked. And this went on for years. Chung wrote that he never had enough English speakers to translate properly. They always struggled to constantly find the equipment to match the specs. And the gap between what the Americans expected and what the Korean companies could deliver

46:12was at times humiliating. But they kept learning, one day at a time, one foot in front of the other. Every technique, every standard, every procedure. And slowly, through sheer stubbornness and a refusal to stop asking questions, Hyundai went from being unable to read the American spec manuals to planning entire projects using those same standards. Chung later described the whole Korean construction industry as being dragged, sometimes kicking and screaming, into modern times by the demand of the U.S. Army work.

46:43The American military, without ever intending to, had become the most effective vocational school Korean construction ever had. Now, to understand how Chung ran all of this day-to-day, you have to understand just what was driving him. And it's easy to hear what I'm about to describe and conclude that he was just a control freak. But he wasn't. Or at least, that's the wrong way to frame it. What drove Chung's management style was not a need of control. It was a need to compete. He was aware at times that Korea had to compete with Japan and had to compete with every other industrializing nature,

47:15or the country was never going to climb out of the hole it was in. The State Department had written Korea off. The World Bank had put it at the bottom of the list. And Chung kind of took that personally. He saw it as his responsibility, as a point of national honor, to prove them wrong. And that meant every worksite, every project, every single day had to be run at maximum intensity. His country could not afford anything less. Chung did not manage from behind a desk. Every morning, first thing, he went straight to the nearest worksite.

47:46He believed that a person in a position of authority is a role model for everything. If a CEO does not lead by example and merely orders workers around, his words will fall on deaf ears. He visited the heavy equipment yard at least once a day, often twice. And the second visit was the whole point. Here's how it worked. He would arrive in the morning. Everyone would be working hard, braced for the boss. They knew his reputation and wanted to impress him. He would inspect, nod, and then leave. And the workers would relax. The pressure valve would release.

48:16And they would slow down, just a little. The coast was clear. And then, the boss would come back. The people who had been lounging would scramble to their stations. Chung took quiet satisfaction in this. He believed the standard was not something you performed for an audience. The standard was the standard all the time. You worked at full capacity whether someone was watching you or not. And if you didn't, the solution was to make sure someone was always watching. He called the project supervisors at all hours of the day and night to ask if certain tasks

48:46had been completed. He gave his workers less time than they needed to finish a job, deliberately, because he believed that people