Rapid Fire Business Ideas, How to Buy a Public Company, and Mastering Your LinkedIn Profile

Every time I've had a s company sale when we sold Bow to Twitch When we just sold the milk road. You have been our we would call the deal doula. You help us, you know, go through that labor process and come out the other side with you know the the happy ending, I guess. Welcome to My First Million. Uh Subing in for for Sam Par today and like every substitute teacher, it's always the best when they're there. Um we

We're gonna do a bunch of things. We're gonna talk about Some of your the companies you started. companies you've invested in, things are you know, some ideas you have. You were the first ever episode of the podcast. So if people want to hear your life story, that's the place to go. Episode number one Um we've come a long way from there. Did you think This is what would happen.

Uh, I always knew the podcast was gonna be big, and uh I think from the very beginning you were like, Let's do Barstool except for business. And that's what it's become, and it's huge. And I actually think it's gonna be way bigger in a year than it is today, like three times the size a year from now than it is today. Uh yeah, I hope so. That's the uh that's the goal. Uh the we did the kind of barstool thing except without hiring anybody. It was like okay, we will just be the jackasses and then like let it go from there. Um

All right, so I got you sent me this doc, which is great,'cause there's a bunch of topics here that I kinda wanna jump into. You uh I guess we should set the the the the like groundwork here. So I'll give your very short life story so people understand who you are. You um You

worked at a job for like a couple of years. You did like the traditional path. You worked at Microsoft. You quit, you decide to start your own company. This is right when the Facebook app platform comes out. So you start building Like silly Facebook apps that go viral. So uh think things like superlatives. Which was um Like which of your friends is most likely to do X and uh

It would invite those friends to like Do it too and it grew like crazy, but it was like a Silly Facebook app, so you didn't know what to do with it, but you Ended up selling it. So you got That was your kind of my first million moment. So you sell it.

Um You're how old at that time, like twenty four, twenty five ish, twenty six, maybe? Uh yeah, twenty six. Twenty six. Take that and you go on the next big wave, which is Uh mobile apps are gonna be a thing.

you are creating games. I think maybe first on Facebook and then on the iPhone when when when the iPhone app store comes out, you're like, oh, this is gonna be big. You create a company called Tiny Uh or Tecnico. And um end up Somehow You raise money from Andreessen Horwitz, you're living the dream.

Things go south as the economics of that business change. And then you go all in. In this Hail Mary strategy, which again, episode one for the whole story, you go all in on this Hail Mary strategy of like we're gonna get the rights to family guy. And you end up somehow as a startup that nobody's ever heard of Getting the rights to the license to to make the Family Guy mobile game. You did it for Harry Potter and a couple other big IP things, sell that company.

Um And then I met you after that. So I met you kind of when you were selling that thing. We met at a a dinner that Sam was throwing because you were speaking at HustleCon. And immediately we hit it off. We were we made some big plans. We were like You know, you were talking about Tony Robbins. I was like, Oh, I'm a Tony Robbins guy. You're like, really? I don't even know about Tony Robbins. Tell me. And I started gushing about my experience there or whatever.

And I was like, Yeah, we should do that here in San Francisco. Like, let's do it tomorrow morning. Let's have a our own power session with people like us who are just, you know, electric. And uh Yeah, we were like, uh Tony Robbins is amazing. Nobody is doing this um in this kind of modern way. Let's put up some Facebook ads today. Um And then tomorrow let's have fifty people in here and try our hand at like being Tony Robbins for a day. We did the thing where you spent twenty minutes being like this is great. This is a great idea. This is a this is a no brainer. And we just keep talking about how much it's a no brainer, how much it's a it's I am dunk, we're gonna do it, we're using all these terms. Never did it.

Ten years later we've still never did it, but we became good friends along the way. And it would be the most fun weekend ever. Yeah, I think I still think we should do it. We uh but then we you we kinda got uh I guess from there you you did a couple things. So your brother started Native Deonerant, you kinda helped him with that. You started another company, which we don't really talk too much about. Then I Well, starting my e commerce brand, you have helped me out a lot with that and uh or kind of a a a shareholder in that business. Um

And when we were every time I've had a s company sale when we sold Bebo to Twitch When we just sold the milk road. You have been our we would call the deal doula. You help us, you know, go through that labor process and come out the other side with, you know, the the happy ending, I guess. Um

So that that's kind of like how our interactions have been like on a business side and then become great friends uh since then. So that's my intro. Did I miss anything? Um I love being the deal doo, by the way. Uh Uh when we sold Tiny Co we had this banker named Dick Filippini And he uh ran

He was our banker, ran the transaction for us, and I told him that I loved what he did so much. I just wanted to work for him for free for six months after this. So I could see all of the deals that he was doing. And uh he did not accept my offer. And said, No, you you can't do this. Dick is great. He helped us for free when'cause Bebo was the Bebo deal was gonna be too small. He does bigger deals, like I think like hundred million dollar plus type deals.

Um It was too small, but he got on the phone with me several times throughout the process, talked me off Allege multiple times when I was like, I'm just gonna say this. He's like, No, well, you should probably just wait and see what they say. Um, and his advice was basically just like Don't F this up, you know, son. And he was totally right. He helped me a ton. And actually, I still feel the guilt that I didn't like send him a gift after texted you like a year later. I was like, what's Dick's address? I didn't send him a gift. I can't believe I didn't. And here I am still four years later. Have not sent that gift. Dick, I'm so sorry you were so helpful.

And I will say this gift. The deal, uh another deal that Dick did that I thought was super interesting was he sold Applevin to a Chinese company for uh one billion dollars. And the Trump administration blocked the deal or the FTC blocked the deal. And uh instead of it being a billion dollar sale the Chinese company invested a hundred million dollars into Applevin.

And then uh couple years later, Applevin so everyone I thought would be devastated, like the founders were like We're gonna become so rich overnight was we sell this company for a billion bucks. Transaction doesn't happen, I assume founders are sad and upset. Then a couple of years later the company goes public and at some point it was worth thirty billion dollars as a publicly traded company. Yeah. So it's such an amazing transaction to not have had uh closed. Well they got the best of both because they

Whatever the company was putting in, I think it was one point six was the original one point four, one point six was the original purchase price and they were gonna put in a few hundred million dollars. to own seventy or eighty percent of it. And then instead it was like the year went by, nothing happens. And so with that anxiety came this big payoff because the business grew like crazy in that time. So they're like, Hey, okay. Same deal, but now you own like twenty or thirty percent. And so they got the money, they got liquid on that. But they only had to give up a tiny fraction and then they sold it again they went public.

Um you know, later for for way more. So that turned out You know, pretty much as good as it could go, right? Like they got both. Uh just had to wait a year. Um, speaking of kind of like acquisitions. I got a I have a milk road related question for you first, which is Um

You saw you saw both the acquisitions that I did c uh from like sort of start to end and I shared, you know It's like in high school when it's like The boy texted me this. Should I apply this? Should I say this? Like, no, no, no, that looks too needy. Say that like change the period to a comma and then just Yeah, cut that last line.

Like it's that level of help that that you were doing with me. Um what's your I've given kind of my debrief of the acquisition. I'm just curious. What's your uh what was your takeaway or what was your what are some nuggets that that you would you would share from uh from watching that go down? Um I love the deal structure that uh Milk Road ended up with, which was a bunch of cash up front, and then um a bunch of equity in the new company.

Where those two guys are wanting to grind it out for years and build a giant business. And uh those guys in my head You know, some percentage of the work that they do is just creating value for you and Ben. And that's awesome. So I love that deal structure.

Uh The In my head, uh, kinda having been through this a couple of times, I feel like a lot of the Um you know, text the nuance of words.

that you care about when you're trying to sell your business. The buyer doesn't care about that much. Um And it's more of a emotional thing than a practical thing where Practically the buyer is like

I wanna buy this business because of the strategic reason and the revenue and the profit. And A lot of the things that Um You can be squeamish about or uncomfortable to say, or

Not sure how to say Things. Um I think a lot of that stuff doesn't matter. w one of the things that I learned uh actually when I was trying to sell Tiny Co was Um We ran a sales process where I was trying to sell the business and we talked to a bunch of uh acquirers.

And We got pretty far along with one, um and then the deal didn't happen. Uh And then a year later we went and sold the company um successfully. And the

Um, there's a bunch of stuff that I was trying to keep close to the chest and I was like, Oh, people aren't gonna want to hear this, people aren't gonna want to hear that. And what was great about a banker and Some somebody like Dick was Uh he was like, No, actually this isn't a big deal. Just tell these guys this and uh they're not gonna care about that. So it took uh this kind of unc discomfort I had around like

Things I thought were secrets that I needed to take to the grave with me. And he just made me comfortable telling them about them. Sam Sam did something for me in this process. So as we were selling the milk red, I was like, Yo, uh any kind of tips or advice you've had in the w when he sold to HubSpot, he goes Oh he goes. Just do uh just tell them up front.

all the shitty things about your business that they that might scare them away because Guess what? They're gonna find those anyways when it comes to due diligence and you're just gonna be You know, four weeks in or six weeks in Emotionally invested. And it's gonna get ugly later and they're gonna feel like they just found some like, you know, big wart on the deal at that point in time.

Um And he goes, just tell them all the skeletons your closet now and be like here's all the reasons you shouldn't buy this company. If these bother you, you now know them and you can decide for yourself, you know, if that's uh a deal breaker for you. This was like not the very first thing, but shortly after. Like we went to a dinner And everybody was interested. We hadn't even fully negotiated the deal, but I just said They're like, you know, any questions you guys have or you know, any c any concerns. I said, Well, you know, I wanna make sure like you fully understand this business

Um And you know, I've been through this a couple of times and I just I know like Um it's better to just be fully transparent. So I said, Yo, here's all Uh I made a list of the reasons why, you know, you shouldn't buy this. Here's all the skeletons in our closet and you can look at these today and you could You can decide if this is too um

Too concerning for you, you know, let's talk through these now. And we did it. And later, af after the deal was closed. We did a debrief and they they basically this is how you know they're smart. They're like, What could we have done better in the acquisition process? Like Uh you know, from your point of view. And I we're we asked the same. How was that for you? Uh was that good for you? It was good for me. And it was like We we told them uh our they told they gave me that feedback. They were like

You know, you said something at this dinner where you were just like, Here's all the ugly parts of our business and like let me just tell you about them and we could talk through them. They go, that built so much trust because we didn't know you very well. And immediately we were like, Oh, okay, we felt we felt at ease and Um we felt like we could trust you guys going forward. And so that turned out to be a big win. And that's Exact opposite. My you know, the I think the entrepreneur's instinct is

Hide that, you know, as far put it behind your back. You know, if they if they if they ask for it, you show'em, but like Don't scare them away. And and and in fact what you want to do is Like Find out as quickly as possible. if there's a real match here or not and use that as a

Uh versus to build distrust by not Disclosing it up front. The other thing I've seen entrepreneurs do that I I um think is also kind of

Uh the wrong common sense out there. is uh when you ask an entrepreneur if they want to sell their business Entrepreneurs are told to say no, I do not want to sell my business. And they expect that the buyer is gonna come over the top and say

Even if you don't want to sell your business, we're super interested in buying it. We'll do anything it takes. Uh, please come talk to us. And in practice, that's not at all how it works. Uh oftentimes a buyer is looking at a bunch of different businesses to buy at that point in time. And so they'll reach out or talk to ten different businesses.

Five of them will say, No, we're not for sale. And they'll say, Okay, great, we're knocking these five off. We're gonna focus on the five that have said, Yeah, we are for sale. Right. And so what's the way to say yes without seeming desperate there? Or seeming too w too eager to sell. You don't want to do that either. I think the way I've done it before is um

One w when I was ready to sell a business, I would uh Find somebody that I knew was interested, but wouldn't have a good offer. and get them to make an offer and then say, Cool, uh go that enables you to reach out to other people and say, Hey We have an offer to sell the business. And we're thinking about uh whether or not to do that.

And you are somebody that we think there's a great strategic fit with. So we thought to talk to you before we did something else. Yeah. Yeah, so that's like one way to do it. If they come inbound, it's sort of like um You know, we have had interest and nothing you know, nothing felt Felt right, you know, we really like our business.

Um But you know We respect you guys and if that's something you you know, we're we'll obviously be open to listening. Uh you know, we So you kind of you just say we like our business, we had interest, it hasn't we we we didn't really nothing went too far'cause we weren't very You know, weren't too keen on it.

What? You know. Really like you if you want to Talk. Like we're open to talking. There's nothing you know, that's fine. Yeah. Um yeah, I think that's a good setup. And uh I think buyers who are experienced can kinda read between the lines pretty quickly.

Uh'cause what you just said is like, I'm wide open. Somebody please ask me out for a date. I'll I'm ready. Uh, you know, and I'll be a cheap date. Exactly. But like it's the signal. It's the signal that I'm interested without like um Without begging you. Uh but it's like to be clear, I'm interested. Yeah, yeah, it's perfect. It's like looking at somebody across the bar for and catching their eyes. Um

Their eyes for one second and then smiling and looking away. There was a another meeting. We won't talk we won't name the name, but you were a part of a few of the meetings as we talk to different people from Milk Road. And it was the first meeting with one of the buyers and you you immediately call me afterwards and you were like, Wow. And then you said, uh, there's this phrase, a fool and his money are easily parted, and you immediately sniffed out that this person was Sort of an idiot. Um, and like you know would would would be

And sure enough, they made the the by far the largest offer Um And you know, turned out to be you know, they turned out to be not not exactly who we we didn't go with them because of that, but uh of of the three or four people that we talked to, this was one of them, but you sniffed that out immediately. What what tipped that off for you and uh what can you say without getting us in too much trouble? Um you know, there's a lot of people who are Charlatans nowadays.

And uh they'll often lead with a lot of like flattery and not substance. Um Like it's very easy for me to d tell when somebody is like Hey, this is who I am. I've done X, Y I started this company, I sold it, I started this company, it didn't work out.

They're just like honest about their resume and there isn't Tremendous amounts of puffery. that with a couple of Google searches you can be like, actually that's all not True. Right. You've said a lot of words, but you haven't said anything yet. Okay. That is uh

You know, either I'm not understanding what you're trying to say or you have nothing to say, basically. Yeah, that's right. And they don't lead with like numbers and information. They lead with uh Like flowery language that doesn't go anywhere. So I'm curious, um What are some of

business ideas that uh you think somebody could start That would be successful, either at the smaller scale, like I think this can be, you know, like a clear business that'll make a few million bucks that I just think, you know, if somebody out there's looking for a way to get financial freedom, this is a way. Two

Here's a big idea. Somebody who is willing to grind that out should go do this. Um, the big idea that I like the most right now is um Robin Hood for real estate. So uh You know, Robin Hood makes it easy to invest in uh the stock market. Um

And the way I've thought about this is I've got a ton of friends who are you know, in their twenties that work at uh Facebook or Google And they make a ton of money. But uh what they do with it is they just stick it in their uh bank account or in a savings account or a CD. Uh sometimes they'll invest in the stock market.

Um I think it's so hard to be able to invest in real estate. And if there was a turnkey way through a mobile app to be able to invest in real estate. Uh I think that would be huge. I think it's really different. You you did this um investment and

And I followed you uh in a company called Jar. In India. And so they make it super easy to invest in gold. in India. And so you can invest with a dollar or fifty dollars or five thousand dollars.

And just by going to control like a one click. If you believe that gold is a good thing to invest in, we'll make it easy for you to do that thing that you already think is a good idea. Exactly. And so it's a one click thing of like how much money do I want to invest today? And then uh they the best way to do it is to kind of set up a subscription where every month you're like, cool, I'm buying two hundred dollars of gold every month and ten years from now it's gonna be worth millions of dollars.

Uh I think the same should happen with real estate. There's a bunch of companies that are like Cadre and um Fundry or Crowd Street. Yeah, whatever those are like But you have to look at the individual deals. You have to m they're targeted towards um people like me who like investing in real estate.

And who are sophisticated about it and wanna know what a what the cap rate is and the location and the year of construction and all this stuff. Um I think there should be a one click way to be able to go buy equity in rental properties that generate income. And uh It should be marketed.

to um people in their twenties. It should be marketed through Facebook. It should be set up so that ever you basically log in and are like, Cool, you wanna invest in real estate? How much do you want to invest every month? Two hundred dollars? Great. Two hundred dollars is now happening in real estate. You're now investing two hundred dollars in real estate every month.

And boom, it doesn't ACH from your account every month. on on the customer side and invest in that real estate. And the income that gets generated goes back and r reinvests in more real estate. And that's it.

And so it shows uh this is how much you've invested so far and here's how much it's worth. Oh okay. Love it. Give me more. What else you got? Uh what else do you got? Hey, hey, hey. Whoa. Whoa, whoa, what's going on here? I'll give you one that like

I think is I I give you one that I get asked a lot, which is not actually what's a big idea. But what's the easiest way to get to like a million dollars? Um And I always think that like

The easiest way to get to a million dollars. If I'm if I need to get to a million dollars right now, here's here's what I would do. I would Um I would create an agency that's gonna target a really specific part of a business that makes money already and just figure out how to make more of it. So for example Emo marketing for uh e commerce brands or con conversion rate optimization, CRO.

For for companies. So you basically say, Hey, visitors coming to your site, we can help you convert more of that traffic into sales. And I think there's such a easy play where you basically just create content. So you create content that basically just says like Here's the before and here's the after. Look, I change these three things because I call this my

You know, my hot cold hot method and um we boost the revenue by thirty two percent. By the way, if you want somebody to boost your revenue by thirty two percent, work with me. And I think that this is like a such a bootstrappable easy way to get to a hundred K a month in revenue, right? Like You get ten clients. Paying you ten K a month.

It is not hard to get ten customers to pay you ten K a month. When it's um a part of their business that's already gonna produce Like already producing hundreds of thousands of if not millions of dollars of revenue and you're gonna provide You know, m the turnkey service. So do you take it off you take the headache off their plate, but you do it better than they're doing it because you're you get seen as a thought leader by putting out like

ten of these case studies. And this happens all the time with At agencies. Um email agencies, conversion rate uh optimization agencies. But you could do this with anything. You could do this with site speed. You could do this with like Uh any number of things. I would just go and you could start with zero start at zero and become a

quote unquote thought leader expert. just by publishing like very simple before and after like kind of case studies. Um, and you start by not even having a client. You say, Hey, if I was this brand, here's what I would do. Look. When they do this, it sucks. Uh, you know, they this is a dead end for them, or you know, they should steal this good idea from this other company. And so you could put together case studies without even having clients.

And so to me, this is like the easiest like if you are willing to work hard. And you feel stuck in a job that maybe pays you a hundred K a year, and you're looking, how do I go from a hundred K to nine hundred K? How do I go from a hundred K to to you know seven hundred fifty K a year? This is the like All all it takes is hustle. uh approach to to that side of type of business. And then those businesses can be sold. So like your job you can't be you you can't sell your job.

Right, like If I write a book, I might write that. That might be the title. You can't sell your job. Just like my my one line case for why you should start a business instead of have a job. And If you get a business like this to Nine hundred K and you know, sixty percent profit.

You could sell that agency or that consulting business For Maybe two or three times, you know, even uh and so you could sell that, you could make six hundred to eight hundred K a year and then sell it for two or three million Um

you know, after a couple of years. And so that's a very easy pathway to financial freedom. Easy meeting. It's simple, not Not that it's no effort, but e easy that like anybody can do it and it doesn't take being the genius with the one idea who beats all the competitors in the space.

Yeah, I totally agree with that. I think there's a bunch of other examples in my head, like um just setting up a Facebook Pixel. And doing it in a way that's actually optimized. um and perfect and following all the Facebook guidelines. I think that's super hard. And I think there should be some guy who's like I'm the expert at this. Right. Um, and I take care of that for you. And uh I I gave a brand of e commerce, but like you can also do this for just, hey, every l legal practice, every dentist, you need websites. I make websites for dentists, right? So it doesn't even need to be

Like You're the best at doing growth for D to C brands. It could be like, Hey In Minneapolis, Minnesota. I make

The best websites for restaurants in Minneapolis, Minnesota, or legal practices, whatever. And just through cold email Or, you know, some companies with hold email LinkedIn referrals, you can like get ten customers to pay 10 K a month. Yeah, I think you could pick any of these um big sectors of the economy like accounting, law. medicine.

Dental. Um be anything senior living. Yeah. Yeah, and I'm just gonna go and build a online thing that um makes their life easier through marketing to them, making it easy to make a website.

Uh It's insane how many of those old world businesses are still like Don't have a good website. Right. Don't do any Google ads. Um stuff like our friend Nick Huber does his thing where he's like he basically has a playbook to make a self-storage unit run better. And so his thing is like I'll buy it at Some multiple, but I know I can run it.

at thirty percent more efficiently or forty percent more efficiently. So I'm getting value. I know within nine months I have a turnkey process. To make this thing generate thirty or forty percent more. And so he does that buying the properties, but you can also just take that playbook and say, Hey Self-storage owner. I will do this for you. I'll do it risk free for you.

Manning, you pay me nothing unless I deliver this outcome. If I increase your revenue by thirty percent or your your your net profit by thirty percent. That would be you know, that would be great, right? And here's my playbook. I do these three things. You would agree that you're not doing those three things today very well, right? Okay, fantastic. How about I deliver those to you risk free? And when I do, I get to keep You know, half the value for the first year and then it drops down to ten percent after that.

And you could do this for senior living, you could do this for self storage, you could do this for any business that's like out there. Once you find a good Like whatever best practices. This is what Alex Hermozie did with his gym launch thing. He's like, Hey gym owner, you want More customers? Like He used to own his own gym. developed best practices and then realized the the value was not in his gym being run with best practices, but taking the best practice and selling it to all gym owners.

And so that's what he that's what he did. And I think You could do that with like pretty much any Any niche business. What do you think about niche content creators and kind of trying to build the same thing by creating content in a specific niche like um You know, eco friendly sustainable product.

So what would somebody do there? So I'm a I'm a content creator, what am I doing there in the in this example? Um making YouTube videos, Instagram video Instagram reels and TikToks about um that content. To business owners as like hey, business owner here's what you should do, or to No, not to business owners, to consumers, just being like this is how I live a sustainable lifestyle. Um, kinda pick anything that you're passionate about and make a bunch of YouTube videos about it or content about it. And I think that can be a big business. Like, you know. Doug DeMiro with cars that um See, I I don't like those as much because I A, I think it's a good thing to do because good things come of it. I don't think they're

very reliable at creating successful businesses. Most content creators don't make successful businesses, right? So if you just look empirically at the numbers, you're just like, okay Of the two million twitch streamers and of the Ten million YouTubers like Who's making over ten K a year? And the number's like astronomically small.

Um, and so you know, the problem with those is that everybody wants to do that and there's not a clear way to like get the value out. Um it is good to do because you will learn, you'll become good at content, you'll meet cool people, it'll lead you to the thing, most likely. But it's not usually directly the thing. Um when it's consumer facing. If it's business facing, I think it's pretty easy then to say, Oh yeah I market to the owners of self-storage units. I create the best content for them. You know, you could go that that's what Nick Sharma did, right? Nick Sharma's like, hey

I'm gonna write the best newsletter. For a e commerce Store owner. And I'm just gonna put together awesome information case studies, deals, whatever for them. And like

That's not for the consumer, it's for the business owner. And he cr created, you know, what w what should be like a five to ten million dollar a year business when it's fully mature. Um Doing just that. And I think you could do that for Basically the owner of any business, construction businesses You know, whatever.

Any doctors, lawyers, whoever. Any any type of business, if you if you focus on that and you you get good at doing that. So I think that one I like. I don't like the consumer facing one as much'cause I think The numbers would show that they don't Make Very much money.

The way that they currently do them. And like, you know, I I have this problem too where it's like Um What's the most competitive thing is like being like a content creator. What what are most people doing from like, you know

Even like a twelve year old can do it. And I have this problem myself, where I'm like, Oh, I want to create a bunch of YouTube content and then I'm like Man. Just you know, I'm competing with Every fifteen year old in America. And

They're better and faster and have more time and have nothing to lose and are willing to do way crazier stuff like Wow, that this might be the wrong game to compete in. And I you know, I'm still trying to square that for myself, like Is this the right game or the wrong game to even compete in? Um, I could have said that about podcasts in general too, right? So like, you know, some of the best things I've done have been like in that category and it worked out.

Just fine. Um, but it does feel a little strange. It's like against my own business advice to like Don't compete in the thing that everybody is trying to do because most likely you know you just Playing game on the game on hard mode. Yeah, the way I've seen it done well is like, um there's this guy who's a realtor in LA and um

Yeah, small time realtor and he started making these YouTube videos that were walking through mansions. Yeah, he's great. Uh yeah, and so he just like made ten of them and were li was like this is fun and then he got access to more and more uh places and just made really high end Video walk throughs of LA mansions. And you know, his job was already to be a realtor, so he was doing this as a way to get new clients in LA. And then um

As he did mo it more and more It became a business of its own, and he stopped being a realtor and now We'll fly around the world. Uh, because people will be like, I'm trying to sell this house. Make a video of it.

And he'll go make a video and a million people will watch it in three days, cause he's got so many YouTube subscribers. So I think where you're combining it with like a profession that you already have. It probably is a good fit. Like there's some guy who's um SMB acquisition attorney on uh Twitter. And so it's just a great way for him to get gen, um

Yeah, new customers. Well, I also think like um I don't know if this is a good thing or bad thing, but it's that is that Thirties age thing where it's like I used to think about a business and only look up Like wow, the skyscrapers are huge in this field. I'm I too am gonna build a skyscraper.

And now I'm like, cool, before I do that, let me just go quickly look at the graveyard of people who have tried to do this. And like when I was in my twenties, there was no graveyard I didn't think about the graveyard. I'm like music startup. Love it. Everybody loves music. Right? Like what could go wrong? Yeah. And then when you're in your thirties, you're like, don't touch me. Yeah, I did social networks for like seven years or six years uh of my twenties because it was like the skyscraper was so attractive. And like There is some beauty of just doing the not even paying attention to the graveyard. Like I think The people who win will just do that and it'll work. And their success formula was like, Yeah, I didn't worry about the graveyard. Why would I do that?

Um But As I got older, I was like, man, you know what's more fun than Try to build a social network, like winning is really fun. And so like let me just make sure that whatever I'm doing, like The odds are not like

Ninety nine point nine percent chance of failure. Um like that that's become and if I'm gonna do it, okay, I'll go in eyes wide open. I'm gonna look at the graveyard and say, I'm still gonna do this. That's kinda what happened with the podcast. It's like you know what, I'm still gonna do this, even though I know that most podcasts nobody ever listens to. Um Whereas before I did not even pay attention to that and I didn't, you know. But I don't know if that's a net positive. It might be a net negative, actually, in terms of like How uh

You know the the the The strength of that kind of like the ignorance. Yeah, there's this guy, Bobby Kodak, who's the CEO of Activision, and um He's like I can be CO of anything. I could be CEO of a toilet company or C of Campbell Soup. The thing that matters to him is success and momentum.

And you know, there's so many people who are like, You're the CEO of a games company. That's all what I my entire life would be made if I could just be that. And he's just like, success is what matters more than Anything else and I'm kinda closer to that as I've uh gotten older where I'm like

Um Success is the thing that brings me joy more than the specific category or product that I work on. The thing that I think you've done Um Really well, Sean is

You've seen friends who will have a successful business and you're like, let me just clone this business in a different category. Like, you know, you did that with Sam and um the hustle with Milk Road. And then uh you saw an e commerce business with Ramon and the way that he was doing it. And you're like, I could do this too. Um So I think that's a really good way to to do it. That's like kind of underrated. Uh and most people don't do where

They're like, I see this person as successful. Um I'm just gonna do the exact same playbook, but in a different product category or different sector. Yeah, I call it having a blueprint. Like If I don't see that there is a blueprint of success in a category

And that it is replicatable, like okay, I can look at how the guy started Snapchat, but if But that doesn't seem very like re yeah, I can't replicate that. And so but when I saw in e commerce or I saw oh the newsletter business, I thought, okay Not saying this is easy. But I like I understand this. This is simple enough for my dumb brain to get

How a business like this works. What is the cost? What is the where does the revenue come from? Where does the growth come from? Got it. Um, did they have some unfair advantage? Did they w did they start at the right time and that there's now is like, you know, not the right time or whatever. I try to just figure that out. But if there's a And so now with new things, I just look for that like first We're gonna go searching for a blueprint. I'm gonna talk to people until I find a blueprint. Like, okay, I wanna

Uh by companies. Cool. Andrew Wilkinson is a good blueprint. What does he do? How does it work? And then do I wanna like do I believe that I could replicate that in my own way, in my own sector or my own style. Um And if I don't see a blueprint, I don't really get that excited at this point because I'm like

Why would I do it without a blueprint when I can do it with per personally, I'm like that. Or the same thing. If I'm gonna do it without a blueprint, All right, that's cool, but I'm gonna make the announcement, hey, I'm choosing to do this without the blueprint. And I gotta go in eyes wide open on that. So like all all of my rules I break all the time. But I say them and I do them because I'm like I'm cool violating this rule, but I just I'm not gonna do it subconsciously. I'm not gonna do it blindly. I'm gonna do it knowingly.

And I'm gonna make that trade. You know, knowing exactly what I'm trading off by making this decision. versus uh you know the the how I you know used to do it where I didn't really understand I didn't even know what I was looking for. Um you know when it when it came to that. I wanna finish with some rapid fire. Can I do some some quick ones? And then I just want you to say your reaction to this. Okay. So I'm gonna say this first category is

Things you've told me that I thought were funny and I want you to just like react or elaborate. Sort of like explain this tweet. Um I don't know what the hell mental models are. I used to think I was dumb for not knowing what mental models are. Now I think everybody else is dumb for thinking about mental models. Some version of that. Yeah, that's right. Um in Silicon Valley it's so in vogue to be like, Oh, I'm applying the you know, this cognitive bias theorem to the situation.

Um And You know, everyone in Silicon Valley that's smart talks like that. And so I was just like, Why do I when I see something, I don't see it in that same way. And I just thought I was an idiot. Um

And I always solve a problem like from scratch, like tabla rasa, like it's the first time I've seen it. And I just like that way of doing it. So I gave up trying to find mental models. Um all right, another one. You started your first two businesses on what I'll call wave. So like the Facebook app app platform I think launched the same day you like I've quit your job and we're like, what can I do next? Let me just do this.

Um, you saw the announcement, you're like, I'll just do that. I have nothing to lose. Um, same thing with the mobile app store launch. I think you were one of the first big iPhone games. Um What are the waves today? What would twenty two year old Sully be doing now? Uh probably something in genetics or um AI

Uh Yeah, probably one of those two things. It's the biggest sectors. Okay. What um You uh seven years ago we were at dinner and I was just asked you a question. I was like, Why haven't you like, I wanna build like a big company or build another company and I was like, Why haven't you done that already?

Uh you're so smart. You're so great. Why like what's what's gone wrong? And you said to me. I don't think I understood what a billion dollar company was. Before. What did that mean?

Uh I think you need to have a certain moat and uh There's a bunch of things you need to get right to build a billion dollar company. You need to have a big market. You have a clear way of getting customers that um makes economic sense. Oh. And you need um A product that's really good.

Uh So I even today I feel like I've got a very clear path to be able to build, you know, a hundred, two hundred million dollar businesses. But I haven't quite figured out how to build a billion dollar business. Outside of taking

Uh five Or ten hundred, two hundred million dollar businesses. I think there's a different code to build a billion dollar business than A hundred million dollar one. Excellent. Uh what would you do if you were Mr. Beast?

I would start a Y combinator for creators. and um maximize the uh basically find uh the next Kim Kardashian, the next Mr Beast. and uh support them and own a piece of them and

be a king maker where I'm making other kings. Um You S did a lot of startup investing. I think you've pulled back some from startup investing. Gimme the uh

the the bullet point version of your take on startup investing. Um, I think start up investing Uh I I think competing for deals sucks. I hate trying I find it very demeaning trying to convince somebody to let me invest fifty thousand dollars in their round. Uh

Friend of mine was raising money and got a term sheet from Andreessen Horowitz and Bill Gurley at Benchmark. and went with the Andreessen Horowitz term sheet. And Bill Gurley was so mad that Um he called the founder up and like yelled at them for two hours. And sent them fifteen angry emails.

And uh Bill Gurley is one of the most successful people in the industry. And the fact that he still has to do that made me be like, This is a industry with no moat. I don't want to like Have to go um kind of beg or try to twist people's arms to let me invest in their startup.

Um The other thing that's happened is Trying to turn um fifty thousand dollar investments into two million dollars. Over a ten year period.

um doesn't really do anything for me anymore. So my first startup investment ever was a hundred K investment in a company called Chart Boost in twenty eleven or twenty twelve. And then the company sold in twenty twenty one and I made two million dollars. So th that was a ten year time span. Um So I I think having to wait ten years to get

Uh cash out is really annoying and makes me like it a lot less. I think the valuations have also gone really crazy. Um And

companies are so much more competitive, like uh There's a company called Divi Home. that raised at a billion dollar valuation and there's four other Divi homes out there. um that are competitors to it. Uh so the combination of high valuations and increased competition makes it really hard to make any money as an investor.

And I've evolved from being um interested in kind of making these fifty K checks into trying to buy a majority interest or a thirty forty percent interest in businesses that have revenue and uh profit or a path to profit. I think that's a better way to invest for me because

I'll see money back and be able to take that money and reinvest it in other new businesses. What's the biggest Investment. Miss You've had and biggest hit you've had.

Um biggest miss was uh Coinbase. My uh at Tiny Co we had this guy who worked for me named Adam Merber. He was roommates with Fred, the um Coinbase co founder. And so Brian, Armstrong and Fred um were

fundraising for their series A. They got a term sheet from Andreessen Horowitz and um Benchmark and a bunch of other firms. And so they called me and said, Hey, should we go with benchmarks? Should we go with Andreessen Horowitz? Uh, you know, we've at Tiny Co raised money from Andreessen Horowitz, Mark Andreessen was on the board. And uh

I was like, go with Andreessen Horowitz, here's what's awesome about them. And um On that call, if I was like, Hey, by the way, can I put in twenty five K into this round? Uh I feel like they would have said yes. And that twenty five K at their IP was

Worth Two hundred million dollars. Ha ha ha I think it's probably or you didn't ask because you didn't think about it. I didn't ask because I didn't believe actually honest answer. Yeah. Crypto, Bitcoin

These guys are building PayPal for crypto and Bitcoin. That's silly. That's just PayPal. Um what about biggest hit. Biggest hit. Well, let me ask you. You you wrote something on here. You said could have invest in Facebook stock. I thought you I read something that you had bought After you sold your company that was on the Facebook app platform, you had bought Facebook secondary shares. Did you do that or or am I missing that?

Um, I did this really stupid thing, uh that I'm still embarrassed of to this day, which is I Uh signed a contract to buy some Facebook stock, like a hundred and fifty thousand dollars worth. And um The stock price. You know, it was private, but in the private market the price went down by fifty percent.

And I called my father and was like, Oh, you know, if this happened to me And he was like, Don't worry about it, just buy it. And um You'll be fine. It'll go back up.

And uh instead I didn't buy it. Um They su I think they might have sued me and said, Hey, you signed a contract to buy this. And then I said, Okay, fine, I did. And I paid them uh seventy five thousand dollars to not buy it. Versus a hundred members of mine?

Yeah, yeah, I was a hundred fifty I could buy it. So I s paid them seventy five K to not buy it. And I was gonna go buy Um Some from somebody else who was selling it. And um

They backed out, so I didn't end up buying it. And then while I was uh buying it from the other guy, somebody else came to me and was like, Hey, um I've got Facebook stock to sell too. And so I hooked up a friend of mine with that Facebook stock and he bought fifty K worth of stock. And that fifty K ended up being worth like eight million dollars. Uh for him, which is kind of amazing.

Um And uh I was actually raising a fund to be like, we're just gonna buy Facebook stuff. Yeah,'cause th th that's what I read. I w after we had very first met, I was like, Who is this guy? And I googled you and I saw some article where you had sold Your app on the f the your Facebook app. And you were like, it was like, what are you gonna do now? And you're like, actually, I think Facebook is the good investment, not like my app. And you're like, I'm gonna just buy like

millions of dollars of Facebook stock if I can. Um and I was like, Wow, this guy's super aggressive and interesting. Like I what a great In hindsight, well, I this was now many years later, so I was like, you know, wow, that must have turned out amazing. I didn't and I never asked you about it. I never knew the stuff story. Yeah, this was in two thousand eight, during the great financial crisis. So everyone was running away from everything and Facebook was valued at two billion dollars in the private market at the time. Um

And you know, hadn't I PO'd and was unclear when it would IPO. Um was uh you know, s probably at a c a hundred or two hundred million MAUs, something along those lines. Um And actually I met this guy who's uh in New York City

And was like, Hey, I'm trying to buy this stock. And he's like, That's a brilliant idea. And I was like, Yeah, I'm trying to ma uh, you know, get the best price possible. And he's like You idiot. Don't worry about what price you're getting. Just buy at from everyone who's selling it. Go buy it. Um because this price is so cheap that it doesn't matter matter. Don't worry about whether it's two billion or three billion or four billion. Just go buy a buy it all. And uh

I just kinda fucked it up. Yeah. Easier said than done for sure. When those moments happen. Uh it's happening right now in crypto. It's like I know so many people that were like uh I missed it. I wish I got in, blah, blah, blah. As it was going up. Crashes back down to, you know, eats at a thousand, Bitcoin was at sixteen thousand, you know, like a month ago. And it's like, Hey, you know, if you did want to buy, like Now would be a pretty good time to buy, probably. And they're like oh man, this thing is

Uh who knows now. And they're the same people that three years from now are gonna be like I wish I had bought again and they're still they're just never gonna buy. They're just gonna constantly spit on the side and wish that they were buying. And never buy at the times they should, and always wish they could buy at the times they shouldn't. That's me right now,'cause I've got like Forty million dollars or fifty million dollars in UST bills. That like mature every thirty days.

And um I'm keeping them on in like short term T bills because I'm like, I'm gonna find some other investment, whether that's the S P five hundred or something else. There will be other investments, and now is the time to go buy them. Um The a couple months ago the S P five hundred was at like thirty six hundred. And that was my trigger to go buy it. And I was like ah, it's gonna go to thirty five hundred. I'm gonna wait till thirty five hundred.

It never hit thirty five hundred. I am still sitting on those T bills, did not buy. S P five hundred. Yeah, very, very hard to do this sort of thing. But like uh maybe this is where the mental model works. The cognitive bias or the w whatever whatever bias this is, I got it. Uh you know, there's someone out there who knows all these biases and they they're right. I have all of them. Actually my father is really good at this in um you know, I sold my first startup and made a million bucks in two thousand eight. Um he lived in Florida and was like all the st uh real estate prices here are at twenty five cents on the dollar. I'm gonna go buy it. And so he bought a house. I I sent him the million dollars. He went and bought a house for 150,000.

Two weeks later that same house was selling for seventy five thousand dollars. If it was me, I this is literally what I did. I would have freaked out and said, Fuck, I don't know what I'm doing. I'm gonna stop. This is not working. Instead he bought another house for seventy five thousand dollars. And he just kept buying houses, um

Like for the next two years, uh, all the way on the way down as the stock market as the real estate prices um We bottomed out, kept going down. And then even on the way back up, as they were increasing, he would just keep buying them. And so as a result, he owns or we've a family now owns something like a hundred Uh you know, single family rentals in Florida. And what's the line there between degenerate gambler, because I've done that too when I'm losing money and playing poker or blackjack or whatever. What's the line degenerate gambler and genius? Maybe there is no line. Maybe it's how the result turns out.

Yeah, I think it's the result, but also it's the psychology going in where you're like I know this is gonna go down. I don't care because I I know I can wait five years or ten years and this will go back up. Right. And he was like, This is below replacement cost. So If you were to build a new home right next door that was the same home, it cost you more it would cost you four times as much as I'm paying for it right now. So Yeah, amazing.

Our software's the worst. Have you heard of HubSpot? See most CRMs are a cobbled together mess, but HubSpot is easy to adopt and actually looks gorgeous. I think I love our new CRM. Our software's the best. HubSpot, grow better. You have a very honest LinkedIn. And I saw a guy who I think one ups here and he I actually want to tell you about this business in a second. So amazing. So Google this guy. Justin Yoshimura.

So Justin and then Yoshi M U R A. So I'm gonna read you this guy's LinkedIn. He goes, I'm currently the founder, uh founder, chairman, and CEO of CSC Holdings, one of the dime a dozen. quote unquote unicorn startups. Wow. Unicorn startups dime a dozen. I'm trying I've been trying for fifteen years to make a unicorn. He's like these are dime a dozen. And then he goes After being told that nobody would ever hire me, I quit the bureaucracy and the negative negativity of Palos Verdes high school. So already just like holding a grudge against his high school. To start a marketplace for unlocked cell phones. Anybody who sells cell phones, ring tones, or any of that shit, they're like the best. They're great hustlers. So already, you know, bonus points. So he's got two points. First, making fun of s the fact that he owns he's a CEO of a unicorn. Second

High school dropped out of high school and sold unlocked cell phones. He goes, which was acquired by Family Office when I was nineteen years old. More recently I started five hundred friends, a marketing loyalty thing. We merge with whoever and eventually acquired by whatever. Then he goes. I angela's fifty K to one million in interesting companies run by interesting people. Then he names a bunch. When he names the companies, he names the round he invested in. Another key another key thing that o only real investors and honest people do.

Um, which is that they you know Yeah, I invest in Monks in the seed round. I invest in this one late stage, right? Versus what most people do is They'll go by, you know Airbnb shares in the public market and call themselves an investor in Airbnb, right? It's like we know we know what you're doing here. I've seen big venture funds do that too, where they're like, Oh, this is a hot company. We wanna invest in the secondary in the series D a couple of million bucks just to be able to put on our website. Small amount at any valuation, don't care, I'm just buying a logo, basically. Yeah.

Um So then he goes Besides uh besides business and things I shouldn't be discussing on LinkedIn, I love animals, dogs, many cats, especially Persian Himalayans, dolphins, whales, he names like ten animals. Manatees, turtles, then he goes, Despite this, I'm not a vegetarian, bas mainly because I lack self discipline. However, I do want to clarify I don't eat any of the animals above, and I would judge you for doing so, especially considering that the prevalent belief is that eating wild animals at wetmarks is what caused COVID. Oh my god. Where's the Sleeped Informile going? And then he goes, I've been included in many vanity lists such as Forbes 30 to 30, Inc. 500. Whatever. Yeah, f forty under forty. But thankfully I stopped advertising these on my LinkedIn headline when I was nineteen after realized I was being a douchebag. For for a formal bio, go to my Wikipedia. So

First, just a deep breath to digest this guy. Do you know have you ever heard of this company, CSC Generation? It's it's pretty interesting. So what he did was He started buying up All these like kind of antiquated

furniture companies. So it's just It's this kind of hush hush thing, but they own Z Gallery, which like half my house is like from Z Gallery. Um he owns uh what are the other ones here? One Kings Lane. He lo he owns Surla. Uh La tabla

So he's bought like Soros Alba for eighty nine million, Zeke Alley for twenty million, one Kings Lane, and then he started making offers to buy I heard about him because Um, my our buddy, I don't know if you know Metab, but Metab uh sent me this link. He goes, This gotta be great for the pod. And Metab's like hundred percent signal to noise ratio. If he sends me something, a book, I instantly buy it. So this was like instantly just put it on the list, do research on this guy. So this guy's thirty two years old.

He's built basically like a sort of like a billionish let's call it dollar company rolling these up and what he's doing is he's making them more like e commerce and digitally like savvy. Uh so he'll close down.

half of the retail locations that aren't performing, he'll get the e-commerce side to build up. He'll take all the customer data that they have and he's like, dude, they They have like years of customer purchasing data, but it's in a machine that's like twenty years old. that they can't even like literally extract and like put into an email database or like find a you know put put it into Facebook ads or anything like that.

So he's like we take this d he's like we build a system to buy these companies. And he's trying to build Like what Constellation Software did for small SaaS companies. He's trying to do that for large furniture companies. He's like He's like, that's my model. They built a amazing intake engine to buy like thirty some thirty software companies a year and like unlock more value from them.

I'm trying to do the same with furniture companies. And this guy gives like no interviews. Um he's just this one guy. And the reason he's on people's radar now is because he started making these wild public offers at these old school Furniture companies. So he went to them privately.

He's like, I'd like to buy your company and they're like You know, they're in Nebraska, they're sixty five years old, they're like, you know, my father's father built this table in this furniture store. Like what are you talking about? And he's like here's this thirty two year old kid who lives in LA And they're like, No, we don't we don't want your kind here, basically. So they don't like his offer. So he's like, Okay, this is getting me nowhere. So he just started releasing press releases saying, I'd like to buy this company.

for twenty or thirty percent over the public, you know, share price right now. Please respond, board. Uh you have not been productive. You have not responded to my offer in private. You've not told me a counter offer. You've said neither yes nor no. Your shareholders deserve this. Um publicly so he's publicly making offers on these two public companies and that's how he's like

Now on people's radar because he was like pretty much doing this under the radar before this. What do you think of this uh this guy, this idea? That's genius. Uh I love it because there's just so much unlocked value in these businesses. And he's focused on a specific Vertical furniture. I have no idea why he's focused on that vertical.

But just that kind of focus will allow him to be able to um take the same product, sell it across a lot of these different retailers. get cravements in margin by combining the scale of all of these. And the idea of doing it Going after publicly traded companies that are

Like undervalued. So good. And so he he said so they're doing uh they're doing over a little over a billion in revenue now out of their thing. And he said he's targeting furniture because They're undervalued. They lag um They're like kinda like l uh they're sort of like lagging in the they they who can benefit the most from like a digital glow up? He's like it's these companies that are like basically not participating

in the right way in like the digital world and the economy and e commerce and and whatnot. And so um he goes, A lot of these old school furniture companies have a ton of customer data. It's an old s physical server in their warehouse. Software's thirty, forty years old. The company that made the software is out of business, you can't even like get them to update it. He goes. Um I'm just trying to get it to be modern. We've built a platform and a process to unlock the value of this customer data.

I'm always a little c uh a little uh skeptical of that c type of claim, but Um He goes, I have I have no desire to have my own brand. Um he goes, Constellation software has no brand. They're just a forty billion dollar company that goes thirty three percent a year. Ten years ago the stock price is a hundred, now it's two thousand. They created a platform to buy these companies and unlock the value and tuck them in.

They have the infrastructure, people, and process. They've created a machine to unlock value in this category. I don't think anybody's done that in retail. Uh that's what we want to become. Wow. Uh First of all, I just love the tone with which he speaks and like the humility and is just kinda like this is what we're doing. It's simple, there's no magic to it. Um, it's obvious. In fact, why isn't somebody else doing this? Okay, nobody else's, we'll do it.

And that's kind of amazing. So I bring this up for two reasons. One, on the tone, uh he reminds me of you, your LinkedIn is the same way where you'll be like, I invest in this company. Kinda got it was kind of like a Yelp for this ish. I don't know. I these guys can explain it better. And like no no investor would write that on there, or you'd be like, I kinda got acquired acquire ish, I don't know. Good outcome for the guys, you know, okay for me. Um you're you're very honest with like your portfolio, which I thought was Good and and unique. Nobody writes on LinkedIn like that. LinkedIn is basically like, you know

It's like those dog shows. It's not like owning a dog. It's like those dog shows. If you watched a dog show, you'd be like Is this what owning a dog is like? And like No That's nothing like what owning a dog is like. Um so I like I thought you liked that. You also when I started my e com biz, you sent me a one line email. I don't know if you remember this, you go You go with my last business.

We realized that we just have to do this one thing differently than everybody than like the current status quo, and it would work. We didn't need magic. It didn't need like ten genius. Things. We just needed we just had this one fundamental thing. What's the one thing you're gonna do that's gonna make this work? Um and like, you know, that one question I was like spinning for like a week because I was like I don't know I don't have a good answer to this question. Does this mean my business is gonna fail? Uh but this is a great question. And I stashed it in my great questions list. I thought, okay I need to find that for this business, but also for every business going forward. What is the one thing that needs to be true or like, you know, is true about this?

Uh do you remember sending me that? No, not at all. But I think uh that sounds like the sort of thing I would do. It for some reason it reminds me of um My first company I started Uh

I started with a a friend of mine from college, um And we sold the company and after we sold the company we got into a fight. And uh He sent me this email that was like Fifty reasons this company succeeded despite your existence.

And I was like ouch. And so I went and read it and uh you know he got to like twenty five good reasons and then uh twenty six he was like you get the gist. And for a little while I read that email um like every day. For like the first year that I got it. And then after that I read it um like kind of once a year, every year, to just be like, what is it that he said and what was the truth to it? Um

I don't know why it reminds me of that, but uh That was such a great Um great. Great email. There was some truth to it enough where I could kind of be like cool, let me just take this feedback and action it in the future.

Um And Is Also ironic in that um You know, he

Uh He didn't he kinda gave up the startup game kinda shortly after that. Man, you really broke him. As a partner. Well he actually tried to do a couple other startups and then I think um and I think got into Y C and did a Y C funded startup. Um But I think it's you know, the start off game is a hard game.

And so he was just like, This this game isn't for me after some number of years. Um And the other thing that's crazy actually is uh so you know, I started that company, then I started Tiny Co and we were raising our Series A from Andreessen Horowitz. And he found out and um He sent them an email saying you shouldn't let this guy uh you shouldn't invest in this guy call call me.

And so they called him and you know, he was like Basically read that list of fifty things. And uh You know, it almost killed the killed the deal'cause they were like, Yeah, we're we're worried about investing in this deal because of this. Um

And uh Only because there's so many things that um People uh Th there's so many things that people will like admonish privately but br uh but kind of celebrate publicly like

Travis, the Uber CEO when he heard that some company some V C fund was investing in lift. He stopped what he was doing, he drove down to that V C firm and said Here are all the reasons you shouldn't invest in lift. Right. And that seems crazy, uh, but because he was successful, brilliant.

And uh there were a couple other things with like Mark Pincus and Zinga where he did the same thing. So um it was just a funny experience going through that with him. And the kind of Drees and Horowitz series A. And uh it's funny now because somehow uh ten years later we're uh great friends again. And uh you know, he got married and I was like the best man at his wedding. All right, happy ending to this. You um you also have been talking about this kind of like buy a public company thing. So I cause I'm I'm like, yo, what's next for you? What do you what's the next big swing? What are you excited to do?

And uh you've talked about this, so let's let's go into some of those I that idea. Cause I don't think most people in the startup game Think or talk about it. going and buying a public company or or you know, sort of a hostile takeover or what what have you. Uh What's the idea here and why might you do it?

Mm-hmm. Um yeah, so I've been kinda Trying to figure out what to do next. I think after Tiny Co, I was like, Wow, startups are hard. I'm gonna try to take it easy. And uh

now gotten to a place where I'm like, cool, let's do something big again. Um And starting a new company from scratch is really hard. So I've just been like Is there a public company that I can acquire Um

where I don't go through that zero to one phase that everybody loves but is really difficult and go to a place where Something's already at a five or a ten. And uh can I then take that and scale it as an as a way of uh kind of running a business. Um

So to me, the perfect business out there to acquire is this company that was that's this is number one on my list. is a company that was a three billion dollar That's currently a three billion dollar company. But in the private market was ten billion dollars. So it was worth ten billion dollars before and now as a public company it's worth three billion dollars.

Uh the company is Squarespace. We should read a Squarespace ad. I feel like every the only time I ever hear Squarespace Squarespace is in their ads now. Yeah, Squarespace spends uh so much money on these like podcast ads. And uh you hear about them everywhere on podcasts or um Places that you wouldn't really

You don't see companies doing like direct response advertising. Like I never see them on Facebook, but I always hear about them on podcasts, which I think is super weird. And so the stock is down, you know, fifty percent since the IPO They're at this like kind of nine hundred million revenue run rate now. Uh, it's a subscription business with more than four million subscribers.

Um I'd love to buy it'cause I think it's a great company that's super undervalued. Uh, it's not being run to maximize profits. So it's being run in a way that um Keeps it at break even.

So I think you could run it to maximize profits, get rid of those podcast ads. Focus on direct response, uh, Facebook ads to get new customers. Where's the fat in their in their spending? They do a ton of like uh Mm-hmm.

D non direct response ads that are like T V ads or podcast ads. that I think are great to have this like halo effect around the brand. But I don't think those are the optimal way to maximize return on ad spend. Right. And so they do, I think, three hundred or four hundred million of marketing spend. So that's one. You could make that more efficient or cut that down. Where w what is the the other is it like

Like you know, like Elon buys Twitter, he fires half the staff type of thing. There's like a huge headcount. Or what else is like uh fat in their system. Yeah, I think they've got a a ton more people than they need. Um their headcount costs are like two hundred and twenty five million a year. And their headquarters in is in New York City. And I think you could just

cut that team materially And um you know, get rid of the New York City headquarters'cause it's super expensive to be there. Yeah, Sam was talking about I remember back in the day, like uh one of the earliest podcasts talk about Casper. And he's like, Casper you know how I knew Casper was gonna fail? They had like

A hundred and fifty employees in New York. And it's like why are you why are you hiring all these people in New York? You don't need these people should be sitting in like, you know, South Carolina, Omaha, and like you know, these other places. Like why is your customer support You know, somebody making, you know, all this money in in New York. He's like, That's the first thing you gotta do is just get rid of New York. And he was like so adamant about it. That was like his number one rant. And this is at a time when Casper was still like seen as like kind of like one of the like rising stars. Like now I think Casper just kinda taking a beating in the in the market and all that stuff. Um I think it might have gone private again.

Um because it's private. But uh But I remember that was his like number one thing. It's like I say no more. I don't need to read the PL. Uh I just saw how many employees work in New York. I could tell you this business is mismanaged from day one. There's this great Carl Icon story where he buys a business uh that makes like um subway cars. And uh they've got a huge team in New York. and a team somewhere in in Middle America and he goes the team in New York and is like There's three floors of them and some fancy midtown building and he's like, So what do you guys do?

And uh you know, they show him all these presentations for two days. And he's like, Okay, I saw the presentation, so what do you guys do? And they're like, We just told you. And so there he's like all right, let me go visit the guy who runs the middle America thing that actually makes the railroad cars. And so he goes to visit them. And he hangs out with a guy, and the guy's super charming.

And at the end of the day he's like So uh you know, there are these guys in New York, what do they do for you? Uh, do you need them? And he's like, No, those guys don't do anything. In fact, I got four guys that are just there to manage those guys and all the questions that they bother us with. Firewall Yeah.

If you get rid of those guys, I uh Think if the business will continue to grow and Uh will be fine. And so the next day he goes back to New York and fires three floors of people. It's like that scene in Enterage where Ari Gold just walks in with the paintball gun and just starts blasting everybody. That's basically like the uh the the New York uh the New York firing by Carl icon.

Yeah, he tells the story with such a smile and um actually he tells it as like This was pretty early in my career, uh, so it took me like a couple of months to do this. If it was now, I would buy the company and fire them like the next week. And so how would how does somebody actually do this? How do you go buy a three billion dollar company? Because you're rich, but you're not three billion dollars to spend on a company rich. So How does somebody do this? Yeah, um I think three billion uh the three billion dollar thing is probably too much for my uh you know personal balance sheet.

But the way you would go aro about it is just like the guy at CSC generation is doing, which is um make a public offer. It's the same way Elon Musk did it. Uh you first make a private offer. Then you make a public offer. You um make sure that all your financing is lined up when you do the public offer.

And you know, the way that US stock market works and um shareholder rights laws work is uh board has to respond to that offer And they have to have a really good reason to not take it if it's if it's at a material premium to the current stock price. Um otherwise they're gonna get sued out the wazoo by shareholders. Right.

Um And so yeah, that's kinda how you do it. Okay, so that's what that's one way. You um Let's do some of the other things. Let's do so that's from big idea to Fun smaller ideas. So you uh you were telling me something like you helped your buddy

I don't know, high school friend or college friend or something like this sell their dental practice. What uh Tell us teach me about that. I I don't know anything about that. Yeah, uh this was a chance for me to be a deal do la. So this uh friend of mine called me and was like, Hey, I got a quick question for you. Um somebody I I started this dental practice, you know, ten years ago. Somebody um came in to make an offer. Should I take it?

And you know, I thought it was gonna be one phone call, it ended up being like sixty hours of work. with a bunch of phone calls with him and and the buyers of the business. Um And it was super cool to see the inside of a dental practice and how uh the PL looks and how a company gets acquired like that. So he has a dental practice that's

Massively profitable. that he runs in a way where he's optimizing for his lifestyle. So he does seven figures in Ebida. has a fifty percent net margin. All while working.

Three days a week. And uh I was just like oh my God, it worked golfing? What what is he doing the other day? He is making up new hobbies that uh he's getting excited about. Like uh he's never gone fishing before and he's like I got all this time to kill'cause I don't have uh. Yeah. So he'll go find a new hobby and like buy the gear, find somebody in town who uh is good at that hobby and go with them. So actually I I hung out with him um recently and he's like, Let's go fishing. I was like, When did you take up fishing? He's like, I got so much time.

So he works three days a week and uh he's not optimizing the business for Ebida. He has a big waiting list of patients who uh wanna become patients, but he doesn't have the time to see them. He has one dentist that works for him and a bunch of dental hygienists. But none of that is being done in a way where he's like optimizing for revenue or profit, just optimizing for his quality of life. So this private equity firm

Um Is doing a roll up of all of these dentists in that area. And it's super interesting how the um Private equity. So they've got a company that's going around and doing this roll up of of dental practices.

The company is um run has a CEO which is a dentist. Super nice guy. uh super well known in the area and admired by admired and liked by all of the other dentists in the area. So he's kind of like the figurehead of the company. Good cop.

Good cop. Then uh they've got a COO who is this Um, hardened guy who's bought tons of businesses and worked for a bunch of private equity firms and is an experienced acquirer. And you don't even like talking to him after, you know, five minutes. And he's the bad cop.

So good cop and bad cop go in and you know, good cop does all the charming saying this is gonna be a great acquisition, look at how it's turned out for me. Bad cop, um does all of the numbers and negotiating. So they bought this business and uh

They bought it with a really simple premise. They bought it for a seven X IBIT multiple. And they're like, we're gonna go buy all the dentists in this area that we can. And we'll sell it at a fifteen X EBITDA multiple because we'll get to a scale of, you know, twenty, thirty million in Ebida. That's just the valuation arbitrage, right? Which is basically that small EBITDA businesses like let's say you're doing a million or two million, they'll sell for seven X. But if you had

twenty million of even a business, it'll get acquired by a larger institution. It's a easier Buy button to buy. twenty million a a a year if he would uh For Fiftex. That's that's and so all you have to do is kinda like accumulate, roll up and and

put this together to get to that next stage of buyer. Yeah, exactly right. So that's one aspect. And then the other aspect is they were like, There's all these things that we can do to increase revenue for this guy's business. One, we're gonna add another dentist, eliminate the waiting list. Anyone wants to see a dentist, they're gonna be able to see a dentist within a week. They added another dental hygienist chair. So the dental hygienist.

Chair costs like ten thousand dollars. And um My buddy uh just didn't go buy one and uh kind of put a dental hygienist there to increase dental hygiene revenue. Um, they even told him that Uh

There's all these things they can do to maximize to increase the amount of money they get from insurance companies. So they were like There's this one instrument whenever you're doing a cleaning Just pick this instrument up. You don't even have to put it inside the mouth of the patient. Just pick it up for a second and then put it back down.

And then you can claim that this higher insurance code and we're gonna generate more revenue. So he called me and was like, you know, is this moral or Is this Immoral. Like I can I c go back to these guys and say, Hey, I don't want to do this. This doesn't seem right. He said as he's holding the tool up for forty five minutes just to see what happens. That's right. Uh and then because they bought all these other dental practices in the area, they're able to take one dental practice and say, Oh

Um you need braces or you need a root canal or you need whatever uh oral surgery procedure. We're gonna refer you out to somebody. And so they used to he used to refer to people who are just kind of third parties and now He gets to refer to people that are in the network already owned by the private equity firm. Nice.

Yeah, okay, that's great. So you see that machine and you're like, Wow, this is amazing. I What's your kind of like big takeaway from that experience?'Cause I think most people wouldn't take the time to go do that. Uh you did, and I think you probably got something out of it. What what'd you what was your big takeaways? Uh well, I thought it was amazing that it was a win for the private equity firm and just being able to see the roll up strategy and and how good it was for them up front was awesome.

I also got to see it from his perspective. And from his perspective, it was also a huge win. It was an easy transaction. He didn't shop it around. Um it was a way for him to retire and become the richest person that he knows. He owned the real estate of the dental practice, so

He got to keep the real estate. And now the choirer pays him rent every month for the real estate that he owns. And uh Now he gets to go.

'Cause he was working three days a week, which is a lot. He now gets to uh take month long vacations to Europe or Africa or wherever he wants to go for fun with his whole family. Yeah. That's amazing. I also like the ri I'm the richest guy I know. I think that's a a funny thing that actually does happen in a bunch of like especially smaller towns and uh like niche things.

It's like if you can make eight million dollars or something like that, you are You you know, you're done. Like you don't need any more and you you feel like There's a beauty in that like if you're in Silicon Valley, you could build a billion dollar business and like You might not get invited to the big boy table still. Uh right, because it's just like everybody knows fifty people that are more successful, younger, smarter, and uh you know more ambitious than them. And so there's this this never ending

you know, like race that you're on if you're in Silicon Valley, New York, LA And that's just not true in these other places. And I I think there's some There's something great about that. Yeah, it's amazing. The only way to win the rat race is to opt out of the rat race, and uh he has opted out and uh has thereby won the rat race. And it's so funny to compare my life to his'cause Um

I spent so much more time working. And uh You know, have made a bunch of money so that maybe I don't need to work as hard or at all Ah and yet

I continue to work and he's like I'm chillin'. And uh you've thought about that or no? It's like just not your nature. Um I have

One of my goals for twenty twenty three is to like take it a lot easier work wise and spend a lot more time uh doing as many fun things as possible. Like I'm in LA right now. They have this thing called the Porsche Driving Experience. Uh so you go and Go with a bunch of friends. Uh they've got Porsches and a racetrack and you get a Porsche and just drive it around the racetrack as fast as you can without killing yourself. We you know, when we got back from the weekend getaway that we did, I gave a debrief and I talked about this one observation I had, which was that

At that thing there was P we met People or we were hanging out with people that were of like four or five different life phases. So there was like Um You know, uh, you know, Victor and Jude, uh basically like you know, twelve year olds, and their mindset was like, Yo, wake up, it's time to play. Like they literally woke us up.

With a boom box by the window just playing like you know Tiesto or something like that. And they're like, Come on, the pool's already warm. And then we can go to the sauna, then we can play golf, then we can play woofball, we can play this, play that. Like they were just and like from the moment they woke up to the moment they went to sleep, they were like, Let's play. That was like the Yeah, twelve year olds. And then it was like the twenty year olds we've met that came over that night That were basically like building the NFT projects or doing the like TikTok inst the TikTok D to C brand that was just taken off.

And they were like I don't know how to describe it but they were kinda like in that hustle of like They kinda thought they had it all figured out, but they don't, but they don't realize that yet. But that lets them do some cool shit'cause they don't know what they don't know yet. So they were just like Young stallions, like just you know, full of exuberance and didn't understand where the limitations were, what the drawbacks were, but that's okay. They'll run headfirst into that wall when it comes, but they're having a good time doing it. And then there was like

Me, Ben, like we're like in our thirties and it's like, you know, the thirty year olds are sort of like Okay, I'm s I'm you know, I still have enough energy to do things. But I'm not dumb enough to just do them blindly. I don't have that that that great ignorance yet. I yeah, I really like kind of over analyze things almost. And so the whole time we were like trying to think through our next project, trying to like sit down and Map it out and pros and cons and all this stuff.

And um And then there was you guys who were in your forties and you were like Yeah, Ramon, yeah. Yeah, you're like, Oh Ramon's like throwing out his back playing pickleball and like, you know, you guys were Basically some combination of like let's have fun, like let's go surfing, let's play sports, like, yo, seize the day. I don't know how much longer I'm gonna be able to do all this stuff constantly, like I'm doing it. And You know, like I guess like there was like an element of like Yeah, y yeah, business stuff is cool, but like life is a lot cooler than business.

Um where the thirty year olds and the twenty year olds were like, No Winning and business is a lot cooler than life. Uh. And like I remember just continually trying to be like, Hey guys, all right, you guys wanna Just sit down on just whiteboard for a minute and it was like, you know, just sort of like I was feeling this urge to do that. And I feel you guys were this urge to like

The sun is out. Let's go outdoors and like but let's wear our sunscreen'cause like we don't want to die. There's like this element of like I wanna live and I don't wanna die. And that's where you guys were at. And then We hung out with like a seven year old guy and he was just sort of like You know. I want some action. I'm I'm bored. I want some action and like

You know, um I wanna contribute, I wanna give back and like that was like a big focus and like Uh, you know, it's just fun to have like This energy around me. So that was kinda one observation I had. Is that is that Accurate as far as you read it, or am I my making stuff up here?

Yeah, it's super accurate. Uh Ramon and I were like, it's Saturday night and we have a bunch of entrepreneurs who are just like Try to sell us on their business and just like get themselves excited and meet people on network. And me and Ramon were like, It's nine o'clock. I think it's time to go to bed. And these guys are like, No, let's stay up till two AM. Let's talk about business ideas. Let's start a new business tomorrow. Oh my God, this guy's selling mini katana's on the internet through YouTube and TikTok.

Wow. Uh So it was a real funny thing. And then you know You and Ben were like, Let's talk about new business ideas. Here's a new business idea. What do you think? What do you think? What do you think? Oh, what about this? What about this? And Ramon and I are like, How about we jump in the pool?

Yeah. Like just take an ice bath. Yeah. So it is funny to see these different seasons of life and um Yeah, I'm trying to kinda adjust to this new season. And uh for example, now on Saturdays and Sundays, I try not to touch my laptop at all. And be outdoors and with friends as much as possible.

Well that it's it's hard to make that shift in that season. I mean, even at the beginning of this podcast like I'm gonna buy a public company and take it to the moon and then it's like Actually I'm gonna like enjoy life and like, you know, whatever, you know. Do family things and th things like that. It's it's It's hard to even be congruent in a one hour podcast. with like, you know, a a a kind of like direction. Um so you know, I I think that's

That's I've observed that amongst many, many people. It's like very hard. It's very hard to stay congruent. Uh, I I noticed this about myself. Like I'll be like, Oh, I love This content podcast thing, this is great. I think I could be the best at this. And then uh and then I get all this positive feedback where it's happening and it's like growing and people like it. And then I'm like, yeah, but should I start this business doing this B2B thing?

And then it's like, Wait, what happened to the whole like I wanna do this content thing? It's like ah I don't know, like I just It's hard to be congruent in it and It's e very easy to get distracted and get off. Kinda like mission when you're used to doing one thing and you know you can always go back to that well. And do it.

And there's this new thing that you think might be the right thing for you. But is different and maybe a little unfamiliar, a little less familiar. I met this guy who uh started a company called Solo Stove and sold it Um and it then later went public. uh named Spencer and um

He was like, I started this company, I work really hard, I sold it, now I made mega bucks. And uh I'm good. I'm financially independent. I um He doesn't invest in any startups. He doesn't invest in any private equity funds or V C funds. He's like when people are like, Do you want to invest in this, that, the other thing? He's like, No, I'm good.

He takes all of his money and puts it in the stock market in the Vanguard VOO, the Vanguard S P five hundred index. Doesn't think about it at all. And uh He says that everyone else who uh is like this is an entrepreneur, starts a company, makes it.

And then goes back and starts another company? They're only starting another company because That's the only thing they know. Yeah. And he's like they just keep building a new prison for themselves. That's bigger and brighter, but it's still a prison.

And uh why would you do that? And so I had this call with him and then for a week after that I was just like Walking in circles, uh, like muttering to myself, What am I doing with my life? What what am I doing? Why am I starting new businesses? What is all of this? Um So it's really interesting to see people on the other

End of the spectrum. I think I told you that once when we I remember we were at uh some park in San Francisco and you were telling me about your new thing and it was working great and I was like I was like, I that's I was like, that's great. And I'm like, uh I admire that you do this with such ease. It's like watching Steph Curry shoot three pointers. Like wow. You just can start a business and it just works like this? What happened to all the hard, gritty stuff that I feel all the time? Like you're just doing it. That's amazing.

Um, but then I also told you, I was like I feel like you're Playing the same level of the video game again. And like, you know, you kinda beat this level. Like shouldn't you just like go to the next level? Uh, I don't know what that level even is. I don't even know what that means. Maybe it's not even business. Um But like, you know, I said that and I felt like a real dick afterwards. I was like, that was a stupid thing to say. I remember like

Feeling like you know, that I was I w I first felt really bad, I was like That's just kinda like a a I don't know, like That probably didn't feel good uh to say that or to hear that. And then I was like also like I was like, Well, do I believe it and like

You know, would I want a friend to tell me that if they felt that about something I was doing And I was like, Yeah, I think I would and I was like, I think he doesn't take that stuff seriously, so you know, that's no problem. Um but you know like I I've felt that and and I've s I've felt seen that now in many people, the same like Build a prison of your own making.

And like you said, the only people who win are the ones who sort of opt out of the rat race. And it's really jarring when you see that. And you're like, Wait, what, you're leaving? But You could do it.

We're still here. And they're like, Yeah, we're still here and they're like Yeah, it's great. Um I'm gonna go wander over here. And I'm like oh my God. You can leave this room? Like that I didn't know that was possible. It's like it is honestly very jarring when you meet the like one out of a hundred people in Silicon Valley who do that. Yeah, it is uh

stunning that people do that and um It's so interesting, uh, when you meet people who do that and like what they choose to do with their time. Like you were telling me about that brain tree guy who's like I'm trying to maximize my life. I'm trying to reverse my Biological age. Yeah. Yeah. And so I

Change my diet. I've got like a team of doctors, uh, nutritionists. physical therapist trainers and I'm reversing my age. Um And that's what he's doing with his time and energy and money. It's super interesting to hear when people Yeah, the thing is.

Which is that um my life is actually limited by my imagination. And um Growing up I always assumed it was limited by, you know, money. or resources and now I realize my life is just limited by my imagination. And uh

One of the things it made me do is I'm trying to hire a chief fund officer. My definition of fun is often like let's work. And let's grind it out. I'm trying to hire somebody who's the exact opposite of me to Be like, no, that's lame.

Uh here's like five more fun things you could be doing right now. Go do those instead. And I will literally close my laptop and just go do one of those five things in response to that. That's amazing. You uh that thing you just said, that my life is limited by my imagination, I think that's probably Like I don't know how many minutes into the podcast we have, but that's a that's like a golden nugget right there. Like that's something I'm gonna think about a lot.

What uh say more about that. Like either how you thought of that or what's an example of that. Yeah, um you know, it's funny'cause I'm uh living with my brother right now and the two of us wake up and we're like, it's Monday morning, let's go, let's grind it out, let's go, let's win the ballgame. And um Yesterday we like played paddle tennis for four hours until our limbs fell off. And that was way more fun than whatever work we're gonna do today.

Um And so I just want somebody to Uh Like I don't spend enough I spend all this time being like Uh actually what's what's happened for me is I as I've seen more businesses and gotten older and more experience, I feel like

This is a little bit of a hyperbole, but I feel like Neo in the Matrix. Where you show me a business and I can like see through it and actually see the fundamentals of the business and have an opinion. About whether it's a good business or not. Or I see opportunities where I'm like There's a hundred million dollar

business here. And it's just a matter of like doing the work and executing it and it could be a real business. Um So I spend my so much of my brain power thinking about that stuff and very little of my brain power thinking about how to have fun. and like other cool things that people do in life.

I spend a ton of time reading the Wall Street Journal and talking to entrepreneurs. But very little time talking to uh Instagram influencers or Just people who are like bawling out and having a great life. Um

And so I just wanna spend more of my time and energy imagining fun things to do, like I love magic. I would love to have A magician. show up randomly in my week.

Um like while I'm at a restaurant, a magician shows up and is like Hey everybody, I got a magic trick for you. And then does a magic trick at the table. I a friend of mine told me that him and a bunch of guy friends would go to Vegas every year and one year Um, this guy was in charge of planning it and he hired

Um like five little people in uh tuxedos to follow them around. And then a bunch of um Like the Brazilian carnival dancers to follow them around the whole weekend. And so everywhere they went, everyone was like, Who are these guys?

They got into every club. They got free drinks, they got to all these people coming up to them. And uh they had a dope weekend as a result. And you know. Lots of people just go to Vegas and like go to the hotel and gamble and these guys just through their imagination had a better way of doing it.

Yeah, amazing. Um all right. This is this has been good. Uh where do people find you? You're you started tweeting, so so shout out your your handle and then We can wrap it up. Yeah, uh my goal is to get to one hundred thousand Twitter followers by the end of the year. So I'm gonna be tweeting a bunch more. Uh my Twitter handle is my full name. Uh S U L E M A N A L I Yes. All right, great.

Thanks for coming on, man. You bet. Thanks, John.

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