Native Founder Tells ALL: $100M Portfolio, Investment Strategy & Business Ideas

I texted your brother, I said, Hey, I'm about to record with your brother And he goes, uh he got progressively more truthful. He goes, Tell him I said hi. Then he goes. Tell him I said honor the Ali name. Then he goes And tell

So yeah, I've delivered the message. I feel like I can root Well It be what I want to

I put my law in it like my day's all on the road, let's travel now. Boys Ali here, you've been on the pod before Uh, people know you because you created native deodorant, which is sold. Everywhere I look and target Online.

In my wife's bathroom, it's there everywhere. So congrats you built that you bootstrapped that business yourself. Uh literally like off of a kitchen table. to a hundred million dollar exit to Proctor and Gamble. You spent a couple of years there. You currently uh you invest in a bunch of e commerce things and non e commerce things. You have a podcast called limited supply, which is great. And then you um

You also Do uh you you and your brother are sort of like business sharks and so Uh, you know, if I just say, Hey, there's like a There's a hot dog stand going out of business over here. You'd be like, Let me get my jacket. Let's go. Uh you own real estate. You own a bunch of random things. And so always fun to have you on, man. Uh thanks for coming. Well, thanks for having me. Super excited to be here.

Is that the intro you want, by the way, or do you feel like I let I didn't do you justice in one angle? Uh no, that sounds uh that sounds uh like uh more justice than I deserve. Well, you're also good at one lines. Uh you have a lot of like one liners. You're you're very good with language. You um you've said a few things, you said my two favorite words in the English English language Distressed asset. And then one time we were talking to this person It was you and me and this person.

And they were explaining what they do, and it was like a supplement company and how great it was gonna be and how they're raising all this money, and she she or them or he, whatever, walked out the room. And you said That person's business is one Google away from me ruining it. Yeah, you have a a couple other classics. Uh I read an interview with you where it's where you said uh And you said I forgot any phrase of ego.

I was put on earth. To do one thing. Raise Earnings per share. Yeah. That wasn't me that said that, actually. It was the founder of some other company. I forgot what it was. And it was such a great quote. I loved it. Uh uh so I I stole that quote.

Yeah, you're like I killed him and now it's mine. Uh, that's right. Yeah, yeah. The other one that I I I attribute to you, I didn't I wasn't there for this story, but I've told the story to like hundreds of young entrepreneurs and they get a kick out of every time, which is a like Yeah, Moy started native deodorant. It's super successful now. And when he first had the idea

He told people, I'm gonna create a natural deodorant brand like Moy's like D do you know anything about deodorant do you wear deodorant noise? What's going on? What are you talking about? You're gonna create a deodorant company And you said. Um Yeah, t I know nothing about deodorant today, but in six months

I'll know everything there is to know about deodorant. And that's right that attitude to me is like That's at the core of what we do on this podcast. So I don't even know if that's a real story, by the way, but I'm gonna keep telling it. That's a real story. I remember I was in San Francisco. I was with uh one of my law school classmates, and it was her boyfriend at the time, now her husband. Who told me that and he's like, uh, you know, what the hell are you doing here?

He worked at Pinterest and he's like, What the hell are you doing starting a deodor business? I've never heard Anybody do something so ludicrous and I still remember the bar we were sitting at where it happened. All right, so let's do a little segment that I'm gonna call storytime. With Moy Zali. So Okay. Uh Cue the music. Okay. So I'm gonna ask you a question. I want you to give me your answer. Boys.

What is the um Uh what is the worst way. That you've ever made money. Yeah. Uh You know, this is um

Uh th this is a the a great story I I think we've uh we don't tell enough, or my brother and I don't tell enough, which is When we were growing up we owned gas stations. And this is really a family way we made money and not my particular way. Anyway, we owned a bunch of gas stations and we would cash checks for people as a service. So if you brought in a check.

Uh, Sean and you're like, Hey, look, this is my payroll check. It's two hundred dollars for this week or two thousand dollars for this week. We would charge you a percentage of that check and give you cash for it. And we would take the check and deposit it into the bank. And um by the end of our gas station careers, we were doing this at massive scale, like Uh one of our stores would cash two hundred and fifty thousand dollars worth of checks on any given Friday.

Like a quarter million dollars of cash was going through our hands. We'd have like Wells Spartigo coming over and giving us cash. Um and you know, we'd be giving it like you know, we have these crazy th like a bus full of Hispanic immigrants who are roofers would come to our store. The door would open and like it felt like forty immigrants just came out to cash their checks with us. But a long time ago, like what happened early on in our check cashing careers

Was this guy named F M Porter who came in with a check for his business? And the check was like, you know, it's two thousand dollars and we charged a lot because I don't remember why we charged a lot, but we gave them like nineteen hundred dollars. We charged five percent of the check. And we were gonna deposit the check and earn two thousand dollars. Um, and you know, uh traditionally what happens is if you're cashing a check, this doesn't happen so much anymore, but it used to happen 15 years ago, you'd endorse the back of it and you'd deposit it at the bank, right? So he endorsed the back of it, we gave him the nineteen hundred dollars, we deposited it, and it bounced.

And we're like, what the fuck? Uh this is a ton of money for us. You know, we were poor immigrants, we were working at this gas station. Probably b in nineteen ninety seven earning forty thousand dollars a year with all five of us working at the old were you? Uh I was probably like thirteen at the time, twelve or thirteen at the time. And like this was going on. And so there's just are you is I just imagine like thirteen year old boys like pacing smoking a guards be like, What the fuck, man? Like Is that what it looked like? I mean, just like I I imagine you being the exact same way as you Or now when you were twelve. But I didn't have as much confidence. So I couldn't take the cigar I I couldn't order people around.

But anyway the check bounced and we all freaked out. And uh we tracked down this guy uh and we're like, What the fuck? We knocked on his door. I forgot what he lived he lived in like a small house, obvious like you know it was just local community. We knocked on his door and we're like, What the fuck, FM Porter? Just checked his cash, we're gonna kill you, we're gonna call the cops. We don't know what to do, we're broke now. Uh gives us our muddy and he was like, Relax, guys. There's a pro like, you know. The check was made out to his business instead of him, and so it took like forty five days.

Uh to figure out all the a rigor moral to get the check. made out to him instead of to uh his business. And then we cashed it and we uh deposited the money. And I remember it went through the second time. You know, we made a hundred dollars on forty five days of two uh you know, possibly losing two thousand dollars. I remember it went through and I told my brother

Hey it went through. And he's like, that was the easiest hundred dollars we've ever made. And I remember it was like the worst one hundred dollars we've ever made. It was just cashing checks that were going bad and constantly being afraid that they were like this this was early on in our career. We weren't sure if we should do this as a service for our business. It ended up being super profitable. Like when cash Two hundred fifty thousand dollars of checks on a Friday, you're gonna make twenty five hundred to thirty five hundred dollars on that just for your business on that day alone. But I remember early on we were taking all these risks and we were like, What the fuck just happened? We think that like, you know, we're not gonna be able to pay our rent for the apartment that our my family lives in.

That's insane. Were you just going back to like math class after your shift? Like how were you were you going after school? What was your how did you do this? Oh, to the gas station you mean? Yeah,'cause you're like thirteen years old. Yeah, yeah. We'd go on the weekends, like uh'cause you know, we'd like um yeah, we'd go on the weekends. When I turned sixteen I could drive and I would go, you know Yeah, after class or like on the weekend. I wouldn't go every day. Uh, even when I was sixteen years old, but I'd probably go at least one weekend or maybe both weekends of the uh

Oh when I started having a car. We're in the story. We're in the story uh part of the show. So let me ask you one thing that I don't know is true, but I want you to confirm it. So right by our office, the one that you and I shared, there was a cafe called Native Coffee, I think it was. It was the native cafe. Native juice. Native juice. Native juice. It had the same color. And the same logo as native deodorant. Did you it and it was right by the Bart stop, I believe. So if I'm imagining what happened, you went on you were on Bart and you were just walking around Soma and you saw it and you go There it is. That's mine now.

Is that tr true or false? Subconsciously. That's false? No, it's not. Okay. We gotta put the picture up because they're identical. It's an identical. If you're like your phone right now to the listener, search Native Juice San Francisco. I actually think they changed their branding in the last three years, but you can still find old logos on their Yelp Yelp page. Yeah. So the cr uh it's yeah, a little funnier. Like it was actually a block away from where I lived. Um so I'd walk by it all the time.

But uh, you know, the color I'm not sure if the color was the same. I know the font was the same. Uh we actually didn't steal the font from them, although I readily admit we did steal the font. We stole the font Of our website from Harry's. So if you look at Harry's Font, it's the exact same font as ours. And if you look at the colours of our site

It was, and I'm not sure if it still is, the exact same colors that Casper had. So look, you know, when I was launching native, it took me about you know Three days to do the whole website. And I was just like, okay, you know what I'm not gonna do is hire a logo designer and spend a fortune building a logo and spending a lot of money on branding. I'm gonna steal the logo that Harry's has, which is just their name written out of font. I'm to do the same thing.

Uh I can't steal their colours as well, because that'd be too Too blatant. Uh so I'm just gonna steal the colors of another website, which was Casper at the time because they were doing really well. And so that's how the uh that's how the font and the colors came together to be what native is today. Um

But I I would walk by that store all the time and like believe it or not, right next to Native Juice Co is the post office. And I was packing all of the deodorants in my own apartment. uh for the first six months or year of the business And so I would walk by Native Jusco with these bags of like, you know Filled with boxes of deodorant, so I'd go to the post office.

And I'd hand them to the post office and they were like, Is this from next door? Is this like the juice company? You guys it says native on the packaging, and I was like, This is not the same native, it's a different one. Uh and then what would happen is like you know. Two and a half years into the business. Native juice code came like the woman who started that business came to her office and she's like I'm getting so many fucking phone calls for your business for customer service issues. Where's my package? All the shit. People are just Googling native San Francisco. We didn't have a phone number. We st I think Native still does have a phone number posted. So she would be like, I'm getting forty phone calls a day for you. This has gotta stop. You gotta figure out a way to stop this. And we're like, we can't we don't know what to do. Like

You know, people just Google native San Francisco and your name comes up. It's not we're not saying call you. And so she came in like several times. And then um you know I was like I told the doormen of the building I was like don't let her up any longer. And that seemed to put it into it. If she has juice accept it, but don't let her. But I was like, I'm not sure if they like this or not. I have to imagine. Yeah, that's probably true too. Yeah. But the reality is we like uh the the logo didn't come from native juice go, it came from Harry's She just happened to also copy the Harry's logo. That's what she might have done the same thing. That's right, yeah, yeah.

All right. So you said you had some ideas for us. Um, what business ideas do you have on your brain right now? Um, okay, I I thought about m a lot of these ideas for a while. Um, I think the first idea that someone should start, if I if I were starting a business today and really excited about it. And start with a stock market for all residential real estate. I would say okay, I'm gonna start buying residential real estate and s uh you know selling shares. Of that real estate that's rented out. So I buy rental homes.

And I would sell shares of that real estate, sort of like a traditional L P would invest. But I'd make a really liquid market on my site. So I'd say you know what, rents have gone up. You paid ten thousand dollars, you're waiting for us to sell this home. It'll be like you know, if you buy an apartment building today, if you're an LP in an apartment building, you're waiting for the GP to sell the apartment building before you get or you can realize all of your cash back. You might be getting a steady stream of income every quarter, but when the GP sells the apartment building, that's where you get most of your money back. I just create a liquid market for all of these things. And I'm slowly start buy every single house in a neighborhood. And I would say you can only buy and sell shares of this house on this platform.

Uh and then what I would do is I would empower local entrepreneurs To buy and sell houses on the platform themselves, too. I'd say, okay, you know what? Sean is gonna buy a house. He lives in this neighborhood in C uh in California. He can buy a house, put it on this platform, raise money, and buy and sell and other people can buy and sell shares of this house through this platform. And then Sean will get reviews just like on Amazon. And like if he does a really good job, people will give him five star reviews because they're getting a lot of money from it. Does a really shitty job, people will give him one star reviews because he's doing a really shitty job. And then when you go to underwrite new deals, people will be like Sean is trustworthy. Sean's not trustworthy. And I think people have tried this in the past with things like reality shares.

And a bunch of other shitty models of this. And I think they've done a terrible job. In part because they're not doing a good job underwriting. In part they're doing it uh they're they're betting on commercial properties. Um and in part because they're not creating a liquid market for it. And so I think that um When I think of like the biggest idea possible, I think that this idea Could r realistically own, you know, two hundred years from now.

This business should own the majority of real estate in the United States. Uh so let's break that down. So you said The reason that the current kind of like buy a fraction of uh, you know, uh of real estate or buy shares in real estate. Which there's several or crowdfunding for real estate. There's like

Fund rise, reality shares. You're saying the problems that they have is Uh let's take them one by one. So you said they're focused on commercial. Why is residential better than commercial for this? Uh way easier in terms of steady income streams. So like um if you build if let's say you buy a building that Starbucks is using and has a five year lease on, when Starbucks leaves that building Uh it's unclear who will be a good fit for that building.

Like it's not easy to rent that thing out. While if it's a house Everyone in the world needs a three bedroom, two bath house. uh in a neighborhood. And so it's a lot easier to relet properties that are residential as opposed to commercial. I invested in the company uh somewhat in the space. It was called Dorsy. It was um It it didn't work out, but the guy who started it previously started Stay Alfred, which I don't know if you remember that one or not, but basically you could it was like an it was an auction website for homes. And there were they had two issues. One it

Which is I'm shocked by this, but people just didn't want to buy a home online. It was just like a big it was a it's a big thing that they couldn't figure out how to address. Uh I think someone will figure it out. But the second thing was negotiating the whole broker industry, which like it seems like the broker industry, I know there was just like a big settlement like five days ago. The broker industry has like has this industry by the balls, it seems. Uh it's real it seems really challenging. Yeah, and it wasn't a settlement, it was a jury verdict of two billion dollars that went against the National Association of Realtors. Like Yeah. Yeah, and so like yes, the the I think the broker industry is broken.

But the red the the like The liquidity market for real estate investing is huge. And when you think about it, like, you know, all these retail investors are now like, let me invest in a startup. You know how crazy it is for uh for you to invest in like native when it's early on? Like I have no fucking idea what I'm doing. I don't know if I'm gonna get hit by a bus tomorrow. I might just be like, fuck it. You know what? Like uh I'm dating this crazy girl and she wants to go to Hawaii for three months? Fuck this. This is gonna be way This is gonna be way more fun than running a business for the next three months. So uh investing in re like if you can invest in startups. Well like you know you know it's way safer than investing in a startup, investing in real estate down your street where you're like, I know who's gonna rent this house. I I like, you know, I can monitor it, I can drive by it, it's a tangible piece of property. Like, you know, if this guy doesn't pay rent, somebody else will. It's not going anywhere. It's way safer. And I think when I think when I think of retail investors,

I think retail investors would be way more excited about investing in the local community they live in and be like, Yeah, I own a share of this house. Then they do being like I invested in this Pakistani guy. Who uh really likes And he seems not to be that reliable. And so you

You have like Uh This idea. Why do you think that the person who's buying these rental properties wants to do this just because they want The liquidity so they can go buy more properties. Uh, like what what what happens here and how much of the property you think would go on the platform versus they own? You know, like what would they

Like in an IPO, you know, they they issue twenty percent of their stock or whatever to the public. What would you what would it be for the house? Yeah, I think it's really the GP can be like, look, I wanna like the guy who's sort of underwriting the deal and sponsoring the deal for better or for w uh worse is could be like, Look, I'm gonna put in this house costs two hundred thousand dollars, I'm gonna put in fifty thousand dollars of my own money, or I'm gonna put in twenty thousand dollars of my own money. And in that same way that other like right now, if you invest in a much larger uh if you invest in a private equity fund One of the common questions you'll ask is the guys who are running the private equity fund, how much of their own money is at risk? Because that means that they care and believe in their private equity fund. Similarly, here it could be the same question. How much of your wealth or or how much investment are you putting in this real estate when you uh purchase it? And the reason that the sponsors would want to do this is several fold. One is, yeah, they want to create a liquid market, they they want to raise money, right? Like they want to raise money from retail investors.

And it's really hard to ri raise money from retail investors. Uh two is they can buy and sell shares uh later on for themselves as well. They could be like, you know what? I bought worth of this house. Five years later, that 40,000 is worth 80,000. I want some cash off the table, but I still want some liquidity. I'm gonna sell forty thousand dollars of shares. Uh in this house and keep some uh money in invested as well. So I think for the same reason that people want to invest in the stock market

Or uh, you know, sponsors uh uh invest in their own deals. Uh you know, sponsors in this would invest as well. So Moise I'm gonna pitch you three other real estate ideas r in rapid succession. I want you to tell me Your favorite.

To your least favorite. Okay. Uh, the first one is this company I didn't invest in, but I regret I regret I don't know how it's doing. I haven't talked to the guy in a while, but I reg I regret not investing'cause I I thought it was a good idea.

It's called home options. So what he's doing is This guy goes to uh Sam. Sam owns a house. He goes to Sam and says, Sam, I know you're not trying to sell the house right now, but Here's the deal. Um I'll give you twelve hundred dollars right now.

And all I ask for is that when you do decide to sell Um You let me, you know, I own the option to be the broker on the house. So like, you know, I'll be your agent and uh And actually what I do is I'm not myself the agent, but I partner with top agents in your network. And they don't know when you're gonna sell your house and they don't wanna keep having to knock on your door and bother you. So I'll give you cash today.

So that they can be your bro, you know, and one of these top agents gets the right to be your broker. twenty years from now, whenever you sell. And um they're just buying up options. uh the r the right to sell these homes. Cause a home when you sell, you know, the brokers take Let's just say let's just say the cell side's gonna take three percent.

Um, you know, they're they're gonna let's say the average is fifteen thousand dollars or something for that for that sale. They're willing to buy that option today for a thousand dollars. And so um that's idea number one. Home options. Go on go through and buy that. Uh all right. Idea number two is

Yep. I invested in it. The only thing that could have made me feel worse about not investing in this is that Sam invested in this. Is it doing well? Because I I every m like three months I think about this business, I think That's gotta be I went through my email and I haven't gotten an update from them. And like

A a while. So that's not a good sign. Yeah. Which unfortunately means it's probably not or It's absolutely crushing. One of the two. Um You know, I I I used to think that's always a bad sign, but then I started hanging out with uh Moise's brother and he never he's like investor update, why would I I'm gonna kill it in this business. Why should I tell you about how it's going? I need to know this. That's right, yeah.

D are you that way too, boys? Do you do you like do you provide updates? One of our investors uh was this guy named Jeff Hollander from seventh generation, and he's like, You know what would be nice is like a monthly or quarterly investment update, and I was like, Here's your money back. I'm you know, you I you and I will never chat until I call you. Uh and if you're not okay with that. Yeah, yeah, I'm like I was like I couldn't care l like I will never send you one piece of information about this business unless uh I want to. Unless I need something for it. Don't you think it's good hy good hygiene to like, you know, just kind of even for your own thoughts to c be like, how are we doing? What's a s let me take a step back here for a second and just Write down kind of

For my own clarity of thought. Or no. Um, I think that is good hygiene, but I don't think you necessarily have to share that with other people, especially with other people like you know. Um I think the three of us are probably investors in similar businesses. And you know, oftentimes I walk around and people are like, Here are the numbers of this other business. And I'm like you know, somebody has leaked it to them.

And I'm I I try to be really careful as an investor to never leak information because I know I would never want my information leaked. But like that information gets around the street and Uh I you know, I've seen so many startups launch because they're like, I heard this guy was doing really well, so I should just do the same thing. Like, how many competitors of Athletic Greens exist? Because everyone's like, Yeah, we know Athletic Greens is doing really well. Right. What are the other two, Sean? All right, second. Second idea. This is your brother's idea, actually. I don't know if he told you this one. Um

Pipe for real estate. So uh I I think I could share this now'cause he t he's talked about this like I don't know, a year ago and Didn't end up doing it. Um

Pipe for real estate. The idea here is uh you're a landlord, you're gonna collect m rent every month. Uh pipe came through and was like, Hey, let me turn those uh monthly checks into one annual check. And I'll take a eight percent fee off the top. So let's say you're gonna get a hundred grand of rent from this property. Um, I'll give you ninety two thousand today. I get to keep the hundred. Um

And you get you get ninety two thousand that you can go invest in your next property. You get or or put into tenant improvements that will let you raise rents or something like that. Here's cash flow today. Up front. So pipe for real estate. Uh real estate's a huge market. Uh why why do landlords have to wait to collect the check?

Um No more waiting. Is our slogan. All right. Now idea number three, final idea. Uh I did invest in this one. So Steady Capital. So Steady.capital is their their URL. So they were like, Hey look.

Everybody knows that most will most millionaires build their wealth through real estate. That's that is a Time tested, you know, approach to wealth building. Um most people actually even want to. They would love to own a rental property and be getting a rent check every month. But most people don't know don't trust themselves to find a property

Yeah. Buy it, manage it, all of that. And so they were like, We'll do a r Robin Hood for real estate type of thing where You just decide how much monthly you want to put into real estate, you say I'm I'm willing to put it away five hundred dollars a month into real estate.

And they basically let you take the five hundred bucks, they'll put it into a real estate project that they are kind of vetting. Uh from like Proven uh operators. And then they every month they'll say, Hey, here's an you know, you got a hundred and twelve dollars of you know, rental income from your property this month. Yeah. Uh or you you now own fr you know, pieces of these six properties in six different markets, and you're making six hundred dollars a month of rental income.

Like I I put five grand into one deal and I just get this check every month now and it's actually The first real estate that I've done that I didn't own because Otherwise it just stayed on my to do list. All right, so those are the three ideas. Pipe for real estate.

Yeah. And Robin Hood for Wheels. Yeah. Yeah, Study Capital. Um Give me rank them from your most favorite to your least favorite. Go ahead. Okay. I I w I wasn't like it. I was expecting uh home options would be number three when you told me about it, but in fact it's number one. Uh steady capital and then pipe for real estate. Uh and I'll tell you why.

Um piper real estate exists. And it's just called the Cash Out Refi. Like, you know, it already exists where you're like, look, I'm getting real you know, I'm getting money from these landlord uh from these tenants and I can take cash off the uh out of the property. Like You know what's not gonna happen for pipe for real estate is someone's gonna come in and be like, Wow, you're a hundred percent levered up with his debt. Let me also give you more cash.

Uh you're already paying for the debt, you know, you're already lovered. Uh, so I think pipe for real estate exists. Uh, and I think you know, Mark Lore started this company and he just raised three hundred fifty million dollars. Did you guys read this thing? Uh I'm not entirely sure what it is, but it appears to be like a restaurant delivery business. And um so I I feel like I'm not sure if this is the case, but it seems like that's sort of like a A start up branding to something that kinda exists in the in this space, I feel like pipe for real estate is the same. Mark bought blue apron.

Oh, she bought Blue Apron. I knew they s uh sold for a hundred two million dollars. I didn't know he was the cash behind it. Yeah, he bought it. Yeah, so he is you I think you're you've nailed it. That's sounds like that's what he's doing, but go ahead. Yeah. Um home options is I like you know, I think the hard part about home options is right now, like particularly in the last week, right now we don't know what real commissions are going to look like in the future. And you also just don't know how long an option this is. As the twelve hundred dollars

In the ground today for twenty years or thirty years. That's a really long period of time. For instance, I think what he's doing is he's just reselling it right away. Or at least that's what I would do is I would buy the option. I would bundle them up. And I would go sell them to the brokerage. tomorrow, you know, and just say, Hey, you you can hold these and you know

I try try to get the I don't know if the economics all work. I don't know the brokers are willing to do things like that. Yeah. That's the idea. Yeah, I like it. It's innovative and like different and unc like you know, unclear what'll happen, but like You could revolutionize an industry that, you know, has been the same for the last hundred and fifty years.

God damn it, Sam's gonna be a part of that revolution. It can also be the six percent drops down to two percent in the next, you know, three months because you know the National Association of Realtors is almost certainly bankrupt at this point. What was the settlement and what's changing about this broker situation? Yeah, it wasn't a settlement. It was$2 billion. I'm not entirely sure what it would what it was. It was like price fixing across realtors, uh basically saying, Hey, you can't be on MLS unless you agree to pay everyone like a six percent or five percent brokerage. Something to that effect. I haven't but gotten to into the details a bit. But like the judgment was two billion dollars, and I read this Wall Street Journal article where Once the judgment was had But uh plaintiff's firms, uh, you know, file lawsuits against the National Association of Realtors in every single state and they're like, We think that we'll get forty billion dollars in judgments as a result of this.

Which will certainly bankrupt that organization. Can you talk a little bit about this founders card thing? Because I've know you've been tweeting about that for like two years now, and I'm I and that actually surprised me that you were interested in it. You know, there's I feel like there's uh there's a a a a club that I'm a part of, or like a founders card sort of thing that I'm a part of. that I can't talk about the uh the name of it'cause they would ask me not to. But with like as a result of paying my hundred dollar a month um uh monthly f uh membership fee. I get a discount that's worth like, you know, eight hundred dollars a month to myself. What do you get a discount for?

Just SaaS software that I'm like, uh really want that I have to pay for. But do you have to be a new c a a lot of those cards, you have to be a new customer. No, this one you don't, yeah. Wow. You just pay a hundred dollars a month and they're like, here's discounts to like let's say MailChip, but let's say Shopify and like all these other SaaS platforms. that an e commerce company w might want to be a part of.

Or might want discounts too. And so then you go and say, Great, I paid a hundred dollars, I get all these discounts, and I'm gonna go use those discounts for um for the for for for my business. And so you never are going to cancel that a hundred dollars a month subscription because that hundred dollars is actually saving you a thousand dollars a month. And um I don't understand why there aren't more of these for smaller niche industries. And I think like e commerce is a great one. Like uh you know what P and G does? They go and they uh they go to like Snapchat and Pinterest and Facebook and they say look We're gonna spend

Fifty milli uh two hundred and fifty million dollars across our portfolio on your platform, but we need a discount because You know, we're spending so much money. And they get that discount. They get it from Facebook for sure,'cause I've seen it. I'm pretty sure it and I'm pretty sure Snapchat. But I guarantee you they get a Facebook uh discount for Facebook'cause I've seen it.

Uh I you know, I saw it when I was running native as a part of P and G And so I'm not sure why smaller businesses don't organize and say, look, we're spending this much. Let us also try and negotiate discounts with platforms. Why don't we all negotiate a discount with Yappo or with Otendo or with PostScript or with Clavio and say, look, there's gonna be 400 of us together. A lot of us are gonna use this software, but we need a big discount that's a lifetime that's a like a lifetime monthly recurring discount. And so sorry, you have one of these cards. This is not an idea. You're saying you have one of these cards But you're saying you uh it's like a secret? Like you don't uh they don't they don't want more people to have the card or what?

Correct. They would not want me to talk about who they are, but yes, as a result I get discounts to software that I wouldn't uh get otherwise. And it cost me a hundred or a hundred and forty dollars a month. Why don't they want to talk about it? Yeah, great question. I'm not entirely sure, but I'm sure they would tell me not to talk about it. Well, like there's Yeah, wouldn't they want more spoty s uh some spotty sense is going off here. Uh, you know, like what's going on? Why I mean, is this uh a shady thing? Damn, this was This was your idea. Um

Like uh you uh not your idea originally, but like Sam told I mean, I don't know, seven years ago when you were running the hustle You were like, I'm trying to think of a new product. And you had three ideas. And I remember one of them was Basically trends, which is the thing you ended up launching. Another one was uh this idea for the founders club card or whatever, which was I think you were comparing it to the AARP. You're like ARP for

Kind of like Millennials or I can talk about that A R P in a second, but yeah. That was uh the second one. What was the third one? You had you had one more, I don't remember that third one, but And I thought the card was the best idea. I was like, Oh, you should for sure do this card if I had this on and in fact I actually now I'm just gonna do the card off of the M FM audience because I'm like this is way better and it's a win win. I I I might be a few months ahead of you. Why didn't you do that card? The reason why I didn't was I couldn't find uh I couldn't figure out entirely how to differentiate from all the other offerings that already existed.

Um, it was also quite challenging to get in with some of the brands in order to negotiate bulk deals. The argument being Well you know, these companies already spend with us. Why am I gonna give them a discount? And I couldn't come up with like the perfect rebuttal for that. And that like Th that is where I I was trying to figure out how to make it happen. And what is a rebuttal to that?

The runner for that is Your competitors are offering it, right? So you basically have to go get the number two of every space and say, Hey, we can move you some customers. If you make this attractive. And then you go back to number one, you say, Hey, number two's offering this and they're people are moving. Um

You should match it. Yeah, and like new people who get get in are gonna use number two instead of number one because they get the disc gap. Exactly, exactly. And we we continue to have new customers and we're just gonna keep telling them go with this company'cause they can offer, you know, a benefit. Yeah. The reason why I was interested in it is AARP. So AARP uh I actually don't know what it stands for, but it's a club for people above sixty or fifty, I think Fifty. American Association of Retired Persons. Yeah, is it so retired. So I guess it's sixty.

Um, they do about one and a half to two billion dollars a year in sales and they have millions and millions and millions and millions of members. The way they make business is uh revenue is I think they only charge about a hundred dollars a year to be a member and like most everyone when you turn sixty you get an an invitation in your mail. And what you do is you get discounted health insurance and they make Uh another side of their business is making money. It's a basically an affiliate fee. So I think they parted with United Health and they have the United Health ARP plan, which is discounted plan, but also a a plan specifically for whatever, you know, sixty plus people have.

Uh, and they are, I think, one of the largest lobbying groups in America. It's a huge lobbying group. They they they basically uh like kind of shape the government in in some regard. And so I thought that was super fascinating. It's a really fascinating company that's existed for decades and is it gonna go away anytime soon? And there's all already other businesses doing this. Like think about Y Combinator. We can get into Y Combinator. I think they're like you get, you know, two hundred fifty thousand dollars of AWS credits, you get a bunch of like stripe uh processing charges for free. And like those businesses are like, You're gonna grow, we're gonna make money at the end. Uh, but it also makes like, you know, when Y Combinator is selling you on giving you$120,000 for seven percent, they're also like here are the other benefits that you get in this business. Right. Um So anyway, I'm on board with this. Do you want to do one more?

Yeah, what's the other idea? You had something around Shopify for high end or something for high end D to C what was that idea? Yeah, sure. Um, you know, uh Shopify is fantastic. I'm a big shareholder in Shopify. I love them. You know, I built my career on in e commerce. Uh, the reality is it's wonderful for businesses going from zero to fifty million dollars. It's awful for businesses north it's not awful, but it's not good for businesses north of a hundred million dollars. That are ready to spend a lot more on improving their conversion rate on a custom checkout page. And you know, if the Shopify people were here, they uh if the Shopify people were on this podcast with me, they'd say that's crazy. We have big businesses like Fiz and

All birds and uh a lot of other big businesses on it. But the reality is there's so many lot you can't customize so much and it's so difficult, particularly on the checkout page. That I think there is room for somebody to come in and say, I'm to build my own Shopify I'm the build Shopify for but for businesses doing north of a hundred billion dollars. And there's a lot of businesses doing north of a hundred billion dollars that have left Shopify. You know, away travel ritual vitamins because they're like, look, we've outgrown this platform. Where do they go? Probably usually custom built stack, sometimes with like this backbone of an old brand of an old business called Spree, which I think was like this open source.

e commerce platform when you were growing your business, but I don't think it's around anymore. Uh, but the I don't look you know, they'll often go to their own custom uh tech platform because they're like, look, we're doing enough business that this makes sense. Which is a pain in the ass. It is a pain in the ass, but like, you know, it's a pain in the ass is worth it when you're doing five hundred million dollars in revenue and a quarter f uh uh, you know, a quarter percentage point bump in conversion rate on your checkout page is gonna lead to an extra ten, twenty million dollars in revenue. It's it's it's it's completely worth it then. And um you know like Shopify's one one page checkout. Like they launched that in the last six months. That's been something that people have wanted for a really long time.

Shopify subscriptions has been really bad. Like all the subscription platforms have been really bad until more recently. So I think Shopify's trying to catch up on that larger uh segment, but I think they've done Their focus is You've decided you want to start a business, you go to uh you know, in the shower, you come downstairs and you start a Shopify store. That business is doing a hundred million dollars in revenue. You know, there are solutions that are competitive, or more competitive than Shopify is.

Uh and they're worth it because small changes in your website are gonna be worth so much and they're harder to do in Shopify than they are to do in other brands. Yeah. Candidly, like you know, Native was a fifty million dollar e-covers business built on WordPress. And the reason we did WordPress was because it was cheap, way cheaper, and because it allowed us a lot more customization. We could do post purchase pop ups at add to car pop ups at a time where you couldn't on Shopify. We could do subscriptions that didn't charge us now aren't allowed to have subscriptions that you can still can't do on Shopify. Uh, you know, we could have our own servers, which uh you know, you may or may not want based on Shopify. We could do instantaneous page loading, which you couldn't do on Shopify. And so there were a lot of benefits for a business for it because it was open source. Versus shopping. Yeah, you use the uh three hundred dollar a year.

Woo Commerce, which is like the steel of the century and the miss of the century for WordPress. It's free. It's is it free? Yeah, I mean I I I used it too. Yeah. I thought it Yeah, you know, all those features that he just said were benefits. Uh that's not why he did it, to be clear. He picked it'cause he was like three thousand dollars for Shopify, outrageous. I'm for my dead body. I would rather this business fail than pay you three thousand dollars. I had a business I was doing millions a year and we used WooCommerce. And I remember yeah, it's owned by WordPress now, I think. And I remember like looking at WordPress's revenue. I'm like, Okay, so WordPress controls a third of the internet. And Shopify makes this much money and yet they're

Giving this to me? What a bunch of idiots. You guys like you're it's a massive missed opportunity for WordPress. And WooCommerce is great. You just need a developer sometimes to help you do some stuff, but it's still way cheaper than Shopify. That's right. But like really it just goes to like, you know, we could we did a post purchase pop up at Native, which was after you click checkout, we showed you a pop-up saying buy travel size de over it. We've probably sold seven hundred thousand dollars of those travel size geobers every single month. Uh and made, you know, four hundred thousand dollars in net profit off those travel size deoberants. Uh and we could only do that in WordPress. We could not do that in Shopify.

You uh you also had something you were like, I would do sh uh Shopify apps. And I found this interesting because Our Shopify app bill. Now granted. I could go through and prune some apps that we're not using anymore that are probably still just recurringly charging me, but I think we spend like ten grand a month on Shopify Adols. Do you really it's insane.

Because whatever you want to do, they're like, Oh, would you like to collect email addresses? Well pay me fifteen hundred dollars a month for this pop up? Like what are you talking about? And they're like, Well, your store's big and it's like, that doesn't matter. This is an email pop up. Well who what do you care how many people type the into the form? Like Google Forms is free. What what are you talking about? And like Um, every little thing. Like we added a um a post purchase upsell and it was like nine hundred dollars a month and it was like What's happening? Why why would this be so expensive?

Um, all the review platforms are crazy expensive. Shopify apps are uh you know an absolute Like rip off in the pricing. Totally. And and I think that, you know, if I were if I were a developer in India, I'd be like, I'm gonna hire a team of you guys. We're gonna knock off every single app and we're gonna charge twenty dollars a month.

And that's gonna be our entire business model is twenty dollars a month. And like, you know, uh the the other thing I'd say is the more apps you use, the cheaper it gets. So if you're using five bar apps instead of paying a hundred dollars, you're paying seventy five dollars. Get the you know, like there is no reason that just do no pop ups should be fifteen hundred dollars a month. There's no reason that a post purchase p upsell should be a percentage of revenue and not thirty dollars a month. And uh the reality is that everyone's tiered percentages of revenue because you can make so much money doing that.

And this is software that like, you know Could have been written within a week or a week and a half by almost anybody. Um and should be thirty dollars a month. I talked to a guy, I tried to buy this one Shopify app. That um

All it did was it added a maximum to your cart. Like a feature people don't even think it's like why would I ever stop someone from buying share and it's like Uh, let's say you're doing like a limited edition thing. You don't want like the resellers to go buy all your shit. And uh These guys for for like seven years they've been doing like two million a year with a million dollar a million and a half dollars of profit.

Just on one Shopify app that just caps the maximum somebody could could buy of a of a unit. And that that's gotta be like, you know. That should be like two lines of code or something like it's crazy. Uh, but there are so many of these that that exist out there and people have smartly tried to roll some of these up. Yeah, and how many of those how many of the customers of that app are probably customers who don't look at their bill on a ever a monthly basis and they're like

Oh man, I'm getting charged two hundred dollars a month and I never think about it. Yeah, yeah.'Cause it's totally it's built first. You never whip out your credit card. You just Once you connect to Shopify It's gonna pay you for Shopify. Yeah. And then it's buried in the billing tab under all the stuff. So yeah, there's definitely uh

There's like low very low friction in like Yeah. Racking up those charges. There's a massive business to be built here, which is cloning the top one hundred Shopify apps and just charging a flat fee. Like you know, it might be a longer term business because you don't have a sales team and you're not going out calling everyone being like switch from uh, you know, Yappo to me. But it is a every single new business is gonna go to you because it's way easier to use. You have some controversial opinions. Do you have a lot of them? Um a few of'em. Data's overrated. Wealth managers are just used car salesmen. You uh hate real Twitter real estate. I want to hear some of your thoughts on on those things. We'll start with um we'll start with an easy one of data being overrated. What's what do you mean by that?

Um let's start with an easier one, which is tw uh Twitter real estate. Okay. Um Wait, say say the unpopular opinion. What is it about Twitter real estate? Uh it's full of complete shit. Yeah. They're full of frauds and they're Like I I can't begin to tell you how many people where I like read their tweets some deals I'm in and I'm like you How is nobody calling you out on this?

Like um you know, people like are you give me give the listener perspective here. So you own Do I maybe dozens or hundred or a hundred hundreds of either single family homes or multifamily homes, is that right? That's right. Yeah. And then I'm an investor in dozens of real estate deals through as being an LP. Okay. So you that that's your perspective. That's my perspective. I'm a you know, an LP in a lot of the people you know, people will be like, Did you unfollow me because of my opinion on the Middle East crisis? And I'm like, No, I unfollowed you because you're a fraud and you're pretending like you're a good real estate investor and you're a fucking complete criminal and I know it because I'm an LP in your business. I get like you know, even now I will feel my word boilet. They're tweeting out.

There's no returns. They're like, Here are our returns. And I'm like, these are not returns that I've realized as an LP in your deal uh as an LP in your businesses. And you know, they have the audacity like you know, I'll be like, Hey, uh we're like you know, before interest rates were going up, I was like, We do we have floating rate mortgages. What the fuck is gonna happen when interest rates go up and these guys are like, uh, it's gonna be fine, it's gonna be fine, and now they're like, actually, we need more money, and like You know, uh startups are one thing where you might need more capital as a business grows because you're trying to expand for some reason or another. Real estate is a business where once you own the asset, you should not need more cash.

You're not like expanding the real estate in any way. You're operating an apartment building. The problem is what happens is when the interest rates go up and you have more debt to pay every single month because you're on a floating rate, you need more capital to be able to pay that debt because the rents don't service it. Rents are going down. Interest rates are going up and these guys who have promised you know uh making fortunes are like uh are caught with their pants down. And then with the eight the which is crazy. Then they have the audacity to say, Hey, actually we're our returns are fantastic. Then they have the a but the other audacity that they have is they're like, Okay, though all the deals you invested in with in the last five years with us are bad because interest rates are up.

But now we can buy things at a lower price because prices have gone down, no interest rates are up. So buy with me. Now I'm a good now it's a good time to invest with me. And I wanna be like I wanna fucking kill you. Is really the answer. Um You said why isn't anyone calling these people out? Um Why aren't you calling'out? Would you like to name some names? We got a great audience here that would love to hear the names of some of these folks. Yeah, I don't want a name named because I want that like you know, some of these people I'm friends with, and I'm like, I know you're

Wives and your families and I don't want you to like suffer like I don't want to see you sort of suffering in that way. You just want to kill them. Uh but like What Yes, I do want to kill that. I I uh look there are very few people I would ever invest again with in real estate Twitter. The one exception to that rule, I'll maybe exception rather than the rule itself, is Moses Kagan, where I've invest in several deals with him and I'm like This guy underwrites conservatively like I underwrite.

Um, and he's like thinking about the game in a long term way where he's like, I want to manage my reputation. I want people to make money, I'll make money when people make money, and I would invest with him again. In a lot of other deals that I've done with ri people on real estate Twitter, I'm like, I would need uh, you know, I would have to be Uh heroin addict to invest with you again. You said last time you were on the podcast, uh you did a pie chart Um Which normally people do as percentages and you did as dollars, which I thought

Was such a boss move. And really enjoyed. So I want you to tell me how it's changed since then. So you said at the time this was Twenty twenty two, mid twenty twenty two. So it's been about a year. Um since then, a little more than a year. You said I got ten million of pri in private equity.

Forty to fifty million in cash, which is short term bonds. I'm waiting for bond prices to come up. You said that was so smart. Twenty five, thirty million in real estate. um that we own and operate ourselves and then ten million in real estate as a LP in other people's funds. You said ten million in startup investments and ten million in the stock market.

Um What do you has that changed? Have you have you made shifts since then in how you are investing? And we should put that in a pie chart on YouTube just so people can follow that easier. Yeah, sure. Um good question. Uh It hasn't changed dramatically. Um I'd say the forty to fifty million dollars in bonds is probably somewhere at sixty to seventy today, but it's still in short term bonds, which are yielding a lot.

Uh I'm starting to get a little bit longer as like the yield curve starts to flatten. Like right now, if you buy a one year bond, you'll get about five point five percent interest. Uh in a year. If you buy a ten year bond, it's a little bit under five. Uh you know, a year ago it was like Five it was let's say five percent for a year, but four percent for ten years. And now the the what the curve was inverted and now it's starting to flatten a little bit. And as it continues to flatten, I invest in longer term bonds rather than just short term bonds.

Uh I probably have fifteen to twenty million dollars in the stock market at this point. uh heavily concentrated in Facebook and uh uh and Shopify. Uh probably like and probably PMG. You tweet out this funny thing you it was uh your your IRR versus uh S P and you're like Uh you quoted you quoted legally blind. You're like what, like stock investing's hard? It's hard. And what were the what was the returns? What was the comparison?

I'm probably up thirty percent for the year. Yeah, versus S P was like Three or something or or ten, twelve or something like that. Yeah. Uh but yeah you didn't say what you owned, and in my head I was like I bet that is literally just Facebook. Yeah. Yeah, it's it's a lot of Facebook. Um Facebook and Shopify.

And PC You and your brother kept buying the dip. Like Facebook was getting crushed like uh you know. Yeah. I don't know, a year and a half ago to to like you know, up until six months ago or something. And um Every time it went down I remember your brother and I think you also were like Uh hey, is everybody insane? Uh great. I can't wait to go buy more Facebook today. And the earnings and psychologically it's hard, right? Earnings come out or or um you know, big stock move happens, it goes down.

And to be like, All right, woo, let's go, but let's buy in more. Buy in more. That takes A totally different mindset. Uh what's your what drives the conviction? Because it's obviously not A reaction to the Reacting to momentum. In fact, you're growing you're betting against the current momentum. So what made you believe that that's like A place that you wanted to be investing.

Um, I would say two things. One is literally every single pr business I know, if it's an online retailer. Is entirely dependent on Facebook, whether they realize it or not. Like anybody and look the best businesses in direct to consumer are entirely dependent on Facebook. The worst d businesses are diversified. And it's that simple. If you're entirely if you're like my business lives or dies by Facebook, I'm like, you're gonna have a better outcome than if you think your business lives and dies by Facebook. YouTube ads. Brick and More actually, Brick and War is an exception to that, but like YouTube ads. I'm diversified with my advertising strategy. I'm investing a lot in TikTok.

That means you can't get the thing that works for everybody. And is the biggest advertising agent in the world to work for you, you're gonna miss out on a ton of opportunity. Um and and so I'd say that is one of them, but like The reality is, and this a little bit of a longer story. When the financial crisis hit My father who had been conservative his entire life

He was probably like seventy years old at the time, and he's like, This doesn't make sense how cheap these houses are. And so um he bought one house And um it was probably like a fifteen hundred square foot house and he paid a hundred and fifty thousand dollars for it and it just sold for like two twenty five. Oh like you know, a couple months before end he's like, there's a seventy five thousand dollar discount after sixty days. And then the next sixty days later, that one fifty was probably worth like seventy five thousand.

And rather than get scared and be like, Oh fuck, I lost seventy five thousand dollars and we don't have a lot of money at that time, he's like, This doesn't make any sense. U now this house over here that sold for two fifty four months ago is for seventy five thousand dollars. And so we kept Purchasing real estate. And um

You know, there was one half duplex that he purchased for eight thousand dollars and it generates like nineteen hundred dollars in rent a month today. Like within uh you know, within a year we purchased back the entire duplex every single year. And uh he never lost conviction. He's like, This is a deal of a lifetime. And um I've got the conviction that I'm right here. And uh you know, uh honestly, you know, people talk about my brother and I and how we've like uh had financial success.

The reality is that financial success is based on the idea that we will not need a lot of money in the future because he per he started purchasing real estate and created a steady stream of income for our family that would be very hard to lose. Uh, we have the benefit of that. It's sort of the solid foundation of like not worrying about money and sort of being able to take a lot of risk. Because we could fall back on real estate. Um, and that gave me a lot of conviction where I'm like, wow, it it is possible to buck the trend here and say, you know what, these people are wrong. This like, you know, this is on sale and you're selling this incredible asset and it's fifty percent off. And I know it because I'm looking at, you know, 25 ad accounts on a daily basis and seeing that these people are still investing ad dollars on Facebook. Um, so how could it be twenty five how can it be twenty five percent off? How could Facebook's not be fifty percent off? This is a buying opportunity, not a selling opportunity.

Of your uh portfolio now, what percentage of it came from native? Uh was did native make up the bulk of it and then it's just has grown nicely since then? Um I would say native is uh you know. It it's hard to answer that question'cause like n a lot of the so when native sold, uh, let's say I I made virtually the entire amount. Um But that you know, like the the my net worth is significantly higher than that now. But like you know, it's based on like you know, I wouldn't own

Fift million dollars in bonds were it not for the hundred million dollars I got from native sale. So like yeah, while the interest is I don't know if the interest is attributable to native or if it it is not. Presumably it is. Um you know, certainly if I were getting a divorce and I didn't have a pre knob, I'd say all of this is native money. Like it all came from native. That's pre uh pre marriage.

Uh and so um Yeah, the the bulk of my uh financial net worth as a result of selling native, but at this point The cash itself from native is probably less than a majority of my notebirth. When you um

You talk about like Oh wait. Your dad saw that opportunity underpriced when Facebook stock is crashing, you feel like this is a better priced asset. Um, what do you feel like are the kind of underpriced opportunities or assets today?

I think San Francisco real estate and possibly office real estate in a lot of other cities. But I do think that like um That unlike you know the c the question is how do you want to get in there? Um When when we were bought when my father was buying this real estate in 08, I was an attor it must've been like a little bit later, actually, must have been like twenty ten. I was an attorney. And uh all these like wealth managers try to talk to attorneys. And so I was like, look, I need a loan

Um, for five hundred th My family needs a loan for five hundred thousand dollars. We bought a million dollars of real estate. We just want fifty percent L TV and Wells Fargo would be like the only way we're gonna give you a loan is if you give us a million dollars in cash, then we'll give you a million dollar loan. And I was like I don't understand if you guys know how money works, but if I had a million dollars in cash I wouldn't come to you for a fucking million dollar loan. I wouldn't give you that. Um But so anyway, like we were str we were strapped for cash and trying to deploy it. And then what my father did is he dollar cost average into the real estate.

Uh and he didn't know that that's what he was doing. He was just like okay, we got like another, you know, fifty thousand dollars to spend, let's go buy a house. And um he would get that fifty thousand dollars for rent that he was collecting. And so he just dollar cost averaged his way in and it was really aggressive. Um I'm if if you were dollar cost averaging your way into office space, I'd probably start You know, in twenty twenty three or early very early twenty twenty tw four.

If you were like I'm trying to time the bottom, which is really hard to do correctly, obviously, I'd probably still wait four to five months. 'Cause there're probably still some uh, you know some deals that have to go Oh, that have to light on fire before the rest of the w world realizes okay, my real estate is now worth a hundred billion. It's actually worth thirty million today. Yeah, I I agree with the San Francisco thing. What do you think? What was your answer to that question? I didn't have an answer, but I wanted to know your opinion on like uh some of these D to C companies that have just got smashed in the stock market. So like, you know

An Albirds brand, which I don't know what the market cap is, but it's like fifty million dollars or something. It's come down. I'm way, way, way down. Revenues over a hundred million. Market cap. You know, 50%. Today is 138. Yeah. No, I think you have to go bankrupt before you can touch that. And wh why is that? They just totally mismanaged it, or it's too much debt? What's the problem with that? that business. I I haven't looked at it. Uh probably like real estate uh is probably not good. Their team is too large. They might have some f like financial obligations probably to their suppliers that are really holding down their they have a lot of accounts uh payable

Um, and you need to wipe that all out before you can get into it. I I looked at this with honest as well, and I was like, um I talked to some serious people and I was like, Hey, I wanna buy I'm thinking about buying honest. Um, and uh that business was that business had different problems. That business had gross margin problems, which was They trip if they sell a diaper for a dollar, it actually costs them seventy cents. And generally in this industry, you it actually costs you like thirty cents.

You should have, you know, sixty, seventy percent gross margins. These guys have thirty percent gross margins. So they had the they had a different problem, but like um I I think with all birds it's a it's more severe. It's uh you know, it's systemic, it's a brand uh like you know it's a brand like It's I think it'll have to go through bankruptcy in order to be uh fixed. Do you look at things like AI? Do you pay attention to it or are you just like, I'm a merch. I used to cash checks at a gas station.

And so deodorant uh you know through Facebook ads and now you know I you know, are you like Real estate, you know the only things I can touch and feel. Or do you pay attention, do you get swept up at all in the kind of the crazies of of the day? Like AI. Um, I think I get swept up a little bit, but I'm probably more cautious where I'm like, I want to see how this thing makes money. Uh I remember our last podcast, Sean, you were like

How much do you have in Bitcoin?'Cause that was one thing on the pie chart I did not talk about and I was like, you know Probably less than five hundred thousand dollars. And today it's you know probably probably less than two hundred thousand dollars. Um You know, I like to know how I'm gonna make money, and I guess I'm far more risk averse than most entrepreneurs.

Um, and that risk aversion means that I probably won't invest in businesses unless I have a good idea of like how does this business make money or who who purchases this business or how do we how do we exit this business. Five to ten years from now. I need like a realistic vision of that. If I don't have that, I'm probably less inclined to get behind it. And so I think that's made me shy away from Bitcoin. That's made me shy away from AI. Probably to my own detriment. Are you managing everything yourself? And what tools are you using?

Is it just a a sheet? Just a Excel sheet. Yeah, there's a Google sheet my brother and I share where we're like here's the investment. Like, you know, if it's a you know, here's a fund, here's how much we've uh committed, here's how much we've invested, if it's a startup, it's here's how much we put in. Do you do you guys still have like one bank account? He told me once, he was like, Yeah, it's kinda just like a family pot of money. I'm like, how's that one?

A little bit, uh a little bit, yes. Uh is the honest answer is yes, still uh in v in very many ways. I think the answer is yes to that. Um When you see him buying something stupid, you're like You're spending our money, bitch. What are you doing? Well, I knew he was gonna buy you a gift one time and I was like Well, he's kinda buying himself a gift, right? You g i i if it's it's our money. Uh you you don't like you don't like wealth managers. Uh so do you manage everything yourself?'Cause that's that's a full time job almost. That is a full time job if you want to be good at it. And if you don't get like if you don't want to be good at it, it's less of a full time job. Like At this point I'm uh mostly content with if I'm not making a startup investment

I'm generally gonna think of uh the S P five hundred or a US Treasury. I'm not like chasing the extra yield, um, where I'm like if I put a lot of effort into this Instead of the US Treasury, maybe an Uber like Uber bots that are dated in twenty twenty five. are paying six point two percent But you have to analyze what's the tax implication of this Uber bond versus a US treasury to to determine net yields.

Uh I'm not like that. Uh I I'm just like giving the US Treasury the extra one percent yield isn't worth it. I'll go make a percent elsewhere. Um my wealth managers I've been through a several now. Um, I've been through Goldman Sachs. Goldman Sachs, you know, uh I would like Golden Sachs is like always consult us before you make an investment. We'll just give you our real opinion. And I did that for a while and I was like, Okay.

I thought you guys were just gonna be like is this a good idea or a bad idea? But they're always like no give us the money instead. Uh I used to tell the story I I told I I told I went to like my Goldman Sachs's uh like my wealth manager's boss I'd come over to the native offices and I was like, Look I believe that if I told my wealth manager that Bill Gates was ready to give me a billion dollars tomorrow. If I let him borrow this pen, and he signed a contract to that effect. And put the billion dollars in a briefcase and give you that give me the briefcase?

You'd say don't do that deal. Give us the pen instead. Like uh they would not They would look they would not let you loan a dollar to Bill Gates if he was gonna give you a billion dollars tomorrow and he prefunded the billion dollars. They'd say give us the dollar and we can do better with it. Oh, let us earn fees on your dollar. Don't take the billion dollars. Let us earn fees. And I told my Goldman Sachs wealth manager's boss, I was like, This is how I feel at your organization.

It is fucking horrific. Um and uh you know, I still feel that way about that. Uh like you know, I'm still angry at them. Um then I went to this. Yeah, yeah. I'll I'll tell uh You know, she was like, Wow, that must be awful and I was like, Yeah and I was like you know I was like if I had um people working for me that made me that made my clients feel like that, that made my customers feel like that, I'd want to know. And that's why I'm telling you today.

Bill one of the funniest tweets I ever saw was you go Oh, here's a photo of every uh three PL owner that I've ever seen. And it was a picture of the hamburglar. It was so funny. It was so funny. Oh my God. I and I couldn't even imagine What you were going through that would get you to the point where you're like, I'm gonna tweet this out and where's a what where's a picture of the hamburglar? clownishly criminal these guys are with how they rip you off. Uh so funny.

My last wealth manager um was like uh about a year and a half ago was like you should invest everything into uh bonds right now. We think the Fed is gonna engineer a soft landing and everything's gonna be perfect. And so you want this three you'll get a three percent yield if you invest in a five year duration. So basically that you'll get three percent a year, but you have to commit to without money being invested for five years. And um So I put like uh I think it was like five or seven million dollars to that and uh against that strategy. And then a quarter in, like probably three months later, I was like, you know what, I don't believe in this. Sell everything right now. I'm gonna take a loss. I don't think we're gonna engineer this soft landing. Interest rates are gonna go up, inflation is nine percent. The fuck are you guys thinking that we could engineer a soft landing year with it with interest rates staying the same as interest rates remaining the way they are and inflation being nine fucking percent.

You think that I should get a three percent yield? And so uh we sold the seven million dollars. I probably lost a hundred and fifty or a hundred twenty five thousand dollars or a hundred fifty thousand dollars in that three month period doing this. Three months lost$150,000. Because I bet I guess then it you know, people started to realize interest rates would rise. And uh since then I've just invested in like, you know. Three months six months, one year treasuries um to t take advantage of the yield.

And so like you know, these gu the guys who are the wealth managers Their job is not to understand markets. Their job is to understand Um how to sell you an asset. They're just car salesmen Who sell k like, you know, financial uh instruments rather than cars. And they're like just as sleazy and just as like slimy and just as charismatic as well.

And um You know, I trust you know, uh have you seen like Seinfeld where George Costanza is in a car dealership and a car dealer's like walking towards him and he's like, Stop right there, or otherwise I'm gonna leave. That's why whenever my wealth uh manager was like, Let me sell you this asset, I'm like, Stop right there. I'm the hang up the phone if we continue this conversation. VOO or you know, US Treasuries. Don't try and sell me anything else. I know how you guys think. One time they were also like, We're a very large LP in Forerunner Ventures. And I was like, look, I understand direct to consumer better than a lot of other people. Forerunner invests a lot of direct to consumer.

Uh you guys are wearing that as a point of pride. I think that's a terrible idea. Don't put any of my money in Forerunner Ventures. Uh and so it's been uh it's been a fun learning experience, but it's also something where I'm like There's no one doing this well. There at least no one that I found that does this well. Everyone seems to be like here's this product. We want you to fit into this box. Put in this much money in private equity, this much money in uh venture capital, this much money in you know bonds, this much money in hedge funds. We don't give a fuck about your like you know, we'll think about your age and that's it, but that's about it. But we won't be sophisticated about this and be like, okay, you know what? Uh maybe you want esoteric assets that are more interesting. Maybe you're okay with your money t being tied up for longer.

Really like they don't understand the market. I think that's a more fundamental problem. They're not like we think the market is heading this way and we uh want to prepare you for that. Even in times of uncertainty, they're not like we want to prepare you for uncertainty. Are you ever gonna start another company again and and make that your thing? You missing it? Yes, definitely. Um, you know, I think that uh I can't turn a hundred million dollars into a billion dollars. Uh I can only start a business that sells for a billion dollars. So I think the answer is yes.

Wha what happened to the guy on Twitter who said uh Hey, money's not gonna make you happy. Uh it's your friend and your family and your what did you s what did you say you had some tweet about this the other day that I was like You do you have her ghostwriter? Who's this? This is not on brand. This is not the guy who said I was put on earth to increase earnings per share. I like the old boys. Yeah, it all could be true. It all could be true.

Right. You can he wants to get after it. You don't have to do it just to make you happy. You do it just'cause it's exciting. And I think like it all depends on the mood you're in where you're like lonely or spending a lot of time with friends and you're like, wow, this is great. And then you you know, uh I'll spend time with friends and this guy will be like, Yeah, I'm making I started this directing zebra business and doing a hundred million dollars is our second year twenty million dollar zebad. And I'm like Friendship. I need to get that. Uh and so

I think it's all like the grass is always greener. Um And so sometimes I'm in the like Yeah, I had this other two where I'm like, sometimes I want to be like a warrior and um make a lot of money, and other times I want to be like a civilian and um just spend time with loved ones. I don't have a good answer to that. I see a therapist and she doesn't have a good answer to that for me either. Hey, no, there's uh what is it, Sun Tzu. It's better to be uh a warrior in the garden as opposed to a gardener in war. So uh you know, you could still be this crazy person and chill every once in a while.

That is a great quote, I've never heard that before. That's awesome. What are business ideas that you guys have? What about what's a business idea that I should start? You know, if I want to start a business, what what's what you guys talk to a lot more people than I do. What's a business idea I should start? Yeah.

My honest opinion is that You now have new advantages and so like you could start a new business from scratch. But I really do think the thing you should do is Take a huge slug of capital. buy something that is like, you know, already worth

Hundred million dollars. Like you could you could take something from a hundred to five hundred or a hundred to a billion. Much easier than going from zero to five hundred. uh with like a new product in the marketplace. And so I I think that's what I would

That's where I would start the process of thinking uh thinking about it. I think you'd be very successful doing that, or or buying like a I forget the guy's name, Nat Not something, the guy who bought uh the trading car company, like like an old uh what was it called, Sean? Nat Turner, is that his name? Uh Nat Turner. Yeah, he bought like a trading car company and he's like, I'm gonna make this cool again. I think you would succeed doing that. But my read on you is that you are significantly more of a creator and an artist than you want people to think. And I think that you have to'cause I I saw how like careful you were about customer service and about the brand. And even though you want to act like this tough guy, like you are like I'm gonna answer two hundred customer service emails and I'm gonna like delight them. And I remember about the website, like you act like oh I just copied this, I copied that.

There's a lot more thought and care than you a l than you give that vibe out. And so if if if I had to tell you what to do, it would be uh start something from scratch and make it art. And then also have that fifty percent of you that You know, only cares about Ebida or you know, or whatever, uh the I I I my opinion is of who you are is you need to be a little bit more of an artist than you have lately. I couldn't agree more. I appreciate that. Yeah, I I actually agree with that. I I also think uh

What I would not do is I would not do another D to C brand, even though you know how to do it and you could do it like, you know, in your sleep at this point. Um just because you're playing the same level of the video game that you you already beat and like You know, what's more valuable than the money you would make in that is like You have like certain number of years of like you're you're in like peak mental physical like abilities right now.

And like use those years wisely. Either go do just the funniest things you can think of in around the world and travel and do all that good stuff. Or if you are going to do a creative project. Make it one that like it you know, puts those to good use and to good challenge. You know, like If you s if you came to me and you said uh like you know

I'm starting another D to C brand and it's gonna be um, you know, not deodorant, but whatever. Some other thing. Yeah. Uh yeah, I would be like, Oh yeah, that's cool. You're I'm sure it's gonna be successful, but Um, I don't think that's what m will make you more sense. That's bullshit because native deodorant Like I use the soap because like I trust the brand like he built a brand. I mean it's a it's a trusted brand. Uh partially because I know Moyes, I don't know the the owner now, so I don't I don't know actually if they're sticking to what the prom You don't know Proctor? Well I I don't know if they're i actually it's the opposite. I think if they own it, they're probably gonna ruin it.

Uh, but like if you were to create like some type of food that is a healthy option or something baby formula that's a healthy option, I actually think that that would start and look silly, but it actually has massive implications and would make I don't like saying this, but it could make the world a even a slightly better place and you could find some fulfillment in that. Uh and it would look just like another econ brand, but as long as it's not like something stupid that doesn't that doesn't matter to people. Like, for example, another Allbirds thing, but something that I put in my body. uh, you know, or something that makes my kid healthier, something like that. I I I think that could fulfill you. I appreciate that. And I appreciate that inspiration as well. I think there's uh truth to both those things. Like I I wanna Build something bit like

One of the reasons that I haven't really gotten excited about anything is because I want something to be, you know, ten times bigger than my last business. And that's um Yeah, that's hard to do and hard to be excited about and hard to say, you know what, I'm gonna spend the next ten years of my life building this business. Um, and that's uh you know, that's what's made me really cautious about it, but in a way that I think is Um, you know, making my mind less flexible than it was five years ago. Well, you better get on it, man. You don't want to be a has been or a one hit wonder.

I I I I think I think that native is only it's a home run for everyone else. I think it's a base hit for you. Um, but I'm I'm like every day I'm like What's he doing? What's he doing? Is he doing it? I'll see you tweet something up like Is that gonna be the thing? Is that gonna be the thing? Is he gonna actually fall in? You know? You're gonna be you're gonna be like Uncle Rico bragging about how Yobos took state in high school. Like I w you know what I mean? Well, hey, look, that's great. It's not a neg. I I'm saying you're you know it's Oh, it's a compliment. Look, it's a compliment. I you're gonna you're gonna do great things, but whether you're gonna finally nut up and actually do it, uh, and that's what I'm eager for.

Yeah, yeah. In fact, my our our my banker from uh the native sale texted me yesterday and he's like You know, November eighth is the sixth year anniversary of the sale. And so like it's been six years since I've been out uh, you know, sold the business. And you know, I think so far it's been my bad mopus. Hey Moys, you wanna stop good. You wanna feel some anxiety today? It's been six years. You want to fuck up your day? Here you go. You know what that is? He's doing uh home options for investment banking. He's like texting me once in a while and be like, Hey, when it's time to sell this in your next business, don't forget about me. I'm still texting you. What was the um what what's the sales now of native? I bet you that's doing two or three hundred million a year now, right? Five hundred this year.

Five hundred. Oh Culda, wulda, shoulda. No, I'm I'm I'm joking. You I would've sold probably as well. I don't think I could have done Yeah, I don't think I could have done what P and G has done without that. Like they've made it an amazing brand. They think about like um you know product development, they think about shelf space, they think about

Things in a way that's really spectacular. And I'm not to say that there are things where I look at'em I'm like Ooh, I wouldn't have done that. Like I definitely see that once in a while. But ultimately, like um You know, the reason that I sold the one I did was I wanted to learn from people who are masters at something about how to grow something from, you know, thirty to a hundred or five hundred. And I think I learned a lot of that while I was there. And so you know people always like do you regret it? I there's not a day that goes by where I go to bed and I'm like, Man, I should have told. I'm always like that was the right decision. We'll wrap up with this one line that you told me, um

You you were you were saying uh you were telling me about the sell the sale process and they were like So how are you gonna expand? And you looked at him all dumbfounded, I go Are you and you go? Well Can you write the words native on a shampoo bottle?

How how about on toothpaste? Can you write that? Okay, that's how you expand. And that's exactly what they've done. I actually don't use the deodorant, but I use the soap. You uh the soap is my favorite. You you've even had like Melissa's cupcake soap and you have all this other soap. I I I love the soap. And so uh your uh body wash. Yeah, yeah, yeah, yeah. Yeah. Yeah, yeah, and your uh body wash and you um your smart ass reply. was their strategy and it worked. So congratulations. Yeah, he's gotta call someone, hey guys, can we write native on this bottle? Can we do that? I remember that. Right on. Uh Boys, thanks for coming on, man. And we appreciate you coming on. Thank you very much.

I feel like I can rule the world, I know I could be what I want to I put my law in it like my day song On the road less travel never looking back

What you see above is a preview of the first minutes. One unlock costs 3 credits and covers this episode forever: full segment and word-level timestamps on this page, plus .txt, .srt, .vtt and word-level JSON downloads, as many times as you like.