#53 - Nicotine Gum, Dating Apps For The Elderly & Tax on Vested Shares

What up? What's going on? Um Did we ask people to subscribe and unsubscribe? Did that work? I don't think it worked. Uh we got a bunch of videos of people doing it. Thank you for doing it. In my opinion that

Experiment doesn't like. Uh it doesn't move the needle too much. I don't I don't know if that technique is a is a big thing. Let's uh answer all their questions um Do you wanna answer him today or I think next epis uh Thursday because I didn't have'em I don't know. I got a lot of them. Yeah. The problem and I apologize to people who send me things on Instagram, I don't check that ever. Oh yeah, I didn't know. You know there's two inboxes on Instagram? Yeah, Facebook always does that with their show. So I didn't know that that was even a thing. And I had all these nice people sending me reviews to find it like a year later. Yeah, and I didn't even know that. So apologies.

Um I listened back to one of the episodes, which is uh the most uber uncomfortable thing you could do. I've not listened to one ever. Yeah. And I don't blame you. I listen back and um You know, you were saying you're very self conscious now with'cause we do the video and that's how I am about the audio. Because I listen to it and I'm like Why am I talking this fast? Why am I breathing like that?

I think no, I think you have a got you got actually have a great voice. I think you have good cadence and someone at one of the meetups asked me, he goes, Do you guys cut out Silence. And I was like, On the audio we do. But you do? Oh, I thought we didn't and he was like, You guys are talking so fast. Yeah, so he he cuts out. Ums, ahs or big repetitions, like if I say the same thing two different ways for no reason.

Um and then I think he cuts. He's like a perfectionist. I told him not to do it because it takes him like six hours to do every time. He's like, it makes a difference. And I was like, I don't know if this shit makes a difference. I got compliments from it. Okay. All right. Well he's gonna justify it now. That's crazy. I just thought we were talking fast. No people like the We do talk fast, but it's the in between where he speeds it up and then he cuts out any like Extraneous. Bullshit. People like it. You know I I also got tons of compliments from Stu a few episodes back, and people liked him. People like Stu.

Yeah. High approval rating. All right, what do we got today? Uh speaking of presidential, uh did you want to talk about Bernie? Is that your first thing up here? So a bunch of people on Twitter were freaking out because Bernie's proposing this tax on vested shares that you haven't actually Cashed in yet. Okay. And tech people were like, Oh, okay, there goes the start up scene. Like

Well, you know, if you're gonna tax people on vested shares that they haven't actually received the prop like This company's not liquid. And so but there are some nuances, like I g it's written here. It's tax on non qualified stock options of at least a hundred thousand d you know, if you have over a hundred thousand in stock uh stock options That are vested and your employees making at least a hundred thirty K. So it's not everybody And it's not all types of things, so it's not RSUs. It's ISOs, I believe. Okay, so I'm not an expert in this stuff at all. I'm not an expert in politics. I know what I believe, but I don't know the technical details. So we'll let's agree to talk out of our ass for two minutes. I'm not gonna talk about that actually, but here's what I am gonna talk about is starting a company and how it worked with us and

A lot'cause I do know that a lot of people think like oh the rich are doing this. They don't understand things. So when we started The hustle. I saved up twenty five thousand dollars to start it. With that twenty five thousand dollars, I made sixty grand in profit in six weeks, which is pretty good. And the first year in business was roughly three hundred and eighty thousand dollars in revenue.

And most of it was profit because I paid myself uh we were in think we were in L C. I withdrew two thousand dollars a month in Salary. Um and that's how I paid my bills. My rent was cheap. Very cheap, hundreds of th hundreds of dollars a month.

Um and I lived off twelve hundred dollars um Beyond that. Beyond that. I was very I lived very, very, very frugally. Um And then we decided to raise a little bit of money. I raised I think three hundred thousand dollars from people at a three and a half million dollar valuation. And you had to change from being an L C at this point, right? Yep, change to be from uh an S Corp, I think.

Probably a C Corp. I don't remember. I see this is I'm not an expert in this. Yeah. Um You want to be a C Corp if you're going to take investment. That's just like if you don't have to study all the differences between them, but if you're going to take Like traditional investment, they're gonna want you to be a C Corp. So we converted. It cost five grand to do that. At this point, we probably had half a million dollars in the Three hundred thousand dollars in the bank account. I don't I don't remember. Between three hundred and five hundred thousand by the end of our first year. Uh

And We raised money at a three and a half million dollar valuation. And then once we started doing stock options and stuff like that. We signed up to Carta and they gave us a uh What's it called? The four oh nine A? Yep.

Where we got um So that four nine A just values your company at some number. You guys had revenue, so they probably took some standard multiple range. And you want it to be low at this stage. Yeah. So they valued us in the millions of dollars of range. I I don't remember. It could have been three and a half. It could have been six. I don't remember the number. Whatever these types of businesses are, that's what they value. You want it to be low because that's what your share price is get that's what your stock options are gonna be if you're an employee. Uh you wanna get in at the sort of low valuation. So when it sells at a high valuation, you get this sort of uh increase in value. But if they If the four oh nine A comes back high Then um You're not gonna get you know as much of a lift on your share price. And so at this point our four oh nine A is many tens of millions.

Um Which is nice. That's a cool we have a valuable business. Um But when we started it was single digit millions, which was still a lot. I was twenty four. at the time. I I said I started with twenty five thousand dollars and I was taking two thousand dollars a month. I was not saving any money. Right. Okay.

Um I'm not complaining'cause it worked out. But So On paper, I was a millionaire, multiple millionaire. If I had to pay

Um I think th I forget what this I don't want to like act like I know I'm talking about. I let's say if I ha if I had to pay twenty percent in taxes on that multiple millions of dollars you wouldn't have had I literally wouldn't have had any money to do it. Right. Even if I wanted to withdraw money from our business account. I would have had to lay people off or I I like so when people say S certain people are hoarding money or something like that.

A lot of times it's not true. And I have a lot of founder friends that have businesses that are on paper worth hundreds of millions of dollars. Right. And they have tens of thousands of dollars saved. That's bank account. Yeah. They're not liquid. Yeah, I think people need to And this also happens if you're an employee. Um you leave a company, you usually have what they call an exercise window, which might be thirty days, sixty days, ninety days. Um I think that I think the normal ninety days. Um that gives you three months to come up with the money to buy your options. Or you lose them. Yeah. And a lot of people don't have that money'cause like, you know, they they leave one company, it's a startup, and now their shares are worth eighty grand or hundred eighty grand. They go, they want to go do a different job. And um now they need to come up with eighty or a hundred eighty grand to buy out their options. That's not still a guarantee that that money's coming back. And often people don't have that money sitting in the bank, so they'll forfeit their options, which is a a true bummer. Some companies are being cool about it, Pinterest, uh

I don't remember, maybe Stripe. They increase their exercise window to seven years or six years. That's crazy. So they're like look we know this practice a little bit crazy. Um it's hard to come up with that cash. And you worked here, you earned your share, so we're not gonna try to take those back. You have the longer window because we might be private for longer, which is kind of a cool trend. So my W company should do that. My W two income. So r at this point I make money in eight or ten different ways. I got loads of things that just

It just has added up over time. And That's great, and I still pay myself a salary. I pay myself Um Not that much. N I'm not the highest paid person here. Yeah. And

I Um, but my W two salary I we're gonna be four years old, uh I've been working on this as a project since two thousand fourteen. We're gonna be four years old as officially in April. I uh Oh next month. I uh

My W two salary in year one, I think was twenty four thousand dollars. Year two, maybe Thirty six. And then year three then I started go uh going higher. Right, because the business was established at that point. But my W two income historically has been low. Right. Quite low. And so when I saw this and I saw People getting mad at rich people, I'm like

I bet people thought I was rich. Yeah. And you wouldn't have qualified for this because it says you have to be making at least one hundred thirty K, but uh like thirty percent tax on my Stock now. It would be painful. Fucking hard. Yeah, you'd be in a really tough spot.

Y you know, Bernie I like Bernie, but this is a little bit crazy. This will really screw up uh the way the start ups ecosystem works, but it can also adapt. I'm not even gonna take a stand up. I think it's crazy or not. I just am giving a perspective of My business and I bet and and I think I I now I think I have a lot more cash than even most people who have companies that are huge. What's your biggest regret in the way you set up or organized or structured the company? I wish I wouldn't have raised money and I would have just owned it all. And why's that? Because I

Would be greedier and richer. You didn't end up needing that capital. It's hard to say because it worked. It worked. Um

If I wanted to start fresh again, I would have been able to do it. I can start now. What about advice? A lot of people think, oh, this person's so successful Right, you raise money from a bunch of cool, smart, successful people, either in media or not in media. Yeah, so that was helpful. Was that truly like so did you get your sort of values worth on the advice component? Because I don't I'm not sure that That typically plays out that way. But I think you're look, our network

It's so fucking powerful. Me and you, our network is so powerful. I have I think thirty five investors, ranging from Tim Ferris, the founders of Nerdwallet, which is Who knows what that's worth, billions of dollars. Um Um the founder of the Chive. Founders of bleacher report. Um who else?

Um Just look it up. A lot of people. And I text them. I just text them. I'll say.

You get a lot out of and I'll tell you two things that you do that gets a lot. First, your investor updates, which you send you used to send more frequently. Now I send'em quarterly, but before I for Monthly thirty six months I send'em every single month. Every single month. And the it was so well organized, it was basically like Um Hey, here's all the key metrics. You don't beat around the bush. It's like this is how much cash we got in the bank, this is how much we made this month, this is how much the email list grew. This is how much our open rate was. Boom. That's number one. Number two, and w how what was your second sort of thing. I d I the way that I set up I was I go numbers. I go just here's the numbers. There's no interpretation.

All right, let's get into it. Numbers. Boom. Okay, then I go. Uh And then I do things that are going well, things are not going well. I need your help. Yeah. Yes or no. Yeah, it was great. And um

You sent that to so you did the work to keep them engaged and stay top of mind. Do not under under underestimate this if you're doing your business. If there's people who are willing to help you out, you gotta find a way to stay top of mind. Um and and Part of it is you you share frequent updates and there's a very good sign if you're an investor, if you're one of your companies, stop sending their updates for a bit, uh that company is about to die or they're on their way to dying and they go into a shell. And Paul Graham has this great post which is just like Um As an investor, when you see that, you know it's time to go check in. And as a founder

Ironically, that's when you need the help the most. Yep. Don't go quiet when you need the help the most. That's when you need to be talking and asking. And uh maybe you actually won't die if you if you can keep that going. What other mistakes have we made? Um So I always regretted the um I think that the the normal way that people give out equity. is a little too founder greedy. Um so I wish I had given more equity to my team.

Um And so like, you know, basically I wish I had just negotiated it better between what do I get, what do the investors get and what does my team get. I think it was imbalanced. I think some of what the investors got, the team should have got. Some of what I had I sh the team should have got. Uh because really like the people who are there as person four, five, six Really they're taking just as much risk as you are in a in a way. Um like they were there when it wasn't obvious that this was gonna work. And so for the all stars, I wish I had given more. And next time my next company I'll do just that. I will do make sure that core four, core five people, I'll make sure it's not like typically in a company. So I I don't know exactly what the pool will be, but let's say it's let's go what what's typical. So typical company. Two co founders, you start fifty fifty.

You're gonna raise some money, they might end up taking twenty five to thirty percent of the company, um, depending on how it goes. Let's call it twenty five percent. And so, you know, as the founders you you've diluted down, you're at I don't know, my math's bad, but let's say you're both at uh what is that? thirty something, thirty five percent each now. And um And so y you know, that's where you're at. And then your team, the option pool they typically say is like ten to fifteen percent is your sort of option pool. Yeah. So the

First few employees might have like you know, the key person might get like one to three percent. And then everybody else is below that, is below one percent essentially. And I just think that's like a pretty hard skew. So I would try to get multiple people in the sort of one to one to four percent range. Uh I would try to have like my core my core team all be in the over one percent range for sure. And whether that means I take the haircut.

Or investors take the haircut. That's what I would do if it's a tech company. I think it This is very different if you're not a high growth tech company. Did you start it in San Francisco again, though? I'd start it wherever I live. And so if I'm if I want to live here, yeah, I'd start it here. Um If I wanted to live somewhere else, I'd start it somewhere else. Now you can start it definitely anywhere. So it's just about

Your preferences. I uh if I was gonna start again, y another thing that I would do is I would go and get a job somewhere and just Make like when I started I hadn't I didn't I was always self employed mostly.

Um, I wish I would have worked somewhere, maybe for a little while. Before you did it, or you mean as a s do something as a side hustle? But four. Oh, you just get the experience. Yeah, I think it would have been nice. And a s save money. That's interesting. I wouldn't have thought you'd say that. I think it would be helpful. Um The

I think if you did it for three months you'd be like, Okay, I'm done. It would have been nice. You want to talk about some stuff? Yeah, let's talk about some ideas. Okay, let's take a quick break. And let me ask you a quick question. When did Noah build the ark? After the rain?

After the flood? No, before the rain. So as an entrepreneur, Quiet Light Broker wants to remind you to prepare before you want to sell your business. You don't just sell it right when you want to, you plan your exit for six figures, seven figures, or eight figures. Quiet Light Brokerage is a group of trusted advisors that can help you not just survive the tides, but exit on your own terms, for the price you want, at the time you want, to the buyer that you want. You know, as you chart your way towards an exit, you gotta first start by understanding the value of your business. If you want to see a twenty five point checklist to see how well your business scores across the four pillars that they have seen drive value when they uh for all the sales that they've seen in their portfolio.

You can find that checklist at Quiet Light Brokerage. dot com slash my first million that's quiet light brokerage dot com slash my first million Check out the free assessment, see how your business scores. If you want, you can get a free consultation for your business as well, but no pressure, no gimmicks, no sales pitches. Uh you know, Quiet Light is an entrepreneur led organization. The founders have built and sold businesses, bought businesses before themselves. They're not just, you know, sort of quick fly by the night brokers. And they advise you to use the best data to help business owners like you reach your financial goals. So grab the free guide. It's over at QuietLight Brokerage.com slash my first million. Support the pod. Go check them out.

Run the world. I'll start there. So cool. Perfect timing. Perfect timing. So these guys have been working on this obviously before this, uh two, I think female founders and What this is is it's a digital conference. So especially with coronavirus and you've had Major, major conferences shutting down. So Facebook's F eight conference. Done.

Um I believe canceled. I believe GDC Is done. Um you know, like I predict South by South West, but this episode will air in a couple days. I bet you they're gonna cancel. Yeah, so tons of these conferences are closing. And I've always this is a great experiment because I've always wondered Why aren't there more digital conferences? Now we built a product called Blab that was sort of like this. People used it this way, a bunch of podcasters through a conference on our platform. And I just thought, hey, this is cool because you could be remote. You can be anywhere in the world. You can attend this thing. And what does the conference have? It has speakers. Cool, you can stream that online, no problem. It has like exhibitors.

Cool. You could do that online if you wanted to, and it has the networking and that's a little bit harder to do online, but you could do that as well. It's missing the biggest component though. Which is what Serendipity. Yeah, you have to engineer that serendipity into the product. That's the biggest part. So these guys claim that they sort of have recreated all of that. I don't know, I haven't used it yet. But the cool thing is we're now gonna find out because with all these conferences canceling run the world is taking advantage and they're going to all the conferences as they're saying Um hey, host it on our platform. We make this really easy for you. They have a cool model where basically it's no money in, uh they just take twenty five percent of the ticket sales. Who whose computer is up here? Can you Google run the world? Yeah, pull pull it up.

And so they've raised a bunch of money from Andrews and Horowitz d this week. A lot of money they announced it and um It's funny. Henry just Googled around the world and the Beyonce song came up, which is hilarious. Which is the Is that another song? It's what's the boy band with Harry Styles that we've got to do. What are they called? Five? Something that That's right. You could talk, Alan.

Yeah, run the world today. Run the world dot today is the URL. So live events worldwide. Anyways, I think this is cool and we're gonna find out if this is like They've been dealt the best hand for their product right now, and we'll see if they can pull this off. That's interesting. Do you think that the Um I think we should do one of these for the listeners. Like just like you did the New York meetup. I think we should just tr just to f take this for a test drive. I think we should just do an impromptu one and uh hang out with people, get let everyone meet each other. I'm down. I uh

Okay, if we had to make predictions if this is gonna work, so would say the safe bet The safe pet's always no. The safe bet's always no. Okay, but if you had a hundred million dollars, would you invest two million into this business? Uh, I don't know who these people are and I haven't played with the product, so that's the caveat. Let's say I met the people and I played with the product and I felt like they did the thing you said, which is It wasn't just a live stream of content. Or a chat room, like there was some way to engineer the serendipity of a network of the networking in a conference or the discovery of new products, right? Like so if I felt like they did something different besides just a teleconference, like live stream, then I would buy it. But I gotta feel the magic. That's a stock photo.

So there's a f Henry's pulling up a photo right now of a mug that says hustle. We use that photo. That's from Splash That. He was looking at it. He thought that they stole it. Okay. Run the world. Uh internet conferences. Uh Mm. I am going to say Fifty one percent in. Okay. All right. We'll take it. So we'll here's what we'll do. By the time this airs, I'm gonna have set up the Run the World conference. The link to it is gonna be in the show notes and we're we'll figure it out. So go in the show notes right now if you're listening to this. Well let's and uh and get a ticket to attend our conference and we'll try this out. We'll and then we'll let everyone decide. Is this cool or is this like

One of those ideas that sounds good in theory But it misses the magic and never works. Uh Henry, go to GoDaddy dot com real quick. Pick a URL. And we'll send to that URL as well. Um hate going to the show notes.

Okay. Uh either way, uh we I mean we could just put it on our My First Million Podcast dot com. My first million podcast.com. Okay. My first million podcast dot com. Do you want to charge for it? Yeah, yeah. Tickets will be whatever. I don't know. We'll pick a number. Okay. Uh we'll make it cheap. Uh twenty bucks. Twenty bucks. And what it will be is uh what will it be? We'll invite our friends. So we'll invite some of the people that we think are the most interesting. We'll we'll do a talk on hey, how do we build you know we'll we'll get we'll do the things you do in a conference, right? So a couple of speakers, a fireside chat, and then networking where people can meet each other. Okay, and we'll limit it to a hundred people?

Yeah. Okay. Hundred people. The Some amount of money. My first million podcast dot com. Try it out. All right, sweet. What else we got on the on the agenda? Um oh I have one. Scroll down. You wanna talk about some book club stuff? Yeah. When I moved to San Francisco, I started a book club called the Anti MBA. And I did it because I didn't go to a an uh an elite Ivy League school, but I was always envious of those people because when I moved here, I didn't know a single soul and I felt I always like stereotypes people as like tall

Beautiful white teeth. With Patagonias and they had like lovely networks. That's what you saw all around you. Yeah, just like these like rich White people who that's how I I like that's how I imagined it. And it it kinda was that. Um and I was always envious of that. So what I did was I create a book club meeting where we would meet every week and w we would read one book a month and I would convince an expert on the city. How'd you convince people to join this? Where'd you throw it up? I'm just uh a cold email guy. I just learned how to cold email people and I I did it online. So each week we would have

Thirty people show up and I Probably had an email list of five thousand people who would I would have to this was not uh in person, this was all online. Thirty people in person. Sieva. Yeah. Um all a lot of my best friends. I met this way, thirty people. Um my friend had an office and he let me use it. And um

We would just meet up and I would and I would read a week ahead of time and just make notes and lead the discussion and sometimes we would have an expert. Okay. And then I would send show notes or meeting notes to the list. And People loved it. I made close to no money off of it, or I don't think I made any money off it. I just did it for fun. And it was very success successful. And a lot of people said that we should make it a thing. I think it's a stupid I thought it was a stupid idea, but

Book clubs are actually kind of interesting. So there's this uh business called Book of the Month Club. It was started in the I believe it was started in the nineteen thirties. At this point it's owned by uh it was owned by Bertelsmann, which is a large publisher, a multi billion dollar publisher, and then recently uh a private individual bought it for single digit millions of dollars. Um in in the forties, fifties and sixties, this was massive. I mean it was uh uh millions of people paid for it. So it was quite a large business. Hundreds of millions of dollars probably in the sixties and seventies. Uh it's gone away once Amazon came around. Um, a guy bought it a couple years ago. And it's quite

large still and what they do is uh scroll down a little bit. What the hell? No, that's good reads. Oh that's good reads. And so Book of the Month Club now has a hundred thousand active paying customers. Wow. Which means they're in the revenue range of ten to fifteen million a year in recurring revenue. And they the founder said in an interview he uh s uh w his goal is to grow five X a year. For five next a year, nice. For the next year, not consistently. I don't know if that's I think that's bogus, but uh book of the month are is kind of an interesting thing. I suspect I've always thought that it would would not work. Now my opinion has changed. So Goodreads has a hundred million users. There's this thing called the WattPad. Have you heard of Wattpad? I've heard of it, yeah. Wattpad, a lot of people don't know about it. Wattpad, it's owned by a guy in Canada and they have four hundred employees. It's a multiple hundred million dollar year business, I believe. They it's a book club for it's not a book club, it's more right on it.

You you write original stories on it. Yeah, but it's their category is roman Middle America romance novels. So if you're uh a forty year old woman, you probably have heard of Wattpad. Yeah, but that's pretty much all they do. Oh, really? Okay. It's basically for women who it's like men do video porn romance novel says woman porn. I mean that's basically what it is. Um And so the huge business and now I'm quite bullish now on these book clubs. Yeah. Reese Witherspoon has a book club. My wife uses it. My sister uses so many people have you heard of this?

No. Some fucking thing. But Oprah Oprah had hers, but the hers wasn't on paid membership, but this is really smart. Like what you're describing, I'm like oh, this is good. And I think you gotta have um probably not gotta have, but it's advantageous here to have a brand like a Re Switzerstood or whoever, Jennifer Anison or Gwynethrow or whoever

Or like the hustle could do a book club, you could do a book club. Like I think that you have to have uh A bit of cachet to organize people around to get the energy going. That initial energy you need. You buy the rights to the book. Which is expensive. Yeah, why would you do that?

Well Because I think the margins in books are quite small. I've talked to Tim Ferris about this. He told me that he earns Um I

He didn't say that he didn't tell me this, but he told me I mean, I think that he does about a million a month in revenue off his podcast. And he told me that he this is what he did tell me, he m has made ten times more money off the podcast than all of his books combined. Right. So I I don't think people get paid a lot of money for books. So it might be a cheap asset, you're saying. Yeah, I think it's quite cheap. Um so I would wanna my goal would be to buy the rights to the book and make it popular. You know who um Have you heard of um There's this company that owns uh the company that owns Proactive.

It's called uh Got g um I know what you're talking about. It's the skincare. It's a direct marketing company. They the guy who owns it, it's a quite large business, he got his start because he bought the rights to think and grow rich. Oh really? And he helped make it popular again.

Oh wow. Through infomercials. So that's what I would do is I would want to buy the rights to all the books. Um and there's another company called Mentor Box that does this. And Ty Lopez is one of the owners, so it's incredibly Scammy. I mean like you sign up for like twenty dollars and then it rolls into like a four hundred dollar a month thing. It's like fucking stupid.

Um But Book clubs are super interesting to me. So would you do this, uh like if you were gonna do this now, how would you attack it? What would you do? So you buy the rights of the you buy the rights to the if I wanted to bootstrap it, no, you can't. So what I would do is I would look at what vinyl me please. Vinyl Me Please is my friend's business. It's a uh

probably a couple of million bucks a month subscription thing. So what you do is you give them fifty dollars a month and they send you a vinyl once a month. Right. And so I would do that, but for a particular type of category. So what I would do is I would create a Facebook group and I would say it's thirty dollars or fifth doll a month and we're gonna read one book a month. I'm gonna get one expert to come and talk about the book Uh each week or each month. We're gonna do it in a Facebook group and I'm gonna send you notes about the whole book. And what uh category do you think you choose? Would you do the romance novel? Or would you do business or would you do something? Well, just'cause I have such a network in business that I could just crush it right off the bat. But romance novels, I know this from experience'cause I've invested in these types of things. Romance novels have the have the highest liquidity.

Uh as in people consume them the most. They're like voracious readers. Five five times the number of books read. The romance category is probably one of the most it's probably the most popular category on Kindle. I bet you it is. So Okay. But if I w even slightly was interested in romance novels

I would And I like what this guy did uh buying the rights to the book of the month club for you know some a popular asset that's sort of decayed over the last thirty years and uh see if you can revitalize it on the cheap. I'm interesting businesses. There's so many books that I love that are written in the sixties and seventies, and you try to buy them on Amazon and they're hundreds of dollars because They've just been forgotten and they don't reprint them. Um I just tried to buy a book the other day. Uh. that that someone mentioned on Twitter and it was nine hundred dollars. What book? It was so I just tweeted about Agora, that's the scammy um company. Um

Uh which we can talk about if we want, but the it was all about copywriting was nine hundred bucks. Wow. Um okay yeah, let's talk about Agora. Okay. You wanna hear about Agora? Okay. So Agora is is what? It's a B to B

Mm paid newsletter company. Uh yeah. Okay, so here's another interesting company. I know this because I'm in this world and it's directly related to us. Yeah, just co yeah, just the sample. Yeah, whatever, that's fine.

Um okay, so Agora Crazy interesting background. So Agora was started by this guy named Bill Bonner in the nineteen seventies. He was a publisher. He had a uh a magazine um about money and investing and things like that. And then he decided to start uh changing how he did his marketing and he

created a newsletter that w became quite popular. Um at this point Uh it You'll see it. It's the most popular one. No up higher.

At this point They make It's rumored. To be one and a half to two billion dollars a year.

And the way that they do this, there it is. They own twenty to forty different newsletter publishers. And what they do is is they buy a ton of traffic to their funnels, their marketing funnels, and right off the bat, they'll sell you a fifty dollar product. Right. And once you buy that fifty dollar product, they now have a large database and email list of qualified buyers who are interested in a particular topic. And they typically lose money on this first purchase. So let's say that they have a book that's fifty bucks, they'll spend up to two hundred dollars to acquire you. Meaning they'll buy a ton of ads and they'll they'll lose money on you. But they'll make it up because on the they call it a back end. On the back end they sell you a two thousand dollar paid newsletter.

And this company in particular, they even sell supplements and shit. Now Some people think that they some people love them. And when you own twenty or forty different brands, you're gonna have some legitimately great products. Right. What's their best product? Money Map Press dot com.

Uh Yeah, money map press. So this is for hedge funds, for for financial traders. Um yes, some financial traders. Their their typical audience is White men. between fifty and seventy. Who th who who are conservative and believe in like the government's gonna come and like

Take your money. Um I mean that'cause like so I signed up some of their funnels and there was shit like If you go to Brightbar dot com, you'll see an ad that says like Nancy Pelosi's coming for your money. And things like that, and you sign. And it takes you through one of the Agora funnels. Uh huh. And it's a five dollar book, and then yeah, and then you'll you'll go through these funnels. Let's just get rid of the whole unethical part because you can learn from everyone. Who cares if it's unethical or ethical? It's fascinating regardless, and you can learn from it. What they're experts at is copywriting. And everyone in Silicon Valley not everyone, but you know you get the point, is all about design. It's gotta look good, it's gotta be aesthetic. Their websites are a blank

Page. with tax. Right. Not just text, but like Fucking Five thousand words. And a buy now button at the very bottom.

It's That's fascinating. That is fascinating. And I think you're you know you know that Peter Till quote where it's like, What's something you believe to be true that few would agree with you on? Yeah I feel like Y you know, you might have many, but one of them would be Copyrighting over design any day. Copyrighting over design

One hundred percent and Most people I I remember when I learned the word copywriting 'cause I was like, what is what does everyone talk what is copy? Why does everyone keep saying this? And like I literally was at work and people were like, hey can you give me some copy? I was like coffee? What the she just asked to go get a coffee for her? Like I had no idea what the fuck she was talking about and Uh, and then I sort of learned, Oh, copy means text that's gonna go on the website. And then through you I realized, Hey, wait a minute, the text that's on your website is essentially your salesman and sales gives you the money. I should probably learn how to do this. And then I went deep on it. It's the most important skill you can learn. Because I've spent years learning it.

If you just give me a blank I will I will make money until I die. Right. I will always have a job because I can do that. Now what I could do is do really unethical shit and scam a lot of people really easily. But if you know how to copyright

Do or b uh you know how to persuade via the written word? Yeah, I would say persuasion is the most important skill, whether it's through the written word. Verbally. Um you know I don't know if there's some other things. Yeah, but copyright creation. Copyright is just the form in which you learn it. Now the way that I describe it is if you're a good copywriter, you understand what motivates people, and if you understand what motivates people, you can create products that

The one that will appeal to people. Yeah. And then if you are co uh that is that's the when you do copyright you just learn what motivates people and then you just happen to use the written word to communicate. Yeah, uh when when you mentioned the boron letters and then I just went deep on that, that was like my foray into the So we'll we'll do a whole section on Did you read the Papyrus? Yes, and then I started like doing all the things in it uh because I got obsessed. So the Boron letters, if anyone's curious, Gary Halbert is his name. It's actually kinda hard to find. It's hard to find. But there's there's one link, and if you get to it, it's like chapter one, two, three, three, and I guess to nineteen or whatever. It's this copywriter who's one of the best copywriters of all time. And what he would do is He was such a good copywriter that he kinda turned into a crook. And so he would write these sales letters to buy like encyclopedias or and buy like

Fucking anything. Just shit. So the Boron letters are the way it starts, it's like he's writing to his son. He's in jail. He's in jail writing to his son. And he doesn't start off by being like here's how you copyright. He's just writing to his son and it's one by one and each one's a teaser. Every sentence teases the next sentence and every letter teases the next letter. And then by the time you get twenty deep, you're like, This guy's a master. It is awesome. So read that. Um all right, what do you got, Sean? Um couple other So I was uh talking to my cousin and um So we were talking about like m one of my cousins, he's young, he goes on dates, uses the apps, boom, boom, boom. And then like our aunts and uncles are always like, Oh my God, look at him, he's just swiping left and right, he goes on dates, it's like really foreign concept to them.

And uh so that was one data point. Okay, just kind of notice while My aunts and uncles, they really don't get it when it comes to this online dating thing. Data point two. I'm watching the debate. And um It was r I watched so much shit online

That When I watch traditional T V, first of all, it's so slow. And secondly, I start to see the commercials and I'm like, Oh, this is what's being advertised to mainstream America. Like cars and very fascinating. So like Noom was on there, which is like the diet like nutrition plan thing that they do really, really well N O O M Um we should break them down later. They advertise. But the other one was some uh it was the this gray hai woman comes on the on the screen and she's like Oh. Online dating, where do I start?

And then it's like, well, open up your browser, type www. and then URL. It's like, and then start clicking around. Like that was literally the that was the ad. I was like, How do I even get started? Like here's how you get started on my dating. I don't remember the name. Oh, come on. It wasn't like a match or you're I had never heard of it before. So I started thinking and I was like, um You know, there's so many people that are sort of in my sort of uh extended family and whatnot that are divorced and they're alone. And so I was thinking about them, I was like You know, it'd be great if they found someone, but the reality is they don't do a lot of online dating'cause it's so scary and foreign and It's not the online part that's scary. It's the expectation that you then need to go meet somebody. And so like let's take my uncle, for example. My uncle's I don't know, sixty-five years old. He

Is divorced. He gets lonely, his kids are all grown up, everyone left the house And um You know, he doesn't wanna actually like it'd be great if he met somebody who was awesome and they could just like be companions for the rest of their life. But he's sort of like

Dude, I don't want to get out there. Like last time I went on a date was forty years ago. Like uh I think I'm just out of the game. It's easier to be lonely than it is to put yourself out there. So anyway, long preamble for the idea. The idea is a a service that's for older people. Let's make it just fifty and up as a as a rule. And it's called Just talking. And the expectation is you're gonna go on here with other people who are like you are sort of single, might be alone, looking for companionship.

But it's just talking. You can't meet. It's not their real names. It's nothing. It's just somebody you could log into the computer and just talk to, either through audio or text. And you could talk to them continuously, or you could switch and pick somebody else and talk to them. But it's just companionship as a service. Um And it it's not dating. You're not gonna start going out with this person, you're not trying to get remarried. You're just getting the reps in. You just don't want to be lonely at home anymore. And honestly, you can have a virtual relationship uh you know, through this. And it's because I was also watching Love Is Blind. So good. And I was like, dude, somebody should make an app that's just this now uh off the back of this show. And so anyways, these are sort of some ideas. But learn about it by Love It, I love it, witter that's a winner. Um, what I would do is I would go and do research on the sex hotlines that used to exist that

probably don't exist anymore. Right. And I would want to learn how they worked. I bet they crushed. So I'll shout out some like tangentially related so sex outline related, but obviously. Master P used to own one that killed it. Then there's one uh a startup out here in San Francisco called Papa. Have you heard of this? Papa? Yeah. No Papa is uh Grandkids as a service. So it's just young people Uh that you that will just come over to your Grandparents' house and just do stuff for them.

Um and like talk to them, but like also do their laundry and like take out that trash. I don't know if they're doing well or not. They just launched, they've raised a bunch of money. And um because there's this huge aging population of the baby boomers. And so there's this wealth of opportunities that are for these this the largest generation of people ever in America is now getting old. And uh I f I forgot this woman was calling it the um the the grey new world and you know for gray hair. And so she's like, you know, the grey new world opens up all these possibilities. So one is Papa, which is Grand Kids of us as a service. One is Honor because uh there's a huge shortage of caretakers uh for for the elderly. And so Honor is a on demand caretaker platform that you know is on track here. Are you going with caring for old people or helping people get laid? I'm talking about just talking.

That's my idea. But I was just tangentially saying there's some other businesses that are trying to help this same relationship. What did they do? Never heard of that? No. Jack invested in it. And he says it's going well. It's called relationship hero, relationship hero dot com, and they teach you how to do online dating. Oh okay. Just coaching for online dating. Can you go to relationships? That's how it started as it might be a little bit different. For young this this would be for younger people though. It'd be for whoever.

I I think it could be I think if you did just talking and you ran a bunch of Facebook ads, you could get a lot of people to pay to be a part of a community of people Where they can have these vr online relationships. I like my expectation is you do not go offline.

I think it's great. The way the way the way that you're positioning it is is as a marketplace Those are notoriously hard to make, but once you have them they're great. Yeah. The reason why I like this is you can kinda fake it at first. Yeah. So you can just hire people. You can have some operators. Yeah. That are that are providing that companion. I think it's a great idea. So you could seed the marketplace with the operators. Yeah. Um that's trending today on Twitter.

Is it worldwide. Because of what? I didn't get the joke. I clicked on it and tried to understand it and I didn't I didn't get it. One out of three Twitter trends. Yeah, don't find it. OnlyFans, which we talked about. On OnlyFans is great business. But I love just talking. I think it I think that's a great idea. Thank you. Thank you. Thank you very much. I think that's that's a winner. All right, I have a question for you now. So Before la last week, I think maybe it was when when I was with Stu, but I T I shar this anecdote or this this sort of uh advice, which was

If you're offered a seat on a rocket ship Um, you know, don't ask which seat, just sit out and buckle up. And this is just career advice, which is if you're not gonna start your own company. Did I? Yeah. Oh I thought people loved it. What what do you mean? Well, what was the criticism? But what was what was the criticism based on? It wasn't even controversial. Just stuff like Um

Titles it it was just comments like people saying titles are important, how much you get paid is more important, things like that. That's crazy. Disagree. Hard disagree. Um Okay, so anyways. The question was that sort of that led to a different question, which is what are the rocket ships of today? And so somebody, by the way, took that idea and made a rocket chip newsletter for jobs or whatever. But beyond that, I was just sort of thinking Just my thought experiment.

Um What companies that today are worth one to five billion. Do I believe will be multi hundred billion. So what's a just as a way of phrasing it simpler. What five billion dollar company today could become a five hundred billion dollar company in the future. I say this because we have friends who bought

Facebook secondary stock uh back in two thousand and six uh two thousand seven when Facebook was valued at over a billion And today Facebook's like whatever a five hundred billion dollar company and um that you know, it was clear it wasn't going to zero. It was clear it was a thing. And the question but

You could have invested then and got a phenomenal return. And I have several friends who did. I had a friend, uh, Alex uh oh no, sorry, Josh Buckley. Who's a who's a good guy, founder and British guy? Uh Yeah, he's a British guy. He's and so he um he was telling me we were just hanging out one day and he's like, Yeah, I'm buying secondary stock of stripe, as much as I can get. And I was like, Oh, like what do you mean? Like, I'm not doing that. Why why are you doing that? I should do that. Uh and he was like Yeah, I just think Stripe's a great company and there's secondary stock available and I'm just buying it. I'm like, Well, what's the valuation? It's already like a

Two billion dollar companies like Yeah, but it's like trip's gonna be big. He's like, I think stripe's gonna be huge. So I'm just buying up secondary. And now so Stripe's valued now like twenty billion dollars. Uh so he took essentially like a no risk bet, in my opinion, and ten X his money on a private company that was It was already a unicorn, but wasn't yet on the stock market, wasn't doing like ten percent a year. You know, that's a tw ten X appreciation.

So Long story short, what companies do you think have that potential that are in the single digit billions today or less? That I that you think could be A Facebook, Google, Amazon of our generation. So a few years ago I answered this question and I s I thought it was Atlassian and I went in on that and I and it worked. Okay. Tell me about that. What do you mean it worked?

Wack then it was and you just look at look go ahead, Henry, look, go to Alassian stock. We are busy today. I I invested in Atlassian stock. I mean it's not like I like Yeah at L Uh atlassian spelled with with an A. T.

eighty There it is. Yeah, and then go to all time. I bought at last Max on the far right. I bought it when it w when it went public. So what did it go up by?

It's that's like a three X already? So I three X my money. So I bought it last year'cause I read their annual report and I was like, Oh, these guys are great. So their market cap's now thirty five billion. Yeah, so I bought it right when it went out. So that works out well. What do you think can get to the over a hundred billion? How many companies are worth over a hundred billion? Like very very few. Uh especially if you think about tech companies. So some of the tech companies that made it, Amazon made it, Google made it, Microsoft made it, Facebook made it. Um Uber did not quite make it yet.

Uh, but it's getting there. Tesla made it. Um like I think I invested in Tesla when it was at about this number five, five to eight billion. Oh really? And um now it's almost a hundred billion. And so like that's a that's a big lift of a company that it's out there. It's not a s seed saved startup you're taking a bet on. Right. It's a company that's out there. And the other way to take the bet on it, even if you're not an investor, is to go work at one of these companies, right? So like Airbnb was a good candidate. Uh now it's t value too high to qualify for this. Airbnb's like at I don't know, thirty five billion or something like that. We'll see what happens with this

But it's not in the single digit billions anymore. But when we when we moved to San Francisco, we could have done that, right? When I moved to San Francisco, I had a job offer at Airbnb when it was worth a billion. One billion. Maybe less. I don't know. There's only No, it was less. It was twenty twelve. Right. So e so let's just say it was at a billion, which it wasn't, but let's say it was. Uh y you Yeah, I would have made ten million dollars. So it's thirty five X. So even if you had just gotten a a sort of standard stock package, which was like over four years, you're gonna get

Two hundred grand. I would have mive or ten million dollars. Yeah, that's insane. And I got fired before I even showed up to work. Uh So some other candidates that I put up here, Flexport, I think is a candidate. Maybe. M Oh y oh you got some inside Intel? That sounded like a juicy maybe.

Well Ryan uh told me He thinks it's gonna be massive or it's gonna go bankrupt. Which is like how you're gonna be when you're that's how you're gonna be. So some other some this was harder than I thought. I also tweeted this out. So the most popular answers I got was air table and carta, and I pretty much disagree with both of those. I don't know. And I and I asked these are smart people replying and I was like Carta? Why Carta? We should get Carta to sponsor this podcast, by the way.

Yeah, why are they not sponsored? I don't know. You guys need a sponsor, and I'm gonna I I don't give a fuck if it people sponsor. I'm gonna tell you the truth. Carta It's The best option out there, but it still needs a lot to improve. Right. I use it, I give you guys five grand a year. I'm happy that I give you the money. Um, but it it can improve. Yeah.

So Airtable, Airtable it would have to basically replace Excel in the corporate world for it to do this. Otherwise it will not be a hundred billion dollar company. How about Gusto? That's a good one. So I think there's a lot that are in the sort of either H R tech just you need to be in huge space. I like Gusto and Rippling. Yeah, Gusto Rippling, I think.

I would bet. So other ones that I that I put up here. So stripe, but it's past this point. So Coinbase only if The Bitcoin if Bitcoin actually becomes Like if bitcoin actually is the thing, it becomes the global reserve currency. Then it doesn't have to be the largest bitcoin sort of company, the largest Bitcoin brand would be, I think. Can it become Bank of America? Can it become Wells Fargo? Yeah. But I think Bitcoin has to become that relevant for Coinbase to be

Yeah, I buy it. I buy that. Uh, open door is another one just because residential real estate is so big. So if they actually have a working model, they could become a hundred billion dollar company. I don't buy that. Because what Cause Zillow and Truly aren't that huge. Uh, they don't do what these guys do, though.

Zillow and Trillium, they sell leads to brokers. They're now trying to copy open door, so now they offer what Open Door offers, but Open door is literally buying and selling the houses. They're flipping houses at scale. Which is pretty crazy. What else? This was tough. I don't know. That's all I had. But I put this on here. I wasn't gonna talk about it initially.

But I'm like, I want to bring this up. I want people to tell me what I'm wrong about. Well what what companies I should be considering in this. But I think it's a really important question.'Cause for me, I'm gonna go try to buy secondary stock in all these companies. Okay, so I don't And if you're working, you should go work at one of these companies. A hundred billion is That's impossible. I won't even tr I'm not even gonna try to predict that because Like only like A few hundred people.

A few o a few h hundred businesses have ever probably done that. I don't know the number, but Um that's really hard to say. But If I had to make a prediction, I I I do think that there will be some new search engines. Uh and

I also think that some of the new Chrome replacements could be quite large. So Brave is one of'em. Um, what's another one? Uh replacing the browser. Yeah. Anything that are replacing browsers I think are kinda cool and could potentially be that big. I think there's gonna be a lot of browser I think if any company uh nails AR

They will they will be able to do this. But that's a ways away, I believe. How about uh Zusk? The self driving car company. Yeah. Yeah. So that was the other I I considered all the self driving car companies'cause I'm like if

If one of them becomes a success, a self a successful self driving car company, the the market leader will be worth Over a hundred billion. It's just more likely I b I believe is more likely to be Tesla or one of the incumbents, rather they'll buy one of these companies rather than th that company independently Going from where it is today, which is one billion to a hundred billion. How about this? What companies are public now that could grow that much? So I was talking to Moys the other day and we were looking at stamps.com. They were crazy undervalued and the next day we were like, Let's buy this. The next day we didn't buy in time, it

Went up fifty. Went up fifty percent. Yeah, I love that. It was coincidental. Just uh interesting stat. Over the last ten years Um if you had just brought bought the Fang companies, so Facebook, Amazon, Apple, Google Uh ten in the ten years it outperformed all VCs. Uh or sorry. It outperformed even this sort of top um

uh like expected returns of venture capital. So the public market, if you just bought the five most popular tech stocks, you did better. It was a twenty twenty four percent higher R Over ten years. Okay. Well what what's public now that could I don't fucking know. That's a great question. Um It's that's hard. You gotta really bet on industries. What you got?

Well like whoever becomes the leader in Fourth gambling. Maybe Sports betting. Sports betting. Good that's a good that's a good whoever is the number one, whatever that is. And if the legislation keeps opening up That's a good call. I would do sports betting. I would bet on that industry. That's a great call. Um Okay, we ventured off into stock tips, so I want to get back'cause we don't know shit about the stock market and that's not our that's not our promise. Uh let's tell them something else that that we find interesting. What else you got? You want to do one more?

I'll mention one other cool company that's related to stocks actually, publiccomps.com. So publiccomps.com. He's just breaking down um S one's for companies, which like a lot of people like to do nowadays, but it's just a good you don't have to do the research. This guy does the research for you and he publishes it. I like it. Let's do uh let's do a let's wrap up with made renovation. You talked about this in one of our very first podcasts. Yeah, exactly. So one of our very first ones I was like, Hey, I saw this ad. I think this is awesome idea. What it is if you don't Remember because you're not a diehard. Um Yeah. What it was is it's a turnkey bathroom renovation. So

If you want your bath so the ad was just a dope looking bathroom. And it was like if you want this bathroom, it's like five grand. And you don't have to like 'Cause what happens today? You have to hire a contractor, you have to come up with the vision board of what you want it to be, you have to choose all these different materials, then he sources it, and then it turns out and then it's like that's a one off. So they have like four designs of bathrooms. You just pick which one you want. You want the old Victorian cool looking one, you want the modern one, or you want the middle well the road one. Yeah, I always said I wish barbers were like. And here's the price. And you just push the button. Yeah, it's it's like actually some barbers do this. You go up on and the haircuts like three. Yeah, I'll take the number three large, you know. So that's what they're these guys are doing for bathrooms. I thought that was really smart. So it turns out This was not just like some random startup, this is Roger Dickey was starting this and he's a he started Gigster

Um he's he's done some cool stuff in Silicon Valley before, so he's he's not a sort of uh joker. And um they raised nine million bucks and they came out of stealth and I was like I get myself a little pat on the back. That's a good one. That's a good call. That's a pretty good call. I still idea and I also think that anybody could compete with them because this will not be winner take all because you have to be doing local renovations in different cities. Uh they announced it this week. Good job. Yeah. Uh

Can I get myself a pat on the back? Yeah. Um One of my first angel investments. Uh Lucy. Uh

Lucy Nicotine dot com I think or I don't even know what the URL is, to be honest. Um Explain what it is. People people don't know. I don't but uh it's huge. Yeah, so

I invested in all my friends in school. All your friends are buying Lucy? People are, yeah. Fuck yeah, money the bank. Okay. So one of my first angel investments, uh I don't remember when this was, three years ago. The founder of Soylent, Dave um who's my friend Dave Rentel uh Renten he started this thing And um It was bas it's basically a nickerette.

So it's New Age Nicaragua. Nicotine gum. And um He told me about it and I was like, All right, well Dave, you started soil it, so you're pretty smart. You you scaled that thing up. Yeah, I knew him well. He's a good guy. And

It's a n it's a big market. It's nicotine. So I'm like, Okay, well I mean this is Retention's gonna be good. Yeah, I'm uh I'm a nicotine user. I like the gum. I I chew the gum and I like the You chew niceret? Uh yeah, I like the I prefer lozengers, so I'll put'em in my mouth. Okay. Uh And um But you don't smoke, so you just do this just nicotine. I like nicotine. It's I don't drink and I don't smoke. It's it's it's my that's my vice.

And uh And it's a monthly subscription. Yeah. Yeah, of course you'll fucking knock that one out the park. Really smart. And they just raised a lot more money and uh so on paper, which is Completely on paper's not gonna buy me a house or pay my rent.

But The valuation went up significantly. So I got a little bit of a corner store guy has it at the front by the register and I said, Okay, whatever's at the front by the register, that's what's selling. That's what this guy knows will make a money. Is it really I've really I did I I sent Dave a picture, I was like. Uh Henry all th I asked him, I said, How well does this sell? He's like It's pretty good. It's not Jewel, but it's pretty good. Of course it's not Jewel. Are are the kids kids are buying Nick uh Lucy? Oh fuck yeah.

Money in the bag. Yeah. Pay the pay the taxes on it. Oh fuck. Money in the bag. I I think that's uh five or six X so far. I'm proud. Yeah, uh That would be a That's a good investment. I like that one. I think we're uh One of the first folks in on that one. Uh

Fucking eh. I hope it works. Um, it just for the uh I while it is awesome. I uh It is totally luck. So I'm not gonna take that much credit.

But awesome. Um Thank you. Give us a review and uh share with your friends. Yeah, tell your friends. So yeah.

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