#183 - How Course Businesses Work, How Irish Pubs as a Service is Making Millions & Profiting From Vacant Office Spaces

That alone. Is kind of like to your point here where If you're a creator with an audience with credibility. If you've done something, if you're actually good at a skill. Yeah, you can get to a million dollars a year.

A profit. Uh not just revenue. doing it as an individual course creator. Yes, and the path is Quite straightforward.

Yeah. The tactics are are simple, but uh it's basically Yeah. I feel like I can rule the world, I know I could be what I want to I put my all in it like a day song on the road, let's travel, never looking back. Alright, everyone, what's happening? We have a good episode, but before we get to it, please do me a favor, click the subscribe button. on iTunes and the follow button on Spotify.

Last week we got a ton more Spotify listens because they're doing something. I think there's like a pop up Right now that shows to people when you listen to the podcast that ask if you want to follow And uh anyway, I wanna see if that's working, so go ahead and click follow on Spotify. And then click.

subscribe on iTunes and the reason why is The more you click that, the higher we go up in the rankings, the higher we go up in the rings, the more lessons we get, the more listens we get, the more cool shit that we can do. So do that now. In this episode we're gonna talk about Course businesses. Um A course business is something that a lot of people are interested in. I think it's one of the easiest ways to make a million dollars a year. Uh, but we're also gonna talk about how companies are making a hundred million dollars a year doing it. So

Go ahead, give us a lesson. We're gonna talk all about the course businesses. It's gonna start in just a second. And make sure to click subscribe, click follow. And we'll talk to you soon. We got a lot of cool stuff going on, but how you doing? I'm good. I'm still recovering from your sick burn about my uh sweatshirt. They'll see on video. It's it's it's not that it's bad.

It's just that it would have been a lot better if you wore it as like a nine year old in nineteen ninety four. I look like a skateboarder who got his birthday present. And uh you know, a twelve year old skateboarder who got his birthday present. And then Abrayu clapped back at Sam and told him he looks like a knight who's wearing the like chain link stuff that goes under your armor. You look like the extra from the dis Disney movie

Brink. I have not seen that. Extra. Dude, I wish. That would be an upgrade from my reality. Have you, um do you read books? I can't tell if this is another burn. Do I read books? Do you know how to read? Yeah, I read books. You how many books do you read?

Yeah. I'm not. This is like real. How much do you bench press? Uh I read like I'm reading like a book all the time. Like it doesn't have one book that's going at any given time. Probably read I don't know, three or four a year. Do you um when you're reading it, do you feel like you absorb it? Yeah, I intentionally read slow and I reread and I take notes. So what I'm doing now. Instead of Like, you know how like

Do you know who Ryan Holiday is? I know about him, yeah. I love Ryan, he's cool. But he reads like Five books a week. And that's popular that people will say like for their New Year's resolution, I'm gonna read fifty books this year.

Right. Damn, that's hard. Just to do. But like Do you learn anything?

Yeah. What I'm trying to do now is only read two or three books a year, but I'm I'm like quizzing myself. I'm trying to master it. And it's been really hard. So what I do is I get a bunch of books. Like I'll buy a book every three days, probably. I if anything looks interesting, I have an unlimited book budget for myself and I've had this for a long time.

Where I just decided, okay. I'm not gonna be Well I'm not gonna have a budget. I do the same thing, by the way. It's and so I just instantly buy it on my phone. I use the Kindle app on my phone to read. I have a Kindle, I have physical books sometimes, but I'm all the phone is always with me, so I like that better.

I end up reading more there. And um What I do is I will I'll read like five percent. of fifths in a year, right? Like I will just

Pick up a book, I'll start skimming through it and uh I just assume that most books are bad. And so I d I I'm very I I do not complete Ninety five percent of the books that I read that that I start And I think that's totally okay.

The book has to actually like be interesting or grab me or say something interesting for me to Try to finish it. But then once I do read a book that I like. I will reread that book.

multiple times over the years. Like I'll reread the book in a few years. Same. I I do the same thing. I use it as a reference book and I reread it a ton of times. Um I wanna ask you uh so today I wanna talk to you about course businesses and I went down a rabbit hole and I called someone right before the podcast in order to get intel and get insights. It looks like you have a ton of ideas.

But can we start with something really easy, which is you got into an argument with someone on Twitter. That's what you have listed here. And I am you you you alluded to it. A week ago, what happened? I don't know what you're talking about. Okay, so uh All right, I'm gonna try to do this without getting without restarting the fight.

Um I tweeted out. that I said, you know, um I don't even know what I said exactly. I basically said Elon Musk and Jake Paul have um Yes. I I said I said Elon Musk, you know, sells cars and uh launches rockets and raises money and

Does all the stuff and the you know, Tesla never runs a commercial. Um, Jake Paul is like uh does the same. He's gonna sell millions of dollars of pay per views for this boxing match that he has coming up. uh without a commercial and I said the best marketers Don't spend a dime. Right, just kinda like a

An observation. It's not like obviously And also like a cute soundbite tweet. Yeah, just a soundbitey thing. Obviously many marketers spend money and they're great at it and it's a smart thing. I I do I spend money when I advertise too. It's great. So that's not really the point. The point was Some people are able to hijack people's attention in the news. I have Done very well with it. Right. So I tweet that out.

Doesn't even seem like that controversial of a statement to me. Um Move on with my life. And then a few people start comment uh a bunch of people were like, Yeah, true, blah blah blah. And then a couple of people comment like

Um You know, yeah, but Jake Paul's an asshole. Okay, fair enough, doesn't matter to me. Um And then one person who's a writer for the New York Times.

Basically says um I can't believe you I I can pull up the tweet. I should pull up the tweet because this is gonna be stupid if I uh And while you're doing that, uh the person you're talking about, her name is Taylor Lorenz. She works for the New York Times. A lot of people in the tech world and a lot of people in general. Uh really dislike her.

And I'm I I actually want to be objective here. A lot of people really love her. So we don't always want to go on the negative side. Sure, sure, sure. Okay, so I I have my stuff in front of me and by the way, I w I don't have her tweet because she now has blocked me, but Uh that's that's the end of the story. Uh all right. So I said Elon is pumping Dogecoin on Saturday Night Live, while the Paul brothers are raking in tens of millions. Just by stealing Floyd Mayweather's hat while the camera's on.

The greatest marketers don't spend a dime. Uh by the way, did you see the hat thing? The gotcha hat thing. So funny, yeah. So funny. Okay. So Um if you haven't seen it. Jake Paul's older brother Logan is scheduled to fight Floyd Mayweather. Logan Paul is a YouTuber, Floyd Mayweather Probably the great greatest boxer ever.

Not even gonna be close. It's not even a it's not even a mi uh like a real contest. It's like two thousand and one odds. Yeah, it's like celebrity death match. You have two celebrities disagreeing to go punch each other, but like one of them is actually a professional puncher. Yeah. And um And so anyways, but they have to sell the fight. So in the press conference You know, they have to pretend like, well, I'm talking trash like I'm gonna beat you, and you're talking trash like you're gonna beat me. Anyways, Jake Paul

stole the show. Th this wasn't trending very well because it's so one sided and not a lot of people wanted to go buy this because there's not much intrigue of what's gonna happen. The only people want to buy it are just people who want to see a bit of a circus. And so Jake Paul goes up to Floyd Mayweather. And they're talking shit and like um you know, I could beat you up, you could beat me up. And then Jake F

Gotcha hat. And then just took his hat and ran away like a absolute third grader on the playground. Funny as hell. Of course. F you know, to to ham it up, Floyd Miller tries to go fight him'cause he took his hat

And then there's like, you know, seventy people all holding their camera phones up. recording the thing. Just a shift. Yeah. So that that went viral. That goes that gets on every you know blog and that goes viral on social media. Some people think it's stupid, some people think it's whatever. Doesn't matter what your opinion is They got a bunch of attention from it. So that's all I was pointing out. Um and in fact Jake Paul then tripled down on it.

Which was he Uh he did the gotcha hat thing. It goes viral on social media. While it's going viral. He has his merch guy create gotcha hat hats. Uh puts it up on his store, sells out of gotcha hats gotcha hat hats. And then he gets a tattoo on his leg that says Gotcha hat.

And post that that goes viral that Jake Paul got a tattoo of the thing that just happened. So he got a r a double pump. A second pump of news uh PR out of it. So I was just pointing out that These guys are good at marketing. They're good at marketing themselves. They're self promoters. By definition, you really can't disagree that the Paul brothers

are not good self promoters. They Self promoted themselves to becoming. Huge. Anyways. Bunch of people say yes. And then a couple of people are like

Um, you know, these are pranksters. They shouldn't be labeled as great marketers. Don't set them up as anything to be emulated. Um basically like don't say they're good because people f lot of what they were saying was like People follow you they were basically saying Well, Sean, they're bad people and you're like Yeah, I don't care. That's not the point. They they could be the worst person on earth. I'm just saying I'm just

Showing that they get eyeballs. Yeah, they're effective at marketing. That's all I said. Yeah, it's like saying like a like a cigarette company could be a great marketer. Who cares if you think cigarettes is good or bad? And so this writer for the New York Times basically takes us as an opportunity to come in and s uh promote her own article in the New York Times that says I covered the story about the sexual assault allegations against him. So you you know, you really basically I I don't know exactly what she said,'cause again, she blocked me, I can't go read it, but

It said something to the effect of Um Like it's messed up to Um to promote them or say something po like to be

saying that they're good or whatever when they're actually jerks, they're bad guys, they're assholes, they're Whatever. So th this guy's been accused of sexual assault. So I kind of I don't even remember what I said back, but I kinda went back and forth and I was just saying What you just said.

I am not saying that they're good humans. I'm not saying they're great citizens. I didn't say they should be president. I said they're good at marketing. I don't really see how that's arguable. And then you know, they clap back again and said You know.

Basically you're a jerk for saying that he's good. And um And so a couple of things happen. First is Dude, I I like R Kelly can be a great singer and also a horrible human being. Yes, and so so one of them was like, you know, is there really anything to learn from these guys? Um blah blah blah. And so anyways, they're going back and forth. I and I'm I'm getting agitated at this point.

And so the New York Times writer Um she goes she said something that was like again, just like trying to like virtue signal. And I just replied. I go uh she was uh she she w she said something like

I don't think he I don't think he knows the point he's I don't think he he's making the point he thinks he's making. Talking like replying to me. Talking about me, but as if I'm like not in the room. Anyways, I thought that was like a weird way of saying it. And so I just go You are the Jake Paul of journalism. Oh my gosh. Got blocked uh instantly. Um, and you know, a bunch of people or were that got a big reaction out of people. Now

I thought this was the perfect kill shot. Why? Because That's not an insult to me. I'm so first of all, it's true. Her brand of self promoting herself as a journalist. Is confrontation. She gets in confrontations with Keith Reboy, with Bology, with Naval with whoever, right? She just goes and picks fights on Twitter with Mark Andreessen.

And so she she goes to the biggest names. She Creates controversy, picks fights. And then she Also, like then as soon as they sort of attack back, then she turns that into a story, which is

Big bad tech is bullying me. Um And so I was just pointing out that actually her form of mo self promotion is the same as Jake Paul's. He went to Floyd Mayweather. Agitated him, pink got gotcha hat.

And use that con controversy and that confrontation to Build his own brand. So I was A. Correct in the way that in identifying her own playbook of self promotion.

B It's not an insult to me. Again. I have no problem with Jake Paul. Jake Paul came on the podcast. Um, you know, I I I think this guy's a good marketer. I I think that I I don't take such a black and white look at people and say that

This person is good and this person is evil and this person is you know, like I just don't think that the world is that black or white. And so uh Anyways, I wasn't trying to insult her, but she took it as an insult, of course, because that's why it was the perfect one liner. Uh I was able to insult her without even insulting her. And so um

So anyways, that was the confrontation and then uh Yeah, I got, you know, a bunch of DMs from people and then, you know People at my company were like, Hey, can you not like pick fights with journalists and I was like okay, I'm sorry. I really wasn't trying to pick a fight with the journalist initially. Well that's pretty funny.

Um. That's a good story. I by the way, I still have no problem with her. I actually think she's a really effective marketer of herself, too. Like I know her name I don't know anyone any other tech journalist name. I genuinely think she does a very good job. promoting herself by covering interesting and controversial topics, like she cut she was covering TikTok early on. And then also

her brand of sort of like taking it to You know, powerful people in tech. I view it as an effective form of marketing. I also think she's good at it. So it's I really have no Ill will.

But I did think it was a cool uh I think that's a pretty w good one liner. I didn't I unfollowed like everyone on Twitter. I've been spending less time on it because It makes me angry. But I wish I would have seen that'cause that's pretty wild. By the way, by the way, th this was the best part. All the white knight. Do you know what a white knight is? Yeah.

So for those who don't know, a white knight is like sort of a I mean, how would you describe it? Like someone who like They don't They don't necessarily care about the topic. They're just trying to act like they're saving the day, so uh the girl likes them. Yeah, it's basically dudes online who come to the rescue of women, um, to virtue signal how they are, you know, such they're the good noble supporters of

Of good and evil, whatever. Um So anyways, th th there's a bunch of white knights that were in the thread. That were like Yeah, uh Sean, I can't believe you did this. I can't believe you would

Give someone this platform. First of all, Jake Paul hasn't fifty times bigger platform than me. Uh second of all Um

Yeah, I I That's my br that is my platform. I point out things that are interesting or you know, I point out truths. I'm not like trying to tow the politically correct line. And then I go to this guy's Twitter. I go to his Twitter.

The second retweet is Connor McGregor has sold this many millions of dollars of whiskey, you know, he's promoting it. Guess who also has a bunch of sexual assault allegations against them right now? Connor McGregor. So he was allowed To promote that Conor McGregor was doing that business.

I called him out, I go, dude. I like you. We've we've we've been friendly before. But what a hypocrite. Look at your own timeline, dude. You're saying this guy's very good business, this guy's a great market. He goes.

Honestly, I just didn't I didn't know that about Connor, and so it's blah blah blah. And then a bunch of people were eye rolling, like, oh you didn't know. Good. Yeah. Okay, cool. Like it w this has been on the news. This is a Yeah, yeah. You th you thought Connor McGregor was sort of, you know, m goodie two shoes? Yeah, right. Like this guy's been in the in the news. He's been in jail. He's been he's done all this stuff. And so I just thought that that was the the classic hypocrisy of of people on Twitter. Well Well I uh I didn't see it. I'm happy I know the story. I'm and I'm what I I love that you do that.

I think that is great and I think you should continue to do it. Hopefully you won't you won't not do that because you're asked not to, but We'll see. Do you want to talk about the course business.'Cause I actually I didn't get into it, but I I I saw a company and I that I think is kind of silly for what they're trying to disguise themselves as.

But I actually think it's good for what it re really is. And I want to bring it up, but I went and did a ton of research. And I know that you're interested in courses as well. Okay. Yeah. I'm I'm fully teased. I go for it. What is it? What's the company? Okay. So Today Uh the for this little segment, let's talk about the course business, the education business, whatever. I broke it down into four different categories, but there's this company called

I don't know if it's called Be On Deck or On Deck. Bon deck. It yeah, it's called on deck. The you the URL is be on deck dot com. Um, it's actually really confusing what they advertise themselves as. If you go to beyond deck.com, frankly, I didn't know what it was. I I didn't understand it. I did some research. I think I understand it now.

Um, and the way that I see it is it's a course business. So basically You pay I don't even know the price actually. Is it like five hundred dollars? Uh it's like hundreds of dollars, I believe. And you sign up for it's over a thousand dollars. It's over a thousand dollars. Is it under two grand? Yeah, I think it ranges between one and two grand, something like that. One and two. Maybe one and three. One and three grand. And you sign up to a cohort based class, meaning there's a start and an end. And they have got like fifteen different classes probably at this point. Maybe I I gotta stop you. There's these aren't it's not a class. Why why are you saying it's a class? No, that's what it is.

Um you can you can call the one. There's no teacher. There's no uh Okay, so Here's how I here's how here's how I would describe it, right? So so we you you know Eric Tornberg, right? He's I don't know. Oh you don't know. Okay.

Eric's a good guy. He's he was early on at product hunt, he left. And he's created a bunch of things since then, one of which was on deck. So

The way he thinks about on deck and the way he talks about it is Um On deck is basically like a modern day business school. So why do people go to business school? People go to business school because they want to build a a network. They wanna maybe learn about business.

And they're looking to kind of like pivot their career in a different direction, right? They were doing one job. They wanna go to the next job. They don't know what it is. They wanna change industries, change roles, change whatever, change careers. So business school is this great pivot point to do that. So what On Deck did was they sort of made An unbundled and digital version of that. Um actually not even digital. There's a lot of in person components to it.

So what it is is You um let's say and they have a bunch of different tracks, but let's say you want to go into Let's say you want to become an angel investor. You're not an angel investor today. So

On deck is your pivot to do that. You apply to join, you say, Great, I'll pay the fifteen hundred dollars to go to the on deck angels program. And yes, there is some education. They bring in speakers. who are angel investors, they'll talk about angel investing, that sort of thing. But it's basically a

X Week program. For you to Yeah, go from where you are now to that track that you want to be on. And it can be with angel investors, it's a little bit more like a course, which you're talking about, which is

You're gonna learn about a thing and then by the end of it, you can do it. But they the it started with just People who were on deck to build their next company. Like all right, you don't know what you're gonna do next. Why don't you join a group of other people who are also thinking about their next opportunities? Maybe they have a great idea. You could join their team.

Maybe you could find a co-founder and and do this here. And it was just people who were looking to make a change and um And you would pay to basically And to to join this uh to get a good network.

So the network is all kind of like Other kinda like it's just like if you go to Harvard, you're getting other people who have a certain caliber of of of person who's gonna go on to do a certain caliber of things. And

You pay to go be a part of like an eight week program or whatever to go do that. Yeah, that sounds like a class to me. An eight week program. Where you're learning and talking to other people. learning content side and it's a lot more about

The network. That you can build. Then in that case, I would say the likelihood that they're gonna be quite huge, I think is actually lower. It would actually be better if they were a course business because the problem with that is they're either gonna have to raise prices to be tens of thousands or hundreds of thousands of dollars a year, or they're gonna have to decrease the standards who they let in. And keep the price low and thus ruin their network. So let's talk about some of the programs that they have, right? So they have on deck founders that's I want to go start a company.

They have on deck first fifty, which is I wanna become I'm a talented pro operator. I wanna go join a uh early stage company in the first fifty employees that's gonna That's gonna be the next Airbnb, the next whatever, right? Uh, there's on deck investors where you learn about angel investing. There's on deck podcasters where it's like

If you want to start and kind of grow a podcast. join a batch of other people who want to join uh to start a podcast. Listen to speakers who are existing successful podcasters. And uh by the end of it, you'll have like built up some momentum of now going down this new path that you weren't on before.

So Let's just say who cares about on deck? 'Cause it got me thinking about the course business. I think it's a course business. You say is that it doesn't really matter what it is. Because that is what got me interested in the course business.

And the problem with the course business is When we say the course business, oftentimes people will categorize anything that's even remotely related to course into the same category. And that's actually false. That's not that's not how it should be. Um and so what I want to talk about is w the four categories and let's talk about what why each one is interesting.

And so I'll just briefly list what those are. So the first one is s basically one person or a smallish company Making A handful of courses. That's like our friend Jack Butcher.

Right. That's like Ramit Seti, our good friend, or my good friend Ramit Sati. And we're gonna I'll go back and we'll actually talk about what makes that. what it is. The second are platforms. So things like Udemy. Um things like teachable. A lot of people say this is the course business. That's not a course business. That's a tech company.

Yeah. uh makes technology so people so can create and sell courses. I'm not even gonna talk about that because that's a totally different category, even though people do sometimes refer to it like the uh this category. Um or and with courses. The third one is the master classes of the world. These are Another example is this company called The Great Courses. These are businesses that create

hundreds eventually of different courses and they go and sell to consumers for a hundred bucks to two hundred dollars, three hundred dollars a year. And the fourth one Is B to B. Companies that sell education to companies. And so a company like that is Plural Sight, which sold for three billion dollars and does something like five hundred million dollars in revenue. There's a there's a a a few other. There's Coursera. There's um

There there's actually a handful of them that I didn't know about, but in researching there's a handful that do Three hundred to six hundred million dollars a year in sales. multi billion dollar business. Now I want to go through each one and explain what makes them tick or at least what I think makes them tick. And and I w in order to do this. I went and talked to my friend Ryan Dice. Ryan Dice runs this thing called digital marketer dot com.

And he he's been in the game for twenty plus years and we kind of talked. Do this. So Uh the first category is these like single person traders. I think you're like that. Um, I'm not like that at the moment. I could probably easily become that and um I I enjoy that.

And I actually think that the path to making a million dollars a year this way. is incredibly straightforward and it's a very high likelihood in term all all relative to starting a business, but it's like a really high likelihood of making like a million bucks a year. It's very high likelihood that you can make two hundred thousand dollars a year. Um And so these are companies like

Uh, I will teach you to be rich. Uh Dr. Is that what it's called? I'll teach be rich.com. It's uh what you've done. What what was your newsletter called? The all access pass.

That wasn't quite a a course like it's it's what I announced. I don't know if you saw this. I tweeted out that I was doing a course. Yes, next month. And I said, Hey, I'm gonna do a course uh on power writing, basically like writing for the real world. And I just tweeted out like Would you be interested here's what I This has helped this skill has helped me. It's helped me get jobs. It's helped me

uh, you know, get investment. It's helped me grow my companies, helped me make money. So Writing. In the real world email, twits, blogs, ads. Landing pages.

That type of writing You know, going from good to great. It's a big difference. Would you wanna learn this? I said it'll cost four hundred bucks. Uh, for for the first batch of people, whoever's like kind of the the guinea pigs. Um let me know if you'd want to do this.

And um I got I think I don't know twelve hundred replies uh of people filling out the survey saying they want to do this. And so it Yeah, just that that alone. Is kind of like to your point here where If you're a creator with an audience with credibility, if you've done something, if you're actually good at a skill.

Yeah, you can get to a million dollars a year. Of profit. Uh not just revenue. doing it as an individual course creator. Yes, and the path is quite straightforward.

The tactics are are simple, but uh it's basically build an audience. That's all has or That mostly has Yeah, but even that, there's a process to that. I mean it it does it's not It's not easy, but it's simple. But you build up an audience.

where people rally around one type of thing and then you eventually s create something that costs one hundred dollars all the way up to thousands of dollars and you sell it. Um my good friend, one of my best friends, Neville Madora, has done this with copywriting. He probably I don't know what he makes, but I w if you said a million dollars a year, I would think that sounds about right. Um, there's Jack Butcher, like we said. My wife Sarah is actually launching one. Sean has one. I've launched one at the hustle before, but it's not live now.

But it was. And It's pretty interesting. It's It's the easiest path probably to make a million bucks a year, I actually think. And

The way that you scale. It it's really hard though. Now here's the downside. It's pretty hard I think to get past ten million dollars a year in revenue on that. Not that like that should be the goal necessarily, but like it definitely caps out relatively low. Um But you could if you as long as you don't base this on your personality, it's a pretty good business that you could sell to like private equity or something like that for a a a bunch of money. And after you've created the course, you then create a consulting or coaching service that costs 10,000 plus a year.

And you could potentially have like a pretty good ten million to twenty million dollar a year company. I like that. I I'll give you an example. My uncle does this. He's In real estate, he's himself has like I don't know a two hundred something million dollar real estate portfolio. So he created a

Basically how to get into multi how to do multifamily uh apartment investing. And he creates a course. The course I think is like five grand. Um he sells a bunch of those.

And then out of that some people pay him twenty five grand for like the more one on one in depth coaching because they're like Going at it. And for them. It's not hard to justify five or even twenty five thousand dollars because

The economics of even a single apartment building. um that they're buying are are such that that's What education. Hey, okay. Oh, which uncle?

Uh my my uncle uh I mean you don't know. You wanna you wanna you wanna pip him out though? I'm I'm trying to Oh, I don't even know what his course is called. He's my he's my uncle Vinny. I we should have him on. He's got a kind of incredible story and his personality is amazing. He's the most uh joyful person I've ever known. Almost To the point where people think he's like uh Are you high or something? And he But he's just like that twenty four seventies. High on life twenty four seven is kind of amazing. So Uncle Vinny's a great example. There's a good one of the uh example of this. Now the second one that I mentioned is like these master class businesses. These companies

There's a pretty clear path to get to like a hundred million dollars a year in sales. And what you do is you create something that Is In the three two hundred, three hundred

Dollar range for an annual subscription. And You Scale fast by buying a lot of ads.

Um, but before you do that, you have to create a a pretty big library of course content, which can take many years. So I know quite a bit about master class. Do you want me to give you kind of like some of the interesting bits? So Master class. They um Started by this guy, went to Harvard.

business school, I believe. Um, and then he you know, w one of the core insights was He wanted to create the what he said there's the library of Alexandra for um Uh Alexandria or Alexandra. Basically Whatever the library was of like kind of like all the best of human knowledge at that time. He basically was like, I wanna create that of

Today's time. And so he they spend Upwards of half a million dollars per masterclass just on the production value alone. Even their first one was over$500,000. And so the production value is like kind of insane. Soup it's like a Hollywood Shoot.

That they do. Personally, I don't even know if that's necessary. I think that's a that's that's totally overkill, but that's their shame. The bigger part was that they got the biggest brand name. So they go You wanna learn business? Well here's Howard Schultz from the CEO of Starbucks. You want to learn basketball?

Steph Curry's master class. You wanna learn comedy? Here's Steve Martin. You want to learn I don't know, writing, here's Aaron Sorkin. And so they took the The A plus plus talent, which is a key differentiator, right? Because Most of these online courses are like you said.

It's me, it's remeat safety. It's like these like Nish. You know, I'll just make fun of myself here, right? I we're nobody's in the in the world. compared to compared to what master class went and did. And the masterclass was like great.

I can take You know, chef Gordon Ramsey's cooking course. I can create a hype thirty second trailer. And I can blast that on Facebook ads. And basically he Gordon Ramsey has enough brand pull. that I can profitably acquire customers.

And so they do this with a bunch of creator a bunch of different um course creators, Serena Williams, whoever else They cut a Rev share deal with them, so they give them an upfront. Kinda like minimum guarantee. And then they have like a Rev share on every course sold.

You know, you get X. And then they turned it into like a class past style subscription where now You pay the fifteen bucks a month, you get access to all of master class. And I actually talked to the founder, the CEO. And I was like, he's a great guy and I was like

You know, do people I took one and you know, but like Do people Does a does a person really want to go learn cooking from Goran Ramsey and then basketball from this person, then tennis from Serena Williams? Like it seems like Do I need the all you can eat buffet? And like do I come back? Is the retention high? And he just showed me the numbers. He was like, Look.

We're making X hundreds of millions of dollars a year. It's growing at this pace. And look at the churn. churn's not so bad. I say how how do you keep the churn h uh so low, like for an education product like this? And he goes When people take a master class, it's

They keep their subscription even if they're not coming back and taking a course every month. Why? Because it's aspirational. They they have a dream of like learning photography. They want that hobby to to exist. They buy the master class and if they have one experience where they feel like their hero or their idol kind of shared a c a like a real nugget of wisdom with them.

Um That's enough to keep them hooked. So I thought that was pretty interesting. And that's the thing that we should discuss. That's the downside of this business as well as every other category that I'm mentioning. Is

Intention. Is this freaks people out. I wouldn't even say it's retention, but it's completion. So our our good friend Nick Huber s launched a course and he goes, Dude, two hundred people bought this. Do you know how many people finished and did the whole thing? He was I I the number is If it's not this exact number, it's close. He's like three.

Yeah, it was like it was like nothing. And I was like, yeah, man, that's really normal. Uh he he was being he was like he was legit he was like, dude, did I make a shitty course? It's like no This is the this is the standard percentage completion. If you go to Udemy, I remember uh with Udemy they I think they had said at one point in time Um, six percent.

of people complete the course. Six percent, right? A hundred students come in. Imagine on the last day of the semester, six people are left in the class. And so, you know, for Nick, it's pretty much in line with like This single digit Completion rates.

That was a big problem with education on the And that sucks. Actually I would Say two things. One Um For people getting in this business, just know that mo it's so weird.

that you're gonna make all this money and you're crushing it. Most people don't even use the damn thing. And by the way. They're not pissed. It's not that they used it because they didn't like the product. Often it's just life happened, they got busy, they didn't follow through. They If they're upset at anyone, they're upset at themselves for not actually taking the full action on the course. They're not upset with the course. Yeah, which is counterintuitive. The second thing here is like is that even important? Is this even a problem worth solving? And

The answer I actually think unfortunately is no. This is uh not a problem we're solving. People aren't gonna take it. That is just how people are. And

we should move on and just make money off of it because just the fact that they buy That's interesting and that kinda helps them in a weird way. Just like you with books. Just like you with books. It's like me with books, yes, that's true. But I would disagree in that I do think it's the fight worth fighting for. Because if people aren't actually taking the course

Ultimately they didn't get the real value of the product. Which means they're not gonna come back. They're not gonna tell friends to do it, which means your business is gonna suffer. So Can it be done? Can you get above six percent, 10%, can you can you get 30, 40, 50%? Dude, even that sounds fucking crazy to me.

I've asked um people who charge five thousand dollars per course. They said uh under thirty percent is still what they get as the completion rate. Insane because that's such a big financial commitment for people. um individually, not out of their company's pocket, out of their own pocket to spend that money and not complete it is insane to me. But that's what happens. Now I will say though, but when we had cohort

classes like a live cohort class. the sh it was like seventy five percent completion. Exactly. That's exactly what I was about to say. Lambda school switch to live cohort based. And with a um a clear like sort of uh high bar for entry. So Lambda School, most courses, right, when Nick Huber, Rame, myself. When you sell the course.

You want pretty much as many people as you can to take the course. That's how you make your money, right? You're like a college. You want to admit as many people as you can. Um Unless you're the top college where your brand is really about not accepting everybody. And so similarly with Lambda School, because Lambda School doesn't get paid until you get a job. Their incentive was not to let any Joe Schmo in. Their incentive was, dude, we only want a student if they're ac if we think they're actually going to finish this course if they're serious about it.

And so because of the filter on the front end. Plus the format being Live And in a peer group? They had like seventy five percent plus completion rate.

And then Uh I invest in this company Maven for the same reason because They were saying, Hey, we're gonna make it easy for you to teach a cohort based course. That was appealing to me'cause I was like So far, cohort based courses is the only thing I've seen where people actually finish the course. So we'll see.

So but that is something it it when we're going through this process we or this discussion, we have to acknowledge that like Most people Don't buy your stuff. And if you're doing really well. Like, what did you say? Seventy percent. Yeah. Do it.

So it's like kind of crazy. That that's a pretty nutty m nutty thing. Now to to wrap up the master class I don't be I have to call this like Mass consumerism, coarse bus So like Linda.com would also be in this at the time. Now Linda's more B to B, but at when Linda started, it was a place to go learn anything, right? Um

And and so Linda.com master class. There's a bunch of Master class four X. So it's like There's a master class, but instead of Steph Curry and Gordon Ramsey It's famous YouTubers and they're called monthly. I think monthly dot com.

They're trying to do the same thing as master class. But they're stars are social media stars. And I think they were doing actually pretty well. There's another one that's master class for athletes. It's like okay, we're just gonna take the vertical of of

Sport. And it was you know started by that. Um Shit, I just talked to him the other day. This would be a perfect shout out for him. I I apologize that I I don't have it off top of my hand, but uh But basically he he's a he's a trainer. He's a trainer for Kyrie Irving, he's a trainer for a bunch of NBA stars.

And so He's able to Carmelo Anthony. So he was able to say, Hey Melo. Create a create your course. Hey Kyrie, create your course, et cetera. And um And so he's able to access top flight stars in basketball because he himself is a is a basketball trainer.

and create a master class just of that. group just for that audience, which I thought was Actually a pretty interesting model. Eight, was his name Ida Iden Rabin? No, I'll find the name. Let me ask Ben real quick, but yeah, go on. I'll I'll get the name.

So anyway. Um The in order to make that style of business work. What you have to do is create a mostly evergreen course content.

And the name of the game is get like a basically as many as possible that meet some type of quality bar. Um And you just go big and try to create hundreds of them or thousands of them. How uh can you what The the great courses is one example. I think they do like a hundred and fifty million dollars a year in revenue. I don't know what master classes, but I bet you they're at two hundred to three hundred ish.

Yep. Um all right. And then the fourth or the third cat so I I had three categories. I had like the small trader I had Tech stuff, but we're gonna get rid of the tech thing like you to me. platform like you to me in Coursera.

And then you had High end, um You know, uh library of of courses, like master class. What else? Now here's the fourth one and most interesting one, which is B2B education, corporate training type of stuff. Easily the biggest one.

Hands down. Now an example of this is plural site. Have you heard of plural site? I've heard of it, but I could I've heard the name before, but I couldn't have told you what it did until this. Beautiful, lovely name. It's geared specifically towards engineers and it just teaches like the latest and greatest uh Um Tech stuff that

You you give your engineers and and they go through this. And Uh plural site is one of them. There's actually a bunch of more a bunch more. And They

There's many of'em that do three hundred, four hundred, five hundred. million dollars a year in revenue. And but this is where it gets kinda shitty. These businesses are based on one thing. Salesmanship.

So you just hire a fat sales team and you go out to these companies and you sell. And I went and asked the people at the HubSpot, I go, Why do you guys buy this stuff? And they actually told me all about it. Um, and they're like, Well, basically we're ranked really high on Glassdoor and we recruit a ton of people. And one perk that we have is that we give you five thousand dollars a year. Uh for education.

Now we could have bought plural site, but and that would've actually solved the same thing, which is We wanna be the best place to work. We offer loads of perks like We'll teach you X, Y, and Z. Um, another example of why these courses are important is something like Cisco or Microsoft have tests and exams that they want you to pass certifications.

you just put it on your resume that you have this interesting thing. Plural site teaches you uh how to succeed at those uh At those um Um What am I saying? At those uh

Certifications. And they charge something like six hundred dollars a year per head. And you just gotta hire a sales team with a you give each salesperson like a three hundred thousand dollar, five hundred thousand dollar quota and you go Here's the f yellow pages. Start dialing.

And and that's why and the plural side's based in Utah'cause the Mormons are like some amazing salespeople because they've been they had to spend two years selling a religion to people. So they're really good at it. Um But this business is probably the biggest But I oddly, it's really not so much about

The um It's not about education. It's not about education. It's about salesmanship. And the way that you win this Um, is you you you go down a very narrow knit niche, you hire subject matter matter experts, so people who know their stuff. You pay them a flat fee, sometimes royalty, but you prefer to do a flat fee because your gross margins will be really, really Uh a lot bigger.

And then You go very niche, you go very role specific, and then you go and you sell into the HR and then learning an or Learning and development. budget at large companies. Which sucks because

Yeah. those are typically the budgets that are slashed first, but they're there and they have to get spent. And so pretty much it's a game about getting inside with these people and selling to them. Kinda lame, but there's money to be made. Yeah, I wonder if somebody could do so so that's the way that most

corporate software was sold too. Until Slack and some others started this like bottoms up. sales process inside companies. With still how it's sold, though. Um it isn't is it, but there's so bottoms up SAS became its own category where the model was

You make your software useful to even if the whole company doesn't adopt it. You let an individual person kind of in the front lines or the middle ranks of a company start using it. They use it with their team. They're kind of like their sub team. other sub teams start using it. And then you go to the CIO, you have a meeting with them and you say, Hey, by the way You know, a bunch of your comp a bunch of your employees are using this thing, you need to buy the like The enterprise version so that you have like security stuff like secured

You have uh oversight over what's going on. And that anybody in your company can get access to this right now it's Everybody's putting down their own card and trying to make this happen. And so that became a pretty popular model. Yammer was one of the first to do it. uh then slack and others.

Um I wonder like this would be the only way I would want to do it if I was an entrepreneur going to space'cause I wouldn't really want to do the enterprise sales path. Um, where It's not really about the content, it's just about the sales, you know, how good you are at sales as a company.

Um Because if you go bottoms up, you're really going off of Making stuff that the individual employees actually want to learn from. And then secondly, um you're only as good as as them sort of retaining or actually wanting to use this. So I think that's a healthy thing in the end, although it is. harder actually than the other path.

So I I wonder if there's a way to do that. The hard part here is Just like their six percent completion rate for Hobbyists trying to learn. I think similarly

H you know. Um I for example I know that when when the learning and development team sends out an email Uh at Twitch. I asked my team, I said, Hey, do you guys do any of these courses that there's a bunch of free stuff available here.

They pay for it. You can just go take it, like Could help you. And they're like, Yeah, that's a good idea, but like I just don't have the time. Like everybody feels overworked. So the amount of time an employee is gonna carve out.

To just do optional education is so low that I just think that most of the things that live in the uh What's it called? The learning manager or whatever, like the LMS learning management system inside companies. is uh untouched, right? It's just Twinkie sitting on a shelf. So that's exactly another that or that's another thing. So not only is it about salesmanship

But basically These courses The truth is It's not actually about teaching your workers Something good.

It's about offering it and if they use it, fine. But the fact that you offer it, it makes you look better and you could hire more people. Um, as I don't own my company anymore, but when I did, I would never have bought the shit. I would have been like, look, you want to take something. We'll buy you any book you want. I'm not I'm but we're not paying for these stupid courses because no one's gonna use them. But That's not how a big company thinks because they want me to put it on their

Perks and benefits and Here we are. But that is my my very high level summary of this course business. I was very curious as to how they were. Um if I was

Well, I am I'm not gonna launch any of the same time soon. But The first one, the creator one. That's a that's a no brainer.

It's a no brainer once you have an audience, right? That's the If if you don't have an audience is not really gonna work,'tis then then you're more in one of the other buckets, but Uh I think you correctly identified. If you have an audience, it's a no brainer business model for people with audiences. But it also has a cap.

And it takes up time. So you gotta like Yeah, choose accordingly. Um all right, let's talk about some other ideas. Um, I have one that I saw today that I think is pretty interesting. So it's called the Irish pub company. Did you see this tweet? No.

So we got tagged in this, which is by the way, that's the best signal that we're doing something right is now People just tag us. In shit that they know is the type of stuff we want to talk about. Like we've built the brand of like When you hear about a cool niche business That's crushing it. That's like

So simple and you've you you would have otherwise just never heard of this. It's like this is perfect for my first million. So somebody tagged us. Oh, this is awesome. Our friend um Chris, uh Chris J Backie is his like handle. I don't know if it's Backy or Bach, I don't know how you say it. Things back.

Um He tweeted this out. So so shout out to Chris. He was on the podcast a while back. He's a Super entertaining guy on Twitter. You should follow him. He said the Irish pub company is one of my favorite companies.

They charge one to four million dollars for an Irish bar in a box, which basically means it's an Irish bar as a service. So here's how it works. Um They give you, you know, like they have like six styles to choose from of which style of Irish bar and they give you like The Guinness signs, the ha the right bar tap handles, you know, the kind of like all the decor, the seats, the the the stuff like that. And they they ship it all to you and they install it for you and like

Bang, now you have an Irish pub. And I think this is such an amazing business. So They've done over two thousand kits. And it's about one to four million dollars per kit, according to him. So I haven't This this happened like two minutes before the pods. I didn't research too much more, but

That's over thirty years. That's two billion dollars over thirty years that this company has generated. Just selling The Irish bar in a box. And um and what they say if you go to their website Is like

You know, hey, uh like the Here's the stats, right? Like the uh Irish pubs produce you know, X more revenue um than a a traditional bar. Um And has this much more foot traffic and basically it's saying, Hey If you if you throw this kit onto a generic bar, your bar is more successful.

It'll pay itself back. Uh, what do you think of this business? So the owner's name is Mel McNally. Which is like the Perfect. Perfect. Got him. Um, he's the founder of Irish pub company, is the creator of the Guinness Irish pub concept. So he launched this in partnership with Guenness Brewery.

Brewing, which is basically I'm just reading the about page, sounds to me like Guennis was like, Hey, we need more Irish pubs to exist in this world. So we can sell more Ir Irish beer. And Ganus Beer. Can someone uh come and f help us figure this out? And that's what he partnered with. Uh or that's how we started this. Awesome, awesome, awesome. This is so cool. I love this. Well

It's crazy. The the they're making I mean, I think just looking at the numbers, if if this if these numbers on their website are accurate, I think they're doing like fifty million dollars plus a year. um doing this just like the consulting, the brand identity, then the like install the shipping, then the installation, and then the service after that.

Um It's pretty pretty awesome. How this guy do it inside airports, they s do it in in you know just different cities, hotels, different stuff like that. How did your buddy find this? I have no idea. He just tweeted it out. Um

So it's great. I don't know. I think this is such a cool concept. And then you can think about like okay. How many more concepts are there like this, right? So like I th I can think of If you take any Sort of like sub genre.

The question is, is there a market for that? So I'll give you let's just brainstorm for a second, right? Well, there's one what one great example that you brought up a long time or a year ago that I think is Probably killing it, and that was bathroom in a box. Yes. Made revolution m made renovation. Yes. All they do you select one of five different bathrooms and they come and make it. You can obviously do this for every single room in the home, but And then we we talked about the guys who came and set up our video conferencing setup. The you know, this good looking setup that we have right now with the lighting, the audio, the D S L R camera have the

The whole tech is set up, the wires are You know, taped to my table so I don't have a wire mess. I told the guys, I said, Hey You need to turn this into home home video conferencing, home studio in a box, right? You can

You could do just like the bathroom guys did. You could do this. In every city in America right now, especially with remote. with podcasters and twitch streamers and YouTubers. A lot of people want a cool video setup. And if you just have four to choose from on your menu.

Now you have simple operations. You have scale as you buy parts in bulk. That sort of thing. So I think that's another version of this. Um, but just on the bar concept, I think that there's a few more.

So I think that any brand with licensed IP, so like Okay, you can't like you could you do But could you do this for basically Disney? Could you do a Disney diner? Right. Um so you take I P that people love.

And you create a bar restaurant out of it, right? So like sort of Rainforest Cafe style. And you just sell that as a in a box concept for any um common thing. Coffee shops, diners. Pubs.

Yes, but aren't you confusing this whatever this in a box concept is compared to Franchises. So it's not Francis so this the idea would be You would partner with um, let's say, I don't know, let's call it the Simpsons.

You partner with the Simpsons franchise and you say, Hey, look For every one of these, wouldn't it be great if you could have, you know, I forgot what the bar's called in the Simpsons, but like Whatever the you know, the wherever Mo works or whatever. Yeah, or do Patty's Pub. Yeah, you could yeah, exactly. You go to all sunny and you can basically have Patty's pub in a box, and every city should have a Patty's pub and whatever. And um

So you go and you say, Every one of these we sell, you guys get ten percent. You gotta do nothing more than let us use the name Patty's Pub and you know the the The same items we're gonna source. And now you go to bars and you say, Hey, look. You as a generic bar. You're only pull you have no like differentiation of why tourists should come here, why the locals should choose you.

Um Can you upgrade? And so I think that there's a bunch of different concepts that would work with this. So I think one is gaming. Gamers have like a

Deep passion. And um And so y there's been s I I I I lived in Denver and there were some bars like this where it was like The bar had like some old school retro arcade machines. All the drinks and menus looked, you know, like video game like you know, old Nintendo stuff.

And then they had like you know life size janka or whatever, right? But it was a place to go hang out, you could play ski ball, you could do whatever. And they just got way more foot traffic than a normal bar. Why? Because this one you would go to and you would have Instagram worthy experiences, right? You would post in your story that you're drinking, you know, the Mario drink while playing whatever duck hunt or ski ball or whatever it is. And so I think gaming is one niche that's like an Irish pub.

That you could show that hey, if you if you kit your bar out with this, you're gonna get more for traffic and more sales. I would need to think about which which of these could work, but this whatever this in a box thing, it's kind of interesting. I had a friend that did book in a box. And they would write a book for you. I think it was making eight figures in revenue, but it sounded like a

real pain in the ass because It was It was far too customizable to be in a box, whereas A pub thing. Probably isn't that's way easier. That's like said like

You got running water. You got uh You know, this many dimensions. decoration like Theme. That you just slap on and boom, you got an Irish pub. Now you don't you had a pub, now you got an Irish pub.

And so I just wonder You know, A, could you just compete with them? Or B, are there other themes That are Even if they're not as popular as an Irish pub, like what's the second most popular kind of like

Is it German? Is it You know, an Asian style pub? Is it a Russian drinking bar? Is it I don't know. I don't think like a Mexican tea tequila bar, or is it a Yeah, what what is it? That that uh is it an Italian wine bar? I don't know. Ki I don't know, you're asking a non drinker. I'm I'm out of the loop on this one. I do have a different idea.

What's that? That I think is kind of interesting to chat about. So Uh clear ice. Have you ever heard of clear ice?

Mm. What is it? This to me feels like if you're um I'll find you the URL. Go to clear ice.life. So ClearEyes.life. So this is not something I would do.

But I've learned that These things that I just shake my head, I'm like, who the fuck wants to do this? I learned like the hard way that like three years later it's like yeah. This is like a this is like a hobby that a lot of people have that's like growing like crazy. So here's the other examples of this. You know, like soda stream. I think you probably do Soda Stream, right?

Dude, I have a video on TikTok. One of the only videos I ever posted. It got like two hundred thousand views because I attached a Like a scuba tank size CO two thing, I rig it to my soda stream so it could last like three years versus having to passively replace the things. Yeah. I love SodaStream. So the first time I heard this, I was like, oh you like make your own sparkling water at home? Like what's the fucking point of that? Dude, Soda Stream is like a five billion dollar a year company or something. I know that's my point is that when I heard I was like who would want to why is this a hobby? Who wants to do this at home? Why is this a DIY Category. But it was it was a huge category and like you know, it got bigger and bigger.

Craft beer. Same thing. I remember like a decade ago These guys were like brewing their own beers and I was like, Why there's so many beers, why don't you just go buy some? And then like over time more and more home brewers and craft beer before. Dude, have you ever met a white guy before? Like that's like what like there's two things that you you There's a two jokes about uh white people. They always have bottle openers on'em and they love making their own beer at home. Yeah, basically actually this category is just shit I observe white people do and I've confused about. Uh so another one, like there's this there's a bunch of these like with pour over coffees and like

These like really extreme coffee habits that people have. Um Anyways, there's a whole bunch of these. These little niche hobbies of DIY things that I don't understand, but they definitely are big. And then they create a whole ecosystem of businesses around them. So clear ice is the latest one I saw that was like this.

Basically, what is clear ice? Clear ice is basically like I might even I might not even fully understand this. It's That's how white this is. Okay, so you you you translate this for me. What I understand is It's like a

It's like an amazing piece of ice. So not just the shit you get out of your fridge or your little tray or the stuff you buy in a bag. But it's like this is high quality. It's like super clear, like there's no um you know, impairments are like kind of stuff in it. So it doesn't flavor your if you're drinking whiskey, it won't like affect the flavor of your whiskey. It's also one big cube.

So there's less surface area, so it dilutes uh less. It does it dilute your drink less. Well, you knew that, right? I didn't think about this stuff. I don't care. I just put the ice in, I drink by drink it, when it gets diluted I drink it, it's kinda group. Yeah, they like sell these like cubes or balls and they Yeah, it involves surface area and melting and diluting your shit slower. Right. And so So anyways, this hobby This is like some shit that you would find in the hustle trends thing. This is my own little contribution to trends.

Uh, you know, Steph Smith, if you're listening, put this in the newsletter, go research this. My spidey sense is tingling that this is one of those little niche hobbies. That you could sell products, information, courses, whatever. And there's a lot of people that want to make their own homemade ice. Again, I could barely understand why.

But it's a thing that people are doing. And I bet you that there's a uh a movement to be had or a a sort of s a wave to surf. If you want to build a business around. Super niche.

But a hobbyist business. Dude, no, I don't I'm not on board with this. I think this is stupid. I think. Why? First of all, is this even that big?

Is clear. I I s I saw it as part of like a growing trend. I don't know if it was a subreddit or where I saw it. But I saw it in a way that was like, Oh, this is one of those that's like popular and I don't understand why. Like it's like ASMR. It's like what is that? Uh ASMR is awesome, so don't you better be fair. That's how all those few felt to me at the beginning where I'm like, This is weird. People do this, and then like, yeah, a lot of people want this and do this.

Yeah, look, I am I'm looking around on Google. I get it. To me this sounds like a a pretty tiny thing. But like t tiny enough that you could make like a pretty good living doing it though. Like I knew

Yeah, all you want to do is you want to catch these early, right? Like you want it to you wanna catch it when it's somewhat tiny, but like very passionate. Because the bet you're making is that that passion, the tiny will the passion will stay and the tiny will not. Right? That's pretty consistent. Uh is that when you have the passion there Passion stays and and tiny go becomes medium size becomes large over time.

Yeah, I guess it could work. I mean I'm looking I'm trying to like look it up. I mean, there's this other one there is a a home brewery company that I that I I I for a long time I didn't know that like People Basically beer nerds like track all the beers that they've ever tried. And I interviewed a guy to work at the hustle and he worked at one of these companies and it was like a

Tens of millions, maybe even close to hundreds of millions of dollar. revenue bus business and all it was was an app where you could track all the beers that you uh drink. Um So put that in that category of things I have no idea exist and Also kind of they don't excite me.

All right, let's do uh let's do one more real quick. Um Okay. Uh here's one that I'm just curious. I I don't have ideas around this just yet, but let's Let's do a off the cuff brainstorm. So there's this article that came out.

That was about Uh I'll I'll share it with you here. It's about The amount of space That is now available in San Francisco because of like work from home. So There is some absurd amount

of vacant space. So there's like companies that are Taking tenth or even a hundred million dollar Right offs. on their real estate. Just to like get out of it.

And move on. And so they're just they're just writing it down. So like Here's some of the the numbers. Um Let me so there's two hundred million dollars of real estate impairments

In the past year since Covid. It it's almost a billion if you add in the lease related write downs from large companies like Salesforce, Dropbox, Uber, PayPal, Zen Desk. Just getting rid of their their uh real estate. And so um Dropbox itself has four hundred million dollars of impaired real estate right now. And so

They think that by Yeah, and in this quarter, the first quarter of uh Sorry, the last quarter of twenty twenty one. The amount of vacant and subleasable space.

Was ten million square feet. In twenty twenty one. In twenty nineteen that was three million, right? So it's tripled the amount of available um subleasable square uh square footage. And The companies are basically saying, Hey

This is it costs us ninety dollars. We'll take twenty for it. So you're able to get Real estate. for you know one fourth of the of the traditional cost is a good idea yes this is an interesting real estate. So what comes to mind? What what do you think of when you hear about kind of this

Just opening that's in the market. Okay, for the sake of discussion, let's just assume that they like San Francisco has a bunch of wacky laws, like um Um I mean like people can't do with things. Yeah. And they also have like some really crazy tender um

um, what's it called? Rent controlled stuff. So let's just assume that like We're gonna research these laws later and and that's uh isn't that big a deal. I'm just assuming we're never gonna research these laws. That's what it's really assuming. Um But so what could you do with this arbitrage? I mean The obvious answer is like we work can make a killing right now. If they believe in their model, can they

Can they just go ahead and like do the thing where they uh least a lot of it up front and hopefully they can fill it. But what else could you do with this? I don't know, man. That's a hard question. What would you do? I don't know, you I think you have to see what

Um what you I think you want to Think about it this way. Where is demand growing for space that being Central in a city would now make a very big difference. Cloud kitchen.

Cloud kitchens, cloud Grocery and convenience, uh, like cloud c cloud corner stores basically, like um um fridge num more or something like that. I think those are kind of interesting because uh Go Puff. Because

You have a whole bunch of people in the city and now when they push the button, they get their thing in under ten minutes. Because it was They they took a floor in the bottom of the Salesforce Tower. Yeah, the the second floor is now all you know, robo convenience stores that will just quickly deliver to you.

Um, so I think you have to find something like that. Maybe it is we work style, you know, kind of um Co working spaces. But there's gotta be something else that you would do with this prima real estate. Maybe there's something in education that You know, you create a distributed campus.

Or something like that, um across a whole whole bunch of different cities. And so you know you take a business school. I did uh you know, take Harvard Business School online, which they have. And you basically say great. You can attend Harvard Business School online. In San Francisco, downtown, in LA, downtown, in all these places because

That's where that type of clientele wants and now you get A once in a lifetime opportunity to lock up that real estate at a fourth of the cost. I don't know. Those are some just random ideas off the top of that. That is a I think that's quite an interesting idea of Th that's actually a good idea because that would Yeah, it's almost you know, like the equivalent of a study abroad. But you're just gonna do it in San Francisco.

Um which prohibit was prohibitively expensive for the longest time. That is actually kind of an interesting idea. Um Oh, so what what do you know what the price per square foot is right now? Well in this they were saying five they were saying twenty dollars a square foot.

Um, which is like uh that's an annual number, right? So it w would have been ninety dollars a square foot annually and now twenty is kind of what's quoted in this. Uh C N B C article. Do you know how that compares to like an Austin, like a more like a sea level city? I don't know. I think that is like what I think that would be like what a a mid level city would have been. Um

Without the pandemic. That's my guess. Is something like that. I think San Francisco was four four to five times more expensive. Per square foot. um than than you know a B level city. You know, I think that I I've been living in Austin now for uh just a handful of months. I miss San Francisco dearly. I do think that if you're starting a company now, Um and you have like a good

size workforce. It would be interesting to try to kinda sign a lease now that you can book out for five or ten years. I do like it's gonna roar back, I think, eventually. Um I mean, I think that's the opportunity. Here's another one. Let's say you're a uh random. Let's say you're a venture fund.

Or uh late stage uh venture fund. What if you took the real estate and then basically any of your companies can just use this and pay you the the, you know. Pay you market rent or slightly above uh s maybe slightly below. So All your portfolio companies now have their real estate problem. uh solved and you know you could place them because of that.

Dude, people were shitting on We Work. Myself included. I think now it's like this this makes sense in a lot of these cities, these these we the wee works of the world. And not only that, I think that they're just gonna come back like crazy. Cause every employee says the exact same thing. Well, I would love to work from home for a few days a week. Yeah, exactly. It's like well, dog, I can't pay rent a few days a week, uh if I have my own lease. Right. I'd love to die a few days a week. Yeah. So I think that like the the Saunders of the World and a bunch of these other companies that didn't do so hot. For the last two years.

I think they they absolutely can be started right now. And I think it sounds crazy Crazy to start him right now, but I don't think it is even a little bit. Bro, I loaded up on Airbnb stock today. Oh my gosh, I'm devastated. I I'm seeing it go down. Wh what is it at now? It's going down because the lock up period ended. I don't know if you guys sold your shares or or not, but the lock up period ended so people could start selling. So it put a bunch of downward pressure on the stock.

Plus the market in general is such a N I thought Oh, did it end? I didn't even know. I thought it ended in June. Thing ends in June. I think it's six months for some in for for I think for some insiders at least, uh they can dump they can dump today. Why on earth would you ever dump Airbnb stock right now? But I bought it because uh

A I just I'm stupid. I just buy stocks when I feel like it, but B Um, I saw some data that was showing how A huge amount of Airbnb bookings, I think twenty eight, thirty percent. Or Um

Actually I I don't remember the percentage. It it's a very large percentage of Airbnb revenue or bookings was coming from stays longer than thirty days now. Um Which means that it's actually not Vacation rentals only, you know, it's actually Millennials just saying, Ah, I want to stay here for a little while.

Which is like I think a pretty big trend of I don't wanna be I don't wanna buy. I don't even want a one year lease. That's too much commitment. How do I hop from place to place similar to what you did last year? Uh so many I think. Twenty eight day plus stays. I think that is actually an interesting trend that people should Take advantage of and we actually have a guy coming on the podcast um named Bill Smith.

I guess his name is like a real generic name. He started shipped. which sold for like six hundred million dollars based on Alabama. It was like an Instagram better. He's got this new company called Uh landing. Is you don't talk about Yes.

Uh what's the URL? It's called like landing home or something. Home landing. Uh but anyway, what it is is they lease out apartments. in different places and they take the whole lease and then they sublease it because for people want to stay for a month. And the thing about Airbnb Yeah, is that

They actually charge what's the fee? 10%. If you're staying for two weeks. If you're staying like in New York, like I'm gonna be staying, I'm moving to New York for three or four months, uh, it's prohibitively expensive. So I if my rent is 10 grand a month, I'm paying a thousand dollars a month just in Airbnb fees. And so if they can figure out how to reduce that fee to something that makes sense for the longer term, I think that in the future. People like uh us, um, and maybe a little bit younger, I think it's gonna be incredibly normal to live somewhere for nine months and somewhere for three months. Right. And so if they can figure that out, it's huge. But do you agree that Like if you would you consider living somewhere for three months out of the year?

For sure. I plan to do that, yeah. Where you're gonna get like a little I got like a little baby right now, so it's just a little bit tricky, but yeah, that's that's the lifestyle I'm gonna live is L living in one place And then the other place for two to three months out of the year. Without sounding like a total douche, is this a rich guy thing or do you think that like lots of people are gonna be doing it?

Well, you could do it e you could do it economically. Like I know a lot of people that did this and made money doing it, right? They wasn't a rich guy thing. They went They live in San Francisco predominantly. And then they sub they they Airbnb their San Francisco place for a month. They go live in uh uh you know, Mexico or South America. And actually they make money.

for traveling because the San Francisco Airbnb costs more They're able to charge more for that than they pay in South America. My lease or not my lease, my uh mortgage and insurance and everything at my house costs about forty five hundred dollars a month. And I think that we're gonna get about ten grand a month when we rent it out. Um

And we're gonna use and then we're we've already booked a place. We're living in Brooklyn. I'm living in Brooklyn from July to uh September. And so and I plan on doing that indefinitely and I think a lot of people are gonna be doing that as well. Cool. Um I gotta run. I gotta get out of here. But Good episode. We're out.

I feel like I can rule the world, I know I can be what I want to I'm putting my all in it like my days off On the roadless 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.