Encarta | Our 2020 Predictions For OpenAI Came True… Here’s What’s Next (#508)

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Alright. This morning, Sam texted me a great idea. He goes, let's go back through the archive.

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Let's find things that we predicted or pin strong opinions that we had at the time. And let's bring them back up. Let's see. Did we get them right? Did we get them wrong? What did we get right? What did we get wrong? And what can we learn from it? And so we're gonna go back. Nobody does this. The way. Everyone loves to make predictions and have opinions,

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and nobody ever goes back unless they were right. Well,

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we're gonna show you where we were wrong on a bunch of these. We did seven or eight of these that,

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we had a strong opinion couple years ago and now they've played out and we can review how we did. And at the end,

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we make two new predictions. So two new things that things that have our spidey sense tickling, things that feel like there could be big opportunities.

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That we're gonna plant our flag and say, look, I think this is the this is one of the new ones. And we'll see in two years if we're right or wrong. That's at the end of the episode. Alright. Enjoy.

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Alright.

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We're live. What are you drinking?

01:02

This is my secret sauce right now. I'm not telling people about this yet. Water?

01:06

Nope.

01:07

You can see from the color, it's a little different.

01:10

Green water. I'm just doing some experiments. You know, I thought,

01:14

You know, we had this we had Derek from more plates, more dates on,

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and he was talking about pre workout. Right? He created a gorilla mind, that supplement. And then we talked about bucked up. And they're a pre workout supplement.

01:26

And, basically, it's like people take a scoop of something before they'd go to their workout so that they get a way better pump and just really, like, sort of, dilates their, you know, vasodilation and it gets them to have a better workout.

01:38

I want that for work. I want pre workout for work, and so I am,

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experimenting with some things that will how do I have, like, a boost of boost of focus, boost of productivity?

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Yeah. Kathleen,

01:52

I think it's called. But that's okay. And you don't No. You're not cappy. Cappy is for from your mortals. Let me, let me ask you a quick question. Alright. By the way, today's episode's gonna exciting. So we're gonna actually gonna go over some of the predictions that we've made both right and wrong since the pod started. A lot of these predictions are to come from the two thousand twenty era. Gonna look back when we we're gonna call it. What did you say? The I told you episode.

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I told you so. I told you so,

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but it is also gonna be I told you we are stupid and we get things wrong as well. I told you so, and sorry I told you that because I might be wrong. Right?

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But I definitely told you. Definitely sent you. I just want you to take your right hand. I want you to put your right hand in the air real quick. And I want you to reach back. And let's give ourselves a little pat on the back here. Why? But not because our predictions are so great, but because we're actually revisit revisiting predictions because predictions are one of these things.

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That people love to do. They love to people love to spout random opinions about stuff.

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And then they just go they just it just all gets washed away in the noise of social media.

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Rarely do people ever go back. And when they do go back, it's only for one reason, when they were right. Nobody ever goes back and says, you know what? Nobody asked, but, hey, I just wanna tell you. I think I was wrong about that one, or I was at least half wrong about that one. And,

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that's not the code we live by. Not here. Not us. And so we're going back. Nobody asked us to do this. We're going back and we're revisiting some of the shit we said, and we're trying to figure out where we write or we wrong

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or something in between. And, we have a a handful of these that we're gonna go back. And these are, like you said, two, three years ago. So they've had time to bake And, we'll see how they play. Not much time, but a little bit of time. And the thing about predictions is I was, you know, there's a lot of crazy stuff going on in the world right now. And I was curious. I was, like, you know, you and I have been having this discussion a little bit off the pod about, like, where do you invest your money if you think the world's gonna end? Like, part of thought, exercise, part, like, things are crazy.

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And I was looking at, like, a lot of really smart people, smart money people, Bill Ackman, Ray Dahlio. You cited Ray Dahlio. You well, Ray said this. And my reply to you was, yeah, but he's been wrong about x, y, and z. And I had to really dive deep about where they were wrong, because if you just read the Wikipedia page, you see when they are. Right? Like, Bill Ackman was right about all these things. He was like, oh, but he actually lost a ton of money on this thing. His predictions are challenging,

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because

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not only are they hard to make,

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but the people who get right get get them right a bunch of times are also wrong a ton of times. So it's really challenging to know who to listen to. Like a batting average. Right? Like, you can bat if you bat three hundred,

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you know, like, I don't follow base anymore, but I think you're like an all star. That means, you know, you're missing two out of three. Right? You are you're you're not hitting on two out of three. Predictions are way way way worse than that. Right? Like, if you're predicting

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correctly

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on five to ten percent of your predictions, but you're right in a big way, meaning you're non consensus. So you're bet you're right about something that a lot of other people are wrong about, then you make it big, which is one of my one of my favorite quotes, set this on the Chris Williams pod,

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Pessimists get to be right and optimists get to be rich. And so one thing we'll see when we go through these, I think, is that The times where we said, ah, it's not gonna work. Those are the ones where we have a higher hit rate. Right? Because pessimists

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naturally get to be right more often. However,

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The money is made when you're an optimist about something that other people are pessimistic about. Or as my father once told me, hey, even a blind squirrel find a nut once in a while.

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I love that first, by the way.

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Speaking of nuts and seeds, let me tell you about this first one. So a few years ago,

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I was interested in freezing sperm.

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The reason I was interested in freezing sperm is because We don't need to know, but okay. No. Listen, men's men's sperm count is going down, like, a crazy amount. Remember, Ben, our old producer, Ben, had this big thread on Twitter where he was, like, he documented sperm count, and he, like, made some drastic prediction that, like, in fifty years, like, very small percentage of men are actually gonna be able to, procreate. And this is actually a really big deal. And so I've been I've been research I've been interested in that topic for a minute. And so I tried freezing my sperm and actually re re

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looked at the episode that we talked about it, and

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the episode was Sam's unboxing of his of his sperm kit or

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something like that. Yeah. Because you had it. You were, like, held it up.

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Dude, here's the story. I so, like, you have to, like, you know, you have to, like, get the sample First of all, to do it at a hospital,

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which I also did, you have to bring the specimen

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thirty minutes after capturing it.

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So, like, if you're not close to a hospital, I don't know what you do. You go in the room, you go in the parking lot. I don't know. It's like a really weird thing to collect, and it's a very shameful thing to hand

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area.

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It's a covered parking area you could pull into. It's a very shameful thing. Like, when you walk into the doctor and drop the bag, way my have you ever given pee? It's, like, that's kinda shameful. Giving sperm is is way worse. And so I used I'm always making excuses. I'm, like, I just didn't have a lot of water today. And they're, like,

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I'm like, I captured the specimen, though. Yeah. It's a very shameful thing to do.

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And I, so anyway, I tried one of these at home services, and I brought it to my office because you have to you have to do it, and then you have the refrigerator, and then you have to mail it in. And I, like, packed it in a box within a box. So no one even knew, but I didn't have I had to do it at at lunchtime. And people in my office were like, what's in that? What's that in the refrigerator? Box. And I was like, oh, it's it's just a it's just a thing. It's a thing. But it says, like, it it says it's like a biohazard or something on there. And then eventually someone, like, I was like, alright, what is this? And I'm like,

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it's my sperm.

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And, they got re my employees got really angry at me, and they, like, told HR, and I was, like, I I I don't know what you want me to do, man. I just this is what I had to do. So so that's like a funny update. But I was using I tried two services One was called Legacy, one was called Daddy, d a d I. At the time, Legacy had raised, one point five million dollars.

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And, the update on them is they've since raised,

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around of three point five, around a fifteen million, around of twenty five million. So what's that? That's

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forty five million dollars they've raised. So I presume things are going well with them. So the the most recent round was in two thousand twenty two. Daddy, the company that I talked about at that point, it's it's kind of a weird name. I don't even like saying that. They had only raised it. That out. Yeah.

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Yeah. It's weird, man.

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So that company has since been acquired. They're bought in two thousand twenty two for a hundred million dollars. So that is a a thing that we we mailed, I think. And I think you almost had back to back episodes because you also were talking about,

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TRT

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d we said d to c t r t. We I think we were, like,

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six six letters,

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and we wanna make a hundred million dollars. D to c t r t, and we were both, like, that's a great idea. And I thought you were gonna start that company because I was, like, this is I researched it, like, crazy. A fantastic idea. You researched it, and I was, like, You're kinda shameless enough to go do that,

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but you didn't do it, but you did introduce me to the company that was doing it, I think. And we both invested. And we both is doing fantastic at a company called Hone. And, they've gone I mean, they're gangbusters. Every one of their updates is fantastic. So Yeah. I think that's That was a that was a right prediction. I I would say. And those were both off the beaten path. I don't think a whole lot of entrepreneurs were were thinking about capturing the specimens, so to speak. And, you were, and that it it paid off. I think I invest listed at a ten or fifteen million dollar valuation.

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I don't actually I haven't read their updates because it I think that's sent to my old email. If you're listening to this phone, update my email.

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But, I imagine that business is worth nine figures. I would think. I think it's worth ten times to be invested in. So anyway, that's a that that's an interesting one. TRT and,

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sperm collection.

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Yeah. Those are those are correct.

09:42

I can't find this client info. Have you heard of HubSpot?

09:46

HubSpot is a CRM platform. So shares its data across every application. Every team can stay aligned. No out of sync spreadsheets or billing databases.

09:55

HubSpot grow better.

09:58

Let's do one that was maybe incorrect.

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So we were bullish I don't know if we are bullish, but we are very fascinated on Bitcoin. Another thing that we are fascinated is I remember the day you told me about what an NFT was. When you explained it to me, I thought it was awesome. You're like, I just bought this Kobe thing, this Kobe card. And I was like, alright. That's kinda cool. And then things the world went a little bit crazy. For that one was actually amazing.

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Which is

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the like, it was it was genuinely beautiful to look at, whereas, like, n f t's then became, like, I got this rock I have the squiggle, and it was like, oh, okay. You know, like, you're trying to make a buck only. There is no, like, art aspect to this. And I think you paid five hundred dollars.

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I think I pay we paid

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seven hundred dollars or something like that, and then we flipped it for ten thousand, like,

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I don't know. Thirty days later. It was actually credit to Ben. So Ben was the one who

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got us talking to a bunch of NFT guys early on.

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And,

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You know, the right move would have been to just go, like, go crazy on it for a while or invest in the companies behind it. But I saw that this artist, everything like Boss Logic was doing one And the Kobe one looked great. I bought it. And then when I saw a seller for ten thousand, I was like, I mean, it doesn't look that great. Like, I I'll sell it to this guy and I can still look at it whenever I want.

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Well, so I was out of there. The other thing we talked about was Big Cloud. So Mark episode, a hundred and sixty four, March twenty six two thousand twenty one.

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I said, I signed up to this thing called BigClout because my friend Ryan Ryan Bighleman called me. And he said, this thing looks cool. Let's try it.

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And so we both, you and I both signed up for it. It was all the rage for a minute. It's a bit cloud. Ryan was on that episode. So he he kinda was pitching it. He called us before, told us to get on, and then he pitched it to us on the episode. So what did he say? So Big Cloud, by the way, it's basically a social. It was basically Twitter, but there was a crypto component where you could buy into someone's

11:50

Right. You don't just use it as Sam. You basically buy some of the Sam coin. And if Sam is gonna get more popular,

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other people are gonna buy the Sam coin as well because that's how you kinda cribe or follow the person. And so you could kind of we've all had this moment where you see somebody early on. You're like, oh, man, this person's awesome. They're gonna get big. And Bitcoin Cloud was organized such that you could do that. And it also had almost like because of that, it had a Patreon built in. It's like, oh, I already have all these kind of paying shareholders.

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I could

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just create content just for them. Only if you own x amount of my coin, you get to access this content, which is what only fans and then the Twitter, blue subscribers, and patreon, They all do a version of this. So it was like baked in from the start versus

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usually those are third party services. And it was a service. It was one of the very few crypto things I actually thought was saying. You said, you said, I think you're saying it's interesting because you Let let's do the Ryan one first. So Ryan goes, I remember when Facebook came to my college, and we were one of the first colleges. It was really fun. This is the first time I felt like that in a long time. That's why I wanted to come on the show.

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And then you jumped in. You were like, Yeah. Two big differences though. One, you didn't have to have money on Facebook. You just, you know, you just go use it.

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And two, like, you're putting money into this thing that we don't know the people behind this. We don't know who who how it's working. Like, It's a little nerve nerve wracking, and you don't even and there was no withdrawal button at the time. You couldn't even withdraw money from it. You're like, hey, red flag. Money can only go in and it can't come out. And then we were like,

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No. Don't worry about all that, bro. Like, there's downer over here.

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And and I said,

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here's Mike,

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I don't know. Is this a is if I don't know if this is a scam. It kinda looks scam y to me. And then I had found out who's behind it. They were anonymous at the time, but I had found out who was behind it when I asked around. I said, I do know the founders, they're legit people in the tech scene, and they do have a reputation on our circles. And they had. They had raised,

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I don't know, hundreds of millions of dollars from Andreson Horowitz and others, like, but And we had the founder on.

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Later, we had the founder on. And then and I said, you know, and what I liked about it, I was like, you know, today,

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If I sell on Amazon,

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I keep seventy percent of of what I of the value I'm creating being a merchant on Amazon. If I stream on on

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on YouTube,

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I'm keeping,

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you know, seventy percent of what I what I,

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actually not seventy percent more like it's like a sixty forty split of the of the ad revenue.

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Twitch, you know, roughly fifty percent. Then you go down to, like, Facebook, Instagram, Twitter, and the users at the time captured

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zero. Like,

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those were multi multi multi multi billion dollar companies that the users who created all of the content and consumed all of the content. The users did all of the work to create the value of the network. We're getting nothing. And I said, well, it does seem like crypto's kinda cool because it can it can change that. It can basically reward the people who do the work who create the content on the on these networks.

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And the second thing is we loved the growth hack. So what they had done was

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they took all the popular Twitter people, and they just prebought a bunch of their coins. So when I joined,

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I think there was, like, seventy five thousand dollars of value for me to just go claim.

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And I was like,

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okay.

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Push I'll push that button. Let's see what happens.

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And,

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and so they had used the money they raised to buy up popular people's coins and then to to claim your coins, you had to be, like, sign up for your account and tweet out, hey, I'm verifying my bit cloud, and that was kinda going viral for a bit. And that mechanic

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worked until it didn't work. And Bitcoin failed. And we know several people personally,

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Dharmash,

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and a few others that invested millions of dollars publicly into Bitcoin.

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And that one and so you, you know, smart people were doing it. It was an interesting idea. Ultimately, that idea failed. And so I would say, you know, we were excite. I I was more sad about it than you, for sure.

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You were, like, immediately. I think were pretty much out. Correct? Well, I I I was out, but I liked the idea of it. The idea of it was actually fairly interesting. Like, I liked to free money. Yeah. Well, no. Like, Twitter ended up doing it where they just, like, gave you money. So I get paid. I think three thousand dollars a year. It's on track for three thousand dollars a year for tweeting and, like, getting impressions. I that's cool, but you didn't need the crypto component of it. No. But that's different. You got you get paid a share of ad revenue.

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Me for following you,

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early on kinda being one of your early early believers,

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for retweeting your content for all that stuff. I couldn't I couldn't benefit from that. Right? Yeah. But it's the same outcome for me as as the creator. I get, like, I feel a little bit more bought in. Well well, no. Because What was your last Twitter check? Fifty dollars?

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Whatever three thousand divided by twelve is,

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three hundred dollars, maybe, something like that. Three it's four hundred dollars, maybe. Let's say maybe four hundred dollars. A bit cloud early on when it had, I don't know,

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fifty thousand users, something like that. Yeah. You owe us seventy five thousand. My account was worth seven hundred fifty thousand Like, you know, I could've I could've literally push the button and cash that out if I had one issue. Out of a little bit of it. Someone bought a bunch from someone's like, hey, I'll give you a Ethereum for all this. And I was like, yours.

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I sold it.

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So some someone wired before. The funny thing, do you know there's a new one that's basically the same model and it's crushing right now friends in tech or something? Friend tech. Yeah. I'm not on it right now just because I have been busy with other stuff, but it's I mean, it's generated, like, two hundred fifty million in revenue as a, like, as a for the project itself. And I think it's distributed the equal amount to to

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or people have generated that much on it as well. So then it sounds like bit cloud. Well, let's do an update on bit cloud, but it sounds like we are wrong about bit cloud. And that it Bitcoin didn't work. The idea did work in FriendTech.

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Right? I think I would bet that in the long horizon,

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let's call it twenty years,

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these networks will be built in with these networks will will do this. They will have a currency for the users on the network, and so the users will The users who contribute to the network will own and control the the network. So I do believe that it's gonna be true. Francech, I think, is, like, another kinda, like, attempt. I don't think it's probably the one.

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But I do think over the long haul, somebody will do that. So where's bit clout now?

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It they changed this thing called DesO.

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I think. Right? The Yeah. They're doing a bunch of stuff. I don't I haven't kept up with it, but yeah, Big Cloud, they were like, oh, that was just one app on top of the DSO protocol.

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And then the Diesel protocol had, like, many apps, the Diamond app in this app.

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I don't think any, on, the honest truth is I don't think any of it's gotten off the ground in a in a meaningful way. Alright. Pick a winner or pick don't don't pick a winner. Pick an interesting one.

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Okay. An interesting one. Okay. Clout Kitchen.

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So,

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way back, we did an episode. Let me find the I think we were talking about my cookie dealer and a bunch of other

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And you weren't there. So I came over to your office to record one day. You could make it for whatever reason, and you were like, oh, my buddy's Stu, who had been kinda listening to some episodes. Do

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was there. And he was like, I'll jump in. And he jumped in and he had a bunch of ideas.

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One of the ideas he had was he he goes,

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You know how Travis Calanic has left Uber, and he's got this idea of cloud kitchen. So he's like, you know, I'm gonna create these restaurants that are just built for Uber Eats, built for DoorDash, and there'll be delivery only. There's no physical location. Blah blah blah. He goes, well, there's a better he's I have another idea.

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Clout kitchens. And I was like, Clout kits. What do you mean? He he goes like, you know, social media guys who have clout, you know, they have this, like, you know, they have a big influence. He's like, I think they're gonna open up their own restaurant just like, you know, there's Margaritaville

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and there's, Gordon Ramsey has his restaurants or whatever. You're gonna see

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celebrities

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create their own restaurant brands. They're just gonna license their name and face to somebody.

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And then fast forward, like, I don't know, a year, year and a half,

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Mister Beastberger comes out. And mister Beast, one of the biggest social influencers,

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launches his own virtual restaurant chain exactly as Stuart predicted.

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And at the beginning, it looks great because the launch is insane. There's videos of people just like

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going and trying to to order this stuff. And I think it did over a hundred million in sort of gross revenue,

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you know, just sort of purchases of, from from Beastberger in year one.

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In year one, And so it looked like at the time,

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damn. Stu called it. Great idea.

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However,

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Cloud Kitchen's thing has a couple of issues. One is,

20:15

are really hard to control quality. Why why? Because the way these work are there's just mom and pop restaurants and they send the packaging to them. They're like, hey, If an order comes in that's in your area, you're gonna make a burger. Just make whatever burger you normally make. Just try to make a good burger, a good cheese burger, but wrap it up in this Beeseburger packaging and put it over here, the guy's gonna come pick it up. That's how cloud kitchens work. It just gives existing restaurants extra order flow. But because of that, you have

20:42

total, like, no control over quality because you have, you know, four hundred operators each making a different recipe, each with a different you know, sort of quality control around this. And at some point, mister Beast was like, dude, this is actually bad for my brand. People are ordering. It's, like, not not right. It's not good. Whatever.

21:00

Need to distance myself with this. And now they're in a lawsuit with each other because they're like, nope. You signed the you signed your rights to to us. We're gonna keep calling at this. And, you're hurting our business by saying that. And so now he he can't really talk about it. So it's not a failure though. I mean, it's a failure for him. It's poor execution, but it it could work. You know, it just so happened. He was the biggest, you know, at the time or still is, and it got too big, too fast. That doesn't mean he's a bad, a bad concept. And I think if someone's gonna do this, you could do this. You just need to, like,

21:28

have a much more controlled skew. So somebody needs to do it with, like, just like,

21:33

I don't know, cookies or they need to do it with a,

21:37

like, they need to do, like, you know, what's it called? The edible Elite edible arrangements or whatever?

21:41

It's like, here's a gift you can send somebody.

21:44

It's like, you know, you need some celebrity who's going to

21:48

just, like, create the version of edible arrangements on top of DoorDash or whatever. Just like this gifting

21:54

thing.

21:55

That's, like, can be more consistent. So maybe you could just send the final thing to each location.

21:59

I think Reed told us on the pod when they launched a Beastberger

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He was, like, me and Jimmy were just, like, in a bedroom. We threw it together in ninety days. Like, he made it sound, like,

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pretty ragtag. Like, it was just, like, Oh, let's just throw it out there and see what happens. I don't I don't know if that's the truth. That's the kind of the energy that was implied.

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And,

22:18

you know, so it just didn't work out for execution reasons, but it could still happen.

22:24

Okay. Here's one that we were, okay, I'll give you two that I was right, but pessimistic about.

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So,

22:31

Clubhouse.

22:32

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I wrote a Twitter thread that was kinda like the thing that blew up my Twitter for a while.

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I wrote a Twitter thread that basically was telling people why, like, clubhouse was the hot name at the time. It was it went from, like, nobody was on it to

22:46

The cool kids are on it too.

22:49

This is,

22:50

you know, a two billion dollar company,

22:52

all over the course of, like, a, you know, less than a year. Right? This thing was just, like, flying.

22:56

And it was, like, oh, this is the next social network, and all the big names were believers in this thing. I remember,

23:03

I remember being, like, I enjoyed being on it, but I was like, oh, this is not gonna work for certain reasons.

23:08

And then I would hear really smart people, you know, Mark Andrews, invest in this thing. Andrew Chen, the, you know, the social guy. Oh, he's investing in this thing. Then you hear Navell, who's an investor in it, and he's like,

23:19

this will be bigger than Twitter.

23:21

And then, you know, Saw Hill from gumroad. I remember listening to him on a clubhouse thing, and he's like,

23:26

clubhouse will be bigger than Twitter because everybody can speak and not everybody can write. And I was like, that's not how this works. You can't just be like, my app, it's called breathe, and everybody breathes. I'm gonna be the most valuable company. Like, I was like, what is this logic?

23:40

And I wrote this thread. I said, hey, everything's close. It's gonna be the next big thing. I think it's gonna fail. And here's how I think it goes down. I wrote this thread. The thread goes viral. Yeah. You had, like, celebrities

23:51

reach out. Isn't that how you met? Huston Minhage and who else? Yeah. You're so. There was a bunch of people that were, like, you know, I don't wanna, I don't wanna, like, drop. You know what I mean? But, like, yeah, there was it was crazy. It was people that I admired. Yeah. It was like your heroes. I don't I mean, like, I, like, some of these podcasts, the sports podcast,

24:08

guys. Yeah. People who were famous, you know, authors or or writers or whatever. He either followed or DM being like that's well, that was so so so good. So it was good. That was great. But

24:18

I also got blocked by a bunch of VCs who were in bed market in recent blocks. Me, they're, like, you know, you know, they go from following to blocking, like, instantaneously. Why? Cause I, like, know, I told them that maybe their investment wouldn't work out. And,

24:31

and I got some hate. Some people were like, oh, why are you rooting for a startup to fail? I didn't say I'm rooting for it. You're actually in the thing. You said, I don't want them to fail. I just have experience in this space, and it doesn't I I don't think it's gonna turn out nicely.

24:43

Yeah. But I think rightfully so people don't believe that where it's like, look, I wish you the best. They say that, like, when they're fighting, like, look, I wish you good luck. And it's like, no, you don't. But I think, you know, fast forward. I don't know when that was. I think that was twenty twenty one. So fast forward two years now. And,

24:58

I feel like not just was I right that clubhouse failed.

25:01

Step by step because I was like, this is what they're gonna do. They're gonna realize that this doesn't, like, that they can't grow the thing this way. They're gonna then launch a recording feature because they're gonna say, You're missing the live show, just record it. We're gonna optimize towards people creating shows versus people just hanging out, and they're gonna try recording. And then no one's gonna watch the recordings.

25:20

And then here's what they're gonna do. They're gonna be like, we looked at the data. And, actually, yeah, people don't watch these recordings because the what makes a great live show isn't as good in it. Is it a well edited recording?

25:30

So then they're gonna be like, you know who really uses this? People who hang out and make friends on this. And we're gonna switch to a hangout product. And sure enough, they switched to a hangout product. And they did basically each of the steps except for the last one, which I predicted was, like, you know, they end up sort of fire selling it to Facebook for, you know, whatever, seventy million dollars. And then he becomes a product manager of Facebook. Like, You know, that part hasn't hasn't happened yet.

25:52

But pretty much step by step. So that one was was a right

25:56

but pessimistic.

25:57

And, you know, I guess one takeaway is

25:59

it doesn't really matter to be right when it's pessimistic. There's no nothing really that great comes of it. You know? You kinda look like an asshole, even if you're right. Yeah. Exactly. I'm like, and then I'm like, oh, great. Now I'm like, yeah, I told you they would fail. And it's like, oh, okay. You know?

26:15

Speaking of things that you say that you don't really mean, did I tell you about that time that a kid flew in from England? No. What?

26:23

One time when the hustle was getting started, this kid called me from England, and he goes, I love the hustle. And I was like, alright, let's talk I started talking to him, which is bullshit. At the end, I go, Yeah. If you're ever in SF, just let me know and and we'll help you out.

26:34

And I meant it as, like, a way to end the conversation. And I learned at that moment, you should never say that. I get a message three weeks later. And he goes, hey, Sam. It's the guy from England.

26:46

So my flight lands my flight lands tomorrow

26:49

And he just shows up. It

26:51

and we have Hussicon, like, my big event, and we make him work the whole event. And we're like, here, you could sleep on our couch. And we dressed him up in a Texas outfit. He'd never been to America before. We gave him cowboy boots in a hat that we had in an office, and we called him Texas Sam the whole weekend. And he stayed with us for five days all because of the phone. I was like, yeah, you know. So now I don't say those things anymore. If I don't mean it, I try to say it. That sounds like an amazing experience. That sounds awesome.

27:15

It was only no. It could have been it could have been better. Lemonate out of lemons situation for you.

27:21

Well, it it it was it it could have been horrible. What was the other one? You had two. Was it Thrasios? Thrasio. Yeah. So Thrasio was this company that was buying up all the buying it was a rollup, an aggregator of Amazon

27:33

Amazon brands, Amazon. One of the fastest growing startups ever. I think they went from zero to a a billion dollars in market cap or a valuation in, like, twelve months. And tons of revenue and then tons of copycats because everyone was like, oh, Thrasseo, one of the fastest growing startups in the world. We're gonna repeat this.

27:49

And, And we had friends who did it too. Some of our friends went and did the same thing where they bought a bunch of Amazon businesses.

27:55

May they rest in peace? But it didn't work. Right? That's the the problem. So, you know, I remember calling Andrew Wilkinson. And I was like, yeah. What do you think about this thrazio stuff? And I was like, I was like, I kinda get it because, you know, they're doing,

28:08

you know, like, roll I think roll ups in general are just like a

28:12

a really nice blueprint for a business.

28:14

This roll up kinda makes sense. Andrew had done a semi roll up with,

28:19

Shopify apps. And so I was like, do you see this as, like, you know, a really good opportunity. What do you think? And he goes, I think they're picking up pennies in front of a steamroller.

28:28

And I'd never heard that before, but I guess that's a phrase, like, a, like, a Charlie monger type phrase. If Andrew says anything interesting, it most likely came from Charlie Monger. That's a zero.

28:38

And Charlie is, like, has wonderful phrases. So most of the stuff most of the wisdom he has is from Charlie Munguer. And I go, what do you mean? And he's like, it's like picking up a penny in front of a steamroller. Like, you know, you're pick them up, you're picking up these little kind of, like, what seems like these little cheat free cheap assets,

28:52

and you think it's all going well until you get completely run over. And if you fast forward till today, that's pretty much exactly what played out. These guys bought up a bunch of businesses. They rolled up what looked like a lot of revenue.

29:05

And then they got run over. And at the time, we did an episode.

29:09

And the things we had said were basically,

29:12

so I basically took Andrew's point of view. And I was like,

29:15

that does

29:16

feel more right than the other way. And I said, well, what what could be the problems? And I was like, basically these FBA businesses are not very durable. If you're gonna do a roll up, you kinda want durability to be one of the highest

29:26

characteristics. Like, normally in business, we think growth is the best thing. But actually, when you're buying businesses,

29:33

it's more about not being wrong than it is about everything going right. And so you want durability when you're rolling these They bought trash. They bought, like, they would buy, like,

29:44

one of the thousand vendors on Amazon selling Chinese dog leashes. For twenty five dollars. You know what I mean? Like they I think they bought trash. So, like, you know, Amazon,

29:54

is not durable for many reasons. Number one,

29:57

the, you know, like, the your your spot in the rankings for these commodity products really matters. And, like, it's a constant battle to keep to to get your ranking to stay high. Which includes things like people going and leaving fake reviews on your thing so that your account gets taken down. Like, oh, let me just spam you with reviews so that Amazon detects you and then delist you. Right? That's just shit like that or copycats or people who pay more or whatever.

30:21

Then there's Amazon themselves launching basic. So for every good category, Amazon's like, cool. Here's the Amazon basic. Oh, what do you know? It's at the top. Right? Like, that was also happening. Then there was the last thing that sort of the death blow, which is Andrew at tiny, they sort of believe

30:36

what I think a few other

30:38

of these, like,

30:39

hold code types believe, which is that synergies are massively overrated.

30:44

That, like, it's very easy to talk yourself into. We're gonna buy these five companies

30:49

And then synergy. And it's like, what synergy? It's like,

30:53

we're gonna centralize

30:55

the back office, and we're going to

30:57

cross promote with each other. It's like, no. Actually, none of these brands had enough brand love for you to cross promote anything. You did nobody trusted you.

31:05

The synergies in the back office actually just turned into, like, a bunch of people not really watching what was going on in these individual businesses the way they were when it was just one person owning them. So what's the update on them? So Thracity was basically dead.

31:17

It's I don't know if I don't know exactly what the stage is. Is it? It's either in Fire sale bankruptcy, but it's dead. And so are all of the aggregators. And so now there's, like, the opposite phenomenon.

31:28

There's, like, a deloading, and which is actually probably a better opportunity to go pick the best ten assets from all these aggregators who are completely underwater, and they just have to, you know, basically get rid of all these assets. And so

31:40

yeah, thrazio and all the thrazio copycats did not work out. Alright. I'll tell you one that we

31:47

I wasn't exactly right. And the times that this turned out to be true, it didn't play out how I thought it was going to. So something that I talked to you about, I think since two thousand nineteen, two thousand twenty,

31:57

was privacy. So if you look back on some of our episodes when we are still in their old office, so this was two thousand nineteen.

32:04

I had this insight from the founder of Pandora.

32:06

So Pandora is the music service.

32:09

The founder one time told me he was like, yeah, like, most many of our users are like middle of America, like, dentists who, like, have Pandora playing in the background.

32:18

And what we've noticed about them is they sometimes won't sign up because they don't wanna click the link that says they agree to our terms and services and our privacy statements.

32:27

And to me, that meant

32:30

The average show cares more about privacy than a lot of people think. At the time, two thousand nineteen, the privacy wasn't that big of a thing where

32:38

you you just click yes no matter what.

32:40

I think that that and and so I predicted there's gonna be a lot of businesses that are gonna be created on top of that Another example that I had was duck dot go. Duck dot go is a privacy search engine that doesn't, like, track you in the same way Google does.

32:53

Their searches have gone up like crazy, and the business has gone on to raise a hundred million dollars, which most of it, I believe, was a secondary sale. So they're quietly killing it. But I thought that this was gonna be more popular than it has been. It's kind of gotten popular because TikTok,

33:08

so I'll I think in Minnesota,

33:10

it is or,

33:11

Montana. It is,

33:13

they have banned or are trying to ban TikTok for privacy reasons. They're mostly doing it because they don't like China, not because necessarily

33:20

this is where I was wrong. It they're they're doing it for the Chinese purpose, not exactly the privacy purpose,

33:25

but I thought that this was, by now, gonna be a lot more popular than it is. It's slowly

33:30

growing, but it it's not We don't care if you give up all your data, but you better give it up to an American company. Yeah. It's better give it up to us. Yeah. So that has that. We didn't I I didn't mail that yet. I but I I'm I'm still I'm still holding out, but it I thought by now it would have picked up a little bit, but it hasn't. Tom. I'm gonna give you one that, we got right and wrong at the same time. Meaning, we did an episode back in twenty twenty.

33:55

July of twenty twenty. COVID has been, like, raging for three months,

33:58

and we do an episode

34:00

called is GPT three the next big thing. Episode number ninety four. We're, like, in five hundred now. This is ninety four.

34:07

And

34:08

we had gotten access to this tool called GPT three, which at the time, you had to, like, get an API key. They had to, you know, borrow that. You had to get get a friend to get you an invite to get GPT. And it wasn't that good. It was okay. We were pretty stunned by it mostly because we're twelve year olds, and we,

34:24

like, made it right, like, a rap song in the form of Cardi B for us. And we like, this is hilarious. This is amazing. It just wrote a wrap. Like, this wrap is actually good. I I said write a wrap

34:34

by cardi b in the title of the wrap was walk that plank, and it was a very long it was like it had rhymes as if Cardi B was saying it. It was very very rocky. And we were both so impressed. And we were like, this is amazing.

34:47

And we were we were basically like, hey, this is a super cool,

34:51

And we so we correctly.

34:53

Back in July twenty twenty,

34:55

before Chat GPT became the fastest growing product of all time, before Open AI became a hundred billion dollar company,

35:03

before AI was the tr was the trend.

35:06

We set we released an episode with title is GPD three the next big thing. Answer was yes.

35:11

However,

35:12

I count this as an l. Why?

35:15

Because we just giggled about the rap lyrics and didn't do shit else. We didn't do anything about it. You know, the move. The the the optimal move was drop everything and go work for Open AI. Is this actually what you said? You said in one of the episodes. You said if I'm smart, I should drop everything and go work in that area. And I'm not smart. Turns out. Right?

35:35

Then I proved to myself that I was not smart. I could've there was a hundred ways to make a hundred million dollars with this. I could have started a company using GPT three as the the backbone, which the guys from Jasper did. They were like, oh, Let's use this to help marketers

35:51

write blog posts, write tweet storms, write, captions, write anything. That story needs to play out still, though. Yeah. But they built a company that, like, got to one of the fastest growing companies I've ever seen, like, getting ARR over fifty million dollars one year is, like, insane.

36:06

And so could have started a company, could have gone inward for OpenAI, could have invested

36:11

in the Open AI spinouts, like anthropic, which is now a twenty billion dollar company. Or, you know, name the go through the list. Could have,

36:20

what else could I have done? I could have just yeah. So between investing, starting a company or joining a company, there was a lot of different ways to

36:28

capitalize

36:29

on that opportunity that we identified.

36:32

But I didn't. And I think this has happened, you know, many times where you sort of, like,

36:37

you the opportune either the elephant in the room is the opportunity, and you just sort of, like, oh, that's cool. There's an elephant over there. Versus being like, oh my god. Wait. Stop everything I'm doing and let me reassess what I'm doing in order to What's this analogy? You kill the elephant? Are you gonna kill the elephant? Look,

36:52

Look. You know how it is, those analogies on the fly.

36:56

Sometimes you gotta weave two and two together.

36:59

Do you kill the we gotta kill times the elephant needs to strike while the iron's hot. Now you gotta know that they look at the striking iron. Right? Like, we don't know. The elephant's in Rome, my friend. It's like that Michael Scott,

37:09

that Michael Scott episode of the office where he's like,

37:13

sometimes I just start a sentence and I have no idea where it's gonna go.

37:17

That's podcasting for you. Okay. So,

37:20

let me preface this. I one of the things I like to take pride in is either hiring people because before they get, like, before they kinda reach their the the pinnacle of the career, I also like this on the podcast when we find interesting people, and we talk about them A lot of times they're still popular, but we got them we got them before the curve.

37:40

One of them was Andrew Huberman. We interviewed Andrew Huberman I forget exactly when, but when I remember when he interviewed us, he was just using his Air Pod headphones, looking at his laptop, like, it looked like he was in a like, a bathroom or something. Like, he, like, was, like, as if he was, like, ran to, like, some room, you know, he wasn't, like, a big deal. So that one was a cool one. I got somebody here that this is all you. So you come on the episode one day and you go, you just got Brian Johnson. I'm like, nah, not really. You're like, You know, Venmo? I'm like, yeah. Of course. And you're like, well, it's owned by a company called Braintree. You know, Vaintree? I'm like, guy, vaguely, payments company something.

38:14

And you go,

38:15

Listen to this guy's story. So this guy's story is basically

38:18

Brian Johnson.

38:21

I'm not gonna do his whole life story, but, like, interesting kind of early on, door to door sales type of guy ends up creating a tech company,

38:28

Braintree buys Venmo, sells Braintree to PayPal for, like, seven hundred eight hundred million dollars

38:33

creates this,

38:35

like, neural link type of things, brain reader, and you're like, but Forget all that. I'm like, forget all that. That was a lot. That was amazing. You're like, forget all of it. Go to this website, blueprint dot bryant johns dot com. And I go And it's like size six font. It looks like I'm reading from a, like, a textbook,

38:51

and you're like, this guy is measuring every part of his body.

38:55

Every single organ.

38:57

He is measuring it, and then he is optimizing it. And he's doing crazy shit. And look at this. He's been doing this for, like, a year. And I had never heard of this. Most people had never heard of this. Brian Johnson now, I would say, like, I think he's kinda tipped where, like, actually, in the tech industry, everybody knows about him. Yeah. I don't even make some mainstream people. The the the calm the guy who's trying not to die or something like that. Oh, that guy. Yeah. I've seen him. He looks weird. Right? Like, it was like the, like, because I bring him up in, like, every conversation I can find and excuse you because he's fascinating. And people are like, that's great. Oh, I don't I just don't feel like that's gonna work. Right? It's like a very polarizing thing. But you found this early and you were watching him. You were, like, talking about it. Then we got him on the pod early. It was great.

39:36

And we're about to release a new another episode. I went to his house. We've recorded another one, but, like, I feel like you spotted this was your a Uber angel investment. Right? You spotted Brian Johnson

39:46

way before anybody else was really paying of it. Let me explain the story. It's been long enough. I can tell the story finally. Here's how I found out about Brian. I I I can't name names. I have a friend that was going on a first date with this lady. He had just met. And he goes, hey, Sam. I'm gonna take this lady. She seems awesome. I'm gonna take her on a first date. I'm gonna take her I have a little plane. I wanna take her up in the plane, and we're gonna fly around f one. You know, f one was in Austin. We're gonna go above the stadium and it's gonna be an ordeal. Would you and Sarah like to come on this double date? I would love it if you'd come We said, yeah. Sure. Sarah gets sick, and I text him. I go, Hey, man. Sarah's

40:20

not been anymore.

40:22

But I also go And so

40:25

I go Third wheel.

40:27

I third wheel

40:29

on this date, and we go on this date. And she's a lovely woman, whatever.

40:34

And she it wasn't trying to be cool, but

40:37

I was trying to hype up my buddy. And I go, hey, lady, have you

40:41

You ever been on a plane on a first date? Like, this is pretty cool. She wasn't trying to damp the mood or, you know, like, rub it in this guy's face, but she goes, oh, yeah. You know, this other guy used to date it. He he liked to fly.

40:52

And we're like, so we asked a few more questions. I'd be like, what does he fly? And she named some jet that's like a forty billion or forty million dollar jet. And we're like, what? And she's and and then she says something like, yeah. But he likes to fly it himself, but he has a staff. And we're like, who the hell is this guy? And so I Google it, like, who this person is, and that's how I find Brian. It was she used to date him.

41:14

And

41:14

that's how I find out about him, but I used to start googling and I come across blueprint that he just launched a few weeks prior. And I'm like, Right. This guy's amazing. That's how I found Brian Johnson.

41:26

How did that date go, though?

41:29

I didn't work. Let me just decision by you to join the date. Like, join the date. Dude, it's them.

41:35

Them too in the front two seats and be in the back. And

41:39

and I have that sitting in front of, like, putting my hands over there, like, Hey, guys. Like,

41:47

it was so funny.

41:49

I had never been up in a plane like that. I was like, Can I pass this out?

41:54

I still go.

41:56

And I was pipping him up the whole time. I was like, hey, a guy, Have you told lady, about that one time? You did this amazing thing. But you're doing through the plain headset thing, which is, like, you have to yell. Yeah. But I'm still leading up.

42:16

Did you tell her about the time that you paid for everyone's dinner? It was two thousand dollars. Roger.

42:21

Yeah. I was like

42:23

I'm trying to, like, pick them up I'm wearing this headset.

42:27

You're, like, pointing out. Like, hey, we could go there next week. Yeah. I was, like, hey, guy, did you tell, lady about the time that you had the, box seats at the f one, and you took all of your friends because you're so nice.

42:38

Yeah. It was like that type of thing. It didn't work out though. I tried my best guy. I'm sorry. You know who you are if you're listening to this. That's, that's hilarious.

42:47

You,

42:48

you had a couple more on here. I don't know if you have time, but you you had a couple more on here that that looked kinda interesting. So you had,

42:54

42:55

paid communities, and then what's this inertia one? Let's do inertia. Okay. So you this was you you you talk a lot.

43:02

That's no surprise. But every once in a while, you say something that's pretty profound. One of the profound that you said, it stuck with me. This was in two thousand twenty one, March of two thousand twenty one.

43:13

You had this episode,

43:14

where you it's just called inertia, I believe. And you said,

43:18

Inertia explains, like,

43:20

Inertia explains why ninety percent of people are doing what they're doing. In my life, I've had moments where I realized Inertia is a bitch. Inertia is the reason why I'm doing these things. Not not actually because I want to, but because of inertia. And oftentimes, I've gotta check myself and asked myself if I'm really doing the right things. And I think that you were referring to a business that you had previously sold, where it wasn't doing that well. And you're like, Do I even believe this is a big opportunity? Would I even be doing this if I weren't already doing it? Would I've hired these same people? Would I work with these same people? The answer, at the time was hell no, and that's when you decided to get out. So my question is, a,

43:57

no question, comment. That was good. That was a really good insight. But question number two,

44:02

you've since sold a business. So you started and sold a business, I think, post this comment. Yep.

44:09

Do you still you like, do you still think about inertia?

44:12

All the time? And by the way, this

44:14

this came to be think about inertia. Yeah.

44:17

The Roman Empire for some guys for me. It's inertia.

44:21

This happened because I had to come to Jesus moment. I,

44:24

I was with our buddy, Sully, and we went we used to go in San Francisco. If you drive, like, thirty minutes down, south out of San Francisco,

44:32

there's these, like, casinos that are, like, half casinos.

44:36

Yeah. So we go down there.

44:38

And, we're hanging out. We're playing. We're having a good time. At the end of the night, he's like,

44:45

he's like, so why are you he's like, so I don't get what you're doing. And I go, like, casino? What are you talking about? He's like, no. No. No. This whole thing you were because I was at monkey and friendo at the time. And to the outside,

44:56

what I was doing

44:57

was the greatest job ever. If anybody you've ever seen, you've seen our office, monkey Frano. It was literally the nicest office you have ever been to in your life. I called it a billionaires playground is what it was. And that's what it was. He literally built his a billionaire, literally built his dream office, and we just got to use it. There's a chef every day, and there's a gym, and there's But it's, like, for only the fifteen people that we were there. That is about Yeah. And then you had twenty or fifteen. Yeah. Twenty or fifteen engineers who are paid really nicely, and you guys do whatever you And the job was, Sean, you get to come up with any idea you want. Here's a team of super talented engineers to build them in designers.

45:30

Here's the funding. You never have to go raise funding.

45:34

You you get paid salary and you own the equity.

45:37

You can by the way, you don't even wanna do you don't wanna focus on one. Go ahead. Do four at a time. Filled four times. You have enough resources. Go ahead. Do everything. Right? And I'm twenty five years old when he twenty four years old when he names me CEO. And

45:49

At twenty four,

45:50

that was the greatest opportunity, the greatest experience ever. At twenty five incredible opportunity.

45:57

Then I was twenty nine,

45:59

and I was still doing the same thing, except for

46:03

now the pressure of, like, succeeding

46:06

Like, at the beginning, it was like, dude, this is gonna be awesome. We're gonna we have so many shots on goal. We're gonna do it. Then we took a lot of shots on goal. And we made some good things happen, but no big huge win. Is what we were all going for. And by the end, we were really trying to, like, force a square peg into a round hole. It just wasn't working. But our mandate was like build the next Twitter. Build the next Snapchat. It's like, dude, that's really fucking hard to do. But like, okay. We're gonna keep trying.

46:29

And so I got this talented team in this beautiful office.

46:34

I'm CEO. I'm getting paid well. I got equity. I got everything you would want. And here's my best friend, the guy looked up to saying, what the hell are you doing? And I was like, he's looking at me like I'm a junky. Like, dude, what are you doing with your life? And I'm like, what are you talking about? This is amazing. Of course, this is amazing. Right? And he's like, how much money you made back then? And I think it was, like, low six figures, like, over it was over a hundred thousand dollars, but less than two hundred thousand dollars. And I remember when you told me that, I was, like Speaking. One sixty at the time. Yeah. I was, like, that's the most money of anyone I know, like, You have a hundred thousand dollars. Like, that way, it was huge. I remember you told me that amount, and I was like, you're so huge. It was huge to me too. I was like, this is amazing. Then I and then I was like, and if any of these ideas hit This is great.

47:13

So he he's talking to me. He's just like, I feel he's like, I feel like you're just doing the same thing over and over again and not getting a result you want.

47:21

And I was like, he's he basically asked me a very simple question. He's like, you know,

47:26

if you weren't

47:27

already working on this project, if I just took the project away,

47:31

I see, if tomorrow, this whole company had to fold because, oh, they forgot to pay their bills and whatever. This folder. Tomorrow, would

47:37

you pick up the phone, would you call these same people and say, hey, we're still doing this idea. Right? That's the biggest idea we could possibly think of. It's the one we must do.

47:47

Would you call these same people to work on the same idea? And my answer was, yes, the same people, hell, no, not the same idea.

47:54

He's like,

47:55

He's and I was, like, that's kind of a shitty realization to have. It's, like, and I was, like, am I an idiot? And he's, like, no. He's, like, this is common. He's, like, inertia is a bitch.

48:05

And he's like, almost all of us are just doing what we're doing because we were already doing it. And, like, this this even happens with investments after we got acquired

48:14

I got a bunch of Amazon stock. And so my portfolio was, like, super skewed towards Amazon. I was, you know, all of a sudden, here's millions of dollars of Amazon stock. Okay.

48:23

If if you're just giving me the billions of dollars, I wouldn't have put all of it into Amazon only.

48:28

But because it was already there, I was like, should I sell Amazon? I don't know. It's a good company. Right? It's like, Because it was already there, my decision was totally different than if I had just rewritten the the decision from scratch, saying if I if I just had this money today, is this exactly how I would allocate it? It the same thing happens to your portfolio as happens in the time of your life. Like,

48:48

would I would I allocate my energy and my talents to this project? Or am I just doing it? Cause I've been doing it. If I'm just doing it because that's what I'm already doing. And I think the sad answer is that for most people, they're doing what they're doing because they're already doing It's not the thing that if they had a blank slate today, they would just go back and recreate this. That's the same argument my wife gave to me about selling HubSpot stock. I've not sold any. And she was like, well, would you buy this stock anyway? My argument was

49:13

well, first of all, I I do like the company, but do I like it enough to have that much of my portfolio in it? I I don't know, but my argument is like, well, but I don't wanna pay taxes. And frankly, I'm not sure if that's a good argument or not.

49:26

But I I am a victim of it as well.

49:29

Yeah. Yeah. Of course. Is that right? There's nuances to some of these things, but, like, That same principle just applies to a lot of parts of your life. A lot of people are in relationships. They don't wanna be in because they're already in the relationship. They're in jobs. They don't wanna be in because they're they're in it. And,

49:42

I just kinda had this, like, it was two AM, and I'm in this Chinese casino, and my friend is telling me this thing. And I remember we drove to our office a badge in it, like, two thirty in the morning. We go to the whiteboard and we say, we're gonna spend the next hour trying to figure out if we can actually make this company work. And if at the end of this hour, we don't look at a plan on this whiteboard that we feel is, like, this is gonna work. Like, I believe that this is worth a shot. Then I'm gonna sell this company. Like, tomorrow, I'm just gonna get out of this company. And then at the end of that hour, we looked at it. We were like, this is, I mean, these are all just, like,

50:13

random long shots that, like, we can't sit here and say we have a ton of conviction in. And then, like, the next day I talked to our main investor, I said, I think it's time to to shake it up. Like, I need to shake up something in my life. This is all beautiful. This is amazing. I can't believe you gave me this experience, but, like, I don't want this anymore.

50:29

Let's either sell the company or you should replace me or something. Something's gotta change. I can't unhear what I heard last night. And,

50:37

I have a lot of flaws, but the one good thing I have is that

50:40

once I hear the truth, I

50:43

just act on Like, I just agree that, like, I've heard the truth now and that's it. There's no going back from that. Whereas I think some people will see or hear the truth and then they'll go into denial or they'll delay. And I don't do denial or delay. That's a good one.

50:57

Yeah, I always,

50:58

I thought that that line inertia as a bitch I I remember that one, so I had to bring that one up.

51:04

Maybe the last one is paid communities.

51:07

So I've been interested. There's a there if you listen closely over the last five hundred fifty episodes. There's, like, two to three things that I've, like, have been obsessed about. And I knew I was gonna act on one of them. I acted on one of them. It's a paid community. So

51:20

By the way, I think Can you say the two or three? What are the what would what would be the two or three?

51:24

I I

51:25

helping people find jobs. So I call it job boards. It's beyond that, but I've always been fascinated by that.

51:32

And then creating,

51:34

like,

51:36

somewhat related, but I was I've always been fascinated by the trucking industry

51:39

or other, like, blue collar essential jobs that aren't don't have a lot of technology or software in order to help them be more efficient.

51:46

So the the those are like two or three things that I've always really liked. And then, of course, b to b media companies and database and research businesses.

51:53

But the other one that I really loved was paid communities. And if you listen closely, starting in two thousand twenty, I did a lot of breakdowns

52:00

on different paid communities. So I mentioned Tiger twenty one Vistage, which, has since sold. So I I talked about Vistage. A lot of people didn't know what Vistages. It's like similar to what Hampton does. It's similar to what YPO does, but the target market is,

52:13

CEOs and business owners of, like, plumbing companies,

52:16

in the in middle of America.

52:18

Doesn't sound that huge, but it has since sold for about one point eight billion dollars. I think about eight or ten months ago. It was due and now it's doing close to five hundred million dollars a year in sales, very profitable.

52:28

And so I talked about

52:30

paid communities, and I talked about Tire twenty one, a few other ones. Here's the I I made a list of pros and cons back in two thousand twenty. So this was March two thousand twenty. And I'll tell you if I think the pros and cons are true since I've now run hampered for about one year. So pros are paid paid communities.

52:45

They can grow quickly. They seemed fun to run if you're interested in the topic. You don't need a lot of money to start them. They definitely seem profitable.

52:54

And then the cons were, a lot of times they don't scale that well. I think churn could be pretty, pretty high

53:02

And those are, like, my two main cons. So the truth is, is that they can grow quickly, but you don't want them to grow quickly. You want them to grow slowly. So I was a little bit wrong about that. Can you start them with zero money? Zero dollars? Yes. I started Hampton with no money. We didn't even buy a website. Or domain name.

53:22

Can they be very profitable? Yes. The answer is yes. They can.

53:26

What I got wrong or didn't mention was how meticulous you have to be about growth.

53:30

And

53:31

they can get big, but they just take longer. And that's okay. Because I think if they take long usually, not always, if something takes longer to grow,

53:39

Maybe that means that it's gonna die.

53:42

It has it's less likely to die quickly. Example, Thauracios.

53:46

Groot quickly, probably he's gonna die very quickly. There's a lot of examples of that. And so it has, in fact, proven to be a big business or it can be a big business. It's harder to grow than I thought but not because of demand, but because you don't want it to grow quickly. You need it to grow slowly. You have to be really thoughtful. So I underestimated how challenging that is

54:06

but I did a lot of the work in front of people. I I I would have thought that someone was gonna launch this. I even interviewed.

54:11

The funny thing is the funny thing is you You invited a couple of

54:16

other Pain community CEOs on the pod as guests, ask them a hundred questions, and then took their lunch. And I just find that to be an incredible story that I look forward to telling, as this plays out.

54:28

I I needed to work. I need to work first. At the time, you had a community called Club LTV, which was an ecomm community. I I think it was making a hundred thousand dollars a month. Pretty much right away. I think you actually that name is wonderful.

54:42

It was, it was free. I didn't charge for it. But it was like, invite only. Like, I basically, that was

54:48

I was running an e commerce business, but I'm part time in it.

54:53

And

54:53

I've never done e commerce before.

54:55

And so I have a strategy of, like, if I'm gonna do something that I don't know how to do,

55:00

There are hacks to learn faster. One of the hacks is surround yourself with other people who are doing the playing the same game

55:07

at one to two levels above where you're playing it, meaning they're one to two notches better at it than you are and further along than you are.

55:15

And so when we wanted to grow big on on Twitter, I think both of us had a similar idea. We created a group a text message group called the hundred k club. And we invited six people who all had that same goal. And then we all talked in there about,

55:27

initially, like, stuff we were doing to make that happen, then we all just became friends. But, like, immersion

55:33

into a small club of people who play the same or playing the same game at a one or two notch higher level than you is one of the one of the hacks to get better at something faster. And so Club LTV was cool. If I just create a curated group of awesome e commerce owners,

55:50

I'm gonna learn a bunch of shit that I need to know to make my own thing successful. So I'm not even charging these people,

55:56

because I don't need to make money off this. I want the information. I actually wanted the network from it, and that's exactly what I got out of it. But you made money through advertising.

56:05

And so we have sponsors.

56:06

Yeah. And that model actually works. So there's a company called Aventa, who does this, but they did it with, like, chief information officers. So these are, like, fortune five hundred and They were making,

56:16

they they sold for seventeen times profit for two hundred fifty million dollars. So they were making, I think, fifty million in revenue, and then whatever that profit is, I can't do that math.

56:24

But they so so that model that you had, it works. The downside,

56:27

which I don't think you you knew getting into it, logistically,

56:31

there's a it's it's a very operationally

56:33

heavy business.

56:35

It's very, very challenging.

56:37

It's not ecomm is also operationally heavy, but it's more so, like, there's, like, three or four things that you have to nail. With people, there's, like, way more things. There's, like, people's feelings that you have to, like, account for. And it's a little bit more of an It's actually quite challenging to hire,

56:50

help for that type of business. But you are on to something, and I actually think Another way, I think that one was a business that could have totally worked. Me and Ben, I remember we just had a conversation like, hey, do we wanna actually turn this into a business? It can. It'll work. It would be profitable.

57:04

We just saw better opportunities for ourselves.

57:07

But, like, that's one where if I knew the right person, I would have totally just handed over Klevel T. V. Cabel T. V. I'd be like, you're the operator of this now.

57:13

There's a clear path to make this a business. There's, one called e commerce fuel that's out there that's kinda like the Which I love. Older version of this. Subscriber.

57:22

Really? Why? Why was you you didn't do e commerce?

57:26

I just thought it was awesome. Andrew, the guy who started. I used to read his blog, and I thought it was sick. It was three hundred dollars a year, I think. He listens at the and I just talked to him every once in a while. I just thought it was cool. I thought e commerce field was great. In fact, I was a paying member in Moiz Ali,

57:39

this very rich successful guy.

57:42

Sorry, Moiz. I'm gonna blow your cover. He used to use my account because he didn't wanna pay three hundred dollars a year to he he would use my we would share a password.

57:52

So, like, it's pretty funny, but I liked e commerce too. I thought it was great. It's still a thing, and he limits it to three thousand people, I think. Right?

57:59

Something like that. I don't I I don't actually use it because it's a forum and I don't really love like forums and there's like live events or whatever. I I like the way we did it with Club LTV. I thought that was more more fun and easier, just easier to, like, actually participate in.

58:14

So anyways, I thought that, yeah, that that definitely could have been a business. Just, you know, you gotta pick and choose opportunities.

58:19

So long story short,

58:22

What what do you think is the what's your takeaway from this? So, like, what do you, okay. We made a bunch of bunch of predictions. We go back. We look. We see what we were right about. What we were wrong about? What's your

58:32

to the Chris Barling question that I love. What's the right lesson to learn out of this?

58:37

The right lesson to learn, there's a few. The number one is

58:41

58:42

we make money talking about this stuff. And that's great. You could say we make a great living doing that.

58:49

I feel like a puss for not acting on some of these things. I guess I acted on one, but, like, there's been five or ten or twenty things where you've told me, and I'm like, that's cool. I should go in on that.

59:01

Mainly, there's only been three things that I've gone in on, which is TRT, but, like, fuck. We talked about OpenAI.

59:06

Like, I we should have put our money. I think you have in a few cases, but I should have put my money where my my mouth was a little bit more. So that's one lesson, which is predictions aren't that easy or aren't that terribly hard. Having the courage in them is hard.

59:20

Mine is exact same thing, which is that the predictions that matter are the ones where you notice something

59:27

early before everybody notices it. But then you, like, that's, you know,

59:32

it's kinda cliche. Right? Ideas are kinda cheap and ex use everything. No. No. The idea is actually quite valuable. However,

59:38

it's potential energy. You gotta turn the potential energy to kinetic energy. How do you do that through, like, motion? Right? So it's, like,

59:44

chasing it down and actually doing something with it is

59:49

is where all the value gets created. And me and Ben have actually figured out

59:53

a little bit of a better way to do this. Both through, like, actually having, like, vehicles to invest in these things. But also, we just continually stop and ask ourselves. Like, I think in the last six months, there's probably been two or three times where we say What's the thing that we see right now that three four that, you know, three years from now, we're gonna be like, dude, we talked about that. That was in front of our face. Why why didn't we go and meet the guy? Why didn't we go and invest in the thing? Why didn't we start one, whatever it is. Right? And so

01:00:19

by asking that question regularly. Like, what's the thing that's actually hidden in plain sight right now for us?

01:00:27

I think I'm gonna, like, turn that dial from, like,

01:00:30

misting a bunch of these opportunities to taking advantage of them. We should do a whole episode on what those things are. Yeah. Yeah. Well, I I'll tell you the way I learned that, by the way, was I met this guy, Anamitra. And Anamitra came to my office, and he was the first product manager at Twitter. And I was like, tell me what it was like back then. He's like, well, there's like, I don't know, twelve people in the company.

01:00:50

I join, you know, fifteen people or something like that. I joined. And I was like, was it obvious at the time that, like, Twitter was gonna become Twitter? No. No. No. No. Not at all. Like,

01:00:58

Twitter was

01:00:59

kinda interesting, but looked pretty frivolous and useless. People were texting out, like, what they were eating There was no app

01:01:07

at the time. It was just you just texted this number, like, four four four four four or whatever. Like, whatever you're having for lunch, at Silicon Valley, people were, like, kinda having fun with it a little bit, but it didn't seem like a serious, like he's like, I had, like, job offers from Microsoft or whatever. Like, I had serious opportunities, and then here was this, like, Twitter thing, even the name sounded frivolous.

01:01:26

And he's like,

01:01:27

but I had learned one important lesson, which is that whenever you

01:01:31

see

01:01:32

like a phenomenon of behavior. Meaning, you see people acting in a way that seems strange, weird, or inexplicable or irrational.

01:01:40

The natural reaction

01:01:42

is to just write it off and be like, I don't know. Those are weirdos.

01:01:45

That that makes no sense,

01:01:47

idiots, and move on.

01:01:49

And he's like, what I've learned is now he's a VC. He's like, as a VC and as at the time, and he's like, thank god in my career. I I realized that, which was when you realize when you see that weird behavior that you don't understand,

01:02:00

the thing is not to the thing not to do is label it and write it off. It's to lean in and try to understand it. Is, like, so I saw that people were, like,

01:02:08

like, why would you text out what you're eating right now? Like, what do you why? And why do why do you like to see what other people are saying in that sense? Same way. Like,

01:02:16

that seems completely,

01:02:18

like, strange behavior,

01:02:19

but people are doing it. He's like, anytime you see strange behavior and people doing it, like, That's usually the the inter that's what a amazing opportunity actually looks like. And since he told me that, I then saw that many times over. Like, we got acquired by Twitch, I remember in college walking into my

01:02:37

the dorm room, the guy next to me who who lived next to me, and he was watching

01:02:41

a, like, a replay of someone playing a starcraft tournament.

01:02:44

And I was like, you are king Dork.

01:02:47

Not only is Starcraff on your screen right now. You are not even playing. You are watching

01:02:53

some guy

01:02:54

in Korea play this game. That is literally, like, the dorkiest dumbest thing. I didn't and I literally made fun of him for, like, a year. Later when we got acquired, and he's like, Oh, your head of esports at Twitch now. He was like,

01:03:07

he literally he was like, you, fuck.

01:03:10

He called me and he was like, you used to make fun of me for And I was like, dude, I agree. I was totally dumb and wrong. I should have done it. I I I don't even play games, but I watch people on YouTube playing.

01:03:21

Yeah. And I was like, I should have leaned in. Why would somebody do this behavior that seems completely irrational? Why would somebody watch someone else play video games on the other side of the earth? Through this replay that he had to download at the time. There was no Twitch at the time. It's like he had to download this thing off the server for eight hours and then watch it at night. And I was like,

01:03:38

weird. I don't wanna hear it. And then, of course, you know, so missing that five times has taught me, like,

01:03:45

lean into that. Like, and I just remembered the open eye example, by the way. Sam Altman, president of y c.

01:03:52

Right? He is he had the best job in Silicon Valley. President of YC was the best job of Silicon in Silicon Valley at the time. YC is probably the most, like, a value generative company at the time, or, like, organization. He's the president. He got picked over anybody else.

01:04:06

And he left to go join an AI nonprofit.

01:04:11

Yeah. Yeah. Like something sums up. These billionaires are putting a hundred million dollars into AI research company, this nonprofit. Why would they do that? And again, I was just like, weird. Sam, may have been doing a weird inexplicable thing. Instead, I should have been like, Hey. The smartest guy in Silicon Valley just left the most prestigious job in Silicon Valley to do this thing that sounds

01:04:31

sort of like strange to me, lean in. And, yeah, that's the lesson I would share. My takeaway of this whole thing. Let me wrap up with one quick thing. I forgot. I should have said this earlier, but we did this episode about this guy I think he was in India.

01:04:44

And

01:04:46

we called him in, and he, like, talked to us without his video on,

01:04:50

And I found him

01:04:52

because he had this website called Uber Pro. I think it was called Uber dot Pro.

01:04:58

And I've googled his name. I googled his name last night. I can't find him anywhere online. Oh, he's gone. I can't find him anywhere. And if anyone can find him, please do this. This would be amazing. I wanna see what he's up to now. He was twenty three years old or even younger.

01:05:12

And what I did was I gave him a thousand dollars, and he gave me ten thousand dollars in Uber credit. And for like years,

01:05:20

I took an Uber black everywhere because what he did was,

01:05:24

I think this is how it worked. What he did was he found all of these Indian kids that were, like, in his town,

01:05:30

And when you rode Uber for the very first time and you referred people, you got twenty five dollars in free credit. And somehow, he made it so he could convince all these kids to take a free Uber to get twenty five dollars in credit and to continually refer themselves

01:05:46

I also think he ranked really high on Google for Uber discount code or Uber promo code. And so he accumulated

01:05:55

A millions of dollars of Uber credit, and you could buy the Uber credit from him for ten cents or twenty cents on the dollar. And I found this website, and I was like, I'm doing this. And I bought, I think a thousand dollars worth of Uber credit. And I and then you have to change your iPhone from America to moldova. Your Uber account has to be a moldova.

01:06:14

And that was this loophole. And he was making a lot of money doing it. For an Indian, a guy in India, he was making thousands of dollars a month, which I think in the potty is like, yeah, I'm this is so much money. I think he was making thirty grand a month. And I will always I've always wondered, what is that kid up to? I wanted to know where where I've been him on. He was fascinating.

01:06:32

He was he was fascinating. That was a great arbitrage that the guy you know, how to architect it for himself. Very I don't know if it's illegal, but definitely against the rules, questionably unethical. But when you see things like that, they're going somewhere. And I've always wanted to know what happened to that guy. I wanna leave you with two

01:06:48

of the kind of you know what I talked about? Like, Why am I hearing about this three times? Don't just ignore this. Like, I'm training my brain to not ignore these signals now. I'll give you two of them. For people who made it this far in the episode, these are the jam this is the jam now. This is the part where you're like, holy shit. I can't believe they saved this for the end, which is basically

01:07:06

the two trends that I see right now that are

01:07:11

strangely big.

01:07:12

Go to go to character dot ai.

01:07:16

And pull up how much traffic you see that that website has.

01:07:20

Oh my god. I would have thought, like, ten thousand a month. And what's the real deal? Oh, my god. So

01:07:27

two hundred million.

01:07:29

Exactly.

01:07:30

Two hundred. A hundred a hundred million. What?

01:07:34

This,

01:07:35

like, you could go to the Wall Street Journal. It won't have two hundred million. You could go to New York Times. It's not gonna have two hundred million. This is No. No media site has that, and it has an average visitor of thirty three minutes.

01:07:45

It's beta dot character dot ai. Okay. So I've been on all direct talking about. I've been talking about AI and I've been talking about, like, only fans and this, like, kinda sometimes the crossover between AI and, like, this, like, AI only fans thing, and I'm looking at investment opportunities in the space.

01:08:00

There are so many companies

01:08:02

that are doing this, like,

01:08:04

chat with a AI

01:08:06

type of thing, replica, character AI, whatever.

01:08:09

And they never thought that would be a thing. They all have ludicrous traffic. We called it, by the way. We talked about replica, like, a year ago.

01:08:16

Girlfriends,

01:08:17

AI virtual girlfriends. Exactly. And that's a lot that's a lot of how people use this character AI thing. Like, they kinda

01:08:23

chat with,

01:08:24

Yeah. The chat, I think, void gray area a little bit.

01:08:28

I mean, it's a lot of, like, smart people like Einstein, but it but the The top person is Ariana Grande and Billy Eilish. And then, like, some k pop lady, like, there's probably a

01:08:39

a weird thing going on. People are being willing to chat with AI for a really long time. So easy to write off as weird, loser. But it's it's my friend watching Starcraft tournaments in the room next door. Right? Dork King Dork behavior.

01:08:52

I will not make that mistake again. This is def this is definitely something. I don't think that these companies necessarily are the winners.

01:08:59

But, like, you know, every every product, there's a kind of, like, the wave one of attempts, wave two of attempts, wave three. And then finally, there's, like, the last mover. Right? The the last mover who actually nails it and builds a full on product around this. And so there's something in this space that's, like, ranges from companionship

01:09:15

01:09:16

not a chat that, like, with AI, that's gonna be massive because the numbers are off the charts. The behavior of the strange thing is off the charts. Okay. That's one. Second one, which is less crazy,

01:09:27

01:09:28

there's a bunch of really smart people that are now have a new business strategy, and their business strategy is to buy wounded unicorns.

01:09:36

And so heard it once, heard it twice, heard it three times first heard this from Andrew Wilkinson. Andrew Wilkinson, he he called me back a couple of years ago. I was living in my old house in San Francisco, and he I remember him telling me, you know what I would do if I was you? Is I would find one of these, startups that's raise venture capital, but is not gonna become a billion dollar company, but they got to five million in revenue, ten million in revenue.

01:09:58

And you could buy these for cheap because they don't have a they can't raise their next round,

01:10:03

and there's no way out. And so there's not really, like, a a good exit market for that group, and those people don't wanna, like, fire a bunch of the engineers,

01:10:12

stop paying high prices for their San Francisco office space. And, like, become profitable. They could, in theory, but they're just not gonna eat shit in order to do that. They're just gonna shut it down, return investor money, sell the assets to whoever

01:10:24

they're gonna go start their next company or go get a job.

01:10:27

He told me that first. He had then done that with a company called Meteor. So Meteor was this developer framework I think he bought a company that was doing, like, five to seven million. It was doing, like, five million plus in revenue

01:10:38

for,

01:10:39

like, one x revenue or lag. I don't know. It was, like, some, like,

01:10:43

ignore the multiple of the exact Like, they I think they very I think they raised thirty million dollars or something. They had raised a bunch of money it had customers that had revenue, but it just wasn't gonna be the next big thing, which is venture capital is called become the next big thing or bust. And what he realized was If they bust, we can pick some of these assets up. So Andrew had said it.

01:11:03

Then,

01:11:04

you hear other people that are talking about this that are doing this, our friend, Xavier, and Seva, They're doing this. Right now, if you're driving to San Francisco, there is a billboard

01:11:13

with

01:11:14

with their company that says, like, whatever. Like,

01:11:18

There's never too late for a second chance or something. It looks like honestly, it looks like a divorce lawyer because it's KJ with her arms crossed, and it says, like,

01:11:27

You know, there's always, you know, there's always a second chance or something like that. And I don't know. They have a

01:11:33

billboard entering sentences, you know, like, when you come in on whatever the one zero one, it's like,

01:11:39

it's right there. And it's basically saying, you know, like, don't just shut down your company, sell it to us. So they're doing this. Jeremy Giffin is like, he became one that's like the best and he was like, yeah. I think one of the big opportunities right now is to do this. You hear this four or five times from smart people.

01:11:56

Like, you gotta be an idiot to not realize that there's probably something there. And it's, like, It's not you're hearing it from the news. Like, you gotta know where you're hearing it from. You're not hearing it from the news or, like, the hype cycle type of things. It's, like, your smart people mentioned these things in kinda passing or these opportunities, but it's not consensus yet. And you realize, like, oh, that's probably one of these, like, what I call, like, you know, value spots fat pitches. So, like, what are the big fat pitches that you could go swing at? You don't have to go swing at it. But, like, you should identify that at any given time, there's like a couple of fat pitch opportunities

01:12:28

that you could be going for it. That's one of them. I wanna learn more about it. I wanna how do you find I mean, I wanna know. I've got questions, like, how do you find them? Just run hands, bro. Don't don't even don't even about it. Just keep front of him. You already got your fat pitch.

01:12:41

Well,

01:12:42

By the way, love saying fat pitch, by the way. Just a fun fun phrase to say.

01:12:46

Yeah. I agree.

01:12:48

That is a good one. It's a good one. Where'd you still got from Ted Teddy Williams?

01:12:52

Warren Buffett.

01:12:54

Who stole it from Ted Williams?