00:00
This may not be the best acquisition ever,
00:03
but I'll be damned if a day isn't up there. Yeah. Right? Like, I think that he bought this don't know the I don't know the exact number, but he bought majority of only fans for,
00:11
I think,
00:13
single digit millions of dollars, maybe, low double digits, possibly low But let's even say it was ten million dollars.
00:19
This is now a more than ten billion dollar company.
00:31
I wanna start the episode with a survey.
00:34
Or the listener.
00:36
And we'll actually let John and, Ben chime in. So just, Ben, turn your camera on see your face. Alright. So we're gonna start with the survey. So on Monday morning, at seven thirty AM, I wake up from a text from Sean.
00:49
And here's what the text says. It goes,
00:52
hey.
00:53
You got good topics for tomorrow. I just texted Emmett from Twitch to do a pod, and he said he'll do it tomorrow. So I'm gonna drive to San Francisco tomorrow and record an interview with him.
01:04
And so when I want Jonathan and Ben turn your cameras on, what I want you to
01:10
do a thumbs up if you think that it's the first one. A thumbs down if you think it's the second one. Do you think that this text means,
01:18
okay, in lieu of Sam and Sean recording together, I'm gonna do one with Emmett
01:22
or do you think that this means, in addition to the re recording tomorrow, I'm also going to do one with Sam and Sean.
01:29
Thumbs up for the first white thumbs down for the second one.
01:33
Alright. Great. I just wanted to make sure I'm not crazy, and I wanted to Oh, Ben, the betrayal.
01:38
Oh, you too, Ben. You too. So I thought that that what it meant. And when I heard that, I was like, alright. So I have some free time between eleven and noon. I'm Lenny's a gentleman of the jury. Let me just say this. Would I say do you have good topics for the pod tomorrow if we weren't gonna do a pod with a good topics together?
01:56
I don't know. Seems like that might be something that, you know, that we're gonna do. Alright. Well, I just wanna see what the audience thinks.
02:04
So whatever.
02:06
I have a bunch of topics today. What do you have? I got bro, you think you've got a bunch of topics I got? Well, however many topics you have, add one. That's how many topics I got. Well, I see a big list. You you have like an interesting
02:17
you have a few interesting things. What are you you you wanna kick us off with something? Let's start with this. Yeah.
02:22
So,
02:24
we've talked a lot about one business on this podcast, probably more than many other podcasts has talked about this business. I would say we are the champions of of this company.
02:32
We are the ones
02:34
out here letting people know that this company is legit
02:37
That's company is big. This company is very interesting. Everybody's overlooking it. We've been saying it for years. Are you even a paying customer of this company? Not a paying customer because I'm a married man, but Well, you can be a married man who can't be a customer. But, like, I've never paid for it. I'm not a paying customer. Because free porn exists,
02:54
and I'm talking about only fans.
02:57
The
03:00
So only fans is annual numbers leaked.
03:03
And,
03:04
not leaked, actually.
03:06
What happened was actually kind of interesting. You know this, but maybe a lot of people who are listening don't,
03:11
which is that any company,
03:14
the, that is based in the UK,
03:17
has whether it's private or public, has to report at the end of the year of sort of a finance summary. And the more and the bigger your company is, the more data you have to include. Basically, like a like a public company, you have to report like. Like a public company. So
03:32
In the US, if it's public, you can go look up their information, maybe the quarterly quarterly earnings, or you can go find their s one. But if if it's a private company, you're just Shit out of luck. You're just guessing. But if you go to only fans dot com and you scroll down to the privacy policy, you click privacy policy, you will see that only fans is run by a company called Phoenix International Limited.
03:52
And what is Phoenix International Limited? It is a company based in the UK. So if you go to the there's a,
03:57
entity called company's house, and company's house is where,
04:01
all of the company information is housed.
04:04
And so if you go there, you can find, you can look look up Phoenix International Limited, and then you can look at filing history. And you could see that there are several reports. So reports about
04:14
this director replacing this director, but the one you wanna the one you care about is the one that basically says, here is,
04:22
the twenty twenty two financial summary, year end financial summary. And when you go to that, you're gonna see the following picture of a business. Only fans is a business that generated or or collected five point six billion in revenue in twenty twenty two.
04:37
It's take on that. It was twenty percent. So their their company took one point one billion. So for every four dollars a creator makes, they make one dollar.
04:45
On that one point one billion in net revenue,
04:48
five hundred and twenty five million of profit.
04:51
So this company's spitting off half a billion a year of profit.
04:54
Pay a little tax after tax profit is still four hundred million dollars. And then the beauty of it is if you scroll down to,
05:02
to the, I don't know, the balance sheet,
05:04
some somewhere down right at RAV for the P and L, it says dividends.
05:08
And it shows that the owner,
05:10
Leo, took three hundred and thirty eight million in dividends last year. Oh my god. And the year before that, he took, like, two hundred something million. This guy is taking out five hundred and fifty million dollars of dividends at the last two years off this business, which is just incredible because
05:25
let me remind let me remind you. This is a company that he bought.
05:28
In twenty eighteen. This is five years. What did he,
05:32
what did he he bought it? Do you know what he paid for?
05:35
Nonpublic information, but he bought seventy five percent of the business. At the time. For what I believe was low millions of dollars. Was he wealthy before that?
05:45
Yes. So Leo is a,
05:48
Kind of a gangster of the internet. And he
05:52
by the way, if you just go to his website, his website's awesome. So
05:55
There's really two things I love about the website. He's a listener, I think.
06:00
Well, that's one of the things I love about the website. If you go to his website, which is just his name, Leo
06:04
leo radvinsky dot com.
06:08
If you go to things I like, so he's got a things I like. And then the very first category
06:12
podcast,
06:13
The very first one of two podcasts is my first million. So he's a listener of the pot, which is, you know, just a cool thing, fun fun thing to see. But I love his website because
06:23
I love when people sort of put up their flag, and they're like, yo, this is what I'm all about. And it just they just make it really easy for you to just understand, here's who I am, here's what I do, here's what I'm into. And if I'm into this, if you're into the same sort of thing, we'll probably get along. So his His main thing says he's a software company, architect, angel investor, and open source software support. This guy gives
06:45
millions of dollars a year to open source projects that probably would have died had he not done that?
06:52
He is he's a huge supporter of of open source software and sort of like a,
06:57
he's, like, you know, like, a sort of,
06:59
freedom entrepreneur. Right? He he wants projects that are increasingly the overall amount of freedom in the universe. So whether it's, he'll fund
07:08
these open source social networks that are like,
07:11
like a mastodon type of type of social network that are are not owned and controlled by, like, Mark Zuckerberg or Elon Musk, like, one private company closed source owned by a a mega billionaire, He's funds projects that are alternatives to those. Unless at events, so If you go to his so you see, like, he has sections about me, projects, open source, things I like, If you click projects,
07:33
only fans isn't even number one of the listed projects. It's number two, number and and it just it just says, like, one paragraph and says what it is. But number one is some open source project. That's what he has listed. Yeah. Be before x. He's like, before x is like, tools for rapid prototyping and development, you know, Microsoft discontinued visual basics. And before x stepped in to try to make this happen, probably would have died. You know, they basically, like, I when I looked into this, it probably would have died. And then twenty nineteen, he decided
08:00
to, put a ton of money into it just so that this project could stay alive. And,
08:05
so then, like, under giving, he's like, yeah, I don't I don't need a bunch of my time, effort money to causes I care about.
08:11
Including open source initiatives and traditional charities. My goal one day is to sign the giving pledge. To sign the giving pledge, you need a billion dollar net worth.
08:19
I'm pretty sure he has, like, a multibillion dollar net worth now. I think he's achieved this goal because
08:24
in the five years and you can go look at the company filings, but, like, Twenty nineteen, twenty eighteen.
08:30
The company has, like, it pulls out, like, one point five million in dividends.
08:34
And so in like a three year period, he went from pulling out one point five million in dividends
08:39
to two hundred and fifty. And then three hundred and forty million dollars in dividends out of this company. So this accelerated extremely quickly.
08:47
And I think, like, you know, there's all these great tech acquisitions. There's, like,
08:51
you know, Google buying YouTube for a billion dollars, probably worth fifty billion now. Facebook buying Instagram for a billion dollars, probably worth a hundred billion now.
09:00
This may not be the best acquisition ever,
09:03
but I'll be damned if a day isn't up there. Yeah. Right? Like, I think that he bought this don't know the I don't know the exact number, but he bought majority of only fans for,
09:11
I think,
09:13
single digit millions of dollars, maybe, low double digits, possibly low double let's even say it was ten million dollars.
09:19
This is now a more than ten billion dollar company. So he turned
09:24
Let's just pretend it was ten million dollars into
09:27
essentially ten billion dollars of value. It personally, not a fund, not a company. This is him. This is one guy. Who owns the other twenty five percent? And is there a story of him buying this and, like, what he saw? Because, like, I would if if if If this was me five years ago, I would have been like, dude, this would never this will never work.
09:47
Right? I mean, everyone would have said that. So it was already kind of it was already working in a very small scale. So this guy, Guy Stokely,
09:54
was the founder.
09:55
And if you go look at Guy Stokely, he looks like an Instagram model.
10:00
He's like a,
10:01
like, every picture of him, he's flanked by seven women. And, the story is the that guy Stokely, his dad's in the finance world, he takes a small loan of, like, ten thousand pounds from his dad, starts only fans,
10:15
And,
10:16
they kinda co own the business or whatever. So it's, like, a father and son was, like, sort of the origin of this. It's a good bonding. Yeah. Yeah. Some guys like golf, some guys like fishing.
10:26
Some some fathers and sons start only fast. Like, right? Like, that's that's amazing.
10:31
And, I don't know why he sold or when he sold, but,
10:36
yeah.
10:37
Leo approaches them and they buy and he buys the business. He at the time, it was reported that he bought,
10:42
seventy five percent of the business. I don't know if later he bought the rest. I suspect he did because there's one of these filings that Guy Stokely has removed as a director in the company. So, maybe he just volunteered to step down. I don't know. It's, you know, at some point, you're just reading a bunch into these statements you can't say for sure exactly what happened. And this whole thing was very secretive. In fact, when I first found out about Leo owning only fans, at the time, Nobody knew who owned only fans. It was not cleared. There's nothing on the internet.
11:10
This was several years ago. And I was trying to figure it out. I couldn't figure it out. And then I get a message from somebody who's who's like, hey, I know the guy who owns only fans, and he loves the pot. I was like, whoa, that's cool. Like, I've I've been trying to find who owns this thing. I wanted to invest in this. And, anyways, that's how we kind of, like, I we ended up having a chat you know, well, I wanna meet this guy someday. He's got a really interesting story. So
11:34
now there's, like, a photo of him on the internet, and and there's he's a very private guy, but now a little more information has come out about him.
11:41
Very early on, I think when he was a teenager, like, fifteen, sixteen years old,
11:45
he got into the business of first, I think, like, domain. So he would basically buy
11:50
and sell, like, hundreds of domains. Like, there may be thousands of domains. In fact, there's like Some he got sued at some point. Some there's, like, a court filing of, like, here's a thousand domains that this guy still owns. And it's just, every variation
12:05
of, like, you know, sort of, like, websites that you can imagine, many of which were sort of in the adult category.
12:12
And then he creates my free cams.
12:14
And my free cams basically took over the Cam Girl market.
12:18
And,
12:19
I think that site still makes great value. You know, that's how we I think he got very, very rich, was off that site.
12:25
And he used that money then to invest and to parlay that into other other businesses. But he he owns a portfolio of these businesses, and now Phoenix International, which is only fans, has become a major, major one. This is amazing in a lot of different ways. One, it's amazing that company's house, which always a weird name. I hate saying that. It's companies, plural, company's house,
12:47
it's amazing that that exists, and it's one of my favorite places to do research.
12:52
It's amazing how fast this grew. Would you
12:55
Would you invest in this company, or do you not do you, like
12:59
Yeah. I tried to several times. See, you know, the problem was they didn't need any investment. They were making so much money.
13:04
So I was like,
13:06
hey.
13:08
I can add value. And I was like, I don't even, you know, am I really you're you're crushing it. What are you what am I gonna do here? Right? Like,
13:15
hey. I'm a fan. I think I'm a good hang. Can I invest? That's really ultimately what my pitch was. It's like, I'm a fan of what you're doing.
13:22
Unlike most people, I don't ju like, you know, at the time when I was saying this stuff, like, oh, I guess, had they
13:28
It's over time become more and more mainstream, over time become more and more accepted as a thing that's legitimate. At the time, it was seen as very,
13:37
Very sketchy. It was sort of the butt of the joke.
13:40
And,
13:42
yeah, so I definitely would have invested in this.
13:44
I wanted to they were doing so well that I don't think they ultimately needed needed any investment. Now the one thing they do need is liquidity.
13:52
Like, you know, he's taking massive dividends, which is great. But, like, You know, they could realize a several billion dollar liquidity event if they could go public or if they could sell. But there's no buyer
14:03
And it's hard to go public with a business like this. And so I think, you know, I don't know what they're gonna do with it, but, you know, it's not a bad plan b to just suck out hundreds of millions in dividends every year. It's fine. Yeah. I was gonna say is that what he wants? I don't know why you'd ever wanna go public with the I don't know if he wants that, but you always want the Right? Like, any business person who want the option, whether you take it or not is secondary. In fact, most of the things in my life I'm pushing for and people are like,
14:27
Do you want this? And I'm like, oh, I haven't even gotten there yet. All I want is the option. And if I have the option off, then I could think what what I definitely know is I don't not want the option.
14:37
Right? And I think that's just a better way to operate as a business person is to,
14:41
to make sure you have the options on the table for you. At four hundred million dollars a year in a dividend,
14:47
There's probably only
14:49
five or ten. I would imagine people getting
14:52
have who have in the war or at least in America, who have who have higher income,
14:56
Like, I remember Steve Schwartzman from Blackstone one year made a billion dollars. And then the other guy is, like, what's the guy's name? Is is it Griffith or Griffin? The, like, it's usually just, like, And Griffin. It's usually, like, the top five or ten hedge fund managers who make this. And they're actually if they're the best, they're it's fairly reliable.
15:14
But they're like the those are the guys who are buying the hundred million dollar apartments in New York, you know, like the Bill Ackman's, and there's probably only ten of them. Maybe twenty, but, like, that income, you'd be the highest in America in the top thirty or something like that. You know what I mean? So, like, I don't really I don't know, man. I would probably still own that. Well, this is cool. Well, I've I've
15:35
One thing that's cool about this guy, by the way, when I talk to him, like, you know, eighty ninety percent of our conversation was not about only fans at all. It was about these different open source projects he's interested. And he was just he's very, like, he's a technical guy. He's very curious, very interested. He was showing me, like, oh, by by the way, check this out. I'm gonna send you this link, you know, like, try this, try this site out. It's kinda, like, it's, like, this fringe niche site open source project, but, like, I think it's really cool for these reasons.
15:58
And,
15:59
I just love that. I love, you know, one of the things I love the most about tech is that it redistributed
16:04
wealth to a bunch of people who had different interests. So like,
16:08
when the wealthiest people were all from finance,
16:11
You just got this, like,
16:13
one homogenous pool of of rich people. It's like, here's a bunch of rich dudes that live in the same place. Like, al Like, the same stuff. White guys wearing suits. Alpha, New York,
16:23
you know, power suit,
16:25
watch wearing, art buying, greed is good type of guys. Yeah.
16:29
And then, like, crypto made a whole bunch of other people rich. Right? Because it was, like, you know, a different type of person got rich through that, and they had different interests. They're like, yo, I'm gonna spend money on this digital squiggle and this board ape, and I'm gonna donate to this other thing, and I'm gonna fund these types of projects, and these types of this type of world view I'm gonna fund. And, you know, tech companies were started by, you know, like Mark Zuckerberg and, you know, this guy didn't he wouldn't wanna start a hedge fund. He wanted to do something else. And because he does that, Now he could spend his money doing other things or Elon Musk. He's like, I'm gonna fund companies that will do space travel when no investor would fund this. I'll fund it myself.
17:03
And so I love when
17:05
wealth gets distributed to new
17:08
pockets of people who have different interests, different values because they're gonna bring some new, like, It's not the thing they created. It's actually all the stuff they do with their money that creates a hundred new new things. That's kind of interesting to me. I've, I've emailed back and forth with them just a few times. I've asked him to come on.
17:25
I think you have two. I don't know if that will ever happen. Yeah. He's like, I'm a pretty private person. I don't think he's saying I don't think I would make a a very good guess, but
17:33
You know?
17:34
Well, okay. Fine. We'll talk about your dividends then.
17:40
You either come on as a guest or we find you on company's house. That's the rules of this podcast. Dude, let me tell you about another person that is hard to find information on and is really fascinating, but really evil. Have you ever heard of the sackler family I saw that there's a documentary or a movie out on Netflix about them or a show, but I don't know anything about them. So I'm in the perfect spot. I'm interested in aware. But completely ignorant. So there's two
18:07
documentaries. One on who or, they're both actually fictional shows. They're both really good. One called, I think, dope sick called Pain Killer. One's on Hulu, one's on Netflix.
18:15
The story is about Purdue Pharma. So Purdue Pharma is basically,
18:20
I wanna tell you a little bit about that, and then I wanna tell you about the early even before that because that's more interesting to me at the at this point. But, basically, Purdue Pharma
18:28
started by three brothers. They it was Mortimer, Raymond, and Arthur Sacler.
18:33
They were in yeah. They are in the, Can you be named Mortimer and not be evil. Like, that's the
18:39
I mean, he's and he's one of the evil ones. And so, basically, these these three brothers, I'll talk about their background
18:46
in a second, but basically they were in the medical industry forever.
18:50
Since they they started as doctors, and then they worked at psych hospitals where they did lobotomies, and they're like, alright. Let's create let's start making these medicines and drugs. And so after fifty years of doing this, they eventually start or buy Purdue pharma. They buy it for not a lot of money. But they it evolves over forty years to where they create this drug called oxycontin.
19:10
Oxy cotton was basically,
19:13
it's an opioid,
19:14
and it wasn't popular at the time. It was kind of unknown. They had a drug previously that was similar. They kinda changed it, and they the big change they did was they called it a time released
19:23
technology, I guess. So,
19:25
and they threw a lot of just shady practices. It seems like they bribed the FDA. They hired lots of ex FDA people after they approved the drug, and they promised them all this stuff. They got the FDA to approve oxycontin,
19:38
and the big thing was that they called it time release, and they said that it was believed that and that that word believe is important. It's the first time the FDA ever said that. It's believed that less than one percent of people who takes oxycontin will ever get addicted. So what they do is they go and hire literally two thousand salespeople
19:54
who go to all of these hospitals, these doctors, these clinics, and they say, hey, look, we have this new drug. It's for moderate pain. It's you can use to, prescribe vicodin only if someone had surgery and had major pain or if they're dying from cancer. We have this new drug. Very few people get addicted to it and has a time release capsule, which means that it's really hard to get addicted to. So you can give this to people if they just have, like, a store back or if they have headaches. Like, it's not that big of a deal. And they train these sales people, and they're very aggressive about training. They hold contests where you can win a trip to Bermuda if you sell a certain amount of drugs. You could do all these types of things where they would give, like, watches. They would throw parties with hot girls. Like, they did all this stuff, but it was for medicine, particularly in opioid, which is incredibly controversial, in my opinion, very unethical.
20:39
And so they make oxycontin popular to the point where the company is privately owned. It owned by two families,
20:46
each mortimer and Raymond's family.
20:49
I believe Raymond's son, Richard, become Richard sackler, become CEO,
20:53
And they grow this company to be doing, like, thirty billion dollars a year in revenue. And they're also famous because in order to help their reputation, they donate billions, or they had hundreds of millions, maybe billions that it added up to to art museums. And so the Met in New York, they have a sackler wing, like the the Louvre in Paris -- Wow. -- they have a sackler winks. They these guys never went to Harvard, but there's, like, the Harvard School or the Harvard Museum that's for the sack There's the Columbia. There's the NYU. Like, they've donated so much of their money to arts, and it's basically what they call it, reputation laundering. They try to, like, get, like, into high society even though they're selling this drug. Turns out two years ago, I think,
21:34
the government finally cracked down on them, made them go bankrupt And I'm not sure where they are now, but they're very private. So that's the story of Purdue pharma. The the book Empire pains Wait. So sorry. The the end was the government cracks down on them and it goes bankrupt. So the government did what? Because isn't Oxy still like everywhere?
21:50
Well, so what's I I'm I don't know much about these types of drugs, but there's oxycotton. That's, like, the brand name. And then there's oxycodone. And I think that's the generic drug. And then there's hydrocodone. And then there's There's all these forms of opioids. I think you could still get oxycontin,
22:05
but basically at first, the government made them pay a ten million dollar settlement. And then people spent five years trying to track them down and, like, find, like, one thing that they did that broke the law because it was very weird because they weren't actually breaking the law. Or if they were, it was very hard to find which law they are breaking because the FDA kinda colluded and allowed them to get away with a lot of stuff. So, technically, they kinda weren't breaking the law. They got hold up in front of Congress, And what the government eventually does is they're like, oh, you lied to Congress because you said you didn't know it was addicting, but we found this email from four years ago where you did say you knew it was addicting. And so that's actually what they charged with, sort of like how al capone got charged with,
22:41
tax evasion, not killing people. It was sort of one of those things, and that led to a domino effect where they had to pay something like an eight billion dollar settlement. The sackler family had to give up control of the company, and they were no longer allowed to be involved in, this industry. That's kinda where we are today, where Purdue Pharma, it still exists, but not as it did before,
23:02
but we'll see if there's any actually long lasting change with all that. But it it's a it's a really fun story, like, in the sense of it's thrilling,
23:09
in that they were just horribly unethical. They did a lot of crazy shit. Does that make sense? Yeah. I mean, this basically killed hundreds of thousands of people. Right? Like, just through addiction. It killed hundreds of thousands. It killed hundred a thousand people directly, and that hundreds of thousands of people just taking that medicine were killed. But then what it led to is what we experienced in San Francisco and all these other places you take Oxy, and then you're like, I love this. I need more of it. Now I need something cheaper and something more accessible, heroin,
23:38
and then which leads to fentanyl. And so it creates this huge opioid crisis where Purdue was like, hey, we didn't do that. We just prescribed oxycontin. These guys are dying from heroin. When everyone's like, Man, it's such a clear, like, there's such a a clear transition here. Like, you guys are definitely responsible.
23:53
So that's why it's, like, a thrilling story. At Harvard, there's still this this building is still called the sackler, whatever the sackler Museum or whatever it's called,
24:02
still up, which is kinda crazy that they
24:05
haven't sort of canceled the the name off the building. So here's where things get interesting. And this is what I wanna talk about. So I mentioned there was three brothers, only two brothers owned Purdue.
24:15
So the eldest brother, his name was Arthur. He died in, I think, the late eighties or mid eighties. And, basically, he was the eldest brother, and he got them all into the industry. When he died, his estate sold his portion of Purdue to the other brothers,
24:32
And the other brothers are the ones who Purdue eventually created oxycontin. And so Arthur's heirs are like, look, we had nothing to do with this.
24:40
It's a same name, but, like, we had nothing to do with this. And Arthur was the one who liked to donate a lot of money to museums. So same last name, but their argument is that it's different people. But Arthur was incredibly shady, and I wanna tell you his background. This is where things get really interesting.
24:54
So check this out. So this guy, Arthur Sacler, he was the eldest brother, so he was a pay Patriarch. He kinda and he brought in his two brothers into the business. And he was originally a doctor,
25:03
but his first hit was as he was the doc he started an advertising age agency, a medical advertising agency.
25:11
And he studied copywriting. That was his thing. He learned about copy writing through a traditional agency where he would work at a traditional agency at nights and weekends in order to help pay the bills. And he was like, copywriting is awesome.
25:23
I gotta do this for volume or this other drug, this other drug. And so all these huge pharmaceutical companies at the time, this was in the fifties, sixties, and eventually seventies.
25:34
Like, what what's that big one? Roche, r o c h e. I believe that they were the inventors of Valium, and they start saying, hey, Arthur, your little agency.
25:44
We hear you have good ideas. What are your ideas? He's like, well, we have to hire a Salesforce.
25:48
Then we're gonna create these ads. We're not allowed to advertise towards consumers, but we can advertise towards doctors,
25:54
and they popularize
25:55
volume by making it like an everyday drug. Like, oh, if you're a little stressed
25:59
and, you know, just like you would take an ad bill, just -- Papa v. -- papa v. You'll be calm, and they have like housewives vacuuming and pearls, like, with a Valium,
26:09
like, logo. Or he also popularizes his trinkulizers. So he makes it popular. So he builds up the agency,
26:16
but in secrecy, he does two things that are interesting.
26:19
One, he finds his competition
26:22
is another medical pharmaceutical ad agency,
26:26
and he buys half of it. And so what they what he does is he eventually corners the market for pharmaceutical,
26:32
advertising, and he owns the other one secretly. And he'll say stuff like, look, you don't wanna work with us, fine. Go to our competitors. They sound like they're a good fit you and may collude together on how to, like, market together and, like, which techniques are working. The second thing that he does
26:48
is he creates this thing called the medical tribune, It's a bi monthly newsletter for doctors. So he's in the newsletter industry. He gets it's a free thing,
26:56
a free newsletter that is eventually read by three hundred, four hundred, five hundred thousand
27:00
and he what he does is no one knows at the time that he owns it. But he starts using his original
27:07
company, McArthur, for advertising,
27:09
buys ads in the medical tribune.
27:12
And through this, he it creates two huge companies. And that is how he creates his original fortune. And I found I went and, like, dug through,
27:21
newspapers dot That's one of my favorite sources. You can find old newspaper clippings. I found some of the numbers. So check this out. So,
27:27
Mick Mc Adams sorry. I called it McArthur. It's called Mc Adams. When he died, the company was doing a hundred and seventy million dollars a year in revenue, and that was in nineteen eighty five, I believe.
27:38
It had a hundred and seventy employees. And then his other company, medical tribune, it was it was not sold for a significant amount of money. It actually sold for around seventy million dollars to Axel Springer who also bought morning brew,
27:50
our friend Austin's company. So I've been giving him a hard time about this.
27:54
Austin Snackler,
27:56
Yeah. For sure. Austin Zachler. And so,
27:59
annual revenues for medical tribune range between fifty to eighty million dollars in the last few years of existence. This was in the late eighties and adjusted for today that's around a hundred and fifty to two hundred million dollars a year. He also, Arthur, while he was doing this, he was buying. He owned three New York City townhomes. He was making seven, sometimes eight figure dollar donations,
28:19
to our to museums, and he had an art collection valued at sixty million dollars. When he died, I think he was seventy five, that was in the late eighties. He was worth around a hundred and fifty million dollars, which today
28:30
is around four hundred million dollars.
28:33
Maybe five or six years after that, that's when Oxy was created.
28:36
But
28:37
besides the fact that these guys are, you know, do illegal, horrible, unethical things, What's crazy is this guy owned two companies that were doing close to each of them over a hundred million dollars a year, and it was medical advertising
28:48
and a medical newsletter for doctors, and he owned it was him and his wife owned the whole thing. So, like, super fascinating background story, about how this guy originally got well Wow. Prolific prolific family,
29:02
for sure. That's crazy. That's a crazy story. It's crazy. So a lot of the stuff, like, that the Purdue families or the Sacramento families about it's about oxycontin. And I thought that was interesting.
29:12
But what I thought was really interesting was just, like, I was like, well, just from an entrepreneur's perspective, how to started. And so I did all this research. I dug deep, and then I went into, like, a I I used this thing as, like, a historical money calculator. And so it helps you calculate how much money is worth today. I then looked at real estate prices from the seventies and eighties in New York City, and I found out how much he was paying for homes. And I found and I basically, like, reverse engineered, like, the income
29:34
from this medical newsletter because I was just curious how it works.
29:38
I think, by the way,
29:40
that still works today.
29:42
And
29:43
there was another company. I don't know if you remember this, but there was a company that used to give out free
29:48
TVs. To doctors, TV, and these TVs had, like, skeletons on them. And you could, like,
29:54
you could, like, move the skeleton around
29:56
in order to, like, show, like, alright, your colon is actually right here, and we'll zoom in on that. But on the TV was ads
30:03
for drugs.
30:05
And this company eventually got in trouble interestingly enough for fraud. It turns out they were lying about a lot of stuff. But this pharmaceutical industry is so interesting to me because it's something that we're supposed to trust. Turns out,
30:17
it's a lot of it's bullshit, and it's just as shady as someone would say that this my free cams website is, or even worse. And it's really fascinating on how this whole industry works, but
30:28
medical newsletters super fascinating, a legit company axle springer, which is a five billion dollar German newspaper company bought it. And so I actually think these still work today if you go on TV still running, by the way? Or no? No. They shut it down. They, I believe they shut it down. And, like, everything involving sacklers, like, people don't wanna have anything to do with But if you, if you're on do you ever watch cables TV? Yeah. Sometimes. Dude, it's only car commercials and drug commercials. That's like all it is. It's like Cialis
30:55
and,
30:55
like, it's So, anyway, this pharmaceutical advertising industry, it's, I would never enter it, but it's really fascinating how it's done. And it's incredibly lucrative. It created this fortune, and I think it could still create more. Well, I put this out there before, which was that,
31:09
we get asked a bunch about, hey, I'm doing a newsletter. Can you help? Can you invest? Can you advise, whatever? And we've basically, I think both of us say no to pretty much all of them.
31:17
The one that I think is interesting still or two the two areas that I am interested is
31:22
doing an amazing job of this in real estate and who's doing an amazing job of this for the newsletter for doctors. Those are the two that I really care about. And I'm like, I really wanna find whoever's doing a great job of that and, you know, invest or advisor partner with them to, like, help make that bigger because I think those spaces
31:38
are
31:39
amazing spaces if you have the right person going, like, doing it the right way. There's a lot of nuance to it, but,
31:45
yeah, I still think this idea would just work again. And they and they sell for huge multiples. So aging media did this for
31:51
nursing homes. So somewhat senior living. Yeah. Yeah. Somewhat related. I I don't remember the multiple, but I heard rumors. It was, like, fifteen times profit, which is really great.
32:01
And so these businesses are still super lucrative. And I think what Arthur did
32:06
Whether you think that's good or bad, the way that he did it, I think is bad inherently. I don't think it's bad, but the way that he did it is, I think it's still incredibly lucrative
32:17
Our software is the worst. Have you heard of HubSpot?
32:20
See, most CRMs are a cobbled together mess, but HubSpot is easy to adopt and actually looks gorgeous. I think I love our new CRM. Our software is the best. Hubspot,
32:30
grow better.
32:32
Let me tell you another story about a a smart weirdo. Alright? So here's here's the smart weirdo. Here's the smart weirdo. Smart weirdos slash maybe bad people. This guy, I don't think is considered bad, but,
32:45
he's my Billy of the
32:54
A million dollars isn't cool. You know what's cool?
32:56
A billion dollars.
32:58
Okay. So we've had we have some, actually, multiple contenders. This is a ability of the week,
33:04
run off, actually.
33:06
Maybe this is actually a campaign.
33:08
But this guy is is,
33:10
doing something interesting. So his name's Steve Davis.
33:12
You probably don't know who that is just because it's a fairly generic name. But,
33:17
and if you Google his name, it's a it's a professional snooker player. What is that pool?
33:22
Yes. Like, or pull. Some kind of, like, pull if you if you had, like, you know, the wrong color balls or something.
33:28
So
33:29
this guy is Elon Musk
33:32
long trusted,
33:34
like, right hand man. So let me tell you about this guy. He, joined SpaceX back in two thousand and three.
33:40
So very early on.
33:43
Crazy background. He's got a twin master's degree in particle physics and aerospace engineering. Right? So, you know, guy's got a dome on him. And he
33:52
but I think what he was doing I think he was doing something, like, a little bit unrelated, but he was one of the first employees that ended up getting hired by spacing. I I for some reason, I feel like I remember
34:01
he wasn't, like, working in the industry. He was doing something else and then he got it. And,
34:05
stories about this guy are kinda legendary. So when when Elon bought Twitter,
34:09
people were like, who's gonna, who who's he gonna make CEO? And a lot of people were like, it's gonna be Steve Davis. Before he put the the lady from NBC in charge, which was sort of a weird pick. It seemed like it was gonna be Steve Davis. Why? Because Steve Davis was living and sleeping in the Twitter office
34:24
with his wife and their newborn child. And we had just, like, three weeks prior. What a brown nose there?
34:31
Intense.
34:32
So this guy,
34:34
if you go read the stories about him, it's like it's like a folklore.
34:38
So, one person said he has been working six hours a day every single day, seven days a week for years and years.
34:45
Another person said, He's insane.
34:48
He gets more work done than eleven people working together, just himself.
34:53
What? One time,
34:54
one time Elon Musk
34:56
they were doing something with the production of, of a part in, in,
35:01
of one of the parts of the of the rocket, I guess. And this was a hundred and twenty thousand dollar parked.
35:06
And Elon's like, we need to get this down to five thousand dollars. And nobody would everyone's like, what are you talking about? Like, course. I wish I wish it was free too, but, like, that's just not how things work. Yeah. He's like,
35:17
five thousand dollars.
35:19
And he's just left the room. Right? And Steve Davis takes that as a personal challenge. He's just working for months and months to try to figure out how can we do this for five k instead of a hundred twenty k.
35:27
He ends up getting it done for three three three thousand nine hundred dollars. He figures out a way to do it. He emails Elon so excited. Elon, we did it. After months, we figured out how to lower price of this part down to only only less than four thousand dollars. You said five. We got it down to less than four. Elon just replies.
35:43
Okay. Period.
35:46
It doesn't matter. Steve Davis is undeterred from this, and he he just keeps going. He's become,
35:51
now he's the CEO of boring company. So Elon's, like, a, you know, third company or whatever that he that he created after,
35:58
all that where he's got space. And and that company's legit. Right? Boring company. They actually are making stuff, or is it just a t shirt company?
36:05
No. They are doing things, but there's a lot of criticisms, like,
36:10
cool. Like, how,
36:12
you know, how
36:13
How's that tunnel going? Yeah. Right? Like, where's well, what's going on? You you dug this tunnel, but, like, it's only compatible with Tesla's, and they have to put, like, roller blades on before they go through. It's like, I don't know. Seems kinda shitty. Right? Dude, I want my city to look like Swiss cheese. Just holes all over the place. Like, what's what's going on? You're just selling flamethrowers.
36:31
And so
36:33
You know, on one hand, they have improved the
36:36
speed of of boring of, actually digging the tunnels.
36:40
But the reason I found this guy interesting said not only is he, like,
36:44
Elon's right hand man that you haven't heard of that, you know, I find that interesting.
36:48
Not only is he probably
36:50
worth
36:51
maybe a billion dollars at this point, like, based on the, you know, SpaceX stock has appreciated, like, crazy since two thousand and three. But,
36:58
this guy's totally weird. So he just is he's got a great sense of humor that he takes to business. Okay. So,
37:05
he, what,
37:07
basically, Elon sends him. Elon trusts him. Right? He's like, hey. We need somebody on the ground in
37:12
You know, he's at, like, this, like, city in Texas and, like, at one point, he sent them to DC for,
37:17
lot. Like, you know, they needed to be near
37:20
DC because a lot of their contracts are government contracts. So it extends Steve out to DC from California.
37:25
And
37:27
Steve's living there. He's doing his job, but he's like, god, you know what I miss?
37:30
I miss just having great frozen yogurt. He's like, they don't have that DC. He's like, he's like, all I got is this crap I missed the California first and yogurt. You know what?
37:39
So as a side job from his very important job at SpaceX,
37:43
he opens up a Froteo shop. Called mister Yogato. And he that just opens it up. He goes and he works there after work for fun.
37:52
What? And so he goes and he works there and he starts to make it fun for himself. He creates just a bunch of ridiculous policies. So if you go to mister Yogato,
38:01
If you can stump him with a Seinfeld question, you're Froo's free. If you come in dressed as,
38:09
Bjorn Borg or whatever, the, like, tennis player, You can or not. I don't use the touch screen. It's a there's a musician or something. You get twenty five percent off. If you let him stamp mister Yogato on your forehead, ten percent off. And so he created this long list of rules, essentially, on the secret menu.
38:28
What he could do. And then when he had to leave, he had to move away,
38:31
you know, SpaceX needed him in some other place. He's like, oh, shit. I'm not gonna be able to go work in my yoga shop after work.
38:37
Okay.
38:39
Hey. Come whoever comes to mister Yogato today, one of you is gonna get the shop for a dollar. He just gave the shop to some guy for a dollar at the end. I was like, here's the keys. The only rules.
38:50
I wanna keep, you know, being able to come here and eat half off. And,
38:55
you know, and also you gotta keep some of the the the the the rules alive. Like, if you can recite a speech from braveheart in a Scottish accent, twenty percent off. And so He's so he does this yogurt shop. He also Do the At one point The the headline, if you Google make mister Ogado is it's a from an article in the Washington, it says Twitter's next CEO might be the mister Yogato dude.
39:18
Yeah.
39:20
He goes But, like, the rules are amazing. It just you should go look at the rules of this. Rule number eight, anyone wearing a kickball uniform and has played hard, ever by dirt on their knees will automatically receive ten percent off their yogurt.
39:33
Anybody who can reenact the forty seven second Michael Jackson thriller dance, twenty percent off. If you perform a shorter choreographed dance, you can get ten percent off.
39:41
This is actually genius, by the way. Order a yoga for thirty consecutive days, and we'll name a flavor after you. Mean, this guy's awesome. Yeah. So he's having a good time. So then he opens up a bar
39:51
called Thomas Foolery.
39:53
Short name Tom Foolery.
39:55
And same things. Instead, you know, every bar has a happy hour, he created the angry hour. Where if you shout your order of the drink to the bartender angrily,
40:04
get a discount on your drink.
40:06
You know, they serve, like, cookies and ice cream at this thing. And he's like, this is a place where we're gonna take you back to being a kid. But with alcohol.
40:14
Oh my god. And I was like, dude, I love this guy. This guy is,
40:19
hilarious and weird in all the best ways And I just went down this rabbit hole because he's he's this guy kinda fascinates me. There's nothing about this guy really on the internet. Nobody does interviews with him.
40:29
People discovered this mystery Yogato thing, but there's not much out there about him. How'd you find the part thing? A few times.
40:34
That's, like, you know, part you know, just digging in, like, what are some of the other craziest things that this guy does? When they announced,
40:41
the boring company. It was a press conference with Elon
40:44
and some guy. The some guy is Steve Davis sitting next to him during the the talk. And what they did was to make their point. This is I I I kinda love this marketing
40:53
to make their point that, like, why did you create the boring company? And he was like, well,
40:58
in, like, whatever. A hundred years, we haven't gotten any faster at drilling. Like, we're still the same speed. We were, like, fifty, seventy five years ago at digging these tunnels. Nobody's done anything innovative and to do when they and they did the press conference, it's them talking,
41:13
but around them is a circular track.
41:16
And on that track, they put us little like a a snail or a slug or something. And it was just walking around the track super slowly to represent how slow this industry
41:26
is and how slow other people are drilling. And at the end of the two hour seminar, it was still only halfway around the thing. Oh my god. And they're like, you know, that's the industry today, and we're gonna change it. I love these little nuggets. These are all sort of, like, marketing gimmicks that make a point in the sort of simplest, most,
41:43
memeable viral way possible.
41:45
You know, I gotta give Elon credit and, this guy Steve Steve credit for how they do that. It where where did you work before? How do you get a job with Elon?
41:53
Well, just early on, you know, if your twin master's degree in particle physics and aerospace engineering, there's not that many places to go work. You work at NASA or you work, you know, Boeing, or you go work here. Right? So he he got a job there early on and just, like,
42:06
started grinding like crazy. And that's why, like, even now just sort of grinds like crazy, sleeping in the office with the with his newborn child that was just, like, his wife just just in your birth. I have a rule. We have a rule in our house in the in the par house. Where I will only sleep under another man's roof
42:22
for one night. And if it's my father if it's my father in law's house, he gets two nights. I don't like sleeping in another man's home. It's the most emasculated thing on earth. I can't imagine
42:35
moving my wife in newborn baby
42:38
into the Twitter office. Can you It's my boss's house. Yeah. My boss's house.
42:43
Oh, like, Eli's like, Hey. How's our wife doing? Like, you're like a billionaire too. You're not like an intern.
42:51
Yeah. You're you're, like, I I I don't even, like, I don't stay at another man's house, and I don't even, like, staying at my father's law law's house. Let alone staying at the Twitter HQ. Can you imagine with a newborn, with a newborn, or or a baby?
43:03
I can't imagine that. That's not for me, dog. What what's your phrase? Coronrose and face tattoos? Yeah. It's not for me. But I'm glad freaks like you exist. So I'm glad it exists. Sleeping at the office with my wife and baby, you got you can have that. Happy you exist, but but that ain't for me. Is there any part of you that is envious of this guy? Cause I don't find any amount of envy other than I appreciate his sense of humor.
43:27
Oh, yeah. I think this guy is great. I think, do I wanna be him? No. That's what I mean. Do I think that this guy's
43:34
probably,
43:35
you know, this guy's interesting and seems like he,
43:39
thinks differently, and I think I could learn or be inspired by it. For sure. For sure. For example, I went deep. So one so one of the things he did while he was working at SpaceX, and they moved him to DC.
43:51
In addition to the yogurt shop, He went to George Mason and got like a PhD.
43:56
And his thesis, if I found his thesis paper and I read it.
44:00
Which was very hard. I don't wanna go into to a detail on it. How did you find this? I when I'm googling him, I you can barely find anything. It's the same, like, four photos.
44:07
Just a lot of grit determination.
44:10
You're the Steve Davis. You're the Steve Davis of researching deep, Steve Davis.
44:15
Exactly.
44:17
I applied to searching researching other great men more so than than being one myself. So slept on your couch for literally hours.
44:23
Define this.
44:24
It was literally
44:26
I ignored my divorce. Yeah. So
44:31
I'm just gonna read you two things. So first, the paper, the reason I really liked it is it's about the debasement of the US currency. I think he wrote this in,
44:39
what year was this?
44:41
It's basically, like, very, it's very early. It's, like, kind of, like, early, early Bitcoin days. So let me just search Steve Davis.
44:48
Basement.
44:51
So, yeah, twenty ten. And his papers called the trend towards the debasement of the American currency.
44:58
And he talks -- What's debase it mean? Does that mean is that the bottom? Does that mean that -- devaluing?
45:02
Devaluing. So so, you know, he he talks about the history of, like, you know, basically,
45:07
you know, I don't have my notes in front of me now, but, like,
45:10
one of the things he talks about is,
45:13
you know, Did you take notes on this basis just for your itself.
45:18
Yeah.
45:19
So
45:20
I was, like, you know, he's, like, one dollar or whatever you know, one or so one ounce of gold was worth this many dollars four. And now that same ounce of gold requires whatever, like, you know, a hundred x more dollars. Like, basically, like, we used to be pegged to gold We got off the gold standard and look at how look at how much the dollars devalued relative to gold in that time. And he's basically, like, there's a trend
45:43
towards
45:44
the debasement
45:45
of,
45:47
of currency. And he talks about, like, people think this is like a you know, over time slow
45:53
slow thing, but actually, like,
45:55
ninety five percent of the debasement has just happened in the last, like, forty, fifty years or something like that. Like, it has accelerated quickly, and this is not just like,
46:05
yeah, this is not just like, you know, a a a slow thing.
46:08
Alright. Here we go. So ninety eight point three percent has occurred
46:12
from nineteen seventeen ninety two to the present time, but even if you shorten that, like, still ninety percent of it happened in a very short window of time. And he talks about why he talks about how. He talks about, like, what that why that's such a big problem.
46:25
And this is basically, like, a, a cryptocurrency,
46:27
like,
46:28
like, he's not talking about Bitcoin in it, but this is, like, This is crypto is a solution to this problem. Right? Like Bitcoin softness.
46:37
Could not be debased exactly,
46:38
which is like the meme, but it's It's also, like,
46:43
the truth.
46:45
It's, like, these things are cliche because they're an element of truth, and then those are that's why they stick around. In his acknowledgements in this paper, so he says, oh, I wanna I wanna thank this professor or this professor.
46:55
I wanna thank this person.
46:57
And at the end, he's like, I wanna thank my mom and dad. He's like, finally, thanks to the unknown chef that makes great brownies at small enterprise Hall cafeteria.
47:06
Hopefully, they will one day become a topping at mister Yogato, or its successor, Little Yohai.
47:11
I'm like Dude, it's been plotting.
47:13
This guy is just hilarious, man. This guy is just so funny to me. And, yeah, there's, like, a hundred page paper if you wanna go read. The most impressive part is that you read this guy's thesis paper, and you got as far as to the acknowledgements
47:26
at the end. No. No. Acknowledgements are the beginning, my, my friend. That's, like, the,
47:30
this, the thank you at the beginning of a book. So I didn't read the whole thing. It's a hundred sixty two page thesis. I read, like, forty pages maybe.
47:38
He's a step by step.
47:40
Step by step where the debasement started and how it happened. And I'm like, oh, wow. This is fascinating. I can never knew any of this. Is that what we have to do to become a date your PhD is to right a hundred and forty page, like, original work on something. That's amazing. I didn't think I didn't know that thesis is worth that long. Not only do we not have a PhD?
47:58
We honestly don't even know what the hell a PhD is or what it takes to get one.
48:03
I tell people I had my PhD. I thought I meant poor, hardworking, and driven.
48:07
Like, that was my joke. I I A play of hating degree. Yeah. I didn't realize that it's you have to write a hundred plus page like, report on this. That's amazing. Good. I'm not that hungry and driven.
48:21
Yeah.
48:22
Definitely not. That sounds really challenging.
48:25
By the way, one of the great get to know you questions in the business world that's sort of dorky, but actually is a good one, which is If you had to give an impromptu forty five minute talk on a subject, what would you give it on? Like, for you, it might be like copywriting, or newsletters. Right? Like, is something like that? The history of denim.
48:47
What?
48:48
I'm not joking. I could do it.
48:51
You've already talked about denim? I got you.
48:56
What would yours be?
49:00
There is no answer that is better than that answer. I I don't wanna continue the podcast. It was so good.
49:06
You see, the things about
49:08
the things about looms is in the pre portion of the joy that
49:13
Shutter looms pre nineteen forty four were particularly special, but, you know, I could talk all about it. And then post war with Japan was rebuilding Hiroshima. They needed a just a ton of machinery, and that's where the shutter looms of America went to Japan. I mean, I could do it. Let's
49:28
That's the same. Alright. Your your turn. What's your topic? Where do we go from here?
49:32
You wanna do post pilot? I like post pilot. Alright. Let's talk about private. I invested in post pilot. Did you? Yeah. Me too.
49:37
I didn't, you know, I don't like as you call it, talk in your own book too much. I don't like talking about stuff that I'm involved in, but since we're both involved about it and we're upfront, we could talk about it. Well, explain what it is first. Yeah. So let's talk about it. So
49:50
Our connection to Postpilot is with the owner. His name is Drew, but he actually bought the company. And the reason he bought the company was because he owned,
49:59
He used to buy software companies. So he bought design and public dot com. He bought he bought karma loop dot com, and then he owned this thing called auto anything, which was an auto parts store. And the thing about
50:10
his whole, like, playbook is that he would buy these,
50:13
ecom companies, and he could be like, well, your email list stinks so we can, like, improve that. We could do this. We could do that. And one of the things that he used to do with these companies that worked really well was he would email or mail them, like snail mail them, like flyers and direct mail pamphlets on the company. However, it was really hard to do. It was like a painstaking process. And so he bought this company called Postpilot. He bought it. I think he bought it for sixty thousand dollars. And what it does is if you're ecom brand, you just sign up to Postpilot, and they plug in, I think, to Shopify,
50:43
to woocommerce, to, like, a lot of the popular platforms, and they have a done for you service, meaning they'll help you design a pamphlet that you could send to not only your customers, but I think some of your email subscribers and people who haven't already bought from you, and they can send direct mail and a click of a button. And so what he has found like, this whole thesis is like, look,
51:04
If I have an email list in some of these companies that I bought, their email list was a hundred thousand people, but ninety thousand people wouldn't even open the email. Ten thousand would, but how do I get the other ninety thousand people to interact with me? Well, let's just send them mail. And so they created a process that you can use someone's address that they've already supply to you, or I believe what they do is you can,
51:24
you can use someone's email and phone number and help use other data sources to find out roughly where you live, and they'll send mail to you or that area or people who match your it's like a Lookalike Audience, and they send you mail, and they could track if you eventually bought something through their mail. So it's a very ROI positive business us,
51:41
ROI positive marketing channel. And I think he bought this company in two thousand eighteen. He bought it for sixty grand. It's making well over sixty grand a day now. I think that the last the the public information that they said was they crossed ten million a year in revenue,
51:56
like, eighteen months ago, I think, and it's growing like a weed. And he sends amazing investor updates,
52:01
where, like, there'll be, like, a theme. So for example, him and his co part or him and his partner sent an update where it was him and his partner dressed like stepbrothers.
52:11
And so, like, he does these really funny updates, but the business is growing like a weed. It's growing crazy. And they're,
52:18
It's really fascinating. Is that what what I'm not an ecomm guy. Is that what you what how you use it? So so we use it. And, like, you know, if you advertise on Facebook, Are you advertising on Google?
52:29
And, you know, the the key metric for any e commerce brand is your your return on ad spend, when it comes to marketing. So you spend a hundred dollars on ads. What's your return? Are you gonna get a hundred back? Are you gonna get two hundred dollars back? You can get fifty dollars back. Fifty dollars would be a point five percent on ad spend. Two hundred dollars would be a two point o, return on ad spend. If you can be, like, getting a two point o return on ad spend at scale, you're printing money. You're putting in a hundred dollars. You're getting two hundred dollars out every single day. And,
52:56
that's, you know, obviously, if you could scale that up, that's that's extremely extremely lucrative.
53:01
If you use post pilot, you can get, like, a ten x return on a head spent. It's not the most scalable, but it is pretty ridiculous. The type of return you get. He said a lot of people are getting five to ten x.
53:14
He said most retention campaigns come in between five and ten five and ten.
53:19
So, like, he kills it. That I I don't use it. Yeah. These are these are, like, retention. Right? So you're, you know, you're trying to get people to, if they come back or you're trying to get a warm lead who hasn't bought from you, but they gave you their their info to try to convert. So it's, you know, obviously different for a completely new customer versus returning customer whatever. But
53:36
the blended,
53:37
roas for these is really, really good. So it's very effective. Right? You send a postcard. It's got a bunch of it's got photos. It's got photos on it. It's got an offer on it. And,
53:45
cool thing what they did was they basically took this they they weren't the first to do, you know, how do you send mail campaigns? We'll send it for you. What they did was their treating it like it's Klaviyo. So most of you outside of e commerce don't even know about Klaviyo, except for the fact that it just filed to go public. So now a bunch of people are paying attention to this, like, ten billion dollar company. That raised very little money.
54:04
Email marketing for,
54:07
for e commerce. Actually, it didn't raise very little. It raised four hundred million. It only burns -- Sorry. -- net fifteen million dollars, which is shows how capital efficient it is. That's what I mean. Yeah. Sorry.
54:17
So every e com brand basically uses Clavio at this point.
54:20
It is, like, the the the the the dominant player in the space. There's some others like Sand Lane or whatever, but they basically said, we're gonna automate this. So, like, We will take all your call your customer data from Shopify,
54:30
and we'll be like cool.
54:32
When somebody first joins, we'll put make a welcome flow. So automatically, it'll drip out, like, one hour after they after they sign up for emails, they'll get this. Three days later, they'll get this. At thirty days later, they'll get this. Clavio. Clavio. Yeah. Yeah.
54:45
And now what post pilot did was they took the same thing. They were like, cool. You wanna send a one off blast. You can just go in our editor and do that. You wanna create automated flows that are just gonna triggered based on customer behavior, you could do that too. So they basically did for physical mail. The same thing that Clavio did for digital mail, which is very, very smart.
55:02
Yeah, anyways, I think I think they're they're doing really well. And we'll see kind of how how big I think the only question of this one is just how big does it get? It's a high floor
55:11
unknown ceiling. So it's like,
55:14
this business is definitely gonna work. Now the question is is it a yeah. Even when we first invested, it was like, clear this is gonna work. And it was a low it was a low valuation compared to everything. It was not low. It was a reasonable valuation compared to everything else. I think I have about twenty five grand in the company. Yeah. I did something similar. It wasn't, it wasn't, like, you know, massive, massive bet, but,
55:36
know, the question is is this gonna be a fifty million dollar business, a hundred million dollar business, a five hundred million dollar business, or a billion dollar business? I have no idea on that one, like, we'll see. But,
55:45
but it's definitely, like, it was like a clear this isn't gonna be a zero type of investment. So I did this one personally not out of the fund because I was like, you know, you don't know the profile of this one. I thought so I have twenty five thousand of my own money into the company, I think. I, in my head, when I was looking at it, I was like, I think
56:01
the
56:02
the the likely worst case scenario
56:05
is that this will sell for seventy or eighty million dollars. I was like, I think I could five x four x my money. I think in a unlikely,
56:13
but high,
56:14
outcome scenario, I was, like, many, many, many hundreds of millions of dollars this could sell for.
56:19
And I could, for sure, one hundred percent, ten x this, maybe more.
56:23
That that that was kind of my thinking with that investment. And twenty five thousand of my own money is I I usually do small small checks. That that's a smaller checks. That's a that's a good one for me. Right on.
56:34
I have some other topics, but I think we should save them. One thing I wanna do is
56:38
I wanna start doing
56:40
episodes that are business ideas only. So sometimes but but, basically, if you think an episode of my first meal, you you kinda don't know what you're gonna get. There's a box. You might get a billy of the week story about crazy people who have done crazy things.
56:53
You might get a business breakdown like we did with only fans. Just like, here's a business, here's the numbers, here's how it's doing,
57:00
maybe it's a business like post pilot, like a business you never heard of that's doing really well.
57:05
We kind of expose you to the to sort of,
57:07
things that are under the under the radar are not not on your radar. And then sometimes we do ideas and opportunities, things that we think people could do
57:14
that could be that could work. And,
57:19
Monday, I say I'm proposing this to you. Monday, I think we should do, when we record Monday, we should do business ideas only. I think, I think we're good Monday, and I have a good one. Which are people's favorites. The the business idea is an opportunity. There's definitely people's favorites.
57:33
So we'll do that.
57:34
But, you know, if we're gonna do that, people gotta do something for us. Right? Like, I don't know about you, but if I kiss, I like to get kiss back. If I hug, I like to get a hug back. And if I provide value, I like to get value. Yes means yes.
57:50
And
57:51
all we need from you to give value back, put your wallet away. You know, we don't it doesn't take money. It's not free, though. It ain't free. It ain't free. It sure is LA ain't free. But but your money's no good here. What we do need is if you take that little finger of yours. Open up the podcast app, click subscribe.
58:08
Go to my first mail and click subscribe. The next thing you're gonna do Where do they do that? Where do they do that? They do it on Spotify?
58:13
Spotify,
58:15
Apple Podcasts, whatever whatever is your comfortable place. I'm not trying to get you to go somewhere. You're not comfortable. Right? Go over here. I'm comfortable, but just make sure you click and subscribe.
58:23
Now go to YouTube.
58:25
You may YouTube. Go open YouTube.
58:28
Type in my first million, click subscribe, hit the little bell so you get alerts. We need both of those things from you. We just need it. And I don't ask for much, but I ask for this.
58:38
Don't let me down. And if you want, leave a comment. You could leave a comment, we read all of them. And we even the funniest ones, we send to each other, particularly if they make fun of us.
58:47
Yeah. The most insulting ones definitely get the most attention.
58:50
And,
58:52
we can't resist. We're not one of those we're not those people who are like, I don't read the comments. I don't read the haters. Read all of them. We read you. Yeah. Think about you.
59:00
And I recognize usernames.
59:02
You're living in our head. Yes.
59:04
I've googled some of these people. I do a re re reverse Google image search and find out their LinkedIn.
59:12
And here, I'll actually leave,
59:14
I'll leave, like, a hit. So
59:16
for next Monday, you you can see on here which company I'm talking about if you scroll down. So I was gonna start this with a business that used to exist that was way ahead of its time that I think should exist today. Now is the time. Now is the time if you could possibly pull this off. Do you agree with me? Do you see what company I'm talking about? I know what you're talking about. I agree with you. I can't wait to talk about that one, and I have one that is,
59:42
similar
59:43
to
59:45
one of the best businesses in Andrew Wilkinson's portfolio.
59:49
And I think you could create a new version of that that would work really well. That's the teaser. Alright. Manic Monday, we'll call it. I don't know. We'd always go from ideas to ideas or where we just look at the comments and just stress out over, like, blemishes we have on our face. But it's manic Monday.
01:00:04
So
01:00:05
you you don't have to pay money for this show, but it ain't for free. And and you know how you know how to pay for it. So alright. That's the
00:00 01:00:33