MFM #166: Why a Sudoku Company Sold for $640m, "Opendoor for X" & Franchising Tech Companies

Sam Parr

The very bottom it says this: "This domain is not for sale. Please do not inquire about purchasing it." All emails from anonymous or unknown companies asking me for a price will be ignored. Sorry, last updated July 2007, right?

Shaan Puri

So I emailed this guy and I was like, "Hey, saw your website. I think it's awesome that you're not trying to sell this, but I'm curious... why aren't you trying to sell this?" And he... refuses to monetize it, refuses to sell it. I think it's hilarious! What is this? Let's...

Sam Parr

Talk about business ideas. First of all, let me give you an update. Did you see someone in the Facebook group launched a pickleball newsletter? We told them to a few months ago because we...

Shaan Puri

told them to

Sam Parr

And now, it's their full-time job. They travel the country, getting their products in stores and things like that. It started as a pickleball newsletter.

Shaan Puri

right

Sam Parr

And then they partnered with the pro tour of pickleball, which I didn't know was a thing. They started selling their own stuff out of a van— their own pickleball equipment. Now, they're in retail stores.

Shaan Puri

good stuff what's their name give give them a shout out

Sam Parr

Thomas Shields, good job Thomas! Thomas looks like a young kid. He looks like a younger, better-looking version of me. Let's see... I can't... Yeah, he looks young. He looks really young. So congratulations, Thomas Shields!

Shaan Puri

That's great! I think the CEO or the founder of pickleball either listens to the pod or he messaged once saying, "Yeah, I'm down to come on." So we can have him on if you ever want to. We could do an episode about alternative sports basically, and do some research and have him on as well. Great!

Sam Parr

and speaking of alternative sports do you wanna talk about chess

Shaan Puri

yeah so I have a follow-up there I don't know if you have one or or or just what I put there

Sam Parr

Go ahead, what were you going to say? So we talked about the background. We talked about Chess.com in the last episode. I tweeted about it because I was even more interested.

Shaan Puri

in that tweet dude that tweet had tons of engagement

Sam Parr

It was good, and the summary of this is that we actually underestimated it. Chess.com gets around 200 million monthly unique visitors. They have 60 million registered users. Their traffic has grown significantly. If I had to guess, they do at least $100 million in recurring subscription revenue. Potentially, it's worth $1 billion. Super fascinating company. Go ahead, what were you going to tell me about?

Shaan Puri

Trying to hype it, and we actually were underhyping it. Even though we were trying to hype it, by the way, the guy who started it is like an ex-Stanford guy. The guy who owns it, you know, has two, I think, Stanford guys, which is cool. They didn't go the same track probably as 95% of their classmates, and they're going to outperform 99% of them just by doing something really simple that the world wanted. So I started thinking about this because we talked about it. You brought it up. It's a cool topic, a really cool business. It really fits what we call the "New Zealand type of business" that Andrew Wilkinson kind of coined that phrase. It's this independent thing; it has like a cult following. It's profitable, it's simple, and nobody competes with it. It's like New Zealand—nobody's going to war with Chess.com. You know, the biggest competitor I think is called Lichess or something like that. It's basically like an open-source, free, you know, kind of alternative, and it's also doing extremely well. Those are like the two, but it seems like people kind of prefer Chess.com. So I started thinking, okay, what's the next Chess.com? What are the others? Is there a whole slew of these guys? Because I think that's where we didn't talk about last time that we should have, and so I wanted to double-click in a little bit. So I started...

Sam Parr

And that was... that's a really, really hard question. I've been thinking about it too. I only came up with like Domino's. I looked into solitaire websites; they... a lot of them crush. But yeah, that's a hard question to ask.

Shaan Puri

So, I spent 10 to 15 minutes on it, but that was enough to tell me something very interesting. The first game that came to mind was chess. Here are the characteristics you need: you need a game played by tens of millions, if not hundreds of millions, of people that is not owned by a brand. Chess works. Checkers also works, but the problem with checkers is that it's so simple that it doesn't have as much depth. Therefore, there's not as much money made and passion around the sport. Sudoku was the second one that came to mind. I went to sudoku.com, and it's just like chess.com. You go to sudoku.com, and there's already a Sudoku board waiting for you with a clock going. It's like, "Oh, play here it is!" You don't need to download anything or sign up; you just play Sudoku. I love that. Then, you scroll down a little bit, and you see an advertisement for a mobile Sudoku app. I clicked that, thinking, "I bet this app has amazing distribution." The app crushes it! There's a company called Easybrain behind it. The Sudoku app they have has 50 million downloads on just Google Play. Forget about iPhone; that's just Android. It's probably 100 million total lifetime downloads. The website itself gets about 10 to 20 million visitors a month, so they're getting basically free traffic to their mobile apps, where they're able to monetize. Easybrain is a mobile app developer that makes these apps. They've had over 750 million downloads in the lifetime of these little simple number game apps, starting with Sudoku, then a remix of Sudoku, and then another number game if you liked that one. They just cross-promote them within each other. I bet this company is crushing it. They're based in Europe, and it's like...

Sam Parr

I have information on them. I just found some interesting stuff when I Googled them and went to their website. There was something amazing about them that immediately stuck out. Just this quick Google search... I could be wrong, but it is based in Cyprus. It turns out these guys are actually from Belarus; they're from that area but are based in Cyprus. So, I just Googled it real quick. Do you know that they were acquired 3 months ago?

Shaan Puri

no I did not know this so that's the okay that's the other piece

Sam Parr

I have their revenues I have their profit and I have the all their user numbers and I have

Shaan Puri

All right, I can guess, and I'm gonna be told I'm wrong, but I... I like to guess. By the way, here's a little tip: **always guess before you hear any number**. That's how you get good at knowing numbers because you guess and then when you're wrong, your brain remembers that shit and you start to hone that gut instinct. Okay, so here's my guess. I'm gonna guess... well...

Sam Parr

how much were they what was what's their revenue

Shaan Puri

I'm gonna guess that their revenue was **$400,000,000** a year. Okay, what's their profit? **$90,000,000** a year.

Sam Parr

pretty good alright how much were they acquired for

Shaan Puri

I'm gonna guess that they were acquired for **$52,800,000**.

Sam Parr

Okay, and how many daily active users do they have across their 15 games?

Shaan Puri

I'm gonna say they have 25,000,000 dau

Sam Parr

Okay, so you didn't do horrible. Easy Brain was acquired last February. They were acquired for $640,000,000 in stock and up to $125,000,000 of additional consideration if they hit it. So $640 [million].

Shaan Puri

yeah what is that that isn't that exactly 850

Sam Parr

No, what's 6... What's $6.40 + $1.00? It's $7.40. + $0.25 is $7.65. Great job! You guessed $8.50. Great job, you're almost there! Their revenue... in 2020, revenues were $210,000,000.

Shaan Puri

okay so I

Sam Parr

You were off there by half. You guessed $400,000,000, but their profit was $70,000,000. You guessed 90 [million], right? Pretty good. They've had 750 [million] installs over the course of their lifetime, across all their games. They have 15 live games with 12,000,000 daily active users. You guessed 25,000,000.

Shaan Puri

okay

Sam Parr

not bad

Shaan Puri

Not bad. What a company! So, okay, that was the first one I thought of. And by the way, I think there are other versions of that. Like, you know, I don't know... go look at something like **SudokuOnline.com**. I don't know what's that like, you know? All the things people are going to Google search - if you can get the top-level domain for those, that's really interesting. So then I started looking at some others. **Poker.com**... so I went to Poker.com, and Poker.com is like... kinda like this crappy... Just describe what you're looking at when you go to it.

Sam Parr

Let me look at this. But you can't... this isn't actual poker, right? You're not betting.

Shaan Puri

It's not even a... you can't play there. It's just like reviews. Here's a... it's like an affiliate site. So it's like, "Oh, here's a place to play poker, here's where you can go," because they get big kickbacks for basically sending a player to PokerStars or wherever if they deposit and so on.

Sam Parr

this is horrible

Shaan Puri

What is it? A website? Crappy, kind of like an affiliate reviews site. Dude, you could do so much more with this website. Like, if somebody was like, "Dude, I have a mobile poker app that's good," I would pay like ungodly amounts of money for poker.com. I think that that's a great idea. Also, if you do their traffic search, see what they get.

Sam Parr

it's nothing

Shaan Puri

So they should be getting a lot more traffic having Poker.com. Okay, so then there's some other ones: CrosswordPuzzle.com, Crossword.com. Go to those... like, they don't even... Crossword.com or something doesn't even render. It's like there's like 5 asterisks on the screen. Yeah, like what's going on here? Because crossword is the other game that's like Sudoku. It's like chess that people play religiously, and they love. We talked about how much the New York Times makes off their mini crossword game. I can't believe you've...

Sam Parr

The number was **$90,000,000** in subscription revenue from crossword puzzles for The New York Times.

Shaan Puri

So, I am surprised at crossword puzzles. Crosswordpuzzles.com, Crossword.com... I can't believe that these sites are not being leveraged. I was very surprised to see this, and yeah, that was my follow-up from this.

Sam Parr

So, you go to crosswordpuzzle.com. It says, "Please email suggestions to [email protected]."

Shaan Puri

Right, so I emailed the guy. You see, the website is basically like a white page with a bunch of text, and it's basically...

Sam Parr

just linking to

Shaan Puri

some things

Sam Parr

The very bottom it says this: "This domain is not for sale. Please do not inquire about purchasing it." All emails from anonymous or unknown companies asking me for a price will be ignored. Sorry. Last updated July 2007, right?

Abreu Andrade

so

Shaan Puri

I emailed this guy and I was like, "Hey, I saw your website. I think it's awesome that you're not trying to sell this, but I'm curious: why aren't you trying to sell it? What do you want this to be? Why do you believe it should be done this way?" You know, I'm just super curious about your thought process. So, we'll see if he replies. There's another website that's like this, and Parej, see if you could find the name of it. I don't recall it, but Sam, you might know this. There is a website that's like a misspelling of google.com or gmail.com. I think it might be gmail.com or something like that. It's the same thing; it's an all-white web page that says, "Yeah, Frank and Susan, we were married in 1977," and like blah blah blah. "No, we're not going to put ads on the site. No, we did not own this before Gmail came out." It's like they basically just have this web page that gets a counter of how much traffic they get, and they just show that they're getting like hundreds of thousands of hits a day. The guy refuses to monetize it and refuses to sell it. I think it's hilarious. What is this?

Sam Parr

what brady did you find it

Shaan Puri

Brady, try to find it. I'll find it after the pod. Otherwise, I have this in my things to tweet about, you know? Full.

Sam Parr

That's actually such a funny idea! Oh, so like if we just looked at the most visited websites and find out what the typos are for each one and go and look at what those are. So like, if you go to goggle.com (G-O-G-L-E), Google owns it, so it redirects to Google.

Shaan Puri

Of the time, the company owns like their plurals and their misspells. But sometimes they don't, and some of those are hilarious.

Sam Parr

Oh my gosh, I just... I was looking at Bing. I changed it to "Bang." Don't go there.

Shaan Puri

found something else

Sam Parr

Yeah, don't go there. What else is there that's like a... what's a... like a YouTube? [spelled wrong]

Shaan Puri

Like, you can do Facebook, but you could do, I don't know, like you lose the "a" or something like that. I don't know. See what that is.

Sam Parr

God, that's so interesting. That's actually an interesting thing. Facebook owns "Facebook" with one "o". Pretty interesting. That's actually an interesting thing. I'm gonna research that after this, I'm gonna...

Shaan Puri

I don't know if you know the guy who owns Bitcoin.com. His name is Roger Ver, or something like that. He's kind of hated in the Bitcoin community by about 80% of the people because he tried to create his own fork of Bitcoin. So, they forked Bitcoin, and I think it's Bitcoin Cash or Bitcoin Satoshi's Vision (BSV). I forgot which one he's associated with; I think it's Bitcoin Cash. But basically, he created... you know, they forked Bitcoin, and they have their own version. This guy owns Bitcoin.com, and he's like a billionaire from Bitcoin. He refuses to give up Bitcoin.com, but it points to the other version of it—the not-so-popular version of Bitcoin. You know, it's like the fifth Jonas brother who's not in the band or whatever. It's basically like that.

Abreu Andrade

oh the whole time

Shaan Puri

Kind of a waste. But nobody can sue them because there's no company behind Bitcoin, and nobody owns the trademark.

Sam Parr

That's a pain in the ass. I hate that. Yeah, I'm looking at it now. Let's talk about... well, which one do you want to go through? We have a bunch on the agenda here. Okay, does this interest you? Well, first of all, I want to tell you about a company I just invested in, and I want you to criticize it or tell me if it's awesome. Oh, you actually read it! Okay, so we just did a podcast a second ago, and Sean talked about angel investing. I've been doing a little bit of angel investing now, and my whole thing is I'm doing this thing called a syndicate. I almost did a rolling fund like you, but I didn't really want a full-time job. So I was like, "I'll just do this." It's deal by deal, or not a full-time job, but whatever it is for you.

Shaan Puri

right

Sam Parr

And my premise is this, and you confirmed it a little bit by your reaction. What I'm trying to do is find interesting deals that other angel investors, who I think are smarter than me, or other firms, who are smarter than me, are also investing in. But I try to find them where they're explaining the company really poorly. I'm spending time with the founder, listening to them, and then I'm rewriting a memo about the company. I'm sending it to people to invest in, and it's kind of working. So, I sent you one deck, and it was really bad. It was confusing. Then I just rewrote it, and you're like, "Oh, I want to invest in this company, maybe." Yeah, and it worked.

Shaan Puri

I was kind of gushing. I was like, "Dude, did they write this memo? Who wrote this memo?" I was like, "This is the best investment memo I've ever read!" And you were like, "Dude, shut up. I just wrote this in 20 minutes." I was like, "No, no, no, trust me. I read a lot of these things." The memo was so good that I had to separate the writing, which was really entertaining, persuasive, and likable, from the business. I was like, "Dude, I don't want to just convince myself this is a good business; I want it to be a good business." You know, I love pictures where the founder can just barely explain what the hell they're doing, but then I'm like, "Oh, that makes total sense!" I'm like, "Yes, that's like you! You get it. You're not like a salesman, so I'm not going to invest in this hand-wavy stuff." It's like, "No, it's real, and it's working." You're explaining it in kind of this nonchalant way, but it's actually super legit. You just don't get really excited and animated, and you don't have great words to describe it yet. Actually, I can help you with that. It sounds like you're thinking about the same thing. I'm actually just thinking I'm going to simplify my thing, which is just helping them with their landing page and their communication. Almost every company invests in their landing page, and it kind of sucks. The landing page is really hard to make good, but they need a lot of help. It's something that not every other investor is offering to do for them, and they actually are not that good at doing it. So, anyways, I got off topic, but your memo was really great. I actually want to publish it in some way. I don't know what you could do, but I feel like that should be public. I want to...

Shaan Puri

To that

Abreu Andrade

and be

Shaan Puri

like this is great writing here's why

Sam Parr

You can go to, if you like, AngelList Hampton VC and you can invest if you wanted to. Or you could even just say you're going to invest and then look at it. Once it's done, I can publish it or I'll publish it. But this company, it's Lobby.com, Lobbyed.com. It's so funny because he actually did something really good. Basically, and this kind of sounds simple and negative, but it's a cool company. I've invested in it. It's basically software that helps doctors schedule appointments or helps patients schedule appointments with doctors in a good way. It's kind of like an archaic space, but he was like, "We're making the lobby digital." And I think that's so much better than saying, "We are creating software that's just a CRM for a doctor's office." They're like, "No, we're making the lobby room digital, and we're going to save people so much time." So basically, the software allows you to schedule an appointment online, and they'll alert you if the doctor is running late. When you get in the parking lot, you can tell them, so you just wait in your car, and they'll tell you when to come in. The interesting thing about it is the guy has already started and sold a company in this space. At worst, it's going to be okay; at best, it might be big. Anyway, I just thought it was so interesting how it was digitizing the lobby or the waiting room of healthcare. I wanted to bring that up because I think it's so cool how they repositioned that to make something that isn't that cool sound kind of neat.

Shaan Puri

Right, yeah. You know, that's a skill that's like a superpower in and of itself. I don't have a ton of thoughts on the business itself, so I don't have too much to add there. But I agree with you - basically, the most interesting part of talking about Lobby was your memo. It was so damn good, and I think we should show it to people so that they could see: **How do you make a business seem really juicy to be a part of? To invest in?** Because I think you did a good job of that.

Sam Parr

Well, that's what we're going to do. I'm doing it with Joe, and you and I will probably do a bunch together. I hope we're all investing—yours and you mine. The whole thing is, I'm not trying to sell people. I'm not trying to convince people to do it. You either want to do it or you don't. I'm not going to try and convince you because that's kind of unethical. I just want to paint the business in the most positive light, or at least what I believe to be accurate. It is cool, and I want to make sure you know it's cool. I think that this cult copywriting thing for angel investing might end up being a hit.

Shaan Puri

Yeah, I think it'll be easy for you to get people into your round because people like you and the memos are good. So I think those will be good. I have a company I wanted to tell you about that's a cool company that I think you're gonna have a good opinion on. So, have you seen what Keith Rabois is doing as his new startup? No? So, you know who he is?

Sam Parr

yeah so he's the guy who

Shaan Puri

He was like ex-PayPal. Then he was the COO of Square. He's kind of a known investor at Founders Fund. Started over, known as an asshole.

Sam Parr

like people think that he's a

Shaan Puri

Total asshole on Twitter. Super hilarious to follow because he's just an absolute jerk to people. You know, his number one tweet is just like, "Wrong." He won't tell you why; he won't argue back. He just calls you an idiot. Then, if you try to argue, he's like, "This is why I was more successful at the age of 27 than you are at 40." He just rips people like that. Who does that? Nobody does that. I think that's just really crazy and entertaining to me. But anyway, he's doing... he did Opendoor. What Opendoor is now is a publicly listed company because it did a SPAC. Opendoor is a multibillion-dollar company. Basically, selling your house is a time-consuming and stressful process. What if, like, the day you want to sell, you could just sell your house right away? They give you a price, you say yes or no, and that's what Opendoor did. They basically would just buy your house, and then they had a lot of data to know how much to buy your house for. They were the brokers, so they could keep the broker fee for themselves when buying and selling. Then, they would sell it within like 90 days, hopefully. They do this in a whole bunch of markets, like Arizona and stuff like that. They've done very well, you know, kind of like on paper. Now, Zillow does the same thing to try to compete with them. They kind of changed the way that the business model of these big real estate companies worked, where now the money to be made is basically in auto-buying your house and then reselling it for you, using a bunch of technology to do that. Anyways, his new company he's starting with Jake Jack Abraham is called OpenStore. So you have OpenStore, and now you have OpenStore. I know they haven't released a bunch of details, but I think I know what it is. It is Opendoor for buying businesses. It's the same idea for buying. I think it's going to be specialized in online businesses, but maybe not. Basically, you just say, "Here's my business," and then they say, "Here's your offer. We'll buy it off you." I don't know if this is going to be specialized like e-commerce roll-ups, like Thrasio. I don't know if it's going to be online and offline like Tom...

Sam Parr

where did you learn about this and what what can I go is there a website yet

Shaan Puri

They announced it, so I heard about it a few weeks ago—like 6 weeks ago, maybe. I was like, "Oh, that's super interesting."

Sam Parr

how did you hear about this

Shaan Puri

So, somebody told me about it because their friend interviewed at the company. That's like the only way you can know about it. When you interview, they kind of tell you the premise of the company. That guy was like, "Oh dude, you know Keith's employee is doing a new thing. It's basically Opendoor for buying businesses." I was like, "Oh, that's sick! That's a great idea." Buying and selling your business is even more time-consuming, stressful, and uncertain than buying a home. You're uncertain about what price you're going to get and what price it even should be. The marketplaces to do that online, like BuyBiz or whatever that website is, like .com.

Sam Parr

buy biz sell

Shaan Puri

They're so old school, you know, in how they do that. I think there's room for improvement there, so I found that to be really interesting.

Sam Parr

Let me bring this up real quick. It's so crazy how often internet marketers, who are often accused of being sleazy—and many of them are—are actually ahead of the game. For example, email marketing and email newsletters are all the rage right now. Scammy guys... like, I don't think this guy's actually scammy, but David DeAngelo used to sell dating books in the 1990s by having these long emails. I just stole and copied from him. The other thing is paid memberships. Paid memberships have been a thing for decades now. Guys like Greg—your friend, our friend Greg—are doing a paid community thing, and Greg's a cool guy. So it's like, it's cool to do it. And there are so many more examples. Another one is buying and selling businesses online. This has been a thing that internet marketers have engaged in for years. For example, Flippa, where you could buy affiliate websites, has been around for years. Empire Flippers is another one.

Shaan Puri

empire builders yeah

Sam Parr

empire builders and if you go empire flippers or empire builders I think those are actually 2 2

Shaan Puri

different things yeah

Sam Parr

But if you go to those websites, you're gonna... a lot of people are gonna be immediately turned off. You're gonna think, "What the fuck is this?" And fucking startup guys like us, we just come in - I guess that's what we are - we just come in and we take the stuff that these guys have been doing for years and we just say...

Shaan Puri

put some lipstick on it yeah

Sam Parr

1. Make it a flat, beautiful color. It's so funny because, like, cool, this sounds neat, but this isn't unique.

Shaan Puri

Right, yeah. I think, you know, there are really no unique ideas. There are remixes of ideas, old ideas that you make new, and new platforms. But I think it's cool, and I think it could be big. It's one I'm going to keep my eye on. Then I saw another business like this, so I started to put together a little bit of a pattern here. I said, "Oh, what is Opendoor for X?" What other parts of life and the world could use instant liquidity? Because that's what this is. It's basically taking something that was kind of illiquid, like your house, and it takes a lot of time to get liquid when you actually sell the thing. It takes a lot of effort; you gotta move out, you gotta stage it, you gotta repaint it, you gotta get a broker, you gotta list it, you gotta do tours. No instant liquidity. We buy your house today. Don't do any of that stuff. Same thing with buying your business. What else needs that? Then I saw another one, and this business is called... I'm going to grab the name, but it's basically doing this for used electronics. It's called Backflip. It just got funded, and Backflip is basically saying, "We'll instantly buy any of your used electronics." And because there's... and that's not...

Sam Parr

a new thing either and and I think it's awesome

Shaan Puri

And so it's not that it's new. It's basically that there is a big swing being taken by people who are going to try to do this at scale using the modern kind of internet marketing models to do it. So, like, you know, "We Buy Gold" or whatever else does billboards...

Sam Parr

gift cards

Shaan Puri

You know, like gift cards? Yeah, exactly. There's actually a gift card startup that crushes that. They basically took the old model and just did it new.

Sam Parr

what's it called rayze

Shaan Puri

I think it's

Sam Parr

What I mean is, yeah, I'm on their website right now. I'm looking at Rayze.com. Holy shit! I can look at the traffic and just tell you these guys...

Shaan Puri

Are printing money? Yeah, Raise is gonna be like a $1 billion+ win and nobody even hears about this company. Nobody talks about this company, but you know, super simple business of like... gift card. The gift card business, resale of gift cards essentially. So anyway, I'm interested in this OpenDoor for X, which is basically instant liquidity for things. That's interesting.

Sam Parr

Alright, let's play off that. So, houses. Okay, there's EquityZen, which I think is badass. So, EquityZen will let...

Shaan Puri

You know, EquityZen kind of looks more like Flippa than it does like Opendoor. Meaning, it's kind of hard to get in; it's kind of obtuse. You have to sign up to see things, and not everything is there. It's like a 10-step process to make an investment. EquityZen is not like Robinhood on my phone where I could just do my thing. As for secondary shares, yeah, it's like a bad name. I don't know, it's just bad all around. Forge Global is the other one, and it's also bad. I feel like somebody should do this better. Carta is trying to do this better right now, which is like secondary shares of private companies.

Sam Parr

Yeah, I'm not a fan of Carta, but I could see them doing well. However, I'm not a fan of Carta, so I don't know if I'd want them to be the best at this.

Shaan Puri

Angelus is also trying to do it. You know, there's a bunch of people trying to do this. Second, they're trying to do what Opendoor did, but it's a little bit different. They're still trying to create a marketplace. What Opendoor did was different; it wasn't just another housing marketplace. It was, "I will buy the thing off you right now because I know what I can sell it for, and I'm comfortable with this 5% spread that I will keep." So, you give up 5% of your upside, but you get the certainty of it being done now. I'm comfortable with that 5% spread. So, somebody would need to do this for secondary shares, where they just say, "You want to sell your company stock? Done." Then, I will figure out how to flip this thing on the other side with my own spread.

Sam Parr

So there's a few people that have done this with furniture, and furniture is really hard because furniture doesn't ship well. But there is... if you... I don't know if you know, I mean, I like buying used furniture because you can get like $10,000 couches for like $3. And oftentimes they're really nice. Used furniture is not really a thing on the internet, or at least it's not hugely popular, but I think there is still an interesting way you could do this with used furniture.

Shaan Puri

right

Sam Parr

so I think trading cards

Shaan Puri

Is 1... So, I know a lot of people that have sports cards. They collected them as kids, and now they're in their attic somewhere, in a box. They kind of heard, "Oh, cards are worth something," but they don't know what they have. They don't know what it's worth. They haven't had them graded; they didn't send them into PSA and pay the money to get them graded. So, I think if somebody basically did the shoebox model, where you say, "Put it all in a shoebox and mail it to us, and we'll pay you for it," that would be great. We'll do all the work of figuring out what it's worth, and then we'll pay you, you know, 70 cents on the dollar for what it's worth. Like today, you're getting nothing for it. And if you don't like our offer, we'll send it back. I think that if somebody did that, they could just hoover up all the long tail of trading cards that are out there that people are not doing anything with but want to monetize.

Sam Parr

That's interesting. Okay, so we've... furniture is not that good. Trading cards are pretty interesting because it's a lot easier. Cars... a lot of people do cars. Carvana does cars, and I think that is so sick. They're a multi-billion dollar public company.

Shaan Puri

they they use where they'll instantly buy your car off you

Sam Parr

Yeah, like they'll buy it in a matter of minutes. If you told me this years ago, I'd be like, "No way, that can't be done." But they made $5,600,000,000 last year in sales, so it works.

Shaan Puri

okay so it's working open door for cars is working yeah

Sam Parr

Yeah, totally works. What else is interesting? What's a huge thing? Like, what are some of the bigger assets that you possibly have in your life that you want to... Wow, Carvana's market cap is $45,000,000,000. Holy shit! Yeah, it's working. Yeah, what else is there?

Shaan Puri

I don't know, there's gonna be some obscure stuff like... oh, like life insurance policy payouts or something. You know, like something that I'm like, "Oh, I don't even know that space, but that makes sense." It takes... you know, it's something that you get. Or like Social Security - I know my parents are getting to the age where they can collect Social Security. Would they take a lump sum of all their Social Security now, you know, at 70 cents or 72 cents on the dollar, and then this company just collects the payments over time? Like, probably... I don't know. There's a lot of people who would make that trade.

Sam Parr

Dude, did you know this? There's a company—I have to go and look at what it is—but you guys could probably Google it. I think some banks do it, like Goldman Sachs will do it. If you have a winning lottery ticket, they'll buy it off you. They'll give you the money up front, and it's structured in such a way that they're still able to make their profit. They'll buy lottery tickets from you, like we're talking $10,000,000 lottery tickets or seven-figure tickets. It's kind of interesting that people buy winning lottery tickets off of others. That's actually kind of an interesting one. I would need to do some research. How much money do you think is won in the lottery per year?

Shaan Puri

Oh dude, I have no idea. I mean, I feel like the weekly lottery, the Powerball, every week is like... you know, between $50 and $200 million. It's like that's on a weekly basis. Now, it doesn't get won every week; that's how it accrues and that's how it gets bigger. But like, you know, I don't know. Do you have the number in front of you? I feel like it's going to...

Sam Parr

Be less... I don't know. No, I can't find it. There are 1,600 lotteries created each year, so there are at least 1,600 unique winners. No, I don't have the numbers, but lottery tickets might actually be kind of interesting because you said the life insurance... I'm like, "What do you wait to get paid for that?" You would take a discounted upfront payment. Lotteries are actually kind of interesting, and I do know that some banks actually do that [offer upfront payments for lottery winnings].

Shaan Puri

right you

Sam Parr

know who else does that it's whitey bulger you remember whitey bulger

Shaan Puri

I've never even heard that those words in my life

Sam Parr

do do you know the movie the departed yes you know jack nicklaus' character

Shaan Puri

okay yes

Sam Parr

It's modeled after Whitey Bulger. He was a gangster in Boston, either an Italian or an Irish mafia guy, or a mobster. He ended up going to jail, and recently they found him; he got beaten to death in jail. So it was like a crazy ending to his story. He was America's most wanted man for like 20 years. As part of his story, he won the lottery three times. The way he did it was that people who had won the lottery in the neighborhood would have to go to him. He would buy the ticket from them and then go cash it. This is like a famous mafia thing known as the numbers game.

Shaan Puri

wow okay I had no idea yes I don't know maybe if people have good ideas on what what part of life could use instant liquidity I'm curious to see to see what that that would be okay so a couple other things I wanted to bring up one is a pain? Or kind of a business opportunity maybe this exists if it exists tell me because I wanna use this service so in ecommerce most ecommerce brands are just local in their own geographies and most are let's say most us ecommerce brands basically just sell in the us and then it takes time and then you start selling in canada and then you start selling in europe and then you know but it takes a long time and the reason it takes a long time is because of the like international logistics so for example you wanna ship something to canada they have to pay like pretty heavy duty like import duty on the product so you sell like a $50 product they're gonna have to pay like $20 of import taxes in addition to the shipping so it just becomes like irresponsible to buy and still some customers do because they can only get the product from the us based company but it really sucks and then the company has to like fill out this form that says that these goods are worth $14 and then you submit that at the thing and then it's just annoying right and so I think there should be a company so there's these brands trying to do these e commerce roll ups I think you should do it differently I think some enterprising entrepreneur can basically say look I will boot up your canadian operation today I'll boot up your uk operation your france operation I'll do europe I'll do uk I'll do australia whatever right so basically say I'll import your brand today you do no work so all you have to do is you need to ship me this product to this warehouse so here's the address ship me your products I need like you know whatever your normal inventory is ship 10% to me and let's see how I do and basically you get one giant warehouse where you're warehousing for all the brands that you're gonna work with and you just say look in exchange for doing this you pay me no money I will start generating sales for you but I want a royalty I want a royalty of 10¢ or 15¢ for every dollar

Sam Parr

that you pay. What like how is this how is this interesting or new

Shaan Puri

Because I don't know of a brand that does this, that exists. You know, my wife has an eCommerce brand. We sell in the U.S. I would love to be making more money by selling in Europe, but the time and operational overhead to go to Europe right now is just crazy. So, why aren't there more people reaching out to eCommerce store owners and basically saying, "I will run your international operation and make it a low-risk to no-risk proposition for them in order to do so"? I think there's a lot of money to be made given the number of eCommerce brands in the U.S. and how you could, if you're in Brazil, or you're in Australia, or you're in Canada, or wherever, become the leading trusted partner. It's kind of like, "We are your go-to market plan for Canada," and we just do all the work for you.

Sam Parr

This is actually quite common in media. There's Business Insider India, Business Insider Australia, and Business Insider Germany, I believe. Then I think the Wall Street Journal does the same thing for those same countries. But it's... there is BuzzFeed France, HuffPost France, HuffPost Australia. It's actually pretty common in media, and I... [trails off]

Shaan Puri

Is it run out of the U.S., or do they hire a team there? Or is it a local team that just licenses the brand, basically?

Sam Parr

When they report the revenue, it's under licensing. I don't exactly know what that means, though, because I was thinking about us. I was like, "Man, we have a lot of people who are English as a second language folks in Germany." So, like, I guess Germany is one of the most populous places in Europe. It's very business-focused. You know, the Germans liked us, same with Australia; Australians loved us. I was like, "Yeah, let's go do it." But what the heck do I do? Do I just fly over there and start recruiting? It's crazy. I would love to partner with someone. Another thing is, in particular, China and Japan. There's actually a whole word for this. There's a word—I can't remember what the word is—but there's a word that describes why it's difficult to break into Japan. The reason is that it's hard to break into an island, particularly Japan. I would love to have paid someone to be like, "Hey, can you be my Japanese consiglieri? Like, my capo on the ground?" Those are all mob terms because I'm into the mafia now. Can you be my guy on the street in Japan and let me know if this is good? Am I getting the right people? I think that's incredibly interesting.

Shaan Puri

Yeah, exactly. So, I'm not saying that this doesn't exist. I'm saying there's still a lot of room there because I know a lot of people. I have a lot of friends who are doing e-commerce. We host Club LTV, and there are about 75 to 100 e-commerce brands, each doing over $1,000,000 a year. Every single one of them, I think, has the same problem, which is that we're all U.S.-focused. Why are we U.S.-focused? Because it would be too much of a lift to figure out how to do Australia. It's too small of a pie to allocate manpower or brainpower on. But if somebody in Australia was like, "Hey, look, this is what we do. This is our business model. We help you get sales here, and we just take our cut," then I just think that there needs to be more opportunity for this. That's cool that in media, it sounds like there's also an opportunity to do it in media too, or it's being done in some way by the big players.

Sam Parr

It's being done in some way, but I remember when BuzzFeed was going through some troubles. They had to lay off like their whole French office, and I was like, "BuzzFeed has a French office? What the fuck?"

Shaan Puri

Well, that's the opposite, right? We have a French office, and then you have to do things like that when it's not working out. I'm saying no investment, no consulting fees. You just take a royalty on sales, and these are all incremental sales that I wasn't getting otherwise. You take care of the whole operational headache. In this case, for e-commerce, it's about shipping your goods to your warehouse, and then you ship it to local customers. Customers don't have to overpay, and they don't have to do import duties for every order they make. So, I just think that there's an opportunity in e-commerce to be the go-to brand for every D2C brand to partner with in each of these locales.

Sam Parr

what country would you go to next

Shaan Puri

I think Europe is probably the best because you want the next wealthiest, high populous place. But really, it can work anywhere. It's just that the biggest market is doing it, you know, throughout Europe. Now, Europe is made up of so many countries. Maybe that's a pain in the ass. If not, like Canada is the no-brainer. Australia next, Japan is a good one, and those would be the ones. India maybe. For example, I know a bunch of people in India who did this. My dad introduced me to these guys, and I was like, "Oh wow, why is this guys' house so humongous? How, you know, what do they do?" I was like, "Oh yeah, they partnered with Jockey underwear, and they just became the Jockey seller here. They have exclusive rights to sell Jockey in India." Next guy at the dinner table, "What do you do?" "Oh, we're the Domino's guys in India." "What? Yeah, we're the exclusive franchisee of Domino's for India." Okay, what does that mean? Well, Indians didn't really eat pizza before this, so we're like teaching people to eat pizza. They love it, turns out. And so we have like, you know, 9,000 Domino's throughout India now. "Oh my god, what is going on here?" So, you know, local franchisee but for...

Sam Parr

what's this called what's the term what's the term for this

Shaan Puri

I don't know. You know, maybe I should have gone to business school. I think it's probably just called "franchising." Franchising was the way to spread geographically. You know, when your brick-and-mortar can only scale so fast, that's how you would do it. You would franchise out, and then the franchise would pay a royalty back to the master franchise of the brand based on their sales. They're the local operator. But with e-commerce or digital media, it's a little bit different. It kind of has the same problem, so I don't know if there's a new word for it.

Sam Parr

Man, I think this is **wildly fascinating**. I didn't think it was that interesting at first, but now I know what you're talking about. I've heard so many stories of the same thing, but maybe not of India. It's like, "I am the official importer of X, Y, and Z."

Shaan Puri

Yeah, we're the distributor of X. Or like, for you, just think about your business, right? What could you have sold for more if you had, like, 250,000 or 500,000 subscribers in Japan?

Sam Parr

Dude, I think there's a world where I could have made more money in those markets than I did in America. Even though America has more people, I don't think the French or the Germans, I don't think Facebook kicks as much ass over there as it does here with Instagram and everything. So, I think the ad markets... because I do think that Europe—sorry Europeans if you're listening—I do think that you guys are 5 or 10 years behind when it comes to some technology stuff. And the ad markets suck because of Facebook and Google. So, if you could still capture a little bit of that revenue, I think you could.

Shaan Puri

well I I don't know if any of that's true but I what I do know is that

Sam Parr

it's true trust me

Shaan Puri

as you're building well I think like everybody uses facebook everywhere

Abreu Andrade

so that

Shaan Puri

that's the part I'm saying I don't know

Sam Parr

well sorry but what I mean is like old media still does quite well abroad

Shaan Puri

Okay, that's fair. The thing I'm just saying is, like, if while you were building your U.S. business and all your employees were focused on your U.S. business, if somebody said, "I love your product! I'd love to license the brand from you," or "I'd love to be your partner in the UK, Japan, or Australia, and I will build it. I will use the same playbook. It'll be under your company; I just want my cut for building this for you," you would have done it in a heartbeat, right? So, the fact that you didn't means there was an opportunity for some entrepreneur who should have been reaching out to you, saying, "This is a no-lose proposition. You still own it. You still make money off of it. It's still your name brand. I just get to basically take your brand, take your product, and localize it or distribute it here where I'm from, and I know the market."

Sam Parr

yeah and my product's way easier than yours

Shaan Puri

it was right

Sam Parr

Because it's pixels, it's not anything real. I would have loved to have done that. I used to have people email me all the time, and then we had a bunch of people in Russia, some people in Mexico, who would just verbatim copy our stuff. I would have to find it and I'd be like, "You guys, stop this. You're not allowed to do this." And then I'd have other people who'd email me and be like, "Hey, can I transfer..."

Shaan Puri

Stop anyone from doing that. I feel like you can't do anything if somebody takes your newsletter and they just word-for-word transcribe it in Russia and they're like, "We're called whatever." How is that hustle? No, there's nothing you could do.

Sam Parr

The only thing that I was able to do... We had someone do this in Italian, we had someone do it in Russian, and we had someone do it in Mexico. Yeah, Mexico. I basically shamed them. I said, "I'm just gonna call you out." So I would tweet at them or I would email them. I would just make it well known, and my network was large enough that someone... someone knew them and they were...

Shaan Puri

knock off

Sam Parr

and they yeah and they stopped doing it but no I didn't do shit

Shaan Puri

you can't do shit and I had

Sam Parr

Yeah, and I had people email me all the time saying, "Hey, can I do this for Spain?" I would say, "Yeah," but I don't really know anything about you. I don't know if you've got good taste... I know nothing about you. And I would just throw it off to the side and kind of forget about it. But I wish I would have done it.

Shaan Puri

I'm surprised this doesn't happen. Well, I'm surprised there's not just like "FreeMedia.com" based in Cyprus that basically takes all the content from behind the paywall of *Wall Street Journal* and just says: "Cool, if you ever hit a paywall, come here. Input the URL you're trying to go to, here's the article for free." I'm surprised somebody hasn't just tried to do that. Like, it's totally bootleg, it's piracy, right? But it is so hard to enforce that stuff. I can't believe that somebody internationally isn't doing that. That seems like the way to do it.

Sam Parr

do you know what outline.com is

Shaan Puri

I know about it, and I know I don't know what I could say publicly about it. But yeah, I know. Explain it.

Sam Parr

I don't have any insider information, so maybe you do. I don't. I'm just explaining what it is. So, Outline.com—its tagline is "Read and annotate without distractions." Frankly, I have no idea what that means. But the way that I use it, and the way that everyone else uses it, is when you come across a paywall website, you put the URL into Outline.com, and you can see the whole article. It just doesn't work for everything. I don't think it works for The New York Times, but you can get...

Shaan Puri

You can get over that bunch of sites. They kind of stopped working on it, but initially, it worked on everything. The person behind this is somebody we know; they're a well-known tech person who works at one of the big companies. They had to distance themselves from it because it was getting millions of hits. People were using this thing, and they had to distance themselves from it because they were like, "Yeah, I was kind of told I had to knock it off." He's like, "I know I didn't make it for that purpose; it just works that way." But yeah.

Sam Parr

Is it a Brazilian site? Oh my God! Oh, okay. I see, yeah, I know who you're talking about. How interesting! Outline.com? What the heck? It's that big? I just googled it, or I just looked at SimilarWeb about how big it was. Outline.com is crazy fascinating!

Shaan Puri

Yeah, so I think that one's cool. Alright, Abreu, how did we do on the weight?

Sam Parr

hold on yeah just a quick question does outline.com make money

Shaan Puri

I don't think so I I don't know I I have no idea

Sam Parr

Wow, this person is so interesting. Alright, that's it. That's the episode. By the way, for the people listening, we actually just did a Q and A before this. It was Sean. I think it was too much talking. We gotta do the Q and A in the second half because...

Shaan Puri

oh yeah I'm fucking exhausted right now but like I'm feeling the blood is drained from my body right now

Abreu Andrade

dude I'm I'm tired from listening like how the fuck is this going

Sam Parr

I'm so dead. If we're going to do 2 hours again, we have to do the heavy lifting at the front.

Shaan Puri

I tried to keep the energy high, but in my brain... I also haven't eaten anything today, so I'm just like dying on all fronts right now.

Sam Parr

I'm hurting I'm hurting

Abreu Andrade

yeah no q and

Sam Parr

a is gonna be

Abreu Andrade

a separate episode dude so we are we're getting 2 episodes out of this

Sam Parr

yeah we gotta I can't do it next time

Shaan Puri

there we go I thought we would be able to but this was this was painful

Sam Parr

maybe this is hard

Abreu Andrade

and sam will be on

Shaan Puri

the way

Abreu Andrade

for another one tomorrow

Sam Parr

Yeah, I can do another one tomorrow. I can do one a day easily. I think I can.

Abreu Andrade

Yeah, we'll have to try something else if we want to continue the Q and A's. I liked that one. I thought the Q and A was almost better than the actual episode. Maybe because you guys were tired, but the Q and A came out a lot better than I thought.

Shaan Puri

I think people are gonna like both of those

Abreu Andrade

yeah no the whole thing is good so good job guys