Elon Musk and His $44 Billion Twitter Deal
Mobile Minorities, Disruptive Innovation, and Fear - April 27, 2022 (almost 3 years ago) • 42:44
Transcript:
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Sam Parr | I just saw that if you go to Brett Taylor, the chairman of Twitter, he just tweeted, "We've agreed to a deal with Elon Musk."
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Shaan Puri | oh wow wow | |
Sam Parr | so I guess I think I think saying it's done is fair | |
Shaan Puri | Yeah, that's fair. Okay, so **$54 a share**. Wow!
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Sam Parr | So let me tell you something really quick. This relates... this is going to sound weird, but it relates to what we're talking about.
Do you know how a combustible and non-combustible engine works?
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Shaan Puri | do I look like I know how a combustible engine works no | |
Sam Parr | So, alright, here's how a combustible engine works.
You've got this huge block; it's called an engine block. It's this big piece of metal. Imagine a rectangular cube that's about 2 and a half feet long, a foot wide, and a foot deep.
When you hear terms like "4 cylinder," "6 cylinder," "8 cylinders," or "12 cylinders," that's how many cylinders they're going to drill into that engine block.
So, how do you know how big a cylinder is?
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Shaan Puri | well I've I've eaten pringles before so I could sort of imagine | |
Sam Parr | You're not far off. So, it's around the size of a can of Coke—almost a little bit bigger. But for the sake of this explanation, we'll say it's like the size of a can of Coke.
In those cylinders goes a piston, which is basically like... you drill those holes, and you've got something that's almost the size of a can of Coke going back and forth through those holes. The way it works is you have a shaft that connects to the pistons, which turns that up-and-down motion of the cylinders into motion that the engine can use.
But check this out: in order to make this all work, you have this thing called a spark plug in each cylinder. Then you have this other device called a carburetor, which mixes the perfect amount of fuel and air into the cylinder. The spark plug makes a small spark, and there's a miniature explosion in the cylinder that creates so much pressure that the piston is moving up and down.
Does that all make sense?
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Shaan Puri | okay I fall I don't know why you're telling me about this but I I understand it now | |
Sam Parr | Listen, so it gets even crazier. You know how you're driving and your car will say like 6,000 RPMs?
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Shaan Puri | yeah sure | |
Sam Parr | That means that those pistons... So, these pistons, they have to be airtight for that explosion to occur in the cylinder. These pistons are super tight in that cylinder, and they're creating a lot of friction.
When it says 6,000 RPMs, that's 6,000 revolutions per minute. 6,000 means you're driving pretty fast, but not crazy fast. That means those pistons are moving up and down 100 to 150 times per second.
Wow! And you have oil in your car because those pistons are rubbing against metal, and it needs oil. Otherwise, if you leave it without oil, they're moving so fast that it's going to fuse together and basically weld the piston to the cylinder.
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Shaan Puri | jeez okay | |
Sam Parr | okay the reason I'm bringing this up listen | |
Shaan Puri |
I can't wait to hear it... because I just watched a YouTube video about it and it's still fresh in my mind. That's why I had to say it.
You did? No, it sounds like you just went on a deep dive.
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Sam Parr | Well, I was thinking about this, and basically, the output of all this is like carbon dioxide. It's like a gas, and there are fumes, oil, and liquid—there are all types of fluids. Then there's a transmission, which is like totally even crazier.
Sometimes, the fact that this was invented in the early 1900s and it's still the technology that we have exploited and made so good is pretty phenomenal. We've made this so good that these pistons can move for a million miles. Basically, they're going to go up and down like a trillion plus times. We have pushed that so far to the edge; it's pretty phenomenal what we've done, and it's such a flawed technology.
It was good for what it was, and then Elon Musk comes along. He wasn't the first one to do it, but he did a really good job of it. He said, "This electric engine, all we're going to use is a battery and one motor. That's all it takes." This motor is literally like three parts—there are very few parts—whereas with the combustible engine, there are like a thousand parts.
Not only is it simpler in terms of maintenance, but there's basically no maintenance. It's far better. I own a car that's considered incredibly fast, and it's quite expensive. It goes from 0 to 60... well, it's considered fast, and it goes from 0 to 60 in three seconds. A Tesla that costs $40,000 can crush that.
So, it's faster in every sense of the word. It doesn't break. I kind of had one of these moments where I was like... I wasn't actually high, but it was like one of those high moments where you're like, "I..." | |
Shaan Puri | can't believe you just decided to have high thoughts without sprinklers | |
Sam Parr | Had high thoughts. I was like, "Dude, we've been doing this combustible engine thing for like 130 years now." Then along come a couple of people who are like, "No, no, we're going to do this totally opposite way."
So instead of making an engine that just somehow has more cylinders or is smoother, we're going to do something totally opposite. It's like levels above in terms of quality, and I find that thought to be absolutely amazing.
It just turns out he just bought Twitter today, so maybe something crazier is going to happen there. I actually don't think it will, but maybe.
But isn't that wild to think that we can literally... I don't know how many people have existed since 1910—billions and billions of people. We've all been doing it one way, and then along comes a very small group of people, let's say tens of thousands or hundreds of thousands, who said, "No, no, no, this is the way to do it," and it changes everything. I find that to be amazing. | |
Shaan Puri | I agree, that is amazing. A couple of thoughts came up while you were saying this. First of all, thank you for the engine lesson.
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Sam Parr | does that make did that did I | |
Shaan Puri | I'm 10% more man because I I know how to describe this happening | |
Sam Parr | did I explain to you do you understand how the engine works now a little bit I do | |
Shaan Puri | Oh, a little bit, yeah. I feel like I'm at that perfect point where I know... because I don't know what I don't know. If you've ever seen the Dunning-Kruger effect, I'm at the perfect peak.
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Sam Parr | What you should know, the takeaway here, is that it's very, very, very crude. You've got these metal-on-metal surfaces rubbing against each other, creating... it's just messy. It's smelly. It's crude. | |
Shaan Puri | Well, I just did something today that reminds me of what you're talking about. I went to the doctor, specifically the eye doctor, for an eye appointment. Not because I wanted to, but because I was like, "Just give me my goddamn contacts!" They said, "Nope, you gotta come in. It's been two years now, and you gotta do the whole thing where we blow a puff of air on your eyeball." It's like, "Oh my god, what is that even for?" I don't know.
But I went in and decided to have a little bit of a different attitude. I got really curious when I went in this time. I was talking to the doctor and asking a bunch of questions. She ran this other test on me where she took a picture of my eye and then showed it to me on a screen. I don't know if you've ever seen the inside of an eye...
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Sam Parr | it's disgusting | |
Shaan Puri | Fucking wild, dude! This is crazy. She's like, "Okay, so this is the nerve in the back of your eye. That's what's sending all these signals. Your eye's just getting light from everywhere, and your brain is... this nerve is the thing transmitting to your brain all these light signals. Your brain is piecing together some of the amazing..." | |
Sam Parr | construction of the world | |
Shaan Puri | Yeah, it's amazing. So, like, these are all the blood vessels that are keeping your eye alive. Whenever I see how the body works, I just sort of marvel at it. I'm like, I don't have to think, but my liver knows how to detoxify my body. You know, I don't have to think; my heart will just keep beating reliably, or else I'll die. Luckily, it's on autopilot. In fact, it's on so much autopilot that I couldn't stop it if I wanted to.
The way that the human body works is just a true marvel. So, today is my birthday, and seeing that... oh, I forgot.
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Sam Parr | to tell you on air happy birthday | |
Shaan Puri | Thank you, I appreciate it. We talked earlier on the phone, but the thing that amazes me is that the best thing to do on your birthday is to just get a scan of your body and be like, "Wow!"
You know, the human body is like an absolutely incredible machine that just works in the same way. I don't know how an engine works. I don't know how my liver works. I don't know how my kidneys work. I don't know how my lungs work. I don't know how any of this works, but it does work.
Just the fact that it does is kind of amazing to me. Seeing my eyeball, my retina, and the nerves and blood vessels in my eye was just a reminder of how humbling it is. It's like the humility of realizing that you don't even have control over your own body, let alone the world and all these other things that are going on.
So, I really appreciated that. That's the first thing. The second thing I wrote down the other day for the podcast, but I never knew how...
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Sam Parr | by the way are you wearing a mighty ducks jersey | |
Shaan Puri | yeah dude it's my birthday I'm feeling like a mighty duck right now | |
Sam Parr | oh my god that's awesome | |
Shaan Puri | The older I get, the more I need to behave like a child. Right? Like, that's kind of the game plan: to get more childlike as I grow, not more adultlike.
So, I wrote this down: "vocal minority, mobile minority." I didn't write it down like a month ago, and I was like, "Oh, it might come up at some point in the podcast."
What you just said about Elon, about basically a very small number of people changing the way that things work, is a great example of this.
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Sam Parr | So, it's not like he's the guy who came up with this. We can't say that Elon came up with it; we could just say that there are probably a lot of people who came to the same conclusion. He just had the strongest will and is the person to whom we give a lot of credit. | |
Shaan Puri | By the way, have you seen what he's been saying lately about this origin story of Tesla? Have you seen this controversy?
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Sam Parr | no so does he say that he's the founder | |
Shaan Puri | No, no. So, what happened was Tesla started about a year before Elon invested in it. Now, he's seen as the CEO of the company. He is the CEO, but he's also kind of seen as the founder. You don't really hear about these other guys who started it—these two guys that were starting it, I think.
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Sam Parr | And he is kind of the founder. When you think about it, it's literally the 8th largest company in the world. At the time, it was worth around $10,000,000. What's the difference?
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Shaan Puri | Exactly. So, the guys who started it have basically made it kind of like their mission.
There’s a group of people who are anti-Elon; they’re a vocal minority against him. They’ll say things like, “Elon didn’t create Tesla; he just invested in it and takes all the credit for it.” One of the original guys has really made it his mission to keep telling people how much he was the founder of Tesla, not Elon Musk.
Elon sort of came out recently and said something in an interview. They asked him, “What’s the biggest regret you have in business? What’s the biggest mistake you made or bad decision you made?” He responded, “Well, certainly the worst business decision I made was not deciding to just start Tesla on my own with me and JB,” referring to the guy he started it with, who he feels was his co-founder.
He mentioned that he should have bought the existing company and then built from there versus just doing it on his own. He said, “Certainly that was the worst decision I think because financially that guy owns shares of what’s now a $1 trillion company.”
The second thing is that this guy has basically made it his crusade to say, “F Elon Musk, I’m the founder of Tesla.”
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Sam Parr | know how much does that guy own | |
Shaan Puri | I don't know the exact percentage. Maybe somebody, Jonathan, can look it up while we're talking. But that guy basically...
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Sam Parr | martin and there's like I think his name is | |
Shaan Puri | There are two guys, Martin and someone else—I think that's his name. One of the things they say is, "You know, we created Tesla."
Then Elon has come out and been like, "Tesla was nothing. There was no product. It was basically a shell of a company. There was no... it was like, you know, pre-launch, pre-everything."
I invested $6.5 million, and I think he invested in the first round, knowing also that I'd have to invest way more after that. He took a chairman role and then, like, basically had the guy who designed SpaceX's logo design the Tesla branding.
You know, he's like, "I guess he created it." It was an inactive company, is what he had said. I think he tweeted something like this out—that it was like a dormant company or something like that.
So there's some controversy around the actual founding of it, but yeah.
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Sam Parr | How is that his biggest mistake? That doesn't seem like that big of a deal. It worked out fine. Also, one could argue maybe it was worth it just for the name.
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Shaan Puri | Yeah, exactly. Just for the name, I guess his take would sort of be like the company was just going to die if he didn't invest in it. | |
Sam Parr | I think | |
Shaan Puri | He was the only investor at that time.
So anyway, back to my vocal minority. We see this a lot on Twitter and other places where there's a vocal minority. This is what people call cancel culture. This is what people will refer to as the haters or the naysayers online.
There's a small group of people that are sort of unhappy about anything that happens. They'll be unhappy that Twitter is being bought by Elon Musk. They'll be unhappy that he's a billionaire. They'll be unhappy that Tesla... they'll say that Tesla's cars, yes, they're electric, but what powers the electricity? It's coal. You know, they just always have something to say.
So there's a vocal minority, and I think one of the biggest skills for any business person today is to correctly identify a vocal majority versus a vocal minority. If you just constantly let the vocal minority sway your thinking, you're letting, you know, the bottom 1 or 2% of people sway your decision-making just because they're very loud about it.
But then the other... so I think you want to overlook them. What you don't want to overlook is what's called, and I call, a mobile minority. A mobile minority is a group of people who decide to actually take their business and walk elsewhere, or they take their lifestyle and just change it.
So it's like, you know, if you're Safeway, but all of a sudden there's a small group of like sort of hippie people that are buying this all-natural produce.
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Sam Parr | right | |
Shaan Puri | And they're shopping at this place called **Whole Foods Market** in Austin. They only have one location, or maybe two. But like, all of their spending now goes to this.
Or you see people that are, you know, on Netflix or whatever. People who are subscribed to Netflix, but all of a sudden, they start to spend all their time on TikTok and YouTube. It's like they've actually voted with their feet.
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Sam Parr | or they're they're they're | |
Shaan Puri | something silent | |
Sam Parr | I mean, even a different non-business example: I was just reading about Martin Luther King and Rosa Parks. When the whole Rosa Parks thing happened, the Black folks were like, "No, we're not talking about that."
Originally, it was like, "Well, that only makes a certain amount of our population; it's no big deal." Then it goes on for like two weeks, and you're like, "Alright, something's happening."
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Shaan Puri | And it's happening in San Francisco right now. A mobile minority of people have left San Francisco and taken their business elsewhere. It's a very small group of people. Some of them were loud about it, saying, "I'm leaving because I have this, this, and this beef with San Francisco." Most of them were just frustrated, saying, "I'm going to Austin, I'm going to Miami, I'm going elsewhere. I'm going where I will be treated better, where I will be taxed less, and get more from my government."
Those mobile minorities are actually the ones you want to listen to, whether you're a politician or an entrepreneur. We talk about this a lot. There's this subreddit that's getting really popular. It's like, "Oh yeah, it's only 50,000 people," but it's like, "Wow, 50,000 people have chosen this lifestyle of either anti-work or overemployed, or they're tracking their fitness and their sleep in this maniacal way."
That's something you really want to pay attention to. It's a great place to start a business when you notice a mobile minority. It's also a really important thing to notice as a leader of either a city or a company. You should ask yourself, "How come all these developers are going to this weird Web 3 crypto thing? What's that about?"
So yeah, it's not everybody, but wow, like, you know, 10% of our smartest people all left to go do this thing. They took a pay cut to go do this thing. I think I should probably pay attention to that. So, I wanted to...
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Shaan Puri | This out, which is to ignore the vocal minority and pay extra attention to the mobile minority.
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Sam Parr | Has those... mean there's another side to this. It doesn't mean they're right.
So, for example, or that like what they're doing... I agree with you. I would also challenge myself to find examples where there is... that's a great... what's it called? Mobile minority? Yeah, that's a great... that's a good one.
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Shaan Puri | trademark that we're trademarked that that's a my first million original | |
Sam Parr | So, like, there are people—like, for example, day trading among young people has gotten incredibly popular. I don't think the majority of people do it, but I think there are a lot of people who do it. They're very loud and they're betting a lot, and I think that's horribly stupid. | |
Shaan Puri | Yeah, I'm not saying it's always a good thing, right? It might be people vaping, and it's like, wait a minute, like 10% of teenagers are vaping now. I'm not saying it's always healthy, but I'm saying it is almost always worth paying attention to this sort of silent and mobile minority.
Whereas I think the vocal minority is almost always worth ignoring. | |
Sam Parr | You want to talk about a few examples of those groups of people? Well, I'll give you some off the top of my head.
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Shaan Puri | you a couple I think I can think | |
Sam Parr | of a few more | |
Shaan Puri | yeah give give me give me give me give you some | |
Sam Parr | I'm just going to write off a few things that I'm noticing based on Reddit and my interests.
**1.** People who don't want to buy off Amazon because they don't want to have to worry about throwing away the packaging.
**2.** People who want to use reusable packaging. For example, a Ziplock bag that you'll pay $20 for, but you can use it over and over again.
**3.** People who don't want to eat out of plastic.
**4.** [Next point to be continued...]
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Shaan Puri | I have another one that's related to that. My wife's vegan, so everything we do has to be compatible with a vegan lifestyle. You'd be shocked how much is not compatible.
So, like, okay, you think about food; I think food is where most people go. But leather is another huge one, right? We're about to buy a car, or like she wants to buy a fancy purse or something like that. She's ready to go to whatever, Louis Vuitton or whatever, and drop $5,000 or $6,000, whatever it is. But she won't do it because it's all leather.
She's like, "I can't believe these luxury companies don't make one non-animal-based product." They don't make one bag. Even if they did, they would get all of the vegan people who want to buy luxury. Exactly! Go to whichever brand makes it, like all of the big ones: Gucci, Prada, whatever. And they just don't make it. Or if they do, they'll make the bag but not the handle or the strap.
She's like, "Well, that's the thing. If you cared about this, you'd care about this." We see that with cars too. Tesla has all vegan leather, and they're one of the few carmakers that just lead with that.
These little things are super easy to overlook. I would totally understand saying, "Look, we're not going to change our product line for this 1 or 2%." But as that 1 or 2% gets big enough, I don't know how much the vegan population is now in America, but let's say it's 2 or 3%. That's of a base of 300 million people. And those are people who don't just kind of care about it; they really care about it.
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Sam Parr | they're the they're the mobile minority and the vocal minority | |
Shaan Puri | for sure yeah exactly | |
Sam Parr | they they use they they they do action and they talk a lot | |
Shaan Puri | Yeah, exactly. So, like, you know, you make a chocolate, make a cheese, make a car, leather, whatever. So that's an example where I've seen a lot of wallet share go to the one brand that just cares about it. | |
Sam Parr | What else is there? I think there's also, when I read the TikTok comments, there are so many people who, when they post videos of people from the early 2000s, or when I was in high school in 2008, say, "Oh wow, look, no one's on a cell phone. They must be so happy."
So, I think there's going to be a mobile minority of people who actually don't want smartphones.
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Shaan Puri | the the disconnect / digital detox population | |
Sam Parr | yeah | |
Shaan Puri | There's also a group that's like VR... like absolute VR nerds. They don't talk much. In fact, most of the dialogue around VR is how it's not here yet or it's, you know, not gonna happen.
There's a small number of people that spend an absurd amount of time in VR. They work in their VR. I don't know if I... I think I sent you this TikTok of a guy who says he's spending 24/7 in VR. He literally wakes up, puts the headset on, and spends his whole day like that. He even goes to sleep in VR, and then, you know, the headset falls off or whatever, and he sleeps. It's like some... some nut.
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Sam Parr | what they look like | |
Shaan Puri | I close your eyes and imagine this guy. Yeah, like, yeah, yeah. The beard touches the chest hair, so there's no line.
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Sam Parr | We need strong borders. There's no strong borders. He has a rack just for fedoras.
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Shaan Puri | Right, like his ferret is the winningest movie.
But basically, you know, there are some people that are spending a lot of time there. I don't know if that's a big one yet, but I've just sort of branched off the top of my head. You know, people who really, really care about certain things.
I think you'll see this with pet stuff. I think you see this with house stuff that's going on. If you're in the gym business right now, you know the mobile minority through COVID has been home gyms. Those people are never coming back. Once they put like $1,000 of gym equipment in their garage or their bedroom in their house, they're not coming back into the gym industry.
So it's a mobile minority. They have voted with their feet and now they're going down a different path, a different lifestyle. | |
Sam Parr | Yeah, I think that’s a really good term. I’m on board with "mobile minority," but what does it have to do with engines?
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Shaan Puri | It’s about the few people that go and actually do something different, right? So, like you were saying, Elon and the sort of the electric car.
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Sam Parr | movement yeah yeah | |
Shaan Puri | You know, that's a small number of people who just took a sharp left turn and decided, "Nope, we're going to get off the oil and gas system. We're not going to have a combustible engine car. We're not going to buy from any of these brands. We're just going to go fully electric."
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Sam Parr | Do you think... but here's the thing I've been thinking about when I consider him and people like him. I think, okay, so obviously he's right. This Tesla thing, like, it's right. But it didn't seem that way all the time; it seemed like the total opposite.
There are moments in my life where I'm like, I firmly believe that this is the future. I firmly believe that many homes are going to be bought online, like that's an example. But along the way, I have so many doubts where I'm like, "Ah, screw it."
So what I would like to know is... I wonder how he, because he doesn't give off the appearance that he ever has doubt. He's like, "No, no, no, this surely just makes sense." Then he does say all the time, "I think we're going to go bankrupt." But that doesn't mean he thinks that his idea is wrong. He just thinks that maybe they're just going to run out of money because they didn't have enough runway.
So do you think that someone like him, or a lot of these other people like that, have self-doubt? Or what?
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Shaan Puri | You move straight to the end. Now, if you listen to him talk, he actually says three things.
He says, "How did you decide to do this? No car company had ever... no American car company had been made since Jeep, like, 90 years ago or something like that. Nobody had ever made an electric car, you know, that was popular. A fully electric car. Nobody had ever started a rocket company, a private rocket company, all this stuff."
He basically just said, "So how did you decide to do it?" And he's like, "Well, I agreed that the probability of success was low, but it was worth doing, so I just did it." You know, he's basically like, "I thought it was worth doing. Humanity needs this, so it's worth doing." Certainly, the probability of success is low.
Then he said one other thing, which was like, "Did you ever think about giving up?" And he's like, "It's not in my nature." I think it's so... if you take those three things, it's like he doesn't decide to do it because he thinks it's gonna work. In fact, he decides to do it because he thinks it's worth doing.
He agreed that the probability of success was low but not impossible, and he just decided that he's not gonna give up. That's not in his nature.
So you combine those three things: doubt has very little place, right? It's like, "No, I've accurately taken into account the low probability of success, and then I'm not gonna quit." So, I just already decided it's worth doing.
In that case, doubt can't live in that home. That's a two-bedroom home, and doubt doesn't have a room in that house. So, I think that's the psychology I've seen, not knowing the guy, just from his interviews. | |
Sam Parr | But I don't... I'm not sure if that's the entire reality, even though he said that. And here's why: Did you ever pay attention to boxing in the nineties with Mike Tyson?
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Shaan Puri | sure yeah | |
Sam Parr | Alright, so Mike Tyson came on the boxing scene when he was 19. He was like "the man" until he was in his early thirties.
When he walked out of the stadium to the ring, he was famous for wearing black shorts, black socks, and black shoes. He would come out with no shirt on, with his gloves already tight, as if he was just ready to roll. Typically, that's not how they do it.
He was already sweating and he didn't have a song that he came out to; he came out to a noise. That was just his whole thing—about being frightening. He would say, "I am a tiger. I'm a beast. I am here to kill."
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Shaan Puri | And yeah, he would say things like that, like "I'm gonna take out your heart and eat it." Yeah, and he'd be like, you know, what was the great interviewer? He's like, he...
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Sam Parr | goes he goes I'm gonna die | |
Shaan Puri | is impregnable my my my will is unstoppable praise be to allah | |
Sam Parr | and he goes and he goes I'm gonna eat his heart I'm gonna eat his children | |
Shaan Puri | I'm gonna eat his teeth | |
Sam Parr | Allah, like, this is great. He goes, "I'm Alexander the Great." He ain't no Alexander the Great. I'm Alexander the Great! Yeah, like, the scariest stuff.
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Shaan Puri | bravado yeah | |
Sam Parr | Scary guy. When he would look you in the eye, you’d think, “This guy’s gonna... this guy’s gonna murder him.” He’s not just gonna beat him up; he’s out to kill him.
I would watch interviews with him now, as he’s older and doesn’t have to act that way anymore. He goes, “People thought I was so deadly. I was deadly, but I was so afraid.” The reason I acted like that was because, in reality, my fear was on the total opposite end. I had to act that way because I was so afraid.
I’ve heard a bunch of UFC fighters that I like, like Donald Cerrone and Chael Sonnen, and they’ll go, “Every single time I’m backstage, I think to myself, ‘Why did I do this? Why didn’t I quit? I don’t want to do this. I’m afraid. I am so scared to do this.’”
Right? I’m afraid. This guy, who I’m talking about, Michael Bisping, he’s got the biggest mouth of everyone. He talks the most trash. When I heard these fighters start saying this stuff, I was like, “Oh, you’re the toughest guy on earth right now.” But even the toughest guy on earth is scared.
Yeah, and so that’s kind of... | |
Shaan Puri | They go into a cage fight with another guy who's trying to kill them, in their underwear, in front of millions of people. And after talking mad shit, right? So it is one of the most vulnerable positions you could put yourself into.
That's why it's great to kind of learn from them and hear their thought process. I think that's true. Somebody had said this about Elon. I think it was maybe Jervis, one of the investors who invested in Tesla and SpaceX. I believe he has never sold a share and never plans to sell a share of any of those companies.
So, you know, this guy's got the best returns ever because all his bets were just bets on Elon. He said something like, "Elon is just a normal guy, but the fear gene got removed." In his DNA, the fear gene got removed.
I actually think that it's not that nobody has fears; it's that the extent to which you are fearless is the extent to which you learn how to dance with your own fears. Those UFC fighters feel the fear, but they learn how to cope with it. For Mike, it was getting into this primal state of mind, saying certain things, and just walking to that sound. That's how he was able to dance with that fear.
I'm sure that someone like Elon Musk, even though they have fears of failure and humiliation—like when three rockets blow up for SpaceX, you know, just explode—and now you've basically put all your money in, and you have enough for one more launch, and that's it. You had to rush and do one more launch.
I don't think he was sitting there with a resting heart rate of 46. I think he was feeling something at that time. You could see it in the videos—the relief when it happens. But he learned to dance; he learned to deal with it.
So I think that's the difference between people who seem totally brave and fearless: they have just learned to deal with fear better than the person who lets fear slow them down or stop them. | |
Sam Parr | are any of your closest successful friends autistic or have asperger's | |
Shaan Puri | Sure, it does seem like it sometimes, that's true. To be honest, I like to get along. I end up getting along with people who are a little more outgoing, extroverted, and easier to get along with. But I've got a... you have a couple, I know.
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Sam Parr | I've got a couple of friends, and you're friends with them as well. What I've noticed is that I have one in particular who I think you know who I'm talking about.
He's very, very successful, and he approaches things far more logically. I'm like, "Well, name this... this will never work." He's like, "Well, why not? Why won't it work?"
I mean, you see on this Excel spreadsheet that the math adds up to where it does work. I'm like, "Well, but who's going to believe you? Who's going to have faith in you? How are you going to do it?"
And he's like, "Well, why wouldn't they?" You know what I mean?
Sometimes I wonder if that's just a couple of my friends who are like that, or if there is something more. Elon has said he has Asperger's. Is there something in there where it's like, you know, it's supposed to be kind of like a handicap, but in reality, it's the exact opposite? It's like a superpower.
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Shaan Puri | Well, I played poker for a long time, and you see this with poker players too. Some of the best poker players have sort of Asperger's-like mannerisms. They're extremely intelligent, but they have an emotional coolness that allows them to be rational under pressure. They don't get as easily tilted as an emotional player would.
They can play with huge sums of money and not change the way they play. It's all just chips to them; it's a game. They also have the ability to focus for very, very long periods of time—longer than, I would say, the average person.
So, there are some definite superpowers if you have that brain wiring. I don't know the clinical definition of these terms, but I'm sort of reverse defining it as a person who has those traits: the ability to have maniacal focus, the ability to stay calm and emotionally cool despite what's going on, and being highly intelligent, especially with math, probability, and statistics.
They're winners, dude. I've seen it so many times. Whenever I sit down against that opponent, that is the person I'm trying to stay out of pots with. I'm not trying to compete against them when I go play poker. | |
Sam Parr | Alright, let me tell you something interesting that happened to me. You said you went to the doctor. I went to get some things done because I bought a vehicle, and I had to get it registered. You know, like you gotta get your registration and title and all that.
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Shaan Puri | stuff dmv stuff | |
Sam Parr | Dude, it sucks. Alright, so some people listening are like, "This is so obvious." Do you know that there are third parties that will do this for you?
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Shaan Puri | I've heard about this. Actually, some guy told me, "Yeah, I was like, the DMV sucks." He's like, "Oh dude, my buddy and I opened up an alternative DMV in the DC area. It's amazing! We do like $3,000,000 here." I was like, "What? Dude, listen to me. DMV? So what is that? I never looked into it. What is the rule?"
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Sam Parr | Alright, so I went to the DMV and I didn't know you had to have an appointment to go. The woman working there was like, "Hey, just go to this thing called Fry Title or something like that."
So I looked it up on Yelp, and it was about 20 minutes away. I went out there, and there was a line out the door, but I got in and out. Basically, it's a crappy building in a strip mall, exactly like you'd think, next to a Marshall's or something like that.
You can go there to get license plates, title transfers, specialty plates, temporary permits, and you can register your car there. It has a lot of the stuff that you would mostly do at a DMV. You can't do some things, but mostly everything you need.
The way that you get it is through a partnership with the motor vehicle department of every single state. You have to go through this application process that I don't think is that hard. When I was there, I was talking to the owner, who was a young guy, about 24 years old. He was smart but unsophisticated. He said, "Yeah, I just applied."
I asked him if they always had a line because there were signs everywhere saying, "We know we have a line." He said, "No, people at 4 because we close at 5." So I asked if they were just busy all the time, and he said, "Constantly." I was like, "Are you kidding me?"
Then I asked how they made money, and he said, "Well, we're going to charge you like $50 to $100 right here for this fee." I thought, "Oh, no brainer!" Because the DMV here in Austin, I've got to wait four months or something for an appointment—something crazy.
It was a crazy service, and I started looking into it. There are a few companies in this space, you know, DMV.org. Have you ever heard of DMV.org? It's like if you Google, "What paperwork do I need in order to get a license in Delaware?" It tells you what to bring.
So that's out there, but there are basically all of these places I've seen do this. They're just like mom-and-pop, hole-in-the-wall stores, and they are constantly packed. It was crazy fascinating.
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Shaan Puri | I did hear something about that guy I was talking about. Something did end up happening. They cracked down or they lost their thing. I don't know what happened, but something bad did happen. This was years ago, so I don't remember.
But let me tell you about two other businesses that...
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Sam Parr | are very similar have you heard of aceable what's aceable | |
Shaan Puri | aceable it's in texas it's you're gonna love this business so just go to like aceable.com | |
Sam Parr | you sound like george zimmerman like you're you're gonna like the way you look I guarantee it | |
Shaan Puri | you're gonna like this business yeah you're gonna like | |
Sam Parr | this book I guarantee it | |
Shaan Puri | Men's Bro House here. So, it's basically driver's ed online. They also do, like, if you get a ticket, you have to go to corrective driving school or whatever.
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Sam Parr | oh my god these guys kill it | |
Shaan Puri | So, they're like an officially licensed vendor for this driver's ed at these courses or whatever. They absolutely crushed it. They bootstrapped for a while, and I think now they've raised like $100,000,000. These guys are absolutely crushing it!
I've seen their revenue once before, back when I looked into this. They started with a 32-hour driver's ed course, and they could do it in like 36 states out of the total. They said they have 13,000,000 people who have gone through it. They also do realtor's licenses, which is for people trying to get their broker's license.
Oh wow, that's like another amazing business! This is like a 10 out of 10 under-the-radar business that just crushes it. They succeed due to regulatory lock-in, as they're one of the only officially approved providers for this.
They crushed it with Google Ads because people would search for "driver's ed," "free driver's ed online," "get my broker's license," blah blah blah. There wasn't a ton of competition early on, and they just made a ton of money. I'm pretty sure this is a $1,000,000,000 company at this point. | |
Sam Parr | Oh for sure | |
Shaan Puri | they just you know just doing this | |
Sam Parr | This guy's name is Blake, who started it. Another Blake, Blake Mycoskie, the guy who started TOMS Shoes, his first business was an online driver's ed business, and he said he crushed it.
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Shaan Puri | oh wow I didn't know that that's interesting | |
Sam Parr | When I read his biography, it was about giving away shoes or something like that. It was one of those stories about giving.
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Shaan Puri | buy a buy a pair give a pair | |
Sam Parr | yeah and anyway this business kills it what's the other one | |
Shaan Puri | So, the other one... I was about to take a trip with my family and I realized, "Oh, we don't have passports for the kids." I thought, "Let me get their birth certificates."
You know, when a baby is born, they don't just give you a certificate. It's like, "Oh, you want a birth certificate?" They roll out this candy crush map and say, "Do these 6 steps and jump over all these hurdles to get your kid's birth certificate."
So, you have to go through this process, and you could go to the city or whatever. I thought, "Oh jeez, I don't want to do all that." I searched for "get birth certificate online fast" and found the San Francisco or Bay Area, you know, the Walnut Creek official birth certificate service.
I saw that you could either mail in the documents or go to their partner, VitalChek. I thought, "Yeah, they can handle it." And sure enough, I...
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Sam Parr | see it vital check | |
Shaan Puri | you go to vital check dot com | |
Sam Parr | You're not on there. There are so many copycats. There's your VitalCheck.com, and "check" is spelled C-H-E-K.
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Shaan Puri | That's how you know these businesses crush the number of copycats that pop up.
So, it's an official California birth certificate that you can get online. You know, it's government endorsed. Hundreds of government agencies nationwide exclusively trust VitalChek.
They've basically cut deals with those vendors. Whatever you go on here, you pay, and I don't know, it's like $99 or something per birth certificate. You fill out this form, and it's done.
It's like you kinda have to do this; it's like a mandatory thing. It's like a DMV thing. Customers aren't just choosing to go get certified; they have to get certified.
And so, that's why I love Aceable. That's why I love your DMV one. That's why I love this VitalChek thing. | |
Sam Parr | because customers crazy | |
Shaan Puri | Have to do it to comply. You can build these kind of third-party things. I sent this to Xavier and Ceeva, our buddies with Enduring Ventures. I was like, "Dude, this is a beautiful business to buy," right? Because they're going and trying to buy these businesses that are just cash-flowing, profitable businesses that have defensibility and can be maybe improved by rolling up multiple or centralizing the back office.
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Sam Parr | General operations and the other, the other like red flag... not red, what's whatever the opposite of a red flag is? A green flag! A green flag that my red flag of like "this is a killer company" is going off because the website is an ugly website with a lot of traffic. It doesn't say who the founder is on the about page. It says, "We've been in business since 1992 and we do this, this, and this." I can't find a guy on Twitter talking about it. I'm like, "Oh, okay, so you just..." | |
Shaan Puri | So, Siva got back to me. He goes, "It looks... I dug in, and it looks like it's owned by a UK public company conglomerate."
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Sam Parr | called lexisnexis | |
Shaan Puri | relex I think | |
Sam Parr | Relx, which owns LexisNexis, is like a multibillion-dollar company. I believe Relx is the most profitable company in the world in terms of margin.
They own another big thing: do you know how scientific journal publishing works? Basically, doctors and researchers come up with these amazing insights, and scientific journals say, "Yeah, we'll give you $500 for your article." That's all they get paid.
Every university has paid money to get access to these journals. As a result, they make around $4 billion in revenue and about $3 billion in profit or something like that.
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Shaan Puri | Wow, yeah, it looks like it's a $50 billion company. Wow.
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Sam Parr | what's the does can you see what the profit like what the income is they probably | |
Shaan Puri | don't 33,000 employees I I can pull up I mean I can pull up that | |
Sam Parr | it's like the I I think it's one of the how do you spell it | |
Shaan Puri | r e l x | |
Sam Parr | yeah I think it's | |
Shaan Puri | I don't know about this. This is another Sandpar special right here. Just knowing that some random British public company owns scientific journaling companies and is the most profitable company in the world... how the hell did you know that?
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Sam Parr | I confirm that it's, if it's not the most, it's one of the most. I knew about it because I had friends in the journal who were getting their PhDs. They would tell me how it works, and I was like, "Oh, that's a racket."
You don't understand; you're lucky that it's like, you know, dentists and stuff publishing things on teeth. They don't understand how margins work. I'm like, "They're paying you $500 for that? You don't understand shit." So they're just getting ripped off.
I knew right away. And second, when we were launching The Hustle, I love database businesses. I researched database businesses like crazy, and I came across this company because they own...
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Shaan Puri | it's more like they own they own lexisnexis which is which | |
Sam Parr | is like a total conglomerate | |
Shaan Puri | 1,000,000,000 legal records and documents. They own Patentsite, which has a patent asset index of 135,000,000 patent documents. Law360 and Lex Machina have around 88,000,000 records. There are just a ton of database businesses in the legal field. | |
Sam Parr | Law 360 is like... it's kind of like The Hustle but for lawyers. I mean, of course, they were first. So we were like them, but for not lawyers. It was basically a daily newsletter for lawyers, right?
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Shaan Puri | yeah elon's like me for billionaires | |
Sam Parr | Yeah, yeah. You know, the problem that I have about Elon is he just rips off my style. I was using Twitter way before. I was popular on Twitter first. | |
Shaan Puri | yeah I do memes he does memes yeah like | |
Sam Parr | he's kinda like | |
Shaan Puri | the when I am to | |
Sam Parr | podcasts he is to money | |
Shaan Puri | Money, business, and innovation. Yeah, no dating celebrities. Doesn't have a podcast though. God.
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Sam Parr | Yeah, dude, I was thinking of Jake Paul. We had Jake Paul on the podcast, and I was reflecting on it. I thought, if I got into an argument with that guy, he could just say, "Well, I'm richer than you," and I'd be like, "Well, I could kick your ass."
He'd respond, "No, I can kick your ass." I'd say, "Oh yeah, you can't." Then he'd counter, "Well, I'm more famous." And I'd be like, "Well, I'm famous too."
It's like, everything he does, he does it better. I feel like I have nothing I could say to him in a fight. He's just going to win this argument every single time. I'm screwed.
So sometimes I ask myself, "What can I possibly say?" And that's when I think about Elon.
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Shaan Puri | No, that's when you have to swerve into the virtue signaling and be like, "Well, I just don't chase money and fame." Yeah, so you're way more famous than Rich Dad.
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Sam Parr | well I wouldn't trade lies with you you're most miserable | |
Shaan Puri | I have one thing you'll never have enough of, and that's the moral high ground. You can always take on somebody better than you.
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Sam Parr | hey he's elon's like the sam parr of but just have money | |
Shaan Puri | good episode see you later |