Coaching Our Producer To Make $5000/Hour With Consulting
Unconventional Business, Angel Investing, and Short-Term Rentals - January 25, 2022 (about 3 years ago) • 57:27
Transcript:
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Sam Parr |
I think you should go hard on this. So you have 100,000 listeners a month, you're making single-digit thousands of dollars. You would make like six figures a year for sure doing this, alright?
Good. So Sean, what's good? What's going on?
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Shaan Puri | What's up? What's up? You got Ben still on the line. What do you got for Ben? Normally, you're like, "Man, turn off your video. We need to focus."
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Sam Parr | I'm going to tell you why. So, Ben made a comment to me—maybe to you too. I think you were here a while ago, a month or two months ago, and I've been thinking a lot about it. He kind of made it not a big deal, but it's kind of a big deal to me.
So, Ben, I'm not going to... I haven't told you this, but I'm going to bring this up. I'm only going to mention the thing, and then you can explain how you want to.
Basically, Ben Wilson has this podcast called "How to Take Over the World." You said that a very wealthy person—like a hundred million dollars person—has you on retainer. This person basically tells you the strategy that they are going to use in business, and you tell them stories from history to let them know what you predict will happen. Is that right?
What? Yes, yes, he may... Is that crazy? He didn't explain it that way, but that's exactly what happened.
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Shaan Puri | It's like a sugar daddy, but it's like a history daddy. Do you...?
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Sam Parr | it's not | |
Shaan Puri | like a history baby I guess sugar baby okay | |
Sam Parr | that's true did I get that act did I explain that | |
Ben Wilson | Yeah, so here's the full story. I get a lot of people who reach out to me at this point. Basically, any fan who's like, "Hey, can I talk to you for a little bit?" I'm just like, "Yeah, I'm not that big yet. If you're big enough that you think I'm important enough to want to talk to me, yeah, I'll talk to you."
That's starting to change a little bit; a lot of people want my time now. But this was a while ago, and so I said yes, I'll talk to you. He said, "I'm thinking of starting something, and I want to talk to you about it." I was like, "Okay, this guy's probably a joker, but whatever. He reached out to me, I'll talk to him."
So we hop on a Zoom call, and the first thing I notice is that he's got a glass wall behind him. You can tell he's in a very, very high-rise in New York City; you can see the whole skyline behind him. So immediately, I was like, "This is not what I thought it was going to be."
He said, "Yeah, I'm a managing director at XYZ Bank, one of the biggest banks in the world, and I lead their X division—a very, very big financial division at this big bank." He continued, "I just randomly found your podcast, and you don't know this, but I've been listening to you. You're my guru now, so I want to talk to you about what I'm thinking of starting. I just want to bounce it off you and see what you think about it."
And so, he gets to call me whenever he wants to.
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Sam Parr | well that | |
Shaan Puri | That sounds more normal. Sam was saying he specifically wants you to tell him, based on history, "Here's what's gonna happen." Is that correct?
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Sam Parr | What? That's what you meant? You said that?
Yeah, like I said, I explained it differently, but that's what's going on here. He likes you, and he wants you to tell him, "How would Julius Caesar handle this?" or "How did Julius Caesar handle this?" Tell me, like, what to do.
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Ben Wilson | that's that's basically the angle he's going for yeah because he knows me from how to take over the world so yeah that's | |
Shaan Puri | good then god that is amazing that is | |
Sam Parr | isn't that awesome | |
Shaan Puri | Well, first of all, hopefully me laughing about it doesn't blow this for you. But, wow, that's amazing!
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Sam Parr | But listen, I want to ask you more questions about this, man. I had the same reaction, Sean. I was like, "What? That sounds like a scam."
But I've been thinking a lot about this, and I actually think that's a great idea. I think that is a wonderful idea. What do they say? "History may not repeat itself, but it definitely rhymes."
If you can just tell people what behaviors to avoid or how other people have had the same move and what happened, I think that's great. How much is he paying you?
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Ben Wilson | 0 what 0 | |
Sam Parr | I thought he paid you I thought you were like on retainer no no no no no no | |
Ben Wilson | he's paying me so he so he offered to pay me and I said did | |
Sam Parr | he offer how much did he offer | |
Ben Wilson | well he didn't offer explicitly but he's he said they he said | |
Shaan Puri | he said people | |
Ben Wilson | He said, "People who do what you do, who consult people like me, often make upwards of $5,000 an hour." I don't think he would pay me. I've never done it before, and I'm not like a high-level coach.
But I was like, well, that's a pay range I was not considering, I must admit. He said, "I will pay you," but then I ended up telling him, "No, don't worry about it."
I just think it's better to have the connection and have him think that he owes me at this point.
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Sam Parr | Okay, that's fine. But I actually think that there's something interesting here. Because like, Alex Friedman or these thinker-type folks, they definitely could get paid $5 or $10 an hour.
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Shaan Puri | Yeah, but to me, this is more like when you described it. It's more like, you know, in *Billions* or whatever. It's like the guy's got a kink and he goes to get dominated by some chick in a mask with a whip.
To me, it's more like some rich guy saying, "Hey, I need you to tell me that I'm a huge fuck-up and I suck when I call you. That's going to motivate me to go into this meeting and prove myself."
And I will pay you $2,000 an hour if you are a hot woman who tells me I suck and you spit on the webcam. To me, that's more where the opportunity is than just telling me about lessons from history.
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Sam Parr |
No, this is good because it's like... Let's say that he's like, "I'm working on this thing. My opinion of it is this, this, and this." And Ben goes, "Well, you know, Rothschild... He actually... The reason why they did really well is because they just got information a little bit faster, and they did this business."
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Shaan Puri | and this | |
Sam Parr | the | |
Shaan Puri | Business is so context-dependent. It's not like you actually need the strategies of the Rothschilds or Julius Caesar. I don't think so. I think it's motivational to hear these stories, right? Like, I use one story a lot.
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Sam Parr | why does it matter if it's motivational or if it's like strategically well that's cap actually accurate | |
Shaan Puri | Well, because you gotta know, what am I delivering? Right? What am I actually selling this person? Am I selling them strategies from the 1830s, or am I selling them something more relevant?
For example, Ben, I use this anecdote from "How to Take Over the World," where you talked about how Edison used to be amazing. He had done so much by the age of 25. But he felt behind because Nikola Tesla had already done X, Y, and Z by that age. Even though he was the greatest inventor of our age, he personally felt behind because he was comparing himself to someone else.
Then he read that Julius Caesar used to look at a statue of Alexander the Great and think, "What the heck am I doing with my life? Alexander the Great already ruled the world by now."
To me, that lesson was pretty important. A lot of people feel like they're behind or compare themselves to others who are doing better. It's like, dude, there's no end to that. Julius Caesar used to feel that way too. So, you know, that's a trap. There is no amount where you'll stop feeling that way, so you might as well just let it all go.
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Sam Parr | that's kind of the same thing you're just talking about life strategy I'm I mean it's kinda yeah I agree with you | |
Ben Wilson | I'll tell you how it actually went because what you said, Sean, actually plays into it. He said, "I'm thinking about starting this thing. It's a higher possible outcome, but if I stay where I am right now, it's just more steady."
I can go from whatever, I can go from 220 to 500 hopefully in the next 10 years, but I'm not going to become a billionaire essentially. However, if I go start my own thing, I could lose a lot of money.
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Sam Parr | What does 220 mean? 220,000,000? Oh, that's what he's worth.
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Ben Wilson | No, I'm not going to tell you what he's worth, but it is in the hundreds of millions. | |
Sam Parr | sounded pretty | |
Shaan Puri | specific to me alright go go | |
Sam Parr | sounded like not a made up number alright | |
Ben Wilson | Go ahead. So, he was essentially like, "Should I do this thing?" I tell him, I talk about the concept of exactly what you're saying, Sean.
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Shaan Puri | So much pressure on you to say something that's not stupid. Somewhat pressure.
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Ben Wilson | I was literally, as you're saying this, thinking, "Why the hell are you talking to me?" It was so funny to me. But he loved the podcast; he thought I'd have something interesting to say.
So I was literally just grasping in my head, panicking a little bit, thinking, "What am I going to say to this guy?" I started talking before I even knew what I was going to say. I said, "Okay, well, have you heard of loss aversion?" and I brought up the idea of loss aversion, which I'm sure you guys...
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Sam Parr | have | |
Ben Wilson | you heard of that he hadn't heard of loss aversion so I explained to him a little bit what loss aversion was | |
Shaan Puri | explain it for somebody who's listening who doesn't wanna go look | |
Ben Wilson | At it, so loss aversion is the idea that you value not losing your money more than you value gaining money. You put more emphasis on it.
So, I essentially said you need to make loss aversion work for you. If you believe that you're going to be successful, then you need to visualize that success.
Say to yourself and realize every day that delaying the start of your new venture is costing you billions. You're losing $1,000,000 because you're failing to act.
He was like, "That was amazing! That's changed my whole perspective." He was blown away.
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Shaan Puri | that's why they felt really good about my spend | |
Sam Parr | Yeah, Ben, I think that you're doing something that's really common, which is something I do too. You... Sean does not do this. You are putting too low a value on your plan. Yeah, let me... | |
Ben Wilson | Let me tell you how it ends. So, it was like a month later, and I was in New York City. I said, "Let's meet up, let's get lunch." We went to a really nice restaurant, and he bought me lunch, which was very nice.
I was like, "So, when are you starting the thing?" And he's like, "Well, I'm not actually doing it." He gave his reasons why he's not starting it yet. I was like, "Okay, well, it sounded good when it came out of my mouth." Apparently, my advice was not that valuable. You spit and squatter.
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Shaan Puri | Drinkish, exactly! That's what you need to go dominatrix, dude. It's a yin and yang, good cop, bad cop sort of thing. | |
Sam Parr | I think by the way I think that | |
Shaan Puri | Loss aversion is a concept where the numbers are roughly 2 to 1. This means you would have to make $2 to feel the same emotional impact as losing $1. In other words, you would need to make $2,000 to feel the same level of emotional hit as losing $1,000. I don't know if that's accurate, but I've read that this is the ratio of how much we value loss more than gain. Sean, do you agree?
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Sam Parr | you get asked to consult and like do this type of stuff | |
Shaan Puri | I get asked... I never consult anymore, but I basically run a simple filter: **Would I do this for free?** That doesn't mean I'm going to do it for free; it's **would I do this for free?**
So, for Ben, in Ben's case, he's like, "Oh, this sounds like a super interesting guy." I'm... and he...
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Sam Parr | did do it for free | |
Shaan Puri | I'm going to learn as much from this guy as he's going to learn from me, if not more. So, you know, I'm happy to do this with my time.
That's one thing.
And then the second part is, dude, you get paid crazy money for doing this type of stuff. Like, Sam, you do these GLG calls. Have you done any of these?
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Sam Parr | I I I used to I think I was getting paid $1,000 an hour | |
Shaan Puri | yeah exactly I set my rate at the max that they let out | |
Sam Parr | let you do | |
Shaan Puri | which is now 2,000 | |
Sam Parr | 1,000 it's 2,000 that's what it was | |
Shaan Puri | And, dude, I'll get paid $2,000 to just do like a 40-minute call with some random person.
First of all, it's kind of funny because it's like this weird underground dominatrix stuff where I'm a hedge fund manager. I can't tell you the fund, I can't tell you what I'm looking at, I can't tell you my name.
But it's like a one-way transaction. It's like I'm the masseuse and they're laying face down; I can't see who they are.
Then they're like, "Okay, say the word metaverse," and I'm like, "Metaverse."
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Sam Parr | and then like tell | |
Shaan Puri | Me: "Tell me, who's gonna... which stock's gonna go up because of the metaverse?" I'm like, "Dude, I don't fucking know." And they're like, "What?" And I'm like, "Yeah, but I could tell you, you know, here's some things I think."
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Sam Parr | well well whenever I do those things I talk really slow | |
Shaan Puri | yeah because you just do | |
Sam Parr | It in the matrix to pass. Yeah, you... I always talk really slow and I'd be like, "Wait, hang on, let me get my headphones."
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Shaan Puri | Yeah, there's a better way. I can't talk slowly; it's like I'm too nervous. Like I said with Ben, you feel a tremendous amount of pressure. It doesn't really matter how much money you have when somebody's paying you something.
I would never pay someone $2 for a phone call, even though I'm sure there's an economic case where it makes sense. It's just a big number to me to pay for somebody to talk to me. I'm so not used to it that when I'm on the other side and getting paid, I'm like, "I need to deliver this guy some insane insight."
I put this weird pressure on myself that just is unachievable. I'll say my idea, and I really only have one. Then I'll say, "Another way of thinking about it is..." and then I'll repackage the same idea with a metaphor or an analogy just to fill air space.
In reality, it's one idea that's worth it for them or not, and I don't have ten amazing ideas. I have one around one topic, you know? I don't have... | |
Sam Parr | But there, there's a... that's why Ben's schtick is amazing. Because Sean, you can only consult on your life experience, and you can't live that interesting of a life all the time. Whereas Ben can just steal... he can just read a book a week, and he's going to have like, you know, 52 new ideas a year. | |
Ben Wilson | The thing that this guy was trying to sell me on was that I should come up and speak to his bank. He's like, "You could get paid like easy $50 a pop to come up and give these speeches."
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Shaan Puri | And I do $10 for Zoom at home to give a speech to somebody now.
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Sam Parr | how many of those people like why | |
Shaan Puri | Am I not doubling my price? If they're not saying no to this, I need to basically adjust my pricing strategy. If half the people aren't saying no, then I'm priced way too low. Right now, everybody's saying yes, so why not price it double that?
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Sam Parr | I did one recently. It was $25,000, but it was in person. Yeah, yeah. How many of those Zooms... how many Zooms a month do you do?
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Shaan Puri | do not not even 1 a month 1 every 2 months probably is the the current | |
Sam Parr | that's pretty sick to me though | |
Shaan Puri | Yeah, oh, it's great. I mean, it's great money because there's this other thing, Ben. I don't know what the history or psychology will tell us about this, but there's extra joy in making money when you can assign what that money gets to go to.
Versus just generally making money and it's going to go into a general pot of a bank account. Versus like, "Oh, $10." Alright, if I'm like, "Oh, I do these two speeches this week, this month, I'll go buy that car," or "I'll go get my wife this gift," and she's like, "Wow, that's great! This work you did was awesome."
I don't know what the name for that metaphor is, but I abuse the shit out of that.
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Sam Parr | consumerism just consumerism | |
Ben Wilson | So, you guys can tell me if there's ever a moment where, like, the reason I'm not doing any of this stuff is I just feel fraudulent, like going up there and... | |
Sam Parr | that's normal | |
Ben Wilson | but but yeah maybe I just need to get over it I don't know | |
Shaan Puri | 100% you need to get over it. The way you should think about things is that most of your life, you're basically underpaid and underappreciated.
The universe has its way of evening itself out. For example, Sam will make more money off of some random investment he thought about for 5 minutes than he would have grinding away at his apartment rental finder business for 2 or 3 years.
So, you know, the inputs don't always match the outputs in life. Once you sort of acknowledge that and accept it, that's the first thing you have to recognize. The level of difficulty for me is not what dictates the value for somebody else. So that's number one.
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Sam Parr | yeah the the the the effort is not in proportion to the output | |
Shaan Puri | It's irrelevant. All that matters is the output. The fact that you know input is a liability for you is a weird psychological liability. You would be better off not knowing how hard it was to say that one thing to that guy at that moment.
The second thing is that, you know, Mr. Market will decide what it's worth. You might get lucky once; you might get lucky twice. But if people consistently pay you for something, it's because that's what it's worth to them. If not, it's worth... if not being worth more, right? They need a positive ROI on that interaction.
So just let the market decide. The market, over time, will balance itself out. Maybe one off... yeah, that was just a fluke. But if it happens consistently enough, and you should just expect it to happen consistently, then it works. | |
Sam Parr | I think you should lean into this hard. How much money are you making on ads for your... let's say, say the numbers. Can you say the number? Do you want to do it or no?
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Ben Wilson | yeah because I have one sponsor right now | |
Sam Parr | it's cold punch cold punch | |
Ben Wilson | shout out cold cold punch go to the cold punch | |
Sam Parr | dot com sam | |
Shaan Puri | sam is the one carrying that sponsorship | |
Ben Wilson | Use code "Ben Wilson" for, I don't remember how much off, $150 off something like that.
So, I will say I'm making low four digits per month.
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Sam Parr | okay so 1 to 5000 a month correct | |
Shaan Puri | By the way, also the hack when somebody says how many digits is to just take the bottom three numbers of that range.
So if I say I make 7 figures, I'm saying $1 to $3,000,000. If sales is, "We sold for 8 figures," it's $10 to $30,000,000.
If somebody's... hey, right? Like nobody, if you're over half, you usually say it differently. Once you cross over $50,000,000, you would say "over $50,000,000," not "8 figures."
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Sam Parr | Or like the figures can include the dot zero. Yeah, there you go. That's a figure nine figure exit, bro.
So I think you should go and do this, Ben. I think you should include... I think you should go hard on this.
You have 100,000 listeners a month and you're making single-digit thousands of dollars. You would make like six figures a year for sure. You should do it.
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Shaan Puri | Your own ad rate basically says, "Look, yes, you listen to this." People who listen to this tell me they got a bunch of inspiration. They got some strategies, and they filled in the gaps of something they didn't know about history. They can see their place in the world today through that.
Like, what I... blah blah blah, some bullshit. You basically say, "I used to run ads for cold plunges. By the way, use code Ben Wilson at checkout if you want."
But, you know, actually what ended up happening is that companies started hiring me to come in and talk to them about lessons from the greatest figures in history. It's motivational for the executive team and a great addition to any off-site.
So, that actually ends up making me more money than the ads. If you're interested in that, you should contact me. I bet if you do that, you'll get one of these a month, and it will quadruple your current ad revenue for the month.
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Sam Parr | dude you gotta do this man you gotta do this | |
Ben Wilson | Okay, next month we'll do another segment in Ben's first $1,000,000.
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Sam Parr | See the outcome. You can make it as simple as this: My best friend, Neville Madora, has these things that he calls "consults." If you go to his blog at copywritingcourse.com/likeconsult, there's just a checkout page. It's $1,000, and you book one hour with him. You pay, and then you just select a time on Calendly.
Every Tuesday and Thursday from 9 AM to 1 PM, he knows that he does those calls. He makes a lot of money from it each year. You could do it as simple as that. | |
Shaan Puri | The other thing, by the way, is that you need to do a profile on how to take over the world. I think you know you've done jobs, but I think if you do something like Pixar, right? You could say, "Here's Pixar's kind of creativity process, how Pixar consistently has creative hits in storytelling," or something like that.
That opens the door for you to basically teach the Pixar way to a bunch of companies that want to be better at being creative, or storytellers, or whatever. You could replace Pixar with any company that's excellent in a specific category.
Then, you just tell your story as you always do, and that becomes part of your slightly more corporate repertoire. You know, maybe they don't want to hear the Putin story, but they want to hear the Pixar one.
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Sam Parr | Yeah, so you select the people by who will listen to this and then pay me money to consult.
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Shaan Puri | talk to them from that | |
Ben Wilson | Yeah, I'm gonna go to Apple and give them the Putin speech. Then, all of a sudden, Google employees start mysteriously dying.
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Sam Parr | I think this is good. Right now, you're slumming it because you've got a small business that you're just starting, and it's going to take time to get going. This will just supercharge it a little bit, I think.
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Shaan Puri | And by the way, whenever I give advice, the way I explain it to people is: I'm going to say some things that might make you feel uncomfortable.
This could be either because you personally would feel nervous saying the things I just sent to a customer or quoting a price to a customer.
The second reason is that your moral code says, "Well, that's not what I want to do with my content. I don't want to feature Pixar because I want to give talks about creativity and storytelling."
Okay, cool. I'm just telling you, if you crank the commercialization, like the "sell-out" knob, to 12, here's what you could do. Then you could decide to dial that back to 9 or 8, whatever you feel comfortable with.
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Sam Parr | Would you say it differently? I say, "Do you want your future kids to have braces or not? Get to work!" It's like, have you ever been to an orthodontist, my friend? It's expensive. Get to work!
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Shaan Puri | It's amazing! It's too good. Alright, let's do some other topics. Thank you, Ben. I appreciate that.
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Sam Parr | ben good luck I I do appreciate | |
Ben Wilson | the advice I I really do thanks guys | |
Sam Parr | that's amazing right that that I was thinking about that for like about a week now | |
Shaan Puri | that's hilarious I had no idea that was going on alright | |
Sam Parr | He mentioned it to us, but he didn't make a big deal out of it.
What do you want to talk about?
I want to talk. Okay, I know what I want to talk about.
Well, I don't know if this is interesting to you, but I've noticed that your angel investing is on a tear. Our friend Sully just said, "Whatever, Sean." What did he say? "Whatever, Sean."
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Shaan Puri | A joke. He was like, "Oh, I got this new brilliant investment strategy." Sean invests in something, and then he tells me about it 2 weeks to 2 months later. Then I pay 10 times the price for the same item from the same company. Yeah.
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Sam Parr | it was great | |
Shaan Puri | Which is... and he's like, "Anecdote." He was joking, obviously. That's not great. He's making fun of himself because that's literally what's happened in like, I think, 6 or 8 deals now.
I'll even tell him about it, but he just delays responding for a couple of weeks. Or I forget to tell him, and I tell him, or he tells me about the company a few months later. I'm like, "Oh yeah, I invested in that."
He's like, "Awesome! Can you make an intro?" I make the intro, but the price has gone up dramatically because the company has more traction or more whatever. So that's what he was joking about.
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Sam Parr | so I we I put you on like an email list for my friends where I'm sending you everything are you getting those | |
Shaan Puri | no I didn't see anything | |
Sam Parr | I sent you 2 of them so far | |
Shaan Puri | okay maybe I need to | |
Sam Parr |
To... I'll forward it to them. One of them I'll send to you after this. But anyway, so I'm starting it off where I'm sending them to you. So you gotta... hopefully if you find something that interests me, you'll send back. Yeah, but how are you getting such good shit?
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Shaan Puri | I don't know, like, dude, it's amazing. So I feel like there's... I think the easy answer is cool. I do this podcast, and because of this podcast, people come inbound.
The bigger this podcast gets, the more people want you to invest. There's this great thing my buddy Vishal taught me, which is that startups are the only asset class. Real estate doesn't work this way; the stock market doesn't either. In real estate, if you want to buy it, you go buy it. If you want stock, you go buy it.
Startups are the only thing where even if you want in, you don't just get in. The security selects you; the asset selects you just as much as you're selecting the asset. That one insight is pretty important. It basically means you need to build your brand and your reputation so that people want you in deals.
The best deals are all super competitive to get into, and you want people, when they're first thinking of an idea, to reach out to you because they know... Oh, you know, like, for example, I did a great deal recently, and it's so funny. You're gonna hate this; it's gonna piss you off so much. You've been talking about short-term rentals. Somebody came to me with a short-term rental startup idea because they thought I was you or something, or somebody who was like, "Hey..."
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Sam Parr | bro why didn't you send that | |
Shaan Puri | To me, well, the subject line that she reached out with was "Last One." It was like, "Hey, I have the smallest bit of allocation left in this."
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Sam Parr | mother of god | |
Shaan Puri | It's this company called **Hostfully**. You'll love it because it's literally exactly what you're doing. You should get in; I'll enter you. You will get in.
Basically, what they're doing is, if you own a bunch of Airbnbs, which is kind of like a new market, it's basically like you're a property manager. So, you're more than just renting out your home or one home; you have multiple properties. But you're not a traditional property manager who owns a multifamily building of like 32 units.
This is for people who run multiple Airbnbs, and it just makes your life way easier as the owner of that. They have a few million dollars in recurring revenue, the valuation was great, and the founder was really impressive.
So, I was like, "Oh yeah, great SaaS software for people who manage multiple vacation rentals." And then you're over here building **Short Sam**, a short-term rental club, building this community, doing this thing. I got the benefit because people thought I was you.
That's one answer—the "piss you off" answer.
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Sam Parr | that's ridiculous that is the piss me off answer whatever it is what it is send me the | |
Ben Wilson | what I'll | |
Shaan Puri | send you | |
Sam Parr | that what's the company called fully | |
Shaan Puri | can we | |
Sam Parr | talk about it | |
Shaan Puri | yeah hostfully | |
Sam Parr | Hostfully. Yeah, well then I can just email her. Do they have a bunch of VCs behind it or are they all angels?
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Shaan Puri | I think this rounds up a lot of individuals. I'm not sure; it was like I was kind of late to the party. So, I was just pretty quick to be like, "Okay, this makes a lot of sense."
You know, the rent—once you have revenue and a few million dollars that's recurring—and they really haven't even figured out what their marketing strategy is going to be yet, it's like, "Okay, that's a pretty good signal that this is going to work." It's a pretty indispensable tool for a property owner, so I like that one.
But I would say, okay, here are some of the things that have happened. One is when I share deals with you, you share deals with me. My buddy Julian Chapiro shares some of the best deals. He's just very active; he's very consistent with it. Meaning, like, every week he's sending me some good stuff.
That's, I would say, 40 to 50% of the portfolio is relationships with friends who themselves are experts, specifically people who are experts in one niche. So, it's like we've been doing a bunch of salesperson software, and it's because we have a relationship with Kraft Ventures, which was started by David Sacks. He's kind of like the enterprise SaaS guy; he built Yammer and sold it for $1 billion. His fund specifically just focuses on SaaS companies.
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Sam Parr | what you're you you talked to so david sends you stuff | |
Shaan Puri | David, not me particularly. My partner Ramin, who runs my fund, basically has a good relationship with somebody at Craft. For example, when they're seeing something good, they're just trading notes all the time. So, we're getting to get in on a lot of their deals. So, even if... | |
Sam Parr | They don't have any issues being... but do they... are they giving you the deal because they like Sean or they like Ramin?
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Shaan Puri | In this case, it's Ramin because he has that relationship. He's catching up with that guy every two weeks, going to get coffee or whatever it is.
But then I do the same with my guys, right? I do the same with the people in India or the people in Southeast Asia because I think that's where a lot of opportunity is and that's where I have the right relationships. So we're sharing stuff just amongst that.
The other thing is themes. For example, once I decide that a theme is correct—worth betting on—what I learned from Sully is the level of aggression you need to have. Once you decide that X is a good idea, you need to go invest in that company and then in the five other companies that are adjacent to it.
For example, there's this trend of banking, like neobanks. This started several years ago where people basically said, "Look, banks are something everybody uses but have super low customer satisfaction scores. Their apps sucked, their marketing sucked." So basically, people were like, "Look, we can create a digital-first bank." This started with New Bank, which is probably the best example of this. It's in Brazil, and they're like, "Oh, look..."
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Sam Parr | yeah and they're about to go public | |
Shaan Puri | Underbanked, there. So, they started a new bank. A friend of a friend of mine led their investment, and now it's a $10,000,000,000 company. It has millions of customers in Brazil.
Then the same thing happened in the UK with Revolut and Monzo or whatever. So, this idea of neo banking basically revolves around creating a super slick app for customers. You digitally market to acquire customers, and essentially, you're not building the banking part. You usually partner with a bank like BBVA or something like that. Under the hood, it's BBVA, but the customer relationship is with a company that's really good at taking care of customers and building good user experiences.
Anyway, the short answer is to decide that this is a good idea, and that takes many forms. We talked about this before, like Ramp or Brex. Brex, I think, was the fastest growing YC company in the last few years. You look at it and ask, "Is this a good idea?" Well, what are they actually doing? They're basically giving credit cards to a group of people that were dissatisfied with current credit card providers.
Brex did it for startups, and they get a portion every time that card swipes. Oh, interesting! So, if a million people are spending $1,000 a year on it, and they're keeping 1.3% of the interchange fee of the debit card or whatever, you can come up with some number and say, "Wow, this company's going to get big pretty fast."
So, we did that math of neobanks: how much is a neobank customer worth, and how much is a credit card customer worth? Then we went and did it in every niche we could think of. We invested in Keep, which is doing this for Canada, and then we invested in Pluto, which is doing this in the Middle East. | |
Sam Parr | but but did you holler at them | |
Shaan Puri | Yeah, then we go search and destroy. Basically, it's like how do you go hunt for the best companies that are doing this in either this geography or with this customer base? So, for example...
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Sam Parr | and you just dm them on twitter probably | |
Shaan Puri | Yeah, exactly. We just reach out, cold DM, and say, "Hey, I'm a believer in this for this, this, and this reason. What you're doing looks super interesting. I would love to invest."
Sometimes it comes inbound. Sometimes it's, "Oh, you got a hundred things inbound," but you know what you're looking for. So you quickly pounce on the four that fit your thing.
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Sam Parr | aren't you out of money at this. From the fund though | |
Shaan Puri | I raised more money because I was thinking, "Will I get $1,000,000 worth of deals every quarter that are good deals?" I'm not just trying to invest in crap, so I need to invest in good deals.
I was unsure how many high-quality deals I would have. Now, I realize that whatever I had before was too low. So now, we're doing almost $2,000,000 a quarter. We raised more money because we just had better deals.
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Sam Parr | Man, I... because I'm starting. So, I started angel investing almost a year ago. Well, I did it with 5 or 8 companies in the last... before that, I forget. A couple of them have turned out to be meaningful, like turning $20 into $300, $400,000. And I'm like...
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Shaan Puri | holy shit | |
Sam Parr | This is how it works. But, like, it sucks for a while, right? Because you just invest, and you're like, "Well, that money's gone." You don't ever hear about them, and then you're like, "Oh, nice, it works."
In some of those cases, those are huge markups. In other cases, I'm just now experiencing like 2x, 3x, and 4x markups, and I'm like, "That's awesome!"
What would happen if I had invested in this company at a $10,000,000 valuation instead of a $50,000,000 valuation? That would have been wild! How do I do that?
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Shaan Puri | One of the reasons I hated startup investing for a while was because I was like, "Is this the best use of time and money?"
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Sam Parr | dude it feels like a an expensive hobby I'm just spending money and not getting anything in return yeah | |
Shaan Puri | And then I realized two things. Bezos has this quote, which I believe goes: "One of the biggest competitive advantages you can have is being long-term oriented."
Basically, if you prioritize a 10-year view, where you're like, "Okay, I'm going to maximize what I can do in 10 years," and the other guy is trying to make the most they can for their quarterly earnings call, right? This is how Amazon worked. Amazon was basically like, "We're willing to lose money to invest so that we provide two-day shipping instead of seven-day shipping, or free two-day shipping, or a larger selection."
But it's going to cost us more because we're going to have more inventory or whatever. So, we're going to go into all these other verticals: books, CDs, whatever. They basically said his strategy was long-term. This is going to be the most valuable strategy.
Short-term, we're going to get punished by the market because our quarterly earnings are not going to look great. But that turned out to be the magic, you know, the biggest competitive advantage Amazon had was their ability to be long-term oriented.
I think this is true just in general. If you're competing against somebody who needs a result in one year and you're willing to be patient and get the result in five years, seven years, or ten years, you can make bets that they can't make. This means you get to have lower-priced bets that will pay off bigger over a longer time horizon.
So, I think if you have the luxury of a long-term horizon, that's a competitive advantage. That's how startup investing works. If you need money or you need to see positive growth in one year, startup investing sucks. If you're willing to play a ten-year game, this could be an awesome game to play.
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Sam Parr | You think that... well, do you think? You told me, "Man, I think I could 3.5x my fund," because that's average. Now it seems like it's going to be significantly more.
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Shaan Puri | Yeah, like, you know, you think about kind of like what's the floor. I think a 3.5x would be a solid outcome, but nothing to write home about.
With a small fund like ours, you could see things where you can get a 15x or even a 20x. There are literally crypto small funds like ours that have had a 100x return. They 100x the fund in a short amount of time, right? So, you know, you shouldn't really underestimate it. The ceiling is high, but the floor is pretty reasonable.
The first thing is, okay, being long-term oriented is a competitive advantage. I like sharp investing for that reason. The second one is, you want to do things that compound.
For example, if I wanted to beat the market in the stock market, right? I want to beat the S&P 500. I need to have proprietary intelligence; I need to be smarter than anybody else about something. I think just being smarter at a game where money's on the line is really hard to do.
Whereas, if you basically say, "Hey, my advantage comes from my reputation or my network of people that I know," that's just going to compound every year. The more deals I share with you, the more deals you're going to share with me. The more companies I have that are winners, that's going to make it easier for me to get into the next winner or for founders to reach out to me because they'll say, "Oh, I saw you did these five Indian unicorns. I'm in India; I want to be the next one of them. Can you invest in me?"
So, compounding also comes into play here in a way that doesn't happen in the stock market and doesn't even really happen in real estate. Real estate has it to an extent, but not in the same way as how fast your reputation can compound and start investing.
So, anyway, those are my two reasons why I now actually view startup investing as a game worth playing because it uses two of the superpowers that I believe in and that I think most people undervalue.
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Sam Parr | is it gonna what do you think will earn more the ecom thing or this angel investing thing | |
Shaan Puri | Probably for me personally, the e-commerce thing is significant because I own the majority of that company. So, you know, if it sells for $50,000,000 or $100,000,000, I'll own the majority of it.
Whereas with startup investing, my fund invests $100,000, and we own 0.8% of this startup. I personally have 20% of the carry, but then I share with Ramin, Ben, and Zach. So, I personally own about 5.14% of the carry or whatever.
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Sam Parr | sure sure sure | |
Shaan Puri | So, it's not like you're owning a slice of a slice of something big versus just owning the... you know how it is. Owning the majority of something that sells for a decent chunk is just better financially.
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Sam Parr | It's so much better. And yeah, I think that whenever people raise money, I'm like, "Are you sure, man? You might be able to sell us for $50,000,000 and you'll make more money than if you raise money and sell it for $500."
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Shaan Puri | Yeah, exactly. Now, you know, I have to operate that other business. Whereas startup investing is like, you know, a joy. You just read about cool ideas, you meet awesome founders, and you say yes. You write the check, and then they go do the hard work. So it's a, you know, just a different thing. | |
Sam Parr | Can I... so you brought up SDRs, short-term rentals. That's what they're called: short-term rental SDRs. Have you researched that at all?
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Shaan Puri | so I joined your club but it's fucking crazy right | |
Sam Parr | did you like do you just review it | |
Shaan Puri | I was I'm I've been looking at some of these posts | |
Sam Parr | And I've seen some of them. See, like, it's like techie guys. It's like people who have a $100,000,000 company by the...
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Shaan Puri | way I don't know how you are | |
Sam Parr | founder | |
Shaan Puri | Every time I open Facebook, whatever you're working on is always the top post on my feed. I don't know if Facebook just knows that I love you, but if it was trans... no, it's always trans. If it's Sam talking about his cold plunge, it's Sam's video of his cold plunge naked at the top. You know, what hits in the Facebook algorithm in a way that I don't understand.
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Sam Parr | I've always been like that. It's always been that way for some reason. I mastered Facebook, and that sucks because it's the least valuable.
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Shaan Puri | dude it's the most valuable dude it's the most valuable I figured | |
Sam Parr | it out what you're talking about | |
Shaan Puri | well I only have to stand up chat what or you've only have to turn well | |
Sam Parr | I can only have I can only have 5,000 friends on facebook yeah there's a max | |
Shaan Puri | your groups are big okay so but tell me but that | |
Sam Parr | group is sick right how many people are there a 1000 | |
Shaan Puri | A thousand people in this group are basically posting, "Hey guys, here are the properties I own," and they show a bunch of cool photos.
My strategy, for example, is that my family owns five big short-term rentals in Kissimmee, Florida, which is five miles from Disney World. So, my strategy is basically Airbnb near Disney World. I have a full-time job, I'm a PhD student... blah, blah, blah.
Then, they're showing these Disney-themed rentals that they have, and people go ask questions in the comments. Everyone's got this, like, you know, you're doing your magic thing where everybody feels comfortable just telling you how much money they're making. Everyone's sharing a bunch of good info.
So, I think that's really cool. What I wanted to hear from you is: give me the top two most interesting stories that you've learned out of this.
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Sam Parr | Tell you, I’ve gotta be a little subliminal about this. So, in that group, there are 11, or 100, or 1,000 people. I met one person that’s got $35,000,000 in homes. He owns about 20 of them and he’s currently making about $1,000,000 a month in profit.
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Shaan Puri | And was this person wealthy before this? How do you get to the $35,000,000 worth of real estate?
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Sam Parr | They were mildly wealthy; they were worth probably **$15,000,000**. They had a business that they sold. Yes, they were not poor, right? They invested a lot of it into short-term rentals, and now they have a staff of a couple of people who are full-time. His take is like **$800** a month.
I met another guy who worked at a hedge fund. His name's Richard. If you Google Richard, he'll tell you he has a story in there. He eventually quit his hedge fund, and now he owns **$50,000,000** worth of short-term rentals.
The themes that I'm seeing are these:
1. Institutional capital has not come into short-term rentals in a significant amount.
2. The numbers might be inflated because the economy is crushing, but I'm not entirely sure if that is totally the case. It definitely could be the case.
3. A couple of years ago, people were just buying places without doing much math, and the math worked out. They were making **25%** returns, and it's crazy.
Now, it's a little bit more challenging, but there's still a lot of opportunity. It's sick, man! I've been learning all about it; it's wild. | |
Shaan Puri | So, all of the things you've read in here, what seemed like the smartest, what I'll call a "small ball" strategy?
Throw out the guy who's had $15,000,000 and now has built this big thing. Who's done a small ball start, small grow, grow it, and maybe in some niche. That's a cool story out of this.
Or you don't say who, but what do they do?
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Sam Parr | Is $1,000,000 considered small? So, if you buy a property for $1,000,000, you're going to put down $150,000 for some of these guys.
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Shaan Puri | that that's true | |
Sam Parr | Guy in there? Yeah, if you go, are you in the group right now? Search the word "coconut." There's a guy who bought a plot of land on a coconut farm in Mexico. He put four, I think, tiny homes, and he rents them for $150 a day in Mexico. He did really nice landscaping, but not complicated stuff. It looks beautiful. Do you see it?
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Shaan Puri | Is it Safa Farms? Yeah, can I say the name or no? Safa Farms? Yeah, yeah, yeah, Safa Farms.
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Sam Parr | so click it | |
Shaan Puri | so 6 cabins | |
Sam Parr | created this like | |
Shaan Puri | So, it says a tiny eco hotel/farm with 6 cabins and 1 house, an in-ground fire pit, and a pool in Mexico. It looks cool!
It's basically a bunch of wooden cabins that look like really small accommodations for 1 or 2 people. There’s a really cool outdoor area with hammocks, pools, and common areas. You can also find places to do yoga, with chickens running around you.
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Sam Parr | Is that wild? He talked about it in the post. I don't think he spent a significant amount of money to set that up, but it's minimalist-ish. It's kind of nice, but it's definitely minimalist. It's lovely.
So, that's a really cool thing. I've seen a guy like that; that is really interesting. What they do is they go and stay there a couple of weeks out of the year.
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Shaan Puri | Dude, how cool is Airbnb? It created this opportunity for anybody to say, "Hey, look! If you can create an awesome experience for people, like a great place to stay or a unique place to stay, we will give you money."
You will be able to make money just by creating this cool little farm and huts set up in Villa Corona, Mexico. How sick is that?
And then on the other side, it's like, "Hey, you want to travel?" Here's the buffet of dope experiences that are not just cookie-cutter hotels that you can go stay at.
How sick is Airbnb? That's just respect.
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Sam Parr | It's amazing, you know? It's amazing. What I'm learning is that the order of importance is crucial when you're looking for something. It's just like content; it's just like scrolling through YouTube.
If you look at it through that lens, you can make a lot of money. For example, when you're buying a property, you go on Zillow and look at their thumbnail pictures. You're like, "What catches my eye?" If you don't see anything there, you're like, "Alright, nothing here." But then you might think, "Oh, they took a bad picture here. If they changed the angle and made the light at sunset, this would look beautiful."
So, you're basically shopping for thumbnails. The second thing you want to do is avoid shopping in any place where you have to create demand. You can use AirDNA, which shows you who has the highest booking rate.
The third thing you do is pick a very specific niche and have one unique thing about the property. For example, you could call it a "zen" property because you have a little pond on the premises.
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Shaan Puri | the front | |
Sam Parr | Or what I'm going to do is call it like it has a fancy gym, or it has a putt-putt course, or it has one unique thing.
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Shaan Puri | right right right | |
Sam Parr | Like a deck with a view of the sunset, you want that one unique thing. That's the same way how content works.
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Shaan Puri | Because it lets you reimagine. Okay, if this home was not for a family of four to live every day, go to the grocery store, and come home, then maybe this little space, instead of being a living room with just two couches and a TV, could actually be where companies come for their retreats.
It's actually going to be different groups of 25 at a time. They need a big sauna in one area, and then they need a pool area with a barbecue pit. I will overinvest in these things, and I don't need to have these daily utility functional things that a normal house would need.
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Sam Parr | Right, and it's just been so fascinating because I didn't realize how many tech nerds are into this stuff. That group is so cool; it's so interesting.
Anyway, we can move on, but I thought that was just an interesting world that I'm falling into.
So, like, you know Rohan from Priceonomics? He basically didn't tell me this, but it appears as though Priceonomics is on the back burner, and all of his time is on short-term rentals. He owns like seven of them. It's badass, man! It's a super interesting market.
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Shaan Puri | Yeah, I just want to give money to this group and just be like, "Hey, you know anybody who wants to trick out their place or buy their next property? Hey, I'll just finance it with you and share cash flow." If you want to, you can have some preferred return; that's fine.
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Sam Parr | So, that is the thing that's interesting to me. There's no such thing, or there aren't many funds.
You and I have invested—I think you did as well—in a BlackRock investment fund that buys like 500 Walgreens, and they just make 5%.
There should be one of those for short-term rentals. Just because if you believe in that category, you can have a REIT or skin in the game somehow. That's passive.
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Shaan Puri | Right, yeah, that's wild. Okay, let's do one other thing. Let's see, I got a couple. Let me give you... let's do two quick ones.
Okay, tailgate guys. Have you ever heard of this business?
No? So this came up at PharmCon. I go to this dinner with this guy who listens to the podcast, and he was telling me... I was like, you know, I was trying to make small talk at this dinner. I was like, okay, I hate normal small talk. Like, I'm not gonna say, "Oh yeah, how's the conference going?" "Good." "Yeah, good. How about you?" "Good, good."
And I also don't know anything about farming, so like, it's not relevant to me. So, you know, okay, I can ask them a bunch of questions.
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Sam Parr | Oh, you like corn too? Yeah, exactly. No, I don't have much to add there. So, what's your favorite type of corn?
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Shaan Puri | So, I was a bit of an icebreaker. I was like, "What's your first job?" I went around the table asking, "Did you have a side hustle in college?" Everybody was doing something different now, and they were all established, but I wanted to know if they had a side hustle when they were in college. Everyone had an interesting one, so I put that in my question bank as a fun little conversation starter for when you're in an entrepreneurial group.
One guy tells a story. He goes, "Yeah, dude, I think he went to Ole Miss or one of the Alabama schools, like one of these southern football colleges." He said, "I created a tailgate in a box." I was like, "What?" He explained that tailgating is huge before football games. People go to the parking lot, and they want to grill, drink, and play beer pong.
He said, "My family used to like to do it, and it was so competitive that you had to wait overnight to get your spot." He would have to go down to the, I forgot what it's called, the Grove or something like that, and hold his family's spot. Then he started to think, "Okay, cool, you got the spot, but you need to set up the tailgate for us. We need tables for beer pong and all this stuff."
So, he said, "Okay, I'll get the stuff every week and set it up." He created a good setup, and then the space next to him was like, "Hey dude, can we just pay you to set ours up next week?" He said, "Alright, give me $200, and I'll get you guys some stuff." They agreed, and then the price went up. He realized he could charge each little tailgating group $500 to set up a cool tailgate spot for them—turnkey tailgating.
He did this at his college and said, "Dude, I was making thousands of dollars every semester running this." I was like, "Wow!" | |
Sam Parr | is it I googled tailgate guys did it get acquired | |
Shaan Puri |
So that was their competitor. There was a nationwide version of this. He was doing this at a small scale; that was his college side hustle just to make a little bit of money. He's like, "Yeah, Tailgate Guys tried to come in, but they couldn't break into our market. We owned our market."
I was like, "Who's Tailgate Guys?"
He's like, "Oh, these guys basically took this idea and they started doing it nationwide."
And I was like, "That's really smart."
He goes, "Yeah."
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Sam Parr | But how does it work? Do you just hire college kids and say, "We'll give you $50.50 an hour for 3 hours on Saturday. We get 50, you get 50"?
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Shaan Puri | exactly | |
Sam Parr | and then do they do the kids go to like walmart and buy the stuff | |
Shaan Puri | I think either you give them the supplies in bulk or they have to go grab it. You tell them, "Hey, you need to get this table, these balls, and this beer," whatever.
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Sam Parr | use like a company credit card or something that | |
Shaan Puri | Has exactly... and yeah, so the tailgate guy, and what they do, the key is they would partner with the school. They would say, "Hey, we'd like to be the exclusive tailgate provider for the school," and the school would give them the license.
So they had a monopoly, and I was like, "Wow!" It's like, yeah, actually this is pretty common. Schools will basically pick one vendor provider. They'll sell the license rights, basically letting you become the official, you know, North Carolina... you know, the Tar Heel tailgate.
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Sam Parr | and they link to you and stuff | |
Ben Wilson | and you | |
Shaan Puri | Call it **Tar Heel Tailgate**. It's like their thing. You pay them a fee or a revenue share of what's going on, but in exchange, you get a monopoly. You get to be the only provider of this service, and it's like super viral, right? Because everybody sees, "Wow, that setup looks not bootleg. What is that? Oh, they use Tailgate Guys or whatever. Okay, cool. We should use them next time."
So, Tailgate Guys apparently got bought out by private equity or something, but they were doing like $30 to $50 million a year doing this. What? I thought, "What a great example of a college hustle that you then scale up." You say, "Alright, if this works at my college, it's going to work at every college that has a football program and tailgating."
Then we have this repeatable sales model of going to the university and telling them, "Hey, these other eight universities partner with us. We'd like to partner with you. You get extra income, and we will provide a safe, convenient way for your fans to do this." I thought that's pretty much a really cool little niche business.
Then I started thinking, "What are the other businesses that use the same sales tactic of basically partnering with the school and becoming the exclusive provider?" So, we had a little mini brainstorm session at dinner. The guy listens to the podcast, so he said, "Dude, this is happening also with scooters."
When Bird and Lime came out in cities, companies decided, "Oh shoot, we should become the exclusive scooter provider on campus. We'll go drop these scooters out everywhere. It'll be branded by the school, and the school will get a revenue share for every scooter ride that happens. We get a captive market that nobody can compete with us in."
This started happening with scooters, and I was like, "Oh damn, what else could be done?" Because scooters are cool because it's a new category, right? Tailgating worked because it was a new category. So, you just have to think about what's something today that they don't even really have an option for. There isn't really a market for it; you're creating the market.
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Sam Parr | what did he say | |
Shaan Puri | Well, we were kind of brainstorming. You know, he's like, "One of the hard things is now schools have gotten slightly wise to it. They won't give the license up super easily," meaning they want to make sure they get a fair shake.
So once you come to them with the idea, they're like, "Great, hold on. 90-day proposal request for proposal? We're going to go see who wants to offer this to us, or we're going to go talk to five companies before we just say yes to you."
But in the good old days, it used to be like, "Oh, they used to be like, sure! You came to us, so you get the deal."
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Sam Parr | I've learned a little bit about selling to schools. I... you frozen.
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Shaan Puri | no I'm here | |
Sam Parr | Oh, there you are! I sent you this company; it's called **Curacubby**. It's kind of a bad name, Curacubby, but basically, I just sent it to you. I told Joe to send it to you. Do you see it?
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Shaan Puri | no curacubby | |
Sam Parr | It'll be baby. What they do is... it's like the most boring thing ever.
So basically, this guy, Steven, had an autistic kid. His kid was diagnosed with autism, and he said, "I don't feel like sending him to a normal school. I don't think they're gonna do anything." So, he started a school, and about 20 kids in the neighborhood went to the school. He was like, "Man, managing the school is a pain in the ass."
So, he found another parent. He lives in Oakland, and the other parents are like tech guys. He found this guy who sent his kid to his school, and they decided to build this software together.
The software basically makes it really easy to collect tuition payments and also pay your bills. It's like a combination of Bill.com, QuickBooks, and Eventbrite, so you can check into after-school programs and stuff like that. They are crushing it! It's just four guys, and they got it up to $2,400,000 in recurring revenue.
But he's telling me all about selling into schools, and it sounds like a nightmare selling into a school. | |
Shaan Puri | Yeah, I think it is. You know, the company who I think has done the best at this is Mystery Science. Have you seen them?
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Sam Parr | is that like a tv show what is that kind of | |
Shaan Puri | Okay, so basically... oh wow, they got acquired! I didn't realize this. They got acquired last year for $140,000,000. Good for them!
So, what Mystery Science was doing was they were like, "Alright, how do we make entertaining videos?" Sort of like, you know, pick your favorite analogy: like Blue's Clues, or whatever, you know, Reading Rainbow, or whatever the hell that's called, or Magic School Bus.
Basically, it's on every topic. So if you're like, "Why are plants green?" they start with a question that any kid would have, like, "How hot is the sun?" They say, "We're going to make the definitive, most entertaining, simple answer to that question."
It turns into, in some ways, like a game where the teacher can just pick one of those questions and be like, "Hey class, today here's the question: Who wants to know the answer to this?" Everyone's like, "Yeah, me! I want to know the answer!"
They're like, "Great! We're going to have this little worksheet and this video. The video's going to tease us with part of it, and then we have to go figure out the next bit. Then we watch the next bit of the video."
So it makes it easy for the teacher to teach a question that people are really interested in. They reached like 4.5 million teachers countrywide, like I think at one...
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Shaan Puri | 30 or 40% of all elementaries were using them so they had like dude how | |
Sam Parr | do they only sell for a $150,000,000 | |
Shaan Puri | Incredible penetration! It was absolutely insane. I don't know why they sold for $140,000,000, but I know that they basically raised very little money and they were super profitable.
So I think, you know, for the guys, they probably made over $100,000,000 off this deal. And, you know, they've raised, I think, they only raised $4,000,000 in their lifetime.
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Sam Parr | got it | |
Shaan Puri | It was a bit old; they started in 2014, so you know, about 7 years or so. I think charging money is always hard, but these guys are super smart. I talked to the guy, Keith, and I just really respected what they had built. I thought, "Wow, what a cool product! Amazing that they've gotten to this level of saturation."
The way they sold it was like, you know, bottoms up in a way. Teachers couldn't help but talk about it to other teachers because they were like, "Oh, this is amazing!" It's like normally when I wheel out the TV...
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Sam Parr | well yeah it makes your job way easy | |
Shaan Puri | Guilty! I'm like copping out. It's like, "Yeah, we're going to watch a movie today in class," but it's different. This is interactive; it's based on questions and it's based on science. They're like, "We're just going to teach science this way." I thought it was amazing.
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Sam Parr | that's so good this yeah | |
Shaan Puri | they reached 50% of the us elementary school market | |
Sam Parr | which is how much revenue were they making wild | |
Shaan Puri | I don't know. At the time I was talking to them, they were doing somewhere between $10 million and $20 million in revenue, profitably.
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Sam Parr | and did they make money through ads or they like sold it or should no | |
Shaan Puri | they sell the like subscription I think to the | |
Sam Parr | It was a subscription to the software. Dude, how do you reach that many teachers but only sell for $140? That's crazy to me. | |
Shaan Puri | Yeah, I don't know. This is wild.
Anyways, I gotta run, dude. I have a call about this crazy crypto thing that I'm trying to get into, so I want to see if I can do that.
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Sam Parr | Alright, we'll talk soon. Oh, alright Sean, if you want to leave, you can leave. I think Ben, do I have to read out some names?
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Ben Wilson | yes actually just one name | |
Sam Parr | Alright, we did this thing where we gave 60 minutes of Sean and my time. What did the person have to do to win?
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Ben Wilson | they had to review rate and review us on apple podcasts | |
Sam Parr | Great! And the winner is... is it? Yes! Spencer Scott, you are the winner! Has Spencer... he follows me on Twitter. He always replies to my stuff. Does he know that he won other than right now?
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Ben Wilson | yeah I told him | |
Sam Parr | Nice! Alright, Spencer Scott is the winner. Last week, we announced the winner for the TikTok contest.
So, we did this TikTok thing where if you made videos on any platform and used the **#MFMClip** hashtag, you could win $5. We gave away 2 prizes. Did we give 3 or 2? Oh right, 2.
Before that, we had a contest where if you rated and reviewed us, you won 60 minutes with Sean and me. We gave that one to Spencer Scott as well.
We're going to keep doing these contests. We're not doing it yet, but we will keep them going. So, that's the episode and that's the winner!
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Shaan Puri | check it out |