What Does It Take To Become Rich? How Some People Make Millions! My First Million Podcast 04-02-2020

Shaan Puri

Sam how are you doing man why are you so angry

Sam Parr

God fucking shit! Nothing works. I hate everything. My Apple TV is not working, QuickTime's not working, and I hate Zoom. God damn!

Shaan Puri

I hate but your your mohawk's working

Sam Parr

that didn't even work I meant to shave the whole thing and I just forgot that up there

Shaan Puri

you did not forget the top

Sam Parr

dude I hate working from home I hate it so much

Shaan Puri

don't worry just like I don't know 6 to 8 more weeks of this and then we're back

Sam Parr

if we're lucky

Shaan Puri

If we're lucky, okay, so let's do this. What do we got? Let's jump right in. The people need...

Sam Parr

The information we were supposed to talk about today was comedy stuff, but I found I want to discuss something that I think is more interesting. However, you want to talk about some lighthearted stuff, which is what's the sway thing?

Shaan Puri

yeah what is the sway thing I saw you I saw a video of you dancing

Sam Parr

was that the first time you'd seen this

Shaan Puri

Dance pretty well? No, I had seen it. Ryan Hoover had posted one of him dancing, and when he posted it, it looked very real to me. Yours did not look as real, I think, as where you were in your room. But when I saw that, I was like, "Holy shit, Ryan can dance!" Then I saw the comments, and everyone was like, "Nice app! How do we get the beta of this app?" I was like, "Oh shit, there's an app that makes you dance!"

Sam Parr

wait

Shaan Puri

so you have this app

Sam Parr

I think it's pretty popular. It's called **Sway**. What it does is you record yourself for 10 or 20 seconds. You just stand there and walk around, moving, and then it uses AI—or I don't know what it is, but it's called **AR** (augmented reality). Yeah, it makes it look like you're dancing really well. I sent it to my family, and I made about 20 of them. They thought I was dancing; it was hilarious!

Shaan Puri

Yeah, it looks pretty funny. If they actually just made it a little bit less good at dancing, it would look real. People would believe it. But it's so good that you're like, "No way, no."

Sam Parr

It's pretty amazing. When I downloaded it, it was number 50 in the app store. As I was playing with it, I saw that it's been climbing up the charts.

Shaan Puri

and did you just download it because you were browsing the app store or you saw somebody do it

Sam Parr

so I all I do I browse the app store and I like to see the fastest growing apps

Shaan Puri

yeah

Sam Parr

And I like to figure out what's going on. I do that with gaming all the time. I have to figure out the games that are growing fastest. So yeah, I do that with just browsing.

Shaan Puri

Gotcha! But it is viral. When you see somebody post it, you're like, "Yeah, this is great! I should do that." So it has this kind of "monkey see, monkey do" virality that I like.

Sam Parr

Well, do you remember that app where you would take a picture of your face and it would make you look older?

Shaan Puri

right

Sam Parr

didn't it turn out that that was owned by a russian company and they were like doing funny stuff with your pictures

Shaan Puri

Well, I don't know if they were actually doing anything, but people were definitely sketched out by it. They're like, "Wait, I just gave my camera roll access to some random Russian developer, and so did like 50,000,000 other people, just to make this old filter or baby filter on my face."

Sam Parr

Yeah, so download that app. It's called **Sway**. Is it called **Suede**? No, it's called **Sway** for sure.

Shaan Puri

It's a cool little app. It's good for little pranks, and actually, you know, that is a lighthearted way to start it because it's just funny. People should just go to your Twitter, and then they'll find the video of you doing it. But this is also part of the deepfake problem. If you don't know what a deepfake is, a deepfake is basically when people can now use technology to make a video look real. You can make anything look real. For example, what they do is they'll take Obama talking, and I can just say any sentence. I could just be like, "Hey, my name's Barack, and I'm the worst president of all time," and it'll make it look like his lips are moving to my sentence. They basically feed in a bunch of footage of Obama talking normally, and the algorithm learns how Obama's face moves when he says certain things. Then, when I input any audio, it'll make it look like he's doing it. Right now, the technology is where it looks a little off, but it's not that far off. If I showed it to my kids, they'll leave it at off, right? But it's just getting better month over month. They just showed a paper that came out with a new one, and it's literally just taking a still photo. They took the Mona Lisa, and they do the same thing. I can go say a sentence, and it will make the Mona Lisa say it. The voice can be that good. It's pretty crazy that they can just do that off a still photo. You don't even need hours and hours of raw footage of the person in order to do this now.

Sam Parr

So, I downloaded an app that does that with the Mona Lisa. Which app is that? Do you remember? Yeah, it's amazing! I'll tell you what it's called. It's really neat, and I think that everyone should download this stuff. I paid $5 for it. It's called... no, I don't remember the name of it.

Shaan Puri

Okay, no worries. But what do you think of this whole deep fixing? Because it's a big problem. Like, your sister's a lawyer, and I think she was a DA before, right? Or something.

Sam Parr

like that well she was the public defender and then she's a public defender in the bronx

Shaan Puri

And people, yeah, now it's like if you can't trust what you see, right? If audio... like we already have photos that could be photoshopped. Audio now can be manipulated too. I think "Livebird" is the name of it, where basically you just talk. You can train this system so that you can just type anything, and it'll say it in your voice or it'll say it in Donald Trump's voice. So if you can't believe what you see, what you hear, or what's in video, then how does that mess up the world? Fake news is going to become a bigger problem.

Sam Parr

Yeah, it's going to become a problem. But why are we defaulting to that? Why are we worrying about it? I mean, yeah, it's going to be a problem, but also let's think about all the amazing things. Like, act like there are going to be fake actors.

Shaan Puri

like my dance like your dance video yeah yeah like let's focus on that

Sam Parr

It's gonna make movies amazing. Like, Brad Pitt won't exist. It'll be... it'll be AJ Pitt, and it will be some fake person. I think that's awesome.

Shaan Puri

So, here's a future world: you literally are just looking at your computer. Instead of today, where if you want to make a movie or an animation, you have to be an animator, a movie editor, or an artist to be able to draw, you're just going to be able to say things. It's going to create what you're saying. For example, you could say, "Okay, what if Donald Trump was talking to Barack Obama, and then Donald jumped in the air and said this?" Literally, it's just going to be able to animate that. That's how far this is going to go, and it's going to unlock the ability to create for people who don't have the technical skills to do it today.

Sam Parr

Yeah, I mean, I'm not too worried about how they're going to regulate it. Because, like, if you have a political ad now, anyone can run an ad on Facebook or on TV that says, "I'm Donald Trump and I hate Mexicans." Anyone can do that now. But, I mean, literally, the tech—you could buy ads—but there are ways to say, "Well, no, that's not allowed." It has to say, "I'm Donald Trump and I support this," you know what I mean? There are ways to, like, event... like if you run a political TV ad right now, it has to say who pays for it. Sure, it has to say, "Is this the house to be?"

Shaan Puri

It doesn't have to be a political thing, right? This can go for anyone. Someone in high school can just bully somebody else. Like, right now, the thing...

Sam Parr

that got deepfakes

Shaan Puri

Deepfakes became famous because people were putting other people's faces on porn actors. You could make it look like I could take a photo of your mom and put it into a porno, making it seem like your mom is in the porno. People were doing this with celebrities and their classmates. The subreddit for this, r/deepfakes, got huge. This is how it became popular; it was like an incredible bullying tool. Forget about political ads; it was just slander left and right.

Sam Parr

did it did it get taken down that subreddit

Shaan Puri

no I think it's still up

Sam Parr

I'm gonna let

Shaan Puri

you know

Sam Parr

I haven't been in

Shaan Puri

A long time ago, when it first blew up, you know, it got really popular because people were... you know, "Oh yeah, it is banned from Reddit now." It was becoming a problem.

Sam Parr

oh yeah

Shaan Puri

But that didn't stop the actual problem; it just stopped the subreddit where people were sharing it. So, I think this is going to be a massive, massive problem for evidence. I think it's going to become a massive problem for slander and, you know, spin. Like, I could take a video of you and make it say that you hate Mexican people, and it's not Donald Trump. People would believe it because they would see your face and they would say, "I saw him say that."

Sam Parr

yeah I don't know

Shaan Puri

And so, I'll tell you what some people are trying to do to combat this. There's a whole bunch of programmers who, in general, have a high bar for the truth. They really want things to be true, logical, solvable, and reliable. When you take away evidence, which used to be a source of truth, it's like, "Well, you're saying this, but I have video of you doing that thing." So that's evidence. But now it's like, "Well, this video could be anything. This video could be fake." They're trying to solve this in the way that they think it can be solved. The theory is that anything you make to validate stuff, the con artist will always be one step ahead. There's too big of a payoff to be able to fake this stuff. It's like a counterfeiter, and so you're always in a cat-and-mouse game, which is not a winning solution. The solution that they believe is that the phone makers themselves, the device makers, will need to put a cryptographic seal on the video when it's taken. It's like a tamper-proof seal, similar to what we have with medicine, where it's like, "If this seal is broken, that means this video has been edited in some way."

Shaan Puri

People will only trust videos or photos that have this **cryptographic seal** on them, which indicates that "this has not been edited." This seal is on the device itself from when it was captured, and it gets instantly implemented.

Sam Parr

who's working on that

Shaan Puri

Well, the problem is a startup can't do this, right? Because it's actually Apple that needs to implement it. It's actually Samsung that needs to implement this. Luckily, Apple is a pretty privacy-conscious company, and they know that if their tools are being used for evil, they'd usually do something about it. So hopefully, Apple is working on this. But I have a friend who was doing a startup trying to do this, and he was running into this problem, which is like, look, the people who need to do this are all the camera makers. You know, the security camera itself needs to do this, and that's the only decent solution. Now, some technical people will say, "Oh, there's nothing that's actually tamper-proof." You can still, you know, get around it.

Sam Parr

But for sure, it's better. They are right, but there are still things where it mostly works.

Shaan Puri

Right, exactly. So, I think that's the world that... that's the way the world is going to work later. You're going to need to see this little icon that says, it's like, you know, it's the gluten-free icon, it's the organic icon. It's going to be this is legitimate, and there's going to be a legitimacy icon on any photo or video that's...

Sam Parr

gonna show you the icon business that's a good business you know jd power

Shaan Puri

no oh I mean I've heard of it but I don't know what you're gonna tell me right now

Sam Parr

but you know what it is though right it's like

Shaan Puri

all I know

Sam Parr

55 jd power awards

Shaan Puri

jd power and associates that's all I know what does that mean

Sam Parr

Okay, so JD Power. The reason I looked into this is because I wanted to create a business like this. I was like, "This is a racket." It does sound like it gives a little value, but you have to be like a benevolent dictator. You can rule it, but you really have to be honest; otherwise, trust is lost.

Shaan Puri

as a service right

Sam Parr

Right, and JD Power, what they do is, it's a $1,000,000,000 company. All they do is test different cars and give them awards. But the way that they make money is that the car companies are members of the organization. So if you're, you know, if you only want the money and don't care about being ethical, you could say, "Hey Ford, our new membership costs this much money. Are you guys in or out?" And just so you know, if you're out, we can't give you any awards.

Shaan Puri

That's crazy! Yeah, if you could be in the business of being the rating agency, that is gold. In fact, you know, one of the problems is, if people remember during the subprime crisis, I believe what happened was these subprime mortgages—the bonds that were the securitized housing bonds, mortgage bonds—were rated AAA. People were like, "Well, how is this rated AAA? This is like a junk bond. Why would it be rated AAA?" I believe it was the banks that were funding Standard and Poor's. So, you know, Standard and Poor's was the rating agency, and they were the ones sort of funneling money.

Sam Parr

into that it's the same thing it's the same thing

Shaan Puri

And so, they lost their... or they didn't actually lose it. They're still around; they're still one of the main rating agencies. But like, that's a breach of trust when the only thing you're providing is trust as a service.

Sam Parr

Yeah, it's the same thing. So, JD Power was sold to McGraw Hill in 2005 for $400,000,000. Then it was sold again recently in 2019, I think, for north of $1,000,000,000.

Shaan Puri

I've really been wanting to do the same thing you have. I've been wanting to create a credentialing agency, either in the standardized testing world. You know, the way the SAT and these other tests work is a racket because they can charge whatever they want. You need that credential to move forward, and for the most part, all these credentials were created at one point in time. So, I was looking into whether there is another credential that I could create, where literally all I'm providing is a stamp, and I just get paid for the stamp. Well, you...

Sam Parr

I've always wanted to create something similar to a vendor's list. So, like, Sean, if you're launching something, you're going to come to me because you think I know a little bit about copywriting. You'll ask, "Do you know any copywriters?" and I'll say, "I know one or two, but they're hard to find." In my head, I'm thinking, "I just gotta create Sam's list," where it just has approved vendors. Now, this is the best... what?

Shaan Puri

Are you saying this is the best, or are you saying these are 10 that you should check out? Or are you saying this is the best one, like Wirecutter?

Sam Parr

Well, I don't think you could have the best one because if you have the best copywriter, that person will always be busy. But there are definitely dozens or hundreds that you can approve. I mean, I guess Angie's List was something similar, and that's huge. But I've always wanted to do this for copywriters in particular. I almost bought Sam's List because people are always asking, "Which copywriter should I choose?" I'm like, "I don't know, man." Look, I could post on my social media, but it's a lot of work for me to go and find them.

Shaan Puri

you right

Sam Parr

but like the same thing with law firms the same thing with accountants

Shaan Puri

right

Sam Parr

I'm like man I gotta just create like a vendor's list of people who I know and approve of

Shaan Puri

That’s cool! The version of this I wanted to do was around either IQ. So I was like, "Oh, okay, like Mensa's IQ." Can I basically create some test that essentially labels people? Then, you know, if you're in the top 5%, you get this extra little certificate. People would pay to basically have that as a bragging right. I was also thinking about it for developers. Is there just an extra credential you could pay $39 to get that basically says, "Yes, I know X language," or "I am competent. I have this level of competency at this thing." I’m really a big fan of, if anyone's out there creating a credentialing agency or trust as a service, I’m very, very interested in those. I think those are beautiful, beautiful businesses. They are extremely easy to run, low cost, low risk. The more you do it, the more powerful they become. Because the more times you see JD Power, even if you don’t fully know what it is, it’s like, "Oh, we need to go get that. That’s the standard."

Sam Parr

So, I just looked up Mensa while you were talking. They have **150,000** members and they are a nonprofit. They do about **$4,800,000** a year in sales.

Shaan Puri

Interesting. Not that big. I wonder about the backstory. Yeah, but like as a nonprofit, you never know what their motive is or how they are doing things.

Sam Parr

Well, but you do know, dude, you can go and look up all their information. They have to file a government form, and you can see, right? How much they pay themselves, how much revenue they generate, and what their expenses are.

Shaan Puri

Right, I guess what I'm saying is I haven't done that part. The same thing can be done for athletes, by the way. You know how NFL players go through the combine? It's basically this battery of tests. You run a 40-yard dash, you do a bench press of 185 pounds, and you do a vertical leap test. I really think that somebody could create a credentialing system where you have facilities in different cities. People would pay to come in to get officially tested and receive their scores. It's like, "Here's how good I am as an athlete." They could use that when they're trying to get on AAU teams or secure college scholarships or whatever it is. Today, we only offer that to NFL players right before they get drafted, but I think this should be a standard service for athletes. They should be able to say, "Hey, what's my reaction time? What's my agility test? What's my vertical leap?"

Sam Parr

So, I did that when I was a kid. When I was in high school, I did the same thing. It was called Spark.

Shaan Puri

spark okay

Sam Parr

**StarQ** and the guy who created it was a... he was a very elite college runner in the seventies and eighties. I think his name was Rudy... I forget his last name, Rudy Chapa. I'm remembering this off the top of my head. Rudy Chapa was a 2-miler from California in high school. I think he had the high school state record or the high school national record for the 2-mile at like 8:30 something.

Shaan Puri

right

Sam Parr

and his name is rudy chapa I think am I right is his name rudy chapa

Shaan Puri

I'm on the website right now I don't see I haven't looked at his name but yeah this looks interesting

Sam Parr

Maybe 450 tests. He was a Nike executive, and then he created the Spark test. What you did was very similar to a combine. I get it; I crushed it. It was a 40-yard dash, a broad jump, a vertical jump, and how far you can throw a medicine ball.

Shaan Puri

right

Sam Parr

And maybe that's it. They would give you a score, and that score... I went to this place called Velocity Sports. Velocity Sports was created by the coach of LSU Track and Field. It was a chain of gyms that high school kids could go to for running and stuff like that. The Velocity Sports must have paid Spark money to use it. Then, when you applied to college, I would put my Spark score to get a scholarship.

Shaan Puri

Yes, dude, that's exactly what I'm thinking about. I'm looking at their website now; it looks very basic. But this is interesting. I think there's a lot of unused facilities, like track and field, that are unused so much of the time. You could do this without capital expenditure (capex), probably, as long as you say, like, you know, when you run a race, and it's like, "as long as the wind conditions are under this, then it counts in the official thing."

Sam Parr

right

Shaan Puri

So, I bet you could use, you know, in the summertime, schools that are empty. You could use their track and field facilities and build a program like this. Because now, parents with kids in sports have become so crazy. People are doing travel sports at like age 6 or age 7. You're paying thousands of dollars for your 7-year-old to play baseball and be on this elite team. This is like a multibillion-dollar industry—the travel sports industry. I think all those people would be interested in getting their kid tested. You could drive Facebook ads to say, "Hey, get your kid tested! Here's your score." Then, every year, you want it upgraded because it's like, "Oh, I've gotten stronger, faster, and taller, so I want my official measurements that are sort of ratified."

Sam Parr

And here's another example of this. This is kind of funny; we're kind of ranting on this. I did zero research on this other than, like, I didn't prepare for this, so...

Shaan Puri

Me neither. I just thought of this idea while we were talking. That's how **fucking great** we are, dude. Just take a minute to appreciate that.

Sam Parr

do you know gallup

Shaan Puri

I do know gallup yes

Sam Parr

Okay, so wait... I did my microphone. Is it good? Alright, so Gallup is a polling service, right? A polling company created by this guy named Joseph Gallup, I think. Then another company, or like a smaller company, bought Gallup. It was a family-owned business. The founder of that company that bought Gallup, his name was... I forget his name exactly. But do you remember StrengthsFinder?

Shaan Puri

yes

Sam Parr

The guy who owned the family business that bought Gallup is the author of "StrengthsFinder."

Shaan Puri

I see

Sam Parr

And so, **StrengthsFinder**... it's hard for me to say they have a book that is popular, but even though it's popular, it doesn't make nearly the amount of money that the company makes. The company makes about **$1 billion** to **$2 billion** a year. It's privately owned and is probably one of the largest privately owned companies in America, ranking in the top 200. They have a quiz, so if you Google "StrengthsFinder quiz," it's a **$29** or **$49** quiz, and it tells you where you rank on StrengthsFinder.

Shaan Puri

right I've I've taken it because somebody sent it to me jim clifton is the name of the guy you're talking

Sam Parr

jim clifton jim clifton his dad jim clifton was the ceo of gallup

Shaan Puri

right

Sam Parr

And this was his thing. It was like a survey. They make $100,000,000 a year off that quiz.

Shaan Puri

Yes, exactly. So, I've taken StrengthsFinder, and this is when I was like, "Oh, this is just bullshit." Okay, gotcha. First of all, it's a test you cannot fail. It's just saying which of these strengths you have. So, you're just going to get one of the... there's like 25 strengths or whatever. It's like, "Here's the 5 you get: leadership, determination, innovation," and whatever. Then the other person gets like empathy, thoughtfulness, and whatever else. So, it's pretty genius. They sell these to companies who want to basically take these personality tests for leaders to say, "Hey, we want to understand our employees better. We want to understand our teammates better," and this will help you work together better. I believe StrengthsFinder was doing like $100 million+ in revenue. I'd have to go double-check that, but yeah, it's like a tremendously successful franchise. The book is really just... it's like a code you get in the book that says, "Go take this quiz online," and then the book is like kind of useless beyond that. But you have to watch.

Sam Parr

The book works really well. Using that book, because like I've said, I've kind of talked about this. Ramon and I own this software for to-do lists, and we get all of our sign-ups practically because one guy who has a book mentioned our service. It gets signed up, and the book's not even popular.

Shaan Puri

That's amazing! Also, like we had talked about that person in our Facebook group, the "My First Million Side Hustles" Facebook group. Basically, they are doing a chess tutoring service. Any niche sport or niche thing like chess... I don't know if it probably is already because chess is so widely established, but there probably is already some sort of benchmark or test you take. But if I were him, I would basically create my own. Anyway, I would say, "Oh, by the way, for all my students, once a year we do this $100 test, and you get your Chess Q score." What your Chess Q score tells you is your adaptability, your recognition, cognition, whatever. And so it is not like total horseshit; you actually are testing to see how good they are at certain things. But I think it's just a very simple way to make a lot of money off of kind of vaporware. There's nothing physical you're doing there.

Sam Parr

vaporware in that it's real but it's

Shaan Puri

It's lightweight. It's very simple to create and maintain. There's no need for employees or assets that you need to buy in order to operate.

Sam Parr

Well, because Sean, someone in the reviews—our latest review—says that you and I are unethical and that you have to check your ethics at the door if you're going to listen to this podcast, which is morally bullshit. But I just want to make them aware that when you say "vaporware," you mean it's real or it's substance, but...

Shaan Puri

yeah vaporware is the wrong word

Sam Parr

for it

Shaan Puri

What I meant is a very lightweight thing to create and maintain, and it is very low cost to create.

Sam Parr

another example of this is dugscore do you know dugscore

Shaan Puri

never heard of it

Sam Parr

Dude, it's just this guy named Doug DeMuro. He's this nerd—like, he's the nerdiest guy ever. He's got like 4,000,000 subscribers on YouTube. He's the type of guy who wears a collared shirt, but you can see his white undershirt sticking out from the sleeves, you know? People like him... I know.

Shaan Puri

exactly what he told you

Sam Parr

He's like a sloppy, dirty guy, but he's amazing. He has a thing where he reviews cars and creates a "Doug Score," which is based on whether a car is fun for a weekend or fun for a daily driver. Now, at this point, he's got 1,000 cars that he's ranked. When I'm buying my car now, I check the Doug Score.

Shaan Puri

Ah, I like that. Okay, that's cool. Like Kelley Blue Book for value and then Doug's score for sort of enjoyment. I like that.

Sam Parr

And Kelley, Kelley Blue Book is a great example. So, Blue Book... Blue Book is a multibillion-dollar company.

Shaan Puri

Yeah, but they provide a little different thing. They have just like a data set that they're able to use to give you a price comparison, which is different than sort of an aptitude test. But nonetheless, I'm curious. Do you think we have low ethics? Do you think you have a sort of looser ethical criteria than most people for business?

Sam Parr

I think that we have a looser attitude yes but by

Shaan Puri

the way

Sam Parr

I think it's significantly above the line of what is considered good. For example, most people say, "I can't pre-sell a product that I don't have." In my head, I'm like, "Who cares? Just refund the people." It's not like I'm saying to steal money. I'm saying to advertise something that doesn't exist so you can gauge demand, improve demand, and then refund the money. I'm not saying you steal from them, but yes, you are lying. So, I think that's ethical.

Shaan Puri

Right, yeah. I think we definitely have a looser definition than the average person. I would say maybe the average business person even. But there is, you know, I think the problem here is there's no standard. Right? There's no definition for what's ethical and what's not. It's completely subjective and judgmental. So the hard part is, you know, for us, we think there's a line between right and wrong, and we're on the right side. We think we have a safe margin, a buffer, where we're in the right. But for other people, their line might be in a different spot.

Sam Parr

Yeah, but that's because most people aren't aggressive. With anything that I do, I would suggest to my mom that she buy whatever I'm promoting. It's like, do I want my family to use this? Or if I told them about what I'm doing, would I want to hide this? I don't. I'm not afraid to tell everyone about anything that I do.

Shaan Puri

I met this guy once. He had reached out to me about a product we were building called Blab, which was getting popular. This guy reached out and said, "Hey, my name's Billy. I'm from... I forgot where he's from, like Santiago or the tribe of Mexico, or somewhere in Latin America." He mentioned, "I'm coming up to California, coming to San Francisco. I want to meet you and talk to you about this company." I was like, "Okay, I don't know about that." Most of the people who are users of a product are not usually people I want to have meetings with necessarily. But he said a bunch of stuff in his email that made him sound amazingly legit. He mentioned, "My family started the first television station in Mexico. I own all these different music festivals." He sounded super legit, but his email was written in blue text font and had different sizes of text. It's almost like I've...

Sam Parr

got copy and paste

Shaan Puri

Yeah, so, I was... well, no, no, no, not like that. It was like he had chosen, like, "No, I'm gonna make my emails blue and not the copy-paste little purple thing." It was just his style. So, I was like, I don't know if this guy's a joker or not. Anyway, we go out to dinner and I have very low hopes. We go to a sushi place, and I walk in and I see probably the most handsome guy I've ever seen. This guy, Billy, was extremely well put together. He's in a suit and tie; he looks legit. We sit down at the table, he orders the omakase, which is basically chef's choice, like $200 each for sushi dinner, and he's like, "I got this, don't worry." I'm like, okay, I'm starting to believe, but you know, he could still be someone who's faking it. He starts telling me a story, and this guy is completely legit. He's probably the most charismatic guy I've ever met in my whole life. I was like, you know, if I swung that way, I'd be in love right now. This guy is amazing. So, at the end of the dinner, I asked him a question. I said, "Hey, you know, you're a very persuasive guy. You clearly are good at this, right? You're clearly very persuasive, very charming." I said, "I used to think I was that way till I met you. Basically, I used to think I was in the sort of top tier of that, but I always sort of had this hesitation of like, you know, should I use my powers for good or evil type of thing? Where do you draw the line on using this?"

Sam Parr

but this guy's legit he was a real part

Shaan Puri

Completely legit. Yes, and so he really was wealthy, very successful, very smart, very charming—all that good stuff. I asked him, "What do you think?" He goes, "My rule is this: if your intentions are good, then it's all fair game." He was like, "All that matters is the intent. If you're trying to scam people, if you're trying to con people, if you're trying to not deliver value, if you're trying to just get something that's a good situation for you and not for the other person, then you shouldn't be doing it. You shouldn't be using all these powers of persuasion." He's like, "But if you think you are genuinely going to help people, if you think you are genuinely in the right, if you think you're genuinely working for a good cause, if your mission is pure, if your intent is good, then it's all fair game. You should use it to the max." I was like, "Alright, Billy, thank you very much for this incredible lesson."

Sam Parr

I completely agree with him. If you study persuasion and charm, I use it in the form of copywriting. Some people are born better at it, but it's a teachable skill. I always tell people, "What I'm going to tell you is going to sound like evil. I'm going to teach you how to manipulate people, but make sure you use it for good." Right? Because you can easily use this for bad.

Shaan Puri

And you know what? Here's a weird counter to this, and this is where people are going to be like, "Okay, this guy's actually evil." So, one way—one of the things—is to say what you just said, which is to use these powers for good. The other thing I've been able to do is the opposite. When I see somebody do something for evil but it works, I try to learn from it. For example, I remember the first time I saw the... I'll give you a recent example first.

Sam Parr

no I completely

Shaan Puri

I agree. So, Trump is somebody who I'm not a fan of. I think the guy is bad in all these different ways. But when I watch him, the guy is an incredibly effective communicator. He's not polished; he doesn't use fancy $15 words. He doesn't have a lot of substance behind what he's saying, but the guy is like a master of communication. He knows how to get his message across in a way that resonates with people.

Sam Parr

I completely agree

Shaan Puri

And Scott Adams, who's the creator of *Dilbert*, was talking about this when Trump was running. If you haven't seen it, go read Scott Adams' blog. He's the creator of *Dilbert*, and he was early on when Trump first announced his candidacy. Scott Adams called it. He said, "This guy's gonna win," and people were like, "What?" He explained, "I've been studying persuasion for 20 years. I've been studying hypnosis. I've been a communicator through cartoons. I know an effective communicator when I see one. This guy is a master." He pointed out how whenever Trump would say things like "low energy Jeb" or when he would call Jeb Bush "low energy," he was using what Adams referred to as "linguistic kill shots." He also noted how when Trump talked about the wall, he would say, "It's a great big wall, a huge wall." Adams emphasized that Trump was painting a picture in people's minds, which is much better than just talking about policy. So, you can learn from people that you think are using it for negative purposes.

Sam Parr

he he and he called out that he was gonna win

Shaan Puri

He called that he was going to win months before anybody even took him seriously. When 538 was like, "This guy's got a zero percent chance," Scott Adams was like, "This guy's going to win." Of course, if he was wrong, nobody would ever really pay attention to it. But when you're right on a contrarian prediction, you get all the credit. Another example of this was Hitler. When Hitler was rising to power, I studied how he got so popular. What did he do? Because when you watch him speak, he's not a very compelling guy. But they did a lot of things. One thing I remember that stood out to me is when I was in 7th grade and I learned about this. When Hitler was trying to rise to power, all the political campaign posters were full color with lots of text, trying to explain their positions on things. Hitler went the other way. Everything he did was black and white. Normally, that would not stand out, but he thought, "I will contrast everybody else who's using tons of color on their stuff. I'll go black and white." The second thing was he would use only big images—really powerful images—and not a bunch of text. He also used movies as propaganda, filling the cinema with people to watch a movie. But it was very much a propaganda thing behind it. So even though he used it for evil, those techniques and principles are interesting to learn from for me as somebody who wants to have a strong toolkit that I can use for good.

Sam Parr

I completely agree. I've been going down so many Wikipedia holes now that I'm home so much. I was reading about Hitler's Wikipedia page because I was researching World War II. It led me to read about the mafia and then back to World War II. It's like he's there, and his rise to power was because he would speak at these... I don't know what the equivalent is now, but just like halls where he, right, like bars or veteran halls. I'm like, wait a minute, he started as a speaker. That's it, right? It was kind of crazy.

Shaan Puri

So, okay, a couple of things. We'll switch topics because people are now like, "What? These guys are saying Trump and Hitler are good? I don't understand." Okay, so I have an idea for you. I call this my new Lambda School idea. Have you ever... do you guys have an office administrator or office admin? I don't know if you guys are...

Sam Parr

We have someone on the side. Yeah, I mean, we have someone who handles stuff. Yes, and they do HR and things like that.

Shaan Puri

right I'm talking more like so admin work or like an executive assistant or secretary do you have anybody like that yeah have you ever so recently I'm at at my work we're hiring an ea right so we had an ea she left we had to hire a new executive assistant and so they put me on the hiring panel and I'm like okay I don't even know what questions I'm supposed to ask like I I I don't really know what the background I should be looking for all that stuff so I started thinking about this started looking it up so it turns out that office administrators or or secretaries or or executive administrators eas is one of the most popular jobs in the country and it's also something where so there's about you know let's say 600,000 I think in the us and they pay pretty well so it doesn't require tons of specialized skill it's pretty much anybody can learn to do this if you're you know somewhat competent but you can make 50 60 70 80 k doing this I thought that's a pretty good paying job and I know at our company the ea's they're critical they do such an amazing job they they're they they help and all the senior leaders do what they do and so I started thinking about this and I said could there be a lambda school for ea's because I think this is something that in 3 months you could teach people the core skills that you need around calendaring booking travel you know note taking all the different sort of core components that you need to do to do this job well you know it's not rocket science you just need to learn the tools and learn the sort of do's and don'ts and then I think companies when you know like us when we're hiring for this there's no like school or degree that you look at where you're like oh because you have this degree you're gonna do a good job and so it's usually like do you already have experience doing this or not but that's a catch 22 because how do you break in if everyone wants to hire for somebody who already has experience doing it and so I'm thinking that you could create a program that tells offers people that says hey in 3 months we can train you for a job that'll pay you 50 60 or 70 k a year and it's a job that has good you know work life balance and all these other characteristics of it and so and you could use the lambda school model where you take an income share agreement you say great I'm training people for 3 months it cost me $3,000 to do this remote virtual school but I make back you know up to 15 k 17 k per candidate that gets placed into a job over time what do you think of this idea

Sam Parr

I fucking love it! I'm looking it up right now: **orgorg.co**. Have you heard of **orgorg**?

Shaan Puri

no that's a hilarious name though

Sam Parr

We use it to see how big their team is; that can kind of tell us how big they are. But okay, what OrgOrg is, it's a community/job board. It's like a... I don't know how you would describe it in one word. OrgOrg is a 100% volunteer-run organization. We have a job board, blogs, resources, private groups, and email lists. It's all for HR and executive assistants, office managers, HR departments, and DIY admin assistants, you know, whatever. So, our old EA was on this, and it was an email list. They would send out blasts like, "Hey, I'm looking for the best IT person. Our company is small; we only have a budget of $2,000. Who do you recommend?" Or, when I wanted to hire a new EA, I had a friend post a listing on there, and I got tons of applicants. What I would do with your idea is I would either buy this company. Man, the lady who runs this—I forget her name—but she could be making $1,000,000 off of this. I don't think she is; I bet she's making hundreds of thousands of dollars. So, right, I would buy that.

Shaan Puri

Buy it or become the platinum sponsor for, you know, a fair rate and use it for user acquisition. There's this powerful thing because once you build the brand, that "hey, yeah, this is like a staffing agency," right? But it's a big internet version of a staffing agency. Once you place some people, two good things happen. The first is you get a reputation that says, "Hey, our EAs have been hired by companies A, B, C, D, and E." We become a trustworthy source for good EAs. But then also, right now, all the candidates in our current EA pipeline came from our existing EAs—people they knew from their network. Your alumni become your hiring partners. So the more alumni you place, the more opportunities you have for your own graduates. I think that's the real power of the Lambda School model, and unlike developers...

Sam Parr

Okay, so the Lambda School model... you gotta break that down. The Lambda School model is saying you train them for free, and then you get a percentage of their salary.

Shaan Puri

yes

Sam Parr

you do love that model for everything

Shaan Puri

Not for everything necessarily, but I think when you have a low cost of training, it's a great model. It reduces the friction to join because you say, "Well, it's free." I only have to pay them if I get a high-paying job out of this. So your incentives are aligned, right? We want you to get a high-paying job. You came to us to get a high-paying job, and we only get paid if you get a high-paying job. If you get a high-paying job, this is a reasonable payback for us providing that service to you. I think any place where you have a low cost of training, this is a very good mechanism. It's not just a debt mechanism; it gets a lot of hype, but really, it's just a debt vehicle. However, I think it's a good debt vehicle for this.

Sam Parr

Okay, do you want to... I have a few things that I want to go over. Do you want to wait until the next episode, or do you want to...?

Shaan Puri

let's do one more and then we'll we'll call it and then we'll save the rest of the next episode

Sam Parr

Okay, then I don't want to bring... let's not bring mine up yet. The reason I wanted to talk about was Roger Dickey's bathroom business that you brought up.

Shaan Puri

yep made made renovation I think but I

Sam Parr

kinda wanna wait you wanna wait on that okay

Shaan Puri

we can do it next time

Sam Parr

Yeah, we can do it next time. Okay, let's bring up... let's, oh, why don't you bring up this Xavier Neil story?

Shaan Puri

okay yes alright so xavier neil I'm sorry I feel like I've been talking most of this past it's okay

Sam Parr

it's it's really interesting

Shaan Puri

So, Xavier Niel is my new favorite billionaire. This is my second section, my segment of the show called "My New Favorite Rich Guy." This guy is essentially like an Elon Musk type of dude in France. But instead of trying to send rockets to Mars, this guy just operates in his own style. He's got the same kind of what I call a "no fucks given" attitude, like Richard Branson or Elon Musk. I never heard of this guy, so I'll tell you how I discovered him. I discovered him because he created this thing called 42. Have you ever heard of the school called 42?

Sam Parr

no so wait so he's in france

Shaan Puri

He's in France. So, I'll tell you his kind of life story. At age 19, he created a business called Minitel. Minitel is essentially a sex hotline, a phone service you know, you call it. It's sort of a sex line. At 19, he creates this thing and it goes gangbusters. He does really well and makes a few million dollars off this. Then, he either creates or invests in and buys a stake in something called World Net, which he sold a few years later for $50 million right before the dot-com crash. Then, his big thing was he created something called Free. Free was like T-Mobile; it was a mobile carrier. At the time in France, all SMS phone plans were very expensive. So, he undercut everybody and created the lowest cost way to have cellular service. Free became this huge company, and his net worth ballooned to about $6.6 billion.

Sam Parr

I'm looking him up now this guy's my favorite person ever

Shaan Puri

Yeah, and he's very legit. So he was like, "Alright, look, what do I want to do now? I want to do more baller shit." So he was like, "Okay, I'm going to create this thing called 42." He decided to create a computer science school with no teachers and no staff. All he did was create this dope facility with a bunch of computers. If you get into 42, you just come, and the computer is your lesson plan. It's like a video game. There's a challenge that says, "Hey, you need to make a website that can do X, Y, and Z." You're like, "Okay." Then, you have the internet and some people next to you, and you all need to figure out how to get past this level. So you start doing the program. It's self-serve; you do it. You complete a bunch of projects to level up, and you create your own projects or ideas. For example, somebody could create a coronavirus tracker right now because that's a timely little website you could make.

Sam Parr

I'm looking it up now they have 25 100 students

Shaan Puri

Yeah, and it's actually closed right now because the physical facility closed here. But it was a wild idea. I don't even know how successful it's been; I don't think it's been a wild success. But I love his bet. He was like, "Yeah, I'm going to put $150,000,000 into this." So he built one in France and he built one here in Fremont for $100,000,000 in California. It was just like, what a radical idea! What a way to bet your money and try to change the world over and over again. Then he did this thing in France. He was like, "Okay, how do I build the startup ecosystem here?" So he created this thing called Station F. If you see this thing, it's like the NASA facility. It's this huge, huge... I don't know how many football fields long office or hangar co-working space. He was like, "Alright, I'm going to make the dopest place for any investor to come when they're in Europe. Here's some space to go hang out. Entrepreneurs, you're starting companies? Come over here and build your company. Here's some office space, restaurants—come here at the bottom, fill this place up, you know, gym, whatever." So he created his own little oasis, kind of like Tony Hsieh did in Vegas; this guy did it in France.

Sam Parr

this guy's amazing station f what what I'm so

Shaan Puri

I just love this guy's style

Sam Parr

So first of all, I've looked it up. Now, he's not perfect. In 2004, he was indicted and detained for a month for misuse of company assets, which occurred in several of his sex shops that he was a shareholder in. He ended up getting a 2-year suspended prison sentence for misuse of company assets. So he's certainly not perfect. I don't know, I'm just reading up on this one thing though. In addition to all this, he owns the rights to the song "My Way" by Frank Sinatra, which I love. He also owns one of the largest newspapers in France. Yes, super interesting guy! But I'm curious about people like this. Is Andrew Wilkinson going to be on the podcast this Tuesday?

Shaan Puri

yeah next the next episode basically

Sam Parr

So, Andrew kind of... not exactly, but kind of does it in the same way as well. We have to ask him about this. What I want to know is, how do these people manage so many freaking projects? Right? Because, like, I can't even manage what I have on my plate. And like, right, so for example, Prolific...

Shaan Puri

So, they hire people to run their operations, right? I worked with a guy, Michael Birch, who's kind of like this billionaire type of dude. He created this incubator with a totally different model where everybody owns all the equity in all the projects. He picked me to run the show for him. He trusted me; he's pretty hands-off. We checked in, but he let me run the show. I was looking at this guy, Xavier Niel, and he's got a woman from Google who runs Station F, the big facility. He also has someone who runs his investment fund. The guy was telling a story; he goes, "You know, we don't have board meetings." But I was like, "Xavier, don't you want to know what I'm doing with your fund?" He said, "Yeah, for sure, tell me." I told him, "Hey, we invest in all these companies. I think we should double down on these winners, make fewer small investments, and do more on the winning companies."

Sam Parr

and what did he say okay

Shaan Puri

He goes, "I'm not doing this to make more money. I'm doing this to make more companies invest in more companies." I was like, "What?" He's like, "You could double down, but don't stop investing in new small companies." The other thing they talked about in his presentation, kind of like what you're saying, is how do you manage this? They showed the guy's email inbox, all the emails from this guy. I've noticed this a lot with wealthy, busy people: their emails look like text messages. For example, this guy will write him a long email about, "Hey, we're thinking about this plan. Here's what we could do."

Sam Parr

here's what their reply is okay cool or like

Shaan Puri

Literally, it's up to you. "U" is the letter, and then "all good."

Sam Parr

where do I see the screenshot

Shaan Puri

There was a story, I think it was from Forbes or Bloomberg, about this guy. They put that in there, but I think this is a pretty common thing among people who do a lot of stuff.

Sam Parr

I guess it's kind of like if I buy... I've talked about how I'm going to buy a toy car, like a fun car. I guess it'd be like the equivalent of me buying a $10,000 car and letting someone use it. It's like, "Dude, I don't care. Just make sure it comes back in one piece."

Shaan Puri

Right, and so, you know, the thing I guess I want to clarify is that when Andrew's coming on on Tuesday, I like Andrew for the same reason I like this guy. They're totally different, right? Andrew has not gone to jail, didn't start a sex hotline, and is not a billionaire. Like, well...

Sam Parr

we don't know that for sure

Shaan Puri

yeah exactly well not publicly

Sam Parr

guy are and and this guy has about 20 years on andrew so give him time

Shaan Puri

But I guess the thing that stands out to me is I respect, above all else, people who do things their own way. People who are original thinkers and decide to live life on their own terms. That's kind of what I got out of this guy. I feel like this guy, Branson, Elon Musk... the thing I like about them is that they definitely have lots of flaws and lots of messed up things that they do. But I just respect that they don't just follow a normal societal playbook. They live life on their own terms. They basically march to the beat of their own drum, or whatever. That's what I like about them. That's what I like about Andrew; he's done it completely his way, which is very nontraditional. Do you?

Sam Parr

think this guy speaks good english

Shaan Puri

this french guy

Sam Parr

yeah let's

Shaan Puri

I bet he's alright

Sam Parr

Let's fucking email him. Yeah, let's do it. I'm looking at him now. I mean, I would... if you're French, I mean, if you're a magnet like this, I would imagine you speak some English. But is he?

Shaan Puri

I

Sam Parr

don't know if he speaks good enough english to be on this

Shaan Puri

I'm sure

Sam Parr

he speaks

Shaan Puri

I'm sure we'll learn french dude we'll we will we will make it happen if we need to

Sam Parr

Yeah, it'll be like Yoel Romero on Joe Rogan, where he just has a translator on the podcast. Right? I'm down! I would love to do this. This guy is in cahoots with this other guy who I don't want to say his name because it's too embarrassing if I try to pronounce it. It's French, but it's Bernard Arnault. Do you know who that is? You know, it's LVMH.

Shaan Puri

oh no okay

Sam Parr

I'll tell you really quick. He usually goes back and forth with Gates and a few of these other guys as the richest person in the world. LVMH stands for Louis Vuitton Moët Hennessy. They own Chanel, they own Louis Vuitton, and they are the largest luxury group in the world. They also own Fenty, which is associated with Rihanna.

Shaan Puri

fenty yeah

Sam Parr

Yeah, they own that. So, the way he started it was his father was wealthy and they owned a construction business. It was big, but it wasn't like billionaire big. I think they sold it for about $20,000,000 in the sixties, which is a lot of money. I mean, that's probably the equivalent of $100,000,000 now, so it's a significant amount. Anyway, he convinced his father, when this guy Bernard was in his twenties, to divert their focus. He said, "Dad, we gotta sell our construction business and buy luxury goods." He noticed that when he went to New York, everyone knew what Chanel was, but that's not even a big company. So, he suggested, "Let's buy Chanel." They bought Chanel for a small sum of $1,000,000, but not what it's worth now. Then he ran it and started buying more and more, turning a construction company into the owner of Louis Vuitton.

Shaan Puri

Dude, they own a lot of stuff. Let me just throw out some names. They own Belvedere, they own Hennessy, they own Dior, they own Fenty, they own TAG, they own Hublot, they own Moët. I mean, this is like, I don't know, a luxury brand that's not on this list?

Sam Parr

Yeah, they own it all. Like, do they? But then, I think Gucci is its own brand.

Shaan Puri

Yeah, it's kind of like, you know, the AB InBev, where it's like two companies own all the other sub-companies.

Sam Parr

yeah well this freaking guy did it and he it started as a construction business

Shaan Puri

right

Sam Parr

And this doesn't happen that much anymore, but this is what I love about business. For some reason, it seemed like this happened a lot more. The Chinese are notorious for doing this, where they diversify like crazy.

Shaan Puri

So, I don't think this happens more often. I think this is just something that occurs on like a 50-year horizon. It's just hard for us, who for the past 5 years have been furiously looking at this, to see these things that are playing out over 50 or 100-year arcs, right?

Sam Parr

I agree with you, but I've studied a handful of Chinese companies that were launched in the nineties and 2000s. They are crazy about doing that, right? They would start something, and like two years later, they own apartment buildings. It's like, what the heck? That's not even... And the Japanese have done it as well. They have a name for it. I don't want to pronounce it because I don't want to butcher it. I don't even know how to say it. It starts with a "K," "Kazu," I think.

Shaan Puri

and

Sam Parr

It's basically like, how do you know how Yamaha makes motorcycles, pianos, chainsaws, and power blowers? It's kind of like that. They are known for doing that.

Shaan Puri

and so what do you okay so I I was saying what I respect the most

Sam Parr

softbank did it too right

Shaan Puri

So, what I was saying was, what I respect the most is people who create their own playbook on how they want to live their life.

Sam Parr

I agree pull it off

Shaan Puri

What would be your... because, like, I think you kind of like the mogul types. You love researching. What do you think is your highest, highest bit thing you respect?

Sam Parr

People who... the same. You said it best. I agree with what you said. People who look at the world and say, "Yeah, I get it. The world's this way. I'm gonna bend the world to make it my way, though."

Shaan Puri

and have you like in your own small way do you think have you done that like what's an example

Sam Parr

of where you've bent the

Shaan Puri

world into working the way you wanted to work

Sam Parr

I think that... so I'm from Missouri. I believe that some of my friends from Missouri think that I have done that. I do not think that I have done that right, but I believe, give it time, and I will.

Shaan Puri

I think some of the things you did with the hustle were like that. For example, you didn't go the VC route. In fact, you did some weird stuff like crowdfunding and other things along the way. From the beginning, I remember you distinctly saying, "Why don't you do Facebook? Why don't you do video? Why don't you do Snapchat? Because it's hot." And you were like, "No, I want to do email because that's my own little pirate ship that I can own. I'm not dependent on any other platform. I want to make my own pirate ship, and I want to get my pirate ship to be a big fucking pirate ship." I just never really heard anyone talk like that or think like that, where they were so specific around the path to victory.

Sam Parr

Dude, I have a video. Normally, I try not to brag on myself because I think I have a lot of flaws. But the way our company is shaping up now, I made a video in 2015 and I outlined what was going to happen. It is 100% happening exactly like that.

Shaan Puri

where where is that video what what

Sam Parr

That's on YouTube. If you Google "The Hustle Seed Invest," I explain that we're going to build to a million people. We're going to profit from advertising, and we're going to use all that profit to build more stuff. Then, we're going to sell that stuff and build more media around it. And it is happening exactly as planned. Do you know how you said "pirate ship"? Let me show you something. Hold on, let me show you something. Stay there.

Shaan Puri

alright

Sam Parr

so I'm off camera so I'm gonna show you why you're gonna see what I'm doing

Shaan Puri

this is mexican

Sam Parr

what's that sean

Shaan Puri

Alright, so Sam just dropped his pants and I'm looking at a giant pirate ship tattoo on his thigh. When did you get that?

Sam Parr

In 2, like right around when I was telling you about the company, I got a pirate ship and it says, "Bold, Fast, Fun."

Shaan Puri

so you basically

Sam Parr

and that's how

Shaan Puri

you you tattooed your business plan onto your thigh

Sam Parr

Yes, I love it because I tell everyone, "Our email list is our pirate ship, and every email is a little bit of wind in our sails."

Shaan Puri

I love it! That's great. Okay, we gotta end on that. That's a classic. I should have taken a screenshot of that one. Okay, so we will see you guys Tuesday. We're going to have Andrew on. When we say Tuesday, that's when we record these; they come out then.

Sam Parr

I look like a freaking loose cannon right now with the mohawk and tattoos. I'm not actually like that.

Shaan Puri

alright man I will we'll catch you later okay