Our 2020 Predictions For OpenAI Came True… Here’s What’s Next (#508)

Shaan Puri

Alright, this morning Sam texted me a great idea. He said, "Let's go back through the archive. Let's find things that we predicted or strong opinions that we had at the time, and let's bring them back up. Let's see, did we get them right? Did we get them wrong? What did we get right? What did we get wrong? And what could we learn from it?" So, we're going to go back. Nobody does this, by the way. Everyone loves to make predictions and have opinions, but nobody ever goes back unless they were right. Well, we're going to show you where we were wrong on a bunch of these. We did 7 or 8 of these that we had a strong opinion on a couple of years ago, and now they've played out. We can review how we did, and at the end, we make 2 new predictions. So, 2 new things that have our spidey sense tingling—things that feel like they could be big opportunities. We're going to plant our flag and say, "Look, I think this is one of the new ones," and we'll see in 2 years if we're right or wrong. That's at the end of the episode. Alright, enjoy!

Sam Parr

alright we're live what are you drinking

Shaan Puri

this is my secret sauce right now I'm not telling people about this yet

Sam Parr

water nope they can

Shaan Puri

see from the color it's a little different

Sam Parr

green water

Shaan Puri

I'm just doing some experiments. You know, I thought we had Derek from More Plates More Dates on, and he was talking about pre-workout, right? He created Gorilla Mind, that supplement. Then we talked about Bucked Up, and they are a pre-workout supplement. Basically, it's like people take a scoop of something before they go to their workout so that they get a way better pump. It really helps with vasodilation and gets them to have a better workout. I want that for work. I want pre-workout for work. So, I am experimenting with some things that will help me have a boost of focus and productivity.

Sam Parr

yeah caffeine I think it's called but that's okay

Sam Parr

you don't not caffeine

Shaan Puri

caffeine is for for mere mortals

Sam Parr

Let me ask a quick question. Alright, by the way, today's episode is going to be exciting! We're actually going to go over some of the predictions that we've made, both right and wrong, since the podcast started. A lot of these predictions come from the 2020 era. We're going to look back, and we're going to call it what you said: the "I Told You" episode.

Shaan Puri

I told you so

Sam Parr

I told you so, but it is also going to be, "I told you we are stupid and we get things wrong as well."

Shaan Puri

I told you so and sorry I told you that because I might have

Sam Parr

been wrong right but I got you but I definitely told you I definitely saved you

Shaan Puri

I just want you to take your right hand. I want you to put your right hand in the air real quick, and I want you to reach back and give ourselves a little pat on the back here. Why not? Not because our predictions are so great, but because we're actually revisiting predictions. Predictions are one of those things that people love to do. They love to spout random opinions about stuff, and then it all just gets washed away in the noise of social media. Rarely do people ever go back, and when they do, it's only for one reason: when they were right. Nobody ever goes back and says, "You know what? Nobody asked, but hey, I just want to tell you I think I was wrong about that one," or "I was at least half wrong about that one." That's not the code we live by—not here, not us. So, we're going back. Nobody asked us to do this, but we're revisiting some of the things we said, and we're trying to figure out: were we right, were we wrong, or something in between? We have a handful of these that we're going to go back to. These are, like you said, from 2 to 3 years ago, so they've had time to bake, and we'll see how they turned out.

Sam Parr

Much time, but a little bit of time. The thing about predictions is... I was, you know, there's a lot of crazy stuff going on in the world right now. I was curious. I was like, you know, you and I have been having this discussion a little bit off the pod about, like, where do you invest your money if you think the world's gonna end? It's part thought exercise, part like, things are crazy. I was looking at a lot of really smart people, smart money people—Bill Ackman, Ray Dalio. You cited Ray Dalio. Well, Ray said this, and my reply to you was, "Yeah, but he's been wrong about X, Y, and Z." I had to go and dive deep about where they were wrong because if you just read the Wikipedia page, you see when they are right. Like, Bill Ackman was right about all these things. He was like, "Oh, but he actually lost a ton of money on this thing." Predictions are challenging because not only are they hard to make, but the people who get them right a bunch of times are also wrong a ton of times. So, it's really challenging to know who to listen to.

Shaan Puri

It's like a batting average, right? If you bat .300, you know, like I don't follow baseball anymore, but I think you're like an All-Star. That means you're missing 2 out of 3. You're not hitting on 2 out of 3 predictions. Predictions are way, way, way worse than that, right? If you're predicting correctly on 5 to 10% of your predictions but you're right in a big way, meaning you're non-consensus, then you make it big. One of my favorite quotes, which I said on the Chris Williamson podcast, is: "Pessimists get to be right, and optimists get to be rich." One thing we'll see when we go through these is that the times where we said, "It's not gonna work," those are the ones where we have a higher hit rate, right? Because pessimists naturally get to be right more often. However, the money is made when you're an optimist about something that other people are pessimistic about.

Sam Parr

Or, as my father once told me, "Hey, even a blind squirrel finds a nut once in a while." I love that phrase.

Shaan Puri

by the way

Sam Parr

Speaking of nuts and seeds, let me tell you about this first one. A few years ago, I was interested in freezing sperm. The reason I was interested in freezing sperm is because... [Note: The transcription appears to be cut off mid-sentence, so I've added an ellipsis to indicate this.]

Shaan Puri

to know but okay

Sam Parr

No, listen. Men's sperm count is going down at a crazy rate. Remember Ben, our old producer? Ben had this big thread on Twitter where he documented sperm count. He made some drastic prediction that in 50 years, a very small percentage of men are actually going to be able to procreate. This is actually a really big deal. I've been researching and I've been interested in that topic for a minute. So, I tried freezing my sperm. I actually re-looked at the episode where we talked about it, and the episode was Sam's unboxing of his sperm kit or something like that.

Shaan Puri

yeah because you had it you like held it up

Sam Parr

Dude, here's the story. So, like, you have to get the sample first of all to do it at a hospital, which I also did. You have to bring the specimen 30 minutes after capturing it. So, like, if you're not close to a hospital, I don't know what you do. Do you go in the room? Do you go in the parking lot? I don't know. It's like a really weird thing to collect, and it's a very shameful thing to handle.

Shaan Puri

parking area it's a covered parking area you could pull into

Sam Parr

It's a very shameful thing. Like when you walk into the doctor and drop the bag... Have you ever given pee? It's like, that's kind of shameful. Giving sperm is way worse. And so I...

Shaan Puri

Use making excuses. I'm like, "I just didn't have a lot of water today," and they're like, "We don't need to know." I'm like, "I captured the specimen though."

Sam Parr

Yeah, it's a very shameful thing to do. So anyway, I tried one of these at-home services and I brought it to my office because you have to do it, then you have the refrigerator, and then you have to mail it in. I packed it in a box within a box so no one even knew. But I had to do it at lunchtime, and people in my office were like, "What's in that? What's that in the refrigerator? What's this box?" And I was like, "Oh, it's just a..."

Sam Parr

just a thing it's a thing but it says like it says it's like a biohazard or

Sam Parr

something on there and then eventually someone like I was like alright what is this and I'm like it's my sperm

Sam Parr

And my employees got really angry at me. They told HR, and I was like, "I... I don't know what you want me to do."

Sam Parr

To do, man. I just... this is what I had to do. So, that's like a funny update. I tried two services: one was called **Legacy** and the other was called **Daddy** (D-A-D). At the time, Legacy had raised $1,500,000. The update on them is they've since raised a round of $3.5 million, a round of $15 million, and a round of $25 million. So, what's that? That's a total of $45 million they've raised. I presume things are going well with them. The most recent round was in 2022. As for Daddy, the company that I talked about, it's kind of a weird name; I don't even like saying it. They had only raised that... yeah, it's weird, man. So, that company has since been acquired. They were bought in 2022 for $100 million. So, that is a thing that we nailed, I think.

Shaan Puri

And I think you almost had back-to-back episodes because you also were talking about TRT. We said D to C TRT. I think we were like six letters, and we want to make a $100,000,000 D to C TRT. We were both like, "That's a great idea!" I thought you were going to start that company because I was like, "This is genuinely..."

Sam Parr

like crazy

Shaan Puri

A fantastic idea you researched, and I was like, "You're kind of shameless enough to go do that." But you didn't do it. However, you did introduce me to the company that was doing it, I think, and we both invested in it. It's doing fantastic - a company called Hone. They've gone... I mean, they're gangbusters. Every one of their updates is fantastic.

Sam Parr

yeah I think the I think that's

Shaan Puri

That was a right prediction, I would say. Those were both off the beaten path. I don't think a whole lot of entrepreneurs were thinking about capturing the specimen, so to speak, and you were. It paid off.

Sam Parr

I think I invested at a $10 or $15 million valuation. I don't actually... I haven't read their updates because I think they got sent to my old email. If you're listening to this, [company name], update my email! But I imagine that business is worth 9 figures now. I would think it's worth 10 times the investment. So anyway, that's an interesting one: TRT and sperm collection.

Shaan Puri

Yeah, those are correct. I can't find this client's info.

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Shaan Puri

let's do one that was maybe incorrect

Sam Parr

So we were bullish on... I don't know if we were bullish, but we were very fascinated by BitClout. Another thing that we were fascinated by... I remember the day you told me about what an NFT was. When you explained it to me, I thought it was awesome. You're like, "I just bought this Kobe thing, this Kobe card," and I was like, "Alright, that's kind of cool." And then... things... the world went a little crazy.

Shaan Puri

For that one, it was actually amazing. It was genuinely beautiful to look at. Whereas, like, NFTs then became, "I got this rock, I have this squiggle," and it was like, okay, you know? You're trying to make a buck, but there is no art aspect to this.

Sam Parr

and I think you paid $500

Shaan Puri

I think we paid **$700** or something like that, and then we flipped it for **$10,000** like, I don't know, **30 days** later. It was actually credited to Ben, so Ben was the one who got us talking to a bunch of NFT guys early on. You know, the right move would have been to just go crazy on it for a while or invest in the companies behind it. But I saw that this artist I really like, **BossLogic**, was doing one, and the **Kobe** one looked great. I bought it, and then when I saw it selling for **$10,000**, I was like, "I mean, it doesn't look that great." So, I'll sell it to this guy, and I can still look at it whenever I want.

Sam Parr

well so

Shaan Puri

I was out of there

Sam Parr

The other thing we talked about was **BitClout**. So, Mark, in episode 164 on March 26th, 2021, I mentioned that I signed up for this thing called BitClout because my friend Ryan Beagleman called me and said, "This thing looks cool, let's try it." So, we both signed up for it. It was all the rage for a minute. So, **BitClout**.

Shaan Puri

Ryan was on that episode, so he kind of was pitching it. He called us beforehand, told us to get on, and then he pitched it to us on the episode. So, what did he say?

Sam Parr

So, Bitcloud, by the way, is basically a social platform. It was essentially Twitter, but there was a crypto component where you could buy into someone's...

Shaan Puri

Right, you don't just follow Sam. You basically buy some of the Sam coin. If Sam is going to get more popular, other people are going to buy the Sam coin as well because that's how you kind of subscribe or follow the person. We've all had this moment where you see somebody early on and think, "Oh man, this person's awesome. They're going to get big." Big Cloud was organized such that you could do that. It also had, almost like because of that, a Patreon built in. It's like, "Oh, I already have all these kind of paying shareholders. I could just create content just for them only." If you own a certain amount of my coin, you get to access this content, which is what OnlyFans, Twitter Blue subscribers, and Patreon all do a version of. So it was like baked in from the start, versus usually those are third-party services.

Sam Parr

And it was a service. It was one of the very few crypto things I actually thought was interesting. You said, I think you were saying it's interesting because you...

Shaan Puri

Let's do the Ryan one first. So, Ryan goes, "I remember when Facebook came to my college, and we were one of the first colleges. It was really fun. This is the first time I felt like that in a long time. That's why I wanted to come on the show." Then you jumped in and you were like, "Yeah, two big differences though. One, you didn't have to have money on Facebook. You just, you know, you just go use it. And two, like you're putting money into this thing that we don't know the people behind this. We don't know how it's working. Like, it's a little nerve-wracking. And there was no withdrawal button at the time. I couldn't even withdraw."

Sam Parr

money from it

Shaan Puri

You're like, "Hey, red flag! Money can only go in and it can't come out." And then we were like, "No, don't worry about all that, bro. They're a downer over here." And I said, "Here's my quote: I don't know if this is a scam, but it kinda looks scammy to me." Then I found out who was behind it. They were anonymous at the time, but I had found out by asking around. I said, "I do know the founders. They're legit people in the tech scene, and they do have a reputation in our circles." They had raised, I don't know, $100 million from Andreessen Horowitz and others.

Sam Parr

in this case on

Shaan Puri

Later, we had the founder on, and I said, "You know, what I liked about it is that today, if I sell on Amazon, I keep 70% of the value I'm creating as a merchant on Amazon. If I stream on YouTube, I'm keeping, you know, 70% of what I... actually, not 70%, more like a 60-40 split of the ad revenue. Twitch, you know, is roughly 50%. Then you go down to platforms like Facebook, Instagram, and Twitter, where the users at the time captured $0. Those were multi, multi, multi-billion dollar companies, and the users who created all of the content and consumed all of the content—the users did all of the work to create the value of the network—were getting nothing. I said, "Well, it does seem like crypto is kind of cool because it can change that. It can basically reward the people who do the work and create the content on these networks." The second thing is we loved the growth hack. What they had done was take all the popular Twitter people and pre-buy a bunch of their coins. So when I joined, I think there was like $75,000 of value for me to just go claim. I was like, "Okay, I'll push that button; we'll see what happens." They had used the money they raised to buy up popular people's coins, and then to claim your coins, you had to sign up for your account and tweet out, "Hey, I'm verifying my BitClout." That was kind of going viral for a bit, and that mechanic worked until it didn't work, and BitClout failed. We know several people personally—Dharmesh and a few others—that invested a million dollars publicly into BitClout, and that one... well, you know, smart people were doing it. It was an interesting idea; ultimately, that idea failed. I would say, you know, we were excited. I was more excited about it than you, for sure. You were like, "Immediately, I think we were pretty much out," correct?

Sam Parr

well I I I was out but I liked the idea of it the idea of it was actually fairly interesting

Shaan Puri

like I like the free money

Sam Parr

Yeah, well, no. Like, Twitter ended up doing it where they just gave you money. So, I get paid, I think, $3,000 a year. It's on track for $3,000 a year for tweeting and getting impressions. That's cool, but you didn't need the crypto component of it.

Shaan Puri

No, but that's different. You get paid a share of ad revenue. Me, for following you early on, kind of being one of your early believers, for retweeting your content, for all that stuff... I couldn't benefit from that, right?

Sam Parr

But it's the same outcome for me as the creator. I feel a little bit more bought in... well, no.

Shaan Puri

because like what was your last twitter check $50

Sam Parr

$3,000 divided by 12 is $250. Maybe something like that. Or it's $400, maybe.

Shaan Puri

So, let's say you make $400 on Bitcloud early on when it had, I don't know, 50,000 users... something like that.

Sam Parr

you were at 75,000

Shaan Puri

My account was worth $750,000. You know, I could've literally pushed the button and cashed that out if I had.

Sam Parr

I cashed out a little bit of it a year ago. Someone bought a bunch from me. They were like, "Hey, I'll give you Ethereum for all this," and I was like, "Sure, I sold it." So, why would...?

Shaan Puri

people the funny thing do you know there's a new one that's basically the same model and it's crushing right now

Sam Parr

friends and tech or something

Shaan Puri

Friend Tech... yeah, I'm not on it right now just because I have been busy with other stuff. But it's generated like **$250,000,000** in revenue for the project itself. I think it's distributed an equal amount to people who have generated that much on it as well.

Sam Parr

So then it sounds like BitClout. Well, let's do an update on BitClout. It seems like we were wrong about BitClout and that it didn't work. The idea did work in FriendTek, right?

Shaan Puri

I think I would bet that in the long horizon, let's call it 20 years, these networks will be built in. These networks will do this: they will have a currency for the users on the network. The users who contribute to the network will own and control the network.

Sam Parr

so I

Shaan Puri

I do believe that that's going to be true. "Frantic" I think is like another kind of attempt. I don't think it's probably the one, but I do think over the long haul, somebody will do that.

Sam Parr

So, where's Bitcloud now? They changed this to something called DeSo, I think, right?

Shaan Puri

Yeah, they're doing a bunch of stuff. I haven't kept up with it, but yeah, Bitcloud was like, "Oh, that was just one app on top of the DeSo protocol." Then the DeSo protocol had many apps, like the Diamond app and this app. I don't think, in all honesty, any of it has gotten off the ground in a meaningful way.

Sam Parr

alright pick a winner or pick don't don't pick a winner pick an interesting one

Shaan Puri

Okay, an interesting one. Okay, Clout Kitchens. So, way back, we did an episode. Let me find the...

Sam Parr

I think we were talking about my cookie dealer and a bunch of other

Shaan Puri

other pertinent so so I came over to your office to record one day you could make it for whatever reason and you were like oh my buddy stu who had been kinda listening to some episodes stu iverson was there and he was like I'll jump in and he jumped in and he had a bunch of ideas one of the ideas he had was he's he goes you know how travis kalanick has left uber and he's got this idea of cloud kitchen so he's like you know I'm gonna create these restaurants that are just built for uber eats built for doordash and they'll be delivery only there's no physical location blah blah blah he goes well there's a better he's I have another idea clout kitchens and I was like clout kitsch what do you mean he he goes like you know social media guys who have clout you know they have this like you know they have a big influence he's like I think they're gonna open up their own restaurant just like you know there's margaritaville and there's and gordon ramsay has his restaurants or whatever you're gonna see celebrities create their own restaurant brands they're just gonna license their name and face to somebody and then fast forward like I don't know a year year and a half mister beast burger comes out and mister beast one of the biggest social influencers launches his own virtual restaurant chain exactly as stu had predicted and at the beginning it looks great because the launch is insane there's videos of people just like going and trying to to order this stuff and I think it did over a 100,000,000 in sort of gross revenue you know just sort of purchases of from from beast burger in year 1 in year 1 and so it looked like at the time damn stu called it great idea however cloudkitchen's thing has a couple of issues 1 is you really hard to control quality why because the way these work are they're just mom and pop restaurants and they send the packaging to them they're like hey if an order comes in that's in your area you're gonna make a burger just make whatever burger you normally make just try to make a good burger a good cheeseburger but wrap it up in this piece burger packaging and put it over here the guy's gonna come pick it up that's how cloud kitchens work it just gives existing restaurants extra order flow but because of that you have total like no control over quality because you have you know 400 operators each making a different recipe each with a different you know sort of quality control around this and at some.

Shaan Puri

MrBeast was like, "Dude, this is actually bad for my brand. People are ordering... it's not right, it's not good. Whatever, I need to distance myself from this." And now they're in a lawsuit with each other because they're like, "Nope, you signed your rights to us. We're going to keep calling it this, and you're hurting our business by saying that." So now he can't really talk about it.

Sam Parr

So, it's not a fail. That's not a failure of us. I mean, it's a failure for him—poor execution. But it could work, you know? It just so happened he was the biggest, you know, at the time, or still is, and it got too big too fast. That doesn't mean it's a bad concept.

Shaan Puri

And I still think if someone's going to do this, you could do it. You just need to have a much more controlled skew. So if somebody needs to do it with, like, I don't know, cookies, or they need to do it with, like, you know, what's it called? The edible arrangements or whatever. It's like, here's a gift you can send somebody. It's like, you know, you need some celebrity who's going to just create the version of edible arrangements on top of DoorDash or whatever. Just like this gifting thing that's more consistent. So maybe you could just send the final thing to each location.

Sam Parr

I think Reed told us on the pod when they launched Beast Burger. He was like, "Me and Jimmy were just in a bedroom. We threw it together in 90 days." He made it sound pretty ragtag, like it was just, "Oh, let's just throw it out there and see what happens." I don't know if that's the truth, but that's kind of the energy that was implied. You know, so it just didn't work out for execution reasons, but it could still happen.

Shaan Puri

Okay, here's one that we were... okay, I'll give you two that I was right but pessimistic about. So, Clubhouse. I wrote a Twitter thread that was kind of like the thing that blew up my Twitter for a while. I wrote a Twitter thread that basically told people why Clubhouse was the hot name at the time. It went from nobody being on it to the cool kids being on it, to this is a $2,000,000,000 company—all over the course of less than a year. This thing was just flying, and it was like, "Oh, this is the next social network." All the big names were believers in this thing. I remember enjoying being on it, but I was like, "Oh, this is not gonna work for certain reasons." Then I would hear really smart people, you know, Marc Andreessen investing in this thing, Andrew Chen, the social guy—oh, he's investing in this thing. Then you hear Naval, who's an investor in it, and he's like, "This will be bigger than Twitter." Then, you know, Sahil from Gumroad—I remember listening to him on a Clubhouse thing, and he's like, "Clubhouse will be bigger than Twitter because everybody can speak and not everybody can write." I was like, "That's not how this works! You can't just be like, 'My app is called Breathe, and everybody breathes, so I'm gonna be the most valuable company.'" I was like, "What is this logic?" I wrote this thread. I said, "Hey, everything's closed. It could be the next big thing, but I think it's gonna fail, and here's how I think it goes down." I wrote this thread, and the thread goes viral.

Sam Parr

yeah you had like celebrities reach out isn't that how you met hasan minhaj and who else

Shaan Puri

I thought you had... so there was a bunch of people that were like, "You know, I don't wanna name drop, you know what I mean?" But like, yeah, it was crazy. It was people that I admired.

Sam Parr

yeah it was like your heroes I don't I mean like I like some of these podcasts the sports podcast guys you

Shaan Puri

I know authors who were famous, you know, writers or whatever. I either followed or DM'd them, being like, "That was so, so, so good." So, I thought that was great. But I also got blocked by a bunch of VCs who were in marketing recently. They blocked me. They're like, you know, they go from following to blocking instantaneously. Why? Because I told them that maybe their investment wouldn't work out. I got some hate. Some people were like, "Oh, why are you rooting for a startup to fail?" I said, "I didn't say I'm rooting for it."

Sam Parr

Just, you're actually in the thing. You said, "I don't want them to fail." I just have experience in this space, and I don't think it's going to turn out well.

Shaan Puri

Nicely, yeah, but I think rightfully so. People don't believe that. It's like, "Look, I wish you the best." They say that when they're fighting, like, "Look, I wish you good luck," and it's like, "No, you don't." But I think, you know, fast forward... I don't know when that was. I think it was 2021. So fast forward two years now, and I feel like not just was I right that Clubhouse failed step by step, because I was like, "This is what they're gonna do. They're gonna realize that they can't grow the thing this way. They're gonna then launch a recording feature because they're gonna say, 'You're missing the live show, just record it.' We're gonna optimize towards people creating shows versus people just hanging out." Then they're gonna try recording, and then no one's gonna watch the recordings. Here's what they're gonna do: they're gonna be like, "We looked at the data, and actually, yeah, people don't watch these recordings because what makes a great live show isn't as good in a well-edited recording." So then they're gonna be like, "You know who really uses this? People who hang out and make friends on this, and we're gonna switch to a hangout product." Sure enough, they switched to a hangout product, and they did basically each of the steps except for the last one, which I predicted was like, "You know, they end up sort of fire selling it to Facebook for, you know, whatever, $70 million," and then he becomes a product manager at Facebook. You know, that part hasn't happened yet, but pretty much step by step. So that one was right but pessimistic. And, you know, I guess one takeaway is it doesn't really matter to be right when it's pessimistic. There's nothing really that great comes of it, you know?

Sam Parr

you kinda look like an asshole even if you're right

Shaan Puri

Yeah, exactly. I'm like, "Oh great, now I'm like, yeah, I told you they would fail." It's like, okay, you know?

Sam Parr

Speaking of things that you say that you don't really mean, did I tell you about that time a kid flew in from England? No? Well, one time when the hustle was getting started, this kid called me from England. He goes, "I love the hustle," and I was like, "Alright, let's talk." I started talking to him, which was bullshit. At the end, I said, "Yeah, if you're ever in SF, just let me know, and we'll help you out." I meant it as a way to end the conversation, and I learned at that moment you should never say that. I get a message three weeks later, and he goes, "Hey Sam, it's the guy from England. My flight lands tomorrow." He just shows up, and we have Hustle Con, my big event. We make him work the whole event, and we're like, "Here, you could sleep on our couch." We dressed him up in a Texas outfit. He had never been to America before, so we gave him cowboy boots and a hat that we had in the office. We called him "Texas Sam" the whole weekend, and he stayed with us for like five days, all because of the phone call. I was like, "Yeah, you know?" So now I don't say those things anymore if I don't mean it. I try to say it.

Shaan Puri

that sounds like an amazing experience it sounds awesome

Sam Parr

paul it was only no it could've been it could've been bad

Shaan Puri

lemonade out of lemons situation for you

Sam Parr

well it it it was it could've been horrible what was the other one you had 2 was it thrasios

Shaan Puri

Thrasios, yeah. So, Thrasios was this company that was buying up all the... it was a roll-up, an aggregator of Amazon brands. Amazon one.

Sam Parr

Of the fastest growing startups ever, I think they went from $0 to a $1,000,000,000 market cap or valuation in like 12 months.

Shaan Puri

And tons of revenue. Then, tons of copycats because everyone's like, "Oh, Thrasio, one of the fastest growing startups in the world! We're going to repeat this."

Sam Parr

we had friends who did it too some of our friends went and did the same thing where they bought a bunch of amazon businesses

Shaan Puri

May they rest in peace, but it didn't work, right? That's the problem. So, you know, I remember calling Andrew Wilkinson and I was like, "Yeah, what do you think about the Strazio stuff?" I was like, "I kinda get it because, you know, they're doing... you know, like roll-ups." I think roll-ups in general are just a really nice blueprint for a business. This roll-up kind of makes sense. Andrew had done a semi-roll-up with Shopify apps, and so I was like, "Do you see this as, like, you know, a really good opportunity? What do you think?" He goes, "I think they're picking up pennies in front of a steamroller." I'd never heard that before, but I guess that's a phrase, like a Charlie Munger type phrase.

Sam Parr

If Andrew says anything interesting, it most likely came from Charlie Munger. That's a zero. Charlie has wonderful phrases, so most of the wisdom he has is from Charlie Munger.

Shaan Puri

And I go, "What do you mean?" And he's like, "It's like picking up pennies in front of a steamroller." You know you're gonna pick them up. You're picking up these little, kind of like what seems like these little cheap, free assets. You think it's all going well until you get completely run over. If you fast forward to today, that's pretty much exactly what played out. These guys bought up a bunch of businesses. They rolled up what looked like a lot of revenue, and then they got run over. At the time, we did an episode, and the things we had said were basically... So I took Andrew's point of view, and I was like, "That does feel more right than the other way." I said, "Well, what could be the problems?" I was like, "Basically, these FBA businesses are not very durable." So if you're gonna do a roll-up, you kind of want durability to be one of the highest characteristics. Normally, in business, we think growth is the best thing, but actually, when you're buying businesses, it's more about not being wrong than it is about everything going right. So you want durability when you're rolling these up.

Sam Parr

They bought trash. They bought like... they would buy like one of the 1,000 vendors on Amazon selling Chinese dog leashes for $25, you know what I mean? Like they... I think they bought trash.

Shaan Puri

So, like, you know, Amazon is not durable for many reasons. Number one, your spot in the rankings for these commodity products really matters. It's a constant battle to keep your ranking high, which includes things like people leaving fake reviews on your product so that your account gets taken down. It's like, "Oh, let me just spam you with reviews so that Amazon detects you and then delists you," right? That's the kind of stuff that happens. Then there are copycats or people who pay more. And then there's Amazon themselves launching basics. For every good category, Amazon's like, "Cool, here's the Amazon Basics." I know, what do you know? It's at the top, right? That was also happening. Then there was the last thing, the sort of death blow, which is Andrew at Tiny. They sort of believe, along with a few other holdco types, that synergies are massively overrated. It's very easy to talk yourself into, "We're going to buy these five companies and then synergy." But it's like, what synergy? It's like, "We're going to centralize the back office and we're going to cross-promote with each other." It's like, no, actually, none of these brands had enough brand love for you to cross-promote anything. Nobody trusted you. The synergies in the back office actually just turned into a bunch of people not really watching what was going on in these individual businesses the way they were when it was just one person owning them.

Sam Parr

so what's the update on them

Shaan Puri

So, Thrasio is basically dead. I don't know exactly what the stage is; it's either a fire sale or bankruptcy, but it's dead. So are all of the aggregators. Now, there's the opposite phenomenon: there's a deloading, which is actually probably a better opportunity. You can go pick the best 10 assets from all these aggregators who are completely underwater, and they just have to, you know, basically get rid of all these assets. So yeah, Thrasio and all the Thrasio copycats did not work out.

Sam Parr

Alright, I'll tell you one that I wasn't exactly right about in terms of timing. This turned out to be true, but it didn't play out how I thought it would. So, something that I've talked to you about since 2019 or 2020 is privacy. If you look back on some of our episodes from when we were still in our old office, this was in 2019. I had this insight from the founder of Pandora. Pandora is the music service, and the founder once told me, "Yeah, many of our users are like middle America, like dentists who have Pandora playing in the background." What we've noticed about them is that they sometimes won't sign up because they don't want to click the link that says they agree to our terms and services and our privacy statements. To me, that meant the average Joe cares more about privacy than a lot of people think. At the time, in 2019, privacy wasn't that big of a deal; you would just click "yes" no matter what. I predicted that there would be a lot of businesses created on top of that. Another example I had was DuckDuckGo. DuckDuckGo is a privacy-focused search engine that doesn't track you in the same way Google does. Their searches have gone up significantly, and the business has gone on to raise $100 million, most of which I believe was from a secondary sale. They're quietly killing it, but I thought this would be more popular than it has been. It's kind of gotten popular because of TikTok. I think in Minnesota or Montana, they have banned or are trying to ban TikTok for privacy reasons. They're mostly doing it because they don't like China, not necessarily for privacy purposes. So, this is where I was wrong. They're doing it for the Chinese purpose, not exactly the privacy purpose. But I thought that by now, this would be a lot more popular than it is. It's slowly growing, but it...

Shaan Puri

not care if you give up all your data but you better give it up to an american company yeah you better

Sam Parr

give it to us yeah so that has that we didn't I I didn't nail that

Sam Parr

yet

Sam Parr

I'm still holding out, but I thought by now it would have picked up a little bit. However, it hasn't.

Shaan Puri

Tom, I'm going to give you one that we got right and wrong at the same time. Meaning, we did an episode back in July of 2020. COVID had been raging for three months, and we did an episode called "Is GPT-3 the Next Big Thing?" This was episode number 94; we're like at 500 now, and this was 94. We had gotten access to this tool called GPT-3, which at the time, you had to get an API key. You had to borrow that; you had to get a friend to get you an invite to get GPT-3.

Sam Parr

and it wasn't that good it was okay

Shaan Puri

We were pretty stunned by it, mostly because we were 12-year-olds. We made it write like a rap song in the form of Cardi B for us, and we were like, "This is hilarious! This is amazing! You just wrote a rap!" Like, this rap is actually good.

Sam Parr

I said, "Write a rap by Cardi B," and the title of the rap was "Walk That Plank." It was very long and had rhymes as if Cardi B was saying it. It was very, very rock.

Shaan Puri

And we were both so impressed. We were like, "This is amazing!" We were basically saying, "Hey, this is super cool, blah blah blah." So, we correctly predicted back in July 2020, before ChatGPT became the fastest-growing product of all time, before OpenAI became a $100 billion company, and before AI was the trend. We released an episode titled, "Is GPT-3 the Next Big Thing?" The answer was yes. However, I count this as a loss. Why? Because we just giggled about the rap lyrics and didn't do anything else.

Sam Parr

we didn't do anything about of it

Shaan Puri

You know, the optimal move was to drop everything and go work for OpenAI. The second optimal move, you said...

Sam Parr

you said in one of the episodes you said if I'm smart I should drop everything and go work in that area

Shaan Puri

And I'm not smart, turns out. Right then, I proved to myself that I was not smart. I could've... there were a hundred ways to make $100,000,000 with this. I could've started a company using GPT-3 as the backbone, which the guys from Jasper did. They were like, "Oh, let's use this to help marketers write blog posts, write tweet storms, write captions, write anything."

Sam Parr

that story needs to play out still though

Shaan Puri

Yeah, but they built a company that became one of the fastest-growing companies I've ever seen. Getting ARR (Annual Recurring Revenue) of over $50,000,000 in one year is insane. So, I could have started a company, could have gone and worked for OpenAI, or could have invested in the OpenAI spinouts like Anthropic, which is now a $20,000,000,000 company. I could go through the list of what else I could have done. Between investing, starting a company, or joining a company, there were a lot of different ways to capitalize on that opportunity that we identified, but I didn't. I think this has happened many times where you sort of see the opportunity—the elephant in the room—and you're just like, "Oh, that's cool. There's an elephant over there," versus being like, "Oh my god, wait! Stop everything I'm doing and let me reassess what I'm doing in order to..."

Sam Parr

do that analogy you kill the elephant are you gonna kill the elephant

Shaan Puri

Look, you know how it is. Those analogies on the fly... sometimes you gotta weave two and two together.

Sam Parr

you kill the we gotta kill the

Shaan Puri

Sometimes the elephant needs to strike while the iron's hot. Now you've got an elephant that's striking iron, right? Like, we don't know what this...

Sam Parr

is in rome my friend

Shaan Puri

It's like that Michael Scott episode of *The Office* where he's like, "Sometimes I just start a sentence and I have no idea where it's gonna..."

Sam Parr

go that's podcasting for you

Sam Parr

Okay, so let me preface this. One of the things I like to take pride in is hiring people before they reach the pinnacle of their career. I also like this on the podcast when we find interesting people and we talk about them. A lot of times they're still popular, but we got them before the curve. One of them was Andrew Huberman. We interviewed Andrew Huberman; I forget exactly when, but I remember when he interviewed us. He was just using his AirPod headphones, looking at his laptop. It looked like he was in a bathroom or something, as if he had run to some room. You know, it wasn't like a big deal. So that one was a cool one.

Shaan Puri

So, I got somebody here that this is all you. You come on the episode one day and you go, "You're this guy, Brian Johnson." I'm like, "No, not really." You're like, "You know Venmo?" I'm like, "Yeah, of course." And you're like, "Well, it's owned by a company called Braintree. You know Braintree?" I'm like, "Vaguely, a payments company, something." And you go, "Listen to this guy's story." So, this guy's story is basically Brian Johnson. I'm not gonna do his whole life story, but it's interesting. Kind of an early door-to-door sales type of guy. He ends up creating a tech company, Braintree, buys Venmo, sells Braintree to PayPal for like $700 to $800 million. He creates this like Neuralink-type brain reader. And you're like, "But forget all that." I'm like, "Forget all that? That was a lot! That was amazing!" You're like, "Forget all of it. Go to this website: blueprint.brianjohnson.com." I go, and it's like size 6 font. It looks like I'm reading from a textbook. And you're like, "This guy is measuring every part of his body, every single organ. He is measuring it, and then he is optimizing it. He's doing crazy stuff. And look at this, he's been doing this for like a year." I had never heard of this. Most people had never heard of this Brian Johnson. Now, I would say, like, I think he's kind of tipped where, like, actually in the tech industry, everybody knows about him.

Sam Parr

yeah and even some mainstream people they'll they'll they'll call him the guy who's trying not to die or something like

Shaan Puri

That... oh, that guy! Yeah, I've seen him. He looks weird, right? Like, I would bring him up in every conversation I could find an excuse to because he's fascinating. People are like, "That's great," but I just don't feel like that's gonna work. It's a very polarizing thing. But you found this early. You were watching him, you were talking about it, and then we got him on the pod early on. We're about to release another episode. I went to his house and we recorded another one. I feel like you spotted this. This was your Uber angel investment. You spotted Brian Johnson way before anybody else was really paying attention to him.

Sam Parr

Let me explain the story. It's been long enough; I can finally tell it. Here's how I found out about Brian. I can't name names, but I have a friend who was going on a first date with this lady he had just met. He goes, "Hey Sam, I'm gonna take this lady. She seems awesome! I'm gonna take her on a first date. I have a little plane; I want to take her up in the plane, and we're gonna fly around. F1, you know, F1 was in Austin. We're gonna go above the stadium. It's gonna be an ordeal. Would you and Sarah like to come on this double date? I would love it if you'd come." We said, "Yeah, sure!" But then Sarah gets sick, and I text him, "Hey man, Sarah's not in anymore, but I'll still go."

Sam Parr

I go 3rd wheel I 3rd wheel on this date

Sam Parr

And we go on this date, and she's a lovely woman. Whatever. I wasn't trying to be cool, but I was trying to hype up my buddy. I go, "Hey lady, have you ever been in a plane on a first date? This is pretty cool." She wasn't trying to dampen the mood or, you know, rub it in this guy's face, but she goes, "Oh yeah, you know this other guy I used to date? He liked to fly." So we asked a few more questions, and we're like, "What does he fly?" She named some jet that's like a $40,000,000 jet, and we're like, "What?" Then she says something like, "Yeah, but he likes to fly it himself, but he has a staff." We're like, "Who the hell is this guy?" So I Google who this person is, and that's how I find Brian. It was she used to date him, and that's how I find out about him.

Sam Parr

but I just start googling and

Sam Parr

I came across a blueprint that he just launched a few weeks prior, and I'm like, "Right, this guy's amazing." That's how I found Brian Johnson.

Shaan Puri

how did that date go though

Sam Parr

it didn't work out

Shaan Puri

decision by you to join the date

Sam Parr

I'm like I joined the date dude it's them it's them 2 in

Sam Parr

The front two seats and me in the back. I have the headset, but I'm like putting my hands over there, like, "Hey guys!"

Sam Parr

it was so

Sam Parr

Funny, I had never been up in a plane like that. I was like, "Can I pass this up? Can I still go?" And I was pumping them up the whole time.

Sam Parr

I was like, "Hey guy, have you told the lady about that one time you did this amazing thing?"

Shaan Puri

But you're doing it through the plane headset thing, which is like you have to yell. Yeah, but I'm still leading up like, "Hey."

Sam Parr

Hey, how about the... yeah, did you tell her about the time that you paid for everyone's dinner? It was $2,000, Roger.

Sam Parr

yeah I'm like I'm trying to like pimp them up while I'm wearing this headset

Shaan Puri

you're like pointing I was like hey we could go there next week yeah

Sam Parr

Or it's like, "Hey guy, did you tell the lady about the time that you had the box seats at the F1 and you took all of your friends because you're so nice?" Yeah, it was like that type of thing. It didn't work out though. I tried my best, guys. I'm sorry. You know who you are if you're listening to this.

Shaan Puri

That's hilarious! You had a couple more on here. I don't know if you have time, but you had a couple more in here that looked kind of interesting. So, you had "do paid communities," and then what's this "inertia" one?

Sam Parr

Let's do **inertia**. Okay, so you... you talk a lot, that's no surprise. But every once in a while, you say something that's pretty profound. One of the profound things that you said that stuck with me was in March of 2021. You had this episode called **Inertia**, I believe, and you said, "Inertia explains why 90% of people are doing what they're doing." In my life, I've had moments where I realized **inertia is a bitch**. Inertia is the reason why I'm doing these things—not actually because I want to, but because of inertia. Oftentimes, I've got to check myself and ask, "Am I really doing the right things?" I think you were referring to a business that you had previously sold, where it wasn't doing that well. You asked yourself, "Do I even believe this is a big opportunity? Would I even be doing this if I weren't already doing it? Would I have hired these same people? Would I work with these same people?" The answer at the time was **hell no**, and that's when you decided to get out. So my question is... no, question comment: that was good. That was a really good insight. But question number two: you've since sold a business. So you started and sold a business, I think, post this comment.

Shaan Puri

yep do you

Sam Parr

still you like do you still think about inertia

Shaan Puri

All the time. And by the way, this came to be about **inertia**. Yeah, it's like the Roman Empire for some guys. For me, it's inertia. This happened because I had a "come to Jesus" moment. I was with our buddy Sully, and we used to go to San Francisco. If you drive like 30 minutes down south out of San Francisco, there are these casinos that are like half casinos.

Sam Parr

yeah

Shaan Puri

So, we go down there and we're hanging out. We're playing, we're having a good time. At the end of the night, he's like, "So, why are you...?" He's like, "I don't get what you're doing." I go, "Like casino? What are you talking about?" He's like, "No, no, no, this whole thing." I was at Monkey and Fredo at the time, and to the outside, what I was doing was the greatest job ever. If anybody had ever seen... you've seen our office at Monkey and Fredo. It was literally the nicest office you have ever been to in your life.

Sam Parr

I called it a billionaire's playground is what it was

Shaan Puri

And that's what it was. He literally built his dream office as a billionaire, and we just got to use it. There's a chef every day, and there's a gym. But it's like for only the 15 people that were there. It was very exclusive.

Sam Parr

You had 20 or 15 engineers who were paid really nicely, and you could just do whatever you wanted.

Shaan Puri

And the job was, "Sean, you get to come up with any idea you want. Here's a team of super talented engineers to build them and designers. Here's the funding; you never have to go raise funding. You get paid a salary and you own the equity." By the way, you don't only want to focus on one. Go ahead, do four at a time. Fill four at a time. You give us enough resources; go ahead, do everything right. I’m 25 years old when he, 24 years old when he names me CEO. At 24, that was the greatest opportunity, the greatest experience ever. At 25, it was an incredible opportunity. Then I was 29, and I was still doing the same thing, except for now the pressure of succeeding. At the beginning, it was like, "Dude, this is gonna be awesome! We have so many shots on goal; we're gonna do it." We took a lot of shots on goal and made some good things happen, but no big huge win, which is what we were all going for. By the end, we were really trying to force a square peg into a round hole. It just wasn't working. Our mandate was like, "Build the next Twitter, build the next Snapchat." It's like, "Dude, that's really fucking hard to do." But, okay, we're gonna keep trying. So I got this talented team in this beautiful office. I'm CEO, I'm getting paid well, I got equity, I got everything you would want. And here's my best friend, the guy I looked up to, saying, "What the hell are you doing?" I was like, he's looking at me like I'm a junkie, like, "Dude, what are you doing with your life?" And I'm like, "What are you talking about? This is amazing! Of course, this is amazing!" Right? And he's like, "You told..."

Sam Parr

I remember you telling me how much money you made back then. I think it was like low six figures. It was over $100,000 but less than $200,000. I remember when you told me that.

Shaan Puri

I was like

Sam Parr

I was

Shaan Puri

making 1.60 at the time

Sam Parr

Yeah, I was like, "That's the most money of anyone I know." Like, do you have $100,000? That way, it was huge. I remember you told me that amount, and I was like, "You're..."

Shaan Puri

So, this was huge to me too. I was like, "This is amazing!" Then I thought, if any of these ideas hit, this would be great. He was talking to me and said, "I feel like you're just doing the same thing over and over again and not getting the results you want." He basically asked me a very simple question: "If you weren't already working on this project, if I just took the project away, if tomorrow this whole company had to fold because they forgot to pay their bills, and whatever, this folded tomorrow, would you pick up the phone? Would you call these same people and say, 'Hey, we're still doing this idea, right? That's the biggest idea we could possibly think of. It's the one we must do.' Would you call these same people to work on the same idea?" My answer was, "Yes, the same people." But I said, "Hell no, not the same idea." He responded, "That's kind of a shitty realization to have." I thought, "Am I an idiot?" He said, "No, this is common. Inertia is a bitch." He explained that almost all of us are just doing what we're doing because we were already doing it. This even happens with investments. After we got acquired, I received a bunch of Amazon stock, and my portfolio was super skewed towards Amazon. All of a sudden, I had $1,000,000 of Amazon stock. If you were just giving me $1,000,000, I wouldn't have put all of it into Amazon. But because it was already there, I thought, "Should I sell Amazon? I don't know, it's a good company." Because it was already there, my decision was totally different than if I had just re-underwritten the decision from scratch. I asked myself, "If I just had this money today, is this exactly how I would allocate it?" The same thing happens in your portfolio as happens in the time of your life. Would I allocate my energy and my talents to this project, or am I just doing it because I've been doing it? Am I just doing it because that's what I'm already doing? I think the sad answer is that for most people, they're doing what they're doing because they're already doing it. It's not the thing that, if they had a blank slate today, they would just go back and recreate.

Sam Parr

That's the same argument my wife gave to me about selling HubSpot stock. I've not sold any, and she was like, "Well, would you buy this stock anyway?" My argument was, well, first of all, I do like the company, but do I like it enough to have that much of my portfolio in it? I don't know. But my argument is, well, I don't want to pay taxes, and frankly, I'm not sure if that's a good argument or not. But I am a victim of it as well.

Shaan Puri

Yeah, of course, there are nuances to some of these things. But that same principle applies to a lot of parts of your life. A lot of people are in relationships they don't want to be in because they're already in a relationship. They're in jobs they don't want to be in because they're in it. I just kind of had this moment. It was 2 AM, and I'm in this Chinese casino. My friend is telling me this thing, and I remember we drove to our office, badge in, at like 2:30 in the morning. We went to the whiteboard and said, "We're going to spend the next hour trying to figure out if we can actually make this company work." If at the end of this hour we don't look at a plan on this whiteboard that we feel is going to work—like, I believe this is worth a shot—then I'm going to sell this company tomorrow. I'm just going to get out of this company. At the end of that hour, we looked at it and thought, "These are all just random long shots. We can't sit here and say we have a ton of conviction in this." The next day, I talked to our main investor and said, "I think it's time to shake it up. I need to shake up something in my life. This is all beautiful; this is amazing. I can't believe you gave me this experience, but I don't want this anymore. Let's either sell the company or you should replace me. Something's gotta change." I can't unhear what I heard last night. I have a lot of flaws, but the one good thing I have is that once I hear the truth, I just act on it. I agree that I've heard the truth now, and that's it. There's no going back from that. Whereas I think some people will see or hear the truth and then go into denial or delay. I don't do denial or delay.

Sam Parr

That's a good one! Yeah, I always thought that that line, "Inertia is a bitch," was memorable. I had to bring that one up. Maybe the last topic is paid communities. I've been interested in that. If you listen closely over the last 550 episodes, there are about 2 to 3 things that I've been obsessed about. I knew I was going to act on one of them, and I acted on one of them—it's a paid community. So, by the way, I...

Shaan Puri

think can you say the 2 or 3 what are the what what would be the 2 or 3

Sam Parr

I I helping people find jobs so I call it job boards it's beyond that but I've always been fascinated by that and then creating like somewhat related but I was I've always been fascinated by the trucking industry or other like blue collar essential jobs that aren't don't have a lot of technology or software in order to help them be more efficient so those are like 2 or 3 things that I've always really liked and then of course b to b media companies and database and research businesses but the other one that I really loved was paid communities and if you listen closely starting in 2020 I did a lot of breakdowns on different paid communities so I mentioned tiger 21 vistage which has since sold so I I talked about vistage a lot of people didn't know what vistage is it's like similar to what hampton does similar to what ypo does but the target market is ceos and business owners of like plumbing companies in the in middle of america doesn't sound that huge but it has since sold for about $1,800,000,000 I think about 8 or 10 months ago it was do and now it's doing close to $500,000,000 a year in sales very profitable and so I talked about paid communities and I talked about tire 21 a few other ones here's the I I made a list of pros and cons back in 2020 so this was march 2020 and I'll tell you if I think the pros and cons are true since I've now run hampton for about 1 year so pros of page paid communities they can grow quickly they seemed fun to run if you're interested in the topic you don't need a lot of money to stardom they definitely seem profitable and then the cons were a lot of times they don't scale that well I think churn could be pretty pretty high and those were like my 2 main cons so the truth is is that they can grow quickly but you don't want them to grow quick quickly you want them to grow slowly so I was a little bit wrong about that can you start them with 0 money $0 yes I started hampton with no money we didn't even buy a website or a domain name can they be very profitable yes the answer is yes they can what I got wrong or didn't mention was how meticulous you have to be about growth and they can get big but they just take longer and that's okay because I think if they take long usually not always if something takes longer to grow maybe that means that it's gonna die it has is less likely to die quickly example thracios grew quickly probably is gonna die very quickly there's a lot of examples of that and so it has in fact proven to be a big business or it can be a big business it's harder to grow than I thought but not because of demand but because you don't want it to grow quickly you need it to grow slowly and to be really thoughtful so I underestimated how challenging that is but I did a lot of the work in front of people I I I would have thought that someone was gonna launch this I even interviewed the

Shaan Puri

Funny thing is, you invited a couple of other paid community CEOs on the pod as guests. You asked them a hundred questions and then took their lunch. I just find that to be an incredible story that I look forward to telling as this plays out.

Sam Parr

I needed to work. I need to work first. At the time, you had a community called Club LTV, which was an e-commerce community. I think it was making $100,000 a month pretty much right away. I think that name is wonderful.

Shaan Puri

It was free; I didn't charge for it, but it was invite-only. I was running an eCommerce business part-time, and I had never done eCommerce before. I have a strategy: if I'm going to do something that I don't know how to do, there are hacks to learn faster. One of the hacks is to surround yourself with other people who are playing the same game at 1 to 2 levels above where you're playing it. This means they are 1 to 2 notches better at it than you are and further along than you are. When we wanted to grow big on Twitter, I think both of us had a similar idea. We created a text message group called the "100K Club" and invited six people who all had that same goal. Initially, we talked about the stuff we were doing to make that happen, and then we all just became friends. Immersion into a small club of people who are playing the same game at a 1 or 2 notch higher level than you is one of the hacks to get better at something faster. So, Club LTV was cool. If I just create a curated group of awesome eCommerce owners, I'm going to learn a bunch of things that I need to know to make my own thing successful. I'm not even charging these people because I don't need to make money off this; I want the information. I actually wanted the network from it, and that's exactly what I got out of it.

Sam Parr

But you made money through advertising, and so you have sponsors. Yeah, and that model actually works. There's a company called Aventa that does this, but they did it with Chief Information Officers. These are like Fortune 500 companies, and they sold for 17 times profit for $250,000,000. So, they were making, I think, $50,000,000 in revenue, and then whatever that profit is... I can't do that math. So, that model that you had works. The downside, which I don't think you knew getting into it, is that logistically, it's a very operationally heavy business. It's very, very challenging. E-commerce is also operationally heavy, but it's more so like there are 3 or 4 things that you have to nail with people. There are way more things; there are people's feelings that you have to account for. It's a little bit more of an art, and it's actually quite challenging to hire help for that type of business. But you were on to something, and I actually think Club TV...

Shaan Puri

I think that one was a business that could have totally worked. Ben and I had a conversation like, "Hey, do we want to actually turn this into a business? It can work; it would be profitable." We just saw better opportunities for ourselves. But that's one where, if I knew the right person, I would have totally just handed over ClubLTV and be like, "You're the operator of this now." There's a clear path to make this a business. There's one called Ecommerce Fuel that's out there that's kind of like the older version of... I love it.

Sam Parr

this paying subscriber really

Shaan Puri

why why why did you you didn't do ecommerce I just thought it

Sam Parr

Was awesome! Andrew, the guy who started it, I used to read his blog and I thought it was sick. It was $300 a year. I think he listens to the pod, and I talk to him every once in a while. I just thought it was cool. I thought the eCommerce field was great. In fact, I was a paying member. Moiz Ali, this very rich, successful guy—sorry Moiz, I'm going to blow your cover—he used to use my account because he didn't want to pay $300 a year. We would share a password, so it's pretty funny. But I liked eCommerce too; I thought it was great. It's still a thing, and he limits it to 3,000 people, I think, right?

Shaan Puri

Something like that... I don't actually use it because it's a forum, and I don't really love forums. There are live events or whatever, but I liked the way we did it with Club LTV. I thought that was more fun and easier—just easier to actually participate in. So, anyway, I thought that, yeah, that definitely could have been a business. You know, you gotta pick and choose opportunities. So, long story short, what do you think is the takeaway from this? We made a bunch of predictions, and we can go back, look, and see what we were right about and what we were wrong about. What's your answer to the Chris Barling question that I love? What's the right lesson to learn out of this?

Sam Parr

The right lesson to learn... there are a few. The number one is, we make money talking about this stuff, and that's great. You could say we make a great living doing that. I feel like a pushover for not acting on some of these things. I guess I acted on one, but there have been five, ten, or even twenty things where you've told me, and I'm like, "That's cool, I should go in on that." Mainly, there have only been three things that I've gone in on, which is TRT. But, like, we talked about OpenAI. We should have put our money... I think you have in a few cases, but I should have put my money where my mouth was a little bit more. So that's one lesson: predictions aren't that easy, or aren't that terribly hard. Having the courage in them is hard.

Shaan Puri

Mine is the exact same thing, which is that the predictions that matter are the ones where you notice something early, before everybody else does. But then, you know, that's kind of cliché, right? Ideas are kind of cheap. No, no, the idea is actually quite valuable. However, it's potential energy. You gotta turn the potential energy into kinetic energy. How do you do that? Through motion, right? So it's like chasing it down and actually doing something with it is where all the value gets created. Ben and I have actually figured out a little bit of a better way to do this, both through actually having vehicles to invest in these things, but also by continually stopping and asking ourselves, "I think in the last six months, there have probably been two or three times where we said, 'What's the thing that we see right now that three, four years from now, we're going to be like, dude, we talked about that? That was in front of our face.' So why didn't we just go and meet the guy? Why didn't we go and invest in the thing? Why didn't we start one?" Whatever it is, right? By asking that question regularly, like, "What's the thing that's actually hidden in plain sight right now for us?" I think I'm going to turn that dial from missing a bunch of these opportunities to taking advantage of them.

Sam Parr

we should do a whole episode on what those things are

Shaan Puri

yeah yeah I will I'll I'll tell you the way I learned that by the way was I met this guy anamitra and anamitra came to my office and he was the first product manager at twitter and I was like tell me what it was like back then he was like well it was like I don't know 12 people in the company I joined 15 people something like that I joined and I was like was it obvious at the time that like twitter was gonna become twitter he's like no no no no not at all like twitter was kinda interesting but looked pretty frivolous and useless people were texting out like what they were eating there was no app at the time it's just you just texted this number like 44444 or whatever like whatever you're having for lunch and in silicon valley people were like kinda having fun with it a little bit but it didn't seem like a serious like he's like I had like job offers from Microsoft or whatever like I had serious opportunities and then here was this like twitter thing even the name sounded frivolous and he's like but I had learned one important lesson which is that whenever you see like a phenomenon of behavior meaning you see people acting in a way that seems strange weird or inexplicable or irrational the natural reaction is to just write it off be like I don't know those are weirdos that that makes no sense idiots and move on and he's like what I've learned is now he's a vc he's like as a vc and as at the time and he's like thank god in my career I I realized that which was when you when you see that weird behavior that you don't understand the thing is not to the thing not to do is label it and write it off it's to lean in and try to understand it it's like so I saw that people were like like why would you text out what you're eating right now like what do you why and why do why do you like to see what other people are saying in that same way like that seems completely like strange behavior but people are doing it and he's like anytime you see strange behavior and people doing it like that's usually the the inner that's what an amazing opportunity actually looks like and since he told me that I then saw that many times over like we got acquired by twitch I remember in college walking into my dorm room the guy next to me who who lived next to me and he was watching a like a replay of someone playing a starcraft tournament and I was like you are king dork not only is starcraft on your screen right now you are not even playing you are watching some guy in korea play this game that is literally like the dorkiest dumbest thing I didn't and I literally made fun of him for for like a year later when we got acquired and he's like oh you're head of esports at twitch now he was like he literally was like you fuck he called me and he was like you used to make fun of me for this and I was like dude I agree I was totally dumb and wrong I should've been

Sam Parr

I I don't even play games but I watch people on youtube playing

Shaan Puri

Yeah, and I was like, "I should've leaned in." Why would somebody do this behavior that seems completely irrational? Why would someone watch another person play video games on the other side of the earth through this replay that he had to download? At the time, there was no Twitch. He had to download this thing off the server for 8 hours and then watch it at night. I was like, "Weird, I don't want to hear it." Then, of course, you know, missing that 5 times has taught me to lean into that. I just remembered the OpenAI example, by the way. Sam Altman, president of Y Combinator (YC), right? He had the best job in Silicon Valley. President of YC was the best job in Silicon Valley at the time. YC was probably the most value-generative organization at that time. He was the president, picked over anyone else, and he left to go join an AI nonprofit.

Sam Parr

I was like what yeah I know like something sums up

Shaan Puri

These billionaires are putting $100,000,000 into this AI research company, this nonprofit. Why would they do that? And again, I was just like, "Weird, Sam's doing a weird inexplicable thing." Instead, I should have been like, "Hey, the smartest guy in Silicon Valley just left the most prestigious job in Silicon Valley to do this thing that sounds sort of strange to me." Lean in. Yeah, that's the lesson I would share. My takeaway of this whole thing.

Sam Parr

Let me wrap up with one quick thing I forgot. I should have said this earlier, but we did this episode about this guy. I think he was in India, and we called him in. He talked to us without his video on. I found him because he had this website called Uber Pro. I think it was called uber.pro. I Googled his name last night, but I can't find him anywhere online.

Shaan Puri

oh he's gone

Sam Parr

I can't find him anywhere, and if anyone can find him, please do. This would be amazing! I want to see what he's up to now. He was 23 years old or even younger. What I did was I gave him $1,000, and he gave me $10,000 in Uber credit. For years, I took an Uber Black everywhere. What he did was he found all of these Indian kids in his town. When you rode Uber for the very first time and referred people, you got $25 in free credit. Somehow, he made it so he could convince all these kids to take a free Uber to get $25 in credit and to continually refer themselves. I also think he ranked really high on Google for "Uber discount code" or "Uber promo code." He accumulated millions of dollars in Uber credit, and you could buy the Uber credit from him for 10 or 20 cents on the dollar. I found this website, and I was like, "I'm doing this!" I bought, I think, $1,000 worth of Uber credit. Then, you had to change your iPhone from America to Moldova. Your Uber account had to be in Moldova, and that was the loophole. He was making a lot of money doing it. For an Indian guy in India, who was making thousands of dollars a month, I think on the side he was like, "Yeah, this is so much money." I think he was making $30 a month. I've always wondered, what is that kid up to? I wanted to know where he is now.

Shaan Puri

We're having him on. He was fascinating. That was a great arbitrage that the guy had architected for himself.

Sam Parr

Very... I don't know if it's illegal, but it's definitely against the rules. It's questionably unethical. But when you see things like that, they're going somewhere. I've always wanted to know what happened to that guy.

Shaan Puri

I want to leave you with two of the kind of... do you know what I talked about? Like, why am I hearing about this three times? Don't just ignore this. I'm training my brain to not ignore these signals. Now, I'll give you two of them. For people who made it this far in the episode, these are the gems. This is the part where you're like, "Holy shit! I can't believe they saved this for the end," which is basically the two trends that I see right now that are strangely big. Go to character.ai and pull up how much traffic you see that that website has.

Sam Parr

Oh my God! I would have thought like $10,000 a month. And what's the real... oh my God, so $200,000,000?

Shaan Puri

Exactly 200,000,000. What this is like, you could go to the Wall Street Journal, and it won't have 200,000,000. You could go to the New York Times, and it's not going to have 200,000,000. This is...

Sam Parr

no media site has that and it has an average visit duration of 33 minutes

Shaan Puri

It's beta.character.ai. Okay, so I've been on this podcast talking about AI. I've been discussing platforms like OnlyFans and the crossover between AI and this AI OnlyFans concept. I'm looking at investment opportunities in this space. There are so many companies that are doing this "chat with an AI" type of thing, like Replica and Character AI. I never thought...

Sam Parr

that would be a thing

Shaan Puri

They all have ludicrous traffic. We called it, by the way. We talked about Replica, like a year ago—girlfriends, AI, virtual girlfriends. Exactly. And that's a lot of how people use this character AI thing. They kind of chat with the chat. I think it goes into the gray area a little bit.

Sam Parr

I mean, it's a lot of smart people like Einstein, but the top person is Ariana Grande and Billie Eilish, and then like some K-pop lady. There's probably a...

Shaan Puri

a weird thing on the phone willing to chat with ai for a really long time so easy to write off as weird loser but it's it's my friend watching starcraft tournaments in the room next door right dork king dork behavior I will not make that mistake again this is deaf this is definitely something I don't think that these companies necessarily are the winners but like you know every every product there's a kinda like the wave 1 of attempts wave 2 of attempts wave 3 and then finally there's like the last mover right the the last mover who actually nails it and builds a full on product around this and so there's something in this space that's like ranges from companionship to naughty chat that like with ai that's gonna be massive because the numbers are off the charts the behavior of the strange thing is off the charts okay that's 1 second 1 which is less crazy is there's a bunch of really smart people that are now have a new business strategy and their business strategy is to buy wounded unicorns and so heard it once heard it twice heard it three times first heard this from andrew wilkinson andrew wilkinson he he called me back couple years ago I was living at my old house in san francisco and he I remember him telling me you know what I would do if I was you is I would find one of these startups that's raised venture capital but is not gonna become a $1,000,000,000 company but they got to 5,000,000 in revenue 10,000,000 in revenue and you could buy these for cheap because they don't have a they can't raise their next round and there's no way out and so there's not really like a a good exit market for that group and those people don't wanna like fire a bunch of the engineers stop paying high prices for their san francisco office space and like become profitable they could in theory but they're just not gonna eat shit in order to do that they're just gonna shut it down return investor money sell the assets to whoever and they're gonna go start their next company or go get a job he told me that first he had then done that with a company called meteor so meteor was this developer framework and I think he bought a company that was doing like 5 to 7,000,000 he was doing like 5,000,000 + in revenue for like one x revenue or I don't know it was like some like ignore the multiple or the exact multiple times

Sam Parr

I think they very I think they raised $30,000,000 or something

Shaan Puri

They had raised a bunch of money. They had customers and revenue, but it just wasn't going to be the next big thing. In venture capital, this is often referred to as "become the next big thing or bust." What he realized was that if they bust, we could pick up some of these assets. Andrew had said it, and then you hear other people talking about this who are doing it. Our friends Xavier and Siava are doing this right now. If you're driving to San Francisco, there is a billboard with their company that says something like, "There's never too late for a second chance." Honestly, it looks like a divorce lawyer's advertisement because it's KJ with her arms crossed, and it says, "There's always a second chance" or something like that.

Sam Parr

and I

Shaan Puri

don't know what

Sam Parr

the billboards they look at

Shaan Puri

the billboard entering san jose

Sam Parr

you know

Shaan Puri

Like when you come in on whatever the 101, it's right there. It's basically saying, "Don't just shut down your company; sell it to us." So, they're doing this. Jeremy Giffen came on "Invest Like the Best" and he was like, "Yeah, I think one of the big opportunities right now is to do this." You hear this four or five times from smart people. You gotta be an idiot to not realize that there's probably something there. It's not like you're hearing it from the news or the hype cycle type of things. It's your smart people mentioning these opportunities in passing. But it's not consensus yet. You realize, "Oh, that's probably one of these, like, what I call value spots or fat pitches." So, what are the big fat pitches that you could go swing at? You don't have to go swing at it, but you should identify that at any given time, there are a couple of fat pitch opportunities that you could be going for. That's one of them.

Sam Parr

I wanna learn more about it I wanna how do you find I mean I wanna know I've got questions like how do you find them

Shaan Puri

just run it handy bro don't don't even don't even think about it just keep running it handy you already got your fat pitch

Sam Parr

well

Shaan Puri

by the way love saying fat pitch by the way just a fun fun phrase to say

Sam Parr

yeah I agree that is a good one it's a good one would

Shaan Puri

you steal

Sam Parr

it from ted teddy williams

Shaan Puri

warren buffett

Sam Parr

who stole it from ted williams

Shaan Puri

who does

Sam Parr

I know he said it in his biography. I know.

Shaan Puri

hard to say

Sam Parr

no it's I said it very easily alright that's the pod