How To Make $25 Million With A Niche Hobbyist Magazine (#419)
AI: [{'type': 'text', 'text': '\nAI, Cookies, True Metrics, and Underutilized Assets\n - February 14, 2023 (about 2 years ago) • 59:53
Transcript:
| Start Time | Speaker | Text |
|---|---|---|
Shaan Puri |
And again, remember, a percentage of their readers are ultra-wealthy people who are like, "Yeah, great! I want to have a home on the East Coast that I could park my private plane in, and that'll be one of my hubs."
I'm pretty sure... okay, I don't know the exact numbers on this, but I can triangulate a little bit. I think they've done at least $25,000,000 in presales on this thing.
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Sam Parr | that is crazy and it | |
Shaan Puri |
It could be... it could easily be double that. But that is a really awesome and impressive way to take this niche hobby, find a kind of media publication that works, and go from content to commerce.
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Sam Parr |
I have some stuff for today. You have something that I know about that I've kind of mentioned, but I mentioned it without saying their name. Craig Fuller... now we can mention it.
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Shaan Puri | let's talk about it | |
Sam Parr | did you did you get permission from of about this | |
Shaan Puri | Yeah, I think so. So, we got some of this is public, but let's talk a little bit about this.
Okay, so there's this business called Flying Magazine, or Flying Mag. When you look at it, you're like, "Okay, well, what is this?"
Basically, the story is there's a guy who bought this magazine called Flying Mag. Flying Mag produces this beautiful magazine with amazing photos. If you're a flying or aviation enthusiast, you will love this magazine. He bought it for, I think, not quite $10 million, but a little under that. So maybe somewhere between $5 million to $10 million.
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Sam Parr | My guess is a fraction of that. I think it was closer to 1. Do you have any... any?
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Shaan Puri | we got a little source here saying high 7 figures | |
Sam Parr | so let's let's assume the source is correct | |
Shaan Puri | Okay, so I was wondering, where did this person get high seven figures to drop on a magazine? That seems like a pretty indulgent purchase for someone unless they have a lot of money.
He started a company before that called FreightWaves, which is basically a data company for the freight shipping industry. They are a price reporting company, providing data that shippers and freight companies use to inform themselves about what's going on in the market.
They also have a SaaS tool, so they kind of have a media side, which is the content they're producing that includes pricing information. Then they have a SaaS business called Sonar that's involved in it. They've released a public press release, so you can kind of see some phone numbers.
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Sam Parr | I saw they did that that's very weird that they did that | |
Shaan Puri | Yeah, they're not a public company, but they sort of did a public report. I'm not sure what the agenda was. I think I'm just sort of naive here. I don't know. Normally, this is, "We want somebody to buy us," or "We want to raise money," or "We're prepping to go public." But I don't think it's any of those three because of what they said.
So, they basically reported $13,000,000 in revenue for a quarter. Let's call it... let's just extrapolate that out in a straight line, so roughly $50,000,000 a year in revenue. It wasn't a lot in profit; it was like, you know, $1,000,000 or $2,000,000 in EBITDA in the quarter or something like that. So, let's say that this business is making, I don't know, $4,000,000 to $8,000,000 of profit a year. | |
Sam Parr | but it's growing 70% a year it's growing quickly almost a year | |
Shaan Puri | Been around, I think, for a little while. So, you know, done well. They had $28,000,000 in cash just like it on the books, on the balance sheet. So, you know, the business was in a healthy spot.
I think Craig starts FreightWaves. He then separately buys Flying Mag. One of the interesting things about Flying Mag is that if you think about who are the readers of a niche magazine like this, you have two categories: uber nerds and uber nerds who are rich. Because, you know, you gotta be kinda nerdy about this hobby if you're gonna be reading about this.
We had a guy once who we hired as an engineer. He used to have an app on his phone where he would listen to... what's it called? Air traffic control. He would just tune in to the frequency of air traffic control and listen to it at lunch.
I gotta tell you, I never had a worse lunch with anybody in my life. You know, it was just me, him, and his phone on with air traffic control during our lunch. I was like, "You know, hey man, I'm gonna go back for seconds and then I'm gonna go kill myself." So, yeah, see you later. This has been horrible. Thanks. | |
Sam Parr | I do I do that with the I do that with the police scanner you ever do that with the police scanner | |
Shaan Puri | At least police look... There's a show called *Cops*. There's no show called *Safe Landings* because that's all air traffic control is. There's no show called "Which way is the wind blowing?" | |
Sam Parr | but there is a video game called that there is a video game where all you are is an air traffic controller | |
Shaan Puri | Yeah, fair enough. Okay, so anyway, back to my flying magazine story. A big percentage of the readers are like rich people with private planes. You see this a lot in tech for some reason. My buddy Furcon did this; he sold his company and immediately signed up for flying lessons. He wants to get his pilot license to fly a 5-seater, 6-seater, or even a 2-seater plane. They love that hobby, and it's a really expensive hobby.
One thing that they did recently that I think is really smart is... have you heard about this community that they're building in Atlanta?
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Sam Parr |
So he told me, "I'm not gonna steal your thunder," but he told me what he was gonna do. He goes, "I'm flying from New York to go see this property I'm looking at, and I'm flying my private plane. Do you wanna come with me?"
I ended up not going because I had to go up to Teterboro [Airport] in New Jersey and then fly back down to Atlanta to see the spot with them. But he asked me to go with him, and I almost did it. So I've known about this for about a year and a half now.
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Shaan Puri |
Yeah, that's so... The interesting thing is they're basically building a community in Atlanta. I think the reason people build these communities is like there's a... what's it called? Like a landing strip in the middle of the neighborhood. So you could park your plane, and if you want to take off, you could just go take off. It's like the driveway of the community is a landing strip. Correct me if [I'm wrong].
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Sam Parr |
I'm wrong. It's... it's a country club with homes around the golf course, but instead of a golf course, it's a landing strip. That's exactly what it is. So it's a country club for flying.
You purchase a plot of land (I forget how much it costs), and then they build you a home. Now you are part of this aviation community.
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Shaan Puri |
Right, and so they presold the plots of land or the plots for the homes in this community. They find this kind of bare ground or whatever, they start preselling the plots, and again, remember a percentage of their readers are ultra-wealthy people who are like, "Yeah, great! I want to have a home on the East Coast that I could park my private plane in and that'll be one of my hubs."
I'm pretty sure... okay, I don't know the exact numbers on this, but I can triangulate a little bit. I think they've done at least $25,000,000 in presales on this thing.
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Sam Parr | that is crazy and it | |
Shaan Puri |
It could be... it could easily be double that. But that is a really awesome and impressive way to take this niche hobby, find a kind of media publication that works, and go content to commerce. This is what the Chernin Group believes in - the content to commerce model. So they did Barstool [Sports], for example.
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Sam Parr | which is what hodinkee did | |
Shaan Puri | Hodinkee did this for watches, right? It's a watch blog for super high-end watches. Well, guess what? As soon as you start selling watches, that business... I think Kevin Rose came on this podcast and said it went from $1 or $2 million a year in revenue to $100 million when they flipped that switch and started actually selling the watches they had been talking about for 15 to 20 years.
So, content to commerce is this kind of really interesting play, and I think that this is a great example of it being done well.
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Sam Parr |
Yeah, look, you have BuzzFeed doing it with stuffed animals, which is pretty lame. You know, they did that with... like, they did it with houses. And this is *baller*. Craig told me about this about a year and a half ago, and I was like, "This is very bold." He was explaining it to me, and he was very confident. It was like, "No, no big deal."
I was thinking about this, and I was like, "I don't know, this kind of seems like a really big deal." To come out... we should do [it].
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Shaan Puri | well I was | |
Sam Parr | Was like, "I don't think you're gonna be able to pull this off." Well, I didn't say that, but in my head I was like, "This is ridiculous." He totally did. He totally pulled it off.
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Shaan Puri | We did this way back in the day. I think you had said something like, "Ads are lame." This was before HubSpot bought the podcast. So, it was basically like, "Ads are lame. We're selling ads on the podcast, but what would be a better business for my first million to do?"
At the time, people were suggesting that I should create a WeWork-like branded version or a white label co-working space or something like that. It sounded crazy, but I actually think there was a version of that that could work.
Basically, if we just bought an 8-unit or 16-unit apartment building in San Francisco, but you could only rent there if you were part of our community, or you could buy units there if you were part of our community, something like that could work. People would rather live in a community of like-minded individuals than in a community of absolute strangers.
I think there's a huge number of people that would do that. Then you get into the real estate game. These units in San Francisco go for, you know, $1.5 million to $2 million on average. So, you could do these things where, in theory, a brand like ours could also say, "Yeah, if you want to be around other entrepreneurs, other business people who share this kind of ethos that we have, then you could do that."
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Sam Parr |
But there's a problem, which is... you and I - I don't know about you, but me? I wasn't even bold enough to consider that. I thought it was stupid.
Now I've got a little bit more experience and I kind of understand our pull a bit. Now I actually think that could work. But at the time, I was like, "That's ridiculous. There's no way that would work."
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Shaan Puri | Dude, my brain is like a metal detector that's just looking for something that's going to scare me to do. I'm just like, where can I get the maximum thrill? The business thrill.
Like, we're going to get the maximum reward, and I'm down with the risk. If I said out loud that I was doing this, I think it would get other people's attention, but it would also make me a little scared because I don't know exactly how to do it.
I am very attracted to these ideas, and that's not always a good thing. I think that's a bad thing in many cases. But I hear that, and I want to run into that fire a little bit. Whereas I think you hear that, and you're like, "There's a fire? Why would I run?"
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Sam Parr |
No, no, no... Now I'm more comfortable because I've seen some... I've seen like, "Well, if you do this, this, and this, the odds of some type of return is positive." But before, I was still kind of understanding the mechanics of business and investing and things like that. Now I actually do see it.
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Shaan Puri | We're like opposites. I get excited by that weird kind of half-figured-out thing, and you're like, "Well, why don't I figure it out first?" But then once you do figure it out, you're locked in. You just execute and go on that opportunity.
Whereas I'm like, "Oh, this is cool. It's kind of figured out. Alright, cool, I'll kind of go there." But then I see this other interesting thing over here that's, you know, half-figured-out, and I'm not as good at the lock-in.
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Sam Parr | as far bored after you figured out the puzzle exactly yeah | |
Shaan Puri | but for | |
Sam Parr | I have to figure out a little bit more. It's like I want a higher certainty that the puzzle pieces are even going to be able to fit together. You know what I'm saying?
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Shaan Puri | Right, right, exactly. But then once the puzzle's done, you're like, "My puzzle! I love this puzzle."
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Sam Parr | Dude, this is my puzzle. I'll tell you an example. So, Sean and I are going to Vancouver on Wednesday, I think. We're doing this little meetup with us and Andrew Wilkinson.
This wasn't even that well organized. They've done a good job of it, but "well organized" isn't the right word because that sounds insulting. It was just kind of low-key. We just have a type form that you have to sign up for, and that's it.
Then you pay $50 to show up, and I think you get a refund if you show up. I think they're doing it to guarantee seats for the people listening to the pod. If they say, "How do I sign up?" I don't even know where to go.
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Shaan Puri | We're doing a meetup, but it's in stealth mode for no reason. I don't know what the organizer is doing, but it just doesn't make any sense to me.
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Sam Parr | it doesn't make any sense to me | |
Shaan Puri | Yo, what's the venue, date, and time? Man, it's all coming together. We're working on it. It's like, yeah.
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Sam Parr | I don't know I don't know | |
Shaan Puri | fyre festival what's happening here | |
Sam Parr | And then they refunded the money, and I'm like, "Well, I could've used that money on my flights and hotel." I wish... you know, like I'm paying money to go and do this. It would've been cool because that thing made like $50 or $100. I'm like, "You know, give me like $3,000 to pay for my stuff."
But when I kind of realized that we were able to pull off some of this stuff, I'm like, "Oh hey, we can get people..." The thing with media is if you can get people to buy stuff or leave your home. So, like, if you say, "I'm going to be at this location at this time," if you were able to get people to do that, that means you have pull.
And once in a while, when we pull that off, then I'm like, "Oh, we could have pulled this off, something like this," or "We still could... we still can." Then I start to believe it.
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Shaan Puri |
Yeah, that's interesting. Actually, that's a good metric because I've been trying to think about the content side. I'm like, you know, I want to set a goal because I think I work better when I have a goal or...
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Sam Parr | to work | |
Shaan Puri | it off of | |
Sam Parr | You have to give context. The context is Sean is now considering, planning, or actively working on creating content more intensively.
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Shaan Puri | Yeah, exactly. Sounds lame. I don't even say those words. "Content creator" sounds lame. I'm going to come up with my own words.
But, like, the idea is, hey, I like doing this thing where I get to just learn about stuff, talk about it, and people seem to like it. A podcast is one version of that; a newsletter is another version, etcetera.
Anyways, I was like, "What's a good goal for this?" I thought, "Oh, a million... 10 million subscribers? Fans? No, what do I want here?" Intuitively, there's something more like that Kevin Kelly thing about "1,000 true fans."
He wrote this amazing blog post called "1,000 True Fans." Basically, it says if you can have 1,000 true fans— a true fan being someone who would pay $100 across the course of a year— they'll buy your shirt, they'll show up for your event, they'll buy your tickets, they'll do whatever because they really like your stuff.
For an artist, if you're someone who's just creating, 1,000 people who are willing to pay $100 sounds kind of achievable. That’s not like saying I'm going to be the next Justin Bieber or whatever. And it's $100! You could make a living doing what you love if you get to that.
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Shaan Puri | That was like one of the original things that I think inspired a lot of content creators online. I was like, "Oh, maybe something like true fans." But how do you measure a true fan? I guess it's this $100 spend thing.
But I think this thing you're saying is actually true, which is it's like a test. It's like if I just tweeted, "Hey, I'm hanging out at this coffee shop right now in San Francisco," how many people would show up?
I think three years ago, that answer was 0 to 2, you know? Maybe just my actual friends who I hadn't caught up with in a while. Now, I don't know what that number would be, but probably... what do you think? I have no idea.
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Sam Parr | well if you no | |
Shaan Puri | no a 1000 would be crazy but if I was like laying out here all day so it's not like | |
Sam Parr | if you gave it | |
Shaan Puri | a window | |
Sam Parr | If you gave it a 2-week window or a 2 to 4-week notice, I think you would get...
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Shaan Puri | I'm saying same day I'm just I'm gonna be here all day swing by if you're around | |
Sam Parr | 50 to a100 I bet | |
Shaan Puri | 50 to 100... yeah, exactly. I think that’s probably great. That’s amazing.
There are some situations where it's like the coffee shop is like, "What the heck is happening here? There are too many people!"
So, there’s some way of testing that. I think what most people go for is reach, and they get really tricked by these platforms that say, "Yeah, your video got 95,000 views." And it’s like, cool, but how many of them actually watched this versus just swiped by it? Or, how many of those 95,000 people know your name? How many of them know anything about you? How many of them care about you?
I think what most people do is they just take what they’re fed, and they’re fed basically the most large vanity, useless number. For any business, you want to find not the vanity metric, but the true metric that actually shows the level of engagement you have and the level of love that your product has.
Different businesses and companies have different ways of looking at this. For example, Facebook, back in the day, one of their metrics that mattered was, "Yeah, of all of our sign-ups, 50% of them use this every day." That became significant because it wasn’t that they had the most sign-ups—MySpace had way more—but Facebook had half of the total sign-ups using it every single day. That’s gotta mean something.
The people who were able to identify that inside the company and as investors got mega, mega rich, whereas other people were just chasing a total user count number but didn’t really have a good way to measure it.
So, I think there’s something to finding the real metric that matters. At The Hustle, what did you guys use? Because you could have just said subscribers, right? But that wasn’t quite the thing. Do you have any examples of finding the real metric that matters?
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Sam Parr | Dude, we would just do replies. Every once in a while, I would purposely write about something that was a bit controversial or I would purposely have typos. I would just see how many people would reply and say that they saw a typo.
At the very bottom of the email, I told you to do this, and I think you did do it. I would say, "Where, where, where? What city are you in right now?" or I would say, "I'm working from this brand new desk. It's called this. I love it! Take a picture of your workspace. Let me see it."
Yep, and it would be just about how many people are going to take a picture and reply back to the email. There was a time when we said at the very bottom of the email, "We're going to send out stickers to everyone that replies," and we got like 10,000 replies. So, we had to mail out 10,000 stickers.
We would do little things like that. We got like 10,000 replies on about 100,000 subscribers. I remember that anytime we get a reply from an email, that's a really good sign.
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Shaan Puri | Right, and like I see this all the time with newsletters now because Substack has this feature. If you subscribe to one newsletter, like I read something and I'm like, "Yeah, I like this," I subscribe. It pops up this full-screen thing which is just like, "Sean recommends these 5 newsletters." Really, there's only one button, and you're just like, "Okay, next," and you hit that. Now you're subscribed to 5 newsletters.
You can see people on Substack, they're like, "Wow, my growth is crazy! I'm hitting 100,000, 200,000, 300,000 subscribers." No...
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Sam Parr | it's bullshit | |
Shaan Puri | Dude, it's all bullshit. And Substack's like, "This is awesome!" when they're showing this. I'm sure in their investor presentation, they say, "Look at this! Now we drive the majority of subscriber growth for our newsletters."
There's a network effect here. It's like, no, it's not a network effect. It's a giant screen where people click "next." I used to do this with our mobile apps. It's like, "Oh, if I want this app to grow, let me just pop up a screen where it's your entire contact list, everybody pre-checked, and there's one big button that says 'next'."
There's a tiny black "X" that's hidden in the top left corner. If you could see that, you're going to skip it. Everybody wants to skip it, but 2 out of every 10 people are just going fast and they're just going to hit the button. They just spammed all of their contacts, and guess what? My app goes viral.
Is it really viral? Are they sharing it because they like this product? No, they're sharing it because I tricked them into spamming, basically. And Substack does the same thing. They basically trick people into subscribing to these newsletters. This is my opinion. I'm sure they would disagree and say, "No, no, no! People just really want to be referred 5 newsletters every time they've subscribed to one." I don't believe that for a second.
This happens with podcasts too. There's a very popular business podcast. I like the guy, but I think his numbers are BS. You know, should I say the name? I don't know if I should say the name, but...
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Sam Parr | do it | |
Shaan Puri | Let's just say it's about a 30-minute VC. It's a little less than that, so leave it to your imagination. No, he's a great guy, and he's done a great job building his podcast up. But he'll tweet out these things where he'll be like...
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Sam Parr | 2,000,000 people listen | |
Shaan Puri | To the last week's episode with this person, and I'm just like, "Dude, there's just no way in hell."
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Sam Parr | that's joe rogan numbers | |
Shaan Puri | That's... there's not 2,000,000 people. I know we have a podcast. I can see where we are in the ranks. I can see where he is in the ranks. I know other people that are on top of the charts. You can look at the reviews; you can just see the cult following of certain things.
If you said, "The All In Podcast is getting 1,000,000 views per episode," I'd be like, "I think that's true." They have really tapped into something. Yeah, you could see the YouTube numbers. You could think about where the podcast charges. I think it's doing at least 1,000,000, probably closer to 2, per episode. They do it once a week. It's super high quality and has broad appeal. The numbers, the data, match up to that signal.
But when you're like, "Oh dude, yeah, I get 2,000,000 per episode for my super, you know, my talk with the third least well-known partner at this fund," I'm just like, "There's no chance." I think I even asked him once, "Dude, how are you getting these numbers? That sounds like off the charts for what a business or tech podcast of this size could do."
And he's like, "Oh yeah, we have a big audience in Asia or wherever." And I'm just like, "Oh, okay." Well, I've been in the internet game long enough to know... like, dude, I bought my first 5,000 Twitter followers, right? I know that you can get any number by doing anything on the internet, and it doesn't mean anything, especially for something like podcasts, which is like newsletter subscribers.
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Sam Parr | the hardest thing ever | |
Shaan Puri | To have to do once, and now you're a consumer of everything else. Like, nobody could even measure on podcasting if anybody's actually listening to these things.
So, yeah, I can go get a bunch of people to click subscribe one time, and it will auto-download my feed every time I release a new episode. There was a guy, Nathan Latka, that was doing this too. He was like, "We get this many downloads per month." I was like, "Oh wow, a couple million downloads a month? That's pretty good. Huge!"
Yeah, what do you do? And basically, when I talked to him, he was like, "Hey, welcome to the show, Sean, blah blah blah blah." He was going at hyper speed. Five minutes later, the podcast was over, and I was like, "This is a 5-minute episode?" He said, "Yeah, sorry, I gotta hop to the next one."
I asked him, "How many of these do you record in a day?" He said, "I record 8 of these a day." Then we release... whatever. He was on some crazy schedule.
I did the math and realized he has like 7,000 subscribers, but he just releases a huge volume of random 5-minute episodes. His total monthly number, because podcasting is just like... you know, if you just do downloads, it just adds up all your episodes times your number of subscribers.
You can have a small number of subscribers and do a huge number of episodes and get a big download number. So, people, I think, use these vanity metrics all the time, and they're BS.
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Sam Parr |
So, I'll bring this up because we're discussing it, but I didn't research it fully... Have you heard of Parcast? It's like my name but "cast". So, Parcast - have you ever heard of that?
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Shaan Puri | Are you spinning off your own solo project? Did the band break up? Are you doing your own thing now? No, you're with Lucas now.
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Sam Parr | I wish I invented this! So, there's a guy named Max Cutler. I think he's around 31, 32, or 33 years old. This guy created something called Parcast, and the whole idea of it is that it's a podcast network focused solely on true crime.
And I'm a weirdo... you want to know what I listen to every night? There are two podcasts I listen to every single night. The first one is just called "Serial Killers." It's a series of podcasts about serial killers. I can tell you all about it! I have my fantasy league of serial killers, you know, with Ted Bundy as the quarterback.
Then there's another one that's fitting for going to sleep. It's called "Deathbed Confessions." It's about people who confess to a crime they committed when they're dying. So, it's just... oh!
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Shaan Puri | it's just nice | |
Sam Parr | It's the best! So, this guy started this, and it's all scripted. It has voice actors, and it's all scripted stuff. He bootstrapped this podcast company, which is unheard of, and he sold it to Spotify for $200,000,000 after only maybe 5 years.
He and his dad owned the whole company. His dad was in radio, and he was like a radio announcer or something like that. They are producing something like 30 or 40 podcast episodes a day, and they're all highly produced. It's amazing! Have you not heard of this business?
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Shaan Puri |
I've heard of this brand once before. I didn't realize... I didn't know the business side of it. I didn't know that they had bootstrapped it and sold it to Spotify.
I really like true crime, but I don't know where to start. There are so many true crime [podcasts/shows], and a bad one is such a waste of time. But yeah, I've seen some of their shows because I sometimes look in the browse section for a good true crime [podcast/show].
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Sam Parr | dude so true crime if you go and look at so what's a good one | |
Shaan Puri | in theirs | |
Sam Parr | If you look at it, I like serial killers. Serial killers, dude! Deathbed confessions are awesome. I'll send you a good deathbed confession; they're so awesome.
True crime... if you go to the podcast app and look at the top episodes or shows, it's always like 30 or 40% true crime. It's mostly women who listen to it.
And so, like Dateline, I told you about this Dateline from NBC, which is a show that's been around for 20 or 30 years. It's still usually a top podcast every single week.
These true crime folks really kill it. This guy bootstrapped his company to, I think, it was $100 million cash and then another $100 million earn-out, all off of these true crime podcasts. He killed it! It's a really interesting story. I'm going to have to dive deep and do some better research on it, but I was reading about it this weekend. It's a pretty amazing outcome this guy had. | |
Shaan Puri | So, I just read an article. This might be maybe wrong, or maybe you're wrong. I don't know. Spotify confirms it paid $56,000,000 for a podcast. Or podcasts, sorry.
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Sam Parr |
Then maybe I got my numbers wrong. I think it was $56 [million] and then another like $75 [million] outcome. It was a 9-figure... no, another retention. There was a retention according to the Parcast Wikipedia, which reads as if Matt Max Cutler, the founder, wrote it. It's very congratulatory. It says there's like a huge earnout.
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Shaan Puri | Yeah, I don't know if I trust anyone that does true crime. By the way, these guys are natural storytellers and like liars.
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Sam Parr |
Dude, alright, I've got an interesting thing to bring up. This is something that we talked about a while ago. I think you brought this up in 2020 or '21, I forget... right when we were recording in the original Hustle office. So, do you remember that company Crumbl that you brought up?
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Shaan Puri | yeah well first of all I love a good I told you so so I'm already I'm already glowing yeah I remember | |
Sam Parr | dude you got this | |
Shaan Puri | crumble crumble cookies | |
Sam Parr | Crumble Cookies. So, when you originally told me about it, the story was something like two brothers or two cousins launched this thing. For some reason, in my head, I'm thinking of a family cooking and making cookies in their kitchen. They start this pandemic thing, and it gets popular.
Basically, once a week, they tweet out a new menu and have a drop, you know, things that typically Supreme does. But they're doing it with outrageous flavored cookies. Well, that's not entirely true. What is true is they do these drops, but it's a massive business. Some sources are saying it's close to **$800 million** a year in revenue.
The reason I saw it was someone shared this on Twitter. Over the last couple of months, it's been growing and growing. The other day, it was the **fourth** most downloaded app of the week. They have an app, and it now has **2,300,000** ratings or reviews with a **4.9** average.
Right now, they're opening brick-and-mortar stores, and they have a new store opening every **five** days. They have something like **730** stores at the moment, and it's one of the fastest-growing chains in America.
Check this out: they have **800,000** followers on Twitter, **3.4 million** on Instagram, **6.5 million** on TikTok, and **1.2 million** on YouTube. They create these commercials every single week for a new cookie drop, and it is crushing it. These guys are killing it!
It's so fascinating. I never in a million years thought this was going to work as big as it has. Basically, every Sunday at **6 PM**, they do a new drop, and their app just spikes and goes way up the charts. They are up there with Uber Eats and all that stuff. They're killing it!
I remember you brought this up, and in my head, I was like, "Oh, this is like a little mom-and-pop sausage..." | |
Shaan Puri | cute like oh that's cute fake fake | |
Sam Parr | Like, "Oh, your aunt made cookies." That's nice. Yeah, no, they're sharks. They're killing it.
So you called that pretty early on, and now it's a franchise.
Here are some stats: In 2021, the highest revenue store did something like $3,600,000. Other stores had an average of about $1,600,000. The store with the highest net profit was $600,000, with the lowest being $33,000, and the average profit being around $350,000.
According to the founder's Twitter, they did over $1,000,000,000 in revenue. You have to come up with $150,000, and then you can open up a franchise. They send you all of this traffic via their Instagram and their app. Super fascinating business.
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Shaan Puri | Yeah, I think in the franchise world, this is like the hottest franchise right now: Crumble Cookie. They're just exploding and super popular at the moment.
However, I do feel like this is not the most sustainable franchise. At one time, I think froyo franchises were growing like crazy, like Pinkberry or whoever else. You know, there are these waves where certain treats become the trend.
But I don't know how many people are going to like anything that's drop-based. There's a natural fatigue that sets in for the buyer. There's also a vicious cycle: drops become even more fun when everybody's into them because it's like the hunt. You either got it or you didn't, and you feel special.
But as soon as the drop fatigue starts to kick in, and now, oh, the notification's there, but if I don't get it today, I can go get it tomorrow. As soon as the scarcity is gone, the drop plummets in value. So I think that’s a challenge for something like this.
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Sam Parr | I agree, but look, here's the deal. I have a friend who buys broadband companies. Broadband companies are basically internet service providers. A lot of people who are listening in the city will have no idea what I'm talking about, but where I have my country house, I have this ranch way out in the country.
If you live out in the country, it's not like you're getting Spectrum, Google, or Warner, or whatever the big service providers are in New York City. You're getting a small internet provider that you pay $100 a month for. That company probably does $10,000,000 in revenue and like $5,000,000 in profit.
You and I have a friend who goes out and buys these companies. Everyone says to him, "Well, what about Starlink, yada yada yada?" And he was like, "Yeah, they'll come eventually, but until then, I'm making $5,000,000 a year in profit."
So, with this cookie thing, yeah, maybe they'll plateau, but $1,000,000,000 a year is a nice plateau. I don't mind sitting on that plateau for a while. And that's kind of how I feel whenever I hear some of these stories. It's not going to grow? I'm like, "Yeah, that's cool."
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Shaan Puri |
Sorry, I couldn't hear you. The money counter was burning a little too loud in my ears. Right, that is actually... if anybody asks me why I sold for $200,000,000, you're getting a slap. Like, you know, just don't ask. Don't ask those stupid questions.
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Sam Parr |
Dude, and the founder - one of the cousins or one of the brothers - he previously worked in tech and he had a Facebook app that got to like 120,000,000 followers. So these guys are like viral guys, they know how to do this. But interesting story.
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Shaan Puri | Yeah, it looks like he was the Director of Product at Ancestry, which is one of the gems of internet companies. It's really big, but nobody knows anyone who works there. Nobody claims to use it, even though it's a really popular site. They did a bunch of cool, viral things and basically implemented smart product strategies along the way to make that business work. | |
Sam Parr | dude ancestry is funny too because they're a a utah based company and they're founded by mormons | |
Shaan Puri | By the way, this guy's first business was BYU.com. Have you heard about this?
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Sam Parr | no here's what it says | |
Shaan Puri | On his LinkedIn, BYU.com was a social network for Brigham Young University students. We grew the network to include half the campus in a very short amount of time, but it was ultimately crushed by Facebook.
He did this in 2005; I think Facebook launched in 2004. So basically, he was doing the Harvard social network just on BYU's campus. But like the Facebook wave, you know, swallowed it.
But that's pretty impressive. Yeah, you're landing on the putting green right there. If you're creating a social network back in 2005 for college campuses, like, goddamn, you were close to being onto something. You know, I'm not surprised that this guy ended up being really successful.
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Sam Parr | No, it's a really fascinating story. But anyway, where do you want to go? Do you want to drive? Can I tell you the story really quick? Ben has a story.
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Ben Wilson | So, obviously, you mentioned they're a Utah company. Of course, I know.
The story is this: a guy from Utah State University asked me for a connection. He looks like he's just graduating or about to graduate. I have a bunch of mutual friends with him on LinkedIn, so I thought, "Okay, I'll do this kid a favor." I didn't know what he wanted, so I clicked "Add."
He immediately starts posting cringe. He's like, "I'm starting this company; it's gonna be huge!" Then he keeps posting stuff that's hard to describe. It's very *Adam Grant* or dumber business advice. For example, "Did you know that you can increase your productivity by 20% by having a team off-site?" So, we're having a hashtag team off-site this weekend.
I was just like, "Who is this kid?" He says he's starting a cookie company. Honestly, when they opened their first location, I was amazed. I didn't think this kid would ever actually get even one location open. And it was Sawyer, the founder and COO of Crumble, and this kid who just posted cringe to my LinkedIn timeline.
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Shaan Puri | Oh no, that totally breaks my frame. I just always assumed that if you're that mega cringe, you won't win. Now, I have to consider the possibility that every hashtag user could actually be a winner because I just had a blanket rule.
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Sam Parr | If you're a Mormon guy and you're telling me you're going to start a cute cookie franchise, I'm in. I mean, come on, of course this guy's going to crush it.
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Shaan Puri | Mormon does Trump cringe? So, like, if you're Mormon, I have to... you know, the checkbook's already out. I'm just waiting to hear how many zeros I need to put my number here. But that's based on the idea. So, yeah, you're right. That actually overwhelms the cringe part because it's like, "This guy's gonna sell."
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Sam Parr | he's gonna sell | |
Shaan Puri | knows how to sell | |
Sam Parr | yeah the well that sucks ben yeah you missed out on that one | |
Ben Wilson | yeah I know I should have just hit him up and like oh this looks really cool but you know we can learn | |
Shaan Puri | I can't find this client info | |
Hubspot |
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Sam Parr | sean I have a couple things what do you wanna do | |
Shaan Puri | Okay, I have a quick little idea. So, I was watching the Super Bowl. Did you watch, by the way?
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Sam Parr | I watched the halftime show | |
Shaan Puri | yeah I watched it | |
Sam Parr | I watched no I I I watched like quarter 3 who how long did it take you | |
Shaan Puri | To figure out if Rihanna was pregnant during the halftime show, are you quick on the uptake or not?
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Sam Parr | You know, it was one of those things where my wife loves her. And like, you know, you don't want to be rude when you see a lady with a lump, and you want to like, you know...
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Shaan Puri | and how I'm not going first that's I'm not I'm not talking | |
Sam Parr | Yeah, yeah, yeah. So, I had her go first, then I asked. But she was doing some pretty raunchy stuff as a pregnant lady, right? I mean, that was like, oh, I... | |
Shaan Puri | thought that was tame for rihanna that's like that was pg to rihanna | |
Sam Parr |
Dude, I'm a Rihanna fan. She's in my like top five most beautiful women on earth. I'm... I'm on team Rihanna. But when I saw that she was pregnant, it... it was surprising. I think she just had a kid too.
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Shaan Puri | Yeah, that's... she just had a kid like 9 months ago. I don't know. The math doesn't even make sense to me in my head.
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Sam Parr | I don't I don't know whatever | |
Shaan Puri |
Whatever, I'm watching the football game and one thing you notice if you're watching the game is that when the Chiefs were scoring, they were scoring with these like incredible plays. The guy was just going untouched into the end zone... like through the woods.
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Sam Parr | They have this thing where they will get in a huddle, like "Ring Around the Rosie," and then they run to the line. That was crazy! Is that like...? | |
Shaan Puri | didn't work | |
Sam Parr | what is that | |
Shaan Puri | But it's amazing that they tried it, right? That was an awesome play.
I was thinking about it, and I was like, it did stand out. They had two or three touchdowns where it was just brilliant play design, right call, and it totally worked.
You know, I love sports and I've watched tons of sports documentaries and shows like *Last Chance U*. You can just see the life of a coach. A coach is a really specific character in my head. A football coach at a high school, college, or even pro level is usually the same type of dude in most cases. Their life is football; they live and breathe this stuff. They're preparing all week for the Sunday game, and then they start again the next week. They just live in this playbook and the X's and O's.
They all have the same value system about toughness and grit and whatever. I was like, "Oh, this is another job that AI is going to replace." Because I thought, this is an AI problem. The problem of an offensive coordinator in the NFL is basically, "What play should I call here to maximize my expected return?"
I think somebody's going to build AI that ingests a bunch of data that says, "In this situation, third down and seven," and maybe even takes into account the teams and the talent equation. This is the best play to run with the highest expected value. It's basically like what *Madden* does when it suggests, "Yeah, run this play." But like, yeah, yeah, yeah.
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Sam Parr | that's exactly right | |
Shaan Puri | Good version of Madden. Now that we have, you know, computers that are geniuses, I'm pretty sure that someone's going to build a play caller AI.
These guys are literally looking at a cheat sheet, like it's an open book exam. They can bring in an 18 by 11 piece of paper, and everyone's writing in size 2 font to squeeze as many things as they can on it. That's what these guys use when they're calling plays. They have, you know, 10 seconds to pick the play.
This is just a job that computers are going to be better at. It reminds me of how crazy AI is going to be. Even in these total non-tech situations, not even big markets, it's just going to be like when humans play against a computer at chess, or even Go, or poker, where the computer is just so much better than the human.
That's what's going to happen in this play calling situation. It just kind of reminded me that, man, AI is going to be nuts because it's going to take over all these things that you wouldn't really have expected or thought were in the line of fire for AI.
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Sam Parr |
Is football... You know, there's obviously the famous *Moneyball* thing where he's like, "I don't care who's a superstar or who's not. I'm just gonna look at the math and we're just gonna pick people off spreadsheets." And then famously, although I think this is highly exaggerated, Chamath was like, "Oh, I'm gonna buy the Warriors and we're gonna do that same thing with basketball. So we're only gonna shoot threes," or whatever their stick is.
[Pause]
Sorry, I'm ruining this.
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Ben Wilson | but yeah | |
Sam Parr | and and I but the reason I have a feeling it's not true is I have a feeling | |
Shaan Puri | no | |
Sam Parr | no that is true team and also like I think he said that though right | |
Shaan Puri | I don't think so but fair enough | |
Sam Parr | well I'm making it up then but other people did | |
Shaan Puri | it in basketball daryl morey famously was like the big you know proponent of this | |
Sam Parr | The reason why I don't believe that is I have a feeling like teams were always doing this.
Maybe it's one of those things where, for example, my favorite copywriter said, "I wrote these famous ads for the... what's it called? The Casio watch." He explained how they used space-grade aluminum and crystal quartz to make this watch.
He said, "Little do they know, every watch does that. That's just like table stakes; every single watch." But I'm going to explain it because I know that the audience doesn't know.
So, you have a guy saying, "Look, we use state-of-the-art technology," and it's like an Excel sheet that everyone else uses. It's like, "Yeah, I guess it's state-of-the-art." But anyway...
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Shaan Puri | We have a premium license to Microsoft Excel.
Yeah, yeah, unlimited seats. Unlimited seats. We do not use the trial.
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Sam Parr | but is football the same way where you could just follow the math | |
Shaan Puri | So, there's actually a great question. Daryl Morey went on that guy... I forgot his name, the invest... invest like the best guy, Patrick.
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Sam Parr | patrick shaughnessy yeah that's cool | |
Shaan Puri | He won on his pod. Actually, it was a really, really great podcast. If you like sports and you like kind of business stuff, it was kind of an amazing one.
He talks about how baseball is basically the almost perfect game for modeling. You could basically model it because it's stationary. It's like one pitcher versus one batter. It's a contained problem.
Whereas in basketball, you've got 5 guys on each team on the court. You've got 10 guys all moving around freeform at any given time. The ball is moving like crazy, so it's much harder to model.
But you could still model the impacts of one player in certain situations. The data thing has had a pretty big impact in basketball, but less than it did in baseball. Baseball sure became a math equation. Basketball became more of a math equation than it was before, but still, it's never going to be perfect. It's too complex and has too many variables. | |
Sam Parr | to be yeah | |
Shaan Puri | To be perfectly modeled out or whatever, it was still improved. This is why you see, like, they will post, "20 years ago, here's what the shot chart looked like," and it's just dots all over the court, as you kind of expect. People shoot from everywhere.
Now, in 2023, it's like people only shoot layups or threes. This is because, optimally, a three-pointer is worth, you know, 150% more than a two-pointer. However, the percentage difference in shooting it is only about 5 to 7% worse than a two-pointer. So, you get a much higher expected value for shooting a three. That's why all these teams shoot threes now or layups. They tell their players not to shoot that in-between shot because it's the wrong combo.
Then, he said football is going to be the hardest one to game because you have 11 players on each side. On any given play, everybody's moving in different directions, and you can't really figure out the net effects of one guy running in a lane and what that causes another guy to do. It's much harder to analyze.
But I think that's true at a high level because the reason these general managers care is that they're trying to find undervalued assets, like stock pickers. They say, "This player is not just what his traditional stats look like; his game impact is different because of whatever." So, you're trying to figure out the value of one player. | |
Sam Parr | but is the game impact because of locker room stuff and leadership or is it no | |
Shaan Puri | No, they're looking at just the on-the-court movement. Like, you know, in basketball, for example, there's an assist. If I pass you the ball and you score, that's an assist. But if I pass you the ball and I've made the whole defense shift to me, and then you pass to the next guy, you get the assist. The stat sheet doesn't show that I actually was the one who created this whole play, this opportunity, by caving in the defense.
So, the traditional stat sheets are limited. What these guys have done is figure out advanced stats that better show an individual player's impact, not including locker room stuff.
He's saying football is even harder. There are more players, more movement, and less plays total, so you have a smaller sample size. But I think that this play-calling thing is bigger in football because, in basketball, you don't call many plays. In football, every play is called in by the coach.
If you can make the coach 20% more intelligent by suggesting a better play, that's going to shift the balance of power towards that team because they're just going to get that many more first downs and touchdowns.
So, I think this is, I don't know, it's kind of really niche here, but I think this is an example of how AI is going to touch a bunch of areas and kill a bunch of jobs you don't expect. Varshaa, you got something?
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Sam Parr |
Yeah, okay. So last night, the game was dictated by that terrible call. You know, the Eagles defender got called on like a pass interference that basically ruined the game. Chiefs win. That should have been decided by an AI ref. Like, why are there not AI refs? Why is any call up for debate, you know?
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Shaan Puri | I agree. Well, there are some sports, like in tennis, where they put a chip in the ball. So, when the ball lands out, you see they always instantly cut to this silhouette of the ball, showing whether it was out or in. Everybody's just like, "It's unarguable." And why is that? Because they have a chip in the ball and a bunch of cameras that triangulate it, so they can tell you exactly whatever.
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Sam Parr | dude but that that means it's like so boring | |
Shaan Puri | Well, that's the problem. Because in baseball, you would have been like, "Oh great!" The umpire calls strikes by squatting behind the catcher and trying to eyeball this. That's insane for this $1,000,000,000 sport.
Like, why are they doing this? It turns out if you just used a computer to perfectly call pitches... I guess the reasoning must be, and Ben Ben Levy might know better, but there must be something where people preferred that their human had the final say here. Because the technology is there for a computer to call balls and strikes. There's really no need for that umpire anymore.
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Sam Parr |
I'm not romantic about the early part of the game. I'm romantic about fist fights - that's what I want. And that's the best part about baseball, when they get mad at each other. I mean, that's what I watch. I don't watch any of that other crap. I wanna see them fight.
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Shaan Puri | There's a demo I sent to Ben. I'll show it to you. There's a demo of... because there's actually a bigger problem in fighting. Like, dude, how many fights... I don't know, in the UFC fight this weekend, did you think the right guy won? I thought the right guy won, but people were... | |
Sam Parr | me too but a lot of people did not | |
Shaan Puri | People did not... and there's this big problem with like, it's these three judges that are going to decide who won the fight.
And it's like, how do you call it? Oh yeah, how do you judge? You know, what if this guy made the wrong facial expressions? Did he get hurt? How am I assessing damage here?
Whereas there's an AI demo of basically the striking tracker, where it's like this guy did a left hook and it landed with this level of impact, or it was deflected partially, or it was a clean shot.
And they're like, we should have basically perfect tracking of the fight game. But for you as a fan, would you want that? Would you want the computer to basically say who won the fight, or do you want these three old judges to scribble a scorecard?
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Sam Parr | I want the 3 old judges because | |
Shaan Puri | that's nuts | |
Sam Parr | a lot | |
Shaan Puri | of fight can't believe it | |
Sam Parr | A lot, but here's why. First of all, when you watch WWF, or like fake wrestling—it's called WWE now—the best part is when they hit the referee or distract him. Sometimes they'll have a hot girl come and distract him, and he turns around, and then something bad happens. That's like the best part of the show; it's when there's drama.
But also, in UFC, they have a new thing where they measure aggression, you know? Like, who's pushing the plot. I think they do that so it's more exciting. I don't know if you can entirely measure aggression with AI, but that's why I don't like it. I'm okay with having humans do it. I think it makes it more exciting.
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Shaan Puri | They're almost always only in the conversation when they do it wrong, right? It's never more exciting because, man, they really added to the fight there by scoring it. You know, they don't add anything; they only subtract when they screw it up. I'm surprised you don't want the actual accurate score. | |
Sam Parr |
The only thing that I want is for them to tell me the scores of a fight in between rounds and have that be the official thing. Because I want the person to know when they're going into round 3 or round 5 that they're down, and if they don't knock this guy out, the fight's over. So that would be the only change that I would want. I want them to know the real score as it's going.
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Shaan Puri | I got one more random topic let's do one more even though we're a little over time | |
Sam Parr | Well, if you're going to do one more, are you going to do this guy, Ahmad? That seems meaty. Alright, go for it.
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Shaan Puri | Yeah, it is kind of meaty, but let's do a fast version of it.
So, this guy, Amjad, who is the founder of Replit, which is an awesome company, tweeted this out. He goes, "You know, some of the biggest companies that were built, like Airbnb and Uber, were built because they took an underutilized asset and were able to get more utilization."
For example, Uber or Airbnb said, "Well, there's an extra bedroom in your house or extra rooms. You have extra space today that's not doing anything, but you could rent that out. We could actually have more rooms to stay in and more options for a customer." That became Airbnb, this multibillion-dollar company. Uber was the same way.
He goes, "What are some other underutilized assets?" I think this is a great framework for trying to figure out where a marketplace could be. I think people were doing this maybe 5 years ago, 7 years ago a lot more. There were people who realized this and started jumping on it. That's why you got Wag, the dog walker app, which became worth $1,000,000,000, and Airbnb, and a bunch of others.
I have some examples here, but what do you think about this framework? What examples stand out to you?
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Sam Parr | I think it's brilliant. I see on here you have stay-at-home moms. One of the best companies, or one of my favorite companies that I've been eyeing, is called Squared Away. Their whole niche is virtual assistants, and the virtual assistant is a military wife.
For some reason, in my head, I think they're going to act a certain way, which who knows if it's true. But I think that's one of the best ways of like a quote, an underutilized asset. I love that.
But the problem is, a lot of people... I knew a guy who started a thing where you could do... it was like self-storage but in other people's garages.
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Shaan Puri | right | |
Sam Parr | And I'm like, "Dude, this is the stupidest shit I've ever heard of." And it was, in fact, really stupid, and it completely didn't work. I think that a lot of people approach us poorly.
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Shaan Puri | Yeah, I think there are a lot of things you could consider. For example, I know another idea that people have tried a bunch is involving chefs.
It's like, "Oh, why do you only order from restaurants?" What if there's a lady who lives three doors down that makes an amazing Thai red curry? You could just order from her, and she would get revenue for her cooking skill. Then she could deliver it to you, and it's closer. It wouldn't just be limited to restaurants.
However, operationally, these businesses are usually absolutely brutal. There are a whole bunch of safety and quality concerns, as well as uniformity of quality issues that come up.
I think that's another problem. Then there are the economics: is there enough dollar value for the customer to pay the provider, for the provider to get paid, for the middleman to get paid, and for the delivery person to get paid? You need enough value in the chain, which is why Airbnb works—it's a high-ticket thing. | |
Sam Parr | there's one for versus others and there's one for pools that I hear is killing it | |
Shaan Puri | Yeah, exactly! Share, like, rent a swimming pool by the hour, right? Because I have a pool that we're not using 95% of the time. So if somebody could rent it from us, it would make a few hundred dollars.
Yeah, that's great! I want to give you some of the best answers that came from the thread. So the first, the number one is cars. I think cars are parked like 93 or 95% of the time.
Once we have self-driving cars, that car shouldn't just stay parked; it should go be a taxi for somebody and earn you money. I think that's one of the big unlocks. People who know about this are like, "Oh yeah, that's obvious," and that's going to be a big deal.
But I would say the majority of the population doesn't realize that your car is going to turn into a worker for you. You're going to be earning revenue when your car is idle instead of it just sitting in your driveway or your garage.
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Sam Parr |
Dude, **Getaround**, which I used to use all the time in San Francisco, I think they raised almost $1 billion in funding and they went public recently-ish. Their market cap as of right now is $59 million. So... wow. No one quite has figured it out yet, it looks like. Well, that's at least what they have.
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Shaan Puri | that's a little different that's still rental cars this is gonna be just like | |
Sam Parr | no get it on to other people well yeah you're right you're right right yeah | |
Shaan Puri | like this | |
Sam Parr | is this alright | |
Shaan Puri | So, it is what Tesla is basically betting on. This is what Elon is betting on. He basically is like, "Your car is gonna go from a depreciating asset to a revenue-generating asset for you," which will make the car worth five times more than it is today. Once it's able to just run all day for you and go do rides. | |
Sam Parr | okay that's that's bold but that'd be cool if it works out | |
Shaan Puri | Clean, structured data. So basically, there's a bunch of data from different companies just sitting around. If you could kind of organize it and clean it up, that data is actually an asset that can be used.
Like we talked about earlier, the FreightWaves company is doing pricing data. You know how many companies have pricing data about what they bought recently, how much it cost, what volume, and from what provider? If that was available in a structured way, you could sell that to a middleman, like a network or a data aggregator.
That becomes a valuable asset that today is worth $0 to the company that has the data but is not doing anything with it. It's not their main business to be able to do something with it. I thought that was kind of an interesting point. | |
Sam Parr | dude someone wrote the sun | |
Shaan Puri | Yeah, the sun. So, they were like, "The sun is basically providing all this energy, but until we have solar and batteries to capture it, it's massively underutilized."
We're getting free energy from this giant, you know, nuclear fusion reactor that's in the sky or whatever. But you have to be able to capture it and store it, and it's underutilized for that reason.
Another one I thought was kind of interesting... So, a fun one: nightclubs. Nightclubs are really only useful for like 5% of the time, you know? At night, on Thursday, Friday, Saturday, or whatever. What can be done?
They're usually in kind of prime real estate in cities. I've always thought it was cool when I lived overseas in Indonesia. They used to take nightclubs and during the day, turn them into fitness day bars.
So, you'd go in, the dance floor and the mirrors would turn into basically like a cardio session, and then the bar would turn into a smoothie bar. I was like, "Oh, this is so smart! They're getting double utility out of their nightclub."
I don't know why I've never seen that in the United States for some reason. So, I think nightclubs is a fun one. And then another one that was on here was specialist talent... so like...
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Sam Parr | what's that mean | |
Shaan Puri | Like, think about somebody who's a really great 3D animator or something like that. If a company hires you, that's great. But I would actually say that when you're doing the thing you're world-class at, you're probably only spending about 10 to 15% of your time on it.
When you're in a big company, a lot of your time gets spent waiting for approvals, feedback, doing meetings, or whatever other stuff is around it. There's probably a case to be made that people with really specialized talent, like financial modeling or design, would be better off being freelance to companies. However, the market needs to be more liquid and fast-paced than it is today.
Like, Naval has talked about this. He says the future of work is basically like "Ocean's 11." It's small teams of people, and within each team, there are highly specialized individuals. You have the guy who's a pickpocket, the guy who can break codes, and the guy who can do acrobatics.
In "Ocean's 11," they gang up together to go on a mission for a heist. They then split the money, go on their way, and rest until they get the next call. He believes that's what work is going to be: pods of people that work well together, highly specialized.
They're going to get a beep out, wake up in the morning, and check their phone for possible missions they could go on. They could choose to do none of them and just chill that day, or take one because they're like, "Oh, that's a juicy bounty."
When they're done, the employer rates them like an Uber ride—5 stars. You rate the employer 5 stars, the money gets paid out to everybody's cell phone, and you go on your way, waiting for the next job.
I just thought that was a really sexy view of the future. It hasn't happened quite yet, but you can see that Uber kind of works like that, and there are services like TaskRabbit and others that kind of work like that. Freelancing is becoming more popular, so maybe we are moving in that direction. | |
Sam Parr |
I hate when people make these claims like "This is the future of [blank]." Like, if you say that the future is electric cars, yeah, I buy that. But if you say "The future of work is like Ocean's Eleven," my reply to that is: No. Maybe the future of *criminals* is Ocean's Eleven, but that's not... It's like saying "The future of people getting money is to rob banks." No. Maybe like a group of people will do that, but I just don't think that... But why?
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Shaan Puri | okay take the ocean's 11 analogy out right like yeah that's leading you to bankruptcy | |
Sam Parr | but what's wrong with | |
Shaan Puri | the actual | |
Sam Parr | Premise: I think most people now, it's like saying, "Well, most people are just gonna freelance." No, maybe 30% of America will, but I think that 60 to 70% of America, they want to go to work at 9, get off at 4 or 5, and play softball. That's what they want to do.
They don't want to go on a heist where they're having some exciting mission. They just want to clock in and clock out and do the same thing every day. Maybe we think that's cool; maybe we think our listeners think it's cool.
But when Naval says something like that, I think he is in this small bubble. Although he's smart and gets a lot of things right, I think it's too grandiose to say this is the future of work. I think it's really dumb when people say the future of media is the creators doing X, Y, Z. I'm like, "Oh my God, dude!" Maybe that's like a new band that you're assembling, but that's not how everyone's gonna operate.
I think you just like to smell your own farts. So, I don't like it. I think you're just out of your depth here. That's what I think when I hear stuff like that. | |
Shaan Puri | Yeah, but I think nobody means 100% of people are going to do this when they say "the future is X." I think they mean a lot of people.
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Sam Parr | that way | |
Shaan Puri |
Yeah, but no, 100% of people don't do anything today. 100% of people don't do 9-to-5s either, you know? Not even 80% of people do 9-to-5s. So I think that's kind of... I think it's a given, right? That's like... it's a given to people.
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Sam Parr | is it not sexy | |
Shaan Puri | Enough. You can't say anything is the future if you say everybody's gonna do it. There are still people who use AOL to get on the internet. Like, yeah.
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Sam Parr | my mom | |
Shaan Puri | You know, like, of course you can't say that everybody's gonna do it. It's not a realistic thing. But I think it is real to say that things are gonna change. Trends are gonna shift, and huge chunks of the economy or the workforce are gonna look different than they do today.
Because this whole idea of going to an office for a 9 to 5 is also kind of new. That was a shift from what was before. So I don't think that's just ingrained in humans. That's not biological; that's not physics. That's, you know, society and economics, and society and economics tend to change.
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Sam Parr |
It's not sexy enough to say, "The future of work is this group of people." That's a nice, small enough niche that you can go and capture market share while also being big enough to support a multibillion-dollar company that can return capital at a 55% annual return. I get it. That's not... that's not as catchy.
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Shaan Puri | yeah they were just shorthand for the future | |
Sam Parr | Yeah, but that's cool. I have some more topics that I'll save for later. This was a good one.
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Shaan Puri | alright that's the pod |