It’s The Most Taboo Business Model We’ve Ever Seen
Sam, you know what they say when you're on a boat and it's sinking? Get off. Women and children first. Uh, that's what we're doing with the podcast today. Women and children first. I feel like I could rule the world. I know I could be what I want to. I put my all in it like no days off. On the road, let's try. I have a topic I want to talk to you about. Have you seen this startup? That's called ko-fertility.
How do you spell it?
Ko-fertility.
I don't know, it could have been ko, like you spelled with a K, like in the Asian way. I don't know. Ko-fertility. All right, I get it. Yeah, I'm there.
So check this out. Uh, you know a little bit about egg freezing, but, uh, I didn't know much. I've never done it, but I do know there's like a growing trend of this. I think basically people are having babies later in life. And, um, egg freezing tech has come along and it's also become more normalized. I think some companies pay you or will pay for your egg freezing. Um, but like, just look at this Google Trends chart. So last 5 years, egg freezing has basically gone from, you know, roughly kind of 30, 40 on the Google Trends to like basically 80. And so it is, it is on the rise. And that's just in the past, I don't know, couple years, 2, 3 years. I think last year, 20,000 women in the United States chose to freeze their eggs. So still a very small number.
So for like the 18-year-old men who are listening to this podcast, for me, 6 months ago, what is egg freeze?
What do you mean?
So egg freezing. So I guess, uh, I guess I, I actually don't know the difference in terminology, but I know from experience there's 2 ways to do it. One, uh, a woman just freezes her eggs and then when she's ready, uh, I don't—
yeah, I guess. Why does it feel like we're having the talk?
It's like when a man and a woman love each other very much.
Birds of the bees.
I was a, I was a participant in this. And so I guess you could, you could freeze just eggs. And then eventually when you like meet a husband or you meet someone who you want to like mix it with, you mix it and they stick it upside the women. And then like 9 months later, hopefully she has a kid. Uh, the other way you do it is you freeze embryos, um, which is a process that I went through, which is, uh, awesome. But every, like, leading up to doing it, I have to bring my sperm to the doctor, uh, like 30 minutes after getting the sperm out of my body. And you just have this ultimate look of shame. And I remember my wife and I have debated what is more embarrassing and shameful, like when a woman has to go to a gynecologist or when a man has to like donate sperm.
Uh, it's like, it's like my son comes out, like I haven't seen him in a little while and he's like a 3-year-old and he just comes out of somewhere and he'll be like, I did a bad thing. That's you walking into the hospital holding a cup of sperm.
It's a, it's a horrible experience. And so, Yes. So that's what egg freezing is.
Somehow we made this about the dude side of things, but I think for the women it's a little bit harder. They have to like literally take shots and like harvest the egg. It's like a very hard process on your body anyways. It's also very expensive. So I think traditional egg freezing, one cycle is something like $10,000. And so there's a startup, CoFertility. What they came out and said was, hey, free egg freezing. How is it free? Right. And it says, by the way, they had like this billboard or this ad, which was, it says, the best time to freeze your eggs is often when you can least afford it. That's why we're making it free. And I don't know if you've ever heard that phrase, if it's free, then you are the product. Yes.
Basically. Wow.
The biggest version of this. So what it's doing, what they're doing is they're like, we will freeze your eggs for free, but we keep half. We keep half the eggs. And this sounds a little crazy when you first hear about it, but I actually think This is pretty smart. What they've done is they bundled together two things. They bundled together egg freezing and egg donation. So some people do donate eggs, they get paid for it, and they're willing to do that. They go in eyes wide open and they choose to do that. That's great because other people need eggs. And so they bundled it together where now you can, you can get free egg freezing if you bundle in and agree to donate half the eggs upfront. And on the other side, They go and charge people who want eggs and they charge them $13,000, $13,700 to, as their matchmaking fee to get you your eggs. And so I think this is a pretty smart and disruptive model. What do you think of this idea?
Insane. I think this is insane. Not in a bad way necessarily. I think it's a bad way for me. I don't want to do that, but I think that the whole process of that, that I went through, that my wife and I went through. I think it was like something like $60,000 and her insurance paid for it. But if you can't afford it, you're screwed. This is pretty wild. Do you think this could actually work as a business?
I think this can totally work. I think there's a lot of people out there who, like you said, they don't have the extra tens of thousands of dollars to freeze their eggs. And so if your options were don't have— don't freeze it or this free option, but you're going to donate some of your unused eggs and you'll know that they're out there in the world. I think there's a lot of people who will take that. And by the way, I think that because this is controversial, it's going to get so much free press. Like, there is something almost strategic in doing a sort of controversial, taboo, almost a naughty idea. And you will get article after article, online argument after online argument. And all it really does is it pushes away the people who were never going to be your customer. But it educates the people who actually might be your customer because it's going to be so noisy.
Dude, let me tell you a related story. So she said I could name her name, but you and I have a friend named Kat and, well, she's, I'm really close with her. I don't know if you're close with her. I think you've just met her once or twice. Um, her and her wife wanted to have a kid and it was, and although she's successful, she's a, she's a frugal woman and it was really expensive to do this., and we all have a mutual friend, David, who's this wonderful man. He's like a 6-foot-tall, good-looking, nice, smart guy. And Kat and her wife Emily were like, David, would you like to, uh, you know, could we get some of your sperm and have a baby? And they looked into like some of this egg freezing stuff and it was really expensive. And they were like, can we just kind of do it yourself on this one? And so, uh, they didn't have sex. They didn't have sex, but he would come over in the morning, uh, like when they were ovulating and he would do the deed in the bathroom. They would get the sperm and they would just kind of, uh, I guess they had like a do-it-yourself kit at home. Speaker? Yeah, I don't know, like a turkey baster. I don't know. Like, and, uh, they did that and in the very first try, cat got pregnant. Now she's got a beautiful 2-year-old and it worked.
It's a, what did you get? Like free lunch? What, what happened? What did David get out of this?
Nothing. He just, he's like, uh, he's like, dude, it's like on paper.
That's how she's a great marketer, dude. She is a great entrepreneur and a great marketer. She convinced this guy to do this for free. You know, she used her, uh, her marketing skills.
Well, they have a beautiful kid and he's like the uncle and his parents sort of act like a mixture of grandparents and uncle and aunts. And it's like a wildly awesome relationship and everyone's happy with the ordeal. And so this whole like co-fertility thing. I think this is another interesting solution to the same problem. Similar problem.
What's the, what's the slogan for Austin?
I don't know. What is it? Keep Austin weird.
Austin weird.
They kept it weird.
You guys are doing your part out there.
They kept it weird. If I told you this solution, like, oh, it's just possible. You'd be like, that's crazy. These 3 people, it's, I guess it's a thruple. I don't know what you call this. It's perfect. It's like the most harmonious relationship I've ever seen.
Yeah. It sounds actually very healthy, to be honest.
It's very healthy. So I like co-fertility. How did they raise money?
Um, I, I, you know how I'd think they raise money? They have the, like, you know when you see somebody who goes to the store and buys a new outfit and you're like, you're looking great, but like can't really put your finger on what's new about it. And then you see the tag on their jacket still, you're like, oh, this is, you got a new jacket. That's what you went shopping and got a new jacket. Their fonts are all the fonts of like a Red Antler brand where you're like, oh, you launched, but you paid for fancy branding up front. You got a font that I can't find on dafont.com in the free section. And so I know that they got some money somehow to do this.
Uh, this is pretty cool. Would you do this?
Yeah, why not? Uh, also it's hilarious that like on this huge life decision I was like, why not? And then for the first time in my life my brain responded with several reasons why not. Usually why not is met with nothing. So they did some— I was reading some study and it said that 83% of egg donors share that they would donate again, and only 2% regret their decision. Which, forget about, you know, surveys I think are often prone to just like finding data that supports the point you want. But I do think it's an interesting, uh, that's an interesting statistical thing, which is what percentage of people regret X decision? Like, I would love to see a list of life decisions and then the regret score. Um, you know, for example, Burning Man is this thing that I've been on the fence for, for like 11 years, even though everybody I like and trust in my life who goes is like, it's the best. What are you even talking about? What's the decision? Just go. And I don't know anybody that's regretted it personally in my life. I'm sure there are people because there's like a million people that go every year, but I just kind of want to see for life decisions the regret percentage for each thing. I think that would be very illuminating. For, uh, somebody who's trying to make good decisions in life, don't you think?
Wait, so why haven't you gone to Burning Man?
I'm scared of drugs.
Yeah, same. But you just literally said no one that you've met has regretted it.
And when I tell them that, they're like, so then don't do drugs. I'm like, but I thought that's what you do there. And they're like, no, that's just one of many things. You don't have to do drugs. What kind of dork-ass response was that? And then I'm like, okay, I'll think about it this year. Then I go home and I'm like, I'm still scared of drugs, I'm not doing this.
My square friend, like my, I'm straight edge. So my other straight edge friends and his girlfriend, they're like, hey, we went to Burning Man. Burning Man. It was awesome. You guys wanna see some pictures? And we were, I was looking at pictures and swiping through their phone and it looked a little bit normal, a little bit normal. And he's like sitting over my shoulder like, yeah, this is this cool guy we've met. Like, here's this cool van that we saw. There's us just like doing this. And then there's a picture of him butt naked, like with a full frontal photo with his arm over her, who's also naked, and they're just like smiling. And then he's just like, yeah, there we were, like celebrating this thing.
The weather was great that day.
Yeah. And then just swipe. And I was like, okay. And I saw that. I was like, I don't know, man.
Burning Man. Those might be the scariest words in the English language. Do you want to see some pictures from my Burning Man trip? It's like, you know, right before you go to Six Flags and they put the, the, the like roller coaster thing and then thing comes down and clamps you in. That's, that's how I feel when somebody says you want to see the pictures from Burning Man this year.
Um, I want to do another parenting one before I get to the parenting one. Can I do a quick little thrill the shill? Thrill me, baby. This is something I'm, um, I'm proud of. So at Hampton, we have access to like 1,000 founders and we've been doing these really cool surveys where we surveyed— Hampton, it's my community, uh, for CEOs, uh, average CEOs doing about $25 million in revenue. You guys can check it out and you apply. We interview everyone. Fun fact, my partner Joe and I watch 100% of the interviews and we're the ones clicking the approve or deny button.
Um, so like the Harvey Weinstein of the process, would you say?
No, I would not say that. I would not. So check it out. Joinhampton.com. But here's what's kind of cool. We did this survey and I was like, let's do wealth where we like ask all these people all these questions. Like, you know, how much money do you have? What's your monthly burn? All these questions that people are embarrassing to have. It was cool. But then we were like, let's actually do it by industry. And so we're doing it by software. Uh, we're doing it by all the different industries. So what other industries are there? Software, marketplaces, health stuff. Uh, we just did one on e-commerce and if you go to joinhampton.com or just search, just actually, this is easier. Look in the YouTube description or just Google Join Hampton and then blog and you'll see our blog and you'll see all of our reports. Dude, we did this thing with e-com owners where we asked them all about their revenue per employee and, uh, their, how much profit they're making, how much they're paying themselves, things like that. Did you see that thing we released?
What was the revenue per employee?
I'm curious, dude. It was pretty good. So let me read you off some of the—
wow, what a satisfying answer. Thanks.
I'm going to read it.
I'm going to— the chart just says pretty good.
Yeah, deuce. It just says deuce.
I'm going to read—
I'll read you, uh, off. So we had about 50 people reply. The average revenue of the responder was $25 million. Average revenue per employee, $1.35 million. The average founder paid themselves $385,000 a year. Net profit has grown consistently over the last couple of years, and we break down each company's net profit. And shockingly, I guess this isn't shocking to you and I, fucking Meta, dude, it's still the best platform for buying ads for e-com.
Dude, it is, except for there's a couple of people just dominating on TikTok shops right now. But let me ask you something. On $1.3 million of revenue per employee. So, right, so $1.3 million of revenue per employee. I would say that a good e-commerce brand is doing 20% profit margins on that before taxes, EBITDA, EBITDA margin. Um, and I would say the average might be between 10 and 15%. So let's just do a little math. So $1.3 million and let's just use the 15% number. What is that? $195,000. And so I would guess the average wage might be $100,000 for these e-commerce stores, maybe $120,000. And so roughly $50,000 to $70,000 of profit per employee.
And so that's why the 30th and final slide of this presentation where we go through all the numbers, it just says e-commerce sucks. It just says don't, don't. But if you're listening and you are into e-commerce, check it out. Just look up, uh, you go to joinhampton.com/blog or just search Hampton blog and you'll see all the reports there or in the YouTube description. Now, can we talk about something that it was your idea to cover this person and I'm now obsessed with them? Who's that person?
Dr. Becky.
Dr. Becky. I love Dr. Becky. I more so love the idea of her than maybe I actually love her.
Explain what you, who she is and why you love her.
I'm going to give you like the 2-minute breakdown of who she is. So Dr. Becky, I believe her real name is Becky Prince. Now her name is Becky Kennedy. Grew up in Scarsdale, New York, which is like a really nice suburb in Long Island, on Long Island. It's like 45 minutes outside the city. She had a bunch of issues as a kid, so she had like emotional issues that she wasn't sure how to handle. Uh, eventually that developed into anorexia and she starts going to therapy at age 8 or 9, gets obsessed with therapy, goes to Duke and Columbia to study psychology. And then starting around the pandemic, so 2020, she just starts doing this content on Instagram. And it, I looked at her first post, it feels like very impromptu. So it's like her just kind of like actually like this setting or like your setting next to a wall, just with her camera up and answering questions about parenting of which she studied at Duke and Columbia. And it takes off. And one of the reasons it takes off is she's very charismatic. She's very cool looking. She's got the it factor. She looks like someone who you could trust and she grabs your attention nicely. Although it's sort of like Andrew Huberman. Where he's not doing anything like thrilling, but there's something about their personality and the way they look where you're like, I just want to trust and listen.
I trust. You just trust this person.
Yeah. I just want to listen to you. Now things kind of take off and she's like, let's turn this into a thing. So she creates this business called Good Inside and it's a community where you pay $300 a year and you, uh, you get access to like this area where you can talk to other members and you could ask questions and they also have a bunch of, uh, She calls it good inside clinicians, but people who I guess who she's trained, who are talking and answering different questions. And now it's a thriving community. Behind the community, you also can see videos of her, things like that. And by the way, do you know who she partnered with to start this business?
I do. I just found that out right before this pod.
I was like, did you catch that?
I was like, Erica Belsky. Huh. Is that a common last name or is this Scott Belsky's wife? And it turns out it's Scott Belsky's wife.
No way. Scott Belsky's wife. End of the pod.
Yes, Scott Belsky, who's now the chief product officer at, uh, Adobe. Uh, I don't know if he's actually been on the pod, but we both admire him. Just a wildly successful, cool dude. And that's her partner. And did you also know that they've recently raised $10 million for this business, Good Inside?
No way. I did not know that. And this is only like a few years old. I think it's like 3 or 4 years old, but you missed the headline. The headline of the story is Uh, the product, uh, this is their product. Good Inside has about 50,000 paying members. So their membership community is probably doing around $13, $14 million a year in revenue, giving parents parenting tips, parenting advice from two clinical physicians and mothers, right? Uh, that's kind of amazing. And this is amazing. It's an interesting market. There's actually a bunch of these. So I don't know if you ever saw, uh, Taking Care of Babies. Do you know who that is?
No. What's that one?
So if you just get her, her, her name is Kara and then her handle is taking care of babies. We had bought her course like for a hundred something bucks when I had my first kid and she has basically like a sleep training course of like train your baby to sleep without, without crying it out.
I did this too.
I bought her $100 course. I sat down, I did it. I looked at it, I watched it and I was like, yeah, we're not going to be able to do that. But either way, it was good material and there was some good insights in it. And basically the funnel for these is all the same free content on Instagram or YouTube. And then basically like they're just building trust on Instagram really where it's like, here's who I am. Here's what I do. I'm going to put up stories and tips every single day. They build up trust, trust, trust, trust, trust. And then they have the free— or sorry, they have the paid either membership or educational product underneath it. The info product, Taking Care of Babies was making somewhere between $10 and $15 million. This was not even like a company. This is just like her. $10 to $15 million a year in revenue with fat profit margins because she was spending nothing on marketing and basically had no, you know, a small team or no team. And then she got canceled. Unfortunately, she got canceled because she donated to Trump, of all things. Like, pretty crazy reason to cancel somebody. But the moms sort of en masse unsubscribed. And then all the mommy groups on Facebook, they were like, we're not going to support her if she's going to support Trump. And so she kind of got knocked down a couple of pegs. I think she's still out there doing fine.
But wouldn't like the Trump people be like, yeah, I'm in even harder?
Well, I think there's probably some lean and the like, who uses these products and who pays for these products, which is like maybe more coastal moms and whatnot. Like it might be skewed in that way. I'm not sure, but, but you're right. Yeah, it doesn't fully, doesn't fully make sense. But I remember reading that there's other ones. Ben had bought this one called Big Little Feelings. I think they sold 200,000 courses at an average of $100. So $20 million in revenue. Um, turns out mom influencer, great career, great career if you could pull it off. And it's a very simple career, uh, not easy to do. Let me put that, put it that way, but very simple. Free content on Instagram lead to paid thing. But obviously these people have expertise. Maybe they've been a doula for a long time or they're a clinical physician or they're a clinical psychologist. Sorry. Um, they have, they have to have some, you know, expertise or authority in the domain, but You know, one of the things I really liked about Dr. Becky's content, by the way, is I think intentionally she makes it relatable. So she's not wearing a lot of makeup. She's not sitting in front of a very well-produced thing, which of course they could afford it at this point, but she'll be like on the go to pick up her kids from soccer practice, just take out her phone when she has the impulse about some topic and say it. And I think it makes her feel like the kind of relatable but aspirational mom who like just finds time, doesn't have time type of thing. And, um, I think there's something strategic about that, that, that's pretty cool.
So that's what I wanted to bring up. So Dr. Becky is, I think, a very, very smart woman, and I think she runs with very smart people because I was looking into this woman a little bit, and this sounds like I'm hating. I don't mean for it to sound that way. I'm a big fan of this person, and I think they're the real deal. I think that this is far more put together than it appears to be. It tries to look like it's kind of thrown together and, and it's this thing. But Dr. Becky lives on the Upper West Side of New York, where an 1,800-square-foot apartment is typically $5 to like $7 million. And she also like, uh, went to the best schools. She's from Scarsdale, which is a beautiful, uh, fancy community, uh, in New York. I think that she runs around with you know, people like Erica Belsky, these people that are top notch, top at their game. And they, I think that it was definitely like a, we're going to do this and we're going to do this and we're going to do this. Not, oh, one thing just happened to turn to this, to this, to this. Like she's executing this plan perfectly. And so this, again, this sounds like I'm being negative. I'm not, there's nothing wrong or unethical at all about any of this. Uh, but it like, I think this is like a perfectly executed plan is what I think it is.
Yeah, I think for most content creators, it starts organically, right? Because you don't sit there and think, and now from scratch, I shall become an influencer with millions of followers. It's not really how most people start.
I don't think she did.
I don't think so. We can scroll back.
Let's scroll all the way back. No, they deleted old posts. I already found the old posts. They've been deleted. I looked on YouTube. There aren't that many old posts. And here's what I think. I think that if, had you met this woman 10 years ago, like it would have been very, you could have just had a conversation with her and been like, yeah, I think you got the it factor. Like this is like a type of person who I see her talking. I'm like, dude, it's very obvious that you've got like whatever these popular influencers have. Let's just put a little bit of money behind this and turn this into a thing.
Well, I like that you've gone Coffeezilla on this one. You're like, hey, wait, pause that frame. That's Oprah in the background. She's friends with Oprah. You're like, if I try to find the thing, I think my personal belief, I don't think it's plotted, but I do think it's strategic, meaning I think there is a lot of, uh, to make something look effortless, to make something look authentic and, and, and, and real. It actually takes some effort to make something look effortless, and it takes, um, some thinking to make something look off the cuff in a way, right? And, um, and often it's not that you're manipulating people, but it's you're intentionally saying no to certain things that would ruin that vibe, that would break that trust, that would break the fourth wall or whatever. And so I do think that they've done a great job of that. But there is the negative version. Remember those stories about Sam Bankman-Fried where they were like, hey, you're going to meet with whoever, this investor today, and they're in the boardroom and they're like, Sam, you look good. He's like, thanks. And they're like, no, you need to look like a dork. And they were like, get this man some jorts and somebody ruffle up his hair, make it look like he hasn't slept in 6 weeks. And there was an article that basically was like, we basically knew that people pattern match. And if we can look basically like Zuckerberg and a bunch of the other, like, kind of prodigies who are awkward, who don't know how to dress, who— they have these weird personality quirks. Okay, let's play up that he's vegan. Let's make him drive this car, right? Like, there was intentional choices along the way to either make him look more like that or prevent anybody from polishing up those rough edges. They're like, no, no, no, the rough edges are key. Let's keep those. And actually, let's put those front and center. Yeah. And there was, there were stories that came out and it's very rare for those stories to come out because even the people that pull it off, they, they never have any incentive to come out and like acknowledge that. It's only when somebody has a complete downfall that his closest confidants come and betray and be like, yeah, that actually happened.
By the way, I am not remotely implying that Sam Bankman-Fried and this woman are even in the same. I'm not all I'm saying. I like this lady. I trust her advice. I think you are not getting an invite to her Hamptons party this summer.
Right.
What I'm saying is I I think that she's just a shark when it comes to business, which is not something that would— you would necessarily want to portray when you're trying to be a mother expert. I'm on board with Becky. I think she's the best. So I'm on board. What, uh, is there any niches that you think are interesting other than parenting for this model? Because this model is the most basic, simple model.
Explain the model. What do you mean by that?
So the model is, um, Well, I don't know why they raised money for this because typically you don't need to with this model, but the model is we'll use Andrew Huberman as an example. So, or we could use what I've done, whatever. But the model is you get popular on the internet and become a thought expert. And then you get popular oftentimes through having a blog, sometimes a podcast, sometimes on social media. And then you create a community. You create a community that is, uh, something like $200 or $300 a year. And you try to get as many people as possible. And then you also host events that cost money. And then you have courses that are between $1,000 and $2,000, something to upsell because you want your pricing to be something cheap, a little bit more expensive and a little bit more expensive. And then you just focus on getting more and more popular and creating this business all around a lifestyle, an idea. For her, her idea is, um, uh, what's it called? Good Inside. I think that's like her, it's like, that's like a thing she teaches called Good Inside. For other people, like, um, there's Mark Sisson who did this with, um, uh, Good Apple, which is about like a health company. There's a lot of people who have done this in a variety of niches where it's thought leader, blog, book, course, community, and then like some type of higher tiered membership.
Yeah, definitely. I like Miss Excel did this with just teaching people Excel. Excel expert, create free content, leads to courses, leads to info products, leads to membership. Uh, I think this playbook has been out for a while. And by that, I just mean to say, I don't think this is, um, I don't think you have to do the figuring out. All you have to do is the execution, which is nice in a way, but it also means it's kind of competitive. It's not as easy as it might've been if you were early in the figuring out phase, but you could definitely do it. We've done it in a way. Um, we just gave 3 examples in the parenting niche that have done it. MsExcel has done it there. There's people who've done it in the you know, the V-shred type of model that have done it in the guys bodybuilding.
What's V-shred?
V-shred? You know, you don't know what V-shred is?
No. What is that? Involve like the V of your abs?
Yes, yes. The Dorito body, baby. You want your, you want your upper body to be shaped like an upside down Dorito. You don't know who V-shred is? That blows my mind, dude.
What's V-shred?
It is the perfect intersection of dudes shirtless successful businesses and internet affiliate marketers. I can't believe you don't know who this guy is. That is your— that's your Venn diagram.
Sign me up.
You don't know who V Shred is? Oh my God. All right, so let me give you a little V Shred story. So you do know this guy. As soon as you see him, you're going to know this guy.
I'm on his website. I have— I don't— I've never seen this before in my life.
Basically, this guy was super jacked guy. Who then runs Facebook ads. You click the Facebook ad and it takes you down a funnel. And his funnels are pretty well known in the internet marketing niche because it'd be like a VShred click funnel and it would be usually a quiz and it would take you through a quiz of like, I'm a guy. It's like, do you want to get jacked or get abs? And you're like, oh man. Or it's like both. It's like, give me both. And then it'd be like, what holds you back? Is it eating poorly? You're like, yeah, it is eating poorly. How'd you know? And then you just keep going down this funnel. It's like, I'm going to give you a personalized thing. And then it gives you a personalized thing and you pay $99 for it. And he basically ran this funnel, um, and made like, I don't know how much money this guy made, but I'm pretty sure I read at one point this was like 9 figures, but I think I might be mixing up Kino Body and VShred.
Yeah. So how, look at this blog post, how VShred used a quiz funnel to drive $200 million in revenue. I don't know if this is like legit or not, but in 2022, they had 5 million monthly visitors on their website. And, uh, yeah, this guy just basically dominated with, uh, with Facebook ads for the, the health and fitness niche. Now what he was doing was he was using ads. He was still an influencer, but he was like, cool, I'm going to pump ads. And I have this like funnel that was basically the most simple click funnel in the world. Like you go there, literally we could show this on the screen. It's a progress bar. And then it just says, are you a man or a woman? And it was like simple, like A or B type of answers. And you click, you click, you click. And then you kind of want to see. What's the end here? And then they'll show you, like, at the end, it's like, before he sells you the thing, he shows you like 5 transformations. Like, here's this nerd, now he's jacked. Here's this fat guy, now he's skinny. And it just shows you like 5 transformations. And then it's like, do you want that shit or not? And then you buy it.
Dude, imagine them just describing it at their meeting like you did. So we're going to show them a nerd, a fat guy, and then we're just going to say, want this shit or not?
Where are we going to get a nerd? Take your shirt off right now. Go and take a picture. It's you. You're the guy.
Yeah, yeah, tell the story. Okay, this is like a full— this is a full circle story. So have you, have you seen, have you seen what the guy, that guy Isaac's doing? The guy who we talked about his mini katana brand.
What's his last name?
I have no idea what Isaac's last name is. Isaac mini katana guy, sword guy. And we talked about him before because he had taken a product that was super niche literally katanas, like, I don't know, Japanese swords. Swords.
He sent me one.
Yeah. And they're called mini katanas, by the way. This thing is like 6 feet long.
It's so long.
It's not mini. Nothing mini about it. You know how pissed my wife was that we got this giant sword in the house now? And I'm like, I don't know. It's supposed to be small. I don't know what happened. And they couldn't run Facebook ads or Google ads because you can't advertise weapons. And so what he did was really smart, was he basically got content creators to make cool. He turned his disadvantage to his advantage. His disadvantage was I can't run ads. His advantage was I sell a cool product, swords, and there's a lot of cool content you can make with swords. And he just used YouTube and TikTok to go viral many times, and he built it up to like $10 million or so a year, basically like $10 to $20 million a year in revenue on the Katana brand. But of course, surprise, surprise, there's not a lot of repeat purchase in the sword niche, right? There are some collectors, but for most people, most people don't want a sword. Of the people who want a sword, you might just want one. You might not want to fill your house with swords. So it was not a great e-com product. But what's he doing now? He switched to—
hold on, before you get to what he's doing now, you've missed a few points about Isaac. So Isaac, I listened to a podcast with him. He was like, uh, he did Postmates and like freelancing and things like that. And then he's like, I'm going to start a business. And so he was like, yeah, we can't, like you said, we can't advertise, but you didn't say how big his channels got. So basically he was like, I'm going hard on content. And so he gets 1 billion views a month across his network of YouTube channels. And so his main channel on YouTube, which only launched in 2022, has 8.7 million subscribers and 5, uh, oh, like, and billions of views. And this is like not their main product. Their main product is the swords and they're just using this as marketing, but it's, they knocked it out the park.
It's an incredible example of marketing. I've used this. I've used, I've learned some things from Isaac and used them in my business, um, that have been very effective. And it's just a different way of thinking about marketing. So, but what he was doing was he would say, all right, how do you sell a mini katana? You can either go to people who already are collectors. That's a really, really small market. You go to people who might be interested. Why? Because they have interest in anime and different, like, interest overlaps. Where do they hang out? Okay, they hang out on TikTok and on YouTube. All right, cool. How do I actually get them to want my product? How do I build desire for my product? And what he did was instead of saying, here's the sword, here's the features, here's how the handle looks, here's how sharp it is, whatever. He's like, do you think I can cut this bullet in half? If I shot a bullet at somebody at this ninja, do you think the ninja could cut it in half with a sword? That video has like, I don't know, 10, 20 million views. It's like an insane video where a guy literally chops a bullet in half as it's flying at him. Using a sword. And, um, then he does another one where it's like, which is kind of like a weird, that's like a weird thing.
That's like saying like, if you punch me, me saying like, told you my face could stop that. Like, like the bullet aims at the sword. Hurt your hand, huh?
As you bleed. Um, he also did one that was like another marketing thing I really liked of his was how do you not mention the product in a way that drives the comments crazy? So he started a video that was our, not he, but like one of his creators started a video that was like, cooking a steak. So you think it's a cooking video and it's about a steak. And then they put the steak on the cutting board and then they take a giant katana and they cut it into slices, but they never mentioned the katana. And every comment was like, uh, are we going to talk about him using an actual sword to cut the steak? What the hell was that? And the comments drive the virality. And it was, if he had said, now watch me use this sword, people wouldn't care. It's when he didn't mention the sword that all the comments have to talk about Bro, what is this? And it's that type of social engineering that I think was really, really smart. All he needed was a better product. I think he might have a better product now.
And so he starts to sit down and he's like, all right, so my business got to like $10 or $20 million in revenue. That's not enough. I want to go to $1 billion. And so he shared out, he goes, in late 2022, I stepped back and I said, I need to hit a billion-dollar company, or I want to make a billion-dollar company. Here's my 5 requirements. Would the content playbook give us a severe unfair advantage? Does it have a huge TAM, meaning could a 1% win be a massive outcome? Is there some— is this something that I'm personally passionate about? Does this have a moat, sort of like Minikatana Store already had, which is like making swords are really hard. So if I could figure that out, I have a moat. And then finally, the product doesn't 100% rely on marketing. Because I want tailwinds. I want, I want to like catch a wave. And so he said, what can I launch that fits that? And so what did he launch?
He launched a freeze-dried candy brand called Kanpai Foods. And it's basically a candy brand and it's, I don't know. Have you ever had freeze-dried candy? I've never tried this.
I don't think I've had this. I don't really know what it is.
All right. So here's what it says. Freeze-dried process removes all moisture from the candy, leaving behind a perfectly crunchy treat. So I think it's candy that's crunchy like a chip, basically, and light.
So it's like a gummy bear, but it's light.
Yeah, exactly. It's like just the sugar. And so, by the way, this is a great example of one of the most valuable insights that I ever had on the podcast. When Alex Hormozy came on the podcast a long time ago, I don't know where this was. He first came on like 3 years ago. And Hormozy puts out a metric shit ton of content every month. And I don't consume all of it, but this one thing he said to me 3 years ago on our podcast has stuck with me and I've repeated it to myself and many others. I actually told Isaac this at a party once when I was talking about, dude, you are doing 10 out of 10 execution on a 2 out of 10 opportunity. This was the advice I needed to hear early in my career because I started a restaurant and I tried to do all the coolest shit in the world and I tried my hardest and I was trying to bring 10 out of 10 effort. And I thought I was a 10 out of 10 talent, but I was going after a 2 out of 10 opportunity. And that's what Hormozy said, that he— that's the advice he got from Russell Brunson about his gym launch thing. They were like, dude, you're, you're an amazing marketer, but you're just using your marketing to launch brick and mortar gym chains one at a time, a couple in a year, maybe. What you need to do, that's you taking 10 out of 10 execution at a 2 out of 10 opportunity, brick and mortar, small scale boutique gyms. Instead, what you should do is take your marketing playbook and go sell it to every gym across the country. That's the 10 out of 10 opportunity. Similarly, you know, just the last segment we talked about with Dr. Becky, taking her, her expertise in children, if all she did was saw 5, 5 clients a day as a clinical child psychologist or whatever it is, that would be a smaller opportunity than what she decided to do, which was make a media product that scaled to millions of people and then charge, you know, a membership fee and make $13 to $15 million a year on her membership fees, right? That's a same skill set, bigger opportunity, or same person, bigger opportunity. I think what Isaac's done is he's taken that 10 out of 10 content playbook that he really like mastered and he switched from going to a 1— I would actually give the sword thing like honestly a 1 or 2 out of 10 opportunity. And now he's going for a sort of a 5 or 6 out of 10, maybe 6 or 7 out of 10 opportunity because he set it right. He might have had 100% of the mini katana market before, and it'll be smaller than him getting half a percent of the candy market or even the alternative candy market in this case.
What did you do with your mini katana?
It's sitting right over there on the wall in my office in a case, just in case.
Which is the problem with it, which is the exact problem with that business, is mine's doing the same thing. It's just sitting there and I showed it to 3 people.
I was just in practice every day. What am I supposed to do?
Uh, and so did he shut down Mini Katana?
I have no idea, but he should.
All right, just light it on fire and throw in the dumpster and hope no one finds it.
With that whole business, it's honestly an underrated, uh, an underrated thing is the art of quitting. Like your whole life you're told not to quit and you're told that perseverance is everything. Well, quitting, like everything, it wouldn't exist if it didn't have a function. And there is a function to quitting things. And, you know, it's easy to quit when everything's failing. The hard thing to quit is the slow burn of mediocrity, right? Like the thing that's not taking up all your attention, but it's taking up some. The thing that's not totally working and achieving your goals, but it's not totally failing. It's that middle zone is the danger zone. The things that are obviously failing are easy to stop. We stop them. No problem. The things that are working are easy to keep working. You just shouldn't stop them. It's the things in that middle zone that people are very, very bad at quitting. And if I had to give myself a little pat on the back, this is the one thing I'm good at, is being pretty ruthless about things in the middle zone. Like I had a venture fund that I was doing. I had a rolling fund. It paid me very well. And I was deploying, I don't know, close to $10 million a year to invest in startups. It was, uh, it was good. But it was in the middle. I found better investment opportunities outside of that. But it wasn't so bad that I needed to stop and I could have just let it chug along and eat away at my focus and instead just made a ruthless cut and said, I'm stopping this. And when are you stopping it? I'm stopping it yesterday. It's done now. I'm just going to stop it now.
That was a good time to use a line that I think we should make our line, which is not to toot my own horn, but beep beep. You got to say it like that.
Dude, that was so good. Have you said that before?
Where'd that come from?
Is that from something?
That's an MFM special, dude.
Once in a while you just get me. Like, you make me laugh in a way that very few people can make me laugh, dude. It is so funny. That— oh my God.
Wow. Just give yourself a little toot.
Toot my own horn. Beep beep. Oh, that was good. I don't want to do the podcast anymore. I want to end it and laugh.
That's an MFM special. Isaac, I think you're awesome, man. Sean, I think you're awesome for being a quitter. Beep beep. Dr. Becky, even though I sounded like I was being rude, I think you're also awesome. Beep beep. Is that it? Is that the pod?
That's it. That's the pod. I feel like I could rule the world. I know I could be what I want to.
I put my all in it like no days off. On the road, let's travel, never looking back.