#89 - The Man Who Gamed Uber
Okay everyone, we're gonna have a little bit of a special episode. Uh, this first segment is 20 minutes, and then after that 20 minutes it's gonna be normal. But this first segment, I found this guy a couple years ago who runs this service that frankly I thought is kind of a scam. And we— Sean and I debated. Our friend Andrew was like, hey, you shouldn't have scammers on there. And I kind of agree with him, but this guy's story is incredibly fascinating and I don't want to tell you too much about it, just listen to it. But we found this guy in India and he talked to us at midnight, his time in India. And frankly, I'm inspired by this guy. And I don't know if I agree with him or disagree with him, but I completely love the hustle. And I think that you guys should just give this a listen because it's super fascinating. Let us know what you think. Tweet at me @TheSamParr, tweet at Sean. I don't actually know Sean's handle, but search Sean Perry. S-H-A-A-N space P-U-R-I, and let us know what you think.
Yeah, what's up?
What's going on?
I'm great, I'm doing good.
So we've been talking about, um, something you built. We've mentioned it on the last couple episodes. But I'm glad you're here so you can tell people about what you've built and what it does, and we can debate a little bit about it. So Abhishek, can you give us the 1-minute version of what it is that you built?
So we are using a referral system to give customers credits which they can use to their rides or their eat orders. Now that eat order is also available. So that they'll get discount on their every order, like up to the 50% of the order auto value.
Okay, so about 2 years ago or 3 years ago, I forget when you started, I got an email from a friend of mine who knows everything. He follows all the latest interesting stuff and he loves like hackers. And he goes, there's this guy— you're in India, right?
Yes, right.
He said there's this guy in India, and I don't know how it works, but somehow he's accumulated hundreds of thousands or millions of dollars of Uber credits, and you can buy credits from him and ultimately get Uber rides for half off. So you know how Uber ride— Uber gives people, um, $10 off their first ride and gives the referral person another $10 in credit? This guy somehow accumulated massive amounts of $10 credits and you could buy his $10 credits for $5. Now, the thing that Sean and I debated was like, is this ethical? Is this wrong? Is this right? Who knows? And I don't— I think Sean was like, I think it's fine. But regardless, I think it's incredibly interesting because—
and I want to get—
maybe you could explain how this works, but from my perspective, it seems like you've got a crew of like hundreds or thousands of people taking rides and you're either— you're buying— are you buying their credits from them?
What are you doing? Explain, explain how it works.
So the US account is the, is the referrer. So I refer an Indian rider, Indian rider takes a 30-cent ride, and I get a $10 credit because I'm a US customer and I get US credit credit rates.
That's the idea. Yeah. And so for listeners, 100 rupees equals $1.40.
Right.
But that doesn't— that's the easy part, Sean. The hard part is how are you getting all of these credits?
Yeah.
Who are your writers?
No, initially I was not planning for this. I started a blog just to promote the Uber service when they came in India about 6 years ago. They launched in India, and I was just curious how it's working, how it's not working. So I was sharing among our friends, and at the time they were giving around $10 in Indian value, about ₹600 they were giving. But my ride cost was around ₹100, ₹150 from my flight to office, right? So I was using— for to use that money for myself, I started referring others. Then I started accumulating more value, more value, like ₹6,000, ₹10,000, ₹20,000. Then I was not able to use all the credits for myself. Right.
And you're doing this just by giving your link to your friends.
Yeah. I started with my friends. Then I started a blog and blog got little popular. And because nobody was sharing that thing, that thing was totally new. So it was popular. And for blogging, I started blogging like few years back, around 10 years back. So all the learning, how to make, do SEO and other things, how to make it popular, a blog, I use those skills to make it popular, make this Uber thing popular, and started getting referrals. Then I initially, I was not selling to anyone, but I asked my friends to give me their referral code so that I can give credits them for free because I was not able to use all the credits for myself. So everybody was getting credits and in like hundreds of rides, they were getting free.
Basically because Uber, like, kind of, they quickly, in moving quickly, they just, they translated the $10 worth of credits to India, even though the rides were 10 times cheaper. And so that was the initial reason you were able to stack up so many credits.
But yeah, it was very high value.
When did you start selling the credits, or when did you start making this a service?
Uh, when like my— although all of my friends got credits, they were not able to use themselves, and Uber started banning their account because Uber was thinking like they are getting credits like by some trick or something. So I was not able to fill their accounts also, so I was having extra credit. So I asked on my blog also if somebody wants this. Then they can pay me like some ₹20, ₹30 also, like mine, then small thing, because it was for me for free. It was coming to me for free. So they started coming to me, then I started selling for just small ₹0.30, ₹0.40. Then slowly I kept increasing my rates because there were more people asking me those credits. Then suddenly in India they reduced that referral value to minimum to like ₹50. Say I was selling for ₹50 and they were getting only ₹50. So nobody was buying in India, right? Then I started exploring who can buy. Then I found out that this referral works across countries, like all over the world.
So do you remember the day you realized that? Like, was it just you're sitting in your boxers at night and you're looking at it, you're like, holy shit, this actually— I can get $10 for this.
I don't remember. Yeah, I don't remember. This just happened, I think 3 years back, something. Yeah, 6 years back. Yeah, I— one of my friend was also working with this, and there is another provider, Ola, here. So you are selling for that also, all of Ola also. And my friend was mostly into Ola, and I was in Uber. So we're not competing with each other, just we are helping each other to promote this. So he also— he was also searching for some users, buyers in US, but Ola is not available in US. Uber is available. So he suggested me few friends, like few customers, and I, from my blog also, few people came. Slowly, slowly I got—
So how do you actually sell the credit? So your account has credits. How are you actually transferring those to the buyer?
I'm— I don't have any credits for me.
You get the referral code from the person and you earn them credits.
Yes, yes. Just like it's your account, if you give me your code, I will be on behalf of you. I'll refer some, some people and they'll take ride or they'll take Uber, like they'll place any order and they will get referral.
But are you still doing it? Okay, so first of all, how much traffic was your blog getting? And did you, I guess, did you rank for like India Uber signup referral?
Uh, it was coming one first place and a second position, I guess, for that keyword.
And how many people a day come to your site, or were at the peak?
Not many, I guess, per day, 1,000 people max.
Okay, so you were getting these referral credits initially from your friends, but at some point you must have run out of new friends to bring to Uber. So at what point did you find a new way to get riders in India? How did you do that?
Uh, once I was getting constant purchase, like for orders. Then I was asked— I asked my friends, like other bloggers, how they do it. Then there is a, like, in Facebook groups are there. So few people were also— they are having similar idea of, like, as me. They're also selling. I, like, talk to them and explore, like, how they are doing, how they're doing. Then I said, okay, I'll give you some money if you just manage it. With, among your friends, among your blogs, among your Facebook groups.
So somebody had said, oh, he's got a bunch of kids who will ride Uber rides all day. Like, you know, you go to a school and you say, hey, hey kid, you know, 12-year-old kid, go ride this for 1 mile, please. Thank you very much. Here's, here's ₹50. Is that what was happening? Or it really was just friends?
Because I, you could see the pic. I, you guys listening, I, I bought this and a bunch of my friends did. And what happens is you get $10 credits. And by the way, and I talked to you, I talked to you about this. When you log into your site, it's super sketchy, or it seems like that because English isn't your native language. And so it was, you know, it was clear that like you were—
I didn't buy because I got scared. I was like, yeah, what the hell this is?
I was like, it's clear this guy like is, he's trying to. And so it looks quite sketchy. And I told you this, but when you and I did it and it worked. It worked wonderfully, and I did it because I talked to you. But when you sign up, I see all these kids, like they seem like young boys, like pop up. Who are these kids?
Who are these kids?
Yeah, I'm like, this guy is going to a high school or something. He's getting these kids to take rides.
I see. So you just need a phone number, a new phone number. Hey, it's a new rider.
Yeah, it's new number is available and there are several websites, they sell just number. In number you need just OTP, just enter the number, you'll get OTP and account is created. Then take a ride and referral is available.
So were you— so it was in fact like hand-to-hand combat, kids? Like you were getting people to sign up, it wasn't from the blog?
Initially it was from blog, then yeah, to compete with the others and others, other people were there who were also selling. So the business now, did you have more supply or demand?
So did you have more rides or more buyers?
Depends on time to time because Uber keeps changing their policy and sometimes it stops everything, doesn't work. Then Yeah, buyers are there but no supply is there, right? And then it starts, supply is available but no buyers. So has Uber changing?
Uh, no, I do, but didn't call it. I contacted Uber initially. I tweeted them like, if you give me ₹100 per referral, I'll give you so many accounts so that you can show those number of accounts to someone like to get funding or something like that. But they never replied to me. Then I was not able to use myself. I started selling. No option was there. Otherwise, I was going to sell to them only, like, okay, give me some money, I'll market for you.
That's it. So you're forgetting a major part— or you're not forgetting, you haven't mentioned a major part of this. And this is a huge thing that I— it was a red flag to me, but I still did it— was A, you offer a discount if you pay with Bitcoin, and B You have to change— if you're in America, which I imagine a lot of your customers are, you have to change your account to— where was it? What's the code? Maldives. So yeah, if you're in America, you have to change— you gotta change your account to say that you are in the Maldives. Not because— I don't know why. I think— I don't know why.
I'll explain. Those were some tricks, you can say, workaround. In US, they are— in US also, they are reducing referral value. Initially it was $20, then $10, then $5. Then when it came to $5, nobody was buying from us. So we're looking for how can— how we can increase it. So we like, somehow we like, luckily we found like, if you change country, your referral will go to $10. Maybe $10 is default value in the Uber system. Like if there is no country set, it will be set to default like $10.
So you pick some obscure country and you just get the $10 as your default.
I'm giddy talking about this.
Yes, I'm smiling like I've never seen him smile before.
I'll tell you why I'm giddy about this, but first, is it— I want to make sure I say your name correctly, sorry, Abhishek?
Yes, right.
I'm giddy about this because I don't, I don't know if I agree with the ethics of it. I don't know. I'll— but what I think is amazing is how hard you hustled to do something. And I think the people like you who come up with these intricate— even, even let— and I'm not saying I feel this way, but let's say that a listener says this is a scam and you're a scammer. But even the balls that it took to do this And the operation that you built around this, I find incredibly fascinating. And I think the people who build amazing things often start out this way. And I think that— I just think that you're frankly inspiring. I think it's amazing.
100%. I think we had Greg on yesterday, and I think he was talking about like one of his earliest businesses was he— I think it was Greg— he sold a box of air on eBay, and people just found it funny, so they bought the box of air and he made thousands. It's like learning how to, uh, learning how to connect the dots, learning how to make money on the internet, learning how to tap into people's, um, you know, psychology and give them what they want. Um, you know, those are sort of core underlying business skills. And so, you know, the very first thing you said was, this is a basic arbitrage. This could have been with Uber credits, it could have been with airline miles, it could have been with any, any system that's out there. If you discover a price discrepancy or a a sort of a loophole in the way that the system is set up, you know, that's an opportunity that you can take advantage of. Now, some people will say, hey, this isn't right. So, you know, my brain goes down this checklist. First I say, is this morally or ethically wrong to me? And, you know, is anybody being harmed by this? From my understanding, nobody's being harmed by this. Was that correct? Or is that, you know, are you sort of exploiting these high school kids and then sending them on rides to the mountains and then they have to walk back or something?
No, no, no, they're getting pocket money in a pocket expense, right?
And then the second thing is like, is this illegal? No, this is not illegal. Is this against the terms of service of Uber? Maybe, but it's on them to sort of enforce that if they're gonna allow this. Sounds like you literally reached out to them, you started this with a pure intent, which was to promote the Uber service, right? If I take you at face value, then I see nothing wrong with this myself personally, but We'll let other people be the judge.
I think I'm on board with this. I think I'm on board with this. I just think that because you're not a native English speaker, the site admittedly didn't come across wonderfully. But it's crazy. And I tried to help you with it. I think I told you, right? I go, hey man, your site looks like you're not using the right words. And I even rewrote something for him.
Yes, yes. I keep trying. I keep updating it. But yeah, obviously.
So, Abhishek, what are you doing now? You said that this is going to end soon or something like that. What makes you say that? And then what's next?
No, Uber keeps changing the policy. Like 2 days back they said like now referral, Uber ride referral is stopped totally all over the world, June 29th. So it's stopped now. I need to look for some— I'm basically software engineer, so I'll find some other things to do.
Did you, uh, how old are you?
I'm 35.
Did you, um, how much does your apartment cost to rent a month in US dollars? You know, in US dollars?
Yeah, I think a few hundred bucks or something. Yeah, yeah, something $300.
And it was in your service, $350.
How much? $350.
Yeah, it was revenue, not all the profits. Yeah, but was it close to 50% profit? Yeah, close to 50% profit.
Yeah. So you were doing, um, ballpark, uh, 120K a year, 50 times your monthly rent, right?
Did I do that right?
Uh, anyway, a lot. I don't know if I did that math right, but anyway, um, why did you grow up poor?
Uh, well, yeah, kind of lower middle class.
And do you consider— what are you, what are you now?
It's still the same. Not— I'm not spending any much. I don't have a car. I don't have apartment, like it's rented apartment.
You're wearing an Apple Watch, I think. You, your apartment looks pretty cool. You know, I would say you're doing all right.
You just fascinate me, man. I, I would wonder, are you, are you gonna do— I'm not— I would call this illegitimate what you did, because it is a, uh, I don't think it's wrong, but it is like a short-term thing. Are you gonna build something? Why don't you build something, um, that's huge, like something that can last? Because you're, you're pretty You're fucking awesome.
Yeah. When you think about what's next for you, do you think you'll try to do something similar, or do you think you'll try to do something that's different in some way, like, um, you know, your own service, a different, you know, something that has more enduring long-term value?
Yeah, definitely different from this, because yeah, in this field it's keep getting like, it's depending on someone else's business. If they're not doing good, I'm not doing good. It's depending on something.
So Trying to separate from something with less platform risk. Okay. All right. So Abhishek, here's what I want you to do, man. Uh, we're going to wrap this one up, but I want you to keep in touch with me and Sam. Let us know what you get working on next. We'd love to support you and help you, you know, help make that whatever that next thing is successful. And my hope is that you come back on in 6 months or a year and you say, hey, remember me? I'm the Uber, Uber Pro guy. Okay, here's what I did next. And it's even bigger and badder than what you've already done.
And, uh, the website is uberpro.in, right?
Yeah, right. Great. UberPro.in. Yeah. People like that, it's like, yeah, it's scammy site due to the .in. It should be .com, then they think like it's legitimate site kind of.
It looks a lot better. I just went to the website right now. It looks a lot better. Your translation has gotten significantly better. It looks great. It just, you're a fascinating guy, man. You're cool.
Thanks for coming on. Thanks for telling your story.
Okay, thanks. Have a good day. Thank you.
All right. We gotta say good night. It's midnight over there.
We gotta say good night.
Good night.
Sweet dreams. Dude, you're awesome. I appreciate you coming.
Thank you. All right.
All right. That guy's crazy. I love him.
Such a great little story. I just enjoy hearing those. Anytime I hear something like that, I love it.
I have a feeling that little segment is going to be very, very popular. I would love to hear what people think. I think that that was fascinating. People can't see me, but I am smiling a lot.
Yeah, it's like Sam's wedding day over there. You just need to send in a photographer. He's ready to go. All right, what else? What else you want to talk about today?
Hold on, I want to wrap this up. This guy, I— here's why this is fascinating to me. This guy, I love these guys who come from nothing and just do all types of crazy stuff to like build cool, interesting stuff, even if it is maybe unethical. I'm like, I'm gushing over this guy. I love these types of people. Um, okay, you want to move on?
Yeah.
Okay, uh, first thing I want to talk about: people fleeing cities. Um, I posted about this in the Trends group, I posted about this on Twitter. I've gotten roughly 200 to 300 replies. I put my 30-day notice in to my apartment, and I'm located in San Francisco. Um, people, uh, a report was released for June numbers San Francisco's rent is down another 11%. Sean, do you think that cities are going to change, or like some of the major expensive cities, so New York, San Francisco, I don't know what else, do you think that they're going to change forever?
Forever is a long time. It's hard to say. But I would say that like, you sort of have to ask, okay, what would get it to return to bigger and badder heights than it was. And I think what was driving the San Francisco value sort of originally was the, like, kind of culture and the, like, you know, the eclectic mix of people that lived in San Francisco. This was like, you know, sort of early days of San Francisco. That went away as the core reason people came to the city, and then it got replaced with tech. And it's pretty clear that the tech movement has migrated away from Silicon Valley, not just because coronavirus, but in general cost of living getting higher and higher, higher, as well as just winners coming out of Sweden and Israel and other places, it became clear, like, look, you don't have to be based out of Silicon Valley to A, raise money, or B, be successful. New York has had winners, LA has had winners, and a bunch of European countries have had winners. Atlassian in Australia, Canva in Australia. So I think already that was happening, and this was just a turbo. This was an amplifier. So no, I don't think that San Francisco, for example, is gonna be the hub for— is gonna be a bigger hub than it was in the past few years. I think it'll still probably be the biggest tech hub there is. It's just, it will be smaller in size. Some of its weight will have gotten distributed out to Austin and New York and LA and other places that are benefiting from this.
I believe that the numbers are being underreported at the moment. And it's strictly, What's it called when you just hear stories? Anecdotal? Yeah, because I posted in this group and I had James Altucher replied and he goes, half my building's vacant. Another person said, two-thirds of my thing is vacant. When I try to book a moving company, they're packed. They're packed.
Were you the one who posted like you called a moving company about moves from California to Florida? Was that you or was that someone else?
Not me.
I think it was either Dave Grossblatt or, or you, or I forgot who it was. Uh, maybe it was my friend Kumar. Somebody posted they had talked to somebody about, um, they talked to a moving company about moving from— moves from California to Florida. And, you know, normal volume was, let's say, 50 in a month, and now they're doing 500 a month, and they can't keep up with them. They're turning people away because they just can't handle as many moves that are migrating, you know, to, to greener pastures. And so, you know, these are the leading signals that you see. And it makes sense. Like, I myself moved out of the city. I know tons of people that are either already moved, considering moving, or, or not planning on planting roots in the same way that they were 6 months ago, which is kind of wild because that's a very short amount of time for such a big migration.
Yeah, it's pretty nuts. So let's talk— let me talk about a few opportunities there, which is, first of all, When I'm moving, I'm now— I'm trying to figure out my tax situation. Which state do I— am I going to call home? And I got to— it's all about your intent. And there's a bunch of things that you can do, for example, getting a mailbox in a different state. So virtual mailboxes are kind of intriguing to me at the moment. The second thing is you have to declare to the state of California or whatever state you're leaving that you are no longer a resident. And there's a ton of manual things you have to do, like contacting the DMV. There's a few more things, whatever. And that's pretty interesting. And I'm curious what's going to happen with that. Did I show you this? The founder of Shipt, is it Shipt? It's a— it's that thing that sold to Target for $500 million. It was like a—
I'm not familiar.
Okay, so it's called S-H-I-P-T. Okay. So it was basically like Instacart but for the South. The founder's name was Bill Smith. He sold it for $400 or $500 million, huge win. And he has a new company, let me— it's called Landing. And what Landing does is they have a network of apartments across the country and they're all pretty similar and you pay a fee and you get access to all the apartments. And so if you go to their website now, You can go to—
So if you type in—
Dot what?
Let's see. I typed in Hello Landing, hellolanding.com. Okay. So it's pretty fascinating. It's super interesting. So they're clearly appealing to these 20, 30-year-old young people who have a little bit of money. You can sign up. They've got 13 major cities. You pay $200 for a yearly membership, and then you select a variety of furnished apartments, and then you get like a slight discount on, uh, staying there for a month at a time. So for example, they have a $3,000 2-bedroom apartment that's available July 2nd in Austin, and then you could spend a little bit more money and go to, uh, D.C., things like that. Super interesting.
Yeah, this is cool. So this is basically corporate housing because you're getting furnished turnkey apartments, but it's without the corporate. It's like They just put the power in the hand of the individual who may or may not be doing this as part of a corporate relocation. They might just— this might just be a lifestyle relocation like you're, you're doing right now. So you're going to use this?
Well, I, at the moment, because of corona, I don't want to be in an apartment. I only want to be in a home, a house.
Yeah.
Or an apartment with a private entrance. But like, you can rent a place in LA, a one-bedroom for $2,500 a month right now on this website, and it's all furnished. Very fascinating. Now there's a lot of holes in this model, but this is something that is very attractive to me and very interesting.
And Sonder is kind of similar, right?
Yeah, but they're not doing so hot because they were corporate travel, and there's rumors— I think they've laid off a ton of people. There's rumors that they're gonna go out of business.
Yeah, that's crazy.
And then there's another one called Guild, started by a friend of mine. Maybe the Guild or Guild. And they do the same thing, but it's also for corporate travel, whereas this is more so for nomadic-y type of people.
Right.
Very fascinating. What do you think about those?
Yeah, I like the idea. I think it's kind of one of those ideas that's either gonna seem obvious in retrospect or you never hear about it again. So I think that it makes sense that more people are gonna be doing this. The question is, is it enough? I like the membership model, right? Like, I think that's kind of a core difference from You know, okay, well, I'm, if I'm going to move, I'll just go and do my search, whatever. But like, once I'm in this network, then I'm just going to keep picking apartments in this network. But, and you know, I think you're trying to move like whatever, every month. Most people are probably not trying to do that.
I'm not going to do that for a long time.
Right. So I think, you know, the question is like, what is the length of stay? And are they pricing these above what it would be if I did a year-long lease and they're making more off it per month? Due to the flexibility. Okay, I could believe that. But then it's, you know, it's questionable if the economics are going to work, right? Because you're going to have vacancies where, you know, there's gaps of renting. And have you, you know, do the economics work based on how many people are trying to do this at all times? You know, it's one of those, it's one of those situations unlike Airbnb, where for Airbnb, they don't pay to lease all the places. So when demand goes down, sure, their revenue goes down, but their cost basis also goes down. Whereas for these guys, their costs are going to be fixed, essentially, because they're going to be locked into all these leases. So they can't withstand kind of the normal demand fluctuations that other Airbnb-type site could do.
Yeah, I'm interested. I agree with everything you've said. We'll see. What do you got?
Okay, let me tell you about some things that I found kind of interesting. So you wanted to talk a little bit about Levels, and we've mentioned it before. Um, tell me what's interesting about Levels. So Levels, for, for those who are either new or you don't remember, at one point in time me and Sam did this one-month weight loss challenge where we installed a continuous glucose monitor on our arm and it measured, you know, how is your glucose spiking based on what you eat. And the way this challenge was organized, uh, by this guy Justin Mares was if your glucose level stays below a certain level, meaning you're not eating sugary carb foods, Um, he will essentially return a deposit. We made a deposit of like $800 at the beginning of the month. Every day that we ate right, he would Venmo us money back. And it was a cool idea. It was a fun challenge. Wasn't super well run, but it was also— both of us walked away being like, yeah, well, this is the future. I'm gonna have a device implanted on my body that tells me how my body's doing in real time. Um, and so Levels is a company that's trying to productize that. So what did you find interesting here? Why'd you put Levels back on?
Yeah, this app is not in the App Store. It's a—
oh, TestFlight.
Yeah, it's in TestFlight, levelshealth.com. So the background here is, so people who have diabetes have either have to prick themselves every certain amount of time, hours or days, I don't know, and test their blood glucose glucose. And there are— there's a company, it's like the huge health company, I forget what it's called, probably Pritzker does it. I mean, whatever the huge conglomerates are, they have this machine called the Freestyle Libre.
Abbott.
Abbott, that's the one. It's a huge conglomerate, it's just a big thing. And it's this thing that you put into your arm and it tracks your blood glucose, like with a 30-second delay. And for 2 weeks, for 2 weeks. And if you have diabetes, people use this all the time. Now the problem is, is if you're just a nerd like me and you just want to test this and you don't have diabetes, you actually have to get a doctor's prescription. You can't buy this. I don't know why that's the case. I— maybe there's some great rule behind it. I'm not educated on it. But what Levels is trying to do is—
to clarify, I think you can buy it, you just aren't subsidized by insurance, so it's more expensive. Correct.
But maybe you can buy it from one of those like penis enlargement pills websites or like something like that. But I don't think that you can go on to Abbott.com and buy it or FreestyleLibre.com or Libre.com and buy it. I'm almost positive you can't. And I don't know why it's so hard, but it is. And so what Levels is doing is they're doing two things. One, they're giving you an app that you can make it easy to track your levels, your blood levels, and they're trying to eventually create the hardware for it. And I think this is just incredibly fascinating. I think these guys are raising money now and I think it might be something to bet on. I don't know yet though, but it's really cool.
It reminds me of, like, if you had just told me the idea, I would have been like, oh my God, I gotta invest in this. After doing it for 2 weeks, first of all, at the time, now maybe it was just early on, their app, kind of sucked. It wasn't like the, the normal— the out-of-the-box Freestyle Libre app was just better to use. First, you had to use it because that's how the scanner works. And so this was like, first scan it in this app and then open the Levels app to like see it in a prettier chart. Um, and I didn't find it prettier nor useful at all. Um, I think the dream for them is it's a great visualization, it gives you tips as you go, and you do your food tracking, your meal logging in it. But the meal logging was super clunky when we used it, so I never logged my meals in it because I was like, this is too cumbersome. Um, so I was unimpressed by the actual thing at the time, but I think this idea is amazing. I think that it's going to have really high retention for the people that opt into this lifestyle. And, um, and so I'm a believer in the, in the concept behind this business. I would build a business like this myself. I'm like that much of a believer in it. And it also reminds me, like, there's a company that just sold for $500 million yesterday, I think, called Mirror. Um, did you see this? Are you familiar with Mirror? So it's a very— it's this thing you put on your wall. It's an actual mirror that's sort of like a home gym that you plant on the wall. And there's two of these that are out there that I know of. Tonal is one and Mirror is the other. So Mirror got bought by Lululemon yesterday, $500 million. And, you know, on the surface is like one of those really hard businesses. It's like Hardware, new behavior for customers, really expensive. And so you could see all these different ways that it was gonna fail. And this, this female founder who did it and the VCs who backed it, it paid off and it got bought by Lululemon for a really great exit. And I think that something like Levels has the potential to be that if they can build the really awesome consumer, kind of like the health-conscious consumer, what they want that's more than a Fitbit. That's more than an Apple Watch. It's actually tracking their glucose levels. I think they could end up getting bought right back by a company like Abbott or by one of the sort of big, you know, either health or fitness companies that are out there. So I think it's a good bet as a business. I wasn't in love with the product.
I agree on everything you said. I think that what the problem it's solving is twofold for me. The first thing is nutritional information and calorie information on a lot of packaged food foods and normal foods. Do you realize how wildly inaccurate that is? Like, it could be like 20 or 30% off. Like, it's, it's pretty off. Like, if you go, um, I remember, uh, Casey Neistat did this thing where he took a Big Mac. He took like 5 different Big Macs and he's like, all right, it says on the package, um, that this is how much calories is in it. And then he actually, you know, a calorie is, uh, 1 calorie is the amount of energy it takes to heat up, I believe, a gram of water 1 Celsius., and temperature. And he, so they like did that test and like, oh wow, these are off by like 10 or 20%. And it was pretty interesting. I think that that's an interesting thing to look into. I also think that carbohydrates and protein and your different macros and nutrition nutrient information, it impacts people differently. Like, and I think that that's interesting to see what fits you best. Right.
And what, what triggers your responses versus not. Yeah. Yeah. And I think in general, anytime you can take something that has a really long feedback loop and give people an immediate feedback loop, that's a— that's the foundation of a great product. Like, that's— if that's the only thing your product did, you can win. And that's what this does. It gives you a really fast feedback loop on how what you eat affects your body. And I think that's both really important, and I think it'll be really compelling if it can get productized. Now, maybe these guys will do it, or maybe they'll make 30% of the way progress. But like, to me, this is inevitable. There will be a company like this. It will be uber successful. This will be very normal for people to have on their body at all times in some form factor, whether it's a patch on your arm or it's a, you know, a ring or a watch or something like that. But, and I think specifically the glucose monitoring, um, to me is more interesting than sleep tracking, step counting, you know, temperature, you know, all that other stuff that's potential, like, for you to track because it's related to eating. And if you can affect the way that people eat, you can change their whole life.
I mean, what do you got?
Here's one thing I found interesting. Alt data. So what is alt data? So there's this market that I didn't really know existed, but it made sense when I heard it, which is alternative data that people buy. So The alt data market is like $2 to $3 billion a year right now. And what this means is, let's say you're a trader, you're on Wall Street, or you're a hedge fund manager, you are constantly looking for an edge. You're looking for alpha, as they say. So how do you have an edge on the market so that you can get better returns than the average, right? Because you're charging fees to your customer to manage their money. So you have to beat the sort of passive indexing that they could just get by being in the market as a whole. Turns out there's a huge market for alt data and where people are buying one of the following. It could be satellite imagery. For example, you can look at crop yields in different countries and you can know how the commodity prices are going to be affected and how that affects Starbucks because they require these beans over here. You can look at mobility data. That's what's happening right now for people who are betting on the economy to recover. Google and Apple have these charts that show how much people are using Google Maps, which shows how much they're moving around right now, and that's a key indicator of like commerce activity. So a lot of the people who bet on— who are betting on the economy, they're trying to figure out, all right, are we about to go into shelter-in-place 2.0, or are people getting out and about, the economy's about to recover? It's really financially important to know that, so they're buying mobility data. They're buying other sources of data, which is like Robinhood, they're— one of their core business models is they sell the— I forgot what it's called, like flow data or whatever. Basically, they sell the transaction data of what people are trying to buy on Robinhood to these quant funds who will then front run the market in many ways. They'll see that, okay, a bunch of retail traders are going to buy Tesla. Cool, let's go buy Tesla faster than they can and we'll get the uplift of this retail traffic. That's coming in. So there's all these different alt data sources, and I just thought this is a really interesting business to do one of two things. Either A, you could build an alt data market where— a marketplace where basically people could put their source of data and buyers could come and browse the different satellite providers, the different mobility providers, like whatever, and you can sort of pitch what your thing does, and they could pay to get in contact with you to vet your stuff, and then there could be a reputation market around it. The other thing that I thought was interesting was just what other alt data sources could exist that you could bring to market and monetize in a way that's not being monetized yet. So I think some of this is new, right? Like cell phones unlocked a whole bunch of passive data sources— that passive data that didn't exist before— because now you have everybody with a GPS and a microphone and, and other tools on them. So I'm curious what other alt data sources might exist that could tip people off to make better financial decisions, or at least for Wall Street, because that's where the big bucks are.
That's pretty interesting. And so sometimes at The Hustle, people, like crazy people will email me and they're like, oh, you're selling my data. And I'm like, I'm not selling your data because I literally don't even know how to do that.
Like, I'm like, if I could, I would.
Well, like, I'm like, maybe like selling data, selling data inherently isn't wrong.
I mean, like someone on your email list, is that what you mean?
Well, they'll think they'll get like spam and they'll think that somehow I sold their email address, which not even a chance. I never did that. Um, which I know how to do that. I know how to sell an email list, but I don't know how to like sell insights or data. I mean, I don't even know who would buy it. I don't even know if it's valuable. I know nothing. Right. Um, but that's, that's cool. That's a cool idea.
You have a great, like a great one is Second Measure, which basically takes credit card data People know, okay, DoorDash is beating Uber Eats because they can look at the second measure data and they can see who's doing more credit card transactions out of those different companies. So VCs are using this. For example, I think one that would be awesome that's not public is cloud usage. So whose AWS bills are going up? And if you somehow knew whose web traffic is going up or whose bandwidth is going up or whose consumption is going up, on AWS, I think that would be a really interesting signal to use to invest in companies or sectors as a whole. So I'm just trying to think of what are some different alt data sources, and I don't have a ton, you know, but, but I think that this is interesting and the way these are used are different. Like, you told me your dad's in the like kind of produce farming market, sort of.
Yeah, and they do, and he's, um, he's got like a, a, a, a small-medium-sized business, and so they're not using significant data, but they definitely use the weather and they use some futures and things like that.
But yeah. And so I think that there's a lot that's in agriculture where people are selling, um, uh, whether specific weather data, like more specific than the sort of general weather data, and, um, and also just general yield data that's— that they have across, uh, the agriculture market for, uh, for, uh, individuals in, in that, in that space. And so I think that's kind of interesting too. So I'm curious, I, I know that in, for example, in sports. There's Synergy Sports, which measures all the court movement of basketball players, uh, on the court. Now this is a— I think it's available or it's bought by every single NBA team because no NBA team can just afford to like not have the data when the other 29 teams are doing it. And so these guys, literally just by installing cameras on the backboard in all 30 arenas, they now have something that's proprietary that they can sell for millions of dollars to NBA teams. Just to say, hey, here's, here's a data set that you can go and hopefully make better scouting decisions or game plan decisions based off of.
I'm looking at this now. This is crazy. Synergy Sports. Yeah, this is awesome. It's owned by a company called an Atrium Sports company. What is Atrium Sports?
I have no idea.
Fuck, that's amazing. I never ever would have thought— it looks like it might be a public company.
I never would have thought that this was And I love simple ideas like that where, you know, it's not rocket science. I think they get exclusive partnerships, and also the teams don't want multiple cameras having to be installed in their space or whatever. And so, and then they have like tremendous pricing power over the teams, uh, once they have the data. And so, and, and the richer their data set, like the longer they're installed, the worse the switching costs are if they ever want to use another provider, right? Because Okay, we can use this other provider, but then we lose the last 10 years of historical data that we might use to find patterns or make better decisions. And so I think a company like Synergy Sports is a simple company that's very well positioned in this market.
So Synergy Sports was either owned or co-owned by Mark Cuban, and he sold it, and the company sold it to Atrium Sports for $90 million.
Interesting. I think it's worth a lot more now because this is sort of a more recent trend. Okay, another thing to follow up on that's sort of sports related. So we had talked about Jack's idea of a baseball card sort of Fort Knox, and, you know, a place to store and trade baseball cards without ever having to move hands. And then a whole bunch of people reached out after the podcast, which is great, love it when they do that, to be like, hey, you ever heard of freeports? And I was like, well, no, I've never heard of that shit. What is it? And basically what freeports are Uh, this is my like very brief Googling afterwards, but I was like, oh, I should, I should mention this, I should close the loop on this. So a Freeport is, um, is an art storage warehouse. So they— so basically people do this for art. So it does two core things. You buy a piece of art, it gets stored in a Freeport, and, um, this hand— they handle like sort of the whole storage process so your art doesn't get damaged, doesn't get stolen. It's like, you know, state-of-the-art security, that sort of thing. But the main benefit, the reason people do this, is because art can't be— when you buy a painting for $80 million, which people do, uh, believe it or not, they— you have to pay sales tax. You have to buy— you have to pay tax on that, on that purchase. And so that could be, you know, $4 or $5 million. And so how do you avoid paying that tax? Well, you only owe tax once it's landed in your destination. So a free port is considered to be in transit from for an indefinite amount of time. So what they do is you buy a piece of art, it goes to the Freeport, it's in transit for 20, 30 years. So it's a way to preserve wealth across like decades and not have to pay the tax until you sort of want the tax to be due. And then you could actually just sell it to somebody else who will keep it in the Freeport. And then you sort of move on without ever having to like use the art as, like get the art out. And so I thought this was really interesting. I had never heard about this. I bet there's either software you could build around this or marketplaces for these or, uh, you know, some kind of, you know, um, sharing economy version of Freeports. Like, I don't know enough about it, but it definitely made my ears perk up. And if somebody out there wants to go do a bunch of research on Freeports, I would love for you to come in our Facebook group and post what you found because I think this is very interesting.
Okay, so I'm looking up, uh, this is awesome. Love, love this. So there's one called Geneva Freeport. The Economist has a bunch of really cool articles about it. The headlines are very clickable. It's like the largest art collection for the uber rich that you'll never see. And it's in Geneva, and I'm ignorant, Switzerland, right? Geneva, Switzerland. I think so. And this Freeport company, Freeport, Geneva Freeport, it had 250 employees and it had sales of 70 million. I don't know what that is. Is that a Swiss franc? I don't know what— I think that's what that is. Um, I believe he's saying yes. So that's 70 million francs. I don't know what, uh, what the conversion is.
Right.
Um, and it sold recently for a lot of money. Fascinating.
Yeah. So, so I think there's more to be— more, more needs to be looked into, into that. Okay, one last thing I wanted to bring up because we got 5 minutes left, unless you have one. If you have one, you should go.
No, I'm obsessed with Freeports now.
Freeport PAR. Um, all right, so the last thing is I had this conversation yesterday. I just wanted to share this.
I— it's gonna be kind of a tease, so sorry, but whatever. Um, but I still think there's some lessons to be learned. All right, so I was talking to somebody yesterday very credible person. They sold their last company for over $80 million, and they were talking about what's next. And, um, and they said something, you know, we were talking about how we're thinking about, you know, what the next chapter looks like. And he goes, yeah, you know, I find myself, I ask myself this question, which is, how do I build something in 2 weeks that's going to make me $5 million in the next 2 months? And literally the other people that were there just started laughing because they're like, what? Like, that's not a thing. And he's like, no, I think, I think it is a thing. And he's like, you know, I didn't know the answer, but like, I asked myself the question. I believe that it was possible. He's like, and so I can't— I got a bunch of ideas. And he started rattling off the ideas. The very first idea, I was like, holy fuck, this guy's actually gonna work. Like, I would, I would actually bet that, that the idea he said would work, which is crazy because like Even if that idea had a 10% chance of working, it would be totally worth doing. If it had a 1% chance, it'd be worth doing it. I think this idea has like a 50% chance of working. And after it happens, I will come back on here and I will be like, that was the idea that I was referencing. But so I can't talk about the idea. I can't say who it was, but I will say, I think there's something very powerful to asking yourself this question. You know, one of my like kind of Shaunisms is ask a better question, get a better answer. And so instead of saying, oh, what do I want to do with my life? What should my career be? What do I want to work on? Ask a better question. And so his better question was, what can I build in 2 weeks? Oh, and also it was with no code. So what can I build in 2 weeks with only using only no-code tools, um, that will make me $5 million in 2 months? And so he first started hunting down what are examples of things that are making $5 million, you know, across a 2-month time span. And he found a bunch of examples, and then he worked off of those to figure out what can he build that's Not that, but similar, has similar properties. Alex Tew, who's the guy who created Million Dollar Homepage, did the same thing. He was 18 years old and he asked himself a question, how do I make a million dollars? I think it was, I think he also said in a month, like how do I make them, how do I become a millionaire in a month? And the idea that came to him was Million Dollar Homepage and it actually worked. He actually pulled it off in the next like 2 months. So what do you think of this? And do you ever ask yourself questions like this? Or am I just crazy?
A little bit. I ask myself, I think of like what my long-term goals are and I'm like, how do I get this done? Just like this year, right?
I do that all the time. 10-year plan, how do I do it in one?
Yeah, I ask myself that all the time. But I think that most people are shocked that these silly questions can have true answers, right? And there's many examples of this happening. So for example, The Samwer brothers, they own Rocket Internet. They cloned eBay but in Germany and sold it back to eBay in 90 days for $50 million. And I think that if someone wanted to say, I'm going to abandon my family, I'm going to abandon my health, I'm going to abandon my friends, and I'm only going to do something for 6 months, I think they'd be shocked at what can happen. Now, they're going to pay the price. You got to pay a price for what you get. But I think it is great. That's a great question. And I'm going to tell my company that.
So we had done a version of this, like on the podcast once, which was if you had to make $1,000, like either today or like in the next 48 hours, how would you make $1,000? And you can't use any, like you only have like a, whatever, $100 budget. I think you were like, I would buy bottled waters. I would go to a place and I would sell, you know, every bottle of water that I'm buying for whatever, 20 cents for $3, and I would just go in front of a hot area, and I, I know I could make $1,000. I've done it before, right? That was like your answer to that.
Yeah, I, I, by the way, I made $5,000 this weekend, and I didn't make $5,000 because I, I sold all my gym equipment.
There you go.
And I sold a bunch of used clothing, um, but the, the gym equipment we sold, uh, because I bought a lot of it used and there's a huge demand, I got $300 or $400 replies on Craigslist from it. So I made 5, I profited a couple grand, grossed 5.
Yeah, and Gary Vee's always talking about this, like, okay, go, you know, go hunt free Craigslist and Facebook Marketplace and thrift shop or whatever, and then go list everything on eBay, and like, you can make, you know, $250 a day doing that. And like, go show me your hustle. And he like does this whole fucking—
that's just hard-ass work.
Yeah, it's hard-ass work.
I like the first question, why do you get $5 million in 30 days?
Yeah, exactly. You're probably gonna work the same Same level of difficulty, just with a bigger prize. So, okay, so let's, let's play the game. Um, let's say you need to generate, you need to make $1 million in the next month. What do you do? And you can't use any of your existing assets to do it.
So if I had to give you a budget of $10 grand, if I had to use an existing asset, I would for sure do a course on how to start a newsletter. Um, that would, I would bet my life that would do it.
You can use your, uh, brain, sure, but you can't use your like Hustle email list, for example.
I would have to— I would have to use that. Um, I don't know, man, that's a hard-ass question. Can you answer yours first because you already discussed this?
Uh, well, no, I just thought of it just now, but let's both brainstorm it on the spot. I think that's the sort of real way to do it. So, okay, so what are some things that I would do? Um, I think partially like this guy, I would look at things that are already generating that amount, um, and I would see, okay, is there a riff on this that I can use to to make that happen? So for example, is there, is there something in the, you know, oh, I like, for example, I know a guy who's making a lot of money in crypto right now, and what he's doing is sort of arbitraging between exchanges and liquidity pools to, to make money there. Okay, can that scale up to get to the million bucks? Okay, maybe, maybe not.
Maybe it's just that's really complicated.
Is there an app that I could use? Is there an app that I could build, right? Like you know, the weather app, an alarm clock app, like some stupid simple app that I could do, a meditation app that I, you know, a sleep sound app that I could build that could, that could generate that type of revenue in that short amount of time. Well, I think I'd probably have to pay too much for the marketing of it. So in my $10 grand budget, I can't do it. So the constraint really is the $10 grand budget. Okay. How do I do that?
I could— I think you have to make something that a business will buy from you. Like they would buy the asset.
So like as a customer, you mean not like acquire it because acquisition will take too long.
Well, yeah, but well, what is like an immediate need? So like, if someone's like, I need more customers, it's like, hey, I built this database. There's, I think there might be some customers here, but like, if you had to use no code, you'd have to like, I can't—
you don't have to use no code. You just $10,000.
That's— I would have to, cause I can't code. Right. Fuck, that's hard.
You can recruit someone, you can convince someone.
I mean, I guess you could do real estate and try to like finagle like a contract on something, but I don't know how to do that. So I wouldn't be—
I wouldn't—
Yeah.
So that's one way. So what you could do is you can find a— you could go hunt for a property that is sort of distressed in some way. You could get the right to buy it and not, you know, you get it under contract without putting your money down yet. And then you can simultaneously find a buyer for that property. That's because they're not marketing it the right way. And you could basically do the buy-sell on the same day without ever putting the money into the deal.
That's called wholesaling properties? Yeah, yeah, wholesaling real estate. You just flip the contract. It's flipping without doing any of the work. Yeah, exactly. So, you know, you could do something like that.. But that's not what I would do. What would I actually do? I would try to design something that goes viral, right? Because for $10,000, I'm not going to be able to get distribution through any paid means. So I need something that's going to spread virally and then net me some money at the end.
So it's got to be a digital good though.
It can't be—
you can't be selling like deodorant.
Yeah, exactly. So, so what could go viral that's going to be a digital thing? You know, maybe there's a variant of the Million Dollar Homepage type of idea that you could do. Maybe you could actually— maybe you could do a physical product. So maybe you You could do a physical product that you don't, you actually don't make yet. You just presell it. So, so that would still fit within the bounds, but you'd have, it'd have to be a viral product that would spread without you doing paid marketing. So you could do like a Kickstarter type of project and presell a million bucks and use the 10 grand just to make the video of the product that you're going to make. So I'd have to have, I'd have to come up with a product like that, dude.
Maybe this free porting thing would get that.
Okay, here's what I'm going to do. I'm going to come into the next episode and I'm going to have my answer to this question. I'm going to have a great answer. I'm going to have an answer that if I listen to it, I'd be like, fuck, I should go do that. Um, and so I'm going to make that my homework for this thing. I'm going to give myself the weekend basically to come up with my answer for it. And I think you should do it too.
And a brain would be such a fun experiment to do. I haven't—
then we should do it.
Well, yeah, I have admittedly an unfair advantage, like We did a course, and I don't know if I want to do courses ever again, but it was like wildly profitable and people loved it. But that for sure would work.
Yeah, but I think we have to do it without using the assets. I think that's the real, that's the real, uh, sort of creative test because otherwise it doesn't really apply to most people because they don't have the unfair advantage you have to begin with, which is like whatever millions of people who read your emails. So I think you need to to do it without it.
I get that, but if I were to do this, I would absolutely use that because I'm like, uh, this works.
Okay, I'll bring you with a good idea. Okay, so you create a campaign called 1 Million Masks, and you are going to give away masks for free to people who need it to prevent coronavirus. And you convince the brands to put their logo on it and pay for the masks. And let's say the mask is 50 cents, you charge a dollar for the mask, to the brand or $1.50, you pocket the dollar and you need to get a million masks paid for by brands in the meantime to do it. So you tap into something timely where brands are looking to put their stamp on something and be a part of them, contribute to the cause.
This is such an interesting thing.
All right, are you down to come back with your answer to this? And also, Abreyu, are you down?
That was my answer. That's a good one.
All right, but I'm giving you extra time. If that's the best answer you come up with, you just come back and say it again. But if you come up with a better answer by our next recording, then you got to put it— you got to say it on air. All right, got you.
All right, cool.
That's how this podcast can go viral, by the way. We just put our money where our mouth is. We say, hey, we did this brainstorm thing. And by the way, for the next month, every episode is just the progress of doing that thing and reaching the million.
This is so much work, but I'm down. I'm, I'm very interested.
There's a prize. You can make a million dollars this month. It's not work for nothing.
Are you— do you consider yourself lazy?
Yes, same, to the point of, uh, like it being a negative.
Same, I'm like, uh, so much work.
I, I remember I applied when I, when I moved to Silicon Valley. I was applied to the job at Monkey Inferno for the Idea Lab, and I had made like a resume, like a website resume. I basically went all in for them. I made a website, it was my resume, it was about them, tailored to them, and one of the sections was I made it like a video game where I was like, here's my attributes. Like if you go in Madden or whatever, it's like speed 99, this whatever, 92. And so I did it for all my business attributes and work ethic was my lowest attribute. It was like a 5 out of 10 or whatever it was, like, you know, 55 out of 100. And during the interview, the guy was like, this was, this whole website thing was great. Like, but why did you say your work ethic was bad? Like, I've never seen somebody come into an interview and say, I'm not that hard of a worker. Like, I was like, yeah, I'm honest.
Like, that—
I'm not. I'm just not. I was like, there's other people who are, but like, you know, that's not what I do. I don't try to work the hardest. Um, I do try to work the smartest, but I, I definitely— I actively try not to work the hardest.
Right. Yeah. They find the quickest path to the solution.
Well, let's wrap it up. Tweet at us. Let us know what you think.
Give me your answers. I'm coming back Monday with great answers. All right.
See ya. And let us know what you guys think about this first segment. I think that I'm inspired by this guy, to be honest. I love meeting people like that. That was inspiring to me.
Yeah. That was a good scheme. That one almost pulled it off for him.
Actually, yeah.
Cool. Uh, all right, I gotta run.