#92 - A Three Month Old Company Profiting $90,000 A Day

What's going on?

Not much, dude. Before the podcast, Abreu was telling us about a guy who is just uploading, you know, instead of competing on YouTube, he's just uploading his videos of him hanging out with his friends talking onto Pornhub. It's getting popular because it's—

wait, is he really?

It's not porn on Pornhub.

How big is it?

Maybe we should do that with the podcast to grow this thing. Um, just a bunch of guys talking about ideas on Pornhub. Uh, how popular are these videos getting?

I'm not sure how many views they have, but, uh, he gets a ton of free press from— I've seen so many articles. Like, every, every, every now and again I'll see articles on it. Yeah, just like the BuzzFeed article.

Um, okay, so what are you talking about?

I've got a few quick fun updates. That are just funny. Okay, so Heineken 0.0. I've been talking about how I drink a ton of these each day. Yeah, they just DM'd me trying to get that sponsorship.

So there we go, shout out to 0.0.

Yeah, second, have you seen— did you see this thing I'm testing out, Tempo?

Yeah, you posted a video of this on your Facebook or in the Facebook group, and it looks like a bootleg mirror. Yeah.

So these guys aren't a sponsor or anything, but they did give me a free thing to try out. It's like mirror, so it's— it looks like a TV, but it's self-standing, but it's got this like— what was that video game that had a camera that would tell where you are?

A Kinect or something?

Yeah, like Xbox or something. It has one of those on there, so it tells you if your form is shitty or not shitty, and it also has like 200 or something pounds of weights, and I'm testing it.

And then like, as a resistance band, or is it a dumbbell?

Like literally like plates of weights and it has a barbell and a dumbbell and you put it on and, and then there's a leaderboard and it can tell what type of weight you have on and how many reps you're doing and you compete. And anyway, it's freaking awesome, but there are a few bugs that I'm noticing.

No big deal. Is this like released or is this a private beta type of thing?

It's out. It's out. It's out now, but they are a new company and they, uh, it just makes you realize how hard that type of hardware is.

Why did you buy this versus like Tonal or Mirror or whatever?

I didn't buy it. They just— they saw that I liked this type of crap and they go, hey, you want this for a few weeks? You can try it. If you want to share, you can. If you don't, you don't have to. I go, yeah, I'll try it, right? I just like trying this stuff out. So Tonal is kind of like this except you have to install into your garage, like you have to like nail it to the wall, right? Um, and Mirror is no weights. This is just Peloton like Peloton with weights, you know what I mean?

Yeah. So do you like— now that you use it for a couple days, do you— are you like, this is the future, yes, I'm in?

No, but it's cool. It's kind of like, it's as revolutionary as Peloton, which is like, it's just got to get maybe a handful more people into that sport, right? No, it's not revolutionary, but it's quite fun.

But like, would you be disappointed, all right, it goes away, they take it back from you in a couple weeks? Yeah, I would have bought it.

Bummer.

You would You would have bought it.

I would have bought it. Yeah. It's pretty, pretty sick. And then I want to bring up one more thing that I'm learning about.

And wait, what was the name of that one again? Let's shout them out.

I think their URL, like you can't find them anywhere. It's called Tempo, but if you Google Tempo, you don't find it.

I think you said, I think it was tempo.fit.

Is it something like that? Tempo.fit. Right. It's cool. It's just nifty. The guy who started it is like 27, real young, 26, like a young guy. It's neat. And, uh, are you on the website? It's—

I'm on it right now.

It's like cool.

So I like the idea, and obviously Mirror got bought, and that's cool, and everyone's like, wow, that— what is this thing? I, I think this device is not like as good looking as those are. It looks more like an air conditioning unit than Mirror, which looks like a slick, you know, mirror on the wall.

But that's because Mirror, it's just bought— like, Mirror was like, the woman who started it was a ballerina, so it was all about like body movement. I mean, that's what she was.

She was a ballerina. I've like never met someone who's actually a ballerina.

Yeah, she was a ballerina. So it was all about mobility and body weight stuff. This is just a little bit different. It's— this stuff's fun though. I love it because when you go— the bad part about work at home is, or, uh, work— working out at home is the lack of competition.

Yeah, it doesn't feel as intense.

Yeah, this stuff's fun. And the second thing that I'm learning about— what did I watch? I watched, uh, You know, I like history, so I watched Alexander Hamilton, then I somehow Wikipedia'd my way to Ford. Let me tell you something about Ford. And this, I see this consistently of businesses of this era. So when Ford started Ford Motor Company, Henry Ford, when he started Ford Motor Company, they raised $28,000, okay? And that was in like 1903, I think. So $28,000 in 1903, inflation calculators are never entirely accurate because there's just, too much. It's too hard. Yeah, but like, we could probably say that— let's just say it was 10 to 20 times X, 10 to 20x, 10 to 20x bigger. So let's just say $700,000, or that's— or $100,000, or $1 million, whatever. It's a fucking car company. So they started the— they started Ford with $28,000 in 1903, okay? And And they used that, and by 2000, or sorry, 1905, 3 years later, they were giving out dividends to shareholders to the point of shareholders 3x-ing their investment. Is that crazy to you? Like, I read about this all the time, that A, these companies take so little money to start back then, and B, they're paying out dividends so quickly.

Yeah, it's surprising because there's obviously like a, you know, fixed, you know, capital cost there to do things. So I don't know how they did that, but I don't know, it seems like— all right, so there was this tweet over the weekend that's related where some VC, this guy Josh Felser, that's—

yeah, I know him.

He was like, he's Freestyle Capital, also a Duke alum. So he was like, oh yeah, you know, give me a great— I'll take a great entrepreneur over a great product any day. Or something like that. Just tweeted that out. And two funny things happened. One, this other founder replied and he was like, "You don't take founders. That's the problem with VCs. You have it all backwards. You're, you know, capital is a commodity. You get chosen. You don't choose founders." So this guy got like really upset and like, that's totally not what he was talking about. Like, I will take you. He was just saying like, I would— It's just pooch reading. Yeah, exactly. Exactly. He was not thinking that he was about to get sideswiped by this guy. And then he had to like apologize 'cause every VC has to like, you know, toe the line, it seems like with this type of stuff. So then the second thing was there's this old Marc Andreessen article called The Only Thing That Matters. And Marc Andreessen has this blog that's like offline, but there's a thing called the PMarkt Archive that still has his old blog posts. And the blog that says The Only Thing That Matters basically says, hey, there's this debate. What matters most? Team, product, or market. He's like, a lot of people, you know, think the best product wins, but once you get some experience, you realize that's not true. You know, you do need a good enough product, but that's not the most important thing. And a lot of people will say team because that sounds really great because you seem like somebody who's betting on people. It's a great way to get people to feel flattered and take your money as an investor. But, you know, there's that old Warren Buffett quote, when a great entrepreneur walks into a crappy business, the crappy business keeps its reputation.

Yeah, and he says, he goes, a great team is, it's a nice to have, right?

And he goes, I will propose that a great market is the most important thing for any startup. I'll take a great market over a great team and a great product any day of the week. And he explains why. So anyways, long way of saying how much of, you know, like when you talk about Ford back then, cars, like the whole automotive industry, I mean, what a hell of a market, right? That's still today one of the largest markets that's out there. Being early to that market, like, I think you can perform miracles. You can start a business on a small amount of money, be returning capital within a couple years, and, you know, grow a brand that endured 100+ years later because of how good that market was, how strong that market was.

I get that. Yeah, you're totally right. But even for, let's say, like the Bitcoin guys, like that in 2000, uh, what did all that craziness go on, '14?

Started like 2009, 2010, but then the hype happened 2012, '13, '14.

Yeah. So even if you started a Bitcoin thing around the hype train, I mean, that's like, I mean, you're going to take off. It doesn't matter how bad, if you have Bitcoin in it, you're taking off. But even then, like a lot of these businesses had to raise a lot of money. Right. And I'm like, and this is my favorite era in history, about 1900 to about 1930. Carnegie did the same thing where he built a bridge and was turning crazy amounts of dividends to investors in like 1 or 2 years. And dividends from startups isn't really something you hear about right now. It's more so— and so anyway, that's just like, I'm crazy fascinated on. So one, there is one major thing, which is income tax didn't happen until like the 1920s, I believe.

So, and also, I, you know, I don't study history like this at all, but My questions would be, I would love to just see the use of funds. So where does that $28,000 go into starting this? So, you know, what were the wages of people? Was there actually just a lot of debt that he was able to use? So he raised a little bit of money and then mostly there was a huge amount of loan financing back then that he was using to build this company. I'm not sure, but that's what I would need to know to kind of judge how the hell you could pull something like this off.

It's just fascinating. I just love, what I love reading about And this is the reason why.

How much money did you initially start the hustle with?

Nothing.

Zero. And then you raised— would you raise like a million bucks?

Yeah, and I didn't— I shouldn't have done that.

You raised a million bucks and, uh, you never needed that money. You never used that capital, correct? You like kind of always had a surplus basically of cash in the bank.

For sure, but I'm not building a freaking car.

Yeah, but like, you know, whatever. You're modern-day Henry Ford. That's what I'm trying to say.

No, noted. It's just fascinating. I think I love reading about these people who just do things differently, and I have no idea if they were different back then, but they are certainly different to my perspective. And I think that that's exciting to see someone who's doing something different than what your expectations are. You want to talk about ideas?

Yeah, I got a bunch. Okay, where do you want to start? So let me start with Also, with the company I saw that was kind of cool. Okay. So I saw this guy on Twitter.

Oh, before you get into that, did you get a ton of tweets? Thule.

Yeah, said it wrong.

Sorry guys. I've been talking about Thule for 2 episodes now. Thule.

And it's—

Thule. And it's— is it Thule? And it's not Switzerland or wait, it's Sweden, not Switzerland. Sorry. I'm reading while we're talking. So my apologies. Yeah.

Look, this podcast, the energy is great. The ideas are interesting and the facts may or may may not be correct. Like, that's what you need to know coming in. That's the disclaimer. If we were sitting here trying to do research on the pronunciation of these Swedish company names, like, you know, then I wouldn't have time to do anything else.

So it's—

thank you for the corrections though.

And it looks like it rhymes with mule. Thule, give me a break. That's their fault, that's not my fault.

Okay, so there's this guy, I'm going to say his name wrong too, Lloyd Arnburst. So I saw this guy's Twitter, and first of all, Twitter's the most fucking amazing thing in the world. Like, Twitter today still is just so awesome and you don't have to know anybody, you don't have to be anybody, and you can just like get the best education, best network, you know, on Twitter. So anyways, I saw this guy and his bio says tech founder, then there's the American flag, which I, you know, thought was great.

Where are you, Sean, on this?

I'm on this guy's Twitter. His Twitter is @LArmbrust. A-R-M-B-R-U-S-T.

I know Lloyd. I had dinner at his house.

Okay, great. So you can tell me about this guy. So here's what I saw. So I saw Y Combinator 2010, I saw 5 acquisitions, and then he says parentheses, 5 kids, but 5 kids too, but unrelated. And I was like, okay, this guy's, you know, already caught my attention. This guy's a legit player. I don't know what these 5 exits were. You probably know better than I do.

Uh, I, I, I, my good friend Noah and Neville, we had, uh, what's the dinner on Friday night for Jewish folks? Shabbat. We had Shabbat at Lloyd's house, and so I, I had an intimate dinner with him for 3 hours. That's how much I know him.

Intimate. Excellent.

Okay, so, you know, like a family, right? Yeah, a family dinner.

So what caught my eye was that he's working on something new. So if you go to Armbrust USA, um, he's doing US-made medical masks, which sounds like the most like simple obvious idea right now with coronavirus. But when you go to the site, you can tell that this guy's like gone all in on American-made, you know, medical equipment, starting with N95 masks. And I was looking at his interviews, I was watching his videos. And I definitely think that the pendulum is swinging back this way, which is that from a government level or a consumer level, I think Made in America is finally gonna matter.

I've been talking about this for months.

I completely agree. I'm gonna send you, I'm sending you an email right now and we're gonna bring up this file. I have the financials from a mask business that we can kinda go over.

That's cool.

So I've been buying Red Wing boots for a long time and I actually think that the little secret is that they're not made in America anymore. But they're like, their whole shtick is that they've been around since 1900, yada yada yada, and they're hardcore and American. I agree. I think that— I completely agree. And I actually surveyed my audience on Twitter and asked how many would— are going to pay extra for items that are made in America. A significant amount said they would. I completely agree. I mean, when I see— when I see made in the USA, I buy it over other stuff. Now there's definitely a threshold, but yeah.

My brother-in-law was telling me the same thing. He's like, yeah, I buy these jeans, I buy this type of gi for my jiu-jitsu stuff. And I was like, Well, you are actually paying the premium? Like, you know, these are not small premiums, like 50% more, 100% more in some cases. And he's like, yeah. And he was like, I don't know if it's the time. I don't know if he always did that. I don't think he always did that. I think the way the world is going, I think there's a strong nationalist movement around these sorts of things.

That's insane. And it also doesn't seem like this is big enterprise, like it's not selling to hospitals because the average order value is more like, you know, $50. It's not like it's, you know, $50,000 orders by, you know, small— sorry, like a handful of large hospitals or companies.

Yeah. And so what Sean and I are looking at is it says date, order number, units sold, shipping fees, average order value, cost of goods sold, gross margin, returns, and Facebook spend. So they're spending a lot of money on Facebook.

Yeah, but they're still profitable. Every single day is profitable in the tens of thousands of dollars. That's cool. This is awesome. Thanks for sharing that. And if you're listening to this, don't run out and start a mask business unless you know what the hell you're doing, because literally you're putting lives at risk if you're fucking up or if you're like, working with some random supplier who says it's N95, but it's not really N95, which is a big problem that's happening right now. Or you're like the third middleman in a four middleman chain, and you're just ending up marking up these things a lot. But I think if somebody's going into this with some authenticity, which it seems like this guy's doing with his American manufacturing facility and his plant that you can see the videos of.

Yeah. Okay. Yeah, cool. Anyways, I thought this was a good idea and I wanted to shout it out because I think it's a good thing. It's a good thing for a smart person to work on now.

So what I'm doing with the hustle lately is I've been emailing out surveys. So last week I asked how many people are going to move inside the next 6 months, and 33% of people told me they're moving within 6 months. And I think 7,000 or 8,000 people answered the survey. This week, what I was gonna ask was how many of you won't be able to pay your mortgage or rent in the next 2 or 3 months? I'm curious about that. But I could do Made in America about what are you partial towards, Made in America or made in your home country goods.

Or like, you know, in the last 30 days, have you knowingly chose an American-made product and spent more on it? You know, like, did they actually put their money where their mouth is versus like, yeah, I would consider it. I think everybody's like, yeah, I would prefer an eco-friendly product, and then do they choose it or not, you know, that's a different question.

So, well, let me see if I can ask something like that. Okay, those financials are freaking crazy that I sent you. I think that it's bullshit. I think that if, if you're gonna start a mask company just for like the revenue that you're gonna get out of it, I feel like you're gonna get crushed, um, or it's just not gonna exist in like 3 months.

Yeah, yeah, exactly. I would not do it as a— I would not be thinking of it as a durable business.

Yeah, and I would— I'm not a fan of it. What's software publishers, Sean? Software publishers.

All right, so this guy brought this up, again, stolen from Twitter, because that's where I get most of my ideas. I forgot who it is. I wish I had wrote it down so I could give him credit. But somebody said, you know, in many other industries, right, music industry, you have publishers, you know, book writing industry, you have publishers where you have a separation between the talent that creates the thing, the creative talent, and the, the body that's, that's meant to do the sort of distribution, sales, getting you into, getting you in front of customers. And so there are a whole bunch of industries where you have publishers, but weirdly in software there's very few software publishers. Usually when you start a software company, you're going to be responsible for the idea, for the creation of it, for the iteration of it, for the distribution of it, for the sales and marketing of it. And I thought, you know, that's actually kind of interesting. I was curious why, why, why you think that might be the case, that You know, that's not the case with music, it's not the case with books, it's not the case with a whole bunch of other, you know, fields where you have publishers. Why don't we have software publishers where a rando engineer can build an app, you know, pitch it to or get picked up by a publisher who says, hey, this is a good utility, you know, you're great at programming, but I'm great at distribution and marketing, I'm going to take it from here.

We should also say the gaming industry still works like this, where software for games, you know, whether it's a small little, you know, boredom killer game where that you play with your thumb or you're flicking noodles around a screen, you might get picked up by Catch App or by, you know, Lion Studios or whoever. And then also on a bigger level, great games can get bought by Riot or Blizzard Activision or whoever, and then okay, cool, now it's under that umbrella.

That's the— but games are kind of like their own thing a little bit. Like, the games are weird, games are their own beast. But like, if you're talking about like software tools, which I think you are, I have also wondered this because I'm like, this model did exist. And it is weird how, like, when you picked Slack at your company, it was probably only because some other company used it or a friend used it.

I saw Marc Andreessen tweet out the growth curve of Slack and I was like, huh, what the hell is that? And then I downloaded it and started using it.

Yeah, now some people, like a small insider, inside baseball community, might discover stuff on Product Hunt, but that's only the latest and greatest and the trending.

But it's just the latest, really, not necessarily the greatest.

Yeah, it's not the greatest, it's just the latest. Um, it has always baffled me why there isn't a more central place to discover all types of stuff that exists. And like your Amazon, like, people also bought XYZ Right.

One of these companies is called G2, and they were just in the news today because they laid off a ton of people and raised $100 million, even though they took $5 to $10 million from the PPP thing. Right.

Um, but they're not a publisher, right? There's a reviews platform, right?

Uh, there's a fine line. I think that you could argue that maybe they are, but correct, yeah, they are not— not in the way you're describing. No, they are not, but they are a central location to discover new stuff.

How many engineers at Twitch do you think make over 7 figures a year annually? Twitch has 3,000 employees, right?

No, it's just under 2,000. The product and engineering would be like, I don't know, let's call it 700 folks, give or take.

I have no idea. Well, of 2,000 employees at Twitch, how many think you think make over 7 figures annually?

10 to 15, something like that. That's what— that'd be my guess.

10. So that's 10 to 15. Are they all, are they all, um, exact—

those are like senior execs or, uh, like probably super senior engineers. Now the problem with, with that is that the stock price appreciated, so whatever their offer was, their offer might have been worth $400,000.. But Amazon stock has gone up so much that that $400,000 offer is now worth $1.2 million because the stock price has quadrupled in the last 5 years.

So $10,000 to $15,000. I mean, I think you're kind of explaining why, why this doesn't exist.

But that's one company and that's a small company. You know, at Google, there are, there are individuals who at Google who are making $50 million a year.

No way.

Who, like, it's public. There's, there's guys you can look up. I forgot the guy's name, but there was a guy who either left Google to go to Facebook or whatever. And in that transition, um, they basically said what this guy was making every year at Google. And this guy was literally making $50 million, $50 million a year. Now he's, uh, you know, the exception, not the rule. But I think that at Google there are easily, easily 250+ people who are making, uh, over $1 million a year. Easily that could be, could be 1,000 people.

Isn't that nuts? Isn't that nuts to create a widget that's so big that your non-owners are making $50 million or even $1 million a year? Like, I understand, I understand if a salesperson makes over $1 million a year, that's easy. That's a no-brainer. It's just, you're just, you just get a percentage of what you make the company. So yeah, the upside's unlimited, but The fact that just like a salary or like normal-ish non-sales employee can make over 7 figures is fucking mind-boggling to me.

Yeah. So, so I think, you know, you don't have to have huge quantities in the same way that there's, I think, 350 or 450 total NBA players, period. So I think in the same way, there are more people in the technology industry that earn $1 million plus than there are NBA players who earn $1 million plus. That'd be my guess. And so if NBA players can have, have, have agents, I, I am curious why top talent in the tech industry also doesn't have agents that work on their behalf. Yeah, see, look, so Aabria just found the article. Google paid a total of $105 million to Andy Rubin and this guy Amit Singhal. That's the guy I was thinking about.

Well, Andy Rubin, he got acquired.

That's different.

He built— he— yeah, they created Android.

But yeah, this guy Amit Singhal, they agreed to pay him $45 million but ended up paying just $15 million because he went to go to a competitor. Imagine getting guaranteed $45 million and then leaving to go to a competitor. That's amazing.

That's what, uh, it's crazy, Zappos guy did.

Well, he walked away from the money. I'm saying imagine what the other offer must have been that this guy switched teams.

It's crazy, man. It's crazy.

Like the top AI people, the top machine learning people, the top self-driving cars people, these guys are making millions of dollars a year.

God bless America. Let's talk about the CB Insights. So I did a call last week with the founder of CB Insights. You know what that is? Yeah. Okay. So listeners, CB Insights, they're most famous because they have a newsletter like The Hustle and the guy who owns the company or CEO, like writes it and he's kind of quirky and funny and irreverent. What they do is, so cbinsights.com, the guy, Sean, who, It's the CEO. He's like kind of— he's got a huge Twitter following because he's really funny. His Twitter handle says like, buy, buy a CB Insights subscription, I owe people money.

Do you know who he is?

Yeah.

Have you ever— I never heard that term before, and apparently—

Oh dude, go to a big company, you'll see CYA all over the place.

I've never heard of it. It means basically like if you're going to make a decision, you need to cover your ass so you're not the one to blame if that decision is a bad decision. And so an oversimplified example of this is let's say you're a huge company with 5,000 employees and you have to choose between this company and this company for, let's say, like your Salesforce thing. Like, you're trying to figure out, do we use HubSpot, Salesforce, this or that or this? Now, that's a little— that's oversimplification. Usually it's for like smaller vendors, and you've got to do research on them to figure out, like, are they going to go out of business in 10 years? Shit like that. And I have never heard that. I've never heard of someone needing to spend $50,000 to $100,000 a year to solve this problem. Have you?

It's just crazy that a business that can be worth maybe $1 billion or billions of dollars in Gartner's case exists on the, on bullshit politics inside of a company.

Well, okay, look, they do do good research. So that's cool. They are also often wrong because their forecasts are forecasts and people suck at forecasting things. And the things people want to know are usually the uncertain things, and you're going to be more wrong on those. So I'd say they do provide value. Like, it's not like you don't get anything from it, but you would never pay that amount for that, for that level of information. You pay that amount because it's a seal of approval. It's a, it's a, it's a source cited, uh, for your decision making.

Well, I got curious about that, so I'll give you another example. Have I told you about WGSN? No. Okay, so let me make sure I said it right. WGSN. Yeah, okay. It stands for— well, I don't know what it stands for actually. WGSN.com. It's owned by a public company in England, so you can go and learn all about it. What they do, and this is again an oversimplification, is they tell you which color is going to be popular in the next year. So if you're Starbucks— yeah, if you're Starbucks and you need to—

that's all they do, or no, that's just like one thing that they do?

It looks like they have like food and drink, beauty, fashion as their like kind of core things. Okay. This is incredible. I'm going to sign up for get a demo. I hate to get a demo, schedule a call. That works.

Unfortunately. Is this not crazy fascinating? Abreyu just sent me one called scentair.com, and they do the same thing, which they tell you which scents are going to be the most popular. Like, not even like perfume, but like, uh, what, what smell you want your cut— your restaurant to be, or your casino, or your office, or your hotel. Uh, that's fucking crazy. And it's just nuts. It's nuts. And I think it's awesome. And I actually understand this one.

But I want to know how these guys get customers. So is it that they— that's more interesting to me, right? Because, okay, I can see how this would be useful.

You just get a sales team, bro, and you just, you got it.

You, a lot of these, if it's outbound sales or is it putting out free reports, but then like kind of the full report, if you want the full report, you know, click this button, you know, is it content marketing or is it outbound sales or is it both?

So how do you count the economics of a sales team? So you're like, how much does each salesperson need to make for you for that to be viable?

Yeah, so you traditionally give a relatively low base. So it could be $50 grand, it could be $100 grand, it could be $150 grand, and then you say you get 2% to 5% usually of all the sales that you bring in. And so you're on—

sorry, how much do you think a salesperson needs to generate? And what does one individual salesperson need to generate for you? What's your target?

At least $1 million, but tip tip— so in media sales, it's around $1 to $3 million. In software sales, it's probably around $500,000 to $1.5 $1.5 million. Software—

so you need a salesperson to bring in $1 million a year of revenue?

Yeah, and I'm doing some rounding here, but yeah, that's not $100,000, it's more like $1 million is what you're saying? Yeah, and that's very doable. And a software company that has recurring revenue, you could get— if you had a salesperson that cost you $150 grand a year and they were bringing in 500 grand a year, that's pretty good because hopefully a lot of those folks are going to renew.

LTV is there. Yeah. Okay. Yeah. I've never built sales teams. It's always something I've gladly not had to do.

Yeah.

A lot of— In the right circumstance, it's obviously it's great. You know, if that's the, if that's the model, if that's the growth engine, then you need to become a fucking master of building sales teams or hiring people who have built sales teams before.

But that's what, what you just said is how most of the smart nerds who build the great stuff think. They go, ugh, I don't want a sales team. And I'm like, you do.

It's the same thing as I don't want to learn taxes and how to optimize that. It's the same thing of like, oh God, I got to incorporate and figure out if I should be a C-Corp or an LLC and I got to set up my blah, blah, blah. It's like the perceived schlep of doing it makes me just not want to do it at all. It makes me want to be ignorant to it and makes me want to avoid it. Until I'm like, oh, the money is on the other side of that wall. Okay, now I need to learn how to climb this wall. And then when I climb, I'm like, oh, that's not so bad actually. I kind of like that wall. That's a pretty useful little thing to get over here and get this pile of money. And so that's how I feel about taxes now. That's how I feel about— that's how you feel about sales teams.

Yeah, and I feel that way about taxes too. There's this company that I hung out with in Austin, and I won't name their name, but they have software, and they have like a software company, and they had like 200 employees, and like 150 of them were salespeople. And they grew it just like crazy. And in my head I'm like, as someone who is a little bit more nerdy than I am salesy, I'm like, ugh, you are selling vaporware. But they got results.

So let me, okay, I'm gonna give you two ideas that could use salespeople, and I want you to tell me what you think. All right, so I'm gonna start with the one I'm more excited about. Maybe I won't even get to the second one. Let me see if I can articulate why I'm excited about this. Okay, at the last two companies I've done, I created— so we use Slack as the primary way the community, the company communicates. And Slack's great. Slack did a great thing, which was it got us out of email and it got us out of direct messaging where I just like, oh, I'm gonna bug Sam about this, or create a giant group for like everybody who's working on the marketing campaign or whatever, right? And Slack created channels. Channels are sweet because it's like You make a channel for the marketing, for marketing. That's where I go talk about the marketing campaign and whoever is interested. Like, a lot of people can see it, but nobody feels obligated to reply. So it's a really helpful way for information to spread inside a company. But what I found was that there was a whole bunch of things that I just wanted to share that, like, I didn't, didn't need to go into any specific channel. And it wasn't like I wasn't trying to create work by sharing it. I just wanted to share a thought on my mind. So I created this Slack channel in my Slack called Sean's Inner Thoughts, and I branded it like that because I thought people would be curious what my inner thoughts are. And so, and then a whole bunch of employees joined that channel, and really all it was is just a place for me to dump random thoughts that I have about stuff— something I saw was cool, something I thought we were doing, something I'm noticing, blah blah blah. And, um, and that was always well received. And now after we got acquired, my coworker Jason did that at Twitch. He created Jason's Inner Thoughts, and there's like 80 people subscribed to this thing and it's kind of like just like a private Twitter. Um, he just posts random stuff and sometimes people react to it, but nobody feels obligated to respond. And, um, because that's like the— that's the norm of that channel. And so I've been thinking about this, like, why isn't there a place to share stuff that is like the stuff that didn't need to be shared necessarily, the non-essential communication of a company that, that does actually bring out interesting conversations it helps people bond because they see what you're all about, what you're into. So the, the way I'll phrase this is Twitter for companies, which is not a new idea. So basically this is what Yammer was like, I don't know, when Yammer started like a decade ago. So Yammer was started during like the social media hype phase. It was like, oh shit, we have social networks for our friends and our family, we need a social network for our company. And they basically just copied the UI of Twitter/Facebook, and they were like, cool, it's Twitter/Facebook, but the only people that will see this are all your coworkers. And so, you know, you close a sales deal, you could post it there and a whole bunch of people could react to it or get excited about it. Um, or you could post a funny video from the, the, you know, the office kitchen and post it there and it'd be relevant to all those people in that group. So it's kind of like the non-work chatter.

And they shut it down though. Like it doesn't—

Let me pitch this a little differently. Do it. Have I told you about what Washington Post is toying with?

You told me that they kind of have like a software arm where they're like making other tools.

We talked about like the high school newsletter or high school newspaper for the company.

Yes. Yeah. Like that's what I would do. It's like a weekly, like, it's just a, it's like a, here's what's going on in the company. Here's what people are thinking. Here's some ideas. Like, that's what I would build is I would build a, and I, I think at Airbnb they built their own for this. At our company, I tried building our own and it was just Google, like a Google website. I forget what their thing's called. But it's solving a similar problem as to what you're describing, which is—

I love this idea.

I love that.

I love your idea actually even maybe more than my idea.

Like you could have podcasts, you could just like a, you just have like airbnbinternal.com and you just, you either, you have your login and it's just a Like we've aggregated all the happenings of the, of the business going on and you can log in.

What's interesting here, is it what's happening as in like kind of company announcements, news, the metrics? That's maybe a part of it. Is it part of it? Is it like a high school newspaper where somebody could just write an op-ed? You can just write an article, um, if you're interested and like you basically contribute a column basically for the day?

I think, I think, I think that is yes. And, but I would make it so where the thing about, you said like a private Twitter, is that like some of these, like the, when people think of like media or an article, they're like, oh, that's a lot of work. Then when I think of Twitter, they're like, oh, I'm just going to do this in 5 minutes. But the thing is, is that often those little 5-minute tweets add as much value or more than a long article. Absolutely. So you'd have to build it in such a way that like you can solicit this information from your employees. And in a low-pressure way because someone like, I have this woman, Becca, who runs our email business. I'm like, you don't write this report. Just, is this a good idea or not? Yes or no? Why? Just like riff. Like you already, I already know, you know, off the top of your head, right? Cause you're in the thick of it. Something like that. But where you have to make it like a little bit more knee-jerk reaction.

Yeah. You like the lightweight, low-pressure Twitter, not, or not blogs basically.

Yeah, I mean, those are— both are important, but a lot of people undervalue those little just like gut instinct things like you've described. Like, they're just like— yeah, but anyway, I agree with you. I do think that there's room for, uh, there's room for that.

Yeah, I like this a lot. I'm excited about it. Maybe, maybe I'll do this.

We've talked about this, um, with, uh, there's a bunch of There's a bunch of movement going around. Axios, the media company Axios, I actually somehow got my hands on a demo. They're launching a product where they're doing internal newsletters.

Oh yeah, yeah, in the concise format that they use for their company, right?

Yeah, it's not there yet. Like, it's because right now the way that it's built out is it's like Mailchimp. I'm like, I could just use Mailchimp, but you're just allowing me to send emails to an internal email list. So they have to add more stuff to make it interesting. But I understand the problem you're trying to solve for, and I agree with you. I think it's quite interesting.

Yeah, I actually like the Axios thing, even if it is just a mail list, because people today just use Google lists, and Google lists are fucking awful. They're awful to find. Google Groups is like miserable. That whole process, the whole listserv is awful. Then people reply all, and it's miserable. That whole thing is terrible. If somebody just said, I'm going to make Google lists and listservs for companies less shit, I'd be like, oh wait, that's, that's so smart. Why are you so smart? That's what I would say to them.

And there's two interesting things about this. If you get it done well, you can charge a lot of money, but the switching costs once you start seem to be quite high. And so you'd probably have a pretty good, like, low churn number and a high net retention rate for revenue. Like, you could probably add a lot more people. The more, people your company hires, the more people who need access to it.

Yeah, this thing could make money. And, um, okay, I like that a lot. All right, so two other quick ones. So, um, so one thing I saw that was pretty clever, um, that I think is a great example of a niche product that somebody's doing to build like a lifestyle business. I was on Reddit and I saw an ad that said, get notified when your company is mentioned on Reddit. Have you seen this?

I've seen things like it, but not that bad.

So there's products like this that are out there, like monitor Twitter, monitor, you know, the newspapers, the media, you know, Forbes and shit, to see when your company gets mentioned. But this is a bigger— this is a bigger— sorry, is a more niche version of that, which is Reddit. Reddit's its own little beast. You kind of have to scrape it in its own way to be able to track things properly. What's it called? I don't remember. I saw an ad for it. I was like, this is smart, and I moved on, like, because I don't need that right now. But I was like, if most companies, like for you guys, I bet The Hustle would want to know every time you get linked to or referenced.

Yeah, or on Digg or anything like that.

And so, yeah, so I think that that's a really smart, simple idea that somebody could do. They're using Reddit ads to distribute it. All they had to do was really focus on being able to track keywords on Reddit and then market to a bunch of companies who are like, yeah, actually I do want to know when there's a conversation about my brand going on on Reddit. I do want—

I think interface— I think a brave— you just find it. Is it trackreddit.com?

I just use like a no-code version of, uh, building software, like a platform. What's it called? Uh, Bubble. Oh my gosh. Have you seen Bubble? Yeah. Is that— okay, so can you give listeners background here?

Yeah. So Bubble is one of the no-code platforms. Uh, that's pretty popular. And I think bubble.is is the, uh, bubble.io is the, is the handle for it.

I found it Friday and I was like, this is—

and it's one of those. So when we say no-code, no-code can mean a lot of things, but Bubble is, is one of those. It lets you build apps, not just websites. So there's a lot of website builders, Squarespace, Wix, whatever. Uh, what Bubble does is it lets you actually have a backend. So like, for example, this weekend I built myself an app in no-code in 1 hour as a challenge to myself. I wanted to have a meal tracking app, like a food journal. And so I was like, oh, I want an app that just, I take a photo of what I eat and it shows it on a grid. At the end of the day, I can see everything that I've eaten for the day. And so I built myself a little thing. I was going to use Bubble. I ended up using this other thing called Adalo, and I actually built it. Like, you can have it. If you, if you download this app, you can see what I eat every day. Uh, but I was like, this is amazing that I was able to do this thing where I'm like, I have a UI, it takes photo, you can use the phone camera, it saves it in a database. I don't know what the hell a database even is, but okay. You know, it's saved somewhere., and I can display it in an Instagram-like feed. And I was able to build that in an hour and I'm below average intelligence. So I'm like, this is amazing shit now.

So, and you did that on that, with that, that site?

Yeah. I did it on something called Adalo cause they let you actually make a mobile app. So like I have an actual app now, so you can see these, this is my food grid. Wow. And if I wanted to add something, I could just add like another one.

So what's this, what's the thing called that I mentioned? Bubble. Man, I went to it. It was so cool. I'm like, I don't know if they're promising too much and they can't deliver on it, but it's so complicated. But it was certainly—

it's definitely complicated. I used the other one because I thought it was simpler, but I think Bubble can do way more. So like, there's people who are just gonna specialize in Bubble. They're called no-coders, and they just learn these no-code tools, and they overcome the learning curve on these things, and they're not really traditional programmers, but they know how to use Bubble and all these other little random no-code tools.

Really well. Yeah, I thought it was awesome. That thing, that was really cool to me. What else you got?

Did I talk about this kids Etsy thing before?

No.

I am so wonderful. I'm so not in the know of this market. Like someone told me about Kids Uber, like when it launched, I was like, that's—

For like, carpooling, like to school, you mean?

Yeah, or like an Uber driver that you can put your children in. Yeah, and I was like, that's the stupidest shit ever. That's a big thing now. So would people love that? I don't know. That's wild to me. The kids market is just so foreign. It'd be like launching a company in China. Like, I just don't know anything about it. Because I see these like toy review sites and they just crush. I see—

this is how I feel when you tell me about like Henry Ford in 1903. I'm like, dude, I don't know, man. I have no— I just don't have the— I don't have the insights on this. Like, I just don't know. And it sounds like you're not around kids a whole lot, so you probably also don't.

Not at all. And I don't understand— like, I understand the idea of like you'll do anything for your children. Okay, get it. Like, that's the only thing that matters. I feel a little bit of that with my some of my nephews, and it's like, okay, I'll give them anything to make them happy, right? I get it, love that perspective. Um, but like, like, do kids want to buy other children's books?

Yeah, I don't know if they— that's the part I don't know. Like, do they actually want like other kids' junk, or they only like their own junk? Because it's all junk. But, um, the reason I thought this might be interesting is because they do this at school. So like, you've— you remember like science fair where it's like everybody makes kind of a crappy thing And then you get to stand by your little volcano and everyone walks by and you get this good feedback of like, oh cool, you know, whatever. And somebody wins a prize. So my, my niece's school did like an in-person version of this where people would make stuff and then they could come, they, it was like a school fair and all the vendors were just other kids. So you brought all the stuff you made and you're at the kids' fair and you could go walk around and see what the other kids made. And some people are actually pretty good at it and some people are really bad at it. And you could kind of barter or exchange or like buy, you know, each other's stuff. And the parents are happy to pay a little bit just to give each other the good feeling. It's like Burning Man. It's like, I'll bring a little bit of money and then like, we'll all have the good— you— every kid gets the good feeling of getting to buy and sell an item. And so I was like, oh, that'd be cool to just do online at scale, basically. And I bet some kids are actually amazing at building stuff and they would be kind of the star Etsy shops that would like actually be making cool bracelets and stuff that other kids want.. But I think for the most part, it's about the good feeling of having your kid make something, post it, get good feedback from other people where they want your thing or they buy your thing, and having that feedback loop. And I think parents would just pay a subscription, and then the actual buying and selling is all funny money. That's just Chuck E. Cheese tokens. But I think you could get, you know, thousands of parents to pay $15 a month to have their kid be on this platform.

That's, that's wild. I, uh, let's get someone to make it.

Yeah, it's cool.

Let me bring up one more thing. Yeah. I heard about this. This is all rumors, but I did some digging. I can't find any verification. There's this guy I'm friends with on Facebook. He owns this company called Golden Hippo. Have you heard of Golden Hippo?

No, drunk hippo, not Golden Hippo.

The companies that Golden Hippo supports?

They own those companies. They own—

I believe these are their companies.

I believe they own about 12 of them.

Did you say $1 billion a year in sales?

I did.

And your friend owns this thing?

He's— I'm Facebook friends with him. I don't chat with him on a regular basis. —But, and then I did—

What's an example? I want to see one of their brands. They like don't list their brands on their website. What's a brand?

Yeah, and when I heard— when I— it said they have 800 employees and they don't list their brands on their website, I was like, oh, this is awesome, right? So Google Dr. Marti. That is one of them. Okay, Dr. Marti. And I think they're— I don't mean to like disparage them. I think they are legit, a legit company, um, or they are, they are a legit company. I, I just don't know any of their brands. Interesting. I have another one called, uh, there's this one doctor, it's like a white guy doctor with, uh, fucking— I'll look him up.

Dr. Seuss?

I don't know who this guy is. Yeah, uh, Steve Gundry, G-U-N-D-R-Y. So Google Stephen Gundry, um, Dr. Gundry's books and podcasts, and he sells books on a family cookbook for Crock-Pot. He sells, it's just all types of crap. It's just freaking crazy. These guys, like, it's just so funny to hear about these people that aren't in the mainstream, are kind of behind the scenes.

So here's what's interesting. All right, so I go to Dr. Marty, right? He's got an ad, he's running an ad around this article that's called "Three Dog Behaviors Caused by a Poor Diet.". Now the ad is actually going to a different website called caninecodes.com, not his sales website. So Dr. Marty writes this article, Marty Goldstein, DMV, I don't know, DVM, I don't know what that means, doctor, veterinary medicine maybe. What does your dog's behavior actually mean? And he's talking about this stuff and then how does this link to their dog food?

I'm sure somewhere here there's a— You probably give them your email, but like, all right, if you go to gundrymd.com, you'll see his website and he sells something called Vital Reds, which is concentrated polyphenol blend. I have no idea what that is. I'm looking at their website on Sim— and it's $70 for one jar. I'm looking at their website. According to SimilarWeb, they get north of 2 million visitors a month. If you get north of 2 million visitors a month to a store that sells a $60 product, you're, you're probably most likely crushing it, right?

So this guy seems legit. So Dr. Steven Gundry is a renowned heart surgeon and New York Times bestselling author of The Plant Paradox and The Plant Paradox Cookbook. Okay, so he's not like— I thought for a second they're just making up fictional, like, Aunt Jemima or, like, you know, Colonel Sanders. I didn't know if they were, like, trying to create, like, characters or if these are actual, like, actual doctors.

No, I think they're like Dr. Oz type but I don't know for— but this guy Gundry MD, he sells supplement, skin and hair care, food, dog food, books, and magazines. And they're not— their websites aren't slick. Yeah, not at all. And Tony Robbins is an endorser, he endorses them. It's just crazy. Like I said with Henry Ford, I love seeing things that break my frame.

Yeah, that's a great way of putting this. It's like my brain is like, I'm struggling to even talk. Cause I'm just like, my brain's like breaking and trying to refigure out, okay, what is this new, new, uh, new information that I need to process and figure out what the hell this is for. And, uh, you know, why am I not doing this?

But I can tell you, like, people have emailed me and I, I'm almost 100% positive they're pushing $1 billion a year in sales. They have 800 employees. This is all on Glassdoor. And I looked them up on Reddit and it says Golden Hippo Media is constantly hiring copywriters and constantly hiring media buyers. And I've seen this Dr. Gundry all over the place on these Outbrains. So I know what they do.

It would be interesting. We should like find out who are the top advertisers on Outbrain. 'Cause I think Outbrain is something, if you don't know about it, you're like, what the fuck's Outbrain? If you know about it, you're like, oh, fucking Outbrain, and you just disregard it. But look, there's a reason Taboola and Outbrain, there's a reason they make all this money, there's a reason people are spending money on these ads, 'cause they're working. So who are these advertisers? Who are their top 10 advertisers is what I would wanna know. And I bet I would have my brain broken 5 more times in that list.

So I just did a quick Google. EditorsChoice.com is the largest advertiser on Outbrain, followed by Edmunds.com, which is cars, cars, followed by Healthgrades.com.

Have you been to EditorsChoice.com?

What is this? I have no idea.

It's like bootleg WordPress site with like random articles.

It gets 10 million unique visitors a month. I must have typed something wrong. This is— no, no, you're right. I went there too. It's crazy, man. It's crazy.

Okay, no, no, now I went to the right site. I don't know where I was before.

I was on a healthierpatriot.com, uh, buys 1% of Outbrain ads. Dude, I'm telling you, there's a lot going on in the world that like we just don't even think about.

I can't even, I can't even get to the website of Healthier Patriot. I don't know what—

if you Google it, the first thing comes up with this is a scam.

Yeah, yeah, exactly. I can't find the actual website. Oh, I saw it was a scam alert. Uh, okay, weird. Well, I need to spend more time on this.

It's crazy. Like, there's a lot of stuff going on, dude.

This is turning into a true crime serial type of podcast where we get to the bottom of these businesses. Um, Maggie Q.

Have you heard of Maggie Q? No. That, I think that's another one they have. So wait, Maggie, it's an actress, activatedyou.com. And like the personality type is this woman named Maggie Q and they sell probiotics. And this website is one of, I think, Golden Hippo's website. So much so that when they sell so much stuff that I Googled them, they opened up a massive, I think 20 or 30,000 or 40,000, something huge, square foot warehouse in Memphis.

But where are you seeing— okay, so they're hiring a bunch of copywriters. What are you seeing that they need all these copywriters for? So I see some blog posts, sure, because the way that they're not like doing sales pages, like you just don't— it's always— I'm not finding them.

You always go to the side door. Those sales pages are for where you send paid media to the side doors, and those side doors that work best are long-form copywriting. So If you go to Outbrain, go to Breitbart.com with your ad blocker off and scroll to the bottom and you will 100% see an ad bought by Agora, which does long-form sales pages to get you to buy a $5 book or give you their email.

Oh my God, Sam. Now I got a whole bunch of stuff I got to do today just to get my head around this. Okay, sweet. You've given me my homework. Crazy, right?

It's freaking crazy. We'll come back to it on, uh, well, uh, we have Andrew Wilkinson coming on Thursday, so maybe, maybe we can bring this up to him and get his opinion. I— it's weird, man. It's weird. I just love having my frame broken, and this will break anyone's— most anyone's frame.

Yeah, for sure. Okay, cool. I'm excited for the rest of the week. We got Andrew Wilkinson. We also have, uh, the CEO of Barstool coming on, so that's gonna be exciting.

Yeah, we're recording that on Wednesday, right?

Yeah, that'll come out I think next week.

All right, well, uh, we good?

Yeah, we're good. Let's go. Oh, hold on, hold on, hold on. So Abreu just linked this tweet thread that we gotta read. So, 10 things we've learned at Golden Hippo after spending over $1 billion, parentheses, of our own money on online media. That's Craig.

I've talked to Craig. Yeah, he seems like a nice guy. I've hung out with him at a conference. He's He— I don't know if he still owns it, but he owned it.

Okay, so this is interesting. He says the idea that you might— they must see your ad 7 times before they buy is the biggest line of BS in advertising history. No matter how long you've been doing this, what you think will work is often wrong. Great, great ad ideas come from anyone. Influencer marketing is for companies that like burning money. Your customer cares literally zero about your company, your story, your brand, or even your product. What they do care is what it can do for for them. Don't fight this, embrace this. Okay, so this guy Craig, is he a cool guy or what? Let's have him on.

Yeah, I'll message him right now. I'm texting him right now. All right, so on the podcast we've talked about this million-dollar idea thing. Ha, what did we say, Sean?

Yeah, thought exercise. Something you could build in 2 weeks that can drive over $3 million of revenue within, I don't know, 3 months, let's call it. And you can't spend like $3 million to get it, right? So you can't like spend on ads like that much. So the budget restraint was, so it's 2 weeks to build, $3 million is your goal within 3 months, let's say, and a $10,000 initial investment. That was the, that was the thought exercise. And we are going to bring our ideas to the table for that. I have a couple thoughts on this, but I want to hear what you think, what you've been thinking for, not, not ideas yet, but just about this thought experiment.

Sounds like a ton of work. I'll do it for fun. So maybe in the next couple weeks we'll actually address this and do this. If you want to participate in this, tweet at Sean or I and let us know. If this gets like a ton of interest, we'll actually follow through with this.

Yeah, it turned out to be harder than I thought to think about this stuff, and I'm a professional thinker about stuff for a living. So I was like, okay, I actually need to sit down and do this. I can't do it off the top of my head. And I wanted to come to the table with something interesting that's actually relevant and not like, you know, a total knee-jerk, half-baked answer. But I'm actually gonna break it down into 3 groups. The first one is the exact thing that we just said, 2 weeks to build $3 million in 3 months of revenue and $10,000 initial investment. The other part of that first one is you can't use your personal assets. So I can't say like, oh, I just invest in this company, or I would— you can't use the hustle to like, you know, do some crazy shit. It's like just you as an individual person without using your other resources. So the second thought experiment is, if I had to make $1 million in the next 2 months using my existing resources, how would I do it? Which is less relatable to a listener, but more related, more relevant to us. Cause we like, why would we take the hard path? We would actually take the easier path, which would be to use our actual assets. So that would be the next thing that, that's the second thought experiment. And then the third one that I'm thinking about is the same, like sort of overall criteria, but with a larger budget for the initial spend. So if I knew I was gonna make $3 million, I would actually be willing to put up to, let's say, half a million or a million dollars as my marketing budget behind something. And so that's the third one. Now I'm gonna come to the table with answers for all three of those buckets, but I need time to think about it.

Same in all categories. And if you guys are truly into this, me and Sean are men of the people. So if we got to see what your, your response is, right? Right on. Okay, cool.

We've addressed the elephant in the room. Awesome. Okay, cool. I'm going to go swim, but this is fun. All right. Tough life. Bye-bye.