Best of This Week: Feb 14th
Hello, welcome to another episode of My First Million, best of the week edition. This is Ben Wilson, also known as Producer Ben, and this episode is some of the best clips from our episodes throughout this last week. Nothing new, just a short rapid-fire recap of everything that went on. To start off with, we've got a clip about the billion-dollar Bitcoin thieves. So Sean had written about this on Milk Road, his newsletter, which you should go subscribe to. It's really good. And he had the full backstory about these people who had stolen billions of dollars worth of Bitcoin. And then strangely, Sam had actually met one of them. It was a husband and wife team, and Sam had run into one of them at a party back in the day. And many of you pointed out that it seems like a strange coincidence that Sam also met Ross Ulbricht, another billion-dollar criminal. And so is Sam actually a criminal mastermind? Is he a real-life Danny Ocean? I don't know. But enjoy this clip where Sam and Shaun break down the story of the billion-dollar Bitcoin thieves.
I don't even entirely understand what happened, but I have a backstory about the people.
If you read today's edition of the Milk Road, you will get the full backstory in 10 bullet points. So here's what happened. 2016, this crypto exchange called Bitfinex got hacked.. And at the time, I think like 120,000 Bitcoin got stolen. That was like $70 million got stolen. And it was like, it was bad. Uh, that was like a big hack. The price of Bitcoin that week dropped by 40%. So it was like a, it caused like this huge, uh, you know, like, uh, uh, uh, a fear shock in the market. But the thing about Bitcoin is Bitcoin is on a public ledger, right? Like it's a, it's a public blockchain. So everybody could see the coins. So everybody saw, oh, the the coins are in this wallet. And like, and so all the other exchanges were like, look, this is bad for the industry. We will try to prevent— like, if that wallet tries to cash this out, we won't let them cash out the money. So for many years, that money kind of just sat in those wallets or was moving in like really small, small transactions back and forth between like a web of wallets. Clearly somebody was trying to like launder the money.
Essentially, they were trying But, but how, how did he, how did they even get it in the first place?
So they're, I don't know. I don't know what the exploit was that let them hack the accounts and they didn't hack all the accounts on Bitfinex. They actually just hacked like some of the whale accounts. So they were able to take 120,000 Bitcoin from not all the accounts. And the funny thing is Bitfinex didn't have the money to like make those users whole. So what they did was they, they reduced everybody on Bitfinex's balance by 33% or something to like balance it out. Something like hor— like imagine if your bank did that, that would be like insane. I'd be like, oh, they robbed that guy's vault and you're taking my money away to like even it out for everybody? Like, no thank you. Um, so anyways, it was bad and there's a reason why Bitfinex is not like, you know, the biggest exchange now. Um, so anyways, that— the money kind of sat there. Now fast forward, 5 and a half years go by. Last week, people start to notice bigger transactions coming from the, uh, the Bitfinex hack wallets. Um, and so they're like, there's these alerts on Twitter like whale alert, whale alert. It's like the coins are moving, the coins are moving, $100,000, $1 million of the coins are moving. $10 million, whatever. And so the Fed go— or not the Fed, sorry, Department of Justice goes, kicks down a door in New York into this husband and wife couple's house. And they look like your complete average Joe, clean cut. This is not like— doesn't look like a grimy criminal mastermind operation. And I'll explain a little bit more about that in a second, the funny bit about that., but basically they seize, like, their computers. They, they find, a bunch of burner cell phones. They find, like, a bag of, like, $50,000 of cash. They find a bunch of, like, the hardware wallets that had the Bitcoins in them. And then they found, like, folders on their computer that were, like, fake passport ideas and, like, like, places to go, places to run away. Like, they found, like, folders that said that shit on their computers. And, and they seized 3.5 $3.5 billion worth of Bitcoin because the price of Bitcoin has gone up so much. So that $70 million has become $3.5 billion worth. And so these guys were trying to launder— they don't think these are the hackers, but they were trying to launder that money. They may have been the hackers. I don't know. That's not proven, but they were trying to launder the money. And the DOJ had been like— if you've seen that meme of Charlie from It's Always Sunny where they had like the corkboard and he's like trying to like find the crime or solve the crime, that's what they had been doing because they had this web of all these wallets. And finally they found that, oh, it's trying to cash out in this wallet owned by this guy, Ilya Dutch Lichtenstein, or whatever.
But how, how did, what, what type of idiot would use his name?
Well, eventually you need to get the money out.
Is it just a sock account?
And so the problem is like, they were trying to get the money out through like Walmart gift cards. They were buying like $500 Walmart gift cards with Bitcoin. They were doing like PlayStation games. They were like, they were trying all these small things, but they could never move the bulk of the money. So if you want to move like in mass, you got to do something that ha— that lets you move size. And usually those—
could you buy an NFT and then sell it?
No, you need to get the money out of the wallet. That's the problem. So, so, so the problem— so in order to do that, there's like an off-ramp, right? How do you get it into, you know, US dollars, for example, if that's what you wanted to do? Um, and, you know, he left it there for 5 and a half years and they were probably living off and spending in some ways, but like, you wanted to actually like get a lot of it out and get, get it, uh, remove the paper trail of the blockchain, you need to get it as an off-ramp. But to get as an off-ramp, you have like a, um, you know, your ID, like these exchanges, they, they require you to upload your license and like they have laws they have to comply with called KYC, know your customer. And so eventually they found that somehow the DOJ, they didn't explain exactly, but they, they identified that the money was moving towards a wallet that was owned by a known person. That's how they ended up finding these guys. Now the funny part is— that's awesome.
Go ahead. So that— well, so the, I, when I read about this, I was like, wait, that name sounds so familiar. Both their names sound familiar. So the guy, his name is Ilya, I-L-Y-A. I think it was like a very like weird name. His last name is Liechtenstein. So he spoke at the first HustleCon. I never talked to him, but, um, he had a company called MixRank, which was just a normal startup, went through YC., and he spoke at HustleCon and then his girlfriend or wife, she was a copywriter. And I remember talking a little bit with her because she, her name's Heather Morgan, I think. And she had a, um, a website all about writing sales emails.
Totally.
Is that right?
Do you remember her? Before the hack?
She had like a red dress.
She had like a LinkedIn post on like 5 hacks for your, your cover letter for your job interview. Like, you know, like that sort of thing. And so yeah, she was doing that. She, and so they, And the funny thing is like the reason the internet kind of went crazy with it was because here you had two very unlikely characters. So we had a bunch of friends text us or text me because I was writing this edition of The Milk Road and I was like, anybody know this guy? And you knew him, but some other people knew him. They're like, dude, you would never get vibes of like this guy might just go launder billions of dollars. It was like smart, like kind of quiet, like engineer type.
He like showed very little emotion. No, I did not think that this guy, like, yeah.
And then her, she's like this, like, super strange Kanye West level weird, you know, like, person. She basically, she had like an alter ego that was called Razzle Khan, and Razzle Khan was her rap name. And then she has like these super fucking cringy rap songs on YouTube. Like, dude, okay, I have, you know, I have, you know, I think it'd be cool to be a rapper, but if I hear myself, there's no way I'm publishing that because It sounds so bad. And so, uh, it's horrible.
It's so bad. The top comment was Paris Hilton, I'm gonna prove to everyone that you can have, uh, that having money means you can rap good. And then it said Heather Morgan, hold my beer.
I didn't even know Paris Hilton has like a rap song. So yeah, yeah, there's just like, she's like one of the strangest characters. Like I watched, I went deep, dude, for this. I was writing this thing and I was like Oh, let me get some examples. And then I couldn't look away because like the train wreck, dude, it's like there's videos of her wedding. And like she, she like forced everybody to like— they built like this golden mini Taj Mahal that she sat in and then her bridesmaids lifted it up on her shoulder and brought her in. But even the audience at her wedding is like uncomfortably clapping, like offbeat, because they're like, this is— this is not normal.
There's like—
and there's like clearly only 14 people in the room. And then she does a rap performance at the wedding that was like equally cringy. And she's just like humping the air. Oh my God.
To the guy, Ilya.
Ilya. Yes.
Dude, this freaking guy. I'm looking at these pictures. That's hilarious. This woman's really hard to look at. She is just cringe.
That should have been her rap name, Cringe City. That would have been like, okay, I get it. You're gonna be the cringiest.
Cool.
Uh, that's like Henry Cejudo, the king of cringe. Uh, yeah, that's what she should have done. Like, it's super strange. But, um, but yeah, basically they recovered it. And so now what's gonna happen— anyway, it's just a bunch of interesting little bits to it. So the DOJ is gonna give the money back to Bitfinex. It looks like Bitfinex had— when they, they launched their own token at one point in time called the Leo token that's like used in their— if you trade in their exchange, it'll give you a discount. Using the Leo token. So they had to put in a thing when they launched the Leo token was like, hey, if we ever recover anything from that hack, um, we'll use 80, up to 80% of it to buy back and burn our Leo token, which will cause like the, you know, Leo holders to benefit from if we ever recover from this. And so now they're gonna get like $3.5 billion to buy back. So the price of Leo token like shot up like whatever, 60% in 24 hours. Cause people were like, Oh wow, that's going to be a lot. But they said we're not going to just cause a bunch of sell pressure in the market. We're going to do a controlled sale over like a multi-year period, um, so that it's like scheduled and doesn't like affect the Bitcoin market or whatever.
Um, God, this is such a good story. This would make—
this is— yeah, exactly. That's what everyone was saying is like, here comes, you know, incoming, incoming Netflix doc.
All right, next up we've got a story from Sean about a pitch meeting he was in and a very small and simple problem that he saw got solved. This And this led him down this idea of what he calls paper cut companies. These are companies that solve pretty small and simple, but very annoying and persistent problems. And they can be extremely valuable. Check it out.
So this founder was pitching me his company and he was just like screen sharing. So he was showing me a product demo and it was like a, it's like a data analytics tool. And he was like, yeah, so like check this out. If I go to Excel and then he like, he just opens up the browser I never seen this before. He goes, he's opened up the browser, he goes sheets.new, enter. And then he opened up a Google Sheet, like a blank spreadsheet. And I go, I go, whoa, whoa, whoa, what's just, what was that? And he goes, oh yeah, he goes, I'll show you later. Because he was so annoyed with me just going on tangents about every random thing he was doing. Like he wanted to show me his product, not the fact that you could type sheets.new and save myself. Like I fucking Google, I Google Google Drive, then I get to Drive, then I click new. Then I go down the menu, then I find spreadsheet, then I click new spreadsheet, then I get to a sheet. It's like this like annoying thing I do 6 times a day. And, um, and so just seeing this was like, well, that's awesome. And it reminded me that there's a whole company out there called GoLinks. Have you ever heard of GoLinks?
No.
What is that? So, so I saw this in a, um, or when I was working at Twitch, the kind of like whoever the, I don't even know his job title, like VP of everything, the kind of that number 2 guy at Twitch, my boss, this guy Dan, he was like, he's like, God, we have so many documents in this company. And now I just have bookmarks and tabs just with like all these docs open at all times in this company. He's like, and if I ever want to look up like, oh, the annual plan, it takes me like 5 minutes every time I want to find it. He goes, I don't know why we don't just use Golinks. And what Golinks does is it lets you set up a thing that's like go. Annual plan, or like, you know, you could just basically type in like a human-readable link and you could anchor it to any doc. And so let's say, you know, you've— that's anchored to the 2021 doc. Oh, now it's 2022. Cool. We just swapped the link out. We just— I said we like, we can still always type go slash, you know, uh, annual plan or go slash plan, and go slash plan will now take us to the 2022 doc. And I saw this, I was like, wow, this is actually so useful. To just be able to quickly find and like revoke access properly to, to different documents. And so, um, so I really like this. Most people haven't heard of this and I think it's a very expensive tool. I think it's like a pretty like enterprisey tool. I see at the top here they raised a $27 million, $27 million series A. Okay. So doing pretty well obviously. So I think somebody could build, this is like a very simple product. I think somebody could build a Golinks for like the startup level world.
More like you, bro. Indie hackers. I just invested in one.
Oh really? What is it?
Yes. So I told you about it too.
I swear.
I'm in this too.
Oh, I, so that's the same thing, right?
So this is, this is slightly different. I don't think they do the shortcuts to the links. Maybe this is a feature they should add. What they're doing, what Nira is doing is we all, companies have all these docs and then people get fired or they move teams or whatever, but people still have access. It's like, oh yeah, I still got this link. It just opens up the, like the numbers for the, for the company. Or like, yeah, this contractor we hired still has access to all of our files, but like who the heck can go audit and keep up and scrub the access for this thing? That's like, it's like a very big problem. Like your company's most sensitive data is all in the cloud and then the cloud, like access is shared amongst like so many people and there's no central place to see who sees what. And so Mira's building that. They're building the who has access to what. Yeah.
But I think the link thing is a feature.
Maybe. Yeah, maybe it is a feature. I'm saying I think it's a feature that can be standalone because adopting something like Mira is like something that's going to go through my like, you know, chief security officer type of thing. Like this is going to go through our CIO or CSO. Whereas this GoLinks thing is something that like, you know, me and my one person who I work with, like we're both just irritated with these super long, ugly Google Docs links that like, um, you know, like we can't find anything. It takes forever to find stuff.
They, they have a free plan.
Neura does.
No, GoLinks.
Oh, GoLinks does. Yeah. Yeah. I think, yeah, I don't know what, at what point they, they do this, but I don't know why this is not more popular. This is like a, like a real problem. And then this also just got me thinking like, what else is like this? What, what are the other problems that are like these? Like I call them paper cut companies. So death by a thousand paper cuts. So what's a thing that's irritating, but you do it so often that it's just a constant paper cut that just annoys you? Screenshots is another one that sharing screenshots was one that was a big paper cut. I invest in this company called Bubbles that tries to make that better.
Loom makes it better. Is it working? I remember Bubbles. Is it working?
I don't know. I haven't caught up with them in a little while. I know it was working initially, They raised a bunch of money, uh, from that, but I feel like it hasn't taken over like, you know, the Loom market yet, but maybe it's going into a different market.
I'm not— dude, the screen, the screenshot one's a good idea. Also the copy and paste, the copy and paste. I've been thinking for years, how can I optimize a copy and paste? Yes. A better clipboard. I've been thinking about that for a long time. Um, it's been, that's always an interesting thing to me is, is, is the clipboard that, that's really intriguing. But the, the, the problem with these types of products is you have to truly be inventive. I don't particularly have that muscle to like be that creative. So people who invent things like this, or like even like, um, what's that guy named Howie who's got the huge company? Uh, Airtable.
Uh, creating something like Airtable, which is basically kind of like Excel but different and better, or even creating like a Notion. I don't like— these people kind of are geniuses who can like come up with like these weird product features and like they just know that like if you hover your mouse over this, it needs to like that. They're so complicated. They're so complicated. It's pretty amazing.
Yeah. They, um, they're big on details and I'll tell you the, the best thing I heard about details like this, I'm, I'm not detail-oriented. Like if, if this camera showed my desk, you would see like, yeah, I, I'm obviously not organized or detail-oriented. Like everything is sloppy. Even my camera right now is actually slightly crooked, but I just don't care. I just don't care about details and pretty much anything I do.
So that's why you're talking with like your neck a little.
Yeah. That's why I like often do this. I end every podcast with a crick. Um, but you know, like I'm not a sweat the details person, but I remember the first time I used Slack, I used Slack really early on. It was like in beta. I should have invested in it. I just wasn't an investor back then. I didn't think about it that way, but I used it. And I remember the first thing, uh, one thing I did was I, I was telling our designer, hey, uh, yeah, here's the color for like our logo or whatever. Or they sent it to me and they just sent the hex code. So like, you know, hex, you know, like #CFFR, you know, 373. And it just turned it into a small tiny color swatch. And I remember thinking, why the fuck did they do that? Like, what level of care went into caring that the hex code would just auto-format with a little swatch next to it?
That's what I mean.
Nobody would do that. Unless you were like a real product designer who sweat the details, who used this product all the time and just dedicated yourself to like anytime you could just scratch your own itch and irritate, like remove one paper cut from your own user experience, you're going to do it. And so this is why also working on your own products, working on products that you want to be the user of helps because you'll get so annoyed at the paper cuts, you'll just get rid of them yourself.
All right. Next up, we've got a clip from Max Litvin, the founder of Grammarly. You might have Grammarly installed as a Chrome extension. If not, you really should install it.
It's great.
Very helpful. I use it all the time. But what you might not know is that Grammarly, this Chrome extension, is actually a $13 billion company. And on this clip, Sam talks to Max about how he knew this kind of random market could actually be a really big opportunity.
What were your goals early on? Like when you started the business, were like, man, I think this can make $10 million a year and provide a good lifestyle, or Like, I think this could— or was it like, I think this could be like a multibillion-dollar thing? Like, what were your goals early on?
I think we decided that it could be a multibillion-dollar business during our conversations with Brad, partially. So kind of Alex and I, we, we, we hoped that it could be. But then once we started talking with Brad about valuation plans and all that, when he was thinking about joining, then it became pretty clear that yes, there is a multibillion-dollar market out there. Are we going to capture it or not? To be, to be determined. But at that point, but there is definitely an opportunity. So the size of the opportunity became clear fairly early. But past there, that, that took years.
What was the vision? That made, or what, what did you see that made you feel that it could be a multi-billion dollar opportunity? And what was the vision? And were there any, was there any numbers that you saw early on that would said like, oh my gosh, there's something here?
Yeah. So I think the breakthrough moment was when we saw that it is possible to help not just professional writers, people who write for a living every day, but also help casual writers or people who write as part of their job or part of their life, but not like a key part. So writing is not their like main product. They're no, no, like novelists or researchers who are published and so on. So when we saw that it's possible to make a product that's useful for everybody else, then it clicked. And the very simple formula, if you look at amount of time we spend communicating and creating knowledge as a humanity, as all people in the world, it is a huge percentage of our time and it's increasing because we spend less time doing things with our hands. Manufacturing is being automated. It's not like we were doing it manually anymore as much. So if you take this time that we spend communicating and creating knowledge and make it even 1% more effective, The impact is in trillions, not, not even billions. So can we do something that makes communication 1% more effective on average for everybody? That doesn't sound impossible. That sounds like something that's doable. That's doable.
So, so we decided— I had that same insight, except I did it in such a horrible, worse way. So basically, I learned how to be a copywriter. So like I read books on copywriting and like on persuasive writing. And my theory was like, oh my gosh, like with texting or like online dating, I was single at the time and 21. So it was all about like dating. I'm like, oh man, if I were to learn how to write better in my messages to girls who I match with, like my life is going to be better. And then I was like, wait a minute, if I learn how to write better, I could sell more stuff. If I learn how to write better, I can make people feel emotions about like this cause that I want them. I'm like, just writing better, like, it changes, it makes life more practical, but also it, it, uh, makes you think better. So like, if you can, if you have an idea for something and you're forced to write it out, you'll see all the holes in the idea and you'll, and you'll force yourself to like lay it out. And so I was like, oh, I'll teach people how to write better. And so I created a course on how to write better. Of course, like obviously creating a software product, it was outta my league, but like that was, clearly the better move to do. But the same insight was like, everything that we do is via a text, whether it's a text message or an email or a website. And even if it's via like the spoken word, I have to write that anyway. So like writing is like the most important thing that you can master. I just wish I would have approached it in a software way as opposed to just selling a $300 course.
Yeah, software is more scalable. That's, that's true. And And actually, what you said about writing, it also applies to speech. We, when we do user research, we notice that people who use Grammarly repeatedly adopt patterns of communication, more effective patterns of communication translated to non-written communication as well. So for example, if Grammarly keeps suggesting that you don't use kind of a wordy or vague or weak sentence structures, You stop or reduce use of them in speech as well. So I— so kind of good habits rub off and translate to other modes of communication.
All right. Finally, we've got a clip from Sam and Shawn. They were talking about whether the Olympics were a waste of time. Shawn thinks that the Olympics are a waste of time for many people. And that's not what I'm going to post here. But what this is, is the discussion they had afterwards where Shawn talks about this idea of not accidentally over-indexing on something that doesn't actually matter to you. And I think it's a really valuable point and something important to consider. Let's give it a listen.
I think that there's like, uh, you know, like for example, if my kid was like, had the potential, if you told me right now, hey, your kid has the potential to be the greatest, you know, like at, uh, whatever, um, the greatest third person in the bobsled in, uh, in the country, but here's what you have to do every day, every weekend. For the, you know, the next 20 years of their life is going to go into optimizing their body and mind to be able to do this, which essentially is what goes into like becoming an Olympian, right? You're trying to become the best in the world at an arbitrary game that was made up, and you have to sacrifice a huge amount of your life and focus and attention and energy and talents you decide to invest into this. And the thing you get out is character building, life lessons. And the other thing, you can get that from the Boy Scouts, you know, potentially a moment of fame when, if you won, if you actually did achieve the thing and you have the, you know, sort of the, the, the knowing inside your heart that, that this was, this was good. So like, you know, would I rather be, you know, Steve Prefontaine, this, you know, this good-looking mustached runner guy, or would I rather have been Phil Knight? I'd rather be Phil Knight. I think actually he's the perfect example. What did Phil Fontaine get out of, you know, Nike? Nothing.
And so he actually—
where is he now? Right.
He died 3 years into founding the company from a drinking and driving accident. So, yeah, you're right.
Okay. Joke's not so funny now.
It didn't work out.
He, he, he was a— he was in their crew and he was their first sponsored athlete and like their 5th or 10th employee or something like that. And if you ask Phil Knight who, you know, what's— who's Nike's mentor or sorry, who's Nike's mascot, they'll say it's Prefontaine. Yeah.
So anyways, my point is I think that there's a lot of things that are fun and they're best done as hobbies versus trying to become the best in the world at it. Right. I can play, you know, Call of Duty and have a bunch of fun with my friends. I can even play, you know, the competitive side of things just because I like to scratch that itch. And I play a couple hours a week. But once I try to become the best in the world at it, the level of sort of sacrifice and over-indexing on that thing— and hey, you could do it. You could over-index on anything. You can try to become the fastest typer in the world. You could try to become the best photographer of brown leaves in the world. And you know, like, you could do all those things. So choose carefully. Choose which one you want, what you really want to go into.
It's like people who dedicate their lives to be an average D3 basketball player. It's like, It could work. You could, you could, you could go to the NBA, but like, odds are the papers or the writing's on the, on the wall. Like, it's probably not going to happen. So maybe you should actually like study a real major instead of basket weaving or communications.
Right. And if you enjoy it, fantastic. If you're enjoying every step of the way, fantastic. But a lot of things in my experience are most enjoyable when done as hobbies versus when done with the competitive pursuit of becoming the absolute best in the world at it. The guy used to work out of his dojo. He used to tell me that. I was like, oh yeah, I really like this, so I might start a business around it. He goes, oh yeah, Dave Grossblatt. He goes, easiest way to fuck up a hobby is turn it into a job. And I remember just hearing that, being like, huh, that's interesting. I actually never really thought about that. Yeah, actually there are some things that are really fun as hobbies that become really unfun as jobs, right? It's like working at a Cinnabon, right? It's like, oh yeah, I love eating Cinnabon. Working at a Cinnabon, smelling the Cinnabon, eating free Cinnabon anytime you want. Now it's not so fun.
All right, that does it. Thanks for listening. Have a great weekend.
I feel like I could rule the world.
I know I could be what I want to. I put my all in it like no days off. On the road, let's travel, never looking back.