Michael Sonnenfeldt: The Most Successful Real Estate Deal of All Time and Building a Community of Billionaires

What was the original fee and what was the requirements?

Um, the original organization 20 years ago started with people who had created net worths of between $10 million and $100 million. And very quickly the top end exploded with success. Uh, so it grew to $1 billion and, um, more recently we've Realize that our focus is on members between $20 million and $1 billion. And what I was gonna say is the main difference between Vistage and YPO and Tiger 21 is the average net worth of Vistage and YPO members is probably maybe a tenth of that or fifth of that of Tiger.

How long ago, uh, did you start the company?

Uh, about 21 or 22 years ago at this point.

What was the original idea?

When you originally started the business, what was the, uh, like, what was the product? Was it like YPO where it was a monthly group meetup? What was it?

Sure. So, uh, you mentioned YPO, which is a fantastic organization. There's another similar organization called Vistage, and they both are for CEOs. And, uh, if those are the great colleges, we're the one great graduate school. And so we have a lot of YPO members that graduate into, uh, Tiger 21 and a lot of Vistage members that graduate into Tiger 21. Uh, and just to give you an idea, the, uh, Last time I looked, both Vistage and YPO have about 50,000 members globally. It might be 60 now. I've lost touch.

Vistage has 50,000 members?

No, and YPO each.

Oh, oh, oh, okay.

Yeah, that's about 30,000 each, I think. Could be a little more.

I haven't looked in a couple years.

That's a huge company. Oh, these are huge businesses, sure.

'Cause Vistage charges like 50 grand a year, right?

Or 25 grand a year? I think Vistage is around 15,000 or 18. I don't have the exact number, could be 20. YPO doesn't have a single price 'cause depending on whether you go on the trips and there's different people pay different amounts. But the big difference between those two, which are great organizations, is YPO is self-facilitated by its members, whereas Vistage and also Tiger 21, our groups are led by professionals. We have over 100 groups around the globe now. And so we have a cadre of over 40 professional chairs, might be 60, excuse me, 60 professional chairs that we've trained exquisitely to lead these incredible groups. But the bottom line is that those are the two great organizations for CEOs and business owners. And when you decide as a rule for life that you wanna get off of the merry-go-round for whatever reason, uh, the next decision point is best, uh, focused on with peers that you'll find in Tiger 21.

So basically the original premise, and you could tell me if that's still the premises, you, um, you have a, uh, a small group of peers. I don't know how big the group is. You could tell me.

12 to 15 people.

So 12 to 15 people and you meet of some type of cadence, like 4 or some weeks monthly, full day a month. And you have a coach or what do you call your coaches?

Facilitators.

You have a chair.

They're the chair.

You have a chair who leads these discussions and what was the original fee and what was the requirements?

That's crazy. And what's the price now?

Uh, the membership is about $33,000 a year. That's, that's— we, we try and have a kind of one price. So the only thing you pay is a single membership fee, uh, unless you come to the annual meeting. There's lots of other events that are included, but because there's hotels and all that kind of stuff, if you come to the annual meeting, there's an additional charge of a couple grand.

So I, uh, I, I can't do the math in my head, but like, that's like over $100 million in revenue.

Oh, I thought you said 12,000 members.

My bad. 1,200. And, uh, and that's what it costs to run.

That's crazy. And what's crazy is $10 million today is a lot, is a significant amount of money. 20 years ago, $10 million was obviously a significant more than it is now. How do you, how did you find your first folks?

What was your first business?

My first business?

The one— or sorry, the one that you sold.

Uh, the first business that I sold, uh, I developed something called the Harborside Financial Center with a partner. We were 50/50 partners. I was 25, he was 57. It was the largest commercial renovation in the country at the time. We bought a rundown warehouse that had been the largest building in the world in 1929 when it was built. Eclipsed a few years later by the Pentagon, but it was an industrial warehouse on the waterfront in Jersey City, directly across from the World Trade Center. And I had the idea literally when I was 17, 'cause I worked there when I was 17, that it was just 3,000 feet from Wall Street. And what was happening is that was in the age of large computer centers.

Mm-hmm.

And so you had all the downtown Wall Street firms building computer centers. And if they didn't wanna be in Manhattan, They would go to a faraway campus on a suburban, you know, somewhere in suburbia, and people felt like they weren't in suburbia, they felt they were in Siberia. It was too far from the mothership. And I had the idea that if you could put some of those computer centers into this huge industrial warehouse, it would be 5 minutes from the parent under the Hudson through the PATH train, and in 3 minutes, you could get back to whatever the parent company's parent was. And that was sort of the original insight that this old industrial building had floor loads and ceiling heights that would accommodate raised floors for computer centers and the weights that you needed, the weight loads, the floor loads. And that was basically the idea.

And that's the thing that you sold before, but that was—

Yeah, I sold that when I was 30. Then I did another business that was basically a real estate merchant bank that acquired a lot of distressed real estate when the real estate market crashed in the late '80s. I don't know if you remember that the stock market crashed in '87. The real estate market followed. And so I was able to acquire a couple hundred properties from banks that had gone under and the federal government had taken it over. And when I sold that business in 1998, I said, I don't wanna have to go back to work. I wanna know how to preserve money. How do people who've sold their business, how do they think about what they're gonna do so that they don't take stupid risks and find out they've lost it all?

Has building Tiger 21, you kinda, was Tiger 21 supposed to be a, —no, no, it's actually, it's been a labor of love for me. But, you know, oddly, was it able to create more wealth than the other things?

No, it's, uh, it's, it's, it hasn't at all. Uh, basically for 20 years I put every penny back into Tiger of revenue because I wanted to hire some of the best people in the world and the best teams and get it right. But there's a lot of inherent value in it, there's no question, because we have extraordinary members and the value of our franchise has to do with our members and the team we've put together was incredible. But I realized that in order to scale the business to fulfill its potential, I needed more senior help. And in order to attract that senior help, I needed people who were interested in equity. So having a private equity partner made it easier to attract world-class talent who would own part of the equity.

You're kind of in an interesting position, which is like, you know, or you work with a significant amount of wealthy people and you have some interesting insights Where, what have you seen are kind of like the levels of wealth that someone would like, they see changes in their life.

I've read a, a bunch of stuff like that. And if, well, the way that I remembered it, and I could be wrong, it was like 2x. So it was like, Or maybe it was for net worth. So like if your net worth is a million, you're like, well, I would feel a lot better if it were 2. But then they talk to people who it was 100 and most people would say like, man, if you have 100 liquid, like it's going to be a little bit hard to screw up. But even they were like, yeah, but if I had 200, I think I would finally feel more comfortable.

There was that one article that came out that's total nonsense. It came out years ago. It said like you don't get significantly happier after a certain amount. And the amount they said was crazy. It was $70,000 a year. But of course this was like 15 years ago. And I thought that was crazy. I'm like, I don't think that's true. But, or, and I was like, I do think there is like a number where it's like, all right, maybe like there's like a threshold here where you're, you could definitely continue to get happy, but like there's a baseline. And, um, I always thought, I'm like, I think you will always want more money. But today, maybe like, if you have, if you're in like the 10 or 15 range liquid, I'm like, maybe there's like, all right, maybe life won't change significantly more after that. Because like, you know, like that's, you could screw that up, but like, you got to kind of screw up majorly and But I don't know. That's kind of what I always thought. What do you think?

The 70,000 is a number that shows up in literature, meaning below 70,000, every increment that you get closer to it, if you were earning $30,000 and you get to $50,000, $50,000 to $60,000, anything up to $70,000 increments have dramatic increases. 'Cause it's just kind of obvious. It's basic needs. You need to put a roof over your head. You need to put, square meals on the table, you might need a car, and at $70,000, you can pretty much afford most of those things, not in the lap of luxury, but you can afford those things. Below it, it's really, really tough. So that's kind of, it might be $90,000 today with inflation, but it's somewhere in that. And I don't mean to trivialize the difference between 70 and 90, but everything above that, you know, for every level that you have, You can just spend more and create the same sense of being overextended if you're not disciplined. And it's the rare person who generates excess, uh, capital and doesn't change their lifestyle. So no matter how much they have, they keep spending more. Because if you can keep that gap of not needing what you have, that gives you a cushion, uh, that's rare and really, uh, something remarkable for those who have it.

Have you met people who have done that, who have been, let's say, worth hundreds of millions of dollars but still live like— don't even live nearly like that?

Well, you know, the most classic example would be Warren Buffett, who still lives in a $30,000 or $50,000 or $100,000 home that he bought in the Midwest where he lives, in Omaha. And You know, it's really hard to have one person comment on another person's health. You wonder what's all that money for, but now he's given half of it or something to charity, and there's tremendous benefit gained from the money he's given to charity. But, you know, it's one thing to live within your means, that's responsible. It's another thing to be so disconnected between your wealth and what you're living, that there's something going on inside. And, you know, I'll leave it to the shrinks to figure it out, but it's kind of hard to understand why a person who might be working 60, 70, 80 hours a week, as if there's no tomorrow, and then they might be worth a certain amount of money, but they're living on 100th of it. As if they had a hundredth less, you know, they had 1% of the wealth that they do. What are they hiding from? There's lots of answers. They're all dependent on different people.

Most of the people I hang out with, so I'm 32 years old. I started an internet company. My co-host Sean is a little older, a year or two older than me, also started an internet company. And the majority of our friends are in like the late 20s, early 40s age. And like all mostly, except for a few, in the internet. And so like I run in this like very like, like internetty, young circle. And the vibe that I get from Tiger is that it's a little bit older and more like traditional businesses or maybe finance or real estate who have, who have kind of knocked it out the park. Um, is, is, is Tiger 21 mostly— am I, am I categorizing it correctly or do you guys actually have like a lot of young folks?

Only because of, only because of how we've grown. And when you have, you know, 1,150 or 1,160 members, the answer is the average age has fallen over the history from the high 50s to the low 50s. But in order for it to do that, given that a lot of people stayed, most of our new members are in their 30s and 40s. So we have a lot of internet folks, but the reason they're joining TIGER as opposed to something else is when they're sitting around, they're not just sitting with internet folks, they're sitting with people who have real estate experience and experience running businesses in the world that isn't just from the internet. And the reason we're so excited to have folks that are in the crypto space or the internet space is precisely because they're understanding these new technologies that are gonna transform the world in a way that many of our members wouldn't otherwise. So it's this combination that makes, uh, some of our meetings so electric.

Have you noticed a difference between, like, let's just say Group A is like these people who are made their money on the internet, made their money in only like 3 or 8 years, uh, all selling just internet stuff. So, you know, like not real stuff that you can touch versus let's say like the small business owner who like scaled something over 20 or 30 years and then eventually sold it or made cash flow along the way versus the tech person who was probably poor for a long time and then suddenly, boom, they're not because they sold their business and they weren't ever profitable. But have you noticed a difference in those people's attitude or the problems they have?

Well, they're probably, you know, as many differences as there are people, but there's some fundamental truths that I think you're pointing at. You know, when I went to business school at MIT 40-some years ago, you know, if you were doing a marketing exercise, they'd say, "Come up with a product that you could sell to 1,000 people." And today, if you go to Stanford to a marketing course, they say, "Come up with a service you could sell to a billion people." Literally a billion people. That's what Facebook does and some of the other major social media. So scaling is not just a difference in size. We have a dramatically more frictionless economy. The nature of internet and technology allows businesses to scale. That's why we have unicorns today, but we almost never did in the past. So when you think about life expectations, people who started out 30 or 40 years ago had an expectation that they'd have to put their nose to the grindstone for 30 years before they'd hit a payday. Not all of them, but some of them. And of course, there are many different types of wealth. I distinguish between people who are workers versus people who have some kind of God-given talent, a singer, a basketball player, an actor, a rapper. These are people not who are building businesses, but have God-given talents, of course they have to work hard to hone those talents, but it's very different when your wealth is created from your own talent than when you have to scrimp and save, you know, to make a payroll and get everything done. But then if you compare that to people who are creating wealth today, first of all, they can do it in 3 to 5 years. You have unicorns in, you know, 3 to 5 years or not much longer. And so one of the big differences is that if you were 58, 20 years ago and you sold your business, you probably were retiring because you spent 30 years doing something and that was your first sale. But today, if you sell, you might be 30 or 35 or 38, you're not retiring, you're going on to the next thing. So the, I think the biggest, difference is this kind of expectation of what a life looks like. You know, a generation ago, a really successful entrepreneur had one or maybe two serial successes. Today, a successful entrepreneur could have 3, 4, 5, or multiples because he or she has figured out how to manage a couple at the same time. Elon Musk is not the only person, who has multiple businesses. He's certainly the most visible, but it's much more a creature of today. Uh, it happened in the past, but just much less so.

When I was selling my business, I would talk to some bankers and I would talk to some friends and advisors and a nice amount were like, yeah, sell it and get paid. And like, you know, you don't have to worry about money anymore. And that's wonderful. And then the other group of people though were like, Man, starting something that works is really, really, really hard. And a lot of people sell a business and want to start it again, and they don't realize, like, you know, like, there's some luck involved, and it's just actually really, really challenging. And sometimes you get confident, you think, oh, I could just do it again. And so if you don't have to sell it, never sell it. And I've lately fallen in the category of, like, if you don't have a lot of money, sell a company if you, if that means that you're like financially secure. But then after that, oftentimes try not to sell anything ever. Uh, like to see if you can just like run it or get it to run it on its own or hire people because it's quite hard to get, getting something going is such a pain in the butt. Do you fall, do you tend to, uh, when you're talking to your members, do you, what, what do you think most like, which of those categories do you think is actually a little bit more true or more common?

When I sold, I mean, I didn't know it, this was only a year and a half ago or a year and a couple months ago. I didn't know anything. Like, I mean, I knew nothing. Like, I didn't know, like when people said that they're gonna short a stock, I was like, I don't know what shorting means. And they say they're gonna go long. I'm like, don't know what that means. And so, uh, like it was, and people like, you know, friends and family were like, well, what are you gonna do with your money? And I'm like, I don't, I don't know anything. Like, I think people are surprised that your ability to earn is not often correlated with your ability to like invest.

Uh, just the opposite. That's, that's what I'm trying to say. You can be a great entrepreneur and a really lousy investor. And, you know, just to give an expectation for people who might be listening, how long do you think it takes to go from being a successful entrepreneur that is a mediocre investor where you were a year ago? How long do you think it takes till you have sort of a modicum of confidence that you know what you're doing as an investor?

I mean, years. I don't know. I mean, I've been studying it now for a year and a half and I feel like I don't know much. 5 years.

What I just did was put, so I, are you familiar with HubSpot? Sure. So they're the ones who bought us. So I own HubSpot stock and then the rest was just mostly a Vanguard total index fund and some real estate and real estate funds. What, uh, With your folks, what's like the asset allocation of like what you've seen? What's like a fairly successful—

Sure. So I wanna be really, we're not an investment advisor, but I do track the asset allocation of our members and can simply report on it, which is—

Yeah, you guys put out this annual report. That's awesome. I love that.

So the asset allocation very roughly, is traditionally real estate has been king with about 28% of the assets, maybe 27.

Does that include primary residence? No, generally not.

It's mostly investment real estate.

And does that mean they own it or they're in a REIT?

It could be they're in a REIT. More likely, they either own a building or they own a limited partnership in a real estate fund. Of some sort. Second would be public equity, about 26, anywhere between 24 and 26%.

That's so much lower than I thought.

What do they love about real estate so much?

We always make a joke that people, they get offended about this, but I'm like, it's kind of a compliment. We always say that real estate has the highest number of, dumb rich people. And that was kind of like my story.

Dumb like a fox. In other words, they may not people who have the same intellectual pursuits that you are, but they can go and smell an opportunity and sniff out where there's a problem in a way that most other business owners don't. And that's why I say it's very deceptive because they're a breed apart, but that's become a little less so in the last generation. Because as real estate became more securitized with different types of ownership and debt that went to Wall Street, it became more of a Wall Street game. So, it's a little more today a Wall Street game than it was 20 years ago. Yeah.

And the strategy that my wife and I had was let's just try to get somewhat wealthy with tech stuff. And have that continue to make cash flow and, and, and, you know, selling companies and pile a lot of it into real estate because that's something— because like with my business, we had to send an email every day, but if Gmail changed, like, it could go out of business. A building that I own, I could lose a fair amount of money on it, but like, there's— it's still a thing that someone will purchase even if it's at a huge loss, but it's not going to go to zero, whereas my company, it definitely could. Like if I owned a conference business and a pandemic hit, like, which I did, uh, like it went, it literally made $0. Whereas this land that I own that I'm looking at right now, like that's probably not gonna go to zero.

You know, none of these things are as simple as we'd like. I think you're making some really excellent points, but if you owned retail or, um, movie theaters, uh, or airports, in the pandemic, that went to zero too if you had any leverage on it. So it's not that real estate— I'm being hyperbolic, but like, yeah, in general, I totally get it. It, it's not that it's without risk, but as an asset category, it's a, uh, long-dated asset. I can't find this client info.

Have you heard of HubSpot? HubSpot is a CRM platform, so it shares its data across every application. Every team can stay aligned. No out-of-sync spreadsheets or dueling databases. HubSpot. Grow better. Uh, one more thing about the selling and, uh, selling versus not selling, because you have a way bigger sample size. A, do you regret selling your companies? And B, the thing about selling, like, let's say that you sell a business and you make $30 million, you pay taxes, now you're left with $20 million. To make $20 million like you could build a business for 5 or 10 years, sell it and make that. To make $20 million after, to make $20 million from cash flow, annual cash, and that's really freaking hard. Like you gotta, I mean, your taxes are higher because it's income versus capital gains. But, and then you, I mean, it's just like, it just seems like selling a business is probably the easier of the two and it's still not easier.— it's still not easy. It's the easier of the two to accumulate like your first bit.

Would you agree with that or no? Well, it's— the problem is that it's better to think of it as a shift in risk because when you made the decision to sell for $30 million, the example you just gave, what you've done is you've taken a lot of risk on the table So the chance of losing that $30 million now goes down radically. It's much less once you've turned it into cash. But the chance of getting to $60 million might've gone down also, 'cause you lost the engine of growth. So it's, you know, do you wanna sleep well or do you wanna eat well? Are you long-term greedy or short-term greedy? But there's no question that when you sell your business, In my opinion, more often than not, it's not number dependent, it's risk dependent. You wanna take risk off the table. You don't wanna have the risk, just as you said, of losing your business anymore. So you can take your chips off the table and diversify it over a number of investments. But it's gonna be much harder if the business was a well-functioning, growing business to get to that. You've increased the hurdle rate before you can get to that next level of $60 or $80 or $100 million.

Do you regret selling your two things and Tiger? Or so you didn't sell it.

First of all, I'm still the chairman and majority owner of Tiger, but it's run as if I'm 50/50 partners. And Tiger would be a great example. I'm 66. And when I sold Tiger, The risk that I was most concerned about, because I'm a cancer survivor, is longevity and sustainability if something happened to me. So, our board said I was the number one risk. And because I love this business, I said, "Well, how do I reduce that risk?" Well, the first thing is I bring in a co-owner. And the second is we bring in a world-class CEO. And in order to bring in that world-class CEO, I needed to bring in a co-owner. So Tiger is immeasurably stronger today from a team point of view and an ownership and a resilience point of view. It is still my legacy. I'm the founder. It was my idea, but I never went into it for money. And I'm not sure that I would've done any better on my own. I think the diversity of ownership The addition of a team that we built into a world-class team is just dramatically different than I could have created on my own. So, I have no regrets whatsoever with Tiger. And with the other businesses, it was interesting. I sold my first project that I mentioned to you when I was 30.

And that project— Can you say what you sold it for so we have context?

When, when people, one of the surprising things when I kind of started, when I sold was I had never heard of this thing called an asset-backed loan, which is like basically one example of that is when rich people buy a home, you'll hear that they bought like a $5 or $10 million home in cash. And oftentimes what that really means is they're using this thing called an asset-backed loan. So basically if you have a stock portfolio of $10 million and it's like in a Vanguard index fund or some basic thing like that, you can borrow like 60 or 75% of that at a given, a very, very low interest rate, as low as 1%. Um, what were, uh, what were some, some, what are some surprising things that people who come into money after selling their company that they, uh, that they see? And you're like, eh, like when I, when my banker told me about that, I was like, Are you kidding me? This is like, this is how people do it. This is amazing. What are some other things that kind of fit in that category?

So I'm sorry, but I would never do that. Most Tiger members, yeah, yeah. Most Tiger members wouldn't for two reasons. One, uh, I don't have any debt. I wouldn't want any debt. Uh, debt can be very corrosive at exactly the wrong time. You know, the market has just gone down for people who are levered. They could have been wiped out. If you want to be here for the longterm and preserve wealth, I would argue you want as little debt as possible.

I'm not suggesting that's a good idea.

No, no, no, I understand.

It's an interesting option that people have, like they can use it to pay taxes.

Sure. But the other part of it is that 1% can be illusory because the rate can go up if it's a floating rate. And if you have a spike in interest rates and you made assumptions that you were borrowing at that low interest rate, and then it goes up, you can really wreak havoc with your balance sheet. So, one of the things that most Tiger members enjoy when they reach a level of wealth is the ability not to have debt hanging over them. Now, having said that, who are the best managers of debt? Well, private equity firms and real estate is the place where most debt is. So, people who've spent a career managing debt understand the power of it, but they just understand that at some point you want to reduce risk and take chips off the table. I think the other thing is something you said before. Not everybody fully appreciates why they became successful because for every person who had a plan, somebody else was lucky, let's say. Doesn't mean that they didn't have a plan, but fundamentally they're lucky. And it's just a statistical thing. The number of people who've had 2 successes is dramatically smaller than the number of people— it's a bell curve of who's had 1 success. And for people to have 3 and 4 successes gets down into the, you know, 1 in 1,000 entrepreneurs or something. And I think that, um, Many people systematically overestimate their own skills when they've been successful. And there's a real comeuppance that after they sell their first successful business, they assume they'll be successful in the next one. And they get their clock handed to them as I did when I was 30. It was a very painful lesson, but it was the most valuable lesson. Why? Well, I sold this amazing project when I was 30, and then I started a business in the real estate information. This is before the internet, you know, pretty much what Zillow is today, where you can look up any house and get a price on it. We created a business that was a precursor to Zillow before there was an internet.

It was a— How much of your net worth from the previous thing did you invest into this new thing?

We, we were talking about earning money. What about spending money? Uh, like something that I ask myself is, I'm quite frugal and I say like, I don't wanna buy this, this and this cuz it costs too much money and I just don't, It just— some stuff like owning a lot of objects in my home, it kind of just stresses me out because I feel like I got to take care of it. But then there's other things like flying nicely or staying at fancy hotels where I was like, I don't want to spend money on that. And then I was like, well, you know what? That actually makes me happier. This is fun for me. I should spend because that—

Yeah, way too high.

It's $20,000 a year. Learning is really fabulous.

I, uh, there's this, um, funny, cool subreddit, a Reddit, a forum that I go to, and it's called Fat FIRE. You know, you know what FIRE is? Like, FIRE is like financially independent, retired early. Fat FIRE, and typically FIRE is like people who want to save like a million dollars and live off like $50,000 a year. Fat FIRE is people who want to like earn a huge, you know, a much larger amount and live somewhat lavishly. And on that subreddit, the number is like 3%. So it's a little bit higher than 2%, but like 3%. I think there was this thing called the Trinity Study and they said like 4%. Frankly, I think that sometimes is too high, but like the— I kind of buy in the 3% range. And anyway, there's this one book. Have you ever heard of this guy named Felix Dennis? No, I don't think so. He's amazing. He's kind of— he's dead now, but he's kind of like a combination of Mick Jagger and Richard Branson. So he was this, he was this British entrepreneur and he was kind of flamboyant like Richard Branson and like did a bunch of stuff, but he was like Mick Jagger in that he was like kind of a degenerate, like he loved drugs and hookers and he was like, he wrote about like his escapades when he got older. He was like, I had a drug problem and I was never married, so I was just like sleeping around. And so he's kind of like a fun guy to read about, but he's got this book called, uh, How to Get Rich. It's kind of poorly titled in a way that it's like embarrassing to talk about, but it's quite a good book. And he was like, he, he eventually founded, um, Micro Warehouse, which was a publicly traded company, but he also started Maxim Magazine. He was a publisher. So he made all of his money in magazines. And he was like, so I'm gonna die soon cuz I've got cancer and I'll die with like a $600 million net worth. But if I could do it all over again, my goal would've been to make $20 or $30 million by the age of 35 and not focus on money making ever again and only focus on like the people I cared about. But like a boxer who's punked, uh, punch drunk, I went back into the ring every time because I was addicted to it, even though it, it didn't always bring me the most amount of fulfillment and happiness.

I just want to share 3 reactions to that. The first is there was a band leader from the late '60s or early '70s who was being interviewed a few years ago, and the announcer said, you know, "you were the first band to make $1 million a month. No band had ever made that much money. What'd you do with all that money? You guys must be rich." He said, "Well, we spent about 70% on wine, women, and drugs and wasted all the rest." But the thing with Mick Jagger is what you don't see is he like works out 6 hours a day. He eats a food regimen that's like second to none.

And here's a guy who's— Maybe Keith was a better example.

Yeah. Well, that's important because even with Richard Branson, with his, whatever your persona is, he knows how to lever from a marketing point of view. He puts like nothing into a business and others invest around his name. So his risk is very low. These are people who are real geniuses at what they do. But the thing that you didn't mention is philanthropy. Like, how does people create meaning? I think that people who've created a certain amount of wealth and then say a higher percentage of what I'm gonna make, I'm gonna give back to causes that I believe in and try and make the world a better place. I think that's a really important way to get meaning. So that guy who made $600 and said, "I should have just made $30," maybe he should have just been a little more philanthropic and looked around the world and said, "I can make an impact in a positive way." Have you heard of this book called, you got a ton of books behind you, so maybe you have, it looks like you read a lot.

Um, well, that, that was the biggest debate You know, for many years, Warren Buffett said, "I'm leaving a big foundation when I die." And he said, "Because I'm growing my capital so quickly that by leaving it in my portfolio, I'll leave so much more." And Bill Gates made the argument with him, "Yes, but what's the value of a life saved today versus a life only saved 30 years from now when you die?" And some things aren't financial calculations. So the point that you're making is there's a lot of value to being philanthropic, both with your time and your money earlier on and not just later on. And I think one of the things that is really important is many entrepreneurs have a lot more than money. They have skills and insights and contacts that they can lever philanthropically. So I do believe in being as active as possible Climate is my number one issue. And so I'm involved in climate, both politically, philanthropically, and in the way I invest. And that's given me a lot of feeling, at least, of I'm doing as much as I can.

Good. Well, last two questions. First, the interesting thing about this, your business, Tiger 21, is from an outside, it seems like the vast majority of the value is your like 8 or 10 person or 15 person, your group, which means I would think that there's a lot of pressure— or not pressure, but there's a lot of faith that the facilitator— like, you need that facilitator to be good. And if your facilitator stinks, then that could potentially ruin the experience, which almost is like your business is almost decentralized. Or like, you know, different customers will have drastically different experiences potentially regardless of what's happening at HQ. How are you— how do you make sure your facilitators are good and are providing a valuable experience?

Well, the answer is obvious on that one, I think. Which is what? Multiple. I mean, it's like you don't want, you don't want, you don't want all your— you don't want one big-ass customer. You would—

it'd be nice to have 100 Exactly. But the fact is, if you have 300 gas stations that have all the same label on them, the same name, you have a brand exposure that if something bad happens in one of them, it could affect people's demand for the other. So our only asset is our people, both our team, our chairs that facilitate the groups, and our members. And we spend, we have like a private university. Spend fortunes of time screening the facilitators and then providing lots of opportunities for the facilitators to learn from one another. Our facilitators come in from all— we call them chairs of the groups. They come in from all over the world to learn best practices from each other, and we track all of the relevant metrics to see which groups are performing well which groups are not performing well. And of course, the most important thing is that we have zero tolerance for anything less than high integrity and maintenance of confidence. If somebody, if a member or a chair ever violated that, they would be out in a second. So I'd say that maybe besides the core asset being our team and our members, the thing we protect the most is our brand by being really true to what it stands for. And I don't think we've ever compromised on trying to put members first. That's kind of what we're about. I'm a member first. Most of the value that I've gotten out of being a member of Tiger has been being a member. The fact that I've owned today, a little more than half the business is almost irrelevant to the value that I've gotten by being a member and all the opportunities that I share with all the other members that come my way as a member.

Well, you're awesome. The reason I wanted to talk to you was because I've, uh, I know of Tiger. I've thought about joining. I've got friends that are part of it and I love the business model. My business was, was tangentially related, but not quite the same thing. We, it was community-based. And I hadn't read or seen too many interviews with you, and so I'm happy that we got to talk because, uh, I wanted to kind of explore this. But you're, you're, you're, uh, you're cool as hell. I appreciate you taking the time. This is awesome.

Thanks so much for having me.

It was a pleasure. If people want to— do you use Twitter or anything? People want to find you, you want to point them anywhere?

Um, I'm on LinkedIn. I don't use Twitter. I don't— I, I I don't use Facebook, but I'm available through LinkedIn. And it's kind of easy. It's michael.sonnenfeld@tiger21.com.

Hell yeah. Thank you, man. I appreciate it. Thank you.