0:00
I saw that Roger Federer was one of he's he's part of the the Billy athlete club.
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0:04
So there's like Roger Federer is?
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five athletes who have made a billion dollars.
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Tiger Woods, Floyd Mayweather, LeBron James, Ronaldo, and I think Michael Jordan, maybe Messi. So that might be six. I think it's five.
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Um and now Federer is in that club.
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The whole Adam Levine thing is ridiculous.
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It's just like is that in like the Santa's fake section of the newspaper as well?
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It's just like the most obvious like people are like acting like it's like a big deal.
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It's like dude, what do you expect? What look at the guy. Of course he cheats.
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I don't even know the story. Why did he cheat?
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I don't know cuz he's Like what what's the controversy?
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Like did he do something really crazy?
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I I only read the headlines.
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I think he just texted like texted or Instagrammed like his yoga trainer and said I want to roll around naked with you all day.
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And then he texted this other lady that says like you know, like he like said like hey, like I want to go out with you.
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Like I why are you so hot or something like that?
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And then later on weeks later he texts and says hey, my wife's pregnant and we're going to name the baby your name. Is that cool with you?
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Which is super freaking weird.
1:15
But I don't know if he did anything wrong like legally, but he's just you know, just doing what like guys with like body tats who live in LA do.
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You know, you just cheat.
1:29
Like you got He's got the face of a cheater, right? I mean it's obvious.
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At the bottom of your tattoo sleeve is just a place to put your number.
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It's like I wouldn't have got this sleeve as a married man if I wasn't trying to you know, play the game.
1:41
Dude, speaking of bros, I think I've just invented something.
1:42
I've been doing this for the past few weeks.
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I call it uh like fitness dip.
1:46
So you know how like you know, people dip like tobacco, they put like a stuff in their lip. Lately I yeah.
1:53
You know, like chewing tobacco, you put it in your lip.
1:56
I've heard of it, but you're the only guy I know who does it.
1:58
Yeah, just like a fat lip.
1:58
Lately, what I've been doing is just putting in Have you seen PBfit?
2:01
It's like powdered peanut butter.
2:05
Yeah, that stuff's great. I love it.
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Dude, I just get a like a tablespoon of it and I just stick it on the roof of my mouth and I'll just suck on it for like an hour and I just it's my fitness dip and it just keeps me like It's like a pacifier for you.
2:16
Yeah, it keeps you It's like chewing gum almost.
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Like, you know, you can't eat anything because you got that in the roof of your mouth and you're just sucking on it real slowly.
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That's my new fitness dip.
2:24
All right, so how do you get an idea like this?
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Like, I'm not saying it's a I'm not saying it's probably doesn't taste good or might be therapeutic or whatever, but why are you like, you know what?
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Something need to I need something on the top of my mouth. What can I do? What can I do? What can I do? PBfit powder.
2:36
All right, I'm going to like I've never even wanted to put anything on the top of my mouth.
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Nor have I just taken foods and be like, what if I stuck this here for an hour?
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Would that be better than just eating it?
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Because I go to the store and I just like look at all the products.
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I look at new stuff and it says to add water and I'm like, what if I don't?
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What if I just eat this as plain powder? And I did. a cause over here.
3:00
I don't know, I just tried it.
3:00
I did It was interesting to me. It It's Just add water?
3:03
Don't tell me what to do. It works. It's works. You should try it. I definitely will not.
3:14
Uh all right, so what do we got today? You got ideas?
3:17
Dude, I've got I've got a ton of stuff.
3:19
Let me We can start off with something One thing that's like, I don't know if this is actually interesting or not.
3:23
You tell me, but basically I'm reading this book called More Money Than God and it's about the history of hedge funds.
3:27
You know anything about hedge funds? Not not a lot. Tell me.
3:32
Yeah, well, you know, I'm only in the first half of the book, so I can't tell you much about how they operate now, but because you know, we're still in like the 1980s, but basically the guy who invented it was called a hedged fund and his name was Alfred Jones, Alfred Winslow Jones, A. W.
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Jones is what they called him.
3:48
And it's kind of interesting.
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He was a journalist for Fortune.
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You know, he was just a writer.
3:53
It's crazy that Fortune even existed back then.
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This was in like the 30s and 40s.
3:57
And for some reason for some reason hedged fund is so funny to me.
4:02
That's what it That's what it was called.
4:04
I know it's I know it's real, but for some reason it just seems like something we would just say wrong.
4:07
Trying to be smart but like yeah, I'm looking at investing in some hedged funds. Yeah.
4:13
And people be like, is he putting a D at the end of that?
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Or like you know, go out there, have fun, and break an egg.
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You know, just I can do it.
4:25
So it's called it was called a hedged fund and he was researching for an article stock pickers and he found this like small group of people that were doing like some slightly different stuff with hedge funds or with stock picking.
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And at the time, like basically rich people viewed Wall Street and a lot of like equity investing as just a way to preserve wealth, not really grow wealth. And this guy A. W.
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Jones, he was in his 40s, journalist, and he goes, "Oh, with these, you know, small group of people that I'm researching, this like mathematical formula stuff that they're doing is actually really really interesting."
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And so he raises I think $100,000 at the time.
4:59
And what he does is basically the kind of dumb way of explaining it is which is the only way I understand it is that he just like does a combination of longing going long on things with borrowing leverage.
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Meaning if he invests $80,000, he would borrow another $50,000.
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Now he's $130,000 into a stock.
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Then with the rest of his $100,000, he would buy shorts in such a combination where his upside was much higher and his downside was a little bit protected.
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And there was like some math behind it.
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And at the time, this was revolutionary.
5:26
But here's where things get actually really cool.
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That itself wasn't the revolutionary part.
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I mean, that was one part of it, but it wasn't the main thing.
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The really cool thing that he did, which wasn't done ever before, is he hired these young stock pickers and instead of just giving them a salary, he goes, "All right, you work for me.
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I've raised a million dollars.
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You get 50,000, you get 50,000, you get 50,000, you get 50,000.
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You can go and hire two people to work with you. You're your own group. You're your own group. You're your own group. And uh get after it.
5:54
Let's see what you can do.
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Uh the person who does least best or the person does worst, you guys are out.
5:58
And he created this like cutthroat culture of these people who were just getting after it.
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And he was the first person that made it so you they were only paid a percentage, so 20% of future upside.
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And at the time he did it because they that was that just means you're you're taxed more uh uh it was more beneficial for you.
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It wasn't income tax, it was a capital gains tax.
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And your tax benefits were like way greater.
6:23
But he told his folks, he goes, "Yes, the reason we're doing this is Phoenician sea captains used to keep a fifth of the profits of successful voyages."
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And that's like how he like He didn't say, "Psh, hey, it's uh just so we can for this tax thing."
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But he like he like justified this weird reason.
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But anyway, this team structure, that's what like changed everything.
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Prior to that, Wall Street, which is like this stodgy, sleepy place of like, "Look, we're just doing 80% stocks, 20% bonds, and we just let it sit there."
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But then he once he changed that incentive structure, everything changed.
6:54
And that kind of got me interested That that's kind of like been sitting with me because at the Hustle, we used to do this, too, where uh for our quotas for our sales people, we would say, you know, go out and get ad sales and you get a percentage of what you close.
7:06
But then they would close like dumb [ __ ] They would close like, for example, they're like, "Who cares if it's a porn company, if it's a weed company, if it's a shitty service?" Like it doesn't matter.
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And then we were like, "Well, actually, that's a good point.
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We need like inverse incentives.
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Like uh you know, do the readers like this?
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Is the click-through rate high? Do they renew?"
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And I couldn't figure out how to do that successfully.
7:25
I couldn't figure out because both all I thought I thought for sure the story was ending with "So then, I created a better system, and it worked beautifully."
7:34
You're like, "I I couldn't figure that [ __ ] out.
7:36
That's too co- Just like You know, like I thought so I would have bet anything that you were about to say, "So then we did this and pat on the back, I did a great job."
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cuz I'm so used to people doing that.
7:48
Like, you know, in tech, nobody says, "You know, we kind of hit this problem and we didn't solve it." We just didn't solve it.
7:55
You know, and nobody ever tells a story like that.
7:58
I love that you just told a story like that. That's amazing.
8:02
Well, I I So with my new business, I am trying to think, I'm like, "How do I solve this?"
8:05
You know, like, can I pay like 50% of the But there's like But I started researching different ways to solve this. And uh I don't know.
8:11
Have you had I'll tell you a few other examples, but have you had with like the Milk Road or with anything that you've done, have you had where you're like, "If I just change the incentives, this other thing changed."
8:21
Where So it's like the product isn't the revolutionary or interesting thing, it's like how you operate.
8:27
That's what's interesting. Yeah.
8:29
Um I don't think I have a great story personally off the top of my head.
8:33
Uh like we just did one where we needed to fill all the ads for like October or something like that or like what whatever some future month, and we were a little light, and it was like, "Ah, how do we get this up?"
8:44
And um and Ben was just like, "You know, if we just told our like, you know, salesperson, we'll give them an extra 10K if they can get this to if they can get us, you know, to to this fill rate, um I think they'll do it."
8:56
And and I was like, "Yeah, but like that's the same thing as their quota.
8:59
Like if if they just filled it, they would get that percentage."
9:02
He's like, "No, I think if we just say, 'I'll give you $10,000 on top of your quota if you could do this,' and I was like, "Okay, I guess that makes sense."
9:10
And uh instantly they like way overfilled it.
9:12
So and I was like, "Okay, I don't think you could do that all the time uh because like, you know, this got them, you know, to get off their ass and do something."
9:19
But uh but yeah, I I thought that was interesting.
9:22
So what's funny is you're right, that does work, and you can do it all the time.
9:26
So I was researching like incentives, and one of the There's a handful of ways to make it Basically, I think Charlie Munger or some one of the like rich smart guys said like, "You show me the incentives, I'm going to show you future results, or something like that.
9:38
And your incentives and I'll show you your outcomes.
9:41
And there are a few successful ways to like incentivize people.
9:44
And so, one of those ways, I was reading this McKinsey study, where they said you actually should give bonuses based on 105% performance, not just 90% performance.
9:54
And research shows that if you over-attain to in order to get a bonus, people tend to do that versus the other way around.
10:00
Another thing is you do um clawbacks.
10:03
So, you get 50% of a bonus up front, and if you don't achieve the goal that you said you're going to get done, then I'm going to do what's called the clawback, and I'm going to take that money from you.
10:15
So, you could do this with kids, where you say, "Hey, look, your allowance is $100 a week, or $100 a month.
10:19
I'm actually going to give you 50 now, and the other 50 when you do your chores.
10:23
But if you don't do your chores, you're giving me that 50 back."
10:25
And that loss aversion is actually performs better than if I just say I'm going to give you $100 at the end of the month if you do X, Y, and Z. Uh That's 100% right.
10:35
Um yeah, the I think loss aversion is what they what they call it.
10:39
But basically, it feels it feels worse to lose money you have than to not gain the same amount of money.
10:44
It should be the same thing, but it's it's definitely not the same thing.
10:48
And I had this when we did I did a deal once where we got a million-dollar signing bonus.
10:55
But it was contingent that if we if we left before a year, um then we wouldn't get the million dollars.
11:01
And I would personally I wouldn't get the million dollars if if I left before a year.
11:06
And um And I think if you had just told me, "Hey, do you want to stay for a year to get this million dollars?"
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I would've been like, "Well, you know, that sounds good, but there's other opportunities.
11:16
Maybe I could do it this other way."
11:18
But once they just put the money in my account, they're like, "That's there now. Go look at that." Okay, cool.
11:22
"If you leave early, you have to pay all that back."
11:24
And I was like, "Oh, man, I got to pay back a million dollars?"
11:27
And it just felt Even my brain knew exactly what was going on.
11:32
and like I just don't want to pay back a million dollars.
11:34
That sounds like that that would be horrible.
11:36
I'm just I'm definitely not doing that.
11:37
I'm not losing a million.
11:38
Whereas, if they had just said, "Hey, if you if you stay a little longer, you can get this extra bit."
11:44
I would have been like, "Ah, maybe I can go get that some other way."
11:45
And um and that's like kind of a crazy like psych like you know, psychological trip.
11:51
I knew what was going on, and it still felt real to me.
11:54
Well, and another interesting example then we can move on, but another interesting example that I was thinking about was for you know what's like a really [ __ ] up industry is private prisons.
12:01
Because you're incentivized by like how many beds you fill, you know?
12:06
And that's like, you know, doesn't align with what we want as a society.
12:08
And I'm like, "Well, what it should be is you're paid a little bit of money for how many beds you fill, but then if the inmate, you know, has a recidiv- if if they go back to prison inside the next four years outside of being released, you got to give me that money back.
12:21
And if they stay out, I'll give you the second half of your payment."
12:25
And I was just like I was thinking of all these different ways that uh cuz I was thinking about my business.
12:30
I'm like, "How can I change my incentives around in order to get a different outcome?"
12:34
And that was like a really good example.
12:37
Uh but it seems the problem with incentives is that A, it's like to change them, you have to be kind of bold and like kind of be the first to like really try something new.
12:47
And B, often times, it's not always straightforward.
12:50
Like did you achieve this or like tracking the results is actually like a huge task in itself, which is what we had at The Hustle.
12:57
I'm like, "I could do this, but like I got to build all this stuff to like track all this."
13:00
But anyway, I've I Yeah, because it's uh they call it second-order effects, basically.
13:05
Usually, the first thing you're trying to incentivize does happen.
13:06
It's the second thing that goes wrong.
13:08
Basically, it's uh yeah, you got your ads filled, but they filled it with certain types of content, which led to readers being upset, which led to churn, or whatever.
13:19
You like you have to predict what would be the uh the second-order effect that comes from some of this stuff.
13:23
There's a There's like a Farnam Street blog that that I read this one. cobra thing?
13:28
Yeah, like the cobra thing, yeah. Go ahead, talk.
13:30
of like incentives gone wrong.
13:30
I don't even remember the story at this point.
13:32
I just it was like in India right now like there's you know, the stereotype of like a guy playing like a horn or I don't know what it's called and like the cobra coming up and like dancing and it was like, "Well, why are there so many cobras in India?"
13:44
And apparently, I don't remember what year it was, but there there was a little bit of a cobra problem and they go, "Hey everyone, we're going to give you $50 for every dead cobra you bring it bring to us."
13:54
Thinking, "Great, we're going to have no more cobras and but in reality, uh the schemers were like, "Oh, let's breed cobras and kill them and bring them to you." So like, "Oh, nice. It's free money. This is awesome."
14:04
And that there was now an overpopulation problem of cobras.
14:07
I I actually I have no idea if that's a true story, but that's uh that's like one of the urban legends.
14:13
Yeah, that's one of those Malcolm Gladwell stories that just like becomes like known by everybody whether it's real or not.
14:18
Um Have you heard the one about uh him talking about David and Goliath? Yeah. That one's great.
14:24
Basically, the I'll summarize it in 10 seconds, which is basically like everyone talks about David and Goliath.
14:28
It's this underdog versus the big shot.
14:29
And they're like, "Oh no, turns out Goliath was like 8 ft tall because he had a pituitary gland problem, which means that he was like had low IQ, meaning he like was like, you know, like an idiot and he was like big, which means if you have that pituitary gland or that issue, you can't see.
14:46
And at the time, the Davids of the world were like shepherds and they had these slings, which is basically like they had a rifle.
14:51
So basically, uh this like lead BB that this guy had it was already deadly and he hit like a big guy who was stupid and blind.
14:59
So it's really not that like impressive. Yeah. David's a bully. Um all right.
15:07
So let me give you let me give you an idea.
15:10
Okay, so I need a name for this. Don't have a name.
15:13
Uh so working title here.
15:16
But I think that isn't it crazy that basically I said we're we both invest in startups now.
15:22
And um And I had this really one of one of the startups that I invested in is just doing absolutely amazing.
15:27
And I'm like, "Wow, that thing is going to make like our little investment we put 75k in."
15:32
I was like, "I think it's currently probably at like 4 or 5 million dollars value that 75k check."
15:39
And we're not like like that it can still run.
15:42
Like that thing can still double twice.
15:47
And you're not doing anything. I'm not doing anything.
15:48
And I was like, "And also, so that's kind of A just amazing."
15:51
And I'm like, "Oh, I'm excited.
15:52
Like the fund is going to have like uh like the first really really big winner."
15:57
Cuz we're only two year we're we're 2 years in.
15:58
And so, it's hard to know what's your what are going to be your big winners.
16:01
But I think that one's going to be one of the really big winners now.
16:03
It's it's it's looking like very very promising.
16:05
But the second part is I would have never guessed that that would be the one.
16:10
Um What can you say what it is?
16:14
Um No, I don't want to say which one it is yet.
16:17
Um cuz I don't know if they want me to say or whatever.
16:20
But basically, I looked back at literally that that the batch of that quarter I did 10 deals.
16:25
And of those 10, I would have said like, "Oh, this is probably like, you know, somewhere in the middle."
16:30
Uh I would not have guessed it's like the one that's the big winner.
16:33
And I thought, "Wow, that's crazy."
16:35
And I was like, "You know, it's pretty unfair that employees at tech companies don't have this sort of portfolio approach." And it got me thinking.
16:43
We you talked about Sarah's list Or the founders.
16:47
So, you talked about Sarah's list and how, you know, if you could pick one of these companies that's going to 4 or 5x over your 4-year period there, um you know, you can become a you know, a self-made millionaire without taking huge entrepreneurial risks.
17:01
But you got to pick right.
17:01
And so, that got me thinking like, "Why do you have to pick right?"
17:05
And so, I got two startup-related uh community ideas for you.
17:09
The first is By the way, the way that you're setting this up, it's like you know, doesn't Wouldn't that when you eat 4,000 calories a day, you get fat?
17:18
Why does it have to be that way? It doesn't.
17:23
What if ice cream had just had a bad rap? Yeah.
17:25
And what if I told you if you exhale while eating, it has no effect at all?
17:31
Yeah, it's like duh, yeah, okay, and?
17:34
The um all right, so my idea is basically this.
17:37
You take a job at a tech company, you get your portfolio of stock options, or sorry, you get your stock options.
17:43
You can then click a button and you can what you can pool it.
17:47
And you can pool it with other companies that are like like equally risk weighted.
17:52
So we basically create like a like a like a credit rating agency where we kind of rate stock options and we're like, all right, cool, like you're getting at at this price at this valuation, good, we know that. That's that's set.
18:04
And secondly, like there's a community like uh desirability to these options.
18:08
Like maybe everybody in the community really wants Stripe options cuz they're like, wow, Stripe is great, but I'm not working at Stripe right now, I'm working at the smaller startup that I think has high upside, but like I consider Stripe options to be triple A stock options.
18:20
And so you kind of get a valuation and then a trust of that valuation.
18:23
But you basically put your you put your stock in and you end up with let's call it 40% your stock and 60% becomes a blend of other stocks that you get to either pick or index into out of the startup community.
18:37
And so as a as an engineer or as a designer or who whoever you are, you're getting to be a part of you get de-risked a little bit out of just your one thing cuz maybe you got a crazy CEO, you got Adam Neumann, you thought WeWork was a good idea, now 3 years later your stock options are worthless, they're underwater.
18:55
And like, you know, that okay, cool, that's just how the game works, but does it have to be that way is my question.
19:00
And so um Sam, I have two questions for you.
19:03
How good of an idea on this on a scale of one to incredible?
19:07
And secondly, we need a name for this idea.
19:10
Uh we already know I'm not funny on the spot.
19:12
So, the name thing I'm I'm going to That's just I'm already going to swing it. Option share. Yeah.
19:18
It's already a swing and a miss.
19:18
I mean, I called my company The Hustle.
19:19
Like, I'm not even good at naming not on the spot.
19:23
Uh so, I mean, this podcast is called My First Million.
19:27
Like, we're not we're not exactly good at this.
19:29
Uh I told Sarah I want to name my our kid Buck.
19:32
And uh she she wasn't feeling it. Dude, it's so funny.
19:37
I had told my wife I'd said I'd been saying this since college that I wanted to name my kid Jumper.
19:44
And then even I was like, "That's a horrible name."
19:45
But, at some point I was committed cuz I had told like 12 people that I was doing this.
19:49
And those were like my 12 friends.
19:51
And it made no sense, but I like had to stick with it till my wife was like, "What are you What are you saying?
19:55
This is not even close to what's going to happen."
19:58
Yeah, I've suggested Biff and Buff and uh she's not into it.
20:05
I think These are like, you know in Batman comics where they like punch and it's like pow. It's like, "Biff." "Buck."
20:11
It's like the sound effect of of a cartoon punch.
20:15
I have a a feeling that first name Chuck, middle name Steak is not going to pass either, but but TBD.
20:24
So, I'm not good at naming anything.
20:25
But, yeah, I mean, if you could pull this off Dude, one thing that I learned when I was running my company was I thought like, "Oh, it's a privately held business.
20:31
I can do whatever I want with the shares."
20:33
Like, I could just You could get a share. You get a share. I can give this to you.
20:35
I didn't realize that it's like it's not I guess it's I don't know if it would technically be considered regulated, but there's like rules, right?
20:42
Like, you can't For example, if I give if I sell you a share for a dollar, I can't then 6 months later and I'm like summarizing this, which means I'm probably a little bit off.
20:51
I can't then go and give like another employee that same share for 50 cents.
20:54
You know, that's I guess I don't know if that'd be considered illegal or just against like certain rules that where you can get in trouble, but it's like you can't do whatever you want.
21:02
So, yeah, if you could But, if you could figure out how to like operationally pull this off, I think it's badass.
21:09
Well, there are like secondary markets where you actually sell them, but I think this would have to be some you'd have to create some some, you know, financial contract, some some some derivative product that basically says I pledge or assign my shares to this portfolio, basically.
21:23
And then in exchange in exchange I receive shares of the portfolio.
21:28
And there has to be some sort of like consequence for trying to like, you know, renege or whatever.
21:31
Let's say your startup hits it huge.
21:32
You're like don't want to do that.
21:35
So, I don't know what the you know, I'm going to wave my hands in the air right now.
21:39
That what I'm doing right now is legal financial magic.
21:44
Like, all right, it's done.
21:44
That's done now, and now we just need to like, you know, start the company and have it take off.
21:50
Yeah, I mean, it's what what I don't By the way, that's how I actually run my businesses.
21:53
I'll go talk to the lawyer or the accountant.
21:54
I'll be like, I don't know.
21:56
We don't have the We don't We don't know what the contract says.
21:58
Like, you know, you got it. You got this.
21:59
I'm just giving them good vibes.
22:03
And I'm like, hey, I already agreed to this deal.
22:05
You got to figure out how that works.
22:08
Like, they're like, what?
22:11
Why didn't you just talk to me first?
22:13
There's like this leadership principle that you're supposed to like give people autonomy and like let them figure out and empower them.
22:17
And I always just see it.
22:19
I'm like, you're so like You're empowered, dude.
22:22
I'm empowering you to figure this out. You're welcome. Yeah.
22:27
The autonomy I'm giving you.
22:28
Your ass just got empowered, my friend. Congratulations. Yeah, you're welcome. Thank me later. this makes you happier. Study show.
22:43
Yeah, I mean, if you could figure that out, I think I'm down.
22:46
I just empowered your ass.
22:51
Yeah, I just empowered your ass. Classic. Yeah, you like that? You like that? Suck on that, Harvard. So sorry.
23:01
Speak of like investing, I was reading about the Figma thing.
23:06
So Figma is like the design thing that just sold for 20 billion.
23:10
So have you heard of O'Reilly Media?
23:13
Yeah, they they publish like books and the conference, right?
23:15
Like Yeah, basically what's the guy's name who started I had dinner with him one time. What's his first name? Tim O'Reilly? Tim O'Reilly.
23:21
So he's like they call him like he had this title like the Oracle of Silicon Valley cuz he's been in the game since like the 70s and 80s and originally started writing books on programming and his mission statement for his company was actually really cool.
23:34
It was like work on interesting stuff with interesting people and he's like we'll try books for a little while and then he's like oh we'll just let's just stick with books. That's fine.
23:41
But like he didn't actually necessarily care about books.
23:43
He just wanted to like fund his ability to work on cool stuff.
23:45
So anyway, they're famous for writing these books.
23:49
Now they make like two or 300 million dollars a year with a combination of books, conferences and like you can pay like 50 bucks a month and like get access to like a bunch of their like technical content.
24:00
So it's content for engineers and [ __ ] like that.
24:02
Anyway, they started a little fund using the profits of their business and the profits of their business were was big but the fund wasn't necessarily big compared to like a a full-time, you know, proper fund fund.
24:14
And I was looking at some of the stuff that they did and they were in Figma's seed round.
24:21
And I was doing some math and this doesn't account for dilution and if they sold early.
24:25
So these numbers actually could potentially be off by a by a lot.
24:29
But assuming that isn't the case, if they if I don't know what Figma's Figma's seed round was but I think they raised $3 million.
24:36
So if you assume that it was around a $15 million cap, it sold for 20 billion.
24:41
That means it went up by around 1,300 times.
24:43
So a $250,000 check is something like $300 million and it's crazy that this is one of those examples where the main thing didn't even make the main money. You know what I mean?
24:57
Like the Or sorry, the main the not main thing made more than the main thing.
25:05
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25:05
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25:07
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25:14
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25:16
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25:21
Dude, there I mean there's so many examples of that that actually leads me to another topic I had, but like the Remember that when we did Camp MFM, we stayed in a house and I don't know if you saw it, but did you see on the stairway up to the guest bedroom those plaques on the wall?
25:36
Did you walk to that staircase like the back staircase by any chance?
25:40
Yeah, I thought they were just like kids trophies, like basketball trophies.
25:42
I didn't even look at them.
25:46
No, they were adult trophies.
25:46
Basically, what those were So, the guy whose house we were staying at, he's a venture capitalist. Oh.
25:53
And he's just a venture capitalist who lives in North Carolina.
25:54
And that on that stairway up, I was walking up there and I was like wait, Beyond Meat?
26:00
And it's basically what he was framing was a share certificate.
26:05
It's like this guy, whatever his name was, owns, you know, 45,000 shares priced at point 01 you know, a dollar like basically one cent a share.
26:16
And then it's like Beyond Meat going public at $11 a share.
26:18
And I was like, wait, I just like literally took out the calculator app.
26:22
And you know how it doesn't go up to a billion or whatever? I was like, oh my god. Like this is insane.
26:27
You got to turn the phone. Oh, really?
26:29
If you turn the phone, it gets Yeah, that's a fun little fact. Wow. Game changer.
26:32
I've been just like you know Same.
26:35
I'm like, what does E10 mean? Exactly.
26:40
That's my That's my goal, not to be a billionaire to get an E in my net worth. Yeah.
26:46
The um the the But the guy basically had like 20 of these on his wall and they were just like, yep, issued shares at 22 cents a share, now going public at $22 a share.
26:57
And I'm like, wow, that's like you know, these are crazy run-ups, and it's like, okay, you know, 10,000 shares, 20,000 shares, 1 5,000 shares, 50,000 shares.
27:04
And you just do the math, you're like, this is staggering amount of money that's being generated by this.
27:08
It is really mind-boggling when you get these investments right, and it is also really funny how some of the really successful people made their wealth not out of the main thing that they did, but in a way out of the main thing that they did.
27:21
Tim Ferriss is another example.
27:22
Somebody was asking me the other day, they go, how much do you think Tim Ferriss makes a year?
27:25
And I said, I have you know, I don't know.
27:27
I don't think Probably he maximizes like No. what he can do.
27:31
Like he doesn't sell out, you know, fully.
27:32
Like he just like to 10 million bucks.
27:35
Yeah, I said I That's exactly I said five to five to eight million dollars a year probably of just like cash flow at this point from, you know, podcast, sponsorships, newsletter, whatever.
27:45
But book royalties, something like that.
27:48
I said, maybe five million dollars a year.
27:50
They're like, oh, okay, that's that's really good, but you know, I guess that's not that big.
27:53
I go, yeah, but like he also because he was Tim Ferriss got to invest in Shopify and Uber, and like probably made hundreds of millions of dollars off of his Uber investment.
28:03
Over 100 million dollars is my guess.
28:04
I would bet that he's net worth is north of 150, maybe north of 200 liquid.
28:12
Yeah, which is I mean, insane.
28:12
And obviously like what that means is that 90 plus percent of it probably has come from not his Well, if you describe yourself, he might say, I'm an author, I'm a self-experimenter, I'm a podcaster.
28:28
But then all his money came from like, you know, four angel investments or whatever.
28:31
And I think that's really, really That's like really, really impressive, but also more common than you'd think.
28:39
Do you know other people who had this?
28:40
Otherwise, I have a example that I want to go into anyway.
28:42
Yeah, just like a few famous people.
28:44
Just like you see like like Nas the rapper like on all these cap tables.
28:48
Like, yeah, you you know the guy who started Figma?
28:50
In one of the articles, it said that he had made $10 million because he owned the most expensive crypto one of those like big ones.
28:59
And he bought it for nothing and he sold it and he had $10 million before he even sold Figma.
29:02
But what are the other ones?
29:05
Well, I wanted to do I was thinking about okay, who do I do as billy of the week?
29:09
And so my billy of the week that I came up with was Roger Federer, the tennis player. $1 million isn't cool. You know what's cool? A billion dollars.
29:26
So the US Open was on, got me thinking about tennis and and I saw that Roger Federer was one of he's he's part of the the billy athlete club.
29:35
So there's like Roger Federer is?
29:38
five athletes who have made a billion dollars.
29:41
Tiger Woods, Floyd Mayweather, LeBron James, Ronaldo, and I think Michael Jordan, maybe Messi. So that might be six. I think it's five.
29:52
Um and now Federer's in that club.
29:55
Did he give him like a $300 million bump though cuz he married Brooklyn Decker?
30:00
No, I that's not even included.
30:00
That's that's just bonus points.
30:02
Um so how does this work?
30:05
So he he has the same thing where okay, he's had a great career, right?
30:09
Considered I think the goat in terms of tennis tennis players.
30:12
So he's the greatest tennis player of all time, but less than basically 90% of his money came not from winning tennis tournaments.
30:20
So he he's made 130-ish million dollars from official prize money from tournaments.
30:27
Um and he's got 20 grand slam wins, but most of the money he makes is off the court.
30:31
So just for example, like Is he retired?
30:34
Yeah, so Roger Federer who just announced literally yesterday that he's retiring, you know, in his last year he made like I don't know 300,000 in prize money, but 90 million from sponsorships off off the court off the court, which is kind of insane.
30:45
But, his story is kind of cool.
30:46
Like, and when I was studying these different athletes, I'm actually going to do a whole episode that's just a deep dive on each of these athletes, the moves that they made that made this happen.
30:56
So, one of Federer's big moves was that early on, he was not getting paid jack [ __ ] Even when he was the best player, um they you know, they would pay like Andy Roddick more because they're like, "Oh, Andy Roddick, he's American.
31:08
America's a bigger market. Federer's Swiss.
31:11
Uh the Swiss market, you know, that's a tiny population.
31:13
He's kind of this like clean-cut sort of boring guy.
31:17
He doesn't have this big personality.
31:17
Um and even though he's really good, he's not as marketable. He's not as sellable."
31:21
And this is what they used to tell him.
31:22
So, he was getting like very small like Nike was paying Andy Roddick more than they were paying Roger Federer, even though By the way, that's the guy who was number one.
31:29
That's the guy who married Brooklyn Decker. Oh, yeah, yeah.
31:32
Andy Roddick, that's right. Damn, missed that one.
31:35
So, uh so anyway, so Federer goes and he's like he's making So, he's making like very little money from Nike.
31:40
Then, he, you know, he carries on and he goes and he gets to a $10 million uh a year deal with Nike.
31:47
And it's sort of like, well, you made it, you know, you should be happy.
31:50
You got this $10 million a year deal. You know, you're set.
31:53
Your your family's set, whatever.
31:56
But, he made two decisions, which I really one decision led to two things that made him an extra $600 million.
32:01
And here's what those two were.
32:03
So, the first is his contract with Nike is coming up.
32:09
And the expectation is that he's going to uh just renew with Nike.
32:10
He goes to Nike, he says, "Hey, This is now or then? This back then.
32:15
He's like, "I'm one of the you know, I'm one of the best uh tennis players in the world.
32:18
Like, you know, what can you do for me?"
32:19
And they're like, "Raj, we we we put so much marketing behind you.
32:25
Uh you know, the reality is you can't compare yourself to basketball players or to uh or to um uh soccer players.
32:33
Like, you know, tennis is just a different thing.
32:34
Here's the best we could do."
32:36
And they gave him a deal, and the deal was basically like every year that you're playing you get X amount of money.
32:41
And he's and you know, something similar to what he was making right then.
32:45
But he starts he decides, you know what? I'm going to pause here.
32:48
I'm not just going to take this deal.
32:49
I'm going to go shop around a little bit more and see what I can do.
32:53
And then Uniqlo comes at him with this huge crazy offer.
32:55
And so Uniqlo, who's not even in the like sports apparel game really, but they kind of had this like tennis vibe to the they're trying to come they're trying to come to the west.
33:05
And um And so Uniqlo comes out of it and they offer him a 10-year deal worth $300 million that that pays him even when he retires. So this is 2018. He's retired now.
33:15
Um I think he's retired now. Let check that.
33:17
But he he is retired now, right guys?
33:19
Um but basically he uh he signs this deal knowing that he will retire during this deal.
33:23
And he's going to get paid $30 million a year uh doing this. He goes back to Nike.
33:27
He tells Nike, "Hey guys, I got this offer.
33:31
Can you also give me an offer like this?
33:32
It doesn't even have to be as much."
33:32
And they're like uh "No, we'll we'll throw in this like, you know, here's an extra free t-shirt, but you know, no, you're not getting a new deal." Give you a parking spot. like, "All right."
33:42
He leaves, but there's one key thing that he kind of knew here, which was that Uniqlo doesn't make shoes.
33:47
And so he signs the Uniqlo deal.
33:47
He starts wearing Uniqlo.
33:50
But he's still wearing Nike shoes.
33:51
And they ask him at the press conference, they're like, "Roger, uh I noticed you're still wearing your Nikes.
33:55
Like, are you allowed to do He's like, "Oh yeah, I don't have a deal with them.
33:58
Um you know, I'm shopping around.
34:01
Let's see what's out there for me.
34:03
Uh you know, it's exciting.
34:05
I want to see see what's out there."
34:06
And so for 3 years he keeps wearing Nikes essentially for free because he's just playing in them.
34:10
He doesn't have a shoe deal.
34:13
And then finally he gets he does a shoe deal with the brand called On Running, which I'm guessing you know about On, the the running brand.
34:19
They're they're also a Swiss company.
34:21
Yeah, they're they they they've kind of taken the world by storm.
34:23
And you know, what's funny is they were one of our advertisers when we first started.
34:25
And they started spending a little bit of money, and their spend kept going up each year.
34:30
And I was like, "You guys are killing it, aren't you?" And they are.
34:32
I think they make like over a billion in revenue now, or maybe they even sold. Did they sell? No, they went public. So, so they went public.
34:40
At its peak, it was like $11 billion valuation.
34:42
Now, with the with the market correction, it's back closer to $6 billion.
34:44
Uh but at the you know, at its peak, so Roger owned 3% of the brand in exchange for He did an equity deal.
34:51
So, he said, "All right, I get it.
34:53
You guys don't have the same cash these guys can offer.
34:54
How about a piece of the company?"
34:57
And so, he owns 3% of the company.
34:57
At its peak, his stake is worth $300 million now.
35:01
So, that's sort of like bet on yourself, and then do an equity deal.
35:06
Don't don't trade dollars for time, you know, trade your brand for shares.
35:08
Trade it for equity, and that becomes worth $300 million.
35:12
And then, he says, "All right, what else can I do?"
35:14
So, he then takes matters into his own hands.
35:16
He cuts ties with his current representation company, starts his own player management firm to represent him and other players.
35:25
Then he starts creating his own tournaments.
35:26
He's got his own like, you know, cup that's basically like, you know, the equivalent of the Ryder Cup in golf, where it's like Europe versus America.
35:32
Uh so, he wants to do the same thing.
35:34
And so, now he's got his own competition thing.
35:36
And so, he's built this whole empire, made over a billion dollars total, most of it, 90% of it, off the court.
35:42
And I think this is kind of amazing.
35:44
And if you look at it, um there's a couple like like interesting things here.
35:48
So, he um he goes up market.
35:51
So, he goes basically like, "How do I go premium?"
35:54
So, his sponsors are Mercedes-Benz, Rolex, Lindt chocolate.
35:59
He didn't do what Jordan did, which was Coca-Cola and McDonald's, right?
36:03
Cuz he's like, "All right, where's my niche? Where's my market? How do I get paid?
36:07
Let me go to these like, you know, go to Rolex, basically."
36:09
Um the second thing that he did was he um he uh he basically not only did he bet on himself, not only did he take matters into his own hands, he played a very patient game.
36:21
And so, I think most people would have been So, those 3 years where they don't have a shoe deal, they'd just be counting the dollars that they're missing out on.
36:28
I could I make 5 million or 10 million dollars a year if I just sign this contract.
36:31
And this is a common trait.
36:34
There's this great LeBron James story where LeBron is 18 years old.
36:38
He graduates from high school.
36:38
That same day, you know, the day the first day he's legally allowed to, um Nike shows up uh Nike or Reebok.
36:43
I think Reebok shows up at his uh um at his school or whatever.
36:49
They take him to a meeting.
36:51
He's like, and I remember, dude, this is like the longest table I've ever sat at.
36:54
Like the longest boardroom table.
36:56
He's sitting at one end, I'm sitting at the other end.
36:57
And he's like, he slides a check over to me.
37:03
And I look at it, it's more money than I've ever seen in my life.
37:04
And LeBron comes from like single mom, she had him at 16, you know, couldn't pay electricity bills type of thing.
37:09
Like came from like he was dirt poor.
37:13
And they basically offered him a 10 million dollar a year contract as a 18-year-old kid.
37:16
He hasn't played a single game in the NBA yet.
37:20
And he looks at it and they're like, you sign this now and you can become our signature athlete.
37:22
We will put this money behind you.
37:23
It's the biggest deal that we've ever offered to a kid kid out of high school.
37:26
You know, congratulations, son.
37:29
And he doesn't have a he doesn't have an agent.
37:31
He doesn't have anything at this point.
37:33
And he basically just says, you know, appreciate the offer, man. Like I appreciate it. Thank you.
37:39
Um let me get back to you.
37:39
They're like, get back to you?
37:40
This is 10 million dollars a year. What are you thinking?
37:43
And he's like, And he's like he tells the story later.
37:46
He's like, in my head I'm thinking, man, this is more money than I've ever seen.
37:49
But if Reebok's offering me this much, I wonder what Nike will offer me.
37:51
I wonder what these other like he's like, I must be worth something to these guys.
37:54
Like I don't have to take this deal yet.
37:55
And just by being patient, he ended up with a much larger deal out of that.
37:59
Just for not like immediately grabbing the check.
38:03
So, you know what trait that's called?
38:04
It's called um there's this awesome book by this woman named Angela Duckworth called Grit.
38:09
Have you ever heard that book, Grit?
38:12
I've seen like Silicon Valley people talk about it. I don't know that. Yeah.
38:14
Well, it's like centered around this story.
38:16
It's like a study where they give a whole bunch of kids uh they sit them down at a table and they go, "Hey, look, you can have one marshmallow now or in a couple hours I'll give you two.
38:26
But uh I'm going to set this here.
38:28
I'm going to go out of the room for a little while and handle some stuff.
38:30
When I come back, I'll see if you decided to eat it or leave it there and uh that will kind of tell me what decision you made. Sound good?"
38:35
And they leave and you know, they just see who does what.
38:39
And they measure these kids for like 30 and 50 years, like for years and years.
38:43
And what they found is there's a correlation between traditional financial success, you know, like our traditional word of success, there was a correlation between how successful they were and the children that chose to not eat that one in exchange for getting two in the future.
38:56
And the ones who put it off, you know, and ate two, they were more successful.
39:00
And what you've explained to me is like the perfect like real world but rare example of uh grit, where it's like, "No, I'm willing to like not do this thing now in exchange for a better alternative in potentially in the future."
39:12
And that that's that's the Delayed gratification.
39:14
Yes, delayed gratification.
39:14
And that's like the best way to describe that.
39:18
I'm a marshmallow eater, dude. Same.
39:20
I I would have been that first you know, I would have had it in my mouth while they're explaining the instructions. I'm like, "What?"
39:28
There's another one coming?
39:30
Well, I always got like frustrated when I talked about like, you know, I told you this, when I talked about Warren Buffett and Jeff Bezos talking about patience and having fun.
39:36
I'm like, "Dog, you're way too old. Go have fun now."
39:40
Like there is no there is no long there is no long-term, man.
39:42
Your long-term is like Jeff Bezos now.
39:44
He's like, you know, he's rushing, you know, he's you know, seeking gap He's turning into a frat boy.
39:52
He's like he's like he wants to be single, do roids, you know, drink beers out of boat.
39:56
And it's like all right, it's cool, but like not as cool when you're How old is Jeff Bezos?
40:03
Not as cool when you're 57 as it was when you were younger. know, man. It looks like it works.
40:06
It looked like it it looks like it's working for him.
40:09
Uh let me tell you about this thing I read right before we started.
40:13
So basically today, I think today, they're going to announce the Fed's what their uh rate raise is going to be.
40:20
Yeah, we're going to we're going to learn how much money we've lost today. Yes.
40:22
And I don't know anything about that type of stuff, so I'm not going to pretend I do.
40:25
But I I read this interesting article and it was about JP Morgan.
40:29
You know, JP Morgan's this like, you know, amazing bank that's supposed to know what they're talking about.
40:33
And I was reading about what their predictions were and they had this like day of scenario where they're like, here's like the three options.
40:41
Or here's the three possible outcomes and you know, they raise the rate by this much, this much, and this much.
40:44
And here's our prediction on what's going to happen.
40:47
And they weren't like being funny.
40:50
They weren't obviously they weren't being funny.
40:51
They weren't trying to be like silly or anything.
40:52
But I'm going to tell you the the range of the three options.
40:56
So um option one was well, I'll just say like so what's going to happen is if they raise it by .
41:02
75, we are potentially going to have a 5% drop.
41:09
Uh sorry, if it's a full percent for full percentage point raise, we're going to have a 5% drop in the market. Or if it's a .
41:15
75% raise, we're going to have one of the best days on record for the S&P 500.
41:21
So that's basically this like the the most like one of the most prestigious banks on earth with thousands of people studying this.
41:28
They say it's either going to be the best day ever or a 5% drop, which is not quite the worst day ever, but it's a really bad day.
41:37
And it just goes to prove that even the quote experts, they don't know [ __ ] We're all just floating on this rock trying to figure it out.
41:44
But I saw this and I was like, wait, are you kidding me?
41:47
Is this a serious Is this a serious prediction?
41:49
It's going to be one of the best days ever or one of the worst days ever or something in between.
41:53
That's basically what their prediction is.
41:56
It reminds me of these people where you're like, all right, so you know, what do you think of the chances that it happens?
42:00
They're like, well, it's a 50/50, man.
42:01
It could It's either going to happen or it's not going to happen.
42:04
It's like, no, like just cuz there's only two options doesn't make it a 50/50.
42:07
Like it's either going to be or it's not going to be. It's all 50/50.
42:14
"Tomorrow the statement analyst is going to be like, well, you know, I saw that going one of two ways, but I did not expect it going that other way."
42:21
And the funny thing is it's like they release like an 82-page report and it just like, "I don't know, man." At the end.
42:27
Yeah, it just trails off. But who the hell knows? Not really.
42:31
"M and M, not much, you."
42:31
That's just what the whole report should be because that's basically what they just said.
42:36
Like, "What's your opinion?" "Not much, you."
42:39
It it I thought that was ridiculous.
42:40
That's That's J- So, I was reading about all these hedge funds and I'm like, "Oh, these guys are smart."
42:44
But turns out like when I was reading about these hedge funds, these guys are smart, but they're like kind of lucky.
42:50
Like they like just make a bunch of guesses. hedge funds.
42:56
Dude, this guy um This is a hedged opinion, by the way.
43:00
This is the most hedged opinion I've ever seen in my life.
43:04
The um it's like one time I was playing roulette and I was uh so down on my luck at the casino.
43:09
By the time I get to the roulette table, that means I have like I got bored of poker, then I lost money in 5 minutes playing blackjack, and then I had like an absolute roller coaster at the craps table, and now roulette is my like come down.
43:20
My My gambling addicts out there will know what I'm talking about.
43:23
And then at some point I'm like just betting wrong every time.
43:26
Like, "What are the odds of me being wrong on red or black 12 times in a row?"
43:30
And then I'm just betting both red and black just to feel a little bit of a win.
43:34
And it's like, you know, I'm just hoping a green doesn't show up.
43:37
Uh but basically like there's a a tweet that I saw that goes "Yeah, I never realized my whole net worth was dependent on an interest rate." Like It's so true.
43:47
It's like, "Dude, until this year, did you know what the FOMC committee was?
43:52
Did you Did you know that like your entire net worth was dependent on 0.
43:57
75 or 1% interest rate hikes?"
43:57
Like Who the Where the [ __ ] did this come from?
44:03
And why did it turn out that they could just No, I remember they could just rag doll my my net worth.
44:08
I remember uh people talking about the Fed and I was like, I don't know what the Fed is.
44:10
It's like It's like when people say they were talking about the FBI, TO BE HONEST. THAT'S THE FED.
44:17
OF like Breaking Bad and Narcos. I had no idea.
44:20
Like, you know how like people say like, "Well, you know, scientists say or you know, they say this."
44:24
I That's what I thought the Feds was. It was just they.
44:25
You know, there's he, him, her, now there's they.
44:27
You know, I just thought it was the pro- the official pronoun they.
44:32
My pronouns are they and Fed.
44:36
Dude, I saw a guy on Twitter and he put for his pronouns he put we-dash-damn-boys.
44:43
Dude, that's It's the best one. It's the best one. It's that guy Jack. Jack R. Raiders. Read 'em boys.
44:47
That was his uh pronouns. good.
44:52
Yeah, that one always make me laugh.
44:52
Um all right, I have something interesting.
44:56
Uh so, in I found this video on on YouTube.
44:59
If you Google on YouTube like Figma seed pitch.
45:01
So, I watched that this morning, dude.
45:06
Awesome, let's talk about it because basically the story is I believe it was in This video was filmed I think in 2013.
45:13
So, the video The video was posted in 2020, but the way looking at it, he looks pretty young.
45:18
Maybe not 2013 young, but he looks young.
45:20
But, regardless, he's going through his pitch.
45:23
And basically, so Figma uh recap sold this week on Monday or Friday or something like that for $20 million, one of the biggest exits ever for a venture-backed startup.
45:32
Uh and the guy who ran it started the business when he was 19.
45:37
And there's this video on YouTube of him pitching this guy named Daniel Gross, who was actually on our pod early on, who had a fund.
45:42
And I had a few takeaways from this pitch.
45:45
And so, it's like a 20-year 18-minute or 10-minute video of him pitching.
45:49
My five takeaways were A, he's a kid.
45:51
He Even if it Even the video was like new, he looks like he looks like he's 18.
45:56
But, and he looks so young and he talks kind of young, but he's really wise.
46:00
Like, you could you you hear him speaking and you're like it's very impressive hearing him talk.
46:06
The second is that the pitch was basically videos of the product.
46:08
It was a prototype, like a demo of the prototype, not as much of a deck.
46:12
And often times throughout the pitch, it was pretty fun and he like used the product to Photoshop the guy he was pitching, Daniel.
46:21
He Photoshopped his face and made it he made him look like another person.
46:24
And Daniel, the guy being pitched, was like, "Oh my god, this is hilarious. This is awesome."
46:28
And Dylan, the guy was just like having fun and showing him the product and that was so much better than just showing a deck.
46:37
And the last two things were tech skills.
46:39
So, the guy is like clearly technical.
46:41
And we often talk about how like it does you don't need this stuff.
46:45
And technically, you don't need it. But god damn it helps.
46:47
This guy he clearly like they built something that like was actually working and that's such an advantage.
46:53
I do think you need to learn that.
46:55
And the last thing is that it's an MVP.
46:56
It does not look good at all.
46:58
It it's pretty ugly and it's and and it's mildly effective, but it's effective enough that you can see the future. Yeah, exactly. I watched this thing.
47:08
Um so, you can find it if you go to YouTube, it says it's uh his name Dylan Field pitches seed stage Figma to Daniel Gross.
47:15
That's the name of the the YouTube video.
47:16
It's got uh what, 30,000 views now, I think.
47:20
But I bet you probably all of it's the last 2 days. Yeah. Yeah, yeah, yeah.
47:24
So, he's pitching and my observation is very much like yours.
47:27
First of all, it doesn't look doesn't feel like a pitch because uh most pitches are like "Hey, here's our company.
47:36
Um we're going after this really big market.
47:38
Did you know we have a TAM of, you know, $3 trillion a year are spell spent on health care."
47:45
And they're like, "Oh wow, okay.
47:45
Um $3 trillion, that's cool. So, what are you doing?"
47:49
And they're like, you know, uh you know, we like We sell weed.
47:54
Yeah, like we help you we help you do squats with using your phone camera like with better form and it's like I don't think that's the three trillion dollars of health care spend but okay yeah like I'm not sure what the what the right answer is.
48:06
have like a a stupid quadrant thing with them in the top right. Right.
48:10
Everybody else, you know, the the the Y axis is if you're you know stupid or smart and then this one is if you're hard working or or lazy.
48:17
Like everybody else is lazy and dumb and we're hard working and smart.
48:22
this twenty billion dollar company, are you sure you're better than them?
48:26
I think they're Yeah they're like you know poor product.
48:30
It's like I don't know about that. You're a poor product. It makes me mad. It makes me laugh.
48:39
I get like very irritated.
48:41
And what they should do is put themselves in the bottom left and be like, "But one day this we could We can move we're going to move ourselves up the graph.
48:51
weeks ago when we met and then now we've moved up and like just imagine the trajectory and like that's actually That's actually what's happening.
48:59
We've already moved an inch on this screen.
49:01
Imagine if you give us five years.
49:04
It's not to scale but So so he's doing this pitch and basically literally the first slide is a picture of him on a boat.
49:13
Here's me I'm on a boat and I used to work at Flipboard.
49:16
Twice he goes I worked at Flipboard twice.
49:20
And then he goes this is my co-founder he was my friend at school we dropped out okay he goes then he shows this video this talk he goes I was really inspired by this talk by Bret Victor inventing on principle.
49:30
By the way this same talk I think is the one that the Webflow guy said was like his inspiration for building Webflow was the same grainy ass video of this guy explaining you know like how to build like a like a real product.
49:42
Well I think that I think the takeaway from the talk is he said something in the talk about how uh it's morally right to help people to create or something like that where he's like, your goal as a business builder is just help people create or something like that.
49:56
And so the Webflow guy, like the the demo he's doing in this is like the difference between like imagine you have to you have to choose a bunch of options from a menu or write a bunch of code and then push run and see how it happens versus just you see the thing and you can just edit it live.
50:09
Like drag and drop like it's a what you see is what you get editor.
50:11
And how much more creative you can be when you're doing it the what you see is what you get version because you're just shuffling things around in real time.
50:19
I think everybody's kind of experienced this in general.
50:23
Um so anyways, he he gives this talk and he gives a bunch of demos.
50:25
And all the demos are like kind of uh it's like, oh look, I you know, I made this like airplane look at blends with the background.
50:31
And then like look I did this thing.
50:32
Like I I merged these two people's faces together.
50:36
It's like, you don't look at this and you don't think uh $20 billion company someday.
50:39
Like it's not like you'd have to have a lot of foresight.
50:43
Really what you see when you see this is like the only two indicators that this would be successful is this guy seems really smart and really like he's a creative builder.
50:50
So like I'd bet on him and to be successful in life for sure.
50:55
And then the second thing was and this is I think the underrated part of what people talk about for Figma, which is that there was a technology change.
51:01
There was an inflection in technology, which was WebGL had come out.
51:05
And I remember when WebGL first came out, there were a bunch of these demos.
51:10
I mean I I'm not technical enough to explain it, but basically what it made what it did was it let you do cool graphics stuff in the browser that you weren't going to be able to do unless you otherwise normally like you normally a browser was weak.
51:20
And if you wanted to like play a game with cool graphics, you needed to like download the game.
51:24
You needed to have the application of the game to run on your computer's hardware cuz doing it in the browser was going to be too laggy, too slow, too whatever.
51:33
And WebGL was this like web framework that let people build things that were like they were like cool graphicky stuff, 3D stuff, like, you know, real-time stuff in the browser.
51:42
So that's why when Figma you would see people if I'm working on the document with you, I'd see your mouse moving around in real time.
51:48
And that was like a magic trick.
51:50
You'd never seen that before.
51:51
And at the time I remember with like we were building stuff and when WebGL came out all of our developers really intrigued by it.
51:57
There was like cool stuff you could do in WebGL that you weren't other like wasn't possible before.
52:03
And then the the question was now what's the application?
52:05
And then he where he landed was like, I think we can recreate the whole creative Adobe Creative Suite in the browser.
52:11
And here's how we're going to do it.
52:12
And like that actually made a lot of sense.
52:14
He didn't actually pitch it that well.
52:16
He like mentioned those things during the thing, but like you'd have to like ignore 80% of what he said and just be like, oh, that's just fun experimentation. This guy smart.
52:25
WebGL is a game-changing technology and this idea of recreating the Adobe Suite in a browser, making it free for everybody, that's a great idea.
52:33
And so like you had to sort of see the the the great pitch through the forest here.
52:37
Dude, so the remember how I told you about this guy named Brett Adcock who's like this billionaire guy who created a bunch of different companies including basically a flying car business. Remember that guy? Yeah.
52:48
So, he tweeted out the other day like here's what I've learned about entrepreneurship and one of the five things that he said was pick really, really big ideas because then you could attract more investors and it's easier to like uh um get employees and all that and all that type of thing.
53:04
It's like that make no small plans thing.
53:06
And that thing has always made me self-conscious because like every plan I make is like pretty small.
53:12
Like like, you know, I won't one Mars all right now, not two later. You know what I mean? Like Yeah.
53:18
I only make small plans compared to like that plan.
53:20
And it's kind of cool that like this Figma thing it doesn't seem that grand.
53:26
It was, but it doesn't seem that way early on and that like makes me feel better about my deficiencies. So, thank you, Dylan.
53:33
You You know what I mean when people say like grand ideas and I'm like yeah, but like writing a newsletter's kind of fun. Right. what I'm saying?
53:42
Like I don't I don't know how to make robots.
53:46
Yeah, but I do dream about that sometimes. I'm like, okay. Me, too.
53:50
In an alternate life, what am I doing right now?
53:51
And I'm like, why am I not, you know, changing whatever, you know, building the the next big thing, you know, the next Pixar or making a flying, you know, car or whatever.
54:00
And it's like, I could do it.
54:02
I could I know that I could do it.
54:04
And and I do think about doing it.
54:06
Maybe I will end up doing it.
54:08
But but it is for some reason for me, I sort of I'm like, uh I don't know.
54:16
There's a how hard do I want to work Yeah. uh question. Right?
54:20
Like, you know, if I made my quadrants, I'm putting myself in the lazy quadrant where I'm like, I don't need to do the hardest thing to impress myself.
54:29
So, I'm trying to figure out the things that I can do that impress myself um that are also like not going to ruin my life and my lifestyle.
54:39
Dude, well, but I what I mean by that is just like, I like being home with my kids.
54:41
I like that I don't have to like freak out.
54:42
I don't I they don't have like a a office of a hundred employees that are like, we're hard charging and we're about to die at all times.
54:49
Like, I kind of like that I don't do that.
54:51
Um so, I just need to find a way to impress myself that fits in my framework.
54:55
And I think that What about Roger Federer?
54:59
Like, who's doing his [ __ ] You know, Roger Federer, I was going to ask you that.
55:02
Like, who's doing his stuff?
55:02
We had Mark Lore on the podcast and I talked to a bunch of people who worked with him and they're like, yeah, he's really good at raising money and then he hires people and then he just kind of like they didn't it's exaggerating to say he chills. That's not true.
55:12
But like, they they kind of like said like, well, he wasn't doing the hard work.
55:15
He did a lot of the work early on, but he kind of like got all the leverage by getting the money and having the idea and starting it and then like everyone else he did a really good job of hiring them and letting them do their thing.
55:26
So, but same with Roger Federer.
55:27
He ain't the one running that running a lot of that stuff.
55:30
I wonder how he partners with people.
55:32
Yeah, well, the other one that I was looking at was Floyd Mayweather.
55:34
And Floyd Mayweather has kind of an amazing uh bet on himself story like this, too.
55:40
Like you probably know it, but I don't know if most people know.
55:44
Boxers in general UFC fighters make basically nothing.
55:48
And um with like, you know, one or two exceptions.
55:50
And then boxers kind of make more.
55:53
Boxers can make, you know, 10 million, 20 million in a fight.
55:55
And they can do that once or twice a year. That's great.
55:59
That seemed like the top.
56:01
And what Floyd Mayweather did was he was like, "Who the hell is making all this money?"
56:05
Cuz I see that crowd is full of people.
56:08
And the pay-per-view number is huge, but like where does the money go?
56:10
And the reality was that the money would go to the promoters.
56:13
It would go to the cable companies.
56:14
It would go to all these other people.
56:16
The And so he decided to bet on himself.
56:18
So he buys out his contract.
56:21
He spent He takes $750,000 out of pocket and buys himself out of Top Rank, which was the promoter that promoted Oscar De La Hoya and Manny Pacquiao, all these guys.
56:31
And he starts, you know, Mayweather Promotions.
56:34
And now his business model is like basically it's it's vertical integration, right?
56:38
Like it's to use the business school term.
56:39
He's like, "Okay, I'm not just going to be the talent.
56:43
I'm also going to be the production for the show.
56:45
Which means that I also collect the live gate revenue.
56:47
Which means that I also have to pay the other fighter.
56:49
Like I have to I have to write the check.
56:51
Um I'm also going to own a piece of the pay-per-view.
56:54
I'm going to make a He's like, "I'm going to make money on every hot dog sold in this venue.
56:57
I'm going to make money on the merch.
56:59
I'm going to make money everywhere."
57:00
And so because of that, now when he does a fight, like his um Manny Pacquiao fight, his Conor McGregor fight, he's pulling in somewhere between 250 and 400 million dollars. That's crazy.
57:12
Himself on those fight per fight.
57:12
So he, you know, more than 10x, more like 20x what he could make by betting on himself and building that brand.
57:19
And then then he created all the associated brands.
57:21
So then he basically created He's like, "Why am I These sponsors are paying me to wear their [ __ ] You know, why don't I just create, you know, the Money Team clothing line?
57:29
And I'm going to like own my own clothing line rather than promoting these other clothing lines.
57:34
LeBron did the same thing.
57:34
He's like, "Why am I promoting McDonald's?"
57:38
He bought equity in Blaze Pizza and is like, "Cool, I'll just own a piece of this chain rather than just be a sponsored athlete."
57:44
Um and so there's there's basically a bunch of a bunch of people who do this model.
57:47
And then Floyd, you know, he did a he did a couple things.
57:49
One was he went nuts on the self-branding.
57:51
So, he changed his brand from Pretty Boy Floyd to Floyd Money Mayweather.
57:57
And he knew that people were going to hate that.
58:00
He knew that people were going to hate it and he started doing hateable things.
58:02
Like he would just post a photo of himself like at a dinner table, but there's no food on the table.
58:05
It's just stacks of cash everywhere.
58:07
He's like, "This is how I eat." or whatever, right?
58:11
Or, you know, he would um you know, just go throw like a you know, a wad of cash at somebody and just like make fun of them because they're poor.
58:17
And like they would pick up the dollars cuz they're like, "Well, this is like 10 grand."
58:20
And so like he would do things that would get attention.
58:22
He would do things that would build his brand, but in reality he would look like this party like this party guy. He owned strip clubs. Never smoked. Never drank.
58:28
You know, like the guy trains at like 3:00 in the morning.
58:33
So, you know, he kind of built this brand like he's this kind of like badass or whatever.
58:37
But in reality he's like a he's like a extremely well-conditioned athlete that was like extremely disciplined and never like ran into any of those problems. But he hired Al Haymon.
58:48
Who Al had run You know who Al Haymon is?
58:51
he he's like We have to do a whole episode on on this because Al Haymon's really intriguing.
58:54
Al Haymon, if you Google his face, there's like four pictures of him on the internet.
58:58
And he's one of these guys I think he's like famous for like you never meet him in person, but he does everything on the phone and he's always in the background of the most powerful boxers and fighters in the world.
59:09
And before that, you know what he was doing? No.
59:11
He was doing the same thing in the music industry.
59:12
So, he represented Janet Jackson, Whitney Houston, helped build their brands and their their whole business empires.
59:17
Then he taught Floyd how the music how musicians make their money and he's like, "Oh, I need to do that.
59:23
Basically, my fight is me on tour. I need to own the tour."
59:26
And so I need to own the shows.
59:28
I need to make the money from the tickets, not just be the fighter who goes on the stage.
59:31
And so Al became his business guy on that side and then he has Leonard Ellerbe who does it on the on the Mayweather promotion side.
59:40
And like the joke of course about Floyd is that he can't read.
59:42
And it's like he's like I can't read but I I know numbers.
59:45
And like you know so he's like you know he know he know he's found a way to make a ton of money.
59:51
He understood like the core fundamentals of of business.
59:56
And knew how to put put people in place.
59:57
So he generates a lot of money.
59:57
Now some people think he's going broke cuz he spends so much. I think he might be. I totally believe that. hard to say.
1:00:04
Dude, I I totally believe that.
1:00:04
This podcast we we are the internet dork renaissance.
1:00:07
We started with Adam Levine cheating on his wife and then I think we went to like uh the history of hedge funds. RSU option shares.
1:00:21
Yeah and then RSUs option shares.
1:00:21
Then we talked about the Fed and JP Morgan.
1:00:25
And then back to Mayweather and Al Haymon.
1:00:27
You can't get this anywhere else. You you just can't.
1:00:31
Where are you going to get all this? Yeah yeah.
1:00:32
You know We we are the Chinese buffet of podcast.
1:00:37
They say that like true wealth is created by being like a narrow an inch inch wide but like a mile deep. Not here.
1:00:45
We are we are we are a a rain puddle.
1:00:47
We are just going to cover everything just a little bit.
1:00:50
Well you built your whole life off being 4 inches long.
1:00:52
So it all worked out for you at the end.
1:00:58
And then you get the comedy at the end of the show. And you get the comedy.
1:01:03
Average at best in in lots of different If you're average at best at just about everything you're kind of above average so it works out well. All right. That's that's the show. I'm exhausted.
1:01:15
I got to take a nap nap after that. Mhm.