I don't think I have ever successfully gotten an investor on board who I have reached out to First not you know necessarily sending a bunch of cold emails to investors but maybe putting yourself in a position where they will see you is generally the way I found to
be successful raising Capital your users especially in the consumer business they're not all coming with the same background with the same needs you have to kind of choose which company you want to build Do you want to build for the expert the intermediate the beginner
because if you're building for both sides you're going to build a product that is for no one if you want to like have a perfect record you won't have a record at all because you won't have made any mistakes and therefore you will have done nothing just do it just try
and see if anyone cares well hello everyone it's Jim oami with another infinite Loops I have a very special guest today disclaimer I am an investor in his company so I might not Grill him to the extent that I often Grill others actually Jay I'll probably
Grill you more just to show no favoritism at all my guest is Jay Reno the co-founder of pointtown which helps you earn and redeem credit card points for free fls I know and knew nothing about this when Jay convinced me that oh there's a huge Arbitrage opportunity
available here but more importantly Jay you're also a multi multi-time founder you're success successfully exiting Etc you also are an investor you lead uh seed and series a Investments for 645 Ventures and so if you don't mind my
first question is be we got a lot of younger people who aspired to be entrepreneurs and I love one of your lines you you knew you were an entrepreneur all of your life and your your first thing was on eBay but if we if you don't mind we're going to start
with a lot of young people want to be Founders they they have great ideas they have you know great skills but they never get there as a as a coach player what advice would you give on how to actually take the idea and get it funded and move to an actual thing like point
out that is a really really cool idea and first welcome well yeah thank you first uh Jim for having me on your podcast um big fan of of yours uh and of of the podcast um yeah I mean I think uh I think first really the the reality is a lot of people end up getting tripped
up on just getting started it's funny ideas are a dime of a dime a dozen why because we all have generally good to great ideas um but what sets I guess an entrepreneur apart from just the average person is we actually just take action on the thing we care about now because
we take action does that mean that it's going to be successful 100% of the time absolutely not no I mean the reality is like I have tried false started and failed at a variety of different things um in my life uh in you know in my career but but the reality is you just
you just need to take that first step or those first few steps to to see if your thing has any legs um I don't think we talk about this enough uh in in public um the news certainly doesn't talk about this uh because they really only want to
report on the things that either are spectacular successes or spectacular failure something that's going to be interesting it's not interesting to uh to most people to hear oh well I actually I tried starting a food delivery company in
2020 uh that you know I just like put a website together and saw if anyone gave a [ __ ] and it turns out no one gave a [ __ ] so I closed the thing down right like who knew about that thing probably nobody um you know maybe a few of our customers did of course but but yeah I
guess just to the to answer your question really um getting started just making those first few steps is weirdly the thing that holds most people back I've I've found yeah and I I work with a lot of younger people who are really interested
in being Founders and that seems to be the number one thing the number one thing is the fear of making a mistake in public right and and like I I I went so far as to actually write a a piece called mistakes were made and yes by me um and I've never met a really really
successful founder uh or really anyone in life who had not made huge mistakes and and I always try to guide the people I'm chatting with to the understanding that listen novel mistakes are the most learning Rich environment that you can find yourself in and if you if you want
to like have a perfect uh record you won't have a record at all because you won't have made any mistakes and therefore you will have done nothing what what advice to you give for getting over that hump when you're talking to younger people yeah old let's not let's
not make it an age issue yeah yeah yeah older people have you know by definition had to have failed more times than younger people right I mean you've been around longer to to have more successes and failures uh yeah I mean for me like
that first that first company um I poured probably 80% of my savings though you know wasn't that big at the time into this company you know goes to zero my savings at that point were you know a little above zero um and what was a better learning experience than than um
than trying running failing at a company I learned more than I could have ever imagined um at the time right because those things become much more ingrained in your psyche when you realize okay don't do that thing again or definitely
do that thing again because it was very it was very good um you take that with you to the next step uh or the next company or the next product or job or whatever it is that you want to do um those things become much more ingrained um so like I guess the first the first
thing I would suggest is again there's like it's really more of a mental barrier that people have um around getting started or doing something like you said failing in public feels very uncomfortable I think the reality though is your thing is
probably not going to become very public uh for the first year that you're doing it two years right like even with Point Hound we've been around for a bit over a year and I would say we are still not like a a company that everyone has heard of yet um and so if this company tries
and fails you know even after we've raised some capital and have gotten to you know tens of thousands of users uh most people aren't going to aren't going to look at me and be like oh shoot you you started and you failed this thing so um
backing up I guess like the the first thing you can do to get started is just commit to yourself that you want to do the thing and you want to try and you want to put your effort into it getting over that hump is the that that mental hump is the biggest obstacle
that find um because the fear of failure in public is so strong and real uh again the reality though for those taking those first steps no one cares like no one cares like you do no one's looking at your thing or you like you are no one is as self-critical like you know you
walk around in public being like am I having a bad hair day or whatever and no one is looking at your hair no one cares like how's how's my how's my dress like is my shirt on right like no one's looking at that no one cares um but you you are hyper aware so I think
like having some level of awareness of these like psychological you know situations you're in um is is a helpful way to just try and put some of that aside knowing that we're human and are going to be so self-critical I was very lucky I had a mother and when I was a teenager I was
not immune from I mean especially when you're a teenager teer that hyper awareness of how other people perceive you and the you know it's this hat screwing up my Hair Etc and my mom would always say when I was like obsessing over some little thing she'd look at me
and she'd say ah it's nothing a man on a galloping horse would notice yeah or even just anyone who's like staring at you for 15 seconds which most people don't do anyway you know right they're look at the thing where you're like oh no I have a zit you know
whatever like they're not no one's no one's hyper aware of you like you are so and putting that aside is uh is probably the the like working through that working through that is the best way to get started aside from just like actually incorporating a company or
actually trying to design or mock up the first thing yourself even if it's complete dog [ __ ] like just just do it just try um and see if anyone cares that's that's that's the step one that I think people get hung up on is they think they need to go out and raise a
million dollars and hire three engineers and a designer and whatever in order to make the thing but you there are a lot of ways you can build a minimum violent product or an MVP without having to uh you know raise a bunch of money or um
have it be perfect on on day one and you've been successful with white combinator do you think that for firsttime Founders taking that route is preferable to like trying to raise the money in a in a direct to the investor type uh model and I'm by investor I mean
you know seeking out BCS and and try to build it that way vers the the Y accommodator model I would say yes I think so two two items there um raising money from investors I don't think I have ever successfully got an investor on board who I have reached out to first um and
I've spoken to hundreds and hundreds of investors over mine more than that I don't know over my over my lifetime and it's always the ones that come to you who are already interested in you for some reason or interested in your company for some reason that that get
over the hump of whatever their fears are about the company and realizing that this could go really well um so I would I would generally say that um putting yourself out um to attract interest in a variety of different ways uh where
you're not you know necessarily sending a bunch of cold emails to investors but uh maybe putting yourself in a position where they will see you is is a is generally the the way I found to be successful at raising Capital now that could be through an accelerator program
like Y combinator where um you know you have this this three-month period uh of working together with a bunch of other companies and your group partners and really figuring out what the core problem is that you're solving how to address that with a product and see if
you can get your first few users or customers or whatever um and then when you finish that program or programs like it um yeah you have these demo days that attract people to want to come and see what you're working on well why comment being a very good example of that you
have thousands of people who are looking at that who are generally investors either Angel Investors or Venture capitalists looking in on your thing and while Jim may look at um you know a company doing ai ai for SAS like whatever that is like Jim may
be like that's not interesting to me but Jim might be like okay this company that is addressing a problem I have or something that I know about this is really interesting to me I'm going to go pursue that that that company um that's where you'll have a lot more success
than just kind of you know cold emailing or cold reaching out to to folks that also just brings up an uh interesting follow-up question you you've identified you know the biggest hump is just getting started for the uh entrepreneur what has been your
experience in identifying in investors that are going to be great to have on the cap table and investors who you would actually really not want to have on the cap table Yeah well earm muffs Jim you can't hear this okay no yeah you've got your ear muffs
on hopefully those things S no actually um the reality is for most Founders um anyone who believes in your company who will write you a check is someone you should probably take money from in the earliest days at your earliest stages um as you start to uh have the ability to
be more Discerning whether that's because you've been a Founder who's had an exit or your company is growing like wildfire already and people know that and think it's a great company or product or you seem really great whatever um things start to change and
you can you can you know choose your investors more uh than than uh in other situations so that I mean that being said what I always look for and the most important thing uh in my last company where we raised a SE series a series B um and talk to a lot of different folks
it was really the human behind the the fund fund names don't tend to matter very much um unless what you need is the pr of that brand fund name to help you drive sales of your core product now if you are a B2B SAS company having seoa in your cap table is really nice because
other startup Founders know who seoa is as an example uh if you're in a building a consumer business no consumer knows or gives a [ __ ] who seoa is right like the one of the better VC firms just using them as an example could be anyone else
um no one gives a [ __ ] so really what matters at the end of the day is is is actually not the name of the fund um it's really the human who you would be working with on a day-to-day week toe month-to-month basis um that I've found to be what matters most
now um you know having a having a network um that they can intro you to uh is kind of table Stakes for most investors like all right I can provide you value well at the end of the day as an investor were we I'm an inv too you're selling you're selling money
right hi I have money will you buy my money it's like sounds like such a weird thing but that's that's the reality of what's happening is you're like my money is different than his money is different than her money um so yeah in the end
like who you are is what differentiates you more than what you can do from for people usually and I think people get generally tripped up over the fund name or the investors's name because they've invested in Google or Uber or whatever um and therefore if they invested in you
that means you're going to be the next Google or Uber that that's not how it's not how it works so again ultimately like the human behind the money is what I care most about and so this is why I wanted you to eou I didn't mean to praise you on your own podcast but like
you know we had offers for other from other funds and decided to work with oan Adventures because of the humans behind the firm and not the like brand name you know um so I think uh as an investor yeah you got to you got to bring your your your best self to the
table um and your honest self and people people will notice that well I uh being as susceptible to flattery is anyone else uh Jay I thank you for that but no doubt we will uh Crush those uh those excellent Expectations by really [ __ ] something
up in the future you well you've got you've got a you've got a strike or two so let so go ahead use it exactly now let's let's let's get into what intrigued me uh about Co town like that was a world I knew nothing about I I knew zero about it but I had an
unusual situation in that my daughter Kate knows everything about how to do she is like a magician right and in fact when we were considering po Hound she was my go-to and it helps that she is married to uh one of my senior guys on our Venture team Chris Denny Brown but
like she picked everything apart she pointed out like this might not work this might not work but then the list was much longer for every wow this is really cool but she said something interesting to me and she said I just hope this doesn't ruin it for those of
us who actually know how to use these Point systems I I I are you are you hearing that from anyone else or is that unique for my daughter yeah no um I I think I'll give a quick overview of what points are and um and and address the question which is
how would we if Point Hound is extremely successful does this ruin the points game for everybody else um so first of all what is the points game or what are points you know probably everyone has heard of credit card points uh most people have a credit card um and if you
don't you're probably thinking about getting one or if you have one you're probably thinking about getting another one um the best way to earn credit card points is by swiping your card uh and earning points you know in multipliers that you get from swiping
credit cards so if you have an MX gold it gives you 4X points on groceries and restaurants when you spend at gr uh grocery stores or restaurants um whereas if you spent that MX gold card at a you know an online store buying a shirt you would only get one X Point while there's
card that might give you 2x points for online shopping right so there's this whole kind of world around earning points um and making sure you have the right credit card so that you're earning points Point how helps you do that part um on the other side is once once people
accumulate points uh they they end up which a lot of people have they have maybe 50 100 150 200,000 points just kind of sitting in their Chase account or their MX account or their cap One account um and once you have those points there are a variety of ways for
you to redeem those points you could turn those points into uh statement credit let's say you had 100,000 points you could turn 100,000 points into about 600 to $700 of statement credit that's nice you could turn those 100,000 points into gift cards worth about
$750 to $900 okay that's fine that's not bad um or you could use those points inside of the the the bank's travel portal so if you're an amx's travel portal your 100,000 points would be worth $1,000 for flights booked through the the travel
portal oh that sounds even better than all the other ones right well if you were to take those points and transfer those points to a an airline um and book literally the exact same flight with an airline you may be able to get $8,000 to $155,000 worth of value out of those
100,000 points which of course is a lot more than $1,000 dollar worth of value by using them inside of the travel portal so people like your daughter Kate have figured this out um and said wait why don't I just find a flight with an airline where I can transfer my points
from the credit card to the airline and book with that Airline sounds kind of sounds somewhat straightforward right um I would say about 1% of the population has figured this out or 1% of the American population anyway has figured this out
and of course by Simple Math that would mean 99% of people have not figured this out yet so what we're trying to do with Point Hound is make it extremely easy for people to get free free flights for free by transferring your points from your credit card issuer to an airline
and helping you facilitate that whole process and we built a um a search engine that searches 150 different airlines and Returns the results um in points uh so you don't have to try and go on every single Airline and see how much something's going to cost it's kind
of like Google flights but for points now hopefully you're still with me here uh but what what Kate is saying is Well if the whole 99% of other people well let's say even 10% of people were to move over and actually figure out how
this works what happens to the to the industry as a whole does it break it the reality is no why is that well the airlines are pretty tied to the government in a lot of different ways they used to be government run organizations like back in the 60s and 70s
these airlines are you know like government funded uh now they're private companies but during the pandemic we found out that the government literally stepped in to keep the airlines alive because no one was allowed to travel and as it turns out airlines are treated a
lot like Banks now um so the too big to fail Banks there's actually like you imagine if Delta or United or American went under like the government actually won't allow that so in this points game the reason why this is the case is because Airlines
right now are flying planes at a significant loss and they make a significant amount of profit by issuing points and credit cards to their customers so if you have a Southwest card or an American Airlines card and you're swiping that all the time because you're earning points
you're actually propping up in the airline and making the airline profitable while flying the planes which is what airlines are supposed to do is extremely unprofitable for them so this industry can't actually change if we if we start extracting value and
helping the the average user get more value out of their points it's going to slowly devalue the value of the airlines program um um points programs but what's going to happen is they're just going to change the pricing and the structure of the points a little
bit over time so this this this game won't go away the Dynamics will change in that Airlines will release more award availability to be booked with points and that additional award availability may be slightly higher in price slightly
lower in price but ultimately kind of the way you can think about booking flights with points is it's kind of like an outlet store so there might be like the the Nike store on Broadway in SoHo and you're paying top dollar if you walk in the the Nike store to buy your Nike
basketball shoes um Nike also has outlets all over the country where you can go to a strip mall in like Topeka Kansas and buy that same shoe for 50% off at the outlets well that's what Airline points uh is for is to put butts and seats um at a at a substantially
discounted rate because they're flying planes quarter full half full three quarters full and want to actually fill the plane so there's still a lot of room to go for them to the airlines to optimize um filling planes and utilizing the planes that they already have
through this point system that the 10% 20% 30% influx of people using points for Airlines is actually going to help everyone in the end the thing that attracted me to your company and you is I saw you as somebody who really was able to see Arbitrage
opportunities and then more importantly take advantage of them and and the second question I had is that you know in finance right if there is a uh if there is a purely mathematical anomaly for example you used to be able to buy a Royal Dutch I think it was which was
co-listed on the New York Stock Exchange and on the London Stock Exchange and like one of the oldest arbitrages in the world was the prices were very different often and like so if it was selling at uh 10 bucks in London but selling at 12 bucks in New York you bought in London
and you sold in New York well as communication got faster that disappeared right because that was a pure mathematical uh anomaly that you could AR away and as you've just explained this is an Arbitrage opportunity but I think that it's much more difficult for the reasons
you just stated to Arbitrage it away and so it also leads me to the next question is why is it like everybody like joining Point Hound or joining other Arbitrage opportunities that entrepr entrepreneurs have identified that you can see will persist
even if people are taking advantage of it like why is is that is that a hard sale and if it is why is that the case yeah I think everything comes down to Consumer psychology in the end doing something new and novel presents another opportunity to fail for people it's uh
there are you know there are the early adopters in Tech who will just latch on to anything new and just try it because they love they love trying new technology or new new whatever it could be in retail people who love new shirts I know why I keep using shirts as the
example here today but here we go we'll just keep we'll go with it um there are people who love trying the new thing right and that's probably again like 1% sub 1% people who are those early adopters um it's then the mass Market who gets hung
up about doing things differently than they've done before because it is challenging to do things differently when most people are on a similar track um and know what they do like having to alter that track means I can't go out and have fun and at the with my jet ski
on the lake tomorrow I I'm thinking about doing something new where I'd rather just keep the blinders on this is what I've learned about consumer psychology and building my prior company feather which is a furniture rental business um and it makes renting your
furniture when you're in your 20s and 30s makes a lot of sense mentally and almost everyone who heard the idea was like wait instead of having to buy and sell my furniture I can just have it ordered delivered to my house or my new apartment it could stay there for a year
or two like me um and then get picked up and move away when I'm and I'm done I don't have to like deal with selling it for nothing or moving it or whatever the answer is yes um the core challenge with that business was changing Behavior changing consumer
behavior and even though it was a lot easier simpler and actually more cost effective for people to rent their Furniture versus buy it and try and sell it a lot of people were just like I love that idea but it's not for me you're like but you literally just
said all the reasons why it's perfect for you why is it not for you and they would be like yeah just uh you know sounds like sounds sounds tough like there's no good answer um they've just described why it makes sense for them so I think the same is true with a lot of
things that that try and change behavior for people um I would say poin Hound included um to some to some degree where people today are they might have a credit card or two and they're just you know happily swiping away on the card they have their Southwest Airlines card
that's just starting on Southwest points even though they're losing significant value like five to 10 times the value that they could be getting which would be like five to 10 times more economy or business class flights for free that
they could be getting uh five to 10 more vacation per year they wanted to they could take that time off work even like by just doing one thing differently which is instead of using this card you use these other two cards in place of
that card to earn lots of points or as a as another example taking the points that you're earning and transferring them to an airline to book with the airline directly or with one of their partner Airlines versus using those points inside of their their credit cards travel
portal to save them five to 10 times the value or to give them five to 10 times more value for their points so that's yeah it's a it's a it's a funny core challenge which is to just be able to teach people the the nuances and slowly pull them in the right
direction and that's generally what I've seen work best is to create those simple educ moments and to give them the carrot so that they they end up just kind of like realizing it themselves and doing something about it themselves versus just you know keeping the way keeping
things the way they're that they're used to yeah I've uh long studied our human operating system and one of the things that I've concluded is that we habituate virtually our entire life and getting away from a habit is I was rereading uh Nicola Tesla Tesla's uh autobiography
and he had concluded that he himself he he said I am an automaton meaning a robot right I I I I do everything because I'm programmed to do it that way and and so for me there's a universal unlock here that you're getting at if you can understand that and you can
understand that as weird as it sounds people will literally say yep no thanks yeah hey do you want 10 times the value on your money yep nope thank you I don't and and and people don't when I say that to people are like oh Jim you're
exaggerating that's crazy and I'm like no it is absolutely true and then I actually use you as one of my examples uh with like why isn't everyone doing this deal here and when they go through it they're like you mean that like this this is a hard to get people to sign up
and I'm like well he's doing a great job but like you would think that people would be falling all over themselves to maximize that benefit right we are not optimizers we we are much more comfortable doing what we've already done yes so so what did you learn from
feather where you also had to kind of break through those habituated uh ways that younger people were doing furniture that you were able to Port over to point out yeah that's a great question I think that's like the core insight as to why I'm one of the right
peoples to build this company is I've spent a lot of time understanding the consumer psyche right which is an absolutely irrational being it is an irrational being working with businesses on the other hand they're completely rational like you can they don't care
how something feels they're just they'll just do it if it saves them money or if it saves them time um time and money even whereas with the consumer again yes it takes it takes it takes tugging on their emotional strengths to get something so what I learned and what
we've applied at this new company is in order to get them to do this new thing you need to make them feel the value themselves and they need to they need to have it click themselves in whatever way they think so I'll give an example um we do
these one-on-one Point sessions with our users uh every day we have requests for like eight of them a day but I can't spend all my time talking to our users all day every day we've spoken to about 300 of them and I've given them um feedback and guidance on which cards to
get and then how to use points after that 30 minute session that I have with them they're in a much better place because they feel heard and understood and if you can make someone feel heard and understood then they are they are yours forever in a lot of ways happily
they're like okay I just needed to voice this to someone and they would literally just they just need to say it out loud something that they've read or seen on our website and they're like just tell me that I'm I'm good that I'm doing this
right and I'm like you are you you just follow the steps that we have on the website about how to transfer your points or whatever and they're like okay good I was just worried about doing it wrong and so rewarding people along the way um with these little like nuggets of
like you did it great is the reinforcer where they're like I did okay okay good all right was worried that I didn't do it right and therefore all of my money is gone you know like my bank account just closed and someone siphoned all my
money away it's like well that wouldn't happen but that's how we feel um so showing those little reward moments is extremely valuable and building specifically talking about like building a consumer business where you need to get someone to you know do a new
Behavior or have a new behavior um I'd say the other example is just like people uh you need to you need to get them um again have like you need to get them to have the the realization in the way that they think um so example of that is like people on our people on our site
often uh when I have sorry when I have our our Point session they come onto our Point sessions and they they just they might need to see something visually or they might need to hear something or they might need to read something in a certain way or they might need to
actually see that the uh like there is an actual flight um that does what we say it's going to do like they see the results and they're like wait the retail price of that flight is $5,000 but I could get it for 50,000 points like in my anx portal it says
it's 400,000 points I'm like and they're like but here it says 50 and we're like yeah we've been trying to tell you that all along but for some reason right now you're getting it and figuring out that like moment of of like their aha moment and and bottling that and bringing that
as as uh as early as possible in the user journey is critical to getting people to use your thing long term because they have that aha moment sooner and don't drop off before they actually get to the place where you might they might have that aha
moment yeah and uh you know I was a fan uh of the neural linguistic programming uh tribe that sprung up in the late uh 60s uh 70s and they make that point again again and again you have to learn how to communicate with people in their
preferred mode of communication and when you first read that you're like what what do you mean right and then they go on to say listen most people are visual communicators but there there are others like auditory kinesthetic you know way it makes you feel and then they would
say like saying to somebody who is an auditory uh listener or Communicator can't you see the big picture is they literally can't but they can hear the Bell right and and the kinesthetic types which are the smaller of the cohorts and the way people communicate and
understand things you know it's how it makes them feel right and so I I suspect also that the um the doing the thing that doesn't scale like doing these possessions scales in another way and that is are you creating ambassadors for Point Hound that go out and pral tized
like when I find something that is really cool like I will not show up about it to the point where like my friends will be all right stop is that the same experience that that the people who participate in the sessions have yeah 100 perc I mean they're they are
designed both for the user to have their questions answered in a 30- minute session and equally designed for us the company to one know what the hell people are worried about what their problems are where they get stuck right and for us to then create these loyal
ambassadors who are like I spoke with the founder or I I thought it was just going to be some Rando I was talking to but it was the person who you know one of the people who started the company and this was amazing like I now get it
did you know that I get it hey friends I get this I get it now I get this new thing and their friends are like what new thing and like you know you can fly you can get free flights for free and they're like free flights for free that sounds too good to be true I know that's
what I thought you know it's this and then they just kind of go off and uh and and tell other people so I mean we're seeing this in our data like we 3x our user base from July to August with no paid no paid advertising spend probably
because of I mean all word of mouth but I'm guessing a lot of it has to do with these hundreds and hundreds of sessions that we've given to people that are helping them find their AA moment in there in their hopefully in that 30 minute period or if not then then the
next time they're on our website and they've had their questions answered so yeah it's uh the human psychology is everything in building a consumer business it's it's uh it's it's wildly important to to understand that totally and uh it's something that
we did um when we developed a um way to customize portfolios called canvas at osam um we limited the early users to people that we knew would give us honest feedback right first number one and then I I one of the failings I found in in some entrepreneurs that I like admire
and everything but they don't quite get there is that they they are so committed to their their vision of the way this should work that it it's almost like they have shields up even if they don't intend to they might have shields up like to ideas that conflict with the way
they think it should be and so I always believed that I'm generally wrong right most of the time and so it it helps to interact with people who are actually using in our case canvas and your case point out and and one of the things we
found was Boy is that the right way to look at it because things that we thought were going to be the you know the Northstar for why everybody used it didn't even make the list of the people who were actually using it so at pointtown what have you learned from the
uh sessions with users that surprised you and then do you have a a a fast iteration cycle that incorporates that into into the platform yeah yeah absolutely I mean what you're what you're describing comes back to uh like as a Founder even we're human and we
want we don't want to change the way we're thinking about things either right because that would mean we were wrong and we are failing which yes you might you are wrong and you might be failing but like if you alter course it's possible that if you go over here now or
if you speak about something in a different way or you build the product a little bit differently to address your customer problems then you may not fail and you may actually be successful but it's very hard to do that because I want to be right I don't want to be wrong it hurts
and bring up the change piece like I don't want to change the path do you know what changing the path means that's a lot of work I'd rather just go down the path and going on and like if it doesn't work it doesn't work but you know at least I didn't try that other
thing and failed that other thing too because that might even be wrong you know I only failed at this one thing like think think about that so I mean yeah when we when we have these Point sessions at Point Hound the goal is to incorporate that feedback as
best we can now I will I will share some bookends so like if you take every single piece of feedback and you try and Implement every single piece of feedback you're going to be running around like a chicken with your head cut off because someone's gonna want
like I want to be able to filter your search in this way and some be like I want it to filter this way and you're like that is directly opposing each other but if you changed it you're like all right cool they wanted to filter that way we'll make it
for them and this other person's like we want to go like this okay great we'll make it like that then you're just you're all over the place but I think the the Nuance though is doing nothing is also bad right making no changes is bad making all the changes is bad so
somewhere in between is the is The Sweet Spot and that sweet spot is once you hear things multiple times over from a variety of different users in different use cases that's when you're like yeah we should probably change that thing maybe you've had a hunch about it too
and they confirm it or maybe you've heard it four times and you agree with them that's when you actually start to implement that feedback um I think the other really important piece there is is to mention that like user type because it your users are generally not
especially in the consumer business they're not they're not all coming with the same background with the same needs um and maybe points beginners or maybe their points experts and you can't you have to kind of choose which company you
want to build Do you want to build for the expert the intermediate the beginner because if you're building for both sides it's you're going to build a product that is for no one because the experts are like I want this extreme tooling and I want it to be able to I
want to do all these different things and The Beginner's like I don't know what a point is so like if you're talking to the expert like all right so here's what a point is they're like shut up get out of my face and if you're talking if you're talking to the
beginner and you're like but here's why you want to tweak and tune this thing here this how you should search they're like I I don't know why I should even not use my debit card you're like missing everything so you gotta gota just like focus
on a core user know who that user is too who's giving the feedback and then incorporate that based on what you are trying to build and who you're trying build for that is one of the incredible nuances that I have taken a long time to learn and I've only learned really at
this company event and what was what are a couple of the things that met that criteria right you heard them from different use cases you heard them from different style users what were a couple of the things that really surprised you like [ __ ] I'm I'm wrong and I can't
believe I'm wrong and I've got to change this yeah yeah we have this uh incredibly powerful Search tool on our site that allows a user to put in their home Airport and search A month's worth of flight inventory from that airport all in one like eightc search so
basically you can say I live in San Francisco show me all the places I could go and show me the cheapest points for all of the month of October or for this weekend in October or whatever but just show me all the results it's something
that Google fce doesn't have it's like a very kind of unique feature to surface the best deals to the top well once you get the results you get tons of results that then need to be like filtered down by um you know country you could be like all right I I want to or
continent I want to go to Europe so like let's get all this you know this this South America stuff out of here and this North America stuff out of here I just want to go to Europe um what a lot of people have told us is they want to be able to put in multiple Origins that's
not just your home airport but maybe they want to because they're home airport might be I'm just going to use Topeka Kansas again their their home airport might be Topeka Kansas and the results from Topeka Kansas are generally less interesting because there aren't
that many good direct flights and stuff from Topeka Kansas so maybe they want Chicago I don't know if that's the closest airport but let's just assume Chicago's uh the closest airport they might they might actually want to put in Topeka and Chicago and then search both
of those at the same time because their airport is uh is smaller and doesn't have as many good results that's one we've heard a bunch of feedback about where we're like that makes sense people want to use the tool beginners intermediates and experts are all kind
of saying this in unison where we're we're saying okay great let's let's figure out a way to to make that change um so that's one example another is uh roundtrip flights um in the points World searching one way is really the best way
to search for your flight because you may be there's really no such thing as like getting a discount from for doing a roundt trip flight like there is with cash fairs when people are buying a ticket um with cash which is how everyone uh buys their their flights
right so people are saying hey can I get a round trip like I want to be able to book this round trip and what we say is we could build that feature for you but but having that round trip functionality is actually not going to help you because you might not want to fly back
from the same airport that you flew into to get a really good deal on business class flight back to your home airport you may want to fly from a different airport in Europe where you took a little tiny plane to get to that and then you took the long haul flight in
business class all the way back or economy or whatever so these are these are some of those things where we've we've heard from a variety of different users types um hey this is what I want and in some cases the answer is yes that makes sense
we get it and multiple people are saying it across multiple user types and sometimes we hear okay here's how we should do this uh or here's what we want but we we have to figure out a way to say um yes we can build this for you but it might not be the most it might be the
most um useful feature for you right so that's that's kind of like those are a few examples and and and where you can get into the nuances of user feedback being extremely useful U but also not something you should just always be running after to fix right away yeah and
as I was listening to you I was I was thinking about um how you know the balance of for example like so the streamers the streamers okay the streamers have destroyed their ux to the point where I get like really pissed off when you know on HBO now for example not
just to pick on them I'm including all streamers here but the most recent irritation was with HBO or what they spent what $30 million to change their name to Max again just stupid anyway what my wife and I were rewatching a series on HBO and in the old days you could
pause it when you wanted to pause it and shut it down you're G to watch it again the next day right and you you'd go back to HBO and boy there it was you just hit play now what it does is it it they've turned into grifter Central they put you
back to the beginning of the series play it even though you're not watching it right so that they can Jin up the number and and this kind of stuff just drives me crazy same thing just to prove that I'm not a universal hater of HBO I'm not
like apple music they they they so destroyed their user interface as to almost make it unusable by like I had all of my music on Apple music then I switched everything to Spotify and because Apple music was just so [ __ ] up like why does that why does that happen and why
does that is it because Engineers who have super deep domain knowledge know that by changing it this particular way you could do that really one cool thing that no people like me either know or care about that one cool thing I think in this particular example
what came to mind for me was the you know publicly traded company might need to up their user numbers this quarter and they got that feedback from their CEO then the C then the senior Vice Executive Vice President then the senior vice president there's a game of
telephone that was like you ultimately need to we need to get these numbers up or or our stock goes down 20% you know and they're like oh [ __ ] okay well how can we game that you know not like how can we make the user experience great and not and organically attract more
people to it because it's good product but how can we juice the numbers or you know whatever and so you see you see products at scale how you know fall for that bait all the time um which I get on a short-term basis you're like happy we made you know we we increased our
subscriber count by 10% and now wall Street's happy with us but then you're like next quarter is gonna suck when we don't have that stupid lever to turn anymore you know I I have a feeling that there's a not even have a feeling you can see it like this is a lot of this is
going on behind the scenes and like how do you guard against that as a Founder right so let's just say we wave a magic W Jay and like you are you have millions of users and then your engineers come in and they're like hey Jay we can do this
really cool thing is it just are you the final line of defense there are you and your senior team the final line of defense I think it's ultimately making clear that you should be focused well should be I I I think looking at your business long term and thinking about
the long-term impacts of the decisions you make in the short term are or how you kind of get around a lot of this you know the heroin that is a growth a growth Trigger or a growth lever um you know if you're if you're building a venture-backed business and
you you know you need to show growth up and to the right I don't know which way that is for you on the screen but you need to show that right and so what what are the shortcuts you can take to grow your business up and to the up and to
the right so that you can get your next round of funding so that you don't die right that is happening at the Venture level um and if you saw this little thing where you're like well retention would be [ __ ] but we could drive a ton of traffic to our site if we just you
know Juiced the advertising budget and just drove a ton of people it's true you could make your numbers go like this now any Discerning investor might be like okay cool like let's look at the let's see what um what your what Your advertising spend was let's calculate
the CAC right the lifetime value of to CAC and see like there are ways to to look past just this headline number of like we just went we went to the moon right but when someone looks under the hood they're like you spent a lot of money to go to the moon like is that
sustainable um probably not you know I've been tempted to do that with variety companies in fact like when you are when you have raised Venture Capital certain scale like you have to keep growing otherwise your thing stalls out and dies so you get you know you get you
get tempted to take those shortcuts all the time just like you know publicly traded companies um are meticulously picked over for growth numbers and whatever where they're like if we can just juice this little thing no one will really
notice except the user but the user doesn't the user isn't paying our bills the user isn't making the stock go up 10% I mean they are but the user itself the user experience isn't necessarily making the stock go up 10% it's the user numbers that drive uh that drive
everything so I think like taking that long approach that long-term approach which is you know I think Jeff Bezos did that really well um I think Steve Jobs did that really well to just like really think deeply about hey I know investors like this is you
know we're it's 2002 yeah our numbers look like this but we're actually making all of our decisions long term the people who who buy into that um whether they're your your uh investor stakeholders your employees your co-founders all of that is really
important to to to build so that you're building something for the long term yeah if you're trying to Quick get a flick quick Buck like there you there there are solutions for that uh but it's going to come back to bite you in the ass uh next quarter or the quarter after that or
remember yeah and I'm always intrigued by these lessons that can be extended universally across Industries and across uh you know so for example in investing which is where I spent most of my careers asset manager hyperbolic discounting right every every everybody
just looking at the quarter gave me such an edge and like it was an edge that didn't go away you could talk about it you I could go on CNBC and explain it quite simply like hey I'm not focusing on this quarter I'm focusing on like the next 10 years and people like
everyone nod their head oh yeah yeah of course of course of course and it just continues to persist it's one of those great kinks in human behavior that you can again are Arbitrage and continue to Arbitrage I I used to say you know the
reason that I have any Edge at all is because I can successfully Arbitrage human baate yeah and if you can do that and it persists like it it's a it can ultimately be a gold mine but it doesn't look like a gold mine when you're starting God know it looks like oh who
would ever want to walk down that path yeah it's funny to think about it from a like public equities perspective too where you can look at a company be like I see what they're doing here and like maybe what you're doing you know you could be like I'm gonna go take a a
million dollar short on Apple's you know Apple's next user growth because I think they're juicing it uh and next quarter or in the quarter after that is going to drop significantly because you can see through it like that's that's fascinating maybe I should get into
public equities at some point because this is a yeah I have a lot of these insights at these uh at this like you know micro startup level relative to putting hundreds of millions of dollars of capital to work on like a tiny little tiny little short CL you know it's like
no no they're juicing their numbers like I've been there I've seen it like I'm a product person I know they're what they're doing it's not it's not science to I it's science to me um just wait for two quarters from now you know yeah what
what do you what do you think when you look around and without naming names what do you think uh are the big mistakes that people make when they're designing a product for the consumer market and and we've covered all of the the obvious sort or not so obvious ones
like human behavior is very difficult to change all that type of thing what do you see that like you just would like oh God I want if you know the person I really want to text them and say oh don't do that or if you don't know I'm like oh it lets they're a competitor and
you're like yes yeah I mean I I see this happening in our space too um I think paid ads paying meta Google you know Instagram for prospecting um for driving traffic to the site is it's that's like the the clear indicator of we need to grow and
we need to grow at all costs literally at all costs at high costs uh that is a slippery slope I mean at at feather we definitely spent 10 to 15 million dollars on paid ads over the course of our of our company's history which drives short-term growth um but is
it profitable and sustainable growth right or are there potentially more creative ways you could acquire users who would be very happy using your product versus the people who you pay to come to your site and then just kind of churn relatively quickly because they
they may have been grabbed by the flashy thing on Instagram you're like you know and then they get there and they're like oh yeah not for me or I don't I don't know I don't know why I would use this right now and then just move off that is
like I've been there and I have I have yeah we have spent too much money on that I would like to spend as little money as possible on paid ads um mostly because I've seen what that that heroin can do to you where you think you're everything's good because you're growing
Topline but the reality is your margins are just [ __ ] or your uh LTV to CAC lifetime value divided by the cost to acquire your customer is not very good because you're paying too much for people you're having to like you're taking like a machine gun and just like
machine gunning fish in the water you're like you know there are these things called a net which it's pretty cheap to buy a net and throw in the water like you don't need to use these M16 like caliber bullets to kill a fish you know
you're like have you tried a net you know so I think that's one of the like core learnings having built consumer companies over the last 15 years and invested in them too is like how do you build something and or invest in something that is growing organically
um or that that can grow organically and how do you put those levers in place to make that happen I had yeah the um part of your business bottle also involves getting people into the right credit card and by right I mean the maximum amount of points and
benefits for what they're spending on does does like Prestige play any part in that like you've got AMX is the perfect example right yes like like it used to be the platinum card was 's got a platinum card but then I know but then they did the Black Card the which I don't even
know its name it's got some silly name but oh that that one's like and of course I'm No Doubt the diamond card or the whatever and how do you deal with that and like the The Prestige Factor on credit cards yeah that is funny uh you're you're you're this is all again human
psychology and it's smart by the credit card issuers um MX created this card called the MX Platinum which probably a lot of people have heard of um and what makes that card different well well it's $695 uh per year so it's the it's basically the highest annual fee of a
credit card that exists what's different about it um it's a metal card it's heavy so when you drop it in at a restaurant and you accidentally drop it from too high which is what you do it clangs around it hits the silverware and it means that you are uh
a big a big person uh a very important person who has made it right no anyone first of all anyone can get that card if you just apply for it and you are willing to pay $695 for it that card is exactly what you're talking about which is people be like oh well you know
they'll come they'll come to our Point sessions and say oh yeah I I'm good at I'm good at earning points I use the MX platinum and uh I just need help Redeeming the points that I earn and and then I'll ask them well what are you spending on um and
they'll be like well I mostly spend on you know food groceries uh my utilities I I shop a lot uh so online shopping and clothes and stuff like that and then I'll take I'll like stay in hotels and fly randomly and I'll be like nice well that's great um the MX Platinum earns
you one point for every dollar you spend in every single category except one so why are you using that card like for all the things you just mentioned and it's like well because it's the best card you're like well it's not the best card for you
actually if the one category that earns five it earns 5x points on flights um so if you are booking flights with dollars it's the best card for that that one thing and you should you should use it for that if you have it for sure but for literally everything else you get one
point whereas if you used the MX gold which is is is not not actually a lesser card but people think of it as maybe a lesser card because there's platinum and then there's gold maybe the gold will earn you 4X points at restaurants and four x points at grocery stores and 3X
points at flight on flights and um most people are spending on restaurants and groceries so that card actually would earn them three times what this other card that's more expensive would earn but it's gold so it's not as cool right that is that is
the that's the psychology that we have to get people over sometimes where they've you know ignorantly committed to uh the wrong card and are like maybe a little bit too steadfast to say well yeah I yeah I would like to take three more business class flights per year
like would you like to Yes um if you get this card and you use if you spend the same amount on this card instead of this card you'll get three times more free flights they're like yeah okay I I'll think about it right I'll think think about it it's half the
cost it's three times the benefit it all it takes is using the other ones it's like there there are those funny little uh again human human psychology uh foibles I guess that that we have that we just can't really we can't really get over and we we don't
like failing and we don't like being told we're wrong which even in a good kind loving way is still really hard to hear so I try and do my best to be like you can you know you could do whatever you want with your money right like I'm not your financial advisor for sure but
if you do you came to us and you know you want do you want to earn three times the points at half the cost and then you should probably do this thing you know and and the other thing uh that I know um you spent a lot of time on is and again it's probably the same set of
foibles that lead people to prefer the cashback type card vers the the points card and and you I remember I when when I originally was talking to you I was like really like I had no idea that that was the case and and so how how do you how do you educ
and and convert the type of people who were like yeah this looks really cool and I do travel a lot and yeah I'll use the gold card instead of the Platinum but you know for the for the Visas and master cards of the world I just want the cash back yeah the cashback the
cashback uh cashback is an interesting one um because most most people want um a currency that they can use for anything that they want right cash and they want a currency that they understand which is Cash uh at least us American dollars people know the value
of a US Amer you know a US dollar um if you go to Mexico and you you know you get pesos you know you're getting whatever like 40 pesos per dollar I think it's probably a lot more than that I don't even know um but you don't know what the value of a of a hotel stay is
in Mexican pesos when someone says it's 50,000 pesos you're like I don't know I don't know just like with points you're like it's 50,000 points to book this business class flight they're like I don't know what that means so you do
have to like normalize a currency for people um to get them to understand what it means by putting a retail price in dollars next to the price in points and teaching them that this is a really good good deal or this is a not not a good deal um so to your to your
question on cashback and how do you convert cash back or people who are using cashback to to points if you it's simpler it feels simpler to get cash back if let's say you spend $10,000 on a cash back card that earns you 2% or $10,000 on a points card that earns you 2%
points back um 2% back of $10,000 uh spend is $200 I guess quick math good um and 2x points on $10,000 spent is 20,000 points two times one 10,000 okay so you're sitting here with either $200 of cash back that you could use for whatever that you know and is
comfortable to you ah I've got $200 I could I could buy a shirt two shirts you know great or you have 20,000 points which are fun play money to most people they're like points yeah I don't know whatever it's just like fake money I have stored in an account that is that
is how points feel they feel like they could just be used for fun things um which generally they they can be used for but 20,000 points could be a roundtrip flight a roundtrip economy flight from let's say JFK to Rome and back or JFK to Paris and Back you could get that
for under 20,000 points now when you think about it in those terms it becomes a bit more clear to someone when they're like okay I kind of know what the value of a roundtrip flight to Europe and back is relative to my other option which is $200
I think that's worth a lot more than $200 right but so you have to like kind of frame things in a way that matter to people and in a way that they get versus saying well what do you want 20,000 points are $200 you're like I don't I don't have any idea I don't know but if
you're like okay well do you want a roundtrip flight to Europe for $200 then someone can say okay uh I can I can make that decision so the cashback card is basically a like cashback card for a like points card you're through our product you're going to find way better
way better uses of your $10,000 of spend then you will um get in cash back you mentioned earlier that maybe you should try public markets you maybe you should Jay because it seems to me that you have just a natural ability to find the Arbitrage in a
situation and that is an incredibly useful skill um which is ubiquitous right it it can apply to points right it can apply to a lot of different things though and uh yeah maybe in maybe in your next life you'll be a Titan of Wall Street as well maybe so and what are the
next things that you're looking forward to in the coming year uh for for the company or just in general yeah uh maybe get back to my roots of uh buying and selling things on eBay when I was like 11 that was that was straight Arbitrage
like I didn't even know what the word arbitrage was um but realizing that there was an opportunity to make a bunch of money to buy a car or do other things I was like I would love to do those things when I'm that young so I just started doing that I guess and finding
these little Arbitrage opportunities as a kid it was fun um and also rewarding because I needed a you know needed a car or whatever um yeah I mean in so in the next next year or two I think for me like we're just trying to make so going back to why combinators you know um
motto is make something people want that that's what I keep coming back to every day I even have a mug um that I usually drink coffee out of I don't have it today uh that just says make something people want on it I sit next to them look at it pretty much all
day because it takes me a day to drink half a cup of tea um so that's it it's continuing to iterate on the product and growing our user base um as organically as possible and uh hopefully we're we're teaching more and more people about the benefits of using your credit cards to
earn points and to use those points for flights um I I like our tagline our tagline is free flights for free because we don't charge anything for all of this it's all this is all this is all free um as of the time of recording of This podcast so
uh I love the cat there well we will make sure that in the show notes we have all of the links to the website and to your personal stuff uh if you've listened to the podcast in the past you you know our final question which is we're going to make you the
emperor of the world Jay you can't kill anyone you can't put anyone in a reeducation camp but we're GNA hand you a magical microphone and you can say two things into it and the two things that you say will incept the entire population of the world who's going to
wake up whenever their next morning is and they're going to say you know what unlik like all those other times that I had these great ideas I just had two of the greatest ideas and I'm going to actually act on each one of these things what are you going to incept into the
world's population yeah that's great uh number one is get started so what whatever whatever it is you want it could be anything could be company building it could be making shirts it could be any could be anything just just just get started
on something that you care about um and number two is be yourself um which is way harder than uh than most than than I than I ever thought is to just be authentically yourself as much as you possibly can and when you do that you feel a lot better
other people notice it and I think uh good things good things come to those who uh are authentically themselves I love both of those uh the second one reminds me of Oscar Wild's quip uh you gotta be yourself because everyone else is taken yeah that's a good one that's a good one
well Jay uh this was a lot of fun thank you for taking the time uh and really looking forward to to seeing uh whether these uh all these Arbitrage opportunities continue uh to persist I think they will because I think that they're far more the creatures of human
behavior than some mathematical anomally that people can you just say oh yeah that's crazy let's get rid of that I think so too yeah thanks Jen for having me on the podcast today this has been fun absolutely my joy and a lot of fun for me as well thank you Jay for