My First Million - Business of Trend Forecasting, Pickleball, And The Lucrative Virtual Gaming World

Episode Date: January 17, 2023

Episode 407: Shaan Puri (@ShaanVP) and Sam Parr (@TheSamParr) talk about expanding the business of tracking trends, the explosion of pickleball popularity, and lucrative online gaming. Want to see more MFM? Subscribe to the MFM YouTube channel here. ----- Links: * Exploding Topics * Meet Glimpse * WGSN * GLG * Eureka Surveys * The Dink * Virtual Gaming World * Do you love MFM and want to see Sam and Shaan's smiling faces? Subscribe to our Youtube channel. * Want more insights like MFM? Check out Shaan's newsletter. ------ Show Notes: (06:10) - What it takes to be big on YouTube (10:50) - Forecasting Businesses (20:55) - Pickleball (38:10) - Tom Dundon (44:00) - Virtual Gaming World ----- Past guests on My First Million include Rob Dyrdek, Hasan Minhaj, Balaji Srinivasan, Jake Paul, Dr. Andrew Huberman, Gary Vee, Lance Armstrong, Sophia Amoruso, Ariel Helwani, Ramit Sethi, Stanley Druckenmiller, Peter Diamandis, Dharmesh Shah, Brian Halligan, Marc Lore, Jason Calacanis, Andrew Wilkinson, Julian Shapiro, Kat Cole, Codie Sanchez, Nader Al-Naji, Steph Smith, Trung Phan, Nick Huber, Anthony Pompliano, Ben Askren, Ramon Van Meer, Brianne Kimmel, Andrew Gazdecki, Scott Belsky, Moiz Ali, Dan Held, Elaine Zelby, Michael Saylor, Ryan Begelman, Jack Butcher, Reed Duchscher, Tai Lopez, Harley Finkelstein, Alexa von Tobel, Noah Kagan, Nick Bare, Greg Isenberg, James Altucher, Randy Hetrick and more. ----- Additional episodes you might enjoy: • #224 Rob Dyrdek - How Tracking Every Second of His Life Took Rob Drydek from 0 to $405M in Exits • #209 Gary Vaynerchuk - Why NFTS Are the Future • #178 Balaji Srinivasan - Balaji on How to Fix the Media, Cloud Cities & Crypto * #169 - How One Man Started 5, Billion Dollar Companies, Dan Gilbert's Empire, & Talking With Warren Buffett • ​​​​#218 - Why You Should Take a Think Week Like Bill Gates • Dave Portnoy vs The World, Extreme Body Monitoring, The Future of Apparel Retail, "How Much is Anthony Pompliano Worth?", and More • How Mr Beast Got 100M Views in Less Than 4 Days, The $25M Chrome Extension, and More

But I actually think there's an interesting business where you can look at anything that someone is having to spend a substantial sum today for something that's going to happen in 12 or 36 months. And you help them guess the right prediction. You can build an interesting business. And I'm going to give you an example. Okay. So let's do it. What topics you got today? All right.

I've got one idea based on something you sent me. Oh, wow. We're rich. Yeah. But you... Thanks, Sam, for having one idea. based on something I sent you. You sound like you really put in the work today.

Look, I'm in the final interview stage for my new researcher. But you told me last time you had a lot. And just hear me out. So you sent me this thing called exploding topics, right? Yeah. And you said, their traffic's killing it. And exploding topics, do you want to explain what it is? Yeah.

It's basically like a, if you go to the website, you'll see a series of charts. And the charts are basically saying, hey, this thing. this trend is is growing in in popularity. I think it started by which keywords were growing in popularity because Brian Dean, who owned Backlinko, a popular SEO blog, got involved with it. And then it kind of changed to what it is now. Okay, yeah. So I didn't know what the underlying, what are they looking at to tell you what's trending or not?

But they'll be like, you know, hey, there's this thing called PowerDash. It's a vacuum cleaner for pet owners. It's grown 3,000% right now. Right. But the volume of that search is 320. So not huge. Regenerative agriculture, right? Growing 658% with 12,000 searches.

And you can look at that and you'd be like, huh, that's cool. I'm interested in that topic. Maybe there's something I could do here. So I think it's similar to what trends was, which was, I will tell you about things that are getting more popular before they're fully popular in order for you to take advantage of them with content, business, that sort of thing. Right? That's the idea.

Yes. And the people wondering, trends, so basically I used to own, I sold it, I used to own this thing called Trends.com. And it was a weekly email on an online community that people would pay $300 a year for. And we got it. I forget what it was when I sold it. But I think it was at like $6 million a year. But it very easily could have been like a million a month or so in revenue. But basically we would send a weekly email and we had three or two researchers and they would comb the web and five interesting things.

And they would write interesting reports. and they would also include one to two graphics that showed, like, here's based off of Reddit searches or based off of Google searches or based off of like 20 different data points, this topic is growing quickly. Anyway, what exploding topics is doing, there's another company called MeetGlimps. So I think it's meetGlimps.com or dot com. I don't know. And this is just called trends forecasting. And these versions of it, including my version, they're what I would call prosumer. So people who just want to spend $10 to $300 a month on it.

They're not that big of a deal. But there's this whole other industry of people willing to spend $25,000, $100,000, $10 million a year, all on trend forecasting. And I think it's a very interesting business model. And I think it's a very underdeveloped industry. And so the one that I brought up a whole bunch is called WGSN. WGSN, it's basically a monthly report that comes out. and it helps people pick which colors are going to be popular. What sounds trivial, but that's a really big deal.

If you're Starbucks and you've got to go and buy 10 million name tags or something like that, and you want to make sure that you've got like a good color that is like hit. Or, for example, WGSN, do you remember, Sean, how pineapple was popular? They helped predict that pineapple, the logo, is going to be popular. Their next one, I think is the lemon. I think they said lemon is going to be popular. Maybe you told me that actually. And so anyway, that's what this does.

but I actually think there's an interesting business where you can look at anything that someone is having to spend a substantial sum today for something that's going to happen in 12 or 36 months. And you help them guess the right prediction. You can build an interesting business. And I'm going to give you an example. And let's just say that it's like HR or like work styles. So what do we think we're going to predict this particular age group? what are they going to want for working from home in the next 36 months? And if you're Google or someone that employs 10,000 of these workers,

you're like, all right, I kind of need an idea because we're going to be making X policy. We want to know how they're going to react. The way it could work, and this is the way WGSN, and this is the way trends and a few other things work, is you do a combination of surveys. So you survey, like you need a pool of like 1,000 or 10,000 people you can survey and get intel from and make predictions. Then you look at, like, different data. So like you look at sentiment. You look at like what people on Reddit on TikTok are saying.

what trends are saying. And you consolidate that into a fairly easy to understand 1,000 to 2,000 word email that you send out monthly. And then you have a consultant on staff who you can call on a regular basis to be like, hey, we're thinking about doing X based on your research. Is that a wise decision? And then you have monthly calls as well as a community and a conference. And I think you could wrap this up and do it in most any industry and have something that you could charge $20,000 to $50,000 a year for. And this is something that, what's his name? the baldhead guy who I like, Scott Galloway. He did this with, he did a little bit like this with his company that he sold for $300 million.

What was it called? It was called, uh, L2. But anyway, this is my model that I think not enough people know about and take advantage of that I think could be pretty big. And, uh, I wish you would let me guess which bald guy you like. That could have been, that could have gone on for a couple hours on that one. I have so many that could have been the answer. Yeah. Stone Cold Steve Austin.

Yeah. What, so what would you do? So what was your idea here of like how you would create kind of like a trend status prediction type business? What I would do is I would package my product in the way that I explain. But I think that most industries that you work in, you can figure out some type of thing where you can look at the buyers of your company and be like, or look at any different roles in your company and be like, hey, everyone, can I just talk to you and like figure out like,

what decisions are you making that's going to impact us in like two years? And what type of data do you wish that you had today that would make your decision easier? And I'm sure this exists, but one version of this I could think of that's pretty valuable would be if I could pull like, hey, I, you know, we got a, we're able to survey every, you know, CIO in the Fortune 500. And, you know, we surveyed 70% of the. the CIOs and the Fortune 500, here's what they're thinking in terms of their software budget for next year. Or here's what they're thinking in terms of whether they, you know, we, HR people at the, at the, you know, top thousand companies, here's what they're thinking in terms

of remote pay or here's what they're thinking in terms of the XYZ. And I think if it's sort of like what GLG is, where GLG is expert network and people will pay people like you and me $2,000 for a one hour call. because they're making investment decisions and they need to do research and they need actual industry input to say, hey, what's the deal with this? I'm not an expert at this.

You are, but I need to make a $10 million bet. And so as part of my research and diligence, I'm going to pay you know, you and 10 other people like you, $2,000 an hour, $20,000. No problem. That helps me make the right directional bet here. And so I think rather than GLG being a one-way thing, I think you could do it as a,

as a, you know, kind of like pulse survey to as long as you had the right key, key audience that was bought in. Now, how do you get them to actually answer this? I think you could, A, just do it as part of a broader, like, media thing. Like, if you already have a newsletter for HR people or whatever, you could do it, like industry dive could do this. I also think you could pay them. And so I think there's some version of payment and rewards that could go with this because

you're probably charging a lot of money, thousands of dollars for these reports. But there is another business I want to tell you from a listener here. What's it due? It's called Eureka surveys. So Google Eureka. Yes. Yeah. The bootstrap company.

Yeah. So these guys, if you go to Eureka surveys out of Utah, right? It just says, get paid for taking surveys, right? Make money online. Here's how you do it. And it's like, these are the small time version of it. So basically you go, you download their app. Let me pull it up.

You download their app. Did he say we could say their revenue? He told me it, but I don't remember. It told me once, I think we should just say it maybe generically, but like, you know, seven figures in revenue bootstrapped off this product idea. And, you know, kind of amazing, kind of amazing that they are doing so well. And I think that this is like a really great business. He acquires, I think in his case, I think he's going for kind of younger audience, sort of like,

you know, Gen Z, millennial college students, maybe stay at home moms, like, you know, more of the average Joe type of. consumer and able to survey them and they offer gift cards in return, like the brands who want to run the surveys offer gift cards. And it's a great way to, it's a great way to, you know, get insight, you know, quickly. Like for me, if I have a brand, right, I have a brand, I want to run a survey like this. That's pretty, that's like pretty time intensive for me to go do. So I would need to go to a service like this if I want to get an answer. Well, so that's my idea for trends forecasting. I think the survey one's interesting. There's a lot of competition in that space, but I still think it's interesting. But that's like a simple, this is like a very simple, straightforward thing. It's a lot of work, but a huge business, I think.

All right, what do you got? Okay, so I'm going to tell you a couple names. I'm going to throw a couple names out at you. You just try to tell me the pattern. Leonardo DiCaprio. Kevin Durant Ellen DeGeneres Luca Donchich

George Clooney he might be thinking movies you might be thinking sports and maybe celebrity investing where am I going to this? No they all play pickleball pickleball is this crazy crazy thing that is exploding

it's not going to be new to most people here but I'm just sort of late to the party I played for the first time the other day when we did our kind of weekend getaway for founders thing and we played it's a lot of fun and i was like i get it i totally get while you guys haven't it took you that long yeah i i don't leave the house so it's not an in-my-house activity so therefore this is the first time i got exposed to it right like you know like i'm those people that that like you know came out they're like covid what what's going on um that's what happened to me with pickleball and so i started looking into it and i think there's

something, I think there's a bunch of little interesting things. I want to hear kind of what you find interesting of this, but I'm going to throw some stats at you. So my overall take is pickleball is exploding. Here's some opportunities I see and I think it's going to be huge. It already is getting huge, but I don't think, but I see some potential traps and I'll tell you what those are. Okay. So first of all, guess how many people in America is a tough one. Yes, how many people in America played pickleball in the last year? 20, no, uh,

uh, uh, 5 million. Good guess. 36 million. So 36 million is a crazy number, right? That's, um,

twice as many people as go to like Disneyland every year. It is, that's the population of California, right? So 36 million is a kind of crazy number, right? That's like 14% of the, of the total population. And,

um, and you can see this trend growing, right? So it went from five to 36. That was in a one-year jump. You can see on Google Trends, it's just up into the right line. You have celebrities,

like I said earlier, billionaires, buying teams, leagues, that sort of thing. I personally know two people who have built multi-million dollar brands in this space. I'm going to tell you about them.

So one guy, I can't say his name, but he built a Amazon FBI store. And this was two or three years ago, he sold it. So he actually sold way too, early. At the time I met him, I was like, oh, great. You built a store doing what? I've never even heard of this sport. And he was like, yeah, I just got into it, you know, got really into it. And so I just

thought, oh, let me just see if there's much competition on Amazon for this. There wasn't. So I built a popular FBI store and sold it for about $8 to $10 million. And so the guy sells it for $8 to $10 million. And I was like, wow, you know, you know, highway robbery, you know, tell that guy to lose. your number now that he owns, now that he spent $8 million on this, you know, pickle what, what the hell is this?

I bet you if you had that thing now, that'd be a $40 million brand. You know, like this thing has exploded in popularity. Whoever bought it knew what they were doing. The second is there's a guy doing a newsletter called the dink. So he's doing The Hustle or Milk Road for pickleball. And we talked to him and we were like,

we talked to him and we were doing a road. How do you spell it? I see it. The dink, like D-I-N-K. and a cool guy he's doing a bunch of really smart things on the growth and kind of like content side and he was making more money per reader than we were making on milk road we're in the crypto like finance niece and he was making more money per reader in pickleball than we were because he was

a he's executing well and b like turns out you there's like you know there's a lot of people who want to advertise and people who want to buy stuff and there weren't really very many mediums for them to meet each other. And this newsletter was, was that. So this guy was, yeah, I think this newsletters probably worth three,

three million, four million dollars today. So two people I personally know that have done this. Okay. And I got a couple ideas here on, I want to talk about why this works, where this is going, and also just some of the interesting characters that are involved here.

You've played. I assume you've played. Yeah, but hold on. Before we, I'm looking stuff up while you're talking. I've got a few, I told you soes that I want to bring up. I was looking this up as you were talking. Episode number 147.

This aired January 19th, 2021. So almost exactly two years ago. Let's go to the listener notes. It says, Sam brings up pickleball, a booming sport in Austin. And it talks about all the opportunities there and why he thinks it's going to be big. Sean brushes it off Stupid Never going anywhere

Sean gives Sam Wedgie Tells him F off Then You talked about Dink I was like That sounds familiar So I wish I could Can I share my screen right now

I don't I won't share my screen actually I look up Dink founder It's a guy named Thomas Shields I Google Thomas Shields Twitter I go to his Twitter I click his DMs

And there's an unreaded message That he sent me in September 18th, 2020. Hey, Sam, Thomas here. Nice to meet you. And he sent me a video on YouTube where it's a custom video of him talking to the camera saying, hey, Sam, and he's explaining to me

about this newsletter that he wants to start, and he wants to know if I want to participate in it or something like that. This is the first time I've seen this video, by the way. I'm not even, I'm watching it for the first time ever. So I was, I take full credit for telling you about pickleball.

I take not full credit, but It is cool that this guy hallowed at me, and this is three years later, and he's absolutely doing what he said he was going to do. Man, he didn't respond to the personal video, huh? I, well, this is an unread Twitter message. I never saw it. But anyway, so that's my story before we can. Huh. Yeah.

Well, I remember seeing it, but. Twitter's actually great because you can open up a message. And they don't know. And they don't know until you hit accept. And you can read the whole message. And so people were like, hey, you never saw it. I'm like, yeah. So anyway, that's my story.

So you were asking me, have I played pickleball before? And my response to that is, does Dolly Parton sleep on her back? Yes, I've played pickleball before, dude. Of course I have. Have you seen me? Have you looked at me? I'm a tall white guy from the Midwest. Of course I played pickleball.

Do I like peanut butter and jelly sandwiches? Sure do. Am I taking a swing of a, of a, of a, of a, of a, of a, of a, of a, of a, of a, of a, of a, of a, I'm an old school Coca-Cola classic right now, sure. Yeah, yeah, you ever had orange soda? Of course. Do you know how pickleball started, by the way? Old people.

It was like a senator or something, right? Yeah, dude, you know your shit, man. This is crazy. That's crazy that you know that. It was a congressman. It was a board congressman who created this. It was 1965. It was in the Pacific Northwest.

And they get back from some trip, him and his buddy, They have nothing to do. They're at this house. They have nothing to do. They're bored. The house has a badminton court. They're like, great. Let's go play some badminton, I guess.

They go down there. There's no equipment for badminton. They're like, oh, fuck. What are we going to do? So they're like, well, we got ping pong inside, but we kind of want to be outside. So they take the ping pong paddles, a wiffle ball, and they go to the badminton court, and they start inventing this game. And they're just bored and they invent this game.

And they're like, they call it pickleball because I guess there's this phrase called pickleboat, which is like a hastily assembled crew for a boat. And they're like, I was a mashup of, we just grabbed the paddles and play badminton and lowered the net. It's like this mashup thing. We'll call it pickleball. And so they create this thing.

It's like, you know, just a small regional game. Nobody's really playing it. And somehow, I couldn't figure out the link, but like somehow about the last five years, this thing has gone like very,

very mainstream to where now there are professional leagues. there are tons of celebrities own teams that there people are buying Gary V's buying a team Kevin Durant's buying a team Tom Brady's buying a team Patrick Mahomes is buying a team these teams cost a million dollars now there are billionaires that are trying to buy leagues and merging the leagues to try to make this like an official thing it has become kind of real and there's people are trying to create like top golf for pickle so there's place called chicken and pickle and camp pickle that's trying to like basically create venues where you can

drink, eat, and play pickleball. And so there's like this, you know, mini gold rush that's happening right now in the world, in the world of pickleball. And I started thinking, okay, where do I think this goes? Because I've seen this now a couple times. I've seen this with MMA, right, going from super fringe to more mainstream,

esports, and even some other things like the drone racing league. You ever seen the drone racing league? DRL. Yeah, I don't quite. Yeah, that one hasn't picked up. I thought it was going to, but maybe it will. Same. Same. And so you see these happen and you sort of think, okay, what does it take to make these work?

And I'll give you what I think pickleball has going for it. And then I'll tell you what I think is going to be tough for it. So here's what I has going for. By the way, we had a writer at a freelancer at the hustle who quit for a year. And she became, she wanted to compete in pickleball. And she did. And she started traveling to competitions. Yeah, like it's like an intense thing.

People love it. What did you say to her when she told you what she was planning here? What do you think I said? I said, that's awesome. It's awesome. Get out. Yeah. Give me your laptop.

Give me your laptop right now and then get out. And that's awesome. Yeah. But it is awesome. Text me a pick. Go after yourself. You're like, objectively, this is awesome. Emotionally, I feel a little wounded.

And I'm rooting for you to fail. No, but she did. And she's doing good. Okay, so here's what I think it has gone for it. So why, like, let's brainstorm. We've done this with food. Remember you had your food thing that was, I think, like, low-key genius. And nobody really respects you for it except for me, but like.

That's such a left-handed compliment. Look, people don't get it. I do, but no one else does. No one else does. Your parents don't understand, but I'm okay with your lifestyle. We've talked about it two or three times just to, say the joke again to see if it hits. And it just doesn't seem to hit.

But like, let's do it again. What's your food thing? And then let's do the equivalent for the sports world. So for food, I was like, there's like a handful of categories that you need to check off in order to make your food go viral. So it's either got to be like a side food where it becomes the main thing. So it's like instead of like ice cream that has cookie dough in it, it's like only cookie dough. The other thing is it has to be a different color than normal.

So green ketchup or rainbow bagels. or it has to be a different size, so like a huge pizza or a really small thing, or the last one was it has to be the combination of two things that are related, but you wouldn't normally have done it, like the cronut. Right.

Yes, exactly. Again, genius. Finally, hopefully you get you to do this time. So I think there's sort of a similar thing when it comes to creating a hit game or hit sport. Because when I played pickleball, I was like, okay, that was fun. And here's what was fun about it.

there's zero learning curve. Like we literally, nobody even really explain anything. They were just like, stand here and when the ball comes to you hit it. And then they were like, there's two rules. Don't go in the kitchen and like,

you know, whatever, here's how the scoring system works. They told me that as we were playing. It was very intuitive. It's like, okay, cool, got this paddle similar enough to tennis, similar enough to ping pong.

I kind of already know how to move my body this way. All right, this will work. So zero learning curve. We were playing and the age range of the players, that we were playing with. If somebody had their son there, who I think is like, you know, 11 or 12.

But I think you can basically play this game from age 8 to like 65. And so everybody... Dude, my mom's close to 70, and she goes to her pickleball league twice a week. Okay, we might push it this to 80. You know, I don't know how... But this is super broad range.

And how many sports can you really say that for? Very, very few sports can be played by extremely young and extremely old people. You could just play it with two people. So you don't need, like, five on five or like, you know, a full football team or basketball team. It picked up during COVID because it was kind of like an outdoors activity that anybody could do that was sort of socially distanced.

And so I think that was like a big factor in why grew. And it's basically like a lightweight version of tennis or even maybe even a lightweight version of golf in the way that people use it because you could talk while you're doing it. You're not like just huffing and puffing and running the whole time. And lastly, and most importantly, you can play the game drunk. And so this is like, you know, if I wanted to create the perfect game, those would be my criteria. And then, you know, out would come,

would come pickleball. So I think it's, it is kind of a perfect game in that way. So I think it has legs for that reason. I think it's going to keep getting more and more popular. The fact that the whole state of California worth of population plays this game, has played this game in the last year, is crazy. And you also see other things going for it.

Like the founder of Lifetime Fitness, you know, like the gym chain, got really into pickleball. and then put $500 million into building pickleball courts in all of his, like, locations because he's like, I love pickleball. People are going to love this. And so he deployed half a billion dollars into building infrastructure. Dude, I love that. And people are converting tennis courts, all this stuff is crazy. There's 35,000 courts in the United States now.

Dude, tennis sucks anyway. Only, like, a couple people know how to play it. You know what I mean? Like, my wife took lessons on how to play it, and I would go and play with her, and she would serve it at me, and I would basically just try to hit it back. And that was how we played. It sucked. It sucks.

And then I would serve it to her. A weird form of abuse, actually, is what you just described. Tennis is stupid. So to anyone listening who wants to capitalize this, we can brainstorm. But I'm going to summarize this in the two simple words, okay? Vince McMahon. If you are in this business, remember those words. Vince McMahon.

Who's Vince McMahon? Vince McMahon is the owner and current or former CEO of the WWE, the world wrestling entertainment. I don't know what it is. but it's at any time that we grew up, you know, Stone Cold, The Rock, this is WWE. Back then it was WWF. Dude, when you think about it, WWE is just a bunch of ripped dudes in their underwear having a soap opera in front of 50,000 people, and then the rest of the people on TV.

It's all it is is a soap opera, and there's a little bit of ripped dudes in underwear wrestling. That's all it is. And it's awesome. You've got grown dudes who are like the most, like, homophobic guys ever. and yet they're like sitting there watching two oily ripped dudes just roan around. It's like, you know, they get past it all because all they care about is the story, the drama. This is all you need to do. So if you're interested in this, you just go and get a picture of Vince McMahon.

You put a picture of him on your wall and you just say, what would Vince do? Yeah. What would Vince do? WWVD. What would Vince do? That's all I'd care about if I was entering into this because that's exactly what happens. tennis, I only cared about what's her name, Serena, in that last, like, tournament that she was in because it was her last one.

You know what I'm saying? Like, I only care about this Naomi Namasaka lady. I only care. What's her name about, what's her name? What's her name? Osaka. Osaka. I only care about her because, like, I hear that she's kind of like going a little, like,

she's having some mental issues and I'm like, oh, okay. Now I'm kind of interesting. We got a train wreck? Hang on. Yeah. Yeah. Like, I'm into it. Like, that's like what I get, I get hooked on it.

like, you know, some of these like sports that I don't think are mainstream, I get it. Like Lance Armstrong, guy gets cancer, maybe he's on drugs, killing these Europeans. All right, cool. You got my attention. Like, I need a story. And that's what anyone who's interested in pickleball needs to understand. This data is wrong every freaking time. Have you heard of HubSpot?

HubSpot is a CRM platform where everything is fully integrated. Whoa, I can see the client's whole history. Call, support tickets, emails. And here's a task from three days ago I totally missed. HubSpot, Grow Better. So I think as funny as what you just said is, I think you're totally right. I remember when we started working on an esports product, right? Like that's what got bought by Twitch.

We were building basically an esports company. And I met with a venture capitalist. This guy, Zach, he goes, love esports, but e-sports needs it's Dana White, which is basically Dana White was the Vince McMahon of the UFC. And he goes, Dana White is like there is no UFC without Dana White, right? Because literally the company was going bankrupt. So,

you know, I don't think literally there would have been a company without Vince, sorry, without Dana and his and the Fatita brothers coming in and buying it and putting in, they bought it for $2 million. And then they burned another $40 or $50 million trying to make it successful at a loss

before it finally turned around and it started to become a thing. And so they put in years, millions of dollars, and expertise at promotion, and willing to just run through walls to make it happen, going state by state to get this thing licensed so they could even host events. And then hosting an event figuring out,

how are we going to sell tickets? And once they sell tickets, how are we going to get this thing on TV? Once it gets on TV, how are we going to build these characters in the storylines? Oh, we got to invest in all of these documentaries and reality TV shows and things like that. Before smartphones,

were even a thing. Dana used to give his guys. I remember, you remember when they first came out? There were these video cameras that looked almost like an iPhone looks now, but it was like a flat, flip cams. He goes, hey everyone, we're having a meeting. You UFC fighters, everything you do, here's your flip cam. Record it, posted on like, I forget what was popular. I think it was YouTube. But he was like one of the first guys to do that. Totally. Totally was the first one. And he had to do it because no mainstream channel would let him in. He couldn't get a, you know, now they're on ESPN. it took 20 years to get onto ESPN as a sport. That's how crazy this was.

And so you need somebody like that, which is basically just saying you need a world-class, one in a billion entrepreneur if you're going to make this work. And there are some interesting characters that are involved in this thing. Do you know who this guy is Dundum? If you hear this guy, the search,

Dundum Pickle Ball. There is this billionaire who is like really trying to make pickleball a thing. Like so this guy made his fortune doing subprime auto loans, which like you didn't, I didn't have to say the Tom. Yeah. Tom Dunham. Yeah. Yeah. Some prime mortgage loans. Like you don't even have to say he made his fortune. If I just said, yeah, he worked on subprime auto loans. You'd be like, oh, so he's filthy rich, huh? Like, you know, like there's no. You don't put those four words together without being a billionaire. And so he's super rich. He takes a bunch of. He takes a bunch of. big wild bets. So he put, I think, like $70 million into an NFL competitor called the AAF that like basically folded before it even had its first game and he lost $70 million dollars trying to do that. Now he's basically, he owns pickleball.com. He bought the major league,

you know, the biggest league for pickleball or like, you know, there's two competing leagues and he bought one of them. And this guy's like trying to make pickleball happen. And he's, dude, he also owns the majority of top golf. He owns a majority of top golf. Yeah, he does a bunch of stuff like this. So he is a pretty fascinating guy. There's a bunch of, like, really, like, interesting characters that have, like, kind of pushed this forward.

So he's one of the guys who've pushed us forward. There's another guy named Seymour Rifkind. You ever heard of this guy? No. Why would I have heard of him? Here's some things about Seymour Rifkind. Self-made millionaire by creating a marketing company. All right.

Check. Does Iron Man's? Check. Does Ultramarathons? Check. Taekwondo Black Belt. check. He has bicycled solo coast to coast. Check. He created the first rating system for Pickleball. He did all of this after the age of 50. That's pretty baller. That's a pretty baller post-50

resume to have. So this guy kind of pushed the ball forward and kind of helped legitimize it, make it make it more popular as well. And then obviously there's all the players and the people who have been playing at the grassroots as well. So I feel like with pickleball, there's just like this tremendous groundswell. And here's a couple of my quick takes. First of all, RIP Badminton. I knew for the first time I saw Badminton,

Badminton was a little bit of a bitch sport. I could tell. I saw it coming, and I avoided it like the play. And it just needed a little tweak, a little tweak there for Badminton. And, you know, pretty sad for Badminton. It was like sitting there the whole time

and miss this wave. So, you know, that sucks. Second, could this happen again? Like, I need to go start playing all old people's sports and just sniffing around. Like, what's up with Bocci ball? How do you play this shit? Is this good? Is this the next thing?

Like, there might be another old person sport that could be translated down. Third, you may not know this, but I was on the cusp of creating the next pickle ball. Back when I was in middle school, me and my buddies created a game called golf. You might be wondering what's golf, John? And golf was basically a combination of golf and ping pong. It was an extreme version of ping pong. And shout out to my guy, Steve Adi, who was there with me in our game room. And we created golf.

And I guarantee this is the most fun game ever. And we invented it. We just didn't know how to commercialize at the time. Incredible game. My version of that was in eighth grade. We came up with the game called Nutball, or you? It's bloody knuckles with other parts of your body. Oh, no, it's better.

It's called nutball. You sit 20 feet apart and you sit on the ground with your legs. Oh, I played that game. Yeah, and a person has to throw a ball. The first person that flinches loses. Yeah, move you lose. I used to get in trouble. Yeah, my, the sister Mary came up to me and said,

Sam, no more nutball. So I got bad. Which is a win of itself. Funny story. So I left, you know, We did that weekend kind of retreat founders thing. It's like, okay, we're going to brainstorm. We're going to really make plans.

We're going to think about what's next. We can give each other great business advice. I left early on the last day. So I missed the last 24 hours. And so I hit up Ben and I was like, Ben, how was the last day? Would I miss anything good? Anything really, you know, do you have notes you can share with me? And he goes, no, we basically just played pickleball for seven hours because Sully really wanted to beat me in pickleball.

And he couldn't, but he wouldn't let me leave. until he beat me, but he just couldn't beat me. And so we just played four and a half, five hours straight. And I just beat him nonstop. And then after that, we didn't talk. And I think, like, that's the sign of a great game, a game that could take over your life and make you a bit of a degenerate. So I am all in on pick a ball.

Dude, they'd need a leader with a good name. When I was in San Francisco, I got into competitive ski ball. And the guy who ran it was called Joey the Cat. And you remember Joey the Cat? He braided himself in San Francisco. He's Joey the Cat, the Sky Ball. guy and people would rent ski ball machines for him like startups he was just like renting out ski ball machines to bars or to offices and startups yeah yeah yeah yeah yeah and he was making good money doing it right

he was making great money he owned he owned like anywhere where he had like a little warehouse with all of his ski ball machines and it was joey the cat and all of his uh ski ball machines had like a tiger stripe on it and uh oh you got you you got a joy the cat machine that's great man you this it was like a status yeah it was like your office is like you guys you guys you're Must be doing well. You're having, you have fun in your office? Oh, cool.

Yeah. Oh, you're into like local shit? Nice. Right, right, right. Oh,

you're supporting this local guy? Joey the cat. You have kombucha here? Wow. You guys got it going on. So this guy needs a, the leader of, of,

uh, of, uh, pickaball. They need a cool name like Joey the cat. I feel like there should be like a tiger sound every time you say that. All right. Um,

okay, cool. Let's do one more topic. Okay. I want to give you one more, interesting person that I think is worth talking about. Okay, so have you ever heard of virtual gaming worlds? No, dude.

Whenever we talk about this, what's my answer? Well, it's just kind of like a rhetorical question, really. I play sports. That's what I... Yeah, that's right. I play sports and I eat meat. You ever about Metaverse Quest? You're like, no.

No, I'm too busy. fine. I beat up the last guy who said those words to me. So go Google, Google this company. You're going to be kind of interested in this. So go to this website, and I just want you to guess their revenue. Just say, we'll play a game called guess the revenue. Well, it's just like a little square space, rinky dink site looking, I don't know,

$5 million? Close, close. Three and a half billion a year. Oh, great, great, great, great. With $500 million of profit, and they did this in 10 years. So what they do is they're basically They're one of the only legal online casinos in the United States. They own one of the largest poker sites in America called Global Poker.

And basically it's casino games done via sweepstakes and trade promotions. That's kind of like the legal arbitrage here to make this work, is that they do it as it's not gambling. It's basically sweepstakes. And they have a patent on it. So they have like very, it has very little competition at the moment, apparently. And I got to give a shout out to the guy. So there's a guy who sent me this message and a bunch of notes on this.

I'm going to shout him out real quick. It's kind of, he was like, dude, you got to feature this guy. He's basically a billionaire. He pays it like, you know, basically he, he just dividended out, you know, in the latest, like, whatever year or quarter and just bought a private jet off the, off the dividend. It's like, so shout out to this guy, Ansel who, who told me about them. So crazy, crazy, crazy business. He's Ansel on Twitter. All right.

So here's what's interesting. So the guy who started it, he's an ex-financial planner. He basically was not a builder or a seller, right? Like the typical startup archetype is like, you're a great engineer or you're the great growth marketer. And he was neither. He was a solo founder. He was a financial planner.

Didn't know how to do marketing, didn't know how to do coding. He was basically just a badass. And he recruited a bunch of- Lawrence? Yeah, Lawrence, exactly. He paid a developer agency to handle the build-out. So didn't have a technical co-founder CTO, just hired a dev shop.

You know, it wasn't perfect. Like they basically, the code was so buggy. Like the slot machines would accidentally just pay you out a bunch. And this happened several times. They had to like survive that. And this is built out in Perth, Australia. So this is like built in the middle of nowhere.

So kind of violates all the rules. Single founder didn't have the skill set. Wasn't in a big city where, you know, oh, you got to move to Silicon Valley or New York or wherever to do this. He came to Silicon Valley. once couldn't raise any VC because they can invest in gambling opportunities. But the good news is that means this guy didn't take on any investment, take on much investment, didn't get diluted. So he still owns 66% of this company that's doing 500 million a year in profit and just, you know,

three and a half billion in revenue. And so, you know, it's a, you know, basically started fully remote. They got their first office eight years in, uh, you know, eight years into the business. It's pretty crazy. Dude, it says he, um, wow, this is amazing. So he said, they, they, increased their profit and they made $454 million in profit and it paid dividends of $413 million. I actually have a question. So does that mean that the company only needs $40 million or whatever the, yeah, $40 million in cash to operate? Either that or they have enough cash reserves already there to whatever, let's say their

burn might be $100. They might have already a stockpile of cash reserves. So they just divot out the excess. That's wild, man. This is wild. So it's all based around this workaround, which is that the U.S. law lets you. do sweepstakes. And so they offer sweeps coins that can be redeemed for cash.

And they have a trademark or our patent around sweepstakes trade promotions. Basically, they worked with the U.S. lawyers to build a system where, like, customers can basically buy virtual gold coins, use it to play the games. They have no value outside of the game. But they, when you buy the gold coins, you get these sweep coins with it. And, and yeah, basically, like, they found, like a, it was a regulatory insight, not a product or marketing insight that allowed this to happen.

And sweepstakes are regulated basically like state by state. So in order for something to change, every, you know, different states each individually would need to change something in order to make this happen. And yeah, there's basically like, you know, brands that will use multinational company. Like there's like sweepstakes companies that you can use to run sweepstakes across states because of the complication. Dude, whenever, whenever people tell me, Hey, I have an idea.

Should I hire a developer or should I hire one of these agencies to make an app? 99% of the times I say, no, you're wasting your money. You're never going to do anything with it and it's just going to go to waste. Right. This is the guy. This is the guy. TopTal needs to jump on this guy as like a story of how these things work. This is a really fascinating story.

Yeah, exactly. And there's a video of him in 2012. He's pitching at the launch conference to Jason Calicanus. I don't know if it's this exact idea, but basically, you know, similar sort of game. family idea. And all the judges are basically like, oh, you know,

the opportunities outside of the U.S. is too hard in the U.S. And, you know, didn't listen. Like, knew his, knew his shit,

understood that there's like, a regulatory moat and a, uh, a patent moat that he could create that would allow him to do this. And basically create kind of like a small, not small, sorry, a large cash cow.

Um, that's essentially like on, you know, nobody's really competing with him on this, which is kind of crazy. It's surprising to be that a patent would be this. this powerful at stopping somebody from competing. Because in tech,

patents usually do nothing. I don't care about patents at all. When someone says they have a patent. Whenever they say someone has, by the way, what do you, Khan McGregor? Nice.

I like that word. You should bring that back. Yeah, a little Brit. Yeah, you got to call me mate. I like that. That was pretty good. They, uh, whenever I hear someone say they have a patent at,

like in a pitch, I'm like, I think that means nothing. I don't think it's a breadflank. I'm usually like, that means you think it's something and it is nothing, which means you don't know you anything. Yeah, it's like asking me to sign an NDA to hear someone's pitch. I'm like, oh, yeah, you're, this is a joke. We, uh, I remember at one of our startups, it was like, um, or like when we bought Bibo back, we got the patents with it.

And it was like, oh, this is a patent for, um, like the idea of like going on a social network and whiteboard, like there's like a whiteboard where one user can draw anything on this virtual whiteboard. I was like, oh, you invented that? He's like, yeah. And I was like, cool. but like, I use that on Facebook. He's like, yeah, because this means nothing. This piece of paper means nothing.

And it does nothing. And like, you know, impossible to really use this or enforce this or like, you know, just way too hard in the world of like internet innovation to make this work. That was my, that was my belief coming in. So this is a bit of a framebreaker here for me on, uh, on like why this guy has no competition doing this. And it might be some other reason. There might be another reason, which is it might be that this is actually shady AF and like

most entrepreneurs don't want to do it or, you know, there's too many lawsuits or whatever. definitely that one, by the way. Definitely. I think it's definitely that one. Without like knowing anything about this and just going strictly off like a guess with zero information other than I see this guy owns a bunch of Ferraris. Probably that one. Oh, his Instagram is prolific. And speaking of, uh, of, of names, this guy's got a name.

Lawrence Escalante. Like tell you can't be Lawrence Escalante and not have a profile picture as he, does where he's like this at a poker table and he's just looking over. Yeah, he's them boys. That's what is, that's what is his Instagram bio needs to be just, I'm them boy. This guy's the, this guy's the guy's the guy. Well, congrats to him. That's an interesting fine. He, uh, this is a crazy story. So yeah, yeah, that's super fascinating this over. That's, uh, he knew he's like, dude, I got something that's great for MFM and sure enough it was. Yeah, it's juicy. That's what that's called. That's called a big juicy burger. It's a good fine. By the way, we forgot.

Oh. I totally forgot. Speaking of legal agreements, patents, important contract, there's one more. Look, if you've made it this far, normally if you put this in the beginning, this one's for the for the real OGs who are into this. There's a thing called the MFFB, My First Million, gentlemen's agreement. And by the way, Sean, in our last video, you called it a gentleman's agreement. And then you actually said, shoot, We have four women listeners. We have to call it a woman's agreement. And did you see our four women listeners actually comment in the YouTube channel?

And in fact, many said, no, you have more. I'm number five. But what they don't know is that actually there can only really ever be four for whatever reason. It's just like a law of physics or something like that. One in, one out. It's like a nightclub. And so we really appreciate all of you.

All four of you are like near and dear to our hearts. We look forward to getting to know you personally because we can, because it's four. And actually, they don't even need to sign the gentleman's agreement. They're in. They're grandfathered in. Their grandmother in. There's two requirements here.

If you've made it this far in the video, and also, if you've ever listened to more than one video, Sean and I dedicate like dozens of hours a week to making these videos. So now you are in debt to us. And all you have to do to repay your debt is click a like. You don't matter if you're listening on Spotify or iTunes. I always call it iTunes, but you know what I mean. It doesn't matter where you're. you're listening to, you go to our YouTube page, type in My First Million and then click

subscribe. And now we're even, and we work for you. It's called the gentleman's agreement because we're not there. I can't see your computer. So you just have to do it. Just don't lie. So please go and do that. And that's it.

Yeah, it's like, you know, Biden was thinking about canceling student debt. Well, we're going to cancel your debt. You're going to cancel all your podcast debt if you just do this one thing. Like, I mean, I couldn't think of a better deal for you, honestly. So honor the gentleman's agreement. Go to YouTube. first million click subscribe and turn the notifications on too why not dude by the way this part of the pod has become a fan favorite yeah this is really and i have to say i stole this from someone jesse on

fire i stole this from him he's another YouTuber but this has become a hit don't know why you're admitting that i would just steal everything and say that he stole it from you um and let the well he's a he's a he's a UFC podcaster so maybe he can kick my ass and how does he i've never heard it uh he goes look the other day i went and i saw the dish at 7-11 it was for Alzheimer's or like muscle something, disrophy, and I left a quarter there. And I didn't steal the other quarters.

I just left that one quarter there because that's called the gentleman's agreement. And I stand by it. And that's the same thing with this. I edit the video. I come up with the content. I do all this work. I do it for you.

What you're going to do for me is you're going to click subscribe. That's our agreement. This is how society works. And right now, everyone's doing it. And if you haven't done it, you're being left out. So please do that. And that's this pitch.

It's pretty good. It's good. And it's tough to come up with it each time. I feel like in doing so, we also earn our part of the gentleman's agreement just by making it interesting, right? We got to earn it. All right. We should, we should wrap it up.