My First Million - Data-Based Businesses, Executive Briefings, and Spotting Scams with Anand Sanwal

Episode Date: January 31, 2023

Episode 413: Sam Parr (@TheSamParr) and Shaan Puri (@ShaanVP) talk with Anand Sanwal (@asanwal), CEO and co-founder of CB Insights, about how Anand built his companies, the importance of data, small business niches that are growing, and much more. Want to see more MFM? Subscribe to the MFM YouTube channel here. ----- Links: * RebelGirls * USNews Best Colleges * McCormick Corporation * Anand's Twitter * CB Insights * How To Manage And Sell A Company In An Industry And A Country You Don’t Know * 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: (01:15) - Anand's Background (05:00) - "Sawdust Data" businesses (9:00) - Tiny but growing niches (13:30) - Daily executive briefing email (18:30) - Pricing data business (24:30) - Broke & Busted College Rankings (31:30) - McCormick Spice Competitor (41:30) - How To Manage And Sell A Company In An Industry And A Country You Don’t Know (48:30) - Adani Group Collapse & spotting scams ----- 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

I love how even though I tried to pick a non-nerdy data one, it actually underneath the hood was a nerdy data one. You're like the, you're a data hammer and the whole world is just little nails that you're just trying to hammer with your, you know, like. But dude, this is the best business there is. You're just hoovering in the data like a vacuum. You're the data Dyson that's just taking in this data from everywhere you can. Man, founders are like a lot of times not good at explaining what they do to idiots. So can I do it? So, all right.

I'm going to make you look cool. I want to be your wingman. All right. So you run a, I don't know if you call it software or a data business, but people pay subscriptions. And your company, CBN sites, you're now getting close to $100 million a year in revenue, which is like a huge accomplishment, hundreds of employees as well. And basically, and this is the part that's kind of hard to understand for someone like

Sean and I, because we haven't run like really, really huge companies. But basically when a company that has a thousand people have to decide what, you software they have to buy, like, let's say it's just like some customer support software or payroll or something. They need to do tons and tons of research to make sure that the business that they're going to pick, the vendor that they're going to pick, like, we'll stay in business or will be around for 10 or 20 years, things like that, as well as a bunch of other information. And you have crawled through what you call dirty data. So all this data out there exists, but you just put it in bits of software that make it really easy to digest and understand

so a person can make a right and smart decision. And they pay you like 30 or 50 or a $150,000 a year to access all that. Is that right? Sounds about right. Yeah. And more importantly, fan of the show and prolific idea guy before this episode, before we did this episode, he sent over a Google sheet that is 77 rows of random startup ideas, which just tells me you're one of us. And so this is great. You made our job really easy. We have a bunch of ideas we can go through. There's a few kind of interesting CVS. insight stories that you've blogged about in the past I want to talk about.

Let's do those at the end because I think the ideas are going to be a lot more fun. Sam, you favorite of yours. Sean, one of the reasons why he's fun, you said that he's one of us because the idea thing, that's true. He's also fun because even though he comes off like this like polite guy who's like introverted, he's a shit head. A non's a shit hit. His Twitter is hilarious.

He always, he writes this famous newsletter to like 500,000 people now and he signs it with like, I love you. And in his Twitter, the bio says, please buy a CB Insights subscription. I owe people money. And like, he always does, like, he kind of pokes a bear a bunch in his stuff. So he's got a really cool attitude. But hopefully we'll get that out of you. Yeah, yeah, exactly.

Yeah. My kids were excited that you called me a shithead. So I appreciate that one. You're welcome. Here we go. Sam, you put your favorites on the street. put my favorites. What's interesting to be is we have almost no overlap. You, uh, only maybe two out of the 10 that you put down there were my favorites. I had completely different ones. I'll tell you why.

I say we take turns where we say tell us about blah, blah, blah, like the little, the little three set, three word tagline and he gets to pitch it and let's react and let's try to get through a bunch of these. So we might go on random tangents or drill down, but like let's in general try to go, uh, you know, an inch deep on each one of these for now. You want me to go first? Yeah, you go. So the reason why I highlight, basically everything I highlighted, so CB insights interest me because basically you're not coming up with any data.

You're just organizing data that already exists in really easy to understand ways. And then you're selling it at high fees. And I think that's like the greatest business model on earth. And you've listed out a bunch of ideas, including like six or seven that were more of these like data things. So you had one in there called sawdust data. And you have examples. You're like, you can look at what the government does.

Like the government has all this data. You can make that clear and easier to understand for people. Both the sawdust data as well as the government data products. What do you mean by all that? Yeah, so sawdust data is people create products. And sometimes the residue of that product is actually really interesting data, right? And so that's the sawdust from the data. And so it's basically taking that exhaust.

And so I'll give you a couple of examples, right? You have, and I don't know if these are businesses already, but, you know, Open Table and Rezi have all this reservation data. I wonder if you could take that data exhaust and sell it to real estate firms, right? And they'd be, you know, hey, like, reservations are down. This area is not as hot. Maybe this retail space is going to be on the market soon because this restaurant looks like a dog, right? That might be one area. You know, I think I met somebody who has dog collars, like a fit bit for dogs, right?

Five. Yeah, five, right. And so you could take that and probably sell that to pet insurance underwriters, right? So it's like it's not your core business. It's this residue that comes off of your business that I think you could do interesting things with. It's another example, like procurement management system. So kind of this like esoteric enterprise thing. But if you have all this spend going through this procurement management system at your company,

could you go and sell that to hedge funds on like, hey, this company's, you know, average contract values going down or it's getting a lot more seats sold this year, right? And so can you take, again, not your core business. And I don't think companies are really good at monetizing this on their own. So it's basically building this platform that goes to these companies

and build these data products off of their sawdust. Does that make sense? With the business that Sean and I are and we're in newsletter business, like people have all these questions, but it's kind of broken down into just a few things, which is just like figure out what content you can give people that they want to read every single day

and then figure out how to acquire users for profit profitably. And that's basically that's 80% of the business. What's like the 80-20 thing for these like data businesses? Is there, or rather the 80-20 for making messy data, clean data and make it a product that people like? The messy data to clean data thing, that's just like you have to have a pain tolerance. That's all that is, right?

And so I think this is why this is actually, I think, why CBI has done well. we've had a bunch of Valley companies come in and they want to splash machine learning on it. And like, you just have to get into an Excel spreadsheet and clean the data. Like, that's just it. And if you're not willing to do that nasty work, you're kind of dead. I'd say the businesses that work are, I think, like, my framework is variable skew, highly opaque, high consideration. And so I'll break that down.

So high consideration means like somebody's taking risk or putting a lot of money out there, right? It's just like, it's got, there's some skin in the game. Opaic, meaning it's just hard to find. And I think if you go into Slack groups and people are like, hey, does anybody know X? That's usually an asset class that's like opaque, right? Does anybody know who a good vendor is for this or a good software provider is for this? And then the last one is variable skew, which is like a car is a high consideration software purchase, but it's not really variable.

Like it's got a set of features. You can compare them on a grid. and so the internet's really good for that. I like businesses where like the variability of the skew is significant because you can't just put it into a table. You can't like an iPhone's an iPhone as an iPhone, but like we launch yardstick like, you know, I don't know, radiology software that uses, you know,

that AI reads radiology images. Like those are totally different. And so that's like the framework I use. And so when it meets on those three, I think that's an interesting, messy, hard business that's going to be a lot of pain, but you could build a moat around that. All right, Sean, do you want to do it?

You had one of your columns. So I told you you have 77 rows, so those are the different ideas. But then you had some columns. One of them was frameworks or inflections, and that was one of your things, opaque, variable skew, high consideration. The other one you had was tiny but growing niches,

or like inflection. Like it might be time for that to grow. Is that your other one that you look for in ideas? And we can give an example here of like, let me grab one. Like you did this representation media. So you said, extend the Rebel Girls book for other communities. And then your framework was Tiny Brook Growing Needs. So talk about that idea and explain it with that framework.

Yeah. So Rebel Girls, if you're a parent of a daughter, you might be familiar with it. So we bought this book when my daughter was, you know, three, four. And it's just like one or two page stories of like famous women in history. So like Amelia Earhart, Marie Curie, Mike. Maya Angelou. And it's great. Like it's a it's a really kind of inspiring book, really cool artwork. That book is sold, I think, 5.5 million copies at like $20. So it's like $110 million. And that's probably dated, right? But I think there's like this idea of like what I,

what I call representation media, right? I bet you could extend that to, I don't know, like Hispanic entrepreneurs or like autistic scientists, right? Like people want to read about and see examples of success in their communities. And so I think you could extend rebel girls across a bunch of different things. And so that's the, I think that niche is growing, right? Like people, like you get these micro communities that actually are pretty large that would love to read about themselves and receive good representations of themselves. That's a great idea. I've had a similar idea because we get gifted some books that are like, I don't know, like Hindu religion book or like, like, the kids version or something like that. It's like the like, and it's like, oh, yeah,

if I'm going to read whatever, you know, Clifford the Big Red Dog, you know, like, is there, is there something that, you know, adds a little bit of something from our culture or religion, like makes it easy for me as a parent to like give them, you know, something I want to give them while still being entertaining and accessible. And there's actually just not much that's out there for that. So I definitely think if you added up all those little different issues, that could be quite big. Yeah.

I mean, I think if you kind of un-PC, if you found a story where the protagonist was like a little white kid, like make it a little brown kid, make it a little black kid. You know, like modify the story a bit and like that's a winner, right? Because like kids love seeing like, oh, that kid looks like me. That's

dope, right? And so like you're off to the race is there. I don't think it's that. nothing's hard it just takes some work but yeah dude that's why my that's my wife loves kim kardashian she like sees them she's like oh hey look they got fat asses too dude fat in a good way by the way when i met uh the comedian hasan manhazi we he was like doing his live shows and i had told him i was like he asked me something like oh what would you do with you with my business if you or me and i was like dude i would stop this like live

touring thing that comedians do like this is so painful you're on the road like i don't know 40 weeks out of 52 in a year i wouldn't want to do that i was like you got to create a broadway show i was like create like the next hamilton and then that goes on tour right touring is a great business but you just don't want to be the guy sitting on the stage i was like use your creative and comedic genius to do that was my kind of big idea for him he said all right what's the show and i was like ah dude i don't know now now i'm out of my and then the next like a week later I just sent him a voice note and I go, Aladdin, but Aladdin's black. And then he's like, what?

And that was my whole voice note. And then he goes, what are you talking about? I go, remember the Broadway show thing? I go, it's Aladdin, but they don't, it's not like Jasmine can't marry Aladdin because he's like a poor guy. No, no, no. Jasmine can't marry him because he's black because like, you know, her family doesn't approve. And then he's like, okay, so it's just he's black instead.

of poor. And I was like, hey, look, what do you say it that way? It doesn't sound that good. But, like, I'm telling you, there's something to this idea of he overcomes and they fall in love and the love wins. And he's like, all right, yeah, yeah, I'll add that one to the list. And I was like, yeah, that's what he said. He's like, stick to podcasting, Sean.

Well, yeah, representation media. All right, can I ask you about one? This is actually really fascinating. And actually, I think it can be a bigger business than I don't know if you think, but bigger business than a lot of people think. A daily executive briefing email. Yeah, I don't, I'm not sure how big this one could be.

I think I, I don't know if I put it in the sheet, I say, you have like a dollar column, which is kind of like my indication of how big it is. I think this is like a great side hustle business, right? So when I worked at American Express, every morning our CEO would get like a briefing from his chief of staff, right? Like, you know, here's what Capital One did. Here's what City did yesterday. Here's what Visa did, whatever.

And it was like basically that person's job to like scour the internet. and like look at financials and product launches and all this stuff. And there was a company that Cision bought called Bulletin Intelligence, which I don't think, I don't know how much they're doing with it, but it was basically that idea. It was going to be like your morning chief of staff email. And yeah, I think this is an awesome business that like somebody smart and industrious can build. And I think if you go niche, meaning like go financial services because like if you get Amex,

like the CEO of Citigroup like cares about pretty, Citibank cares about mostly the same company. So you can reuse a lot of it. And it's not just the CEO. It's all like their division presidents and their like geography, like, you know, heads and all that stuff. So yeah, I think this is like, and, you know, I'm sure with generative AI and stuff, you could like make this really like efficient. But yeah, I think this is like a tens of millions of dollars business.

No, I think you're way off. So have you heard of, you guys know Politico, right? Yeah. It's like a Politico is like a news website. for DC, all politics, but it's not from like a CNN, Fox News perspective. It's more so like people who work in politics. They read Politico. Whatever. That's not interesting. What's interesting is that they sold recently to Axel Springer for over a billion dollars and where they got roughly nine figures, so 100 million plus of recurring revenue, they have this,

they have this service called Politico Pro. Have you guys heard of, not have you heard of Politico Pro? No, I mean, I know that's a premium offer. I don't know what's in it. So basically, I think it's like a thousand a month. I forget the pricing. So someone's going to like get on me. But they have this. They're pricing. But basically it's for if you're a lawyer or if you work in D.C.

And you have to know what type of laws are happening at like a real rate. Like who, you know, like, hey, the Senate is thinking about changing this. Like because we heard this senator say this in the news. Yada, yada, yada. Well, anyway, they have these things called pro. briefings. And they send at least one a day, but sometimes more than one a day. And it's really fast, short emails. And that's your briefing of what's happening that day with a very, very, very, niche thing. So for example, they have a segment just for pharmaceutical companies. So if you're

pharmaceutical and you want to know right away what's happening with the new laws, or if you want to dive deeper and read about researchers, or if you just want to have a conversation with an analyst, You spend thousands of dollars a year, tens of thousands a year, and that's basically what you're getting. It's this briefing as well as a few other things. They scaled this business to north of a hundred million in recurring revenue. And it's pretty fascinating. And there's a few others doing that. And so I think if you could actually pick the right thing, whether that's pharma, legal, I don't know what else there would be, all different types of finance.

I think you could actually build a really interesting daily briefing business. And you could even have a user say, which companies they want to spy on a little bit more than normal. And I think you could charge tens of thousands of dollars a year for a subscription like that. Yeah, you can charge a lot for this. Like these folks, as long as you deliver quality in the morning when they need it, like, yeah, they have sort of massive budgets. And I think Bulletin had Bezos as a customer for a while. So like he was reading the Bulletin Intelligence briefing every morning. So what's that company called Bulletin? Bulletin Intelligence. Cision bought them many years ago.

Dude, the reason why I like talking to you is like you and I are some of the few people that nerd out on there's like all these data businesses out there. So you and I for years have talked about there's like Informa, which is like a $10 billion market cap, basically data and trade show business. Then there's Euro money, which we've talked about, another publicly traded company. There's a Cision, which like is just kind of an older company that no, it just these companies are just huge and they're just not sexy. So they're not talked about with our circle. but they're crazy fascinating to learn about these companies because their margins can be huge. Yeah, it's a build once-sale multiple times kind of business, right?

So, like, once you build that data asset or that info asset, like you can keep selling it. So, yeah, they're great businesses. They're unsexy, which is always good because, like, then you don't get all the smart people kind of trying to come in and, you know, each or take your lunch money. So, yeah, I like these businesses a lot.

You had one on here also that was the pricing data. So it was like, go extract the, the pricing data from every SaaS tool. Go to their website, find the prices, organize all that information for things where it requires a demo, quote, like, I don't know, send a, you know, $5 an hour employee through that process, collect the pricing data. Now you have it.

Now you can make that visible where they are hiding it on their website. And you basically have a giant, what, like a search engine or a database of, okay, if I want to use some email, you know, send software, or here's how the prices compare across them. Is that what the idea would be for that way? Yeah, I think the idea there is, I think you start with public SaaS pages and you figure out how to crawl them or just, you know,

M. Turkum or something. And then, yeah, email service provider, what's the pricing, what are the features? I think the real killer there, which is, you know, maybe borderline, is like you actually, because a lot of enterprise companies don't put their pricing on their page.

So you hire somebody who goes and pretends that they're a customer and gets the pricing. and then that's really, really valuable, right? Because like now if I'm, because pricing is like a dark art in B2B, you're like, yeah, sounds good, right? And like everybody's got opinions and nobody has data. So I think you could actually do something really interesting there, like long term if you actually called companies and got that pricing

or talk to their customers and you get their pricing. That's actually the tagline. It was the tagline on your website, which is without data, you're just another idiot with an opinion or something like that. I think that's great. It was great, right? I don't know. Do you guys use that anymore?

We don't use that anymore. I think we still use like in God we trust all others got to bring data. Like, so we'll use that in some. Who comes up with this stuff? This is you or this is someone on your team who's like the witty copywriter? These are just stolen from other people who are. It's like a quote. The idiot one's a quote, I think, right?

I think both of these are like, you know, somebody like some luminary and, you know, we footnote them in small print and give them credit. Do you think that you guys being kind of silly is a leg up or do people criticize you? Yeah, I mean, we get some criticism, but honestly, like, B2B is so mind-nummingly boring that, like, it's great as a way to stand out. But, you know, I tell the team, like, you know, love us or hate us, you should have an opinion on us. And so that's the general theme, right?

Because most of it's like pretty vanilla and, you know, just kind of like jargony. And so, yeah, it's been, it's been, I'd say a net positive for us. But we've lost some customers over stuff we've said, offended them. Like what? You know, we did a ranking one of VCs once and we said a specific firm was losing in the ranking. And it was just an objective thing. And they were like, we're canceling our subscription immediately, right? And what a loser move of them.

Just proved my point. Oh, you don't want to. access to data now. You got, you got your feelings hurt and you canceled your own, your own data pipeline. You're like, you're down another peg. So we've had, you know, that. And some people don't like, you know, I think when Trump hysteria was going, we'd like sometimes put an infographic with him in it. And like, we didn't have an opinion, but it was just like, you just, him and Elon Musk, like, if you mention them, it's just like, lunatics come out, right? And so like, and so it's good for engagement, but it is definitely like a little

it can be odd like you say something and people just like they've you know it's it's a cult and people go kind of crazy like i you you're a really good writer and or whoever's writing is really good and you guys always use things like um your headlines are really good but then there's like just phrases all over like it's built in your culture like in your annual review we're like hey we did pretty good for a company that isn't lighting money on fire like the rest of the vc world or like just like little phrases like that it just makes you stand out and i think that that makes you have a voice and You guys are actually pretty good at that. Yeah, and I appreciate that.

I mean, I think it's, you know, it's partly for the external market. It's partly for the team, right? Like, you're selling B2B software. And so sometimes that can be like, you know, if you're 22 out of school, it's like, hey, that's not super inspiring. And I don't know exactly what that looks like. And then once we can show them, we can have personality. We're in the tech economy, which is interesting.

So, yeah, it works. You know, we screw up a bunch of things, but that's been good for us. If I was going to go out there and do what you said of getting all the data and, like, hiring people to call and actually get quotes. Who would I sell that to? On the software pricing? Yeah. I think you go to product teams at software companies and say like, you know,

or your chief revenue officers and say like, hey, like, you know, do you know how you came up with your pricing? Like, you know, and here's what your peers are pricing at and give them like a snippet and give them a taste and be like, hey, and we have all this other detail behind. How much would you charge? I mean, I don't think you start anything with like CROs at big companies and like you start at, you know, $20,000 to $50,000, right? Like it's easier to go low than to start low and go high. We just, you just handed someone listening a pretty solid idea, right?

I think that. I think the thing people do is they underpriced. We did this in the beginning. Our CB Insights when it started was $395 a month. month. And what you actually got was a bunch of people who didn't know how to use data who were a pain in the ass, right? And so it was like your worst nightmare. It was people who churned quickly, who paid you little and who were blowing you up on chat all the time for support. And then I remember meeting a management consulting firm and they were like, hey, can you add a couple zeros to the price?

Because like one, your price will look like a joke internally. And two, I don't want to wait behind the guy paying $3.95 a month for service. So like, price is a indicator of quality as an indicator of other things beyond just like the core value of the product. So that was like eye opening to me. Like I was always like, oh, you know, price low and you know, do all that. And like, you know, now we're orders of magnitude higher than we used to know we started. That's awesome. Sean, what do you got? Let's do some non-dater nerd ideas. So I'm going to pick a different one. Do the college rankings one. Yeah, yeah. Let's do the college rankings one. What did you call it broke and busted? Broke and busted college rankings.

Okay. So what's the insight here? So I think U.S. News and World Report is sort of like the preeminent college rankings. There's been plenty of coverage about how that's a basic con, right? And like universities do all this sort of finagling to try to get higher in that. You know, I look. How's that work? How do they pay or what is what's the con? I don't think it's that they paid. I think it's that like, you know, you've got these like, subjective criteria, like, you know, student to teacher ratio, right? And so, like, universities will, like, massage that data so it looks good, right? And so, like, you know, it's like a limited set of factors. And it's unclear how causal those factors are to actually

getting a good education, right? And so I think you turn that on its head. Well, I think U.S. News and World Report, you know, I think in like 2013, it was doing like 40 million in revenue. And now it has like, again, LinkedIn, 500 some odd employees. So I got to believe it's doing 100 million plus in revenue. And I'm assuming college rankings is the number one thing. So I think the thing you do here is you actually go to graduates of the school and just ask them for their W-2s. And you're like, how much are you making, right?

You just took on a bunch of debt. Like, does this place actually get you a job that gets you paid? Or are you like, you know, a server in a restaurant? and you got like you're $200,000 in debt. And so I think you reach out to alumni, go get their W-2s, and basically put a ranking together of, here's how much I paid and here's how much I make when I get out. And if I'm a parent, I'll care about that.

I'll be like, I don't really want to send my kid to a school where their prospects for employment are garbage. And so I think it takes all of the, it's a very singular characteristic. So it doesn't take into consideration and social life and all that other stuff. But it's like, I think it's pretty important, right? Especially you got all these people like leaving school with, you know, tons of debt.

So that's the way I would do it. And you'd have to probably pay those students or X students a little bit, but I think it's pretty cheap. And you probably go like, do like New York colleges to start. Like start niche. Like don't try to be everywhere right out of the gate. Like, you know, and then build out from like concentric circles from there. Do you under like, I don't know about you, Sean, but like, like,

Like, what is, we're talking about some nerdy stuff here, but I find it like crazy fascinating because it's very clear to see the opportunity here. But what's shocking is like when you say, oh, I'm going to go get the data, someone like me, I would be like, well, I got to go like Google it and like find a database. And you're like, no, I'll just like hire like, I'll use mechanical turk you said earlier. Or I'll just hire someone or I'll just like make a ton of phone calls. And just doing that stuff, I can get interesting insights. And is that really how a lot of this works?

And the beauty of that business is 99 people out of 100 won't do that work. So like once you built the data asset, like most people will think it's cool and they just won't do it. Like the other one that I like, which is, I don't know if I put on the page is, you know, I was trying to get a pool bill at my mom's house. And like pool pricing is just like it's opaque, highly variable and high consideration. And like I have no idea what to pay for a pool. Like some kid should just go door to door at every person's house that has a pool and just be like, how much did you pay for your pool and like get the specs and then go find out and then find out what do they pay per month for cleaning and whatever. I don't know what a pool requires and like literally build the database of like. That's a great idea.

Pool's in North Jersey. Here's what it costs. Yeah, because that's what people Google too, right? Like, you know, pool cost and then my city, right? That's a, that's a term that people will look for. Or even if they're just looking at pool cost, but you have their city in the headline, they're going to click that one over the next one.

And then you go back to the pool people and you're like, hey, listen, I got this pricing. Next time you want to bid, you probably need to know what your competitors are bidding. So like you can sell the data to both sides, right? Like, but it's definitely like it's a perfect side hustle. Like, you know, it would be like a thing that, you know, I hope my kids will like just go do this, like door to door and go get data.

I love how even though I tried to pick a, non-nerdy data one. It actually underneath the hood was a nerdy data one. You're like the, you're a data hammer and the whole world is just little nails that you're just trying to hammer with your, you know, like you're just hoovering in the data like a vacuum.

You're the data Dyson that's just taking in this data from everywhere you can. Yeah. I mean, I love that business. And I actually think like not to get off on a digression, but I think this whole at GPT thing is actually going to make private data like that much more valuable because like, You know, before it was like, oh, I'll give you my data and you'll just link to me and I'll get Google.

But like, like, that's all going away, I think. And so like having access to private data is going to be really valuable. So yeah, I'm extra bullish. And do you look at like, for example, the pool one is a good one because it's probably not, the pricing is not probably changing all the time. Whereas maybe the college one, you got to redo the data collection every year in order for it to be accurate. Like, for example, in the content game or the media game, which me and Sam think a lot more about, is like, if anybody can do really well with evergreen content, that's so much better than somebody's doing what we were doing,

daily emails where it's disposable, and you've got to recreate the product the next morning, otherwise there is no product. And so do you think about that when it comes to data, like either the ease of collection or the longevity of the collection really makes the idea more valuable versus less? Yeah, I mean, I think you probably want data, maybe counterintuitively,

that requires a lot of refresh. right? Because that's what keeps people subscribing. If I can get the data once and it's good for three years, it's like, all right, I'll get it, I'll churn, I'll come back to you in three years when it changes. When it's actually a little bit more, when there's a little more volatility to it, it's like, hey, I need to know what's going on because my business might suffer or what have you. In the case of the pool one, the pool owner's only going to buy it once, right? But you know that, but that's okay, right? Because like you could sell those leads to pool people. You could sell

that to pull cleaners. You could do all sorts of interesting things with it, right? And so, like, it doesn't have to be you're selling the data. You could build advertising and lead gen and other businesses off of it for sure. Okay, I got one that there's no way this can be a data one. A McCormick's spice competitor. Yeah, I don't, this one I don't have a lot. This is, you know, I think I have a column called Zone of Excellence, and this one's out of my

zone of excellence. McCormick's is like this multi-billion dollar spice company. Oh, okay. I recognize. If you open up your spice, whatever cabinet, like, there's probably like these spices with like a red top, right? Like, that's all McCormick's, right? $24 billion company.

Wow. And sales? In sales? Market cat. Wow. Public company. Yeah. So it's just like, like, you know, why isn't there like the, I don't know, the apple of black

pepper? Like I don't really know how to do this shit, right? But like, like, what's the, what's like? Well, I think for this one, you're right. can go either higher end or, you know, just the more fun look at, just branding, packaging, design, and influencer, most importantly. So like, who is the, you know, the whatever, the Martha Stewart of YouTube that you can partner with that can be the face of a brand like this, right? Like, who has that kind of brand and gravitized that can get into a target or, or the store

shelves at supermarkets to compete with something like this? And I think that's, that's the way I would go if I was going to do this. Yeah, 100%. I think the thing that's interesting about this, and I don't know anything about McCormick's, is like the bundling. Like, you know, if you buy salt, you need pepper. If you need pepper, you might be needing oregano and you might need whatever flakes that they sell out there, right? And so, yeah, you could just keep stamping this out across like every spice category. But yeah, this is not one. This is outside of my zone of excellence. So I do in this one, but I like it. They own everything. I didn't realize this. Have you guys ever, have you ever seen this protein bar at gas stations? called Tiger's Milk. No. Have you ever seen?

Yes, they own this bar. It's the worst looking, like, it's basically a label. It looks like it was like drawn by Kenny Powers or like, it looks like if Power Rangers ate a protein bar, this is what they would eat. And it's just like, it's called Tiger Milk. And it has a, it has a face of a tiger. And it's like their protein bar. They own that.

They own a bunch of different stuff. This is awesome. Yeah, I totally should have. Oh, they own Franks Red Hot. That's my favorite. So, yeah, what a company. I didn't realize that these guys were what they are. That's wild, man.

They're created in the 1800s. Yeah. I mean, yeah, they're just, you know, brand recognition and everybody knows. I mean, if you go to the spice aisle, it's all that. Like, they just own the whole thing, right? So you've got to come up with a distribution hack here, but that's, you know, Sean, that's probably more your world than mine. But yeah, for sure.

Can I ask you a quick question, different from my ideas, but about money? So I'm not going to, you can say it if you want. I'm going to assume that you own a chunk that you are on paper worth mid to high, low to high, hundreds of millions of dollars. Have you taken any money out of your company or has your only income for the last, I think you said 10 years, you've been running this, just been like a normal mild salary? Yeah, so I didn't pay myself for the first four years. So when we raised money then, I basically took my back salary. And then since then, I've not, uh, not taken any money off the table. So yeah, I'm, I'm foolishly long or brilliantly long CB insights. We'll see what,

we'll see how things play out. But yeah, I'm all in. Were you wealthy before you started the company? Like, did you have banker wealth? So just no, no, no, no. I just, you know, I got married right before I started the company. I told my wife when we were dating that I don't want to work at a big company anymore. And we're I'm like, there's going to be some lean times. And so she was down. And so I just saved religiously. Like we didn't go on vacations with friends and just like, you know, and it was always like awkward because they're like, oh, do you want to go somewhere?

And I'm like, oh, I'm super busy. But I just was like, no, I don't have money. So yeah, I just saved like crazy. I'm busy being poor right now. So I can't go. Sorry, I'll check the calendar when I'm not for. I'll start going. I just saved a ton of money.

And then, yeah, for the first like two years of CBI, just. I just paid for a small team out of my pocket and then we started generating revenue. Wait, why haven't you taken a few million bucks just off the table just to make your life a little bit better? It would have no material output. Yes. And by the way, just so we have numbers, you basically have only made, I imagine, middle hundreds of thousands of dollars a year in salary. Is that right? Yeah, I mean, I now get paid like a fair CEO salary, right?

So I'm not like, it's not like one of these big public company guys, but like, yeah, I think I just, we've been really focused on the business. And like, I just think it's a giant opportunity. And handedly, part of the reason we didn't raise in the beginning was because I don't think I'm good at pitching. And I also worked in venture and I didn't like want to work for my investor. Right. Like that was always like a very guiding principle of mine. Like, you know, and I look at S-1s of companies like, oh, public and I'm like, you know, the founder owns like 5%. I'm like, that's just like, that's a backwards calculation. Yeah, probably, you know, should have, could have taken money off over the course of time. Right now would not be a good time to do that given where the markets are. So I figure we'll just keep growing out of this current sort of malaise that we're in. And then, you know, opportunities sort of tend to present themselves. Even our fundraise was like a customer sent us a term sheet over email.

I can find this client info. Have you heard of HubSpot? HubSpot is a CRM platform, so it shares its data across every application. Every team can stay aligned. No out-of-sync spreadsheets or dueling databases. HubSpot, grow better. Tell the story of the guy who offered you $100 million via DM. How did that go?

I get some interesting DMs on Twitter, and so somebody offered $100 million. I think this guy was broke as a joke, but it was still funny. I said, you know, not interested, not looking to sell. And I think then the email chain kind of devolved from there where he was like, you know, I'm going to build a competitor and put you out of business. And yeah, it was good. What's his name? I don't recall.

I don't recall. It was like some. You blurted out of the thing. I think I blurted out. Yeah. So he says this DM, you posted the DM screenshots. It starts like, hey, here's who I am, really interested, you know, in partnering or an acquisition. Let's talk.

Please call me. And then you were like, thanks. Yeah. Not even thanks. T-H-X, right? Just like the short thanks, not for sale. Nice. And he goes, and then he goes, how about a partnership?

And then he just keeps going and he's like, here's, how about this? I'll give you $100 million for the business. You are now, if you're producing your responsibilities, you have to present this to your board. You know, you know that. Let's go. And then you go, you go, okay, interesting strategy. Best of luck. And he goes, so do you accept the offer?

And then he devolves into, all right, then I'm going to create a competitor. Have you seen this competitor launch? Is he eaten your lunch yet or what? Surprise, surprise. Yeah, we're tracking religiously to see when this launch is. But yeah, nothing yet. You should DM them back, be like, hey, how's it going, man? Curious about the launch details.

Yeah, yeah. Now, that was atypical. I think most of my DMs are nice. But yeah, that one was a little out there. What would you do with the money now if you sold? I mean, I think the thing I'd do is I want to build a school of entrepreneurial. Like, I think education is broken.

And so I think, like, kids should just learn how to build businesses and not go to college. And so that's what I do. And I think there's a bunch of colleges that are struggling that I could go buy, like, a plot and build, like, a dope campus for a bunch of, like, high-achieving kids. and we'll just like go figure. How much would that take? I have no idea. I have no idea.

This is like, but you'll have it. This is my distant dream. But yeah, I think like, I just read a great book called the case against education. That kind of breaks us down and it's really interesting. And yeah,

I think it's like, I think there's an interesting thing to be done there. And then, yeah, I'd love to like do some stuff in India along that lines. But yeah, this will be my last true startup. I've looked into a bunch of,

I have like alerts set for colleges for sale because I had a similar dream and idea at one point in time. I now don't want to do this, but it's amazing. You can buy full college campuses for sometimes single digit millions, sometimes just like $10 to $15 million. It's crazy. Which ones? It has to be less than the replacement cost of just the buildings and the land in these places. So I am not sure why. And these are accredited universities.

A lot of them are, they start as just like, they do one like thing. It's like just cosmetology or just whatever. There's like those. Those are really cheap. Those are like, you know, 1.5 million. You can have a, you know, a university or a college that does that all the way up to here's a campus in New York for this like small liberal arts college that's not doing so well. And like, you know, for $15 million, you could take the whole thing.

And I'm like, wow. Is there like a marketplace for that? Is there a Zillow for bankrupt universities? There should be, but there's this one website called DealStream that happens to have most of them that I see. So DealStream will send me emails of one, like, you know, multi-campus beauty school, here you go. You know, that just got this email two days ago.

What made you sour on this idea, Sean? Just like the lifestyle component. I was like, would I want to actually, if I was going to do this, it was like, okay, I'm going to basically go be the dean of this school. And I'm going to like, basically, this will be my baby. And I will make this great. And I was like, oh, it's a lot easier to just like have a business I can just do on my phone and my laptop, you know, four hours a day and not worry about this and just hang out with my kids and, you know, have fun.

And so I was like, okay, yeah, there's an all in version of entrepreneurship that I'm no longer like super interested in because that would require, you know, same thing. Like, I'd rather do this podcast than go speak at events. I think in the last three years, I got invited to speak at maybe 150 events, and I've said yes to two of them, right? Like, you know, so it's like you could make good money and grow your audience doing this, but, nah, seems like a lot of work, you know. I think I'll try to just win the way I want. Sean, have you ever, have you read the blog post that Anon made years ago about, I think your father or someone in your family got sick and they couldn't run their factory in India anymore?

and knew how to go. Did you have to run the factory? I have it right now. His dad? Yeah, my father passed away in April 2017, and so he had a chemical business in India. And yeah, you know,

like he built it over many years. And like I was like, I can't just let it go to zero. So I ran it while I was running CBI for about 18 months. The title of the blog post is how to manage and sell a company in an industry and a company and a country you don't know. And it's kind of great.

It's like a full, like full length, sort of like, here's the whole thing. Do you want to tell like the short version of the story and then people can go read the blog? Yeah. I mean, so he died on April 17th, 2017. And as we're going to cremate him, where Hindu and this worker from the factory comes up to me in Hindi. My Hindi is pretty weak, but I understand it. And the worker was basically like in, you know, what's going to happen to us, right? And I was like, you know, I'm like a mess.

But I was like, all right, I guess like. there is this thing. And my mom and him basically built this business over 20 years, you know, kind of like a small chemical company. Like nothing. What's that mean? Gargantuan in terms of size. No, or chemical. What's a chemical? Oh, it was like a, it was, it was, it's in a sector called fine chemical. So it was a raw material that goes into perfumes and like, uh, flavors and fragrances, right? And so he built it one of three manufacturers in the world that could make this product is a really finicky product. Um, and,

And like, I'm like, all right, I guess I got to run this. And like, my dad was like a mad scientist, like off the chart smart. And I'm like, I'm not that. Right. And so, so I'm like, okay, what do I do here? Like, if something goes wrong in the factory, I can't help. So the only thing I can do is probably try to bring in more business. So I just went online and like cold called every large chemical company that's in this space.

And I was like, hey, we make this product. If you ever need it, like come, you know, come talk to us. So we had like our best couple of quarters ever when I was running it. Because you were doing outbound. And he wasn't doing any or he just wasn't doing it well. My dad was just like he was a sign. He was like a product guy. So he's like the best product will win.

Right. And like put this, put this picture up on the YouTube channel of the blog post where it's the side of the building it looks like. And it just says on one side, good quality. And then there's a giant equal sign. And then it's just this good business.

And that's like it looks. like as is that the side of the building as you approach to walk in it's like hey reminder and i was entering the factory yeah good quality equals good business and like times new roman font oh my gosh this is awesome so yeah i was just like i can try to go sell because i can't help on the technical side the team he had assembled was awesome so they've kept the factory running you know got had good sales people kept reaching out to buy it you know a lot of them like you know once somebody Once the proprietor dies, like a lot of bottom feeders show up. So I was just like trying to make sure that these weren't those people because I wanted to make sure the team landed on their feet.

And then, yeah, just navigated through it. I met a banker was representing this buyer. They were above board people. And yeah, after 18 months for a while, because I'm like insanely ambitious, I was like, oh, I'll have like CBI as a data arm and I'll have like this industrial arm and we'll build that. And then like, you know. It'd be a fucking tycoon. Yeah. Well, I mean, for it, you know, and then I was like telling my wife, I was like,

you know, we got to have more kids because like if we want to build, you got to like, you got to have a lot of kids to like take this, take all these, these arms of this industrial conglomerate up. And she's like, you're insane. And then, and then, yeah, like 10 weeks here, or six weeks here, 10 days in India. Like, I mean, yeah, like that was brutal. So then I was just like, all right, I got to sell this. And then I was fortunate to sell it. And the team's still all there. And, yeah, everything worked out. So what did you sell for? I can't disclose. A good? I mean, like a good amount? Yeah, it was, it was, you know, I wasn't optimizing for the dollars. I was

optimizing for a clean deal to a person who would not fire everybody that my dad built the business with. So, you know, so I'm sure I could have gone to somebody else who had, like, torn it down and, you know, done other things with it, but I felt really good about these guys. So yeah, I think it, like, it achieved non-financial objectives that I think were more important to my mom and to me than maybe the financial objectives. This is a really, really good blog post that you have. And it kind of got lost over the years. You guys got to share this again more.

Yeah, yeah. I mean, it was, you know, the team at CBI, I got to give them credit. I mean, I was kind of an absentee CEO for a little bit. And they like kept trains running on time. So yeah, it was a good, a good thing to accomplish. I was glad to get it. You had some like takeaways on the M&A process. I'll just read the headlines, but you can decide which one of these you think

you have a strong point of view on or strong message to deliver here. So you said, should I have hired an investment bank? And you're like, I didn't have one. I represented myself. Maybe I should have. You said, don't let lawyers run the process. So lawyers are often trying to mitigate risk, but it's easy to just like have everybody get entrenched in like, you know, risk management and not actually have the deal go through.

Don't sweat the small stuff. Quote, the industry standard is a phrase to watch out for. So give me your thoughts on one of these. The industry standard one, I think, is like the one that, like, I hate because, like, people only use that when they can't justify the term. They just say, like, oh, no, no, but that's just industry standards. How we do things. We always do things that way.

There's no such thing as industry standard, right? Like, if it's, if it's good for you, then it's what you should aim for. And, you know, it's somewhat counter to the sweat, the small stuff thing. So you don't want to negotiate on every little thing. But when I hear it's industry standard, like my. years always perk up because it's like somebody's like trying to get one over on me on this, right? Or they're just trying to like make it the sweep this under the rug. So I think that's an important one. You know, sweat the small stuff. I think like put some stuff in that you want to

negotiate on that you don't care about that you're just willing to give on. Right. But like, you know, just don't make the, you know, don't make the negotiation super painful in all regards. On bankers, like I think for this deal, it didn't make sense to use a banker. And I have, I mean, with CBI, I have a bunch of data on like what comps are and all that stuff. So I had, it was good enough. And it wasn't a big enough deal that I wanted to like cut in somebody for, you know, five, seven percent. You know, if CBI was doing a deal now, like, we'd absolutely have a banker because I,

I've definitely seen like the value of what a great banker offers. But yeah, I mean, I think the, the industry standard stuff is probably the thing. Like, anytime you hear that, I think an entrepreneur should like, just wonder like, okay, why are they just pushing for industry standard in this particular area? Because usually it's always industry standard to the benefit of the person across the table. It's never industry standard and good for you. And so that's one I would definitely push it on. Can we, one thing happened over the weekend, Sean, that you and I had talked about.

And I actually think it's a good time to talk about it now because I have a feeling that Anon's going to know a little bit about it. Do you remember probably two months ago we talked about this guy named Godham Adani, I think his name is. You know what I'm talking about? You were like, I mean, you're not to blame. We were just using the news and you were like, this guy's amazing. Look at what he's doing.

He kind of looks like an Indian Mario guy and he's like doing all this cool stuff where he's like doesn't really care about looking cool and he gives his money away, yada, yada, yada, and now he's like the third or first richest man in the world. The news was I think he had gotten to second or third richest man in the world. And I didn't think most people knew his name. I says, hey, there's this guy Adani. Here's what he does. And I think we even said it.

I don't remember really saying this, but a lot of people DM being like, you guys called it because news came out that there's like some fraud going on or whatever with their company. And I guess we had said something that was like, you know, either this is just amazing or, you know,

you never know because whatever. We have to go back and listen. I'm not sure what the clip was. But a lot of people like you guys called that, which. Yeah, people were saying that too. I'm like, I said thanks, but I don't actually remember. I don't remember calling that.

I do remember when I was reading about it was a lot of people were like, hey, this is kind of a shell game. Like he's basically raising money. He's raising money in one company using the like basically borrowing against another company that he owns. And that company is borrowed against another company that he owns. And he had like so many entities that were each sort of like the justification for the next in terms of either the valuation or borrowing money or whatever it was.

I don't, I mean, this is a couple months ago. I don't even remember what the details were, but I think we just said that as a footnote. It's not like we were calling him out on anything. People are giving us a little more credit than we deserved on that one. So sorry, to interrupt you, Sam. Yeah, so that's the background. So I think on Friday, Hindenburg Research, I think they're a short seller. So they short companies, but they produce scathing reports.

And they've done this a dozen times. I'm sure, an non-new product should probably know some of their examples. But they're just like known for these really good reports. Well, they'll write and say, this company we think is total bullshit. Here's why. And then it tanks. And obviously, they are financially incentivized for it to tank. But as far as I'm concerned, I think some of the research is actually kind of spot on sometimes.

And they have like a good track record. But Anad, have you followed this? I followed it a little bit. I mean, I like Hindenburgs. I think, like, there's, like, we live in, like, the age of grifters. And so, like, you need people. And I don't know if Adani is. But I think, like, you need people like Hindenberg who, like, you know,

or Coffeezilla or like Wendover Productions or any of these folks that are out there even on YouTube or trying to hold and at least shine a light on some of the griftiness that's out there. And so I like what they do at a high level. I don't know if they're case with Adonis like a good one or a bad one. But yeah. Yeah, well, basically they said like the entire company, like there's a bunch of weird things going on with it. Of all the, like they list all these companies. And each person that runs one of the companies is one of his like relatives or

former executive. So it's all like kind of like, uh, uh, it's kind of like his cronies are kind of like running everything. And yeah, he's like loaning money from other companies that he owns. And he's making the valuations of each of those companies really high. And so it turns out it's, so it's basically like a little FTX ask where, uh, of just like similar or entities that he owns, loaning money to other entities with the collateral being a company that he values himself. among other things. And so anyway, I thought you guys would have like an interesting take on this because,

I don't know, you had spent a little time in India. You're in the finance world. So I wouldn't sure if you had an opinion there. Yeah. No, I don't have an opinion on that. I will say like when you see like org structures that are really convoluted, like, you know, FTX or Adani or Enron before that, like people always like in the moment are just like, oh, these guys are geniuses.

They figured out how to move stuff and do X, Y, and Z. And then when you look back, it's always like, no, it was just like, a giant shell game, as Sean said, like that, that's an interesting lens, I think, to look at companies through. And it's like, innovation isn't the product. The innovation is like cap structure or some weird thing. It's like, okay, that's a weird, that's a kind of a weird business to build, right? Where like that's what you're innovating on. It's like companies that innovate in HR, right? Like, I'm always, like, you know, they're doing all these weird things. It's like, don't you have to build a product? Like, why are you doing like 3.5 days of work and like, you know,

all this weird shit. It's just like, why don't you just work and, like, build a product? So have you been able to capture or like catch any scams just or like make any right predictions based off the data that you guys have? Yeah. I mean, we don't, we don't publish that stuff. We usually send it to media, right? Because we're not like a media outlet.

But we'll find stuff where we're like, you know, this company raised at, I'm not going to name. But there was a company recently that raised like at a $4 billion dollar valuation. And then when you looked at like the founders and you looked at like the number of employees, employees and everything. It was like something's off here, right? And so, you know, and so like, we would send it to somebody and say like, hey, like this looks odd. Like, you should go do what journalists do and dig into it. So we'll find stuff that's a little odd at times. And then, you know, I think the more interesting thing sometimes is like you'll dig into filings of companies

after they've been acquired by a public company. And you see, it's not, this isn't like a scam or anything, but you just see, like, you know, hot company that says they got acquired, and then you actually see how much the public company paid for them. And it's like, you know, one eighth of what they raised, right? And so, like, you just sort of get, it shines a light on, like, what was a real success versus what isn't. I think that's probably what we tend to see more, you know, people who want to do fraud or like, if they're good, they're hard to catch, period, right? Like, it's just not something that, and it's not where we spend our time. Also, also some of these things, like the same exact signal that later you look at and you say oh man we should have known something was off like

you said at the beginning it's a sign of of the genius of what's going on like uh i know with ftx um there was a bunch of things that now people are like wow this is you know those should have been red flags but at the same time those were the things that in stories they were saying were like kind of the the remarkable things about about them like you know um for example the you know like oh, they, you know, they all sleep in the same house and on beanbags and whatever. And now it's like, oh, they had this weird, like inappropriate, you know, like sort of like group dating thing going on. But it's like, before that it was like, these are just 20 something year olds that, you know, are all like, you know, living in this hacker house that are making it happen. It's like,

no, if on one hand, it's one thing. And then like, you know, after it's exposed, it becomes labeled as another. And I've seen this with, I've seen this many times where it's like, oh, you know, same thing. Sam Bankman-Fried is this, uh, sort of like this, this, you know, this quirky genius. And then he turns out to be this sort of like, uh, you know, this drugged up liar. It's like the same thing he was doing before where he's, you know, taking whatever, you know, Adderall or whatever he's taken in order to, you know, stay up and trade. It was like, yeah, these guys are fueled by, you know, you know, Red Bull and whatever. And they're just working, you know, they're geniuses that are outsmarting everybody in the market to like their gamblers who, you know, they're gamblers who,

were reckless and, you know, we're not making good decisions because of, you know, their lifestyle and what they were choosing to do. And I've seen this, this happened before. I remember with Tesla, there was a point in time where I think Tesla had had like 10 or 15 different CFOs. And my friend had told me that because I was like, you know, I'm reading a lot of stuff online about how like there might just be like some, you know, there's a lot of smoke. I don't know if there's a fire, but there's a lot of smoke about Tesla not being in good financial shape. What are you guys? guys, you know, what do you think about this? Am I, by overreacting to these like conspiracy theorists on Reddit and Twitter? And he's like, well, he's like, I noticed something interesting. He goes,

I always have this phrase, follow the CFOs. Like, the CFOs know the health of the business. And what you never want to see was what was happening with Tesla, which was like a rotating door of CFOs that would come in for three to six months and then leave. And secondly, like the new CFO, it's like the shy 24 year old or 26 year old that's, you know, now Tesla's CFO. Wow. he's amazing. The same thing happened at FTCX. I remember when we did, they were sponsoring us for something.

And the guy who was paying us was their head of strategy. And we, you know, I didn't go on the call, but I asked Ben later. I was like, so was he like, you know,

super sharp or what was that guy's the story? He goes, yeah, he's 24 years old or 24 years old. And he started as whatever. And now he's promoted. He's like the, he's the head of strategy for all of FTX.

And again, it was like, wow, that's crazy. I guess they're just a real meritocracy around there and they just, you know, it's a land of equal opportunity and this guy just proved his worth. Or it's like, no, this is his college buddy. He's not going to ask too many questions and he can just trust him to do whatever and say whatever, right? Like these things from the outside, I remember

reading articles about this Wonder Kid and then later it's like a bad thing. And you were right about the CFO thing with Tesla at that time. Weren't they on the brink? Well, people don't talk about that much now, but it did seem like they were on the brink or, you know, just, you know, narrowly survived either properly or improperly. I'm not sure. But like later, I remember one, one interview, Elon finally admitted it. He was like, we were six weeks away from like, you know, the show being over for Tesla when they were having the Model 3 production ramp. And, and he had said something in a separate interview that alarmed me as well, which was about, there was like some, what's that famous, clean energy thing that Obama funded, like, like the Green New Deal or something?

No, it was like $600 million to soy Vera, soy lent, soy, whatever, I don't know, some co-login, I don't know what it was, some company that got a bunch of money and it failed. And like, up until the day they declared bankruptcy, it was like, we're good. I don't know what you guys are talking about. And Cylendra, that's exactly right. And they asked Elon about that, like, you know, just clean energy get a bad rap because of the, you know, the problems of Cilendra and others. People say it's hard to make new tech work and all the stuff. And he said something in a separate interview where he was like, what are they supposed to say? As soon as they, if they ever admitted any weakness, the stock would tank and it would guarantee their demise. Like they have to say, it's all good. You guys are nuts.

Whether they are or aren't, because the other one is, it will tank their stock and they will die for sure. It will accelerate their death. So then I was like, well, you can't believe anything this guy says about how Tesla is doing. If that's his mentality when they're,

you know, I'm reading these things about how they might be on the brink. He's saying they're all fine, but he even says that that's the CEO's job in this situation. So now, you know, what to do. And that's a long story show about why I sold my Tesla stock too early. I do think, like, there's the signal that I look for, it's not in the data, is like the narrative when it's like a crazy founder

narrative. Like they were in Southeast Asia, living in a monastery, and they talk about like their clothing choices. Like, that's always a weird one, right? When it's like, we're not going to talk about the business. We're going to talk about, like, we wear some, like, moleskin t-shirt made from, like, you know. Dude, but it worked with Zach. Yeah, but he wasn't, like, he built the product to start.

He wasn't known for his, like, weird. I think it's the key thing when you can't see the product or the, or the financials, right? Like, like, for a lot of these things where it's like, is the product legit and is, are the financials, like, visible, right? But even then, you can't, like, you know, FTX was a, like, a real product that people used. and the financials made sense at the time that like they were obviously going to they're making money on every trade right people doing a lot of crypto trading how can they not make money um you know it seemed like it would work in both cases another example on the ftx side they had 25 engineers and i remember reading stories about how he was just like yeah we create like we're not like these silicon valley companies with all this bloat coinbase has like you know thousands of employees we have a whole engineer team of 25 and we do more volume than them because we hire 10 xx000 engineers and we go for extreme operational leverage. And later it was like, of course these guys had like terrible security practices and all the

stuff. Like they didn't even have the, they refused to even invest in engineering, right? It's like the same story, the two sides of the same story once you know the result. Yeah, 100%. I do think there's signals when I, I don't think fraud, but there's signals right now that companies are not doing well. Right. So like you'll see companies raise at a billion dollar valuation.

when we dig in, we see like the liquidation preference is 3x. But that stuff doesn't get reported, right? Or you see the CRO or the CMO leaves every six months, kind of to Sean's point on the CFO. Like that indicates there's problems. It's not fraud. It's just like, hey, this company's not killing it the way outsiders might look at it. I think fraud's a tough one. I think underperformance and companies that are not doing well, that's a lot easier for us to figure out.

What's a company that's impressed you that we, most people don't talk about because you guys see a bunch of companies that are interesting. What's a company that kind of flies under the radar but kind of secretly crushes it? I'm like a dad. It's probably going to end up in the data world. So let me think of it's right. I don't know if anybody, I will say like the area that I like right now, and I don't think these are great businesses, but I think like are interesting is like the folks that are analyzing the grifters, right? Like I really like love this space because I think there's something.

thing to be built here. Like, they're more media companies than they are great big tech companies. But there was like, there's a couple that like are deeing into like pastors and like the whole like evangelical pastor world. And like it's phenomenal like the stuff that they do. So like that's probably the area I go down a lot more in. And then like looking at the businesses of folks like Andrew Schultz and folks like that like, you know, because I think there's a lot to learn from how they do marketing and how they build audience. So I tend to look at businesses that I think, we can learn from versus like just like random sort of businesses that are out there. What what can a boring company like yours learn from Andrew Schultz?

So the thing that so I think the thing that he's done really. I was purposely insulting you in order to make make the average listener be like, oh yeah, I'm not that cool. I think the thing that he does really well is he doesn't just interview other comedians, right? I think he like he interviews other people who are kind of adjacent to him, right? And so what he does then is he keeps expanding his audience. And I think most other folks like, you know, like I like Theo Vaughn.

And Theo Vaughn's like interviewing other comedians, right? But like he interviewed Neil deGrasse Tyson. And I bet you that brought him a whole bunch of new people. And so I think it was very funny. Yeah, it was awesome. And so this sort of like Schultz strategy of like adjacent folks, I think is really smart to bring in like the Venn diagram is not as heavily overlapped. And I think like he keeps building that way, which I think is really. interesting. And so for us, like, it's always like, who has an audience that's not exactly

our audience, but that has maybe a slight overlap. And would those people kind of like us if they knew about us, right? And so it's kind of like thinking about partnerships there, whether it's newsletter partnerships or whether it's, you know, research that we do, whatever it might be. So, yeah, I think like looking at what's happening in the consumer side of media is always interesting, because that's where, like, the innovation tends to happen. It doesn't usually tend to happen in B2B. Well, dude, I appreciate you doing this. You're fun to talk to. Sean, what do you think?

We only got through maybe half of the short list ideas. So if people like this, we should do a part two and do more, do more of the ideas. Thanks for coming on, man. This is fun. And appreciate, you know, that you've been, you know, come. I feel like I've seen you tweet about the show, you know, for a while now. So, you know, that's, I really appreciate that. That's one of the cool moments of this doing this for us.

that people we respect if they like our stuff too that gives you a little extra juice a little extra wind in your sales to to go out and keep going because it's it's different than just oh the numbers are going up but numbers don't have that same kind of like pull as you know somebody who you think is cool you know liking your stuff and by the way anon it's your fault it's kind of my fault it's most it's part your fault basically i get like lots of messages a day but like five of them a day it's usually a young man in his 20s, and he'll just message me and he'll say, let's fuck. That's all I get. And the reason being, one time I was either on my way home or en route to the airport. And I was I hate flying. So I take a lot of Xanax. And so that's the only time I'm ever inebriated. And I was

very high. And I messaged you and I said, I'm in your hood. Let's fuck. And you replied like, I'm down. Like here's a restaurant, meet me there. Or something like. that and I told that story and now because of that I get I get a bunch of men messaging me that of living the dream Sam you're living the dream someone's dream someone's dream not my dream but someone's dream yeah I'm living I'm living on person's dream so you're to play for that but I appreciate you coming on and this is fun we'll talk soon All right. Thanks, guys.