My First Million - The Boys React to the News: The New Theranos Scam, Crypto Rally, and Gas App Sells to Discord

Episode Date: January 20, 2023

Episode 409: In a new segment called The Boys React to the News, Shaan Puri (@ShaanVP) and Sam Parr (@TheSamParr) give their two cents on a few relevant business stories. Check it out... ----- Links: * Gas * Nikita Bier * Tonic * Unsellable NFTs * 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: (01:53) - Discord acquires Gas app (15:00) - JP Morgan and Frank (21:50) - Is crypto back? ----- 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

You got caught. Okay, you got got. And, okay, I think we should create a set of the Forbes 30 under 30. I think we need like the Madoff 1000. We're all the grifters and con artists that are out there. All right. We don't normally let Ben have ideas, but we let the man out of the cage. He's got an idea of Ben.

You texted us this morning. You want to try something. What do you want to try? We're doing a news segment, fellas. We're just going to, we're going quick through the news and we're having you guys react. People want to know what the fellas think. about what's happening. So we're going to, we're going to find out. We're call it. I'm going to call this the boys react.

I've been trying to make this the boys thing, a thing for a little while now. And it hasn't happened. But as I taught my daughter yesterday, we never give up. And so the boys react is going to be, we're going to react to the news here. So Ben, you have some news segments or news stories, I guess. And Sam, Sam actually likes the news. Sam, Sam's into the news. Dude, I read the news. news like crazy. You don't read the news? I'm an anti-newer. I just love drama. You know how how some level are preppers? I'm like whatever that is where you avoid the news at all costs.

Yeah, I just like gossip. I'm a big fan of drama. My life's pretty boring. So I need, I need drama. I love the comment sections too. Somebody said this the other day. I think it was like Naval or one of these smart guys. They go, the goal of the media is to make every problem your problem. And I was like, Oh, that's pretty true. That's kind of like what the news is. It's like, oh, there's a flood in this county I don't live in. Shit, let me watch this for 20 minutes. Why do I care about this?

There's nothing to do with me. All right, but anyways, sorry. Let's start. Let's start with the most interesting one, Ben. What is it? We're starting a little close to home. Your friend Nikita Beer, his social app, gas, was acquired by Discord for an undisclosed amount. What do you guys think about your buddy Nikita being acquired by Discord?

Give the background, Sean, about this guy. Like, because it's a pretty, it's a caper. I call this a caper. I don't even know what that means. A caper. It's like, uh, what is that? No, a caper. It's like a, uh, a scheme, but like, uh, it's like when you would rob a bank, you know,

you'd like, this is a great caper. Fool me once. Shame on you. Fool me twice. Shame on me. He just fooled the tech industry twice, dude. He sold the same app. So he built an app called TBH.

That was like, you know, let a teenager go on and it would basically quiz you about people in your school, your friends and be like, who's the most cute boy in your life? And you're like, oh, Sam. And it's like, who's the most likely to be famous? Oh, it's Ben, right? You just do that, right? And then they would text them and be like somebody. And this is eight years ago. Yeah, somebody said, you're cute.

Download my app. And of course, that shit worked. He did that. And like, it immediately went viral because it went viral. Facebook buys the thing because Facebook has like a system internally that says like, viral teen app and then it's like must acquire viral teenage app

you know like get that young blood in here and so they acquired it people had said $100 million I don't know it's not $100 million dollars but but I think something more like 30, 40 million bucks and um

and this was in 2017 he sells the app promptly the app gets shut down within like a year because there was never any retention in this app. He then said, sits at Facebook for four years and vests out the entire every cent of his earn out,

which is just hilarious in its own right. And all he did was just tweet all day. You know, like, he worked in the new products division and, you know, half released some apps, I guess.

And then he leaves, you know, what's it called recidivism? Sam, you're a prison guy. He leaves the jail of Facebook. And he does the same goddamn thing again. He creates another teen app for complement.

He tells us this in advance. He goes, yeah, I'm just going to make an app that makes like $10 million in three months. And we both kind of laughed it off and we're like, is that even possible? And then he pretty much did it. I think gas app has made $7 million in gross sales in like three-ish months. So, you know, pretty much called his shot, which we do respect. But also, we have to clarify one thing, Sam. Ben said he's our friend.

Is he still our friend after how insufferable? he is in the group chat. So he is insufferable, but I kind of like it a little bit. I think it's pretty hilarious. I love a good troll. I think that you're missing some of the data here. So he sold a company to Discord. There's no release on price or anything like that.

But some people can make guesses. But basically between leaving or being at Facebook and Discord, he creates this mystique. I call him the Jewish Great Gatsby. He creates this kind of mystique where he's got this really lovely home in L.A. He's single, or at least he's not married, and he, like, hosts really fun parties. And then he posts on Twitter about, like, his opinion on going viral and all, like, legends, like, or quote, legends start following him. And they, like, message him. And they, he's created this aura of sophistication and of, like, he knows what he's doing with apps, which is true.

It's all true. He's very talented. but it was pretty cool how it was like kind of systematic. So he has the talent, he has the skill, but he did a great job of also flexing that he had the talent and he had the skill. And people start flocking to him. And he starts launching this thing.

And here's the analogy. He's like the guy who moved to a new high school as a sophomore and then didn't try to make a single friend. But he just went to lunch and he was just totally content sitting by himself. It wasn't a loser. He was almost too cool to have. have to try. And because of that, everyone's like, who is this guy? Does he have a, is his girlfriend in college? Oh my God. And he would just be like, you know, texting his college girlfriend.

That you don't know if you know if they exist, but he just built this aura, this mystique around him by almost not trying. Whereas everybody else on Twitter is like, hey, follow me for more threads about how great I am. Right. And he's, he's trying to do the exact opposite where he's just like only shit posting and, you know, just hinting and posting little screenshots that make you think he's up to something big at all times. Yeah, you're like, who's this kid coming up to school as a 16-year-old in a motorcycle? You know, like, this guy's got a neck tattoo. Like, I can't confirm that he's a badass, but like all signs point to it.

That was his thing. And he never, he didn't deny it. He didn't confirm it. So it could be true. It could not be true. But the fact is, is that he created this app. Something happened to it. Like, there was a crazy rumor with the app that it was used for child sex trafficking, which

wasn't true. he changed the name of the app. Then he changed the name again, a third time. And it takes off and he sells it. We're recording this on Wednesday. I believe it was announced yesterday. This is a wonderful caper. Not to say that Discord didn't get value.

I have no idea what the truth is. The truth is probably like they're going to make something cool of it. Who knows? But he pulled it off. He called a shot. He pulled it off. And he did it in such an obnoxious way. And that's why I love him.

You know, I love guys like that. I love what he did. And honestly, I love the way. he did it too. But the problem is he's like a fart. A fart is amazing when you're more than six feet away. But you don't want to be too close to the fart. Like,

the fart's not funny when you're right up against it. And so that's the problem with this is we were too close to it. We got to hear him. And he loves smelling his own scent. He loves smelling his own fart too. And so, you know, he will in our group chat just post every like Twitter mention where somebody's like,

oh my God, Nikita has done it again. Oh, my God, Nikita is the best. It's like, bro, I don't need your Twitter mentions posted here, you know, for me, for me to see. It is completely, he's an insufferable fart, but I do respect what he's pulled off. Yeah, it's pretty funny. So this is like an interesting thing. I can't believe he pulled it off, but he called his shot.

I respect that. I think it's cool. Also, he's done a thing. Like, you know, Mr. Beast does this thing where like, if you go talk to a pretty serious business person, they will, like, reference a Mr. Beast, like, a Mr. Beast is him. where they're like, well, Mr. B said,

yeah, Jimmy just says, you know, we just try to make great videos. As if like nobody else tries to make great videos or he'll be like, or he'll be like, you know, we just,

we're willing to put more into our content and trying to make the best content possible, blah, it's like, and then if somebody goes and looks and they're like, bro, you, you, your video is put your hand on this car and the last person to take their hand off,

you know, last person with their hand on the car keeps the car. Like this is not like, you know, you're not Steven Spielberg over here. But didn't we talk about this where we're like, look, we're going to do this thing and we're going to send them a welcome letter. And we're just going to make it really delightful. It's just going to be a beautiful. Really well done, just beautifully done.

And if you do it like that, people start to buy in. They start to eat that little puppy chow. And so similarly, he, Mr. Beast does this reality distortion where he makes you believe that he is the deepest thinker. He's creating the most epic, beautiful, well-done content. He is a really thoughtful. It's just so thoughtful. It's like, you know, watch me fart in people's ears. It's true that people, I'm on a fart kick today. People, people do like it. The content definitely works, but it creates this almost this mystique around it. And I feel like Nakeda did the same thing where he'll tweet out shit where he'll be like, um, just move the butthole a little closer.

They'll tweet out like, you know, the, you know, the underrated metric and social networking is density by far more important than spread. And he's like, you know, like, if you're still measuring K factor, you might as well still be using a Blackberry, right? And he'll tweet out shit that makes you think like, damn, this motherfucker knows shit that I don't know about social networking. Or he'd be like, there's only five people on earth that can tell you about building social networks. The problem is they're all unhirable because their names are Mark Zuckerberg, Jack Dorsey. and Nikita Beer. So, and so by the way, I think there's levels to this. There's levels.

So I think he does a great job of creating. It's like, bro, you created a app that lets me say which, which girl in my high school is the cutest? And then it texts her, somebody said you're cute, right? Like, yeah, there's beauty and the simplicity for sure. But they almost make it sound more complicated and artistic than it really is. And trust me, it's not. We're not like every other social app. You see, we're changing the world one popularity contest at a time.

We're democratizing popularity. He went on on like CNBC or one of these like news networks or whatever. And they were like, we have here the founder of the hit teen app, the sensational app. Yes. Nikita, what inspired you to do this? And he's like, we know, we just believe that teens, the world needed a little more positivity. and that we wanted to create a safe space for whatever. Dude, the only safe space he wanted,

was a vacation home in Tahoe. Exactly, exactly. You wanted to, you know, you wanted to fly private. That's what you wanted. Hey, mission accomplished. I respect that. That is amazing. Yeah, his next app's going to be called plebe.

But in all seriousness, he pulled it off. I think it's cool. Yeah, I make fun of them because, because of how obnoxious he's been for four months in this group chat, but deep down, he's my kind of people.

I respect what he's done. And I also respect the massive troll that he's played on everybody here. So this is good. Speaking of trolls who didn't pull it off, Ben, we got to get to the next story.

Before we get to the next story, though, we do have to remind everyone, we have a gentleman's agreement here. Everyone follows it. If you listen to us, it doesn't matter what app

you're listening to, you have to go to our YouTube page and you click subscribe. That's the gentleman's agreement. I have my pen here. Am I going to need this for the gentleman's agreement? Do I need to sign something or what do I do? You actually don't. See, all you have to do is go to our YouTube page and you click subscribe.

You don't even need a pen. That's how easy it is. We made this gentleman's agreement incredibly simple. You go and you subscribe and then we work for you and we make this content for you and we reveal our life and dedicate our lives to you. It's simple. That's the gentleman's agreement. 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. Next topic.

Ben. From someone who pulled off a caper to someone who did not, J.P. Morgan Chase bought college financial aid platform, Frank, for $175 million. It has now shut down the website and claims that they fabricated more than 4 million accounts on their first email to their customer list. They got a 70% bounceback founder Charlie Javis, I think it's pronounced. denies that this is fraud and claims that J.P. Morgan is just inventing reasons to not pay her. Fellas. Boys, who do you believe? Well, J.P. Morgan. This lady was on, like, that's easy.

This lady was a Forbes 30 under 30 and then just like a couple years later, sells her app for nine figures, 100 million plus. And it's pretty hilarious. They even found, they tracked it down, I believe, where they talked to the developers. It was a, it was like a, they hired one freelancer, I think, who they said, hey, can you like make some test data to put in here? And he starts doing it. And the guy was like, I think this is fraud. I'm out. So they found those emails. And then they did it again with another contractor and who actually did do it.

And they convinced the contractor that it wasn't fraud. And so they've kind of like honed in on this that it seems quite clear that it's fraud. Bold move. Very bold move. Very easy to catch so. Really stupid. Like this seems like really a foolish mistake. Yeah, this is like,

JP Morgan's got a little egg on the face for not noticing this because this is pretty easy to notice. I mean, the fact that they sent one email and 70% bounced back, right? Like that sounds like it wasn't this really sophisticated, you know, botnet that, you know, was simulating real users. It was just a bunch of fake emails in a, you know, in a database. So, you know, that sounds pretty easy. And also it says, there's an email with where she's asking the professor who ended up doing this.

Will the fake emails look real with an eye check or is it better to use unique ID? Right? So like, you know, handed the cookie jar, as we say around here. You got caught. Okay. You got got. And okay, I think we should create a set of the Forbes 30 into 30. I think we need like the Madoff 1000.

you're all the grifters and con artists that are that are out there. You know, I think that, you know, maybe the caper 20 or something like that. We got to come up with something here and we need to just annually, I think we should just do a show where we just rank the best cons of the year and give them their due. Let them put that on their bio. Dude, I'm down. And what's crazy is this is so, so when I sold the hustle, we had, I think, 1.7 million subscribers. we used this service. HubSpot paid for it, and it was a service. I forget the name of it, but I believe it did two things. We uploaded our whole email list, and then I think HubSpot

uploaded some of their email. I don't remember exactly how it worked. I think they did it. And it showed the crossover, like how many we each shared in a huge amount of emails. I imagine HubSpot has like hundreds of millions. I have no idea. A lot of emails. And then I also think it checked for fraud. And it was like a couple of days to do this. It was pretty simple. There's just a few other services where they make fake data. And the reason they do this is if you have a sensitive thing like a bank startup, you put a whole bunch of fake data in it and it like makes up people and you can test your data because you can't use like, you know, obviously real social security numbers when you're testing certain things.

And they would make up fake stuff just to test the software, make sure it all works. Tonic, I think it's called tonic.a.i. It's the, and then it says the fake data company. We talked about them on the pot. I love this idea. I've been trying to invest. I forgot. I need to invest in this. Yeah, I think it's a cool thing.

And so also with GPT3, whatever it's called, I was like thinking, I'm like, dude, I should just, I'm not going to do this, but maybe. I was like, I should just make up fake reviews for all of my, like, products and you can just like make up fake reviews or you can like make up negative reviews for all your competitors products. But I was like, are you looking for a nomination to the Madoff 1000? We'd be happy, have you? But you do need to formally submit the application. Put my application. We have to make everyone pay a $500 application fee too. Right.

If there's no con going on on our side, what are we doing here? Yeah, yeah, yeah, yeah. Well, don't you want to win the award? It's an award. We did a thing with Milk Road where we had this philosophy, which is like, we should bank that in the future we're going to cut out all advertisers and be our own advertiser. I mean, only promote our own product or our own service in this newsletter.

that's the only way to hold yourself like accountable to not just acquiring like shitty subscribers. And so we had started this new growth channel. We're like, oh, let's try this thing out. We heard the rates are pretty good. We tried it out. We tried it for like a week. And we're like, oh, the numbers look pretty good. We're getting cheap signups.

They're opening the email. That sounds great. And I was like, hey, Ben, just for just to double check here. Why don't you just email all those people that signed up? And just ask him like, you know, a simple question. Like, you know, hey, ask them a one line question. That would be trivial for them to answer just to be like, hey, I just wanted to know blah, blah, blah. I'm the founder of this thing.

Just wanted to know blank. Because they're opening the thing daily. It looks like. Okay, fantastic. Surely they would reply to an email from the owner of the thing they read every day, right? And he was like, dude, guess how many? I forgot how many. There was like a couple thousand people on this thing.

He was like, guess how many people replied? I was like, well, you didn't say percentage. So, man, this is a number of people who replied. I was like, I don't know, like 400 or 500? and he was like two we got two replies turned off the channel it was like wow and i know a bunch of other people that are still buying from this trap this like you know this uh this marketing player this traffic source and i'm like well they're they're just dumping money down the drain if they're doing that dude seeing uh billy mcfarland and the thranos lady go to jail um like this woman potentially

could go to jail it's pretty crazy that like what do they not think like like just like eight months in advance. It's like, man, this isn't like internet play games. This is like go to prison games. This is really screwing up. A hundred plus million dollar acquisition and 70% of the users were fake. That is crazy. You go to prison for that type of stuff.

That is wild. And it's just crazy to think that no one's there. And they're like, Charlie, you know, like, are you, do you like generic Oreos and bologna sandwiches? If yes, then this is great because that's what you're going to be eaten for like the next nine months in prison. Is they get generic Oreos? That's nice.

Well, not when it's every day and watered down Kool-Aid. But like, it's just, it's pretty wild that people don't think ahead. But this is such an obvious scam. Also, J.P. Morgan, you guys suck, man. You guys got to be on top of the ball. Like, this is such a, this seems pretty easy to figure out. Yeah, fair enough. All right.

What's next? All right. Bitcoin and Ethereum are up 23%. over the last week. Crypto is rallying. One major cause is continued rise of inflation, 6.5% annualized in December. The question for you, fellas, is crypto back? No.

You want to just end it there? I don't. Well, I will give you. That's a great answer, Sam. I will give you a slightly different answer. Do I get to say like I told you something? No, I don't get to say I told you so. In fact, I maybe take the other, the other L.

Did I sell milk road too early? Did I sell the bottom? No, I think that a lot of things are rallying right now. Why? Because people did, I think it's just a simple answer. People did an end of year sell-off in December for tax loss harvesting. And a lot of people will re-enter. And then that creates some upward momentum.

And when there's upward momentum, that makes people think, hey, is it coming back? Is this the rally? did we do we at the bottom is it time to buy back in and so people are buying back in i don't think it's because inflation in december because guess what we hit inflation in october and november and september and now i guess too like where was you know if if inflation was driving crypto up it should have been up all year last year not not down and so i don't think that that narrative holds i think it's much more likely that the same way that tech stocks are having a little brief rally it's kind of like New Year optimism, people being done with their kind of, like in crypto,

there's no wash sale rule. So you could sell, book the loss for tax purposes and buy back in one minute later if you wanted to. And so I think people are just buying back in. And I think there's a little bit of people chasing momentum. That's my guess. Have you ever looked at the correlation between G-Wagon prices, use Rolex market, and Miami penthouses and how it relates to crypto?

I have not. I have not. There's got to be a correlation there. We got our best data people on it. Did you see? Yeah, Ben, Google that. Did you see, I'm just going to start telling Ben, just in Google random stuff that are ungoogulable. Did you see that there was a guy in, like, you know how we have this Facebook group for MFM that we don't really check often? But there was a guy who was like posting in it a bunch.

And he created this website where you can sell your NFT at a loss for tax purposes. It's kind of interesting. It was a great idea, honestly. What's it called? I'm going to forget the name. Ben might actually know it. It was called. They advertised in the Milk Road,

so I remember seeing it there and being like, oh, wow, this is actually a great idea. Hold on, Ben just type of in chat. What did you say? It was like a really, it was like a white guy with like blonde hair. It looks like. Unsellable.

What is it? Unsellable NFTs. Yeah. Yeah, that's it. Unsellable NFTs. And so basically, if you wanted to book a loss on your NFT, they would basically,

let you instantly get liquidity on it and get it right back, I think, is the idea, which is just a very useful, simple tool. So, you know, get on that guy for creating that. That was a smart, smart idea. So is this the segment, Dem Boys, Dem Boys React? Is that it? I think we're not ready for Dem Boys. I think we're still the boys until we get a little more street grand.

Go to the YouTube comments and tell us, is the boys going to stay? can I make it a thing? Because I sure would like that. Just type it, a thing or not a thing in the comments. I just want to, I'll read the poll. And if it says not a thing,

I'll only continue for another three or four years. If it says it's a thing, I'm totally validated. All right, that's it.