My First Million - This $50M/Yr Side Hustle Is On Track To Make $1 Billion By 2030

Episode Date: June 3, 2024

Episode 592:  Sam Parr ( https://twitter.com/theSamParr ) and Shaan Puri ( https://twitter.com/ShaanVP ) break down the economics of luxury hobby magazines, make a prediction about Ai cameras, and explain how to find the next tech wave.  Want to see Sam and Shaan’s smiling faces? Head to the MFM YouTube Channel and subscribe - http://tinyurl.com/5n7ftsy5 — Show Notes: (0:00) Craig Fuller's field of dreams (5:12) $50M side hustle (9:16) We call to find out EXACTLY how he did it (19:02) The New York Times is a gaming company (23:27) Idea: Third party LinkedIn games developer (27:00) How rich people spend money (29:00) The myth of the second home (30:57) Ai cameras (36:31) Prediction: A camera on every field, every court (38:31) How to find the next wave: What's the next menus on the internet? (40:41) How to avoid product obsolescence (44:09) "Measure twice. Cut once" — Links: • FreightWaves - https://www.freightwaves.com/ • FLYING Magazine - https://www.flyingmag.com/ • Firecrown - https://firecrown.com/ • Veo - https://launch.veo.co/ • Grab HubSpot's free AI-Powered Customer Platform and watch your business grow - https://clickhubspot.com/fmf — Check Out Shaan's Stuff: Need to hire? You should use the same service Shaan uses to hire developers, designers, & Virtual Assistants → it’s called Shepherd (tell ‘em Shaan sent you): https://bit.ly/SupportShepherd — Check Out Sam's Stuff: • Hampton - https://www.joinhampton.com/ • Ideation Bootcamp - https://www.ideationbootcamp.co/ • Copy That - https://copythat.com • Hampton Wealth Survey - https://joinhampton.com/wealth My First Million is a HubSpot Original Podcast // Brought to you by The HubSpot Podcast Network // Production by Arie Desormeaux // Editing by Ezra Bakker Trupiano

Yeah, actually call them right now and put on speaker phone. Yo. Preston, you're live on the podcast right now. What's going on? I feel like I can rule the world. I know I could be what I want to. I put my all in it like no days off on a road. Let's try.

All right. We're live. Sean, I've got a weird thing for you. Do you remember like 12 months ago, I told you about Craig Fuller? You know who Craig Fuller is? Yeah, he's freight waves, right? Yeah, so freight waves, it's a data problem. for people, I guess, who are freight brokers, something like that.

And they're pretty big. For some reason, if they run their company like they're publicly traded in that you can Google them and see all their revenue and profit. And so I don't know the exact numbers, but you guys can just Google a freight waves revenue. And they put out like quarterly statements, which is interesting. But it's like a large like $60 or $80 million a year software business or subscription data business. Anyway, Craig is an interesting entrepreneur.

And I told you about how he bought this thing called Flying Magazine. And what he did was he was a big fan of flying. And he's wealthy on paper, but I don't know how wealthy is liquid. And so I think this was like a big deal for him. But he bought Flying Magazine. And then he also bought a $7 million like 300 acre plot of land in Tennessee and was turning that into basically a flying club where you, it's kind of like a country club where you like an own a home on a golf course,

except now you own it around an airplane strip and an airplane hanger. And they used the magazine to sell. plots of land. It was like a neighborhood and basically they were like, you could buy a house. It's going to be, you know, the middle of this neighborhood is basically the air strip. So we're going to be able to take off if you, if you like, you know, either flying your own plane or private, private flights. And so they were like, we're going to, that's the vision. That's the field of dreams. We're going to start doing this. And I think it was working extremely well. I have an update. I will tell you how it's going. So Craig has now acquired 30, sorry, 44 different

magazines. And they are going to do roughly $50 million this year with 18% EBDA. And it's his prediction by 2030, this side business that he started, he says, I think we can get to a billion dollars in revenue with 30% profit margins. And so that's an update on this guy, what he's doing. And he tweeted out recently his quarterly revenue. I think last quarter, Q4 of 2024 was 15 million in revenue. And he's doing it profitably. And here's what he does. So he finds an old title, like an old magazine, where it's around a expensive hobby. So I think he has a boating one. He's got, I think he is even looking at like RC planes and RC cars and things like that.

So where there's an expensive hobby. And he uses this thing that he calls negative cack, meaning people pay for the magazine. And so that is how he acquires a customer. Of course, they are paying for the magazine, not him trying to advertise. to get the user. And then he goes, I want to create commerce products to sell to the audience. And so the media businesses pay for the company. They pay for the audience creations.

And then they help bootstrap other businesses that can sell to this audience. And at this point, he's buying companies for three to five times EBITDA, which is, I think that's pretty cheap, but it's a dying, it's a dying medium. So maybe that's not that cheap. It does require some sophistication in order to like turn them around. But it's really fascinating that he's pulling. this off, and this is his side, like his side hustle. This is his side business. His main business is freight waves. Well, a couple questions. So he bought this personally not,

it's not a part of freight waves. No, it's its own thing. So that's why I said it was like kind of a big deal for him, because I don't know Craig's personal situation, but I don't think he sold any of freight waves other than taking on venture capital to build the company. This is wildly impressive. So first of all, it's called firecrown. So firecrown.com, and you could go to their brand section. You can see all the things that they bought. Firecrown, great name. They've got 44 brands. You write basically it's a bunch of things about private flight.

It's a bunch of things about boating and sailing and fishing and yachting and wakeboarding. And then there's things like classic toy trains, garden railways, trains.com, and then some like astronomy stuff as well looks like. So this is a lot of things that he rolled up. He must have found a kind of repeatable rinse and repeat model. It says here that he buys. them for 3 to 5x EBIT as his typical range. And was he using debt?

Was he using revenue from the business? What was he? Are cash flows from the business? How was he buying these? I think he got a bunch of friends to invest, but I don't know exactly. He's going to come on the pot. I asked him to come on to explain this strategy. But what he did was there's a bunch of companies that own tons and tons of magazine

titles. So Meredith Corporation owns like Martha Stewart magazine. And then I think there's like Rodale and then there's Bonner. And there's all these companies that are like old family companies that have been in business since the 30s or 40s, whatever, and they've got these publications that are just sitting there and they're like, just take them.

And so he could buy them like five or ten at a time. I think he's tweeted out that he's bought like 13 the other day. And so he buys them in bulk a little bit. I mean, this is super impressive. The side hustle that's now 50 million a year, profitable, really, really specific, you know, expensive hobby magazines.

And then basically he has a better business model, sounds like, right? So it sounds like the old business model was, it's a media business. So we make money on the media. He's like, no, no, it's a media business. So we're going to use media to acquire customers for a much more valuable business model. For example, with the flying thing, you know, they're selling these homes on this plot of land for like a couple million bucks each. So I think you said what, seven million bucks to buy that, that 300 acre plot of land? Something like that. Yeah. So roughly, you know, let's even round it up, 10 million bucks to buy the thing. But then they're selling each home at $2 million.

They sold 50 homes, right? It's just rough numbers. I don't know how many they sold, but they sold enough that it's worthwhile. And it's a beautiful piece of land. And on Flying Magazine, they're also, if you follow Preston Holland,

he's the CEO of Flying Magazine. He's brokering jets. He's selling jets. On Twitter. Yeah, on Twitter. He goes, we've got this jet for sale. It's $7 million.

He's a good dude. We text all the time. And I'm like, he almost gets me to buy a plane. I'm like, dude, do you stay away from me, man? I'm not going to buy a plane just because you, you know, you made a funny joke in this day. Dude, Nick Huber, I'm going to do it.

This is a Hampton plug. Nick Huber and Craig are in the same Hampton group. They bought a plane together. And so now Nick owns a plane. I guess they like, I don't know how you buy a plane together. They did it. But Preston's selling these like $10 million jets online. It's on Twitter.

It's crazy. Nick shared the economics of buying these small planes, by the way. We should ask him for permission to, share the numbers. Like, we bought it for X. Here's how much it costs to do each flight. Here's how the rules work. Because it's kind of a time share. It's like him and six other guys or whatever, bought the plane. And so you pay for like the pilot

and the fuel when you need it, but then you just pay an ongoing basis, but then you got this tax benefit of buying a plane. And so how does it all work out to? What does the cost per flight ultimately work out to? He's shared the numbers with me before. So we should do a segment on here talking about that. But isn't this crazy that this is this guy's side thing and how amazing it is.

It's pretty insane. It's about to be his main thing is what I'm hearing. Well, what's crazy, here's kind of a takeaway, which is, all right, so most people couldn't imagine this being their main thing. When you get into business like him and you have some success with freight waves and you start seeing like how things work, it's like you get these like weird like unlocking moments where you don't see certain things as risk. So I've never bought a business before.

I see buying a business. I'm like, that's really risky. But he's like, no, like I've done it enough times that I know how to, unlock value. And I don't think this is risky because we're going to do this, this, this, and this. And it really is a confidence game as much as it is a knowledge game. But it's pretty amazing how we've been able to pull this off.

I'm super impressed by this. This is one of my favorite kind of like businesses that you brought to the pod, to the people's attention. And really, really impressive what he's done. So where do you think this goes? What do you think he's going to do? And what does he do for the boating ones? Like, is he doing the same thing?

He's selling boats? Or what is he doing to make the business work out of those? I don't know. I mean, he doesn't know yet. I don't think he knows yet. I'm not sure. He hasn't shared it publicly. But I guess you could do similar things where you have a marina.

I mean, have you ever like my parents who's had boats? And I know that they would spend like $500 to $1,000 a month on a boat slip rental. And it became a community where we would hang out and stuff like that. Something like that. I'm not sure what he's going to do. Selling boats. I mean, I'm not sure how he's going to pull it off. But there's like plenty of options.

Should we call this Preston guy right now? Just get him on here. to explain this? Yeah, actually, call them right now and put on speakerphone. You're live on the podcast right now.

What's going on? Dude, we are talking about flying and we're talking about Firecrown and I'm blown away. I didn't know about firecrown. I only knew about flying and Sam is telling me about the growth of this thing.

I got two questions for you. Number one, when you guys started this, was this the plan or you guys sort of stumbled into oh wow, this might be bigger. and better than we thought.

So when Craig called me in 2021, it was a lifestyle side help, basically side hustle. He's like, hey, you want to come up and we run this? I asked him, I was like,

why are you buying a magazine? I can't tell you the last time I read a magazine. And he was like, well, it's just going to be kind of like a side hobby. Freways is really my business, but, you know,

keep it small. And, but if you know anything about Craig as a person, he, that's not in his nature. So all of a sudden, we started rolling stuff up as we saw opportunities. And now it's ballooned up into, I mean, we're 257 employees. The side hustle has 250 employees.

All right, amazing. And can you give a little bit of the peak of the, because Sam has a bunch of the numbers of firecraft because I think Craig tweeted out. But can you talk about the thing you guys did where you basically bought the land and then you started building a neighborhood on top of it? So really what we did was we let the content inform the commercial decisions that we made, right? So we had an idea to kind of build an airport. We're like, that'd be cool.

You know, it's hard to find hangar space around Chattanooga. And so, you know, as we're looking at all. I always tell myself that too. Where's the hangar space in Chattanooga? Yeah, right, exactly. So we've got three airports and each of them have a waitlist of like seven to ten years long. And so we're like, well, I guess we're going to have to build an airport if we're going to be able to get hangar space for any airplanes, you know, that we get on demo or whatever. We wanted to build a media center on the runway.

And, you know, every airport was like, yeah, good luck. It's going to take at least 10 years. So we said, hey, let's build our own runway. If we build a runway, we should, you know, do something unique. These flying communities are interesting. And we started writing about it and realized that, like, there's really, high-performing content. Like, user, you know, from a Google Analytics standpoint,

it's like, you know, we could see that the content being engaged with. We're like, okay, people actually care about this. They care about air parks. So we said, okay, well, let's go ahead and let's build an air park. We announced it. On the land, 50 hundred acres, about 45 minutes outside of Chattanooga, Tennessee. And through advertising in our own magazine and said,

all right, well, this will probably be like a five-seven-year project before we get started, you know, kind of underwriting. And we had, we basically met our three-year kind of perform in pre-reservations in like the first three months. So we're like, all right, there's definitely demand here. And so, yeah, so we're set to break ground. We just finished some regulatory stuff that the government loves to tell you where water should go.

And so we just finished that and are set to break ground probably. here in the next 30 days. Can you give us a sense of the numbers? What can you share on the numbers? So, like, how much you guys buy the land for? How'd you finance this whole big construction endeavor? Yeah, for sure. So we bought the acreage around $1,500, $1,500 in acre.

So it was really cheap land. It's also in an opportunity zone. So there's a lot of tax incentives for making investments in that area. and then we are, we've taken $25 million of pre-deposits so that's people basically sending us a percentage of the deposit. You basically funded it through the pre-the deposits.

Kind of like how Tesla does with the trucks and all that before they, before they build the trucks, they take the deposits and they use that to basically finance the manufacturing. If you've got those deposits, it proves to the banks. You can go to the bank and basically say, okay, look, we've got, you know,

$25, million of these lots pre-sold. So that represents future cashels of $25 million. And they say, oh, okay, so let's say, using round numbers, let's say round one of infrastructure costs, I don't know, 10 or 15 million dollars. The bank's going to go, okay, well, you've got $25 million representative of future sales.

So that, you know, 10 to $15 million of phase one infrastructure is a super low risk bet for that. Nice. And then are you guys bootstrapped or did you raise money to buy all these magazines? How did you do it? Yeah. So we have, we've been really fortunate. You know, since we've got some private capital behind us, it's patient, which is really key, right?

It's not venture. It's more, you know, patient capital that says, okay, you know, we're going to take a 15-year time horizon, 20-year, 30-year time horizon, and then actually go and grown this thing. We've got some capital behind us, but we didn't have to go. raise, you know, venture or, you know, private equity or anything like that. That's kind of, yeah, we don't have a ticking time. Basically, we don't have a ticking time while waiting for us to sell in seven or ten years that have a hundreders valuation.

Is that, you know, you talked about the Google Analytics. Is this actually a print business or is it, it's an online, you know, a media site, a blog that has print as like a vanity piece? Which one? What is the business actually? So, when we buy these, when we buy these, when we buy these. media assets. What we have to do is we go in,

and it really is a shift in mindset and a shift in product velocity at a lot of these companies. We tend to buy print magazines that happen to have a website where it's like, okay, we take our print content and then we post it online. And so, you know, when you go in and you require these, you kind of have to, you know, kind of level set with everybody and say, look, you know, digital is its own product.

and it's kind of, you know, we split out the P&Ls, right? So Digital has his own P&L and Print has its own P&L, and we make print a product as opposed to the core business, if that makes sense. Gotcha. So it's like, and the other thing, here's the thing,

and look, we came in, you know, Craig and I, day one, we're like, all right, we're killing print because, like, I don't know, Sean, Sam, I don't know if you guys have a lot of print magazines, but like, I didn't. I don't have a lot of print magazine subscription. It's just, you know, not, I'm 30 years old.

Like, I, you know, that's not how I consume media. And so, you know, we went in to shut down print, but there's something about being in print that Neil Vogel talks about this at Don Dash Meredith as well, that he's had a similar experience. So it's not, you know, this is not a unique perspective. Like, we're not the only ones that are thinking this. But there's something about having a long, a feeling of long,

longevity and a perception of longevity in having a print product, whether that's with advertisers or it's with audience or readers that you just don't get with a blog. You don't, it doesn't feel, and you know, you think about a brand like Dwell is a great example. Like they have a print magazine and it for some reason feels more legitimate than architectural blog XYZ.com, right? Because it has a magazine. So it's like we use it as kind of a staying power. but we also recognize the world's going to show. Yeah, you also mentioned you like, you leave the, you hustled your way to get the magazine in every like private chartered plane,

right, just to get the right rich people to be reading the thing because you like left it on the table in those planes. Is that right? Yeah, exactly. So we send them non-solicited to a lot of FBOs across the country. Some are solicit. You know, there's about 1,800 or so that are solicit. We've got an agreement with the distribution company.

But the other ones are not solicited. But they feel like we've created a product that has so much value that they feel as though it's something that they want to display on the tables. People go and pick them up. And I mean, we've had conversations with some pretty wild folks that were like, oh, yeah, I was in the FBO and I read your magazine and I want to collaborate on your real estate project. And so it's like, okay, like how do you quantify like an ROI on that? Like, you know, hard to like do your last touch attribution,

except for like, oh, yeah, you read about our project in our magazine that we put in the FBO. And now we have, you know, really cool partners, you know, on the real estate project. Gotcha. Well, Preston, you're the man. This is a crazy business. Thanks for the on the spot call in. Yeah, man. Long time listener, first time caller.

So first ever caller we've ever had. Yeah, first ever caller, actually. All right, man. Take care. I see you, man. that was awesome all right we changed the show

that was cool I like him all right well I mean we got our information that's awesome congratulations to Craig and Preston

I'm happy that he was transparent yeah really cool all right what else we got you got one you got one yeah let me do one

okay let's stick to the print let's stick to the print idea but take a different angle so the New York Times the New York Times when you think about it you think this prestigious newspaper, it's all about the news.

They want you to think it's all about the truth. That's their marketing. The New York Times has more in common with Zenga than it does the truth. New New York Times is a games company. And this is the numbers behind the New York Times and their gaming products is pretty amazing. So I don't know. Do you ever play their games?

I'm a paying subscriber to their games. Well, I know they have Wordle and I played that one. They bought Wordle. The guy had made like, the guy like, The guy like made Wordle for his girlfriend or something like that. Then it took off and then they ended up buying it. But like I have a 22 days, 22 day street going right now on the crossword puzzle,

on the mini crossword and word. How much you pay? I think it's like $6.99 a month or something like that. And what's the revenue on that? Take a guess. $100 million. A lot more than that. So the New York Times just in Q4,

their digital only subscribers was $289 million, which is almost all. their games. It's a little bit of their cooking product as well, but it's like mostly their games revenue. And so that's 300 million in the quarter. Their gaming basically has pushed their annual subscriptions over a billion dollars a year for the first time ever.

And they released this chart that was basically like the New York Times bundles. So you have the news. You have their cooking section, their cooking product. You have the athletic, which is their sports thing they bought. And then you have games. So take a look at that chart right there. You could see that games, you know, a few years ago, a few years ago, games was roughly 15% of time spent.

Now it's over 50% of the time spent in their bundle is on the games product, which is pretty wild. It's more time spent on games than on news. It has overtaken news. And so you have this thing that is just fascinating. It was like, you know, they used to, in the newspaper, have a little crossword section, a little Sudoku section. And what they did was as they,

transformed the product, they unbundled it. They made it a standalone thing. And what's cool about it is almost every game on my phone is just trying to like, it's like needy. How do I take all of your time and all of your money? And the New York Times thing is works way different. It's you have one a day. There's one mini crossword a day, one crossword a day and one, you know, one wordle a day. You do that every day? Every day. Me and my daughter do it together. We play wordled together and then I do the crossword on my own. The mini crossword literally takes under one minute. Like my average time is about like 57 seconds to finish this thing.

So it's a very short game. And so I'm able to like play a game and have that dopamine hit without it like taking away from my life by being like, oh, great. Now I'm having hours on this. Hey, baby. What's the, it starts with an E? What's the disease that brought down Chipotle in 2009? Oh, you're right. Ebola.

That's it. Yeah, well, she plays Rortle with me and she gets to type. and then I come up with the words. And so, you know, the games are really fun. It's a really well-done app. And it's shocking to me how successful this thing has been. And so I want to just read you a couple things. So it says basically a few years ago,

the time spun off cooking, crossword offerings to standalone products, meaning you could subscribe to either without being a New York Times new subscribers. Seemed like an odd choice because the internet already had millions of games and millions of free recipe apps. But what they did was they just digitized decades of old crossword puzzles and old cooking recipes that they already,

had. So it's this kind of remnant inventory that they weren't using. And they took that stranded asset and they turned it into like a viable asset, a live asset. And then they just like modernized this. They put it in an app. They made it work really well. And super simple app. And it basically

breathe new life into the company. The company has grown like crazy. So now there's like over one, now between crossword and cooking. Check this graph out. So we just start calling the New York Times a gaming company? Yeah, exactly. Yeah, you guys wrote those great games. And you got to like a sick blog that you talk about like the Trump trial. I love that too. Side hustle. Yeah.

I love that little blog you guys got going. They have over, and this was in 2020. So this is years ago. They had 1.3 million paying subscribers that paid on average, you know, $40 plus a year on the on the games and cooking product, which is mostly games. And they're not alone. So that, so that's the New York Times. Then I saw, you know, I opened up the YouTube app. Do you use the YouTube app? Because I opened it up and I saw something very new. I only use that. Yeah. did you see their new games product? YouTube. If I open up YouTube, these are games and it says play now

and you don't have to download anything, right? So it's like, I click play and now I'm just, I'm going to be in this game. And this is a popular mobile game. This thing called States. It's like a little like risk type of game.

And so they have like 20 of these games. It says instant games, no downloads. So YouTube's doing it now. And then LinkedIn the other day, announced LinkedIn games. I have three games on top of LinkedIn.

There's like a wordal variant. There's like a whatever. They took popular games. They just kind of made their remix of it. And if anybody needs engagement, like real engagement, it's LinkedIn. LinkedIn's got a billion users.

And, you know, but like there's not a lot of good content on LinkedIn to do. But this is cool because they basically made it where they have their Sudoku, they have their trivia, they have their word game. And basically you can see how other people in your company do.

So it's like, they already have the social graph of who's in your company and who are you connected to. So when you play the game, you can see how you compare to people you already know because they already have that social layer

built in of like, you know, kind of competing amongst your... Who do you think they stole this from? Because like, imagine, imagine like, the meeting where they're bringing this up. It's like,

hey, Sharon, you got any ideas? What if we call it LinkedIn influencers and we get famous people to post? Eh, been there, on that. And then this other person is like, hey, Charlie, what do you got? What if we just put like risk in the feed of LinkedIn? You know what I mean? Like, how would you justify doing that? So I don't know if they acquired a company that was doing this or if they or if there was just like, I imagine some product manager that looks like he just got back from NOM and he's like,

I had an idea and I got it through. I got the I got my manager to approve my manager's manager. It went all the way up to the product org and went through the committee. and it happened. They all said, yes, I get to launch this thing. And like in six months, it's going to die. But I actually think

this is actually a good startup opportunity. I think that if somebody built the third party LinkedIn games app, like I don't know fully, I haven't explored the LinkedIn API and like what's all possible. But if you can hook in and if you can build a game on top of LinkedIn,

that's just like a total greenfield opportunity. And LinkedIn will buy it if you do a good job. If you build the actual games product that's getting engagement there. And you don't have to invent, the games. Just steal the games. And you're basically saying proven game and new social graph.

And that's the whole business model here. That's pretty insane. I did not see that they were doing this. And that is actually quite smart. LinkedIn is the behemoth that somehow always works. And so it's quite wise that they're doing this. The one that I don't believe in is Netflix is doing games. I don't know

if you've ever seen like they have a games thing in like there's a trivia game you can play in Netflix. But also if you go to the app store and you search Netflix as the game producer, they have like 50 game titles. It's like pretty insane how many mobile games that they have. I don't understand this. I don't think it's going to work.

I don't understand the tie between this. But, you know, basically, secrets out. It's like, you know, games make a lot of money and people use it all the time. Maybe we too should be in the games market. And that's wild. That's what they're trying to do. That's awesome. Kudos to those guys.

I've not seen that. I will. Let me do a quick thrill of the show. I want to promote something. I'm going to try and it extra thrilling. Have you ever thought while you're building stuff? You think to yourself, am I doing this right? I remember being in San Francisco and I thought, well, you know, Sean's got a fancy office. Therefore, we have to have a fancy office. Or, you know, this particular CEO said, you have to focus on this one thing. So I have to focus on this one thing. So to grow Hampton, we came up with this podcast called Money Wise. And Money Wise is basically

like a personal finance podcast, but for high net worth people. And I've done eight or of the episodes as like the temporary host. And I want to tell you what my biggest takeaway, which is to get wealthy or even to spend the money once you're wealthy, there's no one way that people are doing it. There's a lot of different ways that people are doing it. And I've already recorded, I think, 12 or 15 of these,

and I had to do nine already for the first season. Dude, first of all, it's insane that people reveal all this information. So we basically, what we do is we have people come on and they reveal their income, their expenses, exactly what their portfolio looks like. And then, like, we'll dive deep on one topic, like parenting or whatever. Are they anonymous or they put their name on it? I haven't listened to it.

Half and half. So sometimes they're anonymous. And what we do is we change the name. And we actually change the voice. And so there's a bunch of people who you know of that have been on, but they changed the voice. But then sometimes, like, the guy from Simple Modern came on and he's completely open about it. And he'll say, here's exactly how much I have in my bank account. Here's what we have in my index or in my portfolio.

here's how much income I have. It's insane that people reveal this amount of information. It's almost scary. And so my big takeaway is one, there's no one way to do it. Two, I'm shocked that people reveal all this information. And number three, the more money you get, the more intentional you have to become. Because these people will make literally $100 million and they don't spend any of it. And they're like, I don't even know what to do with this money.

What's been a lesson learned either in probably in the, probably in the, the spending side. So how, what's something somebody said about how they spend that you were like, oh, that's a good idea. That's a cool, intentional way of going about this. We talked about giving money away last time. You can't use that one. Use a different one. So I firmly believe that owning more than one home is a massive pain in the ass. And that's a dream that people want to have. They want to have a second or third or sometimes fourth home that a lot of these people have have. I think that is a huge pain in the ass. I place the word home with problem. It's like, I have a second problem in Tahoe. I have a third problem in Florida that I go visit once a year. Nice problems.

Dude, it's such a pain in the ass is to have that. And unilaterally, people seem to regret having multiple homes. And so being intentional about spending money seems like a huge deal. One of the very few rich people things that I think is totally worth it. Flying private. I think that is the one thing where it actually might live up to the height when people, I think buying a plane, sorry, Preston. I don't know if that's worth it, but I think charging a jet as much as you can, absolutely worth it. And so we're doing this podcast, whatever. It's called MoneyWise. You guys should look it up. I'll tell you quick, quickly, I had this premise to make a hit podcast. I think you need one or more of the following. You either need great production. You need great delivery. You need a unique perspective. So,

unique perspective is like LeBron James talking. Great delivery is typically like comedians. And then great production is like cereal or whatever, like these like wondry things. my gap in the market that I wanted to exploit was the first one. I think you and I do number two and number three, and I wanted to do number one. And so so far, it appears to be working. So if you're a creator, those are the three ways I think to do a podcast.

And that's my little pitch on money-wise. Congrats. That was a good, good thrill of show and liked it. All right, let's do some other ones. Do you have another good one or can I do my AI camera one real quick? Do your AI camera one because I have something funny to tell you.

All right, AI cameras. So I play in this basketball league in San Francisco. Shout out to Ruben Torrenberg, who hosts this league. He's been hosting it for like 10 years. And it's basically it's called SF Tech Hoops, I think it's called. And basically it's like people from the tech industry that like to play basketball. And for a long time, Rubin basically, he runs the league with some real heart. And I really appreciate that.

Meaning he makes the teams, he has the league. There's the table stakes, what you expect. Teams, jerseys, referee, scoreboard. great. But then what he does is every week he writes an email recap with gifts and whatever. And he basically like team one took on team three. They were led by Sam Parr. He scored 13 points. And he had a great buzzer beater, blah, blah, blah. But then in the second half, this is what happened. So he writes these great updates from the commission. So he writes his own like internal newsletter for the thing. The second thing he does is he films it. He used to film it basically put two tripods with the iPhone on each side.

And he would try to afterwards go through and cut a highlight. And highlight is a really generous term because you're talking about. out of shape tech dudes. Like, I made a game winning shot last week. And in my head, and if you asked anybody that I talked to afterwards, this was fucking Jordan against the calves in 89 or whatever. I was flying through the air, you know, hit the shot at the buzzer. It was amazing. It was like just.

And then I watched the clip and I was like, like, you could literally, you couldn't fit a book under my feet where I jumped. I was like, this is ridiculous. This looks slow. This looks terrible. This is like a game loser, not a game winner. So highlight is a little bit generous, but either way, he puts the, you know,

the TLC into running this league. So he just bought this new thing that is a game changer. And he bought this AI-based camera call, I think it's called VEO. There's a bunch of these. There's like four companies doing this. But VEO, check this out. Basically, it's one camera that you, it's like a smart camera that you post on a tripod,

and it does a couple of very basic things. things that sound trivial but make a huge difference. So he used to have two iPhones because you needed to record both sides of the court. And basically for one iPhone, half the time when everybody runs to the other side of the court, it's just empty. And so then he could never have like a full video of the game because he couldn't get the camera to follow it. He'd have to hire somebody to manually like swivel their head and do this. But now with AI, basically it's one camera that just tracks the ball at all times.

So this works in soccer. It works in basketball, works in football. It just tracks the ball and the players. It just keeps everything in the center of the frame without having to have a human doing it. The second thing it does is it uploads it all to the cloud. The third thing it does is it does is it live streams at all, which is cool because now people can watch your games, which is like friends and family can watch games. The fourth thing it does is it can try to cut highlights. So it can basically try to identify a cool moment and then cut the highlights or keep track of stats.

It's just getting better and better. These are all software updates from here. The hardware is just camera with enough enough of a chip inside that can connect it to the internet, connected to the AI software. And so these companies are crushing it. They raised over $100 million in funding. And it's like some European company. There's four or five competitors. All of them have raised a bunch of money.

And I think they're all doing really well. So I noticed this at our game. And then my brother-in-law, who's got a kid that plays like competitive soccer, she's like, you know, seven years old. And I was like, dude, have you seen this thing? He's like, bro, it's on every field. Like this is like, you can't go to youth soccer now and not like every single field has one of these.

And so I think the same way. that Steve Jobs had like the vision, I think it was Jobs, or maybe it was Bill Gates, but it was like a computer on every desk. I think it was Gates. A computer on every desk was the goal, a personal computer.

And I think now it's going to be basically a camera on every field. Right. It's like every single high school, every single middle school, every AU game, every, you know, travel team,

they're going to use these things because why not? Well, somebody's going to make the investment one time. They're really, it's not one time. So, all right. So for the most,

popular version, it's $1,000 one-time expense, and then it's $130 per month. Yeah, the most expensive one. I think there's like cheaper ones than that. I don't think you have to get the crazy one. But yeah, like that price is going to go down. Like the $1,000 hardware is going to go down, but the, you know, 100 bucks a month is going to stay there. But if you're like a team or really, you don't even have to buy it per team, it's like the league needs to have it. So it's like the venue needs to have it. And I just predict that every venue is going to have these. Like they will get, whoever, wins is going to get these into every single field, every single court. And it'll just be that way.

Tennis, wrestling, like every fringe sport. There's people who want to watch. It's the family, the friends, the athletes themselves and their coaches. And there's enough motivation to do this. Their website is so good that it makes me want to play soccer. It's sort of like, it's sort of like GoPro where I like, the footage is awesome that like, I got to get into snowboarding right now, just so I can go and like live a life. it's recording. Dude, that's how I thought when you were talking about the magazine stuff, I was like, yeah, the wind blowing through my hair, my hair as I'm on this boat.

Yeah, maybe I do want that lifestyle. Yeah. Do I want to be a boater? That's how I feel when I go to their website. This is a, A, this is awesome. B, I'm shocked at how large this is. I guess it's not a surprise, but it sort of is a surprise that there's multiple companies that have raised nine figures to build this.

I think these are doing, you know, 50 million plus a year in revenue minimum, you know, the leaders of this space. I don't know the exact numbers, but like ballparking, I would, I would be surprised if it was under that. This is absolutely insane. I never in a million years would have thought that this would become a thing. I have the opposite opinion, which is, this is an obvious idea. It's obvious that it's working, but it's not obvious that like, I don't know. I think this was obvious before, dude, when, like, why didn't you start it?

Well, because the idea, this idea has been around for a long time. So, for example, in NBA stadiums, they, there's like an enterprise version of this called Second Spectrum. And there's a company called Synergy Sports. There's like cameras that they install in the, in the eBay venue that tracks all the players and all the motion. And it keeps track of certain specific advanced stats for the teams. And so this idea of like, oh, wow, couldn't you either install cameras or use computer vision to track stats?

That's interesting. Then there was flow sports, which is basically live streaming niche sports, like, you know, jihitsu competitions, wrestling competitions. And they were doing tens of millions of years. in revenue. Yeah, their offices here is in Austin, and I've been to it, and it's sick. It's really cool. It's a big company. And for those, those are for more official competitions, like, you know, the Texas state, you know, karate championships or whatever, not like, you know, little Susie's soccer game, which like, you know, Susie's parents and grandma and whatever

want to be able to watch. Like back in college, I remember my roommate Trevor, he would always watch his little sister's basketball games, and he'd be on his computer and he's watching this greeny footage. And I'm like, Who the hell is streaming this ninth grade girl's Wyoming basketball regular season game? And he's like, he's like, I pay for this thing because like we pay and then this guy films it. And then he's, you know, he uploads it later. It's not live stream, but he uploads it later. And I watch the shitty footage, but like, I really want to see my sister's play.

Like that matters to me. I'm willing to pay like my price sensitivity. It's like, I'll pay the equivalent of a Netflix monthly subscription. But instead of giving me like all the world's best content, I get my. my niece is games. And it's like, there's an emotional reason to do that. So this idea was around for a long time. I've noticed this, but it needed a technology inflection.

And it needed the AI camera where you don't have to hire somebody. The quality is now good enough where it's actually fun to watch. You can live stream it, record it, cut highlights, all that shit. And so now I feel like the idea, it's an idea whose time has come. And we were, I was talking to my buddy Luke about the AI, like the AI wave. He's in my like AI tutoring group where we, we like learn about AI together. every week, once a week. And he's like, you know, whenever there's a new technology shift, he goes, I always think back

of what, he goes, I asked the question, what is the restaurants on the, uh, menus on the internet of this wave? Like menus on the internet, what do you mean? He goes, well, when the internet first came out, the very first obvious startup idea was like, well, let's just take like restaurant menus and put them on the internet. He's like, before we could do DoorDash and online ordering, like all the next gen shit. The first thing you do is you just put the menus on the internet, just a picture of the menu. And he's like, for every tech wave, there's always like,

the very obvious. It's kind of not where the thing is going to go, but it's like immediate value add, no-brainer, like wave one of what people do on these apps. It's like for the iPhone, remember it was like the beer app, the flashlight app, the calculator app.

Like that was the menus on the internet. And now with AI, there's some things like this that are like the menus on the internet version of what you can do with AI. So you're AI tutoring person. It's now warped into a studying group. Oh yeah, bro.

It's growing. What is it? I don't want to tell you. It's like Fight Club. It's like Fight Club with no fighting, just screen sharing on Zoom. But is it like a group of you who meet and you just come with the homework and questions? It's three of us who people I think are awesome that I wanted an excuse to hang out with.

So it's me. It's Matt Mazio and it's my buddy Luke. And I'm like, I wanted to hang out with these people more anyways. They're also in AI. They're investing. They may be, you know, start companies in the space,

whatever. And it was like, hey, let's just do this together. That way, it's a little study group where you see something and then one person says something. And then the other person pushes back. He's like, well, I don't know. What about this?

And everybody gets a little smarter for doing it. What are your biggest takeaways now with AI then? Because I don't know much about it. So Sam Altman recently said something. He goes, there's two types of companies in AI. There's the companies that can't wait for us to release a new model. And there's companies that can't sleep at night knowing we're going to release. a new model.

He's like, we're going to crush you. They're not saying this, but the way they've architected their business is, if we make GPT5 better than GPD 4 and we improve a bunch of capabilities,

the model gets smarter, it gets better at doing all the things he's doing, which he's like, by the way, that's exactly what's going to happen. Duh. Like, insane to bet against that.

He's like, they risk being like, you know, blown up. Like, you know, they become obsolete when that happens. I'm pretty sure he goes, we're going to steamroll with them. Yeah,

he goes, those companies will get steamrolled. Yeah. Which is not a good thing. That is amazing. So then the other companies, he's like, the other companies are begging us, can't wait for the next model to come out

because it's just going to make their product better. So then the group, we were talking through like, okay, what does that really mean? Who are the companies that fall into group A and fall into group B? There's an interesting discussion around that, but I'll just give you like a simple example.

Let's say you're some company that you do transcription, translation and whatever for companies that are... But not rev.com. So rev.com says, pay us. Rev.com is a good example

of the steamroll type of company. So it's basically it's like, pay us, we do transcription really good. We have human transcribers. They're great. It's like, well, guess what? It's going to be better than the human transcribers.

GPD5. It's going to be awesome and it's going to be way cheaper than rev.com. It's going to drive your price to zero and be better. So that's like, Rev.com is in trouble. Then you have a company that's like, cool, we do

transcription translation in the context of this certain healthcare thing, this workflow where doctors need to transcribe their notes on the go and it needs to be really high fidelity. And today that transcription is done by a human, but like whatever. It's like they have a full like enterprise workflow. And if the transcription capabilities get better, they're like, awesome. A product got better. But the product was like, open AI is never going to build the thing that integrates in with the the doctors, you know, like whatever, you know, healthcare record system that they use.

they embed themselves in a workflow, and that's like 90% of the product, and the 10% improvements to the AI, the transcription, the translation, but whatever it is, if those get better, great. Our product got more effective,

but it didn't make our product obsolete because we have this 90% that we've built around it that is really specific to a certain use case, certain workflow, and so we can't wait for the next model to come out, versus maybe other companies like rev.com or companies that are like, We're like Open AI, but we're better at, like, you know,

here's an example of a company I think is at risk. You know, these companies that do voice, text of voice. So like, you know, 11 labs is one, play H.T is another. It's like, basically they're like, we're better than like we can do AI. You type in a thing and we can create a human sounding AI. And we're going to fine tune our model to do that. But then Open AI releases like every, every month, they just release a new thing. It's like, yeah, we have text to voice now.

Check it out. Here's the demo. And the demo's awesome. It's like, it's only going to get better. And then it's just going to become a standard API for anybody to use to use text to voice. It's like, I think those companies that are trying to be like, we have our own proprietary model, our own fine-tuned use case, they're going to really struggle

because they can't compete with the behemoth. How are you taking advantage of this then from a business point of view or are you? I would say on the investing side, I'm much more measured twice, cut once right now, meaning I'm not spraying and preying a bunch of checks into a bunch of random AI companies. I think it's really hard to figure out right now which companies actually have legs. Also, they're all really overpriced. So I have this combination of really high price, really low traction. Product is really good in a demo but not really good in production.

And I don't know if they're going to become obsolete due to open AI. So there's a bunch of problems there. It's like actually a better bet was just like in the stock market, just buy companies that have like a massive advantage when it comes to AI. It's like go buy Nvidia, buy Facebook, buy a bunch of stocks that are. going to benefit from AI, whether they're not just like a one random startup that I'm hoping is the one out of a thousand startup that becomes enormous. Well, that's what Morgan Stanley put out this report. And they said, they go, AI is going to be a big deal.

Unfortunately, we, well, not unfortunately, but we think that it's going to impact big companies who are already established. It's just going to make them significant. There's going to be more value in making those companies better than there is starting new companies. Exactly. And they actually said marketing. and the reason I thought it was cool

is because I own stock in a marketing technology and they're like, we think that marketing technology and that type of stuff, Salesforce, HubSpot, whatever, that's going to be the biggest sector that's going to use this shit to grow.

Well, I think it's a safer bet and it's a more obvious bet. I don't think that investing in startups right now is a bad idea. I just meant it's really hard right now and it's unclear to me and I haven't put in the time to get a lot of clarity on which,

I don't have a bunch of startups. I'm like, these are going to be winners in this space. I just haven't been able to get that level of clarity yet. So it's like measure twice cut once, meaning first I'm like,

let me just learn this in more depth. Let me use all these tools, which is what we do. So like in these sessions, we will just be like, cool, here's a tool that can do X. And then I, he's like,

you drive and I go and I start trying to build a thing that's going to be useful in one of my businesses. Are you paying this person? Yeah. Still? Dude, this is so smart. Because we did it as a group,

like the sessions are more fun. And it's like a pretty valuable, network of people to be really tight with, which is ultimately what you want. You want the thing to be so mutually beneficial that the financial outcomes of the thing are so secondary. The primary should be the session is fun

and these people are awesome and I get to hang with these people. These people, I get to basically, iron sharpens iron with these people right now. That's like what I wanted this to get to. And so I feel really good about that. Dude, that's so smart.

More people should do this. I mean, I used to do this with book clubs, but if I had a very specific interest like you have right now, even if it's just a temporary thing that lasts six or 12 months, that's the way to go. It's so smart.

That's such a smart thing for you to do. Well, the smartest people I think always did the second crypto. I know people were doing this early on. I remember hearing these like sessions about South by Southwest where I forgot whose room it was, but it was like everybody used to go up to Garrett Camp's room. And at South by Southwest,

there's like 15 people that were all kind of like loose friends like this, but like a lot of mutual respect. And it wasn't like a paid party or some like event with sponsors. It was like, no, dude, like, we're here to basically talk about everybody should have opinions on where they think the puck is going. And then they would debate. And that's how Matt Mazzeo actually got in with Chris Saka. Saka was like, who's this motherfucker that has like really interesting things to say? It's like, he's an agent at CAA in Hollywood. Like, this guy should be in the tech world and he recruited him from there. And this is where like, you know, there's a lot of the

guys who invested in Uber early on, like Garrett and Travis were in the room. And they were, you know, talking about Uber at the time. And Gary Vee was in the room. There's this legendary story. I have no idea what it actually happened. But I remember hearing these stories and being like, I need to get into rooms like that. What is a room like that? How do I make a room like that?

If I either need to get in or I need to make a room like that. What was the story of the room? Well, I just told you. Yeah. Ari, was that the second time this episode, Sean Copped an attitude with me? Well, yeah, I'm like, I told you the story. You're like, well, so what happened?

I'm like, well, that's the side. I told you everything I know, bro. I don't know anything else. Does Zoom have like a bitch slap animation that I can use? I know they got a thumbs up. You know when you do the thumbs up and it like starts bubbling hearts behind you? Do they got a middle finger? Let's see what happens.

Does that work? That's the second time. I apologize. I'm a little sassy today. I could be caddy on Wednesdays. I know. I'm my bad. Is that the pod?

Do we wrap up there? I guess so. I think I need to go work on myself. I think of meditate. Chill out. All right. That's the pod. I can rule the world.

I know I could be what I want to. I put my all in it like no days off. On the road, let's travel, never looking back.