My First Million - We found an app that lets you buy anything for $0

Episode Date: June 24, 2026

*20+ hours of investing wisdom:* https://clickhubspot.com/cbah Episode 836: Sam Parr ( https://x.com/theSamParr ) and Shaan Puri ( https://x.com/ShaanVP ) talk about people who have turned their lifestyles into millions, plus Nick Sleep’s investing genius.  — Show Notes: (0:00) fringe creators (13:14) Nick Sleep's shared economies of scale (24:41) lloyd blanfein's personal finances (31:14) David Rubenstein, the man (39:09) Nat Turner's crazy new business (50:13) a brief masterclass in valuing denim — Check Out Sam's Stuff: • Hampton (joinhampton.com): My community for founders. Average member does $25m/year. Many of the guests are members. Get after it...apply: http://joinhampton.com/mfm — Check Out Shaan's Stuff: • Shaan's weekly email - https://www.shaanpuri.com  • Visit https://www.somewhere.com/mfm to hire worldwide talent like Shaan and get $500 off for being an MFM listener. Hire developers, assistants, marketing pros, sales teams and more for 80% less than US equivalents. • Mercury - Shaan uses Mercury for banking across all of his companies. you can too: http://mercury.com/  Mercury is a fintech company, not an FDIC-insured bank. Banking services provided by Choice Financial Group, Column, N.A., and Evolve Bank & Trust, Members FDIC • I run all my newsletters on Beehiiv and you should too + we're giving away $10k to our favorite newsletter, check it out: beehiiv.com/mfm-challenge My First Million is a HubSpot Original Podcast // Brought to you by HubSpot Media // Production by Arie Desormeaux // Editing by Ezra Bakker Trupiano /

Sam, we've been doing it all wrong. This whole business thing, this building thing, we've been doing it all wrong. I feel like I can rule the world. I know I could be what I want to. Days off. On a road, let's travel, never looking back. See, we thought you have to build a product. That product has to do something, has to add value, solve a problem.

And here, I will read you this tweet. This is from Next to TV. They say dopamine websites are the new trend in South Korea. These services let users end. endlessly browse food delivery menus, read reviews, filled their shopping carts, and even track their shipment. But the only catch, none of it's real. You're not really placing an order for anything. There are also virtual smoke breaks where you can join anonymous people in chat rooms to recreate the feeling of taking a smoke break without having to smoke a smoke a familiar dopamine hit without them having to actually spend any money, leave the house, smoke or do anything else along those habits.

And these are becoming incredibly popular in South Korea, apparently. Is this the same country that's having a massive birth rate issue? It checks out if they're going to create virtual smoke groups and fake buy stuff. What the heck, guys? So the trend started this year, and it's basically Korean Gen Z. They sort of realized that a lot of the fun in online shopping is just browsing. It's just putting things in the cart, it's hit and checkout. You know, getting the actual product is, you know, sure, maybe that adds some value.

but there's a lot of fun in just the other side of it. And so you can see, here, I can pull one of them up. Let me open. And so this is a app called Food Never Comes. And, all right, so check this out. So you open up the app and you can select rabbit or turtle delivery, so fast or slow. Do you want to, should we pay for fast or slow? I guess we should pay for fast.

I want to get my fix so quickly. Let's treat ourselves. Okay. So now there's a fried chicken. restaurant so we can have the half and half crispy chicken, the cheese balls, got to go with the cheese balls, maybe the soy glazed chicken, we'll go spicy, we'll add a cola, add to cart, and then we can go ahead, we could check out, we put in our info here, and then we could watch this delivery, make its way to our house, never actually come, and that's it. It's the blue balls

of entrepreneurship, Sam, are you in or are you out? Dude, how can this group of people who have brought us such amazing things like the Kia tele ride or Samsung. We pop demon hunters. Yeah, like go and do something so stupid. The Koreans, you guys really are like the barbell strategy of life. They're bringing us such amazing, wonderful goodness

and such silliness. I guess I don't get this. Why are people doing this? On behalf of our huge, I'm sure, South Korean followership, I will defend this by posting a picture of the White House this weekend where there was a giant motorcycle

a motorcycle doing a backflip in front of the White House in preparation for UFC 250 to celebrate the birth of America two dudes in their underwear beating each other up in the White House lawn. Yeah, you don't think that a fistfight on the White House lawn is appropriate, an organized fist fight? Where a Frenchman beats up a Brazilian?

Yeah. America. Yeah, dude. Look, I didn't say that we both can't be stupid. I'm just saying that this is wild. Are these things actually popular? Now, I can't tell. So obviously this makes for an amazing headline. There's also a reason that I open up the show with it

because it's just funny to talk about and make fun of. But there's not a lot of Korean people on Twitter, so they can't exactly, we can't exactly refute this. It feels like, like, Japan. It feels like Japan and America have, like, separate internets. Like, have you gone into, like, a Japanese website? Like, like, when I, it's kind of challenging to use, obviously, just, even if it's just translated, it's still, like, totally separate,

and it's quite hard. And so, like, are there needing, like, proper career? people on Twitter to refute this story? Or can we just make up falsehoods about like... I think we just make it up. It's like the good version of like the Hunter Biden laptop story is the South Korean fake Dordash story. Have you ever studied like Eastern Internet?

You know people study like Eastern philosophy? Have you ever started Eastern Internet? Yeah. Like Masa Sun from SoftBank. I believe he's a Korean guy who lives in Japan or is he Japanese who lives in Korea. Anyway, yeah, I've studied him and then I've studied him. and then I've studied some of the Chinese websites or the super apps.

They're so like mega that it's quite hard to understand what they're about. Yeah, there's so many crazy apps and sites. So just for example, I remember when we were looking into live streaming. So my first company that sold Bebo, it was in the live streaming space.

We sold Twitch, which is the big American player, but live streaming is far more advanced in Asia than it is in the West. And if you go look at like, I forgot which ones it was, Y.Y.com or whatever. There was a whole bunch of these where you would see somebody on video and then horizontally from right to left streaming across the screen would just be the entire chat. And it was the most bizarre experience ever because you would see that 7,000 people are watching

this girl eat noodles while text flies across the screen and people are spending thousands of dollars sending her virtual roses. And we were looking at this studying it like, you know, it's like, you know, when you study like a tribe and you're like, so they just eat it? And you're just like, yeah, this is exactly what they do. And then we try to recreate as many of those variables as we could because these sites were incredibly

popular. Is it there one where it's like fat people eating? It's like bang bang? Isn't this like a... They don't need to be fat. Oh, I thought there was one guy like named Nico avocado or something like that. He got

really fat doing it. And then he lost a lot of wait and came back. He's kind of a weird guy. But yeah, Muckbang is basically watching other people eat. Just like you watch other people play video games. You watch other people play basketball. Turns out people want to watch other people eat. And they like having that high definition sound, watching them slurp and chomp on their food. I get joy from that, by the way. I always, I buy candy and sweets that I want to eat for other people. And I'm just like, I'll hand it to them. Yeah, I'll hand it to them. I'm like, eat it. Tell me how it feels.

Like, I definitely can get like secondhand. and like sugar highs from other people. Okay, so you're in. So we started it out, and now you're in. Dude, there's this whole genre of Indian barbers who shave people's heads who have dandruff, and you could like, it's like the oddly satisfying of like, oh, we found it. Let's wipe it off the head. Yeah, the oddly satisfying stuff is crazy.

There's other sites that I think are like the kind of the current trend of like what's big in the east. That's not yet big in the West. So before there was live streaming. That was obviously a huge one. Mobile gaming, so internationally, the biggest, the most popular games were all on your phone. There weren't Xbox, PlayStation, they really didn't have like big console or PC culture. And so games like Free Fire or PubG Mobile were huge. And then Fortnite became the version of that in the U.S. soon after.

And so you could sort of see these trends moving over. Live shopping has been huge in Asia for a long time. Now, whatnot is the U.S. equivalent of live shopping worth 10. billion dollars. And so you can kind of look for these products that are over there and try to say when and how will they translate. So right now the big one is we've talked about this before, but the short drama. So serial drama. So basically it's Netflix, but you watch on your phone vertically. Each episode is like 30 to 60 seconds. And it's basically soap operas of all different types of genres that people get incredibly addicted to. Huge in Asia. So Hugh is kind of like the China, Japan,

Korea area, now getting big in India, only a matter of time until it's also just as big in the U.S. is my guess. I just pulled up these notes that I have from, I think, 2016. So there's this guy named Kevin Ryan, he's been on the podcast, front of the pod. And he founded a bunch of companies, the biggest one being MongoDB, multi tens of billions of dollars company. But he also famously was the co-founder of Business Insider. And so I called him one time and he like gave me some tips on like how to start a media company because I like didn't know anything and I emailed them so many times that he relented. And I have these notes. And I, I, something always stuck with me on this framework. So he said on this show, we have spent hours talking to some of the best investors alive. Well, lucky for you, the team at HubSpot, they have pulled out the principles that matter most and turned it into a very simple, easy to read, wealth guide. It's 35 principles.

from the top investors. We're talking guys who have been on the pod like Howard Marks, Monich Pabry, Morgan Housel, Kathy Wood, and a ton of others. So these are all their frameworks, their mental models,

their rules, basically how to play the long game and how to avoid ruin. You can get it in the link below. He didn't use all these exact words. This is me like typing. This is before Grinola existed. So he goes,

he's like, the business insider strategy is sort of what Honda did in 1985 versus General Motors. He was like, he didn't say this but this is my notes start with shitty quality and get traffic to our website and improve shit quality but we'll improve like how he said in his all hands inspiring his all of his employees he didn't say that way but he was like we're he said um like Honda in

1985 versus GM Honda was considered sort of a joke GM cars were these like big like heavy duty vehicles that made a big thunk when you like shut the door and hondas were like rinky dink but the difference is is that uh with honda as well as with business insider the quality uh of car that they were making increased but their cost they stayed the same which is why honda eventually won and business insider we make content a lot cheaper than wall street journal but we think that our quality is just going to continue to rise and that was like his whole strategy and i always thought that was really interesting I thought that was a really cool analogy, which is you could start, like,

kind of like so-so and just slowly get better while keeping your costs the same. And he always referenced in our call, he was like, Honda did this, Toyota did this. And I started thinking about this. And I've always thought about this, like, strategy that a lot of Asian companies did.

Do you know TCL TVs? I've never even heard of that, no. So TCL, if you were to go to Amazon six years ago and buy a TCL TV, they were the worst. they were like pretty maybe 10 years ago they were junky TVs but you get a 65 inch flat screen TV for like literally $200 and over it I'm like a gadget nerd and so over time TCL is now a baller TV company and you can still get a 65 inch highest deaf fanciest TV for $200.

It's actually I don't even know how this is possible and I've always thought about this strategy of like Asian businesses and I've noticed I don't know if it's particularly an Asian thing or because he referred to Asian car companies now I always think of it that. that way. They'll offer something where like the quality is so-so, but just good enough, but over time, like, it's sort of like Hyundai or Kia or Genesis, like, particularly, you know, Asian car companies. That's how I think of them is they're kind of like crappy at first, but they just get so much better. And the prices stay the same. What I like about this is it's the opposite of the normal white guy referencing Asian culture thing, or normally we take these like amazing Zen practices. We're like, the Japanese use the word kaizen for the continuous pursuit of professional. And that's what we do here at our company. Or it's like wabi sabi, the beauty in imperfection. It's like always like these high and mighty things that like we're borrowing.

And he's like, we use the term pontification where you start with shit. And it stays shit for quite a while. But eventually the shit becomes a little less shitty. And that's what we do. It's like the first honest white guy. Like we give him a award for like he's doing all of the like the tone and the hands. gestures, but he's just saying the truth. And we didn't stop there.

We took the shit that we had and the year after, just a little bit less shitty. Because they don't know the difference. And we told us to consider the market. Yes. There should just be like a whole service for just like honest business translation. You know like Google Translate, but just like corporate translation. It's like take any company put their mission. values and earnings calls into this generator.

And it just tells you the truth. That's so funny. One of the grades, Kevin Ryan, probably no longer a fate of the pod. No longer friend of the pod. Former friend of the pod, Kevin Ryan. I told you that in confidence, Sam. There was a statue of limitations on notes, by the way.

Once it's been 10 years, I can talk about it. So, like, anything that happened, you know, from pre-20s. 2016, I'm allowed to bring it up. All right. So I was nerding out on something kind of related. So I'll segue to that. So you were talking about how for the TVs thing, they're like, they charge $200. And at first, it's kind of a shady TV.

But eventually it's kind of a great TV, but still for $200. Which is different than, I would say, most companies, which assume, you know, over time, the goal is to raise our prices, increase our margins, increase our profits. So I was studying an investor called Nick Sleep. Oh, man, dude. For those who weren't there. Ever since you brought them up. I've been on them. Yeah.

So, you know, his story in short is he was an investor, basically raised money, was an investor about 15 years, average more than 20% compounding, billions of dollars. He won the game, shut down the fund and moved on. And most of the fund was concentrated in three positions,

Costco, Amazon, and Bersher Hathaway. For the longest period of time, he was just holding those. And so the interesting part isn't, oh, wow, here's a guy who picked right. You know, it's kind of like, oh, I'm a lot, I'm interviewing a lot, lottery winner to ask how they how they guess the numbers. Like this is this daughter's birthday.

It's not really that. It's if you ask, what is Nick's Leap's philosophy, his core investing strategy? He had this idea of consumer surplus. So his main realization was, look, there's many ways to invest. You could do what Buffett and Ben Graham are trying to do, which is buy a company that's trading for less than it's worth. Or you could look at some of these companies that today look overvalued, like Amazon at that time. And, you know, the 2000s is like, wow, this thing's get a crazy price-to-earnings ratio. And he realized that the best predictor of long-term value for him was something that he called shared scale economies.

All right, so what do those mean? So scale economies is usually when, let's say you're Amazon, you have a large customer base, you're able to open warehouses in a bunch of different places, and you get what's called economies of scale, which is that over time your cost to serve each additional customer go down because you're serving so many customers, you're able to almost like amortize the investment costs

across a large customer base. Now, what Nick Sleep identified was called Shared Economy Sales. Was that a word that he, did he make this up? Yeah. So I don't know if he made it, if he invented it, but he was the one who really, yeah, he really bet on it. And he really, like, made it the foundation of his investing strategy. So he realized, like, let's take Costco. So Costco's goal is to basically get economies of scale, meaning they buy in bulk.

They have tons of locations. So they have a lot of pricing power. They're able to buy things in bulk at cheap prices. And instead of what most retailers do, which is they buy wholesale, sell retail, right? They buy cheap and they sell it out of markup. Costco's goal was to make the markup as small as it could and pass all of the savings of buying in bulk to the customer. So he did the math, and he realized like, okay, let's say that a Costco membership costs $100, let's just use around numbers, right?

And he realized that if for the average person who shops groceries at Costco, they're going to save on their grocery bill, let's call it $1,000 a year just by buying Costco, because Costco is passing on all those savings of buying in bulk to the customer. So the customer saves $1,000, they spend $100. And so the surplus that they've generated this $1,000 surplus, and then they're only charging $100 for it. It's a no-brainer proposition. And they basically take the, so what happens is instead of increasing their prices

and increasing their profits and increasing the money to the shareholders, they pass the profits to the customer, which makes a juicier value proposition, which attracts more customers, which gives them more scale, which allows them to create even more surplus. And so what he realized was that the companies that would do this, that would start early on and pass on the savings to the customer,

they would run away from the competition because they would have such a juicy value proposition. They would build so much trust with customers and have such an incredible offer to the customers that they would pick up all the customers. And so Costco, for example, They make no money essentially on any of the food that they sell. They make all their money on the membership, which is like pure profit is the membership.

How much? I'm just looking this up. I knew that it was a baller stock. It does $300 billion a year in sales. How much in the membership sales, do you know? $5 billion. $5 billion, yeah. So what he realized at that time was he said, wow, everybody just looks at, let's just say it was a billion dollars at that time.

It's like when a traditional analyst will look at this company, they'll just see, a billion dollars a profit. But what I see is 5 billion of surplus that they're passing on. And they passed on $4 billion last year, $5 billion this year, it'll be $7 billion next year, $10 billion the next year, and they're just going to keep passing on

so much surplus that it's going to run away from the competition. And it'll create so much trust and so much loyalty that they'll never have any problems attracting customers. And so he's like, that's an invisible metric that doesn't show up on the balance sheet. It doesn't show up on the PNL. You have to sort of manually calculate

the shared economies of scale, how much of the surplus they're giving to the customers. And if you track the growth rate of that, what you want is companies where that growth rate is increasing. He said Amazon was the same way. For 20 years, Bezos basically did not try to extract profits. He just reinvested all the capital to give people wider selection, faster shipping, and lower prices.

And he realized that every year, they're investing more money in giving people wider selection, faster shipping, and lower prices. The three things that consumers care about the most. And they have the prime members. just like the Costco membership. And so he invested heavily in that. And I just thought, oh, wow, this is a pretty brilliant insight,

a way of looking at businesses that I've never thought about. Yeah, that's actually, it sounds stupid, but that's sort of like a, I don't know, I need a lesser word, but a groundbreaking, like, stat. You know, that's actually very interesting. I've never, ever have heard of a company that measures that, like just how much savings we are passing onto. That's pretty interesting. Hey, let's take a quick break.

You know that feeling when strategy is done, the brief is written, everyone's aligned and you realize someone still has to sit down and actually create all the content, that someone is usually you and it's due tomorrow. Well, the Breeze assistant from HubSpot can help. It works right inside HubSpot. You can draft campaign copy, blog posts, emails, all in your brand voice, all using your actual customer data. So you don't create just content. You create content that converts. Check out HubSpot.com, the agenic customer platform for growing businesses. But who else does that? You have to do it with the company that's huge and where mass appeal or mass. need like a membership, right? Like a prime thing? Well, it doesn't have to necessarily be a membership.

There's other ways to do it. But, you know, the two biggest examples he did was the membership because it's the beautiful way to monetize, right? It's like, I'm going to give you so much value in the thing you're buying that giving me a annual recurring revenue membership is a no-brainer for you. And that's what prime is. That's what the Costco membership is. And so it worked out beautifully for those two cases. But it's not, it doesn't have to be that it's just that. So for example, But I was talking to AI today, and I was trying to say, like, well, what other, study other companies, if there's these thousand companies, which other companies would Nick's Leap see as having a high surplus and how would he look at it? Right? And so it's a, AI is not great at doing analysis like this.

But one of the examples it brought up was, was SpaceX. And basically is like, look, SpaceX is going to lower, it has already lowered the cost to orbit by 100x. So it's, it's reduced its cost by 100x. but it didn't keep the same prices to the government or anybody else. It also lowered the – it passed on the savings to the government, which is why it now takes, like, 80% of all payloads. It took all of the business. It took all the market share by doing that.

And they're trying to reduce another 100X, and they're putting up all these satellites, and they're trying to, again, pass the savings on to the subscribers for Starlink Internet. And so here you're going to have, again, recurring annual membership, a no-brainer value proposition to a member. to a mass market of people, everybody on Earth wants the Internet,

and they're getting economies of scale because as they improve their launch costs and their launch rates, they're not going to raise prices. They're going to pass it on and they're going to create a membership. So it's like SpaceX would be in a weird way, like, again, same thing as Amazon,

today looked at it as highly overvalued, but potentially undervalued if you could figure out how to measure the surplus and see that the rate of the surplus was growing every year, it might look like one of the, of those businesses. Now, I'm not, again, I'm a new with this stuff. So, like, I'm just sharing kind of like my beginner, my learnings with this just with you. I'm not saying that this is

or is not the case, not financial advice or anything like that. But I do find this idea to be pretty interesting. I hadn't really heard popularized before. This guy is so interesting to me. He's got everything that I want. And, uh, because he have like long hair, nice cab. Yeah, like he, you Google his name. Is he a lot? He's got a beautiful set of hair and only one photo. If you Google him, it's the same headshot used for everything. Nick Sleep, come on the podcast. I mean, how many times are you going to let me podcast make out with you before you just finally get on here? Yeah, do you want to break decades of being anonymous? It's come on the pod. There's literally only one photo of them. I'm real. It's like I got to this hotel and I paid

like disgusting about a buddy, but they had free snacks when I walked in and I was like, Honestly, love this place. Great value. They gave me this. They gave me like, you know, cake pops for free when we walked in. This is incredible. My kids are just so happy. And I feel like that's our pitch to Nick's leap.

It's like, yes, you've been anonymous for 20 years and you value your privacy. And you've turned down, you know, every opportunity under the sun. But we got peanuts and snacks. If you want to come on our pod, it'll be great. He's 58 years old. He's not old. This guy's cool. There's an article called How to Retire at 45, and it's about him.

So I guess he's taking it easy, but I would love to have this guy on. That would be so fascinating. Him and Paul Graham, there's something so mysterious about people who claim, I've had enough, and they, like, opt out. I think that's interesting. One of the other takeaways real quick is you only need one or two, forget the word inside. I'll call it secrets in the Peter Thiel terms, right?

You only really need to understand one or two secrets in your lifetime to become fabulously rich. And this is one of them. For example, this is a good example of one. I think Peter Thiel did this with network effect businesses, so understanding, you know, PayPal, Facebook early on, and just understanding, like, the power of a network effect and how unbreakable those monopolies become.

And then, you know, the other, you know, another example is, you know, Buffett, for example, he doesn't invest in network effect tech companies or anything like this. What he looks at is what's not going to change? And he's basically like the moat, which is the pricing power. So, you know, he gives an example of, I don't know if you saw this exchange, but Elon was talking about how lame moats are. He's like, oh, I don't like the idea of moats. If you need a moat, that's lame.

You should be innovating faster than everybody else. That's how you win. If you think a moat is going to protect you, that's not what protects you. Fast innovation is protection. This is Elon. You're like, Elon, I don't think the word moat means what you think it means. Because you definitely have a moat. Buffett replied, and he was like, I don't know.

He's like, let's say you go to a corner store and you ask for a Snickers. And they say, hey, I got a musk bar for 10 cents less. he goes, I don't think anyone's buying the musk bar. And he's like, in fact, if you go test this, if one place doesn't have a Snickers and they have an unbranded, unlabeled chocolate bar with peanuts in it, but the place across the street has a Snickers bar,

the customer will just walk across the street and go buy a Snickers. And he's like, so yeah, he's like, I look for Coca-Cola, Snickers, you know, Gillette, American Express. I look for these brands and franchise, Apple, I look for these brands and franchises where you'd have to pay someone to switch.

And even then they wouldn't want to. He's like, that was his core inside of like, he just need to find these great American franchises and invest in them. Did you see, I want to bring up a person who we talked about somewhat recently, we wouldn't dive into, but really quick, did you listen to the Lloyd Blankfein interview that we did, that I did with, and he talked about like his family finances and stuff like that? No, I only wish, I've listened to the first five minutes, but I'm on vacation. So I hadn't had time to, like, get my phone and listen to it.

What did he say about his family? By the way, did you know this guy before? Am I dumb? I never heard of this person. And then you were like, all about this guy, suddenly. Well, when you and I were younger, probably in high school, that was like his peak prime. And so like during the wall- So you knew him back then or only now?

I knew him as a famous, like, he was like the face of banking. He was like the Jamie Diamond of 08, particularly when Occupy Wall Street was a thing. He was like the face of evil because like the name- Goldman is like, and there was this funny line that he told me where he was like, yeah, they like protested outside of my house and everything. And I was like, how does that feel? He's like, well, two things. Like, one, like, go and try to get a mortgage from Goldman.

Like, you can't. So, like, I didn't cause the mortgage crisis. So I don't know why they were so angry at me. And second of all, they, you know, we're camping outside of my house protesting. But like, that's what doorman are for. He's like, I shouted out from the window on the fifth, fifth balcony in my house. We wouldn't give you a mortgage even if you tried. That didn't seem to help.

No, dude, he was super likable. He was so charming and charismatic. Basically, Lloyd is, like, you could look up his career earnings at Goldman because when Goldman went public, he was like 43 years old. And I think at that time, he told me, he told me his shares were worth like $160 million. And this was when he was 42. He's 72, I think now, so 30 years ago. And then the course of his earnings are all public while it was public.

And it was many, many, many hundreds of millions of dollars a year. And so presumably, I would have to imagine he's worth like $2 billion plus. But he grew up in a poor Brooklyn family. And he's somehow, and he's very self-deprecating. His father was a post office worker. His mother, I think was a stay-at-home mom. He's like a pretty like, he calls himself the blue-collar CEO. And he was like, I wasn't even that smart, but somehow I got into Harvard and they paid for my school.

And he's like, one time when I went to Harvard, I had to go to the office or whatever they call it, the financial aid. He was like, I don't have any money to eat. Like, can I please have money? And then they're like, they gave me $500 back then. And it like changed my life because I had food. And so he goes to Harvard and he gets a job as a lawyer. He's like, this sucks.

I don't want to do this. And so he gets a job at a rag tag like subsidiary of Goldman. And he's like, I don't even know what Goldman is. I don't know what banking is, but they thought that I was this like hard nose blue-collar guy who went to Harvard. And they were like, you check the boxes because he was a commodity. these trader at this little like rag tag group, which at the time was considered a very lowbrow thing. And so he slowly over the course of many years worked his way up to eventually become partner and then

CEO of Goldman. And when he was in my office, he had this very blue collar vibe where I could tell that he, it felt very authentic. He like looked me in the eye and like knew how to like riff on like silly stuff. But also I'm like, dude, you're like acquaintances with Putin. Like, you know, like he's like like, I could see. He saved in your phone as Pudy. Pudy call. Yeah. Like, I could see how this guy is charming and how he worked his weight at the top. And can you imagine being the shark in the sharks?

Like, how much, how insane it is to work your way up at Goldman amongst all the sharks and become the CEO? Can you, what does that even take? Like, that's sort of mind-boggling level of difficulty. Like, I know people that have made more money just building a company, but that's actually not as hard as playing the, like, corporate game inside Goldman. and rising up amongst all those kind of like corporate sharks. He's wild, but he came off.

Like during the podcast, I told him, I'm like, man, you are making Goldman seem likable, which like is not easy. Like you're making it seem relatable and likable. That's a very hard thing to do. And for some reason after talking to you, I'm like, oh, I can do this, even though obviously I can't. He told this story, I asked him about personal finances. I was like, hey, how does your personal finances work?

Because he told this story about how he grew up poor and he's still cheap. He was like, I buy the, is there like a cheaper? tier of Netflix that has ads. He's like, I won't even pay for that. I do the cheap one because there's something about it that like, because I grew up poor, it still bothers me. He was like, when I, he said, I think he said 80% of his net worth is in public equities of which 90% of that 80% something like that. He still day trades. And he was like, I day trade. I'm obsessed with it. I love the game so much. And I want to check my phone all the time. But like when I do research on different stocks, I'll get to like a Bloomberg,

publication or Wall Street Journal or something like that. And I don't buy the subscriptions because like it kind of hurts me to like pay for it. And I just thought that was incredibly fascinating to hear like how a billionaire manages their finances. How billionaire mismanages his finances is what I heard. Well, he did the right. None of that makes any sense. The top. I wasn't there so I could talk shit. If I was there, I would also be like blushing and saying how great he is. But you know, just hearing it from the outside just to be the outsider for is that you're day trading a billion dollars while not paying for Netflix because you're cheap like I don't even understand what you're taught you don't pay for for for for you know premium news

the point being it's not it's not a logical thing but it was like he was kind of like saying like here's all like how I'm messed up just like the average Joe and it was so fascinating and at the end of the interview did I tell you what I try to do with him I was like hey like I have this like Instagram do you want to me like I was going to do this like your hand check well I was like I I was like, I have an idea. Like, I can, like, act like I'm reviewing your book. And I'll just be like, oh, screw it. I'll just bring Lloyd in.

Lloyd, just tell him what your book's about, will you? And he was like, he goes, I'm too old for that stuff. I'm not acting cute on Instagram. That's the most likable thing you said so far about him. I was like, oh, Lloyd, it's not like cute. None of the, like, billionaires, they're just like us. But just that would have like, I'm not going to do that. I was like, I wouldn't describe it as cute.

I mean, it is cute. But that's all, it's more like, fun. You don't like fun? He goes like, that's too cute, dude. I'm not doing that. And I was like, yes, sir. I'll walk you to the elevator. It was pretty good, but he was fascinating. And then another guy who we had a guy on the other name, Barry, who talked about David Rubenstein. Had you ever heard of him before Barry, or Barry told you about him? From Carlisle Group? Yeah. Do you know anything about this guy? Yeah. Only surface level stuff, yeah. I want to fill you in on a little bit about a story because I've actually always been a fan of his,

but I mostly knew him as an author of history books, not particularly of like a business guy. And I was researching him. It's pretty fascinating. And he's kind of like my new man crush a little bit. He kind of like got his foot in the door because when he was in his 20s and 30s, he was a lawyer, but he quit being a lawyer because he wanted to work for the Jimmy Carter administration. And he like made a joke where he was like, when I joined Jimmy Carter, he was up by like 31 points. And then he eventually won by one point, and Jimmy Carter went to David and was like,

so what contributions did you make? And so he like has like this kind of like funny, self-deprecating humor. But he like worked for Jimmy Carter. And it eventually, Jimmy Carter was a one-term president. He doesn't get it reelected. So David Rubenstein, he's 31 years old. He's like, well, what do I do now? And there was this amazing article that I found written by Michael Lewis.

You know Michael Lewis, the famous author. He wrote this amazing article in 1993. called the Access Capitalist. And it's a 10-page or so article written about David, and it's from a while ago, and I love that. And he said, David got his start using what people are calling the great Eskimo tax scam of 1987. Tell me what.

So the story is basically David had this amazing rolydex. He was really well connected. In Washington, D.C., he was known as being likable and like a really good networker and reliable. And so he just like knew a little bit of everyone. And so he's out of work at the age of 31. He's like, what do I do now? And he hears about this like weird tax loophole where if you were a native of Alaska,

you were given a certain amount of tax losses automatically. I don't know why. I think it was like to incentivize people to live there. And so what he did is he organized a bunch of buyers and sellers, meaning if you want it, they could sell 10 million. dollars in tax write-offs to willing buyers for seven million dollars in cash and thus the buyer got a reduced taxable income of three million dollars and david like heard about this and he's like that's interesting and so him and a couple friends organized roughly two billion dollars in these like in like organ and uh

transacting these tax losses and after doing that for two or three years they had made something like $20 million, and that's the money that they used three years later to eventually start Carlisle Group, which is now one of the largest PE firms in the world. I believe they have $500 billion in companies that they own. And David was like, I thought I had a pretty good IQ myself, but I was seeing a lot of people make a lot more money than I was who I thought maybe weren't as smart as me. And so I decided to try this PE firm. And so he raises a little bit of money, uses the money that they made from the the tax saving scam. Scam. Sorry. No longer. I guess he just canceled his booking with us.

Scheme. Never friend of the pod. Scheme. I meant to say scheme. It was cold outside. I meant to say scheme. And he used this thing and he started in the P.E. business, which at the time in the 80s was like, like just killing it. Like, it felt like that's when all the big P.E. firms were built because this idea of a leveraged buyout was brand new. and so he raised a little bit of money and he like did a couple of deals it didn't really particularly work that well I think he said his first deal

that they tried to buy was a Mexican restaurant called Chi Chi-Chi's and he's like yeah like it wasn't going so hot he went from the Eskimos camp to Chee-Chis right? Yeah he's like not doing so hot but then he had this idea where he was like

well like I know everyone in DC and I know that like a lot of jobs in DC are pretty cyclical like after four years so you're like quit and you're like, what do I do? And I know a bunch of interesting people. And I know those interesting people know a bunch of interesting and powerful people. But you don't want to like sell access to these people.

That would like be borderline unethical and sometimes illegal. And he's like, well, what if I just like got all of these like powerful people who no longer have jobs at the government to come and like work at this PE firm? And we start or when we start buying companies where it would help to have like friends in government so you can get meetings to like big powerful companies. And so Carlisle eventually specializes in defense. contract style companies. And so that is sort of how it took off.

But the more interesting part about all of this is what he's done while he was building the company. So he has like five or six books, which is how I've met him or know of him. So he's got a book called like The American Stories about like where he just interviews historians. He's got a book called How to Lead, the American Experiment, How to Invest, the highest calling, which is conversations about different presidents. He has a show on Bloomberg called the David Rubinstein show.

He's got... Yeah, that's what I've seen. His interviews are great. He's got all this amazing thing. But listen to this shit. He owns all this amazing stuff. He owns one of the... I think it's one of the last privately owned copies of the Magna Carta, which is one of the most

historical documents of all time for $21 million he bought it. He owns one of the last pieces, one of the last bits of the Declaration of Independence. He owns a Lincoln signed Emancipation Proclamation. He funded the Washington Monument when it needed to get rebuilt. He funded the Lincoln Memorial. when it need to get rebuilt. He funds all these amazing things. So, like, the Kennedy Center, he helped do.

He helps produce a lot of Ken Burns documentary. He funds him. He's just, like, this crazy guy that does all of this interesting stuff. And his side hustle is basically, like, buying these documents, meeting the people who are, like, around the documents, writing books about the documents, becoming on the board of the museum in which he loans the documents, too. And he just has this, like, crazy. That's fascinating.

I mean, that's an epic chakutory board career, you know what I mean? Like, just a little bit of this, a little bit of that. They work well together. You know, he's kind of like the white knight of Washington, D.C. I kind of love it, you know. Like, I always love people who are not sort of one-dimensional in the way they operate. You know, the one-dimensional people, I appreciate for their laser focus and obsession, and I take inspiration from it.

But I don't take guidance from it. You know, I take more guidance from people like this who I think have a more interesting, varied career. Personally, I find that like just really compelling. I love this guy. Google or go to his Wikipedia page and like look at the things that he's contributed to. I mentioned just barely any of them, but it's like...

He owns David Beckham's wisdom teeth. Like, we just play a game. Things, you know, two treats and a lie. Rubenstein's collective collectibles. Dude, it's so awesome what he does. And I just think that guys like this are really cool. And he's actually coming on the podcast.

in August. And so, you know, sorry, Dave, I didn't mean to, I didn't mean to insult you if I got any details wrong. But, well, he's coming on. Okay, I'm so excited now. That's amazing. Yeah, it's amazing. I think that he's been doing this kind of like baller giving philanthropic stuff and like history stuff. I think he's been doing it along the way and not just like in the end of his career, which I find really fascinating. And he like makes this joke where first of all, he says like, my whole schick is I love self-deprecating humor because it disarms people and like he's kind of like a, a self-deprecating guy, which makes him very likable. But he was like, I'm not really like that good of an investor.

I just like work pretty hard. And I know kind of everyone and I'm pretty good at connecting people. And I also have really good business partners who's helped me start Carlisle. And that's one of the reasons why it's the way it is. And I thought that was really fascinating. I like that a lot. It also sounds like he had, you know, a cool second act to his career, maybe a second and a third act to his career.

Today's podcast is brought to you by my friends at Mercury. They make the world's best banking product. I think you know this already. I use Mercury for all of my businesses. I think I have like maybe seven or eight businesses. We use Mercury as our business banking across all of them. And now they actually just launched a personal banking account. So I have my personal account there.

I moved off of Wells Fargo and Chase. I'm just all in on Mercury. Why, I like products that are easy to use. I like products that get me and the problems that I have. So like very easy to make a joint account with my wife. Very easy to spin up virtual cards. One click and I get savings yield. It just has all the stuff that I need.

in one place. So if you're looking for the best banking product on the market, it's definitely Mercury. I will fistfight anybody who disagrees with me on that. Go to Mercury.com slash personal and learn more. Mercury is a fintech, not an FDIC insured bank. Banking services are provided through Choice Financial Group and column N.A. Members FDIC. Can I tell you about a business that I think is really cool that is someone's second act? And I think you know, I think you know the person, but I don't know how much time you spent thinking about this business. And so the business is, you know, PSA. And PSA is, if you ever want to go buy a rare, you know, Charzard. Well, you want to know the PSA grade of that card. And so they created...

Yeah, so Nat Turner bought this business. And Nat Turner, I think he, I think his last company was like in health care, something he sold it to Roche. And he's always been a nerd, a collector. And he raised some money and he took private or he bought this company, I think it's called Collectors University. or something like that. They own PSA. And I just found this category of business to be pretty fascinating. So let me tell you a little bit about this business. Here's one way of looking at it.

So it's a business that controls something like 70% of its market, so absolutely dominant in its market. They have $400 million of orders just sitting in the queue. How much? How much? How much?

Four hundred million. What? If I'm wrong, we'll fire our researcher. But that's what we have here. What are going to get a cancel your cloud subscription? Oh, give Claude, I'm nasty talking to. Basically, they've dominated this space of grading cards. And if you think about what that is, the broader category of problem that they solve is something called credence goods.

And so I was kind of nerding out on this. And what a credence good is basically, it's a good that even after you've consumed it, even after you have it, you still don't really know the quality of it. So, like, medical care is a good example. You have surgery. Oh, how'd you like your surgeon? I don't know. I have no idea. I have no way to assess the efficacy of my surgeon if they were, if they were, you know,

I could probably tell if they're terrible, but I can't really tell the difference being good, great, and world class. And the same is true and the same was true for collectibles. So let's say somebody had an original, I don't know, Sammy Sosa rookie card. And the big kind of home run boom was happening when him and Mark McRoyerweiler were hitting a bunch of home runs. And people were buying up these cards. And the problem without a third party, a trusted third party here is that one, you know,

the owner says it's an excellent condition. And then they show it to a buyer and the buyer says, I don't know, it seems fair. And then the buyer owns it. Then he says it's a mint condition. And there's all this arguable. And that's just the condition, let alone, is it even authentic? Is this real? Was this actually a first edition?

Is this a second edition? Does this actually have this? Does it actually have that? And so you need third party trust in a system. where there was no structure. And so coins was like this, cards was like this, Pokemon cards, sports cards. And so there was this entire industry of collectors

who were very passionate, but they had no structure and it needed third-party trust. And this exists in many industries. So, for example, if you ever go through an M&A process, you'll have to go get a QOE or you'd have to get a third-party audit. Deloitte, Ernst & Young, they built multi-billion-dollar businesses just doing an attestation, just saying, yes, this company's financials are sound so that the seller and the buyer can do a trusted

transaction because the buyer knows that they don't have to go and verify themselves that the company's books are actually what they say they are. And so attestation, credentialing, these are huge businesses that are just some of the most beautiful business models because you become basically a trust tax on an entire industry. You don't have to be the best buyer or seller. You don't have to own anything. It's super capital. light, all you have to do is become the trusted third party. And that's hard to do. But once you do it, it's an incredible position to be in. And I think what Nat Turner did, buying this company is absolutely brilliant. I think they bought it for $800, $900, $9 a million. This is going to be a multi-billion

dollar company because being the dominant market share, and there's a network effect, right? Like, if I have a card that I think is valuable, am I going to go to the third rate greater because I can save a little bit on grading my card? No way. I'm going to go to people. I'm going to PSA, because if it's PSA certified PSA 10, that makes my card more valuable. And so the trust sort of compounds, and it becomes the known unit of account on the street. You see everywhere you go, you're just going to keep seeing PSA, which means when you need to get your cards graded PSA. And then they add it on top of grading. They have a vault. So they store a million cards in their vault because they're basically like, you know, a hybrid. It's like, you know, one part moody's

where they're grading asset class. And on the other side, they're Fort Knox. where they have this giant vault storing a billion dollars worth of cards or whatever it is in their in their vaults. With this business, so I'm just looking it up. So like it's called collectors.com now. It's like a it's like a portfolio. I think they own like the ones you mentioned plus like three or four other ones. And the like they have this cool Jackie Robinson card like on their photos. And it's created by Tops, Tops cards.

When I was like, you know, I bought so many of those. And Tops is owned by Fanatics. Because it's not like a regulated thing, it's not like money or gold or anything like that. What's to stop fanatics from making more... Like, it's not like a limited supply. Do you know what I mean? And it's not like... Incentives is what stops, though.

So it is a limited supply. If tops can't be trusted to not flood the market with more cards, people will stop buying tops. The more supply there is, the less valuable each card is. So, Tops has an incentive to... to control the supply tightly, to manipulate the supply artificially. And so Topps has an incentive to do that.

That's in line with the incentives of the buyers and the holders, because they need scarcity for this to be valuable. And then PSA sits as a layer underneath both, which basically grades and authenticates that this is real. It's not a fake card, and that it's in good condition and it's valuable. And they also, because they see so many cards, they know the absolute scarcity,

so they know how many of these cards really are out there circulating in the market. They know the liquidity of each card market. So there's like a market cap for like Charzards. There's a market cap for Jackie Robinson cards because they know how much liquidity there is, how much circulating supply there is. They know the relative value of a card because they know, wow, this is in mint condition versus this is in good condition.

And so they're all kind of in cahoots with each other. and in a way that is symbiotic. It's sort of like, have you ever, like, seen how McDonald's does the, like, Monopoly game? Like, the way the Monopoly game works is there's only, like, four or two winning pieces, and, like, they guard it, like, kind of, like, crazy, although they were scammed once. There was a total documentary how they were, like, one of their, like, janitors. Guys on the inside, yeah, yeah. They, like, took them.

And so it would be very interesting. Like, they found the, like, the corner of the office where they kept them, and they're, like, you know, yoink, it's mine. I would have loved to know, like, when they're making these cards. They must know in advance which ones potentially might be valuable and how they place them in a pack. Because they're just like in little like bubble gum like five dollar or five card packs, right? Yeah, I would love to see that. Yeah.

Dude, Nat Turner was 35 when he did this. So he had recently sold Flatiron Health. I think that's what it was called for, I think like $2 billion in 2019. So you must have sold. So I think he sold one company for $40 million when he was 23. Yeah. It was an ad tech company. I forget what it was called, but it was like a cool thing, whatever.

He sold it for $40, I think $40 billion to Google. Then he starts this cancer thing because someone in his family, I think, was sick. And him and his partner, I think his partner is Zach. They're like whip smart. Like, you could, I could just tell, by the way, Zach is like kind of a feisty guy online. And he like, he's very sharp with his words where you see guys talk like this. And you're like, that's not someone I want to argue with because not only is he sharp, he's argumentative and he won't back down. Yeah, he calls bullshit.

Yeah. And so this guy, Nat, seems like a little bit more of a nicer version of that, but still has it. He seems so smart and wise at a very young age. I've been very fascinated by him as well. And I also thought when he did this, I was like, huh? Like, it was like totally like, I don't, like, that's, and then you go to the website and you're like, this is, this is awesome. This is good for the soul. I mean, the math on the, just the queue alone, right?

14 million cards in the queue. The price to grade a single card is, you know, 20 bucks on low end, thousand plus on the high end, let's call it like 30 bucks on average. So 14 million cards in the queue times is 400 million sitting in the queue. It's probably more if you think the average cost of the card is higher. And so if that's just their backlog, and by the way, this is one of the reasons he bought it was because there was a one year weight to grade cards, he's like, dude, this is terrible. And so he bought it to try to modernize it with technology, with efficiency, with just intensity, and say, like, we have to be able to do better than that. And I'll take it

public again once we've implemented like a more tech forward approach to doing this because you can't just have like a multi-year backlog and cards waiting to be graded. If you go to his Instagram, it's called Nat Turner's cards and it's just photos of him showing off his card collection. Like he owns like what looks like a Yao Ming rookie card, like a rookie card. And it's just him showing it off. This is so cool. I wonder what their office is like. This is awesome. The Yao Ming rookie car just for some reason got me. Yeah, I don't know.

I don't know what their office is like. I don't know what they're, I don't know what any of it's like. I just think this is kind of an amazing move. No, I never met him. I'd love to have them on. I think this would be really fun to kind of get it. I also just think this is my sickness, my disease. Anytime I discover a great business model, the envy in me is like,

ooh, how do I have one? I want one. And so there's a question of like, where else are businesses like these? or where could you build a business like these? And, you know, my brain goes into, like, human capital. So, like, how do you, like, for example, could I create a PSA grading system for the top 1% of Ivy League graduates? Like, could I basically score them in some way?

Could I do this for sports, right? Just like they do with the combine and the NFL or NBA? Like, could you do this with youth athletes? Like, basically, where would there be an aligned set of incentives? The demand for it, they want to have structure and a sort of a scoring system that can be trusted by all parties. And where's the economy big enough? Like, you know, collectibles was a big enough economy. I think it's like a whatever, $10 billion-ish industry.

It was big enough to support these types of revenues. And so I wonder where else you could build one of these, like third-party trust, third-party grading systems. Dude, but there's also, I mean, you're just. scratching the surface which different collectibles. So if you want to get really nerdy, I'm part of all these like vintage denim communities online and people will post, yeah, look, if you're going to say this guy who's got an Instagram

who's 38 years old dedicated to his magic cards. For some reason, it was cool when he did it. But when you said it, I felt differently. What, you don't like Lee Jeans from 1947? But there are all these like things. Like, they do this for purses and handbags, too. When you appreciate denim, is it a, like, with wine, you're tasting it, with, you know, colognes, you're smelling it. What do you even do?

Is it a feel? Is it a smell? Is it a look? What do you even look at, what traits do we even evaluate the premium, the best stuff is the worst stuff? There's all types of terminology. You want to look at the honeycombs, which is the fading that's on the back of the knee. You want to look at the back patch near the butt. You want to see, does this patch, is it made out of cardboard and paper, or is it made out of leather?

And has it shrank a little bit or not? You want to look at, are the copper rivets just a little bit green so you know it's real copper? Are they hidden or are they visible? Is there like a famous pair of jeans, like the Honest Wagner baseball card or like the rare charzard? What is the most valuable collected denim? Yeah, so Levi Strauss was invented. Levi Strauss was a man. he invented it in the 1800s to help gold miners in San Francisco, so California and Nevada.

And so if you can find, it's called buckle back, so where they have the buckle on the back to like, it's called like a cinch. If you could find any of those in an old mine and assume that's, and you can date it to the 1800s, those could be worth 20 grand. And so collectors, particularly Japanese collectors, love them. But then there's this whole subgenre of people who make reproductions. predominantly Asian companies, Japanese companies, they're the ones who make the best ones. Japanese replicate American shit so good. I'm wearing a pair right now of Levi's.

Stand up. Stand up. Let's see it. Let's see them. Look at this high rise. Give us a toral. Give us a toll. This is high rise. Look at the roping. The roping. This is beautiful roping fades. That's what you're looking for. You're looking for that chain stitch hem.

That's not made by a normal sewing machine. That's made by a union machine. They don't even make anymore. Oh my God. Three men died hemming that. Yeah, you got to find that cost $70 to get hemmed, okay? You got to find that good, good. And it's actually quite challenging.

And so like a 19- What is the most expensive denim art piece you've bought? Are you a buyer or are you just a casual? No, I'm a voyer. I'm a voyer, but like $500 for like a vintage jacket. Have you considered, have you been tempted to be like, ooh, 15? Sarah. Do we need that 15 grand? Do we need to go on vacation?

I have. So there's like a pair of 1947 Levi's that use like the green for the pockets because back then we were like provisioning out materials. And so every material was green for the war and getting some of those real deal. You know, the real deal, holyfield ones. Yeah, I want those stuff. But my point is, is that there's this whole subreddit dedicated to two things. One, looking at the fade of your denim. It's called Reddit raw fades is what it's called. So that's raw. denim that fades nicely. I swear to God. It's literally just photos and photos of photos. I don't think you're lying. It would be hard to make the same. It's beautiful. But I do know there's people who do this for other types of clothing, which are far more desirable, like purses. So you're saying you

could do niche PSA if you, if you, if you specialized in different clothing, you know, clothing and bags, yeah. Denim is too niche, but like. But maybe there's a long tail of things like denim. Well, particularly handbags. I've seen this all the time on handbags. like on eBay and stuff. Like I bought my wife like a vintage one for like two or three grand, and I'm just trusting the person's eBay profile that they have like five out of five stars. But yeah, there's like a bunch of like cool collectible like genres that are still really prime for some of this stuff.

Yeah. So by the way, like I know it's amazing that like a woman has decided to marry me even though I'm still into this stuff. But we exist, guys. Oh my God. Nat Turner, obviously we're nerds as well. If you'd like to come on, we would love to have you.

Nick Lee, Rubenstein, Nat Turner. Come on the podcast, guys. Don't we seem like a good hang? We're not weird. We've insulted ourselves just as much as we've insulted you. So it's like, we're good. That's something. You should wear a white tank top.

more often. I think that it brings out something special in you. Should I just go skimpier and skimpier with each episode? I just saw the flex on the shoulders. Congratulations. It seems like, by the way, for the past two years, everyone is commenting about on your body every single episode. That's great. Love it. Yeah. All right. Keep it coming. Go to Spotify. My click farm in India, who is continued to comment on how much better I look and how I'm getting in great shape and it shows. Keep it up. Yeah, PSA is going to grade you.

They're going to give you a... They're going to give you a... It's fine. Fair condition. Yeah, that's fair. All right, that's it. That's the pod. 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 travel, never looking back. All right, let's take a quick break to talk about a podcast. Because if you're listening to this, you like podcasts. And what's better than one podcast? Another podcast, another podcast you should check out. It's called Success Story. If you like hearing about different success stories and hearing Q&A sessions with successful business leaders

or hearing keynote presentations or just checking out conversations about sales and business and marketing tactics, this is a great podcast for you. So check it out wherever you get your podcast.