The Pomp Podcast - #726 Find Cash Flow Businesses Today w/ Codie Sanchez

Episode Date: November 19, 2021

Codie Sanchez is a journalist and investor. She is the founder of the "Contrarian Thinking" newsletter, focused on alternative approaches to investing and cash-flow businesses. This is a special guest host episode by my brothers Joe and John from The Best Business Show. In this conversation, they discuss inflation, finding boring companies with huge cashflows, Recession-proof businesses and how to make $1,000 this weekend. ======================= Gemini is a leading regulated cryptocurrency exchange, wallet, and custodian that makes it simple and secure to buy, sell, store, and earn bitcoin, ether, and over 40 other cryptocurrencies. Offering industry-leading security, insurance and uptime, Gemini is the go-to trusted platform for beginner and sophisticated investors alike. Open a free account in under 3 minutes at gemini.com/pomp and get $20 of bitcoin after you trade $100 or more within 30 days. ======================= Ethernity.io: The world’s first authenticated and licensed NFT platform, trusted by over 150,000 members. Digital NFTs and exclusive real-world unlockables, authentic partnerships with athletes and artists. Visit Ethernity.io, where you can buy and sell authenticated NFTs from top notable figures, rights, license, and IP holders you can’t find anywhere else; the start of an entire ecosystem bringing utility to #NFTs. ======================= Nasdaq-listed BTCS was the first US-public company to secure today’s top layer one protocols. Recently, BTCS launched the beta version of its digital asset analytics dashboard! From across multiple exchanges, the BTCS Data Analytics Dashboard lets you evaluate your entire portfolio’s performance with plans to add year-end reports and yield earning on your crypto through linking to staking pools. Test out the BTCS Data Analytics Dashboard today at BTCS.com.

What's up, everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Now let's kick this thing off. First up is Gemini, a leading regulated cryptocurrency exchange wallet and custodian that makes it simple and secure to buy, sell, store, and earn Bitcoin, Ether, and over 40 other cryptocurrencies. They offer industry-leading security, insurance, and uptime. Gemini is the go-to trusted platform for beginner and sophisticated investors alike. Open a free account in under three minutes at Gemini.com and get $20 of Bitcoin after you trade $100 or more within 30 days. Again, you can go in under three minutes, open a new account at

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the btcs data analytics dashboard lets you evaluate your entire portfolio's performance with plans to enable year-end reports and yield earning on your crypto by linking to btcs staking pools this groundbreaking dashboard is currently in beta mode but you can go check it out go test out the btcs data analytics dashboard now by visiting btcs.com again btcs.com nasdaq listed company the first u.s public company to secure many of the top layer one protocols and they just launched the BTCS data analytics dashboard. You can go check it out at btcs.com. All right, let's get in this episode. I hope you guys enjoy this one. Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the

opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only. So we've been talking the most of this show about inflation. I know you spent a lot of time thinking about this also, not only from a number standpoint, but what people can do about it, right? So one of the things that I want to talk to you more about and get your opinion and advice on is like, how can people hedge against themselves or invest in themselves from a business standpoint against inflation? Forget gold, forget Bitcoin. What can they do to protect themselves against inflation

from a business standpoint? Yeah. Well, you guys got the corner rallied on Bitcoin, so I'm not even going to go on that one. But from my perspective, I think there's a couple of different things. One, first and foremost, I talk about this until I'm blue in the face, but there are all these businesses out there in the world that are doing the one thing we care about during inflationary periods, which is their cash flowing at a rate that's higher than inflation. And in fact, as inflation continues to grow, those businesses raise their prices right along with them. These are things like essential services. Think laundromats. Think the yardscaping team that you have. Think car washes. We just bought a car wash last week, or we're in a deal, hopefully

it goes through, to buy a car wash that's about $700,000. The car wash itself does $81,000 in revenue, I'm sorry, in profit a year. And the piece of land is worth about $600,000. So we're buying a business at like a one X multiple, which in the world of crypto and stocks would never happen. So the first thing I would say you could do is before you even think about protecting your business, I also think you should think about how do you cashflow in ways that are almost correlated with rising inflation. That would be what I would be doing today. And how does the average person do this, right? Because I think a lot of the gap is, hey, I work an everyday job. I get paid an hourly wage. I don't have a bunch of savings. I don't have a bunch of investments. How do they implement

advice like this? A couple of different ways. Well, first of all, if say you want to have an immediate endorsement rush and go do it today, you could start investing in stocks that do this exact same thing in small, medium business space. So there are stocks out there today. There's actually a car wash company. I'll look it up while we're on here. There's a car wash company that went public to the tune of multiple billions of dollars. They have a subscription revenue business. So if you believe in my theory, you could invest in stocks that track it. So what are the biggest stocks out there that do things that are essential, like laundromats and car washes. Then you could take it up one step from there. And you could actually say you don't have

any money. So you have $0 to invest. You might have some extra time. And what you could do is there's plenty of people with so much money sloshing around right now, they don't know what to do with it, but they don't want to be the ones to go and run and operate these businesses. So be the operator for them. If I was working a nine to five and remote, like most people are these days, I would be thinking about how could I get equity ownership in a business? Who are my rich friends or my parents, rich friends, or my rich neighbors that I could say, Hey, what if I actually went out and like, I picked up the coins for the laundromat once a week, or I ran this car wash. It's not rocket science for us. Uh, you bought it and I'll take a percentage of the

equity. Uh, and this is called value added deal structuring. It's just a fancy way of saying lots of times people who have money don't have time. People who don't have a lot of money have some time, make a trade between the two. Yeah. And people, uh, I think have gotten a little lost in the returns of crypto and some of these assets, right. And they see things going up a hundred percent in a day or a thousand percent over a year or whatever it might be. How do you think, and how did the return profiles of some of these small and medium businesses trend over longer periods of periods of time? Well, what's interesting. So I was actually looking at a deal right here. So for instance, this, this cashflow deal will do for me about a 222% cash on cash

return, which basically means if I give them a dollar, they're going to give me $222 inside of that one year period. And that's pretty wild. That's Bitcoin wild, actually. But they're not always going to do that great. These companies, the average small business grows anywhere from about 7% to 15% per year. But that is a heck of a lot better than putting it in a cash reserves account that makes zero today. The other thing is, we all know this, but nothing goes up forever. And so all the people that are only investing in crypto, or all of the people that are only investing in NFTs, or only investing in the stock market, at some point, you're going to be wrong. I certainly have been many times, I hate to tell you, it's going to happen to everybody. And you need to make sure that when you're wrong once, you have something else where you're right. And that's the easiest way to say diversify this shit. Yeah, I think no one bats 100%, right? So that's obviously good advice also. But as someone who has had the conversations of actually going out and taking the risk and saying, hey, I want to do something else. I want to look at other careers. I want to look at other investment opportunities and having that conversation with your current employer. How do you think about that? Oh yeah. Well, actually my team does it all the time. It's sort of weird. I teach

deal-making to my team. And so basically all the time, my COO Nikki came to me and she was like, how can I get red share equity on this deal? How could I come into this and actually take a percentage of the profits? And here's how the conversation would go if I was in your shoes and I have been. I would say something like, okay, boss, typically I do X, Y, Z for us. I'm going to take on this new task that's not at all related to what I do. So let's say we have a new product and we want to market it. How about I do online marketing for this product? I will charge you zero dollars to do it, meaning I'll take on the project for free. And you only pay me if I am able to grow the product above what we already think the product is going to grow by us launching

it. So I basically take all the risk on the front end. And for that, say, you know, I want to make sure we're aligned. I want to make sure that if I win, you win. If you don't win, I don't win. So how about I take a cut of the profits that I bring into us? And if I don't do well, you have zero risk. And most bosses are going to say yes to this. Also, I don't know how many people watching this, like what the breakdown is of what you do, but for most small businesses in the US, go look up any business you utilize and look at their Yelp account or look at Google reviews for them. They're typically terrible and very few. So if you work in one of these small businesses, that would be an easy place to start. I'd be like, listen, if we get more reviews,

we get more clients, right? How about you pay me for a percentage of all the new reviews and new clients I bring in. And that way I take essentially part of the profit share of the business. Then if you work in like a typical job where you're going into the office every single day, you just have to start thinking of yourself as a profit center, not a cost center. So how can I make my time worth X dollars to the business, not just a task. And as soon as you can do that, you can figure out a way to negotiate. Yeah. And I, I, that's an excellent point, because I think a lot of people forget sometimes how much opportunity there is out there. And there's so many different ideas you can do. And doing Yelp reviews is one that I literally would

have never probably thought of. But it's certainly something that you can make some money on and you can show your profit center instead of a cost center. But talk to me about the idea of miniaturizing real estate. I know that's something that you focused on. I don't know much about it, so I'd love to learn more about it. Well, I like finding weird ways to cash flow. But one other thing on the first thing, I was talking with Neville Medhora, copywriting course. I don't know. He's like an OG on the internet. He's been doing it forever. And I was talking to him yesterday on his podcast and he was saying, well, you know, here's what you could buy for us from us. You can buy this course for X dollars. And, you know, we used to do consulting. Now we don't do it

anymore. And I said, well, you could go out and keep trying to sell people that or Neville, what if instead, why don't you reach out to the small businesses that are located here in Austin? You're good at copywriting, which means you're good at online selling. And you're probably good at doing uh you know online lead gen bringing in new new clients and anybody who's young in our age is about a 10 to 100 x better than a boomer at doing any of this although i don't know your dad tweets at me a lot we're trying to get him off the internet so don't encourage it all right i totally can't help it so um but i think uh so i would be doing that for all of us young guns like why not go out to these services that you use all the time and and try to get them

on the internet. We talk about Web 3.0. Half the US is not even on Web 1.0. If you can bring them on Web 1.0, you can make money without putting a dollar in. Yeah. And I was going to ask, it seems like there's a large disconnect still of people that think we've transitioned to a new era of the internet where there's these DAOs and there's these communities and all these things. And people often forget that there's this large percentage of people who do not have websites set up for their businesses, right? And it seems like you've done a really good job of finding opportunities there. Um, yes, I think that's right. And I can circle back to your question too, on miniaturizing things. Yeah. Let's talk about miniaturizing real estate. No, let's talk about

it because I, I honestly don't know much about it. I think it's fascinating. I know you talk about miniaturizing, uh, homes, small homes, uh, mailboxes, uh, pet hotels. So just tell me a little bit more about it. It's so fun. Um, so basically I think we've all realized this, but making money is just a game, right? It's just a game. And you just try to find what sport you're better at or have some unique advantage. You know, if I'm 5'2", I'm probably not playing basketball. If I'm 6'4", maybe I am. And so in the world that I like to play in, I go and find weird people that make money doing things I would never think about that I think they're smart, but I don't think they're geniuses. So I could probably replicate it. So I have this friend,

Lisa Song Sutton. And I think I just put a tweet on this. So if anybody wants to see it, they can see the full breakdown. But essentially, I was like, Lisa, what are you up to lately? She's always got weird deals going on. She's in real estate. She goes, you know what? I just bought a postal service company. And I was like, can you explain that to me? She's like, you know, you go to UPS or FedEx and you like to send out your, your, your mail. Right. And I was like, Oh, I guess maybe there's money in shipping. That can make sense. A lot of Amazon going on. She's like wrong. It's not where the money is. The money is actually, and think about it like storage units, you know, lots of people invest in storage units now, but miniaturize it into

PO boxes. And she's like, so each PO box, I charge somebody 20 to $30 a month to use this PO box. And since we're all now on the internet and remote, we maybe don't want, you know, weird people on the internet to know where we live. So we send it to a post office box. And so she's like, so I have now a thousand post office boxes in one tiny thing. I mean, the size of my office, so small. And she's like, and I make, what were the exact numbers? She makes $22,000 a month in tiny steel storage units off of, uh, this deal. And the cool part is you don't want to do a franchise with UPS and FedEx because they only let you to have 300 mailboxes. This one allows you to have a thousand. Um, and how much, how much labor does that require? How much labor

does a deal with that require? Is she checking the PO boxes all the time? Well, with 22 K in profit, you can actually have a nice little operator in there. We're talking about a couple hundred K a month. Um, so she actually hired one of her friends who was a cocktail waitress and tired of cocktail waitressing on the Vegas strip. I can't imagine why anybody would get tired of that. And so she basically put her in instead and said, hey, why don't you take off the stilettos and you can come and run the store. And basically we can hire somebody to be the daily person in front of the store, but you can manage it and we can open a couple of different locations. And so now Lisa sometimes parades around there doing different things, but for the most part,

she's out of the business. And if you think about it, it's the same thing we've done in real estate historically forever. You know, first we had like, well, not first, but we've had a lot of really big buildings, like industrial scale business buildings. You used to only be able to buy if you were, you know, titans of industry. Now some normal people can buy it. Then we went a little bit smaller and it was like commercial buildings. Like, oh, you can only buy those if you were a titan of industry. Then it was like strip malls. And then that got commercialized. And then we went down to multifamily units, like apartment buildings, et cetera. And then we went to single family houses. And then we went to storage units and then maybe we went to boat or

RV parking, which I've invested in some of those. And then it's like, how else could you take it smaller? So I thought mailbox money was a cool one. Uh, I also talked about one that's glamping related and one that is for tiny pets. And we could talk about either of those. Yeah. Why don't we go through both of those? Cause I think people, this is a fascinating concept, right? And you're, you're totally right when it makes sense from going down to large commercial buildings all the way down the spectrum. Uh, but maybe let's start with glamping. Are these just like really nice campers that you're renting out to people? So that's where I thought the play was. I thought it was like hipsters need to be in nature. And so we want to get some vitamin D and

we could sell them an experience in a glorified tent for a couple hundred bucks a night. But the play that I thought was even more interesting is another girlfriend of mine, Kate Hancock. She, I asked her what she's up to lately. I just like to ask my rich friends, like, what are you doing? And then maybe I could figure out how to do something similar. And so she bought some land in Joshua tree. She told me, which is located in California. And at this point, there's going to be a bunch of people that are like, this is the problem. stay out of the national parks, but like pick any national parks surrounding area. She bought a national, she bought a Joshua tree and she bought for about $15,000,

10 to $15,000, three to four acres. And first of all, I thought that sounded ridiculous. I'm like, you can get land near a national park for that cheap. Yes, you totally can go check on Zillow and Redfin. I was dubious too. So she bought this land and then all she did is on each parcel of land, you can do something on a site called hip camp that also now exists on Airbnb, where you list camping sites, no toilets, no tents, no airstreams, people come and they rent the ability to camp on the land from you. And each acre, you can have seven to eight tents. So she took 15,000, let's call it $10,000 to make the map easy, easy. And she makes about a $1,500 a month on one acre of land because she has six to eight campsites that are reserved about 70% of the time, uh,

which is wild. Yeah. See, I, I would have thought that she was putting up, uh, these massive tents and helping people with, uh, kind of the whole idea of, uh, come to Joshua tree, you'll get a really nice tent, but that's even more fascinating. I guess it, uh, it would just depend on like, where else can they find camping? If there's no other resources nearby, then that's the only one that makes sense. So talk to me about the pet hotels. Yeah. So actually the second tier pet market is fascinating, which I didn't even know what this was until we have a guy in our deal group who just was looking at buying pet hotels, sort of interesting post pandemic, a bunch of them shut down because they were not deemed essential right during the pandemic. And so he

was like, I think I could buy a couple at a discount. Let's look at the economics. So we were running through the deal with him. And, and, and the deal itself was interesting. These things make a lot of money. And for the most part, they're like starting to get resold out in cities again because we're traveling. But the part that fascinated me is when I think of a pet hotel, I think of dogs and cats, right? That like seems reasonable. And he said their largest growing segment is the second tier pet market, which apparently includes things like ferrets and rabbits and parrots and birds of varying type. And I thought about it. I'm like, well, you know, for dogs, you maybe need to have a little bit of room. For cats, you need to have less. But then

like how tiny would a hotel be if all you needed it for was for rabbits and ferrets? And so he has a segment of his business that I swear to you is literally, again, probably the size of this room and you could fit like, I don't know, 42 bajillion ferrets in here. And so the multiples are really interesting. And he bought this business, I think he's looking to close the deal, right? About 800k for the real estate, the land, but he is actually able to double the profits of the business by only targeting the second tier market. And so like you guys out there might be thinking, okay, this is interesting, but like, I don't want to be a ferret babysitter, totally reasonable. But I think the main point here is really how could you look for these weird opportunities

in the market that nobody's talking about that are boring businesses where you don't have to be the next creator of the next Dow or NFT or whatever. And the one thing I like about it is, yes dabble in that space but also make sure that you have something that people still want if the whole internet hype doesn't maybe continue at the same level than it does and that's sort of my plea for our generation so that was fascinating my biggest takeaway might be that you must have the most interesting group of friends ever that are buying campsites that are buying ferret hotels uh po boxes and whatnot i love it uh i got john here uh my brother with me john what questions you have what's up cody how are you going on man um so i got a few questions one obviously we just

went through a massive recession what industries do you think are just recession proof you talk about laundromats and car washes all the time what what industries do you look at to kind of be recession proof to hedge yourself against that well more than ever and you guys get this i think it's not just industry it's geography i i used to think that geography meant uh international like do i want to invest in the u.s do i want to invest in china do i want to invest in emerging markets Now I'm like, do I want to have zero exposure in California? The answer is yes. And do I want to have more exposure to what I call freedom markets? So like Oklahoma, Texas, Alabama, Florida. And so before even sector specific, if you're thinking about actually buying, starting a business and running one, you need to do it in markets that allow for good regulatory environments, which basically mean like protect us, keep us safe, but then kind of get out of the way. So that would be the first thing. Then the second thing that I focus on are anywhere during the recession that the businesses were

allowed to stay open. It's a really weird paradigm shift that we now have to consider that the government at any point in time could shut down your business and mandate that you lose any income source. And so I like to look at what were those industries that kept going, which is why I invest in cannabis. It's why I invest in things like laundromats because they're deemed an essential service. So there's a list of, I don't know, 35, 40 different types of businesses that are allowed to stay open. Um, and I would do that and heck another friend, and maybe I have some interesting friends, but I think as it turns out, just people are more interesting than you give them credit for. Um, and, uh, you know, I have a couple of friends

that made a ton of money on, um, oh my gosh, places to go get shots, obviously during the pandemic and swaps, like those little tents, you know, you see those popped up everywhere. you can go get a rapid test. They're making millions of dollars a year and they cost basically nothing to set up. And you set them up on the back of a doctor's insurance. So you don't even have to be a medical professional. It's, it's wild. Yeah. I've seen some of the ones that sporting events or concerts and stuff like that. And the lines out the door. I know some of these sporting events, it was literally like, Hey, if you do this, you get a discount inside or something like that. And it makes you think, right? Like that's a weird incentive. They're obviously

doing something to incentivize themselves to do that. Right. So that's fascinating to hear the amount of money that's being made. One more thing, Cody, I'm glad you brought up laundromat. So one thing that I've, I've seen a lot with people who are selling their laundromat, right. They want to basically get away from the laundromat business. How do you think about when you're going to acquire or just even look at buying a laundromat, the managers and all of that, because most of them are family run businesses and they want to stop doing it, which is why they're selling their entire business? Yeah, it's such a good question. I mean, people sell businesses for a myriad of reasons, but usually they're like sick, older, bored, need to move, right? Those are some of

the most common. And so, you know, how I like to think about buying a business is it's just a trade just because you buy a business now doesn't mean that you need to keep it forever, which is how I would have thought about buying a business even 10 years ago. I would think like now I am a laundromatter and all I do is I think about laundromats. And in reality, that's not the case. Instead, you could have a business for a period of time until you grow to the next one. So for somebody that was first time buying out and starting with laundromat, by the way, I'm not like obsessed with laundromats. I just use it as an example because it's super easy to understand instead of me explaining

like, oh, I do a roll up and I add another company and then we do a reverse merger. That's like kind of a lot. So we talk about laundromats, but it could be just about anything. But I think you should think about it as this is your first little foray. And so do you want to be tied to this business for like a year, sort of figure out the business and then get somebody in to operate it for you. So you can keep a little bit involved, maybe not that involved, or do you want to scale it and have four or five or six or seven or 20 laundromats? And then you build a business on top of it. And then you can create, get creative.

Like we invested in one here in Austin called the fold and most laundromats are used at about 30% utilization. So lots of empty laundry machines, they took it up to 70 because they add wash and fold services to delivery to apartments. And so, um, you know, you can add lots of different types of businesses, but I would just ask yourself, do I want to do this for what period of time? If not long, can I get an operator in place or can I sell the business? All right. So Cody, talk to me about some of the side hustles. I know you're super interested in, you spend a lot of time thinking about side hustles, how people can earn incremental income on top of their current job. Tell me some of your best ideas there. Yeah, totally. Well, we have this, I kind of

have this belief of our mantra at Contrarian Thinking is civilize the mind, make savage the body, build the bank account. And so the thought is, you know, start wherever you are. So if you can buy businesses now to diversify, awesome. If all you can do is start with a little side hustle to add to your current income stream, awesome. If all you have time for is just to renegotiate your salary where you're at in order to get more income, awesome. But the goal is that we move towards this sort of free human, this financially free human that can think for themselves and act for themselves too. That's the whole sort of frame. But let me look, I put some of them together, but one of the ones that I thought was fascinating that I saw the other day. So I don't know if you

guys have this in Florida actually or Miami, but I was in California and San Diego and all along the beaches, there are these little pop-up picnics. Have you guys ever seen that with like the umbrella? And then there's a little stand. And basically what they do is it looks like a beautiful little Instagram worthy moment. But there are humans who set up this picnic for you. So if you're going to propose to somebody or take somebody on a date, there's like champagne waiting and little fluffy pillows and those silly umbrellas that people want to use. And I got curious. And so I went up to them and there were these two guys and they were both Mexican immigrants. And they were like, yeah, we started this business on the side. One was in architecting school and one was, I don't know, maybe marketing. And they were like, yeah, we started this business.

We now make $7,000 a month by putting together a few pillows, like a little charcuterie board and a couple of different umbrellas for people. And we set up three. So they do three different segments each day. You can do morning, afternoon, or evening. And they charge anywhere from $100 to $300 for the setup. And they rinse and repeat. So it's their weekend side hustle.

And I love this business because you don't need a lot of overhead. You don't really even need permission. people will immediately yell like what about permits what about insurance but i think in most businesses like how many of your friends do you know they're like i'm gonna start a business so i went out and i got my insurance to start the business today like nobody does that so like you start where you are and this one i thought was fascinating so now they make you know whatever seven times 12 is a year if you one of the things a question we asked a few weeks ago which the uh people in the audience were fascinated with and everyone's giving their own opinion if you if i

told you this weekend, Friday afternoon, you had to go make a thousand dollars in cash by Monday morning, what would you do? Do I have anything like any, we'll call it incremental income. Basically you can use a couple of dollars to buy some goods or some tools that you need. But basically, yeah, you just got to go earn a thousand dollars. You can't set up a structure. You don't want to set up something that's going to last. It's just as quick as you can. A thousand dollars. Yeah. I mean, I don't hate this pop-up picnic idea. I would basically, the first tenant would be pre-sale. So I would basically say I'm a pretty convincing salesperson. So I think I would probably go around on the internet. I'd do something for free, like create a free Instagram

account and basically offer, you know, something could be a pop-up picnic. It could be, um, could be like a, a cool dinner that you set up for people, but I would have set up an experience because people are craving experiences right now, post pandemic. And if I wanted to, I could make definitely more than a thousand bucks by just saying I would steal pictures from other people's events. Like, Oh, here's Cody Sanchez picnics. And I'd steal pictures from other people's picnic. So I don't have any of the stuff. I don't have any money to buy the stuff. But I would put it out and I would target towards people who were located in the park before. So you know how you can check the geo-targeting in Instagram. So I'd go to like here. I'd be like, who is at Zilker

Park? Here's a bunch of people that look like they were there recently. I'd probably ping 50 of them and say, I have this opening. It's my last one. It's on Saturday. If you want to, I could set up this beautiful picnic for you that mostly celebrities have, including some champagne. Maybe that part's free on me. It's very cheap, $200. And I'd probably do that, you know, seven times. And by the end of the weekend, they would probably prepay me for it. So I'd have all the goods. I'd set it up and we'd be good to go. And then you'd probably upsell them into something else like, oh, you're going to propose to your girlfriend. Do you want this wine? Probably not. That would look really cheap, man. You should probably go with this instead. So maybe this

is recency bias, but I like that idea. Well, let's clarify something real quick. When I was asked the question, I said that I would go beg a local golf course and let me caddy and try to make a thousand dollars. So it sounds like you're going to be making a lot more than I'm making. So that's good. That's a much better thought process. All right. I got two more for you and then we'll let you go. I know one of your friends recently had lunch, I believe with Warren Buffett. Just talk me through what they took away from that. I think whether people like him or not, he's obviously a fascinating person that has done extremely well from an investing standpoint. So just talk me through what they learned from that lunch. Yeah, totally. Funny side note. A guy

reached out to me on Twitter, a journalist from Business Insider, no less, which I found funny given the shenanigans of the last couple of weeks. But immediately I wrote a post about it very quick. And like, I'll tell you guys what he told me. But he was like, if you'd be interested, I'd definitely be willing to speak to your friend about his experience with Warren Buffett. I was like, really, man? Right after everything that's going on, you're going to reach out? And the answer is definitely no. But the world's a weird place. So anyway, a friend of mine is a hedge fund manager. He's very successful. And the part that I thought was fascinating about his interaction with Warren Buffett is I sort of imagine if I met with Warren Buffett, I would be the most

over-eager questioner of all time. And what my friend said is that instead of that, it was like Warren Buffett assaulted him with questions. He's like, first of all, who am I to answer anything to Warren? But the whole time, all Warren cared about was hearing from my friend all of his favorite ideas? What stocks are you trading? What are you interested in? Why? I don't believe that thesis. Dig down into it for me. Talk to me about like the worst trade that you ever made. What's the one that you're excited about today? And by the end of it, Alex said he was exhausted and he basically like needed to take a break because he almost felt like he had just had his insides cleaned out of all of his best ideas. And I wanted to keep that tight with me because it reminded me

it's total, what do you guys say? Like billionaire energy is not to be the one talking all the time, but the one answering or asking the questions. That's the real power, I think. Yeah, it's fascinating because I recently heard this idea from Sam Hinckley and he basically says whenever he meets someone that is one, smart and wants to make a connection with him or be friends or whatever it is, he basically says, yeah, let's stay in touch. But anytime you come across something interesting, send it to me, right? Just send me an article, send me an idea, send me whatever it is, an investment. And basically what he uses it for is one, he gets a lot of really good information. And it's kind of like a filter for him to find a bunch of stuff. And then two,

it tells him what kind of like intellectual level they are on relative to him. Right. And it shows if they're going to be someone he wants to add to his, I think he calls it his tribe. Right. Which is very similar to what it sounds like Warren Buffett is doing, which is how much information can I gain out of this relationship also? Yes. I love that. I'm going to steal that idea. I mean, every time I meet with somebody, I always say, anytime you're investing in anything, if you're open to it, send it to me. And even if it's a ferret, even if it's a ferret hotel, especially at the ferret hotel exactly um all right last one uh off the back of warren buffett you hung out with two cia agents what's going on there yeah so one of the things i'm obsessed with

and why we started contrary and thinking was i think we're all in our bubbles right maybe you guys are in a like a little bit of the crypto bubble universe and the reason that you did this business show that's really cool is you basically have now all these different types of humans in your ecosystem. And the magic actually happens not when we're all speaking to each other, but when we're cross-pollinating. And so the fascinating part about talking to these two is I was like, your frameworks are so different than mine. And the words and the way that you see the world are so different. So I kind of wrote down 10 lessons for them. I also put it into a tweet, which I guess is a thread and tells you how my mind works. But let me give you just two that I

really liked. And these are friends of my husband's because he was former sort of in that world, special forces. But one of them that I thought was fascinating was she said, the white zone is dangerous, stay in the yellow. And I was like, what does that mean? She's like, the white zone is basically when you're walking around and you have like a podcast on and you're like listening to it. And then like you end up at your destination, you kind of forgot what happened all the way through. That's a dangerous zone. And the yellow zone is when you're present and paying attention. So you're like, oh, I see that guy over here. I see what's happening there. And what I realized is in almost all our interactions and in almost everything we do, we're white zone in it.

We're like not really paying attention. And that's actually really dangerous because you can lose deals. You cannot pay attention to cues. You can like, you know, these days offend anybody. And so I like that idea of like stay in the yellow as much as possible. And then the part that I thought was interesting on top of that is she said also, I love this quote, I always regretted saying too much. I never regretted saying too little. And she's like, the chatty ones often lose. And I think that's really powerful. Maybe it goes back to that Buffett quote, which is, why do we always feel like we have to be the ones to tell everybody how intelligent we are, as opposed to just sitting back and listening to it. So there were sort of like 10 lessons, but those are maybe my two favorite. And it may be the last one being like hire XCIA people if you can ever, because they're brilliant. Yeah. I like that. John, you got anything else? Yeah. Just one more thing around kind of just acquiring businesses and stuff. How do you think about risk? Do you just look at competition?

Do you look at the geography and kind of the regulations that's happening? What do you think about risk when looking at different businesses? Yeah. So if I'm angel investing, I usually think more like that, like what could happen in the future and you know, what are those like asymmetric shocks that could ruin me? So when I invest in small businesses, the biggest risk is usually something that I can own, which is like, am I getting fooled? Is this just a bad deal? Are the financials not real? And so they're a little bit more quantifiable or math-based, which is really nice. So the biggest risks in the business overall is my ego. I have to check myself all the time to make sure I say like, do I really know this? Or am I just saying I know because I think I should?

The second biggest risk usually in a deal is not asking enough hard questions because it can be uncomfortable. So you have to make sure you're digging in enough. You don't have to be a rocket scientist. You just have to be willing to keep going a little bit further. And the third is just getting too excited about a deal or getting married to a deal. There's a reason that we see ads 400 million times on the internet, because the first time we see it, it's kind of annoying. The second time we see it, it's kind of annoying. The third time we don't even realize it. And the fourth time it's actually inner subconscious and changes our buying patterns. And so the same thing happens with doing deals. You get too close to this person, you're embedded in the deal,

you feel weird backing out. And that's the part that I think is one of the bigger risks. Completely agree. Fantastic information, Cody. Thank you so much. Where can we send people to find you on the internet? I'm at Twitter, Cody underscore Sanchez, and then country brain thinking.co. That's our free newsletter. If you want to hear any of those sort of stories about how we cashflow and you want to civilize the mind and make savage the body, that's where we do it. The newsletter is fantastic. Uh, the Twitter is fantastic. Also, it's basically all of these ideas in a digestible way, uh, on a much more frequent basis. So I subscribed to the newsletter. I have seen some of the craziest business ideas. I love it, but it's awesome

because I think, no, I was just going to say now you guys, when you see one, let's practice what preach here today. You got to tell me now. You got to send me the weird businesses. I'll write about it. I'll give you credit. But yes, I want to know all of them. Only if you do the same, if we're given ideas. I'm sure the people in the comments are going to be sending us a bunch of ideas. They're still going off the ferret idea and curious how they're going to implement that. But we'll have to send you any ideas they send us. But thank you so much for doing this. We appreciate you coming on. Thanks, Jens. This is awesome. All right.