The Pomp Podcast - David Perell, Founder of Write of Passage: The Downfall of Mainstream Media

Episode Date: January 20, 2020

David Perell is the Founder at Write of Passage, In this conversation, David and Anthony discuss the importance of writing publicly, downfall of mainstream media, what blogging did to transform the traditional journalism landscape, how the internet is enabling individuals to become a self sustaining business instead of working for large companies, why we will start seeing teenage billionaires within the next decade, and the shift in education from traditional methods to online-based eLearning courses.  BLOCKFI-----BlockFi allows you to keep your crypto, put it up as collateral, and receive a USD loan funded directly to your bank account. They do loans ranging from $2,000 to $10,000,000, and they're perfect for helping you reach your financial goals of all sizes. Visit BlockFi.com/Pomp to learn more about putting your crypto to work without having to sell it. UNSTOPPABLE DOMAINS-----Make your crypto currency payments simple and build censorship resistant websites. Visit unstoppabledomains.com and purchase your blockchain domains today! ETORO-----This episode of Off the Chain is sponsored by eToro, the smartest crypto trading platform, and one of the largest in the world. Join 11 million other traders and create an account at etoro.com and build your crypto portfolio the smart way.

What's up, everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to Off The Chain, simply the best podcast in crypto. Let's kick this thing off. David Perreault is the founder of Rite of Passage. This was an awesome conversation and one that I'll remember for a long time. In it, we talked about the importance of writing publicly, the downfall of mainstream media, what blogging did to transform the traditional journalism landscape, how the internet is enabling individuals to become a self-sustaining business

instead of working for large companies, why we will start to see teenage billionaires within the next decade. That's right. He claims that teenage billionaires are coming and the shift in education from traditional methods to online-based e-learning courses. Again, this is an awesome episode, so highly recommend you listen. Before we get into the episode though, I want to quickly touch on the three sponsors as well. The first is BlockFi. You know these guys are killing it. If you've ever had the chance to see or buy Bitcoin, Ethereum, GUSD, etc. Rather than just hold it, BlockFi lets you put it to work. They'll give you a US dollar loan to get your collateral, or you can deposit it and get interest on that account. If you deposit

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of the off the chain podcast I'm obviously a huge fan and investor so go to blockfi.com slash Pomp and check them out. There may even be some discounts and surprises when you head on over to BlockFi.com slash Pomp. Wink, wink. The second sponsor is Unstoppable Domains. It's a pretty cool name, Unstoppable Domains. The name actually describes exactly what they do. If you've seen all of the crypto related content or MetaMask getting removed from the Google Play Store, being taken down from YouTube, et cetera, now there's a decentralized way to keep and fight back against the censorship that's happening. There's a lot of companies working on this, but one of the companies is Unstoppable Domains.

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These guys are another longtime sponsor of Off The Chain. I'm a huge fan, I'm an investor, and they're probably the most underrated company in all of crypto. They got started launching in Israel and serve the outside of the United States with everything from stocks, commodities, traditional currencies, and cryptocurrencies.

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they're a great investor or trader. You can select their profile and click copy trading. When you do this, eToro will automatically mirror your portfolio to theirs. They buy an asset, you buy the asset. They sell an asset, you sell the asset. So it's pretty cool that now all of a sudden, rather than having to commit all of your capital to a fund, you can simply go on and copy the trader and eToro will automatically help your portfolio mirror theirs. So head on over to eToro.com and sign up for an account. Let me know what you think about the social trading and copy trading feature. You can tweet at me or even better, you could tweet at eToro and give them a hard time. When you hit eToro.com, let them know that Pomp sent you. They really hate getting the

customer service ticket saying that you heard about eToro through the Off The Chain podcast and that you love their social trading and copy trading. So head on over eToro.com. And remember, Off The Chain's not only a podcast, I also write a daily newsletter. You can go to offthechain.substack.com. You'll get the email every single morning in your inbox of me analyzing the news and events of the day, offthechain.substack.com. All right, let's get into this episode with David. I hope you guys love this one. Anthony Pompliano is a partner at Morgan Creek Digital. All opinions expressed by Pomp or his guests on this podcast are solely their opinions and do not reflect the opinions of Morgan Creek Digital or Morgan Creek Capital

Management. You should not treat any opinion expressed by Pomp as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. This podcast is for informational purposes only. All right, guys. Bang, bang. I have a very, very special treat here i've got david with me we've got a whole bunch of stuff to talk about um and i think that this episode is much less crypto specific uh and much more i'm going to extract as much information out of david's brain as i can um because i think that he sees the world very differently than most of you or i uh which is uh both dangerous but also valuable so let's see what uh what we can get out of this thanks so much for coming to do this dangerous but valuable

that's my new tagline I like it that's the top of my twitter bio man absolutely so all right I met David three or four years ago um and uh I was telling him earlier that he is one of the few people who I have met who we had a conversation about what potential paths he could choose in life uh he pretty much already knew what he wanted to do but he was just he needed some people just to say hey go with your gut um and then he went and actually did what he said he was going to do And, like, that's a very rare thing in life because I think a lot of people have kind of dreams and goals and things like that, but they don't actually pursue it. And today you've got a whole bunch of stuff going on that's pretty cool. So maybe kind of walk us through childhood and kind of where you get to today, and then we'll get into the fun stuff.

Yeah, so we met at a Starbucks that I walk by all the time. I think it's on 3rd and something like 48th and 3rd or 28th, 28th and 3rd in New York. And at the time, I was thinking about starting a podcast. I was living in New York at the time, and this would have been 2016. And I would intern in New York back when I was in college, and I would reach out to people, and I'd say, hey, want to get together? And cold emails, whatever, and people would say, no, get out of here, college kid. And then I would ask other people for an interview, and they would say, here is an entire block of my time. There was one guy.

He was the social media manager at Golf Digest. I'm a big, passionate golfer, and we ended up doing an interview. I'm in college, and we did it at the old Condé Nast headquarters looking over Times Square. Me, 20-year-old kid, was just blown away, and the interview went well. Two weeks later, he invited me out for a trip in San Diego, and it was one of those moments in life where you say, wow, the world can be bigger and grander, and you can actually create opportunities and access for yourself. And then when I moved to New York full-time, I said, hey, I'm going to start a podcast. And I came to you trying to say, Bob, what should I be focused on here? How do I think about this?

And we had a great conversation. We did. And you were one of a few that I went through a period of my life where I realized I don't know, but you know. And so, like, do what you already know to do, but you're either scared to do, you need to figure out some of the execution details, right? But in most of those cases, people already know what they want to do, right? And it's more of what's holding them back from doing it rather than actually, you know, hey, I have zero idea of what I want to do, right? And so maybe give us an idea of kind of from that start a podcast, right?

You've got rite of passage, kind of what was the thought process behind building a lot of the content and the various platforms around writing? Yeah. So the first job that I had out of college, I actually got by skipping class on a Tuesday morning in college, one of those rainy days where it's raining so hard that the water is hitting the ground, jumping up and going back into your shoe. And I said, you know what? I'm not going to go to class. And I wrote a Twitter thread about the future of media. And I really wanted to work for a company called Laundry Service. It was a social media ad agency. They represented companies like Apple, Beats by Dre, Twitter, some of the really cool American brands.

And I wrote this thread. CEO reached out to me through Twitter, DM, and he said, hey, want to work for us? And so I moved up here. This was my first job after college. Moved up when I was 21 years old. And this was 2016. And one of the taglines for the organization was people are becoming media companies. And the organization was owned by a company called Wasserman Media Group.

And this, the CEO was a guy named Casey Wasserman, grandson of Lou Wasserman, one of the big Hollywood names. And so basically what we had was we had an ad agency called Launderservice, a media company called Cycle, and then we had a talent agency at the top. And our whole pitch to brands, this was actually very futuristic at the time, almost too futuristic, was that you could run an ad buy not through a traditional media company, New York Times, fortune, what you would do is you would run it through an actual person, an athlete, a celebrity, something like that, and then you could use their reach as distribution. And when I was there,

I began to realize it wasn't that people are media companies, it was that people are companies. And it was getting a lot easier to convert that reach into money and then to be able to use your reach to actually build a company. And so I always had this sense and still do that reach is absolutely underrated, not necessarily the celebrity kind of reach, but I'm talking more about influence, access to people who are thinking on your wavelength because it is getting easier and easier to take that audience and build a business around it. Yeah. I think I've heard you say before, taking your social currency and turning it into financial currency, right? That's the barrier to that or the friction has drastically been reduced. And we've seen this,

obviously, on a number of cases. But there is a difference. And I think what you're highlighting here is the difference between influence and celebrity, right? And so- How would you think about the difference between those two? Well, we were talking about Alex Rodriguez earlier, right? So Alex Rodriguez had celebrity because he was a professional athlete. And the influence that he had as a major league baseball player was he was in a commercial right but alex didn't have an ability to talk directly to fans right he grew up in an era where social media wasn't very popular uh it was much more about i have a pr person that pr person kind of is the uh interface with either media companies or any sort

of positive or negative press um and so once he stopped playing it's very obvious online that he's put a lot of time effort and thoughtfulness into building those social audiences now he starts with celebrity but as he builds the social audiences he's building influence right um and now he's doing exactly what you're talking about he's created you know baseball bats and shoes and all this thing to then sell through that using his audience i don't think that you could do that with just celebrity right if you don't have the influence celebrities like awareness influences driving action and i think that that difference is uh it sounds somewhat nuanced but when you go to actually monetize celebrity versus influence,

it's way easier and much more profitable to monetize the influence than the celebrity. Absolutely. One of the things that I also think people are underestimating is how much action you can actually drive with a relatively small number of people as long as those people think

that you are unique and differentiated and they have a similar way of seeing the world, a certain kind of belief structure. And if you can actually attract those people, you know, if you look at the way that the internet is structured, if you go look at any kind of metric, the one metric that we over index on is page views. So I always think of, okay, what is everybody looking at? And then what is the big kind of dark energy in the world that people are actually missing and not able to measure? And the big one, because we look at page views. The flip side to that is that we're not able to really measure in precise ways what

influence looks like and how strong these shared bonds and connections can be online. I remember back when I was in college, I used to, as my nighttime ritual, watch the Casey Neistat video. Casey Neistat was a YouTuber, had 500,000 YouTube subscribers, and then on his 35th birthday one year. He said, I am going to make a video every single day. And he did it for something like 550 days in a row. One of the single biggest sources of inspiration for me. And I had a relationship with Casey that was so deep that I remember sometimes hanging out with people and saying, how is it that I can see you every single day? We can be in the same kinds of social groups. And yet I know more about what's happening in Casey Neistat's life.

I feel a stronger emotional attachment to him. And I moved to New York because I wanted to be like Casey. And that was one of the first moments in my life that I realized that what's called these parasocial relationships could be so strong and so powerful. Yeah. And I think part of it also is the content that you consume from both of those relationships, right? So if you almost kind of think of one as a virtual relationship and it's kind of one directional, right?

Like he's sending you content and you're consuming that content. Whereas if you and I get together for a coffee or something, it's a bi-directional relationship. We're both sending and receiving information. Well, in that bi-directional relationship, one, you're getting feedback on the content you're sending me, but you're at the same time simultaneously having to consume the content that I'm sending you, right? So it's a little bit more noise in that content consumption. Obviously in the one direction, obviously you're just consuming. But his is also heavily edited, right?

So there's a bench. There's the ability to tell a story. There's an emotional kind of channel and direction that that content is. And so although you might only spend five or ten minutes with Casey Neistat or somebody else today through the content they post online, it's very much focused on a specific kind of end goal or optimize for something versus if you and I get together for coffee, it's unlikely that one, I'm going to be able to kind of live edit the conversation and two, you don't have as much kind of input output that's a little bit distracting.

And so I think that that plays into it a little bit, but also you're choosing to consume Casey's content day after day after day after day because obviously you see something that has value there, right? And I think that's a big, big piece of it. It moved me. I mean, to watch somebody who was obviously doing what they wanted to be doing, what Casey Neistat is just really hits my soul when I talk about him because you're looking at somebody who had his first kid when he was in high school.

He ran away from home as a high schooler, didn't go to college, was working in New York as a dishwasher. and if you look at some of the work that he was doing in 2004 2005 some of the stuff that he was doing even a little bit later when the first iphone came out he was making these videos where rather than pointing the camera outwards as had basically been the entire history of film he had turned and rotated the camera 180 degrees and focused it on himself and he ended up actually telling these stories about his own life long before vlogging was a thing. And the biggest thing I learned about Casey Neistat, and I wonder if this is something that you feel with crypto,

is that you can know that something is the future long before the world actually accepts that it is. And there's a kind of dogged persistence that I really admire from people who have a belief, a definite vision about what the world is going to look like, and they show up day after day after day even though they get beaten down by the world told that they can't do it even when strife comes and misfortune happens in your life and they keep showing up and i really admire the success that he's had because of that what i think what you're talking about here is conviction and persistence right so the conviction component of it i don't know casey's exact story but i'm sure that casey didn't feel like he was the only person who saw this right he actually probably was able

to find a small group of friends who also uh believed that hey you know flipping that camera around vlogging all stuff was going to be a thing um but two is it's not how many people believe it it's how deep the conviction is that's what i found right so let's say that you know one percent of the world's population believe something well if they really really believe it i think that that makes it much easier to see well eventually everyone else will believe but if one percent of the world kind of sort of believes it but you know tomorrow we may all wake up and go somewhere else and do something else yeah a little bit harder to get uh you know kind of your head around I'm going to go do this full time and be persistent with it.

So I think the level of conviction is really important, regardless of the size of the audience. But then that leads to persistence. So if you really, really believe something, then it's much easier to show up day after day after day. And Marty Bent is the name he goes by. But Marty said to me, he used to work at Barstool Sports. And I said to him one day, I said,

what's the one thing that you learned while watching Barstool get built into, at the time, they were about a $100 million company. and he said uh showing up every day right he's like look you know you're not gonna have your best day every day but just showing up and and so many people along the way say eh i'm gonna go do something else right i did this for 20 days 30 days i'm gonna go do something else um but it's that that constant persistence i think that's really valuable and i think that is something that you're doing one kind of on all the content you're creating but also two you're now teaching

people about writing right and and the writing the part to me that's so interesting is you've really got this conviction that writing is one of the biggest leverage things that a human can do in today's world like explain kind of where that came from and why you believe that yeah I believe that writing is the biggest source of leverage that is also open to everybody anyone with an internet connection who has access to ideas and the time to sit down and put their fingers on Glass can actually publish something and reach the world with it. Now, there's a lot more to that. There's strategy and there's tactics. But what I've realized is I have seven months of corporate experience. I have no credentials to my name. I was a B and C student. I graduated from college

with a 2.8, from high school with a 2.7. And my whole life has been about, I grew up just feeling like I was stupid, like I wasn't going to go anywhere. And it was because all of the traditional system just didn't work for me. Like I would go to class, they would tell me to do things, and I can't memorize things. I'm not very, extremely stubborn in things that I want to be doing, but I'm not very good at sort of following directions and stuff. And I have some kind of just weird mind where sometimes things like go a little bit too fast, and I'm not detail oriented. And then at other times, like in certain math classes, I was like, this is going way too fast. I can't do this. And I felt this desperate yearning for the first two decades of

my life of this feeling of perpetual inadequacy. And it was through writing that I finally felt like some of the things that had always felt like strengths that I, or weaknesses that I wanted to run away from actually became strengths that I could embrace. And I felt like through this kind of creative outlet, I could publish something and actually think through ideas at a deeper level because words on a page just have infinite patience. What you can actually do is by writing things, you actually become smarter because a lot of the storage of ideas that you would have to hold in your head, you can kind of outsource them to the page and then begin to soak deeper into the ideas that you're thinking about. And so to go back to my writing journey, what was wild to me

was to have not had, you know, I was in college in North Carolina and I always felt like I couldn't meet people who I could talk about ideas with. I love ideas. I just, I'm desperate. I have this yearning hunger and thirst for new ideas, new ways of looking at the world. But until I started writing, I wasn't able to meet people who I could share that with. And all of a sudden, I would, after years, really, about two years, things began to change a little bit. The first instances of positive feedback was through Twitter when I would direct message people in New York and I would say, oh my goodness, I can meet people that are also

interested in ideas. And then as I kept on writing, I had interesting people actually reaching out to me. I've been doing this for three years, and I am now able to meet people and work on different projects with people that I never thought I'd be doing this in my life, and I'm doing it here at 25. Who's the most interesting person you think you've met? Patrick Collison at Stripe. Why? Patrick Collison is an amazing person. He grew up in Western Ireland, and he grew up without a lot of internet connection, and he came to America, started a company, I think sold it for $4 million or $5 million, and then him and his brother, I think he was either at MIT or Harvard, they dropped out again and they started Stripe.

And there's a couple things that I really admire about Stripe. One of the first things that Patrick has done is I think of him almost as an idea archivist. You know, so often we're looking for the next new thing. And what I've learned from Patrick is that there's actually a lot of virtue into going back in time and looking at the ideas that have been forgotten. One of the ideas that I'm obsessed with is if you take the difference between the year 1820 and 2020, what has happened is we've shifted from a space bias to a time bias. So let me explain what this means.

In 1820, if you wanted to go find a new way of living, a new idea, what would you do? You would try to hop on some kind of boat, and you would sail to a faraway place, and you would know that when you got off the ship, you would see a way of living, hear a language, eat foods that you never even imagined. Now, if you try to go travel the world, I always say a lot of travel now is seeing things with our own eyes that we've already seen on Instagram. So where do we find the new ideas? Well, social media creates this idea that I call a never-ending now. I was in a limo or a kind of SUV that one of my friends had called, and we were going to some comedy club on 17th and 3rd

in New York, and we were leaving from Tribeca. And the entire car ride, I was watching what was on the phones of the six people in front of me, and every single person consumed either a text message or a story from Instagram or Snapchat. And what I realized was, say we had 20 people or 20 minutes in that car, six people. So we had about 120 minutes worth of human attention that was only spent on things that were produced in the last 24 hours. If you had gone back to 1820 to a library, the vast majority of those ideas would have been produced at least a decade before or hundreds of years ago. And now what social media is doing

is it is having us much more consuming things that are made in the present. I call this the never ending now. So now the way to find good ideas is to go back in time. You go back and to get back to Patrick Halston, he's studying the Apollo program. What were they doing differently?

He's looking at some of the Silicon Valley movements like Xerox PARC and he's trying to study what were the organizational dynamics of this place that actually led to some incredible inventions and then he's bringing those ideas into the present moment at Stripe and it's one of the reasons that Stripe you walk in there it's a special place filled with energy and I don't know if there's a company in the world that more of my friends want to work for it than Stripe really yeah and do you feel like that's because it's the culture the leadership accommodation like why do so many people want to work there

I think it's the culture. They have an amazing both writing heavy and intellectual culture. They have a, yes, they are a payments company, but their grand ambition is to increase what they call the GDP of the internet. And one of the things that you see with Stripe is that it's a very kind place. And I think that that comes from Patrick's Irish background. I was talking, I'm going to go to Ireland in a couple months, and I was talking to a friend and he said, you're going to see a level of kindness here in Ireland, a jolly love that is sort of in the ether there. And I actually feel the same thing at Stripe. It's a very Irish place. That's pretty cool. Let's talk about Rite of Passage.

So you, you created a course that teaches people how to write and at the top level or kind of high level, when you hear that, I think a lot of people say like, what does that mean? Right. I took writing in school. I took English class, et cetera. Uh, I want you before you explain exactly how the course works and kind of what, what you guys have been able to accomplish so far, uh, tell the origin story. Cause I think it's pretty cool how, uh, how this came together. Yeah. So I was doing some just different consulting projects in New York. And there is a major business opportunity that will exist for the next very many years, which is productized consulting. So let me explain that. So what most consulting has been traditionally is you get hired, you're on

retainer or something, and you have some kind of problem that you're very good at solving. you go to the office of that person and you give the same answer over and over and over again I was with a friend he works for one of the big four consulting firms we're together last week and I said hey what do you do for a living like really what do you do he said well I fly to a different city every single week and I have people answer the same 20 questions about security and then we have a playbook of things that we do and so what I was doing was I was helping different people mostly financial writers try to build their online websites. And I would say the same things over and over. And I have this obsession with new ideas. So doing the same things over and over

again drives me crazy. So I said, you know what? I'm going to make a course. I had taken a course called Building a Second Brain by Tiago Forte, sort of a note-taking app or note-taking system. and that actually changed my life. Phenomenal course. Why did it change your life? Yeah, I'll tell you why. Because the best way to improve your writing is not, this is what everybody does.

And this is why people are like Sisyphus climbing up a hill when it comes to writing. Two steps up, one step back. Is what most people try to do is they look for writing books written by Stephen King and stuff like that. We're gonna go read on writing and then I'm gonna write the next great American novel.

and the the it doesn't work because really what writing what at least non-fiction writing is at its deepest atomic level is it is having interesting ideas and actually communicating them in ways that are both insightful and entertaining you do an amazing job of this right you have your ideas and you are able to explain them to bigger audiences than most people who are in the crypto world that you run in. And so once I had all of these notes in my pocket, all of my writer's block disappeared. I was able to actually not have the limitations

of my brain be a problem anymore. All of a sudden, I could actually think with the computer and use that to kind of come up with interesting ideas. And so once you go through that course, did you know that, hey, I wanna create a course or was it through other conversations? How do you get from, wow, this course was really powerful and really valuable to me to, oh, I have ideas that I want to create a course for and help others?

Yeah, so there's one thing that really stuck out. So I was saying the same things to people over and over again, and I sent out a tweet. I said that my goal in 2019 at the time was to help 1,000 people start writing. And there was this tsunami of responses. People were direct messaging me. I got hundreds of replies from people saying, I want to do that. And I took a step back and I said, well, how do I actually do this in a way that could be somewhat scalable?

Because what's great about scalability is it allows you to invest more in the thing that you can scale. So I called Tiago, whose class I had taken. And I said, hey, let's make this course. Flew down to Mexico in the last week of February 2019. We flew down a film crew from Hollywood. And we spent 10 days coming up, designing an entire curriculum for a course, putting it together. And then we have now done a couple different versions.

And each one just gets better and better and better because we have a lot of built-in feedback loops. and a phenomenal community of people who are some of the most intellectually curious people in the world. And so the part to me that's so interesting about this course, right, is if somebody comes in and says, hey, I want to learn how to write. It doesn't matter if they're already writing or they know nothing about writing. You guys have a combination of pre-recorded videos and kind of live classes or support and community. Why add those two components together? Because when I think of online courses, I think of the Coursera's, you know, the world where somebody went in a room, whether it was one day or took them, you know, a year, they record a bunch of videos,

they sequentially put them together. I buy my course, I watch the first video, second video, third video. And by the time I'm done, I've, you know, consumed the content that they, uh, created. There's no community there. There's kind of no live components. There's no ability to ask questions. It's just, again, one way content consumption. You do it the other way. Why? Yeah. I want to sort of add one thing to this before I answer that question. And I say that it's an online writing course because it's easy to communicate, but you have an audience that's really going to understand this. What we're really teaching people to do, and writing is the mechanism through which we're doing this, is we're teaching people how to become citizens of the internet.

So what does that mean? I believe that the internet is a fundamentally new way of being. It is a new way of thinking about how to connect with people, ideas, and opportunities. And what we don't just do is we don't just teach people how to write. We teach them how to actually think about what we call a personal monopoly. What are you going to be known for? What is the unique combination of skills, personality traits, and stuff that you're going to be known for?

How are you going to actually use the internet to actually reach out, connect with anybody is one of our modules. And then how do you actually build what we call an online home and these serendipity vehicles for yourself and use the internet to really advance your career? But now to answer your question, the big thing that platforms like Skillshare and Masterclass and Coursera miss is that education and learning is extremely difficult. And when you add in both learning to write and the actual act of writing. I mean, if you just think of all this mythology around writing, it's extremely difficult. And when you add in a kind of social community, it's one of the things that traditional education gets absolutely right. When you are with

peers, you work harder, you're able to actually push through things more. And the analogy that I've been using is that it's the difference between a self-paced courses of everything is pre-recorded is like a cantilever bridge. I grew up in San Francisco and during the 1989 Loma Prieta earthquake, the Bay Bridge actually collapsed. And that was screwed in with nuts and bolts and stuff like that. And the Golden Gate Bridge, which was a suspension bridge, it could kind of swing and it would swing whenever the, you know, when the earth was shaking, but it was able to stand up pretty well and that community is that suspension bridge everyone can kind of support each other and when times get difficult and stuff the whole community comes together and so not only

are we teaching people how to write together but we are producing friendships that would never be created with these self-paced courses explain the personal monopoly thing because that's a really interesting way to think about um kind of expertise or uh or branding it sounds like to some degree What does that mean? Yeah, so Peter Thiel in his book Zero to One has this very contrarian idea that all successful businesses are based on a monopoly. And I wrote a very long essay where I dove into basically the metaphysics of Thiel's thinking. And one of the things that you see time and again with Thiel is that you want to avoid competition always. So you want to differentiate yourself, and it's the same thing with what your career is.

When I was in college, I remember my senior year of college, I walked into our college job fair. This was one of those big turning points for me. Friday afternoon, and it was a hot day, just wanted to be out partying, having a good time, and I put on a suit, walked into this job fair. And there were all these companies, and you had all of these people walking around with their blue pencils, their red pens, their black notebooks, and then the same tired looks on all their faces. And there were all these companies, but they were basically from the same couple industries, right? There were these management consulting firms, investment banking, all this sort of stuff. We're told the entire top of the pyramid for undergraduate education. In 2007, half of Harvard graduates went into either investment banking or management consulting.

So what we have is everyone sort of going for the same thing. And what I say with the personal monopoly is stop doing that. Go find your own thing, your own unique combination of different personality traits. Say that you're super funny or say that you really like Star Wars. And then you also really like crypto. Then you kind of combine crypto, Star Wars, and being funny. And you're sort of the one person who has that unique combination of traits. Because once you begin to overlap skills, then you're competing with fewer people.

But this is where things get really interesting. And this is actually what you, without knowing it, did an exceptional job with. And I've looked at people like you to sort of build out this theory. There's a three-step process. I didn't know I was getting psychoanalyzed today. Go ahead. but but but basically i mean it's people in crypto have done this over and over again but what you want to do is you want to pick a small but growing market that is underestimated

so you go pick a market that like crypto that would be a very small market but we know it's growing and all of a sudden actually not knowing things flips from a disadvantage to an advantage you have a fresh perspective that the people that you're competing against don't then you go you go learn obsessively about that industry. You read everything you can, you talk to every single person, you watch all the videos, and then you learn all that stuff and you share as much as you can. And over time, you actually begin to attract people based on your own kind of learning. And the big thing there, the big flip for people is people wrongly think that you need to be an expert to write about something. No, writing is the way that you learn about the thing that then

you become an expert in. Yeah. To me, one of the things I enjoy about writing, and I think a lot of others, and I see that you do this as well, is that when you write something and put it out into the world, what you're actually doing is you're eliciting feedback, right? You're eliciting critiques. You're eliciting agreement, right? It's very much, hey, I wrote this thing. This is what I believe based on the information and facts that I have today combined with my analysis, opinions, etc the best part about writing i write every single morning is the people who respond yes and they agree or disagree right and to me that the disagreements uh are the the valuable ones because what they do is they say hey i saw you said a b and c a and b makes sense to me c doesn't make

sense here's three other data points that i would consider and rather than say c i would say you know x y and z and you're like you know what actually like maybe i don't fully jump to you know your perspective on the world but you can move me closer to that direction but you only have one brain right i only have one brain and so when you only have one brain thinking about something it's much more uh difficult and it's much less likely you're going to get kind of the right answer than if you have a bunch of people right i think it's uh what's the book super forecasters where it's basically like the crowd is much better at eliciting kind of the correct answer than just one person and writing although you're it's usually one person creating the

content, what you're doing is you're throwing it out there for analysis, right? And feedback to a very, very large audience if people are paying attention. Yes, exactly. So one of the things that we have in, it's funny that you say that because I agree so strongly that I think that in Rite of Passage, we're at the frontier of thinking about how to elicit feedback. So we have this acronym called Cribs. C-R-I-B-S. And whenever you are looking into the world trying to get feedback on your ideas, you evaluate with C-R-I-B-S, Cribs. You look for things that are confusing, repeated, insightful, boring, or surprising. Those are the five things that basically encompass everything that you say. If something is confusing, you rewrite it. If something is repeated,

you delete it. If something is insightful, you talk about it more. If something is boring, you delete it or you rewrite it and if something is surprising all good writing has a twist a kind of moment in the middle where something begins to change and just like a horror movie you build up that suspense and then you flip it and that kind of feedback is something that people with online audiences really understand that you're putting signals out into the world that you earnestly think are accurate but then at the same time you are humbled by the fact that the actual wisdom of all the people who read your stuff is is more intelligent than you are but you become more intelligent as a result of their responses for sure and i guess one of the things that you're

doing right is you're giving people a skill but you're also giving them confidence right and what that does is if you believe that every person becomes a media company or a company it's almost like entrepreneurship training to some degree right because if everyone's gonna be a media company well you need the skill and as you do that why is that important to society right to me it's I think we both agree that you know quote-unquote media is broken meaning more of the mainstream media and we can get into why that is but why is it important to society that individuals have that voice and have that ability to write and share ideas etc because there are and I've met a lot of them, a lot of them are my friends. There are some people who are

unbelievably intelligent who just don't share anything. And one of the great tragedies of the last five years is that many of the world's smartest people are no longer sharing their ideas in public. What would be some examples? Like Marc Andreessen. That's the first one that came to my mind too. You had Marc Andreessen. Tragically. So Marc Andreessen was the guy who got me interested in ideas junior year of college i was following mark andreessen and i had on twitter and i had this moment like i could either go to my class or i could read mark andreessen's thoughts in my pocket like to somebody in rural north carolina there that was magical i mean it felt like straight out of a disney movie and now the guy doesn't tweet anything except for quotes

after somebody dies and it's it's it's tragic but you know that he's in telegram groups you know that he's in other groups speaking privately and i believe that like i have a lot of students who worry that it's arrogant if they go start writing who am i to start sharing my ideas why should people think or why should people listen to me and it's kind of this imposter syndrome this kind of fear, lack of confidence, see it all the time with my students. What I tell them time and again is it's arrogant for you to do the hard work of learning things and not share it with the world. This world progresses when people share ideas.

Look around you. Everything was built by people who came before you, and every single thing was somebody's obsession, from the way that the buildings were constructed to the letters on the building in front of us, to the actual construction of the glass on the iPhone case, Johnny Ive lived for that. And if you didn't have Johnny Ive, the lead designer at Apple, actually going out and putting in with his own two fingers to actually construct something for the world to behold, it's the same thing with information. It is arrogant to have ideas in your brain that could move the world forward and to not codify them so that the world can benefit. Well, and part of this, I think,

is there's a lot of people who think they don't have ideas right there's a lot of people who are scared to share the ideas that they do have and there's a lot of people who are scared of having ideas sharing the ideas and getting negative feedback right right and none of those three things are to me at least are a big enough obstacle to not share the ideas right so they're all kind of um short-sighted uh why do you think the regular media is somewhat broken like what Like what's changed over the last, I don't know, 10, 15 years, right, where we went from the mainstream media was the say-all, be-all kind of the law of the land, if you will, when it came to content to today there's a lot of people who would just say, hey, I trust somebody else other than the mainstream media. Yeah, I've thought a lot about this. You've probably thought about it more than anyone I know, so I want to hear your answer.

I am obsessed with this question. And I think that a lot of the narrative around media is that the media has given us truth. And I don't think that the media has ever given us truth. Okay, why? The media has given us consensus. They're very different things. The best analogy for this is rowers in a boat. So if you look at a boat and you, say you're in a canoe and you have two or three rowers,

well, everyone can sort of row at their own pace and the boat can kind of move forward. But then there's a kind of critical mass, a speed that you need to go at, where all of a sudden, if you look at a boat with 10 people in it, you need a coxswain. You need somebody who says, stroke, stroke, stroke. And the media was the coxswain. And so the goal wasn't—what's more important is for everybody to be aligned than to move at the exact perfect speed, right? One sort of oar that gets stuck in the water actually hurts the boat more than not moving at the ultimate edge of the speed. And so what has now happened is rather than everybody looking up to the pulpit of the New York Times, what we have much more of now is something where, yes, some platforms are higher than others, but you have individuals, people with millions of followers like PewDiePie who have more reach on YouTube than any brand or corporation.

So now what you have is nobody really knows where to look. There's nobody at the front, and it seems like we have this cacophony of noise. And as a result, we don't have the same kind of consensus that we had for the majority of the post-World War II era. Yeah, this is one of the most fascinating things. So we went and, um, uh, Joe who's sitting here in the room and I went and looked at, uh, we compared, uh, many of the most popular television shows to the Joe Rogan, uh, just the YouTube channel, right? So not audio, Joe Rogan gets on average a million or more views per YouTube video, right?

Um, in, in terms of if you kind of eyeball, we didn't do, you know, exact math, but, but If you kind of look, there are very few, if any, TV shows in America that consistently do a million views, right? And so you look at it and you say, is that also similar to PewDiePie who has millions of subscribers, millions of views, et cetera? Is that because people are choosing to subscribe because they believe and trust those individuals over the mainstream media? is it because actually people don't want to pay for the you know cable or whatever it is uh and so these are on different platforms so it's a platform advantage or is it actually that those individuals are willing to talk about things going to your idea of consensus they're willing to talk about ideas that the mainstream media is not willing to talk about right you see this with

kind of the uh the meme around that epstein didn't kill himself and you know all this kind of stuff right that's not a conversation in the mainstream media for the most part um is it one of those three or is it kind of not one thing and you get a blending of there's a whole bunch of factors and trends coming together and that's why we're seeing the the kind of degradation of the you know media institution or the the content that comes out of those uh institutions yeah so the what what you're seeing is there's been a big convergence of tactics that a lot of the mainstream media there there's just a ruthless competition for eyeballs and it's i understand why journalists who have to get eyeballs have done this but they have what they've done is they've adopted a lot of the

blogger tactics the original blogger sphere sort of to exaggerate this is something like gawker There were sensationalized stories, and they were, according to the U.S. government rule on the Teal case, they were invading people's privacy. And what you had was a lot of what that was was now that anyone could share, there was a competition for trying to come up with the most sensational stories. But this has been happening for hundreds of years, going back to yellow journalism in the late 19th century. But we have seen time and again that many of the most sensational stories went out, and it was the bloggers who were first to take advantage. And what you've seen is this kind of convergence. And unfortunately, it has polluted a lot of the comments. But I think that there's some other things going on here where if you look and you actually talk to journalists, many are scared because they're seeing their friends being laid off.

So I was a journalism major in college. So my full intent was to actually go become a journalist. I wanted to go become a television anchor. And I would talk to my friends who would do it. they were getting paid like $28,000 to move to these small markets. And you know what's weird about journalists? Often, at least the ones I knew, they're mostly not paid very well, but they are so smart. Like in college, the journalism majors who I knew were some of the smartest people in my entire class. And they grew very frustrated by the difference between what

they were getting paid and how talented they were and i don't blame them a lot of them are resentful but i worry that that resentment has now filtered into many of the mainstream publications and i think we're feeling it in our public discourse yeah so i absolutely agree that and i even take a step further like part of the failure of the mainstream media has been that journalists who were trained on ethics process right language all the things that a traditional journalist goes through they all started masquerading as bloggers right which meant that if you look at what the content they create on twitter if you look at the language they use if you look at the lack of kind of rigid process right even some ethical components we've seen right whether it's gawker

or others um that they get compromised and part of it is because the incentives drove them there Exactly. Right. And I'm talking about more of the financial incentives. So we need to drive clicks. How do we drive clicks? Well, maybe we don't hold exactly to this very rigid process we had. You know, we can kind of skip some cut corners, et cetera. But also some of it's a social capital associated with it. Right. If you're somebody who has spent four years in college studying journalism, you went to that small market, then you went to a little bit bigger market, a little bit big. And then all of a sudden you spent 25 years as a journalist and nobody knows who you are. No one reads your stuff compared to the guy who sets up WordPress and just starts firing off, you know, hot takes. And next thing you know, he's got a million people reading everything he writes, right? Or the woman who jumps on, you know, Twitter or Instagram and just starts creating content. And next thing you know, like everyone trusts that person. I think that some of that is social capital envy almost, right?

Of like, I have that talent, right? I have this training. I've put the work in, but I don't have the same result. And therefore, are they actually questioning the process that they've been following and saying, the world's different now, right? I was trained on one way, but now I need to go do this other thing. That's a really good point, and I've never framed it like this, but you just gave me an insight. So when I was in college, we were trained on the ethics of journalism, and we were – I was tested on media law. I was tested on following the AP style guide, stuff like that.

and now if you look at what it takes i'm laughing because i'm thinking is there a twitter ap style there definitely isn't so now what it takes to become a successful journalist is much more business savvy of the ability to understand how to sell a subscription the ability to understand how to actually build an audience and now like traditionally there was a big wall in journalism there were sales people in the organization and then there were journalists on the other side and there was very little cross-pollination between them and they didn't really like each other and right so now what we've had is journalists so bill bishop he writes a newsletter about china i did some back of the envelope math cynicism cynicism which is hosted on substack which i am

a very very very big fan of so i did the back of the envelope math and he makes somewhere between a million and 1.2 million dollars per year based on his subscriptions that is a damn good living and that is because he's been able to cross the chasm between those two things well and just sorry to interrupt but he was um for those that are not believe he was a traditional reporter at axios and started writing on the side around china and it grew and it grew and it grew when substack got created which for those that don't know substack is basically a platform that lets you have an email newsletter and you could sell subscriptions against it, right? So people will pay you for it. It got to the point where he said, there's no reason for me to be a traditional

journalist. I should just go do this full time because he's making quite a good living. And he jumped. And so he literally quit the traditional world to go kind of be his own boss. Yeah. You know, this is a sort of an idea that I haven't really thought through, so let's do it. So I think that there was a kind of redistribution in the old method of journalism where it was very hard for top-tier journalists to actually quantify how popular they were. So I guess you could do it with who's speaking at Davos, how many people write letters to the newspaper, but it's very hard to know, for example, that I like David Brooks at the New York Times and I subscribe for that person. So what I think happened is that the really good journalists were paid less than

they were worth. And they actually almost subsidized the rest of the journalism required to actually fill the newspaper. And so you had all these other journalists who say were making $50,000 a year, roughly what they were worth. But then you had the people at the very top who are bringing in millions of dollars worth of subscriptions who are maybe only paid $200,000. And I think that they were serially underpaid. And so now what you're seeing is those people, and it's the Bill Bishops and the Ben Thompsons who write at Stratechery that are sort of proving out this theory. And I think it's true that now what we're seeing is those top tier journalists are getting paid what they're worth. And it's funny because we're living in a world right now

where journalism is seen as not a good way to make money, I predict that by the end of the decade, there'll be hundreds of journalists making millions of dollars per year, and we're gonna see the journalism return to a, I hope so, because the world needs it. I hope that then these top people are paid what they're worth.

Yeah, and part of this was, I think that subsidy, not only was happening internally, but externally, one of the metrics that people would use to kind of measure who's more popular, how many Twitter followers do you have? Right. And that actually has nothing to do with, you know, writing long form content and Twitter followers. Well, you may be a better writer,

but I'm better than you at Twitter. So I have more followers, right? It does not really kind of a one-to-one comparison. Um, it's the world's weird, right? We, you know, when you start getting into financial incentives and social capital incentives, uh, I think it can get kind of out of hand. And, and frankly, that's what we're seeing now with, uh, with Twitter also, right. is how many of those traditional journalists are firing off the hot takes, right? And now we're actually seeing, you know, one of the recent stories is there was a CEO in New York, Away is the name of the company, where they make luggage.

And basically, there was an article written in a traditional outlet. There's a bunch of outrage on Twitter, which just Twitter, you know, has that outrage culture and can kind of fuel that. The CEO decided to step down. And then a couple of weeks later, the CEO said, wait we kind of overreacted to the twitter mob and now i'm gonna step back in they'd already hired another ceo so now we're gonna be co-ceos all of that i don't know what's true what's not true what's right what's wrong etc but the fact that the twitter mob became blank you know they

were blamed for overreaction i think there's a lot of people who are sitting there saying wait a minute are there now going to be situations where when that that twitter mob comes calling for somebody or the cancel culture etc people just say look we're gonna wait right we're gonna we're gonna kind of let the dust settle and see what the facts are which is what journalism used to be right you didn't actually have to just who's the first one to fire off a tweet it was let me go talk to sources let me get information let me confirm facts and then tomorrow's newspaper i can kind of lay it out in a very kind of well thought out way twitter kind of ruins some of that but it feels like there's this undertone of people saying you know maybe maybe being patient is actually a

good thing in some of these scenarios yeah i mean look at the new yorker the new yorker used to the editor used to just give people hey here's six months here's here's a year go explore what you want dive super deep into it and then come back to me and sometimes those absolutely say those above average stories weren't run because there were great stories that got ahead of them and now we don't have that now there's too much of the media is trying to just produce more more more and more and more. Hey, there's zero marginal cost of a new article. There's infinite shelf space. We don't have to deal with this. The New York Times famous slogan was all the news that's fit to print. It implies scarcity, implies constraint. Now, hey, new article, free to do.

Let's just get more traffic. I had a conversation with a reporter at one of the big three media companies in New York. And they told me, I cannot believe they said this. Sometimes it is my job to write faster than i can think i i have to write some days between five and seven articles a day i'm exhausted and it frustrates me that page views is the biggest thing i'm evaluated on if that sentence that idea doesn't capture the essence of what media is right now i don't know what does. It makes sense because that's what the incentives are, right? Like, okay, you need page views because you need to sell ads. What's the downside of kind of the subscription economy and the I pay directly you for content, right? But I don't get it if I don't pay.

Yeah. So it's that information that's free liberates so many people. Information is something that you use to learn about the world. It gives you access to things that you wouldn't have access to. Look at me. I was a college kid in North Carolina. The reason that I was given access to ideas and information is because of Twitter's ad-supported model, because of Facebook's ad-supported model. So we love to hate on advertising. Advertising is the death of democracy. And look, I've read Attention Merchants by Tim Wu. I agree, there's a lot of bad things with advertising. But at the same time, if advertising doesn't democratize information, I don't know what does. I've spoken to countless people in other parts of the world who have been

able to start their learning journey because information is free. And advertising is important because it gives information to people who don't have the means to pay for it. For sure. You said earlier that you think by the end of the decade, there'll be a bunch of reporters who are making millions of dollars a year. I don't think that you are wrong,

but I know that another thing that you believe is that we will start to see teenage billionaires. Explain kind of how you get to that and how you see that playing out. Because that's probably, to me, one of the more controversial thoughts that you have. But controversial for those who haven't critically thought about this stuff. I'm in the camp of I think you're much more right than wrong that that's going to start happening. Yeah, there's—

Like, I would put money on the fact that it happens. I would put money that there will be a billionaire teenager by 2030. How old is Kylie Jenner? Do we know? I don't know. but if somebody wants to joe what do we got man go for it but if someone wants to say that doesn't count that's fine so okay so kylie doesn't structure the parameters of this saying you need to start with some net worth below whatever right so like you can't you can't be rich and

famous basically uh during your childhood because of family inheritance whatever 21 21 so she wasn't a teenager so basically what's happening right now is it is getting easier and easier to start a big company with just your computer and you have kids who have access to computers and they're able to do some create tremendous wealth for themselves And what I've seen, so I've seen a couple little points here. So WhatsApp, when it sold to Facebook for, I think, $19 billion, had only 55 engineers. Something like that. I just had, so one of my very good friends named Andy McCoon, he just sold a company to Squarespace at 24 that he started.

I, the, the, the actual acquisition price isn't out, but they had 25 million users. I think 2 million who were paying $20 a year subscription. So they were making pretty solid money and he was building, he built earth, uh, the Instagram handle, which has 1.5 million followers. He started that when he was in high school and he didn't go to college and he built millions of of wealth in 18 months. My point being, you're seeing the early signs of tremendous wealth being created by younger and younger people. Basically, you could almost build a billion dollar company from the phone in your pocket. Then there are probably some things that you would need a keyboard to do. The fact of the matter is you no longer need to go buy a big

factory. You no longer need to go manufacture airplanes, get an energy plant. Kids have tools and technology. And what you have is this weird inversion. Take the legal profession. Who are the best lawyers? Well, we say the best lawyers are the people who have done the most schooling. They went to law school, they went to Harvard, they worked, whatever. And our Supreme Court justices are quite old. And so we say the older you are, the more educated you are, the better of a lawyer you're going to be. Technology kind of inverts that paradigm in some ways, where who is the best at making TikTok videos?

It is not Auntie Sue at the Thanksgiving table, right? Or the Supreme Court justice. Right. Although, I'll throw an interesting fact out. I'm a big fan of, in our building, they have TVs in the elevator, and they always throw these weird facts out. And so people probably heard me talk before.

The first time I started paying attention was I read that dogs can get sunburned. Okay. didn't know that right didn't know that okay different kinds of dogs different levels of sunburned all it said was dogs can get sunburned did you know i was like i did not know that golden retriever what i saw today was uh justice john roberts i think is the name of supreme court justice uh in uh some either proceeding or writing uh used the phrase okay boomer in an age discrimination case and so we might be careful that the uh the supreme court justices aren't

on TikTok soon. Okay. But continue with your point. Well, my point is that young people, technology inverts the law paradigm, meaning that for certain skills, actually being young is an advantage. And if there isn't a teenage billionaire by the end of the decade, there will absolutely be a teenager who's worth hundreds of millions of dollars. So how about Vitalik? So So Vitalik, what was he worth at peak Ethereum? Oh, I don't know. A lot. At least hundreds of millions for sure.

So that's not that far. I mean, he started that when he was a teenager, right? I think he might have, again, been young 20s. Young 20s? Joe will tell us here in a second. So yeah, he's worth low hundreds of millions, low nine figures. When did he start Ethereum? 2014.

So just maybe look at what his age is now. my point is no matter how old he is we're now just much younger like a standard deviation this isn't like some radical paradigm shift yeah so yeah so he was either late teenage at 18 19 or or into his 20 uh years now you talk about this inversion another inversion that i think is uh playing into this and actually gives me more confidence uh historically what companies have done in entrepreneurs is they build a product uh they build the company and then they go build distribution right so what's our product okay who do we want to sell it to and it's very sequential in that now what we're seeing kylie is a great example right and others is no no i'm gonna go

build the distribution and then i'm gonna build the product right uh if you think about it if you had to choose you would absolutely want to build the distribution before the product right because it is much higher percentage chance of success if you get the distribution the product is kind of not actually an afterthought but but there's a high probability you can get a big audience to buy something the reverse is not true a lot of people build products they never get sales because they can't get distribution down and so the phone right or the technologies that these young kids are using they're actually building the distribution whether they realize they're doing it or not because they're building audiences those audiences give them influence and so there's this massive

shift underway of like how some of these companies get built that I think plays very nicely into this trend of like there's going to be teenage billionaires totally I mean this has been the subtle thread through what I've done is I didn't know what company I wanted to start and if you don't know what company you want to start the best thing to do is start writing online so I'm obsessed with this idea where so I'm going to go a little bit macro where the American dream is not what it used to be. If you go, Raj Chetty, he's an economist at Harvard. If you go on his website, Opportunity Insights, he's going to win a Nobel Prize. Another prediction. What you see is a downward sloping curve from the northwest to the southeast. And the curve is the percentage of

kids who made more money than their parents. And it's going northwest to the southeast. Yes. So it's going from the top left of the curve to the bottom right of the graph. And what you see is it's getting harder and harder for kids, millennials, people like me, to follow the traditional path and have it be successful for them. We're seeing what I call credential inflation, where you have all these people who are 30 years old. They have, say, three credentials. They have a bachelor's, a master's, and a PhD, and they can't find a job. And they're $100,000 in debt. I mean, it's tragic. And so what I think is also we're seeing a collapse in the startup formation rates for America. There's all this attention on Silicon Valley, Google, Facebook, Amazon, Netflix, Google. We're in the golden age of entrepreneurship. Well, actually the data shows the startup rates in entrepreneurship are also going way down. The number of companies being started or the success of them?

The number of companies started are going way down. And so across many different axes, American dynamism is falling. And the American dream, I think, is to be able to have financial freedom and to rise up so you can buy a house and live a good life. And so what I increasingly think is that the new American dream is that it is getting easier and easier to start companies because you can now build these audiences. You couldn't really do that 20 years ago, and you can use plug-and-play software like Teachable. So for Rite of Passage, we use Teachable, we use Zoom, and I use ConvertKit to send my emails.

These are amazing pieces of software. I don't pay very much for them, and I can do plug-and-play. I don't know how to code, and I have a software-enabled business. How crazy is that? So it's getting easier and easier to start these companies. I, early in my career, was terrified, terrified of automation, which is actually what led me to that personal monopoly idea. I knew that if I had a skill that could be retrained, whoop, bye, that's a Southeast

Asia skill. It's going to be run by somebody in India, Vietnam, or Indonesia, or it's going to be automated by robots. So I tried to build a skill that couldn't be. But the flip side of global competition for jobs is also global opportunity for customers. So what you can do is you can build this kind of global audience. Then for your product, you now sell to that global audience. And what I think is basically what I want to do eventually with Rite of Passage is I

want people, I have built an audience. That's done. Rite of Passage is fantastic. Now I want to help people build a product. How do we do that scalably? And then how do we actually scale up those businesses? And I just want to take tens, hundreds of people every year, get them to $200,000 in money that they make. Once you hit $200,000, you can support a family and it's your business. You have full

freedom. You don't have a lot of employees with these software companies. And I'm just obsessed with how do I give that to thousands of people? So you hit on one of the ideas that, uh, I used to not tell people this because I felt like it was, uh, kind of the Peter Thiel, like it was a secret i knew that others either didn't agree with um automation while it crushes the repetitive kind of somewhat intellectually non-stimulating jobs it actually makes one skill very very valuable that's creativity yes right and so the more that the machines can do the monotonous work actually there's going to be this uh premium placed on creativity and so if you think about creativity exists today and there's going to get a premium is it that the like the the price or the

value of creativity increases or is it actually that today we under price the creativity and it's merely going to expose the true value of the creativity right like you can either say it's undervalued or hey it's correctly valued today but over time it will increase either way it becomes more valuable than we look at it today which i think is a really important thing for people to understand as they think about that skill development. Right, exactly. So the way that I would phrase it is that you have more leverage on your creativity. So if I write a Howard Marks, when he started at Oak Tree, he would write a memo, a letter. Well, he actually sent that letter to people. He would put it in the mail and he would put stamps on it and it would go out to

all of his investors. I've read every single one of them. I think he started in 1972 and they are fantastic. They are phenomenal. Timeless information. And how do you read them now? On the computer. You go on the computer, right? So he presses publish and now voila, he doesn't have to do that work. So you have more leverage on your creativity because when he presses publish and you go on, that website might be hosted on Amazon Web Services, which has robots running automatically to keep that AWS machine and that website going. So he has automation working for him already. And creatives are now able to capture value from their work in ways that they didn't used to be. I've become decent friends with a French artist named Allura, big fan of her work.

She does these kind of hyper-realistic photographs, which then she touches up of Japan. And her background is in video game design. She's like 24 years old. And I started buying her buying her art. I just thought it was amazing. And she grew up in rural France, was living in Japan at the time. And now she makes enough money that that's what she does because she goes and she goes on Society6 and she sells her paintings. So my point here is that Howard Marks, he just has more leverage when he presses publish that can reach anyone with an internet connection, 24 hours a day, seven days a week. And then my friend Elora, she's now able to sell her art. She doesn't need to move to New York and go to Sotheby's and start selling her art and whatever or go to Chelsea to the art galleries.

She doesn't need to go through these institutional gatekeepers anymore. She can go on the internet, build her Twitter following. She's crushing it, and I love it. Yeah. It's really crazy how the distribution channels have drastically changed. And I think a lot about globalization, right? So part of even 10 years ago, right? So 2010, the connectivity wasn't there, right?

So if you think of most companies, technology companies, they got built, you know, starting in the United States, they had to penetrate the U.S. market, and then it was a big boardroom decision. Let's do international expansion in 2012. Well, you can only expand as far as the internet was, right? There was a lot of countries, a lot of populations that they just didn't have internet access.

They didn't have devices, right? Now, for the most part, you see a lot more internet coverage, right? I don't know the latest numbers, but there's billions of people who are connected to the internet, who have devices, et cetera. And so when you start a company, right, things like Stripe, things like Shopify, things like Teachable, you know, all that stuff, you can have a global business on day one, right? And I think that that is so, so powerful, but it goes back to another trend that we see in

technology, which is, I don't think that the whole, like, I want to build a venture-backed software company that's either a billion dollar company or zero is going to be as sexy as i want to build a business that can provide me a living and i actually want less employees i want profitability uh and i want kind of control um and those two things are very different paths to pursue you know kind of different strokes for different folks but i do see a resurgence in that idea of I want to build a kind of personal business, very similar to what we saw before the internet existed with small businesses, right? People wanted to build businesses that serve their community. Well, now that community isn't geographically based. It's kind of interest-based

to some degree. Absolutely. We had in our third cohort of Rite of Passage, six months after it started, 196 students from 28 countries. Really? 28 different countries of students. We had a guy named dozy who would stay up in nigeria 3 a.m he would show up to the live sessions one of my best students anna fabrega she was in panama she would show up we had a guy named victor in the ukraine and we would all come together to talk about writing and that's pretty cool it's it's it's it's just amazing to watch us all come together and how global this thing already is and to your point about about the globalization is one of the big constraints now isn't internet access for me it's time zones where i can't have more students because a lot of students want to be

there for the live sessions but still my second biggest market is india i have so many indian students and i love them because they're consistently the hardest working people in my course. And the big thing for us is what do we do with time zones? And time zones are actually going to be one of the constraints on this new global economy. Yeah. What are some other trends that you're super excited about, kind of at the intersection of media and technology, influence and kind of business building, writing, et cetera? Yeah, I think that I'm going to just phrase this a little bit differently. One of the things that I've been thinking a lot about. This is a bit tangential, but just cities.

There's been a lot of the economic, so I'll talk about the economic consensus where I agree with it and where sort of their big blind spot. So I have this idea called the merry-go-round, that cities are a literal merry-go-round. What is a merry-go-round? It spins, it spins, it's kind of a party. There's all these horses and weird people and there's sort of themes, there's music, it's sort of a party. And then you're off the merry-go-round. You're like, whoa, I want to be on that thing, right? And I actually think cities are very similar, where what's happening is the economic returns to being in cities are increasing. I think that 50%, this was an Axios idea, 50% of American growth last year came from something

like the top five or 25 American cities. So basically, the main point here is that the quote that the reporter uses is, success in America increasingly hinges on one variable, where you live. And so I think that I spent, I wanted to really spend some time in America. So I spent 18 days in Michigan last summer. And I saw a lot of factory towns that had been hollowed out. And I went to Michigan because I saw a stat that like in 1950, five of the 10 wealthiest cities in america were in the state of michigan now none of the top 10 are and that's from like car manufacturing exactly in uh in early world war ii um this that is a little bit disputed so take it with a grain of salt but the detroit economy had a bigger economy than every single

country in the world except for something like france russia and britain like everything except for three or four countries. Detroit was a hotbed of economic opportunity. And we're still seeing the same thing where you move to New York and San Francisco, there's so much opportunity here. There's this dynamism, but we're not building new housing. The transportation is awful. Our infrastructure is crumbling. We build the second Avenue subway, the new queue line, it costs $2 billion a mile. I mean, come on, you can't get to, I was looking, it was cheaper to get to JFK by helicopter than by Uber because the traffic is so bad. So we have, what's happening here is we're not allowing more people to move to cities. So you're seeing this increase in pricing. And to

go back to the merry-go-round metaphor, it's spinning faster and faster. So it's becoming this sort of club for people who have access and opportunity, but it's getting harder and harder to get on. And so what though the economists are missing is cities, while they're good for economic opportunity are not good for community. I have felt at times, especially my first two years in New York, tremendous bouts of loneliness. It was really hard for me to meet people. I still, in order to go hang out with friends tonight, have to take 40-minute subway. And it's bizarre how you can walk down Fifth Avenue at 630 at night, and you have thousands of people that you're looking at. And yet, somehow, you feel like you are in your own echo chamber, like a

London phone booth that you're just trapped in, and that you can't actually talk to any of those people. And my worry is that cities are places without community, and that economists, by telling people to move to cities, we devalue rural life. We devalue the social institutions that have kept them so strong as communities for so many years and the ultimate question that i have is how can we create cities that are big enough to give people economic opportunity but small enough to give people love and people in their lives that touch their heart one of the stats i saw recently uh there's been two articles in the new york times um that uh that have been written about housing in uh in new york city and specifically touching on luxury condos so from 2010 to 2020

or 2019 really uh there's this big boom in construction right and between 2010 and 2015 there was massive uh sell through meaning that they built apartments or luxury condos they sold out of inventory what does that mean build more build more build more and there was this kind of really big push now obviously you don't snap your fingers and build a building so there's some kind of lag between we need more housing let's build the housing where are we going to build it what's the design construction okay now you can buy it what percentage of luxury condos that have come onto the market in manhattan since 2015 do you think have been sold 34 okay 50 50 50 percent have been unsold part of that is foreign dollars aren't flowing right kind of as

um uh um well as they used to flow uh two is the cost right and three is a lot of the sentiment that you're talking about where other areas right outside of the island of manhattan have become more popular brooklyn etc so it kind of pulls people away the other article i read is uh they were trying to estimate uh and there wasn't really kind of a clear answer how many apartments that are above i forget the cut off of the floor are empty in new york city and it's again material double digit percentages are not even unsold so meaning that hey you can come buy it but unrented as well and so the whole idea was you've built all of this stuff by projecting demand but the demand's not there and so if you understand economics it's either what you built

isn't good so supply issue right or there's too much supply or the pricing is wrong right there's a mismatch of the supply and demand that stuff moves in cycles but one of the buildings that they talked about and i won't say what it is because frankly i don't know enough about it but uh this one building um it was like 40 has been sold right this luxury building built two years ago and so i uh was reading through the article and it said they've now started to do rent to own so they want to sell nobody wants to buy so they'll do rent to own you basically go in and rent for a year they contribute that towards the purchase price and you can buy it uh and so i said that's interesting i've never heard of a luxury building doing rent to own in new york so i went

to the website, the available units started at $4 million and went up to 7 million. And I was sitting there and saying, no wonder you're not selling any, who is going to buy a, you know, 1200 square foot unit for $7 million. I don't care what the view is. I don't care what floor you're on, you know, all this kind of stuff. And what ends up happening is kind of that feeling of the London phone booth, right? How many people are actually seeking the community and other aspects of where they live than just, I got a really nice place with a nice view and I'm willing to pay, you know, $7 million for it. Right. I mean, that's asinine for 99.9% of people in the world to think about, but that is a problem in one of the most prosperous cities in the world.

Yeah. Yeah. I have two comments on that. So the first one is how many people live in cities and they look at suburbs and they say, I don't like the suburbs because you don't know your neighbors you basically live in your own enclosed environment and you just live in this place that feels modern and kind of without character the funny thing is a lot of these tall new buildings have the exact same character absolutely people get in the elevator they don't even don't know their doorman the places have no character i i just find it funny that now we're actually importing suburbs into the sky of cities but and this is going to be a little bit complicated but I think it's worth it because it's so interesting.

But I think that we have these very – so I was looking at the San Francisco housing market, and what you're seeing is you're seeing more poor people and more wealthy people, and the middle of the market is being driven out. So basically the middle class in San Francisco is going away. And part of it is that for a lot of high-rise buildings, what ends up happening is they get subsidies to build low-income housing. And it is so expensive. The construction costs are so high and the regulatory environment is so what Patrick Carlson calls the promiscuous distribution of veto power, which I think is an amazing term. But what you have is it is so hard to build now that unless something is at the high end

of the market, you can't actually return the money and the investment that you spend. So then what you have is at the high end of the market, you have all of this unused supply, whereas at the middle end of the market if you actually look for an apartment in New York it is so competitive like you find an apartment boom got to get on that and I was talking to my real estate agent about this and he said that something kind of flips at around 4,000 per month where basically there's a lot of liquidity especially like under 3,500 per month and then you get up and all of a sudden the entire market changes and you get into some of the dynamics that you were talking about it's crazy right and and the part to me that um and this gets into some of the

crypto stuff right uh five years ago i didn't understand a lot of the macro uh economy the systems etc and as you kind of learn about it what you find is it's all structural right and the two components are there's a lack of financial literacy people don't understand how uh money works and what to do with their money um and the second is uh the way that the dollar is set up Right. And kind of the inflationary nature of it. And what is inflation? Inflation is I'm going to debase your currency. So it's literally going to get less and less valuable every day. But if you think about it, 50 percent of Americans live paycheck to paycheck. They have no investments. Right. They store 100 percent of their wealth in cash and they believe, quote unquote, saving is the way that you build wealth. The problem with that is that saving is simply you're putting your wealth into a currency that is being devalued away.

So rather than have any sort of rate of return, what you're seeing is actually a negative rate of return, right? And I think that that lack of financial literacy combined with kind of the structural component, right? There's positives to inflation as well. They want to incentivize economic activity, right, and consumption and all that stuff. but if people don't understand it what ends up happening is they've been told their whole lives save instead there's a combination of you should save us some right some some level but you should also invest right and i think that um there's a gentleman uh marad mahab if i don't know if you've come across him uh but marad was the first one to uh to talk uh about this with me which is

we ask anyone of any profession a teacher a firefighter you know whatever to be good at their job and to also be a professional investor that's how you protect your wealth in america right is you've got to understand what you do for a living how you make income but then you also have to understand how to invest and investing can be you're actively managing something you're investing in passive vehicles or maybe you go and hire a professional right but if you don't do that you can't protect your wealth or you can't grow your wealth and so it becomes this really interesting kind of structural um psychological sociological um geopolitical issue that that's where the middle class goes right they get pushed one way or the other and to me i always just chalk it up to it's

the people who understand the rules of the game the people who know the rules they actually usually tend to thrive because they understand how to play but the people who don't understand the rules they have this sense of i can never get ahead i'm always behind i can't get ahead i can't get ahead and i think that's really where you see that feeding into how housing is built how societies and cities and all this stuff comes together the hope is that crypto can in some form or fashion right depending on who you talk to can change that or influence that to uh kind of improve the world right all right he's got to go in five minutes so i got one question for you uh you are friends with many people who are very uh educated and enthusiastic in the uh bitcoin and crypto world

give us an overview of what you know in terms of and then what your view is as a quote-unquote outsider so someone who doesn't spend all day on this well let me just talk by my actions i am super bullish on bitcoin i fundamentally believe that bitcoin is going to be a very transformative part of the next 30 years why because of what you're talking about with inflation. I think a lot of people don't want to trust any government with their currency. And a lot of people in other countries outside of America think that, like, for example, people in China, what I hear about the Chinese economy is that that currency is sort of on quicksand. And I think a lot of people feel that way. A lot of, for example, apartments here that we

are talking about, people are trying to get their money out of China, out of parts of Europe, parts of Russia, and they're trying to get their money into big apartments here. And that's why some of the prices of New York real estate has been inflated. And then at the same time, I know I've had two people come to top of my mind this week who said America's doomed. And so you've had the American currency, which has basically run the world since the Bretton Woods conference after World War II, and people no longer have that same trust, right? It's just like what you're talking about. I think a lot of wealthy people, they're not happy about taxes in America, and you have different movements like seasteading and stuff like that, or people trying to move to

other parts of the world where their taxes aren't as high. And then you have people who maybe aren't making as much money who feel screwed by the system. You have Cantillion effects, right? You have inflation pumping to the economy and it's going to people at the top before it's going to people at the bottom. That's a rigged system for people who know the rules. And so to get back to me, I believe all those things and yet I don't own Bitcoin. Why? Because I don't want to go on Coinbase and pay the fees. I want to do it right with one of the crypto wallets where I sprinkle nail polish on it and all that thing. And I just don't. I mean, part of it too is I fundamentally am so bullish and believe so much in rite of passage that I think that the rate of return

that I can get on investing in my business is higher. But also any real rational calculus here would say, dude, put one or 2% of your money in Bitcoin. And I just haven't done it even though I am surrounded by crypto. Because you think it's hard to do? Yeah, it's hard to do. It's confusing. What if I lose the key? I don't know.

I mean, it's just like, it's kind of scary buying Bitcoin. It's like, am I doing this right? It still kind of feels like this new future thing that might not be legit, even though I believe in it. It's funny. It's like, it's always weird when you have these weird cognitive dissonances where I have like theoretically i really believe in bitcoin but obviously i have some kind of aversion to it oh this is big too i my family would think that's so crazy and and so it would turn into such a what

are you doing with your money conversation and as a result i just haven't bought bitcoin i intend to change that and it kind of bothers me but that's why i love that view though you're super irrational about why you don't own it. Like you, you believe, but you just are like, Hey, it's hard. I, I just know crypto is the future. Like I just believe in it. So, or at least Bitcoin, like I really believe in Bitcoin and between me and Arjun, we're going to get you, we're going to get you hooked up. All right. What, what is the, uh, what's the most important book you've ever read? Understanding media by Marshall McLuhan. Why? Uh, so Marshall McLuhan was a member. I was talking about the space and time bias. So Marshall McLuhan was a media theorist

who wrote in the 1960s and don't actually read the book listen to his interviews he actually did an interview on with playboy magazine which is the very best marsh mccluhan interview and then youtube terence mckenna 53 minute breakdown of marsh mccluhan's ideas they absolutely transformed how i saw about the how i looked at the world because what the book is called is his most famous book is called Understanding Media. But he didn't define media as the media that we were talking about. He defined media as technology, things that actually mediate our senses. So for example, the wheel as an extension of the foot, a hammer as an extension of the hand. And he went all the way back in time, going back to the invention of language and stuff, and looked at

what are the systematic things that happen when a new technology comes into society. And what happens is you get this big speed up a big acceleration and then you get a flip an inversion which is why i use that word all the time where we go back and we retrieve the old and what marshall mccluhan has shown me is that what's happening right now isn't entirely new and has given me a framework for understanding shifts in technology that then i've been able to apply so that i can have a modicum of calmness in a vortex of fear and anger we're ending right there you're a fucking legend man all right listen thank you so much for coming to do this where can people find you and uh right of passage um i'm on twitter at david underscore perel perel.com p-e-r-e-l-l

dot com is my website and right of passage is spelled w-r-i-t-e of passage so w-r-t-e like right of passage thank you very much awesome man thank you so much for coming hey everyone pop here if you like this episode of off the chain and want to help us take crypto to the top of the apple spotify and other podcast charts please do us a favor and rate review and subscribe to review simply go to the off the chain home page scroll down until you see the five blank stars taking 15 seconds to fill those stars in and leave a quick review goes a long way in helping us take the entire crypto ecosystem to the top of the charts i appreciate you listening and see you next time on off the chain