#128 - Open Startups, A Mysterious Bag Lady, and Gamifying Facebook Ads

u yeah i feel like i could rule where i know i could be what i want to put at all in it like a days off on a goal travel never look kim back i'm recording what's up sam what's going on you bought a house yeah hi did you really i thought you were bluff and when you sent that to me no i've got the inspection right after this so i went out to like i'm in austin because in my company's base here some of the guys took me out to like a dinner or something and i was walking around the neighborhood i was like this is amazing i wanna move here and so that was on thursday on saturday i looked at a house on sunday i made the offer monday was accepted so we're good i i'm gonna rent it out for some of the year and living in at some of the year wow okay i love it is it like kind of residential neighborhood family or is it like cool mere six street like where where are where are you doing it's the cool they call it like the grimy area it's or i don't know what the stereotype is it i frankly know very little about it it's in it's in east austin it's office sixth street it's like a twenty two twenty three hundred square foot it's really nice it's very nice and we got approved i we i got a little bit of a little bit more a little bit of a mortgage right and we just got approved fast and bought the damn thing and sarah's cool with it yeah definitely we i think you're my hero because you live like you live you make decisions like an independent person while being happily married it seems that way it's it's definitely not i mean i do a lot of the talking but it you know i it's a team and so we both agreed but yeah go hey you wanna do this it will go yeah we're in and so we wait we make decisions quick or i make decisions quickly and i think i think that's it you found somebody who is compatible with you in that way making decisions quickly and valuing similar things so that your decisions are are are right aligned like when we bought a car we was like on a thursday it's like let's slip by car what type well don't no let's just go look at and we just bought it on a friday so that's how we roll that's how i did with my dog i woke up at the morning christmas eve i said let's go dog shopping and she's like no and like we had agreed now now's is not the time for the dog and then it just that morning it was like today's the day for the dog and we went we saw three different dogs and we bought the third dog and came home that's the way to go and i also when i was looking at the house i wore a mask the entire time but one of the agents who was showing it message me the next day was like i just tested positive and i'm so i that's why i'm home because i can't i'm not i'm not going anywhere but i went and got tested i'm negative but i'm still being better safe and sorry that's good that they called you i had a friend in college who got the herb and his doctor was like hey you need to call all your you know girlfriends and you need to tell him like what's up and he's like oh shit why like are they gonna die and he's like no but you know it's disrespectful still serious and it's respectful and you know this type of thing and can stick around and it can be passed on to babies in the future for the and he was like oh wow okay came home called nobody i told nobody so it's like shit yeah it there's a scene in the office where michael gets herpes any he calls people he goes i don't know how to say this so i'm gonna spell it out i've tested positive for h i r p and expelled herpes like michael herpes is spelled with an e dot of i i wanted to do that that's got help i thought like i had like call my coworkers and i'm like just so you know i was around someone who tested positive but i'm not positive anyway right we're good alright that's great alright let's jump into some topics so congrats on the house and let's talk about bear by the way i'll i'll so i intend to airbnb this home and i'm gonna reveal well i'll reveal the numbers once we once we do it and i think that'll be a fun little segment right i'll also let me let me tell you something really quick about this there's this got there's this company that i love it's called super money market that what what's going yeah you've talked about that once before yeah is it sorry money's supermarket it's like nerd wall but it is in britain and it's been around for longer than nerd it's been around for so i think since the beginning of the web and the guy who started his name is nixon simon simon nixon big billionaire and when he it went public and when he sold it he went and bought a vacation home and then his friends wanted to like stay there and he went and bought another one and his friends wanted to stay there so we've created this website called simon escapes and it's i think it's like a i don't know if it's like a profit making business but it's like a legit business and you could go and rent a variety of his homes and the whole stick is that this is his personal collection i don't know if that's true if it's like part of the stick but it's kind of interesting and i called ryan bi man and i was like hey this is pretty interesting he goes yeah this actually pretty common a lot of billionaires like even bill gates and richard branson you can go and rent their private estates and ryan told me he's like yeah but i'm pretty sure a lot of them are wildly unprofitable like for example the founder of circus delay i think he has a bunch of them and you can he's like they really just do it just to lower reduce their burn but it's kind of a neat idea like one day to be rich enough to like just you know own so many homes that you can rent it's it's it's cool yeah i think you could do like a a membership like class pass but for staying a billionaires houses and so you pay the membership just to be just to get access to the airbnb platform where you could rent only you know chat and villas and and ski houses of that's a rich i've just i learned about this last year what's that called it's called the is it avi or l elevated yeah there i've heard of avi that's from the show silicon valley no it's it's like a monthly like you pay a monthly fee and you get access to high end what's it called el auto or okay it's called something and what is it they it's huge i see commercials support all the time and what they do this is like totally like we didn't plan any of this so what they do is they buy vacation rentals and you pay a monthly fee and you get access to all of them right it's called i don't know what it's called i'll have to look it up but anyway it's just like this cool that i saw this guy do that i'm like that'd be fun to do that right i think somebody could also while we're just ripping off this i think somebody could also do this for parties so i think you could also create kind of like a high end party club which is basically like a membership fee pay every year and you get invited to parties in all these different cities and the parties are part of the parties all are hosted at house parties of like baller houses and and so you take kind of like an elite crew and i had a friend who was doing this in moscow he basically was like he went he's he's from moscow and he traveled around the world he got his nba at that that program called ins nc that was like i know if ever heard of like halftime time in singapore halftime time in paris or wherever it is and so he had this like kinda cool global network of like you know like successful kind of successful ish people and what he did was he created this party club at moscow that only they would get text messages too to these underground parties are were either at clubs but often that non like club bar venues so somebody's house or you know out outdoors in a field or whatever it was and it was always like really cool events and so he had this list of like text three thousand members that would just get this text every single time and he was making great money doing it and he was just doing it because he built like the most powerful kinda like social scene and he liked to be the king maker of that scene and you know meet girls and he liked to do all that stuff but i i could see somebody you know connecting some of these cool venues together in into unique ways whether it's for rentals vacation rentals or for partying it's not a great business but i think it could be a lot of fun for somebody who's just you know and you know somebody trying have a good time so i wanna rip on that for a second but first the company that i was referring to is called ins so vince sporadic dot com five hundred employees two hundred million in revenue you pay you have two packages one six hundred one's two thousand dollars a month i think the six hundred dollar one you get reduced rates that two thousand dollar one you get to stay i think that's your rate it's very expensive two grand one it's luxury luxury vacations basically luxury travel vacations yeah i think and i don't think they raised a lot of money compared to how big they are it's a subscription business anyway pretty big kind of interesting different take on the airbnb thing and then the other one in this space that i think it's gonna be massive i've been talking about this for a few months now is called hello landing which is kinda like this but more low end so you could spend two thousand to four thousand dollars a month and you just get a furnished apartment in like eighteen cities right and so you could just live out of that and it was started by the guy who started shipped which is a like insta car competitor but mostly in the south that he sold for five hundred million bucks a very successful guy i'm very eager to see how that plays out and then regarding what the idea you just had we had a listener or tweet at us and he basically made a scott's cheap flights but for airbnb and rentals did you see that no bra you you have to remind me what it was called it was called like serendipity or something like that but basically you say like i don't i don't even know if you had it set up this much but you say which city's interest you it could be like a variety of cities and it and he emails you out cool airbnb that are have been recent or hotels that have recently been right yeah so so it's so it's curated unique vacation stuff so i i think there's a lot of value in this which is basically like a combination of great deals and unique experiences and just doing the curation work so that people don't have to do all the research and be hunting and be finding all this stuff i think it's a pretty pretty simple way to build a build a list and build a business and the name of that business that he just is called the name a little silly but the links in there is called spontaneous like spawn stay ne yeah this spontaneous yeah he's gotta fix that name but that's what it's called right yeah probably not gonna work as this guy zach okay i've seen this guy yeah the the name is all full why i he did message i didn't click the link because the name was so awful no it's a cool service i signed up for and what it's funny is that but he just launched and he does so he doesn't have any testimonials and he has a part on his website that says testimonials and there's an asterisk and it's like no one has said this yet but these will likely be what they say yeah yeah it says what we hope you'll be saying soon future subscriber testimonials okay gotta give credit where credit too i like the i like your spun and then he says like sponsors and list a bunch of brands videos he goes these people haven't sponsored us but brands like this will probably sponsor us eventually dude the best thing the best ad sale we ever did for the podcast is one i don't if you remember this i this might have been before you came on but we had no sponsor for like two months or something like that and so i just did a ad read in the during the podcast i just go this product is brought to you by no one think about this this could be you right so we don't have an advertising right so email me if you on advertise and i got a ton people we have like booked three sponsors and like from a fifteen second joke basically it works it works and we did that when we started the hustle i put this person i think this is actually illegal organ against the rules put like this was sponsored by and then i put the name of a company and i didn't actually sponsor it but i knew that my competitors would email me to ask it this alright you wanna kick it off on what you have yeah yeah let's talk about bar metrics okay so we had reference bar metrics which is a software that gives you kind of like a dashboard for your business i use it for my subscription business and it tells you oh here's your monthly revenue here's your churn rate here's you this many people cancel there's many people card decline whatever it gives you this like very simple dashboard for your business which is useful and he was kind of like a boot bootstrap guy so he just posted a blog that says i sold bare metrics and he says after seven years of working on this company bear metrics has a new home and he just dove into all the details so he goes purchase price four million dollars of cash what i walk away with three point seven million dollars in cash this is a two point six five multiple of our annual recurring revenue and he said here's the buyer it's this private equity private equity firm the the company that bought it it's zenith there's x x yeah the woman who is the c cofounder or terry is one of my very good friends terry wilson they're all good people and so it's at you know no earn out payment structure is three payments there's you know at close at twelve months and at eighteen months which is interesting because no earn out but you also didn't get all the money up front earn out that's just he does have to work financed yeah it's sort of like dripped basically so so he said okay how we got here you know been working on this it's doing well in covid but i think it was just kinda like time to move on so what did you think of this when you saw it so bare metrics is a really cool company they buffer used them at first so i think we should i hate this phrase it's a cliche take a step back which is this business is that you've ever said that i i never i tried never to say i think it's a stupid cliche the this business is that this there's this whole group of people they call them open startups if you google like open startups i think there's a website that compile all of them and they're startups or companies that reveal their revenue in real time you could see their burn or not i don't think you can't see profit you don't see revenue so you could see well some do it all there's degrees right so buffer went crazy they were like here's everybody in the company's salary so they published their employee salary something information everything and others do kind of like the high level metrics like here's what our revenue is month by month here's what our growth was here's what our here's how our email this group but they don't show like employee salaries or profits yeah and there's a lot of sites at do this so there's start a story that guy he does that with people there's indie hackers and then there's people who do it on their own gum red guy yeah the gum road guy or open start list there you go open start list dot com has a list of them so i think that as a business owner i would never ever do that but i think it's cool i think it's really cool i love consuming it so i think that's interesting and bare metrics is like a really cool tool to get that done yeah i think that's a good move that this guy sold he only sold i imagine because he had eight hundred fifty thousand dollars in funding from major vcs and it was like an easy out for him so in the post he says that the vcs they're like just forget they they so they they had put in eight hundred thousand back in twenty fourteen twenty fifteen from two kinda like big vcs general catalyst and be and and basically it wasn't gonna be like the home run right vcs are trying to get you know ten x hundred x on their money and so they want they they want you to go basically when a avi vc invest you they're planning for you to try to become a billion dollar company that's what a win looks like for them and then there's sort like smaller wins if you end up a two fifty million dollars or five hundred million but a five four in this case a four million dollar outcome is is you know it's a rounding error it's a cost of doing this i don't he said this in the blog post or if someone said in the comments which is like the amount of time just for the lawyers on the vcs to do the paperwork would be be would cost eight hundred thousand dollars or something like that yeah i don't think that's quite true but that but but i that i get the point so he basically what he said was they i want he said i wanted to give them their money back but ultimately for a four million dollar purchase price we would need to ask them to walk on their investment now this didn't fully add up because yeah you could have easily given back to eight hundred thousand and walked away with know whatever two point eight or two point nine million instead of whatever he walked away with and three point something million but i guess he asked them like hey will you take less then i'll do this deal and or will you will you write it off so i can have an exit here you and and they said yes which is kind of amazing them and there was a lot of people on twitter who were like wait what the hell like this does not compute especially people who come from other industries like real estate or whatever they're like you just why would they write off their entire investment i don't understand and so what do you think about that reaction and and how would you explain it well i do think it's hard to fathom them because it's almost one million dollars it's a lot of money i think that you have to look at it like who it who who was it general catalyst general catalyst yeah what's their au do you know they i i think they have like a i they have multiple funds but i think that they have like billion dollar sized funds yeah so maybe like ten billion dollars they have i think that the way that they probably saw it was let's just not cause of us be cool with this guy because he's public and he'll talk well about us and that's worth eight hundred thousand dollars so they just announced two point three billion in new capital commitments across three funds so i think that's probably let let's call that there au i don't know if that's exactly it but yeah so i think our a billion dollar plus fund i think that the way you look at it is like if you're in real estate which i'm i'm gonna fluff i mean i'm gonna kinda bum through this i don't know how it works but like let's say it's like you paid a little money to like inspect a inspect a property it turns out like it's not a good property that's okay it's part doing business let's move on to the next one right that's kinda like what it is it's just when you have you know ten billion in assets eight hundred k the cost to do the inspection right so here here's what i think happened so i think a i think getting eight hundred k back is probably not that interesting to them and if they took any more i think they would kill the motivation to do the deal but by the founder so so i think yeah know that would be the most that they could get they this is probably because as seven years old this fund is probably already done well and has profits and they can actually just write off the eight hundred k and just reduce their taxes basically so they can they are gonna effectively still keep that amount of money by calling this a loss by calling this a zero and and then they get the you know the founder might let them into the next if they started another company it might be great signaling or kinda of p r because look we're talking about it and so so i think that the those are probably some of the reasons why between like the cost and the hassle versus the upside the fact that they probably have a bunch of profit that they could just write this off into and lastly you know they're sort of branding and founder friendly story that they get to tell for every founder after this yeah so that's why it's hard to fathom but when you you're like you're like look this is like point zero zero one percent of their money like this just that's the cost of doing business and i imagine that's how they saw it just so happens that there's a lot of zeros behind it but it's the same thing if it's right it's eight hundred or eight hundred thousand right and and i encourage everyone go check out open start list dot com and go look so you could see ghost is on here buffers on here oh biometrics convertkit kit gum road there's a bunch of interesting companies that you can go and you can actually go and understand their business right like as up the ceo took aside and open up their books and i love looking at this type of stuff because it helps me you know clear you know paid to picture and and understand different businesses with very little effort yeah you see what and so i i was thinking about this the other so i was very close to just publishing my like i just did an annual review for myself about like everything like i had these goals you know what changed for me in my life my my you know did i my kind of personal development than my financial picture and i was like i just published this whole thing and i was like you know finger trembling on the button where i was about to click it and then i was like let me think about it before i because once you put your financial picture out there you can't undo it can i give you my opinion yeah tell me what you would do don't do it i think you should do it i think that if maybe you can like give like it increased by this much or like it's going well or like like seven figures maybe do that but i definitely think you should not do it i think that i think that there's a few things one if you're a company so people have told me about nathan lat and then cor the founder of indy hackers has told me about him he's like founders give him numbers and then they like regret it because people start copying them and they go to cor and like hey can you delete that and he's like well no i mean you like knew what you're getting into and you asked me to do this interview so no i'm not gonna delete it like we agree this is fair which she's right but it's like so it just like brings unnecessary attention the only up and then if for personal wise one time when i did hustle con i i like wrote a blog post saying like the first hustle kind made like right know one year about three hundred thousand dollars in revenue and it was like all profit and i was using that money to grow a business and people were like oh nice you have that much money i was well i mean like it's a business right so and i felt like that attention was actually really i didn't it didn't attract type of person who i wanted to track and then also but i would say that if you're trying to use it for marketing it's a it's it is an awesome tool for marketing like this means that's the upside right like you give up some privacy trans and and you know i i don't know whatever i guess privacy and you gain it's it's juicy a bunch of people wanna know about your kind of like your picture and if you if you're gonna give somebody a snapshot into your finances and how it's growing and how it's going then that's a good way to kinda hook people into the wider world of of your content right would do that's the upside but the downside i think is real then you should do that with your fund i don't think you should do it with your personal money i think say like we have this much money in the bank we've sent the checks to this we're gonna reserve it for this like that would be cool that would be a cool stick but i don't think i think that you would be unhappy if you did it for your personal life and even buffer they wrote about it they're like yeah this was like a cute thing that we did and it got us popular because i was like our only marketing channel but we actually don't wanna reveal salaries anymore and things like that because it causes tension and it's just not worth the headache right yeah i i think you're right i still might do it because it's just i and i'm curious what happens but do think your logic is right so so i agree with you what are you gonna reveal like you're like literally your w two income yeah like i would reveal everything i'd reveal what i earned across what is your say how my assets grew oh this is you know i'm not gonna ask her about this she doesn't she doesn't use twitter except for she went on twitter one time was like y who told by a husband to buy a day he said to somebody on twitter told him you leave them alone he's buying all kinds of shit that we don't need you should look up financial samurai so financial samurai i know i'm friends with him because he came to house khan and we became buddies like internet buddies so i know his identity and i don't i think that you can find it if you wanted to the financial samurai is a personal finance blogger he's a little crazy but he's cool i love him i like him a lot he runs in our circle and he reveals his assets and his income and office portfolio but you only know his name is sam and it's really you can't i don't think you could find a photo of what he looks like on the internet i don't think you can find his last name maybe but maybe not yeah right but he's he does this all anonymously and i think that's pretty cool right yeah that's cool i'll i like that okay what else we got to talk about so i think this was kind of interesting actually i'll do an idea first so i call you know this is d super retailers so what is this right now there are so many d brands and if you look at the kind of the framework of you know all businesses essentially bundling and un bundling which i don't think it's really true but it's catchy you know what's happened is you used to go to a retail store target you know whatever macy's wherever you're going and the retail store bundled all these different brands together and cool that's how people shopped and then right now what's happening is this big un bundling where people create you know there's thousands of thousands of brands they don't worry about getting into retailers right now they just sell individually online they acquire customers themselves through facebook and facebook is essentially the retailer right now that's where you find these products it's all on the facebook shelf and so everybody's doing this now if you go talk to any d company they spend like ninety percent of their time not on their product not on their customer service but on their marketing plan like they're all their you know their facebook ads their google ads their pinterest ads like this is where they spent either their email marketing they spend all their time on customer acquisition and increasing the lifetime value of the customers and so what's happening is i think there's a movement back towards hey let's say i'm i don't know lil what's a sexy d brand right now maybe maybe it's little let's take away luggage right so i'm away luggage i'm trying to this customer that's kind of like this professional millennial who wants like a high quality thing and doesn't wanna buy their dad's brand they don't wanna buy samson tonight okay cool why don't i you know sort of share my marketing efforts c you know c market with fire other d brands right so why isn't it a way luggage doing this with war parker and casper mattresses and everybody else because we're all spending the same amount of money to acquire the same person and so there's a couple different interesting takes on this one is there's one shopify app that is a post purchase shopify app where you install it in your store after after someone buys from you you up upsell someone else's product and if you do it you get money from that retailer instead of from the customer as like an affiliate fee so i thought that was kind of clever and i don't know how well adopted that is or some some gives and takes there but the other is to just create a destination at amazon like destination that is just a curated set of all the best new brands and you say okay i'm gonna find the best two or three brands in luggage and handbags and the next two or three brands and shoes and the next two or three best brands of socks and you you only have let's say the three best brands of every category and you invite those those e e commerce players onto your platform and you go acquire customers for your kind of like retail store that has many things you market it to them all the different products and you get a fifteen percent cut of everything you sell for these people because hey they're gonna pay facebook for that customer anyways they might as well pay you know a little bit less for you because average store might be spending about thirty percent of their revenue on customer acquisition through facebook so if they can get a customer for fifteen percent they've you know they've cut their acquisition costs in half and what do you think of this idea this is a typical show idea that i think is potentially a big idea but is like my default is like it sounds like a lot of work but so to default to optimism it's quite interesting i think that you're you're talking about two different things the first one is incredibly fascinating about the upsell so like if you buy in a way bag you're gonna be up upsell up sold like i don't know a blanket or i don't know what t sure it could it could be like you know gravity blanket or it could be more parker glasses or could be all bird shoes or or you know whatever something like that something that of traveler i don't know that's an easy thing to figure out that's pretty fascinating i think that when i have talked to people who do brand partnerships i think that they said in general they don't move the needle but i would like to figure out which ones actually do because some of them clearly do that's an interesting idea i think that's really fascinating i love that idea i think that's really cool the second one i think as a user would be cool but i have no idea why would a d brand wanna put their product there like wouldn't they just wanna own the whole relationship isn't that the whole point of being direct to their own do get the customer relationship so they come and they buy but the the d retailer would share the customer in insight unlike amazon it would share the customer info with that brand that that's kind of the the i think you would have to do that otherwise it i think it's quite tough but if you if you agreed to do that right so like i'll i'll find i'll find okay so let me let me give you the two names of companies i think are doing something like this so one i believe is called coop commerce so if you go to coop commerce so just c o p commerce dot com i think that's the one where it's the upsell upsell with something else there's there's probably another one besides that the second one spell the it looks like coop commerce i'm there it looks pretty cool and so you know you're gonna you're you're gonna acquire new customers through by putting yourself on this network it's like an ad network alright so like bloggers used to do this they used to create like blog roles where it's like cool i joined the blog roll network it'll put me on other blogs like like me like if i'm to tech blog or it'll put me on other tech blogs and then i get traffic and then i give traffic as well and i get sort of a proportional share and link share was like another one like this i think the guy from zappos started something like this before before zappos so yeah at the was the name of it so the other one is called the fascination dot com and so the fascination is is trying to build this is trying to build that super store i don't think it works exactly by the rules i mentioned like three three brands or whatever but it's basically saying we're gonna curate the best d brands we're gonna offer you know great deals on those products you know on our website and as if you would choose to be one of those brands you're gonna get a whole bunch of exposure because we're gonna get popular and you're gonna get free customers from us but you just have to give us a kickback of about fifteen percent on the on on anybody we send wait so what's the website fascination dot the is sex toys fascination dot com is metal stuff ralph fast destination dot com the fascination lose the the cell sex toys instead let me see okay yeah it's brand new it doesn't even break google it's not like it's not launched it yet so this is coming coming soon i think it's cool i like this stuff i think this is so cool have you seen this company called beta beta is that the pop up the life which beta does and they're probably getting crushed right now is they have these badass stores that they had in cool locations in san francisco la new york and probably many other countries or states and those are the ones that i saw and you i think the way it works is like boosts it's like anyone who has a nifty gadget it's almost like the new sharper image of sharper image anyone has a nifty gadget it could been like cute new brands like all birds but also like some fancy tv that you didn't know was cool until you saw it and you're like i that like demo well yeah that demo well and you pay us a rental fee to be there and you go in and you could you can buy it on the spot straight and it's badass that i don't know if that's a good business but this is kinda similar to that and it looks similar actually and it's quite quite interesting so so i have friends at investment in beta and i think they were doing well obviously covid i think is you know one of the worst things that could happen to them but it's b eight ta a so the the e is replaced with the eight so b a t a dot com and i like this idea because let's say you're a brand and a lot of brands open up these like kind of flagship or like for forgot what they call them like try on stores right space look we're not trying to sell here we sell online but if you wanna come and you know try our stroller out or like you know sit on our couch that we're selling we have a showroom in your city and those was really expensive and it's a really big undertaking for them to be like okay guys twenty twenty one that's the year we're gonna open up our showrooms in new york and la and san francisco and it's gonna cost us like three million four million dollars and it's gonna take a lot of time and all this stuff and so what beta let them do is be like push a button guys and you're in our eight locations or however many locations they have and it's like okay you're you're you now have a store presence you can send your customers there to try out your products or fill it out and you'll get new customers just walking in who like to see kinda new cool stuff was sort of a modern modern day version of like sharpen image mitchell like he said i really like that idea i think the idea of c good products i mean that is not even remotely new i love that business i think that is just the coolest business i love those businesses i'm in that business i curate stuff i love curation businesses i think that they're low cost start fast we talked about a curated airline or airbnb business we talked about a curated cool nifty products gear patrol does curation for outdoor stuff then there's you know is it called whoop not whoop the band but like wasn't there one called whoop that yeah whoop that was bought by amazon for like i think like a hundred million dollars i love that i think it's cool and let me tell you one more that is cool and sarah just bought a a gift or a a jacket out of here have you heard of metallic yes i i'm friends with jeremy the founder so the premise and i don't i don't think that this is particularly unique but i had never heard of it and it seems bad to me is they're like basically we make and i think get a lot of retailers say this that's why it's not particularly unique but they've done it well they're like we make mon claire or canada goose which are like two thousand dollar coats we make those same exact coats but without the brand and it's two hundred dollars instead of two thousand dollars or we make these fancy knives which is the same but no logo yeah luxury luxury quality without the lit luxury label that's the the stick and and ironically that's like i an even more high status thing to do is be like yeah this is a i'm wearing a you know prada level product but i didn't have to put brought on i i'm understated like that so we bought i bought or someone in my family bought another family member a like a twenty thousand dollar purse but it was fake it was from china and it even came with like a fit like a certificate of all here like no like a like a often like it was like it came with the box right and still a plastic on it and you opened it up and you had the label and like a certificate that says it's real like they just copied it perfectly and then we had a real one laying around and we like look like no could tell the difference and and so basically he's just made that dude this is a well so so these are yeah i i i guess these are kind of those are the logo those are really backups offs so i lived in china for for a couple years when i when i finished high school and my mom was like super into like luxury bags but was like you know cheap indian woman who was not gonna buy a louis vuitton bag like a six thousand dollar bag loved it but wanted it but would never buy it and so when we moved to china they had knocked offs february everywhere right you could go to the market and you would see like you know that same louis vuitton bag for for seven dollars but it was like clearly fake like you know the quality was just not the same and so there wasn't in between market and they called her the bag lady and this lady was ahead of her time so she only worked through blackberry messenger today that would be like you know whatsapp or wechat is probably what she'd be using but it was bb only you nobody knew her name and she had no low no steady location because like they're always after her to find her so she would do these pop ups where she would just dm and it she would bb and address she's gonna be there for the next two hours it was usually in someone's apartment one of her customers apartment where there's like a doorman and like they can kinda screen who's coming in and who's who's not so she can't get like raided and she had the most high quality knock offs that were or the her her claim to fame was you could take this to louis vuitton and at the time this worked now i bet to have some chips inside that like you you you know they can they can validate but at the time this was you could take this to louis vuitton and you could say is this authentic and they would say yes this is authentic and and so she would sell hers for four hundred five hundred dollars back so you're getting the not the six thousand and not the six dollars but you're getting the six hundred dollar bag that that looks and feels like the packaging is identical it was amazing and she would text out her location and a swarm of moms would come and this lady would probably make ten twenty grand in a two hour period and then she would pack up and disappear and she wore these like mask and glasses and stuff like that so you'd never knew who she was and i just thought this lady was like the ultimate dude if my mom i don't know if she did that or not but if she did do it whenever i got in trouble for doing anything i'd be like dude you're part of a fraud ring like you like you're like like you you fund terrorism like i so i hope you would have used that that i thought i thought it was amazing what he was doing at site one the interesting thing about this metallic model by the way and i hope i could say this i'll i'll i'll ask him but the cool thing i think the innovated on was not just finding the same supplier or like you know an identical supplier who could make who make the same quality but they actually went to them with a kind of no brainer offer so every supplier in china is constantly getting hammered on their their you know unit price so it's like oh we make this thing for twenty dollars and the customer always asking for eighteen and they're just you know they're always like pushing the pushing that down so what they did was smart was they went and said hey look we don't wanna hold inventory because that takes a lot of money and it's hard so why don't we do this is instead a twenty bucks what how about you get forty dollars per unit sold and mattress like what and he's like yeah you get forty dollars but i'm not gonna buy the inventory you make it and you could take the risk with us and you get double and they said to start with let's only do you know a little bit of the inventory this way and you can see that this actually works and as you get trust that we can sell the product basically you're gonna build it i'm sure there's some manufacturing term for this like consignment or like you know on spec or some shit like that but i thought that was really smart so they've been able to bootstrap this business or not bootstrap they've they raised money but like they've been able to be very capital efficient because they're not putting out you know five million dollar purchase orders to factories instead they're telling the factory hey share some of the upside but you make it at your risk and if we don't sell it you're you're out but but but you you could take that risk with us for more upside and the factories are more entrepreneurial who who try to do that i think that what we need to do is like break down the economics of that model of like what's better to be like walmart and just sell cheap stuff or to be like costco or sam's club and sell a membership and sell it at cost right i think it it'd be interesting to see what that needs to become like and i don't know what business is better i would think the membership thing would be far better well i don't know on metallic do you to a remember i don't think you do yeah maybe maybe you can be yeah ten dollars a month that that is it so they they still make money on the product itself so they're not like costco where it's at cost but what i like is it's asset light so even though the total money captured might be less their growth is gonna be faster and require less investment and therefore they're gonna own more of the of the pie because they're an asset light model they're not holding and buying all this inventory and so i think that there's you know that that's the pros and cons where they can just specialize in being an amazing marketing company and they don't have to worry about being you know you know a a a full stack you know a company that that's getting stuff made holding it in their warehouses and fulfilling it all that yeah i think it's cool i like i like these businesses i don't know how we're gonna categorize them but the i think that what i talent is doing have they raised lot of money are they big i don't know anything about least like i think ten thirteen million dollars or something like that is it going well yeah it's going well i think it's awesome i love this thing i think it's so cool thirteen thirteen million bucks but that's like the same thing like sarah so like if you go to their website right now you're sorry one example for people who haven't been there so they it says here's the november new member gift this leather zip card like a wallet basically it's like saint laurent i don't know how how you say these fancy brands but i think it's that ys l brand two ninety five is their price k i don't know what that is maybe it's some like secondhand hand marketplace it's like seventy five dollars and all like the women listening to this are like oh my god yeah it's it's like me saying like the dallas cob and and anyway that at metallic it's thirty five dollars right so it's ten times cheaper than the the normal retail price for the same product without the without the label so you know that fancy brand there's a fancy brand of pots and pans are like brightly colored again everyone listening to this is like you idiot it's called it's like cro cat or crow you don't them up we should just bleep all these out so that we save ourselves the embarrassment but yes i what you're talking about is it little leg cr or something anyway they make a knock off and it's daddy five dollars as opposed to four hundred dollars in which is awesome and then i and my friend had it and i saw it and then they also used he bought the knives from them and i was like jack this is a super sharp knife what is this he's like oh i it from my metallic right so i think it's great and sorry it tell sorry all the brands and the people are sending we're just bunch to basic ass dudes who can't say right alright dude that's like worse of the time that someone was like it's called tu i'm like it's spelled like t so i think it's cool yeah like the swedish got a different word for everything i tell you they they they should don't spell it like like it runs up mule if it's gonna if you're gonna pronounce it too oh alright a couple other interesting thing things okay here's another idea for you so i've been playing around with facebook ads you know on and off for many years but more seriously this year than any year before that and facebook i would say is probably the greatest marketing engine maybe of all time definitely of our era you know is created so much opportunity if you can take your product and be able to market it effectively on facebook you're able to reach you know the whole world at you know in one of the most efficient mediums possible right because it's med measured attributed and it's all you know you could use their their algorithm to figure out who's your buyer all that good stuff so if you use facebook ads it's like easy enough to get started i'll but it's not that easy and i think there's an opportunity for somebody to create essentially a course but it's not a course it's not me saying i'll teach you to facebook ads it's a game it's called the marketing game it's basically a simulator that that dumb down the facebook ad ui and ux and just like it gives you a chance to get reps at driving growth through marketing and so totally agree great idea great that so what i would say is i would say oh hey you created this shoe you wanna sell the shoe okay so you don't have to like take the time to like build the ad creative but it's like here are six ad creative pick one you wanna run and it's like set up your campaign who you gonna target you you know so it's like the dumb down ui it saves you all the time you don't have to actually go to photoshop and and create ads but you have them there and you get to guess like oh maybe the one where there's their base discount or one with the text on top or no this should be the video and then you click go and it's like you know sim city or whatever it's like it simulate it's like here's your return what are you gonna do take this money and do the next thing you're you're all i think you're on and you're off the way that i would do it this a brilliant idea but i would do it differently here's what i would do because the the the the the learn i there's there has to be a a category of like learning that this is under but this type of learning always works best for me and i'm pretty sure it's the best for most humans which is like you know when you learn how to play guitar you copy other people's work right yes you put you you go look up the cords to ed sheeran you know if you wanna go play a guitar and you do that for years and after for a while you're like alright i understand what works and what doesn't work i can make my own stuff that's the best way to i think that's the best you're right right you're right and so what i would do is i would get a list of all the most successful campaigns so like different ad campaigns that probably trump or biden used different ad campaigns that native deodorant use and i would say alright you see this campaign it worked really well recreate it yes perfect exactly so so so you you start and in the game it's like what do you wanna do you wanna be the founder of native do you be the founder of all birds do you wanna be the founder of the hustle didn't build a email list you wanna who are you targeting and what are you selling great you got that category here because the best pain that we've ever found right now first thing you need to come up with an image the image that works best for them was this now go out and find it yeah i totally we're gonna call it c academy for facebook is bra you said that's exactly what i have code academy logged up here quote academy is a a thing where you just longer because they're like alright we're gonna make this game type in this exactly so so the so many people have done these codec academy you kinda like learned to code platforms and they they also made it easy where so let's say you actually wanna learn how to code it's like oh install the python library in your computer go get a text editor you know that's gonna be where you're gonna write your code and then learn how to compile it learn how to get it onto to websites like fuck is also complicated just just the infrastructure is so complicated just to start and so what cook academy did brilliantly that other people did too is they made it like hey you go to the website and here's like on the right side is the output and the left side is where you type it's like cool first it's like in gray it tells you exactly what to type you literally just to re type what they already have it's like variable equal you know var equals six it's like oh you just set a variable great you know like now learn how to add two variables together and then like teaches you step by step how to do it and so i think that's really great it was a great way for somebody like me to actually like try to learn and get get my feet wet a little bit i think somebody needs to make code academy for selling or for marketing and and so the way you would do it is is i think you you put a great twist on it but i got really excited about this idea the other day because i was i i've i've been finding because i've been doing a lot of blogging to my my audience like i've done probably fifty posts in sixty days or something crazy like some crazy volume and one of the consistent questions is around this around facebook ads and i myself have trouble with it and i'm like fuck where do i even send these people to learn and i was like shit i'm just gonna start building tools for my audience to like to solve the problems that they have there that we right it's like i'm just gonna build a set of tools that that solved this problem and so this was the one that i was most excited about i think a list of six this is the one i'm most excited about look i think that's cool and i think a lot of people will be like whoa but how many people are running facebook ads it's like well one million people right a lot most yeah i mean how many people are running google ads like five million people i mean like what like enough and and this should be a part of every one million companies let alone all the employees doing it enough enough that you could build a big business by charging thirty dollars a month exactly and this should be a part of like every you know college curriculum high school curriculum something like that they should make this this this type of experience accessible to them if somebody built a good one and i think you kinda gotta build it a little bit like a game the code academy types try to ga five their stuff a little bit but the best ones make it where you get a sense of progress you feel like you're making more money or you're you're leveling up in some way and it keeps you motivated to like you you don't want learning the tool to be the game you wanna have to learn the tool in order to get your outcome you want in business that's why it works right i don't wanna learn facebook ads i wanna make more money facebook ads is my way to make more money so you gotta do design this the same way where the prize is the fun of seeing your character progress and the way to get there is to actually figure out better how to how to actually use these marketing tools i think it's awesome codec academy by the way how much is it cost they have a they have a hundred thousand paying customers they say how much does it cost it cost twenty dollars a month so what's that mean two hundred thousand is that two hundred thousand hundred thousand or is that two million how many customers they say twenty thousand a hundred thousand i can't do math i gotta carry my zero two million a month so there it's a twenty four million here it's twenty four million dollar business that's a hundred million dollar business a hundred million dollar company probably yeah i i don't know how many people there are who code versus marketing i have to think there's more marketers yes i would agree so it doesn't even matter it have to be the biggest thing in the world it's there's enough there's more than enough to build a viable business doing something like this it's hard i would say this is actually really hard to build though that's the caveat i think it's tricky to get it right in terms of like the psychology and how the product feels i actually disagree with you i i like it like there's all these like interactive things where just like looking at a screen and like the cursor needs to be moving and it's got a point like point you know it's like it's like the it's like microsoft clip or what's that thing called the it's like the paper clip needs to be there just pointing i think you can make it easy for people to go through but just like for codec cutting right it says seven years and forty five million learn learners later so forty five million learners have like gone through the system at at least and you know they have a hundred thousand paying customers per month yeah so you're gonna get a shit ton of churn because just like for codec academy right i turned out of code academy too because shit actually is pretty hard to learn out of code and keep going and keep the motivation there and that's why i think this is hard to build because it's hard to build it where you keep somebody engaged and they get to like you know they get through the program essentially i don't hear you forever i just think it could last for like like code county has been around for ten you say seven or yeah seven years i think it dakota academy could be around for another ten right so i think it's good i think we should do do i mean that was a pretty good one do we wanna end there yeah if somebody wants to build this with me ideally somebody like somebody good so i get a i always was ask that question i get one good person and i get ten like complete joker how do you know if you're good you're good if you've like actually like built stuff before that people have used and ideally in this case you understand the problem of trying to learn facebook ads so you've gone down and like it's kinda like how how i've tried to learn tried to learn how to code four times i'm actually the right person to build able to learn to code product if i paired it with a technical person because i know i've tried this i had i'm i am the customer i understand it so ideally somebody who's tried that and also best case would be somebody who understands games like you play games at least if if if not have built a game before because i think you need those mechanics in order to to give it the games are amazing lead designed products this is awesome youtube video if you could watch it's called you know mario like the genius of the first level of mario or something like if i don't remember what the video called but i talking about it shows like a vimeo video it shows how mario has no tutorial right most popular game no tutorial on how to play how to jump what's the objective am i trying to get coins how do you learn all this well the way you designed it so first it shows your mario you're standing there all of a sudden the screen starts moving it's pushing you forward so you already know okay gotta run to the right alright like the the motion of the of the level tells me where i'm trying to go go right then this goo comes and he's got this angry face so you know this is probably not a friend who's gonna give me some potion is probably an anyway that i need to do something with but i don't what to do and then they show that like where the goo meets you you also have these boxes above you the the the coin boxes that have question marks it's like well that's intriguing i'm gonna wanna hit the question mark and so you jump you get the coin and then you almost always will land on the goo head and kill the goo and then you see that satisfying goo gone and you're like oh good i know what to do now and then you see two more question mark boxes and you're like oh how do get to those i guess i could jump on this to get to there and it's like with no tutorial you've now learned all the mechanics of the game you're trying to go to the right to the end of the level you gotta kill these goo by jumping on their heads and you wanna collect as many coins as you can in these boxes and sometimes there's other stuff in the boxes like a mushroom comes out of one of the first first four boxes ama mario and that's how you wanna design prop great products is where you actually don't need clip you just make it where there's really only one thing you could do and that's the next action you you need to learn as a as a player in the game of like oh click this good thing happens great now i know when to use that technique bra you just shared it it's called how nintendo made mario's most iconic level and it looks like two they're speaking in japanese it looks like the the developers are explaining it all right i don't think it's the developer but it's some some guys explaining yeah it says really they're they're using the word we like you know we made it this way oh really that's amazing okay great what's his name mar moto or some of that mi moto mia moto yeah what what a what a legend bill and mario fucking amazing yeah those guys are legends to me i mean it's just so cool like when i think about these japanese guys making mario i like it's like kinda of mythical to me right okay great i gotta run good stuff enjoy your new house good episode