Okay. So the news is this.
If you've been listening to this podcast, you know that Shepherd is a business that I'm a part owner and I've been talking about it on the podcast and it's a great business and last week news broke that there was a private buyout of a majority stake in the company for 52 million at a 52 million dollar valuation. It was done by Nik Huber. I had the opportunity to sell my shares in that I decided not to not a single share. I'm holding every single share. So today we're going to talk about I guess we'll tell the story of you know, how Shepherd even grew in 4 years to be a 52 million dollar company how I ended up getting involved with it becoming a owner in the business and why 1 of the owners in the business did this buyout how they they took 29 million dollars and bought majority controlling stake in the company. So that's the news now. Here's the back
story. I feel like I can rule the world. I know I could be what I want to
Uh, I put my all in it like no days off on the road. All right, Sean, uh last week you guys had a big announcement. So you and Nick bought Shepard and that's amazing and I didn't I didn't do it Nick did it not me? Yeah, but you were part of it. You were part of it. You're you're you're 1 of the partners and I guess maybe I'm going to interview you at least for this first segment because I want to learn all about it. Sure. I think it's amazing what Nick has done. So let's start with the beginning explained what Shepherd is and then I guess we'll start in like 2020 when it started and explaining like how it grew and what happened last week.
Yeah. So there's a guy named Marshall hos who was entrepreneur done a bunch of different things. I think he owns like a hotel in St. Louis. He had a bunch of e-commerce companies some goofy. 1 like some Emoji something something something then he had peel which was like a phone, uh phone case type like a thin phone case. So he was in e-commerce and 1 of the common things with e-commerce is e-commerce is like a real business, but it's like a lemonade stand business every margins matter. And so what a
lot of e-commerce operators do and I did this too with my e-commerce brand. I think 60% of our staff is is offshore is because margins matter you have to figure out a certain specific problem, which is
How do I get great talent at without paying the full cost without paying the full cost of hiring Stanford grads and Harvard grads or or you know even just a normal median worker in the states? And so
a lot of us we go to Talent hotbeds like Latin America where you find great programmers or data analysts or the Philippines where you can find a great customer support team that will um, you know do the job at a fraction of the cost usually about 5 times less than it costs in the states. So 5 times less is like pretty massive. So Marshall's running Peele, he starts hiring more and more people overseas and he decides to start a company called support chipper, which at the time was ridiculous.
I saw I'm friends with Marshall on Facebook. I've been friends with Marshall since 16 or or 14 when he told me he was doing this. I was like, this is silly but then I saw The Branding the website pretty much looked the way it
does now from the beginning. Well, he uses your favorite color of green as well. And so and so he he creates this brand and you're right like, uh, the idea of hiring Talent overseas is not new. This has been going on for a long time. I remember my dad once bought. This book called The World is Flat and I was a little kid and I read this book and it was all about globalization of talent. Uh, and it was something that big companies were doing but more and more small companies have been doing this startups, uh, and the like, especially
Especially for specific roles, right? So anyways, he starts his company and it starts doing decently. Well. He's promoted on Twitter and starts to grow. So now Nick comes along Nick Huber from sweaty startup. Exactly. Nick's got a storage company. He's in the real estate space and what people don't know is Nick has certain companies like, um, he has a cost segregation business cost seg is basically when you buy a property you do a cost seg study and it allows you to accelerate your depreciation. So instead of depreciating something over 30 years, you might be able to accelerate the schedule to 7 years. It saves you a bunch of money in year 1 so it's well worth the it's well worth the trade to go pay for Co egg study in order to save the money. So most people who do a cost seg, they hire us Talent what he does all of his talents like in Colombia, they do it on an iPad you like walk around with an iPad
right? I'll explain how it works. So the way it works is and I'm far from an expert the way that I understand. It is basically typically real estate has something like a 30-year lifespan, but they came in and said look the rules actually say that your windows can depreciate in 10 years. Your roof is actually
Only 15 years. So what I need you to do is do a video tour with 1 of our people on the phone and I have a a checklist of things. I need you to show me in the home and you got to walk through and spend about 30 minutes. Just walking through the house and I did that and the person was I knew he was I mean, he spoke perfect English, but I thought he was overseas and I was like, I actually don't know where you are. For some reason. I thought I was in Europe. I had no idea where he was and there was a guy in the other line as I'm like looking through the house and he's marking down what type of Windows I have and things like that.
Right, and so pretty crazy that used to be something you somebody walks on foot through the building and has a clipboard of the piece of paper and now you've got low-cost talent in Columbia that are getting it done for you. Alright. So anyways, he builds that business. So he's using shit heard a lot. So he ends up going to Marshall and uh Cuts an affiliate deal. I think initially it was an affiliate deal, which was just hey,
Uh, if I send you traffic if I tell people hey, I'm using Shepherd's great. Give me a cut of the fees that you that you generate. The revenue that you generate. Marshall says, yes next start sending traffic and along the way Nick goes back and he says, you know what Affiliates great, but my beak's not wet enough. I need a little more skin in the game. So he cuts a deal with Marshall to end up becoming a part owner of the business.
Business continues to grow last year almost a year to the day. I become a partner in the business. I approached Marshall I say hey same same story. I'm a power user of the product. I have a big audience and um, I think I can help grow your business with did this all come
from the place of it'd be cool to grow company based off of your influence. I had a lesson which was invest in your
p&l and this was a lesson. I learned the hard way, which was when I was running my startup studio and for 6 years. I was trying to make a successful chart. I was trying to be successful and make money and what I learned in the end was that a lot of the I would have made a hundred times more money had I simply look at our expenses in our p&l.
And just knocked on their door and said hey, can I invest I'm a big fan of your product. I'm an early user of this product. I really understand this product. And whenever you're raising your next round of whatever valuation do that, maybe I can help you out in some small way. And you know, we were I was 1 of the you know first I don't know.
200 companies using slack, uh elastic search pager Duty. We were using early on figma. We're using early on like all of these like tons of them, but I I don't even know like there's like 20 apps like this. And so I learned this lesson the hard way, which is you. Oh, you should always try to invest in your pnl. So you look at your expenses you figure out which expense is Meaningful. It's a line item that you notice but you don't regret it. So an unregarded expense meaning it was worth more than the than the cost. And so I looked at mine and I was basically like
This overseas recruiting is 1 because I'm getting great talent. So I went to Marshall and I said, hey love the product. I said I love this category too. So I said I'm not for sure going to invest in your business, but you're my first pick and I'm going to I I use your products. Let let's talk and so we uh, we ended up working out a deal and it was a a a great deal for me what actually I thought at the time was a great deal for me. It turned out to be an even better deal for Marshall. So he had a lot of uh wisdom in making that deal because I thought I was getting a very favorable deal but he understood the power of the audience and he understood the power of what we could bring to the table and he listened to MFM. He saw what we were doing on Twitter. He had no Nick had come on MFM before and mentioned it and it was like the biggest Day in the year or something like that. So he kind of had a he had enough validation to take a leap of faith. Uh, but it was still to be clear a leap of faith.
Hey, let's take a quick break to tell you about our sponsor. There's no secret formula for customer service. But there is an all-new service hub from HubSpot and it's bringing service and support together in 1 platform. So you can deliver the best experiences possible. You can free up your customer support reps time with an AI powered help desk. So you can easily support and grow your customer base. The Secret's out servicehub is a game-changer visit hubspot.com service to learn more.
so
It turns out better than we expected like we had forecasted how much we thought we could grow the business and I try to over always under promise over deliver type of thing. So I was like look, I think we can you know, maybe 50% maybe 75% we basically grew up by 300% So the business is basically tripled in the last year valuation grew and along the way different acquisition offers came up and I went to Nick 1 day and I was like, hey, look there's acquisition offer. I think this thing still got a lot of Runway to run and actually the initial idea was Mick. Why don't we what if we bought it what if we raise the money and we bought this thing so most people don't know that that was the initial conversation and Nick's like I I'm thinking the exact same thing. Uh, let's talk to Marshall and see.
Within an hour. I'm like too much work. Never mind Nick. I don't want to do this. This is too much effort for me. It'd be a huge transaction like heat by this business. So what what actually ended up happening is
Nick announced he said big news yesterday. I acquired a controlling interest in support Shepherd for 29.7 million. So he paid 29.7 million to buy enough to become a controlling owner of the business. I think he said the valuation I think yeah, maybe they did a different 1 52 million was the valuation. They said 52 million.
And so which is pretty amazing because from the time 1 liter 1 year ago. I think it was April or May that we we did the in my deal that means the value of the company had more than tripled in a year. So, you know just tremendous value growth a win for everybody involved my state grew Nick state grew Marshall did obviously phenomenally well and Nick goes and he basically raises the money and so he raises the money to to go and buy, you know, basically for 30 million bucks. He buys to control and stake in the business
my little crew. We we threw in a little bit
welcome to the team finally. Yeah.
We're we're very very very small stakeholders, uh amongst us thing.
It was hurting me to get rich without you. I gotta be honest.
It kept me up at night a few days. That's all right. We we we have a very small taste of it. But okay, so it here's what I wanted to bring up about 2 or 3 years ago you and I did a podcast where
We said look, there's all these people who have created billion-dollar companies off of Instagram. They've done it off of YouTube. Um, they've done it off of Facebook. There's not really been any breakout hits off of Twitter yet because Twitter's audience is a bit small. Uh, but I was like, I think it's good. I think we both said it's great because it's text based you get to know people whatever and there's it's a B2B crowd a little bit more so
high value crowd.
Yeah more so than the other places and it hasn't happened yet.
But I think it is happening right now. I I think I don't know if this is gonna be a billion dollar company, but I think the fact that Huber, uh, like went out and raised this money to do this that is a big swing and it took a lot of Courage for him to do that and it could our our prediction could be coming true as we speak very ballsy move. I gotta say very ballsy
move to do this and I tweeted it's like a ballsy move. I can't wait to see how this plays out and people thought that was a negative thing. But to me, I literally just met like oh my God, I can't wait to see how this How This Ends like, what is the story? What is the story going to be and I think it's going to end really? Well, it's
not ballsy the way it's ballsy that he took the ball in his court and he's like trying to do this thing. And I and by the way when I tell everyone is I don't want to bet against Nick Nick is a is a really good entrepreneur and if someone could pull it off I I have faith that he can
pull it off. You know, when you watch somebody play sports you learn a lot about them and I played basketball with Nik Huber. He is a he's a Workhorse. He's an incredibly physical player. He's an incredible. He comes to the pickup games with a mouse with a mouthpiece in it's like bro. I don't know how much contact you're planning for, but it's more than I was ready for today.
And so you see you learn how he operates. Let me tell you a couple things about this. So Nick could have been on cruise control.
The guy owned self storage facilities Self Storage is literally a closet you lock. It's the like the least operational thing you could possibly do is literally put your put your objects in this door and lock it forever. Like that's
all it is. I don't think it's a hundred million dollars worth of self storage units that he owns. So it's a significant amount. My point being is he's kind of uh, financially he uh, he
could have been he could have been a good spot. He loves to hunt. He's got little kids. He loves to do outdoors. He loves to play sports. He could have just been chilling then he has a Twitter audience. So he starts he could have done affiliate deals. He started launching all these agencies. He's like, I got a SEO agency. He's like, I got a Hiring Agency. I got a um, you know, I forgot what else he has. He's Casa. He's got like 7 different agencies. He started and each of those would have brought in. I don't know 50 to 100K a month enough. He could have been totally chill.
He
chose violence he chose to not chill he chose to bet his entire career but his entire network and net worth on the line. Basically to say this is to take this.
bold bet
and you love to see it. I love
to see it. I don't think it's going to fail. I think the even the worst case it's it's a very survivable thing. I think best case is is quite huge. It could be a very big outcome for him. And I think it's so cool that he's doing this.
Yeah. Yeah it is and like look I thought we were taking a big bet when like when I put my name on something or Nick puts their name on something.
It's got to be good because we're spending all this time years building up a reputation years building up a loyal trusted audience at the end of the day. You got to turn over your cards. And if you don't have if you don't have the hand, you know, you were just bluffing the whole time and you can't do that. Nick took it to a whole new level which is to basically say forget all my other shit. I'm going all in on this and I think that's that's really awesome. Okay, so now let me tell you the big picture take so forget Shepherd for a second. This is part of a general idea. I've had for a while a couple years now, which is the idea of an audience co-founder. So when I started my first company companies, I knew I needed like I myself as an entrepreneur could do part of what was needed to to succeed to succeed. You need to build a great product, you know, you say identify a gap build a product that fills that Gap you have to have a maybe a technical uh team in order to build the product you need money. You need a bunch of things and as a Founder you try to go do all the things you try to identify the Gap you try to go raise the money you try to go recruit a team.
But it's hard to do by yourself. And so very common in Silicon Valley is to have a technical co-founder and a technical co-founder is you know, that's the person who's going to do the the engineering the building and you rely on them to do that. And you're saying I'm going to do the the the other components of this business. Well now I think there's a more and more common.
Playbook which is the idea of an audience co-founder what an audience co-founder is you partner with somebody who has a has a cheat code in go to market, right? They have a Advantage. They have an unfair advantage that is a non-folding zero sometimes negative but definitely lowers it which isn't new.
This isn't new, you know, George Foreman and then since the beginning of time we've talked about celebrity Partnerships
of exactly so so they've evolved and so what that's what I want to bring up like the evolution of these. So for example, you got the Foreman grill and it used to be you hire a celebrity they hold your product. They smile by this product, right that was an endorsement. Then the then the the the audience people they they got a little bit wiser. They said ah instead of just taking cash for this. I'll take some Equity too. Thank you very much. So I started taking Equity too and you're going to put my name and face on it. Then that means I'm going to have to own a piece of this. So you get the form and Grill you get all of these celebrity alcohol Brands you get McGregor doing proper whiskey.
I think McGregor owned about 15 to 20% of proper whiskey you have Logan Paul and Prime. I don't know but I think it's something on the order of magnitude of 20 to 30% You've got Clooney doing his tequila. You got the rock doing his tequila. You got Ryan Reynolds doing his gin. You got a bunch of people that do the the sort of celebrity alcohol brand the celebrity Cosmetics brand right Rihanna with Fenty Beauty. But but each time it's getting a little more and more tied in with the co-founder. So you go from hold up the product and ding play the jingle to put in my name and face on it to actually it's named after me. Actually. I'm going to be the 1 creating the media that we use to Market this thing and if you paying me twice a year to come to some to some commercial shoot. I'm going to be posting every day. I'm Kylie Jenner. I'm going to be posting every day on my Instagram stories about this. I'm Conor B. I'm going to be reposting tons of material on this. I'm going to take a bottle to the press
conference.
I'm Logan Paul. I'm going to take a a, you know, a bottle of Prime with me to WrestleMania when I'm uh when I'm and I'm going to use it. I'm going to crush 1 right before I go in the ring and so the celebrities become
more and more involved and now what what's happening is this is transitioning out of
Major celebrities doing major, you know, uh consumer products to more and more what's happening in the software space, which is more new I would say so you have yeah Russell Brunson do this with
clickfunnels.
You have hormozi just bought a chunk of school. And now he's wearing a school hat and a school white beater everywhere he goes because he's trying to promote that product and so you see what me and Nick did with Shepherd and you see that basically these brands that are almost private Equity Brands, right? So we build a consumer-facing brand and then we do private equity and the beautiful thing is that the private Equity guys don't know anything about brand and the brand guys don't know anything about private equity. And if you happen to be somebody that knows about both you're a pretty unique, uh proposition in the market. And so I think we're going to be seeing more and more of these audience co-founders or people realize that I can either just take a bet that my product will get off the ground that I can get out of the kind of the the the muck of similar products at the sub-scale and try to break through and they're going to use their cap table as a tool for
To do this and um, I I I narrowed it down into 3 things that I think you need in order to make this work because I think there's going to be a lot of people that try this and they're going to fail and here's I think the 3 essential things you need in a audience co-founder.
the first
a large trusted audience trust being the key word here. There's a lot of people with an audience but they have low trust meaning if they go tell people hey, you should go try this. You should read this book. You should try this lotion. You should show up at this event should watch this movie how many people actually go do it and I'm not going to name names or there's a lot of people that we know that have audiences but they don't have anything for trust or they have audiences but Their audience is broke. And so the only thing they could sell them is
very cheap things for broke people basically and so you have to find the right trust somebody with
a trusted audience. So trust that's quite challenging to measure but large is easier so I could tell you so our podcast MFM if you measure YouTube including shorts, which you could argue and I would agree with it that shorts is nonsense, but we had something like 90 million impressions last year across the podcast and then if I had to guess your Twitter handle probably had another 10 to 20 a month, uh million impressions and then your newsletter. I don't know how often you say that you said it once a week. Let's say let's keep a round number of 100,000. So you're talking to million tens of millions of people a month. Would you
say that's accurate know to be honest? No, I think that number of people is a lot less than the number of Impressions.
Sorry for sure tens of millions of questions. I don't know how many people maybe a million maybe more than a
million. I think I think I think we reached somewhere between half a million and a million people truthfully,
right? And
there's a lot of people that will exaggerate these numbers truthfully. I think that's the ABS
Absolute ceiling of what we reach but then the trusted audience is a fraction of that but um, it doesn't matter. It's it's the depth of trust that matters and this is the total mispriced asset in the market because the easy thing to measure is number of followers number of views number of of of Impressions that something gets a little bit better might be likes or replies, but then even better is bookmarks even better is how many people click the link and then the ultimate source of Truth is revenue. There's other tests that I like to think about. So another trust test is um, and I talked to a guy who who's getting millions and millions of views on shorts.
And I said, um, hey if you tweeted out tomorrow.
That you are um hanging out at this coffee shop in Austin.
And he said hey, I'm hanging out from 10 to 2 tomorrow or 10 to noon 2 hours. I'm hanging out, uh stop by.
How many people would show up?
There are some people that would have a line out the door.
And then there's some people that nobody would show up for because they have a very fleeting transactional impression based thing. They are not the focus of it. Maybe they're putting up meme content or they're putting up, uh, you know, like canned videos that are highly animated, but they're not even involved in it. There's no trust that's being associated with them. Um,
Another trust test if I email my list tomorrow, and I said tomorrow, I'm putting out something that I've been working really hard on that.
It's fucking good. Trust me.
And I said it's it's it'll be available at 5 a.m. Tomorrow and it's gonna be available to the first thousand people that that try it that's it. How many people would set their alarm? Right right. There are certain companies of products. You set your alarm for Apple gets people to set their alarm and come camp out to get their new product. It's trust the other day, right? That's the that's the measurable value of a brand is trust. And so I think that's the the number 1 variable.
Hey, let's take a quick break to tell you about our sponsor. It is a podcast that we want you to check out. It's called D. Toc pod. It's hosted by Ramon Barrios and Blaine bless. It is brought to you by the HubSpot podcast Network the audio destination for business professionals. And this is a podcast about all things direct to Consumer D. Toc its e-commerce stores. It's how you optimize your brand and they're talking with Founders marketers and the platform creators about all kinds of things that you need to know for D Toc, you know website conversion pay ads Facebook ads consumer Trends email marketing. If you want to know the stories behind your favorite Brands this podcast is for you. They did an episode recently about scaling Creator growth and influencer incentives. I thought it's pretty cool. So check it out. Listen to DDC pod wherever you get your podcasts.
Number 2 product to audience fit. So basically, uh, if I came on here and I started telling you about Cologne it's not going to work. It's just the wrong product for the wrong audience. Uh, it's not what my audience wants. It's not what they trust me on. It's not the right price point given the the uh size of my audience right? I sell products that are worth tens of thousands each Logan Paul sells products that are worth 4 dollars each but he's got a much bigger audience. You got to find an equation that works. So product audience fit a great example was the episode we did with Dani Austin on this podcast. Dani Austin was a woman who was she was uh, she had struggled with postpartum. I think postpartum hair loss and was really insecure about her hair. She wore wigs for like a year. Then she took the wig off and told her her Instagram audience like this is what I've been going through. I feel a little bit silly I felt insecure about it, but I'm trying some things. Let's see what works and eventually ends up creating her own line of Hair Care called Divi, which is a a product to cure this pain point that she authentically had that many people in our audience that we had and trusted her.
For it. And so the highest the highest version of product audience fit is when you genuinely authentically experienced the problem and can tell a story about it and that story resonates with your audience because they also have that problem and they believe your story.
third 1 content creativity
So how good is this person at creating an ongoing stream of content that plugs the product dude that's shockingly hard by the way, very hard to do. It's very hard.
I'm good at it. I think you're good at I think Nick is exceptionally good at it as well.
Nick is fantastic at it.
I he posts probably I think a 100 times a week on Twitter. I looked it up and
he's good. He makes hits
and you see this everywhere. So, uh when Logan Paul and and KSI launch Prime, they did a photo shoot. They did the photo shoot of them drinking and then there's this viral image. There's this image that goes Super viral and it's basically, it's Logan Paul drinking Prime in case I drink a prime but in case I was kind of like bent down on 1 knee and then somebody photoshopped them together, so it kind of looked like KSI was you know, like going down on on Logan Paul and then they printed a cardboard cut out of that and they put it in the aisle of I forgot Walmart or wherever they were launching. So they the news was we're launching in Walmart and many. Okay. What is a Creator do normally? Hey guys, just so excited. Uh, can't believe it. We launched in Walmart good for me. Um, you know, uh, go go check it out, please go buy our product from Walmart, right? Well Logan Paul does a smarter route is he knows how to go viral around his product. He knows that it's not about patting yourself on the back. It's not about a generic announcement. That doesn't mean anything to the audience. He gave them a reason to share the news which was
Put put him in KSI and a compromising situation made a joke out of it. And then that image goes and gets 100 million views. Right and it's the same story. But he knew how to package it to go viral. He'll also do things like, um, he'll create content.
That'll be um, I'm gonna try to make this drink using these 3 fra flavors of prime. So it's like it's kind of like those will it blend type of commercials? But he's using his product, you know for us we will do like me and Nick we would do um a workshop where we would we did a like a delegation Workshop. So I was like look
is that what most people call those things? I mean
haters will call them webinars.
Uh, yeah, but they're called haters. You call a webinar. I call you a hater. I do it with a W word I could think of it. It was Workshop something like that. Yeah. It's on the web. I forget it's kind of like a seminar
but we would do these things and they would drive so much business for the for the business. And so we would we would come up with what is a value add thing. We could do that delivers so much value in 45 minutes and at the end we just say, by the way, if you want to do this Shepherd's a great tool, but you've delivered so much Goodwill and so much value that you can you can do that. Anyways, there's a whole bunch of stuff around content creativity. How do you end an ongoing basis? Uh, create native content that is going to continue to bring the brand front.
Center or do we created The Thrill of the shill for example to give ourselves an excuse to talk about our products? And so there are creators that are better at that and there are creators that are worse at that. We're you know, we're good but there are people who are incredible like who
do you think is the best?
Like who do you look to besides? Uh, some of the maybe some of the non-popular ones?
Is there any non-popular ones you look at and you're like that's really great. There's a guy on Twitch named Dr. Disrespect that I first noticed is incredible at this and I noticed it because the majority of twitch streamers get a ton of blowback if they ever mention a product a service.
Chat immediately sell out sell out sell out. Oh my God, whatever.
Dr. Disrespect created a brand that almost allowed for it and he created so much humor and content. It's like you don't want to be in the middle.
So either you just never sell out.
Or you try to try to sell product but you're trying not to sell out you're sort of hedging and the audience can sniff that out a second and they will pounce on you.
Or you go full you go full sell out at twitch. We even did this when Amazon wanted twitch the company to promote Prime day. It's like, oh, how are we gonna do this? Our our community is very sensitive to us promoting something specially promoting a big Corp Mega Corp like Amazon and so they created a campaign called twitch sells out and they
made yeah, you gotta make a joke
twitch sells out. And that was the whole campaign was well today twitch sells out and then they basically like they leaned into it Dr. Disrespect could do this. He he would do a promo promo with Old Spice and then if he would create like a full like a full like content series around this thing around Old Spice and he would do it in such a way that by the end of it the whole chat was looking forward to the next Old Spice. Like if if I already called it like the Champions club or something like that. You would create all these little things around it because he was a total character he knew how to do it. So he was I could see how much money he was making he was making way more money per viewer than the average twitch streamer because he knew how to monetize that
audience to remember we had Justin mares come on and he told us about his new company called.
Is it true Med or true medicine Tru Med? Yeah true Med. So true Med. Um, I how do you explain it? Is it HSA spending? So it's like a a kind of a boring topic but basically like you could spend your insurance money. Anyway, his co-founder is this guy named Kaylee means and Kaylee means is uh, I guess he's a I think he's a doctor or a former doctor but he's like obsessed with metabolic health and I followed him on Twitter and he is indoctrinating me on like a healthy eating.
I bookmarked his thing yesterday saying it was like the 4 Points 4 thing like, you know, basically he's like America has like, you know, a 20% obesity rate or something like that in young kids and like other countries have 4% Here's the 4 things. We should do immediate effective immediately to turn this around and I was like, sir. Yes, sir, you know, yes daily for president. I've never met this guy, but God damn he's convincing
he is so convincing and so he his company and he does it in such a good way because his company is a very specific thing HSA spending and you can buy like healthy stuff. I think you can buy like an 8 sleep mattress.
Or whatever using like your insurance something something like that. But anyway, he'll he his whole Crusade is on like processed foods and over and being overweight and things like that. And so he's like, uh, a renegade and a champion for like healthiness and it just so happens. I have this thing that I that you could actually use to like buy some of these things. So like he tweeted out the other day. He's like America's super obese. Here's 4 Points like you shouldn't be able to use um, uh food stamps on soda or uh, I a pharmaceutical company should not be allowed to advertise on TV and he had like 2 or 3 more things and I get upset with it and he started to change my opinion and then I'm slowly starting to think about true Med his
we should have him come on, by the way because I've seen him now do a couple of these Rants and each time. I am so convinced. I'm so convinced that I actually schedule time on my calendar to look up opposing evidence.
Because I'm like before I just fully bathe in this Kool-Aid same I need to hedge myself. I need to create some firewall where I go. See if this guy's full of shit because he is very convincing. He's very convincing and this is a
really good example. I asked you for a non-popular example, I guess I had 1 Kaylee means is a non-popular example of a well. I guess he's I mean, he's not like mainstream popular, but he's somewhat popular in our little circle of of B2B product and he is selling it wonderfully. Absolutely.
Yeah, I think it's uh, I think it's amazing. Uh, there's a bunch of these by the way liver King Nick bare like a lot of guys do this and I think the the interesting thing now is it used to be celebrities hold up the product and endorse it or it would be the celebrity creates the company themselves. What I'm finding now, is this interesting new new variant of this the new strain which is company that already exists finds a audience co-founder to accelerate growth. And by the way, if you're trying to do this come to me I want to do this again. I want to do this 1 more time. The shepherd thing went so well, uh, and I I tweeted this out I go you if you have a cash flow.
product
that is genuinely a great product. Like it has to be a great product. Otherwise, I'm not going to put my name on it. Um, and you are bootstrapped you are not on the Venture path. Hit me up Sean and sher.com. I want to do this
1 more time. You have this thing on here about the curse of family riches and I want to talk about that. But before we talk about that, I want to tell you, uh a story about someone I spoke with recently.
So there's this company called Simple modern. Have you heard of simple modern? Of course? So simple modern is a website that sells basically mugs, but I think they sell a ton of stuff. So like Stanley mug competitors tumblers, they sell a ton of stuff. I talked to him the other day and he gave me his annual revenue since they started the business along with the profit from some of the recent years and he said I could talk about it. And so I listed it here in this document. So
when people give you their revenue, do you just go do you just like evil laugh or what do you do? Well, whenever I talk to
people I'm like hey before we even have a conversation just so you know, I'm not saying any of this um, and then in our 20s,
we tried to get girls numbers and our 30s. We tried to get Guys numbers.
Yeah. Yeah. I want to know those people's uh people's income. But then at the end of the conversation, I was like dude, this is so fascinating. Can I share this or not? And he was like, yeah, dude. I don't care you could share. And so anyway, he started this company 2015 and 2017. They had 10 million in Revenue 18. They had 20 million. They grew it and I'll I'll skip a few years up at 21 they uh got 80 million 20022 at 95.
0023 this most recent year. They did 180 this year. They're expected to do 225 million selling these tumblers. It's mostly tumblers and he started the company with like 200,000 dollars in his 30s. And so his bootstrap company. He owns half the business because he gave a away a lot of the the the business to employees and I was uh asking him about it. And by the way in 20123, they did 180 million revenue and 45 million in ibida in profit. And so he's been able to make like a significant amount of money. But the reason why Mike was so fascinating to me is he's based in Oklahoma. So he's just like real soft sweet. Wonderful. Nice guy. He's uh, I'm sure he's aggressive in business. But when you're just hanging out with them, he's like a sweet man, and he was like, I started this company because I wanted to do 2 things 1
I wanted to just build a business that I could hire people who I admire being around and number 2. He uh, he's like, I just wanted to give away a lot of money. Like I I feel like it's my mission to like give away money. And so this guy since the beginning of the company the company has pledged to give 7 or uh, 10% of their profits away to Charities and the people within the company vote where the charity goes to and so he actually doesn't have control he set it up. So everyone's a lot of votes but in the meantime, he's been giving away all his money and so he's giving away something like a hundred thousand dollars a month of like the Beckham family money and he like said what is he's like, I I've I've been able to save up like, uh, 4 million dollars, but I'm still giving away something like a million dollars a year right now. And I don't know if my 5 million liquid net worth is going to go up a significant amount because I intend to give as I go and he's been giving since the beginning so he's like when it started I was giving away 5,000 a month when I was making, uh, he said, uh, what did he say? He was like when I was making 200 Grand a year. I was giving away 5,000 a month and my intention is to continue giving so when I die
I don't have a lot left. I've given it away as I've gone and he was like basically like I kind of wanted to be generous when I was alive not when I was dead, which is what a lot of people do.
And I don't know if I'm gonna leave any money for my family or not. Maybe I'll leave them enough that they have a little bit of something but we're going to give away most of this. So he's like my net worth right now is probably 200 million based off the value of the business. I'm giving it all away and I was so fascinated by this and it really actually inspired me not enough to take action because honestly, it's still
it's still a bit fearful if I'm being honest, like I'm so quite fearful of it, but he seemed so freaking happy talking about this. Do you give away any money at all like this?
Uh
a little bit. Yeah not like this. Um,
Sounds like he's giving away 20% of his.
Liquid net worth per year something like that. Yeah, like a significant sum and and his liquid
network is growing because he was like, this is the first year that the business he's like we're going to do 45 million in ibida. It's the first year where like we don't have any new ideas within the business. So we're going to take a big fat dividend and I'm going to end up giving most of that away. Uh, and I'm just going to give it away
as I go 2 parts of this impressive 1 is uh money where your mouth is. There's a lot of people that that talk about. Oh, you know, I want to be able to give things away and then they live their whole life and they're like, it's like the Sam bankman Freeds of the world where it's
Did you give any of it away what happened? What happened to that? He was giving as he goes. I think that's really really really great. Some of the happiest people. I've met in life are the people that give the most some of the most successful people. I I know in life, um are people that give the most and the the more interesting thing is of the people that give the most they've been giving from the beginning.
I think that's the real takeaway is like the fallacy that when I have enough then I'm going to give
and it just creates this like internal fear of you know giving away, right? Um,
You know this last year we did when we had uh, Scott Harrison on.
I did the thing where I gave away my birthday. So I basically said, uh, I'm turning 35 I'm gonna give 35 thousand dollars to charity water. I'd set it live on the pods so I can I can say that out loud here and then I encourage you go. Hey, if you want to give me a gift go to the trade War thing donate the gift there. Do you know how much that race? I think it raised like about another 30 or 35 thousand. I think it raised 30 thousand. So in total this pod gave you know audience people gave 30,000 I gave 35,000 and it was an uncomfortable give like not that
Like it didn't change anything in our life, but I when I went downstairs, I told my wife I was like yeah on the pot. I got kind of inspired and I committed to giving away 35,000 and she was like,
she's a punch you in the stomach really hard. Yeah.
She was like, what are you doing? I was like, I'm helping people and she's like help me and I was like what and she's like take out the trash and I was like, okay sorry, um, but, you know just in general it was an un it was unfamiliar territory to just like that on a whim commit amount of money. That's you know, meaningful. That's a car, you know, that's it's like something um, and I really like the feeling and every year I try to do that I try to get to giving away in a way that's meaningful to me. So the other thing we did was when Tony Robbins came on.
We pledged to give away. I think it was 40 or 50 tickets, uh, each tickets, you know, 50 to 500 to 1,000 dollars basically, um, you know, so that's another you know, sort of 25 to 50 Grand that will give but I'm like giving away an experience that was really meaningful to me that I think could help a lot of people and so um,
By the way, I need to go pick the winners for that that reminds me. So if you've been waiting you didn't miss out, I didn't pick the winners yet. There's like a thousand people to go through and I just left that pile of you know, 2,000 applications. I was like, I'll get to that when I have some free time, but I will do it. Um, but the idea is give amount that's slightly uncomfortable for you. I think that's a uh, a good practice that I'm just now doing last 3 years. I think I've done that and
and probably should have been doing it earlier to be honest. I'm not I need to do it and the reason it kind of interests me and I was like Mike is it okay to be selfish about this. He's like well, yeah, so I was like, do you get tax advantages? He's like, yeah, like it it we you could like you you can like there is some stuff I can capture but if the other reason to do it, well, he was like, it's like he's like, I'm not gonna not take advantage of something like but that's not the reason why I do it but it is it is a nice like cherry on top but I could take but I was talking to him and I was like, you know, what's crazy to me. So he's uh religious but not in a way where like we disagree on anything. Uh, like he's very kind about his shit and I was like, dude,
If you're telling me that you're put here on Earth to like please God by giving away money. I never want to bet against you. That's like the best motivation on Earth. You know what I mean? Like who who who wants to bet against that person? Uh, like I don't want to go against you you're gonna like destroy everyone you you get the best motivation. And so what's this thing on here about curse of of of uh, oh was it? It was familiar richest. I read it.
I didn't know when to break it to you that you thought I was saying family riches but it says familiar richest.
Here's the transition
you talked about giving away money. This is the greed side of it. This is about making money. Okay, so,
I have noticed a pattern in myself and in many others and I call it the curse of familiar riches.
And here's how the curse goes you grow up thinking a certain amount of money means you're rich.
For me that was always a million dollars. That's why this podcast is called my first million. I used to play games with you know, my sister whoever would be would you rather would you cut off your pinky for a million dollars would you and it was just like escalating what if scenarios? That's an easy? Yeah.
Yeah exactly.
That was a starter.
Yeah.
Um, I never even asked about 10 million dollars never thought about a billion dollars. I never even heard honestly, I never heard the word. Like I never even heard people talk about billionaires. Never knew a billionaire when I was growing up. It wasn't even on my radar as a thing. Uh, I thought a million dollars was like all the money. So you have this idea of like what a ton of money feels like but even a million dollars wasn't my goal. It's not like a million dollars was what the rich people have. That wasn't what I thought I would
have
and so I thought make him 6 figures a hundred thousand dollars was like
the goal. That was the you've made it line when I met you and you were making 6 figures. I thought you were the wealthiest person I knew.
It was a great feeling I enjoyed being the wealthiest person. You knew. Yeah. I was like 150 Grand a year.
Oh my gosh.
You have a driver.
So anyways, I I the curse of familiar richest is you have you start with this amount of money that you think is a ton of money and it is a ton of money to you at the time. It's all relative and then you get you you do it right. So I graduated from college. I think my first job. Well, my first thing was a startup and we were paying ourselves nothing. We were living off of we made 25 thousand dollars of prize money from a business plan competition. We lived off that 3 of us. So we're you know 8 Grand a year
or something
but then I got I we got kind of Apple hired. I ended up getting a job and my job was paying me 120 Grand a year and I was laughing I couldn't believe that they were paying me that much money.
And once I was making 125,000 or 12,000 my brain, this is why it's called familiar richest. My brain could think of many other ways that I could make a 120,000 I could get another job doing this. I would maybe hear about an opportunity. I could realize that I could Stitch these 2 things together. And if I did those 2 things it could be like a 125,000.
And so there are once you get to a certain level whatever that level is. It's quite easy and familiar to come up with 1 or 2 other ways that you could make that
same amount of money. And by the way that exists at every level at every level. This is a this is the problem. This is why
this is the curse and so
The easy thing to do then is when you get to 100 Grand you realize oh I can go get this other job. That would pay me 100 Grand or even 120 Grand or 150 Grand but it's basically between a 1 and 2x of where you're at. So you you can figure out how to make about what you're at 50% more or just double but your brain breaks after you say awesome. How do you make 5 times more?
Yeah,
and I remember hearing at the time like there's a guy who makes 00000 a year in salary.
And it was stunning to me.
I was like, he's stealing the money from the company. There's no way anybody could create that much value that they're making a half a million dollars per year. He just gets paid that that's insane. I and if you ask me Sean, what's the path? But you're at 120 now, how do you get to 500? My brain would short circuit and break and so what I did for many years
Was I did things that were very familiar and I found a way to 1 to 2x my earnings.
And then when we got acquired by twitch, whatever and I got my package the the here's your upfront cash and I sent it to my dad and my dad I think the most he ever made was 300 Grand in his life.
and a year a salary and um
So I sent him the offer.
And he called me and he's like, it just keeps going I go what he goes. I thought the first line was the total amount and I was so excited and that was the boat signing bonus. It's like then then the next thing he's like then they go. What is the RSU? What are these things? What are they giving you and he's he couldn't believe it. He he emailed me again that 3 days later. He goes. I just read it again. I still can't believe it and he like thought it was like a me menu where you like pick
1 of the options turns out it's more like a like a add it all up
and so and my brain broke too. So what am I getting at here, uh, after that I started to ask questions. I started to realize wow, there are people forget making 500,000 a year this people that make 2 million dollars a year this people that make 5 million dollars a year. And so I started to use as a thought exercise. How does how would I make 10 times more than I'm making today?
And at first again the brain broke there was no answer.
I sat down again the next day and I said, how do I make 10? How do how do I make 10 times more than I'm currently making?
Well, I guess if I was going to do that, I and I and then you start to get creative. You're like, is there anybody who makes that? Of course? Sorry, what do they do? How do they do it? They start to reverse engineer some things and then you add time into the equation. I remember we came on this podcast because I had a brain breaking conversation with Nikita beer. We were like Nikita. What are you up to man? You're just sitting at Facebook. You're just been 4 years you just rotting away over there. What's going on? He goes. Yeah. I'm thinking about for the summer. How do I make $10 million in 90 days?
And I was like what I never even heard. Somebody asked a question. Oh, no, it's a 10. It wasn't 10 million dollars it was how do I make what it was like a million dollars a 3 million dollars. I forgot what it was and it was a podcast about yeah. It was it was not 10. It was more like how do I make a million dollars in 90 days?
And I was like, I don't even know. I don't know. What do that time scale breaks all the existing answers I have.
But sure enough there are answers and that that summer he created the gas that app called gas and I think he made 7 million dollars in revenue and then they got a acquired by Discord.
The son of a bitch did it and I was like what the hell is that? And so I started asking myself better questions and I've just noticed this and it's just a prompt for the world. Anybody who's out there. You don't you don't have to do this. It is absolutely wonderful to be completely content with where you're at and to focus your energies on other things besides making money probably healthier and if you're doing that more power to you.
But if you're slightly broken inside like me and you don't go to therapy and you think that money is going to cure your problems.
This is a good exercise to actually do it which is to absolutely refuse any option that's going to make you 1 to 2x your money. You have to completely say no to anything that is a 1 or 2x where you're currently at.
And only think about what would be a 10x and then let your brain short circuit every day until your brain starts to come up with answers and it will it just takes like 5 to 6 days of doing that every single day to get to start generating
some answers. So I want to give 2 points to that 1 I actually think there's good news. The good news is is that you know, how they say money doesn't make you happy. Um, I actually think it does make you happier. So the good news is is there is a threshold. I don't know what that threshold is. It's different for everyone. It could be tens of millions. It could be a certain amount of your uh per year, but that 70,000 study. Uh, that's bulshit. If you zoom in on that graph, it continues going up. It just doesn't go up as Steve Steep and that study is also like 20 years old. So it's totally outdated but there is there is some number I think where it will make you happier the bad news. I know a lot of rich people you and I know a lot of the same wealthy people we know people who are billionaires. Um, we know people who are hundreds of millions millions millionaires. I am just about
100% positive and I can tell you that this is based on my personal experience. It's never enough. It is never enough you and I have a couple friends who it is enough for a very small group of people but for 8 out of 10 people, it's never enough and that whole 2x idea it always exists. And so it is a challenge but it is imperative that we it doesn't matter if you're making 100 Grand a year. It doesn't matter if you're making 500 Grand or 50 million a year that we have to figure out how to be happy and present and uh, enjoy ourselves along the way because once you just automatically get that outcome or whatever you get it it doesn't change a significant amount from like where you were the months or years prior. What's the Jim Carrey quote he goes.
I wish I wish everybody could be rich and famous. So so they know that that's not the that's not the answer. It's
absolutely not the answer it I think it can make you happier, but it doesn't necessarily make you happy. Let me tell you 1 for all the uh, Finance personal finance nerds out there what I used to do.
Is so money is kind of a weird thing because when you like sell your company or something like that, it's just like for the first few weeks. The only major change is when you log in to chase.com the number like the digit like the screen looks different like if you think about it, that's like the old that's like and that is awesome. But that's like it's kind of weird that that's like there's some weird psychological thing where that's the only like meaningful difference is that number is different people
that have come on the Pod and said they used to just go to the ATM and just click print receipt.
Like just like do a random withdrawal 10 bucks print receipt, please just so they could see the number so
I'm gonna explain how to hack that. So they told me that I heard that as well and so about 2 years before my exit I used to use this thing called personal capital.com, which basically mint.com whatever whatever you're using could work. I you can create a manual account where you can add in manually where it's not connected to your bank account. You can just added numbers I put in like 15 million dollars in the manual account. So it said that my network on paper was at least 15 million dollars. And so I saw that number
and then I sold my company and I got the money and I went and deleted the 15 million and I and then I saw like the real number and I was like
Well, I've already seen this for the last 2 years like this isn't really like that different. You know what I mean? And it did a shocking amount of stuff to my brain to like see that number leading up. And so you almost get used to it. It's very strange and it kind of ruined that like initial deposit because I was like
It's like these numbers are kind of like the same. But
by the way, I got to be the counterbalance to this because I've heard I've listened to many podcasts YouTube videos and I've heard many people say similar things that
You know money doesn't make you happy there's never enough, um, you know that day after it happened and you know, nothing really changed, you know, I just kind of felt a little I I didn't know what to do. I kind of actually almost had a little bit of a depressed period afterwards and I'm not saying that they're lying. I'm sure that's true for many people.
I had a very different experience. I had what I had exactly what I would have hoped.
It the more money. I got the happier. I got the more free time. I had the less bulshit. I had to deal with sure I had some new problems but there are way better than money problems. And then when when I saw the number in the bank account, I said fuck. Yes, and I was so excited and I had a such a great day and I took my parents to dinner that night and I was so excited and they were so excited for me and I bought a bunch of socks and those like these socks make me happy because I got a bunch of matching socks with the highest quality and the highest highest kind and then I felt amazing. I felt better and the money made me feel better. And so there are people out there bring them. This happened.
You don't don't misunderstand me. I said it makes you happier. It made me happier, but if we didn't but we still want more right we're still having conversation of how do we 2 or 3 or 5 or 10x? Because if we were truly content we wouldn't be asking that question. And so what I'm saying is we still want more and it does make you happier, but it's it in itself is not always it's not like the answer. It is potentially part of the equation, right? And I guess the thing that I'm talking
About right now is really just a question of of Leverage meaning.
For the same inputs. Can I get more outputs?
Okay, so so all I'm saying is that if you just change your brain to say, you know what I am familiar with many ways to get this amount of rich now because I've done it I know other people have done this. I've been doing this for a little while now, I am comfortable at this level.
And there's more levels that I would love to be at, you know without 10x input. Can I 10x my output? I'm always interested in that if I could get 10 times more people listening to this podcast without having to record 10 times more of a prep 10
times more. That would be awesome. You do
it, that'd be awesome. I would do that any day.
And I think even you did this when we were talking about growth for the pot. It was like here's some low-hanging fruit. And then you were like, is there anything we could do that would just get like a million views per video.
Like he's like, let's just shouldn't we just like ask that question at least in case there's an interesting answer and that's kind of what I'm saying, which is you want to ask that question because it it freeze your brain for a second and it forces you to think a little differently you may you may decide that you may never come up with a great answer or you may decide I don't want to do any of those things or I'm totally comfortable with that where I'm at, but I just think that there is a curse of familiar riches which whatever level you're at. If you're making 10 million a year, you're probably now know a bunch of ways to make 10 million a year, but you'll have very few ways to make a 100 million in a year and as a thought exercise, I think it is very valuable to say let me say no to all things that do the that are at the level. I'm familiar with and let me only think about and consider options that would 10x where I'm at.
Um and then C, then you could decide afterwards whether you want to take any action on that or not. Let me ask 1 question as we
wrap up. Yeah.
You're talking about earning. Would you spend 10x what you're spending now in order to get used to that life.
In order to get used to it.
Yeah in order like, you know, like like, um, you know, the ACT is it so I've got friends who will say like, uh, you know, this is gonna work therefore I'm gonna just behave as if it works and I'm gonna spend because I like, uh burning the boats and feeling this and I have to make
it work.
I am totally into act as if
but not by spending. That's not the I don't I think that that that perverts the spirit of act as if or living from the end. So what the way I do it is
act as if means
um to me, I'm like in decision-making meaning I'm willing to say no to doing certain things that come from a scarcity mindset. So maybe I would have said yes to some speaking gig because it gives me money. But if I had 100 million bucks, I wouldn't say yes, I wouldn't go travel leave my family go to this speaking gig and Duluth, you know, I would I would just I would just say no and so the loose so I use it in order to just put myself in a more of an of abundance mindset in order to make decisions that are more aligned with who I really want to be. Those aren't like. Let me go buy a tiger in order to increase my burn rate in order to add the pressure to me. Like I just think that's a completely unhealthy way to go about it or the other version is
How would I you know, uh, a lot of people walking around with a lot of anxiety.
A lot of stress or in a in a big rush, they rush through their day. They're constantly feeling a lack of time and they live again and the scarcity mindset lack of time, um, uh lack of ease and so the act as if that I'll try to do is put myself in a place where
What if I was what if it was all figured out? What if I knew what I was doing? What if I had already done it? What if what if you know what if x was already done and it allows me to just walk through my day with a greater sense of presence and ease and joy and less stress less anxiety less of a rush. So I'll use it in those areas. I will never use it to be like hey, how about I just like increase my burn just to see how it feels it's like, you know, it's like aren't people into like dripping hot wax on themselves before they like, you know, do do stuff like not me. I'm good don't need to do that.
And if you live in Duluth, you can kiss my ass
is dude even a place. I just said that
I had a yeah, there's the Duluth in Minnesota, but there's probably a Duluth in a lot of places.
Shout out to The Listener who just caught it absolute stray and dilute you're looking.
Yeah.
If you live in Duluth just comment in the YouTube and let us know but you could still kiss our ass. Um, all right, that's odd. I feel like I can rule the world. I know I could be what I want to I put my all in it like no days off on the road Let's Travel never looking back.
