MFM Demo Day: 5 Startups Pitch Sam & Shaan and Raise $1.7M

Sam Parr (@TheSamParr) and Shaan Puri (@ShaanVP) with the help of Stonks.com , listen to five entrepreneurs pitch their business in hopes of getting Shaan and Sam to invest. ----- Links: * 5x * Bacarai * Munch * Nicklpass * Lil'Duckies Pool Co. * If you would like to invest in any of these companies, go here: https://stonks.com/my-first-million/demo-day/invest * If you want to watch this show on YouTube go here: https://www.youtube.com/watch?v=bu3v7lE9gYI * Do you love MFM and want to see Sam and Shaan's smiling faces? Subscribe to our Youtube channel. * Want more insights like MFM? Check out Shaan's newsletter. ------ Show Notes: (03:18) - Tarush Aggarwal (5X) (17:55) - Kenny Totten (Bacarai) (32:50) - Oren (Munch) (50:15) - Zaza and Allison Paz (Nicklpass) (01:11:25) - Colton Woodard (Lil'Duckies Pool Co.) (01:29:35) - Ali Moiz (Founder Stonks.com) ------ Past guests on My First Million include Rob Dyrdek, Hasan Minhaj, Balaji Srinivasan, Jake Paul, Dr. Andrew Huberman, Gary Vee, Lance Armstrong, Sophia Amoruso, Ariel Helwani, Ramit Sethi, Stanley Druckenmiller, Peter Diamandis, Dharmesh Shah, Brian Halligan, Marc Lore, Jason Calacanis, Andrew Wilkinson, Julian Shapiro, Kat Cole, Codie Sanchez, Nader Al-Naji, Steph Smith, Trung Phan, Nick Huber, Anthony Pompliano, Ben Askren, Ramon Van Meer, Brianne Kimmel, Andrew Gazdecki, Scott Belsky, Moiz Ali, Dan Held, Elaine Zelby, Michael Saylor, Ryan Begelman, Jack Butcher, Reed Duchscher, Tai Lopez, Harley Finkelstein, Alexa von Tobel, Noah Kagan, Nick Bare, Greg Isenberg, James Altucher, Randy Hetrick and more. ----- Additional episodes you might enjoy: • #224 Rob Dyrdek - How Tracking Every Second of His Life Took Rob Drydek from 0 to $405M in Exits • #209 Gary Vaynerchuk - Why NFTS Are the Future • #178 Balaji Srinivasan - Balaji on How to Fix the Media, Cloud Cities & Crypto * #169 - How One Man Started 5, Billion Dollar Companies, Dan Gilbert's Empire, & Talking With Warren Buffett • ​​​​#218 - Why You Should Take a Think Week Like Bill Gates • Dave Portnoy vs The World, Extreme Body Monitoring, The Future of Apparel Retail, "How Much is Anthony Pompliano Worth?", and More • How Mr Beast Got 100M Views in Less Than 4 Days, The $25M Chrome Extension, and More

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:06Sam Parr?

  So here's the, here's the, here's the situation. So this is recording. So this is going to go live on our podcast feed. So the people listening on the podcast, there's you and then there's people who are live right now. I think over a thousand people live. So we're on this thing called stonks.com. I guess I gotta, I gotta, gotta do a disclosure. I'm an investor. Sean, are you an investor?

• 0:25Shaan Puri?

  No, but a fan.

• 0:27Sam Parr?

  Fan. So stonks.com, it's they, we were friends with them. They asked us to do this. And it was actually, we say no to everything, but this was a cool idea. So basically five startups are going to pitch us and we're gonna maybe invest, but very likely tear them apart and also compliment them. We're gonna make like some good content out of this, right?

• 0:47Shaan Puri?

  Yeah. Uh, yeah. Okay. Great. I'm down. And we don't know much about these startups ahead of time. So it's all going to be kind of fresh.

• 0:55Sam Parr?

  And there's a comment section. Do you see the comment section, Sean?

• 0:59Shaan Puri?

  Like where people are chatting?

• 1:00Sam Parr?

  Yeah. So like if there's any good questions and also on the stock.

• 1:03Shaan Puri?

  They can invest, right? Like they can put in money.

• 1:05Sam Parr?

  Yeah. So like if they see something, I don't think they can like, they're not literally going to fund the company right there, but they're going to say like, I'm interested. Let's talk. And honestly, that's probably what I'm going to do. I'd never like on these things, I cannot, like I've seen these things and someone's like, I'm in for a hundred thousand dollars. And they say they're like right on the spot. I'm not that impulsive. Are you?

• 1:24Shaan Puri?

  Yeah, I'm that impulsive. And it's also more dramatic. So I'm a sucker for the drama. I'll do it.

• 1:29Sam Parr?

  All right. Well, at least one of us will. Um, and then do you, if you go to the chat of this video thing, you'll see the order of, of people that they're going to go and we're going to talk to one person. I think they get two minutes and then we get eight minutes to talk to them. And then it's going to say like, time's up, move to the next one. Does that make sense?

• 1:48Shaan Puri?

  This is pretty sick. Let's do this.

• 1:50Sam Parr?

  All right. Uh, we have John Hancock, uh, from stocks is like our assistant here. He's going to be feeding us startups. So John, do you want to bring the first one up?

• 1:59Shaan Puri?

  John, is that a real name?

• 2:01Sam Parr?

  I don't think so.

• 2:02Speaker 02

  Hey guys.

• 2:03Shaan Puri?

  What's up, Tarush?

• 2:05Speaker 02

  How's it going? Thank you so much for the time.

• 2:08Shaan Puri?

  Okay, take it away.

• 2:10Speaker 02

  Awesome. My name's Tarish. I'm the founder and CEO of 5X. Been fortunate enough to spend my career in the data space. From being the first data engineer at Salesforce to most recently running data for WeWork, supporting thousands of employees. Over the last three years, been super interested in the modern data stack. It's estimated that over 77% of companies in the next 10 years in some way, shape or form are going to use the modern data stack. The problem is that there's a big disconnect in what vendors are selling today and what customers need. Over 90% of customers are investing in data to get a business ROI. Yet, the vendors are really focused on selling individual categories. What this means is that customers have to have expertise. They need to sign multiple contracts. They need to stitch this together. All of this is taking away from actually getting business output.

• 2:54Speaker 02

  5X is the first end-to-end data platform which is focused on business output. So, we license and integrate with the different vendors in the space. And as an end result, we can provide customers with an end-to-end platform depending on their use cases, industry size, budget. On top of this, we also have a services model where we can give companies access to high quality engineers who are pre-trained on this stack. Today, we interview hundreds of engineers fully automated and we get to hire the top 0.1%. End result, customers can implement end-to-end data strategies in weeks instead of spending time signing all these contracts. For less than a year old, million dollar run rate on a POC with zero marketing. And we're super excited that we are going to be profitable by the end of this month.

• 3:39Shaan Puri?

  All right. Good stuff. Sam, so what does this business do?

• 3:46Sam Parr?

  That's what I'm trying to... I was trying to interrupt you earlier, but I think I was muted. Can you kind of dumb this down for me for a little bit? I'm looking at you. So, let me, for the listeners, all right. So, the website is 5X.co. Right now, you are raising $300,000 at a $25 million valuation. You got to $1 million in ARR in less than a year. I don't know what POC means. When I see POC, I...

• 4:14Shaan Puri?

  People of color.

• 4:15Sam Parr?

  That's what I thought about it. Point of contact. Okay. So, like, some companies are telling you that they're going to pay you up to $1 million, right? Or collectively? Or they actually have?

• 4:26Speaker 02

  They actually are paying us monthly.

• 4:29Sam Parr?

  Dude, you got a million dollars and a proof of concept? That sounds pretty sick to me. Okay, but I'm gonna be honest, I don't know what the hell you do. Can you explain to me? I've never worked at a big company before, so I'm kind of like a big dumb idiot.

• 4:42Speaker 02

  It's not just for big companies. Think of, you know, if you want to get value from data, fundamentally, you need two things. You need infrastructure, you need tools, infrastructure. You might have heard of Tableau or Snowflake. And the second thing you need is people. Now, the way the infrastructure is working today is every vendor is really focused on one small part of the stack. So if you want to do something like analytics, you need to go sign four or five different vendors, sign these upfront contracts and stitch this together yourself. Now, if an industry is going to become mainstream, then you can't really expect 90% of customers who don't care about...

• 5:16Sam Parr?

  When you say words like vendors, it's still hard for me to understand. Give me a very specific example.

• 5:20Shaan Puri?

  Use this format. Yeah, use a format that's like, X company had Y problem. They tried Z, but the problem with Z is this. So then we came in and we do it differently instead.

• 5:34Speaker 02

  Sure, so X company, you know, wants to figure out where the customers are coming from.

• 5:39Sam Parr?

  Name, name, yeah. Sorry, that was confusing.

• 5:42Speaker 02

  We use one of our customers, Bank Novo, wants to figure out where the customers are coming from. How do they personalize their app? How do they save costs and, you know, optimize their sort of cash flow? They now don't know where to go. They can go buy a single reporting tool like Tableau, but the end-to-end data strategy is a lot more comprehensive. There's a lot more than just having a dashboarding tool. Instead of having to hire multiple engineers, instead of having to go sign all of these different tools and vendors, they come to 5X. 5X instantly gives them an end-to-end platform, which has got all of these vendors. We license these vendors and can give customers an end-to-end platform.

• 6:22Speaker 02

  On top of this, if Bank Novo doesn't have the resources to figure out how to go use it, they can add engineers on our side who are pre-trained on the platform. End result, they're getting business output in weeks, whereas if they tried to go do this themselves, it would be 12 times slower and six times more expensive.

• 6:43Sam Parr?

  All right, that's way better. And one question, how on earth did you get people to spend a million dollars with you on a proof of concept? Because this sounds like a very hard thing to sell and a million dollars is a lot of money. And is it actually like they're going to pay you a certain amount of money every single year?

• 7:00Speaker 02

  Yeah, so you know, at the moment, we know, we, so in the next two months, our self-service platform will be live, right? So anyone will be able to go to 5X, enter their credit card for a few hundred bucks a month, you'll have the, you'll have the, you'll have the platform. So early-stage companies can do this by spending very little money. What we do today, because the self-service platform isn't ready, we combine the semi-automated platform plus a services model. So you get engineers plus you get, plus you get the platform. So our average order value at this point is about 10K a month. Multiply that by about 10, 15 customers, we're at a million dollar plus run rate.

• 7:42Sam Parr?

  Which basically means you're doing it by hand from now and then you're raising money so you can automate it all?

• 7:48Speaker 02

  Correct. It's semi-automated already. It would take a consultant about three or four months just to give you that platform. They would go build it and they would start from scratch. We do it in less than one day today. Semi-automated.

• 8:01Shaan Puri?

  And where are these customers coming from? So let's dig into this 1 million of ARR. So you said you got 10K per customer, roughly 10, 15K, and roughly 10 customers that are paying you monthly right now. So you got 100K a month, you know, roughly, roughly in revenue. Where do these customers come from? Is this inbound, outbound? Do you have a growth strategy? Like, do you have a strategy that would just lead you to the next 3 million also?

• 8:26Speaker 02

  Sure. At the moment, we've done zero marketing. We've been really been focused on, on the platform. We have been producing content on my LinkedIn, on YouTube, mainly getting customers by word of mouth and by that. So really, the last eight months were really on using this as a proof of, using this as a proof of concept. This is not just a technology problem. You have to convince all of the vendors in the space to give you API access to provision them, integrate with them, bill for them. So, you know, you need, it's a little bit of a chicken and an egg problem where you need customers. And at the same time, you need to show these vendors that you, that you, they actually is traction and we become an added sales channel for them.

• 9:08Sam Parr?

  Okay, I, uh, what else, Sean?

• 9:13Shaan Puri?

  Uh, I guess I'll just give you a little bit of feedback on the pitch itself. So, um, a couple of things. Your house or wherever you're at, super nice, um, almost distractingly nice. I kind of like my founders to be a little more scrappy than that. Just gonna put that out there.

• 9:26Sam Parr?

  Where are you? I'm in Bali. Ah, he's in Bali, man. It's probably, it's probably not, not the most expensive place.

• 9:34Shaan Puri?

  Yeah, yeah, fair enough. Uh, second thing, um, you know, I think you wanna, I think you tried to get the most information into the pitch, whereas I think you want, kind of want to slow down and you need to just like work on that first 30 seconds to be, uh, figure out the thing that I was confused about, Sam was confused about, most of the chat, if you look on Stonks was confused about, which was, I don't really know what this does, right? When you say end to end, that makes sense to you because you're knee deep in it, but for us, we've never heard of 5X before. So we're like end to end what? And, you know, all of the, all of the words were quite, um, you know, generic. So like, you know, vendors, blah, blah, blah. And, uh, and so you, what you want to do is basically

• 10:14Shaan Puri?

  just be able to, to paint a picture. So, you know, did you ever work at a company that had this problem? Or if you've ever been the marketing manager to company, you know that you spend almost, you know, six months getting your analytics platform and then integrating it. And then you have to get your CRM and then integrate it. Then you have to do this and then integrate it. And so it takes months just to get set up with the things you need to be able to see your business. And every business has the same problem. So what we do is we go to that person and we say, hey, use us and you get XYZ, right? Benefits out of this. And people are choosing it because of this. We got a million dollars in, uh, in ARR already as a, you know, during our pilot, just, you know, in a couple of weeks or whatever it is. Now I'm kind of more engaged.

• 10:55Sam Parr?

  What else? Here, and look, this is actually quite easy. What year did you join WeWork? Someone in the chat said, this guy made a bunch of money off the WeWork IPO. And then I just went to your website and it said you worked at WeWork. So I don't, I don't know what the truth is. I joined in, I think.

• 11:12Speaker 02

  For 2017, I did not make money off the IPO.

• 11:16Sam Parr?

  That's okay. That's irrelevant. I mean, that would have been sick if you were. It looks like you did it because you're in that nice house. But I guess what I was trying to get at is I would do exactly what Sean said, but I would use the WeWork story. So we were at, when I, when I worked at WeWork, because you were the head of data, it looked like at WeWork or something like, like some like pretty, you led data for WeWork, your bio says, that's, sounds impressive. It doesn't matter if it is, but it sounds like it. And so I would use the story of like, I led data at WeWork when we were this size and I grew the company to this size. And a problem that we consistently had was blank, blank, blank. And we solved it by hiring tons of people and it was still like riddled with errors.

• 11:58Sam Parr?

  And, and talking to other people in this data world, I noticed they all had the same problem. And so to bootstrap this company and get it off the ground, I hired a couple of friends and we actually have been doing this by hand. And we convinced X, Y, and Z to give us some money and slowly or quickly, we've actually automated a lot of it. And we've automated by doing X, Y, and Z. So now all these companies who want to get this thing done, they can actually use us and instead of hiring 30 people, they just use, have one person use this bit of software. And it saves them X amount of money and X amount of time. You know what I mean? Like I, by the way, I'm just totally riffing. I don't know any of this is true.

• 12:36Shaan Puri?

  No, that was great.

• 12:37Sam Parr?

  But you know what I mean?

• 12:38Speaker 02

  Yeah, totally.

• 12:40Sam Parr?

  But now, if we should just get to the product, I think it sounds neat and it looks like my good friend Anker invested and he's actually quite,

• 12:50Sam Parr?

  he's actually quite impressive as it knows his shit. I think it's a cool company.

• 12:54Shaan Puri?

  Yeah, I would, I would definitely, just based off your traction alone, I would want to learn more because I'm like, okay. You know, a good pitch is not necessarily a good business, but good traction is usually a good business. And so you actually have good traction at a bad pitch. That's okay. So I would want to learn more and, and dig into understand how much of this is a service and consulting business versus, is this going to be software and this is going to be automated? Because it sounds like you've actually found a problem that people care about. We'll see how, how kind of durable that is and then we can go from there. So, thanks for coming on, man. I think, you know, for both of us, it seems like the answer is like, we'd actually want to learn a little bit more and look at the deck before we, we go too far.

• 13:35Speaker 02

  Amazing. Thank you.

• 13:36Sam Parr?

  You're awesome. Thanks for being brave and doing this.

• 13:42Sam Parr?

  So Sean, he, um, so on the stocks platform, it says he's got $75,000 of interest. I do agree this potentially is more of a services play. Um, but we actually just talked about that company Worldwide Technology and this sounds just like it, doesn't it?

• 13:56Shaan Puri?

  Yeah, there's, there's several companies that are like this. Uh, there's a lot of, a lot of SaaS companies that have like, like a, either a consulting thing. That's how they get it embedded or it's like just an ongoing revenue stream and it actually can get quite substantial. So I don't think that's a completely, um,

• 14:12Sam Parr?

  No, I didn't, I didn't mean that. I, I didn't mean that as a diss.

• 14:15Shaan Puri?

  I kinda said it as like, ah, is this is just this consulting company? Cause if it was just a consulting company, I would not do it. But, um, but yeah, I was just so confused for half the time. I didn't really get to think about, uh, didn't really get to think about the business, to be honest. I was trying to figure out what the heck it does.

• 14:30Sam Parr?

  Yeah, that was a little bit of an error. Hopefully he'll fix that, but, uh, this type of business, I think it'd be sick to own. I don't know if you, if, I don't know why you'd want to raise money if you got a million dollars and, and just selling.

• 14:43Shaan Puri?

  By the way, the simple test here is, uh, like just say the first like 30 to 60 seconds of your pitch to somebody. And then be like, uh, to a friend and just be like, um, hey, can you play that back to me? Like, so based on what I said, what does my company do? Like, and what you want to know is do they get it? First of all, like you have to get it and then are you interested in it? Does it sound compelling? And if it's like, if you don't get it and it's not compelling, like don't move forward. Don't go to the rest of the pitch and you need a friend or you need like random people who are going to do that. And the format you use was good because you, you sort of like added the team and credibility. It's well, when I was leading data for WeWork,

• 15:18Sam Parr?

  Right.

• 15:18Shaan Puri?

  You know, uh, all the shenanigans were going on, but in my little corner of the world, we actually had this much, you know, this big problem that we had to deal with. And, uh, that's where I kind of realized that every company has this issue that blank, blank, blank. And it's like, oh yeah, that's a good format generically for a pitch.

• 15:35Sam Parr?

  Yeah, I agree. Um, all right, uh, John Hancock, you want to send us the next one?

• 15:41Sam Parr?

  All right.

• 15:42Speaker 03

  All right, Kenny, you got it. Hey, guys. Thanks for having me on the show. So I am Kenny. I'm one of the co-founders of Backer Eye, and we've built the world's first online marketplace for group airfare. And the problem that we set out to solve is that group airfare, flights of 10 or more people traveling together, it's sold offline. So what does this mean? Say that you are a, you're organizing an eighth grade school trip, and you're flying 50 people from San Francisco to Orlando. If you want to shop for quotes, you actually have to call the airline's group desk over the phone. And once you get something that you like, well, the offline nature of groups doesn't end there. It's really important to note that group airfare is unlike booking a normal ticket.

• 16:26Speaker 03

  So it actually takes place in five unique stages, and that's from shopping to deposit to final payment, submitting names list. And before Backer Eye, all of that happened over the phone. So we thought in 2022, this is insane, that a world with so much money in it operates totally offline. So we created what's like a B2B Expedia-like marketplace for shopping for flights of 10 or more people. In terms of traction, we did launch Backer Eye in October of 2021. We have really strong growth, great unit economics, and we're actually profitable. As a business model, we make between 10 and 15% margin on flights.

• 17:11Speaker 03

  And from January to April, we've done $4.2 million worth of total sales. We take about $1,700 in revenue per group and have 40 corporate customers that are using the platform today. And one of the most exciting things that happened as a result of the pandemic is we got a ton of inbound from corporate meeting and team offsites that are looking to book group airfare. It's our fastest-growing customer segment, and it's caused us to build out a bunch of tools to meet the needs of meeting planners. And you're probably asking, why is this the team to bring group airfare from analog to

• 17:50Speaker 03

  digital? Well, we have really deep domain expertise in group travel. Our CEO Eric previously sold a tour operator business where he kind of learned the ropes of the business. And then our team internally, from the service side to the tech side, we have a lot of deep expertise in travel tech. And we think that we have a shot to be both the storefront and the underlying operating system for group airfare. So we'd love to answer any questions that you have about our business.

• 18:19Sam Parr?

  Are we live? Can you hear us? Dude, the top comment is actually pretty funny, which is says, fly together and groupflights.com is available.

• 18:31Shaan Puri?

  Go buy the domain.

• 18:32Sam Parr?

  Go buy the domain.

• 18:33Speaker 03

  Get on that one.

• 18:36Shaan Puri?

  You got the stocks chat adding some value here. They're the real value add investor. I love this. Also, I like how you just like looked at us and he's like, Ma, go buy the domain. Ma, the meatloaf. Yeah, I thought you were like a Chinese gambling website when you, when you first came on. I thought this is Baccarat.

• 18:56Speaker 03

  Well, based on your last podcast, that wouldn't be a bad idea, too. Australian business is crazy.

• 19:02Shaan Puri?

  Fair enough.

• 19:05Sam Parr?

  Let me ask a clarifying question on the pitch. You said that you get 10 to 15%. And I think your chart said, did your chart say a hundred thousand a month in bookings? Or did it, I forget what you're, but you said 4 million.

• 19:19Shaan Puri?

  Can you pull up the traction slide again?

• 19:21Sam Parr?

  Yeah, it was like 4 million between January and April. Does that mean that between January, January and April, you did 4 million?

• 19:30Speaker 03

  Yeah.

• 19:31Shaan Puri?

  That's GMV, correct?

• 19:33Speaker 03

  We did, yeah, exactly. So we've sold $4.2 million worth of group airfare and we're averaging about $150,000 a month in revenue.

• 19:43Sam Parr?

  And that's the revenue that like, it's real revenue?

• 19:46Speaker 03

  Yeah. And how old's the business? So we started in 2018, survived the pandemic just barely. And then probably like half of our clients kind of didn't make the pandemic. So it's kind of like a fresh restart for us. Prior to us launching Flight Shopping, we were just a trip management platform for tour operators. So like if someone did like a lot of student travel, sending people to like DC and Orlando, they would use our trip management platform, just a way to stay organized and make sure that they don't miss deposits and final balances. And then we had a lot of time to ourselves during the pandemic. So we made Flight Shopping because it was our number one request. People don't want to call the airlines for quotes. And then how many people work there? We have 11 now. Cool, got it, okay.

• 20:32Shaan Puri?

  Okay, so maybe in each of these, Sam, we do like, first I kind of like clarifying questions slash like reaction to the business and then maybe some pitch feedback at the end of like how to get that better. But like, okay, so reactions to the business and clarifying questions. So you are trying to do group travel for corporate. And you said something at the beginning, which was like, it's insane that there isn't really a good solution for something with this much money in it. I didn't catch, did you say how much is spent booking group travel every year?

• 21:03Speaker 03

  Yeah, so I didn't. It's about $130 billion worth of just total group spend. And that equates to about 5% of an airline's revenue. So floating around about 225 million passengers fly as part of a group pre-pandemic.

• 21:21Shaan Puri?

  Okay, cool. So 5% of airline revenue is done via these groups? And that's all kind of the over the phone or some like some other old school method at the current, currently?

• 21:32Speaker 03

  Exactly, yep.

• 21:33Shaan Puri?

  Okay, cool. And then what's the why now? Because people have been doing like travel startups forever, like, you know, booking.com, price sign. These were, I think booking.com, price sign came out like in 1995 or something crazy like that.

• 21:45Speaker 03

  Yeah.

• 21:45Shaan Puri?

  And so why has nobody tackled this part of it? Because I've seen Travel startups in every angle, but what is there anything that's unlocked now? Or you're just, you finally have the great idea? What's going on here?

• 21:58Speaker 03

  No, so not finally have the great idea. We do have some people that are competitors that sell a SaaS solution to airlines that allow airlines to make like a white label version of what of what of what we do. The why now is before the pandemic, Lufthansa, American Airlines, United is rumored to be working on it. They want to go digital for their groups and they've actually instituted a private white label. And so we see it happening in the same way that like single tickets came online. We think groups will come online. So the airlines are already starting to do the underlying tech and we think that's amazing. And we want to be basically that that second shelf that they sell their, their, their group airfare in.

• 22:45Sam Parr?

  How are you getting the customers now? Cause isn't travel like the hardest? Like, uh, when I think of like hardcore customer acquisition people, I think of like online gambling. I think of gaming and then like travel.

• 22:59Speaker 03

  Yeah.

• 23:00Sam Parr?

  Like, that seems like the most cut, one of the most cutthroat industries to get customers. Cause I think, um, the guys who started Reddit started HitMunk and, uh, it didn't work out because they just like couldn't get like, or, you know, it wasn't as big, nearly as big as Reddit. Uh, how, how are you getting those customers?

• 23:17Speaker 03

  Yeah, so currently right now, about 99% of our business is B2B. So we get customers really in two core ways. Uh, one, we have a referral pro, a referral program. So we are a, we're a preferred partner for like meeting planners and tour operators in the student travel space. And if you refer us business, we give you like $5 per, uh, per, per ticket book. That has been enough to send us so much business that we have to like hire and raise money. Uh, then the second way is kind of old school, like industry events are still really popular, just meeting with meeting planners and tour operators. Uh, and then something that we'll try to get better with, um, in time is like SEO.

• 24:00Speaker 03

  There is not a lot of, of competition for like the keywords group airfare. Before the pandemic, we got it down to like 72 cents a click. But admittedly, since we just survived, I mean, to have the capital to run a bunch of marketing experiments, uh, we're not doing any paid at the moment.

• 24:15Shaan Puri?

  And then until now, you got a bunch of savages in the chat that are all going to start bidding you up.

• 24:21Shaan Puri?

  They already bought the domain fly together before you could get it. So explain, what are the terms of the raise? So you're raising how much at what valuation?

• 24:28Speaker 03

  Yeah, so we would like to raise $1.5 million at a $15 million cap.

• 24:35Shaan Puri?

  Great. And so for somebody listening to the podcast, there's people who listen to podcasts that don't, they're not part of like the angel investing scene. How does a couple, are you just $15 million? Wait, but you said you're doing 150,000 a month in revenue. So is it some revenue multiple? Just explain, where's this 15 million magic number come from for you?

• 24:52Speaker 03

  Yeah, so we have our customers book pretty far out. So like our average customer books nine, nine months out. So through the end of the year, we should make about 1.5, 1.6 million dollars in revenue. And so we just took that top line number and times it by 10 to kind of be safe. Now, there's been crazy stuff happening, but we want to be set up for success and fair. So we just times it by 10.

• 25:15Shaan Puri?

  And then what is the like, what's actually happening under the hood? So you didn't show like a demo or search engine or how somebody actually does this. Is there, are there APIs? Are you just like calling the airline yourself under the hood? Like what's, what's actually happening?

• 25:27Speaker 03

  Yeah, so under the hood, we are connected with two, are you familiar with like travel technology?

• 25:33Shaan Puri?

  No.

• 25:34Speaker 03

  Okay, so really high level, I know that we're, time is running out. So we're connected to two GDSs called Sabre and Amadeus. That's how we get the flight content. And then we had to build some stuff on top to make sure that groups work because there's limitations of the legacy system. But I think our time is up and that could be a whole podcast.

• 25:52Sam Parr?

  Let me ask one, let me ask one more question. This is something that I love asking everyone that I invest in, which is like five, 10, 15 years down the line. How does this, how big, how much revenue are you going to be making and how am I going to get my money back?

• 26:04Speaker 03

  Yeah, I think that we can be both the store, the storefront and the underlying pipes for groups. So if you were thinking about getting like a ride, you would open the Uber app. If you were thinking about booking flights of 10 or more, I think that you come to backright.com.

• 26:21Sam Parr?

  But how do I, so how big do you think the business will get? And what's going to happen? Someone's going to buy you for a billion dollars? Someone's going to buy you for a hundred million dollars? You're going to go public? What do you think will happen?

• 26:29Speaker 03

  Yeah. There's a, there's a really, a really clear path for us that we get to like $50 million in revenue in the next like five to six years. And beyond that, I'm not totally sure, but I, the path to 50 is pretty clear.

• 26:43Sam Parr?

  That's a good answer. Okay.

• 26:44Shaan Puri?

  Yeah, that's a great answer. In general, fantastic pitch, actually. The thing I was saying before, got to be clear, got to be compelling in the first minute. You were extremely clear, extremely compelling. I think it's pretty clear you know your stuff. As you were asked questions about it, you had good, honest answers. You didn't oversell, but you, you got to the point on, on, on each one of those questions. So I think really strong, really strong pitch as far as I'm concerned.

• 27:09Sam Parr?

  Yeah, I would, I would, I would love to learn more.

• 27:14Shaan Puri?

  Awesome.

• 27:15Sam Parr?

  That was a good one. And it was very, it was very, very, very, very clear. One thing that wasn't clear, which is like, how big is this? I mean, I don't know anything about group flights. And it turns out, so he said it's, it's a hundred billion dollars worth of tickets booked a year as group flight? Is that what he said?

• 27:32Shaan Puri?

  Hundred thirty billion of group spend, which is 5% of all airline revenue is what he said.

• 27:36Sam Parr?

  Yeah, he buried the lead on that one a little bit.

• 27:38Shaan Puri?

  Yeah, exactly. So like, you know, that question we asked, that's got to go to the front of his presentation, which is like,

• 27:45Shaan Puri?

  you know, booking group travel sucks. And by the way, this sounds like it might just be this fringe thing, but there's over 130 billion a year going through group, group, group travel. And today that's all done still on the phone, which is crazy because most of all other ticketing, 90, other, 80% of the other ticketing is just done online now. That's going to happen for group travel and we're going to make it happen, right?

• 28:05Sam Parr?

  I would have been like, all right, so group travel is defined as 10 or more tickets. Guess how much revenue is booked per year during that?

• 28:12Shaan Puri?

  Yeah, guess how much revenue is, is a nice one. A, confidence, B, makes the other person insecure. C, they're almost always going to guess wrong when you have a really high number. Because they just don't have right, the right frame of.

• 28:22Sam Parr?

  And you say 128 billion, that's 5% of all tickets are booked that way. And guess how they book it? They have to call the airline and book it all like manually. It's a pain in the butt. Like, that's how I would have done it. But he did, he did really good.

• 28:35Shaan Puri?

  And I would put a screenshot of the website. Be like, this is a, you know, if I go to like, whatever, Delta, or I go to Expedia, like, look, all the, there's a million buttons on the screen. There's not one. If you want to find the group button, go to help, go to phone up. This is where you go for that. This is where 130 billion flows through, right? Like, I really emphasized that problem. And then I'd show my screen, which is like a Google search engine. That's like, here's how it works on Fly Together. You just go here, you just say how many people, where you're going, and then we take care of the rest. We do a bunch of crazy stuff under the hood to make that automated. And it's working. We have, you know, we've done 4 million in bookings so far. That translated into $150,000 a month of revenue for us. So we're on a X million, you know, $2 million run rate.

• 29:19Shaan Puri?

  And by the end of the year, blah, blah, blah.

• 29:21Sam Parr?

  Dude, I agree with everything that, one thing that, what it bothered, there's two things that when startups, when I'm talking to them, that bothers me. One is when they use ARR, and it's not actually annually recurring revenue. And they're like, well, it means annual run rate. I'm like, dog, come on. You know, like, none of us like, use that word that way. And the second thing is when they say revenue, but it's GMV, which stands for, I didn't, gross.

• 29:45Shaan Puri?

  Merchandise volume.

• 29:46Sam Parr?

  So it's like, if you're eBay, you sell technically like, let's say 100 billion worth of stuff, but eBay only captures 5% of that. You know, I'm making that up. But like, I, I need, it's so confusing to me when they say that.

• 29:57Shaan Puri?

  I, I wrote this note during the thing, right? Like, I have this little whiteboard here I'm writing on. I wrote, "Revenue presented weirdly." Because he wrote 4.2 million in sales, but it was like, that's an aggregate over five months. Then he wrote, like, "We take 1.7 per customer." It's like, dude, just say how much revenue you have. Like, make that the first one. We do this much per month or per year. That's our current run rate. That's, that's not GMV, that's what we take home. In terms of GMV, we've done this much, right? Like, that would be a big improvement over, uh, over the traction side, but.

• 30:27Sam Parr?

  Very, very cool company, though. You want to do another one, Mr. Hancock? Where you at?

• 30:33Speaker 04

  Hello. What's up? All good.

• 30:38Speaker 04

  And thanks for doing that, it's actually pretty fascinating. So, my name is Orin, I'm the co-founder and CEO of Munch, and I'm accompanied by Peter, my co-founder and CTO. We both have some... I have too many years of experience in business and tech leadership roles, and we've been building Munch for the past few months, getting out of the validation phase and into our MVP and initial traction. So, what is Munch? Think about your favorite YouTuber, apart from yourselves. Let's say this person has 1 million subscribers on YouTube. Now, what if I tell you that chances are that this person has almost all

• 31:22Speaker 04

  of other content professionals has only 1 to 2 successful distribution platforms? I mean, this is mostly the case in almost all cases. This is because it takes a lot of time, money, professional know-how to succeed on each and every social platform. It's actually pretty different to be successful on TikTok or Facebook or Instagram or YouTube, totally different platforms and different audiences. Due to that, most of them don't even try to put in that effort and kind of give up, even though it can grow their revenue streams and their monetization potential in quite reasonable numbers.

• 32:05Speaker 04

  So, we are a team of builders, dreamers and content creators on a mission to build the first platform that we serve as a home for content professionals. There are no other platforms currently serving as a home, as a place that a content professional can do everything, from creating their new content based on data-driven processes, repurposing the content for different types of platforms, doing research on what's the next content they want to create and actually distribute it on all platforms and monetize. The current creation market is currently estimated at around $65 billion with an annual growth rate of 15%. This means that it will get to $140 billion by 2026.

• 32:49Speaker 04

  And combined with the creator economy, we're talking about $200 billion market. It's a rather big market. And we are currently raising $500,000 on top of the $900,000 that we already raised. We have $250,000 already committed and we're looking for 250 more. The idea is to take this money and use it to boost our dev team and create the first version of the product by this November, increase attraction and start testing different pricing levels with their initial paying customers. So we're looking for some new partners that can actually teach us a bit more about the media business.

• 33:30Sam Parr?

  First of all, let me say, the people who are not English speaking in pitch, fucking awesome. That would, I cannot imagine how hard that-

• 33:42Speaker 04

  It's not easy. It's not easy.

• 33:44Sam Parr?

  I could tell it wasn't easy. You did pretty good, but golly, that seems like a rough thing to have to learn how to do. Congratulations.

• 33:52Shaan Puri?

  We can barely speak when it's our native language, so, you know, respect for that. Okay, now I could be mean. That was a horrible pitch, though. I respect the attempt, but the actual structure of the pitch was just not great. And like, you know, in the chat here on Stonks, on a scale of 1 to 10, 10 being that was super clear and compelling, 1 being as cloudy and not compelling, give it a score, 1 to 10. I'm curious what it was for you guys. 1 being low, not clear and compelling, 10 being very, very clear and compelling. Type it in the chat.

• 34:28Sam Parr?

  And they're on like a, they're on like a 15 second delay, by the way.

• 34:33Shaan Puri?

  So let's see what comes through.

• 34:35Sam Parr?

  It's gonna start coming in.

• 34:37Shaan Puri?

  So I'm seeing an eight and then two, two, three, two, one, three, one, two, one, two, one, one, one. Okay. So your job, Orin, is to get that two into an eight, right? Because like right now, I can barely even give you kind of feedback on the business itself. Like I went to your website, I went to getmunch.com and it looks like basically what you're doing is a creator spends a ton of time, let's say, making a video or a long form post. They're kind of drained by the end of that. And, um, and so they posted on the one platform, they posted on YouTube. You take that content, you turn it into clips, you put it on TikTok, you take that content, you turn it into tweets. You, you basically repurpose the content, chop it up and repurpose it so they can get more juice out of the content they made. Is that right?

• 35:18Speaker 04

  This is the penetration product. This is what we currently do, currently have online. We can, actually, if you want to see an example, um, I allowed myself to take one of your episodes. Do you like to see that? Can you see that?

• 35:32Shaan Puri?

  Yeah, yeah.

• 35:34Speaker 04

  Okay, so, um, let's take, for example, this episode. Okay, it was from April 6th. I kind of played around with it. And what you have here is our system choosing between three to five, the most engaging parts of the original video. And what do you mean by engaging? We do analysis both on scenes and visuals and any different types of audio effects, as well as analyze with, using AI, the actual spoken words in the, in the video, in order to understand what would be the best clips that can fit into, let's say, a one minute TikTok or a three minutes TikTok or one minute Instagram reel.

• 36:14Speaker 04

  So the idea is that you, as a creator, can get your original video chopped up into, like you said, into a few clips and then turn from landscape to portrait, so we can publish it directly to the other, uh, to the other platform.

• 36:28Shaan Puri?

  So this is.

• 36:30Sam Parr?

  Go ahead.

• 36:30Speaker 04

  Yeah.

• 36:31Speaker 05

  I am human optimization.

• 36:35Sam Parr?

  Sean, have you ever heard of Jelly Smack? I'm shocked, Orin, you didn't talk about them. You've heard of Jelly Smack, right?

• 36:41Speaker 04

  I was waiting for you to raise the name. Yeah. We heard about Jelly Smack. Actually, we love Jelly Smack. We love what they're doing and we love the fact that they're doing all the market education for us, talking to content creators about content repurposing and the fact that you can be successful equally on all platforms. But Jelly Smack, and again, we really admire what they're doing.

• 37:03Sam Parr?

  Oh, come on, Orin.

• 37:05Speaker 04

  We really admire what they're doing, but they've been around for six and a half years and they have 500 customers and 2,000 employees. Manual labor is not really high-tech, new kind of what we're looking for. Using NLP and computer vision, we can do what Jelly Smack does, fully automatic, on a self-service basis and fully scalable. This is a whole new level of content management. And just to be clear, we're starting with content repurposing. The idea is that we distribute the content for the content creator on their behalf on all platforms, so we can take back the analytics that we get from the platforms and then create a kind of a cockpit in which the content creator sees everything that is going on

• 37:50Speaker 04

  and can understand what exactly they need to focus on, where is their niche, what is the topic they need to talk more about and kind of, you know, progress along the lines that every content piece can become 30 to 50 different types of content pieces, just create more data that you can then analyze and then create the whole feedback loop. So, yeah, this is the idea.

• 38:13Sam Parr?

  I have a question really quick, but what's stopping this? To me, maybe there's a world where this kind of becomes like the...

• 38:25Sam Parr?

  You know Buffer, Buffer.com started just by like you would schedule like tweets to go out and then like everyone kind of offered that same thing and that feature became somewhat of a commodity. Is there a world where this this thing that you've built becomes a commodity and you actually have to offer more stuff? Like for example, I don't actually know if this is true because I don't entirely know how they work. But it seemed like Jellysmack, one of the ways they make money is they actually don't charge the creator, but they put ads on the creator's videos and they take a cut. And so it's like the technology that they're offering is just like a feature. And the real value is that they are giving the creators more revenue by giving them an ad split.

• 39:07Speaker 04

  Always be the moneymaker, yeah.

• 39:10Sam Parr?

  Yeah, so is there a world where this technology you have really just becomes a commodity? And you got to offer other stuff in order to keep people on?

• 39:17Speaker 04

  Yeah, so the idea is is actually, you know, like dropshippers have Shopify and marketers have HubSpot. Content creators will have Munch. And the idea behind that is that currently there's no platform like that. There's a lot of vacuum in this space and currently this vacuum is being filled by hundreds of thousands of freelancers on Fiverr, Upwork and a little to to Medium agencies. So this is something that people already consume, but either they're paying a premium money for their services or they're giving up like between, and these are real numbers, thirty to fifty percent of the revenue that has been generated by the agencies. So yeah, the idea is that it's gonna be the central platform for content creators, the central copy they can use.

• 40:03Speaker 04

  And in terms of the business model, if this is what you're asking, so we have like two options and we're currently, we're still pre-seed. We're still, you know, playing around experimenting with the business models. We can do both things. We can charge a premium fee for the premium features. And there's, there's a lot of things that we can charge for, like, you know, creating, taking your podcast and creating Twitter threads for the next month that we can distribute at the right time. Or we can just use this inventory that is being created via Munch and integrate brands into it and do brand deals and get money from brands and pay the creators. So we're still not sure which business model will win. We're experimenting with both in the next few months, but yeah, it's like a, it looks like a huge potential.

• 40:50Shaan Puri?

  So I would not be interested in investing in this business for a couple of reasons, but I would say like, you know, the main, the main two is like, I feel like it's going to be based on how difficult it was to get us interested in the business. I think you're gonna, creators are super busy, a thousand opportunities coming at them at all times, and it seems like you're gonna have to really punch through the noise in order to be able to get there. And I don't really have confidence you're gonna be able to do that. That's kind of the first piece. A second is like, any time somebody's using AI, I'm like, oh, okay, you know, I gotta see it to believe it. Now, what I will say is, your pitch with the slides was putting me to sleep, but the pitch where you showed my face,

• 41:34Shaan Puri?

  I'm like, oh, wait, this is me? Great. You know, so, so I would, I would definitely lead with the demo. And that's not just for us, because we create content. A lot of people create content, a lot of investors do. But even if it wasn't us, hey, this is a popular podcast, blah, blah, blah. So here it is. It's the one hour thing. Not everybody's gonna watch it. Today, they pay, you know, editors and social media people, thousands of dollars a month to go find good clips, cut them out, post them on TikTok, post them on whatever, because they know they're leaving so much growth on the table if they don't do it. But with Munch, they'd either be able to do it themselves, or they can hand this tool to their person, so they can make 10 times more clips, you know, and not have to hire as many people. And so then you're explaining, you know, like, your demo was the most impressive part of your thing,

• 42:18Shaan Puri?

  where you're like, look, long video, push a button, I got a properly formatted clip option, and I have, you know, 10 of these that I could choose from, and we're trying to do this all automatically, right? So, so I think that you can, you can make your thing more compelling, if you kind of like work on how you explain it versus like, it was all intellectual, it was all theory-based, whereas you want it to be story-based, right? So instead of saying, you know, content creators, you know, have complexity when it comes to managing multiple platforms, that's intellectual, you want to make it a story, which is like, Here's these guys. They do this stuff. They record this three hour thing. The last thing they want to do is this. Or hey, for your podcast, right now, we have a $5,000 clip contest running. It's like you're paying $5,000 just for somebody to cut clips of your of your video into TikTok.

• 43:02Shaan Puri?

  What if I told you that I had a tool that would do that automatically for you? And your producer could just go do this, you know, in 10 minutes after their thing. They don't have to re-watch the video. They don't have to do blank, blank, blank. They don't have to resize it. They don't have to export it. We've done all of that for you. And the best part is, you know, blank. And so I think you can make this a lot more compelling, but as it is right now, I would not be interested in the business.

• 43:26Speaker 04

  Well, thanks for the feedback.

• 43:29Shaan Puri?

  For that reason, I'm out. Do we do the Shark Tank thing? I don't know.

• 43:32Speaker 04

  Yeah, yeah, yeah.

• 43:34Speaker 04

  Yeah, thanks for the feedback. And regarding customer acquisition, actually, this is exactly what we're doing. We're creating preemptively the videos for them. And then we send them via an email marketing machine that currently has like a four to five percent conversion rate and a database of 800,000 content creators on YouTube. And we're using influencer marketing because it turns out after talking with more than 100 content creators, the way that they learn about new tools and new platforms is by watching bigger influencers. So we're using influencers in order to get to more, more customers. It's kind of neat because we just got to 2,000 users in less than two months.

• 44:17Speaker 04

  So yeah, it's kind of starting to grow.

• 44:21Shaan Puri?

  Cool. Sam, anything else on your side?

• 44:23Sam Parr?

  The same question that I that I asked the other folks. And I don't know why you guys aren't doing it, but paint the picture of like, how's this going to make me wealthier? You know, like, like, I like get down to like my, my primal, like my primal desire here of like, I'm giving you money. So how big is this going to get? And how do you sell or go public and I get paid more than what I gave you? You know, like, paint that picture for me.

• 44:49Speaker 04

  Yeah, so why, once we have 5,000 users, paying users, we're gonna hit the $1 million ARO. It's an actual ARO because it's a recurring revenue. Once you charge them on a monthly basis. And there is a serious virality symptom in the area of content creation. It's kind of a PLG because once you create content with Munch, we have our logo and some mention to Munch on the content. The idea is that other creators are watching and getting into the game. So it's gonna be a very, very quick growth. In terms of sizes, current market is $65 billion. It's gonna grow aggressively in the next few years. So, you know, sky's the limit. It's gonna be a unicorn.

• 45:34Speaker 04

  It's gonna be a big company. And this is what we're aiming for.

• 45:37Sam Parr?

  Good, I appreciate you. Thank you very much. Thanks for coming.

• 45:40Speaker 04

  Thank you.

• 45:40Shaan Puri?

  See you, Orin. Bye.

• 45:41Sam Parr?

  I, Sean, man, like what I was saying to him about the, the English thing. Dude, it is, if you don't speak, if you have an accent, you're at such a logistics, like just in terms of logistics and understanding everything, you're at such a disadvantage for these things. It's a really, really hard thing to, to overcome. And it's, I mean, it's cool that people overcome it, but holy moly, I would not want to be in that position. It is tough, right?

• 46:09Shaan Puri?

  It is really hard and, and you know, I feel like that's why I think the, the deck and the story, I think, need to be kind of like crafted well so that that can be the kind of like universal language that you're working with as you, as you go through this.

• 46:25Sam Parr?

  I like, as an investor and even just like when I'm ever trying to assess out anything, I have to work extra hard to be like, okay, this person, well, like a lot of times we're investing, sometimes we're investing just on charm. Like, all right, this person is charming enough that I feel as though they're, they can convince other customers to buy or they can convince employees to join their company. You know, that's like, kind of like that Adam WeWork guy thing. And then there's other times where I'm like, okay, but like, what's the idea here? And is the idea good? And I have to kind of challenge myself to be like, to like, look beyond where they currently are because of maybe like a lack of.

• 47:06Sam Parr?

  It's just hard to understand, man. That makes a difference. And I have to like overcome that a little bit.

• 47:12Shaan Puri?

  Yeah. And I would say some of my best investments have come from very charismatic CEOs, and some of my absolute worst investments have come from charismatic CEOs. It cuts both ways.

• 47:22Sam Parr?

  Totally.

• 47:24Shaan Puri?

  By the way, I can't get into stocks. It's like dead for me. So I don't know.

• 47:27Sam Parr?

  I had to refresh it as well. And everyone in the chat is saying they had to refresh it, too.

• 47:31Shaan Puri?

  Yeah, when I refreshed them, let me in. But all right. Either way, that's okay. I don't need that open.

• 47:37Sam Parr?

  We want to do another one? I think one more or two more? One more?

• 47:43Sam Parr?

  There's Allison Nickelpass. All right. Or Zaza. Sorry, I don't know who's presenting.

• 47:49Speaker 06

  All right, that's me.

• 47:50Speaker 07

  Hey, guys. How are you?

• 47:57Speaker 06

  You guys can see my screen?

• 48:04Speaker 06

  I think they can. All right. What's going on? Name is Zaza, CEO and co-founder of Nickelpass. Before this, I was the head of international expansion at Huffington Post. After that, I was groomed to be the CRO, where I discovered we were not profitable. We were the largest news site in the world outside of China. And I didn't know, before I took the job, that we actually hadn't found a way to monetize the 200 million people coming to our websites globally.

• 48:32Speaker 07

  I'm Allison Paus, CEO and co-founder. Part of this, I was actually a banker for about 10 years. And our way of sharing news and information on the team was to have my EA print out an article, leave it on the center conference table, and say, please read. And that's certainly not a way of sharing news and information that scales when you're working on remote teams, distributed teams, and asynchronous teams. So Nickelpass really solves for all of that.

• 48:57Speaker 06

  And awesome. I'll just jump in. One of the things that we've come up with is the what we call cocktail party pitch. When we're at a party, people are like, what does Nickelpass do? And what we say is, you know how you get an article from a friend shared with you, and you get that pop up that says pay for the full site? Well, we invented a product where you never see that again. And the way our business works is we sell it to enterprises, which allows them to get up to 70% off of retail. And we customize the pass based on what each department and team and user needs to be successful. So here's the Nickelpass. I'm in front of a Business Insider paywall. I click a button.

• 49:36Speaker 07

  Oops, I don't think. There we go. Okay.

• 49:40Speaker 06

  There we go. Through the paywall.

• 49:45Speaker 07

  So I hit a paywall.

• 49:49Speaker 07

  I go to my Nickel Pass, which is a Chrome extension, click on Business Insider, and that's it. I never see a paywall again.

• 49:58Speaker 06

  So it looks like we're having a little bit of who's sharing what, but you guys saw the product. A couple of things about the business. So because of our background, the chairman of the company is the former head of strategy at CNN. We've been able to collect a network of over 200 publications, including the LA Times, Crunchbase Pro, Time Magazine. And we always like to point out that Beer Business Daily is on here for a reason. If I'm an enterprise, we work with Anheuser-Busch, they don't need just the New York Times, they also need Beer Business Daily, which tells them about how the craft beer market is doing in the Pacific Northwest. In terms of the business, we booked over a million in revenue, so that's a million of hard revenue, 1.2 bookings.

• 50:38Speaker 06

  Some of the companies we work with include Anheuser-Busch, as mentioned, Visa, and also Publicis and Havas, which are respectively the number one and number two marketing and PR agencies in the world. In terms of why people come to us, if you wanted to get these subscriptions yourself, be our guest. It costs you over $1,000 a year just for five different sites. Obviously, that's not going to scale if you're an enterprise. And some of the other problems in the space and the reason we've been able to get some traction in 18 months. Number two, there is no tech-enabled way to buy group subscriptions. So if you wanted 10 licenses from the New York Times today, you're essentially filling out a form. And then number three, now three out of every four news sites require a subscription or have a paywall.

• 51:22Speaker 06

  When we started the business, now, a little over three years ago, that number was at 30%, so about one in three sites. So we'll stop there.

• 51:32Sam Parr?

  This is awesome. This is awesome.

• 51:35Shaan Puri?

  So we can just recap, because I think some people are having trouble in the stocks platforms. They might have missed the beginning of the pitch. But basically, what you did is I work at a company. I go try to click some article to read some important news story that some of my coworker sent me. I get hit with a paywall. Oh shit. Hey, man, what did it say? I don't have a Business Insider subscription. And our company, which is, let's pretend we work at Google. Oh, Google uses Nickel Pass, so I can just use the Chrome extension and bypass the paywall because Google has paid for a multi-seat license to Business Insider. So Business Insider is getting this huge bulk subscription buy. And they'll give it at a discount. Yep. Google wants its employees to be able to read news and employees don't have to pay for it out of pocket. That's what happens.

• 52:17Speaker 07

  That's, that's, that's exactly.

• 52:19Speaker 06

  And I'll add some other things. Publishers right now convert less than 1% of the people that come to their website to pay for the full subscription. So it's a win-win for everyone where they, they're basically getting all of these people that they would be monetizing at cents on the dollar per year from advertising.

• 52:33Sam Parr?

  But do you, if, if Google buys 20 seats, do they only get Business Insider? Or do they also get all the other publications you had listed there? And if they, if the second one, how do you figure out who, which publisher gets paid what money?

• 52:46Speaker 06

  Right.

• 52:46Speaker 07

  Yeah, so we have over 200 publishers in our network. We add more every day. We create bespoke packages. So how, we have an initial package that you pick six out of 10 publications. It includes Business Insider and many others. And that's $23.95 a user a month for that package. After that, we'll upsell from there and we work with customers to design custom packages based on the industry you're in and the role you're in, in your industry. So if you work at a big bank and you're in marketing and PR, you're going to need a very different set of publications than someone who's at the comms team at Google. But we'll be able to work with you to customize that and a lot of that you're now able to do on your own on our administrative panel.

• 53:29Sam Parr?

  But then how does, if, let's just use round numbers, let's say it's $30 a month. And you have two publications, does Business Insider get $10, New York Times get $10, and you guys get $10?

• 53:42Speaker 06

  So what we do is we work with the publishers to either take rate cards they have or create ones from scratch. And so that way in the custom package, the publisher's always made whole. So in your example, it all depends on the number of seats that Google signs up with. So if they sign up with 10 people or 1,000 people, the price may go from $10 a month, which is a 20% discount off of retail, to $2 a month, which is, you know, much more off of retail. And then we bundle that and then charge an administrative fee on top of that, and that's the bespoke package.

• 54:14Sam Parr?

  What's the fee percent?

• 54:16Speaker 06

  So right now gross margin is anywhere from 44 to 55%. And that's a combination of not only the seat fee, but we integrate with Okta, Microsoft Active Directory. So it's really single sign-on for news publications and we basically handle all of the admin for both the enterprise and the publisher.

• 54:36Shaan Puri?

  That's amazing. So let's talk about the traction. Okay, so you showed a bunch of publications that you guys have gotten to agree with this. How many companies are paying for this? I don't know if I missed that part or it wasn't in there.

• 54:49Speaker 06

  Yeah.

• 54:49Speaker 07

  Yep. So we have over 125 companies who we currently work with and we're adding more every day, both smaller companies as well as large enterprises.

• 55:00Shaan Puri?

  And what does that mean for revenue for you guys?

• 55:03Speaker 07

  Yep. So we're at 1.2 million ARR and we're on track to be 3 million by the end of the year.

• 55:12Sam Parr?

  And raising at a $15 million valuation?

• 55:17Sam Parr?

  And that's three million as in net revenue. And you get, or is that three million as in you, there's three million, there's three million for the bundle and you take forty five to fifty percent of it.

• 55:29Speaker 06

  Correct.

• 55:30Sam Parr?

  The second one.

• 55:32Speaker 06

  Correct.

• 55:33Sam Parr?

  So more like one point five million is that in real, in net revenue, is that right?

• 55:39Speaker 07

  In net revenue, yes, one point five.

• 55:42Shaan Puri?

  And, um, okay, great. And so, and how do you, how do you onboard customers? So what, what do you do to go get the next twenty five, fifty customers? What, what happens?

• 55:53Speaker 06

  Well, I think one of the things that we're really excited about is the hundred and twenty companies we have, they have over four hundred thousand employees. So what we've found is that it's much easier to upsell within an organization once you land them. So what we're seeing is that our growth trajectory, if we go from the one percent to the three percent, that's how you get to the three. And that's why I'm only focusing on two segments right now, marketing and PR and the consumer finance. That doesn't count telco, doesn't count some of the tech companies you mentioned. It doesn't count international, which is actually my background post.

• 56:24Shaan Puri?

  Gotcha. So you're just going to expand within the companies you're already in to get to, to get to three billion gross. Okay. But how do you get more customers, uh, from here? What is the strategy? Is it outbound? Is it inbound? Is it a referral program? What, what do you do?

• 56:36Speaker 06

  Yep.

• 56:37Speaker 07

  Yeah, it's, we primarily have a cold outbound marketing strategy. Um, so we do a lot of lead gen, um, and then we do some organic search, organic social.

• 56:47Shaan Puri?

  And now this is a cost to companies at a time when a lot of companies are cutting costs, right? So today, uh, they're just not paying for this and employees are just not getting the benefit or they're paying, you know, employees pay out of pocket.

• 56:58Speaker 06

  Yeah.

• 56:58Shaan Puri?

  Um, if I do this and I have, you know, one percent of my employees doing this, all of a sudden I've added a, I don't know what your, what your average volume is, but let's say ten grand, ten, ten grand a, a year. What, what is the average cost to a company?

• 57:13Speaker 06

  So that's grown. When we first started, it was roughly the seven to 10 grand a year. Now what we're seeing is 50K and that having opportunity to grow. And here's the thing, you know, people see it from two lenses. So there's the cost savings and they look at our class and they're like, well, it's better than everyone buying it at retail than expensing it back to the company. So that's one thing. The second thing is, in a time like this, if you miss a critical piece of news in your industry, the opportunity cost for that is much higher. And so you're going to feel some type of way for not paying the 50 bucks per person per seat. Because you were like, oh, I was trying to like, basically refine the cost. We like to say, what we're going after is the budget people used to use on soda machines. Because this is one of those.

• 57:58Speaker 07

  Oh, I think we've lost out there. But yes, this is an expense that people actually already have. They just don't realize it. Frequently, it's being put on personal cards and then expensed back to the company. So the other thing that we're doing is actually giving finance and procurement a single light on them. So they really understand how much they're spending on news and information and data, which for the 40 professional, the 40 million, the 40 million professional services workers in the US is extremely important to know.

• 58:30Shaan Puri?

  Okay, great. I also feel like there's probably some strategy where you go to Anheuser-Busch and then has, you know, once they have their 1% of people on, you go to every other beer company out there and you say, hey, Anheuser-Busch does this so that their employees can read Beer Journal Daily and this and that, you know, would you guys be interested? There's a, I think within industries, you could sort of play, play off each other a little bit.

• 58:52Speaker 07

  Exactly. And we've seen that social proof model work extremely well with marketing and PR firms and with financial services firms.

• 59:00Sam Parr?

  Alison, how big is this going to get? You know, what are you, you're going to get to 100 million in recurring revenue? What's going to happen?

• 59:06Speaker 07

  Yeah, without a doubt. So we are, we see ourselves as really the next version of cable. And how we access news, content and information digitally is going to change drastically from how it, it works today. And Nickel Pass is going to be the single stop solution for that.

• 59:23Sam Parr?

  What, how many employees?

• 59:25Shaan Puri?

  Let me ask that same question a little bit differently. Because Sam likes to hear the kind of, how big is the dream? I like to hear it a little bit differently, which is, what would I need to believe for this to be at 100 million in revenue? Meaning, how many companies, how many people, what, how do you work your way to 100 million in revenue?

• 59:42Speaker 07

  Yeah, so our goal has always been to get everyone access to quality news and information. And by everyone, we don't just mean professional services workers. We also mean individuals and there's a certain price point that individuals can pay for access to quality news and information. So we're exploring what that is, but I think it's extremely important to note that over the past five years, we've understood and I think the general public.

• 1:00:06Shaan Puri?

  So actually, could you give me the math? So like this many companies paying this much a month is 100 million in revenue. And then I need to know, is that a believable number of companies? That's like, you know, out of the total universe. So how many companies would you need to be paying you for you to be at that point?

• 1:00:20Speaker 07

  Yeah, so we'd need to be at about 10,000 companies based on on our initial math.

• 1:00:26Shaan Puri?

  So 10,000 companies and you think that those will, you know, right now you're at whatever 25, you think by the end of the year, you can get to maybe 40 or 50, something like that.

• 1:00:37Speaker 07

  Oh, no, no. So we're at 150 right now.

• 1:00:39Shaan Puri?

  Sorry, you're at 150. Great.

• 1:00:41Speaker 07

  Yeah, we're, you know, well beyond the that initial group.

• 1:00:44Shaan Puri?

  And what are you guys going to have to do to go from 150 to 10,000 companies? What will actually need to happen?

• 1:00:50Speaker 07

  Yeah, so it's it's two pronged. It's that we have to increase our penetration rate on the existing companies from 1% to 3%. And that number is even achievable up to the 5% or 10% range. And then we have to increase our penetration in the in the specific sectors from currently 0.01% to closer to 1% in each sector. So financial services, marketing and PR, and then universities and associations as well.

• 1:01:18Shaan Puri?

  Gotcha. Okay. All right. Thanks. I think we might be up in time.

• 1:01:20Sam Parr?

  I had one more. Did you have you raised any money so far and from who?

• 1:01:24Speaker 07

  Yeah. Yeah, so we've raised about 5 million so far. That's our last round was led by River Park Ventures. So the Seamless food ordering company co-founders, because they took the same B to B model to get to a B to C model. And we have a number of other institutionals as well, 68 Capital Rain Ventures.

• 1:01:45Sam Parr?

  Damn, you raised 5 million at a $15 million valuation?

• 1:01:50Speaker 07

  No, smaller valuation in the past. So this new this new round is 15 million free money.

• 1:01:56Shaan Puri?

  So you gave up a lot of the company.

• 1:01:58Sam Parr?

  Yeah, what are you? How are you going to stay motivated? You got to.

• 1:02:02Speaker 07

  Yeah, so I understood. So we are reworking the cap table as we speak because basically we pivoted the company from a blockchain micropayments. And so that's total over the pivot.

• 1:02:17Sam Parr?

  That's a

• 1:02:18Shaan Puri?

  By the way, respect for pivoting away from blockchain, that sort of shows me that you're a clear and independent thinker that didn't just like, oh, here's the trend. We are a web three company for micropayments, you can get lightning. And it's like, what do our customers actually want? And in this case, you found out what they actually wanted, which was not, not that.

• 1:02:37Speaker 07

  Not that. Yeah, customers hated it, publishers loved it, but it wasn't selling to to anyone as recurring revenue. Right. And we could have raised it a much higher valuation, but we chose to pivot.

• 1:02:49Sam Parr?

  I think, I think your product is awesome. It sounds like your cap table is shitty, to be blunt. I would love, I would love to hear a little bit more about how you, I don't want to hear about it now, but like, how you're going to get out of that situation. I think it's, it's, hopefully it's fixable, because this product sounds pretty sick.

• 1:03:05Shaan Puri?

  And we got to ask, people are asking, why, what is nickel pass? What is this name? Why are you named after Nickelback?

• 1:03:11Speaker 07

  Ah, news used to cost a nickel. So that's why.

• 1:03:15Shaan Puri?

  Okay, great. And now it costs $23 per person per month.

• 1:03:20Speaker 07

  $23 a month, yep.

• 1:03:21Sam Parr?

  Congratulations. This is sick. This is sick. I think your pitch was awesome. I said what I thought about the cap table. The product's badass.

• 1:03:29Shaan Puri?

  One little thing between you

• 1:03:30Sam Parr?

  You guys threw your act together, though.

• 1:03:32Shaan Puri?

  Between you and your co-founder, you guys should figure out who's going to answer questions and which types of questions. So you automatically know when to defer, because it's a little bit of a signal when you're doing a pitch and like, both of kind of like me and Sam, we talk over each other a little bit. It's okay to podcast or room, but as a company, you kind of need to know, okay, technical questions, this person's going to answer, growth questions, this person's going to answer, or this one person is going to answer everything. And then they're going to say, you know, Alice, why don't you talk about that? You're, you're, you know, she knows this better than anybody. And so you'll be able to kind of defer a little bit better in that sense. But good, really good job overall with the pitch. That's my only kind of like pitch feedback for you.

• 1:04:08Speaker 07

  Great. Thank you, guys.

• 1:04:12Speaker 08

  This data is wrong every freaking time.

• 1:04:15Speaker 09

  Have you heard of HubSpot? HubSpot is a CRM platform where everything is fully integrated.

• 1:04:20Speaker 08

  Whoa, I can see the client's whole history. Calls, support tickets, emails, and here's a task from three days ago I totally missed.

• 1:04:29Speaker 09

  HubSpot, grow better.

• 1:04:32Sam Parr?

  Sick, sick company. God damn, man. That cap table really fucks things up for her.

• 1:04:38Shaan Puri?

  Yeah, uh, yeah, I think that's okay, though. I think it's recoverable or, um, you know, like, some people, like, you know, how are you gonna stay motivated? Some people are motivated, you know, the number, whether they own 50% or 35%, they sort of feel the same about it. It's their baby. And also, they can be motivated by their regret of giving away so much of their company in the first round.

• 1:04:58Sam Parr?

  That's crazy to me. I, um, I am friends with this guy who sold his company for a billion dollars, and he, 990 million, and he walked away with $3 million because he had, it was five of them, either, or four of them. So it was four or five of them, and then they raised all this money, and he walked away with $3 million on a billion-dollar value sale. Isn't that crazy? I can't, I don't understand how you get motivated when you're not gonna get paid.

• 1:05:27Shaan Puri?

  Yeah, well, some people, uh, some people motivated by the mission. Some people don't do the math. Some people are like, well, fuck, I'm stuck now. I made that mistake, and now, uh, I guess I gotta live with that. I guess I gotta eat that one. By the way, shout out to her. We don't do public math, but we sure as hell make founders do public math when they pitch us, because, you know, you gotta be able to answer that question. In fact, I don't even care what the, like, some people think that when I ask that question, how do you get to 100 million, or how do you get to 10 million ARR? I'm like, judging whether, uh, I'm judging whether that thing sounds feasible or not, and that's part of it. But the bigger part of it is, does this seem like the first time they've done this math? Or have they done this before? Because if they haven't done it before, I'm like, oh, this person's not actually thinking of plotting

• 1:06:11Shaan Puri?

  how to, like, take over, and like, how to build this into something big. They're just kind of like buried their head in product, and like, they may not have, if they haven't thought of it up till now, they're probably not gonna be thinking about that in the future. In this case, I thought that she... She had an answer. I haven't done the math to go check if that answer was like bullshit or real, but she had at least thought about. We need 10,000 companies at our current pricing and scale to be at that revenue mark.

• 1:06:37Sam Parr?

  Well, and I think people think it's a trick question towards like, how does this get big? Or how are you going to exit? And they'll say like, this bullshit of like, well, we're not thinking about an exit. It's like, dude, come on, just like this, like, talk real. Like, a good answer is like, well, the worst case scenario is I think we'll get to 5 million in this many years and someone's going to buy us for $50 million and you'll get a two or three X return. I think that's like a likely worst case scenario. Best case scenario, I actually think we have a clear path to 75 million and we're going to figure out as we go. And I think these possible doors might open up and then we could either go public, which I would love to go public, or we could sell for this much money, or we just own the company forever and we grow into this.

• 1:07:19Shaan Puri?

  See, I think that answer works on you because you invest your own money. For most venture capitalists and investors in other people's money, they don't care about the two to three X.

• 1:07:27Sam Parr?

  I know, but I'm saying-

• 1:07:28Shaan Puri?

  The downside protection. It's like, to them, it's either a zero or it's huge. And so you're better off focusing most of the energy on the, how this ends up huge. And you might just say, you might say things like, so you don't have to say, oh man, I can't wait to go sell this for a billion dollars. But I think you could say like, like, we had a buddy, Ramon, who was telling us about this. He's like, look, right now I have, you know, I don't know what it was, like 100,000, you know, like pet owners who have bought from me and I know their name, their address, their dog's name, their dog's breed, their dog's age. I know everything about them. He goes, and he named like the big, you know, Chewy doesn't know any of that because they sell on store shelves. But I have the largest databases. I think that asset's going to be worth a lot of money to one of these companies.

• 1:08:13Shaan Puri?

  And I think that, you know, that's beyond just the sales that we're already doing. And so you can kind of say your downside protection that we're building a valuable asset.

• 1:08:20Sam Parr?

  That's kind of what I mean. I'm just saying that like, it's okay to show weakness and it's okay to show uncertainty. But at the same time, you also want to have like a, yeah, but I think this could happen and here's how.

• 1:08:31Shaan Puri?

  What the flight booking guy said is also perfect, which is you don't have to say this is going to be a billion dollar company and just go autopilot like a venture capital robot. Like, you know, what he could say is basically-

• 1:08:43Shaan Puri?

  You know, he's like, he's like, you know, I don't know what the, I don't know where the ceiling of this is because nobody's ever done this before, but there's a clear path to 75 million and we're going to get there and we're going to look up and figure out what's next. And I think that's a totally honest, but also exciting version of that answer, which is to say like, look, we don't know how high this thing can fly, but I know there's a clear path to this. I'm just laser focused. 50 million ARR before I go to bed, I kiss my daughter goodnight and I say 50 million in ARR. And when I wake up and I'm brushing my teeth, I say 50 million ARR because I know that that's what's in front of us. And like, I can't sleep because it's so obvious that there's a step-by-step path to go get there. So you can say some bullshit like that and people get like, people start to believe that you believe that that's your certainty that there's a clear path to that makes them certain

• 1:09:28Shaan Puri?

  there's a clear path to it.

• 1:09:29Sam Parr?

  Badass. Let's do the last one.

• 1:09:34Shaan Puri?

  What's up, Colton? Take it away.

• 1:09:37Speaker 10

  Hi, I'm Colton Woodard, founder of Little Ducky's Pool Company. I'm a pool industry expert with a knack for sourcing companies that may not know they want to sell and creating acquisition plan. Started out with my own pool maintenance business from zero clients. Now I make about 18,000 monthly reoccurring revenue all in under three years. My father-in-law owns a large pool resurfacing company in Orlando, Florida, and found our first private acquisition deal from a friend who was feeling like he was ready to retire. Instead of just letting his business dissolve, we negotiated a purchase at about a multiple of, you know, four months of the monthly gross revenue. Currently, we've secured two upcoming purchase

• 1:10:18Speaker 10

  contracts in the South Florida pool construction sector with another in negotiation for quarter four. We are projecting 10.3 million in gross for our 2023 sales with a yearly increase of 13% as we streamline the processes and add in modern tech. We're looking to build a portfolio of pool construction companies in South Florida and gain a majority of the market share and then add in pool cleaning and maintenance on these accounts for additional monthly reoccurring revenue. Ideally, we'd like to secure locations in all of South Florida within the next five years with four owner operators in place who know the industry, know the business, how to utilize specific contractors. We're looking to take over the

• 1:10:59Speaker 10

  industry and build an empire. Like real estate, now is the hottest time to invest in South Florida pool construction.

• 1:11:10Sam Parr?

  Sick. So, uh, let me, is this basically like a PE play where you're buying, uh, baby boomers businesses who put pools in people's backyards?

• 1:11:24Speaker 10

  In a simple, in a simple explanation, kind of. Yeah. I mean, it's, it's a little harder than that because, you know, South Florida, you dig 54 inches, you hit water. So if you don't know what you're doing, you could really muck it up. Um, but yeah, so we know the industry, we know the pool, we know pool construction. So we can find people that are ready to retire. And instead of letting their business just go to the wind and the other guys pick it all up. Um, we can utilize different contractors that specialize in, you know, form and steel excavation. Take his company and he subcontracts out to the plumbing guys and the tile guys, the screen enclosure guys, and he's spending so much money on paying subcontractors, whatever they need to charge

• 1:12:08Speaker 10

  because he's got to hire them because he can't do it himself. So we buy these individual companies that can complement each other, bring everything in-house, and we can get our permits done faster, reduce our wait times and increase profits and turn over more projects year over year. So that's why we're looking at 13% increase on our productivity.

• 1:12:28Shaan Puri?

  So just, uh, multiple choice answer. Your company does what? Do you A, sell software? B, buy existing pool companies? Uh, C, invest in pool guys? Or D, other? Which one of those four things do you do?

• 1:12:44Speaker 10

  B, we, we buy pool companies. Mergers and acquisitions. Yeah.

• 1:12:47Shaan Puri?

  So you, you're rolling up pool companies and you're rolling them up and you are a good, you are not buying them for less or anything like that. You buy them at some fair value, but you are better operating because you do what? A, you, uh, have different expertise in-house? B, you have better software? C, you, uh, have economies of scale? What is the, the advantage you have by them?

• 1:13:10Speaker 10

  Uh, A and B. So we, we know the business. We do it well. And we implement modern technology. So 3D modeling designs for the pools. So we can email it to customer. We don't got to go to their house with a pen and paper and show them how it's done. So we can just email it over and then also since COVID hit permitting has been horrible. It slowed down a lot. Now we can do digital permitting where we can be on video chat with the, uh, with the county that we're working with and they can be right on the phone. We could show them step by step and get the phases approved without having to wait for time on their schedule for them to come to the site.

• 1:13:45Shaan Puri?

  So the result is you guys build pools for faster and cheaper. How much faster and how much cheaper?

• 1:13:52Speaker 10

  We build them faster. We don't build them cheaper.

• 1:13:54Shaan Puri?

  How much faster?

• 1:13:57Speaker 10

  It, it depends on the county. You know, each county is going to be a little bit different, but if you don't have to wait on the subcontractors to get you on their schedule or not show up and, and reschedule on you, it's, it's going to be at least 20% faster.

• 1:14:10Shaan Puri?

  20% faster. Okay, great. And you, up till now, you've bought how many pool companies?

• 1:14:15Speaker 10

  So right now we've signed, we have our own, we own two, but we bought, uh, we have two purchase contracts signed in agreement and we have one in negotiation, um, that we're looking to get another, uh, round of funding for.

• 1:14:27Shaan Puri?

  And then explain, when you buy a business like this, uh, you know, it has this much in EBITDA typically, it's been in business for 10 years or whatever, and you're buying it at some multiple, um, and you're financing it how?

• 1:14:39Speaker 10

  Well, the first two, we sold our houses.

• 1:14:43Shaan Puri?

  Okay. What are you going to do for the next two?

• 1:14:46Speaker 10

  Uh, we're looking to raise capital and then we're also going to make a plan using the, um, signed contracts. Usually you're two years out, you know, two years booked out with these, with these contracts for the pool companies that we're buying. So not only we're buying the company, we're buying the crew. We're having the owner stay on for two years as a consultant while we put a project manager in place for him to train. And then we're getting all of those contracts, um, and they get paid in phases. So we'll use some of the working capital to put aside into another fund to use to purchase more businesses as we, as we roll out. All the locations we need between, like I said, Formon Steel, excavation, shot,crete, tile, marsite, plaster guys, we're gonna buy all the specialty contractors and roll them all into one company.

• 1:15:31Sam Parr?

  So Sean and I, one of our best investments ever, I think we both invested at the same time into a business, Sean, you still there?

• 1:15:39Speaker 10

  Yeah.

• 1:15:39Sam Parr?

  We both invested, we invested into this business that started by our friend Siava, it called Endur Ventures, and his whole premise was to buy businesses that baby boomers want to retire and their kids don't want to take it over, basically.

• 1:15:54Speaker 10

  That's exactly what's going on.

• 1:15:56Sam Parr?

  And Sam Zell, Sam Zell's the guy who basically created the REIT, he owned Schwinn Bikes, he owned the Tribune, he owned a bunch of stuff, rich guy, he owned Waste Management, I think, anyway, he said recently in a podcast that he is making more money off of buying businesses from baby boomers who don't want to pass their companies on to the kids than he has ever made in real estate.

• 1:16:18Speaker 10

  Yeah.

• 1:16:19Sam Parr?

  And so that's just for the proof that this is actually quite interesting, and I think Siava actually bought a pool business, didn't he? Sean, did he?

• 1:16:26Speaker 10

  Yeah, golf and pools, it's in Arizona.

• 1:16:29Sam Parr?

  Yeah, and they're killing it. I would argue that that's probably the path you should go, and for these pitches, you should entirely pitch it that way.

• 1:16:39Sam Parr?

  Another way that you could maybe pitch is the guy who started, I was gonna bring this up on the podcast, Sean, but the guy who started WeUpwork, have you heard of Upwork? It's like the outsourcing tech company. He started this new company called, I actually don't know his, Ergeon, E-R-G-E-O-N, and it's a fence contractor and installation and repair business. And he just raised like forty million dollars for it, and he bootstrapped it to like four hundred employees. Do you see this, Sean?

• 1:17:09Speaker 10

  No, I've never seen that.

• 1:17:10Sam Parr?

  Dude, it just got relaunched, like, or it just got released like two days ago on TechCrunch. He was like, they were like, we wanted to keep this in the DL, but basically we bootstrap this into a monster business, and we just raised financing for it and at a huge valuation because getting someone to build a fence is a pain in the ass. Well, we just went and just like, so what they did is they used a little A little bit of technology and they made the process easier and better. What Cieva is doing is he's just saying, no one wants these businesses. We're going to buy them for cheap and we're just going to install a manager and let it run. So anyway, I think if I was you, I would go one of those two routes and I would go all in on one of those two routes. I imagine seeing that your website, I went to it, it looks like it's built on Wix. Technology is not going to be where you're going to play. It's going to be the PE route.

• 1:17:54Sam Parr?

  But the problem is, is you don't actually seem entirely bought in on that route. So that's like my fairly critical feedback. Do you think I hit the nail on the head there, Sean?

• 1:18:03Shaan Puri?

  If I can, go ahead, Colton.

• 1:18:05Speaker 10

  If I can interject, I, I think that, yeah, that's, that's pretty accurate. It's a little, it's a little bit more difficult. You know, these guys, they are retiring, but they also, it's very difficult to get into this industry. You have to have four years of experience and then go in front of a board, the DPBR, to even get approved to have the license to do it. So it's not like millennials or Gen Z can just, hey, I'm going to start a pool construction company today. You're going to have to go work for somebody for four years to get that experience to even do it. So it's, it's really not super turnkey. So there's not a lot of competition for the PE to go out and scoop them up. You know, we're, we're poised and ready to strike.

• 1:18:49Shaan Puri?

  Okay. Yeah. Um, I would say, I'm just going to give you some pitch feedback because I think your pitch was, uh, confusing and therefore hard to raise money, which is what we're here to do, right? So, um, number one, uh, like use a, you, you had a slide up there that had a bunch of text, but then you talked a bunch and you weren't talking exactly, you weren't just saying the points on the slide. You were telling a story, which was good. It's good to tell a story, but if you're going to tell a story, just put like a picture on the screen. Um, so it's like, you know, this is, uh, you know, this is my pool company. We've been doing this. This business spits off this much cash and we're, you know, we're not alone. There's. 400 of these just in the Florida area where I, you know, where I'm from. And I've bought two more of these and these are great businesses to buy.

• 1:19:34Shaan Puri?

  In fact, I sold my house to buy these because they're such a better investment than my home. And, you know, this first one we bought, we bought it for this much. It's already paid itself off in two years and blah, blah, blah. The second one, blah, blah, blah, same thing. And for each one of these, we have a playbook of how to buy it, grow it and like improve it from where it was. We improve each of these businesses by over 25% within the first year. Okay, great. So we're going to keep doing this. We have a plan that is working. You know, but I don't have any more houses to sell. So it's time for me to go raise some money. And what I'm going to do is I'm going to raise $5 million. I'm going to go buy $20 million worth of pool companies. And we're going to start rolling these up. You've probably seen these rollups get pretty big. This roll up in the dental space got this big.

• 1:20:17Shaan Puri?

  This roll up in the pool space got this big in a different state. You know, Sam Zell, the guy who invented the REIT is doing, doing these roll up. The guy who started Elbork is now doing this with fencing companies. This is a strategy that works. Now, the problem is most people don't have what I have. They don't have 15 years of pool construction experience. So even if they wanted to do this, they wouldn't really know where to start. They wouldn't know the nuances of permitting. And I could say a bunch of words you're not going to understand. But that, those are kind of 15 years of hard-won lessons. And so today I'm coming here to, I'm going to raise this. I'm going to build a billion dollar pool roll up company. And like, you got to say the category of your company, the size of the product, all of that. I think would be like, I don't know. If you heard that in the chat, I know Snack's having some problems right now. But if you heard that in the chat, go one to 10.

• 1:21:00Shaan Puri?

  Where was my pitch on a scale of one to 10 of clear and compelling? Because that's where you need to get this to, because I think you actually have a really good idea. I don't, I don't think.

• 1:21:12Speaker 10

  We, we need a smart investor like you, Sean.

• 1:21:17Speaker 10

  You, you said it perfectly.

• 1:21:18Sam Parr?

  Yeah, but he didn't want to do the work. He wants you to do the work.

• 1:21:20Shaan Puri?

  Yeah, I want you to be the one who says like, you know, I, I want to invest in people who figure these things out. If I'm, if you need me for help, honestly, it's usually a bad sign for my investment. Like I want to be helping a rocket that's already going and not like pushing something that's at a standstill. And so.

• 1:21:39Speaker 10

  Well, you know, you know, the investment industry and you know, the rollups and you know, the comparables. I'm, I'm out here doing the, doing the hard work managing the crews.

• 1:21:47Shaan Puri?

  Fair enough, fair enough. And so I think, take that and basically say, okay, the problem was, I wasn't clear on what type of investment vehicle this is. This is a roll-up. Second, I gotta weave my story, just a bit of my story, which is that I'm, I got tons of experience doing this. I've already started my roll-up. This is not just a idea that's pie in the sky. I already got the first two under my belt. I did those myself, bootstrapped, and they're working. And now I just gotta sell you how we're gonna go from two to 20 doing this. And that when we have 20, it's gonna be worth this much, because I can just do some math. Say 20 times, each one is worth $10 million. Now I got a $200 million roll-up, if we, if we could pull this off, right?

• 1:22:27Speaker 10

  Beautifully said.

• 1:22:28Shaan Puri?

  The other thing is, you didn't say anything about debt. Are you taking on debt for, for doing this? You said you're kind of raising money to buy the next ones. Why aren't you using debt?

• 1:22:35Speaker 10

  We haven't taken any loans. We thought about it, we thought about doing SBA, but,

• 1:22:41Speaker 10

  I mean, it, it just made more sense to Seller Finance. So what we, we actually did was, we negotiated like a 10% down with Seller Financing over five years of the balloon payment. And it's so cheap, we can just scoop them up.

• 1:22:54Shaan Puri?

  Dude, why didn't you say that? That's a, that's a great point. I'm buying these for 10% down.

• 1:23:00Speaker 10

  I'm giving away my secrets over the internet to thousands of people, now millions of your podcast listeners, so here you go.

• 1:23:05Sam Parr?

  Bro, no one's gonna, you, you said yourself.

• 1:23:07Shaan Puri?

  It's not a secret. Seller Finance is not a secret.

• 1:23:13Shaan Puri?

  In fact, you kind of made it sound like you don't know what debt is, because you didn't say anything, but now we've revealed the truth. Okay, great. Honestly, again, I think you actually have a very good business idea. Presented slightly differently, that'd be, you know, I think it could be very investment-worthy, especially right now. You know, you see stocks going down, you see crypto going down, these private companies are raising a huge valuations with like, you know, software and a dream, whereas you're like, actually, I buy successful, profitable companies, and I'm just a better operator than the mom and pop, and I'm gonna aggregate these because like, I just have a playbook that I could just keep rolling out. And by the way, I buy these for 10% down. So that means, you know, you know, my cash on cash return after, you know, 15 months, looks like this.

• 1:23:58Shaan Puri?

  And so you, you have a very, very strong pitch. And you just gotta like, you know, put it all together.

• 1:24:05Speaker 10

  Yeah, after 30 years of doing something, they're gonna be real tired. You know, they don't wanna, they don't wanna push the needle, they don't wanna make it bigger. They have a paycheck coming in, salary, they're taken care of, so.

• 1:24:15Shaan Puri?

  Right.

• 1:24:16Sam Parr?

  There was a guy, so right now for the listeners, Colton, he's sitting in front of a bookshelf that's empty and someone just says, Peter Thiel's Zero to One is not on his bookshelf. And for that reason, I'm out.

• 1:24:29Speaker 10

  This is where all of my trophies are gonna go for, for all the wins we're about to have.

• 1:24:35Sam Parr?

  Oh, lean startups not on his bookshelf? For that reason, I'm out.

• 1:24:40Shaan Puri?

  Yeah, dude, you seem to be spending too much time actually building your business. I need somebody who's way more into reading about business.

• 1:24:47Sam Parr?

  Yeah, you don't seem like you do yoga. I'm out. You're on a gamer chair. You're not like on a treadmill desk. I'm out.

• 1:24:53Shaan Puri?

  You eat carbs? I'm out.

• 1:24:58Sam Parr?

  That's hilarious. Thanks, dude. Thanks for coming on.

• 1:25:01Speaker 10

  Thank you so much.

• 1:25:03Sam Parr?

  All right. I asked, I don't know if Ollie's gonna pop up, the guy who started stocks, but that was, that was fun. Some, I think some people need some work on their pitch, not as much work on their business, but work on just like saying what the fuck they do.

• 1:25:18Shaan Puri?

  So let's go most interested to least interested. Let's rank the companies based on that. I'll kind of remind you what they were. So there was 5X. That was the first business that pitched, which was doing something that we could barely understand, but at a million dollars of ARR commitments, you know, for his kind of like marketing stack that he was, or you know, there's like vendor stack that he was putting in a box. Then we had, I think, Fly Together, which wasn't their name. It was like Bakari or something like that, group booking on travel. Third one we had was Orem, who was doing Munch, I think, which was taking creators' content and letting you chop it up into bits and letting them, making it easy for them to repost using AI and some software.

• 1:26:00Shaan Puri?

  Then we had, the last guy was Duckies. And before that, we had Nickel Pass. Did I miss anyone?

• 1:26:07Shaan Puri?

  Yeah.

• 1:26:09Sam Parr?

  All right.

• 1:26:10Shaan Puri?

  I did miss someone or no?

• 1:26:11Sam Parr?

  No, I don't think you missed someone. I think my ranking from most to least, from the ones I would want to invest into the least, I would actually put nickel and fly together. Maybe nickel first, but the fly together Bakari, I would put that they would trade for one or two. In the middle would be 5X and then tied for the bottom ones would be the Jelly Smack competitor and Ducky's.

• 1:26:35Shaan Puri?

  Okay. All right. I like it. Mine would be fly together. Number one, I thought that he seemed great and the business seemed, you know, pretty straightforward and had momentum. And, you know, I'd need to go look at the competition. Like, is it really as backwards? And he's kind of the only real one doing this as it made it sound, but I like the sound of that one. I actually think that Ducky's is probably the second or first best investment, but I'm not sure I would want to invest in Colton just because, you know, he seemed like, I think I would want to hang out with him, but I'm not sure I'd want to invest in him because I feel like I'd just be frustrated because he speaks a different language than me. He speaks like digging holes in the ground and building pools and like I speak like frameworks.

• 1:27:15Sam Parr?

  It's like, hey, Colton, I like you. Just change the way you look for me, please.

• 1:27:20Shaan Puri?

  Yeah.

• 1:27:20Sam Parr?

  Just like, just talk entirely different for me, will you?

• 1:27:23Shaan Puri?

  If I invested in it, I'd be like, look, we're allowed to hang out, but we'll never be allowed to talk about the business. And like in 20 years, just mail me a giant check and just in between, I need to pretend it's gone. So that's maybe my second one.

• 1:27:35Sam Parr?

  And by the way, I'm Colton. I'm messing with you.

• 1:27:39Shaan Puri?

  Um, also, I love the name of that little duckies. That's a great pool name. I do nickel pass three and then the other two I probably wouldn't invest in. So those are kind of like four and five. Um, all right, Ali, you're here. The crowd has beaten you up because stocks was crashing. Ali, just, is it because we're too popular? Are we just too popular? Is that what happened? Or is this something else?

• 1:28:00Sam Parr?

  And this is Ali Moyes, the founder of stocks.

• 1:28:02Shaan Puri?

  Yes.

• 1:28:03Speaker 11

  Thanks for having me, guys. Great, great show. Loved the real talk. Honestly, I think it's, it's the best real talk we've had on stocks. And you know, the comments show it. Yeah, so you guys crashed on to you. This is one of our biggest events. And we were also in the middle of like a code migration. So there were more issues at this event than the last like 50 events put together. So the screen crashed a few times, but a page refreshed it fixed it. But it will be a lot more stable going forward. So thank you for hanging in there.

• 1:28:38Shaan Puri?

  And I could attest that. So people don't know this. Me and you, we used to compete at our previous startups. So you built Stream Labs. We were building Bebo. We're both trying to build tools for live streamers on Twitch. And so I've seen you execute from, you know, first afar that we became friends kind of towards the end. But like, you're good. And when you decide to do something, you guys pull, you know, you guys are scrappy and you pull it off. And actually, when we were competing against each other, I had asked, I told Michael Birch, who was the founder of the original Bebo, and he was our investor. I said, yeah, there's this company Stream Labs out there. He was like, who's behind it? And I told him your name. He goes, I know these guys. You used to have some company called Peanut something.

• 1:29:19Shaan Puri?

  And he's like, oh, these guys, these guys are like, you know, they always just find like the thing that people want. And he was basically described as very scrappy entrepreneurs who will just like, kind of like, you'll never die and you'll like, kind of just keep iterating until you find this like hook that people want. And then you'll like, go for it. We would go for it with like full force. Is that an accurate?

• 1:29:38Speaker 11

  Thank you. Thank you. You are too kind, Sean. I have a lot of respect for what you did as well. Amazing products.

• 1:29:45Shaan Puri?

  And you guys kicked our ass for what it's worth. I feel like the, in the end, we were competing with you guys, but it really, you guys kicked our ass.

• 1:29:51Speaker 11

  Oh, no, it's, it's great. I mean, I have a lot of respect for you and, you know, what you've done and Birch as well. But amazing, amazing event today, guys. It's just, our team has been loving it. The chat's been loving it. I think Sam asked, everyone, should we do it again? Seems like. It seems like the chat is really into it. Yes.

• 1:30:15Sam Parr?

  Dude, so on the podcast yesterday, we talked about this company called Stake and they're like an online crypto gambling website and they basically give Drake a certain amount of money, like $10 million a month in order to gamble, $20 million a month in order to gamble on the website and he tweets about it and people come and watch him gamble and they give him free house money to play with in order to attract more users. So

• 1:30:40Speaker 11

  We'll take, this is a gambling, this is a gambling website?

• 1:30:44Sam Parr?

  It's called stake.com. Yeah, it's awesome. So it's really effective for that company.

• 1:30:51Speaker 11

  Is this a hint here? Do we need to set up like house money for you guys?

• 1:30:55Shaan Puri?

  Yeah, exactly.

• 1:30:56Sam Parr?

  Okay, yes. I think that you give us each like 10 or 20 grand to invest in different startups.

• 1:31:01Shaan Puri?

  And by the way, we will invest random ass influencers and also so we'll go get, you know, we'll get Jake Paul in here. We'll just go get a bunch of like other famous peoples to be our friend of the house and just give us a house budget to go invest in startups.

• 1:31:14Speaker 11

  You know, this is, this is actually not a half joke, half idea, but this is actually not a terrible idea. This is, so we have

• 1:31:25Sam Parr?

  Don't, don't, don't, don't assume smiling means a joke. I am not joking. I'm being dead serious. We should do this.

• 1:31:31Speaker 11

  So, uh, so the way we could do it is we, we, we have a small fund. It's called the Best of Stonks Fund and we do write checks into interesting startups, particularly high traction or, or great co-investors, um, similar to what you guys look for. So what we could do is for your next event, we could each give you, um, one, one check. So you pick your one favorite startup out of the five or so that bitch at your next event and, and we'll write that.

• 1:32:01Sam Parr?

  Yeah, but I want, uh, we, we want stakes in it, bro.

• 1:32:05Speaker 11

  Ah, okay, so that's that's a little more work. I have to figure it out. Let me get back to you. Maybe, maybe we can give you some carry on that.

• 1:32:15Sam Parr?

  Or yeah, that would be fine.

• 1:32:16Speaker 11

  Okay.

• 1:32:17Sam Parr?

  That'd be cool.

• 1:32:18Shaan Puri?

  All right, so also people will need to know that Ali Moyes is not the same as Moyes Ali, the other guest on our podcast all the time.

• 1:32:27Sam Parr?

  Did I call Moyes Ali?

• 1:32:28Shaan Puri?

  No, no, no, you said it right, but people in the chat are like, wait, is this the deodorant guy? It's like, no, there's, there's Moyes Ali, that's the deodorant guy, there's Ali Moyes, that's the stocks guy, so.

• 1:32:36Speaker 11

  I'm not an investing guy, not the deodorant guy.

• 1:32:38Shaan Puri?

  You gotta be sick of that, I have to assume.

• 1:32:42Speaker 11

  Uh, you know, it's fine, it's, it's more followers for both of us, people, we confuse all our followers. It's great.

• 1:32:49Shaan Puri?

  That's amazing, okay, and also we've been doing this bookshelf meme this whole time. Get us a book off the shelf there, something that has helped, you've sold a company for over a hundred million dollars, I believe. And so, so you read books and you've had success, go give us a book off that shelf there that you will recommend to the crowd, something that you think has helped you.

• 1:33:10Speaker 11

  Um, I think.

• 1:33:11Shaan Puri?

  Bring it over, go grab the book.

• 1:33:13Speaker 11

  Okay, okay.

• 1:33:16Sam Parr?

  Dude, he's got a nice house, does he live in San Francisco?

• 1:33:18Shaan Puri?

  That was actually my test to just see if he's wearing only underwear on a lot, on a, on Zooms. And no, he passed, he's wearing, wearing shorts. If you ask me to get up right now, you might be, you know, this, this stream might, might be rated, you know, PG 13 at least.

• 1:33:32Sam Parr?

  Are you wearing only underwear right now?

• 1:33:34Shaan Puri?

  I'm wearing my Jambi's, which are, which are, are more than underwear.

• 1:33:39Speaker 11

  Okay, so this, this is what I'm reading right now.

• 1:33:41Sam Parr?

  I have the same one.

• 1:33:42Speaker 11

  It's a dense read, but um, hu- huge fan.

• 1:33:46Sam Parr?

  So it looks like, I've actually bought this as well. So it's a compilation of night, from 1964, I think, up until 2010, or I forget the year, of every single one of Warren Buffett's annual letters. And what you'll notice, I actually analyzed this, his words per sentence actually gets shorter and shorter each year. And I would argue that's because he's becoming a better writer. And what's really interesting about that book is he explains like really complicated topics, like GEICO car insurance and incredibly easy to understand ways. So I think that's a good book to read.

• 1:34:24Shaan Puri?

  That's cool. Connor in the chat goes, "You picked the heaviest book he has. Power move." I agree. Absolute alpha move of you just now to go pull a 36-pound book off the shop. I appreciate that.

• 1:34:37Sam Parr?

  All right. Well, Ollie, thanks for help. Tell your boy John Hancock and the rest of the team, "Thanks for making this happen. This was awesome." Sean, I guess we'll do this again. This was pretty good. I think we had a little Kinks workout, but it's pretty good.

• 1:34:51Shaan Puri?

  Yeah, let us know. Tweet at us if you're here live or if you listen to the pod. Tweet at us if you want us to do more of these or if this should be a one-time thing.