#176 with Codie Sanchez - Buying Distressed Assets, Real Estate for Cheap & How to Network Like a Pro

Codie Sanchez (@Codie_Sanchez) joins Shaan (@ShaanVP) and Sam (@TheSamParr) for this brainstorm. Codie is all about businesses that cashflowing right away. She talks everything from buying distressed businesses to modular homes to buying real estate for pennies on the dollar. She doesn't shy away from controversial thoughts either: she lays out why angel investing is dumb and why public stock investing is as well. We end the episode with some great stories on "how to collect people" (basically network like a champ) and what financial freedom really means. --------- * Want to be featured in a future episode? Drop your question/comment/criticism/love here: https://www.mfmpod.com/p/hotline/ * Support the pod by spreading the word, become a referrer here: https://refer.fm/million * Have you joined our private Facebook group yet? Go to https://www.facebook.com/groups/ourfirstmillion and join thousands of other entrepreneurs and founders scheming up ideas. --------- Show notes: * (0:38) The guys recap the Balaji podcast * (5:08) Codie explains what she does and how she got there * (15:03) Owning mailing centers & pack and ships * (21:12) Buying distressed assets for $0 * (23:54) The big ROI on tiny homes * (28:44) Codie's controversial thoughts * (37:16) Buying RE at auction * (43:01) How to collect cool people * (54:15) How Shaan and Codie view financial freedom

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

• 0:00Speaker 00

  Most people should not be out there trying to build the next Facebook. And I think it's kind of fucked up that a lot of people try to tell people that's what they should do. Most people want Maslow's hierarchy of needs, right? You want your family taken care of, you want food on the table, you want to be able to do the shit you want to do on the weekends and that's it. And so I like the portfolio actually better of a portfolio of small bets. I think of buying businesses a lot like I think about buying stocks.

• 0:36Shaan Puri?

  Sam, you showed up. I thought, uh, I thought you were too hungover from last night's pod that went till two in the morning to show up today.

• 0:45Sam Parr?

  Dude, it went later for me. I mean, I didn't go to bed till four. What time did you, what time, what time was it over for you?

• 0:51Shaan Puri?

  It ended, but my brain didn't turn off. So like, I don't even know if I slept last night. I straight, so we, so Cody, we had, um, Bology on the pod yesterday and, uh, I don't know if you know him. Kind of a real smart, smart dude. And he definitely, um, you know, has like a ton of different ideas and thoughts. And he's like super, super smart on a math perspective, science, uh, you know, technically for computer science. And so he was, you know, rattling off a bunch of interesting things. But when he left and I'm going to sleep and it's just, you know, you know, I'm sitting there, I'm in bed, my dog's in the bed and like, my mind is like making up, it was straight up, I was just making up like scientific theories in its head. Like, you know, that state where you're dreaming, but you're, you're like lucid dreaming or whatever. You're like, kind of like half asleep.

• 1:36Shaan Puri?

  And so I was half asleep, but my mind was like, oh, but then the vector has to go to the scaler and then it has to, you know, the order of magnitude. And I was like, then I'd wake up, but what the fuck am I talking, like, what the fuck is going through my head? This is not even, this is gibberish, this is scientific gibberish. And that straight up happened like the whole night. So, uh, not a great.

• 1:51Speaker 00

  Be prepared to be underwhelmed in comparison to him today, I think is the moral of the story.

• 1:59Sam Parr?

  Well, he uh, he's just like, like, we've had a, I think we've had one other person on the podcast. Like, I guess Michael Saylor could be this, but I, I for sure think that, uh, Rahul from Superhuman was like this. But there's like these, a handful of people who we've talked to and you know how people say like, oh, that person's a genius. They're not, they don't really mean it, but if we define genius as just like a certain IQ, I would bet a lot of money that, that he was the highest IQ person that I've ever had a conversation with, and it was very obvious. And he actually was quite, he tried really hard to hide it in that he tried to act nice and friendly. And there was times where he was like, sorry, you guys probably don't understand that.

• 2:40Sam Parr?

  Let me try to re-explain it. And that was, that was actually pretty cool, but he just, his, he's just smarter than me. Like his, he's, his oven just burns hotter and I, there's nothing I could do to try to understand that. Like, I remember one time, I, I didn't want to embarrass Sean, but like biology was telling something and he used, he used math metaphor. He's like, the vector.

• 3:01Shaan Puri?

  He's like, what I tried to find is the dot product between me and this, and I was like, dot product. I remember that like in eighth grade, I, I heard this phrase 15 years ago, didn't understand it then, never ever thought about it again. And then he's referencing it for like, the way he thinks about something. He's like, you know, so I tried to find the dot product. And I was like, fuck, I don't know what that means.

• 3:19Sam Parr?

  But, but he went, like, he went from math, so he was talking about math to talk about an idea. And then he moved to like, uh, this one, like some type of chemistry.

• 3:28Shaan Puri?

  Battle of the Bolge.

• 3:28Sam Parr?

  And then he went to the Battle of the Bolge and he goes to Sean, he goes, Sean, you know, like, you know, like it's a Battle of the Bolge, right? Um, and Sean was like, yeah. And he's, I don't think you knew the Battle of the Bolge.

• 3:38Shaan Puri?

  World War IV, right?

• 3:42Sam Parr?

  Anyway, it was an interesting podcast, but this, this isn't about him, this is about you.

• 3:46Speaker 00

  That's what Wikipedia is for. Sometimes I'm kind of glad I'm not like that, honestly. Could you imagine how, like, you felt like that last night, Sean? Could you imagine being in his head every day or at like a dinner with normal people? He probably wants to kill himself.

• 4:00Shaan Puri?

  Yeah, we were, we even asked him about that stuff. We were like, you know, we asked a whole bunch of questions that were like, I hope not even like condescending, but we're kind of like, were you always like this? And like, what is, what did your family think? Like, were you like an oddball to them? Or are they like, was this like totally normal? Because I've never met somebody like you. So I want to know, like, what's your life like? What do you do for fun? Like, you know, how does this all work? And so we asked him a bunch of goofy questions like that. Actually, unfortunately, the best, the very best part was at the end, after the recording ended, and we just kind of, after a three and a half hour podcast, we then shot the shit for like 30 minutes, and it was great. And his guard was totally down. And that was awesome. And then Sam started helping him with his newsletter tips, and he was like, taking notes. And he was like, oh, this is, this is great. This is awesome stuff. And like, that was ironically

• 4:44Shaan Puri?

  the best and simplest part of the podcast. And then we had like, three and a half hours of like, good stuff, but in a, I mean, the way you said it, his oven burns hotter than ours. And so, you know, I didn't feel like we were able to really add too much to the conversation or really like, steer it, because I was like, riding a Bronco that I didn't know how to ride. Basically, it's too smart for me.

• 5:03Speaker 00

  I love that. Can't wait to hear it.

• 5:06Shaan Puri?

  Anyways, so with that out of the way, welcome to our guest, Cody's, Cody's here. So Cody, how do you, I guess, like, how do you explain yourself when you kind of introduce yourself? Because you have a newsletter, that's pretty cool, you know, this country and cash flow newsletter, you have an investment fund and business there, you have built and own businesses, I think majority share in some businesses. So like, what do you, how do you describe this jack of all trades? So, hi, I'm Cody, here's what I do. What do you say?

• 5:37Speaker 00

  Well, I think if I'm on an airplane sitting next to somebody, I usually tell them I'm a salesperson, so I don't have to talk too much. But in a conversation where I was trying to impress somebody, you know, I'd probably say I'm an investor. I am a private equity investor. I run a fund that's about a couple hundred million bucks, focused on cannabis. Before that, I did emerging markets, couple billion dollars raised there. And, and now I write about all the things I wish I knew, when I was first figuring out anything to do with this green language of money. And I do that at Contrarian Thinking, and I mailed the two. But I think these days, that's not that weird. There's a ton of VCs, not so many PE investors out there, probably, that write about investing and share their ideas. And I kind of think that's probably the future in what's going, going forward.

• 6:21Sam Parr?

  You, I didn't know that. I knew that you had the newsletter, but so you have, you run a $200 million

• 6:27Speaker 00

  Well, enough on myself. There's five partners, but yeah, we have a $200 million cannabis private equity fund. We invest in companies that do like 10 to 50 million dollars in revenue, largely it's called Entourage Effect Capital. And we've invested in 67 companies thus far, some cool ones, um, you know, that you all would know. I think there's been six unicorns in there thus far. So, you know, um, you guys would maybe know GTI, Green Thumb Industries, Acreage, Canopy Growth, uh, Cure Leaf. I don't know. If you're big weed connoisseurs, you know them. And then, uh, and then we have a smaller fund that's about 20 million bucks. That's for micro PE. So that's just me and a couple of other partners' money where we buy small businesses.

• 7:10Speaker 00

  And that's if, if weed's sort of fancy and not fancy, I guess trendy, uh, then the other one are super boring and things that, you know, your, your father did when you were growing up and you didn't tell people about.

• 7:25Shaan Puri?

  And that's like, uh, give us examples. We're talking laundromats. We're talking, um, what are, what are we talking about plumbing businesses? What do you look at?

• 7:32Speaker 00

  Yeah, the, actually the first one was a plumbing deal. We started it because my uncle Eb, uh, he had a $5 million business. Let me make sure I get the numbers right. That was doing about two to three million dollars in profit and he was old, you know, seventies ish. And he was a share cropper. He grew up in a share cropping family. Didn't know anything about the business world. And when he came to retire, he didn't know anything about M and A. So instead of selling the company, he basically just wound it down. And, uh, and you know, he took a company that had two to three million dollars in profit and just, just, you know, let everybody go and, and sort of wound down the business. And I thought that was a real waste. And so, um, we realized, wait a second, there's actually like a business model here. It's called PE. I've been doing it for 12 years at Goldman and Vanguard and State Street and all these different firms.

• 8:16Speaker 00

  Why don't, why don't they apply this to these micro sized businesses, anything below three mil? And, uh, instead of us making a bunch of money for other people, we can make money for ourselves. So we ended up taking an offshoot of Eb Holmes Clonamine. You can look it up. It's in Phoenix and we bought a Another plumbing company rolled it in, sold that one. That was a little tiny company. And and then I've done it for a bunch of others. And now we own laundromats. We own a podcast production company. We own some lawn care businesses. We own a professional services business. It's in the cleaning space. So a slew of tiny, sort of boring businesses. And most of the time, I don't operate any of them. There's somebody else that's an operator in them, or we place somebody in the business.

• 8:59Shaan Puri?

  We love this model. Me and Sam both, a couple of our best friends started a kind of micro PE firm. We invested and I think have been, I don't know, Sam, I don't know how closely you track them, but we've been, I've been learning a ton as they look at all these different deals. And it just seems like there's this huge generational shift of people who are aging out of their business and need to hand it off. The kids don't want to take it over necessarily, or aren't able to, or whatever. And so basically, the boomers handing over businesses, there's just like all these businesses that are beautiful, five, fifteen million dollars a year, profitable, super steady book of business. And you can, you can buy these out of like, super reasonable multiples.

• 9:37Sam Parr?

  Yeah, it's like a sixty-five, seven-year-old mom and dad, whose kids went to a good school. And they're like, I'd rather work at Facebook than run the moving company, please. I don't want to do that. So and they're like, all right, what do we do now?

• 9:52Speaker 00

  Hundred percent.

• 9:53Sam Parr?

  And that's what these guys are buying. It's going great. Like, I get their updates. They're making a lot of money.

• 9:58Shaan Puri?

  And so can you?

• 9:59Sam Parr?

  Good for me, too.

• 10:00Shaan Puri?

  Can you, can you draw a quick line? So like, let's do a quick hop through the resume. So people, because I think where you're at now is super interesting. Anytime I meet somebody who's in a really interesting spot now, I'm like, how the hell did you get there? So you said something like Goldman, but like, without going into the details of like, I did this, and here's how it went. Just sort of like, I went to school thinking I'd do this. First job was here, second job was here, third job was here, now I'm here. Like, can you give us that?

• 10:24Speaker 00

  Yeah, the short and sweet. So I went to school totally unrelated to anything financial. I'm not really a finance nerd at the core. I started off in human trafficking and drug smuggling as a journalist, not doing it, but along the US Mexico border. So, so I was covering things like, you know, old people being left behind at the border. And, um, you know, went with a couple coyotes and actually saw what the process was like. And anyway, super young at the time, I thought I was going to change the world, realized like, ah, you know, Britney Spears shaves her head and nobody cares about these stories. So maybe there's a different way. And so anyway, uh, so moved from, uh, journalism to had my little quarter life crisis

• 11:07Speaker 00

  and decided that maybe I wanted to understand finance because my last name Sanchez, all these people's last name was Sanchez Suarez, whatever the case may be. And I was in a very different position than they were. So I was like, what's the difference? Why are they there? And I'm here and I think the only difference is green. It's not actually even that I'm American. And so went to, from there, I got recruited to go to Vanguard Accelerated Development Program. Saw a bunch of parts of finance, didn't understand any of it, but journalists, we ask a lot of questions. So it's pretty decent at that. So asked a lot of questions, got from Vanguard, they're all about passive investing, right? So create an index, that was at the very beginning ETFs, uh, and create an index and replicate and replicate and replicate. And I thought that was cool, but not that sexy or fun. So I went to Goldman and I wanted to understand active.

• 11:52Speaker 00

  How do we do IPOs? What do these alternatives look like? Is there more margin? Then went from Goldman to State Street, ran, uh, international investment business for State Street at the time and then, uh, left, did a JV with a company called First Trust and built out their international portion. So I grew the business to a couple billion in Latin America and, uh, and basically we sold products to big pension sovereign wealth funds, et cetera. And then after that business, I was ready to exit myriad of reasons and looking for the next emerging markets. Uh, and I started invested in cannabis a few years back, but real quiet, wasn't sure my mom would approve and, uh, and then went full in as a partner into EEC.

• 12:36Sam Parr?

  What's your, um, um, what's your heritage? You said that you're, are you, you were talking about the.

• 12:41Speaker 00

  Yeah. So my father's half, so I'm half Spanish, half Mexican.

• 12:45Sam Parr?

  Are you Catholic?

• 12:46Speaker 00

  Yes.

• 12:48Sam Parr?

  Me too. So a Mexican Catholic mother probably wasn't a fan of

• 12:53Speaker 00

  Oh, yeah, she was thrilled. Babies, Babies of Weed financier. She was really excited about it. Just making daddy proud. But, you know, I think once we kind of understood, I mean, here's my pitch on cannabis. But once we kind of understood the, you know, psychoactive portion of it and the benefits for those who are overusing opioids. Like, I got her around to it, but certainly upfront, she was not thrilled about that. But that's when you know, right? When people think you're a little crazy for doing something, there's usually at least some opportunity left. Otherwise, all the smart people would have moved first. And I'm not smarter than anybody else. I'm just better at maybe finding some early emerging markets people won't go into yet.

• 13:29Shaan Puri?

  And I thought you would be a great guest for two reasons. A, I went on your thing and you were so prepared. I'm not anywhere near as prepared for this as you were for me, unfortunately, but I knew enough, which was like, oh, she's great at talking. And which is like half the battle. And then the other half is like, oh, wait, she's like wicked smart with a bunch of industries that I think people don't know a ton about. So micro PE, I know there's a lot of people interested, but for most people, it's a little bit daunting. They don't understand how do I identify the businesses? How do you value them? How do you buy them? What do you do after you buy them? That sort of thing. And then same thing with cannabis. People kind of know it's a big market, but don't spend, you know, if you're not spending every day in that world, you don't know how it's going. How, what's, what's been growing. And so you sent us a bunch of things.

• 14:13Shaan Puri?

  So you sent us ideas on the micro PE side. You sent us ideas on the cannabis side. And then you sent us some controversial thoughts. Sam, where do you want to start of those three?

• 14:24Sam Parr?

  The ideas, particularly the, she posted something in trends about mailbox, mailboxes, which, so like, you just have like

• 14:32Sam Parr?

  five or eight different things that I think are interesting. They're not like huge home runs, but they're small business entrepreneur, like stuff, shit that like an immigrant who came from nothing like would start. And then eventually did it for 30 years and they would have like a fucking empire.

• 14:48Shaan Puri?

  Let's rapid, let's rapid fire them. And here's how we'll do it. You sent us this bullet point list. I'm just going to say the phrase and you'd be like, okay, so here's what I'm thinking. And then if we just want to switch, if I'm like, okay, that's great. I'm just going to throw another one at you and then you go from there. I think you'll be able to volley these pretty well. All right. So let's do that one. Mailbox money. What are you, what are you thinking about here?

• 15:06Speaker 00

  So this is pack and ship centers. So basically, think FedEx, UPS, except get rid of the franchise fees because that's 25% of your profit off the top. And instead, you just put, you know, Sam and John's shipping center on the front of it. And what this is that I didn't realize, my friend Lisa did it. I'm always curious for my people who make money in ways that are repeatable, since I'm not smart enough, like Balaji or whatever his name is, to create the next Tesla. Instead, I just want a bunch of stuff that cash flows now. And so with this, you know how everybody's obsessed with storage units? Like, everybody builds these storage centers and that's been like the sexy thing?

• 15:43Shaan Puri?

  Self-storage.

• 15:44Speaker 00

  Right. And that's really just a riff on everybody was obsessed with multifamily and apartment beforehand. They're like going smaller and smaller and smaller, but still trying to get as much profit as possible. Well, that's what pack and ships are. So essentially, the money is not in the taping of boxes and the stuffing of stuffing to make sure stuff doesn't break. It's actually in the little mailboxes in the front.

• 16:06Shaan Puri?

  Oh, I was gonna ask you, what do you think of this P.O. Box rental? So first, I like the trend, which is you're buying a box of real estate and you want like kind of these low operation rental units. So, okay, self-storage, but now you shrink the self-storage unit instead of being, you know, 100 square foot little room, you're shrinking it down into a one-square-foot box that you're renting out for 20 bucks. And what you were saying, so let's just do the math real quick on this. You're saying 200 boxes in a location, roughly? Is that right?

• 16:36Speaker 00

  200 would be what you don't want. That's UPS, FedEx. Go 1,000.

• 16:39Shaan Puri?

  Okay. Okay, okay, gotcha. Okay, now the math works. So 1,000 boxes, average $15 a month of renting out the P.O. Boxes. And how do you get customers to, like, what does she do to get, what does your friend Lisa do to get customers? How does she acquire these P.O. Box tenants?

• 16:55Speaker 00

  Well, the smartest way, what I talked to her when we were doing, she built the first one. That took a year and a half to become profitable because she had to do what you were just talking about. It's not really that complex of a business. It's ads, so PPC. It's dropping actual hard mailings in the surrounding neighborhood. It's things like, she does like a book setup out front, little pop-ups for the neighborhood where you can like, you know, free packing if you ship this day, all that kind of stuff. Those squiggly arm things, you know, that you put outside of a new unit, all that stuff. And then she, but, but the second store I told her to buy. And so what she did is went out and bought an already an existing store that had customers and then just upsold them. And that's a much easier way to do it.

• 17:40Speaker 00

  And so you buy the store for about two to three X profit. Her second store she got for about 1.5 X retiring owner. And then she was able to take that business and sort of double the revenue for that one.

• 17:51Shaan Puri?

  I like this idea. I actually might steal this idea because I just rented out a big warehouse for my wife's business. And one thing we could do is just put a bunch of these mailboxes in, into that space and just actually offer this as a sort of a simple way to take advantage of a small footprint of real estate.

• 18:12Speaker 00

  Yeah, I think you have to decide what type of human you are. Like if you are the type of human that has a capability to build up a really big business, and that's what you in fact want to be a CEO of a hustle or to be a CEO of an even bigger company, then I think the ROI on that is potentially more interesting long term. You're not going to get the same type of multiples with these tiny businesses. But here's the thing, most people are not like the three of us. And I don't even know if we'd all be in the same category. We're all different in the way we've built things. Most people should not be out there trying to build the next Facebook. And I think it's kind of fucked up that a lot of people try to tell people that's what they should do. Most people want Maslow's hierarchy of needs, right? You want your family taken care of. You want food on the table.

• 18:55Speaker 00

  You want to be able to do the shit you want to do on the weekends and that's it. And so I like the portfolio actually better of a portfolio of small bets. I think of buying businesses a lot like I think about buying stocks. So how can I get a little portfolio of them with somebody running or operating them? So then my risk is diversified. And you're right, it takes more time. But if what you're really going for is I want to make, you know, 200,000, 300,000, 500,000, a million bucks a year, and that that is my goal, not to change the world, there's so many better ways to do it than do a startup, in my opinion.

• 19:29Shaan Puri?

  Yeah, I'm a hundred percent with you on that. I think the build versus, build versus buy is so slanted towards build because building sounds sexy, building sounds like virtuous, it's what the media talks about, and.

• 19:44Shaan Puri?

  It's really unfortunate because I know a lot of people that would have been really happy with 250K a year of profits and low maintenance, low headache. And unfortunately, they get sucked into either one of two paths. It's like, I guess I'll do the startup thing because I want to be entrepreneur. I want to be kind of my own boss. So then I gotta like do this from scratch, find product market fit. Like, damn, that's hard. And the other path is like, oh, that's, that sounds really hard. I'm just going to stick at this job and, and you know, I'll be an employee for the next 25 years and never really get that freedom because I'm sort of on their schedule. I'm basically renting my time out to this company. And so the buy path versus build or join, I think buy gets criminally underrated right now. But I think it's changing. Like we have Andrew Wilkinson on the podcast a lot.

• 20:29Shaan Puri?

  One of the reasons he's so popular is that when he says what he does, there's a hell of a lot of people out there who are like, shit, I want to do that.

• 20:36Shaan Puri?

  That sounds like an easier path than the one I'm on right now. And so I think it's quite appealing.

• 20:40Speaker 00

  Yeah.

• 20:41Shaan Puri?

  Sam, you want to jump to one of these other ones? That sounds interesting to you. We got, I see a bunch that I know you'd like. Tiny homes, buying distressed assets for $0, laundromats. Which one do you want to do?

• 20:52Shaan Puri?

  Oh, no. We gotta tell you, Sam, the audio's gone again.

• 21:04Shaan Puri?

  Sam has pieced out. The technical difficulties have overcome him and he cannot continue on. He is, he is out of the game. Okay, I'll do one. So I want to talk about just buying distressed assets for $0. Is this something you've done or why did you bring this up on the list?

• 21:19Speaker 00

  Yeah, so this one is one I've done. And actually, there's an example of it. I'll give you the actual example. So I have a friend, Brittany, who owns a bunch of gyms and not a bunch, she owns two. And they're like, you know, like the gyms that a lot of women go to where they have, you know, set classes and, you know, they all get in and work together. It's kind of like women's CrossFit, but not with big weights. Anyway, so she owns a couple of those.

• 21:42Shaan Puri?

  Like Shapes without the franchise.

• 21:43Speaker 00

  Exactly, exactly. So she was telling me that a bunch of her friends, their businesses, Pilates Studios, Bar, whatever, were going out of business, right? During the pandemic. And what was fascinating to me is she was like, so I'm buying some equipment, you know, I feel bad for them, I'm helping them out. I'm like, no, no, no, no, no. The way we gotta do this is, think about those businesses, they're going under and they're worth now zero to the market, but they have value. So, you know, they're not getting anything out of the client roster that they have, all the goodwill that they've built up. So what we decided to do was reach out to some of these gym owners and basically say, hey, you know, I'm really sorry, I know you're going through this terrible time, what if we could help annuitize you a little bit, where you could get some revenue off of the

• 22:28Speaker 00

  business that you're about to close for zero, and instead, we can do a rev share. And so, I own a business right now, we'll transition over your clients from your business to mine, very carefully, very thoughtfully, but give them a new home, and then for every client that we bring over from you, I'll pay you out on it for a year, or I'll pay you out on it for six months at X amount and 24 months at Y amount, however you want to structure it. But this way, you actually make money while you're closing, your clients have a new house, and we have new clients and we can serve them and we're friends and you like me anyway. And so, this business, what, to me, what's fascinating is nobody's doing this, that I know of. Like, if I owned any business, I would be out there right now

• 23:11Speaker 00

  for every business closing on Yelp, 60% of the businesses on Yelp that closed temporarily, closed permanently. So, I would be out there right now going after every one of their client lists, even if they were unrelated, and doing discounts and coupon codes, giving a rev share to the owner who probably could use it, and taking their client base. And that's how I would buy distressed assets, I wouldn't spend a dime.

• 23:30Shaan Puri?

  I love that, I think that's great. And it's basically, you're picking up the assets and none of the liabilities. So, you're not buying the business and then having to rent, and then, you know, having to bring that business back up. You're basically saying, what is the, what is remaining as an asset to this business? And it's the customer Rolodex, and I think that's a, that's a great one, that costs zero out of pocket from day one, it's just profit share, you know, if, if a customer does come on over to you. So, I think that's a great one. Let's talk about modular homes, or tiny homes, I think you have a couple of ideas on this. So, you have one?

• 24:00Speaker 00

  I do. Yeah, we bought a modular home, which I didn't even know, do you know there's a difference between manufactured and a modular home? There's all this weird terminology.

• 24:09Shaan Puri?

  No, like I actually, this is what I was gonna ask you is like, I thought a manufactured home is a modular home. No, they're two different things.

• 24:15Speaker 00

  Yeah, exactly. Yeah, this, I guess, so manufactured home basically means, it's what we think about like stereotypically, right? It's a, it's a trailer home, basically. All the difference is, is that there's no foundation set. So you could pick that bad boy up and you can move it, right? That's manufactured. Modular is that it's built in pieces, which is modular, what that means, but it has a foundation. So at the end of the day, there's really no difference between a, what is called a stick-built home, a house that probably you're living in, that I live in right now, and this modular home. But the crazy part is, is, well, one, we've all seen these cool modular homes all over the place popping up, but I was surprised. I'm like, they don't really make sense, not at

• 24:56Speaker 00

  scale. They're not that much cheaper, and they're not that much faster when you just drop one on your property. And I did a bunch of research, asked a bunch of people, they're kind of sexy, but they're not that much cheaper. But when they are cheaper is when you do them at scale. And I was, I was surprised that there weren't any developments that did this. And so I started scouring the country, found a few, one in Park City, and bought there. And the numbers were amazing, and I bought it, so I know they're real. We bought our house for $900,000 in Park City, and on an acre, 3,000 square feet. The average

• 25:36Speaker 00

  price, average or median, is like $2.5 million in Park City. So the cost that they were able to save was so amazing, and they didn't pass it on to the user fully. I think they weren't sure if we all were gonna actually buy into this, but the houses are super sick. And I think that's a model. If I was a developer, I'd be using those all day long, and, and I'd probably buy a modular housing company and then use it, don't you think?

• 26:05Shaan Puri?

  Right. Yeah. And so when you look at that home today, can you tell basically this is anything but a normal home? Like, is it aesthetically different? Once, if you didn't know coming in?

• 26:15Speaker 00

  No. So I'll drop you the link right now. I'm not going to say where it is, just in case anybody wants to come yell at me about something stupid I say online. But I'll drop you the link and you can see the difference. But no, it's super sweet looking. So it's, it's kind of the open concept, big windows, whatever the case may be. And, and you can't tell the difference. The only difference really is that the turnaround time. So we bought this in December of last year, or January, February, I don't know. And it'll be done by July. And so it hadn't been built at all.

• 26:49Shaan Puri?

  Are you gonna add to it? Like, are you gonna add more modules to it?

• 26:54Speaker 00

  So I'm gonna add a back office, like, module. And then what we did is we got like five or six of our friends to buy in the same community. And they're cool looking. And so I think I'm gonna do some event or something and utilize the four or five of them. And then you could have it as a tax write off, because it'll essentially be like a little business.

• 27:14Shaan Puri?

  Okay, this house is sick. And so the company that's doing the development there, the company that's doing the development here, they are not the actual manufacturer. So there's three layers, right? There's the manufacturing level. Then there's going to be probably some delivery layer. And then there's the developer who's doing a development marketing that. And then there's like, kind of the individual home buyer beyond that. So have you looked at the manufacturers of this?

• 27:36Speaker 00

  Yeah. So that's where this one's interesting. The builder and the manufacturer are actually in this deal together. So they do own the modular company, and at least a portion of it. And then the builder is one that's built this in a couple other places. They also have another location that I think is cool, and also could work at scale, which is modular tiny hotel rooms, essentially. And I believe that's in Jackson Hole, Wyoming. And the economics are just so fascinating, because, you know, our modular home will be built in less than six months. It's about a third of the cost, the square footage, if you break out by square. Footage, it's about a third of the cost. And then the part that's interesting is in these

• 28:18Speaker 00

  locations where the weather's terrible, you know, and you can't break ground very often, they they build it all in a warehouse. So it's fine. They lay the foundations all in one period of time and then boom, boom, boom, boom, boom, do all throw all the houses up as opposed to everybody else in Park City has to wait like, you know, two years or something like that. So we'll see. But so far, so good.

• 28:37Shaan Puri?

  Okay, this is pretty sick. I like this one. I'm gonna jump to more because I want to see what these other ones are all about. So talk to me a little bit about, let's do a couple of the controversial thoughts. I'm gonna rip through them pretty quickly and and so let's do the first one. Number one, angel investing is largely dumb.

• 28:56Speaker 00

  Is that painful? Because we both are angel investors too. And you have a rolling

• 29:00Shaan Puri?

  No, I actually, I actually say this, I say this often, and people are like, you have a rolling fun. And I'm like, Yeah, I don't, of all my investment types that I do, this is, I would say, the worst one. But I think it's still good and fun. And I do it anyways. But I have like, two or three better ones than I do besides this.

• 29:16Speaker 00

  Yeah. So I think, you know, one of my good friends name is Justin Donald. And we're both pretty obsessed with deal structuring. One of the biggest things I have a problem with with angel investing is it's it's too fun. It's like gambling, right? Like, you get excited about the founders. And guess what? Founders are charismatic. That's how they raise millions of dollars. And so you end up getting sold, and it's not their fault. And then, you know, there's fraud. And, you know, I wrote this whole piece about this one guy that we lost two million dollars with, because he just was super egotistical, and like, big images of himself on the wall, like, all this stuff later that I got added to my due diligence questionnaire of like, how many images of yourself do you have in your office? But but the thing with angel investing is, you

• 30:00Speaker 00

  know this, you need like, 20, 30, 40 deals for every one to four that are going to go through. And so I think that the other thing that we do a disservice is telling people to invest in angel early on. Once you've made a few million dollars, and I mean that literally, then I think, go into angel investing. Or if you're on a path where you're making really good money, and you've made at least half a million, a million bucks, then I Think you can start angel investing, but until then, you know, let other people lose money and learn from it. You said it like you were like, take a, take a, you know, DocuSign image of every deal you want to do. Write down how you do it, timestamp it so people can see. And then decide later on how good you are at it without burning through a few tens of thousands of dollars.

• 30:44Shaan Puri?

  Yeah, exactly. Okay. So I have a bunch more thoughts there, but I largely agree with you. And I would say like, it's one of those, here's my red flag is in order to talk, in order to justify angel investing, you have to give a blend of reasons. It's like, well, it's really fun. I like learning about the, you know, the future and the market, and these are all true things, by the way, so it is fun. You do learn a shit ton, so it's like an education. You can make great money if it pans out as you assemble your basket, you know, you should over a, you know, you should, you know, be netting, you know, a 20% plus IRR. It just takes a long time. It's liquid.

• 31:22Shaan Puri?

  And it's like, not too much work because you're largely investing in your network that you've already built for 10 years. Like, that's kind of the thing. And so there's like this blended reason. And anytime you have a blended reason, it really means that there's not one really great reason to do something. And so those are always like, you know, suboptimal choices, I find for myself at least, whenever I have to come up with a blend. And so, and I, and because I tell everybody this around me, whenever they hear me justifying something with a blended reason, they're like, oh, interesting. So that's a pretty big blend. And I'm like, oh yeah, we should just not do it. Never mind, take it all back. Because I'm giving you this huge list and instead of just saying, we should do this because of X, right? Like, we should invest in this business because it's growing like, like a weed.

• 32:05Shaan Puri?

  And if it wins, it's going to be this big. That I can get behind. And some angel investors do follow that, but the act of angel investing as like a job or a hobby is. Is like, it's more like when you describe playing basketball with your friends, like, oh, it's great. I get to hang out with my friends. I get a good run in. I get exercise. You know, I, you know, it's, I get outdoors. It's like you're giving this blended reason for doing the, the, the really fun thing you just really want to do. And you're justifying it. But the reality is you just want to do it and your brain comes up with reasons afterwards.

• 32:37Speaker 00

  I think that's exactly right. Yeah. The only caveat I have to that is if you can go later stage deals, which now you can do with a lot of the late-stage angelist syndicates, or if you can structure debt. Like, if you can figure out a way where you start earning interest day one on a startup that actually has, you know, it's a little bit later stage, and so it has some revenues, or you could, you know, get into a debt deal that's on some of its, you know, factoring of the invoices it has, like, there's, you know, people always think of equity with startups, but lots of startups prefer debt. So do debt with like a equity warrant kicker on it, and you can actually make money from day one and then have some equity upside. And that, I think, is interesting. But, you know, throw the Y Combinator term sheet out the window, because it's not going to be on that.

• 33:24Shaan Puri?

  Right. And all that being said, I'm still gonna angel vest, because it's, because it is fun. And it's, you know, it's a hobby that makes money. So, okay, so let's do another one. Public market, public market investing, also kind of dumb. Talk to me there.

• 33:38Speaker 00

  Well, this one I like to talk about a lot with big investors, because if you look at the Forbes 100 list, there is not one person on there who made their money from just investing in the stock market. And then this is where people are like, Cody, Warren Buffett, Carl, Carl Icahn. And it's like, I remember I was at Goldman in 2009, when, do you remember Buffett did the deal to invest a bunch of money in Goldman to stabilize it? Yeah. So, I was there then, and it was not a public market deal. Warren didn't go out to the street and buy a bunch of stock. He had a ton of warrants and options on top of it. It was a total backroom deal. And that's the only reason that he did it, because he basically had this huge asymmetric risk, right, where he had a bunch more upside than he had downside. And that's the same thing with Icahn, who tries to affect the outcome.

• 34:23Speaker 00

  So, my point with people, especially these days, with like GameStop and all the madness and stock investing, is like, if you don't have an unfair advantage, if you can't like, write down why specifically you're going to win instead of somebody else, you should be really careful speculating on stocks, because the big boys don't really do it.

• 34:42Shaan Puri?

  Uh, yeah, I have a cousin who runs a hedge fund. And when he told me kind of like all the different things that they have at their disposal, I was like, oh, okay, I'm, I'm coming into a gunfight with like a fingernail. That's kind of like how, how lopsided it is. And I, so, you know, so, so that being said, again, I think this is important to say skin in the game here. Do you own any public equities? And so despite this, do you just do like Vanguard? Do you just say, oh, here's 10 companies I believe in? I'm going to do that. Or what do you do?

• 35:12Speaker 00

  Yeah, I don't hold any individual stocks for speculation purposes. I invest in indices and I'm not saying this is right or I'm some guru. I'm just saying, I don't think I'm smart enough to beat the market. And so I don't play games where I don't like the rules. I'd rather write my own rules if at all possible. So I go, you know, equity indices, Vanguard, you know, whatever the case may be. I like Vanguard the best. And then I go mutual funds on alternatives, private equity REITs where you can actually have an unfair advantage. But I don't speculate on any individual stock. Now, I don't, I mean, would I own Apple, Amazon, Facebook, whatever? Would I make a play on Twitter if I thought that might be fun? Yeah, maybe. But I think there's so many easier ways to make money with private market investing

• 35:57Speaker 00

  and buying businesses as opposed to having to deal with the irrationality of the crowds. Right? I mean, do fundamentals really matter in today's world? Or is it whoever has the best IR and doesn't have some crazy thing the CEO said or done?

• 36:14Shaan Puri?

  Right. Uh, yeah, exactly. Have you ever heard this term Keynesian beauty contest?

• 36:19Speaker 00

  No, what is that?

• 36:23Shaan Puri?

  So, uh, named after, I think, the economist Keynes. And basically, the, the idea is that this is how the stock market works. So a Keynesian beauty contest is where you don't just, uh, it's a normal beauty contest. You sort of just would assess, uh, let's say the contestant that's, that's on the stage. But in this case, uh, the way the stock market works is it's not you assessing the true beauty of the thing. It's you guessing what other people will value it at, who are also guessing what other people will value it at. And so it's sort of, is this like extreme, you get these like really warped things happen because everybody is not betting on the thing. They're betting on what the other people will do about the thing. And everybody knows that everybody's betting on what the other people will, will value the thing at. And so you get these like really crazy, um,

• 37:08Shaan Puri?

  Sort of out of whack things that aren't value investing at its core.

• 37:12Speaker 00

  Yeah, I totally, totally agree.

• 37:15Shaan Puri?

  Let's do a couple more. So buying real estate at auction, so a way to buy real estate at a discount. Talk to me about this one. I've never done this.

• 37:22Speaker 00

  Yeah, this one's fascinating. So for instance, let's use Texas. Well, Sam's in Texas, right? But I like Texas because they do this thing where they actually sell real estate at auction on the courthouse steps of each municipality or city previous to it going on Zillow or Redfin or whatever the case may be. Like, we've all seen those.

• 37:43Shaan Puri?

  Are these foreclosed, are these foreclosed properties that you, that you get there? Or what, what type of properties are you getting?

• 37:49Speaker 00

  Yes. So foreclosed is really when it's listed on Zillow and Redfin. And so that's sort of like this post auction step. That's when most of us see foreclosed properties, right? So you're like, oh, no, I know how to buy foreclosed. I can go on Redfin if it says foreclosed, I can buy it. Well, prior to that, you have auctions, which actually are the bank auctions of bankrupt properties or foreclosed properties, but you get it before the street does. And then you can even front run that one step further, which is there's a list of properties that are going to go into bankruptcy or foreclosure. And the list in Texas, you can look it up right now. It's called Roddy's List, R O D D Y S. And on Roddy's List, you buy this list, it's cheap, like a couple hundred bucks,

• 38:32Speaker 00

  and you can get the list of all the properties that are about to go foreclosed. And then you can door knock. You can go knock on the door because even though it sounds predatory, it's actually not, because if you go knock on the door and tell this person, hey, I'll give you $200,000 for the house that you are in foreclosure because you owe 50, that actually gets them out of bank foreclosure and gives them the extra money that the bank was going to write off for them. So this is buying on the auction shops. And I did it with a friend of mine, Aaron Amichesdegi, who's a stud at it. And it's wild, millions of dollars of transactions in cashier's checks happen same day on the courthouse steps.

• 39:13Shaan Puri?

  Why can't somebody bring that online? So why is nobody built basically the tech platform that says, great, we go to all the court steps and then we, you know, sort of flash list these things and you can sit at your lap. I can, you know, Sean, he's, he likes this idea. He loves getting an edge, but he's kind of lazy and so he doesn't want to go do all this stuff. Why doesn't somebody bring that online? Like Roddy's List, I guess, is an example of that, bringing that part online. What about after that?

• 39:39Speaker 00

  Well, I think you could, there's a couple of things that you need to do in real life. Like you have to validate that the house exists, right? And the, the couple of keys to the actual auction game are that there's some part that is just, you gotta walk the walk. So you could go and buy a house at foreclosure and look at it on Google Maps. But Google Maps is an updated same day. So that house actually might've burned down last week or a month ago. And I know somebody that that's happened to. Or the house, if you look at it on Google Maps, you may not be able to tell that the inside of the house or, you know, the back end of the house is totally blown out. So you've got to kind of go walk the properties a little bit is one part of it.

• 40:19Shaan Puri?

  Right.

• 40:20Speaker 00

  And then the other part is it's about debt and who owns the debt. And like one thing I've realized about wealth over time is debt is just about everything. You should always look for, even before you do a startup investment, is there any debt on the company? Am I in a first lien? Does that, you know, do I have first access to money if this company gets it in some way? And it's the same with the house. So a lot of these times they'll have a lien on the property that's like, this is weird. This is actually would be an interesting business for you guys to look at. Like one of the biggest predators on low income homeowners is, you know, those faucets, like the little water purification faucets that you have in like your house?

• 41:00Shaan Puri?

  Yep.

• 41:01Speaker 00

  So oftentimes those are put in houses by people that come door to door and try to sell them to people. And, and they use it by doing a lien or applying debt to that person's mortgage. And so you could literally have a lien before you for like $1,500 that hasn't been paid. So it's now worth like $25,000 because the interest is 10 or 12% and you don't even realize it. So you do have to, yeah. So you do have to go actually figure out who owns the debt on the house. And you do that again through a list like Roddy's List that will tell you who owns the title to the house. But none of these are big problems. If somebody can list houses on Zillow, like Zillow now does, Sight Unseen, you could just have APIs in from Roddy's List,

• 41:45Speaker 00

  from the local county, uh, location. You could probably have updated Google Maps locations, and all three of those things triangulate to go online, I would imagine.

• 41:54Shaan Puri?

  I like it. Um, and Roddy's List is only Texas, or that's?

• 41:58Speaker 00

  It's only Texas, but there's tons of them. So usually you have to go to the county registrar, uh, and they'll list how often they do, how often do they do auctions. So in Texas, it's every Tuesday. In California, it depends by city and county. But one of the interesting things is like, the biggest buyers of homes in California, for instance, uh, in, in this downturn, in my opinion, is going to be the government, because they've essentially made it where if this is not your primary residence, you cannot buy these foreclosed homes at auction, which is a crazy change. But in 2008, that's what happened. All the PE firms went to all of these little municipalities and scooped up all these houses and got them at pennies

• 42:41Speaker 00

  on the dollar. Um, the only thing that is true about this is you need cash. You gotta pay cash. So these are, you know, you're coming in with a hundred thousand dollars in cashier's checks to buy this house and, and auction, and buy it at auction.

• 42:53Shaan Puri?

  Right.

• 42:54Speaker 00

  Yeah.

• 42:55Shaan Puri?

  Wild.

• 42:55Speaker 00

  And no paddles.

• 42:56Shaan Puri?

  I gotta just attend one of these to, to see how it feels.

• 42:58Speaker 00

  Yeah.

• 42:59Shaan Puri?

  Right. Uh, okay. Well, we'll, we'll end on these last two. Um, you wrote, uh, how to collect cool people. I don't know what collect means in this case, but is that a typo? Or did you really mean how to collect cool people?

• 43:11Speaker 00

  I did mean that. Well, actually, I wish Sam was here, because he would laugh at this one. But, um, so one of the things that I think is important for investors, or VCs, or anybody, um, I guess really who wants to be in the startup game, is like, how do you make a connection with a human? Like you, right? So, you know, we get to know each other on Twitter. I kind of retweet you a few times. But before the social media game was there, um, how I actually met Sam originally, I liked one of his articles that he wrote in The Hustle years ago. And, um, and I just did some research on Sam and was like, you know, I just think he's gonna, he's gonna do some stuff. I don't know what. The hustle was small at the time. Uh, but I, I think I want to know him, and I want him in my Rolodex in some way, so I could bother him about things.

• 43:54Speaker 00

  And um, and so I found out what his favorite candy was, which is Butterfingers. I don't know if it still is now. And so I shipped him this ludicrous sized box of Butterfingers, right? Just like a shit ton of Butterfingers. To the point where like, he didn't have a lot of choices, except to like, call me back and say, like, you know, what, thanks? Um, and you know Sam really well, I mean, he's not always like-

• 44:16Shaan Puri?

  Thanks and what the fuck.

• 44:16Speaker 00

  Yeah, exactly, exactly. And so anyway, so, and then I did that with another good friend of both of ours, Noah Kagan, except it was something about tacos at the time, because that's his little shtick. And I sent him a shirt. And so the whole point here, I guess, was kind of like, people these days will say, I'm sure they say it to you, well, but Sean, you have this huge network, of course you could raise a fund this way. Or, you know, Sam, of course you could do this, you have this giant rolodex of emails. You know, I didn't have any of that at the time, I was in finance, we couldn't even have social media. And I think those are all excuses. And instead, you should just get kind of obsessed with the people that you think are interesting, find ways to connect with them. And you can even do it in an old school manner, which might work more today than ever, because DMs and social media are inundated.

• 45:01Shaan Puri?

  And what's your, what's your next move? So if the Butterfingers and the tacos are the pickup line, and that's great, because I, and, and this happens to me, and I, I always feel like, well, you did break through the door. Like, I, I see you, and I hear you, and I kind of check you out, and I'm like, okay, cool. Um, but honestly, like, most of the time when that happens, I don't like, become buddies with them. And I think that's what they want, is like, I sent you that shirt, like, I had sent you that thing, because you said, you said you liked this, and that, so I sent it to you. I'm like, yes, I did appreciate it, but like, I didn't necessarily go start like a bromance with you after that. So, uh, what is, what do you do, let's say, with your follow through? What do you do in those cases to like, turn that little like, you know, funny, just sort of like, hey, love what you do, I'm a fan, uh, here's a bunch Butterfingers.

• 45:46Shaan Puri?

  Uh, what'd you do to turn that into more of like a peer relationship after that? Or what, what would you do?

• 45:51Speaker 00

  Yeah, well, I think a couple of things. One, you got to be doing cool stuff to hang around cool people. Rule number one, right?

• 45:56Shaan Puri?

  Right.

• 45:57Speaker 00

  So like

• 45:57Shaan Puri?

  The prerequisite, exactly.

• 45:59Speaker 00

  Yeah, so like, you know, I don't care if I was backing up a dumpster truck. Actually, that would be cool. I would probably be doing cool things if I did that for Sean. But, um, but you know, you have to actually be out there creating thing to be around creators. So I think that's rule number one, and it's to have the lowest expectations humanly possible, right? Like, I don't want anything from Sean. I didn't want anything from Noah. I just wanted them in my circle and then to ping them sporadically with random stuff. So I think I got Noah, like one of his investments that he did, I pinged him on it. Like, he actually had a question about something else. I put it on Twitter or something and I sort of responded and said, oh, I knew that person. So it was trying to serve them a bunch of different

• 46:41Speaker 00

  times. And then after doing that continuously, which is very similar to what I do with founders, when I want to invest in them, they'll eventually be like, Cody just, she kind of solves problems for me, or she does interesting things and makes my life easier in some way. And doing it without being too, you don't want to be a creep, you know? I think, I do think when I first engaged with Noah, and I can say this now because we're buds, but I think he was like, is she hitting on me? Like, what's happening here? You know? Does she like me? And I was like, no, dude, I'm married. I'm sorry. So, you know, but also just having no shame. Like, I don't have an ego. I'm not trying to prove anything to anybody. And I think that's important. What do you think? What would work for you? Would that work for you?

• 47:19Shaan Puri?

  Uh, yeah, that, that, so, so the thing you said that, that works for me is, first and foremost, the ultimate networking hack is be interesting. Okay, that sounds easy. What, this sounds like, okay, I can't do anything with that. Well, no, you actually can, which, what is interesting to other people is somebody who either knows stuff in an area that other people want to know that, that thing. So if you're an expert of a certain area, cannabis, DeFi, just be knee deep in it. And you don't have to be like a power player, just the knowledge is actually quite useful, the knowledge network. Or be doing interesting things. So if I see you out there actually making shit happen in your field, and it doesn't have to be a big, you know, you don't have to be doing SpaceX, like, but you gotta be doing something. So what, what doesn't work is the opposite.

• 48:04Shaan Puri?

  You reach out, you ask me for something, you ask me for my most valuable thing, time, without offering me any reason why I should give you that time. And maybe I will anyways, because I'm just in the mood, but like you didn't help yourself by like said, making it easy for me. And lastly, you're basically saying, hey, I'm kind of doing nothing. And I think if you talk to me, then I'll start to like, do something or I'll know what to do.

• 48:28Speaker 00

  Yeah.

• 48:28Shaan Puri?

  And, and that's not fun. Like, you know, so what, what do I like? I like people who are doing interesting things. And then they reach out or I reach out, either way, doesn't matter. And in doing so, they are, like you said, a non needy person. So they're happy to give, they're happy to chat. And they have low expectations. One of the weirdest things is when people start with like, hey, big fan of what you do. I know you get a ton of messages, but I just wanted to put this on your radar. Cool. Great first message. Second message comes in like 19 hours later. I guess you just don't even care. You know, what was the point of this anyways? So, you know, like, I really thought you were a good guy, but now I know the truth. It's like, whoa, whoa, whoa, what's going on?

• 49:12Shaan Puri?

  Like you sort of pull a what a idiot. Now you're really needy and desperate for some kind of response. And now you expect things of me that I never ever offered to you. So, so I would say like, you know, just do the opposite of those bad things. So be interesting. Don't expect anything in return. Just give and give little bits. Don't even give too much because giving too much is actually creates an obligation also. So just keep it really simple. Share interesting things with the person. Share life updates if you're doing cool stuff. And be useful. If they're trying a project, give them some feedback, help them out, reach, share, you know, spread the word, tell a friend, whatever. And let them know that you're kind of, you know, in their corner. That's all that it takes really to like break through with most people. And then from there, you know, it's either going to work or it's not. And you know, that, that's fine.

• 49:56Shaan Puri?

  Not everybody's meant to be friends with everybody and that's okay.

• 49:59Speaker 00

  Yeah. And don't ask to be mentored by anybody. That's my biggest pet peeve. I'm like, I can barely mentor myself. You don't want me mentoring you. What are you talking about? Not to mention talking about an obligation. It's like, wait, have you looked up the definition? That means that I am supposed to lead you like on your path of purpose? We don't even know each other, man.

• 50:17Shaan Puri?

  Right.

• 50:18Speaker 00

  So, yeah, I totally agree.

• 50:21Shaan Puri?

  Yeah, and somebody said this, and I thought it was totally spot on. They said, you know, the easiest way, if you really do want a mentor, first, first things first, acknowledge that seeking a mentor is an advanced form of procrastination. You think that you need a mentor before you do the thing, and in reality, your mentor and all other people who succeed don't use mentors as a prerequisite. Yeah, they find people along the way that help, but that's because they're just in furious motion, and people turn and look, who's splashing in this pool? And sometimes they go and they lend a hand, and you know, when you need it. But they didn't sit around and say, well, if I get that mentor, then I'm going to do the things. So that's the first thing. It's a, it's an advanced form of procrastination. And secondly, the way you actually do form a mentorship bond is you ask somebody for

• 51:06Shaan Puri?

  a specific situational piece of advice. So not just, what should I do? But like, hey, I'm debating between these two options. How would you think about this? Or here's how I'm thinking about it. Would you poke holes in that? And then, then you follow up, which is where 95% of people fall off the cliff. They get advice and then they don't follow up with, hey, I listened to what you did, or I did a variation of what you did, and here's what happened. People actually love hearing that update. It's they're, they are gathering data points of like, what works, what doesn't. And it just feels good that like, you closed the loop, you get some closure on that, that conversation. And then you just say, and now here's the next thing, like, that's, that's going on. And, you know, some people will drop off because they don't want to deal with you, and some people will give again. And then you do that the third time. You say, hey, here's what happened.

• 51:50Shaan Puri?

  And now, this unexpected thing is going on. And here's how I'm dealing with that. And by the third one, you guys will know, either this works, we have a good rapport, we see the world in similar ways, that complement each other, they kind of like my spunk, and I like their experience, and like, it meshes, and we should do this. Or you'll know by then that, you know, this is not the right fit. And so how do you, that's how you organically ease into having a mentor, rather than trying to put a label with a stranger and asking them to commit to something that they, you know, don't really necessarily want to do with you.

• 52:23Speaker 00

  Yeah, you nailed it. I also think, and this is like, probably not very PC, but I think it all becomes easier once you've achieved like, a little bit of financial Financial freedom, like I think the less you're focused on making money every day and like, you know, being in that sort of employee lane and you can do interesting things with your money, that opens up a ton of opportunities. So I'm, I'm pretty big on like, it's hard to be ideologically free. It's hard to be time free. It's hard to really have any freedom if you don't have financial freedom. And like, that all means something different to us. Like you and I might think that that means X big dollar amount, whereas some people might be like, no, it's just enough to cover, you know, the money that I need to pay today. But that's like, one thing I wish more

• 53:06Speaker 00

  people could think about is like, how do you, how do you really get financial freedom so that you can do all the stuff you want to do? And then, you know, how do you get critical thinking freedom, where you can actually learn to ask the right questions?

• 53:18Shaan Puri?

  Here's the bit of insight I've had, the realization I've had recently, because I worked for like a decade being like, financial freedom is what I want. And even more so, I was like, okay, I want to buy a house so that, you know, I want to, I want to have enough where I can get my mom a place because she'll have a better life that, you know, if we could do that and blah, blah, blah. And so I thought financial freedom, that's the best kind of like, that's my goal right now. I think a lot of people are like that. And, and now that I kind of achieved a lot of those goals, I was like, okay, definitely my goals just got big, kind of bigger. And, you know, it's not like I, and it's true, I definitely do like carry myself a little bit differently and choose projects and people differently because I'm not like, I'm not in, I don't need you for

• 54:03Shaan Puri?

  the money, but, you know, so I don't need to do this for the money. I could do many things. And money should probably come along with all of them. And I don't, I don't need near term money necessarily. So there definitely has been some benefits, but here's the realization. I used to think about financial freedom, like, if I get X dollars, then for me and my lifestyle, that's, I'm financially free. And then for another person, they might have a different dollar amount, which I think is kind of what you're saying. And I thought that, you know, as recently as like a month ago. And then I met a bunch of people who have a way smaller dollar amount, but what they have actually also is way fewer demands and desires about what they want out of their life. You know, in a good way, like they're happy as is, so they don't feel like, well, I need X,

• 54:47Shaan Puri?

  then I'm gonna be like happier. Like, wow, I'm super happy right now. And like, great, if I have more money, like, I'll have other things, but I'm not gonna have more happiness. And so, and so what I realized was that financial freedom is actually just, it's an internal question. It is not about a dollar amount. Financial freedom is when you stop deciding what to do based on money. That's when you have achieved financial freedom. And for some people, it takes getting a large amount of money so that they can do that stop. For other people, it's wanting less shit, and then they can stop because they have less demands for money, their, their total number's lower. And for other people, it's more like, you know, sort of Buddhist or monk-like, where they just sort of realize that it's actually an internal attachment that they have to

• 55:31Shaan Puri?

  let go of, and then they are now free. The freedom is, is freedom from your own desire to have more money, and therefore you choose things based on money, rather than the kind of mathematical definition, which is, well, you, like, there is also like a sort of technical definition, which is, you have enough money where even if you earn zero income, your investments will pay your lifestyle, and you won't be sort of dip, you know, you're not dipping into savings. Your savings are, are increasing at a rate faster than your life burn. There is that technical definition, but I realize, I know many people who pass that technical definition and still aren't financially free, and it's because internally, they have not actually freed themselves from what they need, from this idea of like, well, I gotta

• 56:15Shaan Puri?

  do, like, putting money first as the choice, as the choice of what to do, whether it's people who penny pinch, or it's people who choose projects based on a financial return as the, like, kind of core criteria. Anyways, that's the sort of-

• 56:28Speaker 00

  I like that framework. No, I think it makes a lot of sense. I think, you know, above a certain level. Like, I get a little obsessed just with everything that's going on economically in the world with people who- Again, like aren't maybe where you and I are like, I almost think financial freedom might have something to do with your skill stack. Like even if you lost all of your money today, or if I lost all of my money today, as long as I have put as much mid-relationship deposit as I think I have of other humans that are doing interesting things in the world, you and I are never going to be homeless. Like pending catastrophic issue, right? Because you can go to some of your friends and be like, hey, I'm actually pretty good at copywriting. Don't you see? Look at my Twitter account. Hey, I'm actually pretty good at building these businesses. I've sold a couple of them. So, once you like get that skill stack, you're like, I'm fairly confident.

• 57:13Speaker 00

  Worst-case scenario, I can go call up somebody and work for them. So, I think there's some mixture of the dollar amount in your bank, what you need to pay, not having a ton of debt, and then are you competent enough as a human where somebody will always need your services? And, you know, and I think that paired with like, can you reason and think for yourself is a pretty powerful combo.

• 57:34Shaan Puri?

  Yeah, totally agree. I think that's great. So, give us, we should wrap up. Give us where, where can people subscribe to the newsletter? Because it's actually really damn good. And I don't say that like, actually, I'll say it. I would probably say that anyways, if somebody came on as a guest, I'm like, oh, you have a great newsletter. But I'll just kind of shout out that I actually believe it here. I'm not just being polite, but you actually do a really great job. And you're like us, you don't shy away from the topic of money. You actually lean into it. You say, hey, you know, like, a lot of people are interested in making money, and a lot of people don't know what's under the hood of these different business models or businesses. And so, like, let's lift the hood together and let's look at this, how this engine works and how it, what's good about it, what's bad about it, and how you might make it work.

• 58:19Shaan Puri?

  We do that as a podcast, you do that on your newsletter, and we're very like simpatico as far as that goes. And so, where can people find you and where can people find the newsletter so they go subscribe?

• 58:28Speaker 00

  Thanks for the shout. Yeah, ContrarianThinking.co is the newsletter. And then it's Codie Sanchez, Cody underscore Sanchez on Twitter. I think those are probably the two places I'm most rocking and rolling. And Twitter, man, I've really found that fascinating in the last six months. I think we've finally figured out how it works. So, apparently, I'm a little bit more a boomer than a millennial in some ways.

• 58:51Shaan Puri?

  Yeah, there you go. Cool. And we'll link it in the description. So if you didn't remember those, just scroll down and click the links in the description to to find that of the podcast. Okay, Cody, this has been amazing. Thank you so much. I would like to have you back on at some point. Maybe we'll break down a couple of the businesses that you've either acquired or been looking at recently. And I think that'll be a lot of fun. But thank you for coming.

• 59:10Speaker 00

  I'm in. Thanks for all the questions. It's always fun brainstorming with you.

• 59:19Speaker 03

  I feel like I can rule the world. I know I could be what I want to. I put my all in it like my days off. On the road, let's travel, never looking back. Oh, yeah. Feeling like gold. I don't wanna hide it. Ain't nobody telling me no more. Get your feels wherever I go. Yeah, yeah, yeah. Like I can rule the world.