Kevin Ryan: How This Billionaire Founder Finds +$20B Business Ideas

Episode 495: Shaan Puri (https://twitter.com/ShaanVP) and Sam Parr (https://twitter.com/theSamParr) talk with Kevin Ryan, Founder and CEO of AlleyCorp, an incubator and venture capital fund behind Business Insider, MongoDB, GILT and Zola among others. Kevin shares how he runs his +$20B venture studio AlleyCorp, why Buzzfeed ultimately failed, how he launches 8 companies a year and much more. Want to see more MFM? Subscribe to the MFM YouTube channel here. — Check Out Sam's Stuff: • Hampton - https://www.joinhampton.com/ • Ideation Bootcamp - https://www.ideationbootcamp.co/ • Copy That - https://copythat.com/ Check Out Shaan's Stuff: • Try Shepherd Out - https://www.supportshepherd.com/ • Shaan's Personal Assistant System - http://shaanpuri.com/remoteassistant • Power Writing Course - https://maven.com/generalist/writing • Small Boy Newsletter - https://smallboy.co/ • Daily Newsletter - https://www.shaanpuri.com/ — Show Notes: (0:00) Intro (3:15) Selling DoubleClick to Google for ~$3B (5:20) Starting Business Insider, MongoDB and Gilt (11:00) What led Kevin to start Business Insider (15:00) Why Kevin hired Henry Blodget to run Business Insider (16:45) What did Buzzfeed get wrong? (18:45) Why has AlleyCorp been such a success compared to other venture studios? (29:20) What businesses Kevin’s excited about right now (39:00) Thoughts on buy vs. build vs. bootstrap (41:00) What business has been the easiest and most profitable? (42:50) Thoughts on AI (44:50) Launching 8 companies a year (47:40) Why Kevin isn’t on social media (50:20) Starting companies in the recruiting space (54:20) The benefit of being emotionally stable (56:20) Kevin’s investment portfolio — Links: • Kevin’s Linkedin - https://www.linkedin.com/in/kevinryan3/ • AlleyCorp - https://alleycorp.com/ • Business Insider - https://www.businessinsider.com/ • Henry Blodget - https://twitter.com/hblodget • MongoDB - https://www.mongodb.com/ • Gilt - https://www.gilt.com/ • The Ladders - https://www.theladders.com/ • RippleMatch - https://ripplematch.com/ • Do you love MFM and want to see Sam and Shaan's smiling faces? Subscribe to our Youtube channel. — 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. — Other 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.

• 0:00Sam Parr?

  You like violate this rule that I have for myself and you do it so wonderfully, which is focus, or at least it appears as you do. You like launch like, I don't know, how many companies a year do you launch?

• 0:11Shaan Puri?

  Eight.

• 0:12Sam Parr?

  Eight? God damn.

• 0:23Sam Parr?

  All right, we're live. Kevin, do you, this is Kevin Ryan. Do you remember me?

• 0:29Shaan Puri?

  I don't remember where we met. I know we've met, but I don't remember where.

• 0:32Sam Parr?

  That's good. Okay. You don't have to remember. So basically, I'm going to tell you why this is funny. So basically, I've studied you for maybe 10 years. So you started, you were the president of, and CEO of DoubleClick, which had like a billion dollar plus exit. And then you have started like four or five companies that are, one's worth, I think 28 billion today, one's worth, you have a couple billion dollar exits, but you started Business Insider and I cold emailed you maybe 50 times. And one of those times, because I admired you so much, and we'll talk about your career, but I wanted to be like you. And one of those emails, you finally replied and you just said, like, thanks for the updates, whatever. And then I lied and I said, I'm going to be in New York

• 1:15Sam Parr?

  tomorrow. Can I get 20 minutes of your time? And you let me do that. And I came to your office for literally 20 or 30 minutes. We had such an impactful conversation. And then you did another follow-up call with me and I have the notes from those calls. And this was in 2017. And you made a bunch of predictions about my life, as well as the media business and a few other things that were 100% true. And I refer back to that note sheet on a consistent basis to help make some decisions.

• 1:42Shaan Puri?

  Oh, interesting. I'm glad, sometimes I get lucky and I get it right.

• 1:46Sam Parr?

  And you want to know what? Your, your PR people cold emailed us to get you on the pod. So the tables have turned, my friend. Welcome to my world.

• 1:56Sam Parr?

  But I just want to say, like, I've admired you for a long time. You're, you're a really big deal to me. And so I'm so happy that we're able to like finally do this. This is awesome.

• 2:05Shaan Puri?

  And Kevin, you don't know me, but I did not stalk you. I did not cold email you. In fact, I was a little bit just jealous of you because I was at the time working in a, when Sam was telling me about you, I was working at a startup incubator studio. And so we were launching four or five companies a year and After three, four years, I was like, I don't know if this model even works. I just feel like it's like this. Cause there's something inorganic about the studio model versus like just a normal startup that that comes from an entrepreneur solving their own itch. And he's like, well, I don't know. This guy Kevin Ryan seems to do it. He's cranked out four or five billion dollar companies out of this. And I was like, huh, I guess I should shut up and uh,

• 2:44Shaan Puri?

  just, you know, I guess not the model. That's the problem. It's me. Uh, so you know, I, I, I think not only is it cool that you built big media companies. It's cool that you made the stuff, the studio model work when very few people have been able to do that.

• 2:57Speaker 02

  Yeah. No, no, I still enjoy it. Uh, by and large, it's still working. You know, things go wrong. It's not, I wouldn't say it's easy. Uh, we have a lot of companies that are doing really well in, in different sectors. And so that's what's so fun. And look, there, there are more things to be done. There are many problems in society that have not been solved.

• 3:15Sam Parr?

  And basically the high level story of you is you, uh, you have like a normal corporate career, but then you kind of like worked your way into, uh, DoubleClick.

• 3:23Speaker 02

  Yeah.

• 3:23Sam Parr?

  Which eventually I think became Ad- AdWords at Google.

• 3:26Speaker 02

  Exactly. Yeah. So Google bought it for about $3 billion in 2007. Uh, the company started in 1996. I was there for nine years. It was public for seven years. First four years went from 10 people when I joined to 2,000, which was so crazy and 25 countries. So that's what I spent my early thirties doing. Um, then we spent three years bringing it back to a thousand people as the internet collapsed. And 70% of our clients went bankrupt. So don't do that. Uh, then we, we had huge market share, controlled basically ad technology. And so then, uh, Google bought it. And then I started, uh, Business Insider, you know, Mongo and Gilt.

• 4:04Shaan Puri?

  I want to point one thing out in this journey, by the way. Your career starts at Prudential. Uh, so shout out to all the listeners out there who are in boring companies right now, boring, huge companies, consultants and bankers out there. There is hope for you yet. So you did like Prudential, Euro Disney, blah, blah, blah. And then you joined DoubleClick as employee 20, but you, you, they brought you in, I guess, as like a senior person at the time.

• 4:26Speaker 02

  Yeah. Yeah. Uh, what happened is I had launched an internet website for EW Scripts, which is a media company. And I was the COO and CFO of a division of that company.

• 4:35Sam Parr?

  Wasn't it basically just like Gilbert Comics or was it?

• 4:38Speaker 02

  Exactly. Yeah. Gilbert Comics and, and we had other comics. We owned Peanuts and a lot of other ones, but on a relative basis, it became very successful as a website. We sold, uh, advertising, uh, e-commerce, uh, so things that were not that easy to do because we didn't have the vendors at the time. So I went to the parent company and said, look, we should build up an internet division. And they said, no. And I thought, you know, I actually believe that the internet's going to be a huge, which is obvious now, but you know, a huge part of the next 25 years. I want to go do this whole time. So I was going to go start a company. I ran across DoubleClick that was already in the ad tech space. They convinced me to join them instead of starting my own company. I became the CFO, the president, and then the CEO.

• 5:19Sam Parr?

  And then when we met, you basically, you kind of outlined after selling DoubleClick, you said, basically, my partner Dwight and I, we came up with this thing where we call it Ally Corp. And we're like, we get like two or three, maybe even one good idea a year. And then we find good people and we give them $300,000. And we say, you have six months, let's see if we can make this work together. And you did that with Insider, Business Insider, which I think had a $500 million exit. You did it with Zola, which is still running and it's kicking ass, I believe. You did it with Gilt, which I think got to like 500 million in sales, but it didn't end up working out wonderfully. I think you said.

• 5:59Speaker 02

  Yeah, we sold for 250 million, which was less than we thought, but it's still obviously a real number.

• 6:04Sam Parr?

  Good, yeah, great. And then you can go ahead and correct me, but you've done this with like four or five companies. I remember this meeting from 2018, I said 300,000, that was wrong, right?

• 6:14Speaker 02

  Yeah, so we started each company with a million dollars. So 500,000 from each one of us. And that was for Gilt, Business Insider, and Mongo. And then I did, after that Dwight semi-retired. And so I did that with Nomad, I did that with Zola. And now, by now, I put about a million and a half dollars in each company when we start them.

• 6:36Sam Parr?

  Which isn't a significant amount of money for how big. I mean, MongoDB right now is trading, I think it's market cap is $26 billion today. I'm sure at COVID peak, it was like 40 or 50. That's not a lot of money for the outcomes.

• 6:49Speaker 02

  No, no, and look, we had to raise a lot of money. I mean, Mongo, between being a private and public company, raised and lost a billion dollars before they had a profitable quarter. And now already make $300 million a year in profits. So that's why it's so valuable is because it's just an incredible company, growing quickly, enormous market share, and is going to grow for the next 10 years. It'll be a $50 billion company.

• 7:14Sam Parr?

  Well, you told me in our call, you said. One of my notes is basically if you're not hiring fast enough and by the way, this is like this is the VC route, but you said if you're not if you're not hiring fast enough and losing money aka investing, you either haven't figured it out or you don't believe that your idea is good enough. And so you need to grow faster.

• 7:38Speaker 02

  Well, and but you don't want to grow fast just to grow fast. If you have a good idea and if you're hiring a salesperson who costs 150,000 and they're selling $500,000 worth, you need to hire those people all day long because you have an opportunity. And if you have other products to create, you should hire these engineers to to build it. So again, it's not spending money to spend money. But if you're building a big company, it's going to take eventually 1,000 people or a few thousand people to do a billion dollars in revenue.

• 8:05Sam Parr?

  Well, and your analogy was you go, look, if I if my idea is good enough, I'm going to build a machine that turns $1 into $2. And if I have that machine, what are you going to do? You're going to go get as much money as you can and back that truck up into that machine and dump it in there.

• 8:21Speaker 02

  Exactly. Now, there are times in various companies where it doesn't make sense to invest a lot more money because we're not getting the return. You run out of market share. It's not as big a market as you think. Something's not working as well. And so then the right thing to do is to not invest. And I have companies right now that we've cut 30% of the people in the last year because given this market and what they were doing, we had too many people.

• 8:43Shaan Puri?

  So there's also a note in that call that I thought was really useful. So I'm looking at Sam's notes from your call like back in 2016. Sam's building the hustle, trying to figure out what to do next. I assume you were considering raising money because you wrote this down and I thought it was it's obvious when you hear it, but I most entrepreneurs, I don't think, think this way, which is you said, let's say you're going to raise $2 million at a $20 million valuation. So you're going to dilute 10%. And you're saying, you just have to ask yourself, if I took that $2 million and I invested it into growth, people, whatever, over the next 18 months, is our company going to be worth more than 10% versus if we do not? And if it is, then I need to do that. I should do that trade. And if it's not, I should not. And did I capture the the logic properly there?

• 9:27Speaker 02

  Yeah, no, exactly. That's what you have to look at. And, you know, you don't, you don't want to raise too much in that round. Because if you sold 10 million, then that's very expensive capital. If you think it's going to be worth $100 million someday or $200 million, you should raise that money later. But you do need to get moving and time is never on your side. You know, any good idea I've come up with, eventually, even if six months later, three other people are going to come up with the same idea. So you need to move quickly. People tend to, they, most people understand the, the risk of doing something. They understate the risk of not doing something.

• 10:04Shaan Puri?

  Can you tell us a story where moving fast either benefited you or cost you big in one of these races that you ran?

• 10:11Speaker 02

  Absolutely. So DoubleClick is the perfect example. We expanded to 25 countries before our first country was profitable. So if we were a big company, everyone would have said, look, let's wait and see and make sure our model works. But the result was if you were Procter and Gamble or Caterpillar or IBM, who did you work with? You worked with us because we had operations in 25 countries and you have offices in those countries. You didn't work with our competitor who had offices in six countries. As a result, we swept the market. We lost a bunch of money, but we were able to fund it. And that is the reason today, 25 years later, that, you know, uh, Google still has a commanding share. It's because we got it early on and it's never been given up. But you're taking a chance.

• 10:54Speaker 02

  I mean, there, there are times when you invest in something and it doesn't work that well. And you're like, wow, we should have waited. You don't have time to wait.

• 11:02Sam Parr?

  What insight, was Insider, Business Insider, was that? So you sold DoubleClick. You, back then, when you and I met, you actually told me how much money you made off the DoubleClick sale. I, I won't say it unless you want to say it. But did you, um, which I thought it was amazing that you told me this. I was like, damn, this guy is helping me out so much by telling me all this information. Did you, you and Dwight got together to start, I don't know if you call it an incubator or whatever you call Ally Corp. But did you, was Insider the first idea that you had? And what led to that, what led to the insight to start that?

• 11:35Speaker 02

  Yeah. So the Insider idea was so simple that you can't even give us credit for it. So this is 2007. I love business publications and media publications. So I'm a sort of a compulsive reader of that. And I didn't have the publication I wanted. And it's so hard to, to remember for people today that the Wall Street Journal and Business Week at the time did not, basically did not update their websites during the day.

• 11:58Sam Parr?

  That's crazy.

• 11:59Speaker 02

  They're thinking that's impossible. And the reason is that they were still on that schedule of the paper comes out the night, you know, the, the morning. Articles have to be done late at night. And so at 10:00 AM, 10:00 AM, no one's updating anything. And so they just had not adapted and don't forget, we only got mobile phones in 2008. And so then all of a sudden, all day long, you're in the taxi. Of course, you want to get an update on what's happening. So the things we did are so obvious and done today, but we were early, which is updating things continually. Writing stories that were not complete in a way. We'd hear a rumor that X company was buying Y company. We'd say, that's what we're hearing. And you know what happens when you write that? Someone from that company calls this, yeah, actually it's true.

• 12:45Speaker 02

  And so then you get more information. And so you maybe write four or five stories during the day as you get more and more information. And we also had a point of view. So we'd write so and so just overpaid for a company. It's more important that we have a smart point of view than that we're right in the long term. And so, and we did a great job of making sure we showed up in search results. So again, everyone does that today. At the time, no one cared about headlines because if you had Businessweek magazine, does the headline result in more revenue for you? No. But we would A B test three headlines very quickly on a story and realize what was working.

• 13:25Speaker 02

  And so what I'm proudest of is that Business Insider is at 300 million uniques today and never spent $1 in advertising.

• 13:34Sam Parr?

  Yeah, you told me, well, you said, we were gonna just churn out these articles, which is common now. But you had this really cool insight. You go, it's kind of like Honda in 1985 versus General Motors. Americans laughed at the Honda car. They said, this is just too flimsy. This isn't good. But they're gonna like capture some market share and they're going to improve. And you said, it's kind of like that with Business Insider. The quote, the critics or the real people in the industry, whatever you want to call them, they laughed at you. And they said, this is just low quality. This is junk. And you're like, but we're gonna get more traffic than you. And I think it took like five years or something, but we got more traffic than Wall Street Journal.

• 14:18Sam Parr?

  And now they're looking at us like, holy crap, you surpassed us. And we could afford to have more substantial journalism that maybe is taken more seriously if that's even something cared about.

• 14:28Speaker 02

  I would guess by 2015, we had seven people covering military and defense.

• 14:35Speaker 02

  That's deep coverage. I mean, you, you, you have a lot. You're writing great stuff. In the beginning, obviously, we had, you know, five journalists covering the whole world. It's not going to be amazing, but that, that is a good parallel and we, the product did get better over time. We started winning awards, uh, but it always was intended to be a different positioning. It was punchier. It appealed to younger people. Uh, it was opinionated. You know, it's just a different product. Uh, but I think, I think that company, you know, we, Henry Blodget, who's still the CEO, has done an extraordinary job over 15 years. And a lot of these insights came from him and he was one of seven people I interviewed for that job and he killed it. Uh, what'd you see in him that, uh, made you pick him?

• 15:16Speaker 02

  Yeah, I know. If you remember, it was a bold choice because Henry had, had some issues on Wall Street. So you, some people felt like he was tainted. I knew that he-

• 15:25Sam Parr?

  And the, the issues, by the way, were, I think he got accused of, was it insider trading or he got banned?

• 15:30Speaker 02

  Not insider trading at all. What happened was at the time, what was standard there was that, uh, the Wall Street analyst would come, pitch the company that was going to go public and they would say, look, we're going to great, write great things about you, which is potentially a conflict with their recommendations to their, uh, their, the companies, their investors. So, um, everyone did that. Henry actually wrote internal emails saying, I feel really uncomfortable with this, which then was used against him. You know, no one else did that. And so legally, I don't think he did anything wrong. Uh, everything he wrote was approved by his superiors and, and order. But anyway, uh, you know, some people felt like he was tainted. I didn't at all.

• 16:12Speaker 02

  What I did know is he was an incredible writer and he was a perceptive journalist. He was writing pieces for The Atlantic. I mean, he's just so good. I mean, he's so talented. And he also, he truly understood internet journalism. So the people I interviewed for the Wall Street Journal basically just wanted to redo the Wall Street Journal and which we don't need. Henry was fresh. He had never really worked in a newsroom, which can be viewed as a weakness. I viewed it as a strength. And so he changed the rules and we were willing to do that. And he did an incredible job.

• 16:45Shaan Puri?

  You know, that same strategy of kind of like, start with the content quickly that gets traffic. Don't try to be, don't look for kind of like the peer acclaim in the industry. Look for what the market wants and then over time improve the quality. That was also BuzzFeed's strategy. But today I'm looking at the BuzzFeed stock. It's 36 cents. It's a $50 million market cap. What do you think they got wrong? Or what happened to BuzzFeed? Because it seemed like they were, they had that whole, that same playbook. And Jonah Peretti, if you ever hear him talk, he seems like, you know, whip smart in the same way.

• 17:17Speaker 02

  For me, it's very clear, and I felt this from day one, even when they were theoretically worth $2 billion. I rarely ran into someone who said, I love reading BuzzFeed every day. I don't believe they built up a true brand. They showed up in search results, they got traffic. But there were many, many people that religiously read Business Insider every single day. So it just had a brand that I think was much stronger and more defined.

• 17:46Sam Parr?

  And you guys have another funny part about you, which is, I was telling my wife this because we were talking. I was telling her, I was going to talk to you and I followed Dave Portnoy on Twitter from Barstool. Business Insider is the only one to get one up on him. So you guys had this, you guys had this article about some, some stuff that he had done. And he went ape shit. He went crazy.

• 18:10Speaker 02

  Yep.

• 18:11Sam Parr?

  And Business Insider had the best response, which was no response. You guys didn't reply to anything. And it's the only time I've ever seen Dave Portnoy get one up.

• 18:21Speaker 02

  I wasn't really involved with that whole exchange that happened after I, we sold the company. So.

• 18:27Sam Parr?

  Well, I thought it was pretty funny and I, I thought it was, I thought Business Insider actually handled it wonderfully. And they were the first people that I've saw that got one over on him.

• 18:38Shaan Puri?

  You know, Kevin, you guys have had so many hits come out of the studio and. As somebody who ran a studio for six years and did not have billion dollar hits come out of it, I gotta know, what's the, what's the secret? What, you know, what was it that you guys were doing differently? And I'm sure you've talked to many other people. You've seen many entrepreneurs start these labs and you've probably seen the same results that I have, which is that very, very few come up with anything that works. What do you think you guys did differently than others?

• 19:07Speaker 02

  So it's not that, you know, detail wise, we did anything differently. At the end of the day, this is a simple business, but hard to do. In other words, you need a good idea and you need a good team.

• 19:19Speaker 02

  So that's just, there's nothing else. So, you know, we've had some good ideas. We do a lot of research, you know, at any one time, we're doing deep dive. So someone will spend two and a half months interviewing 50 people, doing the same thing that I would do if I were an entrepreneur about to start a company. So we have a lot of knowledge. There's a 50 page deck. We've really gone into it and then we're committed and then we go hire a great team and we help that team. But again, it's a little bit like watching, you know, I don't know, a good basketball player, a good soccer player. We know what they do. We can see what they do. Can I do what they're doing? Not very easily. So I think we've executed well there and, you know, we have a bunch of people, including myself, have a lot of experience doing this. It's just a series of judgment calls.

• 20:00Speaker 02

  You know, I think I'm able, because of the track record, able to convince some good people to be CEOs. That's important too. And we, you know, we spend a lot of time helping them. So I chaired 12 companies. So about half my time is spent focusing on those 12, which are 12 of our most valuable companies, to really guide them and make sure that they do as well as possible.

• 20:20Shaan Puri?

  Walk us through like one of those ideas.

• 20:23Speaker 02

  So, okay. So here, for example, two and a half years ago, so I'm, I'm very interested in psychedelics for mental health. I'm the leading funder of the Yale Center for Psychedelic Research. You know, I'm involved with a bunch of things, non-profit research for, you know, pushing psychedelics forward so they can be legalized either by, by the FDA or by state. So with that context, two and a half years ago, I said, let's do a deep dive and see if we come up with a for-profit idea. The person on my team works with me, interviews 50 people. Yeah, we're talking to everyone and we come up with a solution that was partly influenced by some of the work that's been done at Yale. And we started a company called Transcend.

• 21:04Speaker 02

  The person on my team, actually, which is unusual, spins out to become the CEO, Blake Mandel. Big article in the Wall Street Journal about five months ago about Transcend because we started off with a million and a half dollars, but we raised $40 million about a year to a year and a half later in two tranches at 80 million pre. So, big, big, big, big step up, big valuation. And we have a compound that you haven't heard of going through the FDA process. It's in phase two trials right now. And so people are obviously optimistic about the future, like the team, like the execution. We did some things very well there. We have been awarded patents. For example, if you follow this industry,

• 21:46Speaker 02

  you know that you can't patent MDMA or mushrooms because those have been around for a long time. But we actually did get a patent for methalone, which is the compound that we're working on. So, so far, so good. Now, there's still risk, but that company is, you know, we currently have a $50 million position based on our $5 million that we've invested so far. And we think it has a lot of potential.

• 22:08Sam Parr?

  What about like with MongoDB? So that was started, I think, in 2007. So Ali Corp was like a little bit early. Did you have a team helping you research ideas back then?

• 22:20Speaker 02

  No, I didn't. That was purely Dwight, myself, and Elliot Horowitz, who was the most brilliant young engineer at DoubleClick. Now, out of 700 engineers, if you could pick out one person other than Dwight, you would have picked him. And so we started a company together in 2005 called ShopWiki, which is a search engine for shopping. Did okay, not great. We sold it in 2007, made a little bit of money, and then said, what are we going to do next? And so came up with this idea, started working on it. It was a very hard slog. It's very easy to feel good about it right now. For three years, we had zero revenue. So not easy to keep funding going back to VCs with zero revenue.

• 23:01Speaker 02

  But we had a lot of people using it. So, you know, we broke through that, but we had some ugly financing rounds. You know, especially back in 2009, 2010, it was not a good time to be raising with no revenues. Then finally, Sequoia came in and then we raised a lot of money and now it does getting close to a $2 billion run rate.

• 23:22Sam Parr?

  Did that company make you a billionaire?

• 23:24Speaker 02

  So, yeah, I mean, look, for all of us, it definitely, uh, yeah, we all made lots of money on that, on that company. Definitely.

• 23:31Shaan Puri?

  Those three years with no revenue, uh, at the time, were you like, people just don't understand that this thing is, uh, like, others don't see it, but I see it. Or were you like in the fog of war? You're like, I don't know if this is a thing, if this is gonna make it, but, um, you know, let's keep going.

• 23:45Speaker 02

  No, no, I would say that all of us were nervous. Yes. Uh, you know, you like to have revenue when you're gonna run out of money at some point. What helped us on the inside was that, uh, the utilization, the number of people using the product, it was free, was growing every single month, all over the world. So there's, you know, probably 50,000 small companies using the product. And so, you know, there were hundreds of meetups about Mongo and people were showing up. And we can see in a way that the dogs like the dog food. Uh, we just needed to then make it good enough that larger companies would pay money for it. And then we got there and, and the rest is history.

• 24:23Sam Parr?

  But what's crazy is like, all right, Business Insider, I understand that well. That's media. I get it perfectly. Gil, that's commerce. That's fairly easy to understand. Zola, the kind of media-ish related, but like a feel, like I understand that business. And then you have like psychedelics, which I don't have anything about, but then Mongo is like highly technical. I, I, I barely, I don't, I don't even know the use case, to be honest. It's a database company, involves SQL. Like, I don't even, I'm so not technical. It's pretty amazing that, like, are you, are you pretty, I mean, you are now, but were you well versed on what this idea was? Or did you just trust Elliot?

• 25:00Speaker 02

  So Elliot and Dwight, you know, were the brains and the technical chops. Like, the product could not have been built without them. I understood the high level problem, which I saw, which is that Oracle was not the right database for the future because we were going from structured data to unstructured data. The way to think of that is that if I, you know, you think of a spreadsheet, which is how we all thought about data. But if I told you I have 10,000 videos, can you put that into your spreadsheet? And you're like, well, no, actually, it's not built for that. But of course, data was moving that way. YouTube came out in 2005. Video is going to be enormous. So I knew that trend was happening. I knew that the Oracle product was extraordinarily

• 25:41Speaker 02

  expensive for us. And so there had to be a cheaper way. We had seen Linux come out. So that was an open source, you know, operating system that was enormously successful. And so we thought collectively that we needed an open source database that was structured for the future. And so that was the bet. So that I understood. If you said five levels down, do I understand the code? No. But, you know, I was working with, anytime you start a company, you know, like, I'm not a particularly good writer. Henry is. And he was in charge of that product. I knew the market well enough in both cases, high level. And then it's about assembling the team. You got to think of yourself as you're the coach. You are

• 26:23Speaker 02

  not the player. And if you're a coach, and if you manage to persuade, you know, LeBron James and Kevin Garnett and a bunch of people on your team, your team's going to do well. That's actually the job.

• 26:34Shaan Puri?

  You, you like with the, when you're talking about transcend, and you're like, we've got a drug going through FDA trials. I had the same reaction that I think Sam's having, which is like, man, this guy's pretty fearless, like goes into totally different spaces with totally different business models. And with probably a whole bunch of like new things you got to learn. And even if you're the coach, you're betting money and you need to be able to recruit the right players and you need to steer the ship. Do you feel like fearlessness is something you have? And do you do you notice that like? Do you feel like sometimes I look at other entrepreneurs and I think, man, I can't believe that more of them are not doing X. Do you feel like that about the way you approach entrepreneurship? Like, I don't know, I feel like more people should be trying, they're thinking this way, but they don't seem to.

• 27:16Speaker 02

  I mean, look, what we do is just a slight variation of an entrepreneur. They just happen to have entrepreneurs working for me and we have a structure. And don't forget, we also have, you know, I have 70 engineers who work for me. I have my own in-house outsourced engineering company, which helps us build product now very quickly, which we've had the last three years. I own a big chunk of a search firm, 10-person executive search firm that we set up so that we can get some of the best talent working for us, finding CEOs. So we build the infrastructure around it, but still, most of it goes back to a good idea and a good team. And when we get that right, yes. And by the way, last one on psychedelics, I had done plenty of work. I mean, I'm not a scientist, but I've gone

• 28:00Speaker 02

  through the academic papers. I know the state of research in psychedelics. I know it's working. And then, look, what I am thinking about all the time and everyone here does is where is the world going to be in 10 years? That's the North Star for what we're doing. If something's going to happen next year, it's too late. I need to bet on a 10-year trend. So, you know, we do a bunch of things in robotics and automation because I feel good about that trend. Psychedelics is a 10-year trend. MongoDB was a 10-year trend. These are the things we're betting on.

• 28:29Sam Parr?

  What are you consuming on a daily basis to spot these trends?

• 28:32Speaker 02

  Yeah, so tons of things, no one thing. I'm on, you know, many, many newsletters that are industry-focused or general-focused or science-oriented. I read 40 books a year. I'm in conversations with people all the time where you're, you know, there's a lot of learning. And then people on my team are more specialized than I am. So, you know, I have two MD MBAs who are head up our healthcare practice, and then people below them that have worked in healthcare. So they're thinking of very specific issues that I probably wouldn't wouldn't think of. And the same is true of a person on marketplaces, a person on semiconductors and materials science, and a person on developer tools and enterprise software, and two people

• 29:13Speaker 02

  on social impact. So a lot of what we do is in those areas. And I'm a bigger and bigger believer now of industry focus.

• 29:21Speaker 02

  You and I are not going to think of something that applies to the chemical industry right now. But if that's all you did for six months and interviewed 100 people, you'd probably come up with some ideas that make sense.

• 29:33Sam Parr?

  And the industries that you care about right now are health?

• 29:36Speaker 02

  Healthcare, definitely. Then the ones I mentioned, so semiconductors and material science, developer tools with some security, marketplaces, B2B marketplaces, social impact and robotics and automation.

• 29:52Sam Parr?

  What's an example of a B2B marketplace that you're interested in?

• 29:56Speaker 02

  Yeah, so we have done a deep dive into the maritime industry. So shipping, no one thinks about it, multi-hundred billion dollars, very behind in technology. We invested in a company called Box Hub. It's a marketplace for those containers that are on container ships. Based in Toronto, most people wouldn't have known about it. We led that round. We also have just started a company in maritime. That's going to be a procurement marketplace. So your ship, let's say you're arriving in Cartagena, your boiler breaks. What are you going to do? You weren't planning on that. And so having a site you can go to that becomes sort of the Amazon of that and has delivery and can get you those parts.

• 30:42Speaker 02

  Everyone in the industry told us that that's needed. So we're literally just built a team two months ago. There are probably four people right now, and so we're off and running.

• 30:50Sam Parr?

  What's that company called?

• 30:51Speaker 02

  It doesn't have its official name yet.

• 30:54Sam Parr?

  So, all right, let's use that as an example. So you basically did, did you just go and somehow network your way into talking to 50?

• 31:03Speaker 02

  Oh, yeah. So a woman on my team absolutely did that and went to two maritime conferences. So, which she said were fascinating. It's basically people from Venezuela, you know, the Middle East, Russia, you know, from all over the world, Greek. And so trying to understand the industry.

• 31:21Sam Parr?

  Just a bunch of pirates hobbling around and a bunch of parrots and bird shit all over the place?

• 31:27Speaker 02

  She said it did not look like her Princeton reunion at all.

• 31:33Speaker 02

  So, yeah, and so, and she met with a couple of investors who invest in this space, you know, ship owners, data providers, everyone. You're just trying to understand how does the industry work? And I think there's an advantage sometimes coming from outside. Some people just say, oh, that's just how it works here. And the person on the outside will be like, wait a second. It doesn't have to work that way. You know, we can do better.

• 31:55Sam Parr?

  Right.

• 31:55Speaker 02

  And that's why, like, you know, Henry was the perfect person coming from outside. You know, when I started Gilt, none of my initial five people had worked in the fashion industry. But we understood the problem. It wasn't that complicated. So we could create something that was, that was interesting and unusual. Uh, so that's the right approach. We just started a company in assisted fertility. I'm sure you guys know, you have friends, you know, who are getting IVF.

• 32:22Sam Parr?

  I did it.

• 32:22Speaker 02

  Yeah, my, my brother and his husband, you know, uh, had a child through surrogacy. Freezing eggs, that's going to grow for the next 10 years. For all the reasons we know about people having children later, sperm counts are down. So we did, we started a company, what, uh, four months ago? We put in a million and a half dollars and we just signed a term sheet to raise, you know, five and a half million dollars. Um, a lot of people wanted to do it. People are excited about the team. Uh, we have, you know, good set of people, uh, mostly from Stanford Business School on this team. And it's a big space. So, uh, I'm, I'm going to bet on that team and that trend for a while.

• 33:02Sam Parr?

  What does that deck look like? You said they, they do like a, or I think a 50-page memo or deck. I'm not sure what you said. Do you have a structure for it?

• 33:09Speaker 02

  Yeah, it's generally one, just talking about the industry. Where are the problems? Where are the pain points? And then where are the opportunities? What's the product idea? So one of the reasons I do almost nothing in e-commerce these days is because I don't see the problem. We solved, the industry solved the problem. I mean, if you name anything on the planet earth, just about, you know, you can find a site, they'll have 10,000 of them. It'll be sent to your house by tomorrow. Man, I don't know how to do better. That problem is solved.

• 33:39Speaker 02

  Whereas when I, you know, when I started Gilt, you actually couldn't get Marc Jacobs at 50% off online. Just no one offered it. And so we offered it and people went crazy over that. So e-commerce is very mature. Frankly, media is pretty mature right now. There's a lot, you know, not that people say to me, I just can't find what I want to want to read. But even, you know, once in a while, we're working on one idea right now, the early stages in the media space, but not not sure yet. So we're looking for problems. The health, one of the reasons I like healthcare is because it healthcare is not solved. You know, as you guys know, you have knee surgery, either you or your insurance company are going to pay a crazy amount. One, there's too much knee surgery.

• 34:22Speaker 02

  It's gonna, someone's gonna pay 40,000, yet in France, it's 20,000 and the results are better. So can it be done better? Yes, it can be done better. You're 20 times more black women die in childbirth than in Sweden? Yes. Is that something that is just inherent and is always going to happen? No. We don't do enough prevention. There are many structural issues in healthcare that have not been solved and we're we're solving some of them.

• 34:48Shaan Puri?

  It sounds to me like what you do is you look, think about what's the world going to look like in 10 years? You know, either what's a problem that just, if somebody could solve it, that would be a major, major unlock, or hey, the puck is going this way. And then it sounds like you say, cool, let's go find out everything we can learn about that space. We go in kind of open minded about what problem we're going to solve. We try to figure out where all the pain points are. And then it sounds like you're looking for what I'll call the big obvious problem, which is if it's too complicated and nuanced, it doesn't sound like you're that interested. It's like, hey, you can't find luxury fashion online for 50% off, right? Okay, that's like a big obvious problem. It doesn't take that much

• 35:31Shaan Puri?

  explaining or expertise to even understand the problem. Maybe the solution might be, might take some expertise, but the problem should be in your face. Once, once you're looking in that industry.

• 35:42Shaan Puri?

  We, uh, we have this thing we say on the podcast, which is that there are businesses that that there are business plans that are what I call one chart businesses. You could just look at one chart and it just tells you, oh, that's, that's so obvious. Like we were looking at one that was around, um, uh, in the death space around cremation. And it was like cremation went from, I don't know, seven percent of all things to like 50%. It's now the majority of, uh, of, of, of what choices people make when, um, when it comes to a funeral. And this is like, that's a one chart business. You can look at nothing else and say, all right, I know there's, I know there's opportunity when I look at a chart like this. Um, is, is that, does that jive with your way of thinking? Or do you have anything you could add to, to our understanding of that?

• 36:24Speaker 02

  No, absolutely. I mean, I'll give you another one. The cost of labor is going to just keep going up. And so, you know, waiters were paid $15 an hour. Now it's 20 to $25 an hour in New York. Unless we change immigration or something fundamentally changes, that could be $30 an hour. So you know what? Over time, that changes the calculus of automation, whether it's making french fries, whether it's through this, we're all going to have to find ways to use less labor. And so when cost of tech goes down and the cost of labor goes up, what does that tell you? More automation is going to happen. Uh, so I'll bet on that trend all day long. You know, we're an investor in a company that gives robotic massages. There's 17,000 open positions for

• 37:08Speaker 02

  massage therapists in this country. And so, you know, there's hotels that just can't offer massages because they don't have the people. So, you know, we hope they're going to offer a massage. So that is just one example, but I have 10 others.

• 37:22Shaan Puri?

  We, uh, well, what are those 10 others? Uh, of just, of just automation or other ideas?

• 37:27Speaker 02

  No, just, I'll give you another example. Another company we invested in is so driverless cars is, as you know, not legal in most countries, most states, but having a remote driver is. So would you, if you're in New York City, would you pay money to have a car, a rental car brought to your apartment as opposed to you having to take your seven suitcases and two kids and go to the rental car? Of course you would. And yet, we can have someone in the Philippines or in Arizona drive the car because we put software and hardware in the car. They can see everything. That's legal in many states. Airports are already talking to us about the vans that they have to drive around to

• 38:10Speaker 02

  bring people to the rental car lots at 2:00 in the morning. Hardly anyone on there. You gotta pay someone double time, 40 bucks an hour. That should be done by someone remotely. So things like that are going to be automated.

• 38:23Sam Parr?

  So Sean and I, we've had a bunch of cool people on this podcast. So one of our great friends is this guy named Andrew Wilkinson. He owns maybe 40 companies, a lot of agencies and web stuff, mostly bootstrapped. It's publicly traded now. And then we had this other guy named Said, who's like 32 years old, who owns a bunch of WordPress plugins, basically, that- It's the bootstrap to unicorn.

• 38:46Speaker 02

  Wow, amazing.

• 38:47Sam Parr?

  And, well, which he owns most of. And so we have a lot of like, and I fall in this category as well. I bootstrap a lot of my things. And then there's this other category. So there's a category of people who like bootstrap stuff and just use their cash flow. And then oftentimes, that same group of people prefer to go and buy companies as opposed to build them from scratch. You're taking the opposite approach a little bit where you're like, I'm gonna fund it. It's not gonna make money at first, but I'm, and I might go and raise a shit ton more money, but this might be a huge idea and I'll own a small piece of it. What, like, have you ever considered the bootstrapping model or is your, you just go big right away? And have you ever considered buying? What's your like buy versus build kind of mindset?

• 39:31Speaker 02

  Yeah. So it really depends on the type of business. So if you're running an agency, you just don't need a lot of capital. You hire five people who, and then they, agencies make money and then you use that money to reinvest in growth. If you're building, what I'm building is closer to like a hotel. You know, you have to build the whole building before anyone comes and stays with you. So a little different because like Mongo, you gotta take years to build a good enough product. And there's no way to bootstrap that. You know, it takes 20, 50, you know, they're a hundred million dollars generally for those types of companies to get there. So that's why it's not an option for those things. Look, I would love to have companies that, you know, I could own all of.

• 40:13Speaker 02

  For example, the, the agency that I have, I said, those engineers, I basically have an outsourced engineering company. I own all of that because it has clients and it builds as it gets more clients. But those businesses are not as scalable, profit margins are generally lower. Those are the not type of businesses I generally go out.

• 40:32Shaan Puri?

  Why is that? Is it just a matter of you just enjoy something more? Do you think that one is a better, better wealth creation? Are you, I mean, what's the motivation?

• 40:40Speaker 02

  I just prefer creating a product, a real product that's hard. And then, you know, making more scalable and building it up over time. The vast majority of quite successful companies are in that category. The services oriented companies, you know, it's harder, it's harder to get to be a unicorn. It can happen, but there aren't, there aren't that many.

• 40:58Shaan Puri?

  You over time gotten more selective on the project selection? Cause I look at, you know, you did Business Insider. I think you were the, were you the CEO for like a period of time there? Nine years, is that right? No.

• 41:09Speaker 02

  No, I was the chairman for all nine years. I did step in, I did step in to be the CEO of Gilt. When we were growing really quickly, I just decided that I was the right person at that point for probably two or three years. But otherwise I've been chairman of many companies for 15 years. I stepped into Mongo, I changed CEOs about eight years ago. And for three months I was de facto the CEO as I was doing.

• 41:33Shaan Puri?

  So you've run these for a period of time, but mostly not. But, but I guess when I think about businesses, I look at my career and it's like, I look back and I think, okay, of these 10 things I did. Two of them were like ate up all of my time and gave me a bunch of gray hair for like relatively less payoff versus these other two, which was like, I just kind of wrote the check. It was an obvious opportunity and it just paid me and it was wonderful. Have you like, what's the best business that you've done in your portfolio that you look back on that has the combination of the value, the pain that it took to get there, you know, all of that. And then do you have a framework around there? Or do you think it's just luck of the draw?

• 42:12Speaker 02

  I think it's like the draw. I mean, Mongo is the one where, you know, I got the most return for the least amount of money. I mean, I essentially never worked there full time. So chairman for 13 years, and yet it's a super valuable and, you know, fascinating company that's going to be around for the next 50 years. But, you know, I'm intellectually curious. So what I love about what I do is that, you know, in an hour, I might be in a meeting on psychedelics and then on, you know, semiconductors and I have to try and keep up and learn something about these. And that's what so, you know, we have one in cardiology. There's so many different things. It's, that's what's amazing.

• 42:51Shaan Puri?

  And for someone who's thinking about 10 years, I'm a little surprised. I don't see AI all over this doc. You know, you're not saying AI, AI, AI. It sounds like it might be embedded in some of these things that you're doing, like, might be a tool you use, but are you bearish on it for some reason? Or what's your thinking around AI?

• 43:09Speaker 02

  No, I say two things. One, it's coming down now, but if it were six months ago, you know, the pricing on AI was insane. Now, three people walk in and say, we're worth $100 million because we're going to put together an AI company. Just didn't make sense. So we didn't make any direct investments there. Each, we're really encouraging each one of our companies to use AI. And I think the, you know, the real use of AI in the short term is going to be much more mundane. It's optimizing customer support, you know, making your coding more efficient, the things like that. We're a long ways before, you know, true AI companies are coming, but it's, but it's on its way. We did something unusual this summer. The, our entire technology team shut down for a week. Went home and their only assignment was to learn about AI the entire week.

• 43:55Speaker 02

  Read about it, think about it, talk to people.

• 43:57Sam Parr?

  John did that too.

• 43:58Shaan Puri?

  Yeah, I did the same thing. I shut down for a week.

• 44:00Speaker 02

  Yeah, just to get up to speed because it is a very important thing that we all need to be thinking about. And then came back, you know, compared notes and made sure that our companies are thinking.

• 44:09Shaan Puri?

  Did you do it too or just the engineers?

• 44:12Speaker 02

  I do. No, these are not engineers. This is the investment people on the, on the tech side. So I do it on a more continual basis. You know, I'm spread thinner than other people. So, you know, I have 60 board meetings a year. I have a lot of things I have to. I can't shut down as easily unless I'm at Burning Man or Antarctica.

• 44:31Shaan Puri?

  As one does.

• 44:33Sam Parr?

  Nice flex. I love that.

• 44:35Speaker 02

  Then I'm off the grid and I don't have a choice.

• 44:38Shaan Puri?

  I'm going to change all of my, my, my auto reply things to I'm in Antarctica, even though I'm just actually in town.

• 44:46Speaker 02

  The only two times I'm truly off the grid.

• 44:49Sam Parr?

  You are, you, you like violate this rule that I have for myself and you do it so wonderfully, which is focus. Or at least it appears as, as you do, you like launch like, I don't know. How many companies a year do you launch?

• 45:01Speaker 02

  Eight.

• 45:02Sam Parr?

  Eight? God damn. And you could do eight now, but I don't know how big your team was early on, but it seemed like you were still creating a lot of companies.

• 45:10Speaker 02

  I mean, generally it was one a year, one a year. Um, there was that one year where we did three between the two of us. But I would never be able to do eight on my own. I mean, they, they take real time.

• 45:20Sam Parr?

  If we are, if the roles were reversed, you know, I look up to you. If you were a 23 year old and you looked up to me, I would say, man, you gotta do one thing well and that will pay more dividends.

• 45:30Speaker 02

  I agree.

• 45:30Sam Parr?

  Oh, well, great. So what's your like opinion on that then?

• 45:33Speaker 02

  No, no. So I think that anyone, I, I, people come to me all the time and say, look, I'd like to have a studio like you. And I'd say, look, don't do that. Start by trying to start a successful company and end up not being a CEO. That's already not that easy. You know, if you have that and six months later, the company has raised its external round of financing, has a full management team in place and you are its chairman, you can then decide to do another one. You can't truly be CEO of multiple companies, but you can be chairman of multiple companies. But you gotta start with one. And if you try and do two or three at the same time on your own, it's not gonna work. It's not that easy. You know, I have 25 people.

• 46:15Sam Parr?

  What does a chairman actually do?

• 46:17Speaker 02

  So a chairman is one, in this case, is the ultimate person that's gonna be around 15 years from now. The CEO may change. This is a person that's gonna guide it and is a co-founder. You know, if along the way somehow Henry Blodget had quit, that's my problem. I need to find a CEO. I need to solve that for the board. So you're just the most active board member. We had other investors, but everyone knows they got one company that is gonna have a tricky financing round. And we need to get the internal investors together. Not gonna be easy. I need to do that. So I'm having calls with all them. I need to wrangle everyone, encourage them, push them, come up with the right thing.

• 46:56Sam Parr?

  And what type of relationship do you have with your CEOs? Like before it's like, you know, in the first one, two, three, four years? How often are you working with them?

• 47:04Speaker 02

  Yeah, so I mean, there, we're gonna have a call probably every week or every two weeks soon to touch base. And then they reach out if they need something. I mean, I love the relationship. I feel great about the relationship because, you know, I don't want their job. If I wanted their job, I would have taken their job. I want them to succeed. I don't, you know, I don't wanna be CEO of one company. And hopefully I can stay out of the way because they know much more about the company than I do. But there's certain things where I have either relationship, some experience, tricky issues, introduction to a VC firm, where I can add value. And so I love that relationship.

• 47:43Sam Parr?

  I like you so much because you do things. Okay, so Sean and I are in this like stupid Twitter world where like a lot of our friends are popular on the internet. And there's this whole thing that I don't buy into of like build in public and like use your audience. But like it's people selling like hundred dollar a month things or something like that. And you have these like really big ideas, but also like for how successful you are, we take pride in like finding interesting people who are like amazing, but not incredibly well-known. You are really good. You're one of the higher people on this ratio of like pretty low-key, under the radar, but has had massive impact.

• 48:22Speaker 02

  Exactly what I want.

• 48:23Sam Parr?

  And like you don't have an audience. Like you violate all these like stupid rules that people talk about.

• 48:28Speaker 02

  I do no social media.

• 48:29Sam Parr?

  Why is that?

• 48:31Speaker 02

  You know, it's I look, I think other people use it very well and they like doing it. I don't want to spend the time. I don't want to do it. I don't want to. I don't need to be out there. That time should be used for thinking time and managing time. And so, yeah, no, the people around my marketing team know that the goal is that we are very successful. And that when I walk into a restaurant, no one knows who I am.

• 48:55Sam Parr?

  Yeah, I mean, I just think it's awesome. Well, I but you you're on like CNBC and shit like that. Every once in a while I'll see you there. I think there's rumors that you're you're gonna run for mayor. Is that true?

• 49:05Speaker 02

  So two, one is you haven't seen me on TV in a long time.

• 49:09Sam Parr?

  Right. Yeah, that was you. That was about four or five years ago. I think I was like leaving your office or something like that in the Yahoo building. Or maybe I was at a friend's. I saw you on TV.

• 49:17Speaker 02

  Yeah, that'd be right. I don't think I've been on for at least five years. So, yeah, I don't, you know, actually podcasts are the only thing I do because it's sort of enjoyable. You don't need to prepare. You have a good conversation. So I've done that. But I other than that, I do almost nothing. I did think about running for mayor, you know, eight years ago. I've been very involved in politics in many ways, representing tech community in in every dimension.

• 49:46Speaker 02

  All my life, I thought I would want to. That'd be the one other thing I'd want to do. And then decided, you know, seven years ago that I didn't want to do that. It's it's a miserable process. You know, if you said to me, you could be mayor tomorrow, I would actually do it. If you said to me, no, no, what I mean is that you can be one of seven candidates. You can spend eight months getting the shit kicked out of you and being humiliated.

• 50:05Sam Parr?

  Like, uh, I'm gonna be in Antarctica that week. Sorry, guys. Like, can we do this next week?

• 50:10Speaker 02

  No, and you're you're telling me I can't go see my kids who are, you know, at various points all over the world. And I get to see them all the time. We do great things together. And so that's a big trade off that I don't want to make anymore. So I'm gonna keep doing what I'm doing for a long time.

• 50:26Sam Parr?

  You were involved in one company that I always, that I think could still work and it didn't work. But you almost had it. So you invested or were a board member, you were heavily involved in, I think, in hot jobs, which had an exit, but you did this other one called The Ladder or Ladders. Where at the, this was in the mid 2000s where like a hundred thousand dollar job was considered good. And it was like, I think if I remember correctly, I don't remember if the user paid or if the job company paid, but it was a job board. That's kind of dismissing it, but it was a job site for hundred thousand dollar jobs.

• 50:59Speaker 02

  Yep.

• 50:59Sam Parr?

  And I remember seeing that. I was like, that's pretty cool. And I tried launching a company where the user would pay a subscription. And then editorial person would try to survey and effectively find out what it's like to work there as opposed to the company like telling you the best, the best, like, you know, like the best stuff. But I always, you're always, you had a couple of companies in like the job space. I've always thought that that was pretty cool and I always thought that that could have been done effectively. I remember the, was it Ladders or The Ladders?

• 51:32Speaker 02

  The Ladders and it's still around, but not nearly as successful as it was. It started in 2004. I was one of the early, early investors and it's, it's actually still there. I lost, you know, LinkedIn basically, you know, did a much better job. I'm an investor in Ripple Match, which is a jobs oriented company aiming at people in college. The job situation is still not fully solved and that's going to be one where, you know, AI will be used intelligently. As a recruiter, as you know, it takes enormous time to figure out the 50 resumes you should look at, reach out and say, can I have a phone conversation with you, respond to that? Hours and hours and hours and hours and hours and that needs to be productized.

• 52:15Speaker 02

  And we're on our way, we being my company as well as many others. Hasn't been solved.

• 52:20Sam Parr?

  Has Ally, has Ally Corp ever taken any financing or are you strictly using your winnings? Like, and how much did you use to fund the company when you first started?

• 52:29Speaker 02

  Yeah, I didn't do that much, but I, you know, I've invested probably $250 million into the various companies over the years.

• 52:38Sam Parr?

  And that came from like the

• 52:39Speaker 02

  The various companies.

• 52:41Sam Parr?

  Sale. But you but do you take cash flow from anything? Or is it strictly you? Yeah, is your income lumpy or not your personal income?

• 52:47Speaker 02

  Oh, yeah. No, I don't. I haven't gotten paid in a long time. I'm purely just investing my own money, but I have a whole infrastructure and a whole firm that does that. So it's like it has historically been a single LP fund. Everyone has carry. It's no different than Unswear Ventures or Thrive or anything else. Just has one LP instead of many.

• 53:05Shaan Puri?

  What are you looking to change or improve? So if we talk to you 10 years from now, what do you hope? What do you hope is different about you or your lifestyle or your businesses that versus today?

• 53:17Speaker 02

  So I'm doing most of the things I want to do now. So one, you know, it's going very well. Results have been great. I spend three to four months a year in Europe, working from there. I grew up in Europe. My wife is French. I have one child there and I enjoy that. So I'm planning on continuing that. Want to keep doing various, you know, athletic and interesting trips around that, that, you know, that, that, that I enjoy. So from a high level, I'm not planning on changing it dramatically. The I'd actually love what I'm doing. I think we're having fun and we're going to continue to do this. I don't want to make it much bigger. You know, I don't want to have that many more people.

• 54:00Speaker 02

  That'll just make it more sort of system oriented where I'm not close to the companies. Because what I enjoy is when I'm close to the companies and the problems. And that's where I think I I add value. I'm just trading off. I'm very old at this point in this industry. And so I'm, you know, hopefully reaping the benefits of the judgment that you get after dealing with these things and making lots of mistakes along the way. But a bunch of things going well.

• 54:25Sam Parr?

  And another thing that I like about you is that, um, You're very emotionally stable. Like every time, you know, I've only talked to you three times, but like you are quite logical and like you seem like a guy who isn't rattled. And I read an article about Business Insider selling and I think the article said Henry Blodget is a very emotional person, which is makes sense because he's a journalist. He's a great writer. And during the sale, I think someone was, I think he was like, I'm not even talking to Axel Springer, whoever bought it. Kevin has to do it. Like I just, I can't even be in that room. And like, it was like, all right, Kevin steps in and he's the reasonable one, or he's like the emotionally like-

• 55:04Speaker 02

  I negotiated, I negotiated the entire deal. And, you know, and look, I could not be a bigger fan than I am of Henry's, but it would be like if, if someone kidnapped your daughter, are you a good negotiator with the other side? And the answer is no. Right. You're like, give them everything. You know, we could just get her back. So we need someone else to do that. And so it was better for me to do it. He was very nervous because I was pushing to get a higher price. And, but we did, you know, we were doing 40 million at the time. We sold it for 11 times revenues, which is a big, big number for a media property.

• 55:38Sam Parr?

  Insane. Yeah, it's insane. We're good friends with, one of our best friends is Austin Reeve, the founder of Morning Brew.

• 55:44Speaker 02

  Yeah.

• 55:45Sam Parr?

  And, and they're, they're killing it for, for BI and-

• 55:48Speaker 02

  Great. That happened after me, but great acquisition. I still get that product every day. I think they do a really nice job, have a great editorial tone. But you're right, I'm, I'm don't, I mean, this, I think it's important to not get too emotional about any one company. And that's one of the things I can bring to the table. But when you're CEO, you're just so close to it. You're, you're, you're in the forest. I can step back a little bit and sometimes say, look, you know, this is going to be bigger than you think. And we should, you know, double down or it's not working and let's figure out a way to sell this. It's easier for me.

• 56:21Sam Parr?

  A question that we, that we like to ask people is like, what do you do with your money? So like if, if, you know, of your, of your pie chart of your 100% portfolio, how do you, how do you allocate? To different stuff, you know, do you have public equities and just normal bonds and stuff? Are you all in on private company? What are you doing?

• 56:39Speaker 02

  All in on private companies. So probably 90% of my net worth is just in my own firm in investing in various companies and things. I have a little, I have some in some VC and private equity firms now as an LP. You know, and I do have some real estate. I bought a building, a commercial real estate building between on Mott and Broome. In between Soho and Bowery. And so when you come visit in a year, that'll be the Ally Corp headquarters. There'll be a restaurant in the, in the, in the retail floor, five floors of commercial real estate and an amazing roof deck with parties for 150 people and dinners for 30 people up there. So it's going to be a real tech center.

• 57:25Speaker 02

  So we're, it was a shell of a building and construction starts in a week. We've designed it over the last nine months. It's a super fun project, but it's also a diversification for me and owning some real estate.

• 57:36Sam Parr?

  But you don't have any public, public equities?

• 57:39Speaker 02

  No.

• 57:39Sam Parr?

  Other than, I imagine you still own stock in.

• 57:43Speaker 02

  Yes.

• 57:43Sam Parr?

  But like you don't, you don't have any boring indexes, really? Are you heavy on cash?

• 57:50Speaker 02

  Yes, I always keep a lot of cash. I need to keep a lot of cash because I don't have, you know, I don't have a salary. So, and I don't know when money's coming back.

• 57:59Sam Parr?

  Where do you keep your cash? Just in a, in a, in as simple as a high yield savings account?

• 58:04Speaker 02

  Yep, yep, exactly. I need to be super liquid.

• 58:08Sam Parr?

  Dude, that's so fascinating. This is awesome.

• 58:10Shaan Puri?

  Evan, thanks so much for coming on. We, as you can tell, big fans and what you've done is pretty incredible. Also, I think there's just like what you do about thinking about where the world is going, what ideas, what opportunities, what problems. It's also, you know, the premise of our podcast, when we don't have guests on, that's all we're doing. We're thinking about that and we're, we're brainstorming what that could look like. And so our entire audience is people who like hearing about those opportunities or stories of people capitalizing on them. So I think this is a very, very good fit. Thanks for, thanks for doing this.

• 58:39Speaker 02

  Right, well, thanks for having me on. This was fun and again, good to reconnect.

• 58:43Sam Parr?

  And I hope you realize like I'm not just talking shit like you had a really big you you you've had a big impact in my life and I'm going to be following a bunch of stuff that you do and and I have this document that I it's like 500 pay 500 words of the notes that I took when I talked to you and I've and you actually predicted that how much we were going to get acquired for by the way you

• 59:03Speaker 02

  Oh, really?

• 59:04Sam Parr?

  You nailed it. Yeah, you nailed it. You said, I think in two years you're going to get bought for about this much. You nailed it. You predicted two other acquisitions in the media space as well in my notes. I'll share it with you so you see the notes, but you've had a really big impact on me and it's really cool to talk to you and hopefully we could stay in touch.

• 59:21Speaker 02

  Of course, we it sounds like we need an in-person meeting. We need to get together and and see what the next five years are going to look like.

• 59:29Sam Parr?

  Let's do it, man. I would love that and we appreciate you. Thanks for coming on.

• 59:32Speaker 02

  All right. Thanks.