#192 - Making Billions with Greeting Cards, How the FBI Took Down Thousands of Criminals, & Rich People (not) Paying Taxes

Shaan (@ShaanVP) and Sam (@TheSamParr) break down the greeting card industry. They talk about digital cards and the staying power of card subscriptions, a new way to send gifts over social, and Shaan shares a story about his roots as a business operator. They discuss a subscription business for expecting mothers and Shaan shares an interesting story about the FBI. The end of the episode they talk about a little known Billy of the week. --------- * 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: * (1:23) Recap of episode * (2:54) Making billions with greeting cards * (5:46) Segue: how the podcast changed Shaan's brain * (8:51) Back to greeting cards * (9:56) Making millions for decades at birthdayalarm.com * (15:54) Givingli & Hooked * (18:39) Thoughts on the Pro Republic article * (25:28) The subscription for expecting mothers * (34:20) Outpacing the S&P with the anti-Galloway Index * (37:33) The secret FBI crackdown on criminals * (40:51) The growth of privacy focused apps * (43:20) Recapping the genius of Mike Maples * (48:35) Technology at Chick-fil-a * (54:53) McKinsey for tech consulting * (56:55) Consensys * (59:27) The Gordon Bombay of crypto * (1:04:19) The hypothetical invisible medium that permeates the universe

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

• 0:00Sam Parr?

  I think that you've said a lot of amazing stuff for the past two years. I think what you just said right there actually might be one of the most valuable rants in terms of just money that you've ever said.

• 0:22Shaan Puri?

  What's up? It's me, Sean and Sam, the Vanilla Gorilla.

• 0:26Sam Parr?

  All right. We have a good episode today. Sean just said he thought this was an amazing episode. We talked about a lot of different stuff. You have a list. What did we talk about?

• 0:34Shaan Puri?

  We talked about the surprisingly big business of greeting cards and e-cards. We talked about the crazy Chick-fil-A tech stack and some ideas around that and creating a consulting company around that. We talked about this crazy FBI takedown where the FBI basically tricked thousands and thousands of criminals with a pretty genius app. What else? You did a good bump boxes breakdown and-

• 0:58Sam Parr?

  A bump box of a guy who's built a business that sells subscription boxes to pregnant women and their babies and it's like $40 million a year. The babies don't buy it. They might, but it's meant for the babies.

• 1:11Shaan Puri?

  Right.

• 1:12Sam Parr?

  That does $40 million a year in sales. And we talked about how this article that came out about rich people not paying taxes. Well, we talked about how they actually get money to live, which was kind of mind blowing to me.

• 1:21Shaan Puri?

  And then we talked about one of my favorite childhood actors and childhood movies, how that young child actor has become a crypto billionaire. And then I got excited saying he's the Billy of the week, but that's all to come in this episode.

• 1:34Sam Parr?

  And do me a favor. Go to your Spotify, go to your iTunes. There's a button that says subscribe or follow. Follow if you're on Spotify, subscribe iTunes. Click that button because when you click that, we go up in the charts, we go up in the charts, we get more listeners and we get more listeners, we get to record more stuff. Please do that. Thank you and have a good episode.

• 1:52Shaan Puri?

  Well, first, happy birthday. You're, you're what, 31?

• 1:57Sam Parr?

  32.

• 1:58Shaan Puri?

  32 now? Okay, great. Good. I was feeling bad. I'm 33 and you're always like, yeah, we're basically the same age. We're both 30, 31.

• 2:04Sam Parr?

  I do it to slight you. I do it as a joke because you're only a year older than me, but I want to make it clear that you're older than me still.

• 2:11Shaan Puri?

  Yeah. Yeah. And in my head, I immediately stopped listening to everything else you say and I just start thinking in my head, fuck, I'm older than Sam. And then I have to be like, why does that matter? Who cares? And then I get back and I don't even know what's going on. And you're 35. Okay, great.

• 2:25Sam Parr?

  I do it.

• 2:26Shaan Puri?

  Dan will feel even worse now.

• 2:29Shaan Puri?

  My trainer, by the way, he's at a forty, forty-one, something like that. And he looks great. Looks like he's twenty-five. And anytime someone's like, oh, wow, I didn't know that. You know, once they find out his age or whatever, he's just like, he's like, I'm living to one hundred and five. And he's constantly watching videos of people who are like a hundred and five, but healthy or like a hundred and they have like, you know, they're still like madly in love with their husband or wife. And he's just constantly watching these videos, these outlier examples to be like, that's me. I'm gonna have that life. Do you care about living till you're like really old?

• 3:00Sam Parr?

  Yeah, well, I tell everyone one thirty.

• 3:02Shaan Puri?

  One thirty? Okay, great.

• 3:04Sam Parr?

  I say, I'm gonna be one thirty, but I'm gonna, I'm gonna act like a current seventy-year-old. Like my, like the seventy-year-olds now, that's what I'm gonna be when I'm one thirty.

• 3:14Shaan Puri?

  Okay, why one thirty? Where's that number from?

• 3:17Sam Parr?

  I think it's a nice, ambitious, but realistic number. I think that, so I went out with this guy the other day and he is a, no, I'll, I'll name drop. You'll kind of name drop. I went out with Lance Armstrong. I got dinner with Lance Armstrong.

• 3:30Shaan Puri?

  Dude, you weren't gonna say that? You were just gonna say, I went out with this guy the other day?

• 3:34Sam Parr?

  Yeah, well, yeah.

• 3:35Shaan Puri?

  Amazing.

• 3:38Sam Parr?

  I had, the reason I'm saying that is like, it come from a reputable source. And he had this guy who worked at Adidas and Nike with him, this like huge ripped guy who was like, he's probably fifty-five or so. And he was telling me that there's a direct correlation between lean muscle mass and age. So like longevity. So the people who have more muscle at an older age are more likely to live longer. And so that was like a realization to me. So anyway, that was a-

• 4:06Shaan Puri?

  So two for one. You get to be jacked now and live forever.

• 4:09Sam Parr?

  Yeah. But, wait, what were we talking about? Oh, yeah.

• 4:14Shaan Puri?

  Living old.

• 4:15Sam Parr?

  But I, so we just did this little thing. Well, let's get back into it. I got a card, an email from my aunt, my aunt Debbie, who's in her fifties called, I forget what it was called, but it was American Greetings was the name of the company or the main, I, whenever I get like one of these things, I scroll straight to the bottom and it says like the name of the brand, but then it says like copyright, American Greetings.

• 4:34Shaan Puri?

  The like terms and conditions part.

• 4:36Sam Parr?

  Yeah, I'm like, all right, that's the good stuff. So I always like Wikipedia. And it was this company, it's a greeting card company that does-

• 4:43Shaan Puri?

  By the way, can I pause you one second? That thing you just said, that this podcast has like rewired my brain where that's all I do now. I'm like, oh, cool. This thing is in my life. Who's behind this? How much do they make? What's the company? What's the backstory? Is there an epic founder behind this? I was at the dentist. And he's showing me an X-ray of my teeth yesterday. And instead of looking at the, he's like pointing out something in my teeth. He's like, oh yeah.

• 5:06Sam Parr?

  Who makes that machine?

• 5:07Shaan Puri?

  I'm looking at the name of the software in the top left corner. It's like VM, you know, VM imaging. And I'm like, I'm like, hey, can you hand me my phone real quick? I need to just, I need to write this down. I'm going to go look up this company. I bet it makes like billions of dollars doing this X-ray software for dentist's office. Or like, he was like scraping my tooth with some tool. And I was just thinking, why isn't there like better divide? This was the same scraper they've been using since like I was 10. Who, if every dentist is buying these things, these things can't cost, they have to cost a lot of money. Who's, what's the company that makes these little devices? And are they innovating? Why not, you know, blah, blah, blah. So my brain has been like, I have like this chip in my brain now that that has to get to the root source of every product. I feel, which is what you did.

• 5:47Sam Parr?

  Whenever I see a building.

• 5:48Shaan Puri?

  Sent you a birthday card.

• 5:49Sam Parr?

  Well, when I see a building, like a huge warehouse, if that, like if it's a massive warehouse and there's a sign on it. I always look up, what's the story of that?

• 5:58Shaan Puri?

  Right.

• 5:58Sam Parr?

  I always do that. So yeah.

• 6:00Shaan Puri?

  I was thinking like, you know, people are excited about AR or like when Google Glass came out. And they're like, oh, it's great. You'll be able to read your email or you'll be able to like see directions, you know, like the map will be in front of your eyes. And I was like, the killer app of this is I just look at somebody and it tells me who they are. Like I can just like, you know, like when you, you stalk someone, you meet, you see someone interesting, you like, try to look them up. You find their Instagram, you see what their life's all about. I think it's going to be amazing when we just have contacts or glasses. And I could just look at you, it'll be like Sam Parr, CEO of the hustle, blah, blah, blah. Your last two tweets next to your face floating above you. You have no idea that I just have like, you know, interrogated you.

• 6:37Sam Parr?

  There's also practical stuff. Me and Sarah were walking on the street the other day and Sarah saw a guy with college shirt. And she's like, I think we know that person, but I can't tell because all white guys with college shirts look, look the same to me.

• 6:49Sam Parr?

  There's some practical, there's some practical implications. Dude, when I was a kid and I would use my fake ID, I had a fake ID. And the guy was a white dude, but he had like a shaved head and it was like, he had clearly had black hair. But if you go to the Indian or the black stores with like a black clerk, like a different, a clerk of a different race. They all thought that like all white people.

• 7:13Shaan Puri?

  Yeah, looks just like you.

• 7:15Sam Parr?

  And so the, the joke was you have to go to like a person who's not white. Cause they all think we look exactly the same.

• 7:23Sam Parr?

  Did you ever do that when you were a kid? Like you go to like, you gotta go to the white clerk?

• 7:27Shaan Puri?

  I didn't realize that hack, but that makes perfect sense to me.

• 7:31Sam Parr?

  Do you think all white people look alike?

• 7:34Shaan Puri?

  No, not all white people look alike, but definitely like, you know, John, Jeff and Jacob, you know, I might mix them up from time to time.

• 7:43Sam Parr?

  Yeah.

• 7:43Shaan Puri?

  In the same way that, you know, I look like, you know, Aziz Ansari to everybody. You know what I mean?

• 7:48Sam Parr?

  Right.

• 7:49Shaan Puri?

  Yeah.

• 7:50Sam Parr?

  But we were talking about American greetings, American greetings. And the reason I bring this up, huge company, and it's just crazy that this shit still exists. But I guess it's not that crazy.

• 7:58Shaan Puri?

  So just to explain in simple terms, they do e-cards. So you can send a digital card to somebody.

• 8:03Sam Parr?

  $20 a year. Yeah.

• 8:04Shaan Puri?

  $20 a year membership. And they do above a billion dollars in revenue. They own multiple smaller brands. So they own like Jackie Lawson. Have you ever heard of Jackie Lawson, by the way?

• 8:14Sam Parr?

  No.

• 8:14Shaan Puri?

  You should Google this name. So Jackie Lawson, go look at her website. And like, welcome to 1982. So just, I mean, whoever's doing the video on this, you gotta pull up the Jackie Lawson.

• 8:27Sam Parr?

  I love Jackie Lawson.

• 8:29Shaan Puri?

  Literally. Okay. So the, the profile photo looks like, you know, some bootleg Carmen Sandiego. And then it says Jackie Lawson. And then like, there's like, a mouse, like a computer mouse is like, like part of the N, because probably like when she invented this, it was like new to be like on the computer, sending cards to people. And this thing is incredibly popular. People love Jackie Lawson cards. She's like really well-known, sold her company, I think to American greetings. And I ran a company for a period of time, maybe a year or two. It's called birthdayalarm.com.

• 9:02Sam Parr?

  That's why I didn't bring this up, by the way.

• 9:03Shaan Puri?

  Yeah. I didn't start this company, but the company's kind of remarkable. I'll break it down. So Michael and Zochi Birch were the investors in my previous company. This was their first win. So Michael's a programmer at an insurance company. He's like, ah, this is boring. Wants to go do a startup. He comes up with this big idea to do a self-updating address book. Meaning like, what if you had a contact list that was like dynamic? So I'm in your address book. If I ever move, I can just change my address or my, my email address or whatever, and it'll automatically update in everyone's contact list dynamically. So you have this idea of this. He builds this, this product. It's really complicated. It's not really going anywhere. But he adds one feature to the address book, which is,

• 9:48Shaan Puri?

  Uh, birthday, what's your birthday? And, um, which is ironically the thing that doesn't change. It's not, you don't need a dynamic address book to do that. But he started sending reminder. So like a little reminder would come out like, I should have got a reminder yesterday that said, hey, it's Sam's birthday today. Wish him happy birthday. And, um, and this was before Facebook. So this is actually an incredible, incredibly useful thing. So people used to email him being like, hey, um, thanks so much for that birthday reminder. I would have totally forgot my aunt's birthday. You know, you saved me on that one. Or, you know, I looked like husband of the year because of that birthday reminder. And, um, so he's like, shit, nobody likes my thing, but they just like this one feature. So he makes that the product. So he goes and he makes it birthdayalarm.com. And all it does is it reminds you of your friends and family's birthday.

• 10:31Shaan Puri?

  And, um, immediately the, the site starts to like, do a little bit better, but not like, not gangbusters yet. So he says, okay, well, how does this product work? I should be able to email all my friends and family and say, hey, add your birthday to my, my, uh, birthday alarm calendar. And, um, and then he, he does, he, at the time, there was no term for viral marketing. But he's like, I don't have a budget to do, you know, I quit my job to go try to make it big in the startup world. So I don't have a marketing budget, so I need one user to recruit another. So here's what I'll do. When I email all my friends and families to add their birthday to mine and they go type in June 15th, then it'll say, do you want to save Sean's birthday in your calendar? And they're like, oh yeah, sure, why not? You know, tit for tat. He just asked for mine, I'll take his.

• 11:14Shaan Puri?

  And then it says, cool, your birthday, your calendar has one birthday in it. Who else's birthday do you want to know? Send this to your friends and family. So that became the viral loop. And all of a sudden he started getting tens of thousands of members. Still a free product, but tens of thousands of users at the time to him felt like a million dollars. It was like, oh my God, I've actually made something that's growing. And then he's like, all right, how do I make this even better? So he's just, he went all in on this virality piece. He didn't try to figure out the business model or anything. He's like, how do I make this even more viral? And so he's like, well, today, there's still all these steps involved. I gotta. Type in each person's email address. I have to figure out what to write. So he starts one by one changing these pieces. He's like, oh, instead of you having to think what to write,

• 11:56Shaan Puri?

  I'll write it for you. Just copy paste this, right? Here's a copy button to copy this into your email client. And then he's like, could I just send this to their whole email address book? And at the time, nobody was really doing this. And so he wrote one of the first scrapers for Hotmail, where you could just log into your Hotmail. He's like, great, I imported all your contacts. Just hit send and it'll send to all of them. And he's like, dude, this is kind of crazy. Like, he's like, for sure, Hotmail is going to shut this down in 10 days. But whatever, 10 days of growth, let's do it. And so immediately, he wakes up next morning, and there's like 100,000 members. And it just keeps growing exponentially after that. And, you know, here we are. He started that website in like 2001. So 20 years later, you could still

• 12:38Shaan Puri?

  do that thing in Hotmail and Gmail where you import your address book. They never were able to like fully shut it down. And so he's like, that hack that I thought would last 10 days lasted 20 years. And the site started growing exponentially. So now it has, you know, it's had over, I don't know, maybe 100 million members at this point, add their birthdays.

• 12:55Sam Parr?

  And wasn't it making like $5 million a year every single year?

• 12:58Shaan Puri?

  So at that point, it's free. Now, what happens is, his buddy Morgan, who's like a friend of his, sends him a link to, I don't know what it was. It was either Jackie Lawson, American Greetings, Blue Mountain, one of these websites. He goes, dude, you should do eCards. I made an eCard website. You should add eCards. That could be the business model. Sell birthday cards, right? Don't just remind them of the birthday. Let them wish them a happy birthday. Turns that on, immediately starts making $10,000 a day or whatever. Numbers are not exact. In fact, we re-released his episodes. You can go listen to the exacts. But basically starts making money. That business with just like, pretty bare bones. So it was him working on it, his wife working on it, you know, his sister-in-law did the books. And there was like, you know, cousin did customer support.

• 13:43Shaan Puri?

  It ran like that for a number of years and just had like outsourced people making e-cards. And it was making at its peak, four or five million dollars a year of revenue with most of that being profit, like maybe 80% profit at that time. And it ran like that for a number of years. He used that to self-fund his next startup, a social network called Bebo. And then because he self-funded it with Birthday Alarm, when he sold Bebo for 850 million dollars, the husband and wife duo, they owned like 70% plus of the company because he had self-funded it using this e-card website. And so when I went to go run his idea lab, that was still the cash cow that was paying for that fancy office you saw, all those Silicon Valley engineers.

• 14:24Shaan Puri?

  Most of it was because Birthday Alarm was still cranking $2 million a year of profit, even though nobody was working on it and there had been no updates for like multiple years at that point. And so then I took it and we tried to like turn it around and make it grow again. And so it started to grow again, you know, after we worked on it. But because of that, I looked into Jackie Lawson and American Greetings and Jib Jab and all these different companies. And this space is actually pretty big.

• 14:48Sam Parr?

  Yeah, well, that's why I brought this up is I knew I would get a story out of you like that.

• 14:52Shaan Puri?

  There's also one other company that somebody who listens to the podcast had told us, I'll give them a shout. Have you seen this app called Givingly?

• 14:59Sam Parr?

  No.

• 15:00Shaan Puri?

  So it's a, it's a new age version of this same idea. So Givingly, what they do, what they make easy is that they're like not just good-looking cards, but a gift card to like any service. So like it was my trainer's birthday, I wanted to get him something. I had forgotten to give him a gift. And so I sent him a Givingly, which was like a beautiful little e-card I made on my phone in like, you know, five minutes. And then I was able to attach like a hundred dollar DoorDash pass to it. So it's like, oh, dinner tonight's on me is what I sent him. And, um, and so it was like so easy to send a gift and a gift card. And I was like, oh, this is actually kind of interesting. And so I talked to the founders and their stats are honestly pretty impressive. People send a ton of these and the way that they grew is a little unconventional.

• 15:44Shaan Puri?

  They grew as a Snapchat mini-app, which like you kind of don't hear anyone talking about. Like, do you ever hear about Snapchat minis?

• 15:52Sam Parr?

  No, I don't even know what that is.

• 15:53Shaan Puri?

  They, they released this like app platform called minis. And like, you never really hear anybody talking about it. And then when they showed me their numbers, I'm like, dude, where are you getting like hundreds of thousands of users? And they're like, oh, Snapchat, like people on Snapchat just send little cards back and forth to each other all the time. We're the number one mini. And it's like, what? And so I went and looked in the little mini store and sure enough, they were like one or two at the time. So I thought that was kind of interesting and it made me think, oh, I should do a deep dive into minis and see what else is actually working here.

• 16:20Sam Parr?

  That's fascinating. And that's, we've talked about this like idea of like, you need distribution first. And if you have that, you have everything. And like, that's why I like Chrome plugins. That's why I like WordPress plugins. I didn't even know about minis.

• 16:33Shaan Puri?

  Yeah. And you know, I don't know if you need it first. There is definitely like a case for that. Other people would say, no, you need a product people love. And other people say, no, you need a great team. And like, the way I think about it is this guy near I Al, who I think also listens to podcasts, he wrote this book called Hooked. And

• 16:48Sam Parr?

  Oh, he's a listener. That's cool. I've read that book.

• 16:51Shaan Puri?

  Yeah. And so he has awesome book. And so he, he had told me this once in my office, he goes, every business is like a three legged stool. You have growth, you have engagement, and you have monetization, G E M. And he's like, you know, when you start your startup, you have none. You just have like, you know, a stool with no legs. And then you need to get your first leg on there. It can be growth, or it can be engagement, like a sticky product that people love. He's like, a good startup will have two. And if you have two, you have a pretty good shot of figuring out the third. The problem is, there's a whole bunch of people here with one legged stools, trying to go raise money. And I thought that was so spot on. And so then when I looked at companies, I just thought to myself, oh, do they have all three legs figured out? Two of the three I'm okay with. One of the three, I'm gonna wait.

• 17:35Sam Parr?

  Dude, I dig it. And I completely agree with that. We have like, a ton of ideas here. I'm, I'm really excited. Can I tell you something really quick, though, that I learned?

• 17:44Shaan Puri?

  Yeah.

• 17:44Sam Parr?

  So, do you remember, is it called Pro Republic? What was that article that got released with rich people?

• 17:50Shaan Puri?

  I think Pro Republic was the name. It was like, the billionaire taxes. I didn't read it, by the way. So, I don't know much.

• 17:54Sam Parr?

  That's cool. You don't have to have read it. But, okay, so there's something going. I didn't read it either. But it's not important, because it's the general topic of this, of like, how rich people pay little taxes. And they do that by, basically, and like, I don't know how to bring this up, but that's something like a total douche. But when you make little money, like, you get access to loans that are like, 1.5% or 1.2%, or whatever it is. It's based off of like, a lot of times.

• 18:21Shaan Puri?

  Yeah. Rich people get the most free shit, whether it's products, or cheap capital, or cheap anything. Yeah.

• 18:26Sam Parr?

  Basically, like when you sign up for like a big bank, you get a line of credit, like I think it's 75% of your, of the amount of money you have in there at like a 1% rate, or it's like based off the London Bond Exchange. And I was curious about this, but basically, a lot of folks like Elon and just most people who are wealthy, or a lot of people who are wealthy, they take loans and that's what they use to live on. But in my head, I'm like, but you still gotta pay that back. So how are they doing that? And I went and talked to some bankers and do you know how this, like, do you know what the expectation is here? The expectation is that you actually live on those loans forever.

• 19:02Shaan Puri?

  Forever, yeah.

• 19:03Sam Parr?

  And your estate pays it when you die. Is that crazy? Is that a crazy thing to think about? I kept thinking like, but how does the bank get their money back? And it's like, oh, no, no, no. Like, we expect that it's gonna be an outstanding loan for like 50 years. And we're just gonna keep loaning and loaning and loaning. And then when they die, we're gonna take our cut.

• 19:20Shaan Puri?

  They're not trying to make their money off you, the wealthy person. They're trying to take all of your millions and millions of dollars and lend it out to other people who are gonna pay higher rates. So they're like, okay, we need to lend money. Where do we get the money? Let's get the money from rich people. How do we get the money from rich people? We offer them amazing terms. Okay, then how do we make money? Well, we're gonna take that money and we're gonna lend it to people who don't have as much. And we're gonna charge them more, right? Kinda sounds screwed up when you say it, but that's the business model here, I believe.

• 19:48Sam Parr?

  Yeah, it's just like something that I didn't understand. I feel like I'm just a dumb idiot.

• 19:52Shaan Puri?

  If I'm wrong, I might be wrong because I'm not a banker, nor am I a bank, nor have I thought about this stuff.

• 19:56Sam Parr?

  It's just weird. I just thought that was weird. And that was totally like, that was one of those things where it's like, hello, this is how the world works. So I was like, I didn't know that. I'm just a country.

• 20:05Shaan Puri?

  It's funny because like, you're like, oh, you're the CEO. How much do you make? Oh, wow. This CEO came out and said he's taking a $1 salary for the year. What a great guy. It's like, no, obviously, that just means he doesn't make his money off his salary. He makes it off something else. It's okay. He's getting his stock. Okay, great. Wow. He's getting all this stock. Stock's going up. You must pay a ton in taxes. No, no, he doesn't. Why is that? Well, he doesn't sell the stock, so he doesn't realize any gain. Okay, then how does he pay for like that jet? Oh, because he just like lent, he gets a big loan or line of credit off of his stock as collateral. And so, wait, so he lives for free off that loan? Yeah, yeah, he does. He just has to pay, you know, 1% or 2% or 3% interest. Oh, wow, that seems pretty good. Okay, even better.

• 20:50Shaan Puri?

  Let's say he takes that money and uses it to invest. Now that interest payment is also tax deductible. So it's like, just gets like, kind of crazy how the advantages sort of stack up against each other. He bought real estate? Great. Now he's going to take this huge depreciation, you know, on the real estate he bought. And then if he sells it for a gain, he's going to 1031 exchange it into another real estate property and pay no gains. It's pretty amazing.

• 21:12Sam Parr?

  I felt like, when I learned this, I felt like I was sitting, like I went to a fancy dinner table for the first time. They finally showed me like that small fork is meant for like taking crab meat out of the claw. I was like, oh, that's for, oh, well, goddamn.

• 21:30Shaan Puri?

  I thought that's the kids fork.

• 21:31Sam Parr?

  Yeah, I was like, I just thought that was the little people. I don't know what that is. Anyway, I, that was like, it just like hit me in the head. I'm like, duh.

• 21:38Shaan Puri?

  So that was the, so I had a call with a tax guy, a tax strategist. I'm paying for this like tax strategist because I'm like, okay, where do you figure this stuff out? My brother-in-law had found somebody through a thing and he saved him a bunch of money. And he was telling me about it. I was like, I gotta talk to this guy. So I talked to him, this guy Jeff. And he's like, okay, you know, so what are your, what are your goals here, you know? And I was like, I want to learn what the rich people do to pay less taxes. And then, you know, decide or try to do some of those things if they apply to me. And he's like, okay. And I was like, so walk me through here. Like, if I make this much money in a year, I'm just doing this. I'm just writing this huge tax bill, tax check, you know, every, every year. What do they do where they don't have to do that? And he was like, just kind of like amused at my line of questioning.

• 22:22Shaan Puri?

  But in the end, he was like, super helpful. He really like kind of outlined all the things. And then at the end, I was like, all right.

• 22:29Shaan Puri?

  How does attorney-client privilege work here? I was like, let's just say I tell you that, you know, this, this part of my house, that's my home office deduction. Sometimes I nap there and like, also I store my dog stuff there, right? Like this unrelated to my office. I said, how honest can I be with you? And he goes, you can be totally honest. I recommend you do. But there's no attorney-client privilege. I could be subpoenaed. And he goes, I'm not going to do anything wrong because I don't have to.

• 22:56Shaan Puri?

  Great.

• 22:57Sam Parr?

  Basically, you just need to ask for like red light, green light, yellow light.

• 23:00Shaan Puri?

  Like now he'll be like, he'll be like, yeah. So like, are you active or passive on that? I'm like, suppose I was active, what would the number be at the end? And then suppose I was passive and then I will give you my answer by the end of this. And he's like reading between the lines of like, oh, I understand. And we haven't even actually gotten into any of my stuff, but I wanted to ask all the questions upfront to him about like, like I, I, I'm more fascinated with how the tax thing works. I don't even have like a very complicated setup. There's not really anything I could do because I'm not like Elon. I don't have this like complicated structure and all these shares I could borrow against in that same structure. But I more am paying this guy to tell me what other rich people do. And I'm fine with that. I think that's a great trade.

• 23:41Sam Parr?

  Do you want to talk about, you want to go, I've got one idea. So, so I, I, well, I'll do yours. You want to do mine first? I mean, I can give you the summary and then we can get into it later.

• 23:51Shaan Puri?

  Yeah, do yours.

• 23:52Sam Parr?

  Okay. Do you know who Paul Singh is?

• 23:55Shaan Puri?

  I never met him, but I've heard about him and my buddy is his business partner.

• 23:58Sam Parr?

  Great. So Paul, Baby Bump?

• 24:01Shaan Puri?

  Bumpboxes.

• 24:02Sam Parr?

  Bumpbox. So, yeah, sorry. So you'll actually know more about this than I do. So I reached out to Paul because I don't even know how I contacted him, but Paul Singh is a guy who started this thing called 500 startups. They're not really around too much anymore.

• 24:14Shaan Puri?

  He didn't start it, right? Did he start it? Dave McClure started it.

• 24:17Sam Parr?

  I don't know. Yeah, maybe he didn't start it, but he was like there at the beginning. And so, uh, yeah, I, I, I don't know if he helped start, maybe is the right word. And he was just, he was a guy there. He helped make it popular. And somehow he started traveling in an RV. That was his shtick was like I, he actually left San Francisco before his school. He goes, I just want to travel in an RV. And years and years and years ago, he started a hosting company, like a web hosting company. And he wouldn't talk to me about it too much because it's kind of private. But he's like, basically I make millions of dollars a year from cash flow from that. And I invest a large amount into privately held companies, both brick and mortar and tech startups every single year. And I would travel just to meet new potential investments.

• 24:59Sam Parr?

  And at one point I met these folks who had this thing called Bumpbox. It wasn't very popular and so it sounds like you know the people from Bumpbox, right?

• 25:07Shaan Puri?

  Yeah, I know it super well.

• 25:08Sam Parr?

  Oh, well, then you probably know a lot more than I do, but let me tell you what I know. So he met these folks and he bought into it. He didn't start it and he didn't buy it outright, but I think he bought into it. So for like $200,000 or something like that, he bought a portion. I don't know how much it was, but basically the whole shtick was. We know statistically like where you should be in your pregnancy and like the the feelings that you're going to have and the products that you're going to need. And so we sell you a monthly box for $50.

• 25:35Shaan Puri?

  Well, let me simplify that part. I think it's more like when you get pregnant, especially for the first time, there's like all these new things happening inside your body, outside your body, you're trying to figure stuff out. And there's like a million things that you're supposed to buy and get to do, but you don't know what they are. And even if you know what they are, you don't know which product to buy because you want to buy the one that's like safe, but also effective, but also whatever. And so a lot of reading reviews, trying products. And so what BumBox did, which is pretty genius, was they just said, look, we're going to find the best products for every phase of your pregnancy, first trimester, second trimester, third, and then post. And we're going to package it up into a subscription box. So you're just it's just going to show up on your doorstep. You don't even have to think and worry about this stuff anymore.

• 26:15Sam Parr?

  And so Paul came in and he's like, yeah, they're doing you guys are this is okay. It's pretty good. I think we could think just a tad bit bigger and we could turbocharge this. And so now their vision is basically from conception to like 18, 19, 20 years old, a mother is handling lots of different stuff. And we want to be the place that she turns to for a variety of different like needs to care for her kids. And the company's pretty interesting. It's like $40 million in sales. He his goal is to grow the company 2X every single year. And of that 40 million in revenue, 60% is from subscription boxes and 30% is from this 30 to 40% is this other stuff. And Paul came into this business and he goes, these boxes are great, but let's just make more and more and more stuff for

• 26:58Sam Parr?

  this person. So let's figure out everything the mom needs and let's just make it. And so now 30, 40% of their business comes from medical equipment, which I don't even know what that means. Whatever. I don't know what they sell.

• 27:08Shaan Puri?

  So like, I don't know if they're selling this yet. We might have to take this out. I don't know if it's out yet, but like, for example, a breast pump. So when you when when you're breastfeeding, you're going to pump in between feeds or whatever. And insurance covers it. And so, you know, these things are expensive devices that you need, medical devices that the doctor sort of gives you that you'll use for the first year or so of your pregnancy, of your afterbirth.

• 27:32Sam Parr?

  And the other stuff they sell is they'll figure out what you want this and they're going to call you and one of their insurance agents are going to call you and say, here's the 50 best types of insurance companies that you should check out if you want to buy this breast pump or whatever. It's all covered by insurance and then they make a cut off that lead. So, kind of an interesting company that I wanted to talk about and I wanted to talk about it because A, there's a few things going on here. First, this is a guy who has made a lot of money, angel investing in tech companies. And he told me, I never want to raise money. I want to own as much of this business as I can and we could either distribute profits to ourselves and our employees, or we could sell for a fuckload of money. And B, I just think that it's kind of interesting. It's not like,

• 28:16Sam Parr?

  it's out of my world. You know, I don't have kids. I'm not a woman. It's just kind of interesting. What do you know about this?

• 28:21Shaan Puri?

  So, Leland, who's the founder and Leland's wife, I don't remember his wife's name off the top of my head, but they started this thing. They're amazing. He's been so helpful to me in e-commerce. He really knows his shit and just awesome guy. I think they're based in Illinois or something like that. And, you know, super, super nice in the Midwest, built this company out. It's kind of a great company and I think subscription is really hard to do, but when you do it, it's fantastic. And I think they've done a pretty good job of actually, actually pulling it off. And the way he says it, he's like, we're not a box company, we're a mom acquisition machine. And I'm like, that's absolutely right. And that's why they think bigger than just what, what's one product we could sell them. Okay, box might be the first. What's the second? What's the third? What's the fourth? Because

• 29:06Shaan Puri?

  we're just going to acquire moms at an insane, insanely good rate and be able to offer them products that they're going to need for, you know, the period of their, of their child, you know, childcare time.

• 29:17Sam Parr?

  And I said to Paul, I go, you know, like, this is great, but you are doing a lot of stuff that I think is a bad idea, but it's a great idea. I mean, clearly you're making it work, which is you are not just staying, you're not focusing exactly. You're, you're focusing on the mother category, but you're launching loads of different stuff. And he goes, yeah, that's actually our goal. And the reason we're doing that is our, our, our whole Unique strategies that we're going to move quickly. But he's like, when you think about it, a hundred years ago, at some board meeting, the guys at P and E or Callog or whoever it is, the big conglomerates nowadays, they go, you know, like, look, we could start building, you could start selling more soap, or we could just buy all the soap and then buy all the razors

• 29:59Sam Parr?

  and just buy everything that like you possibly use in your home and own the whole category as opposed to just focusing on this one thing. And even though tech focuses on this one thing, let's just do the opposite and say, you know, why can't we build a family of companies? And I thought that was pretty cool. It broke my frame. It's a little different than what I've heard or what I would have done. And I think it's neat to see something that's the opposite of what I like. Or what I would do.

• 30:23Shaan Puri?

  Caveat would be, I think they did focus on getting bump boxes core to work for a number of years. Right. This is not new.

• 30:28Sam Parr?

  Obviously, yeah.

• 30:29Shaan Puri?

  So you buy yourself the right to try a bunch of new things by getting your core to work really, really well and get to scale. So I think they did that part. They weren't doing, I don't think, five different things before. The other thing is like, this idea is so simple. And, but when you talk to Leland, you're like, oh, you're like a badass operator. Like he's in the nitty gritty. He's like, oh, yeah. And Facebook ads, I can put, I can copy paste this over here. And if I do that, it's like, it's just a little bit better. The platform doesn't even really support it, but I can do it manually this way. Or like, you know, they'll use a, you know, like they're, when they're marketing to people, they're like, yeah, we actually call, I don't know if you've ever heard of this. Have you heard of like ringless voicemail?

• 31:08Sam Parr?

  No.

• 31:09Shaan Puri?

  It's like this marketing tactic that he's like, oh yeah, we call our customers. I was like, don't people hate getting calls? He's like, oh, it's not a call. It goes straight to voicemail. I was like, what? He's like, yeah, there's a way to call somebody that goes straight to voicemail and you leave a message. So it's a great way to like, instead of staying in the email inbox and you're buried under 5,000 other emails, the person might get one or two voicemails a day and one of them can be from us. And people like hearing from us and they hear a voice of a human being talking to them. I'm like, he's just doing a thousand of those small operational wins. Every year. And I'm like, oh, that's why you win because this is a simple idea that I think nine out of 10 entrepreneurs who tried this same exact idea would have failed. Same idea, same.

• 31:47Sam Parr?

  So why didn't he sell a portion of it if it be the powerhouse? He just needs some help.

• 31:51Shaan Puri?

  Early on, I think they needed some capital and I think they met Paul, pretty impressed by him. And I think he's been a good kind of like partner for them. But, you know, if you, if you offered them a deal now, I don't think they would take it. Right. Because he, he's in a different position now than when it's just like, I mean, he started the company, him and his wife were like, I think they were like at a conference or something like that. And they were just like walking, it was like, you know, like the parking lot or the, the water, the hot dog stands, like, you know, far away because everything's inconvenient at an event. And while they were walking there, they basically like had this idea, they're like, screw it. Why don't we do this? Like, let's start a business. Why don't we just go for it? And they just like, kind of decided to do it. And so, you know, at that point, you're really green. You don't, you don't know anything. And then now he knows obviously a lot because he's been doing this for, I don't know, whatever, seven years or something.

• 32:33Sam Parr?

  Have you heard of, I'm making a quick pivot. Have you heard of this thing called the anti Galloway index?

• 32:41Shaan Puri?

  I, I don't know if it's a real thing. I know that a lot of people basically make fun of Scott Galloway for being absolutely wrong about all his investment advice and predictions.

• 32:52Sam Parr?

  So there's this guy.

• 32:53Shaan Puri?

  Did someone turn it into an actual investable asset?

• 32:55Sam Parr?

  It's crushing. No, no, no. So there's this guy named Scott Galloway. Scott Galloway, I've had lunch with him. He's been nothing but nice to me, but a lot of people dislike him because he makes some crazy statements. He's, um, they tease him for being real woke. He makes these predictions where he puts like the, my, the winners and losers of each year, and he makes these really bold predictions. And a lot of people attack and a lot of people in general make fun of him because his predictions, I mean, I'm sure some of them are right, but like a lot of them are wrong, like really wrong.

• 33:25Shaan Puri?

  Massive wrong, yeah.

• 33:26Sam Parr?

  Like one time he said that Macy's is going to crush Amazon. And that's just an example. And some shithead who I love made a thing called the anti Galloway index. And if you, so basically, if you would have done the opposite of everything he said since 2019, uh, tech companies that Professor Galloway has predicted would fail have outperformed the S and P 500 by a whopping 61%.

• 33:51Shaan Puri?

  No, no, no. They outperformed as you've heard and have the return itself is 61%.

• 33:57Sam Parr?

  Sorry.

• 33:58Shaan Puri?

  You know, during the time and you know, even if you it says, even if you exclude Tesla, which was one of his big bets that he said was fail and it took off and said, even without that one, still 23% return.

• 34:08Sam Parr?

  That's crazy, isn't it?

• 34:10Shaan Puri?

  This is hilarious. Who made this? Let's give him a shout.

• 34:12Sam Parr?

  I don't know. I have no idea.

• 34:13Shaan Puri?

  Okay, that's hilarious. This is cool. Yeah, let's. So, okay, here's an idea, by the way, which is, is there, I think there is, there's some new products that are coming out that let anybody create a basket of stocks. That's like, like, for example, I think there's a company called Doji that's doing this, D O J I. And what they do is you can go create, I can go create the Shawn index and it's five stocks that I'm investing in and you can actually put your money into my index and buy it, buy those stocks and then it'll show over time how my index has performed. And I can make the tech index and I can make my like, high risk, high reward index or whatever. That's my understanding. I haven't

• 34:56Shaan Puri?

  used the product, but my understanding is it's kind of like that, which I think is an awesome idea, by the way. What do you think of that idea?

• 35:01Sam Parr?

  Yeah, I mean, why can't you do that on, I've mentioned them before, I think it's called like Bull, Bull something. There's that one, there's a one Israeli Robin Hood competitor and they've done this. It's called Copy Trader and you create Weebull. Is that what it is? Weebull. And you could do this on that platform. I think it's sick. I think it's awesome.

• 35:22Shaan Puri?

  Yeah, it seems really cool. I don't know if I get some incentive by like sharing my basket, but that would be like a really cool model where essentially I get a small cut of the assets that are invested into it if we perform or something like that. And, and then you could see like who's right, who's wrong, and not just people who cherry pick, oh, I invested in this one thing and it's done great, but they don't tell you about the five losers they had. Here, it's like all on the record what you, what you picked. And then, you know, you can see like the Gallo index.

• 35:47Sam Parr?

  I think it's amazing. So you want to talk about some of your ideas?

• 35:51Shaan Puri?

  Yeah, sure. Which one do you want to do? So have you heard about this Phantom Secure thing? I thought this was pretty sweet.

• 35:57Sam Parr?

  No.

• 35:57Shaan Puri?

  So, okay, so there was this story the other day about the FBI had this huge crackdown on criminals. And I was like, okay, that's interesting. Tell me about it. And so I was reading it and in there they were talking about this. The story. Okay, so there was this app called Phantom Secure. And what Phantom Secure was, it was marketed basically as a, as an app that you can use if you don't want, you know, anybody to see what you're writing here, right? So obviously criminals are like, hey, that's interesting. I'd rather write there than on Gmail, right? Where my stuff is stored on a server somewhere and I can get, you know, those, those records can we get subpoenaed or whatever? And so Phantom Secure at its peak had 20,000 users.

• 36:42Shaan Puri?

  It would made $80 million off those 20,000 users. So just for like math, uh, cause you would pay to use it, right? Cause for you, you're like, this is a business tool for me. If I'm a criminal, uh, I need secure messaging. I'll pay for this. And so they were making $4,000 per user. And just for like comparison, WhatsApp makes like $2 per user. So, you know, $4,000 per user was, it's like an enterprise product for criminals.

• 37:04Sam Parr?

  But why were they paying for that versus like the other things like Telegram or whatever it is?

• 37:09Shaan Puri?

  Because this was even more secure. What you were, you were getting here is you're not just getting an app. You're getting a phone that has been wiped. All the, uh, all the other apps are gone. There's only a secure messaging app on the phone. That secure messaging app will self-destruct under certain conditions. If you're like, you know, arrested or you trigger it or whatever. Somebody misses up, mess up password three times. So it's a like, it's a burner device designed for criminal communications. CTO gets arrested. The only way you could even get into the app was through referral, right? So, so this thing existed, they arrested the guy and criminals were like, oh shit, we don't have this app anymore. So the FBI, these, I don't know, the story is like these two detectives were out to lunch one day and they're like,

• 37:52Shaan Puri?

  why don't we create another Phantom Secure? But we own the thing, we own the back channel. So they created this app called anon, like anonymous. And they put it on 12,000 phones. It, and they let it be out there for 18 months for criminals to use and start to trust and refer other criminals onto it. And the whole time, every message is going to the FBI's secure servers. But they just waited. They just let the thing spread like a virus all throughout the criminal organizations. And then they just took everybody down. And I was like, that is a badass story.

• 38:24Sam Parr?

  How did you find that?

• 38:25Shaan Puri?

  Props. I don't know. I saw this story and I just clicked it. It's amazing.

• 38:29Sam Parr?

  So do you think, okay, so I think that, I actually think this is an amazing idea, by the way. It sucks that people were using it that way, but I, I think it's an amazing idea. Kind of like Silk Road is like an amazing idea where it's like, yeah, like it's cool to create like a marketplace where you can sell anything, but it's kind of shitty. Like I don't want to support anything where like,

• 38:47Shaan Puri?

  Right. Who are the people that want a marketplace that'll sell them anything? Even different stuff than I can sell on eBay. Oh, maybe, you know, drug dealers and like assassins, weapons dealers.

• 38:58Sam Parr?

  I'm not like in favor of actually everything, you know, I'm not actually a true libertarian because I do think that like some stuff should be illegal. Right?

• 39:04Shaan Puri?

  Right.

• 39:05Sam Parr?

  But I am incredibly bullish on things like, what's it called? So there's DuckDuckGo. Do you see DuckDuckGo? They just took, took a bunch of funding.

• 39:15Shaan Puri?

  I didn't see that. No.

• 39:16Sam Parr?

  Yeah. They sold a hundred million dollars worth of, um, of secondary shares and they're doing over a hundred million in revenue.

• 39:22Shaan Puri?

  Right.

• 39:22Sam Parr?

  And then also, do you know Proton? Is it called Proton Mail?

• 39:25Shaan Puri?

  Right.

• 39:26Sam Parr?

  Why are you laughing? I mean, I say it funny?

• 39:28Shaan Puri?

  No, no, no. I've like, I haven't heard. So the funny thing is all these ideas I remember hearing about like DuckDuckGo. Six years ago, I remember reading about it, being like, oh, that's kind of weird. Like,

• 39:37Sam Parr?

  I thought it was like huge.

• 39:38Shaan Puri?

  Does anyone care? Like, do people really care? Oh, no, it doesn't seem like they care. Move on. Proton Mail, Signal, all these apps. And then they were right. Their core insight, which is that people are going to care about privacy. People are going to care about not being tracked by big tech companies, not being advertised to. And they're going to care about not having their, all their messages stored forever in a way that could get leaked or hacked. And, uh, you know, you get canceled or you get your business secrets, you know, outed like Sony did, right? And so all those ended up being true. And at the time, for years, they looked like non-winners. The people weren't really using them at the time.

• 40:15Sam Parr?

  I totally agree. I thought it was stupid. I'm like, DuckDuckGo, what are you talking about? Now I, uh, it's my, it's my, it's what I use.

• 40:22Shaan Puri?

  You use DuckDuckGo as your default?

• 40:24Sam Parr?

  I use it often and I'm starting to use that as default. Yeah.

• 40:27Shaan Puri?

  And do you use Brave? Because Brave is the new one I think fits into this category.

• 40:32Sam Parr?

  No, I haven't yet because switching from Chrome is shockingly challenging.

• 40:37Shaan Puri?

  Right. But switching from anything, switching from mail, messaging, they're all, they're all a bit challenging.

• 40:42Sam Parr?

  Google's a bit easier.

• 40:43Shaan Puri?

  Is it? Why? Like?

• 40:45Sam Parr?

  Switching my search thing?

• 40:47Shaan Puri?

  Yeah.

• 40:48Sam Parr?

  Uh, I mean, I could probably get good results on Bing or Google. I mean, I, I, I'm just really trying to go to the Wikipedia or Quora or Facebook or Twitter.

• 40:56Shaan Puri?

  Right. I'm pretty sure that private browsing, basically, you know, like a Brave, Brave or a Brave like company, five years from now, we're going to look at it and it's going to be just like DuckDuckGo or Signal in that like it just takes over slowly but surely.

• 41:11Sam Parr?

  I agree. And I think that 10 years from now, we're going to say like, I can't believe you used to use X, Y, and Z and you would just do that. Like, that's shocking to me.

• 41:19Shaan Puri?

  You used to just give up your location to, to anybody to be advertised to, right? You used to, like Alexa, right? You used to just have like a hot mic on in your house all the time, right? So those are going to seem like strange, strange situations that we were okay with.

• 41:34Sam Parr?

  That's the inflection. So the other day, if you didn't listen, we had this guy named Mike Maples on and he was kind of a genius and he was, he talked about inflections and he's like, what I, I invest in early stage stuff and it's pretty impossible to predict what's going to be big. So I try to use some frameworks and I just basically think like, you know, what interesting things, what interesting inflections are going to happen in 10 years? It's going to make X, Y, and Z possible, but it's not possible right now and I'm going to try and get into it. So like, for example, Uber, what made it possible was everyone started having really great phones that had GPSs in it. Without those GPSs, it would have been very challenging to do this.

• 42:07Shaan Puri?

  Right.

• 42:07Sam Parr?

  And one of those inflections that I believe to be true, and I'm trying to put my money where my mouth is and invest stuff like it, is this privacy thing. I believe that that, I believe that to be true. I believe that's going to be a big thing coming up. I don't know who's going to win or what the, what the end result will look like, but I believe in the negative trend.

• 42:24Shaan Puri?

  Right, right. You know what to look for and you know what's going to look strange now, right? We talked about Guardian, that app on your phone that like, it's like a auto VPN for, for your mobile apps. Brave Browser, I think, fits into that. You know, when Mike Maples was on, he said something really fast that I thought was actually super insightful that we didn't really go into. He goes, he goes, every like kind of era of tech. The old valuable thing becomes like completely commoditized and there becomes a new valuable thing. So what does that mean? So he goes, you know, back when it was like, at first you were selling PCs and all the money to be made was in the hardware. And then you had like Microsoft and others basically come up and they're like, cool. IBM, you be the hardware, we're going to be the software.

• 43:06Shaan Puri?

  And then like all the money shifted from being made into hardware to the hardware became completely commoditized. And all the money was made in software applications. And then it was like, oh, software applications are, you know, like where all the money is made. And then people started making services like Google and Facebook. It's like, wait, it's a free software application. So then how do you make money? It's like, because data is the valuable thing. You don't realize that, right? Microsoft doesn't realize that they're going to charge you for the software. We're going to give away free software, but we're going to make all the money on the data. And it's like, okay, great. And the shift that's happening now is that data is the thing that makes money. Well, we're going to make our data open, open source. We're going to make our blockchain open. Anybody can build on top of it and we're going to go open data. So then where's all the money to be made? And then you have like, kind of like a new answer that comes after that.

• 43:52Shaan Puri?

  And so I thought that was like such a spot on observation. And it's like, that's how you observe, that's how the next, you know, $100 billion, $500 billion company looks nothing like the last one. If you're just looking to match, what's the next Microsoft? You're never going to think it's Facebook, this college social network that's free. Right? You're never going to think it's Google, the search engine that's free. You're going to think it's supposed to look more like, more like Microsoft, this like enterprise paid software thing. But no, it keeps switching because they, they react to it in that way. And so, uh, like, that's why, you know, I got kind of made fun of when I was talking about BitClout. But BitClout, I think is an example of this where they took the most valuable part of Facebook and Twitter, which is the, the social graph and the data that's, that's underneath it.

• 44:36Shaan Puri?

  And they were like, nope, that's going to be freely available. Anybody can take our data. You can make a better version of BitClaw. You can like, you can make a new skin, make a new client. You can make a fork off this. The data is all open, open chain, which Facebook would never give you access to their database. That shows you every person, their photos and their friends. You can never get access like that. It's their most prized possession. And BitClaw basically says, that's now free. Instead, we're going to make our money on these creator coins, right? It's a different method.

• 45:03Sam Parr?

  I think that you've said a lot of amazing stuff for the past two years. I think this little rant right here might be the most like not valuable in the sense of like, whenever you talk about like fluffy bullshit, that's useful of like, I need to have confidence. Yeah, like that is useful. I call it fluffy, but it's incredibly useful. I think what you just said right there actually might be one of the most valuable rants in terms of just money that you've ever said. I think that, um, I think that I do not have the ability to build pretty much any of the things that you're discussing. I don't, you might have the ability, but I certainly don't. I don't think you do either. But I think that if you are listening to this and you think you have the ability to do some of this, some of this stuff, I think like that you, we've very clearly just said

• 45:46Sam Parr?

  a thesis of what like the world's going to be like in 10 years. And I would bet my own personal money that that actually is going to be true. And I think it's going to be, um, not just true a little, but like true a significant amount.

• 45:59Shaan Puri?

  Right. And there's not just one trend happening at once, right? Like I remember talking to Alex Tu, the founder of Calm, and he just believed that like mindfulness and being, and you know, calm and meditation was going to become a bigger thing. And there was multiple years where it was not getting, it was not growing very fast because it wasn't a thing. And then sure enough, people started to feel really fatigued with technology. They started to feel really busy and constantly on and the mobile phone was too much. And then, wow, there's this app that like is actually designed not for me to constantly use it and check it, keep checking the notifications over and over and over again. This app is to calm me down and mindfulness and mental health became a thing. And it's like, yeah, mental health became a thing and he was prepared. He was ready with a solution for that, that he had been baking for years.

• 46:44Sam Parr?

  Yeah, so I think it's bullish or bullish. I think it's amazing. I think it's gonna be a thing. You want to do a couple more? You want to do this Chick-fil-A thing?

• 46:50Shaan Puri?

  So I read this, I read this blog post or this article that the Chick-fil-A tech team put out. And if I'm not the biggest Chick-fil-A customer, I'm top five easily in the country. So, you know, so anything Chick-fil-A, I'm gonna read. And what they were talking about was like Chick-fil-A using AI machine learning, blah, blah, blah. And I was like, oh, let me see what this is. Some bullshit. And I started reading it. It was actually pretty interesting. First of all, 90% of it was just over my head. But I thought it was pretty fascinating. What they were saying, well, first two things. They kind of like, they put their stake in the ground, which I appreciate. They go, Chick-fil-A is, you know, a restaurant that's sort of different than others. We're only open six days a week, but we do more sales than people that are open seven days a week.

• 47:32Sam Parr?

  Baller thing to say.

• 47:33Shaan Puri?

  I was like baller, like strive to be Chick-fil-A, you know, like I want to be the Chick-fil-A. I want to work less and make more than somebody who's working more. And the other, you know, the other thing I thought about was like, a lot of people hate Chick-fil-A because they're like, overly Christian and like have like, like anti-gay marriage and stuff like that. And I'm like, oh, that sucks, but like this chicken is so good. I'm gonna eat here. You know, like the chicken wins in the end.

• 47:55Sam Parr?

  What I would always say, it's like, I can like R. Kelly's voice, but not like him. Like I can admit that I believe I can fly is like a banger and also say he's a horrible human being.

• 48:06Shaan Puri?

  Also, you're not invited to my daughter's birthday party.

• 48:09Sam Parr?

  Yeah, like I could do both. It is possible to do both.

• 48:12Shaan Puri?

  And so with Chick-fil-A, it's like, I want to stuff my mouth with chicken and then be like, you guys, you guys are wrong. You know, like that's how I want to be. So anyways, I'm, I'm like, you want to be like Chick-fil-A, a product so good that you can actually be batshit crazy or even offensive and still the person who disagrees with you, they need your product. It's that good. It's must have. So then they were talking about their tech and they were like, well, our stores, when we designed them, we thought they were only going to handle like, let's say, just for simplicity sake, 100 orders, 100 customers a day or whatever. But the actual usage, the demand is so high for Chick-fil-A that we get three times more output than the store was designed for. And he's like, so how do we do that? Like, once you design the store, it's kind of, it's already built. You can't really go back

• 48:55Shaan Puri?

  and change it. So we've had to use technology to get 3X the output that the thing was designed to do. He goes, so the first thing we tried to do was, can we like predict demand better? Right? So if you want to pump orders out faster, instead of waiting till after the order happens, I should, I should just say, hey, there's always a lunch rush at noon. So I'm going to throw a bunch of fries in and I'm just going to know that I get this much demand. He goes, but the problem is there's too many variables, you know, a soccer game ends nearby, you get a rush of customers, the weather changes and that causes a dip in customers. You know, there's too much traffic on the highway, that's caused a dip. So it's too unpredictable. You can't just say Fridays at noon are always going to have this much demand. Too many external variables. But he goes, so what we did do instead was,

• 49:41Shaan Puri?

  we put like hundreds of sensors inside of a store. So that in real time, I'm basically taking the, you know, like the order as the person's typing it into the, to the machine. And that's, that's being matched with a sensor that tells us how active the fry machine is. And then it gives a signal to the worker to basically like, hey dude, put more fries in, there's going to be more demand or whatever. Right? Like they're taking all these signals and how many people in the drive through, times this, times that, and basically making predictions of what do they need to make so that they can get that extra 20% of orders done per hour for throughput. And so I thought this was kind of interesting and I don't even fully understand the model. And I'm kind of like, I'm kind of like, what's like,

• 50:23Shaan Puri?

  it's not like mansplaining, I'm like dumb splaining. Like, the thing I just said is not actually what they do, but it's the essence of what they do, which is they take, they have 100, 100 like sort of smart devices in the store.

• 50:34Sam Parr?

  This whole podcast is, is we just said like, they just, they just, it just, it just bump boxes. All they do is they just sell shit that like, I mean, need, that's all. They're not like expert at Facebook ads or experts at like deal making for like supply change. So I mean, they just do that.

• 50:52Shaan Puri?

  So the point is, there's like a hundred smart devices in a Chick-fil-A that are feeding into a machine learning algorithm to put something out there so that a frontline worker who makes, I don't know, $16 an hour is able to be more effective and they're able to get more source, more sales per square foot. And so I started thinking, like, first of all, I had no idea that like, kind of old school companies like Chick-fil-A are that deep into like adding technology into their stores and their services. And it made me think two of two ideas. The first is, those people should spin, the engineers working on that should spin out of Chick-fil-A, and then go offer this as a service to every other restaurant. It's basically like, hey,

• 51:33Shaan Puri?

  Chick-fil-A spent $50 million over the last five years developing the technology to make their store smarter. So we generalized it, and it's a product for you, right? That's my old export framework. They should export this idea from Chick-fil-A and make it available to any, any restaurant chain. So that's like the first idea. The second idea is, what are the companies that are like McKinsey or like a consulting company? Because I assume Chick-fil-A, when they go out in the job market, they're trying to hire machine learning and AI engineers. I bet they're finding it pretty hard to compete with like Google and Facebook and OpenAI and all these other companies. Like, what great engineer is going to work for Chick-fil-A, right?

• 52:11Sam Parr?

  I think you'd be surprised. You know who crushed it with tech stuff, or relatively speaking, was Walmart. Walmart had this amazing thing called the Walmart Innovation Lab in Silicon Valley.

• 52:24Shaan Puri?

  Yep.

• 52:25Sam Parr?

  It was pretty sick. And I went to, I was reading the other day about the most beloved brands amongst young people, and it's like,

• 52:33Shaan Puri?

  Target.

• 52:34Sam Parr?

  It's like Vans.

• 52:35Shaan Puri?

  Starbucks.

• 52:37Sam Parr?

  One other one, and like the number one most loved brand is Chick-fil-A.

• 52:42Shaan Puri?

  Right. So fair enough. Maybe some people, maybe some Stanford graduate. Is going to work for Chick-fil-A and they're cutting against the grain, but I think most people are going to go towards more traditional brands, which really told me the way most companies are going to solve this is not by having as much in-house tech talent as consultants that basically take good tech talent, but like hypercharge them to get them to go faster. And so I'm curious, I bet this exists, but I'm curious who's building like a McKinsey type of company, like a badass consulting company that is only tech consulting. It's hardcore engineer, it's engineering specifically around like the new age stuff of machine learning and AI. And I think that you could build a new

• 53:24Shaan Puri?

  McKinsey, Deloitte, PWC, that is basically when your company needs tech, when your company needs tech answers, you basically hire this high-priced consulting firm that comes in and these guys are not suits that are great talkers, these are, and make great pitch decks. These are engineers who come in and they actually build and they teach your team how to build and they build themselves. Wouldn't any mentor or all these guys offer that, you think? They do offer it, but I think their brand is not branded as this. And so I think there's an opportunity to come in and say, we dress differently, we talk differently, we don't even do, we don't have these 10 other offerings that McKinsey has. We are actually the best. If you really want to hire the best when it comes to engineering,

• 54:08Shaan Puri?

  you know, all of our guys are straight out of Facebook, Google, Stanford, Harvard. That's our crew and these, everybody's got a computer science degree. You know, this is our CEO. Look, he's a nerd. He's got Cheeto dust on his shirt. Like, that's who you're dealing with here. Whereas today, I know that McKinsey and others are like offering, offering these as part of their services and in addition to like tax planning and like 10 other things that they're going to do, you know, like financial audits and like other shit. So I think there's an opportunity to create like a big four type of consulting company if you just went all in on engineers.

• 54:41Sam Parr?

  I'm on, I'm on board. I think it's cool. I think that any engineer who's smart though would never want to start this business because that would be hard as fuck. But I do think that there's so many cool things that started as agencies that eventually they create their own software and it becomes badass. So for example, I do think it would be cool to do this for five, 10 years and then eventually just make the software and you could become, it would be a really easy way, or not easy, straightforward way to have a bootstrap software company.

• 55:08Shaan Puri?

  So have you ever heard of Consensus?

• 55:10Sam Parr?

  No, what is it?

• 55:11Shaan Puri?

  So Consensus is a, it's, it's a version of this.

• 55:17Shaan Puri?

  It's in the crypto space. So it was started by this guy, Joe Lubin, who was like one of the first kind of like six guys backing Ethereum. So he was like, Ethereum pre-launch, I think he was one of the main funding sources essentially. He came from the finance world and he believed in Ethereum. And so he, he's known as one of the co-founders of Ethereum. Guy basically became a billionaire off of Ethereum, takes the billion, he takes that, he basically spins off Ethereum launches. And instead of sticking with the Ethereum foundation, he creates Consensus. Consensus is like, we have an office in New York, LA, Shanghai, whatever, right? Like Tokyo, whatever. They like kind of a traditional consulting model and, but they weren't just doing consulting, but what they do is they, they had like in-house projects.

• 55:59Shaan Puri?

  So for example, Metamask, which is like the most popular Ethereum wallet, I think that's built into a browser. Was like either incubated there or they like, kind of like found the guy who built it and brought him into Consensus and that was one of their projects.

• 56:13Shaan Puri?

  But they basically, they make like, they'll go to like Mastercard or Visa and be like, you guys keep hearing about blockchain, right? Don't you need like just a group of blockchain like specialists who can come and teach your company how, how you should be using blockchains? And we'll consult with you, that will build projects for you and like will be kind of this like hybrid, like agency incubator consulting company type of thing. And they do like, I think they said they forecasted like 60 million of revenue in 2021. Now I should say, I personally think Consensus is kind of a shitty company. They hired like a thousand people. I don't think they had like the business fundamentals to support any of that. You know, so, so I don't think Consensus itself is going to be that successful, but that's an example of somebody who said, cool.

• 56:57Shaan Puri?

  All of the Fortune 500 is curious and interested in this new age technology. We can brand ourselves as. The like de facto group of if you're a big Fortune 500, come talk to us about blockchain.

• 57:10Sam Parr?

  Dude, I'm looking up this consensus company is fucking nuts. Started just recently, right? Oh, no. 2014.

• 57:17Shaan Puri?

  Yeah, it started right after Ethereum.

• 57:19Sam Parr?

  They do. Did this guy Joseph Lubin's help create Ethereum?

• 57:24Shaan Puri?

  Yeah, like I said, he, he was basically one of the big kind of like financial backers early on and kind of helped. When they were pre-launch, he was involved when there was like this group of seven or eight people that were helping build it. And they each had a different role.

• 57:36Sam Parr?

  The amount of wealth that this shit is creating in such a short time is crazy. Like, do you know that one guy? Okay, so what was that Disney movie called like the Secret Service kid or the first kid? You remember first kid?

• 57:50Shaan Puri?

  Okay, yeah. I don't know where you're going with this.

• 57:52Sam Parr?

  Okay, you, you remember that movie? Remember the kid actor?

• 57:55Shaan Puri?

  Uh, I don't remember him like.

• 57:58Sam Parr?

  He was also in the, in the movie Mighty Ducks.

• 58:02Shaan Puri?

  Oh, which one was he in Mighty Ducks?

• 58:04Sam Parr?

  Um, I don't actually know what he was in Mighty, what the name was, but his name's Brock Pierce.

• 58:09Shaan Puri?

  Okay.

• 58:11Sam Parr?

  Do you know who Brock Pierce is?

• 58:12Shaan Puri?

  He's also in Sinbad?

• 58:14Sam Parr?

  Yeah, well, no, Sinbad was the, uh, the, the lead secret service.

• 58:17Shaan Puri?

  He's the security guard first kid. Okay. Oh, I remember this movie. I love this movie.

• 58:20Sam Parr?

  Yeah, it's great, right? Okay, this guy's name is Brock Pierce. He's a Bitcoin billionaire now.

• 58:26Shaan Puri?

  What?

• 58:27Sam Parr?

  Yeah, dude, Google Brock Pierce. So he was a kid.

• 58:30Shaan Puri?

  Oh, by the way, in Mighty Ducks, he plays young Gordon Bombay. So he's not one of the, the kids. He's, he's the flashback of Gordon Bombay as a kid.

• 58:39Sam Parr?

  Yeah, but he was like a, a well-known actor. Like he was in, um, first kid was a thing. He was in Little Big League. He just did all like the nineties, like kid movies.

• 58:48Shaan Puri?

  Kid movies, yeah, every movie.

• 58:49Sam Parr?

  Everyone, if you, if you are born in, um, in the eighties, you recognize who this kid is.

• 58:55Shaan Puri?

  If you're 31 like me and Sam, then you.

• 58:58Sam Parr?

  You recognize who this guy is. Dude, Google him. He's a bit, he, he was worth like a billion dollars.

• 59:03Shaan Puri?

  That's hilarious.

• 59:03Sam Parr?

  You'll recognize him. He's got, he's a Bitcoin crypto guy. He wears that stupid hat.

• 59:09Shaan Puri?

  It's a stupid hat now. That's just great.

• 59:11Sam Parr?

  Google, go to images, go get Brock Pierce.

• 59:13Shaan Puri?

  Oh, okay. Yeah, I see them.

• 59:15Sam Parr?

  Is that? Yeah, he's that stupid hat leather vest guy. Like, it was a Puerto Rico. Dude, that guy is a billionaire now because he was in on crypto in like 12, 13, 14.

• 59:26Shaan Puri?

  He's like, he's like, hey, I need to, I need all those royalties from the first kid. We're putting it into ETH. We're putting it into ETH crowd sell. Let's do this.

• 59:34Sam Parr?

  It's just the amount of wealth that this is has created and so quickly. It's just crazy. It's just, it's fun. It's such a fun story, but Brock Pierce, the fucking first kid, Gordon Bombay, when he was a kid, whatever the guy's name was. He's a Bitcoin billionaire.

• 59:50Shaan Puri?

  He's the Billy of the week. That's it.

• 59:53Sam Parr?

  Is that nutty?

• 59:54Shaan Puri?

  Two of my favorite things, two of my favorite things in my life were Mighty Ducks and Bitcoin. And this guy's involved with both of them.

• 1:00:00Sam Parr?

  Now, I don't know, but I read his Wikipedia the other day. He's got like some shady shit going on where, I mean, obviously if you kind of look at him, he kind of screams shady. But he like, his partner was like raping kids. I mean, it was pretty fucked up. And like, if your partner's doing that, I'm not saying you're guilty, but I'm saying like, you probably like are involved, like I just. Yeah, like where there's smoke, there's fire type of thing. It's kind of fucking weird to me. And so there's like, this guy's got a lot of, this guy's gonna be like the modern day McAfee, you know, like.

• 1:00:31Shaan Puri?

  Yeah.

• 1:00:32Sam Parr?

  McAfee, he like became a billionaire and then also like, like did some crazy shit in Botswana or where the fuck you went. That's what this guy's gonna do. But anyway, Brock Pierce, crazy, right?

• 1:00:45Shaan Puri?

  That's crazy. Okay. By the way, I also have this little calculator in Excel that I should publish, which is, will the Winklevoss get the, Winklevoss twins get the last laugh? Which is, what does the price of Bitcoin need to be for them to end up wealthier than Mark Zuckerberg for taking, taking their idea and making Facebook? And, and then I thought about it and I was like, I wonder if Zuck just owns some Bitcoin as a hedge to be like, you'll never, you'll never pass me. But I don't think he's got that petty streak.

• 1:01:14Sam Parr?

  I'm thinking about selling my Facebook stock because I think like I've totally done a 180. I think Facebook's whack as fuck now, but.

• 1:01:22Shaan Puri?

  Why?

• 1:01:23Sam Parr?

  It's just lame. Like, who uses that now? I mean, Twitter's just kicking. It's just whack. And Instagram, I think, is even stupid now.

• 1:01:29Shaan Puri?

  I love how you're like, who uses that? Like, a billion people could raise their hand and be like, me, every day, multiple times a day.

• 1:01:35Sam Parr?

  I just think that it's just lame. I think TikTok is so much better and more positive. I like it more. But I think that Zuck is someone I would never bet. Like, I just think that he's just the greatest in terms of...

• 1:01:49Shaan Puri?

  Did you see the video of him spear hunting recently?

• 1:01:52Sam Parr?

  No. What is he doing?

• 1:01:53Shaan Puri?

  Oh, dude, you gotta Google this. Google Mark Zuckerberg spear, and there's this video. So he went hunting or whatever. He went on a hunting trip. I think that might be separate. Then he's like at this little, like, kind of like a throwing range, and there's like a giant target, and then you see Mark Zuckerberg in slow-mo, running up at it with a spear, and then launching the spear and getting a bullseye in the target. And it's just like, it's everything you would expect out of a Zuckerberg video, which is like, you know, two parts awkward robotic, one part like sort of fearsome and weird at the same time.

• 1:02:27Sam Parr?

  Yeah, I'm looking at it now. I mean, this is just... Yeah, wow. He got it.

• 1:02:32Shaan Puri?

  By the way, you said TikTok. You should follow this TikTok account. It's amazing. It's called Vitalik Doing Things. So Vitalik, who's the co-founder of Ethereum, he's also like Zuck, like hilariously awkward. I really love the guy. I think he's like... When he talks, yeah, he might have like kind of an awkward way of talking, but I love his thoughts. I love his brain, basically. And he seems like a very genuine guy. He doesn't just like shill Ethereum and like crypto and say it's the best thing ever and all that. Like, he's just like way more reasonable and clearly like mission-driven.

• 1:03:04Sam Parr?

  I'm looking at it now.

• 1:03:05Shaan Puri?

  His story is kind of amazing, by the way, like...

• 1:03:07Sam Parr?

  Was he like an adopted Russian kid or something?

• 1:03:10Shaan Puri?

  Do you know how this guy like got started in crypto?

• 1:03:13Sam Parr?

  No.

• 1:03:14Shaan Puri?

  So he's 18 years old. He like discovers crypto. He starts by just, he agrees to write free articles, or write articles for Bitcoin Magazine, back when Bitcoin was like super underground at the time. And Bitcoin Magazine paid him $3.50 per article, and he's like writing all about Bitcoin and like all the cool things you're gonna be able to do with cryptocurrencies. He's just like a kid, and he used to like go to different crypto projects and meet them and be like, hey, I'd love to like, help or like intern or like kind of like... Write about you guys and he started just getting known as kind of like this little blogger boy. And then like little blogger boy goes on to like, he helped write the white paper for one idea called colored coins that was like gonna be for this other project. And then eventually decides like, you know what, like, I have all these ideas about how I think crypto could change the world. Like, I'm just gonna make it myself. I'm gonna

• 1:03:59Shaan Puri?

  make Ethereum. And so he invents Ethereum at like age 18 or 19 and like is the youngest crypto billionaire in the world since.

• 1:04:07Sam Parr?

  Where's the name come from?

• 1:04:09Shaan Puri?

  Russia.

• 1:04:11Sam Parr?

  What's that mean?

• 1:04:13Shaan Puri?

  Oh, Ethereum. Oh, I don't know why he named Ethereum. Ether is like, kind of like, it's sort of like, I don't know if you know what ether is, it's sort of like this, it's like out of the ether. It's like this, like, it's like the substance of the war. It's basically like, I don't know how you describe ether really. It's like a, it's like matter. It's like, it's like a word like matter in the universe. And so I don't know why he called it ether. I think it was like, I don't know. I don't know the backstory. I shouldn't really speculate.

• 1:04:40Sam Parr?

  Well, you should have figured that out. I thought you were like betting your life savings on this.

• 1:04:44Shaan Puri?

  I saw, I took one look at this guy and I was like, I'm gonna hitch my wagon to this nerd. This, this guy's taking me to the top.

• 1:04:51Sam Parr?

  I think that's a good, I think that's a good bet, to be honest.

• 1:04:53Shaan Puri?

  But the TikTok channel Vitalik doing things is amazing comedy, because he's just a very unintentionally comedic guy.

• 1:05:01Sam Parr?

  Dan posted it. So he goes, I immediately realized that I liked it better than all the other alternatives that I'd seen. I suppose it was fact that it sounded nice and it had the word ether referring to the hypothetical invisible medium that permeates the universe and allows light to travel.

• 1:05:13Shaan Puri?

  Right?

• 1:05:14Sam Parr?

  Yeah.

• 1:05:15Shaan Puri?

  That's a guy you want to bet on.

• 1:05:18Sam Parr?

  All right. I think that's the show, right?

• 1:05:19Shaan Puri?

  Yeah, that's it.