When everything works, you learn the wrong lessons

Get our Resource Vault - a curated collection of pro-level business resources: https://clickhubspot.com/ebh Episode 785: Shaan Puri ( ⁠https://x.com/ShaanVP⁠ ) talks to Nick Huber ( https://x.com/sweatystartup ) about the biggest bet he ever made and the mistakes he learned the hard way. Email [email protected] to get hooked up with a pre-vetted salesperson, finance person or executive assistant. Show Notes: (0:00) Intro (3:24) Breaking down Nick's portfolio (8:49) The deal structure and terms (11:20) Fail: Buying a domain for $400K, killing out traffic (12:24) Fail Elon bought twitter + I invited competition (16:49) new owner syndrome (18:43) How to hire overseas talent (10-min masterclass) (27:18) Pieter Thiel's Stanford class (30:17) Suli's brutal advice (34:23) Holdcos is overrated (36:04) The tortoise always wins (38:52) one big thing (47:25) Roofing (51:07) Self-storage — Links: • Somewhere - https://somewhere.com/ — Check Out Shaan's Stuff: • Shaan's weekly email - https://www.shaanpuri.com • Visit https://www.somewhere.com/mfm to hire worldwide talent like Shaan and get $500 off for being an MFM listener. Hire developers, assistants, marketing pros, sales teams and more for 80% less than US equivalents. • Mercury - Need a bank for your company? Go check out Mercury (mercury.com). Shaan uses it for all of his companies! Mercury is a financial technology company, not an FDIC-insured bank. Banking services provided by Choice Financial Group, Column, N. A., and Evolve Bank & Trust, Members FDIC — Check Out Sam's Stuff: • Hampton - https://www.joinhampton.com/ • Ideation Bootcamp - https://www.ideationbootcamp.co/ • Copy That - https://copythat.com • Hampton Wealth Survey - https://joinhampton.com/wealth • Sam’s List - http://samslist.co/ My First Million is a HubSpot Original Podcast // Brought to you by HubSpot Media // Production by Arie Desormeaux // Editing by Ezra Bakker Trupiano /

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

• 0:00Shaan Puri?

  All right, look, on YouTube, everybody talks about how they're crushing it. Every business podcast, every business influencer is talking about how great everything is going. But on today's podcast, my buddy Nick is coming on and he's doing the opposite. He's talking about a bunch of the big mistakes he's made. He's eating humble pie publicly on the podcast today and talking about some of the things he's learned from it. So I want you to tune into this episode. He's talking about how he made the biggest acquisition of his life when he bought Somewhere.com, how he might have screwed up certain things and how he's trying to recover from those. It's another side to Nick. If you know Nick, he's, he's, he's a popular guy online, but you don't always get to see the, the humble side. And so I think it's a great episode with Nick. Enjoy.

• 0:47Shaan Puri?

  All right, what's up? We got Nick Huber here, friend of the pod. Nick, what's up, man?

• 0:51Nick Huber?

  Sean, thanks for having me. It's been a long time.

• 0:53Shaan Puri?

  Dude, you, um, you wrote something. So we have every guest do a little prep doc of like, hey, what do you, what are some things on your mind? Stories, ideas that you want to share? And you wrote one that I think is very interesting to people who've been following Nick Huber. So you built up this personality online of being confident, borderline cocky. You know, you have strong opinions. You are not afraid to piss some people off. And you said this in the document, you said, I have been humbled off my cocky attitude in my 30s. Is this a, do we have a heel, uh, what's the, a face turn like in wrestling where the bad guy becomes good? What's going on?

• 1:30Nick Huber?

  Yeah, man, I think the last five years in business, I mean, five years ago, you guys had me on the pod. I, I felt like I knew everything, man. Like, and I think it was that irrational confidence early in my career that I wouldn't trade for anything because I think it led to a lot of success and me, me putting myself out there. But yeah, man, like you just realized that business is hard. Business is really hard. So it's not the same as it was 2024, 2025, or not the same as 2022, 2023 for any entrepreneur I know.

• 1:57Shaan Puri?

  So give me an example of how Nick, what Nick was thinking then versus Nick thinking now? Because there's this great phrase, everyone's a genius in a bull market. I think part of what you're going to talk about is like back in 2020, 2021, 2019, like during that era. It felt like you could do no wrong, but like give me Nick back then, he was thinking XYZ about himself or the world. And now what is Nick thinking?

• 2:20Nick Huber?

  I thought business was easy. I thought building executive teams was easy. I thought customers just came. I thought I could do no wrong because I had this personal brand, started all these companies, started 10 plus companies over a three year period.

• 2:31Shaan Puri?

  Midas touch.

• 2:32Nick Huber?

  Four of them have been shut down. So yeah, it's not all roses.

• 2:37Shaan Puri?

  It's not all roses, but you are, you know, I guess older and wiser now and you've it's sure some things shut down, but other things you've sort of doubled down on and have started to work. What do you think caused that? Was it just market kicking your ass a little bit in certain areas that that sort of made you reassess? Were you wrong about a specific thing?

• 2:56Nick Huber?

  I thought with a personal brand that's strong enough, you could get into an agency business of any kind and go to the moon, whether or not you do a couple of things right, a couple of things wrong, whatever. And then, yeah, the algorithm changed, like business got a little harder. People started really watching how they're spending money. So I just think it's harder now than it was, man. Like, I know a lot of people who are making less money now than they were three years ago.

• 3:19Shaan Puri?

  Right, right. Okay, I want to jump around into some of your new ideas. So things you're feeling, thinking right now. So, you know, you mentioned being sort of humbled and you mentioned your portfolio going from, how many companies did you have kind of like at your peak? And how many do you have now?

• 3:34Nick Huber?

  Eleven. Yeah, I started 11 companies from, you know, 2016 was my first.

• 3:40Shaan Puri?

  You were like, I'm gonna do an SEO company. I got a storage company. I got a, what else did you have? You had a bunch of others.

• 3:46Nick Huber?

  Yeah, I had a paper, paper click marketing company called Ad Rhino. I had a sales consulting company called Huber Method. I had a business brokerage. I had, you know, on and on and on. So I went on a phase where I was like, I can't, I got the hot hand. My audience is super powerful. Like, let's scale up some companies.

• 4:03Shaan Puri?

  Do you remember at your peak, what the group revenue or of the companies you owned the majority of, group revenue or cash flow was at the peak? Because it was working for a little while, right?

• 4:15Nick Huber?

  Yeah, well, group cash flow right now is actually way higher than it was, but it's only because of like a three headed monster of the companies that rose to the top. So it's kind of like a power law thing, right? But of the six bottom ones, I mean, we were up to half a million dollars a month, maybe of total revenue. Yeah, I shut down four and two of them are, are, you know, treading water right now.

• 4:35Shaan Puri?

  Right. And so I think the most interesting lesson, uh, cause I've got to see it from the inside. I don't know how much of this you've shared, but we were both partners in a company called Somewhere. Actually, at the time it was called Shepherd and, um, people don't know the backstory here. So the backstory is Marshall, who's the founder, uh, was the founder of the company, owned the majority of the company. Then me and Nick both had a, a, a good, a good chunk, but in the minority. And Marshall calls and he says, Hey, I got an acquisition offer. I think I'm going to take it. And I was like, oh, wow. Talk me through it. What is it? And he tells us that Andrew Wilkinson, our buddy, other, other friend of the pod, he made an offer to buy the company for $52 million. And this was great. You know, this is a company that Marshall bootstrapped, didn't raise any money.

• 5:19Shaan Puri?

  So, you know, potentially a big exit, but it was a stock-based deal. And, you know, Marshall was going to take it. And Marshall had worked for Andrew when he was young. Uh, he had a lot of respect for Andrew. So I think it was like, part of it was like this, like, almost like full circle validation moment. But in a person, I think every entrepreneur can have that where it's like, wow, Facebook wants to buy my company. It's unbelievable. And then there's the financial component to it. And on the phone I was like, well, let me give you my opinion. And I realized very quickly, I was like, oh, he's actually already decided. This was a, let me, I just wanted to let you know, disguised as a, what do you think call? But you know, I'm, I'm a very opinionated guy. So not to be deterred. I was like, hey, listen, like, you know, we're growing really fast. I like our stock. Why would we trade our stock for, for other person's stock? Like, we should just keep our stock. It's growing. It's a small company. So by nature, it's going to grow much faster than these larger companies.

• 6:04Shaan Puri?

  And, um, you know, that stock might not be that liquid. Are you sure this is the deal you want to do? Then I call Nick and I'm like, Nick, what do you think? I had this opinion. You were very similar and we had this idea of like, if he's going to do, if he just wants to sell, maybe we could buy it. And originally that was some of the idea. And I said, oh, look, my, my life will get too crazy and complicated. I don't want to do this. But you were like, I'm going to do it. And so walk, that's where, that's where the story begins. Walk me through what happened. First of all, was that your same history? Did I mess anything up there?

• 6:31Nick Huber?

  Yeah. It was a 47, $47 million valuation. The company was three years old and growing really fast, about 150 employees. Um, I was a customer and then became an investor and had started to build worldwide teams. But yeah, here we are. Marshall calls me, hey, Andrew, Andrew wants to make an offer to buy the company. I realized, hey, I don't want to sell any of this company. If anything, I want more of this business. And this was peak, this was also just peak Nick Huber, you know, not humble Nick Huber of thinking I can do anything and I can't go wrong.

• 6:58Shaan Puri?

  And by the way, we had just tripled the business that year. So it wasn't like, it wasn't like we had any reason to not have confidence. Like the business had just tripled in cash flow. And so like, that was good.

• 7:10Nick Huber?

  Yeah.

• 7:12Shaan Puri?

  Hey, I got something pretty cool to share with you guys. So if you're like me, you listen to podcasts or YouTube videos, you like to take notes, you're here to learn. And that's a lot of effort. Sometimes you're on the go and you can't do it. And so the folks at HubSpot who are sponsoring the podcast have done something pretty cool for you. They have created the MFM Vault. It's a place to go find notes and resources that they pull from the different episodes that we do. So if we have a guest on that shares their five point framework, they write down those five points with the examples that the guest gave, and they put the notes there for you. So if you want to access the vault, it's totally free. All you gotta do is click the link in the description below. And you can access all the notes and the stuff in the vault. We're going to keep adding to this, trying to make it better over time.

• 7:54Shaan Puri?

  Thank you to HubSpot. This is a very cool way for them to sponsor the podcast, but by instead of telling you to go buy their stuff, they're actually giving you something instead.

• 8:04Shaan Puri?

  Okay, carry on. So you decide, I'm gonna, I tell you, hey, I think I'm probably not gonna do it, but you're like, I'm gonna do this anyways.

• 8:10Nick Huber?

  Yeah, I say, you know, Marshall, actually, I want to be the one to buy your company. You shouldn't sell it to Andrew. You should sell it to me.

• 8:17Shaan Puri?

  And his initial reaction is like, you and what money?

• 8:21Nick Huber?

  He had, he had a lot of questions. His jaw almost hit the floor. He's like, Nick, this is insane. Like, you kidding me? Like, this is life changing money. You sell 51, it was a 51% deal because he still needed, remember, he still needed me and you in because we were sending a lot of business in. He still wanted Marshall to have some skin in the game. And yeah, man, the next three month period, I,

• 8:40Nick Huber?

  Sold Marshall on the fact that I could raise 20 million bucks. I negotiated a seller note for a chunk of it. Had to get very creative with how I structured this deal because I realized real quick that it's not the same as real estate and how much skin I can get in the game.

• 8:51Shaan Puri?

  So let's talk through this because a lot of people will give high level numbers, valuation, sale price, but terms is where like anybody who's done deals knows like structure and terms matter a ton.

• 9:03Nick Huber?

  Yeah.

• 9:03Shaan Puri?

  Uh, in how a deal gets done, like an all stock deal, all cash deal upfront, earn out, contingency based seller finance, that, you know, it's a big, there's a big array of different ways that you can go down. So can you just give us the, the simple version of like, what was?

• 9:17Nick Huber?

  Yeah. So it was originally a $47 million offer from Andrew, but the business kept growing over the next six months that we kind of got this deal done. It became a $52 million purchase acquisition price. And let me be clear that Andrew, it was early on, it kind of felt like me and Andrew negotiating against each other. Holy shit, I'm negotiating against a titan.

• 9:33Shaan Puri?

  This guy's bought 40 companies, you've bought zero.

• 9:35Nick Huber?

  Yeah. Publicly traded business, you know, billionaire on paper for a while. I'm a great friend of ours. And then Andrew kind of just thought about some AI risk. He saw maybe some, some headwinds and he said, you know what, Nick, like maybe we'll do this together. It was kind of a conversation throughout. It wasn't as if we're, um, have any animosity between each other. Um, but yeah, it was, it was, I was going to raise $20 million to buy 40% of, about 40% of the company from Marshall. I realized that if I go out and raise $20 million to buy this company, I'm only entitled to a 20% carry on top. Once everybody gets their money back.

• 10:11Shaan Puri?

  Right. So the structure is you go to investors, investors give you 20 million, your deal with them is I get a 20% carry or profit share of, of that. So like, you know, you're only owning. So the 20, 20 million buys you what, uh, what percentage of the company?

• 10:24Nick Huber?

  So we're doing whole numbers. It was 39.25 for like 20 and change, but let's say 40% $20 million. I would need to get them all made whole, their money back, plus a hurdle to then get an eight percent upside, which is 20% of 40 million. So my ownership stock would go from about, about 12% to about 20%. I'd have to raise 20 million bucks. I'd put my name on the line. I would take all this risk, do all this work. Very quickly I realized like, I can't do this deal. Like it would be foolish for me to do this. So I went back to Marshall and said, Hey, I need to buy more of the company. And this is where we kind of got creative and I carved out an 18% seller note directly from Marshall to me.

• 11:05Shaan Puri?

  And a seller note is basically the seller saying, I will lend you essentially the money to pay me and you're going to pay me every year. Um, or every quarter, whatever you guys decided this. Uh, so what was that? That was 18 million? What did you just say?

• 11:18Nick Huber?

  That was about nine million bucks for 18% of the company.

• 11:22Shaan Puri?

  All right. So you, you all in, you raised 20 million from investors. You get nine million, nine point something million from Marshall. So you're in $29 million and now you're in charge and you've got peak energy. And I'm talking to you and we both are like, dude, we've had so many ideas of how we could turn this business, you know, from X to Y. This is going to be great. And then what happens?

• 11:47Nick Huber?

  Three things changed drastically. Number one, we changed the name from Support Shepherd. I'd said over too many people's shoulders, watching them spell Shepherd incorrectly. Smart people to know that holy cow, we cannot grow a big company with this name. So we bought somewhere.com for $400,000 shortly after closing. Changed the name from support shepherd.com to somewhere.com. Our SEO, our search engine optimization and our brand recognition vanished overnight. In that one fell swoop, we lost 300 leads a month of about a thousand leads that we had.

• 12:19Shaan Puri?

  So you lose a third of your traffic on your brilliant name change. Okay, next.

• 12:25Nick Huber?

  Yeah, let me, let me look at my notes. So number two, Elon bought Twitter.

• 12:30Nick Huber?

  Elon bought Twitter and started drastically messing with the algorithm quickly. And it went from me being able to tweet about hiring somebody in the Philippines for $5 an hour and send, you know, 3,000 website visits and 200, 300, 400 leads to the company. To virtually nothing.

• 12:46Shaan Puri?

  Right.

• 12:47Nick Huber?

  So my ability to send business to the company with my personal brand. Vanished.

• 12:53Shaan Puri?

  Okay.

• 12:54Nick Huber?

  The third thing is, um, I wasn't the only one to think international hiring was a beautiful business and, uh, many, many competitors started over the next, uh, six months to a year.

• 13:06Shaan Puri?

  And you guys were pretty loud about the acquisition, which also invites competition.

• 13:09Nick Huber?

  Um, right. You tried telling me over the years, by the way.

• 13:12Shaan Puri?

  I tried telling you this, but like, you know, everybody wanted to, to pound their chest. Natural, honestly, like, and I get it. There's actually an upside to it too, right? I think the month we announced, to be fair, the months, the two months after we announced the acquisition, it was actually peak growth because like a lot of people went and checked it out and realized like, wow, there's a reason why all these people use this service. There's a reason why there's a high repeat rate of this service is probably pretty good. So it did initially cause a burst, but it also created, you know, it emboldened the existing competitors to go harder and it, it created, you know, 10 new competitors, let's say.

• 13:43Nick Huber?

  Yep. And then the economy started to shift, like interest rates went up, a general like silent recession happened in a lot of different industries.

• 13:50Shaan Puri?

  Right. And our customer base, our customer base was not super well-funded AI companies or something like that where, where, you know, spending was, they're just spending, you know, sloshing money around. Like we help real businesses. So it'd be whether it's, you know, small business, agency owners who own a hundred percent of the business and the cash flow matters to them. It's e-commerce businesses where you're already on tight margins and that's why you leverage global talent because it improves your margins, but you might just stop hiring altogether. Uh, right. Like you might just actually shrink your workforce. Tariffs are coming. You don't know what's going to happen with that. So you shrink your workforce. You know, we would serve tech companies that were, you know, more responsible with their cash. And so like all these business owners that are, are great customers to have and a big

• 14:32Shaan Puri?

  part of our audience, they are obviously cost sensitive because they live in the real world. They're not VC subsidized with, you know, $50 million rounds where you can just aggressively go hire and spend against macroeconomic headwinds.

• 14:44Nick Huber?

  Yeah. Ecom, ecom headwinds, home service headwinds, construction headwinds, real estate headwinds means less people are hiring, less people are growing their teams.

• 14:51Shaan Puri?

  Right.

• 14:52Nick Huber?

  And I made a lot of bold, quick executive changes inside of somewhere when I, when I acquired it. The company had grown very quickly. It was doing 95% of its hiring in the Philippines. Executive assistants.

• 15:03Shaan Puri?

  Right.

• 15:04Nick Huber?

  We started to invest in Latin America. We started to invest in South Africa, finance talent in Egypt, building executive teams in South Africa, performance marketers, you know, high skilled, you know, actually how to structure and build a company from the ground up internationally.

• 15:17Shaan Puri?

  It's an important part. I'm making fun of some of the fun decisions because because there is a happy ending. It all works out. The company's back, it's growing well, all that good stuff. So then it's fun to laugh about mistakes. It's not so fun when if things go poorly, you don't laugh about the mistakes as much. You cry about them.

• 15:32Nick Huber?

  Yeah, we're making it sound like we're gonna sound like we're gonna end this in bankrupt, but.

• 15:36Shaan Puri?

  No, no, I guess the spoiler here, you give the spoiler, then we'll kind of keep going on the mistakes.

• 15:40Nick Huber?

  You know, over the last four months, if you compare it to before acquisition, those four months I was negotiating the deal, we're up about 60% from a revenue perspective. And over last year, it's 28%. So I'm still behind my like pro forma of what I hoped to do with the company when I bought it. But revenue is growing very healthily and our team is awesome. So I think we're doing a phenomenal job of finding people all over the world. I've learned a ton about worldwide recruiting. I want to give some people some tips too, how to do this themselves, like what to look for. But yeah, it's been a lot of changes.

• 16:09Shaan Puri?

  So the reason I wanted to share this is because 99% of people talking about their experiences buying and running businesses. The selection effect is the people who are failing, shut up, and the people who are succeeding, get real loud. And I think what's cool about you is that you you can give it and you could take it. And so like you are you are bold and you say what you mean, you say what you feel, you're not afraid to be wrong. And if you're wrong, you say I was wrong. And I really love that about you. I really respect that about you. I think that's actually quite rare. And in this case, like, you know, you're basically saying, hey, I went and did this deal. And then like, here's a bunch of things that immediately I did wrong or went wrong for me. And I had to like, you know, figure out how to do better. And I think that's actually like quite admirable.

• 16:51Shaan Puri?

  The second part of it is there was there's something that in in sports, they call a new owner, sort of new owner syndrome, which is anytime a sports owner buys a team, they immediately start changing everything. And because they're like, oh, I could I can do no wrong. I know how to fix this. I'm going to do all these great things in year one. And one of the things that I think is actually pretty interesting here is. Even though we've run this global talent company and we were finding talent all over the globe, we were mostly finding kind of junior and mid-level talent. So like, you know, whether it's assistants, executive assistants was like a big, you know, huge part of our business, sales folks, you know, whatever, there's folks like that. But C-suite folks, we would typically assume are, well, that's who I want to use, you know, different

• 17:35Shaan Puri?

  local hires, either, you know, in the same office as me or just American hires, expensive, big pay packages, you know, got a lot of pedigree with companies I recognize, you know, whatever. And so we did that, you know, we hired a bunch of executives and that was, I think, made total sense on paper. And I think one of the cool things that you figured out that I didn't see going into this was, since then, you have actually rebuilt not just the junior and mid-level, but actually the executive team with executive talent elsewhere. And I kind of took that and I was like, oh, I should do that in my businesses because that's actually like an even bigger hack. Because you were like, dude, I'm finding, here's this person in South Africa, they've got an MBA, they speak perfect English, they've worked for international companies and, you know, American companies that do work internationally

• 18:18Shaan Puri?

  for, you know, 12 years, they've been a financial controller controlling these budgets, and you can hire that person at this price? That's incredible. You know, you're saving, you know, huge amounts of money on really great talent and really hungry, low maintenance, hard-working talent all around the globe. And so that was, I thought, one of the bigger surprises to me and like things we got wrong that we kind of corrected. And I don't know if you want to say a quick thing about that.

• 18:45Nick Huber?

  Yeah, I have six Americans at somewhere out of 160 employees. RE Costseg, another company in my portfolio that's growing really fast, 130 employees, seven Americans, Bolt Storage, six Americans out of 60 employees. And they're all in sales and account management. Because I just can't replicate the Americans' ability to close deals, high-ticket deals. Now, we're close with a couple of South Africans, but a COO at RE Costseg, Johannesburg, South Africa, head of performance marketing in Bogota, Colombia, you know, head of finance, and IT consultant who got me through SOC 2 compliance, we got a certificate this week, in Cape Town, South Africa. So I used to think like, okay, I need, I need repeatable

• 19:26Nick Huber?

  tasks and I need to outsource those to the Philippines, South Africa, Colombia, whatever. Now I'm realizing that the people who can run my company can do it better and cheaper. Internationally.

• 19:38Shaan Puri?

  And I don't want this to be a somewhere plug, but you, you were like, dude, I could tell you how to do this without somewhere. I was like, oh, that's like an anti ad. So great. You could do somewhere, but here's how you do it without us. So how do you do it without us?

• 19:50Nick Huber?

  So we get, we get 60,000 applicants a month. Um, half of those are from LinkedIn and Indeed and Monster promoted job postings. Can tell you, I'm going to tell you exactly how we do it. The other half are from referrals and ads that we run out on the open market for people that already have jobs. But yeah, if you want to make your own hire, go on LinkedIn, post a job. I'd, I'd recommend Colombia, Brazil, South Africa, and the Philippines. Those are the four hottest places to hire in the country. If you're looking for finance, there's Egypt, you know, um, engineers, um, Eastern Europe and some other, in some other countries. But go on there, promote the job on LinkedIn with a hundred dollars a day and run it for five days. Post the job in those countries on LinkedIn, promote it with a hundred dollars a day, run it for five days. So you're in what for maybe two grand, you're going to get a thousand applicants.

• 20:36Shaan Puri?

  All right. But that's too many. How do I filter?

• 20:38Nick Huber?

  Yeah. So we have figured out, and I'm going to pass this on to you, is that of our 60,000 applicants every single month, 85% of them can't type 35 words per minute. And if we're talking about remote work in any role, from engineering to marketing to graphic design, to admin, to sales, to executive leadership.

• 20:57Shaan Puri?

  Your, your easiest immediate filter is typing speed, English test, basically.

• 21:02Nick Huber?

  Yeah, we're getting that down. We're getting that down to 5,000 people a month that are coming in the door.

• 21:06Shaan Puri?

  You wipe out whatever, 80% of people right away. Great. Uh, what's the next easiest heuristic to find great talent?

• 21:12Nick Huber?

  We're going to send them a request for a one minute video.

• 21:15Shaan Puri?

  Okay.

• 21:15Nick Huber?

  Where they film themselves introducing themselves for one minute. 80% of people are just not willing to do the work. They're not that serious about looking for a job.

• 21:23Shaan Puri?

  Right.

• 21:24Nick Huber?

  So the other 20% you're left with maybe a thousand, um, this is our talent pool, you know, you and with your job post that you got a thousand applicants, you're left with maybe 40, 30 or 40 people that can type over 30, 35 words per minute. And have sent you the video. You watch the videos, you look at the professional maturity, you look at how they communicate, which is a big part of the job. And you pick your favorite five to hire. Um, and then I love assessments. If there's, if they're, if they're coming into a sales role, I love sending them five calls from my sales team and saying, hey, break these down, record a three minute video on how you would, you know, missed opportunities or how they would improve. And that's, you know, then you're going to be left with three or four really great candidates and hire them.

• 22:01Shaan Puri?

  Right. Task-based test over interview is huge. We do that in all of our stuff.

• 22:06Nick Huber?

  I didn't even mention the interview, I guess.

• 22:08Shaan Puri?

  Well, I don't even, I don't even get to an interview at this stage. This is how we do it when I do this with, with Ben and our companies. And part of it is actually useful for you. So when you sit down, you say, all right, if I was going to give somebody a test that they could do in something like 60 to 90 minutes,

• 22:24Shaan Puri?

  what would most closely simulate the type of stuff I want to see them be able to do? So now you get clarity on what am I actually looking for, which most people, when they go into interviews, they don't actually even know what they're looking for. That's like sort of the dirty secret, why you make a lot of bad hires. So, once you do that, you get clarity, then they actually show you, and now you're not saying like, hey, you talked to this person. How'd you like him? I liked him so nice. It's like, no, no, no. We have an objective way to just say, here's what one person produced, here's what the other person produced. And we start with production, because that's what we're going to want in the end is production. And we will often, I don't know if you do this, but we will often just pay to like, hey, I'll pay you for the hour of time, two hours of time, whatever it is. Like, this is a paid task trial, because you're actually saving me money and, and time of interviewing and making a false hire,

• 23:06Shaan Puri?

  because I liked you and we had a nice chat, but you actually weren't good at doing the thing.

• 23:12Nick Huber?

  Yep, exactly. I want to give some people advice on like where to go as well, because I've learned a ton about what cities and what countries are hotspots for what type of talent. Egypt, Cairo, Egypt is the cheapest city in America, in the world, and you can find people who can work magic in Microsoft Excel and Power BI from a finance data analyst perspective. Colombia and Brazil are unbelievable for operations. They're on your same time zone. Just every single role, if they don't need perfect English, if they're not a sales role, South America is amazing. South Africa is a sales and finance hub. There's 30,000 South Africans that get on a plane and go to America every single year to do audit and tax work for big four consulting firms. They go back to South Africa and you can hire them for three grand a month to be a controller at your small business.

• 23:55Nick Huber?

  So yeah, it's just unbelievable areas. I love Sri Lanka as well for almost all roles. Philippines, obviously there's 30 million Filipinos working for American companies today. It's just deeply ingrained in their culture.

• 24:05Shaan Puri?

  So to give people an example of the assessment real quick, I just pulled one up. So this is what I use to find my assistant. So I basically gave this out and I said, I said, I want you to do the task and I want you to record a Loom video explaining what you did as you do each task, which tells me their thought process, shows me kind of how they work and not just like the end product. And I also get to hear them communicate and if they're like an easy person to communicate with. So my assistant task, I said, uh, pretend you're booking a vacation from LA to Paris for my wife and I. Our, our ideal dates are this, but we're flexible on those by a day or two. Here's our preferences. Send me a couple of options. The lowest cost option, the best option that balances convenience and cost. And maybe the most luxurious option, more expensive, but whatever. I want to see them put together kind of a menu of options. Cause that's typically how I work with my assistants.

• 24:49Shaan Puri?

  It's like, you get me to 90% and then I pick and choose what I want. Another one, I said, here's a voice note. I put a voice note on SoundCloud and I said, of me dictating while driving. Draft these two emails based on what I mentioned. And in, in that voice note, I'm like, hey, oh, I gotta, I promised X, so and so, I would introduce them to so and so. You know, I met them at lunch, blah, blah, blah. And then I try to see if they can just quickly grok, like, basically, can I write a fuzzy address on an envelope and will it still get there? Right? Cause I'm not going to get perfect instructions most of the time. So how do they deal with imperfect instructions? I'll have them do simple things like, hey, I've just moved to, from Texas to Wyoming and I don't have, I don't have changed my driver's license. Can you figure out how I need to go like, get like DMV work? Like, how would I get a new license? Could you do it all the way? And if not, what steps do you need me to do?

• 25:34Shaan Puri?

  And then, uh, like make a birthday card in Canva for my daughter's birthday. I want to see like, do they have like basic design and event organization skills? And the last one was like research. So it's like, hey, I'm looking for influencers for this new fitness product that I have. Find me 10 fitness influencers that fit this criteria. Let me just see if they're able to like quickly do data collection and research and be able to provide something useful to me. And so like, those are examples of what tasks I put out there. I put in a, that's a, that's a one page Google Doc. And they send me basically a loom video of them doing each task. And that's how I quickly filtered through, you know, 50 people. Like some were basically, it was like, hey, here's 50 people. Here's the four we like best. I gave them the assessment. I didn't like the first four. Then they gave me another batch of four and immediately there was someone who was great.

• 26:16Nick Huber?

  Yeah, they, they shine. The, the, the person who's competent will shine to the top of the crowd without any work on your end. It's a, it's a beautiful thing.

• 26:25Shaan Puri?

  You were basically saying like, uh, you know, you find all these different talent. So people can go find it themselves. If they wanted to find it through somewhere, like what is the, what is a simple way to do that?

• 26:36Nick Huber?

  I mean, we we prepared kind of like a special thing for your audience. Do you want to talk about that now? Or you just want to talk about like generally how the company works?

• 26:41Shaan Puri?

  Yeah. What is it? What do you have?

• 26:44Nick Huber?

  Yeah, I I in advance of this episode, I personally vetted and interviewed 10 salespeople in South Africa, 10 finance folks in Egypt, LatAm and South Africa, and 10 executive assistants in Sri Lanka, LatAm and South Africa.

• 27:01Shaan Puri?

  Gotcha. So you did a personal vet shortlist for each of them?

• 27:04Nick Huber?

  Yeah, I watched their videos. I analyzed their resumes.

• 27:06Shaan Puri?

  What do you want people to email you? Or how do people get access to that?

• 27:09Nick Huber?

  Yeah. So if they email me [email protected], I can hook them up with some of these profiles, let them see them, and hopefully help them grow their team.

• 27:19Shaan Puri?

  That's cool. I'm curious, man. You are always meeting interesting people, partly due to having a presence on Twitter, partly just, you know, you have like one foot in the sweaty startup world, one foot in the tech world, online media world. I'm just curious, like, who have you met recently that kind of either inspired you, or like, you know, broke your frame in some way, or somebody who you think is doing some cool stuff?

• 27:39Nick Huber?

  I have one person in mind who's building a pest control like monster of a company. I don't want to out him. It's just incredible to me. You know this. You've actually taught me a lot of this stuff is that they find one thing that really works inside their company, and they just run the same play for five or 10 years to grow a monster business.

• 27:56Shaan Puri?

  Just hammer it.

• 27:57Nick Huber?

  I didn't think that business worked that way. You could do one thing really well, and everything else, you know, you're not hiring internationally, you're not doing the latest software, you haven't even looked at AI, you're not answering the phone past 5:01 PM.

• 28:09Shaan Puri?

  Right.

• 28:10Nick Huber?

  But you do this one thing well, and you're worth $100 million.

• 28:14Shaan Puri?

  Right.

• 28:16Shaan Puri?

  Today's episode is brought to you by HubSpot. Did you know that most businesses only use 20% of their data? That's like reading a book, but then tearing out four fifths of the pages. Point is, you miss a lot. And unless you're using HubSpot, the customer platform that gives you access to the data you need to grow your business, the insights that are trapped in emails, call logs, transcripts, all that unstructured data makes all the difference. Because when you know more, you grow more. And so if you want to read the whole book, instead of just reading part of it, visit hubspot.com. Have you ever seen Peter Thiel taught a class at Stanford and they put the class notes online? And it's been there for a long time. It's called the Blake Masters Notes or something like that. Did you ever read those?

• 28:52Nick Huber?

  No, what's the main takeaway?

• 28:54Shaan Puri?

  So he's got one, which is he's like, um, you know, I get a lot of investor pitches. And yeah, I've invested in, I was, you know, the seed investor in Facebook. So if you have some huge winners and you have a bunch of losers, what do you notice with them? And he's basically, he's like, one of the biggest poker tales with the business is when they have seven revenue streams. That actually, they think, they come in puffing their chest, being like, look, we've got seven. And he's like, all they've told me is they don't have one great one. And same thing with distribution channels. When I asked them, how are you going to get customers or how do you get customers today? And if they tell me seven things, all that tells me is they don't have one amazing thing. He's like, all the best companies, and this is the best companies. They find one, they basically end up with one distribution channel that really, really works.

• 29:35Shaan Puri?

  And one revenue stream that really, really works. And so it's like, you know, for Facebook, for example, the distribution channel that worked was viral photo tagging on campuses initially, and then eventually off campuses. And then the monetization was ads. And Facebook didn't need to sell stickers and didn't need to do like a thousand other things that all the other social networks were actually doing. Like M and M's did a homepage takeover and we've signed this deal with this movie studio and they're going to do like a cool campaign with us in partnership. And like, Facebook was like, self-serve banner ads will be the thing and this, and this will be the growth tactic.

• 30:09Nick Huber?

  Brad Jacobs, Brad Jacobs with How I Grew United Rentals and several of these other companies. He ran the same plays.

• 30:14Shaan Puri?

  What was his, what was his play? I actually don't know.

• 30:16Nick Huber?

  I'm sure he had several different plays, but how you make a few billion dollars is like, you find a way to grow, uh, you know, equipment rental business through, is it local ads? Is it outbound sales? They had a really good outbound sales team for contractors. And then boom, that business skyrocketed. He pulled the same executive team, pulled his main players out of that company. Once it went public, put them in the next one and boom, you know, that's how you grow five companies in a row. Figuring out, figuring out what companies that play will work for.

• 30:44Shaan Puri?

  Right. I've told this story, I think before, but um, it's, it's probably one of my most like, I don't know, humbling and insightful moments. You know, like a hard lesson learned very quickly, a band-aid that got ripped off for me. So we have a buddy, um, Suli, who you know, and Suli's like, to me, my business Yoda. Like if I got a business problem, I go to Yoda and he gives me the like. He can't even really explain it. He just sort of like, he sees through all the noise that I bring him and he just finds the thing. So my ecommerce business was, was early on, it was growing. And so I think we were at maybe a hundred thousand a month in revenue. So like, you know, like kind of like a million dollar thing. It was like early on.

• 31:29Shaan Puri?

  And our, how did we get there? We were doing Facebook ads. So he told me, do Facebook ads and focus on Facebook ads. And I was like, but what about Google? He's like, but what about what I just told you? And I was like, okay, cool. So Facebook ads is working. I feel super accomplished. We've gone from zero to a hundred K in like three months. This is awesome. So I go to him, I'm like, dude, it's working. I'm thinking now we should do influencers and we should do, we should spin up Google because you know, of course, who doesn't do Google? But like, I really think influencers could work. Here's this cool influencer idea I have. And he would just basically just cut me off and he was just like, he's like, you want to win, right? And I was like, yeah. He's like, uh, cool.

• 32:03Shaan Puri?

  Don't say the word influencers until you're at 300,000 a month just off of Facebook. And I was like, I was like, but would it be bad? So let's like do both. He's like, well, here's the thing. Is there any reason you believe that Facebook can't get you to 300,000? No, it's got us to 100. Why couldn't it get us to three? And he's like, and if we couldn't get Facebook to three, do you think any amount of influencers is going to save us? It's like, no, like a successful econ brand should be spending basically one million plus per month in just Facebook ads. Right. Which means you're making more than a million dollars off of Facebook. Like that's where you're trying to get to. That's the goal. And like, you kind of have a broken company if you can't really get there. Like, most econ companies went off of Facebook ads. So like, you should just try to win off of Facebook ads before you go do all this other shit.

• 32:46Shaan Puri?

  And so just, and I was like, I had expected when I was like, gonna get advice from him, that he's gonna give me these amazing strategies, these like new hacks, these brilliant tactics. And actually, the most useful thing he did for me was just say, don't say the word influencers until Facebook is cranking 300,000 a month to your business. And just, and by the way, we kept it going after 300, we did 500, after 500, we did a million. It's like you just keep going off of just those two. Guess what? I still don't do influencers. Like it's now five years later, we didn't need it, you know? And, and I definitely would have distracted myself with what sounds like a good idea. And it comes back to the Steve Jobs quote, which is focus is not about what you say yes to. It's about saying no to otherwise great ideas.

• 33:31Nick Huber?

  One of my companies was making, you know, spending upwards of $150,000 on paid ads a month. We realized that, hey, our ROAS is barely breaking even. We calculated it down to the profit and realized that that piece of the company was making us maybe 15 to $20,000 a month in profit. And we're spending tons of executive time and energy to try to get that to work. And we looked at our other part of our, you know, revenue stream and it said referrals. Referrals coming in the doors, generating $250,000 of profit per month on, you know, maybe $30,000 of referral fees and discounts. Um, why, what would happen if for six months, our entire executive team laser focused on growing that referral number? And do we think that we'd be better off than, you know, maybe the last year and a half?

• 34:15Nick Huber?

  We've been trying to get, you know, slam a round peg into a square hole. And I think it's unbelievable. The job of a CEO sometimes is literally just to tell your team no, and to get them focused on what's already working.

• 34:28Shaan Puri?

  Yeah, yeah, exactly. And not hedge. Like, you know, I would, uh, I would say no, but then we kind of green light this little test. I would say no, but then like two weeks later, we just do it anyways. What happened to our no? Was that not a real no? And I think there's all these ways where you can think you're compromising or you're, you're having your cake and eating it too. But actually you're just spilling your cake on the floor and it's better to not do that. All right, let's take a quick break because I gotta tell you a story. Let me tell you about the first time I tried to run payroll for my team. I was using a traditional bank and you know, the type, it's got a janky interface. It's built like a 2002 tax form and it was open only during business hours. And I hit send and it froze. They flagged the transaction. They locked my account. They put me on hold for 45 minutes and then they told me I gotta visit my local branch.

• 35:12Shaan Puri?

  And that was the day I started looking for a new banking solution. Uh, after asking a few founders what they were using, I found out about Mercury. And so now my payroll is two clicks. I can wire money. I can pay invoices. I can reimburse the team. All from one clean dashboard. That's why I use it for all of my companies. And so do 200,000 other startup founders. And so if you're looking to level up your banking, head to mercury.com and apply in minutes. Mercury is a financial technology company, not a bank. Banking services are provided through Choice Financial Group, Call MNA, and Evolve Bank and Trust, members FDIC. You said, "Running a holdco is overrated. I think the trend will die down." Most rich guys I know are focused on one big business and built it for a long time. So, holdcos or these portfolios of businesses like you were doing was a very, very big

• 35:55Shaan Puri?

  idea or popular idea in our circles, in our bubble about five years ago. And it's not a new idea. Holdco's been around for a long time. Give me your updated thoughts on the holdco.

• 36:04Nick Huber?

  Man, I think over the last three or four years, I've been kind of labeled as one of the holdco guys. You know, there's several more of us, but I've had a lot of people reach out. You know, I got this plan to, you know, I'm going to buy more companies. I'm going to do this, I'm going to do that. I'm going to grow to five, eight, 10 companies and the synergies and all this stuff. I think you really got to know your shit to run more than one company. And the majority of people that I know who run more than one company, they ran just one company for a long time, made it really good, made it really profitable, learned how to build executive teams, learned how to build compensation plans, learned how to work the funnel and convert at the highest rate all the way down the funnel. If you don't know those things and you start going around buying different companies, especially if you use leverage, borrow money to do it, buy companies, whatever it might be, things can go really wrong really quick because unlike real estate, which was my

• 36:49Nick Huber?

  first business where you get a couple of clients in and they pay rent every single month, operating companies, man, you can have massive swings in revenue and profit. So yeah, I think everybody thinks it's cool. Another thing about it is you just solve freaking problems all the time, like the biggest problems in each individual company bubble up and come to you. So yeah, I don't know. Like when I look at some of the wealthiest people I know, some of the wealthiest people that you've had on your pod, almost all of them focused on one thing and made that one thing really big. So I think there's something to that.

• 37:20Shaan Puri?

  One source of problems rather than 10. All right, another one you have here, consistency is underrated. You're on the consistency train. What's your take here?

• 37:28Nick Huber?

  Yeah, I think it's really easy to get excited about something and jump in and be delusionally like focused on one thing for one year, even two years, whether it's business, a certain idea, your physical health. I know people who are, they're either running a marathon and cutting, cutting calories and super fit and super clean and super healthy, or they're totally falling off the rails and doing the opposite while they're focused on something else. It's kind of sexy to just jump in and be totally all obsessed with something. The people who win are like even keel. Maybe they're not working 70, 80 hours a week. Maybe they work 50 hours every single week for their whole career, or even 20, 30, 40, whatever it is. But it's hard. It's hard to stay excited about something for a long

• 38:10Nick Huber?

  time without getting burnt out. But I think it's a superpower. Like if you can be even keeled in all areas of life, I'm not just talking about business, but mostly business. If you can just keep from gaining weight up the first time, it's gonna be a lot easier to stay healthy the rest of your life. You can just stay focused on one business or a certain way that you do things and, you know, get after it, you can really win. I know a lot of guys who they're either kicking ass inside their companies, or they're like totally checked out and like ignoring the hard decisions.

• 38:41Shaan Puri?

  And they wouldn't have thought they would get there, but how do you get there? You get there because you, you didn't understand how to have a sustainable burn. You had a bonfire and then it goes out. You know, I used to be in college, like a proud procrastinator. I would wait till the last minute. I'd pull an all nighter. I'd study. I'd pass the test and I would wear that like a badge of honor and it became like a terrible habit and sort of identity to build around. Was this thing of like, oh, when I turn it on, I have this crazy intensity. Nobody can work harder than me for that 72 hours. But then I'm gonna crash and I'm gonna procrastinate because I know I always have that in the tank.

• 39:23Shaan Puri?

  And it's the sort of tortoise and hare thing where you just realize that the tortoises win in life. And the tortoises that just keep putting one foot in front of the other every single day, they win. And so like I've actually far shifted my philosophy where now when I hear about somebody who has that same attitude I used to have of the badge of honor of like how hard they go and how how crazy they're working, it's a sign of weakness. It's like, oh, you just don't have systems. Or you don't understand leverage. You don't have good judgment. You don't know where to put your energy. So you're just putting it everywhere because I used to be that guy. I slept in the office. When I was 24 years old, I remember I slept in the office 224 days out of a year. I thought that was me grinding. Actually, it was me highlighting to everyone, waving a flag, saying I'm an idiot. I don't know. I don't know what to do. So I'm just here all the time, just manically doing anything I could think of, right?

• 40:08Shaan Puri?

  And now I have a totally different productivity routine, which is basically I call it the one big thing method. So every morning, I decide the one thing that matters that I'd get done today. The one thing I put all my core focus on and I give myself two hours to focus on it. First thing in the morning, no distractions, don't check stocks, don't check the mail, don't check Twitter, don't check anything. And I just focus on that one thing for two hours. And after I'm done with that one thing, anything else I do in the day is gravy. I can go play with my kids. I can go work out. I could do, I could do a little more work if I wanted to, but it doesn't matter because what I realized is the person who wakes up every day, 365 days, identifies the proper single thing that matters and puts full focus on that one thing for even a two, two and a half hour time, time span.

• 40:52Shaan Puri?

  They will crush the average person who simply doesn't even identify the one big thing. Because you do that for 365 days, you have a hell of a year.

• 41:00Nick Huber?

  It's the ability to zoom out. So many entrepreneurs, they're so focused, they're so intense, they're so jammed up in the weeds inside their company. And look, sometimes you gotta do that. Like I'm, I've been in the weeds in several of my companies, but the people who can really zoom out, like you're saying, what really matters here? And you do that for four or five years, six years, 10 years, 20 years?

• 41:18Shaan Puri?

  Right.

• 41:19Nick Huber?

  Man, father time, like it's really sexy to build businesses fast and it's exponential growth. And you hear about all these stories, we read about them and it takes over media, especially social media.

• 41:28Shaan Puri?

  Well, you've seen that meme almost at this point. It's not supposed to be a meme, but it looks like a meme now. It's like fastest company to 100 million ARR. And it's this, these charts and it's like, well, Slack took seven years. And then it's like, we did it in two weeks. There's like the new AI company that's got a straight line up. And then, then somebody else comes in and says, we did it in two minutes. We did it in two seconds. And that's what they're, they're all trying to just beat each other to this like sprint to, to low quality revenue. And I think it's so funny. It's like in The Big Short where he's like, why are they confessing? And he's like, they're not confessing, they're bragging. And it's like, I think they think that's a great thing. And it's like, the more impressive chart is the one that looks like Qualtrics.

• 42:12Shaan Puri?

  You know, we had the founder of Qualtrics on and he said, he has a huge sign in his home office. It just says, tune out the noise, play the long game. And he was like, dude, for seven years, nobody cared about what we were doing. We were single-mindedly focused on getting 150 universities to use our thing because we knew that was super important. If we did that, we had a real business and it took us time, but we just stayed scrappy. We stayed focused and we just did that for years before we ever got any press, any social media, any, anything. And it's like, that's who you don't want to compete against is somebody who can do that. Cause they're building this giant foundation of what they're trying to do. It doesn't mean go slow. It just means don't get fooled into thinking that you need to, you know, sort of quickly sprint and just grab some revenue number out of thin air as like what success looks like.

• 42:56Shaan Puri?

  Success is this sort of durability over time.

• 42:58Nick Huber?

  There's expectations, like people have to realize that the expectations of yourself as an entrepreneur in your career, they depend on your last six months, your last 12 months, your last, you know, two years. If you've had that hockey stick exponential growth, like think about how you have to follow that up. And I think some of those entrepreneurs kind of dream of a world where there's no investors, nobody watching, growing slowly over time, building something sustainable.

• 43:22Shaan Puri?

  Yeah. Well, okay, you have some other ones here. You said, um, being a YouTuber is the hardest job in the world. I think some like coal miners might disagree, but go ahead.

• 43:32Nick Huber?

  Well, I think social media is changing. Like, we can talk about how the X algorithms changed, how it feels to be a content creator is totally different now. You almost have to be video first. I don't know if you feel this, Sean. Like, if you aren't on YouTube, you are not growing right now.

• 43:46Shaan Puri?

  That's true. I think there's always exceptions, but it's largely true. And I've said this before. Video is the language, the native language of the internet. So it's like going to a country. If you don't speak video, then you are not going to be able to communicate because that's, that's what everybody here speaks is video. Short form, long form, doesn't matter.

• 44:02Nick Huber?

  Yeah, as an entrepreneur, I'm really hesitant to get on that hamster wheel because I see, I see what the life is like of, okay, you got this banger video, your influence grows. Got to follow it up the next week. You got to follow it up the next week. You got to follow it up the next week and you got to be on. And then we go back to that consistency conversation that we just had. Living that life for 10 years, living that life for 10 years, like, how would that look? How would that feel? I think it's a very difficult job. I have a ton of respect for people who do it. Um, I think it's still worth it, but in my opinion, the value of a personal brand, um, on all things not video is going down, in my opinion.

• 44:38Shaan Puri?

  All right, one more spicy opinion here. This might be the spiciest of all. AI is bullshit and unsustainable and will decrease quality of life for the 99%. Wow. Say some words about that.

• 44:51Nick Huber?

  This is just like the internet boom where, you know, 0.1% of the companies will survive whatever happens when, when the bubble, you know, changes and will, will go on to change the world over the next 20 years. I'm not doubting the long-term power of AI. I'm just looking at the money, the hype, the energy that's being poured into it. I'm spending a lot of time inside of my companies trying to implement AI. We're adding tools. And I'm just not seeing it, Sean. Like, AI is unbelievable for, you know, me having a doctor in my pocket or me doing recipes or my wife, you know. You know, doing little things, but man, like, where is the long-term value? And then when I think about where it's going and I'm seeing my energy bill in Athens, Georgia, which is not an energy, you know, like, an area with an energy crisis, like some areas

• 45:36Nick Huber?

  of Texas and California, my energy bills went up 60% in the last three years. They've raised it six times.

• 45:43Shaan Puri?

  Wow. That's because what, data centers being built?

• 45:45Nick Huber?

  There's still double, there's 30 data centers that have come online in Georgia in the last four years. There's still 30 more in the pipeline being built right now that have negotiated unsustainable energy rates with the local municipalities. Where does it stop before like, okay, the companies are able to put AI in place to replace employees, but the energy cost, and this is why I think for 1% of people, it could get really ugly, or for the rest of the people, it could get really ugly. Like, what about your ability to like, run a dishwasher, or run an air conditioner, or run a heater in your house, which all require a massive amount of electricity? That gets more expensive for almost everybody. You have less money to spend on other things to make quality of life better. So, yeah, hot take, but man, I'm very bearish on AI right now.

• 46:28Shaan Puri?

  You said it's bullshit and unsustainable. But you said, also, you said, in the next 20 years, it's going to change everything. So it's not that you think the long-term is, is, you're saying that something today is over-promised. What, what is it? And you're saying, personally, you're getting value, doctor in your pocket, recipes, life, day-to-day stuff. It's the business use that you're not seeing the...

• 46:47Nick Huber?

  I've added 15, I've added 15 AI tools across my portfolio. We've canceled 13, 11. Like, there's some that I really like. The others, I'm just like, really, really hard to justify the cost already. And they're, and they're subsidized all the way down the chain. You know, Nvidia's selling the chips, they're making the bank, but, you know, Amazon Cloud Services, they're subsidizing it all the way down to, you know, the actual company that's VC-backed, that's subsidizing the data usage to try to do the land grab. So it's going to get more expensive. And I also feel it's kind of like the electric cars and self-driving with Elon Musk, how he's been promising us for 20 years that self-driving is five years away. It's going to get harder and harder and harder and harder to continue to improve AI from here and require exponentially more energy. So I worry about energy mostly.

• 47:31Nick Huber?

  Like, if, if we had nuclear power plants all over the place, like, I'd feel much different about AI.

• 47:36Shaan Puri?

  Do you have a Tesla?

• 47:37Nick Huber?

  As soon as they make a Cybertruck that doesn't look like a Cybertruck, I'm all in. Like, I want full self-driving. I know how safe it is. I'm not willing to drive a sedan because they're not safe. Somebody T-boned me.

• 47:47Shaan Puri?

  Dude, I bought one. It is, the self-driving is unbelievable. It is so good. Like, I also, before I bought this car, I also thought like, the narrative was Elon's been promising, he hasn't delivered it. It might be harder than you think. Maybe you can't even do it without, without LIDAR or whatever. And then I buy the car, I push the button and it drives me everywhere flawlessly. You know, and I'm like, this is here. This is already working. You know, this is incredible. And I think the data backs up the personal experience.

• 48:18Nick Huber?

  I have, I have ridden in full self-driving and it is mind-blowing. It's mind-blowing. I want it. I need it. But, like, is it gonna be widespread? Is, are we gonna have, you know, robo-taxis like San Francisco all over the country? I still think we're 10 years away from it. And Elon said it'd be 2012 that we were gonna have this happen.

• 48:33Shaan Puri?

  Yeah, yeah. He, uh, his timelines have been wrong. Um, but I, but I think that's more, that's less to do now with the tech and more to do with the regulation at this point. So, uh, which I think is a, is a different, different question. You mentioned pest control. Are there other businesses that, uh, you've found interesting? Or like, you know, you've been surprised at how well they're doing or a niche that you, you know, you, you nerded out about a little bit?

• 48:55Nick Huber?

  Everybody wants to start a marketplace. I think maybe, I'm, I'm five or 10 DMs a month of somebody saying they found, you know, there's a kitchen cleaning, you know, you go, you go in at night and spray down hoods and clean the inside of a kitchen. And I want to start a marketplace that connects restaurants to these people. And then I was doing my roof on one of my commercial properties. And our bid came in to do this roof. It's about a 10,000 square foot warehouse. At about 70 grand to do the roof. And I'm like, that seems high. Like, let's, let's do some more work. And I found out that I can hire a sub for 30 grand worth of labor and I can buy, you know, 15 grand worth of material. And I can, that's the hard cost to do this job. And these roofing companies are making the spread. They're making the spread. So they literally don't do any work. They sell the job, they quote the job, they carry insurance.

• 49:41Nick Huber?

  And then they show up and stand there and watch and make sure the crew does a really good job and make $20,000 in a two-day job. By getting a sub and actually selling the job, putting their name on it, billing the customer, collecting the money, pay the sub and move on. So is that sexy and exciting? No, but are there roofers running around every town in America making 5, 10 grand a day? Yes.

• 50:01Shaan Puri?

  I'll give you a fun example. So at my daughter's school, I've gotten to know some of the other parents and say, oh, cool. What do you do? One of the guys, he does, and I'm so lack of handy that I don't even really know these terms, but he does like framing, framing, I think is like you put up the wood, but you don't like, you like to kind of build part of it or whatever. You frame the, the building that you're going to build. I was like, cool. So how's it going? You know, where, where's the project? Have I seen it? You know, what do you do? He's like, oh, I do hotels. Have you, have you, is there one I've stayed in here? He's like, well, I do all my work in Alaska. And I was like, Alaska. And he's basically like, again, work smarter, not harder. You know, his take was basically, look, I can be the thousandth best framer in California right now, coming in as like a new guy into the space,

• 50:43Shaan Puri?

  who doesn't have 20 years of referral relationships with all the other contractors and try to scrape and claw, do business with expensive labor here in, in California and have, and be, you know, competed down to the bare margin because they can bid it out to 30 guys. And whoever comes up with the, you know, the lower priced option is going to win. He's like, but if I go to Alaska, it turns out they just don't really have any many, very, very many framers. It's like, it's easier for me to get on a flight once a month and go to Alaska than it is to me, for me to build that business here. And it's like, I, I saw that. I was like, man, there's this like, you know, Munger has this great quote, you know, the secret to winning in life is, is weak competition. It's basically like, go where there's fish, but not other fishermen.

• 51:24Shaan Puri?

  And it feels like, it would feel so foreign to me and most people, if you're doing a business to be like, well, how do I, I live here. I kind of feel like I should do something about, or something familiar where I see it. It's like, we will go into a knowingly harder situation because it's more familiar than take on some unknown where there might be a total greenfield opportunity. And he's not innovating. Like, it's not like he had to be the, do you some new technique in framing or whatever? He just went to a place where there's just not a lot of people offering that service.

• 51:56Nick Huber?

  Yep.

• 51:57Shaan Puri?

  And I just think like that one principle, you know, if you're a hardworking person, like that one principle can be the difference between, again, being the thousandth contractor here with razor thin margins and making great margins and having to get on a flight once a month. And I just think like, I want, I think about a lot of people in my life who, there's more people who could benefit from that principle of just go where it's, where the, where the supply is low or the competition is low because it's unfamiliar for most and you, you might prosper.

• 52:25Nick Huber?

  We built our first self storage facility six hours from where we were living. Borrowed, borrowed $2 million from a bank, spent $3 million to build a self-storage facility six hours away. And now I'm in Athens, Georgia, which is another different city. And people are like, oh, you're in the self-storage business. Like, which one in town do you own?

• 52:41Shaan Puri?

  Right.

• 52:41Nick Huber?

  And I'm like, they're nowhere near here. I'm sorry.

• 52:44Shaan Puri?

  Yeah. In storage, what was the insight on location for you? So, um, did you find like, oh, this, a certain strategy on location worked well for you?

• 52:53Nick Huber?

  Yeah, we didn't even, we didn't even talk about real estate. It's been a chaotic, you know, three years in real estate. As interest rates have risen, just total carnage in the business. Luckily, we've done some things operationally that, you know, give us a little bit of an advantage, but.

• 53:05Shaan Puri?

  I'm sorry, explain why that is. So for somebody who's not in real estate, why does interest rates going up create, as you said, carnage in the real estate market?

• 53:12Nick Huber?

  Because of the biggest line item, the biggest expense for real estate investor, developer, syndicator, anybody who buys real estate, holds it and tries to cash flow is, is debt.

• 53:21Shaan Puri?

  Right.

• 53:21Nick Huber?

  It's our biggest line item. We, we're going to borrow anywhere from 50 to 70% of value of a building. And if you go from paying three and a half percent on that debt, you know, 35 grand to service a million dollars in debt to serve, to pay 7%, 70 grand. Like it's, it's, imagine if your labor cost quadrupled in a service business. That's essentially what happens in real estate. So it drives the value, what people can afford to pay down. So all the buildings that you bought in 21, 22, I mean, there's guys that are, there's guys that are going broke in the real estate business right now in real time that I know. It's total carnage because they can't sell their buildings for what they were worth because nobody else can afford to pay that higher amount of debt interest either. Does that make sense?

• 54:03Shaan Puri?

  Right. What's going on with your properties now? Cause that was, that was the time when you were buying too. So.

• 54:08Nick Huber?

  Yeah, we bought a lot and we had some stress, dude. Like we had some tough conversations. We, we got out without raising any additional money from our investors and we replaced all of our loans. Meaning we refinanced them and we didn't have to call a single dollar from our investors. That's a massive win. Many people else are calling capital calls or they're actually losing properties. We were able to increase revenue quite a bit when we bought a building and we've done things now. Like we replaced our inbound sales team with South Africans who are actually sales trained. And our conversion rate went from when we were in the Philippines from 30% to 42% in South Africa. So revenue is up 15% year over year. But yeah, man, it's not easy. It's brutal.

• 54:50Shaan Puri?

  Is the future for Nick Huber buying more storage facilities? Is it just running somewhere and growing that? Is it something else, you know, five years from now? Like, do you know what's the future for Nick?

• 55:01Nick Huber?

  You know, I have my ego has written a lot of checks over the last five years. Now I gotta go cash them. No, I'm pretty focused on growing somewhere. I want to grow Ari Kosseig and I want to buy more storage. We have a couple of deals under contract now. The company's in a good place and there's just so much less competition in the real estate business right now. So it's a double edged sword. I just think business is naturally cyclical. It really is like there's really good times and there's harder times. And sometimes the hard times are good because you gotta buckle up. You gotta operate, you gotta make things to make your business more efficient. And it washes out the people that can't do that and it becomes less competitive. So I'm genuinely excited about the real estate business over time.

• 55:44Nick Huber?

  I think we're better than anybody in the world at finding amazing talent at somewhere. And yeah, so I'm going to grow some of these companies. I want to grow some of them really large.

• 55:53Shaan Puri?

  Very cool. Well, man, I appreciate you coming on. It was fun to catch up.

• 55:57Nick Huber?

  Good deal. Thanks for having me.

• 56:10Sam Parr?

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