The "Idiot Index": the simple math that made Elon Musk billions

Get our Unsexy Business Idea Database: https://clickhubspot.com/sfci Episode 831: Sam Parr ( https://x.com/theSamParr ) and Shaan Puri ( https://x.com/ShaanVP ) tell the story of a $270M/yr meat purveyor plus Nick Sleep’s letter and the framework that will make Elon a trillionaire. — Show Notes: (0:00) The $300M butcher (18:28) Nick Sleep letters (23:20) the idiot index (35:44) breaking your own frame (39:04) how to become a king maker (51:49) Idea: Teen nerd awards (57:23) Sam's List — Links: • https://www.lafrieda.com/ • https://www.omahasteaks.com/ • https://drinklmnt.com/ — Check Out Sam's Stuff: • Hampton (joinhampton.com): My community for founders. Average member does $25m/year. Many of the guests are members. Get after it...apply: http://joinhampton.com/mfm — 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 • I run all my newsletters on Beehiiv and you should too + we're giving away $10k to our favorite newsletter, check it out: beehiiv.com/mfm-challenge 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?

  The headline here is the $300 million butcher.

• 0:03Sam Parr?

  I'm in.

• 0:04Shaan Puri?

  It's just a reminder that if you're the best at anything, money will never be a problem for you.

• 0:18Shaan Puri?

  All right, um, Pat LaFrida. Do you know who this is? Pat LaFrida? Freida? I feel like you definitely know who this is because this is like, this, you know, if there's two things that you like, it's red meat and denim jeans. So I feel like this is right in your alley. It's a family owned business. Do you want to hear the story here?

• 0:33Sam Parr?

  Yeah. Oh, man. I love the name of his website. Pat LaFrida Meat Purveyor.

• 0:39Shaan Puri?

  Purveyor. So good. We changed this podcast name to, uh, my first million business purveyors.

• 0:46Sam Parr?

  And my hot dog stand, its first logo was Southern Sam's Purveyors of Fine Wieners.

• 0:52Shaan Puri?

  Was it actually purveyors?

• 0:53Sam Parr?

  Yeah. Yeah. If you Google Southern Sam's logo, you'll see the logo.

• 0:57Shaan Puri?

  Oh, wow. This is like a legit looking logo. Purveyors of Fine Wieners, premium quality. And then you have the smoke and the hot dog with the smoke lines coming off.

• 1:07Sam Parr?

  Yeah, it's good, right?

• 1:08Shaan Puri?

  Although there's something like wrong with like the beveling of these letters.

• 1:12Sam Parr?

  Wow, I paid this guy Billy. It was Billy from Nashville. I gave him 50 bucks and he gave me this logo. So.

• 1:19Shaan Puri?

  This is, this is not bad though, as a branding thing. Um, all right. So here's, here's this story of the, the headline here is the $300 million butcher.

• 1:29Sam Parr?

  I'm in.

• 1:29Shaan Puri?

  This caught my attention because I didn't think a butcher could be worth hundreds of millions. But it's just a reminder that like, if you're the best at anything, money will never be a problem for you. You're the best plumber, money will never be a problem for you. It doesn't matter what you are. There's a guy in Dubai is just the best at trimming, uh, what's it called? Split ends that women have. And people will fly to this guy to get him to cut their split ends. You know, you're the best at anything, money will never be a problem. All right. So here's, here's the story. Back in the day, early 1900s, 1909, there's a guy named Anthony LaFrida. And he, he migrates from Italy and he comes to Brooklyn and he opens up a butcher shop. And he opens up a butcher shop and their idea is they don't want to just do hamburgers like everybody else.

• 2:11Shaan Puri?

  So the way a hamburger normally works, I think a hamburger and a hot dog, they're basically the worst parts of meat mashed together. So it's like not the premium cuts of, of meat that you could sell separately a steak. And they, uh, they mash it together. And that's what a burger was, is the scraps. And he said, we're going to use whole muscle cuts only. And he had this great line, which is, you can't hide your sins in the hamburger. And he viewed that that's what the other butchers would do is they would just take, hide the sins, is be all the bad parts smashed together. Hey, there you go. That's your hamburger. So that's the first LaFrida blend. And it was like, you know, parts of different parts of the muscle. So business is okay, normal butcher shop, 1950. New York butchers go on strike. And restaurants have no meat.

• 2:56Shaan Puri?

  And he decides to seize the day. So what does he do? He drives down to New Jersey. He goes and he buys up a bunch of the meat and wholesale. He brings it back, starts selling direct to restaurant. And they open up LaFrida meats in the meatpacking district. And it's going good, but now nothing spectacular. And in fact, the grandfather, then the father takes over the business. It's not growing. By the late eighties, things are getting bad. Restaurants are switching to Cisco, which is like the sort of Costco for restaurants of how you get food delivered. And the company's kind of dying. And so the son was never allowed to be in the business. This is Pat Jr. And the father was like, son, I want a better life for you. Don't, don't stay here. Go, go to college, get a good job. Don't be a butcher.

• 3:39Sam Parr?

  Don't be like me.

• 3:40Shaan Puri?

  Don't be like me. And he says specifically, he goes, why would you want to do this? You'll, you're going to be rubbing together pennies for the rest of your life. And so he's, he's forced out and Pat goes and he becomes a, he goes to a good school. And then he goes and becomes a stockbroker on Wall Street for nine months, but he hates it. And he just comes back, he begs his dad, let me be in the family business. And he petitions with the sister and I think the, the mom or the aunt or something like that. Like let Pat Jr. Into the business. And so the dad relents, he says, fine, if you really want to do it, do it. And so here's where we're at. This is now like 1994, not that long ago. I think like Lion King came out in 94. Okay. Like this is not like hundreds of years ago. And they had 44 customers. They had five employees, two drivers.

• 4:23Shaan Puri?

  The mom did the books and the dad and the grandpa were still the only two butchers. Okay. So that's when he took over the business. All right. So he's, he decides I'm gonna start reinvesting in the business like crazy. So he's buying new equipment. He's hits the streets of New York. He's just signing up restaurants. door to door, right? Because you know, sometimes when you have a really like product focused organization, the sales side just that muscle never got developed. And so he decides to hit the streets. And he has this genius idea to start creating branded labels for specific cuts and blends that nobody else was doing. And so he takes a bet on an unknown chef named Mario Batali. And Mario Batali was a nobody at the time, but he liked him and he desperately needed some veal loin.

• 5:04Shaan Puri?

  And he didn't have any money. And so Pat convinces the dad to give to sell this guy the meat on credit, something they'd never done. The dad was against it, but he's like, I just, I think this chef, he'll be good for it. I think we should support him. Let's do this. And Batali rewards this with loyalty. So for the rest of his career, they only buy La Frita. And as he's putting, as he, as Batali's reputation as a star New York chef grows, and he becomes a celebrity chef, he adds on the menu that he's not just serving meat, he's serving La Frita meats. And it helps him too, because it sounds like it's a more exclusive, premium, high quality product. And this was the key lesson that Pat Junior figured out, which was don't sell a commodity.

• 5:44Shaan Puri?

  Create a brand and create a brand, not just for him, but for each of the chefs, so that the chef had their own brand. So we would create custom exclusive blends for every of, every one of the hot restaurants in town. And so 50 restaurants got their own custom blend locked under an NDA that only they had. And this was kind of like a key growing thing for the business. Now, That is awesome. Somebody you might know becomes a fan, Danny Meyer. So Danny Meyer, who's got the upscale restaurant, Union Square Cafe, I think it is at the time. He's using La Frita and he says, hey, I got this idea for a more fast casual burger joint. It's going to be called Shake Shack. And can you give me like a burger for that?

• 6:25Shaan Puri?

  He's like, sure. And he goes, but here's the thing, like you got to make it where it's pre, pre formed patties. And because we're fast, we got to have that. And the, and the grandfather and the father were like, no, no, no, we don't do that. That's blasphemous. So the son secretly, secretly does this against the parents will. He had the sort of the right, the right amount of rebellion to pull this off. He knew what to keep sacred and he knew what to wear. Rebel and he does it and now he he serves all of Shake Shack's locations with his meat only.

• 6:53Sam Parr?

  No way.

• 6:54Shaan Puri?

  And he took his dad to the to the first Shake Shack and they see 200 people in line and he goes dad that's our burger. And he said, you know, this is a classic, you know, a son trying to make his dad proud of like, you know, we did it. Look at this. And they just kept doing these counterintuitive business moves. So 2008 financial crash happens in New York. It's, you know, blood is in the streets and everybody's hurting. He does a pretty counterintuitive thing.

• 7:20Shaan Puri?

  Hey, I want to tell you about something pretty cool. We have a database of all of the unsexy business ideas that have been discussed on this podcast. So hundreds of episodes, the team at HubSpot went through, they pulled out all the unsexy ideas. So not the super high tech ones, but the simple, relatable, interesting, profitable ideas that we have brainstormed. And they're all available for download for free. Just click the link in the description below. Thank you to our friends at HubSpot for sponsoring this podcast and putting together this free resource for you guys. Back to the show. There's a chef who asked him to create the ultimate burger and he says, all right, I'll give it to you. It'll be a 30% dry aged New York strip steak burger. But that black label burger, it's going to cost $28. It sounds insane, a $28 hamburger.

• 8:04Shaan Puri?

  But they said, let's do this. We want to have the best burger. And that as a marketing thing played well. Everybody thinks he's crazy, but they sell like 15,000 of the black label burgers. Versus they had a cheaper burger. It outsold the cheaper burger by 2X.

• 8:20Sam Parr?

  Which restaurant was this?

• 8:21Shaan Puri?

  This was Minetta Tavern, Minetta Tavern, something like that.

• 8:25Sam Parr?

  But I feel like I feel like I remember like headlines. This is always an easy headline, which is like, wait, it's a $40 bagel. What the hell?

• 8:32Shaan Puri?

  Yeah.

• 8:32Sam Parr?

  And they're like, well, let's, we should see.

• 8:34Shaan Puri?

  Is it worth the hype?

• 8:35Sam Parr?

  Yeah.

• 8:35Shaan Puri?

  You gotta know what makes this, this happened with strawberries. You know, these like Japanese strawberries, like a $50 basket of strawberries. And you're like, oh, I must know.

• 8:43Sam Parr?

  We should talk about that company sometime. It's killing. There's a company behind it that's doing really well.

• 8:47Shaan Puri?

  Yeah, by the way, I think it's, I think it's great. I think there needs to be more premium, like somebody who just says, I'm gonna make the best thing for people who aren't cost conscious. And I think there's always, there's always a market for that. So these guys did it. People would go to that restaurant, they would order it and share it as an appetizer, the burger. They'd like chop it into six and be like, this is amazing. We had to try it. So today, fast forward to today, the company does $270 million a year. They make like whatever, like they feed like 100,000 people a day or something with their, with their food. They bought their own facility and they're like, they have these huge, like the world's largest dry aging room. And their facility can hold $10 million of meat every night. It's like sitting in there like a Swiss bank account. They basically are just been scaling up, scaling up to the point where New York, I think designated them as,

• 9:32Shaan Puri?

  no, actually not even New York, a presidential mandate that they are an essential service, that they cannot close down. And so their essential food infrastructure at this point. And it's this lesson of like how you can take something that's just a commodity product and totally differentiate and build a multi-hundred million dollar business. That by the way, in the world of AI, seems like the place to be. I'd rather own this meat, meat business than, you know, tech businesses today. And so I just thought you'd get a kick out of that.

• 9:59Sam Parr?

  That's a great story. I'm looking at the guy, he seems like a guy who talks like this. Like, you know, with his hands. This looks awesome.

• 10:07Shaan Puri?

  I don't even know what that means. I don't think I've been to New York enough to understand. What is this?

• 10:11Sam Parr?

  You're like, hey, hey, what are you doing? This is my meat. You know, I don't know. This is awesome. We should like do like an in-person thing with this guy. And like go and like look at his, his meat packing setup. Cause this is really cool.

• 10:27Shaan Puri?

  Can we see and feel the meat?

• 10:30Sam Parr?

  This is really cool.

• 10:31Shaan Puri?

  I mean, this is, I think it's near where you're at, is in your head. I can't, I'm stunned. You don't know this name.

• 10:37Sam Parr?

  I'm not like a food guy, you know, like, like I like McDonald's, you know, I'll be fine going anywhere. It's all, it's all great to me. I always like have this joke that like when it comes to Mexican food, I'm like, it's all the same to me. It's either yes or no. And it's mostly like avocado and like beef. Like it's all the same. I don't know, man.

• 10:54Shaan Puri?

  It's either yes or no, and it's a yes.

• 10:56Sam Parr?

  Yeah, I don't have like, I don't have like a wonderful palate. But this is pretty cool. I also think that like there's a romantic feeling about these things that obviously is not fully true. Like it was not fun to do that when it was not going well. And now that things are going great, it's probably only fun part of the time. But I do think that there's something like soulful about things like this. Like you and I actually talked about this. Justin Mayers was, I think he's an investor or helping get going or advising a, Justin Mayers is like one of our health conscious friends who started a kettle and fire and he loves like these healthy things. And he talked about like Ace, he's like, I want to do a better butcher and he has one going in Austin, but it sounds like it's going great.

• 11:36Shaan Puri?

  He came on the pod and talked about it. I didn't know he, he launched one.

• 11:40Sam Parr?

  Yeah, the first location is down the street from my old house and there's a, it's a butcher there. I don't know how it's going, but I just know that there's a butcher there. But my point is, is that it's kind of cool. And there's actually been a lot of these large meat things. So for example, ButcherBox, the guy who started ButcherBox, he's pretty active on Twitter. It's a bootstrapped company that I believe is mid nine figures. I think like north of 500 or right around there, a million a year. And there's a bunch of really cool ones. There was a guy who joined Hampton that had, who had bootstrapped a hundred million dollar plus farm to like farm to the consumer's door butcher. And I think they're really awesome. And then Omaha Steaks, you know the story about Omaha Steaks?

• 12:16Shaan Puri?

  No.

• 12:17Sam Parr?

  Similar story where it had been around for a very long time, but they really took off because them and Stamps.com were one of the early, early, early innovators of internet marketing. And so Omaha Steaks, I believe is north of a billion dollars a year in revenue because they were one of the first people to advertise on Google.

• 12:35Shaan Puri?

  DTC, DTC Steaks, Steaks mailed to you?

• 12:39Sam Parr?

  Oh, you've never had one?

• 12:40Shaan Puri?

  A steak in the mail?

• 12:41Sam Parr?

  No, Omaha Steaks. It's like one of those, it's like one of those gifts that if you can't think of what to get your parents, you like give them an Omaha's like steaks gift?

• 12:48Shaan Puri?

  I don't think Indian people do that.

• 12:50Sam Parr?

  Yeah, there's maybe a cultural divide here.

• 12:57Shaan Puri?

  Yeah, that's a, that's a great call. It's like the Harry and David like gift basket. I think I've like defaulted to that many times just because it's like, I don't know.

• 13:03Sam Parr?

  That's what you gave me when I had my first kid.

• 13:05Shaan Puri?

  Who, who doesn't like huge pairs?

• 13:07Sam Parr?

  Yeah. Yeah. Or like edible arrangements. Yeah. I mean, it's just like, I don't know, it just works. And Omaha Steaks, they were one of the very first people to advertise on Google. And now if you listen to a lot of, like a lot of the early podcasts, do you remember early podcasts? It was like stamps.com, me undies, and then like Omaha Steaks. These were like the early advertisers. And at this point, the company, I think they're, they have this massive marketing operation and it's incredibly sophisticated. It's very, very fascinating to watch these guys grow.

• 13:35Shaan Puri?

  Maybe the best thing to do is just to. Follow Omaha Steaks and Stamps into what? Just go look at their revenue, their marketing mix, and then just go follow them because they just seem to find the new channel every single time. And literally just copying their playbook is better than hiring like a great CMO who's going to come up with their own playbook. It's sort of like, I remember when we were trying to do this sushi restaurant, we were looking at locations, we're trying to run like these analysis on population and foot traffic and, you know, the, how many business, how many high-income households are within two miles? And it was like, oh wait, Chipotle has a 300-person real estate team? Why don't we just go next to wherever there's a Chipotle? Like, they did all the work. And turns out, that's actually what, like, that's how Burger King chooses locations.

• 14:19Shaan Puri?

  They just go, if McDonald's does the research, they just go piggyback off McDonald's and go near there. And, you know, you could, you could sort of save yourself some breath.

• 14:28Sam Parr?

  My other takeaway from hearing stories like this, there's so many people who are just building amazing, amazing, amazing companies. They're not particularly in the mainstream, they're not vocal about it, and it's just fundamentally a pretty solid product and pretty solid marketing fundamentals. So for example, I just hung out with this, a friend of mine who works at a Element, Element Salts? You know, is that what it's called?

• 14:50Shaan Puri?

  Elemente, yeah.

• 14:51Sam Parr?

  Elemente.

• 14:52Shaan Puri?

  I don't know how you say, I think it is, I think you say Element, or I don't know if you say Elemente, but that's how it's spelled, L-M-N-T.

• 14:58Sam Parr?

  I remember seeing this business get started, like, it's only four or five years old. And I remember seeing it get started, and I'm like, this is silly. Like, who on earth is going to buy these like little packets of salt? It's basically electrolytes and salt. Well, they did a, like, they let their, their customers like invest in them. And so a lot of the financials are public. You can like see the numbers. I think it's close to $200 million a year in revenue. And they have a small team, like 30, 40, 50 people. And it's just like good fundamentals. Like, I was reading, the CEO puts these blog posts out on how he runs his company.

• 15:34Shaan Puri?

  Have you met him, James?

• 15:35Sam Parr?

  Is he awesome?

• 15:36Shaan Puri?

  Oh, great. He's, he's like one of my favorite, I've only met him once, he came to our basketball camp. I was, I literally loved this guy. He's so lovable. He's like, super thoughtful, super well-meaning, really smart, obviously, just like a killer, good basketball player also. He's just like a, he was so nice, so kind, so humble, and yet had built like not only this killer business, but other killer businesses too in their portfolio. He is, he is such a winner. I love that guy.

• 16:04Sam Parr?

  So I've only heard about it from my friend Esther. She was telling me what it was like working for him and she only said good things. And then I started researching him and there's all these cool blog posts where he like writes about how they do these things where they run the company by doing three week sprints, one week of planning. You know, most companies run off quarterly plans. He was like, no, we do three weeks where we go hard and then one week where we go a little bit easier and we could rest for a minute.

• 16:25Shaan Puri?

  By the way, that one week is really specific. It's three weeks like you're working like at an office or like you're online. And then the one week is everybody's in think, rest, reassess, plan mode, quietly by yourself, do whatever it takes for you to kind of step away. And he's basically shown that like that works really well for them, but like giving people time and space to think and plan. You can have a high performance team with that. It's not about just constant burnout of like pushing as hard as you can with no breaks whatsoever.

• 16:56Sam Parr?

  It sounds amazing and he has a blog post where he talks about like this process that he does, but he has all these other blog posts where my takeaway was like this guy's incredibly well intentioned or not well intentioned, thoughtful, uh, which I think you actually described him as. Uh, so it's funny that we came to the same conclusion. You hung out with him. I just read about him. Amazing entrepreneur and they don't seem mainstream in the sense of like in our little like silly marketing, like loud about it, online internet world, but they're just kind of building a amazing company that solves a real need. Customers seem to absolutely love. They have like all these weird like avatars. I think they have like a nurse's avatar. So there's like nurses who actually use their product and then they have like a military one and then like a construction worker one or something like that, you know, they have

• 17:41Sam Parr?

  like all these, and then of course like endurance athletes and all this amazing stuff. It sounds like an amazingly well-run company run by a guy who's not particularly loud, but is incredibly successful and thoughtful about running his business. This other guy named Jason Cohen, who I like, he had a blog post somewhat that wasn't entirely addressing this, but the phrasing is perfect and it was a bit similar called be king or be rich. And he was like, do you like, do you want to be rich? If you want to be rich, that there's like all these things that oftentimes the kings are unwilling to do. So the kings are oftentimes like the loud ones who raise all this money and do this or that. And then there's like the be rich, which is like bootstrap and just quietly do it for a long time. It's like ask yourself, do you want to be king or you want to be rich? Because they require different things.

• 18:21Shaan Puri?

  I think Naval has a funny one like that. He goes, if you want to be rich and famous, try getting rich first and just see if that does the trick.

• 18:27Sam Parr?

  That's so good.

• 18:31Shaan Puri?

  Hey, let's take a quick break. You know that feeling when strategy is done, the brief is written, everyone's aligned, and you realize someone still has to sit down and actually create all the content? That someone is usually you, and it's due tomorrow. Well, the Breeze Assistant from HubSpot can help. It works right inside HubSpot. You can draft a campaign copy, blog posts, emails, all in your brand voice, all using your actual customer data. So you don't create just content, you create content that converts. Check out hubspot.com, the agentic customer platform for growing businesses. Here's on that idea. So I saw this tweet today by this guy Renee Selman. He was talking about Nick Sleep. Do you know who Nick Sleep is? He's basically like a legendary value investor. He's kind of in the Warren Buffett, Charlie Munger lineage of investors. And I'll butcher the long story, but there's a

• 19:15Shaan Puri?

  the simple way to understand Nick Sleep is that he he crushed it so hard for like a very long, like for a period of time, made so much money for himself and his investors that just like was like, I think we're good, let's just like, basically just like shut down the fund. It was just like, like it's, we won. And they had won by just holding like a very small number of obvious sounding positions. It's not like he found some niche thing and not like he was super ahead of the curve. He owned Costco, he owned Amazon, and he owned like one other thing. He owned four stocks and he just held them. Is it Berkshire Hathaway? Was that the other one that he owned? I think, I think he had Berkshire, I don't remember what it was. He had four stocks like that were the core of his portfolio. It was super concentrated, but it was like four winners and they'd held it for a long time and that's all you needed to do.

• 20:00Shaan Puri?

  The game wasn't more complicated than that. And so he put this in one of his, and he has great letters to go read. It's like, you'll be a smarter investor if you go read the Nick Sleep letters. And so here's, here's one of his thing. It says, "Empty vessels and a quieter approach." So I'm going to read this. It goes, "Upon reflection, it is curious that this quiet attitude extends in its own way to the companies." So he's talking about his own quiet attitude, but he's like, "This actually extends to the companies we invested in, that we've entrusted your dollars. Amazon and Costco do not advertise. No shouting here. Berkshire Hathaway and Games Workshop do not provide earnings guidance, which is popular to give to fund managers and stockbrokers. Amazon, Costco, Air Asia, and Carpet Right, and parts of Berkshire, give back margin to the customer."

• 20:44Shaan Puri?

  And we would argue this is a pretty humble strategy, too. In other words, around two thirds of the portfolio is invested in firms that in some major way shun the commonplace promotional activity and yet they're no less successful as a result. So like Amazon and Costco, not advertising. Tesla famously does not spend any money in marketing.

• 21:01Sam Parr?

  Amazon is a huge advertiser.

• 21:03Shaan Puri?

  I think at this time, and they weren't, I don't know if they're doing like the Google performance advertising, but I think he's talking about like kind of brand advertising, anything like that. And then he talks about, Bezos has this quote, which is, "Advertising is the price you pay for having an unremarkable product or service." And he goes, "If you look at the," he goes, "On the other end of the spectrum is the razzle of General Motors." Now, this was written a long time ago, but he says, "Which has the largest advertising budget of any company whose annual report we read this year." And it went, that title went to GM, this, last year, the year before, and the year before. Their advertising spend was 5.3 billion in 2008, or $630 per car that they shipped. If you just took the advertising

• 21:45Shaan Puri?

  spend, it would have retired half of the company's debt. "It seems easier to call Madison Avenue than build cars that sold themselves. In our opinion, GM is very much the empty vessel making the most noise in that regard. Our portfolio takes a different approach." So I just thought it was interesting, like the idea of like people, but also companies that like, almost as a negative signal, which companies advertise the most? Like, I wonder if you actually like backtest that idea, how many of them actually have, you know, either worse performance to their peers, or they're like least durability, which is why they have to constantly be advertising, because they have a commodity product and they have the least durability in the market, or they have the least, the smallest mote, which forces them to continue to pay this tax.

• 22:27Sam Parr?

  Look, just to be a little devil's avocado on this one, I feel like Berkshire Hathaway's biggest company is GEICO, and they're like the biggest advertiser.

• 22:37Shaan Puri?

  Yeah, or Coca-Cola also.

• 22:39Sam Parr?

  So, I don't know. I mean, I think that this guy is significantly smarter than me, and significantly more successful than me. That said, I'm not racist, but that's like what that statement just was. I don't know, I feel like all, many of those companies are like huge advertisers, but I do think the sentiment is cool, and... One would say that like even though Tesla doesn't advertise advertise Elon Musk bought a $38 billion social media platform and I would say that that has benefited Tesla greatly.

• 23:16Shaan Puri?

  No, Ron, that was that's not that's not I don't think that's fair. I don't think he he didn't buy it for that nor I think has that if anything Tesla Tesla car sales have slowed down since he bought Twitter not.

• 23:26Sam Parr?

  I just think that like I just think that like there are a lot of outliers, of course, and maybe you could say Tesla is the outlier, but contrarians are often more often than not wrong. And if you look at some of the other best companies in the world like Apple, like they are or or, you know, many, most all actually, they are notoriously wonderful at advertising.

• 23:52Shaan Puri?

  Yeah, I don't think they don't advertise at all, but I think percentage wise matters. So for example, Elon has one mental model he calls the idiot index. And the idiot index basically is something he kind of figured out with Tesla and SpaceX as they bought parts from providers. Oh, we need this. We need this turbine. We need this this this valve. And basically, if the valve costs $5,000, it's like, well, that's the market price for the valve. We can't find anyone who's selling it for less than that. And what he would ask is basically, what is the cost of the raw ingredients on the London Metals Stock Exchange for the valve? And then what is the markup relative to the actual raw materials cost? And that's the idiot index. It's the price. It's the idiot tax you're

• 24:34Shaan Puri?

  paying because you don't know how to make the part yourself. And he found that the space industry had essentially the worst idiot index of all the industries that he had seen, where the idiot index was like, you know, 100x plus on almost every single part. And why he realized that he could do SpaceX without having a NASA level of funding was because NASA was buying things at the idiot prices and SpaceX didn't have to. And that he could bring the cost. How did he know he could bring the cost down so much? Was because he knew he saw how high the idiot index was. Tesla does the same thing. Another version of this was I was listening to Palmer Lucky from Anduril talk yesterday. And he was talking about the other defense contractors. You know, if you think about what Anduril did was pretty crazy. They went into like a space that no real modern tech company had gone into, defense.

• 25:19Shaan Puri?

  He was talking about, he goes, if you look at Lockheed Martin or, you know, these kind of other defense primes, the first thing is they all operate on the cost plus model. Cost plus model basically just says, cool, for me to win this contract, let's say it's a, whatever this contract is, $10 million or whatever, I'll bid $10 million because I'm saying that the, uh, the cost to do it is nine and I want to have, or, you know, let's call it $11 million, the cost to do it is 10 and I'm going to have a 10% markup. So he goes, guess what happens? Does that company have any incentive to find a lower cost way to do things? No, because they make 10%. In fact, the incentive is to, to say that everything is more expensive because if it costs 20 million and I got 10%, I would make 2 million instead of saying it's 10 million and making 10%, I make 1 million.

• 26:04Shaan Puri?

  Because it's a cost plus model. So I'm always just, whatever the cost is, I make a little bit on top. So the higher the cost, the better. Same thing with going faster. If I say I could do this in half the time, which is, you know, half the people cost or the labor cost, um, I have no incentive to go faster. So what's the result? The military is buying from, from providers whose entire incentive is to make everything cost way more and take way longer. And so he goes, the first slide on the Anduril pitch deck and our seed investment said, we are going to save the American taxpayer hundreds of billions of dollars a year and we are going to make hundreds of billions of dollars. And so he's like, that was the entire premise from day one. And he goes, I think that's exactly right. Because he would go and bid, he goes, we're not a cost plus model. We will, we will basically say, hey, we can get

• 26:47Shaan Puri?

  you this, we're going to sell products to the American government. So we're going to sell you the best product at the lowest price and we're going to try to get it to you the fastest. And that way we're like Amazon or Walmart, right? Or Costco. We're trying to give you the best product at lowest price and the fastest delivery. And our incentive is to do that. We get, we get, we win contracts the more we do that. And he goes, then you see that play out in the business. He goes, just look, if you don't believe me, go look at Lockheed Martin. They'll invest 1% of revenue in R and D. We've, we have invested 100% of revenues into R and D every single year of Anduril's existence. And people think, Palmer, how long are investors going to let you do that? Well, I don't know. I've, I've been able to do it for eight years or whatever it's been. And I think- I'll at least be able to do it for another five.

• 27:31Shaan Puri?

  He goes, Amazon was able to do the same. Amazon was able to convince investors that they should be able to invest this, all of their profits and more back into Amazon for like 20 years. And that's what gave them this incredible durable advantage and allowed them to take so much market share. That's what we're doing. So in some ways, I think it's pretty cool to almost look at like a simple heuristic, like the idiot index. Or like, what percentage of your revenue do you put in R and D? And it's like, I can't hear your words because the action speaks too loudly, is one way of looking at businesses.

• 28:01Sam Parr?

  I think that we've talked about like Eddie Murphy and he was like, I'm a great comedian because I'm extremely sensitive. If the valet takes my car and there's like the tiniest scratch, I'll notice it and I'm good enough that I can make a joke about it. And that's what makes comedians great is they're sensitive that they notice small moments and that's what's funny. And when I hear this story about Palmer, I don't really care about the, his business or the industry, but what I care about is his personality and his attributes. And it seems like there's this Venn diagram where you have to have all three. It's like the sensitivity to say that this is ridiculous and to like question, why is this the way it is?

• 28:43Sam Parr?

  Same thing with what you're talking about with Elon, the idiot tax, like that, that you have to be very sensitive to like notice these things. And then the other thing is you have to be audacious enough to actually think that you can fix that problem. And then there's this final circle, which is like logic. You like, these guys are really interesting at logic-ing their way into these problems where he'll say like, so this problem exists. And why shouldn't it be this other way? And there's this weird like through line of like how you can do something that seems logical when he maps it out on paper, but virtually 100% of all people are like, there is not a chance. That doesn't make sense. And it's like, well, no, it does. Like here's the math. Like, and it's very simple math that you would use to explain this stuff.

• 29:29Sam Parr?

  But you need to add in the audacity and then you need to add in the sensitivity to even recognize it in the first place. I admire those people greatly.

• 29:37Shaan Puri?

  So the three, audaciousness. Logic or first principles thinking? Yeah. Was the third one, sensitivity. Sensitivity. Well, he had said something that's kind of a combination of all three in this interview. So he said, he said two things I didn't know. One was that he was homeschooled. I don't know if you knew that. I didn't know that, that he was homeschooled. I think in general, I think homeschooling, one of the possible advantages I could suspect of homeschooling is that because you are out of the crowd, you are less likely to have heard, heard like thinking. And so, so I think that's, that's interesting already. And maybe there's some selection bias of the type of parents who would choose to homeschool might also raise you differently to think differently in many other ways, too. That's the first thing.

• 30:18Shaan Puri?

  Second is, he said his first job was using virtual reality, like light things for veterans. So it's kind of the combination of the two companies he built, Oculus and Andro. So he's like, I worked at this place where veterans were coming back with PTSD from war, and we were using a VR-like thing to help like mitigate their symptoms in some way. I thought that was interesting. I didn't know that either. The third thing he said was logic experiment. He goes, after I sold Oculus, yeah, I think at 19, he started or sold Oculus at 21. He basically sold it for two or three billion dollars to Facebook. And when he left Facebook, he basically left a place where he noticed that the smartest people

• 30:58Shaan Puri?

  in the world were all focused on increasing advertising revenue or, you know, basically getting you addicted to mindless entertainment. And he saw that Silicon Valley culturally had decided that war, defense, weapons was like taboo, bad, you're a bad guy, you're evil for doing it. And that was not the history of Silicon Valley that he had read about. That was not the approach that they had. And he talked about how certain companies, I forget, oh, like Bill Packard from Hewlett Packard. There was some story like how either he did a tour of duty with the government or like somebody said like, you know, this general and Bill Packard, they're basically the same guy. One, one guy's just doing it in business, but they have the same values. They have the same beliefs. And he's like, I just don't think that that was true over time in the tech world.

• 31:44Shaan Puri?

  And he said, is it a bad thing for America if all our smartest technologists and engineers go work on entertainment and advertising and refuse to work on defense?

• 31:56Shaan Puri?

  Uh, like that seems like a bad thing. How would we change that? Like, because he goes, other countries aren't gonna do that. Like, other countries are not gonna have their most brilliant minds not working on these things. And if they have their most brilliant minds working on weapon systems and we do not, like, doesn't really matter how much money or clout you have, like, that's not gonna end well. At some point, the slope of their line will cross over the lead that we have. And it's that kind of like simplistic, big picture, zoom out sensitivity thing you're talking about? Then multiply, you know, plus the logic, then multiplied by the audaciousness to go do something about it. All right, like, that's kind of what you're talking about. It's like this formidable triangle that gets created.

• 32:34Sam Parr?

  And it's sort of like this thing where sometimes hard things are easier than easy things. Because when you have this grand mission, um, it like makes it where you can work harder and you could inspire people and you could recruit better, better, the best talent for less pay when you can't afford it at the time. There's this book that I just started reading last night about the, um, Manhattan Project, the creation of the atomic bomb. And they're like, ah, I'm creating violence, that's not good. But Hitler's doing it and we need it before him. And it created this sense of like excitement in a weird way. I don't know what, what better word to describe it, where they're

• 33:16Shaan Puri?

  Purpose.

• 33:16Sam Parr?

  Purpose, duty, a sense of duty. Where they were able to wrangle up all the best scientists and get them to quit what they were doing, which was their dream jobs of teaching math at Berkeley. And like, they were happy. They got them to move to New Mexico for a year or two. And they worked like crazy and they invented things. Like, in this book, they explain how splitting an atom works and it's just impossible for me to understand. But it's like, that is just some crazy stuff to invent in a very short amount of time. But there was this sense of duty and I kept thinking, these big meaty problems in a weird way seem easier or more exciting to go after than some of the small meeting, small problems that might be significantly more lucrative. But in reality, the first one can be way more lucrative.

• 34:01Sam Parr?

  And so it's kind of like the best of all worlds, but there's like this, this seems hard. This seems impossible. I don't want to do that. You know what I mean?

• 34:07Shaan Puri?

  Have you seen The Imitation Game? The movie The Imitation Game?

• 34:09Sam Parr?

  Is that with the touring? Is that touring?

• 34:12Shaan Puri?

  Yeah. It kind of has the same thing, right? It's like, uh, during the world war. Germany's kind of blitzkrieging and bombing and, you know, the UK. And they basically hatched this secret project to try to crack the German Enigma machine, to be able to crack their correspondence. And Alan Turing and a small group of like brilliant people figured out how to decode the messages, how to decrypt, I should say, the messages so that they could understand. But then they couldn't, so it was like this huge, this kind of impossible thing. How do we, how do we break the Enigma machine? This encryption that we can't break right now.

• 34:49Sam Parr?

  Basically, for the listener, a machine that the Germans were using to relay messages to one another, and the British wanted to crack the code so they could figure out where the Germans are gonna go.

• 34:59Shaan Puri?

  Where are their ships? Where are they gonna attack? Where are they? How are they doing this? What's the decoy? What's real? You know, like, where is the, where is their leadership right now? All those things. And so they want, they couldn't do it. So they basically, it's like, you get the brightest minds, you take them out of universities and businesses, and you say, look, it's your duty. Like, every day that we don't crack this, you know, your friends and family are at risk of dying, basically. And we could lose this war to, you know, this bad guy. And so they worked, you know, for a couple of years to crack this thing. They cracked it, and that was extremely helpful at like swinging the tide towards defeating Germany. And, um, and I, it was just like, these like, the movie's great, right? It's entertaining in that way because it's like a very romantic idea of like the brilliant minds secretly conspiring.

• 35:43Shaan Puri?

  And then they couldn't tell anyone either. They couldn't even tell anyone that it existed. Once they cracked it, they couldn't show how much they knew. So they had to, like, this is part of one of like the moral dilemmas. I don't know how real this was, but in the movie, they're basically like, they know, they cracked the thing, they know when an attack is happening. But it's like, if we, if we prevent that attack on that civilian boat, they'll know. How the hell did we know that was coming? They'll know this, they'll, they'll just change the encryption. So we're gonna have to be really selective about where we use our knowledge of this. And I just thought, oh, that's like another layer of game theory on top of this whole thing.

• 36:16Sam Parr?

  When I was 24, I took a cross-country motorcycle trip for six weeks. I traveled the country on a motorcycle. And I had this distinct feeling when I got back where many of the things that I thought were normal, or like the routines that I was in before that trip, were broken because I did a lot of camping and I met a lot of different people from all walks of life. And I've noticed that whenever I travel, I don't know if you've noticed this, but whenever I travel particularly to another country, I come back with more perspective, not in the like woo-woo way, but like I seek frame-breaking moments and it's significantly easier to find those moments when you're out of the country and a place that's, and this is why I want to go to Japan so badly. I want to see like all the weird stuff.

• 37:01Shaan Puri?

  I was literally thinking about Japan.

• 37:02Sam Parr?

  I want to see all the weird stuff they do because I want to be inspired. We had Kevin Ryan on the podcast. He's one of my favorite entrepreneurs and he said that either him or that one of his co-founders was originally inspired to start Gilt, which was like, was it like an auction, luxury auction?

• 37:19Shaan Puri?

  Yeah.

• 37:20Sam Parr?

  But they had like this weird mechanism where they like made people wait in line. I forget exactly how it worked, but he was like, I went to France and I saw this and I'm like, we should just do that in America. And that's a very simplistic way to, a really simple example, but I've noticed that whenever I travel, I come back with that feeling of where I ask myself, why am I living this way? And to bring it back to Palmer, I think that is what makes people the greats really special is they're able to be sensitive enough to find these small insights and they're open to having their opinions changed.

• 37:53Shaan Puri?

  Right. I'm totally with you on that. I think Coinbase kind of started for this reason, by the way. I think Brian Armstrong went down to Argentina and was just working out of Argentina. And if you've ever been to Argentina, it's a, the local currency has been like hyperinflated away. If you have, if you have dollars, it's not only just the normal increased purchasing power of the dollar, then there's something called the blue dollar, which is basically like, there's a blue dollar rate. So it's like, it's like 2X what the actual dollar rate is because they're that desperate to have dollars. So your dollar just goes so far there. And you know, if you see something like that, it's a frame breaker because you know, if you're here, you just take it for granted. Money is essentially like, it's like a fish in water. You don't even see it. You just assume a dollar's a dollar. And you know, we now have the 2%, 3% inflation. People get it, but

• 38:38Shaan Puri?

  it's over such a long time period. If you go to a place that's inflating 20% a year. You realize very quickly like, oh, wow. These people need a different solution. And then you hear, then you connect the dots when you hear about something like Bitcoin, which is mathematically impossible to inflate as a currency system, as a saving system. You could see why that might be really valuable to people because of your Argentina experience. And so there's so many examples of this, you know, all around the world. I'm, I'm with you. In fact, I think that's the one thing I miss the most since having kids is that my travel has dramatically slowed down and has safened up.

• 39:15Sam Parr?

  I'm like convincing myself that we have to go travel. I have to go travel. We gotta get.

• 39:18Shaan Puri?

  Yeah.

• 39:19Sam Parr?

  It's like one of these things that like, it's sometimes a pain in the ass to do.

• 39:22Shaan Puri?

  And then I look at my two-year-old, I'm like, I guess we'll just go to the resorts. It's gonna be pretty tough to, am I really gonna, am I really gonna adventure out there right now? Let's see.

• 39:30Sam Parr?

  Yeah.

• 39:31Shaan Puri?

  Maybe a few more years. Maybe I'll stay in my frame for a few years.

• 39:35Sam Parr?

  This is for the folks out there who have a business that does at least $3 million a year in revenue, because around this point, that's when you're able to look up after being heads down for years, building your company, and you realize two things. One, you've done something great, but you're still a long way from your final destination. And two, you look around and you realize, I am all alone. I've outrun my peers, which means you're now making $10 million decisions alone, by yourself. And that is when mediocrity can creep in. My company Hampton, we solved this problem by giving a room of vetted peers, of other entrepreneurs who are gonna hold you accountable, call you out on your nonsense, and help show you the way. Because the fact is, is that there's only a tiny number of people in your town who know what you're going through and who have been there.

• 40:20Sam Parr?

  And they're hard to find. And if you can find them, it's hard to have this explicit time, this explicit place where you sit down, where the rules are clear that we are here to help each other and to be one another's board of directors. The biggest risk is not failing. You have a company and it's working, you're gonna be fine. But the biggest risk is waking up 10 years from now and saying, shit, I barely grew in business and in life. And for people like you who are ambitious, wasted potential, and regret is what we want to help you to avoid. We have made so many of these groups and we have 1,000-plus members. And I know this stuff actually works, whether you work with Hampton or you get your own group on your own. But having a group like this, a group of people who you meet with in real life, once a month, it can change your life. It changed mine, and I know it will change yours. So check it out, joinhampton.com.

• 41:07Sam Parr?

  I did something the other day that I want to tell you about. Got a babysitter, went out with my wife on like a Thursday. It was a big deal and we went to this thing called the Webby Awards. Have you ever heard of the Webby Awards?

• 41:16Shaan Puri?

  Well, as a one-time Webby Award winner, yeah, you know, we, we know about the Webby Awards.

• 41:21Sam Parr?

  We do know.

• 41:22Shaan Puri?

  Origin story, though. It's, it's basically the Oscars for internet nerds minus all of the prestige.

• 41:28Sam Parr?

  I have a love-hate relationship with the Webby Awards because it was actually quite fun, but it's a, it's a circle jerk. But the business behind it is kind of cool and I think there's a lot of opportunity here. And I, and I think you, you would dig this. So basically it started in 1994 as a website called the cool site of the day. The internet had just started. I don't know how many users there were on the internet, but potentially only hundreds of thousands. And there was a website dedicated to showing off the cool websites every single day. And it was almost like dig or Reddit, but like one website. And this lady had this idea where she was like, we should turn the website of the day, the cool website of the day into an award show. And the first Webby Awards, I think it was in 1996.

• 42:12Sam Parr?

  And so the early Webby's was actually quite cool. They called it the Oscars of the internet and it was total nerd stuff. So check this out. I want you to see this video. So they played this montage video when I went to this award show. And it was so cool because it was like internet history.

• 42:29Shaan Puri?

  First shot, the founders of Google, Larry and Sergey, wearing giant foil capes. And it looks like they're rollerblading. I can't see their feet, but they're gliding on the stage. They said, he said, they said a hundred million times a day and then searches a day. And then he goes, do you get a penny every time they search? And he goes, I wish. Turns out that wish came, wishes do come true. He got a lot more than a penny. Hollywood has the Oscars, TV has the Emmys, the internet has the Webby's. Okay. So you're, you're back in on the Webby's because they gave you free food. Go on.

• 43:01Sam Parr?

  Three to six cents per search. So good job, guys.

• 43:04Shaan Puri?

  They make three to six cents per search?

• 43:08Sam Parr?

  That's insane.

• 43:08Shaan Puri?

  That sounds too high. That sounds crazy.

• 43:10Sam Parr?

  Uh, okay. So Webby Awards, it was ba-, it was really cool early on because it was internet culture. This was when Google was a company that was still almost like a nerdy project. It was awesome because there was like Kim Kardashian before she was like super famous. And she was famous for like, uh, she said, I think it was like. Nude photo of the year, like they had like goofy categories. Like, do you remember when Will Ferrell did E-Bombs World where he did like the Angry Landlord?

• 43:41Shaan Puri?

  Yeah.

• 43:42Sam Parr?

  It was awesome. It was like nerdy stuff, but it carried over into pop culture. Like when the Foo Fighters were like really famous, they were there, David Bowie was there. It was awesome. And it was so cool. And the, when I went there the other day, it was also awesome because the famous thing is every single speech can only be five words. Some of the people who won the awards were like a lot of like Instagram stuff that you see online, like nerdy niche shows. But it's a total pay for play scam. So in order to get into the webbies, they have something like 1300, or sorry, 13,000 entries per year. And it costs like six or $700 in order just to enter. And they have so many categories that they have a blog post on it called how to pick the right category. Or like how to find your category.

• 44:27Sam Parr?

  And at this point, the reason I didn't want to like it, even though it was quite fun, is because it's a-

• 44:32Shaan Puri?

  So when you went, was it like pageantry? Like were you blown away by the production? Or was it kind of like bootleg? Like what was the-

• 44:38Sam Parr?

  No, it was awesome.

• 44:40Shaan Puri?

  These, these hosts of yours, but-

• 44:42Sam Parr?

  No, it was great. There was a red carpet and everyone was taking photos and like everyone dressed nice. My wife and I, you know, we dressed like as if we-

• 44:49Shaan Puri?

  Were you famous? Were you famous there?

• 44:51Sam Parr?

  I was quite popular there, yes. Yeah, it was, there was like actual famous people, like for example, the big award went to, is it Druski? You know, Druski or is it Druski?

• 45:02Shaan Puri?

  Druski, I think, yeah.

• 45:03Sam Parr?

  And Jack Harlow like gave him the award. So there was some like proper famous people there. But you know, I, I was a favorite because we're a business podcast. And so a lot of these influencers who are way more famous, they actually listen to us sometimes because they want to get like business content. But the company's crazy because it's been around for 30 years. It's now owned by private equity, which is hilarious because the bulk of the people there, it was a very Brooklyn hipstery, like woke people.

• 45:29Shaan Puri?

  Right.

• 45:29Sam Parr?

  And if I started like researching where the Webby's is based, it's based out of Kentucky. So it was bought by a PE firm and now the headquarters are in Kentucky. So it's not even like this, like necessarily like cool internet-y Brooklynite business, but that's what everyone there, that's what they were. I think that someone can start a cool back to indie award show that is properly the Oscars of the nerd internet. Like, I don't think that Twitter's mainstream enough, but that might work where you could have like nerdy Twitter stuff. But I went to this other one, coincidentally, called Strip Mall Trent. You know who Strip Mall Trent is?

• 46:09Shaan Puri?

  Yeah.

• 46:09Sam Parr?

  He has a gala, which is hilarious. So it was a black tie gala and it's just all of his Twitter real estate friends. So it's just like real estate Twitter has an event. And it was awesome because it was all these guys who I'm friends with on the internet, but I never actually see. They were all there. It was amazing. But I do think that a proper indie Oscars of the internet type of stuff, like the nerdiest stuff, start extra small would be epic, would be so cool.

• 46:34Shaan Puri?

  This model, this business model of basically create the award, create the event, create the list, I call it the kingmaker move.

• 46:43Sam Parr?

  Yeah.

• 46:43Shaan Puri?

  So you, you basically can go into any industry, any social circle, and simply by making the winner's list, by making the awards, by making the list, you can insert yourself at the center of any network or any market. Actually, Jason Calhoun did this back in the day in New York. And I think he's talked about how, I remember hearing this like 15 years ago, he was explaining this, he goes, "I was in New York and I was, you know, nobody was reading our publication and nobody knew me, but I knew I wanted to be in the tech scene in New York." And so what he created was the Silicon Alley 100, which was going to be the 100 power players of tech in New York.

• 47:22Sam Parr?

  Which at the time was a small, a small group.

• 47:25Shaan Puri?

  Which was a smaller market back in the, it was like in the 90s, I think, or maybe early 2000s. Specifically, what he did was, let's say, everybody knew that Arianna Huffington, in the Huffington Post, was like, you know, she was like this power player. And, but he wouldn't put her one, he put her at four. And so immediately, she's like, what? Who are the three people that beat me? Because if she got named one, it's kind of like, oh, whatever. But if she got named four, she's like, I gotta know, who were the three that were above me? And it created controversy. And he's like, I intentionally would place people at certain parts of the list to maximize the controversy and the word of mouth with which this thing would spread. And he goes, and it worked. They would call me immediately, and they would want to know who we are, what we're doing, and all this traffic came to the site. Because when you win, you share, because it's good for you to win.

• 48:10Shaan Puri?

  And when you lose, it kind of pisses you off, and you want to figure out, who are these people? And like, why don't I have status in their mind? And you kind of like, you become in their, on their radar where you weren't before. And I thought, wow, that's pretty smart. And I've since then, seen this done many, many times over in different, different ways and different spaces. And I think, actually, you could do this really in any industry. I'll give you one other example. My brother-in-law, he's based in Vegas, and he does real estate. He's come on the podcast once before. I told him, you know, he doesn't like, ever go out pitching like, investors or whatever. But like, because his returns are really high, he's, you know, probably had like, I don't know, couple hundred million of investor capital put into his deals now. But he never picks up the phone, he never does any networking events.

• 48:52Shaan Puri?

  And I was like, dude, why don't you just create the Vegas 100? And he goes, what is that? And I go, basically decide to throw a one black tie gala, kind of like what you're saying the real estate Trent guy did. And just honor, give awards out to the 100 most influential business people in Las Vegas. And you invite them, you let them know they've been, they, they won this award, and that they are one of the most influential people in Las Vegas, as deemed by you, random person. And you rent out this car dealership, because you already have really fancy cars there, and that's just, it already adds to like, the luxury aesthetic of Vegas being really flashy. I was like, just rent out your buddy's car dealership, host it there, cars on the floor. And then, at the dinner, you're going to network with everybody, because you're the host. Everybody has to meet the host.

• 49:37Shaan Puri?

  And those will become investors for you. You'll never have to go on a roadshow, because you can get everybody to come to you if you, if you create a honeypot like this.

• 49:44Sam Parr?

  I think it's awesome and I do have to add an asterisk. So I did go to the Trent's Black Tie Gala. It was amazing and I saw a bunch of friends, but I have a rule that I don't go above 50 floors in a building and I got to the lobby of the event and you had to get into this elevator to go to the 100th floor on the top of the Hudson Yards and I had my black tie shit on that I rented and I found out it was on the 100th floor and I said, "Not for me, guys. Have a good night." And I only stayed for half an hour and I went home.

• 50:18Sam Parr?

  Dude, I'm not going to the 100th floor. Are you kidding me?

• 50:21Shaan Puri?

  What do you think's changing at floor 49?

• 50:24Sam Parr?

  It's just not for me.

• 50:25Shaan Puri?

  You think you can make that jump? What do you think's happening?

• 50:28Sam Parr?

  Going to weddings that are more than an hour away and going above floor 50, not for me. Not for me. I just have a rule that I live by. I was all the way there. Not for me.

• 50:38Shaan Puri?

  You're a man of principle. I actually appreciate that you live by such a code. I don't know if there's really any rule that I live by as much as you do.

• 50:44Sam Parr?

  Oh, yeah. I got there and I was like, you know, so I went to the bar and got like a glass of water to calm down. I was like, can I? And I went to the tenant of the elevator. I was like, "How long is the elevator up?" And he's like, "About a minute." And I was like,

• 50:57Sam Parr?

  "I don't think so, guys. Have a good night. I hope the gala's great. It was nice seeing you in the lobby."

• 51:03Shaan Puri?

  So you just like went to a bodega in a black tie?

• 51:05Sam Parr?

  Yeah, just went home. And my wife was like, "What are you doing home already?" I was like, "It was on the 100th floor." And she was like, "Ah, get it." Have you heard of, dude, some of these could be big businesses, by the way. There's Institutional Investor, which is like a magazine and they rank the best investors and it's like a $200 million business.

• 51:22Shaan Puri?

  Is that the Midas list or Midas is separate?

• 51:24Sam Parr?

  Separate. Institutional Investor, it's like a super niche publication for institutional investors, people who raise money from institutions. And we talked about J.D. Power. You know J.D. Power?

• 51:34Shaan Puri?

  And their associates?

• 51:36Sam Parr?

  This is why it's funny.

• 51:37Shaan Puri?

  Who is J.D. Power and who are these associates?

• 51:39Sam Parr?

  I think is, what was his real name? James David Power. That was his real name. And the associates was his wife and kids. He started the business in 1969. And he went to Wharton. He was a really smart guy. And then I think he worked at Ford in advertising and he had this like brilliant insight, which is like, No one actually speaks on behalf of the customers. I don't think Ford, I don't think they're asking the customers if they're truly happy with their purchase. And so he gets this idea to go and survey a bunch of customers to figure out what they liked and didn't like about Ford and a variety of other cars that they purchased. And he went and sold the research to the car companies, which at the time in 1969, there weren't that many car companies. And eventually he gets the ideas like, let's create an award. And so he creates an award called the JD Power Award.

• 52:23Sam Parr?

  And this is like 10 years later and he starts giving out these awards. And the people who he sells research to was like, I'm angry. Why am I not higher up on the list? And he was like, well, for an extra fee, I can teach you how to improve X, Y, and Z to so you can get higher in the list. And that was the JD Power Award. And then like 20 years into it, he creates the trophy. Everyone knows like the trophy. It's like this weird.

• 52:45Shaan Puri?

  No, I haven't seen it. It's like a Stanley Cup. Oh, it's like this little arch.

• 52:49Sam Parr?

  Yeah, I guess maybe.

• 52:50Shaan Puri?

  Who knows this? Nobody knows this.

• 52:52Sam Parr?

  You see that when they show the commercial, they show like ranked best in safety by JD Power. And they like show that little emblem and that's when things really took off. And he ends up selling the company to McGraw Hill for like $500 million and then they sell it a few years later for a billion dollars. And now it makes, I think, over a billion dollars. And it ranks and does these awards. And what they do is they have all these different categories so they can continually give awards to a variety of car companies and people pay for their research. And I was thinking this can work across a variety of categories where there's something where you need to do a lot of research in order to buy what's necessary and where you can license the award to the company and they can use it to attract more revenue.

• 53:34Sam Parr?

  For example, a really niche idea would be like old people homes, senior living. It's like a $10,000 or $20,000 a month decision and

• 53:42Shaan Puri?

  Right.

• 53:43Sam Parr?

  It's like a huge decision and you want to research the best one. I do think that you could have these like award, this award business, this research business for a variety of categories. And it's quite interesting to me.

• 53:52Shaan Puri?

  If anybody wants to do these, like you create the award, you create the list and then you piggyback an event off of it. Hit me up because I have two specific ideas I want to actually bring to life that are like this. I'll give one of them out and I'll save the other one. The one that I'll give out, Sam, have you noticed that probably more than ever, there are teenagers?

• 54:15Shaan Puri?

  Yeah, people who are 12 to 20 years old that are just doing amazing things, doing stuff that like, you know, we're just picking boogers when we were teens compared to them. Even now we're picking boogers.

• 54:27Sam Parr?

  The average teen nowadays does seem way further ahead of where you and I were.

• 54:34Shaan Puri?

  Well, maybe not even the average. Maybe it's just the outliers because the outliers have the internet to show that they're outliers. I think the outliers kind of always existed, but there's two things.

• 54:42Sam Parr?

  It seems like there's more. There's more, it seems.

• 54:44Shaan Puri?

  Seems like there's more. I think because they're visible. I mean, back before the internet, how would you even know? And then secondly, I think they got inspired, like they got access to better information. So they're growing up mentored essentially by Elon Musk and Naval and Mark Andreessen. They have access to the best knowledge, the best founders. They see what the Carlson Brothers do. And so there's a almost like Roger Bannister four-minute mile type of thing going on where the really smart people see what other really awesome people do. And it breaks their frame of what they thought was possible for themselves and then they do more. But here's a weird thing, like Sam, do you think those, the people I'm talking about, the ones who create like they invent things, they create world-changing companies. They're hackers. They're, you know, they're, they're just really, really brilliant in ways that are important in the business and tech world, let's say.

• 55:30Shaan Puri?

  What do you think that person looks like when they are a teenager? Do you think they're on the honor roll, taking six AP classes with high SAT scores and class president? Or do you think that they look a little bit different?

• 55:42Sam Parr?

  Well, the second one, obviously, yeah.

• 55:45Shaan Puri?

  And so because they look different, where do they show up, right? So because, you know, how, what do you think might be signals of somebody who is brilliant? They have this kind of like Sean and Sam would want to invest in them. We'd be tripping over ourselves to invest in them because we just know that this person's a winner. What do you think we would be the signals that we would care about?

• 56:06Sam Parr?

  We would see them on the internet or if like they have like a weird hobby, like they're the best video gamer or something like that. You would like catch little bits like that.

• 56:16Shaan Puri?

  They're great at something that's competitive and nerdy, but not necessarily business. That's a good signal. They might be like running a like a some weird like sneaker flipping franchise or empire.

• 56:28Sam Parr?

  Like a power washing thing.

• 56:30Shaan Puri?

  The Grand Theft Auto skins or some shit like that. And they're making a lot of money doing something that we're just like, what? You, you own Instagram handles?

• 56:37Sam Parr?

  Or like you sell Minecraft like props.

• 56:39Shaan Puri?

  Yeah, whatever that is. A third would be really hardcore in math and science. So math Olympiad, science, you know, doing, you know, actually like writing papers that are published in nature, like doing some weird shit like that, that like the average teen shouldn't have specialized in that way.

• 56:56Sam Parr?

  Yeah, like being, being passionate and world-class at things that don't matter, that actually in itself, it does matter.

• 57:04Shaan Puri?

  Being passionate and obsessed with things that are specifically low status when you're a teenager. Like you get, you get bullied, you get a wedgie for doing this, you know, you don't get status points for doing this in school. So I think that it would be really interesting to find a hundred kind of of these like hacker kid, outcast misfits. Go find the number one Yu-Gi-Oh player in the, in the world. Go find the kid who's like, figured out how to hack Google Maps, or like he hacked his Tesla. And you're like, what? And he's like, yeah, I kind of got a slap on the wrist for it, but like it was fun. And you go find these kids, you bring them together and you let them know two things. One, I see you. Everybody likes to be seen, I've learned. And the second thing is, hey,

• 57:46Shaan Puri?

  the set of skills you're, you have right now that is not really celebrated by parents and teachers, or other kids in your, your thing, we celebrate it. And legit people that you admire, like go get, you know, the kind of, the founders of Reddit and Airbnb and all these things to come to this event, and give these kids like time, attention, mentorship, like, you know, their flowers and be like, yeah, I used to do that when I was a kid too. So you could be like me. And let them know, if they ever shift that laser beam from doing dumb stuff, to doing like something that might create some value, you could be, you know, you could be here and create a network of those people. So I really want to create this.

• 58:19Sam Parr?

  That's cool.

• 58:19Shaan Puri?

  It just needs a name, a brand. I have the network to pull it off, and the money to pull it off. I just need somebody who's got the energy to come like build this brand and then host the event with me. I think it'd be amazing to, you know, corral these folks all around the world.

• 58:32Sam Parr?

  The Ernst and Youngs of the world, like these huge mega corporations that are kind of like dorky. They would be just chomping at the bit to sponsor things like this.

• 58:41Shaan Puri?

  And we would reject them to only raise our profile as being cool. Just imagine there's some kid in the Philippines who's like, you know, playing around with like, whatever, lasers and he's figured out how to laser, laser etch something. You're like, I don't know what that means. But and then there's another kid in the Ukraine who's doing something. And then there's this whiz in Canada who's just like the number one Starcraft player. He kills all the, all the, the Koreans' Starcraft servers. He's just dominating. Who are these kids? We gotta know who they are. If you identify them in that golden window, that like 11 to 19 year old window, you can actually be such a meaningful like trajectory raiser for them. You can, you can actually shift the course of their life just by giving them, A, a network of other weirdos like them at the, at that level, I think would be amazing.

• 59:24Sam Parr?

  That's pretty cool. I, um, do you remember how I started that website, Sam's List? It was like a ranking for accountants. I, uh, I gave the webs, I gave it to this woman named Kimmy. So she's the, the majority owner and it'll do like maybe 500,000 in revenue this year.

• 59:40Shaan Puri?

  Explain what it was for people who don't know.

• 59:42Sam Parr?

  So about three years ago, I needed an accountant and I tweeted out, who has a good accountant? And I got probably 300 replies and I was like, this would be a lot to go through. I still don't know who's good. And I was like, you know, this would be interesting. What if I called all 300 of them and I aggregated the results? So for example, what services they specialize in, how much they charge? And what if I could even get reviews on them? And so I ended up calling like 30 of them. And I was like, this is, this is interesting. I know how much each person charges and if they're right for me or not, but I don't want to go through the rest of them. This is too much work. So I tweeted out, who wants this website? I don't want this, but this seems like it could be cool.

• 1:00:22Sam Parr?

  And so this woman, Kimmy, replied and she took it over and she not only went through, I think all 200 or 300 of them, but she convinced them to send the website to their clients and they would give reviews. And the way that the business model works, I think it needs a little bit of tinkering because accountants or CPAs, they're not exactly the best salespeople. And so for example, she's had problems where like, She's like, hey, you know, these five people just inquired to use your service and they haven't heard back from you. And they're like, well, I emailed them one time and they didn't reply. And she's like, dude, you gotta like follow up many times, like things get lost and things like that. And then all these financial planners, whatever, they they're more like these alpha

• 1:01:03Sam Parr?

  sales bros, because unlike an accountant, you can have tons and tons and tons of clients, because you don't really service them like to the same amount of quantity, or the same amount of work, and you get fees. So the business model is far better. And they're like clamoring to like, use this website. And I'm telling her, after this podcast, I'm like, you should host an award show for accountants, and also you should offer the service to financial planners. But she's done a good job. She has a bunch of followers on TikTok now, where she interviews like these accountants, who are nerds, but they kind of do it in an interesting way. And so she's like, actually gotten this following of like nerdy accountants and people who want an accountant, an accountant. So it's kind of cool. But I think she can do an award show, too.

• 1:01:43Shaan Puri?

  Yeah, that's a, that's an interesting one. Well, I don't know, award show, but like some, some sort of like recognition. Doesn't EY do like Entrepreneur of the Year, like some insane?

• 1:01:52Sam Parr?

  But there's like hundreds of them.

• 1:01:54Shaan Puri?

  But it's like, there's, there's thousands of them. There's literally like.

• 1:01:59Sam Parr?

  And whenever I think about this, I'm like, wouldn't the?

• 1:02:01Shaan Puri?

  Like, here's the event for the non winners, because there's too many winners. We did the event for the people who didn't win. Because they do it like, every city has multiple per every industry and every size of business. So it's like, congratulations, you are the Houston, Texas, best oil and gas midsize company, you know, award.

• 1:02:20Sam Parr?

  Well, that's why I got mad at the Webby's. They gave like, the awards to all these people I've never even heard of. I'm like, wouldn't the podcast of the year just go to like Joe Rogan, or Theo Von, or like, just Call Her Daddy? Like, but it didn't, that didn't fit the narrative. I love this type of shit. I love talking about this stuff. This like, esoteric weird stuff. So this is cool. That was a good episode.

• 1:02:40Shaan Puri?

  How have we had like, a thousand hours of conversation with each other? And it's still just as good as the first, my friend. That's unbelievable.

• 1:02:47Sam Parr?

  When we were on episode 20, or 30, or 50, or something, Andrew Wilkerson messaged me, and I think he messaged us in a group chat. And he was like, aren't you worried that you're gonna get nervous? Or aren't you nervous that you're gonna run out of stuff to talk about? And we were like, kinda, but I guess we'll approach that when we get there. And thankfully, it hasn't happened yet.

• 1:03:08Sam Parr?

  All right. Is that it? That's the pod.

• 1:03:21Shaan Puri?

  All right, let's take a quick break to talk about a podcast. Because if you're listening to this, you like podcasts. And what's better than one podcast? Another podcast. And let me tell you, another podcast you should check out. It's called Success Story. If you like hearing about different success stories and hearing Q and A sessions with successful business leaders, or hearing keynote presentations, or just checking out conversations about sales and business and marketing tactics, this is a great podcast for you. So check it out wherever you get your podcasts.