Marc Lore — founder of Diapers.com (sold to Amazon for ~$550M) and Jet.com (sold to Walmart for $3.5B) — joins Sam and Shaan to discuss his “Vision, Capital, People” framework for building big companies fast. He shares his rigorous hiring philosophy (the SPOTTAKE acronym, resume pattern-matching for top performers), his contrarian bet-big-early approach to fundraising, and his favorite emerging opportunities in conversational commerce, virtual apparel fitting, mobile kitchens, flying cars, and personal health dashboards. Sam and Shaan close with a lengthy debrief unpacking Marc’s key insights.
Speakers: Marc Lore (guest, founder of Diapers.com, Jet.com), Sam Parr (host), Shaan Puri (host)
Intro and Guest Overview [00:00:00]
Shaan: All right, today we have Marc Lore on the podcast. This guy is an OG of e-commerce. He sold Diapers.com to Amazon for — I don’t know — around $600 million. He created Jet.com and sold it to Walmart for three and a half billion dollars. Good guy. He came on and me and Sam were pretty blown away. We’re kind of little fanboys of his right now.
We enjoyed the episode. He had a bunch of good ideas. He talked about how to go raise a bunch of money to go after a big vision. He had some ideas in healthcare. Sam asked him a great question — like, if I wanted to start a company today that I could sell for $100 million to Amazon or Walmart, what product would you recommend I start? And he had a fantastic answer.
He also, at the beginning, talked a little bit about his approach — why he bought the Minnesota Timberwolves and how he’s going to run the team, how he builds his team.
Sam: The beginning is more philosophy, the end is ideas. And he had a great answer when I asked someone — like, when you bought the basketball team, did you just send a huge wire? Just hearing those details is really interesting. But we do a whole long debrief at the end of this episode which you might even find more interesting than the actual episode, because it’s always fun to discuss. I always find the recap to be one of the most exciting parts. Give it a listen.
Shaan: He was great. I think you’re going to love it. We liked him so much we want him to come back on — one hour was not enough.
Here’s what we ask you to do: listen to the episode, and if you liked it, he said he’s big on LinkedIn. So go to his LinkedIn — his name is Marc Lore, last name is L-O-R-E — and pop a comment on one of his LinkedIn posts and just say, “Loved the episode, come back on.” If he gets enough messages, we’ll be able to bring him back on and go deeper on a bunch of ideas we didn’t get to today. All right, here’s the episode. Enjoy.
Meet Marc Lore [00:02:30]
Sam: Okay, cool. So we have a guest here. Shaan, you want to team up? Who’s on the line?
Shaan: So — e-commerce tycoon, successful billionaire, and as of 2017, exceptionally jacked: in bold, Marc Lore. I have to ask you, which of these is your favorite part?
Sam: Shaan’s been polishing that one up for the last hour.
Marc: Ha.
Sam: Marc, we have you on. You’ve done a lot of stuff — you’ve started four different things, right? Four different startups that have successfully exited. The most popular one is probably Jet.com. Before that you did Diapers.com, which you sold to Amazon for $550 million-ish. That one might have been bigger because it was sold to Amazon very early and Amazon’s appreciated a lot since then. So maybe that one — I don’t know, you tell us: which one ends up bigger, the early one or Jet?
Marc: No, Jet definitely. The stock doubled over the last four and a half years, so that was a good one.
Sam: I gotta thank you for that. When they bought you, I bought the stock because I was like, yeah, there’s plenty of room to run here for Walmart e-commerce. I feel like I was a part of the company — won a little bit as well just off the news.
Shaan: And you also sold a company called The Pit — also called The Tops — that was for like $5.7 million, right, back in the day?
Marc: Yeah, that was right after the whole NASDAQ crash in 2000.
Shaan: And prior to that you were in banking, but before that you were a runner?
Marc: Yeah, I ran the 200 meter and 400 meter.
Sam: What was your PR?
Marc: I ran high 21s in the 200 and 4:48 for the 400.
Sam: Same with me, almost exactly the same. High 21s, high 48s. I got slower as the distance got longer.
Marc: The 400 was sort of long for me. I was better at the 60 yard, the 100, and the 200. But yeah.
Buying the Timberwolves [00:05:00]
Shaan: So you’ve done a ton of stuff in the past, but even what you’re doing now is interesting. You guys made a bid for the Timberwolves?
Marc: Yeah, we actually — it went through. We signed an agreement. We’re just going through the NBA approval process now, and hope to close in about six weeks.
Shaan: Was that a dream? Like, I’ve had this dream as a kid to own an NBA team?
Marc: That’s the point of doing business. As a really small kid it was: play professional sports. Of course, that’s where every kid starts. You eventually realize, okay, it’s not going to be that sport, it’s not going to be this. Then I was like, maybe I’ll be a decathlete and go to the Olympics. And I was like, okay, that’s not going to happen. All right, forget it — I’m just going to one day own a team. That’s what I’ll do.
I was a huge sports fan growing up, followed every sport, watched every game. Huge Knicks fan. Then I had two kids and life happens, you sort of get a little detached from sports. But I love it. I’m excited to dive back in and have a reason.
Sam: It seems like, I don’t know, ten or fifteen years ago the sports team thing was like “you’ve made it” — it’s like buying a car, your toy. Now the business merits of buying a team as an investment have actually become a pretty big deal because these franchises have appreciated like crazy. There’s only thirty of them, and there are more billionaires than there are teams. Give me a pie chart — what percentage is “I just want to have it” versus “this is a good business”?
Marc: It’s probably 80% the former, 20% good investment. It’s not so much about being a great investment. I’m not going to lose money. I’m going to have a lot of fun. Anytime you can have a lot of fun and not lose money, I love that. You know, I love going to the horse track — you have a lot of fun but you also lose a lot of money. This is like: have a lot of fun and maybe make a little bit of money too. It’s perfect.
But I’m excited about just innovating, applying a technology mindset. How do you bring augmented reality to the entertainment experience? How do you move to dynamic announcing where you can choose your announcer? Dynamic real-time ticketing. I want people to move to any open seat in the stadium at any time. I’ve got all these tech ideas on how to augment the experience. It’s just fun to have a platform to try these things.
And also, what’s the Moneyball version of basketball? As a mid-market team, how do you win? What’s the strategy? Thinking that through. How do you apply the same techniques of vision, capital, people? What’s the mission, what are the values, what do you stand for, how do you show up every day, how do you live those values? Treat it like a real startup. To date, talking to a lot of people, it doesn’t really seem like anybody’s gone down that path.
Shaan: Are you just going to run this like a company? Because you’re incredibly successful at running companies, but this is totally outside of everything you’ve done.
Marc: I love the challenge. Every business I get into, I don’t know anything about it when I start. I didn’t know anything about retail when I did Diapers.com. I didn’t know anything about The Pit when I started that. I’m starting and building a city. I’m doing a reality TV show. These things all come down to vision, capital, people.
You have to have the vision, and you just think about it, share it with people — it’s like a piece of clay, you keep molding it. You keep molding the vision until wow, this is big, everyone agrees this is freaking huge. Okay, great. How are we going to capitalize it? That’s what I do — raise money. I have lots of connections with investors; raised over a billion dollars. We’re going to capitalize it.
And then the third part is the most important and the hardest to get right: people. Finding a great CEO and a great executive leadership team. Setting the values, setting the mission, the corporate culture, getting the org structure right, getting the right people in the right spots, and creating a culture where you get the very best out of each person you bring in. Then you sit back. You’re there as a strategic advisor. If you’re trying to micromanage and make decisions when you don’t have the experience, that’s where you get in trouble.
If I were to come into the team and say, “I think you should draft so-and-so, and we should be playing this and that” — that’s not going to work. It’s: who is the very best person in the world to run this part of the business, to run that part, to be the chief people officer, to bring in the very best talent and create a great culture? Get them in the right spots. If the vision is right, everybody’s clear on where you’re going, what the north star is, and you’ve got great people who are happy and empowered — great things will happen.
And that allows me to do multiple things at the same time, because I’m not getting into the weeds.
The VCP Framework and Fundraising [00:11:00]
Shaan: A lot of your companies — how much did you raise at Diapers.com?
Marc: Diapers raised $55 million.
Shaan: Okay. And Jet was what, like $800 million?
Marc: Yeah, roughly $800 million. Substantially larger.
Shaan: This idea of being able to hire the best in the world — could you have done that if you were bootstrapping?
Marc: No. That’s why Alex and I — we just started a venture fund called VCP: Vision, Capital, People. We believe there’s a really big hole in the market for people with big visionary ideas to get a big infusion of capital early, when they have nothing, so they can go out and hire the very best team in the world.
A lot of startups, it’s a chicken-and-egg problem. How do you get the capital unless you have the team? You can’t hire the team until you have the capital. But you don’t get enough capital until you prove it. So you get a million bucks, then five million, then ten million, and each step of the way you’re on a tightrope. You overpromise, underdeliver, things go wrong, investors lose confidence.
We basically say: no. Vision, capital, people. You have a big vision, we know this could be a really big idea, we know somebody’s going to do this — the right time is now. Let’s not undercapitalize it. Here’s $10 million seed. Go out and hire the best team in the world. That puts you in the best position to have the best shot at a really successful business.
If you’ve got the best people, you’ve got the capital, and you have the vision right, you’re a player. Worst case, you’re going to exit — somebody’s going to pick it up because you’ve got great people and it’s the right time and it’s a big vision.
Sam: So there’s the case of Jet, where that clearly worked. Then you see something like Quibi — raised a billion dollars, clearly successful people at the start, big vision, “we’re going to rethink Netflix for mobile” — and they burned a lot of money and didn’t hit it. They still had the same sort of two-year runway problem. How do you think about that? Is it just a numbers game, or was there something in the strategy?
Marc: I don’t know that situation intimately. But I do think that’s probably more the exception than the rule. Listen, startups don’t all work — some do, some don’t. Do I think it had a higher probability of working because it was a big vision, with a lot of capital and great people? Yeah, I think it does.
Specifically why it didn’t work — the only thing I wonder, from the outside looking in, is: were the most talented people in the organization fully committed and all-in to it? That’s the only thing I wonder. Obviously they had really talented people, but were they dedicating their life to it? You need somebody in these businesses who’s running it and dedicating their life to it. It doesn’t have to be the person doing the VCP at the top, but who is that person, and do you have the right team to support them?
The Hiring Philosophy [00:17:00]
Shaan: So let’s talk about the people part. On the people part — take us into a job interview with you.
Marc: So obviously there’s the standard stuff — you ask what they’ve done. I’ve hired — I’ve tried to calculate it — over a thousand people personally, interviewed in my career. My thinking has changed on hiring.
Early in my career, I just wanted to feel like I want to have a beer with this person. I realize how wrong that is. People make that mistake today. It leads to all kinds of unconscious bias. It’s the worst possible thing to do.
Now I spend an incredible amount of time up front on resume reading. I don’t listen to what people tell me about people, because there’s always somebody out there who’ll say something good about everybody — so I discount that for the most part. There might be a select couple people I really trust. But that’ll show on the resume anyway.
When I look at a resume, I’m looking for a demonstrable level of success. I get into their mind and start at the beginning. When they graduate school — doesn’t matter what school — they go into a company. If they’re there for a few years, did they get promoted? What did the trajectory look like?
Then the most important part: when they leave that company and go to a new company, is it something that a top-five-percenter would do? Top five percent moves in a certain way. Top five percenters — when they move, they move in step fashion. It’ll be a bigger title, much bigger role, a better company. They get there, they get promoted multiple times. Then they leave — another step change. I’m looking for that multi-company movement and big step changes. Any deviation from that pattern, I won’t even interview.
A lateral move — moving from Google to somewhere that’s a step down — just a little tap that says not top five percent, and I won’t interview. Somebody could say, “Hey, that’s not fair, this person’s actually good.” I’m like: you know what, there’s a chance I get honey-potted.
Everyone’s experienced this. You bring somebody in for an interview, the resume is maybe not ideal, they come in, you spend one hour with them, you really like them, they throw some buzzwords around, and you’re like, “hired.” Think about that — you’re committing to hire somebody and hopefully keep them for years as an important part of the company, and you have one hour with them. So I don’t let myself get honey-potted. I’ve been honey-potted many times in the past.
Unless that resume screams superstar — and it’s only five out of a hundred resumes, if you’re saying top five percent — then I say no. You’re tempted, like, “Oh, they have good experience.” No.
So when I interview someone, I already know they’re a superstar on the resume, and I can focus primarily on core values and on SPOTTAKE traits.
Sam: SPOTTAKE?
Marc: SPOTTAKE is an acronym I came up with for the traits I look for in people I hire: Smart, Passionate, Optimistic, Tenacious, Adaptable, Kind, and Empathetic. The last two are really important — kindness and empathy.
I’ve found over the years that you can get somebody who’s super tenacious and passionate — they’ll run through a brick wall, but also run over people. You find somebody who has the passion, who’s optimistic and tenacious and adaptable, because you need that in a startup — but at the same time they’re very kind and empathetic. Someone who can balance that — that’s magic.
And the interview questions have nothing to do with traditional interview questions. They’ll all be questions to open the person up, to try to get at what makes them tick and whether they exhibit these traits.
Shaan: I sort of found that two really simple traits tend to be lowest in supply and have a pretty outsized impact in startups. Those two are: energy or enthusiasm — bringing energy to the table every day is quite contagious and you need it at the beginning — and courage. The courage to build something new, to say something that’s on your mind, to not let something below our standards go. Courage is in extremely short supply.
Marc: Yeah. When I say passionate and optimistic, I think optimism isn’t just the optimism that allows you to be bold and take risk. It’s the optimism that you believe not only that great things can happen, but also that people are good. Your starting place is an optimistic view of the world.
That’s really important. It allows you to trust. Trust is really important in all my companies. If you want to create a culture where the company trusts employees and employees trust the company, that creates an environment where people are happy, feel empowered, and have a sense of ownership.
I have this idea: a lot of people say, “Trust, but verify.” I don’t believe in “but verify.” I think you start out trusting people, until they prove otherwise. It’s risky, you can get burned. But I’ve seen the incredible power of the upside of trusting somebody before they’ve necessarily proven they deserve it. It’s an incredibly powerful motivator. People want to run through a wall for you when you’re like, “I trust you.” “But you can I can burn you.” “Yeah, I trust you. Are you going to burn me?” “Of course not — you’re trusting me.” That is an incredible value I’ve learned.
Then transparency — being really open with your employees. Not hiding, not secretive. Here’s the cap table, here’s the rounds of financing, here’s the numbers, here’s all the information you need. I’m an open book. You work at this company, you’re an owner, you have stock options.
And fairness — in order to create an inclusive, diverse workforce, you have to create a safe work environment where people feel it’s fair. That’s why I have an open compensation system where everybody knows what everybody else is making, and everybody at the same level makes the same amount of money. Women, minorities, everyone makes the same. You take off the table this idea of: “Why is my colleague who does the same job making more than me?” That’s usually a big reason why people lose trust and stop giving you everything they’ve got.
Sam: Where does that confidence come from? Because having the confidence to hire the top five percent is a pretty big deal.
Marc: It’s actually just trial and error, failing a lot early on. You know — wanting to have a beer with somebody, making that mistake. Getting honey-potted. Hiring a person and going through the pain of having to let them go and replace them. So many lessons. I make so many fewer mistakes now than I did earlier in my career. And people make the same mistakes — that’s why I like to talk about it, because it is the same mistakes, over and over.
From Banking to The Pit [00:30:00]
Sam: I want to ask you — you left banking in ‘99, right?
Marc: Yeah, ‘99.
Sam: And I’m looking at your timeline — you started this thing called The Pit?
Marc: Yeah, The Pit was internet marketing. Basically a sports stock market. To avoid gambling we used baseball cards as the proxy for the athlete, but essentially it was meant to be a sort of sports stock market where you buy and sell players like stock. And you sold that for like $5.7 million?
Marc: Yeah, that was right after the whole NASDAQ crashed in 2000. No way to raise any venture money. We’d only started it maybe ten months earlier. We raised $5 million, sold it for $5.7 million. Everyone’s like, “Yeah, do it, this is a great exit.” And we’re like, okay, we’ll do it again. We’ll sell this and get the next idea.
Sam: I was going to ask how you could sell for six million bucks after such a short amount of time, but I guess the answer is you’d raised a fair bit.
Marc: I think it was just that The Tops at the time was interested in the people we’d hired. We had a great team, we had a vision for what we wanted, and they were there to provide some capital.
Emerging Opportunities: Where Is the Puck Going? [00:32:00]
Shaan: All right, so let’s talk about some ideas that you would need optimism about now. I think we could talk about Jet — it took courage and optimism to go after that prize and basically compete with the empire of Amazon. But I want to start with: where do you need to be optimistic today? I know you’ve talked about startup cities. Let’s shoot us some ideas of what you think is exciting.
Marc: I tend to gravitate toward B2C businesses, business-to-consumer. I just like consumer businesses. I think it’s easier to understand some of those businesses than, say, a biomedical company. So most of the ideas and things I think about are in the B2C world across lots of different industries.
I’ve made a number of investments, and I’m involved with a few companies I’m really excited about. One is Archer — basically they’re like passenger drones. Autonomous electric helicopters that fly passengers around. Safer than hell.
Sam: That was a SPAC you did?
Marc: Yeah, went through the SEC process recently. Super exciting. The two founders came over, sat right here on the couch, and said: we’ve got this vision for these flying cars, these drones that carry passengers. It’s the right time, this is why it’s the right time, this is how big the industry’s going to be. I was really taken by the vision.
They said: we need $5 million now. We’re going to hire the best engineers in the world — from the best companies — and then raise $50 million and build the state-of-the-art aircraft. I thought the two founders were exceptional. So great start on the “P” part of VCP.
I put in the $5 million, helped hire the engineering talent, helped them raise $50 million. That was two years ago. They just raised a billion through the SPAC at a $3.7 billion market cap. And it was really an idea on this couch two years ago.
It shows what I was saying before — rather than going through this process of seed, can’t hire the great team, chicken-and-egg — it’s: here’s five million, let’s get the team, and simultaneously go raise $50 million. In short order they had $55 million and the best people. I think they’ve built the very best aircraft in the industry right now.
Sam: Yeah, yeah. What else?
Marc: Another one that was in the news — basically mobile kitchens. Looking at the trends in food delivery, millennials and Gen Z not wanting to cook and wanting food delivered, I saw it takes a long time to get delivered, the quality suffers in transit, it’s inconsistent, and it’s expensive. If you can solve those three things — what if you cooked in a mobile kitchen? The restaurant basically came to you and cooked in your driveway. Piping hot, much faster because the truck’s already on the road.
Sam: How is that different than a food truck?
Marc: It’s a mobile kitchen, but for multiple types of food — each mobile kitchen is a different restaurant, a different cuisine. The idea is to get the best restaurant of that cuisine in the country and bring it to a central place. High quality food that’s piping hot, delivered to your door fast. Big TAM, big market. That’s where the puck’s going with food.
Then there’s also a lot happening with laws changing in sports gambling. I think there’s a really big opportunity to bring back some of what I did before with The Pit — do it right this time, where it really feels like you’re buying and selling players like stock, leveraging the changes in gambling laws.
Sam: Have you seen Big Clout?
Marc: No, I haven’t.
Shaan: It’s kind of what you’re describing. What they did was take Twitter and turned it into a social network where you don’t just follow the person, you can invest in them. They took the top 10,000 Twitter accounts, raised $150 million from VCs, and used it to basically pre-buy and invest in all those accounts.
So on day one when I walked in, they said: if you sign up and verify your account — meaning you tweet that this is your Big Clout — you walk into like $75K worth of your own coin. And others were already buying it because they’re saying, “Hey, if Shaan joins, we think he might continue to grow his following, so we want to invest.” Every single person gets their own little bitcoin, basically. As more people buy it, yours appreciates. As a curator, as a fan, you get to go along for the ride.
The key is, the creator can reward their shareholders. In the stock market you give out a dividend — I could do the same. Say hey, for whatever I earned this month, my shareholders are going to get their proportionate share. Or: we’re going to do a version of this podcast that only my shareholders get to listen to. Like an “only fans” type situation. If you’re a subscriber of mine, you get the content.
Marc: Yeah, that’s interesting. I tend to shy away from things where I don’t see the 20- or 30-year intrinsic value — how this ultimately holds up. But I think with gambling law changes, there’s a way to give players intrinsic value. Basically say: at the end of somebody’s career, you’re going to pay based on their career stats X. So the exchange sets the price — this rookie comes up, and the stock market says the market believes Zion’s going to be a Hall of Fame player, and that means these stats, this many points, this many MVPs. Do you think it’s better than that? You buy. If you think it’s not going to happen, you don’t buy, or you short. Basically you’re predicting the player’s journey, and the better they perform, the more you’re vindicated, and you economically benefit from having identified someone who was going to outperform the market.
Sam: That’s cool.
What Marc Looks for in Big Trends [00:44:00]
Sam: I read somewhere that you use Google Trends a lot, and you’re always looking for what’s popular. What signals do you use to figure out where you’re going? And also, what signal told you that Jet was interesting? Because I imagine a lot of people said don’t even think about doing this — Amazon or Walmart already owns this space.
Marc: Those are two different things. With Jet, I’d been intimately involved in retail with Diapers.com and Wag, and selling to Amazon and working inside Amazon. I just felt like: huge market, huge tailwind, e-commerce is going to continue to grow at double digits for the next five to ten years. I believed it wasn’t winner-take-all, there was room for another player. I thought: if we can raise a significant amount of capital and hire a great team, with this really big vision, this tailwind, a ton of capital, and a great team — I thought if you do those three things right, good things will happen.
I don’t know what’s going to happen — either it works or a strategic wants it. If you’re in the right market at the right time, you have a great team, and you’ve invested the capital wisely, you’ve got an asset that worst case is going to be worth more than the capital you raised.
The worst place to be is in that no-man’s land where you’ve spent not a ton of money but you don’t have the best people — but you’ve spent enough that it’s kind of expensive for someone to buy as a strategic. It’s not really worth it. People tend to buy at the barbell. They’ll do the acqui-hire — you raised a million bucks, you bootstrapped it, you have three good people, and somebody says, “Oh, this is great, here’s $10 million.” Or they’ll buy the big company that’s big enough to matter to a really big company.
A lot of people are in the middle. That’s what VCP is about. That’s why it’s: no, here’s $10 million, here’s $50 million, let’s hire the very best team. If it’s the right market, there’s going to be a buyer for it.
Sam: What’s interesting is I noticed that a deal in a middle-size range — it seemed like it was as hard work as selling for $400 million. Maybe harder — I actually didn’t hire a banker, so I was doing most of the work.
Shaan: And it’s not just the work on your side. The price tag is significant enough that the company can’t just cut the check quick, but you don’t have enough of an asset that they can say this is a big strategic bet. You’re in the middle.
Marc: Exactly. That’s kind of the hardest range. It’s hard to exit most companies in that middle ground. It’s easy to do the acqui-hire, and I think it’s easier to do the big acquisition of a big company. That $10-to-$100 million range — the entrepreneurs I know who have exited in that space are strong, they’re really strong.
Sam: I think most people — even just a few months younger me — would think that twenty to thirty million would be bite size, like some company would buy us without having to get board approval. And what you’re kind of saying is it’s actually probably easier to be a little more audacious. Raise money and go after it.
Marc: I would actually say the other way around is also interesting: it’s easier to either go big, or — if your goal is to build wealth and have a good life — maybe not raise any money and never sell, just try to build the company over a long period of time.
What Would Marc Build at 21? [00:51:00]
Sam: Let’s say I give you youth but take away your reputation. You’re 21, you don’t have the reputation, but you have the same mindset you have today, the same knowledge. What spaces would you be going into? And would you try the same type of bet — raise a large amount of money — just through charisma and hustle and vision, without the reputation?
Marc: Yeah, that’s a great point. Early on, and a lot of people share this, you feel like it needs to be something really original, something nobody’s thinking about, something niche. And venture capitalists are like, “It’s not that interesting.” I’ve learned it doesn’t need to be niche or super inventive. It could be: find a really big TAM.
Like, just say healthcare. And then: what’s a really big idea? Where’s the puck going in healthcare? I would study where the venture capitalists are investing, what types of companies, follow the money — that gives you some idea of where the trends are. Right now with artificial intelligence and telehealth, there’s a lot of money pouring in. So I would look at the landscape, study the different companies getting funded, and think: is there another angle? Is there something not super original, just a little hook of something different that’s not being done?
Put together a big vision that requires ultimately hundreds of millions of capital, and work backwards from that. We think this is going to be a multi-billion dollar opportunity. Start with $10 million, hire this team, here’s how we’re going to get there. Work on that plan and that pitch deck — I’d spend hundreds of hours on the deck and on the vision and mapping it out. Somebody will bite, because it’s the right time, the right space. If you’re really good and they feel like you’ve got something and you’ve got this big plan, there’s a good chance you’ll get that $10 million seed check to go hire a great team.
Big Ideas: Conversational Commerce [00:55:00]
Shaan: You talked about where the puck is going. Give us more. You talked about food delivery and the restaurants-on-wheels evolution. You talked about transportation, flying cars. Give us a couple more.
Marc: So one I think is conversational commerce. In retail, I think the next big step change is using text and voice to order anything you want in a very conversational way. Imagine talking to someone who is as knowledgeable as the most knowledgeable person in that area on the showroom floor of a specialty retailer. You want to buy a TV — it’s like you’re at Best Buy talking to the TV expert, just conversing. And at the same time, that person knows you as well as your best friend — hyper-personalized. One best answer.
The idea of a search engine twenty years from now is going to be laughably like a cassette tape. “Wait, dad — you wanted to buy a toaster and you typed ‘toaster’ into this search engine, and you had ten thousand responses and had to read reviews and search and filter?” That’s not the way it’s going to be done. You’re basically just going to say: “Hey, I need a toaster.” “How much?” “I don’t know, what’s a good amount?” “Two hundred bucks gets you a great toaster.” “Really good?” “Okay, great — can you make a recommendation?” And it just ships. It’s going to be very conversational.
We talk a lot about personalization, but nobody’s even close to doing it in a way that it’s going to be done in the future. And voice requires one best answer — you can’t give a hundred things on voice. It should be like asking your best friend: “Hey, you know toasters, what should I get?” Very on point.
Sam: Who’s doing this now? I like that a lot. What companies are doing this?
Marc: There are companies in early stages of it. But nobody has the world-class team that’s raised significant capital and is going for it. There’s not a product you can go look at today and be like, “Oh, I get it, I understand why Marc is obsessed with this.”
I had something called Jet Black when I was at Walmart — basically this concept for New York City, primarily for parents. And it was gangbusters. People stopped using Amazon Prime. Their entire shopping basket was given to Jet Black, and it was multiples of what they were spending on Amazon. Deep into the tail, everything — people loved it.
It was a great test, but very expensive because in order to automate the AI responses you needed to see a lot of conversations first. In the beginning you have humans in the loop while you build the automation. Then it went away — it was expensive, and there wasn’t the right time for Walmart to invest hundreds of millions. But in a startup world, totally different. It doesn’t hit your income statement the same way — everyone understands you put capital to work and build something great.
Big Ideas: Personal Health Dashboard [01:03:00]
Marc: In healthcare too — I think about this a lot. People taking control of their health with home diagnostics. There should be a dashboard that exists: you put in your name, here’s your dashboard. You have a number of gadgets in the home that you use on a weekly and monthly basis. Like, you brush your teeth twice a day to take care of your teeth — what are you doing every day to take care of the rest of your health?
A little prick of blood, monitor blood sugar. A blood test once a month, get all your things in there, look at the trends. What’s happening with your PSA? Do you have this issue? Then machine learning runs through all the data and says: you should see a doctor here, you should do this, you should do that. Here’s the probability of dying at this age. Here’s your heart attack risk — your cholesterol is too high; if you get it down here, here’s how your probability of heart attack comes down.
Make it more transparent. Right now it’s a black box. You go to the doctor once a year, do some tests — it’s kind of like, “Oh here’s some medicine for your cholesterol.” You don’t know what’s what, or why, or how it impacts your odds. No doctor will ever give you probabilities about anything. There’s no home diagnostics. I think all that’s going to change.
Shaan: I just had a daughter and I feel like when she’s my age she’s going to be like: “Dad, how were you even alive back then? You guys had no idea what was going on inside your body. Now we have this thing we wear that tells me everything I need to know. I know when I take a bite of this, my blood sugar goes up or down. I know how stressed I am.” It’s going to seem like cavemen.
Sam: My daughter had celiac disease. We didn’t figure it out until she was nine years old. That’s not even a rare disease. Some doctor should have been like, “Hey, here are the things we do — here are the probabilities of what’s what and these are the tests you need.”
Marc: I was asking my mom — my mom has celiac as well and she found out when she was fifty. As a kid, everyone was like, “Oh, I don’t know, you just have an upset stomach all the time.” She said, you know, I’m a kid in India — I’m sure I had this my whole life, nobody ever knew. I never gained any weight because I couldn’t process any of the food I was eating. It took until I was fifty.
Everyone should have a genetic profile that adjusts your probabilities based on genetics. Tests at certain times that influence your odds and give you certain ways to structure everything. Right now it’s not organized at all.
Shaan: Yeah, like I have a Whoop and an Oura Ring and a smart scale and a continuous glucose blood monitor and a smart bed — like eighteen different smart things. But they are quite siloed. They don’t actually tell me the answer. Maybe they’ll say, “You’re extra stressed this morning, sleep more or don’t work out as hard.” Kind of limited to high-level stuff.
Marc: Yeah, it should be way more structured. You should be much more in touch with it. Sleep apnea is another thing — so many people struggle with this, and it takes a long time before the doctor says you should do a sleep apnea study. You can have devices listening near your bed that can detect it. And cancers — a lot of cancers you’re completely fine if you catch them early enough. It’s kind of outlandish and archaic that you can have a cancer and not know for many months or a year.
Sam: What the [bleep]. You could have known this like instantly.
Marc: MRI scans — you do your whole body scan and look for anything cancerous, then stitch it together every year and see micro changes. That exists now. It’s just not made available because of the cost. But nobody even has the option of knowing that’s available. You could imagine a system that says: here’s the probability of cancer, you can take this test for a couple grand — it’s up to you, but at least you know. Instead, we just wait until we’re sick.
Companies Marc Is Watching in Healthcare [01:11:00]
Sam: I like asking these questions to know what meets your standards — basically, who in this space are you looking at and saying, “That’s kind of promising”?
Marc: I don’t spend a lot of time on that, honestly. Sometimes if you know too much about a space, it’s hard to clean-slate and invent, because you get tied too closely to what people are doing. I like the idea of just thinking about it through the lens of a consumer — what are these trends, telehealth, AI, these trends are happening, and how do you stitch it all together? Just sitting and thinking every day: what’s the big idea?
And when it’s really big, you know nobody’s doing it. Then you can reverse-engineer and go back and say, are there people working on certain things that could be helpful? But you’ve got to go so big that nobody’s playing there — that’s where the opportunity lies. It’s going to need billions of dollars to pull off, you’re going to have to prove it in a small area, it’s going to be very expensive. But when you prove it, it extrapolates out to a trillion-dollar market cap opportunity.
Sam’s “Sell to Amazon” Question [01:14:00]
Sam: Something you said earlier — you’d reverse-engineer, find where the money’s going, build a deck, raise money, then go build the thing. What’s something where I say: “Marc, I want to create a company and sell it for $100 million-plus to Walmart or Amazon in three years. What opportunities exist in the e-com world or commerce world that Amazon or Walmart would desperately need — some solution I’ve created?” What would you say?
Marc: For Sam — the most specific question.
Shaan: That’s actually not that specific.
Marc: A lot of things. I mean, I don’t work at Amazon — I don’t know exactly. But one hundred million in three years — well, the conversational shopping thing I described, I think that’s either way bigger than $100 million or it doesn’t exist yet. More binary.
Three years is fast, so it’s going to have to be more tech than real market traction. It’s going to have to be a technology that’s probably hard to build, involving AI. The thing that comes to mind would be fit analytics — this idea that you’re buying a dress online and being able to see it fit on you without having to get it delivered to your home.
Return rates on apparel are 40%. Very expensive for retailers, and a pain for people to buy stuff, bring it home, try it on, send it back. The idea that you know my body dimensions, you use AI to know the inside dimensions of the garment, to see exactly how it’s going to lay on my body without having to try it on — you cut down return rates dramatically. There are billions of dollars you can save retailers in apparel. Apparel is definitely an area where there’s a lot of focus. That’s just one thing off the top of my head.
Sam: I love that. Great answer. There was this guy in Japan, a billionaire entrepreneur — his third or fourth swing — who created a suit with these dots on a black bodysuit. He’d send you the bodysuit for twenty dollars, and the white dots on the black suit let the camera do motion capture-style body tracking. He used it to upsell proper-fitting clothing. I saw it and I was like, oh, that’s kind of interesting.
Marc: For every idea out there, there are hundreds of people trying. That’s why it’s never really about the idea — it’s about execution. It’s about VCP. Are they undercapitalized? Do they have the best team in the world?
And Quibi — I know I mentioned it at the beginning — but examples of big vision, right time, massive TAM, raised a lot, world-class team that’s all-in: there’s not that many examples. And when I think of those examples, they’re usually examples of things that worked. Deep Mind was a good example — an AI company, acquired by Google for $500 million when there was no usage yet. Just vision and team. And then they applied it to Google AdWords machine learning and it’s reportedly generated multiple billions of dollars already in incremental revenue from a slight optimization. On the other side you have Magic Leap, which would probably be the current example — raised like a billion bucks, huge idea, looks awesome in the demo, but they haven’t executed it well enough where it actually works. Or maybe just a little early.
Sam: Right. The same exact company today, going forward, could be a totally different game.
Marc: So it would be great to map out VCP against companies that have worked and didn’t work to see what the hit rate is.
Wrapping Up [01:22:00]
Marc: Sorry guys, I’m realizing I have a four o’clock.
Shaan: You gotta run. Where should people find you?
Marc: LinkedIn is where I’m putting out a lot of business advice, so LinkedIn is probably the best place. I just recently launched Instagram and am starting to become more active there, but LinkedIn is primary right now.
Shaan: All right, Marc, thank you for coming on.
Marc: Thanks, guys. It went way too fast.
Sam: It was good but it ended quickly. I wanted so much more. I had so many other questions.
Post-Episode Debrief [01:23:00]
Sam: I think we should hit him up and say, “Dude — after this episode goes out and he gets some love, come back for part two.” I needed a part two. I had like five other things I wanted to ask.
Shaan: He was great. He’s really charismatic. I get why he’s successful. He would be describing an idea off the cuff and I’d be like, “This makes so much sense. I would back you to the hills.”
Sam: I asked that confidence question because he just oozes with charisma and confidence.
Shaan: His setup was bad, though. I cannot stand when people — he was talking on a phone or laptop. For someone as successful as he is, why do they not have an awesome Zoom setup?
Sam: They’re just on the go all the time. They’re like, “I don’t even hold my phone — this woman holds my phone for me. I don’t even type anymore. I don’t even own a computer.”
Shaan: Wait, he doesn’t own a computer? Was that true or are you just bullshitting?
Sam: That’s what I was told — he doesn’t own a computer. There’s the mega rich, the most rich — they don’t own a computer, they don’t even touch one. Their emails get printed out and they either hand-write or just say things out loud and people relay the messages. I think he’s one notch below that — he doesn’t own a computer, he just does everything off his phone.
Shaan: That’s weird to me. What if you just want to type a long essay, or browse the web?
Sam: If you took my computer away, forget the work — I would be so bored. I need to browse the internet.
Shaan: So he doesn’t own a computer. That’s pretty cool.
Sam: The guy’s awesome. He had a few really good ideas. He sent us these notes ahead of time and said this thing about the difference between a million and a billion, and I was like, “Oh come on, I’m dying, we gotta get to it.”
Shaan: We slowplayed it a little too much at the beginning.
Shaan’s Takeaways [01:27:00]
Shaan: Okay. I don’t usually do takeaways because I don’t think I really learned so much I want to do a recap, I’m just entertained. But in this one I actually did have a few. I’m just going to rattle them off.
Insight number one — the barbell of selling your company. It’s very easy to sell at the small end and even at the high end. The hardest path is actually that middle ground — where both of us have sold our companies — and I’ve never heard anybody kind of say it out loud. That was a good insight.
What he said was: it’s easier to sell a company for like $10 million or under, or for hundreds of millions. The small one you can cut the check just on talent. The big one you’re buying a more fleshed-out asset of technology or traction or unique talent. In the middle, you’ve usually raised enough money where your asking price is too high for them to do it without blinking — but you don’t have enough proof and enough of an asset that they can justify a big strategic purchase. That’s actually the hardest one.
And I think he was hinting at something true: the entrepreneur who’s done that middle exit is the most dangerous entrepreneur. They have enough money where the next thing they chase, they’re going to go bigger. But they didn’t get enough where they’re satisfied and going to go chill on an island. They’ve been through it but they’re not done.
Sam: I had Andrew Chen — very successful Andreessen partner — say something similar. He said the most dangerous entrepreneur is someone who’s somewhat wealthy enough that they’re set but have a huge chip on their shoulder. For example: Travis before he started Uber had Red Swoosh, which was like a tens-of-millions win. Ev Williams before Twitter had Blogger, which was a good win but not enough — went for more. Mark Cuban did the same thing.
Shaan: Okay, some other things. His model — I didn’t realize this beforehand — is basically moonshots. He’s anti-traditional Silicon Valley playbook: raise a little, make a little progress, raise more, make a little more progress, raise more, make more progress. He’s sort of like: find the biggest market you can go after, raise a bunch of money, and make the boldest bet in that market.
What he did with Jet: e-commerce, huge market, growing double digits. And he was saying you don’t need a brand-new novel invention. The bet is going to be on execution. You do want some new hook, like the 10 or 20 percent that’s innovative. But 80 percent is the same as other players in the market. So: do that, raise a big chunk of money, recruit the best people, make great product, raise a huge amount, go for the home run shot.
Most people don’t use that playbook or talk about it. That’s his specific lane as an entrepreneur and as an investor.
Sam: I also thought — I asked a question that you laughed at a little bit — “What’s a company I could start and in three years sell for $100 million to Amazon or Walmart?” It was so specific that I was like, it’s almost like, “Hey Mark, I don’t want to think, just tell me what to do.” You kind of laughed. But it was my orthogonal way of asking: what problems do big e-com businesses have that need to be solved?
Shaan: Yeah. And he gave a great answer — actually two great answers. The previous one about conversational commerce, and then the one for the specific question: virtual fitting. The idea that you know my body dimensions, you know the inside dimensions of the garment, and you see exactly how it’s going to lay on my body — cut down return rates dramatically. Billions in savings for retailers.
And this guy’s perspective is about as great as it can get — he started Jet.com, sold it for three and a half billion, was president of Walmart e-commerce, and before that sold a company to Amazon for $600 million. So his perspective on what Amazon and Walmart want is gold.
Sam: I liked some of his stuff on the job interview side. I know how much people will love that content — it’s not as fun or “junk foodie” as ideas. But as somebody who actually has to hire, I thought there were good insights in there. And even though some of it seemed safe — nobody could really disagree — I think he genuinely believes it and that’s genuinely his approach. It matters a lot to him and that came through.
Shaan: I wanted to ask him more about not being in the weeds. He’s like — I’m not in the weeds of anything. I don’t want to be in the weeds. I only want to be in the weeds of things I choose to be. When you start a company there’s so much stuff you think you have to do. His perspective is: I have the vision, I hire the initial people, I raise a ton of money, and I deploy that money and make everyone else specialize. We didn’t get to ask him about it.
Sam: One thing he showed was — when you asked how do you figure out what the vision should be — he said: I look at where the trends are, where’s the puck going. One way I do that is I see where investors are pouring money. That tells me these spaces are probably big or these technologies are breakthrough. So it’s either like a technology — AI, machine learning, okay cool, I can apply that in another industry — or a bunch of people are pouring money into e-commerce, so e-commerce is probably really big. Now how do I go create the most bold vision that has a slightly novel hook?
And it’s cool that he doesn’t get bogged down in the details of what this player is doing versus that player. He’s just: how should it be? When he was talking about healthcare, he’s like, I should just wake up and have a dashboard that says here’s what’s going on in your body, and it recommends: hey, you should get this checked with a doctor, you should improve this.
From the mind of a customer instead of industry research. That’s a big Amazon thing too — you start with the customer, say here’s how their life should be that would make them really happy. Now I have a pleased customer. Now I’ll go figure out how to make that happen. Instead of: what can I do, and does that partially satisfy a customer? Okay, good enough.
Jet.com Acquisition Story and Listener Ask [01:40:00]
Sam: I wanted to ask him about Amazon and working with Bezos. And buying the Timberwolves — like, did you just send a huge wire?
Shaan: I want to share this crazy story that I didn’t get to bring up with him. Ben found this when he was doing research. When Jet was growing, early on, they had a contest: who can acquire the most customers for Jet? You become a marketer, you spread the word. Whoever gets the most customers gets 100,000 shares of Jet.
And some guy went and did it. He spent $18,000 into paid marketing, won the contest. His 100,000 shares became worth $20 million when it sold. This guy turned $18 grand into $20 million as a fan of the company — outside the company — and probably made more than almost anyone else in the company besides Marc.
Sam: I remember that story. I was one of those people trying. Did you participate?
Shaan: Oh definitely. It went incredibly viral — I think they had billboards promoting the contest. Robin Hood did a good job of something similar right before they launched: you’re on the waiting list, refer five people to move up your spot. Jet was first, I believe.
Sam: We should have asked him about this. We’ll save it for next time.
Shaan: I could spend two more hours with him easily.
Sam: Let us know in the reviews what you think. If you liked this episode with Marc, when we post it go on LinkedIn and shower him with love: “Dude, this was great, come back on.” We need to game LinkedIn a little bit.
I’ve consistently heard this from the very beginning of this podcast: guests say they get way more messages about this podcast than any other podcast they’ve ever been on. And when they get that magic moment of people reaching out — it works. They’re down to do whatever and come back on. You only need twenty or thirty emails in one day being like, “I loved it, I loved you.” That feels like a million emails to most people.
Marc’s name is Marc Lore — M-A-R-C space L-O-R-E. Look him up on LinkedIn and comment on whatever his recent post is: “Just saw you on My First Million, amazing.” Go hammer his LinkedIn comments. That’s all we ask.