Sam breaks down the $10 billion Halloween industry — covering Spirit Halloween’s origins, haunted house economics, pumpkin carving stencil sites, pumpkin-shaped molds, and Christmas light installation as neighborhood side hustles. Along the way, the guys riff on the Elon Musk Twitter takeover, the legendary “Rahul Ligma” troll, the Humane wearable device, and a Twitter thread about a guy who bought a mobile game for a million dollars and retired at 31 by doing the absolute minimum.
Speakers: Sam Parr (host), Shaan Puri (host)
Intro: Haunted House Economics [00:00:00]
Sam: So what they’re doing is they basically take a vacant property — same thing as a Spirit store. They take a vacant property and say, “Hey, we’ll cut you a check for $10-15 grand if we can use your house.” Or they’ll rent a property, or they’ll find a vacant property, and they basically just use it for the month. They have this operational thing where they can just spin up the haunted house, and then they charge like $40 to enter. You can do the math and realize, man, they’re probably making half a million to a million dollars in about a month.
Troll of the Year: The Rahul Ligma Story [00:01:00]
Shaan: All right, troll of the year. We haven’t even done our Millie Awards for the end of the year — that thing we always do — and I’m calling it now: troll of the year. Give the background.
Sam: So Elon takes over Twitter. I guess the purchase went through. I feel like there was never like a confirmation — like he actually wired them — he just literally showed up at the office.
Shaan: Yeah, there hasn’t been a proper ribbon-cutting moment. It’s not like a thing. He’s not a squatter. He just walked into the office and they’re like, “I guess you own it now. Oh, you seem to be here.”
Sam: Yeah, that’s mine. Playground rules.
Shaan: Wow, that’s all it took to take Twitter.
Sam: Have you ever heard of a coup d’état — with governments? You know, I read a lot of history books and they talk about a coup and I’m like, “So you literally just walked into the White House and said, ‘This is mine,’ and the general promised to commit soldiers to attack?” It’s an interesting concept. You’re like, “So it’s all just made up? These rules we live by — this is fiction.” That’s kind of like what I felt Elon did. He just walked in and said, “Well, I own this now. Thank you.”
Shaan: Have you seen Derek Lewis, the UFC fighter? That compilation where he says “just get up”?
Sam: No.
Shaan: So they’re like, “Derek, you’re a big knockout artist but the knock on you is what if you get taken down? How’s your jiu-jitsu?” And he’s like, “It just ain’t real, man.” And they’re like, “What?” He’s like, “You don’t need jiu-jitsu. Just get up.” And they’re like, “But you need jiu-jitsu to get up.” He’s like, “No, I’m just gonna get up.” And there’s a six-minute compilation of literally somebody takes him down and he just stands back up.
Sam: That’s how I feel that’s what Elon did. He’s like, “Nah, just walk in.” “What do you mean?” “I’m just gonna walk in with a sink and take it.”
Shaan: So anyway, he walks in and there are all these reporters outside Twitter’s office. They’re waiting for the story about something going wrong — a protest, a walkout. And what happens? The first big story is a picture of these two guys, kind of nerdy engineering-looking guys, holding giant cardboard boxes. It says these two data scientists were fired today from Twitter, seen walking out with their possessions.
Sam: I saw it and immediately something looked a little off. I was like, “This guy just looks so goofy.” But I thought, man, that’s pretty believable — there are a bunch of goofy-looking people working in tech. And then I read the name: Rahul Ligma and Daniel Johnson were fired today.
And I saw that and I was like, “Oh my God, this guy executed a ligma.” For those who don’t know, it’s a joke on the internet — you say “ligma” and someone goes, “What’s ligma?” It’s like, “Ligma nuts.” That’s the joke.
Shaan: And they did this to basically — I think CNBC was the first one who reported it. And then the same photo kept getting spread because everybody wanted this story. This CNBC reporter tweeted something like, “We’re at the scene of Twitter. These two engineers just came out — the first to be laid off. There’s just a visible defeat about them, totally broken.” And Rahul Ligma says he has no idea how he’s gonna afford his Tesla payments. He’s sitting there holding a Michelle Obama book.
Sam: I don’t know why the Michelle Obama book. He just had his box and the book. She tweeted it out: “The first of many.” It was a crazy, crazy scene.
Now we got the My First Million exclusive juice on top of it. Somebody in our group chat knows this guy, and he shared the text message the guy sent before he did it. He goes, “Yo bro.” The person says, “Sup.” He goes, “Are you doing anything in the next hour? Want to help me pull off a stunt? I’m at the gym and I need a box. LOL. I’m gonna walk out in front of the Twitter office with a box in my hand. There’s hella TV crews outside.”
That’s literally how he pulled it off. He gets an empty box and a Michelle Obama book — nothing else in the box — and walks out in front of the TV crews and they go for it.
Shaan: And then after — “Bro, the media is so dumb. I literally put five minutes of planning into this. Even my uncle in India has seen the picture now.”
Sam: Who is this guy? He’s like a founder of some tech startup. He just did this before going to the gym. “I got to the gym. It’s near Twitter headquarters. I saw all these cameras, so I just went and did it.”
Shaan: Amazing. That is so funny. I am ready to invest in whatever he’s doing. His thing says “stealth startup.” I’m like, name your price, Ligma.
Sam: And did you see the interview with the other guy, Daniel Johnson?
Shaan: No.
Sam: He also had a gem. They’re like, “How do you feel about this?” And he’s like, “I don’t know. I just gotta go home. I gotta talk to my husband and wife and regroup.” The most San Francisco thing ever.
Shaan: Did anyone comment on that?
Sam: The news didn’t even catch it. They just played the clip. When I saw it I was like, that is the funniest thing I’ve ever heard. Perfect timing. These guys are comedic geniuses.
Shaan: Amazingly well played.
Elon’s Twitter War Room [00:11:00]
Shaan: Do you want to talk about the Elon war room? Like, what he’s actually doing in there?
Sam: Not really. I mean, I read that he said, “Hey, you’ve got a week to get this one thing done,” and I think that’s cool — that’s a good way to run things. I’m nervous he’s gonna screw it all up because I make money from Twitter and I don’t want it to go away.
Shaan: Chill bro.
Sam: Yeah, I’ve got consulting calls to take, so. I don’t really care that much. When he talks about this stuff I’m like, “This doesn’t impact me that much.” But I do find it interesting how he’s going about it.
The report is — and I thought this was another troll at first but I guess it’s real — he told every engineer to print out all the code they’ve committed in the last three to six months and have it ready for review.
Shaan: Why print?
Sam: So you can just see the pages. And then they changed their mind — I guess they realized how bad an idea that was — and like an hour later they’re like, “Shred the papers. We’re gonna review on the computer.” And people are like, “I printed out 300 pages of code. So I’ll just toss this, I guess.”
Shaan: And if you go to BusinessInsider, the headline is like — painting these people as victims. Like, “Here’s what it’s like to toil at Elon Musk’s Twitter. The expectation is literally to work 24/7.”
Sam: Straight clown behavior. I cannot believe they’re doing that. And it’s like — your job’s always on the line. This isn’t your right to work at Twitter. But also, I think a lot of employees are probably like, “This is awesome, we’ve been sitting on our asses. Let’s do it.” And that side doesn’t seem to be getting covered.
Shaan: He created a war room. He brought in people he trusts — his chief legal person, now basically general counsel. Jason Calacanis. And then Sriram from a16z, a former PM who used to work at Twitter. Some engineers from Boring Company or Neuralink, people he trusts. His cousin is there. They basically set up shop and said, “All right, what are we gonna do with this thing?” Change the logged-out page so it forces you to sign up. The verification program — you’ve got five days to deliver this. Figuring out who stays, who goes, what are we building.
Sam: Fascinating. I wish I could be a fly on the wall in that war room.
Shaan: I think it would be awesome.
Sam: My point of view has always been very simple: all the things he complains about are things power users would be annoyed at on Twitter — bots, verification, the algorithm not serving the right tweets. The problem is Twitter only has like 300 million users, it’s five times smaller than the other big social services, and it doesn’t really grow. My mom doesn’t use Twitter because there are too many bots. That’s not her problem. She just doesn’t see value in it. Whereas Instagram, WhatsApp, Snapchat — they’ve all given her a reason she needs it. She needs Snapchat if she wants to see pictures of her kids. She needs Instagram to keep up with Bollywood or whatever. Everybody finds a need in the service. That’s the core problem with Twitter — the core need it addresses is only for people like us.
Halloween Origins and the $10 Billion Holiday [00:19:00]
Sam: Happy Halloween, dude.
Shaan: You too. Since I’m not 12, I don’t dress up.
Sam: Shots fired at producer Ben.
Shaan: I just don’t understand why people are so obsessed with Halloween. To me it seems like — when your wife was buying a wedding dress, were you like, “You’re spending all this money for something you’re literally going to wear for three hours in your entire life”? That’s how I feel about Halloween. It’s a lot of work for a few hours.
Sam: Bro, you probably bought a giant sled to do sled pushes in your backyard. You’ve got some ridiculous purchase up your sleeve.
Shaan: I have a sled. But speaking of Halloween, I did a bunch of research and I wanted to rant about it to you.
Sam: I went down this rabbit hole and I saw some footprints on the way in. I was like, “I think that’s Sam’s size 11.”
Shaan: Let me tell you some things I found. First and foremost: what the heck is Halloween? Because today Halloween is this family neighborhood thing — young kids going out for candy, older kids dressing up. People are spending $10 billion a year on Halloween. That’s more than almost any other holiday except Christmas, which is off the charts at almost a trillion dollars.
So I was like, what the heck is this holiday? Who made this up? First of all, it’s like some part of the Celtic calendar. There was this festival where they’d dress up as demons to ward off demons — “Hey, we’re already here.” Pretty weak logic.
Then the Pope says something. November 1st is the Day of the Saints. We celebrated that every year in Catholic school. So the 31st became All Hallows’ Eve. Then how did it go from that to kids dressing up as Aladdin and going trick-or-treating?
For a while it was this more adult, dark holiday. Nobody was really spending much money on it. And then over time it got commercialized. The best explanation I found was that people wanted a holiday, it was a good excuse to celebrate, it could be community and family-oriented. And then retailers — the biggest winner from Halloween is Walmart. Walmart makes a killing: candy, costumes, decorations, everything.
Sam: And retailers needed to fill that dead period before the winter holidays. Sales always dipped, so they needed to invent an occasion. Same tactic as Valentine’s Day — the Hallmark lobby has been pushing that on us for years. Amazon is doing the same thing with Prime Day.
The Halloween Numbers [00:28:00]
Shaan: So here’s the breakdown. About $10 billion in spending — $3 billion on costumes, $700 million of that is pet costumes, which is kind of crazy, and around $3 billion on candy. Almost half the country gives out candy on Halloween. That is an insane level of adoption.
Sam: Walmart’s the biggest winner. They spend tens of millions in the week of Halloween just blasting ads. And so does everyone stocked inside: Skittles, Cheetos, Lunchables — everybody’s got a Halloween-themed thing.
Spirit Halloween: The Pop-Up Store Model [00:30:00]
Shaan: A couple of interesting finds when I was doing this research. First — a lot of people know about Spirit Halloween, but do you know the backstory of how it got started? Who owns it?
Sam: Spencers.
Shaan: That’s what I thought. Spencer’s also owns Spirit Halloween. So the way this started — it’s the ’80s in California. This guy owns a women’s clothing store. October is traditionally a super slow sales month. He’s sitting there not getting much sales. He looks around, and everybody’s struggling except one store. He sees this one Halloween store with a line out the door.
So he’s like, “Well, I’m not selling anything anyway,” and he turns three-fourths of his store into a Halloween store just for the month of October. Women’s clothes in a quarter of the store, Halloween stuff in the rest. And it works. So he does it again the next year. Then he’s like, “Forget my store. I’ll just open another store, just for the month.” And another one. That’s the model.
These guys go find vacant property — an empty box — and say, “Hey, landlord, you don’t have a lease. I’ll lease it for two months.” Landlords were initially resistant. So they pitched it: “If you don’t have a tenant by July, some revenue is better than no revenue.” Especially after the 2008 crash, that became a very enticing option.
They also have a kickout clause. They tell the landlord: if you find a long-term tenant, you can just kick us out anytime. A no-brainer proposition.
They now have 1,400 stores. Rewind to 2010 they had around 700. And total Halloween spend follows the same trend — $10 billion this year, $5 billion in 2010, $3 billion in 2005. More than doubled in our adult lifetime.
Christmas Tree Light Shows and Seasonal Business Risk [00:35:00]
Sam: I know a guy who owns a Christmas tree light show business. Whatever number you’re thinking of for revenue — times it by 20. We’re talking nine figures. You pay $20, you drive through a park with your family, and you look at light shows. He has a staff of over a hundred and they work all year for four weeks of actual operation.
Shaan: Can you imagine — if there’s like a terrorist attack, a covid, something happens during those two weeks, that’s it. Fifty weeks of work is ruined.
Sam: That is the risk with these seasonal businesses. Right now, on Halloween, his whole company is already working on next year’s Halloween — real estate, logistics, inventory, decorations, staffing. Everything to pop up the store for this month-long blitz. 90% of traffic comes in the two weeks before Halloween. Their whole proposition is to the procrastinator: “It’s too late to order online — just come into the store.”
Spirit does about a billion dollars a year in revenue. In basically a three-week window.
Rubies Costumes: The Supply Chain Fortune-Teller [00:41:00]
Shaan: Here are some other interesting businesses around this. So Rubies — have you heard of them?
Sam: No.
Shaan: Rubies is probably the biggest costume maker, or they were at a point in time. They started in New York doing decorations and costumes in the ’70s, when Halloween costumes were all ghosts and witches. Then in the ’70s and ’80s it shifted to Hollywood — movie and TV characters.
Rubies kind of fell behind because these other companies — Collegeville and Ben Cooper — got all the licenses. They were crushing it. Poor Rubies was just puttering along until something happened: the Tylenol cyanide poisoning scare. You know that story?
Sam: Tylenol packages got laced with cyanide. They never caught the person.
Shaan: A few people died and it scared everybody. So candy sales plummet. People are afraid to take candy from strangers. These costume and candy companies got a little over their skis because everything had been going great, and then they start to falter. Rubies ends up buying both Ben Cooper and Collegeville, consolidating all the licenses under one roof. Now they have Disney, Marvel, everyone.
And their biggest job isn’t design — it’s forecasting. They have to predict who is going to be popular next Halloween. Trump mask — is it going up or down? They work with all the studios. The studios give them sketch sheets: here are the movies coming out next year, here’s the hero, here’s the villain, here’s what the costumes look like. Under extreme lock and key, but huge money — the movie industry makes hundreds of millions off Halloween costume royalties, something like an 8-10% royalty.
Sam: I wonder what their research methodology is. It reminds me of that company WGSN — a $100 million a year business that does like $30 million in profit. All they do is help predict which color is going to be popular. Starbucks makes sure their labels are the right shade of pink. Apparently they predicted pineapples were going to be popular.
Shaan: Yeah, and they’re saying next year it’s the lemon.
Sam: I don’t even know how you would draw a lemon on an iPhone case. A round yellow thing — there’s just no density to it.
Shaan: So these guys basically have to be fortune-tellers. Through movies, politics — is it Pokémon? Is it Wonder Woman? Is it Trump? What is it going to be?
Haunted Houses as a Side Hustle [00:50:00]
Shaan: Haunted houses apparently do $300 million a year as an industry. Kind of crazy for something that’s only useful six days a year.
Sam: I’ve been. I’m not a big thrill-seeker — roller coasters, haunted houses — I don’t pay money to be scared. That’s my rule for movies and haunted houses. I’m pretty sure I should be getting paid if I’m getting scared. That’s my rule and I’m sticking to it.
Shaan: Somebody tweeted this local haunted house at me and I did the math. Same model as Spirit: take a vacant property, cut the owner a check for $10-15 grand, use it for the month. They have this operational playbook where they can just spin up the haunted house, charge $40 to enter. You do the math and they’re probably making half a million to a million dollars in about a month.
Zombie Pumpkins and the Pumpkin Stein [00:52:00]
Shaan: Let me give you some other ones. There’s a guy who created this site called Zombie Pumpkins. You ever seen it?
Sam: No.
Shaan: ZombiePumpkins.com. Two million people a year go to this site just to print out a stencil to carve their pumpkin. He makes like super accurately drawn things so you can have a really detailed pumpkin — like a Michael Jackson pumpkin that actually looks like it, if you follow his stencil. Two million people, most of those hits in the last week of October. He charges money for the stencils. Every year he releases new ones. And he donates a bunch of the money to charity.
Sam: Here’s another one: Pumpkin Steins. What if instead of carving a pumpkin, the pumpkin just grew into a decoration? Like, what if the pumpkin grew and already looked like Frankenstein?
That’s what this guy did. He’s some farmer somewhere and he spent four years trying to solve this problem. Tried growing a pumpkin into a mold, it didn’t work. Didn’t work. Finally the fourth year he got a pumpkin to grow into this mold that looks like a Frankenstein head.
He started selling them. A few hundred sales, then a few thousand. Retailers start coming to him. He opts to go with Sam’s Club. He was selling them for $100 a pumpkin, and he’s like, “You know what, at Sam’s Club volume I can sell them for $30 and still make money.” He got 90,000 orders last year — that’s like $4-5 million in sales.
He started going to other farms and paying them $11 per pumpkin to follow his blueprint. And then they had a malfunction where the face still looked right but the back got all screwed up — it looked like it exploded. And that was way more popular. People were like, “Oh that’s cool.” And he’s like, “Now I have to figure out how to do this intentionally.”
Shaan: These are amazing.
Home Depot’s 12-Foot Skeleton Goes Viral [00:57:00]
Sam: Have you heard about the Home Depot 12-foot skeleton?
Shaan: No.
Sam: My wife’s been talking about this. She’s like, “I really want to get the 12-foot skeleton, it’s always sold out.” I was like, “Let’s just go to Home Depot and get it.” She goes, “You don’t understand.” And she shows me Buy and Sell groups on Facebook where people are buying these things for a thousand dollars plus — they retail for like $300. Ebay, selling for a thousand.
It became such a hit that Home Depot figured out the giant lawn skeleton was the big hit. Then Lowe’s came out this year with the 12-foot mummy. And I was like, “Wow, you know who’s gonna come out with the 12-foot-one-inch ghost next year?”
It’s this crazy trend. All these things that weren’t categories before are becoming categories — inflatable lawn decorations, different types of candy, different types of costumes. It’s all surging because people are more and more willing to spend.
Shaan: I was thinking: why is Halloween so awesome? And I realized Halloween is the anti-holiday. It’s not cookie-cutter warm and fuzzy. It’s dark, more adult, more creative. It’s one of the few creative holidays. And social media is the boom for Halloween. Because what is social media? It’s a “hey, look at me” machine. And Halloween is the perfect “hey, look at me” moment — look at my house, my costume, my body, my kids. It’s also an excuse to act like a kid, and I’m bullish on anything that gives people an excuse to act like a kid. That’s why Burning Man is popular. That’s why Halloween is popular.
Sam: Dude, it feels like you prepared a whole debate on why Halloween is great. You have totally won me over.
Shaan: There’s a chance.
Christmas Lights Installation: A $20K Neighborhood Side Hustle [01:03:00]
Shaan: A little niche: we had a guy come rig up lights to our house this week. He did every single house in our neighborhood. We just moved in and our neighbor was like, “You want lights, you gotta hit the lights guy. He’s booked but he’ll try to squeeze you in.”
Sam: You are getting sucked into all the suburban traps. By the way, for the listener — I went to Shaan’s house for dinner the other day and I walked in and I saw a kids’ toy shopping cart with a checkout aisle. I’m like, “Oh, that says Target on it.” And one of you guys was like, “Yeah, this has been one of the most in-demand toys. We had to find this on eBay. We bought one and flipped the other.”
Shaan: Yeah, the moms wanted this cart.
Sam: You are totally becoming a suburban dad. I love this side of you. You know I have a fanny pack — I was equipped for this life.
Shaan: So this guy comes over and I’m like, “How much for the lights?” He’s like, “I’ll do it this morning. You get a one-hour window.” It’s $600 to put up lights, $200 for the lights themselves which last 10 years, and $60 to take them down in January.
Sam: $60 to take them down? Bro, once you put the lights up you could charge $6,000 to take them down. What am I gonna do? Where’s the gouging? You shouldn’t have even told me that price until January. You should have called me: “Hey dude, you need those down. It’s actually illegal to have those up here right now, you look like a redneck. It’s going to be $700.”
Shaan: He was too honest.
Sam: We were pretty redneck when I was young — we’d leave them up all year and call them party lights.
Shaan: They’re called “February lights.” Now they’re “March lights.”
Sam: I’m pretty sure this guy made like $20,000 this month in your one neighborhood with essentially zero cost. All he had to do was know how to string up lights — a skill that can definitely be learned. There’s a real neighborhood side hustle here. This is like a $10,000 to $20,000 opportunity. Flyer 100 houses in the area and start knocking on doors: “We just put up lights on your neighbor’s house. You guys want lights this year?”
The Spirit-for-Christmas Opportunity [01:09:00]
Shaan: Let me give you some ideas. You don’t like haunted houses — I get it. But: why is there no Spirit store for Christmas?
Sam: I don’t know.
Shaan: Spirit pops up for Halloween. What does Spirit do? Decorations, desserts, and — I’ll call it — “dang good gift ideas.” The three D’s of Spirit. Christmas has all three: decorations, specific desserts — eggnog, candy canes — and you need a place to go try out toys and gift ideas. Hallmark tries to capture this and I think they’re doing it wrong.
Spirit needs to pop up for Halloween, stick around for Thanksgiving and the Christmas push, then wind down right after Valentine’s Day. Six to eight months — that’s the Spirit you need.
Sam: And being CEO of the holiday company would be awesome. Are you changing the world? No. Are you having a blast? For sure. You’re in the season. What a beautiful word — the holidays. Which is completely underused.
Pet Costumes and HalloweenClassrooms.com [01:14:00]
Shaan: This pet costume thing is a real trend. We’ve seen pet vitamin companies like Zesty Paws sell for $600 million. Pets is a huge niche. Seven hundred million dollars a year is spent on pet costumes, and I can’t even tell you off the top of my head who the go-to brand for pet costumes is. That tells you there’s more than enough room on the e-commerce side.
The story behind HalloweenClassrooms.com is also crazy — same thing: somebody stumbled into the idea and couldn’t keep up with demand as Halloween grew. And now it’s huge.
Sam: All right, that’s my Halloween rant.
Shaan: Good one — solid breakdown and backstory.
VR Haunted House: The Software Opportunity [01:16:00]
Sam: Okay, some ideas. You don’t like haunted houses. Fine. But man — the effort to get out there. It’s gonna be cold. Gotta get the kids ready, get in the car, all that stuff. Why isn’t there a haunted house I can do from the seat of my chair at home?
VR haunted house. If you’ve ever put on a VR headset, there’s one thing VR is kind of amazing at: that immersive experience where you can look right, look left, and just get scared. Like the demo where you’re rock climbing and they say “look down” — it’s legit scary. They make your character start to slip and you get that feeling in your stomach.
VR haunted house, no brainer. I think there are a hundred VR apps that do over a million dollars a year. A VR haunted house app — you could sell it for $20 a pop and probably make a couple hundred thousand to a million dollars in a year just from the volume of sales in VR. And the Oculus store will feature you because you’re cool content for the month, so you get free promotion.
Shaan: I dig it.
Humane: The “Change Everything” Wearable [01:20:00]
Sam: There’s this company called Humane. Have you heard of it?
Shaan: The phone on your chest?
Sam: Yes. Basically they’ve raised $130 million from some of the best VCs out there. The founders are a husband and wife — the husband spent 20 years at Apple, was on the original small team that came up with the iPhone. His wife was a director of engineering at Apple. And they’ve recruited 100-plus employees, most from Apple — Apple Ballers, not entry-level people.
They filed for all these patents: a wearable multimedia device and cloud computing platform with laser projections, a portable battery pack. They don’t even have a website, really. You go there — you have to commit three typos to get there. The URL is like q.hmn.md. You get there and it’s a picture of the sun and it just says, “Change everything.”
Shaan: I have a strong take.
Sam: Their whole point is they view phones as a divider between us and the world. They want your phone — or whatever replaces the phone — to be an extension of your body. So like clothes you wear, or lenses in your eyes. I’m not exactly sure.
Shaan: Two things. One, I completely agree — as an industry we’re way too early to say there’s something actionable right now, but in like 10-20 years we’re going to be anti-phone. We’re going to be like, “What the hell were you doing looking at that thing? That’s cancer. Why are you doing that?” Kind of like how we now look at smoking.
Two — I’m sure Bethany and Imran are wonderful people, but I think any company that raises that much money, has a site that says “Change everything,” and has never shown anything — nine times out of ten they fail. It’s the hubris that kills them.
Sam: What’s one that didn’t fail?
Shaan: Jet.com. Mark Lorie, friend of the pod, love the guy, owns an NBA team. It worked. But it did seem like the team and the technology got acquired by Walmart more than the underlying consumer business.
Quibi was the most recent one that had this setup. Failed. Magic Leap before that — failing in progress.
Sam: So I do remember when the patent got leaked. At that time the device looked like some kind of clip-on camera you’d wear on your chest. Like a GoPro, but for your everyday life.
Shaan: Right. That would only be to capture — you couldn’t look at it and read something or watch video. It wouldn’t fully replace the phone.
I’ll say this: they’re solving the right problem. The phone is not the last device. There’s going to be some wearable after this. Is it glasses? Is it this? Is it a drone floating above your head? Most likely it’ll be glasses — that’s where everyone is heading. And it will happen and it will change the world when whoever gets that form factor right.
The phone really is causing damage. I went to a doctor and he did a scan. He’s like, “You’ve got a slight thing at C4, C5.” I’m like, “What did I do?” He goes, “Oh no, everybody has this now. It’s from looking at the phone. It’s the most chronic problem in the country right now — necks are messed up from being constantly craned down.” And I was like, “Damn. I gotta start raising my phone higher.”
Sam: And he sells selfie sticks.
Shaan: So I think they’re solving the right problem. But once you get this cute-ass domain, raise $100 million, go into stealth, hire a hundred people, and say “We’re gonna change the world” — you’re basically walking off a cliff. Like, hey Magic Leap, I can see you down there.
Sam: I don’t think it’s gonna work, but I think it’s a cool move. I’m glad they’re doing it.
Shaan: It’s like face tattoos. What do you say?
Zuckerberg’s Law and the Future of Sharing [01:36:00]
Shaan: Zuckerberg has this law — he said it one time in an interview and never said it again because it sounds bad. He coined it “Zuckerberg’s Law”: every year people are willing to share up to twice as much as they were the year before. We weren’t sharing status updates, then Twitter came out. We weren’t sharing location, then Foursquare came out. Photos — we weren’t sharing online, then we shared albums, then single photos, then with Snapchat we share tons because they disappear.
As long as a product can unlock that pent-up demand to share twice as much as you’re currently sharing — it works. And I feel this all the time. There are so many moments in the day that I wish I’d captured but I can’t, because my hands aren’t on a keyboard. My kids did something cute. My trainer said something awesome in a workout.
There is a big pent-up demand to capture more moments and share some portion of them. That will happen with either glasses, a drone camera, or a wearable on your chest.
Suli’s Twitter Thread: Buying a $1M App and Retiring at 31 [01:41:00]
Sam: He tells this story. He goes, when he sold his company TinyCo — a mobile gaming company — there were two parts: the original games they’d been making, like Tiny Monsters and Tiny Zoo, and their licensed games, like the Family Guy game, Harry Potter, Marvel. When they got acquired, the buyers really wanted the licensed IP games. So after the acquisition they decided to sell the originals.
There were a bunch of potential acquirers. One offered $500K. He thought that was a good offer but he could get more, so he created a new bidder. He hit up a former engineer from TinyCo and told him to bid. He said: “You’re gonna need to offer about a million dollars — twice the current offer — because you’re just some random guy.” The engineer did it. More than market price. He won the bid.
Shaan: Congratulations! All right — now here’s the deal. You’ve underinvested in these games. You’ve got to work 60 hours a week, put money into ads to grow it, add features to improve retention, and you’ll 3-4x revenue in the next 12 months.
Sam: And the guy sat there and said, “I’ve got a better idea.” He’s working as an engineer at this company. He’s like, “I’m just gonna quit. And instead of doing more work, I’m going to do the absolute minimum to keep this thing refreshed and working.” He goes, “I’m just gonna tap out of the workforce at age 31. I’m gonna live within my means. This app I just bought for a million dollars is going to keep giving me cash flow forever. I don’t need a job anymore. I’ll maintain it so it keeps the cash flow coming. In the meantime I’ll work on hobby projects and other software things that scratch my itch.”
Shaan: And then the world started working in his favor on top of that. The Epic vs. Apple lawsuit made Apple change their rev-share deal — for anybody making less than a million in revenue, they’d take a 15% cut instead of 30%. So immediately his profit went up 15%. The business generated more than $3 million in profit since he bought it. The purchase price assumed revenue would go down over time, but it remained steady and actually grew during COVID.
His takeaway: “The only way to win the rat race is to opt out.” And then he says: “I understand this intellectually, but I have not accepted it emotionally. Frankly I’m still blown away by my friend’s act of saying, ‘Yeah, I have enough.’”
Sam: And then the self-serving part of the thread: “I want to buy one of these. I think these little businesses don’t have enough value ascribed to them.” And by the way, he didn’t put down the full million in cash — he financed it. Maybe put down $300-400K and financed the rest.
Shaan: Would you ever do that? Could you see yourself tapping out?
Sam: I think about that all the time. Not tapping out forever, but I feel this urge to work on whatever the most creative, fun project is — which might make zero dollars or negative dollars. But don’t you do that now in a way? That’s how I started this podcast. My plan when I started was: I’ll probably lose $10K a year all-in on production. Paying my editor a couple hundred bucks a month, booking the studio four times a month — I was like, “I’ll probably net lose $10K. I’ll have some sponsors but net lose $10K.” I was totally happy with that because I thought the project was gonna be a lot of fun.
Instead of starting a new business, I started this podcast. And it turned out to be my favorite thing I’ve ever done — the best project I’ve ever started. And actually turned out to be a pretty good business too. I kind of want to do that again. Go look at something I’d be willing to lose money doing because it’s that fun, because I think that’s a better signal of what I really want to do.
Shaan: I think a lot of people dream about retiring. A few times in my career I’ve taken as much as a month off — a sabbatical. And every single time I love it at first and at the end I’m like, “Dude, I gotta go do something.” Your friends can’t hang out with you on a Wednesday at 1pm. You’re just bored. You’re like, “I need to go create, I need to produce.” I realize I am not built to sit idle.
Men — and probably all people — are not built to sit idle. I think we’re created to work, maybe not 100 hours a week but like 30 hours a week at minimum. You just have to produce and contribute, otherwise you feel pointless. And I think you die sooner.
My family sometimes says, “I’m gonna retire.” And I’m like, “I don’t think you should retire. I think you should work a little less, or take a six-month vacation. But if you retire too early you’re literally just taking four years off your life.” At a minimum, go volunteer. Contribute in some capacity. Have something you’re living for.
Sam: I wouldn’t take a sabbatical. I would pour my energy into a more creative project that isn’t the best business use of time. I have a bunch of ideas that could make a bunch of money and then a bunch of ideas that would be really fun but probably wouldn’t make any money. Might not get anybody to use it. Might turn out crappy. But I’m intrigued to do it. And the problem is all the things I want to do cost money. So I’m like, “I need to earn more.”
Shaan: Perception is reality. Just change that.
Sam: Yeah. All right, I gotta run.
Shaan: Good episode.
Sam: All right, that’s a wrap.