This episode of the My First Million podcast features a deep dive into the fascinating and tragic life of tech entrepreneur Mike Lynch, often referred to as the “British Bill Gates.” The hosts explore his humble beginnings, his massive success with the company Autonomy, and the bizarre, high-stakes legal and personal events that defined his later years.
Topics: Mike Lynch, Autonomy, HP acquisition, entrepreneurship, business ethics, legal battles, tech history, philosophy, life design.
The Wild Story of Mike Lynch [00:00]
Sam Parr: Well, I have a different billionaire story that’s kind of crazy that I want to tell you about. So, check this out. This is, this is a wild story. I’m just going to brace yourself.
Okay, let’s start with this. I’m going to read you a snippet from an article first. So, in July, in early 2022, the court ruled that this person, Mike Lynch, owed 4 billion in damages that are still pending. Okay, so court rules that Mike Lynch owes 4 billion dollars. Next line. At the same time, the US tried to extradite Lynch. He was in the UK. The US says, “No, no, no, we’re going to come try you over here.” They bring him over, and he arrives in San Francisco in May of 2023, and he’s released on a 100 million dollar bail and consigned to house arrest in a rental home with cameras installed in every room, two armed guards on duty on duty around the clock.
Now, what’s interesting about this is that that rental home with cameras installed in every room and armed guards on duty around the clock is my dad’s house. I don’t know if you know this. That guy stayed at my dad’s Airbnb when he was on trial.
Shaan Puri: Your dad owns an airb- like a home in SF?
Sam Parr: My dad’s actual house, he’ll Airbnb out for periods of time. He’ll go, if he gets a booking that’s like, you know, at the right price point, they’ll go get to, he’ll go to like a motel, in a hotel like in, you know, Fremont or something like that, go stay there for the night, and then he’ll be like so happy that he made some money. But my dad didn’t know this. He gets a booking, he’s like, “Man, this guy wants, uh, this guy just booked three months.” And three months, by the way, is the max you can even do when you’re Airbnbing your own house in San Francisco. It’s like that, you have 90 days. So he’s like, “Wow, I got the whole year from one guy. This is great.”
So he’s like, “Where am I going to go for three months?” And he’s figuring it out, “Oh, I’ll go travel, whatever.” And then he texts me and he’s like, “Hey, can you check the Ring camera real quick?” And I check the Ring, and there’s these bodyguards standing outside the house.
Shaan Puri: What? What’s going on?
Sam Parr: And so he texts the guy, and he’s like, “Hey Mike, hope you got into the house okay from the lockbox. Curious, what are these guards doing outside the house?” And he says, “Oh, I’m actually on house arrest. I’m awaiting my trial, and for the duration of this, I can’t leave the house.”
You know, that’s why I wanted your Airbnb. You have this nice backyard. Hard to get a nice backyard in San Francisco. So, and my dad’s like, “What the hell?” So he starts Googling the case. We all start Googling the case, and this guy’s story is fascinating.
The British Bill Gates [02:27]
Shaan Puri: And is this for autonomy?
Sam Parr: Yeah, so I’ll give you the end of the story, which is, which is kind of interesting, right? I don’t know if you’ve, have you heard the latest update on this?
Shaan Puri: No, but not the latest, but I know that it’s weird. There’s a lot of weird stuff going on.
Sam Parr: So, I’ll, I’ll start with the end and then we’ll go back to the beginning. The end of the story is, at some point my dad’s like, “Hey, I got to go back to live in my house. Your trial’s not over.” The guy’s like, “Okay, okay, I’ll ask the judge if I can move Airbnb.” So he moves Airbnbs. He finishes the trial. He’s acquitted on all charges. He’s a free man. To celebrate, him, his family, his lawyers, they all get on a yacht. He owns this 30 million dollar yacht, and this person that he used to work with, a guy who was his character witness, his lawyer, his wife, the lawyer’s wife, they all get on this boat, and they start sailing.
And mysteriously, two months after, uh, being acquitted of all charges, there’s a freak yacht accident, and he dies. He’s killed on this boat.
Shaan Puri: Oh.
Sam Parr: At the same time, 48 hours later, the other guy in the case, his co-founder, who was also acquitted on the same day of all the charges, is going for a run and gets hit by a car and also dies. And so it’s kind of strange that this guy who was in this multi-billion dollar fraud suit, the day, you know, 48 hours, um, apart, just a couple months after being acquitted, him and the co-founder are both killed in freak accidents.
Shaan Puri: Yeah.
Sam Parr: All right. So now let’s go back to the beginning. I Googled this guy. So this guy’s story is actually pretty fascinating. He is called the British Bill Gates. And the reason he’s called the British Bill Gates is that this guy was brilliant. So he grew up super poor. Basically, he’s, uh, he’s so poor, but he’s, uh, he’s a hard worker, he’s smart, and he ends up getting a scholarship to go to school because he, and he said this, he goes, “There was a guy, like a, a, a lord in the 1600s, who when he died, he left his wealth specifically for one purpose: for the education of poor boys.” And he’s like, “I’m a, I was a poor boy, and I got to have this scholarship which let me go to a school.”
And so when he’s 11, he gets into a private school, he starts working really hard. At 16, he becomes a janitor at a hospital, and he’s mopping the floors. And during the trial, he’s talking about his, his childhood or growing up, and he’s, he’s like, “At 16, I used to work in this hospital mopping the floors. I was, I was, and actually I still am, a, I’m a demon mopper. So I could do that.” And the lawyer goes, “Your credibility is on the line here, Dr. Lynch.” And he goes, “Throw me a mop. I’ll show you right now.” And the whole, uh, audience at the, at the courthouse starts laughing.
He tells a story at the, at the hospital, he’s working his way up. So he goes from janitor mopping the floors to porter, which he’s, he’s wheeling the people from room to room, he’s moving the beds around. Finally, he gets the prestigious job of serving tea and sandwiches. And he says, “This is the most important thing that happened in my life was, at age 16, I spent a lot of time with people who were 95 year old, basically people on the way out, and I used to sit with them and I used to serve them tea and sandwiches, and these people had nobody to talk to, and they were at the end of their life, and they opened up to me about their life and about things that they’ve never told anybody.”
And he goes, “At 16, I thought that life is, I’m indestructible, and life, you know, life seems like it’s forever when you’re 16.” He’s like, “Every day I was reminded, life is really short. I want to really make something of my life.”
Then he says, I get, he gets into Cambridge. He goes into Cambridge and he gets a PhD, um, in neural networks, artificial intelligence and neural networks. And this is, he’s a, this is, this is way before AI and neural networks were a thing. So let’s fast forward. He starts this company called Autonomy. And Autonomy was basically like one of these, like machine learning, big data, take, take a bunch of data, find patterns that the human eye is not going to be able to see, and they sell this to both companies as well as governments and agencies, sort of like a Palantir-esque company.
So he, um, starts this company, he ends up selling it to HP for 11 billion dollars. So Hewlett Packard, who’s like a hardware company, wants to go to software, and they get really hot and heavy, and they, the company was already public, but they offered a 60% premium. So they said, “We’ll give you 60% more than your stock price to take this deal.” He says, “All right.” You know, he’s like, “If I had not taken that deal, my shareholders would have been, you know, they would have sounded like a herd of elephants stampeding towards me. Why didn’t you take this deal?” So of course I took the deal.
It takes the deal, a couple years later, HP ends up writing off eight and a half billion dollars of that acquisition, and they say, “You guys cooked the books.” So you, um, you inflated your revenues, your profits, your balance sheet. Um, so they sue him. And in the suit, there are a couple things happened. The, the CFO pleads guilty for wire fraud, so he’s in jail for, I don’t know, five, seven years, something like that. Um, the, the co-founder volunteers to work with them, and he gets a pretty light sentence. And this guy Mike avoids, he tries to avoid being in court with these guys. So he’s trying to avoid extradition, all this stuff for like a period of time. Finally, they get him.
The “He Said, She Said” of the Courtroom [07:13]
Shaan Puri: And what’s like the, what’s the “he said, she said”? Like, uh, so HP says, “Your revenue wasn’t what what it really was, or you billed people wrong.” What what’s?
Sam Parr: It’s a very complicated thing. So they said that, “Hey, you misrepresented your revenues and the profitability profile of this business and something on the balance sheet.” The “he said, she said” said, during the court case, they asked him about this, and he says, “If you take a microscope into any kitchen, even the cleanest ones, you will find bacteria.”
Shaan Puri: Okay.
Sam Parr: Which is, great analogy, but the most guilty shit I’ve ever heard, to be honest. So, that sounds horrible. So I don’t know all the details. At the, at during the court case, they had 15 million financial documents that they had submitted as exhibits, and it was so complicated that during this case, one juror kept falling asleep, and the lawyer looks over at him and he goes, “I know this is not fascinating, but you got to tell me, can you stay awake for the next eight weeks of this trial?” Um, the juror goes, “That’s a negative. I can’t.”
And so he ends up getting acquitted, which is, uh, amazing. And by the way, him testifying and telling that story about him and the janitor and the, they think it helped him, and it was very rare. Most people do not testify for their own defense. They tell you, don’t, don’t go on the stand.
Shaan Puri: So basically he, he has charisma.
Sam Parr: He has some charisma, exactly. So he gets on the stage, anyways, he gets acquitted. Um, now this, this death has all these weird circumstances. So, at first when I heard this, it just sounded like some real Epstein stuff, right? It was like, “Wait, these two people get acquitted on the fraud case and then both die within, you know, 48 hours of each other in these quote-unquote freak accidents?”
Shaan Puri: Yeah, and like the accident that they described it was like basically, I if if I remember correctly, like a water tornado. They’re like, he was sailing and there was like a tornado that like tipped over this huge sailboat.
Sam Parr: Well, the crazy thing is, yeah, so then you read about it. So I’m, this is me last night, just swaying as I’m reading the details of this case. So, on one hand, okay, it sounded like he got killed. No, he didn’t get killed. The boat sank, and the boat sank due to this like natural disaster. Okay, that sounds pretty. What what are you going to say? Somebody caused a water tornado?
Shaan Puri: And a bunch of people survived it.
Sam Parr: And people survived it, exactly. So he could have just as easily survived. On the other hand, there’s stuff that came out that was like, uh, they didn’t secure like the sort of the the the ship in the right way as you would when you have that forecast. So like why didn’t they do that? That’s a little bit strange. Also, the guy who got hit by the car, the other guy running, for it to happen in that time span and they and the lady who hit him, she’s this 49-year-old woman, um, who hit him with the car, she was like, “I couldn’t see.” And it was like, “Wow, okay, she’s cooperating with the authorities. She doesn’t look like a hitman.”
And then if you go into the subreddit, the are, you know, the conspiracy subreddits, it’s like, of course they made it look like that. That’s exactly how this works. They make it look, they look for a weather pattern that could be, uh, could be believed and then they’ll sink the boat and then you it seems like the boat sank due to natural disaster or they find these people who don’t look like hitman but they’re hitman. It’s like, all right, I don’t know what to believe in all this.
The Business Monetization Playbook [10:20]
Sam Parr: All right, so when I ran my company, The Hustle, I think we had something like 2 million subscribers, and we made money through advertising. And we didn’t actually make that much money per person reading the newsletter because advertising in general is kind of a crappy business model. And so I remember sitting down and I’m like, “What are all the different ways that I can make money off The Hustle that aren’t advertising?”
And so, to make sure that you don’t make this mistake, Sean, me, and the HubSpot team, we went and looked at a bunch of different ways to monetize your business, and we put it all together in a really cool document where we laid it all out along with our research, and we call it, very appropriately, we called it The Business Monetization Playbook. Go to the description of this episode and you’re going to see a link to that, uh, Business Monetization Playbook. It’s completely free. You just click the link and you can see it. Back to the episode.
Dark Trace and the Conspiracy [11:08]
Sam Parr: Conspiracy aside, incredibly wild story that this is how this all played out. And by the way, during this time, so he sells Autonomy in 2011, something like that. 2013, he starts a new company, Dark Trace. And Dark Trace is this cybersecurity company that, this, this name does not help this whole conspiracy.
Shaan Puri: That’s what I’m saying. That there’s, there’s more to it. So, if you look up what Dark Trace does, Dark Trace, I think was started back when WikiLeaks happened, and the idea was, we’re going to go to like government agencies, and when Snowden and the WikiLeaks stuff started happening, it was basically, “I’ll make sure WikiLeaks and the Snowden leaks never happen to you.” And so they were working with all kinds of, you know, secret agencies to try to prevent, uh, that from being possible. And that’s what Dark Trace is. Dark Trace was also a 5 billion dollar company that was acquired, was acquired for 5 billion dollars. And so this guy was like really prolific as an entrepreneur, um, at the same time, this incredible, you know, either tragedy, conspiracy, or freak accident, it’s hard to say, but isn’t that wild that this guy was just living in my dad’s house?
Shaan Puri: How much is your dad, okay, uh, I don’t know. The answer of this could be, I don’t want to give too much information about my father, but let’s just presume that this guy Mike Lynch is worth billions. How much do you think he was paying per month for, uh, So that’s actually a funny thing. So my dad’s normal rate, I think the normal rate on his Airbnb is like 750 bucks a night, something like that. Um, which is it’s a house with multiple rooms, so it’s like it’s cheaper than it would be if you were, uh, if you’re a group. And by the way, my dad’s super desperate, so he’ll, he’ll put it up for 750. Someone comes in for five, he’s like, “Ah, it’s still five. Five is great. Uh, you know, that’s it’s a lot of money. I got to say yes to this.” And we’re always telling him, we’re like, “Dude, like, you’re like, you’re old now. Don’t inconvenience your life like this.” And he’s, he’ll do it, whatever.
So when this happened, of course, my first instinct is, “Hey, maybe you don’t want whatever’s, this seems like a pretty tense situation. We don’t know, we don’t have a lot of information here. There’s somebody who’s like, you know, on trial, it’s like a criminal living in your house. What’s going on? Maybe you should ask him to leave.” And my dad’s like, “Yeah, yeah, yeah, going to do that.” Calls the guy, calls me back, like, “So what happened? Is he agreed to leave? Uh, like, are you going to have to refund him or what?” He’s like, “No, he’s paying triple now.” And I was like, “What?” And he my dad’s like, “Yeah, I was going to ask him to leave, and then I just told him, like, this is really stressing me out, like, uh, I don’t know what to do. Can you just, like, this is going to cost more.” And he’s like, “Sure, what do you want?” And he’s like, “How about triple?” And he’s like, “Okay, no problem.” So my dad was over the moon about this whole situation.
Shaan Puri: Dude, that’s the most Indian thing I’ve ever heard.
Sam Parr: That’s first of all, that’s insane. By the way, uh, I have a friend who just rented out their home for a Netflix show, and they were spent, they, the home was worth like 5 million dollars, and the Netflix crew to be there and all this, they were spending, I believe, 200,000 dollars a month. That was the rental price for three months. Uh, which it’s like freaking insane. And so your dad was almost getting Yeah, he was getting that reality TV money, and it was just one guy sitting in the house all day. It’s kind of amazing.
Shaan Puri: Wow. First of all, there’s so many there’s so many weird things uh about the story. When when you looked into it, what do you think happened?
Sam Parr: Well, I was I was, I’m telling you, I was really thinking conspiracy, and then I go into the subreddit, and the top comment was so funny. It goes, “I’m sorry, but if Hewlett Packard arranged the hit, they’d still be waiting for the correct driver to be installed.”
Shaan Puri: I was like, “Oh, that’s true.” This HP is not ordering a hit. I don’t I don’t believe that’s the case.
Shaan Puri: I have studied history for a long time. I’m into all this stuff. Conspiracy theories are always fun to read about. Here’s my takeaway with conspiracies. One, they do exist sometimes. So, for example, do you remember the O.J. Simpson trial and how there was Mark Fuhrman, he was the uh one of these police officers who planted the glove there. Yeah, that is that’s an example of a conspiracy that I believe like was true. The problem with conspiracies, there’s two problems with them. One, secrets are really hard to keep. You know what I mean? Like if so if 50 people know that they had to work together to do X, Y, and Z, it’s really hard, particularly over decades, to keep that a secret. You know what I mean? That’s that’s a that’s a huge challenge. And the second thing is that when you have to hire people to do these things, they’re typically lower income. For example, someone who works at a security as a security prisoner or um a corrections uh facility, they’re probably like they don’t have that many options, they don’t make a lot of money, and convincing this person to shut up for 50 years, that’s really fucking hard. It’s just it’s like logistically to pull off a conspiracy like that is effective, it’s really, really hard. Or like let’s say you’re doing it with like a bunch of military people, so like 100 just infantry people are trying you think they’re going to be able to keep their mouth shut? It’s just challenging.
Sam Parr: But it it does happen. And also with like, for example, the Epstein thing, it’s like, “Oh, and then the cameras stopped working that day.” It’s like, “All right, this seems extremely suspect.” It’s like the guards happened to leave and the cameras shut off and he got his hands on a rope or whatever. I don’t know the details, but like some of these, they make you, they make you do this, the the goatee pinch. Huh, what’s going on here?
Shaan Puri: Well, and then but there’s there’s a lot of times there’s Have you heard of the Kennedy curse about how they all die?
Sam Parr: No.
Shaan Puri: Uh, you know, there’s like Joe Kennedy was the patriarch, he had nine kids and roughly six of them died, and then like the grandkids, they all died. Like died early, you mean? Died early. Yeah, for example, assassinations, died in plane crashes. And then you like look at like the story of each one and you’re like, “Oh, this isn’t a curse. You guys are just risk takers.” Like this guy was flying a plane when he just got his pilot’s license and he was flying like a jet when he should have been flying like a much slower plane. Or this person, um, he got assassinated because he was president and like 10% of all presidents have been assassinated have been assassinated. You know what I mean? Like there’s like there’s often times there’s a story where uh it like each one individually can kind of make sense, but added up together, it may seem too good to be true. But they’re actually things make sense when you look down. So anyway, that’s my opinion on conspiracies. But this story is so fascinating. I I remember reading about Mike Lynch and this is a crazy state at your dad’s house and B, I I also I kind of don’t know how I feel about the story. I don’t know what happened.
Sam Parr: Yeah, neither do I. And by the way, for conspiracies, I it’s like uh for most things in life, you just either choose to believe or you choose not to believe, right? It’s a choice whether you believe in something. And some things when you choose to believe them, they make believe in them like luck. Like I I’m a lucky person. I believe that. Because I believe that, I’m going to do different things than somebody who believes they’re an unlucky person will do. And so it’s actually less important to figure out what’s true and what’s not as it is to figure out what’s useful to believe and what’s not useful to believe in life. And so some things like for example, conspiracies are useful to believe only for their entertainment value, more so than anything else. Or to say, “I’m not going to take everything at face value.” I understand that there is an just like there is an error rate in every uh prediction or poll, just like there’s an error rate in every scientific process, there is a conspiracy rate in every, you know, series of historical events where some number between, you know, 0.1 and 5% of all things that have a conspiracy are actually true. So choosing to believe for entertainment value is kind of where I land on it.
Shaan Puri: Single engine airplanes or helicopters and boats like huge yachts, two things, I I don’t touch them. I think those things are so I’m so afraid of those things. Have you ever been on a cruise? Like a big ship? Like it’s like it’s it’s frightening. Do you know how many people die on cruises every year? Like a huge amount because they jump off like, you know what I mean? Like they they get lost at sea. They jump off? Oh, like they’re just going for a swim? Yeah, or they’re or they’re drunk and they fall over the side. Like there’s like this website called like missing at sea, I forget what it was. And it was like all the people who go missing from cruise ships every year. It’s like a it’s like it’s like a it’s a huge number. Like the dead version of Facebook. It’s like this group of people that are missing at sea. Yeah, it’s like a pretty disgusting thing. I’m not doing that. I I can’t stand cruises. So, but this this story is pretty wild. This is this is a wild story. That’s wild he stayed at your dad’s place.
Sam Parr: All right, where do we want to go from here?
Shaan Puri: All right. So for the last 15 years, you and I have studied like making money. Would you agree? Like that’s been like the 90% of our waking time.
Sam Parr: I have agreed. I would agree with that.
Shaan Puri: That’s cool. That’s great and everything. But um I think that I have kind of have I’ve learned how to do it. Would you agree that you kind of understand like intellectually how it’s done?
Sam Parr: I understand intellectually, yes.
Shaan Puri: Like it it’s it’s hard, but Well, there’s like three phases. There’s understanding intellectually, realizing you thought you understood intellectually, and then now you actually know intellectually, and then there’s doing it. And I think I finally got past the third stage. And now I think the fourth stage is either is being done with it, being getting over it, or being less interested in it as you go.
Shaan Puri: Yeah, for sure. Which by the way, like uh I I actually think that that’s a great like arc. And something that like I’ve always loved about studying making money is the idea of nothing to something. And it just so happened that capitalism and making money, that is a very practical way of nothing to something. Like it’s a very straightforward way. Uh and and we’ve studied it. A new thing that I’m being a little bit obsessed with about how someone goes from nothing to something is politics. And not that like I actually care, I don’t ever want to like become political. I don’t want to become the president.
Sam Parr: We’re pivoting to the all-in podcast.
Shaan Puri: No, I I don’t want to do any of that. It doesn’t actually interest interest me. But like when Trump became president, I was like, “You know, isn’t that insane that like in his head, I think he was like, this is just like a bit.” And then it but it kind of like came to fruition that like you like became powerful and I’m like, “That’s like insane how that happens, how someone goes from nothing to something, particularly in the political arena.” And so I moved to this small town and I thought, uh, you know, like it’s only a 30,000 person town. I’m going to email the mayor and I just want to become friends with her and just like learn about how she became mayor. So I I emailed her and uh I just said like, “Hey, my name’s Sam. Um, I’m I have this podcast, I have this internet company that I started, and I’m basically just saying this to impress you, but can I come in and just introduce myself?” And she did. She said, “Yeah.” And so I met went met with her. And I thought it’d be funny. I I could just like do a little recap of this meeting. But I said a few things that I look back and I’m like, “What the hell? Why would I ever say that?”
Sam Parr: Set the scene. You go to her office, you guys go out to lunch, you go for a stroll. What are you doing?
Shaan Puri: She’s like, uh, you know, come over, we we’ll go out to lunch. I’m like, “No, I don’t want to go for lunch. I want to like come to your office. Like I want to see like I want to see what the sausage is made, my friend. Like I want to see it.” So I get there at like 8:45, she’s walking in right about then for our 9:00, so we just start talking. We sit down, she’s nice. Her name’s uh Jennifer Tucher. Uh she introduced herself as Jen. So I guess I’ll I’ll call her that. Or friends now. And uh I just start talking to her and I kind of got nervous, you know? Like I I got Did you ever have to do a thing where you get married and you have to meet like with the priest in advance? Yeah. And you’re like, “Wait, can this guy cancel our marriage right now if I say the wrong thing?”
Sam Parr: I I it was the exact same thing. The guy’s like, “Do you guys go to church?” And I’m like, “Dude, I go to church like every day, easily, every day.” Uh, you know what I mean? I had that like same energy where I’m like Favorite part of the Bible? Oh, so many to choose from. It’s hard, yeah. Uh, and it was like the same thing where I’m like, “Dude, I just want to impress her.” But I I’ve said it, she was like, “How do you like the town?” And I was like, “You know, Warren Buffett says this amazing thing where he’s like, ‘You got to build a business so good that uh a dummy can run it, because eventually a dummy will.’” I kind of feel like this town is like that. Like it’s so perfect. Like there’s nothing to complain and like any idiot can run it. And I was like, “Shit, uh, not that you’re an idiot, it’s just, you know what I mean?” And so Wait, you said that or she said that? I said that. I said that. Wait, you said the Buffett quote about an idiot running it or she said it? Yes. Yes.
Sam Parr: And I was like, “Wait, I’m like, wait, I’m sorry. I didn’t I was like, I meant this in a nice way. The town is like perfect. Like there’s nothing to complain about.” And she starts telling stories about that and I’m like, “It seems like if you work for Warren Buffett as an executive, like you must have been like pretty rich. Uh, why would you quit that and take this crappy job?” And she like, like again, kind of like laughed. But like I was saying things that 10 seconds after I said it, I’m like, “What am I doing right now?” And she laughed at all of them. And so it was really kind of funny to like see like my first interaction went just horribly, but she was into it.
Sam Parr: You remind me, um, before you finish your story, so my daughter, uh, is she just turned five, so she’s she just started going to school for the first time. Like she’s going to to to TK, transitional kindergarten. And as a parent, you’re like helpless because you don’t know what your kids like, you kind of give her advice, but then she crosses the gate, she goes into the class and you’re like, “Remember, like, make friends, ask people questions, they like that.” And like, you know, I’m trying to give her a way to socialize because she’s smart. She’s fine in the school part, but at the beginning she was super uncomfortable with kids and she started to do, and so, but I didn’t know. As a parent, you never really know how they’re behaving. And so we would run into these scenarios, we’d be at a coffee shop and then there’s a kid who would be like, “Hi,” and like say her name. I’m like, “Oh, do you know him? Is that like a kid from your school?” And I get really excited and then she would do what you just did, which is she would just suddenly start saying and doing the funniest things. Like we’ll be standing there and I’ll be like, like she won’t say anything at first. I’m like, “Say something. Is he in your class? Yeah, okay. Like who’s this kid?” And then I’ll be like, “Hey, I like your watch, like your shoes, man. Spider-Man, cool.” And then she’s not saying anything and then she’ll just go, “Why am I so tired?” And then she goes, “I need to go to sleep.” And then she laid down on the sidewalk and like pretended to go to sleep in front of me and now I’m just talking to this kid. And so this happened three different times with three different kids. “Why am I so tired?” And she just would say this thing out of nowhere. It’s like a panic response. And I feel like you just had your panic response in front of the mayor where you’re like, “Warren Buffett says, and you just paroted some shitty Buffett quote.” Yeah, I’m like, I don’t even like Buffett. What am I, why am I bringing this up? And I just called her an idiot. Like you taking an exit off the highway and you’re like, “This is not my destination, but now I’m stuck here.”
Shaan Puri: And then she was like, she was like, “Oh, she told me what her politics was. I guess she’s like, she’s like, “I’m a Republican, but like I’m just barely right of center and most of our town is Democrat.” And I was like, “Yeah, but that doesn’t really matter. All you do is like fill potholes and make sure the beaches make sure the beach is clean. Like why do your politics matter?” What do your beliefs have to do with this? Yeah, I’m like, and then and then I I it was one of those things where just 10 seconds after I said that, I was like, “Shit, I’m I’m blowing this.” Like I just am insulting you constantly. I’m not meaning to.
Sam Parr: You’re you’re like, “How long have I been on Twitter? Like I’ve just been on the internet for too long. I can’t like function in society anymore.”
Shaan Puri: Yeah, and so, uh, anyway, I I just thought it was like a horrible meeting that I blew, but she she she handled it well. By the way, the last time I met with a mayor, um, it was in San Francisco. And so I met with London Breed. I she was just a a council person, so whatever, district, I don’t even know what it was called. Literally eight hours later, I met with her at like 5:00 p.m., that night, Ed Lee died and she became mayor. And so I told this woman as I was leaving, I was like, “Hey, last time I last time I met with a last time I met with a mayor, um, this woman London became uh mayor because the real mayor died.” And I was like, “Shit, which means you’re either going to die or and I was like, forget I said that. Uh, and so anyway, I just I blew it.
Sam Parr: You needed like the Men in Black pen at the end to just flash her memory and just erase the entire conversation.
Shaan Puri: Oh man, it was horrible. Uh, but anyway, I thought it was fun. Um, have you have you been interested in politics at all or are you just totally on the sideline?
Sam Parr: I’m only interested in politics from a marketing point of view, meaning it’s like something you watch in a movie. It’s like when you watch The Hunger Games and you’re like, “That’s ridiculous.” Uh, it’s so crazy. Like this concept is so ridiculous. People just sort of like fighting for the death for the amusement of others. And then I watch like UFC 306 the next next day and I’m like, “Oh, I guess that’s kind of similar.” Or there’ll be like a politician who’s kind of like, you know, actually catering to the rich but just trying to keep the the poor, like the masses, um, you know, like just subdued enough so that they don’t revolt. And then you see kind of what some of the politicians do. You see, it’s interesting to me that this is real life, that this is actually how things go. Like I watched the full Trump rally the other day, like end to end. I don’t know if you’ve ever seen one of these, but like I started where before anyone’s on stage and I’m like, “What’s the set list? Like who’s the DJ of this?” Because it’s it goes, “Macho Man.” So it’s like, “Macho, Macho Man.” This is like nobody on the stage and the whole crowd is sitting there and they’re all enjoying it. And I was like, there’s like 30 minutes of just like a set. And the whole that musical set, that playlist should be on Spotify and it’s like the Wait, was Macho Man the song? That was the song that he came out to? No, that was the one like the the warm up the crowd one before he comes out. And it’s like Which is funny by because Macho Man is by the Village People, which is like a a gay band. Yeah, but they they played them all. YMCA, they played all the hits, actually. Another village, yeah. And then you see the the sun comes out, the daughter comes out, whatever. Anyways, uh there’s a whole, so I am interested only in the like the theater of the whole thing. All right, let me tell you what other quick story. I met the I met Ed Lee one time. The guy I was working for, Michael Birch, he got invited to this thing and he was like, “I don’t want to go to this political thing. You should go.” In my as my proxy. Ed Lee being uh the mayor of San Francisco up until like 18 or 20 or something? Yeah, so so this was when he was the mayor and the room was Ron Conway, who is like a big shot, super super angel investor, invested in like pretty much every hit Silicon Valley startup. Probably the most respected angel investor in Silicon Valley. And Mark Pincus, the guy who created Zynga, Jeremy Stoppelman, who created Yelp, and it’s basically like eight of those people and then me. And they were just they just assumed I was like, you know, the scribe who’s there to write meeting notes. And that’s kind of what I actually was. How old were you? I’m 25 years old, maybe, 26 years old at the time. But it’s pretty fascinating to see what happens in these meetings. I thought it’s just kind of going to be a luncheon, we have some sandwiches, some small talk, whatever. And a couple things stood out. One, Ron Conway is famous for taking notes. I don’t know if you’ve heard this before, but he carries with him a giant yellow legal pad. And basically everywhere he goes, he’s just like furiously taking notes. And he’s taking notes often for like, he’s actually like very quick with people, meaning if you, “Hey Ron, I just wanted to introduce myself.” He’s like, “What can I do for you, man?” And then you’re like, “Uh, I just need an introduction to this person.” He’s like, “Tell me about your business real quick.” And you tell him and he’s like, “Cool, I’ll make the intro.” And he just like moves on. Like he’s very quick because he’s a lot of people want his time. But he’s just furiously taking notes at all time. That was the first thing that stood out. Second thing was Pincus and Jeremy Stoppelman basically just ripped Ed Lee a new one to his face, which I thought was pretty amazing. What did they say? They were like, “How do you expect us to run a business here?” They were like, “It’s so expensive. None of my employees can live in the city.” On top of that, if they did live in the city, there’s just like incredible homelessness and like, you know, drugs and open air drug markets in the middle of the city. What are you doing? What is this? Like and they, you know, they were not as hostile as that, but they were very pointed. And then I got to watch, you know, a politician do what a politician does where they say a lot of words that don’t mean a whole lot. And I was like, “Is that what he did?” I was like, “Okay, cool. So I see that even in the private off-air supposed to be productive meeting, like what is he going to do? This guy’s not going to he’s not going to actually say anything of substance, nor is he going to do anything of substance.” And that was kind of my takeaway from the meeting. Horrible takeaway. I mean, I mean, like that sucks. Right? Yeah, and I don’t mean it like I don’t think he had any malintentions. It was just like these are hard problems to solve in the first place. Figuring out the solution and then actually being able to do anything about the solution would take like so much It’s how I felt when I was in a big company. It’s like you would see something and you’re like, “We should not do that. We should do something about it. We should do this better.” And then you might even try a little bit. And then the forces of bureaucracy are just weighing down on you at all times. It’s just a lot easier to just like say eff it and move on, you know? You’re like, “Well, my computer battery just is on low battery and an email might take longer than this computer battery has, so we’ll just forget about it.” You know what I mean? Well, do you do you remember we did an episode really early on in the podcast back when we used to record in your office in that tiny room with a table and one microphone in between the two of us, and we had Daniel Gross come by, and then it became three three studios on three stools sitting around one table. And one thing he said, he got acquired by Apple, his company got acquired by Apple when he was really young. I don’t know, 22 years old or something like that. And he got advice from somebody, I forgot who it was, like some super legit Silicon Valley person. He’s like, “Hey, we just got acquired by Apple. What’s your advice for me when I’m there?” And he was like, the guy told him, he goes, “Don’t give yourself brain damage.” He goes, “What?” He goes, “You’re going to be in this company and you’re going to see so many things that could be so much better, and you’re going to try to do them. And for the first year, you’re going to try to do them, you’re going to actually make a little bit of headway, but you’re not going to actually get the result that you want, and it’s still going to be so He’s like, “Basically, you’re going to just keep ramming your head against the wall trying to change this giant enormous company. Don’t give yourself brain damage. Like find a way to enjoy your time there, meet cool people, you know, learn from them, pick up the technologies, but don’t try to change, don’t try to turn the direction of the ship.” And then he goes, “And then I did exactly I I made that exact mistake. I went and tried to like turn it around and like change the way we did things and all that.” He’s like, “That person was right. I shouldn’t have given myself brain damage.” And that that he was a kid when we talked to him. I think he was 25 or 26 or something. Uh he’s amazing, by the way. That was a He was amazing then, too. Yeah, that he was one of those good finds, um, early on. Can I tell you about something uh that I read this week? So, um I read about this in I think The Atlantic. But have you ever heard of this podcast called Philosophize This? Philosophize This is what it’s called. Well, you texted it just before this and I checked it out, but I’d never heard of it. All right, so let me tell you this story. This is pretty amazing, and there’s a takeaway in this article that is a little bit different. But his name’s Stephen West, and he’s the he’s the host of this podcast, and the podcast talks about like different philosophies and things like that. Um, because the thing about philosophy is like, even if it’s interesting, it’s pretty academic and like it’s not exactly applicable to like real life, and it’s also snooty and there’s a lot of people talking about ideas that don’t really change my day-to-day. And he has this podcast that does the opposite of that. Like it’s fairly applicable, it’s fun to listen to, whatever. Now, the thing about that’s interesting about this guy is that he was actually in his uh I think he got taken away from his parents at the age of nine and he was like homeless off and on uh for a little while and then left high school at the age of 16 and then starting in 2013, he started stocking shelves inside of a grocery store. Like it was a pretty crappy job, but he was able to like find meaning in these books. He would listen to an audiobook. He said seven hours a day. He goes, “I would listen to an audio audiobooks on philosophy seven hours a day, and the last hour of the day I would do just a silly podcast.” It was manual physical labor, but I loved it because I was able to listen to these books all the time. And so by the time like a few years, a few years had passed, but he had listened to so many of these audiobooks that he kind of was like, “I devoured Western philosophy.” And like I felt like I knew all about it and I loved it. And so he read Tim Ferriss’s Four Hour Workweek book about life design. Do you remember like the concept of life life design, which is like you can build any life that you want to build, you know, but you have to map out like, what does my day look like? How much money do I think I need? What does this all look like? And he got really inspired by that, which is kind of funny that this like deep philosophy nerd got into like Tim Ferriss. And so he launched this podcast called uh Philosophize This. It um it kind of took off. And so this podcast now has like two or three million monthly downloads. The YouTube has 150,000 subscribers, but Stephen West, the guy who’s the host, there’s not too much information out there on him. Like I think he has a Twitter, but he basically just tweets out uh when there’s a new episode. But what interested me a ton is that the article said uh the article was written about this author who’s like her father was in a philosophy, but he was kind of uh unsuccessful. Like he just like studied all day and how the idea of a podcasting being being possible right now, someone like Stephen West, he’s able to make a full-time living doing this now based off of like just a hobby. And there’s this quote there that says, “Stephen doesn’t preen or preach or teach. He just talks to you like a smart, curious adult.” And I read that line and that reminded me of something. Do you remember what the old pitch for was the uh at The Hustle? Yeah, your smart, no bullshit friend, right? Something like that. Yeah, your smart, no no bullshit friend telling you what you need to know about the world of tech and business news. Right. And that was also the line for The Milk Road. It was like your smart, no nonsense friend telling you about all the news that’s going on in the crypto world. No coincidence. Yeah, no coincidence. Heavily inspired by The Hustle. Heavily inspired. But there’s like now that line is used a ton and I’m sure I stole that from someone else as well. And I read this biography uh about Gideon Gardner. He’s the guy who started Gartner, which is a research firm that is worth publicly traded 40 billion dollars, does billions in revenue. His whole shtick early on was, “I want to I want to treat my customers like they’re adults and I’m just going to talk to them in a fun way, but in a professional way, and we’re going to keep things short.” And the idea is we’re going to treat you just like a smart adult and we’re your friend. That’s kind of like an interesting takeaway because in business, there’s like you can come up with a new technology or whatever that takes off. You can uh come up with a better product, but one way I think to stick out is branding. And branding is kind of a nebulous thing where it’s like it’s kind of challenging. What’s a good brand? And this whole idea of we’re just going to treat our customers like smart adults and we’re going to going to be casual about them, that is a shtick that I have seen work in so many different industries and it has worked consistently. He does uh that wonderfully. You and I do that wonderfully. That podcast Founders, which uh I love, does that wonderfully. There’s so many different content niches that do that wonderfully, but there’s so many different brands that do that wonderfully with this idea of like we’re going to be cool, but not like actual cool, but more like casual, we’re going to be your friend. Do you know what I mean? Right. Dude, the uh when I went to Austin to record all those podcasts, I had a list of people that were doing the podcast with and I was supposed to be excited about them. It was like, “Oh, I’m going to do a podcast with Tim Ferriss and with Manish Pabrai, Joe Lonsdale, right?” Then there was all these meetings in between, and then there was one meeting that came up at the last second that I got super excited about, and it was to meet Tim Urban. Tim Urban’s the guy who writes Wait But Why, he wrote a bunch of books now. And so he’s got this blog that I love. So we go and we meet with Tim Urban, and I’m like, “Dude, I I I go, isn’t it insane that you have this little blog on the internet. You used to just write whatever was interesting to you. And then one day, the richest, greatest entrepreneur in the world slid into your DMs and was like, “Yo, I like your stuff.” And it was like, “Do you want to hang out?” And then And you’re referring to Elon Musk is a huge fan of Tim Urban. Elon was like, “Hey, this is awesome. You’re awesome. This is awesome. I’d love to meet.” And the background being Tim Urban runs a blog called Wait But Why, which when you and I were in our 20s, it was the hottest thing going and it’s still popular, but it’s like an intellectual blog, but silly. It’s kind of the same description of what you said, right? Yeah. It’s a it’s a guy who’s smart, he’s writing about the stuff that’s on his mind and he’s honest the way he writes it and he he he treats you well, whatever. So he was like, “Yeah, it was crazy.” Then Elon meets him and Elon basically says, “I would love for you to write. I I he’s like, “A bunch of people want to interview me, you know, they want me on 60 minutes, they want me on this, they want me on that. But I actually want you to write about what we’re doing with AI, with Neuralink, with Tesla, with SpaceX, like all of these things. I’d love you and you you can write whatever you want. I’m not saying write something positive, but I like your writing. I’d like you to write.” So then he wrote these series with Elon basically. He wrote a Neuralink series, he wrote like a AI series, he wrote like all these things and they were super popular. And I was like, “How crazy is that? Could you have imagined that when you started just writing on your random blog that one day the richest, most powerful entrepreneur in the world will will just slide into your DMs and just say that to you?” And he’s like, “No, he’s like, “No, I obviously couldn’t have imagined that.” But he goes, “I did always have a rule, which is my rule when I write is write for equals.” And I said, “Write for equals. That’s I immediately I was like, “Oh, I love that. What is that?” And he goes, “There’s a big temptation on the internet, which is to create content that you think is for the masses. Let me tell you about how this all works. I know you don’t know. I’ll dumb this down, I’ll sort of water this down, I’ll shave off some of the edges. I won’t tell you about anything of the unknown. I’ll tell you all the known stuff, because that’s what you want, because you need a lunchable and you want your cracker and your cheese, and then you want your um your your ham, and then you’re going to put those three together and that’s your that’s what you’re going to get for lunch.” And he goes, “I also don’t want to go the other way, which is I’m trying to impress all these people, and therefore I’m going to act out of character, trying to write to impress people who I think are more advanced than me, and I’m going to, you know, fluff up my language, use all this jargon, and try to make it sound smarter than it really is.” Instead, I just sit down and I just try to write for equals. And he goes, “The beautiful thing and he didn’t say all this, but the the beautiful thing of that is when you actually put yourself out there, you will attract by definition like-minded people. You will attract the the people who like what you do will be the people who like you.” And then you could just keep being you, which is a lot easier than trying to guess what other people might like. And so there’s like this flywheel that starts. And I would say this is probably the most common mistake that I’ve made, that every content creator makes, is this this feeling that maybe I should bend our my content to the masses, or maybe I should bend it to impress these folks, rather than just the simple write for equals. Three words. I thought it was wonderful. But my and my point in bringing this up is that this goes beyond content. This is about running your company a certain way. And Tilman Fertitta, you know, he’s this guy who um what does he own? He owns uh Landrys and a bunch of restaurant chains that are super popular. A ton of restaurant chains. Steakhouses and stuff. I read his biography and he and he and he told the story. He’s like, “Let me explain like a little bit about my philosophy.” And apparently it was like 11:30 or something at one of his restaurants and someone ordered an omelette. And the rule was like breakfast ends at 11:00 or 10:30 or something. And they like turned the customer down. And he heard about this. He goes, “Dude, the eggs are right there. Just say like, ‘I’m going to go scramble you some eggs.’ Like I got you. Let me take care of it.” And it’s just this idea of like following rules versus treating someone like a human. And it’s like a huge deal and it’s really and what I’m saying is so simple, but it’s actually hard. At Hampton, we only have 20 employees, but I still have to remind people. I go, “Just act like we’re a mom and pop business. Like treat people a certain way where you’re like they’re just like, you know, you own like a corner bodega and you see the same people every day and like, “Oh, you want the usual? Like I got you.” And that’s actually really hard to do. Uh it’s hard to teach people how to do that because they want to act a certain way, but here’s a certain here’s another good example. Anan, our friend Anan, who runs a company called CB Insights. I don’t know how big they are, but they’re around the idea, they’re around let’s say 100 million a year in revenue. And so CB Insights makes a very professional enterprise level business that costs $100,000 a year. Their website, up until recently, the homepage said, “Without data, you’re just an idiot with an opinion.” And they have a newsletter that he sends once a week to all their customers as well as their potential clients. And at the end of the email, he signs it with, “I love you, Anan.” Or like they would say things like, “Please buy a subscription because I owe people money.” Uh like they would use this I owe people a lot of money, yeah. He would like use these funny things. And I would see that and I’m like, “Not everyone’s shtick is to be funny, but everyone’s shtick should be like to not change necessarily from just treating people like a human.” And so when I saw this line about philosophy, which is like a very like lame thing, like I’ve tried to learn about it and it’s like they have like like they don’t want you to to like approach this topic because it’s very guarded. And I love that this guy’s doing this and it reminded me that we should be doing this with a lot of different things. There’s also another angle of this, which is a lot of people when they go into a business will start thinking about what industry do I like, what product do I like, and they when you’re told to kind of like follow what you like, you sort of typically think, “Oh, I’m interested in healthcare or um you know, I really like media,” and you just pick pick at this like really like 9,000 foot level. And a different way to do it is work backwards from your customers. So which customers do you respect? Which customers do you love? Which customers do you want to understand and which customers would you want to hang out with, right? So pick your customer and then work backwards from that. So instead of picking an industry and trying to find a business, you could pick a customer and try to find a pain point that could become your business. I think with Hampton, you did a good job of this, which is you want to hang out with all of your customers. They’re cool people. Those are the type of people you like to hang out with, you know, business owners and people who are somewhat successful and trying to do interesting things in their life. So you picked a business where you like, understand and um are attracted to that customer and therefore you’ll always sort of stay in love with that business. Another version of that that I found for myself is most of the time for any business, you’re not building product most of the time. Actually, as an entrepreneur, like when you sign up to start a business, you’re actually signing up to try to grow a thing. Yeah, you’re selling most of the time. You’re selling most of the time. Paul Graham wrote a blog post, “Startups equals growth.” Like, what is the differentiator between a small business and a startup? It’s that a startup is designed to grow fast, and a small business is might be like a barber shop or a nail salon, it doesn’t have to grow fast. And so if you’re going to be focused on growth, 90% of your brain, and that therefore selling, then it actually makes sense to work backwards from what is the type of sale I will need to do to make this successful. So for example, I’ve had ideas where I’m like, “Oh, that would be a great product. I would love to make that product and companies would benefit from that product.” But the problem is to do that product, to make that product grow, I would need to do enterprise sales. Something I do not know anything about, nor would I want to know anything about. I’m not curious about that, right? And so actually that business is not that product, it’s enterprise sales. And do I want to do enterprise sales every day for the next seven years? Do I want to build a team that’s really good at doing enterprise sales for the next seven years? I found for myself, for example, I love running ads. Like the first time I started doing an e-commerce business and I was like, “Wow, I can just set up this one ad and this ad will do my sales.” It’s like my money machine. It’s a money machine. Yeah, it just he works all night. I don’t even have to think about this business. My calendar doesn’t need to be booked with calls. I don’t need to send cold emails every day. This ad will just keep hustling out there. I’m sending out these armies to the corners and they’re selling for me, right? And all I need to do Do you like talk Do you like talk to the ad? Like like, “Hey sweetheart, how are you? Nice to see this morning.” I honestly like ads. I’m like, “Thank you so much.” You take this tiny commission, this small CPM fee, and in exchange, you can sell 24/7 around the clock to every single city in every single country and all around the world. You are an amazing employee, the ad. And so I work backwards from ad companies or content, right? I love creating content. So if the main way to grow this business is content, then dope. I want to do that. So picking your business based on what is the sales method is a far better way to build a business that you love and that will actually succeed than to pick the product or the industry that you think you’re that you think you like. Yeah, I completely agree. Um you said something earlier, you said um you you start studying how you make money and then you realize um you don’t know shit and then you kind of learn it and then you start and like, “All right, I know it. I just going to give myself 10 years.” And then I care less about it than I thought. Are you in that stage? Um in and out. So I think every by the way, everything goes through that stage. I want to know it. I know it. Ah shit. I thought I do it. I didn’t know it at all. And then you finally get to the point where you actually know it, but you only know it in your head. You don’t know it in your hands. You don’t know how to actually do it, right? It’s that example I gave one time on the podcast of I watched this guy make this amazing like, you know, scrambled egg and it was fluffy and it was perfect and it had chives and it was just looked so good. And watching that, I was like, I I know step-by-step what he did because he showed me step-by-step what he did with the camera, with the audio, with the instructions on the screen. But if I went and tried to make that egg right now, I’d make a horrible mess everywhere. And so first you go from I I I intellectually know the blueprint and I know it in my head, then I know it in my hands. And then at a certain point, you still enjoy maybe the craftsmanship of doing it, but the novelty of figuring out how to do it, of solving the puzzle, that goes away because you kind of solve the puzzle more and more. And I think a good thing in life is to to sort of seek new puzzles. So right now, for example, the puzzles I’m seeking, the things I’m more fascinated about rather than how did this business get to 5 million ARR with 60% margin is the creative process. How do the most creative people in in the world who create dope shit, how do they live their life? What do they do? How do they think? How do they what is the conversation they have in their head? Which is the same thing I used to ask about entrepreneurs. I just find myself more gravitating towards creative people who are living maybe a unique life or an artist-based life and then what are they doing? And that’s where my current fascination is. You’re drifting towards these beatnik artists. I’m I’m I’m wondering how the politicians gain all this power. Godly, we are sellouts, aren’t we? No, we’re not sellouts. We’re we’re grown-ups. All right, where do we want to go from here? I guess that’s it. That’s the pod.