This episode of the My First Million podcast features hosts Sam Parr and Shaan Puri discussing various business news, including the acquisition of the Gas app by Discord, the recent crypto market rally, and a case of fraud involving JPMorgan Chase and a college financial aid platform. The hosts also delve into the concept of “caper” marketing and share personal anecdotes about their experiences with growth hacking and business strategies.
Topics: JPMorgan Chase, Crypto, Discord, Gas App, Fraud, Marketing, Entrepreneurship, Business Strategy
The Boys React [00:22]
Shaan Puri: All right, we don’t normally let Ben have ideas, but we let the man out of the cage. He’s got an idea. Ben, what did you, you texted this us this morning. You want to try something. What do you want to try?
Sam Parr: We’re doing a new segment, fellas. We’re just going to, we’re going quick through the news and we’re having you guys react. People want to know what the fellas think about what’s happening. So we’re going to, we’re going to find out.
Shaan Puri: We’re calling, I want to call this “The Boys React.” I’ve been trying to make this “The Boys” thing a a thing for a little while now, and it hasn’t happened. But as I told my daughter yesterday, we never give up. And so “The Boys React” is going to be, uh, we’re going to react to the news here. So, Ben, you have some news segments, uh, or news stories, I guess. And, um, Sam, Sam actually likes the news. Sam, Sam’s into into the news. I’m a Dude, I I read the news like crazy. You don’t read the news?
Sam Parr: I’m an anti-newser.
Shaan Puri: I just love drama. You know how some people are preppers? I’m like, whatever that is where you avoid the news at all costs.
Sam Parr: Yeah, I just like gossip. I’m a big fan of drama. My life’s pretty boring, so I I I need I need drama. I love the comment sections, too.
Shaan Puri: Somebody said this the other day that, uh, I think it was like Naval or one of these smart guys, they go, um, “The goal of the media is to make every problem your problem.” And I was like, “Oh, that’s pretty true. That’s kind of like what the news is.” It’s like, “Oh, there’s a flood in this county I don’t live in. Shit, let me watch this for 20 minutes.” Why do I care about this? This has nothing to do with me. All right, but anyways, sorry, let’s start the news.
Sam Parr: Let’s start.
Shaan Puri: Okay, let’s start with the the most interesting one, Ben. What is it?
Discord Acquires Gas App [01:52]
Sam Parr: We’re starting a little close to home. Uh, your friend Nikita Bier, uh, his social app, Gas, was acquired by Discord for an undisclosed amount. What do you guys think about your buddy Nikita being acquired by Discord?
Shaan Puri: Give the background, Sean, about this guy. Like, cuz it’s a pretty, he it’s a caper. I call this a caper.
Sam Parr: I don’t even know what that means. A caper? That’s something you put on your [inaudible]. What is that?
Shaan Puri: No, a caper. It’s like a a a scheme. Like, uh, it’s like when you would rob a bank, you know, you’d be like, “It’s a great caper.” Fool me once, shame on you, fool me twice, shame on me. He just fooled the tech industry twice, dude. He sold the same app. So he built an app called TBH that was like, uh, you know, let a teenager go on and it would basically quiz you about people in your school, your friends, and be like, “Who’s the most cute boy in your life?” And you’re like, “Oh, Sam.” And it’s like, “Who’s the most likely to be famous?” “Oh, it’s Ben, right?” You just do that, right? And then it would text somebody and be like, “Somebody said you’re cute.” And this is eight years ago. Yeah, somebody said you’re cute. Download my app. And of course, that shit worked. He did that, and like, it immediately went viral because it went viral, Facebook buys the thing because Facebook has like a system internally that says like, “Viral, teen, app,” and then it’s like, “Must acquire, must acquire viral teenage app,” you know, like get that young blood in here. And so they acquired it. People had said $100 million. I don’t, it’s not $100 million. Uh, but but I think something more like 30, 40 million bucks. And, um, And this was in 2017 that he did that. 2017. He sells the app. Promptly, the app gets shut down within like a year because there was never any retention in this app. He then sits at Facebook for four years, invests out the entire every cent of his earnout, which is just hilarious in its own right. Um, and all he did was just tweet all day, you know, like, yeah, he he worked in the new products division and, uh, you know, half released some apps, I guess. And then he he leaves, you know, what what’s it called? Recidivism? Sam, you’re a you’re a person guy. He leaves the jail of Facebook and he does the same goddamn thing again. He creates another teen app for compliments. He tells us this in advance. He goes, “Yeah, I’m going to I’m just going to make an app that makes like, uh, $10 million in three months.” And we both kind of laughed it off. And we’re like, “Is that even possible?” And then he pretty much did it. I think Gas app has made 7 million in gross sales in like three-ish months. So, you know, pretty much called his shot, which we do respect. But also, we have to clarify one thing, Sam. Ben said he’s our friend. Is he still our friend after how insufferable he is in the group chat?
Sam Parr: So, he is insufferable, but I kind of like it a little bit. Uh, I I think it’s pretty hilarious. I love a good troll. I think that you’re missing some of the data here. So, he sold the company to Discord. There’s no release on price or anything like that, but uh, some people can make guesses. But basically, between leaving or being at Facebook and Discord, he creates this mystique. I call him the Jewish Great Gatsby. He creates this kind of mystique where he’s got this really lovely home in LA. I I he’s single, or at least he’s not married, and he like hosts really fun parties, and then he posts on Twitter about like his opinion on going viral, and all like legends, like or quote legends start following him. And they like message him and they he’s created this aura of sophistication and of like he knows what he’s doing with apps, which is true. It’s all true. He’s very talented. But it was pretty cool how it was like kind of systematic. So he has the talent, he has the skill, but he did a great job of also flexing that he had the talent and he had the skill, and people start flocking to him. And he starts launching this thing and he And here’s the analogy. He’s like he’s like the guy who moved to he moved to a new high school as a sophomore and then didn’t try to make a single friend, but he just went to lunch and he was just totally content sitting by himself. He wasn’t a loser. He was almost too cool to have to try. And because of that, everyone’s like, “Who is this guy? Does he have a Is his girlfriend in college? Oh my god.” And he would just be like, you know, texting his college girlfriend that you don’t know if you even know if they exist, but he just built this aura, this mystique around him by almost not trying. Whereas everybody else on Twitter is like, “Hey, follow me for more threads about how great I am,” right? And he’s he’s trying to do the exact opposite where he’s just like only shit posting and um, you know, just hinting and posting little screenshots that make you think he’s up to something big at all times.
Shaan Puri: Yeah, you’re like, “Who’s this kid coming up to school as a 16-year-old in a motorcycle?” You know? Like, this guy’s got a neck tattoo. Like, I I can’t confirm that he’s a badass, but like all all signs point to it. That that was his thing. And and he never he didn’t deny it, he didn’t confirm it, so it could be true, it could not be true. But the fact is is that he created this app, something happened to it. Like there was a crazy rumor with the app that it was used for child sex trafficking, which wasn’t true. He changed the name of the app, then he changed the name again, a third time, and it takes off and he sells it. Uh, we’re recording this on a Wednesday. I believe it was announced yesterday. This is a wonderful caper. Not to say that Discord didn’t get value. I have no idea what the truth is. Uh, the truth is probably like they’re going to make something cool of it, who knows. But he pulled it off. He called the shot, he pulled it off, and he did it in such an obnoxious way, and that’s why I love him. You know, I love guys like that.
Sam Parr: I love what he did. And honestly, I love the way he did it, too. But the problem is, he’s like a fart. A fart is amazing when you’re more than 6 feet away. But you don’t want to be too close to the fart. Like, you know, a fart’s not funny when you’re right up against it. And so that’s the problem with this is we were too close to it. We got we had to hear him. And he loves smelling his own scent. He loves smelling his own fart, too. And so, you know, he will in our group chat just post every like Twitter mention where somebody’s like, “Oh my god, Nikita has done it again. The Nikita is the best.” It’s like, “Bro, I don’t need your Twitter mentions posted here, uh, you know, for me for me to see.” Uh, it is completely he’s an insufferable fart, but I do respect what he’s pulled off.
Shaan Puri: Yeah, it’s pretty funny. So this is like an interesting thing. I can’t believe he pulled it off, but he called his shot. I respect that. I think it’s cool. Also, he’s done a thing, like you know, um, Mr. Beast does this thing where like if you go talk to a pretty serious business person, they will like reference a Mr. Beast, like a Mr. Beast-ism, where they’re like, um Well, Mr. Beast said, uh Yeah, yeah, Jimmy just says, you know, “We just try to make great videos.” As if like nobody else tries to make great videos, or he’ll be like, uh or he’ll be like, you know, “We just, um, we’re willing to put more into our content, trying to make the best content possible, blah, blah, blah.” It’s like, and then it if somebody goes and looks and they’re like, “Bro, you you your your video is, put your hand on this car, and the last person to take their hand off, you know, the last person with their hand on the car keeps the car.” Like, this is not like, you know, you’re not Steven Spielberg over here. But didn’t we talk about this where we’re like, “Look, we’re going to do this thing and we’re going to send them a welcome letter, and we’re just going to make it really delightful.” It’s just going to be a beautiful Really well done. Just beautifully done. And if you do it like that, people start to buy in, they start to eat that little puppy chow. And so similarly, he, um, Mr. Beast does this reality distortion where he makes you believe that he is the deepest thinker, he’s creating the most epic, beautiful, well-done content. He is a content savant. Really thoughtful. It’s just so thoughtful. And it’s like, you know, “Watch me fart in people’s ears.” And like, you know, it’s a It’s true that people, I’m on a fart kick today. People, um, people do like it. The content definitely works, but it creates this almost this mystique around it. And I feel like Nikita did the same thing where he’ll tweet out shit where he’ll be like, um, “Just move the butthole a little closer.” He’ll tweet out like, uh, you know, the, you know, um, the underrated metric in social networking is density, uh, by far more important than spread. And he’s like, you know, like, if you’re still measuring K-factor, you might as well still be using a Blackberry, right? And he’ll like, he’ll tweet out shit that makes you think like, “Damn, this this motherfucker knows shit that I don’t know about social networking.” Or he’ll be like, “There’s only five people on earth that can tell you about building social networks. The problem is they’re all unhirable because their name are names are Mark Zuckerberg, Jack Dorsey, and Nikita Bier.” And it’s like So, and and so by the way, I I think There’s levels to this. There’s levels. So, so I think he does a great job of creating It’s like, “Bro, you created a a app that lets me say which which girl in my high school is the cutest,” and then it texts her, “Somebody said you’re cute,” right? Like, you know, it There’s beauty in the simplicity for sure, but they almost make it sound more complicated and artistic than it really is, and uh, and and trust me, it’s it’s not. We’re not We’re not like every other social app. You see, we’re changing the world one popularity contest at a time. We are We’re democratizing popularity. He went on, um, on like CNBC or one of these like news networks or whatever, and they were like, “We have here the founder of the hit teen app, the sensational app, Gas. Nikita, what what inspired you to do this?” And he’s like, “We know, we just believe that teens, you know, the world needed a little more positivity and that uh we wanted to create a safe space for whatever.” Dude, the only safe space he wanted was a vacation home in in Tahoe. Yeah. Exactly. Exactly. You you wanted to, you know, you you wanted to fly private. That’s what you wanted. Hey, mission accomplished. I respect that. That is amazing. Yeah, his next app is going to be called Pleb. Uh, but in all seriousness, he pulled it off. I think it’s cool. Yeah, I make fun of him because uh because of how obnoxious he’s been for four months in this group chat, but uh but you know, deep down, uh he’s my kind of people. I respect uh I respect what he’s done, and I also respect the the massive troll that he’s played on everybody here. So this this is good.
JPMorgan Chase Fraud [12:11]
Shaan Puri: Speaking of trolls who didn’t pull it off, uh, Ben, we got to get to the next story. Before we get to the next story though, we do have to remind everyone we have a gentleman’s agreement here. Everyone follows it. If you follow If you listen to us, it doesn’t matter what app you’re listening to, you have to go to our YouTube page and you click subscribe. That’s the gentleman’s agreement. I have my pen here. Am I going to need this for the gentleman’s agreement? Do I need to sign something or what do I do?
Sam Parr: You actually don’t. See, all you have to do is go to our YouTube page and you click subscribe. You don’t even need a pen. That’s how easy it is. We made this gentleman’s agreement incredibly simple. You go and you subscribe and then we work for you and we make this content for you and we reveal our life and dedicate our lives to you. It’s simple. That’s the gentleman’s agreement.
Shaan Puri: I can’t find this client info. Have you heard of HubSpot? HubSpot is a CRM platform, so it shares its data across every application. Every team can stay aligned. No out of sync spreadsheets or building databases. HubSpot, grow better.
Sam Parr: Next topic, Ben. From someone who pulled off the caper to someone who did not. Uh, JPMorgan Chase bought college financial aid platform Frank for $175 million. It has now shut down the website and claims that they fabricated more than 4 million accounts, um, on their first email to their customer list. They got a 70% bounce back. Uh, founder Charlie Javis, I think it’s pronounced, uh, denies that this is fraud and claims that JPMorgan is just inventing reasons to not pay her. Fellas, boys, who do you believe?
Shaan Puri: Well, JPMorgan. This lady was on uh like that’s easy. Uh, this lady was a Forbes 30 under 30 and then just like a couple years later, sells her app for nine nine figures, 100 million plus. And uh, it’s pretty hilarious. They even found, they tracked it down, I believe, where they talked to the developers. It was a it was like a they hired one freelancer, I think, who they said, “Hey, can you like make some test data to put in here?” And he starts doing it and they’re the the the guy was like, “I think this is fraud. I’m out.” So they found those emails and then they did it again with another contractor and who actually did do it and they convinced the contractor that it wasn’t fraud. And so they’ve kind of like honed in on this that it it seems quite clear that it’s fraud. Uh, bold bold move. Very bold move. Very easy to catch though. Really stupid. Like this seems like really a a foolish mistake.
Sam Parr: Yeah, this is like um, JPMorgan’s got a little egg on their face for not not noticing this because this is pretty easy to notice. I mean, the fact that they sent one email and 70% bounced back, right? Like that that sounds uh like it wasn’t this really sophisticated, you know, botnet that, you know, was simulating real users. It was just a bunch of fake fake emails in a uh uh, you know, in a database. So, you know, that sounds pretty easy. And also it says uh there’s there’s an email with Rishi’s asking the professor who who ended up doing this. Will the will the fake emails look real with an eye check or is it better to use unique ID, right? So like, you know, handed the cookie jar as we say around here. I mean, you got caught, okay? You got got. And okay, I think we should create instead of the Forbes 30 under 30, I think we need like the Madoff 1000. We’re all the grifters and con artists that are that are out there. Um, you know, I I I think that, you know, maybe the Caper Caper 20 or something like that. We got to come up with something here and we need to just annually, I think we should just do a show where we just rank the best cons of the year and uh and give them their due. Let them put that on their bio.
Shaan Puri: Dude, I’m down. And what’s crazy is this is so so when I sold the Hustle, we had, I think 1.7 million subscribers. We used this service, HubSpot paid for it, and it was a service, I forget the name of it, but I believe it did two things. We uploaded our whole email list and then I think HubSpot uploaded some of their email. I don’t remember exactly how it worked. I think they did it. And it showed the crossover, like how many we each shared in a huge amount of emails. I imagine HubSpot has like hundreds of millions. I have no idea. A lot of emails. And then I also think it checked for fraud. And it was like a couple days to do this. It was pretty simple. Um, there’s this a few other services where they make fake data. And the reason they do this is if you have a sensitive thing like a bank startup, you put a whole bunch of fake data in it and it like makes up people and you can test your data because you you can’t use like, you know, obviously real social security numbers when you’re testing certain things and they would make up fake stuff just to test the software, make sure it all works. Tonic, I think it’s called Tonic.ai. It’s the and then it says the fake data company. We talked about them on the pod. I love this idea. I’ve been trying to invest. I forgot I need to invest in this. Yeah, I think it’s a cool thing. And so also with GPT-3, whatever it’s called, I was like thinking, I’m like, “Dude, I should just I’m not going to do this, but maybe. I I was like, I should just make up fake fake reviews for all of my like products and you can just like make up fake reviews or you can like make up negative reviews for all your competitors products. But uh, I was like Are you looking for a nomination to the Madoff 1000? We we’d be happy to have you. But you do need to formally submit the application. Put my application in. Yeah. And we have to make everyone pay a a a $500 application fee, too. Right. If there’s no con going on on our side, what what are we doing here? Yeah, yeah, yeah, yeah. Well, don’t you want to win the award? It’s an award. We did a thing with Milk Road where um we had this philosophy which is like we should be we should bank that in the future we’re going to cut out all advertisers and be our own advertiser. I mean, only promote our own product, our own service in this newsletter. Um, that’s the only way to hold yourself like accountable to not just acquiring like shitty subscribers. And so we we had started this new growth channel. We’re like, “Oh, let’s try this thing out. We heard there, you know, the rates are pretty good.” We tried it out. Uh, we tried it for like a week and we’re like, “Oh, the numbers look pretty good. We’re getting cheap signups. They’re opening the email. That sounds great.” And I was like, “Hey Ben, just, you know, just for just to double check here, why don’t you just email all those people that signed up and um just ask them like, you know, a simple question like, you know, hey, like ask them a one-line question that would be trivial for the for them to answer. Just to be like, “Hey, I just wanted to know, blah, blah, blah. I’m the founder of this thing. Just wanted to know, blank.” Uh, because they’re opening the thing daily, it looks like. Okay, fantastic. Surely they would they would reply to an email from the owner of the thing they read every day, right? Um, and he was like, “Dude, guess how many I forgot how many. There was like a couple thousand people on this thing. He was like, “Guess how many people replied.” I was like, “Well, you didn’t say percentage, so man, this is a number of people who replied.” I was like, “I don’t know, like 400, 500.” And he was like, “Two. We got two replies.” Turned off the channel. Oh my god. I was like, “Wow.” And I know a bunch of other people that are still buying from this traffic this like, you know, this uh this marketing player, this traffic source. And I’m like, “Well, they’re they’re just dumping money down the drain if they’re doing that.”
Crypto Rally [20:08]
Shaan Puri: Dude, seeing uh Billy McFarland and the Theranos lady go to jail, um, like this woman potentially could go to jail. It’s pretty crazy that like what do they not think like just like eight months in advance? It’s like, “Man, this isn’t like internet play games. This is like go to prison games.” You’re this is really screwing up a a 100 plus million dollar acquisition and 70% of the users were fake. That is crazy. You go to prison for that type of stuff. That is wild and it’s just crazy to think that no one’s there and they’re like, “Uh, Charlie, um, you know, like, are you do you like generic Oreos and baloney sandwiches? If yes, then this is great because that’s what you’re going to be eating for like the next nine months in prison.” It’s crazy. Generic Oreos? That’s that’s nice.
Sam Parr: Well, not not when it’s every day and watered down Kool-Aid. But like it’s just it’s it’s pretty wild that people don’t think ahead, but uh this is such an obvious scam. Also, JPMorgan, you guys suck, man. You guys got to be on top of the ball. Like this is such a this is seems pretty easy to to figure out.
Shaan Puri: Yeah, fair enough. All right, what’s what’s next?
Sam Parr: All right. Um, Bitcoin and Ethereum are up 23% over the last week. Uh, crypto is rallying. Uh, one major cause is continued rise of inflation, 6.5% annualized in December. The question for you fellas, is crypto back?
Shaan Puri: No. You want to just end it there? I don’t know. Well, I will give you That’s a great answer, Sam. I will give you a slightly different answer. Do I get to say like I told you so? No, I I don’t get to say I told you so. In fact, I might maybe take the other the other L. Did I did I sell Milk Road too early? Did I sell the bottom? Um, no, I I think that a lot of things are rallying right now. Why? Because people did I I think it’s just a simple answer. People did an end-of-year sell-off in December for tax loss harvesting and a lot of people will re-enter and then that creates some upward momentum and when there’s upward momentum, that makes people think, “Hey, is it coming back? Is this the rally? Uh, did we did we hit the bottom? Is it time to buy back in?” And so people are buying back in. Um, I don’t think it’s because inflation in December, because guess what, we had inflation in October, in November, in September, in August, too. Like, where where was, you know, if if inflation was driving crypto up, it should have been up all year last year, not uh not down. And so I don’t think that that narrative holds. I think it’s much more likely that the same way that tech stocks are having a little brief rally, um, it’s uh it’s kind of like New Year optimism, uh, people being done with their kind of like in crypto, there’s no wash sale rules, so you could sell, book the loss for tax purposes and buy back in one minute later, uh, if you wanted to. And so I think people are just buying back in and I think there’s a little bit of people chasing momentum. That’s my guess.
Shaan Puri: Have you ever looked at the correlation between G-Wagon prices, used Rolex market, and Miami penthouses and how it relates to crypto? There’s got to be a correlation there. I have not. I have not. There’s got to be a correlation there. Did you see We got the best data people on it. Did you see um Yeah, Ben, Google that. Did you see uh uh I’m just going to start telling Ben just to Google random stuff that are ungoogleable. Uh, did did you see that there was a guy in like, you know how we have this Facebook group for MFM that we don’t really check often, but there was a guy who was like posting in it a bunch and he created this website where you can sell your NFT at a loss for tax purposes. It’s kind of interesting.
Sam Parr: It was a great idea, honestly. Um, What’s it called? I forgot I I’m going to forget the name. But uh Ben might actually know it. Um, it was called they advertised in the Milk Road, so I remember seeing it there and being like, “Oh wow, this is actually a great idea.” Hold on, Ben just typed in the chat. What did you say? It was like a really it was like a a a white guy with like blonde hair, looks like Unsellable. And what is it? Unsellable NFTs? Yeah. Yeah, that’s it. Unsellable NFTs. And so basically, um, if you wanted to book a a a loss on your NFT, they would basically let you instantly get liquidity on it and get it right back, I think, is the is the is the idea. Um, which is just a very useful simple tool. So, you know, get on that guy for creating that. That that that was a smart smart idea.
Shaan Puri: So, is this the segment? Dem boys? Dem boys react? Is that it? I think I think we’re not ready for Dem boys yet. I think we’re still the boys until until we get a little more street cred. Go to the YouTube comments and tell us, is the boys going to stick? Can I make it a thing? Because I sure sure would like that. Yeah. Just type is a thing or not a thing in the comments. I just want to I’ll do I’ll read the poll and if it says not a thing, I’ll only continue for another three or four years. If it says it’s a thing, I’m I’m totally validated.
Sam Parr: All right, that’s it.