The Richest People I Know Do One Thing

Speakers: Sam Parr (host), Shaan Puri (host)

The Humble Turn: Nick Huber’s Business Evolution [00:00:00]

Shaan Puri: All right, look on YouTube, everybody talks about how they’re crushing it. Every business podcast, every business influencer is talking about how great everything is going, but on today’s podcast, my buddy Nick is coming on and he’s doing the opposite. He’s talking about a bunch of the big mistakes he’s made. He’s eating humble pie publicly on the podcast today and talking about some of the things he’s learned from it.

I want you to tune into this episode. He was talking about how he made the biggest acquisition of his life when he bought somewhere.com, how he might have screwed up certain things, and how he’s trying to recover from those. It’s another side to Nick. If you know Nick, he’s a popular guy online, but you don’t always get to see the humble side. And so, I think it’s a great episode with Nick. Enjoy. All right. What’s up? We got Nick Huber here, friend of the pod. Nick, what’s up, man?

Nick Huber: Shaan, thanks for having me. It’s been a long time.

Shaan Puri: Dude, you wrote something. We have every guest do a little prep doc of what are some things on your mind, stories, ideas that you want to share. And you wrote one that I think is very interesting to people who’ve been following Nick Huber. You built up this personality online of being confident, borderline cocky. You have strong opinions. You are not afraid to piss some people off. And you said this in the document: “I have been humbled off my cocky attitude in my 30s.” Is this a—do we have a heel? What’s a face turn like in wrestling where the bad guy becomes good? What’s going on?

Nick Huber: Yeah, man. I think the last five years in business—I mean, five years ago, you guys had me on the pod. I felt like I knew everything. I think it was that irrational confidence early in my career that I wouldn’t trade for anything because I think it led to a lot of success and me putting myself out there. But yeah, man. You just realize that business is hard. Business is really hard. 2024 and 2025 are not the same as 2022 and 2023 for any entrepreneur I know.

Shaan Puri: Give me an example of what Nick was thinking then versus Nick thinking now. There’s this great phrase: “everyone’s a genius in a bull market.” I think part of what you’re going to talk about is back in 2020, 2021, 2019—during that era, it felt like you could do no wrong. Give me Nick back then; he was thinking XYZ about himself or the world. And now what is Nick thinking?

Nick Huber: I thought business was easy. I thought building executive teams was easy. I thought customers just came. I thought I could do no wrong because I had this personal brand. I started all these companies—started 10 plus companies over a three-year period. Four of them have been shut down. So yeah, it’s not all roses.

Shaan Puri: It’s not all roses. But you are, I guess, older and wiser now and some things shut down, but other things you’ve doubled down on and have started to work. What do you think caused that? Was it just the market kicking your ass a little bit in certain areas that made you reassess? Were you wrong about a specific thing?

Nick Huber: I thought with a personal brand that’s strong enough, you could get into an agency business of any kind and go to the moon whether or not you do a couple things right or a couple things wrong. And then the algorithm changed. The business got a little harder. People started really watching how they’re spending money. I just think it’s harder now than it was, man. I know a lot of people who are making less money now than they were three years ago.

The Somewhere.com Acquisition Story [00:04:12]

Shaan Puri: Right. I want to jump around into some of your new ideas—things you’re feeling and thinking right now. You mentioned being humbled and you mentioned your portfolio going from—how many companies did you have at your peak and how many do you have now?

Nick Huber: 11. I started 11 companies from 2016 was my first.

Shaan Puri: You were like, “I’m going to do an SEO company. I got a storage company.” What else did you have? You had a bunch of others.

Nick Huber: A pay-per-click marketing company called Ad Rhino. I had a sales consulting company called Huber Method. I had a business brokerage. I had, on and on and on. I went through a phase where I was like, “I got the hot hand. My audience is super powerful. Let’s scale up some companies.”

Shaan Puri: Do you remember at your peak what the group revenue or cash flow was of the companies you owned? Because it was working for a little while, right?

Nick Huber: Yeah. Group cash flow right now is actually way higher than it was, but it’s only because of a three-headed monster of the companies that rose to the top. It’s kind of like a power law thing. But of the six bottom ones, we were up to half a million dollars a month of total revenue. I shut down four and two of them are treading water right now.

Shaan Puri: Right. And so the most interesting lesson—because I’ve got to see it from the inside. I don’t know how much of this you’ve shared, but we were both partners in a company called Somewhere. Actually, at the time it was called Shepherd. People don’t know the backstory here. The backstory is Marshall, who was the founder of the company, owned the majority of the company. Me and Nick both had a good chunk, but in the minority.

Marshall calls and he says, “Hey, I got an acquisition offer. I think I’m going to take it.” And I was like, “Oh, wow. Talk me through it. What is it?” And he tells us that Andrew Wilkinson, our buddy, other friend of the pod, made an offer to buy the company for $52 million. This was great. This is a company that Marshall bootstrapped, didn’t raise any money. So, potentially a big exit, but it was a stock-based deal. Marshall was going to take it and Marshall had worked for Andrew when he was young; he had a lot of respect for Andrew.

I think part of it was this full-circle validation moment. Every entrepreneur can have that where it’s like, “Wow, Facebook wants to buy my company. That’s unbelievable.” And then there’s the financial component to it. On the phone, I was like, “Well, let me give you my opinion.” And I realized very quickly, “Oh, he’s actually already decided.” This was a “let me just let you know” disguised as a “what do you think” call.

But I’m a very opinionated guy, so not to be deterred, I was like, “Hey listen, we’re growing really fast. I like our stock. Why would we trade our stock for another person’s stock? We should just keep our stock. It’s growing. It’s a small company, so by nature it’s going to grow much faster than these larger companies. That stock might not be that liquid. Are you sure this is a deal you want to do?”

Then I call Nick and I’m like, “Nick, what do you think?” I had this opinion, you were very similar, and we had this idea of: if he wants to sell, maybe we could buy it. Originally that was some of the idea. I said, “Oh look, my life will get too crazy and complicated. I don’t want to do this.” But you were like, “I’m going to do it.” So walk me through what happened. First of all, was that your same history? Did I mess anything up there?

Nick Huber: Yeah, it was a $47 million valuation. The company was three years old and growing really fast—about 150 employees. I was a customer and then became an investor and had started to build worldwide teams. But yeah, here we are. Marshall calls me: “Hey, Andrew wants to make an offer to buy the company.” I realized, “Hey, I don’t want to sell any of this company. If anything, I want more of this business.”

This was peak Nick Huber—not humble Nick Huber—thinking I can do anything and I can’t go wrong. And by the way, we had just tripled the business that year. So, it wasn’t like we had any reason to not have confidence. The business had just tripled in cash flow. And so, that was good.

Structuring the $52 Million Deal [00:09:45]

Shaan Puri: Okay, carry on. So, you decide—I tell you, “Hey, I think I’m probably not going to do it,” but you’re like, “I’m going to do this anyways.”

Nick Huber: Yeah. I say, “Marshall, actually, I want to be the one to buy your company. You shouldn’t sell it to Andrew. You should sell it to me.”

Shaan Puri: And his initial reaction is like, “You and what money?”

Nick Huber: Yeah. He had a lot of questions. His jaw almost hit the floor. He’s like, “Nick, this is insane. Are you kidding me? This is life-changing money.” It was a 51% deal because he still needed me and you in because we were sending a lot of business in. He still wanted Marshall to have some skin in the game.

And yeah, man, the next three-month period, I sold Marshall on the fact that I could raise $20 million bucks. I negotiated a seller note for a chunk of it. I had to get very creative with how I structured this deal because I realized real quick that it’s not the same as real estate in how much skin I can get in the game.

Shaan Puri: So let’s talk through this because a lot of people will give high-level numbers—valuation, sale price—but terms is where anybody who’s done deals knows structure and terms matter a ton in how a deal gets done. Whether it’s an all-stock deal, all-cash deal, upfront earnout, contingency-based, seller finance, debt—there’s a big array of different ways a deal can go down. Can you just give us the simple version of what was the deal?

Nick Huber: Yes, it was originally a $47 million offer from Andrew, but the business kept growing over the next six months that we got this deal done. It became a $52 million purchase acquisition price. Let me be clear that early on it felt like me and Andrew negotiating against each other. Holy shit, I’m negotiating against a titan. This guy’s bought 40 companies, you’ve bought zero.

Shaan Puri: Yeah. Publicly traded business, a billionaire on paper for a while. A great friend of ours.

Nick Huber: And then Andrew just thought about some AI risk. He saw maybe some headwinds and he said, “Nick, maybe we’ll do this together.” It was a conversation throughout. It wasn’t as if we have any animosity between each other. But yeah, I was going to raise $20 million to buy about 40% of the company from Marshall. I realize that if I go out and raise $20 million to buy this company, I’m only entitled to a 20% carry on top once everybody gets their money back.

Shaan Puri: Right. So the structure is you go to investors, investors give you $20 million. Your deal with them is “I get a 20% carry or profit share of that.” So you’re only owning—the $20 million buys you what percentage of the company?

Nick Huber: We’re doing whole numbers. It was 39.25% for $20 million and change, but let’s say 40% for $20 million. I would need to get them all made whole—their money back plus a hurdle—to then get an 8% upside, which is 20% of 40 million. So my ownership stock would go from about 12% to about 20%. I’d have to raise $20 million bucks. I’d put my name on the line. I would take all this risk, do all this work. Very quickly, I realized I can’t do this deal. It would be foolish for me to do this. So, I went back to Marshall and said, “Hey, I need to buy more of the company.” And this is where we got creative and I carved out an 18% seller note directly from Marshall to me.

Shaan Puri: And a seller note is basically the seller saying, “I will lend you essentially the money to pay me, and you’re going to pay me every year or every quarter.” So what was that? About $9 million bucks for 18% of the company?

Nick Huber: All right. So all in, you raised $20 million from investors. You get $9 million something from Marshall. So you’re in $29 million and now you’re in charge. You’ve got peak energy and I’m talking to you and we both are like, “Dude, we’ve had so many ideas how we could turn this business from X to Y. This is going to be great.” And then what happens?

Post-Acquisition Challenges: Name Changes and Algorithms [00:14:05]

Nick Huber: Three things changed drastically. Number one, we changed the name from Support Shepherd. I’d sat over too many people’s shoulders watching them spell Shepherd incorrectly—smart people—to know that holy cow, we cannot grow a big company with this name. So, we bought somewhere.com for $400,000 shortly after closing.

Changed the name from supportshepard.com to somewhere.com. Our SEO—our search engine optimization—and our brand recognition vanished overnight. In that one fell swoop, we lost 300 leads a month out of about a thousand leads that we had.

Shaan Puri: So you lose a third of your traffic on your brilliant name change. Okay, next.

Nick Huber: Yeah, let me look at my notes. Number two: Elon bought Twitter. Elon bought Twitter and started drastically messing with the algorithm quickly. It went from me being able to tweet about hiring somebody in the Philippines for $5 an hour and send 3,000 website visits and 200, 300, 400 leads to the company, to virtually nothing. So my ability to send business to the company with my personal brand vanished.

Shaan Puri: Okay.

Nick Huber: The third thing is I wasn’t the only one to think international hiring was a beautiful business and many, many competitors started over the next six months to a year.

Shaan Puri: And you guys were pretty loud about the acquisition, which also invites competition.

Nick Huber: You tried telling me over the years, by the way. I tried telling you this, but everybody wanted to pound their chest naturally, honestly. And I get it. And there’s actually an upside to it, too. The month we announced—to be fair, the two months after we announced the acquisition, it was actually peak growth because a lot of people went and checked it out and realized, “Wow, there’s a reason why all these people use this service. There’s a reason why there’s a high repeat rate of this service. It’s probably pretty good.” So it did initially cause a burst, but it also emboldened the existing competitors to go harder and it created 10 new competitors.

Shaan Puri: Yep. And then the economy started to shift. Interest rates went up, a general silent recession happened in a lot of different industries.

Nick Huber: Right. And our customer base was not super well-funded AI companies where spending was just sloshing money around. We help real businesses. Whether it’s small business agency owners who own 100% of the business and the cash flow matters to them, or e-commerce businesses where you’re already on tight margins and that’s why you leverage global talent—because it improves your margins—but you might just stop hiring altogether. You might actually shrink your workforce. Tariffs are coming. You don’t know what’s going to happen with that. So you shrink your workforce. We would serve tech companies that were more responsible with their cash. All these business owners that are great customers to have and a big part of our audience, they are obviously cost-sensitive because they live in the real world. They’re not VC-subsidized with $50 million rounds where you can just aggressively go hire and spend against macroeconomic headwinds.

Shaan Puri: Yeah. E-com headwinds, home service headwinds, construction headwinds, real estate headwinds means less people are hiring, less people are growing their teams.

Nick Huber: Right. And I made a lot of bold, quick executive changes inside of Somewhere when I acquired it. The company had grown very quickly. It was doing 95% of its hiring in the Philippines—executive assistants. We started to invest in Latin America. We started to invest in South Africa, finance talent in Egypt, building executive teams in South Africa, performance marketers—high-skilled talent on how to structure and build a company from the ground up internationally.

The Global Talent Hack: Hiring Executives Abroad [00:18:15]

Shaan Puri: It’s an important part. I’m making fun of some of the decisions because there is a happy ending. It all works out. The company’s back. It’s growing well. All that good stuff. So then it’s fun to laugh about mistakes. It’s not so fun if things go poorly; you don’t laugh about the mistakes as much. You cry about them.

Nick Huber: Yeah, we’re making it sound like we’re going to end this in bankruptcy. But—

Shaan Puri: No, no. Give the spoiler, then we’ll keep going.

Nick Huber: Over the last four months, if you compare it to before the acquisition—those four months I was negotiating the deal—we’re up about 60% from a revenue perspective. Over the last year, it’s 28%. So, I’m still behind my pro forma of what I hoped to do with the company when I bought it, but revenue is growing very healthily and our team is awesome. I think we’re doing a phenomenal job of finding people all over the world. I’ve learned a ton about worldwide recruiting. I want to give some people some tips, too, on how to do this themselves—what to look for.

The reason I wanted to share this is because 99% of people talking about their experiences buying and running businesses—the selection effect is the people who are failing shut up and the people who are succeeding get real loud. I think what’s cool about you is that you can give it and you can take it. You are bold and you say what you mean, you say what you feel, you’re not afraid to be wrong. And if you’re wrong, you say, “I was wrong.” I really love that about you. I think that’s actually quite rare. In this case, you’re basically saying, “Hey, I went and did this deal and then here’s a bunch of things that immediately I did wrong or went wrong for me and I had to figure out how to do better.” I think that’s actually quite admirable.

The second part of it is there was something that in sports they call “new owner syndrome,” which is anytime a sports owner buys a team, they immediately start changing everything because they’re like, “Oh, I can do no wrong. I know how to fix this. I’m going to do all these great things in year one.” One of the things that I think is actually pretty interesting here is even though we run this global talent company and we were finding talent all over the globe, we were mostly finding junior and mid-level talent. Whether it’s assistants—executive assistants was a huge part of our business—sales folks, whatever.

C-suite folks we would typically assume are—well, that’s who I want to use different local hires for, either in the same office as me or just American hires. Expensive big pay packages, a lot of pedigree with companies I recognized. And so we did that. We hired a bunch of executives and that made total sense on paper. One of the cool things that you figured out that I didn’t see going into this was since then you have actually rebuilt not just the junior and mid-level, but actually the executive team with executive talent elsewhere.

I kind of took that and I was like, “Oh, I should do that in my businesses because that’s actually an even bigger hack.” You were like, “Dude, I’m finding this person in South Africa. They’ve got an MBA. They speak perfect English. They’ve worked for international companies and American companies that do work internationally for 12 years. They’ve been a financial controller controlling these budgets and you can hire that person at this price. That’s incredible.” You’re saving huge amounts of money on really great talent and really hungry, low-maintenance, hard-working talent all around the globe. That was one of the bigger surprises to me and things we got wrong that we corrected. I don’t know if you want to say a quick thing about that.

Nick Huber: Yeah, I have six Americans at Somewhere out of 160 employees. RE Cost Seg, another company in my portfolio that’s growing really fast, has 130 employees and seven Americans. Bolt Storage has six Americans out of 60 employees. They’re all in sales and account management because I just can’t replicate the Americans’ ability to close deals—high-ticket deals.

Now, we’re close with a couple South Africans, but a COO at RE Cost Seg is in Johannesburg, South Africa. The head of performance marketing is in Bogota, Colombia. The head of finance is an IT consultant who got me through SOC 2 compliance—we got our certificate this week—in Cape Town, South Africa. I used to think, “Okay, I need repeatable tasks and I need to outsource those to the Philippines, South Africa, Colombia, whatever.” Now I’m realizing that the people who can run my company can do it better and cheaper internationally.

How to Hire Global Talent Without an Agency [00:23:10]

Shaan Puri: I don’t want this to be a Somewhere plug, but you were like, “Dude, I could tell you how to do this without Somewhere.” I was like, “Oh, that’s an anti-ad.” So great, you could do Somewhere, but here’s how you do it without us. How do you do it without us?

Nick Huber: We get 60,000 applicants a month. Half those are from LinkedIn and Indeed and Monster promoted job postings. I’m going to tell you exactly how we do it. The other half are from referrals and ads that we run out on the open market for people that already have jobs. But yeah, if you want to make your own hire, go on LinkedIn, post a job. I’d recommend Colombia, Brazil, South Africa, and the Philippines. Those are the four hottest places to hire. If you’re looking for finance, there’s Egypt. Engineers: Eastern Europe and some other countries. Go on there and promote the job on LinkedIn with $100 a day and run it for five days. Post the job in those countries on LinkedIn. Promote it with $100 a day. Run it for five days. So you’re in for maybe two grand. You’re going to get a thousand applicants.

Shaan Puri: All right. But that’s too many. How do I filter?

Nick Huber: We have figured out—and I’m going to pass this on to you—that of our 60,000 applicants every single month, 85% of them can’t type 35 words per minute. If we’re talking about remote work in any role from engineering to marketing to graphic design to admin to sales to executive leadership, your easiest immediate filter is a typing speed English test.

Shaan Puri: We’re getting that down to 5,000 people a month that are coming in. You wipe out 80% of people right away. Great. What’s the next easiest heuristic to find great talent?

Nick Huber: We’re going to send them a request for a one-minute video where they film themselves introducing themselves for one minute. 80% of the people are just not willing to do the work. They’re not that serious about looking for a job. So the other 20% you’re left with maybe a thousand. This is our talent pool. With your job post that you got a thousand applicants, you’re left with maybe 30 or 40 people that can type over 35 words per minute and have sent you the video.

You watch the videos. You look at the professional maturity. You look at how they communicate, which is a big part of the job. And you pick your favorite five to hire. Then I love assessments. If they’re coming into a sales role, I love sending them five calls from my sales team and saying, “Hey, break these down. Record a three-minute video on missed opportunities or how they would improve.” Then you’re going to be left with three or four really great candidates and hire them.

Shaan Puri: Task-based tests over interviews are huge. We do that in all of our—

Nick Huber: I didn’t even mention the interview, I guess.

Shaan Puri: Well, I don’t even get to an interview at this stage. This is how we do it when I do this with Ben and our companies. Part of it is actually useful for you. When you sit down, you say, “All right, if I was going to give somebody a test that they could do in something like 60 to 90 minutes, what would most closely simulate the type of stuff I want to see them be able to do?”

Now you get clarity on what you are actually looking for, which most people when they go into interviews don’t actually even know. That’s the dirty secret why you make a lot of bad hires. Once you do that, you get clarity. Then they actually show you and now you’re not saying, “Hey, you talked to this person. How’d you like him?” “I liked him. So nice.” It’s like, “No, no, no. We have an objective way to just say: here’s what one person produced. Here’s what the other person produced.”

We start with production because that’s what we’re going to want in the end. We will often—I don’t know if you do this—but we will often just pay. “Hey, I’ll pay you for the hour of time, two hours of time.” This is a paid task trial because you’re actually saving me money and time of interviewing and making a false hire because I liked you when we had a nice chat, but you actually weren’t good at doing the thing.

Nick Huber: Exactly. I want to give some people advice on where to go as well because I’ve learned a ton about what cities and what countries are hotspots for what type of talent. Cairo, Egypt is the cheapest city in the world. You can find people who can work magic in Microsoft Excel and PowerBI from a finance data analyst perspective. Colombia and Brazil are unbelievable for operations. They’re on your same time zone. Every single role, if they don’t need perfect English—if they’re not in a sales role—South America is amazing.

South Africa is a sales and finance hub. There’s 30,000 South Africans that get on a plane and go to America every single year to do audit and tax work for Big Four consulting firms. They go back to South Africa and you can hire them for three grand a month to be a controller at your small business. So yeah, it’s just unbelievable areas. I love Sri Lanka as well for almost all roles. Philippines, obviously—there’s 30 million Filipinos working for American companies today. It’s just deeply ingrained in their culture.

The Assistant Assessment Framework [00:28:45]

Shaan Puri: To give people an example of the assessment real quick, I just pulled one up. This is what I use to find my assistant. I basically gave this out and I said, “I want you to do the task and I want you to record a Loom video explaining what you did as you do each task,” which tells me their thought process, shows me how they work and not just the end product. I also get to hear them communicate and see if they’re an easy person to communicate with.

My assistant task: I said, “Pretend you’re booking a vacation from LA to Paris for my wife and I. Our ideal dates are this, but we’re flexible on those by a day or two. Here’s our preferences. Send me a couple options: the lowest cost option, the best option that balances convenience and cost, and maybe the most luxurious option.” I want to see them put together a menu of options because that’s typically how I work with my assistant. It’s like: you get me to 90% and then I pick and choose what I want.

Another one: I said, “Here’s a voice note.” I put a voice note on SoundCloud of me dictating while driving. “Draft these two emails based on what I mentioned.” In that voice note, I’m like, “Hey, I promised so-and-so I would introduce them to so-and-so, I met them at lunch, blah, blah, blah.” I try to see if they can quickly grok—basically, can I write a fuzzy address on an envelope and will it still get there? Because I’m not going to get perfect instructions most of the time. How do they deal with imperfect instructions?

I’ll have them do simple things like: “Hey, I just moved from Texas to Wyoming and I need to change my driver’s license. Can you figure out how I need to get DMV work done? Could you do it all the way and if not, what steps do you need me to do?” And then: “Make a birthday card in Canva for my daughter’s birthday.” I want to see if they have basic design and event organization skills.

The last one was research. “I’m looking for influencers for this new fitness product that I have. Find me 10 fitness influencers that fit this criteria.” Let me just see if they’re able to quickly do data collection and research and provide something useful to me. Those are examples of what tasks I put out there. It’s a one-page Google Doc and they send me a Loom video of them doing each task. That’s how I quickly filtered through 50 people. Somewhere basically was like, “Hey, here’s 50 people. Here’s the four we like best.” I gave them the assessment. I didn’t like the first four. Then they gave me another batch of four and immediately there was someone who was great.

Nick Huber: They shine. The person who’s competent will shine to the top of the crowd without any work on your end. It’s a beautiful thing.

Shaan Puri: You were basically saying people can find it themselves. If they wanted to find it through Somewhere, what is a simple way to do that?

Nick Huber: I prepared a special thing for your audience. Do you want to talk about that now or just generally how the company works?

Shaan Puri: Yeah. What is it? What do you have?

Nick Huber: In advance of this episode, I personally vetted and interviewed 10 salespeople in South Africa, 10 finance folks in Egypt, LatAm, and South Africa, and 10 executive assistants in Sri Lanka, LatAm, and South Africa.

Shaan Puri: Gotcha. So you did a personal vet short list for each.

Nick Huber: I watched their videos. I analyzed their resumes.

Shaan Puri: What do you want people to do? Email you or how do people get access to that?

Nick Huber: Yeah, if they email me at nick@startup.com, I can hook them up with some of these profiles, let them see them, and hopefully help them grow their team.

The “One Big Thing” and the Myth of the HoldCo [00:32:45]

Shaan Puri: That’s cool. I’m curious, man. You are always meeting interesting people partly due to having a presence on Twitter, partly just because you have one foot in the sweaty startup world and one foot in the tech world/online media world. Who have you met recently that either inspired you or broke your frame in some way? Or somebody who you think is doing cool stuff?

I have one person in mind who’s building a pest control monster of a company. I don’t want to out him; it’s just incredible to me. You’ve actually taught me a lot of this stuff: they find one thing that really works inside their company and they just run the same play for five or 10 years to grow a monster business.

Nick Huber: Hammer it.

Shaan Puri: I didn’t think that business worked that way—that you could do one thing really well and everything else—you’re not hiring internationally, you’re not doing the latest software, you haven’t even looked at AI, you’re not answering the phone past 5:01 p.m., but you do this one thing well and you’re worth $100 million.

Have you ever seen Peter Thiel taught a class at Stanford and they put the class notes online? It’s been there for a long time. It’s called the Blake Masters notes. Did you ever read those?

Nick Huber: No. What’s the main takeaway?

Shaan Puri: He’s like, “I get a lot of investor pitches. I’ve invested in—I was the seed investor in Facebook. You have some huge winners and you have a bunch of losers. What do you notice with them?” He says one of the biggest poker tells with a business is when they have seven revenue streams. They come in puffing their chest being like, “Look, we’ve got seven.” And he’s like, “All they’ve told me is they don’t have one great one.”

Same thing with distribution channels. When I ask them how they get customers today, if they tell me seven things, all that tells me is they don’t have one amazing thing. All the best companies find one distribution channel that really works and one revenue stream that really works. For Facebook, the distribution channel that worked was viral photo tagging on campuses initially, and then eventually off campuses. The monetization was ads. Facebook didn’t need to sell stickers and didn’t need to do a thousand other things that all the other social networks were actually doing. M&M’s did a homepage takeover and we signed this deal with this movie studio and they’re going to do a cool campaign with us. Facebook was like: self-served banner ads will be the thing and this will be the growth tactic.

Nick Huber: Brad Jacobs. Brad Jacobs with how he grew United Rentals and several of these other companies. He ran the same plays.

Shaan Puri: What was his play? I actually don’t know.

Nick Huber: I’m sure he had several different plays, but how you make a few billion dollars is you find a way to grow an equipment rental business through—is it local ads? Is it outbound sales? They had a really good outbound sales team for contractors. And then boom, that business skyrocketed. He pulled his same executive team, pulled his main players out of that company once it went public, put them in the next one, and boom. That’s how you grow five companies in a row: figuring out what companies that play will work for.

Shaan Puri: I’ve told this story before, but it’s probably one of my most humbling and insightful moments—a hard lesson learned very quickly. A Band-Aid that got ripped off for me. We have a buddy, Sulie, who you know. Sulie is like my business Yoda. If I got a business problem, I go to Yoda and he gives me the—he can’t even really explain, he just sees through all the noise that I bring him and he finds the thing.

My e-commerce business was early on and it was growing. I think we were at maybe $100,000 a month in revenue—like a million-dollar thing. Our how did we get there? We were doing Facebook ads. He told me: do Facebook ads and focus on Facebook ads. I was like, “But what about Google?” He’s like, “But what about what I just told you?” I was like, “Okay, cool.”

So Facebook ads is working. I feel super accomplished. We’ve gone from zero to 100K in like three months. This is awesome. So I go to him. I’m like, “Dude, it’s working. I’m thinking now we should do influencers and we should spin up Google because of course who doesn’t do Google? But I really think influencers could work. Here’s this cool influencer idea I have.”

He just basically cut me off. He was like, “You want to win, right?” And I was like, “Yeah.” He’s like, “Cool. Don’t say the word influencers until you’re at $300,000 a month just off of Facebook.” I was like, “But would it be bad to do both?” And he’s like, “Well, here’s the thing. Is there any reason you believe that Facebook can’t get you to 300,000?” No. I got us to 100. Why couldn’t it get us to three? And he’s like, “And if we couldn’t get Facebook to three, do you think any amount of influencers is going to save us?”

A successful e-com brand should be spending basically $1 million plus per month in just Facebook ads, which means you’re making more than a million dollars off of Facebook. That’s where you’re trying to get to. That’s the goal. You kind of have a broken company if you can’t really get there. Most e-com companies win off of Facebook ads. So you should just try to win off of Facebook ads before you go do all this other shit.

I had expected when I was going to get advice from him that he’s going to give me these amazing strategies, these new hacks, these brilliant tactics. Actually, the most useful thing he did for me was just say: don’t say the word influencers until Facebook is cranking $300,000 a month to your business. And by the way, we kept it going. After 300 we did 500. After 500 we did a million. You just keep going off of just those two. Guess what? I still don’t do influencers. It’s now five years later, we didn’t need it, and I definitely would have distracted myself with what sounds like a good idea. It comes back to the Steve Jobs quote: focus is not about what you say yes to. It’s about saying no to otherwise great ideas.

Nick Huber: One of my companies was spending upwards of $150,000 on paid ads a month. We realized that our ROAS is barely breaking even. We calculated it down to the profit and realized that that piece of the company was making us maybe $15 to $20,000 a month in profit. And we were spending tons of executive time and energy to try to get that to work.

We looked at our other part of our revenue stream and it said referrals. Referrals coming in the doors generating $250,000 of profit per month on maybe $30,000 of referral fees and discounts. What would happen if for six months our entire executive team laser-focused on growing that referral number? Do we think that we’d be better off than the last year and a half we’ve been trying to slam a round peg into a square hole? It’s unbelievable. The job of a CEO sometimes is literally just to tell your team no and to get them focused on what’s already working.

Shaan Puri: Exactly. And not hedge. I would say no, but then we kind of greenlight this little test. I would say no, but then two weeks later, we just do it anyways. What happened to our no? Was that not a real no? I think there’s all these ways where you can think you’re compromising or you’re having your cake and eating it too, but actually you’re just spilling your cake on the floor. It’s better to not do that.

You said running a HoldCo is overrated. I think the trend will die down. Most rich guys I know are focused on one big business and built it for a long time. So HoldCos or these portfolios of businesses like you were doing was a very big idea or popular idea in our circles about five years ago. It’s not a new idea. HoldCos have been around for a long time. Give me your updated thoughts on the HoldCo.

Nick Huber: Man, I think over the last three or four years I’ve been kind of labeled as one of the HoldCo guys. There’s several more of us, but I’ve had a lot of people reach out. “I got this plan to buy more companies. I’m going to grow to five, eight, 10 companies and the synergies and all this stuff.” I think you really got to know your shit to run more than one company.

The majority of people that I know who run more than one company—they ran just one company for a long time, made it really good, made it really profitable, learned how to build executive teams, learned how to build compensation plans, learned how to work the funnel and convert at the highest rate all the way down the funnel. If you don’t know those things and you start going around buying different companies—especially if you use leverage, borrow money to do it—things can go really wrong really quick.

Unlike real estate, which was my first business where you get a couple clients in and they pay rent every single month, operating companies can have massive swings in revenue and profit. I think everybody thinks it’s cool. Another thing about it is you just solve freaking problems all the time. The biggest problems in each individual company bubble up and come to you. When I look at some of the wealthiest people I know, almost all of them focused on one thing and made that one thing really big. There’s something to that.

Consistency and the “Tortoise vs. Hare” Philosophy [00:42:15]

Shaan Puri: One source of problems rather than 10. All right, another one you have here: consistency is underrated. You’re on the consistency train. What’s your take here?

Nick Huber: Yeah, I think it’s really easy to get excited about something and jump in and be delusionally focused on one thing for one year, even two years—whether it’s business, a certain idea, your physical health. I know people who are either running a marathon and cutting calories and super fit and super clean, or they’re totally falling off the rails and doing the opposite while they’re focused on something else. It’s kind of sexy to just jump in and be totally obsessed with something.

The people who win are even-keeled. Maybe they’re not working 70-80 hours a week. Maybe they work 50 hours every single week for their whole career or even 20, 30, 40—whatever it is. But it’s hard. It’s hard to stay excited about something for a long time without getting burned out. But I think it’s a superpower. If you can be even-keeled in all areas of life—I’m not just talking about business, but mostly business. If you can just keep from gaining weight the first time, it’s going to be a lot easier to stay healthy the rest of your life. If you can just stay focused on one business or a certain way that you do things and get after it, you can really win. I know a lot of guys who are either kicking ass inside their companies or they’re totally checked out and ignoring the hard decisions.

Shaan Puri: Yeah. How do you get there? You get there because you didn’t understand how to have a sustainable burn. You had a bonfire and then it goes out. I used to be in college a proud procrastinator. I would wait till the last minute, I’d pull an all-nighter, I’d study, I’d pass the test, and I would wear that like a badge of honor. It became a terrible habit and sort of identity to build around—this thing of: “Oh, when I turn it on, I have this crazy intensity. Nobody can work harder than me for that 72 hours.” But then I’m going to crash and I’m going to procrastinate because I know I always have that in the tank.

It’s the tortoise and hare thing where you just realize that the tortoises win in life. The tortoises that just keep putting one foot in front of the other every single day, they win. I’ve actually far shifted my philosophy where now when I hear about somebody who has that same attitude I used to have—the badge of honor of how hard they go and how crazy they’re working—it’s a sign of weakness. It’s like: “Oh, you just don’t have systems. Oh, you don’t understand leverage. You don’t have good judgment. You don’t know where to put your energy, so you’re just putting it everywhere.”

I used to be that guy. I slept in the office when I was 24 years old. I remember I slept in the office 224 days out of a year. I thought that was me grinding. Actually, it was me highlighting to everyone, waving a flag saying, “I’m an idiot. I don’t know what to do.” So, I’m just here all the time just manically doing anything I could think of.

Now, I have a totally different productivity routine, which I call the “one big thing” method. Every morning I decide the one thing that matters that I’d get done today—the one thing I put all my core focus on—and I give myself two hours to focus on it first thing in the morning. No distractions, don’t check stocks, don’t check the mail, don’t check Twitter, don’t check anything. I just focus on that one thing for two hours. After I’m done with that one thing, anything else I do in the day is gravy. I can go play with my kids. I can go work out. I could do a little more work if I wanted to. But it doesn’t matter.

The person who wakes up every day, 365 days, identifies the proper single thing that matters and puts full focus on that one thing for even a two or two-and-a-half-hour time sprint—they will crush the average person who simply doesn’t even identify the one big thing. Because if you do that for 365 days, you have a hell of a year.

Nick Huber: It’s the ability to zoom out. So many entrepreneurs are so focused, they’re so intense, they’re so jammed up in the weeds inside their company. And look, sometimes you got to do that. I’ve been in the weeds in several of my companies. But the people who can really zoom out—like you’re saying, what really matters here—and you do that for four or five years, 10 years, 20 years… man, Father Time. It’s really sexy to build businesses fast and it’s exponential growth and you hear about all these stories. We read about them and it takes over media, especially social media.

Shaan Puri: Well, you’ve seen that meme at this point. It’s not supposed to be a meme, but it looks like a meme now. It’s like: “Fastest company to 100 million ARR.” And it’s these charts and it’s like, “Well, Slack took seven years.” And then it’s like, “We did it in two weeks.” There’s the new AI company that’s got a straight line up and then somebody else comes in and says, “We did it in two minutes. We did it in two seconds.”

They’re all trying to just beat each other to this sprint to low-quality revenue. I think it’s so funny. It’s like in The Big Short where he’s like, “Why are they confessing?” And he’s like, “They’re not confessing, they’re bragging.” I think they think that’s a great thing. The more impressive chart is the one that looks like Qualtrics. We had the founder of Qualtrics on. He said he has a huge sign in his home office that just says: “Tune out the noise, play the long game.”

He was like, “Dude, for seven years, nobody cared what we were doing.” We were single-mindedly focused on getting 150 universities to use our thing because we knew that was super important. If we did that, we had a real business. It took us time. But we just stayed scrappy. We stayed focused. We just did that for years before we ever got any press, any social media, any anything. That’s who you don’t want to compete against—somebody who can do that because they’re building this giant foundation. It doesn’t mean go slow. It just means don’t get fooled into thinking that you need to quickly sprint and just grab some revenue number out of thin air as what success looks like. Success is this durability over time.

Expectations depend on your last six months, your last 12 months, your last two years. If you’ve had that hockey stick exponential growth, think about how you have to follow that up. I think some of those entrepreneurs dream of a world where there’s no investors, nobody watching, growing slowly over time, building something sustainable.

AI Skepticism and the Energy Crisis [00:48:45]

Nick Huber: Yeah. Being a YouTuber is the hardest job in the world. I think some coal miners might disagree, but go ahead.

Shaan Puri: Well, I think social media is changing. We can talk about how the X algorithms changed, how it feels to be a content creator is totally different now. You almost have to be video first. I don’t know if you feel this, Shaan. If you aren’t on YouTube, you are not growing right now.

Nick Huber: That’s true. I think there’s always exceptions, but it’s largely true. And I’ve said this before: video is the native language of the internet. It’s like going to a country. If you don’t speak video, then you are not going to be able to communicate because that’s what everybody here speaks. Short form, long form, doesn’t matter.

Shaan Puri: As an entrepreneur, I’m really hesitant to get on that hamster wheel because I see what the life is like. Okay, you got this banger video, your influence grows, you got to follow it up the next week, and the next week, and the next week, and you got to be on. Then we go back to that consistency conversation. Living that life for 10 years—how would that look? How would that feel? I think it’s a very difficult job. I have a ton of respect for people who do it. I think it’s still worth it, but in my opinion, the value of a personal brand on all things not video is going down.

All right, one more spicy opinion here. This might be the spiciest of all: “AI is shit and unsustainable and will decrease quality of life for the 99%.” Wow. Say some words about that.

Nick Huber: This is just like the internet boom where 0.1% of the companies will survive whatever happens when the bubble changes and will go on to change the world over the next 20 years. I’m not doubting the long-term power of AI. I’m just looking at the money, the hype, the energy that’s being poured into it. I’m spending a lot of time inside of my companies trying to implement AI. We’re adding tools and I’m just not seeing it, Shaan.

AI is unbelievable for me having a doctor in my pocket or me doing recipes or my wife doing little things, but man, where is the long-term value? And then when I think about where it’s going and I’m seeing my energy bill in Athens, Georgia—which is not an area with an energy crisis like some areas of Texas and California—my energy bills went up 60% in the last three years. They’ve raised it six times.

Shaan Puri: Wow. And that’s because what? Data centers being built?

Nick Huber: There’s 30 data centers that have come online in Georgia in the last four years. There’s still 30 more in the pipeline being built right now that have negotiated unsustainable energy rates with the local municipalities. Where does it stop before the companies are able to put AI in place to replace employees, but the energy cost—and this is why I think for 99% of people it could get really ugly—what about your ability to run a dishwasher or run an air conditioner or run a heater in your house? All require a massive amount of electricity that gets more expensive for almost everybody. You have less money to spend on other things to make quality of life better. So yeah, hot take, but man, I’m very bearish on AI right now.

Shaan Puri: You said it’s shit and unsustainable, but you also said in the next 20 years it’s going to change everything. So it’s not that you think the long term is—you’re saying that something today is overpromised. What is it? You’re saying personally you’re getting value—doctor in your pocket, recipes, life, day-to-day stuff. It’s the business use that you’re not seeing?

Nick Huber: I’ve added 15 AI tools across my portfolio. We’ve canceled 11. There’s some that I really like. The others I’m just like—really, really hard to justify the cost already and they’re subsidized all the way down the chain. Nvidia is selling the chips; they’re making the bank. But Amazon cloud services—they’re subsidizing it all the way down to the actual company that’s VC-backed that’s subsidizing the data usage to try to do the land grab.

It’s going to get more expensive. And I also feel it’s like the electric cars and self-driving with Elon Musk—how he’s been promising us for 20 years that self-driving is five years away. It’s going to get harder and harder and harder to continue to improve AI from here and require exponentially more energy. I worry about energy mostly. If we had nuclear power plants all over the place, I’d feel much different about AI.

Shaan Puri: Do you have a Tesla?

Nick Huber: As soon as they make a Cybertruck that doesn’t look like a Cybertruck, I’m all in. I want full self-driving. I know how safe it is. I’m not willing to drive a sedan because they’re not safe.

Shaan Puri: Dude, I bought one. The self-driving is unbelievable. It is so good. Before I bought this car, I also thought the narrative was: Elon’s been promising, he hasn’t delivered it, it might be harder than you think, maybe you can’t even do it without LiDAR. And then I buy the car, I push the button, and it drives me everywhere flawlessly. I’m like: this is here. This is already working. This is incredible. And I think the data backs up the personal experience.

Nick Huber: I have ridden in full self-driving and it is mind-blowing. It’s mind-blowing. I want it. I need it. But is it going to be widespread? Are we going to have robo-taxis like San Francisco all over the country? I still think we’re 10 years away from it. And Elon said it’d be 2012 that we were going to have this happen.

Shaan Puri: Yeah. His timelines have been wrong. But I think that’s less to do now with the tech and more to do with the regulation at this point, which I think is a different question.

The Power of Boring Businesses and Real Estate Carnage [00:54:15]

Shaan Puri: You mentioned pest control. Are there other businesses that you found interesting or you’ve been surprised at how well they’re doing? Or a niche that you nerded out about a little bit?

Nick Huber: Everybody wants to start a marketplace. I get maybe five or 10 DMs a month of somebody saying they found—there’s a kitchen cleaning business where you go in at night and spray down hoods and clean the inside of a kitchen. “I want to start a marketplace that connects restaurants to these people.”

Then I was doing my roof on one of my commercial properties and our bid came in to do this roof. It’s about a 10,000-square-foot warehouse at about 70 grand to do the roof. And I’m like, “That seems high. Let’s do some more work.” I found out that I can hire a sub for 30 grand worth of labor and I can buy 15 grand worth of material. That’s the hard cost to do this job. These roofing companies are making the spread. They literally don’t do any work. They sell the job. They quote the job. They carry insurance. And then they show up and stand there and watch and make sure the crew does a really good job and make $20,000 in a two-day job by getting a sub and actually selling the job, putting their name on it, billing the customer, collecting the money, paying the sub, and moving on. Is that sexy and exciting? No. But are there roofers running around every town in America making five or 10 grand a day? Yes.

Shaan Puri: Dude, I’ll give you a fun example. At my daughter’s school, I’ve gotten to know some of the other parents. “Oh, cool. What do you do?” One of the guys does—and I’m so lack of handy that I don’t even really know these terms—but he does framing. Framing, I think, is like wood, but you frame the building that you’re going to build. I was like, “Cool. So, how’s it going? Where’s the project? Have I seen it? What do you do?” He’s like, “I do hotels.” “Is it one I’ve stayed in here?” He’s like, “Well, I do all my work in Alaska.”

I was like, “Alaska?” And he’s basically like: work smarter, not harder. His take was: “Look, I can be the thousandth best framer in California right now, coming in as a new guy into the space who doesn’t have 20 years of referral relationships with all the other contractors and try to scrape and claw, do business with expensive labor here in California and be competed down to the bare margin because they can bid it out to 30 guys and whoever comes up with the lower price option is going to win.”

He’s like, “But if I go to Alaska, it turns out they just don’t really have any very many framers. It’s easier for me to get on a flight once a month and go to Alaska than it is for me to build that business here.” Munger has this great quote: “The secret to winning in life is weak competition.” It’s basically: go where there’s fish but not other fishermen. It feels like it would feel so foreign to me and most people if you’re doing a business to be like, “Well, how do I—I live here. I kind of feel like I should do something familiar where I see it.” We will go into a knowingly harder situation because it’s more familiar than take on some unknown where there might be a total greenfield opportunity. And he’s not innovating. It’s not like he had to use some new technique in framing. He just went to a place where there’s just not a lot of people offering that service.

That one principle—if you’re a hard-working person—can be the difference between being the thousandth contractor here with razor-thin margins and making great margins and having to get on a flight once a month. I think about a lot of people in my life who could benefit from that principle of just go where the supply is low or the competition is low because it’s unfamiliar for most and you might prosper.

Nick Huber: We built our first self-storage facility six hours from where we were living. Borrowed $2 million from a bank. Spent $3 million to build a self-storage facility six hours away. And now I’m in Athens, Georgia, which is another different city. People are like, “Oh, you have—you’re in the self-storage business. Which one in town do you own?” And I’m like, “They’re nowhere near here. I’m sorry.”

Shaan Puri: In storage, what was the insight on location for you? Did you find a certain strategy on location worked well for you?

Nick Huber: We didn’t even talk about real estate. It’s been a chaotic three years in real estate as interest rates have risen. Just total carnage in the business. Luckily, we’ve done some things operationally that give us a little bit of an advantage.

Shaan Puri: Explain why that is. For somebody who’s not in real estate, why do interest rates going up create carnage in the real estate market?

Nick Huber: Because the biggest line item—the biggest expense for a real estate investor, developer, syndicator, anybody who buys real estate and holds it and tries to cash flow—is debt. It’s our biggest line item. We’re going to borrow anywhere from 50 to 70% of the value of a building. If you go from paying 3.5% on that debt—35 grand to service a million dollars in debt—to paying 7%, which is 70 grand… imagine if your labor cost quadrupled in a service business. That’s essentially what happens in real estate.

It drives the value what people can afford to pay down. All the buildings that you bought in ‘21 and ‘22—there’s guys that are going broke in the real estate business right now in real time that I know. It’s total carnage because they can’t sell their buildings for what they were worth because nobody else can afford to pay that higher amount of debt interest either. Does that make sense?

Shaan Puri: Right. What’s going on with your properties now? Because that was the time when you were buying, too.

Nick Huber: Yeah, we bought a lot and we had some stress, dude. We had some tough conversations. We got out without raising any additional money from our investors and we replaced all of our loans—meaning we refinanced them and we didn’t have to call a single dollar from our investors. That’s a massive win. Many people else are calling capital calls or they’re actually losing properties. We were able to increase revenue quite a bit when we bought a building and we’ve done things now like we replaced our inbound sales team with South Africans who are actually sales trained and our conversion rate went from when we were in the Philippines from 30% to 42%. Revenue is up 15% year-over-year. But yeah, man, it’s not easy. It’s brutal.

Shaan Puri: Is the future for Nick Huber buying more storage facilities? Is it just running Somewhere and growing that? Is it something else? Five years from now, what’s the future for Nick?

Nick Huber: You know, my ego has written a lot of checks over the last five years. Now I got to go cash them. No, I’m pretty focused on growing Somewhere. I want to grow RE Cost Seg and I want to buy more storage. We have a couple deals under contract now. The company’s in a good place and there’s just so much less competition in the real estate business right now. It’s a double-edged sword.

I just think business is naturally cyclical. There’s really good times and there’s harder times and sometimes the hard times are good because you got to buckle up. You got to operate. You got to make things to make your business more efficient and it washes out the people that can’t do that and it becomes less competitive. I’m genuinely excited about the real estate business over time. I think we’re better than anybody in the world at finding amazing talent at Somewhere. And yeah, so I’m going to grow some of these companies. I want to grow some of them really large.

Shaan Puri: Very cool. Well, man, I appreciate you coming on. Always fun to catch up.

Nick Huber: Good deal. Thanks for having me, dude.

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