Episode of My First Million with Sam Parr and Shaan Puri.
Transcript
Note: This transcript was auto-generated from YouTube captions. It may contain errors and lacks speaker identification. A full Gemini audio transcript will replace this.
Kind: captions Language: en by the way by the way first unicorn officially today one of my angel investments officially raised at over a billion dollars i feel like i can rule the world i know i could be what i want to all right everyone we have uh a great episode but first before we get into it i’ve got a huge favor um there’s this new feature in the itunes store um so i want to show it to you i want to be one of the first to use it so go type in my first million or hopefully you’re already if you’re not if you’re on an android you can ignore this for now or you got no a matter of fact you can do this for spotify so go to your itunes store right now um or your podcast app my apologies podcast app type in my first million and find our podcast and then you’re going to see a button it should be blue on a podcast and it says subscribe click that button and something really amazing is going to happen and i want you to tweet at me the sampar with a picture of that and uh we’re gonna you’re gonna see this brand new feature that apple just for launch it’s it’s a really cool hack that we just discovered so click that button and tell us what’s happened this is what they were talking about in the keynote yesterday right yeah it’s like a big deal only a few people got access to it i knew a guy and i got access to it so go ahead and click that subscribe button and if you’re in spotify uh i talked to daniel l he actually they’re releasing something too click the button that says daniel the cousin of daniel eck the actual founder of spotify right it’s their cousin it’s a norwegian thing or uh you know uh swedish thing whatever he is it’s a scandinavian thing um anyway today we’ve got a great episode sean who do we have we had elaine zelby on she’s a vc at signal fire and um more importantly she is an ideal woman so she has a sub stack that’s three new ideas every week uh very much like what we do she also does this thing called i don’t know what it’s called but it’s a podcast about boring businesses like unsexy it’s called unsexy unsexy it’s about like you know oh you run a chemical plant tell me about that you know so things like that so very much uh in line with what we do we had a bunch of uh we brainstormed a bunch of ideas so we talked about ideas the adulting vault we’ll tell you what that is um the smoo sleep uh sleep bed for adults uh therapunch was one of the ideas a subscription shoe company idea and um and there we go that’s one with the the startup sas bundle that was the best startup sas bundle and also she kind of gave us a peek under the hood signal fire has this thing that’s like a this data machine that spits out like you know great investments using all the 27 different data signals and we were kind of asked her like hey is that [ ] is that just marketing seems like it’s just marketing is that [ ] and uh she gave a pretty good response so we kind of talked about that as well all right we’re gonna get to the episode but first remember go to the uh the podcast store click that button that says subscribe and then you have to send me a picture on twitter the sampar and you’re gonna see this new feature that apple released i promise it’s gonna be worth it so make sure everyone does it right now thank you so elaine hey what’s going on uh i’m sam parr we haven’t met i think you were on the podcast before when i was sick um so sam last time she was on she had one idea that well two ideas one that went kind of like semi-viral that was the milk bombs idea of like a functional milk bomb uh i don’t know if you even know what that means like yeah you get the you get that the picture basically you dunk a little like a bath bomb you dunk it into your milk and it sort of has a little fizzy color whatever experience and you’re adding some uh some adaptogen adaptogen people like that one a lot but now that we have like these viral video people oh it would be on a whole nother level now yeah should we ask her to yeah is that like that’s like a pretty virally thing but sorry go ahead we’ll do that and the other one i really liked was um fantasy football for stocks so basically creating a little game like let’s say we could create a game me you andrew whoever and um we each get our a budget we we allocate it into a portfolio that you you get to change it every month or so and then we see whose portfolio would have performed the best like fantasy football where you get points based on the you know the ups and downs of the stock so a very social you’re not actually investing it doesn’t have to be real money a very social way to be gambling or betting on on stocks what do you think of that one sam i used to do that as a kid didn’t we do that as a kid in like class there was a thing back in like seventh grade i think everybody did this one fantasy portfolio for like a month at school and uh but it hasn’t it was it was pretty rudimentary then and it never made its way out so i think somebody who worked at yahoo fantasy football they should just basically fork everything they learned about how to make yahoo fantasy football viral and be like cool i’m gonna do that except instead of you know the patriots it’s gonna be you know amazon and tesla and whatnot did you folks um have you guys used uh is it called the they were one of our sponsors uh was it weeble what’s the israel israeli coinbase competitor israeli coinbase israeli yeah they’re yeah one of those words is wrong uh coinbase it’s an exchange crypto yeah yeah well it’s but they um i think it’s weeble um but they have this feature so basically it’s like a stock investing platform i know about we bull like bull yes yeah yeah yeah is that the one but anyway they have this feature where they have this thing where you can sign up and you can choose to share your portfolio with anyone and people can copy you and i thought that was kind of amazing uh it’s kind of like turns and you like invest in their fund and i don’t even think they make any money off of it but it’s just like there’s a bunch of these that came out in the last i don’t know two years elaine you’ve probably seen all of them public came out as like one of the robin hood competitors where it’s like a social network a social feed where you can see what people are investing in then there’s the more extreme versions like what you’re talking about like uh doji i think is one of them and in doji i create kind of like my little basket of stocks and i call you know the sean index and you could just straight up buy the sean index and you can invest in all my stocks and i get kind of like it’s like my index becomes more popular because you’ve invested in it and you trust me and it like shows that you follow it or you invested in it well in 2017 so eric voorhees who was the guy that created shapeshift he actually created satoshi dice he was super super early in the crypto space he launched something that never got out of private beta called prism and you could create a basket of tokens this is when all the altcoins started popping up on ethereum and you could show so it could be you know sean’s basket of tokens and sams and you could watch and i could follow you and i could just invest in your basket of tokens but it was a competition too and i thought it was such a great idea i’m not sure why it never got off the ground but it was cool i digged it can i ask you elaine what is signalfire i’m on your website um your landing page is i want whatever you’re selling but i’m still a little confused as to what it is so we do that a little bit on purpose we are a venture capital firm but we’re actually structured and operate a lot more like a technology company so if you look at our team we’re about a third engineers and data scientists building products we’re about a third people on our platform these are the in-house business people doing pr recruiting growth and then we have investment and we you know we essentially monetize via the investment vehicle and we’re currently investing on our fun three which is 500 million dollars but you know we’re not we don’t have capital in the name we don’t have ventures in the name we definitely try to be a little bit more startupy than the traditional vc so but are you using like on your web page on the landing page it’s like you guys use some type of data to spot trends is that is that so we buy scrape or you know aggregate every data signal you could possibly imagine and our engineers have proprietary algorithms that use that data to do one of two things one we have different systems that are alerting systems for us on the investment side so they pull in all these signals and they try to show us at seed at series a and at series b who are the cool companies what should we be looking at and also trends around markets and things like that fundraising trends and then we have a bunch of products for the portfolio around talent migration talent movement who’s good who’s in market from a hiring perspective competitive intel co-spend analysis market intel all that kind of stuff do you so like when a lot of people like when sean and i probably have both started our things um which like granted by the way by the way first unicorn officially today my one of my angel investments officially raised at over a billion dollars although i gotta say it’s not super exciting because it’s a company i was trying to invest in from the seed but at this point i wasn’t like a and i was running my company i wasn’t like i was i only wanted to invest i thought it was a great idea and i like the founder but i like forgot to follow up and then like oh i followed up he’s like oh dude we closed that like two months ago sorry i’ll get you in the a and then when the a came around it was like oh dude it’s super competitive sorry i’m not gonna be able to get you in so finally he messaged me he was like hey man i’m gonna make sure i get you in this time i feel like i i [ ] you over you know once you missed it the first time we’re definitely gonna get you in here in the i don’t know the b yeah the b round at a 200 million valuation i was like bro 200 million i knew you when you were a baby here this was this is way too high all right [ ] it i’m in and so uh that company is now worth over company um i don’t know if i could well we’ll say i might i might bleep it out come on you have to tell we may have to bleep it out because he may not have announced it yet but it’s a company called deal and they do my husband and i were talking about that one this morning yeah okay what were you guys talking about my first unicorn because i appreciate that yes the joke is this is essentially a company i wanted to build three years ago and i started seeing every startup that had 10 employees was starting to hire internationally and they had to treat them as contractors and there was no way to manage it and if i looked under the hood most companies were using shield geo as the peo and everyone hated it super old school so i was like okay somebody needs to go and build a better shield geo under the hood do kind of the plaid model of building the nitty-gritty going into each country that people in the us hire remotely with and build out the you know infrastructure go and find every startup and say hey we’re going to handle all the hiring the payroll compliance everything for your remote people i love it i think it’s such a good idea wait so what sorry how do you spell it sean d e e i think the url is let’sdeal.com unless they change i think they got deal.com also now oh cool so i actually use it uh that’s how i pay kind of like any contractors that i work with even if they’re in the us i’m like oh this is way easier because i just type in their name i say what the contract is every month i’m going to pay them this at the first of the month it’s like would you like an mda with that i’m like yeah why not let’s add on an nda they’re like great would you like to add a milestone based payment i’m like you know what that’s a good idea i do like milestone-based payments that’s that aligns our incentives it’s like boom here’s a contract we’ve sent it to them when they’ll sign it it’ll be kept in your records automatically for you we took care of all the the compliance and tax issues that you’re gonna have to deal with based on where they live and um we’ll connect to your bank and then it’ll auto pay every month for for you and send you an invoice when you’re done and i was like oh wow that’s great you just eliminated the need for me to have like a person who does that whole thing by the way it’s on their page that they’ve just raised money at a billion dollar uh valuation so their biggest competitors so there’s two big ones papaya global and remote.com and deal started out a little bit differently the other two said hey we’re going to really focus on full-time employment internationally they focused on contractors and they’ve had to shift from my understanding a little bit because in reality you don’t just have contractors for the most part and you want one-stop shop you want to go and have different solutions for the different types of employees right so i think they now have everything exactly that’s everything they also let you like pay in crypto and pay in every currency and like you know they’re do they’re doing all those kind of gnarly problems which is great uh i almost invested in remote.com also i really like that guy uh his his name is job uh the guy who’s like this founder i think it’s pronounced something like slightly different but it’s j-o-b and i just like i love that whenever it’s like usain bolt is the fastest man in the in the world i’m like this guy named job is is creating the platform for hiring remote workers like okay i’m in i’m interested and he was like interested in this company deal uh as soon as i heard the idea i was like oh yeah that’s a pain point like that’s a real pain point and i don’t know how people solve it but if i look i went to their website i saw it was like it’s real similar i’m not that sophisticated right it’s like yes this is a real problem then i go to your website and i’m like oh you’re one of the easy to use products which is like just kind of the standard best practices of design and like clear like good colors good font clear copy two clicks and you’re done and i was like oh yeah this is gonna win and so then i started hitting up the founder and i met with them and i was like oh this is amazing let’s let’s do something and then like unfortunately you know this would have been a much much bigger return had i just been like a little bit more proactive about following up before but you know i feel like i’ve learned that lesson 30 times you invested ten thousand dollars in them let’s say um would that mean that it’s worth like what five times more well at the current valuation yeah um on paper on paper yeah um uh but if i had done it at the seed it would have been you know maybe i think the seed was probably like 10 15 million um coming out of yc and so you know that’s that’s taking 10 million turning it into a billion in terms of the multiple uh plus dilution blah blah blah not that interesting more importantly i can now say i invested in a unicorn so that’s just a stamp that i needed to collect here also i appreciate your honesty that you invested at the b because so many people will come in at later rounds and be like i’m in all these unicorns and they invested in the previous round what i wanted to ask though was elaine so when i started my company i just was like this seemed like it could work and it’s fun and i’m good at it i bet sean kind of did the same i bet where’s like uh yeah it might work signal fire seems far more um analytical my question is in reality do you actually think that that matters like if i’m trying to start something do you actually think that the likelihood that i’m going to succeed by but if i just said elaine um give me three things to start versus i’m just gonna go do whatever is do you think that you would let me give you an example here of like honesty so when i started my rolling fund the marketing was i have this big podcast that’s going to help me get deal flow and podcast well okay if you have a podcast that does 5 million downloads a year in the business nation startup niche it’s like okay that’s a unique asset i see how you’re different than the other funds in reality most of my deals don’t come from podcast listeners sending me stuff or reaching out to me most of the deals are from the same five friends who email me when they see something cool and like that would have been much less sexy to talk about like oh i have five great friends who will email me cool stuff and i email them cool stuff but in reality that’s how the best deals happen and or just like i’m bored on twitter a lot when i see something cool i reach out again doesn’t sound that great for my fund marketing but is closer to reality so the question is basically how often are your deals because you’re like computer programs like dude this company under value growing fast nobody’s heard of it versus another fund share something with you or you guys are interested in space and you see something cool on product owner or whatever and you reach out and then that’s how it happens so can you give us the truth well so in general venture capital i have the most commoditized asset you can imagine that i’m selling i’m selling money and so in terms of differentiation you talking about having this podcast having a different model and differentiation does go a long way but if i break up venture capital into five stages it’s sourcing so how do i find people diligencing picking winning and then supporting and so we try to leverage data in probably four of the five different categories on the sourcing side we’ve definitely done deals that were completely from our alerting system in addition we just do a ton more outbound than the average firm because we’ll go in these meetings and we’ll triage based off of oh this looks interesting and oh elaine is connected to the founder or elaine knows about this industry you go follow up right so we do a lot more of that outbound than traditional is it the majority of our deals no on the diligencing side really trying to understand how good are these people so giving people you know talent scores understanding hiring patterns mobile app downloads alexa score trends a lot of the stuff you guys look at in you know the similar web or a-refs or that kind of stuff we’re just doing on a different level but i would say where we have the most value does that level actually matter so you you basically said that you you must listen because we i talk about aha reps all the time we talk about similar webs all the time that’s like anyone could do that for either free or for 100 a month and it’s like i could just skim it and i kind of have an idea you kind of implied that you do that times 10 or whatever it is is that way actually better than our way i think in our industry it does actually move the needle for us so give us an example like you know if i’m watching billions and i’m like oh [ ] bobby actually you know he gets satellite data and he can see you know how many trucks are leaving the factory every day and that’s how you know blah blah blah i’ve seen some things in vc where it’s like you know everybody’s kind of got app annie or whatever like something to look at app growth but you know i don’t know second measure where you get credit card spending data aggregated that can be more interesting or like you know if you’re plugged in with pipe or somebody you could see recurring revenue businesses that are growing in some way before maybe others do so i’m curious what’s a cool data source that give me an example like oh we have this one data source and that helped us spot this cool company can you tell a story like that so it’s not the one data source piece it’s the fact that we buy or have access to all of them and then we combine them in unique ways so it’s really about the joining of the data and what that surface is for us and that could be again on the you know we we look at things like business filings and then we combine that with data on okay well what is their website what are their app i can download that you know somebody is a founder based in san francisco they just incorporated their company as a delaware c corp i can then know when they filed for incorporation i know who the person is i can put them through our talent ranking score or our founder ranking score i can then see who are they working with how good are those people what is the business category how interesting is that for us how investable is the timing so we have a kind of timing alerting system too those things combined will then give it a score and saying okay this one you should look at versus when you shouldn’t based off of the aggregate score and that’s the piece that i think actually helps not the single data set or the single piece of info you guys have a score can you give me my founder score what am i i could but i don’t think i’m allowed to oh come on what’s going on here this is the best marketing ever for signifiers i know we do we actually do score uh we give people ranks it’s uh you know one is like the number one person we think in our list right now and then it kind of goes down so it’s like a chess ranking it’s like you know there’s like like an elo score basically or something where everybody is actually ranked one to one million or whatever pretty much yeah exactly and it changes what’s going on no because it’s for us like we only invest see in series a and series b so i don’t care about people in those other categories i want to know who are the best people starting companies right now that are actively looking for funding gotcha that’s the timeliness is actually really important but the thing that’s also really cool about what we can do so i’ll give you a really concrete example we have a company that is in the shopify ecommerce infrastructure ecosystem and they were looking to say hey we want to go and target i’m going to make these numbers up but we want to target every merchant who has between 10 and 100 million dollars in revenue in these four categories and here are three buyer titles oh and like here here’s where they need to be located we can go and pull all that data we match that up to the people at the company so we say here their email addresses here are the people you should go after after and we create this kind of custom lead list for them and so being able to do that really really really that’s on the support the company said so and you guys sell access to this platform right like this is a product no yeah no that’s one i was gonna ask you because why i mean i bet you can make uh like 50 to 100 million dollars a year in um bernie told me that you guys are spinning this out or considering spinning this out as a product we do not sell it and we don’t spin it out that’s part of our whole selling point is that this is within the family so if you come and take our money and become part of the signal fire family you get access to all this stuff so we don’t actually give it out outside of it interesting okay who uh who came up with this so our founding partner chris farmer has a long history in the vc world and he kind of got frustrated saying why are we investing in these bleeding edge tech companies and we’re literally doing deals by talking to our friends kind of what shawn was alluding to and so he’s like look we have access to all this data why are we not leveraging it and so he had kind of spun this out in his last firm and then created an entire fun cycle around it and a firm around it yeah i’m going to say i still think it’s 50 marketing and 50 useful but that’s higher than it was in my head an hour ago where i would have said it’s 90 percent just marketing and 10 useful so you’ve done a good job you’ve moved he’s right elaine 40 please say that again is he right in terms of what it is uh i would say more useful than not for sure especially i think the two areas i would say it’s on the barbells it’s definitely useful on the flagging sourcing companies that we would never have seen and it’s very very useful on the supporting side and honestly we’re as i mentioned before you know we kind of like say we’re a startup we do okrs we measure nps score we kind of treat ourselves like a tech startup in terms of how we operate and so for us we care so much about our nps we care so much about are we moving the needle for founders so if we can be you know if that’s the only place that it’s really valuable that’s that’s enough you know that’s that’s really enough right now did you ever hear about chamoth’s uh eight ball yeah yeah this sort of reminds me of that yeah go get this is this is going to be a clip i tell go for it uh yeah so so chamath who was you know founder of social capital or is the founder social capital at one point in time was like look we uh he came from facebook super data driven growth team he was like leading the growth team helped grow it from whatever 100 million users to a billion users and he was like well why don’t we have that same level of analytical rigor when it comes to our companies and sort of as that thought evolved it came down to something really simple he goes let’s make capital as a service uh instead of you know software service capital as a service so here’s how it goes it’s self-serve you come and you plug in your analytics our little algorithm will run a formula and it’ll basically tell you two things it’ll say here’s how you rank relative to other sas companies that are your size your age in your kind of like price point or your demographic and then so you’ll know if you’re above the benchmark if your retention is way better or way worse than other companies and then secondly they were like this is our moneyball formula to basically figure out if we should invest in you or not and um and so that they hyped it and as a founder it was a little bit scary right you’re going to go am i going to give to moth like all my data basically pipe right into our database and just say hey here you go and it feeds their system right because whether they invest in us or not they’ve just downloaded hey at this point in time here’s how this company was doing and then they take your historical data as well so it’s like they sucked in all this data so that if they looked at the hustle they’ll know whether they should invest in the hustle but also morning brew and the skim and any other company like the hustle they’ll be able to compare and contrast and as a founder it’s useful because you want to compare and contrast but you’ve just uh you know you’ve opened up your blouse to tichimoth and i think that that was for me a little bit scary but i think um some people really liked it and ultimately i think it was more marketing than than substance i don’t know elaine what’s the word on the street but like i don’t see them using it anymore i know that the group of people that spawn off of chamoth like uh arjun and those guys from tribes i think they still do that or that’s a big piece of it they don’t maybe brand it that way but um i don’t know elaine was was that like was that legit was it as secret saucy as they tried to make it sound or was it a little overhyped i was never on the inside so i have no idea i know that it was very polarizing in terms of what you were saying some founders loved it some founders hated it in my opinion it only works at certain stages and in certain categories this does not work at all at the seed stage you’re betting on people for the most part and you’re betting on the growth of a category there’s no data there’s nothing that’s going to give me by the way most startups don’t have their data structured enough or in a way that you can actually like run these types of to apples analysis until you’re ready clear bank clearbank makes sense to me because you’re literally saying hook into my facebook and google data there’s nothing that i could be yeah and there’s nothing i can be fudging around that i’m gonna go analyze it and say you put in 10 to facebook you get out 15. i’m going to give you a short term high interest loan it works for everybody we win people are now doing this for amazon sellers and to your point shopify so on amazon it’s much more around working capital so people are constantly in these manufacturing cycles where cash flow negative so they’re like okay well i can hook into your amazon seller portal i can see exactly what your you know inflow and outflow of money is i can hook into your bank account i should be able to do dynamic loans so i’m never at peak you know peak exposure from a loan perspective for very long i’m kind of like constantly pulling it in and pulling it out that makes a ton of sense to me yesterday i invested in a c stage company and i pretty much only did it because sean did it um i basically i was like i think this is silly are you in he goes i’m in i i if you don’t want to go in ask him if i could have your your i was like i love it and he’s like yeah i don’t know i think i hate it i was like what’s there to hate it’s amazing and then he’s like yeah it’s so good that i kind of hate just popular things it seems so good and i was like that’s the stupidest thing i’ve ever heard i said if you don’t want it give me your share and because i was asking the founder for more it was hypey it was hypey it’s got all the cool kids in it and i’m like oh all the cool kids are doing it i don’t want to do it but sean was like well i’m doing it and i talked to the guy and the guy seemed wonderful and i really don’t even know can we talk about the company now or do we need to talk about it next episode so that there’s a little distance between this combo and that uh yeah yeah i guess okay it’s called synthesis do you know this one no what do they do ah the algorithm didn’t spot it but hey the uh five friends did did uh did spot this all right so this is a cool company so the uh the story of this is have you heard of ad astra which is like elon musk’s personal school that was inside spacex so for those who don’t elon musk you know he’s ceo of spacex the ceo of tesla two kind of like multi multi-billion dollar companies and um his kids were going to school he basically needed to have his kids be in school and he kind of was like you know the traditional school system is not so great why don’t we build a school inside spacex that’s um done the way we think and his his big kind of like theory was in schools they teach you um like here’s this tool right like let’s say calculus or algebra right like here’s algebra go learn algebra but they don’t tell you kind of like why you need to know algebra right like maybe they should be teaching you how to you know run a lemonade stand and in order to calculate how many lemons you’re going to need per day boom we’ll teach you algebra that’s a tool to help you do this thing you wanted to do so his his big thing was why don’t we teach kids how engines work rather than how what a wrench is uh as like a basic analogy and so he creates this the school um or he wants to have the school and he creates it and there’s a guy i think josh is his name he runs the school at spacex it’s great it’s kind of like well known and the kind of the fundamental premise was kids were learning by by really but like playing games and so uh have you guys seen the movie ender’s game yes so in ender’s game you basically you’re in small teams of kind of kids and then you go into one like simulation area where you’re gonna you know your teammate fights against team b and c and um the game always has like some kind of like arbitrary set of rules but it teaches you like strategy and teamwork and communication and like all the different things you need to do to win the game and so um kids love it because they play it’s it’s competitive it’s like doing not just sitting there listening to a lecture and so anyways those are the same principles they took into this so let’s say they they’ll create a game that’s like i don’t know um it’s about art right so instead of telling you okay here we’re going to talk about art so sit down and read these three chapters about you know the renaissance period of italy and memorize it no instead they’ll create like a map it’s like okay where do you want to explore and then you pick you’re like japan you go to japan and you find this artifact and then you have to bid on it and the other teams are bidding on it too are you trying to decide should we bid on this well let’s go look at it let’s go look at italy let’s see what they have there and the team goes and all these kids are playing this together on zoom anyway so it’s it’s this really cool totally different alternative like form of education and so what ended up happening was the guy who created this at spacex for elon and his kids um the game system was called synthesis and what he did was they spun it out with elon’s blessing elon’s like hey go for it like yeah this more kids should have access to this and he paired up with this guy who was like the number one engineer at class dojo so he had been working at an edtech company signalfire is an investor this is our portfolio company and so they got together and they created this this company synthesis and they um okay i guess can’t share too much of their numbers but they have this amazing traction so far you know business is only six to eight months old they spent zero dollars on paid marketing all the attention has come because of free press and people who are reading about elon school and just sort of click the links and find them and it’s gotten the greatest headline ever which is like elon musk spinning off school right and the defender was very honest he was like you know honestly like we had a big question like does this only work if it’s rocket scientist kids right because like maybe they are willing to like really engage in this material and figure it out and play these things like but is this accessible if your dad is not a you know a rocket scientist at spacex uh or your mom is not like a you know data scientist or uh wherever and so um but they found that you know it does and so they have like super high retention amazing uh revenue already in six months uh you know doing multiple millions of dollars a year in revenue with zero dollars paid marketing and what seems like the perfect team it’s the guy who created the school at elon’s thing and this guy from class dojo and so i was like what’s not to love great impact super cool product i want to send my own kids there great traction in a very short amount of time and like tons of room to grow because they haven’t even started marketing yet and so i was like i love it and sam was like yeah like it seems really great but i’m skeptical of real things that everything every everything’s expensive it was expensive well can i pitch you a spin on this that i wrote about recently and you can you can give this to the guys because it might be interesting for them so i wrote about a concept of doing this but on top of roblox and the reason being roblox already has the eyeballs and the attention of kids 75 of kids between 9 and 15 i think are on roblox and today you know anybody can go and build these games but why can’t you go and build games i was focusing more on life skills so things like financial literacy which you never learn mental health which you never learn all the things that you’d want either a younger kid or a teenager to learn gamify it but build it where they’re already there and also enable the kids to become the builders so partner with some people like these two people doing synthesis bring in some kids to make it actually appropriate and age appropriate and then let them have some of the upside and let them spin off the games and bring in their millions of followers but i think there’s something to be done on top of roblox yeah i love that i think um that works for two reasons one is you can if you okay teaching kids through games not a new idea like when i was a kid i was playing math blaster and what you know whatever else these little games on whatever you know we had a computer room at my house and i used to go there and get to play an hour a day and um so you know teaching kids through games obviously been around for a while but now the games are already built with tons of love uh kids already know the controls like in fortnite or roblox they already know how to play they’re already super familiar with it they already love the game and so and they also have now created roblox and fortnite have these like kind of open field open world systems where you can go build whatever the hell you want and just share the link and so it makes total sense to me to borrow the millions of dollars they poured into their game engine and the marketing um and the distribution where they already have kids with accounts to just say now all we have to build is the learning experience and um and so i think that is a a great idea can i they might be able to port it over you know they can port some of these games to roblox can i ask you about something you wrote about and see so you have elaine has a sub sack uh uh zell is it what’s zelby.subsec.com three things that’s just my last name um it’s it’s cool uh it’s a lot like this podcast you basically put out three kind of business ideas a week right is that the idea exactly i write about three requests for startups or opportunities i see to build big businesses and like how i would do it how i would monetize it and why now great so obviously everyone should go sign up for that because it’s it’s right at this r alley um i think i’ve seen you because you’ve linked to us a couple once or twice and i’ve like tracked the traffic back um all right so you have this thing called startup sas bundle and i wanted to bring this up because i think that most everyone listening is in the world where they can actually go out and start this i think that i’ve actually investigated this a ton so i i have or i don’t own it anymore but we used to own this thing called the hustle so we had like two million subscribers of many of which are like these businessy folks and i’m like oh we should make this and sell it there’s actually a lot of reasons i think why this can’t work at a huge scale but i think there’s a bunch of reasons why it could work at like a i think you could build a five to ten million dollar a year company in like three to four years pretty straightforward can can you talk about your uh ideas here and you can actually tell me if you think i’m wrong or right yeah and i’ll tell you why i think it’s way bigger than that right so the idea here is if you look at the average series a company they’re using i think the status 34 different sas applications and what happened was we used to have these monoliths which are sap and oracle and i used to joke like bring back sap and i don’t really mean that but what i mean is i am so sick of now having to deal with 34 vendors 34 uis 34 logins and passwords you know 34 different bills and renewal cycles and all that kind of stuff it just makes no sense and if you think about what core business software runs a startup it’s very consistent you have things like you need g suite or office 365 you need some kind of communication tool you need something for payroll for hr for accounting for recruiting for like crm marketing project management issue tracking and help desk like those to me that is the core of business software and of course they’re best in breed for all these things at the smb level the mid market level the enterprise level but in reality if you’re a startup that is seed series a probably even getting into series b you need like not the 80 20 rule but like 60 of the functionality and that’s the easier stuff to build the additional bells and whistles are the harder pieces and those aren’t even utilized by these early companies so the idea is look okay if you wanted to build a bundle and get people to migrate over if they’ve already bought eight different pieces of software that’s nearly impossible but if you catch people when they have nothing and you’re gonna say hey we have this out of the box bundle you can start with three modules but as you go and you want a crm because you didn’t have a sales team before just add on the crm module it already hooks in it’s super seamless it has the same user experience no new login no new vendor relationship and you kind of continue to add to the bundle as your needs evolve and break this down though is you said something important that we have to go back to you said something you said it won’t work if you already are using something yes can you explain why because that’s actually a really big deal yes ripping and replacing software is so painful and it’s incredibly hard to get people to do it you’ve already trained your team on it it has all of your information and data sitting in that system it’s just really hard to rip something out when it’s there which is why things like salesforce are gazillion dollar companies even though people complain about it all the time it’s that is your system of record for that thing so i think that the vendor won’t give you what let’s call this elaine company elaine elaine bundle company they’re not going to give a lane bundle company a referral fee i think for correct and the whole way this makes money i mean i guess there’s two way a subscription or a referral fee their sales force is going to say uh no these customers already use us we’re not going to like give you any more discount or we’re not going to give you a let me clarify so so you’re not saying it’s not class pass it’s not saying pay me x and then you get discounts across all your 34 apps what you’re saying is make a beginner version of the core eight things as a as an actual bundled thing not the single player apps our single function apps and do the 80 20 and just do the core functionality don’t get the the long tail of like edge case features that you need and offer it to somebody out of the box as like hey here’s the simple thing so you don’t need to sign up for 12 different services yes and when you look at the volume of companies at the early stage versus the later stage which need enterprise functionality the volume is like 1000x at the early stages so in terms of your ability to capture those people and capture them early where they are going to be sticky and they’re going to grow with you to a point will people outgrow this maybe but the number of people that ever get to that scale are so few and far between that i just don’t think it matters right and i think people have to acquire those customers early on we work with um a lot of people who advertise with the hustle and all their whole like we’re uh one of them is called just works you know what just listen yeah this works is basically a i’m gonna kind of dumb it down really dumb but it’s basically a payroll software but because of the way that they operate you have to sign up with them pretty much from the beginning like right when you start a company and i have a feeling that they’re struggling because they can’t get it’s really hard to get a lot of those people to sign up for you so challenging in the same way in the same way it’s hard for signal fire in order to find companies who are just starting it’s really really hard for these folks well so here’s my hack and i learned this so back in the days when i was first getting into startups i got really into growth hacking back in like 2013 when it was a really hot topic and i started my own side hustle consulting gig working with seed and series a founders on growth and i learned really quickly that if i partnered with the vcs they would just send me unlimited number of customers i never did any business development because they’re constantly investing in net new seed and series 8 companies and they’re trying to be helpful and their companies 100 of companies are needing help with growth and so they’re like okay who should we send them to send them to elaine so the hack here is you start with all the vcs so they’re getting i get asked a dozen times a week what software should i buy for this what tool should i use for that so that’s my hack to get started then you start to get some viral word of mouth going among founders because founders have their groups online they have their communities they talk they’re saying oh dude you have to get this like that’s the best software you can use for all your stuff so that’s how i would go to market even then like where you were growth hacker growth comes right after growth comes after you have a team you have a product you have something right you start to talk about growth whereas yeah even when you talk to a vc you’ve already done something you usually are not like there is precede where it’s like just you know two people not an idea but um it is still hard to catch you before you’ve even started with slack and g suite and uh you know three of those eight eight modules you know my whole thing around so the one thing everyone will have is either g suite or office 365 that i’m not trying to build right that you do you do g suite and this hooks into that i’m not trying to kind of take that down you know slack yes probably that one is a little bit easier in my opinion to rip out but if i look at our seed portfolio and when they graduate to series a that is the time when they’re starting to think about getting a crm helper marketing automation system and that’s i think there’s probably three different pieces of software that are the right insertion points after you get g suite the next thing is probably payroll and if you look gusto is kind of like the only thing most people use today it’s been around for a long time it does find i don’t think it’s a particularly super super complex piece of software so can you go and say cool if you’re under 40 employees we offer the exact same functionality as gusto but we also offer xyz and you know zillion workshops you have a bunch of ideas let’s hop to another idea um that you have give us like give us your top three ideas and we’ll pick which one to go into so just give us the one liner someone should start this i i i that’s cool if you think that’s going to be huge i think it won’t be huge i think it’d be mild but i think one of us could be wrong but either way it’s a win yes agreed i think it could be huge but even if it’s not it will definitely not be a it will not be a bad outcome right oh man where to start okay uh one that i really like that i also really want somebody to build is an adulting vault is this one yeah what does that mean what’s an adulting fault so by the time you’re out of college you have a bunch of things in your life that are like okay i have a credit card i need to get my first apartment so i’m paying rent i have to think about insurance i need to have all my monthly bills paid in subscriptions i now have internet and utilities and all these things are disparate and there is no one place where kind of all of my adulting responsibilities live and if i compare this to a product that’s existed in the past mint.com which i think launched back in 2007 was kind of the first thing that said hey your financial life and financial picture is sitting all over the place can i aggregate it in a really simple app to give you that one-stop shop and i want to do that for literally everything in your adulting world and as you get older and as you have kids and a mortgage and a car and all these other things you have so many different places where you know your insurance policies live your bills live your financial products live your investing accounts live and nothing has aggregated that and i also want it to suggest things that i’m missing so it’s like hey you might want to think about life insurance here are the best life insurance policies for somebody that fits your description so you monetize via referral and you know via affiliate but it also can let you know of like hey this is coming up for renewal make sure you pay this bill and you can auto pay and stuff like that can i niche this down even a little bit more so sure do you own a house i own a condo um so i just bought uh i know sean did i just bought my home recently it’s the first time i’ve done it i didn’t know anything about anything i probably still don’t but they gave me so basically what you do is for anyone who doesn’t own a home uh right before you agree to buy it and then someone you hire an inspector in texas i paid this guy only five hundred dollars was pretty crazy he comes through and he pokes his head in the closets and he goes all right all the electrical things work this thing it looks like there’s a little mold here yada yada yada and i got a booklet that was pretty thick about a 50 page to 100 page booklet and i’m like okay that’s kind of cool but even two months after they did this thing i’m like wait what is this light switch this light switch doesn’t turn anything on what is this doing and in the booklet this guy has actually already addressed this um but i don’t want to search this like this like actually printed out booklet um i almost switched so you’re almost talking like a life manual i would niche that down even further i’m like someone should just create a house manual so i can just do ctrl f uh bedroom back corner light switch what is that where’s that what’s that doing um i almost wish i had this just for a home and then you could layer [ ] on top of that like uh what’s the best home insurance which i was trying to figure out what’s about you know similar to that so i i’m with you uh elaine on the adulting thing i have two ways to contribute to this idea one is how do you get customers i’m a big fan of quizzes quizzes i think are extremely overlooked um i remember uh michael burch who was my investor my previous company and he was the original founder of bebo and he he basically had sold he created a social network he sold it to tickle which was a quiz company and tickle was like a 100 million dollar company that was just doing quizzes like what breed of dog are you what um you know what city would you be if you were a city that sort of thing like fun little quizzes and then they had some quizzes that were career quizzes that would help you get jobs and that’s like where they made some money and then when he left there he was like all right i’m gonna start another social network and he’s like i know how i’m gonna seed it i’m gonna make a quiz and he created the best friends quiz which was how well do you know me and um and so i would create a quiz i would answer a bunch of questions about me then i would send it to my friends say take this quiz see how well you know me and then the results were posted on my profile and he got a million members in nine days uh off this quiz and their profiles were filled because they filled in a 10 20 question in a questionnaire about themselves so now they had a full profile and they had their friends um it was crazy and so i’ve started to pay attention to quizzes i think you could create the adulting quiz and go viral like kind of now of like you know what percent adult are you because i think most people in our generation kind of admit and acknowledge and laugh at the fact that we’re like totally not adults even though our age technically classifies us as one and um and so i think you could i think you use a quiz to get a bunch of people to just see like you know do you have life insurance like yes no i don’t [ ] know you know like what is life insurance right like exactly one is life insurance exactly and at the end of it you basically give them this little infographic that’s like nine squares and the nine squares are like cool you have like enough savings for like three months of life if you needed it uh good you’ve checked that box of adulting um you don’t have like health insurance you know you are an ex here click here and we can help you figure out like why you need this how much it costs how you should do it depending on who you are and so i think you could kind of give people a report card and then let them click in to like solve that problem for themselves and give them the you know educational referrals that they need from there i love that idea also you hit on an interesting stat that i heard before which was validated by a couple companies i was looking at that the longer the quiz the more likely people will actually continue to answer convert 100 that’s crazy when people so for the hustle we get like 10 000 sign a day and we would ask them like question after they sign up and we would do like i would put two questions in and then inevitably everyone the company was like oh that’s already too many i’m like no no no put five and we put five and then we put ten and eventually we had like 30 questions and it had like a 98 percent completion rate um the the more quite and not only that they actually interact with you more after they’ve answered this which is really counter-intuitive and a lot of like particularly startup people are like oh you know i don’t want to be too aggressive yadda yadda i’m like no well here’s how it works i’ve done this many times tested the same thing many times because uh anyways i’ll skip the story part but there’s an entertaining also bebo story from michael birch where he was like he put a red but i’m not skipping the story part i’m telling the story he put a red button on the site for one out of every 1 000 uh visitors so imagine going to facebook and just seeing a shiny red button in the corner for the first time and you click it and then the whole screen just went clear and it was like here’s a cat click the cat and you click the cat it’s like this is a bowl of pasta don’t click the bowl of pasta you clicked it and and then it’s like the cat’s dead we told you not to click the bowl of pasta all right click the cap bring it back to life it was just a stupid thing that he had a hundred steps and what he learned what just doing he just did this for fun just to mess around and what he learned was like the first the first button you know people will usually click out of curiosity but you’ll lose like 30 of people who just don’t click it because they’re busy they just go do something else and then the second one you lose another maybe like 20-ish percent and then after that the people who get to step three like 98 of them will go all the way to the end because they want to know how this ends um and we did the same thing for a charity project where we were raising money it was the exact same step 30 lost on the first fund 20 loss of the second one and then 98 finish the rest and uh so i’ve seen this several times and everybody in your team will tell you dude this is too long we shouldn’t ask too many things wrong it works uh get as much as you can because once they get to step three question three they’re gonna finish no matter how many questions are in the thing one nuance here that is a hundred percent accurate for consumer and 100 inaccurate for b2b for anything enterprise shorter is better but i think on the consumer side i think there’s two psychological things at play one people love talking about themselves and that’s why we do all the quizzes but the second which i think sam was hitting on is if i’ve answered 30 questions i think what i’m going to get after that is going to be super valuable right because you know me now so whatever it’s going to be personalized can be valuable and it totally works what do you do at signalfire i saw your title is it just venture partner uh i’m a partner so i invest but i also spend about 30 percent of my time leading all the growth and go to market programs for the portfolio so it’s kind of just me getting to exercise that muscle still sometimes i parachute in parachute out help them with some of the growth needs i have an entire network of freelancers contractors agencies for everything like hey i need a seo content writer or i need a tick tock video producer and so i can match make on stuff like that and we run a bunch of events and teach people how to do the stuff and are there like two or three partners and you’re one of them basically just means you’re you’re one of the owners you’re you’re you’re one of the shot callers i have investment power we’ll put it that way yes i think there are five partners at signal fire absolutely let’s do ideas sam no nobody cares about vc uh all right uh well no wait wait are you going somewhere with this compliment which is you’re like i’m looking through these ideas you’re like you’re very amazing uh every one of these ideas is interesting i want to go through all of them um and they’ll have me back on we’ll do all of them it’ll be great let’s do one right now let’s do snoo for adults what’s this one i know what the snow is because i have a baby sam does sam do you know what the snow is no okay i’ll explain this new so there’s a company called the happiest baby and it produces a smart bassinet and what it does is rocks the baby it has noise it can sense all this stuff and people swear by this shawn did you guys use this yeah like my kid is in it right now while i do the podcast so uh you know the only reason i can do the podcast because the snoo is basically babysitting my kid so like you see this app and it’ll basically say like oh banks is calm it’s like he’s sleeping in there he’s not crying if he cries it’ll go to level two it’ll rock more to try to get him to like chill out so it saves you the step of going in and like soothing the baby make noise and rock like a human uh and it’s safe because there’s a big like problem with something called sids but is it is this new uh a category or a brand it’s a brand it’s a brand it’s a brand and these things are incredibly expensive and you can only use them for a really short window of time and so there’s a whole secondary rental market and resale market for these things but parents swear by this so okay let’s apply this to the broad population of human adults we suck at sleeping and nobody has ever rethought sleeping from a first principle’s perspective i mean first off it kind of makes no sense that we sleep with another human in the bed quite frankly like i roll over i grind my teeth you know i we have a dog in our bed too that kind of makes no sense second i want something that is temperature controlled that rocks me and like knows my my behavior that removes all light that removes my phone so i can’t go and scroll on buzzfeed stupid quizzes at two in the morning why has nobody rebuilt the bed for humans and i think we have enough sensors we have enough smart connected home products today to do this so i would have been i would buy this i would have been skeptical about this but for three reasons a uh i’ve used the snoo and i’m like oh i wish i had this like this is great um b um you’ve seen a rise in these like expensive at-home equipment whether it’s peloton mirror tonal like there’s all these things that cost like eight sleep bed you know like things that cost thousands of dollars that you buy to improve one small aspect of your life whereas if you actually like if you told me there was genuinely a sleep pod that i could go into that would improve my sleep by even like 20 what’s that really worth to me right like of course this is kind of a first world problem high class you know high class like product okay whatever yeah it is but um i think that’s worth at least five to ten grand right because that’s it’s eight hours a night every single night getting better which is making me healthier happier you know like more productive the next day so i actually now believe that a product like this could exist um i never used one of those google nap nap pods but like i feel like that’s what those are trying to be i think i would totally buy it you’re spot on it’s a first world problem but for all the people that are buying 3 000 bikes or like the 5 000 treadmill from peloton right that’s the demographic here so i want somebody to build it that’s what peloton should do honestly like because they’re not going to find another bike like even the treadmill they’re not going to find another treadmill there’s only so many of these like places to expand they should go straight to the bed and uh and create the bed with a sleep subscription that’s like the calm sleep stories uh layered on top of this well make a wellness brand out of it health is only one piece sleep is a huge component of wellness i totally agree with that can you talk a little bit about subscription running shoes because that i mean that interests me and i have a few opinions but wha what is this so i’m a huge runner i think you are too sam and i also have an apple watch most people who are runners have some kind of connected device that’s tracking all your steps and things like that and you’re supposed to change your running shoes every 300 to 500 miles i have no freaking clue when my shoes have had 300 to 500 miles i can’t even tell you when i ordered them also for runners you have a brand and a style of shoe that you typically stick with i don’t know any people my running friends who mix and match so i’m a brooks runner i use brooks adrenaline eight and a half narrow every time i want brooks to create a subscription for me it hooks into my watch and my smart my smart device it says hey we’re just gonna auto order you new shoes every time you hit like you can pick 400 you know 400 miles or x number of months and it gives me a discount because it knows i’m gonna be a customer for my ltv just went up 100x because it knows i’m gonna continually order so a they’re going to get me to order more frequently i’m going to be a super happy customer because i just get it in the mail they can start partnering with other companies and doing these bundled subscription products but to me this is such an obvious product that no brand’s done you could also partner with some celebrities and make it really cool i don’t know why this doesn’t matter let me give you the low-tech version of this um here’s how you do this without the apple watch yeah you know like toothbrushes have the little strip the the little blue strip that’s like this is this toothbrush has like you know been used way too much and like i like baby diapers have this too the blue little streak which tells you they peed um this is what you need on the bottom of the shoe this bottom of the shoe needs to change colors as it gets worn out and then so so you basically have a visual indicator that you have out worn this shoe it’s time to order another and [ ] it put the promo code for your next order under the under the thing so when it wears away it’s like it’s time to reorder here’s your code get your next shoe here’s the problem with that though i know when my shoes are worn out my friends know when their shoes are worn out it’s the fact that i have to go and be proactive and reorder that’s the sticking point i just want it to happen i mean it’s like the whole amazon button that they were trying to launch it’s a qr code you just hold your phone up to the shoe bottom and then it orders you the next suit that i like anything to remove friction i i want all friction removed i would love to have a package show up how would this make money i mean because like if you’re when i when i hear this i’m like yeah okay cool sounds great but as an outsider i’m like i don’t think i can make money doing this like brooke why aren’t you doing this this is for brooks this is not i don’t think this is an introduction i was excited about this i thought you had an angle here here’s an idea you can obviously bring on doing this right like correct you can start i mean if you look starting at shoe brand i think is like on the upper five percentile of horrible ideas i get targeted on social media by and maybe i must have clicked on one at some point but every variation of your all birds type shoes so like semi-athletic i mean i’ve probably seen 50 so it can’t be that hard to make the only way i think you do this as an independent company is you provide the picks and shovels infrastructure for every brand to do it so you go and sell to the brooks to the nikes of the adidas to the reebok i think that’s doable right uh okay let’s see let’s pick one more idea that you have on here what’s the best one that you sent in that we haven’t talked about yet that you’re most excited about this will be another fun fun one that’s kind of on the consumery side so i have this concept called therapunch and i kind of need to give the backstory here because this is actually funny and involves running so there’s a nice tie-in so like a year and a half ago right before the pandemic i was running in the mission in san francisco at like six in the morning and it was an area where there was no people i’m just kind of going and i have a green light i’m running through the middle of the street in the intersection and this dude in a super beat up janky car comes and turns right and like cuts me off and comes really close to hitting me and i kind of jump away and gave him the like what are you doing dude look and he rolls down his window and starts screaming out and this is i don’t know if you want to believe this but he’s like get out of the street you stupid [ ] [ ] and i was like holy [ ] and i’m not an aggressive person normally but i had had a rough week and i was kind of on edge anyways and normally i just turned my head and run away but i had to take every ounce of restraint not to go and just kick the back of his car i was so pissed i just wanted to punch something and as i finally got smart and ran away i was thinking to myself there’s something going on here which made me want to go and punch his car or kick his car and i was like you know everyone always tells you to go meditate go download calm go sit in a quiet room like great that’s fine i need to punch something and so i wanted to go punch something and then meditate so the concept here and i think now is an interesting time because there’s so much vacant real estate is you buy up and rage there’s so much rage rage so much don’t forget that part so much race high demand well there’s also an established uh concept of these rage rooms smash rooms break rooms the problem with these are it’s very dangerous you have to put on a suit you can hurt yourself there’s a lot of liability and also there’s a lot of cleanup so this is the exact like low-tech version it’s a padded room with padded walls punching bags things to like rip and pop imagine like stuffed animals you could tear the heads off and you go and you connect to a spotify rage playlist and there’s a bunch you can choose from you go in for 15 minutes into one of these things and if you guys have ever done boxing 15 minutes you’ll be exhausted so you just get it all out for 15 minutes and then they take you to the zen zone for 30 minutes where they have guided meditations and they have you know spa water and you can sit and meditate so you go and get it out then you center yourself and then you go back to work sam you’re our resident uh rager so uh how do you feel about this no that would make me way too mad like i’d be like [ ] time to go to the [ ] thing i just want to smash this [ ] right now like i smash stuff i i i like like i do break what’s the last thing you’ve thrown or broken out of rage well cell phone i mean i mean everyone does that do i have my phone here everyone does not do that i don’t know i haven’t done that my screen is is currently shattered i mean i just get angry you know and i do that as well but i i like and a lot of people tell you not to do that i think it’s great like you’re just like cathartic yeah you’re just breaking a little thing that you could replace with some money and like you’re not hurting anyone i’ll give you a quick spin on this idea because i also think that the the timeliness like i don’t want to book and reserve the room by then it’s all dissipated and now it’s a task i don’t want to get it sorry i’m with sam you need the instantaneous release um so so the other thing i found interesting is there’s a whole bunch of these like alternative um alternative therapy things that i find interesting cryotherapy where you go in and your your neck is out of it but your body is in this like kind of like i don’t even know how low the temperature goes but it’s like this very cold like kind of like liquid nitrogen gas that’s put against your body supposed to be great for recovery there’s the float franchise which is all about floating in this like salt water bath where you’re weightless and you’re in this light you know deprived pod and like an hour goes by and you like hallucinate or whatever the hell else i don’t know joe rogan talks about it i have a friend who gave me a pass to go do this once and so they’re awesome never have you heard of it yeah yeah there’s one in the mission actually i walk by it all the time i’ve been to that one many times and so there’s and then there’s basically like there’s a set of these kind of like alternative things and i wonder if you could create the equivalent of a gym membership that basically says okay instead of coming to this like a gym membership is a giant box that has all the heavy equipment you’re not going to buy for yourself but you can come here and you can use it and i wonder if you could do the same if you bundled these together where you bundle the different therapies together sauna steam cryotherapy float tank whatever and it’s a gym with no weights and it’s a gym basically for the brain to recover um and to to relax and uh and you you put a whole bunch of these things together and maybe you create a different type of uh wellness like category would you ever do them back to back just thinking about what those all are would you ever go i like what about what about a class pass for that kind of stuff because they’re pretty niche today and they’re expensive and it’s also not like a gym membership where class pass had so many problems i could go into that but i was one of the earliest users and they lost so much money on me but ultimately they were hoping the vendors were hoping that you’d become a subscriber but for these things how often are you going to go to a float tank or cryo spa or whatever so if it’s more of a one-off thing and you want to try a bunch of stuff they could actually end up making money on that i actually started going quite regularly i think the difference between san francisco and where i live now so i lived in san francisco for eight years right around the mission is it’s like kind of a pain to get from a to b you know because you have to take an uber or a bus a bike or a bike um although i hated biking in san francisco um now that i live in austin i i’ll just like it’s no big deal to like leave work at three and then go do the thing and come back by and be back by five and get some more stuff done um and i do these uh cryotherapy which i don’t think does anything but it’s fun i do the float tank i love all that stuff so i do think that could actually people would do that more regularly than you think yeah if there’s food i think people go somewhat regularly or like smoothies or something i feel like that might work on a side note and i’ve looked into the economics of these things before very briefly but maybe we should do kind of a deep dive uh these cryotherapy like uh places and float tanks places uh these guys do actually pretty well like if you just kind of wanted to if you wanted to buy essentially a high paying job for yourself uh you can you can get a location you basically buy one of these machines for three thousand dollars five thousand dollars and no no no no then they print money i think i looked at the cryo the cryo stuff and also uh the second one is um uh these dexa scan uh places um i love that they it’s such it’s like literally it’s one employee and uh online booking contactless payments all that stuff so you basically have one person who’s usually it’s theirs it’s their place uh sometimes they have kind of a junior person who watches it while they while they leave for half the day but it’s very low labor and it’s just the same machine that pays itself off in the first x uses um and x can be you know might take one month might take three months if i take six months max but uh these businesses are pretty simple and uh can do quite well have you heard of that business called dexa fit the one they’re like guys in a van yeah they come to you yeah and you do the decisions they work in front of like company buildings usually and they’re like hey come see you know how fat you are and then you know you pay 80 bucks and you go get scanned or 50 bucks and you go get it they’re the best i go when i look every three months i would go every three months safe i would buy like a 10 turn pass or something like that it was maybe 50 bucks a turn and you see progress they are so awesome it’s uh i would imagine it’s a pretty expensive machine maybe 100 grand per van um they’re really amazing i would love to see what the revenue is and eventually they bought a they had a place right across the street from the uh twitch studio or you know the studio show that we would go to and it was like a crappy lobby with just like a cat scan and you would sit down in there and then you’re out a few minutes i love that business i would i’m curious as to how they do elaine you ever seen this i think i know what you’re talking about i’ve never done it i’m curious with it is it telling you information you don’t know when you do it the first time i get that that’s a novelty but if you’re doing it every three months do you not know how your body’s been behaving over those three months it tells your body fat percentage right but like don’t you know if it like went up this month well that’s that you want to measure the progress right so like for example uh i’m working out right now my actual weight stays the same because i’m adding muscle i’m losing fat and so i’m like [ ] this doesn’t i i want my score to show the progress i can see it in the mirror and my trainer’s like dude do you need this you just look in the mirror it’s fine and i’m like yeah that’s true but i like the science of it too i’m like it’s 40 i think it’s 45 bucks to go get dexa scam and uh so me and my brother-in-law we kind of made a habit out of it and like we’re just like okay we’re gonna go get scanned every three months that’s how we measure our progress and like you know great we’re down three percent body fat like let’s do it again that we’re referring to it’s called body spec so the word body and then s-p-e-c body spec and sam just so you know it looks like the price of these range from between sixteen thousand and forty-five thousand dollars so that yeah that’s not that bad and they like they’re in like like a mercedes sprinter and they have like the car wrap so maybe a hundred grand total um i think this is cool i love this company um i don’t know anything about their numbers but i think it sounds so neat it’s so simple the distribution for this is also good because they can partner with gyms so they partner with crossfits they partner with uh you know trainers and they’re basically like hey you send it to client you know you get 20 bucks out of the 50 buck like like scan um you know for the for every first time customer that you send in and so they have like kind of a built-in referral system that makes a lot of sense i’m actually shocked to lend that you’re not like bullish on this because when i go it sounds like shawn and i are the same when i it’s so rewarding like i’m pretty much working my ass off literally just to go from like 20 body fat to like 19.5 percent like i just think about that number constantly i think i’m just not the target demographic at all because i’ve always been extremely into fitness but i’m intrinsically motivated so i don’t know you know what i was gonna say though a partnership opportunity for them is future fit because they’re already charging people 200 a month for literally a digital subscription to a virtual trainer and you can bundle in a lot of these other services and things like that that to me feels like the demographic because the people i know that do futurefit are the people that care about this stuff they want to see incremental progress they want to know their score constantly and they’ll pay i used futurefit so there you go good job everyone keeps trying to get me to use it i’m like i don’t need this like i i just i’m very very competitive with myself i have a peloton which you can see in the back and i’ve always been a huge runner and my mom actually won this like four years ago and at the beginning i didn’t use it a lot and now i’ve been doing a lot more cycling during the pandemic because i hate running with a mask and i’ve gotten so much better at the peloton but i’m always trying to beat my own score i don’t need to know i remove the leaderboard and stuff i don’t care about that but it’s it’s my own my own score one of your portfolio companies is called tempo sean have you tried the tempo it’s awesome it is so awesome it is so awesome have you not tried this i haven’t tried it you showed me the videos if you had it in your garage you still have it i bought one okay so elite they sponsored us so i got paid money i just used their machine and then i moved and they freaking took it back i’m so mad at them like yeah just leave it let me have it they took it back after i used it and i was like on the number one i was at the time very very in uh fit into that hit hit stuff and i was in shape um and i was like number one in the category and i kept working my butt off to do it and i just bought one the other day i think i paid eighteen hundred dollars it took eight weeks to get delivered um and this for the listeners it’s called tempo fitness or something just google tempo fit and it’s basically like peloton but for weightlifting um and for high intensity interval training it is so awesome so addicting i like in building my workout routine strictly around tempo it has it’s like a mirror like the the mirror thing so it’s freestanding it’s not like tonal where you have to wall mount it and it has i think 185 or close to 200 pounds of weights and it’s got these amazing instructors that do all kinds of these hit workouts we had one of the original beta units in our office and i was pretty much the only one that used it but i use it all the time i don’t have room for it now but uh sean when our office reopens you’ll have to come in and try it i’d love to that’s it sounds pretty good i remember sam uh the video looked cool i would say that the actual design of the box i don’t know if you had like kind of an earlier version of what it wasn’t as slick as like what a peloton or mirror and whatnot looks like it’s not entirely slick but i actually think they’re making an error but but it has a sensor on it so it like tr it could tell if you’re lifting the weights and it counts it for you so it’s kind of hard to cheat that’s great but but it’s like a cabinet where they store the weights and i think a lot of people actually already have the weight so i wish they would sell it to me just so i don’t have to use their weights well it uses computer vision to not only count the reps but it checks your form so let’s say you’re doing a curl and you’re only going 80 up it’ll call that out if you’re doing a lunge and your knee is going over your ankle and so part of the weight counting rev involves their own weights but all the other stuff it’s essentially creating a like a dot matrix of your body so it’s anonymized but it can tell exactly what your form is so it’s like a real time personal trainer there plus this celebrity trainer who’s doing the class for you it’s pretty freaking cool you gotta get one sean they’re good it’s it’s it’s worth it but there is another downside it’s 50 a month for a subscription right they all are though i think that’s crazy that’s so expensive and it’s so expensive i cannot believe that i think it’s way too expensive cheaper than a gym membership yeah i know you do that logic yada yada yo you got my money i mean i’m paying for it but i still think it’s for the price of a cup of coffee a day you could transform your body yeah by the way it’s ten bucks a month so but think okay think about the value you get from that versus essentially in my opinion future fit is paying for accountability so you’re paying 200 a month for a person on the other end to like sort of care about you i get it but like i know what this costs them i know like i i already bought this two thousand dollar machine and like give me a years free at least um they don’t make a ton of money on the hardware part they’re making money on the subscription well look i’d stop using logic on me and it just let me be angry that currency is not accepted here we’re like a vending machine you keep putting it on and you keep getting it back out as long as you keep paying for it i’m okay i’m okay with removing logic no i’m paying for it another great one that you guys should look at is our gotta you guys know right now we’re too famous now we only use free [ ] that people give us we don’t pay for anything anymore you know how great works the more popular and rich you get the less you play for anything so i at this point i don’t pay for anything i actually stopped giving out my address because i was getting so much free [ ] and i was like wait maybe i shouldn’t give up my home address to these like strangers on twitter so now i’m like i’m like no thank you i’m gonna get one of those celebrity youtuber p.o boxes and be like you know just send it to my manager and send it to my partner i always say like hey i would love to send you x y and z and you say yeah i i just gave him ben’s address like hey will you share right right i just give him ben’s address now i’m like give ben all the free [ ] and they’re like wait you’re not in brooklyn i’m like yeah yeah i have a house in brooklyn [Laughter] you can send me all the stuff you don’t want to especially if anybody wants like women to test stuff send it to me i’ll take it i’m sure you’re you’ve got you i’ve seen your portfolio companies they’re badass you probably have so much great stuff yeah no follow me at zelby.stubstack.com z-e-l-b-y it’s called three things every sunday i publish three business ideas and they’re i would say somewhat well researched and thought through but uh they’re all fun and they cover pretty much every topic you can imagine and then also if you like unsexy businesses i do a podcast called unsexy and i just talk to founders building in super random niches like chemical marketplaces or companies that are growing the growth media for lab grown meat just super random stuff but i find it fascinating like our sister from another mother honestly when i heard the podcast really early days i was like oh my god these are my people you’re great thank you for coming on um all right see everyone i could be what i want travel never looking back [Music] uh