Syed Balkhi, founder of Awesome Motive and WPBeginner, tells his story of bootstrapping a portfolio of WordPress software companies to over $100M in revenue — starting at age 12 as a Pakistani immigrant who couldn’t speak English. He explains his buy-over-build philosophy, how he uses gas stations and real estate to generate cash flow, and what he learned from studying Buffett, Munger, and Constellation Software’s Mark Leonard about compounding and capital allocation.
Speakers: Shaan Puri (host), Sam Parr (host), Syed Balkhi (guest, founder of Awesome Motive / WPBeginner)
Introduction: The Camp MFM Hot Seat [00:00:00]
Sam: What up, dude. This is a long time in the making episode. I think we’ve been talking about you for like two years. I think you told us — you were like, “Hey guys, don’t put me on blast like this.” We were like, “You gotta come on the show.” You’re like, “Nah, you’re just gonna ask me how much money’s in my pocket right now, and I don’t know if I want to do that.” But somehow, some way, we convinced you to come on. Syed Balkhi, you’re here. First — why did you change your mind? How did you decide to come on?
Syed: You know, I was talking with Sam over Twitter DM, and that’s how it happened.
Sam: Well, what I told you — a lot of people think that Shaan and I are really aggressive about questions, but what they don’t realize is we’ll ask an aggressive question, but if you say “I don’t want to talk about that,” we just go, “All right, cool, we’ll move on.” We’re not digging that hard. So hopefully that changed your opinion.
Syed: That did. That did.
Sam: So Syed, you’re kind of an amazing guy. Let me just set the table here for people. Let me just tease everybody with the appetizer. I think you’ve done something that I don’t even know five other people on Earth have done — which is you’ve basically bootstrapped a unicorn. You’ve bootstrapped a billion-dollar company. You’ve done it by 32 years old. And it’s not like you invented the next big thing. You’re not a genius who created Ethereum on the blockchain. You just did a very specific set of prudent, smart actions and it added up in an amazing way.
Sam: Also, I didn’t know anything about you. Sam’s known you for a little while — he brought you up on the pod a while back. He goes, “I know this guy, or I met this guy, he’s really interesting, he does this WordPress stuff. Have you seen him?” And I was like, “No.” We went to your personal website — I don’t know if you ever got this clip — but way back in the day we were talking about you, we didn’t know too much.
Sam: Then we did Camp MFM — my basketball fantasy camp, where we invited like 25 other founders and had an NBA guy come treat us like we were pros for the weekend. When we were there, there were so many people to get to know. I didn’t really get to know everybody. But then Mr. Beast did something amazing. One night we were all in the kitchen, everyone was hungry after basketball, and Mr. Beast just set a chair in the middle of the room and said, “I don’t know who you guys are — I’ve just been playing basketball all day and now I’m curious. Who are you all?” He’d have someone sit in the chair and he’d just interrogate that person: “All right, what do you do? Who are you? How does that work? Is that big? What’s your dream? Okay, cool.” Then go to the next person.
Sam: I think you were maybe the third or fourth person in the hot seat. And I was like, “Oh, this is great — I actually don’t know too much of Syed’s story.” And then you just blew us away. Mr. Beast was interrogating you and I thought it was just the perfect interview. If we’d recorded that podcast I would have been happy. So we’re just gonna try to recreate that moment right now.
Shaan: Inside that room, you were one of the quieter, more humble people there — and probably the most impressive in terms of traditional business accomplishments. It was very fascinating.
Shaan: I basically heard about you through my friend Neville Medhora. What I know about you is that you had this blog called WPBeginner, which wrote a ton of articles — some really simple, like “how do I set up a WordPress site” — and it still gets a ton of traffic. Then, if I remember correctly — and this is just from an outside perspective — you basically started buying different WordPress plugins that you could see were popular on your blog. Like, “Here are the five best plugins for capturing emails on your WordPress site.” And if you put your cursor over the links on WPBeginner, you’ll see which are affiliate links. I’m guessing that of the top five form plugins for WordPress, you own like three of the top five, and through that you’ve built this into a business.
Shaan: By the way, I’ve never been told this — I’m just guessing. I assumed this makes high tens of millions of dollars in revenue.
Syed: No, no, Sam — not tens of millions. Nine figures of revenue. Over $100 million of revenue.
Shaan: Oh, I did not know that. Wow.
Sam: So just to paint the picture — you have WPBeginner, and we’ll talk about how you got there, but that’s the content site providing free help to people trying to make sites in the WordPress ecosystem. That’s the mainstay.
Sam: I’ll draw an analogy here. We’ve had Andrew Wilkinson on the pod — probably one of our most popular guests. You have a business a lot like his. He’s got a portfolio of companies. He had MetaLab, which was his Core Business Cash Cow that allowed him to buy the others. You had your WordPress content site as your core engine.
Sam: But I think you’ve actually done something a little better — no knock on Andrew. You’re more in one ecosystem. You’re like, “I’m going to dominate this WordPress ecosystem.” And WordPress powers something like 30 or 40% of all websites, so it’s a huge chunk of the internet. All your stuff fits together — one customer trying to make a successful website and grow, and you’ve got the content that helps them and the tools that help them. You’ve built this portfolio that now does nine figures in revenue, probably worth a billion dollars, you own the whole thing yourself with no outside investors, and you’re only 32 years old. Does that description do it justice, Sam?
Sam: Yeah. Then there’s all his side hobby stuff — I read his annual report and he’s like, “I bought a gas station… I bought eight or ten gas stations.” So that’s a whole other conversation.
Origin Story: From Pakistan to Proxy Sites [00:09:00]
Sam: Let’s do a quick thing on the origin story. You told me once on the phone — I think you were doing consulting, something like an agency, you were helping people make websites, building CRMs for them. And then WordPress came out and you were like, “Oh, this is way better, they should be using WordPress.” You started helping people, it became your core service. And then you were like, “Okay, I’m just gonna help people make WordPress sites for their business.” Is that right?
Syed: Pretty much. So remember, the very first websites I built were online proxies, because I wanted to play games in school. I was making ad revenue on proxies and some arcade turnkey sites, and I was helping small local businesses set up their websites. I tried making my own CMS with PHP — by the way, I can code. I’m not the best at it. I would say now I probably suck at it.
Sam: And what age was this?
Syed: 13, 14.
Sam: So you’re 13, 14, doing this. Are you at the dinner table at night being like, “My clients are a pain in the ass right now, Mom”? What are you saying at home? And how are these people finding you — are they coming to your middle school and you’re handing out flyers? What’s going on?
Syed: No, no. So we moved from Pakistan to the US when I was 12. My dad had a mechanical engineering degree, but it did not validate when he came to the US, so he was working 16 hours a day as a gas station clerk — just swiping things, 16 hours a day, Monday to Friday. On the weekend he had his third job. So I didn’t really see my dad. My mom was busy because there’s three of us and the fourth one on the way. So there weren’t many dinner conversations happening.
Syed: I wanted to figure out a way to have some chunk of change in my pocket so I could buy Mountain Dew, Kit Kat, and Snickers and all that stuff you buy in high school.
Sam: Dude, your dad was at the gas station — you had the hookup! You just needed to ask.
Syed: My dad would never do that, by the way.
Sam: You went to high school at age 12 also, right?
Syed: Yeah. I started so — I moved here having just finished seventh grade in Pakistan, and I came in March. The school system was like, “Well, we can put you in eighth grade — worst case you’ll repeat, but your education system in Pakistan is probably far enough ahead.” So they put me in high school. I’m 12 in high school, the youngest person in school. I did not speak English that well — probably very little English. I knew how to read English because we were taught the alphabet and such, but my communication skills were not there. So yeah, that was a pretty challenging time. I spent most of the time in the library during lunch because I couldn’t talk to humans. I would just play on the computer. Those game sites were blocked, so I was like, “How do you unblock this?” And that drove me down the rabbit hole of proxy sites.
Sam: How were you getting clients? Were they coming through forums?
Syed: Yeah, through these forums online — DN Forum, Digital Point, NamePros, a bunch of these OG communities where you could get business. My cousin got me into one of those.
Sam: They don’t know you’re 13. You’re just a guy in a forum.
Syed: Yeah, well — we had a family friend who needed a website. They knew how old I was, they were like, “Oh, you can do it,” and they’d pay me $300 to build their website. I’m like, “Okay, sounds good.” That’s how that funnel started.
Sam: So you do websites, you’re trying to make your own CMS, you discover WordPress, you’re like, “Oh, this is way better.” What becomes the aha moment, and when do you create the blog?
Syed: So I’d discovered WordPress, moved my clients over, I had affiliate sites, I was doing affiliate promos. I had directories. I wanted to get more traffic, so I created these Myspace profiles — fake profiles — and got hundreds of thousands of followers. I would send DMs, which were called bulletins on MySpace, just wanting more traffic. I went down the rabbit hole of SEO, which brought me deeper into WordPress. And because WordPress is dynamic content, I added blogs to the directories and started using it for clients.
Syed: When I wanted to get rid of the consulting business, I asked other agency owners how they handled documentation. They said, “We just had these PDFs we give to clients.” I’m like, “But WordPress updates all the time — how do you keep those PDFs updated?” They said, “Oh, we update the PDF.” I’m like, “That’s dumb. You should use WordPress to update documentation.” So WPBeginner started that way. It was the unofficial documentation for WordPress. WordPress had documentation, but it was written for developers by developers. Nothing was for business owners.
Shaan: And what year was this?
Syed: 2009.
Shaan: Good point — that’s now six years after WordPress started, and you’re making the beginner site, and there really wasn’t a great one. There’s a lesson I’ve seen many times talking to different guests: sometimes you feel like you’re late, but you’re rarely actually late to the wave. Kevin Van Trump told us this one time — he goes, “For all the best things, you always get a second turn to get on the train.” You feel like you’re late, you feel like you missed it, but often you’re not that late. Don’t talk yourself out of it.
Shaan: According to SimilarWeb, you get like two or three million visits a month now. The early website shockingly doesn’t look significantly different than how it looks now — you nailed it right out of the gate. Simple site, articles about picking the right name, how to install WordPress, selecting the right theme. Were you actually writing these articles? Because I know you’re an English-as-a-second-language person.
Syed: By this time I was already in college. I started high school at 12, started college at 16. By then my English had gotten much much better. I was writing these articles on WPBeginner, and I had a team of two other people helping me with the site.
Syed: The site looks similar now to what it was in 2009 — there was a period where I changed it and it was a mistake. People didn’t resonate with it when I changed the color scheme too much, so I changed it all back. And I haven’t changed it since 2012. The big lesson was: big companies don’t really change their stuff because they know if it’s working, don’t break it. As Charlie Munger says, don’t interrupt compounding unnecessarily.
Shaan: What tools do you use to figure out what articles to write? I imagine most of these are based on what people are searching for?
Syed: It’s a combination of that, and what people are asking through our contact form, what they’re asking in our Facebook group — which has probably over 90,000 members. And yes, we have our own keyword generator. If you go on WPBeginner, it’s kind of hidden on the free tools page. You put in anything — like “WordPress” — and it’ll tell you what people are searching for.
Getting Early Traction: Digg, Engagement Pods, and First Million [00:19:00]
Shaan: In 2010, a year or two after starting, you already had 26 responses on a random article I just clicked on. You were getting traction quickly.
Syed: A couple of things worked out for me. Do you guys remember Digg.com? It was really popular. I had a power user profile there, so one out of two articles I submitted would hit the front page. I used that to my benefit. There were legitimate and illegitimate ways to build that profile — I’ll admit it was a social circle thing. There were engagement pods on MSN Messenger and AIM. It was a group chat, everybody would dump their items in there and you’d upvote each other’s stuff.
Shaan: And what year did WPBeginner cross a million in annual revenue? How long did that take?
Syed: Maybe a year and a half or so.
Shaan: Damn. You crushed it right away.
Syed: So collectively — the content site and the listicle business together — past a million in about a year and a half. So about 2011, 2012.
Sam: So in your early 20s, basically at that stage, you’re a millionaire. You grew up with your dad working at a gas station — you told me every person in your family either worked at a gas station or if they were really smart, they got to be a bank teller. So how did you first see the possibility of being a business person? And how did it feel when the first million happened?
Syed: I’ll tell you how I knew it was possible. I used to play cricket. If you have listeners in Pakistan and India, you know they love cricket — I love cricket. So I was playing in South Florida leagues and I met this Pakistani gentleman who was the sponsor for our team. He was this crazy cricket fanatic, and he became my mentor — he’s a family friend now.
Syed: Back then, I see this Pakistani guy driving an S-Class, super humble, super nice. I’m like, “What do you do? Are you born into money?” He’s like, “No, I have real estate. I came to the US with 500 bucks in my pocket.” After games he would take us out to eat, sometimes invite us to his house — this like 15,000, 18,000 square foot house. His kids were my age, so we’d hang out. Sometimes we’d watch cricket games there because of the time zones. In between breaks, I was the one who took interest in his business. He’d tell me stories like, “This is how I took over a Burger King for free,” or “This is how I started.” I absorbed a lot of early lessons on business, finance, and hustle from him. He was always encouraging, always asking how things were going.
Syed: So that was the early stage of me knowing, “Oh, this is possible.” Nobody in my family had any wealth — they were just working at gas stations.
Syed: In terms of how it felt when I hit my first million — you’d think it would be this joyous moment. But I was more scared than anything. The question I had in my 20s was: is this gonna last? You come from nothing and you have this thing and you’re like, “What am I supposed to be doing? I have no guidance.” There was this inherent fear. So I always lived way below my means.
Syed: When I was in college, I did not buy any furniture. I just slept on the floor on a blanket — that’s how I grew up in Pakistan, so I was like, “I’m not gonna buy any furniture, why waste money with this.” I had a blanket and I got a desk from Goodwill. That’s what I worked on.
First Inflection Points: Opt-In Monster, ListPosts, and the Gas Station Strategy [00:25:00]
Shaan: What’s amazing is I would have thought the first million came sooner than 2012 — but because in the next 10 years you’ve thrown that from one to $100 million plus. When were the inflection points?
Syed: I launched OptinMonster in 2013 and List25 in 2011. Those things started really cranking. I had some really sweetheart affiliate deals with certain companies that worked out really well. And we were coming out of the recession, so there were still real estate deals to be had. I bought my first gas station primarily because I wanted to offset expenses with an appreciating asset — that was the lesson I learned from my mentor.
Sam: Let’s talk about that. What was the logic for buying a gas station when you found out you were having a kid?
Syed: One of the things I learned from my mentor early on — I was like, “How do you justify buying a Mercedes? That’s a depreciating asset.” He’s like, “Yeah, but when I drive it, people think of me better — there’s an impression game. But the way I justify it is I buy something that’s an appreciating asset like real estate, and I use the income from that to pay my lease payment. My principal never disappears.”
Syed: I was like, “That’s a good idea.” Your principal continues to appreciate, you use the income to offset the depreciating purchase, and it keeps you disciplined — you’re not going to overspend because you’re forced to think in assets rather than monthly payments.
Syed: So when I was about to have my son — I was 26 at this point — I had all these VC firms reaching out. I could have had a solid eight-figure exit. I had offers at around $70 million.
Sam: For WPBeginner?
Syed: No — for OptinMonster and the gallery solution and WP Forms and analytics combined.
Sam: Were you close to taking it?
Syed: I definitely thought about it. But then I was like, “What would I do afterwards?” My son is going to grow up seeing me not work. And honestly — what instilled my work ethic was watching my dad work. I wanted my son to see that.
Syed: Also, I wasn’t ready to give up my baby.
Sam: Fair enough. So what was the gas station logic specifically when the baby was coming?
Syed: So at that time, my son is about to be born and I’m thinking: “How much does a baby cost?” And I’m like, well, if I buy something that gives me at least $5,000 or $6,000 a month — now the baby costs are covered no matter what happens to me. My family is taken care of. So yeah.
Sam: What most people do is take the money they make and say, “All right, that’s what I have to spend.” What you do — from your mentor — is take the money and it has to go buy an appreciating asset that will spit off cash flow. Then you can spend whatever that asset makes. It’s kind of a savings program where you go buy the gas station, the gas station pays you, and that pays for your child. It’s not you providing for your family — the gas station is providing for your family.
Syed: It allows me to sleep better at night and to be more bullish in the deals I’m doing.
Sam: How many gas stations do you have now?
Syed: Ten.
Sam: And you own a bank too?
Syed: I bought a bank — well, a bank building. There was a Wells Fargo I used to ride my bicycle around. I couldn’t even go in the bank — I didn’t have a bank account at the time. I’d ride my bike over to that area because there was a Sports Authority and Office Depot nearby. I bought that building.
The WPBeginner Business Model: Traffic, Affiliate, and Recurring Revenue [00:32:00]
Sam: What amazes me is — SimilarWeb might not be right, but let’s say two to five million visitors a month. That’s a lot. That’s high-intent traffic — people coming to buy something. But it’s just amazing to me that much traffic has created so much value.
Syed: When you start an online business, most people think about a CPM or CPC monetization model. But there are other and better models. You can have CPL, CPA, recurring commission. Once you understand the difference between recurring revenue and reoccurring revenue, you start thinking about your business differently.
Sam: Explain that for listeners — CPM meaning $10 per 1,000 visitors for a display ad, versus cost per lead or cost per acquisition where someone pays $100 per month and you get a cut while they’re a customer.
Syed: Exactly. And there are verticals where you get paid on a lead basis — hundreds of dollars just for a lead, not even a sale. So I did a lot of those, and I still do.
Sam: Has the WPBeginner revenue grown like the rest of the business, or are you fine with it just being a steady $10–15 million a year with like 50% margins?
Syed: Pretty much. On a content business, you cannot compound it the same way you can a software business. Eventually you hit a traffic mass, you can unlock as many levers as you can, but the compounding will slow because it’s reoccurring revenue — the person I referred this year, if they leave, I’m not going to get that plus new customers next year, which is what happens in a software business with recurring revenue.
Syed: So yes — WPBeginner has grown, but not at the same pace as the software companies. That’s a big mental shift between recurring and reoccurring revenue. Once you understand that, you start thinking differently about your business. I took all of our profits and invested in software and tools. I still have niche tools not even related to WordPress that I bought off Flippa or through private outreach. I paid one guy $15,000 upfront for a tool, and in the very first month it made me $18,000. Now it makes me over $10,000 a month in pure profit. Nobody touches that tool. Hosting cost is maybe $8 a month.
Syed: So you can have these cash flow income streams coming through. That’s how I was able to buy businesses without any outside financing or outside debt. I was also in a market that wasn’t fully mature — those shrewd PE firms and VCs didn’t understand the market. I could see the potential. I might buy something with no revenue but a user base and say, “If I do X and Y, this can be a seven-figure business.” I might buy something for six figures, and in two years it makes seven figures in profit.
The Investment Philosophy: Buying on Margin of Safety [00:38:00]
Sam: You told me something once that sounded like a real estate philosophy — “you make money on the buy, not on the sell.” You’d come into a deal knowing you had both a margin of safety and a plan for how the business would be different than what the current owner valued it at. Like, you’d know you could renegotiate payment terms from 3.5% to 2% because you have the contract already, or you could throw WPBeginner traffic at it. You make the money on the buy because you already know the advantages you’re bringing.
Syed: 100%. This was one of the lessons I learned from my mentor who had the real estate background. The philosophy is very much derived from real estate — you make money on the buy. Otherwise, if you’re paying a high multiple based on future projections, yeah, that might work out, but it has much bigger risk.
Syed: From my perspective, I want “heads I win, tails I don’t lose much.” I got that formula from reading Mohnish Pabrai’s book. I’m a huge fan of his — he’s now a friend.
Sam: Explain that more — heads I win, tails I don’t lose much. What does that mean and what’s an example?
Syed: A good example: if a business’s intrinsic value in your perspective is $1 million, and you end up paying $700,000 today — heads, you know you’re going to win if this business continues growing. Tails, you still have so much upside because you paid $300,000 less than market value. For something to go wrong to where you actually lose money, it has to go like 40% wrong, and even then you only lose $100,000. So you need to look at the deal and ask: what are my downsides? You have to invert the situation. Think about how you’re going to die in this, and then don’t go there.
Shaan: You sort of have this “pay attention to the cents and the dollars will follow” vibe, where you’re doing things that look small but because you own 30 or 40 of them, they’re really accumulating.
Syed: Exactly. When you come from nothing, you have a good sense of where the money is going to go, and you have to be very conservative to not lose it all. I came from nothing and I don’t want to go back to that. So I’m very cautious.
Syed: The funny thing about compounding is that if you compound at a healthy rate — I’ve been compounding in double digits for the past 10 years.
Sam: What would be considered good? Like 20? 30?
Syed: I’m more than double private equity. The market compounds at around 8%. Private equity might get you in the teens. I’m way way above that. And that only happens when you can identify a mismanaged gem — somebody has a business and they’re only thinking about monetizing from one angle, not thinking about it from a full perspective.
Syed: I look at it and say, “Yes, this is the current revenue today, and I’m getting a bargain on today’s revenue. But here are my contracts with so many different partners and vendors that I can unlock extra revenue here, here, here, here, here.” I turn a business that has one revenue stream into a business with multiple revenue streams. And I do it enough times and just let it compound.
Syed: These businesses are not going to hit a billion dollars in revenue — that’s not what’s happening. But they’re going to consistently compound because more people are going to need websites. The web presence just keeps growing. I had a Tailwind — WordPress was going to keep getting more and more popular. That’s a generational Tailwind.
Distressed Assets vs. Mismanaged Gems [00:45:00]
Shaan: Our buddy Mo has this phrase: “The two sexiest words in the English language are ‘distressed asset.’” And you just said “mismanaged gems” as your catchphrase. I like that idea, but I’m kind of a lazy guy and when I hear “distressed asset” or “mismanaged gem,” I think: work. I gotta go clean up. I gotta manage this better. Isn’t that going to take a bunch of work and mind share to turn things around, versus just buying a beautiful business that’s already working and letting it grow?
Syed: I think “distressed asset” from a real estate perspective is slightly different from a “mismanaged gem.” My early real estate buys were distressed assets — banks needed to get properties off their books, I was a cash buyer, and I had the right contacts. I was able to buy gas station properties that were already leased out to Couche-Tard, the Canadian multi-billion dollar company that owns Circle K. All I had to do was give cash to the bank and take the deed. Those are distressed assets. And I got lucky — I paid $90,000 all in for one, but you had to do environmental cleanup on that thing. Okay, that was work.
Syed: A mismanaged gem is a property where, due to lack of effort or lack of experience, someone hasn’t fully understood the potential. You might be a creator with a large user base and you just haven’t thought about all the different potential monetizations that could come from that one business.
Shaan: We have a friend who was looking at businesses on Flippa, and they said, “I just want an owner who cared a lot about product.” The business had like 95% of the owner’s brain stamped with “product.” So they’d ask, “What were you doing for marketing?” And they were like, “It’s word of mouth.” And they were so proud of the word of mouth. The whole play was just: start doing Facebook ads. What’s the budget? Oh, like $8,000 a month. And they wanted to spend $80,000 a month. That was literally the only change. You think, “Oh, this person made $20 million — they must be a genius.” And it’s like no, I just found a business where someone only thinks about product and spends almost nothing on marketing.
Syed: The other thing that worked in our favor was the ecosystem effect. If I buy an analytics software, I can cross-sell OptinMonster — and vice versa. If I buy MemberPress, I know that everyone creating a course will need OptinMonster for lead generation, or will need analytics to track everything. The synergy compounds.
Managing a Billion-Dollar Portfolio Without Stress [00:50:00]
Sam: I read somewhere that you said you don’t buy 100% of companies anymore — you try to buy 49%, because you can’t run all of them. And in our pre-call you had this quote: “How I manage a billion-dollar portfolio without stressing out.” When I met you, you were like, “I love to travel. My family — we go travel.” I thought you meant like, I don’t know, the Grand Canyon. And you were like, “We’re going to Egypt, then the Serengeti.” I thought, okay, this guy does exotic travel every month. And you said something like you stack calls with your operators in the last week of the month, that’s your only time to stress out or think hard about those, and then the rest of the month you’re reading, playing basketball, doing other things. Is that accurate? And how are you managing a billion-dollar portfolio without stressing out?
Syed: That is fairly accurate — but I want to emphasize it didn’t start that way. I didn’t figure this out until maybe two years ago.
Sam: What were you doing before that?
Syed: I would have to go in sometimes and clean up a business when it was going wrong. I’d get involved too much.
Sam: Were you a hard-ass?
Syed: Depending on who you ask. According to me, no. According to everyone I ever worked with — hell yeah.
Shaan: You seem like you have a ruthless side, even though you’re polite and kind.
Syed: I was disciplined. Ruthless might not be the right word.
Sam: That was ruthless, the way you said that. I love it.
Syed: The trick is — people say “hire good people and get out of the way,” but that sounds easier than it is. We use EOS — Entrepreneurial Operating System — in our companies. As transparency and accountability. Oftentimes when I bought businesses from founders who started delegating but really abdicated, the business went down and the founder was burned out. That’s actually a mismanaged gem — because all you’ve got to do is put back those accountability structures and maybe put in the right team member, and it’ll start kickstarting again. You have to delegate, but not abdicate.
Syed: The P&Ls for all our companies are managed by my finance team at the HQ level. The EOS scorecards and good P&L monitoring give you that accountability piece.
Ideas for Starting Over: Service Agency, AI Wrappers, FOIA Arbitrage [00:55:00]
Shaan: I want to talk a little about ideas. You’ve been building cool stuff and making money since you were 12. What ideas or opportunities do you see that somebody else could do? Things you’re too busy for or they’re too small for you now?
Syed: I think about cash flow. If I had nothing and was starting over, of course it’s a lot easier for me now — I have the means to just go invest or go do deals. But if I was starting all over, the first thing would be to build cash flow again. And the easiest way to build cash flow is services — an agency business.
Syed: Right now, a content agency using AI — I would crush it. Because brands like Shopify are using AI agencies to create top-of-funnel content. There’s some human editing involved, but this changes the game because if an article used to take four hours to write, now you can do it in 45 minutes if you know the game. So a hustler younger version of me — that’s what I’d be doing. Content agencies, copywriting agencies, all AI-powered plus human review.
Syed: I would use tools like Clay.com to automate my sales outreach. You dump a profile in there, it finds all the data on that person, you use GPT to write emails to them, and then you hit them up. Not everybody, but a small portion will take you up on it. You deliver a great service, go above and beyond, watch the word of mouth take you places, and you raise prices.
Syed: That would be step one: build cash flow. Then figure out how to convert that cash flow into recurring revenue. Because in an agency, you still only have reoccurring revenue, not recurring.
Shaan: And then would you buy versus build from there? Talk about that distinction — because you started as a builder and you’ve now bought like 30 companies along the way. You studied not just Buffett and Munger but also Mark Leonard at Constellation Software. You told me there was something in his annual letters that really stood out about building versus buying.
Syed: Yeah, it was one of his earlier letters — maybe the third or fourth one. Mark talked about three types of growth Constellation was experiencing. One was organic growth — just the business growing organically, maybe 7 or 8%. The second was revenue growth through acquisitions. The third was “initiatives” — new builds, where you have a product and you’re going to build a second product.
Syed: And he said: these initiatives turn out to be very expensive. They require more resources and time than you planned. They take away the time of your senior people. And you’re not even counting those opportunity costs. From a pure capital allocation perspective, the return on invested capital isn’t always great because builds have higher risk. If it doesn’t work out, that’s it. For the first year or so when you’re building, there’s zero percent return on your investment. So the compounding return is lower.
Syed: My takeaway was: you can have ad spend equal to three years of CAC, at which point it might just be better to go buy a company that has guaranteed revenue, and then cross-promote.
Shaan: One thing I am — and I think Sam is like this too — is a natural shortcutter. I like finding the simplest path to the solution. So while creating is exciting, there’s a beauty in just finding a simpler way to win. Building something new has a high chance it’s just not going to work. Buying something that’s already working — yes, you’re out cash, but are you actually taking more risk? There’s a difference between putting out cash and putting out risk.
Syed: Exactly. And I was very much an artist in the early days — I enjoyed putting my fingerprint on things. But a big mindset shift that happened in my career, which has led to tremendous growth for Awesome Motive, was going from creator and operator to capital allocator.
Syed: This happened when I was studying Buffett, Munger, Mohnish. Buffett says, “I’m a better investor because I’m a businessman, and I’m a better businessman because I’m an investor.” You read that and you’re like, “Okay, sounds good.” But when you think about it from first principles — the commonality between the two is that both investors and businessmen are resource allocators. Capital allocators. When I tied that together, that was the aha moment.
Syed: If I start this new thing, yes, I’ll make X. But if I shortcut it and buy something doing $2 million in revenue — 20 or 30% of $2 million is always going to be better than 30% of $100,000. You see what I’m saying?
Sam: What’s the biggest check that made you sweat?
Syed: None of them made me sweat, because I’m not putting 80% of my net worth in any one deal.
Sam: Have you bought things for tens of millions?
Syed: No. Nothing in the tens of million dollar range. Single digit millions.
Shaan: That is insane — that you’ve built that much value with small little cigar butts.
Syed: Mostly all cash upfront. There might be some pieces of seller financing, but one of the advantages we have compared to someone offering a higher valuation is that we make the process really seamless for the seller. That also lets us get a better and more attractive valuation.
Syed: With private equity, you’ll be dragged along for six months, they’ll ask you for all sorts of nonsensical stuff, and by the time the entrepreneur is burned out, it’s just a shitty feeling. With us — you send a message through the website, my assistant sources through it, I’ll look at it and say okay, ask for the P&Ls within a week or so, give you an LOI, and we can close in 30 to 40 days after that.
Sam: Are you the only decision maker?
Syed: Yes.
Sam: That’s insane.
No Debt, No Leverage, and the Story of Rick [01:04:00]
Sam: You told me a story about risk, because I asked you — “Okay, you buy all this stuff, how much debt do you have?” And you were like, “No debt.” Even with his mortgages — wait, no mortgages?
Syed: No mortgages. And look, there are a lot of financially savvy listeners, and I have many financially savvy friends who are billionaires, and they disagree with me on this. In Pakistani culture, leverage is considered bad, it’s considered taboo. And sure, leverage can help you grow faster when used smartly. But it also takes away the margin of safety, which in troubled times can destroy your autonomy if you’re not careful. So I’m okay with getting rich slowly. And I think I’ve done all right for where I am. I see myself as the turtle in a turtle-and-rabbit race.
Shaan: Dude, you’re a 32-year-old pretty much billionaire. You’re slow?
Syed: I’ll be okay. It helped me sleep better at night and be more bullish.
Sam: Do you know about Charlie and Warren’s third business partner?
Shaan: No. Tell the story.
Syed: So they did have a third business partner — his name was Rick. He was just as smart as them, but was in a hurry to get rich. Mohnish asked Warren about what happened to Rick at one of their lunches — this is public. And Warren said something along the lines of: “Charlie and I always knew we would become incredibly wealthy, but we were just not in a hurry. We knew it would just happen. Rick was just as smart as us but he was in a hurry.” So in the 1973–74 downturn, Rick had margin loans and was highly leveraged. The stock market went down 70%. The margin calls hit, and he had to sell his personal shares to Warren for like $40 apiece.
Syed: Now the same shares are worth half a million plus. I’m gonna get a framed picture of this guy Rick on my wall as a reminder every day: don’t be in a hurry to get rich. It’ll happen. Don’t be in a hurry.
Shaan: That’s going on my wall.
Level Two Ideas: AI Wrappers and FOIA Arbitrage [01:08:00]
Shaan: Going back to ideas — you gave us the first move: cash flow through a service agency, content or lead gen, using AI for leverage. That’s the escape-from-broke-jail plan. Now you’ve done that. What are the level-two opportunities you see?
Syed: I would look into the quick cash cow of tools. Right now there are these AI wrappers — upload your PDF and we’ll turn this into a ChatGPT interface. There are several of those out there. But you can make it vertical-focused. ChatGPT for lawyers — add all your internal SOPs and now your team can just talk to it. Real estate internal processes. My team built this internally in about a week. It’s not very hard to build. You can pay somebody on Upwork to do it. Then work with the different AI influencers on TikTok and Instagram, and this can easily get you to $10K plus a month. I know several people making over $10K a month, some over $100K a month, just doing AI wrappers. That’s pretty easy.
Syed: I would also look at how to leverage the Freedom of Information Act.
Sam: What is that? We used to use it at The Hustle all the time.
Syed: Okay, so in the United States — and this only works if you’re in the US — there’s something called the Freedom of Information Act that allows you to request any kind of data from any government-run authority. Usually journalists use it. You can get creative with it. You can go to a government agency — maybe a university — and say, “Hey, I want to see the contracts of your last three or five construction projects.” That gives you an inside look at the terms and pricing that were approved, so when you’re submitting your bid, you’re coming in better informed.
Syed: I remember talking to a guy in the Atlanta area who would request student information from public universities. He was targeting nursing school graduates. Schools have to give it to you — you might pay a processing fee of like $100, but you get the whole graduating class’s name, email address, physical address. He would send those students an affiliate offer for a student loan forgiveness program. The affiliate company charged students like $500 to $600 to fill out the forms, and they’d pay him. He said, “I sent one email, I make six figures, and I move on.”
Syed: I would find arbitrage opportunities like these to build more cash flow. And you know, Sam, in the early days — while I was very focused on WPBeginner — there were a lot of creative things happening like this that were helping my cash flow grow, which allowed me to invest in software.
Sam: I’m not going to dig about this — but there’s got to be one prolific one. I’ve heard a bunch through friends of friends and I’m not going to mention any of them. I’ve heard some of your things. Everyone in this space starts sometimes black hat or gray hat, and then as you start making real money you’re like, “All right, I gotta go legit.”
Syed: Justin Mares had a good phrase: “Do whatever you got to do to make your nut, and then go on your noble mission.” I don’t know if I fully agree with that, but I like the way he said it. I know several people who did that — like, “What were you doing before this?” “Oh, I was running a dating site affiliate network.” And it’s like okay, this is not where you want to hang out for too long. Poker affiliates, ringtone subscriptions.
Sam: There was one guy who emailed me — I think he said I could share this. He goes on Sportsbook A, they have a welcome offer of, say, 100% match up to $1,000. Sportsbook B has the same welcome offer. He maxes out both welcome offers, bets on opposite sides of the same game, loses the small rake, but takes both welcome offers. “Let’s do that again and again.”
Liquidity, Net Worth Allocation, and Learning to Spend [01:15:00]
Shaan: Have you ever had liquidity from selling a business, or does the majority of your liquid wealth come through annual cash flows?
Syed: I’m pulling massive chunks from the business. In terms of liquidity events — yes, I sold two businesses, relatively small seven-figure exits on both. One was a YouTube channel business and another was a photography software business. But the bulk is cash flow from the portfolio, which I move up to the hold-co level and then use to invest in private businesses, real estate, and public markets.
Shaan: If you had a pie chart of your net worth, what does the allocation look like?
Syed: It’s still heavily skewed toward the online business portfolio. Extremely heavily skewed. Then a good chunk is in public stock markets. Then cash.
Sam: Do you actively manage your public portfolio?
Syed: A big chunk is boring — dollar-cost averaging into index funds. I’ve begun to play with a little bit of money to see what I can do. Stocks only — I was only talking about public investments. Real estate is separate.
Sam: You talked about coming from nothing — literally sleeping on the floor because you were like, “Why would I buy furniture?” Even when you had money. You believe money is a tool, not the end goal — it’s a tool to enable something, and there’s no point except to enhance your lifestyle, other people’s lifestyles, and improve lives. Spending money is as much of a skill as making money. Have you learned how to spend money?
Syed: Yes. In the early days I saved everything. I did not buy a bed until I got married. Just to put in perspective — even when we were dating, ladies, find you a man with no bed.
Syed: I met my wife in high school, so she’s known me since I was broke. Her parents weren’t that well off either. In terms of learning how to spend — yes, for me and my culture, we take care of family first. My first thing was to ensure my parents are retired. My dad worked really really hard when we moved to the US. My parents are retired now. They go to Pakistan maybe four times a year.
Syed: In terms of traveling — I realized I get a lot of creativity and joy out of going to see new places. I spend the money on those.
Ownership Structure and What Drives Him Now [01:20:00]
Sam: Are you giving equity to your operators? Is there a hold-co that you fully own, and then the hold-co owns 80% of this company, 70% of that company?
Syed: In the early days, yes. Now I don’t do that.
Sam: You don’t give equity to operators anymore?
Syed: No.
Sam: Do you regret giving equity?
Syed: No. I enjoy working with those co-founders, and I don’t think I would have been able to do what I did without them.
Sam: You’re only 32. What gets you up in the morning and feeling motivated now?
Syed: I want to build a generational company.
Sam: Sounds like you’re there though.
Syed: I think it’s generational in the long sense — when my kids are older and grandkids are around. I’m probably going to be doing this until I’m dead. I enjoy the game. I enjoy the fun of it. I get a thrill out of finding a deal, finding an edge. In some sense just getting an unfair advantage — but knowing the tricks, knowing the tactics, giving me a head start. Like if you play basketball, some people have been doing it for a long time and they have tactics. They can just cross you over. I like having those tactics in business.
Sam: What’s crazy is you might be in the top 50, maybe top 100 or 200 richest under-40-year-olds in America.
Syed: I’ve kept a very low profile, and the only way that would be validated is if I ever ran around bragging or if I exited. Right now my assumptions are based on what similar companies trade at, but it actually doesn’t matter to me one way or another.
The Buy-Not-Build Model and Common Mistakes [01:24:00]
Shaan: There are a whole bunch of people trying to do this model right now — buy don’t build, become a hold-co, build a portfolio. I’m sure you get a bunch of questions. What do you think they get wrong? What’s the common mistake or trap smart people fall into trying to do this?
Syed: Several things, but the primary one is that the excitement takes them away. They’ll overpay on a deal and regret it later. Oftentimes they’re using investor money, they’re on a timeline — most of them are trying to raise a fund with a 10-year-plus-two-years structure. So they’re not disciplined enough to wait.
Syed: I have no rush. If I don’t buy a company this year, it makes no difference. That allows me to be more measured and disciplined in the deals I do. That’s probably the biggest thing.
Syed: The other thing is underestimating the problems that exist in a business.
Sam: The first interview I saw with you was on Mixergy — our friend Andrew Warner. I think it was around 2014, maybe even earlier. Andrew was like, “How much revenue do you do?” And you said, “Andrew, I told you I’m not going to tell you this.” And it was pretty funny. Then I asked you to come on here and you were like, “I’m not telling you these numbers.”
Sam: But you’ve told us a lot today. It seems like you’re in a different place than you were before — you don’t mind talking about some of this stuff. You’re maturing from a gray-hat hacker from 15 years ago to kind of a tycoon.
Syed: When I was younger I was afraid — from a taboo standpoint, and also I wanted to fly under the radar. I struggled with vulnerability. That changed as my network changed, as I continued leveling up. Now I’m in forums and peer groups, and those groups really help you mature, find your blind spots. I’m appreciative of the friends who call me out on things and have helped me become better.
Closing: Net Worth Post, Annual Reports, and What’s Next [01:28:00]
Sam: Before we wrap up, I want the listener to Google this. Google “Syed” — S-Y-E-D — and then his last name B-A-L-K-H-I, and then “net worth.” He has this hilarious blog post.
Syed: Oh, this is yours? Sam told me about this.
Sam: Yeah. His website comes up first and the first line is, “You’re probably thinking I’m some sort of narcissist writing about my own net worth in third person. It’s quite the contrary.” He was looking through search traffic for his blog and noticed a lot of people were just searching his name plus “net worth.” So he wrote a post explaining — it’s always changing, and knowing someone’s net worth is not going to help you succeed. Very funny.
Sam: Also — we talked a lot about money, but you’ve got amazing posts where you do an annual wrap-up. I’ve been reading that for years. I think you started in 2015?
Syed: 2015, yes.
Sam: You put a big emphasis on philanthropy — you have a school in Pakistan, I think — and you’re giving away a lot. And it’s you and your wife and your kids, and a lot of this personal stuff. You have your own foundation. So to reiterate what Shaan said about being a holistic person — your personal website does a really good job of explaining that.
Syed: I started doing those write-ups when we found out we were going to have our son. I’m like, “I should start recapping what’s happening in my life so that at some point I can show him — check this out, check this out.” That’s how those year-end reviews came about. And I enjoy writing them. A lot of people love reading them, including you. Thank you, Sam.
Syed: In terms of education — I do believe it levels the playing field, and that’s why we do what we do.
Shaan: Sam gave you a compliment, so I’m gonna make fun of you. The homepage needs a revamp. You’ve got “entrepreneur, investor, and marketing extraordinaire” — with “extraordinaire” — and there’s a photo of you with a headset and a clicker doing the hand gesture, talking about starting with why. You’re above that now. You’ve elevated to tycoon status. You need the super minimalist thing where it’s all white and it says something like, “We buy companies of all sizes. Please inquire.”
Syed: If you go on awesomemotive.com — or am.co — that website says “Helping small businesses grow and compete with the big guys.” That’s the one I want people to know about, not me personally. I barely spend any time on my website. I write once a year, that’s the year-end review, and that’s really more for me than for anybody else.
Shaan: That’s a good one.
Sam: Dude, do you want to keep coming back? You gotta keep coming back — you’re fun to talk to.
Syed: Yeah, I enjoyed it. Happy to come back.
Sam: I told you — we’re not the worst.
Syed: I loved it.
Sam: More importantly — are you in for Camp MFM part two? We’re about to host in a few months.
Syed: I’m in.
Sam: All right. And that’s the pod.