Sam brings a lineup of “frame-breaking” businesses — companies with a massive gap between how unimpressive they look and how much money they actually make. The episode covers a VPN affiliate site sold for $100M+, a publicly traded lead-gen company with a broken website doing $600M in revenue, AJ Patel’s journey from dog vitamins to a $650M exit, and the quietly massive Wonderful Company empire (Fiji water, Pom Wonderful, Wonderful Pistachios). The conversation also wanders into tax residency law, the nature of SEO, and what separates founders who take action from those who don’t.
Speakers: Sam Parr (host, co-founder of The Hustle), Shaan Puri (host, founder of Milk Road)
Cold Open: Dog Vitamin Teaser [00:00:00]
Shaan: So in like 2012, 2013, 2014 he started a vitamin brand and it only did okay. And then he started also tinkering with a skincare brand, which actually did much better — it got to like $10 million or so in revenue. He hired a CEO, the CEO kind of drove it into the ground and didn’t really do that well. So he started focusing again on his vitamin brand and he’s like, “Look, it’s doing okay — but who’s the best customer of a vitamin company?”
Sam: Dogs.
Shaan: Because you — and this is it, I’m not disparaging him — but like, do they work?
Sam: Yeah, why not? Fugazi, you know? Forget it.
Shaan: Welcome to Fugazi Inc. Supplements for dogs. They’ll never tell you if it works or doesn’t work.
Intro: Taxes, Rich People Problems [00:00:30]
Sam: What up, what up. Are we supposed to like start with a catchphrase now?
Shaan: Hey boys and girls, welcome to the business show where you learn how to make so much money that you’ll get taxed out the ass. That’s what rich people care about — taxes. If you don’t care about taxes yet, you ain’t rich.
Sam: Do you care about taxes?
Shaan: Yeah. I don’t — I’m not gonna live my life according to where the low taxes are, but it’s like the number two or number three thing I’m thinking about. I’m thinking about this whole New York / Texas thing. I do the math and I’m like, damn. Imagine I’m renting a place for, let’s just say, $20 grand a month — that’s how much taxes I’m paying by moving here versus staying. That’s a lot of money a month.
Sam: Well, you could do the Texas as your main residence and spend four or five months out of the year in New York. That’s not so bad.
Shaan: That’s not so bad. But I need to do it with New York and Florida, because Texas winter is not like “winter winter” — it’s not desirable enough that you’d want a winter there, you know what I mean?
Sam: Yeah. Dude, have you heard about the Teddy Bear Law?
Shaan: The Teddy Bear — what’s that?
Sam: So I was asking my tax guys — I was like, where do you keep your possessions? What’s the rule, is it six months out of the year? What does it take to have residency somewhere? And he was like, there’s a bunch of little factors. But one — and he said there was a famous case with Derek Jeter. Jeter played for the Yankees in New York but didn’t want to pay New York taxes — he wanted to pay Florida taxes. He said, “This is my home, this is where I live.” But you also have an apartment in New York, you play in New York, your kids go to school there. So it got ruled in court, and the name they gave it — I haven’t looked this up — is something like the Teddy Bear Law.
It’s basically: where would you keep your teddy bear? The place you’d call home. Factors like where your kids go to school, where the possessions you love are — it all goes into this umbrella of like, do you actually live here or do you just stay here for exactly six months and one day every year?
Shaan: When I first heard this I was like, wow, that’s really subjective for a law. But actually it’s one of the laws I kind of agree with. It’s like — what’s the spirit of this? Do you actually live here? If you’re working in a place, your kids go to school there, all your possessions are there, all your friends and family are there — that’s where you live.
Sam: As an avid listener of Dateline, one of the easiest ways to catch the husband who kills the wife is he either bought a trash bag and a shovel three weeks before, or he googled “how to dispose of a body.” Last night I found myself googling something and I was so embarrassed — I went to an incognito window. I was like, I can’t Google this.
Shaan: Like they’re gonna know you killed her.
Sam: Yeah. It was like: how does the state that you’re visiting know you’re there? If I live in Texas, how does New York even know I’m there if I’m just renting a place? I couldn’t even figure out how to phrase the search.
Shaan: Dude, I did the same thing. My queries sound exactly like “does the IRS really know?” Like somehow that’s how it formats in my search.
Sam: Google needs to understand — italicized “really” — like the asterisk and everything. There’s one browser that’s just like, hmm, this guy’s only ever incognito and he’s either looking at porn or taxes. What is this guy’s life?
Shaan: Basically you’re googling like: if the IRS does this, is that jail or just justified? Are taxes a recommendation or a requirement?
Sam: When I was Googling this I realized — the IRS is federal. I pay my federal taxes no matter what. But how does the state of New York actually know that I was ever there? And I want to be clear, in case they also listen to podcasts — I’m Googling this: A, for a friend, and B, to enforce the law on my friend. I’m just curious. Literally, how does the state of New York even know I exist?
Shaan: Same. I’m the same way. I go down this rabbit hole and then I’m like, 30 minutes in — why am I even looking at this? This is not applicable to me at all. But I just want to know how it works.
How the World Actually Works [00:07:00]
Sam: There’s this Twitter account I love — it’s called “How Stuff Works” or something like that. Today they posted a thing about how luggage gets loaded into an airplane. There’s a guy in the back and a conveyor belt shooting suitcases at him, and he’s stacking it like a perfect Tetris grid. And I love this account because it’s always things where I’m like — dude, how does the world actually work? I know I give them my suitcase, but what happens after that?
Shaan: It’s the same thing with taxes or, you know, how universities have endowments — what the hell are they doing with that? I’m always trying to get to the bottom of things and have an actual understanding of what’s going on.
Sam: I feel like I have so little understanding about so many things. But dude, I actually wrote about this — I’m doing the Maven ideation boot camp course thing again, and I started talking about the book I had as a kid called How Stuff Works. There’s another one where they split a power tool in two and you see a picture of how it operates.
The reason why researching — which is what you and I do for this podcast — is cool, is because whether you like it or not, America and most of the world is guided by capitalism and commerce. If you understand how a business works, just like those books show you how the luggage guy works, then you understand what’s possible and what’s not — why laws are the way they are, why art is the way it is. It’s not just about making money. It’s just like, how does the earth work? How does society work?
Shaan: I totally agree. And most people do this for science — like, why is the sky blue? There’s an element of that.
Sam: Here’s a perfect example. Like the luggage one — what happens if you just never pick up your suitcase? What happens if you just look at those bags sitting there that say they’re waiting for someone and they just never get claimed? Is this just going to pile up forever?
Shaan: You want to know the answer? I do know this.
Sam: Yeah, tee it up.
Shaan: There is an answer and it’s actually fascinating for somebody who keeps pulling the thread. There’s a company in rural Alabama — I think it’s Alabama or Arkansas — called Unclaimed Baggage. They sell $300 million a year worth of unclaimed bags. It’s like a huge thrift store.
Sam: Same thing with the shampoo at a hotel. I use this thing once — what do they do with it? Do they just refill it and give it to the next person?
Shaan: Actually there’s a whole company that recycles those. They take half-used shampoos from hotels — they tell the hotel, “We’ll pay you nothing for it, but we’ll come collect it for you, take it off your hands, because you can’t give it to the next guest.” Then they repackage and resell them. Their brand is around lessening waste on earth and they do extremely well.
So you find these little companies at the end of all these threads. It’s like there’s plankton that eats stuff off a whale’s head — there’s a little business that’s going to solve every one of these edge cases, all around the world. There’s a person whose job it is to do that thing.
Frame-Breaking Businesses: The Setup [00:12:00]
Sam: Which is a perfect segment for what I want to talk about today. I’ve got a bunch of examples of things I’m calling “frame-breaking businesses” — things I’ve discovered that changed how I think about stuff.
By the way, today I was thinking — today’s my leg day, because I’m putting you on my back and I’m carrying us for this episode.
Shaan: I’ve got a side note, by the way. My mom — I work out with my mom sometimes — and she said, “Sam Parr’s legs. He’s got strong legs.” She always calls you Sam Parr, full name. I love it. She was like, “I was just looking at his legs in the last video” — the Mr. Beast video, because you were wearing shorts on the couch — “I was just looking at his legs and I didn’t hear anything.”
Sam: All right, Mom. Shaan’s mom, text me, I’ll send you some pictures of my legs. It’s genetics, people. People comment on my legs — I was just born that way. Thank you, I appreciate the love.
Business #1: CompareTech — VPN Affiliate Site [00:14:00]
Sam: All right. So the reason I thought about this was because of Digg. There’s this website called Digg — if you’re above 30 you probably know it. Digg and Reddit were competitors, and for a long time Digg was kind of beating Reddit — both were like the “front page of the internet” type businesses with tens of millions of monthly uniques. Kevin Rose, the founder of Digg, was on the cover of TIME as like, “Meet Silicon Valley’s new wunderkind” — 28 years old and worth a billion dollars or whatever. He was like the next Zuckerberg.
Digg ended up not winning that battle. They’re currently for sale. I linked to their financials — someone just sent this to me on Twitter, so I’m not like, I didn’t sign an NDA. Someone just sent it to me, I didn’t ask questions, and I looked at it.
Shaan: You signed an FDA — a Full Disclosure Agreement — where you’re like, I will put this on blast if you send random stuff to me.
Sam: Yes. An anonymous Twitter account — that’s exactly what happened.
So here’s the overview: over the last year they had 27 million users. Two million a month. The Hustle gets more than two million a month just on our website and we don’t even try to get traffic there. So two million a month — their revenue for the year was like $1.2 or $1.3 million. Nothing.
Shaan: Dig which was supposed to be like a great website doing only like 44-91 thousand dollars a month in revenue. Horrible.
Sam: Terrified small boy energy. But here’s the thing — this is what I’m calling “the gap.” The gap between how much we talk about them, how much prestige they have, the accolades they get — versus where they actually are in reality. That gap is huge.
So instead, I’m going to show you the good kind of gap. Companies people don’t talk about that are actually phenomenal.
The first one: I was looking at Michael Bisping — he’s a YouTuber for MMA — and a VPN company sponsored him. I thought that was kind of strange. So I Googled “best VPN.” A VPN, if you’re in America and you want to tell the internet you’re in Europe, or if you’re somewhere and want to act like you’re in America — that’s what it’s for. Or if you just want to search the web anonymously and Google stuff about taxes.
I Googled “best VPN” and I came across this website called CompareTech. I started reading it, looked them up on SimilarWeb — they get millions of views. I scroll all the way to the bottom and notice they’re based in England. And the thing about England: if you are a UK company and you do over a certain threshold — maybe $10 million — in revenue, you have to file with something called Companies House. It’s like their IRS, where you can go log in and see the financials from privately held companies.
Shaan: Can you see what their financials are? Do you have it up?
Sam: Yeah. So the link broke on me but basically — their revenue for the trailing 12 months was $12 million and their profit was $10 million. This little website that just reviews VPNs. It’s not good-looking, it’s not sophisticated-looking. And I believe this website sold for like $200 million. I think it only gets like a million visits a month. It sold last year, or six to twelve months ago.
Shaan: That’s crazy. And it was only started in 2015.
Sam: Sometimes I see these sites that get so much traffic and they just send clicks out to whichever VPN. Their business model is: they write about which VPN to use, link you to the VPN, and get a kickback from every link you click. If the VPN says, “Every customer’s worth $300 to us, we’ll pay $100 to anyone who refers a customer” — these guys do some version of those numbers.
Normally when I see really high-traffic sites that look very basic, it’s like, this was started in 2004 — props to you for having the foresight in the early Google days to start reviewing credit cards, reviewing VPN providers. Somebody made whatisthebestemailsoftware.com and they rake in six million dollars a year, ninety percent profit margin, and the person’s spent the last 15 years trying to figure out the meaning of life because they already won the business game.
But 2015 is pretty new for a site like this. And here are the Companies House financials: in 2021 they did $15 million in revenue and $13.2 million in profit. The year before that — $10 million in revenue, $9.5 million in profit.
Shaan: That’s crazy. I’m a big fan of these. Do you play with SEO a lot?
Sam: Growth tactics are like martial arts. You could be a black belt in jiu-jitsu and know nothing about karate. You know karate and know nothing about taekwondo. That’s how I feel about growth channels — I’ve spent a lot of my career figuring out virality, spent a lot of my career figuring out paid marketing for e-commerce. The thing I’ve never touched is SEO.
Shaan: I know SEO like an Ivy League architect knows about construction. I can have a conversation with the construction worker who’s going to build my project and kind of follow along, but I’m not going to be able to reference which rivet to use, and you could kind of lie to me sometimes and I wouldn’t exactly know. Put me on the job site and I’m gonna ask for some gloves because I don’t want to hurt my hands. Everything’s going to be called a monkey wrench.
Sam: You know that scene in The Office when Dwight and Jim are doing the job interview thing and Jim’s like, “Dwight, which bear is best?” And Dwight’s like — “That’s a stupid question. There’s basically two schools of thought.” That’s how I feel about “is SEO best?” It’s like — I don’t know, is brown bear best or is it black bear best? Every one of these growth channels has something awesome and something terrible. The one you’re in, you know it too well, and you’re like, “This thing is awful, I wish I could just spend money on Facebook.” And the Facebook guy’s like, “Oh my god, you can get free traffic on Google.” And the Google guy’s like, “Holy sh*t, this thing grows virally? What is that?”
Shaan: I agree. There’s no best.
Sam: Anyway. CompareTech sold for over $100 million this year. Give me another frame breaker.
Shaan: Great first one. Real quick — a PS here. At Milk Road, our business model is newsletter ads. I had asked Ben, “If we were going to sell a product instead of advertising other people’s products, what would work best?” And he was like, “VPN, dude. We should just launch our own VPN. Fits the audience. We just have to buy an existing VPN and plug in our distribution.” So if anyone has a VPN they want to sell me, I’m happy to either buy one or build our own.
Sam: You’ve got to come up with cute branding. Like, “VPNope — you can’t track me.” You can’t just call it VPN.
Shaan: Something like Mysterio. Secret Juice. Don’t Tell Mom.
Business #2: QuinStreet — Lead Gen Machine [00:25:00]
Sam: All right, the next one. Have you heard of QuinStreet?
Shaan: No.
Sam: Google QuinStreet and go to their website. Tell me what you see. My guess — if you told me nothing else — is that I thought this was a fashion brand.
Shaan: Okay. I just see a guy and it says “Where performance drives digital” and then there’s another stock photo and this guy “accessing high-intent prospects.” These guys on here — they’re not ugly enough to be a stock model and they’re not good-looking enough to be a model. They look like they’re out of a Telemundo commercial. Just normal. So normal they don’t even look real. Why does your skin have normal-people wrinkles and blemishes? That’s not right for a stock photo.
Sam: Is it the founder?
Shaan: I don’t know who the founder is, but it’s a simple-ass website that is not good-looking. I’m going through the slideshow — this slideshow is hilarious. This looks like Meredith from the office.
Sam: That’s what I’m saying. So normal they look silly. Okay, here’s what this company does. They used to own sites like directoryofschools.com, campuscorner.com, learningandlife.com, findtherightschool.com — just these boring-looking websites. And when you Google “Ohio auto insurance” they come up number one. You enter your information and they sell that information to the highest bidder. This website that looks simple and ugly — they made about $600 million in revenue last year. And it’s publicly traded.
Shaan: That’s crazy. Another frame-breaking company. Like they have — if you click their About page, the forms don’t even work, they go to a 404.
Sam: Dude, you know when you meet someone and you can’t tell if this person is absolutely a genius or completely idiotic? Or in San Francisco you see somebody walking into a fancy restaurant in a hoodie, wearing one Allbird and one Croc, and you’re like — all right, this person is either homeless or a billionaire. That’s exactly how I feel when I go to websites like this. These are either the biggest dummies on earth, or they’re absolute money printers.
Shaan: It’s like going into a video game and talking to a stock NPC that just says “Oh, hey, didn’t see you there, hello” on a loop. Some random stuff that doesn’t make sense — that’s their website.
Sam: So these websites are either absolute money printers or it’s someone’s aunt who has a dream and is never gonna make it. I can’t tell. But then I see the key tab: Investor Relations. If you’ve got an Investor Relations tab on your website, like — you know what’s going on. Put in the Bill Clinton clip: “I did not have relations with that woman.” That’s how I feel when I see that Investor Relations tab. I know some sh*t’s going down.
It’s kind of this whole website and brand that reminds me of a fourth-grade classroom — you know those posters where “teamwork” spells out a word? That’s what this whole website looks like. But they make $500-600 million in revenue. Their market cap isn’t great because it’s a lead-gen company — those typically don’t get good multiples. But it’s crazy. They just ignored all the unimportant stuff — like how their public-facing website looks — and only focused on results.
They own sites like insurance.com, insure.com, carinsurance.com, cardratings.com, moneyrates.com, BankTracker, M1, and modernize home services. And they partner with way more.
Shaan: How did you find QuinStreet?
Sam: Two ways. One — a guy named Jackie Chu tweeted at me a while ago and I saved it. And two — Joe Spicer, my partner on a bunch of stuff. He used to work with them. He owned an ad network and was like, in the early 2000s I worked with them. They used to do University of Phoenix. You would Google “what’s a good online degree” — they owned all these school websites, figured out how to get traffic, figured out how to do SEO. They look unsophisticated but they are not. They’re like the fat guy who trains jiu-jitsu. You look at him and you’re like, “Oh, this guy?” And then he puts you in a headlock in three seconds.
Shaan: That’s a really great source for info too — people at ad networks. They see everything. They know who’s making money and who’s not, who’s getting traffic and who’s not. If you ever wanted to figure out your next gig, go be an account rep at a mobile ad network or at AWS, and just mine the list of high-value clients. Figure out who’s doing well and who to copy.
Sam: Like going to a barbershop and saying, “I’ll take the number 12.”
Business #3: AJ Patel / High Key & Zesty Paws [00:37:00]
Sam: All right, the next one is in your world — not just because he’s Indian, but because he’s an e-commerce guy.
Shaan: Indian entrepreneurs, you guys are taking over the world.
Sam: So I was looking at the Inc. 5000 list. Of all the lists, that’s the only one that kind of matters — though you can still game it.
Shaan: I see this all the time. Some digital agency that does nothing special, and they’re like, “We’re a three-time Inc. 5000 winner.”
Sam: So I clicked the link for the 2022 list. BlockFi is number one — and BlockFi basically just went out of business three months ago. That tells me everything I need to know. They had already written the story. Someone who works there must have said, “Hey, we gotta remove BlockFi from number one.” And someone’s like, “Seems like a lot of work.” So they left it.
Anyway, I saw someone who’s number five or six on the list. It’s called High Key — it’s like a keto cookie business. The guy’s last name is Patel. I was like, wait, I think that’s AJ Patel. And they grew by 41,000 percent — which just means 41x.
By the way, have you ever heard this word — fugazi?
Shaan: Yeah, it just means fake, right?
Sam: I’m all about this word. I feel like I can own this corner — I don’t know anyone else who says it. It’s an absolute pleasure to say. It’s the most popular line in Wolf of Wall Street — “It’s all fugazi.”
So this guy AJ Patel — he’s probably in his late 30s, like 35 or 36. In 2012, 2013, 2014, he started a vitamin brand and it only did okay. Then he started tinkering with a skincare brand, which actually did much better — it got to about $10 million in revenue. He hired a CEO, the CEO kind of drove it into the ground. So he started focusing on his vitamin brand again, and he’s like: “Look, it’s doing okay — but who’s the best customer of a vitamin company?”
Shaan: Dogs.
Sam: I’m not disparaging him, but — do they work?
Shaan: Why not? Fugazi. They’ll never tell you if it works or doesn’t.
Sam: It’s like those brain-training games. “Neuroscience!” Like having an ad campaign targeting people with amnesia. Does it work? Maybe! Who knows.
So he pivots from regular vitamins to dog vitamins, and he starts growing this thing. It takes off. He gets to $25 million in revenue, sells part of it to a PE company, takes $60 million off the table. Then he grows for another three years and sells it for like $650 million. He still owned half of it. So collectively he made $300-400 million dollars — at the age of 32. And this guy isn’t in Silicon Valley or New York. He’s in Orlando, Florida.
Shaan: Capital of jorts. Short city USA. White New Balance town.
Sam: The 22 listeners in Orlando just collectively looked down at their lap and then nodded like — the facts are the facts, baby. Like you know — Florida is the land of Dog the Bounty Hunter. And this guy, born in India, came over, decided for some reason Florida’s the place, and knocked it out of the park. Not really well known. I was just researching him.
So High Key is now number five or six on the Inc. list, grew 41x. If they were doing half a million in revenue, they’re doing 20 to 40 million now. Another nine-figure-value brand. This guy’s just quietly crushing it.
I watched a talk with him — there’s a website called capitalism.com.
Shaan: Dude, I’m reading the transcript of that talk right now as you speak.
Sam: Let me recap. He’s known mostly for Zesty Paws — he sold that for $600 million. Actually, in the transcript he says the public number is $600 million but it actually got raised a bit higher.
He also has High Key snacks. And in the transcript it says his first kind of side hustle was selling poker chips. He’s like, “I played poker and I got to a million chips” —
Shaan: I did this exact same thing! That’s why this stood out to me.
Sam: You guys are brothers.
Shaan: He got to a million chips and sold them. I did this on PokerStars. I grinded my way to a million chips — that was my actual first million. A million fake poker chips on PokerStars. I sold it for $13 via PayPal. And I proceeded to lose the $13 immediately on the real-money tables. I’ve never felt more like a prostitute in my life. I was like — I worked so hard for three months grinding the free-money game, got to a million chips, sold it for $13, and lost the $13. I even Googled “can I declare bankruptcy just out of embarrassment?” I was so embarrassed by the terrible trade.
Sam: He did the same thing. And he started doing that as like a market on eBay — buying and selling virtual poker chips — and made like $100 or $200 grand. If you’re doing that on eBay, it’s like — here’s all my money, hopefully you’ll figure it out one day.
Shaan: We need this guy on the podcast. I’ve been talking to him on Facebook — I got him. He’s cut from the same cloth.
Also — I started becoming friends with him on Facebook, never talked to him in my life. There was a software I needed to use — I don’t want to out them, but it’s like $10 grand a year. I mentioned to him that I use it. He goes, “Oh, here, I have an annual subscription — here’s my password.” He’s been letting me use his $10,000-a-year subscription for free. This guy is my guy.
Sam: And wait — I just Googled his name, AJ Patel. Here’s a guy who sold a company for over $600 million, sold another company, has High Key snacks on store shelves everywhere across the country. Guess what Google puts up? “Patel AJ MD” — the doctor in San Francisco. No matter what an Indian guy does in business, the doctor is still number one.
Shaan: Jessica Alba’s company, Honest — the guy who started it was Brian Lee. He started LegalZoom and ShoeDazzle too. You Google Brian Lee? Wrestler. Looks like the Undertaker or Big Show. Like, it doesn’t matter if you’re a billionaire — you can’t beat a wrestler in the search results.
Sam: Fame is always way better than money. Wrestling beats being a billionaire.
So in his talk, he said something amazing. He hired the CEO to run the skincare brand, and the interviewer goes, “Was it a sad day when you fired him?” And AJ goes — “No, it was awesome. Firing him was so easy because he was so bad, and I felt so great getting rid of all that dead weight. I look at business as a living organism and I have zero emotional attachment if someone doesn’t serve the business. I’m willing to fire myself or anyone else, and I have zero sadness about it.”
Shaan: I call that Korean convenience store owner energy. You know, those pictures from the Rodney King riots — the Korean store owners with shotguns standing on top of their stores.
I was talking to some people I invested in the other day. They told me things weren’t going that well. I was like, can you do me a favor — screen share, let me see your calendar. It was totally open. Hadn’t booked a lot of anything. I’m like, “From 8 AM to 8 PM you have to have sales calls set up with prospective customers. Don’t give me this nonsense about ‘morning meditation, afternoon walk.’”
You need to have that Korean store owner energy where it’s like: if you don’t make this work, you don’t feed your family. Starvation with a side of deportation — that’s how the dish needs to be served sometimes. Of course, once things are going well, you graduate to thinking about scale and all that. But early on — call yourself a startup, call yourself whatever — you’re just a convenience store owner. And some convenience stores have every kind of Clif Bar and Kind Bar you could ever imagine, they know your name, they’re willing to call you for the usual. That’s what a lot of startup founders need.
Sam: I love this. And I feel like I know so many people where I meet with them and I’m like, let’s just fast-forward to the part where you write a Medium article called “My Next Chapter.” Then you’re gonna sign off saying “Onwards” — like you’re a captain of a ship in the 1700s. Ahoy, matey, your business is failing. Wake up.
Don’t lose and then go work at Facebook and write “My Next Chapter, so excited to lead digital ad products at Facebook for the next two years before I go out and do the same stupid thing again.” Wake up. Go figure something out that’s actually going to work.
Shaan: I invest in startups and I know the name of the game — you’re going to lose most of your money and only a few investments return everything. But when I hear their updates and they’re not even swinging, I reply and say: you’re losing, here’s why, here’s how you need to improve. I gave you my hard-earned money so you could take a good swing. You’re not taking it.
I told some of my other angel investor friends and they’re like, “I kind of feel that way but I’d never say it.” Why not? It doesn’t matter how little or how much you invested — you gave your money to someone to take a swing. Step to the plate and swing.
We have a phrase I use in all my companies: there are two types of mistakes. An error of action — you tried something and it didn’t work, or had a bad result, but you were genuinely trying hard. That’s a fumble, no problem. Then there’s an error of inaction — your mistake was that you didn’t do something, didn’t think about something, didn’t anticipate or plan. You just forgot to do something. That’s the unforgivable one.
So I’m always quick to say, “Bro, no problem — this was an error of action, that’s how you get better.” But for an error of inaction? I have a problem.
I did it twice — rolled up my sleeves, helped them with their strategy, their pivot, their investor deck to raise money because they were running out. And in both cases, my several days of full-time effort resulted in nothing. Not only were they not aware of the problem, they were in denial. Complete waste of time. Now I’m a little pickier — I test the waters. If given a dose of reality, does this person say “more please” or “I don’t want this”? If they don’t want reality, I don’t want to help. Wrong check written to the wrong person.
As the great Dr. Phil once said: don’t piss on my back and tell me it’s rain.
Business #4: Stuart & Linda Resnick / Wonderful Company [00:58:00]
Sam: All right, I’ve got one last one. It’s like a Billionaire of the Week, but someone people never talk about — or at least don’t talk about a lot. And he’s got that gap. When I say “he,” it’s actually him and his wife. His wife is actually the more interesting person, but he’s a bit more front-facing. His name is Stuart Resnick. Have you heard of Stuart Resnick?
Shaan: I don’t know the name. I just Googled it and now I know — they do the Wonderful Company?
Sam: Yes. All right, listen to this. His name’s Stuart Resnick, and his wife’s name is Linda. They’re based out of California.
In the 1970s, he started a janitorial business. He eventually hired a few more workers, got contracts with buildings. Once he was in those buildings with the contracts, he expanded to security guards. At one point he had a thousand armed security guards on staff. He grew this janitor business into a security guard business, got some lucrative contracts including at LAX, and ended up selling it. Made a little bit of money.
With that money, he eventually bought the Franklin Mint — which at the time was one of the world’s largest sellers of collectible coins. In the ’60s, ’70s, ’80s, and even into the ’90s — all the Marilyn Monroe coins, the Elvis Presley coins — the Franklin Mint was the one producing a lot of them.
Shaan: You know who owns the Franklin Mint right now?
Sam: No idea.
Shaan: Tai Lopez.
Sam: Is that real?
Shaan: No, that was a joke.
Sam: Good job. From there, he parlayed that into a couple of things. And now his company — it’s called Wonderful Brands — they own a bunch of really interesting brands. They own Landmark Wines, Teleflora (it’s like 1-800-Flowers, a competitor, does about $350 million a year), Wonderful Pistachios — you’ve seen those at the store — and Pom Wonderful.
So basically his wife Linda — this was in the 1980s — she’s like, “I love pomegranates, but there’s no good pomegranate juice. Let’s do this.” She learns about what pomegranates are good for, develops the signature bottle — you know what it looks like, like a double-pomegranate shape. And they also own a company with another wonderful signature bottle: Fiji Water. The square bottle.
At this point, they’re privately owned. They’re one of the largest farm owners in America — almond and pistachio farms. They do $4 billion a year in revenue. In 2018, they were the wealthiest farmers in the country.
Shaan: And they just quietly crush it. The wife Linda — she’s got this southern belle charm. She’s from like Alabama or somewhere. She reminds me of a character from a Faulkner novel, like Forrest Gump. And he’s got a little New York vibe, kind of comes off as cool and hip. But they’re farmers.
Sam: They’re huge farmers. And they’re not just acquiring these brands — they built them. Fiji is a great brand. Wonderful Pistachios is a great brand. They own way more.
Shaan: And I’ve seen talks with them — they’re like 81 or 82 years old and they talk about how they stay close to their customers. And one of them says, “I just read Twitter all day.” And they’re like us. They use Facebook and just skim their page to see which customer complaints are actually good and which are nonsense, and they reply and make changes. Just running their business that way.
Sam: So that’s the Billionaire of the Week — Stuart Resnick and his wife Linda.
Shaan: She looks like the type of person who would give you a kiss on the cheek and then wipe off the lipstick.
Sam: Yeah. I love those women. They always smell so good. Going to the bathroom at a woman like that’s house is just an absolute pleasure. There are so many things you need to know exist, so many scents. You’ll spend 15 minutes just trying to wash your hands because there’s a handkerchief instead of a towel and you’re like — this is amazing.
Shaan: At the end of this you’re going to be an expert on butterscotch candy and fruit punch candies, like those little wrapped ones. What the hell are those?
Sam: I love this brand. And by the way — this Teleflora / 1-800-Flowers thing. Why doesn’t somebody create a flower thing on DoorDash and Uber Eats? Like why isn’t this? Does that even exist?
Shaan: I think you could create something — either Edible Arrangements style or a flower thing — and just partner with local florists to fulfill the demand. It’s like way better than food.
Sam: Whenever there’s a birthday, that’s my go-to now — DoorDash them something. I can procrastinate until 30 minutes before the birthday is over, push this button, and still be a great friend. The last one I did was a bunch of boba teas because this person really likes boba. Or I’ll send pizza and wings, or a Cinnabon, or a bunch of ice cream.
Shaan: On your birthday, Noah Kagan gifted me like $200 worth of 16-ounce bottles of Topo Chico from Costco. That was it. It was like a month and a half supply. All I drank for two and a half months. Awesome.
Sam: On your birthday I tried to see if there’s such a thing as a gas station gift card — but it was really tough to find something that would work.
Shaan: Can I open a tab in my friend’s name at your gas station? You guys still have the dip? Can you cook my friend some nacho cheese if he brings his own cup?
Outro [01:11:00]
Shaan: That’s the episode. You really did carry it. This entire episode is going to be called “The Sam Parr Special” — just Sam bringing hit after hit after hit. You want to know what I’m most proud about? Guess how long it took me to prepare.
Sam: I think you’d be proud if you spent a long time — like 45 minutes.
Shaan: It’s 1 PM now. We started recording at noon. I block off 11 to noon as my research time. I did all of this in that one hour — and I even took a bathroom break and definitely did some pull-ups.
Sam: Did you take the Limitless pill? How did you do all that in 45 minutes?
Shaan: I just got a good brain. I don’t know. I was on fire today. I drank a bunch of coffee.
Sam: Nice. But that’s it — we’re out of here.