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 you want to talk about paid newsletters really quick a topic that we’ve discussed a lot yeah let’s do it but this one is particularly interesting um the reason why is we’ve talked about this company a lot agora financial i’ve brought it up to you a ton they spun off a couple of their brands and they tried to do a spack and when they tried to do a spec the company that they were spacking with just like kind of like went down like dropped like significantly so they there was already a publicly traded company that was going to buy a few agora brands the stock went down big time but that’s not that important what’s important is the numbers behind this paid newsletter business so there’s this company called um actually i don’t know what they call this little it’s a subsidiary of gordon of agora i think they call it beacon hill it owns six sorry 12 different newsletter brands collectively those newsletter brands do where did i put the number 550 million dollars in revenue and 200 million dollars in profit and by the way growing some that grew 77 percent over last year is that crazy now i’m going to tell you all some more numbers they have 10 million free subscribers so kind of like the hustle that’s like they’ve got 10 million of that uh this is even wilder they have 550 000 people paying them 600 between one dollar and six hundred dollars for subscribers then they have a quarter of a million people paying them six hundred dollars to five thousand 000 and finally they have a hundred thousand people paying them more than five grand for a product for a paid newsletter and what is in this paid newsletter what’s the what’s here here’s where things get way crazier they have some paid newsletters that cost thirty five thousand dollars now the reason why what gets crazy what gets crazy with this is that they have a hundred and sixty products across twelve brands so what’s that math so each each brand has uh 12 12 or 13 uh products and the products i don’t even understand but basically i understand the business model the business model as they get you to buy a 50 or 49 thing then they get you to buy a 2 000 thing and they’re and so they get you to buy that 49 thing and that 49 thing is like a monthly paid newsletter like it’s not significant right i don’t understand how they get it to work and a large percentage of those 49 people buy the 2 000 thing okay so but i feel like okay so these must be b2b newsletters right no they’re not uh yeah that’s an important part that i left out nearly all of this is around and we’ll link to their deck so they have a whole deck when they they it’s kind of scammy so they it’s a financial and a wellness company which is kind of weird they talk about health and they’re talking about wellness and if you click agora up there sean under my name you’ll see the deck they say that their their target demographic is self-directed investors what’s that mean well i’m gonna tell you if you’re looking at the website it’s just a bunch of old kind of wealthy white people who are probably republican and because the reason i think this is they have ads that say like nancy pelosi is coming for your guns you better invest in these eight stocks like they say like crazy [ ] like that right it’s basically the like motley fool on uh you know steroids right yes uh but i think motley fools ethical these guys aren’t they also sold a book on how to cure diabetes okay i was gonna ask you why do you think they’re unethical and then you answered my question and so it’s all financial news financial financial news related stock picks and it’s just just a crazy story i’ve brought this up tons of time we don’t spend too much time on it but it’s pretty wild to actually see these numbers i actually guessed that this is how big they were now we have proof yeah you’ve been talking about agora as like you know doing hundreds of millions of dollars and you know some people know about them but i would say most people don’t know about this empire and most people i mean this blows away most people’s expectations of you know paid newsletter right like oh you know like i just had a paid newsletter as an individual right i made you know a few hundred thousand dollars total and i thought i was crushing it and these guys are making hundreds of millions of dollars so when you look at this is my honest my honest reaction is dude why couldn’t you have done this with the hustle why what what did they do or what was that why was the hill too hard to climb where you could scale like this because this is huge i don’t think it was too hard to scale i think i could have done it i would say that this business has been around since the 70s right so it’s kicking ass now it didn’t always kick ass if you’re willing to be patient you can do it second of all if you’re willing to put your ethics aside a little bit it actually is quite easy to do it helps so exactly how would you do this you let’s say you want to be these guys or beat these guys what does you know you’re sam you’re probably one of the most well equipped people in the world to do this how would you have gone about it well what you have to do is you’ve got to create multiple brands under one it’s really hard to have one brand and only a couple products make all this money so you’d have to have for us we would have done and we were going to do this but then we got bought and the reason i got bought was a whole different reasons which is basically i wanted to um get a payday like and i wanted to i mean like i was pretty clear about that before like i wanted like it was cool it was it’s awesome i’m gonna stay here but like it was nice to like get a lot of ticket um but if i wanted to be patient and do it for 50 years which i kind of do to be honest um i would have created trends but for subset sub categories and you make the first newsletter the one that people pay for only like 49 or 50 bucks and we send you just a couple things a month and then the second thing is you go to sub categories and you charge thousands of dollars for example if there was a newsletter that dissected media companies i work in the media industry and you told me it was four thousand dollars and i also got access to a community i ain’t gonna complain about it right i mean i’m gonna do it if there’s something for digital streaming and that you know that the five analysts are smart twitch is gonna buy that it’s not that like challenging not that hard right um and so that’s what i would do from multiple industries and the thing that a lot of newsletter writers do which i’ve talked about those plenty of times and i don’t have to talk about too much is they do one of two things one they charge too little and two if they charge too little they don’t have a higher end back back product you need a front end and a back end so you need your cheap thing that gets a lot of people and then you need your paid thing that gets only a few people but it charges it makes a lot of money so you guys at trends is like i don’t know 300 something a year you could have been 49 and then 5 000 would have been a better mix of value if you are if you were optimizing for how do we get this thing as profitable as we can lucrative as you can yeah and had we not gotten bought i would have done that i would actually we were about to change it we were about to make that change and by the way what happens to trends now people still pay for it or it’s free now um they pay for it we might lower the price before we’re either gonna make that the back end or we’re gonna make that the front end but we were to copy this model of a 99 thing and then a 2 000 thing yeah dude when i see companies like this it just makes me want to do it so badly uh because it’s like it just seems so doable now i know that in practice when i and by the way we get we get heat for this sometimes because we’re like dude it’s so easy it’s so simple we’re talking like relatively like building a successful business is hard okay like it’s not just we’re not saying we’re not saying things are easy sometimes we actually do says that word easy really what we mean is simple so like being able to bench 500 pounds that is um um simple like it’s straight forward here’s how you get strong in the bench press you lift a lot and then you eat a ton now that is quite hard to do for five years but that’s that was that’s the steps you take so it’s like simple and so what we’re saying is that this is simple it’s not yeah actually i think weight loss is actually a better example because 500 pounds is a hard thing to bench weight loss is literally simple where it’s like hey you need to eat these you know avoid carbs avoid sugars you need to eat a little bit less less calories than you’re burning and like you should work out regularly do kind of whatever just try to get an hour a day of you know break a sweat if you actually just did those two things and be like hey give it like four to five months six months boom you’re in great shape everybody knows that formula it is actually simple executing it and doing it having the discipline and having the rigor to like actually stick to it hard but it is way easier relatively than becoming a crossfit champion right and so when we’re talking about business the scale is that it’s like it’s hard to create the next facebook that’s really freaking hard uh is it hard to create a paid community well i don’t think most people who try it will do it but it’s relatively way easier than creating the next facebook so for people that out there that get all sensitive when we call something easy it’s not we’re not trying to mislead you like yeah it’s gonna take work most likely it won’t work it’ll take some time but we’re on a scale of one to spacex this is more like a one than it is a spacex and like that’s a that’s a scale for for people to think about i completely agree and um i think like now let’s talk about what makes this hard the first and is that you have to sell your soul a little bit now many people will not be comfortable with this stuff sean is pretty comfortable with it i think i’m comfortable with it but i think i’m a little bit less comfortable with it you have to be a face sometimes you have to be you have to say i’m an expert at x pay me money to for me to tell you my thoughts right second um well no this is off that so guys like james altucher who we’ve had this podcast he was ridiculed for doing this with bitcoin everyone made fun of him he made 60 million dollars doing it but he still got mocked constantly and shockingly most people would actually prefer not to make the money and not get made fun of than they would to make the money and get made fun of well the way i think about it is most people truly will not they’re afraid that they’re going to get them not going to get the money and get mocked and so they’re like [ ] it i won’t do it if you really had a guarantee i think people would happily trade reputation points for bank points yeah and perhaps but that’s some moot point because the fact is is that most people don’t even want to because the first point you said of like they may not get the money at all that is also true and that’s what they’re they’re not going to do that so you have to do that second it’s a treadmill you can’t stop this is a lifetime job so if you’re a content creator you i hired people to do it for me you 100 can do that but you’re gonna you can’t you have to you actually have to do the work for a little while in the anyway so you’re gonna have to work and by the way uh quick question on hiring because people ask me this and i have no idea i’m like why don’t you ask sam he’s the one who did it why are you asking me they’ll be like dude the hustle has had amazing talent like they talk about trung they talk about steph smith they think about some of the people you guys you me i mean right i mean i consider you be part of our crew you me trung steph this guy colby we’ve got yeah we’ve got a bunch of people so the question is where the heck did you find these people so can you give me the 10 seconds on each where’d you find chuang where’d you find steph where’d you find colby where’d you find you know all these people colby was worked at a pr firm where he was doing some copywriting work uh and uh trung uh amen did he just apply to you or you like recognize like oh this guy’s good mutual connection friend of a friend said you should talk to this person uh trung came from eamon troy a mutual friend and investor of the hustle steph uh i found on twitter because i read her blog who else that’s it i just kind of want to know and then when you found these people are you what’s your did you cycle through 30 people who kind of sort of saw before you found the gems when we actually sold to hubspot they were like wow you guys have a lot of churn i’m like yeah but here’s what we do like this is actually quite normal in the editorial industry but you hire a bunch of people and you’ve got a you you either fire or there’s a mutual like all right we tried it it wouldn’t fit um and that happens a lot um yeah and you also when you understand the tone i would say that was also a key right because you were writing it originally and so you yeah and you called the translated the right people you saw the trends community like i was the one actually doing it before every day you were posting in that thing yeah and that sets the culture and attracts like-minded people um i also think that um once you find the winners then you go all in on them so trung is what i call he’s a made man steph a made woman whatever steph wants to do something cool sounds good what do you need uh when other people come to me with an idea negotiate baby trying to time to double it trying to double that number whatever’s number sam gave you time to double it these guys are all doing great um whenever if an outside person or if a non-main person comes with an idea it’s you know why don’t you just show me a little mvp and let’s see what people think right trunk says something it’s all right yes sir right yeah like you’re a proven hitmaker so and then the um the last thing is when we interview them i always ask about the bottom fourth of the resume which is like the college classes and all the things that they take because i want them to like entertain me during the interview so in the same way that you are really good at storytelling you have to have other people that are good storytelling right right i feel like i can rule the world i know i could be what i want to i put my all in it like no travel never looking back