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 hey i’ve got a white male six foot three he’s got a crowbar and i have and he’s trying to break into this building here’s the address i’ve just given them a description of the suspect a description of the crime and the existence of weapons every single police department in the nation that’s what their dispatch is designed to do and they just described this at his own house practicing crowbar combat i know right yeah i feel like god you look fantastic this is the best this is the best i’ve ever looked if i look in a mirror i’ve never seen this coming back so whatever this camera is doing for me this is just know if you’re watching this i’m uglier than this looks right now so no i’m uglier than this looks i think you kind of look celebrity-ish like you got cool hair a cool beard i think you look i think you look like i think you look cooler than you’ve ever looked thank you that’s how i feel i feel cool and i think i need a tattoo or something i’m just like now i’m trying to triple down on the celebrity status that i i see no i i think you look wonderful um two things first today i want to talk about paid communities a lot but before we get into that the second thing is what i want to tell you last night my wife sarah goes good night sean um because everyone’s been saying that dude they say it in such a mean way was she trolling or was it an accident he’s trolling because someone tweeted like well we think that you are sean and sean do because indian guys typically have high pitched nerdy voice and white guys like you have like low pitched alpha voice it turns out shawn’s the one with the alpha voice and i’m like [ ] so she called me uh thank you oh that’s amazing i hope you guys were doing some great things while she called you sean that was awesome yeah well she burned me good but uh let’s get right in you want to get you want to talk about paid communities i did a lot of research because this interests me right now okay let’s do it okay so paid communities interest me because i came across this thing called tiger21 and this sounds like lame that i’m bringing this up now after selling the company but i’ve been interested in this for for years um do you know what tiger 21 is i’ve heard about it what i know about it it’s kind of like a mastermind peer group thing but it’s for a certain wealth level i don’t know if there’s a i don’t know if there’s an actual cutoff but it’s supposed to be for wealthier and i think it’s mostly older people and uh we have a couple friends who are in it so i i texted one of them today about it so i got a little bit of info but tell me what i missed what do you know about it okay so tiger21 uh google it i don’t know the url maybe maybe just that.com um but basically it’s a peer group where you have to have at least 10 million dollars of investable assets in order to join it’s very expensive it’s 30 000 a year i wouldn’t call it a mastermind because mastermind has a certain connotation but yeah it kind of is that um i logged on to the site i’m not a member but uh i used a friend’s login to check it out and there’s uh at least 850 members according to the what i saw and according to their site so what’s that map 24 million dollars a year in revenue um they have local chapters that meet up uh i guess now digitally and they do things like they share one another’s portfolio and you have to defend your portfolio and so it’s basically rooted in rich people talking about rich people stuff mainly being investing but i think it turns into a little bit of therapy every once in a while like a lot of groups do but what did your buddy say all right so i texted uh our mutual friend keith um and he’s he’s uh he’s a real estate guy he’s been on the pod you can go listen to keith’s episode and keith’s a good dude and he goes i go you’re in tiger 21 right and he goes yes um what’s up and i basically asked him what do you think about it he’s like it’s an interesting group it’s because it’s all about investing preserving wealth it’s mainly for older people and um he goes the typical meeting goes four hours you do like you said a portfolio defense where you talk about what you’re holding and why and other people get interested in it and sometimes there’s speakers um sometimes it’s sometimes an external speaker sometimes it’s somebody from the group who speaks and there’s like a moderator and they also do like events because if you go to the website you can see like they hosted a tiger 21 event at magic johnson’s house and so they’re definitely trying to build this kind of like who’s who network this sort of like soho club soho house vibe uh to the whole thing and it uh yeah so they do that they also you get like deals so a friend of mine sent me a deal where they basically when you’re wealthy you get this thing called umbrella insurance which you paid two grand a year and it’s just like general insurance and it’s basically the story they tell you is like if you get in a car crash and someone googles you they’re going to see you’re rich and they’re going to want to sue you for 5 million and this protects against all types of stuff and so they give you a discount on umbrella insurance um and so by my calculation i actually would bet they do 30 to 40 million in revenue and they recently sold to private equity and so it’s a relatively big business and i actually read about uh read up on it and someone said like there’s 90 retention rate which is pretty amazing i’ve also been following reddit’s fat fire which is a subreddit similar to this and it’s like tripled over the last year so this space has got me incredibly interested but this is just one example of a paid community and so what i wanted to do was go through a few other paid communities that are interesting i want to explain i’m going to try to explain why i think they work and then where the opportunity is for other paid communities can i start can i start with one opportunity which is why isn’t this just a business model for our podcast like why aren’t we starting tiger 21 for people that are you know that have let’s call it a million dollars of investable assets so a million dollars of sort of like liquid net worth that you can go invest into something and uh why aren’t we starting this now this seems like the perfect thing to do for a podcast like this i think that probably there should be something like this i agree if you go to the tiger21 website um you’ll see like you know the type of models that people use on their website is like their ideal customer and it’s like 65 year old white dudes who own insurance companies that are quite wealthy but not young or not like our kind of crew um so i agree i think there’s something there okay fair enough so let’s go into it all right so let’s talk about where should we start i’ve done a bunch of research um how about we talk about by the way sorry sorry interrupt you one more time the thing i just said by the way i think is important uh i said why isn’t that the business model for this podcast i think way too many podcasts try to just do ads and we’ve talked in the past about like super cast which lets you do like a paid a paid kind of super premium version of it for your hardcore fans who pay you nine bucks a month or five bucks a month or whatever and uh you know i started a rolling fund largely off of the audience from this thing that said hey i’ve listened to this guy a bunch i trust him he’s he has a good track record and so now that rolling fund is four million dollars a year that i get to invest into startups that’s more value than all of the ad revenue that we had before um and so i think that more people should figure out business models that are different from the content that they’re creating and so i’m surprised more podcasts don’t have different business models i agree with you but we are working we’re in one of the most lucrative niches there is i mean like if you’re a comedian if you’re um what’s that [ ] called the two women who talk about sex all the time call her daddy yes like that’s a little bit different so how do you make money off that that’s a little bit different and that’s actually what we’re gonna talk about with pay communities so let’s actually [ ] up let’s and i’m going to bring that up so let’s talk about what makes them interesting and what makes them not interesting so to me what makes them interesting is that they can grow pretty quickly so you had a podcast um you do this four million dollar fund now building the audience takes a while but you turned your fun on and you it was four million dollars in a matter of months very quickly so they seem relatively fast to grow they’re really fast if you have an audience but compared to like a software company which would take 10 years i think you definitely could build it in a matter of two or three years second they seem pretty fun to run if the interest of your community is the same interest that you have if you if you if they don’t then it’s definitely not as fun but it’s kind of interesting if you’re very interesting if that’s what you care about third you don’t really need a lot of money to start one you kind of actually need no money you really could just start with a paid facebook group and you could have a really lean team to do it and finally they definitely seem pretty profitable because you can have a lean team but let’s talk about the cons one and this is what i’ve learned with our paid stuff and from friends i think churn could be pretty high did you notice that churn was high in any paid communities you’ve been part of honestly the churn was not high in the paid community that i ran um i don’t measure the year yeah yeah for sure but i was it was a monthly it was a monthly fee so you could churn out monthly right for trends i think you charge annually so you don’t know your churn until you know sort of later unless somebody actively cancels so it’s not like uh like enterprise software return where it’s like a net like a 100 negative yeah so that that i don’t think that exists in most communities by the way my my paid community just for real numbers mine was seven percent a month was churning which is like if you just if you’re not adding any new members you know that doesn’t take long for it to go to zero but i think seven percent is one year no i’m talking about monthly i was monthly i was churning seven percent and so uh so oh you’re saying one year for it to go to zero yes i think if you have a i think if you have a four percent churn that’s 18 months and and so when with including my growth i think my net churn was like one percent so i think i was adding six percent and i was losing seven percent basically every month and um can you share anything about trends what was the retention like yeah um so we had some payment issues when we first launched so basically we had some issues um where if someone signs up on day one and on day 366 they get a renewal um the credit card statements there a lot of the banks will be like whoa whoa whoa what’s this that’s fraud so we actually had a big fraud a problem with banks blocking it but 80 of people uh were opted in to uh renew in the year one or in renew in year two in our first cohort um ballpark ballpark about 80 which is pretty good but not but like it’s hard to get new customers on a consistent basis yep um okay so uh the second thing is a lot of times they don’t scale that well and the reason they don’t scale that well is if your community is kind of like trends where you value close-knit connections or tiger 21 more people makes it actually worse now if your community is content based which we’re going to talk about in a second it can actually make it way better but a lot of communities like a ypo like or um like if there’s 150 people at your meeting versus five people at your meeting one is worse than the other the scale gets worse for two reasons one is exclusivity so if the reason to be in this group was that it’s exclusive the more people in the less exclusive it is or the if the value is that oh i really like this conversation this conversation was really really nice but now you get a noisy room of a thousand people well now it’s just too noisy i can’t keep up with this i don’t know who these people are some of these people are saying stupid things i’m out of here right so that’s the two reasons that the scale scalability hurts yes and it can work though because if you’re a reddit which is a community not a paid community but it’s a good community um you want more you need more you need way way more people if you are um quora you need way more people if you’re some of the other examples that you need you need way more more people is good and that’s great um but it’s not always good to add more so what i want to talk about is a few communities that i found that i think are interesting and then i want to talk about opportunities in the space and then finally we can talk about what i think you need to build a successful community um so the first one that i discovered and i’ve actually brought up here a ton it’s called aventa have you seen aventa no okay so eventa i know the first example is gonna it’s like doesn’t even entirely apply because i think aventa is actually a free but you need to apply and eat or get invited so it’s somewhat similar but eventa is a community is a professional group um i believe it has uh 18 000 participating members and it’s for executives particularly uh are you on the website right now no i’m on our our notes okay uh basically it’s for fortune 500 or fortune 100 people um it’s people like the i don’t even like because i’ve never worked at a company i don’t even understand all these roles but like a cio was that a chief information officer so uh i said c-s-o i’m looking at their website um c-i-s-o i don’t even i don’t know what c-i-s-o means it was that chief information security officer yeah cso yeah so these are like things that i don’t even oh i guess they have cfo i know that is cheap uh financial officer so it’s basically executive you just turned into a glossary section for sam to figure out well you know what the role phro is yeah that’s basically your hr chief hr officer basically okay i guess that one was easy a cdo i don’t know that one chief data management officer because come on a lot of people aren’t gonna know what this stuff is but it’s a big thing they have 18 000 members and check this out they sold in 2016 for close to 300 million dollars it was 375 million they sold for and it was for 12 times profit which means their profit was 23 million dollars a year and almost all of that profit came from sponsorships and so the way it works is is that uh they would get groups of 10 or 20 people they would host a talk uh like i think it was mostly an online talk that says like how walmart is gonna handle how walmart is gonna promote work remote work and ten people like i’m just gonna guess what’s a fortune 500 so like the cmo of northern i’m looking at now the chief information officer of northern trust i don’t know what that is but it sounds like a huge company uh the cio of um delta of chevron of nestle is going to go which is like it’s only 10 people at that talk but it’s 10 people who each control 20 000 people and sponsors will pay stupid amounts of money hundreds of thousands of dollars to reach these people enough that it makes 25 million dollars a year in profit uh very interesting an interesting community again like tiger 21 if you go to the website it just kind of looks like pretty old school mostly older white so who knows if it’s if it’s hip or at least like in the know of everything but where’s that where’s this land with you interesting uh it’s interesting but i think you know if i’m most people i’m like okay the hard part of this is going and getting the cio of nestle or the cmo of delta to join some group how do you do that and i remember what’s the name of the the mastermind group that’s the more popular company not tiger 21 but like the other one we’ve both studied i can’t remember the name ipo young presidential organization no no the the one that does like a hundred million dollars a year uh it’s a competitive ypo yeah oh uh yeah yeah yeah yeah yeah what’s that i don’t remember what that’s called uh except for the c i think it slips my name is what is this as well anyways so vistage uh does the same thing as this and i remember getting phone calls saying uh from some you know pick up some random number and it was hey sean you know this is wendy from vistage uh okay have we have we met um yeah actually i’ve heard a lot about you um you’re the ceo of monkey inferno right yeah that’s right uh again like where do we meet no no see i’m i’m actually the chapter president for san francisco for vistage and um i actually want to invite you to join our ceo network uh we have ceos from this company this company this company and uh we just really think you’d be a great fit for for our ceo group we meet up about once a month in san francisco um it’s a great time blah blah blah okay ceo group you you sound like you know me you’re talking about my city this sounds pretty legit um okay so what are you asking me for yeah so the membership is twenty thousand dollars a year and uh and i was like oh okay this is a sales call [ ] uh like good job you got 45 seconds into the sales call and so this is how them and i don’t know if it was them exactly but it was a company just like them uh was recruiting people was just they were just cold calling c-level people with a script that made you feel like they were calling for you uh based on your city and your company name and your role your job title there and so i think this is what you would have to do is you’d have to be a pretty badass cold caller and you’d have to figure out how to get this thing going with just enough brand names where this sounds legitimate i look i host an event called hustlecon i’ve over the years i’ve probably had 150 speakers um tens of thousands of attendees when i started it i didn’t know any of these people i cold emailed them and there’s a way to play it off that it’s cool to be part of um there’s a way to get customers i think that’s a little bit better than cold calling and now i think cold calling cold emailing like that should exist and you should do that i think there’s a few different ways like having a podcast uh there’s a few interesting ways to do it um but nonetheless i think it’s an interesting community the second one that i want to bring up and i got hold of their deck uh a year ago and i could have invested into it and i skipped it i passed and i think that might have been a mistake but it’s called soul savvy have you heard of soul savvy it’s like a shoe thing yeah it’s pretty interesting it’s a sneaker head lover community something like that yeah so it costs 33 a month and you basically when when i was got their deck it was basically just a slack group that’s all it was and i don’t know if that’s what it is anymore but there’s a lot of kids probably grown people as well who are uh want to get insider tips on when a certain drop of a shoe is and they somehow game the system like it’s what it’s called cook groups so there’s these like groups where they team up and somehow i don’t know anything about the space but they somehow get insider information on when a drop is gonna happen and they and they collaborate and scheme together on how they can get access to these certain shoes now what soul savvy’s doing is they started with shoes it was just a slack group which i think is stupid by the way i think if you’re building one of these on a slack group that’s not the right move but they get they get because they have a group of i think they have 5 000 members now so it’s 160 000 mrr um because they have this contingency of 5 000 like really big shoe fanatics they can probably give them special access to x y and z they can do interviews with special people it’s kind of interesting they raised two million dollars uh recently they say that they’re adding 400 people to what to their waitlist a day i don’t know if that’s true but yeah it’s an interesting it’s an interesting space nonetheless what do you think of that uh i think you did good by passing on it i think it’s a cool business for the person who owns it it’s definitely not a as constructor right now that i don’t see how that becomes a super large business worth investing in worth why they need two million dollars and how they’re going to turn that into you know a 200 million plus company i don’t really see that because like we said communities themselves this you know these chat groups don’t scale and um you know you’re looking for diehards who are going to pay if you’re paying 33 a month right like you know that’s more than it’s like you’re providing more value than amazon prime you know what i mean like that’s double that’s triple the price of amazon prime and so you know you really have your yeah the hardcores are going to go for it but also the more people you let in the more people who all have access to the same information the same tips the same drops that they’re trying to go buy the harder it gets for you to actually go buy anything that’s valuable so i don’t really see how this becomes a big big venture scale business but i think it’s a great idea for somebody who’s a big shoe fanatic to create a community like this i think that’s an awesome lifestyle business to to own and uh like if that’s your thing that’s great i love it i agree with you um so let’s talk about three i can can i give you can i give you two characteristics i think make it one is high passion um and then the second one is the ability to make money on the other side so this happens a lot with stock trading groups so um there are a bunch of stock tip groups out there where people are looking for additional information and they want to be in a group where the crowd is moving a certain direction um you have this for sneaker heads you have this for nfts right now collectibles um so so the key characteristic is it’s not just like i’m a big fan of the you know the golden state warrior so i’m going to join this paid community for them typically that doesn’t work as well as if i join this group i’m going to get tools that are going to help me make more money so it’s a very simple money and money out calculation for people and i think that’s why it works for sneakerheads and it works for trading cards and it works for crypto but it doesn’t work as well for like you know people who just love gossip girl yes so there’s a few ways i think that if you’re going to build this uh you’ve got to think about the first is the amount of money that your company is going to make is exactly what you said which is it’s directly in proportion to the amount of revenue that the uh attenders member can make back so for example if you are enthusiasts of rc cars um well the equation here is how much revenue the attendee or member is going to make times how many there are so members of people who like rc cars i have no idea i just made that up but there’s probably not that many of them and because it’s like a hobby that you don’t really make any money from you probably cannot charge a lot for it so that like probably won’t be massive that’s not i mean maybe you should do it but that doesn’t mean it’s going to be actually that big so that’s the math that you have to do which is how much revenue is the member going to make and how many of those potential members are there right or or the one like you said with tiger21 so tiger21 is actually like that when you when you go and you hear somebody’s portfolio you’re going to get investment ideas and even a single investment idea a single like improvement to your portfolio if you have over 10 million dollars in investable assets one good idea is going to more than pay for the 30 000 of your membership excluding the friends you’ll make and the deals you’ll do together and that real estate thing you’ll buy together and all that good stuff so excluding all that now on the other hand if you’re looking at something like um the aventa or whatever where it’s like what is the cmo of nestle gonna do when she meets the cmo of delta like they’re not gonna directly get revenue out of it i don’t think that’s why i think it’s like how hard were how hard is it to accumulate this group of people in a room so if it’s really hard to reach these people these are all high value people then it’s the membership is worth the value of the people in the group so if it’s just a bunch of sneaker head buyers each individual member is bringing zero like clout to the table but if it’s cmos of different companies and it’s about how much clout do they need to bring to the table that’s the value not so much how much revenue they’re going to make yes and so let’s talk about three groups that i have that i think this could work for so if you’re going to start a paid community i’m going to start with the bottom one or i actually think it’s the best one but it’s fun i’m on our list nurses we’ve talked about nurses a ton demographic i think nurses are kind of cool for this space for two reasons or three reasons the first work could pay for it maybe i think work would maybe pay for it nurses are typically i’ve spent time around nurses so they’re typically women and they typically are people who feel like downtrodden like they feel like they’re forgotten because they’re not worked overworked underpaid or underappreciated yeah and that so groups that are the um whatever you just said i guess i don’t know how to explain it but groups that are like the us versus them like we don’t have someone speaking for us typically that’s there’s a lot of like i’ve looked when i was researching communities there’s so many successful um women like women discussing x y and z communities this is just like that so i think that they have that uh us versus them mentality and the third reason is there’s a [ ] ton of nurses yeah have you seen this instagram account nurse life rn no how many is it it’s 1.2 million members on instagram it’s run by this guy i think his name is eb or ebby i’m not sure exactly how you say his name and it’s this guy this is black nurse and um private they just went private uh they used to be public and i think you have to like you have to request so that they can make sure that you’re a nurse before they let you in um which again is part one thing that communities do well the you know what’s that quote it’s like i don’t want to be a part of any group that would accept me um you know the better your gate at the front uh the more people will value being in the group and so this is a group and they they just post mostly like nurse memes so it’s like you know if you it’s like being underappreciated or whatever they’ll make a joke out of it or like you know coming home and realizing you still have whatever you know on your shoe and uh it’s just you know relatable memes from the eyes of a nurse so that’s how they like keep their members engaged it’s just meme content that’s a good like inside joke for the community but he partnered with the makers of bala shoes which is the nurse shoe brand that’s coming out that’s trying to be nike for nurses basically it’s nike for for medical footwear and so he got equity in that company and gets paid every month because he is the promotional vehicle for the forbala shoes who wants to like penetrate this community right so um not a paid community as such but it is a private community and on top of that they do this now what would incredible health you know the startup that’s raised i don’t know how much money 25 million dollars from entries and horowitz and all that what would they pay to access 1.2 million nurses that are like engaged and trust this brand and trust this leader of the community they would pay a lot right uh nurse job boards like so so if this guy’s ambitious he could create a job board he could create the next incredible health uh he could take equity in abolish shoes and be a part owner of the shoe brand i think that’s where this goes for for nurses i think that’s a great example of one i think this could crush i think that guy is gonna that guy’s sitting in a gold mine that like if you if you fast forward 10 years and tell me that he turned this 1.2 million person instagram page into a 100 million dollar company i won’t be surprised right if you go and start truck life rrn uh i i think i think that’s what’s gonna happen after this pod truck um the second one this is shocking to me okay google sheets there’s this guy who tweeted at me and he started this thing called sheets con and he had 6 700 people sign up is that i mean i guess that’s shocking because like i know that probably a hundred million people plus use google sheets but and i guess it doesn’t and i guess it also doesn’t track me because i am a google sheets nerd and like i’ve dorked out about what i want and some of the most uh profitable online courses in the world are become an excel master how to use excel become better at excel those are like if you’ll go look at the charts of uh most profitable online courses highest revenue online courses excel is always in the sort of top five yeah encore the founder of um teachable teachable one time told me that uh there was some guy making a million bucks a year and he was like the biggest earner on teachable on excel exactly so google sheets i 100 think you could do a paid community now it would have to be cheap though because it’s the same it’s the math of like how much money do you make for google sheets i think that there’s absolutely something there um and then the last thing is this someone tweeted at me a community of vetted senior engineers who talk about advance advanced engineering concepts like how to scale a tech stack from 100k to 10 million users totally buy into that something like that that is incredibly niche and incredibly high-end where if there’s a there’s this other component that we didn’t talk about with the community is you have to make it so that information that you gather in that group you cannot find online like um for not that many people are going to talk about how like because it’s embarrassing how do i gift my child 15 million dollars without the government getting hands on it like that’s not something you’re going to tweet because that’s embarrassing same thing with 100 000 to 10 million users there’s just simply not that many people who have done it you’re not going to find a lot of reputable information on that so that’s another trait of these paid communities and why i think this one in particular is interesting i think any job in any any job can do this so nurses is a good one because you have some are going to be better than others because you have uh you know the more people the more potential and the more um kind of like insider knowledge is needed the more um downtrodden that group feels dumbfounded is kind of a negative word but kind of what you’re saying like sort of like they feel that they need to take action um in order to like level up in some way uh the better and so like you know this could work for nurses but it could also work for designers i could see somebody just making a community of you know professional designers at all these different companies it’s like yep we have designers from figma and from hubspot and from octa and from github and you should if you’re a designer at one of these companies you’re making 150 000 a year 200 000 a year um why would you not want to be a part of the like the best network of other designers like you where you can share tools tactics salary information if you’re looking for new jobs opportunities if you’re looking for new jobs like every job i think needs this and the more new infringe your job the more they the more the community is needed so like i know that our friend david spinks did this with community because community was like this there’s not really like there’s no chief community officer at these big companies but all greek companies say it’s all about community facebook’s like it’s all about community twitch is like it’s all about community and uh what does that mean and who in your company show me your who’s in charge of community at your company right and there’s typically not a c level who’s in charge of community so david spinks said well look there’s all these like kind of mid-level people who are they run community for these big ass companies and there’s no playbook on how to do their job they’re underpaid they’re under-appreciated and they’re overworked trying to run all these events i’m gonna make the best community for community professionals and so he made the community for community people it grew pretty large he ended up selling the thing i don’t know how big of a business it was in terms of a business outcome he might have been a little early but i think that’s a great example of somebody doing this just taking a job and making it happen so there’s my idea i just wanted to talk about communities i think they’re actually kind of cool businesses i think a lot of people think that they want to start one but i also think that there’s a lot of mistakes made of like charging too little and i wanted to show a few examples of companies that make like a quarter of a billion dollars of value off communities because i think they’re kind of cool so that’s all i gotta say about communities i’ll leave it with this which is a lot of people i think the majority of people who listen to us they would love a non nine to five way to make ten thousand dollars a month and if i was gonna write or uh i read that in your uh your survey results yeah um yeah which we could talk about that but but in general that’s that’s the number one thing i think people listen to this would would just grab right away they don’t all want to be founders of billion dollar companies or 200 million dollar companies or whatever um but if i said hey this is something outside your nine to five it’s a side hustle it doesn’t take up all your time and it’s gonna bring in ten thousand dollars a month i would say that this to me right now is the number one way to do it i think there are some other ways right you could try e-commerce or drop shipping or something like that you could try to do a newsletter or paid newsletter i would do a community if i was gonna that would be my fastest path to that right now and i’ll tell you you know the reasons why are all the things you said which is like it’s not that much work to run the members provide the value to each other it’s not all about you creating content all the time it’s not that hard to spin up you just have to be smart about which group you’re choosing and what where you kind of have an edge what’s your group and then the last thing the downsides of it are that it can’t scale super large but that’s not your goal anyways you’re just trying to get to ten thousand dollars a month of free free cash flow from your side hustle and so that is super achievable you know uh 20 a month for for 500 members and you’re there you know so i think that is where i think this business fits in and i and i and i said before i actually do think they can scale but not all of them can some of them some some of them can but i i’m someone i’ve built a paid community that makes many many millions of dollars a year in recurring revenue and it is i would say that it’s really hard actually to start because i had to create a lot of the content early on and i had to create the um the culture of the community but now i barely post and it has its own culture so yeah once it’s once it’s taken off yes you you create that flywheel and it works or not by the way i just did this i just did this in e-commerce and it probably i’ve probably put in a grand total of maybe eight hours into this thing and i’ll tell you what it is so i wanted to create a community for people who have e-commerce stores so i created a gate at the front that said your ecommerce store must be doing a hundred thousand dollars a month what’s up it doesn’t even have a website there’s no website um it’s called club ltv ltv is like an inside term in the ecom world lifetime value it’s like whatever e-com store owner wants is their their ltv to go up so i called it club ltv it’s for people trying to increase their ltv and so i said you have to have a hundred thousand dollars a month of revenue i told so i tweeted it out so i definitely had a head start because i have an audience so that brought in about the first 35 members you said yep and they would just send me a screenshot of their dashboard yep here’s me this much okay so so what i did was i made it free to join for the uh the store owners but you had to have this much value like this much you had to be this kind of far ahead in the game um but what i did then was i went to sponsors and i basically said hey i have a group of 75 store owners ranging from 1 million to 50 million dollars a year in revenue and all of trust me like me and i meet up with them once a month and um would you like to sponsor this so i have one sponsor on board they paid me 5 000 a month um all i do is at the event i say boom i do my intro my high energy intro and then i say hey let me pass it to the guy that makes this possible that makes this group possible and he says his thing for two minutes he’s had uh i can’t say the names but um i don’t know if i should i guess i just gave him a free plug so mercury bank is the sponsor of it because that’s who i would use for e-commerce projects and they’re they have a big push in e-commerce and so they’ve had at least from our group five different five out of the 75 e-commerce stores switched to mercury just from the sponsorship so they’ve gotten their money’s worth out of it including one companies that’s a two billion dollar company has switched over to them and so uh you know they definitely got their value out of the sponsorship but and is this still going yeah this goes every month and so all that we do we have we have about one hour a month of of prep and then 90 minutes a month of the actual event and the the one hour of prep is that ben goes and gets a cameo made from a different rapper every month and the rapper’s just shouting out club ltv he’s like so we had like you know um we had uh sean paul do the cameo one month and he’s like hey it’s your boy sean paul just one of them like big big ups to club ltv you guys are all doing so great with your ecommerce store and he’s like you know just it doesn’t even make any sense but it’s just like a video that plays and people like it because it’s like i don’t know it’s kind of goofy so we do one we get one cameo ordered and he sends the calendar invite so just make sure everybody gets it sends one reminder email and then the last thing is that after the event he just says hey if you learned something really useful that you’re going to implement in your business um email me the one line of the most useful thing that happened for you in the hour because the structure of it is we break everybody up into groups of six so you’re in a group with six other store owners who do between 1 and 50 million a year in revenue and then the format is you say one thing you did in the last month that’s really working it’s driving revenue up and one thing that you’re struggling with that you might want help from from the group and so afterwards they all email him the most useful things he just comp he just takes he just takes that sheet and he just sends it to everybody so hey here was the top insights from the group so that whole thing takes in one hour what’s that why wouldn’t you charge for that because i can actually make much more off the sponsorships for example i’ve been approached by you know the companies that want you to build their e-com store on their platform there’s the people who want you to use them for email marketing there’s the people who want for influencer marketing who are you using for facebook advertising who are using what’s the agency that manages your your um your data tracking like your pixel stuff so all these companies each are willing to pay multiple thousands of dollars i just have to onboard them now um because now i have the group and the group is where the value is that’s the honeypot it’s the same thing you were talking about where eventa they have a free group and they might they have they are making 25 million dollars a year on the sponsors who want to talk more than that oh sorry that’s the profit they’re making 200 million but um that’s the same model that i’m using here don’t charge the members just make sure all the members have successful businesses and once they think this is going to get or do you care i mean i put zero effort into it since then but like we have 75 people who show up every month to the thing and um which is like 80 85 of the members show up every single month to the event so it’s they’re getting value out of it and so i bet if i told ben hey go on twitter and just reach out to these 250 cold email these 250 or these 500 e-commerce stores because it’s very easy to get lists of e-commerce stores that are successful um i bet we could triple the size of the group if we if we put some effort into it but don’t really care about it it’s more for fun but it’s cool because it’s just free money every month and it’s a good group to be in i want to learn from these people i want to learn what they’re doing what’s working what’s not and make these connections that’s bad apps well you uh you know i it’s funny i’ve i’ve built the community as well but it’s like every time i learn something like you the way you’re doing it is a lot different than the way that we’ve done it and it’s really neat to hear a different point of view and perspective uh on how to get it done right i optimize mine for how do i spend the least time but get just enough value whereas i think for you is like a part of your business you’re like i’m gonna this is gonna be a multi-million dollar thing and we’re gonna make it [ ] awesome which is awesome by the way if i had to start over i would have done it differently um i would have charged way more money um because i’ve learned the mistakes that you have to add a ton of people to build a big business and a ton of people for certain groups isn’t necessarily good right um fair play all right one more quick one before we go uh only if it’s you because that’s all i prepared okay um okay i kind of have like a like a advice thing this is my psa this is my public service announcement um do you know what the word inertia means yeah it’s like uh uh when something starts moving it’s hard to quit moving yeah so i’ve noticed this and you tell me if you’ve if this has happened in your life but i’ve noticed for myself and many people that kind of asked me for advice inertia explains like 90 of why people are doing what they’re doing right they’re doing what they’re doing because they’re already doing it and sometimes that’s good because like hey the train’s in motion so i kept going even when things weren’t you know going gangbusters but i just kept going because it was it was already in progress and i’m glad i did because i had this good outcome but more often than not whether it’s your business your relationship with somebody um maybe it’s something you’ve invested in and why are you invested in it well i already own it i don’t want to sell it okay but if i gave you that money today would you buy it no so it’s like you know there’s all these weird things if if i didn’t if you weren’t already doing this business if i gave you a clean slate tomorrow would you go start this business again no then why the hell are you doing it right and so in my life i’ve had this kind of like weird moment many times where i realized [ ] inertia is a [ ] and inertia is the reason i’m doing all these things i’m doing not because i actually want to be doing them or think that it’s the right thing to do right now and so i just wanted to say this for to say see if this has ever applied to you um but b for anybody out there who’s listening to this and like something is not going the way they want in their life coach like just check yourself like is this am i doing these things because i really think they’re the right thing to do and i want to do them or am i doing them because this is just the way that things were already going and i i don’t have the courage to change it i remember with my company when we sold our company it’s because i had a conversation with my buddy silly and i you know while we were talking we were trying to figure out okay how do we make this bigger how do we make this grow and we were both looked at and we were like i don’t think there’s like we don’t have great ideas like left we’ve tried so many things we’ve white boarded all these different ideas it’s like do we even believe that this is a big opportunity like knowing everything we know now would i be still doing this opportunity if i wasn’t already doing it and the answer was hell no and it was so this was my test it’s if this project ended tomorrow for whatever reason the company had to fold would i wake up tomorrow and start working on the same project and the second question was if the company had to dissolve the investor you know the company went bankrupt and i needed to go start again would i call these same people like hey you want to work together on the next thing because if i if no then i have the wrong people today if yes then i have the right people today if i would call them again and so for me it was always the people were but the project was wrong and that’s when i decided look maybe i should sell this instead of keep going on this for another five years and um you know just sort of keep going with the inertia so has this been a thing for you in your life yeah and i’ll tell you how i combat it and i think i’m actually really good at combating this i think i’m i’m not great at a lot of stuff but i’m good at combating this and warren buffett says it’s like uh bailing out water of a leaky ship he’s like it’s sometimes it’s better just to get a new boat and the way that i get out of this is i do two things the first is i burn bridges so a lot of people say don’t burn bridges i say no i actually do burn bridges so quit your job or move to another city or do something drastic because for me i’ve said i cannot focus on more than one thing at a time i can only focus on i can only focus on one thing at a time and so in order to like get to create to break inertia and create new type of momentum i like to create some something that i have my back’s against the wall and i think more people should do that i think that’s the way to go um they say that like once you have a kid you your that changes so that’s one that’s an example once you get fired a lot of things change so i like to create those moments where i have where yes i love those forcing factors and the second thing that i tell that i do and i actually tell people is i say just do something really small so for example if you’re starting a business don’t think about a million dollars what can you do tomorrow that’s just one dollar and creating little tiny things actually helps a lot um because breaking the pattern is quite challenging and i love burning bridges i think that’s the way to go well you gave advice on two things there you said basically you you cut things off and you burn bridges that’s how you stop current momentum and then how and when you start you start with ultra small baby steps or uh and i’ve heard this now for many people so when i went to this tony robbins event he used to say he’s like how many of you like if you think in your life has there ever been a decision that has like altered the direction of your life like obviously yes for all of us our life is full of choices and if we have made different choices we’d be in a different spot right now and so clearly like choice and decisions are like one of the superpowers that we have and he goes but how come there’s times where you know maybe it’s like weight loss you keep saying you want to lose weight you keep deciding to lose the weight you make that new year’s resolution and then you don’t do it right or this and that you know you you say you want to quit your job you want to start your business then there you are nine months later still in your job still with no business and so he says like the word decision we’ve kind of we just used it too freely he goes the word decision the root word of it like decision is like kind of incision which is a cut and he’s like the word decision means to cut off the other possibility when you decide x you remove the possibility for y you cut it off completely and he always says like i forgot that um famous like story or whatever but it’s like you know these people going the general is going they’re trying to surge take over this island so they arrive on boat and they’re trying to try to make it to land and trying to take over the land and he says you know if you want to if you want to win if you want to win the war get you got to burn the boats they say like if the soldiers know there’s no boats there’s no place to retreat there’s no boat to get back on and go back home where you came from they’ll win this island and um so he’s you know the the story i guess i don’t know if there’s real or not but the story is the general burns all the boats and then the soldiers go and they win and same idea so that’s kind of what you’re talking about which is you’re better than most in that when you make the decision you literally cut off the other opera option by physically moving by sending that email by like or cheaper or i make the old option really embarrassing or hard to continue doing so a good example is this is as we speak i have i’m actually going to talk not loud doesn’t hear me i have a chef in my kitchen cooking for and it’s very expensive it’s a very expensive fee and i’m doing it because i’m trying to i got actually really fit the summer time and then i got a little chubby and now i’m gonna get fit again and it cost me a lot of money to have this guy here doing and the reason i’m doing it is because i’m gonna lose weight quickly and eat only the food because right i want to stop doing this and so that works really well another example is if you want to lose weight you sign up for a competition like an ironman or something you can’t get out of something you cannot get out of and those types of forcing functions are the i have found for me personally who’s pretty lazy and stubborn it’s the only thing that works right i’m the same way i want to use psychology against myself i want to use my own psychology against myself so if i say something publicly like we’ve said on this pod we’re going to grow this bot we’re going to make this a top 10 podcast this podcast can be doing 100 000 lists per episode we’ve said that now egg on our face in front of all these people that we think are cool and we want to seem cool against if we don’t make it happen if we don’t if they don’t see us taking the steps and taking this seriously to make it happen so when they see us putting thousands of dollars into our studio adding video adding youtube uh doing more research so we’re coming onto these podcasts more prepared they see that we are taking massive action towards it and we can’t be embarrassed on it tim ferriss used to do this thing where he would say i don’t know if i don’t know how real this was or this was just a thing he used to sell his books but he used to say if i wanted to lose weight i would give my friend a 5 000 check and say donate this to the kkk if i’m not this weight by this date it’s already in the envelope you just have to put it in the mailbox and that he doesn’t want to lose the money he doesn’t want it to go to the kkk he thought of the worst possible outcome for himself that would give give use his own psychology in his favor to serve him in this case yeah there’s a business around that it’s called stick s-t-i-c-k-k or it’s spelled like with two k’s or something it’s like a cute spelling and you have a referee of a challenge that you want to do you fund the account with a certain amount of money you pick something you hate and the referee deans if you hit it or not and then that money goes to your anti charity right yeah i i think that’s a cool idea i think there’s even more people can do to like use use our own psychology to get us to do the thing we really want to do in our life and of course you know like these things are kind of external motivators they’re not great you know what you would rather do is you know build great habits and you would rather be internally motivated and make a decision for yourself that this is this is like a must for you you’re going to do it it’s not a should um but but you know some of these these tools can help you get leverage and i’ll actually leave it with that what what changed what are you talking about can you say or no uh for what do you mean why did i bring this up yeah i was talking to a friend and i just realized like i can help this friend the friend just needs to make a change and then the rig realization was that the friend didn’t even want to be doing what they were doing anyways they were just doing it because of inertia and i looked at my own life and i saw all these different examples of where inertia had inertia was inertia had the drivers you know had the wheel and um inertia should not even be in the passenger seat a nurse should be in the trunk and it’s just something you carry with you at the mo at the most and so i just felt like i need to say this in case there’s somebody out there listening for whom this happens because when my friend was in that situation i explained it and they were like dude thank you like i needed to hear that because it made it more clear and now i’m kind of embarrassed that i’ll just keep doing this just because of inertia like no that’s not a good enough reason for me i’m gonna actually choose the things i do and then for better whatever they turn out at least i chose that path rather than like autopilot sleeping i think there’s a lot of people listening that might say like and i think you agree with me and like taking drastic changes i think there’s a lot of people listening who are like well that’s pretty reckless um and my answer to that yeah if you want like a drastic outcome you have to take a jurassic period yeah or or like be honest what is the real risk the real risk in almost all of life is mediocrity you know like my my trainer tells me this all the time he goes most people are so afraid of so many things it’s like there’s a lion sitting in the room he’s like and i’ll be the first to tell you look if there’s a lion in the room don’t meditate don’t uh don’t take deep breaths run if there’s a lion run sure he goes but most of the time there’s no lion in the room and basically what he’s saying is like the things that we the things that we want to do we should have the courage to do the reason we don’t do them is fear and um and one other you know like we should not be fearful all the time because most of the time there’s no line in the room most of the time the risk is much lower than you think for the things you’re hesitating on and the the real risk over the long term is mediocrity is having a mediocre life a life that’s not on your terms that isn’t the way you want and so um you know i think that’s true and i think you can apply this to anybody like abraham if you if if i if i say this to you now or as you’ve been listening to the separate you is there a part of your life that you you think is like that’s inertia that’s inertia driving not not me choosing it could be doing this podcast i don’t know how long you’ve been i hope you won’t say that it could be though like because bray has big dreams so brady wants to start a company he wants to do all this and he you know this pro this podcast was a passion for him and it turned into a job for him and i don’t know like is this what he wants to be doing with his time or does he have a bigger dream and he’s just doing this because he was doing this i don’t know what do you think of bray what do we how what this is a weird episode this was the weirdest episode it kind of became about me but like that the community part felt less like a podcast and like we could charge for that there was so much value in there for the right person i think for a lot of people listening i think that’s it was not as entertaining as the stuff that we normally put out i think but it was more valuable if that makes sense yeah uh i don’t know which one is best so i guess we’ll find out speed at us so we know and just tweeted us like i i don’t know if bray i don’t know if a brave speaks for the average listener we think he does so that’s why we ask him but if you’re like if you’re like yeah i generally agree with the braves grades then tell us and if you don’t agree usually and you’re like don’t listen to that guy also tell us go just go on twitter or email us or something and i don’t blame you because i disagree with myself so oh also i put this out there uh everybody put the link to the hotline in the description of this i want to start doing q and a’s where we take um ideally like somebody asking a question like you talking somebody asked this question we play it we respond to it or we take call-ins or something like that but i mean say i want to do some bonus episodes i opted him into this i don’t even ask him if he wants to but we want to do some bonus episodes i committed to a third episode um so and if it’s a q a that’s like the e that’s that’s required zero work for me so yeah i think it’ll be fun so we’re gonna put a thing in it’s basically a hotline where you can just ask your question to the mfm hotline and we will get those we’ll sort through them we’ll put the good ones into the episode and we’ll answer them so uh do that all right i’m out hey everyone we did an interview with dave sellinger aka selly he’s the founder of deep sentinel really interesting home security company dave is also really interesting himself he’s a multiple time founder really cool guy not only do the guys discuss deep sentinel but they also talk about some of the opportunities dave sees in the moment so we’ll leave this interview here at the end as a little bonus as a little nugget hope you guys enjoy and as always leave us some feedback so we’re going to do a relatively quick statement segment uh dave do you go by david or dave uh go by dave you go by sally most of my my friends and co-workers call me sally sally all right that’s a good one um selly s-e kelly uh i dig it um okay so i invited you to come on because i have this thing called senegal deep senator i say it right deep sentinel yep fentanyl um my friend noah you mispronounced his name you mispronounced his company is your friend’s name really nella yeah i i people make fun of me because i mispronounce a lot of stuff but um i have been using this it’s quite interesting and i want to give a summary of what this is my friend gave it to me basically i had ring these ring cameras and ring pretty good i mean it’s fine it’s cameras but my friend noah was like oh that’s cool you can watch people steal your [ ] um and i was like what do you mean he’s like well i mean what’s the point like you got to monitor all them and i was like yeah that’s actually a great point he goes here try this thing called deep sentidol so i tried it and basically what it is is it’s a it’s a bunch of security cameras around my house and there’s security guards watching it all the time and if something is triggered and uh they see someone at my door that looks suspicious or even just someone at my door they say hey who are you uh do you know the person who lives here what are you what are you doing here um whatever yadda yadda and i tested it online on my twitter handle and i like did the secret sign you could like put your hands above your head and do a sign and someone checks and goes hey is everything okay and it’s just like pretty badass and so i invited you on because i wanted to learn a little bit about this did i describe the company accurately you nailed it right like our our motto really is um and one of our one of our marketing gimmicks is that we make a a t-shirt that says oh you have ring congratulations uh you know now you can watch people steal your [ ] and that’s and that’s literally kind of where no i got that is it i personally have uh i have a ton of cameras i’ve been a camera fanatic for a long time and my neighbor had a home invasion and so you know the the neighborhood it’s a pretty scenario we all freak out and we’re like you know what what can we do we have the police come and i introduce myself i’m kind of the head of the the neighborhood watch and blah blah so i i asked the cop i say you know look my neighbor she has all these cameras she has an alarm system you know why did she still get a home invasion and the cop who i’m now friends with by the way says like the rudest possible thing which is which is straight on point he says well you’re the tech guy what did you think the freaking cameras were going to do and it was like this moment of just utter eye opening wtf was i thinking you’re right like they’re just cameras and they don’t actually stop anything and so i i spent the next five years building a product that turns cameras into something that can stop crimes how many subscribers do you guys have we have uh about 2500 customers across the country about half of them are businesses and half of them are are residential and how many security guards do you have and where are these security guards so we’re we’re bordering on like kind of the the secret sauce here but i’ll tell you we have a ratio of about one guard for every about 100 properties right now and that’s how we make it so that it’s affordable because uh it’s a hundred dollars a month kind of our starting price point and if you think about like having a security guard at your house if you happen to you know have a bunch of friends who are billionaires for example they’re spending thirty to a hundred for a security guard and our our entire point was like that’s just not attainable to most people but security is really really important how do we make it affordable and so we use ai and like a bunch of technology in the middle to make it so that we can have one guard protecting lots of properties at once okay so you don’t have to answer exactly but if i had to guess and i mean you just said it around 25-ish security guards a couple dozen a few dozen some some number in that ballpark yep um and how can this how well the question that i had when i was thinking about this business is two things the first is this whole idea of like someone real actually doing manual work is like on the other side of a of a tech a tech product is kind of interesting to me i remember you guys remember when you were younger there was that service called cha-cha and you could like text them a question and they would answer it totally like i think there was a real person on the on the other end who would just google the question you had because google wasn’t on your phone at the time yep that’s exactly what it was and that’s kind of like what you’re doing and so my question is this how do you scale that and you just think of a ton of guards and also what other services can i apply this to so that’s exactly the way that we think about it kind of inside of our four virtual walls of the company um so so number one the the number one thing that we do to scale is that if you think about the the old business of security right like a guy or a gal sitting at a chair watching the entrance to you know a corporate building that is inherently not scalable right you have no levers because you have a physical chair and what’s neat about deep sentinel and the big kind of aha moment for me is that there’s all this internet stuff that can sit between the cameras and the guards when there’s internet stuff that means you can instrument it that means you can you can start measuring things and then like uh what i did at amazon and my last couple companies you once you have data you can start optimizing it you can start looking at what are the real problems what are the things that aren’t problems how do i how do i make the guards into super guards right like in fact at our office we have an iron man at the entrance because that’s that’s the way that we think about this is that our technology turns these you know regular awesome guards into super guards that can instead of having four guards protecting one property you have one guard protecting 100 one guard protecting 200 properties because all of the the the ai filters out events it also sends them clips that it thinks are interesting that they should look at like hey here’s a clip from 30 seconds ago maybe these things are tied together and so as you do more and more of that it’s not like we’re getting rid of the people but we’re making each individual person more powerful right and more engaged in their work um the last thing i’ll toss out about this too is that one of the other things that a lot of people don’t know about guards is let’s take let’s take like the most badass special forces guy in the world right like i’m ripped i’ve been trained for for years and i’m going to put you on night watch so you get to stay up between 10 a.m and 6 a.m and you’re in an area that’s like this dangerous it doesn’t matter how badass you are right like the tendency to fall asleep when there’s nothing happening for eight hours in a row is incredibly high one of the other neat things about what we do is because we spread this across all of our customers there’s always something happening we don’t have like a lull time where our guards are just not doing anything they’re always engaged and so we’re we’re able to keep them awake engaged like you know stimulated in a way that allows us to provide like what you just said you show the the symbol on your cameras and bam within 10 seconds there’s a guard responding you can do that 24 7. okay and so where are the other opportunities like this what do you call this this model i don’t know what you call it where you have like real real people doing stuff yeah so um the the kind of like way to still be called a tech company is you make the human the second part so you call it human in the loop that it’s a technology loop and there just happens to be a human for a tiny piece of the work uh versus a traditional services business where the human’s doing everything and so human in the loop it’s being applied right now already in some other industries like cyber security uses it if they detect like what looks like an intrusion or like in the case of ricotta where they don’t detect it until after it’s done and the hackers release it uh you know that you know that was a that was a jab at them but like you know the idea being that the computers can detect things that are kind of anomalous but the human really applies his or her intelligence to figure out the last little bit so it’s also being applied like in in medical telehealth right so you have these experts and you use technology around them to make sure that you take an expert who could only generally be regional historically but now a cancer expert because of video conferencing and you know remote records and things like that can actually have a lot more impact for us what we think about are how do we take this in a security context because we want to stay in security and how do we expand that to a a virtual greeter at a multi-tenant apartment building a skyrise in in new york for example how do we apply that to watching elderly folks at home who may need just a check-in every 15 minutes how do we apply it to hotels where you don’t need to have a guard there 24 7 but you need to check the lobby every 15 minutes and how do we do that at a cost that’s 10 or 100 times less than having a physical guard on location that’s interesting how big is that how big is that market of just checking in on how many doormen are there in new york you know you know it’s it’s a great question actually one of the most interesting things about this market is uh that it’s it’s pretty big right so the alarm side’s about 20 billion dollars and then the guard side’s like 20 to 30 billion dollars but what what deep sentinel hits is like this really kind of weird seem where there hasn’t been a solution at all ever and that price point’s between about 100 bucks a month and 10 000 a month there is nothing and there’s nothing there not because there’s no demand it’s supply side constraint there’s never been anybody that’s been able to create a product that has a price point in that price band and so what we’re finding is that there’s just this huge vein of untapped demand right like a hotel let’s use that example for that my friend happens to own a few hotels and he was telling me it costs him 3 000 a month to have this guard who’s kind of schlocky to be completely honest i don’t know if that’s an appropriate term on your podcast but i’ve never never heard that word am i the only jewish person on here okay so i i’d say so uh uh i don’t know another word for it but but he’s schlocky so he’s he’s kind of sloppy he you know he’s not really going to scare anybody away and he slept to use another speech he slept up to the place that’s right that’s right so he uh he shows up three times a night this is for three thousand dollars a month he shows up three times a night and just walks around the parking lot for about five minutes he gets a total of 15 minutes of security over the course of 10 hours and it’s 3 000 bucks whereas with us we’d be able to provide that service for for maybe a thousand dollars a month and there’d be someone watching 24 7 in case something happened it’s just it’s so massive what the disruption is when you create something where there’s literally just been kind of a vacuous hole and so you know that’s kind of a way of me avoiding the question answering the question but like it’s it’s tens of billions of dollars that’s just untapped there’s buildings that would love to have somebody greeting them in new york that don’t have someone because their cost would be 20 000 bucks a month but if it costs a thousand bucks a month bam they do it in a heartbeat so what does your security person do when they see somebody that is a potential intruder are they calling the cops are they like yelling through the camera hey buddy back away you know i’m a tough guy inside you know what are they doing to actually eliminate the threat so so there’s there’s a bunch of different things that that we do and and you know you mentioned two things on on kind of the ends of the spectrum right and it’s a it’s kind of like an escalation spectrum and so on one end right like hey i see a kid right that’s the really most innocent thing and the kids kind of like poking at the door and so we have a juvenile protocol each of these things are in their own little protocol that we train the guards on and that’s part of what the technology does the technology helps them know the the potentially relevant protocols to engage here and the uh and with the kids you’d say hey hey kiddo i see you’re there do you belong here right and that’s kind of the softest just touch right then there’s an adult that may be looking a little creepy and then we say hello this is deep sentinel security can i help you and that way if it does happen to be a friend or family we’re not insulting them right so sam’s best friend from college that we’ve never seen before shows up and he decides that the right thing to do is go right up to the door and start looking through the windows without knocking you know that’s the greeting he’s going to get he’s going to know somebody’s there but he’s he’s not going to necessarily feel insulted right off the bat if if somebody shows up and they’ve got a crowbar it’s sirens on hey stop what you’re doing and and the the we automatically escalate so either that guard or another guard is contacting police all of that’s happening within about 10 seconds and that’s where the neat the other neat thing starts is that because we have somebody watching our calls to police are very different than what they get from like if you have adt or like some some i’ll use the word again some other schlocky kind of home security system adt calls and they say hi uh this is this is becky from adt uh i have a motion alarm in the living room and the police say well is it the homeowner is it a cat is it the wind is it the dog and she says no no this is becky from adt i have no idea i’m just calling you because i thought i’d waste your time hangs up when we call i say hey i’ve got a white male six foot three he’s got a crowbar and i have and he’s trying to break into this building here’s the address to do and they just described this at his own house practicing crowbar combat i know right and that’s why two way out but that’s a that’s a great joke but like that’s why two-way audio is really important because by the way homeowners do do crazy stuff and so sometimes i have like a sledgehammer that i use to like exercise you’ve just described me working out well and we’ll say hey like are you there and you say no no it’s me sam here’s my special code word and then we don’t call the police so when we call police it’s a hundred percent verified our calls are 100 verified and most people don’t know this when alarm companies call the police and ask for dispatch it’s 99 false alarms in fact freakonomics wrote a little piece about this and they’re just like it’s it’s horrendous it’s a waste of police time right and so most police jurisdictions have actually passed laws where they don’t have to respond at all to alarm calls yeah that’s what i was gonna say in san francisco i feel like i can call the police and say hey this guy’s got a gun to my head and they’d be like well you know let’s see if you could if you can resolve that with your hoa before we uh send somebody out there right then you can get his name and call us on monday that’d be great right and so how many crimes have you guys stopped we stop about 15 to 20 crimes a day i mean and that’s crimes means like stealing packages it means everything right drum beats right like it’s just it’s stealing packages it’s attempted break-ins it’s assault why don’t you have a a tick-tock channel that publishes every crime that stopped just the footage of the crime we do it it’s the stopped video channel yeah send everyone to it okay i gotta get what is it called it’s stopped it’s on youtube we’re just starting tick tock we just found tick tock right like i’m old sorry so like i didn’t i didn’t really get tick-tock my kids were on it and they were like look at me dance and we did like the dances but i didn’t really think about it as like hey let’s post these things on there uh people are loving it on tick tock so on youtube what is it it’s stopped what it’s the uh it’s the stopped deep sentinel stopped video series and every single week we produce the the best 5 10 15 20. oh it’s amazing these have thousands of views great good for you some of them have close to a million i think yeah we have a couple that have a million uh and it’s it’s cool like it’s what’s neat about it is it kind of taps into um you know if you’ve ever been the victim of one of these crimes like you you want nothing more than to get back whether you’re getting back at that individual person or just like getting back at the world because it makes you feel powerless and one of the neatest things that you know we actually don’t really publicize that we do as a company um is we we actually reach out to people that have been the victims of of like really heinous crimes and uh you know a lot of times i i reach out personally and say like hey i i i’m not asking you to promote us i’m not asking you to do anything i just want you to know that we’ve created a product that actually can make you feel safe in your own skin safe in your own home again and i’d love to just give it to you for the next six months and uh and it’s the neatest thing like i this morning i happened to drive by there was a there was a home invasion in my hometown um last year and i gave the system to these people that live in pleasanton and uh and i happened to be by their house this morning so i stopped in this morning and the husband answered the door and you know he’s like he’s a like a big tough dude right and he he’s not the type person that you would expect to say like i’m really scared in my home but we all have like our our kids or our family or the moments where we’re not home or or like we’re asleep and it was really neat to hear him just you know i say like this is this has really changed the way that we live and and after something that horrible you know it’s it’s really life-changing so we only have a few minutes left in this segment but what i want to ask you where’s the opportunities based on what you’ve discovered because i think like i’ve actually read i like reading about um companies that got big 20 30 40 years ago and there’s a lot the beginning of adp or adp what’s what’s the security um and a bunch of other like interesting security basically the same company but yeah yeah go ahead uh a bunch of companies that are just like like um the guy who started um you know wonderful brands like he got a lot of his wealth i believe from a security guard company like security guard companies are just kind of interesting to me for some reason it’s kind of weird um in this space with this like human in the loop service in the security space where’s interesting opportunities that i wouldn’t know about because i’m not involved um one of one of the ones that we see a lot of uh is construction recently um and uh the what’s what’s interesting about construction yards is you have these massive amounts of assets with no security like literally no walls most of the time right like sometimes you have chain link fences and and that’s gonna generally in security like speaking outside of like deep sentinel in terms of human in the loop one of the other interesting things that that we’re seeing is like just the movement of stuff seems pretty unsolved right like there are still companies that make a hundred million dollars a year and they have a line of business called cash like in the age of venmo and in the age of paypal and in the age of apple money and facebook money and and every type of virtual currency in the world there’s still people getting paid money to like put their lives in danger to go move pieces of paper around i mean it seems like so absurd i’m reading uh hitchhiker’s guide to the galaxy right now in the first chapter it says like humans are generally miserable because they spend all their time moving green paper around and green paper doesn’t make them happy and and it made me think of like the this this business that like oh my god every every year people are like scared and die because they have to move the paper around how dumb is that right like there has to be something for i mean just i don’t know vapor take a picture of it and vaporize it and then digitize it i don’t know but that one seems like there’s there’s just a a asinine amount of risk and opportunity there so construction is there one more what’s another i mean like most of them are pretty obvious right like car lots oh my god actually car lots are interesting too because one of the things that that people don’t realize is that everyone thinks like oh my god car lots everyone’s going to come and steal a car but that’s kind of a big crime actually the number one thing that we see is people going and breaking into cars at car lots because uh there’s just lots of um catalytic converters there’s lots of stereos and there’s lots of leather and so you know every once in a while there’s somebody like stealing cars off the cartridge but what we see a lot of is just these people going and grabbing the doors actually wait i’ll go with one more meth so meth uh meth is a a horrible thing right um but what meth has led to is like this really weird pattern of mail theft and i call it agricultural mail theft and so one of the things that you’ll see this a little bit on extra like hey i saw this guy like going and checking my door handles or checking my mailbox and then it goes on next door and everyone in the neighborhood for like 15 miles says oh i saw that same gal or guy too and meth has created this entire lifestyle where these people actually go and farm neighborhoods and they’ll go in a cyclical schedule go from this neighborhood tonight to this neighborhood next week in this neighborhood and they literally check every single door every single mailbox as again kind of tending it like they would be tending their plants in agriculture and uh and it’s just really it’s a weird what are they stealing is they’re just stealing mail or they’re still stealing something violated um they’re stealing wallets and and mail that’s typically checked they’re actually pretty careful and when i say agriculture like they’re actually careful so so when they put your mail back it’s very infrequent you see them just throwing it on the ground because that’s that that like ruins their their agricultural area so it’s actually really interesting when you see the video they’re like they open your door and then they’re very careful when they put your mail back because the last thing they want is for somebody to find out and frequently again if you look at next door what you’ll find and this is why is needed everywhere is they’ll go be like oh my god i went back for the last three months and this guy’s been coming every four days and i only happen to notice this one time because he took something too valuable to me and and it’s just this really consistent theme across america that your doors are getting checked your mailbox is getting checked way more than you’re aware of i’ve caught a bunch of people my camera’s being being weird i get an email where it says a guard intervened i’ve caught a few people uh i hate it yeah it’s almost made me freak out more now that i know well i mean i i it the the the good news is that you know you do have a layer of protection the bad news is you now know like for real like if if you had a ring you’re getting 100 alerts a day and so you just didn’t know who’s going to comb through all 100 of those alerts every single day just not it’s not worth it well i appreciate you uh coming on this is super interesting i’ve been a fan of your product so it’s nice to talk to the creator of it uh one of the creators of it um this is pretty badass um well thank you guys yeah i mean as you can tell like i’m super proud of it i’m happy to talk about it any day if you put me on for five hours i’d keep going right like i love it it’s it’s the neatest company i’ve ever had a chance to touch and i’m i’m so proud to be able to touch did you help build ring or did you work at amazon i worked at amazon yeah so i was there way before ring times how long what did you start there uh 2002. holy moly i bet we should have you on another time just ask stories about that too i i have lots of stories there’s lots of people that have great stories about amazon amazon is such a neat company to have watched go from you know when i joined every single uh every single quarter the wall street journal would run a story when does amazon shut down because it just isn’t sustainable what uh number employee were you oh gosh you guys were in the thousands at that point probably like three thousand something like that probably you uh haven’t sold too many shares all of them oh my god but good good wait good news though i sold them in order to start redfin so and i held on to some redfin stock so i did not know that dude you’ve been doing it wait redfin the real estate thing redfin the real estate thing i didn’t know you started that so you’ve done all types of [ ] man i tried to yeah it’s been it’s been really neat i’ve had i’ve been i’ve had a very blessed career um but again like what’s neat about this one is you know redfin’s really really cool we invented interactive mapping but this the number of times i get an email every single week that says you changed my that’s tech companies get criticized for like oh you’re just building toys and frivolous stuff you’re like it’s like you’re literally saving lives uh so you get to do both you got to do fun you know tech with with all kinds of crazy [ ] involved and at the same time you’re saving lives so i like that i’m jealous of my friend james who invested in you guys early on i remember seeing him post about it on facebook and i was like this is a pretty good idea and what i didn’t put i didn’t think about at the time because i was like how are they going to scale this up i thought oh they’re going to do labor arbitrage they’re going to get people the philippines to watch your stuff and uh you know it’ll just be a lower hourly rate you know and the price point will be you know sort of high unachievable for most but what you’re saying is smart which is one guard is going to have 100 houses under monitor most of them most of the time nothing is happening so you don’t need eyeballs on the screen and the ai is going to basically say something’s going on on house 42 42 pops up human eyes decide is this good or bad next swipe to the next and so it’s really it’s actually more than human in the loop it’s in my opinion like these should be called something else this should be called likes you know super services or something like that because it’s taking a example and it’s scaling it like a superhero where it’s like oh what if that security guard could not just watch one house but actually could watch 100 houses now you have a super service that can scale in the way that services typically can’t and so i think that’s even more i know for pitch decks you use hooping a loop and i’ve seen that a bunch but i i think super services i freaking love that dude i’m gonna steal that from you if that’s okay yeah that’s great uh i think this is awesome and now now i’m kicking myself because i’m like oh [ __ ] that this actually if i’d asked one question earlier this would have made sense to me and now it does so thanks for coming on and uh explaining it to us hey thank you and and if you’re still interested we’re raising another round this year so hey uh you know let me know see the only problem is i’m a cheap indian dude who’s like oh the price back then the price then would have been i don’t know what you could raise your first round at maybe 10 million or something like that 20 million i have no idea what it was but uh now i bet like have you you’ve raised an a right uh we’re in the process of raising the a right now so okay actually i’m going to email you i’m going to invest in this company anyways you got to send it to me too look you guys are i’m not taking your spot we can both get in baby can we i mean you’ve raised 24 million dollars um right or 23. we’ve raised we’ve raised a bit we have a we have a really unique investment vehicle that’s open right now so you know if you’re serious uh there there is an opportunity because you know adt and these guys what are the other security companies the big ones i’ve looked into this before but they’re all multi-billion dollar sort of sleeping giant incumbent types that for them to do something like this they either have to buy you or they have to change their dna inside their bodies which is not going to happen so has a 6 billion market cap and wait i’m so confused adt has 5 billion in revenue and a 6 billion market cap is that right if you look at their enterprise value that’s the secret they have a 6 billion dollar market cap because they have 10 billion dollars in debt so they actually have an enterprise value of 15 billion dollars 16 billion okay so there’s some by the way and the other way we could do this is if you happen to have 10 billion dollars i could borrow i could do that too yeah this podcast doesn’t pay that well [Laughter] yeah we uh we missed that one but uh dude send me the information i’m definitely interested if you wanted to talk about it or you’re willing to have either of us that sounds awesome happy to do it it’s funny how such a small thing makes difference i saw the video sam posted and the operator the security guard who spoke back was like clearly not like you my relative in india and i was like oh wait this is actually going to feel totally different to have a human who’s got your back who feels like a trusted american voice there with you right there with you and then like right right now in my neighborhood our front gate we have like a door guy just sitting there all day couldn’t stop anybody if we wanted to um but you know just sort of useless uh you know there’s all these little points of failure whether it’s mail it’s the doorman it’s your personal house it’s my for example for e-commerce or warehouse yeah they spend a lot of money you know just guarding because they have millions of dollars of goods in their warehouse and um and it’s just so inefficient so capital inefficient the way they try to uh secure you know have security for those things nowadays because you have alarms which are just going to be like kind of just a sound you know you’re playing an mp3 to protect you or or you have a human you’ve got you know a club spotify now by the way mp3s are the old ones that’s right for you we’re going to stream we’re going to stream the security to you or you have a guard who’s 99.9 percent of the time gonna do nothing and um and so it just doesn’t make sense right like so finally you know a solution that makes more sense and no i’m not paid to say this it just makes sense to me well i i if i can i’ll tell you one more story one of the things that got me off my butt to do this was uh there was a story of this elephant that escaped a zoo and the video was uh the elephant not not a small animal right like an elephant right and the elephant did not escape the zoo by going around the guard the guard was sitting at the at the gate and and like you know the chairs tilted back the way that you expect the chair to be told guard is totally asleep and a freaking walks right by him and leaves the zoo and you’re just like there has to be something better than this this is ridiculous has there ever been a conversation like in san francisco there’s all these car break-ins like can a city adopt this do you ever do you think a city realistically is going to ever adopt this where you know the cameras are on the street post or you know on the lights and you can guard the whole street of cars that way or no you know we’ve we’ve talked to a couple of cities about it the thing that i don’t like is i don’t like the idea of big brother being part of the government like one of the things i really like from kind of an ethical visit i’m a pretty principled guy i like to think um is that by making this surveillance private and focused on private property and protecting that property in service to that individual you don’t have that like panopticon risk of turning into you know the evil eye and and uh you know we never question who our customer our customer is the person that that pays us and owns this property and that’s a it’s a tried and true like deep principle of you know american liberty that’s fair enough i like that yeah the person who buys it is the one who’s opting in to their own protection basically yeah yeah that’s right my um someone just rang my doorbell and i know that because my i just got a notification on my phone that deep senator is talking to him this is where you’re gonna people are going to be like you didn’t know they rang your doorbell because they rang your doorbell like [Music] i can’t i can’t hear it but i know that uh i could i can see on my phone i just got the notification i love it it it makes me feel so much safer for my i’ve got two little girls and i absolutely love it it’s great i’m digging this i’m i mean i can see my wife in our courtyard this is awesome i’m a fan well thank you guys i love i love getting the opportunity to be here thank you so much for bringing me on and uh you know and and for being a good customer thank you hold on good talking man i feel like i can rule the world i know i could be what i want to i put my all in it like my days off on the road let’s travel never looking back