The SIMPLE Way To Earn $1,000/Day As a Beginner in 1 HOUR

I feel like I have waited a long time to have this conversation with you three because in my mind, you three are the Avengers of entrepreneurship on the internet, and for very different reasons. You do very different things. You have very different perspectives. You run very different businesses. But that is why I've been so looking forward to this conversation.

Before we get into some of the technical stuff and really specific topics, I wanted to start with a more broad question. You're all entrepreneurs. You will speak to and educate millions of entrepreneurs on your own channels in your own rights. And the question I wanted to start with is, from a psychology perspective and a mindset perspective, what does it take to be an entrepreneur? And can anyone listening to this right now become an entrepreneur, a successful entrepreneur? I'm going to throw that question across the table first. Can anyone become an entrepreneur?

>> At the basic level, if a kid can go around a neighborhood and say, "Hey, I will mow your lawn or I'll rake your leaves or I'll babysit your kid, uh, in exchange for money." Fundamentally, it's entrepreneurship if we're just taking it at the most basic level. And so, what prevents someone from doing that? Basically, if you can get a job, then you can be a self-employed entrepreneur. And so, I would say that is like my baseline number one from a behaviors perspective. Then you get into, okay, I want to learn about the game of entrepreneurship. And then there, it's basically a lifelong journey of how much leverage can I apply to this, um, at all all pieces of the business because even going around knocking on a door and saying, "Hey, can I be a babysitter?" You have all levels of business, all all functions of the business still exist there. They're just done a lot of times simultaneously and at very low leverage. So you have some level of advertising, you went up, you knocked on a door, you have some sort of presentation that you give in exchange for money, and they agree. Okay, great. We have a selling, you know, component to it. Um, then we have some sort of delivery that's going to happen, which is like I might chug with my human body and then take care of this other human body and make sure they don't die, right? And probably have a couple of other things that I might clean the house while I'm here as a little value add. And then fundamentally, it's like that's a complete, that's a complete cycle of exchange. And then, you know, maybe they leave a review because you start to have a website, but that starts to create leverage and then then you expand from there. But I think fundamentally, at the most basic level, that is entrepreneurship. And then everything else is just more.

>> Cody, >> you can be an entrepreneur if you're willing to tolerate pain. I I think being an entrepreneur is largely a byproduct of three things. One, being how much pain can you tolerate? Two, being how consistently? And three, being can you take the consistent pain that you have and find a way to decrease it, which just means can you learn from the things that you've gone through as an entrepreneur? By and large, it is a hard path because, uh, at the end of the day, you can't blame anybody else, and there's a scoreboard constantly behind you. And so, you know, if you if you have a job, it could be the boss. It could be the other decisions. It could be somebody else's fault. But if if you are the entrepreneur in charge, there's nobody else. And the thing that I love about entrepreneurship, and I think all entrepreneurs love, is you either win or you lose. In a lot of ways, it's a zero-sum game. And it's measured predominantly by, do I grow my profits and and revenue in the way that we set up this the system today? So, yes, I think anybody who is willing to tolerate pain can become an entrepreneur. And I think it's actually okay to have pain in your life, and you should seek it a little bit. Same thing as the gym. We don't go in there and think it's going to feel great to have a workout and have our muscles literally rip apart in order to rebuild. And yet that's what it takes in order to get more fit. And so, um, I think part of the game of entrepreneurship is just like, can we increase pain tolerance over time consistently? And once you do that, then the things that used to be hard today, you'll look back on and you'll sort of chuckle because they will not be hard any longer.

>> So there's various types of pain in my life that I'm not willing to tolerate. And there's other types of pain that I've like volunteered to choose over long periods of time. So I'm trying to understand, and this is just a question to all of you, we'll get into Daniel straight after is >> how do I know what pain is worth tolerating and over a long period of time? Because some pain is not good pain. Some pain is not worth it. How do I know what pain is worth it?

>> Well, I think that's what comes into that third level of, you have to be able to be on a a journey to decrease the pain, which is learn. Like that's what learning means. Like you try something, you touch the stove once, you realize that the stove burns you when you touch it, you don't do it again. If you continue to touch the stove continuously over time, then you haven't really learned. Um, but you know, I mean, there's lots of different types of pain. There's acute pain, which is like you feel it in this moment really, really deeply and intensely. And that in entrepreneurship often is things like, I've completely run out of money. Nobody is going to fix this problem. I'm the last one on the line. And then there's a type of pain that is low-grade pain. So kind of consistent over time. I have to work harder. Every single Friday, there's a, you know, a paycheck that I have to give somebody else. That's sort of consistent pain. And I think in entrepreneurship, we should assume you're always going to have some version of low-grade pain.

>> I had pain when I worked in the call center, and I have pain now. Did you have acute pain when you worked in the call center?

>> It was just drudgery and boredom and low. You are out of alignment. So when you have an origin story, a mission, and a vision, and you feel an alignment between your past, your present, your future, and you feel excited about the future that this is working towards, then the pain becomes meaningful.

>> And what you're looking for is pain that is in alignment with origin, mission, and vision.

>> So meaningful pain.

>> Meaningful pain.

>> What do you think? What do you think about that same question about, can everybody be an entrepreneur? And what does it take from a psychology perspective? I'm I'm asking this question because there's people at home that are going to wonder. They're they're in a job at the moment. They're pondering a lot. They see people like you three who seem like you're a million miles away, >> but you didn't start a million miles away. >> So, what does it take to be successful at the highest level?

>> In the comments of every one of these videos is, "Not everyone can be an entrepreneur. Not everyone wants to be an entrepreneur." Interestingly, uh, the idea of a job is a very recent innovation if you take a long view of history. Uh, jobs really only came into existence around the 1850s, is the idea of a wage. Prior to that, people got paid for tasks, and essentially, you completed a task, you got paid. And all sorts of levels of society, and that gave rise to very entrepreneurial classes of people. Uh, you had to be quite entrepreneurial prior to the 1800s. So it's definitely built into us. Uh, I personally think that the human brain has three kind of levels. The base level is very concerned with survival. It's fight, flight, freeze, freak out. The next level up is just interested in status quo, and it's interested in repeating the past and doing what's safe and just doing what's comfortable. And then there's this other part of us that is a visionary, and it's interested in exchange. It's interested in empathy, strategy, love, compassion, adding value to others, and it's it's a higher mind. It's a higher way of thinking. Unfortunately, what happens in most of society, especially with a lot of um, social media, and especially with the way we were raised through the schooling system, is that we keep get just getting dragged back into the autopilot and the reptile brain, uh, as opposed to being able to have a little bit of time for the visionary. And it's that visionary mind that makes you feel very entrepreneurial. I have seen people who have never had a business. They've never been entrepreneurs, and they get around a group of entrepreneurs, and the buzz and the energy from that group of entrepreneurs becomes contagious, and they start opening up this other part of their mind and they go, "Oh, wait a second. I've got an idea. I could do this." And they start thinking about what's possible. And I've watched people go from, "I could never do this," to, "I could totally do this," in a day.

>> Alex, you wrote something down there. It was when you were talking about, you know, what kind of pain, you know, is there? And I think there's a a classic, um, example of when do I push and when do I pivot? And so, um, pivoting comes from, at least from my perspective, where you have an underlying assumption that your original thesis was based on that has been disproven. So, if I say, hey, I want to start, you know, um, a doggy toothbrushing business.

>> Um, you know, there's an underlying assumption that people are willing to pay for their dogs to get their teeth brushed, right? Um, and within the context of like, I have presented this in a way that follows the normal persuasive, you know, tactics of, uh, you know, this is the benefit, you know, these are the these are the prices that I would need to charge in order to make a profit, etc. If I find out that no one cares about this, then that would be a moment where I would say, I don't think you should push harder. I think you should consider pivoting. The pushing scenarios is typically when your underlying thesis is still is still true. You have not invalidated that, and so you just haven't figured everything out yet. Um, and most of that is where the pain comes in. Um, that that Cody is referencing. Now, I think the third door where it gets really tricky is that there's opportunity cost. And I think this is where most entrepreneurs get trapped. And in some ways, rightfully so, because, you know, it's very, very hard to build a successful restaurant that's local. And if you want to be a trillionaire, it's probably not the way to do it. And so, what happens is you develop skills. You know, developing your first opportunity. You figure out how to do doggy toothbrushing. you find out that people don't actually care as much about brushing their dog's teeth, but they do care about their dog having good breath and being, you know, clean and groomed or whatever. And so like, so you pivot a little bit, and then you're doing this thing, but then you have these big aspirations of being a trillionaire. And you're like, I don't know if I can turn this into being a trillionaire, but I did learn how to market. I did learn how to sell. I did learn how to manage. And then you think, okay, well, should I start an AI startup? You know what I mean? As my next thing, because I did develop all these skills. So now what do I do? Right? And I think a lot of people are in, uh, maybe, you know, one step later entrepreneurs are in this camp where they're like, okay, I didn't understand the world as well. Now I understand different opportunity vehicles have different returns, but also risk associated with them. All of them require pain and work. And so if pain is basically, I can only interpret pain as 1 to 10, and 10 out of 10 restaurant days will still suck as much as 10 out of 10 AI software days. But this one has a billion-dollar payout, and this one has a $2 million payout. Well, if I'm going to suffer either way, I might as well do the thing that gets me the best return, which is good entrepreneurial thinking, but then so is focus and so is longevity. And so then what do you do, right? And so, um, and so I I just thought about that from a pain perspective because you have a lot of times the pain happens from insufficient volume. Like you think that this like this business isn't working, but it's realized it's usually because you're not working enough. Um, and when I say that, I mean doing enough in it. So it's like, hey, I knocked on 20 doors and like no one wants this. It's like, well, obviously with 20 doors, you have no idea if somebody wants it or not. It's like, knock on 2,000, you'll probably get a better idea. And so, but most people like have never had rejection before, and so they think 20 is a sufficient amount. Um, or like, hey, there's no good, there's no good engineers in insert city. It's like, well, how many did you interview? You'd keep talking and eventually it's three, and you're like, okay, well, no, I mean, if you're going to marry somebody, do you think you'd only go on three dates? And then just say, I guess I have to pick from one of these. So, it's probably not a good idea. And so, I think the same idea of insufficient volume is one of the things that can that can create pain, you know, for entrepreneurship. you have opportunity cost of like, okay, well, now there's the green, the grass is green over there. Should I stop what I'm doing now, right? And then you have kind of underlying thesis, which absolutely, if you have your underlying thesis for the business that is disproven, then that's one of those times where it's probably worth pivoting. But for anybody who's listening who's a newer entrepreneur, my my big my ask to you would be, I probably wouldn't start an AI, uh, startup caveat as my first business. And what I mean by that is like, if I as in building an actual tool now, if you want to like implement AI using other people's tools, that's a different thing. But the first business that you start, you're going to be learning the game of business even more than you're learning the business that you're doing. And so then once you learn the game of business, then you start to see again, you start to see more clearly the opportunities that exist.

>> The next step for me in what Alex said was about how do I know which idea is worth pursuing? Alex was saying there that, which I completely agree with, is that the first thing you do is actually teaches you the fundamentals of how business works: team building, marketing, promotions, customers, customer service. But for those people that are sat at home and they have an idea and they're mulling whether that is the idea worth pursuing, is there a framework for knowing if it's a good idea or a bad idea?

>> What we use that comes from private equity. If you want to know if your business is going to make you money or not or investable or not, we use the moat strategy, which is basically M stands for margin. So you want a business that actually makes you money, doesn't just generate revenue. And so a good business typically has at least 15% net margin. So that's the money you put in your pocket, right?

>> So that's profit.

>> Yeah.

>> Yeah.

>> Exactly. And then, uh, the O stands for operations. So operations being, can this thing actually scale over time, or will I really have a job, not a business?

>> And what's the difference there?

>> The difference between the two is, if you have a job, not a business, that might be, for instance, without AI. If my entire business was just me talking continuously to camera and I'm an actor, it's really hard to turn acting into a business, right?

>> You're trading time.

>> Right. You're still an employee. You're just self-employed as opposed to a business owner. And there's a real difference between a CEO and a self-employed person. And then the A stands for advantage, which is, do I have an unfair advantage in my business? I think over time, all arbitrage windows close. So if you don't have some sort of advantage, it's hard to stay in business over a long time. An advantage might be, I have distribution because I have social media, so I can get more eyeballs. I can figure out how to talk to 2,000 people quickly because I can do it via video as opposed to knocking on 20 doors. H or it could be logistics, or it could be, uh, 10 years of experience in an industry. And then the T stands for TAM, total addressable market, which goes back to the doggy teeth issue, which is, you know, is this a real market that enough people are interested in that I can build a business that is big enough for me? And, you know, to Alex's point, I don't think everybody should try to play the trillion or billion-dollar, uh, game. In fact, I think it can be quite miserable to to strive for billions. And so the the total addressable market for your local fruit stand in your community may be a perfect amount of income for you, but let's actually know what amount of income is reasonable for you. And the cool thing about entrepreneurship in like today's age, the data is available everywhere.

>> And so in private equity, you would take this model like that. So you'd go moat, you would I take them, and for each one, I rank them one to 10, and businesses. So margin, operations, advantage, total addressable market. Each one of them, a 10 is perfect, a one is the worst you could have. And businesses that are better than 30 across all four, well, that's a fund it. That's a fundable business model. Businesses that are less than 30 but more than 20, that's a fix it. You've got some problems in the model. And businesses that are less than 20, that's a flee it. this is probably not right for you and a hard business to do.

>> I think it's not just the people who are looking for a new opportunity or people who don't currently have a business. I personally think at the moment, every single person on the planet who has a business should assume that their business is on borrowed time because AI is going to disrupt everything, and in that disruption, everyone has the opportunity to rethink whether they want a different opportunity or whether they want to pivot. It's the perfect time. I look at simple things when I'm thinking about, is it a good opportunity? I think every good business is built upon somebody's case study. So when I look at not just businesses as a thing on their own, I think businesses as a thing on their own have to be taken in consideration with who's the entrepreneur. So your entrep, like something that's a great opportunity for Cody may be just a disaster for me, and like, and likewise.

>> So I'm looking at the background of the entrepreneur. Do you have a case study to leverage? Do you have knowledge? Do you have a network? Do you have resources? Have you got a reputation in something? Because those are the things that we can then leverage. And then I'm just going to have a look at three little things. I'm going to say this idea that you've got going forward. Does this address someone's pain? Right? Is there some sort of problem that this solves? And that we could measure that, right? Because people pay to move a metric. They love to move some sort of a number. So is there a pain that we can measure, and can I take people out of that pain based on my story?

>> The next thing is, does that type of person who I'm going to solve that for, do they have money to spend? Because ultimately, 60% of all the money is in the top 10%. So the top 10% have about 60% of the available disposable income. So groups that tend to have money is business owners, executives, people who've got accumulated wealth. Um, you know, so you're looking at like some sort of indication that you're selling to a group of people who have money. Underneath that top 10%, Amazon's already got them. McDonald's has already got them. Like that's a saturated part of the market. you were looking for that top 10% who've got disposable income. And then the final part is passion. Like, are you passionate about this? And my definition of passion is a willingness to suffer. So it's not, do you get joy from it? Not, are you super happy from it? It's, are you willing to suffer for this? Are you willing to have delayed gratification? Um, would an objective third party who looks at your behavior, who looks at the way that you show up in the world, would they agree that you seem to be willing to push through difficult times in order to have this? So those are some of the conversations I'd have with anyone, and not just people who are starting out, people who have already got a hundred million dollar business.

>> It's like the adult marshmallow test, basically.

>> Yeah, I think Cody had a had a great framework in terms of thinking about this from an investing perspective for the people who are considering starting their first business. I like the pain, passion, profession angle of like, typically it'll be something that comes from a personal pain that you overcame. Whether it's you had an eating disorder, or you have kids who have allergies and you figured out how to pack lunches, or you figured out how to store stuff for twice as long because of some unique thing that that you retrofitted a cooler with, whatever. Some passion, which is just like a hobby that's that's you're deeply interested in. Or it's a profession of something that you already currently do. Like, in a way, this is I think one of the easiest self-entrepreneur, you know, self-employment paths is just going from employed to self-employed doing the same thing that somebody already pays you for. So like, you don't need to worry about like market risk of like, I wonder if accounting is still going to be desired by other people. Like right now, because everyone's so interconnected, like remote work and being able to be fractional, like many people can start kind of mini consulting businesses doing, you know, because a lot of businesses and entrepreneurs are very um, bad at allocating resources, and so they have a lot of quote full-time employees that are working 20% of their effort and still keep, you know, keeping their paycheck. And at the end of the day, like they do enough to keep their job, but not so much that they are nearly at their full discretionary effort. And so all of a sudden you think, okay, well, I could probably do the same work for half the price, and the entrepreneur be willing to pay it, but I could do that same work for half the price for five times the people and make three times as much and do it on my own time. And so that becomes, I think, a great like foray into entrepreneurship. Now, what do you have to learn there? It's like, well, you already have delivery down because you already do the job. You just have to learn how to promote. It's just like, how do you reach out to people and ask them if they want what you have, and then get them to trade you money for it. Um, that like, at least takes half of it out of the equation. Almost all three of those, pain, passion, profession, you already have kind of the back end. Like you have the pain, you figured out the thing. Uh, the passion, you've already spent all this time loving this thing. So you've already done a lot of the the work and research. And so really, you just need to learn the front end, which is like, how do I promote and how do I sell, right? How do I get someone to give me money for it? And then in terms of, um, how much money you make, I think Danny had a great perspective of like, you know, sell the rich, like they're the ones who have the money. And if you, uh, sell to rich people, you get to sell at rich people prices, which is more fun. Um, and so, I mean, I'll give you a simple example. Um, I have a CRO company that that we do conversion rate optimization across our sites in our portfolio. And so if that company works with an e-commerce business and they, you know, add 10% to, you know, topline and goes from 1 million to $1.1 million, they make $100,000 of value. If they work with an e-commerce business that's doing $100 million a year, and they do the same exact work and they add 10%, they add $10 million a year. So it's a hundred hundred times more in terms of value that's being created. And so fundamentally, you have the value to create your ability to negotiate a slice of that pie. How unique that is, as in, for example, I could have plenty of sales guys are like, hey Alex, I could sell millions of dollars of stuff for you. I'm like, yeah, but so could every other salesperson. So you have significantly less, you know, negotiating power, even if you have the negotiating skill, just because many other people can do it, right? And then the third, the the final component is risk, and that's the one that I would multiply everything by, which is how much risk you take on. People often say this idea of selling to the rich, but as you explained it there, what what it actually sounded more like is sell to the person who's going to yield the most returns from your skill.

>> And I I reflect on this because I spent the first half of my career doing social media marketing.

>> I think I said this when we sat down, Cody, that I used to work with fast fashion companies or fashion companies. And the net return for the client, >> of me selling them all dresses was tens of thousands. I then left that business and spent two years working in psychedelics in the biotech industry, where if this was around the game, the meme stock thing, where if they could galvanize people on social media to care about their stock, the upside, the swing was billions of dollars. I was the only employee in this biotech firm that ended up listing on the NASDAQ for $3.2 billion. And so their remuneration to me for the six-month contract was many, many, many, many, many millions.

>> Yeah.

>> Because they they made billions.

>> So for me, they they thought they were ripping me off.

>> Yeah.

>> And and I think about it, funny enough, when you put the same company on different stock markets, >> the the company is worth wildly different. And I think the same about our skills, where think about the stock market where you're trading your skills.

>> I've got a I got a small example of that. Really small example. There was a guy who we worked with who was an occupational health and safety, uh, consultant. And inside the workplace, in a typical office, he would charge a couple grand a day, uh, to go in, and it was about 10 days, so about 20 grand to do an occupational health and safety. And I asked him the question, what is the most dangerous workplace you've ever worked in? And he says, well, there's this type of manufacturing that has lasers, freezing stuff, boiling stuff, lava, you know, the sharks, you know, the whole thing, right? Whatever it is. And not actual sharks, but you get the idea. And I said, do you know how to solve the problems of that workplace? And he says, I absolutely know how to fix those problems. I said, "Why don't you position yourself and why don't you run a campaign that you're one of the best in the world for that, and that you're actually going to just run a campaign around that?" Um, within a year, his day rate had gone to $20,000 a day from $2,000 a day, and a typical engagement had gone up to $400,000.

>> Mainly because he went from, you know, the same skill set, but he applied it to a a much, you know, more valuable environment. Podcasting is somewhat similar, you know, because if I podcast in the UK, the amount of money I get per view from YouTube is half versus if I do the same activity, the same amount of effort, the same amount of hours in the United States, the platforms pay me double for the same amount of views. And I think many of us are like trying to get a pay rise from our boss or whatever, but actually thinking about, are you trading your skills on the highest return market is a great way. We I used to hire writers at my old company, and those writers would be paid, you know, $30, $40, $50,000, whatever it was in the UK. When when I was working in biotech and we were looking for someone that could write about biotech, it was a quarter of a million the salary. It was five times more for the same fundamental skill of writing.

>> I think that I think that a lot of times when you're starting out as a brand new entrepreneur, it's scarier to sell to rich people. You're like, I don't know rich people. I'm not a rich person. I'm going to sell to my friends. That is very normal. That's the people that you have the closest proximity to. But the problem is is that means you have to play the volume game. And the volume game is actually really hard. It's hard to get a lot of people to buy your thing. Incredibly difficult. It's actually much easier to get a few rich people to buy your thing. And so, you know, we had this home inspection company, and I didn't know it at the time, but

>> he was telling me they were having like major cash issues in their business. And, uh, and I could kind of tell because when an entrepreneur is under stress, like you can sort of see it, you know, it's a it's a visual thing, too. And he was about 45 days away from, uh, running out of cash. And when I was sitting down and talking to him, I was trying to understand his business. Home inspection has been around forever. It's a normalized business. This business works. It functions. It has good margins. It's a rollup for private equity. The business model is not the issue. So, what was the issue? The issue was their clients and their pricing. So, he was trying to be the home inspector for everyone at a lower price point. And what does that mean? It means it was actually really hard for him to advertise because he wasn't niching down. He was competing with all of the major players, and he had very little margin because he was competing for people who couldn't afford very much in their home inspection costs. We made one change, which is we just said, in front of his business name and in all of his ads, luxury home inspections, instead of just San, you know, San Diego home inspections or whatever city he was in previously. And that one change increased his margins by 45%, and they saved his business. He didn't do more volume. He didn't hire more people. He didn't get smarter. He didn't get better. He just sold to rich people instead. And because that increased the surface area that he was covering. So each house was like, I don't know, thousands of dollars instead of a couple hundred bucks to inspect, his business was saved forever. And so I I think protecting your profit is so crucial when you start a business. And nobody tells you that because it feels safer to sell things cheaply to people who don't have very much money. But there's that old adage which is, you know, try to work with a $50 client, and they will say, "I need everything under the sun for this $50 I'm going to give you." And then go to a $50,000 client, and they'll say, "Wire sent." And so, you know, >> in the beginning, go for the $50,000.

>> I think when you, um, when you're starting out, you a lot of times you sell out of your own wallet to to Cody's point. So, it's like you have no dollars in your wallet, so you assume everyone else has no dollars in their wallets either.

>> And you're so afraid of getting rejection that you continue to lower the price until you get here. you hear people say yes, but just as like a benchmark for people who are starting out is that like, usually you're appropriately priced when seven out of 10 people are saying no. That's like about the appropriate price. So if you have like, if I, you know, see a business and they're doing 80% close rates, as in like 80% of the people they talk to say yes, they usually have a double or triple in pricing just sitting there. If they're at like 60% close rates, they usually have a one and a half to 2x price increase that's sitting there. If they're at, you know, 40 to 50, they've got a 50% price raise in there. And if they're right at that, you know, 30-ish 35%, then they're usually appropriately priced. And if they're at 20, they just need to learn how to sell better. But and so, but fundamentally, I say this because usually, you know, in the beginning of entrepreneurship, you're so afraid of hearing no. Um, but the reality of it is that you need to be hearing no more than you hear yes to know that you're being appropriately priced. When you look at, uh, this this little pyramid of customer segmentation, you get 1% of people who have 15% of the budget, 9% of people have 45% of the budget, 90% of people combined 40%. Right? So when you actually break that down, you have one person willing to pay $15,000, you have nine people willing to pay $5,000 each, and you have 90 people willing to pay $445 each. So you are almost always better off going, I think the best place for most small businesses to go is that 9%. And the reason is, the top 1% typically shop on pedigree. They want to work with the best businesses out there. They want to win work with the ones who have won awards and the ones that have been around for a long time.

>> Relationships.

>> And and through trusted relationships.

>> The 90% they shop on price. They have a fixed price and they only want to shop on that price. The 9% shop on passion. They want to follow someone who's an interesting, uh, who has an interesting new take on things, who's putting together a group, who's done some education or entertainment around it. So the this 9% I would call that the affluent niche, and that affluent niche is really good place to start.

>> And that 9% are the ones that are closest to moving into the 1%. So you can grow with a client over time, which we saw a lot.

>> You could help get them up to the 1%, and then then they'll take you and introduce you to all the others. What skill that you currently have would get you back to being a hundred million entrepreneur?

>> I think there's two different ways you could do this. One would be promotion. So, are you an incredible salesperson to go direct to a ton of people? The other way is partnerships. And I think you can think of these different ways. Promotion could be B2C often, which is like going direct to consumer. Um, often partnerships is B2B, going to a few big people. Um, I think of partnerships as employment, which is a very fast way often to make money, too. Like Jack might make way more millions with you than he does individually. And so my background, when I didn't have any cash, I didn't know how to go to people directly. I didn't know how to do paid ads. I wasn't sure how to do promotion, which is a volume game that you have to be good at. So I went towards partnerships. I said, I can get to fewer, bigger, faster. I can't get to many fast. And so I think there's like two paths to making money quickly if you don't have any. And and the first path has less risk, but perhaps mid-size returns. And that is, go find the best entrepreneur, founder, business builder you can find who you can still get to on a daily basis in some way, and go work for them. Learn as much as you can, earn as much as you can. As you learn more, ask for more continuously over time. This is how I mean, Cheryl Sandberg is one of the richest people in the world, and she's never had her own business, right? She's only worked for other people, and she's doing just fine. So I think that's the first way, and that would be what I would call partnerships or employment. And then the second way is to go do it yourself, right? Which is high risk, but probably highest reward. And in that instance, you have to go and figure out how to get people to buy your things continuously over over time. But like when I didn't have money in the beginning, um, you know, I had just I'd gotten out of finance. I didn't want to work for somebody else again. I was pretty miserable. I had worked for a billion hours for people in investment banking and asset management. And, um, I had massive golden handcuffs. Like I made a lot of money. And, um, I had no brilliant idea. I didn't have a business idea. I had no idea what to do next, and I'm pretty risk-averse, actually. I was like way too scared to go do do what you guys all did, which is start businesses from scratch. And so instead, I partnered up. I went to another company that needed to raise capital and get a few investments in it. And I went to them and said, I can raise money from a few of these people that I know. If I do that, can I negotiate a little bit of equity in the company? Can I negotiate upside return for the money and dollars that I bring in? And I want to I want to be a partner in the company. And so you don't always have to start your own thing. If you can negotiate with partnerships, I think sometimes you can skip to the front of the line if you're not a great natural salesperson, you know, or marketer. And so you really just need to decide which one. And neither of them are better than any others. They're just better for you.

>> The amount of resources you have access to is a factor of knowledge, network, and reputation. So you're at all times you're trying to build your knowledge. You're trying to build your network. You're trying to build your reputation. Now, a lot of people are worried about the knowledge, but they've probably done interesting things already in their history. They probably, if they looked over the last three, four, five years, they could say, "Actually, I've done all sorts of things, but I've never told anyone about that, right? I've never actually explained to I've never posted on LinkedIn. I've never posted an update telling people what I've done. So, therefore, I've actually got things that could build a reputation, but I've never leveraged that reputation." If you're a young person, especially, network is actually you've got a superpower with network. And I'll tell you why. Because if you go to a private bank that normally banks people with 3 million, but you say, "I want to be an entrepreneur. I want to come to some of your entrepreneur events that you host," they'll bring you along 'cause you're you're an ambitious young person. If you go to a large accounting firm and say, "Do you ever host big events? Could I attend some? Can I jump on a newsletter that lets people know about the events?" They'll invite you along. And I'm talking about like Ernst & Young and KPMG. Every single week, they've got some thing that they're doing in their offices. They've got experts, they've got rich people, they got all that sort of stuff happening there, and they'll invite you along. So, you've got this ability to build your network. You got this ability to leverage, uh, your reputation. I actually don't think that you can make good decisions about the knowledge on your own. I think you need someone who's at the higher level to tell you, this is the skills you should go for. These are the things you should do. So, for example, at the time that Alex did ads, it was a great time for doing ads. But now, fast forward to today, it's probably better to study AI and and to bring that to the table. So sometimes those rep, sometimes those things change. So let's say you figure out what is your reputation? What can you talk about when you're in front of people? You go networking, you go to a few of these events, you outreach, you get yourself in front of some people, and you actually ask the question, what kind of skills do I need? What what sort of, um, I need to build my skills? I need to build my knowledge. What do you think would be a valuable thing, uh, to do? Because people who are at that next level up, they're they're noticing what they what they need. Uh, they're noticing what's hot, what's not. Um, so they're going to be able to teach you or or guide you. And and, um, to Cody's point, you know, you you want to have a mentor in your life. You want to have someone who's who's been there, done it. You want to, you know, partner with a bigger organization and get some of those. Before Kim Kardashian was Kim Kardashian, she was Paris Hilton's, uh, assistant, and she learned the playbook for being famous for being famous. And then she took it to a new level. Took it to a new level. So she she, uh, she did an apprenticeship and then she applied the apprenticeship.

>> One of the things that all of us have in common is we make content. If you guys were starting from zero today, >> with AI in the picture and all of these platforms and the way things are going, I I spent I've spent a lot of time thinking about the next big opportunity in content and I think about the next big platform. Where would you be starting today based on who you guys are and the skills that you have and the things you're interested in is probably a better way of saying it. Would you be on LinkedIn posting once a day? Would you be on TikTok making videos? Would you be on YouTube starting a channel? Would you start a newsletter? And with AI in the picture, I think it changes the answer because content is going to become very easy to make. So where does the value accrue to? Like where does the value move to in a world where every kid, a kid in Mumbai could make a Reel or a quote picture now with ChatGPT? So where is the value going to accrue and how are you going to milk that cow? How are you going to capitalize? Like, what is the one thesis you have about the future of content that you haven't told anybody yet? We talk about social media, and I think, um, there's been a lot of talk about it shifting really more towards interest media rather than social media, right? So I think this is extremely important because what what Cody was referencing earlier is again, entertainment versus education. And so Rihanna and Drake, I see both as entertainers. Now, what's interesting is that where do they have influence? So she used the word intent, but fundamentally, I say like, how do we increase the likelihood someone complies with the request or complies with the solicitation? Right? If I tell you to do something, one, I mean, we've all seen some creators who have tiny audiences, but if they say, "Hey, go do this thing," you know, they have 100% not really 100%, but they have a huge conversion on a very small audience. And then other people, you know, I can name some TikTokers right now that have, you know, 50 plus million, uh, followers that have had 13 failed launches because they have views, but they have zero influence. No one listens to them for their advice.

>> And so, um, in order to create influence, there's four things. So, number one is, and so I just remember SPCL, right? So, you have status. So, somebody who controls scarce resources. So, a bartender at a bar, there's alcohol behind them. It's a scarce resource. In the bar, they have status. When they walk outside of the bar, no one cares about them. But in the bar, they have status, right? So that g so they give influence. The second is power. And so power is basically, um, say do correspondence, meaning if I tell

You to do something, follow these instructions, and a good thing happens. Then, you—I—I'll increase the likelihood that you comply with requests in the future.

And so, for example, Martha Stewart, uh, was the first self-made female billionaire. And I think there's a huge amount of reasons for that. And one of the biggest ones is that she literally gave people recipes, and they followed the recipes, and they had a good thing happen. And then people told them they were great, and this cake was great, and this lasagna was amazing. Their family, their friends, they got—they also got status. So, a massive good thing happened after following explicit directions. And so then, when she said, "Follow my next directions and buy this thing," people said, "Okay, the last 10 times I did it, it worked. I'll do this too." And so that's why she had so much influence.

The next is credibility, which is, do you have proof right now? All of these can, um, happen at the same time or separately. So, I'm trying to give more isolated examples for each of them, but like, one thing can check multiple boxes. So, if I say, "Hey, I sold a company for $46.2 million," I have money, which is where the status comes from, but I also have credibility that the stuff that I do works. I wouldn't have power yet, though, until I say, "Hey, if you take what you're currently doing and then add a bonus, urgency, scarcity, a guarantee, you know, think about a value equation. All of a sudden, you can sell it for way more money." And then you follow those instructions, and then you do make more money. Then you're like, "Now I'll be more likely to comply with this person's request in the future." And so then that person gains influence.

And then the fourth L is likeness, right? Do they look like me? Right? Do they act like me? Which is both, you know, physical, but also psychographic. Like, do they have—they share the same values as me? Are they similar? And so, if I have two people that both have SPC, so they have status, they have power, they have credibility, and then one of them just also looks like me, I'm more likely to listen to that person. So, each of these are additives. So, if you have all four, you'll be more influential, right? And so, um, lading this back up to conversion, we think, okay, well, if I'm going to make content with a purpose of conversion, then I want to make stuff that demonstrates these four things, right? Right.

And so that is why educators typically have significantly smaller audiences, but can usually generate a lot more money than entertainers can. And entertainers typically can monetize almost exclusively through sponsorships as the most efficient means or vehicle. Now, where does an entertainer have influence? Rihanna is beautiful. And so she does have credibility in terms of beauty. She does have, um, and then especially if she starts making content around that stuff, she takes her entertainment audience, but she's talking about something she has credibility to, and then she can add power to that because people start following what she does, right? And then they start looking a good way, and then they say, "You know what, she really does know what she's talking about here." And then all of a sudden, when she does point people to, you know, to a thing that that that they can buy, then they're more likely to do so. And so it's, it's, it's how do we merge those two things together?

And then when we're making the content, and I think a lot of people we're starting out are very obsessed with views, which I would strongly recommend, especially in this interest media time, that it's, it's so irrelevant. And what I mean by that is if we think, all right, I want to, I want to start a, a bait and tackle drop shipping business, whatever, right? You for for fisherman. Well, if I just start making videos on philosophy, I might get way more views than I do if I make, you know, videos on bait and tackle stuff. But the likelihood that the people who are watching philosophy also want bait and tackle is very low. And because the content is now the targeting for social, like if if anyone's run ads before, you have to select, okay, I think I want 42-year-olds, and I want, you know, men, and I want, you know, whatever, right, as you go through it. But the thing is, is that the algorithms are so good, and the AI is so good at understanding what the content is about. And they also know what type of people consume this type of content, they just do the targeting for you. And so if you want to reach a certain type of person, you just only make content that that certain type of person wants to consume. It's actually easier now than it was before. And so you can have a 40,000 person audience, but that 40,000 person audience might be made up entirely of fishermen who buy tackle, which I'll bet you you'll crush.

And so, um, that is how I kind of see the, the, the quote future of of media, at least, um, is that if you want to have maximum persuasion or conversion power, we want to make content that is explicitly for a specific audience. And we want to demonstrate the proof that we've done, right? We want to have things that they want. We want to give them instructions that they follow that good things will happen for them. And we want to look like them. And if you do that, you have somebody who's going to make a lot of money from an audience.

That last point is super interesting as well. How do I make myself look more like my audience? And I think relatability and humanizing yourself is one of the great ways to do that. I think it's a very fair point. I mean, I also think it's not just physical traits. So, you know, let's say that you don't look like the audience that you want physically. What are the values that that audience has that you can have them see themselves in you? And, and, you know, it's kind of like whether or not you like the guy who cares. But let's say, you know, Trump, for instance, really looks not a lot like his audience predominantly, you know, in suits and ties, constantly sort of a blue-blood billionaire from the East Coast. How does he associate with this group of people where really he doesn't look like them on average? Well, it's because they believe that he has a similar moral compass to them. They believe that he has similar ethics to them. And so I don't think that creators have leaned into this enough. And I don't mean to become clickbaity or political or or divisive or anything like that. I mean that it is rare to see people in business h take a stance that could hurt their business values, for instance. And Chris and I have a rule, which is we don't have close friends that haven't done something publicly that could be against their best interests. I, I just don't want friends that don't have that that haven't done that because I think that the world is really hard, and I want to see if somebody's going to have like moral fiber before I become quite close with them.

Super interesting. Yeah. And so I, I think you could do that as somebody who is a content creator today, like be value aligned with your users and show that. And, um, also to the point about the algorithm becoming about interest-based. It's also becoming value-based. We're seeing echo chambers emerge around ways of thinking, right?

Well, I, the content that I saw of you that most interested me was when you were talking about, um, how important ownership is, and you were talking about just the philosophy of ownership. And you said, "There's a group of people who want you to own nothing and be happy about it." And I was like, "I really resonate with that. I want people to own their businesses, and I want them to own their stuff." And I liked the fact that you were standing in front of a huge audience taking that position, and everyone knew that it was a little bit of a, a position to take, and it wasn't specifically content about how to build a business, but you were sharing something about yourself.

I have a belief: you don't actually ever sell anybody anything. You only find those who are already predisposed to want the thing that you are selling. And if you believe that, then I think your business gets easier too. Easier to target people. That's why I never kind of got off on that content. You know, it's really big online on sales where it's like, "Here's how you close them," you know, "Here's how you do this," "Here's how you you switch them," and you give them a hot dog, and then they buy the car because you gave them the hot dog because of reciprocity, and you're like, "Huh, I've never bought a car because somebody gave me a hot dog." But apparently, this is what works on Instagram. And so I don't think that's actually true. I think you just find people at a trigger moment that they want something, and then you give it to them.

Mhm. Regarding content, for me personally, I find that the only reason I'm going to create content is if it's in alignment to a mission that I've got. So I don't actually want to create content. I don't want to be out there naturally. I would much rather be a way more private person. Um, and you won't, you won't find a lot of stuff about my family or my my kids, my, you know, very rarely do I post anything like any of that sort of stuff. But for me, I do it in alignment with the mission. I really believe that if you're on a mission, you've got something you want to achieve in the world, you're going to need other people to believe in it. You're going to need other people to get involved. Um, you're going to want to hire talented people. Those talented people are going to want to, you know, see you online first. And it's all about the building relationships at scale. And content is just people discovering someone new, like you would a friend, and then getting to know someone. And I think the big play in a post-AI world is having really deep relationships with a lot of people using long-form content, uh, where you share who you are, what you're about, what's your mission, what's your origin story, what's your vision, um, what are your values? And people then say, "In a very noisy world, I will pay attention to what Steven says."

Before we move on to a little game that I've prepared for us here, um, I, you're all very good at pitching, and you all have your own frameworks for pitching. So I wanted to to pause on that for a second. What is, Daniel, what is your framework for pitching a business or an idea?

There, there's two things to start with, which I believe that entrepreneurship is the journey of a thousand pitches. That basically, what we do as entrepreneurs is we pitch stuff into existence. Um, and the penalty for an average pitch is that you do a thousand pitches and you get nothing to show for it at the end of it. And the payoff for a great pitch is that you do a thousand pitches and you end up with 10 to $100 million. You end up with an amazing team of people and lots of customers, and everything, everything's great. So I think treat entrepreneurship as the journey of a thousand pitches. And also treat pitching as this magical thing where you get what you pitch for, and you can't switch it off. So, for example, if you say, "The economy is bad," "The economy is bad," "The economy is bad," as if by magic, the economy is going to be bad. Uh, if you say, "I'm seeing lots of opportunities right now," "I'm seeing lots of opportunities right now," you, you start conversations where people go, "Oh, I, I've seen an opportunity as well." So, whatever you're out there talking about, you tend to bring those conversations to the surface, and then it's a self-fulfilling loop. With that said, you have to have a framework for pitching. If you're going to do a good pitch, it's got to be a framework. I've got social pitching framework, scheduled pitching framework, and sales pitching framework.

So, social pitch: name, same, fame, pain, aim, game.

What's a social pitch?

Social pitch is on social media.

Yeah, or, um, in a social situation. It's basically a situation where you've got about 30 seconds before someone thinks that you're being, uh, too obtuse.

Okay?

Right? So, you've got about 30 seconds of people's attention. And you're going to say, "What is your name? What are you the same as that they already understand? What makes you famous or different? Uh, what are you aiming for right now? What's your bigger game? Or what pain do you solve? What are you aiming for? What's your bigger game?" So, there's a few things you can put in there, and it rhymes so you can remember it in a, in a social situation. Scheduled pitches, I always do something called CAPSTONE. And it's clarity, authority, problem, solution, traction, or the why, either way, opportunity, next steps, and an emotional ending. Right? So, that spells out CAPSTONE. Now, is that the best pitching framework? Maybe, maybe not. Maybe there's better frameworks. But the point is, is that you've got a framework that you're not just winging it. You're not just, you know, randomly spewing words. You've actually gone through the process of thinking through your pitch, uh, in a framework approach. One thing that's really fascinating is the three of us have a framework for everything. Like, we, we're just like very framework thinkers, and I've noticed that with a lot of entrepreneurs. Um, do you guys have pitching frameworks? Be shocked if you didn't.

Yeah, I do. I mean, I think I'm like lazy intellectually, and frameworks help you remember things. And so if I, you don't have very good memory, then it's just easy to put it in something that can make sure that you remember it. That's why when we were in school, you know, they used to make us sing songs about how to remember the various states. If, if I wanted to raise a bunch of money from other people that didn't know me, and I wanted to never have a problem raising money again, I didn't want to use any of my money ever, I would use what I learned in venture capital, which is the mightiest touch. And, and basically, I think you need one of these four in order to raise money. You don't have to have all four, but if you do, that makes it really, really easy. The easiest one is profit, right? If you have a business right now that's making money, profit in your pocket, you can raise capital. You can raise money from people as long as that amount that you're raising is reasonable to the amount of profit. If you don't have any profit, but you have growth, let's say like Replet, we were talking about a big AI company, great. You can raise a bunch of money if you got growth, too. The third thing, if you don't have either one of those, you don't have profit, you don't have growth, but you have a history. I've sold a company before. I've built this before. You can raise purely on the fact that you've done this before. And if you haven't done any of those three, you've done nothing in life, then you need a really good story. And the story is something that you can often raise money off of. So I believe that we are going to create the next XYZ. And if we do this thing, then you will all make money, I will make money, and we will change the world together. And so I call it the minus touch because I think people who accum—if you can accumulate this over your life, it's not that hard, right? So eventually, at some point, you'll have a, a history, which is your proof. Then you can craft a story. You'll get better at it as you continue to grow. You will learn how to get profit in some way. And because you've driven profit before, you'll know how to get growth. So I think like almost any entrepreneur over time, if you focus on those four things, can raise money, and you start with only the story when you have nothing.

Alex, I have a lot of pitching for, um, I, I'll say first and foremost, like if you're trying to sell anyone anything, um, proof will always be promised. And I can say that, you know, a thousand times in a row. Like, you could literally say nothing, get on stage, and then just hit next on testimonials for 60 minutes, and you will close a percent. Like, literally the last slide just says like, "Go over there to go buy something," and you could say nothing, and you will, you will sell.

A lot of people say that 70, 60, 80% of our communication is body language. Do you think much about that? Alex, you have a, with or without you energy body language. It's a casual, it's a very casual body language, which in fact reinforces your authority in a way. So do you think about if people are right that 60 or 70% of our communication is the things we don't say? Do you think about training people on how to hold themselves, how to be, you kind of alluded to something there, which I think people don't think about, which is actually the less you say sometimes, the higher conviction and the more I believe you.

Yeah. So I will, so I'll, because I think getting, so I'll just, there's so many variables here, but I'll just try and focus on the ones that, um, a lot of people sell over the phone and even via Zoom. It's harder to see body language as well, which nowadays I think a lot of selling happens in those two environments even more than in person, even though that's where I came from, which I actually think is the best place to learn because you have to control every variable, and then you have far more leeway on the phone or on Zoom than you do in person. And so to that extent, um, there's basically five things you can control about how you talk. And so you have your speed of talking, like how, how fast you talk. You have your cadence. You have your, um, basically your, your annunciation. Like, do I pronounce every letter in the words that I'm saying? You have the volume that you speak at, because if I talk too low, like you on a phone, it doesn't really matter because they're just going to increase the volume. But if I lower what I'm saying right now, it sounds more important. In person, it's more important. Volume is more important in person. And so those first three I consider there's kind of a persuasive tone, which all three are constant. And the only point of those is to maximize comprehension. It's just that they can hear you, that they can understand what you're saying, because you're talking in a speed that they can understand. Like, I'm somebody who talks fast, and I have to, I have to pull back how fast I talk when I'm in, like, a selling situation. There's only two that you, that I teach sales people to try and actively control, which is going to be pauses to draw attention, and when do I raise my voice? And the reason that those are the only two things you really need to teach a salesperson, outside of the persuasive tone, which is that that you're going to talk at a certain speed, which usually about 150 to 170 words a minute, because that's the amount of speed that most people can understand. You're going to enunciate the words, which is going to force you to actually speak at that speed. Um, and you're going to talk loud enough they can understand you. This sounds very simple, right? Like this sounds like so simple. Like I can't believe people don't do this. Except they don't, and they don't close. And so the only things that you have to teach a salesperson, and these are so important, like there's been three independent studies that are like massive meta-analyses of sales people. The sales people who one, speak less, close more. And number two, the sales people who know when to shut up, most importantly, after you ask for the sale, like if you wait eight seconds after you ask someone to buy, you close 30% more sales.

If you wait eight seconds.

Yeah. So you ready to start?

Okay. So.

Mhm. And so people, they'll like, they'll close themselves, but the sales people are so afraid of that silence that they then jump back in. It's like, you had the sale, just shut up.

You know what's fascinating is there are actual studies now that show for women in particular that you make more money if you do one thing, which is you wear makeup, which is wild. So they did, there's three studies that have been done, totally different groups, one by Harvard, one by Stanford, and I can't remember, it was either Oxford or Cambridge. And the studies showed that women who, there was no attractiveness differential between them, but one wore makeup consistently, uh, at work, and one didn't, they made anywhere from 20 to 40% more money inside of this study. What I thought was really interesting about that, because I'm not really historically a makeup girl, although being fully face-painted for this, is that that actually makes sense in a lot of ways because we do have this initial reaction that we always have, uh, with people. You know, we judge somebody, like you talked about, almost immediately. And so when I saw that study, I thought, well, first of all, that's interesting. You don't have to be smarter, better looking, uh, or anything else, and you can make more money just by the way you present yourself. And so I thought, well, what about the way that you dress? Is, is that also the same? And there are studies that back this as well, that in fact, you can make more money as a man for dressing one way, and as a woman, and women are interesting because,

You are not the norm.

What am I missing here? You got the lumberjack.

I've got 20% sitting on the table right now.

But what's fascinating is, you know, I like things where you don't have to, you don't have to be better than anybody else. You can just use human psychology to make more money. And so if I am a woman, I know that the way that I dress, so when I pay attention to my dress and dress professionally, whatever that means in this instance, in the study that I saw, it was like, you know, what, what I would have on a blouse, a suit, something like that, women make two times more than men when they dress, when they dress better. Men, it actually is less important. Still more important though, if you dress professionally in a suit, and you don't have all the other proof and things you have, you have this sort of interesting thing that's like a, you have sort of, um, diametric opposition. I make a lot of money, and yet I care so little about money that I dress in a white beard. Yeah. Exactly. And so, and so men make somewhere between 15 and 18% more when they dress in suits. So I think there's a, a real, um, argument to be made for if you're going to pay attention to the way your voice sounds, that takes some training. Doesn't take much training to change the way that you look professionally and how you dress. And the only other thing that I would talk about on sales and pitching is we tell all of our company people, um, the line is show, don't tell. We increasingly do not believe the things that were heard. So like, think about a sales pitch that goes like this. Um, you know, uh, we, for instance, have a lot of home service companies. So these home service companies are selling a homeowner on, let's say, landscaping. And so I'm going to come, and we're going to clean up your lawn, and here's what we're going to do, and this is how much it's going to charge. I'm going to charge, and this is how long it's going to take. And you can tell the client that we're an expert at this. I've been in business for 42 years. We have, you know, 10,000 reviews on Trustpilot, etc. Or you could do something that'll double your conversion, which is simply bring a phone or an iPad with you and say, "Can I show you what we did for your neighbors down the street?" And just show them the image of it. Just go, "We do have a thousand Trustpilot views. I don't right here. We could see what the last one said." Click on it. Show them the Trustpilot review. You don't have to train that. And I really like my salespeople to not have to become experts, but to be enabled by what's called sales enablement or technology just to show because we are a visual species. And so wherever possible, if you want to increase your conversions, I tell my team, you are not allowed to close a sale without showing something.

Some visuals.

You have to have a visual because it's just a trust transfer and a higher signal.

I've got three boxes here, and these three suitcases contain different amounts of money. One of them contains $1,000, one of them contains $10,000, and one of them contains $100,000. You're going to pick a suitcase, and you're going to tell me what you would do with that amount of money if you were starting with that amount of money today to build a scalable business.

So, do we keep the money?

He wants to buy a watch.

I'm like, I'm feeling $100,000. All right. What do we got?

Oh.

I have $1,000. So, do I get to keep the money? Is that how this works?

Yeah, you can keep it. Smells, smells, smells like money. Okay. So, I have $1,000. So, I would, um, take the $1,000, put it in my pocket, do nothing with it, and I would watch YouTube videos on AI integration into small businesses. And then I would go to small businesses, and once I had a specific integration that I would do, which I would probably bet would be around likely email list activation, because that's typically like fastest, easiest money that most business owners have is their contact list. So they've got, you know, they've been in business 10 years. They've got, you know, 8,000 customers they've sold over that whole time period, and maybe a list of, you know, call it 20,000 leads that they've had. They never email them ever. If they do, it's just like, here's our random discount that we send once a quarter for Christmas or whatever. And I would say, "Hey, um, I will email those people, and I will, uh, get everything approved by you, and don't pay me anything. Just pay me a percentage of the sales that we generate afterwards. How's that sound?" And that offer tends to do well. And I know that because I've done it. So that's what I would do. And the $1,000, I would, you know, go buy, uh, Leila something for a little bit of time so that she can stay with me until, uh, I make the money for my, my email reactivation campaign.

See what I get. I got the $10K.

All right, we're going around the circle here. Um, I like it. I would find the person who would buy what I was selling for the highest dollar amount humanly possible, which means I would probably go to private equity companies. So, Alex gave me the idea for Main Street. I, I know that Main Street businesses are like often cash-crunched, right? They don't have a lot of money, and they often cannot extract enough value from a lead that I need them to. So, Alex would need to find the perfect company to do that, and there's lots of them, or he would build his own, which would be great. I think in my specific instance, I want to go to the people who are already good at extracting the most value humanly possible. So, I'd probably try to go to a private equity firm, and I would,

What's a private equity firm?

It's basically a fancy way for saying that people use their own money to buy businesses as opposed to public equity, where people use the stock markets' dollars to buy businesses. And so examples would be like, uh, you know, KKR, Carlyle, uh, Cerberus are some of the biggest in the world.

So they go around buying people's businesses with their own money?

That's right. Yeah. Yeah. They find entrepreneurs right about the point where they cannot take it anymore, and they buy those businesses, and then they, they grow them hugely. And, and again, because I'm better at partnerships, I would want to go to them, and I would want to say, and it really, what's interesting is I bet all of us are going to be really similar. The money actually doesn't matter. And so even though I have $10,000, 10x what Alex has, it doesn't actually matter because what I would do, still, $10,000 is not enough for me to make a couple million, which is what I would want to do with this. So what actually is the differentiator? What is the business model I choose? Who do I go to sell it to so that I can get the most value out of it? With these PE companies, what I would do is I would go to them, and they're buying companies all the time. And so, there's two ways to sell to a PE company, and I'd see which ones I could get them to sign up for. On one hand, there's something called a deal sourcing fee, which is if you can find companies that are in the niche that PE companies want to buy, they will pay you for sourcing the company. Um, and I know this because I pay deal sourcing fees. And so, I would go to private local private equity companies. You're not going to be able to get to Cerberus or the big guys. So, I would go to the ones in my local neighborhood that you could find by searching on AI to say, "Local private equity companies buying these types of companies." I would reach out to the GPs, those are the general partners of the company, the guys who run it, and I would say, "What type of companies are you actively purchasing right now? What's your investment thesis and deal box?" And if I could get them to respond to me, great. If not, I'd search, "What do private equity companies typically want to buy? What, what is the deal box or investment thesis of a private equity company?" I would find that deal box, and then I'd play the game of doorknocking. I'd go to a bunch of these businesses and try to find companies that wanted to sell. And then when they tell me they want to sell, and I have a buyer, which is the private equity, uh, company, the private equity company will pay me either a percentage of the sale or a flat fee for sourcing it.

What might that look like in terms of a percentage and dollar number?

Yeah, I mean, if you're like a, a non-institutional player doing this, I think you would go to them and say, "Can I get like $10K for every company that I source you that's over a million dollars in revenue, that's profitable, and within your deal box?" They'd probably say yes. The normal sourcing fee is somewhere between three and 5%, but you're not going to get that when you're brand new. So, but I like the idea of making $10K on one deal to start. Then what else am I learning while I'm doing this? I'm also learning simultaneously how do you buy businesses? What type of businesses? How do you find businesses for sale? I think this is the highest leverage activity I know how to do. Like, I just, I know more how to buy a business that's already making money and make it make more money with a higher degree of certainty because if it's already profitable, it gets out of the valley of death, which is where a company starts and never actually makes any profit. And so I would start there. And then what would I do for that? Well, the second that they see that I'm good at sourcing deals, there's going to be, they're going to be throwing offers at me. But what I might do instead is go to those GPs and say, "Hey, I'm pretty good at doing the hardest part of private equity, which is finding the deals. Why don't you guys back me for me to find the deals for you?" Maybe they'll invest in my company for me to then run a private equity firm. Or maybe they'll say, "Come work for me," and then I can make a couple hundred thousand, I can learn what I think is the best, uh, skill out there to learn, which is dealmaking, and I can use my leverage, which is knowing what a company's worth and how to buy it using other people's money in order to increase, uh, my earnings. And that's,

Interesting. You'd both use the money for personal things, probably just pay your rent or take your time.

Doesn't make a difference at that level. And I mean,

Even the hundred is close to, I mean, it's more than 10 in one, but,

Yeah. And, and this is just one idea. I think there's so many things you could do with one,

But they're all very similar in their fundamentals.

Well, you go to find some, like the leverage comes from going tapping into existing networks. You find an existing business, and either you're selling the business as the product, or you're selling the product of that business. Right. Exactly. So, you're selling either way, and all of it is promotion. You're selling, and you're trying to get a percentage of upside. I'm getting a percentage of, because like to Cody's point, a lot of mainstream businesses don't have money, and you're like, "Cool, pay me on money that I make you," and they're usually very, very generous with money they don't have yet.

Um, same, same for, you know, a deal that we haven't made yet. I'll give you, you know, a fee for those things. Again, it depends on the timeline. If I have 30 days, then like,

Getting a deal done in 30 days will be tough.

Um, but like getting a brick and mortar, it's like, probably do that in 48 hours to get somebody to say yes to free money for like no risk, and I do all the work. It's an easy offer. So again, I think it dep—that's where like the constraints of the initial prompt is like, how much money and how much time. If it's a year, it's like, all of this changes. If it's 30 days, and I have nothing, it's like, well, then we'd want to generate as much cash as we can in little time as possible with no risk.

Yeah.

Daniel's about to invest in the S&P 500.

Right. Because,

He's like, I take your, your $10,000 and I raise you.

Yeah.

So I have $100,000.

So.

He's leaving with it.

This, this is a dangerous amount of money.

Yeah. This is the worst-case scenario for most people because if you have a thousand, you know, you don't have money. If you have $10,000, okay, you might get a cleaner, you might get an assistant, you might do a few little things with it. The danger of a h $100,000 is you can kid yourself into thinking that you've got money. And it will make your head spin how fast you can blow through $100,000 if, if you don't know what you're doing. If you give me a Formula One car and ask, "What am I going to do with it?" I'm gonna crash it, right? If I can get it even started in the first place. So, I've got to come up with something that the first problem that I have is I don't have the knowledge. I don't have the network. I don't have the reputation. So, here's what I'm going to do. I'm going to leverage Cody's. I'm going to go to Cody and I'm going to say, "Cody, can I do a deal with you? I would like to start a business. I know you've got lots of ideas that you just don't have time for. I'm going to invest $100,000 as debt for equity for 10%. So, I'm going to put 100 grand in, and that'll come out of the business at some point, but debt for equity on 10%, and I'm going to do sweat equity for 10%, and you keep 80%. And it's your idea, and it's your network, and it's your reputation, but I'll be the person who's heavily invested in this. And the only condition is that as the business becomes profitable, we can repay the $100 grand. Um, and then once it's repaid the $100 grand, either you buy it, or we can sell the business." Now, what I'm doing there is I'm basically acknowledging I don't know what I'm doing. I'm acknowledging I don't have the reputation. I don't have the knowledge. Um, all I have is this $100 grand, and I have a very strong desire or will to be an entrepreneur. Now, what's going to happen is that probably with an hour of Cody's time per month, she's going to be able to say, "Here's the idea. Here's, here's my CFO. Talk to my CFO. Here's my head of marketing. Talk to my head of marketing. Here's my friend who's actually got even more money and wants to invest." And she's just going to like fire off a few emails, and she's going to love the idea because it's her idea. And I'm going to, I'm going to work hard, right? And what's cool is that when the time comes that that business becomes valuable, I've got one buyer on the table. Cody's either going to say, "Hey, look, I'll buy you out because it's only 20%, and now I own the whole thing," or we go to market, and Cody will know someone who can buy the business, and I get 20% of the exit. So, but the key here is that just that acknowledgement that the, it's really, it's the knowledge, the network, and the reputation that is the valuable bit. And the money is a bit of a red herring.

And you're going to get Cody's skills because you're going to be in her proximity. You're going to get a little bit of her reputation.

At the end of that deal, I will then have knowledge. I'll then have reputation. I'll then have, uh, all of those things will have leveled up for me.

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