Transcription
I was just at a private event for ultra wealthy in Hong Kong. Average revenue in the room was 72 million a year, but there were a lot of billionaires doing much bigger numbers and it was very hush-hush, like no recordings, no phones, but there was just so much sauce dropped in the room. Had to make this video for you, tell you what I learned.
All right, so my first big takeaway is what I'm now dubbing kind of like the most straightforward path to build wealth. It's actually the way that I built the company that I sold for $110 million, and I hadn't really put it together until seeing it so clearly displayed in this room in Hong Kong. I think if you're building a business, it is in your best advantage to follow this very simple formula, which is basically to combine two different things. So, the first is a trend. This is something that is happening across society, consumer change, technology, something that's growing very rapidly year-over-year. But a trend is not enough. The second thing you need is you need to create a blue ocean or a new category of product in that trend.
So, let me give you two examples from the room. The first was IM8. If you haven't heard of IM8, they went from zero to I think $180 million in revenue in the first like 12 months or something crazy. And the way they did it was this exact formula. First, they jacked a trend. And in this case, that's longevity. Longevity has always been a thing, but lately it's been exploding in popularity thanks to Brian Johnson, Andrew Hubberman, etc. And so they were taking advantage of this longevity trend. They wanted to make a product in that category. The second thing he did that really made IM8 take off is he created an entirely new product, and it's actually pretty simple and straightforward. He wanted to make a powdered drink that would help you live longer, give you all the vitamins, everything that you need. But the powdered drink category is super crowded. AG1, Athletic Greens, all these green drinks are already crowding everybody out. And so what did the founder do? Well, he didn't make another green drink. He made the first red drink. And by just creating this new category of red drink, it stands out on the shelves. It stands out in marketing, and the thing is selling like hotcakes.
So, the second example from the event was another company called Caseify. Now Caseify is really interesting because they sell phone cases in Hong Kong. If you've been to Hong Kong, you can buy a phone case for like 30 cents. It's not special. But Caseify has a similar origin story to IM8. Actually, when they started the company, iPhones, smartphones were really still taking off. So, they had a natural advantage of this trend of just more smartphones being bought every year. The second thing is they created a new category. It wasn't just another phone case, wasn't a more durable phone case. They described it as the first phone case that let you represent who you are through your phone case. And so, your phone case wasn't just a way to protect your phone. It was a way to show your unique identity. And by doing these unique designs and collabs, it became sort of an expression of who you are, not just another 30-cent phone case, which is why now Caseify can sell a phone case for like $50, $60 in Hong Kong when the average phone case is like a dollar. So this formula of finding a trend and then creating a new category within it, super powerful. I've seen it enough times to say this is probably the most straightforward way to actually build wealth.
The second thing that really stood out to me was what I would call this emerging AI gap between people who are operating in an AI-native way versus people who are sort of dabbling in AI for productivity. So, what's become really clear to me is there are essentially three categories of people in this new era of business. The first, they're not using AI at all, and these people are still working on their craft. You know, maybe in six months, they're like 10% better as they sort of learn and improve and things like that. Second category, I would call is sort of your typical AI user today, where basically you're looking at the work that you're doing and you're saying, "How can I automate some of this with AI? How can I speed this up?" The analogy I would give for someone like this is maybe AI lets you get 10% more productive every month, and that compounds. So, in six months, instead of just being 10% better, you'd compound and you'd be 77% better. And that sounds great. I mean, 77% better at your job with productivity gains and everything is really enticing.
But there's a third category of people that are basically just eating everyone else alive. And these are these sort of AI-native people that I'm seeing in these rooms. So, what AI-native entrepreneurs are doing right now is they are not looking at the typical tasks that you would do as a human and saying, "How can I do these faster, better, more efficient with AI?" What they're doing is something that Gary Tan called boiling the ocean. The old business advice in a pre-AI age was, "Don't boil the ocean." What that really meant was, don't try to do too many things at once. You can't, you know, launch this sales funnel and improve your marketing and improve your newsletters and blah, blah, blah, blah, blah. You want to do one thing really well. And that was very good advice because the limit on your productivity, on your revenue, on everything was really manpower. However, things have really changed in the last few months. What's happened now is that the limit on what you do is no longer manpower, and but it's also not, I would even call, human-oriented tasks. And the best founders that I saw firsthand in that room are doing things that you simply cannot do with this old mindset of, "How do I do things more productive with AI?" They're doing things that humans could never have done.
So, let me give you an example to make it a bit more concrete for you. We do social media, and so over the course of the last few years, I've uploaded probably thousands of hours of videos. Now, if we want to analyze that performance, a typical sort of human mindset would be to go in, look at the analytics, see what videos are working, not working, and try to guess on like, what can we learn from this? Why did this video work? Why did this video not work? The second category of person would probably go in and say, "Hey AI, look at the analytics and tell me which videos are working and not, and why." But the sort of boil the ocean concept would be, "Why don't we download every single transcript of every single video, look at every single second of retention, every single metric in our entire analytics database, and combine the transcripts, the analytics, and everything, and see what insights can we pull from this?" That's, you know, thousands of hours of work that humans just can't do. It's too much work, but for AI, it's just compute. And so this big mindset shift is really thinking in a way where, "What if labor was effectively free?" For lack of a better word, what if labor was just compute costs? And so these AI-native founders, from what I saw in the room, is they are not improving 10% every six months. They are not improving 10% every month. They're getting like 10% better every day.
So, let me put that in perspective to help you understand what this actually means. If you were to take that same 10% getting better every month, but make it daily, so you're getting 10% better every day, and that compounds in six months, you're not 77% better. You're not like 200% better. You are 37 million times better than when you started six months ago. And now, listen, I'm not here to say that AI is going to make you 37 million times more productive or that it's going to make your job 37 million times easier. But here's what I can tell you. I was in that room, and there was a case study very thoroughly showed by two young guys in their early 20s. And in just four months, they had gone from zero to $7 million a month in revenue using AI. And the way that they were doing it with this sort of boil the ocean strategy, you could never have done that before AI. The gains that they were making in terms of productivity, speed, revenue, sales, marketing, everything were just insane.
And so, if you want to actually put this into practice and start using this sort of boil the ocean strategy for your own business, what you can start doing is you can actually look at your business and either ask yourself or very directly ask AI, "How would we do this differently if labor was free? How would we do this differently if compute was literally infinite and we could just flow as much resources as possible? What would we actually do here differently?" And by just asking AI, thinking with that mindset, you will find new workflows and new ways of doing business that are not just making human work faster. It's unlocking entirely new workflows. And that is where I'm seeing the massive gap in people who are going to dominate things for the next few years and people who are just going to be completely run over. It is, I cannot emphasize enough how wide this gap is. It might literally be 37 million times. Like, you need to get on this if you're not.
And then the third thing that really stood out to me is what I would call sort of the two timelines that really need to be on your mind as you're building. So, the first is what I would call time to action. So, to help you understand like true world-class time to action, I want you to think about it for yourself. If you had an idea for a product, how long do you think it would take you to go from having that idea to actually getting your first customer? As in, you've launched a website, if you've launched your marketing campaign, you've launched ads, and now someone's buying something from you. Would it be two months? Maybe three weeks? Here's what I saw in the room. Going from coming up with an idea to getting their first paying customer, average time in the room was one day. As in, you had the idea at coffee that morning, and by 5:00 p.m. that afternoon, you've sold your product to a customer. Now, obviously, that's unrealistically fast to actually build a product, but you don't have to do that right now. You can just have an idea, build a landing page, drive paid ads to it, see if people actually click and buy your pre-sale. We used to actually do this back in the SaaS days when we wanted to launch a new feature. We would actually put it on the website. We'd have like a click here to talk to sales, and we'd see like, "Oh, which features on the website are actually getting people interested in talking to our sales team?" And that was sort of our own pre-sale in the B2B SaaS era. Either way, my point here for you is that what you probably think great execution looks like is a snail's pace compared to great execution. It's literally idea to pre-sale within one day.
But that's only the first timeline that should matter to you as a builder. The second timeline, which I would say is even more important than the first one, but much harder to wrap your head around, is this ability to think long-term. And now, I like to think I'm a long-term thinker. You know, play long-term games, long-term people, things like that. Um, but I was in the room with Wes, the founder of Caseify, and he was talking about building a brand and he was talking about Louis Vuitton and his brand Caseify and expanding into new categories. And someone asked him like, uh, you know, you're doing iPhone cases now, you have this new luggage brand. How long until you start doing all these other sort of product lines? Like, you have a real brand now. And what he said was, "You know, actually, we've only been around for 15 years, so we're still really in the infant stages of building a brand." And as soon as he said it, I was like, "Oh, wow." Like, there's such a gap in the level of the game that you're playing at versus my own thinking. Because for me, 15 years is a lifetime in business. But for this guy, it's the early innings. He's in the infant stages. And I think this ability to move extremely quick when you have an idea, but also be willing to sit in that game and play the game for decades just to get to what you believe is your ultimate achievement is what separates like the true greats, the billionaires that I met in that room from the guys who just make a couple million bucks. It's this mindset of decade-long thinking and the patience that's required to make it happen.
All right, that's it for this one. However, if you're currently building a business right now or want to be, I would check out the video I'm going to link over here. I go through the businesses that I would personally be building and the ones that I'm absolutely avoiding in this current sort of uncertainty around AI. Put a link. Hope it helps.