How to Survive Creator Burnout and Still Scale (Karat Reshare) | Ep 888
01:06:20 Share

Welcome back to the game. This is a guest spot on Eric Way's podcast. He's the founder of Carrot, which is a very large company that helps creators get credit cards. Kind of interesting business model. But this is a super, super business podcast. So I would say this is probably on the more advanced side. But we talk about obviously a little bit on the creator side of how they can build

big businesses, what I look at when I invest in companies, and my philosophy around content as our competitive advantage in the private equity space. Enjoy. If I had that size audience, I would already be playing. Put up or shut up. When I met you three years ago, you had just started on your career journey. Since then, millions of followers. The reason people followed me was because the systems were good. And so because the systems were good, they didn't need me for the systems to work. When I look at creators in the space who've successfully executed this, it's actually very minimal. I actually think creators are...

That's a powerful concept right there. You're saying that people have followers, but they don't have influence. Would you invest in content creators?

Alex Hormozy might be the first creator billionaire, and he's built his business really differently from other YouTubers who might follow like MrBeast. Today, Alex shares why most creators aren't a broken business model, the five ways to make money from content, and how to turn your social media into a real business. If you're a creator wanting to grow, listen to this pod for 21 secrets from Hormozy on how he did it.

When I met you three years ago, you had just started on your creator journey. Yeah, yeah, yeah. Since then, millions of followers, over 250 million arriving for portfolio companies. Is this where you wanted to be? I don't consider myself a traditional creator. Like, I've,

I had businesses and have businesses outside of this that aren't my face and anything, but I saw where just the monster amount of impressions that social media is getting and giving away for free. And I was like, this is the most insane thing I've ever seen. And to this day, I still think it's crazy that like we can get a hundred million, a billion impressions, a quarter for free. I think about creators in two buckets. Yeah. I think there are the words guys,

And then there are the video guys and then the crossovers audio. Then I'm a little bit of both. I started making YouTube videos and I wrote a book basically about the same time. And then the book kind of took on its own, you know,

growth path. And then the videos also did too. The nature of how I've done things is that I'm all about business process and system. The reason people followed me was because the systems were good. And so because the systems were good, they didn't need me for the systems to work.

Whereas many businesses don't have that. And a lot of people follow the creator for other reasons that are not that, that are less duplicable. It's fascinating too, because what you've built, it's a private equity firm in a way, but most private equity firms add value by cutting and slashing operations. In a way, you're adding value because one, here's the business processes to run. The influence you've now built about talking about faceless systems, now you've been able to

bring in your face to increase it. So, yeah. And I think what you said at the very beginning, which is that like entrepreneurs are realizing just the amount of attention that's here. And this is just a way to advertise your business. I mean, that was the that was the entire thesis on acquisition.com was I'm a big fan of something old and something new.

So like something old private equity with something new social media. And like, how do we, how do we bridge that? How do we, how do we merge that now? Cause there's been old school. I mean, Warren Buffett's an influencer for sure. He's just legacy media. Ray Daly is an influencer. Now he's starting, you know, he's making his TikToks and things like that. Naval's an influencer. Of course, these guys get deal flow because they're out there, you know, they're, they're talking about business. And so they get it. I just took what they were doing and just like,

did a lot more right what type of companies we look for the process overall um those things have changed a lot from when we probably spoke three years ago um

Because three years ago, I was looking at basically running the gym launch playbook that we did, taking a company that has basically digital media driven, that is vertically integrated education around a specific sector. Yeah. And then wrap in business services and then be able to package that because you have revenue retention and then sell it. Right. And transition from a face driven business to a kind of consulting business that's that's in one niche. Right.

It's a difficult operational challenge for...

for face-driven businesses to remove the face. And I think that makes sense. Like Taylor Swift isn't looking for somebody to like step in and sing for her. There's a tension in what you said. You became the face for faceless systems. Your premise was, I have these processes that work, a hundred million offers, a hundred million leads. You don't need Alex Ramosi to literally be doing this. And get value from it. Exactly. It's to empower you to do it. As you said,

The business model of the creator is very different. Colin Samir talked about how there's an inverted pyramid where the creator is almost the chokehold, the gate point for everything because you need Taylor Swift to be there. Now you are an influencer. And so it's funny because you're like, well, I'm going to help you do a system where you don't need me. But now people follow you for that. I think once upon a time, there's a conception of a creator as like the Casey Neistat auteur. Like, oh, hey, I make money to make content.

Where I've started is on YouTube and the advertising, the brand deals is what supports me. I think now you're seeing creators becoming entrepreneurs and content is just becoming how they market themselves. In some ways, like the reputation of the creator was branded, if you will, like in a figurative sense, like branded by the early creators themselves.

which is not reflective of how you advertise a business today. Yes. For creators who want to fall in your footsteps, do you think you'd advise them to double down on the creative distribution side of what they do or to try and get better at the building business piece of what you do? Really interesting question. I think it depends on your goal. So if your goal is to make money, then learn the money game.

If your goal is to make content, then get, you know, just keep making content. I had a conversation with other Uber creators not that long ago, and we operate at acquisition.com off the theory of constraints.

And so the positive of the theory of constraints is that any system will grow until it's constrained and then will grow no further. And so, you know, these gentlemen had like subscribed to that and they said, hey, Alex, I think we understand what our constraint is. You know, we have our media and our content creation machine. The constraint of it is like we need better editors for whatever so we can get even more leverage on our time. And I said, well, what's the goal?

And they said, we want to make money. And I remember kind of like smiling about this. And I was like, your constraint is not that you're a 97 out of 100 on content. It's that you're a zero out of 100 on monetization. If you don't care really about making money and your passion is making videos about whatever it is that you make videos about, then like, you won. Congratulations. You're making videos about stuff. This is what you want to do. It's your dream. This was, yeah. You were like, if I could just quit my job and make videos about Dungeons and Dragons, then like, I would do it. And it's like, awesome. You won. Like, so now...

Where to from here? But there are creators that I've talked to who I'm like, hey, so what do you want? They're like, dude, I just want to make money. And if that's the case, then you got to learn the game. In 2024, you started working with school. Yeah. And so I think it's an interesting question using yourself as a case study. Number one, the product that you're associating with, it's not one that you like built it all nuts and bolts yourself. No. It was very much here's an existing company, but I can grow it. And so it kind of comes down for creators to question of,

Hey, like, do you really want to lean into being an entrepreneur and do it yourself? Or do you just want to do a brand deal? This is gonna be really interesting. So because I've given a huge amount of thought to this. So I'll see if I can get the number right. But the creator paths exist on a spectrum, basically five paths of monetization for a creator. So and they exist on an axis of control.

And so at the lowest amount of control, you have sponsorships, right? Like people just pay you money. You give basically you're an advertiser. And so you promote their stuff. You read an ad, whatever. That's that.

one degree next to that you have being an affiliate, which is just like getting sponsors except you're paying performance. Because what we do when you do an affiliate deal or a performance-based deal, you're saying, "I would like a larger percentage of the upside if I can prove that I can generate it." And so what you're essentially doing is shifting the risk from them to you.

And the more risk you're willing to take on, the greater percentage of the upside. And so winners always work on performance. No one should be able to as accurately estimate how much you can drive as you. No one knows better than you do. Right. You're the seller. So like in, I mean,

M&A terms, the seller of a business, the person who owns the business you're selling to somebody else always has an information advantage because they always know more about the business than the person buying. Right. And so you are the seller of attention. So you should always know the value of your attention better than someone else. Now, if you know that your attention shit and doesn't actually convert at all, then maybe you should just do the sponsorship. Yeah, just do brand reads. It's the brand value. Yeah, yeah, yeah. Yeah, we're just, it's, it's,

overall the impression. Now you've got me on board. Yeah, it's going to change everything. So yeah, I know. So you've got sponsorships here. You've got kind of affiliates and performance deals here. Then you've got kind of the next path, which is what I did with school, which is you promote and you... So I put capital in the deal too. So it wasn't just... You also invested in financial. Oh, I wrote checks too. It wasn't just your time. Yeah, it was a big deal. Yeah. And so...

We invested capital in the company and we invested resources and we invested brand. So it's, we did all. So I think about them in terms of like, what are the buckets that create investment? So there's work. And for me, there's brands. Some people don't have that, but like there's work, there's brand, and then there's capital. And so we put all three into the business. I think there's a really nice sweet spot there because what you can do is rather than try and go through all the iterations, I say, Hey, let's do a deal.

I think there's a really nice sweet spot there because what you can do is rather than try and go through all the iterations, I say, hey, let's do a deal. It has to be significant enough for me to like make it worth using what I would consider a brand bullet on. And let's get carried into every business in the US, not just creators. And then if like, if that's compelling, then you get to just do what you're good at as a creator. This is me talking to creators and let the business

do what they've already proven. And this is the key point that they've already proven they're good at. And so this is where a little bit of business acumen comes, it comes into play. This is

this is where like understanding what revenue retention is looking at churn looking at user acquisition looking at engagement rates look at activation points whatever that you want to look at a business to understand okay is this actually is the product good because what you want as a creator like the perfect nirvana situation is unbelievable product compounding on its own from word of mouth for 12 to 24 months

in a market that's like very similar to your audience and that you know that you can 10X in a year. That's where the magic happens for both parties. They have an amazing product that could grow without you,

but with you it just grows that much faster and so fundamentally all you're doing is pulling the future forward by like four years you're cutting the compounding curve and just basically step stepwise increasing in a straight line up and then saying okay we're just going to pull year four forward and now we're going to compound starting next month at year four to five rather than year two to three

Right. And that's fundamentally what I was doing with school. And I mean, think about the amount of deals that we look at. School was the only deal that I've done since that time period. It was because it hit all of those things. Now next on. So that's like third stop on our creator world here. The next is that you can white label.

So you can drop ship stuff, which is pretty common that I see as the simplest way of this is like you don't manufacture T-shirts. You find a T-shirt manufacturer, you slap your logo on it and you ship it. Pretty straightforward. And then the final version, final boss of this is that you create a product from scratch or service from scratch and you market and sell it. And those are degrees of control that exist on that spectrum. There is a right path for everyone.

And you just have to have some level of awareness to know which path is yours. Now, which of these can create the most enterprise value?

the further on the right you are, the more enterprise value you have. If you are doing sponsorships or affiliate deals, which is the first two categories that I talked about, those two can create enterprise value in and of themselves if you consider yourself a media business, which is so funny. I was talking to a Mondo creator, so like 20 million plus subscribers. And it's so funny. He was like, dude, what we're doing, like no one's ever done this before. Like have a business around like making videos. And I was like,

So, you know, media has existed for a long time, right? And when I told him, I was like, dude, you should just look at existing media businesses. And it was like this big light bulb. It's like, all we're doing is taking an old business model and just doing it in a new media. Like, that's all it is, right? The difference, though, is if you look at like a great media business of the new age, it's like Barstool Sports. Right. Right. And Dave Portnoy is...

sort of now a creator. I would say he is a creator now, but it wasn't started that way. He just saw the arbitrage that existed for all these cheap impressions. Built some media properties. Yeah, exactly. And he built a network and so that he could sell impressions across a specific demo to advertisers. And,

If that's the business, I just have yet to see. I think YMH, your mom's house for comedy, I think they have a handful of productions. So they're kind of becoming a media. Zach Justice is trying to do this too. You have to talk to Zach. It's tough though, especially if you're the primary like breadwinner kind of for the media business. I would say it's almost simpler to be like, hey, I know a ton of advertisers. Let me sell your ad space. And I think you could far more easily acquire people

Yeah.

It's a great example. Many have failed. Many, many have failed. We're going to reinvent the game. It's like, well, you're just doing a newspaper stint. I'll be on a new medium, the internet. There are some creators who have succeeded in building. Or tabloids. Yeah, exactly. Tabloids, right? Yeah, daily mail. And there are some creators who've gone, they've taken steps in this direction where they've almost scaled their content. So one that comes to mind, Linus Tech Tips is a very good example of

where Linus Tech Tips started with just Linus. And over the time, he's brought in other creators to be on his channel instead of himself. And then you also have creators like, I think MKBHD is a great example too. MKBHD, I still think of as primarily as a media business. He doesn't do that much with products. And well, he actually tried one, a wallpaper app that got a lot of backlash, which I, you know, if I were MKBHD, I feel like I would be like, yeah, I know, you know what? I

what, I'll just stay and do content over here because whenever I sort of go over there, people get mad at me. Now, it sounds like you're saying though, from your POV, this is... Also, can we hit on this real quick before we switch? So...

I want to say this mostly to the creators or people who have started from organic and like built an audience and whatnot. There are two types of angry. So there's angry because you have done something that you said you wouldn't do or that is against your brand or purported values. Right. Then there is people who think that everything in the world should be free. And I find that YouTube or really across all platforms, these people exist and you can by and large ignore them.

And so I think that when people promote anything, they get backlash because anything that you give me that is not free, fuck you die. I think on some level, you just got to be like, okay, anything worth doing is going to get lash back. And there's like, show me one ultra famous person, because this is all we're talking about creators and influencing audiences who doesn't have haters. Right. And so if you're going to get hate, regardless, you might as well also accomplish your objectives. Yeah.

So that's just my two cents on now betraying the brand that you have. No, I think that's dumb. So like if you have, for example, a naturopathic brand of weight loss, don't push a Zempik. That's probably a bad idea. At the same time, if you said, hey, I've got these supplements that help you do that, or I have this, you know, nutrition program that I'm, you know, you do a retreat with me three times a year. Seems very natural. Of course, I'm thinking of liver king because the whole premise was his gains came from his diet, not from other things. A hundred percent. If you've been honest, I think it would be fine. I think, yeah. Yeah.

It would have been interesting for sure. Yeah, fine. Maybe not fine. It would have been interesting. Oh yeah. I, I, you know, goat nuts, but I also inject a trend. Like people were like, so is it the goat nuts or is it trend? Well, it's actually both. It's the interaction between the two. That's what the magic happens, right? Like,

Yeah. So that's, yeah. But actually, I think he's, it's a worthwhile example to pull that up because, so obviously there was a moment in time where he went super viral and then it peaked and then Derek, as a callback to earlier, ended up being the one who outed him. He exposed him, I remember. Yeah, he exposed it. Here's the thing. Liver King still makes content.

And I would imagine that he probably still makes good money. Yep. And so I would see what happened to liver King as close to a quote brand suicide moment as you can get. And yet he keeps going. And so here's the, here's the real, real, I don't think you can get canceled. And so a lot of people have this fear of making a mistake that's going to end their career. And, and,

No mistake ends your career unless you choose to end it. And so you can always get back up and keep going. The only way that you can actually get canceled is if you get prevented from distribution. So if all platforms de-platform you, if every platform did that, then yeah, you are canceled.

Right. Like R. Kelly is in jail and can't make content. He cannot make content. So like he has been he has been effectively canceled. Right. On the flip side, how many times has Chappelle been canceled? I'll put that in quotes here. Right. He's not canceled. He just keeps going. Right. And so in the same light, to further hopefully put at stake through this thing, your assumption that you have killed your career assumes that everyone in the world knows who you are and the vast majority of the world doesn't even know you exist.

nor did they really care um subtext and so like let's say you have a million person audience okay you mess up just go get another million you're not dead and if anything you start having learned a lesson and you just keep going it's interesting because like i think the poster childs for this in some ways are like jake and logan paul dude the suicide forest thing yeah like

Here he is on WWE or whatever, whatever they're doing now. I don't follow as tightly as I probably should to be, you know, in this world. But he's still around. Yeah. And he's bigger than ever. Yeah. And so like there's also Jake Paul also is a VC fund now. Yeah. Well, there you go. There are so many examples of, quote, career ending moves that didn't actually end the career. Well, you have to be able to deal with and this is the real hard part is that you have to be you have to be able to handle hate for a week because the news cycle is about a week.

And so you have to be able to just be hated.

And it's very against our human wiring to receive that much hatred and continue onward. Especially online. It's amplified. It's impossible to fathom a million people telling you that you suck. Have you gone through that yourself? Um, I mean, I've had my moments of people hating on stuff that I, that I put out. Um, usually it's just stuff that I put out that just triggers people in general. And I would say that part of it is intended to do that. Like, cause I have relatively extreme views, um, on life and death and things like that. And, um,

I make those because those are the views that helped me free myself and made life a lot more palatable for me. I've always been like, and if it helps you, use it. And if it doesn't, don't worry about it. Use whatever you're doing. This is not me trying to proselytize. This is me sharing what's worked for me. But of course, people see it and they're triggered because this conflicts with their worldview. My content is a documentary, not a sermon. When you think about the different axes of control, the different models you've said, what's interesting is

I've seen a lot of creators stay on the media emperor side. I've seen a good number of creators make money via their own products. Like obviously there's festivals. The middle area, what you've done, it's actually very, very rare. That's the advantage of if you understand the business game, you can do nasty things. Because I remember, so there's, I can't wait for this to get the callback. But one of my very first podcasts I ever did was on Ice Coffee Hour.

um with Graham Stephan and on the show uh I said if I had your size audience I would already be a billionaire

I'm excited for when we cross that because I think it'll be pretty close. You have the audience now, Alex. Is he saying put up or shut up? Yeah. I mean, we've grown a ton. I'll just leave it at that. I'll say this for anybody who's listening to this. So the problem with me claiming something, I would like to have a third party substantiate. And so like I could say, well, if you know what our revenue is, right, and you put any kind of EBITDA on that, that would be reasonable, especially in a business that has low CAC.

you would probably imagine that it would be decent. And you put any kind of multiple on that, it would be a pretty large number. And so we have things that are going for us and we've had conversations with companies that said we would value in this range. But those are things that I wouldn't, if I claim it, I want to be rock solid. Yeah, absolutely. Right. And so that's why I have it. But that being said, obviously we've grown a lot in that period of time. And

I'm excited for whenever that callback comes because he still has more YouTube people. So I'm using that as mine. You're saying we haven't quite reached your audience yet? Yeah, on YouTube. Yeah, I'm still behind his audience on YouTube. It's actually another good point that you said multiple, right? The multiple that you would get on what you've built is going to be higher than say a pure YouTuber. Yeah. Here's your question. When you look at say like what Jimmy, MrBeast has built. Yeah, perfect. I was going to come back to that. Yes. Okay. Is that a business you'd want to invest in yourself? So I think I'd probably take Chamath's angle, which is like you just, you're basically betting on Jimmy.

And I think, yeah, I would take that bet. Right. Because I think Jimmy will just die or he'll win. Yep. And that's kind of. He's obsessed. And you just want to find people like that. When your distribution base is the world, it's hard to lose. Yeah, I'll just, I'll leave it at that. But what you brought up though, like Prime, for example. Yeah. So Prime is actually the identical to a school deal.

Because he didn't build the product. It was Congo Brands. It's another company that previously worked with other creators to do other drinks as well. Yeah. And so they promoted it. Right. Right. But they put, I don't know if they put cash in. I don't know what they did. But I'm assuming they put some money in because they have the capital. Why not? To get more leverage on the ultimate dealer or joint venture. Was Logan going to learn the drink business and get brick and mortar distribution? Like maybe. But it's also the question is how much is your time worth? And I don't mean like dollars per hour or anything like that.

You absolutely can do it. And when I say time is like, how much is the next five years worth to you? Because if you can pull five years of knowledge forward and then grow for five years rather than learn for five years, then begin growing. Because if you have an audience of their size, your constraint is going to be delivery. It's not distribution. Like,

Yeah. It's not, it's not media distribution. There's a shortage of product distribution. Yeah. It's going to be product distribution. And so to, to build out the kind of infrastructure and knowledge base, uh, to satisfy the demand internationally, not just nationally, internet, cause they're in the UK too. Um,

You need deep expertise and large existing infrastructure. And so Kong already had that. And so it made sense. And so I would probably lean more towards that type of model. I'm curious, like there's me, there's Sirhan. Jimmy, I think with Feastables is the only person who's building things truly from scratch. Yeah, he's hired his own team and everything. Yeah. And I don't know if you were to ask Jimmy again today, if he could go back in time, if he would have...

Yeah. Just if he would have done it the same way. He's talking about how stressful it is. Yeah. And we can already say he launched Lunchly, right? And well, what did he do with Lunchly that he didn't do with Feastables? He didn't build it from scratch. Right. And so I think part of that is there is a desire that I totally understand as a creator slash entrepreneur to control everything and

If you look at the people who are the wealthiest in the world, almost none of them own 100% of the companies that they have made their wealth on. So you look at Jensen Huang from NVIDIA owns 4%. You look at Elon, he owns...

whatever it is whatever small percentage of tesla that he owns um and with spacex he's not the majority owner now he might have voting rights whatever that's a different different question base his own nine percent of of amazon like i go down the list warren buffett i think doesn't own more than 40 of berkshire hathaway and we could keep going and so the idea is to build something really really big in my opinion need multiple lifetimes and you can either live all of those lifetimes uh

in sequence chronologically yourself and then take a lifetime to finally learn how to do everything. Or you can get three people's lifetimes. You all start together, you divvy up the pie, and then you can build something way bigger, way faster. The longer I've been doing business, the more I value time and speed. Because also we have the assumption that these things will not change in 10 years. So maybe it does take you 10 years to learn everything. Is the moment still there? So that makes me think of two things. The first thing is for yourself,

What are the elements of business that you're most willing, like, sure, I could learn this, but do I want to spend time on this? So I approach all new things with the same perspective, which you can, you probably share with me, which is kind of the consultant's perspective. And so I started as a management consultant, which we share as background. And the way that I was taught is,

is if you want to rapidly learn something in a space and to give context on this, imagine this back in time, I'm 22 years old. I go through my security clearance. No beard, by the way. Yeah, no beard. I have, so I have to get a top secret security clearance. So I get, I passed that. Thank God, you know, I'm sweating bullets. Like, oh, what did I do in my frat days? You know, like I'm thinking this is like a huge, you know, deal with national security. So I passed that. And then I can't say which, which armed forces, but we go and do work for the defense department. And I was focused on space cyber and intelligence.

And, you know, some of the projects that I can say this that we worked on was like basically mix of assets to kill the most bad guys the most efficiently. Right. And the thing is, is that there's overlap between different armed forces for similar style of, let's just say, killing people or gathering intel on, you know.

Bad guys. How do you at 20 years, 22 years old, go and say something that's impressive and worth $4 million for a project that you're on, um, in

In four months. Right. So it's like you start now, four months from now, you have to give a presentation to two two stars and a four star general who have been doing this for their entire careers and then somehow managed to say something intelligent. So the way that they approach that problem is so the person who does a record, you know, puts the requisite out for the project. We say, who are the smartest people, you know, in around this problem? Yeah. And they give you five people.

So you go to those five people and you interview all of them. And then you say, who do you know, five people who are the smartest people around this? And you do that for over and over and over again until eventually the same names keep popping up. And then you're like, all right, I talked to John, already talked to Steve.

And basically you have, you kind of like map the neural network of expertise and then you consolidate those notes into those buckets. So you like recode them and then you distill them down and then you make a pretty slide show. That's like the very TLDR. That is what consulting is. Yeah. And if you were the 22 year old, you were the one doing all of the notes and all of the consulting. You're doing the calls, you're consolidating. Yep, 100%. And so-

So I learned a very valuable skill set there. And so I've approached every new endeavor using the same thing to answer the question, what are the things that I would say I will learn more about this or I won't? I think it depends on my first question.

my first pass. So if I get into, because there's some industries where I look at it and I'm like, this isn't that hard. Like some businesses, I'm like, this isn't as bad as I thought it was going to be. Other ones, I'm like, this is way worse than I thought it was going to be. And it's also like what problems come up and how equipped am I to solve them? So like I'll use an investment, like insurance, for example. Right. I think insurance is really interesting, largely because one of the biggest problems with insurance is cost of acquisition. It's like it's a demand constrained business. Insurance is not hard to get capital for. Like there's tons of insurance companies that will buy it.

All that to say, it's there. But I was like, oh, that's more interesting. And so when I have that like of the not now or later, like I would put insurance in one of those buckets as something that like is also regulated, but I would say lesser than banks.

And there's pretty amazing tax advantages that exist within insurance. You're picking these products that have, to your earlier point, extremely high retention. People need it. It's just people don't historically like it. And acquisition is really hard. And you're coming in and saying, well, I could help with the acquisition side. Oh, but people still don't really like it. And there's like limitations in my ability to prove that right now because some of these things are regulated. Where the magic will happen is I'll find some nugget in there, and this will just take time, that

that I'm like, we can win on this. Three ways to build a business. You can just look at what's already working and just do that for yourself. And I think that's totally fine. I think it's a wildly underestimated path. Like, you know, what business do I start? I'm like, look around, pick one. Like you can just start and then you'll learn and then you'll, you know, learn from there. The second is you have,

a strong advantage in one of either that you can acquire customers cheaper or you can deliver in a better way, right? You've got some advantage in one of those two. And if you have an advantage in one of those two, you don't really need much of an advantage in the other. The third is that you need such a strong advantage that you can overcome a deficit in the other. So like,

if you have what I would consider a true product-driven business, you could not be really ever good at acquiring customers. And by solving products so well, it becomes viral. And then you do solve your acquisition problem vis-a-vis a better product. Now, on the flip side, it's like, can you do the same thing by just having unbelievable distribution? I don't think the answer is yes. You mentioned that it's something like 20, 30% of the businesses coming to you, they make content in some way. Yeah. Do you think that those businesses...

because a lot of people talk about creator, creator kind of, are they better than those that don't grow and have Khan as part of their workflow? Really interesting question. I think it's a, it's a double-edged sword. So what makes them great also makes them risky. So they,

they will typically have very low cost to acquire customers because it's organic. And so it's just channels. Some, yeah, it's some star or whatever. I'll call it a star, right. Um, who's, who's good on camera or good in whatever format they, they advertise in. Um, so they acquire customers cheaply. Uh, the other pro is that typically if someone starts with an organic audience, uh,

They really care about product because being a creator like your media is a product in a way and so they have the right perspective on like this has to be really good or I'm gonna lose my reputation because the whole an organic brand is built on reputation and so I think they're more obsessive about product. So I think that's a huge plus the the downsides for the business obviously is that they have massive key man risk. So now I think where you get really smart about it is

if you can gain enough influence where you can develop an affiliate network, um, a business is like somebody who's done really well is, um, Derek from, uh, Derek more plates, more dates, uh, the fitness guy. Um, he,

He has, I think, an affiliate base of four or five thousand affiliates that promote his fitness products. And so he's become such an authority that people are willing to say, well, I don't want to remake what he's made. I'll just promote his stuff. And I think he has a good, you know, a good program there. And so he is he's paying down his key man risk by getting larger and larger percentage of the business. And so I think that the way to really scale an organic creator business is

is you launch it with the personal brand. And then over time, you backfill with other faces that you have to approve. And that's the key part. You have to approve that are on brand with your values and your message and are authentic to the product that you have and are attracting the audiences that you want to go after. And then they, over time, become bigger than you. And you kind of like Homer Simpson into the...

into the bushes. Oh yeah, you recede. Yeah, exactly. Yeah, exactly. And you recede into the bushes until eventually people associate you with the brand, but the brand outgrows you. It's fascinating because, well, two questions immediately come to mind. The first is, on KeyManner, this is what you and Layla have. Are you thinking about bringing a roster of folks to Solito for the faces of even the condo side of your business? So, two answers. First,

We're not planning on selling acquisition on any time price, and that's useful. And so I see Elon as key man to SpaceX and Tesla. And so what? If you have the desire to exit a business, then key man risk becomes a problem. If you want to go public or you want to hold...

It's really who cares. And so it's kind of a who cares issue. That being said, the second answer is yes, because I do like having fewer single points of failure in general. So despite the fact that I don't think we necessarily would need it, I still like to build businesses that way in general. And we have plans for what we're going to do over the next probably 24 months and beyond to build out ACQ's brand.

MARK MANDEL: Makes sense. Yeah, the second question I had related to that was, when I look at creators in the space who've successfully executed on this, it's actually very minimal. MARK MIRCHANDANI: Yeah. I can tell you one who I look at. MARK MIRCHANDANI: Who?

So he's brought in George. He's brought in other people under him. He's got Rachel, who's his daughter, but like he's got Rachel. Um, he's got John. Um, he's got, um, yeah, he's got nine, I think channels, for example, just on YouTube that are associated with the primary. And what's interesting is that they basically run the same playbook. Um, it's daily calling show and clips and full episodes, uh,

Basically are are the channel and so they clip each episode into like four or five ten minute clips And they put each of those out So that's like that gives them tons of good like mid-length clips They get the one full episodes and then short clips get taken and become shorts. I study Ramsey a lot one because I like Dave but secondly because the amount of creators that get quote creator burnout is a

really high. Yeah. Or we're talking like Shelby Church, right? She's just kind of shifted to, I would say, a sustainable content model. Right. But it's it doesn't really acquire new viewership anymore. Like you only care about a vlog if you care about the person. Yeah. It's you're maintaining or some creators grow you on YouTube. Now they shift to a podcast. Right. Yeah. And it's because it's a quote easier format, but it doesn't really grow the audience. It just kind of like maintains the audience that you have. And again, to be clear, nothing wrong with that. Totally. But I look at somebody like Dave and I think,

he's been making content for 40 years. Like there's something to be learned from that. And I think the nature of why his content has been so interesting is because you have, he has two types of variety or three really, and that I think have to be present. So what are, what are the types of shows that have, uh, and I already say shows that have existed for a long time. You look at the daily show, right? You look at the, the night, the nightly host shows like those can go for 20 years, right? What makes that unique? And,

in my opinion, you have three variables. You have the people who are on the show, you have the subject matter, and you have, actually, it's just that. Two. Yeah, I was thinking because you also have the interviewer. Right, format as well. Yeah, so I'll still say the third, which is the interviewer, comma, errs. So like, there are some shows where they will rotate

10 people through three seats who are doing the interviewing of other people about dynamic topics. And so you need some level of novelty, I think, to consistently, one, engage your existing audience, but also to bring in new people. And I think that a lot of creator content on a long enough time horizon becomes the news. Like they say all the things they wanted to say about personal finance or how to build a house or like, and then at some point they're like, I don't know what else to talk about. And then they're like,

The news. And I don't necessarily think that's a bad thing. It just like, I just, it's just a pattern that I've seen over and over again. Because if you have single person, they only have topic as their variety. And so once you've exhausted many of the, I would call it standard direct to camera topics, then the novelty comes from news, which is literally novelty, right? What is new? And so that's where they allow the environment to create their content or other topics. Going back to Ramsey, he has guests on. He has guests

call-ins, which create endless variety. And so those are kind of like the two formats. And he doesn't have to prepare really ahead of time. And so he is, if he does three hours of content a day, he's generating three hours of content. Whereas I would say many creators will spend 20 hours on generating one hour of

of content. And so he has pretty decent leverage on his time in terms of output per unit of time spent on content itself. And if you want to grow a business around it, you can't just do content because then you have like, when do you, when do you grow the business? It's a really interesting point because you mentioned that a lot of creators start with one thing and then they eventually burn out and build a scalability. Like Graham, Stefan's a good mutual friend of ours. And Graham has openly talked about how he is getting really tired. Yeah.

on his main channel. He said that like three years ago. Yeah, I've noticed Graham every year talks about, and even when I met him, he was doing like three videos a week and you just run out of topics and to your point, you just become a news reactor and that's not something he enjoys as much as doing. And in a way, he's found a lot of success now with his podcast channel, but for a while, like he spun up a coffee business. Yeah. And he's also talked about how the coffee business didn't work. Yeah.

And so I think it's interesting because on the one hand, everybody's like, well, acquisition is one of the most important things to a business. If you're a creator, you're going to succeed. On the other hand, hey, Graham did the coffee business, didn't necessarily work. Emma Chamberlain's talked about how Chamberlain Coffee Line also doesn't apparently make money. There are many creators who go to the business path and it seems like, well, maybe that was not the right play. So two really interesting things about this. Well, Graham specifically, and then also in general. So, yeah.

I think we need to be very careful about what audience we want to gather. And so Graham's audience has been predominantly people who don't want to spend money.

Yes. Frugal. And so he gathered everybody together who don't want to spend money and then was like, Hey, spend some money. And so I think, I think in some ways it's hard. It's almost harder for him to sell something that almost anybody else, right. Because of the nature of his brand specifically. That's why I think like for him, it's like doing media stuff in some ways is probably an easier, he can sell to advertisers and you can, they can have the good luck, you know, but I think for him, like,

something that would have been on brand would have been like honey, right? Before the, the, the Lord, yeah, before the scandal, right? But pre-scandal honey, I think would have been very on brand for him to offer. Yeah. And he could have made a lot of money on that. And so I think all discount related things or discount related financial services probably would have been good angles for him. So that's thing one. I think two is, so I guess that, sorry, I was getting into thing two, which is picking the right product. Right.

So you have right audience, right product. And so I think that having the saving money audience, you can make money from it, but getting them to buy something that would be considered frivolous, which is just like coffee. Now you can try and position it as like, okay, it's not Starbucks, fine. But now you're literally dealing with a commodity. Like coffee beans are traded as a commodity. Like very hard to be, to have alpha from a brand perspective when the whole brand has been built on don't buy. Like this stuff comes off the same factory floor as this stuff and they just put a markup on it, right? And so from a product perspective, I actually think creators are,

horrendously bad at picking products. Like the amount of conversations I've had with creators who are like, hey, I'm thinking about launching an X and I'm like, what?

what? So on one hand, I like, these are real conversations I've had where they're like, yeah, you know, I read Peter Thiel's zero to one and I think I have to create like a totally new category. Yeah. Monopolize. Yeah. And I'm like, dude, you already, your, your monopoly is the attention. You can sell a commodity. And as long as it's on brand, you know, like with, with, with you, you'll probably be able to do really well. The follow-up question is, will you do as well as you could have otherwise done if you picked a better product, which then goes into kind of like circling all the way back to acquisition.com in terms of what we do is we're,

I only really solve for revenue retention. It's like really the only thing I care about. 'Cause on a long enough time horizon, anything that retains customers becomes huge.

If you know how to advertise at all, which if you're a creator, you do. And if you can keep the customers, then on a long enough time horizon, you build a massive company. It surprised me you said retention instead of growth, actually. Well, like level one, like keep customers. Level two, grow those customers too and get them to bring more. But yes. And so from a product perspective, though, I don't think enough of them are thinking about reoccurring and recurring revenue. And my two cents for anybody who's a creator who's listening to this, do not try and solve...

churn, try and find products that people already don't churn out of and then make it your own. I spent a huge amount of my career banging my head against the wall, trying to figure out how to make something that people inherently leave

like a gym membership, something that's sticky. And I've learned a ton. And so there's lots of what I would consider like blocking and tackling tactics that I have learned that will improve churn. But to conquer churn, like how many of you have churned out of your internet lately? How many of you have churned out of your cell phone bill? How many of you have churned out of your insurance? Your bank account for that matter. Yeah, exactly.

You hate them and you're still with them. Of course. And so you think about these products. And so I would rather find products that people already don't leave and have no affinity for and then try and just shift them over. And now you're like, wait, how can, well, aren't they technically turning out of them? Yeah, but I'm being laser targeted in how like.

Yes, that's the point. That's the advantage that you have as a creator is that you can bring those people over from what is otherwise a commoditized product that they don't care much about, but still pay for rather than trying getting people to care about your product in order to buy it. You might remember 2021. Everyone is really excited about the creator economy. Everyone knows it's going to be the biggest thing in the world. One, because COVID. Everyone's at home. They're watching online videos. And two, because TikTok.

short forms going on the scene everyone's getting millions of followers and then 2022 2023 there actually was a bust where a lot of people were like oh creator economy is not going to be a thing and it's because people weren't able to monetize they have all these short form followers they didn't really see i have really strong views on this oh yeah what are you thinking so i think it's because the people who are allocating money didn't understand media at this level like i i would i would wager that you and i probably understand the creator world and media

better than most. And I think that fortunately, unfortunately, I think short form content does not build tremendous influence. Right. I think you bring awareness. But if we think about influence in terms of like what percentage likelihood can we get the audience of this person to purchase something? You just need. Okay. So four elements for influence.

So you've got likeness. So does this person look the way that I look? So because of that, I will trust them more and be more likely to follow their directions. The second is credibility, which is say-do correspondence, which is basically does this person have evidence or proof that what they say is true? Third is you have power.

And power comes from someone doing some directive that you have stated and then yielding a positive consequence from it. And so I'll give an example of this. So Huberman made a short about if you have hiccups, how to stop having hiccups. And I remember watching it and being like, well, I don't have hiccups right now, but I'll try to remember this when I have hiccups. And about a month later, I had the hiccups. You followed it. There's power in what you said. And then I did the thing and the hiccups stopped. And so in that moment,

gained influence over me. I am more likely to follow a directive in the future. And so status is the fourth thing that gives you influence, which is relative control over reinforcers. Meaning, if I am a bartender and I control a scarce resource, which is alcohol, I have status in this setting. Mm.

Because I control the things that reinforce. Does it matter how rich or powerful you are? I'm the bartender. In this setting, I control what's scarce. Right. And so if you were a billionaire, you control money. And so you gain status just from that. Presidents and politicians also have status because they control resources of the government. Right. But they still control resources. And so women have status because they control a scarce resource for men.

Just being real. And so they can influence behavior. And so all of those things increase the likelihood that you get adherence or compliance from a request. And so if you have all four, then you're incredibly influential. And big picture, our goal as creators is to gain actual influence so that we can influence the behavior of a large group of people. And the way to do that

most powerfully is to give them something, some sort of directive that they follow and their life gets better. And then they're more likely to adhere to a follow-up request. That makes sense. So if that's the case,

It's very difficult for you to do that well with very short content. And so to put this in context, let's say that somebody has consumed 20 YouTube videos of mine. And let's say that those videos on average were 30 minutes. All right. So that's 10 hours of content that they've consumed from me.

Okay. Right. Let's do the math here. If the average short that I put out is, let's say 20 seconds. Okay. So if we have 20 seconds for a short, that means it's three shorts per minute. So 10 hours times 60, we have 600 minutes is what my longs were. Yep. And we'd have to triple that. So they would have to consume 1800 shorts of mine. God. Right.

And so I think that what's happened is that people have wildly over leveraged followership and views for influence. What's interesting is that like small businesses, I remember Michael showed me this actually, he saw this little cue card. He took a picture of it from like a car detailing business or something. And they said for 400,000 views on TikTok,

or 10,000 views on YouTube, $500. So any creator who wants to make something about their car detailing organically, they'll pay them $500 if they get 10,000 views on YouTube or 400,000 views on TikTok. So they had already basically appropriated that as 40X is the equivalent

amount of influence. And if it were me, I still would probably rather have the 10,000 views on YouTube. If we're looking at this, what's her name? The dancing girl, Charlie D'Amelio, right? So I think she's had a couple of things that didn't work as well that like, and again, it's if I make a brand built around slapping strangers in public, right? Just as a complete extreme.

And then I launch a credit card. Does that really carry? There's no say-do correspondence. I have no proof, right? So I have no proof that... She actually did partner with a credit card company, by the way. Right. And I think she had a popcorn. And to be clear, there's no shade here. That's not my point here. My point is to help creators monetize. And so I see the point of short form as one thing.

which is to drive them to long form. Or if you can, obviously deliver some sort of value like I got from Huberman in that short clip. But the thing is, is that the likelihood that that occurs is really, really low. I have a pretty decent memory and I remembered a short from a month earlier and then actually did it and got a result. Super unlikely.

Now, if you listen to Huberman on a daily basis, for example, he probably gives 80 directives over his every podcast. And all you have to do if you're a long-form listener is listen to one of them over...

a month and your life gets better and he gains influence. And so when he then makes a product recommendation, I'll bet you that the Huberman collabs have probably crushed. Athletic Greens. Yeah. And he's got broke. He's got the sunglasses thing. I think he's promoting David bars, which is actually high protein. Yeah. So like,

And those collabs, I think, have probably gone pretty well. And Rogan also, to the same degree, when he makes recommendations, a huge amount of people, including presidential recommendations, a huge amount of people follow. And this is where it gets really fucking interesting. So again, it's all of those elements. So if you have a, let's say somebody who's a long-form host, doesn't talk about politics at all, shows no knowledge of the stuff, has a big audience, brings somebody on, their endorsement

probably matters little. If their audience pays attention to a political candidate, then that's basically just functions as an ad and the political candidate is doing the influencing on their behalf.

But for their endorsement to matter, not just the distribution, they have to have demonstrated some credibility around the topic so that people say, this guy is informed. The value to be other than you've reached a million people or whatever. Right. Joe has done a ton of political stuff and like it, don't like it, whatever. He's demonstrated that he's at least spent a lot of time trying to research the topics with the intention of just trying to find truth from an independent perspective. I'm not getting into like the weeds on either side here, but just that, that has been the intention. And so-

he is tremendous influence because most people think, at least I think most consumers think this way, I don't want to do all that work. I'll just trust him. See, what's fascinating, you describe the primary function of short form to drive to long form because you go to a broader point. You're saying that people had followers, but they didn't have influence because influence comes from the four things you just described, likeness, credibility, power, status. Initially, what was going through my mind was, yes, 2020, 2023 saw a bust because a lot of investors confused in

influence with followers. Yes. Because there were more followers brought in because it's in short form. Yes, totally. But nothing else. The initial premise I was operating was in 2025, which now I'm rethinking was, oh, but now people have figured out how to use short form to upsell to products and services, whether on school or, yeah, or,

or these other 15 different monetization methods where the short form units are just becoming really marketing creatives. And we're still the best one. I mean, it is the best one. Well said. Well said. The premise for me was, oh, now short form, it's actually just marketing. Like they're just like commercials. And so the monetization is coming back. The short form is not really successful in growing your influence, but it is successful just from a distribution POV. Think of it as like awareness ads. Yep.

And so what happens is the objective, in my opinion, so like the ones you like school, for example, if you're a short form person, it's like, how can I just get them to take the tiniest amount of action, which is to go into a community where I can get way more interactions with them on a much faster feedback loop so that I can gain the other three or four more like harder. Right. Right.

But what's interesting is like the people who I think are doing really well monetization right now for TikTok are doing TikTok shop plus lives. Yes. And what's alive? Well, I think there were some creators that were still wildly undervalued. Yeah. And many that were wildly overvalued. And...

This is the, you know, the classic story of like, I had two people that I paid 100,000, you know, I had 100,000 followers on Instagram, and I had both of them do a shout out for my thing. And one guy drove 10,000 customers and one guy drove zero.

how is now assuming it's not bots, but like there's definitely legitimate creator accounts that have a hundred thousand followers that have zero influence. Do you think more businesses should be trying to follow content creator led models? Like we've talked a lot about, Hey, there's five different ways these businesses make money. Here's some of the challenges they have. Should the other, you know, 60% of entrepreneurs come to you be thinking about, Oh, I should be incorporating content more into what I do. I have super strong reservations with the word should in general. Um,

I would say really just depends on what the constraint of the business is. And so like, let's say you have an outbound channel that you have cold callers and cold emailers that, you know, generate B2B customers for you. Do you need to start making content?

Probably not. And given the resources required, are there, is there something else in the business that would generate more enterprise value? Yeah. If so, then you should do that. Right. Big picture, more attention in general tends to grow businesses provided they are not supply constrained. But that's a big asterisk. Many businesses are supply constrained. There's a lot of plumbers who the phone's ringing on the hook and they're like, I just need more plumbers, dude. Like I like, yeah, of course. Like I could, we can like,

I don't have a problem getting people. If you have a cleaning business, the problem is not getting people to want cleaning. The problem is finding cleaners. Yeah. Right. So like it depends on what the problem of the business is. Now, if that were the issue, do you make content around like what it's like to be a cleaner so that you attract cleaners, people who want to clean? It's like, hey, you already clean your house all the time. Want to do it for money? And we have better working conditions, blah, blah, blah. Like fundamentally, I guess reframing the question as should the other 60 percent of businesses add another advertising channel?

- No, unless it's the contrarian of the business. - When you think about what you're investing for Acquisition.com or now for ACQ Ventures, it sounds like traditionally it started from let me bring you better business processes. With school, it actually shifted a bit to I can just bring you tremendous distribution via my own content.

What types of companies were you leaning more toward investing? Once they help with the processes or ones where you think the content distribution actually is what matters. So I'll say that it's both. Right. And I still use those three kind of legs of the stool. So I got money, we've got time or work, and then we've got brand reputation, distribution, et cetera. I prefer to do as many as I can of the first two because in a lot of ways, brand is so much more limited. Not limited.

limited in its power, but limited in how many. And maybe this could be a limiting belief for me, but I don't think it is. I think it's very... So brand is built on associations and pairings. And if you...

Pair yourself with too many things, the brand starts to lose its potency because you have associated with too many disparate things. Now, if you made many associations with things in the similar buckets, I think you could get more bullets. Right, that's more okay. More shots on goal, if you will. But no, I try to basically do the more scalable things, which money is actually pretty scalable. We've developed a pretty exceptional team at the holding company for acquisition.com, which

Because I basically take, I marry a lot of old school and new school. So we have a lot of young, call it five and 10 year McKinsey, you know, Bain consultants that will pull who are like, I hate feeling like a cog in a machine and just doing billable hours, but are otherwise incredibly hardworking, incredibly bright.

And also see the problem with a lot of antiquated businesses and want to work with more new, more cutting edge stuff. And also really like, and a lot of them came from, you know, my content, my world, and want to marry, I would say,

big business strategy with small business tactics, and then kind of like bridge those two gaps together. And that's a lot of what we do at ACQ anyways. And so I think they really enjoy it because they learn a ton from the frameworks that we have for growing companies. It adds nuance and texture to their existing knowledge set from what they learned at the kind of like big consulting firms. And just to put context to this, like,

If you're looking at like supply chain for Walmart Brazil, right. Or something, you know, Walmart Latam, uh, because you need to do some analysis for that. Super heady, uh, really complex, lots of moving parts and not useful to a small business. Like,

really valuable to a big business, which is why they pay the money for it. Not useful at all to a small business. But the thinking process and the reason I like taking people from that world, one is because I came from it, but also because I think at the end of the day, consultants are a lot like engineers in that you just have to solve problems. And being able to have a really good problem thinking mind is I think what makes a good consultant in general. And so that feeds really well into the advisory practice. Would you invest in content creators? I would if I... Like, okay.

Let me clarify, qualify the answer. So are you saying invest in them like if I could buy a stock in a person or like if, hey, I want to start it, I want to start this umbrella company? I was thinking initially the second. I probably wouldn't for a de novo idea for a couple reasons. One is like I don't really like...

seed stuff like idea stuff right also because creators are typically like big idea people that's not the constraint the constraint for them is execution um and business acumen and for a deal structure like that to like in a traditional structure i probably wouldn't have majority controller ownership and so that would be really high risk i think and so i probably wouldn't like that deal if it was a deal that was kind of like the opposite where like

maybe they owned like 20% and we owned 80 and we fronted the capital and we like put all the stuff together. Sometimes you're incubating them. Yeah, maybe. Yeah. But even then it's like, I also have to look at supply demand of like my own deal flow. Right. And to do that, it would have to prove that that

deal structure provides more alpha than the existing thing which i would have a hard time believing what about a later stage creator company like the primes of the world yeah so like a logan paul or like whatever jake paul or something who's not him but somebody else right it would be tough and the main reason is investing in in someone like that isn't really investing it's a joint venture and then it's really like so i'm starting another business

And that's really what it would be. And so it would have to be a business that I felt

the existing resources and assets that we had, we already had a huge percentage of the core competencies required, not just in knowledge, but like in manpower. Yeah. To do it. Makes sense. Because for you, you're either, obviously you're bringing capital money, but you're also either bringing your image and likeness, which is distribution, or you're bringing the operational expertise. You're working with these businesses that are less savvy on the distribution side, clearly something of value. You're working with these creators. Well, you have

you don't necessarily need theirs. And they don't have the operations side, which means you have to spend tons of time building. Tons. They don't have any. Right. And so we'd have to build a company. And so that's where I see that as like translating the ultimate question to like, would you build a company for a creator? If that's what I translated into, then the answer is,

Probably not. Right. Just given the, like how much it would take. When I was chatting with Michael earlier today, he did say you've been shifting more to investing. And we briefly mentioned- ACQ Ventures is all capital. Yeah, ACQ Ventures. And from my understanding, that's much earlier stage. What prompted that actually? Honestly, just we had so much deal flow for it.

So a lot of people were coming in and saying, hey, I would say it is largely tech. Because it's venture. You need to have really, really potential big exit outcomes. Yeah, just the economics lend themselves to tech. But we had a lot of people were coming towards us in, I would say, like a couple buckets. So bucket one is somebody who's already raised some round, consumes all my stuff.

it helped them grow and they're like i would just rather have you on our cap table than somebody else and that's like perfect scenario right like they already they they like the stuff they're using they kind of like subscribed our ideology we can provide capital help them grow because we believe in the thesis so like that's great and those the thing is is that the existing model that we had prior to that required us to have a significantly larger equity position right to justify

uh the return right but because some of these tech companies can have uh significantly larger exits and because they don't require more work right uh we can take smaller slugs and do um

and just do money only essentially so that's so that was that was kind of bucket one bucket two is people who don't have a cap table at all um there may be bootstraps but they still want to take on some clear opportunity that we can help fund um and those also uh you know as long as the deal structure makes sense like those can make a lot of sense the nice thing with that is that they require

almost no work and expertise. And so it's really just like these entrepreneurs are like, I'm not trying to exit. I'm not trying to have a growth partner. I need capital and I prefer your capital to somebody else's. And we basically had so much of that. They were like, we should probably just spin this up. And the check sizes are not that big. And so I don't even really need to raise a fund to do it. Like I can just do it on my own. Yeah, exactly. So that's worked out really well. We've already done like

I want to say like six or eight deals. Oh, wow. Yeah. Yeah. I know. Just in the last like two months. So like it's, it's heating up really pretty quickly, which is great. Or I'll just lose my ass and we'll find out. But like, yeah, I've deployed a lot of money. Like congratulations, you know, cause it's funny cause in the investing worlds for these that don't know this, uh, in a fund structure, you basically are incentivized to deploy capital. Yeah. Uh, to put out money. Yeah. So it's kind of interesting because like the traditional, like clapping of hands that happens when it's

All your money? Yeah. It's actually like, well, I took a lot of swings. We'll see. You don't really have LPs. You're LPs yourself. That's why. So cool. I've spent all my money. Yeah, right. Amazing. Yeah.

Yeah, I mean, fundamentally, we operate 100% like a private equity group. And obviously the fund, the ACQ Ventures operates like a VC. Like we have basically a general partner who just basically runs that, came from the Y Combinator world, like has a really good deal flow on his own. Yeah, he sources a bunch of deals on his own outside of our network too. Which you'll probably notice this is a common theme is like, I want stuff that already works and that I can put gasoline on rather than

It can only work because of me. School is an exceptional product and was compounding month over month with zero advertising on its own.

Then we added gas. If it only if it requires me in order to work, then it requires me to work until I die. That's not fun. And so just as like a side note for the creators, like everything that I again, this keeps coming back to this point, but like I solve for revenue retention. Because if if you go on vacation, the company dies, you just bought yourself a higher leverage income, but you did not buy yourself a business, right? And it's not an asset.

It's literally only valuable to you and not valuable to everyone else. And the valuable to everyone else part is where you get significant outsized returns in terms of wealth creation. When you started to make content, before, in your previous businesses, you hadn't really gone hard on content marketing. And so was the motivation because you saw this as good lead generation for acquisition.com or was it more, hey, it's time for me to share what I've learned? I would say, one, there was multiple motivations. Yeah. And I was actually pretty...

uh reluctant to do this and i i don't even know if i will do it forever i think some people were like i'm gonna do this like i don't know if i'll do it forever i came in with a very clear purpose of why i was going to do this so i'll tell you that the the stories that just got me to decide to do it and then why so um in very short order uh the rock had taramana

for multiple billions. Huda Beauty did a minority deal, you know, valuing the company over 600 million. Conor McGregor, same thing, 600, ironically, 600 million for proper 12, his whiskey company. So those were like some celebrity examples. Then I had, I remember hearing this podcast of this guy named, he did Nomad Capitalist. He's like a YouTuber and he talks about expatriating and like how to have tax savings and things like that. I,

had seen his channel and I listened to a podcast and he said, I get 3000 applications a month. And I went to go look at the application and it was like, it was an application. It was like 30 something questions and they weren't like multiple choice. They were like very in-depth questions for financials and like, oh, and like you had to upload documents and like, there was a lot of stuff involved. And I thought to myself, if I had 3000 applications a month for any business that was high end B2B, my God, I would just print money.

And so I thought about that and I was like, okay, so these, these were like, I'm getting warmer and warmer to this idea. And then Kylie Jenner gets on the cover of Forbes as a billionaire at age 20, which they ended up disproving later, but like, doesn't matter. Right. I think she is a billionaire now. Uh, but she was 20. I was 27. I thought I was hot shit. She's seven years younger and she's a chick and she's richer. And I was like, I suck. I'm a big believer in like, if somebody is making more money than you, there's something you can learn from them, uh, in the game of business. Totally. And,

And it might just be like, you need to be luckier. But like sometimes it's like you need to be the right place at the right time. So it's like, okay, well, what do I do about that? It's like, okay, well, I try to increase my surface area of luck. Then I decided I was going to do it. And so when acquisition.com for sure was what I was going to do, the brand part wasn't something I was for sure going to do. But when I thought, okay, how can I decrease the likelihood of failure as much as possible? Like one of the tenants would be like, well, if you had an investment firm and you had unlimited deal flow of people who only wanted to do business with you, it would make it very hard to fail.

And so I wouldn't have to be the best negotiator. I wouldn't have to be the best picker of companies. I could just have unlimited shots on goal. And so it's like, okay, so if I were to solve for that, what would I do? And I said, well, if I could build the biggest business brand, then that would basically shrink into irrelevance or make, sorry, shrink all of my problems or make them irrelevant by consequence. That was fundamentally why I decided to do

You mentioned in the beginning, you weren't even sure you wanted to do it. Do you enjoy having over a million followers now in that piece of accomplished? There are pros and there are cons. And right now there are more pros than cons. And if there's a day where I feel like there are more cons than pros, I will stop. Right. I think there are some people who really love attention and...

love, fame, and things like that. I don't think I am that person. And I feel like I have evidence to support that because I didn't do it for a long time when I think I had the opportunity to. Right now, my content feeds thousands of families.

First from obviously what we do at acquisition.com, the holding company, but then also all of the, you know, school, like there's, there's, you know, from a distributed perspective, if I were to quit in the future, I would try to make sure that I had backfilled my responsibility to those families to make sure that, that, that vacuum, you know, didn't, that it was filled. The pros of this are you have recruiting talent becomes infinitely easier. The best people in the world at whatever they do.

which is such a such an underrated lever like i just can't i can't overstate this who is is lever number one number number two is you have the obvious thing is that you have lots of deal flow or customer flow depending on whatever you know whatever you whatever you sell those are really the big pros you have some ancillary pros like you know if i go to a gym and drop in like they usually know how i am and they'll give me some nicer treatment and if i go to a restaurant they probably know who i am and they'll they'll you know be nice about it um

Those aren't super... Some people like that. The downsides are that what you sell is privacy. And so that's the price that you give them. Privacy is the price. And one of the really tough parts and why I spent so much time thinking about this was that it's kind of a one-way door. You can't undo it. There's no control Z. Alex, thanks so much for making time. That's a wrap. 100%.