Doug Demuro on Analyzing the Car Industry, Creator-Led Businesses, and Porsche Episode Follow Up

27:49It didn't matter. Did the manufacturers wise up to this and try to raise invoice and say, like, oh, we should split some of this margin. They tried and on some vehicles they were able to, but it was difficult to move that quickly for the automakers. At the end of the day, the automakers have these dealer agreements in place with dealers that have more power than people realize. The dealers are in large part private businesses that can set their own prices wherever they wish. And so the automakers were kind of at a loss. They kind of just had to do whatever they had kept doing. Plus, the other fear the automakers I think had was, if we raised the invoice price this year, what happens when we're in an oversupply situation then the dealers don't want the cars again.

28:26It's very hard to dial it back. Tesla's direct sales model makes it easier to kind of screw with pricing throughout the year, but the automakers don't have that luxury quite as much. And so the dealers made all that money. And they were charging over, I mean, say they were selling Broncos for 20, 30 ,000 over sticker. That was like a common thing. These dealers have been living incredibly large over the last couple of years. And frankly, people have been very angry about this. Like all these dealers are making so much money. They're trying to screw everybody, but the truth of the matter is this was their chance.

28:52Like dealers in 09, no one was complaining when supply and demand was working in their favor. Like when they walked into a dealer and dealers were begging people to take anything at invoice, well suddenly supply and demand is suddenly made a little turn. And it's not working in the favor of the customer anymore. Now they're all in that. In general, being a car dealer doesn't strike me as like a great business. It's a tough business. I think they make good money, but it's also enormously employee heavy, enormously regulation heavy. You need a large space. You have to hold a lot of money in inventory and you're foreplaining that they call it, they're paying interest on all those cars.

29:26Like the opposite of a Costco. Yeah, that's right. It is the opposite of a Costco. It is expensive, difficult, et cetera. Is it like a lumber yard? I remember meeting someone who owned a lumber yard at one point and I was asking all these questions about financial planning for the future when you're a small business owner. Like how does that work? And I was like, how do you think about retirement? And he just like looked out at the lumber yard and he was like, that's it. Like all that lumber. Like I got $8 million in inventory out there on the lot. And like at some point I'll just sell all that.

29:54And then I'll retire. I got these dealers, especially I would assume luxury dealers like a BMW dealer or Mercedes or you know, Porsche might be a little different, but you've got dozens, maybe hundreds of millions of inventory sitting on the whole. And they don't own it. They all finance all that. And so it's really a casual business. I think in some senses like they're just trying to move stuff. And unlike lumber, I assume cars have model years. So there's a push. They got to get these things out the door. They can't have them for all that long. It's like a high pressure business. Everybody I know in the car dealership industry is divorced some many times.

30:22It's like a lot of work on Saturdays and Sundays, a lot of push and hard to get deals done at the end of the month. I remember, I don't know if I should tell the stories. Probably true of a lot of auto makers. I remember when I was working at Porsche and we were down to our last couple sales trying to hit a goal at the end of the month. You know, we were in Atlanta, we were headquartered in Atlanta and we would call the dealer in Hawaii, like 8 p .m. the last day of the month. They were the only ones still open. Can you punch? Can you punch a couple of cars? Like you do that stuff. That was just kind of the way it's a difficult business.

30:52Wow. So here you come along in the middle of all this with a used car, like you can't design this any vet. Literally, I don't think you are a clown in a clown car, but like you drove into a goldmock. Yeah. Yeah. This is a historic confluence of events. Let's stop oversimplifying this thing. Like you can be a savvy business person and also basically no human can time the market. And so like it was a pretty reasonably good idea, especially given the fact that you had distribution, but you had no idea the tailwind. Right. That's exactly right. Period. There's no other way to put it. That's exactly right.

31:29We got lucky. We didn't know the tailwind. We made a great business. You know, it's like that famous saying, the hard I worked the luckier I get. We've set ourselves up for success. And then we got additional help from the car market. Well, I guess too. I mean, other people must have started companies and they were bring a trailer. There were existing players out there too. It is a testament to your savvy and hard work and everything that like to my eyes at least it appears like most of this opportunity that got created, you captured more than your fair share of it relative to compact. That's right.

32:01And you know, going back again, not that this is like a trope of mine, but it's something that's coming up. The people underestimating the a lot of other people tried to start one of these businesses. You'd be shocked. Like you guys aren't obviously paying as close attention to this as I am and as our team is, but I would say 30 other online car auction sites popped up in the last couple of years and 29 of them have failed or 27 and the other three are barely hanging. You know, it's that kind of thing. And they saw a dog and they were like, if this idiot can do it. And so they tried and I with this idiot with all the distribution to all the people who want to buy and sell all these cars.

32:34Some of them were other content creators honestly. They weren't willing to spend the money up front to create a great website, which I think was crucial or they didn't have as large of a following or they just thought it would, they'd roll the dice and it would take off because the car market was strong. It wasn't as easy as it seemed, but yes, you know, we showed up, we had all the people already there. Bring a trailer has been enormously successful because they built their audience over a long period of time and then transitioned into auctions and that's been great. For us, we launched and then had a built -in audience because I had built my audience over a long period of time.

33:06Other people who just want to like try this, it's not quite as easy. Big names have tried it. Porsche has a business right now, an auction business called Marked that they're running from Porsche Digital and it's fledgling to say the least. And I think that they and others have learned that you can't just throw money at trying to get an audience. It's not that easy. And having an audience where people love the dude who's at the top and are fans and want to be a part of his business, that makes it even easier to like convert them to real traffic as opposed to just some business going out and spending a lot of money on advertising and trying to buy audience.

33:39I'm imagining, though, and I've heard you talk about this in Collins, MIR, and elsewhere too. That part was certainly easier for you than competitors. However, there are a lot of other elements to this business that were probably just as hard for you. Like listeners, viewers, think through with the logistics of this for a minute. You've got other people that you don't control, buying and selling incredibly valuable assets with a lot of money. Use car transactions known to be potentially fraught with confidence. How do you make that a smooth experience? Yeah, no, and that was hard. And the other really great and lucky thing that happened that I don't talk about a lot on podcasts because it's more difficult to discuss, but I had a business partner who was unbelievable without him at what kind of work.

34:25I say it's very difficult to discuss because I can't bring them on. I hear you, but I came with the audience and the idea and the top of funnel, the ability to bring people. And he came with like a knowledge of how this business needed to operate in order to work. And he kind of saw through what we're going to be the challenges and that sort of thing. Which is crazy because he had never been in the car space before the auction space, to the marketplace space and he was just able to figure it out. So between the two of us, we had it all. And when you said he was the, he had this skill, like what, how do you build websites before you already build?

34:52Yeah, that's right. He had had some experience building websites and other like startup type businesses and products. So he kind of knew in a startup world like what was going to be the stuff that was going to be challenging. I had worked at dealerships before and for an auto maker before and so I had an idea in the car sense of what was going to be challenging. And we were both car enthusiasts who had done transactions on bringing a trailer before. We had the whole concept kind of down. It was like a pretty good way to start this if you're going to start it. And so we started hiring employees.

35:18And you know, it's funny because one of the things, we'll maybe get into this. But one of the things you mentioned is hey, we should talk through some, like things that people don't realize about the business or whatever. One of the biggest is your audience will realize this but a lot of my audience and general audience doesn't. We launched this business. We had 10 employees or something like that. I mean, and now it's grown considerably. There's still a large contingent of people who believe that every dollar made by the business goes directly into my pocket. And this is incredibly annoying to me.

35:45They're like, oh, Doug made 30 grand a day, Doug made 50 grand a day. And it's like, yeah, I know we're paying all these employees for Christ's sake. But I think a lot of people actually thought I just did this by myself, but I didn't. But part of the magic of why it worked is the perception that you built it. Yeah, maybe that's probably true. It's like this is Doug's website, which I always kind of grimace at because every leader of a business always like it couldn't have been possible without my team. But in this case, it literally couldn't have been, I don't know how to do this. I make YouTube videos as a profession.

36:14I don't know how to make a website. Like that's just not. And Dr. Dre doesn't know how to make headphones, but you better believe people bought those because they were beats by Dre, not beats by Jimmy. That's exactly right. And the massive team behind Jimmy. That's exactly right. And so Dre looks like he's the brilliant guy. But you know, there's the whole thing there. And that's the case for us too. We had a good team. We had support people in place. I think that was one of the biggest things, David, you mentioned like the difficulty of these transactions. Yeah, and we kind of knew that was going to be an issue.

36:38And so we've like really doubled down on like support as part of it, having people direct people to call and deal with if you have issues or whatever. And I think that that makes the transaction a little bit less fraught with like, oh, we're worried this is going to fail or something like that. Which you kind of uniquely as a marketplace, I think you could afford to do because the transaction values are so high. You know, if you're a marketplace for, I don't know, make something up. Something that you pay. You pay, right? You can't afford to staff support because you're only making a buck or 50 cents on a transaction.

37:11You know, if you're talking about a $50 ,000 transaction, you can afford to have support. And relatively few of them, whereas, you know, some of these businesses like eBay are selling a zillion things, but the average value is probably $40 or something. We're selling far fewer things, but with a higher value. And so there's not as many transactions that need hand holding. What does the take rate look like in an online car? You don't have to be specific to cars and bids, but is it 1 % of it's 10 % of submission? Or like the number of cars we accept or the sales rate or the... Oh, sorry, that...

37:43What percentage cars and bids keeps out of the transaction? We take 4 .5 % of the final sale price from the buyer. So there's no fee for the seller. The buyer pays us 4 .5%. And we cap it at the $100 ,000 car, so $4 ,500. And so if it's a $200 ,000 car, we still only take $4 ,500, et cetera, et cetera. And then we make money in some other ways too. We offer financing, we offer shipping. There's now like an inspection that you can get with your car, which we make a little on. So there's some other like ways to make money. But that's the general gist of it. Which I think is the evolution of all marketplaces.

38:14I remember when Etsy first launched, it was 100 % the transaction revenue on the take rate. And then over time, I haven't looked in a few years, but I remember when it surpassed 50 % revenue on the services, on the things that they were able to upsell to buyers and sellers, became over half of the revenue of the entire company. Interesting, that makes sense. Because you start to realize there are some holes where you could pull in some more money and stuff people are looking for, frankly. And the financing is huge in this category. Like, I mean, you're not quite in this market, this category, like you're not quite at homes yet, but like, you know, most, I don't know what that means.

38:50It's the second biggest purchase of any household. Right, but you know, in the home industry, like the mortgage is everything around that. That is like, I think as much, if not a bigger part of where margin dollars are made. We thought financing would be a bigger thing than it is. I think that it is a big purchase, but since we're selling mostly enthusiast cars, more people are buying with cash than you might expect, even for higher value cars. I think that a lot of the people who are buying cars like this, it's not like a financing your Ford Explorer as your main family car, and you're gonna have it five years.

39:20It's sort of like enthusiasts who wanna screw around with a BMW M3 for a year, six months, and then sell it and get something else. And they have 80 grand to play with, that they are kind of always, it's going up or down, depending on what they bought or sold. And it surprised me how many people are making cash deals. But it's still a nice chunk of the business and it will continue to be. I mean, I've never bought a car on the internet. Could I go sell my Mazda CX5 on cars and bids, or is there some, like, we only accept enthusiasts cars? Yeah, we only accept enthusiasts cars. And in fact, we only accept about 40 to 50 % of the cars that are submitted to us.

39:54And actually, if you go and look at our like Google reviews, like a large chunk of the negative reviews are from people who just we didn't accept their car. And they're like mad because we didn't like, and it's so annoying to us because this person never even, like, they're not a trans, they're not even a customer. And they're like, these jerks didn't think my, you know, Pontiac Grand Am was cool enough for their site will screw them. And it's like, well, that's not a negative review that I screwed up at the hell. But that's like a lot of our, like, the few negative reviews. Yeah. That's so great.

40:28Wait, so how did you think about this though? Because like, on the one hand, I'm like, oh yeah, of course, it's your enthusiast car website, as you say. So often, however, your audience actually is kind of two audiences, like you've got your enthusiast audience and then you've got your audience that wants to buy the Mazda CX5 that you do the reviews of. So how and why did you decide to exclude that part at least for now from cars and bids? That's an interesting question that no one has ever asked me. That is exactly right. I do have two audiences. I have a performance enthusiast car audience and I have audiences for regular cars.

41:02And the proof of that is just look at the few numbers on some of the videos I do for regular cars. I always hold up. I've got like a Toyota RAV4 review that has two million views. And people are like, oh, YouTube's for kids, sometimes people say that nobody's really watching. Well, go look at my RAV4 review. I mean, I don't think a lot of like 14 year old boys were like jumping on YouTube to watch Doug review a RAV4, right? Like, those are... You have influenced the purchase of over a million purchases of a RAV4 of in -market cars, right? So that's probably legit or something else. They watched the video and they were like, you know what, I think I'm gonna buy a CX5.

41:33And so I did kind of turn my back on that audience, but I think what I realized was the simple truth is the enthusiasts were always gonna be more likely to engage in a space. I think that the people who are in market for new cars who are watching my videos are watching my videos and then that's kind of all the interaction they do with me. The enthusiasts are watching every video or not the RAV4 videos, but every enthusiast video. And they're like getting excited about me. And I think the real key is, if you're gonna start a business like this, you wanna do it with people who are excited about you.

42:02Which is like the churning groups, which is our investor, it's like their major philosophy is like, find creators who people are excited to be in your space because then you don't have to spend as much money on ads to try to get people. You have people who are... Your retention's probably better. Absolutely. Because wouldn't you rather go to a business of someone that you are a fan of than just like some faceless corporation? And so that's... And then you hear it's at the positive edge to the double edge sort of the enthusiast market and the relatively less financing in your corner is, people repeat transactions.

42:35They buy a car, they enjoy it, then they sell it again on cars and bids, then they buy another car. It's interesting that you say that, that's various too. Yes, we've only been around for three years. And so you'd think, well, probably you haven't had a lot of repeat people. You misunderstand the degenerate car enthusiasts that we are. We buy and sell. Well, I've constantly been buying and selling. I have nine cars right now. And so all my friends are doing the same thing. And it's always the same that we buy a car we're very excited about. I'm never selling this. Nine months later, you know? No.

43:10Really, I really think that that other car looks kind of cool. And that repeats itself over and over and over again. And so yeah, there's more repeat people than you'd think. We've had some cars already sold on the site three times. And some people who bought this buy the different market though. Like, you know, if you're buying a CX5, like that car is going to depreciate. This is like a decade car. But for the cars for this segment enthusiast, these are not like consumption per se. These are assets. And so like, yeah, it's like freaking crazy to own nine cars. But if you own nine CX5s, you just blew a lot of money.

43:44All right. If you own the nine cars, you own, you know, you're not going to lose that much money and you might even make money by owning those cars. That's right. I tell everybody to the detriment of my wife that my car is made more money than my wife did in 2021, which is, which is in fact true. But she doesn't like when I say that. But, but, but that's right. The enthusiast kind of know what they're doing a little bit more or they should. A lot of them don't. But the sophisticated ones do. And so they'll buy cars and they'll get out of them right. They'll sell them after a year and they only lost a couple grand or something.

44:13And that's fine. And that allows them to continue the hobby. Jenny and I were on vacation last week. I texted Ben. I should have texted you too, although I'm sure you get this all the time. An amazing black 356, just like beautiful parked on the street. It was super stupid. If you had David that our entire text thread would just be us texting 356s to don't. But like, you know, whatever that person paid for that or maybe they restored it or just like, they're not going to lose money on that ever. That's right. That's exactly right. And so enthusiasts who make those decisions, it's actually funny because I hear so many of my enthusiasts friends tell me, I wanted to buy a whatever, but my wife won't let me.

44:48And it's like this person's bought a new Ford Explorer. And I'm thinking to myself, you're going to lose so much more money in that family approved new Ford Explorer than you would in a Porsche 911. Yeah, it's a lot of money to put into it up front. And yes, you would do better in the market, of course. But like, the lot of these cars are just doing fine. And then 2020, 2021, and a lot of them were going up and everybody thought they were a genius. Not that that will repeat itself, but you get the point. Like sometimes it is a nice place to park money that you can actually enjoy for a little while.

45:16And if it's a new Ford Explorer, then you're in the first year losing, I don't know, $20 ,000. So you literally lost the value of two Rolexes. It would be difficult to buy some of the cars that we sell on cars and bids and lose $20 ,000. Like it would legitimately be difficult, but it's very easy to do at your local Ford Toyota Honda dealership just buy a new SUV. You're gonna say instantly. It's crazy. After we did our Porsche episode, both from learning about the industry through that and then obviously doing it with you. I came away and I was like, I should buy awesome cars and use them. But then you have the problem, which I'm sure is the obvious one you run into.

45:54Well, a lot of these cars that hold their value in them, you can't really use them for your family. There's a reason why I have like seven expensive cars in my garage, but my daily driver is a Mercedes -Benz station wagon with a third row. And they're not feasible. And side airbags and lots of safety features. And a lot of car enthusiasts just count that stuff, but I totally agree. I want my kid driving around it. And myself, honestly, on long drives in crowded cities in like a safe car. And I can screw around with the other stuff on the weekends. Your own life, let's not even make it life because that's too ridiculous.

46:25But like you having a functioning ankle for the rest of your life, if something were to happen in an accident that just crippled your ankle is far more valuable than all nine cars, even if you lost the full value of all that. Absolutely. Also, how you can play car seats? These seats are good. They don't have the latch system, I assume. They actually might. Latch is now mandated, but I don't know when it was mandated. But it is funny. I'll get it a brand new Ferrari's that cost a million dollars and they have latch because they have to by law. But, but yeah, no, that's exactly right. And so as a result of that, I try not to, first off, I try not to buy really old stuff.

46:56And actually, cars and vids is geared towards more modern car. We're 80s and up only enthusiasts cars. That's kind of the cars that, right, exactly. That's the cars that I'm into anyway. Older cars, I hate to say this because there's a lot of older cars I love, but they are a little bit more scary to drive to use. And certainly you don't want to take any vintage car like somewhere you need to go. Because there's never a guarantee that it will work. That ever. I basically like, with the exception of some, I don't know if they're 90s or 2000s, but there's some like model of the 911 in the middle that I don't like as much.

47:26But with that weird exception, as I go back further in time, I like the design more and I have more of a lust and a desire to own one. What is the like oldest safe 911 for me to get? Safe in terms of like physical safety or like reliable. Oh, it depends how safe you want to be. Safe like you would think of a modern car being safe. I wouldn't go past 2005, which was the 997 that came out no five. The model before that was safe enough, but not amazing. Before that, I really wouldn't screw around with it. Airbags were a safety feature, but car technology has come so far in terms of crumple zones and also in terms of all these other safety features that are so important.

48:07A lot of car enthusiasts discount all this stuff. Oh, I don't need a blind spot monitor. I don't need a backup camera. Well, actually the statistics say that you do and they say that they help. And I find that the more safety stuff I can get in my car is the better. So get a new 911 if you want to say this one, that's the answer. Pay for the library wine colors. So great. Okay, what is a car these days? I feel like that is, yeah, there was this whole thing about that, but oh, Tesla, it's an iPhone. I'm, I forget Tesla. That's obviously a driver of this and big part of it, but like in general, it's wild.

48:43So we have a Model 3 and we have a 2013 Acura TSX Sport wagon, you know, which is great. It hauls a lot of stuff. We just believe it on the street and like I don't care about it, it's fully depreciated. It's fine, but these are two different product categories when I drive them. Like so what's going on here? I mean, it's interesting, right? I think the Model 3 is kind of the preview of where cars are going to go in the future. And I think car enthusiasts will be dragged kicking and screaming into this world. And I'm not just talking about electric. In fact, I'm not talking about electric mostly.

49:12Electric is obviously coming, but maybe kind of slowly. What really is coming though with the, Tesla has really pioneered is the technology in cars. I mean, there's so much self -driving capabilities. Well, it's not allowed to say that. Driver assist capabilities. There's the politically correct term. There's so much functionality from the screen. There's so much, et cetera, et cetera. These cars, that's really like the new thing. And so people say, oh, iPhone on wheels is like a disparaging remark. Get used to it. That is the future of our lives. For my job, I think it's great because I point out all these quirks and features and cars.

49:44And the more bizarre things cars are getting in them, like Tesla has like a drawing pad and video games. I'm like, bring it on. I can put these on my videos. It's easy. But for, this is another correct bet that you have. Other car reviewers are caring deeply about this particular feature of the engine that most drivers will never experience. Whereas you're like, if you push this button, then it does that. That is exactly right. And that was one of my biggest things. I have told so many potential car reviewers when they asked for advice, I tell them to not drive the car. They're like, what? But I actually don't think people care that much about how a car drives.

50:1525 years ago, some cars were really bad. Like really, like late 90s, early 2000s, the end of the 80s, et cetera. There were like legitimately bad cars. And you had to go out and read a car review to make sure that it wasn't like loud or rough or crashy or like difficult to hear whatever. These days, all cars drive well. All electric cars pretty much drive the same. And so nobody really cares that much about the driving experience. Enthusiast care about sports cars. And in that case, I kind of talk more about it. But like for electric cars, they're more focused on the tech, the styling, the functionality, the cargo and interior room.

50:49Those are the things that is more interesting to people. And so yeah, exactly. Look what this button does. He is actually more important advice for a lot of new car shoppers. Then like, that's the way the differentiations should. Then like, then like all these old school car reviewers sitting there being like the steering angle and the turn in feels like this. It's like, nobody cares about that. In less, you're a real sports car enthusiast. What percentage of people who own a car do you think are in that category? In the category of enthusiast or in the category? Yes. I don't know. What do you think?

51:1815, maybe 20, 10? Somewhere around there though, for sure. I guess the low end of that. I think probably 30 or 40 % of people would say that they're interested, right? That they're maybe even 60 % would say, when I make a car decision, I think about stuff like styling and the way it's steers and all that, like they think about that. But they're not like really gonna understand some of those driving dynamic concepts in a complicated car review, right? You know, you used people by Jeep, so I like this, this is cool. That's important to people. But do they really care about all the nitty gritty technical details?

51:50No. And there's a big disparity there, right? The person who cares what they drive is probably most people. The person who really, really gets all this stuff is probably a small sliver of people. And I think if I went and surveyed Americans, what is the difference between a mid -engine and a rear -engine sports car? I think maybe 3 % would know the difference. I once read that some unbelievable percentage of people, like 70 % or 65 % were willing to switch the car they were gonna buy based solely on color. So like if they had gone to a Mazda dealer and the CX -5 was white, but they really wanted like a silver one and the Honda dealer with the CRV was across street, they'd be like, done.

52:26I'm good. And it's like, wow, that kind of shows you what we're talking about here. Yeah. For this however big it is, the small segment of enthusiasts, I think probably this does mean that the differentiation on the driving experience is gonna matter more and more and more and more to them as it becomes more commoditized for the rest of the market. Like to get a driving experience that actually is different I mean, I only, I've only driven the Model 3 but I fully expect that every other electric car drives exactly the same pretty much to get something different you have to go special. Yeah. That's right.

53:07The big differentiation used to be the power train frankly. The engine, the way the engine felt, the how smooth it was, how it accelerated and that's gone. I mean, all electric cars accelerate basically the same. Now some are faster than others, but the feel of it is basically the same. And so yeah, there's less differentiation and maybe enthusiasts will have to start to get boxed into a corner of just like steering feel and things like that. I don't know, it'll be interesting to see where car enthusiasm goes in the next 20, 25 years or maybe the old school stuff just becomes more and more desirable and more valuable.

53:38Going back to the car industry, so you mentioned electric is coming slower than some people want or then we might think, in fact you have Toyota over there saying like we literally don't live in a world that could support everybody having an electric car and our bet is on fuel cell. Like I think you can maybe only buy it in California because there's only a certain number of places in Northern California where you can even refuel the fuel cell. However, it works, I actually don't know. Is that claimed reasonable that we actually don't live in a world that could support that in the next 10, 15 years?

54:10I think it depends on who you ask. Whenever I talk to conservatives, they're like, there's no way the grid could possibly. But then I talk to like people, you know, but then I talk to like EV adopters who are really excited. They're like, no, we got tons of, I don't know the answer. And I think a lot of people know less than they think. But I will say to me, the biggest problem is not the grid, the quote unquote, all seeing grid. I think the biggest problem is like infrastructure at the end of the day. It's one thing to install a charger at a single family home which can be quite expensive and difficult.

54:40But it's a whole other thing to install a charger and an apartment complex or on the street. I mean, a lot of people still park on the street, a lot, a lot, a lot of people, even people with garages in single family homes. And so it's still so infancy. Like I want to install a charger on the street because I park like real cars in the garage. I don't want to put an electric car on the garage instead. Well, the city of San Diego doesn't have the capability. There's no like regulations about like installing a charger on the sidewalk. Like that's not, they're not there yet. So there's a long way to go, I feel like before, there can be like widespread EV adoption.

55:13And if you were designing this system from scratch, you could imagine a way to do it would just be hot, swappable batteries on cars. That like, well, if the issue is we can't have charges everywhere, then we'll just have these like big centralized chargers, just like we have gas stations and then people can easily go and get a new battery. That as far as I can tell with the vast majority of manufacturers is not the route that anyone pursues. Well, you know what I've learned? First off, yeah, that's a great idea. And I remember when Tesla announced that we're gonna do that. And then it fell by the wayside and I haven't heard anything about that like 10 years.

55:44But it was a concept they were gonna do. But every time I go to a car launch, and it's an electric car launch, this automaker's always tried out the same statistic, which is something like 92 % of EV owners charge at home 92 % of the time or something, right? And I think the simple truth is that, yes, that would probably be the right thing if you were gonna do road trips. I drive across the country every summer. It's the main thing that stopped me from getting electric car. But for most people, they just need to charge it at their house. And they don't really care that much. Like the fact that there's no quick, you know, swappable.

56:17And now these electric cars are starting to be able to charge pretty quickly, but you have to find the right charging station, et cetera, et cetera, and there are a lot of problems with that stuff. But it will all get solved. It feels like the early days of something that will become a big thing, a common thing in 20 years. Yeah. It's also like just give it the nature of the car industry, the replacement cycles on these things. Again, not for the enthusiast segment, but for family cars, they're so long that it just feels to me like it's all gonna naturally feather in and the solutions will get solved along the way.

56:46And the average car ownership lifecycle is 11 years, I think, something like that. So like, you know, yeah, that's exactly right. The problem will solve itself. It's just, it is going a little slower than I expect. You know, you live in California, it's kind of a bubble. There's electric cars everywhere. All my neighbors have Teslas and EV6s and all that. But you come out here, I'm on these coasts, this summer and there's even here in Massachusetts, there's not as many as I expected or thought. And it's still a thing where your neighbor gets a Tesla and everybody's like, whoa, and I'm like, really?

57:15Why? And then middle of the country forget about it. I mean, they're not there. It'll be a while. Which is so funny because the Model 3 is like the new Prius. I feel this notion of like, oh, you got a Tesla. It's not like, oh, you got a Porsche. Yeah, I feel like I have anything spent. Totally. I totally agree with that. But there are still people who are like, oh, every kid I meet at a car show, there's like 12, it's like, I want a Tesla someday. I'm like, it's like a Honda court someday. Like the Model Y outsold the Honda Accord last year of the year before. That's insane. Like that is insane.

57:46If you were told me 20 years ago, when I was a kid that I start up electric car with out sell the Honda Accord, the mainstay of the car business, like that's crazy to think about. But they are everywhere, right? They are very, very, very common. But not in some places and it's going to be a slow adoption. You get any new taxi in the last two years and it's a Model 3. I will never forget last year we went to Copenhagen and we were taken to the airport. We were in Copenhagen, we had to take a taxi to get to the airport to go onto the next city in a Ford Mustang Mach E. And we had the baby and all of his stuff and it was enormously difficult to deal with it all.

58:21But I remember getting out of the car and just looking at it for a second before cramming all the stuff into the packages and everything, the luggage and thinking to myself, I just got driven in Western Europe. In an American electric Ford Mustang taxi. Like what is this whore? It's so bizarre. That is the future in some places and some of those countries have crazy high adoption rates. Like most of Denmark, but some places are really far behind. You do have those little like moments of clarity when you're new parent with the little baby where most of your life you're just like, I literally am like, you know, this is wild and then you have these moments where you have like an out -of -body experience and you're like, what?

59:02Right, right. Here's something that's happened when I wasn't paying attention because I was paying attention to the baby. Oh, okay, so I don't think you've done this because I think I watch you channel pretty religiously or maybe recorded and haven't released it yet. Have you come up to San Francisco and done the cruise and the Waymo here in the city? No, but I've reviewed those. No, I haven't yet, but that would be interesting for sure. Dude, you totally got to do it. I haven't been in them yet. Ruling just happened. It's now fully commercial all over the city. It's obviously not, but it feels to me like, you know, 20, 30 % of the cars I see driving around on the streets these days are, you know, there's nobody in the driver's seat.

59:39Yeah. I'm very familiar with tech people's take on autonomous driving. What does the car guys think of all of this? I mean, it's gonna be a fight with the enthusiasts. They're not supportive. I love it. I think it's one of the greatest things that's ever happened. You know, I love driving my fun cars. I love it. It's so much fun on the weekends, you know, going on a fun road with my friends or go off -roading or whatever. But like when I'm driving up to LA on a Thursday and it's, you know, traffic, I'm happy to let the car handle all that, you know. I think that enthusiasts need to realize that there's a place for both.

1:00:12And I really, really, really strongly believe that. Like I'm totally cool with the fact that I, I just want to send emails on browse Instagram while it's driving me up the highway. And then go on the weekends with my Porsche, or my 4G tier, whatever, and like have real fun. There are still enthusiasts who are like, no, it's fun sitting in traffic too. We have to stay in drivered cars. It's like, that's, I just find that to be insane and contrary. I just have so little use for it in the city personally because I don't commute to an office. But the current product in San Francisco is such a different product than a car.

1:00:45It's not even fully like an Uber lift replacement. It's a replacement for like part of that. I think about it to like the scooters than it is. You know, like it's certainly not a car you own. I think that we're further away from like full autonomous vehicles doing a lot of stuff though, than people think. It works in limited situations very well. It works in good weather. You know, you heard a lot about autonomous cars like four or five years ago, like really the industry was going in that direction. You haven't heard as much in the last year or two like in terms of big developments. And I think they're kind of getting stuck on some smaller stuff that's actually more difficult to overcome than people think.

1:01:21Whether is a big fact, I mean, moral decisions have been discussed a lot. That's a big thing that they have to figure out. But whether is a bigger factor than people realize, there's a reason they're testing all these things in Phoenix, in LA, in the Bay. I can drive just fine and dry, sunny. Like when I really want the autonomous cars, when it's like, sleeting and there's ice on the road, like that's where I would like some help, please. When I'll set the geographical area to me, that's the thing here in San Francisco, at least with this is it only operates in very specific neighborhoods and parts of the city.

1:01:53It's like geofence to can't go out. So that's why it's not even a real replacement for Uber and Lyft. It's like, oh, I want to go to Moran. I need to go to the peninsula. Like you can't take a waymo for that. Did they need to go get like, you know, millions of more training hours on those roads? What's that? They must be teaching them individual roads, which would eventually work, I guess, but has it obvious enormous limitations, including when they start doing road construction and suddenly those roads are different and then they got to do it. I mean, it would be like a never -ending thing. But that's what Cadillac is doing.

1:02:20Cadillac's driver assist technology is called supercruise and it's the best in the business. No question, but they mapped the highways. They like literally individually mapped the freeways in order to get it done. And that took a lot of time, you know? Like, it's amazing. It works incredibly well. You can be totally hands -off in a new Cadillac. You could drive from LA to San Francisco completely 100 % hands -off, except when you have to go and refuel, but like they had to map the freeways for that to happen. And so good luck. You totally should come up here to San Francisco and do both Waymo and Cruz.

1:02:50Just fully review the actual car. What if I'm in down in LA and I see it fairly frequently? I just don't remember which one. They're like using Jaguar eyepaces, which is a horrible electric car. Oh, I think that's Waymo. That's what that's what these are. The only people willing to buy that vehicle. But yeah, they're around. It's just a spew of conclave of driverless cars. More or less apparently. But yeah, it will be the future someday, and I'm ready for it. I'm ready to just sit and traffic and let the car drive me. Cause you drive it a lot of traffic. Cause you go in around to these cars. Yeah, I mean, I end up driving up to LA a lot and it won't just county a lot.

1:03:24And it's just, it's such a slog. It's so difficult to do. The 405 is just the worst thing that's ever existed. And so it's a lot. My last car purchase I bought at Mercedes station right in pretty much brand new and I based my decision almost entirely on the quality and efficacy of its driver assist technology. And it's really good. By the way, I feel bad for throwing shade on enclave owners. What I actually mean is the encor. Neither are good. Just looked it up. Neither are good. The enclave is better, but the encor is, there's also one called the Envision, which is made in China. They're not a lot of Chinese made cars in America, but the Envision is.

1:03:57Oh, this is fun. Okay. What is the worst car on the market right now? Like what should you absolutely not buy? What is like the best for each kind of category of purchase here? Worst car on the market right now. I really for a long time would have said that it was the Mercedes Benz Metress. Mercedes Benz makes a large van, but I think they took that off the market because no one was buying it. That's a terrible car. A lot of the cheap little stuff is pretty bad. The Mitsubishi Mirage is a horrible car. I can't believe they still make theirs. They might not. They might have just recently stopped.

1:04:29The thing is there's not a lot of bad cars anymore. There was the Dodge journey. That was a horrible vehicle, but I think that's off the market too. Not in Mexico though. You can still go south of the border and grab one. There's not a lot of really bad cars though. Most cars are now good. That's just the situation. Every automaker is realized, information is too readily available to people to just make a bad car anymore. People aren't gonna stand for that. They just won't buy your vehicle. We can't get away with what we used to do. Yeah, truly, especially the big three, Ford GM and Chrysler would just make trash and a certain subset of people would buy it either because it was domestic or because they didn't know any better.

1:05:05And now there's YouTube. People are... That's it. Doug will save you. Right, I will save you from buying a crappy car. It's actually interesting. I think this is one of the unsaid things about car reviews. I've always made this big holier than now stance that I don't accept anything from the automakers, including plane trips and hotels. If I'm invited to a press event, I pay my own way and stay in a hotel at my own cost. And I've always been like, I do this to remain impartial and it's a nice position to take and it does go far. But why end up coming to the same conclusion as the people who the automakers paid to bring there?

1:05:40Because the truth is the cars aren't really bad. And they're probably was a day when the automakers would wine and dine these journalists and say, you're gonna say nice things, right? But they don't have to do that anymore. Like cars are actually good. It was common practice too, right? I believe, especially at the big three, you know, American automakers, two, four models that executives were gonna drive and test and reviewers that they would be like for those specific cars. They would be different than the cars you bought at the same time. And that still happens. There's no question that still happens.

1:06:10I would say it probably happens across the entire industry. The press department orders cars. There is an option code that most automakers have but hide from their windows stickers called press finish. And there is dispute about what that is. Some automakers, there is absolutely no question that press finish adds power. Absolutely no doubt. Like they've been tested. Other automakers claim it's just like, just a little extra attention to detail on the line to make sure that there's no glaring issues or anything like that. And I buy that in some cases. But there is no doubt that the press, now you're thinking to yourself, well, I wanna buy a former press vehicle then.

1:06:45No, you don't. Because then the journalists get into these cars and abuse the hell out of them because a journalist making $63 ,000 a year, getting into a Ferrari is like, this is amazing. You know, so you don't want those cars but they definitely get a little extra something, something at the factory. Wow. That's great. All right, there's a couple of things about cars and bids I'm very curious about. So you opened talking about this with sort of why it kept you up at night and what the goal of starting a business was in addition to just the media side of the house. And I'm curious after the last what four years has cars and bids become a bigger business for you.

1:07:23And you can talk about whatever numbers make sense, the whatever gross margin or net margin or maybe top line revenue. Compare the media business to the marketplace business. Yes, cars and bids is clearly bigger than the YouTube side. But I think the real crucial thing is even when it wasn't bigger than the marketplace business and we knew this from day one, it had more potential to be. You can only get a YouTube channel to be a certain size, right? I mean, you can Mr. Beast didn't go crazy in whatever but that's very rare and very lucky and my channel clearly was not at that trajectory reviewing cars.

1:07:52But the cars and bids clearly has more like upside and growth potential. And so it is bigger and I suspect that that divide will only continue to grow, grow, grow. And I have to imagine the margin profile, tell me if I'm wrong on this, on the YouTube channel is basically a hundred percent gross margin, basically a hundred percent net margin because for the longest time it was just you and so. You don't have drones and you know, red cameras. Except for travel, there were a few things. I was paying an editor, my best friend, like read my emails and so I pay her, and there was some travel. But the expenses were, yeah, I mean, I was probably 90 % net.

1:08:29It was a great business, honestly. Yeah, we're familiar. Yeah, so that's right. Then the other side of the house, you probably have five or six percent gross margins on cars and bids because you've got the four and a half percent take rate plus a little bit more. So you're starting at, you know, it could be a much bigger sort of volume business but then your sort of net revenue that five, six percent, how does that compare with the revenue from the media? It's a lot lower, especially now because we took this huge investment and so we are kind of investing in growth. And so it's one of those classic situations where we're kind of knowingly giving up net revenue for the next however many months in order to get the tools in place to like grow the business to a place where we need it to be.

1:09:11Oh, I guess what if you just add it up all the five percent of the car sales? No, I mean, it would be much, much higher, yeah. But there's then the media business much. I mean, you can, we're selling basically 30 cars a day or we're auctioning 30 cars a day. We have about an 85 % sale rate. And so in the average transaction value, I don't know, but you could figure it out very easily just from looking at the site. It's somewhere in the 30 to $40 ,000 range. So you can kind of do the math is there's real money being made. It's just that there's a lot of employees. Yeah, the, you know, sort of net revenue grows both over you but then like everything between that and profits, there's a lot more on the car's inside.

1:09:46Right, exactly, exactly. Yeah, that's fascinating. Two very different businesses that share a top of funnel, but right, that's exactly it. They share a top of funnel and other, and they're obviously both in the same field. You could see someone watching videos and then buying or selling cars, but they are very different businesses the way they are run and the way they exist. And it's kind of an interesting thing to be part of both. One topic that I think will be really interesting for our audience, Ben, you're probably gonna go this way. Before the chairing group investment, you guys didn't raise any venture capital, right?

1:10:15My partner, my business partner, his company kind of, was the one who gave us like our seed money essentially to get started. I didn't put up any of my own cash, but it wasn't like, you know, if, no, not in the YZ founders, we're gonna go do this. This is the type of business that you would go, you would do Y -combinator, you'd raise a seed round, you'd raise a series eight, to get to the point where the chairing group investment happens. So like pre that, a normal startup would probably be 20 million plus of capital into the business to get there. You guys didn't do that. We did it with a lot less, you know, but the result was, we kind of had to be scrappy and we sort of had to, you know, make it work sort of thing.

1:10:54And we were profitable pretty quickly. I think the car market helped us out a lot. We also stayed lean, we stayed really lean. But I think the drawback of that was, we probably didn't grow as fast as we could when the car market was blowing up so much. I think that if we had had more money, we probably would have made some more strategic hiring decisions and that probably would have grown us a little faster, but we did the best we could with what we had and now we don't have to make those distinctions anymore. Obviously this is a special case, because you're ducting me, you know? And you had the built an audience and all that.

1:11:21It's just really interesting to me to something I've been observing from many different vantage points over my career is like the amount of money that startups raise, the correlation between that and success, you know? As best as I can kind of come to, I'm not sure that there's really any correlation. I think most of the time it is negatively correlated, except for the most extreme outlier, successful outcomes, it is required. Specifically to get to a point where like when you took this investment at a certain point, yeah, you need capital. Like you took this investment from the turning group, like if you're gonna really, but you need capital, but to get to that point, like whether you raised $0 or you raised $30 million, like, Ben, you're right, it might be negatively correlated to raise more.

1:12:09I actually just right now I kind of think there's no correlation point. That's point is interesting, no, it's negatively correlated. Unless it becomes essential. So that's the problem with these VCs and PEs, right? They like have to make a decision, is this gonna be one of the negative correlation or is this gonna be one of the essential? I don't know, it's an interesting point. Yes, I don't know a lot about this world. We've gone through this round obviously with the turning group and of course during that, I learned a lot about this process. And I'm the type of guy who spends a lot of time learning about this sort of thing when I'm in it.

1:12:38One thing I have noticed is that a lot of the people who are in these firms have only been in them since the last recession. And are kind of these young guys who sort of think that they're gonna like do it. And frankly, they've probably had a great track record so far because the economy has generally been strong over the last 15 years and that's where all their investments have happened. And I think in a lot of cases, a lot of these people have thrown a ton of money at stuff and it's worked. Whether or not the money helped, right? Or was the reason that it worked? Or that they were just surfing market beta.

1:13:10Like they didn't even need to look for outperformance. It was just like, oh, I'm in a market. I want to put money in the market. Some of me wonders if maybe things are gonna change a little bit. I have a suspicion that our event was a well timed. Not that I don't think we're gonna continue to grow, but I do think that for the car market, especially there was some unprecedented growth. But it'll be interesting kind of to see how these things evolve over the next years. People could stop and Google it and can you give us the details on when was the investment, describe the transaction, just so people know what we're talking about.

1:13:40The Churnin Group, which is like a private equity firm in LA that primarily specializes in these businesses like ours, which is like a business that creators lead. There's other ones like Meet Eater, which is a hunting YouTube channel that turned into a business and barstool sports is another one they invested in a long time ago. They bought the majority of our business a year ago, basically. And so they installed a CEO who I, they installed. I mean, I went through the whole hiring process and it was quite something. I love him. And obviously put money on our balance sheet so that we could grow the business even further, which we have since the investment.

1:14:09So it's gone well for everybody. And what was the total amount of capital there? They threw in like 37 million or something like that. And some of that was secondary. And then there was additional that they kind of threw on our balance sheet to help us grow. And this is for the combined. That's right. You merged your channel and cars and bids for this. One interesting aspect of this whole thing is that, yes, the two businesses were merged into one business, which I think was a really good thing for the business. Because in the past, I was kind of serving two masters. The media business was where I was actually getting my paycheck from, right?

1:14:40The marketplace business was the one we thought we would, you know, would grow. But at the same time, if I got a great offer to go review something in the media business, I was gone for a few days and I had to do it because that was my business. And now they're all under one umbrella. And so the money is made by everybody and everybody's happy. And the growth of the media business means the growth of the marketplace business and presumably vice versa. So it's a good thing to combine them. And the incentives are aligned. You know, it's this classic thing when you have like a conglomerate and two division presidents that they're like are each trying to, you know, make their own P and L look better.

1:15:08And now everyone's on one P and L. Right. It's interesting, right? Like Doug, you obviously know this. Listeners may or may not be familiar with this. This is maybe it's more just like our whole sort of quote unquote creator world that Doug Ben and I are all in. But the hot topic to sure is what Turning Group does and like creator starting these businesses, them selling it's feastables and Mr. Beast and all that stuff. Everybody wants to do it. And this is a key aspect of it that I think a lot of people don't really think about and understand of like, well, the media business is that part of the other thing or is it separate because as you say, once you start building a company, you know, you need employees, you have a separate set of stakeholders.

1:15:50But then you could get a million dollar opportunity in the media business that takes your eye off the ball. They you as far as I know and I don't know that, you know, cap tables of certainly many, if not all of these other media creator businesses, but you're the first person I know that I know for sure. You actually merged to the business. But it made sense. I could see no real drawback to it, frankly. And I still feel that way a year after it happened, I still think it was the right thing to do. And it is a great investment philosophy. It's an interesting thing. I've said this on some stuff before, but like it's a great investment philosophy in some senses because you're investing in these businesses that are creator led where like I said earlier, like people love the person.

1:16:27And so they physically want to give you money. Like they want to support you as opposed to like a regular business where you got to advertise on all that and it's like a faceless corporation. But the drawback and the weird thing about the way the turning group operates, these businesses are thus kind of propped up by individuals who could turn out to be problematic, right? Like that's the thing that I'm always like, really, are you sure you want to invest in this? What if I go on some Twitter rant and you know, and then I'm cancel, right? Like that's a real possibility. But I think their argument would be it's worth the risk because I think they think this is how a lot of businesses will evolve over the next 20 years.

1:17:02You see the Kardashians going out starting businesses. You see Mr. Beast like businesses on the back of these followings. That's a real thing. There's like real money to be made there in real businesses there. And maybe people are going to gravitate more towards businesses like this as opposed to just like the gaps. Absolutely, yeah. Well, and this is where the keeping it all under one roof of merging the media business and the operating business businesses, whatever you want to say. I think makes a lot more sense and can kind of start to solve it because at least the incentives are all lined.

1:17:32Right. It'll be pretty crazy to imagine what we're all to wear. Like big swaths of the economy have a leading player that's a human brand. Like imagine gas stations. Like what if there was a like John Rockefeller's base was on exactly? Well, that's that's actually where my thought process was. It was like, I don't think in the time period, most consumers knew the name John Rockefeller, but they knew state or oil. And so could we eventually get all the way to a world where like I get my gas from, you know, I don't know if it's Doug's gas station, but that has a personality associated with it. Well, I think this is what Mr.

1:18:05Beast wants to do with. Beast, I think he wants Beastables to be like, you know, proctor and gamble or something like that. Yeah, it's an interesting thing. And I really do think it kind of clearly is becoming sort of the future of how these things work. When I launched cars and bids, I didn't do it intentionally like knowing that this was a thing that and honestly, at that time, three and a half years ago, it wasn't as much. It wasn't, no. And I think that the success of that and several other things has kind of shown like, hey, this is like a real thing and let's go do more of these. And I think and the advice I give to all my creator friends is you need to do something.

1:18:42You need to do something. YouTube is not enough, TikTok is not enough. You need to take your audience and go do something. Oh man, I would say starting maybe six months, I would say before you did the churning group transaction, you know, friends and other people in the business who started coming to us and be like, what's your cars and bids? Like you guys need a car as in bids. You know, we've always been like, I think that the dynamics are a little different in podcasting and we're kind of a unique animal. But so we haven't done it for various reasons. But you know, you pioneered this like literally, you know, you became a verb of like, what is your cars and bids for?

1:19:15I mean, to an extent, I'm so glad it worked out and I'm so glad I did it. It would have been the worst mistake in my life not doing it. And I'm telling us in creators, and you know, one of the problems these creators have when I tell them this, I've like become sort of the elder forefather of the car YouTube space. Every time I like go to whatever bizarre town these guys are located and I have dinner with them and then they're always asking advice. And I always tell them to start their own business and they always say the same thing, which is how the hell can I start my own business? I'm so consumed with YouTube.

1:19:43Like I'm so busy with doing content. And the answer is, I don't know, but you better figure it out because there may be a day when you're not as consumed with doing content and when your audience isn't as engaged that you wish you would use that opportunity. I felt this way having a full time job for the last eight years while we were doing acquired. It's like, is it an enormous sacrifice? And I basically have to give up all my hobbies in order to create a media thing that people actually care about. Yeah, it is. And at the same time, you have to make trade -offs in life. You do? So I did it sort of the opposite direction, but.

1:20:14That's exactly right. And you can make it jump or not. I hate to say this because I don't want to get people discouraged. I never feel like that. And it's isn't true for everybody, but I think the earlier in life you can do it the better. I started YouTube when I was, first off, when I was too young to know any better, which I think is legitimately important. It's funny. It's a joke, but it's true. If I had been 37, I think I would have been like, that's just stupid, but I was a 22 -year -old. I was like, I can do this because 22 -year -olds think they can do anything. And also, I just didn't have that many obligations.

1:20:46I just simply didn't have that many obligations. And I think that when you're 22, it's hard to realize how few obligations you have compared to someone who's 35. I got two mortgages now. I got a kid. I got another kid on the way. I got nine cars, apparently. And congratulations. Thank you. Not on the cars on the kid. And by the time this actually releases, yeah. Actually, it's eight right now. It'll be nine when this really, but anyway, you can't. You just can't as easily do it. And you don't want to. You can't afford to take the risk. It's just too difficult. And so when you were planning cars and bids and working on it, did you already have your kid at that point where you were trying?

1:21:20No, we were trying. In fact, we had a miscarriage the week the site launched, which was like the most bizarre. Oh, so sorry. You know, it worked out. We got our little guy and we got another one and it's going to be fine, but it was like holy crap. What a bittersweet, bizarre situation to be in. But no, we didn't have the kid yet. But the thing is, because I had a partner and because I had employees and we had some money behind it, it wasn't quite as big of like a time suck for me, but that first year was like really, really hard. And honestly, I missed a lot of early stuff with my son. And I'm so happy now that I'm able to like take a little bit of a step back and get some breathing room and like be able to spend like real time with him.

1:21:56Frankly, I like this two year old stage, a lot better than the infant stage anyway. I agree. Strong agree. I'm like, get about the same age as you. Yeah, definitely. All right, Doug, before we wrap here, knowing the acquired audience, you know, it's people and tech, it's investors, it's CEOs of startup companies, lots of founders. Anything that you want to leave folks with before we head out here? No, not really other than kind of what I just said, which is a more of a message to creators, like go do something with your audience, to people who are starting up and founding and like running businesses like creators or God.

1:22:33Use creators though, like creators are more useful than you think, and a lot better investment than digital advertising. If you can partner with creators, I think that's like a very, very useful way to run a business and start a business and try to find... Potentially on the cap table. Like instead of like media buys, like, you know, what if someone had come to you and said, I'll give you a big chunk of my company and you get to be the co -founder and you don't have to do any work except talk about it. I will tell you this though, the creators, so since we launched, we've been trying to do a lot of collabs.

1:23:01Since we launched, like since we combined the businesses, we've been trying to do a lot of collabs so that we can get past just my audience and I've done a bunch with a lot of great people. We've tried to do a lot more. Creators, what a group. What an interesting and bizarre group of people. Like people can't come to meetings that are scheduled on Zoom. Like they do, oh, I forgot, can we do it tomorrow? And I'm like, sitting there. The cap table is a total opportunity to get people, but a lot of creators are less sophisticated than you think and are like difficult to deal with. And so like, I think the goal would be try to find the 7 % of creators who can keep a schedule who understand how Excel works, who can like go on a Zoom call.

1:23:38Like, it's hard. Like, it's legitimately hard, but like they're out there somewhere. I mean, I imagine not to disparage anybody else in your category, but I'm just like, I can't imagine anybody else in your category that would be like you. Some are better than you'd think and honestly, some are much worse. And I've talked to some people and I'm like, I hear their like story and I'm like, I can't believe you've even made it this far. Like, it's difficult work to get this far, but like, it's the traditional story. I read a great Vanity Fair piece from years ago about Johnny Depp and his crazy finances and how he's blew all his money.

1:24:10And it gets into this. Like, he was spending $300 ,000 a month on employees. He had 14 homes. It's that kind of thing. Like, creators and the creative types like need people to rain them in. And I think where you strike gold is if you can find a creator who's kind of also like me which is like, gets the business side and what you actually have to do in order to be like a reasonable person. And that's harder than it looks, I think. Totally. Okay. One more last thing before we let you go. If anybody in your audience is looking to get into cars as an asset class wants to do something on cars and bids maybe like, what would your advice be for somebody that's interested in?

1:24:47Oh, I might want to buy a 9 .11 from 2005 or a 350 or whatever. There are some cars that I think are undervalued. I think the main key that I would say is buy analog gas powered cars, cars with manual transmissions, big engines and old school feel, old school look. As cars start to become more electric, all electric cars sort of have a similar shape because of aerodynamics and fuel range. Gas powered, old school, wedge shaped, exotic V12s are gonna be like the cars that continue to go up. And over the last three years, a lot of cars have enjoyed a high rise in value and I think there are still cars that have a high rise to continue going as the market starts to get more and more and more dominated by like EVs and sort of look alike vehicles.

1:25:34I think there's gonna be more and more people who with newfound money are gonna wanna go back to their childhood of like fun, old school analog cars. Oh, the nostalgia factors. Absolutely. So cute. And that's already happened. I think it's gonna happen a lot more. I suspect. How do I back your intuition here? Like can you start a fund that I can invest in? Do you think about that? I think I appreciate it. We need an ETF for Lamborghini Kundalini. You know what's funny? I actually have started to develop this thing. I got to do a video on it but I've started to develop this thing about market cap for exotic cars.

1:26:03If you multiply the number they made by the number they're selling for, you can start to see which ones are maybe looking a little undervalued and you have the total market and maybe which ones are looking a little overvalued. I recently bought a car that plays into that and I think that people should maybe look at that a little bit more. A lot of cars actually fall right into the same area. Career GT, 4GT, a lot of like very special cars fall into about the same market cap. And stuff that's wildly high and wildly low, you start to think either there's a reason for it or maybe there isn't. And either it's over or undervalued.

1:26:37That's a thought that I'm having. If you ever make a spreadsheet and want a second set of eyes, set it up for the next day. I do have an Excel running and I... If you want to share some of that alpha, just do it. Seriously, this should be part of cars and bits. It probably should. You could intract a whole nother investor thought. Part of the problem is for very special exotic cars, there are production numbers printed, for like lesser cars like M3s and stuff, it's more difficult to find production numbers. But I have a whole exotic car market cap spreadsheet and there are some cars on here that I would definitely be putting some money into.

1:27:08And maybe I just did. I'll announce that soon on my channel. Then knowing you right after this car. I subscribe to Doug DeMue on YouTube. For your instant alpha, there you go. Awesome. Listeners, thanks so much. We'll see you next time. We'll see you next time.