Episode 484: Mark Cuban's Cold Email Empire: How $750K Investments Turn Into Billion-Dollar Returns

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1:55How many people actually work for you and your organization? Just in dealing with the Shark Tank and other deals, probably 12. That's all. Oh, that's it? Yeah. You have one. This is like a side note. Alyssa's Cookies or oatmeal? Yeah, Alyssa's Healthiest Cookies. Oh my God. I'm obsessed with those. So am I. I eat them every morning for breakfast. No exceptions. They are delicious. You can't get them on the West Coast. Yeah, you can. You can get them at Ralph's, I think. No. No? Trust me. I've checked because I found them in Florida at the Super Bowl two years ago, and I became obsessed with them.

2:29And you can only get them at public, Safeway. And on the website, it was a whole shmadre, so I never ended up ordering them, but I called them a bunch. I was wondering when they're going to be here because they are so delicious? No, because I know because one of my deal parts with Shark Tank is they got to have Alyssa's there during the day for me to munch on. So they're here, so I'll find out for you. But you got to hear the story about this guy. Doug sent me an email saying basically he was living out of his car and broke. And he sent me samples of these cookies. And the first thing I always do when anybody sends me any food is I look at the nutritional information.

3:04Because if it's all fat, sugar, whatever, I'm not going to be interested. So it's this huge cookie. And I I turn it over. It's 190 calories for enormous cooking. I'm like, that's not bad. Then I look, it's like no added sugar. I'm like, that's good. All this fiber, huge amount of fiber, like a whole day's worth of fiber. And then protein. I'm like, okay, let's see how this thing tastes. So I break off a little piece. I'm like, this is good. I'm like, what's wrong with it? So then I go to pull the cookie out of the wrapper and it falls apart. And I'm like, ah, that's the problem. Because when people go to buy a cookie, they want to eat a cookie.

3:39Right. Right. So I made them change it to healthy bites because the way their whole manufacturing process works, it's really easy to combine it with a little bit of moisture and put it together. So it tastes moist, right? And they're just these little bites and they stay together. Put eight into a package. And with eight of them, it's only 360 calories, right? So I eat, yeah, so 45 each. So I eat like all eight of them for breakfast. Oh, that's what I did too. You had to eat four or two. No, no. And it's only 360 calories for breakfast and I'm getting my fiber. It's like eating healthy cereal, only it tastes better.

4:13It's delicious. And you feel like you're depriving yourself with it. That's what I felt like. I feel like. But this is like two years ago or three years. With COVID, I can't remember. Everything blends. But I haven't looked for the last probably a year. But I was obsessive over them. We got to find you where they are up here because I know they are. And I order them either from Amazon or from - Oh, Amazon. I guess it could be that too. And right from the website, Alyssa's Healthy Cookies website. I should just do that too. Are they doing well? Oh, Russian. So this guy went from living out of his car and us helping him get started.

4:51I mean, I went to Central Market in Dallas and did one tasting thing. Yeah. And then it just blew up from there. Really? And that was more than 10 years ago. Now they'll do just under$20 million in revenue, but that's not even the good part. We spend no money on advertising, not a nipple, not a penny. Yeah. Nobody knew what they were when I was telling them. Yeah. But people go in there and buy them, but people who buy them keep on buying them over and over and over again, and we'll make$10 million in profits. That is amazing. So this guy went from living out of his car to being Mr. Badass down in Florida, making millions of dollars a year.

5:29that's incredible you know it's funny that you say that because for the super it was for like maxim super bowl party and the whole stuff like everybody who was doing it everyone became obsessed with these things and we would buy we would we would like clean the shelf of every single yeah i go in there and i buy like six at a time eight at a time wherever i'm traveling easily for sure i mean alissa's healthy cookies and now we have a vegan version and we've got a chocolate version Yeah, they're all really, really, really good. And if you've got a little bit of time, you throw them in the microwave and they get really smooshy.

6:03Yeah, soft. They're great. They're great. And they've got a little travel pack. I take them in the row with me in my little computer bag and backpack. Yeah, so I can travel with them and I always have something healthy. Okay, we've got to find out about this West Coast thing because that doesn't make sense. What's with you and oats though? With mush? Mush, yeah. I call it mush. I'm Canadian. Mush. And do you just love oats? No, it's not that at all. No, I like things that are tasty and healthy. Yeah, it's true. You know, and, you know, actually the female entrepreneur behind it is just insane.

6:31I mean, she's just amazing. Yeah, she's a force of nature. So when you get companies like that and the entrepreneurs are amazing and the product's amazing and it's healthy. Yeah, why not? Totally. What's the one thing you look for when you do an investment with a startup? Is it the people or is it the product? Product first, because you can have great people, but if it's not going to sell, it's not going to work. But, you know, I look to see, is this something where I say to myself, why didn't I think of that? Yeah. That's the first thing. And then even if it's not quite that, I'm like, okay, you know, if I'm looking to buy it or a typical consumer company is looking to buy, is this something that's going to be compelling, differentiated, easy to buy?

7:10And if it passed those tests, then I look at the entrepreneur and say, okay, can these people do it? Yeah. Well, you know, I find it interesting. I always stare at you when I watch this show because I feel like you're very decisive. That's not the answer I wanted after you said that. Oh, yeah. Well, maybe I stare at you for other reasons too, but this is like an ad, you know, a family show. But why is it that, like, I feel like, maybe it's just my opinion, but you're so decisive that you could, either you like someone, I feel, or you don't like them. Like, you know pretty quickly. Well, remember, there's a lot of editing that goes on.

7:43I know. That's what I'm going to say. Is it just because of the editing? Yeah, it's because of the editing, right? Because how long is each pitch, really, in real life? Stupid ones, 20 to 30 minutes. Oh, wow. Intense ones, 90 minutes to two hours. Medium ones, an hour. Oh, so that's why, because they're so much longer. It's our money, and we know nothing about them when they walk into the room. They're not vetted at all. They're vetted by producers, but not by us. So we know nothing about them. Here comes Jen. They'll say, this is Jen, and that's it. So it really is a surprise when people walk in.

8:14Yeah, no idea whatsoever. So then what happens is like, well, then you guys do due diligence, right? After we say yes to a deal, we can do due diligence. So what's the ratio or how much percentage of things that go through? So early on for me, it was about 75%. But now we get more and more people who just come on for the commercial. Yeah. And so they'll say, oh, great, we got a deal. And then they'll ghost it. They do. They do. Yeah. Because I've had a few people come on here or I've met in like real life or whatever. And like they said that they went on and it was not you actually. No. Other people, other sharks.

8:46Wouldn't close the deal. Wouldn't close the deal. And it just like - Or try to change it. Yeah. It dragged on and dragged on. Yeah, that's not me. Yeah, not you. Some of the other ones who do that where they'll like try to change the deal terms and this and that. And that's up to them, right? However they want to do it. But if I agree to it, I'll agree to it. But if you drag me out, then you're playing with fire. Yeah. Because either you want to do a deal and you agree to what you agreed to or not. Yeah. And who's your favorite shark besides, you know - I like Barbara to work with. Yeah, I like her too.

9:12Because we compliment each other because she looks at people first and I look at deal first or product service first. And so we compliment each other really well. Right. So do you do most of the deals you do with her though? If I can, yeah, if I can, yeah. How about those other two? We'll move off of this, but I'm so fascinated by this show. How about the Mr. Wonderful? Yeah, he's okay. But Kevin doesn't do a lot of deals. Nothing. And he also wastes people's time. Yeah, that's a shtick, right? Yeah. But he's a great guy. So yeah, he's a really good guy. He's not like he is on TV. Oh, he's not?

9:42No, he's a really good guy. The other one seems very nice, Rob. Robert's too nice, you know. Yeah. But he's a good guy too. Lori does a good job. You know, Lori is all about her wheelhouse. Things that she can just plug in and sell, QVC or whatever, she's going to be great at. Right. So then I want to ask you back, because when you were a kid, obviously, you were selling the baseball cards and the garbage bags and like stamps, everything for those basketball shoes that your dad didn't want to get you. Yep. Like you were like a born hustler. Like you just were. Without question. Without question.

10:13So were you like the guy, like if I went to school with you, would I be like, oh, that guy's for sure going to be a billionaire? That guy's for sure going to be successful? No, no, no. You probably didn't even know who I was. You'd be cute and I'd be the little fat guy. I don't know. I don't know if I'd be the cute one back then either. Yeah. Like when I was 16, no, when I was 15, 14, 14, freshman in high school, I was playing baseball and I ran into a bicycle and my parents, like my dad did upholstery in cars, didn't have a whole lot. And rather than getting me caps, because I broke two teeth running into a bicycle, and rather than getting me caps that matched all my other teeth, they got me stainless steel caps because they would last longer, they were cheaper.

10:52No way. And so every time I smiled, even in my high school graduation picture, there would be these two teeth at the bottom that were steel colored. Really? Yeah. I mean, and like if I showed you my 16-year-old picture, I was like 5 '8", 5 '9", weigh 30 pounds more than I do now. Really? Yeah. Can I see a picture? Do you have one? Let me see. That is – I would never have guessed it because you seem super – Yeah, things change. No kidding. Things definitely – yes,$4.7 billion later, things definitely change. but like you seemed very all I mean I don't know you're me at 16 my god no it isn't yep this does not even look like you that's me at 16 wow wow I don't even know what to say the teeth are gone like you got them fixed and no no no no you just can't see it there no I'm saying that right now oh no yeah like you got them fixed after you kind of like got out of this whole face.

11:54That's insane. So like you showing everybody, it's pretty amazing, actually. I would never, but also - That's one handsome motherfucker, right? I was going to say, the truth is like at the time, if you saw some pictures of me when I was 15, 16, it's mortifying. You know what I mean? Exactly. Thank you. You don't have to be so dramatic there. But like the point is that still, like you are not no, You seem to have a confidence, though, a self-confidence. Where did it come from to even do all these deals and wheeling and dealing? I mean, there's two different things, right? Like being confident around girls when you're 16 and then being in business.

12:34Like in business, you can just do the work. Right. That's your thing. Yeah. Do the work. You do the work. So you pick whatever topic. And if I need to learn it for business for whatever reason, I can just spend the time. Yeah. And it's just up to me. It's like the saying, the one thing in life you can control is your effort. Absolutely. And so that's just my style. I mean, you know, I learned early, early, early on that most people didn't. Yeah. You know, and whether it's learning how to code, whether it's learning about business, whether reading this book or watching that video, you can figure shit out.

13:04Yeah. Most people don't do it. And so that's what gave me confidence because I knew I'd do the work. Right. I'm prepared. And that set me apart, always. So you're just like, you love, I read this a bazillion times, and I know you've said this, like you just love to learn. You read a ton, like four hours a day. Curiosity is one of the greatest business skills anybody can have. And once you're curious and you find something that's interesting to you, particularly if it fits what you're trying to accomplish, then it's just a matter of taking the time to learn it. Right.

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14:49were you always just very interested in like computers and not computers necessarily yeah it's my software what do you call it like yeah all the above right technology and um it wasn't until um when i got to dallas um i got a job working for a software store and i had to learn it all right there and then on my own and and that's really what got me into it i found out that because, you know, I didn't mind reading software manuals, hardware manuals, whatever, that gave me an edge and I could sell. So you combine the two together and I taught myself how to program. And, you know, I did really well as a salesperson selling software until I got fired, you know, and then I started my own company and the rest is history.

15:29Well, also like you're very self-reliant, like you don't like mentors. You never had a mentor, right? No, never. Nope. What's your reason for like, do you like, because when people have asked you that before, Or you're like, no, I don't believe in them. It's not that I don't believe in them to each their own, but it's just like you just going through the process of figuring things out is a skill. Yeah. Learning how to understand a market or a company or a product or service is a skill. Right. And, you know, there really aren't shortcuts. Right. And I get, you know, having a mentor to introduce you to people and all that kind of stuff.

16:04But those same people will introduce you just as a referral if you have a great product or service and you're good at what you do. Right. And that's the way I always looked at it. And so what do you do? Because you're in the situation now where everybody wants you to be their mentor or something from you. Yeah, I get that all the time. All the time, right? I just say, fuck off. Did you say that? Does it work? Does it work? Yeah, especially the 16-year-old kids. Yeah, exactly, right? No, I mean, it just depends on the circumstances. It's like, typically what I'll do is just say, okay, you know, send me an email.

16:35Yeah. And if it's a question I can answer, I will. And as long as they don't ask me 50 questions, you know, as long as they don't ask me things that are easily answered just by searching online. Right. You know, then I'll try to help them. Because sometimes, I mean, it's crazy. Even like probably what I would have done, like 12, 13-year-old kids that'll email me with business questions, you know, you can tell it's very self-serving, you know, or Or I'll get parents emailing me for their kids. They do what they say. Yeah, it's just like, oh, my son or daughter is really interested in ABC. Can you answer these questions?

17:07I'm like, no, I'm not going to answer them for you. Now, if your son or daughter took the initiative, what's insane not to go too far after that? Like, now I'll get emails from parents of adults, you know, 22, 24, 28 years old, you know, asking for job advice for their kids. I'm like, hell no. Isn't that crazy, the coddle culture we have now? I don't know if it's culture per se, or just like these parents that are just like - A lot of them. Yeah. Helicopter parents to the 9 ,000th degree. Absolutely. And I'm like, no. I just want to respond. How do you get your information? You're so accessible, though.

17:45Yeah, my email's public. So I was going to say, how do you not have, aren't you just inundated all day? I know you have 10 phones you carry around. Well, no, I got two. Well, three I have, yeah. just in case I need better service or I can be working on one and whatever, talking on them. But in any event, like you know how you can just set up preview mode on your email? So I just read the preview. And if it's interesting, I read it. And if it's not, I hit the delete key. It takes me two seconds. Wow, you must be doing that all day though. Yeah, it doesn't matter if I'm eating lunch or doing whatever.

18:17And it's me time where I can just bang through them and there's always something interesting there. And I've literally gotten emails where I've invested probably over$100 million from people I don't know. And a lot of, there's one company that I invested, I don't know how many millions now, and they're out here in LA and they're begging me to come visit because I've never met the guy, Relativity Space. That's what it's called? Yeah, Relativity Space. What do they do? They do 3D printing for space rockets, for rockets. Oh my gosh. Yeah, and it's enormous. And I think their last valuation was$4 billion, which made my stuff worth like a whole lot of money.

18:52No kidding. Because it was just these guys from Dallas who were talking to me about, you know, they want to use 3D printing to build rockets. I'm like, that's really cool. I asked them questions, did some homework. They answered all the questions great and everything. And so I gave them like$750 ,000 for 20 % or 25 % of the company. Now, I've been diluted significantly since then because they've raised a bunch. But, and, you know, even as I've put in more. But, yeah, it's worth, you know, enough to cover all my bad investments. That is amazing. And I've never met the guys. And you never met them.

19:19Yeah. With the cost plus drugs, Dr. Oshmijansky, that was a cold email. I was going to say, tell the story. That is crazy. The guy just emailed me. Yeah, just emailed me. A guy named Dr. Oshmijansky, who is a radiologist, practicing radiologist. Also has a PhD in math and statistics. Also did one year of law school just for the fun of it. I mean, just insanely smart. Everything comes easy to him intellectually. And he sends me an email. What was the subject line? I don't even remember. Um, but it was basically saying that, um, he wanted to create a compounding pharmacy to, um, to make generic drugs that are often out of supply.

20:01Right. And because they're out of supply, the people who make them can charge anything they want, because if you happen to have that disease that needs it, you're going to do it all you can to get it. And I'm like, well, that's pretty cool, but that's too short-sighted. We got to do it for all generics. Right. And so, um, this was going four years ago, we started what turned out to be a company called costplusdrugs.com. And I kind of massaged the whole business plan and invested. And basically, we have built this company. If you go to costplusdrugs.com, we tell you exactly what our cost is for any drug we sell.

20:34We just added 113 more today. So now we're closing in on a thousand different SKUs. Today alone? Because yesterday you added a bunch of them. No, we reduced prices yesterday. Oh, those are the, okay. And added a bunch today. And so just the fact you're reducing prices on drugs at all is insane, right? It's amazing. That's a real problem. No, it's a huge problem, right? That's why we did this. And so now if you go to costplusdrugs.com and you put in a monotel, which is for people with leukemia, as I found out, and you can see that our cost is$45 and we sell it for, or$48 and we sell it for$54, right?

21:10You'll see our cost. We add 15%. That's it. It's$3 for the pharmacy handling fee and$5 for shipping. That's like a game changer. It has been. That is a disruptor. It's changing a lot of things. You know, it's crazy. Some things that we didn't even expect to see. Somebody, because they see our costs, let alone our pricing, now they're able to back into a lot of the bidding that goes on for different insurance companies. And somebody did some research that said, if for just 77 of our drugs, buying at basic quantities, if Medicare bought from us instead of where they buy now, it would say$3.6 billion a year.

21:51And that's just 77 drugs. And, you know. That's crazy. Yeah, now we've got more than 900. So you can see where it's going. But in this country in 2022, we should never be in a position where you have to choose between your rent, your food, and your medication. Yeah. And we've been able to change that. And we thought we were going to primarily deal with people without insurance. But as it turns out, not only were people without insurance really benefiting and saving a ton of money, but people with insurance were more often than not cheaper than people's co-pays. Yeah, that's what I was going to say.

22:25You could have co-pays a loan are so high. Yeah, so I mean, you might have a$25 co-pay. Yeah. You know, and if you're buying a drug that costs less than$25, you're saving money. Well, actually, the other thing is like you have to hit a minimum. So for me, I don't even bother. I have to just pay out of pocket until I hit a place where it's so expensive that like this, even like it doesn't even matter where you are socioeconomically. It's so helpful. Yep. So check us out, costplusdrugs.com. Just go in there, look for the medication or your parents or your aunts, your uncles, your grandparents, whatever.