Adam Sandow - The Power of Print Media - [Invest Like the Best, EP.376]

25:17And I couldn't have done it. I really, really could not have done it without the media and the people that worked in those media companies and the relationships that they built with the biggest brands in the world that had a love and a trust for my media brands that would at least listen to me. And there were many, many meetings where I'd say, look, this is years away, but what if? and we start to hear designers and CEOs of these design companies, the manufacturer, carpet, tile, paint. And what I love is when they say to me, Adam, my God, you built that, that could change the industry. Patrick, how many times do you talk about here on the podcast, like marketplaces?

25:57We need two sides to really make that flywheel work. And we had both sides at a pretty amazing level. And we had that trust. So it was amazing. I remember going into a meeting with one of the largest architecture firms in the world. And I was walked in by one of the board members and it was a big group of people in a meeting. And he says, you might not know who Adam is, but you know what he owns. And he talked about all our magazines and things. And I never forgot this. He said, he's a friend of the firm because what have I done for 50 years? Written about them, awarded them, inducted them in the hall of fame.

26:30He's a friend of our firm. And he's got this crazy idea. He wants you to help him refine it. And these were all decision makers in the firm. I'm walking in with this relationship and this trust where we're going to help him with this because he helps us. And it was those moments that stuck in my mind as these things that you can't do as an outsider, no matter how brilliant you are and how much cash you have. It's very hard to do that in certain industries. And we were fortunate enough to have worked really, really hard in the media businesses and employ incredibly talented, brilliant people that helped to build those brands.

27:08And that allowed me to move to the next big thing, which was, okay, let's try and change how the whole industry runs. And that led me to invent and build and then really scale material thing. Let's tell that story now. And just to put some perspective for those listening that aren't familiar with the business, It'd be hard to imagine even if you took all your design-related magazines and maybe all the ones in the world, they would not be valued collectively at$2 billion. That's the last number I saw for the valuation for material banks. So the business built on top of this trust and distribution that you just talked about is worth probably a lot more than the media properties themselves could ever be.

27:46And so it's a great excuse to tell that business story. and I guess going back to the original problem to use your theme that you encountered in the industry and how Material Bank and how you solved that with the business and the founding moment of it. Yeah, I started to do what I always do. Everyone that works for me, this will sound very familiar. I started to ask about pain points and I started to make sure that these weren't marketing pain points. These weren't, what do you think I can solve for you? I said, tell me what are your problems just in general. As a designer, tell me about frustration points.

28:20As a CEO of a company that globally makes carpet, tell me your frustration points. What I started to see was this physicality of our industry was becoming a real pain point. So here is, in essence, the problem. You sit with a designer and the designer would say, look, I'm building a hotel. I've got a spec, 80 ,000 square feet of marble for this incredible hotel. and I've got to find just the right product. Well, when a designer does that, they spend months looking, they're getting samples, they're doing all kinds of things to make that decision. And by the way, as they get further and further in the design process, now the client, the owner is starting to get those samples.

29:04These decisions are made with these physical samples. Now you go and you switch to a manufacturer and you say, tell me about pain points. And they'll say, well, marketing is harder than ever. Google, the rates are unimaginable how expensive it is. It's getting harder to market. Our reps can't get in to see designers like they used to, just harder in general. And oh, by the way, 12 % of my revenue goes to sampling. 12 % of your revenue? Yeah, sampling is not going anywhere. And by the way, I don't care how good the goggles and haptic feedback gloves get. You're not specking 80 ,000 feet of a marble by going, well, it looks good on the goggles.

29:44Let me go ahead and buy it. You might cull down from 20 marbles to three, but the physical review of a sample to make a buying decision is this essential, messy, complex step. And I remember someone that worked for me at the time many years ago, and I said, I've got this crazy idea. And I would talk to designers and see, I'd pose this to everyone. And I said, what if I could change the way that whole process happens? I'm going to go tell you a little side story. I am obsessed with collecting data points and knowledge. My brain does not turn off. I feel like all I do is collect data points and I collect just bits of information and knowledge my whole life.

30:28And I've got this curiosity for everything. I'm immensely curious about everything. And there was a company called Micro Warehouse. I think it was owned by Felix Dennis, who passed away. You know, Max, brilliant English businessman. And this was in the 90s. And Micro Warehouse, company that was ahead of its time. I would get the catalogs. And on the cover of the catalog, I remember it like it was yesterday. There was a woman with a headset on and it said, order anything from our catalog by 3 a.m. and you'll have it tomorrow. This is the 90s. Amazon wasn't even a thing. And I would only order from them because in the 90s, I was wearing every hat and I was building my company and I would drive home at midnight from working all day and night ordering a laptop for some employees starting the next day.

31:17One night I call and I'm talking to the operator. I'm literally driving, giving her my credit card over the phone. And I said, I have a question. How the hell are you getting me a laser printer, a CRT monitor, and a computer tomorrow? She goes, oh, sir, that's really easy. She goes, we are at the DHL headquarters. It's like I heard nothing else the rest of the night. It's the most brilliant thing I've ever heard in my life. And then why isn't every warehouse at the DHL headquarters? But by the way, I'm not price shopping at three in the morning. I'm getting whatever price they're giving me because I want it tomorrow.

31:47Obviously, Amazon took this and ran with this, let's say. But Micro Warehouse was this incredibly visionary company that would get me everything the next day. And this is the 90s. I'm driving in my car at midnight. That never left my head. It literally never left my head. So fast forward, and we're building Material Bank, and I'm talking to designers. And I said, tell me about sampling. I said, wow, it's kind of a pain. We sometimes have a little closet. It's very messy and disorganized. But usually I'll go on the website, I'll fill out a form and in a week I get the sample or I'll call a rep and bring it over to me in a few days or whatever.

32:25And I said, how many samples do you get? And like, oh, we get thousands. This is our job. I'm like, well, that sounds pretty unbelievably slow, inefficient, not even sustainable. Getting boxes. And they're like, oh my God, you come to our mailroom. I'd go to mailrooms and there was hours of tape boxes and bricks and glass and these handmade boxes. It was a mess. So I go to manufacturer and I would say, how do you handle samples? I'm like, well, we've got eight guys in our warehouse and we're in St. Louis. So at two o 'clock, we cut off. We ship everything ground because we're not going to spend the money.

32:56And it was a mess on both sides. It was just a bloody mess. And I would start doing focus groups with designers. I'm like, hey, I got a question. If there was a website that you can go on with every manufacturer you cared about and And all their data was there. All of the photos were there. And you could request samples for free as a designer until midnight. And then at 1030 in the morning, this beautiful, I spent a year designing this packaging. This beautiful package shows up at 1030 on your desk with every material from every manufacturer. And they were like, I don't believe you. I'm like, no, no, I think I can build this.

33:34There's no way. and designers would say that would change the hours that that would give me back. The boxes that would save, the mess you would save. And then I said, what if I could turn that box I sent you into a return box, postage paid, whenever you don't want the samples, keep what you want sent back so I can put them back on the shelf. So designers were already, I stopped doing focus groups because they're like, Adam, you'll never do it. We would never use anything else. If you could do that game over, but come on, how are you going to get these materials. How are you going to aggregate it all?

34:06How are you going to do it? So I went to, I won't say who, but one of the people used to work for me, a top guy. And I said, I've got this crazy idea. Again, another side note, I will never build a business pure digital. Never. They're too hard. They're too hard. You wake up one morning and your business has been taken over by Microsoft, Amazon, Google, startup kids. I don't like pure digital businesses. They're too hard to build. Your failure rate is just astronomical. I don't like pure digital business. I like things that are messy and complicated because the pain to do what I want to do with material bank is not the pain the average person or the average startup would ever do.

34:49So I like that barrier. So then I went to manufacturers and I said, I would walk into a meeting and say, I'm jealous of Google. What do you mean? I'm like, well, Google has the best ad model in the world. Google's ad model was, hey, we'll run your little link as many times as you want. We won't even charge you for it. But when someone clicks, we'll charge you two bucks. Greatest ad model ever. Amazon and Google, they each have their different models. But this Google AdWords model, as a publisher, I was bloody jealous of. So I said, how can I build a model? Because I know the design, I know the demand side will be there if I can do it.

35:24Hard to do, but if I could. But how do I create a model that is compelling for a manufacturer? And I looked at that Google AdWords model and I thought, well, this is so brilliant. And I started to talk to manufacturers like I got an idea. I'll take every piece of material, every piece of data. I'll do all the data work myself. Don't lift a finger. I will literally build and normalize your data structure and put it on my website. No cost. I'll take every sample you have, bring an 18-wheeler, back it up to my building. I will load it into my warehouse, no cost. I want X dollars every time I find a designer that I've qualified that says, I love that carpet.

36:03I want the carpet. I'll FedEx it overnight. I'll put all of that data right into your CRM. So your salesman doesn't have to do anything, but wake up, have his coffee and go, who got my samples? Who do I follow up with? And I'll charge you transactionally. I'll charge you cost per action. So manufacturers are saying, wait a minute, no sampling, no warehouses, no nothing. No, you're just going to put leads into my CRM and I'll pay you transactionally like Google. Done. So we were able to build a model that supply and demand sides of the marketplace were very happy with. And because of that media platform that I spent the prior 20 years building, I had access to customer acquisition, which is, again, talking about the hardest thing in any business with digital.

36:49It's your customer acquisition cost and your lifetime value. Well, I had this ability to enter the firms. To this day, our media company still drives the awareness for Material Bank. We were able to build this really, really innovative model. But what I had to do, and where that story of micro warehouse comes in is, even our research showed a seven o 'clock cutoff would be so beyond expectations. forget it game over they would love it i said to my coo i said we're going to do midnight because there's one place on the entire planet that you could do that it's memphis tennessee because of fedex there's no other place on planet earth to do it so i've never been to memphis he'd never been to memphis like we're going to memphis and we're going to find a logistics provider because we've never been in logistics we go to memphis we have two big meetings we meet with fedex and we say to FedEx, we will be the number one shipper of priority overnight packages out of Memphis.

37:53Please help us get there. And they were amazing. FedEx has been an amazing partner. They took us serious. They actually really took us serious. And then I went to all these fulfillment companies and we were laughed out of the room. These companies in Memphis were like, you want to have 20 million pieces of material, 500 ,000 SKUs. You want to take a brick and a piece of glass raw, put it in one package and overnight it at three in the morning. Literally, Patrick laughed out of the room. They're like, we're not interested. You'll never do it. We left Memphis going like no one wants our business.

38:31So we do, we always do. We found an 80 ,000 foot building that was this ramshackle building. And I'm like, we're going to figure out how to do this because the value of mastering midnight cutoff, overnight delivery to the country is a big value. And I didn't want seven o 'clock, I wanted me. So we hooked up with a robotics partner called Locust Robotics from day one. They were just starting out. We were just starting out. The CEO loved what I was doing. And I said, I'm going to build my business on your backbone, on FedEx's backbone. You got to help me. And they did. And we spun up our first logistics operation.

39:07And in May of 18, we literally were doing midnight cutoff of everything. We invented packaging, everything that was done. And today we're in a massive facility handling, you can't imagine the volume, hundreds of robots and an amazing team of people. But you can order tonight at$11.58, 89 pieces of material from 25 companies, and you'll have it at 1030. And our failure rate is 0.01. Our team in Memphis, our chief logistics officer, Steve Smith, is just incredible. That warehouse doesn't fail. And it's now become, many years later now, the utility that the industry runs on, because that's where everyone goes to find materials when they're looking to source it.

39:54And we've got today, we're probably a third of the fortune 1000 companies that use us. So it's not just architects and designers. You've got some of the biggest corporations in the world, their teams sourcing materials and we connect them right to the manufacturers. It's an absolutely incredible business story. I love the notion that you don't like pure digital businesses. And I love the notion that it's all built on itself. You've slowly been learning these lessons. The next thing is always built on the shoulders of everything you've done before. So much of it rests, if you go back to the beginning, on delivering a fantastic media product with great content and high quality content in it.

40:33What have you learned about that notion, about what high quality content means for a given audience and how to find people that can produce it reliably? Because in the quest for more eyeballs, like you said, the games that people would play to have a higher quote unquote circulation, I'm sure that quality suffered and your efforts have always been about the highest quality content. So what are the variables of content itself that you still adhere to today as you think about building or buying a new media property? Well, it starts with having the best people, the people that are at the foundation of our editorial products have been here a really long time.

41:12They're honestly the best in the industry. And because we don't play those games of clickbait or any of our websites, so when you allow the editorial teams to really do what they want without the constraints of a lot of media companies today that are just constraining them to produce a certain kind of content for mass eyeballs, that is, in my opinion, absolutely the way to lose is to do that. So I try and find the best people and give them a lot of autonomy to allow them to do what they do best. And it used to be that way. They used to have these editors that were exalted and just powerful. And that doesn't happen anymore because a lot of the media, and this goes across all media, has changed to that mass eyeball.

42:03They're not going to compete with TikTok. They're not going to compete with Instagram and TikTok for literally mind share or podcasts as a category today. So you better have extraordinary content. It's got to be special. And that was my attitude from the beginning. When I built New Beauty, I said, how do I create a different kind of beauty magazine? There was other beauty magazines out there. They're gone now, but there were a bunch. How do I create something really special? I did something unique with New Beauty. I went ahead and I built an editorial advisory team of some of the most important, best minds in beauty.

42:39Now, this is beauty from nutrition all the way to plastic surgery. And we got these incredible people that helped us create guardrails for the product. And to this day, I mean, literally, the chairman of the editorial advisory board, Dr. Robert Singer, is still the chairman from the day I started that magazine. One of the most important successful plastic surgeons now retired, but he guided us. We didn't know what the heck we were doing. Even our editors were early. So we were able to be guided to have as our own integrity to make sure that our content was vetted properly. Media companies don't do that.

43:14Certainly 2005, no one was handing over a lot of power to a board from a privately held business. But it allowed us to have an incredibly high value of editorial product that to this day is never wavered. but I just never felt right to chase what everyone else was chasing. And now, if you look at some of the biggest digital media companies that have blown up, companies worth$5 billion, they're the future of media and they're already gone or in bankruptcy, who would have thought? So it's just a tricky, very tricky industry. It's not an easy one. Maybe we could talk a little bit about the build versus buy decision in media properties, because you've done both.

43:48And so obviously, sometimes it's appropriate to buy a storied 100-year-old brand or property. Sometimes you build something from scratch. What are the considerations that go into one versus the other since you seem to be willing to do both? Look, I think if you can buy a brand that's got a story, a heritage, a reputation, it's always better. Obviously, it depends on the deal, depends on structure, depends on how well the brand is received. Sometimes in the media business, they kill the brands and then you can buy them and they're not worth a lot because they're a bit bastardized. But I think there's a lot of great media brands that could eventually be bought.

44:24And there's something to do with heritage. It's like licensing business. Brands are resurrected all the time and re-imagined. There's something to be said for that history. I like a story. When I bought interior design, we were given the archives going back almost 100 years. And I love that. To go back in there and see what were people talking about 90 years ago about office design or home design. Worth is another one. Like the archive of Worth is a brand everyone knew. So when you reintroduce it, there is a credibility. And again, if you look at what we did with Worth, some of the most beautiful magazines we've ever produced, we did illustrations on the covers.

45:04It was just absolutely gorgeous. And it really resonated with the industry. If you can buy it, I'm a big believer in buying. I think today building is hard. Still, I love to build brands and we're constantly building new things, but we're still acquiring. We acquired a 15-year-old design website called Design Milk. I bought that a few months ago. We're about to buy two more digital platforms in the design space just because they fit in our ecosystem. So I'm a big believer in buying. I love to build. I'm a zero to one builder. I love to invent. But if you can do that on a brand that's got credibility, I think it's even better.

45:41If you were teaching a class about building a brand from scratch, in media specifically, what would that syllabus look like? What, in your experience, have been the most important things to nail to do that zero to one, which is so hard to pull off? The most important thing, forget brand, forget design, forget quality, is what is your value proposition? The world doesn't need another whatever. So what are you doing that's unique and special? I have never built Me Too businesses, and sometimes to our detriment. I've never followed whatever wave is coming. A lot of times people come up with great ideas, whether it's a magazine or anything.

46:20I've got a great idea for this. And maybe even the TAM is there. But what is the viable business model? Again, because I fund everything myself, there is no down round for me. I spend all of our money doing dumb things. We go out of business. So I try and find businesses where it makes sense to me. And I feel that there's an incredible value proposition that I'm delivering to the user, to the reader, to the customer. and there's a business model attached. And if I was teaching a media business today, that's where you have to obsess. Where is there a hole? And by the way, really hard to find holes today, but they're out there.

46:56I'm sitting on this few ideas I've had that I wanna build. I'm so busy on other launches right now, but there are holes in the market, but you've gotta have a real reason for being. If you're just being a me too, the world doesn't need it. And now you've got to basically outperform, out-operate an incumbent, which maybe you can do, maybe you can't. But I never wanted to be that guy going, we're just like that one, but we're cheaper, or we're just like that, but different. I don't know. It's not exciting for me. I think that I would urge anyone in media, certainly, so I have a love for it. What's different?

47:32Where is there a brilliant business model attached to it? Where is there a need that's underserved? There's a niche you can go into because there's a lot out there. I mean, today, fighting for attention is everyone's fighting for attention. We literally live in a world, if you look at the old science fiction movies of the guy walking down the street and billboards talking to him and things flashing and things hovering and that's the world we live in today. Our attention span, you go to a website and you're like, what's the average time on site? 38 seconds. That's pretty good. Like, no, no, it's not.

48:05That's not great. But in the world of web, you're a minute. My God, you're killing it in a minute. tough. So where do you find those really juicy needs where there's an underserved or completely missed market? And how do you do it differently? I had a group, they ultimately didn't win, but they were trying to buy Time Magazine. And I sat and I brainstormed a half a day with them on how I would re-envision Time Magazine. And it was tough. I had some ideas, but it's tough. How do you do that? You can, but it's tough. But we're seeing, I mean, look, Life Magazine was just bought by Kushner and amazing brand, great heritage.

48:42You can probably do something incredible with that, but it's got to be something special or it's going to get lost. So they're out there, those opportunities. And I love those heritage brands personally. I'd love to come back to the two-step process of problem identification in the audience that you're serving and then business model innovation and take them one at a time. How have you gotten better in all the times that you've done this at getting to the core problems? Because there must be more to it than just you show up somewhere and say, tell me what your problem is. Maybe that does work, but you have the Henry Ford thing if they'd want faster horses or something.

49:15So what have you gotten better at in this part of the problem identification of knowing who to talk to, how to talk to them, what sorts of questions to ask them? I ask a lot of questions. And because, like I said, I'm constantly, as a human, collecting data points on everything. and because i'm so naturally curious i take it as a challenge to find the problem i don't get the answers i never talk to people tell me tell the problem and they hand me an answer but it's really the way i have this iterative process of absorbing the information and really thinking about it and i parallel path the thinking with the business model and i literally will sometimes do this by hand i'll sit with my notebook and i will fill 20 pages of handwritten math manual math thinking through the business model everything at once the only way i can explain it is i do everything at one time i envision the solution the business model the economics the look the feel i do everything at one time and that is something it's a gift from my parents i guess that's where my brain works but that's what i love and it's something i've done my whole life because at the end of the day, when you start your own business, I was a salesman.

50:29I had to go sell the ads. I needed a really great pitch and I would talk about what the ad could do for you and how can we design the ad to deliver the solution? So this has always been ingrained in me. As a media guy, you would have built material by going, let's just charge a monthly fee for the listing and horrible model. You're limiting. The business would be a tiny peanut business today. So I take a lot of pride in the engineering of the solution and the refining of the solution. I'll come up with the answer. Literally, when I came up with material, I'm like, oh, we'll figure out fulfillment.

50:59I know I can figure it out. If other people could figure it out, I know I can figure it out. I didn't let that bother me. Whereas a lot of other companies may have said, where's your logistics team and how do you build it? If I've got a viable way to generate a lot of business, I can feel like I can build almost anything. Is the same set of principles the way that you have great relationships with advertisers? Are you training your teams to ask the question of not just send the ad you on a post, but instead, what are your problems? Help us engineer the best advertisement that's going to get the solution that you want.

51:31What have you learned about the keys to good relationships with advertisers? It's how we run our most important relationships. I mean, sure, we sell ads, but our most important relationships are solutions to their problems. Our media teams do that. Interior Design rolled out a new program. The CEO there is Erica Holborn. She rolled out this new program called Max, and it's an entirely new solution, turnkey, really comprehensive solution to companies' problems at many levels. Every one of our brands does that. We've always had to do that to keep ahead of our competition, but it's the same thinking.

52:08Before I had anything else but media, I would sit in meetings going, what are your business problems? Well, we have a problem getting our reps into architecture firms. They literally will not take our call because they love our competitor and they hate us. Okay, let's figure out how to use the tools that we have to accomplish a solution, not just what ad would you like? And we've always had that DNA and I've just taken that DNA further now to other industries. And a lot of our expansion into new businesses from our media platforms are all from that. What have you learned about buying well? So in the deals that you've done, especially when I'll use the word distressed in some cases, some of these legacy brands, a hundred years of heritage, but a bad current business as you're looking to buy it.

52:51And obviously you're going to come in and change that. What have you learned about the bidding process, how to price these things, where they tend to price considerations in M &A in this space, that's just different than I'm sure than buying a software business works or something. Yeah. Well, because I use my own capital and certainly bank debt on things when we need it, But because I don't have private equity in the business or we don't raise capital, I mean, we raise capital for material, but that was it. When I buy things, we're typically value buyers of distressed product. We're not a roll up buying incredibly high performing assets and trying to roll them up.

53:26I think that's a really tough thing to do in media. So we tend to buy things that we look at and say, under our cost structure, with our team and our ability, I believe this could become accretive pretty quickly. We tend to look for those kinds of deals. Today, we're not buying as much. It's just not a core part of my strategy. I prefer, unless it's something really special, like Interior Design Magazine was, the idea that this was even available was shocking. But it was the time. There was no buyers. No buyers for this asset. chance of a lifetime. It would be a little startup business buying Vogue, pretty amazing.

54:03Those opportunities don't come around a lot. And a lot of the times the media is just too beaten up. It's too hard. In really good, frothy times, I build. And in really bad times, when the world's ending, I buy. What else would you say is important or surprising about print, the physical thing itself that you've learned is important about running a good print publication or something or something that print unlocks that digital doesn't, just like anything we haven't mentioned or said about the importance of print. Patrick, here's the most important thing. Here's the thing that I believe in more now than I ever have.

54:38I like boating. When I sit at my desk, I give myself time to look at one of the boating magazines I like. I'm not distracted and I'm captured. There's no blinking things with messages. I'm not flipping on TikTok. There's nothing blaring. I'm in the moment and it's getting my undivided attention and that's a luxury now I'm more curatorial than ever of what I will do that with I picked up a business magazine in the day I couldn't wait to get through it the paper was vulnerable the advertorials everything about it was terrible there was someone on the cover I wanted to read about and that was it and I couldn't wait to be done drop in the trash other magazines if it has a place on my desk or at home I think That's where print shines.

55:23It's hard to capture the imagination. You need the right mix of content, quality. It's got to be the right niche. But if you're into these things, if you're into home and design, and you're really dreaming about your next home, you want that peace and quiet. You don't want the blinking banners. You don't want things popping up. Here's the best example. Go on and read an article from a popular news site on your mobile phone. You want to throw your phone across the thing. There's trick banners, things, pop-ups. You don't know where the article stops. It's just so much garbage. And the reason there's so much garbage is that media company desperately, desperately needs you to misclick on a stupid banner to get the two pennies.

56:06And that is a recipe for disaster. And I can't tell you more times than not, I will follow a link to an article and I will abandon the article because there's 12 pop-ups or there's fake this and this. And it's unbelievably irritating. So my time is more valuable than that. So I think that's where print comes in. But it's part of an ecosystem. It has to be, in my opinion, part of. And there's a time for that print when you can do it. It's the same thing like a podcast. Why I think I love podcasts so much, and I think why they're so popular, is that you're giving yourself that time. There are podcasts I listen to an hour, an hour and 15 minutes of my life, and I've focused on one thing.

56:45That is deep, deep, deep value. you can't compare that to bouncing on a website or flipping a social media thing. So I think print goes back into that. And I think when you build that ecosystem where it is a component of that's where the one plus one is five. And I think it's a necessary evil. When you are designing the business model itself behind the distribution, have you ever done it where you had the equivalent of the material bank in mind and then built or bought the magazine or the media property to serve that end thing? Or is it always the other way around? No, so the new baby that I'm incubating, which is another technology and logistics business having nothing to do with design, but very much technology and logistics, a much bigger industry, candidly, B2B and B2C.

57:33We are actually doing the reverse. We're inventing a one-of-one business that's never been built before. And we're taking a media property and completely pivoting the media property to dovetail right into the editorial content that will help support this and help us build that ecosystem. So for the very first time, we're doing it the opposite. We're starting with our business thesis. We're building out this technology company and building the media, but we're building it on an acquired platform that's got massive user base and tangential users that we think will dig this particular content. I think it's important.

58:11I think it goes back to that ecosystem of having this multidisciplinary media ecosystem to help build those value creator businesses that to your point, could be worth a hundred X the media or more, but they work together. I just think media guys have just not done enough of this. They're sitting on great assets and they're still thinking media. And then you got the startup guys thinking of startup and they're both pretty far apart. You mentioned earlier, sometimes people build a single business and all their wealth is tied up in one thing and they work on one thing forever. you've done something very interesting, which is really, I would describe it as building an ecosystem.

58:44That's a word you've used a few times where everything's built on the last set of things. They're all sort of intertwined. They're like a cross compounding effect that happens. And this is a very cool way of building that's appropriate for some entrepreneurs. What advice would you give to people that want to do that sort of thing? And maybe another way of asking it would be like, what have you done wrong and corrected and learned from to nurture an ecosystem of businesses and brands versus just building the one company that so many people do? Yeah, I've always been a builder versus a flipper. And I don't mean flipping in a bad way.

59:20There's a lot of founders going, I'm going to build it. I'm going to raise capital. I'm going to exit and I'll go on to maybe the next thing. I've always taken a long-term approach to every single thing I do in my life. I have never built a business going, okay, I'm going to start it and here's my exit plan. And we have exited some businesses and have done really well in those exits. But for the most part, I've always liked to build and hold and see what I can build on top of. And I think advice is starting with building a business that is really strong and it's got a good model with good economics because one feeds the other.

59:58So if you can build something the cash flows and use that cash to build the next thing. That to me is the magic. You're not selling it. You're not flipping out of it. You're using the cash flow to build the next thing. And I've done that my whole life. And by the way, Patrick, sometimes it's been really, really hard. You start to use bank debt. Economies change. It's easy to look at certain things we've done and go like, my God, it's billions of dollars of value created. But when you're on your own, when you don't have partners, when you don't have investors, when you don't have a board. It's unbelievably liberating and free, and that's how I'm wired.

1:00:34But you're also one guy, and when things turn and change, everything else, I'm the guy that's got to fix it. So very careful to build businesses that allow you to build the next, the next, the next. And Material Bank was unique. I knew that I had the potential of something very, very big. and we funded a lot of it the first few years and a lot of capital myself. But I made that decision. I said, this is a business that is going to be bigger than just another piece in my ecosystem. And if I don't raise capital, I run the risk of not scaling it fast enough. Now, Material Bank today has scaled massive operations in Europe.

1:01:18We've got a partnership in Japan. We're looking in other big countries. It is a global business today. I raised capital and made that decision to bring in outside investors, but I was always in control. And to this day, to control the board and to control the company, because I took all those early risks. So I wasn't raising seed capital and then raising a series A. And then by the time you're on your C, you've lost control of the board. And we were lucky enough to find, and I brought in an incredible CEO, incredible background, amazing person, is now the CEO. And I've moved to executive chairman, which again, frees me up to build the next thing.

1:01:56So you got to start by making sure that those foundational businesses are good, that can help you grow. There was a point where it was just so, you talk about mistakes. One of the mistakes I made early on was I didn't build enough leadership in the company. So I was doing everything on every brand. I've addressed my team in the times when I'm the most proud. If you were to say to me, Adam, what are you the most proud? It's actually when I build something that I turn over to a leader and they continue to be successful and grow without me. Because I truly believe in it. No ego at all, but I just have the mentality that I will figure it out.

1:02:38I don't care what the hell happens. I will figure out how to make it successful. I will work a hundred hours a week. If I have to, I will build it. I will make it successful. So through sheer force of nature, I feel like I can do it, but that's not sustainable. So when I can build something and hand it to someone and I can come in for a quarterly meeting and I leave impressed going, my God, they're killing it with this business. That to me is what I feel like most successful. And I'm most proud is it's living beyond me. So I can go build the next thing because I love that zero to one. If you could only receive one magazine in print the rest of your life, not counting ones that you own, what would you pick?

1:03:15I mean, it's hard to beat The Economist. Although if it was the only thing I could look at, I think the diversity of Monocle, I would have to say, would be an interesting one. It's hard to get through an issue. There's so much content in there. But Economist or Monocle, I think, are two really good ones that are hard to beat. Adam, your story is one of the more interesting business stories I've come across in a long time. I really appreciate you sharing it with us today. I ask everyone that I interviewed the same traditional closing question. What is the kindest thing that anyone's ever done for you?

1:03:43I knew you were going to ask this, and I've not gotten this question before. Can I point to one thing? I got to tell you, I have incredible parents that have always given me incredible advice and support through all of my endeavors. And I think that this constant support, good times or bad times, It's something I try and do to my two girls. It's given me an underlying ability to do what I do. I used to joke back in the early days, like, what's the worst that happens? Business goes out of business. I move with my parents and I'll get back on my feet. But I think my parents were always incredibly supportive of success and failure.

1:04:18And it's something that's always stuck with me. And it's something that is hardwired into me with my two kids and my wife. It's a foundational building block that I think is essential in life. And I was lucky enough to get it. And I think I give that to those close to me. Simple and beautiful place to close. Adam, again, thanks so much for your time. Patrick, thank you so much. If you enjoyed this episode, check out joincolossus.com. There you'll find every episode of this podcast complete with transcripts, show notes, and resources to keep learning. You can also sign up for our newsletter, Colossus Weekly, where we condense episodes to the big ideas, quotations, and more, as well as share the best content we find on the internet every week.

1:05:12Outro Music