What Mint Mobile's $1.35B Acquisition Can Teach You About Marketing

0:00Welcome to Marketing School, the only podcast that provides daily top-level marketing tips and strategies from entrepreneurs that practice what they preach and live what they teach. Let's start leveling up your marketing knowledge with your instructors, Neil Patel and Eric Hsu. All right, now we're going to talk about how Mint Mobile's$1.35 billion acquisition can teach you about marketing. So let me set the stage here real quick. Mint Mobile is a wireless company. They call themselves a mobile virtual network operator, whatever you want to call it, that operates actually on the T-Mobile network.

0:38So Ryan Reynolds, who is also known as Deadpool, I think many of you have seen him on many different movies. He's a movie star, but he was kind of the face of this brand, right? So there's a couple of things here that we can learn from it. I just want to set the stage here. And also I'll share a story as well, because one of my EO forum members was actually one of the co-founders of this company. Neil, you want to kick it off first? Well, first of all, I don't think Ryan Reynolds created this company. I think he joined and they gave him equity, right? Correct. So they gave him like 20, 30 % equity or something?

1:10He got$300 million is what has been written. $300 million out of the$1.3 billion. Yep. That's an amazing deal for him. And you know what's crazy? I don't know this for a fact, but I believe that's more than what my buddy got out of it. And he co-founded the company. But you know what? Without Ryan Reynolds, he would have never got that amount. Mm-hmm. Yep. So when you think about Mint Mobile, there's a lot of carriers out there. There is Boost Mobile, Mint Mobile. Anytime you're in a saturated space, you need to figure out a way to stand out. And celebrity endorsements can help you stand out. But here's the thing that most people get wrong with celebrity endorsements.

1:49They don't work that well because the celebrity is detached from the brand. They don't really care about it. They're just promoting it because they're getting paid. But on the flip side, the reason Mint Mobile, in my opinion, worked really well, and you've seen this in many cases with some of the rocks brands, like his energy drinks, Kylie Jenner, her cosmetic company, Ryan Reynolds with mint. The moment he's owning some of the equity or celebrity owns it and they're vested and they care about the product and they're going to do whatever to really make it popular. That's when it's game changing.

2:20Just paying a celebrity or influencer to push a product does not work the same as having them being a part of the company. and that's a big thing that marketers should take away from it. The best way to look at this is you have short-termism versus long-termism, right? If you give someone equity, they're more focused on the long-term. If you give them cash, I'm not saying a cash payment is bad, but it's more short-term. And typically celebrities, for better or worse, celebrities or movie stars, whatever you want to call them, they're typically in it for the short term because so many people just want to give them money.

2:53And so they're just like, oh yeah, pay me to be here or pay me to endorse this, which is why, by the way, on a separate thing, there's a lawsuit going on with a lot of celebrities out there for promoting crypto products, right? So Kim Kardashian got paid, right? I think one of the Pauls got paid as well. And so that's short-termism. And again, it's just a way of doing business, right? But the quote I keep coming back to at the end of the day is the Charlie Munger quote is, show me the incentive and I'll show you the outcome. If you align incentives properly, then you're going to be able to get better outcomes.

3:22And the other thing is for Ryan, the way he's actually been pretty involved, not necessarily in the day-to-day of the business, but he's been pretty consistent with pushing Mint Mobile over the years, right? Because some people sometimes don't just get equity and they're just kind of just back out and not kind of deliver on what they promised. But he's thought more like a businessman because they bought like a football team, you know, in, I think in England, right? They're trying to move it up to the Premier League, kind of like the Ted Lasso story, but he's been pretty involved with Mint Mobile and he's continuing to not only build his brand with movies, but he's getting more involved with business deal.

3:53So it's also important to think about who you align yourself with, because if you're aligning yourself with a business focused celebrity, that's going to be better for the long term, because ultimately they have the knowledge and they understand what you're trying to do versus someone that might be newer in their career that might be blowing up. But because incentives aren't a lot or they don't necessarily have the knowledge, the business knowledge yet, they might not necessarily help you achieve the outcomes that you're looking to achieve. Now, that's one piece of it with Ryan. The other piece is sometimes it's okay, Like if you're starting a business, it's okay to have the humility.

4:21If you're one of the co-founders to take a smaller chunk of the pie and to understand that, Hey, you know what? Again, without Ryan, you know, we're not going to be able to get the outcome that we want, but with Ryan, we're going to be able to get an even better outcome. So, you know, I appreciate, you know, kind of the humility that I have from not only just my friend who's one of the co-founders, but the other co-founders. Cause I think it's like, it's like four or five co-founders, not even including Ryan Reynolds. And they've done a handful of businesses together and to see them grow over the years like that.

4:46and to maintain that humility and to be able to work together, not only on one business, but multiple businesses. There's not many people that do that. Neil and I know a handful of people that have kind of stuck with each other over the years. And it's always worked out well because there's that trust factor. Don't look at, if you have a celebrity that you're joining in a partnership with and you're giving some equity in the business, don't think about what your ownership is going down to or how much they're going to make from it. More so look at the value of the total pie and look at the value of the dollars you're going to end up getting, right?

5:16So here's a prime example of this. If you own 100 % of a company that's worth a million dollars, or you own 20 % of a company that's worth 10 million, sure, 80 % is going to other people, but 20 % of 10 million is more than 100 % of 1 million. It's 1 million versus 2. Logically, you should take the 2. 100%. And we'll use a final example, and then we'll get out of here. But you look at Logan Paul and KSI. So they're both continuing to grow their brands. But it's not only just those two on the prime drink. It's actually three partners. And I remember when we had an insider at the Miami Mastermind, he basically spoke about how they did already$250 million in revenue in a very competitive category, which is drinks.

5:57That just validates what Neil said as well. So anyway, don't forget to rate, review, subscribe to us on the podcast, but also on the YouTubes as well, because sometimes we share the screens. And also don't forget to check out our reaction videos, which happen once a week as well. We would love your feedback on that to see if we should continue that or not. So that is it for now, and we will see you later. We appreciate you joining us for this session of Marketing School. Be sure to rate, review, and subscribe to the show and visit marketingschool.io for more resources based on today's topic, as well as access to more episodes that will help you find true marketing success.

6:33That's marketingschool.io. Until next time, class dismissed.