Why People Hate Agencies

0:00There is one thing I think we should talk about. Let me ask you a question. Why do you think it is that we've tested this in the past whenever you've introduced yourself as a product person versus an agency. person, you get a different reaction. Why do you think that is? So you're saying when I introduce people like, Hey, I'm Neil, I do product. Okay. Maybe I'll just use myself as an example. Okay. So when I used to go to conferences, I would test like, Hey, I have, I I'm in software or Hey, I, I'm in, uh, I have a marketing agency, right? Whenever I would say I have a marketing agency, they start looking around the room.

0:30They want to walk, walk into a different direction. Or they look down on you or they look down on you. I think it's both. They look down on you and they look in a different direction. Now, when you say your product, they're interested. Tell me more, right? Yeah. Why do you think that is? Well, I think people want to know what kind of product you have to offer if you're in software and they're like, oh, can this actually help my life or make something easier for me? If you're saying you're an agency person, they look at it as like you're pitching them for their money. If you say like you're a software product person, they look at it as like, oh, maybe you have a solution to a problem that they have.

1:00Yeah. So the way I look at it, Neil, is when you have good experiences with the product, you know the product continues to compound and you know it's reliable. The problem, this is why I think a lot of people don't, they dislike agencies, is they've had a lot of bad experiences. Because once you find a really good person at an agency, you want to work with that person forever, you're going to try to get max utilization out of that person. That person ends up flaming out sometimes, right? No, that's why a lot of agencies, they throw a lot of people at the problem. You have four different forms of leverage, code, capital, media, labor.

1:28Labor is the oldest form of leverage, okay? So agencies historically have thrown people at the problem and that's why they get a bad rap, right? Versus with a product, it continues to get better. So my point of saying all this is the lesson I was giving to my team is like, hey guys, like I look at our people, like how we build this company as a product too, because we're gonna need to scale and we need to continually bring revenue per employee up. But it's not to say we're gonna cut 30 to 40 % of people just like that, but we need to continue to hire AI forward people. But sometimes people think that I just want to remove everyone and go all AI and like YOLO it, right?

2:00That's not the way. No, it's not the way. And if you lose people who don't have the same thought process and vision, that's okay. It doesn't mean that you're right. It doesn't mean that they're right. You have to do what you feel is right for the organization. Sometimes you'll make the right call. Sometimes you'll make the wrong call. You know, like the person who I lost asked me, why didn't you give me a counter? And then I said, you know, because we evaluate how you get paid within the region compared to your peers. and they weren't happy with that. They're like, but that's not fair. And I said, question for you.

2:36If you got a job locally and you applied, how much would you get paid? A really good job. They're like, maybe half of what you pay. And I'm like, okay. And they're like, but I work for an American company, so I want American wages. There's no winning that argument. I'm not saying I'm right. I'm not saying they're right. Sometimes you just have to move on and do what's best for yourself. Question for you on that one. I mean, he was with you for 10 years. Did he have any incentives tied to his work? Yes. Yeah. So he had really good incentives. Plus, so on top of the base that he had, he was like, are you saying all in?

3:07He was doing really well or just saying, were you referring to his base earlier? I was only referring to base. If you include the incentives in even. All in. So he's crushing it all in. Yeah. Within his country, yes. If you include the total comp, he can probably buy a new house in his neighborhood once every year in like three months or two months. So without giving numbers here, So let's say the new offer that he got was maybe four times what he was getting all in. Like potentially he can make four times. Potentially, right? Realistic, when I was talking to him, he was going to make almost double.

3:42So in my mind, and if you're listening to this, we're not going to name names, but if you're listening to this and maybe one day, maybe Neil will take you back. I actually think Neil might take you back one day. I think it's actually short-sighted to look at it that way, to potentially make double for a person you don't know versus someone you know, like, and trust over 10 years. it's very hard to find that. I'll just put it that way. Yeah, no, but look, I wish them the best of luck. People have to do what's in their best interest and their family interest as well, right? It's just my opinion.

4:10I could be proven wrong, and I'm happy to be proven wrong. Go ahead. Yeah, they went to a company that has extremely high margins. So the company they went to has NVIDIA-style margins. Now, where their big spend is is not actually on physical hardware. It's mainly their own. Their main cost is just advertising, So they have extremely high margins. And I was telling them, I'm like, look, the problem that you're going to face with this company, and I gave them feedback is if you look online at the reviews, there's a lot of bad reviews. So you're going into a place. The marketing is going to allow churn.

4:41Yes, they're going to have massive churn and they already have a ton of bad reviews. And I'm like, they're going to have more bad reviews. So then you're going to potentially have issues, you know, six months. And they believe that the future is pure AI, non-humans. So they wanted to go to a company that believes eliminating humans. And in essence, what they're doing now is they're creating marketing-related products. Think of like consulting, like helping a company grow, but only doing it through AI and eliminating all humans, which I'm not saying won't be possible in the future. But in today's world, if you want to run a marketing campaign for a good-sized organization, we haven't figured out how to do it purely on AI with no human intervention.

5:26Yeah, for the record, I just want to make the record clear here. So Neil and I are very pro people. I think you need great people to run these things and great people to fail quickly. And I think that's always going to continue to happen. And like I mentioned, again, me or anybody on my team right now, we have a Cloud Code channel. Whoever's using Cloud Code right now, they are working harder than they've worked before. So they're not working less, they're working harder. And then the people who don't want to join you for the ride, that's okay. What my thinking is eventually they're going to find something that they like.

5:52And I do think eventually there's going to be enough prosperity where everyone is doing well enough where they don't need to do a job that they don't want to do. But that's like 10, 15 years out. Yeah, I think it's going to take a long time. But on a side note, did you see how Facebook bought Mantis for$2 billion? Mantis. Mantis. I actually think it was$5 billion. I think$2 billion was too much. Where did you see the$2 billion? Everywhere. Really? Let me show you. When did you read? You probably read this recently. When did you read it? Multiple times throughout the day. So I read this. Regulatory stuff as well.

6:26So, okay, here's what I got from Wall Street Journal. Here, let's talk about the strategy in a second. But here, let me share my screen real quick. Wall Street Journal is$2 billion. But it says more than$2 billion. Yeah, acquires an AI startup, Manus for$2 billion. Yahoo Finance, Financial Times, CNBC, they're all saying$2 billion roughly. Yeah, so let's talk about this. You brought it up, so you can kick it off. Yeah, so Manus is an AI company that is quote unquote in Singapore, originally from China. And they ended up moving themselves from China to Singapore, although the Chinese government is now saying they did not do it correctly.

7:04So there may be some regulatory issues or they may try to block the sale. and the price tag supposedly between, you know, financial time, Reuters, et cetera, is between two and$3 billion is what people are saying. But I don't know if it'll go through. The US is okay with it from what it looks like. It seems like China has an issue with them purchasing Manus. Have you used Manus? I have not. So I signed up earlier. Earlier last year, middle of last year, I made a Manus video on YouTube. It got like 200 ,000 long-form views, right? It was like, how Manus will make you rich, boom. and it was really good, but then I churned off of it.

7:41When the acquisition happened, I was like, I wonder how good it's gotten. So I started using it last week. I signed up again and let me give you an example. So remember how I was talking about how the Nine Operators podcast makes like$5 million a year? I was like, you know what? Mattis, help me find all of the advertisers on the Nine Operators podcast and find out the right person to reach out to. And I want you to personalize the email and schedule it for tomorrow and send it for my Gmail. It did it. It did it this morning. that was my prompt it it literally did all of that so in my mind i'm like hey anybody who's complaining about there's not even enough leads there's how about you just go to madison you just query this stuff now and i'm saying it's it's a really good general agent it's been good at making uh custom carousels for me so i saw the the instagram ceo he made these carousels right i was like hey just copy these carousels madison copied it and it made it into a really nice format that i that i posted to instagram like i posted two carousels in the last uh week or so So I think this is really smart for Meta because now they actually have a product.

8:39Before, they were lacking like a chat GPT or any type of product, right? I don't know if they're going to give it away for free. I think that'd be smart. But they have all this intent data now, and you can see what people are doing, and they can continue to train on this data. So I think it's a smart acquisition if it goes through. Yeah. Do you want to know why I don't use it at all? China? Yeah, China. It's okay. I have nothing against China or Chinese people. China is a beautiful country. A lot of my friends are from China. It's more so just data. It's like I won't use Huawei or Huawei. I forgot what it's called.

9:14Their device is, even though they have an iPad that folds and it's like double the size of the iPad so you can watch movies and crazy dimensions. And I really want it because I don't want to potentially have someone in another country like China have access to my data and I don't know what they're going to be doing with it. Have you been to China before? I have. Where? Shanghai. Yeah, okay. And when did you go? A long time ago. This was pre-COVID. It's changed, though. I think you go to Shanghai, Shenzhen, it's a different world. And I'm not saying you should keep doing what you're doing on the security side.

9:47I think that's a smart move. But I think there's a lot of preconceived notion. This is not coming from you, but a lot of people think it's like the way, because the way we talk about China in the U.S. is very negative. But when you go there, one, they don't give a crap about, you know, all these US politics, they just want to have a good prosperous life. And they're living a prosperous life. A lot of these people are. So my buddy Ash used to work for Microsoft. And back in the day, he would create the Windows mobile phone. Do you remember they had their own operating system for the Windows mobile phone?

10:13This is a long, long time ago. He went to China to go and demo it. And straight up in the room, they said, we've already seen it. And then the person pulls up on their computer. This is something that hasn't been released yet. Okay, this is Windows phone for the first time. They're like, we already have it all. And they're demoing it to him right then and there. And then Ash doesn't know what to do. And the guy said something, and I'm going to butcher it. So don't quote me here. He's like, oh, I have ties to something in China, some party or some affiliation or whatever it may be. So Ash calls back.

10:47He ends up talking. It was either Ash or his colleague, but I believe he was there because he's telling me the story. And Microsoft was like, you can't do anything. Just come back, right? And they pretty much just jacked all the tech. This is a long, long time ago, right? And then I've seen tweets from like Mark Andreessen about China and data and security and a few others who are big into tech. And this is where I disagree with the NVIDIA founder in which he's just like, yes, we should be able to sell to China as much as we want. I believe not everything is money. We do live in America. I look at Europe as very similar to America, Canada, and many other parts of the world.

11:30And I'm not saying China is bad, but I just want to make sure that our country is safe and someone doesn't just have access to all our data and can shut us down. I think the reality is every country is spying on everyone. And I think the US, we definitely do it too. And it's for our own interest, right? And I think every country, they're protecting themselves by being aggressive. Now, that being said, you brought up politics. Let me tell you what, I had a field day over the weekend. when when venezuela who went into venezuela right and so on threads real quick um so those of you that don't know i'm running this experiment right now on threads where i'm just rage baiting everybody um and some people it's funny my friends uh called me yesterday he's like dude my girlfriend thinks you're crazy my bro my girlfriend thinks you've got off the defense it's like has eric gone crazy so i will literally post um it's like because when when venezuela was um we went into venezuela got the president, right?

12:23Their president. A lot of Americans were angry about it, but many Venezuelans were happy about it, right? So I just posted to the thread, it's like, huh, how come so many Americans are mad while Venezuelans are happy? 5 ,000 likes, right? And then I was like, you know what's comedy? It's when Venezuelans tell American to shut the F up, right? When they're telling them what to do, 13 ,000 likes. So my point of saying all this is that there's a trap that most creators fall into. It's called audience capture. And what audience capture is, and we've talked about some of these people, Neil, is when you start to get a lot of engagement in one area, you start to say things that you actually don't believe.

12:57And you start to double down and triple down on. So you and I, we know a guy who sells courses and he's gone hard left. And I don't know if he's actually hard left. I think you say he is, but I don't know if I actually - I think he is. I think he always has been. But then we have other people who are capitalists saying that so-and-so billionaire shouldn't exist. And I'm like, wait a minute, you're a capitalist. And you're saying things that you don't actually believe. So I think it's a trap that you as a creator don't want to fall into. The good thing for Neil and I is we both have businesses So we're not as incentivized to fall into that trap.

13:27You just got to be careful. So I want to clarify something here. When Eric posts on threads, he's really doing this as an experiment. Not everything he puts out on threads is actually his views. He's just pushing out little quotes and seeing what happens. And he's trying to see how that impacts his followers, his overall engagement. he even sent me a screenshot of him posting something that's political and i think it was thousands of hearts or likes or whatever okay and then he shows me right after he put something marketing related i think he got like five likes it goes to show you like you have to think of the thread the threads like it's you have a lot of people who are just fighting each other all the time so you have to one understand what platform you're on but just be careful of the game that you're playing because i'm playing this game right now to see what buttons i can push and to see how much engagement I can get.

14:19Plus it's also for my weekend entertainment as well. But you know, it's, it's an experiment that I'm probably going to stop soon. And it's not like it's going to help drive business or anything, but it's entertaining. I'll tell you that much. Yeah. It reminds me of the All In podcast, because if you look at the four on the All In podcast from Calacanis to Chamath to Saks to Freeberg, they're all startup guys, investors, or, you know, one or the other, but they're all called, let's say entrepreneurs. when you look at them i don't remember the early episodes of the all in podcast but they were not as political it was all investment the startup investments they've made cool tech like i remember david sacks was like yeah you know when you ride the bird it feels like a magical moment and and now it's almost all politics would you agree with me not 100 but it's close enough to just a political show i mean david's in the white house right and then chamat's pretty close like he goes to these Trump dinners too.

15:13And then like, I think it's very political now. Yeah, I would agree with that. So just be careful. And just, I mean, if your business is politics, sure, then you can rage bait all day. But I can confirm that rage baiting works on threads. When I go on X, for example, my feed is just everyone trying to help each other, cloud code this, everyone's sharing case studies, research and all that. Just be careful of the game that you play. So that being said, we will catch you later.