3 Niche Business Ideas: AI Psychics, Creator-Owned VPNs & Guns with Soylent co-Founder John Coogan

23:10So, you know, I can't fault him because the screwdriver is like you get to build your hacker, you get to put your PC together. Like, that's fun. VPN, it's a little boring. I use a VPN, though. I like VPNs. All right. What you got? Second idea. Yeah. So obviously, Americans love guns. You're an American. You own some guns. That's not changing. We've seen through the past few decades that real restrictions on guns are not coming. And so the business is probably pretty durable. We've seen that the stocks of munition companies are doing fine over the last decades. But the price is increasing. A lot of that's just due to supply chains, but there might be some more structural issues.

23:51Also, just more people are hunting, more people are buying guns and buying ammunition and obviously shooting. It's just a fun hobby. So over the last three years, the price of shotgun shells went from$10 to$16. Pretty big increase. And there's this massive shortage. So the idea here is basically like maybe you need a new, maybe we need to bring some efficiency to the ammunition supply chain. And I think it's an interesting idea. I don't actually know enough about how to run an ammunition depot or ammunition factory. But what I do know is that the hottest trend right now in business is like roll-ups or search funds.

24:32And every guy who graduates from HBS is like, I'm going to go roll up laundromats or I'm going to go roll up dentists. Dentists. It's like everyone has an idea for these things and they're all very commodity. They're not very contrarian. And so there's probably not a lot of alpha there. But it's like the people that are coming out of HBS are probably not saying I'm going to go roll up weapons manufacturers. And obviously, like, Anduril is crushing it in the venture side, but they're doing, like, insane software, hardware, building drones, building, like, these really advanced AI-powered weapon systems.

25:08This is not that. You do this company. You buy a bunch of, you know, all we do is make shotgun shells. You buy three of them. You move the employees around. You kind of optimize things a little bit. It's just like a very boring, like, you know, private equity style roll-up. And then maybe it accrues power over time because obviously it is a massive industry. But you're not coming in and trying to reinvent the wheel. You're not being like, we're going to actually 3D print the shell or something. No, it's just like good operations. There's a lot of gun YouTubers. You know, we could mix that. Oh, yeah, yeah.

25:39We could get them in. Do you live in California? I do. I do. Are you guys even... So I used to live in California. I live in Texas now. I own guns because I have a ranch and it's fun for shooting. Are you guys even allowed to own guns in California? Yes, we're allowed to own guns. No, like what's the rule? No, no. I mean, you can. There's a whole bunch of restrictions on like rifles, like certain capacity magazines. But I think most recently, like it's pretty easy to get a concealed carry permit in San Francisco. It's kind of a narrative violation. Wait, what? I thought for years that was impossible.

26:09Yeah. Most people think it's like unthinkable. But in fact, it is becoming easier, which is kind of crazy. But yeah, I mean, obviously, California is not like a dream state for, you know, if you're a gun fan. but sean sean you've been talking about getting your conceal and carry for years now right not at all um guns scare me but uh i did look at investing in an ammunition roll up i'm trying to find the the deck you did that's hilarious yeah we got introduced to somebody who was doing it and i was like i kind of love this idea but it was so far field uh out of like what i'm used to investing in that I was like, and I didn't know the guys.

26:50It's like, how do you know? Yeah. How do you know that they can actually do the due diligence? Like if you can't do the due diligence. Exactly. I don't think I would touch this. I wouldn't touch this either. Why? I wouldn't want this in my obituary that I, you know, even though, and I, and I, and I, I understand how that's hypocritical. You know, I criticize Sean because Sean wants to like invest in OnlyFan companies and I'm like, I'm not touching that. But at the same time I consume porn. So like, there's definitely like a little bit of, uh, I acknowledge the hypocrisy. cognitive yeah but like you know i guess i guess you know it doesn't have to be black and white it's shades of gray and like me i i prefer to stay on the whiter of the of that side yeah yeah i mean that's totally fair and i think that's why there might be alpha in this area because i think that dummies like you sam that's what that's where why this opportunity exists because that made no sense it made tons of sense dude what are you talking about you're like i love guns i enjoy them i buy them i'm buying i'm buying the ammunition but you know i don't want to support i don't want to invest in it because only bad people would buy it like what does that mean no no i didn't say only bad people i said i don't want to own it i didn't say i say that i buy the stuff i use it i think it's very enjoyable i love shooting for fun but that doesn't mean i want to make it my career i mean sam would would your opinion change if we were actively at in a hot war uh like like like it's your duty to america to optimize the ammunition supply chain because there are like there are troops from you know some country landing in the beaches of california would my opinion change yeah of course yeah and that's totally fair and i think that's right and my opinion could change about the whole thing i'm very open to new uh data points and changing my opinion uh uh i'm just saying like yeah like andrel like i love andrel i i like i think that's a very patriotic mission but 100 owning remington like right now i'm like uh i don't know man like yeah I could probably make money in other ways and my conscience would be a little less.

28:46It's just an easier decision. Sam, I got a question for you. There's a thing going viral on TikTok right now that's girlfriends asking their boyfriends or wives asking their husbands something. I'll be the wife here. I'm going to ask you a question that they're asking. Hey, when's the last time or how often do you think about the Roman Empire? Anything to do with the Roman Empire? Oh, all the time. A lot.

29:12Like, why? Under what circumstances would you need to think about that? Just like gladiators and shit. Just like battling to the death in front of everyone. When's the last time you thought about something like that? Like this week? Last night. I mean, the funny thing here is that like the meme immediately before that was like the in the arena meme. And everyone in tech was posting literal like Roman Empire gifs. because everyone in tech is like obsessed with the arena and i know that there are two separate communities like that's not why the meme popped up but it's like yeah it's so funny to see all these women are like they're like they they see somebody ask the question the guy answers some exact almost verbatim what sam just said always always it's like i'm thinking about it right now all the time yeah like what do you mean of course yeah my wife has a video of that where i didn't know about the meme and she takes out her phone videos me it's like uh how do you think about the roman empire yeah and i was like i'm thinking about it right now why how'd you know and then all the comments are like you know that make you know that's crazy and then they come back reply like i just asked he said last week he said he thinks about it twice a week like and don't like lines are being blown they're like i can't fathom why this man who doesn't take out the trash on time who forgot to pick up our daughter from preschool why he is thinking about the roman empire twice dude i think about 9 11 and world war ii like 90 of my day like do you guys not think like what would i do if i was on that plane you know what i mean like i think about that constantly i think about that constantly or like it's just a very normal masculine urge like there's this joke shane gillis he's like just so you know being obsessed with history particular world war ii is a precursor to becoming a republican like it's not gonna happen today but like you know it's early onset wait sean you don't think about like world war ii like on a regular basis no but But I have my own version of it, which is like, I'm constantly like I, if I walk into a place, I'm like assessing how, if I had to, how would I like rob this place?

31:15Or like if some shit went down, like what's the move? All right. What's the move? Okay. There's some sort of like masculine daydreaming that happens. Like my buddy David, like he, he imagines like ninjas coming through every door and window and how he would like take them out tactically. Like that's his. Dude, every time I'm in a baggage claim, I'm like, I could take any of these bags right now and just walk out. There is no security in this place. Are you kidding me? Like the baggage claim, I will never get over that. Why it's so easy to just take anyone's bag. My wife and I go out to dinner.

31:49We have like a rule. Sam's back does not sit to the front door. I have to see the front door. I can't have people coming in without me knowing. I've got to see the front door. I do think it is a man thing. You know, John, there's this funny quote Scott Galloway said. He goes, you should exercise so you can kill and eat most everyone in a room or be able to outrun them. And that's like at its root. That's kind of like what we're talking about right now. Yeah, yeah, yeah. 100%. John, I want to ask you. So Sam is basically like clearly just like surging on testosterone. You are EIR at Founders Fund, which is I remember at one point when they were talking about PayPal.

32:29They said, oh, you know, Max left to interviewed some engineer back in the early days of PayPal. And then he was like, no, no, can't hire this guy. It's like, what? He passed everyone else's test. He's like, he plays basketball. I don't know any great programmer who goes and plays basketball three times a week. That's not a thing. And so they were like very anti-jock. Do you get to hang out with the founders fund people a lot? Like, do you hang out in person at all? And what's that like? Because it seems like a room full of very interesting, very different people. Yeah, it is. It's oddly, they've done a great job of not creating a monoculture in a very small organization.

33:05So yeah, there are definitely complete jocks. I mean, obviously, we know Keith Raboy is at Barry's like five times a day. Yeah, I don't know if I would call Keith Raboy a jock. But he's like a workout nut. He's a fitness nut, for sure. Yeah, but Barry's. Yeah, he's not trying to be the best at sports. He's trying to be the best at exercising. Why is that guy? No, I'm just joking. But why is that guy? Why is Keith Reboi such a dickhead on Twitter? Like, why does he behave that way? He's like needlessly rude. I think a lot of it is just like holding the line on like, like when he sees something that's like not true, he doesn't want it to spread.

33:43And so he just like shuts it down like really aggressive. Yeah, he's like put it. He's like he's put his flag and some silly things like Miami. So it's like if Miami doesn't work, it's like going to hurt him. And it's like, you know, it doesn't have to. You know, you could love it. And also, it's not the best. A lot of these things are, you know, I think learned behaviors. I think everyone in tech is somewhat like just injured from the past like decade. For sure. It's very obvious. Of just getting like just beat down for every little thing. And so a lot of people have put up walls. And I think that it's time.

34:19I agree with you. I think it's time to kind of take down the walls, be a little bit less defensive generally. but I understand where all these behaviors are coming from. What's Sean Parker up to? We haven't heard about that guy in years. Yeah, we got to get him back on Twitter because if you, or X, because if you talk to anyone who knows him, they will just say that he was the greatest poster of all time. Who's the best on Twitter now? I mean, probably like Rahul, Ligma, Daniel Johnson, like those type of guys, right? Like, do you guys remember that publicity stuff? That stuff that they did? They fooled CNBC into reporting that they were Twitter employees that were fired.

34:59It was very like that. That's just like, you know, those guys, they're like doing a normal startup. They're like building some. Yeah, no, they're not like comedian. They should have just gone all in on like, oh, shit, we need to just create like this sort of like some version of punked or like, you know, something for the tech industry. They should have just gone all in as personalities. I would have dropped the startup like six months sabbatical on the startup. I'm just going to see what happens if I fully troll. And maybe I could be the thing that the community needs. Dude, Rahul Ligma still makes me spit water out my nose when I hear that.

35:33It's so funny. It's so funny. Yeah, I don't know. I mean, how would you monetize that? Would you just be doing stand-up? I think you would get silent donations from billionaires. I've seen that guy. And he only hangs out with successful billionaires when I've seen him in person. Because everybody who was big in tech loved that troll. elon loved it uh you know like the the holding guys like oh my god it's the best it's the best i feel like they could have a patreon of billionaires only that just fund them to like do statement art uh you know like comedic statement art against the media against the local politicians against whatever that's what i would have done if i was them that's maybe that's not a bad idea but i don't know i i like it seems like they're pretty legit at what they're doing they're like actually good programmers you have um a thing on this document that i want to fight you about yeah yeah i knew this i was getting you're good here's the so john sent us this document he says unique philosophies lifestyle businesses are worthless what do you make your case before we make you walk the plank yeah exactly no no i i this is mostly just like let's have a fun debate because i'm like you know working at a venture capital firm and i can kind of represent the VC crew and you guys are like the kings of like the lifestyle business.

36:52So we aren't the kings of that, by the way. I want to be the king of it. Actually, I actually will accept that compliment. I don't mind being the king of it. What I'm saying is I think that we are one of the very few kind of content creators. You pay proper respect to it. Yeah. What I'm saying is we do both. We think both are cool. That's there's very few people, I think, that are in the middle. And I think we are in the middle. Yeah, yeah, yeah. Yeah, yeah. That's fair. That's fair. Um, and so, yeah, basically I think the point is just that, uh, lifestyle businesses are great. Define that. So I would say, I would say like non-venture backed, non-blitz scaling, non-hyper scaling, non-monopoly, something without a crazy moat where it's just like you go and work at it and maybe it gets really big and maybe you wind up being a billionaire, but you didn't, you didn't like do this growth at all costs, insane thing.

37:42And what's hyper growth, uh, two or three times a year? I mean, sometimes 10 times a year, right? It depends on the scale. At the early stages, it goes really, really fast. But I'm specifically thinking of like Facebook, right? I'm specifically thinking of the power law outcomes in venture. And my point is that basically only about 1 % of companies that get started raise venture capital. But about 99 % of the market cap in the public markets, they took venture. And so venture has this very like disproportional outcome. And I believe that the bigger the company, the bigger the impact on the world.

38:20And so if you want to have a really, really big impact, you should actually be trying to raise money, grow very quickly. Like you're not going to build a$100 billion company compounding at 2 % a year, 5 % a year over your lifetime. It just won't happen. All right. Let me play the other side of that. Please. your analogy of well okay so you're saying one percent uh or 90 uh 99 of the value is created by the one percent of companies that raise money but that to me is also saying that like look um 100 of the soldiers on d-day who ended up uh killing like of the nazis that ended that battle they had to land on that beach anyway right so you might as well land on that beach and i'm like yeah but the other ones got like fucking killed and destroyed how about i just like not worry about killing nazis and like i can just like start this little thing on the side you know what i mean like it's like it's like dude like this whole thing with like vc it's like you're funding all the you as the investor are funding all these companies and you're like dude i don't give a fuck which one of you's dies out here because i know one of you is gonna like make me my money and so from my perspective i'm like yeah so if i can get rich at with a higher likelihood, which is maybe in most cases, the number one reason for starting a business and not most cases, like other cases, it's like the number three version.

39:39Let's say your number one version is like, I want to like create change. Getting rich is still up there. So like if like if you can get rich and create value and have fun and work for yourself and have a higher likelihood of doing that, why wouldn't you go that route? So the reason I think you shouldn't go with that route is because I think your overall impact on humanity and society and the world will be lower. if it survives. Yeah, this whole question of would you rather own 100 % of a$100 million company or 1 % of a$10 billion company? I don't even think it's a question. Obviously, the$10 billion company because the$10 billion company is having a much larger impact on the world.

40:17That's not an obvious answer. But no, no, no, it's not. It's not. For a lot of people, they say, I would rather have 100 % and be able to go on vacation and chill and just have these cash flows come directly to me and not have to deal with like, you know, all this other stuff. And I get that. But my point is that like, I believe that humans have a duty to each other to go and have the largest impact possible. And that is often done with the backing of venture capitalists. I don't think you believe that. Yeah, I do. Wouldn't you not be like curing cancer instead of selling nicotine gum? Like, let's be honest.

40:52Yes. Oh, I mean, that's hilarious that you use that as an example because that's like the actually the best way to stop lung cancer is to get people to switch. Yeah, but don't let facts get in the way of a good argument. But I will actually synthesize this for you. And I think we will agree on this point, which is that what you should actually do with your life is pick the hardest, most interesting, most value creative problem that you are equipped to solve. So can I create a cancer curing drug? No, I don't have that background. It's not an option for me. So I would fail if I went into that industry.

41:28But I should pick the most ambitious thing and the best idea that I have. And then I should be very rigorous about whether or not that idea is appropriate for venture capital. And I think that if Mark Zuckerberg didn't raise venture capital, his company would be dead. And I think there's a lot of companies, I've been a part of some of them, where we raised VC for a company that didn't need VC. And it also killed the company, I think. So basically, you have to pick the best idea that you're equipped to solve and then decide the financing strategy that aligns with that. And there's no one-size-fits-all solution.

42:23to be able to easily wire transfer, pay all our different vendors and suppliers all around the world. And the old way with our more traditional bank that shall now be named, I try it online. It would say no, it would freeze my account. Then I'd have to go in, book an appointment, speak to a specialist who would try to upsell me on something I didn't need. And then finally, after 30 minutes there, then they charged me 50 bucks for the pleasure of that terrible interaction. And now with Mercury, I just go online, push two buttons, and I'm done. It's such a seamless experience. It's very intuitive.

42:50Everything's under one place. They basically took all the things any company would need for their financial tech. And they made it super easy to use to put it into one platform. So highly, highly recommend it. If you're not using Mercury, I question your judgment. So that's it. You've heard it on My First Million. For more information, check out Mercury.com. Mercury is a financial technology company, not a bank. Check show notes for details. Do you wish you would have done a different idea instead of Soylent? Or do you wish that you just hadn't taken VC and you got wealthy? Oh, I don't know. That's interesting.

43:19I mean, right before Soylent, I was working on natural language generation in 2013, which is like the hottest trend now. And so if I'd probably just like stuck with that for a decade, I'd probably be doing something cool right now. Maybe you, I think that you would have been more impactful if Soylent hasn't hadn't raised and you had gotten rich and then you would have been able to like say something else. Well, you would have been like, I don't care about money as much. So I'll just do this other crazy thing that is a moonshot. I think it's... Because I took a similar argument as you. And then someone corrected me and they're like, Yeah, but it's a lot easier to go after moonshot ideas when you don't have to worry about a mortgage.

43:59And as someone who had a bootstrap exit, I agree. I'm like, it's pretty... I understand why founders want to take secondary because you are more dangerous when you have 10 or 20 or$30 million. You are more dangerous when you don't worry. Where you're like, I'm rich enough that I don't have to worry. but I'm not rich enough that I want to stop. Yeah, I 100 % feel like I'm in that category. Like that puts you in a dangerous category, I think. Yeah, I 100 % feel like I'm in that category. And thus, because that's true, I think lifestyle businesses are awesome. Oh, because they can get you there faster?

44:34Yeah, yeah, for sure. Yeah, get like the base hit before you do the big thing. Yeah, not unreasonable. And I think that's also kind of a synthesis of what we're saying. We kind of agree, but that it's like moonshots are good but the path might be circuitous to them right and there are freaks out there like at Elon like a Zuck well I don't know about Zuck but like an Elon who's willing to risk it all yeah even Elon like PayPal could be framed as like less ambitious than SpaceX and Tesla right it's like the mission might not be as big who knows well he tweeted this out the other day and so Andrew Wilkinson had tweeted something out like this that was like you know he learned to learn to crawl or learn to walk before you run.

45:14And he's like, most people who want to do a big, crazy, ambitious thing should start by doing a smaller thing. So they learn how to do business and then do, you know, make things happen and then graduate up. And a bunch of people were agreeing with him. I totally disagreed. I was like, if you know the thing you want to do, you should just go do the thing. You know, the way that doing something before you do your bigger thing works well, I believe is at first that was the biggest thing you knew and then as you did it your worldview expanded and your ambition expanded and your set of possibilities you were aware of expanded and then you went and did that thing however elon did reply almost uh confirming what andrew had said for him in his case he was like yeah you know i couldn't have created spacex if i didn't have the money and the skills and reputation as i had during zip two and specifically somebody had said that like they had talked to Elon and he, you know, I don't, I don't believe this for the, for the record.

46:11I don't believe a word of this, but they were like, yeah, I talked to Elon early on and, or I talked to Elon and he said that early on he decided, oh, I want to die on Mars. Just not, he said the following, I would like to die on Mars, just not on impact. And you know, that's like his joke. And then he's like, and I decided the way to do that was I needed a lot of money. And so then I went to the internet just to go get the money quickly, as quickly as I could. I don't believe that to be true because first of all not everybody is that much of a mastermind. When he was sleeping under his desk as a college kid, I don't think that he was being like, I'm only doing this so that I can amass a fortune to launch three spaceships, to be able to fund three of my own ships.

46:53I don't believe that. Also, he went and did X after Zip 2. So it's like, you already had whatever. I don't know what he netted. I think like some like 60 or$80 million out of zip two. Like, I'd be surprising to me if he was like, you know what? It's not going to be enough. I need to go get to 250 million. That's the magic number. Yeah. There's a big question about, yeah. Like, like, should you ever sell a company? Because if, if your real goal in life is to have an impact on the world, maybe the company is the best way to do that. And so you should just continue to run your company endlessly. I mean, you guys, everyone on this call sold companies.

47:29Well, my goal is very simple. Yeah. What's your goal? you said like if you want to have maximum impact on the world that is not my goal and so it's very easy for me to just be like oh cool i can rule that out i'm trying to have the best lifestyle that i could have that is my selfish and very transparent goal i am trying to improve my quality of life and with that comes my family's quality of life with that might come living in a good place and being being a happy content person walking around the world is my contribution to society i don't feel the obligation to go save the world but personally i mean the beauty of that is that like by you will naturally have a positive impact on the world by doing what you do to achieve those ends it might not be as big as oh you got us you cured cancer got us to mars but like there's going to be economic activity that provides value and utility to various people as you like go about your business and as long as you have like a moral compass that doesn't that doesn't result in you doing something really unethical like you'll probably have a net positive view on society like my trainer has a great way of saying this he goes uh you know we i was like yeah my goal is to like have an amazing lifestyle quality of life right that's my my number one like you know why i do things is around that does this improve my quality of life oh if i go do this thing i'm stressed out all the time and i have meetings all the time and i don't see my kids no no you've it is not improve my quality of life but he said the other the other thing he said is mutually beneficial so that all the things i do are mutually beneficial to the people that interact with us if i make a product it needs to be mutually beneficial to them if i have a partner or i interact with somebody it needs to be mutually beneficial and so that's the only caveat that we added to it to make it you know work is your personal trainer like your life coach too yeah oh yeah that's like a that's a recurring theme is sean's personal trainer john you uh you're cool because you um i think you're like us uh but maybe even more extreme in the tech world and that you have your foot in the startup world and you're hanging out with these big wigs but you're also can just joke around and shoot the shit and like you're pretty self-aware who uh what do you align with who do you align with politically oh uh yeah i i really like this guy, Mark Hurd, who's a Republican from Texas.

49:33He's a smaller candidate, so he's not polling super well, but he worked for the CIA and he also was on the board of Palantir. And he would be the first computer scientist president. And I think that that would just be very, very interesting to see someone with a CS background. Obviously, I love programmers and I I think that they think about the world in very interesting ways. And we've had this very long, long arc of, you know, lawyer, lawyer, businessman, lawyer, lawyer, lawyer. Like that's the story. And he's like a younger guy. So I'm proud to endorse him. Are you more Republican than Democrat or do you vote both?

50:13Yeah, yeah, I vote both. It just kind of depends on who is who can have like the highest impact on mostly technology and the business community. I think that those are kind of the things that we need to be thinking about. I do think there's the interesting, as I look back on Trump, I didn't vote for him, didn't support him, voted against him twice. But I think that there's this weird situation where like the problems that Trump brought were obviously really bad. I think he really like divided the country and just created a lot of chaos. And I think that was like probably net negative for the United States.

50:48but he did kind of get China right. And he started this, like, he got people waking up about the fact that we are in a great power competition again. And so you could see a world where the China situation dissipates and things get better. And that would be phenomenal for the world. And that's what I hope happens. And in that case, Trump will be remembered as like an idiot, basically. But the opposite could also happen where the China situation gets hotter and then people look back to Trump as like a genius who foresaw this all and like took the first steps to like make things safe. And so I think what's interesting is that the way we remember presidents is often not by what they actually did, but by how their decisions look in hindsight.

51:33And it comes back to the, you know, don't judge a venture investment until it's 20 years later, 10 years later. It's the same thing. It's like maybe we shouldn't judge our presidents until we, you know, with the full history of time. You had said something earlier about like you were working on natural language generation in 2013. Yeah. Now these large language model, LLMs are all the rage. And you had an idea around this that I liked because it was very different than how most people, most investors talk about this. So you had said something like everybody is knocking certain AI startups because they're, oh, it's just a wrapper on top of GPT.

52:11It's just a wrapper on top of what OpenAI is doing. And it's a flimsy little thing. You had a different take. What's your take? Yeah, my take is that that might be a reasonable critique for a growth stage venture capitalist to debate with their partners at an investment committee meeting. That is not necessarily what we should be putting out on Twitter X to the next generation of young builders. And if you are, you know, I know a lot of these kids who are 17, 18, 19, and they're hacking and building chat GPT wrappers, and some of them are making a ton of money. And it's fine. What's an example?

52:50yeah i mean like an example would be like um like just just narrowing down to something very there are a few people that have done like uh like almost like dating coaching kind of like uh to help with if you're bad at texting there was a whole south park episode about this where it's pretty funny yeah yeah like if you're if you don't know what to text someone on like a dating app you can have like you can go to chat gpt and say hi i'm on tinder and i i need to send a response to this girl and I'm feeling awkward. Like, what should I say? And it'll give you a recommendation. But these apps have kind of like fine tuned it to be a little bit more like spicy or, you know, engaging or whatever.

53:29Homework help. They'll do rap lyrics. They'll do whatever, right? Yeah. And I don't know the details about those, but a lot of people will be like, oh, those aren't appropriate for venture capital. Therefore, like they should not be built. And this is kind of where I'm flip-flopping to my, you know, lifestyles are bad. It's like, no, actually these are phenomenal because we need these people to get experience building. And I think maybe I think about it even less from the economic side and more from just the experiential side of like, if you ever talk to somebody who's like, they were able to run some small business when they were in high school, that's always a bull signal for entrepreneurship.

54:08Like it's always like, oh, and now you're doing the venture back thing. It's gonna make a lot of money. It doesn't matter what the thing was, right? It's like, oh, I was hustling sneakers or, oh, I was like selling, reselling concert tickets. Like my thing was I bought DJ equipment in the United States and then I would export it to Australia. And I was just like hustling that stuff in high school. Like everyone has one of these stories. I'm sure you guys have tons that you've told on the pod. But so basically with the, I want the Lenza for chat GPT moment. So Lenza, for those of you who might not remember was - I don't know what that is.

54:42So it's this app that you would download and you'd upload, you know, 10 selfies of yourself from your camera roll. Yeah. And then it would generate AI images that looked like you. So it would be like, that looks like Sam's face, but it's on Superman. But it was really like a Russian company. That was the rumors that it was a Russian company. I don't think that one was. But yeah, I mean, there are some weird, like these apps come from all over. I'm not sure about Lenza. I think, I just haven't looked into the company. And it made a bunch of money. It was like number one in the app store for a bit.

55:15Yeah. Yeah. It was based on, it was based on stable diffusion, which is this open source software package and dream booth, which was this paper that Google put out that then people went and implemented. Like no one knew what those things meant. No one, your aunt doesn't know what stable diffusion or lens or dream booth is, but she probably downloaded and paid for lens magic avatars and had that as a profile picture for a little bit. So it was just like this, this fun viral moment that was really successful. And I think that there's a lot of people who I would hate if they're toying around with ChatGPT and they don't build something that's really fun and cool because they're like, oh, well, this won't be like a hyperscaler combining like generational company.

55:55It's like maybe you just need to go build the fun thing and put it out there and see how it goes. What would be something you build? So I have an idea about this, which is basically that there's a few things that these systems are really good at. You know, obviously, there's been huge progress in helping software developers program with GitHub Copilot, which is, you know, built by OpenAI under the hood. There's also, you know, just the Google use case. Like, I go to ChatGPT all the time and just ask you questions that I would normally ask Google. People are doing a lot of, like, AI girlfriend stuff.

56:27Like, you know, Sean, I'm sure your next big OnlyFans investment will have an AI component probably. But I think that one of the interesting things that these language models are particularly good at is something called the Barnum effect. Have you guys heard about this? No. So the Barnum effect is this psychological phenomenon where, like, I can say, like, something that sounds like it's very specifically tailored to you, but it's actually vague and applies to everyone. So an example of this would be, Sam, you have a great need for other people to like and admire you. You have a tendency to be critical of yourself.

57:08You have a great deal of unused capacity, which you have not turned into your advantage. Like these things resonate with everyone. They certainly resonate with me. I feel like, yep, yep, yep. But, and they feel personalized. It's like astrology. Yeah, yeah. They use this in astrology. And so what I'm thinking is like someone should take the, you know, chat GPT LLMs and make some sort of like viral personality quiz, viral astrology app, something along those lines that. Miss Clio. Yeah, that exploits this effect that LLMs are really, really good at. And then uses it. It's just like, yeah, you, oh, yeah, did you get your personality test?

57:45It's like, did you get your Lensa magic avatars? Like, yeah, I got them. Like, I had to do the in-app payment. It was$5.99. It's like, oh, did you, well, did you get your custom personality test through this chat bot that's new and going viral? Like, yeah, sure. I did that. I think that's a great prediction. I think that's going to happen very soon. And this, we'll look back at this clip and be like, dude, he called it. John called it that that was going to happen. I love it. It has to happen. Somebody said this the other day. They go, they showed me, oh no, they showed me a Steve Jobs clip. and Steve Jobs goes, once this technology happened, there was a set of 20 things that were going to happen no matter what.

58:21It didn't matter who was going to do them. They were going to happen. A series of events were going to unfold once that first breakthrough happened. And you just didn't know when and you didn't know who, but you definitely knew that they were going to happen. That's how I feel about this idea. I love it. I'm glad I got the thumbs up on all my suggestions. Yeah, your ideas were actually very, very solid. You said you did your high school flipping thing. You also were a, what was it called? Like a phone telemarketing scam artist. Tell that story. We'll wrap on that. This is a phenomenal story. What are you like, workaholics?

58:57Yeah, yeah, a little bit. I use the office as a reference point because that is the default small business in America. They make a thing and then they ship it out. And so the scam worked like this. I found the job on Craigslist. I show up and I'm wearing a suit. I'm probably 17 years old or something. And I'm like, I brought a resume. I want this job. And they're like, it's not that type of job. Like you do not need to be wearing a suit. Just sit over there. You're going to call these numbers, call down the list. And when they pick up, read this script. And the script goes like something like this.

59:32I probably still remember it by heart. But it was like when they pick up, you do not ask how they're doing. You do not talk to them. You just say, shipping department, please. And you want to make it sound like you've been disconnected. Like I was already talking to the shipping department. Half the time, people are like, what are you talking about? This is a law firm. We don't have a shipping department. But the other half of the time, people are like, yeah, we got a shipping department. I'll transfer you down there. Like you must have just gotten disconnected. Then you're down in the shipping department.

1:00:02So imagine Dunder Mifflin from the office. You know, you just talked to Pam. Pam transferred you down to, I think Daryl is down in the shipping department, right? And now you're talking to the guys down in the shipping department. And the scam was selling two-inch clear tape. So the guy picks up from the shipping department, says, shipping department, John here, or Daryl. And then you say, hey, you guys are still using the two-inch clear tape, right? That was the line. So this is the secret. It's like asking an office if they use eight and a half by 11-inch paper. Or like asking a podcaster, do you still use microphones?

1:00:36You know, it's like, yes, everyone uses two inch clear tape in a shipping department because what you use to just tape boxes, it's clear tape that you use to pack things, packing tape. And so they're obviously going to say yes, but it sounds like you've already sold to them. You know, you're still using the two inch clear tape, right? We didn't say that we sold you, but then, then if they say yes, then you say, you know, hey, I just want to, you know, like, thank you. Not for being a customer. Just thank you. I want to thank you. and we're going to send out, I want to send out another box of that two inch clear tape for you guys.

1:01:11And I'm going to throw in a Starbucks gift card for you personally. Your name's going to be on it. This one's for you. And I, and they're running me through this and I'm like, how much is the Starbucks gift card for? I'm like a, I need information. I'm like obsessive about information. And so he's like, don't worry about it. And I'm like, no, but like I need to know because like what if they ask me? They'll never ask you. And I was like, no, but I have to know. Like I just, I cannot do this job unless you tell me. And he was finally like, it's$5. It's like, wow. So, so they, so they, you know, they do the Starbucks gift card thing.

1:01:43They get the guy to say, you know, yes, I'd like, you know, I'm still using it, send it out. And then they send it out with an invoice. So you don't need to collect the credit card details over the phone. They send it out with the invoice and they've priced this clear tape at exactly the level that they think most accounting point accounting departments will just stamp it. So it was$500 for a box of clear tape. And it cost them$5 to produce this tape. How much money did the company make? Millions. I mean, the guys were like driving around in sports cars, like, and I ran the numbers and it was like, you know, while I was there, I only worked there for one day.

1:02:18And then like, I quit because I was like, this is a scam. I figured it out like almost immediately. But a lot of people stuck around like, you know, but even then I think I, I think I sold a thousand dollars of clear tape and they're just trying to get that one sale. And the conversion rate is insane. Yeah. So they send out, I talked to the guys in our shipping department of the scam and I, first off, hilarious. The guys don't use their own clear tape because it just falls apart. It just disintegrates. It's like the worst product. They buy the stuff that gets thrown away in China, basically. Like if they have manufacturing defects, that's what they buy for like 10 cents.

1:02:52And then they sell that for$500, which is already an order of magnitude more than you could just get from Staples. Are they still doing this scam? I don't know. I don't think so. They had like an F from the Better Business Bureau. And then like, I imagine that it like dissolved. They probably got like all their phone numbers blocked or something. What did these guys look like? Did they look like what I think they would look like? I imagine. They actually looked exactly like the three of us. Which is what I thought. Yeah, exactly. I think the CEO had your jacket, Sam. he was wearing a black picture like you didn't he drive a black Escalade yeah probably no I think I think they were doing like Audi R8s I think that was like the big move there's some guy listening to this that's in a shipping department that just had a holy fuck moment he's like we've been that goddamn that tape guy who keeps calling me those gift cards and then there's like and then there's like a thousand other people who are like so how do I get the leads to the shipping company yeah I mean the tape business style boys the gang sells tape this is like one of the funniest things i i ran into a guy who'd worked there a year later and he was he came up to me i was at a concert and and he was like oh john like i remember you the tall guy like how's it going i was like remind me where we know each other from and he's like delta shipping i was like oh yeah i worked there for like a day like what's up like are you still there he's like no they fired me they fire everyone like every three months because they need to turn people over because as soon as one person finds out it's a scam they will tell everyone else it's the same thing with like a pyramid scheme or a ponzi scheme like you got to like extra you gotta like you know get out anyone who knows the truth and keep the blinders on everyone who's there because as soon as as soon as one person figures it out they're going to tell other people and be like don't you think it's kind of unethical what we're doing or don't you think this is like what if the police come like would we be in trouble you know and then that scares everyone and then the whole thing the whole well is poisoned so i'm like oh you got fired like that's i'm sorry man that's tough like what are you doing now hopefully you got like a better job he's like yeah i'm selling drugs at this concert i was like what

1:05:02and he's just like i've never heard anyone like so proudly tell me that they're like a drug dealer but i was like okay like step up i'm not into that but i have some friends that are like let me make a deal that's amazing you uh tell people what your youtube channel is and also tell us why are you doing youtube you could be going out there building another business but you're like us you're creating content. So tell people what the channel is and why you do it. Yeah. I mean, it basically just bored during the pandemic had always been, I mean, our first viral success at Soylent was, you know, content and content is super important for launching companies and I'm an entrepreneur.

1:05:33So having a voice is very important in that equation. My YouTube channel, you can find it just John Coogan search there. I also have a podcast now, powerlaw.fm, powerlaw hosted by John Coogan. Not an interview show. It's just kind of deep dives on these power law people and companies. That's a good name. That's a good title. That's a good idea. Yeah. So it's, it's interesting. It's, uh, yeah, it's a lot of fun. I just, I really like it and, um, yeah, check it out. And I, I, the biggest problem with it is that I don't have a lot of focus. I'll talk about geopolitics. My last video was on Doug Jumuro, like breaking down his business.

1:06:10Like I just, I'm all over the place, but, uh, but it's so much fun. And like, there's clearly value in what we do. People enjoy it, makes them happy, and you meet interesting people. We got to have a great conversation because of it. We appreciate you coming on. This has been really fun. You're cool, man. This has been awesome. We appreciate it. And we don't have a lot of focus either. Look, we went from scams to who are you going to vote for to guns. It's the dream, man. This is like your audience, you won't be perfectly optimized. Like, oh, we're the best ever. But in terms of the lifestyle, we all agree.

1:06:43Like this is the way to run the content machine. Don't go too crazy with it. Well, thank you. We appreciate it. And thanks for coming on. And that's the pod.

1:07:06Hey,

1:07:11let's take a quick break because there's a quote that I love. I want to read you. It's that we shape our tools and thereafter they shape us. And, you know, as an entrepreneur, if you're using a bank that was built in the 90s, you're operating like you're in the 90s. And trust me, I've been there. Clunky portals, random holds on your money,$50 wire fees, and then being told, please visit your local branch. Well, that's why I switched to a different type of banking solution, Mercury. It turns your financial chores into a smooth workflow. You can do wires, invoices, cards, reimbursements, two clicks, and I'm done.

1:07:40If you're already using Mercury, respect. If you're still using one of the old big banks, I got questions for you. So go visit mercury.com and give it a test drive. Mercury is a financial technology company, not a bank. Banking services are provided through Choice Financial Group, and Evolve Bank and Trust members FDIC.