3 weird businesses doing $10M, $20M, $30M

19:08Sam Parr:Oh. And that's been like a little bit of a claim, of fame that he's had. Give us a little sauce real quick. What are you doing? We used Lindy to run the sales process. They don't have salespeople? We do have salespeople. But they've shifted. They've really shifted to a different focus, basically, which is where I'd like them to be more of that customer experience and getting people to come back. But Lindy is able to respond to every email that's coming in, follow up with it, upsell them, just go through the whole process. but yeah it was it's it was a big lindy which is what flow was talking about is crazy that's awesome all right appreciate you doing what you've done is awesome dude all right thanks guys hey let's take a quick break you know that feeling when strategy is done the brief is written everyone's aligned and you realize someone still has to sit down and actually create all the content that someone is usually you and it's due tomorrow well the breeze assistant from hubspot can help it works right inside hubspot you can draft a campaign copy blog posts, emails, all in your brand voice, all using your actual customer data.

20:07So you don't create just content. You create content that converts. Check out HubSpot.com, the agentic customer platform for growing businesses. We need like a name for this. Dragon's Den, the Shark Tank, the swimming pool, the denim dungeon. Let's go. The denim dungeon. What's up?

20:29Sam Parr:What up, brother? How's it going? Have a seat. All right. Your name and the impressive number. Hit us with the big number. Great. I'm Josh. I run Team Outsider. We acquire family-owned campgrounds, and this year we'll generate around$20 million of revenue. $20 million in revenue. Okay, so explain like I'm an idiot because I kind of am. What do you do exactly? Yeah, so we acquire campgrounds typically from families who are looking to retire. and a campground, the majority of it is like a hotel, right? So we're renting different spaces. Some people come in their RVs, so they have effectively a traveling hotel room.

21:06We also have tent spaces and cabins that we rent to people who don't want to stay in a tent and don't have an RV.

21:11Sam Parr:Do you camp? When's the last time you went camping? Like 10 years ago, but I appreciate it. I haven't gone camping in like 20 years. So a campground is literally just a piece of dirt, right? So the ground... We have amenities. So all of our campgrounds have stores. We typically have a cafe where we'll sell ice cream and sometimes burgers and pizza. Is it like cabins, basically? We have cabins as well. We have swimming pools, lakes. At one of our campgrounds, we have a go-kart track. Oh, okay. So it's a very outdoorsy hotel, essentially. Effectively, yeah. Okay, we're looking at one here. What's the most popular one you guys have?

21:44They're all really popular in their local communities. The first one we bought, which is right near Grand Teton and Yellowstone, is really popular because that's a major tourist destination. We have one right outside New York City called the Never Sink River Resort. It's a couple hours away, so that's really popular with folks who live around here. So give us a story. What makes a guy want to buy a campground? How did you even realize that that's a good opportunity? Yeah, so I met my partner in college, Cody. We studied together and started a business together, which was tremendously unsuccessful, but showed us that it was a really good relationship.

22:16So we stayed friends post-college, got some working experience, and then realized we wanted to do something together again. We were looking for a business where two non-technical founders could hopefully have a winning situation. And we wanted a market that was large enough to participate in and interesting. One where there was an immense amount of fragmentation with ownership. One that was operationally complex. And one that was meaningful, where the team members would feel good working there and where the customers would feel good about being part of it as well. How many do you own? Currently, we have 16.

22:48And there are about 4 ,000 sites amongst those in 10 states. And did you raise money? Yeah. So the first one we did with our own cash and an SBA loan. So it's kind of... That was the Yellowstone one? How much was that? About 3 million. And so how much money of yours and loan did you put? The loan was 80 plus percent. Yeah. The rest was cash. Sorry. So that was an already operating site. Everything we buy is existing cash flow. It's been there generally for decades. Most of these are staples within their local communities. So let's walk through that first one. So you find this property. It's doing what when you buy it?

23:20It was generating around half a million dollars of top line, of total income. Top line. And then the cash flow on that is what? About 35%. Can you do that for me? Yeah. Call it 150. Okay. And you buy that for 3 million bucks. Okay. So that's the entry. And then you do that knowing, hey, we think we can turn that 150 to 250. What was the insight at the time? Yeah. So that one didn't have a lot of digital marketing. It was - Was it like a mom and pop thing? All of them are. And everything's on paper

23:51Sam Parr:and they've been doing it forever and they're like, our kids don't want this shit. Do you want it? Exactly. So we are oftentimes a succession plan for these sellers. And so these are multi-year relationships. We've got a couple under contract right now. One of them I've been talking to the seller for five years. And generally what happens is we maintain the relationship and when they're ready to sell, we get the call, hopefully. And what are you going to do to make it better? And what does better mean? Yeah, so there are a few things we can do. One of them is introduce just professionalized systems.

24:17So digital marketing, a better website, VoIP systems for the phone to be able to make sure that the training is happening the right way. Does marketing mean like Yelp and Google reviews? Google reviews, but also paid ads, a better website. Oftentimes, there's no digital reservation systems. We'll introduce that. Got it. So that's kind of on the technology side. I think I missed it. So you're like, I wanted to do something with my friend. And then you had the like, business school explanations like high fragmentation. No, no, no. Like, where were you sitting when someone was like, should we buy campgrounds?

24:46Or like, you met a guy who's rich that bought campgrounds? You're like, we should do that shit? Like, what actually happened? Great question. So our backgrounds were in hospitality and real estate. Okay. So there's obvious confluence there. And then Cody lives in Bozeman, Montana and is an avid RVer. So he said, hey, like the thesis sounds interesting. Why don't you fly out here and let's drive around the country, meet some owners, team members, guests, and see if this is something that actually has a little bit of a spark to it. So I flew out from New York, spent some time on the road, meeting different campground owners and team members and guests and just fell in love with the space.

25:17And how much money have you raised in total now? We have raised around$60 million. You've raised$60 million from... From fire. What'd you say, 15-ish properties? We've sold a couple, but we have 16 currently. And what is it all worth? North of$100 million. Does that mean that$40 million is you and your partner's equity? No, we've raised outside capital. So at this point, we have family offices we work with. We have a select group of accredited investors we work with. and we have a few institutional partners that we've worked with as well.

25:47Sam Parr:I guess what I'm saying is of the 20 million in revenue or if you value it, I don't know anything about real estate, however you value it, how do you get personal cashflow or net worth from it? Like most real estate operators, it's promote-based and different deals are different depending on the investment partner, right? So we are back-end incentivized largely for most of these. Typical private equity structure where there's a preferred return, there's a return of capital and then there's a split depending on kind of who the investor profile is. So when you do that first one, you go buy it for$3 million.

26:17It's doing half a million in revenue,$150K of cash flow. What happened? What was the success story of that one? Obviously, it was a success. You wouldn't have 16 more. We were able to refi a couple of years later. So took all of our cash out. You brought the NOI up to what? The NOI in that one went from closer to$300 at that point. Okay, so you doubled the profit on the thing, refinanced it out, used that capital to go buy the next one. Exactly. Exactly. That's pretty awesome. Why are campgrounds, if I wanted to go do real estate, why would I choose campgrounds instead of whatever, retail shopping, multifamily, office, whatever?

26:54What would be my advantages if I was going into this? Strong yield. It's operationally complex, which means there's opportunity to drive value and really attractive depreciation characteristics that are similar to manufactured housing, for example. So you can depreciate the roads and the infrastructure. There's very limited land value in a lot of these more rural markets, limited building value. So the depreciation characteristics are also really attractive to people who are tax sensitive.

27:19Sam Parr:Will you do this for forever? I hope so. Yeah. I love it. Like looking down 10 years or 20 years down the line, where do you hope to be business-wise? Yes. Look, I think the larger opportunity as more of life moves online, I believe businesses that get people together in the real world are going to be more valuable. And there are different types of experience-oriented real estate that can speak to that thesis. But campgrounds still have a lot of runway. We still have a big pipeline of properties we'd like to be a part of. And so hopefully we're doing this for forever. Who are the big dogs in this space?

27:53Yeah, so there are two very large REITs in this space that initially were into the manufactured housing side of the business, but recognized both from a depreciation perspective and also the infrastructure is very similar, right? There's a campground REIT? There are manufactured housing REITs that have a large portion of campground exposure.

28:10Sam Parr:Oh, that's interesting. Yeah, so that was one of the ways and we were researching this that we got a little more comfortable with the idea. When you're buying these, you're buying out the operator and then you put a property manager, property management companies. We're the manager. You are the manager. Yeah. So initially we didn't think we were going to go that route. Initially, so Cody, my partner, went and managed our first location for the first year. Scrubbed toilets, did the whole thing. And we thought, learn how to hold a shovel and dig a hole. And then you can hire a third party to manage it like most real estate sponsors do.

28:37And what we realized is, A, you can't outsource culture. So that was going to be really important for our success. And B, if we wanted to scale, there weren't really, at least at that time, competent third parties that could scale with us. So we made the decision to build an opco in-house and have been managing our properties ever since.

28:53Sam Parr:Your branding's cool. Thank you. It's awesome. I appreciate that. And when I was looking, I was like, I would like to go see this. Is there a world where you would buy many of them in a similar region and create a membership? You know, like KOA. Is it KOA? Yeah. We're actually a KOA franchisee in certain markets. So how do I explain KOA to someone? I mean, I don't know. McDonald's of Campgrounds. Okay. They've got 550 flags across the country. They own about 50 of them themselves, but they are a franchise. No, no. But is it like he's saying where it's a membership or it's just a brand you can trust.

29:22You know what you're going to get. It's a brand you can trust that you know what you can get.

29:24Sam Parr:Yeah, it's like when I do road trips and I want to camp, it's like something might be a lot nicer. Something could be a lot worse. But KOA, I know what I'm rolling up on. I was talking to a famous guy and he was like, an hour outside of cities or something called, what is it? Postcard cabins or something like that. He's like, oh, I love going to those. my kids. It's like, what's the story there? Then I looked it up. It's like owned by Marriott or something. They sold to Marriott last year. It's a little bit of a different model. They were focused on very remote single units in destinations where you didn't have to see your neighbors.

29:55We are more community focused. So a lot of our campgrounds have seasonal guests, which basically means these are people who reserve the right to a specific space for the duration of the season, pay before the season starts and come every year. Grandma's there. Aunts and uncles are there. Kids are there. Everyone's been raised there. All the friends are around. So it's very sticky and communal.

30:14Sam Parr:But is there a world where you do brand it so it's similar to each property has maybe a different shtick, but it's all under one brand? Potentially down the road. I think real estate brands are inherently tough to scale. And until we have meaningfully more scale, that's probably not the right focus for us. But as regional concentration starts to happen, which is already naturally happening, perhaps that's something to explore. So when I hear you, I know nothing about real estate. When I hear you describe this, I think, that sounds awesome. You're outdoors all the time. Obviously, that's not the case.

30:44Sam Parr:What's the day-to-day work? Are you just like cold calling these places, trying to make a deal? Writing a lot of handwritten letters, a lot of cold calling, a lot of checking up on... Have you found like a letter with a cookie converts better than like, you know, a call? A lot of it is luck. The challenge in this space is effectively our sellers are behind the front desk most of the time, which means in season, they're exhausted and they don't want to take a call. So the bottleneck of the business is just getting in touch and wooing... Finding people who want to sell. building relationships and being the trusted succession plan.

31:14Because they care. They don't care. It's not just a money thing for them. Exactly. These are their friends that they have been personally servicing for oftentimes decades. And so whoever's taking over that relationship is a really important person to them.

31:24Sam Parr:Is there like a campground owner's publication or summit or podcast? Yeah, there are Facebook groups and conventions and all the things. Are you just like posting them all the time with like the same thumbnail image of across all of them? So everyone like starts saying like, oh, this is the guy. He seems like a good guy. A bit of that. We're trying to figure out how to do it in an authentic way. And that's a tough balance because there's a level of mistrust around being over-marketed too in this space. So a lot of it is catching them on the right day when the campground's a little bit less busy and they answer the phone and we can start a relationship.

31:55And then, you know, years later, when they're ready to sell, we get the call. That sounds pretty awesome. Is this, how many hours a week do you work? A lot, yeah.

32:02Sam Parr:You grind? Yeah. You're in grind mode? Yeah, absolutely. But I love it. There's a lot of real estate people, they choose real estate because while real estate is work, there's a way to do it or a state you can reach that is not about grinding and it's about like you have a lot of flexibility and you got cash flow coming in or you flip a property and you can take time off. You know, you could do all kinds of things. Sounds like you're approaching it more like company building than it is. Company building and it's a hospitality business. Yeah. Right. We've got tens of thousands of guests every year, 350 people on the team.

32:34So there's no easy break period.

32:37Sam Parr:Are the people you employ to run a campsite, are they pains in the asses? Like, are they hippies or are they meth addicts? No, we have some amazing people that work with us. We'll flip this and send it to them. Please. The majority of our team is incredible. They're aligned with our mission, which is to be the most hospitable team in the world, which when you're trying to replace a mom and pop operator is really important because the hospitality that a family provides is really tough to beat. But we do have some fun stories of team members that haven't been the right fit. We had a situation where we found out we had employed a convicted bank robber.

33:10We'd robbed nine banks. I had to go personally fire him in person. What was that like? Terrifying. Yeah, he actually was incredibly nice and reasonable. But the drive-in, I was very scared. Had another situation where we found out through a guest that some people on the team had been cutting down our trees and selling the wood for cash on a Facebook page. So it wasn't a great situation. And again, these are total outlier situations. They're just fun for conversation. Hey, why do you live in New York? Why do you do this in New York? My family's here. My wife's here. My son's here. My parents are here.

33:41My in-laws are here. So, you know, when you have kids and the grandparents around it. But my partner's in Bozeman and look. So let's hit it real quick. What's the burning question? If you had a burning question, something that we can give you kind of a quick, maybe a different insight on than as an outsider, what would be helpful? Sure. As you think about what we do in trying to scale culture to a team of hourly employees across 10 states with this workforce, what is something that we could do differently to keep people incentivized to deliver the level of service that we're trying to deliver?

34:12If you can solve this in 10 minutes, I will love you forever. Well, actually, I'll give you a quick story. So my first business was a restaurant business, which has the same problem. Frontline workers in hundreds of locations if you do it right. And we met with the founder of Chipotle and he said, if you can get a frontline worker to care about the customer, like treat this the way you're treating this first location, you'll make billions of dollars. The problem is that's the hardest thing in the world to do. And Chipotle actually did some pretty interesting things where like both in the naming of it, like they have general managers, the general managers get comp.

34:41If any employee you ever have becomes a general manager, even if you don't longer work at Chipotle, you get 10 grand in the mail. Like they do lots of things to like build a culture where they get people to stay longer than they normally would to work their way up the ranks, to actually think like an owner of that place. And so I would just study, I'd make a list of the 15 companies that have already solved this problem. I would study what works. I'd look for common patterns and I would try to hire people who were there in the early days, either as consultants or as a full-time person. Often you can find retired people who you're not going to hire them, but they kind of want something to do and they're sitting on this wealth of knowledge because they helped scale, you know, whatever, some cruise line.

35:20Sure. And, you know, and now they're just retired. And I think that's what I would do if I was going to solve this problem. My real life answer is I run away from businesses that have that problem because I just, I'd rather pick a different card. But you've picked this hard. Yeah. Good luck.

35:34Sam Parr:Obviously you've read Will Gadara's Unreasonable Hospitality. We had him on the podcast and he told two stories that was interesting because I was like, okay, this works good in a fancy restaurant. Where else does this work? And he told two stories. The first one was he was like, I worked with a dealer, a Ford dealer, like a car dealer. and I worked with them. I go, look, let's just find like a forgotten moment where we could blow someone away. And Will goes, let's go sit in the car. Let's look around. He goes, what's in the glove box? And the dealer was like, nothing. We don't keep anything in there.

36:04Sam Parr:He goes, I got it. Let's put a$15 Starbucks gift card in the glove box of every card. And we're going to put a note that says, whenever you're going to open this glove box, we wanted to surprise you with something special. And that's all it said. The second example where he got his team to do it, He told the story of a UPS store owner. Not exactly a high margin or wonderful business necessarily, but he was like, every week the owner had a competition to whatever person did that was considered the most hospitable thing. They just got a$20 bill. That was it. And he was like, just doing that one contest, it changed the whole culture because now everyone was competing on who can be the most hospitable.

36:41Sam Parr:And just like one little trick. And like grownups are just like kids. We just like stickers. Totally. And so, and he told these two stories and I was like, oh, those are so small. And he was like, they tracked referral business and it definitely worked. Okay. And so you should listen to that podcast. It's My First Million, Will Gadara. It was really cool. Amazing. Look forward to it. But yeah, that guy's awesome and he gave you some actionable tips. Yeah, fantastic. Thank you. Right on. Well, congrats on everything, man. Thanks for coming on. Appreciate it, guys. All right. God bless, dude. All right.

37:08Sam Parr:See you. Should go camping. Yeah, it's pretty awesome.

37:14Sam Parr:A billionaire venture capitalist who's one of the greatest investors of all time. His name is Bill Gurley. He recently wrote about the single most important principle when it comes to building a company. It wasn't fundraising. It wasn't product market fit. It wasn't even hiring. Bill said that an engaged peer network might be the most powerful growth tool available, but it's also one of the most under-discussed and underutilized. Now, keep in mind, Bill is a seed investor to Uber, Zillow, OpenTable. And so he's had a front row seat into how some of the best companies actually operate. And after decades of watching what separates the winners from the rest, he lands on this.

37:47Sam Parr:Who you're in the room with is the most important thing to whether you're going to be successful and build a great company or not. Now, most of you founders who are listening to this, you treat a peer network as something that's nice to have, something that you're going to eventually get to do, but you actually never get around to making it happen. My company, Hampton, we have changed that. We build curated groups of highly vetted founders in cities across the United States, Canada, and England. This isn't a surface-level networking event. It's not a mastermind full of strangers. It's a peer group of eight other entrepreneurs who will challenge you, hold you accountable, push you to grow, and you'll meet with every single month in your city.

38:21Sam Parr:Apply at joinhampton.com slash MFM and I will reply in the next 24 hours to help figure out if there's a good group in your city that's the right fit. All right. The last one is going to be funny. All right. How's it going? What's up? All right. Welcome to the hot seat. The Denim Den. The Denim Den. Let's go. Is it live right now? The Dudes and Denim were live. All right. You want to give us the big? All right. The big number. I'm Brian. I run a company called Autopilot. We manage$1.8 billion. And that makes$30 million per year of revenue for the company. We started about three years ago for the company Autopilot.

39:00And one number that kind of blows my mind, I think it's a testament to how much people want to invest in retail traders. it took Bill Ackman and Ray Dalio about 10 to 15 years to start managing a billion dollars. And the fact that like Autopilot, this tech company that plugs into your Robinhood account, your Schwab account could manage 1.8 billion, to me just blows my mind. I'm shocked.

39:22Sam Parr:That's crazy. I didn't realize how big you guys were. So what's the business do? Yeah. So the business, we're most popular for launching the Nancy Pelosi stock tracker on Twitter. I thought your big number was going to be like 44%. That's Nancy Pelosi's annual returns. What are her annual returns? What does Nancy Pelosi do? In the last three years, she's up around 240%. Check the app for the actual performance. I have to say that for SEC compliance. But she's outperformed the SPY significantly. So I think the SPY in that same time is up around 30 % to 40%. And she's up 240%. In your app, I can invest alongside her picks because she's a politician.

40:01Sam Parr:Exactly. She's not a politician anymore. So her, well, she retires in January of 2027. So we have that much time to copy her trades and follow her trades. But basically... I can follow anyone. You could follow anyone. So you could follow her. You could follow different politicians. We also take 13 apps from different hedge funds. And that was the way that we kickstarted the marketplace. I think every startup has like that chicken egg problem they have to solve. For a marketplace, you have the supply side and the demand side. And if you don't have anyone to follow that's good, you're not going to get people to come follow that person.

40:31but if you don't have anyone to follow, no one's going to want to launch on your platform. They're like, why am I doing this? So we were like, Chris and I, we got together and we're like, let's just manufacture the supply side. Let's take publicly available information.

40:43Sam Parr:Because the whole premise of Autopilot was anyone can become a hedge fund. So instead of like having a sub-stack newsletter where you could follow my content, I can charge a certain amount and you could follow my trades or my portfolio that I think is good. Exactly. Got it. And I think there's a lot of sub-stacks. I'm sure we've all like read some of them, but you don't know like the performance of this person. Maybe the right one. And they'll always post their winners. They write a very convincing case. And then they talk about how last time they were right, but you only know their chair picking a winner.

41:13Yeah, they might've been wrong like three or four other times for that one. And so with autopilot, you have a track record of success. You can see people's winners, their losers, their performance, their entire performance. And then you can see how many dollars are following them, their content, et cetera. How much money have you raised? We've raised about 16 million.

41:28Sam Parr:One six. Yeah, one six, 16. And$30 million in revenue seems like a good company. Yeah. What's that worth? I don't know. We're going out to raise a Series B. The valuations at different venture firms have floated rounds between$300 million, $400 million, which is crazy. But that is venture money. I'm not sure what it's actually worth. How old are you? 31. You start this business. What's the first idea you had here? First idea is what? So the first idea we actually started six years ago was an idea, it was a company called Iris. Iris for the eyes, so you could see into other people's portfolios.

42:03I was trading on Robinhood. You've been thinking about this idea for like six plus years. Yeah, yeah. And I think like we all kind of, any retail trader, I don't know if you guys invest in the stock market yourself on an app. Anyone's like, there's stocks that just fly and it's kind of obvious. Like I remember buying Nvidia or buying Tesla and you're like, some things are just obvious to younger people, but if you just don't do the research, you're not going to get those asymmetric gains. Yeah, but most people don't do the research. Yeah, most people don't. And I think... Most things I think are obvious are wrong.

42:35Most of the time when I invest, I lose money. That is fair. Do you have the inverse Kramer effect? No, no, no. But I think there are certain people who just have a knack for it. And I think we were talking earlier about how most people should just invest in index funds. I would say, I think that's true for the most part because a lot of people want to do it themselves, especially I think there's this advent of DIY but I think the goal is for autopilot for you to find someone who you have confidence in and can see the track record of success you put like 10 to 20 percent of your net worth not all of it but in about 10 to 20 percent in these high-risk high-reward strategies

43:07Sam Parr:you know what's fun wait so we're doing this Ray Dalio thing tomorrow we're interviewing him and he started as a newsletter it was like a$1 ,500 a month newsletter that's smart and then someone was like hey if you think you're the man then why don't you have your own fun and like you know and he's like maybe I will And now we have the biggest one. Now we have the biggest one. And so my question is like, why doesn't, I think, you know Motley Fool? So Motley Fool does nine figures a year in subscription revenue. So for you who don't know, Motley Fool, you give them$100 or some amount of money and they give you stock picks.

43:37Sam Parr:But they also have a fund where they invest in their own picks. And I think they have over a billion AUM. It's all public. You can like look it up. So will like every financial blogger who like is a stock picker, like be an autopilot person? Yeah, I think that's gonna happen. And we have... But then there's going to be way less of them because everyone's going to be able to see who's legit and who's not. See, exactly. And so we have a 6 ,000-person wait list to launch a portfolio on Autopi. So we do a lot of due diligence. We look at the track record of success. We'll analyze their actual portfolio.

44:07Because, for example, if you run a newsletter but your actual portfolio is bad, we don't really want you on the platform. Who's the most famous or successful person that launched their portfolio on here? Not like you're tracking the politicians. It's a guy named Peter Wolfe. And so I checked out his personal Robinhood account and I was like, this guy's up 200%.

44:24Sam Parr:How do you check someone's personal Robinhood? So I just buy, like I would go on a video call and I would look at it. But right now we have tech where he could actually connect his Robinhood account to our platform and we could analyze it automatically. And 200 %? Over three years. And I was like, all right, 200 % over three years. But that's a pretty small amount of time, right? Three years is like. Yeah, yeah. I mean, you're right. And it's like, what does it do in a downturn? But I liked the way he was thinking about what he does to hedge against risk. and I was like, you know what? Like launch on the platform.

44:51So you guys are kind of like, you're, you are like the editorial team. You're, you're the American idol. You're letting them sort of audition. You're picking, right? Yeah. So you're picking the pickers. Then they launch their portfolio. People then pay up front to do it or people just copy the trade and you get it. That person gets a commission. There's like a subscription fee very similar to Substack. How much? The pilot could, we call them pilots. They could set it. It ranges from a hundred bucks a year to 500 bucks a year. And so they do that how much are the top people making as... The top people are making around one to two million dollars per year on autopilot.

45:25Whoa. Which is insane. That's outside of their stock. That's just their autopilot revenue. That's just their autopilot. And so that's like, that means they have how many subscribers? Like 10 ,000 subscribers? It depends on how much they charge. But for example, Peter Wolf has around 220 million dollars following him on autopilot. Oh, so you see like how many dollars are backing you. Yeah. And so again, for example, this is the stat that we pull. Bill Ackman, who traditionally raised a lot of money really quickly when he graduated Harvard, it took him about five years to raise$60 million. This guy on autopilot within one year raised$220 million.

46:02So you're basically, it's kind of like Justin Bieber was YouTube native, right? He was a YouTuber first, then became Justin Bieber. And you're basically saying like, the next Bill Ackman, the next generation's Ray Dalio is going to come from a platform like ours or from you. Do I put my money into Peter's fund? Yeah, so what would happen is you connect your Robinhood account to whatever brokerage you have, and it automatically follows his fund. So when he makes a trade, we send a notification to your brokerage to automatically buy or sell that security. Copy trade. But it's not giving the money to the guy.

46:34Yeah, and that's actually... You keep the money in your Robinhood. Yeah, and that's how we are able to operate from a legal standpoint. Whenever you're giving custody of assets away to someone, the SEC gets really involved. Is that a brokerage? You have custody. That's when a lot of regulation popped up. How old's the business? Autopilot. We've been running Autopilot for three years, but the entire business structure is six years.

46:53Sam Parr:So Autopilot has existed in three awesome years. Yep. What's going to happen in six years when you have three shit years? If we have three shit years. Like stock market shit years. Yeah. That's what he's saying. I think what we see is the retail investor right now perseveres longer than they used to. Three years is a long time. I would say if it was like three years downturn like consistently. I feel like the whole world will, there'll be a lot of questions for the whole world. But that happens. It happens to like Robin Hood and these other guys, right? Like what do you mean? I think three years straight it hasn't really happened, but I think you'll see like one and a half years happen.

47:27So I think if there's... And Robin Hood almost died.

47:30Sam Parr:Yeah, Robin Hood. But they didn't because they had raised billions of dollars. Yeah, and they had an emergency funding round. Yeah, so like it was a near-death moment. When was that? During the GameStop? That was, yeah, during GameStop. They were about to go under and I think they had raised $40 billion like immediately. and, or not, sorry, $4 billion immediate. Because they needed liquidity? Yeah. There's something with like being a brokerage and like the DTCC, not too familiar with it, but they're like, you need to post up this money. We don't have it. Are people nervous to invest? Are venture guys that nervous to invest?

47:59I think what we've seen in venture is just the AI wave and it's just not, fintech was sexy in 2020, 2021. Right now with our metrics, I would think it would be very exciting for venture capitalists.

48:13Sam Parr:Like we have some friends in fintech, like a lot of fintech companies make like no revenue. Like, you know, you could be like, what's the thing called? Wealthfront. And you could have billions of dollars in AUM and like your fees are so tiny that, so you're making 30 actual million in revenue? I think, yeah. Or GMV, like, that you still have to pay to. So right now, because we've launched our own portfolios where we take 100 % of the revenue, like the Pelosi portfolio is ours. So we get 100 % of that revenue. Our GMV revenue is 30 million, but our Autopilot ARR is around 22 million. Okay. So you have more real revenue than like, remember Ankur was doing carry and like he had like a billion in AUM, but the revenue was like literally a million.

48:51I think, yeah, I know that to me always blows my mind. I think the thing that's interesting about us is when you look at other traditional asset managers, they just put your money in like ETFs and like mutual funds and there's no real alpha they're trying to get you. So they can't really charge that much money because you're like, why would I go to them? Why don't I just go to Wealthfront that charges like 0.1 %? And so with Autopilot, the reason you pay so much is because these people are, the hope is that they outperform the market. And so I think the average income that people pay on Autopilot is around 3 % to 4%.

49:21Does Nancy Pelosi hate you? Probably, I would say. Have you guys interacted? No, we've never. No cease and desist even from her? No, no. Wow, Nancy. Or props. Perfect. Or she's getting soft at her old age. I mean, the goal is when she retires, we try to have her actually join the fight. And have a commercial. That'd be incredible. We did sponsor the UFC and got a fake Nancy Pelosi. Did you see this? This is incredible. No, I haven't. And so the goal was, this was the UFC before the election, and Trump was supposed to sit row one at the UFC. And we were like, wouldn't it be funny if we sponsor the UFC and it shows invest like a politician right in front of Donald Trump, and then we have a fake Nancy Pelosi right by him.

50:04Like you bought a ticket? Oh, yeah. Or as part of the sponsorship. We had the ring sponsors. Invest like a politician. And then they hired a lookalike, Nancy Pelosi, and they had her walking in. They had like the kind of social content of her entering the arena. Did you have to actually buy that ticket? We had to buy that ticket. That ticket row one was$60 ,000. No way. How much did you spend on the whole marketing buy? About$450 ,000. Did it help? It didn't help directly. I think the brand affinity was there. Would I do it again? Probably not. It would have helped if Trump was actually showed up.

50:34that was a weekend when there was an assassination attempt. That makes sense. There was, and I was like, dang, he's not here, but I'm glad he's safe. But I think if he did show up, I think the media that would have been picked up, the earned media would have been insane. Hey, it was ballsy. And sometimes you got to do what you got to do. I think it was cool. We're still talking about it now, right? Exactly. There's earned attention that happens when you do unique, over-the-top things. So that's amazing. Yeah, we're trying to think of the next stunt, but we'll see. How many people worked there?

51:04Right now, 30. 35.

51:06Sam Parr:So you're doing 800 ,000 of revenue per It's about a million dollars per employee. Walk me through the like, what does this look like if this is actually big? Because some of the weird ideas this is a weird idea. And weird ideas have a lot of potential even though on the surface it takes a little time to like understand. I guess to me it was kind of like a common sense idea. Like I don't know, growing up I was like man why can't my Robinette account just like follow this other guy's Robinette account automatically like I don't want to just give my funds away to someone else. I want to be able to do stuff myself, but I also want to go on vacation without worrying about when to sell or when to buy.

51:40I think the solution to me was just the most obvious. But I think the ultimate goal of Autopilot is to become the world's largest asset manager. When you look at BlackRock, they actually do this for institution. BlackRock connects all these financial institutions. Companies will go on a tool called BlackRock Aladdin and buy different portfolios. So it already exists at the institution level. When you say buy different portfolios? BlackRock will create their own portfolios based on different risk. And so if you're Walmart and you're heavily invested in groceries for this quarter, you could actually hedge your bet on BlackRock Aladdin.

52:11If you're a Facebook employee, you could actually find a portfolio on Autopilot that hedges tech. And that tool that BlackRock created makes around$6 billion per year, and BlackRock's one of the largest asset managers. And so I think with Autopilot, one of our goals is to get that same tech and build it for retail investors. How are you going to hire those people? Well, he's saying people come to the platform. It's two-sided marketplace. And so then the pilots come and they're the ones with the ideas. You verify their employment where they've worked. But really the goal is where anyone could just publish those portfolios and get paid.

52:42And then us as a marketplace, we take a cut of that revenue. What would be the burning question? I have a bunch of large macro questions on AI, but I also have questions because you guys have been running companies for 10 plus years. One of the biggest things is hiring. How do you find people that are highly motivated? What questions do you ask? Because one thing that I've noticed is when you hire especially more senior level people, their ability to BS is greater than my ability to detect BS. And I think there are certain questions or certain things that you could look at that you guys probably have more experience that would actually really help Autopi get to the next step.

53:15Sam Parr:Well, for one, having like a personal audience is like definitely, that's probably one of the biggest perks is that you're able to like, if you cold email someone, they're like, oh, I've heard of you or I know of you at the very least. At best, you have a lot of people who apply. But whenever I would hire for people who roles that I didn't know what the hell I was doing, I definitely would have like an outsider hiring committee. So I would have outsiders interview people all the time. And that helped me a lot. Yeah, that was going to be one of them. I've covered probably three or four tips. They're not all related.

53:44The first is I find a lot of my hiring mistakes where I didn't actually even understand what I was hiring for. I wasn't clear enough. Sometimes that comes from, I do the work for a little bit and I'm like, oh, okay, what the person's going to need to do is XYZ. As you scale, that happens less, but still writing down, not like a generic, like I think a lot of people outsource the job spec to either ChatGPT, a recruiter. It's super generic. It's going to attract a generic candidate. And it's not actually clear. What are you trying to get somebody to come change in your company? What do they need to be world-class at?

54:13what sort of problem are they going to have to solve and be really, really clear. So that's the first thing. Second is kind of yours on outside help. So I have a buddy who he's better at hiring than I am. And so what I would do for any executive hire is I would call the favorite, be like, Hey, like once I've done the screening, will you talk to these, will you talk to my favorite kind of three or four candidates and give me your take? And it really wasn't about who he picked. It was me becoming a better hirer and interviewer by understanding the delta of like, I thought this person was great. He sniffed out their bullshit really quick.

54:46Why did he do that? And I'm watching the call and I'm realizing like, oh, he dug in in a different way, asked a different style of question, didn't accept their first answer at face value. I got to start doing that. And so I got better by doing that, not just because they helped me pick this person, but because I realized where I was weak in the interviewing process. I also think there's two really good pools to hire from. One is you want people who've either done it before or never done anything, but can do anything. So done it before is who solved this problem before? I always start there. Because if I can find somebody who's already done this before, that's going to help me a lot.

55:20And I mean specifically. So it's not just like, oh, he worked at a successful company, but they do enterprise sales and we don't even do enterprise sales, right? It's like, no, they solved, they did this exact thing before this.

55:31Sam Parr:We've talked about this a lot in the pod where it's like, it's so fun to hire young people. They don't have any experience. It's so fun, right? because that's what you were recently. But like nine out of 10 times, if you're just like, hey, you did that there, do that same thing here. Right. And that tends to just be way better. So we will map out which companies have solved this problem before. Who was the person that was there at the year when they had this problem where we are? Who was that person? And then were they the real shot caller on the team or were they just doing something, but there's somebody else who was amazing?

55:58I like go to that level of detail there. So that's one pool you got to get good at. And the other pool is like basically diamonds in the rough, like unproven talent that you can almost be a stock picker on and be like, okay, I think this person's like a 10Xer and I build the company with those two pools of people and you build systems so that you consistently are sourcing from both of those. Yeah. One thing most people, are you the CEO of the business? How much time per week do you spend recruiting right now? Right now, about 20%. That's pretty good. Most people, that means one full day a week, basically.

56:28Yeah. Most founders who have like hiring problems, if you ask them that question, they're like hours. I think it used to be that and now I'm like seeing how important it is. If you listen to like a lot of the most successful founders that were in a scaling phase, they spend like 30 plus percent of their time just on recruiting. Are you guys profitable? Yeah.

56:47Sam Parr:Okay. So you're at 20 million in revenue. Or 30 million. 30 million. 30 million in revenue. I guess cash flow positive, not like gap profitable, but. Sure. So your default alive. Yeah. What's the growth rate going to be this year over the next year? About 250%. I would think almost your entire job is collecting people. What sorts of people do you need to be hiring right now? A lot of software engineers, product people, growth people, marketing people, really anyone. People, people. Just people. I think the thing is, is just maintaining that high bar. And we've just hired a lot of people. And perhaps I'm actually very quick to get rid of people.

57:22If they come in and within two to three weeks, they haven't really done anything. I just immediately, I'm like, all right, you're getting out of here.

57:28Sam Parr:And that impacts culture, which is why you got to get the hiring right. It impacts culture, but I think everyone who's been here, anyone who we tell people, if you're here for longer than three months, you don't have to worry. So I think after the three-month mark, people are like, okay, I'm chilling. But before that, everyone's like freaked out. Are you going to only hire New York? Yeah. Can you afford it? Yeah. I think especially with AI, the salaries that we're paying people, we just offered a guy like a$350K salary. And I'm like, this is crazy because I've never made that much money. I still don't.

58:02But yeah, I think the goal is with AI, each person is much, much more effective. So a good person with AI could be 10, 20 times more effective than an average person with AI. That's crazy. My CTO used to say it too. He's like, you're one person? No, you're three people. He's just, you're three people. He used to say that all the time. And people like, it's funny. I might start saying that. It's real simple. It's just people just realizing what you mean. It's like, no, you need to be able to do the work with three people because you got to be smart about what you don't do. Don't do the bullshit.

58:30Automate stuff. you know figure out like a faster path you know that's your job is to be three people and what we used to do off sites we would say every day is two days like two days of stuff needs to happen every day and so I think when you do that you set up set a different bar for your team on how they operate

58:46Sam Parr:yeah dude thanks for doing this yeah this is awesome you're awesome we I messaged him roughly two hours ago and I was like where are you yeah I saw the post I'm like yo Sam I gotta get on my first this is a dream can you be here well you guys are one of the great like growth hack stories. Like there's, you know, what you guys did with the Pelosi tracker. You have another tracker. Do you have other trackers? Yeah, we like, you know, the Leopold tracker. Who's the best? Right now, Leopold. He's up. You know this guy? Is he like a 25-year-old? He was like a 22-year-old. How old is he? He worked for OpenAI.

59:17Now he's like 25. He left OpenAI and then started a fine. Isn't he up like $10 billion or something? Around$5 billion. So he's a billionaire now? I think so. And he raised outside capital? I think a lot of it It was friends and family. It was like Daniel Gross and Nat Friedman and like smart money was immediately behind him. How much did he raise? I think originally 500 million, not that much. And now he's at like upward of$5 billion. But what he did, which was super smart. He's 10X in two years. Yeah, he looked at what companies, what was the bottlenecks of OpenAI? And he was like, okay, well, SSDs, like a lot of people thinking GPUs.

59:52He was like SSDs, like Micron. And so he just started buying all of like the other bottlenecks that no one was focusing on. and now they're just like skyrocketing. And isn't like his, somebody is like the chief of staff at Anthropic. He's got some information flow as well. That's pretty good. Yeah. I mean, he's brilliant. Have you read his like situational awareness paper? No. Okay, so do this. I did this and it was very, very useful. Take the PDF for situational awareness. It was like on my list of like - What a situational awareness team. Hedge fund name. He published a white paper or blog post, like a PDF before he launched the hedge fund or right after.

1:00:28I think it was actually maybe before and this is how he attracted the money. He launched this thing which was basically he had a very strong point of view on like what the next 10 years of AI looks like. Very bold predictions it was like. And then huge tension between China and America and then because of that this. It was like super specific predictions of how the puck where the puck was going. So he published this thing and a lot of smart people were like yo this is like one of the smarter takes of what's going on. I think that attracted more capital more awareness.

1:00:55Sam Parr:And situational awareness was the name of his publication. And I think it's the name of his fund or whatever his company is. So take it, give it to Victor in your Slack. Yeah. I say, Victor, break this down into the 10 key ideas, like predictions and hypotheses that he has. Explain it and just explain it to me. Victor did a wonderful job. He just chewed up this PDF for me. It explained it step by step. And then I asked follow-up questions and it was just great. And I was like, so did that play out? Was he right about this? Did he trade on that? and it just answered every single question. It was so good.

1:01:28Is a guy like him... Victor, by the way, is like an AI thing that Sam put me onto that I am now hooked. I ended up investing in it. Yeah, thanks for telling me. Because after I told you about it, you should have told me that... Well, it was at an absurd valuation, but it's that good that I was like, yeah, for sure.

1:01:43Sam Parr:Well, I told you, I told him about this tool. He's like, I don't know. I don't trust these tools. These are stupid. And then two days later, he goes, these tools are awesome. Have you heard of this tool? I made him feel dumb. I was like, why do you just trust a random startup with all your stuff. And then I heard about it a little more and I was like, let's try it out. And I tried it in one of my slacks and I was like, this is amazing. Now it's in every business I have. Yeah, it's good. But the, I'm curious about the personal side on this. Is he like low key right now? Is he trying to hide out?

1:02:07Sam Parr:No, he posts on Twitter. Really? He's like very good friends with Dwarkesh. So he's done the Dwarkesh pod a couple of times. I mean, Is he cool? Yeah. Do you think like Peter Thiel's cool? Like, you know, do you think a lot of Asperger's genius is cool? Yeah. I like that energy. Yeah, he has that. He's great. I love it. I love it. You can follow him on autopilot. You think that's cool? I'm saying cool is not the word I would use. I love it, yes. I think he's awesome. And so you can replicate his? You can follow his top 15 picks on autopilot. And how do you know his picks? So he follows a 13F. And so it is...

1:02:41There's a little lag, yeah. There's about a 45-day lag. But even... We only track with the lag.

1:02:45Sam Parr:And a 13-day F, how big does your fund need to be? Oh,$100 million. Oh, okay. Damn. So he's the guy right now. He's the guy. He's the guy. Does he do podcasts? You actually get them on. There's a couple. We were trying. I think we were reaching out, yeah. And it's stuff like this that make me very adamant of people should always invest in index funds, but there should always be 10 % to 15 % of your net worth on high-risk, high-reward stocks or portfolios. And so this is where Autoply doesn't right now want to take 100 % of what you have. What percent? I would say 10 % to 15%. Your liquid net worth, where is it allocated?

1:03:18Who are you following? Right now, I follow basically like 20 different pilots on autopilot right now. So right now of your 100 % net worth. So of my 100 % net worth, it's like 90 % on autopilot. A lot of it is in autopilot equity. I want to know the truthiness. So you said you connect with their brokerage account. Yep. But like people have many different accounts. Yeah, so we could connect to all of them. You could. But you don't know if this is tracking all of them or just tracking something, right? Me as the user, I don't know if you have everything that this person has done, right? Yeah. Winners and losers.

1:03:47So what it is, is the people will go on our platform and create a model portfolio. And so you only see the history of the model portfolio from when the pilot joins to now. So it's not like actually following their brokerage account. Oh, okay. But what we do have is we have what's called skin in the game where the pilots will also put their money on autopilot following their own portfolio. And so you could be like, wow, Peter Wolf has$500 ,000 following his own trades verified by autopilot. Gotcha, gotcha, gotcha. Are you having fun? I would say right now I'm having fun. I would say the last three years have been, it's hard.

1:04:20I would say getting from zero to one million in revenue was the hardest thing I've ever had to do. Getting from one to 30 was actually a piece of cake. What do you think the next threshold will be? I think we're on track to hit a hundred million in revenue by March next year. I think it's going to be difficult. Run rate. Reoccurring revenue, not run rate. Right now we're at like a 70 million run rate. But we want to get like... I passed on investing in this like twice already. Yeah, why didn't you do it? It seemed like a really hard thing to get off the ground. It was very hard. How did you get rid of this?

1:04:55Well, I'm a degenerate, and they were listening to MFM, I think. So like, they knew that I'm a bit of a dude. You've talked to Chris a couple times. I talked to Chris. I really admired the marketing. So I think I just reached out giving respect. I was like, hey, I think it's brilliant what you guys are doing with the Plus Trekker on Twitter and the UFC. I just thought you guys were doing a really good job of that. I think without the marketing, we wouldn't be here just because of how hard this stuff is to do. What was the first round's valuation? the first round was 7 million right yeah but that was 2021 there's a lot of yeah man yeah well either way I'm a fan and I think what you guys are doing is great man I appreciate you coming on this is awesome alright we appreciate you

1:05:31Sam Parr:thank you guys we'll talk to you a little bit that was awesome good picks yeah that was fun I hope this is a Hampton plug by the way I definitely just went into the New York channel and I just said yeah who's interesting because I didn't want to tweet it out because I wasn't sure what we were going to get. Well, I'll do the plug for you. If you're an interesting business owner and you want to be in a community of other interesting business owners, join Hampton. And maybe you too can be on MFM someday too. I didn't realize how big Autopilot was. I thought... It's been scaling a lot. Like it wasn't that big like six months ago.

1:06:01Sam Parr:You know what I did? Well, I knew it was 30 million in revenue. I thought that meant like GMV. Because those businesses, not his business, but that category of business is usually pretty shitty. Right. Like numbers can be huge, but the actual business but not his that's insane yeah he's doing well that was cool right you know one of the things with probably the biggest thing for me since I started My First Million until today was I remember pre My First Million kind of like 10 years before that the full 10 years I felt like opportunity like success was this this needle you had to do these things in this haystack or it was this narrow thing this thing I had to search for in this room and it was so hard to find and I needed this brilliant idea and if I just is this the brilliant idea?

1:06:44Where is the brilliant idea that I need perfect execution? I remember opportunity just felt so scarce. And then one of the things of you move to San Francisco, you meet a bunch of people, we start doing this podcast. It's like, you just realize, oh dude, there's thousands of different, tens of thousands of different ways that I can win. Opportunity is everywhere. It's really about picking what's the right fit for me. It was a total like from lack to abundance mindset shift on success. Like where does success live? And like what I like about a thing like this that we did today is those are three ideas that didn't even exist in my cone of vision.

1:07:19You know, I couldn't even, I didn't even know that people do businesses like that.

1:07:22Sam Parr:And there's also parts of their business and their lifestyles and personality that I want to like, like I love and I want to steal. Right. But I don't admire the whole thing. Like for example, Alex, I'm like, oh man, he's so calm. Right. Like, oh, I need to learn from that. I don't necessarily want to trade what I have for what he has, but like I want to steal this from him. He wasn't in a rush. Yeah. For better and for worse, but mostly for better. And same with Brian, huge business taking off. I don't want to do all those stunts. I don't want to raise VC, but that's pretty awesome. But I admire the creativity.

1:07:49Sam Parr:Yeah, they're like Josh's outdoor business. I'm like, that's awesome. I don't want to raise money, but like it would be maybe fun to own one. Like, you know, like there's really small. But I should go camping. Yeah. No, but there's like small things where I like, you know, I think people sometimes in the comments tease us about like having, I hate when people say you have these guests that are out of touch. Whenever I hear that, I'm like, no, you're out of touch with his life. Yeah, that's about you. You're out of touch. What I mean is I'm like, I am equally impressed by a billion-dollar company versus a$5 million company.

1:08:23Sam Parr:They're both equally awesome. Somebody, Jesse Itzler said this at one of our events. It was like an intro. What should people know about you? He's like, hey, I'm Jesse Itzler, blah, blah, blah. I did this. And he goes, my thing is I root for everybody because when you root for everybody, you can never lose. And then he sat down and I was like, yo, I kind of like that fortune cookie shit he just did. Is Jesse, it's literally a cool black man. Yeah, yeah. No, he's the best. It's cool black guys like him. Yeah. It's like, whoa. That's like the next level. So, in the same way of like when you root for everybody you can never lose, there's something like if you think you can learn from everybody, you can never lose, right?

1:09:01So, it's like, great, tomorrow we're talking to Ray Dalio. There's going to be some awesome things to learn from him. Again, parts, not the whole. We're not trying to do what he's doing, but I'm still going to pull something away. I'm going to get a win and I'm going to have some fun in that hour. Just in the same way I got wins and learnings and fun in this hour.

1:09:17Sam Parr:I think the new slogan should be, we get high, high and low, low because I get equal joy. We'll pop into a bodega. I'll love that shit. And now we're going to go hang out with the 80th, the richest person in the world. I'm going to love that equally. All right. That's it. That's the pod. I feel like I can rule the world. I know I could be what I want to. I put my all in it like no days off On the road, let's travel, never looking back All right, let's take a quick break to talk about a podcast Because if you're listening to this, you like podcasts And what's better than one podcast? Another podcast And let me tell you, another podcast you should check out It's called Success Story If you like hearing about different success stories And hearing Q &A sessions with successful business leaders Or hearing keynote presentations Or just checking out conversations about sales And business and marketing tactics This is a great podcast for you So check it out wherever you get your podcasts