Business Tricks We've Learned From Gamblers, Pickup Artists, & Feynman

22:22I got to find my thing, my new thing. That's the thing I just love to do. And I'm doing it for the sake of doing it. What I realized is it's fundamentally different. It's not a thing. It's a approach and it's a filter. And so actually it's a question that I ask at the beginning of anything I'm going to do that day, which is, am I doing this for some deferred payoff, some deferred benefits? Or am I doing this because I actually enjoy doing this? And so it changed the way I did everything. So for example, with my workouts, there was a version of workouts that I did because whatever, just, just bite, bite the bullet, just do this.

22:55And you're going to, it'll pay off later when you get fit versus, well, why don't I just do workouts that the workout itself is so satisfying? Of course, if I do that, I'm going to do it more often. I'm going to do it with my full effort and I'm going to still get the reward in the end. So I started working with this like boxing coach or playing basketball, different things that I wasn't doing before because I was willing to settle for doing something that today kind of sucks. But in the future, maybe it's going to turn out great. And I realized I had lived basically like 35 years of my life with the, this kind of sucks now, but oh, it's all going to pay off in the end.

23:26I realized it's a false choice. You don't have to do that. You can just filter every activity on, is the act of doing this going to be worth it? Even if it's challenging, it doesn't mean everything is so happy. But is the act of doing this the reward or am I doing this only for some future payoff? So it became a filtering criteria, not a one thing. So for example, I told you, I was reading the book, The Game the other day. Why did I do that? I was reading a book in the middle of the day, especially an old book that I'd already read before that had no relevance to me because I'm not trying to be a pickup artist or hit on women anymore.

23:53That's not what I was doing. But it was the thing I was most interested in that moment. And so I did it because the act of doing it was the reward because I was most interested in it. And I've done that with other hobbies, like picked up playing the piano. And I started doing other things that are all falling into this bucket. And I've never been so – you can hear it in my voice. I've never been so switched on after making this sort of shift in the way I chose what to work on. And that's a very, I'm going to say the P word. That's a very privileged way to go about it, which is if you hit the lottery, like maybe we have, or I mean, we've worked hard, but we've got lucky as well, where that's a very privileged way to go about it.

24:27And so I do think you have to eat shit for a certain period of time and also get some luck. But yeah, I'm very drawn to this way of living. I'm not sure that that's true. It's 100 % true. The reason I say that is, first, whenever somebody calls me privileged, I'm like, that's a compliment. I think they mean it as an insult. People use it as an egg. Not you in this case, but I'm saying most people, if you call someone privileged, you're trying to tear them down. I want my life to be described as one of privilege. That's the point. You're giving me a compliment. That's like saying, wow, you're really good at this or this comes effortlessly to you or whatever.

24:59I want my life to be described that way. That is a goal of mine. And I just mean that because most people will treat that as a negative and then they try to make themselves smaller, right? It's a little bit of like the tall poppy syndrome where if you have the freedom to do something and you are not doing it because you're worried about how it looks or how it sounds or how others don't have that privilege, you're wasting your privilege. I think that's a bad thing. Let me answer the other part, which is I would say that the most successful project I've ever done, more than any of the companies I've ever built or any job I ever had, has been this podcast.

25:30This podcast from a usage, like people listen to this, they like it. So customers are happiest. Financially, it's a very lucrative product that affords a very good lifestyle, but also just my enjoyment of it. the act of doing it. I don't do this episode for some future payoff. I do this episode because it's going to be fun to do. I enjoy this conversation, this conversation enough. By the time we click stop, I've got my payoff. And when I started the podcast, I literally wrote down that I'm going to lose money doing this, that I expect that nobody will listen to this and I'm going to do it anyways, because it'll be so fun to record these episodes, talking to interesting people and learning that it'll make it worth it.

26:08And I wrote down, I have this Google Doc. I'll share it. It says, my forecast is I will lose$10 ,000 a year doing this. My forecast is that really nobody but my mom is going to listen to this thing. And it's still worth doing. What were the other predictions? So I got into this position because I made a choice like that four years ago. Right? Like that. And so I don't think. I also thought, well, you got to eat shit for a while before you get to go do the fun things. I don't believe that that's actually true. I know a lot of people. That's 100 % true. Think about it. Let's say you're a 40-year-old landscaper with three kids.

26:38It is one way to do things. I know a bunch of engineers who work on projects that they are personally interested in. They build personal projects and one goes kind of nowhere, two goes kind of nowhere, but it doesn't matter. They're building up their skills. They're having fun doing it. And sure enough, by the third, the fourth, the fifth, either they built up skills where they're a highly valuable person that gets brought into a project that's already working and they get paid handsomely for it, or one of their projects takes off. But the whole time they were just doing the thing that they really like to do.

27:04I think that there is one way to win, which is grind and eat shit and pay your dues, work up the ladder, pick whichever cliche you want. And that that is a way to win. I know several people that from the beginning, they were driven by working on the things that were interesting to them, like any type of guy. Right. And when they're working on things that are interesting, it led to good outcomes. Because when you work on things that are interesting, you work on it longer, harder than a person who's just doing it for a reward. You get better at it. And when you get really good at something, that's when the payoffs tend to come.

27:35Well, I believe that can be true. And also it can be true that it's more challenging logistically for certain people. For example, you're a blue collar laborer with three kids at 40 years old. You work from 6 a.m. to 7 p.m. And you're like, there's just no time. And I just got to pay the bills. I do think that it's just more challenging. For many of the people listening right now, I believe you are totally right, which is we probably have a lot of college-educated, particularly college-age kids who don't have too much responsibility, and they should lean into this thing. And I completely believe that to be true.

28:13And I believe it also to be true that as you grow, this type of mindset gets stamped out of you. The world wants you to be vanilla. Yeah, absolutely. Let me ask you a different question. Of the people we know that are successful, just give me a rough number, what percentage do you think got there through the grind do shit they didn't like that paid off in an unsexy way and then now they work on things that are more interesting pleasurable that they're driven by curiosity they're driven by fashion they're driven by whatever versus people that made it by following things they were curious about maybe it was a bit of a lonely road for a bit maybe other people maybe it wasn't a hot market but it became hot but they were there already right that happens a lot what percentage would you say in each i'm just curious roughly how you would think about it.

28:57Is it like only 5 % got successful through following their own interests fundamentally? Or do you think that it's 50-50 that got successful following their interests versus following what was more proven? If I had to guess, 60 to 70 % of the people who we know, who we would consider wealthy enough that money doesn't really matter, probably made money in a way that looking back, they were like, that was really hard and miserable and I don't think I can do that again. And then a large percentage of them now, I would say only 50 % of them then go and pursue something that truly interests them. And the other 50 % just do the playbook again and are miserable while earning a great living.

29:40Yeah, so roughly, let's say 20, 25%, you think maybe we're in the bucket that I'm talking about, which is they were just doing what's interesting to them. And that happened to become something that was very successful versus people who chose things that were not as interesting or not as fun for them, but they thought we're going to have a payoff and it did. And here's why. Y Combinator is like the stereotypical Silicon Valley story. You go to Y Combinator. How long is Y Combinator? Eight or 12 weeks? Three months, maybe? Three months, yeah. Okay, so you go with one idea and you only have 12 weeks to decide if this is going to work or not.

30:15And by week six, they say, dude, this sucks. You should pivot this amazing idea you had to do credit card processing or to do something else that people want to give you money for. And so they just go, fuck it, whatever. I got to go down that path. But that path that they're signing up for is a 10-year journey or more. And so there wasn't too much thought with it. And so they're just like, man, I just got to get a win however way I can. And I only have another six weeks until I've got to go do demo day. So I've got to just settle on something and move forward and do it. And I think that that mentality is often what a lot of internet-based businesses are built on.

30:53So I think that's a little unfair to YC because, for example, I think that does happen. But one of the things that happens in those pivots, because I've invested in a lot of YC companies that pivot. And also, if you read Paul Graham's essay, one of the things Paul Graham advises heavily against is what he calls playing startup. It's like playing house where you sort of just try to manufacture a startup idea that you think might work or think might be good. He's like, the best way to figure out a startup idea is to scratch your own itch and to look at your own life and figure out in what place am I already living in some future that other people aren't, but I could build a product that would help them get there.

31:26Or what's a pain point we've discovered along the way of doing this that we could solve? So yes, they pivot quickly and they pivot in the middle of YC. But usually the advice is that you should pivot to something like the itch that you want scratched, the problem that you are currently having, or the thing you uniquely understand because of the way you live your life versus what other people do. And the biggest successes out of YC have typically been that, right? I agree that that... The Airbnb guys renting out their own apartment to make hay, or Brian Armstrong doing Coinbase because he lived in Argentina and dealt with the currency issues and was interested in Bitcoin.

31:58These were not ideas that fundamentally sounded good. The biggest successes, I think, are done that way. Yeah. But not the average success. I think that's exactly right. I think the most successful people will work that way, but the average or the majority are not that way. And I think that's probably the true statement. I'd have to go look through why I come into companies, but there's not that many 23-year-olds that know anything about payroll processing software. But there's a lot of 25-year-olds or whatever who have created something really cool like that. Our friend Jack, why did he do Vungle?

32:29I think he was curious of solving problems, but he didn't have a problem. He wanted success more than he wanted. He was like, this just seems intriguing, I guess. Yeah, let's just spend some time. He's somebody who made a shift. I would also say there's a confounding factor, which is that for a lot of the people who are our friends, the thing that they were interested in is the game. So it's not the industry that was the passionate thing. The passionate thing was playing the game of business. Can I give you two related things that came up for me? I don't know if you remember this, but when the OpenAI drama was going on, when they fired Sam Altman, one of the things that came out was maybe they have AGI internally.

33:05And everyone's like, no, they probably don't have AGI internally, but maybe there was some breakthrough because he had gone at some conference and said, there are these moments with OpenAI where you're sitting in a room When you get to see a demo and your mind gets blown, you've seen the future. The world is not the same because of what you just saw. He goes, that just happened about three weeks ago. And people didn't know what it was, but he was kind of just like teasing a little bit. And just, he wasn't even trying to make a hype thing. He was just trying to say like what it's like to work there.

33:29He was trying to use it for some other reason, but people took that and they're like, man, they must have something. Sam Altman said that or an employee said that? Sam Altman had said that. And so people started speculating, what is it? And then these leaks happen. They start talking about this thing called Qstar. Do you remember this? Do you remember this QSTAR thing? Yeah, I don't know what it is, though. So QSTAR, I mean, I'm not an AI PhD researcher, so I don't know exactly. But the idea is like there are different algorithms or different methods you can use to do something. And QSTAR is a certain technique.

33:58And so people were like, oh, QSTAR, does that mean they're using the Q technique or the star technique or whatever? That's not what people are using today, but maybe there's something there. And so this thing leaks. It's not been confirmed yet whether that was or wasn't a thing. But what ended up happening was there was a whole bunch of smart people that suddenly started sniffing around that technique. And just recently, a bunch of research papers got published saying that they're seeing amazing performance using this technique. And so this guy came on and he talked about that this is actually a phenomenon that happens frequently.

34:30So I'll just tie this together. This guy, Robert Kwanzy, tweeted this. I don't know this guy, but he tweeted this little story that I liked. And he said, Claude Shannon once told me that as a kid, he remember being stuck on a jigsaw puzzle. And his brother was passing by and said, you know, I could tell you something that would help you with this puzzle, but now I'm not going to do it. That's all the brother said. But that was enough of a hint for Claude to solve the puzzle. The great thing about the hint is that you can always give this to yourself. So basically, there's this phenomenon that happens in human behavior, which is that if you knew that there might be a win, you don't even need to know what the thing is.

35:05that alone will increase your probability of success. You know, want to know what else Claude Shannon did? Do you remember how I told you Ed Thorpe went to the roulette table and it required two people to be in the crowd? He was his buddy. That was the other guy. So in fact, if you look it up, there's like, it's called, I think it's like the Thorpe Shannon principle. And it's like the theory of, so Claude Shannon, who this guy is referencing, he was the guy who was tapping his foot to tell Ed Thorpe, which is pretty funny. So the second story that's the same principle is about Kaggle. So Kaggle is this online competitive place for solving problems, riddles, puzzles, whatever it is.

35:41I don't know if it's all coding or if it's just math puzzles. So this guy replied in the thing, he goes, one of my favorite Kaggle facts is that anytime that the leaderboard gets stagnant for a while in any competition, if one team suddenly makes a jump, that will automatically cause multiple independent teams to quickly reproduce the same breakthrough with no knowledge of how the first team made the breakthrough. And isn't that kind of amazing how it's like it's the four minute mile right uh what's the guy's name who ran the roger band so when uh prior to roger banister running four minute miles people were only like three seconds like 403 404 which is quite a long distance away from four minutes but basically when roger banister did it roughly four other runners also broke four minute miles within like three months of roger banister doing it right so the same thing just happened to me in one of my businesses so in one of my businesses.

36:30There was a marketing tactic or channel that we had looked at. We'd even kind of dabbled with, but we didn't exactly know how to do it. It kind of seemed like a puzzle we didn't know how to solve. So we put it on a shelf for a while. And then I heard a whisper that somebody else was just crushing it using that channel. Now, I don't know what they're doing. I don't know the technique that they're doing. I don't know how much they're crushing it. I just heard enough to know that they are crushing it. And immediately, we mobilized. And that same channel that looked kind of like a dead thing before to us, we didn't really know how to make any progress.

37:05We still didn't have any technique. Nobody gave us a tool of how to make progress. Just the knowledge that somebody else was making progress in that same channel fired us up, got us going, and we immediately found a breakthrough. And over the weekend, we did like 30 grand in revenue on this one channel. and it reminded me of the same principle of just the knowledge that there is a solution actually increases your probability of getting to a solution just the knowledge that somebody else has found a solution without telling you how at all will increase your probability and i think that's one of the things about this podcast that should help people that's one of the ways to use this podcast is that you're not going to do exactly what any of the stories we tell in this podcast do But just hearing other people's success, just hearing other people ran a four-minute mile will make you run a four-minute mile.

37:50We've had this with our friends, too, people who are saying, I'm going to make X amount of money in Y months. We had a friend that was like, I'm going to try to make a million dollars in three months. And just hearing that question, I didn't have that question before. Just hearing that question got me to start thinking about ways you could do it. Then hearing that somebody did it immediately made me want to figure out how. And even though I was not going to do any of the things that they did, it allowed me to figure out a solution that would be able to do that. I think that's one of the most underrated learning techniques you can have or success techniques you could have.

38:21What's that called? The MFM paradox, that you can become more successful following somebody else, even though you don't know what they did. Just the fact that they did it. And this is way less cool than artificial intelligence. but similarly when Morning Brew and The Hustle were first getting going with the newsletter business, we had the exact same thing happen multiple times where eventually I became... One time Austin came over after we had both sold and I was like, Hey, you want to see something cool? And I go, pull up your computer. I'll pull up mine. I know you got a document that shows everything that you guys were doing per month.

38:55Let me show you mine and you show me yours. And it was the exact same thing, by the way. It was weird. We were seeing little inklings of what the other person was doing as it was happening. and we kind of replicated each other's success and it absolutely happened the same way. All right, let's take a quick break because I gotta tell you a story. Let me tell you about the first time I tried to run payroll for my team. I was using a traditional bank and you know the type. It's got a janky interface. It's built like a 2002 tax form and it was open only during business hours. And I hit send and it froze.

39:25They flagged the transaction. They locked my account. They put me on hold for 45 minutes and then they told me I got to visit my local branch. And that was the day I started looking for a new banking solution. After asking a few founders what they were using, I found out about Mercury. And so now my payroll is two clicks. I can wire money. I can pay invoices. I can reimburse the team all from one clean dashboard. That's why I use it for all of my companies. And so do 200 ,000 other startup founders. And so if you're looking to level up your banking, head to Mercury.com and apply in minutes. Mercury is a financial technology company, not a bank.

39:54Banking services are provided through Choice Financial Group, Column 8, and Evolve Bank & Trust members, FDIC. Before we started this podcast, you said, what topics do you have? I'm feeling a little uninspired. And I have to say, you win a blue ribbon today because you have completely put a beautiful bow tie on this thing that I brought you. You brought so many good, interesting tidbits to add to the story of Ed Thorpe. That was pretty good. Well, can I leave you with one framework and I have one story? So the framework is, you know, when Ed Thorpe was beating blackjack or beating roulette, What's the first step that he had to do before he beats the house?

40:32What is step, absolute step zero before he even figured out how to beat the house? I don't know, just how to do it at home. Believing that it could be done, right? Believing that it could be done. And this is cheesy, but it is very true. And by the way, things that are cheesy, but true are underrated because smart people write off cheesy things because they're cheesy because they've heard them before, but they haven't actually acted on it. So their underpriced assets are things that are cheesy and true because they're ignored by other smart, ambitious people. I remember when I went to this Tony Robbins event on the second day, there's another guy who who hosts it.

41:07So the other guy, he starts off with a game of Simon Says to kind of warm up the audience. And you just think there's a warm up because they want you to be engaged as an audience. They want you to be active, do something, interact a little crowd work to start. So he starts with Simon Says. We're going to play Simon Says. Now, this is a room of about 6000 people. So there's 6000 people are going to play Simon Says. and he's like, the winner gets to come on stage or like the, yeah, the winner gets to come on stage and you're going to get this thing. I forgot what it was. Some good prize. But again, there's 6 ,000 people.

41:33So, you know, whatever. Good luck. So, he starts and he says, Simon says, blah, blah, blah. And then like, he immediately gets like half the people in the first one. So, for example, he goes, all right, you guys ready to play? Stand up. And everybody stands up. He says, he didn't say Simon says, stand up. So, you only do the thing when he says Simon says, but if he just says an instruction and you do it without saying Simon says you're out this guy clearly read the book the game exactly so he's got us on the cat string theory we were just obeying his commands so the game starts half people get out on the first round it whittles it down within five minutes he's down to the winner winner gets up on stage blah blah blah and he had the final 10 people he said stay standing you don't get to come on stage just stay standing and um then he called on somebody he's like the guy who's standing you got to the final 10 the guy next to you when did you get out he's like I got out in like the second round he goes let me ask you something did you believe you were going to win and the guy was like no I mean so many people it's a silly game I don't know I didn't even think about it he goes that's interesting ask next person did you believe you were going to win no he goes so raise your hand if you when you started the game you believed that you could win only like 5 % of the audience raised their hand he goes so all of you thought you were competing with 6 ,000 people the only competition was amongst these 50 people who actually believed that there was a way to win.

42:52And he's like, I'm going to leave you with two ideas. Number one, if you're going to play the game, decide to win. That's so funny. He's like, you don't have to win every game. But if you decide to play, you should decide to win. And he goes, the second thing is that in life, you believe you're competing with a much bigger pool of people than you actually are. Because the majority of people aren't even playing the game. And of the people who are playing the game, most of them don't even believe that they can win. You're only competing with the people who actually believe that there is a way to win.

43:18And so similarly, with this guy cracking blackjack, cracking roulette, that's a game I thought was impossible to crack until I read the book. I think it's called Bringing Down the House or something like that. That's the other blackjack card counting book. And immediately, my mind shifted into, oh, blackjack is a beatable game. We can beat this game. And suddenly I started to learn things. Suddenly I started to understand how do you actually beat the game of blackjack? And it compelled me into action. All right, let's pause real quick. I got to do the thrill of the shill where I'm going to give you a thrill here.

43:43I'm going to teach you something that I think is a very important principle that any founder should know. And I'm going to tell you about a company that's doing it well. All right. So the thrill of the shill is, have you ever heard of the law of category? Are you familiar with this? I've not. I think it's from the book, the 22 immutable laws of marketing. And in that book, it's talking about marketing. How do you actually stand out? How do you do the hard thing in business, which is stand out, get your brand out there, get customers and get them coming to you versus you just chasing them down and hunting them one by one?

44:11How do you get market pull? And the law of category is a very simple principle, which is that you'd rather own a category than participate in one. If you can't be the first in a category, you'd rather create a new category altogether. And that is something that many people have done. So for example, I'll give you one in the podcasting space. We're a podcast and this podcast started off very undifferentiated. We started off just as interviews with successful people. Guess what? That's what every business podcast is, interviews with successful people. How did you do it? It's all past facing. How did you do it?

44:43We started to stand out when me and you got on here. We started going a little future facing, which is, hey, what trends, what opportunities do you see? What's going on right now in the market that you think somebody could be capitalizing on? So suddenly we were in a new category. So how many podcasts were there that were talking about stuff that, you know, opportunities and trends that you could be capitalizing on for the next 12 months versus what did you do 15 years ago, successful person? And even when we invited guests on, we said, you got to bring some ideas. What opportunities do you see today?

45:11Now we're not just going to ask about the thing you did in the past. even further than that is you ever seen hot ones that show where the guy interviews celebrities but instead of just interviewing them they're eating hot wings while they're doing it escalating in hotness it's the law of category that show became super popular gets millions of views on youtube and he gets the best guess because he's the only podcast that does that he's the only show doing that he created his own category and now if you came in and you try to do a show like that guess what they would say oh it's kind of like hot ones they own that category they own that niche.

45:43And so the law of category is a very small principle, which is that without taking more effort, if you simply just define a new category, you now have a reason to buy, an RTP, a reason for a customer to come use your product, come use your service. Well, the company that sponsored today's podcast, Wander, is a great example of exactly that. These guys basically said, well, you have luxury hotels. You got the Four Seasons. You got, what's that fancy one, Amman, that everybody's going to nowadays. You got the luxury fancy hotels. And then you have stay in a house like Airbnb, where you get to stay in a home, multiple rooms and a kitchen and all that, but it's not as luxury and turnkey and just a beautiful, everything's taking care of your experience.

46:24So they created a new category, which is hotelified homes. So luxury homes that are on par with the nicest luxury hotels, but it's a house instead of being in a building in a skyscraper. You get a backyard, a pool, a sauna, you get a kitchen, you get everything you want in a home, but you get the guarantee that it's going to be luxury, unlike an Airbnb. So I think that they've done a great job. That's why they've grown so fast. They did, I think, like 12 million in bookings in the last 12 months because they created their own category. There isn't anybody else who's really in that category where they actually manage the property and therefore can guarantee a certain quality of service.

47:01Great thrill. Pretty good shill. I love the shill. Improve my shill, please. No, I think your shill was great. So if you want to use them, wander.com slash MFM. What do they get? I think they get$300 off their first day. If you go to wander.com slash MFM, so that's our personal code. That's just for listeners of this pod. You download the app. If you do that, you get 300 bucks off a stay. So you get 300 bucks off and you're entered into a giveaway that's going to be, they're giving away a free wander stay. So if you're one of the people who are doing this and remember the principle that's in this podcast, if you enter, you got to believe that you can win.

47:34Go ahead and enter and you might win the free wander travel thing. So check it out. Wander.com slash MFM. I think you said last time I go, you know, I'm not sure how many people are going to do this. So if you're one of the people that actually does it, you've got a pretty good chance of actually winning. Exactly. So it's W A N D E R.com slash MFM. All right. Back to the episode. So I have a funny story. I'll tie it up with this, which is that people have heard of a vicious cycle. Oh, that's a vicious cycle. And they'll say it's, you know, poverty is a vicious cycle. You don't have money. So therefore, you can't buy the best food or education.

48:10And therefore, you end up staying. You don't get the best opportunities. And therefore, you stay poor. Vicious cycle, right? We've all heard of vicious cycle. Well, a good thought experiment is what is the opposite of a vicious cycle? A virtuous cycle. What's a virtuous cycle? And a virtuous cycle, as again, a Tony Robinson, is basically if you believe. So if you have high conviction that something can happen. We've all had moments in our life where we are like, I'm convinced that I can do this or that it can happen. Then you'll take a different level of action. So belief drives action. The amount of belief drives the amount of action.

48:41So little belief will drive little action, which drives a little result. A lot of belief takes you to take a lot of action, which drives a bigger result. And guess what? Once you see that result, it reinforces the belief. So if you start with a little belief, you take a little action, get a little result. You'll be like, I knew it. I knew this shit wasn't going to work. it lowers your belief even more, takes even lower action, lower result. And the opposite happens where if you're a heavy believer, you take a shit ton of action, shit ton of action will start to yield a result and your belief will say, I knew it.

49:09I knew we could do this. I knew we'd get progress. You take even more action and it just becomes a virtual cycle. And so that is one of the things that I think is most important. If you are stuck or if you're at a plateau or you're not exactly where you want to be, step zero is you have to somehow trick yourself into raising your level of belief that it is possible. One way is to read books about other people who have already done it or talk to other people who have done it. Imagine yourself doing it. Whatever. Ask yourself questions until you are worked up into a fever that this is going to work.

49:39Because that's the only chance you have of taking enough action to actually get a result. I want to hear from the listener, the people who have made it this far. If they feel like I feel right now, which is like I want to run through a fucking wall. You're like a guy. You're like a pastor right now. You know, you're like one of these like black churches where you're like dancing and screaming and shit. And I'm just like in the crowd, like dancing as well. I feel good. Yeah. So now let me tell you a quick blackjack story of this. So I read this book and I become convinced that we can do this. I tell my buddy Trevor, I said, Trevor, we could do this.

50:15We can bring down the house. We can count cards. We can get rich off blackjack. He says, say no more. Trevor's a believer. He's down. What age are you? Perfect trait of partner being down. I don't know, 21 years old and we're a senior in college. Did you read the whole book? Read the whole book. All right. But again, because we have a ton of belief, we find a way to take action. I'm living in North Carolina. There's no casino in North Carolina. What am I going to do? Fly to Vegas? No, no, no. The belief drives action. The belief causes me to find a way. I realize, hey, in South Carolina, there's a riverboat.

50:45And that boat will boat out into international waters. And then you can gamble because it's international waters. That's the beauty of the world. It's got international waters. Anything goes. So we drive down to South Carolina. We get on this riverboat. and we drive out. But before we do that, we spend three weeks practicing. And it's the same system. You have a counter who's going to be keeping count. You have the signaller who's going to signal in the whale. So Trevor's the counter. Trevor's got the focus. I'm the communicator. I'm the signal guy. And our buddy Dan is going to be the whale. What was your signal?

51:18The whale's job is to come over. He's a gregarious character because the trick when you count cards is you need to wait until the deck is stacked Act in your favor where there's more, let's say, aces and the low cards are out. So the count is high. And then you need to vary your bet size. So that's actually how you win is you bet more when the deck is hot. You bet less when it's not. But if the casino sees you varying your bet like that, they kick you out. So that's why you need two players. You need one guy who's counting and the guy who comes in to make the bet. He needs to start with a big bet.

51:45So he only comes in when the deck is hot. And so he comes in and we're like, Dan, you've got to act like a drunken idiot. And you're just plopping down your whole stack on this one hand. and then you're going to double oh screw it we went play it again as long as the deck is hot and when the deck is not hot we're going to signal you to leave what's your signals to them so we have two signals you have the signal where you're supposed to come over which is basically it was me with my arm like you know kind of like like this is where I'm holding my arm like this but I'm behind it's like standing behind me it's hard to do I'm sitting down but just a standing posture so I'm standing behind Trevor Trevor's counting Trevor has a verbal signal to me so you create a word for every number so let's say you know the deck is if the count is one which is a very bad count he would just say oh he's just like all right all right uno mas uno mas like one more hand but that just signals to me the count is one one if there was two he'd be like he'd be like ah shit balls balls we got two balls that's why there's two and then he'd be like three and he'd be like you know he'd have things from three and we use like basketball player names or whatever and like we had and you want to get the guy in on the counts like 10 11 12 something like that and he'd be like dude I've had a dozen chances now.

52:53And so we practice for weeks on this. And we're in our dorm room. We're skipping class. And we're just practicing, practicing, practicing signals. Boom, boom, boom. Bets. And we're running simulations. So we have our friend, this girl who was our friend. She was the dealer. And she would deal it out. We were like, every time we're cleaning up, this shit works. And so we drive down to South Carolina. We get on the riverboat. We go. Dan's got his drunken tourist costume on. Trevor's the guy who's just bored. He's just sitting there. He's betting the minimum, but he's counting. and I'm the signaler.

53:22I'm Trevor's buddy. And so what ends up happening is count gets hot. We get to 10. And I signal. But in the real world, conditions are a little different. Dan's not as quick. They're a lot different. Because he's so busy being in his drunken character that he's actually acting like an idiot. He's not paying attention to anything that we're doing. So he's actually getting a drink. So he misses 10. Count starts to drop. But it's at 8. And I'm like, okay, whatever. 8's still good enough. Let's signal him. It might go back to 10. so I signal him Dan sees the signal he starts coming over now our dorm room was kind of small he's at the he's farther away so it takes him a little bit of time by the time Dan gets a table and he tries to cash in he tries to put down the bet when the count's like you know six or something like that and he puts his money down they're like well we have to color it up first we have to exchange your cash for chips no bet on this one so the hand gets dealt out it nukes the count back down to two Dan's hand is visibly shaking I'm like oh god this is not good he cashes in like$1 ,000 worth of chips.

54:22This is like big money for us. He takes$1 ,000 worth of chips. He's ready to bet big, but the count is now two and Trevor's like, balls, man. Ah, balls, dude. And Dan, he's supposed to take balls and he's supposed to leave. Dan is in, he's blacked out at this point. He's not drunk and blacked out, but he's just got tunnel vision. Like he's so locked into his character and these stupid things that he's saying to the dealer. He's completely ignoring the signal. And so he just puts the$1 ,000 on and we're both like, balls balls balls balls what's happening why are you betting this is the worst time to bet and we just get wiped out in two hands and you lost all your money lost all of our money and we were like the book made it seem a lot easier than this because in the book it immediately works and it starts a series of events that just escalates into them being ballers and yeah it's sort of like the game it's kind of the same thing with the game okay so we go back home we're licking our wounds were like, damn, what the hell, man?

55:20And he's like, I'm sorry, it was harder in real life. We're like, all right, whatever. It's all good, man. The belief was still high that, hey, there's a way to use blackjack to make a lot of money. So we said, you know what? Screw it. What if we're the house? And so we decided to create an underground blackjack club at school where we'll just be the house. These movies go one or two ways. Now you're on option B for a great movie. Exactly. So we tried to become the house. Now we're playing Molly's game, basically. So we, again, start running these simulations. were like, this is great. The house has an edge.

55:48We're winning. It's a no-brainer. So we and our friend the whole time was just like, you guys are idiots. You've already wasted one month of time on the stupid plan number one. Now you're on stupid plan number two. He's like, this is an even dumber plan. We're like, dude, what are you talking about? We're the house. You ever heard about the house's edge? We can't lose. We're the house. And he's like, okay. So we're like, again, two weeks into our every night, we're simulating this. We're trying to run we're like typing in Excel how much money you're winning you're not going to cheat you're just going to open up a casino that's it so he's like okay watch this so our friend comes in and just like owns us he walks in and he's like alright I want to bet he bets he loses alright bet more loses and we're like see told you told you this can work he's like cool and he's like hey give me all my fucking money back and we're like no dude.

56:44He's just like, you're going to give me all my money back right now? And we're like, what are you going to do, beat us up? He's like, no, I'm just going to call the cops. Tell me you're running a blackjack ring in your room right now. That's actually a serious crime. And you're going to get kicked out of school or you're going to give me my$800 back. And we were like, oh. You win. Yeah, we got him the$800 back and we're like, damn it. Yeah, you didn't see the part of the scene in Molly's game where she gets beat up for doing this. And this guy just instantly pointed out the fatal flaw, which is basically, you know, this is a crime.

57:17They could at any time just bust us. We would have to move the game every week and like somehow know that this guy's not going to screw us over. But any player who loses money would always have the ultimate leverage. So that's what I learned about leverage. And I learned that leverage is more important than an edge. You should have went back to the casino. It sounded like this stupid idea actually could have maybe worked if your buddy Dan got us shit together. The reality is that casinos, I don't know why people don't i mean i guess people do talk about this but casinos use six decks and they use auto shufflers now and so the ability for the deck to get really hot has been cut down dramatically and so you know they basically use six decks which will smoothen out the variants and then they auto shuffle and they shuffle before you get through the whole shoe so the whole point was like you need to get where a lot of the cards have been used there's only a small number of cards left and that that small number of cards is going to have a higher proportion of face cards for you.

58:09But that just doesn't really happen anymore. So I don't really know where the edge is. I don't think there's an edge. This has been a roller coaster. I feel like I've got my money's worth after listening to this episode. And I should have just been learning how to code the whole time in college. I should have just been learning how to code and I would have made a lot more money than all of my harebrained schemes to make money. Or playing League of Legends. One of the two. This was very good. This was a good episode. One episode. Is that the pod? That's it. That's the pod. All right. That's the pod.

58:39I feel like I can rule the world. I know I could be what I want to. I put my all in it like my days off on the road. Let's travel. Never looking back.

58:52Hey, let'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.

59:22If 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, Column A, and Evolve Bank & Trust members FDIC.