My First Million Live Event With Andrew Wilkinson (Austin, Texas) (Part 1)

0:00And I got so excited about it at one point that I was up at like 11 o 'clock at night. I was feeling all manic. I probably had a couple beers. and I sent this email to the entire staff and I said, guys, we're shutting Metalab down. We're going all in on flow. And Chris, my business partner who's here somewhere, where's Chris? Chris's over there. Chris was the CFO at the time and he looked at the numbers and he was like, we will be out of business in three months. Yeah. 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 day's on. Put your hands together for Webby award-winning Sean Puri, Sam Parr, and special guest Andrew Wilkinson.

0:41Come on out, you guys.

0:48Extra mics.

0:56All right. So we are backstage, and we saw all the bands that have played here. It's like Franz Ferdinand and like the killers and all these cool things. And I heard the sound guys. First of all, sound guys, I want to apologize. I heard them talking before this and they're like, what the fuck is this?

1:18There's like, is this like a rich guy's birthday party? What is this? I think they thought it was a graduation happening. So sound guys, sorry, but it is what it is. You always wanted to be a star. You wanted to walk out to a sold out venue. and I guess this was one way to do it. Yeah, it's one way to do it. So, Sound Guy, it's going to be the lamest thing you're going to see this week, but maybe you'll learn something. I don't know. But this is awesome. What do you think? Working? Fuck you, Sound Guy. Is this working? Come on, guys. You can tell who the real podcasters are up here. So we did this huge event in Vancouver.

1:54We had like 1 ,200 people in this massive theater and Sam sneaks out on the stage and I'm like, what are you doing? and he's peering around the corner taking photos and he goes, I'm posting this on Facebook. And I was like, who the fuck uses Facebook? That's so weird. And he goes, all the people I went to high school with.

2:14And so we wanted to start off by saying we were laughing backstage and we were like, right before we came on, we're like, we gotta talk about Nick Gray. Does anyone here, has anyone here met Nick Gray? That was the guy that was just talking. I just met him for the first time last night He is, I don't know if he's the most interesting man in the world But he's like the most interesting man in Texas, for sure I'll give him that I feel like on this show, we always talk about billionaires And there's a lot of money billionaires But Nick is a friend billionaire Yeah, last night, so we hosted a dinner last night With like, I don't know, 15 people And Sam had set it all up, it was going to be perfect He had this like high-end restaurant Table for 14 The time was locked in.

2:58We got reminders. We show up. It's supposed to be beautiful. You know, just a first class dinner. Everything was taken care of. And we get there. And immediately the plan was blown up. It was raining outside. It starts raining like crazy. And our seat was like half outside. Yeah. So we weren't going to be able to do it. Immediately, Nick Gray improvises. He's like, hold on. You six to the bar. And then he sprinted. Because I pulled up. I saw him running and I was like, Nick Gray, where are you going? And he was like, I'm scoping out a venue. And he, I don't know where he went. He runs into this place and he's like, hey, is this a event space?

3:38It's soaking wet. Yeah, and the women look at each other and they're like, what? And he goes, what's the name of this place? And they go, it's called Miss Kitty's. And he's like, are you guys in event space? What do you do? He goes, we wax women. And he goes, oh. I got 15 dudes outside. Do you have an event space or not? but he did. He found us this like, like abandoned shack, almost this amazing place. And he, he got us. It was really like a shed. It was an abandoned shed, but it was like, I don't know. It was perfect. It was exactly what we did. It was outside the rain. We were all in there.

4:11It was quiet. We could talk. And, and he hosts this thing. Cause what Nick does is he has this book called, I think the two hour cocktail party. And he's basically perfected the art of a two hour party. And I got to see it firsthand. He takes out his harmonica to get everyone's attention. And then he has this way of getting everybody to open up, to talk, to sit in the right places, do the right things. And it was incredible. The best part, though, was he saved you. So Nick is looking around, and he walks up to me. He goes, hey, are you all good? Everything good? And I say, okay, I want to go to the shed.

4:47I'm excited. I'm a little bit cold, though. Is it going to be heated? And he goes, hold on. I'll be right back. and he runs outside and like Sam said, it's like pouring rain. I don't know if you guys witnessed this yesterday, but it was insane. He comes back. He's soaking wet. He looks like that scene in Glen, Gary, Glen Ross when the guy's like at the doorstep and he brings me this sweatshirt, which he had paid like$70 for. That's who Nick Gray is. And the reason we're bringing this up is not because we like him. To be clear, we like him. To be clear, we like him, but that's not why we're bringing this up.

5:19But on our pod, My First Million, And by the way, is everyone here? Is anyone who doesn't listen to MFM here? Who's here for the graduation? Yeah, okay. And who here actually listens to us regularly? All right, that's good enough. And so we bring up all these weird businesses that a lot of people haven't heard about. And this one is probably the weirdest one. He told me he was going to write this book about a cocktail party. I thought it was a horrible idea. And so far, he's sold 11 ,000 copies of this book, which is insane. And so we have this dinner, and we meet all these interesting people at this 14-person dinner.

5:57I think we had a guy there who sold a company that sold dog supplements, which is the greatest business ever because who knows if it works, right? You have no idea. He sold his company for$650 million. It was insane. He was telling us a story about this. We had another guy who sells, also dog-related, dog ramps. So like, so your older small dog can like go up on the couch and he does 18 million a year in sales. There was another guy there that has a website that is like a marketplace. So you can rent a tractor and it's killing it. We had a person who has a car, a bunch of owns a bunch of car washes that does tens of millions in profit.

6:35What else we have? Anything else that was weird? It was crazy. It was different than San Francisco. If you go to San Francisco or New York, you get one type of entrepreneur. You get the AI, crypto, you get that in SF. in New York, you get something else. And in Austin, you get mustache, hat, tilt, and like, I sell tractors online or I'll sell your dog some vitamins. You know, you get a different type of entrepreneur. I bet in the, I bet in the crowd right now, we got to have some interesting businesses. Who, who here has a business? Let's get it, get a sense of, get a hand up. So keep your hand up if you own a business.

7:10And if you do over a hundred, raise them high, raise them up. If you do over$100 ,000, keep it up. If you do$500 ,000, keep it up. $1 million. $5 million. Okay, we got a few. Hold on. $20 million, anybody? No? Okay, back to five. No, no, no. We got them over here. We got a couple? Okay,$20 million. $20 million and up. We got one over here. Two here. One in the back. Any of them profitable? Okay, all right. Okay, Nick, we want to talk to these guys. I want to know what their businesses are. Put your hands up. Hand is up. I'm coming over here. All right. Stand up, please. Let's hear from you. What's your name and what's your business?

7:50Kelsey Larrick, 365 Holdings. We're an e-commerce roll-up. Sorry, can you say that one more time? In slow motion, please. 365 Holdings, we roll-up e-commerce businesses. I want to be Andrew Wilkinson when I grow up. You don't. Trust me. He's blushing up here. It's very sad. It sounds like a good kid. Who's the guy next to you? uh justin turner traction capital our we have a business that sells equipment to fire departments what do you mean i love the way you said all that but i'm gonna can i just try being you for a second sean puri puri dad of dad of the house changed diapers like you just said an awesome thing but with such like yeah you probably read about me that's the vibe i got we uh we sell like $37 million worth of equipment that fire departments use and firemen use every day.

8:44Like a hose? Yeah, hoses, nozzles. Uniforms? Uniforms. And why is, okay, so what about competition? Is it just like you're the only one in town, there's only one place to buy them? Or do you have a moat of some kind? We have exclusive distribution relationships in nine of the western states in the U.S. How much profit on$37 million in revenue? It's about 10 % margin. Does it feel uncomfortable when I ask you these questions? Should I ask, like, what do you look like naked? What was it like when you lost your virginity? There's only one way to find out. All right, what else? Who's got a weirder story than that?

9:21Anybody got a weirder story than that? Yeah, put your hand up if you've got a really weird business. She immediately was like, weird? Yes. Yeah. Hold on one sec, please. Hold on. Okay, so this is a paper koozie, but I own a 40 ,000 square foot print warehouse, and we print real koozies. so like it's really niche and it's really random not these small boy koozies that we handed out how long you've been running your business for um i've been in business for eight years but we do a lot of different types of printing um did you become a millionaire selling beer koozies that was my first largest e-com store that i created yeah selling koozies because i'm from the midwest and we drink a lot of beer and that's you look like you're from the midwest yeah i just You and I like...

10:04I'm close to St. Louis, actually. Is that your sister? What's going on here? We can be cousins. Anyone else have a really, really weird business? Like dog ramp level weird business? Tell them to let the freak flag fly. Oh, here we go. Guy with the Austin stash. There it is. The capital V-neck shirt. You just grow those when you fly in. As soon as you cross the border, the mustache just pops up. We make custom dog treats for hospitality businesses. So like when the Ritz Carlton has guests come with dogs, we provide the dog treats that they give to their guests. And why wouldn't they just use normal dog treats?

10:40Because they just have their branding on them. Oh, very smart. How big is that? We started 10 months ago, and we've grown it to half a million in 10 months at FrontRite. Wow. That's cool. This is cool. We're going to hear more businesses because a little bit later we're going to do like a shark tanky type of thing with a bunch of pitches. Yeah. We can put the lights down. Two times. Okay, there we go. So the cool part about doing this stuff is we get to meet all these interesting people who are succeeding and some are failing, which is actually just or more interesting. But speaking of a big success, Andrew over here took his company public.

11:15I thought you were pointing at me. Andrew over here just took his company public. It's called Tiny. It's not that tiny. That should be the tagline. It's not that tiny. And you were telling, he was telling us a story that we had not heard about almost selling the company like six years. This was a backstage story. Can we tell it? I think we can. Yeah, we can. We can tell it. So there's really two stories. So one. By the way, if you don't know, I got to do the intro. Andrew started this thing called Metalab. It was an agency that made a bunch of tech stuff for big companies using the profits from that company.

11:53He then started buying and investing in other companies, which that hold company or hold co was called Tiny. He recently took it public last week. It's now trading at 850 million Canadian dollars, which is only like 600 million bucks in real money. No, but it's a huge success. But it all started because he had this agency called Metalab where he was, like I said, doing stuff for tech people. but you were saying earlier that how that was like the foundation for the success of everything else. But you almost did something crazy early on. Yeah. So I almost wouldn't be sitting here. So we were sitting at dinner the other night and talking about this.

12:36And there's two stories. So one, I got very excited. When you have a business, you always know how much it sucks, how hard it is to run. And you always admire other people's businesses. And so I always wanted like a SaaS business, a sexy business. And so I started one. I started this productivity business called Flow. It was like Asana, except we didn't raise any money. And we had a great product, but it just didn't go anywhere. Like task management software. Task management, which is one of the hardest things to do. One of the hardest businesses in the world. And I got so excited about it at one point that I was up at like 11 o 'clock at night.

13:12I was feeling all manic. I'd probably had a couple beers. And I sent this email to the entire staff. And I said, guys, we're shutting Metalab down. were going all in on Flow. And Chris, my business partner, who's here somewhere, where's Chris? Chris's over there. Chris was the CFO at the time, and he looked at the numbers, and he was like, we will be out of business in three months. How big was Flow? Flow was doing like 300K of revenue, and MetaLab was like 2 million or something like that. And so Chris - How big was MetaLab when you were - 2 million maybe at that point? So 2 million in revenue versus 300 ,000?

13:44300K or something. I was just like, moment of insanity. And Chris went around to all the employees quietly and was like, please don't leave. Please don't leave. We'll be bankrupt in like a week and save the day. And then the second story was Chris and I, running an agency is really stressful and we got this offer for the business to sell it for 15 million. This is about eight or nine years ago, almost 10 years ago. 15, one, five? 15, one, five. And we actually went through the whole process, spent four months going back and forth with this private equity firm. We sign the documents. My lawyer calls me in, quivering hand.

14:23I sign the documents, and the wire's supposed to come in the next day. And so I wake up. I go to my local bank branch. I go to the ATM, and I look at the balance. My balance is the same. And I think, okay, it's probably going to come in later, so I check later. Nothing. Next day, nothing. Next day, nothing. I call the guy at the private equity firm, and he goes, hey, man, I'm really sorry, but we weren't able to finish closing our fund. so the deal is not done. So I legally sold the business and if the wire had come in, my business would be worth maybe nothing at this point because this was the entire foundation of the business and we would be tiny.

15:00So we almost lost it all. What do you think it's worth now, Metalab? I don't know. Hundreds of millions for sure. But I don't know. It all could have just one decision. Actually, you made the decision. And it was all driven by anxiety, right? It's panic. I'm sure every one of you that runs a business, everyone knows how miserable it is inside. Right. You talk to people, you look at them on the outside, you go, they're an amazing operator. They have a great business. But on the inside, there's a great quote by Brent B. Sure. He goes, every business is a slow motion knife fight. Right. Like you just wake up in the morning, you're sweating and you're fighting, trying to survive.

15:34Right. And we felt that way and we pushed through and it was OK. But we almost gave in. Did you before you sold the hustle to HubSpot, did you ever almost did you come close to selling before that? So when I was running the company, I was miserable most every time. So if you go on Facebook or Instagram, look at my pictures from 2017 and 2018. I was lumpy. I was pretty fat because I was eating all the time to make myself feel better. So I was miserable most of the time. And then this one company emailed me. They showed interest in buying. And so I fly all the way out to New York. And I start talking to them.

16:15and I get in their office and it's empty. And I'm like, where is everyone? And they're like, oh, they're doing stuff. And they take me to an office to have the meeting. And I look in the windows of each office and every employee is in a sexual harassment seminar because the CMO had just gone off the rails and did a bunch of bad shit. And so they get me in a room, they send me a term sheet and they're like, well, buy your company for$10 million, but it's gonna be all in stock. And I was like, well, show me the financials and let me see what's going on with your business. And I got a peek in it.

16:49And the company was Vice, Vice Media, which means that deal, I was so close to taking it, it would be worth zero. I'd probably be in debt because the valuation has just plummeted. And so I almost took that because I was so desperate to get out. The sexual harassment seminar almost saved you. It did. Yeah. You're a survivor.

17:16I 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.

17:36All right. This episode is brought to you by Mercury. They are the finance platform of choice for over 200 ,000 companies. shouldn't be surprised because I use it myself for not one, not two, but I have eight different Mercury accounts. I have seven for different companies that I'm a part of. And then I have my own personal account because now they have personal banking, which is a really cool feature. I highly, highly recommend it. Like I said, I use it myself. And the reason why is because the way that Mercury works is beautiful. It's very intuitive. And you could tell that it's actually made by a startup founder.

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18:29For more information, check out mercury.com. Mercury is a financial technology company, not a bank. Check show notes for details.